The Tax Credit is gone so what now.  There are plenty of reasons to buy a home now (even without the tax credit).  The number one reason is that rates are still at historic lows.  Mortgage Interest rates continue to hover at 5%.  

Rates are still low – Just some interesting insight:

Let’s take a $200,000 mortgage:

Rates now around 5.00% - P & I Payment is $1,074

Rates increase to around 6.00% - P & I Payment is $1,199

Monthly savings is $125!  That’s over $45,000 saved over the life of the loan.  Wow!!

Rates increase to around 7.5% - P & I Payment is $1398

Monthly savings is $324!  That’s $117,000 saved over the life of the loan compared to 5%.  Wow!!

So, if you want to keep a payment of $1074 per month with the higher interest rates you will be limited to purchasing a home at $150,000.  That’s a big difference. 

Yes, the $8,000 tax credit was a great incentive for borrowers, but the math doesn’t lie if you take time to analyze it.   It was only a short few years ago that interest rates were between 6.5% and 7.5% and we thought they were good then.  But interest rates are predicted to rise to that again.

If you have any questions regarding your options, call TEAM DECELL at 214-975-3210.

Mistake #1:  Choosing a real estate agent who is not committed to forming a strong business relationship with you.

            Avoid it:  Making a connection with the right real estate agent is crucial.  Choose a professional who is dedicated to serving your needs – before during and after the sale.  Make sure that they are full time agents not part time.  Part time agents will end up losing you money or worse messing up the deal because of their inexperience or have to work their other job.

Mistake #2:  Making an offer on a home without being pre-qualified.

            Avoid it:  Pre-qualification will make your life easier – take the time to talk with a bank or mortgage representative.  Their specific questions with regard to income, debt, and other factors will help you determine the price range that you can afford.  Also, this step will help your real estate agent determine how long it will take to go from writing a contract to closing on your new home.  It is one of the most important steps that you can take.

Mistake #3:  Not knowing the total cost involved.

            Avoid it:  Early in the buying process, ask your real estate agent or mortgage representative for an estimate of closing costs.  Title insurance and lawyer fees should be considered.  Pre-pay responsibilities such as homeowner’s association fees and insurance must also be taken into account.  Remember to examine your settlement statement prior to closing.

Mistake #4:  Limiting your search to open houses, ads or the internet.

            Avoid it:  Many homes listed in magazines or on the Internet have already been sold.  Your best course of action is to contact a real estate agent.  They have up-to-date information that is unavailable to the general public, and they are the best resource to help you find the home you want. 

Mistake #5:  Thinking that there is only one perfect home out there.

            Avoid it:  Buying a home is a process of elimination, not selection.  New properties arrive on the market daily, so be open to all possibilities.  Ask your real estate agent for a comparative market analysis.  This compares similar homes that have recently sold or are still for sale.

Mistake #6:  Not considering long-term needs.

            Avoid it:  It is important to think ahead.  Will your home suit your needs 3-5 years from now? How about in 5-10 years?

Mistake #7:  Not following through on due diligence.

            Avoid it:  Make a list of any concerns you have relating to issues such as crime rates, schools, power lines, neighbors, environmental conditions, etc.  Ask the important questions before you make an offer on a home.

Mistake #8:  Not having a home inspection.

            Avoid it:  Trying to save money today can end up costing you tomorrow.  A qualified home inspector will detect issues that many buyers can overlook.

Mistake #9:  Not examining insurance issues.

            Avoid it:  Purchase adequate insurance.  Advice from an insurance agent can provide you with answers to any concerns you may have.  Like the deductibles for wind and hail etc.

Mistake #10:  Not purchasing a home protection plan.

            Avoid it:  This is essentially a mini insurance policy that lasts about one year from the date of sale.  It typically covers basis repairs you may encounter.  A/C service plumbing issues etc.

If you have any questions please contact Team Decell your neighborhood realtors.  214.975.3210

Should I buy a Foreclosure, Short Sale or Wait for a good deal?

