Homeowners win big with extension and expansion of federal tax credit
The U.S. House of Representatives voted 403 to 12 to extend and expand the home buyer tax credit. The bill passed the U.S. Senate Nov. 5,2009 and now will go to President Obama for his signature, where it is expected to be signed this week.
The tax credit will be extended through April 30, 2010, with a 60-day extension if a binding contract is in place prior to the deadline. First-time home buyers will continue to receive a tax credit of up to $8,000, while existing homeowners will receive a credit of up to $6,500. Existing homeowners will be eligible for the $6,500 if they have lived in their current residences for at least five years. The bill also will increase the qualifying income limits from $75,000 for single tax filers and $150,000 for joint filers to $125,000 and $225,000, respectively. The purchase price of the home is capped at $800,000.
Under additional provisions in the bill, taxpayers can claim the credit on purchases completed in 2010 on their 2009 income tax returns. The bill maintains the provision that home buyers do not have to repay the credit, provided the home remains their primary residence for 36 months after purchase, and waives this requirement for active duty military personnel who move due to a military order.
For weeks, the CALIFORNIA ASSOCIATION OF REALTORS (C.A.R and its members have urged Congress and the U.S. Senate to extend and expand this crucial piece of legislation.
Nationwide, more than 1.4 million first-time home buyers were given the opportunity to become homeowners as a result of the Federal Tax Credit for First-time Home Buyers. According to C.A.R. research, nearly 40 percent of first-time home buyers surveyed said they would not have purchased a home without the federal tax credit, and approximately 70 percent said the tax credit was "the most important" or a "very important" factor in their decision to buy a home.
Larry Weichman is President/ Broker for Costa Mesa based Weichman Realtors. His company has served Costa Mesa since 1976. Larry also has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, his clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,100 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532
When a homeowner faces default on their mortgage, there may be two options: foreclosure or short sale. Foreclosure can be devastating, both emotionally and financially. A short sale, or one in which the lender accepts a selling price less than the amount owed, is a better option for both the lender and the homeowner.
Regrettably, nearly seven out of ten homeowners proceed through foreclosure without ever listing their home for sale. This is due largely to perceived myths about the process, and we need to put a few of these misconceptions to rest.
First, homeowners assume the bank would rather foreclose than accept a short sale. Not true - foreclosure is often more costly for the lender, and short sales often sell for more than foreclosed listings. The banks are trying anything possible, within reason, to avoid the foreclosure process.
Next, homeowners believe there is a stigma attached to short sale listings, and that buyers have no interest in such properties. Not true - to the contrary, many smart buyers are specifically seeking out such offerings for the value they present compared to traditional listings.
Finally, homeowners often assume that there's not enough time to close a short sale before foreclosure is final. Not true - foreclosure is a lengthy process and there is time to negotiate a better result, but you need to start today.
Larry Weichman is President/ Broker for Costa Mesa based Weichman Realtors. His company has served Costa Mesa since 1976. Larry also has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, his clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,100 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532
An article appeared recently in the New York Times that beautifully illustrates the opportunities today's real estate market offers. A mother working two jobs saved up for a down payment and managed to buy a large home with a pool for $187,000. Three years ago, that same home had sold for $370,000!
While sellers are still feeling pressure, buyers with stable incomes and good credit histories are beginning to spread a "feel good" vibe throughout the industry. Conditions have literally never been better for first-time buyers. Affordability has seldom been higher and interest rates have hardly been lower. Selection of inventory is vast, and sellers are highly motivated.
As more buyers enter the marketplace, the ripple effect will be felt far and wide. When they purchase a highly affordable foreclosure or "short sale," they have removed a distressed property from the listings, improving values for other homes in the area. When they buy a "traditional" listing, that in turn sets off a chain reaction whereby the sellers in turn will purchase another home, from sellers who will in turn buy another home, and so on and so on.
You probably get the picture now. As we approach some stability in real estate, all indications are that prices will begin rising again. As the market approaches recovery, don't miss your opportunity for the buy of a lifetime.
Larry Weichman is President/ Broker for Costa Mesa based Weichman Realtors. His company has served Costa Mesa since 1976. Please direct your questions to Larry@TeamWeichman.com or call 714-241-4532. You may also visit www.TeamWeichman.com.
