Marielle is an Accredited Buyer Representative, is e-Pro Certified and is a Certified Distressed Properties Specialist.
Home Buyer's Tax Credit:
The 2009 First-Time Homebuyer Tax Credit, part of the recent stimulus package. It is available through the end of November. The credit can be as much as $8000, depending on income eligibility limits. To qualify, you cannot have owned a primary residence in the last 3 years. Generally, the credit does not have to be repaid, except if you sell the home within 36 months of the purchase date. See IRS Form 5405 for details.
If you took advantage of the 2008 credit, it still needs to be repaid.
Home Owners who need help:
Beware of firms trying to take advantage and make money off troubled borrowers. They charge substantial fees and tell borrowers they can conduct quick and effective negotiations with banks. In most cases, these firms take the homeowners’ money and do nothing.
If you need help, there are plenty of resources that are free, such as asking a knowledgeable Realtor what your options are, talk to your Lender, go to your city, county or state program, or call a HUD-approved nonprofit counselor ( http://www.hud.gov/). If your mortgage is held by Fannie Mae or Freddie Mac, you can check what help might be available to you at: www.makinghomeaffordable.gov.
Short Sales
A short sale means that the house cannot sell for what the homeowner owes the Bank. It can be done but it is a lengthy, complicated process that requires a lot of patience.
As a prospective Buyer, you need to first and foremost have a mortgage approval. You should be prepared to repeat the process with the Bank that owns the mortgage. You should also be aware that not all short sales see a successful outcome. Because the house has not yet become Bank property, there can be issues with unpaid liens, taxes, equity lines of credit, etc.
As a Seller, you need to be aware that a short sale does not have the same impact on your credit as a foreclosure but you need to be aware that there can be tax consequences. While it is true that the Federal Government passed a law in 2007 directing the IRS not to count mortgage debt forgiven by a Lender as income, the provision applies only to purchase money. It does not apply to debt on a cash-out refi and it does not apply to second homes. Sellers also need to be aware that if they have a 2nd mortgage, the second trust lender will likely not forgive the debt. The probable scenario is that they will accept a partial payment from the sale and sell the balance to a collection agency who will then pursue the former owner for payment of the debt.
Foreclosures
Foreclosed homes are properties that are Bank owned and are being marketed for sale. As a Buyer, you have most likely seen a lot of homes that seem like a great deal. You get what you see. A lot of the foreclosures on the market require work. They are sold "as is". FHA has loans that will help you not only purchase the house but get it back in shape.
