Life In Bonita Springs

Banks Get The Gold Mine

Consumers Get The Shaft … and

Jesus Loves You

Sometimes actually getting the bank to give a loan modification doesn’t end with the borrower being getting their issues solved.

Loan modifications are an emotional roller coaster. From the day a borrower finally gets a living, breathing human on the phone that promises to send a modification package until weeks down the road when it’s realized that the package is not showing up will totally wring the spirit out of just about anyone.

The fact of the matter is that, at this point, the banks are basically only required to put for an effort by contacting consumers. The administration has required the banks to show good faith to homeowners in default. In order to receive stimulus money, the banks must collect statistics regarding how many distressed homeowners they’ve reached out to but they are not obligated to re-write or modify even one loan.

Occasionally, a bank will actually agree to a modification but since there are few guidelines it’s like playing a shell game for consumers. They struggle through the process only to get finally get their modification and have little if any change to their situation.

My writing life outside of the weekly column consists of managing my own blog that receives comments and contacts from many people that are struggling in one way or another with a housing predicament. A recent correspondence read in part:

Yes I did a loan modification with my lender. I thought that under these Modifications that they were suppose to put “behind payments” at the end of the loan. Well I did end up with a lower interest rate but they tacked on 9,844.46 raising my balance from $125833.82 to $134094.44, because of that I now owe even more. My payment only went down $25.00. PLEASE HELP ME.

What a tremendous amount of time, money and hope was squandered by a loan modification that would only reduce a house payment by a measly twenty five dollars. There’s little doubt that that transaction will go in the “look, we’re a progressive bank and helped consumers” pile for the administration.

The harsh reality about loan modification is that only a little over 200,000 modifications have been offered to date. Compare that tiny sum to the millions of consumers that really do need help and the statistics stink worse than yesterday’s trash.

There are still no mandatory requirements planned for lenders to have to help borrowers who are eligible, currently in default or the unfortunate owners of one of the millions of option adjustable rate mortgages that will reset within the next two years. I’ve already seen the term “Option Armageddon” used in discussion about the situation.

If you’re struggling with loan modification you should know that the only requirement that has happened so far is that as of January 1, 2010 loan modifiers will have to be licensed in the state of Florida, unless they’re already licensed as an individual mortgage broker.

Everyone can rest easy knowing that a license now is required to help consumers get a loan modification from a bank that has no mandatory requirements to help anyone.

###

Real Life in Bonita Springs is a project by Chris Griffith dedicated to writing useful blog posts for consumers about the Bonita Springs, Florida area.  Find out what it is really like to live in Bonita Springs, Florida by reading about our fair city. You’ll get the latest in local real estate information, Bonita Springs real estate market reports and a little bit of humor.  If you have topic ideas, feel free to request a story about the idea, after all, this site is just for you.

You can subscribe to a weekly email newsletter by visiting www.LifeInBonitaSprings.com and entering your email in the subscription area on the left pane of the web page or by adding us to your reader by subscribing to this blog. Oh, and if you’re reading this content anywhere else but www.LifeInBonitaSprings.com or Naples Daily News it is probably stolen.

Geitner Claims The Housing Crisis is Over

If you don’t see the video above CLICK HERE

I am changing the format of this up a little bit to make it work with our site's that we post for, so please work with us as we try this this out.

Mortgage rates have been holding steady for the past couple weeks.  Mortgage applications have increased.  Is this a sign that the market is turning around?  If it is, then you need to act quickly to get the good housing prices and stop rolling the dice when it comes to your interest rate.

This week's mortgage rates:

30 Year Fixed:

Interest Rate - 5.0%

APR - 5.151%

Payment - $805.23

15 Year Fixed:

Interest Rate - 4.5%

APR - 4.757%

Payment - $1,147.49

30 Year Jumbo:

Interest Rate - 5.375%

APR - 5.484%

Payment - $2,799.86

15 Year Jumbo:

Interest Rate - 4.75%

APR - 4.933%

Payment - $3,889.16

Please feel free to share your comments on this new formatting versus the old one with the charts.  I feel that this will be easier to read.  Also, I have taken out the ARM rates, as no one has expressed interest in ARMs.  If you would like a custom quote on ARM rates, please feel free to call me at 352-308-7219.

*The rates published on this page are applicable only to requests received from this site or by calling 352-308-7219. Mortgage rates published on this page are the current rates for a single-family, primary residence based on a 30-day lock period and are subject to change without notice. In order to receive a guaranteed rate, you must have applied for an application through Knightlines Mortgage Services, LLC and received a verbal confirmation from a mortgage broker that your desired rate is locked. Your guaranteed mortgage rate will depend on factors such as current market conditions, loan product, occupancy, property type and your credit profile.

