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Chicagoland Home Buyer & Seller News & General Real Estate Information
Four Ways the 2009 Economic Stimulus Plan Benefits Home Owners & Buyers
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Four Ways the 2009 Economic Stimulus Plan Benefits Home Owners and Buyers
There are four primary sections of the 2009 economic stimulus plan that could be very beneficial if you own or are buying a home.
Benefit #1 - Expansion of Home Improvement Tax Credit
The tax credit for making energy efficient home improvements is now 30% of the cost of the improvements up to a maximum of $1,500. This means that if the improvements cost you $4,500, you would receive a tax refund of $1,500 when you file your tax returns. Eligible improvements include energy efficient exterior doors and windows, insulation, heat pumps, furnaces, central air conditioners and water heaters. Generally, your home improvement contractor and/or the manufacturer selling the improvements issues a certification that clarifies whether the improvements meet the necessary
standards for energy efficiency. Most modern windows, furnaces, and air conditioners meet these requirements. If you've been holding off on making some of these improvements, now is a great time to get a move on it -especially with all the great deals that are being offered!
Benefit #2 - Expansion of First-time Home Buyer Tax Credit
The tax credit available to first time home buyers was increased from $7,500 to $8,000 for homes purchased between January 1, 2009, and December 1, 2009. Also, the credit no longer needs to be paid back as long as you live in the home without selling it for at least 3 years. The previous version of the credit expired on July 1, 2009, and required home buyers to pay the funds back over a 15 year time frame. The income limitations remain the same ($75,000 for single tax payers claiming the full credit and $150,000 for married tax payers), as do most other qualification requirements. Also, the credit remains refundable. This means that first-time home buyers who owe less than $8,000 in taxes for the year are still eligible for the full $8,000 credit when they file their tax returns. In that case, the IRS will write you a check for the difference between $8,000 and your actual tax bill. In fact, the credit can be claimed on your 2008 tax returns that you file by April 15, 2009, even if you buy the home in 2009. There is one catch, however: if you bought the home in 2008, the credit remains $7,500, and it still needs to be paid back over a 15 year timeframe beginning in 2011 when you file your 2010 returns.
Benefit #3 - Higher Reverse Mortgage Loan Limits
The loan limits for FHA-insured reverse mortgages have been increased to $625,500 across the entire country -not just the higher cost areas. The previous limit was $417,000 across the country. This is especially important because the FHA program is virtually the only game in town as private and jumbo reverse mortgage programs have nearly all evaporated. This coincides with another little-known change in the reverse mortgage arena: the availability of reverse mortgages on home purchase transactions. This is a fantastic opportunity for senior citizens to buy a new home and live mortgagepayment-free without having to wait for their old home to sell. Seniors could also use this strategy to buy a new home and turn the old home into a rental or otherwise wait for market conditions to improve before trying to sell the old home.
Benefit #4 - $729,750 FHA and Conforming Loan Limits Restored in High Cost Areas
The $729,750 maximum loan limit had been in force throughout 2008, but was reduced to $625,500 in 2009. The economic stimulus plan restores the $729,750 maximum. This makes higher cost homes more affordable - especially in the coastal housing markets that tend to have higher than average home values. It is always advisable to consult with a Certified Mortgage Planning Specialist TM (CMPS®) when navigating today's turbulent mortgage and real estate marketplace. Call me for names of mortgage brokers.
e-PRO Real Estate Professional
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Why Choose a REALTOR® that is
e-PRO Certified?
The Internet has added a new dimension to the real estate world. Now you can be assured that the REALTOR® you choose will have the knowledge and skills to put the power of the Internet behind your real estate transaction.
All e-PRO Internet Professionals are REALTORS® who completed a rigorous certification program endorsed by the prestigious NATIONAL ASSOCIATION OF REALTORS® (NAR).
