As the article eludes to, many buyers are finding their dream homes. It just so happens those dream homes happen to be short sales. So, they go through the arduous task of preparing an offer, submitting it to the bank, and waiting. And waiting. And waiting. And, well you get the picture. As you might expect, these buyers get upset at how long it takes the bank. The contact their agent and demand answers not knowing the agent has been demanding information behind the scene from the sellers agent.

Who is to blame? Nobody will provide an updates. Nobody will provide the buyers or their agent with any information. Frustration sets in as many buyers decide perhaps its time to withdraw their offer and move onto another property. Only this time, this property isn’t their dream home. They are settling for a home that is not exactly what they want because somebody won’t provide them any information. Again I ask you. Who is to blame?

The answer is probably the system. As a sellers agent that represents many short sales, I feel the same frustration. I have the same goals as the buyers and the buyers agent. My goal is to get the home sold. If I don’t get the home sold then I have let both my clients and myself down. My goal is to help my client avoid a foreclosure on their record. My goal is to help negotiate a sale with the bank that achieves this end result. My goal is to get the buyers that are patient and want this home into the home. And of course, my goal is to get compensated for all of the hard work I have done. When the stress of a short sale sets in, and buyers withdraw it can be emotionally draining.

The system is tradition. Banks are funneling through millions of files at once. Let me say that one more time. Any given bank doesn’t have a “handful” of short sales. They don’t have hundreds of short sales. The smallest banks and credit unions might have thousands. The medium sized banks might have tens of thousands or even hundreds of thousands. The larger banks have millions and millions. Fannie Mae and Freddie Mac own nearly half of all mortgages in this country. So when Wells Fargo, Chase, Bank of America, National City, and any other large lender has a short sale, they only take care of their files. But nearly all of their files are owned by the aforementioned entities.

I have had weeks on end where I try to get some sort of update from the bank. Some news I can pass along. I am not even necessarily looking for good news, just some news. In a current transaction for example, the bank sent over a letter outlining the terms they would accept based on the current offer. The buyers agent worked with the buyers and they decided the banks terms were acceptable, so they adjusted their offer to be exactly what the bank wanted. At the time of writing this article the bank has had the updated offer for over 2 weeks and has yet to provide me a single update.

The buyers are getting very frustrated and the pattern sets in. Who can blame them? I understand exactly what they are feeling. Every buyer thinks if they can talk with the bank, they can get an answer faster. The problem is, that’s not the case. You can’t bully banks. The federal government recently tried that and it back fired. The banks keep this country afloat whether we like it or not. I know without the consumers they would be nothing. But they have built a society where paying cash is frowned upon. Nearly every person in this country manages their money through a financial institution. The only way to solve it is to live conservatively and pay cash for all of your purchases. Without financing, lenders would lose a small portion of the control they have over us.

Short sales are a great deal. The ones I work with in Utah are excellent values. Banks know what values are and are willing to provide excellent purchases to buyers. But, you must be patient. If you find that perfect home, and if you can get your offer into the bank, you have a very good chance of getting your offer closed. But patience will be required.

The article I mentioned at the beginning of this post speaks about buyers worrying about the tax credit. If you wish to take advantage of the tax credit and you want to buy a short sale, you realistically only have about 2 maybe 3 weeks left in which to write up an offer in hopes of getting it accepted by the deadline (and subsequently closed by the June 30th deadline).

If you see a home you know is a short sale that you want to buy. Contact me, I will help you write up an offer and work with the sellers agent to get your offer accepted as soon as possible.

One of our primary responsibilities as your realtors is to keep our finger on the pulse of the market–short term and long term. If you have any questions about the real estate market or investment strategies, please give us a call.

Borrowers who make a 3.5 percent down payment in connection with an FHA-insured loan will be required to have a credit score of at least 580. Credit scores less than 580 will require a 10 percent down payment.

Eventually, more than 140,000 U.S. Census workers will count every person in the U.S. The big question is – how do you tell the difference between a U.S. Census worker and a con artist?

U.S. Census workers have a badge, a handheld device, and a Census Bureau canvas bag. Ask to see their identification badge before answering any questions. As a safety precaution, never invite anyone you don’t know into your home. Currently, Census workers are only knocking on doors to verify address information, so if you are asked for any information outside of the address, decline to answer. The Census bureau has decided not to work with ACORN, so do not provide any information to any ACORN workers claiming to represent the Census Bureau.

The U.S. Census Bureau (USCB) will be sending out packets in the mail to verify information on name, genera, age, race, ethnicity, relationship, and whether you own or rent. If you provide your answers via mail as requested, you will be through. However, if not, then the USCB will begin going door to door between April and July to obtain this information. Every household will be part of the census.

What the USCB does NOT ask:

• Will never ask for your Social Security Number.
• Will never ask for your banking information.
• Will never ask for credit card information.
• Will never ask for donations to any charities or organizations
• Will NEVER CONTACT YOU BY EMAIL.

Email scams are the easiest to fall victim to. The USCB does not operate via email, so do not answer any questions via email.

