Las Vegas is a gambling town but even the pros know you shouldn't push your luck- especially with a sure thing. The $8,000 first time homebuyer tax credit is assured to any creditworthy person who has not owned a home in the past three years. The main way to blow this pile of cash is to wait too long. The November 30, 2009 deadline is fast approaching. It may look like you have three months to play with, but this year there are other factors at play. If you wait too long, you will loss $8,000. This true anywhere but there are additional issues that are specific to Vegas.
Mortgage loans are available at historically low rates but getting one is trickier than in the past. Just as the credit itself was put in play by depressed conditions in the housing market, sloppy credit practices in the past set the stage for current mortgage drama. Lenders mandated to prevent the abuses of the past now have escalated the requirements to get a loan. Requirements among lenders vary, so a smart buyer needs to be pre-approved for a certain dollar value of mortgage before even starting the buying process. Buyers must present W-2s, paystubs, savings statements, perhaps credit card statements or other records of debt to the lender who does a credit check. The process is automated, but a buyer who meets the requirements has the bank's statement of how much house to look for. A buyer who doesn't make it has to find another lender, find a way to improve their score, or postpone their plans. All of this takes time while the clock for the credit is ticking.
A very few first time buyers buy a multi-million dollar started home, but most aim for more affordable, less expensive homes. These are the homes that are moving first everywhere, but in Las Vegas, there is a lot of competition from foreign buyers or cash buyers who are aiming to invest in the same group of homes the first time buyers want. This could result in a bidding war or a lost opportunity that signals the buyer to keep looking. Finding a home in a desirable area that meets the bank's price range can be a time-consuming search.
Armed with a sales contract, the would-be buyer is closer to ownership but new Federal disclosure laws and new appraisal policies further elongate the process. Intended to accurately assess property values and communicate the true value of the home and the true cost of credit, the new laws add three days here, five days there - a potential issue if it is getting close to November 30. New appraisal regulations pose a whole set of issues we will discuss in an upcoming blog; suffice it to say that appraisers from out of the Clark County area could be inaccurately assessing Vegas properties with no input permitted from real estate agents or lenders. The resulting appraisal could come in out of sync with what the bank is willing to lend for; this often means that the buyer is scurrying to lay hands on extra money or sent shopping for another appraisal or another lender. The risk here is even greater in Vegas where inflated housing dropped precipitously in value over the last couple years. Both time and money are at stake.
The $8,000 tax credit is a sure-thing opportunity for buyers to offset their housing costs. If you want to be winner in this unique tax-credit jackpot, it's time to get the process in motion. there's talk that the credit will be extended. Right now, that is on on the table so you still need to act now.l
Yonas Woldu is ready to help you claim your prize. He can help you find an affordable house in Las Vegas, Green Valley, or other areas of Clark Countyand help you navigate the system. If you are looking to purchase a home, including a short sale or bank owned home, visit Vegas Real Property website and my new AskYonas website.
For every real estate problem, I have a solution. Now let's make it happen.
If you're a Las Vegas homeowner with financial problems that you expect to overcome soon, you may have a different agenda than someone who sees selling their home as the only way to escape foreclosure. Assuming your home is one you like, want to keep, and can afford, talking with your lender in time of need may reveal a number of options. Foreclosure is costly for lenders, so if you approach them in a timely manner, they may be willing to provide some temporary relief or "workout" for the problem.
Most people these days know the big three weapons that lenders use to prevent further loss but there is a lot more in the lenders' arsenal than foreclosure, short sale or deed-in-lieu. Less final remedies for troubled homeowners include modifying the length of the loan or the interest rate, waiving penalties and fees, deferring payments to the end of the loan and making it longer, applying past due amounts to the loan balance and slightly increasing each monthly payment, hold a fixed rate on a loan ready to adjust, lengthen an introductory payment or interest rate, or even granting temporary forbearance to stop the payments.
Banks, not being social service agencies, do not widely advertise this "softer" side; in order to bring it out and allow a workout, you need to make a good case for yourself to make the lender confident that this will stop further loss. As is true with all credit issues, contact your lender at the first sign of trouble. Your steps might include:
• Explain why you are in trouble and why you think the problem is temporary. If a change in the interest rate is causing your payment to adjust upwards, you need to show evidence you paid in a timely manner before change. If your problems were caused by job loss, illness, or family circumstances, you need to show that it is likely you will have a job soon or that the crisis has passed.
