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$15,000 homebuyer tax credit, higher loan limits, lower rates in play
Question: Allison, what is the deal with the new stimulus package and how will it affect the average Summit County home buyer?
Answer: According to Inman News reports, a $15,000 homebuyer tax credit, higher loan limits for Fannie Mae, Freddie Mac and FHA, and government spending to lower mortgage rates are all in play as Congress and the Obama administration come to agreement on an economic stimulus bill and financial stability plan for banks.
The Senate approved an $838 billion economic stimulus bill that includes a $15,000 homebuyer tax credit, just hours after President Barack Obama's new Treasury secretary unveiled a multitrillion-dollar financial stability plan that includes $50 billion for foreclosure prevention programs.
The financial stability plan may also lead to an expansion of existing efforts by the Federal Reserve to drive down mortgage interest rates by buying mortgage-backed securities and debt issued by Fannie Mae, Freddie Mac and Ginnie Mae.
The National Association of Home Builders welcomed the Senate's move, saying a $15,000 tax break for all homebuyers could generate nearly 500,000 home sales and create more than 255,000 jobs.
NAHB Chairman Joe Robson said the enhanced tax credit would be "a powerful incentive for homebuyers to get off the sidelines" and urged Congress to make sure the full $15,000 tax credit is included in the final stimulus plan.
The housing program will also establish loan modification guidelines and standards for government and private programs, and require all institutions receiving assistance through the financial stability plan to participate in foreclosure mitigation plans. The Obama administration will also build additional flexibility into the FHA's Hope for Homeowners refinance program to enable more distressed borrowers to participate.
While the main goal of the stimulus bill is to create jobs, the financial stability plan is designed to strengthen banks and restart the flow of credit to homeowners and small businesses, Geithner said. Currently, the financial system is working against recovery, even as the recession puts greater pressure on banks, he said.
"This is a dangerous dynamic, and we need to arrest it," Geithner said. The battle for economic recovery must be fought on two fronts -- by jump-starting job creation and private investment, and by getting credit flowing again to businesses and families.
As it has done under the TARP program, the Treasury will continue to invest in banks that need additional capital, but will now impose conditions to ensure "every dollar of assistance" is used to generate additional lending, Geithner said.
In addition, the Treasury, Federal Reserve and Federal Deposit Insurance Corp. will establish a $500 billion Public-Private Investment Fund to buy up toxic loans and assets. The fund could ultimately provide up to $1 trillion in financing, Geithner said, helping to create a market for real estate-related assets that are "at the center of this crisis."
The Treasury and Federal Reserve will also commit up to $1 trillion in backing for a consumer and business lending initiative, building on the Federal Reserve's Term Asset Backed Securities Loan Facility (TALF) announced in November. The program will be expanded to target markets for small business lending, student loans, consumer and auto finance, and commercial mortgages.
Although I do have fears about the long-term consequences of all this money and spending, the permanency of some of the programs, increasing government even more, I welcome with open arms the assistance that is obviously needed today.
This is certainly a difficult situation, one that has no easy answers. In many respects, both sides have been right and wrong, but it is great to see that we can start putting all of this behind us.
 
To me, the current situation feels like being in a strange town, in the dark in a foggy night, without a map. This plan, flawed as it may be, feels a lot like having been given a general map pointing to all the cardinal points (N, S, E, W), allowing us to at least figure a way out. As the rest of the plans are announced and implemented, they will hopefully add layers to this map with highways, and eventually, individual roads for all of us to travel with great visibility into the future.
 
For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Allison is a long time local in Summit County. Summit Real Estate – The Simson/Nenninger Team is located at the Dillon Ridge Marketplace. Allison’s long-time residency and years of real estate experience can help you make the most of any buying or selling situation. She’s a Certified Residential Specialist (CRS), the highest designation awarded to a Realtor in the residential sales field. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com   
Question: Allison, I see that you have the designations of CRS, RSPS and GRI behind your name. What do those initials mean? Don’t all Realtors have the same basic education?
 
Answer: The basic education for all Realtors is indeed the same. The initials of CRS, RSPS and GRI indicate that that Realtor has had extra continuing education.
 
I feel that it’s important when hiring a Realtor, to find one who has earned extra designations. The question is what are the designations that are important to look for?
 
The designation “GRI”, which stands for “Graduate Realtors Institute,” is earned through the National Association of Realtors. It requires that a real estate agent complete at least 90 hours of course work on different subjects ranging from mortgage financing to real estate law.
 
An even tougher designation to get is the “CRS” designation, which stands for “Certified Residential Specialist”. It is earned through the Realtors National Marketing Institute. This Institute also sets the guidelines for the “CRB” designation, which goes to highly trained real estate brokers. 
 
