Breaking News: Case/ Shiller Housing Index Shows Second Month In A Row Of INCREASE IN SALES!
We have been seeing continued reports of the strengthening of the national real estate market. Certainly in Palm Beach County Florida, one of the first and hardest hit areas in the country, the numbers have continued to move positive.
In areas such as Palm Beach Gardens, Jupiter and West Palm Beach, short sales and bank owned foreclosures are making up a large part of the pending home sales as first time home buyers are rushing to take advantage of the low interest rates, the First Time Home Buyer Tax Credit, and home prices that haven’t been seen since 2004. Many homes in the area are actually having multiple offers presented.
The following excerpt provides speculation the long awaited end to the real estate crisis may be at an end.
The national home-price index released on Tuesday rose for the second straight month in June, fueling hopes the housing downturn, which is in its third year, is waning. Still, the index was off roughly 15% in the second quarter from the year-ago period. See Economic Report.
In a teleconference Tuesday, Shiller was reluctant to call a definitive bottom in home prices, saying he’s seeing “conflicting signals” in the housing market.
Well then, I will do it. There is a clear bottom in most housing markets for homes that are less than $200,000. Will this last? I think it will. There first time buyers and investors out there that there won’t be any further significant value decreases for homes less than $200k. Now, with that said, if the ‘First Time Buyer Credit of $8,000′ is not renewed….and if the banks make the mistake of dumping too many foreclosures on the market too fast…all bets are off.
On the positive side, the rise in home prices in May and June is a “sudden break in momentum” from years of nearly steady, punishing declines that may signal a turning point. “The roller coaster is now going up,” Shiller said.
Yet he noted what appeared to be a housing recovery in early 2008 “fizzled” when prices resumed their decline. And a long-term chart of home prices makes it look like “we are still in the process of a bursting bubble.” Shiller expressed “great reluctance” to forecast where prices will go from here with the U.S. economy in the midst of the most severe recession since the Great Depression.
Where will prices go? There WILL BE more depreciation for the more expensive…non first time buyer/ Investor price ranges. In some cases this depreciation will be dramatic. We are predicting that the next wave of foreclosures will force the ‘upper end’ housing markets to lose as much as 30%+ over the next 12-24 months.
“Unemployment looks like a bad indicator for the housing market,” Shiller said.
There are other challenges that could snuff out the nascent revival in home prices. One of the biggest threats is the mounting wave of foreclosures as more strapped borrowers struggle to meet their monthly mortgage payments. The First-time buyer tax credit is set to go away in November, and rising interest rates could also dampen sales, economists say.
The First-time buyer tax credit is set to go away in November, and rising interest rates could also dampen sales, economists say.
Indeed, recent experience has taught homeowners that prices can be very volatile, said David Blitzer, chairman of the index committee at S&P, during Tuesday’s call.
On a national level, home prices are back to levels last seen in 2003, but the cities that saw the biggest run-ups also fell the hardest.
“The idea that they could never go down was wrong,” Blitzer said.
He added the data coming out of the housing market in recent months have been encouraging, but warned against breaking out the champagne just yet. Commenting on so-called shadow inventory, he said many sellers have been waiting for an uptick in house prices to put their homes on the market, Blitzer said. This could exacerbate the supply glut and push a recovery further into the future.
Source: MarketWatch.com
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc. Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
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Monday, August 31, 2009
Are we ready to call the end of the real estate crisis in Palm Beach County?
Sunday, August 30, 2009
Short Sale Myths...and Facts Part 2
Watch this video to learn the facts about short sales. Rodney is a short sale specialist in Palm Beach Gardens Florida. If you have any questions as to whether a short sale is right for you, call Rodney at 561-337-4810, or visit his real estate blog at http://SouthFloridaRealEstateReport.com
Tuesday, August 25, 2009
Florida Home Buyers...The Best Program Nobody Knows About!
With the real estate market in south Florida still trying to recover, so much attention has been given to the $8000 First Time Home Buyer Tax Credit. It certainly has helped with getting many buyers off the fence to take advantage of affordable home prices and low interest rates.
So much attention has been given to the Federal tax credit that it seems no one know about the Florida Down Payment Assistance Loan. This program is designed to help low to middle income families with the down payment to purchase a home.
It is a Florida bond program and is based entirely on income. For example, a family of 4 in Palm Beach County must make less than $75,400.
There are restrictions, but you don't have to be a first time home buyer under certain circumstances. The money doesn't need to be paid back if you stay in the home for the term of the loan or until the loan is satisfied.
You can get more information on the program from The Florida Housing Finance Corporation.
Prices have been kept low due to the flood of bank owned foreclosure and short sales. But with homes sales incresing in many areas, particularly in Palm Beach and St. Lucie counties, this could be the perfect time to buy.
Before you make a move, be sure to investigate all forms of home buyer assistance.
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website.For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc.Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
This program, added to the $8000 First Time Home Buyer Tax Credit could give you a total government assistance of $18,000!
The Perfect Real Estate Storm…for Buyers : Palm Beach Gardens Foreclosures
May
22
The Perfect Real Estate Storm…for Buyers
May 22, 2009 | Tagged $8000 tax credit, buy a Palm Beach Gardens foreclosure home, down payment assistance, first time home buyer, Florida foreclosure realtor agent, florida foreclosure tips, mortgage interest rates, Palm Beach Gardens foreclosure realtor agent, palm beach gardens real estate, Palm Beach Gardens short sales, West Palm Beach foreclosures | Leave a Comment
With all the rain we’ve had in south Florida over the last week (I can’t believe it either) I’m reminded of the movie “The Perfect Storm” with George Clooney.
Once every 20 or 30 years a series of weather events combine to create “the perfect storm”. You know the movie. Unfortunately, this perfect storm didn’t work out so well for George Clooney and his crew.
The current real estate market in south Florida and the national economy in general has created our own version of a “perfect real estate storm”. If you are a buyer or potential buyer of real estate in the south Florida area the conditions may never be better for you.