• Show proof that you have been trying to work things out on your own, through job hunting, part time jobs, or by reducing your living expenses.
• Present a specific proposal to the bank, with alternatives, both verbally or in writing. If you do not know what to propose, you might seek ideas from a non-profit housing counselor, a real estate attorney, CPA, or other qualified source. A typical request might suggest lengthening the loan, making it fixed not adjustable, and lowering the interest rate. If your proposal will lower your payment by $500 per month, you need to show how this will help you catch up and be on time in the future. What will sweeten the pot if you are way behind is to present least a month's payment.
Good preparation will increase the chance that the lender will accept your proposal.. Make sure to discuss with the lender representative how the new agreement will affect your credit record. Your goal is to have your new payments reported to the credit bureau as "Pays as agreed, " but make sure you understand the credit ramifications before you finalize the terms.
Have a complex real estate situation? Yonas Woldu can help. For help with selling or buying property in Las Vegas, Green Valley, or other areas of Clark County, contact Yonas Woldu at Prudential Americana Group. I can help you find alternatives. If you are looking to purchase a short sale or bank owned home, visit Vegas Real Property website and my new AskYonas website.
For every real estate problem, I have a solution. Now let's make it happen.
If you are at risk of foreclosure, you aren't in a hopeless situation, but no question about it, time is of the essence. As soon as you realize you are headed for trouble, it's time to develop a game plan. Your strategy will vary according to what you want to do and what you can do. If you realize that you can't afford the home and the costs to maintain it, a quick sale of your Las Vegas home might be the best course of action.
In these times, that may sound like a cosmic joke, but even now, sellers have control over three things: pricing, marketing, and condition. The price of control is abandoning the thought that you will necessarily be able get top dollar for the home. You must keep in mind that the goal is to unload the house so you can avoid foreclosure and move on.
Regardless of what you paid for your home, its fair market value has undoubtedly declined. Forget about the original price and contact a real estate agent who can show you "neighborhood comps" - records of what other homes in your neighborhood have sold for. Be prepared to knock your asking price down at least 10% to give your home a competitive edge over your fellow seller. If this puts you below what you owe, the reality is this: new buyers will not pay more than the current market value just because you need to get a certain price. This means you may have to approach your lender for a short sale application and see how low a price they might be willing to accept.
Given that you are selling due to a financial issue, you may not have the money or even the time for major remodeling. Focus on cleaning the place up, painting, and doing the little things that could detract form the home in the eyes of buyers. Get the commitment of every family member to keep the house neat during the selling process. Your Realtor® will help you make the choices you may need to make the home look its best on a limited budget.
Though your agent will market the home as part of his job, you should make sure your home is heavily marketed on the internet. Sites like Craigslist, FrontDoor.com, Yahoo, Zillow, Trulia, and Realtor.com offer free or low cost listing options, plus syndicate to other sites. Upwards of 80% of potential homebuyers pre-shop for home online, so your home needs to be there - and be there with lots of pictures that show your home in its best light. You may still be working on a fixing a few minor things, but clear pictures of clutter-free rooms can whet the appetites of potential home buyers searching for a home at your price point.
Hopefully, a buyer will appear with good credit and a fast timeline like your own. If the buyer is having trouble with the purchase, your agent can help you offer incentives, such as offering to help with closing costs. In some cases, the new buyer can assume your loan (with the lender's ok) or lease with option to buy.
Need to sell your home fast to prevent foreclosure? Yonas Woldu can help you make ths happen.
N & Y Team
Yonas Woldu Direct: (702) 236-8997
Fax: 702-898-9738
If you've read our blog the last few months, you know that we have always said that Obama's housing programs were fluid programs that would expand to help more homeowners. Lo and behold, on July 2, HUD Secretary Shaun Donovan announced that homeowners who are 125% underwater on their mortgages would now qualify for Making Home Affordable refinancing programs. Prior to the announcement, mailings about the program have been sent to over 1 million borrowers who might qualify for refinancing; to date 200,000 trial loan modifications have been offered. Yet, housing values have tanked so low that many homeowners have been unable to get help under the program - especially in very hard hit areas like Nevada.
