Jennifer Fidler

Senators Agree To Extend Homebuyer Tax Credit
Proposed Plan Would Give Repeat Buyers Reduced Tax Credit
STEPHEN OHLEMACHER, Associated Press Writer
POSTED: 2:32 pm PDT October 28, 2009
UPDATED: 4:11 pm PDT October 28, 2009

WASHINGTON -- Senators agreed Wednesday to extend a popular tax credit for first-time homebuyers and to offer a reduced credit to some repeat buyers.
The tax credit provides up to $8,000 to first-time homebuyers but is set to expire at the end of November. The Commerce Department said Wednesday that new homes sales fell 3.6 percent in September, and some industry representatives blamed uncertainty about the tax credit.
Senators agreed to extend the existing tax credit for first-time homebuyers while offering a reduced credit of up to $6,500 to repeat buyers who have owned their current homes for at least five years, said Regan Lachapelle, a spokeswoman for Senate Majority Leader Harry Reid, D-Nev.
The tax credits would be available to homebuyers who sign sales agreements by the end of April. They would have until the end of June to close on their new homes, according to a summary of the legislation being circulated among lawmakers.
Senators were still negotiating the expansion of a separate tax credit that lets money-losing businesses get refunds for taxes paid in previous years, providing them with an immediate source of cash.
Senators in both political parties were hoping to add both tax provisions to a bill that would give people running out of unemployment insurance benefits up to 20 more weeks of federal aid. The Senate could vote on the overall bill as early as Thursday, but lawmakers were still haggling over several unrelated amendments Wednesday evening.
Popular bills like the one to extend unemployment benefits often attract amendments that would have a difficult time passing on their own.
Republicans were demanding that they be given a chance to offer amendments to restrict federal aid to the beleaguered community activist group ACORN and on requiring that people receiving unemployment insurance be processed through E-Verify, an Internet-based system that employers use to check on the immigration status of new hires.
Majority Democrats have refused to add the amendments.
If the Senate passes the bill, it would go to the House, which passed a similar bill extending unemployment benefits last month. House leaders have also said they support extending the tax credit for homebuyers.
Sen. Chris Dodd, D-Conn., has been negotiating for several weeks with Sen. Johnny Isakson, R-Ga., to craft an extended tax credit for homebuyers that would pass the Senate.
Lawmakers didn't release a cost estimate for extending the tax credit, though similar proposals were projected to cost about $10 billion.
Industry representatives said uncertainty about the tax credit is hurting new home sales. September's decline was the first since March.
It takes 45 days to 60 days to close on a house, making it unlikely a sale made today would be consummated by the end of November, said Lucien Salvant, spokesman for the National Association of Realtors.
"Buyers right now have an incentive to hold off, not knowing whether the credit will be extended," Salvant said.
About 1.4 million first-time homebuyers have qualified for the credit through August. The National Association of Realtors estimates that 350,000 of them would not have purchased their homes without the credit.
The tax credit for money-losing businesses is a favorite among Republican lawmakers. Businesses could get tax refunds by using losses from 2008 and 2009 to offset taxable profits made in the previous five years. Under current law, they can only offset profits from the previous two years.
The provision would help a variety of industries, including retailers, manufacturers and home builders, though it's expensive.
"It's clearly a way to put cash in the hands of some major economic players," said Clint Stretch, a tax policy expert at Deloitte Tax.
A similar proposal that was ultimately dropped from the economic stimulus package enacted in February would have cost nearly $20 billion over 10 years. Lawmakers are working to reduce the price tag.
"Because everybody is so cash strapped, this is a good way to get refund when businesses need it for operating expenses," said Rachelle Bernstein, vice president and tax counsel for the National Retail Federation.

