Did you know that you may qualify to lower your property taxes? Below is (1) an explanation of Proposition 8 (2) a summary in plain language of what it means (3) how to take action if necessary.
In 1978, California voters passed Proposition 8, a constitutional amendment that allows a temporary reduction in assessed value when a property suffers a decline-in-value. A decline-in-value occurs when the current market value of your property is less than the assessed value as of January 1. The assessed value is the value shown on your most recent property tax bill.
Basically what this means to you or someone you know is this; if you purchased a home between July 2004 and June 2007, then your home will be included in an upcoming Assessor's review to see if the value of your property is less than the assessed value. For example, if you paid $500,000 for your home and it is now worth $450,000 then you would pay taxes on the lower amount.
If you purchased your home before July 2004 you can submit an application to the Los Angeles County Tax Asssesor and request a review to lower your taxes.
I have the application if you or someone you know would like to apply. I will provide you with two comperables that you need to file for tax reduction. Oh, and don't worry, I provide this for free & there's no catch. This is just my way to give back to community.
If you own property other than a single family residence or condo, a Decline-In-Value application will be required for a review by the Assessor’s Office. An application is recommended if you believe the assessed value of the property shown on the 2008-09 tax bill is more than the fair market value as of January 1, 2009.
Call or email me if you have questions! I'm here to help.
My best,
Your Real Estate Consultant for Life
Igor Korosec
Email: BestHollywoodHomes@gmail.com
Phone: 310-499-1305
Best Real Estate News
Monday, January 26, 2009
IRS Speeds Lien Relief for Homeowners Trying to Refinance, Sell
Audio file: Tax Lien Relief
IR-2008-141, Dec. 16, 2008
WASHINGTON — The Internal Revenue Service today announced an expedited process that will make it easier for financially distressed homeowners to avoid having a federal tax lien block refinancing of mortgages or the sale of a home.
If taxpayers are looking to refinance or sell a home and there is a federal tax lien filed, there are options. Taxpayers or their representatives, such as their lenders, may request that the IRS make a tax lien secondary to the lien by the lending institution that is refinancing or restructuring a loan. Taxpayers or their representatives may request that the IRS discharge its claim if the home is being sold for less than the amount of the mortgage lien under certain circumstances.
The process to request a discharge or a subordination of a tax lien takes approximately 30 days after the submission of the completed application, but the IRS will work to speed those requests in wake of the economic downturn.
“We don’t want the IRS to be a barrier to people saving or selling their homes. We want to raise awareness of these lien options and to speed our decision-making process so people can refinance their mortgages or sell their homes,” said Doug Shulman, IRS commissioner.
“We realize these are difficult times for many Americans,” Shulman said. “We will ensure we have the resources in place to resolve these issues quickly and homeowners can complete their transactions.”
Filing a Notice of Federal Tax Lien is a formal process by which the government makes a legal claim to property as security or payment for a tax debt. It serves as a public notice to other creditors that the government has a claim on the property.
In some cases, a federal tax lien can be made secondary to another lien, such as a lending institution’s, if the IRS determines that taking a secondary position ultimately will help with collection of the tax debt. That process is called subordination. Taxpayers or their representatives may apply for a subordination of a federal tax lien if they are refinancing or restructuring their mortgage. Without lien subordination, taxpayers may be unable to borrow funds or reduce their payments. Lending institutions generally want their lien to have priority on the home being used as collateral.
To apply for a certificate of lien subordination, people must follow directions in Publication 784, How to Prepare an Application for a Certificate of Subordination of a Federal Tax Lien. Again, there is no form but there must be a typed letter of request and certain documentation. The request should be mailed to one of 40 Collection Advisory Groups nationwide. See Publication 4235, Collection Advisory Group Addresses, for address information.
