Around St. Charles County

• Saturday May 2, Garden Tour and Plant Sale: 9 a.m. to noon, Saint Charles County Master Gardeners, University of Missouri Extension Center, 260 Brown Road, Saint Peters, Free
• Friday, May 8, American Cancer Society Relay For Life St. Charles: 6 p.m.-6 a.m., St. Charles West High School Saturday, May 16 and Sunday, May 17, 2009
• Saturday, May 9, St. Charles County Spring Garage Sale: Family Area parking lot, 8:00 am - noon, $5 per car
• Saturday, May 9, Lewis and Clark Heritage Days, Frontier Park, 9:30 a.m.-5 p.m. Saturday/9 a.m.-4 p.m. Sunday, Lewis and Clark Louisiana Purchase encampment reenactment, Crafts, food, museum tours, period music, children’s games, Fife and Drum Corps parade, Free
• Saturday, May 16, Charity Auction begins at 9 am, Harvest Ridge Elementary School Parking lot - 15 year anniversary Garage Sale of The Woodlands, Whispering Ridge, Heatherbrook, and Nantucket Place neighborhoods
  
• Saturday, May 16, Great River Rendezvous, 10 a.m.-3 p.m., Canoe and kayak race on the Mississippi River, Begins in Grafton and ends at Riverlands Migratory Bird Sanctuary, West Alton, Small registration fee donated to the Treehouse Wildlife Center of Madison County
• Saturday, May 16-Sunday, June 7, Greater St. Louis Renaissance Faire: Saturdays, Sundays and Memorial Day 10:00 am - 6:00 pm, Rotary Park, 2577 W. Meyer Rd., Foristell, Adults-$12; seniors and students, $9; children $6
• Wednesday, May 20, 2009 thru September 16, Music on Main: 5:30 p.m.-7:30 p.m., Food, drink and live music, Free
• Saturday, May 30, Helmet Safety Check for Kids: 10 a.m.-1 p.m., Children’s Hospital professionals, St. Charles City-County Library District, Middendorf-Kredell Library, Free
  

Going Green Clinches The Sale

Green is the hot color right now and should be your color too when you sell or buy a home. Becoming attuned to the current eco-movement will make a huge difference. As a seller, you will boost the value of your home with eco-friendly improvements and give your real estate agent more features to highlight that will set your home apart from the rest.

Buyers are much smarter about their home purchases and want lasting value for the money; an energy efficient system that saves on utilities; and a clean, healthy place to live. Given the current real market, a buyer has the upper advantage and green may very well clinch the sale.

Here are some smart eco-improvements that will attract buyers and sell your house faster.

Breathe Easy
Applying a fresh coat of paint is a standard way of freshening up a home, but you really don’t want that “fresh paint” smell. To make it more comfortable and physically healthy for potential buyers, use paint low in volatile organic compounds (VOCs). This paint is readily available and comes in a wide array of colors.

The Hogs In The Kitchen
Two rooms attract the most attention from buyers–the kitchen and the bathroom. Here’s where you can really shine and show buyers you care about their utility bills. Upgrade old appliances with new Energy Star certified models. While this may seem expensive on the front end, the replacements will more than pay for themselves on the back end and increase traffic.

Don’t Take It For Granited
While we’re in the kitchen, take a look at those countertops. But here’s the deal; don’t automatically assume that granite is the way to go for replacement. Granite countertops may still impress some buyers, but true trendsetters will be on the lookout for kitchens that incorporate some of the hottest new materials. So, what about paper? That’s right, paper. Compressed post-recycled paper sealed with resin makes an extremely durable countertop. It’s less expensive than granite–which is not a renewable resource–and has a warm, sleek feel. Maintenance is low too. A yearly application of mineral oil will keep the countertop looking fresh and new.

