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uncle-samThe clock is ticking down for first time home buyers.  You need to act NOW to make sure that you don’t miss out on the $8,000 from Uncle Sam. 

Here is the fast, quick information you will need to see if you qualify for the $8,000 tax credit for first-time home buyers from The American Recovery and Reinvestment Act of 2009.

  • You must be a first time home buyer, defined as not owning a home in the past 3 tax years.
  • Tax credit amount is 10% of the sales price of the home up to a maximum of $8,000.
  • There is NO price limit on the sales price of home.
  • Maximum income to receive FULL tax credit is $75,000 for a single person, the limit for married couples is $150,000.
  • You can receive a PARTIAL tax credit for income levels up to $95,000 for a single person and $170,000 for married couples. 
  • There is no payback or penalty as long as you stay in home as your principal residence for 3 years.
  • You must CLOSE on your new home on or after January 1, 2009 or before December 1, 2009.   

***IMPORTANT:  Congress passes tax credit extension.  Must have binding sales contract dated on or before April 30, 2010 and close on or before June 30th, 2010. 

 

This is the quick & dirty information that you need right now for the $8,000 Tax credit.  For more detailed information you can go HERE.

It is a great time to be a home buyer.  This is the perfect time to by a home, especially 1st time home buyers, as long as your job is secure.  If you feel safe in your current employment/job, then there are just so many positive reasons to now buy a home.  Don’t miss the “gravy train!”

  • Buyer’s market
  • Really low mortgage interest rates
  • High inventory levels.  Plenty of home options
  • Depressed, low prices (buy low, sell high) 

Please contact me if you have more questions or need help.Throwing Money

IMPORTANT:  I’m just trying to help the “average Joe home owner” to understand the new $8,000 tax credit.  I have to put this” CYA” disclaimer in my post.  Please consult a tax professional or accountant for more details and eligibility questions regarding the $8,000 1st time home owner tax credit.  I’m not an accountant or tax professional.

 Good luck out there!

 Home Buyer Advocate Mike

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chinese-drywallThis is a follow up to my blog post on March 25th, “Toxic Drywall Could Be Largest Lawsuit In US History!”    This blog post produced record high amount of views and comments.  We really tapped into a very important topic for the consumer.

 The good news is that the Columbus Dispatch is reporting that it appears there is NO Chinese drywall in the Columbus, Ohio area.  The Columbus Dispatch did a thorough job of interviewing new home builders, home contractors, drywall suppliers and it appears that no toxic Chinese drywall made it to the Central Ohio area.

The Bad news is that the toxic Chinese drywall is definitely in the United States.  In 2005, Chinese manufacturers shipped 500 million pounds rotten-eggsof drywall mainly to southern gulf coast states of Florida, Louisiana & Texas.  Chinese drywall smells like “rotten eggs” and is being blamed for damaging furnaces and electrical wiring, tarnishing jewelry and possibly sickening families.  So the potential is still there for toxic Chinese drywall to be the largest lawsuit in US history.  Just be happy that it is not in our area.

Home Buyer Advocate Mike

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NAR Green Designation

NAR Green Designation

Congratulations to Andrew Show for being the only Exclusive (true) Buyer Broker in the State of Ohio that has obtained the  National Association of   andrew-showRealtors (NAR) GREEN certified designation. (NAR Green Council)

Consumer demand for real estate professionals that are GREEN knowledgeable is exploding.  More home buyers are requiring their Buyer Agents to understand Green building principles and the financial advantages of properties that are energy efficient and ecologically friendly to the environment. 

Again, Congratulations Andy!

Home Buyer Advocate Mike

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Small HouseA good story on WSYX-ABC 6 – “Six On Your Side” about toxic drywall from China.  M/I homes faces a lawsuit for possible toxic drywall.  This has the potential to be a HUGE local and nationwide story.

It seems like the story is really flying under the radar.  I wonder why this isn’t getting more media/press coverage?

M/I Homes is the largest new home-builder in Central Ohio. 

http://tinyurl.com/cmlyak

 (Watch Consumer Alert Story)

This lawsuit has the potential to be the largest class action home defect lawsuit in US History!

Stay tuned for future updates and opinions in blog.  A story this big could be a “game changer”!

Be careful out there.

