How to Lower Your Property Taxes

Because your property tax is directly related to the value of your home, you have an opportunity to lower your property taxes* if your community has experienced declines in real estate values.

County authorities determine the taxation on a given property by multiplying the property tax rate by the property value. For example, if your home value is $800,000 and the property tax rate is 1%, then your property tax bill is $8,000 annually.

If market conditions have resulted in a decline in the value of your home, it is your right to have your property reassessed and to lower your tax rate. Your county will not initiate this process for you; you need to submit a proposal to your county tax assessor. The process takes between 30 and 45 days. Two methods are available to you:

• Do it yourself: Contact your county assessor’s office and download the forms from its website. You will need to hire an appraiser to help prepare the evaluation of your property to submit. There are multiple websites and books to guide you through this process.
• Hire a tax relief processor: This company should have experienced professionals who write, prepare, and submit your tax relief proposal to the tax assessor’s office for you. Look for a company that offers to waive any upfront fees in exchange for a percentage, usually around 50%, of your first year’s savings. The company will send an appraiser and submit all of the proper documents for you.

Although there are several steps involved in getting your tax rate reassessed, many homeowners have saved thousands of tax dollars annually by pursuing a reassessment.

*Always consult your tax advisor for tax information and advice.

Last Week in the News (February 16, 2009)

The Commerce Department reported that retail sales rose 1% in January after falling for six straight months. Economists had expected a drop of 0.8%.

Wholesalers reduced their inventories by 1.4% in December. The decline was twice as much as forecasted and the steepest since recordkeeping began in January 1992. It also was the fourth straight monthly decline. Sales at the wholesale level fell 3.6% in December after a 7.3% decline in November.

The Commerce Department reported Wednesday that the trade deficit fell 4% to $39.9 billion in December, from $41.6 billion in November. It was the lowest level in nearly six years.

According to RealtyTrac foreclosure filings — which include default notices, auction sale notices and bank repossessions — were reported on 274,399 homes during the month of January 2009, a 10% decrease from the previous month but still up 18% from January 2008.

New applications for unemployment benefits fell by 8,000 to 623,000 last week, the Labor Department said Thursday. However, the number of people continuing to claim jobless benefits rose to 4.81 million in the week ended January 31 from 4.78 million the prior week.

Upcoming on the economic calendar are reports on the housing market index on February 17, housing starts on February 18 and the index of leading economic indicators on February 19.

Happy Presidents' Day

On Presidents’ Day we celebrate the birthdays of George Washington (February 22, 1732) and Abraham Lincoln (February 12, 1809).

Did you know:

• The Mount Rushmore National Memorial features portraits of U.S. Presidents George Washington, Thomas Jefferson, Theodore Roosevelt, and Abraham Lincoln. The sculpture is only about 60% done, though nearly 400 workers spent over 14 years on the project. Originally, the plan was to carve the figures from head to waist, but insufficient funding forced the carving to end.
• Abraham Lincoln, our 16th president (1861 – 1865), presided over the Civil War, where he never let the world forget the larger issue of the conflict: the abolition of slavery. In 1863, he issued the Emancipation Proclamation that declared forever free those slaves within the Confederacy.
• George Washington earned the designation Father of His Country for his great leadership, both as Commander in Chief of the Continental Army and in unifying the new nation under a central government.

Last Week in the News (February 9, 2009)

On Monday, February 2, the Institute for Supply Management said its manufacturing index rose in January to 35.6, up from a record low of 32.9 in December. Any reading below 50 signals contraction. Economists had expected a reading of 32.6.

The National Association of Realtors (NAR) reported that its pending home sales index, a forward-looking indicator based on contracts signed, rose 6.3% to 87.7 in December 2008. NAR chief economist Lawrence Yun said the index shows a modest rebound. “The monthly gain in pending home sales, spurred by buyers responding to lower home prices and mortgage interest rates, more than offset an index decline in the previous month,” he said.

The Commerce Department reported total construction spending fell 1.4% in December, more than the 1.2% decline economists had expected. It was the third consecutive monthly decline. In 2008, construction spending fell by a record 5.1% compared to a decrease of 2.6% in 2007.

Consumer spending fell 1% in December after a 0.8% decline in November. This marks a record sixth consecutive monthly decline in consumer spending. For the year, consumer spending rose by 3.6%, the smallest annual increase since 1961. On a positive note, the savings rate rose to 3.6% in December. That was the highest level since tax rebate checks pushed the rate up to 4.8% in May 2008.

On Thursday, the Labor Department said new applications for unemployment benefits rose last week to a seasonally adjusted 626,000 from a revised figure of 591,000 the previous week. Economists had anticipated a reading of 583,000.

