VanEd Newslog

Like Halloween Ghouls, National Flood Insurance Program (NFIP) continues to run on life support

After recent House action on a continuing resolution the government funded National Flood Insurance Program (NFIP) got a reprieve and will stay on life support ~ for now. The funding for the program has been continued, again, until November 18th which should give the congress just enough time to settle differences between the House and Senate versions of reform bills.That is, if the Senate would pass their version.

The House version of a long-term extension (The Flood insurance Reform Act of 2011) has already been passed. The Senate version (The Flood Insurance Reform and Modernization Act) passed out of the Banking Committee in September. If the Senate would pass that bill then Congress could work to merge the two bills and send them to the President's desk.

However, as is sometimes the case, a new proposal from two Senators has cropped up asking that Section 107 of the Senate bill be removed prior to passage by Senate. 107 covers areas of the country that are located behind levees, dams or other flood control measures. These areas may be determined to be areas of "residual risk" and would then require Flood insurance. And even though there is already a way for the areas to be exempted but the Senators are still asking for the change, even under the time pressure put on the NFIP by the November 18th funding deadline. There are a large number of real estate transactions that require flood insurance coverage and would be placed in jeopardy by a failure of Congress to pass long term legislation.

In a recent publication Henry Harrison wrote about the NFIP as wll as his personal experience with Hurricane Irene and with FEMA personel, whom he described as "professional, courteous and genuinely helpful." He concluded his article with the following statement; "Seems Congress is once again playing brinksmanship with America's flood insurance program. After our recent experience, that doesn't seem wise to us."

You can read more from Henry's article at http://www.revmag.com/.

Finance Friday: Refinance Relief

On Monday President Obama announced a new program to help many underwater mortgagors refinance to lower rates. The details will not be out until November 15th, but this seems to be a modification of the Home Affordable Refinance Program (HARP). The expected changes include removing the 125% cap (previously the home was not eligible if the mortgage balance exceeded 125% of the current market value), lowering or removing risk based fees regarding loan to value and credit scores, and waiving certain representations and warranties that lenders commit to in selling loans to Fannie Mae or Freddie Mac. The plan applies to all mortgages that were purchased by Fannie Mae and Freddie Mac before May 31, 2009 and is available until the end of 2013. Mortgage payments must be current (with no late pays in the past six months and no more than one late pay in the past 12 months) and the borrower has to qualify based on current income.

Once the federal government began bailing out privately held Fannie Mae and Freddie Mac in September of 2008, the taxpayer assumed the default risk for these mortgages. Therefore it only makes sense to lower risk by lowering the payments.  These mortgages are all seasoned (over one year old), are current, and have a reasonable payment history. The current home value has no bearing on the borrowers ability to make the payment. The only thing that matters is the current mortgage payment. It goes to reason that reducing a borrowers monthly payment reduces the chance of default.  Also, borrowers are encouraged to shorten the term which will build equity faster which also reduces the risk to the government.

Considering that Fannie Mae and Freddie Mac own over $5 trillion of mortgages, and 22% have a balance that exceeds the current market value, the potential interest savings are huge. However, instead of just tweaking a marginal program (HARP has helped less than one million borrowers), what they really need to do is look back about 25 years to the FHA streamline refinance mortgage that has helped millions of people lower their payments. This program allowed refinancing without any income or credit qualifying and without an appraisal. As long as the interest rate and payment and or term were reduced and the mortgage was current, the refinance was allowed. The thinking was if a borrower is qualified at a six or seven percent loan, they are even more qualified at a four or five percent loan. Pretty simple, pretty effective, and would most certainly reduce the risk to the taxpayer.

Guest Author Randy Kelly is a Mortgage Banker and Finance Author with Peoples Mortgage. You can reach him online anytime by clicking here.

Spooky Halloween fee increases announced by Colorado Division of Real Estate

According to The Colorado Association of REALTORS® the Colorado Division of Real Estate announced that real estate licensing fees would be increasing beginning November 1st. The article published on the CAR website says that Director Marcia Waters from the Division of RealEstate attributes the increase in fees to a continuous drop in licensees since 2007.

If you need to verify that you have completed your renewal requirements, or if you would simply like to review those requirements, visit our Colorado License Renewal information page online at http://VanEd.com/Renew. All of the information necessary to renew your Colorado real estate license can be found on that page.

You can read the CAR Article by clicking here.