Here are the current market conditions as I see them (at least in my area of southeast Florida:
- Average home prices are at 2003-2004 levels
- Long term fixed rate mortgage rates are around 5% (historic lows)
- The government is doing everything it can to rebound the economy, starting with the real estate market
- $8000 First Time Home Buyer tax credit continues to draw in buyers
- The first group of baby boomers are retiring. The top choice of places to retire is still Florida
- Florida has no state income tax.
These and other factors will continue to move the real estate market. How long will it take for the real estate market to really improve? Who knows, but my guess is Florida, especially south Florida will lead the country in the real estate recovery. Smart buyers may very well look back years from now and remember this time as the perfect real estate storm, and a good one!
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc.
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Comments
Originally posted on May 22, 2009, this scenario is more real now. As a matter of fact, when I first wrote this piece, many people thought I was crazy!
Palm Beach Gardens Short Sales : Palm Beach Gardens Short Sales
Apr
25
Palm Beach Gardens Short Sales
April 25, 2009 | Tagged buy a short sale home, Florida Short Sales, how to do a short sale in Palm Beach County, Palm Beach Gardens Short Sales, short sale help, short sale realtor, short sale tips | Leave a Comment
Are you underwater on your mortgage?
Do you owe more on your home than it’s worth?
Did you buy when the market was going up or at it’s peak?
Has your mortgage adjusted to a level where you can’t afford it?
Are you facing a hardship such as loss of job, death in the family or divorce?
Has your request for loan modification been turned down by your bank?
If you’ve answered YES! to any of these questions a short sale may be the best option for you. A short sale is when you sell your home for less than what is owed and the bank agrees to make up the difference.
There are many misconceptions about short sales and how they affect you. Our site and video series on short sale helps to set the record straight.
Rodney Forbes, author and real estate broker for Forbes Realty of South Florida, has written a book titled “Should I Short Sale My Home?” and you can order a FREE copy by clicking here. Rodney works in the Palm Beach County Florida area and is a Certified Short Sale Specialist.
If you have any questions concerning your particular situation please call 561-337-4810 for a FREE and confidential interview. You can also email Rodney@ForbesRealtynline.com
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Comments
If you feel a short sale may be an option for you please call Rodney at Forbes Realty of South Florida. 561-337-4810. Rodney is a Certified Short Sale Specialist. or visit http://SouthFloridaRealEstateReport.com and leave your contact information for a free confidential consultation
Consequences of a Short Sale..and Relief : Palm Beach Gardens Short Sales
Apr
30
Consequences of a Short Sale..and Relief
April 30, 2009 | Tagged Florida Short Sales, foreclosure alternatives, how to do a short sale in Palm Beach County, Palm Beach Gardens Short Sales, short sale help, short sale irs, short sale math, short sale realtor, short sale taxes, short sale tips | Leave a Comment
In south Florida short sales now make up about 30-40% of pending sales. Although we hear of people having to do home short sales every day, not too many people know the potential tax consequences of the process. The tax relief available for short sales can be equally confusing.
The important thing to get from this article is to make sure to use a knowledgeable short sale specialist for a realtor and have a good tax attorney for advice.
It’s not so unusual these days to have mortgage debt that exceeds the current value of your principal residence. If you hang on to the property long enough, you have a reasonably good chance of riding out the storm with little or no harm done. On the other hand, if you have to sell now, you face what’s called a “short sale” — which means selling for a net sales price (after subtracting commissions and other closing costs) that’s less than the outstanding mortgage debt.
What are the tax consequences of a short sale? The easiest way to explain it is with some examples.
Tax gain on a short sale. Say you paid $200,000 years ago for a principal residence that you could now sell for a net sales price of $300,000. Unfortunately, you also have $350,000 of first and second mortgages against the property because you took out a big home-equity loan a couple of years ago at the top of the market when the home was worth $500,000.
Believe it or not, you’ll have a $100,000 gain for tax purposes if you sell. Why? Because the net sales price exceeds the tax basis of the home: $300,000 sales price minus $200,000 basis equals a $100,000 gain. (Your tax basis equals what you paid for the property plus the cost of any improvements made over the years, minus any past depreciation writeoffs if you rented the property out or used part of it for deductible business purposes.)
While it doesn’t seem fair that you could have a $100,000 tax gain from a sale that leaves you $50,000 in the red with your mortgage lenders, that’s the way the law works. Mortgage debts don’t enter into the gain-on-sale calculation.
Now for the good news: You’ll probably be able to exclude the $100,000 gain for federal income-tax purposes, thanks to the federal home-sale-gain exclusion break. If so, you won’t have to report the $100,000 gain on your Form 1040. You may or may not qualify for the same favorable treatment on your state income-tax return.
Tax loss on short sale. Of course, you can also have a short sale where the net sales price is less than your tax basis in the property.
Say you paid $415,000 for a principal residence that you could now sell for a net sales price of $300,000. You also have $350,000 of first and second mortgages against the property. For tax purposes, you’ll have a $115,000 loss if you sell because the sales price is lower than your tax basis in the home: $300,000 sales price minus $415,000 basis equals a $115,000 loss.
Will the IRS let you claim a writeoff for that loss? Nope. You can only claim a federal income tax loss on investment or business property. A loss on a personal residence is considered a nondeductible personal expense. Most states follow the same principle.
Excess debt. In both the preceding examples, the mortgage debt exceeded the net sales price by $50,000. If the lender won’t let you off the hook for any of that excess, you’ll have to figure out a way to pay it, and you won’t get any tax break for doing so.
If you’re more fortunate, the lender will forgive some or all of the excess $50,000. To the extent debt is forgiven, you have so-called debt-discharge income, or DDI. The general rule is that DDI is taxable income. For the year that DDI occurs, the lender should report the amount to you (and to the IRS) on Form 1099-C. Happily enough, there are some taxpayer-friendly exceptions to the general rule that DDI is taxable. Here they are:
Up to $2 million of DDI from mortgage debt that was originally taken out to acquire, build or improve the borrower’s principal residence is tax-free (you must reduce the basis of the residence by the tax-free amount). This super-favorable rule is not available for DDI from debt that was not used to acquire, build or improve the principal residence, such as DDI from a home-equity loan used for other purposes.
