Archive for March, 2009

Interest Rate at All Time Low!!!!

Saturday, March 21st, 2009

Rates on 30-year mortgages plunged to a record low Thursday after the Federal Reserve launched a new effort to prop up the flailing housing market.

The national average rate on 30-year, fixed mortgages was 4.94 percent on Thursday, according to financial publisher HSH Associates, down nearly a quarter point from a day earlier. That’s the lowest on HSH’s records, which date back to 1979.

For borrowers with stable jobs and good credit, it represents an opportunity to refinance at the lowest rates in decades. But people with less-than-perfect credit are likely to pay higher rates.

Plus, some mortgage brokers were disappointed on Thursday, saying lenders had not pushed down rates as dramatically as they had hoped. Lenders that are not connected to banks and must rely on short-term funding are having trouble raising cash.

“The problem is: We’re still not seeing the injection of capital from the private sector,” said Douglas Braden, a broker with Northern Colorado Mortgage Co.

Plus many lenders, after laying off workers in droves, don’t have the capacity to keep up with a refinancing boom.

“They’re already swimming in applications,” said Greg McBride, senior financial analyst with Bankrate.com. “You could keep reducing mortgage rates, but if the lender’s already got a stack of files on his desk, he’s not going to answer the phone.”

Interest rates have drifted lower since November when the Federal Reserve pledged to buy up mortgage-backed securities in an effort to bolster the long-suffering housing market.

Earlier Thursday, mortgage finance giant Freddie Mac said average rates on 30-year fixed-rate mortgages dropped this week to 4.98 percent, down from 5.03 percent last week.

It was the lowest since the week of Jan. 15, when it was at 4.96 percent, the lowest point in the history of Freddie Mac’s survey, which goes back to 1971.

Freddie Mac’s survey included rate quotes taken before the Fed said Wednesday it will pump $1.2 trillion into the economy in an effort to lower rates on mortgages and other and loosen credit.

The average rate on a 15-year fixed-rate mortgage dropped to 4.61 percent, down from 4.64 percent last week, Freddie Mac said.

Rates on five-year, adjustable-rate mortgages fell to 4.98 percent, compared with 4.99 percent last week. Rates on one-year, adjustable-rate mortgages rose to 4.91 percent, from 4.8 percent last week.

The rates do not include add-on fees known as points. The nationwide fee for fixed and adjustable rate mortgages averaged 0.7 point last week.

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First-Time Homebuyers Have Several Options to Maximize New Tax Credit

Thursday, March 19th, 2009

Hello Buyers- here is some good basic information about getting the first time homebuyer tax credit right away or at a later date depending on what you need! I hope you will all take advantage of the only good thing happening with taxes right now!

 

As part of the Treasury Department’s consumer outreach effort and with the April 15 individual tax filing deadline approaching, the Internal Revenue Service today began a concerted effort to educate taxpayers about additional options at their disposal to claim the new $8,000 first-time homebuyer credit for 2009 home purchases. For people who recently purchased a home or are considering buying in the next few months, there are several different ways that they can get this tax credit even if they’ve already filed their tax return.

The Treasury Department encourages taxpayers to explore these options to maximize their credit and get their money back as fast as possible.

“The new credit can get money in the pockets of first-time homebuyers quickly,” said IRS Commissioner Doug Shulman. “For people who recently purchased a home or are considering buying in the next few months, there are several different ways that they can get this tax credit even if they’ve already filed their tax return.”

First-time homebuyers represent a significant portion of existing single-family home sales. The expansion in the first-time homebuyer credit will make it easier for first-time homebuyers to enter the housing market this year.

Under the American Recovery and Reinvestment Act of 2009, qualifying taxpayers who purchase a home before Dec. 1 receive up to $8,000 or $4,000 for married individuals filing separately. People can claim the credit either on their 2008 tax returns due April 15 or on their 2009 tax returns next year.

