Unprecedented FREE Mortgage Protection Program

The California Association of Realtors is offering an unbelievable Mortgage Protection Program. It is called HAF, which stands for Housing Affordability Fund. This program gives first-time homebuyers who lose their jobs or become disabled up to $1500 per month for up to six months to help make their mortgage payments.

This is a great program for first time homebuyers who want to buy and take advantage of the amazing tax credits, but are worried about their employment. Click on the link below to find out how to qualify and apply.

http://www.car.org/aboutus/hafmainpage/carhafmortgageprotection/

Mortgage Forgiveness Debt Relief Act and Debt Cancellation of 2007

In the past couple of days I have heard several different things about whether homeowners are responsible for paying tax on the amount forgiven during a short sale, mortgage restructuring or a foreclosure. I decided to do some research and on the IRS website I found exactly what I was looking for. Be sure to click through; you will find a great Q & A section that answers some of the most commonly asked questions, plus lots of other useful information regarding what is included and excluded in the Debt Act.

Short Sale

One hot topic discussed on the IRS site is the Short Sale. This is when someone owes more money on their home than they are able to sell it for. As an example, someone owes $200,000 on their home, but can only sell it for $130,000. What happens to the other $70,000? Many people have asked me, “Do I have to pay back the difference?” or “Will I owe anyone when this is done?” In brief, the answer is no, you will not have to repay the difference, if the bank agrees to accept a Short Sale; they accept less than what you owe.

There are certain things a bank is looking for when accepting a Short Sale. For example, they want to make sure that you are unable to make your payment due to a substantial pay cut, disability, job loss, or death. Contact your lender directly and ask what you need to submit if you are considering a Short Sale. Most banks also list this information on their websites.

Debt Forgiveness

Prior to December 2007, the $70,000 difference described above would have been taxable income and therefore included on your taxes. The Mortgage Forgiveness Debt Act of 2007 allows taxpayers to exclude income from the discharge of debt on their principle residence. Basically, the Federal Government recognized that taxing homeowners that had just lost their homes was not be the answer to improving the economic troubles. The forgiven debt still needs to be reported on Form 982 and attached to your tax return. Your lender will send you a form 1099-C, cancellation of debt, showing the amount of debt canceled for you to file along with your taxes.

It's Open....come on in!

I am sitting at an open house, and haven't had one person thru yet. Since I’m new to the "resale" world, I wasn't sure what to expect. I’ve heard that holding an open house is not worth the time, that open houses are excellent sources of leads, and that open houses are dangerous.

Not worth the time? I’m conducting valuable research on the community that I can pass along to my clients, for instance, I’ve learned that this is a very quiet neighborhood during the daytime. Excellent source of leads? Not so far, but it’s hard to pass judgment based on one experience. And as far as the danger.....nothing but a couple of irritating mosquitos. Could be the GREEN pool and spa in the backyard of this home (and by that I mean the color of the gunite, not the method of construction or the state of the water).

As for the home itself, it is a darling 4 bedroom, 2 bath on a nice corner lot for only $209,990. Did I mention the pool and spa?!?