Real estate agents and brokers who have earned e-PRO Certification are Internet Professionals who have completed extensive training using the Web. e-PRO Certification means the real estate professional is prepared to employ the latest techniques and services for your benefit, just like you've grown to expect from a professional.
Life can be a little easier.
Save time and irritation. Work with an e-PRO Certified real estate professional who provides both buyers and sellers with high quality, timely information using the resources of the Internet.
e-PRO Internet Professionals maximize your ability to leverage the enormous power of the Internet when you are buying and selling property.
Working with the best pays off.
Save money. e-PRO Internet Professionals can help you take advantage of the latest Internet innovations resulting in considerable savings and speed whether you are a buyer or a seller of property.
Work with someone who is ready, willing, and very capable. Your e-PRO Certified real estate professional has already proven that he or she is prepared to respond to the new market place. e-PRO Internet Professionals are committed to being more responsive, understand that you are the boss, and will completely respect and guard your privacy.
Rest easy...
e-PRO Internet Professionals can offer you the peace of mind that comes from knowing you have chosen to work with a REALTOR® committed to using the Internet with skill, integrity, and professionalism.
Work with a professional who has made the extra commitment. Choose an e-PRO.
When is a Real Estate Professional a REALTOR®?
When they are a member of the NATIONAL ASSOCIATION OF REALTORS®. The Voice for Real Estate® -- the world's largest professional association.
The term REALTOR® is a registered collective membership mark that identifies a real estate professional who is a member of the NATIONAL ASSOCIATION OF REALTORS® and subscribes to its strict Code of Ethics.
Founded in 1908, NAR has grown from its original nucleus of 120 to today's 750,000+ members. NAR is composed of REALTORS® who are involved in residential and commercial real estate as brokers, salespeople, property managers, appraisers, counselors and others engaged in all aspects of the real estate industry. Members belong to one or more of some 1,700 local associations/boards and 54 state and territory associations of REALTORS®. They can join one of our many institutes, societies and councils. Additionally, NAR offers members the opportunity to be active in our appraisal and international real estate specialty sections. REALTORS® are pledged to a strict Code of Ethics and Standards of Practice.
Working for America's property owners, the NAR provides a facility for professional development, research and exchange of information among its members and to the public and government for the purpose of preserving the free enterprise system and the right to own real property.
Copyright© InternetCrusade® and NATIONAL ASSOCIATION OF REALTORS®.
All rights reserved.
CRS Specialist
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CRS Specialist
Why do I need a certified residential expert?
Buying or selling a home is one of the most crucial financial transactions of your life. In what can be a confusing and sometimes difficult process, it pays to leave as little to chance as you can. But with the help of a professional, you can navigate unknown territory with ease. To fill the specific residential needs of homebuyer and sellers, the Residential Sales Council of the National Association of Realtors® (NAR) instituted a class of expert real estate professional: the Certified Residential Specialist (CRS®).
How can a CRS help me?
Every CRS has undergone a rigorous, specialized course of detailed training aimed at making residential transactions as smooth and worry free as possible!
A CRS brings special qualifications to your needs:
Membership in a local Board, State Association, and the National Association of REALTORS® (NAR.). Every CRS is part of a much larger network of real estate professionals. Successful completion of the courses leading to the Certified Residential Specialist designation, one of the most successful residential real estate education programs in the country. Every CRS is a real estate professional equipped with special expertise, thanks to advanced study in listing, selling, investment, tax and more. A history of demonstrated sales performance through the documented execution of residential sales transactions. REALTORS® must conform to the NAR® code of ethics.
What this means is that when you work with a CRS, you're working with someone who is more knowledgeable, and experienced.
What if my needs are special?
If anything about your transaction is special, seek out a specialist. A Certified Residential Specialist designation, offered through NAR, denotes an agent who specializes in residential real estate. It's as simple as that. Only 3% of all REALTORS® and REALTOR ASSOCIATES® have earned the right to be called a CRS. Less than 5% have developed special residential sales skills and enhanced their residential sales knowledge through study, dedication and experience. A CRS can help you optimize your transaction by identifying better prospects, clarifying investment potential and helping you to understand the tax ramifications of your real estate transaction. It all adds up to one thing: better service.
