Tag Archives: santa maria real estate

What You Need To Know If Buying A Condo?

All right here are some tips for you provided that you happen to be trying to buy a condo in the Santa Maria real estate market or where ever you plan on shopping for one, and what you need to be familiar with before hand.  Initial thing to keep in mind just like not all people are created equal and neither are all homes or condos and more importantly not all Condo associations!
The real estate market has quite a bit of condo complexes and with a number of  of them for sale,just like the homes in Santa Maria some are better than others for a number of reasons.  some of them are run very well and others not so well in addition to are underfunded.  The problem is when a condo association is having problems in addition to you purchase condo within that association their problems now become your problem.
Okay here are some tips for you assuming that you happen to be trying to buy a condo and what you ought to be familiar with before hand.  Initial thing to keep in mind just like not all people are created equal and neither are all homes or condos and more importantly not all Condo associations!
The real estate market has quite a bit of condo complexes and with many of them for sale.  A few of them are run very well and others not so well in addition to are underfunded.  The problem is when a condo association is having problems and you buy condo within that association their problems now become your problem.  When you acquire a condo you basically join a club in addition to take on a portion of the issues which they can be having.  So there are few steps that a person needs to keep in mind when considering a condo, because your decision is something that you will have to live with daily as you continue to own that condo.

1)      What is the Home Owners Association fee in addition to what does it pay for?

Generally this is just acknowledged as the HOA dues you could surely discover that some of those HOA dues as high as almost $400.00 per month.  Which is an extra $400.00 added toward your monthly payment on top of the loan on top of the taxes in addition to on top of the insurance, nevertheless I think you get the idea.  The HOA dues alone could make you or break you as to whether or not you will qualify for that condo or whether or not you even want to consider purchasing it.  The fee comes from the annual expenses to maintain the common areas such as the club house, the pool etc.  It is also a result of whether or not the association is professionally managed or self managed.  Provided that this is going to be your new monthly fee you need to recognize what your getting for what you pay for.

2)       Why Do HOA have rules?

This can unquestionably make acquiring your condo one extremely regrettable decision, considering the rules might prohibit pets, or even your ability to rent out the unit.  You will want to get a copy of the bylaws to see if there will be anything that you can have issues with.

3)      What is the percentage of renters vs. owners?

Usually renters do not at all possess the similar level of consideration for the property they abide in.  Whether or not it be a condo or a home too many renters tend to give unwanted issues.  Another consideration is that provided that there is too many renters in the condo complex the condo may not qualify for FHA financial backing.  Even with the condition that you were to acquire a conventional loan instead of an FHA loan and this was to be your primary home it may have to be financed as investment property due to the high number of renters.  A loan for investment property is normally an extra 1-2 points than the going rate for house which would be considered your primary home.   This could be a problem for certain communities when many homes for sale in addition to condos were bought by investors in the middle of the market frenzy many were used as investment properties.   Use the link below to find out if the Condo you anticipate on procuring will qualify for FHA funding due to having too many renters.

Here is the link to find out if your condo complex may or may not be approved simply go to:

4)     How much cash exist within the reserve fund account?

This is probably the most overlooked in addition to never actually taken into account until it is too late.  Procuring a condo you become part owner of the association in addition to a good number of  the bills which come with it. So with the condition that the association is poorly run or funded the condition of the condo complex as a whole can deteriorate.  Or a lack of funds can be an indication of possible litigation draining the fund which will eventually require a special assessment in regards to all those that intend to keep there condo units.  Reality just like individuals having to cope with bills and bad credit, a condo complex can end up having the issues when the bills and funds to pay them are not available.  You want to know is there an increase of delinquent owners if so the reserve fund will come to be drained.  Request a copy of their budge to look into if there can be any indications for concern.  The last you want is to do is to get a condo plan on a budget and get hit with new and higher HOA dues.   Don’t let this scare you seeing that obtaining a condo does have its benefits such as no yard and maintenance for some of us its simply not at all on the schedule in addition to it does every so often furnish you the luxury of having a pool and lets not forget the hot tub.  A few Condos even possess security which is a nice added benefit for anyone with kids especially supposing that you happen to be a single mom.  Basically look past the price in addition to make sure you will be happy with the condo association in addition to its rules and fees.  Getting a condo is not at all similar to buying a TV ,,,you can’t take it back supposing that you’re not happy with it.

