Virginia Beach Real Estate According to Liz

Homebuyer Tax Credit Information!

2009-05-05T21:14:00.002-04:00

1.Who is eligible to claim the tax credit?
First-time home buyers purchasing any kind of home—new or resale—are eligible for the tax credit. To qualify for the tax credit, a home purchase must occur on or after January 1, 2009 and before December 1, 2009. For the purposes of the tax credit, the purchase date is the date when closing occurs and the title to the property transfers to the home owner.

2.What is the definition of a first-time home buyer?
The law defines "first-time home buyer" as a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse.

For example, if you have not owned a home in the past three years but your spouse has owned a principal residence, neither you nor your spouse qualifies for the first-time home buyer tax credit. However, unmarried joint purchasers may allocate the credit amount to any buyer who qualifies as a first-time buyer, such as may occur if a parent jointly purchases a home with a son or daughter. Ownership of a vacation home or rental property not used as a principal residence does not disqualify a buyer as a first-time home buyer.

3.How is the amount of the tax credit determined?
The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.

4.Are there any income limits for claiming the tax credit?
Yes. The income limit for single taxpayers is $75,000; the limit is $150,000 for married taxpayers filing a joint return. The tax credit amount is reduced for buyers with a modified adjusted gross income (MAGI) of more than $75,000 for single taxpayers and $150,000 for married taxpayers filing a joint return. The phaseout range for the tax credit program is equal to $20,000. That is, the tax credit amount is reduced to zero for taxpayers with MAGI of more than $95,000 (single) or $170,000 (married) and is reduced proportionally for taxpayers with MAGIs between these amounts.

5.What is "modified adjusted gross income"?
Modified adjusted gross income or MAGI is defined by the IRS. To find it, a taxpayer must first determine "adjusted gross income" or AGI. AGI is total income for a year minus certain deductions (known as "adjustments" or "above-the-line deductions"), but before itemized deductions from Schedule A or personal exemptions are subtracted. On Forms 1040 and 1040A, AGI is the last number on page 1 and first number on page 2 of the form. For Form 1040-EZ, AGI appears on line 4 (as of 2007). Note that AGI includes all forms of income including wages, salaries, interest income, dividends and capital gains.

To determine modified adjusted gross income (MAGI), add to AGI certain amounts of foreign-earned income. See IRS Form 5405 for more details.

6.If my modified adjusted gross income (MAGI) is above the limit, do I qualify for any tax credit?
Possibly. It depends on your income. Partial credits of less than $8,000 are available for some taxpayers whose MAGI exceeds the phaseout limits.

7.Can you give me an example of how the partial tax credit is determined?
Just as an example, assume that a married couple has a modified adjusted gross income of $160,000. The applicable phaseout to qualify for the tax credit is $150,000, and the couple is $10,000 over this amount. Dividing $10,000 by the phaseout range of $20,000 yields 0.5. When you subtract 0.5 from 1.0, the result is 0.5. To determine the amount of the partial first-time home buyer tax credit that is available to this couple, multiply $8,000 by 0.5. The result is $4,000.

Here’s another example: assume that an individual home buyer has a modified adjusted gross income of $88,000. The buyer’s income exceeds $75,000 by $13,000. Dividing $13,000 by the phaseout range of $20,000 yields 0.65. When you subtract 0.65 from 1.0, the result is 0.35. Multiplying $8,000 by 0.35 shows that the buyer is eligible for a partial tax credit of $2,800.

Please remember that these examples are intended to provide a general idea of how the tax credit might be applied in different circumstances. You should always consult your tax advisor for information relating to your specific circumstances.

8.How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008?
The most significant difference is that this tax credit does not have to be repaid. Because it had to be repaid, the previous "credit" was essentially an interest-free loan. This tax incentive is a true tax credit. However, home buyers must use the residence as a principal residence for at least three years or face recapture of the tax credit amount. Certain exceptions apply.

9.How do I claim the tax credit? Do I need to complete a form or application?
Participating in the tax credit program is easy. You claim the tax credit on your federal income tax return. Specifically, home buyers should complete IRS Form 5405 to determine their tax credit amount, and then claim this amount on Line 69 of their 1040 income tax return. No other applications or forms are required, and no pre-approval is necessary. However, you will want to be sure that you qualify for the credit under the income limits and first-time home buyer tests. Note that you cannot claim the credit on Form 5405 for an intended purchase for some future date; it must be a completed purchase.

10.What types of homes will qualify for the tax credit?
Any home that will be used as a principal residence will qualify for the credit. This includes single-family detached homes, attached homes like townhouses and condominiums, manufactured homes (also known as mobile homes) and houseboats. The definition of principal residence is identical to the one used to determine whether you may qualify for the $250,000 / $500,000 capital gain tax exclusion for principal residences.

11.I read that the tax credit is "refundable." What does that mean?
The fact that the credit is refundable means that the home buyer credit can be claimed even if the taxpayer has little or no federal income tax liability to offset. Typically this involves the government sending the taxpayer a check for a portion or even all of the amount of the refundable tax credit.