Home Buyer Advocate Mike

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houseforsale1 IMPORTANT:  Blog post modification.  The source (Ohio Association of  Realtors-OAR) for this blog post was inaccurate.  I am sorry for the confusion.  OAR incorrectly stated that new changes will apply to all single family homes.  This is incorrect.  Changes on April 1st will apply only to condominiums and investment properties.  See previous blog post for more information:  https://mybuyerbrokerblog.com/2009/01/08/new-condominium-loan-guidelines-for-2009/ I am sorry for the confusion.

Wow, this is incredible new (bad) news.  It looks like the only good option for home buyer’s will probably be an FHA loan.  Fannie Mae and Freddie Mac are both toughening their credit score and down-payment rules as of April 1.

In response, major lenders are already factoring in the higher fees, which reduces the effectiveness of the stimulus efforts.

Under the new guidelines:

  • Buyers with down payments of less than 25 percent will be charged a three-quarter point add-on penalty, no matter how high their credit score
  • Buyers of duplexes, where one unit is owner-occupied and the other is rented, will be charged a 1 percent add-on
  • Refinancers who take cash out will be charged as much as three points if they have a low to moderate equity stake.

Freddie spokesman Brad German says the loan categories and credit risk combinations targeted by these fees “default at four-to-eight times” the rate of other mortgages backed by Freddie. “We have to manage these risks appropriately,” he says.*

Good luck out there!

Home Buyer Advocate Mike

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*This blog post referenced “Ohio Association of Realtors” email newsletter.

superman-logoIf you are looking for help to buy a home in Columbus, Ohio then you should contact a Buyer’s Agent.  But, not all Buyer’s Agents are the same.  The best representation for a residential or investor home buyer in Columbus, Ohio is an Exclusive Buyer Agent (EBA) or Exclusive Buyer Broker (EBB).  An Exclusive Buyer Agent will always look out for your best interest and protect you in the home buying process.

Here are the TOP 10 reasons to use an Exclusive Buyer Agent:

  1.  We ONLY represent buyers.  We are EXPERTS at buyer representation.
  2.  We negotiate the BEST price and terms for you.
  3.  We don’t sell homes.  We advise, counsel and educate.
  4.  We assist Buyers in evaluating the BEST financing options.
  5.  We have a duty to DISCLOSE all material information to our Buyer’s.
  6.  We are Buyer advocates that work to PROTECT your investment.
  7.  We are the GUARANTEED highest level of representation.
  8.  We SAVE you time and money.  We pay attention to the details.
  9.  We provide MORE available homes to our Buyer’s than most other  agents.
  10.  We locate, evaluate and negotiate for our Buyer’s.

For more information contact an Exclusive (true) Buyer Agent today. 

Helping home buyers is our only speciality.

A true Buyer’s Agent (EBA) will have no conflicts of interest….ever!superman-picture

An Exclusive Buyer Agent is NOT Superman.  But, we are the home buyers best protection and advocate in the home buying process.

Good luck out there.

Home Buyer Advocate Mike

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Treasury and FDIC

US Treasury and FDIC Bailout!

This past Summer, Congress passed a $300 billion housing bill to rescue Freddie Mac and Fannie Mae and to help thousands of homeowners avert foreclosure.

The housing bill should definitely help the volatile housing and financing markets. 

At the time, the housing bill was record breaking landmark legislation.  But, Oh my how much has changed in 2008:

 

Largest US bank failure – Washington Mutual, $307 billion in assets.

Federal Reserve intervenes to save investment bank giant “Bear Stearns”.  JP Morgan bank takes over Bear Stearns and receives $29 billion dollar loan from government.

IndyMac bank failure $32 billion in assets.

U.S. Government to take over failed AIG in $85 billion bailout.

In October, the new, largest government bailout in history to help US banks – $700 billion dollars.

There has been so much that has happened in the past 5-6 months that is easy to forget about one of the most beneficial aspects of the $300 billion bailout in July.  The $7,500 tax credit is a great benefit for 1st time home buyers.

