Congress — both the U.S. House and Senate — passed the Homebuyer Assistance and Improvement Act of 2010 (HR 5623), which extends the Closing Deadline for Homebuyer-Tax-Credit eligible transactions to September 30, 2010 (instead of June 30).
This extension of the Closing Deadline applies only to transactions with ratified contracts in place as of April 30, 2010 but not yet closed.
Up to 180,000 homebuyers nationwide (including approx. 8,500 in Ohio) would have lost their tax credit had Congress not passed this extension.
What happened
The Senate approved the legislation – by unanimous consent – last night at 9:40 pm.
The House approved the legislation on Tuesday, June 29 by a vote of 409-5.
The legislation provides a seamless transition. There is no “gap” between June 30 and the time when the bill will be signed into law by President Obama (likely to occur today).
Government Affairs staff from the National Association of REALTORSâ worked vigorously with Congressional leaders on both sides of the political spectrum to get this legislation enacted.
This month I contributed a feature to the online magazine David’s voice. I had the opportunity to share my thoughts on purchasing forclosures and short sales with their audience. I am allways very clear with my clients when they ask to see short sales and foreclosures because they are unlike consumer owned sales in a few specific ways.
They key difference is that in short sales and foreclosures the bank that owns the mortgage plays a muh larger role in finalizing the sale price and contract terms. In both situations the bank must approve the sale price, terms of the contract, and ultimately has the final say on the contact to purchase. I am pasting the article below:
If you have been paying attention to the real estate market, you are probably aware that there are a number of homes on the market that are in foreclosure or in short sale situation. But, as a home buyer, what does it mean to buy a foreclosure or a short sale, and how is it different than buying a consumer owned property? Which is right for you? Each situation presents its own set of challenges and I think it is valuable to outline the differences here.
In a short sale situation, the seller owes more money to the bank than they can sell their home for and have incurred a hardship where the bank has agreed to accept less money than the seller owes them, in an attempt to avoid a foreclosure. The advantage to this situation is that the seller avoids having a foreclosure on their credit which destroys ones credit for 7 years.
Instead this short sale option tarnishes a seller’s credit for approximately 3 years. Short sales are often listed for less than market value, so they can be a good investment opportunity. But it is important to note that the lending bank will always have the final approval authority on sale, so buyers making offers on short sales must make a strong offer without concessions if they want the offer to be accepted and approved. When purchasing a short sale I caution buyers that they need to be patient and understand that their offer needs to not only meet the approval of the home seller, but also the bank.
In addition they need to understand that short sales can take much longer to close than a consumer sale (though it may seem backwards that short sale=long wait). Because of the number of asset managers and approvals required, short sales can take multiple weeks or even months longer than a consumer owned sale depending on the status of the deed transfer in the county. Hamilton County can take as long as 16-20 weeks to record the deed in a short sale situation.
In a foreclosure, the bank repossesses the property and assumes ownership. Foreclosure properties are often priced well below market value because the bank’s primary interest is in recouping as much of its investment as possible as quickly as possible. Therefore foreclosures can provide a unique investment opportunity to buyers looking to purchase property below market value.
The challenge with a foreclosure is that there is no one actively maintaining the property. In my professional experience, I have seen foreclosed properties in good condition, but more often I have seen foreclosed properties in extreme disrepair. In some cases foreclosures require substantial investment to repair the neglect and make the home livable. Depending on the home, the investment in repairs combined with the purchase price may make the total cost of a foreclosure more than the cost of a consumer owned home. Financing options are limited as well if you are not a cash buyer depending the home’s condition.
No matter how good a deal a foreclosure or a short sale seems there are always other things to consider aside from the price: the time it will take to close a deal, the complexity of working with a bank, and the additional costs in repairs to bring it to the neighborhood standard. Both situations present unique opportunities and challenges, but it is most important to make sure you are well aware of all these factors before agreeing to anything.
If you have any additional questions please feel free to call me and ask questions. I would be happy to provide you resources and information that will make your home buying experience exceptional.
Every home buyer I work with has different criteria that defines what is ideal for them. I often hear phrases like ‘good school district’, ‘low taxes’, and ‘nice neighbors’.As a Cincinnati real estate agent licensed in Ohio, there are certain rules that govern how we present information to clients.
The challenge is defining what ‘good’ is. Families may define good in terms of test scores, athletics, number of extra curricular activities, or even college acceptance rate. As a Realtor the best service I can provide my clients is to point them to district information and let them decide what works best for them. I encourage my clients to consider the cost of private school and property taxes when they are considering areas to live. In some cases the comparative costs make a difference of where my clients choose to live.