RSPS is for Resort and Second Home Property Specialist. A critical designation for Brokers in Summit County – and a great network of Resort Brokers around the country.
 
 
For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Allison is a long time local in Summit County. Summit Real Estate – The Simson/Nenninger Team is located at the Dillon Ridge Marketplace. Allison’s long-time residency and years of real estate experience can help you make the most of any buying or selling situation. She’s a Certified Residential Specialist (CRS), the highest designation awarded to a Realtor in the residential sales field. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com   
Question: We have an older rental property that we want to sell. We haven’t lived in it for years. It needs some work and want to sell it “as is”. What do you advise?
 
Answer: Think about the last time that you went to buy a used car. Were you more attracted to the dealerships that offered used car warranties or the places that advertised “as is”? In real estate, just like in the used car world, “as is” may suggest that there are defects the seller is either trying to hide or is unwilling to fix.
 
When a buyer hears a home is being listed “as is,” he is more wary of the property. Sellers often advertise their property this way because they think it will mean the end of their responsibility to the buyer. This is really not true. Sellers are obligated, by law, to disclose of any and all known defects to a buyer even if they say the home is “as is”.
 
You’ll save time, increase the chances of a sale, and probably net more dollars if you fix up the property as economically as possible – typically this would include general clean up and perhaps a coat of fresh paint throughout. Then, when you fill out the property disclosure, which will be given to your buyer, inform your new buyer about those items that are still problems in the property.
 
For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Allison is a long time local in Summit County. Summit Real Estate – The Simson/Nenninger Team is located at the Dillon Ridge Marketplace. Allison’s long-time residency and years of real estate experience can help you make the most of any buying or selling situation. She’s a Certified Residential Specialist (CRS), the highest designation awarded to a Realtor in the residential sales field. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com   
 

Bridge Loans Offer Flexibility

by Allison Simson & Joyce Nenninger
Question: We want to purchase a new home and get ours onto the market. What happens if we find something we want to buy before we get our existing place sold?
 
Answer: That’s a good question and it is a situation that many people find themselves in as they are making the transition from one property to another. Imagine for a moment that you have found the perfect new home for your family. It’s in just the right neighborhood that you’ve always wanted to live in and you absolutely love it! The problem is you haven’t sold the home you own now. 
 
You could make an offer on the new home contingent on selling your existing home first, however, most sellers are reluctant to except such an offer. If they do accept your offer, you will probably end up paying more for the property as a result. Having to make a contingent offer almost always results in a major loss of your negotiating power.
 
Writing a contingent offer may also cause you to become more desperate when trying to sell your first home.
 
You may accept an offer you wouldn’t normally have considered just because you don’t want to lose your new dream home.
 
This is where bridge loans can be a lifesaver. Bridge loans allow you to use the equity on your existing home as collateral on a new home loan. You then put your home on the market and when it sells or at the end of the loan term, you pay off the bridge loan.
 
Most lenders offer more flexible terms for bridge loans than for standard mortgage loans. To alleviate the financial burden of making double house payments, lenders will design more lenient repayment terms. Some will simply defer payment until your existing home sells. Other lenders will have you pay only interest payments, which are much lower, and then the principal would be due when the house is sold or at the end of the loan term.
 
Generally, most lenders set a maximum loan to value ratio of 75%. Meaning you can only borrow up to 75% of your homes value, minus the amount of the existing mortgage.
 
If you would like more information on bridge loans or any type of mortgage financing, give me a call. I’d be happy to get you started in the right direction.
For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Allison is a long time local in Summit County. Summit Real Estate – The Simson/Nenninger Team is located at the Dillon Ridge Marketplace. Allison’s long-time residency and years of real estate experience can help you make the most of any buying or selling situation. She’s a Certified Residential Specialist (CRS), the highest designation awarded to a Realtor in the residential sales field. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com   

Older home that seems to have a lot of surges in power

by Allison Simson & Joyce Nenninger
Question: We have an older home and seem to have a lot of surges in power. We have purchased a surge protector for our computer but wonder if we need them for our other more expensive appliances.
 
Answer: Homeowners possessing numerous expensive appliances such as VCRs and computers should equip their house with a whole-house surge suppressor rather than individual plug-in surge protectors. Power surges can occur very easily, be it from turning on a home appliance or from receiving an energy surge from a nearby source, and these frequent surges can gradually break down a home's wiring insulation. A whole-house surge suppressor, which several companies will install complete with a $10,000 damage warranty, will offer the best protection for expensive appliances. These suppressors can either be mounted on the circuit break box, mounted under the electric meter, or installed into a snap-in circuit breaker. The level of protection depends on the model, but certain features to look for are the magnitude of the surge that can be dissipated, the speed of reaction, and the amount of voltage that triggers a surge block. Some new suppressors are also designed to protect a home's phone, cable, and modem lines. 2009 Information.Inc.



