Featured Home of the Day

1358 Francesca Dr ~ Best Kept Secret in Hazelwood Subdivision

Spacious Kitchen

Screened Deck With Extension



Eat In Area







Large Master Suite



Great Room with Vaulted Ceilings











Priced at only $167,000
3 Bedroom
2 Bath
1863 Sq Ft
Screened Deck
Bonus Room
No Rear Neighbors

Priced to sell quickly!!!!
Call me to see this home.
931-206-8551  Deb Wilson, Realtor

Feature Home of the Day

$139,900  Priced Reduced    Best Deal in the Neighborhood!!!! 

Welcome to 1275 Meredith Way

3 Bedroom,2 Bath

Bonus Room

Large Master Bedroom

Fenced Back Yard

Featured Home of the Day

Lot 306
Fields of Northmeade

Clarksville TN 37040

• 2104 sq ft
• 3 bedroom
• 2.5 bath
• Huge Bonus Room
• Real Hardwood in Foyer, Great Room, Dining Room and Hallway
• Tile in all wet areas.

$189,500

 Click to View More Photos of this Great Home

Tax Tips for Homeowners Looking Ahead to 2010 Returns

Article From HouseLogic.com
By: Mike DeSenne
Published: February 22, 2010


From energy tax credits to vacation home deductions, check out these tax tips for homeowners looking ahead to 2010 returns.

Tax planning for homeowners should start well in advance of the April 15 filing deadline each year. If you delay until the last minute, it might be too late to maximize tax credits and tax deductions. These tax tips for homeowners looking ahead to 2010 returns explain some of the things you can do now that'll pay off later on your 1040.

Take a day to formulate a tax plan for the year. Depending on your circumstances, you might want to take advantage of energy tax credits or max out your vacation home deductions. The "What's New in 2010" section of IRS Publication 17 (http://www.irs.gov/publications/p17/index.html) offers a sneak peek at tax changes that might affect homeowners.

Claim remaining energy tax credits

It's time to get cracking if you didn't exhaust your full allotment of residential energy tax credits (http://www.houselogic.com/articles/claim-your-residential-energy-tax-credits/) during 2009. Although tax credits for big projects like residential wind turbines and solar energy systems have no upper limit and are good through 2016, energy tax credits capped at $1,500 expire at the end of 2010. Eligible capped projects include new windows and doors, insulation, roofing, water heaters, HVAC, and biomass stoves.

Here's how it works with capped federal credits: You can earn energy tax credits worth 30% of the cost of qualifying improvements (http://www.energystar.gov/index.cfm?c=tax_credits.tx_index), but the total tax credits can't exceed $1,500 combined for 2009 and 2010. So if you only took, say, $700 worth of capped energy credits on your 2009 tax return, you're still due for another $800 in credits in 2010. Some projects include the cost of installation--a furnace, for example--while others, such as insulation, are limited to the cost of materials.

Max out tax benefits of a vacation home

Use a vacation home wisely, and it'll provide a break from taxes as well as the hustle and bustle of everyday life. The rules on tax deductions for vacation homes (http://www.houselogic.com/articles/tax-deductions-vacation-homes/) can get a bit tricky, but understanding and adhering to them can yield many happy tax returns.

If your vacation home is truly a vacation home meant for your personal enjoyment, as opposed to a rental-only income property, you can usually deduct mortgage interest and real estate taxes, just as you would on your main home. You can even rent out the home for up to 14 days during the year without getting taxed on the rental income. Not bad.

Now, let's say you want to rent out your vacation home for more than 14 days in 2010, but also use it yourself from time to time. To maximize the tax benefits, you need to keep tabs on how many days you use your vacation home. By restricting your annual personal use to fewer than 15 days (or 10% of total rental days, whichever is greater), you can treat your vacation home as a rental-only income property for tax purposes.

Why is that a big deal? In addition to mortgage interest and real estate taxes, rental-only income properties are eligible for a slew of other tax deductions for everything from utilities and condo fees to housecleaning and repairs. Deductions are limited once personal use exceeds 14 days (or 10% of total rental days), so get out your calendar now to strategically plot your vacations.