Drips Are Out
Leaky faucets, showerheads and old toilets are not selling points. Now’s the time to install low-flow faucet aerators and showerheads. Did you know that showers account for 22% of the individual water use in North America? That racks up really big water and utility bills and rates will continue to rise. Take a look at that toilet too. It’s the biggest water user in the house. By installing a low water usage unit, you can save around 2,000 gallons of water a year.

It Makes Scents
Potential home buyers get a feel for a property as soon as they arrive. To give your visitors a preview of what’s inside, arrange fresh plants new the front door. Especially effective are scented geraniums and herbs that offer an aromatic experience. To spruce up your landscaping, support your state and choose native Missouri plants that grow well in local soil and weather conditions. Inside, remove any chemical room fresheners and display herbs, especially in the kitchen.

Flaunt It
When you go green to sell your home, make sure that potential buyers know about your efforts. Discrete signs here and there, noting low VOC paint, Energy Star appliances, low water usage products and native plants show that you care about your environment and that of the new owner.

For sellers who use eco-friendly techniques, your property has an edge on the competition. Take advantage of these smart tips to be green and earn more green!

DAVE RAMSEY'S TOWN HALL MEETING A MESSAGE OF HOPE!

I just finished listening to Dave Ramsey, as did one million other listeners to a message that he entitled " A Message of Hope". It was wonderful to hear a voice of reason in the these days of media hysteria that do little more that create FEAR in most Americans. Ramsey reminded listeners that FEAR is False Evidence Appearing Real and that God didn't give us a spirit of fear. He went on to compare the past two recessions with the present economy and noted that unemployment and interest rates were much higher then than now. David reassured the audience that ,yes, foreclosures are up but that 60% of the foreclosures are in 5 states and that real estate is local. These are the exact words that our office and the local Realtor Association have been tirelessly touting all year! Ramsey reminded listeners that interest rates are at record lows and home prices have never been lower and that there has never been a better time to buy. THANK YOU DAVE RAMSEY!

SCHNEIDER Real Estate Co-Owner and Public Relations chairman for the St Charles Association of Realtors, Merle Schneider, has tirelessly been trying to get the message out to anyone who will listen in a power point presentation "Market Crashing or Window of Opportunity". I'm thrilled that a million plus people tuned in to this Town Hall Meeting and I personally thank Dave Ramsey for believing in America, Capitalism and Main Stream America! Ramsey believes that it will be Real Estate that will drive the economy back up and encourages everyone not to panic and quit listening to all the negative reporting of doom and gloom.

With Affordability Up, Home Buyers Return to the Market

RISMEDIA, April 11, 2009-Thanks to record low mortgage rates and declining home prices, 55 million families - or half of all U.S. households - can afford today’s $200,000 median-priced new home, according to figures released by the National Association of Home Builders (NAHB). “That’s an increase of 17 million households from conditions just two years ago and the best housing affordability number we have seen in years,” said NAHB Chairman Joe Robson, a home builder from Tulsa, Okla. “We are now seeing the first signs that buyers are returning to the marketplace.”

Based on data from the U.S. Census Bureau comparing home prices, mortgage rates and minimum income needed to purchase a median-priced home in February 2007 and February 2009, a typical family today can purchase a house with $20,000 less in household income and save nearly $500 per month on their principal, interest, taxes and insurance. The number of households that can afford to purchase a home today is 55.4 million, compared with 38.4 million two years ago, according to figures compiled by NAHB.

“With affordability up dramatically, reports from our builders in the field indicate that foot traffic in new homes is on the rise and consumer interest is increasing with each passing day. These are encouraging signs that the housing market may be finally reaching a bottom,” said Robson.

Entering the crucial spring home buying season, there are other signs that buyers are starting to return to the market.

Single-family permits were up 11% in February 2009, new and existing home sales also posted gains and the huge inventory backlog is being slowly whittled down. In a survey for Century 21 Real Estate last month among prospective first-time home buyers who indicated they were likely to purchase a home in the next two years, a majority - 78% - said that now is a good time to buy a home. Of those responding to the online poll, 68% said that now is a better time to buy than six months ago.

