Now that you’ve received all of your W-2s and 1099′s, home buyers who purchased a San Mateo home in 2009 are starting to think about their taxes so they can (hopefully) get some money back from the IRS with the home buyer tax credit. Several clients have asked how to claim the home buyer tax credit. Here are some tips.

No e-File Allowed

Because of all of the fraud surrounding the credit, the IRS is not allowing tax payers claiming the home buyer tax credit to e-file because of the additional documentation required.

Additional Documentation Required

Along with your regular tax forms, you must attach Form 5405 with a copy of the HUD-1 Settlement Statement. (You received this from the Title Company when you signed the loan documents at closing.)

Trade Up Home Buyer? More Documentation Required

Remember, to claim the $6,500 trade up home buyer tax credit, home owners must have lived in their primary residences for at least 5 consecutive of the past 8 years and be purchasing a new primary residence.

To prove you’ve been in your home for 5 consecutive years, you will need to provide one of the following covering 5 consecutive years in the last 8 years in addition to Form 5405 and your HUD-1 Settlement Statement:

• Form 1098, Mortgage Interest Statement or substitute
• Property tax records
• Homeowner’s insurance records

Need More Information About Filing the Tax Credit?

Remember, I am a San Mateo Mortgage Advisor helping San Mateo home buyers with their mortgage needs, NOT an income tax specialist. So, for more questions contact your Tax Advisor or visit the IRS webpage.

If you need a recommendation for a tax advisor, send me an email at info@SanMateoMortgageBlog.com and I can recommend someone to you.

Related posts:

1. Top 10 Questions about the Extended and Expanded Home Buyer Tax Credit Part 1
2. California’s New Home Buyer Tax Credit
3. Federal Home Buyer Tax Credit Not Just for San Mateo First Time Home Buyers Anymore
4. Top 10 Questions about the Extended and Expanded Home Buyer Tax Credit Part II
5. Slide Show – Guide to the Extended and Expanded Home Buyer Tax Credit

Considering a Price Reduction? There May Be Another Way

If you have been trying to sell your home for a while now and have received no offers, your agent is probably asking you to consider a price reduction. While this is one way to attract a wider selection of buyers to your home, you may also want to consider offering what is called a seller buy down.

What is a Seller Buy Down?

A seller buy down is when the seller offers to pay points, which is a fancy word for upfront mortgage interest, to buy down, or lower the mortgage interest rate for the borrower. Buying down the interest rate will have a much greater impact on the borrower’s monthly payment than a price reduction.

How Will a Buy Down Impact the Borrower’s Monthly Payment More?

Let’s take a look at an example. Say your home is on the market for $780,000 and you’re considering lowering the price by $20,000. Instead, you consider offering to buy down the interest rate for the borrower and you apply that same $20,000 to a rate buy down. By buying down the rate, you can save the buyer $433 compared to the traditional model. This loan only requires $87,356 income to qualify. By reducing the price of the home by $20,000, you only save your buyer $95/month. This loan requires $94,272 income to qualify. With an interest rate buy down, more buyers are able to afford your home, thus more chances to sell your home.

Considering Selling Your Home in this Buyer’s Market?

If you are considering selling your home in this buyer’s market, an interest rate buy down should be one of the techniques you use to competitively market your home. Call or email me today and I can explain how this program works with your situation. Working together, we can get your home sold fast.

Other Posts You May Enjoy

• Stated Income Loans Are Back…But Only With Us!
  
• The New Appraisal Process
  
• 12 Biggest Mistakes Consumers Make When Refinancing
  
• Auto Lock Program Ensures a Seamless Refinance
  
• The Big MAC…and Just as Delicious!
  

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Chris Williamson is a Mortgage Advisor with Mortgage California specializing in San Mateo Mortgage.

Related posts:

1. More Tax Incentives for San Mateo First Time Buyers
2. Federal Home Buyer Tax Credit Not Just for San Mateo First Time Home Buyers Anymore
3. San Mateo Homes Just Got More Affordable for First Time Buyers
4. Two Down Payment Assistance Loan Programs for Home Buyers
5. Mortgage Market Update Week of Feb 23

Update 2/16/2010: Stated Loan Program Has Been Put on Hold Until Further Notice

If you would like to be notified when the stated home loan program is reinstated, please input your name and email into the form below and we’ll notify you as soon as we know more.

