Lee's Summit MO real estate listings and homes for sale, home buying, home selling information – AAA Mortgage LLC

AAA Blog

June 29th, 2010 5:01 PM

Just when you thought rates could not possibly go any lower SURPRISE they do! Now it is official we are not at historical lows, we are at THE HISTORICAL LOW. Will it go lower? I have turned in my crystal ball for a Magic 8 Ball. Who knows? and if you do your lying! The senario under which these low rates have come are nothing short of astonishing. It has taken a full global colapse to bring us to our present situation.

What is bad the for economy may be good for your pocketbook. Now is the time to look at your mortgage and make your final chess move. You may very well be able to shorten your term or lower your monthly expenses. If you are looking to buy you have a tremendous buying power at these rates. Don't wait or wait? Who knows either way you can't loose.

Posted by Jason Dillabough on June 29th, 2010 5:01 PMPost a Comment (0)

Go Fish

March 17th, 2010 3:13 PM

Last night I was playing the game "Fish" with my son Kannon (you know the game where someone asks if you have a 7 in your hand so they can match it up with theirs to make a set)... man, it's been a long time since I've played that game. We had a blast! As I was heading to work this morning I was thinking of you (hence the reason you're getting this email) and I wanted to see if you could help me play a game of "Go Fish" for what is happening right now in the mortgage market.

The truth is that I've had to pinch myself a few times the last week to make sure that what was going on is real... rates have dropped to the lowest they've been in 46 years... heck, that's longer than some of us have been alive. this may be a perfect opportunity for someone you care about (or maybe even yourself) to lock in on some incredible rates.

So right now I'm looking for someone who currently has a loan of $417,000 or less and a current interest rate of $5 1/2 percent or higher. this person should have at least 20% equity in their home, have excellent credit, as well as be able to document their income.

If you know someone who fits that description, please give me a call right now or email me so we can discuss the best way to get us into conversation... if not, drop me a line saying, "Sorry Jason, Go Fish"!

jdillabough@aaa1loan.com

Posted by Jason Dillabough on March 17th, 2010 3:13 PMPost a Comment (0)

First Time Homebuyer Tax Credit

March 16th, 2010 4:52 PM

President Barack Obama has signed legislation extending the $8,000 first-time-homebuyer tax credit beyond its scheduled Nov. 30 expiration and creating a $6,500 credit for longtime homeowners who buy new homes. With thousands of dollars at stake, it's not surprising that potential homebuyers have lots of questions. We have the answers.

How does the extension work?

It's simple: The old credit was scheduled to expire Nov. 30, so folks who hadn't already signed a contract faced a daunting task to get a deal closed by the deadline. Some real-estate agents were writing provisions into contracts making the purchase contingent on the deals closing in time for buyers to get the credit.

Under the new law, the credits are available to qualifying buyers who sign a binding contract by April 30, 2010, and who close by June 30, 2010. The two-month period should offer plenty of time for last-minute buyers to get to the closing table.

No. There are a few differences that apply to deals closed after Nov. 6, the day Obama signed the bill. First, the similarities:

You're considered a first-time buyer if you have not owned a home for at least three years before the date you settle on your new home.
A credit is available only for the home you live in. It's not available for rental properties or vacation homes.
For first-time buyers, the credit is 10% of the purchase price of the home, up to $8,000. Therefore, if your house costs $80,000 or more, you can qualify for the maximum tax credit.
The credit does not have to be repaid, as long as you live in your house for at least three years. If you sell or move out before three years, you have to repay the money as extra tax on your tax return for the year you sell or move. (The payback can't exceed the amount of profit you make on the sale, though.)

Now for the key differences:

Longtime homeowners can get a credit now, too, but it tops out at $6,500.
You don't get a credit if the house you buy costs more than $800,000. (There was no price cap for deals closed before Nov. 7.)
The new law increases how much buyers can earn and still claim a credit. For deals closed before Nov. 7, the right to the credit gradually disappeared as adjusted gross income rose between $75,000 and $95,000 on single returns and between $150,000 and $170,000 for married couples filing joint tax returns. (Adjusted gross income is basically your income before you subtract your personal and dependent exemptions and your standard or itemized deductions.)
Now the phaseout zones are $125,000 to $145,000 for singles and $225,000 to $245,000 for married couples.
When we signed our contract to buy our first home in October, we were kind of bummed because our $190,000 income meant we made too much to qualify for the credit. We won't close until mid-November. Do we get a credit now?

