Go To HUD's website pdf http://www.hud.gov/offices/hsg/sfh/waivpropflip2010.pdf

Copied from HUDS website:

6. FHA finds that eliminating the 90-day resale restriction for buyers will give FHA a greater opportunity to dispose of its single family REO properties in a way that maximizes return to the FHA mortgage insurance fund, also, permitting buyers to use FHA-insured financing to purchase other bank-owned properties, or properties sold through PRIVATE Sales for RESALE, will help create market conditions that will allow homes to resell as quickly as possible, thus helping to stabilize real estate prices as well as helping to stabilize neighborhoods and communities where foreclosure activity has been high.

7. HUD REO, many bank-owned properties, and properties sold through private sales are often sold in an 'as is' state, without repairs or warranties.  Many of these homes require repairs and are purchased by buyers with the financial means and necessary resources to complete needed rehabilitation work and return the homes to the market at fair market prices.

8. Acquiring, rehabilitating and then reselling these properties to prospective homeowners takes less than 90 days.  Prohibiting the use of FHA mortgage insurance for a subsequent sale within 90days of acquisition ADVERSELY impacts the willingness of purchasers to bid on these properties, as these potential buyers need to consider holding costs associated with the purchase, along with the risk of vandalism associated with allowing a property to sit vacant over a 90-day period of time.  Thus, the 90-day resale restriction often HINDERS community stabilization and revitilization.

9. As a result of the currently tightened credit market, FHA-insured mortgage financing is often the only means of financing available to potential homebuyers.  FHA has an unprecedented opportunity to fulfill its mission by helping many homebuyers find affordable housing while contributing to the stabilization of neighborhoods and communities.

DETERMINATION

1. To help facilitate the return of repaired and habitable properties to the market in a timely fashion, additonal expemptions to the 90-day resale restriction period must be granted for the purchase of properties by INVESTORS.  This policy change WILL HELP to SELL properties that may otherwise remain vacant for up to 90 days, while offering affordable housing options to buyers wishing to use FHA-insured financing.

2. etc , etc. http://www.hud.gov/offices/hsg/sfh/waivpropflip2010.pdf

I'm a CDPE!  What the heck is a CDPE?!?

I'm a Certified Distressed Property Expert (CDPE).  I'm a real estate professional with specific understandings of the complex issues confronting the real estate industry.  Through comprehensive training and experience, CDPEs are able to provide solutions for homeowners facing hardships in today's market, regarding Short Sales, Pre-Foreclosure and Foreclosures.

The prospect of foreclosure can be financially and emotionally devastating, and often homeowners proceed without guidance of any kind.  The developers of the CDPE Designation believe that in almost all cases, the best course of action for a homeowner in distress is to speak with a well-informed, licensed real estate professional.  Not just someone with a real estate license, but someone who is a REALTOR and is a member of the National Association of Realtors (N.A.R.), the California Association of Realtors (C.A.R.) and their local board of Realtors.  They have the tools needed to help homeowners find the best solution for their situation.

While enduring financial difficulties are challenging for any family, the process of finding a real estate professional should Not be.  Selecting an agent with the CDPE designation ensures you are dealing with a professional trained to address your specific needs.  For more information, check out CDPE.com.

CDPE's don't merely assist in selling properties, they serve and help save their clients in need.

Chris Bedgood is a CDPE in San Diego and is a proud member of the metro San Diego community.  He is a Realtor and is member of N.A.R., and C.A.R. as well as the San Diego Assocation of Realtors (SDAR).  License #01380111.  www.ChrisBedgood.com and www.SanDiegoIsOnSale.com

From California Association of Realtors website www.car.org - California Department of Real Estate News Release (June 22, 2009)

The California Real Estate Commissioner, Jeff Davi, announced today the issuance of a Consumer Alert by the California Department of Real Estate (DRE) warning consumers about loan modification scams and informing consumers of what they can do to protect themselves. The alert has been posted on DRE’s Web site at: http://www.dre.ca.gov/pdf_docs/FraudWarningsCaDRE03_2009.pdf  and is also available in Spanish.

Loan modification scams are worrisome and widespread. July 2008, the DRE had fewer than 10 complaints involving loan modification companies; today the department has 750 pending investigations. In addition, since last October the DRE has filed over 200 Desist and Refrain Orders and Accusations involving loan modification scams and the list of offenders continues to grow. A list of the companies and persons the DRE has filed an action against can be viewed at http://www.dre.ca.gov/cons_drs.asp.

The New buzzwords in town, "SHORT SALE"  What is one, and what does a short sale mean to you?  Below are some commonly asked questions about Short Sales. 

