Realty As Is

The End of Homes selling and The Home Buying Tax Credit

Tom Winand — Fri, 30 Apr 2010 15:14:06 +0000

We’ll it here feared by many realtor and economists the tax credit end. What will it mean and is there a chance it will come back. There has been a lot of interest in buyers that can qualify to get in before the end. The home across the street from me in the avenues is for sale and I saw a young couple looking in the windows and I took the opportunity to grab my realtor key and let them in. Darn they had a realtor and they were making the final decision to buy Wondering if I Street was too busy a street. I said yes there is that and the bullet bike race up at like 2 am every Friday in the good weather but there is one huge factor that makes it the best street in the Avenues. It’s the emergency route for the fire and hospital so it’s always cleared of snow first. They put ice melt down before snow starts and never stop. Most of the side streets will have a foot of snow we have none.

Back to the tax credit, they were making their final decision for an offer. No short sales just real homes they can buy and they would make it tomorrow. So yes there will be a lot of homes put under contract over the last month probably ½ will actually close. After that home buying will pretty much stop until November when the new tax credit will be announced because the stock market will be dipping under 10,000 and the National Association of Realtor will be lobbing up a storm. For the realtors out there; it’s going to be an investor summer start learning the auctions and you’ll make it to fall.

To summarize The Tax Credit for Home Buying will be a big success. It will be talked up by all. It will end and not be extended. In August the home buying # will begin to fall. September will be record lows, in housing stocks will tumble and the government will look for the National Association of Realtors to lead the rally call we need a bigger better Tax credit. It will be voted on and pass we’ll hear Barry Frank babble on about it and our president will have a really good Photo opt and VP may say it a really freaking big deal. There will be lots of bipartisan grand standing. What should happen is FHA should be a 100% loan and that would solve the problem and not waist all the money we’re doing with tax credits. Were a silly country some times. Fix the problem of down payment and underwrite the way it’s done now. They have to have real stable income to get a home. That will get a study housing market back on its feet. Not Tax Credit Gimmicks.

Buying at the Foreclosure Auction

Tom Winand — Fri, 30 Apr 2010 14:32:28 +0000

I have not posted in a while but I have been working on the real estate front. One thing I have been doing is attending and researching foreclosure auctions or trustee sales. After a little learning it’s pretty straight forward. A bank has a trustees sale and they sell the property where is as is and to what position they are selling. They make no claims and they don’t tell you what position they are selling. So if a first mortgage forecloses and has a sale you get the home with and taxes and that’s it. If a 2^nd 3^rd or lowered lien foreclosures you get it to the point that lien is in. Most of the time it’s the first mortgage foreclosing and you get the property with any taxes owed. That can include any property taxes and any income tax so you have to do your home work and it’s a good idea to have a tile search and insurance on the home. That’s not easy and you will have to do your home work before hand.

Today were going to Utah County to buy a home that one of my clients has been trying to buy on a short sale for 5 months. The Bank J P Morgan Chase has decided to auction it rather than accept a $195,000 full price offer and a note from the previous owner for $18,000. Crazy! They will probably accept $175,000 at auction and have a foreclosure. There are 2 property the investor I am working with will be bidding on we’ll keep you posted. It’s nice to have the one property with our buyer all ready moved it so we can bid knowing they want it. If the bank puts a reasonable offering price on it of $180,000 or less we’ll buy it and sell it to our clients if not we’ll but the other home in Springville and sell them that one . It’s a $175,000 open bid and worth about $210,000.

A little More about Foreclosure Auctions form MSN

Going Green

Tom Winand — Sun, 28 Feb 2010 01:11:50 +0000

This is one of the best green renovation videos I have seen on making your home green.

You and really benefits form fallowing the tips on home to do some home owner green remodeling.

How to avoid the Tax Credit selling Train Wreck in Salt Lake

Tom Winand — Sat, 20 Feb 2010 18:28:03 +0000

From now until the end of April in Salt Lake County, there will be more offers written on homes for sale then there will be in all of 2010. Good news for home seller Right? We’ll maybe if you keep your guard up. I have to say the 2010 Home Bing Tax Credit expiring at the end of April will cause a real train wreck of buyer putting in multiple offers on lots of peppery and not really having intentions or means to buy them all. I talked to one buyer that has 6 offers in on short sales and said they would take the first one. I would bet there will be a lot of buyer doing the same with short sales and also having a non-short sale in the mix. I would bet the contract would go something like this closing on or before June 25 2010. I would bet the loan denial date would be like June 20 so they can back out of the transaction If they get a short sale a great deal and the poor home sell missing selling their home and because they Tax credit won’t be extended this time for a couple of months they will probably sell for a lot less money. The government is pulling out of subsidizing the home buying industry. They are raising the Treasury Bill rate and they will probably end the home buying tax credit. The reality is the real estate market in the country will come to a screeching halt in Aug and Sep so then they will act in November to the crisis. The government will get all in arm’s Barany Frank will get up and tall like he a concerned government superhero that know everything and it will be big news and big grandstanding and a new Tax credit form Nov 2010 to April 2011 will come out pretty much the same as today’s is it will have first time home buyers credit of $8,000 and 2^nd home buyers credit of $6,500 it they have owned for 5 years.

