Tina To's Real Estate Blog

Have you ever forgot familiar words or names or the location of keys, eyeglasses or other everyday objects?  According to the Seven Stages of Alzheimer’s Disease from www.alz.org, the Alzheimer’s Association, this is the typlical symptom of the Second stage of Alzheimer.

Recently I have read a book “Jan’s Story” by Barry Petersen.  Barry’s wife has an early onset of Alzheimer at age 55.  But during the early stages. Barry had not taken the opportunity to go to places where they always wanted  to go, do things that they had longed to do because Barry thought he still have “time”.  However, Alzheimer’s disease really do not have a timeline and full of unknown, the disease can progress suddenly without any warning.  Barry regretted a lot but who does not.  I guess regarding this, Barry is not alone.  We always put up things that we think we still have time, aren’t we?

There is also another debatable issue that despite Barry and Jan had married for 20 years and love each others ever since, Barry was encouraged to look for a new partner, another sole mate.  This would be extremely difficult if Barry was in the Chinese society.  Traditional Chinese values eternal love and that eternal love means loyalty.  Barry should not physically depart his wife not mentioning mentally.  Barry also spells out clearly the meaning of marriage that is there is love between husband and wife and they take care each others, be each other’s soulmate.   This is a pretty high standard to uphold and  I think at least 50% of married couples had not reached.  Many couples are together out of needs but not out of love.   At least this is true to one of my friends’. 

What is your opinion regarding this?  If you have time, I would recommend you to read this book Jan’s Story by Barry Petersen which will come out in June 15, 2010.  (The one I read is Advance Reader’s Edition , meaning not finalized in editing and I bought it from the   Main Library in San Francisco.)

Image by Getty Images via @daylife

REO  is the short form for Real Estate Owned.  The real meaning is the lenders, usually the banks, have taken over the properties and are actually owners of the properties.  When the properties put up to the market for sale, the lenders/banks had already come up to an agree upon for sale price so usually if the buyers offer the asking price, it will be approved.  However, some lenders/banks will still listen to the sale experts marketing strategy, i.e. to ask for a ridiculously low price to encourage strong competition and thus beat up the sold price.  Anyway, the buyers involved usually can close the escrow within a reasonable time like a normal sale.

Short Sale means even after the sold price of the property is still too short to pay the mortgage.  In this case, the individuals are still owners of the properties and not the lenders.  However, since the homeowners cannot bring additional money to pay back to the bank/lenders, the sold price has to be approved by the lenders.  Since in this case, it is the homeowners who initiated to sell the property to avoid foreclosure, the lenders/banks involved had not yet came up to an agreed upon price prior to the property put for sale in the market, every offer has to be reviewed by the lenders/banks involved.  Thus it usually takes a much longer time for closing.

Tina, although she was a rabel as a teenager, she actually is quite traditional.  She gives me a new angle of looking at parent-children relationship.  I totally agree with her that when our children uplive our hopes and will, we would proudly say, they are my sons/daughters.  But when they walk some weird path (at least from the parent’s point of view), she would call her child – friend.

Do you have a friend or have a son or a daughter?

When Tina’s only daughter told her mother she wanted to change into the male, Tina just asked her daughter to do more researches and discussed with her later.  Tina, is quite traditional in this area.  She considered changing sex was against the nature.  However, she compromised with her daughter’s decision.  And her daughter became her “friend”.

Parents:  Have you ever noticed the way you say “your” or “my” when you addressed your son/daughter with your spouse?  Let me give you an example.  When my son did something wrong, I would subconsciously, told my husband, “go get YOUR son”.  But when my son showed me his report cards with all As, I would say, “come, look at MY son’s results.”

How many of you are like me?  Picture below is My son and Your son.

Going Green is not only a fashion but a MUST.  But everyone without asking knows the issue is always about money.

If I come to you today and say, “Hey, I will install the solar energy for your home and gaurantee you will save 25% in your energy bill for free, will you do it?”  I bet, everyone will say YES and find no reasons to object.