Exercising a flair for the dramatic, Donavan made the announcement between two homes on Pine Valley Drive in Las Vegas that showed great contrast. Claiming that Nevada is "ground zero" for foreclosure activity, he was flanked on one side by a well kept home with a beautiful lawn and on the other, by a vacant home with a dried out lawn and foreclosure sign. Donovan underscored the reality of foreclosures. Despite how personally devastating they can be to people who undergo them, they also affect neighborhoods and whole cities especially when several homes on a street or neighborhood are foreclosed on, which can give a blighted look to the area. You could go on to say that widespread foreclosures bring an ever-growing black cloud over the neighborhood that influences opinions about the place as property values are dropping. The premise of expanding the program is that more access to refinancing options will reverse the trend.
The increase in the plan limit, formerly 105%, is expected to help some of the 67% of Nevada homeowners whose mortgage balance exceeds their home's value. This means someone with a $375,000 mortgage would be eligible of the program is the home is still worth $300,000.
In Las Vegas, of course, the questions are: how many people are 125% underwater or less? Since being current is a requirement for the government refinancing program, how many people are have not been over 30 days late on their underwater mortgages? How many underwater homeowners have their loans not covered by Fannie Mae or Freddie Mac, the only loans eligible for refinancing under making Home Affordable?
The HUD Secretary did not offer answers to these questions but went on to promise that his department was searching for the facts. HUD Foreclosure Rapid Response Teams would be deployed within two weeks to assess needs in the Las Vegas zip codes based on delinquency rates. The group would listen to neighborhood groups who are familiar with the local housing scene, including lenders, housing counseling agencies, and citizens, and develop specialized recommendations, which another HUD team would implement. Since HUD has received an increasing number of housing discrimination complaints as the housing crisis has escalated, Fair Housing counselors would join the Las Vegas office to educate the public, receive and investigate complaints, and monitor Section 8 vouchers and public housing units.
Even though the government has not yet released a swooping program that will benefit all underwater homeowners, the new program is coming closer - especially when viewed in conjunction with the HUD Foreclosure Rapid Response Team initiative.
http://www.makinghomeaffordable.com/pr_07012009.html
Need help to prevent foreclosure? For more information on the Home Affordable Refinance Program, visit makinghomeaffordable.gov or call 1-888-995-HOPE. The N&Y Team can help you find the right direction.
N & Y Team
Nebi Adhanom Direct: (702) 277-9922
Yonas Woldu Direct: (702) 236-8997
Fax: 702-898-9738
Click here to get a market snapshot of your home value!
When we read the current blog by Brian Tutas on whether walking away from an underwater home was morally wrong or good financial sense, we couldn't help but reflect on the same research on this topic that he referenced. Researchers from Northwestern and the University of Chicago studied housing in Massachusetts and came to the unsurprising result that the more a homeowner is drowning in an upside down mortgage, the more likely he is to default.
It seems that 15% is the magic number. When the housing value is 15% less than the amount of the mortgage, people start walking. Even if they can afford to pay the mortgage, 17% would leave if the difference was 50%. People under 35 and over 65 don't see this as moral issue. The researchers found different attitudes about this based on race, educational level, and region. They concluded that as more people defaulted, the morality issue would diminish.
In Las Vegas, this is a big issue as 1 in 64 homes is underwater. For a realtor®, the question becomes: what role do we take in influencing in underwater homeowners to leave their homes?
We work with many people a sneeze away from foreclosure. We carefully counsel them about the choices they have available to them to avoid foreclosure. We make sure they know that foreclosure alternatives will have credit consequences but may relieve their stress and allow them to move on to the next stage of their lives feeling more in control of the situation. If the subject of walking away comes up, we discuss the consequences, but don't direct the choice they make.
Like all realtors®, we have a dilemma. Selling homes is linked with the ability to have the purchase financed. Lenders expect borrowers to enter into mortgage agreements in good faith. It is true that there was a lack of good faith in many quarters over the last years, but "good faith" - where the lender lends and the borrower promises to pay back the loan - is a necessary component of the system.
