Beginning March 1st, Fannie Mae and Freddie Mac will begin the process of allowing some home owners to cancel their underwater mortgage debt using a deed in lieu foreclosure alternative. If you are wondering how and if this applies to your home, read on.

If you have needed to move for job relocation, status changes, or reasons relating to illness or because of needs relating to military service, but couldn’t because of the inability to sell your home, you can benefit from this change. Deed-in-lieu transactions are being offered to struggling home owners who are current on their mortgage or less than 90 days late on their payments, although there are rules and consequences.

To qualify to turn over your home without penalty, you must have house payments that equate to equal or more than 55 percent of your monthly income and be able to show documented “hardship.” Your home must also be in good shape, meaning not damaged and relatively clean. The benefits of this option are that the decision making process can progress more quickly and simply, and that properties will remain in good condition helping neighborhoods improve, and in some cases, borrowers may even receive financial relocation assistance.

While this solution does not fit everyone’s needs (since it could require use of retirement funds to pay part of the loan balance) and is only valid for use on primary morgages, it definitely will be of help to some. Up to $6,000 can be used by mortgage lenders to negotiate loan release for borrowers. Find out more by clicking here.

In the last six years the housing market and mortgage lending professions have seen a lot of change. Click here to view Best Intentions: The Highs and Lows of the Home Affordable Modification Program, a report which outlines these historical events in the real estate market produced by the Consumer Federation of America.

If you thought you no longer qualified for tax savings on improvements done in 2011 or 2012, you’ve had a reprieve. The American Taxpayer Relief Act of 2012 extended residential energy tax credits for existing energy efficient homes retroactively, meaning that certain improvements made on your home since the former expiration date of 2011 now can be applied.

In fact, the extension actually gives you an extra year if you are still working on a project or would like to start one, since the wording has been changed requiring that the improvement must be started by December, 31, 2013 to qualify.  Not all energy-efficient measures and appliances are approved, so if you installed or are thinking of installing a biomass stove, HVAC system, insulation or roofing, non-solar water heater, or windows, doors, and skylights in your home in 2011, 2012, or 2013, you should take a more detailed look at the credit outlined in the Taxpayer Relief Act.

Residential tax credit information is found on the Internal Revenue Service form 5695 relating to items that qualify for a 10% credit of up to a lifetime limit of $500. Please note that window replacement in your home can only represent up to $200 of that credit. If you purchase or purchased a geothermal heat pump, solar energy system, wind energy system, or fuel cell, you may be entitled to credits of up to 30% of their cost until 2016, as well.

In addition, the American Taxpayer Relief Act of 2012 also extended contractors of non-manufactured energy efficient new homes a $2,000 credit and a $1,000 credit for manufactured energy efficient new homes, providing incentive for more energy-efficient homes to continue to be built.

As always, please consult with a qualified tax consultant for details on how these extension can affect you and your home or visit energy.gov for updates.

If you have been considering a short sale for your home, you’ll be excited to know that the Mortgage Forgiveness Debt Relief Act of 2007 was extended through the end of 2013.

The Mortgage Forgiveness Debt Relief Act extends mortgage cancellation relief for home owners and sellers through disallowing taxes on the portion of their mortgage debt forgiven by their lender.

As short sales have represented a large sector in the housing market of late, the extension is seen by many as key to a continued recovering housing market. According to the U.S. Foreclosure & Short Sales Report™ complied by RealtyTrac, the last quarter of 2012, showed short sales as representing 19 percent of residential home sales in the United States. See the full report by clicking here.

According to RealtyTrac Vice President Daren Blomquist, the increase in short sales and distressed properties showed that “both lenders and at-risk homeowners are realizing that short sales are often a better alternative than foreclosure.” Blomquist went on to explain that had the Mortgage Forgiveness Debt Relief Act expired, homeowners would have seen their income tax increase since the unpaid loan balance created by the short sale would have been considered taxable income for many home sellers.

