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Full time Real Estate agent/ consultant with HER Realtors in the Central Ohio area. Dedicated to a clients success using the latest real estate tools, honest communication, and available when you call!

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To decorate when your house is for sale ...or not to decorate...what is the answer?


Add Some Holiday Charm  

Who said all the holiday decorations have to go when you're trying to sell a house? Bring some holiday cheer to your listings this season

Nobody wants to be the Grinch who stole Christmas but when you’re trying to sell a home, too much holiday spirit can turnoff some potential buyers. Buyers are there to look at the house and all of its wonderful features, not tippy-toe over the giant blow-up Santa impeding the front door or squint to see the roof over the nine reindeer poised upon it.

But before you stick a needle in your inflatable Santa, some real estate and staging professionals say home owners can still add a few decorations for the holidays when selling a home and don’t assume buyers won’t appreciate it too. Holiday decor can lighten moods and warm up interiors, so you don’t have to swear it off completely because you’re afraid of offending those who don’t celebrate, they say.

Betty Cunningham with CB Residential Brokerage in Schaumburg, Ill., says showing homes in the Midwest during the winter can be challenging enough, so to spice things up during the winter months she encourages her clients to decorate for the holidays. She’ll even provide guidance on how.

“Isn’t it nice to open the front door and see lights and the Christmas music playing with some cinnamon smells welcoming you? It just says ‘welcome, come in and stay awhile,’” Cunningham says.


6 Principles to Holiday Staging

The key to holiday decorating is to keep the decor high quality and color-coordinated, says June Lizotte with June Lizotte Real Estate in Milwaukie, Ore.

If you plan on staging a home for the holidays, here are some important things to keep in mind.

1. Don’t overdo the holiday cheer.

When Santas start to outnumber the rooms in the house, you may want to start being more selective in what you display.

“If it is ‘cute,’ it stays packed,” says Joanne O’Donnell, president and CEO of Chic Home Interiors, who offers holiday staging services. “Cute is not a universal concept and the surest way to avoid trouble is to keep it simple and elegant.”

The same staging principles apply during the holidays: Don’t overwhelm the space with clutter.

“For every holiday decor item put on display, temporarily pack something you keep out all the time. That way you can avoid over-decorating,” says staging and real estate pro Tori Lynn Wallitsch with Alliance Real Estateand Ross Designs LLC in Omaha, Neb.

Instead of a large Christmas tree dominating the living room, you might opt to have a smaller tree display on a table top -- particularly if the space is small, suggests Lizotte. Your decor doesn’t have to be super-sized or scattered everywhere: Mix in small centerpieces on dining room tables, bookcases, bathroom sinks or end tables -- simple touches such as pine cones or ornaments in a glass bowl.

You also might want to have home owners rethink hanging those Christmas stockings from the fireplace too.

“Whatever the season, when you are selling a home, you want buyers to notice and appreciate the permanent features of the home and if your fireplace is almost impossible to see because your highly personalized stockings are blocking the view, then buyers will not appreciate this focal point for what it is,” Wallitsch says. Instead, ask your sellers to hang the stockings on Christmas eve and remove them Christmas day.

2. Add splashes of holiday colors.

How about some holiday red? Psychology research on color responses has shown that warm colors, such as red, can increase excitement and energy in those viewing it. Pops of seasonal colors -- such as red or green -- add festive cheer to a home too and can be as simple as just adding a red everyday throw to the sofa or adding poinsettias throughout the home.

It doesn’t have to be bold holiday statements: Add greenery to fireplace mantels or as a base for the dining room table centerpieces, O’Donnell says. Or another holiday favorite: Bows and ribbons can add splashes of color -- tie them around candles, wreaths, and basket handles throughout the house for extra pops of color. Don’t underestimate the power of neutral palettes too in your holiday decor, such as silvers and classic whites.

Try repeating colors from room to room and using similar ribbons, ornaments, patterns or decorative items that can add to the consistency of your holiday look, according to holiday decorating tips byWorldofChristmas.net.

But when bringing in holiday colors, be careful not to clash with your home’s current color scheme, O’Donnell says. For example, if turquoise is the room’s dominant color, you might want to hold off on adding bold holiday reds; try silver instead.

3. Stage for the senses.

Get buyers in the mood with some holiday music and the smell of Christmas filling the home. Christmas music -- mixed with holiday scents -- has been shown to boost people’s attitudes in retail stores and increase their likelihood of wanting to visit them, according to research conducted in 2005 by Eric R. Spangenberg, Blanca Grohmann and David E. Sprott Journal of Business Research (Vol. 58, Issue 11).

Cunningham usually gives a holiday CD to her clients to use for showings -- it features mostly instrumental and soft holiday music.

For scents, O’Donnell recommends adding a pot of mulling spices or cider. The Smell of Christmas by Aromatique (candles, potpourri or oil) is a favorite of Cunningham’s or candles that smell like pine or fresh-baked cookies can create holiday season scents too, adds Valerie Torelli with Torelli Realty in Costa Mesa, Ca.