Taxpayers or their representatives may apply for a certificate of discharge of a tax lien if they are giving up ownership of the property, such as selling the property, at an amount less than the mortgage lien if the mortgage lien is senior to the tax lien. The IRS may also issue a certificate of discharge in other circumstances if the taxpayer has sufficient equity in other assets, can substitute other assets, or is able to pay the IRS its equity in the property. Without a tax lien discharge, the taxpayer may be unable to complete the home ownership change and the ownership title will remain clouded.
To apply for a tax lien discharge, applicants must follow directions in Publication 783, Instructions on How to Apply for a Certificate of Discharge of a Federal Tax Lien. There is no form but there must be a typed letter of request and certain documentation. The request should be mailed to one of 40 Collection Advisory Groups nationwide. See Publication 4235 for address information.
The IRS also urges people to contact the agency’s Collection Advisory Group early in the home sale or refinancing process so that it can begin work on their requests. People sometimes delay informing lenders of the tax liens, which only serves to delay the transaction.
Currently, there are more than 1 million federal tax liens outstanding tied to both real and personal property. The IRS issues more than 600,000 federal tax lien notices annually.
IR-2008-141, Dec. 16, 2008
WASHINGTON — The Internal Revenue Service today announced an expedited process that will make it easier for financially distressed homeowners to avoid having a federal tax lien block refinancing of mortgages or the sale of a home.
If taxpayers are looking to refinance or sell a home and there is a federal tax lien filed, there are options. Taxpayers or their representatives, such as their lenders, may request that the IRS make a tax lien secondary to the lien by the lending institution that is refinancing or restructuring a loan. Taxpayers or their representatives may request that the IRS discharge its claim if the home is being sold for less than the amount of the mortgage lien under certain circumstances.
The process to request a discharge or a subordination of a tax lien takes approximately 30 days after the submission of the completed application, but the IRS will work to speed those requests in wake of the economic downturn.
“We don’t want the IRS to be a barrier to people saving or selling their homes. We want to raise awareness of these lien options and to speed our decision-making process so people can refinance their mortgages or sell their homes,” said Doug Shulman, IRS commissioner.
“We realize these are difficult times for many Americans,” Shulman said. “We will ensure we have the resources in place to resolve these issues quickly and homeowners can complete their transactions.”
Filing a Notice of Federal Tax Lien is a formal process by which the government makes a legal claim to property as security or payment for a tax debt. It serves as a public notice to other creditors that the government has a claim on the property.
In some cases, a federal tax lien can be made secondary to another lien, such as a lending institution’s, if the IRS determines that taking a secondary position ultimately will help with collection of the tax debt. That process is called subordination. Taxpayers or their representatives may apply for a subordination of a federal tax lien if they are refinancing or restructuring their mortgage. Without lien subordination, taxpayers may be unable to borrow funds or reduce their payments. Lending institutions generally want their lien to have priority on the home being used as collateral.
To apply for a certificate of lien subordination, people must follow directions in Publication 784, How to Prepare an Application for a Certificate of Subordination of a Federal Tax Lien. Again, there is no form but there must be a typed letter of request and certain documentation. The request should be mailed to one of 40 Collection Advisory Groups nationwide. See Publication 4235, Collection Advisory Group Addresses, for address information.
Taxpayers or their representatives may apply for a certificate of discharge of a tax lien if they are giving up ownership of the property, such as selling the property, at an amount less than the mortgage lien if the mortgage lien is senior to the tax lien. The IRS may also issue a certificate of discharge in other circumstances if the taxpayer has sufficient equity in other assets, can substitute other assets, or is able to pay the IRS its equity in the property. Without a tax lien discharge, the taxpayer may be unable to complete the home ownership change and the ownership title will remain clouded.
To apply for a tax lien discharge, applicants must follow directions in Publication 783, Instructions on How to Apply for a Certificate of Discharge of a Federal Tax Lien. There is no form but there must be a typed letter of request and certain documentation. The request should be mailed to one of 40 Collection Advisory Groups nationwide. See Publication 4235 for address information.
The IRS also urges people to contact the agency’s Collection Advisory Group early in the home sale or refinancing process so that it can begin work on their requests. People sometimes delay informing lenders of the tax liens, which only serves to delay the transaction.
