How Parents Can Help Adult Children Buy A Home
April 29, 2009
How parents can help their adult children to buy a home and get $8000 in return.
If you are a parent with children of the age of 18 years or older you are eligible to help them buy their first home with you as a cosigner by using FHA financing. With FHA financing the down payment amount is only 3.5%. So instead of renting they can now have an option to buy with your help.For example if you buy a $100,000 home or condo your down payment would be $3,500. Once you have closed the home you are now eligible for the $8000 tax credit. Instead of waiting until next year to file your taxes your child can amend their taxes and get the $8,000 check from the government this year.Now as long as your child does not sell their home for the next 3 years then they do not have to pay back the $8,000 tax credit. This holds true whether you have one or more children. In my 20 years of helping first time home buyers buy a home I have never seen such a great way to help them get into a home for virtually no money of their own. It is like our government is paying us to help our kids buy their first home.
Check with your tax consultant for details.
Hot Markets For House Hunters
April 28, 2009
Cities in the “sand states” of Arizona, Florida, California and Nevada dominate a list of most-searched communities by ZipRealty users during the first three months of the year.
In its quarterly “Home Hunters Report,” ZipRealty tracks data from 5,400 cities in 33 of the 35 markets the company operates in to identify the most-searched cities.
Phoenix topped ZipRealty’s list of the 25 most-searched cities, and seven other cities in Arizona made the top 25 (Scottsdale, Mesa, Chandler, Gilbert, Tempe and Queen Creek).
Florida had six cities on the list (Naples, Orlando, Fort Lauderdale, Kissimmee, Fort Myers and Cape Coral), while California had five (Chula Vista, Carlsbad, Huntington Beach, Oceanside and La Jolla).
Three cities in Nevada made the top 25: Las Vegas-Summerlin, Henderson-Green Valley, and Henderson-Anthem/Seven Hills.
The only cities not in the sand states making the top 25 list that were were Atlanta, Ga. (14th), and Houston, Texas (20th).
Most of the cities on ZipRealty’s top 25 list were also on a list of 26 metro areas with the highest foreclosure rates during the first quarter compiled by data aggregator RealtyTrac (see story), suggesting consumers are bargain hunting.
ZipRealty also tracks “hot” and “cold” ZIP codes by looking at how offers submitted by buyers and accepted by sellers compare to the original list prices of homes. ZIP codes in which a large percentage of offers come in higher than the list price are defined as “hot,” while those in which offers tend to come in at less than list price are labeled “cold.”
During the first quarter, the “hottest” ZIP codes in ZipRealty’s markets were Hesperia, Calif. (92344); Daly City, Calif. (94015); Purcellville, Va. (20132); Chicago — Near South Side (60616); Rosemead, Calif. (91770); Dallas, Texas (75211); Vallejo, Calif. (94591); San Leandro, Calif. (94578); Denver, Colo. (80229); and Moreno Valley, Calif. (92555).
ZIP codes identified as the “coldest” by ZipRealty were Palm Beach, Fla. (33480); Naples, Fla. (34102); Miami, Fla. (33142); Delray Beach, Fla. (33483); Miami Beach, Fla. (33139); North Palm Beach, Fla. (33408); Harvey, Ill. (60426); Granbury, Texas (76048); Dinuba, Calif. (93618); and Fort Lauderdale, Fla. (33304).
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8 Things To Due Before Refinancing
April 23, 2009
With 30-year interest rates well below 5 percent, and 15-year interest rates between 4 percent and 4.5 percent, it’s time to start seriously thinking about refinancing your mortgage.
But before you high-tail it to the nearest mortgage lender and fill out a mortgage application, there are eight things you should do:
1. Check out the interest rate you have on your current loan. When interest rates dip, the natural inclination is to start filling out loan applications left and right. But too many times, homeowners are focused solely on the new interest rate instead of how much they’ll save by refinancing. While you may get water cooler-bragging rights, you should refinance only if it’s going to save you money.
2. Find out how much your home is really worth. There’s no way to sugarcoat it: Home values have sunk around the country an average of about 20 percent in the past year. In some places, such as Las Vegas, Miami, Phoenix and the San Francisco Bay Area, the decline has been twice as steep. It’s vital to assess whether your home still has any equity (the difference between what you owe and what the home is worth) or if you are “underwater” with your mortgage (meaning that you owe more to your lender than the property is worth. Whether you have equity will determine what kind of refinance is open to you.
3. If you’re underwater with your mortgage, assess how far underwater you are. While federal requirements have changed with regard to refinancing loans owned or serviced by Fannie Mae, Freddie Mac or FHA, if your loan is more than 105 percent of the value of the property, you may not be able to refinance without bringing cash to the table. (You may still be eligible for a loan modification, however.)