But if you’re going to include a holiday scent just don’t forget the music. The 2005 study showed that the presence of Christmas scent (Enchanted Christmas by Greenleaf in this case) with non-christmas music lowered buyers’ perceptions of the store and its merchandise. But when the Enchanted Christmas scent filled the air with Amy Grant’s “Home for Christmas” music playing in the background, participants had a favorable response and were more eager to buy.

4. Keep the tree simple, yet elegant.

The Christmas tree will likely be your biggest decor piece so it needs to make a statement. Use a string of 100 lights for every foot of tree, suggests Cunningham. In other words, if you have a 7-foot tree, use at least 700 lights (she prefers the white twinkling ones).

Other tips:
  • If your tree is larger than six feet, consider removing a piece or two of furniture so the space doesn’t feel crowded, Wallitsch says.
  • Use ornaments all in one basic color palette with “show piece” ornaments mixed in that add extra style, O’Donnell says. As a general rule of thumb, use about 20 filler ornaments (such as one or two tone bulb ornaments) for every two feet of Christmas tree and then mix in those special “show piece” ornaments between the filler ornaments, using about 10 for every two feet of tree, according to interior design writer Coral Nafie who wrote about holiday decorating tips at About.com.
  • Hang ornaments on the tips of branches as well as inside the tree to add depth, and mix in various size of ornaments.
  • Make sure ornaments that are overly personal -- such as those marking milestones like “Our First Christmas” or “Baby’s First Christmas” -- are not in prominent locations on the tree or keep them packed up for next year, Wallitsch suggests.

5. Give a holiday impression from the curb.

You needn’t be able to view your outdoor holiday lights from space, Clark Griswold, to show your holiday spirit. Twinkling clear, white lights (preferably non-blinking) tend to be the favorite among staging and real estate professionals for classy holiday curb appeal that adds a glow to your listings at night.

“The winter months are usually less than attractive outdoors and some well-placed and tasteful holiday lights or yard ornaments can go a long way to adding a festive and welcoming touch,” Wallitsch says. “Just remember that many potential buyers may either cruise by your home for sale during the day or schedule a showing during the day when outdoor lights are more likely to be an unsightly bunch of wires (such as icicle lights) rather than a cheerful display of color or white lights. Do your best to make your home show its best during the day and night.”

Here some holiday curb appeal tips:
  • Add poinsettias: Plant several poinsettias in groups of three or five close together in the garden. “They really set off the first impression,” says Torelli.
  • Hang a wreath on the front door (and make sure it’s clean!), suggests Cunningham.
  • Have battery-operated candle lamps in each of the windows for extra glow and to show off all of those windows at night.
  • Make the deck sparkle. For example, a weather-proof, tip-proof tree with lights or a simple strings of lights along the deck’s railing can go a long way in adding charm to your showings after dark, says Judy Jensen,Edina Realty in Eagan, Minn.

Then, consider adding the holidays to your marketing: Take a photo of the home at night as it twinkles from the holiday lights and create a special holiday flyer with information about the house.

“This is a great marketing tool we often use in the months of November and December to help sell the home,” adds Torelli with Torelli Realty in Costa Mesa, Calif.

6. Remove decor after the holidays.

Jolenta Averill, broker-owner of Lake & City Homes in Madison, Wis., once showed a home in the middle of summer that still had a huge Santa Claus on its front porch and a Christmas tree lit in the living room.

But Christmas in July isn’t for everyone, so in general, wait to decorate for the holidays until after Thanksgiving and be sure your home owners remove all holiday decor promptly by New Year’s.

As Wallitsch tells her clients: “If you are feeling a little cheated this holiday season by not putting all of your beloved holiday treasures around your house, focus on the reason that you placed your home on the market and keep your eyes on that goal. Next year when you are comfortably settled into your new home, you can go all out with the holiday cheer.”


9 Bathroom Cleaning Problems SOLVED!

I love to have SAFE and NATURAL ways to clean anything. I was especially excited to see this article from Readers Digest and I wanted to share it.


1. "My shower curtain is crawling with mildew"

Wash it with a bleach solution. Shower curtains can be tricky to clean because they are big and cumbersome. Getting rid of mildew, especially during damp weather, can be especially challenging. Here’s a solution that’s quick, easy, and low-cost: Pour 1 gallon (3.7 liters) of warm water and 1⁄2 cup of household bleach into a plastic bucket. With plastic gloves on, soak a sponge in this cleaning solution, give it a squeeze to avoid drips, and wipe. The mildew will vanish. Rinse using the showerhead.

2. "I’m ready to toss this filthy shower curtain liner"

Toss it in the washer. Don’t throw away your liner just because of mildew and dirt buildup. Extend its life by cleaning it in your washing machine. Set the machine on the gentle cycle with warmwater and 1 cup of regular laundry detergent or 1⁄2 cup of vinegar. Afterward, whirl it in your drier, set on Low Heat or Fluff, for about 20 minutes. Your liner will come out clean and wrinkle-free. Rehang it immediately.

