New Law Signed by President Bush Today-Relief for Homeowner’s?

COMMENTARY: ON THE NEW RELIEF LAW

The new law signed by President Bush today is supposed to help home owner’s … My opinion is that it is a bunch of “fluff” and won’t provide any real relief at all.  Please click the link at the bottom of the page to view the details of the law if you wish… but here are some of the noteworthy points of the new lawy:

If you qualify AND your current mortgage company will accept a loss… you can get a new loan at 85% to 90% of your current market value.  If you sell your house back you will get to keep, up to 50% of any gain (10% if you sell in a year, 20% in 2 years… etc until you reach 50%) The rest will go to FNMA.  This is actually able to help about 400,000 homeowner’s and starts as of October 1, but many believe (already) that banks will be cherry picking the best opportunities and that most of the eligible properties WON’T be helped b/c thier current lien holders (banks/mortgage companies) won’t allow the loss this way.  Most experts say that most lien holder’s will not have guidelines in place and most of this won’t happen until the first of next year too! 

So… does this really help?  Only a little in my opinion.  Especially, since over 2.5 million homes face foreclosure this year and it may increase if the economy gets any worse (and many experts predict it will get worse.)  If ALL 400,000 eligible homeowner’s were able to take advantage of the new “relief”, that is still only about 16% of the forclosures this year!

In the same law… the Nehemia program and other’s like it are no longer allowed.  This is Down Payment Assistance (basically, the seller contributes the downpayment to a non-profit organization aka Nehemia, and the organization gives it as a gift to the buyer) and although it has been hotly debated over the years whether or not it is a “good” or “bad” situation – it is still a BIG part of allowing first time homebuyer’s purchase a home.  Without it… it makes or current housing market even more troubling.  It will eliminate the chances of thousands of people being able to afford a home for the first time.  Now, in my opinion, was not the time to “crack” down on a service that has done nothing but help people afford homes.

There are other industry wide important issues in the new law that I’ll refrain from commenting on at this point - the creation of yet another new entity within the government with tighter reins on our financial system, a guarantee of a bailout for Fannie Mae and Freddie Mac, neighborhood grants, a permanent affordable housing fund, a low income housing credit, tax cuts, and… oh yeah… an increase to the statutory limit of the national debt – to 10.6 trillion (would be hard to type that many zeors… but in case you wonder what it looks like: 10,600,000,000,000 – WOW!  You couldn’t count that high in your lifetime I’m guessiong… whew!)

So… here is what I suggest -

Homeowner’s – If you CAN take advantage of the relief as a homeowner… DO IT.  It may be a long time until anything else comes along.  Please feel free to call me and I’ll help you get any information you may need.

Potential Buyer’s – Take advantage of the up to $7,500 tax credit for first time home buyer’s for buying a home from April of 2008 til July 1, 2009!  (*with interest rates on the rise… the sooner you buy… the better!)

Potential Seller’s - If you HAVE to sell – either because your are facing a potential forclosure or other reasons – SELL QUICKLY!  It is only going to get tougher to sell over the next few years.  If you are facing forclosure… CALL ME… I can potentially avert a forclosure through a short sale.  If you just need to sell… and aren’t facing forclosure - CALL ME – I can still sell your home in this market with the right marketing!

Please add your comments – I’d like to see your opinions of what the new law means to you!

Til next time… Chris

*HERE IS THE LINK TO AN ARTICLE EXPLAINING THE NEW LAW…. http://www.boston.com/news/nation/washington/articles/2008/07/30/provisions_of_housing_mortgage_relief_bill/

Why I Sell Real Estate

Yesterday, Good Friday, was a weird day.  Most of the world decided that it was time to just stop moving!  I had a lot of work to catch up on, so I decided to go on in to the office.  My day went pretty good because I was able to catch up on a lot of work.  About 3:30pm, I decided to head on home.

Just after arriving home about 15 minutes later… I received a call from someone who was sitting in front of a house I have for sale.  “Unfortuntately, that particular house just went under contract about a week ago.” I explained.  As I did, I heard a quiet, sad pause.  The caller didn’t seem to know what to say.  Understanding this (I’ve had it happen Many times before), I quickly asked “What are you looking for in a house?”  This opened the door to a much happier tone from the caller and I was able to find out exactly what they are looking for!  “I will email you a list of properties today.  Take a look at them… and email or call me back with a list of properties that you’d like to look at.  We will make an appointment and take a look at them!”  That sounded great to him.  We hung up.

Usually, I would have put off doing that for a while… an hour or so… since I had just arrived home and wanted to grab a bite to eat, watch a little tv, and relax a little.  My wife and son were visiting a friend and wouldn’t be home for an hour or so (they were painting eggs for easter!)  But, I decided I’d just go ahead and take care of it, my computer was already on… so I logged into my mls system and performed the search and sent it out. 

It wasn’t 15 minutes later (as I was starting to relax) that my phone rang… It was the buyer.  “Do you think you could show us a couple of properties today?” Let me stop the story right here… 1- I rarely show properties to buyer’s without any sort of pre-qualifing. 2- It was around 4pm on Friday… Good Friday… and I had already put in my dues for the day… I spent most of it at the office doing work… and the office wasn’t even open! 3- I hadn’t seen my wife and son all day.

