Frewquently Asked Questions About The Homebuyer Tax Credit

Frequently Asked Questions About the Move-Up/Repeat Home Buyer Tax CreditThe Worker, Homeownership, and Business Assistance Act of 2009 has established a tax credit of up to $6,500 for qualified move-up/repeat home buyers (existing home owners) purchasing a principal residence after November 6, 2009 and on or before April 30, 2010 (or purchased by June 30, 2010 with a binding sales contract signed by April 30, 2010).The following questions and answers provide basic information about the tax credit. If you have more specific questions, we strongly encourage you to consult a qualified tax advisor or legal professional about your unique situation. Who is eligible to claim the $6,500 tax credit? What is the definition of a move-up or repeat home buyer? How is the amount of the tax credit determined? Are there any income limits for claiming the tax credit? What is “modified adjusted gross income”? If my modified adjusted gross income (MAGI) is above the limit, do I qualify for any tax credit? Can you give me an example of how the partial tax credit is determined? How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008? How is this different than the rules established in early 2009? How do I claim the tax credit? Do I need to complete a form or application? Are there documentation requirements? What types of homes will qualify for the tax credit? I read that the tax credit is “refundable.” What does that mean? Instead of buying a new home from a home builder, I hired a contractor to construct a home on a lot that I already own. Do I still qualify for the tax credit? Can I claim the tax credit if I finance the purchase of my home under a mortgage revenue bond (MRB) program? I am not a U.S. citizen. Can I claim the tax credit? Is a tax credit the same as a tax deduction? Is there a way for a home buyer to access the money allocable to the credit sooner than waiting to file their 2009 or 2010 tax return? HUD allows “monetization” of the tax credit. What does that mean? If I’m qualified for the tax credit and buy a home in 2009 (or 2010), can I apply the tax credit against my 2008 (or 2009) tax return? For a home purchase in 2009 or 2010, can I choose whether to treat the purchase as occurring in the prior or present year, depending on in which year my credit amount is the largest? Who is eligible to claim the $6,500 tax credit? Qualified move-up or repeat home buyers purchasing any kind of home are eligible to claim this credit. What is the definition of a move-up or repeat home buyer? The law defines a tax credit qualified move-up home buyer (“long-time resident”) as a home owner who has owned and resided in a home for at least five consecutive years of the eight years prior to the purchase date. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse. Repeat home buyers do not have to purchase a home that is more expensive than their previous home to qualify for the tax credit. How is the amount of the tax credit determined? The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $6,500. Purchases of homes priced above $800,000 are not eligible for the tax credit. Are there any income limits for claiming the tax credit? Yes. The income limit for single taxpayers is $125,000; the limit is $225,000 for married taxpayers filing a joint return. The tax credit amount is reduced for buyers with a modified adjusted gross income (MAGI) above those limits. The phaseout range for the tax credit program is equal to $20,000. That is, the tax credit amount is reduced to zero for taxpayers with MAGI of more than $145,000 (single) or $245,000 (married) and is reduced proportionally for taxpayers with MAGIs between these amounts. What is “modified adjusted gross income”? Modified adjusted gross income or MAGI is defined by the IRS. To find it, a taxpayer must first determine “adjusted gross income” or AGI. AGI is total income for a year minus certain deductions (known as “adjustments” or “above-the-line deductions”), but before itemized deductions from Schedule A or personal exemptions are subtracted. On Forms 1040 and 1040A, AGI is the last number on page 1 and the first number on page 2 of the form. For Form 1040-EZ, AGI appears on line 4 (as of 2007). Note that AGI includes all forms of income including wages, salaries, interest income, dividends and capital gains.To determine modified adjusted gross income (MAGI), add to AGI certain amounts of foreign-earned income. See IRS Form 5405 for more details. If my modified adjusted gross income (MAGI) is above the limit, do I qualify for any tax credit? Possibly. It depends on your income. Partial credits of less than $6,500 are available for some taxpayers whose MAGI exceeds the phaseout limits. Can you give me an example of how the partial tax credit is determined? Just as an example, assume that a married couple has a modified adjusted gross income of $235,000. The applicable phaseout to qualify for the tax credit is $225,000, and