: Marketing Opportunities: Homebuyer Tax Credit

Marketing Opportunities: Homebuyer Tax Credit

There is a lot of speculation about how, when and who the "NEW" Homebuyer Tax Credit affects.  We should be very clear in our information and learn how to effectively make the most of the opportunity.  If you are serious about building your database and business.  It is time to get your butts up and do something about it. 

The 90/10 Rule will apply! 

  • What side of that equation will you be?
  • How to make the most of this? 

Well, If I'm a REALTOR and I'm not (but I am going to do this anyway).  I would call the best marketing rep from a title company or Loan Officer (hopefully me) and request a list of homeowners that purchased in 2004 or before.  Then I am going to send them flyers, newsletters, bulletin, etc to tell them that they can upgrade and/or keep their property as an investment or not and move to a better home while obtaining $6,500 as a tax credit. I am also going to get on the internet and work out a massive Social Media campaign to get the buyers (and likley sellers) calling me!! 

Don't take my advice, I am just speaking out loud of what I am going to do!

What you need to know!

The $8,000 homebuyer tax credit for first-time buyers, due to expire in 25 days, will be extended through April 30 of next year and buyers will have an additional two months, until the end of June, to close. First-time buyers who are in the process of making a purchase will no longer need to worry about qualifying for the $8,000 credit if they close after the November 30 deadline. The new legislation increases the income limit for couples with income up to $225,000, a nearly $55,000 increase above the level in existing law.

For the first time, the new legislation makes buyers who already own a home eligible for a credit. A $6,500 maximum credit will be available to existing homeowners who have lived in their current residence for five of the prior eight years. The legislation limits eligibility for the existing homeowner credit to homes worth $800,000 or less.

The legislation takes effect December 1 and is not retroactive. Both credits are available only for primary residences, not second homes or investment properties.

Comment balloon 48 commentsTed Canto • November 06 2009 09:15AM

Comments

Great Post and great suggestion.  I think I'll take it and run with it.

Posted by Sandra Paulow, REALTOR, Associate Broker, GRI, SFR (Aspen Properties, Inc. ) over 8 years ago

Does it appear that closings after December 1st will qualify for the $6500 or does the effective date of the purchase contract have to be after December 1st?

Posted by Steve over 8 years ago

Thanks for sharing!!  I am trying to come up with some "out of the box" marketing ideas to get buyers attention...let me know if you have any fun and different marketing ideas!

Posted by Anonymous over 8 years ago

Steve, it will be effective for closings after Nov. 30th.  The contract has little to do with it rather the date in which it closes.  In other words, when the tax man comes knocking, they will require a Final HUD and that it should state the settlement date Dec 1st or thereafter.

Posted by Ted Canto, Arizonan #1 Mortgage Lender (Amerifirst Financial, Inc) over 8 years ago

Anonymous..  I have some ideas.  You can reach out to me and I would be mroe than happy to share some with you. 

Posted by Ted Canto, Arizonan #1 Mortgage Lender (Amerifirst Financial, Inc) over 8 years ago

Does a current home owner have to purchase a more expensive home?  That's what I'm wondering because it says "move up buyers".

Posted by Kristal Perrone, Associate Broker (Hunt Real Estate- Columbus Division) over 8 years ago

Semms like a plan...I see one problem though.  Targeting people who purchased say in the 2000 to 2004 time frame.  They bought at the top of the market with probably little or no money down.  Now the home value has dropped 10-15-20%.  They will not be in a good selling position.

Hope your plan works for you.  Good luck!!

Posted by Anonymous over 8 years ago

Well darn!!  Wasn't logged in!  Sorry!  Darn computers...

 

Seems like a plan...I see one problem though.  Targeting people who purchased say in the 2000 to 2004 time frame.  They bought at the top of the market with probably little or no money down.  Now the home value has dropped 10-15-20%.  They will not be in a good selling position.

Hope your plan works for you.  Good luck!!

Posted by Chuck Capan, REALTOR Licensed In IL. - Moline Homes Quad Citie (REMAX River Cities) over 8 years ago

Kristal.. I would say "It needs to make sense".. Not necessarily a more expensive home but it can be a 4 bd vs. their current 3 bd,  The house is closer to work, etc..  Besides, it comes down to the lender.  I would agree with it should be a more expensive home if I was with another company.  My underwriter doesn't look at it that way.  Every lender seems to see it differently these days.

