Cyrus updates his clients on the upward trend in home mortgage interest rates, the recent existing home sales number and the extension of the first time homebuyer tax credit to include move up buyers. Tune in and see why clients find these videos so informative.
Duration : 0:4:0
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Watch It’s Always Sunny in Philadelphial Season 5 Premiere 2009 The Gang Exploits the Mortgage Crisis online For Free
It’s Always Sunny in Philadelphia S 5 E 1 The Gang Exploits the Mortgage Crisis [SHQ]
Dennis, Mac, and Frank go into real estate, while Dee sets out to be a surrogate for a wealthy couple. Charlie gets into it with an attorney over the law.
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Duration : 0:2:18
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Watch It’s Always Sunny in Philadelphial Season 5 Premiere 2009 The Gang Exploits the Mortgage Crisis online For Free
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Dennis, Mac, and Frank go into real estate, while Dee sets out to be a surrogate for a wealthy couple. Charlie gets into it with an attorney over the law.
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Duration : 0:2:23
Connecticut homeowners can learn the truth behind all the mortgage advertising garbage they hear on the radio and on TV promising 1% rates.
Duration : 0:10:0
http://realestatemarketingthisweek.com/first-time-home-buyer/30-year-fixed-fha-mortgage-is-the-best-financing-available-for-first-time-home-buyers-today/ – 30 year fixed FHA mortgage is the best financing available for first time home buyers today. –
Part 8 – So now the only question that I would have, Michael is you only lowered the guys interest rate by 1/8th of a percent, weren’t there a whole lot of closing costs associated with that? Good question, in this particular case no. There were no closing costs.
Well then it definitely makes sense to lower your interest rate if it’s not going to cost you anything and you can lower your monthly payment by 100 bucks a month you would be crazy not to do it.
His breakeven was one day, in that particular case.
It goes back to this Velocity of Money concept. If you’re not sure if it makes sense or not, it’s kind of a no-brainer, give the team at velocity financial a call. You will do the analysis for them to determine if it makes sense or not based, on their unique circumstance, and from there youll advise them on the appropriate type of loan.
You know it’s funny that people over the years they get so hyper-focused on the interest rate of the loan. Interestingly enough I had a recent client whos focus was not on the interest rate, it was on the closing costs. The problem is there is a correlation between the cost of the money and rate, you have to pay it isn’t free for anyone. No cost loans are not really no cost, youre paying a higher rate to get it, so where does it make the most sense for you and your family, how long are you going to use this mortgage? There are so many factors, there’s an incredible amount of discovery that needs to be done.
If you walk into your local financial institution it doesn’t necessarily have to be a bank and you ask what is the rate today? It’s vanilla, it’s not 31 flavors, its vanilla, this is what we have. Well we have a couple of other options, but that’s not how it works at the bank.
One thing I wanted to point out Michael was it was back in 2003, we saw interest rates that were close to what they are now and a lot of people got into the same kind of loan that I got into at that, I got into a three year adjustable loan. And I’m really kicking myself because I wish I’d gotten into a 30 year fixed, and I would say with anyone, especially with as low as interest rates are, they definitely have to get into this market. jump in and get themselves into a 30 year fixed and just be happy with it forever.
That’s a really good point, and it’s safe. If you have a 3 year ARM or two year adjustable, or a 5 year adjustable and youre 1, 2, 3, 4 years into it, the 30 year is the safe way to go, more than likely the interest rate is going to be lower than what you have. In the case of the adjustable ARMs, adjustable-rate mortgages just dont make sense today. If you have a 30 year fixed, its the safe bet.
Dan if you and I are wrong and real estate values continue to tumble, you know what, you have a nice safe loan and you dont have to worry about it for a long time. On the other hand if you want to live there for 20 years, you dont have to mess with it. I think its the right thing to do for most people
Well I think that anyone who is out shopping for a home over this weekend, and what they’re looking for is to not only ask the seller to pay as much of the closing costs as possible but first to get pre-qualified by calling you at velocity financial. They want to make sure that they get themselves a 30 year fixed, FHA is probably the best product out there right now because its such a low down payment, and if youre a first time home buyer and youre in the $60,000 a year range, you can go out there and buy up to that $250,000 house and have a place for your family to be in after the first of the year, and never have to you live in an apartment and have Christmas in an apartment again, you can have Christmas in your own home next year.
Absolutely, that is a really, really good point. We dont want to forget about the $7500 tax credit that goes along with having a home, if you havent owned real estate in the last three years.
The other thing that I want to mention before the show gets wrapped up today, there is interest rate risk here just like there is in the bond market. Interest rate risk is you the buyer looking at what you can use to increase the velocity of money, increase the efficiency in your existing mortgage, or move to a new mortgage because money is cheaper today than it’s ever been… http://realestatemarketingthisweek.com
Duration : 0:5:50
This is a recent homebuyers seminar I put together in Daly City, California. If you would like information about further seminars, please let me know at jvetter@mercurylending.com. I can help you with you California and Oregon refinance and purchase needs.