VanEd joins CAR in encouraging those licensees who are up for renewal to renew their real estate brokers license with the DRE prior to the end of October in order to avoid the November 1st dues increases.

VanEd Presents: Nebraska GRI 104: Finance course ~ available online

VanEd is proud to be the online home for the Nebraska REALTORS^® Association GRI: Graduate REALTOR^® Institute program. The Nebraska GRI 104: Finance course has been approved in Nebraska for 12 hours of Continuing Education Credit and is being offered online to Nebraska REALTORS^® for GRI, Graduate REALTOR^® Institute credit. This course covers all aspects of Real Estate Finance, including The Monetary System, Sources of Money, the Lending Process and Insurance. The course also contains a downloadable glossary of Finance Terminology.

Students will receive both CE and GRI credit for completing VanEd's online Continuing Education course in Nebraska. For details, visit the Nebraska Graduate REALTOR^® Institute program online by clicking the link below.

Nebraska GRI 104: Finance course ~ available online

 

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The Confident Rookie Series - SECRET #2 - Practice with Your Printer!

Picking up from my last installment of the Confident Rookie Series about how important it for rookies to Master Their Systems before they need them; today I'll add just a little bit more to that project.

Practice with Your Printer. This may sound silly, but when you're writing an offer for a buyer, it's nerve-wracking if you can't get the printer to work. Seriously.

I wrote my very first offer back in 1996 at 6:00 pm on a Friday night in my Coldwell Banker office. I called my broker away from Happy Hour to help me. I'd had training on the contract software and was pretty comfy there, but had never actually printed a contract.

Using my own brand new contract software (registered under my name & all!), I created the contract with my broker's help, and then went to print it out. Oops.Great big DRAFT watermark across every page. Hmmmmmm. Tried again. Same thing. My buyer was sitting in the conference room waiting for me, but neither I nor my broker could figure out what was wrong. And, being Friday night, there wasn't much chance of finding any customer service at the software company.

I was a mess and felt like an idiot. I ended up re-writing the entire contract on pre-printed forms and life went on. Turns out that I needed some activation code to remove the DRAFT watermark.

But there are all sorts of things that can go wrong when printing from new software, aren't there? Especially if you're in a networked real estate office.

So, as you're practicing with your contract software, be sure to also practice printing out the contracts. Please don't hesitate to waste paper. If your software requires legal paper, be sure you know where it is and how to load it. If you have the option of either legal or letter, be sure you know how to select the one you want. Know how to "insert" or "remove" n/a's and such.

And... always have a back-up plan. Here's mine:

• Plan A:  Business as usual - use the regular office printer
• Plan B:  If that fails, try the other printer at the office (we have two)
• Plan C: If both of those fail, email the contract to the receptionist to print out
• Plan D: If I'm really crashing & burning, know where the pre-printed contracts are and write it up manually.

Again, I know this sounds trivial and even silly, but just wait until YOUR buyer is sitting in the conference room waiting to sign his offer and you can't produce anything for him to sign!

The Confident Rookie Series:

1. Know Your Systems
2. Practice with Your Printer
3. Preview, Preview, Preview
4. Drive Your Route Ahead of Time
5. Cheerfully Waste Your Time
6. Find Your Handyman
7. Let Your Seller Prospect Do Most of the Talking
8. Get Comfy with Your Commission
9. Admit that You're New
10. What to say when you don't know the answer

Stay tuned...

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Guest Author Jennifer Allan-Hagedorn has authored five books and multiple courses designed to teach agents her Sell with Soul philosophy that centers on four interrelated principles: Respect, Competence, Confidence and Enthusiasm.  The latest release of her book is available in the VanEd bookstore. You can also visit her online at www.sellwithsoul.com or attend one of her free teleseminars on a variety of topics of interest to the real estate community.

NAR continues the Home ownership Matters Public Advocacy Campaign

The NAR Home Ownership Matters Public Advocacy Campaign continues to promote the benefits and pride that home ownership affords. the campaign, which includes TV and radio ads as well as a bus tour, touts the advantages to not only the individual but also the community at large, including;

For every two homes sold, one job is created.

Each home purchased pumps up to $60,000 into the economy.

Home ownership accounts for over $2 trillion of the U.S. GDP.

Update: The NAR Bus Tour is scheduled to Visit Las Vegas! Take part in the Home Ownership Matters consumer event in Las Vegas, NV on Oct. 25. Learn More >

Learn more about the Home Ownership Matters initiatives by visiting the Realtor.org web site or by clicking here.

