With a 98 to 0 vote, the senate voted to extend the first time homebuyer tax credit yesterday.  Moreover, the vote also calls for an expansion of the credit to current homeowners.

The details:

The current first time homebuyer tax credit is set to expire November 30, 2009.  This means that a closing must take place by this date.  In other words, the current credit is over.  Today’s the 5th of November.  With Thanksgiving just around the corner, it would be hard to put a home under contract today and confidently expect it to close before December.  It can be done, but it’s not a guarantee.

The extension calls for a credit to be given for all contracts written by April 30, 2010 and closed by June 30, 2010.  I’m not sure how that will be monitored if it goes in to effect.  In other words, I’m not sure how you could stop a buyer from back-dating a contract — we’ll just have to see.

Regarding expansion, the new credit — if passed — would allow existing home owners who have lived in their current home for 5 years or more to take a $6500 credit if they buy a new home.

Also, the Senate bill would raise the adjusted gross income cap to $125,000 for single filers and $225,000 for joint filers. The amount of the credit currently begins to phase out for taxpayers whose adjusted gross income is more than $75,000, or $150,000 for joint filers.

Tower Grove South 4 bedroom/ 1.5 bath

4 Bedroom/1.5 bathroom, all brick, updated bungalow in Tower Grove South located at 4108 Wyoming, near Morganford shopping and restaurants. Many updates including new furnace and A/C, new siding (accent). Kitchen has refinished cabinets, new counters, new appliances (gas range). Baths have new vanities, new ceramic. Wood floors refinished in 2007. Living Room, Dining Room and Kitchen are open to one another and feature hardwood floors, arched openings and lots of windows/natural light. Freshly painted walls and moldings just completed. 2 nice bedrooms on main level with full bath. Upstairs are 2 enormous bedrooms. This home has tons of closet space including cedar closet! Lower level is dry and partially finished — great family room space. Large, fenced, level yard backs to beautiful church — very private. 10×14x10 new, metal storage shed stays with the house. Home Warranty incl. Typical Bills… Gas Summer — $60, Gas Winter — $125, Electric (Budget) — $63, Sewer — $35, Water $70/3 months.

Just listed for $149,900.  To schedule a showing, please contact me at 314 267 2636.

Contary to popular belief the first step in buying a home in St. Louis is not calling your favorite Realtor and asking to see a bunch of properties.  The first step is to get approved for a loan.  

Here’s Why…

Getting approved for a loan takes more time today than ever before.  A good offer in this economy has a quick closing date.  In many cases, I can save you $1000s of dollars if you are willing and able to close soon.  Lots of the properties I show are vacant.  The sellers are anxious to get a contract and close.  But if you haven’t applied for your loan with your lender, you cannot close quickly. 

The St. Louis Mortgage lender you choose can give us a good feel for your “credit-worthiness” with just a short phone call and a credit check.  But he cannot give us a final decision unless you have submitted support documents that back up your financial story.  

I’ve been working with a young couple for a few weeks that has a number of student loans.  In order to qualify, these student loans need to be placed in deferment.  Rather than potentially wasting my buyer’s time (and mine) looking for houses, we need to get the loan approved.  Supporting documents for the deferment must be put in place.  

The security of having a full credit approval allows the buyer to shop with confidence.  Further, it strengthens any offer put on a property.

The Stewarts -- First Time Homebuyers, no credit

Here’s a problem that you don’t think about very often…  Boy meets girl.  Boy and girl fall in love.  Boy and girl find a nice apartment together and pay all of their bills on time.  Happy couple opens no credit cards and pays cash for cars because girl’s Dad told them the horrors of consumer debt.  Happy couple decides it’s time to buy a house.  Sad couple is declined for loan because they have no credit.

No credit is just as bad as bad credit!

So what do you do if you find yourself in this unfortunate predicament?

First step is to open a credit card and buy your gas and groceries on it.  Pay it in full every month.  Maybe get a card with an airlines frequent flier reward program — that way you can rack up a few miles while you use the card.  By doing this, you will begin to build credit — good credit!

