Bullhead City Blog » National Real Estate

Home Buyer Tax Credit 3.0

Evan Fuchs — Sat, 07 Nov 2009 03:23:40 +0000

After much speculation, anticipation, deliberation, and more than a few premature declarations, the home buyer tax credit has officially been re-upped. Again.

First introduced in July of 2008 with the Housing and Economic Recovery Act of 2008, the home buyer tax credit initially acted like an interest-free loan of up to $7500.

Next, in February of 2009, a new and improved home buyer tax credit was born under the American Recovery and Investment Act of 2009. The credit was bumped up to a max of $8,000 and no longer had to be repaid. First time buyers were treated to a gift, err, tax credit equal to 10% of the purchase price on homes purchased after January 1, 2009 and before before December 1, 2009.

On November 6, 2009, The Big O signed The Worker, Homeownership, and Business Assistance Act of 2009 into law and the home buyer tax credit has once again been reborn.

This new version of the home buyer tax credit is bigger and badder than ever. Here are a few key points:

First time buyers (haven’t owned a primary residence for 3 years prior to purchase) may be eligible for a tax credit of 10% of the purchase price, up to $8,000.
“Move up buyers” (have used their existing home consecutively for 5 of the last 8 years prior to purchase) may be eligible for a tax credit of 10% of the purchase price, up to $6500.
Maximum purchase price is now $800,000.
Tax credit applies to purchases under contract by April 30, 2010 and closed escrow by July 2010.
Maximum income limits are $125,000 for single and $225,000 for married tax payers.

I’m just highlighting some relevant points here, this list is not meant to be exhaustive. Keep in mind the home buyer tax credit is only one part of an Unemployment Bill. Yes, unemployment.

Here are some other resources you might want to check out to learn more about the home buyer tax credit:

White House Fact Sheet: The Worker, Homeownership, and Business Assistance Act of 2009

National Association of REALTORS Home Buyer Tax Credit Change Sheet

National Association of Home Builders Home Buyer Tax Credit Site (great resource so far, hopefully will be updated soon to reflect new changes)

And of course, please realize that I’m not a tax guy. Check with a tax expert for advice.

Help for Homeowners

Evan Fuchs — Fri, 27 Mar 2009 05:47:06 +0000

I got a call from local homeowner this week who read my column in the Economic Development Journal of Mohave County. He is behind on payments and in a negative equity position – he is “upside down.” He is not alone.

The Treasury Department recently released details of President Obama’s Making Home Affordable program, aimed at helping struggling homeowners who are making a “good faith effort” to make their mortgage payments:

Making Home Affordable is part of President Obama’s comprehensive strategy to get the housing market back on track. Through the Making Home Affordable Program, up to 9 million American families may be eligible to refinance or modify their loans to a payment that is affordable now and into the future.

In addition to refinancing and loan modifcation assitance, the plan also seeks to boost the housing market by injecting a few billion dollars into Fannie Mae and Freddie Mac in support of low interest rates.

Homeowners who are current on their payments but unable to refinance to a lower rate because the value of their home has decreased may be eligible for Home Affordable Refinance. Follow the link to find out if you may be eligible. Your current loan must be owned or guaranteed by Fannie Mae or Freddie Mac to qualify. Of course, most of us have no idea if we have such a loan. Here’s how to find out:

Does Fannie Mae own my loan?

Use the Fannie Mae Loan Look Up tool or call 800-7FANNIE between 8am and 8pm EST.

Does Freddie Mac own my loan?

Use the Freddie Mac Loan Look Up or call 800-FREDDIE bewtween 8am to 8pm EST.

Remember, this option is for homewoners that are current on the payments.

Borrowers that are behind on payments may be eligible for Home Affordable Modifications. Homeowners who are current may also be eligible.

If you fall into any of the scenarios above, I hope you’ll check into these user-friendly resources. You’ll be asked a series of preliminary questions to determine eligibility, and then you’ll be presented with a checklist and additional information on how to proceed.

I tested the Fannie Mae tool and was presented with the following:

Match Found.

Based on the property information entered, it appears Fannie Mae owns a loan at this address. A “Match Found” status does not guarantee or imply that you will qualify for a Making Home Affordable refinance or modification.

If you’re interested in a refinance, please contact your mortgage lender or servicer (the organization to whom you make your monthly mortgage payments) to confirm these results and ask about the Home Affordable Refinance Plus program.