On Friday, the Labor Department reported that the nation’s unemployment rate increased to 7.6% in January from 7.2% in December. Businesses cut 598,000 jobs in January, the biggest monthly decline since December 1974.

In other economic news, the Commerce Department said factory orders declined by 3.9% in December, a record fifth straight drop.

Upcoming on the economic calendar are reports on retail sales on February 12 and consumer sentiment on February 13.

Last Week in the News (February 2, 2009)

On Monday, January 26, the National Association of Realtors said existing home sales rose 6.5% in December to a seasonally adjusted annual rate of 4.74 million units. Economists had expected an annualized rate of 4.4 million units and suggested that bargain prices are bringing buyers back into the market.

The median existing home price in December 2008 was down 15.3% to $175,400 from December 2007. It was the biggest year-over-year drop since recordkeeping began in 1968.

The Conference Board said its leading indicators of future economic activity rose 0.3%, a better reading than the 0.3% drop economists had expected. The index indicates the direction of the economy over the next three to six months and the reading was the first gain in six months.

On Tuesday, the Standard & Poor’s/Case-Shiller 20-city housing price index dropped a record 18.2% from November 2007 to November 2008. Since August 2006, the 20-city index has declined every month.

Consumer confidence hit a record low in January. The Conference Board reported that its consumer confidence index fell to 37.7 in January from a revised 38.6 in December. In January 2007, the index was at 87.3.

The Commerce Department said Thursday that new home sales fell 14.7% in December to a seasonally adjusted annual rate of 331,000. It was the slowest monthly pace on records dating back to 1963.

Orders for durable goods fell for a fifth consecutive month. The Commerce Department said orders dropped by 2.6%, worse than the 2% decline economists had expected.

Gross domestic product — the total output of goods and services produced in the United States — decreased at an annual rate of 3.8% in the fourth quarter of 2008, the Commerce Department announced Friday. It was the lowest pace since the first quarter of 1982, when output contracted 6.4%. Economists had expected a much worse 5.5% contraction.

Upcoming on the economic calendar are reports on pending home sales on February 3 and factory orders on February 5.

Buy a Home For Only 3% Down!

Buy a Home For Only 3% Down!

Fannie Mae, the agency sponsored by the U.S. government to help make housing more affordable to all Americans, now offers HomePath, a special new home loan to finance the sale of its current real estate owned (REO) properties across the country.

We are among a select group of mortgage lenders nationwide who can offer the HomePath loan to get you into one of these homes!

Here are the key benefits of a HomePath Mortgage Loan:

• Only 3% down required on a primary residence property
• No mortgage insurance required
• No property appraisal required
• Only 10% down on 1-2 unit investment properties
• Get up to 6% in seller concessions on primary residence properties

In addition to being one of the few lenders approved to offer the HomePath loan, we’re experts with REO transactions. I have been specially trained to handle the specific requirements of an REO transaction. I’ll keep the process smooth and stress-free.

Search for Fannie Mae REO properties eligible for HomePath financing at: http://reosearch.fanniemae.com/reosearch/

Contact me today to learn more about the HomePath program!

Last Week in the News (January 26, 2009)

On Wednesday, January 21, it was announced that the National Association of Home Builders/Wells Fargo housing market index fell one point to eight in January, the lowest level recorded since the index was created in 1985. The index held steady at nine for December and November and was 14 in October. An index reading higher than 50 indicates positive sentiment about the housing market. The index has been below 50 since May 2006, and below 20 since April 2008.

The Labor Department reported Thursday that new applications for jobless benefits increased by 62,000 to a seasonally adjusted 589,000 in the week ended January 17 from a revised 527,000 the prior week. Economists had expected a reading of 543,000. U.S. employers cut 2.6 million jobs last year. The total number of people collecting unemployment benefits increased to 4.607 million.

The Commerce Department reported that housing starts fell 16% in December to a seasonally adjusted annual rate of 550,000 units, the lowest on record. It was a much bigger decline than the 610,000 economists had expected. This follows an upwardly revised rate of 651,000 units in November and 791,000 units in October. Meanwhile, building permits fell 10.7% in December to 549,000 units, also a historic low, from 615,000 units in November.

In other news, the U.S. Treasury is now demanding monthly reports from the banks that received the most capital from the government’s $700 billion Troubled Asset Relief Program. Neel Kashkari, the program administrator, wrote to Citigroup, Bank of America, Wells Fargo and 17 other financial institutions on January 16 seeking figures on business and consumer loans.

Upcoming on the economic calendar are reports on existing home sales on January 26, new home sales on January 29 and gross domestic product on January 30.