Patricia BeckWill I have to repay the first time home buyer tax credit if I sell my home?
Many homeowners who purchased a home in Colorado Springs between 2009 and 2010 benefited from the most recent tax credit of $8,000 ($6,500 for long-time residents) and those who were active duty in the military, had a one year extension (April 30, 2011). A lot can change in a couple of years and many homeowners have questions about repayment of the tax credit if they sell their home prior to the 36-month requiremen
t.
To benefit from the tax credit, first time home buyers must live in the home as their principal residence for at least three years. If the homeowner does not occupy the property as a principal residence for at least three years, then the credit may have to be repaid to the IRS. Note: First time home buyers who are serving actively in the military and are required to relocate are exempt from this requirement.
Examples of situations when the property is no longer your primary residence may include selling or foreclosing on the home, conveying the property to a spouse as a result of divorce, or converting the home to a rental property or second home.
In the situation of a divorce, if the property is transferred to a spouse in the divorce decree, the tax credit should not have to be repaid unless the property discontinues being the primary residence of the spouse whom the house was transferred to within that 3-year time frame. In the event the home does stop being a primary residence, the tax credit would have to be repaid by the spouse whom the house was transferred to.
If a homeowner does proceed to sell their home prior to the 36-month window, the amount of the tax credit required to be repaid will depend on whether or not the homeowner receives any net proceeds as a result of the sale. If there is a gain, the repayment amount is figured on the amount of the gain. For example, if the homeowner sells the home to someone who is not related to him or her and gains $5,000 from the sale, the home owner should only have to repay $5,000 of the $8,000 tax credit. If the homeowner does not have a gain from the sale, the homeowner should not have to repay the credit.
The calculations can be figured on IRS Form 5405. Keep in mind that the basis of the property is reduced by the amount of the credit on the form to account for the tax credit received by the homeowner. How is the credit repayed? It is reflected as an additional tax on the return for the year the home stopped being your primary residence.
Homeowners who received the $7,500 first time home buyer tax credit and sell their home, may have to pay the remaining annual installments depending on whether there is a gain or loss as a result of the sale. For more information and answers to questions about the $7,500 tax credit for homes purchased in 2008, please view the publication on IRS.gov
For more information and answers to questions about the most recent 2009 or 2010 tax credit please go to the IRS website: First-Time Homebuyer Credit Questions and Answers: Repaying the Credit
It can be complicated and every homeowner’s situation is different so it is best to consult with the IRS directly at 1-800-829-1040 or their website, www.IRS.gov for more information.
Contact Patricia Beck at 719-660-9058 if you would like assistance in selling your home in Colorado Springs
5 things you need to know before offering on a short sale
Buyers now are aware that there isn’t anything short about a short sale when it comes to waiting for bank approval. Many banks have taken steps to expedite the process but let’s face it, short sales take time. Buyers who have flexible living arrangements and have time to wait have more of an advantage over buyers who are in a time crunch to find a place to live. Buyers who pursue short sales should work with a real estate agent in Colorado Springs that understands short sales. Before submitting an offer on a short sale property, the buyer’s agent should find out more information regarding the short sale so the buyer can make an informed decision whether to proceed with an offer or pursue another property. Below are a few questions buyers should get an answer to.
1.) How many mortgages are on the property? If there is one mortgage then the short sale may not take as long as a short sale where two mortgages have to be negotiated by the listing agent. If there are two mortgages and they are with different banks, that can further lengthen the short sale process. The second lien holder may not be cooperative and cause delays.
2.) Are there any other liens? It is not unusual for the seller to have additional liens on the property such as a tax lien, lien from a contractor that completed work on the property, or lien from a
credit card company. If there are additional liens, has the seller worked with the lien holder to come to an agreement so the listing agent can proceed with the short sale? Your Colorado Springs real estate agent should find out who the other lien holder is and the amount of the lien from the listing agent. In this situation, the outcome of the short sale is dependent on all parties coming to an agreement so the short sale can successfully close instead of going into foreclosure.
3.) How far along in the short sale process is the listing agent at with the bank? If the short sale is in the very beginning stages of the process, buyers can expect it to take longer. Does the bank have all of the required documentation from the homeowner and is it up to date? Has a negotiator been assigned to the file? Is the seller responsive when the bank requests additional documentation? How many sellers are involved and are they out of state? If it’s a divorce situation, are the sellers collaborating with the listing agent and the bank? If there was a previous buyer under contract, the short sale process may be further along with the bank. Another indicator of how long the short sale will take is to find out if an appraisal has been completed yet. There are many more factors your real estate agent can look into regarding the short sale and that is why you want to make sure and work with an agent that is knowledgeable with short sales in Colorado Springs.