The filing options to consider are:

  • File an extension. Taxpayers who haven’t yet filed their 2008 returns but are buying a home soon can request a six-month extension to October 15. This step would be faster than waiting until next year to claim it on the 2009 tax return. Even with an extension, taxpayers could still file electronically, receiving their refund in as few as 10 days with direct deposit.
  • File now, amend later. Taxpayers due a sizable refund for their 2008 tax return but who also are considering buying a house in the next few months can file their return now and claim the credit later. Taxpayers would file their 2008 tax forms as usual, then follow up with an amended return later this year to claim the homebuyer credit.
  • Amend the 2008 tax return. Taxpayers buying a home in the near future who have already filed their 2008 tax return can consider filing an amended tax return. The amended tax return will allow them to claim the homebuyer credit on the 2008 return without waiting until next year to claim it on the 2009 return.
  • Claim the credit in 2009 rather than 2008. For some taxpayers, it may make more financial sense to wait and claim the homebuyer credit next year when they file the 2009 tax return rather than claiming it now on the 2008 tax return. This could benefit taxpayers who might qualify for a higher credit on the 2009 tax return. This could include people who have less income in 2009 than 2008 because of factors such as a job loss or drop in investment income.

The IRS reminds taxpayers the amount of the credit begins to phase out for taxpayers whose modified adjusted gross income is more than $75,000, or $150,000 for joint filers. Taxpayers can claim 10 percent of the purchase price up to $8,000, or $4,000 for married individuals filing separately.

For more information, including guidance for people who bought their first homes in 2008, visit IRS.gov. To learn more about the overall implementation of the Recovery Act, visit http://www.recovery.gov/.

  © 2009 Thomson Reuters/RIA. All rights reserved.

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Is Buying a Foreclosure Home Worth It?

Wednesday, March 18th, 2009

this is a great post by Laura Everret at Atlanta Real Estate Forum. Many of my clients ask about buying foreclosures and short sales all the time- of course everyone wants to get a deal and there is always that one story that you hear over and over like a fairy tale of a  buyer that got a $600K home for $300K and it was just perfect. I am not saying this isn’t possible but I will say that likes most things that sound to good to be true usually are!

You’ve probably seen and heard plenty of advertisements about buying foreclosed homes in Atlanta and how much money you can save. The drastically reduced prices are enticing from a distance, but what are you really getting yourself into? Repairs, location, and legal issues are among the things that potential homebuyers should think about when comparing foreclosed homes with new Atlanta homes.

The most obvious thing to consider is how long a house has been unoccupied. Anyone who has ever been a  homeowner knows that a house does not take care of itself. Who, if anyone, has really been caring for the foreclosed home? It’s very possible that you will find yourself spending more money and time than you had originally intended. Repair costs might not be included in your loan for the property, so keep in mind that you could end up paying for these repairs out-of-pocket. And remember that not everything that needs to be repaired is visible on the surface; there are probably things you never thought about like pipes that have burst, bad plumbing or wires that have gone missing.

Secondly, like any other home, you should look at its location. Is the foreclosed home in a nice neighborhood? Would you really want to buy a house in a neighborhood that is generally in bad condition? Be aware that it might be hard for you to resell down the road. Settling for a house because it costs a lot less is not always the best reason to buy. Although there are foreclosed homes out there that are worth buying, you have to be careful of the surroundings too.

Another factor worth mentioning is that many foreclosed homes do not come with a warranty. You can try writing it into an offer or asking the lender to provide a warranty, but you are not always guaranteed. When purchasing a new home, you have a builder warranty preventing your from paying out of pocket to repair anything that breaks in that time period.

The low cost of foreclosed homes is appealing, but be sure you weigh all of the pros and cons to make sure you really are getting a good deal. These are only a few of the factors you need to consider before purchasing a foreclosed home. Make sure you are a smart home buyer by getting all the information you can about the house beforehand.

