Jodi Thorsen

Time is running out for home buyers looking to purchase their first home and qualify for the $8,000 Federal tax credit. According to the National Association of Home Builders (NAHB) first time home buyers looking to purchase a new home in 2009 and take advantage of the $8,000 first time home buyer tax credit, should do so immediately in order to qualify.  For the full article, go to eliving.

June Schlesinger

Lohi Lofts, located in the heart of Northwest Denver’s Lohi neighborhood is a chic and sensible community geared to those seeking socioeconomic balance within Denver’s urban core. Nobel Developers and Live Urban Real Estate bring you a condo conversion where art meets architecture, literally blending modern sculpture, loft design, and architectural savvy. Lohi Lofts delivers a creative and original condo community all within a first-time homebuyer’s reach. The modern living experience can be rich without being expensive.  Due to the recent changes in lending on new condo projects and condo conversions, there is an increased demand for FHA approved condos in every market.  Conventional loans require a 10% downpayment on condos whereas FHA only requires 3.5%!read more about it here.

Mic Ortega

With the current housing crisis affecting more and more homeowners, many borrowers having trouble making payments are surprised to learn that foreclosure is not the only option.The Federal Trade Commission outlines the following alternatives to foreclosure, depending on a homeowner’s financial situation and existing type of loan:

Reinstatement The borrower pays the lender the entire past-due amount, plus late fees and penalties, by an agreed-upon date.Works best for: Solvent borrowers whose payment problems are temporary.

Repayment Plan The lender gives the borrower a fixed amount of time to repay past-due payments by adding a portion of them to the regular payment.Works best for: Solvent borrowers who have missed a small number of payments.

Forbearance Mortgage payments are reduced or suspended for an agreed-upon period of time. At the end of that time, the borrower resumes regular payments plus a lump sum or additional partial payments for a number of months to bring the loan current. Works best for: Solvent borrowers who are facing a temporary income reduction (for example, are on disability but will resume full time work).

Loan Modification The borrower and lender agree to perma-nently change one or more terms of the mortgage contract to make payments more manageable. Modifications may include reducing the interest rate, extending the term of the loan, or adding missed payments into the loan amount. Some lenders may forgive or cancel a portion of the debt. Under the Mortgage Forgiveness Debt Relief Act of 2007, the forgiven debt may be excluded from income when calculating federal taxes owed, but it still must be reported on the federal tax return.Works best for: Solvent or insolvent borrowers who are facing long-term income reduction or increased ARM payments.

Sale The homeowner sells the property and pays the lender the full amount due on the note. Some lenders may postpone foreclosure proceedings if there is a pending sales contract or if a borrower lets them know they are putting the home on the market.Works best for: Solvent borrowers whose homes are worth as much as loan balance plus any expenses related to selling the home (real estate agent fees, for example).

Short Sale The lender allows the property securing a mortgage or deed of trust to be sold for less than the existing loan balance. A short sale is really a form of preforeclosure and occurs when the lien holder agrees to accept less than the loan amount to avoid the foreclo-sure process. Works best for: Insolvent borrowers and those whose homes are worth less than the amount of the mortgage.

Deed-in-Lieu With the lender’s agreement, the homeowner voluntarily transfers property title to the lender in exchange for cancellation of the remainder of debt. Although the homeowner loses his home and equity, a deed-in-lieu is less damaging to the borrower’s credit than a foreclosure. Works best for: Borrowers whose loan amount is equal to or greater than what the home would sell.

Bankruptcy Personal bankruptcy is generally considered a last resort because the consequences are far-reaching and long-lasting. A bankruptcy stays on a credit report for 10 years, making it difficult to get credit, buy another home, purchase life insurance, or even get a job. Still, for some, this legal procedure offers a fresh start to someone who cannot repay their debts. If a homeowner has regular income, a Chapter 13 bankruptcy may allow them to keep their property. Works best for: Insolvent borrowers who cannot pay their debts.

FHA and VA alternatives Homeowners with an FHA or VA mortgages may have other foreclosure alternatives.  Contact FHA or VA to learn more.