Here is everything you need to know:

Eligibility:

  • Purchase a home between April 9, 2008 and June 30, 2009.
  • Must be a first time homeowner or haven’t owned a home in the last 3 years.
  • New home purchase must be your principle residence.
  • Maximum income requirements (Adjusted Gross Income) for full $7500 tax credit benefit is $75,000 for individuals and $150,000 for married couples.
  • Partial tax credit benefit eligible for adjusted gross incomes up to $95,000 for individuals and $170,000 for married couples (see phase out charts below)

  

  

Terms:

  • $7,500 tax credit is basically an interest free loan from Uncle Sam.
  • There is no application or approval process.
  • If you are eligible, you simply claim the tax credit when you do your 2008 or 2009 taxes (IRS form 1040).
  • Payment starts 2 years after you apply for the credit. 
  • Those qualifying for the full $7,500 tax credit will pay $500 once a year for 15 years.
  • If you receive less than the full credit your payment schedule will be 6.67% per year over 15 years.
  • Payment will be done via completing your federal tax return every year. 
  • You will owe nothing if you lose money on the sale of your home.  Also, regardless of the sale price, you will never have to pay money “out of your pocket”.   Here are 3 good examples that will better explain everything:
  1. Purchased a $200,000 home, sold 4 years later for $204,000.  At time of sale you still owed $6,500 on tax credit.  You would just have to pay $4,000.  The remaining $2,500 would be forgiven.
  2. Purchased a $200,000 home, sold 4 years later for $199,999.  At time of sale you still owed $6,500 on tax credit.  You lost money on your home purchase.  The entire remaining $6,500 balance would be forgiven.
  3. Purchased a $200,000 home, sold 4 years later for $225,000.  At time of sale you still owed $6,500 on tax credit.  You are responsible to pay the full $6,500 remaining balance.

Basic Q&A’s:

  • Are there restrictions on the location of the property?  Yes, property must be located in the United States.  Property outside the US is not eligible for the tax credit.
  • Are there restrictions related to the financing of the property?  Yes, if your financing is obtained via a mortgage revenue bond (example; a tax exempt bond related program from a state housing agency) then you will NOT be eligible for tax credit.
  • Are there any other types of financing restrictions?  No, all types of mortgage finance programs are eligible.  For example;  Conventional, FHA, VA, cash, sub-prime (boo hiss), non-conforming, etc.  Even cash purchases qualify as long as purchaser meets all other eligibility requirements listed above.
  • Are there minimum or maximum home purchase prices?  No, maximum home purchase price for tax credit.  Homes purchased under $75,000 will only receive 10% tax credit.  For example, Buyer purchases a $50,000 condo.  The maximum tax credit will be $5,000.
  • What types of housing qualifies for tax credit?  All types of home ownership qualifies.  For example, condos, co-ops, existing single family, new builds, manufactured homes, town homes, duplexes even houseboats!
  • What happens if I sell my home within 15 years?  You are not reading my post.  You are just “skimming” the article.  Review the last bullet point in terms section above.

I think the $7,500 tax credit is a great benefit for the first time homeowner.  If you meet eligibility requirements then you should really take advantage of this tax credit.

But, some home owners would say “What’s the big deal?  I still need to pay pay back the $7,500!”  I would tell you there are 2 very important things to consider:                                                            

Federal Bailout

Federal Bailout

  1. Basic economic principle called the “time value of money”.  Money now is more valuable than money in the future.  This principle is especially true now in this bad economy.  Cash is King!.  So, I guess my bachelors degree in Finance from the great Ohio State University was worthwhile.
  2. A tax credit is more valuable than a tax deduction.  A credit affects the tax amount you owe or refund amount dollar for dollar.  A tax deduction just reduces your adjusted income that is taxable.

IMPORTANT:  I’m just trying to help the “average Joe home owner” understand the $7,500 tax credit.  I have to put this CYA disclaimer in my post.  Please consult a tax professional for more details and eligibility questions regarding the $7,500 1st time home owner tax credit.  I’m not an accountant or tax professional.

Good luck out there

Home Buyer Advocate Mike

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In our market, a FROG in your house is actually a really good thing.  In real estate terms, a FROG means “family room over the garage” 

How many of you out there honestly knew what this abbreviation meant?  Many real estate agents & brokers don’t even know what a frog is?

Being able to decipher real estate abbreviations & terms has always been a funny, frustrating problem for many home buyers.

