Selling Your Home in a Slumping Market

Read the whole story here: http://realtytimes.com/rtapages/20070824_slumpmarket.htm

If you find yourself having to sell into a slow market, here are some tips to help you make your home more attractive and sweeten the deal to generate more interest in your home:

· Price it to the market, don't be greedy.
· Obtain an appraisal in advance
· Use a seasoned Realtor
· Have your home professionally inspected
· Have your home professionally staged
· Be willing to pay closing costs for the purchaser, up to 6 percent
· Give your Realtor copies of all improvements to the home
· Make sure your Realtor is marketing your home on at least eight Internet sites
· Keep your home in ready-to-show condition at all times
· Focus on curb appeal and making a good first impression

Read the rest of the story:
http://realtytimes.com/rtapages/20070824_slumpmarket.htm

If you've been WAITING to purchase or refinance your home... DON'T!!! You may not get a mortgage if you WAIT:

http://usatoday.com/money/economy/housing/2007-08-05-mortgage-lenders_N.htm?imw=Y

While poor repayment of "subprime" loans to borrowers with blemished credit is the primary concern, there are a few signs that more blue-chip borrowers are also having problems paying their mortgages.

Lenders are quickly closing the door to borrowers with low credit scores, small down payments for a new home or little equity in their current homes.

Homeowners and buyers in high-cost areas such as California, Florida and the Northeast are also reeling as lenders chop "jumbo loan" programs.

TAX RATE CUTS Q&A
On June 14, 2007 the State Legislature meeting in special session in Tallahassee, passed legislation proposing two fundamental changes to Florida's property tax system.

The first change, which is statutory, was signed into law by Governor Charlie Crist on Thursday June 21, 2007. It will require the county, most city governments and several other taxing authorities to roll their property tax revenues back to 2006 levels, with varying additional cuts. The additional cuts will range from three to nine percent depending on previous year's spending.
The school district is exempt from these cuts.

The second proposal, for a Super Exemption, will require a constitutional amendment. Florida voters will make that decision in a January 29, 2008 referendum. If approved by 60% or more of the voters, current recipients of the $25,000 Homestead Exemption and 3% assessment limitation will have the one time option to choose whether to receive the Super Exemption or continue with existing exemption and 3% assessment limitation.
Another component of the January 29 referendum will be a decision whether or not to grant a $25,000 exemption to businesses. If passed, the exemption would apply to Tangible Personal Property such as computers and office furniture.


OWNERS OF HOMESTEADED PROPERTIES

QUESTION: Will the tax cuts be applied to my next tax bill?
ANSWER: Yes. The reduction will be reflected in the 2007 property tax bill which will be mailed to you in November 2007.

QUESTION: How do I know how much lower my 2007 taxes will be?
ANSWER: Every August, a Notice of Proposed Property Taxes is mailed to all property owners. The 2007 Notice of Proposed Property Taxes will outline the estimated 2007 taxes for the property with the tax rate cuts mandated by the state legislature. The notice will also include important information such as property values, exemptions applied to the property, public hearing dates and last year's taxes.

QUESTION: Will I get a refund?
ANSWER: The tax reform legislation will not result in refunds but will reduce future taxes.

QUESTION: Do the tax rate cuts apply to all agencies collecting taxes on my property?
ANSWER: The new reduced rates apply to county and city taxes and to State taxing authorities such as South Florida Water Management District. They do not apply to the School Board portion of your property taxes, which can account for up to 40 percent of your tax bill.

QUESTION: What am I being asked to vote on next January?
ANSWER: On January 29, 2008, voters will be asked to decide if they want to change the Florida constitution to allow for a new super exemption which, over time, would replace the current $25,000 homestead exemption and the accompanying Save Our Homes 3% assessment limitation. New homeowners would fall under the new super exemption.

QUESTION: How much is the new super exemption?
ANSWER: If voters pass the super exemption on January 29, it will work in the following way:The first $200, 000 of the value of a home will be 75% exempt. The next $300, 000 will be 15% exempt. The example below compares a first year 25,000 Homestead Exemption to the proposed Super Exemption:
A home valued at $350,000 will result in the following calculations:

$25,000 HOMESTEAD EXEMPTION
SUPER EXEMPTION

MARKET

350,000

350,000


ASSESSED

350,000

350,000


STANDARD EXEMPTION

25,000

NA


SUPER EXEMPTION

NA

200,000 X .75 = 150,000
150,000 X .15 = 22,500
TOTAL = $172,500



TAXABLE VALUE

$325,000

$177,500

NOTE: The maximum exemption for homes valued at $500,000 or more will be $195,000.

