Posts tagged as:

homebuyer tax credit

Bernanke Says Interest Rates to Stay Low

by Chris McLaughlin on March 18, 2009

Real Estate News & Commentary by Chris McLaughlin, March 18, 2009
http://www.shortsalesriches.com/welcome.html

——–

“2 Careers That Boom in a Recession!”
I’ll tell you about one of these for fr*ee
in my no-charge, no-cost, no-obligation
webinar right here live on Thursday night at
8:30 PM ET, 5:30 PM PST:

https://www2.gotomeeting.com/register/995947853

Why would I do that for no charge? Because
I want a chance to tell you about the other
high-income opportunity, too.

And I can’t do it in an email.

But if you’re finally ready to blast out of
this economic mess, then get a move on… I’d
hate for you to miss out, because we always fill
up a day or so early. See if there’re any spots
left:

https://www2.gotomeeting.com/register/995947853
———

Interest rates will stay low

Economists predict Fed Chairman Ben Bernanke and his colleagues will hold the lending rate between zero and 0.25 percent for the rest of this year and for most, if not all, of next year to combat the recession we’ve been in since December 2007. Of course with a lending rate this low, the Fed is just about powerless in the face of recession, but that’s not stopping them from meeting to talk about it. The options still remaining are: 1) buying long-term Treasury securities, and 2) boost its purchases of debt issued or guaranteed by mortgage giants Fannie Mae and Freddie Mac. Both options would help depress mortgage rates. Hopefully they won’t adopt the latest fad on Wall Street as option number 3 — voting themselves bonuses.

Homebuyer tax credit now law

The homebuyer tax credit, one is one of 10 key provisions of the so-called American Recovery and Reinvestment Act, was signed by President Obama into law yesterday. The bill provides for a $8,000 tax credit that would be available to first-time home buyers for the purchase of a principal residence between January 1, 2009 and December 1, 2009. Home buyers won’t have to repay the credit, which they can apply dollar for dollar against 2009 taxes, and if there happens to be an unused portion of the credit, it will be mailed to the purchaser.

Inflation rears its head

The Labor Department says gasoline prices and clothing costs leaped the most in nearly two decades in February, driving a rise in consumer inflation of 0.4 percent in February. Core inflation, which excludes food and energy, rose 0.2 percent in February, slightly higher than the 0.1 percent rise economists expected. Can anyone guess what it’s called when interest rates stay low while prices go up?

Mortgage applications jump – sort of

Mortgage refinancing applications jumped 30 percent in the week ended March 13 as the borrowing rate dipped 0.07 of a percentage point to 4.89 percent, tying the record low reached in early January in a survey that dates to 1990. Of course purchase applications only rose 1.5 percent. Refinancing requests represented about 73 percent of all mortgage applications last week.

Foreclosures up

Foreclosure filings are up 30 percent from a year ago. The states with the highest foreclosure rates so far are Ohio, Oregon, Georgia, Illinois, Michigan, Idaho, Florida, California, Arizona, and Nevada, where a whopping 1 in every 70 households are in foreclosure. Viva Las Vegas!

Merrill Lynch on the hot seat

As if AIG wasn’t enough, now Merrill Lynch is under the gun for $3.62 billion in 2008 year-end bonuses. Rep. Edolphus Towns (D., N.Y.), chairman of the House Committee on Oversight and Government Reform, in an effort to determine whether the committee had been misled about the bonuses, sent letters to Bank of America requesting records of the incentive payments.

Now on to our real estate investing education section …

Top Ten Foreclosure States & Investing In Short Sales

Getting started in short sales and real estate foreclosures doesn’t need to take months; with a little help from your friends here at the ShortSalesRiches.com blog you can be making an offer on your first property in less time than it takes to open a new bank account to stash all that cash and big profits. But should you focus your efforts on foreclosures or short sales? Does it really matter? Maybe more than you think.

First, let’s take a few minutes to find out where all the foreclosures are taking place. While every state has its fair share of foreclosures and potential short sale properties, according to Forbes, the top ten foreclosure states are currently:

1. California

2. Florida

3. Arizona

4. Nevada

5. Illinois

6. Michigan

7. Ohio

8. Texas

9. Georgia

10. Virginia

Now, back to the main question; foreclosures or short sales? While both may offer a real estate investor major profit potential, short sales provide the unique perspective of less competition. Never underestimate the hype and hysteria that takes over an otherwise sane buyer in the heat of the moment or during an auction. Fear and greed plus a good healthy dose of competition can drive a would be cash cow into the ground when dealing with auctions and foreclosure sales. Bidding wars are not unusual so be prepared well in advance. On the other hand, short sales often rely upon individual negotiations where time is on your side.

