The Basics: 2009 First-Time Home Buyer Tax Credit

I can't recall a better time for first time home buyers than we are experiencing right now.

Interest rates at historical lows. Exceptional tax incentives, both State & Federal. Record inventory of homes for sale, many at prices not seen in almost a decade.

What's not to like?

Already, however, there are signs that the tide may be turning. Exceptional properties are receiving multiple offers. Once again we are seeing multiple counter offers or calls for "highest & best." I'm not suggesting that you have to dash out tomorrow and buy the first thing you see. I am suggesting that you establish priorities and move forward.

Step one, talk to an Exclusive Buyers Broker, such as myself. Allow me to explain the difference between an Exclusive Buyers Broker and a "buyers agent." In a nutshell, any real estate agent can be a "buyers agent." However, in a heartbeat, that buyers agent can turn into a "Dual Agent", representing both you & the seller in the same transaction. Why is this important to you? Can you imagine an attorney going into a courtroom and representing both the prosecution & the defense?

As an Exclusive Buyers Broker, neither I, nor my company, takes listings. I only represent buyers, never sellers. My loyalty is only to my buyer client.

At our initial meeting, I'll explain in detail How I work for you. THERE IS NEVER A CHARGE! Exclusive Buyer Brokers are paid through escrow, with the Broker compensation offered in the MLS by the seller.

The next step is for you to pick a lender you are comfortable with. I can suggest several mortgage lending professionals for you to consider. Once you have completed the mortgage application and received a full approval, subject only to appraisal and title, we will begin the home search.

Armed with that full loan approval you offer will be taken seriously by the seller. When you have an accepted offer, I'm with you  every step of the way through Escrow & closing.

It's not a easy as it sounds. You will be competing with an increasing number of sophistcated buyers. Good properties go quickly. You will receive overnight e-mail updates from me of new listings that match your needs.

The relationship between an Exclusive Buyers Broker & his buyer client is a true partnership. From our initial contact until I hand you the keys to your new home, we're in this together.

If you are serious about home ownership, give me a call or drop me an e-mail. In the meantime visit my website www.DonNelsonRealEstate.com for in depth information on financing as well as direct access to the San Diego & Palm Springs MLS.

Exclusive buyer's agents who dedicate themselves to representing buyers only, bring a special advantage to the home purchase process for first time home buyers. Buying a home today is a complicated process so the advocacy of an experienced, skilled real estate agent can provide additional help for the first time home buyer and result in a better outcome.

Wouldn't you like to know about the availability of first-time home buyer loans that have lower interest rates on their mortgage products? How about getting a home inspector who understands that he works for the buyer, not the real estate agent? If you are buying a new home you will need to learn about construction standards and lot selection. These are just some of the advantages of working with an exclusive buyer's agent.

Other benefits to using an exclusive buyer's agent include finding out the seller's motivation for selling. If the agent works for the seller, he cannot disclose that information to you yet it could have a major impact on the amount you offer for a house as well as the date for closing. If the agent works for the seller, he cannot tell you about any conversations he has had with the seller that would reveal information that could strengthen your bargaining position. And he cannot point out reasons not to buy the house or that a better home is available in the neighborhood.

Home buyers who have not made a purchase in over a decade may find that they, too, would benefit from working with an agent who is skilled at educating the novice buyer. Seek out your own special agent, one exclusively representing buyers, to help you. Use an interview process to ask the kind of questions that help you understand the difference between a “standard agent” and an “exclusive buyer's agent”.

Whether your dream home is new construction or an existing home, you will want to know what to look for as you begin your home search. You will need a checklist for buying a home to serve as your road map with criteria for buying a home.

Check out the list below and how I, as an exclusive buyers agent will help you conduct a home search, negotiate, and close on a new home. I can help you with the process of buying a home while representing your best interests throughout the purchase process.