Now, the government of San Francisco has passed something SIMILAR, but of course, not exactly.  How about if I tell you after you install your solar energy roof etc, the money you save on your utility bill will be sufficient to pay back the loan you get from the government?

This is still in a very initial stage and nobody has applied the funding yet.  In short, anyone can go to www.greenfinancesf.org and apply online for “going Green on your home”.  The application fee is $300 and to hire an energy auditor to put up a proposal is “free” according to one of the approved auditor I talked to.  However, the audit process might take several hours and is not a simple clip broad type of inspection.  The current interest rate posted on the website said 7% and the paid back period will be spread according to the expected life span of the new instrunments such as solar panels of the roof (approximately 20 years) and the repayment is by paying the special tax portion of the property tax.  This 7% can also be treated by mortgage interest and claimed deductible from the ordinary income tax portion.

If you live in San Francisco and is interested in this kind of improvement to your homes, I urge you to go online and dig into more details or attend the public meeting.

I was inspired by reading the book “Journey of a Thousand Miles: My story” by Lang Lang.  I read this in Chinese version.

For those who are not interested in music, particularly piano, may not know who is Lang Lang.  Lang Lang is the youngest famous pianist in this century so far.  I am not going to summarized his story because you can check it out from his book by which I believe should be the English version and/or should be the original.

Lang Lang won the first place as young as 5 years old.  After he watched the cartoon “Jerry and Tom”, he could replay the background music when he was only 3 years old.  Before he could read words, he could read notes.  He was recognized and had been set a goal as “the great pianist” as young as he was 3 years old.  I said set the goal because this goal was not set by him but by his parents.  His parents had sacrificed a lot to help him to reach where he is now.  Aged 9, Lang Lang left his mother and moved to Beijing together with his father.  His mother had to stay at work in Sheng Yang to support them financially.  In order for Lang Lang to be further trained and reach his parents? Lang Lang’s? goal, Lang Lang’s father became Lang Lang’s full time supervisor – to supervise and gaurantee Lang Lang had practised to his maximum ability and strength.  Lang Lang had practised mimumum 7 hours daily, 7 days a week since childhood.  All Lang Lang has is piano practice and nothing else. 

Lang Lang is very talented but unfortunately to say, Chinese has too much political reasons to restrain his growth and development.  Lang Lang’s father finally took Lang Lang to USA and Lang Lang’s talents and efforts had successfully earn himself the scholorship into the famous Musical Institute at Philapdelphia.  He later became very successful and recognized by the world.  HOWEVER, WHEN HE WANTED TO RETURN CHINA TO PERFORM, HE HAD BEEN VIGOROUSLY REFUSED TO DO SO.  The reason is he had not earned enough competitions and was not famous in China.  In China, an artist’s role has to be realized by the number of  trophy that artist has. !!!

The real reason:  Lang Lang is not from a rich family.  He does not has any Chinese official to back him up.  In the strong sea of competition, not only in piano, or in music but in all areas, athelets and other competitors may be pre-selected already.  If Chairman X’s son has certain talent, the selective board should make him the first place and if only the first place can join the international competition, then he has to be the one and try all the streams to block other OSTACLE “Lang Lang” OUT.  As throughout this book, you will see Lang Lang had met many people (all are Chinese, a few even his teachers)  said “Lang Lang, for sure you will not win!”  trying to down put him, making him not to win.

I, myself, am Chinese but fortunately I was born and raised in Hong Kong.  I could not say that I have the best education, but I have the freedom to speak, to think and to act.  I bet Lang Lang, in some way, is quite disappointed with his ‘MOTHER” – China because only recently his talent and achievements were recognized.  China, actually, has the resources and abilities to help Lang Lang to achieve what he acheives today, but refused to do so despite Lang Lang and his father’s vigorous efforts.  I feel shame on this and the pain is, this has not ceased yet.

