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Wow that was close!
At the very last minute, Congress passed legislation extending the Mortgage Debt Relief Act for homeowners who do a Short Sale through 2013. When a homeowner sells their home, the IRS won’t treat the debt forgiven by the bank as income, which means they won’t owe taxes on that amount, therefore allowed a seller to short sale their home without immense tax consequences (Shortsaleagentfinder.com). Considering a short sale? Contact Michelle De Leon, MBA of Prudential Foothills Real Estate for more information!
The Mortgage Forgiveness Debt Relief Act of 2007 relieves homeowners from being taxed on the deficiency when they obtain a Loan Modification, Short Sale and even in a Foreclosure. This Tax Act is only good through 2012, which means if you have forgiven mortgage debt after 2012, expect a tax bill. Homeowners who are foreclosed, sell short or modify their loans will be taxed as income for the deficient balance.
Tara-Nicholle Nelson, Broker in San Francisco, CA says, “While the long-term housing outlook is beginning to look up, 2011 is projected to be the peak year for foreclosures during this market cycle. Distressed homeowners who are on the brink of a short sale, loan modification or foreclosure should be aware that normally, any mortgage balance that is wiped out by one of these outcomes is taxed as what the IRS calls Cancellation of Debt Income, or CODI.”
“Under the Mortgage Debt Forgiveness Relief Act of 2007, the IRS is currently not charging income taxes on CODI incurred through a loan mod, short sale or foreclosure on most primary residences through 2012. But right now, banks are taking many months, or even years, to work out mortgages in all of these ways; the average foreclosure in New York state right now occurs only after 22 months of missed mortgage payments. If you foresee any of these outcomes in your future, don’t put things off. Do what you can to get to closure on your distressed home and loan, ASAP, while you won’t have income taxes to add as the insult on top of your significant housing injury.”
The Veterans Affairs (VA) loan limits have been posted for 2011.
For all counties in Arizona, the 2011 limit is the standard $417,000.
Bank of America says:
“Although rates are still near historic lows, they have been headed up… and indications are that those very low home loan rates may be behind us. In fact, there are only a few things that would bring back the lows we saw in early November:
*If the tax cut package doesn’t get passed, it would be bad news for the economy and stock market – but it would help interest rates.
*If the Fed’s recent round of quantitative easing doesn’t meet its mission of creating inflation, boosting stock prices, lowering unemployment and creating consumer demand – bond prices could make some gains as the threat of deflation reemerges.
*If the financial problems in Europe worsen significantly – which would drive investors into the safe haven of the U.S. bond market – it could help bond prices, but probably only modestly.
Realistically, the chances of these events happening are unlikely. In the end, rates may see some brief and fleeting improvements, but many experts believe they will likely continue to creep up over time.”
Pima County Family Housing Resources has new down payment assistance programs to help buyers purchase a home:
1) PNIP HAP NSP-2 offers $20,000 to purchase a vacant foreclosed home in the NSP-2 target area. The purchase price must be 1% below the appraised value. The HQS inspection is not a requirement, but the home must be habitable.
2) The 3.5% up to $5,000 homebuyer assistance program is back. Homebuyers can buy a new or resale home with these funds.
3) The 4.5% up to $6,000 homebuyer assistance program with an MRB loan is still available
The HQS inspection is still required with both of these programs
Looking for a spacious home in Tucson’s Northwest? Stop by my Open House at:
4 Bedrooms, 2 Bathrooms,
Swimming Pool, Bay Window in Living Rm/Dining Rm, Den off Living Rm, Family Rm off Kitchen, Covered Patio, Double Drs to Master. Popular Open Floor Plan with Archway, Niches, High Ceilings & Many Upgrades. Stucco, Tile Roof, Block Wall Fence, Sidewalks, Quiet Area. NOT a Short Sale, Quick Close! Qualifies for FHA 1% Down Program. USDA Money is now available! ~You’ll love this home!
N-Ina/La Cholla, W-Tangerine Rd., N-Dove Mountain Rd., L-Moore St., R-Tortalita Rd., R-Cochie Springs St., L-Fresnal Canyon St. to address.
12854 N Fresnal Canyon Road Marana, AZ 85658
- 4 Bedrooms, 2 Bathrooms, 1928 sq. ft.
- Living Room, Family Room & Den
- Covered Patio & Pool
- High Ceilings, Tile Roof, Stucco
- Built in 2000
- Qualifies for FHA 1% Down Program
~ You’ll love this home!
Michelle De Leon (520) 429-1111
Prudential Foothills Real Estate
7231 E. Speedway
Tucson, AZ 85710