Fisrt Time Home Buyers – Please Read!!

Lower inventory has caused more competition for the homes that are currently on the market. Just like this article explains, I tell my clients if you see something you like we need to make an offer, and a good offer, immediately or the home will go to another buyer. If you have more questions on what is going on in our market please feel free to give me a call at 813-777-5332 or visit me on the web at

First-time homebuyers may have to compromise

BOYNTON BEACH, Fla. – Jan. 10, 2013 – After about six months of looking, Richard Mallek and his wife, Susan, are ready to close on their first home, a three-bedroom sanctuary with old Florida charm in Boynton Beach, Fla.

Before the couple began their search last summer, they paged through “The Insider’s Guide to Home Buying,” a book written by the Zuckerman family, which owns a Coconut Creek, Fla.-based real estate company.

“It opened our eyes about what we were getting into,” said Richard Mallek, 32. “We found out the closing costs could be just as much as the downpayment. So we buckled down, cutting back on going out to dinner and for drinks.”

First-time buyers like the Malleks gradually are playing a larger role in rejuvenating the housing market. First-timers boost demand, which allows existing homeowners to sell and move up to bigger properties.

For the 12-month period ending in June 2012, 39 percent of sales nationwide involved first-time buyers, compared with 37 percent a year earlier, according to the National Association of Realtors.

Five years ago, in the middle of the housing bust, first-time buyers had a glut of properties to choose from, little competition and plenty of leverage when it came time to submitting offers.

Not anymore. The housing inventory is down sharply, investors are pouring money back into real estate and sellers are eager to accept those cash deals.

Brokers insist that buyers get pre-approved for a specific amount of money before starting their search. When a home in their price range hits the market, they should plan to see it that day – on their lunch break, if necessary – and offer full price or above in many cases.

Here are other strategies that first-time buyers can use to their advantage:

• Broaden the search, even just a little. Many first-time buyers target a specific city, but the lack of inventory limits options, agents say. Buyers “have to be flexible and compromise,” Broward County, Fla., agent Chip Rowand said.

• Don’t automatically settle for a Federal Housing Administration mortgage. Many first-time buyers lean toward FHA loans because of the low downpayments – just 3.5 percent of the purchase price.

But in today’s market, sellers fielding multiple offers prefer cash or conventional loans, which usually don’t have as many restrictions as FHA, said Stephen B. McWilliam, president of Greater Fort Lauderdale (Fla.) Realtors.

For clients who need financing, McWilliam recommends conventional loans that require just 5 percent down. Sellers will view them as more financially stable and even save money on mortgage insurance costs, he said.

• Seek a lender that can process the loan quickly. McWilliam said some big banks won’t sign off on mortgages for eight to 12 weeks – too long for most impatient sellers. Consider working with a community bank or a local mortgage banker, which typically don’t have as much bureaucracy.

“If we have to do it in eight business days, we will,” said Jim Flood, regional manager of Supreme Lending in Plantation, Fla.

Copyright © 2013 Sun Sentinel (Fort Lauderdale, Fla.), Paul Owers. Distributed by McClatchy-Tribune News Service.


Related Topics: Buyer services

Mortgage Forgiveness Debt Relief Act Extended to 2014

Who should care if the Mortgage Forgiveness Debt Relief Act was extended? Anyone who is in process or may be considering a short sale. You see some lenders use a 1099 to get rid of the loss. They 1099 the seller of the home who would then be responsibe to pay taxes on the difference between what they owed on the home and what it actually sold for. The Mortgage Forgiveness Debt Relief Act allows person to avoid paying the tax as it is really income they never received in the first place! It’s complicated, but needed to protect those who short sale their homes. If you know anyone in the Tampa area that is considering short saling their home please tell them to contact me for a free consultation. I have the CDPE designation or Certified Distressed Property Expert and can help them to understand the process. See me on the web at




Florida Realtors® News” src=”” thid=”fc75a32f-32ea-48b4-a297-2ef39d1d51bb”>
Daily Briefing: Wednesday, January 2, 2013
A service for members of Florida   Realtors

Special       Report: Real estate provisions
in ‘fiscal cliff’ bill

WASHINGTON – Jan. 2, 2013 – Yesterday, the House and Senate passed H.R.       8, legislation to avert the so-called “fiscal cliff.” Following       are real estate-related provisions of the bill, which President Obama       plans to sign into law today:

Mortgage Forgiveness Debt Relief Act extended to January 1, 2014. In       place since 2007, the act provided a tax break for homeowners who       struggled through financial hardship such as a foreclosure, and were       granted mortgage debt forgiveness. In the past several months, National       Association of Realtors (NAR) issued numerous calls to action urging its       million-plus Realtor members to ask lawmakers to extend the tax break for       another year. More than a quarter of all transactions involve distressed       properties, the NAR said in its plea. “Homeowners shouldn’t be       forced to pay a tax on money they’ve already lost with cash they never       received.”

Deduction for mortgage insurance premiums for filers making       below $110,000 is extended through 2013 and made retroactive to cover       2012.

The 15-year straight-line cost recovery for qualified leasehold       improvements on commercial properties is extended through 2013 and made       retroactive to cover 2012.

The 10 percent tax credit (up to $500) for homeowners for energy       efficiency improvements to existing homes is extended through 2013       and made retroactive to cover 2012.

“Pease limitations” that reduce the value of itemized       deductions are permanently repealed for most taxpayers but will be       reinstituted for high-income filers. “Pease” limitations will       only apply to individuals earning more than $250,000 and joint filers       earning more than $300,000. The thresholds are indexed for inflation so       will rise over time. Under the formula, filers gradually lose the value       of their total itemized deductions up to a total of a 20% reduction.

First enacted in 1990 and named for Ohio Congressman Don Pease, who       proposed the idea, the limitations continued throughout the Clinton       years. The limitations were gradually phased out starting in 2003 and       eliminated in 2010. Reinstitution of these limits has far less impact on       the mortgage interest deduction than a hard dollar deduction cap,       percentage deduction cap or reduction of the amount of mortgage interest       deduction that can be claimed.

The capital gains rate remains at 15 percent for individuals       earning less than $400,000 per year and couples earning less than       $450,000.  Any gains above these amounts will be taxed at 20       percent. The $250,000/$500,000 exclusion for the sale of principle       residence remains.


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