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Now’s the time to make a move if you want to take advantage of the homebuyer tax credit, which expires on April 30.  Remember, you have to close by June 30.  That means short sales, which can often take longer than 60 days to close should be a last resort.  Focus on bank owned and non-distressed properties.  Happy hunting!

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If you are interested in taking advantage of the homebuyer tax credit and buy a home in Northern Virginia, the clock is a-ticking.  Seventy days to find your home sounds like a lot of time, but it will surely go by very quickly as you are competing with throngs of other buyers looking to cash in.

A word of caution: beware of writing offers on short sale listings.  These transactions typically take 60 days or more to get to closing after you’ve ratified your contract.  Keep in mind, you must close by June 30 to receive the credit.  If you get under contract right at the deadline of April 30, you’ve only allowed yourself 61 days to get your deal closed.

If you or someone you know would like to buy a home in Northern Virginia, contact me anytime at 703-403-0536 / patrick@patrickduffyrealtor.com.

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You see the foreclosure notices in the local paper and you hear they conduct these auctions “at the courthouse steps”.  The courthouse isn’t the first place on your list of places you want to be.

Well, it’s actually a place brimming with opportunity for Northern Virginia real estate investors.  Just take a look at how many people faithfully show up day in and day out hoping to snatch up a property.

Here are four things (this is certainly not all-encompassing) to consider before joining in the great poker game that is bidding at foreclosure auctions:

Decide what your goals are. Are you looking for a long or a short term investment?  Long term will mean having your money tied up for longer and a smaller, but steady stream of income (renting the property).   Short term will mean a larger lump sum back with a quicker recovery of your investment and profits (selling the property).

Do your research before and after getting involved. These transactions involve a significant amount of risk.  I highly recommend getting a “lay of the land” before you ever participate.  Go as a spectator a few times – see how the bidding process typically unfolds, see how various people operate, who bids on what.  And once you are “in the game”, extensive research is required for each property you are considering buying.  How much is the property worth?  Are there any title issues that could impact me?  Has the roof caved in on the house?  I can’t stress enough, the importance of having good, reliable information before you bid on a property.

Get your team in place. Some team members you will need are a REALTOR, title company, insurance agent, and a licensed contractor for repairs and/or renovations.

Get your money ready. If you’ve won the bidding on a particular property, a minimum deposit, usually around $15,000-$20,000 will be required immediately.  From there, (typically) you will be required to close within 15 days.  That means getting your cash and/or financing lined up quick.  Keep in mind there are significant monetary penalties if you do not close on time.

Buying properties at auction can be a very lucrative investment.  I advise you to seek the services of an experienced real estate team when engaging in any form of real estate investment.  Please feel free to contact me anytime to see how I can help you invest in Northern Virginia real estate at 703-403-0536 / patrick@patrickduffyrealtor.com.

Stay tuned for future posts with tips on foreclosure auctions and real estate investing.

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Last November, when Congress approved an extension on the first-time homebuyer tax credit, potential homebuyers who missed the original deadline were excited. It was another chance to buy a Woodbridge home for sale and receive an often badly needed $8,000 on their tax return.

Real estate agents were excited as well, because the tax credit extension expanded to include “upgrade” buyers – those who wanted to replace their current home with a bigger one. The possibility of selling a home was higher than it’d been in a while. However, expansion to include upgrade buyers wasn’t the only change.

If you’re hoping to buy a Woodbridge home for sale and take advantage of the tax credit before the new 2010 deadlines, here are a few things to keep in mind:

• Two dates are crucial.  You must sign a contract before April 30.  The closings must be complete by June 30. One of the best ways to make sure things go smoothly is to get pre-approved for a mortgage before you go home shopping. Pre-approval tells you, as well as the seller, exactly how much home you can afford. This way, you don’t waste your time or the seller’s.
• Negotiate without emotion. Potential buyers have lost the home of their dreams because they became competitive. If you’re negotiating for closing costs, housing price or anything else, make sure that your requests are reasonable. Don’t change something “just because.”
• Taxes must be mailed in.  Due to people trying to scam the system, you won’t be able to file your taxes electronically; you’ll have to mail them in. Make sure you’re using the right forms, and, if you need your tax refund by a specific time, you might want to file early.
• Documentation is truly priceless.  Again, thanks to scammers, buyers will have to include a signed mortgage statement, proof of residency and a driver’s license with their taxes.

You still have until April 30 to sign a contract on a Woodbridge home for sale to get the tax credit. Today’s real estate market is beneficial for buyers.  Put it to work for you!

If you’d like to take advantage of the homebuyer tax credit, I can help. Call me right away at 703-403-0536 or email me at patrick@patrickduffyrealtor.com so we can beat the deadlines.

Links:

Approved an extension on the first-time buyer tax credit: http://money.cnn.com/2009/11/06/real_estate/tax_credit_extended/

Get pre-approved for a mortgage: http://personalmoneystore.com/moneyblog/2009/12/03/preapproved-home-mortgage/

Negotiating for closing costs: http://www.lenders.us/mortgage-loans/closing-costs-and-how-to-negotiate-them

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Have you heard of the first-time homebuyer’s tax credit extension? Last month, President Obama signed the extension to help first-time homebuyers (who didn’t get their sales in by November 30th) buy a house that meets their needs. What about those who already own Woodbridge homes, are doing well and want a larger home?