1.What is a short sale?

A short sale is a transaction in which the lender, or lenders, agree to accept less than the mortgage amount owed by the current homeowner. In some cases, the difference is forgiven by the lender, and in others the homeowner must make arrangements with the lender to settle the remainder of the debt.

2. What if there are two mortgages on my property?

In order for the short sale to go through both lenders must approve of accepting a lower amount for the loan.  If the home goes into foreclosure the second lender will normally get nothing, so they are very motivated to work with the lender of the first loan.  These loans can be done, but they take knowledge and expertise.  Weichert Elite and Chris Bedgood's team will bring that knowledge and expertise to help move the short sale process forward and get results in a timely manner.

3. Why should I choose a Realtor that specializes in short sales as opposed to a investor who wants to purchase my property and negotiate the short sale?

Watch out for unethical investors who will try to convince an owner facing foreclosure to sign a quit-claim deed for the property, and then lease the property. In such cases, the former owners will still be liable for the mortgage payments, even though they no longer own the house.  Also, most so-called 'investors' don't know what they are doing and are unlicensed to do real estate, so the end result could be exactly the opposite you were hoping for, which will affect your time and family.

4. What do I need to do in order to prepare for a short sale?

The sellers' submission package should include W-2 forms from employers (or a letter explaining the seller is unemployed), bank statements, two years of tax returns, and other financial documents outlining income and debt obligations. The bank will also need comps (comparable properties) or a broker's price opinion showing your estimate of value.

In addition, the sellers should submit a "hardship letter," explaining the circumstances that make it impossible for them to pay the full amount of the loan. The seller needs to be able to show true financial hardship.

5. Will any money come out of my pocket for a Short Sale as the seller?

Normally, and in 'most' occasions, the lender will pay all fee's.  It is important to have an experienced short sale team act as your negotiator to ensure this happens.  The submission package to the lender just needs to be complete, see above.

DONOVAN ANNOUNCES RECOVERY ACT'S HOMEBUYER TAX CREDIT CAN IMMEDIATELY HELP THOUSANDS OF FIRST-TIME HOMEBUYERS TO BUY A HOME
FHA plan will stimulate new home sales and help stabilize housing market

WASHINGTON - Speaking to the National Association of Home Builders Spring Board of Directors Meeting, U.S. Housing and Urban Development Secretary Shaun Donovan today announced that the Federal Housing Administration (FHA) will allow homebuyers to apply the Obama Administration's new $8,000 first-time homebuyer tax credit toward the purchase costs of a FHA-insured home. Donovan said that today's action will help stabilize the nation's housing market by stimulating home sales across the country.

The American Recovery and Reinvestment Act of 2009 offers homebuyers a tax credit of up to $8,000 for purchasing their first home. Families can only access this credit after filing their tax returns with the IRS. Today's announcement details FHA's rules allowing state Housing Finance Agencies and certain non-profits to "monetize" up to the full amount of the tax credit (depending on the amount of the mortgage) so that borrowers can immediately apply the funds toward their down payments. Home buyers using FHA-approved lenders can apply the tax credit to their down payment in excess of 3.5 percent of appraised value or their closing costs, which can help achieve a lower interest rate. To read the FHA's new mortgagee letter, visit HUD's website.

"We believe this is a real win for everyone," said Donovan. "Today, the Obama Administration is taking another important step toward accelerating the recovery of the nation's housing market. Families will now be able to apply their anticipated tax credit toward their home purchase right away. At the same time we are putting safeguards in place to ensure that consumers will be protected from unscrupulous lenders. What we're doing today will not only help these families to purchase their first home but will present an enormous benefit for communities struggling to deal with an oversupply of housing."

Currently, borrowers applying for an FHA-insured mortgage are required to make a minimum 3.5 percent downpayment on the purchase of their home. Current law does not permit approved lenders to monetize the tax credit to meet the required 3.5 percent minimum down payment, but, under the terms of today's announcement, lenders can now monetize the tax credit for use as additional down payment, or for other closing costs, which can help achieve a lower interest rate. Buyers financing through state Housing Finance Agencies and certain non-profits will be able to use the tax credit for their downpayments via secondary financing provided by the HFA or non-profit. In addition to the borrower's own cash investment, FHA allows parents, employers and other governmental entities to contribute towards the downpayment. Today's action permits the first-time homebuyer's anticipated tax credit under the Recovery Act to be applied toward the family's home purchase right away. Unlike seller-funded down-payment assistance, which was a vehicle for abuse, this program will allow homebuyers to shop for the best home price and services using their anticipated tax credit.

