Columbus Real Estate News

If you want to buy a house, now is the time, and if you don’t act soon, you will regret it. Here’s why: historically low interest rates.

As of today, the average 30-year fixed-rate loan with no points or fees is around 5%. That, as the graph above—which you can find on Mortgage-X.com—shows, is the lowest the rate has been in nearly 40 years.

In fact, rates are so well below historic averages that it should make all current and prospective homeowners take notice of this once-in-a-lifetime opportunity.

In 1970 rates were approximately 7.25%. After hovering there for a couple of years, they began a trend upward, landing near 10% in late 1973. They settled at 8.5% to 9% from 1974 to the end of 1976. After the rise to 10%, that probably seemed O.K. to most home buyers.

But they weren’t happy soon thereafter. From 1977 to 1981, a period of only 60 months, the 30-year fixed rate climbed to 18%!

Interest Rate Lessons

And when rates started to decline after that, they took a long time to recede to previous levels. They hit 9% for a brief time in 1986 and bounced around 10% to 11% until 1990. For the next 11 years through 2001, the rates slowly ebbed and flowed downward, ranging from 7% to 9%. We’ve since spent the last nine years, until very recently, at 6% to 7%. So you can see why 5% is so remarkable.

So, what can we learn from the historical trends and numbers?

First, rates have far further to move upward than downward; for more than 30 years, 7% was the low and 18% the high. The norm was 9% in the 1970s, 10% in the mid-1980s through the early 1990s, 7% to 8% for much of the 1990s, and 6% only over the last handful of years.

Second, the last time the long-term trends reversed from low to high, it took more than 20 years (1970 to 1992) for the rate to get back to where it was, and 30 years to actually start trending below the 1970 low.

Finally, the most important lesson is to understand the actual financial impact the rate has on the cost of purchasing and paying off a home.

Every quarter-point change in interest rates is equivalent to approximately $6,000 for every $100,000 borrowed over the course of a 30-year fixed. While different in each region, for the sake of simplicity, let’s assume that the average person is putting $40,000 down and borrowing $200,000 to pay the price of a typical home nationwide. Thus, over the course of the life of the loan, each quarter-point move up in interest rates will cost that buyer $12,000.

Loan Costs

Stay with me now. We are at 5%. As you can see by the graph above, as the economy stabilizes, it is reasonable for us to see 30-year fixed rates climb to 6% within the foreseeable future and probably to a range of 7% to 8% when the economy is humming again. If every quarter of a point is worth $12,000 per $200,000 borrowed, then each point is worth almost $50,000.

Let’s put that into perspective. You have a good stable job (yes, unemployment is at 10%, but another way of looking at that figure is that most of us have good stable jobs). You would like to own a $240,000 home. However, even though home prices have steadied, you may be thinking you can get another $5,000 or $10,000 discount if you wait (never mind the $8,500 or $6,500 tax credit due to run out next spring). Or you may be waiting for the news to tell you the economy is “more stable” and it’s safe to get back in the pool. In exchange for what you may think is prudence, you will risk paying $50,000 more per point in interest rate changes between now and the time you decide you are ready to buy. And you are ignoring the fact that according to the Case-Shiller index, home prices in most regions have been trending back up for the last several months.

If you are someone who is looking to buy or upgrade in the $350,000-to-$800,000 home price range, and many people out there are, then you’re borrowing $300,000 to $600,000. At 7%, the $300,000 loan will cost just under $150,000 more over the lifetime, and the $600,000 loan an additional $300,000, if rates move up just 2% before you pull the trigger.

What I’m trying to impress upon everyone is that if you are planning on being a homeowner now and/or in the foreseeable future, or if you are looking to move your family into a bigger home, then pay more attention to the interest rates than the price of the home. If you have a steady job, good credit, and the down payment, then you really are being offered the gift of a lifetime.

If you, or someone you know is considering Buying or Selling a Home in Columbus, Ohio please contact The Opland Group. We offer professional real estate advice and look forward to helping you achieve your real estate goals!

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;  Bexley  Columbus  Delaware  Downtown  Dublin  Gahanna  Grandview Heights  Granville  Grove City  Groveport  Hilliard  Lewis Center  New Albany  Pickerington  Polaris  Powell   Upper Arlington  Westerville  Worthington

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If you owned a house that was now worth significantly less than what you owe on your mortgage, ie you were “underwater”, would you walk away from the home and default on the mortgage? If so, you’d have plenty of company according to a recent national survey by Reecon Advisors.  Their study indicates that nearly one out of 10 homeowners, or 9.2%, would likely choose to default if they found themselves in this situation. And today, we’re seeing more and more evidence that some people are beginning to do just that. They’re choosing to “strategically default” on their mortgages.

A “strategic default,” is the act of walking away from an underwater mortgage not out of necessity, but because it is in the homeowners best financial interest.

First American CoreLogic, a real-estate information company, recently did a study that suggests when a home falls below 75% of the amount owed on the mortgage, the homeowner begins to think about walking away, even if he or she can pay the mortgage.

What’s Driving This Trend

What’s driving this phenomenon, what are the consequences of choosing this route, and what about the moral issue of leaving that debt for the banks to deal with?