Use the home buyer checklist below to prevent errors and to stay on track:

1. Get fully pre-approved for your mortgage
   Credit report, FICO score, type of mortgage, shop for best rates and programs.
2. Determine your wants and needs
   Style of home, size, price, location.
3. Contact me to set up an initial meeting. Make a list of questions for that meeting & look for good personal chemistry.
4. Search for homes in the MLS, always available on my website.
   Sign up for daily email notification services.
5. Check out the neighborhoods, schools, crime rate, traffic, zoning, and work commutes.
   Rely on your exclusive buyer's agents expertise and in-company resources. Check the web for helpful information.
6. Do the due diligence and research on your property of interest
   Visit city hall to learn of any zoning changes, liens, easements, or other restrictions.
7. Prepare the offer and negotiate
8. As your exclusive buyer's agent, I will prepare a property value study and ask the seller if there are any other offers and his motivation for selling, deadlines, etc.
9. Conduct the home inspections and other inspections
   Take advantage of the inspection contingencies in your offer and get thorough inspections to eliminate any surprises after you move in to your new home.
10. Final negotiations and sign the Purchase Agreement.
    Use the inspection report to make repair requests, if necessary.
11. Walk-through inspection prior to Closing
    Visit your new home before close of escrow to make sure everything is as you expect it to be.
12. Closing

Real estate transactions have grown increasingly complex with the need for greater due diligence and research before an offer is made and a full understanding of the roles and duties of agents involved in a transaction. The Southern California real estate market is picking up steam once again. The investors are back and homes that are perceived to be a good value are once again seeing multiple offers.

As your Exclusive Buyers agent, I can help you make certain that when you find the right home, you are able to move quickly and present a solid offer. After your offer is accepted, I'm with you every step of the way through the inspection process. I can assist you in understanding the disclosures, title reports & HOA docs. I'll always review your lenders charges and the preliminary closing statement to head off problems.

Finally, I will continue to be available to you long after I've handed you the keys to your new home!

Selected information courtesy of NAEBA.

Don't feel like you're the only one... lenders are brutal these days! 

Don't be surprised if your friendly lender, the one who invites you to sit down and apply for a mortgage, ushers you politely out the door empty-handed after you've chatted a bit.

The sudden chill isn't personal. The Mortgage Bankers Association, or MBA, in Washington, D.C., estimates that about half of all mortgage applicants are now being turned down. Though refinancing approvals remained static, the acceptance rate on mortgage applications suffered a 10 percentage-point drop, from 63 percent in the first half of 2007 to 53 percent in the first half of last year, according to mortgage data tracked semi-annually by the association. Since then, further tightening of credit standards means at least half of mortgage-seeking consumers can't squeeze through to acceptance, says MBA spokeswoman Carolyn Kemp.

Instead of yielding to shame, anger or any of the usual emotions associated with rejection, today's consumers who are intent on buying or refinancing should adopt a pragmatic stance, since clear-eyed determination may eventually land them a loan.

Here's how:

1. Get a read on the reason
if you've submitted a formal application, federal law dictates that you're entitled to a formal rejection.

Expect an "adverse action" notice, spelling out the reasons for turning you down, which these days is likely to state that the loan amount you're seeking is too large compared to the current appraised value of your home, says Joe Theisen, president of the Wisconsin Mortgage Professionals Association and branch manager of Fairway Independent Mortgage Corp. in Madison, Wis.

If it's not your home's value that's the issue, it may be your personal credentials, such as your creditworthiness, work history or debt load.

When credit is the issue, an adverse-action notice is required, naming the credit reporting agency that provided the data on which the lender based its decision, according to Federal Trade Commission rules. You're also entitled to a free credit report; see the FTC Web site for more information.

Given the odds of acceptance, a lender may not require you to pay a few hundred dollars to submit a formal application, which includes the cost of a professional appraisal on the property. Instead, he may pull a credit score, and tell you what you're likely eligible for, says Marc Savitt, president of the National Association of Mortgage Brokers.

2. Find a fix
qualifying for a mortgage isn't a black-and-white issue. Rather, different loans at varying rates may be available, depending on how risky a lender thinks a particular mortgage will be. If you don't qualify at 5.5 percent, for instance, you may be able to get the nod for a loan at 6 percent or 6.5 percent.

However, many borrowers, especially those who are refinancing, need a certain rate to reach the monthly payment they want. Not only are rates higher for risky loans, but there are now upfront "point" charges dictated by Fannie Mae and Freddie Mac, the two big mortgage guarantors currently under government control, Savitt says.

To get a good rate, some borrowers may be able to make changes — like lowering the amount of the loan they seek.

When a borrower isn't far from the qualifying mark, he may be able to reapply and be approved relatively quickly. For instance, if you're within reach of a 740 credit score, which is usually required for the best rate, you might pay down a balance on a credit card and hit the target, Theisen says.

