Well, 2010 is here, and with it comes some new guide lines for mortgage loans. Shockingly, this has been on the table for over 5 years with the feds. Some of the changes were the result of predatory lending practices we so fondly remember from 2006-2007.  You know the ones where buyers were treated to low low rates for 3 to 5 years on homes they really should not have purchased. The loans where the loan officer looked the husband in the eyes and said” Don’t you think you’ll be making much more money when it’s time to pay the much larger amount” ? It is good for us, those types of lending practices, are going to the wayside. Another issue with some of the loans came at the table when the closing took place. Sometimes the loan officer made a slight mistake in the calculations and the buyer had to pay more than expected to get the deal done. 2010′s programs or rules will help with the process. Here’s  how.

The loan officer will need the buyer’s full name, SS#, date of birth, 2 years address history, and a signed credit authorization form to pull their credit. They should not ask for a loan application or give any loan information at this time. They can however give the buyer a verbal estimate of what they could possibly purchase.  Once a property is found, they will ask for all of the above plus the loan application, property address, property value or sales price, and gross monthly income. Once all information is recieved, a  Good Faith Estimate (GFE) of all charges can be given to the buyer. The buyer will have 10 days to agree with the amounts.  In 2009, this information could be given just as an estimate and was likely to change. The difference now is the GFE can only change in the buyer’s favor.

So, you can still find a house, apply for the loan, and buy it with the help of a good real estate broker and loan officer.  It might take a little longer, but it’s worth it. Good home hunting. Hunting season is open until April 30, when the $8000 tax credit is scheduled to go away.

Wow, the holidays are over,  the new year has arrived, and it’s time to get back to living a normal  life.  Normal to some folks, and maybe including your own kids, is going home to an apartment or rental house. As a family, we always want to help when we can, especially when it concerns our children.  There is away you can help if ones able. The IRS says a person can “gift” up to $13,000 towards another person purchasing a home. There is no tax consequences when gifting as long as it is done correctly. Just think?-if both sides of the family”gift” the amount or any part of it, there would exist the possibility of a down payment for the home purchase for the kids.

The $8000 tax credit still applies when “gifts” are given for a first time home purchase. Mortgage rates are still low but the housing inventory is shrinking due to current sales trends. Wow, one of the greatest feelings I had as a parent, was helping my son purchase his first home. I wanted his young family to have their own house they could call home.

Real Estate is still one of the best investments to have. Even in a down market like we are in today. No one knows when the prices of homes will start to rise, but they will.  Those who have a chance to buy now will have the property increase in value in the future. Real estate, sort of has a 5 year roller coaster effect, much like any large business.  In 2006, the real state market was at it’s peak and then the decline started. We are at the midway point of this cycle. Currently we are still in a buyer’s market due to the amount of homes on the market. In my last article, RMLS showed a decline in the months of inventory  from 19.2 in January to 7.6 in September,  2009. In October it fell to 6.5.  Now is the time to consider owning a home.

A lot of folks don’t  know they have the ability to take from their 401K, without penalty, to purchase a first time primary residence. The IRS gives us permission to do it. The first time home buyer’s tax credits still apply. So, if you know of someone who has the means of paying a monthly mortgage, but they don’t have enough for a down payment, share this information with them. Thanks, they will appreciate it.

There are numerous folks out there who have the monthly means to afford a home mortgage. Sometimes the ability to save enough money for the down payment and what is called closing costs ,which could amount to over$14,000 for a $200,000 home, can be tough to accomplished. Do not let this hinder your quest for home ownership!  Here are two programs that will help with either, or both, down payment assistance and closing costs.

Rural Development Program: www.rurdev.usda.gov. This  programs provides up to 100%  financing  on loans originated by approved lenders. The program eliminates the need of a down payment and mortgage insurance on properties located in eligible rural areas. There is a household income limit in these areas.  Go to the above website to find out more information, or call a realtor to get you started. Home ownership could be within your reach.

C.H.A.P. Clackamas Home Buyer Assistance Program: www.co.clackamas.or.us. the CHAP program can loan up to $14,000 to help qualified first time home buyers pay down payments and closing costs. The loan must first qualify through an approved lender. Please go to the above website or call a realtor to find out if this could be right for you.

