Real Estate Information

One of the biggest reason short sales fall through, according to JK Huey, a vice president at Wells Fargo, is that real estate agents do not regularly pre-check buyer access to finances.

Instead, agents assume buyers can get the money, but often this isn't the case, she said, speaking at the Texas Mortgage Bankers Association servicing conference being held today in Grapevice, TX.

"We want to encourage clients to obtain a credit-check before," Huey said, adding that the lender is looking to streamline the short sale process to "around 30 days."

This would include satisfying any second liens, investor concerns and other mitigating circumstances, such as accurately valuating the property.

"We get some low-ball offers," that also slow down the process, she said.

Wells Fargo is willing to put distressed borrowers through their own short sale process, in cases where they don't qualify for HAFA.  In this case, the servicer will still need a promissory note for investors, mortgage insurance companies and junior-lien holders that shows financial obligation to these firms are met.

Wells, recently gave a general commitment for second lien write downs, alond with the other top three mortgage servicers in the country.

"We are commited to do all we can to get the customer through their disruption and keep them in their homes, but our commitment is to partner with you to help these customers transition smoothly," Huey added.

Huey's comments were well-received by the audience, though in the question and answer session, one audience memeber asked for clarification on the timeline.

"In reality we are waiting months," said the attendee.  "I think it's popular Realtor opinion that this [bank] department doesn't talk to that [bank] department.  We had four short sale offers and three went to foreclosure."

Huey responded that there are many pieces to HAFA short sales.  And generally if a home is closer to foreclosure it will make sense to go ahead and foreclose.  A property must not only be owner-occupied but also not be close to foreclosure, in order to qualify for HAFA, which adds another layer to the process.

Distressed homeowners no longer have to pay California state income tax on debt forgiven in a short sale, foreclosure, or loan modification.  Senate Bill 401, enacted April 12, 2010, generally aligns California's tax treatment of mortgage debt relief income with federal law.  Qualified principal residence borrowers will now be exempt from both federal and state income tax consequences.  The new California exemption is for indebtedness up to $800,000, rather than $2 million, and forgiven debt up to $500,000.

Qualified principal residence indebtedness is debt incurred in acquiring, constructing, or substantially improving a principal residence.  It includes both first and second trust deeds.  It also includes a refinance loan to the extet the funds were used to payoff a previous loan that would have qualified.

The tax breaks apply to debts discharged from 2009 through 2012.  Californians who have already filed their 2009 tax returns may claim the exemption by filing a Form 540X amendment.

However, taxpayers who do NOT qualify for the above exemptions may be exempt under other provisions.  Unfortunately, bankrupt and insolvent taxpayers are exempt from debt relief income tax.

Tags: state tax, debt, indebtedness, Form 540X, Senate Bill 401, qualified principal residence
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Living in a world with tax apps for iPhones and e-filing of tax returns, you do a double-take after finding out that the Internal Revenue Service wants paper from taxpayers filing for a home buyer credit.

"If I have a Form 5405 in my return, I have to paper-file, period," said Don Schippa, president of Tax Research Services in Southfield, Mich.  "They're forcing you to file a paper retrun."

Blame the IRS requirement outrageous fraud committed last year in pursuit of the up-to-$8,000 tax credit for first-time home buyers, including one in which a 4-year-old supposedly bought a house.  Last fall, the IRS said it was looking into more than 70,000 suspicious claims.  It was obviously way too easy to cheat.

So, if you bought a house in 2009 hoping for one of the two housing-related credits, get ready to file a Form 5405, submit a paper return and dig up more documents as proof that you qualify.

"Currently, the e-file system is not able to handle the wide variety of required and recommended supporting documents that would have to be scanned and submitted," said Luis D. Garcia, IRS spokesperson in Detroit.

The IRS isn't saying that you or your preparer should pull out a pencil and skip using tax software.  Use software to avoid mistakes.  Just print out the return and snail-mail it- along with all the required documents.

