Important Changes in California Lease Laws Coming in 2020

Leasing a property in California is probably harder than in any other state because of all the tenant right laws and the constant changing rules about how much notice has to be given to do things such as increase rent, end a tenancy, as well as how much you can charge for certain things, what limitations can and cannot be placed on a tenant, who falls under what protected classes and how those classes have to be treated differently (e.g., if someone is active military, you cannot charge them more than one month rent as a security deposit). A huge change for landlords is that they cannot advertise “No Section 8” which was previous okay because that is now considered discriminatory.

2020 brings on a bunch of changes Landlords and Tenants in California need to know about. Click the link next to the thumbnail pic below to see the overview of the up-coming changes for 2020 provided by the California Association of Realtors. If you are a landlord, make sure you take time to read over this information.

If you or someone you know is interested in buying or selling a property, I’d be happy to help! Just click the contact me button and submit your contact info or give me a call.

Robin Watson-Bird, Ph.D., Broker/Owner

Realty World-No Pressure Realty

License #01387964

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Quick Overview-Miscellaneous Landlord Tenant Laws for 2020 Overview

 

 

 

 

It is Now Legal to Short Sale Your Home, Lease it Back, and then Buy it Later at Today’s Low Price!!

Ever since I have been helping homeowners short sale their properties since 2007, I have been asked two common questions:

 

1) Can I stay and lease back my house from the new owner?

2) Can I short sale the property to myself or buy it back later after I do a short sale?

 

Until recently, many banks would not allow a seller to remain in a property as a renter after they completed a short sale and none would allow an agreement that would arrange up front for the seller to potentially buy back the home at the cheaper price.

 

Now, those two things are legally possible if the seller/borrower qualifies and their bank agrees!

 

Making Home Affordable Program – Administrative Clarifications Supplemental Directive 11-02 March 30, 2011 Page 8 states the following:

 

Supplemental Directive 11-02 March 30, 2011 Page 8 states the following:

 

Sales to Non-Profit Housing Organizations

Section 7.3 of Chapter IV of the Handbook requires that a short sale be an arm’s length

transaction. This Supplemental Directive amends this restriction to allow servicers the discretion to approve sales to non-profit organizations with the stated purpose that the property will be rented or resold to the borrower, so long as all other HAFA program requirements are met.

 

Servicers offering programs of this type must include program descriptions and conditions in their HAFA Policy. Servicers must retain in the servicing system and/or mortgage file the evidence provided during the HAFA evaluation demonstrating that the organization was a nonprofit organization.

 

Under these circumstances, servicers must remove certain of the applicable “arm’s length

transaction” requirements from the SSA, the Request for Approval of Short Sale and the

Alternative RASS. These forms will be updated to reference these changes and will be available on www.HMPadmin.com.

 

Not All Agents Are Certified to Assist Homeowners With This Process!

 

In order to provide the service to homeowners, agents have to be certified with one or more of the approved NonProfit organizations. I am one of the very few agents in the East Bay, Tri-Valley area who are certified with one or more of the approved NonProfit Organizations to offer this program to homeowners. Fresh Start is one of those programs.

 

 

Like with any program, not every homeowner will qualify, but if you would like more information about the HAFA Short Sale Lease back Program and to see if you may qualify, feel free to give me a call at 925-577-8692, send me a message through this site.

 

My goal is to always help homeowners know what all their options are in order to avoid foreclosure so  they can make the best choice for their situation and family. I love helping people find a way to stay in their home when that is what they really want to do and I look forward to being able to help people do just that with this program!

Should I Short Sale My House in Livermore, Danville, Pleasanton or the Tri-Valley Bay Area Now or Wait?

Should I Short Sale My House in Livermore, Danville, Pleasanton or the Tri-Valley Bay Area Now or Wait?

I have had many people ask me whether they should short sale their house in Livermore, Danville, San Ramon, Dublin, the Bay Area, Tri-Valley Area of California now or wait until the market improves and do a traditional sale.

Well, based on the real estate trends, mortgage lending history, and economic condition of the state, it is probably going to take another 7-10 years for the market to begin to turn around and recoup some of the home value you have lost, and there is no guarantee that in that time your home will even reach the price you paid or owe  if your purchased your refinanced home to get equity out between 2004 and 2007.

If you are in a bad situation and you owe more money on your home than it is worth and you can no longer afford to make the payments on the property, or you have another reason that you need to move out the home or sell it (for example, job relocation, medical condition that does not allow you to climb stairs and you own a two story home, etc.—lots of many possible scenarios), then you will want to get your home listed ASAP so you can get an offer, the short sale processed and the transaction closed BEFORE the end of 2012.

The typical lender takes 30-90 days to process a short sale once you have an offer which could come right away or take 30+ days to get. Then there is a 30 day escrow period for the buyer to complete their inspections, get their loan in place and close the transaction. So, on an average transaction, you are looking at 3-6 months from start to finish. Depending upon the type and price range of property you have, the desirability of your neighborhood, and who your lenders are, it could take you a year or more to get through the short sale process, so do not wait.