If the borrower is in bankruptcy proceedings when the DDI occurs, the DDI is tax-free.
If the borrower is insolvent (that is, has debts in excess of assets), the DDI is tax-free as long as the borrower is still insolvent after the DDI occurs. If the DDI causes the borrower to become solvent, part of the DDI will be taxable (to the extent it causes solvency). The rest will be tax-free.
To the extent DDI consists of unpaid mortgage interest that was added to the loan principal and then forgiven, the forgiven interest that could have been deducted (had it been paid) is tax-free.
If the DDI is from seller-financed mortgage debt owed to the previous owner of the property, it’s tax-free. However, the basis of the property must be reduced by the tax-free DDI amount.
The important thing to understand is that a real-estate short sale can potentially result in a taxable gain and/or taxable DDI. Thankfully, you can probably exclude the gain from taxation under the federal home-sale-gain exclusion deal, and you might be able to exclude some or all of the DDI, too, under the favorable exceptions explained above.
Source: Wall Street Journal
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. Call directly at 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc.
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Comments
A short sale of your home is something no one wants to think about, especially not knowing what happens when you sell for less than you owe. This article is hopeful news for many Palm Beach County homeowners in this situation. For a free consultation about your particular situation please call Rodney at Forbes Realty of South Florida 561-3370-4810 or visit http://SouthFloridaRealEstateReport.com and leave your contact information.
$8,000 Tax Credit Expires December 1st : Palm Beach Gardens Short Sales
Jun
30
$8,000 Tax Credit Expires December 1st
June 30, 2009 | Tagged $8000 tax credit, Add new tag, buy a short sale home, Florida Short Sales, palm beach gardens first time home buyers, palm beach gardens foreclosures, palm beach gardens real estate, palm beach gardens realtor, Palm Beach Gardens Short Sales | 3 Comments
As home prices remain at bargain levels, and interest rates continue to stay at historic lows, many people are asking for details on the First Time Home Buyer Tax Credit. Who qualifies, when and how do I get the money, are there restrictions?
The following article gives some answers to basic questions as well as the most important answer for most, the expiration date.
According to Keystone Custom Homes, first-time buyers need to be aware that the tax credit is only available now until Dec. 1, 2009 on a closed home purchase. There are other aspects of the tax credit that are important to first-time home buyers, including:
– The tax credit is not a deduction. “It’s much better than that,” says Wisdom. With a deduction, you can only write off the deduction against your total income. So if you make $60,000, you can only reduce your total income by the amount of the deduction, which really isn’t that much savings. For instance, if you have an $8,000 deduction and earn $60,000, you still have pay taxes on $52,000. That’s not much of a savings. But the $8,000 First-Time home buyer tax credit is dollar for dollar. “So you actually reduce your tax payment by the amount of the credit. For instance, if next year, you go to file your taxes and learn that you owe nothing to the IRS, you will receive a check back for $8,000!” says Wisdom.
– First-time home buyers can receive a short-term loan to use the tax credit toward a down payment. In late May 2009, the Federal Housing Administration announced that it will allow eligible first-time home buyers to apply the $8,000 first-time home buyer tax credit to a down payment on a home. This can be done through no-interest loans now available through FHA-approved lenders in the Commonwealth. The loans must be paid back using the tax credit, which is applied to a home buyer’s 2009 tax return. First time home buyers can learn more about this opportunity by talking to their FHA-approved lender or mortgage broker.
For Florida, governor Charlie Crist approved the program as of July 1st. The details of who will administer the program are not clear. The program may be run by the Florida SHIP program.
– The first-time home buyer tax credit is available even if you make good money. The tax credit is available to single first-time home buyers who make less than $75,000 a year or couples who make less than $150,000 a year. “That income covers a lot of Americans,” says Wisdom. “And it’s also based on adjusted gross income. So if you make more than those limits, but deductions reduce your income to those limits, you still might be eligible for the tax credit or a good portion of it.”
– There are ways to receive your tax credit now without applying for a loan. First-time home buyers in essence can gain the benefit of the up to $8,000 tax credit this year by reducing their income withholdings to the amount of the credit. This will allow you to see more cash in your take home pay. And that’s money can then be used toward a down payment or for moving and other costs related to owning a brand new home.
If you have recently closed on a home and plan to use the tax credit, you can also file an amended return for your 2008 taxes and get the tax credit now. Discuss this with your accountant or CPA.
“Obviously, a first-time home buyer should check with their accountant before making any assumptions,” says Wisdom. “But right now, we are seeing record traffic at many of our 24 communities, and much of their interest is due to exceptionally low prices coupled with the Federal Tax credit. Add that to the fact that interest rates, while beginning to rise, are still at near-historic lows, and the combination of these factors makes it the best time in generations to buy a first home.”
Source: Market Watch
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc. Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
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Comments
3 Comments so far
- real estate web 2.0. on July 9, 2009 1:21 pm Edit This
There are many ways to lose a home but signing away ownership in a manner that destroys credit, embarrasses the family and strips an owner of dignity is one of the hardest. For owners who can no longer afford to keep mortgage payments current, there are alternatives to bankruptcy or foreclosure proceedings. One of those options is called a “short sale.”
- real estate web 2.0. on July 9, 2009 1:27 pm Edit This
I just did a short sale on an investment property of mine. I worked with a company that specializes in short sales http://www.HousingAssist.com. They got the process completed for me in under 90 days. I’ve also heard many horror stories so I am very happy it went smoothly.
- foreclosure marketing on July 9, 2009 1:28 pm Edit This
When the value of a home drops by 20%, it’s tempting to let it go into foreclosure, or work out a short-sale agreement with the bank. But giving up a current home in the hopes of paying less on a future home may cost even more money – or put your finances in a riskier situation.
