Indianapolis, IN Area Real Estate Blog: Carmel, Fishers, Geist, Noblesville, Westfield, Indiana

• What if you find major problems when you do the inspection and you don’t want the house after all?
   
• What if more than one person wants the house you want and you end up not being the highest bid and have to start over?
   
• What if there is a credit issue that has to be cleared up…no Uncle Sam is not going to say that you get a special dispensation just because the credit reporting agency made a mistake.
   
• What if you wanted to buy a foreclosure or short sale? If you haven’t already made an offer, you may have already run out of time.

1. Interest rates are still historically low but they will not stay there forever. I vividly remember buying a home in 1980 at a 14% interest rate (and that was a good rate at the time). In 1982 we were able to refinance and got our interest rate all of the way down to 10%.

2. There is a large inventory of homes on the market. In other words it is a “Buyers Market”.

3. First Time Buyers can get an $8,000 Tax Credit. This means that in most cases the government will pay you $8,000 to buy a home.

4. My Buyer Rebate will put more money in your pocket. This money is in addition to the $8,000 tax credit and is in addition to any additional concessions provided by the builder (If you purchase a newly constructed home).

5. If you have a good credit score you can get a loan with as little as 3.5% down payment (F.H.A. loan)

6. Economist very rarely agree on anything however at the present time they all seem to agree on 3 things.

• (1) Owning a home is still one of the best ways to build long term wealth.
• (2) The government is spending money that they do not have which means the government will have to borrow a lot of money in the near to intermediate future. This will without a doubt drive interest rates up.
• (3) High rates of inflation are expected in the near to intermediate future again brought on by the high rate of expected government borrowing. I paid $50,000 for the home that I purchased in 1980 and I sold it in 1985 for $84,000 (I invested $5,000 in improvements over that 5 year period) the rest of the appreciation was brought on mostly by the high rate of inflation over that 5 year period (and I did not have the advantage of a low interest rate). Low Interest Rates, Buyers Market and Future Inflationary Pressures make now the Time To Buy.
  

First-time homebuyers may soon be able to access their $8,000 federal tax credit when closing on a home through a short-term bridge loan that will cover their down-payment on FHA-backed loans.

The Department of Housing and Urban Development’s Federal Housing Administration is paving the way for first-time buyers to tap a federal tax credit of up to $8,000 for a down-payment. The announcement, made by Shaun Donovan U.S. Housing and Urban Development Secretary before several thousand real- estate agents attending the National Association of Realtors Real Estate Summit could prove to be a game changer for the sluggish housing market.

The FHA plans to allow lenders and state and local government agencies to issue short-term bridge loans of the $8,000 tax credit for buyers to use for their down-payment. Buyers can then repay the loan after getting their tax refund. Essentially it works like a tax refund advance.

“We want to enable FHA consumers to access the tax credit funds when they close on their home loans so that the cash can be used as a down-payment” Donovan said.

Details of the new program should be coming soon.

There’s a small hang-up with the IRS, which has a rule about tax payers designating someone else to get their tax refunds. But there a lot of people, including the National Association of Realtors working on this issue.

It is thought by many that this plan could spark at least 300,000 additional sales. The national Association of Home Builders estimates an additional 160,000 new home sales- 101,000 of which would be first-time buyers who will receive the credit, Another 59,000 existing homeowners will be able to buy another home because a first-time buyer purchased their home.

If HUD and the IRS can remove the down-payment hurdle it could open the flood gates. We will all be watching this very closely to see what happens.

Recently one of my past clients contacted me asking about the value of the home he had purchased in Carmel. He bought it last fall for $457,000. He called after seeing its zestimate (estimated value) on Zillow for only $275,000! This is one of the more extreme examples I’ve seen on Zillow zestimates being way off the mark.

Automated home valuation systems such as Zillow base home values off of public data much of which is incorrect or incomplete. As many of us learned in our first computer science class “garbage in, garbage out”.

If you are going to be buying a home and want an estimate of its value, contact me @ Jim@HowToBuyAHome.com. As your Realtor, I’ll not only provide an estimate, but what I based it on.

How can you get money back when purchasing a home in Carmel, Fishers, Westfield or Noblesville by using Jim Cadwalader with HowToBuyAHome.com and a 50% Commission Rebate as your Realtor?

It is very simple; the first $100,000 of the purchase price has a commission rebate of 25% and anything after that has a straight 50% commission rebate. For example, if you purchase a $400,000 home and the commission paid to the Realtor is 3.5% of the purchase price you would receive a rebate of $6,125. Let me show you how.

First $100,000 x 3.5% = $3,500 (Commission)
$3,500 x 25% = $875 (commission rebate to Buyer on 1st $100,000)

After the 1st $100,000

$300,000 (Remainder of the purchase price) x 3.5% = $10,500 (Commission)
$10,500 x 50% = $5,250 (Commission rebate on remaining $300,000)

Total rebate on $400,000 home with a 3.5% Commission:

$875 = $5,250 = $6,125.

In this Real Estate market you need to keep an eye on every penny while at the same time making sure you receive the services of an experienced Realtor throughout every step of the of the buying process. If you think this kind money should be in your pocket instead of someone else’s, give Jim Cadwalader a call.