I have compiled a relatively complete list of links to the various grade schools throughout Cincinnati. The list includes Public, Private, and Religious institutions. I have them listed on my Cincinnati Area School Information page in the Real Estate Resources section of this website.
When so many people have access to the home keys over the course of the numerous transaction it is important for the new home owner’s security. Moreover, some institutions have been known to key all of their properties the same to simplify their property manager’s job. One key – many homes.
So if you are planning on buying a bank owned or foreclosed house use some of the money you save buy new locks. We have done business in Cincinnati with Larry’s Lock and Acme Lock.
A recent article in the St. Pete Times discusses the apparent fraudulent appraisals that very well may have contributed to a number of mortgage fraud cases in the Tampa Bay area. Appraisers are a critical part of the home buying process because they help the lender determine the value of the purchase property. Appraisers evaluate the home value compared to comparable homes in the immediate area so that a lender does not lend more money than the home’s collateral is worth.
Most often the lender is the The article details how some homes were appraised fraudulently way above their actual value. When you work with a Real Estate Agent they should be able to show you a number of resources including comparable area sales so that you know that the price you are paying is inline with what the neighborhood commands.
In the real estate transaction process it is commonplace to see a home buyer inspecting a home. It makes sense to see the issues that will need repair up front for piece of mind and bargaining. However it is not uncommon for agents to be recommending, or even paying for pre-listing inspections. If you are working with a top Cincinnati Real Estate Agent they should be encouraging you to have a pre-listing inspection to give the seller the opportunity to fix problems before a seller finds them and asks to discount the selling price.
The American Society of Home Inspectors has a good national website with important information on it. In fact ASHI has a virtual home inspection on its website that you can do with your perspective clients for education purposes. We will have links to local Cincinnati Home Inspectors in our links section that is coming soon so please check back soon.
As we look back at what was the last half of 2007, from a real estate perspective, on a national level things were not all that good. The sale of new construction and existing homes was down, due in large part to the sup-prime mortgage mess. Part of the current real estate cycle is a return to balance and 2008 is the year for exactly that. This Washington Post article (registration required) gives a nice retrospective on what was 2007 and provides a positive outlook for 2008. The latest quarterly home-price data from the Office of Federal Housing Enterprise Oversight found that while significant declines have occurred in dozens of speculative markets in the past year, prices were flat or up in 204 of the 287 metropolitan markets surveyed.
Real estate in Cincinnati is one of those markets listed where appreciation has held very slow and steady for years. The beginning of 2008 is going to be a great time for new homeowners to come in and purchase first homes while interest rates are still reasonable. There is a tightening of credit, but those who qualify will enter a buyers market and become homeowners for nearly the price of rent. Purchasing a a larger house in a buyers market is always a good idea. You may not get top price for your current home but you will not pay top price for your future home either. The key is to have a real estate agent who understands the economics of the market and can help you make wise long term investments.
A recent product launch proves to be a possible boon for the Real Estate marketing industry. GotZapp is a mobile social network that allows users to send photos, data, sounds, and more to mobile phones as a single download. Some of the developers have pointed to the fact that it could be an exceptional medium for quickly sending home information to potential home buyers. The great thing about the company is here in Cincinnati, Ohio.
Part of what impacts home prices are the outside forces such as interest rates, supply, demand, schools, and other business and neighborhood factors. Personal perception is a major factor in the market value of a home or neighborhood, and it is valuable information for any buy looking to get a fair deal, and any seller looking to market their property at a reasonable price.
So here is Home Predict, website that is allowing people from all over predict the value of homes and neighborhoods. What is important is that market value is a function of the Wisdom of Crowds. If 90 of 100 people think that a neighborhood’s average home is worth $200,000 it is good bet that as a buyer you should be looking to pay about that much, and as a seller it would be wise to list it as such.
In the market boom what we saw collectively was a skewing of the perception of value. We all thought homes were worth more, and therefore the price tags went up. Now as the market cools, and the economy slows we collectively are correcting our perception. Potential buyer’s value perception are the most important information to have, but a community wide poll would probably return similar results. I’d like to see a group of us getting on and helping to set the value of our homes and real estate here in Cincinnati.
In the last few months we all have heard a lot of information about interest rates, and that they are moving up and down. The rates have been in flux and Dan Green, a local Cincinnati Mortgage Broker who writes The Mortgage Report blog, gives a great interview explaining why mortgage rates change and what it all means beyond our own house payments. This is great background information for anyone looking to buy a home.
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