Tax Benefits in Owning a Home

Before a home owner curses the troubled housing market, he or she should take solace in the U.S. tax code, which makes buying a home a good deal for almost everyone.

Here are some reasons why:

• Mortgage interest deductions- in some cases including mortgage insurance premiums, reduce home owners' tax liability by reducing income.The deductions can be used on both first and second home mortgages.



• Interest on home equity loans are also deductible.



• Profits from the sale of a home can potentially be tax free* (* when a primary residence is sold the profits are tax free up to $250,000 for single home owners or $500,000 for married home owners filing. Any profit above this usually is a long term capital gain at 15%- less if the seller's tax rate is less than 20 %.

Tax laws change, please contact your tax attorney or accountant for specific tax questions.

How to raise your Credit score.

Thinking about buying that first home? Check your credit score. There are 5 categories that can effect your credit score.


Here are some tips to help raise that score.

1. Pay your bills on time. 35% of your score is dependent on your payment history. Make a plan-set up auto pay and maintain a budget.






2. Keep credit balances at 30 % of your credit limit, or lower.






3. Don't cancel credit cards to up your score. about 15% of your score is based on long you held your card. A card you have had a few years is better than a new one. Be sure to have a credit card, as no credit history can also throw off a score.






4. Don't apply for too many credit cards. about 10% of your score is determined by how many times lenders request your credit report. Don't apply for too many cards.






5. Watch the kind of credit you use. about 10% of your score is based on the types of credit you are using. Secured (car loans and mortgages) or unsecured (student loans, credit cards) Unsecured loans are considered riskier on your report.

information from USAA Magazine

What is a Short Sale?

Among the real estate questions I am getting beside "How is the Real Estate Market?" is what is a Short Sale? By definition, a short sale is a work out program that allows borrrowers to sell their property, even if the proceeds are less than the loan payoff amount due to low property value. The lender will usually agree to this arrangement if they feel that it will result in a lesser loss than going thru Foreclosure, or deed-in -lieu, and is faster and less expensive.

Short Sale, Foreclosure and Deed-in-Lieu can all have a significant impact on a homeowners credit. How banks handle each of these scenerios can be different. Be sure to consult your lender or a real estate attorney to investigate all options.

Call me to answer your questions on Short sales, including where to get started or any other real estate questions you may have.

Market Update in the Twin Cities

August showed a 15 percent increase in pended sales year -over-year for the second consecutive month in the Twins Cities housing market. (Pended sales are accepted offers on properties that have not yet closed ). The good news is that the number of homes for sale in the 13 county metro area is down 9.2 % from August of last year. This trend is what we need to help stabilize home prices.

According to the Minneapolis Area Association of Realtors, we saw in September large increases in activity in the lower price ranges. This is likely the result of sales in foreclosure and short sale properties. With the lower interest rates and price pressures it makes affordability is 19% ahead of last year at this time.

New Carbon Monoxide Detector Law

A new State law requires carbon monoxide detectors in all single family homes.


What is Carbon Monoxide?

it is a toxic, colorless and odorless gas that interfers with the delivery of oxygen throughout the body.

Sources of Carbon Monoxide:

• gas water heaters


• woodstoves and fireplaces


• unvented kerosene and gas space heaters


• leaking chimney and furnaces
• gas stoves


• exhaust from cars in attached garages


• back drafting from furnances

Symptoms:

• flu-like symptoms- headache, dizziness, weakness and fatigue.


• at higher levels- confusion, disorientation, impaired vision, and coordination, brain damage, coma, and death.

Types of Detectors:

• varieties include plug in and battery-operated. Make sure it meet Underwriters Laboratories Safety 2034.

Place each detector within 10 feet of each room used for sleeping.