“Newer CC style home, 3BR, 1.5BA, WBFP, new A/C with a large FROG, no bsmt and only 209K” Can  anyone  please translate what I just typed here? heh, heh, heh.

Years ago, selling homes via classified ads in the back of newspapers and magazines was common place. But, now traditional real estate agents use other marketing venues, especially the Internet.  So, the good news is that heavy use of vague real estate terms, abbreviations and euphemisms in real estate marketing is on the decline.  But, abbreviations and euphemisms are still a problem in real estate that the homebuyer needs to be educated on. 

Before I give you more important information on this problem, take a quick second and review our award winning TV commercial (SOB) below about the abbreviation problems in real estate.

I hope you enjoyed our funny commercial. You can click here if you would like to view our entire TV commercial series.

Now, back to the important information that you need to know!  Our professional trade organization, “National Association of Exclusive Buyer Agents” (NAEBA) recently released an excellent home buyer informational report; “2008 Report on Home Buying Euphemisms and Lingo-How to read between the lines when you’re shopping for a home”

(you will need to have adobe software on your computer to view/print report.  Click here if you would like to download the free adobe reader)

For years, I’ve told my clients that you have to be able to read between the lines when you are looking for a home.  The information about the home on the main listing page usually has misleading descriptions.

For example:

Needs a little TLC or fixer upper…………really means the house is a dump and hasn’t been updated at all.

Cozy, cute home……………..really means the home is so small that it is difficult to turn around in. 

Great landscaping, beautiful yard……………..really means the house is a piece of crap, but the seller has to found something positive about their house.   

Damp basement in the spring…………really means we usually get 2-3 feet water in our basement once a year.

Sometimes sellers think minimizing problems in their listing descriptions, like, “damp basement” will protect them from getting sued for non-disclosure.  I don’t think so!

One last tidbit of information for you.  Many times in the listing description you will see the words “many updates” or “mechanical’s updated”.   The problem is how do you define recently “updated”.  My personal definition of “updated” is anything that has been done in the last 5 years.

You really have to be careful when you see a sellers and/or listing agents that uses “many updates” in the listing description.  I had one personal experience where a listing agent stated that the roof was recently updated.  After evaluating the home with my buyer client, It appeared to me that the roof had some prominent signs of aging (lost granuales, slight peeling/curling of roof shingles, etc.) and didn’t really look like the roof was recently updated.  I contacted the listing agent for additional information and/or paperwork on the roof.  The listing agent provided documentation that the roof was nearly 9 1/2 years old.

I asked the agent how they could describe a nearly 10 year old roof as recently updated.  The listing agent’s explanation was that the new roof’s expected life expectancy was somewhere between 20-25 years and since the roof was still less than “half old” that they felt they could list the roof as recently updated.

Geez, are you kidding me! So again, be very careful when you see these words.  You always want to make sure you have a full home inspection completed by a qualifed home inspector.  Your Buyer Broker should also always ask for copies of receipts and/or invoices of any recent updates.

These are just a few of the funny, informative listing descriptions that you will find in the “Home Buying Euphemisms and Lingo report”.  There are 50+ listing descpritions in this report that will help you understand the lingo when review listing information.  But, remember your best protection is to have an Exclusive (True) Buyer Broker representing you.

If you thought this blog post was helpful, then you should also check out the “Problem With Staging Homes” blog post.  Both articles deal with the same general topic. 

Home Buyer Advocate Mike

Representing People, NOT Property!

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Last week there was a great article in the Columbus Dispatch newspaper, “Independent Title Agents Sue”.  A group of small, independent title agents is petitioning the Ohio Supreme Court to STOP real estate brokers, banks, mortgage companies from steering business to affiliated title companies.

In a nutshell, the independent title agents are suing the Ohio Department of Insurance for failure to protect the consumer and to enforce state laws against what it calls “the spread of kickbacks and referral schemes in the real estate industry” (aka, affiliated business relationships).

Good news, Ohio law prohibits banks, real estate brokers and mortgage companies from being licensed title agencies.  But, since 1974 the federal Real Estate Settlement Procedures Act (RESPA) has allowed affiliated business relationships.  In my opinion, overall RESPA has been great legislation that has helped protect the consumer.  But, RESPA really dropped the ball in regards to affiliated business relationships.