Frisco currently has 948 homes for sale in Frisco in both the Denton County and Collin County.  There are 31 homes for sale in Frisco that came on the market for sale yesterday, some of which are a great deal.  These Frisco Homes are Foreclosures, Short Sales and Privately owned homes.  Some are good deals and some are not. 

If you are a buyer looking for a good deal then you should be patient but be able to act quickly.  For example 12235 Red Hawk DR in Grayhawk is priced at $161K and is 2100 square feet and 10465 Hay Meadow DR in Meadow Hill Estates is 3390 square feet and is prices at $241K both are good deals for Frisco.  But because they are good deals they won’t last long.  Another example of a good deal is 11857 Stephenville in Panther Creek of Frisco this home is a Short Sale.

Buyers should use a website to search for properties that updates daily and also don’t have homes that have already sold on them; www.teamdecell.com is a great site for that.  You need a website that updates daily because as I mentioned on good deals the buyer will need to act quickly, and if a website doesn’t update daily then when you finally see the home it may be a week old and have multiple contracts on it.

In shopping for Foreclosures Homes, also know as Bank Owned properties, Short Sales and the other homes in Frisco that are good deals, something else to consider is your real estate agent.  Does your agent have a strategy when it comes to submitting an offer on Foreclosures, Short Sale or a good deal?  There are a number of things your agent can do to help insure that your offer is the accepted offer. Talk with them and find out what and how they plan on ensuring your offer doesn’t get beat out by another offer.

Short Sale properties are in a class of their own.  They are not short in regards to duration but they are short because the sale price will be short of the payoff or loan amount.  Here again make sure your agent has a lot of experience in selling and listing short sales.  If your agent has list numerous short sales then he will know what goes on behind the scenes with the bank approval process and will be able to guide you properly.  Many real estate agents that only represent buyers don’t fully understand the process and how it works; this lack of knowledge will be to your detriment and a large waste of time.  As I mentioned 11857 Stephenville in Panther Creek of Frisco is a short sale that just came on the market.  The Listing agents’ goal is to get an offer as quick as possible to stop any Foreclosure preceding that might have started.  But many agents don’t realize that the offer submitted is a fully executed offer to purchase the property and that the listing agent can only accept one fully executed contract on the property.  You can have a back up contract but your agent will let you know that and you will sign a form saying that you acknowledge that this is a back up contract.  So all that to say if your not the execute contract you may be just another contract in a pile of other contracts that the listing agent has on his desk.  TEAM DECELL has a great deal of experience in short sales both on the listing side and the buyer’s side. 

This article is not meant to say that TEAM DECELL are the only capable realtors in the market place, because that is not true.  We have worked a lot of great agents over the years.  This article is meant to give you knowledge so that you can make a qualified decision regarding the realtor that you do use.  Make sure they are experienced in all aspects of the real estate industry, make sure they are full time agents, you don’t want to work with someone that only works the business for play money or because they are bored.  Full time agents are dedicated to their business because it’s their livelihood.  They want to earn your future business and the business of your friends and family, so they will want to do a great job for you.

If you would like additional information about what we have talked about in this article contact TEAM DECELL at our website or call 214-975-3210.  We are a team of 5 agents with an assistant.  We will make your next buying or selling experience a pleasant one. 

There are a number of personal and emotional reasons to buy a home. But there are also some strong financial reasons to make the investment. Here are just a few of those reasons:

Increase Net Worth: Few things have a greater impact on net worth than owning a home. In a comparison of renters versus homeowners, the Federal Reserve Board of Consumer Finance found that the average net worth of renters was just $4,000 compared to homeowners at $184,400.

A Big Tax Deduction: One of the largest tax deductions available is the amount of interest paid on a mortgage. In fact, a $150,000 home at a 5.50% interest rate can add up to approximately $8,000 in first year’s interest. This amounts to a significant savings – effectively reducing the amount of a homeowner’s monthly mortgage payment.