Another sign that consumers are considering jumping back into the housing market is the growing interest in the $8,000 first-time home buyer tax credit included in the recently enacted economic stimulus package. During February and March 2009, 1.5 million visitors logged on to NAHB’s consumer website, www.federalhousingtaxcredit.com, to learn more about the tax credit. Further, a new survey commissioned by Move, Inc. found that nearly 20% of those who plan to purchase a home this year are doing so to take advantage of the tax credit, which expires at the end of November.

“With home values in many markets at the lowest level since 2003, an $8,000 tax credit available to first-time home buyers, fixed-rate mortgages under 5%, and an outstanding selection of homes to choose from, buyers are starting to recognize that this has the makings for a one-time opportunity to break into the market,” said Robson.

Housing is a critical component of the U.S. economy, accounting for about 15 cents of every dollar spent in this country, so any upturn in the housing market should be viewed as good news for the overall economy, said Robson.

Construction of an additional 500,000 single-family homes - the difference between today’s anemic construction rate and one that would move closer to meeting the underlying demand for housing - would generate 734,000 jobs and $35 billion in wages in the construction industry and another 790,000 jobs and $37.7 billion wages in manufacturing, trade, and service sector jobs, he noted.

Additionally, another half-million housing starts would bolster the tax base for government, generating $45 billion in federal, state and local tax revenues. And the benefits go well beyond the completion of each home. Within the first year after buying a home, those half million households will spend about $2.5 billion more on appliances, furnishings and property alterations.

“Clearly, housing will be central to any economic recovery we experience in the months ahead,” said Robson.

Contact me for St. Charles Real Estate information.

(Source RSIMedia April 11, 2009)

6 Landscaping Tricks That Wow Buyers

In today's market, sellers have to work harder to persuade buyers that their property is worth the bite.

Landscape designer Michael Glassman has cooked up a recipe for guaranteed curb appeal.

1. Add splashes of color. With every changing season, a landscape should provide a new display of colors, textures, and fragrances. "It’s best to use one or two and repeat them," Glassman says. Example: white iceberg roses that bloom in spring, summer, and fall as a backdrop; in front, a contrasting punch of purple salvia or lavender that will flower at the same time; and as an accent, a crape myrtle tree that provides changing leaf colors in fall and interesting branches come winter.

2. Size trees and shrubs to scale. These should be planted in the right scale for the house so that they don’t block windows, doors, and other architectural features on the home’s facade. A large two-story house can handle a redwood, Chinese pistache, sycamore, or scarlet oak, but a one-story cottage is better paired with a flowering cherry, crabapple, or eastern redbud. Too many trees cast too much shadow and cause potential buyers to worry about maintenance and costs.

3. Maintain a perfect lawn. A velvety green lawn demonstrates tender loving care, so be sure sellers’ homes don’t have brown spots. Some rocks, pebbles, boulders, drought-tolerant plants, and ornamental grasses will generate more kudos, especially in drought areas.

4. Light up the outside. Good illumination allows buyers to see a home at night and adds drama. Sellers should use low-voltage lamps to highlight branches of specimen trees, a front door, walk, and corners of the house. But less is better. The yard shouldn’t resemble an airport runway.

5. Let them hear the water. The sound of water appeals to buyers, and you shouldn’t just reserve this for your backyard. A small fountain accented with rocks provides a pleasant gurgling sound, blocks street noise, and is affordable.

6. Use decorative architectural elements. A new mailbox, planted window boxes, and a low fence wrapped in potato vines add cachet, particularly during winter months when fewer plants blossom. Colors should complement the landscape and home. Just don’t overdo it: Too much can seem like kitschy lawn ornaments.

Source: Michael Glassman, landscape designer, Michael Glassman and Associates, Sacramento, Calif., www.michaelglassman.com

Survey: Households Say Now Good Time to Buy

More than three-quarters (78 percent) of potential first-time home buyers say that now is a good time to buy a home, despite widespread concern about the economy.