Additionally, buying a property prior to foreclosures results in reduced prices since the lender hasn’t been required to deal with months of unpaid mortgages, vandalism, paper-work and other problems. In general, the sooner you claim a property the more is saved – savings that pass directly to you. Short sales can sometimes generate greater profit potential than foreclosures although there are exceptions to every rule…and trust me, I’ve seen plenty of short sales end up as REOs after stubborn lenders refuse to drop their prices, only to see the property eventually sell for $100k less than was offered as a short sale! Lucky for us banks are getting a little smarter. But notice I said a “little” smarter. They are still pretty dumb.

See you at the top!

Chris McLaughlin

http://www.shortsalesriches.com/welcome.html

P.S.

Don’t miss out webinar this coming Thursday night at 8:30 PM ET, 5:30 PM PST:

https://www2.gotomeeting.com/register/995947853

http://www.shortsalescoach.com
http://www.shortsalesriches.com
http://www.reomillionaireclub.com
http://www.sixfigurebpo.com *************************************************
Finally, a blog for Real Estate professionals
that want up-to-the-minute news, & how it impacts
us and our market…

http://www.shortsalesriches.com/blog

*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month

   * Long-time authority on real estate investing
      and rapid flipping of distressed homes. Owns
      portfolio of nearly 100 high-value, high-profit
     properties

    * Owner and Supervising Broker of one of Florida’s
     largest Real Estate firms, running 4 different
     offices, supporting nearly 450 agents, uniquely
     positioning him to help thousands of investors
     make money in the biggest market opportunity ever!

     * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
      in Real Estate Investing, Entrepreneurship, and
      Wealth Building

* On twitter: http://twitter.com/mclaughlinchris
* On facebook: http://www.facebook.com/addfriend.php?id=709199143

—

{ 0 comments }

The Stimulus Package & Its Impact on Real Estate

by Chris McLaughlin on February 16, 2009

Real Estate News & Commentary by Chris McLaughlin, February 16, 2009
http://www.shortsalesriches.com/welcome.html

—-
“How to Exploit a Little Known Flaw in the Bailout
Package for a Six-Figure Payday!” (But it’s only
good for the next 14 months…)

I don’t know why people haven’t caught on to this yet.
Because with this, you can forget fearing this recession,
and use it to your advantage instead!

I’ll show you how, and it’ won’t cost you a cent.

But there IS a catch – we fill up early, and there’s no
wait list. And at last count, we only had 14 spots left.

Go and grab one of these last openings NOW, or miss out.
https://www2.gotomeeting.com/register/830662521

—-
President Barack Obama’s senior advisor assured the American public that the President has a “solid” housing plan that will stabilize housing prices and help prevent the tsunami of foreclosures that have come. Speaking on Fox News Sunday Alexrod said that the President would announce this coming Wednesday his plan that will start “raising home values that have been plummeting.” Axelrod said that the President’s plan will commit $50 to $100 billion to stem future foreclosures.

And the financial markets were closed this holiday, so instead of reviewing financial news that impacts real estate we’re going to provide you a quick overview of the Stimulus package in terms of the impact it will have on real estate investors and Realtors:

Homebuyer Tax Credit: The bill increases the $7,500 tax credit to first time homebuyers to a maximum of $8,000, but in a major change it does not require repayment of the $8,000. The credit is available to those with adjusted gross incomes or no more than $75,000 or $150,000 if married and phases out up to $95,000 and $170,000 if married. The definition of “first time” homebuyer is actually someone who hasn’t purchased a house in the last 3 years.

In an effort to assist with home stabilization, the bill will force a recapture of the entire $8,000 tax credit if they home is sold within 3 years of purchase.

FHA, Freddie Mac & Fannie Mae Loan Limits: The bill extends the increase in loan limits that were passed in 2008. The limits are 125% of the median home price for the local area for FHA and $417,000 for Fannie and Freddie. There are certain areas of the country where these limits are higher, however. For example, Ventura County, California has a limit of $729,750 for both FHA and Fannie & Freddie—the maximum cap allowed.