Take advantage of tax breaks for the military

In salute to members of the armed forces serving overseas who want to purchase a home, the IRS is extending a lucrative tax perk for military personnel (http://www.irs.gov/newsroom/article/0,,id=215594,00.html). If you spent at least 90 days abroad performing qualified duty between Jan. 1, 2009, and April 30, 2010, you have an extra year to earn a homebuyer tax credit. In addition to uniformed service members, workers in the Foreign Service and in the intelligence community are eligible.

Thanks to this extension of the homebuyer tax credit (http://www.houselogic.com/articles/claim-your-homebuyer-tax-credits/), qualifying military personnel have until April 30, 2011, to sign a contract on a new home. The deal must close before July 1, 2011. Just like non-military buyers, first-time homebuyers can earn a tax credit worth up to $8,000, and longtime homeowners can earn a credit of up to $6,500. The same income restrictions and $800,000 cap on home prices apply.

Military personnel can also get a break if official duty calls and they're forced to move for an extended period. Normally, the homebuyer tax credit needs to be repaid if you sell your home within three years, but this requirement is waived for uniformed service members, Foreign Service workers, and intelligence community personnel. The new extended duty posting doesn't need to be overseas, but it must be at least 50 miles from your principal residence.

Challenge your real estate assessment

You can't do much about the rate at which your home is taxed, but you can try to do something about how your home is valued for taxation purposes in 2010. The process varies depending where you live, but in general local governments conduct a periodic real estate assessment to determine how much your home is worth. That real estate assessment figure is used to calculate your property tax bill.


You can usually appeal your real estate assessment (http://www.houselogic.com/articles/appeal-your-property-tax-bill/) if you think it's too high. Contact your local assessor's office to find out the procedure, and be prepared to do some research. There's often no charge to request a review of your assessment.

Look for errors. You probably received an assessment letter in the mail, and many local governments provide the information online as well. Make sure the number of bedrooms and bathrooms is accurate, and the lot size is correct. Also check the assessed value of comparable homes in your area. If they're being assessed for less than your home, you might have a case for relief.

Even if your assessment is accurate and comparable homes are being taxed at the same rate, there might be another route to tax savings. Ask your assessor's office about available property tax exemptions (http://www.houselogic.com/articles/common-property-tax-exemptions/). Local governments often give breaks to seniors, veterans, and the disabled, among others.

This article provides general information about tax laws and consequences, but is not intended to be relied upon by readers as tax or legal advice applicable to particular transactions or circumstances. Consult a tax professional for such advice; tax laws may vary by jurisdiction.


Mike DeSenne is Online Managing Editor for taxes, finances, and insurance at HouseLogic.com, and the former Executive Editor of SmartMoney.com. He likes to do his taxes by hand, much to the dismay of his accountant.

REALTOR® Magazine-Daily News-American Dream of Home Ownership Still Strong

REALTOR® Magazine-Daily News-American Dream of Home Ownership Still Strong

6 Do-It-Yourself Updates That Can Increase Home’s Value By More Than $10,000

By Melissa Dittmann Tracey, REALTOR® Magazine

Simple, affordable do-it-yourself projects such as cleaning and decluttering and just adding lighting can help increase a home’s resale value, according to HomeGain’s annual home improvement and staging survey.

HomeGain, an online real estate marketing resource, surveyed nearly 600 real estate professionals in creating a list of the top do-it-yourself home improvement projects that offer the biggest return for your buck.

Overall, the home improvement projects that boasted the highest price returns were updates to the kitchen and bathroom–an estimated $3,435 price increase for resale. Painting the outside of the home ($2,222 price increase) also offered one of the highest returns, according to HomeGain’s Home Sale Maximizer study.

Here are six do-it-yourself projects–all under $1,000–that made HomeGain’s list, as well as the estimated increase to the home’s price at resale for each project.