Loan Product and APR Information

• Conforming rates are for loan amounts not exceeding $417,000 ($625,500 in AK and HI)
• Jumbo rates are for loan amounts exceeding $417,000 ($625,500 in AK and HI)
• Adjustable-rate loans and rates are subject to change during the loan term. That change can increase or decrease your monthly payment.
• Additional loan products, rates and lock periods are available.

Conforming Fixed, ARM APR calculation assumes a $150,000 loan amount with a 20% down payment, estimated borrower paid finance charges of .75% of the loan amount plus discount and origination if applicable. If the down payment is less than 20%, mortgage insurance may be needed on the loan. This could increase the monthly payment and the APR.

Jumbo Fixed APR calculation assumes a $500,000 loan amount with a 20% down payment, estimated borrower paid finance charges of .75% of the loan amount plus discount and origination if applicable. If the down payment is less than 20%, mortgage insurance may be needed on the loan. This could increase the monthly payment and the APR.

Jason Price

Owner/Principal Broker

18515 Demko Road

Altoona, FL 32702

(352) 308-7219 Phone

(888) 807-4123 Fax

Maybe You Should Test The System

There’s currently a fair sized pile of printed out property reports on my desk that have been marked up and highlighted from last weeks showings. Almost thirty percent of them have a big black slash across the page. The agents who were supposed to be marketing the properties were unreachable by phone and email. Needless to say, my buyers didn’t get to see the inside of those homes. Was one of them your home?

While attempting to make showing appointments last weekend, I was met with dead email addresses and full voicemail boxes. Sometimes multiple messages were left without even a courtesy return call to acknowledge the message while they attempted to contact the owner or tenant. I have yet to hear back from some of the agents.

If you’re considering selling or maybe even currently selling real estate it might be a good idea to call the appointment phone number for a trial run, especially on the weekend or after hours. Maybe throw a test email out there to see how long it takes for your agent to actually find it.

In this day and age of technology there is absolutely no excuse for a call to go unreturned, an email to be unanswered and showing appointments to not get set. Just about every human being on earth has a cell phone strapped to their hip and should be able to communicate in one way or another with consumers and fellow agents.

Sadly, the majority of the properties I was attempting to show were short sales. It might have not occurred to anyone selling a short sale that if their agent isn’t communicating with agents to get them into the home they’ll probably not be able to communicate effectively with a bank to get the short sale approved.

As I looked through the pile of properties that didn’t get shown it made me sad for the owners that are probably holding on by a thread, just hoping for a buyer. They don’t even realize that the buyers can’t get inside the home. It makes me sad for the responsible, dedicated real estate agents who get a bad rap because of the slackers who aren’t doing their job.

When you, the consumer, sign an agreement to list your home for sale, the agency you choose owes you duties to act in your best interest and actually produce an environment that is conducive to selling your home. That would include answering the phone or returning calls. It’s a violation of your agreement and ethics that they are unable to be contacted by potential buyers or real estate agents with buyers.

You, the consumer, need to protect yourself and your real estate. Don’t be afraid to test the systems to make sure you and your home are being properly represented.

###

Real Life in Bonita Springs is a project by Chris Griffith dedicated to writing useful blog posts for consumers about the Bonita Springs, Florida area.  Find out what it is really like to live in Bonita Springs, Florida by reading about our fair city. You’ll get the latest in local real estate information, Bonita Springs real estate market reports and a little bit of humor.  If you have topic ideas, feel free to request a story about the idea, after all, this site is just for you.

You can subscribe to a weekly email newsletter by visiting www.LifeInBonitaSprings.com and entering your email in the subscription area on the left pane of the web page or by adding us to your reader by subscribing to this blog. Oh, and if you’re reading this content anywhere else but www.LifeInBonitaSprings.com or Naples Daily News it is probably stolen.

Get Ready For The Changes in 1031 Exchanges

By Nace Cohen, CPA

President, 1031 Exchange Connection in Naples, Florida

Here we go again, round two of the great Exchange. We all remember what was going on in the world of real estate a few years back. It was simple, buy low and sell high, with one drawback – the capital gains tax. The solution was easy, do a 1031 Exchange! Well it’s back and for good reason. These days, foreclosures and short sales drive the market in closed sales. Investors are acquiring so low that gains to be made are just around the corner, and they plan on taking advantage by selling for a quick profit and exchanging into more. Is a 1031 that easy? It used to be, however significant changes were made to the code and need to be addressed so you are ready should the IRS want to look at your exchange.