Currently, there are more than 1 million federal tax liens outstanding tied to both real and personal property. The IRS issues more than 600,000 federal tax lien notices annually.
IRS to give break to distressed homeowners
The Internal Revenue Service (IRS) last week announced it is “subordinating” federal tax liens and allowing primary mortgage holders to take precedence when a mortgage is refinanced or the home is sold. Homeowners with federal tax liens tied to their properties may find it difficult to refinance or sell. The new IRS program allows homeowners to refinance or sell a home without first having to pay any federal tax liens. The IRS is not forgiving the debt though, and homeowners must pay any back taxes owed.
To read the full story, please click here:
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/12/17/BUL814PEF5.DTL
To read the full story, please click here:
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/12/17/BUL814PEF5.DTL
Will loan limits rise?
Congressional leaders from both parties have been lobbying President-elect Obama to increase the limits of conforming loans – mortgages eligible to be purchased by Government Sponsored Enterprises (GSEs), like Fannie Mae and Freddie Mac – in high cost areas from $625,500 to $729,750 as part of an economic stimulus package. Qualified borrowers with conforming loans receive the best interest rates, because many in the financial industry believe conforming loans carry less risk.
Last year, as part of the federal government’s economic stimulus package, the conforming loan limit was temporarily increased to $729,750 in high-cost areas. Beginning Jan. 1, 2009, the conforming loan limit was lowered to its original level of $625,500 for high-cost areas.
In California, the new conforming loan limits for metropolitan areas range from $474,950 in the Sacramento-Arden-Arcade-Roseville metropolitan area, covering El Dorado, Placer, Sacramento, and Yolo counties to $625,500 in the Los Angeles-Long Beach-Santa Ana metropolitan area.
To read the full story, please click here:
http://www.nytimes.com/2009/01/11/realestate/11mort.html?_r=1
Last year, as part of the federal government’s economic stimulus package, the conforming loan limit was temporarily increased to $729,750 in high-cost areas. Beginning Jan. 1, 2009, the conforming loan limit was lowered to its original level of $625,500 for high-cost areas.
In California, the new conforming loan limits for metropolitan areas range from $474,950 in the Sacramento-Arden-Arcade-Roseville metropolitan area, covering El Dorado, Placer, Sacramento, and Yolo counties to $625,500 in the Los Angeles-Long Beach-Santa Ana metropolitan area.
To read the full story, please click here:
http://www.nytimes.com/2009/01/11/realestate/11mort.html?_r=1
Clean up your credit
With financial institutions, auto dealers, and credit card companies more cautious about lending than in previous years, consumers are advised to closely monitor their credit history and FICO score to ensure they receive the best interest rates possible.
• Consumers considering the purchase of a home should first get their credit and finances in order. Reducing spending, limiting credit card balances to no more than 25 percent of the available balance, and monitoring credit reports are highly recommended by most financial experts. Even borrowers with less than ideal credit scores and credit histories still may qualify for a home loan. Some lenders will be more forgiving if the borrower has started meeting monthly debt obligations in the last six to 12 months. Consumers can view their credit reports from Experian, Equifax, and TransUnion by visiting www.annualcreditreport.com. The free credit reports will provide a borrower’s credit history, but not the credit score. The credit score can be purchased for approximately $10 from the credit reporting bureaus.
• Borrowers who already have received their free annual credit report can purchase a copy from www.myfico.com. The cost is approximately $16 for the score from one credit bureau, or $50 for all three.
• Good credit doesn’t mean simply paying bills on time; it also can mean job stability. Most lenders require borrowers to have worked for the same employer for at least one year, possibly longer before they will approve the home loan application. For self-employed individuals, most lenders will want at least two years of tax returns before approving a conventional loan.