3. "My brass fixtures look dull"

Polish them with baking soda and lemon juice. Don’t rush out to buy an expensive brass cleaner. Save time and money by making a paste with equal amounts of baking soda and lemon juice. Dip an old toothbrush in the mix and lightly scrub the fixtures. Let the solution dry a few minutes and then buff the fixtures with a clean cloth. They’ll look brand new.

4. "The nooks and crannies in my bathroom are hard to clean"

Use an old toothbrush. An old toothbrush is the perfect time-saving bathroom-cleaning tool. For example, you can use it to clean the tracks of your bathtub’s sliding glass doors. Simply spray bathroom cleaner on a paper towel and wrap the towel around the bristle end of the toothbrush. Then scoot the brush along the tracks to dislodge dirt. Or put the little bristles to work on the grime that collects around the rim of a bathroom sink. Once the bristles have loosened the dirt, just mop it up with a damp sponge.

5. "I hate those mineral deposits on my bathroom faucet"

Remove them with white vinegar. No one likes crusty white deposits on a faucet. Try this easy solution: Before you go to bed one night, head to your kitchen for a bottle of white vinegar and three paper towels. Saturate the towels in the white vinegar and wrap them around the faucet like a cocoon. In the morning, remove thetowels. Fill the basin with warm water, plus a squirt of dishwashing liquid. Dip an old toothbrush in the solution and scrub the faucet toremove the final bits of mineral deposit.


6. "I have scum buildup on shower doors."

Use furniture oil to prevent buildup. Cleaning soap scum off a shower door is a tough, time-consuming job. Try using lemon oil furniture polish as a barrier against the scummy buildup. The next time you clean the door, follow up by wiping it with furniture oil on a soft rag. Let the oil sit for two minutes and then polish off the excess with a dry cloth. The furniture polish will leave a slight film of oil that will act as a buffer against future soap scum. Using a shower squeegee (available at discount stores and supermarkets) after every shower will also discourage the buildup.

7. "My glass shower doors are filmy"


Clean them with vinegar, baking soda, and salt. Stubborn mineral buildup on glass shower doors is no competition for a few common household ingredients—white vinegar, baking soda, and salt. Spray vinegar on the door and let it sit for a few minutes. Next, create a paste with equal amounts of baking soda and salt. Use adamp sponge to rub this paste over the door; then rinse well.

8. "My bathroom grout is grungy with mildew"

Spray it with vinegar. Mildew on grout is no match for that miracle household cleaning dynamo called vinegar. Just pour somewhite vinegar into a container, dip in an old toothbrush, and scrub away at the mildew. Or pour the vinegar into a spray bottle, squirt it on the mildew, and let it sit for ten minutes. Rinse with water and apply the old toothbrush if necessary. Bleach is effective in removing mildew from tile grout. Fill a spray bottle with equal parts of household chloride bleach and water. Spray the grout, let it sit a few minutes, and then wipe with a clean white cotton cloth.

9. "Those nonslip bathtub stickers won’t peel off"

Loosen them with laundry presoak. You know the ones: They’re shaped like flowers and fish and are stuck on with industrial-strength adhesive. Instead of ruining the smooth surface of your tub trying to scrape them off, follow these simple steps for removing them: Carefully lift corners on each sticker using your fingernail or a plastic scraper. (Metal will scratch most tubs.) Spray the stickers with a good dose of laundry pretreatment product, such as Shout or Spray ’n Wash. Let the stickers soak in the spray for a few hours. This should loosen the stickers and allow you to peel them off. Wipe up any adhesive residue and the laundry spray. Clean and rinse the tub thoroughly.

Why you should consider a home purchase NOW!

1. Low interest rates – Right now, interest rates are lower than ever before. This means you can get an extremely affordable loan and save big on interest payments.

30 Yr Fixed - 1% Org 4.000%*
30 Yr Fixed - No Org 4.250%*

15 Yr Fixed - 1% Org 3.375%*
15 Yr Fixed - No Org 3.625%*

FHA 30 Yr - 0% Org 4.250%*
VA 30 Yr - 1% Disc 4.250%*

**Rates are subject to change based on credit capacity. Based on purchase loan amounts of $150,000. For details, call me today!

2. Cheaper home prices – Not only are interest rates low, but homes all around are cheaper. Since the market is packed with homes for sale, selling has become harder. As a result, prices have fallen significantly, allowing you to get a more expensive home for less money.

3. Potential tax credits - As a first-time buyer, you could be eligible for thousands of dollars in tax credits. Best of all, you do not have to pay it back, as opposed to previous years.

4. Less competition - Many people no longer have the money to purchase homes, so fewer people are buying. This is great news for you-you don’t have to worry about floods of people bidding up the price on the property.

5. Huge inventory – Right now, between the current inventory of homes for sale, short sales, HUD and VA homes, and new build homes you have more to choose from than ever before!! You can take your pick from a wide variety of available properties.