You're in luck. The new, higher income limits apply to deals closed after Nov. 6. Enjoy your windfall.

How does the new $6,500 credit work?

This credit is available to qualifying buyers who sign a binding contract by April 30, 2010, and who close on a new home between Nov. 7, 2009, and June 30, 2010. To qualify, you must have continuously owned and lived in a home for at least five of the eight years leading up to the purchase of a new home.

If you have owned and lived in your current home for at least five years, for example, you can qualify. If you bought the home you're living in now less than five years ago, however, you won't qualify.

The credit is 10% of the purchase price, up to $6,500. As with the first-time-buyer credit, this one is available only for the purchase of a principal residence, not a vacation home or rental property. And if you sell the place or move out within three years, you have to pay back the credit on your tax return for the year you sell or move. Homes that cost more than $800,000 are ineligible for the credit.

Income-eligibility rules are the same as for the first-time-buyer credit. The right to claim the credit disappears as adjusted gross income rises between $125,000 and $145,000 on a single return and between $225,000 and $245,000 for married couples filing joint returns.
It looks as if we qualify for the move-up credit, but we signed a contract to buy our home before the president signed the new law. We're going to close at the end of November. Do we get the money?

As long as you close after Nov. 6, you can qualify for the credit. The new credit is often referred to as a move-up credit.

We plan to sell our home and retire to a smaller place. Is the $6,500 credit available only if you buy a more expensive home?

Don't worry. "Move-up" is a misnomer often used to distinguish this from the first-time-buyer credit. It's OK to downsize.

There are no rules about the cost of the house you sell or the home you buy, except that the new house can't cost more than $800,000.

How do I claim a credit?

The procedure is the same for both the first-time-buyer and longtime-resident credits. Once you close on a qualifying house, you claim a credit on your federal tax return. If you close in 2009, you can choose whether to claim the credit on the 2009 return you file next spring or on an amended 2008 return. Choosing the amended return would bring you a refund of the full credit amount. If you claim the credit on your 2009 return, it will reduce your tax bill for the year by the amount of your credit.

This is what's called a refundable credit, so if the credit reduces your tax bill below zero, you'll get the difference as a tax refund. If you close on a home in 2010, you can claim the credit on either your 2009 or 2010 return. Sooner rather than later is the choice to make.

You'll need to file a Form 5405 to claim the credit and include a copy of your settlement statement (such as the HUD 1 form) to prove that you bought the house. The settlement statement was not required for deals that closed before Nov. 7.

Not on the upper end. But as part of an anti-fraud effort, neither homebuyer credit is available to taxpayers who were under age 18 at the time of the purchase. The discovery that taxpayers as young as 4 years old were claiming the first-time-buyer credit cast suspicion that some hanky-panky was going on. Married couples can qualify for the credit as long as one spouse is at least 18 at the time the deal is closed.

The new law also bans anyone who is claimed as a dependent on someone else's return from claiming a homebuyer credit.

Can I claim the credit for the purchase of a vacation home? How would the Internal Revenue Service know whether I was living there full time?

The credits are available only for the purchase of a principal residence. As for how the IRS might know a new house is a vacation property, the fact that your tax return was filed from an address that's different from the address of the new property (which would be shown on the settlement sheet) might raise some eyebrows. If the IRS concludes that a claim is fraudulent, it can impose a 75% penalty, which would cost $6,000 on an $8,000 credit claimed for a vacation home.

We bought a home Oct. 15, 2003, and sold it in August 2008. So we owned the home for slightly less than five years. We are renting an apartment now and are looking to buy a home. Do we qualify for the first-time-homebuyer tax credit as amended, assuming that we pass the necessary income tests?

