Here’s a little more background: Since 2007, the Mortgage Debt Relief Act has allowed owners selling their homes through a short sale to do so without having to pay tax on the amount their mortgage holders forgave them. In previous days the money that the bank forgave on the loan would have been considered by the IRS as some sort of income on which you must pay taxes!

That will end December 31, 2012, giving homeowners until the end of this year to get out from under their debt without facing tax consequences.

Real estate brokers and agents specializing in the listing and sale of short sales have become the busiest in the industry. The moral here is that if you are going to do a short sale, do it now.  While most short sales take 3-4 months, some can take longer.  You do not want to be sweating out a December 31st closing.

Call us today at 602-456-9388 and we can make it happen for you!

Many people think “I’ll make an offer on a home and figure out later how I’ll pay for it.” But if you want your offer to be taken seriously and if you want to avoid complications when you close on the home, you must get pre-qualified before you start looking.”

See the image below of the form, below.

Pre-qualification quick but very important as you get ready to make offers. And in this market, where houses are selling in days, you can’t NOT have that pre-qualification form ready.

Why? Because there are 3 people who will benefit from your preapproval: You, your Agent, and the seller from whom you eventually buy a home.

Prequalification serves two primary purposes:

• It demonstrates to both you (and to sellers) how much house you can afford.
• It gives you the purchasing power to make a legitimate offer. (In fact, many financial institutions will not accept an offer on a house without a pre-qualification letter.)

But the benefits continue.

A mortgage loan prequalification is simply an estimate of how much house you can afford and how much money a lender would be willing to loan you. The best time to get a prequalification is right at the beginning of your home buying process, before you even start looking at houses. Realtors also prefer that you have a prequalification letter before they start showing houses so they know the price range you have qualified for.

And, in the event you’re competing with multiple offers on your dream home, most sellers will consider offers with prequalification letters before those without. In this market, that’s extra handy. Last year at this time there were about 6,000 active properties, today their are only about 2,000.

The Prequalification process involves either sitting down with a lender or talking with one on the phone, and providing information on your income, assets, debts, and a potential down payment amount. The lender would then provide you with a ballpark figure in writing of how much he thinks you could afford to pay for a monthly mortgage. There is no cost involved and there is no commitment on either side. This estimate is just helpful in helping you figure out if buying a home is a viable option, and if so, what your price range would probably be.

So if you’re thinking of buying a home in downtown phoenix, Call Jeannie! She’ll help you with the whole process.

Or call me for more information about the market: 602-456-9388.

I am a bit intense about recycling. I pick up batteries on the ground when I see them. I drive my recycling to my friends houses because my misguided HOA board refuses to make that a priority.

Most Phoenix resident receive  a recycling bin with their house for all their recyclables. (It is a shame that the city does not recycle for condos, apartments and businesses, but that is something we need to work on.)

But what about all those items you can’t recycle in the regular blue bin?

Light bulbs, car batteries, foam packing peanuts, bubble wrap; none of these items go in the blue can. But throwing them away isn’t an option either. So what do you do? Well, there are recycling options all over the valley for items like these and you can find out where at the click of a button. Earth911 finds recycling options in your area, no matter where youare in the country.

Many of us use compact Flouresent Lightbulbs. Making this change will help to use less electricity at home and prevent greenhouse gas emissions that lead to global climate change. But what do you do when the bulb, which contains mercury, burns out? The EPA recommends that consumers take advantage of available local recycling options for compact fluorescent light bulbs. EPA is working with CFL manufacturers and major U.S. retailers to expand recycling and disposal options.

Keep Phoenix Beautiful has been in Phoenix since 1982 to promote the preservation and protection of our environment through cling initiatives and education, litter reduction, beautification, and community improvement activities. You can keep up with them for news and events about your area.

Have pride in your neighborhood! Keep it clean and safe!

Over the years, brokers have gotten a bad wrap. I work with people everyday who want to go with big banks and credit unions for their loans (because they haven’t done anything wrong in the past few years, right?).

Just recently I had a client who went with a big credit union for her loan, and 7 days before close of escrow, they decided to pull the loan because the bank had issues with the HOA. Lucky for us, Jeanie Bolger from Nova Home loans came in and saved the day. I can’t tell you the number of times this happens.