6. Big bargaining power – Because so many people are trying to sell their homes, they’re more willing to be flexible. As a buyer, you could greatly benefit and may be able to save on closing costs, upgrades, repairs and more. Work with me. I can negotiate a great contract for you.

There has never been a better time. Call me today to get your free listing of HUD homes, Short Sales, or to see just how low prices are on existing home! I'll put together a list and e-mail or send it to you today!

Investors ..first time home buyers...have I got a DEAL for you..

Actually...I have several.

Short Sales abound in this market and I have a couple to show you. (A short sale is where the Seller is asking the bank to take less than what is owed on the property)

When a short sale is taking place, true deals can be made. You can buy a property for much less than what was paid for it originally. Sometimes, that can mean 50% of the value. The key to a successful bid on a Short Sale is patience. If you have the patience, the rewards can be exceptional.

Here are two possibilities:



The first is: 3052 Noelle Court

Picture  a quiet street in a cul-de-sac, this classic American contemporary two story has one of the largest yards in the neighborhood..and it's fully fenced.

There are 4 bedrooms...one for each member of the house or 3 bedrooms and 1 guest room!

Christmas doesn't get any better than diner in the dining room and then sitting by a cozy fire in the family room. Make those holiday cookies in your kitchen with loads of counter space and a center island!

This home was purchased in 2006 for $140,000. It is listed today at $119,900.

And #2 

 248 Nashoba Ave
Located on the West Side of Columbus, this home is an investment property and has a long term tenant in it who has mantained this remodeled property with 3 bedrooms, 1 bath and a detached garage.
Charm is everywhere but the Seller has to let it go to short sale.




Originally purchased and remodeled at a cost to the Seller of about $100,000, this home is currently on the market for $44,000. 

These are the 'deals' we have all said...'if only' we could buy this house for this rediculours amount...and here it is...Were you serious?  Here is your chance!

Nu3bers Part 2 Grove City-Urban Crest/Grove Port

Grove City, another charming and older community coming into its own.  Growing by leaps and bounds over the past few years and bordered by smaller Columbus communities, Grove City has Southwestern City Schools, Beulah Race Track, and can be easily accessed by two major road ways: 270 and 71 South.

The next community as you head south...but by no means the only community- If you don't see your community and you want data on it, PLEASE contact me! and I will make sure you get it...is Groveport.
Close to Lockbourne Air Port, close to Obetz, Groveport has taken advantage of their heritage and fabulous older buildings to show off a most beautiful town.   Their numbers don't seem to be as high because it is a smaller community..but even in smaller communities, you will see the ratios are similar overall.

Next post I have some of the interesting deals you can get in one of these neighborhoods.

Num3bers-Dublin/Hilliard

Numbers tell us tell us so many things from the condition of our bank account, and how much change we have in our wallets. We live in and around numbers every day.

In the Housing Market the numbers have changed significantly over the years I have been in Real Estate. Buying or Selling real estate is much more than just a sign in the yard and a contract in hand. I want to share a few more of the graphs from the last article. I'm going to start in Dublin, and Hilliard Ohio. Dublin is a beautiful community with open spaces, and a river running through it...well, that's my romantic version of it. It is beautiful. And quaint. And modern. and oh so much more.

Now that you know how to read the charts, here are Dublin's 'numbers':




Hilliard has come a long way from the small town country area it was to one of the fastest growing communities we have in this area. You can see it best trying to maneuver through the road construction as it tries to keep up with the growing population!

Here are Hilliard's numbers:



It takes a while to digest this market, doesn't it?

What you are seeing is the culmination of the economic pressures on the market in the past year.
Housing prices are going down. The number of sales are going down while the number of houses on the market are going up.

Home prices are, according to experts, supposed to drop 3.5% each year through 2013. Just WHAT do all these numbers mean?

It means people ..you and I ....are seeing some unprecedented times. Nothing like this current economic time has every happened quite in this way before. We don't know how long it will last or where this path will take us. But I think what this also tells us is that what you are looking at is the culmination of job loss, trying to meet bills, the mortgage payment and our dependence on being able to move and make a profit on our assets (our houses).

We are forced to begin to think 'out of the box' for ideas that we've never tried before. As a Realtor, I'm forced to be more creative, become more of a teacher of the facts and figures to people who never expected to have to know these numbers or what they meant.

There are still some basic facts in place and I think we need to keep these in mind:

1. That people..you and I...still need to have a place to live.

2. People will still be buying and selling property They will still use short sales, some will go through foreclosure, others will begin to see their homes as a commodity that needs care, and fixing up to get it sold because of the competition of more homes for sale.

3. As a Seller- you will need to stay on top of the market, of the trends, understand the competition , choose wisely, and move forward.

4. If you are a Buyer it means- staying on top of the market, be aggressive in your decisions, the houses have never been more plentiful or at these prices, choose wisely and move forward.

Rates are at a historic LOW to encourage Buyers to BUY. To encourage Sellers to re-finance if that sees the best..or use the FHA 203-K re-finance to fix up your home and stay put.