The painfully long list of rules associated with the credits for home buyers makes retiling the bathroom seem like a breeze.  And there are traps.  For example, if you own a home, you cannot but another one, give it to a son or daughter and tell them to claim the first-time buyer's credit.

However, a parent and child can be co-buyers.  A parent could give a son or daughter money to buy a home, and then the offspring, if older than age 18 on the purchase date, could get the credit.  But in another twist, a son or daughter who is still a dependant for tax purposes is not eligible to claim the credit.

Tax credits will still be available for some home purchases in 2010.  Here are some of the rules you need to know:

- One tax credit designed to spur home sales offers up to $6,500 for some homeowners who buy a new house but have lived in another home for five consecutive years.  The five years can be within an eight-year period ending on the date you bought the home on which you're claiming the credit.  So technically you did not have to be living in the old house when you bought the new one.  This credit for longtime residents could apply to a home bought Nov. 7, 2009 through April 30, 2010.  The buyer must have a contract in place by April 30, and the deal must close by June 30.  You must move into the newly purchased home, Schippa said, but you do not have to sell your old home.  "that's kind of a funny twist to it," he said.  The $6,500 credit is not avaliable for the purchase of a second or vacation home.

- A first-time buyer of a principle residence is allowed a refundable tax credit for 10% of the purchase price- up to a maximum of $8,000.  This credit is for indivduals and couples on purcahses between April 8, 2008 and April 30, 2010.  There are several versions of the credit, depending upon when the home was purcahsed.  The latest version does not require that money from the credit be paid back.

Taxpayers with higher incomes can now qualify for the credit.  Both home buyer credits are phased out for taxpayers with modified adjusted gross incomes between $125,000 and $145,000- or between $225,000 and $245,000 for joint filers.  The IRS noted that the new law raises the income limits for homes purchased after Nov. 6, 2009.

You're not going to get a tax break, though, if you bought a mutlimillion-dollar mansion.  No credit is available if the purchase price of the home exceeds $800,000.

The refundable credits mean that individuals can get a check from the governement whether or not they have an actaul tax liability.

For homes bought this year, the credit can be claimed on the 2009 or 2010 return.

As for the documentation, when you send in the tax return, include a copy of the closing contract (HUD-1 Settlement Statement), the most recent monthly mortgage statement, occupancy permit (if newly constructed) and at least two of the following showing name and address: current driver's license or other state-issued ID, pay stub or bank statement from within the past two months, or current automobile registration.

Long-term residents who are claiming a credit must prove how many years they lived in the old home and attach a Form 1098, Mortgage Interest Statement (or substitute statement), property tax records or homeowner's insurance records.

When new home buyers have a shot at getting thousands of dollars, it can pay to learn the rules- and supply the proper paperwork.

Tompor, Susane. "First-time and Move-up Tax Credits Require Paper Trail When Filing Taxes." The Leader in Real Estate Information Ssytems. RisMedia. McClatchy-Tribune, 10 Apr. 2010. Web. 12 Apr. 2010. http://rismedia.com/2010-04-10/first-time-and-move-up-tax-credits-require-paper-trail-when-filing-taxes/.

Tags: internal revenue service, form 5405, tax research, tax software, home related credits, $8000 tax credit, $6500 tax credit, homebuyers, 2009 or 2010 tax returns
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Tracy took another step toward turning an area north of the city into a vast neighborhood of community parks and recreation sites Tuesday night.

The City Council, which is already considering a 298-acre sports park at the former Holly Sugar plant site, heard the opening gambit in negotiations with San Joaquin County regarding an adjacent 100-acre parcel.

Though negotiations were held in closed session and lasted only 20 minutes, they marked another milestone in the council's broader vision for a combined 1,200-acre swatch of city-owned property.

"In the long term, we see it being a regional entertainment and sports area," City Manager Leon Churchill said.  "There would be places for active and passive recreation, a possible wetlands and a motor sports park."

