How do I get into my first home?

Powerful tips on what needs to be done to get into your own home.

It is truly unfortunate, that these days, too many people don’t even believe in home ownership. For 95% of families, it’s the most sure way toward financial stability and a comfortable retirement.

Luckily, you’re NOT one of those people.  You know that a sure way to start building wealth (or at least stop paying someone else’s mortgage) is to buy a home. You’re now thinking about your future, and your family’s future (or future family’s future).  But how do you get started?

First, it’s going to take a plan and commitment.  You’ve probably heard this before, yet I’ll reiterate it. A written set of goals, to purchase your home, is your surefire way to make it happen sooner, rather than later. Talk to a lender, today (I have a couple who are wonderful with first time buyers). Even if you’re nowhere close to being able to buy, a lender can tell you what you’ll qualify for, when you ARE ready…How much cash you need for a down payment and closing costs, and how much your monthly payment will be.  When you have your plan complete, write the amount you need to save, every day/week/month on a sticky note and post it where you’ll see it every day.

Now comes the really tough part…How do I come up with that money every day/week/month?  CUT BACK ON ALL FRIVOLOUS SPENDING!  I am amazed that people who are still living at home or renting, think they have to drink $5 coffees, eat out 3 or more times a week, have the newest clothes/shoes/phones/computers and spend the rest of their money on a fancy car. Changing your lifestyle now, even if just enough to save a down payment, will reward you for the rest of your life (way longer than those material fads).

Other possible options (to get into your own home even quicker); Lower your current rent, by downsizing or sharing…Get a 2nd job (even $200/week adds up fast)…Sell your car (get something cheaper, take the bus or carpool).  Keep reminding yourself why you’re making these sacrifices, and how much happier you’re going to be, when in control of your own financial future.  Then make sure you put every penny of that $$$ into your “Down Payment Savings Account”.

Here is a Great interview on CNN about the subject; 





Lastly, Get financial help. You may have parents or other relatives who are willing to help you get started. Yet there are also many public down payment and first time buyer assistance programs. We can help you find those as well.

For more information on many aspects of purchasing and owning a home, please go to; 

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7 Important Tax Law Changes in 2016


As always, we publish this informations to help you. Yet we are NOT tax advisors. Please consult your tax professional for advice.

1. Three Extra Days – The tax filing deadline is delayed due to April 15 falling on a weekend and Emancipation day in Washington, DC. Returns may be filed until April 18, 2017. If you extend six months, the return will be due October 16, 2017.

2. Refund Delays – If you file early and claim the Earned Income Tax Credit (EITC) or Added Child Tax Credit (ACTC), the IRS must hold your refund until February 15. The first refunds for filers who claim these credits is expected to be the week of February 27.

3. Renewing Individual Taxpayer Identification Numbers (ITINs) – An ITIN is used by some taxpayers in place of a Social Security number. If it has not been used in three years or the middle digits are 78 or 79, the ITIN will expire. It may take up to 11 weeks to renew the ITIN. Taxpayers may contact the IRS Taxpayer Assistance Center (TAC) to obtain help in renewing their ITIN.

4. Olympic Medals – For 2016 Olympic and Paralympic winners with incomes of $1 million or less, their gold, silver or bronze medals and United States Olympic Committee (USOC) cash awards are not taxable.

5. ABLE Accounts – It is now possible to create a special account for persons who become disabled before age 26. Donors are permitted to make annual gifts with the current exclusion amount of $14,000 per year. While the gift does not qualify for an income tax deduction, the account may grow and distributions for a disabled person’s qualified expenses are tax-free.

6. Standard Mileage Rates – The IRS publishes mileage rates each year for business use, medical and moving travel and charitable travel. For 2016, the business use qualifies for $0.54 per mile, medical and moving expenses are $0.19 per mile and charitable travel is $0.14 per mile.

7. IRA Rollover Self-Certification – The normal IRA rollover limit is 60 days. Self-certification may enable you to have an extended period of time for an IRA rollover. In order to self-certify, you must fall into one of 11 specific categories. These include “a distribution check that was misplaced and never cashed, the taxpayer’s home was severely damaged, a family member died, the taxpayer or a family member was seriously ill, the taxpayer was incarcerated or restrictions were imposed by a foreign country.”

The IRS asks IRA owners to use a “trustee to trustee” transfer instead of the 60 day rollover. A trustee to trustee transfer avoids the risk of exceeding the 60 day limit.

In FS-2017-1 the IRS published a summary of seven tax changes.

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Something Good out of Sacramento

We don’t hear this very often and you probably thought you’d never hear me say it. Yet Governor Brown did approve some legislation to protect families from suffering further loses, after a loved one has passed. CA Legislature

Unfortunately, too many people pass away, without any kind of Will or agreement for the disposition of their property(s). Some pass unexpectedly way too soon. In these cases, the state and attorneys get a large chunk of the estate’s value, while trying to figure out, who should get it.

There is now a simple new form, that can be filed at anytime (see limitations below), to help curb all those unnecessary expenses ($1500-$2000 avg. trust costs) and keep the funds with the family (or other party designated), where they belong. This is thanks to California State Assembly Bill 139, passed September 21, 2015, whose provisions have been available in Hawaii and a few other states for sometime.