China has literally abandoned Lang Lang in his early years.  On the other hand, it is America who saved him and allowed him to be what he is.  This is many Chinese’s American dream and this is also many immigrant’s dream.

I was impressed by Tina’s interview at “Dine with Stephen Chen” at the TVB show.  Tina became the movie star as young as 16.  Without training, without experience, Tina ventured to go to Thailand.  Once she stepped down the isle from the airplane, she was greeted by her “fans”.  This pissed her off right away.  How in the whole world could she be recognized and welcomed since she was so green as an actress (not yet acting)?  From that moment, she looked down on movie making.  She did not hold up the minimum ethnics of an actor should have.  She would disappear and let the whole team waiting for hours in shooting movie.  I consider this as intelligent because if I were her.  I would make believe that I really am a great movie star.  That is what we call “the Star came out of Commercials”.

What do you think?

You cannot control the length of your life, but you can “widen” it.

You cannot control the weather, but you can control how you feel. – Some people feel sad because it rains and they cannot go out.  Some people feel good because it rains and they can enjoy their home more.  Who are you?

You cannot change how you look (to certain extent) but you can always smile.

You cannot change others but you can change yourself.

You cannot predict tomorrow but you can make good use of today.

You cannot win everything but you can always try your very best.

Here is my client’s question:

I love the property but after I have spent $500 for the home inspection, I find out that I need to at least spend $30,000 in order to be able to move into it.  So I asked the seller to lower $30,000 so that I can reserve $30,000 from my downpayment to pay for the immediate repair.  But the seller refused to do so and I still like the property, what should I do?

If you were her, what would you do?

1.  Back out from the contract if there is no penalty incur.

2.  Ask less from the seller, instead of $30,000, ask for lowering of $15,000.

What is the difference between active, contingent and pending listings?

When a property put up on the market for sale, we call it an active listing meaning the seller is actively looking for buyers.

When sellers and buyers get into a written contract with an agreed price and terms and escrow has been opened, the status of the active listing will be changed into contingent.  At this point, there are still at least one condition that allow the buyer or seller to cancel the contract without paying any penalty.

However, if every term has been settled and it is only a matter of waiting for the funding to arrive (usually from the lender) or waiting for the seller to move out (when on the contract stated that the property has to be delivered vacant), or something else need to be done, then the contingent property is changed into pending.  Once the property is at a pening status, anybody who wants to back out or cancel the contract will incur some fee to pay.  Usually, it will be the initial deposit up to 3% of the total purchase price unless otherwise stated.

Many consumers may already aware that on top of the “old” homebuyer tax credit, there is the new “$10,000″ award for California homebuyers.  However, I always encountered my clients ask the following questions that  I think you may like to know as well.

1.  MY FRIEND HAS JUST PURCHASED A HOUSE IN CALIFORNIA BUT S/HE CAN ONLY GET $7,000 CREDIT AND NOT $8,000 CREDIT, WHAT COULD BE THE REASON?

Answer:  Your friend must have fulfilled all criterior for the first time homebuyer’s credit such as purchasing his/her first home as principal resident.  However, I bet the house price has not exceed $700,000 because the amount of tax credit is 10% of purchase price not to exceed $8,000 for First-Time Homebuyers or $6,500 for Long-Term Residents.

2.  MY FRIEND IS A FIRST TIME HOMEBUYER BUT IS REJECTED TO RECEIVE ANY FIRST TIME HOMEBUYER TAX CREDIT, WHY?

Answer:  If your friend earns over $145,000 per year as single or $245,000 as joint tax filers, s/he is not entitled to such credits.

3.  I WANTED TO BUY A HOUSE NOW BUT WOULD IT BE BETTER IF I WAIT UNTIL MAY SO THAT I CAN GET THE NEW CALIFORNIA TAX CREDIT?