Palm Beach County home buyers be aware. If you are considering a short sale or foreclosure purchase to take advantage of bargain basement prices, it usually takes longer to close these tranactions, so don't wait until the last minute to act. Many homes for sale in Jupiter, West Palm Beach and Palm Beach Gardens are having multiple offers submitted.
For more information call Rodney at Forbes Realty of South Florida, 561-337-4810, or go to http://SouthFloridaRealEstateReport.com and leave your contact information.
You Need to Hear This! : Palm Beach Gardens Short Sales
May
30
You Need to Hear This!
May 30, 2009 | Tagged Florida Short Sales, foreclosure alternatives, foreclosures, how to do a short sale in Palm Beach County, Palm Beach Gardens Short Sales, short sale help, short sale realtor, short sale scams, short sale tips, short sales | Leave a Comment
If you are a homeowner in distress you need to read this. Short sales are a viable method for getting out from underneath a home mortgage that is driving you into either foreclosure, bankruptcy, or both.
What’s most important in this situation is that you find a Realtor who has specialized training and experience in the field. You don’t want to risk the future of your home and credit to a novice short sale agent.
Some of the questions you should ask are:
- How long have you been working with short sales?
- Have you worked on both sides of the sale (buyer’s agent and listing agent)?
- Have you rceived any specialized training?
- How many of your short sale listings actually close?
- Do you handle the bank negotiations personally or have a specialist who is the bank contact?
- Have you done BPO’s (Broker Price Opinions)? These reports help banks determine value when short selling a property
- What is your online prescence for marketing properties?
Probably the most important thing is whether you feel comfortable withthe agent. Many people feel obligated to the first Realtor who they meet with. Remember, you’re interviewing in the beginning. You need to use the agent you feel will get the job done.
I hope this helps guide you through what is a difficult and trying time. Make sure you have someone who empathizes with your situation and doesn’t treat you as just another listing.
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc.
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Comments
More than ever people considering a short sale need an experienced Realtor to assist in the sale. With short sales consisting of around 30% of the homes on the market, you MUST have the best working for you.
Will Congress Extend $8000 Home Buyer Tax Credit? : Palm Beach Gardens Short Sales
Aug
25
Will Congress Extend $8000 Home Buyer Tax Credit?
August 25, 2009 | Tagged $8000 tax credit, buy a florida home, Jupiter Short Sales, Palm Beach County real estate, palm beach gardens first time home buyers, Palm Beach Gardens Short Sales, West Palm Beach Short Sales | Leave a Comment
$8000 Tax Credit
Many of my buyer clients in the PalmBeach Gardens and West Palm Beach areas have been asking about the possibility of an extension on the successful $8000 First Time Home Buyer Tax Credit into next year. With the time frame for getting a home under contract to qualify for the program getting short many homes in the Palm Beach County area are actually having multiple offers presented.
Although I’m advising people to take advantage of the tax credit now because of affordable home prices and low interest rates, my guess is that the tax credit will be extended, maybe even increased, next year. There are still a large supply of short sale and foreclosure homes on the market.
The following is an excerpt from a Wall Street Journal article.
Not only are some legislators (and real-estate industry lobbyists) already pushing hard for an extension of the tax credit, which will expire Nov. 30, but they’re also arguing that it should be increased, to $15,000, and expanded to all buyers, and not just those who are first-timers. The current $8,000 tax credit emerged in the stimulus legislation that Congress passed in February, replacing an existing $7,500 credit that had to be repaid over 15 years.
“Congress is not going to endanger the fragile beginnings of a housing recovery by letting the credit lapse,” said Howard Glaser, a mortgage-industry consultant in Washington, in this story on July’s strong home sales figures in Saturday’s WSJ. The story noted that Senate Majority Leader Harry Reid, who faces a tough election fight next year in Nevada, a state hard-hit by the housing bust, favors extending the credit.
But columnist Kenneth Harney notes in his latest column that Congress faces a number of high-profile issues (health-care, anyone?) that face Congress upon legislators’ return, and those priority issues could get in the way. “On top of that, a tax credit extension would cost billions in lost revenue — a big negative when the federal budget deficit is in record red-ink territory,” he writes.
Meanwhile, there’s an argument to be made that the housing market is now much closer to a bottom than it was in early 2009 or mid 2008, when the previous tax credits were implemented. The idea behind those credits, in part, was that they would help give buyers some insurance against future price declines. With housing markets nearing some type of stabilization (at least those for first timers), does that rationale still hold? Many first-time buyer markets are now seeing bidding wars and low prices that could be enough to spur demand without any stimulus.
Courtesy: Nick Timiraos of The Wall Street Journal.
With experts predicting an increase in interest rates later this year and housing demand growing due to the factors above it may be the perfect time to buy a home and take advantage of the tax credit at the same time.
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc. Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
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Comments
I'm betting on an extension of this tax credit as a further incentive for Palm Beach County home buyers to take advantage of short sale and foreclosure opportunities.
Monday, August 24, 2009
Palm Beach Gardens Realtor Rodney Forbes Introduces Blog and gives free book offer
Rodney Forbes, short sale specialist for Forbes Realty of South Florida introduces you to the South Florida Real Estate Report blog site. You can receive a free copy of his book "Should I Short Sale My Home?" by entering your information on the site. Rodney is located in Palm Beach Gardens Florida and works all of Palm Beach County. If you have any questions about your situation please call Rodney at 561-337-4810 or email Rodney@ForbesRealtyOnline.com
Short Sale Myths...and Facts Video Series #1 from Palm Beach Gardens Realtor Rodney Forbes
Rodney Forbes, Realtor and broker for Forbes Realty of South Florida, begins a video series on the myths and facts about real estate short sales. Rodney works in the Palm Beach Gardens area of south Florida and his company's focus is helping homeowners in distress. For questions regarding your particular situation please call 561-283-6497 or email Rodney@ForbesRealtyOnline.com. For news and information about Palm Beach County real estate visit http://SouthFloridaRealEstateReport.com
Sunday, August 23, 2009
Hilarious Jon Stewart Daily Show Video on the Housing Crisis
This video may make you laugh and cry at the same time as it spoofs the intelligence of the government officials overseeing the economy and real estate market.