The conclusion of the first half of the 2009-10 legislative session has brought many new laws that may affect California REALTORS® and their clients. Not surprisingly in the subprime aftermath, prominently featured among the new laws is stricter regulation of the mortgage lending industry.
REO Buyer Can Select Escrow and Title: Effective October 11, 2009, the Buyer's Choice Act prohibits an REO lender selling residential property up to four units from directly or indirectly requiring the buyer to purchase escrow services or title insurance from any particular company. A buyer, however, who has received written notice of the right to make an independent selection, may agree to the REO lender's escrow or title recommendations. An REO lender that violates this law can be held liable for three times the charges the buyer incurred, whereas a violation by the seller's agent may be subject to license disciplinary action. This law expires on January 1, 2015. Assembly Bill 957.
No Advance Fee Loan Modifications: Starting October 11, 2009, a new law prohibits anyone from claiming any compensation for negotiating or arranging a loan modification until after that person fully performs each and every service as promised. Aimed at combating loan modification scams, this ban applies to upfront fees collected by real estate agents and attorneys. The ban expires on January 1, 2013. Also effective immediately, anyone who negotiates or arranges a loan modification must give the borrower a specified notice that paying a third-party for loan modification services is unnecessary. These new requirements apply to mortgage loans secured by residential property up to four units, with certain exceptions for lenders and loan servicers acting on their own behalf. Violations can be penalized by, among other things, a $10,000 fine plus one-year imprisonment for individuals, or a $50,000 fine for businesses. Real estate brokers with existing Advance Fee Loan Modification Agreements reviewed by the Department of Real Estate (DRE) can no longer, as of October 11, 2009, enter into these agreements or collect advance fees. Agreements entered into and advance fees collected before October 11, 2009 are not affected. For the DRE announcement, go to http://www.dre.ca.gov/pdf_docs/SB94WebAnnouncement(brokers).pdf. Senate Bill 94.
Advance Fee Redefined: Aside from loan modifications discussed above, Senate Bill 94 also broadens the definition of an advance fee which must be specially handled by real estate agents, such as by submitting an advance fee agreement for DRE review and placing funds received into a broker's trust account. Under the new definition that took effect on October 11, 2009, agents cannot separate advance fees or services into components to avoid the advance fee requirements. More specifically, an advance fee is now defined as "a fee, regardless of the form, claimed, demanded, charged, received, or collected by a licensee from a principal before fully completing each and every service the licensee contracted to perform, or represented would be performed." Exceptions include advertisements in newspapers of general circulation, tenant prescreening fees, and tenant security deposits. Senate Bill 94.
Mortgage Loan Originators Regulated: Beginning in December 2010, a real estate licensee acting as mortgage loan originator must obtain a license endorsement, which entails education, written testing, and reporting requirements. A mortgage loan originator is anyone who, for compensation or gain, takes a mortgage loan application or offers or negotiates terms of a mortgage loan for residential property containing one-to-four units. Exemptions include real estate agents who only engage in selling, buying, or leasing activities, unless compensated by a lender or mortgage loan originator. This license endorsement requirement comports with the creation of a Nationwide Mortgage Licensing System and Registry under recent federal law. Finance lenders and residential mortgage lenders under the Department of Corporation must also register in the nationwide system. Additionally, if a real estate broker or the broker's salesperson makes, arranges, or services loans secured by residential property containing one-to-four units, the broker must notify the DRE by January 31, 2010 or within 30 days of commencing such loan activity, whichever is later. Senate Bill 36.
Mortgage Broker Activities Restricted: Commencing January 1, 2010, a mortgage broker will be deemed a fiduciary with a duty to place the borrower's economic interest above his or her own. This fiduciary duty pertains to a mortgage broker who makes loans secured by residential property of one-to-four units. Also starting January 1, 2010, the law will strictly regulate higher-priced mortgage loans as defined, including requiring upfront disclosure if a mortgage broker only arranges higher-priced mortgage loans, restricting prepayment penalties and yield spread premiums, prohibiting negative amortization, and prohibiting mortgage brokers from steering borrowers to higher-cost loans. Assembly Bill 260.