Neighborhood Stabilization: An additional $2 billion has been allocated to the Neighborhood Stabilization Program (NSP). This is an extension of the Community Development Block Grant whereby Realtors and investment groups can team with municipalities to purchase foreclosed homes in blighted areas and then resell them to families at or below 120% of the area median income, with 25% of the funds being used to families below 50% of the area income.

USDA: There’s another $500 million for the existing USDA Rural Housing program. That’s basically the only 100% program out there, so the extra half a billion sure will help get more people financed.

Now, on to our real estate investing section…

Confiscation of Wealth

Throughout history there have been those that learn how to preserve and even expand their wealth despite (or some may say because of) tough economic times while others merely persevere. The remaining masses find themselves growing ever less wealthy with each passing year through the confiscation of their hard earned wealth. Learn how short sales allow the average person to hold on to what they have earned by avoiding these common wealth confiscation culprits:

Taxes. You have heard the saying there is nothing certain in life except death and taxes. While it may be true that you cannot avoid paying taxes, it is perfectly acceptable to minimize the amount of taxes that you legally are required to pay. Consider this, if you work for a living, the harder you work the less you bring home – proportionately speaking. That is because labor is taxed at a higher rate than other forms of profit. Transfer the source of your cash flow and instantly save 10, 20 or even 30 percent on every additional dollar you make.
Inflation. As if taxes weren’t enough to grapple with, inflation is a slow force that steadily decreases the purchasing power of your dollar. As the government prints more and more money, it decreases the value of each original unit. Things like food, housing, raw materials and other basics become more expensive over time. Lest you think inflation doesn’t matter, consider this….the dollar has lost more than 90 percent of its purchasing power in the past 100 years. On the other hand, those who own tangible assets such as real estate are able to keep pace with the rate of inflation. It may go up or down for short periods of time, but eventually tangible assets always return to an inflation adjusted rate.
Savings. This may initially sound counter-intuitive; after all, you have probably been told to save money and put it into an interest bearing account in preparation for retirement or a rainy day. Unfortunately, saving money puts it at risk for the dual hardship of both taxes and inflation rather than putting it to work. Consider this, if you placed $100,000 into a savings account that always kept perfect pace with inflation you would still lose money once you paid the taxes on the earnings. Add in transaction costs, holding fees and other expenses to realize you are unlikely to ever break event. The only way to build wealth is to generate an excess above and beyond inflation, taxes, transaction fees and other associated costs…this means you must put your money to work. The most common method has been via debt or leverage. By using a low interest fixed rate loan you can minimize volatility and risk while maximizing your ability to increase long term returns.

Chris McLaughlin

http://www.shortsalesriches.com/welcome.html

P.S.

This weekend’s webinar replay is right here…

http://www.webinarwizards.com/custom/index.cfm?id=170879

P.P.S.:

Find out how a widowed ex-Marine left with 2 children figured out how to make it work with commercial real estate by clicking here:

https://commercial.infusionsoft.com/go/invite/a181/

http://www.shortsalescoach.com
http://www.shortsalesriches.com/welcome.html
http://www.youtube.com/shortsalesriches
*************************************************
Finally, a blog for Real Estate professionals
that want up-to-the-minute news, & how it impacts
us and our market…

http://www.shortsalesriches.com/blog
*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month

   * Long-time authority on real estate investing
      and rapid flipping of distressed homes. Owns
      portfolio of nearly 100 high-value, high-profit
     properties

     * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
     in Real Estate Investing, Entrepreneurship, and
      Wealth Building

—

{ 1 comment }

Info on the $8,000 First Time Homebuyer Tax Credit

by Chris McLaughlin on February 13, 2009

Real Estate News & Commentary by Chris McLaughlin, February 10, 2009
http://www.shortsalesriches.com/welcome.html

—-
“2 Careers That Boom in a Recession!”
I’ll tell you about one of these for fr*ee
in my no-charge, no-cost, no-obligation
webinar right here this Saturday at 3 PM ET:

https://www2.gotomeeting.com/register/899440029

Why would I do that for no charge? Because
I want a chance to tell you about the other
high-income opportunity, too.