Friday, August 21, 2009
Palm Beach Gardens Short Sales
Aug
21
Palm Beach Gardens Realtor Reveals Technology Secrets for Agents
August 21, 2009 | Tagged Blogging for realtors, make money with Twitter, palm beach gardens realtor, Real Estate Agent coaching, Real estate agent technology training, Realtors on Facebook, Realtors using Twitter | Leave a Comment
Palm Beach Gardens Realtor Rodney Forbes
Palm Beach Gardens Realtor Rodney Forbes was featured in a national real estate teleconference focused on technology, blogging and social media. Rodney is broker for Forbes Realty of South Florida, located in West Palm Beach. Real estate professionals seem to be the last to adopt new technologies, especially when internet sites like Facebook and Twitter are seen as sites for bored teenagers.
Cutting edge real estate agents are understanding the power of social media sites for networking. For real estate professionals, most considered their web prescence to be a website with IDX access for visitors. Few, if any, actually get business from their sites, many costing thousands of dollars to set up and maintain.
“Web 2.0″, as the new internet wave is referred to, focuses on interactive media such as blogs, video and networking sites such as Twitter. Old, static websites are being replaced by free, or mostly free, blog sites and networking platforms. Agents who want to stay ahead of the curve are using Youtube, Twitter, Facebook, LinkedIn and many other “2.0″ technologies.
Click here to listen to a replayof the FREE 90 minute call from Harris Real Estate University. Harris is the largest online realtor coaching program in the country.
If you have any questions regarding the information in this teleconference, call Rodney directly at 561-283-6497 or email Rodney@ForbesRealtyOnline.com
Rodney created his real estate blog using the information in this call. Click here to check it out.
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15
Short Sale Myths and Facts…Part 3
August 15, 2009 | Tagged Florida short sale homes, Jupiter Short Sales, palm beach gardens real estate, Palm Beach Gardens Short Sales, short sale help, short sale myths, short sale realtor, short sale tips | Leave a Comment
The topic of short sales and foreclosures seem to dominate the headlines everywhere. There has been a lot written about short sales and whether you should or shouldn’t short sale your home if you’re in this situation. This has led to many misconceptions about short selling your home.
This series is about the myths regarding short sales. Caveat: The rules regarding short sales are different for every lender and are changing all the time as the market changes. ALWAYS consult a real estate attorney and a CPA regarding the particulars of short selling.
Short Sale Myth #3:
Banks don’t accept short sales.
Even in today’s real estate market there is a widely held belief that banks won’t even accept a short sale. Maybe two years ago when the default rate was much lower banks would deny they accepted short sales if you had called with a hardship.
Today every bank and mortgage company I know of does short sales. It’s just a sign of the times. In Palm Beach County about 30% of all real estate listings are short sales. It may take awhile to get them approved but banks would rather do a short sale than to take a property back under foreclosure.
The most important thing to remember when contemplating whether a short sale is right for you is to get good advice from a real estate attorney and CPA.
If you are considering a short sale make sure you also consult with a licensed Realtor(r) who specializes in short sales. In the Palm Beach County area, especially in Palm Beach Gardens, West Palm Beach and Jupiter, Forbes Realty of South Florida is focused on short sales and helping homeowners through the process.
Rodney Forbes, broker for Forbes Realty, has also co-authored the book “Should I Short Sale My Home?”. Click her for your FREE copy.
Watch for the next article in the Short Sale Myths series. Or, just subscribe to the blog and they will be sent automatically.
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc. Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
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Part 2 of Short Sale Myths and Facts
July 1, 2009 | Tagged Florida real estate, Florida Short Sales, how to do a short sale in Palm Beach County, palm beach gardens foreclosures, Palm Beach Gardens Short Sales, short sale help, short sale irs, short sale math, short sale myths, short sale realtor, short sale scams, short sale taxes, short sale tips | Leave a Comment
The topic of short sales and foreclosures seem to dominate the headlines everywhere. There has been a lot written about short sales and whether you should or shouldn’t short sale your home if you’re in this situation. This has led to many misconceptions about short selling your home.
This series is about the myths regarding short sales. Caveat: The rules regarding short sales are different for every lender and are changing all the time as the market changes. ALWAYS consult a real estate attorney and a CPA regarding the particulars of short selling.
Short Sale Myth #2:
Short sales are impossible and never get approved.
Fact:
Because of the current real estate market, short sales will be around for a long time. The fact that they may take longer to complete than a traditional sale doesn’t mean they’re impossible.
The most important thing to remember when you’re involved in a short sale transaction, as a buyer or a seller, is to make sure yu’re dealing with realtors who are experienced in short sale transactions. Having an experienced team to walk you through the process is essential.
As far as numbers go, for those who think that short sales are impossible and never close, in Palm Beach County, 656 short sale transactions have closed in the last 90 days!
If you are considering a short sale make sure you also consult with a licensed Realtor(r) who specializes in short sales. In the Palm Beach County area, especially in Palm Beach Gardens, West Palm Beach and Jupiter, Forbes Realty of South Florida is focused on short sales and helping homeowners through the process.
Rodney Forbes, broker for Forbes Realty, has also co-authored the book “Should I Short Sale My Home?”. Click her for your FREE copy.
Watch for the next article in the Short Sale Myths series. Or, just subscribe to the blog and they will be sent automatically.
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc. Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
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Would YOU Walk Away From Your Home?
July 1, 2009 | Tagged Florida Short Sales, foreclosure alternatives, how to buy a short sale, how to do a short sale in Palm Beach County, mortgage crisis, palm beach gardens foreclosures, palm beach gardens real estate, Palm Beach Gardens Short Sales, short sale help, short sale realtor, short sale taxes, short sale tips | Leave a Comment
New study about what economists are calling, “Strategic Default”. Where homeowners who CAN afford to stay in their homes despite negative equity are choosing not to……
How widespread is this practice? New research* based on a survey of 1,000 homeowners suggests that one in four mortgage defaults are “strategic”—by people who could meet their payments but who choose not to. The main drivers of strategic default are the scale of negative equity, and moral and social considerations. Few would opt to renege on their mortgage if the equity gap were below 10% of their home’s value, the authors find, partly because of the costs of moving. But one in six would bail out if loans were underwater by a half.
