It Is Time to Buy in Chicago, IL Find Out Why?

Originally posted 2009-05-04 05:10:37. Republished by Blog Post Promoter

Are you in the market for a home, but are unsure if now is the right time to purchase a home?  Well, you are in luck.  According to an article in the Chicago Tribune, properties are at its lowest prices along with the market having the lowest interest rate in over 30 years and recently the market experienced an increase in sales of homes.  In “March sales of previously owned single family homes and condominiums in Illinois posted their second consecutive month over month gain, and for the first time since June, the statewide median price for a home rose from the prior month.”

 

Every county seen an increase, for instance,

• Lake County sales increased by 65 percent
• Kendall County sales increased by 51 percent
• Cook County sales increased by 38 percent

 

There may be number of factors that are causing the increase in sales to include

• 8,000 non-repayable federal tax credit first time home buyer program
• the lower interest rate on 30 year loans

 

Even though it is a good time to buy, it is still important to make sure that the buyer understands that in order to make sure that the home that he or she is interested in purchasing is a good investment the buyer needs to have a home inspection.  The home inspection lets the buyer know the condition of the electrical, plumbing, roof, etc.  The buyer will know based on this report if there are items that must be taken care of now or are deferred maintenance and can be taken care of in a couple of years.  This information is valuable if the new potential homeowner does not have much money for unexpected repairs to the home. 

 

Still yet, buyers are being advised that they will find good deals in this market that they would not have found two years ago.  Sellers who are selling are being advised to list their homes lower to ensure that the homes are sold at a quicker pace and available to more buyers.

 

 

What Is Assessed Value and How Does It Influence My Property Tax

Originally posted 2008-12-23 15:35:34. Republished by Blog Post Promoter

In Indiana, the property tax that is paid on a home, land, building, business machine, or product for sale is determined by the assessed value that the assessor assigns to the asset.  Once the assessed value is determined the amount of property taxes paid on that value is determined by the tax rate for the city in which the property is located.

The tax rate is a very important part of the equation because the tax rate is determined by the budget the town officials believe is needed to run the city.  Items that are needed to run a city vary, but most city rely on property taxes to provide the following items to the citizens of that city:

• police
• fire safety
• library
• school
• health care department
• trash pick up

Some cities have all of these items on the property taxes making the cost to run the city very high.

Now, that the basis of what is included in the property taxes have been discussed.  Let’s look at the changes due to re-assessment of property taxes in Indiana.  In December 1998,  the Indiana Supreme Court ruled that the assessment value that was being used was unconstitutional, and the state needed to convert to market value.   Market value is thought to be more uniformed and fair.  It also satisfy the Supreme Court.   However, the change would cause an unfair change in property taxes adjustment to the homeowner.  The homeowner would see an increase of up to 33% and the business owner taxes would see a decrease of up to 18%.

In an effort, to reduce the burden that the reassessment was having on the homeowner, the Indiana General Assembly develop a bill to protect the homeowner.  The bill was to increase the sales tax to offset the property tax burden.  However, the bill did not solve the entire problem, and now the state is considering an uniformed flat rate of one percent of assessed value for homeowner, two percent of assessed value for landlord or investor, and three percent of assessed value for business owners.

Real Estate Investor Related Articles

Protecting Your Investments – This article discusses the business entities that are available that are available for investors to protect their personal assets when buying and holding properties.

Property Tax Related Articles

Indiana Property Tax Appeal (Part 2) -Filing a property tax appeal can be difficult.  This article gives links to the forms needed to file the appeal and a video tutorial on filling the forms out.

Related articles on property taxes

• Talk turns to tax hikes (theolympian.com)
• States and Towns Lean on Taxpayers (online.wsj.com)

I am a first time home buyer. What next?

Originally posted 2008-11-29 14:02:54. Republished by Blog Post Promoter

As a first time home buyer, there are things that are important to your successful ownership of your first home. The most important things that will make you successful in home ownership understand your market, understanding your mortgage, and knowing what you can and cannot handle.

Why is understanding your market important? Understanding your market is important because it is important to understand your leverage. By leverage, I mean, knowing whether it is a buyer’s market or a seller’s market. Knowing the difference can mean money in your pocket or money left on the table. Let’s examine.