For example, if a qualified home buyer expected, notwithstanding the tax credit, federal income tax liability of $5,000 and had tax withholding of $4,000 for the year, then without the tax credit the taxpayer would owe the IRS $1,000 on April 15th. Suppose now that the taxpayer qualified for the $8,000 home buyer tax credit. As a result, the taxpayer would receive a check for $7,000 ($8,000 minus the $1,000 owed).

12.I purchased a home in early 2009 and have already filed to receive the $7,500 tax credit on my 2008 tax returns. How can I claim the new $8,000 tax credit instead?
Home buyers in this situation may file an amended 2008 tax return with a 1040X form. You should consult with a tax advisor to ensure you file this return properly.

13.Instead of buying a new home from a home builder, I hired a contractor to construct a home on a lot that I already own. Do I still qualify for the tax credit?
Yes. For the purposes of the home buyer tax credit, a principal residence that is constructed by the home owner is treated by the tax code as having been "purchased" on the date the owner first occupies the house. In this situation, the date of first occupancy must be on or after January 1, 2009 and before December 1, 2009.

In contrast, for newly-constructed homes bought from a home builder, eligibility for the tax credit is determined by the settlement date.

14.Can I claim the tax credit if I finance the purchase of my home under a mortgage revenue bond (MRB) program?
Yes. The tax credit can be combined with the MRB home buyer program. Note that first-time home buyers who purchased a home in 2008 may not claim the tax credit if they are participating in an MRB program.

15.I live in the District of Columbia. Can I claim both the Washington, D.C. first-time home buyer credit and this new credit?
No. You can claim only one.

16.I am not a U.S. citizen. Can I claim the tax credit?Maybe. Anyone who is not a nonresident alien (as defined by the IRS), who has not owned a principal residence in the previous three years and who meets the income limits test may claim the tax credit for a qualified home purchase. The IRS provides a definition of "nonresident alien" in IRS Publication 519.

17.Is a tax credit the same as a tax deduction?No. A tax credit is a dollar-for-dollar reduction in what the taxpayer owes. That means that a taxpayer who owes $8,000 in income taxes and who receives an $8,000 tax credit would owe nothing to the IRS.

A tax deduction is subtracted from the amount of income that is taxed. Using the same example, assume the taxpayer is in the 15 percent tax bracket and owes $8,000 in income taxes. If the taxpayer receives an $8,000 deduction, the taxpayer’s tax liability would be reduced by $1,200 (15 percent of $8,000), or lowered from $8,000 to $6,800.

18.I bought a home in 2008. Do I qualify for this credit?
No, but if you purchased your first home between April 9, 2008 and January 1, 2009, you may qualify for a different tax credit. Please consult with your tax advisor for more information.
19.Is there any way for a home buyer to access the money allocable to the credit sooner than waiting to file their 2009 tax return?
Yes. Prospective home buyers who believe they qualify for the tax credit are permitted to reduce their income tax withholding. Reducing tax withholding (up to the amount of the credit) will enable the buyer to accumulate cash by raising his/her take home pay. This money can then be applied to the downpayment.

Buyers should adjust their withholding amount on their W-4 via their employer or through their quarterly estimated tax payment. IRS Publication 919 contains rules and guidelines for income tax withholding. Prospective home buyers should note that if income tax withholding is reduced and the tax credit qualified purchase does not occur, then the individual would be liable for repayment to the IRS of income tax and possible interest charges and penalties.

Further, rule changes made as part of the economic stimulus legislation allow home buyers to claim the tax credit and participate in a program financed by tax-exempt bonds. Some state housing finance agencies, such as the Missouri Housing Development Commission, have introduced programs that provide short-term credit acceleration loans that may be used to fund a downpayment. Prospective home buyers should inquire with their state housing finance agency to determine the availability of such a program in their community.

The National Council of State Housing Agencies (NCSHA) has compiled a list of such programs, which can be found here.
20.If I’m qualified for the tax credit and buy a home in 2009, can I apply the tax credit against my 2008 tax return?
Yes. The law allows taxpayers to choose ("elect") to treat qualified home purchases in 2009 as if the purchase occurred on December 31, 2008. This means that the 2008 income limit (MAGI) applies and the election accelerates when the credit can be claimed (tax filing for 2008 returns instead of for 2009 returns). A benefit of this election is that a home buyer in 2009 will know their 2008 MAGI with certainty, thereby helping the buyer know whether the income limit will reduce their credit amount.

Taxpayers buying a home who wish to claim it on their 2008 tax return, but who have already submitted their 2008 return to the IRS, may file an amended 2008 return claiming the tax credit. You should consult with a tax professional to determine how to arrange this.
21.For a home purchase in 2009, can I choose whether to treat the purchase as occurring in 2008 or 2009, depending on in which year my credit amount is the largest?
Yes. If the applicable income phaseout would reduce your home buyer tax credit amount in 2009 and a larger credit would be available using the 2008 MAGI amounts, then you can choose the year that yields the largest credit amount.