Section 1031 joins together the sale of old “Investment” property with the purchase of new by rolling the gain forward to the new property. The tax that would have been paid gets deferred into the future, a wealth building technique commonly used by real estate investors. There are strict rules to follow regarding property type, timing, title and taxability.

The first thing the IRS will look at is the type of properties exchanged. Both the Old and New properties must qualify as investment or business use. Land always qualifies, as does rental property. Not clearly defined in section 1031 is how long you must hold the property before exchanging it. A new ruling, Rev. Proc. 2008-16, provides a safe harbor for exchanging residential properties and now requires a holding period of two (2) years. The old “year and a day” rule no longer applies. Also, you must rent the property for a minimum of 14 days and cannot use it more than 14 days a year in each of those 2 years. So, if you're thinking of buying a foreclosure, short sale or fixer-upper, and flipping it in less than a year, consult with your tax accountant before doing an exchange.

Another change concerns a tax free strategy commonly used by exchangers when they wanted to retire into property they exchanged into. For example, let’s say you sold land in 2005 and exchanged into a nice Naples condo you wanted to live in someday, but in order to comply with the rules of 1031 you needed to rent it first. You rented it for 2 years, then sold your home up north and moved into the condo. When you sold your old home, you took that gain tax free because under the principal residence exclusion, you can exclude gain up to $500,000 since you are married and lived in the home for at least 2 out of 5 years as a principal residence. Now all you need to do is live in that new condo for 2 years, sell it, and the gain is again tax free since it was your principal residence when you sold it, right? And the gain that was rolled into it from the sale of the land get’s eliminated through the home sale. Super!

Well it used it be that way, and it was a great strategy, that is until the IRS revised it. The IRS says you can still do it, but two (2) things need to occur before you can eliminate any of the gain from tax. First, if you buy a property in a 1031 and later sell it as a principal residence in an attempt to eliminate the gain through the home sale exclusion, you need to hold the property for a full five (5) years before you sell it. This 5 year holding rule only applies if the property you’re selling was purchased in a 1031 exchange. If it wasn’t, then you only need to hold it for 2 years to get the exclusion.

Second, if you sell that 1031 condo, the gain needs to be prorated between the time you held it as investment and personal. Only the personal gain is eliminated through the home sale exclusion, and the investment portion is taxed. For example, in our land/condo example, if you sold that condo at a $500,000 gain, including the rollover gain from the land, and you rented it for 2 years and lived in it for 3 years after, then 2/5 of the gain, or $200,000 is taxable as investment, and 3/5 is tax free. If you live there for 8 years after the 2 year rental period (total 10 years owned), then 2/10 of the gain would be taxed and 8/10 excluded. Therefore, the longer you live there, the less is taxed.

The tax trap here is if the condo was sold before year 5 and you were living there, then the entire gain is taxed! Many investors are falling into it because they rented it for 2 years, then lived in it for 2 more years, or a total of 4 years owned, then selling it thinking they can take the gain tax free since they attained the 2 year principal residence timeframe. However, since they did not own it the full 5 years as now required, it doesn’t qualify as a principal residence or a 1031 as it was personal use at the time of the sale. This is very confusing and a tax professional well versed in real estate taxation should be consulted when shuffling between personal and 1031 properties.

The changes cited above are the most significant that affect 1031 exchanges these past 2 years. Planning your exchange requires more care now to ascertain whether your investment and retirement objectives can be met. But the benefits of building wealth through 1031 exchanges are still bountiful and should not be dismissed because of the new hoops created by the IRS. They are merely saying if you’re going to do 1031 exchanges, better make sure you do them right and document what you are doing along the way.

###

Nace Cohen is the President and founder of 1031 Exchange Connection, Inc., an IRC §1031 exchange consultancy based in Naples, FL. He lectures extensively on IRC §1031, consults and structures tax deferred exchanges for Real Estate and Personal Property Exchanges, and provides replacement property alternatives . He is also a CPA and operates an accounting and tax practice specialized in real estate taxation and property management. Call toll-free 888-659-1031 for a free consultation, or visit their web site at www.1031-connection.com.

Bonita Beach Hot Dog Vendor Twittering?

This was high noon at Bonita Beach.  My Sunday mission was to stop in and check a listing in Bermuda Cays at Vanderbilt Lakes and then scope out a Bonita Beach foreclosure on Hickory Boulevard.  Yes, even beach front real estate occasionally gets foreclosed.