Appraisal Industry Oversight: The Office of Real Estate Appraisers (OREA) will have regulatory oversight of appraisal management companies, which gained prominence after Fannie Mae and Freddie Mac adopted the Home Valuation Code of Conduct (HVCC). Starting January 1, 2010, the OREA must implement a registration system for appraisal management companies, including fingerprinting and background checks for persons with operational authority as defined. On a separate note, this law clarifies what conduct constitutes improperly influencing the appraisal process by anyone with an interest in a real estate transaction. Such prohibited conduct includes withholding or threatening to withhold an appraisal fee, withholding or threatening to withhold future appraisal business, and promising future business, promotions, or compensation. Senate Bill 237.
Mortgage Fraud Becomes a State Crime: As of January 1, 2010, anyone who deliberately makes any misrepresentation or omission during the mortgage lending process with the intent of influencing that process will be guilty of mortgage fraud under California law. A violation of this law is a crime punishable by one-year imprisonment. Under existing federal law, loan fraud against a federally-insured lender is a crime punishable by a $1 million fine, plus one-year imprisonment (18 U.S.C. section 1014). Senate Bill 239.
Increase in Homestead Exemptions: Coming into effect on January 1, 2010, the homestead exemption protecting a homeowner's equity from judgment creditors has been increased by $25,000 across the board to $75,000 for individuals, $100,000 for married couples or family units as specified, and $175,000 for persons over 65 years, disabled, or over 55 years with limited income as specified. Assembly Bill 1046.
60-Day Notice to Terminate Tenants Extended: Existing law generally requiring a 60-day notice to terminate a month-to-month residential tenant, which was originally slated to sunset on January 1, 2010, has been extended indefinitely. A 30-day notice to terminate is sufficient if the tenant has lived in the property for less than one year, or if the landlord has sold the property and certain requirements are met as specified in our standard-form Notice of Termination of Tenancy (C.A.R. Form NTT). The 60-day notice requirement does not apply to fixed-term leases, such as a one-year lease. Other laws address tenants in properties foreclosed upon. Senate Bill 290.
Other Significant Laws: Other new laws that may interest REALTORS® include, without limitation, the following:
Landlord Utilities: Requires certain utility companies to notify residential tenants of landlord's past due accounts and upcoming shutoffs, and allows tenants to begin service in their own names and deduct payment from rent (Senate Bill 120).
Mobilehome Parks: Prohibits management from requiring a homeowner to use a specific broker or dealer when replacing a mobilehome or manufactured home on a space in a mobilehome park (Senate Bill 804).
Swimming Pools: Requires anti-entrapment devices for owners of apartment buildings, condominium complexes, and others, including the filing of compliance statements (Assembly Bill 1020).
Mechanic's Liens: Provides new procedures, including service of a Notice of Mechanic's Lien to the owner and mandatory recording of a lis pendens when enforcing a mechanic's lien (Assembly Bill 457).
Low Water-Using Plants: Renders unenforceable any HOA provision prohibiting landscaping with water-efficient plants in common interest developments (Assembly Bill 1061).
Reverse Mortgages: Provides new disclosure and other requirements under the Reverse Mortgage Elder Protection Act (Assembly Bill 329).
Disposal of Records: Shields from liability businesses that dispose of abandoned records containing personal information by shredding or erasing, and gives a legal presumption that a tenant owns records remaining on the premises after tenancy termination (Assembly Bill 1094).
Plumbing Fixtures: Provides new disclosure and other requirements for water-conserving plumbing fixtures effective on or after January 1, 2014 (Senate Bill 407).
This information is courtesy of the California Association of Realtors.
Larry Weichman is President/ Broker for Costa Mesa based Weichman Realtors. His company has served Costa Mesa since 1976. Larry also has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, his clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,100 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532
With millions of dogs and cats as members of American families, there's a good chance that you've got pets sharing the home you're trying to sell. Since not everyone enjoys the company of animals, there are some measures you should consider taking before prospective buyers come over for a showing.
Pet odors are the biggest problem sellers face, but they can be easily minimized with thorough cleaning and vacuuming, and vigilant duty with the litter boxes. Black lights are available that help you to pinpoint the origin of any mysterious smells. It also makes a good impression if you pick up and store toys, bedding, and food and water bowls while your home is being shown to buyers.
If at all possible, take your dog(s) out with you when an agent brings visitors, or ask a friend or family member to keep your pet during the initial listing period. This will help reduce the stress on your pet at a time when showings are usually more frequent.