3. Seek out other opinions
Not every lending firm adheres strictly to the same playbook, and one lender may approve what another rejects, says Savitt, who recently had a borrower with good credit turned down for a low down payment, government-insured loan, but found another firm giving the green light.

A local "community bank," meaning a smaller, hometown institution, may be more flexible, contends Diane Scriveri, chief lending officer at Bogota Savings Bank in Teaneck, N.J., and vice chair of the affordable housing committee of the New Jersey League of Community Banks.

"Because we're local, we may know home values better. We still use independent appraisals of course, but we may look at comparable (home values) differently because we know what's really happening in different neighborhoods," she says.

Credit unions, which only offer loans to consumers who qualify for credit union membership, may also be more forgiving, says Tony Emerson, president of the Credit Union League of Connecticut.

"It would be foolhardy to suggest that in every case, you can go to a credit union and get a loan," Emerson says.

Still, he says, some credit unions may judge loan eligibility based upon the unique relationship they have with their members. For instance, many credit unions offer membership to employees of specific companies and would know more about a member's job stability, he says.

4. Give it another try
The Mortgage Bankers Association is predicting that 30-year fixed rates will hover near the 5 percent range through 2009. So if predictions hold and interest rates stay relatively low, you should have time to try again if the factors behind your rejection improve.

Fortunately, a rejection shouldn't bring down your credit score, says Craig Watts, public relations director for Fair Isaac Corp.

Making a formal application and then reapplying more than a month later could lower your score, but only by about 5 points. Most scoring systems allow consumers to make multiple mortgage applications within a 30-day period without any negative impact on their credit score. But mortgage inquiries older than 30 days will count as a single inquiry if they're made within a 14-day or 45-day window, depending on the scoring model used.

Under the heading of  amazing....in less than a year FACEBOOK has gone from a toy for the MUCH younger set to a heavy duty networking tool for "mature Adults"...(see how polite i am!)

In the past 60 days, I have connected with a number of people, who at one time were an important part of my daily life. For what ever reason, over the years we lose track of people whose friendship we value.

I've found that Facebook allows us to stop and smell the roses".... There is real truth to "six degrees of separation."

For those of you who are Facebook Users the following reprint from PC magazine will be of interest.

For those of you who haven't taken the plunge......... Do it. Like everything in  life, the more effort you give, the more benefit you will receive from the experience.

The following article is reprinted from PCWorld.com.

So you signed up for Facebook, added friends and photos, joined a few groups, and updated your profile status. But now what? Isn’t there more to Facebook? There is.

Here are ten tips to tweak your profile and get more out of Facebook. These tips go beyond the typical and include ways to stay better connected to your friends and look good doing it. To compile this list I searched high and low and even called on Facebook for the best tips. Most are easy to do and all will add some Facebook pizzazz to your profile.

Power search tips

Just like Google and other search engines, Facebook has some built-in power search tools and terms to help you find people. Want to search your Facebook network or friends list, but you want to narrow the results to fall within an age range? Just enter a term using the “name,” “y1” and “y2” search filters. For example, I wanted to find my buddy Colin from college, but I can’t remember how old he is. To find him I just entered in “name: Colin Bauer y1: 25 y2: 40” and voila! The search string asked Facebook to look for people named Colin Bauer between the ages of 25 and 40.

You can also use two search terms at once by dividing the terms with the “pipe character” (|) (the pipe is found on the same key as the backslash).

If you want people to easily find you when they search, fill out your profile as much as you can. That way your profile interests—music, books, movies and so on—will move you closer to the top of Facebook search results for those keywords. Check out Facebook’s help page for more handy search terms.

Integrate Facebook information with Gmail

The Firefox add-on called Xoopit is designed to streamline browsing and sharing of files, photos, and videos with friends on other social networks via Google’s Gmail service. One of Xoopit’s handy features (seldom touted) let’s you see who among your e-mail contacts is signed on to Facebook and displays their profile photos, status updates. The Xoopit add-on also lets you update your status inside Gmail via a nifty little Xoopit box that integrates into the Gmail interface.

This Xoopit Facebook Demo from Jonathan Bruck on Vimeo walks you through how it works.

Personalize your Facebook URL

SocialToo allows you to create a custom domain for your Facebook profile page such as username.socialtoo.com. This allows you to share your Facebook site with other people without requiring them to search for you on Facebook to find your profile. Granted, you might have to explain to your friends that even though Facebook.com isn’t in the Web address it’s still takes you to your Facebook page. The domain is much easier to remember than an eight-digit profile ID.

