Thanks to the new California first time homebuyer tax credit that governor Schwarzenegger signed into law, first time homebuyers can qualify for a state tax credit of 5% of their purchase price, up to $10,000. Because the federal tax credit expires at the end of April 2010, if you enter into a purchase contract before the end of April, and close the esrow after May 1, you can receive the federal and state tax credits combined. The federal first time homebuyer tax credit will give 10% of the purchase price, up to $8,000. Taking advantage of both credits in the months of April can result in up to $18,000 of tax credit. This really is an incredible opportunity, and one that any of you that have been thinking about buying property, should take advantage of. If you live in California, and want to see what opportunies are available, give me a call at 800-785-4952. Fresno Real Estate
This is just a reminder that the $8,000 tax credit, awarded to first time home buyers, expires soon on April 30, 2010. This means that the signed purchase agreement for your California real estate needs to be dated no later than April 30, and the escrow needs to close by June 30. This type of free money from the government may not be extended again, so if you are thinking about purchasing property, get off the fence, give me a call at 800-785-4952, or contact a local real estate agent, and start the home search. Some of you will be pleasantly surprised at how much home prices have dropped in the last 18 months, and perhaps that home that was out of reach, is now affordable to you. Interest rates are still at a historically rock-bottom, so lets see what we can get you pre-qualified for. My California home loans website answers many questions you have about the home buying process, and all of the information is FREE. Happy house hunting!
I want to take this time to thank all of my readers, past clients, and current clients, for a memorable 2009. It sure seemed like one heck of a tough year for everyone. 2009 was marked with dramatic changes in the real estate and mortgage industries, but also in the political and economic landscapes as well. Many of you took advantage of the opportunities in this market, and bought or refinanced real estate at reduced prices with historically low interest rates, and some of you were first time homebuyers that will also receive an $8000 tax rebate next year. I congratulate you all and wish you a fantastic 2010. During this time of the year, I am reminded of how fortunate my life is, and how rich my life has become with my family and friends. It makes me think that no matter how doom and gloom the news around me may be, it is the people in my life that bring real joy and happiness to me, and with their help, I can overcome anything.
2 weeks ago, I decided to do something for charity. I always try and give during the holidays, but this year, rather than do my usual cash donations, I decided to take on a project. I set a budgeted amount to spend and went to a local "Big Lots" store. I proceeded to purchase some really cool toys. Some for older kids and some for younger kids. When I was done shopping, I delivered the toys to a "toys for tots" collection center. When I handed the bag of toys to the Marine soldier, he thanked me, and as I walked to my car, I felt overwhelmed with joy. The fact that I took the time to shop, and get toys that I liked, made this donation far more rewarding to me. I know that a child, much less fortunate than mine, will receive one of my gifts and will really appreciate it. I truly feel like I made a difference, no matter how small it is.
Today, in a similar fashion as before, I have set a budget, and will be heading to the grocery store to purchase food stuffs that a local homeless shelter needs. Their list includes mens clothing and shoes, so I have gone through my closets to get as many items as I could, to bring to the shelter. I'm super excited about today, and hope that some of you will take the time to give. I don't know how inspiring this post in fact is, but I can tell you that the feeling I had at the toys for tots center, is one that everyone that can give should want to feel. It's more than just intangible, it's real. So if you get a chance in the next 2 weeks, and you find yourself sitting around more than usual, I recommend you go on the website of any of your preferred charitable organizations, and see what they need. Take the time to put a donation together and go deliver it in person. You'll be glad that you did. Happy Holidays and have a Happy New Year! Cheers!
I recently helped a first time homebuyer acquire a beautiful home, and I let him get me away from insisting on realistic expectations, that came back to bite me. The property is such a jewel: a home on a private golf course, selling for less than half of what it sold for 3 years ago. It's on a 1/3 acre lot, a custom vintage home from the 1960s. This California real estate represented everything my client was looking for, and beyond, when we began the home search over a year ago. The home was bank-owned, and the listing was an "AS IS" scenario. While there were typical love and care issues that were needed on this REO, it had a dated roof. The sellers made it clear that they would not repair anything on the home, and would only address issues that were required by the California Mortgage lender. We discussed the possibility of an appraiser noteing the age of the roof on the appraisal, and we felt like there was a chance they would identify the roof's age. We made the offer with the client understanding that he was agreeing to buy the home as is, whether the appraiser said anything about the roof or not. An initial roof inspector suggested the roof was over 45 years old, and needed to be replaced. So my client then began to talk and brag to his friends about how this home was great, and how the roof would be addressed by the sellers. I always followed up with him stating we would do the best that we could, once the appraisal was completed, to address any issues the lender required. When the appraisal was completed, there was nothing mentioned about the roofs' age.
My client's entire demeanor changed. We went from a productive, agreeable, and respectable relationship, to a hostile, irritable one. My demeanor continued to be one of a professional, consultive approach, but now had fallen to deaf ears. To me, nothing had changed. The hopes of a roof issue being addressed on an appraisal was merely a bonus. After all, it only amounted to about 4% of the total purchase price. But to my client, over the 2 weeks we waited for that appraisal to be completed, the roof became a paramount issue that he had staked his ego on. We moved forward, and closed the escrow on-time, but in the end, my client directed his frustration at me, and was unhappy with my service.
I find it incredible on one hand that I completely succeeded in: locating the home of my clients dreams, negotiating a fantasticly low purchase price for it, secured a historically rock bottom interest rate on his California mortgage loan, and positioned my client to take advantage of the first-time homebuyer credit, and that my client could be unhappy with me. When I look back on this transaction, I will take away the one thing I should have done more forcefully, and that is to insist on realistic expectations, and not allow my clients' hopes to prevail over what can happen. It's tough to take a hit from a client I expected to receive tremendous endorsement and referrals from, over something I had no control over. Expectations should not only be discussed upfront but need to be repeated throughout the process, no matter how much your client wants to abandon them.
It's been over 100 days since the HVCC law came into effect, and I'm throwing in the towel on this one. What a disaster. The HVCC law "protects" borrowers and lenders by preventing mortgage pros from speaking directly with appraisers, and thus not allowing them to "influence" the values. The practical consequences of this law has caused lenders to feel less confident in the appraisal, than ever before.
In practice, this HVCC law has helped create a third party appraisal referral industry. This industry is collecting as much as 40% of the appraisal fee. Because so little remains for the appraiser, many of the experienced appraisal professionals cannot stay in the industry. What remains are inexperienced and green appraisers who do what they can to arrive at a value, and travel as far and wide as possible to stay busy enough to survive. Lenders are now forced to charge borrowers additional fees for appraisal reviews that can undercut values, and kill the loans from moving forward. Many lenders are even requesting second appraisals, at the borrowers expense, to feel confident about the reported values.
In the end, borrowers are stuck paying more for the appraisal, and many lose out on purchasing a home because of the inaccuracy of appraisal work being seen. There has also been a tremendous amount of "poor assigning" done by these third party agencies, where they have assigned appraisers, who are not local to the area, assessing values where they are completely unfamiliar with the geography. These third party agencies have no real competition, and can bank on other peoples work, so what do they care?
I had to face just this type of scenario with a recent client, where an appraiser from 110 miles away was assigned to an appraisal of residential property. His value was off by about $10,000 from where the market was, and after 2 appraisals, and 6 weeks of going back and forth, the proper assessment was accepted. The purchase escrow did close successfully, but the real estate office was upset with me because I could not guarantee the appraisal would come in at value, and felt like it took way too long to close. My response is simple and true, don't blame the mortgage professional, blame Washington.
Joe Almirantearena has not received any gifts yet