What special qualifications does a CRS bring to my transaction?
Your trust in a CRS is well earned thanks to these distinctive credentials:
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A professional designation of residential specialty, the highest in the country.
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A higher level of education in residential sales.
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Affiliation with thousands of real estate professionals on the local and national levels.
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Up-to-the-minute industry information.
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Local market knowledge and special residential expertise unique to your area.
CRS® is a registered trademark of the National Association of REALTORS®
Portions of this page are from the CRS brochure published by the Residential Sales
Council of NAR
Internet Savvy Home Buyers
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Demographics: Internet-savvy home buyers are more likely to use a real estate professional to complete transaction.
The Internet is a powerful tool for both home buyers and agents.
1. In 2004, 75 percent of home buyers used the Internet as an information source, primarily searching for listings.
2. Home buyers who searched for residential property on the Internet typically purchased homes that were 19 percent higher than other home buyers.
3. The Internet also helped facilitate action by home buyers. For example, nearly 70 percent of all Internet-using home buyers visited a home with a real estate agent as a result of their use of a real estate Web site.
4. More than three-quarters of Internet-friendly home buyers used a REALTOR® to complete the home search and close the transaction. This compares to 64 percent of other home buyers.
5. The most widely cited real estate Web site used by home buyers in the survey was REALTOR.com® at two-thirds of respondents. The second most popular site was the real estate company’s Web site with 41 percent of Internet home searchers visiting.
Source: The 2004 NATIONAL ASSOCIATION OF REALTORS® Profile of Home Buyers and Sellers
Eleven Mistakes Buyers Almost Always Make
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Eleven Mistakes Buyers Almost
Always Make When Purchasing A Home!
1. Making Too Low an Offer
You would be surprised at how many dream homes are lost because of the buyer’s inability to move a little on price, terms, or concessions. Remember that $5000 in today’s loan market increases your monthly investment $35.82 per month – the cost of an average dinner out and hardly a price worthy of giving up a lifetime of satisfaction. Follow your professional advice if you really want the property!
2. Not Using Your Real Estate Professional Team
Lenders, Abstract/Title, Inspectors, and Facilitators are all important members of the purchasing process. They must be the best and they must work together. Remember, your agent is the best coach in assembling the team!
3. Not Getting a Professional Inspection
Your real estate agent can point out obvious defects; the appraiser, whether FHA, VA or Conventional can also point out some defects. Therefore, we recommend a professional inspection (structural, mechanical, plumbing, electrical, etc.), who puts on the overalls and crawls below, in and above your future investment to write up a complete report.
4. Not Differentiating Needs, Wants, and Dreams
Write down your minimum needs, then the “what would be nice” items, then the “in my dreams” items. A great agent always fulfills your need without exceeding your financial capabilities, and usually surprises you with many of your wants and dreams.
5. Getting Financing to Match Your Ownership
When counseling with your agent regarding your purchase, your financing terms have to be consistent with your ownership. For instance, if you are not going to stay in the property long, then get a variable resistant financing so you have the lowest interest rate during your time of ownership, plus an assumable loan (probably) when you sell. Long Term ownership? Go for a fixed loan so you can lock in a market rate for 30 years.
Services for Home Buyers
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Services For Home Buyers
How do Brokers Earn Their Money?
1. Explain the benefits of a Buyers Broker/Agent.
2. Determine the approximate price range for which the buyer will qualify. This is called pre-qualifying, and includes an in-depth inventory of the buyer's resources, and a discussion about credit.
