What Homebuyers Are Really Looking For

Today’s homebuyers are searching for their perfect “dream” home. Here are the most desirable features that will attract the future homeowner. These “wants” will also help sellers who want to make best marketable improvements on their property.

Wireless Home Security - According to the NAHB, this is a feature that most tech-savvy buyers are wanting in their home. Security for a family is a top priority. Having the ability to control security by a smartphone or tablet is key. A wireless system is less costly than a hard-wired system and doesn’t require a professional to install.

Costs to install: $100-$300
50% of homebuyers desire this feature

Exterior Lighting - First impressions are lasting ones. This is surely attractive to a potential homebuyer before setting foot in the door. It is the most wanted outdoor feature with minimal costs to improve. Curb appeal is important and having exterior lighting will accent and grab their attention.

Costs: $150-$300 per fixture
90% of homebuyers desire this feature

Energy-Star Qualified Windows - Homebuyers are always looking for energy efficiency and this is a good solution to help reduce energy costs.

Costs: $270-$850 to install per window
89% of homebuyers desire this feature

Garage Storage Space - For those with a garage, there is always the need for extra storage. Easy accessibility to the home’s front door makes it a bonus to have shelving, cabinetry and places to store tools, toys or sports equipment. Having the organization will ease in locating your items. Those without a garage, may consider constructing a storage shed that conforms to home plan style, color and features.

Costs: $2000-$3000 per 350 square foot space
86% of homebuyers desire this feature

Eat-in Kitchens - Kitchens are a gathering place for breakfast in the morning and dinner at night. Families with children appreciate time around the table before school or off to work. An existing kitchen could have walls extended, added cabinetry and counter space, a breakfast bar, or a bay window to make the kitchen more desirable. Always consult a licensed professional to be sure guidelines are followed and possible improvements may be made.

Costs: $1400+ install
85% of homebuyers desire this feature

Walk-in Pantry - Walk-in pantries are always a necessity for families needing extra storage. A shelving system that keeps food and supplies organized is an added bonus to the homebuyer. Adjustable shelving will give flexibility in storage and takes away counter clutter. Having extra space to store small appliances and countertop items gives the kitchen an open feeling and less cluttered. Easy access to mops, brooms and cleaning supplies is helpful to store in a pantry.

Costs: This will vary. Consider adding cabinetry or a rolling cart that can be moved
85% of homebuyers desire this feature

Separate Laundry Room - over 55% of homebuyers are saying they would not buy a home without a separate laundry room! Space for washer and dryer, folding laundry, ironing, and keeping laundry separate from living space in the home are huge benefits. Renovation may include additional plumbing and electrical wiring, countertops, cabinetry and flooring will be based on available space and budget.

Costs: Variable
93% of homebuyers desire this feature

With the ever-changing economy and fast-paced lifestyle today, homebuyers are wanting their dream home to be more efficient, stylish and storage rich. Above all, a professional should always be the top priority in making improvements, whether as a new homebuyer or as a homeowner. Call me today to find the most professional and experienced contractor in your area and learn ways to increase your asking price when selling your home.

Tips to Successfully Restoring Your Credit after Tax Liens

A recent article from CNBC brought to light some of the common misconceptions about the realities of tax liens and the effects they have on your credit score. A tax lien, which is a serious strike that occurs when you neglect or fail to pay a tax debt, can be longer lasting than you might have expected. Here’s some information and resources that may help if you’re dealing with a tax lien on your credit report.

What is a tax lien and how does it affect my credit?

Tax liens can vary depending on your individual situation. A tax lien can be one of the worst items to appear on your credit report, and can cause your credit score to drop significantly. Essentially, when you fail to pay your tax debt on time, the government can claim all or some of your assets. It can occur at the local, state or federal level.