Sorry, but based on the facts you present, you're out of luck. To qualify for the first-time-buyer credit, you cannot have owned a home within the previous three years. You sold your previous home just 15 months ago. And it appears that your ownership of that home was a few months shy of five years, the minimum period of continuous ownership required for you to qualify for the longtime-resident credit.

Can I qualify for both the first-time-buyer and longtime-resident credits?

No. You can claim only one or the other.

My husband's parents are offering to sell us their vacation home as our first home. Would we qualify for the first-time-buyer credit?

Not anymore. The original first-time-buyer credit law disallowed the credit if the home sale was between related parties, but there was a loophole for the situation you describe. Since you are not related to your husband's parents, except by marriage, you could have qualified for the credit, assuming you bought the home jointly. The new law, however, puts the kibosh on that, effective for purchases after Nov. 6, 2009.

This article was reported by Kevin McCormally for Kiplinger's Personal Finance Magazine.

Published Nov. 12,

Posted by Jason Dillabough on March 16th, 2010 4:52 PMPost a Comment (0)

Important Homebuyer Dates

March 15th, 2010 4:09 PM

Important Dates Coming Up

There are some important dates coming up. The first is April 1st. The Fed is suspending its purchase of Mortgage Backed Securities as of March 31st. What does this mean? At this time the Fed is buying 2/3rds of all mortgages. With the absense of the largest buyer interest rates will have to rise to entice new investors. This is not an April fools joke, or perhaps it is (Not Funny Federal Reserve). This will certainly be a jab to the already shakey housing market. Top Government officials are hoping for no more than a .25% to .75% rate increase. According to officials this would be an acceptable shift.

If you are looking to buy or refinance in the short term it is advisable to lock in before the market shifts. If you are wondering when we hit the bottom, here you go!

The 2nd key date is April 30th. In oder to take advantage of the 1st time homebuyer tax credit, you must be under contract by April 30th. Don't expect an extension. It looks like this is it. Please get out now, as the deadline approaches offers will become more competitive as folks scramble to finalize their contracts. Stay ahead of the game and good luck!

Posted by Jason Dillabough on March 15th, 2010 4:09 PMPost a Comment (0)

What is your best rate?

November 16th, 2009 10:43 AM

I get calls all the time that ask for my best rate. I warn the caller that the rate that I quote is a thirty year fixed rate with no points. If you just call and ask for the rate you don't know what you are getting.

Many national lenders quote with one point. There is nothing wrong with that, except that you are not comparing "apples to apples".

So when you shop for your "best rate", ask: Is this a 30 year fixed? Are there origination points added? Could you send me a Truth In Lending form?

Remember, asking for the best rate is like asking how much is a bag of groceries. Unless you know what's in the bag, you can't compare!

Posted by Bob Euler on November 16th, 2009 10:43 AMPost a Comment (0)

Why should I use a Broker?

November 10th, 2009 10:51 AM

Should you use a broker? It costs more to use one. Right? My bank is cheaper! Not so fast....there is some fact and some myth. The mortgage broker was born as the banks appetite to lend extended beyond its capacity to create new business and do so cost effectively. To put thousands of agents on salary to originate loans was not an effective game plan. The mortgage broker could find business for the bank and work as a subcontractor to expand the banks lending platform. The bank in term would share the profit generated by the transaction. This freedom allowed the broker to structure a small business model that had the ability to undercut the retail rate structure of the bank. It is a fact that mortgage brokers have the power to be cheaper than the bank. The problem is that not all mortgage brokers are created equal and many chose to charge beyond the banks fees. It is important that you find a mortgage broker with a business model that competes with the banks.

"My closing costs are less at the bank". This is often true. However, the interest rate is often higher at the bank. If you look a few months down the road you will find that the monthly savings will quickly offset any additional expense that you may realize initially.

I have often said that having a mortgage broker is like having an attorney when you go to court. There are many rules and regulations that govern the lending markets. You need someone that can guide you through the process and rules to insure the best result. You can go to court alone and face the judge, but it always feels better to have someone next to you that knows the system.

Posted by Jason Dillabough on November 10th, 2009 10:51 AMPost a Comment (0)

Who Likes Change?

October 30th, 2009 1:58 PM

When I started in the mortgage business, one thing I liked was that there was always something new to learn. The last two years have made me question that.

