What can I get for 75, 150, 250, 350, 450 and 525 thousand dollars?

Here is a recap of homes I have been showing clients recently.

$75,000 – PICTURE BELOW. This is a 3 bed 2 bath home built in 2004.  It has 1,300 square feet. It is located in Florence, AZ which is South of Queen Creek.  It is a bank-owned foreclosure in good condition with a view fence that backs to a golf course.

$170,000 – PICTURE BELOW. This is a 3 bed 2 bath home built in 2007 that has never been lived in.  The builder went bankrupt and is selling the property AS-IS.  This home has 1,854 square feet and is a 2 bedroom with a 1 bedroom casita (seperate entrance).  It is located in Gilbert, Arizona in Higley Park at Ray & Higley.

$249,000 – This is a 2,194 square feet 4 bed 2.5 bath home built in 2004.  This home is located in the popular Spectrum neighborhood at Pecos & Lindsay in Gilbert, AZ. Picture below.

$450,000 – This is a 5 bed 3 bath home that was newly completed in Oct. 2008.  It is located in Chandler, AZ near Germann & Gilbert Rd.  This home has close to 4,000 square feet with a loft. It has beautiful upgraded cabinetry, flooring, paint, granite countertops, etc and is in a popular subdivision. Picture below.

$525,000 – This is a 3 bed 2.5 bath home built in 1984 (with lots of remodeling).  It is located in Fountain Hills, AZ (East of Scottsdale, North of Mesa).  Very private lot with panoramic mountain views. Picture below.

Let me know if you’d like more information on any of these homes, price points or areas. – Becky Wyatt

Three Big Mortgage Loan Changes effective Jan. 1, 2009

Potential Home Buyers:

BE AWARE that several loan programs will change on January 1, 2009.  The FHA minimum down payment goes up from 3% to 3.5%.  The FHA maximum loan amount goes from $346,250 down to around $318,550 (in Arizona).  Once a buyer has a purchase contract, a mortgage lender can establish an FHA case number which is the date used for cutoffs.  So if the max loan amount and downpayment amounts matter to you – get those contracts written in 2008!

Also, the USDA “Rural” Housing Program will eliminate some of the areas that are currently still eligible for 100% financing.  Right now Buckeye, Maricopa (the city), and parts of Anthem and Queen Creek are all still eligible for 100% financing on this program.

Most of my clients are doing FHA loans with 3% downpayments (which is $7,500 on a $250,000 house).  The closing costs associated with buying a home (another 2-3% of the price) can be paid for by the seller!  Let a Realtor help you negotiate for this!  It costs you as a buyer NOTHING to have me as your Realtor, full-time, looking out for your interests. Call me at 480-383-9209 or email me at Becky@BeckyWyattOnline.com – Becky

The Truth about Short Sales

by Catherine Reagor - Oct. 18, 2008, The Arizona Republic

More than 7,000 homeowners facing foreclosure in the Valley are trying to sell their homes through a process known as a short sale, according to Arizona Regional Multiple Listing Service data.

But less than 5 percent manage to sell before lenders seize their houses.

The failure by banks and homeowners to agree to a short sale – to sell a home for less than the amount still owed on the mortgage – is adding to the Valley’s growing foreclosure problem.

And the government’s recent financial-bailout package to help alleviate the nation’s housing crisis will do little to address the problem of short sales.

When homeowners whose property values have collapsed fall into arrears on a mortgage, short sales allow them to negotiate a deal with their lender to sell their home for less than they owe and avoid foreclosure.

An increase in the number of short sales could slow the Valley’s record foreclosure rate, which has yet to peak.

However, a number of factors are preventing short sales:
• Lenders, overwhelmed by a record number of mortgages in default and their own losses in the financial-market meltdown, are not negotiating with many borrowers seeking a short sale.
• Many homeowners facing foreclosure wait too long before contacting their lenders.

“I don’t see many people having success with short sales, either sellers or buyers,” said Mike Orr, a Valley real-estate agent. “For buyers, the process of getting lender approval is lengthy and tiresome. Sellers often run out of time if they are already behind in their mortgage payments.”

Because there are so many foreclosed-on homes that lenders are trying to resell at bargain prices, he said, there is little incentive for a buyer to go through the “laborious” process of a short sale.

Lenders have foreclosed on almost 30,000 Valley homes this year. Most are sold for tens of thousands of dollars below what was owed on them. And many resell for thousands of dollars less than what was offered through short sales.

Better than foreclosure

The purpose of a short sale is to allow a homeowner to sell a house at its current market value and get off the hook for however much of their mortgage isn’t paid off by the sale.

Homeowners don’t get any cash from a short sale but avoid a foreclosure black mark on their credit. A short sale impacts credit, too, but not as badly.

A short sale is better for a neighborhood because it means a home is being purchased by someone and not foreclosed on by the lender, left vacant for months and then resold for even less.