• Many large financial institutions have been forced to write off high levels of credit card debt. As a result, borrowers are being required to have higher FICO scores than previously required. A year ago, a FICO score of 720 was considered excellent. By today’s standards, a credit score of 740 or higher likely will mean the borrower is approved, but not necessarily at the best interest rate possible, according to an executive with LowCards.com.
• Inaccuracies on a credit report can be disputed with each credit reporting agency. Typically, the process takes 30 to 45 days for the bureau to investigate the dispute. Although this process can be time-consuming, it is well worth the time and effort. Incorrect notations, such as an account that has gone to collection or a home in foreclosure, could cost the borrower 100 points or more on their credit score.
• Credit advisors recommend that borrowers pay their accounts in full each month, if possible. If that is not feasible, then borrowers should pay at least the minimum amount owed, and ensure the payments are made on time. Late payments will likely lower a credit score and could automatically result in a higher interest rate.
To read the full story, please click here:
http://www.washingtonpost.com/wp-dyn/content/article/2009/01/15/AR2009011501231.html
• Consumers considering the purchase of a home should first get their credit and finances in order. Reducing spending, limiting credit card balances to no more than 25 percent of the available balance, and monitoring credit reports are highly recommended by most financial experts. Even borrowers with less than ideal credit scores and credit histories still may qualify for a home loan. Some lenders will be more forgiving if the borrower has started meeting monthly debt obligations in the last six to 12 months. Consumers can view their credit reports from Experian, Equifax, and TransUnion by visiting www.annualcreditreport.com. The free credit reports will provide a borrower’s credit history, but not the credit score. The credit score can be purchased for approximately $10 from the credit reporting bureaus.
• Borrowers who already have received their free annual credit report can purchase a copy from www.myfico.com. The cost is approximately $16 for the score from one credit bureau, or $50 for all three.
• Good credit doesn’t mean simply paying bills on time; it also can mean job stability. Most lenders require borrowers to have worked for the same employer for at least one year, possibly longer before they will approve the home loan application. For self-employed individuals, most lenders will want at least two years of tax returns before approving a conventional loan.
• Many large financial institutions have been forced to write off high levels of credit card debt. As a result, borrowers are being required to have higher FICO scores than previously required. A year ago, a FICO score of 720 was considered excellent. By today’s standards, a credit score of 740 or higher likely will mean the borrower is approved, but not necessarily at the best interest rate possible, according to an executive with LowCards.com.
• Inaccuracies on a credit report can be disputed with each credit reporting agency. Typically, the process takes 30 to 45 days for the bureau to investigate the dispute. Although this process can be time-consuming, it is well worth the time and effort. Incorrect notations, such as an account that has gone to collection or a home in foreclosure, could cost the borrower 100 points or more on their credit score.
• Credit advisors recommend that borrowers pay their accounts in full each month, if possible. If that is not feasible, then borrowers should pay at least the minimum amount owed, and ensure the payments are made on time. Late payments will likely lower a credit score and could automatically result in a higher interest rate.
To read the full story, please click here:
http://www.washingtonpost.com/wp-dyn/content/article/2009/01/15/AR2009011501231.html
Multiple applications for mortgages
Anecdotal evidence suggests only 50 percent of borrowers applying to refinance are being approved, down from 60 to 70 percent during previous refinance cycles. Homeowners with FICO scores below 700 or with little equity in their homes likely will not qualify to refinance. To increase the likelihood of receiving approval, some borrowers are applying with multiple lenders.
Lenders can lose money on a loan locked in with investors if the borrower decides to go with a different lender. To discourage borrowers from applying with multiple lenders, some lenders are charging up-front deposits.
To read the full story, please click here:
http://www.washingtonpost.com/wp-dyn/content/article/2009/01/15/AR2009011504100.html?hpid=sec-business
Lenders can lose money on a loan locked in with investors if the borrower decides to go with a different lender. To discourage borrowers from applying with multiple lenders, some lenders are charging up-front deposits.
To read the full story, please click here:
http://www.washingtonpost.com/wp-dyn/content/article/2009/01/15/AR2009011504100.html?hpid=sec-business
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