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Go Green with your Spring Cleaning

Wednesday, March 11th, 2009

These are great tips to go green with your Spring cleaning and become a more “green” person! Laura Everett with Atlanta Real Estate Forum shared these and I am happy to pass them along to you! Enjoy being “green”!

Even though the recent beautiful weather would lead you to believe Winter is behind us, we are technically still in the Winter season for a very short amount of time. Spring is less than two weeks away! It’s an exciting time as flowers will be in bloom and we get to experience the brief period of time when the outside temperature is absolutely perfect (as opposed to the unbearable heat that the summer months brings). So, it’s pretty safe to say that many people will be spending upcoming weekends gardening and cleaning while taking part in the traditional “Spring Cleaning” of their home. Well, this year we would like for you to be armed with the knowledge to make your heavy duty cleaning more eco-friendly. These tips will improve the air quality in your own home as well as the environment, and most of these are really easy and simple.

  1. Give your home some fresh air by opening the windows. As I mentioned eariler, there is only a brief period of time in Atlanta when the weather is just perfect - so take advantage of it! You’ll be eliminating the dirty air circulating in your house and letting fresh, clean air in.
  2. Utilize nature’s cleaning miracle, vinegar, as your primary cleaning product. The acidic product can be used to clean just about anything you have, and it works very well. Use it on countertops, floors, carpet, windows, sinks, etc. You can even mix it with baking soda to create a cleaning-paste. You’ll be amazed how well it cleans and very happy to be using a non-toxic substitute as it will not be putting harmful toxins in the air in your house.
  3. If you do choose to purchase cleaning products, be sure to go with those that are vegetable-based. Most all manufacturers have vegetable-based cleaners on the market today, meaning it’s very easy to make the switch. The vegetable-based cleaners will reduce home air pollution as opposed to the cleaners full of heavy chemicals and other toxins.
  4. Avoid using bleach and other cleaners that contain chlorine. There are so many problems with chlorine - it burns the skin and the eyes; it can be fatal if swallowed; it becomes toxic to the natural world when sent down the drain. There are many alternatives to using bleach, including vinegar, so why not avoid the toxic bleach for something that works just as well but isn’t harmful.
  5. Reduce the amount of waste you consume by using rags and sponges to do your cleaning, not paper towels. Think of how many paper towels you use when cleaning the bathroom or kitchen? Now imagine everyone doing that? That’s a whole lot of waste when a reusable rage could easily be substituted and be just as effective.

I hope that you’ll take some these suggestions into consideration when you start your cleaning. Spring is a wonderful season in the south, and we want you to enjoy it to its fullest. So make that house of yours spotless without polluting the air in your home.

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What you need to know about the “first time home buyer” tax credit!

Saturday, March 7th, 2009

 Hello Everyone- this is a very good outline of everything you need to know about the home buyer tax credit that was just approved through the stimulus package. There are alot of questions out there and if you need answers I am happy to try and help! Here are six things you need to know about the freshly-enacted $8,000 first-time home buyer tax credit.

1. $8,000 for new buyers: The tax credit included in the economic stimulus legislation is much narrower than the $15,000.00 proposal. This credit is equivalent to 10 percent of the purchase price of the home–although it’s capped at $8,000–and applies only to first-time home buyers and principal residences. But unlike an earlier $7,500 home buyer tax credit, this one does not have to be repaid.

2. First time buyers defined: For the purpose of this legislation, a “first-time home buyer” is someone who hasn’t owned a principal residence for three years before buying a house. (The date of purchase is considered the day that the title is transferred.) That means if you’ve owned a vacation home–but not a principal residence–within the past three years, you would still qualify for the credit.

3. 2009 buyers only: Only those who purchase a home on or after January 1 and before December 1, 2009 are eligible for the credit. Anyone who bought a home last year won’t be able to take advantage of it.

4. Income limits: The tax credit is subject to income limitations. Single buyers need a modified adjusted gross income of $75,000 or less to qualify for the full credit, that’s $150,000 for married couples. Those earning more than these thresholds may be eligible for reduced credits.