If you want more information about these charts, the market, or the loans I mentioned..let me know!

Selling houses in a Buyers Market-Understanding the NUM3ERS

As with anything in life, understanding is a key componant of success. The HOUSING market is no different. To help with this, I am going to give statistics from a company Real Living subscribes to -TRENDGRAPHICS -that deals with the specific housing numbers I'm presenting.


Starting with the ENTIRE Multiple Listing Service areas- that is Franklin and surrounding counties there are were 16,655 listings in the month of August. to see how this looks in graph form:


On this graph you will also see that 1338 houses sold in the month with 1073 in contract and waiting to close. This graph will also take you back to June of last year to see the pattern of houses listed to houses closed.
Take a look at the bottom of the page. Home sales are up 2.8% from 1 month ago but down 27.8% from 15 months and down 23.1% from a year ago.

Every community is different. I will run some of those communities in this blog. If you don't see your area or would like me show you, let me know.

HOME AFFORDABLE REFINANCE PROGRAM (HARP)

What Is The HARP Program?

Home Affordable Refinance Program (HARP) is designed to assist homeowners in refinancing their mortgages – even if they owe more than the home’s current value.

9 out of 10 of eligible Homeowners fail to take advantage of this government program.

If you are current on your mortgage, with or without equity, then you are eligible for this program.



How can HARP help me?

As the government continues to purchase mortgage backed securities, rates continue to fall and are near record lows.

HARP allows you take advantage of current market rates even if you are “underwater”.

These programs are Financial “Life-Changers”. They are also available for a limited time as determined by congress.

Act now to take advantage of this stimulus program, and lower your monthly payment and/or term using the Fannie Mae/Freddie Mac Streamline process.

Use this link to answer all your questions about this help:
http://harpprogram.org/faq.html

ABOUT MAKING HOME AFFORDABLE

If you are facing problems making your mortgage payment, lost your job, or thinking that you might lose your home, please read this information taken directly from HUD's web site on Affordable Housing. There may be help for you and your family here.

From HUD Web Site:

In February 2009, the Obama Administration introduced a comprehensive Financial Stability Plan to address the key problems at the heart of the current crisis to get our economy back on track. A critical piece of that effort is Making Home Affordable, a plan to stabilize the housing market and help struggling homeowners get relief and avoid foreclosure.

The Home Affordable Modification Program provides eligible homeowners the opportunity to modify their mortgages to make them more affordable. Over one million homeowners have already gotten help under the program. The program is on track to offer help to 3 to 4 million homeowners by 2012.

On March 26, the Obama Administration announced expanded flexibility for mortgage servicers to assist more unemployed homeowners and homeowners who are underwater through the program.

The Second Lien Modification Program (2MP) offers homeowners a way to modify their second mortgages to make them more affordable when their first mortgage is modified under the Home Affordable Modification Program.

The Home Affordable Refinance Program gives homeowners with loans owned or guaranteed by Fannie Mae or Freddie Mac an opportunity to refinance into more affordable monthly payments.

The Home Affordable Foreclosure Alternatives Program provides opportunities for homeowners who can no longer afford to stay in their home but want to avoid foreclosure to transition to more affordable housing through a short sale or deed-in-lieu of foreclosure.

Homeowner website, www.MakingHomeAffordable.gov, provides detailed information and resources about these programs. Through this website, homeowners can also connect with free HUD-approved counseling organizations, locate free events in their area, find the application documents necessary to apply for the Making Home Affordable Program, as well as find answers to frequently asked questions, and much more.

More to follow on the
HAFA programs.

BEWARE OF FORECLOSURE RESCUE SCAMS - HELP IS FREE!

Many homeowners may feel that they can no longer afford their home, but want to avoid the negative effects of foreclosure. The Home Affordable Foreclosure Alternatives (HAFA) Program offers homeowners, their mortgage servicers, and investors an incentive for completing a short sale or deed-in-lieu of foreclosure. With these options, under HAFA, a homeowner leaves their home to transition to more affordable housing and alleviate the mortgage debt they owe.


Foreclosure rescue and mortgage modification scams are a growing problem. Homeowners must protect themselves so they do not lose money—or their home.

Scammers make promises that they cannot keep, such as guarantees to “save” your home or lower your mortgage, oftentimes for a fee. Scammers may pretend that they have direct contact with your mortgage servicer when they do not.


The Federal government provides free resources to get you the help you need. Homeowners can call the Homeowner’s HOPE™ Hotline at 1-888-995-HOPE (4673) for information about the Making Home Affordable Program and to speak with a HUD-approved housing counselor. Assistance is available in English and Spanish, and other languages by appointment.


Tips to Avoid Scams


Beware of anyone who asks you to pay a fee in exchange for a counseling service or modification of a delinquent loan.


Scam artists often target homeowners who are struggling to meet their mortgage commitment or anxious to sell their homes. Recognize and avoid common scams.