The FTC also advises homeowners to be aware of the following scams:

• The foreclosure prevention specialist: A phone counselor charges high fees to make phone calls or complete paperwork that the homeowner could easily do for himself. Some of these companies use the words HOPE or HOPE NOW in their names in order to confuse borrowers who are looking for assistance from the free 888-995-HOPE hotline. (Buyers interested in this program can learn more at coloradoforeclosurehotline.org. Colorado hotline is 1-877-601-HOPE.)

• The lease/buy back: Homeowners are deceived into signing over the deed to their home to a scam artist who tells them they can remain in the house as a renter and eventually buy it back. Usually, the terms make the buy-back impossible, the hom-eowner gets evicted, and the purchaser walks away with equity.

• The bait-and-switch: Homeowners think they are signing documents to bring their loan current. Instead, they discover too late — usually when they receive an eviction notice — that they have signed over the deed to their home.  Homeowners facing the possibility of foreclosure should be proactive in contacting their lender, accountant, and/or attorney to discuss their situation.

Make sure to visit the Live Urban Real Estate Resource Center for more valuable real estate information.

John Skrabec

Bring your lawn chairs, blankets, and picnic goodies for a fun-filled night watching a movie in one of Denver’s beautiful urban parks. The Denver Parks and Recreation department is hosting its fourth season of Movies in the Parks.  There are ten family-friendly movies scheduled all summer long to encourage people to get out, enjoy their parks and the beautiful summer weather in Colorado. See more info here!

Sue Perrault

First time home buyers are hearing it shouted from the rooftops “NOW IS A GREAT TIME TO BUY!!”  But for those that are just starting to consider the possibilities of home ownership, where do they begin to sort out all the information.  Tax credits, low interest rates, lower home prices are all amazing incentives for first time buyers, but finding out what really is the best deal, how to take advantage of all of the incentives, and just where to start can be overwhelming.  To begin the process you need to get educated!  Check out this informative article from Kiplinger to get you on your way to owning your dream home!

7 crucial tips for first-time buyers: If record-low mortgage rates and plummeting housing values have you primed to get into the market, don’t get antsy — get educated. Click here for some essential steps to take when buying your first home!

Mic Ortega

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As we keep hearing, there has never been a better time to buy for first time buyers.  But what about move-up buyers, those wanting to sell their current home and buy something larger?  By doing the math, it appears the timing couldn’t be better either.  In a recent MSNBC article: Move Up Buyers, the value of moving up in this market is revealed.

According to the artcile, if you’re in a $200,000 house and you lost 18 percent, that means you lost $36,000. But if you’re moving up and buying a $500,000 house, that person just took a $90,000 loss, so you can see you’re making $54,000.  By doing the math, taking a loss on the sell of your home might actually be the best investment decision right now.

Walt Maloney of the National Association of Realtors points out, “The affordability conditions are optimum right now.  We will be seeing a little pressure on rates later this year. It’s really hard to time the bottom of the market, which will be apparent in hindsight. If we aren’t at the bottom of interest rates now, we’re within an eighth of a point.”  And while rising prices can push affordability down, rising interest rates can work against would-be buyers much more quickly. A one-point hike in interest rates boosts monthly mortgage payments the same as a 10 percent increase in prices.

By doing the math, being able to say you lost $20,000 on the sale of your home, but saved $40,000 on the house you never thought you could afford begins to makes sense.  Combined with the incredible interest rates and the flux of first time buyers in the market right now, moving-up starts to make more sense.  Timing is everything in Real Estate and despite what the national media is saying, now may be the time, especially for move-up buyers.

Kathi Spencer

 Not only does owning a home give you a haven for yourself and your family, it also makes great financial sense because of the tax benefits — which you can’t take advantage of when paying rent. The following calculation assumes a 28 percent income tax bracket. If your bracket is higher, your savings will be, too. Based on your current rent, use this calculation to figure out how much mortgage you can afford.

Rent: _________________________

Multiplier: x 1.32

Mortgage payment: _________________________

Because of tax deductions, you can make a mortgage payment — including taxes and insurance — that is approximately one-third larger than your current rent payment and end up with the same amount of income.