And I can’t do it in an email.

But If you’re finally ready to blast out of
this economic mess, then get a move on… I’d
hate for you to miss out, because we always fill
up a day or so early. See if there’re any spots
left:

https://www2.gotomeeting.com/register/899440029
—-
There’s still a fair amount of confusion regarding the new home buyer tax credit, as the legislation isn’t final and the draft is still pending a final vote in Congress. As you know, I’m not happy about Congress’s wimpy $8,000 credit versus the $15,000 proposed, but something is better than nothing.

According to today’s Wall Street Journal, the tax credit is for first time home buyers only that are buying between April 2008 and June 2009. The credit is now nonrefundable. That means that the existing $7,500 credit is increased by $500 and no longer needs to be paid back as an interest free loan over 15 years, as was previously the case.

The National Association of Realtors provided a different window on effective dates, however. They indicate that the pending legislation is $8,000, but that it is for purchases made between January 1, 2009 to December 1, 2009. And if the home is resold within 3 years the credit must be recaptured on the sale of the property, but if it is held for more than 3 years it is nonrefundable.

In addition, the existing credit was ineligible for homeowners utilizing revenue bond financing. That provision, according to NAR, has been eliminated.

Stay tuned: once the legislation passes both the House and Senate we’ll have the final facts to you ASAP!

Now, on to our real estate investing section…

Short Sales Real Estate – The Perfect Baby Gift?

Grandparents or parents searching for the perfect baby gift should pass by those standard Savings Bonds and instead, turn to short sales for the perfect baby gift that is able to transform a life forever. Think this sounds a little “over the top”? Consider how real estate would have performed in the past by using these simple steps:

1. Purchase an affordable short sale home in a growing area or college town. Finance it for 15 to 20 years using a fixed interest mortgage.

2. Rent the home while the child is growing up. If you make money – consider it a big bonus or reinvest the extra to help pay tuition or other expenses.

3. Once the child is ready to begin college the home will be paid in full. College cost will be dramatically reduced since they do not need a dorm and can actually generate a small income by renting out rooms to other college students. Less work means more study time for your future student!

4. After college they can continue to rent for an even larger monthly profit, exchange the property for one closer to their new work location or sell the property to purchase their first family sized home…with a huge down payment and instant equity or perhaps even pay cash if desired.

5. If they continue to hold, the property will only increase in value while gaining greater appreciation over the years.

Now ask yourself…how would your life have been different without big student loan debt? Never having to worry about a roof over your head? A small rental income coming in every month? Enough money to purchase a great family home or even a retirement account in old age? You can provide this plus so much more simply by purchasing a short sale property with a 15 to 20 year mortgage on behalf of a special child.

It is hard to determine what the future may have in store for the younger generation although most experts agree, inflation is likely to make college less affordable than ever. As the federal government prints their way out of the current economic crisis, higher than average rates of inflation are likely to impact every area of life, resulting in severely limited futures for many young Americans.

On the other hand, even with low rates of inflation, the price of a home typically doubles or even triples every 20 years. Today’s ultra low priced short sale home could easily double or triple in value by the time your child begins college then double or triple again by the time they are in middle age. For example, a $100,000 home could easily be worth $200,000 by the time they start college – all paid in full! If inflation continued to creep along the same house could be worth $400,000 by the time they are in their 40’s and $800,000 by their early 60’s. This one gift could radically alter the rest of their productive life and even the lives of your great-grandchildren. So, buy a short sale house and place it into a trust to assure the financial future of that very special child in your life.

See you at the top!

Chris McLaughlin

http://www.shortsalesriches.com/welcome.html

P.S.

This week’s webinar replay is right here…

http://www.webinarwizards.com/custom/index.cfm?id=170879

http://www.shortsalesriches.com/blog
*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month

   * Long-time authority on real estate investing
      and rapid flipping of distressed homes. Owns
      portfolio of nearly 100 high-value, high-profit
     properties

     * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
     in Real Estate Investing, Entrepreneurship, and
      Wealth Building

—

{ 0 comments }

homebuyer tax credit

Bernanke Says Interest Rates to Stay Low

The Stimulus Package & Its Impact on Real Estate

Info on the $8,000 First Time Homebuyer Tax Credit

Follow Me on Twitter

Become a Fan