YourHomeUtah.com

Here are the facts concerning Utah's $6,000 New Housing Grant

• To be used for the purchase of new construction or never occupied properties.
• $6,000 Grant - No Repay Required
• Only for Owner Occupied Transactions
• No First-Time Homebuyer Requirement
• $6,000 can be applied towards down payment, closing costs, rate buydown or principle reduction.
• May use any Mortgage Lender.
• Loan Types: Conventional, FHA, VA, Rural and Utah Housing - 30yr fixed terms only.
• To request grant, loan must be approved by underwriter.
• State fund: $10,000,000 (approx 1800 borrowers).
• Subject to Utah Housing Income Limits and Max Loan Limits (per county).
• Applicant can not make more than $75,000 single, $150,000 married.

Congress Has Approved An $8,000 Tax Credit for Homebuyers!

The credit is available to first-time home buyers and/or people who have not owned a home for three or more years. The credit applies to purchases made between 1/1/09 and 12/01/09.

Q: How much is the tax credit?
A: $8,000 or 10% of the purchase price, whichever is less.

Q: What type of purchase is eligible?
A: The purchase of a principal residence by first-time homebuyers.

Q: Who qualifies for the first-time homebuyer credit?
A: According to the IRS, any taxpayer who has not owned a home during the three years prior to the date of purchase can qualify for the credit.

Q: Do I have to repay the credit?
A: NO, as long as you live in the home three or more years.

Q: Are there income limitations on the tax credit?
A: The credit phases out for individuals with ADJUSTED gross income over $75,000 or married couples over $150,000.

For more information please call (801) 824-5070

Rates are below 5%, home prices have dropped and there are many wonderful homes to choose from. Don't wait until everyone else has decided the market has bottomed, ACT NOW!

If you have a credit score of 620 or higher, you have 3.5% to put down or are a Veteran, you're good to go. We can find you a home now where the seller will pay your closing costs!

Did you know that a family member can pay your 3.5% down on a FHA loan! Did you know that you may qualify for a $8,000 tax deduction too!

Call us today for the datails: (801) 824-5070

When you're out on the net shopping for a loan you're sure to run into LendingTree and a host of other Mortgage Lead Generators. They claim "When Banks Compete, You Win". What they don't tell you is that they are simply a lead generator for companies who pay them for your information.

When you apply for a loan, anywhere, the rate you're quoted is simply a best guess. No one can tell you exactly what your rate and loan costs will be until your credit is run, income is verified and your purchase contract has been reviewed. Then comes the appraisal and underwriting where things can change drastically.

Within our Real Estate practice our clients who use LendingTree or other lead generators have experienced higher interest rates, higher closing costs and more loan denials regardless of what they are told up front when "Banks Compete" for your business.

The best advice we can give you regarding your next mortgage is to stay local. Work with a local Mortgage Broker, Bank or Credit Union. You want to be able to sit in front of the person responsible for your loan when things don't go as planned.

Reprint from Salt Lake Board of REALTORS®

Single Family Homes and Condominiums Sold in Salt Lake County

First Nine Months 2008
Sold 8,706 homes/condos (down 26 percent compared to 11,795 sales in the first nine months 2007) Median Price: $229,900 (down 1.5 percent compared to median $233,450 in the first nine months 2007)

3rd Quarter 2008
Sold 3,108 homes/condos (down 11.5 percent compared to 3rd Quarter 2007) Median Price: $225,000 (down 4.3 percent compared to median price of $235,000 in 3rd Quarter 2007)

September 2008
Sold 1,031 homes/condos (up 13 percent compared to 913 sales in September 2007) This is the first month in 21 months (since January 2007) that we have seen a year-overyear increase in sales for a particular month. Median price in September was $220,000, down 2 percent compared to September 2007.

Sales Trends For First Nine Months 2008
72 percent of all home/condo sales in the first nine months of this year closed at under $300,000. Only 7 percent of all sales so far this year were for homes at $500,000 or greater.