With this recent extension, if you are a home owner interested in a short sale for your home, you now have until December 31, 2013 to benefit from the reduced taxes provided by Mortgage Forgiveness Debt Relief Act.

A quick look over the last few years has more than a few homeowners concerned about natural disasters and power outages. With cold weather quickly approaching (and some predicting an impending end to the world), it is important to take steps to ensure your safety and the safety of your home, in any situation.

One way of doing so is to secure adequate power for your home in the event of an emergency. Purchasing a fixed or portable gas-powered generator can bring peace of mind for many of the instances mentioned above, and particularly so if you run a small business from your home.

When purchasing a generator for your home and home office, you’ll find many choices making a little research necessary. For example, pricing factors may have you decide to purchase an 8000 watt generator knowing that you’ll need to adjust breakers for certain appliances, rather than a 10,000 watt generator that could cover your full needs. Generators can cost anywhere between $300 and $2,000 (and more) so consider asking a professional for advice or installation on this project and following these guidelines from FEMA.  Also, be sure to check the manufacturer model number and date to avoid purchasing a recalled machine.

• First, Determine Your Needs – Evaluate what essential appliances and electronics you will need to run if power is lost. Likely you’ll need to consult with an expert to determine the wattage or amperage needed to keep you powered in style (or at least a state of survival), but you can also check online to find calculators to determine the wattage you need. In addition to the generator, you will need heavy-duty extension cords (not those seen with typical household use) or a special switch and backup panel that allows for power transfers.
• Next, Determine Storage & Use Location Near Your Home – Your generator should be kept between ten and fifteen feet from the house to reduce any risk of carbon monoxide poisoning, however zoning specific to your area and manufacturer warnings should be heeded, as well.   A generator should ALWAYS be used outdoors, away from enclosed areas or areas near home ventilation.
• Lastly, Don’t Wait to Test – Once you have set up your generator, make sure it works properly BEFORE an emergency. Try out various appliances and see how well your power lasts. Checking the generator beforehand should also give you an idea of how quickly it uses fuel, allowing you to plan accordingly for the needs of your home. Once you are sure it works correctly and that you understand how to use it, prepare your generator for storage using the manufacturer’s guidelines and place a calendar reminder so that you remember to test it on a regular basis.

Have you been wondering what changes and developments in the 2013 housing market will mean for your home? If so, you’re not alone.

A series of  predictions  published on December 10, 2012 by Frank Nothaft, Vice President and Chief Economist of Freddie Mac may provide some clarity.

Review the bullet points below or watch the video focusing on five housing features outlined by Mr. Nothaft on expectations Freddie Mac holds in regards to the housing market and your home in 2013.

5 Freddie Mac Expectations For Your Home in 2013

• Mortgage Rates – Freddie Mac expects to see rates below 4 percent throughout 2013, making purchasing your home easier for most buyers.
• Home Values – Freddie Mac believes there will be an average increase in the value of your home between 2.5 and 3 percent over 2013, with some neighborhoods outperforming this estimate and others underperforming, creating a national average increase.
• Growing Number of Households – Freddie Mac predicts that an additional 1.25 million households (net household formations) will be created in 2013, providing more demand for your home.
• Decreased Vacancy – As new households are formed, more properties will be filled, allowing for a natural decline in the vacancy rate.
• Less Refinancing for SFR – Though rates will continue to be low throughout 2013, Freddie Mac suggests that single family residences will be doing less of the refinancing while a substantial increase will be seen in multi-family lending, resulting from accelerated building of apartment and multi-family investment properties.

Headlines about the fiscal cliff may lead you to think that housing transactions are tapering off, yet according to the Fannie Mae National Housing Survey for November, that simply is not the case. In fact, Americans are displaying more confidence in the housing market and economy than previously shown, which is good news for your home!