Signing up with SocialToo is quick and free. You can set up your Facebook settings under “preferences” on SocialToo’s Website. Just remember to choose your SocialToo username wisely.

Another way to create a custom domain for your Facebook page is go to your Profile page in facebook and copy the Web address that appears in your browsers address bar. Then head over to Tiny.cc. Now paste your Facebook profile Web address in the Tiny.cc’s “Enter a long URL you want to make tiny” form field. And directly to the right you’ll see a Custom option. Here you can create a custom URL that follows the convention http://tiny.cc/username.

Hack your profile photo

Want to juice up your profile photo?

Check out AllFacebook.com’s 5 Creative Ways To Hack Your Facebook Profile Photo. You’ll learn how to maximize your picture size to 200 pixels wide by 600 pixels high, and how to create some neat effects like making it look like you’re hanging off your profile Wall.

In my tests, the specifications for this effect took some carefull tweaking but the payoff was worth it. If you’re handy with a photo editor this will be easy for you. If you don’t have Photoshop, you’re going to need to get yourself a photo editing program to take advantage of this hack. There are pleany of good free photo editing programs to get the job done such as such as Paint.Net or Photoshop Express (online). You’ll find more free photo editing software at PC World’s Download section.

Put Facebook Chat in your browser sidebar

Is Facebook your main IM tool? You can place it in your browser’s sidebar. For my tests I used Firefox, but this also works in Opera. In Firefox just go to Bookmarks -> Organize Bookmarks and click on Bookmarks Toolbar. Select New Bookmark, and name it Facebook Chat. Then paste in this URL: http://www.facebook.com/presence/popout.php. Make sure you’ve selected “Load this bookmark in the sidebar” and hit Save. Now you’re ready to go. Sorry IE fans — this is not for you; however, you can paste the URL into a new browser tab if you like.

Get back the old Facebook look (more or less)

Ever feel constrained by the Facebook layout and look? You can actually change the look of your Facebook page with some tinkering and a little help from a tool called Greasemonkey that allows you to use Java Scripts to change the Facebook look. The only catch is the new look is something only you can see—your Facebook friends see the same old Facebook page. Once you’ve added Greasemonkey to Facebook, visit Greasemonkey’s companion site UserScripts.org and browse dozens of layout options for your Facebook page. Click “install” on the new Facebook layout you want and let Greasemonkey take care of the rest.

A word of warning: Before you go nuts downloading Facebook layouts like crazy be carefull. Greasmonkey scripts for changing your Facebook layout use JavaScript. JavaScripts can be malicious and harm your PC if created by a sloppy or crooked coder. Scripts on UserScripts.org can be submitted by anyone and are not reviewed by Greasemonkey. Before you download a new Facebook layout check out the user reviews and exercise caution before installing.

That being said, here are a few of my favorites:

Remove Facebook Clutter: This is a close approximation of Facebook’s previous look and feel. This hides the filters on the left side of the “stream” and the “highlights” section, and takes away the rounded corners on profile photos.

Facebook Color Changer: Pick a color scheme and change your FB colors. This script used to let you change the Facebook icon on the top left of the screen as well, and the developer promises this feature will be back.

Facebook Twitter Style: Have you heard how Twitter supposedly inspires Facebook’s new look and feel? Why not take this concept to its logical conclusion and view your Facebook homepage as if it really were Twitter?

Upload mobile photos or videos straight to your profile
Just took a great picture or video with your cell phone and want to post it on your profile right away? Set up your profile settings to allow mobile uploads.

Go to the Mobile tab under your Facebook account tab and set up your phone to send photos to your Facebook page directly from you mobile phone. A word of caution if you set up Facebook to do this.Take heed of your Facebook mobile settings and adjust them properly.

When Facebook Mobile is activated you also let Facebook send text messages to your phone for those sending you friend requests, e-mail messages, wall posts, and status updates. That could become an astonishing text message bill if you’re not careful. This feature is only available in the U.S., Canada, and the U.K.

Tweet your status

This is one of my personal favorites. Adding the Twitter Facebook application to your Facebook profile gives you the option to turn your Tweets into your Facebook status updates. Not only that, but Twitter is smart enough filter out @replies so that personal messages don’t end up on your profile.