4. Get a copy of your credit history and credit score. Since the credit crisis began, lenders have raised the credit scores required to get approved for the best loan programs and best interest rates. The best place to go for a copy of your credit history and credit score is AnnualCreditReport.com. It’s the only place where the three credit reporting bureaus provide a free copy of your credit history each year, plus you can pay $7.95 for a copy of your credit score. Choose the Equifax credit score, since it’s the one closest to the score used by most lenders. (You can also go to MyFico.com, and purchase your credit history and FICO score for $15.95. You may also find their online community to be helpful in terms of suggestions on how to raise your credit score.)
5. Start identifying potential lenders. Shopping around for a loan takes a little more planning and effort than it used to, as lenders have jacked up the fees they charge to underwrite and process the loan. Your best bet is to talk to a national lender, a credit union (if you belong to one or can join one), a local mortgage broker (call your real estate agent if you don’t know one and ask for several recommendations), and perhaps an online lender.
6. Find out if your second lender will subordinate to your first lender. If you have a first and a second mortgage (also known as a home equity loan), find out whether the second lender will subordinate to the new first lender. That will allow you to refinance your first mortgage, while leaving your second loan in place. Many second lenders will not agree to this, and if yours doesn’t, you may not be able to refinance at all unless you pay off the second loan. One possibility is to refinance your first mortgage with the lender who owns your second loan.
7. Focus on the big picture, not just the interest rate. While the interest rate you’d get is important, it’s also important to calculate how much you’d pay in fees, and how long it will take to pay yourself back the cost of the refinance with your monthly savings. For example, if you’re going to save only $50 per month, and it costs you $5,000 to refinance, it’ll take you 100 months — or more than eight years — to pay back the cost of doing the loan. You won’t start saving until well into the eighth year of paying down the mortgage. So, unless you’re cutting the term of the mortgage significantly (going from a 30-year to a 15-year), or you’re able to pay off the costs in a relatively short period of time (say, less than a year or 18 months), it may not pay to refinance.
8. Get your paperwork together ahead of time. Before the housing crisis, you could almost do a refinance over the phone. In fact, you could call the loan officer you worked with regularly and put in your order for a refinance. You could do a no-cost refinance without providing much in the way of proof of earnings, or account statements or copies of tax returns. The forms would be delivered to your home, and then you’d sign them and send them in. Today, you’ve got to have your paperwork in order before you can refinance. Gather your W-2, a current paycheck, copies of your last two federal and state tax returns, copies of your bank accounts, retirement accounts, and other assets. Then call the lender.
Ilyce Glink
Inman News
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Demand For Mortgages Picks Up
April 22, 2009
Refi gains outweigh slump in purchase applications
By Inman News, Wednesday, April 22, 2009.
Refinance applications were up 7.7 percent from the previous week, while applications for purchase loans fell a seasonally adjusted 4.2 percent, the MBA said in releasing the results of its Weekly Mortgage Application Survey.
Applications for conventional purchase loans were down 4.6 percent, while applications for government-backed loans, largely FHA, fell 3.6 percent.
Applications for refinancings accounted for 79.7 percent of total demand, up from 77.8 percent the previous week and 49.2 percent a year ago.
Looking back a year, applications for both purchase and refinance loans were up 84 percent. Applications for refinance loans were up 186 percent from a year ago, while applications for purchase loans were down 29 percent.
The average contract interest rate for 30-year fixed-rate mortgages last week increased to 4.73 percent from 4.7 percent, with points decreasing to 1.12 from 1.23 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. That compares with 6.04 percent and 1.04 points a year ago.
The average contract interest rate for 15-year fixed-rate mortgages remained unchanged at 4.46 percent, with points increasing to 1.18 from 1.04 (including the origination fee) for 80 percent LTV loans. That compares with 5.6 percent and 1.06 points a year ago.
The average contract interest rate for one-year ARMs decreased to 6.19 percent from 6.21 percent, with points decreasing to 0.14 from 0.15 (including the origination fee) for 80 percent LTV loans. That compares with 6.93 percent with 1.38 points a year ago.
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The Great Easter Rock Hunt. $1,000 In Cash and Prizes
April 3, 2009
More than $1,000 in Cash and Prizes at The Great Easter Rock Hunt
The Rock is putting a spin on the traditional Easter Egg Hunt with a prize-driven Rock Hunt, Saturday April 11 at the multi-use center on Brockway Rd. More than $1,000 in cash and prizes will be given at The Rock event, which follows the Truckee Donner Recreation and Parks District Easter Egg Hunt.
Just some of the prizes include a $200 cash prize, numerous gift certificates for dinners for four at The Rock dining establishments including Drunken Monkey, FiftyFifty Brewing Co., Peluso’s Apizza and Thai Delicacy as well as coupons for free slices of pizza, free appetizers and more. Tahoe Forest Church will also have several large bounce houses on hand for kids to enjoy at no cost. Families can’t afford not to come out for this fun, free event!
This event is sponsored by The Rock multi-use center, which is easily accessed off Highway 267 directly adjacent to the Ponderosa Golf Course next to the roundabout and across from Sierra Meadows at 11197 Brockway Road. For more event information, call 530.550.2252. For The Rock leasing information, contact Katie Morrison of North Tahoe Commercial at 530.582.4623.