If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

Happy New Year!

2009-01-02T14:07:00.003-05:00

Happy New Year Bloggers!
I think many of us in the industry are ready to say goodbye to 2008 and are looking forward to a New Year in 2009 full of change, promise, and a fresh start! I feel optimistic as do many of my co-workers and peers that the market is ripe for some great business this coming year. With rates at their lowest in 30 years, home values remaining reasonable, and sellers ready to sell, the time is ripe for buyers. More buyers will be able to qualify with these low rates, so talk to your loan officer about refinancing or even qualifying to start finding that dream home. The stars are aligned for buyers! For those of you who are looking for movers, Start Packing in VB is locally owned, very reasonable, and professional. I used them recently for my own personal move and will never move myself again!
So here's to a New Year full of promise and oppurtunity!

If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

How to Buy a House: The Very Basics

2008-10-07T14:05:00.002-04:00

You don't pay cash when you buy a home. If you had to do that then nobody could afford to buy a house. Instead you get a loan from a bank called a mortgage. You make payments on this loan every month for 15 or 30 years, and then you get to stop making payments.
Most homebuyers also make a cash down payment of 3 to 20% of the sale price. The higher the down payment you can make, the easier it is to get a loan, and the lower the interest rate is, and the lower the monthly payment is. But if you can't afford to make a down payment (or don't want to), banks are increasingly offering "zero-down" loans. In fact, 43% of first-time homebuyers put no money down. (USA Today, 2006)
If you're rich and don't need a loan and can pay cash for a house. In this eceonomy, who is rich?!?

In most cases it makes more financial sense to buy instead of rent, and to buy as soon as you can afford to do so. Most people think the benefit in buying is to "stop throwing your money away on rent," but in fact the equity you build from buying is offset by the money you will "throw way" on taxes, insurance, and maintenance, which renters don't pay. The real benefit from buying is that you freeze your monthly payment for 15 to 30 years, and then you stop paying it altogether

What kind of home can I afford?

In general you can afford a home worth about three times your annual household income. If your combined income is $50,000, you could afford a $150,000 house.

If it looks like you can't afford a home then consider getting a bigger home than you need and renting out part of it. This is especially applicable to single people, where the smallest home they can find might be too big for their needs. For example:
In 2006 a friend of mine was paying $600 to live in a tiny 1-bedroom apartment. She bought a 4-bedroom house that cost her $1100/mo., and rented out two of the rooms for $600/mo. total. So her net cost per month is only $500. She's spending $100/mo. less, and she has twice as much room, a yard for her dog, and she owns her own house.

How much a home costs

The median price for a home was $225,000 in U.S. metro areas in late 2006. Of course the price varies according to the part of town, and even the state you're in. Homes in California cost lots more than homes in West Virginia and Arkansas. And naturally if the median (middle) price is $225,000, there are houses available for much less.

How much will my monthly payments be

Your monthly payments will probably be 0.75% to 1.15% of the purchase price. On a $150,000 home that's $1125 to $1725/mo. This includes taxes and insurance.

The bigger your down payment, the lower the monthly payments.
The lower the interest rate, the lower the monthly payments.
The longer the loan, the lower your monthly payments. But it's better to get a shorter loan so you pay it off quicker and save on interest, if you can afford the higher payments.
Don't forget that you can lower your monthly obligation by renting out a room or two (or a whole side, if you buy a duplex).
To afford a house you'll need the up-front money as well as money for the monthly payments

Money you'll need up front

3 to 20% of the purchase price for a down payment. The actual amount depends on what kind of loan you get and how good your credit is. Your bank might offer a zero-down loan, but if you can afford to make a down payment, you should do so, because you'll get a lower interest rate and because your monthly payments will be lower. These loans are increasingly hard to find.

1 to 8% of the purchase price for closing costs. You might not have to pay this up front. The bank might be willing to add it to your mortgage. (Add them to the mortgage if you need the cash, but pay the closing costs up front if you don't.) The actual amount of closing costs depends on how good a deal your lender is willing to give you, and the price of the house. The more expensive the home, the less the closing costs are as a percentage of the total price. Sellers are also paying closing costs.

$250 to $800 in Miscellaneous Costs. These are things like the application fee for the loan, the fee for the bank to run your credit report, professional inspection of the home, and an appraisal (if you can't get the appraisal added to the closing costs).

Putting these three things together, on a $150,000 house you'll need
$4500 to $30,000 for the down payment (unless you get a 0% down loan)
$0 to $12,000 for the closing costs
$250 to $800 for miscellaneous costs
Total: $4750 to $42,800. Yes, that's quite a difference. You'll learn more about estimating the costs for your own situation as you go through this guide.

How to get a mortgage
You generally need four things to qualify for a mortgage:
1. Money to make the down payment.
2. Income that's 2 to 3 times higher than your mortgage payment. (more on figuring mortgage payments in a minute)
3. Two years of solid employment history (same job or field).
4. Decent (not perfect) credit.
There are sometimes ways around this if you lack one or two of those, but usually not if you lack three or four.

