Hurry up and get those taxes done!

With Tax Day (April 15th) only two days away, if you haven’t filed your taxes yet you will want to hurry up and get them done.  The IRS could not only stick you with a failure to file penalty, but you could owe interest on any unpaid taxes.  You can always ask for an extension, but make sure you check with the IRS and/or your accountant to get that done prior to the deadline.  Here is the link for the form for an extension, but it must be completed and submitted before Wednesday.

Lines will always be extremely long at the post office, even though they offer extended hours.  So the IRS always recommends filing electronically.  Most of the computer programs offered allow you to send in your returns this way.  A great benefit to this is that you can receive your refund in half the time via direct deposit to your bank account.  You can split your return deposit into up to three different accounts. The IRS also will acknowledge receipt of your return so there are no worries that it was lost in the mail. 

small_tax20deadline20for20businessFor those of you who owe money to the government, there are many ways you can submit the payment.  You an always send in a check with your return, as long as it’s postmarked by April 15th.  You can also charge a payment with your credit or debit card by phone or online.  You can file online at any time and request a withdrawal on the 15th.  You most likely will be charged a convenience fee to pay by credit card, but you may now be eligible to deduct that fee on next year’s returns.

For those taxpayers that need additional time to pay the government, the IRS now offers an installment plan.  If you owe $25,000 or less in taxes, you can apply for a payment plan electronically which will allow you to pay your balance in manageable, monthly installments.  You will get charged $105 to set up the agreement or $52 if the payments are automatically deducted from your bank account.  Qualified low income households will be charged $43.  Taxpayers are required to pay interest plus a late payment penalty on the unpaid taxes for each month or part of a month after the due date that the tax is not paid.

More IRS reminders can be found on their Web site.  Just remember to claim all of your deductions.  Homeowners can deduct property taxes, mortgage interest, and more.  If you own a rental property, you can deduct any payments that went into maintaining the property.  Make sure you consult a certified accountant for help.

Good luck, and visit me online for more information!

Tips for selling more quickly despite the market

No one can predict what will happen to the housing market in the next year, let alone next week.  Sellers are still dependent upon buyers for determining value, and patience is key as a higher inventory of homes is dropping prices across the country.  Author Peter Miller understands that the market is fluctuating, but despite this, offers some suggestions on what you can do to maximize your profits and seller more quickly.

1. And what I think is the most important: Hire a local Realtor.  Nobody knows the local marketplace like a Realtor who works in it.  When I’m not with clients, I’m out previewing homes and comparing data.  I’m viewing homes on a regular basis to know what’s selling and why and for what prices.  I have access to all homes listed, which makes it better for you in terms of knowing the competition.

2. Going along with that, it’s important for you to visit open houses.  This will help you get a better idea of what your competition is.  Make sure to go see what other houses in your neighborhood look like.  You can determine what features they have that you don’t and vice versa.  openhouse1

3. Update MLS photos.  I cannot tell you how many times I go to look at photos of new listings to see a snow covered driveway in July or even Christmas decorations.  Nothing lets the buyer know how long the home has been sitting on the market unsold like this.  With digital cameras commonplace these days, posting newer photos should be a piece of cake.  Make sure your Realtor posts the most updated (and clean) photos of your home.

4. Know your terms.  It might be easier to agree to pay closing costs for a buyer than to lower your price by $10,000.  It could be a lot cheaper, too!  Consider all negotiating points when an offer comes in.  It’s also important to consider EVERY offer, and not just decline a low-ball offer.  Everything is negotiable, and it might be worth it to sell your home now than have it sit on the market for an additional 10 months that you need to pay a mortgage for.

5. Know the marketing plan your Realtor has set in place.  And make sure they stick to it.  If they’re not familiar with online marketing, they might not be the right agent for you.  These days, buyers are looking online more and more before they physically visit homes.  Ask your Realtor to keep you updated about where your property is being advertised.  You might even ask them for pieces that you can hang in your employee lunchroom or at your child’s school.

These are just a few steps that might help you sell quicker.  View the rest here.

For a look at my marketing plan and help selling your home, please visit me online.

Home builders merger creates largest company

imagesIn a recently announced merger, Pulte Homes has agreed to acquire Centex Corporation, creating the largest homebuilder in the country.  The two companies had a combined 39,000 closings last year, and are hoping to keep those numbers up amidst the housing downturn.

Pulte’s President and CEO Richard J. Dugas, Jr. will remain president, CEO, and chairman.  Centex’s CEO Timothy Eller will become vice chairman of the new company that will use Pulte’s name.  They will be based out of Bloomfield Hills, MI where Pulte currently is based. 

Dugas made a written statement saying, “Combining these two industry leaders with proud legacies into one company puts us in an excellent position to navigate through the current housing downturn, poised to accelerate our return to profitability.”

Each company has stated they had about $1.7 billion in cash so combined they’ll have more than $3.4 billion in liquid funds.  Both CEOs stated that merging together would be the best way to survive the downturn in the housing market.  “As the industry prepares for further consolidation, we believe that acting first gives us a competitive advantage,” said Dugas.

After the merger, stockholders in Pulte will own 68% of the combined company while stockholders in Centex will own 32%.  Early this morning, shares of Centex stock were up to $9.24 (+21%), while Pulte stock was down to $9.88 (-8%).

One analyst said that Centex’s strength was the first-time buyer market which will be a new advantage for Pulte, who formally excelled in current home buyers looking for move-up opportunities.  And hopefully the current stimulus package by the Obama administration will increase the amount of closings by first-time buyers.

For help with purchasing your new construction home, please visit me online.

If you need a loan from your IRA…

penniesWith so many homeowners struggling to make mortgage payments, people are turning to other sources to “borrow” money.  You might be speaking with your lender about modifying your loan.  You could be borrowing from a friend or family member.  What if you have money saved up in your retirement account?  Is it okay to take a loan against your IRA? 

