At the present time, there has been a downside to the real estate market due to bad economic times. While this is tragic for many people, it has also allowed others to purchase homes at a low price. This is because short sales and foreclosures are available.
Short sales are an opportunity for homeowners to get out from under the burden of an over-priced house and high interest payments. With these sales, a bank or lender agrees to sell a home for less than is owed. The rationale is that it is better to get some money out of the property and avoid the long process and costs of foreclosure.
The difference between what a short sale home sells for and the amount owed, was once considered as taxable income by the government. However, due to the current housing market, the tax code was revised through 2012 to allow this to be excluded from income tax returns.
A number of investors are purchasing foreclosed and short sale homes, hoping for a future gain when property values rise. In the meantime, they are renting out many of these properties for more than the monthly payment, which allows them to make the mortgage payment and put something aside for possible maintenance. This is a wise decision for those who can afford to do so, as property has always showed a good return over time.
In purchasing a foreclosed or short sale home, it is extremely important to have an independent building inspection report before making a purchase. Extensive repairs, especially on 'as is' sales can be very expensive and can cost more than the amount one saves on the purchase price. In addition, checking out the neighborhood for any possible problems is also important.
The current interest rate, for home buyers, is at an all time low, many at 4%. In taking out a loan for purchasing a home it is paramount to get a 'fixed-rate' mortgage. Variable interest rates can change on a moment's notice and make a monthly payment extremely expensive.
The dream of owning a home can be found with most married couples and families who want to establish a location they can call their own. However, many purchased highly priced housing with high interest payments and, with the current economy, could no longer afford to make the payments. The result is apparent in the number of 'for sale' signs that are on almost every city street. The current real estate market, however, offers a rare opportunity to obtain a home at a price that is affordable and make that dream a reality.
Short sales are an opportunity for homeowners to get out from under the burden of an over-priced house and high interest payments. With these sales, a bank or lender agrees to sell a home for less than is owed. The rationale is that it is better to get some money out of the property and avoid the long process and costs of foreclosure.
The difference between what a short sale home sells for and the amount owed, was once considered as taxable income by the government. However, due to the current housing market, the tax code was revised through 2012 to allow this to be excluded from income tax returns.
A number of investors are purchasing foreclosed and short sale homes, hoping for a future gain when property values rise. In the meantime, they are renting out many of these properties for more than the monthly payment, which allows them to make the mortgage payment and put something aside for possible maintenance. This is a wise decision for those who can afford to do so, as property has always showed a good return over time.
In purchasing a foreclosed or short sale home, it is extremely important to have an independent building inspection report before making a purchase. Extensive repairs, especially on 'as is' sales can be very expensive and can cost more than the amount one saves on the purchase price. In addition, checking out the neighborhood for any possible problems is also important.
The current interest rate, for home buyers, is at an all time low, many at 4%. In taking out a loan for purchasing a home it is paramount to get a 'fixed-rate' mortgage. Variable interest rates can change on a moment's notice and make a monthly payment extremely expensive.
The dream of owning a home can be found with most married couples and families who want to establish a location they can call their own. However, many purchased highly priced housing with high interest payments and, with the current economy, could no longer afford to make the payments. The result is apparent in the number of 'for sale' signs that are on almost every city street. The current real estate market, however, offers a rare opportunity to obtain a home at a price that is affordable and make that dream a reality.
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