Beware of people who pressure you to sign papers immediately, or who try to convince you that they can “save” your home if you sign or transfer over the deed to your house.


Do not sign over the deed to your property to any organization or individual unless you are working directly with your mortgage company to forgive your debt.


Never make a mortgage payment to anyone other than your mortgage company without their approval.


What to Do if You Have Been the Victim of a Scam

If you believe you have been the victim of a scam, you should file a complaint with the Federal Trade Commission (FTC). Visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357) for assistance in English or Spanish.


This is taken directly from the HUD Making Home Affordable web site. Please check it out!

Foreclosure and Short Sale Taxes - Home Sellers Might Owe the IRS

Taxes Due IRS When Selling Foreclosures / Short Sales
By Elizabeth Weintraub, About.com Guide

The IRS says there is no free lunch. If you transfer title on your home, whether voluntarily through a warranty deed or grant deed, or involuntarily through foreclosure, you have sold your home. You might be subject to taxes, even if you sold your home at a loss, either on a short sale or by foreclosure.

It doesn't seem fair. What's worse is you might not even find out that you owe taxes until the day you open your mail to find a 1099.

I spoke with Julian Block, an attorney in Larchmont, NY, who has been cited by The New York Times as a leading tax professional. Here is what he has to say about taxes, gains and losses on distressed sales such as foreclosures and short sales:

"Sellers who have owned their personal residences for lengthy periods still will realize gains.

"But sellers of residences acquired within the past two years or so are going to incur losses. Even assuming no price declines, losses will result because of expenses for real estate brokers,lawyers and the like. Sellers will not be able to deduct those losses. Makes no difference that they are forced to sell because of, for instance, job changes or health reasons.

"Besides problems for sellers of personal residences,there are tax troubles for investors who, say, bought several condos in places like Florida and are unable to flip them because prospective buyers are waiting for further price declines. Often, it is not worth while for those investors to rent their places; what they receive as rent payments will be insufficient to cover their real estate taxes and mortgage interest. Their only option is to sell at a loss."

Block on Offsetting Losses Against Gains


"Sellers can offset their capital losses against capital gains. But in the absence of capital gains, the yearly cap is $3,000 ($1,500 for married couples filing separately) on the amount of losses they can offset against their "ordinary income," meaning income from sources like salaries, pensions and withdrawals from retirement plans. The law allows them to carry forward unused losses to later years."

Block on Tax Rules for Foreclosures


"The IRS has tax rules for foreclosures or repossessions by lenders of homes of owners who have fallen behind on their mortgage payments. There can be severe and unexpected tax consequences for an owner who simply walks away because he or she has little or no equity and the lender takes over and sells the place.

"In that situation, cancellation or forgiveness by the lender of the debt usually means the debtor has reportable income, though there are some exceptions -- for instance, insolvency."

Block on Personal Liability

"An example: Brown buys a condo and uses it as a personal residence. He pays $300,000,down payment of $15,000 and takes a mortgage loan of $285,000. He is personally liable for the mortgage. When the remaining balance of the loan is $280,000, Brown defaults and the lender bank accepts his voluntary conveyance of the unit, canceling the loan. Similar condos at the time sell for $230,000.

"The tax code treats the transaction as a sale. Brown incurs a nondeductible loss of $70,000, the amount by which his condo's adjusted basis of $300,000 exceeds its market value of $230,000. No deduction for the loss because Brown uses the condo as a personal residence.

"Brown also has reportable income of $50,000 when the bank cancels the loan. $50,000 is the amount by which the debt of $280,000 exceeds market value of $230,000. "Enter the IRS when the mortgaged property is foreclosed or repossessed, and the bank reacquires it, or the bank knows Brown has abandoned the property. The bank sends a Form 1099-A to Brown and the IRS. Using the numbers in the example, the 1099-A indicates the foreclosure bid price ($230,000), the amount of Brown's debt ($280,000), and whether he was personally liable. Debt cancellation (here, $50,000) is taxed at the rates for ordinary income, same as for salary."

Secured Debt Without Personal Liability


According to Kleinrock Publishing, the IRS says sellers who are not personally liable for a debt will realize an amount that includes the full canceled debt, even if the value of the property that is security for the debt is less, which can be offset depending on your adjusted basis in the property. Purchase money loans secured by real property in California carry no personal liability.

For example, Ms. Smith buys a home valued at $300,000, puts down $30,000 and takes out a mortgage of $270,000. Smith stops making payments. The bank forecloses on a loan balance of $260,000, and the market value of the home has fallen to $250,000. Smith has an adjusted basis of $295,000, due to a $5,000 casualty loss. The amount Smith realizes on the foreclosure is $260,000. Smith figures her gain or loss by comparing $260,000 which is the amount realized, to her adjusted basis of $295,000. She has a $35,000 realized loss.

Before Foreclosure or Selling, Plan Ahead

Before you sell on a short sale or go through a foreclosure, seek legal and tax advice. Do tax planning ahead of time, before it is too late.

For more information, contact a Certified Public Accountant or check the IRS Web site.