Both of these programs allow for the first time home buyer tax credit of $8000.00 So get started or tell someone that you  know that could possibly benefit from this information. Happy house hunting!

In business today, most of the attention is paid to the sales staff. They win bonuses and are awarded trips because, Nothing Happens Until Something Is Sold. Ignored are the Blue Collar workers transforming the sales into profits. The route worker who services your customer or the service person who interacts with your customer and makes them satisfied. These are also heroes of your company. Like linemen on a football team, they don’t score the points; they make it possible to score. ALL of your employees have the ability to create or diminish company profits. You also need to motivate and show appreciation to those in the trenches. Appreciation and acknowledgement will work wonders and it does not need to add to your company expenses.

In 1968 I was part of history. I was a lineman for a high school football team who only allowed 19 points to be scored against us ALL SEASON. No one scored on the ground. If you were going to score points you needed to pass the ball and hope you could complete the pass before we sacked your quarterback. We averaged eleven sacks per game.

Most of our games were low scoring because we did not have an accurate passing quarterback. We had one of the fastest running backs in the state, but he only weighed about 110 pounds, so he was down at the first hit.

Our Line Coach convinced us that we could only win if we, the linemen, could keep the other team from scoring. It wasn’t going to be the flashy running that brought us a victory. It would be our ability as linemen. The victory would come from the trenches.

Ken Bear Cole

A Second Look Business Consulting LLC

It is surprising how many people will put their money in just any bank. All banks are not created equal, and let’s just say that some have proven more solvent than others. Besides FDIC insurance, what other characteristics should you seek – and what questions should you consider?
How close is this bank? Is there a branch near where you live and close to where you work? How is the online banking setup? (Yes, you should value convenience, but it shouldn’t be the only factor in mind as you choose a bank.)
How cheap is it to bank there? You’ve heard of overdraft fees and ATM fees. But how about wire fees, notary fees, and fees on cashier’s checks and money orders? Returned-deposit fees? Stop-payment fees? Fees to check your balance? Fees to talk to a teller? (No kidding, some banks do charge for that.) Is it bad taste to ask a bank to detail its potential fees? No, it’s smart. Some banks offer you a free checking or savings account and a whole lot of potential charges besides. Some have plans that cover a whole range of services, plans that could save you some money.
What else can this bank do for me? Can the bank provide your business with credit card processing? Will your checking account give you any interest? What kind of CDs does the bank offer? How about mortgage and loan types? Could you send money overseas via this bank? Do they do any trust planning?
How friendly is this bank? When you walk into the bank, what’s the reception? Do people greet you and ask how they may help you? Or are you ignored for a prolonged period? What happens may hint at the level of service coming your way.
Ask to see a bank officer, if possible. Set down a list of what you want, and see how close your potential new bank comes to providing it. Don’t be afraid to make the bank work for your business – they are working hard than ever for it.
What can you do to make a banking relationship better for you? If you bring major amounts of cash to a bank, of course you’re going to be treated as a VIP. If you don’t, it may help you to establish a relationship or two. So often, we go to a bank and we look at the tellers – and even the loan officers and mortgage consultants – as mere functionaries instead of human beings.
If you have a lousy experience at the bank or you get dinged with some weird fee all of a sudden, ask someone why – maybe the customer service staff can address the matter and work out a solution. Make yourself known – a good way to do that is to bank when it isn’t “rush hour”. A friendly, recognizable customer who wants the best from his banking relationship can turn into a valued banking client.
Would it be better to bank online? How often do you need to go inside your bank? If you really don’t require much in the way of in-person services, maybe an online bank is a better option – after all, why should you pay to support your bank’s branches if you never set foot in them?
Thinking small may help. People were leery of small banks in this last economic downturn, but the customer service can be considerably better at such institutions. When a community bank is bought by a bigger one, bigger does not necessarily mean better in terms of attention.
Dominic Sitowski is a Representative with Crown Capital Securities and may be reached at www.domsitowski.com or dsitowski@crownmail.net.

These are the views of Peter Montoya Inc., not the named Representative nor Broker/Dealer, and should not be construed as investment advice. Neither the named Representative nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information.

We all know the economy has something to do with it. The school district has made large cuts in their budget and spending, keeping in mind the importance of our youth’s education. The education process can not fall, just on the shoulders of our educators. We ,as a community, need to rally to their support.

