1031 Exchanges
Posted at 8:32 PM, Jul. 16, 2007
When Governor Gibbons signed Senate Bill 476 into law on June 14, 2007, new safeguards were put into place to help protect consumers when doing a 1031 Tax-Deferred Exchange. As a reminder, a 1031 Exchange is when a property owner defers their capital gain taxes when the sell a piece of investment property and purchased new investment property. Some of the key elements of the new law are as follows:
o Increased bonding requirements
o Licensing requirements for Qualified Intermediaries in Nevada
o The use of Qualified Escrow accounts
Another important requirement to the new law is that per Section 14 of the new law, “Exchange Funds cannot be withdrawn from the account without written approval of BOTH the licensee and the Exchangor.” Also, Section 13 of the new law states “Each licensee shall invest money related to a tax-deferred exchange of property in investments which meet the reasonable standards that are applicable to persons acting as fiduciaries in this State.” First American Exchange Company is in compliance in all aspects of the new law. Our company has always believed that security of funds and knowledgeable employees are what make First American Exchange Company the best bet in Nevada.
Licensing requirements have also been established which will be monitored by the Division of Financial Institutions. To be licensed as a Q.I. in the state of Nevada, an individual must meet one of the following criteria:
1) An attorney or certified public accountant admitted to practice in any state or territory of the United States;
2) A Certified Exchange Specialist, certified by Federation of Exchange Accommodators; or
3) A person who has been actively conducting the business of an exchange facilitator or who has equivalent experience, as determined by the Division, for the 3 years immediately preceding his designation as an exchange facilitator.
Our office here in Las Vegas has 2 Certified Exchange Specialists to help you with any type of exchange you may need to process. If you ever have questions of your transaction, our Las Vegas office will always be available to you, handling every aspect of your transaction, from documentation to transfer of funds.
When using First American Exchange Company, clients have the protection and guarantees of First American Title Company, the nation’s leader in real estate information. That will give you the peace of mind necessary when doing a 1031 Tax-Deferred Exchange.
For more information on 1031 Exchanges or on the new law for Qualified Intermediaries, feel free to call our office at 702-458-1357.
Carmine DiFulvio, CES®
Certified Exchange Specialist
Senior Market Representative
Short Sales - Some Great Tips
Posted at 7:32 AM, May. 19, 2007
More and more 'Short-Sales' are coming on the market in Las Vegas and Clark County. This is a 'pre-foreclosure' process and I've written about it on here before. In a nutshell here are some tips when considering a short sale.
- Most Homes LIST PRICE has NOT actually been negotiated with the Seller's Bank.
- Without a Pre-Negotiated Settlement, it could take up to EIGHT WEEKS or longer for the bank to ACCEPT the buyer's OFFER.
- When making an OFFER on a SHORT SALE your REALTOR® should ask the Listing agent if the LIST PRICE has already been NEGOTIATED with the Seller's bank.
- The bank requires a pre-approval letter with contracts submitted on a SHORT SALE. Before you even start looking make sure you've spoken to a lender and have the loan process started.
- There may be SEVERAL Buyers waiting to see if their offer was "THE ONE" accepted.
- Do NOT roll over if the lender does not at first meet your offer. It is a test and the person who compromises his or her position first loses the game! They need to move these properties on into the after life. Banks are not in the business to own properties.
- You need to cultivate the ability make the bank perceive that their own FULL MARKET VALUE is not accurate and you need to communicate to the lender that you do not agree with their FMV based on the condition of the property, location, market etc.
- Most importantly, you need a REALTOR® who is properly trained on how to structure these deals as they will drive the majority of the real estate transactions in the near future.
At last count there were over 10,000 short sales and/or foreclosures available in Clark County, NV
...for additional information on Foreclosures and Short Sales see the articles posted in January 2007 on this blog.
What is a Foreclosure?
Posted at 8:05 PM, Jan. 26, 2007
Foreclosure is to shut out, to bar, to extinguish a mortgagor's right of redeeming a mortgaged estate. It is a termination of all rights of the homeowner covered by a mortgage. Foreclosure is a process in which the estate becomes the absolute property of the lending institution.
Foreclosure numbers are growing daily. Of the one hundred twenty or so million homes in America, more than 4% or roughly 4.8 million of them are facing foreclosure. Some of these homeowners are able to work their way out of foreclosure, however, according to MBA there were about 500,000 homes that went through foreclosure last year. Foreclosure threatens these homeowners because they are late or seriously behind on their mortgage payments.
The Foreclosure process begins when the homeowner fails to make payments of the money due on the mortgage at the appointed time. This may be due to several reasons. Unemployment, divorce, medical challenges, terms of the loan, sick of property management, and even death.
Foreclosure is applied to any method of enforcing payment of the debt secured by a mortgage, by taking and selling the estate. Borrowers and lenders now face a challenging situation. Both seek a compromise that permits a win-win outcome. The borrower to keep his home or business, the lender to keep receiving mortgage payments.
Foreclosure proceedings typically start with a formal demand for payment which is usually a letter issued from the lender. This letter of notice is referred to as a Notice of Default (NOD). Depending on your state, the lender will issue this notice when the homeowner has been 3 months delinquent on the mortgage payments. Keep in mind that the notice is a threat to sell your property, terminate all your rights in that property and evict you from the premises.
www.ForeclosureUniversity.com
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