North Atlana and North Georgia Real Estate

Every buyer I am working with starts out wanting to only look at short sale or foreclosure listings. They want to get the best deal they can and I understand and respect that. But sometimes the short sale or foreclosure isn’t the best deal. There are a lot of factors that you need to go through and I want to go over some of them right now.

The biggest factor to take into consideration is “Total Cost of Ownership” (TCO). Let’s say there are 3 homes in the same neighborhood. All of them are equal in size and number of bedrooms. They all have the things you are looking for but have 3 different prices.

Home A is a typical resale home. The owners are living in it, but are relocating to another area or want to upgrade or downsize. They are asking $195,000.00.

Home B is a short sale. The owners have fallen behind in the mortgage and don’t see a way to catch up. They are trying to avoid foreclosure by putting the home on the market to try and sell it for less than they owe, in hopes that the bank will work with them. They are asking $185,000.00.

Home C is a foreclosure. The bank has already taken the home back and now they need to get rid of it. They are asking $180,000.00.

At first glance, the foreclosure home is the best deal. In some cases it might be, but that isn’t always going to be the case. You need to compare all three homes and see what needs to be done in order to live in the house and be comfortable.

It is very common to see foreclosure homes that are in need of extensive repairs. Quite often they will be missing appliances and light fixtures. When a bank tales over a home, they will put some effort into cleaning it up. You can expect a fresh coat of paint, drywall repair and possibly even to have the carpets replaced.

Short sales can also need work. The bank hasn’t taken it over yet, so it is dependant on the home owner. Many homes that are on the market as a short sale are in good condition for the age and area. It is quite possible to find a short sale that needs only to have the carpets cleaned and paint touched up. But it is also possible that the people that are loosing the house could be at the point of blaming the mortgage company. If that is the case, you can expect to see some hefty repair work done. I’ve seen short sale homes that were basically just a shell of a house. The drywall and carpet were there, but the appliances were gone and so were the cabinets.

I’m not saying that the typical resale home is going to be the best deal. That home may still need quite a bit of work. The house could need a fresh coat of paint and the carpets might need to be replaced. In a typical resale home though, you can use those to negotiate the final sales price.

Another factor you have to take into consideration is timing. If you need to close on a home within a 60-90 day window, then a short sale is likely not an option. Even if the listing says “short sale approved” the mortgage company will not be able to get things together in time to close in less than 60 days.

The answer to the question of what are the best deals is that it depends. The only way you are going to make sure you get the best deal for you is to make sure you look at all of the options. Don’t go into the home buying process thinking you have to buy a foreclosure or a short sale in order to get the best deal.

Yes, you may typically pay a little more for a typical resale on the sales price. But you have to look at the Total Cost of Ownership. What will it cost to bring each home to an acceptable standard for you?

The clock is starting to tick rather loudly on the expiration of the housing tax credits! You have to close on a home by December 1^st 2009 in order to get the $8,000 first time home buyers tax credit.

Yes, that is 5 months away but, you have to close by then, not be under contract. Depending on your loan program, that could take 30-45 days. Which brings it down to less than 3 months to find and negotiate on the home.

We also don’t know what it is going to be like as that expiration dater gets closer. Are people going to get off the fence and start buying homes? If so, that could lengthen the time it takes to close on a home as all of the parties involved, from the appraisers to the mortgage companies are going to be busy.

What about interest rates? While nobody can detect what they are going to do in the next few months, right now they are rising slightly. If the mortgage companies start to see a lot of activity, that could very well push them up higher.

I’m not trying to create panic and fear in your mind. I’m trying to help you think through the process. If you are well qualified and ready to buy, the benefits to buying now are better than they have been. There are tax credits and buyer programs that can give up to $23,800 when you buy a home. These programs do have special criteria and qualifications.

Are you ready? Call me at 678-907-0627 and let’s get the ball rolling. I’ll explain the different programs available for the credits and help get you pre-qualified. Buying a home is a smart thing to do as long as you are ready willing and able!

When your facing foreclosure, or struggling to pay the bills every month, life isn't very fun. While it seems that there is no light at the end of the tunnel for the current economic situation, there are very positive signs that we can see a light at the end of the tunnel.

One of the many government bailout programs (the only one that has any common sense to it at all) is finally starting to be rolled out. The "making home affordable" program has been released and mortgage servicers are beginning to work with it. To see if this program will help you visit http://makinghomeaffordable.gov/ and answer a few simple questions. Just because the sight says you may qualify, doesn't mean you will. You need to follow the steps and contact the proper people to get the help needed. This program is new, so they will be slow to respond in the beginning and we have to wait and see how effective it will be.

Even if you don't qualify, contact your mortgage company as soon as you see the threat of falling behind. I understand how difficult those conversations are but the sooner you make the call, the easier it will be for them to work with you.

If you are already behind and have been avoiding those calls, call them now. If you wait too long, they will not be able to help you.

If you are in need of help, or have any questions, feel free to email me and I'll do my best to point you in the right direction. If you are local we can meet one on one and if you aren't, I have a network of people across the country that will assist you at no cost to you.

The new home buyer tax credit has people talking and asking questions. While it is important to check with a tax professional to make sure you qualify, I wanted to answer some of the common questions:

1. Is this home buyer tax credit available only to first time home buyers? The short answer is No. For the purposes of this tax credit, the government considers you a first time home buyer if you have not had an ownership interest in a home in the last 3 years.
2. Can I use the tax credit as a down payment for my home? Not really. This is a tax credit, which will be given to you when you file you taxes for the year you claim it in. If you have already filed your 2008 taxes, you can amend them after you buy a home to claim the credit this year if you want.
3. Do I have to pay it back? For the most part, this is a credit that is free and clear. However, there are penalties in place that would require you to pay it back if you sold the home or moved out of it within three years. Some exceptions may apply though.
4. Are there income limits to getting the tax credit? Yes, the credit begins to phase out at pre-set income levels and goes away at a pre-set level. These levels will vary based on your income situation.

The most important question I am getting is, “Should I buy now just to get this credit?” You should buy a home if you have the ability to get financing that will allow you to maintain you monthly budget, plan on staying in the same home for at least 5 years and have the desire to build equity in something you own instead of paying rent.

My personal view on this tax credit is that it is a great thing to have and I look at it as a bonus. If I were on the fence of buying or was planning to buy when home prices hit the bottom, I would take advantage of this and buy now.

I am not now, nor have I ever been, a tax guy. To make sure you understand this tax credit and if it will apply to you, please consult a tax professional.