On my way back from looking at the foreclosure I took a spin through the Bonita Springs side of the public beach parking area.  I had LBD in the car and he just loves people watching and the smell of the beachy air.  When I rolled down the window we smelled grill and barbecue and hotdogs and relish.  We followed the great smells to this hot dog stand.

We just thought we’d let you know about the hot dog stand in case you get hungry at the beach or you want to pick up a hot dog on your way to look at real estate on Hickory Blvd.

Calendar of Events | Bonita Springs Riverside Park

Ladies and Gentlemen, Welcome the first guest post by Lori Nelson.

I know it’s been a long time since you have received an update about happenings in Downtown Bonita Springs, Florida.  So with season around the corner and a few events popping up, I wanted to take the opportunity to fill you in on what the City of Bonita Springs is working on in the Downtown area.

Downtown Bonita Springs, Florida

City Council has pledged it’s commitment to creating a true Downtown in Bonita Springs, voting to concentrate its efforts on the Downtown Bonita Springs Redevelopment and instructing staff to make this project a priority. 

• A new Land Development Code for the area is being prepared which includes incentives and relaxed building requirements.  
• The Local Planning Agency (LPA) and City Staff were instructed to proceed with a Comprehensive Plan Amendment that will allow the City block just east of Felts and Center Street from south of Terry Street to north of Dean street to be rezoned to allow light retail and office as well as residential.  This will create a buffer between the residential areas and the more intense uses that are proposed in the City Center west of Felts.

The City still needs your input.  Mark your calendar for Tuesday, September 1 at 9:00 a.m. - The LPA is meeting with the Zoning Board of Bonita Springs to discuss these proposals, and supporters of the redevelopment effort are encouraged to attend and show their support for the creation of a true Downtown in Bonita Springs.   Can’t make the meeting?  Email your comments to:  barbara.barnes-buchanan@cityofbonitasprings.org

Survey Monkey

What do you love about Bonita Springs?
What makes Bonita Springs, Florida unique?  What are the positive attributes of Bonita Springs?
How do we want people to see our community?  What do we value most as a community?

By participating in Bonita's Community Branding Initiative you can help the City and the Chamber of Commerce create a shared vision of our community including a set of key messages, imagery and outreach that consistently reinforces our strengths to our residents and our guests.

Please go to the link below and fill out the survey.  It’s fun and it only takes a minute.

http://www.surveymonkey.com/s.aspx?sm=l6Jzg1e9Zqx_2fP3KFDifsOQ_3d_3d

You can send your ideas and comments to the email address below...

bonitabranding@cityofbonitasprings.org

Mark Your Calendars!

All of the following events are held in Riverside Park in Bonita Springs, Florida.  Stay tuned for more details …

Patriot’s Day - Friday, September 11, 9:00 am - Program hosted by the Bonita Springs Fire Control and Rescue District, the Lee County Sheriff’s Office and the City of Bonita Springs.  Call 949-6262 for more information.
Riverfest – Friday and Saturday, October 23 & 24
Bonita Springs Concert Band – Sunday, October 25
Halloween in the Park – Saturday, October 31
Farmers Market – Every Wednesday beginning November 4
Fruit Tree Club Sale – Saturday, November 14
Taste of Bonita – Sunday , November 15
Bonita Springs Concert Band – Sunday November 22
Holiday in the Park – Tuesday evening, December 1
Bonita Springs Concert Band – Sunday, December 13
Movies in the Park – Saturday,  Jan 9th, Feb. 6th & March 6th

I hope everyone is having a great summer!

Lori Nelson

This is a funny that came in my email that I thought I’d share with you.  It looks like snails are the creature of the week on this blog.

Read also:  The Freshest Escargot in Bonita Springs

Estero Florida High School Football

9/04/09
Estero Wildcats at South Fort Myers (Fort Myers, FL)

9/11/09
Neumann (Naples, FL) at Estero Wildcats

9/18/09
Estero Wildcats at Lemon Bay (Englewood, FL)

9/25/09
Palmetto Ridge (Naples, FL) at Estero Wildcats

10/02/09
Estero Wildcats at North Fort Myers (North Fort Myers, FL)

10/09/09
Estero Wildcats at DeSoto County (Arcadia, FL) *

10/16/09
Fort Myers (Fort Myers, FL) at Estero Wildcats

10/23/09
Hardee (Wauchula, FL) * at Estero Wildcats

11/06/09
Estero Wildcats at Immokalee (Immokalee, FL) *

11/13/09
Cypress Lake (Fort Myers, FL) at Estero