What kind of credit score do I need to qualify?

■ The lender will require a minimum of 640 middle score from each of the 3 credit rating bureaus.

 What payment history do I need to show the lender?

■ The lender will require the most recent 12 month payment history showing no 30 day late payments whether by renting or owning a house.

 What if I have had a bankruptcy in the past?

■ You can purchase a home if the bankruptcy has been dissolved within a 24 month period or a 36 month period if a previous home was in a bankruptcy.

  Is an FHA loan just for first time homebuyers?

■ No, this is a government secured loan by the Federal Housing Administration available for any buyer. Keep in mind they have maximum loan amounts per your county.

 What kind of down payment is required for a loan?

■ Buyers need a minimum or 3.5% to secure a loan, the funds of which can be gifted from a family member, employer or any other approved institution.

 Do I need a job to qualify?

■ You must have a continued source of income for 2 years or more whether it's from your employer, social security, disability, child support or other sources.

 What if I have bad credit?

■ Don't despair because there are credit agencies out there that specialize in getting your scores where they need to be within 30-60 days so you can buy your future home. Ask your realtor or loan officer for a recommendation.

 How much can I afford?

■ This requires more of a pre-approval process in which you work with your loan officer and realtor to see the best scenario for you after some basic factors such as credit and income are reviewed.

This Billboard is posted on the corner of Smith and Williams by Rookwood Commons in Hyde Park area as you approach 71 South. The Billboard will be up until the first week of January for the Christmas Season.

Merry Christmas and Thanks for your Support!!!

Kevin Geraci

As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed new legislation that:

• Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time home buyers until April 30, 2010.
• Expands the credit to grant up to $6,500 credit to current home owners purchasing a new or existing home between November 7, 2009 and April 30, 2010.

Here is more information about how the Extended Home Buyer Tax Credit can help prospective home buyers become part of the American dream. If you have specific questions or need additional information, please contact a tax professional or the Internal Revenue Service at 800-829-1040.

Latest news:
Home Buyer Tax Credit Has Added Benefits for Armed Services Members, Others (Nov.11)
Tax Credit Extension a Positive Step Toward Real Estate Recovery (Nov.5)
President's Podcast: Tax Credit Extended (Nov. 5) 

Who Qualifies for the Extended Credit?

• First-time home buyers who purchase homes between November 7, 2009 and April 30, 2010.
• Current home owners purchasing a home between November 7, 2009 and April 30, 2010, who have used the home being sold or vacated as a principal residence for five consecutive years within the last eight.

To qualify as a “first-time home buyer” the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase.

If you or your client purchased a home between January 1, 2009 and November 6, 2009, please see: 2009 First-Time Home Buyer Tax Credit.

Which Properties Are Eligible?

The Extended Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops.

How Much Is Available?

The maximum allowable credit for first-time home buyers is $8,000.

The maximum allowable credit for current homeowners is $6,500.

How is a Buyer's Credit Amount Determined?

Each home buyer’s tax credit is determined by tow additional factors:

1. The price of the home.
2. The buyer's income.

Price

Under the Extended Home Buyer Tax Credit, credit may only be awarded on homes purchased for $800,000 or less.

Buyer Income

Under the Extended Home Buyer Tax Credit, which is effective on November 7, 2009,  single buyers with incomes up to $125,000 and married couples with incomes up to $225,000—may receive the maximum tax credit.

These income limits have changed from the 2009 First-Time Home Buyer Tax Credit limits. If you or your client purchased a home between January 1, 2009 and November 6, 2009, please see 2009 First-Time Home Buyer Tax Credit.

If the Buyer(s)’ Income Exceeds These Limits, Can He/She Still Get a Credit?

Yes, some buyers may still be eligible for the credit.

The credit decreases for buyers who earn between $125,000 and $145,000 for single buyers and between $225,000 and $245,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limit. Home buyers earning more than the maximum qualifying income—over $145,000 for singles and over $245,000 for couples are not eligible for the credit.

Can a Buyer Still Qualify If He/She Closes After April 30, 2010?