* 25% of all defaults are homeowners who CAN afford to pay..choosing not to. They are making the decision that the negative ramifications of foreclosure (or short sale) are less significant to them than the burden of the negative equity.
Four-fifths think strategic default is wrong. Those in the unethical minority are four times more likely to renege on loans (allowing for other influences) when their negative equity reaches $50,000. But morality has its price. When the equity gap reaches $100,000, “immoral” homeowners are only twice as keen to walk away from their debts as “moral” ones. People under 35 or over 65 are less likely to believe that default is wrong. So are the well-educated.
* Interesting….People under 35 or over 65 are less likely to believe that default is wrong. So are the well-educated.
* There IS a price…there is a number where even the most financially conservative homeowner will walk away. Understand, this is what keeps the banks (and the government) up at night. They know that once a homeowner is X% upside down…they will let the house go..(Short Sale or for the misinformed…foreclosure).
Anger about bail-outs of banks or carmakers does not weaken the moral barrier to default. But people who live in neighbourhoods where home repossessions are frequent are more likely to welsh on loans. Homeowners who know someone who has defaulted strategically are 82% more likely to say they would do so, too. The likelihood of strategic default rises more quickly once the rate of local home foreclosures reaches a critical level. That hints at a vicious cycle of foreclosures that both depress home prices and weaken the social and economic barriers to further defaults. To break the cycle, policymakers need to address the problem of negative equity, not just unaffordable interest payments.
Here are my questions for you…what is your number? Seriously….at what point would you decide that leaving is better than staying…
Are you considering or have you already done a ’strategic default’?
How much negative equity would your mortgage have to be before you choose to sell it short sale (etc)?
What are you seeing in your market..are homeowners choosing to let their homes go that are 10% upside down….30%…50%? In areas of the country where homes have depreciated 30%+ what will keep those homeowners from not following this same path?
Let us know what you think..share your comments….
(The answer to THESE QUESTIONS are at the essence of what will allow this housing lead depression/ recession to end)
Thanks to: Tim Harris
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc. Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
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Short Sale Myths and Facts..Part 1
July 1, 2009 | Tagged Florida Short Sales, foreclosure alternatives, how to do a short sale in Palm Beach County, Palm Beach Gardens Short Sales, short sale help, short sale irs, short sale myths, short sale realtor, short sale scams, short sale tips | Leave a Comment
As real estate values have dropped over the last couple of years, drastically in some places, thousands of home owners have found themselves either upside down on their mortgage, unable to afford their payments, or both.
The topic of short sales and foreclosures seem to dominate the headlines everywhere. There has been a lot written about short sales and whether you should or shouldn’t short sale your home if you’re in this situation. This has led to many misconceptions about short selling your home.
This series is about the myths regarding short sales. Caveat: The rules regarding short sales are different for every lender and are changing all the time as the market changes. ALWAYS consult a real estate attorney and a CPA regarding the particulars of short selling.
Short sale Myth #1:
You need to be behind in your payments before the lender with consider a short sale.
Fact:
This may have true in the past, but today the key phrase is hardship. Certainly being behind in payments is the most common type of hardship. But hardship could also be caused by job loss, death in the family, divorce, adjustable rate mortgage hike, loss of property value (especially in places like California, Arizona, Nevada and Florida).
If you are considering a short sale make sure you also consult with a licensed Realtor(r) who specializes in short sales. In the Palm Beach County area, especially in Palm Beach Gardens, West Palm Beach and Jupiter, Forbes Realty of South Florida is focused on short sales and helping homeowners through the process.
Rodney Forbes, broker for Forbes Realty, has also co-authored the book “Should I Short Sale My Home?”. Click her for your FREE copy.
Watch for the next article in the Short Sale Myths series. Or, just subscribe to the blog and they will be sent automatically.
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc. Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
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New Twist on First Time Home Buyer Tax Credit
June 30, 2009 | Tagged $8000 tax credit, down payment assistance, first time home buyer, Florida Short Sales, how to do a short sale in Palm Beach County, palm beach gardens foreclosures, palm beach gardens real estate, palm beach gardens realtor, Palm Beach Gardens Short Sales | Leave a Comment
For many first time home buyers in Palm Beach County and the surrounding areas, low home prices from bank owned foreclosure and short sales coupled with low interest rates don’t help much if they don’t have enough up front money for down payment and closing costs.
The new twist on the $8000 Federal Tax Credit for first time home buyers is the ability to use the credit for up front costs, instead of having to wait until closing and filing tax returns.
This is welcome news to many potential home buyers who have the credit to qualify and some funds, just not enough saved. The program will go into effect in Florida on July 1st.
The following is an excerpt from the Orlando Sentinel
Starting Wednesday, Florida hopes to stoke its real-estate market by becoming one of the few states to offer $8,000 in down-payment assistance to qualified homebuyers so they can benefit upfront from a new federal tax credit.
The state Legislature set aside $30 million to create the Florida Homebuyer Opportunity Program, aimed at first-time buyers and others who have not owned a home for at least the past three years. To qualify, an individual cannot earn more than $75,000 a year, while couples can’t earn more than $150,000.
“Here in Florida, rather than qualified buyers waiting to get the tax credit on the tail end of the process, in the form of a credit after they have filed the tax returns, it will allow them to get it upfront and let them use it for down-payment assistance and fees,” said David Hart, vice president of legislative and government affairs for the Florida Home Builders Association. He estimated that about five states are taking a similar approach.
The state’s program takes effect Wednesday, though the money isn’t expected to be available until later in July or August. The funds are being distributed through local government and nonprofit agencies that already provide down-payment help through the State Housing Initiatives Partnership, known as SHIP. Qualified homebuyers are entitled to $8,000 or 10percent of the property’s purchase price, whichever is less.