How to find and buy a home

1. Read the rest of this guide, especially the parts about estimating how much home you can afford. The rest of this guide covers everything below.

2. Get a copy of your credit report and clean up your credit record as much as possible.

3. Go to your bank, ask to talk to a loan officer, tell them you want to buy a house, fill out an application, and get what's called a Pre-Qual Letter. You may have to pay an application fee of $40 or so.

4. Find a realtor (get referrals from friends). The seller pays the commission to your realtor, so it costs you nothing to have a realtor. Your realtor serves you by letting you know what houses are available that meet your needs (they have access to a special database) and by answering your questions about the process.

5. Tell the realtor what part(s) of town you want to live in, what kind of house you want, and how much the bank said they'd loan you. Your realtor will give you a list of houses that match your criteria. Go look at them.

6. When you find a house you want get the Disclosure from the seller. This is a list of problems with the house that the seller knows about, and which they're required to give you by law.

7. If the Disclosure doesn't sour you on the house, ask the realtor how much you should offer. It's rare that you accept the price given by the seller, usually you'll offer slightly less than they're asking. Get a list of Comparables (similar homes that have sold in the same area recently) from your realtor so you can get an idea of how much the house is worth.

8. You'll make the offer by signing a contract. If the seller accepts your offer then they'll sign too. At this point you're generally obligated to buy the house and the seller is generally obligated to sell, though depending on the wording of the contract either of you could have the right to walk away from the deal under certain circumstances.

9. Have the house professionally inspected. You generally have to pay this yourself, at the time, and it will cost $300 or so. If the inspection turns up problems not listed on the disclosure which will cost a lot to fix, try to get the seller to lower the price or fix the problems before the sale -- or walk away from the deal if your contract allows that and that's what you want.

10. The bank will have the house appraised to make sure it's worth what you're paying for it. (They don't want to loan you $200,000 to buy a house that's worth only $150,000.) You might have to pay this up front, otherwise it will be added to your closing costs. Besides paying for it up front if that's required, you're not involved in this step of the process.

11. Find an insurance agent (ask friends for referrals) and get a quote. You can certainly price-shop 2-3 different companies if you like. Pick one and tell them you want the insurance. The cost will be added to your closing costs, you don't have to pay this at the time.

12. Closing. You go to the office that's handling the closing (a title company or an attorney, usually selected by the lender or the seller), and bring with you a bank check to cover the down payment and the closing costs (unless the closing costs are being rolled into the mortgage). This can be two checks or one. You don't need to get a check for the mortgage loan, the bank will wire that directly to the office handling the closing.

If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

Dining in Pungo/Sandbridge

2008-10-07T13:47:00.002-04:00

If you like Seafood then I have the place for you. My family just re-opened the Seacrest in downtown Pungo, which is technically Virginia Beach. Its high quality food served in a laid back atmosphere. The Seacrest is known for its world famous she-crab soup and stuffed flounder. Everything is made from scratch and fresh. If you love seafood, this is the place to be. Its less than 5 minutes down the road from this years homearama. I am headed to Realtor day tomorrow at Homearama so more on that!

If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

Dining in Norfolk

2008-09-22T15:11:00.002-04:00

As promised here's the next restaurant of interest in the Hampton Roads area, Siam 21 in Norfolk. Siam 21 is a Thai/Vietnamese restaurant in downtown Norfolk. The atmosphere is very calming and authentic. The service was a little slow, but once the food arrived. All is forgotten! It has the family feel and is good for a family night out or a cozy place for a date. I ordered the drunken noodles and a green curry. The food was flavorful with just the right amount of spice! I would very much recommend this place to anyone with a hankering for Thai. It compares with the ever popular Bangkok Garden for food quality but is actually a little bit cheaper, which is always good!
If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

The Mortgage Process

2008-09-22T15:09:00.001-04:00

Qualifying for a Mortgage Loan
First let me caveat this post with the fact that I am not a mortgage specialist and this is a bit outside my usual realm of expertise. To verify this information or delve deeper into it, I would consult a mortgage broker. However, as a Realtor, we do know a lot about the mortgage process. Before I was a Realtor, I worked for a loan officer. So I do know a few things……I hope this guide helps!

Banks don't loan money to just anybody. They want to feel secure that you're able and responsible enough to pay them back, especially since the sub-prime fiasco. So you'll usually need these things in order for the bank to give you a loan:
*Enough money for the Down Payment (3 to 20% of the purchase price)
*Two years of steady employment (same job or field)
*Good (not perfect) credit score (thought the better the credit the better the interest rate)
*Income that's 2 to 3 times higher than your expected mortgage payment

If you don't have all these things right now don't fret. You still have some options.
Meet with a lender anyway. Don't just assume you can't get a mortgage. It can't hurt to go talk to a bank and see whether they're willing to give you a loan. Even if they won't give you a loan they can probably help you by letting you know where the deficiencies are, so you can work towards qualifying in the future.