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Do You Understand How A Short Sale Will Influence Your Ability In Purchasing Another Home

There is alot happening within the realm of real estate every where not just in the Santa Maria real estate market and that holds true with just about all the mortgage home loans having to go  bad, and unless you have been existing under a rock then you ought be some what familiar with the expression short sale which has come to be as familiar as the word foreclosure.   Quite a bit of of you that live in either a house or condo regardless of whether or not you own it or not, you have had reminders left on your building, that there are a whole lot of people eager to accommodate to do a short sale and that it is much better for someone to do than it is a foreclosure, (I have left a few myself on a few doors).  For those that do not know what a short sale is, which is basically when a homeowner sells his place for less that what he currently owes.  now there are some benefits to doing a short sale, first one is when do you need to be a homeowner again?

Supposing that you may be able to compel your lender to allow you to do a short sale even if you have not missed any payments.  Then FHA will allow you to acquire another home the next day, as long as the home you are acquiring is not at all superior to the home you now have.   The challenging  part will be getting your lender to let you to do the short sale, a lender may refuse to allow you to do a short sale, as stated before this is the difficult part procuring the approval when you have not missed a payment and a short sale transaction normally takes months to close.  Assuming that you do miss payments and you do a short sale, FHA guidelines now state that you have to wait at least 3 years, before you could purchase another home provided that you were to try to acquire a FHA loan.  This is where carrying out a short sale and just letting your place go to foreclosure genuinely does not at all make a difference in you getting financing again.  Now the 3 years is from the date of closing not at all from the date you stopped making payments or the time you initiated the process towards your short sale or foreclosure.

But now moving on to other loans outside of simply an FHA there are a few differences when it comes to obtaining a loan other than a govt. loan, and doing a conventional loan.  Currently Freddie Mac and Fannnie Mae are the two largest investors at this time.  These two humongous govt. sponsored corporations acquire pretty much all the mortgages out there that the banks are now doing, reality is that most of the homes in Santa Maria are being done via FHA.   With the condition that you do a short sale and from the date of closing your transaction your waiting period is merely 2 years to buy another house.   In any event please keep in mind if you are on a separate loan whether it is investment property or you co-signed on it, there can be no mortgage lates within the 12 months of application.   With the condition that you foreclose then the waiting period is 5 years from the date of your foreclosure date.  That is a huge difference in regards to getting back in the market in addition to becoming eligible to obtaining sponsorship and becoming a homeowner again.  Then it depends on credit, what is your credit going to be, its a fact that after doing a short sale or foreclosure you will be dealing with bad credit but its only temporary???

Keep in mind houses are so very much less now and I seriously doubt they will be doubling in 2-3 years time in essence if the house is unaffordable now you can be in a preferable financial position in 2-3 years in addition to with less stress.   In closing on the assumption that you find yourself in a position of conceivably having to do a short sale or losing your house you are not alone and for many when taking their finances into consideration a number of  homeowners have come to learn after some time that it could be a blessing in disguise.

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Why You Should Do A Short Sale Soon!

There are consequences of doing a short sale whether it be within the Santa Maria real estate market or anywhere your house is located this is on the grounds that you owe more relative to your  mortgage home loan than what your home happens to be worth at this time, this is when you are upside down.  Do not get me wrong there are some benefits to a short sale as well, but we are only going to touch a little bit about the dark side.  Reality therea are millions of homes owners facing this and many of the homes in Santa Maria are short sales at this time.
Assuming that you read my last blog then you read with respect to the benefits of carrying out a short sale supposing that you did not you might want to visit that blog seeing that there are some benefits as to why you would want to do a short sale vs. letting your home foreclose if you do not qualify for a loan modification.  The  majority of Santa Maria homes for sale in addition to quite a bit of likely in Calif. are either a short sale or a foreclosure and a number homeowners could be contemplating what course of action to do whether to do nothing but walk away or work in connection with doing a short sale.  So if you are on the fence of just walking or doing a short sale maybe this can help.

You need to take into consideration that you owe $400,000.00 on a house that is just worth $200,000.00.  What takes place towards the difference???