For more help, use Fannie Mae’s online mortgage calculators.

Mark White

All of us have been watching what’s happening in the housing market with a mixture of fascination and fear.  It’s no wonder that many people are finding it hard to make a decsion to buy or sell.

Stacie Staub

We’re feeling the recovery every day around here - downtown, in NW Denver, and even in Golden, Arvada, and Wheatridge, among other Metro areas.  Low inventory, low prices, low rates and rising demand are all helping to jump-start movement in D-town, and it’s even starting to feel like FLIPPING will pay off big time if done right!

Check out this article from BUILDER magazine:

John Burns always seems to be step ahead of the pack when it comes to forecasting the housing market, especially local demand. Among the first analysts to write that a major price correction was necessary before the market would rebound, Burns has since developed a local market forecasting tool.

Dubbed Housing Cycle GPA, the analytical model considers 29 years of history to determine a local market’s health. The primary drivers are local demand, supply, and affordability, along with what’s happening in the national economy. When two of the three local fundamentals rise, that usually means price appreciation is likely to occur, sometimes immediately, in other cases, over several years.

We asked the analysts at John Burns Associates to use the model to determine which five major home building markets might recover first. They produced a list that includes some metro areas with strong job formation, others where home builder competition is almost nil, and still others where price declines have made homes quite affordable.

1.Washington, DC. Burns’ bullishness on this market boils down to a single word—jobs. “If a sector will be hiring, it will be the Federal government,” he says. D.C. was also among the first markets to have a price correction. “Within a reasonable commute of the Capitol, homes have become very affordable and supply is constrained.”

2.San Diego, Calif. “Most of the home builders and speculators have left town, and left a very supply-constrained market behind. The biotechnology sector is likely to lead an economic recovery that will be characterized by great affordability (by San Diego standards) and a lack of supply.”

3.Sacramento, Calif. “Although we expect housing demand in Sacramento to remain low due to state fiscal issues, much of the excess supply in both new and resale homes has been cleared out, and affordability is fantastic.”

4. Dallas, Texas. “Assuming mortgage rates remain low and GSE lending doesn’t change, Dallas’ housing market should stabilize due to increased demand from people relocating from the west to one of the most affordable markets in the country. North Dallas should recover long before South Dallas.”

5. Denver, Colo. “One of the best places to live in the country, Denver was just recovering from the telecom bust when it got hit by the national economic downturn as well. Housing is extremely affordable and foreclosure activity, which used to lead the country, is now much lower than most other areas of the country.”

Read the rest of the article.

Mic Ortega

It seems like almost every time I go out showing properties these days I run into a “short sale” and I always get the question, what is a short sale?  In simplest terms, a short sell is when a seller facing the threat of foreclosure enters into an agreement with their mortgage lender to accept a price for the property that’s less than the amount they actually owe on it. The seller makes no profit on the sale but avoids many of the problems that would come from a foreclosure.

According to Freddie Mac, it costs the typical bank about $60,000 to foreclose on a property.  This does not take into account the amount they must discount the price of the home to eventually resale it.  In theory, banks should be more than willing to accept a short sale from the owner of the home and cut their losses.  Of course, this isn’t always the case and as many agents will attest, getting a short sale from time of contract to close is possibly the most difficult real estate transaction.

Possible Advantages

For the seller, a short sale limits the negative impact on their credit score.  For buyers, a successful short sale usually results in purchasing a home for under market value, sometimes significantly.

Potential Pitfalls

Not all sellers will qualify for a short sale. Some banks require there to be missed payments before they will even discuss a short sale.  And while the impact to ones credit score may not be as severe with a short sale, there is no guarantees of it being less severe than a foreclosure, so it is important to discuss the implications of a short sale with a qualified lender and tax consultant.  The biggest key for a buyer is patience.  The short sale process can easily take between 3 and 6 months to complete and even then there is no guarantee the bank that owns the mortgage will agree to the discounted price.  Regardless, a short sale can be terrific solution for a seller and for a buyer.  Make sure to consult your Live Urban Real Estate agent to decide if a short sale is right for you.