Also, short sales usually cost lenders less than a foreclosure. Research from the national financial-consulting firm Clayton Holdings Inc. indicates lenders lose only 19 percent of a home’s loan amount on a short sale, compared with 40 percent on a foreclosure.

“Short sales are the best solution out there for the borrower, the bank and the buyer,” said Randy Kutz of HomeSmart’s Phoenix Heritage Real Estate Group. However, he said short sales are “the brain surgery of real estate” and take time and expertise to execute.

First-time Buyer Tax Credit: A Reason to Buy Now

The homeownership tax credit that the federal government created earlier this year is a hard-won tool at your disposal to encourage your customers to jump off the fence and get into the home buying market.   

When you combine the tax credit with today’s continuing low interest rates, large selection of for-sale inventory, and low home prices, many of the pieces are in place for your customers to buy now.

How the Tax Credit Works

The First-time Home Buyer Tax Credit was passed this year as part of the Housing and Economic Recovery Act (H.R. 3221) on July 30 and targets any individual or household that hasn’t owned a home for at least three years. Taxpayers can take the credit on their 2008 tax return if they bought their house this year after April 9. 

It’s worth up to $7,500 and can be taken in a single tax year. Authorization for the credit ends July 1, 2009, so if your customers wait to buy in the first half of 2009 they can take the credit on their 2009 tax return.

The actual credit amount is set as a percentage of the home purchase amount. That percentage amount is 10 percent, so your customers can get 10 percent of the home price credited against their tax liability, up to a maximum $7,500. 

Income limits are $75,000 for individuals and $150,000 for households. Individuals whose income exceeds the $75,000 limit but isn’t more than $95,000 can still take the credit but on a reduced basis. The same thing applies to households earning up to $170,000.  Any house is eligible as long as it’s a primary residence and is in the United States. 

Buyers Have 15 Years to Pay Back

To help keep the program cost effective for taxpayers, the federal government requires the tax credit to be paid back in small, 6.67-percent increments over 15 years. For that reason, some analysts have likened the credit to a 15-year, interest-free loan to help make home buying affordable. 

There’s one restriction on the type of financing that your customers can use if they plan to take the credit. That restriction is on tax-exempt mortgage financing. That only applies if your clients are using below-market interest-rate financing from a public agency or nonprofit that’s funding the loan using proceeds from a tax-exempt mortgage-revenue bond issue. For most buyers, this won’t be an issue. It’s mainly an issue for low-income buyers using special mortgage financing.

How the New First-Time Buyer Tax Credit Works

Under the new housing bill, home buyers who have not owned a home in the last three years will be eligible for a tax credit equal to 10 percent of the property up to a maximum of $7,500.

Here’s how it works:

• The credit is $3,750 for married couples filing separately. Unmarried people who jointly purchase a home will be able to divide the $7,500 credit.

• This program is actually a loan, which home buyers must repay over 15 years at zero percent interest beginning in the second year after they purchase the home. A home buyer who qualified for the whole credit would pay $500 for 15 years or about $41.67 per month.

• The credit applies only to homes purchased on or after April 9, 2008, and before July 1, 2009.

• High-income home buyers don’t qualify: Eligibility begins phasing out for single filers with adjusted income of more than $75,000 and $150,000 for joint filers. It completely phases out at $95,000 for singles and $170,000 for married couples filing jointly.

Source: The Washington Post, Michelle Singletary (07.03.08)

New Housing Bill Signed into Law

The Housing and Economic Recovery Act
Last week, President Bush signed the “Housing and Economic Recovery Act of 2008″ into law. This $300 Billion rescue plan is aimed at helping struggling homeowners avoid foreclosure, as well as boost confidence in the housing market. Although the bill is several hundred pages long and contains a number of far-reaching provisions, here are a few of the major provisions in the legislation that impact homeowners and homebuyers:

1. Tax credits. First-time homebuyers who purchase their primary residence on or after April 9, 2008 and before July 1, 2009 are eligible for up to $7,500 in tax credit, provided they haven’t owned a home in the last three years and fit certain income parameters. The credit is generous, but it is actually an interest free loan, paid back over 15 years at $500 per year when taxes are filed.
Special note: Some types of seller-paid down payment assistance programs are being eliminated as of October 1st as well – so purchasing a home before then may gain you a double benefit of tax credits AND seller-paid down payment assistance while it is still available.
2. Larger loans at lower rates. There have recently been provisions in place that have allowed loans larger than $417,000 to qualify for better financing rates than normally would be available for “jumbo” loan amounts of that size, thanks to Fannie Mae and Freddie Mac.

