by Jim Wasserman – Sacramento Bee, 5/20/2010 (Legal)

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High numbers of pending home sales suggest California’s new $10,000 tax credit for first-time homebuyers will run out as soon as next month, officials said Monday.

Nearly 2,500 buyers have already staked claims to $13.3 million in tax credits since the program’s start May 1, according to estimates by the state Franchise Tax Board. That includes 2,040 applications last week. The previous week an estimated 430 buyers applied for shares of a $100 million statewide allocation.

“People respond to financial incentives,” said Leslie Appleton-Young, chief economist for the California Association of Realtors, on Monday. “Absolutely, it’s going fast.”

The pace suggests that initial estimates of the credit lasting just “six to eight weeks,” according to tax board spokeswoman Brenda Voet, are accurate. Pending sales of existing homes – those between an accepted offer and close of escrow statewide – are running 20 percent ahead of last year at this time, said Appleton-Young. If last year’s history holds true, nearly half are first-time buyers sure to apply for tax credits within days of closing escrow.

The FTB couldn’t provide application totals received to date from the capital region.

Voet said a second $100 million allocation for buyers of new unoccupied homes will last longer. But even that “could take as little as six months” to allocate, she said Monday. The FTB had no estimates for those applications.

Late last week, the tax agency began warning first-time buyers that it could take up to an hour to connect to its fax machines due to “the high volume of faxes we are receiving.”

The state’s popular new housing stimulus follows a similar $100 million allocation last year for buyers of new, unoccupied homes. Nearly 11,000 buyers claimed those state credits within four months, trimming a massive glut of vacant new houses.

Some first-time buyers delayed scheduled April escrow closings until May to qualify.

“We had Realtors in the field say that was happening,” said Appleton-Young.

That might be a small, partial explanation for a fall in closed escrows from March to April, said Bob Bronswick, president and chief operating officer of Coldwell Banker Residential Brokerage in Sacramento and Lake Tahoe. He said some buyers managed to snag both the state credit and an $8,000 first-time federal credit that expired April 30.

The FTB said on its website that estimates of applications are tentative and may be overstated given last year’s history of duplicate or invalid applications.

The state projects that 17,500 first-time homebuyers will receive tax breaks averaging about $5,700 apiece over three years. An additional 14,000 buyers of new homes will get three-year tax breaks totaling about $7,000 each

State lawmakers and Gov. Arnold Schwarzenegger approved the tax credits in March to boost home sales and help stimulate a lagging construction economy. Homebuilders have expressed hopes it will revive an industry that’s seen construction fall to post-World War II lows.

–Call The Sacramento Bee’s Jim Wasserman, (916) 321-1102 or email him at jwasserman@sacbee.com. Read his blog on real estate, Home Front, at www.sacbee.com/blogs.

California Tax Credit  Program

New Home Buyers or First Time Home Buyers may be able to take advantage of a California tax credit for homes purchased in 2010.   Hurry – Tax Credits will be allocated on a first-come, first served basis!

• Available for taxpayers who purchase a qualified principal residence on or after May 1, 2010 and before January 1, 2011.
• Taxpayers MAY APPLY for the tax credits if they have entered into a contract BEFORE May 1, 2010, as long as escrow closes on or after May 1, 2010
• The tax credits are limited to the lesser of 5% of the purchase price or $10,000.00
• Tax payers must apply the total tax credit in equal parts over 3 successive tax years beginning with the tax year the home was purchased
• Application and settlement statement must be received with 2 weeks (14 calendar days) after the close of escrow.
• More FTB Info…
• Download FTB Publication 3528 New Home Credit

Information courtesy of WJBradley Company, Direct Mortgage Banker - (559) 658-7611

(Always check with your Tax Professional before applying for credit)

Learn How To Take advantage of the Program
Contact one of Our Agents Today!