        “The main hope of a nation lies in the proper education of it’s youth”- Erasmus

The North Clackamas Education Foundation-NCEF, of which I am a board member, is striving to help offset the down turn in the state’s allocated funds to the Clackamas school district.  The Foundation , through  donations, grants, and civic events, gives student scholarships and teacher grants to help promote the education process. 

Go to: www.nc-foundation.org to get more information on this great foundation.

As a realtor in the community, I know that a strong school system benefits us all. New families move into areas with a great school district. The more new families, the more business comes to Clackamas County.  As individuals or groups, we can help grow a vibrant community. 

In the movie Forest Gump, Tom Hanks tells us that, “Life is like a box of chocolates. You never know what you got until you bite into it. ”  Well, for almost 250,000 Oregonians in the Portland metropolitan area, their piece has turned sour and discouraging, because they are without a job. For many, they have also exhausted their unemployment benefits and their savings account is fading away. If things do not change soon, their new home may be the family tent they enjoyed during vacations of the past. Only this time it could be much longer then a week or two.

Some have abandoned the thought of looking for a job. They have decided to start a business of their own, relying on their talents gained buy previous employment. It has been estimated that nearly 70,000 new businesses will be formed in Oregon in 2010. Most of these companies will be in the Portland area and have no employees. These will be composed of the unemployed who are trying to survive. They may arrive in a BMW wearing a $500 suit, but they could also be receiving food stamps and living with relatives. I commend these warriors fighting against their personal poverty. I say fight on, because some of you will discover powerful personal qualities of leadership and courage. These times will prove that you can survive and prosper once more.

Sad to say, not all will become successful, but having a plan of action will greatly improve your odds. As I meet with new businesses, I always ask who is their targeted customer. Too often the response is, “everyone.” That lack of focus will cause you to chase customers who do not have the ability to purchase or interest in your product. You need to ask yourself a few questions prior to mastering the world.

• Who needs my product or service and why?

• Who is already servicing that market?

• What do I have that is different?

• Why should they buy from me?

Answer these questions in as much detail as possible. This is by no means a complete list of questions, which need answering to become successful. It is only a start.

If you have started a business, I would like to hear your story and progress. Your struggles and success can encourage others to continue moving forward.

E-mail http://ken@asecondlookbizconsulting.com

I wish you all the best!

Ken Bear Cole

A Second Look Business Consulting LLC

EXTENDED HOMEBUYER CREDITS & JOBLESS BENEFITS

New federal actions aid the real estate sector and the unemployed.

provided by Dominic Sitowski, CEP, LUTCF
After unanimous passage in the Senate and a 403-12 passage in the House of Representatives, President Obama signed H.R. 3548 into law on November 6. The bill extends and expands a key tax credit for homebuyers while also offering more help for those out of work.1,2
The $8,000 credit for “first-time” homebuyers continues. This tax break is now extended until May 1, 2010. If you have never owned a home or haven’t owned a home in the previous three years, you are considered a “first-time” buyer and therefore eligible for the credit (it is a credit of up to $8,000, by the way). You must sign your purchase agreement before May 1, 2010 and close the transaction before July 1, 2010 to qualify for this tax break.3
The $6,500 tax break for move-up buyers. Okay, maybe you aren’t a “first-time” buyer. You may still qualify for this new real estate credit. Have you lived in your current home for more than five consecutive years? You may be eligible for a credit of up to $6,500 if you move out of that home and buy another. Again, you have to sign your purchase agreement before May 1 and close before July 1 to get the tax break.3
Worth noting: BusinessWeek.com contacted Sen. Chris Dodd’s office (the Connecticut lawmaker chairs the Senate Banking Committee) and received word that move-up buyers can qualify for this $6,500 credit even if they have signed a purchase contract prior to November 6, provided the purchase closes before July 1.4
Does everyone qualify for these credits? Not quite. They phase out for individuals with adjusted gross incomes of more than $125,000 a year and couples with AGI of more than $225,000 a year. (The old phase-outs respectively kicked in at $75,000 and $150,000. These higher phase-outs mean that the credit can now help an additional segment of the housing market.)5
You can’t buy a vacation home and claim one of these credits – they only apply to principal residences. In fact, the home you buy has to have a sale price of $800,000 or lower.5
What will this do for the economy? “Every economist will tell you we have to steady the housing market before the economy will turn around,” Sen. Dodd expressed on November 5. “We can’t afford to let this tax credit expire now.” Respected Moodys.com economist Mark Zandi agrees, saying that “from a macroeconomic perspective, nothing is more important than stabilizing housing values.” Zandi thinks that the $8,000 credit has led to 400,000 additional home sales in 2009. On the other hand, Dean Baker, the co-director of the Center for Economic and Policy and Research, questions why the extension is necessary: “For the most part, you’re just giving people money for something they would have done otherwise.” The Joint Committee on Taxation estimates that extending these credits into 2010 will cost $10.8 billion across the next decade.5,6
An extension of unemployment benefits. H.R. 3548 – sponsored by Rep. James McDermott (D-WA) – additionally extends state jobless benefits by up to 20 weeks. This will happen as a result of another extension – an extension of the federal unemployment tax on employers until June 30, 2011.5
If you are one of nearly two million Americans whose jobless benefits are set to run out at the end of 2009, this extension will help you. Your benefits will last at least another 14 weeks into the new year – in fact, they will last for another 20 weeks if you live in a state where the unemployment rate exceeds 8.5%. Have your unemployment checks already stopped? You may reapply for benefits.5
A chance for companies to convert losses into cash. What? Really? Yes. There is one provision of the new legislation that many have overlooked: it widens the window of time on the net-operating loss carryback. It lets all businesses apply losses from either 2009 or 2008 to any five years prior to 2008. So business owners, by virtue of the new legislation, have the potential for an IRS refund on the taxes they paid for the five years prior to 2008. There are two asterisks here. One, refunds for taxes in the fifth year of the carry back shrink by 50%. Two, any business that received TARP funds can’t take advantage of this tax break.7