No More Downpayment Help from Sellers

The new housing rescue  bill President Bush is expected to sign this week will really change things for buyers needing help with their down-payment.  Currently, there are FHA loan programs out there that allow the seller to contribute to the buyers down-payment (providing instant equity for buyers, and less out of pocket costs for buyers).  That ends October 1st, 2008.  All loans approved after that date CANNOT have the seller pay for the down-payment that is required for an FHA loan (currently 3% of a sales price).  This bill will also adjust the minimum FHA down-payment requirement from 3% to 3.5% which means you’ll need to have more money saved up if you are interested in buying a home.  There are many other details to this bill but these two features will effect many potential homebuyers.  Personally, three of my recent clients have used programs such as Ameridream, Genesis, Nehemiah that allow for the seller to pay the buyers down-payment. If you are considering buying property, and were interested in some type of zero down loan program where the seller would help with your down-payment then you must hurry and get pre-qualified for a mortgage loan NOW and start shopping for property.  Please feel welcome to post comments or questions. – Becky Wyatt

Roof Care 101

Here is a special article written just for us from Josh Caruso of M&J Roofing.  They recently helped a client of mine in Scottsdale with a flat roof and I was so impressed with his roofing wisdom, I asked him to contribute to ArizonaHomeTalk.com.  He’s happy to help with any and all roofing dilemmas.  Take it away Josh…

Taking care of your roof is very important, especially in Arizona where we have such extreme weather conditions.  There are many things you can do, as a homeowner, to protect your roof. 

            Before monsoon season, it is very important to check many parts of your roof to keep from having any leaks that could turn into major problems down the road.  Here is a list of the most important.  It is a good idea to have a professional come inspect your roof and let you know of any areas that need assistance. 

·        Gutters Are Clear of Any Debris.  This is important to not have back-up of water and cause a leak due to ponding water.  It will also cause wood-rot if wood is in the area.

·        All Flashings Are Sealed.  Flashings are the metal that seals off water when there has been a roof installation.  Such installations can be chimneys, vent pipes, AC units, sky lights, etc. When flashings are sealed correctly, there is less of a chance for water to get into the roof membrane and cause a leak.

·        Flat Roofs and Patio Roofs Need to be Recoated Every 3-5 Years.  When a new coating is on the roof, it has the reflective coating that protects against leaks and the breakdown of the roof.  The coating also reflects UV rays that causes breakdown of the roof over time.  In Arizona, the sun, animals (especially birds) and the weather breaks the roof membrane down.  Re-Coating the roof will add many years to the life of the roof so you won’t need to have a complete re-roof.

·        Replace Broken Tiles.  When tiles are broken and/or missing, it causes the water-proof tar paper to be exposed to the sun.  The sun will shine directly on the tar paper causing it to deteriorate quickly and create leaks.  Having broken or missing tiles will take many years off the life of your roof.

If you keep the maintenance on your roof up-to-date, it will increase the life of your roof by many years.  If you have any questions, please feel free to call M&J Roofing.  We will be happy to answer any questions and we give FREE ESTIMATES.

Josh Caruso, M&J Roofing

PHONE (480) 200-7156 ~ FAX (480) 459-5781

EMAIL:  JOSH.MJROOFING@COX.NET    ROC# 222308

 

Lowball Offers…Part 4/4

Remember that time is critical to the highly motivated seller.

Whether or not sellers accept your lowball offer often depends on how much pressure they’re under to sell, Davis says. Obviously, those in a rush are usually more willing to entertain a lowball bid, even if it means making a counteroffer to bring up the dollar amount.

The retired teacher was a case in point. At 66, she lacked the energy to keep up her elaborate landscaping. So when a condo-apartment came up for sale in a retirement community where several friends lived, she immediately snapped it up. By the time the young couple came along, however, her house had languished unsold for months and she was in a financial pinch.

“Of course, she didn’t get as much money as she’d hoped for her property. But she was delighted at the chance to sell to nice people and move on with her life. So in the end, this was a win-win deal for everyone concerned,” Davis says.

By: Ellen James Martin, UNIVERSAL PRESS SYNDICATE

Lowball Offers…Part 3/4

Make sure your bid has a pre-approval letter attached.

Because sellers currently outnumber buyers in many neighborhoods, some purchasers see no point in bothering to obtain pre-approval for mortgage financing. But bargain-minded buyers know better, says Tom Early, a real estate broker and former president of the National Association of Exclusive Buyer Agents (www.naeba.org).

“In today’s market, you absolutely want pre-approval to remove all doubts in the seller’s mind that you’re qualified. Many homeowners think buyers can’t get loans now, and you have to prove them wrong to negotiate from strength,” Early says.

Granted, those with blotched credit or checkered employment situations now face a big challenge when seeking to secure home financing. But if you have a steady job, reasonably good credit and a minimum of debt, your odds of obtaining a mortgage pre-approval letter from a reputable lender are still very good, Early says.

By: Ellen James Martin, UNIVERSAL PRESS SYNDICATE 

P.S. From Becky…A Loan Status Report (LSR) is required to submit an offer in Arizona.  This acts as a pre-approval letter stating that you’ve had a conversation with a Mortgage Lender and have started the process for getting a loan.  I advise my  buying-clients to have an LSR ready before we go look at homes, in case you want to make an offer.  I also advise my seller-clients to request an LSR accompany ALL offers, no exceptions, to ensure we deal only with well-qualified, serious buyers.