Home Buyer Tax Credit Deadline Looms – It’s Already Close for Short Sales

The Home Buyer Tax Credit that went into place at the end of last year will expire on April 30 in its present form. Homes and condos must be under contract by that date and close by June 30 to be eligible for the credit. See Home Buyers Tax Credit for more details. The tax credit can be up to $8,000.

The important point for buyers looking to take advantage of short sale opportunities is that time is running out. I’ve had many short sales that were not processed by lenders in the time left between now and the April 3oth deadline. For buyers of Daytona foreclosures and properties that are not in distress you will have a little more time, but with inspections and the length of the closing process, it’s wise not to delay too long.

Short Sale Buyers Strategy

Our recommendation for short sale buyers who want to take advantage of the tax credit in their purchase of Daytona Beach Homes is pretty simple – submit offers on multiple properties and schedule the closing well before June 30th.

This recommendation protects you both from losing the tax credit by not being under contract and insuring the closing against “surprises” from lenders and closing agents.

Submitting multiple offers will give you the best chance of taking advantage of the credit and getting a property you want. How many? Well, it’s a tough call, but you have a good chance with five to six. There’s no guarantee that any of them would be approved in time, but with five or six, you will probably be successful. Note that you must have a binding contract where both parties have signed before April 30th. Just making an offer is not enough. Make sure your real estate agent is an expert in short sales to protect yourself further (I’m certified and have closed dozens of short sales.)

Scheduling the closing a couple of weeks before the June 30th deadline will prevent requests for additional information from lenders and closing agents derailing the deal. I’ve had a lot of closings delayed, so please take this precaution to prevent losing the tax credit.

Will The Home Buyers Tax Credit Be Extended?

We don’t know whether the homes buyers tax credit will be extended for a second time. The Obama administration has been declaring that we are on the way to economic recovery. The Federal Reserve will stop buying Mortgage Backed Securities in March. Many are seeing that as a sign the administration is backing off big support for the real estate markets. If the same thinking applies to the tax credit, then it won’t be extended. However, the budget submitted by President Obama does contain additional tax credits for home buyers. Congress could remove it from the budget or it could be less; we don’t know.

There are tremendous opportunities available for buyers in the Daytona real estate market. For more information or to receive a list of properties that meet your criteria, please contact me at 386-566-7503. I’m a certified short sale specialist and have many short sale transactions successfully completed. Put me to work for you.

What You Must Know If You Are Planning to Buy A Home Now

55% of Florida home sales in September were REO (real estate owned) and short sales according to Lender Processing Services (LPS). As a home buyer, the Daytona Beach condos and homes you will be searching for and seeing will be in financial distress over 50% of the time.

There is even a greater chance that the home or condo you make an offer on will be in foreclosure or a short sale because this is where the best prices will be found. That means to be well prepared, you need to know more about Daytona Beach short sales and foreclosures. More information can be found on our sites through the following links:

Daytona Beach REO Properties
Includes and explanation on REO properties and how you can benefit

Daytona Beach Shore Sales
This page will give you links to videos and other articles on short sales for both buyers and sellers.

There are different perspectives on short sales and foreclosures. An article from Public Radio -Home-selling’s short sale headaches gives a perspective from the sellers side of the problem, but also talks about making offers on short sales properties. It’s worth a read.

The gist of the article from our view is that if you are in the market to buy a home or condo, you need two things:

1. As much knowledge as you can get about the process,
2. Experienced guidance in selling or buying distressed properties.

Check around our site or search on REO, short sales, and distressed property through your favorite search engine to learn more. As far as guidance is concerned, please make sure you real estate agent has extensive actual experience in short sales and foreclosures. In this market, it is critical. In Daytona Beach, Ormond Beach, Port Orange, Palm Coast and the surrounding communities, I can help. I’ve closed over 22 deals this year and most of those have been short sales and foreclosures. I know the process, both from the listing and selling side. Call me with your questions at 386-566-7503.

Florida Leads The Country in Foreclosures

The Sun Sentinel reports in a recent article – Florida leads the nation in foreclosures:

One out of four Florida home mortgages is in foreclosure or delinquent.The third quarter report from the Mortgage Bankers Association
brings almost too much precision to the picture of the foreclosure
crisis.

Nationwide, more than 4 million home mortgage borrowers are behind on their payments.

In Florida, we have 441,440 home loans in foreclosure and 422,036 that are delinquent.

The Florida foreclosure rate is the highest in the nation. And the
combination of the foreclosure and delinquency rate is also the highest.

A total of 12.18 percent of home mortgages in Florida are delinquent and 12.74 are in foreclosure.

Daytona Beach Homes in Foreclosure

In October, foreclosures in Volusia County were up 3% while the rest of the nation saw a small month to month decline. We did see a 4% decline for the state from last October. 1500 Volusia County homes are in foreclosure, but many more are in the foreclosure process.

This rate of foreclosures will continue to keep inventories high making for real pricing opportunities for buyers. Prices as reported as an average are nearly useless in this market. It takes work and patience to find the right property at the right price and buyers who are willing to go through the process can get tremendous bargains.

Sellers who are not in financial distress with a property must decide whether to hold the property or sell and cut their losses. That’s a personal decision based upon individual financial situations. However, keep in mind that you are competing against short sales and foreclosures and must price aggressively to sell in this market.

This situation will not be going away for a few years. See my article from a few days ago – Foreclosure and Delinquency Rates Rise for why. If your a buyer, the best approach you can make is to decide what you’re looking for and your timing because even though there are plenty of properties on the market, the prime properties are competitive. For instance, oceanfront condos in Daytona Beach Shores that are competitively priced have gone under contract almost immediately after listing. They are super-desirable and require buyers who know what they want and are ready to pull the trigger when the property comes on the market.

Give me a call at 386-566-7503 to discuss your options  or just to ask questions about the market.