1. Cleaning and decluttering: Remove any personal items, unclutter countertops, organize closets and shelves, and make the home sparkling clean. 
Cost: $290    Estimated return: $1,990

2. Light and bright: Clean all windows inside and out, replace old curtains, update lighting fixtures, and remove anything that blocks light from the windows.
Cost: $375 cost   Estimated return: $1,550

3. Staging: Rearrange furniture, bring in new accessories and furnishings to enhance rooms, including artwork and playing soft music in the background.
Cost: $550 cost     Estimated return: $2,194

4. Landscaping: Punch up the home’s curb appeal in the front and backyards by adding bark mulch, bushes and flowers, and ensuring current plants and grass are well-cared for and manicured.
Cost: $540    Estimated return: $1,932

5. Repair electrical or plumbing: Repair any leaks under the bathroom or kitchen sinks, remove any mildew stains, and ensure all plumbing is in good working condition. Update the home’s electrical with new wiring for modern appliances, fix any lights or outlets that don’t work, and replace old plug points with new safety fixtures.
Cost: $535     Estimated return: $1,505

6. Replace or shampoo dirty carpets: Steam-clean carpets, replace any worn carpets, and repair any floor creaks.
Cost: $647   Estimated return: $1,739

Finishing Touches - Low Cost or Free Ways to Get your Home in Tip Top Shape

The reality today is that sellers don't want to spend big to get their house in tip-top shape for buyers. The good news is that there's plenty they can do for free or at a very low cost.


By Melissa Dittmann Tracey
February 2011


  
You may not be able to shell out money to professionally stage your home, but getting it sparkling and clutter-free requires little more than elbow grease. After clearing away clutter, polish the hardwoods, clean the countertops, and dust the light fixtures. You can make a stainless steel sink shine with thrifty cleaning remedies such as baby oil or club soda, according to DoItYourself.com. Howard Products’ line, which includes Restor-A-Finish (about $5 per can). It comes in various wood finishes and can be used to polish cabinets and even blend out minor scratches and imperfections.

Tips:


Box it up. Most people pack up after they sell the house, but why wait? Sellers should start packing as early as possible—ideally, before they put the home on the market.


Show off the laundry space. Buyers will be impressed if the laundry room is fresh, inviting, and organized. Make sure light bulbs are working, and hide soaps in a cupboard or line them neatly on a shelf.


Focus their attention. Pick a focal point for each room. For example, the focal point of a bedroom is usually the bed, and for a music room, it’s the piano. If a room is mostly empty, you can help draw attention to a corner with a plant or mirror.


Floors

Hardwoods are on most buyers’ wish lists (red oak being the most popular, according to the National Floor Trends 2010 market study). Hardwood flooring averages about $5 to $15 per square foot, plus about $2 to $8 per square foot for installation, so it’ll be pricier than vinyl, carpet, or other options. But it can make a huge difference. You may find less expensive hardwoods by going directly to installers, who buy their inventory wholesale. If it’s a small area, the upgrade won’t be as expensive, says remodeling industry expert Bill Millholland, an executive vice president with Case Design/Remodeling Inc. To imitate the look for less, try vinyl or Bamboo flooring, a sustainable resource that resembles wood but averages $4 to $6 per square foot.

Tips:
Call the experts. Dirty, worn carpet may benefit from professional cleaning, ranging about $180 to $390 for a 1,300-square-foot home.

Refinish it for cheap. Practically any beaten-up hardwood can be salvaged with refinishing, about $340 to $900 for a 15-by-15-foot room, according to CostHelper.com. Call a professional tile company to freshen up ceramic tile grout—or, for do-it-yourselfers, hardware stores sell grout paint.
Add a layer on top or bottom. One other option for lackluster flooring: Use an area rug, even over carpets. It’ll add a splash of color, and bring definition to living areas. If you’re adding inexpensive carpeting, consider upgrading the carpet pad.. It’s only about 50 cents more per square foot and it will make a budget carpet feel luxurious.


Lighting


New lighting fixtures are a quick way to create ambiance. Just avoid brass lighting fixtures, which had their heyday in the 1980s. More contemporary choices are brushed nickel and chrome finishes. Also, rust and oil-rubbed bronze are becoming more popular as more home owners set out to have lighting that doubles as an accent feature, says kitchen and bath designer David Alderman, 2011 National Kitchen and Bath Association president. Use lighting to highlight special features—pendant lights to show off that kitchen island or sconces to illuminate a foyer. Under-cabinet lighting in the kitchen is affordable and makes countertops sparkle, Millholland says. Fluorescent light strips tend to be more affordable and easier to install than puck lights.