3. Describe how lenders and loan brokers work.
4. Explain the benefits and drawbacks of various standard kinds of financing.
5. Explain loan charges and their relationship the cost and rate of the loan.
6. Provide ideas for alternate methods of finance or purchase if necessary.
7. Explain the use and benefit of a lender pre-qualification letter.
8. Recommend several lenders or loan brokers who can provide a credit report, (and corrections if needed), eligibility documentation, liens, or any other preliminary work that should be done to make the buyers as strong as possible.
9. Go over in general your financial and personal plans, as they relate to real estate. Verify that your purchase will be compatible with both your long and short term goals.
10. Make a final determination that you can afford to buy the kind of property that will meet all, or most of your needs.
11. Discuss your motivation for buying, in order to insure that you buy a property that will best meet all of your needs. Buyers have been known to fall in love with a property, only to admit later that it is too expensive to maintain, too long a commute, or in some other way not a good choice.
12. Provide a copy of the Real Estate Relationships Disclosure.
13. Review the Real Estate Relationships Disclosure.
14. Provide a copy of the Real Estate Consumer Guide.
15. Provide a copy of the Buyer Brokerage Agreement.
16. Review the Buyer Brokerage Agreement.
17. Explain commission agreements as stated in Buyer Brokerage Agreement.
18. Provide an Agency Agreement Addendum.
19. Explain the Agency Agreement Addendum, as needed.
20. Assist in developing a prioritized list of the criteria you can use to select the best home for you.
21. Help you keep on tract with your criteria when analyzing the pros and cons of various properties.
22. Inform you of possible tax benefits, and or ramifications of your purchase.
23. Explain how the structure of your purchase agreement may affect you financially.
24. Help you select the most advantageous time
a) to make an offer.
b) to close your escrow.
25. Provide a copy of the purchase agreement form before the time comes to sign. This gives you time to familiarize yourselves with it.
26. Provide a good understanding of potentially appropriate neighborhoods in your price range.
27. Provide rating data about local schools.
28. Provide locations and characteristics of shopping areas.
29. Provide information about local and regional transportations systems.
30. Share information about available parks and recreation.
31. Explain what sports facilities and programs exist locally.
32. Tell about various churches and religious institutions in the area.
33. Provide facts regarding any existing or possible negative aspects of all areas you are considering.
34. Explain how the Realtor Multiple Listing Service for appropriate homes.
35. Search properties listed in the Multiple Listing Service for appropriate homes.
36. Examine local newspapers for appropriate properties.
37. Check Home Finder magazine for appropriate properties.
38. Search the Newspaper classifieds for homes.
39. Look through Home Journal magazines for appropriate properties.
40. Review our own personal list of homes that are not on the market, but which we know could be available.
41. Check our list of For Sale By Owner Homes for properties which may not suit your needs.
42. Contact owners of property and arrange to show homes to you.
43. Efficiency show appropriate homes.
44. Share any personal knowledge about local history, weather, political activity or other factors which may affect your decision.
45. Explain and define real estate terminology as needed throughout the buying process.
46. Discuss the benefits and liabilities of various styles of home types of materials and construction.
47. Describe how the orientation of the home on the property affects its function, comfort and energy usage.
48. Help you find a Diamond in the Rough. That is, show you how to add value to a home that may not be perfect, but has most of the
features you require.
49. Act as a sounding board, in your decision making process.
50. Provide information about the sellers motivation for selling, if known.
51. Provide a comparative market analysis to determine an appropriate offering price.
52. Write an offer which will best meet your needs and protect your interests.
53. Provide explanation of particular clauses of the agreement if needed.
54. Explain the lenders appraisal process.
55. Provide a written estimate of the costs to close the escrow, including down payment, and monthly payment under the terms of your offer.
56. Be sure that the events and conditions agreed upon in the contract can be realistically performed within the time limits provided.
57. Explain how offers to purchase property are presented.
58. Make an appointment to present your offer.
59. Present your offer to the seller in a business like manner.
61. Respond to seller objections with minor modifications which allow the seller to accept, while not significantly altering your position.