It’s important to remember that any tax penalty against you becomes a matter of public record, and will negatively affect your credit score. Worse still, under federal law, unpaid tax liens can remain on credit reports indefinitely, though more often, credit bureaus tend to remove them after a decade or so. Once you’ve paid off the debt and the lien is released, it will be removed from your score seven years from the date it was filed.

Because no two credit histories are alike, there is no way to state equivocally how much change removing the tax lien will have or even what an average change might be for any given scoring system. Further complicating the issue is that there are many different credit scoring systems. So, the impact on one system could be very different from another because the numeric scales are different.

Do I qualify to have the lien withdrawn from my credit score?

You qualify if:

• your tax liability has been satisfied (you’ve paid what you owe) and your lien has been released; 
• you are in compliance for the past three years in filing your individual and business returns, and; 
• you are current on your estimated tax payments and federal tax deposits. 

Even if you haven’t paid the IRS what you owe, you may be able to qualify for this program if you currently owe $25,000 or less and have entered into a direct debit installment agreement where your payments to the IRS are taken from your bank account automatically.

How do I remove a tax lien from my credit report?

First, it's important to know that unpaid tax liens, unlike other public records, may remain on your report indefinitely. Because of this, the best way to get rid of a tax lien is to pay your tax debt in full.

If your credit report shows an outdated paid tax lien, you could file a dispute with the credit bureaus, just like you can for other credit report errors. You could also dispute a tax lien on your credit report if you have proof that you should not have been subject to it in the first place.

If the debt has been paid in full, then Form 12277 is your new best friend. As CNBC outlined, there are five suggested tips to ensure the lien is removed from your account using this form:

1. Locate your state IRS field collection office. This is where you will be sending forms or asking any questions you might have.

2. Search the Internet for IRS Form 12277 and fill it out.

3. Call the IRS office and ascertain the fax number. Inform them that you will be submitting Form 12277, and call a couple of days later to confirm they have received it. The turnaround time is about 30 days. If you haven’t received a letter confirming the lien withdrawal, follow up with another call.

4. Contact the three credit bureaus, Experian.com, Equifax.com and Transunion.com, and follow their specific step-by-step instructions for submitting the withdrawal. Within 30 days you should receive updated credit reports from each of the three credit bureaus.

5. Check each report to ensure that the tax lien was expunged. If any of the three bureaus did not remove the lien, contact the bureau continuously until it’s removed.

The Road to Recovery

BrandMortgage and the Loan Star Team want you to understand how tax liens work, how they affect your credit score and what you can do to deal with them. Because the laws regarding liens can vary, it's always smart to consult the proper resources, such as the IRS, your state or local tax authority or a credit counselor. Protect your credit by paying your taxes promptly to avoid tax liens appearing on your credit report whenever possible.

Should I Buy or Rent?

Who shot Kennedy? How were the Pyramids built? Is the Oscar dress gold and white or blue? Why didn’t Seattle run the ball on their last offensive play to win the Super Bowl? These questions may never be answered. However two questions that can be answered this week are: Who is Jihadi John and should I buy or rent? Scotland Yard has solved the first question and The Loan Star team will provide a clear answer for the latter question.

For years it has been one of the biggest parts of the American Dream, Home Ownership. Historically the benefits have been so advantageous that home ownership was “a no brainer”. While the drive to be a homeowner is still strong, the housing crisis of 2008 has caused some uncertainty in the mind of some. Let’s take a look at the benefits of renting vs buying.

REASONS PEOPLE RENT:

• Flexibility. Renting allows you to explore an area before making the longer-term commitment of homeownership. Unless you are certain about a specific neighborhood, renting allows time for research and discovery.
• Career uncertainty. If you think you might need to move in the near future, or are mulling job changes that span several areas of town or are located elsewhere in the country, you might want to rent. Buying ties you down to a greater extent.
• Income uncertainty. If you expect a pay hike or cut in the near future, that can change your borrowing ability as well as impact your ability to pay a mortgage.
• Bad credit. Creating a history of on-time rental payments can help you build the sort of credit you’ll need to qualify for a mortgage.
• No maintenance expenses. When a pipe leaks, you don't head to the store; you head for the telephone and call the landlord.
• Utilities (sometimes) included. In some instances, the landlord may pay for many utilities such as water, sewer, garbage, and, in some cases, even heat and hot water.