A temporary fix, called the Mortgage Forgiveness Debt Relief Act of 2007, provides relief from debt forgiveness taxation for certain owner occupants until December 31, 2012. Call your lawyer to determine if you are exempt from taxation.

Source: Attorney Julian Block's books include "The Home Seller's Guide To Tax Savings," praised by law professor James Edward Maule of Villanova University as "An easy-to-read and well-organized explanation of the tax rules.” To order his books, visit Julian Block's Web site.
10 Reasons to Buy a Home
Enough with the doom and gloom about homeownership. Brett Arends explains why owning a home is a good thing.

The Wall Street Journal, By Brett Arends
September 16, 2010
Enough with the doom and gloom about homeownership.
Sure, maybe there's more pain to come in the housing market. But when Time magazine starts running covers that declare "Owning a home may no longer make economic sense," it's time to say: Enough is enough. This is what "capitulation" looks like. Everyone has given up.
After all, at the peak of the bubble five years ago, Time had a different take. "Home Sweet Home," declared its cover then, as it celebrated the boom and asked: "Will your house make your rich?"

But it's not enough just to be contrarian. So here are 10 reasons why it's good to buy a home.

1. You can get a good deal. Especially if you play hardball. This is a buyer's market. Most of the other buyers have now vanished, as the tax credits on purchases have just expired. We're four to five years into the biggest housing bust in modern history. And prices have come down a long way about 30% from their peak, according to Standard & Poor's Case-Shiller Index, which tracks home prices in 20 big cities. Yes, it's mixed. New York is only down 20%. Arizona has halved. Will prices fall further? Sure, they could. You'll never catch the bottom. It doesn't really matter so much in the long haul.
Where is fair value? Fund manager Jeremy Grantham at GMO, who predicted the bust with remarkable accuracy, said two years ago that home prices needed to fall another 17% to reach fair value in relation to household incomes. Case-Shiller since then: Down 18%.

2. Mortgages are cheap. You can get a 30-year loan for around 4.3%. What's not to like? These are the lowest rates on record. As recently as two years ago they were about 6.3%. That drop slashes your monthly repayment by a fifth. If inflation picks up, you won't see these mortgage rates again in your lifetime. And if we get deflation, and rates fall further, you can refi.

3. You'll save on taxes. You can deduct the mortgage interest from your income taxes. You can deduct your real estate taxes. And you'll get a tax break on capital gainsif anywhen you sell. Sure, you'll need to do your math. You'll only get the income tax break if you itemize your deductions, and many people may be better off taking the standard deduction instead. The breaks are more valuable the more you earn, and the bigger your mortgage. But many people will find that these tax breaks mean owning costs them less, often a lot less, than renting.

4. It'll be yours. You can have the kitchen and bathrooms you want. You can move the walls, build an extensionzoning permittedor paint everything bright orange. Few landlords are so indulgent; for renters, these types of changes are often impossible. You'll feel better about your own place if you own it than if you rent. Many years ago, when I was working for a political campaign in England, I toured a working-class northern town. Mrs. Thatcher had just begun selling off public housing to the tenants. "You can tell the ones that have been bought," said my local guide. "They've painted the front door. It's the first thing people do when they buy." It was a small sign that said something big.

5. You'll get a better home. In many parts of the country it can be really hard to find a good rental. All the best places are sold as condos. Money talks. Once again, this is a case by case issue: In Miami right now there are so many vacant luxury condos that owners will rent them out for a fraction of the cost of owning. But few places are so favored. Generally speaking, if you want the best home in the best neighborhood, you're better off buying.

6. It offers some inflation protection. No, it's not perfect. But studies by Professor Karl "Chip" Case (of Case-Shiller), and others, suggest that over the long-term housing has tended to beat inflation by a couple of percentage points a year. That's valuable inflation insurance, especially if you're young and raising a family and thinking about the next 30 or 40 years. In the recent past, inflation-protected government bonds, or TIPS, offered an easier form of inflation insurance. But yields there have plummeted of late. That also makes homeownership look a little better by contrast.

7. It's risk capital. No, your home isn't the stock market and you shouldn't view it as the way to get rich. But if the economy does surprise us all and start booming, sooner or later real estate prices will head up again, too. One lesson from the last few years is that stocks are incredibly hard for most normal people to own in large quantitiesfor practical as well as psychological reasons. Equity in a home is another way of linking part of your portfolio to the long-term growth of the economyif it happensand still managing to sleep at night.

8. It's forced savings. If you can rent an apartment for $2,000 month instead of buying one for $2,400 a month, renting may make sense. But will you save that $400 for your future? A lot of people won't. Most, I dare say. Once again, you have to do your math, but the part of your mortgage payment that goes to principal repayment isn't a cost. You're just paying yourself by building equity. As a forced monthly saving, it's a good discipline.

9. There is a lot to choose from. There is a glut of homes in most of the country. The National Association of Realtors puts the current inventory at around 4 million homes. That's below last year's peak, but well above typical levels, and enough for about a year's worth of sales. More keeping coming onto the market, too, as the banks slowly unload their inventory of unsold properties. That means great choice, as well as great prices.