4.) Is it a VA or FHA short sale? If the mortgage being serviced by the bank is a VA or FHA backed mortgage loan, additional delays may occur since the bank now has to deal with the Veteran’s Administration or Department of Housing and Urban Development for short sale approval. VA and FHA will have their own requirements and how much they will accept for the purchase price of the home in order to approve the short sale.
5.) Is the listing agent experienced with short sale transactions? Short sale transactions are heavily impacted by the listing agent and his or her level of competency when it comes to dealing with short sales. If the listing agent has not worked with many short sales or does not communicate frequently with the buyer’s agent regarding the status of the short sale, that is not a good sign. Is the agent submitting all offers to the bank or one offer at a time? Is the agent a Certified Distressed Property Expert (CDPE)? If so, that is a positive indicator and something buyers should even consider when choosing a buyer’s agent to assist them with the purchase of a short sale.
Short sales can be a long process but if all parties communicate and are responsive to the bank, the short sale can move along more smoothly. There are many unknowns with short sales but getting answers answers to some questions up front can help buyers decide if the short sale is worth pursuing, considering their situation and timeline.
If you need assistance with a Short Sale in Colorado Springs, contact Patricia Beck, your Colorado Springs Realtor® at 719-660-9058
Lorson Ranch – New homes in Colorado Springs
Home buyers looking for a new home near military installments of Colorado Springs, may want to consider Lorson Ranch. Lorson Ranch is located east of Marksheffel Rd, off of Fontaine Blvd in the Fountain Valley area. Lorson Ranch is near Fort Carson Army Base, Shriever Air Force Base, and Peterson Air Force Base. The subdivision is part of Widefield School District 3.
Home builders in the area include Aspen View Homes, Saint Aubyn Homes, Windsor Ridge Homes, and Classic Homes. Pricing in the area starts in the low 200′s and a variety of floor plans are available through each home builder. Home buyers looking to get more bang for their buck will appreciate what the builders have to offer in Lorson Ranch. I was surprised how many features builders were including in all of their homes as “standard” finishes. Some of the standards home builders are including in their homes at Lorson Ranch are listed below:
* 9′ Ceilings
* Granite Slab Kitchen Counters
* 42″ kitchen cabinets
* Granite Slab Bathroom Counters
* Tile flooring in baths and laundry rooms
* Hardwood flooring
* Oil rubbed bronze hardware
* Stair cases with iron balusters
* 5 piece master bathrooms
* Finished basements
* Stucco exterior
* Fireplace
* Refrigerator included in the kitchen
* Tubs and showers with tile surround
Each builder in Lorson Ran
ch varies with the standards they provide but there are many similarities between the builders with the finishes they offer at no extra charge to the buyer.
Unlike other new home communities in Colorado Springs where builders only landscape the front yard, all of the builders in Lorson Ranch are providing landscaping for the front and backyard (including fencing) which is a major benefit to home buyers looking for all landscaping to be completed before move-in.
Builders can change pricing and features at any time so make sure to have your Colorado Springs Real Estate Agent find out the most recent pricing and information for Lorson Ranch once you are ready to purchase a home.
Buyers looking to purchase a new home in Colorado Springs have an advantage with the low interest rates and new home builders including so many features as standard finishes in their homes. What a great opportunity!
Contact me about buying a new home in Colorado Springs at 719-660-9058
Search for homes in Colorado Springs
Real Estate Market Report – Sierra Ridge – April 2012
Colorado Springs Real Estate – Market Report for Sierra Ridge – April 2012
Average List Price: $277,650
Average Days on Market (active listings): 72 days
Absorption Rate: .83%
List Price vs. Sale Price Ratio: 96.7%
Bank owned properties in the area: 1 (currently pending)
Short sale properties in the area: 1 (currently under contract)
Contact Colorado Springs Real Estate Agent, Patricia Beck at 719-660-9058 for more information about homes in the Sierra Ridge subdivision of Colorado Springs.
Colorado Springs Real Estate information and services
*Information gathered from the Pikes Peak MLS is deemed reliable but not guaranteed
El Paso County Home Sales for April 2012
Home sales increased by 8.4% in El Paso County for the month of April when compared to March and sales were 4.8% higher when compared to April 2011.