You can find more information at MakingHomeAffordable.gov

View Frequently Asked Questions for this Loan Lookup tool.

Thank you for contacting Fannie Mae

It took all of about 30 seconds.

The Freddie Mac look up tool wanted my social security number and I didn’t feel compelled to share since I was only taking a test drive.

I hope this information will its way to people in need of help. Pass it on.

Low Down on the Home Buyer Tax Credit

Evan Fuchs — Thu, 19 Feb 2009 10:28:09 +0000

I’m from the government and I’m here to help you.

It’s official. The stimulus bill, aka “American Recovery and Investment Act of 2009″ was signed into law on Tuesday complete with a revamped home buyer tax credit, or as I affectionately call it: free money.

Should the government step in and give people money for buying a home? Is it right or fair? What about people who bought a home under the first incarnation of the home buyer tax credit? What about folks who bought before any such tax credit?

Worthy questions. But now that it’s done, the question of the day is how does it work?

Dear Bullhead City Blog reader: If you know anyone who has not owned a home in the last three years, please take a moment to share this article with them. Thanks.

The Check is in the Mail

If you have not owned a home (principal residence) in the last three years you quite likely qualify for the tax credit (free money) if you buy a home before December 1, 2009. Here’s how it works:

For qualified home buyers, take the amount you would owe in income tax when you file your tax return and subtract the home buyer tax credit from that amount. If you would owe $10,000 in income tax before the home buyer tax credit, and you get the full $8,000 credit, the reduced amount would be $2,000.

More amazing is that if your tax credit is greater than your taxes owed you will get an actual check from Uncle Sam for the difference!

If you owe $2,000 before the tax credit, minus $8,000 tax credit, you get a refund check for $6,000.

Note this is not a tax deduction reducing the amount you are taxed on, but a credit reducing your taxes owed.

How is the new home buyer tax credit different than the last one?

The tax credit now in effect applies to homes purchased between January 1 and December 1, 2009. The two biggest differences between this tax credit and its predecessor, the Housing and Economic Recovery Act of 2008, is that the repayment requirement has been removed and the amount increased from $7500 to $8000. The actual amount of the tax credit is 10% of the purchase price of the home, up to the cap of $8,000, and is available to first time home buyers who meet the income requirements of $75,000 for single taxpayers and $150,000 for married tax payers filing joint returns.

We now pause for a message from the CYA department:

I am not a tax guy, CPA, tax attorney, or bookkeeper. I am passing on information as I understand it. I strongly encourage you to seek further information from a qualified tax professional.

It sounds too good to be true

I’ve been in real estate for almost thirteen years and I’ve never seen an opportunity like this for first time home buyers. There are site built houses on the market in Bullhead City right now for less than $80,000. A qualified first time buyer with a 10% down payment could get the entire down payment back with their next tax return. This combination of affordable prices, low interest rates, home selection, and free money for down payment via the home buyer tax credit is a whopper.

Please help spread the word. The window of opportunity to take advantage of this is pretty small and the press on the stimulus bill has been pretty confusing.

Bonus Tip: Home purchase in 2009 can be claimed on your 2008 return

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.

See the entire Frequently Asked Questions About the Home Buyer Tax Credit for loads of great info and answers to all your questions or shout if I can help.

Stimulus Bill Passes Senate with Modified Housing Credit

Evan Fuchs — Sat, 14 Feb 2009 19:22:25 +0000

It’s been pretty difficult to keep or make sense of the most recent mega-billion dollar stimulus proposal, but it’s now passed the Senate and expected to be signed into law by President O soon.

Home Buyer Tax Credit Modified

So it appears the temporary tax credit for first time home buyers will get bumped up from $7,500 to $8,000, and the provision requiring the tax credit to be repaid is gone. In other words, instead of it acting like an interest-free loan, it will act like a gift. A freebie. According to CNN

Temporary credit for home buyers: The bill increases the size of an existing temporary and refundable first-time home buyer credit to $8,000, up from $7,500. It also removes the requirement under current law that the credit be paid back if the buyer stays in the home for at least three years. And it would extend the credit’s expiration date to Dec. 1, 2009, from July 1. Those eligible for this credit must have purchased a home after Jan. 1, 2009, and before Dec. 1, 2009.