the couple is $10,000 over this amount. Dividing $10,000 by the phaseout range of $20,000 yields 0.5. When you subtract 0.5 from 1.0, the result is 0.5. To determine the amount of the partial first-time home buyer tax credit that is available to this couple, multiply $6,500 by 0.5. The result is $3,250.Here’s another example: assume that an individual home buyer has a modified adjusted gross income of $138,000. The buyer’s income exceeds $125,000 by $13,000. Dividing $13,000 by the phaseout range of $20,000 yields 0.65. When you subtract 0.65 from 1.0, the result is 0.35. Multiplying $6,500 by 0.35 shows that the buyer is eligible for a partial tax credit of $2,275.Please remember that these examples are intended to provide a general idea of how the tax credit might be applied in different circumstances. You should always consult your tax advisor for information relating to your specific circumstances. How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008? How is this different than the rules established in early 2009? The previous tax credits applied only to first-time home buyers and were for different amounts of money. How do I claim the tax credit? Do I need to complete a form or application? Are there documentation requirements? You claim the tax credit on your federal income tax return. Specifically, home buyers should complete IRS Form 5405 to determine their tax credit amount, and then claim this amount on line 67 of the 1040 income tax form for 2009 returns (line 69 of the 1040 income tax form for 2008 returns).No other applications are required, and no pre-approval is necessary. However, you will want to be sure that you qualify for the credit under the income limits and repeat home buyer tests. Note that you cannot claim the credit on Form 5405 for an intended purchase for some future date; it must be a completed purchase. Home buyers must attach a copy of their HUD-1 settlement form (closing statement) to Form 5405 as proof of the completed home purchase. What types of homes will qualify for the tax credit? Any home that will be used as a principal residence will qualify for the credit, provided the home is purchased for a price less than or equal to $800,000. This includes single-family detached homes, attached homes like townhouses and condominiums, manufactured homes (also known as mobile homes) and houseboats. The definition of principal residence is identical to the one used to determine whether you may qualify for the $250,000 / $500,000 capital gain tax exclusion for principal residences.It is important to note that you cannot purchase a home from, among other family members, your ancestors (parents, grandparents, etc.), your lineal descendants (children, grandchildren, etc.) or your spouse or your spouse’s family members. Please consult with your tax advisor for more information. Also see IRS Form 5405. I read that the tax credit is “refundable.” What does that mean? The fact that the credit is refundable means that the home buyer credit can be claimed even if the taxpayer has little or no federal income tax liability to offset. Typically this involves the government sending the taxpayer a check for a portion or even all of the amount of the refundable tax credit.For example, if a qualified home buyer expected, notwithstanding the tax credit, federal income tax liability of $5,000 and had tax withholding of $4,000 for the year, then without the tax credit the taxpayer would owe the IRS $1,000 on April 15th. Suppose now that the taxpayer qualified for the $6,500 home buyer tax credit. As a result, the taxpayer would receive a check for $5,500 ($6,500 minus the $1,000 owed). Instead of buying a new home from a home builder, I hired a contractor to construct a home on a lot that I already own. Do I still qualify for the tax credit? Yes. For the purposes of the home buyer tax credit, a principal residence that is constructed by the home owner is treated by the tax code as having been “purchased” on the date the owner first occupies the house. In this situation, the date of first occupancy must be after November 6, 2009 and on or before April 30, 2010 (or by June 30, 2010, provided a binding sales contract was in force by April 30, 2010).In contrast, for newly-constructed homes bought from a home builder, eligibility for the tax credit is determined by the settlement date. Be sure to check with a tax advisor in cases where a HUD-1 form is not used at settlement to be sure you have sufficient documentation to attach to IRS Form 5405. Can I claim the tax credit if I finance the purchase of my home under a mortgage revenue bond (MRB) program? Yes. The tax credit can be combined with an MRB home buyer program. I am not a U.S. citizen. Can I claim the tax credit? Perhaps. Anyone who is not a nonresident alien (as defined by the IRS) and who has owned and resided in a principal residence in the United States for at least five consecutive years of the eight years prior to the purchase date can claim the tax credit if they meet the income limits. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse. The IRS provides a definition of “nonresident alien” in IRS Publication 519. Is a tax credit the same as a tax deduction? No. A tax credit is a dollar-for-dollar reduction in what the taxpayer owes. That means that a taxpayer who owes $6,500 in income taxes and who receives an $6,500 tax credit would owe nothing to the IRS.A tax deduction is subtracted from the amount of income that is taxed. Using the same example, assume the taxpayer is in the 15 percent tax bracket and owes $6,500 in income taxes. If the taxpayer receives a $6,500 deduction, the taxpayer’s tax liability would be reduced by $975 (15 percent of $6,500), or lowered from $6,500 to $5,525. Is there a way for a home buyer to access the money allocable to the credit sooner than waiting to file their 2009 or 2010 tax return? Yes. Prospective home buyers who believe they qualify for the tax credit are permitted to reduce their income tax withholding. Reducing tax withholding (up to the amount of the credit) will enable the buyer to accumulate cash by raising his/her take home pay. This money can then be applied to the downpayment.Buyers should adjust the withholding amount on their W-4 via their employer or through their quarterly estimated tax payment. IRS Publication 919 contains rules and guidelines for income tax withholding. Prospective home buyers should note that if income tax withholding is reduced and the tax credit qualified purchase does not occur, then the individual would be liable for repayment to the IRS of income tax and possible interest charges and penalties.In addition, rule changes made as part of the economic stimulus legislation allow home buyers to claim the tax credit and participate in a program financed by tax-exempt bonds. As a result, some state housing finance agencies have introduced programs that provide short-term second mortgage loans that may be used to fund a downpayment. Prospective home buyers should check with their state housing finance agency to see if such a program is available in their community. To date, 18 state agencies have announced tax credit assistance programs, and more are expected to follow suit. The National Council of State Housing Agencies (NCSHA) has compiled a list of such programs, which can be found here. HUD allows “monetization” of the tax credit. What does that mean? It means that HUD will allow buyers using FHA-insured mortgages to apply their anticipated tax credit toward their home purchase immediately rather than waiting until they file their 2009 or 2010 income taxes to receive a refund. These funds may be used for certain downpayment and closing cost expenses.Under the guidelines announced by HUD, non-profits and FHA-approved lenders are allowed to give home buyers short-term loans. The guidelines also allow government agencies, such as state housing finance agencies, to facilitate home sales by providing longer term loans secured by second mortgages.Housing finance agencies and other government entities may also issue tax credit loans, which home buyers may use to satisfy the FHA 3.5 percent downpayment requirement. In addition, approved FHA lenders can purchase a home buyer’s anticipated tax credit to pay closing costs and downpayment costs above the 3.5 percent downpayment that is required for FHA-insured homes. More information about the guidelines is available on the NAHB web site. Read the HUD mortgagee letter (pdf) and an explanation of the FHA Mortgagee Letter on Tax Credit Monetization (pdf). An FAQ about monetization (pdf) is available at the NAHB web site. If I’m qualified for the tax credit and buy a home in 2009 (or 2010), can I apply the tax credit against my 2008 (or 2009) tax return? Yes. The law allows taxpayers to choose (“elect”) to treat qualified home purchases in 2009 (or 2010) as if the purchase occurred on December 31, 2008 (or if in 2010, December 31, 2009). This means that the previous year’s income limit (MAGI) applies and the election accelerates when the credit can be claimed. A benefit of this election is that a home buyer in 2009 or 2010 will know their prior year MAGI with certainty, thereby helping the buyer know whether the income limit will reduce their credit amount.Taxpayers buying a home who wish to claim it on their prior year tax return, but who have already submitted their tax return to the IRS, may file an amended return claiming the tax credit using Form 1040X. You should consult with a tax professional to determine how to arrange this. For a home purchase in 2009 or 2010, can I choose whether to treat the purchase as occurring in the prior or present year, depending on in which year my credit amount is the largest? Yes. If the applicable income phaseout would reduce your home buyer tax credit amount in the present year and a larger credit would be available using the prior year MAGI amounts, then you can choose the year that yields the largest credit amount.