But there is a downside, too: You may have no control over the fluctuation of your rent, a big-budget item that can change often. Long-term budgeting becomes more difficult. The Loan Star Team would recommend purchasing a home if the following benefits appeal to you:

REASONS PEOPLE BUY:

• Equity. When you pay rent, you are paying your landlord’s mortgage or adding equity to his or her bank account. However, when you have a home mortgage, you increase your degree of ownership in your home with every payment. A general rule is that if you intend to stay in your property for at least five to seven years, the costs of purchasing the home are more likely to be offset by accrued equity and increased housing value. In the event that equity in the home grows to more than a 20-to-80 percent loan-to-value ratio, you will be able to borrow against your equity in the home.
• Tax deductions. You can deduct mortgage interest as well as your property taxes. Uncle Sam doesn't give renters this bonus. Not only that, but if you meet certain requirements the IRS won't apply a "capital gains" tax on your profits from the sale of your home. You can keep the first $250,000 in profit you make when selling the home if you're single, or the first $500,000 if married. In addition, those who work from home may be eligible to take deductions for their home office and portions of utilities.
• Creative control. You like dozens of pictures on the wall? Well, hammer away -- they are your walls now. Go ahead and paint them mango! Wish you had another room? Go ahead and add one.
• Maintenance choices. If you live in a house, you can decide how to approach maintenance, either doing it yourself or picking your own contractor. If you live in a condominium or homeowners' association, you may pay a monthly fee to have maintenance work covered by the association's contractors.

Still unsure of what’s the best option for you? Ask Gary Welch or Jeff Morris for help and we’ll talk through the various scenarios and available options together. Not sure how much you qualify for?

We’ll provide you with a free, detailed credit report and choose the most creative financing available for you.  

Call us at 770-888-2232 (Gary), 770-842-3480 (Jeff) or email us at gary@loanstarteam.com or jeff@loanstarteam.com to get started!

Debt Consolidation: Truth or Myth?

We often hear the words, debt consolidation, but what does it mean? Debt consolidation is a debt management plan. You may choose to create your own plan for paying off your debt, or choose to use a third party, such as a non-profit credit counseling organization.

Here are some important tips and information truths and myths that will help you decide which management plan best suits your needs:

HOW DO YOU KNOW DEBT CONSOLIDATION IS FOR YOU?
If you have most of your balances in credit or charge cards, personal loans and collection accounts then this may be a wise choice to pursue. These types of debts are called unsecured debts. If the balances you have for example are in old violation or parking tickets, tax debts or child support/alimony arrearages, then debt consolidation plans will not help.

Before you choose debt consolidation, review your debts carefully. You may only need counseling. With the Loan Star Team we can help you make your own plan to pay off your debt. Homeowners may consider refinancing as an option to reduce high interest rate loans.

TRUTH: DEBT CONSOLIDATION IS NOT BANKRUPTCY.
These terms can cause confusion. Debts will always be debts until all are paid in full. Bankruptcy is a discharge or settlement for debts. While debt consolidation payment plans seem like a solution, your credit report will be affected. If a payment plan to pay off your credit card is lower than what you normally pay each month, it may show creditors that you have trouble paying your bills.

TRUTH: DEBT CONSOLIDATION CAN WORK BECAUSE IT IS SIMPLE AND STEADY.
For those that need the discipline of a never changing monthly payment, then debt consolidation is the answer. You payment will be the same each month to each of your creditors until all your debts are paid in full. You will never need to worry about how much to pay-it is just that simple. One thing to remember…as your monthly payment is lowered, it will expand the time it will take to pay off your debts.