Duration : 0:9:50
http://realestatemarketingthisweek.com/first-time-home-buyer/now-is-a-great-time-for-first-time-home-buyers-to-get-into-the-real-estate-market/ – Now is a great time for first time home buyers to get into the real estate market –
Part 3 – Back in studio of course Brett Fallon are favorite and one of America’s best financial advisors, and a very good friend of mine for a long time also Dan Havey. Dan, what is the name of the book?
The name of the book that I am in the middle of writing is called, Real Estates Future. What it is, is a model that I created with a friend of mine. I didnt believe this was possible when it was first brought to me, but after working on it for six months and doing a lot of research I found that we were actually able to predict, in advance, through a whole series of equations and data, we were actually able to predict in advance the top of the last real estate market here in Phoenix by six months.
So were doing a lot more research to see if we can take that to a broader national level and see if we can come close to actually giving people an idea in advance of the top and bottom of the real estate market.
And this is not the doom and gloom type stuff, this is reality, this is not media spin or anything, correct? No, this is just numbers. That’s all this comes down to, numbers, a lot of different equations. I am not going to bore people with all the complicated stuff. When I was in college I started out with a degree in computers and mathematics and eventually ended up getting a degree in finance, so Ive got a lot of numbers spinning around in my head.
The amount of content you have put together to talk about these first time home buyers, we just talked about what you should do when buying a home right now, you need to make sure that you get the seller to pay as much as they can, obviously you want to pay as little for the house as you possibly can. You want to get the seller to contribute as much as they can. But Dan why dont you talk about what it means to be a first time home buyer or for someone who could be in the market?
Well again with the numbers we were looking at, how this came about like I said last year we were working on this model and after the real estate market kind of took a crash we put it to the side for a little bit and the other day I said, its about time to resurrect it because we have to start looking at when is it going to be the bottom of this next market and people are going to want to know that.
So I started looking at some numbers here just in Phoenix and a couple things actually surprised me, it was very heartening for me when I saw that one of the metrics that we look at is whether or not the median income household can afford to buy the median priced home. And right now in Maricopa County the median income family makes $64,000 and the median priced home is $160,000 and $160,000 home is well within the means of the $64,000 income family. In fact just running numbers at 5 1/2 to 6% you could probably buy as much as a $250,000 house.
So then I took a look at where are houses selling right now, and I found that 78% of all of the houses that were sold in Maricopa County last month were under $250,000. So 78% were under $250,000, and I do believe that between $100,000 and $250,000 its like 53% of all the houses, and obviously there is some of the cheap stuff that is being sold at the repo sales and that kind of stuff right now too.
Like I told you before, my brother picked up a couple of REOs over the weekend and I think he paid $30,000 each for them. And there is one other thing I would like to say before we move on, where I think its a great time for first time home buyers to kind of jump back into the market is another metric we look at is year over year home sales, and for obviously the last two years the home sales were declining year over year, and what we have seen is in the last 6 months there were at least a thousand to two thousand more sales per month than there were in 2007. And percentage wise that is pretty high, its not just a thousand or two thousand the percentage is significant. Sometimes the numbers dont mean a lot, but when youre talking about an increase of 20 plus percent in a few of these months, thats huge… http://realestatemarketingthisweek.com
Duration : 0:5:47
Tax on 1099C, Cancellation of Debt Income; Short Sale, Loan Modification & Foreclosure. Exception; Mortgage Forgiveness Debt Relief Act, Bankruptcy & Insolvency. Go To http://RealEstateMarketingThisWeek.com
Part 6 (Excerpts)
Arizona is not a recourse state, so chances are you will not owe 1099 C Income
In Arizona, typically its not a recourse state, so if they are telling you that theyre going to garnish your wages because you didnt pay back your entire mortgage, there is a local bank ,that was threatening a very good colleague of ours about a small second mortgage that person had taken out. Threatening to send it to collections and garnish her wages. It simply isn’t going to happen.
But nevertheless, there is still the tax implications that apply, if you need to navigate through this maze. There is a lot to it, you need to protect yourself. You talked about bankruptcy is one of those exclusions, right? One of the problems with bankruptcy is people dont understand the bankruptcy laws. They are so tight now and your feet are really held to the fire from the federal government right now. It’s not like you just didn’t make your mortgage payment, so you go file bankruptcy, it’s just not realistic. Assuming bankruptcy is the last resort option for everybody. And we certainly want to avoid that, it would not be sound financial advice from any credible source that I can think of.
Let’s walk through a case scenario, somebody who is listening to this broadcast, their head is spinning right now, they’re thinking, oh my gosh. I should have known about the tax implications, a short sale versus loan modification. Let’s start at the top and work through a quick scenario. And then we’ll point out the specifics of what they should be considering right now.