Try for a Low-Doc or No-Doc Loan. In recent years banks have been offering loans to people who can't (or don't want to) provide details about their income or their employment. The most popular is called a Stated Income loan because you just "state" how much income you have without offering any proof. It's also called NIV for "No Income Verification" because your income isn't verified. With No Ratio and No Doc loans, you don't even say how much you make. You can think of these as "Don't Ask, Don't Tell" loans. The No Doc is also called NINA, for "No Income & No Asset verification". Because income is never proven with any of these loans I joking call them the "Drug Dealer Loans", though of course there are many legitimate reasons for wanting a loan of this type. People such as myself who are self-employed or commission based often have a lot of tax write-offs and that hurts you in qualifying for a loan. My good credit, and my willingness to pay a tiny amount of extra interest, was enough to get me the loan without having to supply any paperwork. So this program is perfect for this group of people. The draw backs to these loans are usually a higher interest rate and a minimum down payment of 10%. Since the bank is taking a bigger risk on you with a No-Doc or Low-Doc loan, the interest rate is higher than on a traditional loan, and the exact amount depends on your credit score, your lender's preference, and which flavor of low-doc/no-doc loan you get. The premium you'll pay will range 0.125 to 3.0 percentage points over a traditional loan.

Use a Mortgage Broker. A mortgage broker represents lots of different lenders so they can shop around to try to find one who will make you a loan. They charge a fee for this service but if you can't get a mortgage otherwise then it could be worth it. You can find mortgage brokers in the homes section of the newspaper classifieds and in the yellow pages. But usually the best ones you find are the ones that come recommended to you from your trusty Realtor, friends, family, or coworkers.

If you have a hard time qualifying for what you want or are denied, don’t give up! Get a co-signer! See if a family member or very close friend with a higher income and better credit than yours will cosign a loan for you. That means that the loan will be yours and you'll be responsible for paying it, but if you don't, the cosigner will have to pay it. Obviously the cosigner will have to have a great deal of trust in you for this option to work and to violate that trust is terrible. This is only the way to go if you know you can afford the place. Many people go this route when they know they will have a roommate or a significant other paying half the mortgage (which is not used in qualifying you for a loan).
Another option in the case of denial in lieu of a cosigner is to have a friend or family member buy the house, and rent-to-own it from them. Friends and family might be wary of co-signing a loan for you because their credit gets ruined if you don't make the house payments, and they have little recourse against you. A more attractive alternative is to have your friend or family member buy the house in their name, and then rent it to you with an option to buy. My parents did this for me when I first started out and it put me in a good position to buy my next home!

Here's how it works: You'll make the mortgage payments and pay for taxes, insurance, and maintenance, as your "rent". You can get the house in your name by either making all the payments after 30 years, or by buying the house for the amount of the remaining mortgage once your credit or income improves enough for you to get your own loan. If you fail to make your payments, you forfeit your right to buy the house, and your friend/family member can either pick up the payments or sell the house. Either way, they're not out because they already own the house. They don't have to foreclose if you don't pay, because the house was already in their name. For that reason this arrangement can be more attractive to them than the idea of their being a cosigner.
In fact, if you don't have the money for a down payment, your friend/family member might loan you the money for the down payment as well -- usually for a slightly higher interest rate than the mortgage.
A downside of having someone buy the house for you is that the interest rate will be about 1% higher because the house will be considered investment property for the buyer and not a residence, since they're not going to live in it. Still, if the only way you can get yourself into your own home is to pay a little more interest, it might be worth it.
Plan for the future. Even if you can't buy a home right this very minute if you make home-owning a serious goal then within two years you can probably overcome most or all of any obstacles above.
If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

Dining in Virginia Beach

2008-09-10T12:40:00.003-04:00

One of the best parts of living in Hampton Roads is the dining. I love to eat out and I have made it my mission to, as part of my promotion of living in Hampton Roads, to discuss once a week a great place to eat! This week's pick is Back Bay Pizza in Virginia Beach at Hilltop next to the Melting Pot. This restaurant has been open for about 8 months as a full service pizza restaurant. The serve gourmet salad and pizza, as well as main dishes. I ordered a portabella mushroom pizza and caesar salad. The pizza was amazing and the salad had the perfect ratio of dressing to lettuce. The atmosphere is reserved and laid back with subtle lighting and white linen. The staff was very personable. I would definitely recommend this place for a pizza connoisseur. You can also get their gourmet pizzas to go, ready to be baked fresh at your oven at home. So support your local small businesses and check this place out!

If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

How to Prepare a Home for Sale

2008-09-03T14:28:00.003-04:00

Here's How:
1. Disassociate Yourself With Your Home.
· Say to yourself, "This is not my home; it is a house -- a product to be sold much like a box of cereal on the grocery store shelf.
· Make the mental decision to "let go" of your emotions and focus on the fact that soon this house will no longer be yours.
· Picture yourself handing over the keys and envelopes containing appliance warranties to the new owners!
· Say goodbye to every room.
· Don't look backwards -- look toward the future.