Driving this phenomenon is the rising number of households that are deeply underwater, owing much more than the current value of their home. First American estimates that 4.5 million U.S. households have crossed that critical threshold where there home’s value has fallen below 75% of the amount owned on the mortgage, and that an astounding 2.2 million of these households are at least 50% underwater.

This problem is largely concentrated in negative-equity markets that most severely experienced the bubble. These markets witnessed dramatic increases in housing prices during the boom based largely on artificial demand created by speculators and investors, however, prices have since plummet by as much as 20-50%. These markets include states such as; Arizona, California, Florida and Nevada. In California last year, the number of strategic defaults was 68 times higher than it was in 2005, Florida, 46 times higher. In most other parts of the country the number of strategic defaults were about 9 times higher than in 2005.

View Interactive Map - Strategic Defaults by State

Moral Issues - Just a Business Decision

Most homeowners, or homeowners as a group, don’t walk away… that is they don’t strategically default. Yet the fact is millions of Americans who are underwater, would in fact be financially better off if they did walk away, just like Morgan Stanley recently walked away from five properties in San Francisco, five buildings which were underwater. Morgan Stanley just gave the properties back to the bank. Homeowners typically from doing so because of anticipatory shame and guilt, and because of an exaggerative fear about the consequences of waking away from a mortgage.

These emotions of fear and shame and guilt are cultivated by the government, by the financial industry and, to some extent, the media. And they do this by cultivating a double standard, a standard in which Americans, average Americans, are told to have a moral obligation to pay their mortgage and to meet their financial obligations, whereas corporations freely and frequently default when it’s in their financial best interest to do so.

And, in fact, these groups would be obligated to protect the interest of their shareholders and walk away from an underwater mortgage if it was a financially wise decision. The ongoing argument is that this norm asymmetry, the difference in norms between average Americans and banks, leads to distributional inequalities whereby average Americans are bearing a disproportionate burden from the housing collapse.

If you divorce the decision from guilt and shame and make it purely a financial one you would consider the current rates of appreciation in your local market, the anticipate future rates of appreciation and would then consider how long it will take to break even on your investment and return to profitability. You would also consider the cost of renting for 2-3 years while your work on rebuilding your credit, or the tremendous opportunities that exist for buyers in the current housing market if you are somehow able to immediately purchase another home.

What homeowners need to understand is that a contract is not a moral document, it’s a legal document. And the law does not provide for punitive damages for breach of a contract because it’s not considered to be a moral wrong.

In fact, the law encourages the efficient breach of contract… meaning people should default on a contract when it is in their economic interest to do so. And because sophisticated parties understand this, they generally decide in advance for the consequences for a default on a contract or breach of a contract. In the case of a mortgage contract, the bank is the sophisticated party, and the bank puts in the penalty. That penalty is if you default, then the bank gets the house back and that’s actually the agreement. And so, a homeowner who lets go of their house and gives it back to the bank is honoring the contract and is, in fact, doing nothing immoral. The contract provides the option for default and in fact, in a non-recourse state, the bank cannot come after an individual for deficiency judgment and their only recourse is to take back the property. For those states that are recourse states, the right to pursue homeowners for a deficiency judgment can in fact be waived as part of the short sale negotiations.

The banks consider this risk of default every time a mortgage application is taken, and they factor this risk into your loan and the rate they charge you for that loan.  As such, we tell people you have a contract, the contract gives you a right to walk away and you paid for that right to walk away by paying more money at closing.

Consequences of Walking Away

Walking away isn’t risk-free and while we wouldn’t advise anyone to strategically default, it is an option you may want to consider if you’re stuck in a home with a huge loss that you don’t expect to ever recover. That said, homeowners should not simply walk away and rather should first speak with a local Realtor who specializes in short sales and determine if this is an option they might qualify for. Do not just speak to any real estate agent as while many agents are not claiming the title of “Short Sale Specialist” and “Certified Distressed Property Expert”, most of these agents have only completed course work on this topic and have never actually successfully completed a short sale transaction. Rather, seek out a specialist, that is a Realtor with significant experience who has successfully completed a number of these transactions and can provide evidence of this.

Credit score implications

• Most mortgage lenders won’t lend to people who have had a foreclosure within the last 5 years; so if you do a “strategic default” plan on renting for 5 years. If you convince the bank to do a short sale, this is reduced to 2 years.

• While you may be able to get a mortgage in 4 years, the foreclosure stays on your credit report for 7 years. Short sales are reported as foreclosures, and rather are reported as settled or paid. Interestingly, it’s not the foreclosure or short sale that does the most damage to your credit report — it’s all the late payments you rack up as you move toward foreclosure or a short sale.

• Fortunately, those late payments will be off your credit report in 2 years.

Legal implications

• Depending on whether a loan is a ‘recourse’ or ‘non-recourse’ the implications will vary. Non-recourse loans are exactly that, in the event of default the bank can take the collateral for the loan (the home) but has no other recourse against the borrower if there is a deficiency. With recourse loans the homeowner may be held personally liable to the extent that the outstanding debt exceeds the proceeds realized from the sale of the collateral. The outstanding debt will be adjusted to include any additional interest, fees and penalties incurred in the time leading up to the foreclosure sale. It is entirely up to the lender to decide if, and who they pursue for deficiencies, however, if the borrower has little assets to speak of the bank is not likely to waste their time and money throwing good money after bad. Retirement assets are exempt so long as they are in the appropriate fund or account. That said, borrower can not make contributions to those retirement accounts for the intended purpose of predefault maneuvering *** If you convince the bank to do a short sale part of the negotiations will include insisting that they agree to accept the sales proceeds as payment in full and not to pursue you for a deficiency. ***

• If you have a Home Equity Line of Credit (HELOC) or other non-purchase money mortgage — this is recourse debt and the bank can come after your wages or other assets if you default on the loan.