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Are you a self-employed borrower looking to obtain a stated home loan for up to $3,000,000? Maybe you have been turned down for a refinance because your net income is too low, but you can afford the monthly payments? Or, maybe you are thinking of buying a new home, but you either don’t qualify for a traditional full doc loan or you qualify for less money than you’d like. You’re in luck…

Stated Loans Up to $3,000,000 Are Back

We are pleased to announce we’re the only lender in Northern California able to offer a true stated loan product for purchases and refinances up to $3,000,000.

What is a Stated Loan?

A stated income home loan allows the borrower to state their income on the application form and the lender agrees not to verify the stated income with pay stubs and income tax returns. The borrower is required to show and verify their assets as well as submit their credit report and FICO score.

Because of stricter lending rules and tighter regulations, most lenders pulled their stated home loan products. For some time, stated loans, which were very popular for self-employed borrowers, were impossible to obtain. Luckily, we are the only lender in Northern California who can offer a true stated loan product to our clients.

Who Would Be Best Suited for a Stated Home Loan?

Generally, self-employed borrowers with business write offs are the best candidates. Write offs decrease a self-employed borrowers net income, which is not factored in when applying for a full doc loan (where they verify your income with tax returns). Therefore, self-employed borrowers tend to qualify for less money, or may not even qualify at all. With a stated income loan product, the borrower is able to qualify for the most possible when purchasing a new home or refinancing their current home.

What Kind of a Down Payment is Required?

This stated loan product requires a 30% down payment on loan amounts to $3,000,000.

What is the Minimum Credit (FICO) Score Required?

The minimum credit (FICO) score required for this stated loan product is 700.

Other Requirements to Obtain a Stated Loan

Some other requirements of the stated loan products:

• Money can be used for a purchase or refinance
  
• Secondary financing is not allowed
  
• Property must be the borrower’s primary residence
  
• Property must be owner-occupied
  
• Property must be a single family residence
  
• Borrower cannot be a first time home buyer
  

What Counties are Eligible?

This stated loan product is available in the following counties:

• San Mateo County
  
• San Francisco County
  
• Marin County
  
• Sonoma County
  
• Napa County
  
• Contra Costa County
  
• Los Angeles County
  
• Orange County
  
• Santa Barbara County
  
• Ventura County
  

Do You Need a Stated Home Loan?

If you would like to explore the possibility of getting a stated home loan for a home purchase or refinance, please call me at (650) 520-0915, email me or apply online with our secure online mortgage application. We’ll take a look at your situation and determine how much you qualify for with no cost or obligation to you whatsoever.

Other Posts You May Enjoy

• The New Appraisal Process
  
• 12 Biggest Mistakes Consumes Make When Refinancing
  
• What Mortgage Can I Afford?
  
• The Big MAC…and Just as Delicious!
  
• Paying Points for Your San Mateo County Mortgage
  

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Chris Williamson is a Mortgage Advisor with Mortgage California specializing in San Mateo Mortgage.

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1. The CIA of Lending: I is for Income
2. New Fannie Mae Loan Program for Foreclosures
3. Maximum Allowed Debt Ratios for San Mateo Mortgage Loans
4. FHA Streamline Refinance Guidelines Changing in 2010
5. CNN Money: Pick-a-Payment Loans Turn Poisonous

If you have been sitting on the fence waiting for the right time to refinance, you definitely fell off the fence this past week as rates rose above 5%. Did you miss your opportunity? Are you starting to kick yourself because refinancing is as attractive as it was a couple of weeks ago? Well hold off on beating yourself up. You may have one last shot at the refinance boom of 2009.