Second, you make sure that your Realtor has provided you with a great referral to a competent lender who can help you deal with this strange situation.  I use Matt Eversgerd at First Integrity Mortgage Services.   Matt and I are working a transaction right now with the Stewarts — they want to buy a home in Webster Groves.  We found them a cute house in Tuxedo Park– $199,000.  Upon pulling credit, this young couple has no scores.  Matt is in the process of building a credit score for them.  Because First Integrity Mortgage Services has in-house underwriters, they are able to put together a decision quickly.  If your lender’s underwriting team is located off-site (which is how 95% of mortgage brokers operate), files have to be mailed back and forth for approvals.  Matt will be able to get the Stewarts approved for this house.  He has never failed me.  

Third, you need to have a Realtor who has dealt with these types of problems before.  Not all Realtors are good — in fact, the typical Realtor only sells 2 or 3 houses a year.  They cannot possibly have the experience necessary to deal with problems that pop up — and problems often pop up!

My team of Realtors has decades of experience, we sell a ton of houses, we’re ranked in the top 1% of Realtors in St. Louis.  Call me.  314 267 2636

Building Blocks, a blog on the Saint Louis Post-Dispatch’s website, recently posted an interesting article entitled “Is the worst of the St. Louis housing slump behind us?”

The market is strange. I sold more St. Louis, MO, homes in 2008 than ever before in my 10 year career as a Realtor. But I noticed sales starting to slump in late October 2008. The winter has been tough.

Fast forward to the present…my 20 St. Louis Metro area house listings are starting to get activity. People in all price ranges are starting to look again. Buyers are choosier than they used to be. They spend a great deal of time looking at every option. I showed one couple 35 properties. Everyone seems to think that the amazing deal is out there.

In my central and west county market, the Selling Price to List Price ratio is just over 95% since Jan 1. This should show you that the buyers who are successfully closing are paying pretty close to asking price.

It’s hard to tell if the slump is over, or if we are just seeing the Spring up-tick.  But one thing I know is certain:  

Russell Nolting
http://www.NoltingRealEstate.com

2657 S. 59th Street, St Louis, MO 63139 is a charming all-brick 2 bedroom on the hill. New kitchen updated with countertops, maple cabinets, backsplash. Stainless appliances including built in microwave. Unique inlaid hardwood floors (see pictures!). The updated bath is light and bright with a vintage herringbone tiled floor. The attic is finished and features a walk-in closet, exposed brick walls and new frieze carpeting. Enclosed sunroom overlooks large, fenced yard. Newer roof with architectural shingles. One car detached rear entry garage.

Home is conveniently located off Hampton and is a short drive to Forest Park, the St. Louis Zoo, Steinberg Skating Rink, the St. Louis Science Center and more.  

For more information and pictures, please visit you St. Louis real estate Listings site.

Financing Condos in St. Louis

There is a serious financing problem with condos in St. Louis and throughout the country.  A little background… lenders love homebuyers to have 20% down.  These loans have very little risk.  When you put down less than 20%, lenders typically require that you get PMI, or Private Mortgage Insurance.  PMI is an insurance policy, paid monthly (rates based upon loan amount and credit scores — usually about 0.7% of the loan amount annually), that insures your loan in the event that you default.  

Recently, PMI companies have decided to stop insuring condo loans in “distressed” markets.  Distressed markets are housing markets that will likely continue to see declines in home value values.  Mortgage investors are considering St. Louis a “distressed” area in terms of home values.  We are not alone in this. 

Bottom line is this:  If you want to buy a condo in St. Louis, you must have 20% to put down.  Conversely, if you need to sell a condo in St. Louis, you will have to find a buyer who can put 20% down.  The ramifications are obvious, aren’t they?  It’s going to take a long time to find a buyer.

FHA is an answer to this problem.  FHA continues to loan 96.5% of the purchase price to qualified buyers — even on condos.  Here’s the catch:  Not every condo complex is FHA approved.  FHA loans are only available on select developments.  

The other answer to this crisis is the portfolio loan.  The portfolio loan is a loan from a smaller bank that will keep the loan in house and not sell to Fannie Mae or Freddie Mac.  Because they are not selling off the loan, they are able to make their own decisions on whether or not to loan.  Typically the rate will be higher and the terms less beneficial to the owner.

If you’re in the market for a St. Louis condo, you need an expert lender.  Call Matt Eversgerd of First Integrity Mortgage Services for professional advice.  His number is 314-620-7227.