MYTH: YOU CAN CONTINUE TO CHARGE.
When you choose debt consolidation, you will need to be charge-free until all the debts are paid. This is a true adjustment for most accustomed to using lots of plastic.

TRUTH: YOU CAN DO THIS ON YOUR OWN.
At first, it may seem difficult, but you can do it. It is not easy to change your habits, but determination will work in your favor, financially and mentally. Ask your creditors for a reduction in rates, stop the frequent charging, revisit your budget and see exactly how much you can afford to spend. Make all efforts to be diligent in saving and making payments on time. Your credit report will be affected positively and you will be more confident in securing a loan for your home needs.

Get advice from the professionals before considering debt consolidation with agencies. The Loan Star Team is at your doorstep to provide this guidance and counseling. With the lowest interest rates of all times, consider refinancing to a lower mortgage rate and pay off your debt faster!

We provide you with professional help for your refinancing and future home loan needs. Call us at 770-888-2232 (Gary), 770-842-3480 (Jeff) or email us at gary@loanstarteam.com or jeff@loanstarteam.com to get started!

Filing Homestead Exemption Is Near

The beginning of a new year reminds us that the tax season is soon approaching. As a first time homebuyer or if you recently purchased a new property, you have a tremendous tax advantage and may be eligible for what is known as Homestead Exemption. The term homestead exemption can refer to exemptions from property tax that homeowners can claim. It can also refer to homestead protection, which protects a person's primary residence in the case of financial hardship, such as the death of a spouse.

Homestead Exemption laws are not the same in all states. Some states provide automatic protection under the law, while other states require the filing of a claim for Homestead Exemption. In Georgia, it is required that you file a claim for Homestead Exemption. An important note is that your registration of all vehicles and filing of your Georgia and Federal State income taxes must reflect your primary residence address. A claim for Homestead Exemption may not be made on any rental or vacant property, or more than one property. Interestingly enough, as a homeowner, you may lose your right to Homestead Exemption if you abandon the property or if you should occupy a different primary residence than the one previously claimed.

If you have occupied your new residence on January 1st, you will need to file in person, online or by mail at the County Courthouse or Tax Commissioners Office. The amounts of exemption will vary for each county and filing procedures may be different. Typically, filing applications in Georgia is January 2 through March 31.

To make it simple for those filing for the first time, here are the Tax Commissioners Offices for filing your claim:

CHEROKEE COUNTY – 678-493-6120
http://qpublic.net/ga/cherokee/exemptions.html

CLAYTON COUNTY – 770-477-3311
http://www.claytoncountyga.gov/departments/tax-commissioner/exemptions.aspx

COBB COUNTY – 770-528-8600
http://www.cobbtax.org/property/exemptioninformation

DEKALB COUNTY – 404-298-4000
http://taxcommissioner.dekalbcountyga.gov/TaxCommissioner/tc-home.html

DOUGLAS COUNTY – 770-920-7272
http://www.douglastaxcommissioner.net/Exemptions_31XR.html

FAYETTE COUNTY – 770-461-3652
https://www.fayettecountytaxcomm.com/subpages/Homestead.asp

FORSYTH COUNTY – 770-781-2106
https://www.forsythco.com/DeptPage.asp?DeptID=175&PageID=1681

FULTON COUNTY – 404-612-6440
http://www.qpublic.net/ga/fulton/homestead_inst.html

GWINNETT COUNTY – 770-822-8800
http://gwinnetttaxcommissioner.manatron.com/Tabs/Property/HomesteadExemption.aspx

HENRY COUNTY – 770-288-8180
http://www.co.henry.ga.us/taxcommissioner/propertytaxexemptions.shtml

PAULDING COUNTY – 770-443-7606
http://www.paulding.gov/index.aspx?NID=210

For more information, please contact the Loan Star Team of Gary and Jeff at gary@loanstarteam.com or jeff@loanstarteam.com. Stay connected and follow us on LinkedIn!

