Mortgage Basics: First Things First!

It is a rare occurence if I am not conducting a public open house on Sundays, be it for my listings or a colleague’s. I have to say that I am always amazed by how many buyers are out there looking for a home and have not yet gone through the process of being pre-approved by a lender. This goes for first time buyers, as well as those upgrading to a larger home. In New Jersey, it has become a best practice for Realtors to submit an offer on a home with a pre-approval attached. Without an official pre-approval from a lender, offers are simply not taken seriously. Furthermore, if you find the house of your dreams and happen to be involved in a multiple-bids situation, you will be hurting your chances of being in the running.

So, my advice is when you decide to start looking for a new home, make speaking to lender the first thing on your Home Buying To Do List. I encourage all my clients to speak to at least three lenders to compare rates.  Having the necessary information ready BEFORE you make the call will make the mortgage application process easier and faster. Below you will find a preliminary check list of paperwork you should start looking for:

General

• Social Security numbers
• Employment verifications
• Two most recent paycheck stubs
• Tax returns for the last two years
• Three most recent bank statements
• Divorce papers
• Green cards for resident aliens

Assets

• Saving accounts (balances, account numbers, and institutions)
• Credit union (balances, account numbers, and institutions)
• Mutual funds (balances, account numbers, and institutions)
• IRAs or 401(k)s (balances, account numbers, and institutions)
• Equity in current home
• Cash flows from rental properties
• Pensions or annuities
• Alimony
• Life insurance—the face amount and cash value

Debts

• Mortgage and home equity loans
• Monthly bills
• Credit card balances
• Student loans
• Car loans
• Alimony and child support payments

I'm happy to provide names of lenders that have worked with my clients, just email me for the list at caroline.gosselin@cbmoves.com.

Sellers: Looking for Ways to Set Your Home Apart Once the Tax Credit Ends?

If you are looking to sell your home this spring or summer in Maplewood, South Orange, Short Hills / Millburn, Springfield, Livingston, Summit or West Orange, New Jersey - you may want to read on. I'm highlighting this program because I truly believe it will give you an edge in setting your home part and increasing buyer traffic to your property. 

Coldwell Banker has just announced the launch of a new "Buyer Bonus Program", a promotion intended to build on the momentum of the Federal Home Buyer Tax Credit expiring this Friday (April 30).
 

On May 1, immediately following the expiration of the government initiative, home sellers participating in the Coldwell Banker Buyer Bonus Program will be offering a credit of 3 percent (up to $8,000), of their home's purchase price to buyers who sign a contract before July 31, 2010. As an added plus, unlike the Federal Tax Credit, there is no deadline for a closing date and no income or price point limitations.  Jim Gillespie, President and CEO for Coldwell Banker has stated, “we are trying to encourage buyers who haven't found a home yet to continue looking… the Buyer Bonus Program will keep our market moving in the right direction.”

Working with buyers, I've come to find that they ideally want to put all their cash into a sizeable downpayment (to make their offer stronger in multiple bid situations, to get a better interest rate, etc..). This doesn't leave much to pay for the closing costs which can add up and easily cost $8,000 to $10,000, depending on the price point of the home. The Federal Tax Credit was enticing in that it helped cover those costs. The new Buyer Bonus program we are rolling out is just a creative way of telling buyers to keep looking because there is still a possibility of getting help covering these costs. And for those buyers who aren't as cash strapped, it might make your home appealing to them if they can equate that $8000 with paying for a bathroom renovation, landscaping, waterproofing the basement, installing new windows. Catch my drift?

Participating homes will be identified by Buyer Bonus Sales Event yard sign riders and tagged as a Buyer Bonus home online at www.coldwellbanker.com and on the Garden State Multiple Listing Service (GSMLS), on my websites (www.TalkToCaroline.com and www.CarolineGosselinHomes.com). Furthermore, all sellers who take part in the Program will receive broad marketing support from Coldwell Banker, including:

• National television commercials beginning May 1, 2010
• Extensive online advertising
• Promotion on www.coldwellbankermoves.com
• Updates on the event on Coldwell Banker's Facebook and Twitter pages and the Coldwell Banker blog
• A You Tube video highlighting the practical value of $8,000 will also be posted to my very own You Tube channel, Prominent Homes.

So if you are thinking of selling your home between now and July in Maplewood, South Orange, West Orange, Springfield, Livingston or Summit, New Jersey and want to hear more about the program - call me, I’d be happy to discuss how my personalized marketing program and this Buyer Bonus can get your home sold!

Best,

Caroline

April 1 Deadline Looming... Thinking of Appealing Your Property Taxes?