The 100-acre site east of Tracy Boulevard, which the county is currently eyeing, is among four known plans for a large chunk of the 1,200 acres, the others being:

A 400-acre motor sports park west of Tracy Boulevard.

A wetland of indeterminate acreage east of Tracy Boulevard.

The 298-acre Holly Sugar Youth Sports Park project west of Tracy Boulevard- what Mayor Pro Tem Suzanne Tucker called the "crown jewel."

The latter project is "the only one coming into focus at the moment," Councilman Michael Maciel said.

The council is scheduled to meet May 18 to discuss certifying the final version of the environmental impact report on the sports complex.  Once that step is cleared, the sports complex will be on the way to meeting the goal the council set in September 2008 of having the infrastructure read by mid-2012, with completion of the fields sometime after that.

The main part of the plan would see 166 acres turned into a broad plain of more than 40 playing fields for baseball, soccer, softball and football. It would also include one football/soccer stadium complete with lighting and seating, plus four children's play areas.

Two other areas are intended for later development; an 86-acre passive recreation area and a 46-acre site for active pursuits such as skateboarding, bicycle motocross and basketball.

The city has estimated costs of $11 million for preparing the first phase of the sports park.  That amount would cover water, drainage, roads and parking, with youth sports leagues involved in the construction and maintenance of the fields.

It's a Winner!

I can't believe we are into spring already.  It seems like just yesterday we were celebrating the New Year!  However, I wanted to share with you this months podcast and what it has to offer.

The main topic is the discussion of the $8,000 tax credit offered by the Obama Administration. Obama's new plan is that the homebuyer will have to be IN CONTRACT by April 30, 2010 and CLOSE the purchase by June 2010.  That is great news for all the buyers we have out there!  And, California is offering an additional $10,000 tax credit on top of the $8,000 offered by the federal government.

Also, we encourge you to take a look at our blog.  We recently had a client who came to us after writing 20 offers with another agent and got nowhere, so we wrote ONE offer for her and that ONE offer was excepted in a matter of days!  Using our "buyer advantage system" we were able to get her into contract and get her closed.  Read more about it on our blog entitled "It's A Winner". 

As for the market here its the best time to buy!  Click here to hear the reasons why.

Until next time,

Bill

Tags: $8000 tax credit, obama administratin, it's a winner, buyers, sellers
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A Tracy women who Charlene Ware has never met and who lives in a town she's never seen was able to help her keep her home, even though it was deep in foreclosure.

Ware, who lives in the desert town of Lancaster, about 70 miles north of Los Angeles, said she had trouble making payments on her four-bedroom house after she took in some relatives whose parents were having financial problems of thier own.

Ware started missing payments and tried to get a better rate through various loan modification companies, she said, but none was able to help much.

After the house was auctioned off, Ware said, she thought there was nothing she could do.  But one of the companies Ware had talked to mentioned Omyra Munoz, who lives in Tracy, and said she might be able to help.  At the time, the family had been evicted, Ware said, and was living in a motel.

Munoz told Ware about something called the right of redemption: Once a trustee's sale finishes, the homeowner has a year to catch up on payments, Munoz said.  Realtor Ken Allen, who lives in Mountain House, said that often, homeowners don't work with the bank after auctions to try to get their house back.

Munoz, a mother of five who worked in the mortgage industry before she was diagnosed with Crohn's disease, talked with the vice president of the bank that owned Ware's home and got to the point where Ware could negotiate a better rate.

"We both have a fighting spirit, but it's a tough battle and you really need support and you need a person that's there for you, and Omyra was that person," Ware said.  "She was able to speak to the banks in ther language, while most of us are not."

Ware said that when she bought the house in 2007, it was worth about $450,000.  Today, her home is worth about $165,000.  She said she was able to get her mortgage payment down to about one-third of what it was before she talked to Munoz.

Ware is one of many people who have been helped by Munoz, a stay-at-home mother who works with people like Ware as if it were her full-time job, but asks for nothing in return.