Under the Extended Home Buyer Tax Credit, as long as a written binding contract to purchase is in effect on April 30, 2010, the purchaser will have until July 1, 2010 to close.

Will the Tax Credit Need to Be Repaid?

No. The buyer does not need to repay the tax credit, if he/she occupies the home for three years or more. However, if the property is sold during this three-year period, the full amount credit will be recouped on the sale.

Part of NAR's Right Tools, Right Now Initiative
Resources to help you better understand and promote the value of the Home Buyer Tax Credit to consumers are available for FREE or AT COST as part of NAR's Right Tools, Right Now initiative.

Source: National Association of REALTORS®

Source: Consumer Reports

When the leaves start falling, you know that the heating bills are about to start rising. But keeping your home warm and cozy in chilly weather doesn't have to break the bank.

The U.S. Department of Energy offers these simple tips and relatively inexpensive home improvements that will help ensure cold gusts stay out and your furnace doesn't have to work harder than it should.

The goal: Conserve energy and keep more of your hard-earned dollars in your pocket.

Share these ideas with customers and use them for your own house. After all, who doesn't need to save a little money these days?

1. Plug air leaks with caulking, sealing, or weather stripping. Save 10 percent ($190 per year) or more on energy bills. Focus on windows, doors, outlets or switch plates on exterior walls.

2. Properly maintain the heating system. Heating accounts for half the average family's energy bill (approximately $950 per year). Make sure the furnace or heat pump receives professional maintenance each year. The small cost (about $75-100 for most service calls) will pay back in better performance all year long.

3. Install a programmable thermostat. Programming the thermostat from 72ºF to 65ºF for eight hours a day while no one is home, or everyone is tucked in bed, will cut the heating bill up to 10 percent ($90 per year), paying for a basic unit in less than a year.

4. Seal and insulate heating ducts. A system can lose up to 60 percent of its warmed air before it reaches the register (wasting $570 in warmed air per year) if ducts are not properly insulated in unheated areas such as attics and crawlspaces.

5. Insulate, insulate, insulate. Adequate insulation in the attic, ceilings, exterior and basement walls, floors, and crawlspaces can save up to 30 percent on home energy bills ($630 per year).  Focus on the attic. (Heat rises.) Most homes should have between R-30 and R-49 insulation in the attic. Learn more atwww.eere.energy.gov/consumer.  

6. Close fireplace dampers when not in use.  When in use, reduce heat loss by opening dampers in the bottom of the firebox (if provided) or open the nearest window about an inch, close doors to the room, and lower thermostat setting to 50-55ºF.

7. Let the sun shine in. Open curtains on south facing windows during the day to allow sunlight to naturally heat the home, and close them at night to reduce the chill from cold windows.

8. Stay out of hot water. Water heating accounts for 15 percent of household energy use. Reduce water heating costs by lowering the water heater’s thermostat setting. Each 10ºF reduction can save between 3-5 percent in energy costs. Also insulate the hot water heater and hot water pipes.

9. Install storm windows over single-pane windows or replace them with Energy Star qualified windows. Storm windows reduce heat loss by 25 to 50 percent, and storm windows with low-e coating that reflect heat back into the room during the winter months save even more energy.  Look for the Energy Star label to maximize savings. Energy Star qualified windows reduce heating and cooling bills by an average of $345, but could be higher in cold and hot climates, compared with uncoated, single-pane windows. Can’t afford new windows just now? Tape clear plastic sheeting to the inside of window frames if drafts, water condensation, or frost are present.

10. Net big savings with a little label. When replacing appliances, light bulbs, electronics, or heating and cooling systems, cut energy bills by up to 30 percent ($600 per year) with Energy Star labeled products. Use compact fluorescent light bulbs (CFLs) in place of comparable incandescent bulbs. Find retailers atwww.energystar.gov.

These and other improvements that impact the energy efficiency of a home can save home owners money in the short term and serve as a selling point to potential buyers later. Be sure to save receipts, documentation, and manufacturer’s information.