First we choose to talk with reference to the IRS, the Feds also then we choose to talk in regard to the effect with regard to a state level regarding in what way or manner they look at that $200,000.00 dollar variation.   nonetheless what takes place provided that you do a short sale does the bank eat the difference,  The response depends relative to where you live.  You will have to look into the laws of your state, for instance provided that a bank agrees to do a short sale in the state of California whether it be a first or a second the bank will not be able to  come after you for the deficiency amount.  For instance if you had a second on your home in a foreclosure they may be able to take you to court for what you owe them.

Most reading this are probably thinking that’s cool sign me up also let’s do a short sale.  The only problem is that the IRS considers any canceled debt as ordinary income, even when dealing even with credit cards in reference to working on settlements.  So but now the picture is not so rosy especially with the condition that you have never made $200,000.00 in your life in addition to at this time looking at a tax bill of $200,000.00.   supposing that you do a short sale you will be receiving a 1099C for 200k with the condition that you do a foreclosure you will receive a 1099A, these will need to be filed even with your tax return.  So now what should you do?  You should have a couple of alternatives and do please keep in mind try to go to someone that is incredibly experienced with taxes this is not something you want to just let anyone do for you.

So here are some Exceptions towards the rule on paying taxes.. Listen up 😉

1)      The IRS will not collect taxes with respect to the deficiency amount assuming that the homeowner filed Bankruptcy also included the deficiency amount.

2)      The homeowner filed insolvency at the time of cancellation of debt, which means that you owed more than what you have in assets you do not have to file BK this may be done at the time when filing your tax return.

3)      assuming that this was a rental property in addition to you could offset debt by other business liabilities in addition to expenses basically back to being insolvent.

with the condition that you just let the home to go to foreclosure no worries this is straight from the IRS themselves

Update Dec. 11, 2008 – The Mortgage Forgiveness Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection let alone a foreclosure, qualify for this relief.  bear in mind DECEMBER 31, 2012 SO with the condition that YOU ARE THINKING OF carrying out A SHORT SALE DO IT SOON!!

This provision applies towards debt forgiven within calendar years 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exception ($1 million if married filing separately). http://www.irs.gov/newsroom/article/0,,id=174034,00.html

In closing the benefits always do out weigh the consequences in doing short sale vs. a foreclosure.  Biggest benefit would be when do you want to become a homeowner again, and stop having to deal with what is going to happen next,  both will impact your credit just one impacts it slightly less.  This was just a brief summary of the tax consequences involved as well as you will need to seek the counsel of somebody that can help you with filing for your taxes.  The real estate market will still have a few years of dealing with foreclosures in addition to short sales as the primary source of homes on the market.

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How To Avoid A Legal Issues When Buying A Home

Talking about real estate litigation, it is the routine of finding a legal method to disputes pertaining to real property. Reality is that sometimes disputes happen with those that are learning how to buy a home not just in the Santa Maria real estate market but every where. Keep in mind that it doesn’t really matter whether that particular property is in the stage of ‘developed’ or not. Often, this kind of litigation arises from disputes at the time of buying, financing, or property development.

Number of attorneys, more so in bigger metropolitan areas usually have expertise in this area and are fully aware of the complicated contracts that are associated with the real estate.

Contracts to buy real estate are one of the most common kinds of litigation. There is a strong possibility that the disputes may occur due to vague language in the contract, or because of the fact that both parties did not the read the contract in a proper manner. In this scenario, any contract breach may be settled out of court. If one party is not in favor of out of court settlement, then there is no other option than to go for a court hearing.

Real estate litigation is also going to happen when there are issues related to construction contracts. In few cases, the contractor and the real estate developer may have an issue regarding the project scope or the finished work quality. If the issue is pertaining to quality, it is the responsibility of a lawyer to gather proofs with the help of an expert. This expert is going to analyze the work and is going to give the comprehensive detail of it to the court.  Even some of the homes in Santa Maria have had issues where the homes were built on top of old oil sumps and the homes had to literally be demolished but of course this was the result of legal litigation.

If the money has already been given according to the contract, then the party concern may need to refund it partially or fully. Conversely, if money has not been given as yet, judge will decide how much one party needs to pay to another party.

When it comes to real estate litigation, financing disputes are pretty much a rarity, but there are cases when it does happen. For example, if two companies decide to share the financing cost and disputes occur, there is a good chance that one company may take the other company to court. If there is a written contract available, court is going to give the judgement on the basis of that. Further, if you are of the opinion that your mortgage lender has not been fair, you can go to the court. For this, you need to take the services of a property attorney.