Think Back to December 2008

Let’s turn back the clock to December 2008 when the Fed announced that they were pledging 1.25 trillion dollars to the mortgage markets, rates dropped overnight. This kept the rates low into the new year and have been holding steady at these low limits until now. The commitment to buy mortgage bonds was to last until June and now you are starting to see the rise in rates again as we finish out May. The Fed does not want this rise in rates, at least not yet!

You May Have One More Chance!

Looking at how rates have gone up over the last couple of weeks, I can see two things happening. Accelerating the rate at which mortgage bonds are being bought (there is still about $820 billion left to spend) and/or the Fed pledging more money to purchase bonds. Either outcome will cause rates to drop.

Don’t Let this Opportunity to Save Thousands Pass You By!

If you are sitting around crying in your Cheerios thinking you missed out on a great opportunity, it’s time to suck back those tears, and get your application in. This may be your last great opportunity to refinance in the historic refinance boom of 2009.

How Can I Be Sure to Take Advantage of Some of the Lowest Interest Rates in History?

To apply, please contact me or apply online with our secure online mortgage application.

Other Posts You May Enjoy

• The 12 Biggest Mistakes Consumers Make When Refinancing
  
• Auto Lock Program Ensures Seamless Refinance
  
• The Effects of the Fed Rate Cut
  
• Free Credit Report
  
• Official Launch of the Mortgage Adoption Center
  

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Chris Williamson is a Mortgage Advisor with Mortgage California specializing in San Mateo Mortgage.

Related posts:

1. Mortgage Interest Rates Predicted to Rise in 2010
2. Auto Lock Program Ensures a Seamless Refinance
3. Why Some Home Owners Decide not to Refinance
4. FHA Streamline Refinance Guidelines Changing in 2010
5. How Mortgage Interest Rates Affect Your Monthly Payment

With all the buzz surrounding San Mateo mortgage refinances lately, I have received a lot of questions asking for refinance tips. Bottom line, there are right reasons and wrong reasons to refinance your mortgage. And…when you see too good to be true interest rates, you should ask a lot of questions and get everything in writing (including closing costs) to make sure you aren’t way overpaying in fees.

In the Mortgage Refinancing Mistakes to Avoid guide, I detail 12 common mistakes San Mateo homeowners make when refinancing their mortgage loans and how you can avoid them for a smooth transaction. Here are 2 out of the 12 mistakes to get you started:

Mistake #3: Only Considering the Mortgage Interest Rate When Choosing a Lender

All too often, people choose a lender for the wrong reason. They call around asking for today’s interest rates and decide to go with the person who quotes them the lowest rate over the phone. Although this may sound like the best way to shop for a loan, you could end up paying much more with extra and/or higher fees and charges. Not to mention, unless you have a pre-approval in hand and have already submitted your documentation to a lender, it doesn’t matter what today’s rates are. Rates change every single day and maybe even several times per day and unless you are ready to move forward now, today’s interest rates mean nothing to you.

To protect yourself from paying too much, ask your lender to put everything in writing. We provide our clients a detailed Good Faith Estimate with all of the costs and fees they will pay to close the loan so they can compare our costs with other companies. If your lender will not give you the costs in writing, you should find another lender.

Tip: Don’t just consider the interest rate when choosing a lender. Get their quote (Good Faith Estimate) in writing to compare all of the fees and charges to know if you are really getting the best deal.

Mistake #4: Not Working with a Lender that Will Alert You When There is an Opportunity to Save Money After Closing

When you choose to go forward with The Chris Williamson Team, our service does not stop at closing. We input your loan information into our Mortgage Monitoring System and when there is an opportunity for you to save money on your monthly mortgage payment, or when another loan program would be more suitable for your financial goals, or when you can cancel your mortgage insurance, we will let you know. We also have a yearly mortgage review with each of our client’s so we can evaluate their financial situation to see if any changes need to be made.

Tip: Work with a Mortgage Advisor whose service does not stop when the loan closes. Also, ask your Mortgage Advisor if they will alert you when there is an opportunity for you to save money on your mortgage.

To get a copy of the complete, Mortgage Refinancing Mistakes to Avoid guide please fill out the form below and it will be emailed to you immediately.