• If you default on a recourse loan, the bank will: 1) foreclose on the property; 2) determine if it is in the banks interest to sue the borrower in court for a deficiency and if so do so.

• If you decide to do a strategic default, you’ll have approximately 12 months from when you stop paying until the home is foreclosed. But the only time guarantee is that the bank is required to notify you 91 days in advance of the trustee sale (the date the home will actually be foreclosed).

Tax implications

• There is a “forgiveness of debt tax” but it doesn’t apply as long as you’ve lived in your home for at least 2 of the last 5 years and the mortgage was used entirely as “purchase money” — to buy the house. The Mortgage Debt Relief Act also offers protection.

• There is an additional form you’ll have to submit to the IRS.  Talk to your accountant.

Other options

• If you make the decision to do a “strategic default” you should be sure that you’re comfortable with foreclosure as a possible end result.  That said, there are some other options you could pursue with the lender.

• One alternative to foreclosure is a short sale.  You sell your home as you normally would, but the bank has to agree to the purchase price — which will be some amount less than what you owe on the home. The bank takes a loss on the difference between what you owe and the proceeds of the sale.

• A short sale will still be a negative mark on your credit, but not as negative as a foreclosure.

• In some cases, you could negotiate with the bank not to report the late payments (those payments you miss between the time you default on the loan and when the short sale goes through) to the credit bureaus.

• Another option is to negotiate down your mortgage principle.  If you’ve decided already that you’re willing to accept a foreclosure, if that’s the end result, you could call the bank and ask them to reduce the principle you owe on your mortgage to the market value (or close to).  If you no longer have negative equity (or as much negative equity), that should eliminate the reason you decided to do a “strategic default” in the first place.

I have to say that I am not an attorney and none of the information I’ve presented here should be construed as legal advice.  If you have questions about foreclosure or “strategic defaults” or are thinking about defaulting on your mortgage, consult with a legal professional.

Other factors to consider

As mentioned, the period for eligibility of a future loan differ greatly between a homeowner who loses a home to foreclosure and a homeowner who successfully negotiates and closes a short sale.

Effective May 21, 2008 the homeowner of a primary residence who loses a home to foreclosure is ineligible for a Fannie Mae backed mortgage for a period of 5 years.  With a successfully negotiated and closed short sale a homeowner will be eligible for a Fannie Mae backed mortgage after only 2 years.  In a non-primary residence an investor who allows a property to go to foreclosure is ineligible for a Fannie Mae backed investment mortgage for a period of 7 years.  In a successfully negotiated and closed short sale an investor will be eligible for a Fannie Mae backed investment after only 2 years.

Eligibility for a future loan with any mortgage company for a homeowner who loses a home to foreclosure will affect their future rates and will require the prospective borrower to answer YES to question C in Section VII of the stand 1003 application that asks “Have you had property foreclosed upon or given title or deed in lie thereof in the last 7 years?” There is no similar question or declaration regarding a short sale.

 If you are a homeowner who feels they might qualify as a short sale candidate and are looking for an agent who specializes in these types of sales, or just need guidance, please give us a call at 614.332.6984 as we’d be happy to assist you in exploring this option and locating a buyer for your home!

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;  Bexley  Columbus  Delaware  Downtown  Dublin  Gahanna  Grandview Heights  Granville  Grove City  Groveport  Hilliard  Lewis Center  New Albany  Pickerington  Polaris  Powell   Upper Arlington  Westerville  Worthington

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Homeowners in distress are often the focus of “easy out credit scammers.” These entities call themselves foreclosure rescue companies, foreclosure assistance firms, or something similar. The scammer offers empty promises to the distressed homeowner in an attempt to make a quick profit from the distressed homeowner’s misfortune. With these companies, in the end the homeowner loses their home, as well as the money they paid the scammer in hopes of avoiding foreclosure.

Once the pre-foreclosure is under way, the court records the public notice of the action in the court or government records. Scammers can legally access these public records. They can also see foreclosure notices published in newspapers or online. With this knowledge, a scammer can then contact the homeowner, offering their services to prevent foreclosure. Other companies may use more traditional mass media to advertise their “resue” or “assistance” programs enticing the homeowner to contact them.

Red Flags

Watch out for companies that charge an upfront fee [excluding law firms which are legitimate foreclosure defense attorneys that can help the consumer defend a court action and help with other foreclosure defenses to save the consumer’s home.] stating they can help you save your home with a foreclosure modification or other options. They do nothing but take your money. Prosecutors warn that many of these are local companies which are run by former mortgage brokers and thus they may be knowledgeable, but many are in fact scammers who make empty promises they fail to live up to, while others are just plain crooks who take the money and never make any attempt to help the homeowner at all. Some have official looking websites that give consumers the impression that they are endorsed or approved by the government.

