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Loan mod companies settle with FTC for $2.2M Premium Content

By Inman News, Monday, April 11, 2011.

A family that operated two Florida-based companies that promised to help distressed homeowners obtain loan modifications has agreed to surrender $2.2 million in assets to settle charges that the companies' representatives violated laws governing telemarketers.

The Federal Trade Commission shut down Kirkland Young LLC in November 2009, alleging that the company and manager David Botton misrepresented themselves as mortgage lenders, servicers, or their affiliates, and made false promises to homeowners that they would help them obtain loan modifications.

A month later, the FTC added a related company, Attorney Aid LLC, as a defendant, along with Botton's sister, April Botton Krawiecki, and father, Samy Botton.

In a complaint and other court filings, the FTC charged the companies conducted a national telemarketing campaign that led distressed homeowners to believe they were being contacted by their mortgage lender, loan servicer, or an affiliated company.  more...

Real estate inheritance tax tips

By Benny Kass, Monday, April 11, 2011.

DEAR BENNY: I am a retired widow who owns two homes. I have two children. Is it possible for each one to be a co-owner with me: one child on one house and the other on the second property? How would I go about doing this? Would that save anything on taxes, etc., for my two adult children? Would it cost me anything other than the filing fee for the property ownership papers of each of the homes?

My estate isn't huge, but the inheritance taxes would take up quite a bit of money. They would each naturally inherit the homes, but doing it the way I propose would give me the power to will a specific home to each child with no arguments over any value difference. --Evelyn

DEAR EVELYN: I get this question all too often, and my standard response is that there may be serious tax consequences when a parent adds his or her children to title on a house.

Let's say you bought the property for $50,000 and it is now worth $300,000. Your basis for tax purposes (a number that is important in determining capital gains tax) is $50,000. If you give half of the property to one of your children, his or her basis will be $25,000.  more...

Personal finance for the math-challenged

By Tara-Nicholle Nelson, Monday, April 11, 2011.
Cover image courtesy of <a href="http://us.penguingroup.com/nf/Book/BookDisplay/0,,9780399536441,00.html?The_Real_Cost_of_Living_Carmen_Wong_Ulrich#">Penguin.com</a>.

Personal finance maven Carmen Wong Ulrich applies the model of cost-benefit analyses to a variety of personal and financial decisions -- your personal business, if you will -- in her latest book, "The Real Cost of Living: Making the Best Choices for You, Your Life and Your Money."

And boring, this book is not! Wong Ulrich's approach explodes the age-old tradition of looking at the dollars and cents cost of personal finance decisions, and looks at both the personal (i.e., psychological, emotional, lifestyle and other) and financial costs of all sorts of personal decisions that have financial implications, from getting married to maintaining your bad habits, to becoming your own boss and deciding whether to work or stay home with your children.

Her goal? To explore the myriad personal and financial factors that should be calculated for during our daily life decision-making, which sometimes even validates decisions that are not the smartest money move per se, but do further personal values and priorities that outrank the bottom line.

For example, Wong Ulrich surfaces a number of instances in which personal priorities can and often should outrank the financials of a fact scenario, in terms of their impact on our decision-making. Like paying off your mortgage -- a move that the financial experts have long pooh-poohed, but which has the vast emotional advantage of stability and security for those who are able to pull it off.  more...

Recipe for a trouble-free real estate deal

By Dian Hymer, Monday, April 11, 2011.

Home-sale problems usually derive from three sources: property inspections, the buyer's financing, or the appraisal of the property. Any one of these can crater a deal. Being proactive is the secret to avoiding problems, if possible.

It can't be emphasized too much how important it is to have the property fully inspected by qualified local inspectors. Check the permit history and ask the sellers for answers to any questions you have.

Along with this, sellers should disclose what they know about the property that might impact a buyer's decision to buy or the price she'd pay, even if not required to do so by law. State disclosure laws vary from one state to the next.

Sellers who fear that telling all will keep their home from selling should consider the consequences of concealing something negative, like a leaky roof or a basement that floods when it rains. Withholding information and getting sued later is likely to be far more costly and time consuming than coming clean even if you have to make a price concession to compensate the buyer for defects she'll need to repair.  more...