What’s the rush?

The reason you will want to list right away rather than wait is because

The Mortgage Forgiveness Debt Relief Act and Debt Cancellation ends at the end of 2012!

According to the IRS website, http://www.irs.gov/individuals/article/0,,id=179414,00.html

 “If you owe a debt to someone else and they cancel or forgive that debt, the canceled amount may be taxable.”

“The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence.”

 This means that if you short sale your primary residence, then you should not have to pay taxes on the forgiven debt!

This provision applies to debt forgiven in calendar years 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exclusion ($1 million if married filing separately). The exclusion does not apply if the discharge is due to services performed for the lender or any other reason not directly related to a decline in the home’s value or the taxpayer’s financial condition.”

Since the Act is set to expire at the end of 2012 and so far, I have not heard talks of extending it, probably due to the fact that the country needs the tax money, NOW is the time to short sale if that is the route you are considering taking. If you miss the end of the 2012 calendar year deadline and they do not extend the act, you may end up being responsible for paying taxes on all of the forgiven debt on your home if you short sale later or even let it foreclose. Yes, if you let you home foreclose, you may still owe taxes on the property.

Most people cannot afford to pay taxes on an extra $100,000 or more of  “income,” especially when that income is only on paper via the 1099 that the lender will issue to you and not actual money deposited into your account.

I have been listing and processing short sales for 5 years, before most agents even knew what they were, and have successfully closed so many short sales that I have earned the designation of Short Sale Genius Elite Master. I am also HAFA certified so that I can assist people who qualify for the HAFA program short sale their homes and receive up to $3,000 to assist with moving costs.

I have been doing short sales so long that I have already started helping past short sale clients purchase new homes!

I provide free short sale consultations for people who are considering short selling their home or investment properties. Whether you just want to learn more about what a short sale is, what some of the alternatives you may have to doing a short sale, or if you are ready for us to meet for me to list your home, I would be happy to talk to you. Feel free to give me a call at 925-289-1432 or send me a message through my blog and I will be happy to discuss your situation with you.

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California Short Sales Have to Be Non-Deficient

In case you did not hear the news over the summer, there is Great news for Livermore, Bay Area and California Homeowners who are underwater and need to short sale their home: Short Sales in California Now Have to Be Non-Deficient! In layman terms, the banks can no longer come after you for any additional funds once you closed an approved short sale in California.

There are now California two laws in place regarding short sales and how they have to be non-deficient in California now: SB 931 (has to do with the first liens having to be non-deficient) and SB 458 (as of July 15 of this year, second lien holders cannot pursue a deficiency after short sale either). Below I included the link to a video that one of my coaches did related to SB 931 to explain the law so you can check it out for yourself. If your loans are not original purchase money loans and your second is an equity line, I highly recommend that you confirm it with an attorney since refinanced loand and equity lines have historically been treated a little differently; hopefully, the new laws will take care of that!

He is the link to the video:
http://theshortsalegenius.com/what-is-sb-931-and-how-does-it-impact-second-liens-2nd-mortgages/2011/01/07/

Home Buyer Tax Credit Extension Stuck in the House

The Senate has passed a bill to give homebuyers another three months to close on their homes and receive tax credits up to $8,000. The Tax Extenders Bill would apply to homebuyers who met the April 30, 2010 deadline with a signed contract to purchase a new or existing primary residence. The amendment would extend the deadline to September 30, 2010 for homebuyers to close on their real estate transaction. The previous deadline was June 30, 2010. The bill is now sitting in the House of Representatives, where it is expected to pass should it actually get voted on in time.

The National Association of Realtors estimates that as many as 180,000 homebuyers have qualified for the tax credit and met the contract deadline of April 30, 2010, but might not be able to close their transaction by the June 30, 2010 deadline due to the sheer volume of loan applications in the pipeline.

Many of the short sale lenders out there that I have been working with are telling me that they are having delays in getting their approvals out because of the number of folks who are wanting to close by June 30th.

Many buyers are rushing trying to close escrow as quickly as possible…sometimes foregoing inspections on the property. I highly recommend that all buyers due their due diligence and take the time to inspect the property they are buying because there could be something worng with the property that may actually cost you more than the tax credit that you should know about.

Some loan agents out there are trying to speed the process up by whatever means they can to help their clients meet the deadline. Some things are good, others not so much in my book. Buyers beware.

The above content is for informational purposes only and should not be used as a substitute for consultation with a tax advisor.

The great guys at TBWSDaily.com have a great daily video about this in their June 24, 2010 archive if you want to check it out.

http://www.thinkbigworksmall.com/mypage/archive/1/51378

You can subscribe to their free Daily video updates to keep you up on what is going on out there in the real estate and mortgage world. If you ever need a pick me up during the day or first thing in the morning, watching their high energy video updates will wake you up and get your blood pumping. I really like what they have to offer and you cannot beat the price!