Tips:


Go natural. Open those blinds and wipe down the windows. You’d be surprised at how much a simple window cleaning can instantly improve natural light.



Save on energy costs. Compact fluorescent bulbs remain the go-to choice for energy efficiency. Early CFLs didn’t always deliver on light quality or convenience, but they now come in warm, neutral, and cool colors, and major manufacturers are now enclosing the spiral tube in a conventional bulb shape.


Don’t forget the basement. The biggest problem with basements is a lack of adequate lighting. While the natural-lighting flow often can’t be altered, adding lights will create a sense of open airy space on a par with the rest of the house. Paint walls an opaque color so natural light will appear brighter.

Paint


A few gallons of paint can go a long way in making a home more chic—and the cost can’t be beat. Covering a 12-by-12-foot room with two coats will cost you about $50 to $100, including supplies. “A home’s interior painted in a pale yellow or light green, or even beige, gives buyers an idea of what they can do with a space,” says Bill Fields, vice president of merchandising for the Lowe’s paint division. Reserve darker or trendier colors for accent walls or to highlight details such as a fireplace or an arched doorway, says Erika Woelfel, director of color marketing at BEHR Process Corp., a paint supply company based in Santa Ana, Calif. Common color picks for accent walls are dark red, green (not lime green, though), or a stone gray. Or instead of introducing a new color, use the paint in the rest of the room as a guide, choosing a color that’s three shades darker. To bring depth to a long hallway, Fields suggests painting the wall at the end of a long hallway a different shade than the others.


Tips:


Shine with sheen. Flat or matte finish is difficult to clean and shows scuffs. Increasing the sheen can brighten rooms. Eggshell or satin bounces light off the walls to make spaces seem larger. Semi-gloss, higher on the sheen level, is a good option for kitchens and bathrooms since it’s easy to clean, Fields says. And gloss, the shiniest of all, is best for big “statement” areas, such as the front door, Woelfel says. But gloss accentuates flaws, so use it sparingly.

Create monochromatic harmony. Use different variations of the same color throughout the home. The Paint Quality Institute, a paint education resource, refers to this as “layering.” Choose a color card, which usually has about three or four similar hues, and use two or more colors from the single card. Use the lighter colors in the main living areas and darker shades for the rooms that branch out, such as the bedrooms, Woelfel suggests.

Paint the baseboards white. But don’t use stark white, which can take on gray tones against some wall colors, says Woelfel, who suggests antique white or Navajo white as better options. If the home has dated stained-wood trim, simply painting it off-white can bring it up-to-date. But don’t forget to use a primer first.


7 Ways to Create a Cohesive Style

Small updates will have a more dramatic impact if home owners are careful to keep the styles consistent and find ways to draw out the home’s best features. Here are some tips from experts on how to make small improvements pay off.

1. Concentrate on big impact rooms. Be selective about what you do. Kitchens and bathrooms still usually offer the most bang for your buck, says remodeling industry expert Bill Millholland, executive vice president with Case Design/Remodeling Inc.

2. Go neutral. Don’t introduce too much color to the “bones” of the home. You don’t want buyers to see too much bold color on cabinets and walls and say, “‘I have nothing to go with red,’” says Terrylynn Fisher, crs, green, a staging consultant at Empire Realty in Walnut Creek, Calif. “Buyers will have a tough time seeing past it.” Stay neutral with walls, cabinets, and fixtures. Bring in pops of colors through accessories.


3. Consult an expert. A professional stager or remodeler can work within your budget and pinpoint where best to spend your dollars. For a list of contractors or interior decorators, ask colleagues or friends for recommendations or check the Web sites of organizations such as the Real Estate Staging Association or the National Kitchen and Bath Association.


4. Know when inexpensive won’t work. Certain projects simply can’t be done cheaply, especially in a high-end home. “If it’s a luxury home, replacing the vanity with an off-the-shelf product from a big-box store isn’t going to cut it,” Millholland says. “Most consumers will be able to tell that you did something cheap. They won’t even see the value of it, so you’re better off cleaning what’s there and having it appear its best.”