Not sure where to begin? Try the Department of Energy's online energy audit tool at www.hes.lbl.gov. In the long run, a whole-house energy audit is a fool proof way to make a plan to address wasted energy and make a home operate efficiently for years to come. Visit www.natresnet.org to find a qualified auditor in your neck of the woods.

Source: National Association of REALTORS

A federal mortgage interest buy-down program would help spark the housing market, the National Association of Realtors® said in a letter sent today to James B. Lockhart, chairman of the Oversight Board of the Federal Housing Finance Agency. NAR seeks a 4.5 percent mortgage interest rate buy-down program financed through the U.S. Treasury Department’s Troubled Asset Relief Program.

In the letter to FHFA, NAR shared three potential implementation procedures for a federal buy-down plan:

• TARP would fund the payment of points at the individual level.
• The Federal Home Loan Banks would raise funds by selling below-market-rate bonds to the Treasury Department for them to make the 4.5 percent interest rates available to lenders.
• Fannie Mae and Freddie Mac would purchase mortgages at the 4.5 percent interest rate but pay lenders the market rate.

“The buy-down program would complement other initiatives and help stabilize, stimulate and revitalize the housing market,” said NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage in Dallas-Fort Worth. “We must address the foreclosure crisis and increase housing demand. Lower interest rates and foreclosure mitigation are two sides of the same coin. Together they represent the key ingredients to stabilizing the housing market and preserving communities and homeownership.”

NAR has calculated that a 1 percentage-point decrease in mortgage rates would result in an additional 500,000 home sales.

In addition to suggesting that TARP assets be used to buy-down mortgage interest rates, NAR has recommended other principles that would help create long-term stability by ensuring that safe and affordable mortgages are available throughout the nation:

• The higher loan limits passed in the economic stimulus bill earlier this year should be made permanent.
• The federal government should ensure sufficient capital to support mortgage lending in every type of market.
• The temporary $7,500 tax credit for first-time home buyers should be extended to all home buyers and the repayment requirement eliminated.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries.

Source: National Association of REALTORS

Related Links Sample Letters and Phone Scripts It's happening to more and more of us in today's troubled economy: You receive a threatening call or letter saying you owe money. And if you do nothing... The calls get more frequent, and more nasty to the point of harassment. Are they allowed to do this? And how can you stop them? More and More Receiving Calls The calls come at all hours of the night....and people say messages like the following are crossing the line. "I am like right now climbing into your family background. I am going to dig up so deep." Every week, I hear from viewers fending off debt collectors. Denise is a law abiding Cincinnati-area mom. But she tells me one day "I got a letter claiming I owed someone 550 dollars." Mike is a Northern Kentucky businessman who tells me he's never fallen behind either. But, says, "I got a call claiming I owed some bill." More Aggressive than Ever Attorney Billy Boward has filed dozens of lawsuits against debt collectors, for using what he claims are harrassing or abusive methods. Among them: Calls like this one, allegedly on behalf of the car-seller JD Byrider, and one of its Florida locations. "Now I am going to have to take it to a different level...." This message was left for a woman who was late on her car payment. "I'm going to turn it up a notch. I'm going to have to put this car on TV as being missing, which I can do. I can go on cable and do that. It's going to embarrass the daylights out of you. It's going to embarrass the daylights out of your mom. And I think you've got kids, too, if I'm not mistaken." One of Billy Howard's lawsuits was filed on behalf of Dane McLeod, whose husband Stanley was behind on the mortgage. Stanley explained he had heart problems and had to be rushed to a hospital by helicopter. The collector's alleged response? "Stanley McLeod you need to call Greentree and get your act together and make a payment on your mortgage. Quit playing games. Why don't you have that helicopter pick you up and bring that payment to the office." 4 months later, Stanley was dead. Know Your Rights So what are your rights? Consumer advocates say debt collectors: Can't harrass or lie. Can't present themselves as attorneys. Can't call before 8am or after 9pm, unless you agree. Can't call you once you write, telling them to stop. And thats the key: Sending them a letter, certified mail. One website -- Fair-Debt-Collection.com -- has sample phone scripts and letters for you to use, if a collector calls you (click above). If you dont take action, you can end up like Kelly Cassidy.... in tears.  Kelly says "All I can do is try to correct them...And its hard to do when its someone who doesn't care. That's how I feel!" Postcript A spokesman for "Greentree Servicing" says they don't comment on pending lawsuits. JD Byrder would not make any comment either. Byrider franchises in Ohio are not involved in this case. You can find out more about your rights -- including a link to that helpful website --regarding debt collection by clicking the link above...so you don't waste your money. I'm John Matarese.