Beginning January 1, 2016, Assembly Bill 139 (also known as the Poor Man’s Trust), created a non-probate method for conveying interest in real property upon death. This is accomplished through a revocable transfer upon death deed (RTDD). If an RTDD has been filed, on 1-4 units, or agricultural land of less than 40 acres, from now through 1/1/2021, the deed automatically transfers to the listed recipient, and can only be revoked by a recorded document.

There are exceptions and certain provisions, for instance; if the property is owned by 2 people & 1 dies, the surviving person must file a new RTDD… If owned by Tenants in Common, it only affects the decedents portion of the property and if owned by Joint Tenancy, it is voidable. It does not require owner or lender to file a quit claim deed and it terminates upon the sale of the property (if sold to someone other than beneficiary). It also doesn’t not affect the current ownership in any way. The RTDD Must be recorded within 60 days of execution.

For more information on protecting your family, your assets, or to help explain this to loved ones, please call Scott Stephens (714) 801-6230…Before it’s too late.

For a full copy of the legislation;


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6 Years of Growth could spell Trouble

Real estate and other markets have been on s fantastic run, the last 6 years. Most markets have made a full recovery from the previous down-turns. Yet, as we’ve all heard the old saying “too much of a good thing…”                 Orange

Jonathan Lasner, took and indepth look at where we’ve come from, we are currently, and where we might be headed, in his “Big Orange Index”, in his Orange County Register article, on January 24, 2016. He noted that our 2016 economy has started strong, but that this steak “is creating challenges…beneath the surface.”  His Big Orange Index, which is a compilation of 3 dozen benchmarks, shows a new record high as 2015 ended. Yet that 4th quarter report showed the second smallest increase since the upswing began in 2010.

Jonathan noted the following areas where there appears to be a new lack of confidence; CEOs (last 3 quarters), shoppers, property owners. Another economist (unknown) noted that 41% of Americans are also nervous about rising interest rates, this year.

Governor Jerry Brown, in his infenant wisdom, has declared a state of emergency on housing rentals. This could limit rent increases to 10% in the very near future. Real estate investor purchases have been helping to keep prices appreciating. While this may not create a huge sell of, it could slow appreciation significantly. Lasner also noted that do to the limited supply of properties (for both owner occupied & non-owner occupied), which has driven prices to record levels and stretchered buyers’ abilities, has lead to falling Property Owner indexes.

The Asian economy is also something we must watch closely. As you can read in my previous blogs, Asians make up a HUGE portion of the buyers in many US areas, including LA/Orange County. Earlier this month China had to close it’s stock markets 30 minutes after opening, due to a huge sell off, which prompted even more selling and then flattening. This prompted their government to dump $18 Billion into their markets.  If this massive sector of buyers were to pull out of US markets, appreciations would slow, and if they started selling many of their holding, in any or all of their areas of influence (residential, retail & commercial), this could have a devastating effect on home values.

Lasner also mentioned that this upswing has run for one year longer than in the last decade. He suggested that if the current “…skittishness remains so widespread…how will Orange County react”, and questions whether it will “…turn into stagnation or worse?”

Don’t get me wrong, I’m NOT predicting a doomsday scenario. Yet, we have to ask ourselves, How much riskier do does the real estate market have to get, before we decide, its time to move?

Isn’t it Time to Hire the Right Agent? My team and I keep our fingers on the pulse of the market, by looking at over 200 homes a month. If you want a Specialist, someone who KNOWS this Market, working for you, Please call us (714) 801-6230.

For more information, search for homes, check demographics and more;

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Mortgage Closings are now Taking Longer

Some of you may have already heard about the new consumer protections called “TRID”, which stands for this mouth-full; “TILA (for Truth In Lending Act), RESPA (for Real Estate Settlement Procedures Act), Integrated, Disclosures. Yup, congress, through the Consumer Financial Protection Bureau, has once again taken consumer concerns (or acted on their own to look good), and came up with new laws to turn your world upside down.

Effective today, Big changes take effect in all residential real estate transactions involving mortgages (purchase and refinances).  Commercial, cash and other transactions types are not affected (evidently they are smarter & can protect themselves). This could extend the current 30 day escrow, to 60 days (although, after everyone gets grasp on all the new disclosures & timelines, could settle in around 45 days). These new government mandates, although designed to protect buyers/borrowers, will effect Sellers & almost every other entity in real estate transactions from now on.

The current “Good Faith Estimate” will be replaced by a “Loan Estimate”, which will be received within 3 days of applying for a loan. The “Closing Disclosure” must be received by the borrower 3 business days before the closing. If this disclosure is mailed, couriered or emailed, they must add another 3 business days. This is a huge change, because today, some necessary information is still being gathered (changing signing documents) 1-2 days before closings. To accomplish these new mandates buyers & agents will need to get lenders EVERYTHING they need 10 days before the closing…Rush or Last-Minute Closings will No Longer be Possible. Realistically, buyers & sellers may need to add 3-4 weeks to closings, to accomplish everything needed.woman pulling hair

Trying to close by the end of the month (to save on interest)? You must get all documents to your lender by early to mid-month, especially if you want to ask questions.  In February that means immediately after the Super Bowl.