5. Find inspiration. For design guidance, grab a catalog from Pottery Barn, Restoration Hardware, or Williams-Sonoma. “Anything you see in there is fairly consistent with what the average consumer is looking for,” Millholland says.


6. Plan your budget. Even small projects can carry a premium if a contractor is needed for installation. For labor savings, bulk your work, grouping several projects in a full day’s work rather than hiring a handyman or contractor for separate hourly jobs, Millholland says.

7. Complement the architecture. If it’s a two-story colonial home, avoid overly contemporary updates, such as stainless steel countertops. Likewise, if the exterior is modern or contemporary, stay away from traditional styles, such as dark wood or classic lighting fixtures, Millholland says.


Melissa Dittmann Tracey is a contributing editor for REALTOR® magazine.

10 Ways to Prepare for Homeownership

10 Ways to Prepare for Homeownership


1. Decide what you can afford. Generally, you can afford a home equal in value to between two and three times your gross income.


2. Develop your home wish list. Then, prioritize the features on your list.


3. Select where you want to live. Compile a list of three or four neighborhoods you’d like to live in, taking into account items such as schools, recreational facilities, area expansion plans, and safety.


4. Start saving.Do you have enough money saved to qualify for a mortgage and cover your down payment? Ideally, you should have 20 percent of the purchase price saved as a down payment. Also, don’t forget to factor in closing costs. Closing costs — including taxes, attorney’s fee, and transfer fees — average between 2 and 7 percent of the home price.


5. Get your credit in order.Obtain a copy of your credit report to make sure it is accurate and to correct any errors immediately. A credit report provides a history of your credit, bad debts, and any late payments.


6. Determine your mortgage qualifications.How large of mortgage do you qualify for? Also, explore different loan options — such as 30-year or 15-year fixed mortgages or ARMs — and decide what’s best for you.


7. Get preapproved. Organize all the documentation a lender will need to preapprove you for a loan. You might need W-2 forms, copies of at least one pay stub, account numbers, and copies of two to four months of bank or credit union statements.


8. Weigh other sources of help with a down payment. Do you qualify for any special mortgage or down payment assistance programs? Check with your state and local government on down payment assistance programs for first-time buyers. Or, if you have an IRA account, you can use the money you’ve saved to buy your fist home without paying a penalty for early withdrawal.


9. Calculate the costs of homeownership. This should include property taxes, insurance, maintenance and utilities, and association fees, if applicable.


10. Contact Deb Wilson,  an experienced REALTOR® who can help guide you through the process.

When you're in the market to buy a home, your credit score is very important. Most lenders use this three-digit number (which is created by evaluating factors like how much debt you have, your payment history for things like credit cards and car loans, and the length of your credit history) to determine your credit risk. This number helps lenders predict whether you'll pay back your loans and if you'll pay them on time.
Mortgage borrowers with the best credit ratings generally get lower interest rates. Their monthly mortgage payments are also lower, according to myfico.com, the website for the Fair Issac Corp., which created the most-used credit rating, the FICO score. (Your FICO score can range from 300 to 850; the higher your score, the better. Credit scores tend to be better for people who have credit -- e.g., have credit card accounts -- and pay off their credit on time.)
Generally, consumers with ratings in the mid 700s or higher get the best interest rates. (But this depends on the economic climate -- 680 was once considered a good score.)
For example, when we last checked data made available on myfico.com, a person with a better FICO score (760-850) was able to get a monthly mortgage payment for a 30-year fixed mortgage that was about $41 lower than someone who had a credit score of 700-759, according to the website's calculations. That person with the better FICO score would spend $492 less on mortgage payments over a year's period than the person with a lower score.
So, if you can increase your credit rating, you could save money over the length of your mortgage. (We all like to save money!) But raising your credit score isn't easy and takes time. (Like getting into shape, or sticking to a diet.) But if you keep to it and are diligent about it, you can increase your credit rating. Here's how:

How to Throw a FREE Game Day Fiesta - Superbowl Party

Saving for the Super Bowl: How to Throw a FREE Game Day Fiesta

Article From HouseLogic.com  Published: January 25, 2011

Get 6 smart tips to save big on your game-day party--and share some of your own tips for a chance to win a Super Bowl bash on us.