Out of the 1,000 prospective U.S. first-time home buyers surveyed in early March for the CENTURY 21 First-Time Home Buyer Survey, 68 percent think now is a better time to buy than six months ago.

Prices are the driving motivation for potential first-time home buyers with more than eight of ten first-time home buyers (85 percent) saying they consider current home prices affordable and 73 percent citing that taking advantage of current prices is a major factor in their decision to buy.

Interestingly, potential first-time buyers are still split between “being willing to consider an offer now” (42 percent) and “waiting for prices to go down before they seriously consider making a purchase” (48 percent).

“Current pricing, rates and incentives, such as the First Time Homebuyer Tax Credit, provide tremendous opportunities for first-time home buyers to get into the market,” said Tom Kunz, Century 21 Real Estate president and CEO. “Our research shows that while consumers still have concerns about the future of the economy, many are actively considering their options as we move into the spring selling season.”

Among the survey’s other key findings:

• Bargains in the marketplace are providing additional options for buyers to consider. 56 percent of potential first-time home buyers are considering purchasing a foreclosed or short sale home, and 63 percent are open to purchasing either a “fixer-upper” or “as-is” home.

• When asked to rate the features that they look for when choosing a home, price is the primary consideration with 87 percent saying this feature is “very important,” followed closely by neighborhood safety (80 percent) and the condition of the home (71 percent).

• Having enough money for a down payment is a top concern of potential first-time home buyers as nearly half (46 percent) said they are “very worried” about the issue.

• Most respondents (86 percent) are in the market for single family homes.

Source: Century 21

Foreclosures VS Short Sales

Elizabeth Kayser, Esq.
Kayser & Associates, LLC
Short Sale Negotiators
St. Louis, Missouri
(314) 402-1788
attykayser@sbcglobal.net