I hear this question asked all the time by clients or on e-loops and various local discussion forums. With home prices below their highs in 2005/2006, homeowners are starting to think twice before shelling out those big bucks for property taxes based on outdated assessments.

If your home's value has come down, you should, as many local residents have done and done successfully, be able to appeal its assessed value. Local governments generally don't reassess homes every year, which means the values they use to calculate property taxes may be outdated or just completely off for some reason or another.

The appeal process varies depending on the township, but here are some general guidelines on the steps to take:

STEP 1: TRACK DOWN THE PAPERWORK
Property taxes are assessed on a local level. Search your township’s web site (Maplewood, South Orange, Summit, Springfield, West Orange, Livingston, Millburn / Short Hills) for the forms needed to file an appeal. There will be a small filing fee. You will need your Lot and Block number – these should be listed on your mortgage documents or property tax bill. Tax appeals must be filed annually on or before April 1st or within 45 days of the bulk mailing of the Assessment Notices; or May 1st where a municipal-wide revaluation or municipal-wide reassessment has been implemented. Once filed, a hearing before the County Tax Board is scheduled. Individuals can represent themselves.

STEP 2: UNDERSTAND THE PROCESS
There are two important technicalities to understand. The first is understanding that local governments allow themselves a 15% margin of error. Therefore, if you feel you are overpaying by 3% - it might not be worth the head ache because your appeal will likely be rejected.

The second is that you are not appealing your property taxes, you are appealing your home's assessed value. This is the basis for your property tax, and is not usually the same as your home's market value. Some local governments assess homes way above or way below their market value. For example, if the assessment rate is 50 percent, the assessed value of a $1 million home would be $500,000. Assessment rates can change from year to year, depending on the towns budget needs for that year. It's also important to know the date the assessments are based on. In New Jersey, homes are assessed on Oct. 1 of the previous tax year. So if you're requesting a new assessment for 2010, you need to research home prices from around Oct. 1, 2009.

STEP 3: COLLECT YOUR EVIDENCE
The bulk of your work will be collecting the evidence to make your case. You can search free websites such as ColdwellBankermoves.com, the Garden State Multiple Listing Service, or Zillow.com. Be sure to use the actual sales price of a particularly property, as opposed to the list price – this will make your argument stronger. The easiest way to get this information is to ask your realtor – after all she probably knows your home better than you do and will be able to navigate these sites easily to find comparable homes.

You should collect data on about three to five properties, making sure they are similar in size, style, age, lot size and upgrades. Be sure to point out why the houses are comparable to yours, and note any significant differences that could affect values, such as proximity to a busy street, nearby highway, electrical tower, or a sloped yard. Also point out if your home is close to any foreclosed or short sale properties, both of which can affect property value. It's important to show that you did your research and to organize it well, but you don’t have to write a novel!

Given all the information online now, most people should be able to put together an appeal on their own. But if you feel as though you just don’t’ have the time to take on another task on your to do list, you can hire a local attorney to process it for you. You may even want to take it a step further and pay for a new appraisal of your home. Be sure the appraiser you hire is licensed and from your area. They need to understand the local market to be able to appraise your home correctly.

STEP 4: FOLLOW-UP ON YOUR APPEAL
Check on the status of your appeal a few weeks after you file. But don't panic if you don't hear back right away – it could take anywhere from two to six months. Local assessor offices are often swamped with appeals and may take months to get back to you.

If your appeal is denied and you are dissatisfied with the judgement of the tax board, you have 45 days from the date of your judgement was mailed to file a further appeal with the tax court.

In the meantime, continue paying your property tax bills!

Please note that this is simply a basic outline to help you better understand the process. For more comprehensive information, you should visit the State of New Jersey’s Division of Taxation website or the New Jersey Association of County Tax Boards.


Good luck and please keep me posted on your success... I always like to hear a tax appeal story with a happy ending!

Best,
Caroline

The Revaluation of Property in Maplewood, New Jersey

Property taxes are a sore subject for Maplewood residents. I‘ve been hearing a lot of buzz recently about the scheduled revaluation for the town and decided to attended the Hilton Neighborhood Association meeting at the DeHart Community Center last Thursday to hear about the Hows & Whys of the Revaluation of Real Property in Maplewood, New Jersey in 2010.

The last revaluation process in 2000 was highly criticized as lacking transparency. This time around, the township interviewed 3 firms and hired Appraisal Systems Inc... Ernest Del Guercio, the firm’s CEO, vowed residents that the process would be completely fair and transparent. He stated that moving forward, all information related to the revaluation will be available on the company's website www.ASINJ.com. This will be an ongoing process for much of 2010 and new assessments will take effect in the 2011 tax year.

