Shirley Kistler's Real Estate Blog: Serving your Real Estate Needs in Sacramento, Placer and El Dorado Counties

A recent survey conducted by FindLaw.com a legal information website found that 60% of Americans believe that it is “never OK” for homeowners to simply stop making payments on their mortgages.  34% say it’s OK for homeowners to walk away from mortgages, but only if they aren’t able to make the monthly payments.  Only 3% believe that homeowners should be able to walk away from their mortgage anytime they want. 

Before making any major decisions, homeowners should consult with financial and legal professionals, including accountants, real estate attorneys and financial advisors.  Any major change to a mortgage situation could lead to serious and unanticipated consequences involving taxes, contract law, credit scores, ability to borrow in the future, potential for lawsuits and much more.

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• Is Walking Away From Your Mortgage OK? (creditloan.com)
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When to Prune?  Knowing the right time is crucial, pruning at the wrong time may not damage plants but it can sacrifice that year’s flowers or fruit. 

Late spring/Early Summer
Prune spring-flowering shrubs and trees which flower before July 1 immediately after the flowers fade. 

Midsummer
Several deciduous trees produce a heavy sap flow in early spring.  Pruning braches in this season won’t kill the tree, but the sap flow can bleed on to outdoor furnishings, patios, cars and walkways.  Avoid a sticky situation by pruning these trees in midsummer.  

Fall/Early Winter
Spring and Summer blooming hawthorns and viburnums are typically grown for their fruits, which attract wildlife.  Don’t prune these plants after flowering.  Allow fruits to mature and then prune plants after wildlife consume fruits.

Winter/Early Spring
Prune summer blooming trees and shrubs in winter or early spring, before new growth emerges.

Tips for Pruning
Keep cutting surfaces clean and sharp.  Keep metal parts of pruning tools oiled regularly to prevent rust.  Use pruning tools for pruning only, other materials can dull or damage the blades. 

No matter what kind of plant you’re pruning, you will use three basic techniques. 

Pinching is typically done by hand, using thumb and forefinger.  It’s a good method to increase bushiness and curtail and control plant size. 

Thinning involves removing branches back to the trunk, a main branch or the soil line.  With thinning cuts, don’t remove the branch collar (the wrinkled area near the trunk or main branch).  This area contains the cells needed to heal the cutting wound.  Slicing in the branch collar creates an opening for infection and disease to enter. 

Heading back shortens branches to a healthy bud or lateral branch.  Place cuts roughly ¼ inch above the bud or branch.

 This article is excerpted from Lowe’s Creative Ideas magazine.

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Protect your home and family now!

California residents must have carbon monoxide detectors in their homes as of July 1, 2011.  This timeline applies only to single-family homes that have appliances that burn fossil fuels (wood, gas and oil) or homes that have attached garages or fireplaces.  For all other types of housing, such as apartments and hotels, detectors should be in place as of January 1, 2013. 

Related articles

• Carbon Monoxide Detectors Mandated by July 1, 2011 (nextgenrecorp.wordpress.com)

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Have you noticed those crazy little squares popping up in magazines, flyers and mailers that look like a Rorschach test?  

People have been drawn toward QR codes because they are new, look cook and they are tech-savvy. 

What is a QR Code

A QR Code is a two-dimensional barcode, which has encoded in it a URL (web address), text, or other information. It can be read by a QR code scanner, including QR scanner smartphone apps.

How can I read a QR code?

If you have a smartphone, go to the app store and search for a QR code reader. You’ll find several free apps. Run the app and then hold your phone’s camera over a QR code to read it. Most QR codes you’ll come across have a URL encoded, so chances are when you read the QR code it will take you to a web page.

What’s the point of QR codes?

QR codes link offline information to online content, effectively providing additional information and even multimedia to an offline experience. If you’ve created print material that included a URL for more information, a QR code for that URL could also be added to enable smartphone users to go directly to that web page without having to type in the web address.

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Are you trying to decide whether to sell your home on your own or hire a Realtor?  Check out this survey to help you make a decision:

Homegain.com conducted a survey on selling your home: For Sale by Owner “FSBO” vs. REALTOR_®.  Homeowners were asked whether they used a REALTOR_® to sell their home or whether they attempted to sell it themselves. 

83% said they used a REALTOR_® and 17% tried on their own.

59% of homeowners that used a REALTOR_®  to sell their house were successful vs. 39% of the FSBO’s reflecting a 50% higher closing rate for those using a REALTOR_®  

81% of the homeowners that used a REALTOR_® to try and sell their homes said they would use a REALTOR_®  again for their Real Estate needs.

88% of the homeowners that used a REALTOR_® to try and sell their homes said they would use a REALTOR_®  again.

71% of FSBO’s who managed to sell their home on their own said they would try and sell their home on their own again.

The survey also pointed out that 24% of FSBO’s eventually enlisted the aid of a REALTOR_®

 Related articles

• HomeGain Survey Finds Home Sellers Fare 50% Better in Getting Their Homes Sold Using a REALTOR Than Selling On Their Own (chrisjohnsonre.wordpress.com)

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If you have previously been foreclosed on or are currently in the process of losing your home to foreclosure?  Additional help may be on the way soon. 

The New York Times was able to get a preview of what the agreement contains from individuals who spoke on the condition of anonymity. 

Amount the proposed changes include: 

• Greater oversight of foreclosures.  The oversight will happen from third party groups that include law firms, who mostly will be charged with doing the actual work of eviction. 
• The improved training of foreclosure staff.
• A single point of contact for every defaulting home owner with the servicers. Mortgage servicers will no longer be able to foreclose while borrowers are pursuing loan modifications.
• Servicers will hire independent consultants to review foreclosures that have been completed in the past two years.  Mortgage servicers have agreed to compensate any owner who is found to have been improperly foreclosed on or made to pay excessive fees.