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc. Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
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$8,000 Tax Credit Expires December 1st
June 30, 2009 | Tagged $8000 tax credit, Add new tag, buy a short sale home, Florida Short Sales, palm beach gardens first time home buyers, palm beach gardens foreclosures, palm beach gardens real estate, palm beach gardens realtor, Palm Beach Gardens Short Sales | Leave a Comment
The following article gives some answers to basic questions as well as the most important answer for most, the expiration date.
According to Keystone Custom Homes, first-time buyers need to be aware that the tax credit is only available now until Dec. 1, 2009 on a closed home purchase. There are other aspects of the tax credit that are important to first-time home buyers, including:
– The tax credit is not a deduction. “It’s much better than that,” says Wisdom. With a deduction, you can only write off the deduction against your total income. So if you make $60,000, you can only reduce your total income by the amount of the deduction, which really isn’t that much savings. For instance, if you have an $8,000 deduction and earn $60,000, you still have pay taxes on $52,000. That’s not much of a savings. But the $8,000 First-Time home buyer tax credit is dollar for dollar. “So you actually reduce your tax payment by the amount of the credit. For instance, if next year, you go to file your taxes and learn that you owe nothing to the IRS, you will receive a check back for $8,000!” says Wisdom.
– First-time home buyers can receive a short-term loan to use the tax credit toward a down payment. In late May 2009, the Federal Housing Administration announced that it will allow eligible first-time home buyers to apply the $8,000 first-time home buyer tax credit to a down payment on a home. This can be done through no-interest loans now available through FHA-approved lenders in the Commonwealth. The loans must be paid back using the tax credit, which is applied to a home buyer’s 2009 tax return. First time home buyers can learn more about this opportunity by talking to their FHA-approved lender or mortgage broker.
For Florida, governor Charlie Crist approved the program as of July 1st. The details of who will administer the program are not clear. The program may be run by the Florida SHIP program.
– The first-time home buyer tax credit is available even if you make good money. The tax credit is available to single first-time home buyers who make less than $75,000 a year or couples who make less than $150,000 a year. “That income covers a lot of Americans,” says Wisdom. “And it’s also based on adjusted gross income. So if you make more than those limits, but deductions reduce your income to those limits, you still might be eligible for the tax credit or a good portion of it.”
– There are ways to receive your tax credit now without applying for a loan. First-time home buyers in essence can gain the benefit of the up to $8,000 tax credit this year by reducing their income withholdings to the amount of the credit. This will allow you to see more cash in your take home pay. And that’s money can then be used toward a down payment or for moving and other costs related to owning a brand new home.
If you have recently closed on a home and plan to use the tax credit, you can also file an amended return for your 2008 taxes and get the tax credit now. Discuss this with your accountant or CPA.
“Obviously, a first-time home buyer should check with their accountant before making any assumptions,” says Wisdom. “But right now, we are seeing record traffic at many of our 24 communities, and much of their interest is due to exceptionally low prices coupled with the Federal Tax credit. Add that to the fact that interest rates, while beginning to rise, are still at near-historic lows, and the combination of these factors makes it the best time in generations to buy a first home.”
Source: Market Watch
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc. Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
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Short Sale Myths and Misconceptions Part 1
June 3, 2009 | Tagged Florida Short Sales, foreclosure alternatives, how to do a short sale in Palm Beach County, mortgage crisis, palm beach gardens first time home buyers, palm beach gardens foreclosures, palm beach gardens loan modificatio, palm beach gardens real estate, Palm Beach Gardens Short Sales, short sale help, short sale irs, short sale math, short sale myths, short sale realtor, short sale tips | Leave a Comment
The following is an article from The South Florida Real Estate Report.
As real estate values have dropped over the last couple of years, drastically in some places, thousands of home owners have found themselves either upside down on their mortgage, unable to afford their payments, or both.
The topic of short sales and foreclosures seem to dominate the headlines everywhere. There has been a lot written about short sales and whether you should or shouldn’t short sale your home if you’re in this situation. This has led to many misconceptions about short selling your home.
This series is about the myths regarding short sales. Caveat: The rules regarding short sales are different for every lender and are changing all the time as the market changes. ALWAYS consult a real estate attorney and a CPA regarding the particulars of short selling.
Short sale Myth #1:
You need to be behind in your payments before the lender with consider a short sale.
Fact:
This may have true in the past, but today the key phrase is hardship. Certainly being behind in payments is the most common type of hardship. But hardship could also be caused by job loss, death in the family, divorce, adjustable rate mortgage hike, loss of property value (especially in places like California, Arizona, Nevada and Florida).
If you are considering a short sale make sure you also consult with a licensed Realtor(r) who specializes in short sales. In the Palm Beach County area, especially in Palm Beach Gardens, West Palm Beach and Jupiter, Forbes Realty of South Florida is focused on short sales and helping homeowners through the process.
Rodney Forbes, broker for Forbes Realty, has also co-authored the book “Should I Short Sale My Home?”. Click her for your FREE copy.
Watch for the next article in the Short Sale Myths series. Or, just subscribe to the blog and they will be sent automatically.
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc. Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
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Real Estate Market Weak Until 2010?
June 2, 2009 | Tagged $8000 tax credit, Florida real estate, home buyer tips, how to do a short sale in Palm Beach County, mortgage crisis, palm beach gardens first time home buyers, palm beach gardens foreclosures, palm beach gardens real estate, Palm Beach Gardens Short Sales | Leave a Comment
Good article from Housing Wire
The housing market may not stabilize until Q111, the Mortgage Bankers Association said today, upon release of its National Delinquency Survey, which shows foreclosure activity hit an all-time high in Q109.
The MBA is now in its 40th year of releasing the survey. Earlier predictions pointed towards a housing market recovery happening sooner, but the MBA says this is unlikely until at least the end of 2010.