What else could I do?  “Uh, O…K…”  I said.  “I just need you to email me the MLS #’s of the properties you’d like to see… no more than about 4, since it is late, and we’ll go take a look at them.  I’ll call you back in about 20 minutes, after I’ve set the appointments up to let you know where we can meet… ok?” 

“That’s GREAT!” he said.

<boing> I had email… Wow, that was quick.  I sighed, pulled them up… made the appointments… headed out… in jeans, an old t-shirt, and dirty tennis shoes (it was raining yesterday and I didn’t want to get my shoes ruined… so I wore my “cleaning” shoes.”  I called him as I left and told him which property we’d meet at first (The suspense was probably exciting for him!)

I arrived before he did… I opened up the house… opened the blinds and turned on the lights.  The house was a wreck, since the seller’s didn’t have a clue we’d be there so fast.  A car drove by slow…. I watched it from inside the house as it made a u-turn and stopped just up the street.  I knew it had to be the buyer… but I guess he didn’t feel comfortable stopping in front of the house since it had cars parked in the driveway.  Maybe, he thought the owner’s were home?  So, I walked outside and motioned him up to the house.

It was at that moment… I re-affirmed… once again… WHY I love selling real estate… Why I got into this business in the first place.  A very young couple (18 & 19 years old) opened up the doors to their car.  They wore bright, cheery smiles.  They held hands… he opens the door for her every time they get back into their car.  I learned very quickly that they had been married for 8 months and that they wanted to buy a house!  (And yeah, I finally did qualify them a little…their parents were going to be helping them out… but they get to pick the house and they are very responsible.)  They don’t know a thing about buying a home, what to look for, that this journey is treacherous, that it is important to have good representation, that people aren’t always out to help them…

What a great feeling to know that on a gloomy, slow, Friday - in the middle of this real estate market that is in such turmoil; even though the media only tells stories of the “doom and gloom”; even though I’ve been selling real estate for 10 years and don’t work with buyer’s a lot anymore… There are still buyer’s who want & NEED a professional, honest, reputable Realtor.  There are still buyer’s who NEED a real estate agent…to help them start their lives together, to represent them and their needs & wants, to help them navigate the tumutulous journey of finding a home, securing financing, negotiating an offer, working out the kinks, and closing on the deal.

It feels really good to be a real estate agent again!  And for the best reasons!

This is why I started selling real estate 10 years ago… this is still why I sell real estate…

Mortgages Just Got Harder To Get!

Unfortunately, I just read a St Pete Times Article – http://www.tampabay.com/incoming/article426162.ece  – That explains that mortgages just got even more difficult to get. 

To Summarize: To qualify for PMI (Private Mortgage Insurance) – which is something you need if you are putting less than 20% down on a house (*Unless you are getting an FHA or VA Loan) – You now have to put at least 10% down, instead of the 5% previously required.  That means if you want to buy a $200,000 house… you will need at least $20,000 down PLUS your closing costs.  WOW.  Makes it tough.  Looks like FHA Loans just became EVEN MORE favored!

Call Team Thompson if you want to find a GOOD FHA Mortgage Broker! 813-928-4357  Chris@TeamThompsonFL.com

Amendment 1 – Homestead Portability

I just wanted to take a few moments to give my clients, customers, family and friends a few links that may help them to understand the new portability features that Amendment 1 provides.

But first, I want everyone to know some things that the media hasn’t hit on too much since Amendment 1 passed:

Amendment 1 is being challenged right now.  Based on the fact that is creates an “unfair taxation” to certain groups (first time homebuyer’s, people who bought in the last few years, etc.)  Basically, if Buyer A is a first time homebuyer and buys a home exactly like the one that Buyer B buys – And Buyer B lived in a house for say… 30 years and was able to transfer some of his homestead, under Amendment 1… Buyer B will be paying a LOT less than Buyer A.  Even if they both purchase for the same price on the same day!

This is something that will probably not be resolved for a year or 2.  But, IF it is reversed… it would be very difficult for the government to get back that “portability” advantage from anyone who takes advatage of it until (IF) it is reversed.  There is a good possibility that it could be reversed too! (*I recently saw an interview with the president of GTAR – our local board – and Rob Turner – the Hillsborough County Tax Appraiser – a couple days ago.  And he stated this thought too… almost word for word!)

What this means to you:  If you are desiring to move up, down, laterally, and you have a large, positive difference in your Assessed Value vs. Just Market Value… You may be the IDEAL candidate to make a move… NOW!  Interest rates are still historically low, Prices to BUY are the lowest they have been in 30 years, and even if you lose a little more than you want to on the sale of your house… you will reap the rewards in the end with the huge tax savings you can get right now & the low price on the purchase side! 

Anyway, if you want to look into how it works… just visit the sites below:

www.hcpafl.org  – Hillsborough County Property Appraiser’s Website

http://dor.myflorida.com/dor/property/sb4d.html  -  Department of Revenue’s Site with FAQ’s on Ammendment 1

Hope this helps!