62. Recalculate costs, and monthly payments, in the event of a counter offer from the seller.
63. Verify representations by the seller, such as, the existence of a building permit for improvements.
64. Provide professional negotiating experience.
65. Help remove negotiating obstacles before they arise by knowing the financing and escrow process.
66. Suggest minor modifications which may allow the seller to accept the offer, and which may not make a significant difference to the buyer.
67. Suggest several reputable service companies for a house inspection.
68. Provide several companies who can supply a Pest control Inspection.
69. When there is a well, give list of respected Well Inspection and Testing Companies.
70. Provide the names of good Chimney Inspection Companies we have worked with in the past.
71. Suggest a number of reputable Roof Inspection Companies.
72. Make arrangements for the various inspections, as required.
73. Be present if possible, when these inspections take place to add clarity to the written reports. Inspections usually take place during the workday.
74. Help interpret which report items are serious, and which are relatively minor.
75. Assist in finding the least costly solutions to problems revealed in the reports.
76. Re-negotiate with the seller to pay for items which are important, or a matter of health and safety.
77. Arrange, as requested to have another expert give an opinion in a case where experts express differing opinions.
78. Arrange for repairs, as necessary.
79. Provide a Sellers Disclosure Statement in a timely manner.
80. Review Sellers Disclosure Statement for items of concern.
81. Provide a Lead Paint Disclosure in a timely fashion.
82. Explain Lead Paint Disclosure form.
83. Gather more information about any items on that disclosure which may be of concern to the buyers.
84. Rewrite the contract, if needed.
85. Explain the use of title escrow company.
86. Explain escrow accounts.
87. Deliver earnest money to listing broker.
88. Go over terms, price and projected closing date with escrow officer.
89. Inform the officer of all parties to the transaction, and how to contact them.
90. Order a Preliminary Title Report.
91. Review the Preliminary Title Report when received to look for clouds on the title, unforeseen liens, easements or encroachments. Any of these could delay closing.
92. Explain Covenants, Conditions and Restrictions, as appropriate.
93. See that the pending sale has been reported to the Multiple Listing Service.
94. Closely follow the deadlines listed in the contract, assuring that buyer and seller perform as agreed. A critical task, as an error in timing can nullify the agreement.
95. Work with the lender to provide information and approvals within the agreed time frames.
96. Provide regular weekly updates on escrow progress to buyer and to sellers agent.
97. Arrange for buyer to see property again as needed for measuring, improvement plans, furniture placement, etc.
98. Explain the protections provided by a Home Warranty Plan.
99. Order a Home Warranty, if requested.
100. Explain Home Owners Insurance requirements.
101. Assist in arranging for Home Owners Insurance, if requested.
102. Provide a list of moving companies, and information regarding the rates, and the services they provide.
103. Provide a list of the telephone numbers of local gas, electric, water and garbage service companies, also the phone company.
104. Arrange a smooth transition of the change in utility service from seller to buyer.
105. Help the buyers locate temporary housing if needed.
106. Assist the buyers in locating local reliable child care.
107. Arrange the exact times when the seller will leave, and when the buyer will move in. As the close of escrow approaches, very often, events beyond the control of either buyer or seller sometimes dictate minor adjustments in the original plans.
108. Negotiate for buyers if the escrow process takes longer than expected, and an Early Move-In Agreement is required.
109. Conduct a final walk through inspection of the property to be sure nothing has been changed since the purchase agreement was ratified.
110. Make arrangements to rectify any problems discovered during the final viewing.
111. Provide written explanation of the various ways to hold title to real property.
112. Provide the names of at least three attorneys who can explain the ramifications of holding title.
113. Explain closing papers.
114. Explain loan documents.
115. Explain closing statements
116. Check closing statements for accuracy.
117. Arrange for wire transfers of funds as necessary.
118. Pick up closing documents and final refund check for delivery to buyer after close of escrow.
119. Attend closing with buyers to help explain any questions.
120. At all times protect the buyers interests.
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