Foreclosures
Utah's foreclosure rate was 1.23 percent in the 2rd Quarter, according to the Mortgage Bankers Association. Only eight states have a lower foreclosure rate than Utah. Nationally, the foreclosure rate is 2.75 percent. In Florida, the highest of all states, it is at 6 percent.

Conclusion
It appears sales of existing homes in Salt Lake County are on the rise, while we are continuing to see single-digit declines in home prices. We expect home prices to continue to stabilize into 2009. Buyers are now able to find terrific buys on properties and have a large inventory to choose from. Sellers must price their properties competitively. Peak median price in Salt Lake County occurred in June 2007: $243,000. September 2008 median: $220,000. The median price is down 9.5 percent off our peak month. We are back to where we were in mid-to-late 2006 in pricing and back to 2002 in terms of sales volume.

Reprint from Salt Lake Board of REALTORS®

WASATCH FRONT POPULATION SURGE TO OFFER TREMENDOUS ECONOMIC OPPORTUNITIES, ACCORDING TO THE SALT LAKE BOARD OF REALTORS®

13 November 2008 (Sandy) - Today's troubled economy will pass, largely due to a population explosion set to hit the United States and the Wasatch Front, according to Arthur C. Nelson, presidential professor of city and metropolitan planning at the University of Utah.

Nelson should know. He came to Utah after a 21-year career at Georgia Tech and Virginia Tech and is one the nation's most recognized urban planners. He has been cited as an expert source by Atlantic Magazine, The New York Times, National Geographic, Newsweek, ABC and CBS.

"We are facing tremendous demographic changes in this country and in the Wasatch Front," Nelson said. "The United States is a growing nation. We'll actually add 100 million more Americans to this country faster than any other country with the exception of Pakistan and India."

And here along the Wasatch Front Nelson projects more than 2 million more people will populate the area by 2040, raising the total population count to more than 4.2 million people.

The doubling of the Wasatch Front's population means more homes and more commercial space will be needed to satisfy what Nelson calls a "megapolitan" surge. In fact, Nelson projects more than 900,000 new housing units at a value of $300 billion will need to be built along the Wasatch Front by 2040, a 126 percent increase compared to the roughly 650,000 housing units at present.

The onslaught of more people coming to the Wasatch Front will also coincide with a surge in job growth, according to Nelson, who estimates that more than 1.3 million new jobs will be created in the area by 2040, pushing demand to build roughly 800 million square feet of new nonresidential space that will include offices, retail stores and industrial warehouses. In addition, Nelson said, 1 billion square feet of existing nonresidential space will need to be rebuilt.

The combination of new residential and non-residential space to be built presents tremendous economic opportunities for architects, builders, planners and REALTORS®. "Population and job growth are the key drivers to a strong housing market," said Jillinda Bowers, president of the Salt Lake Board of REALTORS®. "Utah's housing slowdown, while at the present time may seem severe, will in coming years appear as a small blip to the future growth and sales that will again come to this area."

Indeed, the coming population hit will change the very aspects of how and where Utahns live – with more people demanding downtown living and fewer households having children, according to Nelson.

Currently, 37 percent of all Wasatch Front households have children. However, by 2040 that percentage will drop to 29 percent.

"One of the reasons we have childless households growing at a fairly rapid pace is because we are aging," Nelson said. "Many of us have already raised our children and we will be living a long time. The number of people turning 65 years old won't peak until the year 2022."

And, Nelson points out, because people are living longer, only 25 percent of our adult life is now spent raising children.

With rising numbers of Wasatch Front households having no children, demand for downtown living and what Nelson calls "near-center" living will increase. Nelson predicts that 60 percent of all future housing units must be tailored to meet the demand of those wanting downtown or near-center living.

About 10,000 people or roughly 0.5 percent of the Wasatch Front's population currently live in downtown Salt Lake City. Conservatively speaking, that number will grow to 40,000 people by 2040 or 1 percent of the Wasatch Front's population.

"I actually suspect that downtown Salt Lake City could attract up to 100,000 people by 2040, making it one of North America's downtown/near downtown residential gems," Nelson said. "Think Vancouver, British Columbia; San Diego, what Denver is becoming, Portland and Seattle."