How to Recognize a Reputable Company

There are many legitimate modification companies, and mortgage brokers that can help consumers in there efforts to secure a mortgage modification however, homeowners should contact the Better Business Bureau, the Federal Trade Commission or HUD. Homeowners should also understand that only 1% of all mortgage modifications actually result in a principal reduction and if a company promises to get your principal reduced chances are they are not being honest with you!
 
For those looking to sell their home through a short sale, be aware that over 40% of total home sales which occurred in 2009 were short sales, a number which is expected to increase in 2010. In light of this many real estate agents see the opportunity this market segment represents and have rushed out to take one or more short sale educational courses. Upon completing these courses they immediately begin promoting themselves as short sale specialist. What these agents fail to realize is that these transactions are highly complex and require a very specific knowledge and skill set which can not be acquired simply through an educational course. 

Homeowners considering the short sale of their home should ask the agents they interview how many homes they’ve sold short and if they’ve previously worked with their lender as each lenders process varies slightly. Homeowners should also request the agent provide a list of the homes they’ve sold short and this should be double checked on a site such as Trulia which includes records of recent home sales including the name of the listing agent who sold the property. 

Examples of Scams

High cost, and phony credit counselors – the scammer offers to be an intermediary between the homeowner and the lender. The scammer recommends that the homeowner use the scammer as the sole point of contact, usually for an upfront fee. Once the fee is paid, the scammer disappears. In an extended version of this scam, the scammer informs the homeowner of the completed arrangements for reduced payments (forbearance). The scammer actually collects these payments, but never forwards the money to the lender. Of course, foreclosure eventually happens, and the scammer disappears. 

Signing over the deed – there are many variations to this scheme. The scammer may convince the homeowner to refinance the mortgage. In the pile of documents, the scammer will have a deed to the property. The unsuspecting homeowner might sign this, thereby giving the property to the “lender,” or scammer, instead of actually refinancing the loan. Another variant of this scam occurs when the scammer has the homeowner sign over the title with a promise to get the home sold quickly and at a good price. The scammer asks the homeowner to move out so the property can be sold, promising a split of any equity remaining after the sale. The scammer rents the home, keeps the money, and disappears when the foreclosure eventually occurs. The scammer may also simply sell the home and make off with all of the equity or profit. Other variants of this scam include the lease to buy back scheme. The homeowner needs to read every page when refinancing. Always consult with an attorney when any deed is involved.  
 
Lease to buy back options - Here, the scammer offers the homeowner an opportunity to remain in the home while working through their financial problems. The scammer takes the title to the property from the homeowner, promising to renegotiate the loan using their (the scammer’s) better credit rating. The homeowner signs a lease agreement that provides them an opportunity to buy the home back in the future. The scammer makes the terms of the lease and/or the buyback very restrictive, perhaps having regular rent increases or severe late payment penalties that eventually the former homeowner cannot meet. The scammer has the homeowner, now the tenant, evicted; and the homeowner loses the right to buy the home back. In another version of this scheme, the scammer actually takes out a mortgage to capture all or most of the equity. With the cash in hand, the scammer then defaults on the note, the lender forecloses on the property, and the evicted former homeowner retains no right to buy back the property.

Desperate Borrowers Seeking a Resolution

A homeowner facing foreclosure is under stress and could be susceptible to “too good to be true” promises of help. Caution is called for! While many scams are outright fraud and illegal, others are often technically legal. The homeowner must be alert for any unsolicited or advertised offers of help that involve high upfront fees, promises of “guaranteed” success, little or no effort on the homeowner’s part, unexplained paperwork or blank forms, signing over the Deed as a condition of assistance, cash purchase offers with a quick closing, and any lease agreements as part of the “help”.

If you are a homeowner who feels they might qualify as a short sale candidate and are looking for an agent who specializes in these types of sales, or just need guidance, please give us a call at 614.332.6984 as we’d be happy to assist you in exploring this option and locating a buyer for your home!

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;  Bexley  Columbus  Delaware  Downtown  Dublin  Gahanna  Grandview Heights  Granville  Grove City  Groveport  Hilliard  Lewis Center  New Albany  Pickerington  Polaris  Powell   Upper Arlington  Westerville  Worthington

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Should I do a Short Sale or a Loan Modification?

This very question is on the mind of millions of American’s as we speak. Short Sales and Loan Modifications are two terms that were previously unheard of for most, yet they are now everyday words. As credit tightens, housing slumps, and jobs disappear, more and more people will be forced to find alternative solutions to a mortgage that is not affordable. This article will serve as a means to provide information that may be useful in determining what the next step to financial improvement shall be.

Distressed home-owners should picture life without the burden of a mortgage debt that is all-consuming and overwhelming. Visualizing a life where there is no fear of answering the phone or checking the mail-box is a critical piece in preparing to regain control of their financial life. It will take perseverance and persistence to solve a deep and complex problem. The only way to get started is to be able to see the carrot at the end of the stick….financial relief!