Click here to use the Save Our Homes/Super Exemption Comparison Calculator

QUESTION: Will the Save Our Homes 3% limitation apply to the Super Exemption?
ANSWER: New applicants will benefit from the Super Exemption that can be worth up to $195,000. The 3% assessment limitation under the previous $25,000 Homestead Exemption will not apply to new owners. Only current recipients of the $25,000 Homestead Exemption and assessment limitation will have a one time option to continue with that benefit, or change to the Super Exemption.

QUESTION: When will I be required to make a choice between my current $25,000 Homestead Exemption and the Super Homestead Exemption?
ANSWER: If voters approve the changes in the January referendum, the Property Appraisal Department will write to all property owners formally informing them of the change and advising them of the timeframe within which they must make that choice.

QUESTION: If the changes are approved and I buy a new house, will I be able to apply for the Homestead Exemption and 3% Save Our Homes cap, instead of the Super Exemption?
ANSWER: If the Super Exemption passes on January 29, new applicants will benefit from the Super Exemption worth up to $195,000. The older $25,000 Homestead Exemption and 3% assessment limitation will no longer be an option for new applicants.
Homeowners who currently have the $25,000 Homestead Exemption can choose to keep this and their 3% cap as long as they retain ownership of that home and maintain that home as their homestead.

QUESTION: Will the Super Exemption affect my new $50,000 senior exemption?
ANSWER: No. The $50,000 senior exemption will still apply with the new super exemption.However, the super exemption applies to all taxing agencies while the $50,000 senior exemption only applies to county taxes and taxes in some cities.

RENTERS
QUESTION: I live in a rented home. Does this tax rate cut affect me?
ANSWER: The new tax rate directly affects owners of rental properties by reducing their overall property tax bills. This reduced tax obligation should reduce a property owner's overall operating expenses.

BUSINESS OWNERS
QUESTION: Are there any new benefits for businesses?
ANSWER: Business enterprises will benefit from the rollback of tax rates to 2006 levels, in that these reductions apply to Tangible Personal Property (TPP) such as computers and office furniture.Additional benefits will accrue to business owners if the changes being put to voters in the January 29 referendum are approved by more than 60 percent of those who vote. Under those changes businesses will be able to apply for a $25,000 exemption on Tangible Personal Property.

Lynne RohdeMortgage Loan Consultant Security One Mortgage Corp. (407) 681-9800 x 104Fax: (407) 650-2921 LMRECO@aol.comhttp://www.securityonemortgage.com/lynnerohde

To date, subprime mortgages have been credited for bankrupting well over 110 lenders and seriously damaging operations at many major mortgage firms. They've reportedly wiped out 5 hedge funds, tens of thousands of jobs, and have led to millions of foreclosures with millions more on the way. And, as if that weren't enough, subprime mortgages are also blamed for massive volatility in the stock, bond, credit, futures, and real estate markets here in the US. And it's this volatility that is now spreading like a virus into other major financial sectors around the globe. This means that, for any American looking to buy, sell, or refinance their home, they are confronting a very different market from the one that existed just 6-12 months ago. The US Federal Reserve has already begun pumping billions of dollars into the US banking system in order to address what is clearly a credit crisis that will change how we borrow money for years to come! The recent real estate boom was fueled by a period of record home appreciation and historically low interest rates. Banks, in order to compete, loosened guidelines and began offering more funding to more borrowers through riskier, non-conforming mortgages. These ideal lending conditions persisted for several years, supported by high demand, historical real estate data, home prices, and massive trading volume/profits on mortgage-backed securities and other financial instruments on Wall Street. Then, in 2006, a slowdown in real estate led to a deterioration of home values, an increase in inventories, and ultimately to today's tightening of credit guidelines, leaving many investors unable to sell or refinance out of their existing positions. Many Americans who had tapped into their equity were suddenly tapped-out and overextended as home values fell. Foreclosures followed in record numbers and a re-valuation of mortgage bonds and other financial instruments created the credit/liquidity domino effect we're now experiencing. Unfortunately, it's going to get a lot worse before it gets better. According to the latest estimates, over 2 million subprime and Alt-A adjustable rate mortgage (ARM) holders will face payment increases of up to 30%-100% when their loans reset in the next 2 to 18 months. These loans make up less than 40% of the total mortgage market, but the negative effects, as we have seen, of increased foreclosure activity can have a ripple effect throughout the industry and around the globe. What does this mean to you and your mortgage?