Tax Benefits to Owning a Home

There’s certainly no better place than home and even more so when it comes to tax time each year. Below are 8 financial advantages to owning a home.

1. You build equity in your home each month.

Equity in a home is the amount of money you can sell your home minus what you still owe on your mortgage. Every time you make a mortgage payment, a portion of that goes toward paying down your principal. The way mortgages work is that the principal portion of your payment increases slightly every month year after year. It’s lowest on your first payment and highest on your last payment. The reduction in your mortgage each month, increases the equity in your home!

2. Homeownership can increase your wealth.

Buying a home can be a very savvy move and great financial investment, only when you purchase a home you can afford. In 2015, the idea of sticking to a home you can afford to gradually build wealth is a “rule” that just happens to be new and old at the same time.

3. Tax deduction benefits.

There are a few tax deductions that can help alleviate some of the tax burdens which may be associated with owning a home. Below are just a few deductions you should be taking.

Mortgage deduction:Homeowners can deduct the interest they pay, since often times interest is the largest component in their payment.

Property tax:Real estate property taxes paid on your primary residence and a vacation home are fully deductible for income tax purposes.

Closing costs (when applicable):Homebuyers may pay origination fees that are charged by the lender when you apply for your home loan. The first year you purchase your home, you may deduct these fees, regardless if the origination fee was paid by you or the lender. The savings can be high since origination fees may be 1%, or higher!

To find out what your tax savings are after you purchase your home, use this handy mortgage calculator to find out your deductions and your savings!

4. Home Equity Lines are deductible.

In addition to your mortgage interest, you may also deduct your equity lines of credit. This allows you to shift your credit card debts to your home equity loan, pay a lower interest rate than the credit card interest rates, and get a deduction on the interest as well.

5. Buying is cheaper than renting.

Although the cost of renting may be cheaper the first year you own your home, over time, the interest you pay will eventually decrease and be lower than the rent you would have been paying. More importantly, you are actually building equity in a home you own and not spending all of your hard earned money on rent. So, instead of paying off your landlord’s home or building, you can pay off your own!

6. Receive a capital gains exclusion.

If you buy a home to live in as your primary residence for more than two years then you will qualify. When you sell, you can keep profits up to $250,000 if you are single, or $500,000 if you are married, and not owe any capital gains taxes. If you purchased your home anytime prior to 2003, chances are it has appreciated in value and this tax benefit will come in very handy.

7. A mortgage is similar to a savings account.

By making monthly payments on your mortgage, you are paying the principal balance down and building more and more equity in your home. In a sense, you are forced to save this money in a separate account, and when it’s time to sell your home, this equity becomes yours.

8. Unforseen circumstances.

A partial exclusion can be claimed if the sale was prompted by residential damage from a natural or man-made disaster or the property was "involuntarily converted," for example, taken by a local government under eminent domain law. This may include:

• Death 
• Divorce or separation 
• Job loss that qualifies for unemployment 
• Employment changes that makes it difficult to make monthly payments and basic living expenses 
• Multiple births from same pregnancy

To find out if you qualify, please consult with your mortgage banker.

Buying a home in order to build equity is one of the main financial reasons buyers jump into the market. As we have seen above, there are quite a few advantages to owning a home. That is why many homeowners who have taken out a mortgage in order to buy do so in anticipation of the tax breaks that come with homeownership. Depending on your tax bracket, a first-time purchaser's 1040 tax deductions can heavily subsidize many of the expenses you have poured into your new home.

While a home is a good investment, it’s best to weigh the pros and cons of both buying and renting, and how cost effective these will be. Along with the joy of painting, plumbing and yard work, you now have some new tax considerations when purchasing a home.

If you are thinking about purchasing a new home, resale, or investment property, it’s important that you get pre-qualified before you start the home buying search.