In a buyer’s market, the buyer must be aware that being in a buyer’s market doesn’t make the buyer’s job any easier. It just gives the buyer more flexibility. Remember in a buyer’s market, there may be several buyers for one property or only one buyer for a property. If there are no other buyers for a property by virtue of the length of time the property has been on the market then a low offer may come in to the seller. Sorry sellers. However, sellers that do not mean that you have to give your properties away, but it may mean that you may have to settle for less than you anticipated selling your home.

Another thing that makes a buyer’s market advantageous to the buyer and not to the seller is that there are a lot of homes to choice from that may meet the buyer’s criteria.

In a seller’s market, on the other hand, the seller has the upper hand. The seller can price their home significantly above market value and negotiate the purchase price to exact what the seller wants the purchase price to be. Sorry buyers. If the buyer really wants a home in a seller’s market, the buyer must succumb to the seller’s terms in order to get the home. As a matter of fact, in a seller’s market the inventory of homes for sale that may meet the buyer’s criteria are fewer.

Why do you need to know what you want in your home? It is important in a word to eliminate or limit competition. If the buyer knows what they desire in their new home sooner in the buying process they can narrow their search criteria and bid on the property of choice instead of witness the home being purchase by someone else. In addition, only you as the buyer know exact what features you want in your new home. You, as the buyer know if your family needs three or four bedrooms one or two bathrooms, but more importantly you know what you can afford.

Why am I talking about “what you can afford?” Well, the reason is that your pre-approval letter has a different meaning than you think. The pre-approval is determine by your income to debt ratio true enough; however, are you aware that all your debt is not considered?  What debt you ask?  The debt that I am referring to is the light bill, water bill, phone bill, grocery bill, cable bill, clothing bill, etc.  And that may be more depending on where you live.

Now the latter statements puts the pre-approval letter into a new prospect doesn’t it?  Don’t get discourage.  Just do your homework.  Buy where you are already comfortable and be patience.  With the present market being a buyer’s market, you will find a home that is in that comfortable range in no time. For instance, if you can enjoy life and drive the car you want, eat out when you want at $800.00 in rent, then look for a home where the mortgage payment with principal, interest, taxes, and homeowner’s insurance is at or near $800.00.

Next, you must determine what type of loan you have an adjustable rate, a fixed rate.  The difference is that the adjustable rate will do what adjust and a lot of time it is not down, but up.  If you choice the adjustable rate, find out what the maximum rate is and determine whether you can afford the adjustment.  The mortgage and your Realtor can show the difference in payment.

The fixed rate is just that fix.  The rate will stay the same for the life of the loan.

Lastly, know what you can handle includes not only the mortgage payment, but the now new responsible of maintenance of the property. Therefore, I recommend having an inspection of the home to make sure you did not bite off more than you want to chew. The home inspection will tell you the condition of the home to include the condition of the roof, the condition of the plumbing, condition of the electric, etc. With the home inspection, you will get a detail report of the condition of the home, and it may include all items that may need deferred maintenance. Deferred maintenance is important because those repairs can go before or after projected time range that the inspector gives, so it is important to be prepared financially. Because all repairs first time home buyer is on you not a landlord.

Do not get me wrong buying a home is a happy and great experience, but it can turn into disaster if you are not prepare, so I hope this helps.

Indiana Property Tax Appeal (Part 2)

Originally posted 2008-12-28 16:10:20. Republished by Blog Post Promoter

To get the forms needed for filing your property tax appeal visit
for Form 130 also called Form 11 CI www.in.gov/icpr/webfile/formsdiv/21513.pdf

For Form 11 RA visit http://www.in.gov/ibtr/files/DavidandPatriciaSullivan.pdf

For Form 113 visit http://www.in.gov/icpr/webfile/formsdiv/46725.pdf

Below is a video for filling out the form if your property is located in Porter or La Porte County:

If you need additional information or need the form, please email Serena at snorbrown@yahoo.com

Related Articles

Evaluation of Property Tax Appeal Findings

Property Tax Appeal Review (Video 1 of Section 1)

Indiana Property Tax Appeal

What is Assessed Value and How Does It Influence My Property Taxes

Outraged Over Property Taxes

Great News the End of High Property Taxes

Investor’s Delight – 3695 Connecticut

This diamond in the rough is what you have been looking for to add to your real estate portfolio.  It does need a little tender loving care, but you will be happy with the results.  Make your appointment today.  The property is located at 3695 Connecticut Gary, IN 46409.