Sellers: If you're planning on selling your home, be prepared for an even smaller pool of qualified buyers. While some experts predict a settling of this credit crisis over the coming year, tightened credit guidelines and diminishing mortgage products could knock out as many as 15%-30% of potential qualified buyers. Now is not the time to sit and wait for the best possible price. Have a serious talk with your Real Estate Agent. Having experienced buying/selling transactions in your area, he or she can help you price your home accordingly. He or she can also help ensure that your buyers are pre-approved and stay pre-approved throughout the entire transaction.

Buyers: Get pre-approved by your mortgage professional. While there are a lot of great deals out there, getting credit is becoming tougher and tougher, and it's taking longer and longer to complete a transaction. Remember, what you qualify for today could change tomorrow in a volatile market. For those looking to refinance, keep this in mind. There is no time to delay! Communicate with your lender. Don't do anything that could negatively affect your credit, and make sure you get all your documentation in on time.

ARMs Borrowers: If your ARM is scheduled to reset in the next 2-18 months, you need to schedule an appointment with a mortgage professional right away. Whether your ARM is subprime, Alt-A, or even if you have a pre-payment penalty, don't let a default or foreclosure situation sneak up on you. Did you know that your monthly payments can increase anywhere from 30% to 100% once your loan resets? At the very least, give yourself the peace of mind of knowing what your adjusted payment will be. A good loan officer can help calculate the numbers.

Borrowers with less-than-perfect credit: Each week it seems lenders are shedding more and more mortgage products. Many lenders have stopped offering No-Doc loans and are reducing all forms of Stated-Income loans. While it might be challenging, borrowers with credit issues need to see a loan expert. Often they have credit repair resources and other strategies to help you reach your financial goals.

Finally, don't let the headlines get to you. While all looks bleak and scary now, there's an important concept to embrace: all markets, while cyclical in nature, are self-correcting, be it credit, real estate, stocks, or bonds. For the last 6 or 7 years, real estate was booming and riding high. The correction we're experiencing now – while it seems harsh and could get much worse – is, in a sense, "natural" and directly related to the extremely loose guidelines and perhaps overzealous lending and leveraging during the boom cycle. If you or someone you know would like to learn more about the credit crisis and how it could affect your financial goals, please call us at (407) 681-9800 x 104 to set up an appointment. We would be happy to speak with you about it!

Florida foreclosure activity drops, but state is still a national leader
Tampa Bay Business Journal - 11:49 AM EDT Tuesday, August 21, 2007 One of every 431 homes in Florida is now in foreclosure. While the state is second only to California in the number of foreclosures filed, Florida is down 9 percent in foreclosure activity from July 2006, according to a monthly report from RealtyTrac. Read the rest of the story here: http://www.bizjournals.com/tampabay/stories/2007/08/20/daily16.html?f=et83&ana=e_du

Most-depreciating metropolitan areas ranked by zillow
Most-depreciating metropolitan areas (year-over-year):
• Sarasota-Bradenton, Fla. (-16.4 percent)
• Melbourne-Titusville-Palm Bay, Fla. (-14.3 percent)
• Stockton-Lodi, Calif. (-13.5 percent)
• Charleston-North Charleston, SC (-12.8 percent)
• Daytona Beach, Fla. (-12.5 percent)
• Modesto, Calif. (-12.4 percent)

Snippet from Florida Association of Realtors:
Read the whole story:http://www.floridarealtors.org/NewsAndEvents/n4-081407.cfm

Foreclosures: for novices, it’s a crapshoot
NORTH PALM BEACH, Fla. – Aug. 14, 2007 – The allure of foreclosed properties to a would-be real estate investor is nearly irresistible: Buy valuable properties for pennies on the dollar with little or no risk of your own money, work when you feel like it, and grow rich.