"How do I say no to a family when I was in the same position?" Munoz said.  "I was grasping for straws when I was in that position, and there was no one to help me.  I can't put another family through that."

Munoz said she was diagnosed with Crohn's disease September 17, 2006, and she took a few months off from her job as a senior loan processor with Mortgage Funding Associates in Fremont to get a handle on the disease.  When she returned, she said, the market had completely flopped, and there was little business for her.

By 2007, Munoz's home was in foreclosure, and she felt she was getting no help from loan modification companies she hired and figured she'd be better off trying to do the work herself.  Munoz found out about the right of redemption after her house had already been auctioned and sold to the bank.

After that, she said she spread the work to friends and relatives who were in similar foreclosure trouble.  Her services have become popular largely through word of mouth, Munoz said.

Munoz said she bought her house planning to raise her family in Tracy, and she was willing to do whatever she could to make sure it stayed that way.  Now, she's banding together with other local homeowners to fight banks who might be giving people the runaround, she said.

However, things will probably get tougher for Munoz in the future.  her husband worked at NUMMI in Fremont, but now that the plant closed, he's out of a job.  Munoz said she will do what she can to make ends meet and still help people for free.

"She's very determined," said Jason Woo, a real estate appraiser in Lathrop and a friend of Munoz who said he helps her when he can.  "She won't back down for anybody."

The following information is from the local MLS database, as of April 5, 2010 and is compared to (March 2, 2010).  If you are interested in a little more market information feel free to give us a call, we are always happy to talk about the market.

 

Tracy, CA 

 

ACTIVE Status

Total # of residential properties for sale in the city of Tracy: 365 (423)

# of REO (foreclosures): 47 (57)

# of Short Sales: 275 (284)

Average # of days on market: 57 (82)

The median price of all homes for sale in Tracy: $219,500 ($254,900)

The average price of all homes for sale in Tracy: $264,524 ($353,929)

Lowest priced home: 1bd/792 sq. ft. /$49,900

Highest priced home: 6bd/5,159 sq. ft. /$1,299,000

 

Square Feet	# of homes for sale in Tracy	Median List Price	Average List Price
1,000 to 1,400	24	$169,450	$195,072
1,500 to 2,000	27	$224,900	$237,822
2,000 to 4,000	26	$314,900	$337,276

 

PENDING Status

Number of properties currently under agreement: 310 (281)

# of REO: 89 (83)

# of Short Sales: 149 (138)

Average pending price: $227,331 ($220,879)

 

Average pending home is 4 bedrooms, 2,004 square feet at a price of $227,331 that stays 36 days on the market.

 

Square Feet	# of homes for pending in Tracy	Median Pending Price	Average Pending Price
1,000 to 1,400	50	$150,000	$149,448
1,500 to 2,000	85	$207,800	$202,220
2,000 to 4,000	146	$269,900	$277,864

 SOLD Status

Residential property sold over previous 30 days: 114 homes or $25,462,240 in sales (97 homes or $22,192,250 in sales)

REO’s sold in the last month: 48 (41)

Short sales sold in the last month: 30 (27)

Average sale price: $223,353 ($228,786)

Median sale price: $228,500 ($225,000)

High: 452K (6bd/4,098 sq. ft. home)

Low: 45K (2bd/826 sq. ft. home)

 

Square Feet	# of homes sold in the last month in Tracy	Median Sale Price	Average Sale Price
1,000 to 1,400	19	$129,000	$133,500
1,500 to 2,000	34	$212,500	$209,243
2,000 to 4,000	46	$270,150	$278,282

 

 

Mountain House, CA

ACTIVE Status

Total # of residential properties for sale in the city of Mountain House: 126 (85)

# of REO (foreclosures): 6 (5)

# of Short Sales: 93 (68)

Average # of days on market: 22 (19)

The median price of all homes for sale in Mountain House: $348,900 ($325,000)

The average price of all homes for sale in Mountain House: $334,565 ($322,712)