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Other Posts You May Enjoy

• Auto Lock Program Ensures Seamless Refinance
  
• Popping and Locking – Interest Rate Style
  
• Why Do Some San Mateo Homeowners Decide Not to Refinance Their Mortgage?
  
• How Will the HR-3221 Housing and Economic Recovery Act of 2008 Affect San Mateo County?
  
• The Mortgage Shopping Guide
  

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Chris Williamson is a Mortgage Advisor with Mortgage California specializing in San Mateo Mortgage.

Related posts:

1. Biggest Problem with New GFE and How to Avoid It
2. One Last Chance to Refinance at Historic Low Interest Rates
3. Why Some Home Owners Decide not to Refinance
4. The New Appraisal Process
5. Auto Lock Program Ensures a Seamless Refinance

Refinancing into a lower rate is a great option for many home owners, but in today’s lending world of tighter guidelines, it may not always be possible. If the home owner doesn’t have enough equity in their home or has credit issues or recently experienced a hardship like the loss of a job, the lender may not refinance the current San Mateo mortgage loan.

Another reason a homeowner may not refinance to a lower rate are due to the costs related to refinancing, which can range from 2-3% of your loan amount. You have to determine how long it will take you to recoup your money and if the new loan program aligns with your financial goals before you consider refinancing your current San Mateo mortgage loan.

For example, if you currently have a 30 year fixed rate home mortgage with a $700,000 loan amount and a 7% interest rate, you are paying $4,657 for principal and interest per month. If your current loan balance is $660,000 and you refinance at to 6.5% interest rate, you will be paying $4,171. This is a monthly savings of $486 per month. If the closing costs are 2% or $13,200, it will take you 27 months to recoup your money. For home owners planning on staying in their San Mateo home for three or more years, it may make sense to refinance. It is also possible to include the closing costs in your new San Mateo mortgage to alleviate the upfront costs, but again, you still have to determine the time to recoup this money and if the benefits are aligned with your overall financial plan.

I hope I was able to clear a few things up for Tyler and you as well. If you have additional questions about refinancing or wondering if it’s time for you to refinance, send me an email or take a look at The Mortgage Adoption Center. In the meantime, I have a great audio CD that I would love to share with you called Home Equity Myths with Douglas Andrew, the author of the popular book Missed Fortune: Dispel the Money Myth-Conceptions – Isn’t it Time You Became Wealthy? In this CD, Douglas dispels many common myths about managing your home’s equity. If you would like a copy, send me an email and I will get the CD out to you.

Enjoyed this Post? Why Not Subscribe?

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Chris Williamson is a Mortgage Advisor with Mortgage California specializing in San Mateo Mortgage.

Related posts:

1. One Last Chance to Refinance at Historic Low Interest Rates
2. FHA Streamline Refinance Guidelines Changing in 2010
3. Auto Lock Program Ensures a Seamless Refinance
4. Hope for San Mateo Home Owners?
5. 12 Biggest Mistakes Consumers Make When Refinancing

The other day I received a question from Tyler who was wondering why consumers are concerned about refinancing into lower interest rates when they don’t have to pay mortgage interest. Tyler explained that he thought all mortgage interest was tax deductible and reduced the amount of taxes you paid.

Unfortunately, the reality of tax deductions is they reduce your taxable income, or the amount of income subject to income taxes, not the amount of taxes you actually pay to Uncle Sam. Let’s say you make $100,000 annually and you paid $20,000 in mortgage interest. Because of the $20,000 you paid in mortgage interest, you can reduce your taxable income to $80,000. If you are in the 28% tax bracket, you will see approximately $5,600 in tax savings (28% of $20,000 = $5,600), not the entire $20,000.

Unfortunately, the reality of tax deductions is they reduce your taxable income, or the amount of income subject to income taxes, not the amount of taxes you actually pay to Uncle Sam. Let’s say you make $100,000 annually and you paid $20,000 in mortgage interest. Because of the $20,000 you paid in mortgage interest, you can reduce your taxable income to $80,000. If you are in the 28% tax bracket, you will see approximately $5,600 in tax savings (28% of $20,000 = $5,600), not the entire $20,000.