Here is what I learn and I want to share with anybody who is thinking about finding a lender:

1. Big banks are just that BIG. They’ve got lots of red tape and work to get through everyday, before they even think about giving you a loan. On the other hand, a mortgage broker is a certified professional who seeks the best mortgage terms for you by accessing a network of lenders that includes major banks, trust companies, credit unions and finance companies.
2. Big banks and credit unions tend to be more conservative on loans. So, if you have something out of the ordinary going on, like a second property, a divorce or a spouse with bad credit, stay away from the big banks, especially.
3. Underwriters work fast with Brokers. Jeannie’s brokers are in the same office, so she can work with the underwriter to make sure everything they need and you need is in place. Jeannie can physically walk down a hall and ask an underwriter a question about a loan and get an answer right away. They can’t do that in the mega bureaucracies.

I recently worked with Lonna to find a home downtown. Lonna wanted to go with a credit union because they had given her pre-approval. One week from closing escrow, the credit union pulled the loan and we once again turned to Jeannie.

Lonna loved working with her. “Jeannie answered all my questions immediately and spoke to me like she was trying to help. It feels like your being interrogated when your with a Credit Union, like you’re just a case number, but with a broker it was like they cared.” Once Jeannie took over, it only took two days from when the underwriter received the application to approval.

So, let me be clear: from the time we started to the time we close, Jeannie swooped in and got it all done within 5 days! Its gotta be a record!

So if you’re thinking of buying a home in downtown phoenix, use a broker. Heck, Call Jeannie!

Or call me for more information about the market: 602-456-9388.

I’m sure y’all have heard that “broken window theory” of criminology, made popular by  James Q. Wilson and George L. Kelling in 1982. Basically, if law enforcement does not address small crimes like broken windows then it becomes harder to fight more serious crimes.

I’ve seen this in reverse since I moved to Phoenix in 1998. I’ve seen greater attention on the part of the city and police to things like graffiti and petty crimes. As a result, and along with hard work of urban pioneers, things have gotten much better here.

Well, as city budgets have been cut (thank you Grover Norquist and the like), we are not training new cops and we don’t have the ability to respond quickly to graffiti like we once could.

So, we citizens have to respond in new ways. That is why I am happy to see that Mayor Greg Stanton has created an advisory committee to advise him on current issues impacting phoenix neighborhoods. Mayor Stanton believes “our city is only as strong as our individual neighborhoods, so we must keep an open line of communication.”At Quarterly meetings the committee, comprised of 29 members, will discuss such topics as law enforcement, parks, streets, neighborhood services, etc. The first meeting is set for the end of this month.

On of the reasons we love and live in downtown phoenix, is because if it’s walkability and promise for future communities. It’s important to support the local community and neighborhoods, not only for our quality of life downtown, but our home values in the future.

Short sales sound worse than they are.

Two years ago they took a lot longer and confused many more people (agents and lenders, alike). Now the systems are in place to make these transactions close more smoothly.

Even more important, if you qualify for the HAFA Program, you could get up to $4,500 for short selling your home!

A short sale is where the seller owes the bank more than than the property is worth. The term “short sale” literally means that the property is being sold “short” of what the seller owes the bank. In a short sale transaction the bank must agree to accept less money than what the seller owes and agree to release all liens on the property so that the property can be sold.

If you’re thinking about short selling your home there are a few short steps to the process:

1. Find an Attorney to speak to about your short sale. This shouldn’t cost you a lot of money. You can usually get an initial consultation for about $250. You DON’T need to have an attorney negotiate with the bank for you. If you have a tax attorney or CPA, speak with him or her, too!

2. Get your Property Listed. Listing your property with a seller with short sale knowledge is key to a smooth transaction. This is where I come in.

3. Find a Buyer. You should know that the average “days on market” are much, much lower now than they were even six months ago. This really should not take us long.

4. Send a contract to your lender along with proper documentation. We’ll work with you to make sure all the paperwork is in order for quicker approval. This is the part of the process that takes the longest. But I can take much of the pain out of this.

5. Get Approval and Close Escrow. This part goes largely the way normal sales go –inspection, appraisal, close of escrow.

Did you know 40% of single family and condo sales in Greater Phoenix in January were cash purchases. Now, I’m not talking about sacks or briefcases full of cash, but people are buying homes outright and their are some benefits.

