• For more information about the Cherokee Association of Realtors and Habitat for Humanity, refer to the links below:
• http://www.cherokeerealtors.org
• http://www.habitat.org/

What is the Homestead Exemption?

A homestead exemption could be called property tax relief; in the way that it allows a home owner to deduct a set amount from the assessed value of their legal primary residence, from their total property tax value. To be eligible a person, a non-person entity is not eligible, the home must be owned by the person wanting to file for the homestead and it has to be their legal residence (actually occupying the residence) as of January 1^st of that year.

Example: Mr. Smith buys his house, in Cobb County, on August 12^th, 2011. He can file for homestead exemption at any time before April 1^st for the 2012 tax year. He cannot apply the homestead exemption to his 2011 taxes because he didn’t own the property on January 1, 2011.

A home owner only has to file for a Homestead Exemption once and they do not have to file for the exemption again for the length of ownership.

How, and where, do I file for my Homestead Exemption?

The application for homestead exemption must be filed at the tax commissioner’s office, or tax assessor’s office depending on the county, by April 1^st of the taxable year, to be applied for that year. (Some counties have earlier deadlines)(An application can be filed year round, but will not apply until the following year) Your specific county can be found at http://ow.ly/5gMVi, this is a page that will allow you to search for the appropriate taxing authority and the address to file your homestead exemption. Depending on when you are filing, you may have to bring a copy of your Warranty Deed that you received at closing with you, a copy of the Settlement Statement (HUD-1) to show ownership of the property, your identification, and in some counties you may have to provide your social security number.

How much is the Homestead Exemption?

In Georgia the deduction amounts range from the normal $2,000 exemption to a total 100% exemption. (Normal tax exemption of $2,000 applies to the majority of home owners in Georgia.) The amount of deduction from the state can be found here on the Georgia Department of Revenues’ website: http://ow.ly/5gMsN. In general, the amount of the tax relief was between $200 and $300. Counties can also have homestead exemption amounts, like the state, county exemptions range from $2,000 to a 100% exemption, but are generally more generous. (Cobb County has a base of a $10,000 exemption for homestead and will give a 100% reduction in school taxes to home owners over 62.)

“The consumer bureau will work to make sure that consumers have the information they need to understand the terms of their agreements with financial companies. It will also work to make regulations and guidance as clear and streamlined as possible so providers of consumer financial products and services can follow the rules on their own.

Congress established the CFPB to protect consumers by carrying out Federal consumer financial laws. Among other things, the consumer bureau will:

• Conduct rule-making, supervision, and enforcement for Federal consumer financial protection laws
• Restrict unfair, deceptive, or abusive acts or practices
• Create a center to take consumer complaints
• Promote financial education
• Research consumer behavior
• Monitor financial markets for new risks to consumers
• Enforce laws that outlaw discrimination and other unfair treatment in consumer finance

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) established the consumer bureau. Many of the pieces of the Dodd-Frank Act relating to the CFPB will go into effect on July 21, 2011. The Secretary of the Treasury is responsible for setting up the consumer bureau and, on September 17, 2010, President Obama and Treasury Secretary Geithner named Elizabeth Warren as Assistant to the President and Special Advisor to the Secretary of the Treasury on the CFPB.”

As part of making the process easier they have just released a disclosure form, for review and public comment. This form will combine aspects of the Good Faith Estimate (GFE) and the Truth in Lending (TIL) forms, which Lenders and Mortgage Brokers are required to give to potential clients. The new form does show some interesting information like: How much you will have paid your principal down in 5 years, how much you will have actually paid, and your Annual Percentage Rate (APR).

CFPB Disclosure Option 1

CFPB Disclosure Option 2

The proposed disclosure form is for Lenders and Mortgage Brokers, to give to potential clients when they are shopping for a loan. This form is supposedly easier to use and understand than the current Good Faith Estimate (GFE) that Lenders give to potential clients at the present time. If you call, going from three pages on the current GFE to two pages on the disclosure forms that the CFPB is proposing, and removing a lot of the descriptive language describing what each column and row of numbers mean, then yes this form is easier to use and understand. While this form is easier for people to look at and read, because of the simplicity of the document, it takes away the descriptions and meaning of the information provided, which may hinder the consumer to make a more informed decision.

Also based on this new form, it looks like the only charges that are regulated are the “Origination Fee”, which cannot change, and the “Required Services you cannot shop for”, which can still increase by 10%. Unlike, the current GFE where the “Title Services” and “Items you can shop for” can only increase by 10%, now they can now change more than 10%. Why? Is it because the Lender/Mortgage Broker does not always know what the “Title Services” will cost or is it because Title Companies and Attorneys did not like to be limited to what they could charge based on a quote by a third party? Either way, on the proposed disclosure the charges seem to be allowed to change.

The current GFE is working, why change it? Does the proposed disclosure make it easier to shop for a loan? The disclosure forms are open to comments until May 27^th at: http://www.consumerfinance.gov/knowbeforeyouowe/