Use these third-party apps

There are many Facebook third-party apps that help you keep tabs on your Facebook friends. Some are barebones, while others give you more in-depth information. Here are the ones I like the best that will give you the biggest bang for your buck (actually they are all free).

Don't be shy, invite me to be your friend when you join Facebook.

Don N. Nelson

Broker-Owner

Accredited Buyers Representative

Certified Exclusive Buyers Agent

National Association of Exclusive Buyers Agents

 e-PRO, Notary Public
Don Nelson Real Estate.com
San Diego Direct 619-446-6978

Palm Springs Direct 760-320-8627

Fax 866-675-3876

Mailto:Don@DonNelsonRealEstate.com

Free MLS Access For
San Diego County & The Desert Cities Visit
www.DonNelsonRealEstate.com
When you have a friend, family member, or colleague looking to buy or sell real estate I can help.

Rarely a day goes by that I'm not asked about short sales. It can be a good last resort for sellers as a Short Sale is typically shown on their credit report as a "satisfied debt" which causes their credit score to drop less than in a foreclosure.

 Simply explained, a Short Sale is triggered when the loan (or loans) on a property exceed its current market value. The seller lists his home at its perceived value, regardless of the amount owed and if a buyer makes an offer that is acceptable to the seller it is then accepted "subject to lender approval."

Here's where the going gets rough... many listing agents have no experience in short sales and indeed, statistics show that less than one in five agent attempted short sales actually close. The rest go into foreclosure.

The short sale process is further clouded by the fact that lenders can take months to either accept or reject a short sale offer. One of the more confusing aspects of a short sale is that the San Diego MLS allows the listing to continue to be shown as "active" during the entire time the lender negotiation of an accepted offer is taking place. In a normal transaction, when an offer is accepted, the MLS listing must be changed to "pending" within 24 hours. Adding to the overall confusion, there is no way for a San Diego buyer's broker to automatically exclude short sales (even those with an accepted offer on the table) from client searches. One would be hard pressed to see how this policy benefits a home buyer.

The Desert Area MLS serving Palm Springs & neighboring communities has a much more consumer friendly approach utilizing mandatory search fields (yes or no) for (a) Short Sales (b) Foreclosures (c) Notice of Default Filed. This approach allows a buyers agent to exclude, or include, those type of listings from client searches

One significant result of the long delays in lender response is that many serious buyers are making multiple offers on short sales. Not long ago this would have been considered unethical and few Realtors would have agreed to write them. Today, it's a fact of life, with some buyers writing five or more offers simultaneously, then waiting to see which one "flies." This further clogs the approval process when the buyer walks away from the other offers leaving the seller & lender to start all over with another buyer.

As an Exclusive Buyer Broker, I advise my clients to avoid short sales if at all possible. If, however my clients number one choice is a short sale, before writing the offer I contact the sellers agent with the following questions:

1   Are there any other offers on the property?

2   Who is the lender or lenders on the home?

3   Has a notice of default been filed on the property?

4   Has a "proof of hardship package" been turned in to the lender(s)?

5   Has the lender assigned a "real person" to the file that you can actually talk to?

6   Have any offers been turned in to the negotiator?

7   Have any offers been countered or accepted by the negotiator?

8   How close to foreclosure is this property?

Having the answers to these questions will allow my buyer client to make a more informed decision on writing a short sale offer or moving on.

In any home purchase the most important first step is getting fully approved by a reputable lender. Fully approved means: credit checks, asset verification...everything necessary to submit to their lender except the actual property being purchased. In Southern California, pre-approval is a must. Most sellers agents require pre-approval with the offer and if you are buying a foreclosure, its mandatory.

At Don Nelson Real Estate, we offer our clients a number of approved lenders to consider if they haven't started the approval process, including V A loan specialists for our military clients both active and retired.

A few months back we represented a military family making an offer on a short sale property. Almost three months went by. Finally the call came......... good news & bad news. My clients offer had been accepted, as written, BUT they had to close escrow in 17 days or the property would go into foreclosure. Fortunately, we had all of our ducks in a row, quickly bringing in the home inspector, the termite inspector etc. The lender had been standing by, updating their V A loan file as needed. The appraisal came in, the loan funded and I was able to hand the keys to the buyers with 48 hours to spare!

The bottom line on short sales is...each one is different. Some will work to everyones advantage. Others will turn out to be a monumental waste of everyones time.

Our job as an Exclusive Buyer Broker is to assist our clients in deciding when to step up to the plate and when to pass.