Long-Term Appreciation: Over the last few years, home prices have corrected and become more affordable. While that’s good news for potential home buyers, it has overshadowed the long-term appreciation of a home’s value. The reality is, despite market ups and downs between 1950 and 2002, US home prices appreciated at an annual growth rate of 4.8%. Even if you calculate a modest appreciation of 3%, a home purchased today for $150,000 will grow in value to $364,000 over 30 years.

In addition, don’t forget that the government is offering an $8,000 tax credit for first-time buyers and a $6500 Step-Up Buyers through June 30, 2010.

If you are interested in talking to someone about your options please call us.  If you are interested in homes for sale in Frisco,  Plano,  Allen and  in McKinney area TEAMDECELL is who you need to call.  TEAMDECELL sells homes in the Frisco, Plano, Allen and McKinney Area primarily.  We also assist our clients with New Construction as well.  We are your home town experts and offer excellent customer service.  214-975-3210

“You can claim the credit on your 2009 tax return as long as you have a binding contract by the end of April and you close by the end of June,” said Neil Allen, spokesman for CCH, which provides tax and accounting software and services for tax professionals.

If you file your return before you close on the purchase, you can file an amended return to claim the credit.

The program was expanded to include up to a $6,500 tax credit for existing homeowners wanting to move up to a new home, as long as they have lived in their current residence for five consecutive years out of the last eight.

The new portion of the bill that gives $6500 for existing Homeowners who will upgrade their home will be a definite boast in the Frisco Real Estate Market.  Many people who were going to sit and wait will now jump in.  Even if the home that your purchasing is a foreclosure, as long asa it is a move up, it qualifies.

To find out your options contact TEAM DECELL your local real estate experts.  We seek to help our buyers and sellers make good informed decisions.  Buying, Selling, Foreclosures or Short Sales we can help you.

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 first-time homebuyers 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 home 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 tax 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 tax 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 home 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.

To speak with a Real Estate Professional contact TEAM DECELL 214-975-3210.

TAX CREDIT FACTS

President has signed the bill !!!!

$8000 for first time owner

$6500 for current owner of 5 years

Must have contract by April 30th

Close by June 30th

For more information contact TEAM DECELL 214-975-3210

Top Democrats in the Senate are pressing a plan that would extend a popular tax credit for first-time homebuyers but gradually phase it out over the course of next year.

The proposal, by Majority Leader Harry Reid, D-Nev., and Senate Finance Committee Chairman Max Baucus, D-Mont., would extend the $8,000 tax credit — which expires Nov. 30 — through March 31. Its value would drop by $2,000 for each of the subsequent three quarters of 2010.

The plan, which could face a vote in the Senate this week, appears aimed at countering a far more generous $17 billion bipartisan plan that would extend the $8,000 credit through June 30, 2010, boost the income cap for eligibility and open the credit to all buyers, rather than first-timers.

This information is brought to you by TEAMDECELL.

Treasuries and mortgage rates are presently stuck in a very narrow range; the 10 yr stuck and unable to sustain under 3.50% and mortgage rates stuck in a 10 basis point range. Mortgage prices are trading above their key moving averages while the 10 yr note still holds its key averages. We expect a nice move lower in the rate markets in Sept; the timing based on when we get that long awaited equity market pullback—-and we will see it. The higher up the ladder, the bigger the fall. To finally trigger the start will take a market wake up call, so far that hasn’t happened, many professional traders are being hammered trying to short the stock market. 

All in all watch for rates to drop in September, possible below 5%, but you need to be ready to act fast.  Your mortgage person will be able to assist you.  You will need to have everything already approved but not locked in.  If you need a good lender call and I will help direct you.

If you are interested in refinancing your current home or homes for sale in Frisco, homes for sale in Plano, homes for sale Allen and homes for sale in McKinney area TEAMDECELL is who you need to call.  TEAMDECELL sells homes in the Frisco, Plano, Allen and McKinney Area primarily.  They are your home town experts and offer excellent customer service.  214-975-3210