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Source: Consumer Reports

• You will likely come across dozens of properties in foreclosure with little or no equity, that is, the seller owes at close to or more than the property is worth. In these situations, lenders are sometimes willing to accept less than the full amount due, commonly referred to a "short pay" or "short sale."
  
  Negotiating a short sale with the lender is a difficult process, generally because it is a daunting task finding a bank officer who has the authority to accept a discount. You will have to call around to locate the lender’s “Loss Mitigation Department.” More than likely, each lender you deal with will have a separate name for this department, so be patient when calling. Much like getting your phone bill corrected, you can expect the process to involve a lot of waiting on hold and being bounced around an intricate maze of automated voice mail systems. Once you get in touch with the right person, then the negotiating begins.
  
  Now mind you if you are doing this for yourself (you as the investor), you do not need a license. But if you are trying to do it for others, you will need a license. Also consider investing with other real estate ventures as defined in the book below.

The current buyer's market has left many people that are selling their home wondering what on earth
they need to do to get their home sold.  With so many homes on the market today, there are a few keys
to getting your home sold at a reasonable price.

What many home sellers don't understand is that the longer their home is on the market, the less money they
will get for it when it finally does sell. "Days on the market" is a very important questions many buyer's
look at.  If your home is on the market for let's say, 200 days, a buyer may start to wonder what it is
about your home that makes people not want to buy it.

The number one reason a home doesn't sell is price.  That all-to-sensitive number that everyone is
looking at.  It's the number that determines what home a buyer will buy and ultimately how much
money you will make when you sell.  All Realtor's have the same access to the multiple listing service
in order to form what they call a CMA (Comparable Market Analysis).  That is, seeing what is
comparable to your home in the area and seeing what has sold in the last 6 months.  That is how a
a Realtor can help you make the right choice of what price to list your home at.  With so many homes
on the market today, $5000 can truly make the difference if your home sells or not. Houses
are kind of like stock, hopefully they go up in value, BUT, sometimes they go down.  Bottom line is that your
home is worth what today's market says it's worth, regardless of what it was worth three, five or ten years ago.

Listen to what Realtors that have shown your home have to say about it.  If the showing Realtor comments
on improvements that need to be done, have them done as quickly and professionally as possible. (Promising you
will do it if they write an offer or telling them you will give them an allowance to get it done just gives that
buyer one more reason to just look elsewhere.)  If the Realtor says the carpets are stained or the walls
are too many colors, paint or re-carpet.  Would you really want to take the chance that the only reason that buyer
didn't buy your home was because you had a crazy obsession with the color purple and shag green carpet?
Many times the showing Realtor is really giving you helpful hints as to why your home is not selling.

Another reason your home doesn't sell is passing on showings.  If someone want to see your home at 8pm
by all means, let them.  Buyer's are few and far between but there are thousands of homes on the market.
If they can't see your home when they want to see it, chances are, they will pass and just look at other
homes that are available when they are. Ease of showing is also a valid point.  Does your home show well?
You must think like a buyer.  Your home must be clutter free and clean.  A buyer should be able to move
into your house without doing a thing. (This includes, cleaning the carpets, patching walls!)
Bottom line, NEVER pass on a showing. 