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If You Stop Making Payments On Your Home

So what happens if you stop paying on your mortgage home loan.  This is a pretty basic outline of what happens whether you are in the Santa Maria real estate area or not.

So if you get to the point that making your mortgage payments on your home is more than you can do before you completely stop paying first thing is try calling your mortgage company.  You may want to see if you can get a loan modification on your loan.  Just be careful on not getting scammed on trying to get loan modification and not getting ripped off.  Banks have gotten a little bit easier to deal with but are still a challenge when trying to get a loan modification.  But when it comes to either losing your home or getting a loan modification what do you have to lose in trying?

But the question is what if you just know you will not qualify for a loan modification because you don’t have a job.  Because regardless of what you have heard you have to show proof of income to get a loan modification.   Some lenders will offer you a forbearance which is usually a temporary payment plan but it is not a load modification.  But it can buy you some time to avoid foreclosure.  They usually don’t even ask for any proof of income but at the same time it is temporary and if you can get them to reduce your payment to where you can afford it for the next 3 to 6 months.  You might be able to avoid foreclosure all together.  Keeping your home off the market and joining the ranks with many other home owners just remember you are not alone, if it comes to this.

If the lender is not willing to work with you then it will lead to them having to file a notice of default on you (NOD) on your home.  With county recorders office.  Usually this happens 3 months after you have not paid your mortgage payment.  But things have changed with so many homes going into the foreclosure process it many even be 6 months before they even file a NOD on you.  Once the NOD is filed it’s the start of the foreclosure process.

Now you have to remember these are not normal times we are currently living in and time frames in today’s real estate market are taking longer than normal.  If another 3 months passes.   Then this is where trustee comes in to play and files a notice of sale.  This is where they auction your home off at the county court house. The notice of sale is published locally in a local paper with your name and address and the amount of the note or mortgage and the date of the trustee sale.  All the embarrassing and pertinent information needed.  It will come out at least once a week for next three weeks.

 

Now this is still your redemption period if you can come up with all payments owed and fees etc etc.  Now once the home goes to the auction block anyone can buy it at the highest bidder above what the minimum bid has been established at the auction.  Sometimes the minimum bid is what is owed on the home and the home is not worth the loan amount anymore.  And if no one bids on the that is when it just goes back to the bank since no one is going to pay  for a home for more than what it is worth.  Some times the minimum bid is actually less than what is owed and it can even be less that the actual value of the home giving the buyer a sweet and profitable deal.  But the catch is that it must be in CASH at the spot usually MUST HAVE CASHIERS CHECKS IN THE AMOUNTS OF $10,000.00.  at least in the state of California.  You might want to check how your state processes buying a home at the foreclosure auction.  Also keep in mind any issues or problems with the home become your problem.  There is no disclosures at the auction house.  There is no getting a loan or thinking about it, this is a do it now, or move on situation.  So as you can tell its not for everyone and who ever the buyer is also accepts any issues that the property has so if its your home I am sure you know what issues the house may have if not then I hope your did your homework.

For A FREE List Of Foreclosures & Pre Foreclosures On The Central Coast Click HERE

If you have any questions about buying or selling home as well as getting loan, I have been helping my clients for the last 15 years on the Central Coast, take a look at some of the Santa Maria homes for sale.  And Give me a call 805-448-7101 , DRE 01321588

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Important Disclaimer: Questions and answers provided on this website and by Gene Perez is to be considered general information, and is not intended to substitute for informed professional financial, tax, legal, investment, accounting, or other professional advice.

Gene Perez is Licensed Real Estate Broker for Valley Hills Realty and a mortgage broker for Greater Mortgage Solutions.

This blog and its content is copyright of Gene Perez 2010. All rights reserved. Any redistribution or reproduction of part or all of the contents in any form is prohibited other than the following: you may print or download to a local hard disk extracts for your personal and non-commercial use only. You may copy the content to individual third parties for their personal use, but only if you acknowledge Gene Perez as the source of the material You may not, except with our express written permission, distribute or commercially exploit the content. Nor may you transmit it or store it in any other website or other form of electronic retrieval system without obtaining Gene Perez’s

 

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