Back to my point how do you as a home owner not miss the best selling time with a bogus offer? We’ll you take a little piece of the short sale addendum allowing the property to stay on the market active because the offer is not binding. You can have multiple offers to buy the seller can accept all in order. The seller accepts an offer in first position and gives them a first offer the right to match the offer. Match what you say Price and ability to close. So there is no binding contract until the buyer shows the ability to close. Make the primary offers earnest money (at least 1% of sales price) non-refundable unless the inspection finds an undisclosed pertinent and substantial fact that affects the value of the home such that it will deter future home buyers, that he seller is unwilling to correct. So not the first offer ready to close force the primary offer to step up and match it or lose their earnest money if they back out. You may want to do 2% that how strongly I believe seller will be take advantage of in this crazy buyer purring in multiple offers. Some buyers will not disclose they have a home to sell. All listing agent should put a Q & A addendum do you own another home. Will you have to sell or rent the home to qualify? Then get a Pre Qualification letter stating the lender knows of this and they buyer qualifies without selling the home.

If you’re an agent or sell take this to heart it will be happening making offer on multiple property. It’s probably unethical if you don’t disclose it to the seller but agent think they can just put in contingency that will allow the buyer to back out. Like financing oh they can’t buy 2 home so they don’t qualify. Right we need to hold this kind of activity accountable but how?

Pricing your home in Salt Lake

Tom Winand — Fri, 19 Feb 2010 17:45:00 +0000

In pricing your home to sell it should have no relationship to what you own what you need to buy another home with 20% down. It never ceases to amaze me when a seller says I need this much that why I priced it at x. Buyers don’t care about what you need! Buyers care about getting the best home that fits there need at the best price they can get it. The # 1 thing in pricing is you have to be a buyer not a seller! So you have to look at the market as a buyer. Actually you have to evaluate the market in regards to buyers and market placement. So you compare your home to all the similar home that have sold, like to like, as an appraiser would. You use the same style same size + or – 10% and you take the closest and most recent sale. Not the highest sales subtract and seller paid concessions and you have a rough appraisal value. That actually means very little in pricing your home! It will tell you if you have an appraisal problem because no lender will lend more than the appraisal and no buyer will pay more for a home then its worth in this market.

Now you have a starting point. You then that that price range + and – 20% and look at all home in that price in any area a buyer would look at it looking at your home. So that may be 2 or 3 areas. Like Sugar house the Avenues and the President Streets and ABC Streets, even the Canyon Rim areas. Now you have your competition and you have to look at the # of homes. You need to know the # that go under contract and the # that sell in 60 days divided by 2. That will tell you the kind of market you are in or the absorption rate. The facts are if the absorption rate or the time in month it takes to sell the entire inventory is over 4 months you have a buyer’s market and over 6 months you have a decreasing market. The higher the absorption rate the more drastically decreasing a market you have. If you in the 6 or higher range you need to be aggressive actually 5% below your current market value or you will lose money chasing a market. Lower then 6 you can be less aggressive like at market a little higher than the market says. What does the market say? It says you have to be one to the best 10 homes in your market because buyers will look at 10 to 15 homes. You have the look that part online, if you’re not on the MLs you have to be on the 10 or so major sites they get 15% of the buyers seeing your home. If you’re on the MLS they will all see your home? You must have a great virtual tour or e-curb appeal. You have to have great appeal and great price per sqft and you have to Wow in Price and Wow in virtual curb appeal or your pricing strategy means nothing. How do you get all this data it available from the MLS and you will need a Realtor to pull it for you? It will take about an hour and I do them on a personal webinar and we do it together. Happy pricing and if you’re not getting offers in 30 days other than, crazy people wanting you to owner finance them, you’re probably priced too high! How much? You don’t want to be chasing a decreasing market; the answer is in the data. If you don’t what to know the absorption rate you can still price off the competition. How to do that is use the search on SpottedHome.com it’s a great map search. Hint register and save your closest competition in your favorites and only your competition and you will get price updates on them and other new listing like them automatically to your emailed. Your daily update will be automatic and you’re up to date so you’ll know what going on and how you compete. If you want to be on the MLS so you can guarantee your exposure to all the buyers look at my pay for service listing MLS site. http://forsalebyownerhelper.com Happy Pricing!

What Makes Up Your Credit Score

Tom Winand — Fri, 19 Feb 2010 03:18:23 +0000

What make up your credit score and how can you improve it!

FDIC Pays West One Bank to Foreclose on Home Owners

Tom Winand — Mon, 15 Feb 2010 19:33:38 +0000

This is a great article on the How the FDIC really doesn’t want loans modified and they are putting our money up to prove it.

IndyMac, OneWest Bank, Taxpayers and the FDIC. Looking Into the Deal Between OneWest and The FDIC and Applying Math To The Resulting Shared Loss Agreement. – The Lim Team Real Estate

Video on the FDIC and West One Bank causing foreclosures FDIC spending your tax $ paying West One Bank formerly know as IndiMac Bank to Foreclose on there loans.