There were 36 additional single family home sales in April 2012 when compared to April 2011. There were also an additional 1,197 single family homes for sale in April 2011. Inventory levels continue to remain much lower than they were around this time last year in Colorado Springs.
Compared to the previous month of March, both the average sales price ($221,125) and the median sales price ($192,525) increased. Last April, the average sales price was $215,466 and the median sales price was $184,950. Buyers are taking advantage of the opportunity to purchase a home with the current low interest rates and home prices.
**Information gathered from the Pikes Peak MLS is deemed reliable but not guaranteed
Also Read: El Paso County Inventory Statistics for April 2012
Search for homes in Colorado Springs
For further information on available Homes in Colorado Springs contact your Colorado Springs Real Estate Agent, Patricia Beck.
El Paso County Inventory Statistics for April 2012
Home inventory levels have decreased by 7.7% for the month of April when compared to six months ago. Compared to the previous month of March, there was a very slight increase in single family homes for sale.
In April 2011, single family Inventory in the Pikes Peak MLS was considerably higher. Compared to this time last year, months of inventory for Colorado Springs is much lower.
For April, Single Family Home Inventory in the Pikes Peak MLS was sitting at 4.3 months (compared to 6.3 months in March). Looking at statistics over the past six months, we are at 5.3 months inventory. Homes in the lower price ranges continue to go under contract quickly and home buyers who hesitate on submitting an offer may lose the opportunity to another buyer in Colorado Springs.
The months of inventory has improved considerably in Colorado Springs. As long as the inventory levels remain at these levels and sales remain steady, the market will continue to improve. There is a balanced market in Colorado Springs when inventory sits at 6 months. As a result of low home inventory, the real estate market in Colorado Springs has shifted to a seller’s market.
**Information gathered from the Pikes Peak MLS is deemed reliable but not guaranteed
Also Read: El Paso County Home Sales for April 2012
Search for homes in Colorado Springs
For more information on Colorado Springs Real Estate or the Colorado Springs Area contact me or visit my website.
The real estate market in Colorado Springs is changing
The inventory in Colorado Springs has dropped considerably compared to previous years. There are around 3,000 single family homes actively for sale right now in El Paso County and less than 1,500 homes for sale below $250,000. There are also 1,200 fewer single family homes on the market than this time last year. Buyers recognize it is a good time to purchase a home in Colorado Springs with the low interest rates and competitive home prices. Pair low interest rates with low inventory levels and you have the market leaning toward sellers right now in Colorado Springs.
Buyers who find a home they love do not have much time to “think about it” and if they do take too long to make a decision, they will find themselves losing their dream home to someone else. There are less than 1,000 single family homes for sale below $200,000 so the housing market is very competitive for buyers looking to purchase in that price range right now!
Buyers looking for a bargain may gravitate toward distressed properties but need to understand they may encounter a multiple offer situation if they pursue a bank owned property. Many bank owned properties with multiple offers are selling above the asking price.
It is not uncommon for home sellers to be less flexible in our current real estate market either. Sellers know the home inventory is low and understand they can find another buyer for their home if the buyer they are working with is unreasonable. Buyers understand the market is competitive so we are seeing many of them ask for fewer seller concessions as well.
If you are considering putting your home up for sale, now would be the right time to do it! Many home sellers are receiving multiple offers in Colorado Springs. Start interviewing real estate agents in Colorado Springs today!
If you are looking to purchase a home in Colorado Springs, choose a real estate agent who understands the current real estate market and knows how to work with the various types of properties for sale because they are not all the same!
Contact Patricia Beck, about buying or selling a home in Colorado Springs at 719-660-9058
Colorado Springs Home Sellers, have checked the info in the MLS?
I was showing a home to a buyer recently and the seller happened to be present. I mentioned to the homeowner that one of the streets leading to her home was missing from the directions that were listed in the MLS. Since she had not reviewed the listing information for her home, she requested I leave my MLS sheet with her to review so she could inform her agent of any additional corrections that needed to be made.
Sellers should review all of the information posted about their home for sale in Colorado Springs to ensure everything is accurate. If there is incorrect data about the home in the MLS, it may affect the sale of their home. For example, if the agent does not indicate the home has central A/C, buyers who are looking to purchase a home that has air conditioning may dismiss it. Sellers should request their real estate agent in Colorado Springs provide them with a hard copy or link to the MLS information for the home. Below is a list of a few items home sellers should review:
Directions: Are the directions to your home accurate? Double check that the directions listed are the easiest/best way to get to your home.
Property Taxes: Did the agent post the correct and most recent taxes for the property?
