Real Estate Investing

The U.S. Senate has approved an extension on the home buyer tax credit - and altered it so more than first-time buyers will be eligible.  According to MSNBC,

Senators agreed to extend the existing tax credit for first-time homebuyers while offering a reduced credit of up to $6,500 to repeat buyers who have owned their current homes for at least five years, said Regan Lachapelle, a spokeswoman for Senate Majority Leader Harry Reid, D-Nev.

The tax credits would be available to homebuyers who sign sales agreements by the end of April. They would have until the end of June to close on their new homes…

I couldn’t find more sources to confirm this online, so realize there are a lot of unanswered questions:

1. When is the final vote?
2. What does the House say?
3. Does the President have to approve the measure?
4. Who will now be qualified?

For me the exciting part isn’t the extension itself, it’s expanding it so other people are qualified to buy.  If my home was “parade ready” for example, it could be the boost I’d need to downsize - something I’ve been talking about for some time with my family.

Meanwhile, stocks tumbled today on the news that housing sales numbers were down.  Again, reflecting my own area that wasn’t ravaged by the bad market like some areas, it’s been a very bad year. Here’s what CNN Money.com said,

Stocks tumbled Wednesday, led by the tech-fueled Nasdaq, as a weaker-than-expected new home sales report added to questions about the strength of the economic recovery.

Let’s not get too comfortable at the notion of a quick recovery for the economy, though.  I was all Polly Sunshine about two years ago, but now… not so much.  However, it doesn’t mean that  now is not a good time to buy … it’s a GREAT time for people to get great prices on homes, good mortgage interest rates, and sellers willing to help out on closing costs.

At college orientation we were told to look to our left, then look to our right.  It was a graphic example of how few people actually graduate once they start their higher education studies.  When I moved into the dorm, perhaps my floor was different than others - or maybe it’s because I did live on campus and we had a longer college life span - but most of my neighbors actually DID finish college.

Why do I talk about this?  Because in today’s economy you can look to your left, then look to your right.  These are the people who today are having financial trouble.  You might even look in the mirror and see yourself experiencing the throes of economic despair.

Former mortgage collector Kyle writes over at Suburban Dollar that there are definitely things you should NOT do when you are behind on your bills:

The crazy thing about it is honest is always the best policy. The debt doesn’t disappear magically so it something that you are going to have to take care of. People have multiple different ways they try to cope with being behind on a bill, most of which aren’t going to do anything but hurt you. The most common ways people deal with being behind are by avoiding it, lying about it, not taking it seriously, being a jerk about it, or allowing it to affect their personal life.

This whole site about managing your suburban dollar is great.   For example, today’s post is about the hidden costs associated with buying a home,

You move in and start to arrange furniture the way you want and get things situated exactly right. Then once the couch is perfectly positioned you go to plug in the cable box only to realize there isn’t a cable, there is no wall plate, and all you have is black box that flickers. This is when the sleeper costs start to really add up.

I have a closing tomorrow with some first-time homebuyers who are just adorable.  I think I’ll give them a link to this very informative, interesting site.

I was torn today about what to write:  who cares if Wall Street talent leaves or imagine no foreclosures (it’s easy if you try).  So I’m giving you my $.02 worth on the whole “losing our best and brightest” on Wall Street if we don’t give ridiculous bonuses.  My take?  Don’t let the door hit you in the behind. So what if you leave? You’ll just go somewhere else who’s lost someone because of greed.  It’ll be like wife swap, except we won’t get to send you up in a metallic type balloon at the end.  No, you’ll get the parachute - a golden one.

Or you’ll join the millions of other people who are unemployed - join the throngs that you are partially responsible for causing job loss to.  Clearly had you been doing a better job, we wouldn’t have seen the economy dive anyway.  So again, don’t let the door hit you in the behind.  Let’s give someone else a chance and hope they don’t mess up like you did.

Someone who has ideas like how to end foreclosures.  I love this idea!

How about this. Let’s have a federal bill that states that any bank that took a bailout loan and hasn’t paid it back yet isn’t permitted to foreclose on anybody’s primary residence. In addition, bonuses for senior officers at lending institutions will be reduced by a factor tied to its foreclosure record for that year. High rate of foreclosures would mean low bonuses.  At the same time, institutions that refrain from foreclosing on people’s homes would be granted tax abatements on their profits indexed to the amount they are putting at risk by allowing homeowners to renegotiate their loans and remain in their residences.

I can only hope Stanley Bing - through his work at Fortune magazine - gets this idea out… complete with how it’s a two-way street.  No more walk-aways or jingle-mail by homeowners either.  I’ve done my part!  Spread the word!