Motivated Seller

Make any reasonable offer

Listed for $17,500

What Does the Pre-approval Mean?

Originally posted 2008-11-29 11:04:02. Republished by Blog Post Promoter

As a buyer, you are excited because you have a pre-approval letter, but what does the letter mean?  The pre-approval letter is determined by looking at your income to debt ratio true enough; however, are you aware that all your debt is not concerned.  What debt you ask?  The light bill, water bill, phone bill, grocery bill, cable bill, clothing bill, etc. and those bills can be more depending on where you live.

Now that puts the pre-approval letter into a new prospect doesn’t it?  Don’t get discourage.  Just do your homework.  Buy where you are alright comfortable and be patience.  With this market being a buyer’s market, you will find a home that is your comfortable range.

Next, you must determine what type of loan you want an adjustable rate or a fixed rate.  The difference is that the adjustable rate will do just that adjust and a lot of time it is not down, but up.  If you choice the adjustable rate, find out what the maximum rate is and determine whether you can afford the adjustment.  The mortgage broker and/or your Realtor can show the difference in payment. 

The fixed rate is just that fix.  The rate will stay the same for the life of the loan.

Now, what can change besides your rate is the taxes and insurance. 

With the taxes, you can head off this change by filing for your homestead and mortgage exemptions.  By the way, these exemptions are only for your primary residence, the one you live in.  You can file for these exemptions within 30 to 45 days of closing that should be long enough for the title company to get the property in your name.

With the insurance, the premium that you pay when you purchased your home may change by renewal of the policy.  Therefore, three months prior to your renewal of the policy call your agent to see what your new premium will be.  Your renewal date will be the anniversary of the day you purchased the home.  If the premium goes up more than $100 dollars start shopping.  Now keep in mind your credit now influences your insurance premium and any claims that you may have filed the previous year.  Your present agent can make some adjustment to your present policy to decrease the premium and it may be worth asking for those adjustments before moving to another company.  The insurance agent can adjust your replacement cost.  What is replacement cost?  Replacement cost is the cost it will take to rebuild your home if it was completely destroyed.  The most that your premium can be adjusted is within 80% of the replacement cost.  For instance, if your replacement cost is $100,000, then the lowest you can adjust your replacement cost is $80,000.  The replacement cost adjustment must be able to pay off your present mortgage, and hopefully enough to build you another home but in most cases it will be enough to start. 

Please consider these facts when you are looking at your pre-approval letter and smiling ear to ear with joy.

The Price We Pay to Watch Television

Wow, we are on the edge of another technology upgrade.  One may be wondering if it is necessary to convert alll television viewing from analog to digital?  I am not sure we have a choose in the matter.  A of June 2009, all television stations will stop transmitting analog signals.  The stations have spend millions and probably received another millions in write offs and/or other incentives form the government to convert over to digital.

I am not sure I welcome this conversion with open arms because I have to buy new equipment to watch television.  The government once again thought that most of us would not appreciate this unneccessary expense, so the government set aside 33.5million coupons with a retail value of $40.00 for this conversion.

It seems to me that this once again a misappropriation of money because 33.5 million times $40.00 is 1.34 billion dollars.  That’s right 1.34 billion dollars, with a “b”, and who knows how much money was spend on the conversion for ever broadcast station in America.  If you know the figure, please comment.

It is all unnecessary, but what can you do when it is already done, but pony up unnecessary money to watch of all things television.