For example, we talk about this all the time and to your credit Michael Barnes and to Velocity Financials credit, you were early in bringing out the loan modification for people who were in a distress situation regarding a mortgage, maintaining or keeping up with the mortgage payment. So you started going down the path where the refinance started to become a much more difficult option, with new constraints and all the other factors that led to part of this economic crisis, a loan modification has become a buzz topic today. Driving to the station today, driving down Camelback Road, I see a sign on the corner. You know, one of those stick in the ground, homemade jobs, that says don’t refi a Loan, modify, with some success rate and the phone number.
Hang on there I want you to say the success rate. The sign literally said, 99% success rate, and it goes back to the point that you made when they say that they can reduce your mortgage principal by tens of thousands, hundreds of thousands of dollars, thats the absolute last resort for any lending institution. Thats not what this is about, so let’s start with that, then we will work on the tax ramifications of how that might work in the overall financial strategy.
I am familiar with the loan modification industry here in Arizona. There is no regulation, unfortunately. We at Velocity Financial work with a national network of attorneys, so if you’re the guy in El Centro California, or youre in Phoenix, or youre in Alaska it doesn’t matter where you’re at. We have someone who is an expert in that field in that state because the laws are different. But without the regulations some person with the ugly yellow sign on the side of the road says he has a 99% success rate, I don’t believe him it’s probably not using an attorney, who knows, dont buy into that garbage. Were going to tell you the truth, if we cant do a loan modification, we will tell you that we cant do it. And if a loan modification is not the best thing for you, you can find the some of these other options.
Duration : 0:5:19
Tax on 1099C, Cancellation of Debt Income; Short Sale, Loan Modification & Foreclosure. Exception; Mortgage Forgiveness Debt Relief Act, Bankruptcy & Insolvency. Go To http://RealEstateMarketingThisWeek.com
Part 5 (Excerpt)
Mortgage Forgiveness Debt Relief Act of 2007, one exception to paying cancellation of debt income
Welcome back to the Velocity of Money I am Michael J. Barnes Arizona’s and I’m with Velocity Financial and were here every week talking about all matters financial, regarding real estate as well as finances. Brett Fallon is back on the air with us again along with Mike Patenella who is a certified public accountant for the last 20 years and amazing brain, were glad he’s back on.
Mike we were talking before the break about loan modifications, my point before going off the air was that people think they’re going to get this huge amount of money waived on a loan that they have, realistically what most loan modifications are going to look like is extended term, significantly lower interest rate, generally a fixed interest rate for the entire time, and in some cases they will do some principal reduction, and there is some exclusions for people having to pay tax on that, is that correct?
Yes, there is, before I get into that keep in mind that with taxes normally not one rule applies to everybody, were going to talk general but everyone’s going to have their own specific situation, that they’re going to have to really check with somebody and make sure they’re doing the right thing. In 2007 in response to the economic situation, they passed a mortgage forgiveness debt relief act which essentially allows people to not pay tax on $2 million dollars debt forgiven on their principal residence. Thats in regard to be principal reduction, loan modification.
Right, so in your example if $50,000 of your loan is being reduced, if your situation fits, under this new law, we might be able get you to avoid the tax on that.
Once again a very good reason for you to go to a professional CPA like yourself for that help, not something the average person is going to be able to figure out on their own. You have to keep up on the tax law and that’s almost a full-time job.
Hey how many pages is that tax code now? On last count I heard you say it was something like 9000 pages.
I don’t know the exact number of pages I know it’s in the several thousand and as Mike knows quite well, and I am aware of also is the tax code has been morphing and changing more than I have ever seen in my entire career here recently. Going back to the tax act of 2003 to the present there have been literally hundreds of changes. So for the average person whos listening to this broadcast who is considering a loan modification, trying to take care of a portfolio, and take care of their taxes at the same time, WOW! Good luck to you
So exclusions to the income, can we talk about a few different ones?
Sure bankruptcy is one exclusion, if you’re filing bankruptcy; the other one is if the taxpayer is insolvent which essentially means that their liabilities exceed their assets. When you factor in assets you factor in retirement accounts and all that, its not that easy to fall under that one.
Oh so the value of my 401(k) goes into that on the other side of the balance sheet. So for the most part if you dont fall into one of these two youre going to try to rely on this new tax law to exclude some of the debt forgiven.
How long ago was that past? I am sorry I don’t remember, was that August of 2007? It’s called the mortgage forgiveness debt relief act of 2007 and it only applies to qualified principal residences. Is that ongoing? Is there a cap on the time?
Well originally it was set to expire at the end of 09. Then in 2008, since the economy kept getting worse they extended that another three years or so through 2012
Well we hope were all well through of this mess sooner and we won’t have to need this any longer after 2009. Actually I want it gone now.
Duration : 0:6:20
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