Finance Friday: IRS announces increases to many tax breaks for 2012

In a recent news release the IRS announced that many tax breaks would increase in value due to adjustments for inflation. We have included A couple of the items below. At the bottom of this post you will find a link to the IRS news release. We will also be updating our Taxation and Finance courses over the next month to assist students who are using this information in their practice.

Issue Number:    IR-2011-104     October 20, 2011

In 2012, Many Tax Benefits Increase Due to Inflation Adjustments

WASHINGTON — For tax year 2012, personal exemptions and standard deductions will rise and tax brackets will widen due to inflation, the Internal Revenue Service announced today.

(items included in the notice)

• The value of each personal and dependent exemption, available to most taxpayers, is $3,800, up $100 from 2011.
• The new standard deduction is $11,900 for married couples filing a joint return, up $300, $5,950 for singles and married individuals filing separately, up $150, and $8,700 for heads of household, up $200. Nearly two out of three taxpayers take the standard deduction, rather than itemizing deductions, such as mortgage interest, charitable contributions and state and local taxes.
• Tax-bracket thresholds increase for each filing status. For a married couple filing a joint return, for example, the taxable-income threshold separating the 15-percent bracket from the 25-percent bracket is $70,700, up from $69,000 in 2011.

Estate and Gift

For an estate of any decedent dying during calendar year 2012, the basic exclusion from estate tax amount is $5,120,000, up from $5,000,000 for calendar year 2011. Also, if the executor chooses to use the special use valuation method for qualified real property, the aggregate decrease in the value of the property resulting from the choice cannot exceed $1,040,000, up from $1,020,000 for 2011.

The annual exclusion for gifts remains at $13,000.

Note: These are selected relevant items - click the link below to see the entire notice from the IRS.

http://1.usa.gov/mOsPkw

REALTORS® Conference & Expo is less than a month away - Seize the Day!

Every fall, real estate professionals from across the U.S. and around the world come together for the annual REALTORS® Conference & Expo. This annual four-day event includes:

• More than 100 education sessions, featuring nationally-recognized speakers, trainers, and industry experts, who discuss timely topics and critical issues of value to REALTORS®
• 400 industry vendors at the expo, who present the latest innovative tools just for real estate professionals
• Unlimited networking and referral-building opportunities, including special events, networking lounges, and the expo show floor

In 2011, the REALTORS® Conference & Expo will be held in sunny Anaheim, California, November 11-14. This year’s theme is SEIZE THE DAY, and indeed, this year’s Conference & Expo will help REALTORS® make the most of the current market, and gain a competitive edge over the competition. 18,000 members and guests are expected to attend this year’s event. Remember, it takes only one referral to pay for the REALTORS® Conference & Expo.

Join VanEd is Anaheim!It's not too late to register to attend the conference. Visit the NAR Annual conference website to register or for more on what events and sessions are available to you. Click Here to visit the conference site.

VanEd Presents: South Dakota Graduate REALTOR® Institute (GRI) designation available online

In today's competitive business environment you need more than just motivation and initiative to succeed, you need the advantage of the education you receive in the GRI program.

The Graduate REALTOR® Institute (GRI) designation indicates to buyers, sellers and other real estate industry professionals that you have made the commitment to provide a high level of professional service to your clients by securing a strong educational foundation.

VanEd is proud to provide the GRI program on-line for the State REALTOR® Associations in Colorado, Wyoming and Nebraska. And VanEd is proud to announce the one year anniversary of hosting the South Dakota GRI Program.  Click on the links to learn more about earning the GRI in your state, or visit http://www.vaned.com/GRI for more information.

Improving energy efficiency starts with a home energy rating

Maybe your clients want to qualify for an energy efficient mortgage, or maybe they just want to make their existing house more efficient. In either case, the best place to start is with a home energy rating. This information is brought to you by VanEd and EcoBroker. For more information on Home Energy Ratings, click here to read an article from EcoBroker. You can learn more about the EcoBroker designation by visiting www.vaned.com/EcoBroker.

An energy rating can provide a home owner with a detailed picture of their home’s energy performance, and also recommend the most appropriate and cost-effective options for improving its efficiency. Many times, these energy efficiency upgrades can significantly increase a property’s resale value!

Energy ratings are performed by Certified Home Energy Raters, and can be performed on both new and existing homes. They may also be used to qualify a home for an energy-efficient mortgage.