Lowest priced home: 2bd/1,262 sq. ft. /$159,900

Highest priced home: 5bd/3,858 sq. ft. /$434,600

 

Square Feet	# of homes for sale in Mountain House	Median List Price	Average List Price
1,000 to 1,400	2	$179,950	$179,950
1,500 to 2,000	6	$284,400	$265,567
2,000 to 4,000	25	$365,000	$363,494

 PENDING Status

Number of properties currently under agreement: 78 (90)

# of REO: 21 (19)

# of Short Sales: 39 (42)

Average pending price: $310,251 ($299,805)

 

Average pending home is 4 bedrooms, 2,645 square feet at a price of $310,251 that stays 33 days on the market.

 

Square Feet	# of homes pending in Mountain House	Median Pending Price	Average Pending Price
1,000 to 1,400	2	$202,450	$202,450
1,500 to 2,000	9	$204,900	$218,199
2,000 to 4,000	64	$332,500	$332,954

SOLD Status

Residential property sold over previous 30 days: 34 homes or $10,972,400 in sales (25 homes or $7,747,200 in sales)

REO’s sold in the last month: 13 (11)

Short sales sold in the last month: 9 (11)

Average sale price: $322,718 ($309,888)

Median sale price: $320,450 ($301,000)

High: 442K (6bd/4,082 sq. ft. home)

Low: 165K (2bd/1,262 sq. ft. home)

 

Square Feet	# of homes sold in the last month in Mountain House	Median Sale Price	Average Sale Price
1,000 to 1,400	2	$196,750	$196,450
1,500 to 2,000	5	$202,500	$209,700
2,000 to 4,000	26	$345,000	$350,015

 

Lathrop, CA

 

ACTIVE Status

Total # of residential properties for sale in the city of Lathrop: 114 (121)

# of REO (foreclosures): 13 (26)

# of Short Sales: 84 (78)

Average # of days on market: 59 (38)

The median price of all homes for sale in Lathrop: $199,900 ($198,800)

The average price of all homes for sale in Lathrop: $276,642 ($243,237)

Lowest priced home: 2bd/1,037 sq. ft. /$95,000

Highest priced home: 5bd/3,870 sq. ft. /$2,500,000

 

Square Feet	# of homes for sale in Lathrop	Median List Price	Average List Price
1,000 to 1,400	5	$142,900	$136,360
1,500 to 2,000	7	$165,900	$182,101
2,000 to 4,000	17	$224,900	$362,515

 PENDING Status

Number of properties currently under agreement: 100 (74)

# of REO: 50 (37)

# of Short Sales: 29 (28)

Average pending price: $182,716 ($186,520)

 

Average pending home is 4 bedrooms, 2,157 square feet at a price of $182,716 that stays 37 days on the market.

 

Square Feet	# of homes pending in Lathrop	Median Pending Price	Average Pending Price
1,000 to 1,400	15	$119,900	$123,479
1,500 to 2,000	30	$155,000	$157,032
2,000 to 4,000	52	$215,950	$219,015

SOLD Status

Residential property sold over previous 30 days: 31 homes or $5,544,437 in sales (31 homes or $6,098,000 in sales)

REO’s sold in the last month: 19 (16)

Short sales sold in the last month: 11 (2)

Average sale price: $178,853 ($196,710)

Median sale price: $185,000 ($204,000)

High: 306K (5bd/4,165 sq. ft. home)

Low: 42K (2bd/840 sq. ft. home)

 

Square Feet	# of homes sold in the last month in Lathrop	Median Sale Price	Average Sale Price
1,000 to 1,400	6	$105,500	$104,867
1,500 to 2,000	7	$161,500	$166,257
2,000 to 4,000	15	$207,500	$218,296

 

Weston Ranch, CA

 

ACTIVE Status

Total # of residential properties for sale in Weston Ranch: 112 (105)

# of REO (foreclosures): 24 (19)

# of Short Sales: 75 (78)

Average # of days on market: 34 (38)