Pay early, save on mortgage interest

By Jack Guttentag, Monday, April 11, 2011.

A frequently asked question is whether a mortgage borrower receives any benefit from paying before the due date. In most cases, the answer is "no," but there are a few exceptions. With simple-interest mortgages, including HELOCs (home equity lines of credit), it does pay to pay early and, under some circumstances, paying early in order to shift next year's interest into this year could reduce taxes.

The rules when payments are late: On a standard monthly payment mortgage, the payment is due on the first day of the month, and will be credited to the borrower on that day, regardless of when it is received. If the payment is received within the grace period, customarily the first 10 or 15 days, the borrower receives a free ride -- no interest accrual -- for those days.

If the payment is received after the grace period but within the month, the borrower is subject to a late charge. If the payment is not received until the following month, the borrower incurs a late charge and is reported to the credit bureaus as a 30-day delinquency, but the payment is credited as of the first day of the previous month.

When payments are early: Payments made before the due date are also credited as of that date. This gives the lender free use of the borrower's money for that period. The borrower who consistently pays two weeks early, for example, is in effect providing the lender with a two-week grace period comparable to that provided by the lender to borrowers who pay late. There is no benefit to the borrower.  more...

Coach, mentor, trainer: pick the right path for your real estate growth

By Bernice Ross, Monday, April 11, 2011.

Are you ready to double or triple your real estate income? Who is the best person to get you there: A coach, a trainer or a mentor?

I've been in the real estate training business since 1989 and started my coaching website back in 1996. During this time, two important facts have become apparent.

First, most real estate professionals who want "coaching" are really looking for real estate sales training. Second, there is tremendous confusion about what constitutes coaching, training, and mentoring.

Depending on what you want to achieve, each of these approaches is a viable way to increase your income. Here's how to tell whether training, coaching, or mentoring is the best choice to help you achieve your goals.

1. Real estate sales training

Training teaches you a skill or a strategy for your business. This can include how to conduct a listing presentation, scripts for working with buyers, or how to use Web tools or mobile apps. In each of these examples, the trainer is the expert who is showing you what to do and how to do it.  more...

Military families battle real estate distress

By Mary Umberger, Monday, April 11, 2011.
Jennifer Hernandez

Real estate agent Jennifer Hernandez knows about the squeeze that military families, faced with a transfer to a new place of duty, are feeling these days because the homes they bought during the housing boom are "upside-down" -- worth less than the balance owed on their mortgages.

These families don't have the option of just staying put -- a service member can't just say "no thanks" to a change of station, as it's known in the military -- so they face the prospect of a short sale or foreclosure because a normal sale probably wouldn't yield enough to pay off their loans.

Hernandez hears their stories. She advises them of their options. But she's more than just a sympathetic professional: She's in the same boat.

And she'd like to get the word out that this is a widespread problem for military families today.  more...

Frank Howard Allen expands to California's wine country

By Inman News, Friday, April 8, 2011.

Frank Howard Allen Realtors has opened six new company-owned offices in Northern California's wine country, the brokerage announced last Friday.

Frank Howard Allen is based in Novato, Calif., and focuses on the North Bay region of the San Francisco Bay Area. The brokerage's new offices are located in Napa and Sonoma counties, the heart of California's wine country.

The offices bring the brokerage's total office count to 23: 16 company-owned and seven independently owned and operated offices.

Three dozen agents, most of them working at the new offices, joined Frank Howard Allen in the first quarter, bringing the brokerage's agent count to more than 450.

"In a time of nationwide cutbacks and closures, we are fortunate to be in a position where we can grow and expand," said Noreen Smith, the brokerage's president and chief operating officer, in a statement.  more...

Economic siege upstages political standoff Premium Content

By Lou Barnes, Friday, April 8, 2011.

Financial markets are on sharp edges despite the absence of significant economic data. This shutdown foolishness holds the media's center stage, but that's not what's on the minds of markets.

One thing there towers over all: We're either entering a spate of global inflation, with central banks late to the party ... or we're not.