According to estimates by the National Association of Home Builders, the Administration's homebuyer tax credit will stimulate 160,000 home sales across the nation - 101,000 of which will be first-time buyers who will receive the credit. Another 59,000 existing homeowners will be able to buy another home because a first-time buyer purchased their home. Given FHA's current market share, it's estimated that thousands of families will be able to purchase a home by allowing the anticipated tax credit to be applied toward their purchase together with an FHA-insured mortgage.

Homebuyers should beware of mortgage scams and carefully compare benefits and costs when seeking out tax credit monetization services. Programs will vary from organization to organization and borrowers should consider whether the services make sense for them, as well as what company offers the most suitable and affordable option.

For every FHA borrower who is assisted through the tax credit program, FHA will collect the name and employer identification number of the organization providing the service as well as associated fees and charges. FHA will use this information to track the business closely and will refer any questionable practices to the appropriate regulatory agencies, as necessary.

###

HUD is the nation's housing agency committed to sustaining homeownership; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development and enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet at www.hud.gov and espanol.hud.gov.

California Association of Realtors (car.org) $8000 tax credit Q & A:

FIRST-TIME HOMEBUYER TAX CREDIT

Q 1.  What, in a nutshell, is the $8,000 tax credit for first-time homebuyers under the new law? A  A first-time homebuyer as defined may receive a refundable tax credit up to $8,000 for purchasing a principal residence in the U.S. from January 1, 2009 to November 30, 2009, inclusive (see Questions 5 to 16).  No repayment is required if the buyer owns and occupies the property for 36 months (see Question 17).  This new law enhances the preexisting $7,500 tax credit enacted in 2008 which still applies for purchases from April 9, 2008 to December 31, 2008 (see Questions 18 and 19).

Q 2.  How will the new $8,000 tax credit affect REALTORS® and their clients? A  The new $8,000 tax credit provides a monetary incentive for first-time homebuyers to purchase homes.  First time homebuyers represent a significant segment of U.S. homebuyers.  According to the U.S. Department of the Treasury, nearly half of the homebuyers in 2008 were first-time homebuyers.  Hence, the new tax credit for first-time homebuyers, along with affordable home prices and historically low mortgage rates, should help spur the housing market.
 
Q 3.  What is a tax credit? A  A tax credit is a dollar-for-dollar reduction of tax owed.  In contrast to a tax credit, a tax deduction is merely a reduction of taxable income.  Hence, a tax credit is generally more valuable to the taxpayer than a tax deduction.  To illustrate, an $8,000 tax deduction for a taxpayer in a 25% tax bracket would only save the taxpayer $2,000 in taxes, whereas an $8,000 tax credit would save the taxpayer $8,000 in taxes.

Q 4.  What is the significance of a “refundable” tax credit? A  That a tax credit is “refundable” means that any credit amount not used to reduce the tax owed may be added to the taxpayer’s tax refund check.  In other words, a taxpayer may receive a tax credit even if he or she has no tax liability to offset that credit. As an example, let’s say a taxpayer filing his tax returns on April 15 would have owed $2,000 to the IRS.  If the taxpayer can now claim an $8,000 refundable tax credit, he can expect to receive a refund check from the IRS for $6,000.

Q 5.  Who is eligible as a “first-time homebuyer” for the $8,000 tax credit?

A  For purposes of the $8,000 tax credit, a “first-time homebuyer” is defined as any individual (or spouse) with no present ownership interest in a principal residence during the 3-year period ending on the date of the purchase of the principal residence to which the tax credit applies (26 U.S.C. § 36(c)(1)).  For income restrictions, see Question 9. As an example, an unmarried buyer who closes escrow on a purchase on June 30, 2009, would qualify as a “first-time homebuyer” as long as the buyer did not own a principal residence during the period from July 1, 2006 to June 30, 2009.  Even if the taxpayer owned another principal residence in the past, he or she can still qualify as a “first-time homebuyer” as long as the taxpayer transferred off title to that other home over three years ago.

Q 6.  What constitutes a “principal residence” under the $8,000 tax credit? A  A “principal residence” is generally the home the taxpayer lives in most of the time (26 U.S.C. § 121).  It can be a house, condominium, townhome, manufactured home, or similar type of property located in the U.S.  To qualify for the federal $8,000 tax credit, the property can be new construction or a resale.  It cannot, however, be a vacation home or rental property.