Lastly, when in doubt, lower the price.  That almost guarantees at least a couple of showings.  Also, talk
to your Realtor about how much you should lower the price.  Dropping it $1000 really isn't that big of a jump.
Here, I'll give you an example: Let's say a buyer is buying up to $125,000.  Your home is listed at $127,000.
You then decide to drop your price to $126,000.  You would be better off to drop it to $124,900.  That will
capture the buyers that are buying up to $125,000.  It's always best to drop it to the nearest 5, or 10
thousand dollar mark.  Well, I hope this blog helps you sell your home.  Good Luck!

-While it's true that the median price of an existing single-family home actually did drop by 1.8 percent from 2006 to 2007, it's important to put this into context.  Over the previous six years--the typical length of time an owner stays in one home--the median price has risen nearly 40 percent.  Those owners gave back just about 2 percent of that gain--leaving them with a very handsome appreciation rate.
 
-Mortgage interest rates today are hovering around 6 percent--about the same as they were 45 years ago.  Interest rates on both fixed-rate and adjustable-rate mortgages have been trending down.  Falling rates do not portend a recession.

-Interest rates on jumbo loans, however, (those over the Fannie Mae and Freddie Mac loan limit) remain well above the conventional mortgage rates.  Therefore, it isn't surprising that the share of single-family homes selling for more that $500,000 (many of which rely on jumbo loans) fell to 12.4 percent of transactions in December 2007 from 14.2 percent a year earlier.  This could also account for some of the drop in the median price last year. 

-Low mortgage rates trump the job market during recessions.  The last recession was in 2001 and the Fed was cutting rates and mortgage rates were falling. Homes sales then began to rise strongly. 

-Past deep housing recessions were accompanied by prolonged job losses and rising interest rates.  We have falling interest rates today.

-The economy added about 4 million jobs over the last two years.  Household formation is about half of what it should be given the employment growth, which indicates that many buyers are sidelined right now. 

-When the housing market begins to recover, this usually signals the start of an economic recovery. 

-Today's low interest rates will lessen the pressure on foreclosures.  Rising affordability assures higher home sales and home prices.  Furthermore, low rates lessen the burden on existing homeowners with ARMS because the resets are not as financially painful.

-The bottom line--We have historically low interest rates and we will likely avoid recession (but the economic expansion will be slow in 2008).  The high interest rates that have characterized past recessions are nowhere in sight.

Source:  National Association of REALTORS

2.) Clean out the clutter.  Open spaces look best.  Clean, and clean some more to make a good first impression. 

3.) Make any improvements that will improve the show of your home.  When possible, stick with the simpler (and less expensive) options to be sure the buying price covers your investment. 

4.) Know the fair market value of your home.  Your REALTOR can help assess the cost.  You may also want to have the home appraised.

5.) A REALTOR can help you objectively set the price so that it reflects the value of your home and the trends of the surrounding community.

6.) Are you set on your price, or eager to move?   How low are you willing to go? 

7.) Get pre-approved for your next move.  If you're looking to buy make sure you know your financial situation. 

8.) Commission, ad costs, attorney fees, taxes and prorated costs may all come into play.  REALTORS deal with transactions every day and can give you estimated costs. 

9.) Clean windows, open curtains, turn on lights and display fresh flowers.  A bright house is welcoming.

10.) Be ready and willing to have your home shown any day, even with short notice.  Making it difficult to see will also make it difficult to sell.

2. Money matters. If you're considering a mortgage, shore up your credit and get a copy of your credit report.

3. Get pre-approved and save yourself the time and grief of looking at houses you can't afford.

4. Determine how large your mortgage can be. Explore different loan options to determine what is best for you.

5. Decide what (and where) you want to buy. Prioritize your needs (i.e.,location, schools, amenities).

6. Consider your re-sell value. Even if you don't have school-aged kids, a strong school district is a good thing.

7. Do your homework. Bid based on sales trends of similar homes in the neighborhood.

8. Calculate the hidden costs such as property taxes, insurance, maintenance and association fees.

9. Don't be house poor. Double and triple check to be sure you haven't maxed yourself out on the cost of your home.

10. Hiring a Realtor to get the most for your money. It pays to have someone looking out for your interests.