The full credit is available to those making $75,000 or less ($150,000 for joint filers). Estimated cost: $6.6 billion.

For better of worse there’s free real estate money on the table

At over 1,000 pages (yikes!), this stimulus bill is a hard one to swallow. Watching the same old politics unfold, reading about all the “pork”, the lack of transparency, honestly, who the heck knows what’s in the bill or how it will affect us. Hey, I’ve got a question. Where’s the $800 billion coming from? Just wondering.

I did a write up at the end of last year identifying 6 real estate mistakes for 2009. Missing out on freebies was #1:

When someone offers you something for nothing with no strings attached (and his name is Uncle Sam), please accept.

I wish I had made it #2 so I could bump it up to #1.

Mini Real Estate Booms?

Evan Fuchs — Fri, 16 Jan 2009 23:25:47 +0000

This article from the National Association of REALTORS daily news caught my eye:

10 Cities Boasting Mini Sales Booms

Las Vegas
Sacramento, Calif.
San Diego, Calif.
Los Angeles
Detroit
Phoenix
San Francisco
Washington, D.C.
San Jose
Atlanta

More relevant than the list itself were the first few paragraphs:

Some cities that were hardest hit by the real downturn are experiencing mini sales booms.

Las Vegas real estate properties are down 28 percent in price, but sales of homes are up 15 percent.

Motivated buyers accounted for 64 percent of Las Vegas sales in October, says Radar Logic, a derivatives firm. That’s the highest rate in the country.

“There’s a pretty active housing market, it’s simply at a lower-priced inventory,” says Michael Feder, chief executive of Radar Logic. “And there are now bidding wars taking place over homes in foreclosure.”

This sounds familiar.

6 Real Estate Mistakes People Will Make in 2009

Evan Fuchs — Mon, 15 Dec 2008 15:41:19 +0000

With less than 2 weeks until Christmas, a new year is right around the corner. As we’re putting the finishing touches on one of the wildest years ever, and planning for next year, I’ve got real estate on my mind.

Here are 6 real estate mistakes people will make in 2009 – and how to avoid them.

1. Missing out on Freebies

When someone offers you something for nothing with no strings attached (and his name is Uncle Sam), please accept.

The federal government has shown a knack for pushing through unlikely legislation in times of uncertainty. Your mileage may vary, but the Housing and Economic Recovery Act of 2008, which was passed in July, includes a little-known nugget authorizing a $7,500 tax credit for first-time home buyers. An even lesser-known bit is that you don’t literally have to be a first time home buyer to qualify. That’s right, you could purchase your first or 47th house before July 1, 2009 and so long as you have not owned a principal residence in the three years prior to the purchase, you too can qualify for the tax credit that works like an interest free loan paid back over fifteen years. Do me a favor and read that again and then tell everyone you know. It’s too good to keep secret.

2. “They aren’t making loans anymore”

Untrue. It might be more correct to say that they aren’t making loans to people with bad credit, no money, no job, and essentially no ability to repay. The truth is it is harder to get a loan than it was a few years ago – and rightfully so. Turns out “fogging a mirror” is not a sound form of qualifying a borrower.

3. “It’s going to be a buyer’s market for a long time”

This is a biggie. The mistake here is not whether or not you know when the market will balance out or shift to a seller’s market, but thinking that you should wait for it to do so. Is it going to be a buyer’s market for a long time? Who knows? Everyone has an opinion, but the fact is that it is a buyer’s market today. Do you want to be a buyer in a buyer’s market or a seller’s market?

4. “Prices will go down further”

Like it’s ugly cousin #3, this one is a mistake because by the time you get invited to the party, it’s over (Wouldn’t it be nice if a memo was issued 30-60 days before the bottom). Unless you’re thinking of flipping (please think again), you know that real estate is a solid long-term investment. If it happens to go down another few points before going back up, does it affect you if you’re not cashing out? Again, if you wait and buy in an appreciating market, sellers will be much less open to negotiating and choices will be fewer.

5. Missing out on killer interest rates

Holy moly. I hold in my hands a rate sheet I received earlier this week from a local mortgage broker with a 30 year fixed rate of 4.875%. US Treasury bonds have been going gangbusters, pushing the yield down to crazy, historic lows. When investors start dabbling in riskier investments again, will these rates still be around? I don’t know, but I do know if your rate starts with a 4 you’re looking good. And remember the rule of thumb: When interest rates go up one percent, your purchasing power goes down ten percent.