NAHB is providing the information on this web site for general guidance only. The information on this site does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind nor should it be construed as such. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action on this information, you should consult a qualified professional adviser to whom you have provided all of the facts applicable to your particular situation or question. None of the tax information on this web site is intended to be used nor can it be used by any taxpayer, for the purpose of avoiding penalties that may be imposed on the taxpayer. The information is provided “as is,” with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose. 1201 15th Street, NW Washington, DC 20005 Copyright © 2009 National Association of Home Builders. All rights reserved.

First Time Homebuyer Tax Credit Extended Into 2010! Plus…A New Tax Credit for Certain Existing Home Owners!

First Time Homebuyer Tax Credit Extended Into 2010! Plus…A New Tax Credit for Certain Existing Home Owners! It’s official. President Obama has signed a bill that extends the tax credit for first-time homebuyers (FTHBs) into the first half of 2010. This program had been scheduled to expire on November 30, 2009. In addition to extending the tax credit of up to $8,000 through June 30, 2010, the extension measure also opens up opportunities for others who are not buying a home for the first time. So Who Gets What? The program that has existed for FTHBs remains intact with the one exception that more people are now eligible based on an increase in the amount of income someone may now earn. Additionally, the program now gives those who already own a residence some additional reasons to move to a new home. This incentive comes in the form of a tax credit of up to $6,500 for qualified purchasers who have owned and occupied a primary residence for a period of five consecutive years during the last eight years. Deadlines In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010 and close no later than June 30, 2010. Higher Income Caps in Effect The amount of income someone can earn and qualify for the full amount of the credit has been increased. Single tax filers who earn up to $125,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, single filers who earn $145,000 and above are ineligible. Joint filers who earn up to $225,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, joint filers who earn $245,000 and above are ineligible. Maximum Purchase Price Qualifying buyers may purchase a property with a maximum sales price of $800,000. First-Time Homebuyer Tax Credit – Frequently Asked Questions Here are answers to some commonly asked questions about the tax credit. What is a tax credit? A tax credit is a direct reduction in tax liability owed by an individual to the Internal Revenue Service (IRS). In the event no taxes are owed, the IRS will issue a check for the amount of the tax credit an individual is owed. Unlike the tax credit that existed in 2008, this credit does not require repayment unless the home, at any time in the first 36 months of ownership, is no longer an individual’s primary residence. What is the tax credit for first-time homebuyers (FTHBs)? An eligible homebuyer may request from the IRS a tax credit of up to $8,000 or 10% of the purchase price for a home. If the amount of the home purchased is $75,000, the maximum amount the credit can be is $7,500. If the amount of the home purchased is $100,000, the amount of the credit may not exceed $8,000. Who is eligible for the FTHB tax credit? Anyone who has not owned a primary residence in the previous 36 months, prior to closing and the transfer of title, is eligible. This applies both to single taxpayers and married couples. In the case where there is a married couple, if either spouse has owned a primary residence in the last 36 months, neither would qualify. In the case where an individual has owned property that has not been a primary residence, such as a second home or investment property, that individual would be eligible. As mentioned above, the tax credit has been expanded so that existing homeowners who have owned and occupied a primary residence for a period of five consecutive years during the last eight years are now eligible for a tax credit of up to $6,500. How do I claim the credit? For those taking advantage of the tax credit in 2009, you may choose to either apply for the credit with your 2009 tax return or you may apply for the credit sooner by filing an amended 2008 tax return with Form 5405 (http://www.irs.gov/pub/irs-pdf/f5405.pdf). Can you claim the tax credit in advance of purchasing a property? No. The IRS has recently begun prosecuting people who have claimed credits where a purchase had not taken place. Can a taxpayer claim a credit if the property is purchased from a seller with seller financing and the seller retains title to the property? Yes. In situations where the buyer purchases the property, even though the seller retains legal title, the taxpayer may file for the credit. Examples of this would include a land contract, contract for deed, etc. According to the IRS, factors that would demonstrate the ownership of the property would include: 1. the right of possession, 2. the right to obtain legal title upon full payment of the purchase price, 3. the right to construct improvements, 4. the obligation to pay property taxes, 5. the risk of loss, 6. the responsibility to insure the property and 7. the duty to maintain the property. Are there other restrictions to taking the credit? Yes. According to the IRS, if any of the following describe your situation, a credit would not be due. You buy your home from a close relative. This includes your spouse, parent, grandparent, child or grandchild. You do not use the home as your principal residence. You sell your home before the end of the year. You are a nonresident alien. You are, or were, eligible to claim the District of Columbia first-time homebuyer credit for any taxable year. (This does not apply for a home purchased in 2009.) Your home financing comes from tax-exempt mortgage revenue bonds. (This does not apply for a home purchased in 2009.) You owned a principal residence at any time during the three years prior to the date of purchase of your new home. For example, if you bought a home on July 1, 2009, you cannot take the credit for that home if you owned, or had an ownership interest in, another principal residence at any time from July 2, 2006, through July 1, 2009. Can you buy a home from a step-relative and be eligible for the credit? Yes. Provided the person you are buying a home from is not a direct blood relative, the purchase would be allowed. Can parent(s) who will not live in the property cosign for a mortgage for their child and the child that is a qualifying FTHB still be eligible for the credit? Yes. Can a separated spouse who has not owned a home for four years qualify for the FTHB tax credit if the spouse has owned a property anytime in the last three years? No. However, the spouse may be eligible for the repeat buyer credit. The best path to take in any situation regarding income taxes is to speak with a professional tax preparer or CPA. If you have any questions that fall outside the situations here, give me a call and if you do not have an accountant to speak with, I can refer you to one.