The 10-year T-note is out of bounds, up at 3.6 percent and taking mortgages above 5 percent. Japan and Libya forgotten, oil is at $111 a barrel, gold at $1,468 an ounce, and silver at $40 an ounce.

That gold price is more than double the cost of new production, and silver easily quadruple -- the sign that "momentum" traders are chasing each others' tails. If we are ramping to global inflation, those tails are a good catch.

If this episode is a replay of the summer of 2008, the momentum boys are going to end up with a mouthful of fur and look really, really silly.  more...

Chicago real estate broker first to offer Groupon

By Matt Carter, Friday, April 8, 2011.
Groupon.com screenshot of <a href="http://www.groupon.com/deals/dream-town-realty">Dream Town Realty offer</a>.

A Chicago-based real estate brokerage that wants to convert more visitors to its Virtual Office Website into clients is the first brokerage in the country to offer a deal through Groupon.

Dream Town Realty -- a full service brokerage -- is offering $1,000 cash at closing to buyers or sellers who purchase a $25 Groupon.

At midday Friday, less than 12 hours after it was made available for five days, the Groupon offer was rapidly approaching the 50-buyer minimum, and generating publicity for the company. There is no upper limit on the number of Groupon offers that will be sold, said Dream Town's president and co-founder, Yuval Degani.

"Unlike a restaurant, which can overbook if it oversells (a Groupon offer), there is no limit to what we can do," Degani said. "We will honor as many as purchased."

The offer has sparked a "media craze," with the Chicago Tribune running an item and blogs and social media sites picking up on the story, he said.  more...

HotPads launches real estate app for Android tablets

By Inman News, Friday, April 8, 2011.

Property search site HotPads has released a free mobile application for tablets running the Honeycomb version of Google's Android platform, the site announced Friday.

HotPads' iPad app rolled out about a week ago and has received more than 1,100 downloads so far, the company reported. The HotPads site is closing in on 4.5 million monthly users, of which 10 percent are accessing HotPads from mobile apps, according to company spokesperson Paul Gleger.

HotPads' Android tablet app has all the same features as the iPad app. Users can search for for-sale homes, rentals, and hotels either nearby or at a location they specify.

They can filter their results, view listing details and photos, save favorite searches and listings, share listings via email or Facebook, and contact an agent directly from the app. In map view, users can open a listing page and still navigate the map on one screen.  more...

Real estate agents: What if you can't pay taxes now?

By Stephen Fishman, Friday, April 8, 2011.

Your income taxes are due on April 18. What should you do if you can't pay what you owe?

File your tax return

First and foremost, even if you can't pay, you should file your tax return on time. The penalties for not filing a return are severe: 5 percent per month on the amount you owe, to a maximum of 25 percent reached after five months.

This is in addition to the interest the Internal Revenue Service charges for paying your taxes late. Filing your return -- even if you can't pay what you owe -- will at least avoid this penalty.

Borrow the money

The interest rate on a loan or credit card may be lower than the combination of penalties and interest imposed by the IRS. As a result, it could be cheaper to borrow money or use your credit card to pay what you owe.  more...

Ruling: Michigan MLS restrained competition

By Matt Carter, Thursday, April 7, 2011.

Michigan's largest multiple listing service "unreasonably restrained competition" among real estate brokers by refusing to transmit exclusive agency property listings favored by discount brokers to Realtor.com and other public-facing Web sites, a federal appeals court has ruled.

Farmington Hills, Mich.-based Realcomp II Ltd. has "substantial market power" in Southeastern Michigan, and its website policies resulted in "actual anticompetitive effects," the Sixth Circuit Court of Appeals said in denying the MLS's petition to overturn a 2009 Federal Trade Commission order that the MLS rescind them.

With $725,000 in backing from the National Association of Realtors, Realcomp has waged a 4 1/2-year legal battle with the FTC over its treatment of exclusive agency listings, racking up legal expenses of more than $2.4 million.

Although the MLS could appeal the latest decision, Realcomp CEO Karen Kage said she had not reviewed all of the documents in the case, and declined to comment. A NAR spokesman did not immediately respond to a request for comment.  more...

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