Bankrate.com offers an interesting article on when it’s okay to borrow against your IRA.  The IRS will not only tax any amount you pull out before you reach age 59 1/2, but they will also charge you a 10% penalty.  The two biggest penalty-free withdrawls are to purchase a first home (great news for a Realtor) or to help pay for school.

The IRS considers a first-time homebuyer someone who hasn’t owned a principal residence in the past two years. So even if you’ve bought a home before, but you’ve been renting for a while, or have been out of the country on business, you could qualify for this exception.  The IRS allows a penalty-free withdrawal from your IRA for up to $10,000 for a single person, and up to $20,000 for a married couple if both are first-time buyers.  One stipulation is that the money is used within 120 days, so make sure to time it against your closing date.  Also, this is only for a traditional IRA.  For Roth IRAs, you can take the $10,ooo if you’ve had the IRA for at least five years.

If you go to an IRS-approved school, you can also take out money without a penalty.  This is any college, university, vocational school or other postsecondary facility that meets federal student aid program requirements. The school can be public, private or nonprofit as long as it is accredited.  The money can be used for schooling for yourself, spouse, children, or grandchildren.  Not only can the money be used to cover tuition, but it can also be used for any supplies, books, or room and board if you’re enrolled more than half time.

Members of the military also qualify for these penalty-free loans if they meet the following requirements:
– You were ordered or called to active duty after September 11, 2001
– You were ordered or called to active duty for a period of more than 179 days or for an indefinite period because you are a member of a reserve unit
– The distribution is from an IRA or from an elective-deferral plan, such as a 401(k) or 403(b) plan or a similar arrangement

You can take the money out either before you’re called to duty or after your active duty ends.

For more questions about what qualifies, please be sure to visit me online.

Help for those struggling with their mortgage

mortgagehelpFinancial expert Suze Orman appeared on Oprah Winfrey’s talk show yesterday and offered advice to those struggling through this recession.  I want to talk mostly about those that need help with their mortgage, but I will also write about her other suggestions to survive during this recession.

If you’re having trouble paying your mortgage, your first step is to find out if your loan is backed by Fannie Mae or Freddie Mac.  Currently, these lenders are offering loan modification programs and homeowner assistance to those having trouble paying.  Here is their contact information:

For Fannie Mae:
800-7FANNIE (8 a.m. to 8 p.m. EST)
www.fanniemae.com/homeaffordable

For Freddie Mac:
800-FREDDIE (8 a.m. to 8 p.m. EST)
www.freddiemac.com/avoidforeclosure

The government has also created a Web site to determine if you are eligible for assistance.  You can take their self-assessment tool to find out. 

Suze’s other helpful tips include to live on half of your income.  If you’re a dual-earner household, she suggests banking one contributor’s salary and using the rest to live off of.  If you’re a single-earner household, cut your income in half.  If you suddenly find yourself unemployed, your income will be down to that amount anyway, so now is the best time to figure out where and how you can cut your spending.  She offers this worksheet to help you determine how you can cut your spending.

She’s also urging people to save their cash. She recommends only paying the minimum on your credit card each month.  As soon as you pay off your balance you could find your credit card closed and then you’ll really be in trouble.  Use extra money you have to put away for an emergency fund.  And do your best to pay for things in cash or with a debit card.  Try to avoid using your credit card since interest rates are skyrocketing.

20090311-tows-suze-orman-step-3-homes-290x218

Take advantage of the stimulus package.  The government is still offering an $8,000 tax incentive for first time buyers.  That means if you qualify to purchase a home under this program that if you owe $10,000 in taxes, you’ll only pay $2,000.  It’s an $8,000 tax credit!  The government is also offering tax credits to those in the market to purchase a new car.  Click here to find out if you qualify.

For more questions on the stimulus package, to find out if you’re eligible for mortgage loan modification, or questions about the first time buyer tax incentive, please visit me online.

Creative attempts to sell condos

In an attempt to unload 100 empty condos in the Vetro building in Chicago, Developer Thomas Roszak decided to auction them off.  He was able to sell 45 of the 100 remaining units in his tower, located at 611 S. Wells Street.

auction_gavel

Out of 232 units in the building, the 45 that were sold went for about $258/square foot.  That is 73% of the pre-auction asking price of $353/square foot.  Winning bids were anywhere from $145,000 to $429,000.

Roszak said the housing market was making it hard for sellers to determine a fair asking price, and that this auction helped him learn what buyers were willing to pay.  Both Roszak and his construction lender, Corus Bank, approved of the winning bids.

Last year, about $59 billion in real estate was sold at auction, according to the National Auctioneers Association in Overland Park, Kan., up about 23 percent from 2004. “My thought is that this is going to be something that is going to be used more and more,” said Roszak.

Paul Rogers is the senior vice president and managing broker of Inland Real Estate Auctions Inc.  He is planning two condo auctions in the Chicago area to be held in the next couple of months.  He thinks the slow housing market will boost auctions by 50% in the area over the next year.  The slow housing market and increase in inventory are his two big reasons for coming up with that number.  “It eliminates the carrying cost of owning unsold real estate,” Rogers said. “Sometimes it is a last resort. It’s not a conventional approach for selling real estate.”

Lenders on other slow-moving downtown condo projects also are considering forcing developers to hold auctions, said Garry Benson, president and CEO of Garrison, which has formed an alliance with Boston-based Accelerated for future Midwest sales efforts.  “The question will be, what is the real depth of the marketplace, and will the next auction produce the same results?” Mr. Benson said.

More details of this auction and the future of auctions to sell real estate can be found in this article and this article.

For questions on how an auction might help you sell your home, please visit me online.