Attorney at Law

OVER HALF OF FORECLOSURES SHOULD BE
SHORT SALES USING REALTORS, NOT FORECLOSURES
Short sales produce financial and nonfinancial rewards for all key players including the economy:
 Protect homeowners’ credit
 Keep properties occupied v. vacant properties (blight)
 Produce a happy buyer
 Minimize losses to lenders
 Allow Lenders to avoid having take back more distressed properties which results in the deepening national financial crisis.
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What is a “SHORT SALE?” Millions of homeowners are behind on their mortgage and can no longer make their mortgage payment due to either job losses, divorce, bad loans they should have never been placed in, an ARM that’s resetting higher, etc. Up to recently the only generally accepted option was foreclosure. That is usually not the ideal solution even if it does erase the mortgage lien since, 1) it does not preclude the bank from seeking a deficiency judgment against the borrowers (a personal judgment that is collectible after the conclusion of the foreclosure) and 2) a foreclosure devastates the homeowners credit. . . not good for realtors either as they are effectively removed from your client base.
Solution: Short Sale. Get the lender to accept an amount below the mortgage payoff and waive the deficiency against the homeowner. In most cases, all closing costs are built into the deal where the lender pays the closing costs. On occasion the Seller will need to bring cash to the closing table. Everything is case by case basis. Lenders generally demand fair market value for the property – which in a short sale is significantly below the mortgage balance.
Credit implications
The number one reason a distressed homeowner should proceed with a short sale is to protect their ability to obtain financing in the future. Most short sales result in a “settlement” status on their credit report as opposed to “foreclosure”. Fannie Mae and Freddie Mac guidelines are much more favorable to borrowers with short sale on their credit report, typically allowing a borrower to obtain financing for a new home within a couple of years. In sharp contrast, a foreclosure remains on a credit report for seven years, making it very difficult to finance another house, a car, open a new business, or even qualify for credit cards. Any loans received will most likely bear very high interest rates.
A Short Sale offers a fresh start, eliminating debt, while minimizing damage to credit and avoiding eviction proceedings.
What services are provided as part of the Short Sale Fee?
A crucial part of the SHORT SALE process is negotiating the terms of the short sale. In order to provide the best possible result, we gather the relevant information from the seller, prepare a hardship package to submit to the bank, perform a preliminary title search on the property to determine what liens, mortgages and taxes are due on the property if one has not already been done, and negotiate with the bank in an attempt to have them accept a lower payoff on the mortgage than is currently due…potentially avoiding the credit impact and economic ramifications of a foreclosure or bankruptcy. Most importantly, regular updates and status reports are provided to realtors and homeowners as to the short sale process. Communication is everything and will never be compromised. We will be a team in the short sale process requiring a continuous flow of communication.
• Prequalifying the homeowner
• Assemble excellent lender packages
• Directly and immediately respond to negotiators' calls and emails
• Immediately provide well-written market narratives and critical analyses proving price
• Ensure that appraisers and bank BPO agents understand the subject property's challenges
• Immediately provide additional documentation required by the lender
• Keep the parties well-informed and in the deal
• Document all tasks in detail for transaction-saving reference
• Provide creative solutions to negotiators' demands such as promissory notes and cash contributions
• Use 12 years of negotiations skills as an attorney and mediator to ensure success
Why allow my firm for your short sale negotiations?
There are many articles out there that say it is extremely important to get an attorney to handle your negotiations. The lenders have their attorneys, you should have yours. Short sales involve a myriad of legal issues, timelines, and landmines that can kill the deal, and result in devastating consequences for the buyer, seller, and realtor. The process of obtaining approval for a SHORT SALE is lengthy…taking as much as 8 to 12 weeks. The first step is to prequalify your client/seller. Lenders in most cases pay the negotiators as part of the closing costs on the HUD. The realtor still receives their commission but avoids the burden and hassles of dealing with negotiating a short sale.
Convincing the Lender
The bank will have to be convinced that the seller deserves to be approved for a short sale. They will need to disclose to the mortgage lender financial hardships, including layoffs, loss of jobs, divorce, medical issues. Some or all of the following would be required: hardship letter signed by the homeowners, 2 yrs tax returns, recent pay stubs, bank statements, authorization for the negotiator to discuss the mortgage with the lender. Lenders also request listing history, recent sold properties, repair estimates and photos, second mortgage payoffs if any, and other lien information. Lenders will furnish their requirements as to sellers’ assets, liabilities, income, and obligations. Our hardship package aims to fit within each Lender’s parameters. Each lender has different parameters, a different short sale policy. The contract must not be contingent upon the sale or closing of another property, also the seller cannot do owner-financing or carry-backs. The Lender often times verifies with the buyers lender that they are pre approved with no contingencies. Also, properties with multiple mortgages, 2nd liens are not the best short sale candidates but it can work.