Having said that, there are three solutions for home-owners who may be behind on their mortgage:

• Get the loan current and keep it current (Loan Modification)
• Short Sale
• Foreclosure

For the sake of this article, we are going to throw away the foreclosure option as it is never the best answer. That leaves us with Short Sales and Loan Modifications. A loan modification occurs when a lender agrees to change one or more parts of the loan terms in order to make the loan more affordable to the borrower (while still being able to repay the lender). The loan modification is best suited for borrowers who are behind on their mortgage but have a definitive plan for repaying their debts. Generally speaking, loan modification candidates have had a specific incident or occurrence that has caused them to be behind and is curable. The curability of the problem is significant. Without it, the lender will be unlikely to agree to new terms.

On the other hand. Short Sales are more appropriate for borrowers that have little hope of being able to afford their mortgage, and those who have no desire to keep their homes. For homeowners experiencing hardship, this may happen due to a long term job loss, extended illness, payment increase or mortgage adjustment, divorce, relocation, death of a partner (for a list of acceptable hardships please read Short Sales: Who Qualifies). A bank is more likely to agree to a short sale if the borrower can demonstrate a verifiable hardship. The lender also wants to see an effort for the property to be sold for the most amount of money possible. Lenders like to see the property listed with a reputable Realtor who is a specializes in short sales, these agents are highly trained best suited to assist you in your efforts as they know the short sale process inside and out and will do everything possible to cure the problem.

Make Sure Your Realtor Is A Short Sale Specialist

Short Sales made up over 40% of the gross volume of home sales last year and this number is expected to increase in 2010. In light of this fact many real estate agents have rushed out to take one or more short sale educational courses and upon completing these courses immediately begin promoting themselves as short sale specialist. What these agents fail to realize is that these transactions are highly complex and require a very specific knowledge and skill set which can not be acquired simply through an educational course. We at The Opland Group have been actively involved with short sales for over 3 years now, we’ve trained with former loss mitigators, that is the individuals who work for the banks and negotiate these sales, and in this time have assisted countless homeowners in avoiding foreclosure. Our rate of success is more than double the national average and this is what’s lead us to become the premier short sale specialty group.

Short Sale or Loan Modification

These are unprecedented times in our country’s economic history. Unfortunately, foreclosure and distressed is reaching into the lives of millions of American homeowners. If you or anyone you know is experiencing hardship we want to let you know we are here to help, are happy to assist you in discussing your options and determining which solution is best for you. All consultations are free and completely confidential. 

If you’re having trouble deciding whether your property qualifies for a short sale or you want to stay in your home and request a mortgage modification, you should consult your attorney or professional advisor first. This article will give you some information to help educate yourself on the different options so that you are knowledgeable no matter who you decide to consult with. Before you start down the path to a mortgage modification you should understand that the majority of these requests are denied and thus it’s a good idea to speak with a Realtor who specializes in short sales so you have a back up plan should your modifaction not be approved. The Today Show recently a segment on Mortgage Modifications suggesting just 5% of borrower requests were approved, MSNBC did a story on a couple and their Mortgage Modification experience which further discusses the topic. The take away from these stories is you need a back up plan, and the best back up would be to have the money to bring the loan current should your request be denied however, if this is not an option a short sale is the second best alternative.

Differences

Let’s briefly discuss the differences between a short sale and a mortgage modification. A short sale is when you owe more on your mortgage than your property is worth in today’s market. In a short sale situation, you decide to sell your home and the lender agrees to take less money than you owe on the loan. In a short sale transaction, normally you hire a Realtor to try and sell your home, negotiate with your lender and find your buyer. Of course, the lender must approve the offer and closing costs, which are usually presented on a HUD 1 closing statement.

A mortgage modification is similar to a refinance except that it is not a new loan. You are asking the lender to change the terms of your existing loan by modifying the interest rate, reducing your payments and/or extending the term of the loan. In a refinance, you are paying off the old loan with the new loan and you must have equity in your property. Mortgage modifications are not based upon your credit score like a refinance.

Most of the time to qualify for a mortgage modification you must be in default or behind in your payments and show a financial hardship such as loss of income, loss of job, death, divorce, etc. Mortgage modifications work best if you have a variable interest rate loan. Mortgage modifications can be negotiated by mortgage brokers and attorneys and some other types of businesses such as certified HUD home counselors. There are a lot of unscrupulous people trying to take advantage of distressed homeowners right now so check the credentials of the person who is helping you. If they ask for a large upfront payment (other than an attorney), they could be crooks so watch out. You can also try and negotiate with your lender on your own. Although I recommend hiring a professional to help you.

Similarities

Both short sales and mortgage modifications are ways to save your home from going to foreclosure. If the short sale, you are selling your home and walking away not owing the lender any money on the loan. In a mortgage modification, you are keeping your home and attempting to lower your interest rate and monthly payments so that you can afford them and keep your home.

Both take some time to get approved, and there is no guarantee that your lender will approve them. The processes are frustrating and can take anywhere from 30 to 90 days or longer.

The paperwork that the lender requests is also similar. In a short sale, the difference would be you have an offer to purchase your home and probably a listing with a Realtor which would need to be submitted and approved by the lender. Some of the other similar documentation that you will need to provide the lender in both a short sale and a mortgage modification are as follows:

1. Authorization letter if you are using a third party such as a Realtor, mortgage broker or attorney to negotiate for you. The letter should authorize your lender to release your loan balance information to the third party and/or their employees.
2. Hardship letter explaining the reason for your request.
3. Last two paycheck stubs verifying income.
4. Last two year’s tax returns.
5. Last two years 1099 or W2 forms.
6. Borrowers Financial Statement.