The median price of all homes for sale in Weston Ranch: $166,900 ($164,900)

The average price of all homes for sale in Weston Ranch: $167,496 ($164,991)

Lowest priced home: 3bd/1,200 sq. ft./$128,800

Highest priced home: 6bd/3,000 sq. ft./$229,000

 

Square Feet	# of homes for sale in Weston Ranch	Median List Price	Average List Price
1,000 to 1,400	1	$128,800	$128,800
1,500 to 2,000	16	$152,400	$154,906
2,000 to 4,000	18	$176,950	$182,786

 

PENDING Status

Number of properties currently under agreement: 105 (106)

# of REO: 38 (42)

# of Short Sales: 42 (35)

Average pending price: $151,705 ($150,011)

 

Average pending home is 4 bedrooms, 2,049 square feet at a price of $151,705 that stays 35 days on the market.

 

Square Feet	# of homes pending in Weston Ranch	Median Pending Price	Average Pending Price
1,000 to 1,400	7	$104,900	$102,800
1,500 to 2,000	44	$136,950	$136,408
2,000 to 4,000	48	$171,445	$176,162

 SOLD Status

Residential property sold over previous 30 days: 44 homes or $6,828,580 in sales (31 homes or $4,937,100 in sales)

Short sales sold in the last month: 7 (10)

REO’s sold in the last month: 27 (14)

Average sale price: $155,195 ($159,261)

Median sale price: $155,000 ($158,000)

High: 220K (5bd/3,153 sq. ft. home)

(225K (6bd/3,376 sq. ft. home))

Low: 105K (3bd/1,208 sq. ft. home)

(90K (3bd/1,547 sq. ft. home))

 

Square Feet	# of homes sold in the last month in Weston Ranch	Median Sale Price	Average Sale Price
1,000 to 1,400	4	$125,000	$121,000
1,500 to 2,000	20	$149,950	$145,879
2,000 to 4,000	16	$183,000	$181,688

Tags: market trends, market information, active status, pending status, sold status, average pending home, tracy, mountain house, lathrop, weston ranch
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California short sellers to pay tax on mortgage debt

Govenor Schwarzenegger last week vetoed a bill that would have prevented California homeowners who sold their homes via short sales or received loan modifications in 2009 from being taxed on the forgiven mortgage debt.  Schwarzenegger vetoed the bill, which would have aligned much of the state's tax code with that of the federal government's, because it contained an unrelated provision regarding tax refunds for the state's largest businesses.  Although the govenor vetoed this particular debt, and immediately called for the legislature to send him a bill to provide tax forgiveness prior to the April 15 tax-filing deadline.

C.A.R. currently is supporting two stand-alone measures, AB 1779 (Niello) and SB 14 (R. Calderon and L. Correa) of the Sixth Extraordinary Session, that would fully conform to the federal rule extending "phantom" income debt forgiveness through December 31, 2012.

Click here to read about it more.

 

HAMP adjustments may help struggling homeowners

The Obama Administration on Friday announced adjustments to the Home Affordable Modification Program (HAMP) and to the Federal Housing Administration (FHA) program to assist homeowners struggling to meet their mortgage obligations.  The program adjustments target three groups: unemployed homeowners who are unable to make their mortgage payments; underwater homeowners; and homeowners behind on their payments and seeking loan modifications.

Unemployed homeowners may qualify for three to six months of reduced payments while searching for new employment.  During this time, payments will be reduced to 31% of their current gross monthly income.To qualify, borrowers must, among other things, be living in their homes, have loan balances less that $729,750, provide verification of unemployment benefits, and request assistance within 90 days of delinquency on the mortgage.

Underwater homeowners- those who owe more than their home currently is worth- may be eligible for a new FHA refinance option that will allow those who are current on their mortgage payments to refinance their mortgages into new FHA- insured loans equal to no more than 115 percent of their home's current value.  The difference between the original loan balance and the new balance gradually will be forgiven if the homeowner remains current on payments for three years.