Another way to put buyers more at ease with their purchase is to offer a cleaning credit or allowance. Even if you're certain you'll remove all evidence of your beloved pets before vacating your home, the buyers may not share your confidence.
Why not offer these gestures of good will, thereby encouraging a better offer from the buyers?
Larry Weichman is President/ Broker for Costa Mesa based Weichman Realtors. His company has served Costa Mesa since 1976. Larry also has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, his clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,100 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532
Hello Football Fans! Costa Mesa United will be presenting the Battle of the Bell Pre-GameBBQ on Friday, October 16 from 4-7 p.m. Tickets are $10 each and include dinner catered by Newport Rib Company and a Live Band. Admission to the game is not included. Game time is 7 p.m. with the Eagles battling the Mustangs to bring the bell back to EHS! Join us for a great night of competition and community spirit.
Tickets purchased in advance from EHS Football Boosters benefit Estancia High School Football. Please let me know if you are interested and I will deliver the BBQ tickets to you prior to the big game.
Thanks in advance for your support! GO Eagles! LORI JARMACZ jarmacz@prodigy.net Please email Lori for tickets! This is a great event! Weichman Realtors has been a long time sponsor of Football in Costa Mesa and Costa Mesa United! Laurie and me hope to see you at the game! Larry Weichman
Larry has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, my clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,100 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532
Low prices, historically low mortgage rates, and tax credit incentives offered to first-time buyers, provided support to the California housing market to remain solid in the late summer. Despite a decline of 5.1 percent from the prior month, the seasonally adjusted annualized sales of existing single-family homes in August exceeded 500,000 for the twelfth consecutive month, and increased 9.0 percent year over year to 526,970 from 483,400 in the same month of last year. For the first eight months of the year, sales were 38.2 percent ahead of last year on a year-to-date basis.
The August median price increased 2.6 percent month-to-month to $292,960 from a revised July figure of $285,480, but declined 16.9 percent from $352,730 in the same month of last year. The yearly decline, nevertheless, was the smallest in the last 20 months. In fact, the statewide median price increased for the sixth month in a row and the August median price was 19.5 percent above the recent low of $245,170 reached earlier this year in February.
The growth in price is due in part to the imbalance between supply and demand in the housing market. Although statewide sales were almost 40 percent stronger than last year on a year-to-date basis, inventory levels were 35.0 percent lower than a year earlier in August. The unsold inventory index was 4.3 months, a slight increase from 3.9 months a month earlier, but below the 7.0 month figure of a year ago. At 4.1 months, the 3-month average for the unsold inventory was well below the long run average of 7 months, and had been displaying a declining trend throughout the past 19 months.
Supply was especially tight at the low-end of the market. The unsold inventory index for homes that were priced below $500,000 was 3.4 months in August, as compared to 4.7 months for homes with price between $500,000 and $1 million, and 12.9 months for homes with price over $1 million. The unsold inventory index was at 7.0 months, 6.8 months, and 11.0 months respectively for the same month last year.
Tight inventory at the low-end market was largely attributed to the increase in the demand of entry-level homes by first-time buyers. Results from the latest CALIFORNIA ASSOCIATION OF REALTORS®' (C.A.R) "Annual Housing Market Survey" suggest that nearly half of all buyers in 2009 are first -time buyers, up from 36 percent in 2008.
First-time buyers are motivated to buy now because of the tax credit incentive offered by the federal government. According to the C.A.R. "2009 First-time Home Buyers Tax Credit Survey", four out of ten (39 percent) first-time home buyers said they would not have purchased a home if the federal tax credit for first-time home buyers was not offered. Over nine of ten first-time buyers (94 percent) were aware of the tax credit before they purchased their homes, and 72 percent planned to apply for the Federal First-Time Home Buyer Tax Credit when they file their taxes. The federal tax credit is a big factor in many first-time buyers' decision to purchase a home: 69 percent of those surveyed said that the federal tax credit was either "very important" or "most important" in their home buying decision now. The Federal First-Time Buyer Tax Credit is scheduled to expire on November 30, 2009, but a 6-month extension is under consideration at this time. An extension, if passed by the legislation, will undoubtedly contribute to the recovery in the California housing market.
Reprinted courtesy of California Association of Realtors
Larry has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, my clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,100 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
NEW CALIFORNIA LAWS FOR 2009-10
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