Both are options to consider if you are facing foreclosure. Other options may include a forbearance, deed in lieu of foreclosure, repayment plan and as a last resort a bankruptcy. If you are in default on your mortgage, your credit will have an impact but depending on which option you choose, it may be a lesser impact. Again, I recommend discussing these options with a qualified and reputable home counselor, Realtor, attorney or mortgage broker first before you make any decisions for your particular financial situation.

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;  Bexley  Columbus  Delaware  Downtown  Dublin  Gahanna  Grandview Heights  Granville  Grove City  Groveport  Hilliard  Lewis Center  New Albany  Pickerington  Polaris  Powell   Upper Arlington  Westerville  Worthington

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Renewable market optimistic as prices continue to stabilize

(Dec. 22, 2009) The month of November saw home sales soar 59.5 percent from this time last year with 1,839 listings purchased! Not since 2005 have November numbers been so high.

“Historically low interest rates and the tax credits for homebuyers put first time homebuyers in an ideal position to take advantage of the market,” said Gary Parsons, President of the Columbus Board of REALTORS®. “And with the expansion of the tax credit, we expect to see more renewable buyers enter the market in 2010.”

When the $8000 tax credit was renewed in October, it was expanded to include a $6500 tax credit for homeowners who wish to purchase a new residence. Those renewable buyers, or current homeowners who wish to purchase a new house, have been slow to return to the market but Parsons notes that as prices continue to stabilize, more renewable buyers will find new homes.

The stabilization of home prices was reflected in the average home price of $145,589, an increase of 1.5 percent compared to November 2008. 

To date, 2009 home sales are at 18,771, up 10.9 percent year-over-year. Homes spent an average of 92 days on the market, down 3.2 percent from this time last year and 1.1 percent lower than October’s average.

If you, or someone you know is considering Buying or Selling a Home in Columbus, Ohio please contact The Opland Group. We offer professional real estate advice and look forward to helping you achieve your real estate goals!

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;  Bexley  Columbus  Delaware  Downtown  Dublin  Gahanna  Grandview Heights  Granville  Grove City  Groveport  Hilliard  Lewis Center  New Albany  Pickerington  Polaris  Powell   Upper Arlington  Westerville  Worthington

A condominium building should embrace the community it is located in. The Short North is known for its vibrant lifestyle that is full of culture and a never-ending list of things to do. Taking this idea to heart, the developer assembled some of Columbus’ most creative minds to create a masterpiece that fuses historic architectural elements with modern design aspects that include a soaring tower of glass and steel. This coupled with interiors that are equally breathtaking and amenities that include a roof-top pool with sun terrace, and gourmet kitchens that are customizable, it is clear that JBH Holdings has delivered sheer perfection to the Short North. The results are nothing short of awe inspiring and dramatic.

Some of The Jackson’s amenities include; gourmet kitchens with cutting edge designs and the very latest in appliances, lavishly styled bathrooms, large walk-in closets, floor to ceiling windows, state of the art onsite fitness center, indoor scured parking, private balconies and terraces, a rooftop piazzas including an outdoor fireplace, and a pool overlooking the city!And if all this wasn’t enough the Jackson on High was also recently FHA approved and 100% Tax Abated! Meaning buyers can get all of this with a low down payment and reduced monthly payments as they will not be responsible for any property taxes for 10 years! On a $300,000 unit the tax savings on the abatement are equal to approximately $57,000 or $475 per month!

The Jackson on High Current Inventory List

If you, or someone you know is considering Buying or Selling a Home in Columbus, Ohio please contact The Opland Group. We offer professional real estate advice and look forward to helping you achieve your real estate goals!

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;  Bexley  Columbus  Delaware  Downtown  Dublin  Gahanna  Grandview Heights  Granville  Grove City  Groveport  Hilliard  Lewis Center  New Albany  Pickerington  Polaris  Powell   Upper Arlington  Westerville  Worthington

Deterioration in job markets is abating and economic activity has picked up but is likely to remain weak for a time, the Federal Reserve said in leaving its target for a key short-term interest rate at zero to 0.25 percent.

The housing sector “has shown some signs of improvement over recent months,” and household spending “appears to be expanding at a moderate rate,” the Federal Reserve Open Market Committee said in announcing its decision to leave the federal funds overnight rate unchanged.

While the Fed is expected to start raising short-term interest rates if signs of inflation emerge, the economy remains constrained by a “weak labor market, modest income growth, lower housing wealth, and tight credit,” the committee said.

The Fed said it remains committed to continuing through March a program credited with keeping rates on mortgages low. The Fed is purchasing $1.25 trillion of mortgage-backed securities backed by Fannie Mae, Freddie Mac and Ginnie Mae, and $175 billion of Fannie and Freddie debt.

In a forecast published Dec. 8, the Mortgage Bankers Association projected rates on 30-year fixed-rate mortgages will rise for the next eight consecutive quarters, from an average of 4.9 percent during the final quarter of 2009, to 6.2 percent by the fourth quarter of 2011.

The group forecast that the 30-year fixed-rate mortgage will average 5.5 percent in 2010 and 6 percent in 2011, up from 5 percent in 2009.