Schools: The school district including the Grade, Middle, and High Schools should be listed, are they correct?
Home specs: Review the description for siding, windows, basement type, etc… For example, if you have a walk-out basement, make sure it is properly noted in the MLS.
Homeowner’s Association: Is the HOA contact information correct? Are the HOA dues listed in the MLS current (amount and frequency)? Did the real estate agent indicate what the HOA dues cover or include?
Home features and amenities: Ensure all of the important features and amenities of your home are included and notify your agent if something is missing or inaccurate.
Inclusions/Exclusions: Are all of the listed inclusions and exclusions correct? This is one common area of misunderstanding between buyers and sellers so make sure everything is clearly stated. If you have two fridges and one is excluded, make sure you are specific.
Flooring: Did the agent state you had hardwood flooring but it is actually wood laminate? Do you have linoleum in the entry but the agent indicated it was tile?
Photos: Are any of the photos mislabeled or blurry? Did the agent include enough photos of your home? Many buyers automatically disregard a home if there are no photos or if there is only an exterior photo of the home. They often assume something is wrong with the interior and that is why the agent didn’t post photos.
Property Description: Did the real estate agent highlight important features you wanted to include about your home? Do you notice any spelling errors? Typos are very common in the MLS and you do not want your home listing to have any!
QR Code: If there is a QR code on the for sale sign or property flyer, scan it with your smart phone and make sure the web browser takes you to information about your home and not another!
Many Colorado Springs Real Estate Agents will provide property flyers for buyers who drive by the For Sale sign. Don’t assume all of the information is correct, review the property flyer for your home as well!
Accurate and complete information about your home in the MLS (including nice photos) brings you one step closer to successfully selling your home in Colorado Springs!
Contact Patricia Beck at 719-660-9058 if you would like assistance in selling your home in Colorado Springs
One thing sellers need to know about Short Sales in Colorado Springs
There is no doubt about it, short sales can be difficult when you are the owner. The banks require an enormous amount of information and paperwork from the seller and a short sale transaction can take time to complete. When you reach the end, as a seller, you are happy the short sale is closed and completed. Then one day, you go check your account online with the bank and still see the mortgage debt. Panic sets in and you start wondering if the bank really did approve/accept the short sale as a full payment.
As you have already experienced when short selling your home, bank processes take time, a lot of time. For example, if you had an FHA loan that was serviced by ABC bank, there is a claim that has to be completed between FHA and the bank. The debt will continue to show in your mortgage balance if you check your account until FHA pays the claim, typically 6-12 months. Keep in mind, it can take as little as 90 days or as long as 18 months for things to get squared away.
Everyone’s situation is different so if you are unsure what is going on with the debt still showing up on your account, just pick up the phone and call the bank or the real estate agent who assisted you in the short sale of your Colorado Springs home.
Contact Patricia Beck at 719-660-9058 if you would like assistance in selling your home in Colorado Springs
Tastefully updated home for sale in Colorado Springs!
View this home on YouTube
This lovely home is warm, inviting, and bright! It is located on a private lot and cul-de-sac, surrounded by mature trees. Hardwood flooring and vaulted ceilings greet you as you enter the living room. The kitchen has been updated with stainless steel appliances, tile flooring and backsplash. A spiral staircase leads up to the master bedroom where you can relax while listening to the sound of Shooks Run creek. The master bedroom is a loft overlooking the living room with an adjoining bathroom and his & her closets. The master bathroom has a tiled shower, tile flooring, and double sinks.
The finished basement has new carpet, extra storage space, a family room with built in shelving, a bedroom, and laundry room. Stay cool all summer long with central air and ceiling fans. The backyard is fully fenced and has a large deck . Conveniently located minutes from schools, downtown Colorado Springs, and Memorial hospital. The Little Market & Deli is right in the neighborhood! The playground is also just a few steps from your front door! This home has been well cared for and truly shows pride of ownership!
Additional information/features:
- Detached 1-car garage
- Finished Basement
- Low-E Vinyl Windows
- Stainless Steel Appliances
- Central Air
- Year built : 1902
- Covered front porch
- Hardwood flooring
- Ceiling Fans
- Aprox. 12 ft new sewer line
- Newer interior/exterior paint
- Linen Closet
- Furnace & Water Heater 2001
- 10×16 Storage Shed
- Auto Sprinklers System
- Fenced Back Yard
- School District 11
- MLS# 734266
Contact me about buying a new home in Colorado Springs at 719-660-9058
Search for homes in Colorado Springs