Dominic Sitowski is a Representative with Crown Capital Securities, LP and may be reached at www.domsitowski.com, 503-496-3641 or dsitowski@crownmail.net.

These are the views of Peter Montoya Inc., not the named Representative nor Broker/Dealer, and should not be construed as investment advice. Neither the named Representative nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information.

Citations.
1 google.com/hostednews/ap/article/ALeqM5hZg_pvAKDYQV-RYmrmcBrJTaJ5CAD9BQ71981 [11/6/09]
2 latimes.com/business/la-fi-tax-credit6-2009nov06,0,2604220.story [11/6/09]
3 boston.com/business/articles/2009/11/06/first_time_home_buyer_credit_jobless_benefits_both_extended/ [11/6/09]
4 businessweek.com/the_thread/hotproperty/archives/2009/11/who_qualifies_f.html [11/6/09]
5 money.cnn.com/2009/11/05/news/economy/Extending_unemployment_benefits/index.htm?postversion=2009110612 [11/6/09]
6 latimes.com/business/la-fi-tax-credit5-2009nov05,0,1817786.story [11/5/09]
7 money.cnn.com/2009/11/05/news/economy/tax_breaks_for_business/index.htm?postversion=2009110611 [11/5/09]

Did you create a marketing strategy to justify your vision or focus your effort?

More often than not, when helping a small business develop their website, I discover they have NO marketing strategy.  Those who have written a strategy, more often than not, did so to justify their vision.

If you’ve never heard the phrase, then please allow me to introduce you to a new concept.  Niches bring riches!

If have not already created a Marketing Strategy, start today.  If you have created a Strategy that identifies EVERYBODY as your target customer, start your first rewrite today.

Your marketing strategy is a road map to using limited resources to succeed in your business.  Identifying fewer, more focused target customers will improve your conversion percentage.  Do some soul searching, and start with who you DON’T want as a customer.  Starting with who you don’t want will help you focus on the personality traits of those you do want as customers.

Why narrow your customer focus?  Because you do not have enough time in the typical work year to meet with everyone, you must prioritize your prospects by conversion opportunity.  Those with whom you have a natural personality clash with should be eliminated from your marketing strategy.  At some point in the transaction, your personality clash will become apparent and the business relationship will halt.

Develop a clear personality profile for your preferred client.  Then identify the things this personality type does for fun.  Find ways to market to those people where they are having fun.  Avoid the direct sales presentation and authentically injected your own personality into the presentation.  Let the laws of attraction bring your new customer to you and you’ll be impressed with how easy closing deals becomes.