 
 
For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Allison is a long time local in Summit County. Summit Real Estate – The Simson/Nenninger Team is located at the Dillon Ridge Marketplace. Allison’s long-time residency and years of real estate experience can help you make the most of any buying or selling situation. She’s a Certified Residential Specialist (CRS), the highest designation awarded to a Realtor in the residential sales field. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com   
Question: We want to challenge the tax assessment on our home. How can we get some assistance in this?
 
Answer: Although some real estate industry members attest that local home assessors have become more accurate over the years, homeowners who wish to challenge a tax assessment can do so with the help of a real estate practitioner. First, conduct your own comparative research using the area "comps" listed on the assessment slip. Take note especially if your home features fewer bedrooms or baths than the nearby comps. Request a "comparative market analysis" from a trusted practitioner. This data will balance your home against recent area home sales. A professional appraisal could also be conducted at a cost of between $250 and $275. Recent homebuyers should refer to the sales contract for evidence of the home's value. Next, request an "informal conference" with the assessor in order to present your findings. If the results of this meeting are unfavorable, file a formal appeal with the Board of Equalization in the timeline specified. Be aware however, that the board may actually raise your assessment. While a lawyer is not needed at this stage in the process, homeowners who choose to challenge the board may require legal counsel. 2009 Information.Inc.
 
For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Allison is a long time local in Summit County. Summit Real Estate – The Simson/Nenninger Team is located at the Dillon Ridge Marketplace. Allison’s long-time residency and years of real estate experience can help you make the most of any buying or selling situation. She’s a Certified Residential Specialist (CRS), the highest designation awarded to a Realtor in the residential sales field. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com   

Tips for Negotiating seller to pay mortgage points on buyers behalf

by Allison Simson & Joyce Nenninger
Question: We’re negotiating the sale of our home and are going back and forth with the buyer about paying mortgage points on behalf of the buyer. What do we need to know about paying this fee for the buyer?
 
Answer: When negotiating a real estate transaction, buyers can request that the seller pay all or some of the mortgage points. Typically equivalent to 1 percent of the total loan amount, points are basically fees charged by the lender. Points must be paid in cash at the time of settlement, and potential homebuyers should be aware that points are directly related to the annual percentage rate. When shopping for a mortgage loan, watch for no-point loans and secure a loan at the lowest interest rate possible. However, keep in mind that buyers can also deduct mortgage points from their tax return, whether the seller has paid for them or not.
 
Sellers also stand to benefit from covering mortgage points for the buyer since it reduces their capital gain. In other instances, sellers who've occupied the home for at least two years may not need to reduce their capital gain, especially if profit from the home sale doesn't exceed the statutory dollar amounts of $250,000 or $500,000. However, buyers and sellers who plan to deduct mortgage points should be careful to delineate on the settlement sheet, what figures cover points and loan origination fees. These figures must be calculated as a percentage of the stated principal amount of the loan, and the amount of points charged must correspond to similar mortgage loans in the immediate area. Finally, the loan must be secured by the principal residence and points paid directly by the taxpayer. Be sure to consult your own tax consultant to determine how this information applies to your situation. 2009 Information.Inc.
 
For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Allison is a long time local in Summit County. Summit Real Estate – The Simson/Nenninger Team is located at the Dillon Ridge Marketplace. Allison’s long-time residency and years of real estate experience can help you make the most of any buying or selling situation. She’s a Certified Residential Specialist (CRS), the highest designation awarded to a Realtor in the residential sales field. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com   

Can't afford remodeling our kitchen! Do you have any suggestions?

by Allison Simson & Joyce Nenninger
Question: Wow, we just got a bid back from a contractor for remodeling our kitchen. There’s no way that we can afford the whole project right now. How should we get started?
 
Answer: Rather than completely renovating their kitchen, some homeowners, particularly those on tighter budgets, tackle smaller jobs, such as reviving their kitchen cabinets. The renovation of cabinets can include refinishing, repainting, and replacing handles and hinges, among other things; and the entire project often costs only a quarter of the price for a complete renovation. Luis Terry, of Best Kitchen Cabinets in Rockville, Md., provides a number of wood and finishing samples to show to homeowners. When actually performing the project, solid wood can be refinished easily, but doors must be stripped and smoothed by hand in a shop. The cabinet's frame must also be finished or painted to match the doors. After the project is completed, the homeowner should polish the wood, and they should prevent buildup of grease or food particles on the cabinets. The entire project can take about two weeks, but most of the work will actually be done at a wood shop. When renovated properly, solid wood cabinets can last 30 to 40 years, says Terry. 2009 Information.Inc.
 