• Psychologically,  there is a big benefit in knowing that you own your house free and clear. You also free up quite a bit of income because you will have no rent or mortgage.
• Buying a house with cash means that if the value of the home goes down by 10% then the money you put in also goes down by 10%. The most you can lose is the amount of money you put in. In the case of a 20% down mortgage, if the house’s value goes down 10% then you lose 50% of the money you put in because of leverage.
• When you have the cash to pay for the full amount of a house, it means that there will be no contingencies on getting a loan and the amount of time needed to close a deal is shorter. This generally gives you the buyer more negotiating power for a discount on the price of the home, and with the number of homes on the market quickly drops timing is everything.

But is it for you? Well there’s no tax advantage. But if the amount of cash you spend does not consist of a significant portion of your liquid assets and the amount of savings you get from an all cash deal versus a loan deal is significant, cash might be for you. In other words, you might be earning more money on your investment in a house than other investments.

Now, I’m not a financial advisor and I suggest you speak with one before you purchase a home. But if you want to know more about the market, please give me a call at 602-456-9388.

Arizona is a beautiful place full of fantastic neighborhoods and if you’re moving here, you’ll probably need a little help deciding what community is right for you.

Jeannie Bolger and I have created a guide for new home buyers with links for information about schools and attractions for different parts of the valley.

This guide will be really handy for people moving in to phoenix neighborhoods or for companies to have on hand for their employees.

If you know of somebody thinking to move to Phoenix, or a company that is expanding in Arizona, please share this resource with them.

Download it here and keep it on hand in your office. Ken Clark’s Relocation Guide

Of course, Jeannie and I are just a phone call away if you need anything.

Credit can be confusing. It’s this strange, omnipresent score board of your financial decisions that determines whether you’re a smart financial risk for lenders. But don’t worry. Having a little knowledge on your side will make sure that you’re putting your best foot forward when it comes to raising your credit score.

Did you know that the credit score you may have purchased from one credit bureau isn’t necessarily the one that your mortgage lender, credit card issuer or auto loan originator will see? There are several different credit scores, even within the same credit bureau. Each of the three credit bureaus (Equifax, Experian and TransUnion) has its own proprietary credit score. 

Luckily, a few years ago Congress required that each of these three agencies to provide you with a free copy of your credit score once a year. Call 1.877.3322.8228 or visit their website to get your score. Hint: they will try to get you to pay for your score, but don’t buy that line. As a lender told me once, the most accurate scores you get when you buy a house are the ones the lender pulls as these are a good indicator of where you are.

Sick of getting preapproved credit cards. You can tell the credit bureau to stop selling your credit information by calling 888.567.8622

Speaking of credit cards, your credit score can be negatively impacted by a late credit card or loan payment, but it can also be affected by less obvious actions. If you close an old credit card account, you’ll reduce your available credit and shorten the length of your credit history, which can negatively affect your credit score. Additionally, applying for new credit can be beneficial to your credit score, but it can also decrease your credit score due to a hard inquiry. Make sure to keep your current credit balance less than 35% of your overall limit

Secure credit cards are a great way to build you credit because you deposit what you spend in advance. Just make sure they report to all three credit bureaus. MidFirst Bank is a great local option for these cards.

Please call Jeannie Bolger, Sr. Loan Officer for more information.

Or call me for more information about the market: 602-456-9388.

I see it more and more everyday. The housing inventory in Phoenix is shrinking and buyers are looking to make offers and get approved as quickly as possible. But for new or first time home buyers the steps to approval can be foreign and slow down the process, which is the last thing you want in this market.

But have no fear! Jeannie’s here!

It’s important as a home buyer to get pre-approval to expedite the process. In short: you want to have a pre-approval letter in hand before you even step foot in a potential home.

Now don’t get confused between pre-qualification and pre-approval.

A mortgage loan pre-qualification is simply an estimate of how much house you can afford and how much money a lender would be willing to loan you. This can be done over the phone in 10-15 minutes by providing information on your income, assets, debts, and a potential down payment amount.

A pre-approval takes more time, but can be just as easy. Getting pre-approved means that you have a tentative commitment from a specific lender for mortgage funding. You provide a home loan lender  with all that fun financial information you probably keep in a drawer in your house (tax returns, pay stubs, assets, debts, etc.) They will run a credit check and work to verify all your employment and financial information. Jeannie can take care of this with you in about an hour in her office.

In the house-buying process, the benefit of being pre-qualified or pre-approved is twofold. Not only do you have the added comfort of knowing what you can afford, the seller may also accept your offer over another if you are pre-approved and the other party is not.

So what are you waiting for?! Please call Jeannie Bolger, Sr. Loan Officer for more information.

Or call me for more information about the market: 602-456-9388.