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Federal Program

Although the Extended Home Buyer Tax Credit expired on April 30, 2010, home buyers who signed a written, binding contract by that date and close before July 1, 2010 may still be able to claim the credit. Read Full Article…

A Crane Valley Dam Update meeting was held at The Pines Resort on Wednesday evening, April 7, 2010.   Representatives from PG&E, The U.S. Forest Service, and the Federal Energy Regulatory Commission were on hand to provide information on progress on the Crane Valley Dam Retrofit Project.

The permitting process is still proceeding through the several agencies involved.  Submitting the applications concurrently has kept this process moving more quickly than might otherwise be expected.  The hope is to have all of the agencies signed off on their permits by mid to late summer of this year.  The work on preparing the quarry for use will then begin in September. 

The quarry is located off Road 222 within a mile of the dam.  The site is about 8 acres, and 30 acres will be cleared for roadway purposes and for storage of material.  Timber removal is the first step.   Approximately 2300 trees greater than 10″ in diameter will need to be taken down to obtain the rock below.  After the project is completed new trees will be planted to replace those lost to the project.   Approximately 253,000 cubic yards of material will be removed, transported to the work site, and placed on either side and on top of the existing dam for reinforcement. 

Road 222 will stay open during the project, but will be subject to traffic control while material is hauled to the dam. 

It is anticipated that the retrofit project will take 19 months to complete.  Water levels are projected to be at the same level as 2009 for the summers of 2010 and 2011, with slightly lower than normal levels in the winter period of 2010-2011.  Work will proceed as quickly as possible Monday through Friday, five days per week at this point.  Blasting at the quarry will be performed one day per week only, with plenty of notice to occupants of homes nearby.  The completion date is scheduled for February 2012. 

Please feel free to keep checking our site for further updates as they become available.

Here’s some useful info on Short Sale Basics:

WHAT IS A SHORT SALE?

A short sale is a real property sales transaction wherein the seller’s mortgage lender agrees to accept a loan payoff of less than what is owed. Your real estate agent may know which properties listed for sale are short sales, using resources such as multiple listing services and property profiles. If you make an offer on such a property, and your offer price is less than what the seller needs to pay off existing loans and other obligations secured by that property, the seller may accept your offer, but also require that his or her lender approves the sales transaction.

The seller involved in a short sale may try to convince the existing lenders to take a payoff of less than what may be rightfully owed them. Lenders may be unenthusiastic about this request and may carefully evaluate the overall situation.

STEP ONE

With the help of your real estate agent, make your offer to purchase. negotiate any details, and get your offer accepted by the seller. Buyers involved in short sales may need patience as these transactions may take more time to process compared to other sales transactions. Short timeframes may be difficult to accomplish due to the lender’s scrutiny of the situation. Be prepared to show that you are pre-approved and therefore qualified to get a new loan on the property if needed.

STEP TWO

Your accepted offer is generally sent from the seller to the lender for consideration. The seller’s agent may help the seller forward to the lender documentation of hardship, income, assets, loan amounts, and the current market value of the property. Additionally, a short sale lender typically requires a breakdown of the estimated costs to complete the sales transaction, including anticipated sales proceeds if any. The lender may take several weeks to decide whether to approve a short sale, according to the lender’s size, location, and staffing. It may be useful to remember:

able to go forward to complete a sale to you.

Without the lenders’ approval to reduce the loan amount, the seller may not be able to go forward and complete and sale for you

Lenders are generally not obligated to reduce their loan balances or to make any concessions to the seller or you.

Lenders may choose foreclosure as an alternative process if they can recoup more money than agreeing to a short sale.

Your real estate agent may provide you with a Short Sale Addendum published by the CALIFORNIA ASSOCIATION OF REALTORS® (CAR). This Short Sale Addendum, if incorporated in your purchase agreement, spells out your time frames and other rights. Until the lender gives the seller written approval of the sales transaction, you may wish to hold off spending money on inspections, reports, and an appraisal. In a short sale contract, the seller’s performance Is generally contingent upon the short sale lender’s approval.

