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The Enormously Big Deal of Buying a House
When it comes down to choosing between buying a house in Sacramento or having a baby, the latter is a bigger deal for most people, yet you can’t rule out the enormously big deal of buying a house. The Washington Post talks about the financial constraints felt by many in today’s economy and how, while waiting for improvement, some decisions are postponed, as in this part of the article: “Choices large and small hang in the balance — whether to buy a house, go to college, get married. Have a baby.”
I don’t know about you, but all of those choices seem ginormous to this Sacramento real estate agent. I don’t spot a “small” choice in that grouping. Not only that, but buying a house is often said to be the single most expensive investment a person can undertake. They are all big choices and decisions, accompanied by their friends: anxiety, risk and anticipation.
As a person who works with people to sell and buy Sacramento real estate, I can tell you it’s also a highly emotional experience, mixing the love of all things drywall and wood with Ben Franklins. One moment a person is hyperventilating and the next cooing. I never know what I might find on the other end of the phone when I answer.
It’s my place to be empathetic and listen. To be that rock to lean on. To offer support and guidance and help sellers and buyers through my decades of experience to make the right decision. Sometimes it means taking the lead and saying, OK, look, here’s what we’re gonna do. Offering that solution. Other times, I need to sit back and wait for the information to sink in and for the parties to reach a state of calmness, awareness and decision-making capability.
I help people make a transition. And transitions are a big deal in life. Your Sacramento real estate agent is a coach for you, not a crutch, but we can be that, too, if that’s what you need.
Check Out Devine Gelateria in Midtown Sacramento
I guess while the *Sacramento Bee was pulling together a story about the sale of the Washington Post to a guy who amassed a fortune selling books on the Internet, the reporter ran across the Washington Post story about the guy in London who, financed by another Internet giant, has produced the world’s first stem cell hamburger. My first reaction was ewww, but then, what the hell; we have fake food in our freezer and I eat it for lunch. That stuff is made from chemicals and sold as Lean Cuisine and Healthy Choice. Stem cell burgers don’t sound so bad.
You know what really tastes great, though? Gelato. It’s every bit as good as ice cream and some people might say, better. One taste and you’ll be addicted. If you like ice cream or frozen yogurt, you will adore gelato. I especially like Sea Salt Caramel. My favorite flavor used to be mint chocolate chip. Even though I would be presented with 31 flavors, didn’t matter, I would always choose the sure thing: mint chocolate chip. I figured I liked it so why not order it. Can’t go wrong. Unless, of course, you figure that you’re missing out on dozens of other flavors that could be a “favorite.” Who says a favorite has to be only one thing? You can have lots of favorites.
If you’re in Sacramento and live near Midtown, one of the best gelato stores in the city, and they are up for a vote in Sacramento News and Review as Best Sweet Treat, is Devine Gelateria on 19th Street just south of Mulvaney’s, between L and Capitol. They make dozens of flavors; the gelato is hand crafted. I asked the clerk behind the counter if she had a loyalty card, because we’ve been to Devine Gelateria 3 times in the past couple of weeks, but they were out of print. That’s how popular this place is, and you’re missing a fabulous treat if you don’t go there.
Although we live in Land Park, we walk to Devine Gelateria. Yes, we actually put on shoes and walk down the street instead of driving. Last Sunday, I know this will shock some of you, we walked downtown to the Sacramento Public Library, then over to Devine Gelateria in Midtown. On our way back to Land Park, we made a fortitude pitstop against the Sacramento heat at Shady Lady for a summer cocktail and a snack: tator tots stuffed with duck. We sampled a Gin Daisy and a Rita Hayworth. Our bill with tip came to $34. Remember when $34 would buy you groceries for a week? Our round-trip walk was a little over 5 miles. I figure we at least burned up the calorie intake from Devine Gelateria. Don’t know about the tator tots with duck.
*Note: See, there are stories you get in the print edition of the Sacramento Bee that you will not find at its online website.
Why You Might Not Care About Mortgage Debt Relief
Many of my Sacramento short sale sellers are concerned about the mortgage debt relief extension, which is presently sitting at the U.S. Senate in limbo. Mortgage debt relief is the process of relieving a seller of having to pay taxes on forgiven / canceled debt. For example, if you sell a home for $100,000 and you owe $200,000, the bank is forgiving $100,000 of debt when it does a short sale or a foreclosure. Under regular IRS rules, you might be responsible for paying taxes on $100,000 of income that you did not get in your hot little hands. If you’re in a 30% tax bracket, that’s $30,000 you could owe the IRS.
At present, this relief from taxation expires at the end of this month, on December 31, 2012. There is a bill extending the relief through 2013. It stems from an original bill that was passed 5 years ago and has been extended ever since: the 2007 Mortgage Forgiveness Debt Relief Act. The big question is will it be extended again?
The bigger question should be what happens if it doesn’t? Are you affected? This is the question I would like every Sacramento area short sale seller to ask an accountant. Don’t go poking around online reading crap that may or may not be true — including this blog. I am not an accountant. I cannot give you tax advice. I am a Sacramento short sale agent. I sell homes all over a four-county area. Lots of them. More than 100 a year. But I don’t give tax advice.
Having said that, I will tell you that accountants have told me that California purchase money loans are not affected. They say it does not matter whether you close this year or next year or ten years from now, if you have a purchase money loan and you live in California, there are no taxes due on that canceled debt. Furthermore, mortgage debt relief is not a short sale exception. If you have to pay taxes for some reason on canceled debt, it applies to foreclosures as well as short sales. So, opting for foreclosure instead of doing a short sale is not going to save your butt. But don’t take it from me, ask your accountant.
Moreover, ask your accountant about insolvency exceptions. If you owe more than your assets are worth, you might be insolvent. Insolvency does not mean you are sleeping under a bridge and holding a sign saying something goofy like you will work for food when what you mean is you would like somebody to give you some money. It means your liabilities exceed your assets. Almost every short sale seller is in that boat. If you are insolvent, the government makes an exception for you.
So, before you get all excited over whether the mortgage debt relief will be extended, please, I beg of you, talk to an accountant. Doing a short sale is stressful enough without adding this little quirk to it. It might be totally unnecessary for you to stress over mortgage debt relief. Read this recent article by reporter Ken Harney in the Washington Post, after he interviewed this Sacramento short sale agent about mortgage debt relief.