Q 7.  What constitutes a “purchase” to be eligible for the $8,000 tax credit? A  A “purchase” for purposes of this tax credit is defined as any acquisition, except as set forth in Question 15 (26 U.S.C. § 36(c)(3)).  For a home that the taxpayer constructs, the purchase date is the date the taxpayer first occupies the home (26 U.S.C. § 36(c)(3)(B)). Because a purchase is defined as an acquisition, it generally occurs when escrow closes and title to the property transfers to the buyer, and not when the underlying purchase contract is signed.  To illustrate, a buyer who enters into a contract to purchase a property on November 13, 2009, but closes escrow on December 23, 2009, would not qualify for the $8,000 tax credit because, based on the law as it is currently written, acquisition does not occur before the law expires on November 30, 2009.

Q 8.  How is the amount of the tax credit calculated? A  The maximum tax credit for an individual first-time homebuyer is 10 percent of the purchase price, not to exceed $8,000 (26 U.S.C. § 36(b)(1)(A)).  For married individuals filing separate tax returns, the tax credit is capped at $4,000 (26 U.S.C. § 36(b)(1)(B)). For a purchase price over $80,000, as is often the case in California, the first-time homebuyer tax credit will be capped off at $8,000.  “Purchase price” under this law is defined as the adjusted basis of the principal residence on the date such residence is purchased (26 U.S.C. § 36(c)(4)).

Q 9. Is there an income restriction to be eligible for the $8,000 tax credit? A  Yes.  The first-time homebuyer tax credit may be restricted by the taxpayer’s income.  The tax credit starts to phase out for an individual taxpayer with a modified adjusted gross income from $75,001 to $95,000 (or $150,001 to $170,000 for joint filers).  The tax credit is eliminated entirely if an individual’s modified adjusted gross income is over $95,000 (or $170,000 for joint filers).  (26 U.S.C. § 36(b)(2).)

Q 10.  What is a modified adjusted gross income? A  First, a modified adjusted gross income or MAGI is a taxpayer’s adjusted gross income (AGI) plus certain items, such as IRA deductions, student loan deductions, higher education costs, foreign income, and foreign housing deductions, among other things.  Second, an adjusted gross income (AGI) is a taxpayer’s gross income minus certain deductions, which are often called “above the line” deductions.  Most tax deductions are “above the line” deductions, except itemized deductions from Schedule A and personal exemptions.
 
Q 11.  When must a first-time homebuyer purchase a property to qualify for the $8,000 tax credit? A  To be eligible for the $8,000 tax credit, a first-time homebuyer must purchase a principal residence from January 1, 2009 to November 30, 2009, inclusive (26 U.S.C. § 36(f) and (h)).  The deadline is November 30, 2009, and not December 31, 2009.  That the deadline is not at the end of the year may work as a trap for unwary buyers. For the first-time homebuyer tax credit for acquisitions from April 9, 2008 to December 31, 2008, see Question 18.

Q 12.  When can a taxpayer claim the $8,000 tax credit? A  According to an IRS announcement on February 25, 2009, first-time homebuyers who qualify for the $8,000 tax credit by purchasing a home before December 1, 2009 have a special option of claiming the tax credit on either their 2008 or 2009 tax returns (IR 2009 14).

Q 13.  Does a married person qualify for the $8,000 tax credit if his or her spouse has owned a principal residence in the last three years? A  No.  For a married taxpayer to qualify for the $8,000 tax credit, both spouses must be “first-time homebuyers” as defined in Question 5.  In other words, neither spouse qualifies for the $8,000 tax credit unless both of them have not owned a principal residence over the last three years.

Q 14.  Are two unmarried individuals both eligible for the first-time homebuyer tax credit if they buy a house together? A  Yes.  Two or more unmarried individuals can buy a principal residence together, but the maximum tax credit for all of them is only $8,000.  If all co-owners qualify as first-time homebuyers, they must allocate the $8,000 tax credit between themselves in any reasonable manner.  According to the IRS, a reasonable method is any method that does not allocate all or a part of the credit to a co-owner who is not eligible to claim that part of the credit (see IRS Form 5405).

Q 15.  Who cannot claim the first-time homebuyer tax credit? A  The first-time homebuyer tax credit is not allowed under any of the following circumstances: •  The property is acquired from a related person as defined (26 U.S.C. § 36(c)(3)(A)) (see Question 16); •  The property is acquired by gift or inheritance (26 U.S.C. § 36(c)(3)(A)); •  The buyer is a nonresident alien (26 U.S.C. § 36(d)(1)); or •  The buyer disposes of the property (or the property ceases to be the principal residence of the buyer and, if married, the buyer’s spouse) before the end of such taxable year (26 U.S.C. § 36(d)(2)).