6. Looking for the next worst thing

This is a pet peeve of mine, so stop me if I drift into rant mode. I just have this to ask: Are we tired yet of being on DEFCON 1, always on the lookout for the next worst thing? Whether it’s checking our retirement accounts every 13 seconds, or fixating on CNN’s scrolling ticker of doom, we just couldn’t seem to get enough this year.

What we focus on tends to expand. And there’s still only 24 hours in a day. The more time we spend on things we can’t control, the less time we have left to spend on things we can control. How many positive things might you have missed while focusing on the negative in 2008?

…and how to avoid them

Here some useful ways to avoid making these real estate mistakes in 2009 (links included!).

Stay up on interest rates – Freddie Mac Weekly Primary Mortgage Market Survey reports national average interest rates every week. A summary can be found on the front page of Bullhead City Blog. These are national averages. Looking for current rates? Here’s a link to one of the big guys. I suggest you talk to a local lender for accurate and personalized information.

Freebies – Learn more about the First Time Home buyer Tax Credit from National Association of Home Builders. There very well may be more incentives coming in 2009. Talk to your REALTOR about new or pending changes.

Monitor local real estate trends and statistics – Remember there is no “national real estate market.” The best way to empower yourself is to stay up on the local market. Check out Bullhead City Blog for current market information, subscribe to receive updates, or download The Informant for free.

The common denominator

You may have picked up on it by now. The key to avoiding these 6 real estate mistakes is to arm yourself with reliable information. Opportunity is abound. Surely there are lots more mistakes to dodge, but avoiding these 6 mistakes will help you make informed, responsible, and profitable decisions in 2009.

Fed Chair Wants More Done to Stop Foreclosures

Evan Fuchs — Thu, 04 Dec 2008 19:05:17 +0000

Deciphering the “global market crisis” is like the mensa version of herding cats. However, we do know that real estate foreclosures are wreaking havoc that goes far beyond your neighborhood. So it won’t knock you off your chair when you read that when it comes to stopping foreclosures, Ben Bernanke has this to say:

“More needs to be done.”

Oh.

As someone who has had the repeated and unenviable task of trying to get hurting borrowers and their lenders together all year, I have this to say:

Attention Lenders: Talk to your home owners. Now.

We know by now that when push comes to shove, home owners will walk away. In many cases there isn’t a whole lot of pushing and shoving, they just do it, but there are lots of well-intentioned, honorable folks who want to do the right thing. Sadly, lenders are not making it easy.

What is the right thing? Well, it’s up to you, but imagine this:

You loan me $100,000 to buy a house and I put that house up as collateral. We agree on some payment structure and off we go. Some time later I lose my ability to make the agreed upon payment. It’s only been a couple of years so I still owe you pretty close to the original $100k.

I’m a decent guy and when I make a deal, my word is my bond. Still, can’t get blood from a stone, so we are at a crossroads.

I come to you: “Hey, remember our deal? I meant to keep my promise, and I really want to, but I just don’t have the money to make those payments. If I never give you another penny, you can take my house. Of course, there will be costs involved in doing that and lots of legal stuff, but that is your right of recourse. Oh yeah, I would sell the thing to pay you back, but it’s only worth $70,000 now, and of course there are costs involved there, too. When it’s over I would probably only be able to give you $60,000 or $65,000, tops.”

Things are not looking good for either of us at this point. You can settle for 60-65% of the hard-earned dough you shelled out, or you can foreclose (and hope I leave the place in shape). Then you’ll need to babysit the house while you wait for it to sell, pay for utilities, and so on. Let’s say you’re able to get the amount I might sold it for, you might end up with 50-55% of your money in the end. Ouch.

And me? My credit doesn’t look so good anymore and I need to find a new place to stay. So much for the American Dream, I’ll probably rent. Ouch again.

But wait! Rewind.

What if instead we sit down at the kitchen table with a legal pad and scratch out a new deal?

Loan modification

We’re both losers if you foreclose, so maybe we can put our heads together. Maybe you can lower the principle balance, or the interest rate, or extend the term of the loan, or a combination of all of those – all of which would reduce my monthly payments. Lowering the principle balance might sound “unfair”, but it would increase my equity and make walking away less attractive.