The Mortgage Bankers Association stated that the average contract interest rate for 30-year fixed-rate mortgages for the week ending Dec. 11 increased to 4.92 percent from 4.88 percent, with points decreasing to 1.08 from 1.17 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.

A separate survey by Freddie Mac showed the 30-year fixed-rate mortgage hitting a record low of 4.71 percent during the first week of December in records dating back to 1971.

If you, or someone you know is considering Buying or Selling a Home in Columbus, Ohio please contact The Opland Group. We offer professional real estate advice and look forward to helping you achieve your real estate goals!

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;  Bexley  Columbus  Delaware  Downtown  Dublin  Gahanna  Grandview Heights  Granville  Grove City  Groveport  Hilliard  Lewis Center  New Albany  Pickerington  Polaris  Powell   Upper Arlington  Westerville  Worthington  

Real Estate Developer Brad Howe, with JBH Holdings, announced today that The Jackson on High project has reached a major milestone by receiving a 100% real estate tax abatement for 10 years. Columbus’ City Council returned the unanimous approval for the tax abatement during the December 14 evening session. The measure would make The Jackson on High the only existing condominium project in The Short North to receive a full 100% abatement.  The Jackson falls within the newly created CRA (Community Reinvestment Area) named “High and Second Community Reinvestment Area – ORD1685-2009”.“

JBH Holdings applauds the tremendous support we have received from City Council, Mayor Coleman and the City of Columbus Department of Development.” Brad Howe stated. “From the very start, Columbus has embraced The Jackson on High and shared in its vision and we believe the achievement of this incredible tax abatement showcases the belief people have in JBH Holdings and its ability to deliver on its promises of high-end luxury at a reasonable price.

”The 100% tax abatement, equal to about 1.9 % of the purchase price per year, would be a major savings to the consumer. For example, a condominium purchased for $300,000 would receive an estimated tax savings of $57,000 over the life of the abatement, or $475 per month. Savings would increase or decrease depending on the condominium’s purchase price and changes in the property tax rates.“

From the very start we decided never to put profits above the consumer,” Howe continued. “While some would introduce an amazing product to Columbus and then strip it down to increase profits, JBH Holdings has remained committed to the consumer by keeping quality high and delivering on promises. We believe promises made are promises kept and this mantra has registered well with City of Columbus officials and the Greater Columbus marketplace.”

The 100% tax abatement comes on the heels of The Jackson on High receiving FHA approval. “Although the real estate marketplace has begun to show some signs of recovery, it is clear that incentives like the 100% tax abatement will be a major enticement to motivate consumers to sign on the dotted line. This coupled with what an amazing condominium product The Jackson on High is, located in the exciting Short North, and you pretty much have an irresistible urban living option.”

More about JBH Holdings

After having established a solid reputation within the real estate investment industry, long time business partners Bradley Howe and John Bonner decided to join forces and created JBH Holdings, LLC. Focusing on identifying and securing development opportunities that offer its investors optimal ROI, JBH Holdings adheres to a strict community and social responsibility in developing real estate offerings that retain value and offer thoughtfully planned dynamic architecture that transcend temporary design fads. For JBH Holdings it is these guiding principles that manage to secure the organization consistent success with each project they undertake.

The Jackson on High, the latest undertaking by JBH Holdings, is an eight-story urban condominium development designed to offer 44 high-end residential condominiums, 4,600 square feet of commercial retail space and 91 parking spaces in an attached garage to Columbus’ popular Short North Arts and Entertainment District. The building will offer a rooftop pool overlooking downtown and High Street and provide many other features that are firsts in the area. Construction began September 7, 2008. The project, referred to by many as iconic will be the anchor to the northern entrance of the Short North.

If you, or someone you know is considering Buying or Selling a Home in Columbus, Ohio please contact The Opland Group. We offer professional real estate advice and look forward to helping you achieve your real estate goals!

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;  Bexley  Columbus  Delaware  Downtown  Dublin  Gahanna  Grandview Heights  Granville  Grove City  Groveport  Hilliard  Lewis Center  New Albany  Pickerington  Polaris  Powell   Upper Arlington  Westerville  Worthington  

This is your final reminder to take a few minutes from holiday merrymaking and get those last-minute tax moves done. You have until Dec. 31. After that, there’s little you can do to cut your tax bill.

Here’s what you can do before the end of the year to trim your 2009 tax bill. I’ll start with the simple things.

What you need to do now

Mortgage interest. Make your January mortgage payment Dec. 31. Send in a check or pay it online.

Remember to add the interest you paid to what your bank reports on its Form 1098. Your bank will get your payment in 2010 and won’t report it for 2009.

But because you paid it this year, it adds to your 2009 deduction. (The downside, of course, is that you won’t be able to deduct the payment from your 2010 return.)

Real-estate taxes. If you pay your own real-estate taxes, make any payments due in the beginning of 2010 by Dec. 31. My fourth-quarter real-estate taxes are due Feb. 1. By paying them Dec. 31, I get the deduction a year earlier. (Again, you can’t deduct payments made in 2009 from your 2010 return.)

A friendly warning: Taxes aren’t allowed as a deduction under the alternative-minimum-tax computation. If you expect to get hit by the AMT, don’t prepay.

Charitable donations. If you contribute to your church, your college, the local dog pound, United Way or organizations contributing to disaster relief, make these donations by Dec. 31. And make sure that before you file your tax return, you have a receipt from the organizations that benefited from your generosity.