Doug Duncan, senior vice president and chief economist of Fannie Mae stressed in a recent report that, “Consumer attitudes toward both the economy and the housing market continue to gather momentum, with many of our 11 key National Housing Survey indicators at or near their two-and-a-half-year highs.” He continued by concluding that “attitudes about the current selling environment continue to improve, with a significant increase in those saying it would be a good time to sell.”

Five percent more of the November survey respondents believe now is a good time to sell a home (shown at 23%) as compared to October, recording the highest percentage in over 17 months. Nearly 41 percent of those surveyed felt that mortgage rates will be increasing soon and 14 percent believed home prices will decrease in the next twelve months, while 37 percent believed home prices would increase. Respondents are confident on the ability to get a mortgage, with 51 percent believing in the possibility.

Forty-eight percent of those surveyed predicted increases in rental prices and 67 percent reported that they would purchase a home if the need to move arose, giving you more options should you decide it is time to sell your home. Click here to access the Fannie Mae November survey data and graphs.

When viewing the exterior of your home, where does your eye focus first? If you have no cars in the driveway, more than likely you’ll notice the garage, a wide expanse that may or may not be beautiful. If your garage exterior happens to fall in the “not so appealing” category, it may be time to consider a new garage door.

While a garage door is not generally of prime concern as long as it works properly, it really can enhance the “look” of your home. The following suggestions outline what to ask and how to find the garage door that will best suit your needs and those of your home.

• Think Materials – Wood, Aluminum, Steel, Fiberglass, Windows or Not? Remember that windows can be more easily broken and increase the ability to “see” what is in the garage, potentially increasing risk of burglary or repair. However, they are more attractive and let in more light if you will be working in your garage often. Ask whether the door will be able to be locked manually as a security feature while you are away from your home for extended periods, too.
• Consider Existing Size – One car or more? Knowing the width, height and depth of the current door will help you in knowing which models to view.
• Snowball Effect – Will replacing the door require a replacement of the garage door opener? Should you upgrade that equipment, as well?
• Safety First – Make sure that the garage door for your home has a retracting feature to detect interference from small children or pets.  As with any upgrade you make to your home, safety needs to be considered alongside beauty.

If you are considering investing in real estate in the new year or in selling your home that was recently purchased, you’ll be excited to know that the Federal Housing Administration has agreed to a temporary extension on the waiver on home flipping.

At one point in time, home owners were required to hold title for more than 90 days before selling their property. Now, however, you can buy your home, fix it up, and resell it without time restrictions, per the original policy put into place in 2010 by the Obama administration.  Since 2010 the extension has been granted on a yearly basis, but this announcement extends it for two years.

The renewal of this policy, announced at the end of November, will remain in force until December 31, 2014 to allow security to buyers and lenders who wish to engage in these practices. The waiver is subject to certain restrictions, and may result in an increase in available home inventory.

According to Carol J. Galante, Acting FHA Commissioner, the extension was granted to increase resales of foreclosed properties in struggling neighborhoods. He said,  “FHA remains a critical source of mortgage financing and stability and we must make every effort to promote recovery in every responsible way we can.”

Learn About How the Extension Affects Your Home and Neighborhood

To read the actual waiver and restrictions placed on anti-flipping regulations, such as the need to show renovations and an inspection to support a sales price increase of greater than 20%, click here.  If you are interested in learning more about investing and how this change can impact your home, give me a call.

In some ways, finding the perfect holiday gift is very similar to buying a home. You may spend a lot of time researching and thinking about your home purchase. You’ll probably even seek the advice of an expert as you test out the many styles and sizes, however in the end, you’ll know when you’ve found the right one. And, while it may not be perfect, it will be a good fit for you and you will soon find yourself happily settled in your home.

You will likely find some surprises along the way to buying your home. Buyers are often perplexed at the time and process involved with a home purchase and having a knowledgeable real estate agent is a key to moving quickly in any home sale.