Homeowners seeking mortgage modifications under HAMP may be eligible for mortgage principle reductions.  Although lenders always have had the option to do so, many have chosen instead to reduce interest rates.  However, under the new guidelines, lenders reducing mortgage principle may receive higher financial incentives.  The incentives will be paid jointly by the private sector and the federal government through a $50 billion allocation from the Troubled Asset Relief Program (TARP) 

The program changes are expected to go into effect in the fall.  However, a measure to offer larger incentives to lenders who facilitate short sales or deeds-in-lieu of foreclosure, as well as assistance for unemployed homeowners, will be in place within a few weeks or months, according to the administration.

Click here to read about these new incentives.

 

Federal tax credit update.

Time is running out on the federal tax credits for first-time and repeat buyers.  First-time buyers who enter a binding contract by April 30 and close escrow before July 1- and meet the income limits- are eligible for the full $8,000 credit (maximum, or 10% of the sales price, ehcihever is less) on their federal tax returns.  The first-time home buyer credit applies to homes purchased for $800,000 or less, and does not require repayment if buyers live in the residence for three or more years.

Existing homeowners may be eligible for a tax credit (10% of the purchase price, not to exceed $6,500).  To be eligible for this credit, homeowners must have lived in their current home for five consecutive years out of the last eight years and must enter a contract to purchase a new or existing home by April 30, 2010.  Existing homeowners do not need to sell their current home to qualify for this credit, but must close escrow before by June 30, 2010.  For complete details on these credits, qualifications, income levels and income phase-outs, visit "Legal Q&As" at car.org.

Please note that "Tax Credits Set to Expire," an article which appeared in the March/April issue of "California Real Estate" magazine, is available in downloadable format here.

Tags: HAMP, TARP, FHA, AB 1779, SB 14, debt forgiveness, underwater homeowners, unemployed homeowners, loan modifications, first time buyers, existing homeowners
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$18,000 in combined homebuyer tax credits for a limited time. 

Californians have a brief window of oppurtunity to receive up to $18,000 in combined federal and state homebuyer tax credits.  To take advantage of both tax credits, a first-time homebuyer must enter into a purchase contract for a principle residence before May 1, 2010, and close escrow between May 1, 2010 and June 30, 2010, inclusive.  Buyers who are not first-time homebuyers may use the same timeframes to receive up to $16,500 in combined tax credits if they are long-time residents of their existing homes as permitted under federal law, and they purcahse properties that have never been previously occupied as provided under California law.

Under the federal law slated to soon expire, a first-time homebuyer may receive up to $8,000 in tax credits, and a long-time resident may receive up to $6,500, for certain purchase contracts entered into by April 30, 2010 that close escrow by June 30, 2010.  Additionally, under a newly enacted California law, a homebuyer may receive up to $10,000 in tax credits as a first-time homebuyer or buyer of a property that has never been occupied.  The new California law applies to certain purchases that close escrow on or after May 1, 2010 (see Cal. Rev. & Tax Code section 17059,1(a)(4)).  California law generally allows buyers of never-occupied properties to reserve their credits before closing escrow, but buyers seeking to combine the federal and state tax credits will not be able to satisfy the timing requirements for such reservations (Cal. Rev. & Tax Code section 17059.1 (c) (1)(A)).  Other terms and restrictions apply to both tax credits.

For more information, C.A.R. offers a homebuyer tax credit chart with a sdie-by-side summary of the federal and California laws.  C.A.R. also offers a legal article entitled Homebuyer Tax Credit Update.

C.A.R. provides REALTORS with many other legal articles covering a wide range of topics of interest.  Some of the new or newly revised legal articles available at http:///ga.car.org are as follows:

- Federal Lead-Based Paint Renovation Rule: Provides new certification requirements and lead-safe work practices effective April 22, 2010 for contractors and property owners performing renovations that disturb lead-based paint in target housing.

- HAFA short sale fact sheet.