Q 16.  What acquisitions from related persons do not qualify for the first-time homebuyer tax credit? A  A buyer is ineligible for the first-time homebuyer tax credit if the property is acquired from certain related persons, including, but not limited to, the following: •  The buyer’s spouse, ancestors (such as parents and grandparents), or lineal descendants (such as children or grandchildren); •  A corporation in which the buyer owns more than 50% of the outstanding stock; or •  A partnership in which the buyer owns more than 50% interest. (26 U.S.C. § 36(c)(3)(A) (citing §§ 267 and 707).)

Q 17.  Is a first-time homebuyer required to repay the $8,000 tax credit? A  No, the tax credit need not be repaid if the buyer owns and occupies the property for at least 36 months.  If, however, the buyer disposes of the property or it ceases to be the buyer’s principal residence within 36 months of purchase, the buyer may be required to repay the tax credit (26 U.S.C. § 36(f)(4)).  This includes situations where the buyer sells the home, converts it into a rental property or business, or the home is destroyed, condemned, or disposed of under threat of condemnation.  In these situations, the tax credit must generally be repaid by including it as additional tax for the year the home ceases to be the buyer’s principal residence (26 U.S.C. § 36(f)(4)(D)).

Q 18.  What is the $7,500 first-time homebuyer tax credit for a principal residence purchased in 2008? A  With certain exceptions, a first-time homebuyer may receive a 10% tax credit not to exceed $7,500 for purchasing a principal residence from April 9, 2008 to December 31, 2008 (26 U.S.C. § 36(a) and (b)).  This tax credit was enacted as part of the federal Housing and Economic Recovery Act of 2008.  As with the $8,000 tax credit discussed above, the $7,500 tax credit phases out if an individual’s modified adjusted gross income exceeds $75,000 (or $150,000 for joint filers) (26 U.S.C. § 36(b)(2)).  The $7,500 tax credit phases out completely if an individual’s modified adjusted gross income exceeds $95,000 (or 170,000 for joint filers) (26 U.S.C. § 36(b)(2)). The $7,500 tax credit must generally be repaid like an interest-free loan in equal annual installments over a 15-year period, or in full if the homebuyer sells the property for a gain (26 U.S.C. § 36(f)).  For example, to repay a $7,500 tax credit for 2008, about $500 should be added to the buyer’s income tax liability every year for 15 years starting 2010.

Q 19.  What are the major differences between the new $8,000 tax credit and the previous $7,500 tax credit? A  The $8,000 tax credit is $500 more and applicable to first-time homebuyers who purchase a principal residence from January 1, 2009 to November 30, 2009.  The $8,000 tax credit need not be repaid if the buyer stays in the property for 36 months. On the other hand, the $7,500 tax credit applies to first-time homebuyers who purchased a principal residence from April 9, 2008 to December 31, 2008.  The $7,500 tax credit must generally be repaid over 15 years.

Q 20.  How does a first-time homebuyer apply for the tax credit? A  A first-time buyer may claim the tax credit on their federal tax returns using IRS Form 5405, which is available at http://www.irs.gov/pub/irs-pdf/f5405.pdf.

Wow!!

One of the most asked questions is "Chris, you're an expert in San Diego real estate,---when are we going to hit the bottom?".

Hmm------let's talk about that-------

First question I ask is "Well, did you miss the top?"  (as in, 'did you know when the market was at the top in 2005/2006') Most say YES---'I missed the top'.  -----Then I ask, "Well how will you know when you hit the bottom?".  The only way you will know is because you MISSED IT!  Prices will have gone up.  Interest rates will have gone up and Sellers won't negotiate with you anymore.

We already have multiple offers on most properties in decent shape under $500k.  If you don't think we are at or near the bottom, then please listen up. ---------- WE are at OR near the bottom.  It is time to buy!!  It is time to SELL!!!  Don't let 2009 and 2010 pass you by.

Renters are realizing their rental payments are not much less than a mortgage payment so they are starting to buy.  --- Cash investors are no longer 'waiting' on everyone else to start buying because they know what is happening-----and THEY are buying rental properties because many 'renters' won't qualify for financing which makes a great rental market.  Baby Boomers (anyone born between 1946 & 1964) are retiring and wanting to move to sunny, warmer climates near water and beautiful sunsets (sound familiar San Diego?).  Generation 'X' (1965 to 1980?) and Generation 'Y' (20 somethings) are creating wealth and are looking to purchase their first and second homes by using the $8000 tax credit.

If you missed the top, please don't miss the bottom.  Call ME or have your referred friends, family or co-workers call me or email me.  619-840-4810 ChrisB@Weichertelite.com .  I will treat your referrals like they are my own family-------with ultimate care, respect and integrity.