 Analysts say that in order for mortgage servicers to meet these revamped rules they will need to hire more employees so they can thoroughly review the cases of home owners in default or servicers will need to slow the pace of foreclosures even more (The average household in foreclosure has been delinquent for more than 500 days). 

Click here for the complete article from the New York Times

There are some tax benefits in purchasing a home vs. renting.  You should speak with a bona fide tax professional and have a tax professional run the numbers to find out what benefits you may qualify for. 

Purchasing a Home: 

Home Mortgage Interest Deduction:  At this time, the interest paid on a mortgage or mortgage of up to $1 million for a principal resident and/or second home is deductible as an itemized deduction.   

Home Equity Loan Deduction:  Homeowners can borrow up to $100,000 against the equity in their home and deduct the interest as an itemized deduction.  The money can be used for any purpose, such as paying off high-interest credit card debt.  Credit card interest is not deductible. 

Property Tax Deduction:  Homeowners also get to deduct from their federal income taxes the state and local property taxes they pay on their home. 

Deductible home buying expenses:  Various closing costs ordinarily involved in a home purchase are also deductible as itemized deductions, including points, prorated interest and taxes. 

$250,000/$500,000 home-sale exclusion:  Perhaps the greatest tax benefit of owning a home comes when a person sells it at a profit.  Homeowners who lived in their home for two of the prior five years prior to its sale need pay no income tax on a substantial amount of their profit – $250,000 for single homeowner’s and $500,000 for married homeowners who file jointly.  This exclusion can be used once every 24 months. 

14 days of free rental income:  Another little known tax benefit of owning a home is that the owner can rent it out for up to 14 days during the year and pay no tax at all on the rental income.   

Renting a home: 

Home Office deduction:  The only tax benefit that a renter can qualify for by virtue of being a renter is the home office deduction.  This is a business deduction available to renters who own a business and have a home office they use regularly and exclusively for business purposes. 

Of course, the value of the tax benefits of buying a home depends on the state the buyer live in and their tax bracket.  Buyers who live in high tax states like New York or California get the most benefit.  

Source:  Inman News and Stephen Fishman

Related articles

• Tax Advantages of First Time Home Buyers Explained (doorfly.com)
• Home Ownership Tax Deductions (turbotax.intuit.com)

Americans have a renewed interest in all things frugal during this recession.  They’re spending less money, using credit cards less. 

About ½ of Americans report they either avoid shopping altogether or shop only for those things that are absolutely needed, according to a survey sponsored by Citi.  72% of Americans say they have cut back on everyday expenses. 

In addition, 80% claim to have at least a plan for income and expenses, up from 47% in 2006, according to a survey by Synovate commissioned by personal finance author Matt Bell. 

Since consumer debt peaked in 2008, Americans have chopped $922 million from their debt, or 7.4%, according to the Federal Reserve.  Americans are reducing debt at a pace unseen in at least a decade, according to a recent Fed report.

 How do we make these changes? 

Change your words – instead of a temporary exercise in deprivation, view it as a lifestyle. 

Have goals – “I’ll pass on purchasing this item because I want to go on vacation in June.” 

Track Progress – Monitor your debts and vacation accounts.  When you see that spending smart is getting you closer to accomplishing your goal, that’ll motivate you to keep going. 

Make savings automatic – The easiest way to save is to have your savings deposited automatically from your paycheck to a savings or retirement plan. 

Make a windfall rule – When you receive a sudden increase of cash (i.e. tax refund, bonus, gift); make it a rule that these are used to paying off high-interest debt or savings.

 Source: RIS Media

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The following tips will help you make a great first impression when putting your home on the market.  People decide within 30 seconds of walking into a home whether they might want to buy it, so it is important to make a great first impression.

Curb Appeal

Spend a little money on gardening by cutting overgrown shrubs and weeds and planting new shrubs or flowers.  A bit of gardening can help paint a scene, so buyers can see their kids playing in the yard or can imagine entertaining in the back yard.

Condition of the Home

Make necessary repairs to the home before putting it on the market.  Look for cracks, damaged paint and so on to repair.  Not making repairs can cut the price of the house.

Buyer’s typically ask for $2-$3 off the price for every $1 of repairs that they perceive are needed, so it is crucial for sellers to know that, say, the roof needs to be replaced.  That way, the seller can spend the $5,000 themselves rather than face a buyer demand $10,000-$15,000 off the price of the house.

 Clean and organize the house – including drawers, cabinets & closets.  It’s a good idea to de-clutter these areas so it doesn’t appear that there isn’t enough room in the home. 

Finding the right assistance

Contact a Realtor who often provides their expertise in giving you tips to get your home ready for sale.  They also often provide a list of Handymen, Home Stagers, Painters and Roofers that can assist you in getting your home ready for sale.

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Get Organized:

Winter is a great time to organize your home so that you are ready for a fresh start once spring arrives.  Your home will seem less chaotic once everything is put in its place.

Redecorating:

Update your décor.  By changing the decorative accents in your home it can make a big difference in changing the look and feel of your home. 

Make a Plan:

If you aren’t ready to get organized or redecorate your home, take the time to make a plan.  Planning ahead for any home improvements you are going to undertake once spring arrives.  Take this time to research any projects you are planning on starting; plan your budget and even get a head start on picking out or ordering materials.