Mortgage Fees Can Affect Your Affordability

Originally posted 2009-01-03 12:24:29. Republished by Blog Post Promoter

When choosing a mortgage company look at the fees you are being charged because that may affect your affordability of the loan at the beginning of the process.   Notice that the fees are different if you live in certain cities.   Below is the fee structure for Fifth Third Bank

 

Standard Fees	Conventional/Jumbo	FHA
 Funding Fee – PA, NJ, NY, MI, OH, IN, KY, WVA, N.KY, DE         Â	 $495.00	 $595.00
Funding Fee – IL, WI, MN, IA, SD, NE                     Â	 $520.00	 $650.00
  Funding Fee – NC, SC, GA, TN, VA, FL, AL, MS         Â	 $495.00	 $595.00
 Funding Fee – TX, MO, KS, AR, LA, CO, ID, OR, WA, NM, NV, WY, UT    *Funding fee is per the subject property’s state       Â	 $525.00	 $625.00
 Re-draw Fee   Â	 $150	 $150
 Rush Closing Request (When able to accommodate less than 48 hours Charlotte Fulfillment Chicago Fulfillment Cincinnati Fulfillment Grand Rapids Fulfillment   Â	 $100.00 $100.00 $100.00 $200.00 $100.00	 $100.00 $100.00 $100.00 $200.00 $100.00
Flood Certification               Â	 $4.00	 $4.00

 

Tax Service Fee is $72.00.  This fee is for the mortgage company to pay your taxes from your escrow account.  The taxes that is paid in your mortgage for the mortgage company to pay on your behalf sits in an interest bearing account until such time as when it is necessary to pay on your behalf.  However, the bank is charging for this when in fact they are getting paid on the money already.

How to Avoid Giving Your Paycheck to the State of Illinois

With work zone death increasing, Illinois is leading the states in incorporating the toughes fine structure for offenders of posted speed in the country. 

The state of Illinois will using photo radar in freeway work zones start in July.  Even one mile per hour over the posted speed limit will get you a $375.00 ticket in the mail. The speed cameras  will be in all work zone areas on major freeways.  If you are caught speeding by these devices will be mailed a $375.00 ticket for the FIRST offense. The SECOND offense will cost $1000.00 and you will receive a 90-Day license suspension.  Drivers will also receive point on their license.  The points will allow insurance
companies to raise Insurance rates.

To read the press release, click on the link below.
For more info: http://www.dot.state.il.us/press/r033005.html

Indiana Can’t Even Get Budgeting Right

Did you know that Indiana ranked 49th out of 50 in a recent evaluation of the state’s budgeting process?  The main reason the state scored so low was due to not having line item veto and not having a requirement to balance the budget.  With the country’s economical vitality hanging in the balance, Indiana has once again made itself a spectacle of bad government.

The commitee that evaluated the state’s budget did not agree with Representative Jeff Espich that “Indiana’s system is open and appears to be leading Indiana in the right direction.”  I do not agree with the Representative, either.

The state by no means is heading in the right direction, with the highest unemployment rate in decades.  By no means is Indiana headed in the right direction.

There is, however, a slow process in place to resolve the unfair and expensive property taxes.  The first measure that the state took was to realize that there was a problem with the way the assessed value was determined.  However, the state did not come to this conclusion on its own.  It took a law suit. 

Ten years ago a new construction property owner filed a law suit claiming that the assessed value was unfairly advantageous to homeowners of older homes due to the lower assessed value.  The courts agreed and ruled that the assessed value will be determined by a fair market value system.  This fair market value system, however, still needs to be added to the outdated Indiana constitution.  Therefore, the residents of Indiana will be voting on adding this system and changing to a flat rate for all assessed properties.  The rates will be one percent for homeowners, two percent for investors, and three percent for business owners. 

The market value system was adopted and began in 2001; however, it took over two years before any muncipality received the much needed funding.    The flat rate system; however, will be voted on 2010 and if approved by the citizens it will take affect in 2011.

Instead for the last property tax collection in 2000, the state ruled that a collection of seventy percent of that year’s bill would cover any short fall for the new unknown tax bill when it was available. 

This proved to be disasterous for many new buyers because the title companies left it up to the sellers and the buyers to settle any shortfalls.

Incidentally, it took over two years before the figures were known.  As a result, I had a client who was unfairly paying property taxes forom a seller who refused to pay the property taxes when the figures was known years later.  The buyer had to sue the seller.

From the latter scenario, you may be able to see why I, nor the media believe that the “state is on the right track.”

Tell me what you think?  Do you think the state is on the “right track?”

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