2. De-Personalize.Pack up those personal photographs and family heirlooms. Buyers can't see past personal artifacts, and you don't want them to be distracted. You want buyers to imagine their own photos on the walls, and they can't do that if yours are there! You don't want to make any buyer ask, "I wonder what kind of people live in this home?" You want buyers to say, "I can see myself living here."

3. De-Clutter!People collect an amazing quantity of junk. Consider this: if you haven't used it in over a year, you probably don't need it.
· If you don't need it, why not donate it or throw it away?
· Remove all books from bookcases.
· Pack up those knickknacks.
· Clean off everything on kitchen counters.
· Put essential items used daily in a small box that can be stored in a closet when not in use.
· Think of this process as a head-start on the packing you will eventually need to do anyway.

4. Rearrange Bedroom Closets and Kitchen Cabinets. Buyers love to snoop and will open closet and cabinet doors. Think of the message it sends if items fall out! Now imagine what a buyer believes about you if she sees everything organized. It says you probably take good care of the rest of the house as well. This means:
· Alphabetize spice jars.
· Neatly stack dishes.
· Turn coffee cup handles facing the same way.
· Hang shirts together, buttoned and facing the same direction.
· Line up shoes.

5. Rent a Storage Unit. Almost every home shows better with less furniture. Remove pieces of furniture that block or hamper paths and walkways and put them in storage. Since your bookcases are now empty, store them. Remove extra leaves from your dining room table to make the room appear larger. Leave just enough furniture in each room to showcase the room's purpose and plenty of room to move around. You don't want buyers scratching their heads and saying, "What is this room used for?"

6. Remove/Replace Favorite Items.If you want to take window coverings, built-in appliances or fixtures with you, remove them now. If the chandelier in the dining room once belonged to your great grandmother, take it down. If a buyer never sees it, she won't want it. Once you tell a buyer she can't have an item, she will covet it, and it could blow your deal. Pack those items and replace them, if necessary.
7. Make Minor Repairs.
· Replace cracked floor or counter tiles.
· Patch holes in walls.
· Fix leaky faucets.
· Fix doors that don't close properly and kitchen drawers that jam.
· Consider painting your walls neutral colors, especially if you have grown accustomed to purple or pink walls. (Don't give buyers any reason to remember your home as "the house with the orange bathroom.")
· Replace burned-out light bulbs.
· If you've considered replacing a worn bedspread, do so now!

8. Make the House Sparkle!
· Wash windows inside and out.
· Rent a pressure washer and spray down sidewalks and exterior.
· Clean out cobwebs.
· Re-caulk tubs, showers and sinks.
· Polish chrome faucets and mirrors.
· Clean out the refrigerator.
· Vacuum daily.
· Wax floors.
· Dust furniture, ceiling fan blades and light fixtures.
· Bleach dingy grout.
· Replace worn rugs.
· Hang up fresh towels.
· Bathroom towels look great fastened with ribbon and bows.
· Clean and air out any musty smelling areas. Odors are a no-no.

9. Scrutinize.
· Go outside and open your front door. Stand there. Do you want to go inside? Does the house welcome you?
· Linger in the doorway of every single room and imagine how your house will look to a buyer.
· Examine carefully how furniture is arranged and move pieces around until it makes sense.
· Make sure window coverings hang level.
· Tune in to the room's statement and its emotional pull. Does it have impact and pizzazz?
· Does it look like nobody lives in this house? You're almost finished.

10. Check Curb Appeal.If a buyer won't get out of her agent's car because she doesn't like the exterior of your home, you'll never get her inside.
· Keep the sidewalks cleared.
· Mow the lawn.
· Paint faded window trim.
· Plant yellow flowers or group flower pots together. Yellow evokes a buying emotion. Marigolds are inexpensive.
· Trim your bushes.
· Make sure visitors can clearly read your house number.

MOST IMPORTANTLY: List that sparkling house with a Realtor! :)

