We now have a group called Platinum Services that will assist homeowners with the short sale of their property. A short sale exists when the homeowner owes more on the mortgage or mortgages than the home can be sold for in the current market.

Many people don’t realize that the Home Equity Line of Credit is actually a second mortgage and must be paid off at the time of sale as well as the first mortgage. The process for negotiating with the lender, often two lenders, and submitting all the required documentation is daunting for most people. Days of frustration can accumulate. The Platinum Group will assist me, as your Realtor, in gathering all the required documentation and negotiating with the lender(s). There is no charge to you, the seller, for this service. Too often, a seller will have a buyer for their property, but the buyers become disenchanted when the short sale process takes too long and he or she will terminate the contract. This service can help to alleviate this problem. Don’t lose your potential buyer. Contact me if you would like more information.

I am hosting a free seminar on September 24, 2009 from 6:30 – 8:00 p.m. at the Charles Chrin Community Center in Palmer Township, PA.

The seminar is to help people learn how to take care of their homes as owners, explore selling or re-financing options, and what is involved in a property inspection. The seminar will also teach buyers what goes into financing and inspections. Buying or selling a home needs to be part of your overall financial plan. Don’t fall into the urgency trap. Gather information and educate yourself first! We will help you.

I will also be discussing why it is a good idea to have a Realtor represent you in today’s marketplace.

Guest speakers will include Dan Thierry from Dominion Mortgage and Bob Blanchfield from Building Inspection Services. Light refreshments will be served. Please RSVP at peg.gerns@LnF.com or 610-657-3657

I have had many friends and clients ask me this question. Essentially, buying a home can be complicated, frustrating, fun, exhilarating and satisfying. Most people don’t know all the elements that go into the process. You find a house you like, you make an offer, go to the bank for the loan and get the house. I wish it were that simple!

With changes in lending laws, it is imperative that buyers and sellers know their finances. I am always surprised when a client tells me that they don’t have any idea what they can afford or really how much they owe various institutions. If you know your debt and your yearly income and discuss these thoroughly with your lender before you look at homes, you are much less likely to be disappointed.

Looking at homes and finding the one you love is the fun part. It can be time consuming, but well worth it. Once you have found the home you want, and having reviewed your finances already, the process will go much more smoothly. Then the offer is written and hopefully accepted. Your Realtor begins to coordinate all the contingencies in the contract. Your Realtor must know the contract well and explain it thoroughly to you, including your obligations, before you sign it.

There are often more than 20 people involved on a buyer’s behalf in a real estate transaction. Your Realtor is the person who can communicate best to you. Work with him or her closely, communicate openly, ask questions. The more informed you are, the more successful you will be in purchasing your home.

Confused about how to access the $8,000 tax credit? You’re not alone.  I spoke with three lenders last week and received 3 differing explanations.  The Tax Credit was meant as an incentive to help first-time homebuyers move more quickly to make their home purchase.  The problem has been that it is a tax credit, not assistance with down payment or closing costs. It wasn’t enough to help many homebuyers. So, HUD announced that the Tax Credit could now be used as money for a down payment with an FHA loan. Then the IRS had problems with the idea, so HUD retracted.  Apparently, HUD and the IRS have worked out their differences. (A friend of mine had commented that it would be nice if 2 government agencies could collaborate during this economic crisis). As I understand it, a first-time homebuyer may now use the $8,000 tax credit towards either down payment or closing costs.  The program still expires November 30, 2009. Please check with your lender for a detailed explanation!

A short sale happens when the seller has to sell the home for less than is owed the lender or lenders. The housing market has declined and the market won’t bear the price of the home with all of one or both mortgages being paid off.

Many homeowners are finding themselves in this situation whether they purchased a home with 100% financing, when that was still possible, or they took out a home equity line of credit (HELOC).

The seller needs to contact the lender or lenders right away to discuss the short sale process. The lender will have a loss mitigation department and a short sale packet. It is difficult to speak to the same person twice when calling, so get as much information as possible.

If you contact a Realtor to do a listing presentation, make sure that the Realtor has experience with short sales. Not that the Realtor negotiates with your lenders, but that the Realtor understands what the limitations are. A Realtor should be able to recommend a marketing and pricing strategy, and make recommendations for staging and presenting your home. The Realtor’s job is to find a ready, willing and able buyer. Too many Realtors think they can handle everything.

There are a number of Realtors who have taken courses and classes on short sales and foreclosures. This is great and a big help, but when it comes to giving legal advice or advice regarding the tax ramifications of a short sale, a seller should rely on the expertise of an attorney and an accountant, respectively. An attorney will most likely be much more effective in negotiating with the lender and is more likely to get faster responses. There are potential tax ramifications for a short sale and it is important to consult an accountant who is up to date with these.

There are far too many situations where sellers have opted not to get an attorney or speak with an accountant and they have found that costly mistakes were made that could have been avoided.

A short sale is an emotional and difficult situation for a homeowner. A team of professionals should be in place to help.

If you have wanted to live in the country for a quieter lifestyle, U.S. D. A. offers a great loan program for people buying rural properties. The property must qualify for the program, as well as the borrower. Only certain lenders are able to offer this program and can tell you what properties qualify. New income limits will be effective April 20, 2009. The limits are $80,500 for a family of 1 – 4 people in Northampton, Carbon or Lehigh County, PA and $106,250 for a family of 5 or more.
For those of you who have either lived in or visited these counties, you know that the landscape is beautiful. There are some great homes available for sale. This program makes rural housing affordable for many people.
Thanks to Dan Thierry, Dominion Mortgage, Nazareth, PA for the information.

Is it better to rent or to buy right now? That’s a question I
am asked several times a week. There’s no doubt that there
are great opportunities in the current housing market to buy
a home. And the $8,000 first-time homebuyer credit makes
those opportunities even better.

The right time and conditions have to be present for anyone to
make as large a financial investment as buying a home. If your
economic, geographic, or family considerations don’t line up
for you to buy a home right now, that’s ok. Renting is just fine
if you aren’t ready to buy. Realtors, family members, friends
may tell you that you are wasting your money on rent. It is
true that you are not investing in equity. But it is better to
wait to buy a home when everything is in order than to buy
prematurely. Prudent planning is much wiser!

I enjoy giving back to my community in whatever way I can.
Recently, I was Team Captain for a Bowl-A-Thon with Big
Brothers/Big Sisters of Lehigh Valley. This is a great event
that brought a lot of people and businesses together for a
good cause. Over $121,000 was raised in one day! And it
felt great to be part of it!

There’s a lot of confusion out there about the first-time
homebuyer tax credit. Basically, last year a first-time
homebuyer was eligible for a $7,500 tax credit to be paid back
as a no interest loan over 15 years beginning in 2010.

The first-time homebuyer tax credit for 2009 is $8,000 and
does not have to be paid back. Any home that is purchased
for $80,000 or more qualifies. If the home costs less than
$80,000, then the tax credit will be 10% of the cost. This tax
credit is available for the purchase of a primary residence on
or after January 1, 2009 and before December 1, 2009.

With more homes available at reasonable prices, this is a
good opportunity for a first-time homebuyer.

In addition, any homes purchased in 2008 with mortgage
revenue bonds are not eligible for the $7,500 tax credit. But
homes purchased using mortgage revenue bonds in 2009 are
eligible for the $8,000 tax credit.