Another even more important aspect is knowing what you want as a home buyer. If you can map out the must haves and wants and communicate those to your agent, you will not spend needless time surveying properties that are of no interest to you and will find your home much sooner.

Hang-Ups to Buying Your Home

No Representation - While it’s true that you can search Craig’s List, websites, and visit open houses on your own, you as a consumer are not near as schooled in the local housing market as a local real estate agent would be. Smart shoppers often ask for advice and read reviews before making a gift purchase, and shopping for your home is much the same.  Another benefit to having a knowledgable real estate agent is in the power of negotiation. There is an art to buying and selling real estate and a true professional can often negotiate offers, terms and pricing that will win you your home.

Lack of Vision - Look beyond the initial home tour and study the “bones” of the house. Consider how different paint and flooring could transform any home, and trust your real estate agent to advise you on whether or not the property is a diamond in the rough. A little maintenance, redecorating, and repairs can really update your home and seeing through rose colored glasses could win you a better deal on your home, too. Do, however, get an inspection on any property to make sure that the repairs are not more than you can manage.  Gift shoppers go through this step, as well, when making discounted purchases.

Understand Your Nonnegotiables - Don’t compromise on items you think are essential. If you need RV parking, do not settle for a home that is lacking it and has no way to expand the drive. If you feel like you need a swimming pool, only look at homes with pools. Big changes such as these will be hard to make at a later date and may undermine your overall home satisfaction. It is acceptable to wait to find a home that can better accommodate your needs.  And, with gifts, buy something that truly “fits” the recipient.

Look Ahead - Buy your home (and holiday gifts) to meet current needs, but also contemplate possibilities lurking in the near future. If a need for a nursery and quiet cul-de-sac loom in the future or a potential new job requires a lot of entertaining, it may be wise to consider those plans in your home purchase.

Is a clean house on your list for Santa this year? If not, it may be worth considering since time just seems to evaporate this time of year.  Between attending community and work socials, school events for children, and family gatherings, it seems there is little chance to enjoy the season while still keeping up with tasks related to maintaining your home.

Perhaps you feel guilty having someone else clean your home.  If this is the case, consider the many other jobs you outsource during the holidays, from dining away from home to babysitting or gift wrapping services, and recognize that it is allowable to treat yourself to a more relaxed and festive end of the year, through hiring someone to clean your home for you this December.

Some Tips to Consider When Hiring Someone to Clean Your Home

• Ask for a Referral – Whether you hire based on a recommendation of a good friend or your Realtor, quality matters in housekeeping so you want to make sure someone you trust feels confident in the ability of your cleaning crew.
• Define the Tasks – Depending on your home, the amount and type of cleaning will vary.  Be specific about any requests related to vacuuming, sweeping, mopping, dusting, dishwashing, window cleaning, laundry services, bed making, and other tasks so that your needs will be met accordingly.
• Consider the Details – Ask about bonding, licensure, screening, and training and be present at the first cleaning to ease your comfort level, if needed.  Point out areas needing special care or that will not be accessible and offer explanations, as warranted.
• Determine Price & Supply Needs – Negotiate the price of your cleaning prior to the work being done.  Keep in mind that you have several options, from one-time service to weekly, bi-weekly, monthly, and live-in cleaning options and will typically see a discount in rates with more frequent cleaning.  Also ask if you need to provide anything (vacuum, cleaning supplies, etc), since many services bring their own supplies.
• Ask for Clarity – Once you’ve determined the work to be done and agreed on a price, ask what you can expect.  Will you be having one person or a crew cleaning your home?  Will they return on the same day and time each visit?  Will the crew rotate or can you expect to see the same cleaner(s) each time?  How is payment to be made and do you need to be present while the cleaning is being done?

Then, sit back and relax knowing that one of the stresses of the holiday season has been delegated.  Go out and have some fun and then enjoy returning to your home, your newly cleaned and sparkling home, that is!