5. Refundable: Because the tax credit is “refundable,” qualified buyers can take advantage of it even if they don’t have much tax liability. In other words…unlike the $15,000 tax credit, this tax credit will be refunded to a buyer, if his year end tax liability is less than the credit.

6. Recapture: Buyers have to own the home for at least three years in order to capitalize on the credit. If they sell the home before then, they will have to return the credit to the government. (Exceptions will be made in certain cases, such as death or divorce.)

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Home Owners Insurance: 101 Great Tips to Understanding How to Buy and What to Buy!

Thursday, March 5th, 2009

This is great information from Atlanta Real Estate Forum.com- a great source for all things real estate related. You should review your home owners insurance yearly to make sure coverage is accurate- if the home value goes up then you should notify your policy holder and have it adjusted- this is where most people get hit because they don’t have enough insurance to cover the repair cost from damage done.  

 

Whether you’re taking advantage of the current foreclosure epidemic to purchase your first new home in Atlanta, or are merely trying to reduce what you spend on insurance every month, there are certain questions you probably have. Among them: What do you really need in the way of coverage? How can you tell if you’re getting a good deal on your policy? The answers to these queries are different for each of us, but all are rooted in the fundamentals of homeowners policies.

What Policies Typically Cover

While the details of all homeowners insurance policies differ, most have the same three basic categories of coverage:

  • The physical structure of your home
  • The personal property within your home
  • People who enter your home as employees or guests

Here’s a breakdown of each category:

  • Physical Structure: This is the part of your policy designed to cover physical damage to your home that is caused by extreme weather or other hazards, like fire. It is this coverage that people refer to when they talk about “hazard insurance,” and it usually extends to all structures on the property, such as detached garages. Coverage of flood damage, however, is typically excluded, and requires a separate policy if you live in a flood zone.
  • Personal Property: While there are many methods of covering the contents of your home, the most common method is to simply set a value, usually a percentage of your overall coverage, though specific high-value items like jewelry and electronics may require special riders with extended coverage. To make sure your belongings are covered, you should make a habit of reviewing your inventory at least once a year. You may also want to document the contents of your home by taking pictures.
  • People Who Visit: The third part of your policy is made up of liability coverage, which addresses claims that may be filed for injuries or damages suffered by people outside your family who enter your home as employees or guests. Generally liability clauses begin with $100,000 of coverage, but this can be increased, which is advisable if you own a business or are an especially prominent member of your community.

Rate Shopping

Once you understand the components of the average homeowner’s insurance policy, you can begin comparing rates. Just as with auto insurance there are many ways you can reduce the amount you pay in premiums. Some of those methods include:

  • Take a high deductible: The higher your deductible - the amount you pay out of pocket if you file a claim - the lower your premium. Be careful - don’t agree to a deductible so high you won’t be able to pay it.
  • Safety counts: Certain safety systems, such as monitored alarms, also give you an insurance discount.
  • Bundle up: By bundling your auto and home insurance with one company, you’ll save money on both policies. Add life insurance, and you’ll get a bargain on that as well.

The methods listed above are just a few ways to reduce your premium. Be sure to ask your insurer for any discounts they may offer.

Whether you’re taking advantage of the current foreclosure epidemic to purchase your first new home in Atlanta, or are merely trying to reduce what you spend on insurance every month, there are certain questions you probably have. Among them: What do you really need in the way of coverage? How can you tell if you’re getting a good deal on your policy? The answers to these queries are different for each of us, but all are rooted in the fundamentals of homeowners policies.