Real Estate Purchase contracts have also been changed. So make sure you agents knows them, and knows how to still get your transaction closed in a timely matter.  Scott Stephens is a Real Estate Trainer, keeping not only himself, but also his fellow agents up-to-date on all new changes. Additionally, he uses a lender, “United American Mortgage Company” who GUARANTEES they can still close purchases in 30 days*. Whether you are a Buyer or Seller you’ll want to Call Scott, Keller Williams Realty, for advise (714) 801-6230 or Phil Andrews, of UAMC (714) 287-6148 (sellers can require buyers to apply with Phil, although they can’t require that they use him, providing confidence they can close on time). No Hablo Ingles…Jessica McClure (714) 713-0172.

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Missed it by that much

missed by thatZillow, Trulia and other online real estate systems are great entertainment. For anyone who is just starting the process of purchasing or selling a home, and like to gather as much information as possible, they provide a loose idea, of home values and of possible homes for sale. Yet I have found, in speaking with my clients, as well as some of my colleagues, they miss the mark Big Time, there are MANY mistakes, and a lot of misinformation.

Everyone of my clients, who have used an online search system prior to contacting me to help them find the perfect home, stated that Many of the homes were already SOLD, there is a lot of misrepresentation of amenities, and some are even made up (they don’t exist anywhere in the system, and no one has any record of them being for sale). Here’s what one of them posted on my website (; “Your website has been a great help in trying to find the right home. The search options available are great and the feature to save searches is very helpful and time saving. One big advantage over websites like Zillow and Trulia is that the listings are always up to date. Prior to my knowledge of your website, I found many properties on Zillow and Trulia that weren’t available anymore or had errors in listing. This lead to false perceptions and were a waste of time. Thank you for showing me your website. I really appreciate it.”  Ritesh Meta 9/30/13

When it comes to putting a value on your home, the results are likely just as far off. Sites have been as much as $100,000 in difference, on the same home. Zestimates (by Zillow) rank their accuracy, for Los Angeles & Orange County, 4 stars (their highest ranking) as of the date of this article.   Missed by that much

Here’s what they published for the OC (LA stats are within 2% pints in each level); “…our estimates are with __% of the sold price, __% of the time. Within 5% – 40% of the time, within 10% – 67% of the time and within 20% – 85% of the time.” Note; All rounded to nearest whole.

So, if we use the current OC median price, of $680,000, they may have only been off by $34,000, 60% of the time. You may be ok to eat that, if you don’t want to talk to a professional. Yet it could be a $68,000 loss in 33% of the cases, which would make it a little more difficult to swallow. It gets better…They would only be off 15% of the time, by $136,000. Is that bad?

If I were one in 7 people, who could stand to lose $136,000, I would CERTAINLY ask a professional.

Your local Realtor (if they have over 20 years experience, like I do) can Save you money, by finding the perfect house, in the quickest time and negotiating the best offer, and/or Make you the most Money, through correct pricing, marketing and negotiating your current home’s sale. All while making sure everyone is protected through the most up-to-date disclosures.

Go ahead and satisfy your curiosity and be entertained with an online site, but use a Realtor, when you get serious about buying, selling or investing in real estate.  And don’t be surprised if they come up with some very different information.

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Surprise…I’m not going to tell you “It’s Time to Sell”

I’m going to let you make that decision, based on the facts of our current real estate market.

The trend – Median sales prices in California have been appreciating for going on 5 years now. More the most part, all loses have been recouped from the 2007 debacle. In 2012 the median rose about 12 percent, in 2013 it was 27 percent, last year we saw about a 10 percent appreciation and this year we’re at about 5. What direction do you think it will take from here?

Supply – The 2015 spring market saw an average appreciation, which was surprising, because the inventory was very low. The supply this spring was only about 1.5 months (meaning if nothing changed and no more came on the market that inventory would be gone). Currently we have about nearly a 2.5 month supply.  Listing inventory has nearly doubled. This isn’t all do to fewer buyers (because the spring market is over), there are also many more sellers listing their homes, and buyers are more cautious, taking their time to find the right home. More sellers believe we are near a peak again. The OC Register reported 8/6/2015, that consumer confidence in long-term appreciation had dropped by 10%.

Demand- The obvious fact that I mentioned above “the spring market is over”, is only part of the demand issue.  Here in Southern California housing affordability has dropped to one of its lowest points in history, 21%. Plus, the age of our average home buyer has moved up again, from 38 two years ago to 48 today. Condos are the new affordability frontier again. Existing condos sale in The O.C. are up 17.9% from a year ago, compared to the 5% home sales.

The proverbial Straw – Chinese government devaluing the Yuan. This monetary imbalance may affect many aspects of our life, most of all real estate values. You see 19% of Southern California homes sales have been to Chinese buyers. This may change drastically.

Where do you think the real estate market is going?

Check your neighborhood stats against those of any other area across the country;

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