To those who already own a home, Merry Christmas! The Workers, Homeownership and Business Assistance Act of 2009 didn’t just come with an extension; it came with improvements. Those in governmental positions of authority reasoned that if someone wanted to get a bigger home, they should get some kind of help too, thus further helping the overall real estate market.

If you own a home, you can now receive up to $6,500 in tax credits for buying one of the Woodbridge homes for sale. The actual wording is “$6,500 or 10%.” Here are a few of the important points you need to know:

• Income Qualifications – Your modified adjusted gross income (MAGI) as a single taxpayer must be less than $125,000 ($225,000 if you file jointly). Partial credit may be received by those with a MAGI of less than $145,000 (single) and $245,000 (jointly).
• Home Ownership Qualifications – You must have lived in the home you own for five consecutive years out of the past eight to qualify. You do not, however, have to currently own the home you’re using to qualify. The key terms are “five consecutive years” and “in the past eight years.” If you lived in your home for five years straight, but sold it two years ago, you are still eligible for the tax credit. If you’re filing jointly with a spouse, both you and the spouse have to qualify.
• Cost Qualifications – The cost of the home doesn’t have to be more than the home you already own, but it does have to cost less than $800,000. As a side note, the government has put a definitive cap on the housing costs. If the home you’re looking at is a solid, non-negotiable $801,000, it isn’t eligible for the credit.
• Purchase Date – The final date for the purchases to be secured is April 30, 2010. The actual closing date must be finalized before June 30, 2010.

Most couples move into a home thinking they will “eventually” get a bigger home once they have a family. Then the family comes along, the house is full and they can’t buy a larger home due to financial issues. The tax credit is a perfect opportunity for families to find Woodbridge homes that fit their expansion needs. Take a chance and look around; your dream home may be only a city block and $6,500 away!

If you’re looking to expand and take advantage of the tax credit, I can help. Call me at 703-403-0536 or email me at patrick@patrickduffyrealtor.com for more information.

Links:

First time homebuyers: http://www.federalhousingtaxcredit.com/

Modified adjusted gross income: http://www.moneybluebook.com/adjusted-gross-income-and-modified-adjusted-gross-income/

Tax credit: http://www.irs.gov/newsroom/article/0,,id=204671,00.html

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A bankruptcy may stop a foreclosure and allow a homeowner to reorganize his debt and keep his property.  The reality however is that most of the time this is not the case and the bankruptcy only stalls the foreclosure.  If the homeowner is not able to make the payments after bankruptcy the house will foreclose anyway.

The other major drawback to bankruptcy is that it makes it very difficult for the homeowner to sell his property once he enters the process.  It makes it near impossible to negotiate a short sale.  The only possibility is if the trustee of the bankruptcy agrees to release the property from the proceedings and allow it to be sold.

Certified Distressed Property Institute, LLC, 2008

Links:

Bankruptcy: http://www.uscourts.gov/bankruptcycourts/bankruptcybasics.html

Short Sale: http://homebuying.about.com/od/glossarys/g/ShortSale.htm

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I’m very excited to announce that in 2010, I will be increasing the amount donated to the V Foundation for Cancer Research with each transaction I close!  With each home I sell, a donation of up to $500 will be made in memory or in honor of the person of my clients’ choosing.   I truly believe cures for cancer are in reach and I hope this money puts us one small step closer to finding them.

I still find great inspiration watching Jim Valvano’s speech at the 1993 ESPN Espy Awards.  I encourage you to watch it.

Links:

The V Foundation Website:  http://www.jimmyv.org

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A Deed-in Lieu (DIL) of Foreclosure is sometimes referred to as a “friendly foreclosure” since the homeowner essentially gives the Deed back to the bank.  Because this may prevent the bank from go through lengthy (and costly) foreclosure proceedings, they will sometimes forego their right to a deficiency judgment.  The bank agrees to take the Deed back in exchange for the property and the homeowner and back part ways with no further recourse.

This solution often only works when there is only one bank holding a note on the property and there are no significant junior liens on the property.  If the homeowner has equity, this is usually not a good route to take.  Why forfeit your right to that hard earned equity?

As with other foreclosure alternatives, the bank will only accept a DIL if you cannot make your mortgage payments.  Also like the other alternatives, it is often less damaging to your credit than a foreclosure.  Keep in mind, the bank will not present this as an option to you because this has to be done by you voluntarily.  To maximize your chances of your lender accepting a DIL, do not wait too long – approaching them one week before the home is to be auctioned will often not work.

If you or someone you know is falling behind on their mortgage, please call me at 703-403-0536 or email me at patrick@patrickduffyrealtor.com.  I’m here to help!

Links:

Deed-in-Lieu of Foreclosure: http://banking.about.com/od/loans/g/deedinlieu.htm

Deficiency Judgment: http://dictionary.reference.com/browse/deficiency+judgment

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