The survey shows the delinquency rate — which excludes those homes in the foreclosure process — on one- to four-unit residential properties hit 9.12% in Q109. In Q408, the delinquency rate sat at a much lesser 7.88%.
Twelve percent of all mortgages are now at least one payment delinquent, the MBA said in a conference call.
The ongoing severity of the housing slump is demonstrated in the “seriously delinquent” rate — the percentage of loans that are 90 days or more delinquent — which sat at 7.24%, according to the MBA. That’s 94 basis points higher than Q408 and an astounding 321 points higher than last year at the same time.
Total foreclosure inventory was also up, with 3.85% of all mortgages somewhere in the foreclosure process at the end of Q109, compared with 3.3% in Q408.
Not only has foreclosure activity surged, it’s become more widespread, as prime, fixed-rate mortgages now constitute 56% of mortgages in the foreclosure process.
The transient nature of the market, where people are relocating to new towns for new jobs and turning over home keys time and time again, must settle, before the housing market can begin a solid recovery, the MBA explained.
Which means, the job market must take a turn in the right direction, before housing can do the same, which the MBA predicts will come in the first half of 2010.
Write to Kelly Curran.
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Mortgage Crisis Spreads
June 2, 2009 | Tagged $8000 tax credit, home buyer tips, how to do a short sale in Palm Beach County, mortgage crisis, palm beach gardens first time home buyers, palm beach gardens foreclosures, palm beach gardens loan modificatio, palm beach gardens real estate, palm beach gardens realtor, Palm Beach Gardens Short Sales, short sale irs, short sale tips | Leave a Comment
Until now most people had assumed the mortgage crisis only had to do with people who bought over valued homes with sub-prime loans. Due to the slow down in the economy and large companies going bankrupt, the mortgage crisis is spreading to people who were once considered “safe” borrowers.
The mortgage crisis is spreading and hitting new heights: Borrowers with good credit now make up the largest share of foreclosures as job losses and pay cuts exact their toll.
A record 12 percent of homeowners with a mortgage were behind on their payments in the first quarter, the Mortgage Bankers Association reported Thursday. And the trend is predicted to continue until the end of next year, about six months after unemployment is expected to peak.
The genesis of the recession — risky adjustable-rate loans made to borrowers with bad credit — remains a significant factor in foreclosures. Today, almost half of all subprime ARMs are past due or in foreclosure. In Florida, New Jersey and New York the number is above 55 percent.
When those borrowers started defaulting in droves in late 2006, it forced dozens of lenders out of business and sparked a credit crisis in the summer of 2007. Businesses nationwide couldn’t get short-term loans to finance new orders or even cover their payrolls. Economic production began shrinking at the end of 2007 in what has become the longest recession in the United States since World War II.
The impact has now filtered out, consuming homeowners who until recently had a good track record of paying their bills on time. Nearly 6 percent of these prime borrowers with fixed-rate mortgages were past due or in foreclosure, nearly doubling in the past year.
“These (borrowers) are the best of the best out there,” said real estate analyst Mike Larson with Weiss Research in Jupiter, Fla. “Clearly, borrowers far and wide are getting hit by this.”
The worst of the trouble continues to be focused in California, Nevada, Arizona and Florida, which accounted for 46 percent of new foreclosures in the country and reported the worst delinquency and foreclosure rates on prime fixed-rate loans. The four have suffered massive job cuts in the housing industry. There were no signs of improvement.
But experts expect the pain to spread throughout the country as job losses mount. MBA’s chief economist Jay Brinkmann estimates the unemployment rate will top out in mid-2010 and foreclosures will abate about six months afterward.
The number of newly laid off people requesting jobless benefits fell last week, the government reported Thursday, but the number of people receiving unemployment benefits reached 6.78 million in mid-May, the highest on record.
The continuing rise in unemployment, which economists say could reach double digits, means more trouble for the ailing financial system and the economy. Lower incomes and lost jobs are the No. 1 reason people lose their homes through foreclosure. Higher unemployment also means people have less money to spend on basic necessities, let alone luxuries.
And borrowers without jobs are harder for lenders to help with loan modifications.
Nadine Harris in Bakersfield is hoping to modify her 30-year fixed-rate mortgage under President Barack Obama’s loan modification and refinancing program introduced earlier this year.
The 55-year-old was laid off two years ago by Sears after working there 34 years. Harris found another job, but she makes $20,000 less a year. The $925 she takes home every two weeks doesn’t cover her $1,522 mortgage and other living expenses. She’s used all her savings to stay current on her payments, but next month the reserves will run dry.
“I’ll have to scrimp to make up the payment in June,” she said.
Jodi Woodsmith, a housing counselor at Self-Help Enterprises in Visalia said that in the last eight weeks she’s seen more and more homeowners with similar stories walk through her door.
“Those who had savings, they’ve exhausted their savings hoping they could ride it out,” she said.
Woodsmith said a recent change to the president’s program allows borrowers to use unemployment benefits as a source of income for a loan modification. Income from spouses who are not on the mortgage also is taken into account.
Though the plan might stem some foreclosures, it might not be enough to significantly alter the crisis.
“It may be too much to say that the numbers will fall because of the plan,” Brinkmann said. “It’s more correct to say that the numbers won’t be as high.”
Source: Tim and Julie Harris
If the trend continues, the opportunity for bottom basement priced housing will continue for qualified buyers. The government will work to keep interest rates low and the tax credits for home buying will probablybe expanded.
If you are interested in buying or selling a home in the Palm Beach County area, specifically Palm Beach Gardens, Jupiter and West Palm Beach, please visit my Forbes Realty website. For frequently updated information on foreclosures, short sales, real estate news and market conditions visit my South Florida Real Estate Report blog. There are many free reports as well as free access to MLS listed properties. You can also call 561-337-4810.
Rodney Forbes is a licensed Realtor®, certified short sale/REO specialist and broker for Forbes Realty of South Florida Inc. Rodney has co-authored the book “Should I Short Sale My Home?”. Get your FREE copy at www.SouthFloridaRealEstateReport.com
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