The mortgage business has changed, those changes changed and then they changed again. If you have an old phone book around look at who was doing mortgage loans three years ago and how many of them are still around.

My point is be careful who you do business with. All the loan officers at AAA Mortgage have been in the business over ten years. If someone calls you trying to sell you something, ask about their experience. If they tell the truth, you will find you are most likely talking to someone who has been in the business less than one year.

Experience is only part of what makes a good loan officer, but if they have been in the business over five years you know this person understands some of the changes that will make a difference to you.

Bob Euler

Posted by Bob Euler on October 30th, 2009 1:58 PMPost a Comment (0)

The Truth about the NO PAYMENT MORTGAGE!

April 29th, 2008 4:39 PM

I have seen a lot of things in my time. Interest only Mortgages, 50 year mortgages, even 125% Mortgages. I thought I had seen it all, and along comes the 1 year payment free mortgage. How is this possible? I asked myself just this question as I listened to the radio with great interest. After all I have been arranging mortgages for 10 years and have never heard of such a mortgage. I asked every bank and lending institution that I could think of and each one shrugged their shoulders and looked at me with a blank stare.

I would think a product with this kind of draw would be available on each and every street corner. I decided to investigate. Believe it or not it took a good deal of investigation to glean even a small amount of information.

After many calls and countless articles I have determined that the old adage that "if it is too good to be true..." is safely intact. Yes, the wonderful payment free loan is just another gimmick. A slight of hand worthy of a magician. Here's how it works:

Your loan officer will inform you that you qualify for a payment free mortgage for 3 months, 6 months, 1 year. Your interest rate is the same either way and your loan will be paid off in 30 years as agreed as is the case with any 30 year fixed mortgage. Wow! Sounds great! (right?) Wrong! Well it is too much to assume that the bank is kind enough to forego payments for a year. The truth is they don't have to. Your loan officer has set up an escrow account at your expense using your equity to make payments on your behalf for the specified time. Yes, someone else will use your money to make payments. Usually at a substantial management fee.

The payment free loan is nothing more than a preset accounting service. Since you are taking money out of your equity to make the payments you are subject to fees associated with cash-out loans.

I have to admit it got my interest. I am sure it makes the phone ring for the companies advertising such a product. I just can't help wondering what loan officer in good conscience could sell this bait and switch. Perhaps the same ones that worked to put the mortgage market in the mess its in today. Don't Be Fooled! If you want an honest opinion or voice your displeasure. Contact Jason at (816) 272-5550.

Posted by Jason Dillabough on April 29th, 2008 4:39 PMPost a Comment (0)

What's Up is Down (Interest Rates)

January 18th, 2008 9:54 AM

Low Rates are Back

I thought for sure we had seen the end of super low rates. However, I am again surprised by the move of the Federal Reserve. Rates in the 5's are common and I have seen the reemergence of the 4's. I didn't think it would happen again in my lifetime. Short of World War 3, I thought we would have to get used to rates in the 7's. Well, the banks created financial armageddon and here we are.

Don't Be Fooled

Guess what? The wonderful people that brought on the mortgage collapse are the ones leading the charge to resurrect the market. I hear them on the radio all day long. You need a fixed rate, I can save you hundreds of dollars. These are the same people who promoted the adjustable rate craze that brought on the predicament we are in today. Don't buy into it. You need a firm that you can trust. AAA Mortgage has long been a proponent of fixed rate mortgages. We have never done a negative amortization loan. We steered clear of 125% Mortgages. Even when the market offered excellent financial incentive to promote these products, we knew that this was not in the best interest of our clients. We are looking out for you.

Navigating the Market

It is not easy to navigate the market these days. Companies are coming and going. Guidelines are getting tougher and the consumer is losing. We will help you through the process with honesty and integrity. Don't fall back into the loan trap. Call AAA today! (816) 272-5550

Posted by Jason Dillabough on January 18th, 2008 9:54 AMPost a Comment (0)

Zero Down Home Loans

January 10th, 2008 4:21 PM

Posted by Jason Dillabough on January 10th, 2008 4:21 PMPost a Comment (0)