As Mr. Fed said:

Principal write-downs may need to be part of the toolkit that servicers use to achieve sustainable mortgage modifications…

We both have stakes in the game that need to be considered. If I lose, you lose. Remember, I can walk away. Please don’t tempt me!

You get the point. If you and I get it, what’s going on? I am here to tell you that communicating with lenders on this topic is extremely difficult and frustrating. I won’t go into detail today, but it’s bad and needs to get better on their end and fast. The longer it takes, the more likely the borrowers are to get fed up and give up and yes, walk away.

Let’s stop herding cats and have a seat at the kitchen table.

You Don’t Have to Be a First-Time Home Buyer to Get a $7500 Tax Credit

Evan Fuchs — Tue, 18 Nov 2008 19:01:31 +0000

You may have heard about the temporary tax credit available to first-time home buyers as part of the Housing and Economic Recovery Act of 2008.

What you may not have heard is that along with first-time home buyers, the IRS includes anyone who hasn’t owned a home in the previous three years. From the IRS website:

Taxpayers who owned a main home at any time during the three years prior to the date of purchase are not eligible for the credit. This means that first-time homebuyers and those who have not owned a home in the three years prior to a purchase can qualify for the credit.

When you hear “first-time buyer”, don’t you think of someone who has never owned a home? Not so in this case. Good to know.

Before reading on, please understand that I am not a tax guy. I’m not a CPA, tax attorney, or bookkeeper. I am passing on information as I understand it, including the imaginary and fictitious example that follows, but I strongly encourage you to seek further information from a qualified tax professional. Whew.

Tax credit NOT tax deduction

Unlike a tax deduction which reduces your taxable income, a tax credit actually reduces your income tax directly.

For example, let’s say you had an adjusted gross income (AGI) of $35,000 and an overall tax liability of 25% or $8,750. A $1,000 tax deduction would reduce your AGI to $34,000, which would reduce your tax liability to $8,500, saving you an additional $250. On the other hand, a tax credit of $1,000 in the same example would reduce your tax liability to $7,750, saving you the full $1,000. That’s better!

While tons of tax deductions can be found within the convoluted maze that is our tax code, tax credits are few and far between.

Temporary tax credit similar to interest-free loan

The temporary tax credit, which is available to qualified individuals on qualifying purchases made between April 9, 2008 and July 1, 2009, acts very much like an interest-free loan.

The credit is 10 percent of the purchase price of the home, with a maximum available credit of $7,500 for either a single taxpayer or a married couple filing jointly. The limit is $3,750 for a married person filing a separate return. In most cases, the full credit will be available for homes costing $75,000 or more. Whatever the size of the credit a taxpayer receives, the credit must be repaid over a 15-year period.

Although The National Association of REALTORS has urged Congress to eliminate the provision that requires the tax credit to be repaid, there has been no change to that provision as of this writing.

Other things you need to know about the tax credit

Like any good piece of tax code, there are some other qualifications and restrictions. Some of the caveats include:

Income restrictions – Yes, there is a maximum income limit to qualify for the credit, but you might be surprised how high it is. Joint filers can have a modified adjusted gross income of $170,000 and still qualify.
Primary residence – Not intended for rental or or vacation properties.
Arms length transactions – The purchase of the property must not be from a close relative.

There are other restrictions that must be met in order to qualify for the tax credit. Be sure to visit the IRS site for more info. You might want to check out The National Assocaiton of Home Builders site, too. And last, but not least, please check with a tax professional first to make sure you will be able to claim the tax credit.

This temporary tax credit creates a fantastic way for soemone to become a homeowner, but I haven’t heard much talk about it. If you know of someone who may be interested in taking advantage of this unique opportunity, please let them know about it. It’s this first time anything like it has been available to my knowledge.

U.S. Govt. to Take Over Fannie Mae and Freddie Mac

Evan Fuchs — Sat, 06 Sep 2008 17:09:59 +0000

I’m from the government and I’m here to help

The Wall Street Journal reported yesterday that the U.S. government is expected to place Fannie Mae and Freddie Mac “into the conservatorship of their regulator, the Federal Housing Finance Agency.”

Conservator: a person, official, or institution designated to take over and protect the interests of an incompetent.

Ouch.