Desperate times might call for desperate measures. Whether some people were greedy or a victim of circumstances is immaterial. Personally, we see the need for a solution that will dry up the underwater mortgage issue and feel minimal sympathy for the banks. The question remains, is it our job as realtors® to encourage walking away even if the numbers add up to that solution?
Need help to prevent foreclosure? For more information on the Home Affordable Refinance Program, visit makinghomeaffordable.gov or call 1-888-995-HOPE. The N&Y Team can help you find the right direction.
N & Y Team
Nebi Adhanom Direct: (702) 277-9922
Yonas Woldu Direct: (702) 236-8997
Fax: 702-898-9738
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We keep your real estate purchase simple and fast! Our philosophy: Buy what you can afford now. Our goal is to serve you in Greater Las Vegas whether you seek a suburban home or downtown condo.
My name is Yonas Woldu. For the past 6 years,my colleagues and I at Prudential Americana Group, REALTORS® have served the Clark County, Nevada area - specifically, Green Valley, Henderson, and Las Vegas. Though like the rest of the country (and in particular, the State of Nevada) we have been hard hit by foreclosures and falling home values, Las Vegas and surrounding communities have vibrant economies that makes them great places to live and work. I have a passion for helping potential homeowners find a home in the area that is right for them now - at this point in their lives, for the circumstances they are in.
Though I am relatively young, I grew up in the real estate industry, often observing my mother (and current partner in the N&Y Team), Nebiat Adhanom. As a college student at the University of Nevada (UNLV), I obtained my real estate license and sold 7 homes my first year - above average for new agents. Once I realized that real estate was a career where I could use my finance background and help families, I knew I had found my niche.
Once out of college, I started in real estate in the boom times of 2004. I immediately noticed my mother was overwhelmed with sales that stalled at closing as lenders were overwhelmed as well. This caused me to assume a different role for several years - that of a lender. I wanted to make sure our clients received the best rates and the best loan product in a timely manner. While working in the loan industry, I was able to help over 200 clients over a span of 3 years.
Now serving once again as a full time realtor, my goal is to continue the growth of our real estate operation and work with as many buyers and sellers as possible and provide everyone the best service imaginable in regards to all real estate matters.
Our N&Y Team serves the Greater Las Vegas area, an area where I grew up and know well. When people think of Las Vegas, they think of only glitzy night life, but Henderson, Green Valley, and many nearby communities are great places to live and work, set in beautiful, park-like settings.
With my background in real estate and real estate lending, plus a thorough understanding of finance, I know how to prepare people to buy a home - whether it's a luxury condo near the Vegas strip or a home in Henderson, Nevada's third largest city. I feel strongly that the key to a stable economy is having a stable real estate industry; the key to a stable industry is having first time buyers or buyers with low debt and a strong employment history. As I saw first hand, permitting buyers to overextend themselves or encouraging them to agree to a loan not in their best interest will help neither them nor the local economy in the long run.
In this new world of real estate, advising sellers of the best way to position their home for a timely sale at a fair price is crucial. We work with sellers to find appropriate buyers who are preapproved and ready to buy.
As an unfortunate sign of the times, there are many properties in Clark County offered as foreclosures or short sales. Many of the available homes offer excellent values for qualified homebuyers, but often the process to obtain these properties is lengthy. I work diligently to make sure that these transactions are processed as quickly as possible so that both buyer and sellers can move on to the next stage in their lives.
"Yonas Woldu with the N & Y Team has been handling all my Real Estate and Loan needs for the past five years. I will keep using Yonas for my future needs. He provides outstanding creative loans and makes my closings quick and easy. I will continue recommending him to my friends and family."
- Edna Bartlett
"Nebi Adhanom and the N & Y Team with Prudential Americana were very productive! I had two homes listed in Southern Highlands and Nebi listed and SOLD both than a month-and-a-half! They were efficient in every step of the process and made sure the transactions went as smooth as possible. I highly recommend her and her team for anyone who is looking to buy and sell property".
- Matt Knox
SEE OUR WEBSITE AT WWW.VEGASREALPROPERTY.COM FOR MORE STRONG CLIENT RECOMMENDATIONS
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