If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

Foreclosures/Hud Homes in Virginia Beach, Chesapeake, Norfolk, and Suffolk

2008-08-22T14:17:00.003-04:00

Buying a forclosure from HUD (Housing and Urban Development) can be an easy process, believe it or not. You need an agent who has experience with HUD to make it a smooth transaction for you. As a buyer of a HUD home, you do not have the same luxuries as the buyer of a regular/resale home. Your earnest money deposit amount is pre-determined and non-refundable. If the property is $50,000 or less, the earnest money deposit (emd) is $500, if the house is going for more than that, which is normally the case, the emd is $1,000. The emd with foreclosed homes is non-refundable, so if you violate the terms of the HUD contract (which greatly varies from a normal REIN sales contract), you lose that money. You are not dealing with Mr. and Mrs. Selller but the government so the rules are firm. When you put a bid in (HUD will only accept bids from Realtors, so you do need one of these!) and it is accepted (YEAH!) you have exactly 45 days from that point to close. If you do not close in 45 days, you can lose your emd and have to pay $25 a day for every day you do not close past the 45. There are exceptions, but keep in mind this is the government and these are few and far between.
If you ave an interest in these homes, you need to get in touch with a realtor such as myself who has experience with them and can search the appropriate HUD sites for these homes. They are usually very good deals, but please keep in mind they are not for the average buyers. HUD homes are usually distressed and need work. Which means that you will need some cash to get the house right for you or to flip. Because most of them need work, financing can be hard. Make sure your loan officer is aware you want to look at HUD home. Conventional and VA financing are next to impossible to get with these home. Depending on the state of the home, an FHA loan is possible, as are s few rehab loans. This seems like tons to think about it, but I will try to summarize some tips to help the average buyer with the process. If you want more information than I have provided, I would be happy to discuss it with you further:
Tips for bidding on HUD Homes:
1. Check to see how long the property has been listed (ask your Realtor). You may be able to negotiate more "Buyer friendly terms" on a "stale" property (i.e. closing cost assistance or less than the asking price)
2. Properties in the best condition go for the highest price with the least amount of fees or closing costs paid by HUD.
3. HUD is looking for the bid with the highest net. Asking for all buyer fees paid and a lower price can reduce the chance of getting the bid accepted. If the house is great and listed low, you can always offer a little higher than the asking price if you really need closing cost assistance or just to increase your chance of obtaining the property
4. Check (ash your Realtor to do this) to see if the property has "popped" back on the market. This may give you clues as to the prior offer.
5. Investors: have an equity line ready and pay cash for the property....finance it later...it will make your bid look stronger
6. Properties with IE (insurable with escrows) and UI (uninsurable) are not for the "no cash" buyer. These properties are hard to get financing for and require time, effort, and money.

HUD properties are not for everyone but they are a great investment for the right buyer. HUD will only work with agents, so make sure you pick an agent with experience in this area. HUD is very particular about time frames, bid presentation, and their rules and addendums. If your agent is unfamilar with any of these things, the chances of your bid getting through are small. I hope this helped!

If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

Ocean Lakes Subdivision in Virginia Beach

2008-07-11T14:32:00.002-04:00

This post is going to be a discussion of one of my favorite neighborhoods in Virginia Beach: Ocean Lakes.
I am a current resident in Ocean Lakes. I have sold several homes and listed in this neighborhood. I think it is a great place to raise a family. It has a feel of community and safety. I have wonderful neighbors who have helped me out numerous times in the three years I have lived in my hime, with lawnmowing, etc.. The common areas feature many lakes, playgrounds, tennis courts, and pools. The pools are great in the summer, though a bit crowded on the weekends. If you are a beach person like me, its a great location: 5 miles from the oceanfront and 5 miles from Sandbridge. There is not too much jet noice, which I am a supported of! For people with kids, I am always seeing kids on bikes, playing ball, or playing at the playgrounds. It is also located by several desirable shopping centers and a nice movie theater. Some of my favorite restaurants in the area are Tilted Table, Havanna, El Tapitio, Outback, and Malibu Macs. There will be an Olive Garden soon as well. There is also great shopping with both Target and Walmart nearby as well as Home Depot, Bloom, Farm Freshes, and several small business. There are 2 great hair salons Twist and Rumors. Oceana is right around the corner for military commuters. I have really enjoyed this neighborhood and recommend it to all my buyers. You can purchase a townhome or condo in the area for a little as $160,000 or you can buy a nice home with a good yard for up to $450,000. It is a neighborhood for a family of any budget.

If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

People Look at Houses but They Buy "Homes"

2008-06-30T16:58:00.002-04:00

Today's post is going to be a little less formal. I want to, in this blog, discuss real estate in both formal and informal ways. I will at times offer up a Realtor's perspective and at other times, due my best to be impartial and just give facts. In my opinion, the best way to navigate this strange market we are in is to take advantage where you can adn make the most of what you have.
As a buyer, you have so many houses to choose from. You should look at several, pick a top 3, and see what kind of deal you can get. I advocate a little low-balling. I advise my customers to test the waters with their first offer, their "dream" offer, by offering 10% less then the offered price at most (anything more is insulting). I also recommend that they, in this initial offer, list everything they can think of in the contract that would make this an ideal transaction for them, such as new carpet, paint, repairs, etc.. From this initial offer I usually advise them to pick what features are most important and those they can live without, such as would they prefer $10,000 off the asking price or $10,000 in closing cosat assistance and from this point we can get everyone involved satisfied. But keep in mind, as the saying goes, you know its a good compromise if no one's happy.
For my sellers I advise them to make the best of what they have. I tell them to make their home sparkle. No buyer will admit this, but a stunning home (in perfect cosmetic shape) that needs a few minor repairs (such as leaky faucet etc.) listed at a reasonable/slightly higher price will sell so much faster than a homethat is "dated" at a reduced price. The better your house looks and the cleaner your house looks the more buyers will consider it. Another small feature that plays a big part in selling a home is smell. I always tell my sellers to make their homes smell like an inviting home. Burn candles or bake brownies to enhance the "homey" feel. If its winter, dim the lights, light a fire in the fireplace, and decorate (tastefully) for the holidays. Some agents will tell their clients to remove all personal pictures and knick knacks. I say reduce all clutter but keep family pictures out. People look at houses but they buy "homes".