So why is the government stepping in?

A couple of years ago, the idea of Freddie or Fannie failing would have been unthinkable. They are THAT big. However, stock in the two Government Sponsored Enterprises has nose dived 80% in the last 3-4 months and they have lost BILLIONS of dollars in the last year:

Freddie and Fannie own or guarantee more than $5 trillion of mortgages. They have suffered combined losses of about $14 billion over the past four quarters as they make provisions for a wave of defaults. Investors worried that a government bailout would wipe out the value of existing stock, and those fears have sent the shares down about 90% from a year ago. Many U.S. banks as well as foreign governments own stock or debt in the two giants, meaning their financial woes could cause broad problems beyond the housing market.

Read the entire Wall Street Journal article

The fact is that these two giants either own or guarantee half of our country’s outstanding mortgage debt.

While this story is a big one, it’s not quite a shock by now. The government has been taking a hands-on role all year as we navigate through unprecedented economic times. With Fannie and Freddie so deeply intertwined into our national debt, it’s no wonder. But is more government intervention the answer? And you gotta wonder, once they show up to the dance will they ever leave?

Help for Homeowners

Foreclosures, Not in Our Town!

Evan Fuchs — Wed, 23 Jul 2008 23:01:44 +0000

Too many foreclosures in your city? San Diego thinks so, and they’re suing Bank of America/Countrywide for engaging in predatory lending practices which they allege has contributed to their growing number of foreclosures. This according to the Union-Tribune:

San Diego City Attorney Mike Aguirre is taking on the lending industry, filing suit Wednesday against Countrywide Financial, which he accuses of engaging in unlawful and fraudulent predatory lending that victimized numerous San Diego home buyers.

I won’t comment on Countrywide in particular, but certainly lenders are at least partly to blame for people walking away from their loans (and houses). There were a lots of loans dished out to people who couldn’t afford them. As long as the collateral kept appreciating it wasn’t a problem, but if not…

Making loans to people who couldn’t afford them proved to be a risky business

OK, so if lenders are partly to blame, someone else must also be partly to blame, right? How about the borrowers? Just as loaning money to people who can’t afford it is dangerous, so is borrowing money when you can’t afford it. The truth is that some lenders probably used predatory practices; some not nice people did not nice things to nice people. However, many loans were made by lender and borrower mutually agreeing on the terms and the borrower’s creditworthiness (wink wink).

For their part in these deals-gone-bad many borrowers stop paying. In turn, the lender takes their house. Seem reasonable? Not to San Diego:

In a press conference held in front of a vacant, partially burnt Skyline home that has recently been taken over by Countrywide, Aguirre said he hopes his suit will be a way to bring other lenders together to work out settlements with borrowers who are about to lose their homes or who already have been foreclosed on.

“We are asking that any additional foreclosures be stopped and that the parties come together and work out a reasonable alternative based on the values of these properties today so we can stop the spread of this foreclosure disease,” said Aguirre, flanked by Assemblywoman Lori Saldana, San Diego police officers and other members of his office. “We want San Diego to be a foreclosure sanctuary.”

While Aguirre said he also plans litigation against other lenders, including Washington Mutual, Wells Fargo and Wachovia Corp., he said his main goal is to resolve the issue of growing foreclosures “in an orderly way.”

San Diego wants to be a foreclosure sanctuary and who can blame them? Foreclosures are bad for the neighborhood (and the overall community, and city, and county…). They drive prices down and let’s just say they’re usually not the nicest house on the block. They’re also bad for the both the borrower and the lender. So Aguirre is actually on to something with this:

…the parties come together and work out a reasonable alternative based on the values of these properties today…

Talk about a “win-win” situation. If the lender and borrower can get together and modify their loan, maybe the borrower can keep their property. The last thing the lender wants is to take the property back anyway. It’s going to cost them a whole bunch to foreclose and then turn around and sell it.

Unfortunately, while loan modification seems like the way to go, I’m not hearing many success stories. What I am hearing from clients here in Bullhead City and across Arizona are lots of frustrated homeowners who can’t even get an interested human on the phone to talk about it.

I’m no fan of litigation. I don’t know of any win-win stories that end with “…thank goodness they sued us”. What I do know is that if lenders and borrowers could come together to work out their mutual problem, foreclosure numbers would go down and that would be definitely be a win-win situation.