Reprint from Salt Lake Board of REALTORS®

OCTOBER HOME SALES SLIDE, MEDIAN PRICE HOLDS STEADY, ACCORDING TO THE SALT LAKE BOARD OF REALTORS®

24 November 2008 (Sandy) - Existing home and condominium sales fell to 822 units in October, down 19.4 percent compared to 1,020 units sold in October 2007, according to a report today by the Salt Lake Board of REALTORS®. October's sales were down 20.7 percent compared to 1,036 sales in the previous month of September.

The median sales price in October was $228,450, down 0.7 percent compared to a median sales price of $230,000 in October 2007, but up 3.7 percent compared to a median sales price of $220,375 in September.

The median days on market to sell a home increased to 77 days in October, up from 48 days in October 2007 and up from 71 days compared to September.

With all the press of late you'd think it would be next to impossible to purchase a home! While it's true that the days of drive up financing are long gone, it's still quite easy to get a home financed assuming you meet the requirements for an FHA loan.

Here are the basic requirements:

1) You will need cash for a down payment. The minimum amount is 3.5%. So let's say you want to buy a home priced at $200,000. You'll need $7,000 down. This money can come from a relative but you can't simply take a cash advance on your credit card because that would show up on your credit report.

2) Closing costs can be paid for by the seller on your behalf, up to 6% of the price of the home. This is huge! It means that the only money you'll need is the 3.5% down payment!

3) All your monthly debt payments (mortgage, car payment, credit cards, student loans, etc) added up can not be more the 41% of your combined gross monthly income. For example, if you and your spouse make $5,000 per month combined gross income and your only debt payments are $500 for the car and $250 for credit cards you'd have $1,300 left over for your home payment each month.

4) Your credit score must be above 620. Don't rely on those online credit reports, the scores are not the same as your loan officer will see.

5) The price of the home you're purchasing must be below the FHA maximums for your county.

So as you can see, the hurdle is set pretty low at 3.5% for a down payment. Once upon a time you needed 20% to buy a home. So things aren't as bad as they may seem.

If you'd like to discuss your home purchase needs or FHA loans just give us a call.

Take care,
Doug and Dorene Greene.

When a home owner can no longer afford to keep mortgage payments current, there are alternatives to bankruptcy and/or foreclosure proceedings.  One of these options is called a "short sale".

When a mortgage lender agrees to allow a short sale on a property it means that the lender is accepting less than the total amount due on the home.  Not all lenders will accept short sales or discounted payoffs, especially if it would make more sense financially to foreclose.  Additionally, not all sellers nor all properties qualify for a short sale.

When viewing homes on YourHomeUtah.com it is technically impossible for us to designate which homes are short sales.  You will need to  contact us to verify the status of the home for sale.  As a basic guideline, if the home price seems to good to be true, it is most likely a short sale.

Many sellers will list a home as a short sale prior to getting approval from the mortgage lender.  As a matter of fact, most homes that are listed as short sales have yet to be approved by the mortgage lender as a short sale.

Purchasing a short sale can be a frustrating process.  Your Real Estate Agent will work in your best interest to get you the home or at least get a response from the mortgage lender in a timely manner however, it can take months to get a reply.

Many times short sales are listed at a price that would represent a bargain under normal circumstances.  This pricing spurs interest from investors and home buyers looking for a great deal.  In most cases the listing price has NOT been approved by the lender.  Most mortgage lenders who agree to a short sale will collect offers for a period of time before making a decision.  For these reasons, many short sales are ultimately sold for more than the listed price.  Additionally, lenders are looking for offers that contain no concessions and have a large cash down payment.

While it is not impossible to get a great deal on a great home by purchasing a short sale, here are some things to think about:

1) Sellers Paid Too Much.

If a home sold for $500,000 a few years ago and is now for sale at $400,000, that doesn't mean the buyer is picking up $100,000 of equity for free. It means the seller paid too much in a rising market and now the market has fallen. It means the seller has no equity.