Answer:  That will be your choice.  If you enter a written binding contract by April 30,2010 and close it before June 30, 2010, you will be able to get 10% of purchase price not to exceed $8,000 as a First Time Homebuyer or $6,500 for Long-Term Residents.  However, if you wait until May 1, 2010 to enter into a written binding contract, you will be eligible to 5% of purchase price, not to exceed $10,000.  You may consider this depend on the purchase price of your property.  Of course, you will have to fullfill all other criteria. 

4.  CAN YOU TELL ME MORE ABOUT THE ‘NEW’ HOMEBUYER TAX CREDIT?

Answer:  The new California law offers up to $10,000 for firsttime homebuyers or buyers of properties that have never been occupied.  Here is the summary:

Amount of Tax Credit:   5% of purchase price, not to exceed $10,000

Date of purchase:  From May 1, 2010 to July 31, 2011, but an enforceale contract must be executed by December 31, 2010.

Principal Residence:  Yes

Type f Property:  Single-family residence

Eligibility:  First-Time Homebuyer.  Up to $10,000 if the buyer (or buyer’s spouse if any) has not owned a principal residence during the three-year period before date of purchase. Or Never-Occupied Property: Up to $10,000 for a principal residence if the property has never been previously occupied as certified by the seller.

Income Restriction:  No

Maximum Purchase Price:  Not applicable

Repayment:  No repayment required if the buyer owns and occupies the property for at least 2 years immediately following the purchase.

Multiple Buyers (not married to each other):  Tax credit must be allocated between eligible taxpayers based on their percentage of ownership.

Maximum Credit for all taxpayers:  $100 million for first-time homebuyers and $100 million for never-occupied properties, both on a first-come first-served basis.  (It means it will fade out if a lot of new homebuyers applied and awarded).

When to Claim:  1/3 of total tax credit may be claimed each year for 3 successive years.

How to File:  Submit application to the FTB to obtain Certificate of Allocation.  The FTB may prescribe additonal rules and procedures to carry out this law.

Other Restrictions:  Cannot be an acquisition from related persons as defined; buyer or spouse must be 18 years old; buyer cannot be another taxpayer’s dependent; credit is allowed for only one qualified principal residence, and credit allowed cannot be a business credit under Cal. Tax & Rev. Code 17039.2

More Information:  FTB web site at http://www.ftb.ca.gov/individuals/New Home Credits.html.

5. WHO MAY BENEFIT THE MOST FROM THIS NEW HOMEBUYER TAX CREDIT?

Answer:  In my opinion, if you are the California taxpayers who earns more than $145,000 per year and is interested to buy a never-occupied single family house in CALIFORNIA, this might be your only chance to earn this NEW credit.

6. I LIKE NEWER HOME BUT WITH THE CURRENT AVAILABLE MARKET PRICE IN THE AREA I LIKE, I CAN ONLY AFFORD TO BUY CONDOMINIUM OR TOWNHOUSE, WHAT IS YOUR ADVICE?

Answer: Well, in that case, you should hurry because under the OLD tax credit regulations, not only Single Family Houses, but condominium, townhouse, manufactured home, apartment cooperative, houseboat, housetrailer, or other type of property located in the U.S. are all included.

7.  I SOLD MY PRINCIPAL RESIDENTS LAST YEAR, CAN I STILL BE ELGIBLE TO GET THE TAX CREDIT IF I BUY NOW?

Answer:  Again, you have to hurry too.  If you have lived in your previous house for 5 years out of the last 8 years, you are classified as Long-Time Resident and can get up to a maximum of $6,500 credit under the OLD homebuyer credit application.

8.  WILL I GET CASH FROM THE TAX CREDIT I APPLIED?

Answer:  YES under the OLD CREDIT.  Any amount of the tax credit not used to reduce the tax owed may be added to the taxpayer’s tax refund check. 

No under the NEW CALIFORNIA CREDIT

Sources:  http://www.car.org/legal/legal-questions-answers/2010

Thank you for your visit and please let me know if you want to receive a summary of the comparison of the old and new homebuyer’s credit.