Monte Gerard

Can anyone help me with phone numbers for the Asset Manager with BOA, controlling short sales?

As posted in the Naples Daily News by Associated Press Sunday November 15th 2009 - Questions that new buyers of a home might ask the seller:

1. Are any appliances under warranty?

2. Do you have product manuals for appliances?

3. Can you provide a landscape plan or a list of outdoor plants and how to care for them?

4. What are the names and phone numbers of immediate neighbors?

5. Are there children living on the street?

6. Where is the school bus stop?

7. What day is trash pickup?

8. What do I do with recyclables?

9. What are your favorite restaurants, video stores and parks?

10. Can you recommend a dry cleaner, mechanic, etc.?

11. What companies did you use for lawn care, snow removal, pool cleaning etc.?

12. Is there an electrician, plumber or technician familiar with the systems in the house?

13. What are the names of the paint colors used in the house?

14. Are there any light switches that operate something unexpected?

Question: Existing homeowner credit: Must the new house cost more than the old house? Answer: No. Thus, for example, individuals who move from a high cost area to a lower cost area who meet all eligibility requirements will qualify for the $6500 credit.

Question: I am an existing homeowner. On October 25, 2009, I signed a contract to purchase a new home. I have lived in my current home for more than 5 consecutive years and am within the new income limits. I will go to settlement on November 20. If President Obama has signed the bill by the time I go to settlement, will I qualify for the new $6500 tax credit? Answer: Yes. The existing homeowner credit goes into effect for purchases after the date of enactment (when the bill is signed). There is no reference to the date of contract for the new credit. The provision looks solely to the date of purchase, which is generally the date of settlement.

Question: I am a first time homebuyer but was not within the prior income limits at the time I entered into my contract to purchase on October 30, 2009. I will be covered, however, by the new income limits. If the new rules have been signed into law by the time I go to settlement, will I be eligible for a credit? Answer: Yes. The new income limitations go into effect as soon as the President has signed the bill. The income limit and other eligibility rules will look to your status as of the date of purchase, which is the settlement date. So if the new rules have been signed when you go to settlement, you should be eligible for the credit (or a portion of the credit if you're within the phase-out range).

Question: I am an eligible existing homeowner. I have a fair amount of equity in my home. I have found a home with a nonnegotiable price of $825,000. Will I be able to use any of the $6500 tax credit? Answer: No. The $800,000 cap on the cost of the purchased home is firm at $800,000. Any amount above $800,000 makes the home ineligible for any portion of the credit. The $800,000 is an absolute ceiling.

Question: I owned my home for 10 years, but sold it two years ago year and have been renting since. If I purchase a home, will I be eligible for the $6500 tax credit if I meet all the other eligibility tests? Answer: Yes. Because you lived in the home for more than 5 consecutive years of the previous 8, you will qualify for the $6500 credit. For example, Say John and his wife bought a home in 2000 and lived there until 2008 when he got a divorce. Whether John has been renting or bought in the interim, he WOULD INDEED be eligible for the credit because he owned a home and occupied it as his principal residence for 5 consecutive years out of the last 8 years. The keyword here is "consecutive." As long as he lived in that house for 5 years straight what he did since 3 years doesn't impact eligibility .

Question: I am an eligible first time homebuyer. I entered into a contract to purchase on November 1, 2009. Do I have to go to closing before December 1? How does the extension date affect me? Answer: You do not have to close before December 1. Once the legislation has been signed, it will be as if the Nov 30 date had never existed. Therefore, so long as the contract is before April 30 and settles by June 30, the purchaser will be eligible for the credit.

Report Shows Inventory Declines 14 Percent

NAPLES, Fla.-November 13, 2009-Overall pending home sales increased at least 100 percent in October 2009 compared to October 2008 in each price category under 2 million, according to a report released by the Naples Area Board of REALTORS® (NABOR), which tracks home listings and sales within Collier County (excluding Marco Island).

"The number of contracts written in October 2009 (904 contracts) was more than twice the number of contracts written in October 2008 (409 contracts). The volume of activity is significant at what is usually a slow time of year," acknowledged Mike Hughes, Vice-President of Downing-Frye Realty.

The properties in the under $300,000 market have led the way in sales for the past few months. However, the market recovery is now working its way up to the higher priced properties. Pending sales in the $300,000 to $500,000 price segment have increased 150 percent from 48 contracts in October 2008 to 120 contracts in October 2009.

The available inventory has declined 14 percent to 9,347 in October 2009 from 10,815 in October 2008.

The October report provides annual comparisons of single-family home and condo sales (via the SunshineMLS), price ranges, geographic segmentation and includes an overall market summary. The statistics are presented in chart format, along with the following analysis:

Overall home sales under $300,000 saw a 42 percent increase with 555 closed sales in October 2009 compared to 392 closed sales in October 2008.

Single-family pending sales increased 73 percent with 475 contracts in October 2009 compared to 274 contracts in October 2008.

Condo sales increased 49 percent with 254 closed sales in October 2009 compared to 170 closed sales in October 2008.

The overall median closed price decreased 14 percent to $190,000 in October 2009 from $221,000 in October 2008.