2) Sellers Borrowed Too Much.

Banks that were eager to lend money in appreciating markets sometimes allowed borrowers to over-mortgage the home, meaning the borrower's loan balance exceeded the value of the property. Appraisals are subjective, and not all appraisers will place the same value on a home. Although against the law, some appraisers are pressured by banks to appraise at the amount the home owner wants to borrow.

3) Stringent Qualifications.

Inexperienced or unethical real estate agents might push a seller into considering a short sale when the seller does not qualify for a short sale. Sellers must prove a hardship and submit evidence of the hardship to the lender for approval. Some agents list homes as short sales without ever talking to the lenders or pre-qualifying the sellers.

4) Homes Sell at Market Value.

Lenders aren't naive or unaware of the value of a home. Lenders will insist on a comparative market analysis, known as a CMA, or broker price opinion, known as a BPO. If a lender believes a better price can be obtained by taking the property back in foreclosure over a short-sale offer, the lender may hold out for a higher price. That price will be close to market value. Lenders accept short sales when the home is worth the short-sale price, which means market value.

5) Homes Sell "As Is".

If a mortgage company agrees to a short sale, it is most likely also paying the closing costs in the transaction. Lenders ask buyers to purchase the home in its present condition. Lenders typically will refuse to pay for:

    * Suggested repairs disclosed on a home inspection.

    * Pest inspections or work necessary to issue a clear pest report.

    * Roof certifications or roof repairs.

    * Home protection plans for the buyer.

    * Deferred maintenance.

6) Length of Time to Close.

Depending on when the Notice of Default was filed, the lender's back-log of foreclosures and how much paperwork the seller has already submitted, it could take anywhere from two weeks to three months to get a response on a purchase offer from a lender. In addition, if two lenders are involved because there are two loans secured to the property, it could take longer to satisfy the demands of the second lender.

7) Lenders Can Change Conditions.

Some lenders reserve the right to renegotiate the terms of the short sale at the last minute. If the market changes, new laws pass or new information crosses the lender's desk, the lender can attempt to change the terms of the contract. Lenders generally have lawyers at their disposal, and ordinary buyers do not.

8) Lenders Discount Commission.

I don't know of any lenders who are paying traditional real estate commissions to real estate agents. They will want a discount. Moreover, agents end up doing two to three times the work of a conventional transaction and don't appreciate getting paid less to do more work. If you have agreed to pay your agent a certain percentage under a buyer broker agreement, you could be liable for the difference between what the lender will pay and what your contract stipulates, if your agent refuses to waive the difference. (Dorene and I will waive the difference, we will only accept commissions paid by the lendor.)

9) Higher Buyer Closing Costs.

Because lenders rarely will pay for any extras, like a seller would be willing to do, if you want any of those extras, you will pay for them yourself. Sometimes lenders will refuse to pay for standard seller closing costs such as transfer taxes, too. If you want specific inspections, you will probably pay for them out-of-pocket.

10) Lose Control of Transaction.

If you need to close escrow by a specific date, lots of luck with that. A short sale home closing process takes an indefinite amount of time. The seller's lender calls the shots, not the buyer nor the buyer's lender. If you are trying to close escrow concurrently with the sale of your home, it might not happen.

11) Little Seller Motivation.

When the seller discovers that the short sale effect on credit is identical to that of a foreclosure, there is little incentive for a seller to cooperate with a short sale. There is no benefit to a seller to consider a short sale and move out before the foreclosure is concluded, except for peace of mind that the nightmare is over.


When does it make sense to pursue a short sale?

1) The home you're interested in has been approved by the seller's mortgage lender for short sale - or - you understand that the lender may require a higher purchase price to accept the short sale.

2) You have been pre-approved by your lender for the offering price.

3) You have NO contingencies such as a home to sell.

4) You have cash for down payment and closing costs.

5) You're not in a hurry, you have up to two months to wait for an answer.


If you have additional questions please call Doug (801) 913-5869 or Dorene (801) 824-5070, we're always happy to assist you.