Let’s hope the independent title agents will be successful with their lawsuit.  I will keep you updated with future blog posts.  “Affiliated business relationships” are really bad for the consumer.  These relationships raise the cost of many title company fees with no benefits to the consumer.

In my opinion, if this lawsuit wins it could really open an “ugly door” into our state departments and agencies that are set up to monitor and regulate many industries, such as real estate, lending, financial securities and insurance.

The “average Joe citizen” would think these agencies are set up to protect the consumer.  But, in many times, the actions and decisions of these agencies have worked to protect the industry that they are monitoring more so than protecting the consumer.

We have been mixing “big business industry” with politics for years.  This has fostered an environment of “sleeping with the enemy” and/or “the fox is guarding the chicken coop”.

This is a dangerous mix of power, control and greed that has been dormant for a long time.  If this lawsuit is successful, hopefully it will expose other agencies and open up a lot more questions.

If you can’t tell by now, I am no proponent of “one stop shopping”.  The problems of affiliated business agreements are just a smaller component of the entire “one stop shopping” farce.

There is only ONE reason why big banks, insurance companies and/or real estate firms offer you the convenience of one stop shopping and that is profit and greed.  It will almost never be in your best interest to make a major financial decision on one stop shopping.

If you need to buy or sell a home in Central Ohio and you are thinking about using the largest real estate broker in our market to help with everything (real estate transaction, new loan, home warranty, title services, etc.) then you need to be really careful.  As Dr. Phil would say, “You need to get REAL” (or not real, if you know what I mean).

You need to do research and work to be a smart, informed consumer.  Shop around, make phone calls, get multiple estimates or quotes.  If you do your research you will make the best informed decision and you will be better off financially.

In my opinion, there has always been a public perception that the real estate industry has been notorious for kickback schemes and unethical referral arrangements.  Eliminating or better monitoring of affiliated business relationships/agreements will be a good start toward improving our public perception.  Let’s hope the Ohio Supreme Court can do the right thing! 

After we fix affiliated business relationships we will move onto stopping one stop shopping. heh, heh, heh!

Here are some related links:

Ohio Department of Insurance

Ohio Department of Commerce (Real Estate, Mortgage & Financial Securities)

Division of Financial Institutions

Division of Real Estate

Division of Securities

Be careful out there!

Home Buyer Advocate Mike

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Not Really!…..But I made you take a second to review our informative blog.  The Homebuyer’s Advocate Blog could possibly be the best real estate blog in central Ohio.  But that is for our subscribers & readers to comment on, NOT us.  I’m playfully breaking one of the most important commandments of blogging.

Rule #1 of blogging, thou shall not blatantly self-promote. 

10,000 Views

10,000 Views!!!

In the last year, hopefully our readers & subscribers feel the Homebuyers Advocate has been an excellent resource for EVERYTHING real estate in Columbus, Ohio.  We had a goal of reaching 10,000 views within the first year.  We came extremely close to our goal.  But, we fell short by only 13 days.  Our new goal for next year is 50,000 views by the end of year two.

We’ve had some good exposure in the last year.   Homebuyer’s Advocate Blog was used as a reference for a Columbus Dispatch news article in May, 2008.  Andrew Show, Owner of Buyer’s Resource Realty Services was a guest speaker on WTVN 610 radio station.  Our most popular blog post on home warranties was recently used as a reference in the current issue (September, 2008) of national magazine publication, This Old House Magazine”.

Our mission statement for The Homebuyer’s Advocate Blog is to be the premier information resource for home owners in central Ohio with a primary focus on saving home owners money or preserving their equity/appreciation. 

If you are a home owner or potential home owner in Central Ohio our blog is a growing database of important news and information that you need to be aware of. 

If you take a second to review a few of our 37 blog posts, I bet you will find some information that will save you some money.

Good luck out there!

Be Informed, Subscribe NOW!

Home Buyer Advocate Mike

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Buyer's Resource Realty Services 7100 N. High St. Suite 204 Worthington, OH 43085
614.321.9577

Michael Marshall – Angie’s List Super Service Award 2013!

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HomeBuyer Advocate Mike


Representing People, NOT Property in Columbus, Ohio. If you are a home buyer, then you need me to protect you. I can help you get the best price and terms for your next home purchase. You must use a true Buyer Broker! 1.614.805.7607

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