10. Sooner or later, the market will clear. Demand and supply will meet. The population is forecast to grow by more than 100 million people over the next 40 years. That means maybe 40 million new households looking for homes. Meanwhile, this housing glut will work itself out. Many of the homes will be bought. But many more will simply be destroyedeither deliberately, or by inaction. This is already happening. Even two years ago, when I toured the housing slumpin western Florida, I saw bankrupt condo developments that were fast becoming derelict. And, finally, a lot of the "glut" simply won't matter: It's concentrated in a few areas, like Florida and Nevada. Unless you live there, the glut won't have any long-term impact on housing supply in your town.


Short Sales revisited



You may have noticed that Short Sales are becoming more prevalent in the Central Ohio area as I know they are all over our country.  It isn't easy for home owners to face losing their homes.  It isn't easy to consider the options but sometimes it becomes necessary.  If you find your self or know someone in this situation, this information could be valuable to you and well worth reading.  I thought this was well written and a good explanation.   I have Sellers currently listing their homes this way. If you would like to see them, go to  www.ccouch.com and click on Featured Homes.


When lenders agree to do a short sale in real estate, it means the lender is accepting less than the total amount due. Not all lenders will accept short sales or discounted payoffs, especially if it would make more financial sense to foreclose; moreover, not all sellers nor all properties qualify for short sales.

If you are considering buying a short sale, there could be drawbacks. For your protection, I suggest that all borrowers:

As a real estate agent, I am not licensed as a lawyer nor a CPA and cannot advise on those consequences. Except for certain conditions pursuant to the Mortgage Forgiveness Debt Relief Act of 2007, be aware the I.R.S. could consider debt forgiveness as income, and there is no guarantee that a lender who accepts a short sale will not legally pursue a borrower for the difference between the amount owed and the amount paid. In some states, this amount is known as a deficiency. A lawyer can determine whether your loan qualifies for a deficiency judgment or claim.

Although all lenders have varying requirements and may demand that a borrower submit a wide array of documentation, the following steps will give you a pretty good idea of what to expect.

  • Call the Lender
    You may need to make a half dozen phone calls before you find the person responsible for handling short sales. You do not want to talk to the "real estate short sale" or "work out" department, you want the supervisor's name, the name of the individual capable of making a decision.
  • Submit Letter of Authorization
    Lenders typically do not want to disclose any of your personal information without written authorization to do so. If you are working with a real estate agent, closing agent, title company or lawyer, you will receive better cooperation if you write a letter to the lender giving the lender permission to talk with those specific interested parties about your loan. The letter should include the following:


    • Property Address
    • Loan Reference Number
    • Your Name
    • The Date
    • Your Agent's Name & Contact Information
  • Preliminary Net Sheet
    This is an estimated closing statement that shows the sales price you expect to receive and all the costs of sale, unpaid loan balances, outstanding payments due and late fees, including real estate commissions, if any. Your closing agent or lawyer should be able to prepare this for you, if you do not know how to calculate any of these fees. If the bottom line shows cash to the seller, you will probably not need a short sale.
  • Hardship Letter
    The sadder, the better. This statement of facts describes how you got into this financial bind and makes a plea to the lender to accept less than full payment. Lenders are not inhumane and can understand if you lost your job, were hospitalized or a truck ran over your entire family, but lenders are not particularly empathetic to situations involving dishonesty or criminal behavior.
  • Proof of Income and Assets
    It is best to be truthful and honest about your financial situation and disclose assets. Lenders will want to know if you have savings accounts, money market accounts, stocks or bonds, negotiable instruments, cash or other real estate or anything of tangible value. Lenders are not in the charity business and often require assurance that the debtor cannot pay back any of the debt that it is forgiving.
  • Copies of Bank Statements
    If your bank statements reflect unaccountable deposits, large cash withdrawals or an unusual number of checks, it's probably a good idea to explain each of those line items to the lender. In addition, the lender might want you to account for each and every deposit so it can determine whether deposits will continue.
  • Comparative Market Analysis
    Sometimes markets decline and property values fall. If this is part of the reason that you cannot sell your home for enough to pay off the lender, this fact should be substantiated for the lender through a comparative market analysis (CMA). Your real estate agent can prepare a CMA for you, which will show prices of similar homes:


    • Active on the market
    • Pending sales
    • Solds from the past six months.
  • Purchase Agreement & Listing Agreement
    When you reach an agreement to sell with a prospective purchaser, the lender will want a copy of the offer, along with a copy of your listing agreement. Be prepared for the lender to renegotiate commissions and to refuse to pay for certain items such as home protection plans or termite inspections.
Now, if everything goes well, the lender will approve your short sale. As part of the negotiation, you might ask that the lender not report adverse credit to the credit reporting agencies, but realize that the lender is under no obligation to accommodate this request. Credit report status is not always negotiable.
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