Larry Weichman is President/ Broker for Costa Mesa based Weichman Realtors. His company has served Costa Mesa since 1976.  Larry also has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, his clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,100 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532

MYTH BUSTING!

 

When a homeowner faces default on their mortgage, there may be two options: foreclosure or short sale. Foreclosure can be devastating, both emotionally and financially. A short sale, or one in which the lender accepts a selling price less than the amount owed, is a better option for both the lender and the homeowner. Regrettably, nearly seven out of ten homeowners proceed through foreclosure without ever listing their home for sale. This is due largely to perceived myths about the process, and we need to put a few of these misconceptions to rest. First, homeowners assume the bank would rather foreclose than accept a short sale. Not true – foreclosure is often more costly for the lender, and short sales often sell for more than foreclosed listings. The banks are trying anything possible, within reason, to avoid the foreclosure process. Next, homeowners believe there is a stigma attached to short sale listings, and that buyers have no interest in such properties. Not true – to the contrary, many smart buyers are specifically seeking out such offerings for the value they present compared to traditional listings. Finally, homeowners often assume that there’s not enough time to close a short sale before foreclosure is final. Not true – foreclosure is a lengthy process and there is time to negotiate a better result, but you need to start today.

Larry Weichman is President/ Broker for Costa Mesa based Weichman Realtors. His company has served Costa Mesa since 1976. Please direct your questions to Larry@TeamWeichman.com or call 714-241-4532. You may also visit www.TeamWeichman.com.

A First Time for Everything!

An article appeared recently in the New York Times that beautifully illustrates the opportunities today’s real estate market offers. A mother working two jobs saved up for a down payment and managed to buy a large home with a pool for $187,000. Three years ago, that same home had sold for $370,000!

While sellers are still feeling pressure, buyers with stable incomes and good credit histories are beginning to spread a “feel good” vibe throughout the industry. Conditions have literally never been better for first-time buyers. Affordability has seldom been higher and interest rates have hardly been lower. Selection of inventory is vast, and sellers are highly motivated.

As more buyers enter the marketplace, the ripple effect will be felt far and wide. When they purchase a highly affordable foreclosure or “short sale,” they have removed a distressed property from the listings, improving values for other homes in the area. When they buy a “traditional” listing, that in turn sets off a chain reaction whereby the sellers in turn will purchase another home, from sellers who will in turn buy another home, and so on and so on.

You probably get the picture now. As we approach some stability in real estate, all indications are that prices will begin rising again. As the market approaches recovery, don’t miss your opportunity for the buy of a lifetime.

Larry Weichman is President/ Broker for Costa Mesa based Weichman Realtors. His company has served Costa Mesa since 1976. Please direct your questions to Larry@TeamWeichman.com or call 714-241-4532. You may also visit www.TeamWeichman.com.

NEW CALIFORNIA REAL ESTATE LAWS FOR 2009-10

NEW CALIFORNIA LAWS FOR 2009-10

The conclusion of the first half of the 2009-10 legislative session has brought many new laws that may affect California REALTORS® and their clients. Not surprisingly in the subprime aftermath, prominently featured among the new laws is stricter regulation of the mortgage lending industry.