If you don’t have the cash, find out if the organization can process a donation via credit card. As long as the donation is made by Dec. 31, it’s valid as a 2009 deduction.

Separately, any contributions of clothes or household goods must be in good condition or better to qualify for a deduction. If a single item has a value of $500 or more, you will need an appraisal. The Internal Revenue Service can deny deductions for items of minimal value.

Complicating any deductions will be new requirements on record keeping. This is important.

To deduct a cash donation, regardless of the amount, you must have a bank record or a written communication from the charity showing its name and the date and amount of the contribution. Acceptable bank records would include canceled checks or bank or credit union statements containing the name of the charity, the date and the amount of the contribution.

Medical and miscellaneous deductions. Medical expenses and miscellaneous itemized deductions have “floors.” For medical expenses, only those in excess of 7.5% of your adjusted gross income (AGI) count. Miscellaneous itemized expenses have to exceed 2% of your AGI to qualify.

An important point: Your health insurance premiums count so long as you’re not paying them out of a flexible spending account.

If you’re going to exceed the floor, accelerate your expenses. Prepay your orthodontist or your tax preparer. Send in your payment either online or via the U.S. mail by Dec. 31. Alternatively, if you’re not going to exceed your floors, defer the deductions to 2010. You may exceed your floors then.

Pension or IRA contributions. These are especially important if you are self-employed. Unless tax rates shoot up, you want to pay your tax “tomorrow” rather than today.

If you’re contributing to a retirement plan such as a 401(k) plan or a 403(b) plan, you can put in $16,500 this year and the same amount in 2008. If you’re 50 or older, you can put in an additional $5,500 as a catch-up contribution.

Cash gifts. If you might ever be subject to the estate tax, make your $12,000 tax-free gift before the end of the year.

Capital gains and losses. 2009 has been a volatile year for investors, if you are one of the lucky who have capital gains, remember that any net capital losses over the $3,000 allowed on your 2008 tax return should be carried forward to offset those 2009 gains. If you still have net losses, up to $3,000 may be used to offset ordinary income for 2007.

All net long-term gains are subject to a maximum 15% rate. If you’re in the 15% or lower tax bracket, your tax hit is softened to only 5%.

If you’re single with taxable income of $31,850 or less, you get the 5% rate. With a standard deduction of $5,350 and a $3,400 personal exemption, you can have as much as $40,600 in gross income and still qualify.

If you have net capital gains, sell losers to offset those gains. If you have more losers, sell at least enough to get the $3,000 offset against ordinary income. If you have shares of stock pregnant with gains and you don’t expect them to appreciate further, sell those shares and shelter the gains with the losses on your losers. Worst case: Pay the maximum 15% tax. You can’t go broke taking profits.

Tax-free IRA distributions to charities. If you’re 70 1/2 or older and looking to make a donation to a favorite cause using funds from your individual retirement account, this may be the year to do it. For 2009, you can distribute as much as $100,000 directly from your IRA without recognizing any income.

You don’t get a charitable-donation deduction (unless the distribution was from a Roth IRA), but the distribution does count toward your minimum-distribution amount.

A note: This provision will expire after Dec. 31 unless Congress renews it. A renewal is expected, however.

4692 Village Club Drive is the definition of luxury living and in fact words can not describe this one of a kind master piece. Crafted to the highest degree of taste and with no expense spared, the property offers approximately 5,000 square feet of decadent living space and encompasses 4 bedrooms, 3 full and 2 half baths.

On the main level you will find a breath taking 2-story grand foyer, a luxurious formal dining room, a fully equipped professional grade kitchen featuring gorgeous granite counter tops and custom cabinetry. This level also include a family room with coffered dark wood ceiling, a hearth room, and a study.

Upstairs you will find the fabulously appointed master suite which includes a must see entry way! The suite itself includes an inlaid tray ceiling, large walk-in closets, a master bath that would rival most 5 Star Spas with it’s heated limestone floors, enormous walk in shower with multiple heads, a large jetted soaking tub and much, much more! This level also includes 3 additional bedrooms and 2 more well appointed baths.

Lower level is both elegant and dramatic and includes entertaining spaces that are warm and inviting. A media room, ornate english pub (featuring a sink, dishwasher, and full size refrigerator) as well as a wine cellar are a few of the amenties featured.   This home features finishes and appointments rarely found in multi-million dollar properties, let alone homes priced under $900,000. This is truly an exceptional property and a unique opportunity!

Overview

Price: $850,000    Sqft: 5,000    Beds: 4    Baths: 3.2   City: Powell    Zip: 43065

Community: Estates of Golf Village    School District: Olentangy   

For more information on this property, or to schedule a showing please call us at (614) 408-8078 or email us at theoplandgroup@gmail.com.

If you, or someone you know is considering Buying or Selling a Home in Columbus, Ohio please contact The Opland Group. We offer professional real estate advice and look forward to helping you achieve your real estate goals!

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;  Bexley  Columbus  Delaware  Downtown  Dublin  Gahanna  Grandview Heights  Granville  Grove City  Groveport  Hilliard  Lewis Center  New Albany  Pickerington  Polaris  Powell   Upper Arlington  Westerville  Worthington