On Super Bowl Sunday, you want your head in the game, not worrying that your party is a drag or your wallet won't recover. HouseLogic has rounded up some smart ways to offset your party-planning expenses without sacrificing the fun come game time.

We want to hear from you, too. Join in the conversation through Facebook (http://www.facebook.com/HouseLogic) and you'll have a chance to win a $100 Visa gift card to spend on game day preparations, whether those include an extra-large party platter or your dream Pittsburgh Steelers or Green Bay Packers Fathead (http://www.fathead.com) wall graphic.

 

1. Cheer for charity

Have fun watching the game with friends and family while supporting a good cause--and take a tax deduction (http://www.celebrations.com/content/how-to-throw-a-charity-cocktail-party), too. Here's what to do:

                •Choose a charity or cause you love.

                •Provide guests with suggested donations. For example, if you want to raise $500, recommend each person donate $25.

                •Ask your local liquor store if it would donate a little free product in exchange for free promotion at your event. More often than not, the business is willing.

2. Get sponsored

Let a brand donate their food and drink to your party. Here's how to get involved:

                •HouseParty.com (http://www.houseparty.com/events) has a host of brands willing to provide free goods and services for your party, including DiGiorno Pizza and Kraft.

                •Pick the brand you'd like to host and then complete a questionnaire about yourself and your knowledge of the brand. Your answers help the House Party team know if you're a good fit for the promotion.

                •If you're chosen, the brand will supply a host of party goods for you and your friends to enjoy.

3. Go green to save green

Some NFL stadiums have been taking measures to go green (http://green.blogs.nytimes.com/2009/02/01/efficiency-and-recycling-at-the-super-bowl/) for years now, saving hundreds of thousands in energy costs and recycling everything from straws to cooking grease. Here's how you can conserve at home:

                •Use real dishes. Save about $20 and space in a landfill by not buying plastic plates, cups, and silverware.

                •Send Evites. Don't send paper invitations. Use free electronic invitations instead.

                •Recycle, donate, or sell your big, old TV. Use the big game as an excuse to treat yourself to a sleek, energy-efficient LCD TV (http://www.houselogic.com/articles/5-tips-saving-energy-family-room/). It'll cost you up front, though you may find a pre-game day deal (see below) and you'll save on energy in the long run.

                •"Hypercook" it. A great way to save energy (and money) is to turn your oven off before your dish is finished cooking (http://www.seriouseats.com/2009/09/serious-green-save-energy-with-hypercooking-tips.html). You can also skip preheating or use a smaller cooker like a toaster oven to make some meals.

                •Turn off bar room light displays (http://www.charlesandhudson.com/archives/2010/02/super_bowl_party_prep.htm). You may love your Coors Light neon sign but you don't need it, especially when the game should be taking center stage.

4. Go coupon hunting

There are tons of blogs and websites out there that have the scoop on the latest deals at hundreds of retailers. Save big on everything from food to supplies to electronics just by spending a few minutes doing an online search. Here's what we found:

                •CouponMountain.com (http://www.couponmountain.com/super-bowl-deals-sales.html) has deals on electronics, decorations, food, gear, and even tickets to the big game. And sites like Bargain Babe (http://bargainbabe.com/) and Deal Seeking Mom (http://dealseekingmom.com/) also keep tabs on great sales.

                •Safeway (http://www.safeway.com/IFL/Grocery/Home) is also helping football fans prepare for Super Bowl parties with a host of party-themed recipes and coupons. (http://queenbeecoupons.com/2011/01/safeway-joy-of-football-coupon-book-over-70-in-savings/)

                •Also nab that LCD TV for less on sites like overstock.com (http://www.overstock.com/Electronics/LCD-TVs/12970/subcat.html) or catch Super Bowl season sales (http://www.zdnet.com/blog/gadgetreviews/sears-and-best-buy-planning-pre-super-bowl-hdtv-sales/21736) at stores like Best Buy or Sears.