If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

The Pros of Home Warranties

2008-06-23T11:04:00.003-04:00

So many of my clients have a hard time deciding on whether or not they should buy a home warranty. I am a big supporter of home warranties. Being a homeowner is both rewarding and at times expensive. Warranties are a good way to make those unexpected expenses much less painful!

What is a home warranty?
A home warranty is a one year residential service contract that provides repair or replacement coverage for the major operating systems and appliances in a home that fail due to normal wear and tear.

Home Buyers’ Benefits
*Move in with assurance knowing your home is covered.
*You are covered for unexpected home repair or replacement costs on many of your home’s major systems and appliances.
*Coverage is regardless of the appliances’ age, make or model.
*If it can’t be fixed, it will be replaced.
*It only takes a phone call and a small service fee to fix the problem.
*Service is available 24 hours a day, 365 days a year.
*You’ll have budget protection knowing you only have to pay a nominal service fee per trade call.

Home Sellers’ Benefits
*Sell with confidence.
*Having a home warranty as an additional feature will give you a competitive edge over other homes on the market.
*Buyers have more confidence in your home and there is usually less negotiating in getting closer to your asking price.
*If something breaks after the sale, there is limited liability for you. Buyers will contact the warranty company rather than calling you.
*Protect your budget, one major breakdown before or during the sale of your home can be very costly and delay things.

One of the few times a home warranty may be unnecessary is if you have bought a new home. A new home will be under the builder's warranty and all of the appliances should have the manufacturer's warranty for at least the first year. A warranty is essential when you appliances hit the eight year mark.

If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

Home Sellers Report Versus Home Inspection

2008-06-16T09:24:00.002-04:00

I work very closely with Homebuyers Inspections in Virginia Beach. They are a very fair home inspection company that consistently does good work. In real estate, consistency is a hard thing to come by!
They wrote an article on Home Inspections (inspections paid for by the buyer where the buyer is the client for the inspector) and Home Sellers reports (paid for by the seller before a contract comes in). In this tough market where everyone is accepting terms that may at times stretch their budget, a home seller report is the way to go. It prevents possible deal-breaking problems for both buyers and sellers. Sellers get a jump on required repairs and buyers don't need to pay for a home inspections. Everybody wins...... There is a more detailed article on the Homebuyers web page, but here are the general pros of a Home Sellers Report:
Benefits of the HomeSellers Report
1. No more surprise "deal killers" i.e. PB, old roofs, moisture damage, etc.
2. Every ratified contract is a final contract. No re-negotiating after the Home Inspection.
3. Sellers gain control of: Who will do the inspection. When the inspection will be done. What will or will not be corrected. Who, how or when any repairs will be done . Will the item be repaired, replaced, removed.
4. No more sitting through painfully long home inspections
5. No more arranging for repairs
6. No more lost market time dealing with buyers who aren't going to buy the house anyway
7. Buyers feel more comfortable making an offer
8. Buyers have more trust in the selling and listing agents
9. Buyers perceive added value. They don't have to pay for the inspection, take off work to attend the inspection, negotiate repairs, etc.
10.Less Stress, more amicable transactions
11. Allows your agent to more accurately predict your ultimate closing expenses and net cash.

If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.

Hello World

2008-06-13T16:36:00.002-04:00

Hello World!
I am told this is how you enter the blogging world, with a big, open-ended hello. My name is Liz Germanos, I am a Realtor in Virginia Beach. I have started blogging for a number of reasons. I of course hope to meet new clients and network, but I truly want to spread awareness about how to be an informed buyer or seller in today's oddball market. I hope through the many blogs to come, I can help prepare the average person for what the real estate process is like. Of course my expertise is mainly in the Hampton Roads area of Virginia, especially Virginia Beach, but I am not ignorant of what is happening throughout the country. If some of my blogs appear a little too upbeat, its because the real estate market in Virginia Beach is still holding strong. Our foreclosure rates are far below the national average and our home prices are not dramatically falling. Sellers in this area are paying some closing cost assistance, reducing the prices of theirs homes reasonably, and offering, at times, home warranties as well. The market in the area I work in is hanging in there. So, like I said, if I seem a bit too optimistic, its because of the area I work in.
I will put alot of planning and researching into my blog topics so I hope this helps anyone considering buying a home.
If you have any questions about this post or want to continue this discussion beyond the customary comment, email me at lizgermanos@yahoo.com. If you are interested in real estate in Hampton Roads and need an agent to guide, please feel free to also email me.