REO Buyer Can Select Escrow and Title: Effective October 11, 2009, the Buyer’s Choice Act prohibits an REO lender selling residential property up to four units from directly or indirectly requiring the buyer to purchase escrow services or title insurance from any particular company. A buyer, however, who has received written notice of the right to make an independent selection, may agree to the REO lender’s escrow or title recommendations. An REO lender that violates this law can be held liable for three times the charges the buyer incurred, whereas a violation by the seller’s agent may be subject to license disciplinary action. This law expires on January 1, 2015. Assembly Bill 957.

No Advance Fee Loan Modifications: Starting October 11, 2009, a new law prohibits anyone from claiming any compensation for negotiating or arranging a loan modification until after that person fully performs each and every service as promised. Aimed at combating loan modification scams, this ban applies to upfront fees collected by real estate agents and attorneys. The ban expires on January 1, 2013. Also effective immediately, anyone who negotiates or arranges a loan modification must give the borrower a specified notice that paying a third-party for loan modification services is unnecessary. These new requirements apply to mortgage loans secured by residential property up to four units, with certain exceptions for lenders and loan servicers acting on their own behalf. Violations can be penalized by, among other things, a $10,000 fine plus one-year imprisonment for individuals, or a $50,000 fine for businesses. Real estate brokers with existing Advance Fee Loan Modification Agreements reviewed by the Department of Real Estate (DRE) can no longer, as of October 11, 2009, enter into these agreements or collect advance fees. Agreements entered into and advance fees collected before October 11, 2009 are not affected. For the DRE announcement, go to http://www.dre.ca.gov/pdf_docs/SB94WebAnnouncement(brokers).pdf. Senate Bill 94.
Advance Fee Redefined: Aside from loan modifications discussed above, Senate Bill 94 also broadens the definition of an advance fee which must be specially handled by real estate agents, such as by submitting an advance fee agreement for DRE review and placing funds received into a broker’s trust account. Under the new definition that took effect on October 11, 2009, agents cannot separate advance fees or services into components to avoid the advance fee requirements. More specifically, an advance fee is now defined as “a fee, regardless of the form, claimed, demanded, charged, received, or collected by a licensee from a principal before fully completing each and every service the licensee contracted to perform, or represented would be performed.” Exceptions include advertisements in newspapers of general circulation, tenant prescreening fees, and tenant security deposits. Senate Bill 94.
Mortgage Loan Originators Regulated: Beginning in December 2010, a real estate licensee acting as mortgage loan originator must obtain a license endorsement, which entails education, written testing, and reporting requirements. A mortgage loan originator is anyone who, for compensation or gain, takes a mortgage loan application or offers or negotiates terms of a mortgage loan for residential property containing one-to-four units. Exemptions include real estate agents who only engage in selling, buying, or leasing activities, unless compensated by a lender or mortgage loan originator. This license endorsement requirement comports with the creation of a Nationwide Mortgage Licensing System and Registry under recent federal law. Finance lenders and residential mortgage lenders under the Department of Corporation must also register in the nationwide system. Additionally, if a real estate broker or the broker’s salesperson makes, arranges, or services loans secured by residential property containing one-to-four units, the broker must notify the DRE by January 31, 2010 or within 30 days of commencing such loan activity, whichever is later. Senate Bill 36.
Mortgage Broker Activities Restricted: Commencing January 1, 2010, a mortgage broker will be deemed a fiduciary with a duty to place the borrower’s economic interest above his or her own. This fiduciary duty pertains to a mortgage broker who makes loans secured by residential property of one-to-four units. Also starting January 1, 2010, the law will strictly regulate higher-priced mortgage loans as defined, including requiring upfront disclosure if a mortgage broker only arranges higher-priced mortgage loans, restricting prepayment penalties and yield spread premiums, prohibiting negative amortization, and prohibiting mortgage brokers from steering borrowers to higher-cost loans. Assembly Bill 260.
Appraisal Industry Oversight: The Office of Real Estate Appraisers (OREA) will have regulatory oversight of appraisal management companies, which gained prominence after Fannie Mae and Freddie Mac adopted the Home Valuation Code of Conduct (HVCC). Starting January 1, 2010, the OREA must implement a registration system for appraisal management companies, including fingerprinting and background checks for persons with operational authority as defined. On a separate note, this law clarifies what conduct constitutes improperly influencing the appraisal process by anyone with an interest in a real estate transaction. Such prohibited conduct includes withholding or threatening to withhold an appraisal fee, withholding or threatening to withhold future appraisal business, and promising future business, promotions, or compensation. Senate Bill 237.
Mortgage Fraud Becomes a State Crime: As of January 1, 2010, anyone who deliberately makes any misrepresentation or omission during the mortgage lending process with the intent of influencing that process will be guilty of mortgage fraud under California law. A violation of this law is a crime punishable by one-year imprisonment. Under existing federal law, loan fraud against a federally-insured lender is a crime punishable by a $1 million fine, plus one-year imprisonment (18 U.S.C. section 1014). Senate Bill 239.
Increase in Homestead Exemptions: Coming into effect on January 1, 2010, the homestead exemption protecting a homeowner’s equity from judgment creditors has been increased by $25,000 across the board to $75,000 for individuals, $100,000 for married couples or family units as specified, and $175,000 for persons over 65 years, disabled, or over 55 years with limited income as specified. Assembly Bill 1046.
60-Day Notice to Terminate Tenants Extended: Existing law generally requiring a 60-day notice to terminate a month-to-month residential tenant, which was originally slated to sunset on January 1, 2010, has been extended indefinitely. A 30-day notice to terminate is sufficient if the tenant has lived in the property for less than one year, or if the landlord has sold the property and certain requirements are met as specified in our standard-form Notice of Termination of Tenancy (C.A.R. Form NTT). The 60-day notice requirement does not apply to fixed-term leases, such as a one-year lease. Other laws address tenants in properties foreclosed upon. Senate Bill 290.
Other Significant Laws: Other new laws that may interest REALTORS® include, without limitation, the following:

Landlord Utilities: Requires certain utility companies to notify residential tenants of landlord’s past due accounts and upcoming shutoffs, and allows tenants to begin service in their own names and deduct payment from rent (Senate Bill 120).
Mobilehome Parks: Prohibits management from requiring a homeowner to use a specific broker or dealer when replacing a mobilehome or manufactured home on a space in a mobilehome park (Senate Bill 804).
Swimming Pools: Requires anti-entrapment devices for owners of apartment buildings, condominium complexes, and others, including the filing of compliance statements (Assembly Bill 1020).
Mechanic’s Liens: Provides new procedures, including service of a Notice of Mechanic’s Lien to the owner and mandatory recording of a lis pendens when enforcing a mechanic’s lien (Assembly Bill 457).
Low Water-Using Plants: Renders unenforceable any HOA provision prohibiting landscaping with water-efficient plants in common interest developments (Assembly Bill 1061).
Reverse Mortgages: Provides new disclosure and other requirements under the Reverse Mortgage Elder Protection Act (Assembly Bill 329).
Disposal of Records: Shields from liability businesses that dispose of abandoned records containing personal information by shredding or erasing, and gives a legal presumption that a tenant owns records remaining on the premises after tenancy termination (Assembly Bill 1094).
Plumbing Fixtures: Provides new disclosure and other requirements for water-conserving plumbing fixtures effective on or after January 1, 2014 (Senate Bill 407).
This information is courtesy of the California Association of Realtors.

Larry Weichman is President/ Broker for Costa Mesa based Weichman Realtors. His company has served Costa Mesa since 1976. Larry also has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, his clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,100 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532

Moms Club of Costa Mesa

Check out this site for the mom’s living in the 92626 zip code!

http://www.costamesamomsclub.org/

What is the MOMS Club? The MOMS Club is a nationwide non-profit organization whose initials stand for “Moms Offering Moms Support.” The Club is a support group for you, the stay-at-home mother of today, interested in the world around you, wanting activities for you and your children, and proud of your choice of at-home mothering. The club offers a wide variety of club sponsored activities designed to provide fun, companionship, education and support to our members and their families. The MOMS Club and our members also do service projects that help needy children and others in our community.

This looks like a great organization!  Hope you enjoy!