For more information about 2010 Census, visit http://www.2010census.gov

As part of a plan to stimulate the U.S. housing market and address economic problems, Congress has passed some legislation allowing for first-time home buyers to take a tax credit of up to $8,000 as well as a $6,500 tax credit to current home owners buying a new or existing home.

Some consumers and media outlets don’t have a clear grasp of just how this program works, so please allow me to provide a basic overview.

Who Qualifies for the Extended Credit?

First-time home buyers (e.g., someone that has not owned a home in the past 3 years) who purchase a home between November 7, 2009 and April 30, 2010.

Current home owners purchasing a home between November 7, 2009 and April 30, 2010, who have used the home being sold or vacated as a principal residence for FIVE CONSECUTIVE YEARS within the last eight.

Which Properties Are Eligible?

The Extended Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops.

How Much Is Available?

The maximum allowable credit for first-time home buyers is $8,000. The maximum allowable credit for current homeowners is $6,500.

How is a Buyer’s Credit Amount Determined?

Each home buyer’s tax credit is determined by two factors. The first is price. The homes purchase price can not be for more than $800,000. The second is income. Income can not exceed $125,000 for a single income, or $225,000 for a married couple.

If the Buyer(s)’ Income Exceeds These Limits, Can He/She Still Get a Credit?

Yes, some buyers may still be eligible for the credit. The credit decreases as income increases. However, if the income exceeds $145,000 for a single income, and $245,000 for a combined income, the buyer(s) are not eligible for the credit.

Can a Buyer Still Qualify If He/She Closes After April 30, 2010?

Under the Home Buyer Tax Credit, as long as a written binding contract to purchase is in effect on April 30, 2010, the purchaser will have until July 1, 2010 to close.

Will the Tax Credit Need to Be Repaid?

No. The buyer does not need to repay the tax credit, if he/she occupies the home for three years or more. However, if the property is sold during this three-year period, the full amount credit will be recouped on the sale.

Hopefully these answer the most common questions in regards to the tax credit. If you have more questions about whether you qualify or not, please contact our office and we will be glad to help you figure out your credit amount and how it can benefit you in the purchase of your next home.

Well, not so fast. The recent increase in foreclosures prompted Congress to look into the rights of tenants who remain in the property after a foreclosure. It used to be that a foreclosure sale would extinguish any current lease and the occupants would be “tenants-at-will”, and given or subject to a 5 day vacate the premises notice.

Now, with a new law passed by Congress this May, residential tenants who have entered into a bona fide lease, prior to the notice of foreclosure, is not a relative of the owner, and continues to pay rent, the occupant may stay on the property for the duration of the lease PLUS 90 more days. If it is a verbal, or a month to month lease, then the tenant may stay 90 days after the foreclosure sale.

If the lease was entered into after the notice of foreclosure, the lease may be considered void.

Since we are a full service broker that does both property management and real estate sales (including short sales and pre-foreclosures), we are uniquely positioned to help you with such issues. If you are on either side of this equation, give me a call and I can get you the basics. If your situation doesn’t fit in the normal box, I can refer you to a competent attorney to help you with your case.

1. Percentage drop from current rate. This is the one people think about the most. The general rule of thumb is if the rate drops by more than one percentage point, it is good to refinance. Point drops of less than a point can often cost the barrower more in fees than they will save over the their life of the loan.
2. Loan amount. This is an important exception to rule #1. If the loan amount is high even a drop of a half a point may make perfect sense. For example, the principle and interest payment on a $500,000 mortgage at 6% is $2997. At 5.5% the payment drops by $158. If it is a low cost or no cost loan, then go for it.
3. How long are you going to keep the loan? People are often surprised when I talk them out of refinancing because they plan to be in the house only another year or two. The extra interest paid in that short period will not overcome the cost of the new loan.
4. 30 Year or 15 Year loan? Often the 15 year loan is a better rate, but my advice to most people is to get the 30 year loan and make the 15 year payment. The 30 year loan will be slightly higher rate, but it gives some payment flexibility if times get tough. If I’m giving the advice to someone who has a very low debt to income, I’ll suggest the 15 year note. The payment will be a bit higher, but the savings in interest will pay dividends in the long run.

Obviously this is just a start and there are many factors to consider. If you are wondering if the time is right for you to refinance, give me a call, and I can walk you through all of your options.

This new bill extends the tax credit to homes that are closed by June 30, 2010. The caveat is that your purchase contract must be agreed to by all parties on or before April 30, 2010 in order to take advantage. This is fantastic news for those waiting out the slow winter months in order to buy a home in the spring. With interest rates at record lows and home values in area’s of Salt Lake holding steady, and in some cases going up, it appears the bottom of the crash may be over in Utah and that with all the incentives currently in place, now is the best time to buy.

On an even better note, the bill also allowed existing home owners the opportunity to take advantage of a $6,500 tax credit if they choose to buy a new home. “New” doesn’t mean new construction, it means sell their existing home and purchase a home that is “new to them”. If a homeowner has owned a home for at least 5 years, you can now sell your home, cash out equity, and upgrade into a larger, newer, more affordable home and get a tax credit to boot.

If you would like to know more information or want to see what your options are, call me today. Here is a link to a Wall Street Journal article about this bill.