STEP THREE

Once the lender approves your sales transaction , the escrow timeframe may begin. You may want to check with your real estate agent to see if the seller submits other offers to the short sale lender that may be better than yours. This may be a difficult situation. You may be the initial buyer with the seller’s acceptance of your offer, but the short sale lender may ultimately refuse your short sale transaction, and opt for a competing offer that comes in. The lender’s rationale is likely to be to minimize its losses, and there may be tax and other benefits for the seller as well.

You may be able to improve your position by making your initial offer as strong as you can to encourage the short sale lender to approve your purchase transaction.

CONCLUSION

Although there are obstacles to purchasing a short sale, this type of transaction may also offer an excellent opportunity to find your ideal home at an extraordinary price. Some keys to success are having the time and persistence and a good real estate agent to guide you through the process. Good luck!

SPECIAL NOTE TO INVESTMENT BUYERS

Special handling may be required when you buy investment property of 1-to-4 residential units occupied by the seller as his or her principal residence. and an outstanding Notice of Default is recorded against the property. Under these circumstances, you may be required to comply with California’s Home Equity Sales Contracts Law. beginning at section 1695 of the California Civil Code. The purpose of this law is to protect homeowners in foreclosure from unscrupulous people. Under this law, the sales contract must, among other things, provide the seller with the right to cancel the agreement within the statutory period. The law also requires a buyers’ representative to provide a declaration and proof of a sales license with the Department of Real Estate.

Question: What is a REALTOR®?

Answer: The term REALTOR® is a registered membership mark that identifies a real estate agent who is also a member of the NATIONAL ASSOCIATON OF REALTORS® (NAR). REALTORS® are real estate professionals who, among other things, voluntarily subscribe to NAR’s strict Code of Ethics to protect and promote the interests of their clients.

Question: Why would a lender agree to accept a short sale rather than foreclose?

Answer: Lenders have plenty of reasons to accept short sales.

If the lender takes back the property through a foreclosure sale, the lender then becomes responsible for property taxes, maintenance, utilities, Homeowners’ Association dues, and possible eviction of the previous homeowner and vandalism of the property.

The time line for the foreclosure process may be another deterrent for lenders, as it usually takes a minimum of about 4 months after the homeowner starts missing payments and the lender records a notice of default.

Even after the lender forecloses the lender may be face with selling the property in a saturated market and incurring additional costs to sell the property.

With these issues, lenders may give serious consideration to short sale requests involving financially qualified buyers.

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Your Bass Lake Realty Team

PUBLIC NOTICE:
UPCOMING PUBLIC MEETING
April 7, 2010

You are invited to attend a Community meeting to hear an update of the proposed construction project, time line, and permitting status.

The meeting details are as follows:
April 7, 2010
6:00 to 8:00 pm
The Pines Resort, Lakeview Room
54432 Road 432 Bass Lake CA 93604

In addition to the project update, the USFS will provide an overview of their recently issued Notice of Project for the proposed Wishon Quarry Project and Special Use Authorization associated with the Seismic Retrofit of PG&E’s Crane Valley Dam Seismic Retrofit Project.

Please visit www.cranevalleydam.com for information on the current status of the Crane Valley Dam Retrofit project.

Project Update Meeting

When:
Wednesday, April 7, 2010
6:00pm – 8:00pm

Where:
The Pines Resort,
Lakeview Room
54432 Road 432
Bass Lake, CA 93604
PUBLIC NOTICE:
Activity at Crane Valley Dam
Starting March 16, 2010

Bass Lake Area Residents:

Beginning on 16 March 2010, PG&E will be conducting a series of hydrogeological investigations at the toe of the Crane Valley Dam to collect data to support the construction activities necessary to upgrade the Dam later in the year.

It is anticipated that these investigations will be completed within 3 to 4 weeks, subject to weather conditions. The activities planned as part of these investigations will not affect traffic on Road 222. Noise impacts will be minimal and hours of operation consistent with daytime hours.

The parking lot located west of the Dam will be used for staff parking and equipment staging. The Dam road will remain open at all times.

Please visit www.cranevalleydam.com for more information on the current status of the Crane Valley Dam Retrofit project.