Larry Weichman

www.TeamWeichman.com

Larry has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, my clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,100 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532

 

Purchase This Repo In Costa Mesa California Before It Hits the Market!

Purchase This Repo In Costa Mesa California Before It Hits the Market! Try $400,000 on this 4 Bedroom Home! I just found this home! We think it may be purchased around $400,000! Check out this video! For questions please contact me at 714-863-5739

Larry has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, my clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,000 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532

LOOKING FOR THE INVISIBLE

LOOKING FOR THE INVISIBLE

When you hear the term “home inspection,” you’re likely to think of the electrical system, plumbing, roof and foundation, and smaller items like cracked windows or drafty doors. However, it’s the elements in the home that cannot be seen that demand special attention on the part of buyers and sellers and the inspector they choose.

First, there’s radon, a colorless and odorless gas that seeps up from the ground and has been labeled as a cause of cancer. Any home, but particularly those with basements, should be tested for high levels of this gas.

Next is asbestos, a fibrous material once used for insulation, but banned in 1985. Homes built before then should be tested, and care should be exercised not to disturb this material when remodeling these older homes.

Another threat is lead, a toxic metal that was widely used in paint, pipes, and other materials. Any home built before 1978 should be tested for its presence, and any lender offering HUD-insured mortgages will require a lead-safe certification for these older structures.

Another culprit is groundwater contamination, a particular concern for homes with older septic systems or underground oil tanks, or homes near industrial facilities. Also search for hazardous products stored in and around the home, making certain that they are removed before transfer of the property to new owners. Be smart and be safe!

Larry has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, my clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,000 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532

16 foreclosed homes can be obtained for between $159,000 to $1,400,000, in Huntington Beach!

Almost-unbelievable deals can be located among the Homes in Foreclosure in Huntington Beach. If you’ve been needing a larger home with more upscale features, now is the perfect time to investigate your choices. Perhaps you are a first-time home shopper. Right now, these 16 foreclosed homes can be obtained for between $159,000 to $1,400,000, so folks of all income levels can probably locate Huntington Beach foreclosure real estate that accommodates their requirements. Huntington Beach foreclosures are attracting plenty of interested buyers, so start browsing now!

http://www.allhuntingtonbeachrealestate.com/60344-Huntington-Beach-CA-Foreclosed-RESCity.aspx

Larry has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, my clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,000 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532

   

 

Any Questions call 714-241-4532

Huntington Beach Historical Society’s Civil War Days

Huntington Beach Historical Society’s Civil War Days

 

Huntington Central Park 7111 Talbert Ave. Huntington Beach, CA  92648 Phone: 714-969-8928 Dates & Times: September 05 – September 06, 2009; Every day (8 a.m. to 4 p.m.) Civil War Days features live weapons demonstrations, living histories and battle reenactments.  Abraham Lincoln will also deliver the Gettysburg Address to celebrate his 200th birthday. All refreshment proceeds benefit the Huntington Beach Historical Society.   Saturday 10:00 a.m. – Camp open to public 1:30 p.m. – First battle 2:30 p.m. – Living history and weapons demonstrations 4:00 p.m. – Second battle Twilight concert after second battle   Sunday 8:00 a.m. - Church services 9:00 a.m. – Camp opens 11:00 a.m. – First battle 12:00 p.m. – Living history and weapons demonstrations 2:00 p.m. – Second battle   Please note these times are approximate.   Due to loud noises during shows the Historical Society does not recommended bringing your dog to this event. Directions: Reenactments will be held behind the library off Gothard Street between Slater and Talbert Avenue. Cost: Free Parking: Free

Larry has over 15 years of experience in Bank Repos and Short Sales and non foreclosed real estate, my clients include General Electric Mortgage, Home Savings, Associates Finance, Transamerica. Current clients include Bank of America, Ocwen Financial Corporation, Countrywide and Keystone Asset Management to name a few. Larry is President of Weichman Associates located in Costa Mesa California. He has sold real estate since 1976 and is a 3rd generation Real Estate Broker. Larry has closed escrow on over 1,000 properties; from townhomes to commercial buildings. Please be sure to visit us on the Internet at www.TeamWeichman.com, www.OCHomeTracker.com or www.OCRepoBroker.com or you can call me at 714-241-4532