5. Get a little help from your friends

After all, it's the company that really makes the party special. So rather than breaking your back (and the bank) trying to get everything done by yourself, include your guests and make it fun.

                •Have a competitive potluck. Have a cook-off for fans of opposing teams (or let each person fend for themselves). It'll add to the spirit of the day and save you big on groceries.

                •Ask for help. Need extra chairs? Ask your friends to bring them instead of buying them. Looking for some preshow entertainment? Ask your friends to bring their favorite games to play. That's what friends are for.

6. Tell us your money-saving tips!

Let us know some of your own great money-saving tips for hosting a Super Bowl party on Facebook (http://www.facebook.com/HouseLogic) -and you'll have the chance to win a $100 gift card from HouseLogic!

No purchase necessary to enter or win. Must be a U.S. resident and 18 years of age or older at time of entry. Void where prohibited or restricted by law. Winner will be chosen at 2 p.m. Eastern time on January 31.

Visit houselogic.com for more articles like this. Reprinted from HouseLogic with permission of the NATIONAL ASSOCIATION OF REALTORS®
Copyright 2011.  All rights reserved

Why you should, or shouldn't, buy a foreclosure

By Trulia Staff
Published: Oct 14, 2009


Home buyers may be able to get deals on foreclosures, which are often discounted in price, but buying foreclosures can be risky. It's essential to understand the pros and cons of buying a foreclosure before making a purchase.


First of all, there are several types of properties that are generally known as "foreclosures." A "pre-foreclosure" is a home which is in danger of falling into foreclosure, but is still owned by the homeowner. A "foreclosure" is a property that will be sold or repossessed by a creditor or a lender to recover the amount owed on it.


While pre-foreclosures are available for purchase from a homeowner, foreclosures can be bought at auction or as "bank-owned properties" (also known as "real-estate owned" properties) from a lender.


Pros of buying a foreclosure


You may be able to purchase a home at a lower-than-market-value price. If the home is in pre-foreclosure, the homeowner is looking to sell the home to avoid going into foreclosure. These homeowners are usually in a hurry to sell, putting buyers at an advantage.


Banks are also often willing to offer foreclosures at a discount -- the longer they hold these properties, the more it costs them in terms of taxes, maintenance, etc.


Foreclosures can be found at all sorts of price points (starter homes, luxury homes, etc.) and sometimes are only in need of minor repair or upgrades.


With some sweat equity, repairs and upgrades, a homeowner can turn a foreclosure into a home and see some appreciation in the property's value.

Cons


Since foreclosures are often offered at significant discounts, you may face steep competition and bidding from other buyers.


Foreclosures aren't always offered at a large discount. Homeowners in the pre-foreclosure stage may price a home higher than it is worth in the hopes of paying off a mortgage, taxes, etc. Banks are looking to recoup at least what's owned on the house, so they may only offer a slight discount.

If you are buying a foreclosed home at an auction, you may have to pay cash (the same day!) and may not be able to inspect the home before purchase.

Some lenders don't offer loans for distressed properties.

Foreclosures may need serious and costly repair. The previous owner might not have been able to afford fixes for the property and may have allowed it to fall into disrepair.

Foreclosures are often vandalized and looted; it's not uncommon to find major appliances missing, holes kicked in the walls and other vandalism.

Foreclosures tend to sit vacant for periods of time, which causes major maintenance issues. If a home is not maintained, its pipes could freeze, vermin and bugs could settle in and mold could grow.


You need to do your research -- a foreclosure can have liens attached to it. You may find yourself having to pay costly old debts associated with the property.

Foreclosures often are sold as is and banks often aren't interested in making or footing the bill for repairs.

At times, foreclosure buyers have to start eviction proceedings and pay legal fees to get the previous tenants/owners out of the home.


Purchasing a home from a lender can be a lengthy and time-consuming process that's full of red tape.

8 Tips for Finding Your New Home

Article From BuyAndSell.HouseLogic.com

By: G. M. Filisko

A solid game plan can help you narrow your homebuying search to find the best home for you.

House hunting is just like any other shopping expedition. If you identify exactly what you want and do some research, you'll zoom in on the home you want at the best price. These eight tips will guide you through a smart homebuying process.