Coming up with the downpayment can be the largest hurdle for many first time home buyers. Nearly 20 states have already established a “Bridge Loan” program so first time home buyers can borrow against the pending tax credit payment, allowing the $8,000 to be applied towards the downpayment at closing. The Montana Assn of Realtors, along with the Montana Building Industry Assn, Montana Board of Housing, Montana Bankers Assn, & NeighborWorks, are working with both political parties and the governor’s office to establish a similar program in Montana. When/If this becomes available, I will post an update on this blog with details of the program.
March 28, 2009
March 5, 2009
What’s a safe real estate investment in today’s world?
If you’re looking for a relatively long term safe haven investment these days, what has the lowest risk? Retail properties risk having tenants closing locations and sites going dark. Office users are downsizing and consolidating operations. If a corporation files bankruptcy, your lease doesn’t do you much good. Empty space generates no return on investment. So what real estate is immune from these types of risks? Long-term leased federal office buildings will always have a rent check delivered on time with no risk of it bouncing when you get it to the bank. If you want to be the sole owner, entry level on these types of properties is usually around the two million dollar range . I have a developer of these types of investments that currently has properties available anywhere from $2.5 million up to about $20 million. These are class A or B office buildings built within the last year with 10-15 year leases in place. Rates of return generally run around 6.5-7%. Compared to annuities guaranteed by private insurance companies, these look pretty warm and fuzzy these days.
March 4, 2009
Montana Homestead Exemption
If your principle residence is in Montana and you haven’t already filed a Homestead Declaration, you should do so. It’s a one page document that you can fill out in 5 minutes, get notorized, and file with the county clerk & recorder for about $10. It will protect the first $250,000 of equity in your home from creditors. Mortgages and construction leins on the home are not covered by the exemption as well as Medicaid leins placed pursuant to the Montana Estate and Recovery Program.
The Homestead Declaration form can be filled out online and printed for signatures & notarizing here. A Homestead Declaration can be undone by filing a Declaration of Abandonment. (For instance, if you sold one home and bought another.)
March 1, 2009
Are Life Insurance Companies Next?
There was a sobering article on MSN Money a few days ago eluding to the possibility that life insurance companies with heavy exposure in mortgage backed securities and other risky investment vehicles could be the next to fall.
Over the last several months, life insurers have been hit by downgrades from every ratings agency, reflecting their exposure to volatile credit and investment market conditions. Those investors that are invested in longer-range products that involve significant upfront funding like annuities should be most concerned.
See the complete article here.
Buying Time to Avoid Foreclosure
Sometimes a foreclosure can be avoided if you’ve just got a little more time to come up with past due payments or to get the property sold. I came across an interesting tip the other day that I thought I’d pass on. If you demand in writing, that the holder of the note produce the original mortgage document, they are required by law to produce it before they can take your property. Mortgages are typically bundled and sold to other financial institutions who re-bundle and re-sell to investors. Servicing can be passed from company to company. Years down the road, tracking down the location of the original mortgage document could take several weeks. That delay might buy you the additional month or two that could make the difference in avoiding a foreclosure. I’d suggest talking to an attorney to verify the process and the most effective time to execute this move.