What Policies Typically Cover

While the details of all homeowners insurance policies differ, most have the same three basic categories of coverage:

  • The physical structure of your home
  • The personal property within your home
  • People who enter your home as employees or guests

Here’s a breakdown of each category:

  • Physical Structure: This is the part of your policy designed to cover physical damage to your home that is caused by extreme weather or other hazards, like fire. It is this coverage that people refer to when they talk about “hazard insurance,” and it usually extends to all structures on the property, such as detached garages. Coverage of flood damage, however, is typically excluded, and requires a separate policy if you live in a flood zone.
  • Personal Property: While there are many methods of covering the contents of your home, the most common method is to simply set a value, usually a percentage of your overall coverage, though specific high-value items like jewelry and electronics may require special riders with extended coverage. To make sure your belongings are covered, you should make a habit of reviewing your inventory at least once a year. You may also want to document the contents of your home by taking pictures.
  • People Who Visit: The third part of your policy is made up of liability coverage, which addresses claims that may be filed for injuries or damages suffered by people outside your family who enter your home as employees or guests. Generally liability clauses begin with $100,000 of coverage, but this can be increased, which is advisable if you own a business or are an especially prominent member of your community.

Rate Shopping

Once you understand the components of the average homeowner’s insurance policy, you can begin comparing rates. Just as with auto insurance there are many ways you can reduce the amount you pay in premiums. Some of those methods include:

  • Take a high deductible: The higher your deductible - the amount you pay out of pocket if you file a claim - the lower your premium. Be careful - don’t agree to a deductible so high you won’t be able to pay it.
  • Safety counts: Certain safety systems, such as monitored alarms, also give you an insurance discount.
  • Bundle up: By bundling your auto and home insurance with one company, you’ll save money on both policies. Add life insurance, and you’ll get a bargain on that as well.

The methods listed above are just a few ways to reduce your premium. Be sure to ask your insurer for any discounts they may offer.

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Expert predicts housing rebound in summer

Sunday, March 1st, 2009

Great News- mimicks what I have been saying all along!!!

By KEVIN DUFFY

The Atlanta Journal-Constitution

Friday, February 27, 2009

Responding to a Commerce Department report that new-home sales in most parts of the country slumped badly in January, local experts said metro Atlanta will also fare poorly when sales are tallied.

Steve Palm, president of SmartNumbers, a Marietta research firm, said resales in January were way off, so new-home sales will be, too.

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The price spread between existing homes and new homes has reached $122,000, and “that’s the greatest it’s ever been,” Palm said. “I think we’re at a bottom now.”

He said a housing market turnaround should begin in June or July, led by existing homes because prices have plummeted. The new-home recovery will follow, he said.

In the metro area, new-home sales over 12 months were down 52 percent in December, the latest month with complete new-home data, according to SmartNumbers.

In December 2007, 3,048 homes sold in the 26-county area; last December that number slipped to 1,447, Palm said.

December sales were 283 units higher than in November, reflecting builder and developer eagerness to make year-end deals, he said.

Oversupply, escalating foreclosures and strict lending are all affecting home values, as are joblessness and weak consumer confidence.

Resale prices in Atlanta have returned to summer 2002 levels, the Standard & Poor’s Case-Shiller Index says. Over 12 months, prices in Atlanta have slipped 12.1 percent, Case-Shiller says.

According to Metrostudy, which also tracks new-home closings, sales in 22 metro counties fell 41 percent from the fourth quarter of 2007 to the fourth quarter of 2008.

Eugene James, Metrostudy’s Atlanta division director, said consumers are feeling insecure about their jobs and that’s hurting the market.

“Everyone is in a state of paranoia right now, too afraid to make any buying decisions,” James said.

He said prospective buyers have looked at homes but “the traffic just didn’t turn into writing contracts.”

The upside is inventory slipped 31 percent year to year even with meager sales because construction is almost nonexistent, James said. Smaller inventory is necessary for a correction.

The Commerce Department reported Thursday that sales fell 10.2 percent to a seasonally adjusted annual rate of 309,000, the worst showing on record going back to 1963.

It also was weaker than the pace of 330,000 that economists expected and shattered the previous all-time monthly low set in September 1981.

Only the Northeast saw sales rise in January from the previous month.

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