Short sales may take longer to close than more conventional sales, so plan accordingly. However, it is well worth it. Again, the alternative – foreclosure.
How is a sales price determined?Most lenders will request a BPO (broker’s price opinion) or full appraisal of the property. In some cases they will use a drive-by value or a computer analysis comparing other similar homes that have sold. In this real estate market, this is very difficult – there are few sold homes! This is where the negotiation begins. Some factors negotiated are such things as close proximity to power lines, railroads tracks, busy streets, high numbers of neighborhood foreclosures (blight), declining market, repairs needed, the banks loss severity rate in a foreclosure to justify our offer price. Also negotiated hard is the lenders’ Loss Severity Rate.
Loss Severity Rate (What is this?)
Let me talk a little bankalese here (not legalese). This is the rate of loss a lender incurs in a foreclosure. Here’s an example: In a foreclosure, the bank recoups only a portion of the mortgage balance plus they incur significant property preservation costs (aka maintenance costs), legal fees, liquidation costs, additional “carrying costs”. The ‘net’ the bank receives after a foreclosure sale is divided into the total costs or ‘balance’ due which is now much higher than the original mortgage balance . . .resulting in the Loss Severity Rate. This rate has climbed to 40% of more. Much higher than a short sale!
Closing
Once an agreement is reach, the lender issues a short payoff to the realtor and the title company being used for the short sale closing. This letter will state the closing date, names of the parties, a Release of any deficiencies incurred by the lender, and any cash or promissory notes required from the seller. I am not the closing attorney and I do not go to closings. The title company continues to be the closer.
When is it too late?In Missouri, the foreclosure process can happen quickly, therefore a short sale must be identified before the seller receives a Notice of Foreclosure. The bank cannot delay foreclosure by more than one week in Missouri, however, the lender may cancel or “continue” foreclosure proceedings only if we have an accepted contract. Short sale candidates need to be identified and counseled before a Notice of Foreclosure is received. However, if a Notice has been received recently, let us still counsel the homeowner, then we’ll see what we can do about securing an accepted contract quickly and we will communicate with foreclosure department and attorneys. There are instances where we may be able to get a short sale through before the Trustee Sale.
Short Sale vs. Bankruptcy
 Lenders cannot consider a short sale if the borrower is in an active bankruptcy. The bankruptcy would have to be discharged or dismissed prior to the lender considering a reduced payoff.
 There are many bankruptcies that are filed to save a homeowner from the deficiency judgment or shortage in the sale of their home – when really all they needed was a short sale of their home!
 A bankruptcy stays on the homeowners credit report for 10 years.
 Bankruptcies typically only delay the inevitable. . . a foreclosure. Then the homeowner has both a bankruptcy AND a foreclosure on their credit report. The worst case scenario for anyone.
Short Sale vs. Foreclosure
 Foreclosure is devastating to one’s credit report. Someone who goes the short sale route generally can buy a home in less than 2 yrs, compared 5 yrs + after a foreclosure. Many employers run credit checks on prospective employees and foreclosure is one of the top items that will put a potential new hire in jeopardy. Also, current employers may run credit checks and a foreclosure can put a current position in jeopardy. Security clearances (law enforcement) and government positions can be jeopardized by a foreclosure. Additionally, interest rates will be markedly high on credit cards and any credit with a foreclosure or a deed in lieu on one’s credit report.
 The lender can still pursue the former homeowner with a Judgment for any deficiency after the property sells under foreclosure. This deficiency most likely will tack on attorney fees, costs to sell the property, and many other related fees such as property preservation fees, insurance and the like.
 Foreclosure effectively reduces your potential clients as buyers as it is rare to secure financing for another home for a long time after a foreclosure is reported on one’s credit report. So, not only did you not make a cent off of that foreclosure. . .you just lost another potential client.
 From the lenders standpoint – see Loss Severity Rate above! Enough said.
Taxes
The Economic Stabilization Act extends the Mortgage Forgiveness Debt Relief Act to 2012.

Qualified principal residence indebtedness is defined as acquisition indebtedness, the dollar limitation is $2 million with respect to the taxpayer’s principal residence. Acquisition indebtedness generally means indebtedness incurred in the acquisition, construction, or substantial improvement of the principal residence of the individual and secured by the residence. It also includes refinancing to the extent of the original debt (not any cash that was taken in the refi). So, the amount unpaid to a lender in a short sale is technically considered income to you. HOWEVER, for the tax years 2007 through 2012, the government is waiving any tax liability on that phantom income. The lender will send you and the IRS a copy of Form 1099-C "Cancellation of Debt," reporting that forgiven debt as income. To make sure you are not taxed on the amount, you will have to file Form 982, "Reduction of Tax Attributes Due to Discharge of Indebtedness." Forms can be downloaded free from http://www.IRS.gov. Be aware, that forgiven debt on vacation homes and rental properties may be taxable, unless you can prove insolvency.

This document is not intended to give tax advice. It is advisable to confirm the current tax laws with each case with a CPA or tax attorney.