Why a Revaluation?

Revaluation are ordered by the County Board of Taxation. According to the “Handbook for New Jersey Assessors” they are accomplished by the mass appraisal of all real property in the taxing district by an outside professional appraisal or valuation firm.

The objective of a revaluation is to bring all properties to 100% of their true market value. Property values change at different rates for various locations and property types. A revaluation ensures fairness and equity in the collection of revenue for Municipal purposes. This balances the Municipality's real property tax burden among its taxpayers.

It is important to understand that revaluations do not necessarily indicate whether the tax on your property will increase or decrease. The municipality only collects the amount of tax dollars that the four units of local government (local school, regional school, county government and municipal government) determine is necessary to operate.

The following is a summation of the seven-point process presented by Mr. Del Guercio and his team:

Inspect: Within approximately 10 days, Maplewood residents will receive a letter outlining the process of the revaluation along with an informational brochure. Inspections will likely begin on the side of Maplewood bordering Irvington, and move westward. As appraisers make headway into new parts of town, reminder postcards will be sent out.

An inspector will make a first visit, measuring the exterior of the home. An interior inspection will then be done. Residents will have the opportunity to reschedule for a time when they will be home. Each inspector will have an official ID with photo and if you are uncertain, you can call the Maplewood Police Department to have them check the license plates which will be registered with the department.

It is important to let the inspectors know anything about the house or neighborhood that is not obvious. For example, if the inspector were to come at 11 am, he would not be able to see that a street might be a cross-through street which has a large amount of traffic in the morning or afternoon due to a school being nearby. Any “outside influences” that would impact the value of your home should be conveyed to the inspector. Other examples include electrical towers, steep topography, nearby railroad, highway, or gas station.

The condition, size and style of the house will also be considered. Some common architecture styles identified are: Cape Cod, Dutch Colonial, Ranch, Tudor, Victorian, Cotemporary, Bungalow, Cottage, Manor, Duplex.

Analyze: Appraisal Systems will be analyzing the characteristics of each Maplewood neighborhood and assessing homogenous zones to delineate neighborhood boundaries. All of the maps will be available on their website.

Market Analysis & Review: This is a general review of information realized from the inspections and the market sales analysis. Mr. Del Guercio said that Appraisal Systems is committed to "100% fair market value." Unlike appraisals done for mortgages, he said the Appraisal Systems is bound by a uniform standard that produces equitable values.

Notification of Value: By fall or early winter 2010, a letter will be sent to property owners with the assessed value of their property. The letter will also contain instructions for setting up a meeting to review the assessment with one of the company’s representatives.

Informal Hearings: One-on-one meetings to discuss or challenge your proposed assessment can be scheduled with representatives of Appraisal Systems and will take place at a local municipal meeting.

Submit: Final values will then be sent to the Town and County. All information (forms, photographs, maps, correspondence, etc…) is given to the town. Residents are then sent an official notification of final value from the municipality via postcard.

Defend: If you still believe errors have been made, you will be able to officially appeal by use of comparable sales. They will not allow appeals based on comparing assessments and you will not be able to appeal taxes. Appeals must be in by May 1, 2011.

I hope you’ve found this summary helpful!

-Caroline
www.CarolineGosselinHomes.com

What I Learned at Rain Camp NYC 2010!

After attending the 2010 NYC Rain Camp conference yesterday at the Marriot Marquis in Times Square I’ve been inspired to start my own blog on Maplewood, South Orange, Millburn / Short Hills, Springfield, New Jersey real estate! I live and work in these towns and have so much information to share… so why not?!

The event featured some of the best minds (Brad Andersohn , Bob Stewart) in the Active Rain community and the amount of information they gave us to process was incredible. I have an entire list of things I want to implement ASAP… this blog is my first step.

Ben Kinney of Washington state shared with us his fresh, new ideas on how to stay on the cutting edge of real estate. It takes a lot more than a static website and the MLS to promote yourself to buyers out there and to promote your client’s listings. I learned tips that I know no one else in my market place will be implementing (for the time-being anyway!). Raincamp was promoted as a must for anyone wanting proper online exposure in real estate today… They certainly delivered!

Come back to this blog in the next few weeks, I will be working to make this a one stop shop for information about real estate in Maplewood, South Orange, Millburn / Short Hills and Springfield, New Jersey! My new revamped website is almost up, in the meantime, you can visit my current one www.CarolineGosselinHomes.com.

I'd like to leave you with this powerful video about the "Social Media Revolution"... some of the statistics it quotes are astounding!

(or you can copy & paste this link: http://www.youtube.com/watch?v=sIFYPQjYhv8)

Thanks for reading!

Caroline Gosselin