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I would say that now a days 90% of the calls I get are on people wanting to buy a foreclosure or a short sale. They are out there and, for the right buyer, they might be a good deal. But, what if you are a seller facing a possible foreclosure? Do you know where to turn and what to do? Have you considered a short sale? Recently, I received a designation as a Certified Distressed Property Expert (CDPE). I have seen first hand the stress and devastation families are going through when facing a foreclosure. I've also seen what a nightmare they can be if the real estateagents representing those sellers don't know what to do and how the process works. I am saddened by what I am seeing all around me and the distress that people are in when they can't make their payments. I am going to be blogging more about what to do if you are facing a foreclosure over the coming weeks. To start, I thought I would include some information on short sales vs. foreclosures. I think that there are a lot of misconceptions out there about what a short sale is, if a short sale is successful there are a lot of benefits. In a foreclosure, you won't be able to buy another home for 5 to 7 years, vs. a short sale where you can buy again in two years. Foreclosures can lower your score anywhere from 250 to 300 points and can affect you for three years. You can do a short sale with as little as a 50 points off your current credit score and the affect on your credit can be as little as 12-18 months. Foreclosures stay on your credit history for 10 years, short sales are not reported. If you ever fill out a 1003 (the application to get a new loan for a home) you must disclose if you EVER had a foreclosure, there are currently no questions regarding a short sale. This is one that I never even thought of until recently, but foreclosures can affect your employment both currently and in the future. Military personnel, police officers, CIA, bank positions or anything that requires a security clearance, security clearance can be revoked and the person can be terminated from their position!! Short sales typically do not challenge most security clearances. If a person has or is applying for a position where credit can be checked, foreclosures will come up and could affect a person's current job or a job they are applying for in the future. Lastly, in 100% of all foreclosure cases, the bank had a right to pursue a deficiency judgement, meaning that the difference that the bank made on the sale of the house vs. what the person who owned the house owed, can be attached to the person as a deficiency judgment, making them responsible for the amount the bank lost. In a properly negotiated short sale, the seller, with their agent, can negotiate with the bank so that home owner is not responsible for the deficient amount. There is a lot to consider and if you are thinking you may be facing a foreclosure, you have to have a hardship and build a case to the bank, its work but absolutely worth what you are saving yourself in the future, your credit your job security and future judgments against you. Consider a short sale and talk to a qualified professional.

So, as many of you may know if you have been watching the news, our elected officials are going to be voting on an Economic Stimulus Bill, which has provisions in it for potential home buyers to get a $15K tax credit for purchasing a home and a fixed 4% interest rate. I personally feel that this would be great news if this would voted in and feel that anything we can do to help stimulate the housing market will have a huge effect on our economy. So, please take the time to read this article below, Dave Liniger from RE/MAX says it better than I do, this article is compliments of him. If you are interested in writing to your represenatives or senators, here are the web addresses to do so. It will only take a few minutes, let your voice be heard! I will update this as soon as I hear the final outcomes on the voting, stay posted

http://www.senate.gov/

http://www.house.gov/

Urgent Message from Dave Liniger

If you have been watching the news this week, you may have noticed that the debate in Washington has finally turned toward real stimulus for the housing industry. As a result, I believe that we could be on the brink of a substantial turn around in the real estate market. Now, it's critical that we all join together and deliver a powerful message to our legislators that we support this stimulus.

Last night, the Lieberman/Isakson Amendment was included in the senate version of the Economic Stimulus Bill by a unanimous voice vote. This amendment would provide a Tax Credit to all home buyers at the rate of 10% of the sales price up to a limit of $15,000. The credit would be available for a one year period to all purchasers of primary residences.

Today, the senate expects to debate Amendment 353, a proposal by Senator John Ensign (R-NV) that would provide 30 year fixed financing at a rate of about 4%, for anyone purchasing a primary residence.

If these two provisions survive in the final passage of a stimulus bill they could have a tremendous impact on our industry. If they are coupled together with provisions to ease the flow of credit and reduce foreclosures, we could see an immediate and dramatic turn-around in real estate.

I feel that these provisions represent real economic stimulus. They will put money in the hands of millions of homeowners, increase sales, stabilize home values and add more revenues to local communities in the form of property taxes.

I urge each of you to contact your senators and representatives to let them know that you believe these provisions are essential components of any stimulus bill. You can go to the official Senate and House web sites to locate the email and phone number of your legislators.

This may be one of the most critical moments for the real estate industry in our time. Please pass this information on to anyone you might do business with. The outcome of this legislation will have a lasting impact on us all. I appreciate your assistance on this urgent matter.

Thank you.

Albany:

Average Days on Market 145

343 Currently Active Properties

Average Price per Sq Ft. $124

Average Sales Price $194,490

North Albany:

Average Days on Market 158

89 Currently Active Properties

Average Price per Sq Ft. $139

Average Sales Price $308,836

Corvallis:

Average Days on Market 114

278 Currently Active Properties

Average Price per Sq Ft. $164

Average Sales Price $301,363