FDIC Paying for Foreclosure Click the Picture

Will they Walk Away from Mortgage in Salt Lake

Tom Winand — Wed, 20 Jan 2010 05:37:32 +0000

Is it better to walk away from your mortgage?

Interesting NPR Talk Of The Nation program about people walking away from their mortgages. We’re continuing to see upside down home values in Utah so we can expect to see more Owners in this situation here in Utah. What do I think it would take for most families to consider walking away from their home and allowing the bank to have their house? Well, if you’re 25% upside down or more on a home that was valued at $500,000 in 2006, and is now valued at $350,000 then you are probably looking at 10 years before your home reaches back up to a $500,000 value. In the high value or hardest hit areas; like Herriman, Riverton, Saratoga Springs, Lehi, and Eagle Mountain in Utah county the depreciation can be as high as 60%. If you purchased or refinanced for 100% in 2006 or 2007 you probably are 25% to 30% upside down on you home. I definitely see people walking away when even a short sale can’t get approved. The real estate community is very active in listing short sales but the banks, especially the 2nd mortgage holders, are not cooperating. I currently have 3 short sales where the 2nd mortgages are causing a foreclosure because they want too much money for their payoff or they just wait too long for the first mortgage holder to make up their minds.

I have one friend that walked away from his home. Well, he is actually still living in the home even though it was foreclosed on 6 months ago. The bank never contacted him. He lives in the earth slide area of North Salt Lake. In this case, he stopped paying his mortgage because the home was worthless and the area will soon get condemned. I’m amazed the city hasn’t done that already with the gas lines moving as the ground shifts. One break and a home could fill up with gas and then a simple spark and then boom. The whole neighborhood would be gone. That’s really scary and people’s lives are at risk! When your home is condemned the City does not buy it, so you still own it and you’re still responsible and you can’t live there. Usually you have to remove the home at your own expense. I was over at this friend’s place awhile ago and saw his neighborhood and 2 homes were condemned because they were literally breaking apart. There are 8 inch gaps in the roads where it has split. He said there are Qwestar trucks sniffing for gas leaks every day. It’s not a matter of if, it’s a matter of when. I guess I can’t blame them for walking away.

Listen to the NPR show on the topic and tell me what you think. I can say from the voice of my 16 years of Mortgage experience, its much better on your credit report to have a situation dealt with quick even with a bankruptcy, rather then going through years of late payments and struggle. A short sale would be preferable to a foreclosure or walking away. Let’s be clear, that I don’t in any way condone not paying your bills or mortgage.

Now also allow me to have a straight look at the financial or reality of it all. After all, this is the REAL Real Estate News! If your in an area where your home is upside down by $100,000 or more you will not see that kind of appreciation for maybe 10 years or more in the Salt Lake Valley. That is unless they bring back stated income and stated asset loans. That is not happening any time soon! We’re in for a year of continued downward adjustment then many years of flat to slight increases. So you’ll end up paying an extra $100,000 on an underwater mortgage over the next 10 years at 5% interest. The numbers are $5,000 a year in interest or $50,000 in interest for 10 years. Wow, now you are at break even on your home! Isn’t that sobering when you look at it that way? So you pay $50,000 over 10 years or do a short sale and buy a similar home again in twelve months, but pay $100,000 less. In 10 years you would have $100,000 in equity and $50,000 less in interest paid. A $150,00 swing represents a lot of financial future for a family. Now for the bad news: what are the credit implications of your choices and the impact on getting a mortgage in the future? If you do a short sale you can buy another home in 12 months after your last late payment because of a hardship or buy again after 3 years if the short sale was debt related. If a Chapter 7 bankruptcy is involved then you wait 2 years after discharge before you can purchase again. With a chaper 13 bankruptcy you can purchase in 12 months with trustees approval. A foreclosure will keep you from a mortgage for a minimum of 3 years. All of that is on the current FHA guidelines. Just like NPR says, it’s a hard conversation for a family to have . What do you think, please comment!

Staging your home to sell

Tom Winand — Wed, 06 Jan 2010 07:00:54 +0000

Staging Ideas to get your home ready to sell. De-clutter and take out 1/3 of the furniture and you’ll be on the way.

Tell me what you think.

IRS First Time Home Buyers Tax Credit Problems

Tom Winand — Thu, 31 Dec 2009 20:15:55 +0000

Treasury Inspector General for Tax Administration estimates that 73,799 taxpayers have incorrectly claimed the first-time home buyer tax credit. National Association Of Realtors Source: The New York Times, Lynnley Browning (12/22/2009)

Don’t make a mistake now the Rules

Know the IRS Laws on the First time Home Buyer Program First Time Home Buyer Tax Credit Law 2010

What has changed for 2010 form 2009 First Time Home Buyer Tax Credit 2010 update

Good Luck with using the Tax Credit don’t get in trouble and Yo can always call me for questions.

A great Video on the First Time Home Buyers Tax Credit.