To learn more or to get pre-qualified, contact the Loan Star Team of Gary or Jeff at gary@loanstarteam.com or jeff@loanstarteam.com.

Home Trends and Predictions in 2015

The new year brings resolutions and predictions. Check out The Home Buying Institute’s Five Real Estate Predictions to Watch in 2015. Get an insider’s look at the prediction and how it relates to real estate housing, mortgage lending, and home buyers buying. Are you betting with or against these predictions?

Prediction 1: Home values will continue rising, but more slowly than 2014.There is no such thing as a “the” housing market when it comes to pricing trends. It is a local thing. We understand that to be true as we view housing markets throughout the country. In states or cities where population is increasing and job opportunities are plentiful, housing would be more active than parts of our country that are depressed or deficient in employment openings.

CoreLogic, a financial data firm, published its annual HPI Forecast that predicts monthly home price gains and annual pricing trends stated it is expected that home prices will rise from July 2014 to July 2015 by 5.7%. July is the time for families with school age children who make enrollment a priority when relocating. Following winter break is another time that home demands may be on the rise and may precipitate price gains.

Generally speaking the consensus is that residential property values will continue rising in 2015 but at a slower pace than what has been seen in the previous 12 months.

Prediction 2: Double-digit gains will be limited to California and the Southwest.According to a real estate information company, Zillow, it believes that the rapid pricing gain will be in California and the Southwest. Their data is stating that double digit increases will most likely be in only a select few cities in California and the Southwest.

A map featured in this article indicates cities that may see a double-digit price gain include ten cities in California, Reno and Las Vegas, Nevada. Zillow uses their predictions based on their own pricing models, housing trends, sales prices, and other data.

Prediction 3: Mortgage Rates should remain low through first half of 2015.
In the latest comments from the Federal Reserve earlier this month, the Fed indicated they plan on keeping rates relatively low for the first part of 2015. Rates today resemble the historic rates of Dec of 2007 for the 30 year conventional fixed rate. Unlike 2007 though, the Jumbo rates are much lower today than seven years ago. Additionally government rates are as low as I have seen them in my 23 year mortgage career. Do not rule out some rate volatility as both the stock market and bond market move now on predictions, speculation, and emotion as opposed to logic and data. But overall rates will assist in making home buying affordable in all price points. This is a nice Christmas present from the Fed as we begin 2015.

Prediction 4: Foreclosures will continue to decline, as a percentage of total inventory.
When the housing market crashed, activity of home foreclosures was on the rise and continued to remain so over the last few years. Soon foreclosures declined which brought back confidence to the real estate market, both to buyers and sellers. With competitive, low mortgage rates, buyers anticipated the joys of home ownership. Distressed properties were fewer and values of homes were appraised closer to their true value. This confidence was uplifting to the real estate market and mortgage lenders.

The foreclosure market has not completely disappeared, and according to Realty Trac, a company that monitors foreclosure activity, states that we will not “cross the finish line until early 2015”. Many analysts are in agreement with this prediction. A decline in foreclosure activity will help solidify home prices, normalize inventory, and allow more move up buyers to help boost the housing market, as well as the overall economy.

Prediction 5: Mortgages Will Be Easier to Obtain.
In July, the Federal Reserve released a report that stated mortgage lenders are “relaxing their standards” mostly in debt ratios and credit scores. Lenders are allowing for credit scores to be lower and debt ratios to be higher for borrowers. The reason for this “relaxation” is due to the reduction in loan applications. Lenders needed to increase the volume of borrowers, and found the best solution was to loosen their lending standards.

In Vegas, the house always wins eventually. In 2015, the Loan StarTeam sees homebuyers winning. There is a perfect formula in play here: reasonable and rational appreciation of homes, affordability with low rates merged with a renewed sense of consumer confidence, and lower unemployment numbers. 2015 could be the best time for buying and selling real estate in the last seven years. Here is to 2015, a year we all win in the housing market.