The median refers to the middle value in a set of statistical values that are arranged in ascending or descending order, in this case prices at which homes were actually sold. It should be noted that in any given period the median could vary greatly if there is an anomaly, a single sale that is significantly higher or lower than other properties in the area

If you think that now may be the time to pursue buying a property in Southwest Florida ie Lee and Collier Counties...you may be right. Prices are back to the levels of 2000-2002 and it's a great time to be a 2^nd home or investment purchaser. However, there are several things that you should know before jumping into the buyer foray and they are below

1. Trying to do it on your own - Get a real estate agent...it doesn't cost you anything to hire one. Interview your prospective real estate agent just like you would when selecting your attorney or CPA. It's important that you know your agent is actively licensed in the state of Florida, and a member of their local real estate board (in order to be a realtor, you must be a local board member as well as a state and local board member.) Also, make sure that they have plenty of experience, a full time commitment to their career (no part-timers recommended), education which may include additional accreditations, college or advanced college degrees. Having a buyer's representation contract with the agent you select is a good idea. Remember that your agent is paid by the seller or the bank (if short sale or REO) so having this protects you. For a copy, email me at monte@montegerard.com and we'll send you one for your review.

2. Buying Foreclosed or REO (Bank Owned) Property - This is by definition, property that has been foreclosed on by the lender and is now listed on the market for sale. Look for properties that were built in 2004-2006 and that will be your target years. The good news is that the properties will be newer and the bad news is that they will be further east of the beach. Currently there are about an average of 350-400 foreclosed properties on the market at any given time out of 12,000 active properties so it's a small percentage. Websites like www.foreclosure.com will sometimes list properties once they've been foreclosed but before they are "on the market". There are preliminary steps that the bank and the assigned realtor will have to go through in order to prepare the listing for the market. Also, the bank's price is what the bank wants. They don't want to hold onto the property for long and in a declining market; they need to get rid of it so there's not a lot of negotiation. This is where your selected realtor can give you a comparative market analysis of the value. If it's overpriced, then it will stay on the market and you may be able to make an offer once the price changes, if not it's gone in a matter of hours. Be prepared to make your offer, have your financing arranged (cash is KING), and that you'll probably have to put some money into the property to bring it up to your usage or as a rental investment. I could do an entire article on this area but email me at monte@montegerard.com for details.

3. Buying a short sale-This is a pre-foreclosure phase and it most simply means that the loan on the property is higher than the value of the property. The seller is seeking a settlement with the bank that will be "short" the loan amount. Once you make an offer, make sure that it's accepted by the seller with the contingency that it will need the lender or lender's approval if more than one. It's a complicated process and most of the work falls on the shoulders of the listing agent to get this approved by the bank. Make sure that your agent knows the experience and ability to get these done. Don't be in a hurry or on a time schedule to get a short sale because they will take 30+ days to get approval. A great description of the process is at www.wikipedia.com. Just search short sale.

4. Not having your financing arranged - Be upfront with your agent about your financing of the property. If you are going to get a mortgage on the property, make sure that you have met with a bank or mortgage broker to get "prequalified" which means that you have met the basic parameters of the bank's requirements to get a loan and you have a letter from them stating this preliminary acceptance. If you are paying cash, then make sure that your money can be liquidated fairly quickly and transferred. You'll need to get a "proof of funds" letter which is either a personal letter from your banker or broker that says you've got the money in your portfolio or a statement with the funds to close. These will have to accompany any foreclosure or short sale offer and a lot of normal deals are requiring it as well.

5. Not conducting a thorough inspection - You should always conduct an inspection within the time period allotted so that you know what you're getting into on a property. Even if you are buying the property "as-is", you have rights to an inspection. Many properties that are distressed properties or older properties have problems that are easy to detect like missing appliances, air conditioners or well pump equipment. Some not so easy may be postponed maintenance, roof issues or damage, mold or Chinese drywall (normally this is possible if the home was built after 2002).

6. Not understanding the contract and knowing the contingency dates-Once the negotiation is finished, make sure that there is an executed contract in which all counters have been signed or initialed where needed. Once finished, then agree on a date of the executed contract and your agent should set the "due by" dates for the inspection, the mortgage contingency waiver, survey, inventory of personal property if included, earnest money deposits, inspection reply and closing date. If it's a short sale or foreclosure purchase, then these usually start once you get the bank's approval.

7. Not verifying Title issues-Since so many closings were speedily done in the 2004-2006 period, the mistakes on the re-sales have been popping up. You may have to get signatures from past sellers, you may have to verify that doc stamps and recordings have been done on the property, or there may be estate issues that need resolution from the IRS (6 weeks minimum). You can get these issues clarified even before you make an offer on the property.

8. Not understanding the HOA-Gated and deed restricted communities are very popular in this area which means that there are restrictions on your ownership. You may not be able to park your truck or RV at your home or condominium. Make sure that you know the pet policy if you want to bring your pet. Know the rental policy if you intend to rent the home. Make sure that the seller or bank has paid any past dues to the association. Apply to the homeowner association if it's mandatory as soon as you have an executed contract. Not having the Homeowner's Association approval is a common pitfall that holds up a lot of closings.