 
For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Allison is a long time local in Summit County. Summit Real Estate – The Simson/Nenninger Team is located at the Dillon Ridge Marketplace. Allison’s long-time residency and years of real estate experience can help you make the most of any buying or selling situation. She’s a Certified Residential Specialist (CRS), the highest designation awarded to a Realtor in the residential sales field. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com   
 

We want to buy a home here in Summit County but don’t know where to begin!

by Allison Simson & Joyce Nenninger
Question: We want to buy a home here in Summit County but don’t know where to begin. My wife and I don’t seem to agree on what this house should be like. How do we get started?
 
Answer: Most homebuyers base their decision mainly on price and location, studies show. Other important elements are space, renovated kitchens and bathrooms, a home office, energy efficiency, and modern amenities. Although many of these elements can be added later, some buyers prefer to purchase a house that already contains what they want. When deciding what type of home to buy it can be helpful to make a list of both wanted and needed features in a home--this list, which can include any specialized features, can easily be generated by first considering unappealing aspects of the home. Buyers should give their real estate agent a copy of the list, and they should take a copy with them whenever they are out house hunting. Nonetheless, buyers often find themselves swayed by a house's ambiance and forgetful of their carefully constructed list. While atmosphere is important, to ensure a long-lasting happiness in the home, it is best for buyers to make sure it actually contains some of the features they want. 2009 Information.Inc.
 
For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Allison is a long time local in Summit County. Summit Real Estate – The Simson/Nenninger Team is located at the Dillon Ridge Marketplace. Allison’s long-time residency and years of real estate experience can help you make the most of any buying or selling situation. She’s a Certified Residential Specialist (CRS), the highest designation awarded to a Realtor in the residential sales field. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com   

Some sunny news about the market!

by Allison Simson & Joyce Nenninger
I just received this article from Rod Shuster, a Mortgage Broker at Clarion Mortgage Capital, and I think it bears repeating – some sunny news about the market!
MARKET RECAP
A funny thing happened on the way to the depression: A recovery occurred. Over the past two weeks, the two major stock-market barometers – the Dow Jones Industrial Average and the S&P 500 Index – have surged nearly 20%. The good news embedded in the surge is that the stock market is one of the more reliable indicators on the likely direction of the economy.
There are a number of reasons investors are feeling more upbeat these days, none more important than the improving housing market. Last week, the National Association of Realtors reported that sales unexpectedly increased 5.1% to an annual rate of 4.72 million in February, as foreclosures pushed down prices and lured first-time buyers into the market.
Lower prices are also driving new-home sales, which rose 4.7% last month to a 337,000 annual rate. Homebuilders have been aggressively discounting, with the median sales price for a new home falling to $200,900 from $251,000 in February 2008. But it's worth noting that the median price for a new home is still high compared with the median sales price of $165,400 for an existing home.
Lower mortgage rates are an important factor in the nascent housing-market recovery. In fact, rates aren't just lower they are the lowest they've been since Dwight D. Eisenhower was president. According to the National Bureau of Economic Research, the average rate on a 30-year, fixed-rate FHA-insured mortgage was 5.15% in December 1956. That's about where we are today, and depending on credit scores, income levels, and debt ratios, many borrowers are getting mortgage rates below 5%.
The return of the mortgage-asset market is another sign sunny days might be just over the horizon. It didn't receive much press coverage last week, but both Citigroup and Bank of America have been aggressively buying AAA-rated mortgage-backed securities, including some that use alt-A and option adjustable-rate mortgages as collateral. Citigroup and Bank of America obviously believe these assets are a good investment, which means many other investors are likely thinking the same thing, and that could be very good news for the credit markets. Rising mortgage asset prices will further bolster banks' balance sheets, enabling them to turn up the lending spigot.
For more information, contact Rod Shuster at www.shusterinc.com or 888.660.4210.
 
For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Allison is a long time local in Summit County. Summit Real Estate – The Simson/Nenninger Team is located at the Dillon Ridge Marketplace. Allison’s long-time residency and years of real estate experience can help you make the most of any buying or selling situation. She’s a Certified Residential Specialist (CRS), the highest designation awarded to a Realtor in the residential sales field. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com   

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Summit Real Estate
The Bright Choice
330 Dillon Ridge Way, Suite 10
Dillon CO 80435
970-468-6800
800-262-8442
Fax: 970-468-2195

Allison Simson, Owner/Broker, is a licensed Colorado Real Estate Broker