Thanks again Tyler for your question. As always, the forum is open to all questions and comments. Feel free to use me as a financial resource.

Thursday’s post will answer the refinance portion of Tyler’s question. We will discuss why a person may choose not to refinance and a few reasons people do not have the ability to refinance.

If you have enjoyed San Mateo Mortgage Blog – Bay Area Mortgage Broker, please subscribe to our RSS feed.

Related posts:

1. Mortgage Interest: A Friend to the Bay Area Home Owner
2. How Mortgage Interest Rates Affect Your Monthly Payment
3. Two New Tax Breaks for the Struggling Bay Area Homeowner
4. One Last Chance to Refinance at Historic Low Interest Rates
5. Why Some Home Owners Decide not to Refinance

I am pleased to officially announce the launch of the

As I explained in last week’s post, the Mortgage Adoption Center is a complimentary mortgage monitoring system that will check your mortgage information is against the latest rates. Whenever there is a refinancing option that can equate to real savings on your home mortgage loan, you are notified.

Are you a Realtor, CPA, Insurance Agent, or Financial Planner looking for a way to touch your database with something of value? Why not send an email blast with the Mortgage Adoption Center Yahoo News story? Yahoo provides a quick form where you can input your email addresses, include a personalized message, and there you go! If you prefer paper copies, send me an email and I will get some postcards out to you.

Out of the area? That’s ok too! I lend in California, Oregon, Washington, Nevada, Arizona and Hawaii.

Thanks to everyone who has already signed up. You will be hearing from me soon!

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Lots of people have been asking me about, and looking for information on, San Mateo reverse mortgage loans. I get a lot of questions about them so I thought that today I would counter a few misconceptions about them.

1. With a San Mateo reverse mortgage, the lender will own my home.


This is absolutely false. You, the borrower and home owner, will retain title to your property. The reverse mortgage lender is simply extending a mortgage loan to the home owner.


Because you are still the home owner, it is still your responsibility to pay the property taxes, pay the hazard insurance, and maintain your home as you would if you had a first mortgage or home equity loan.

2. The reverse mortgage lender will take my San Mateo home away if I outlive the loan.


This is also not true. Nor is the loan due at this time. As long as you remain living in the house as the primary resident and keep the taxes paid, you do not need to repay the reverse mortgage loan at this time.

3. I still have a first or second mortgage on my property and therefore cannot obtain a reverse mortgage.


False. You may still be eligible for a reverse mortgage even if you still owe money on a first or second mortgage. The funds received would be used to payoff whatever existing mortgages are levied on the property.

4. If home prices drop, I will owe more than what the house is worth.


You will never owe more than the appraised value of your house when your house is sold. A reverse mortgage will not affect any of your other assets.

5. My heirs must sell my home in order to repay the reverse mortgage.


Again, false. The repayment of the San Mateo mortgage loan can be satisfied by refinancing the home, or by using other assets.

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Chris Williamson is a Mortgage Advisor with Mortgage California specializing in San Mateo Mortgage.

Related posts:

1. Mortgage Interest: A Friend to the Bay Area Home Owner
2. Two New Tax Breaks for the Struggling Bay Area Homeowner
3. Does Uncle Sam Pay My Mortgage Interest?

The San Mateo Mortgage Blog is proud to announce the launch of the Mortgage Adoption Center or the MAC for short. The Mortgage Adoption Center is for anybody that feels they have been abandoned by their lender, loan originator, Mortgage Broker or the endless amount of names that you may classify as simply, your loan person.

You would be considered abandoned if:

• You have not heard from your loan person since your closing
• You can’t even recall your loan person’s name (which is the reason you refer to them as your loan person)
• Your loan person does not call you every time there is an opportunity for you to save money on your mortgage
• Your loan person does not contact you every time there is a change in the market that may affect you as a home owner

So is adoption in order?…Sign up at the Mortgage Adoption Center and start receiving the top notch attention that you deserve!

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Chris Williamson is a Mortgage Advisor with Mortgage California specializing in San Mateo Mortgage.

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