It's important to understand:
There are three distinct phases of foreclosures, each with its own advantages and each fraught with peril:

Preforeclosure: The time between when the homeowner has stopped making payments and when the land is actually put up for sale at auction. Investors take this opportunity to deal directly with the homeowner.

Auction: When the courts seize the property from the homeowner and sell it to the highest bidder. The county sheriff or a trustee handles this process, depending on the state.

REO: If the property fails to sell at auction, or if the lender ends up as the highest bidder, the home becomes REO, or “real estate owned” by the bank. Banks then try to sell these REO properties on the open market, often through a real estate agent or third-party marketing company.Often these homes are sold to buyers who don’t even know they are buying a foreclosure, and go through the entire process as they would with any other home.

Going once . . .The typical foreclosure is literally bought on the county courthouse steps during a sheriff’s auction or a trustee’s sale. These auctions are typically held on a weekday morning, and bidders must come to the sale armed with information and flush with cash or its equivalent. Plastic, personal checks and IOUs are almost universally shunned at auction and, depending on where you live, investors usually must make a sizable deposit or pay the entire sum on the spot.

Details vary widely by state, but as a rule, prospective buyers are not allowed inside the house before bidding begins. This is a frightening concept for many buyers, who must lay down thousands of dollars in cash up front without knowing anything about the home beyond what is available through basic public records searches and a curbside appraisal.The house could be infested with termites, gutted to the rafters by previous residents or filled with lead paint or asbestos, and a buyer wouldn’t know until after the sale is final. This as-is aspect of auctions is only part of what can make foreclosures so perilous for beginning buyers.

Another is that these homes can never be guaranteed to come with a clear title.“You can never be absolutely sure you are going to be buying a house with a clean title in any sale, but foreclosures are particularly problematic,” says John Mixon, law alumni professor at University of Houston Law Center.During a typical foreclosure auction, the homes that will be sold are listed in the legal advertising section of the county’s newspaper of record at least a week before the sale. And while you may have a week to research the records and history for each house scheduled for auction, many homeowners settle their dispute with the bank at the 11th hour, halting the sale. This means any time, effort or expense you invested to research the home is lost.


Given these constraints, obtaining title insurance is out of the question.But choosing to forgo title research could end up being infinitely more costly. “There are so many regulations, so many procedures that if you leave out a step, a previous owner may come out of the woodworks and show this to the court and you lose everything you put into the deal,” Reed says.


Not all hopelessBut all that doesn’t mean every auction deal is hopelessly risky.“Very few institutional foreclosures are defectively handled,” Mixon says, so the best bet is to stick to homes that were foreclosed by reputable lenders, but only if they were the first lien holder, usually through a first mortgage. If the deal was done properly on the front end, complete with title insurance, there’s less likelihood that a skeleton is lurking, and about a 90-percent chance of getting a good title.

Government auctions, Another variation on the auction is buying properties foreclosed by a government agency, such as the Department of Housing and Urban Development or the Veterans Administration.These auctions are typically conducted online through a marketing company. Buyers are allowed to tour the homes in advance, conduct inspections and can often get title insurance.While these auctions are appealing, the availability of homes is limited and the small stock is often bid on by several buyers, making it a very competitive market with prices discounted only slightly, if at all, off current market value.

Tabletop negotiations---One purchase method advocated by numerous seminars and real estate gurus is to find property owners delinquent in their payments through legal ads or online services that search public records and courthouse documents. You could then approach the owner directly to negotiate a private deal. Advocates of this method call it “buying equity.” Essentially, investors pay the owner a fee and then take over the existing debt and the home. This keeps protects the homeowner’s credit report from the black mark of foreclosure. Buying equity this way is difficult if a seller’s market exists because the owner could just as easily sell the home and usually pocket a greater amount in appreciation than an investor would be willing to pay.“Some people call this stealing property,” Reed says.

Sale mentality---Despite all the potential pitfalls, interest in foreclosures runs high. Part of the attraction comes from the same motivation that makes bargain shopping trendy, says C.J. Gehlke, editorial director of “The Resource,” a monthly newsletter published by REO Nationwide.“What you find is a frenzy similar to what you get at a department store sale,” she says. “When you buy a house at foreclosure, it has the same mystique. You can brag to people at a cocktail party about how much you saved.”

Read the whole story:http://www.floridarealtors.org/NewsAndEvents/n4-081407.cfm