Chuck, in my market (AZ) the properties took a beating but I still see properties purchased back in 00-04 with some equity.  I would say that most people who purchased in 00-02 are well better positioned as they have not lost all of their equity .  Besides, they do not necessarily have to sell.  In fact the SFR rental market in AZ is really hot as I am sure it is in a lot of other areas.  So most of the buyers can easily keep the home and rent the property relatively quick.  The other option is to take it in the shorts a little on the sale of their current home and use the credit to offset the loss and move into their new home.  

Chuck, I am very good at always finding a way to create opportunities.  My saying is "There is always room for Jello!"  I would say be the 10% and get your butt out there.  The worse that can happen is that you find a couple of short sale clients.  The funny thing here folks is that I am a Loan Officer and I thank my blessings and my peers because I have always found a way to make business work for me. So I have found myself almost consulting my REALTORS on ways to develop business.    It is the cornerstone of why REALTORS do business with me. 

Posted by Ted Canto, Arizonan #1 Mortgage Lender (Amerifirst Financial, Inc) over 8 years ago

Love it, love it, love it! Already got ahold of my favorite title company!  Grea idea, thanks

Posted by Trisha P Realty Group, "Holding the Keys to Your Dream Home" (Realty Executives) over 8 years ago

Ted, from what NAR sent it, it seems like it is from purchases at time of signing for the $6,500 credit. Have you heard that, and do you know if someone under contract settling in time (even after the 1st of December), if already under contract, would be eligible or is it from contract binding date???

Posted by Marney Kirk, Towson, Maryland Real Estate (Cummings & Co. Realtors) over 8 years ago

Good reminder to market to people who have been there house more then 5 years...

Posted by Chuck Carstensen, Minnesota Real Estate Expert (RE/MAX Results) over 8 years ago

Ted - some interesting suggestions, thanks for sharing, I do believe that I will try it.

Posted by Mike Saunders (Lanier Partners) over 8 years ago

Hi Ted -- I bet your business will thrive due to this pending legislation extension.  I heard it was suppose to be signed today, but I haven't seen any confirmation that the President signed it into law yet.

Posted by Chris Olsen, Broker Owner Cleveland Ohio Real Estate (Olsen Ziegler Realty) over 8 years ago

Marney:   BAsed on what I know about tax filing.  The accountant always requestes the HUD/ Settlement Statement.  Based on my knowledge, the date will need to say 12/01 or greater.

Thanks guys!  I think with a little bit of elbow and mind power, we can all benefit.  There are some in AR who really are opposed to all of this tax credit stuff.  I am not a big fan of spending either, however, there was also a report that more home purchases does put people back to work and not just RE pros either.  The other point was that it also increases spending on all levels.  As RE pros we know this but sometimes the ideological nonsense gets in the way of people's common knowledge.  There is way too much "Socialist Boogey Man" whining and not enough action on behalf of RE pros.

As Gary Vaneychuk said (he really did say this at a seminar I attended with 500 RE pros there):  "Bunch of whiners!!   Shut the F*#k Up and get to work!"

 

Posted by Ted Canto, Arizonan #1 Mortgage Lender (Amerifirst Financial, Inc) over 8 years ago

I already have a Thankful November letter plan to go out first thing next week to coincide with Thanksgiving as well as sharing this new Tax Credit information with my sphere.

I'm going to take so much advantage of this. It's like a second chance.

Posted by Loreena and Michael Yeo, Real Estate Agents (3:16 team REALTY ~ Locally-owned Frisco TX Real Estate Co.) over 8 years ago

By the way, I am licensed in most states.  If there is anything I can to do assist you, let me know.  We are a direct lender and have the ability to close in 10 days.  www.tendayclose.com

Just in case!!  Have a great weekend!

Posted by Ted Canto, Arizonan #1 Mortgage Lender (Amerifirst Financial, Inc) over 8 years ago

That is a very good idea to get the information for people who bought prior to 2004... wheels are spinning...

Posted by Donna Harris, Realtor,Mediator,Ombudsman,Property Tax Arbitrator (Donna Homes, powered by JPAR - TexasRealEstateMediationServices.com) over 8 years ago

Great ideas - we'll see if this new tax credit expansion will get the move-ups moving!!!

Posted by Emily Lowe, Nashville TN Realtor (The Lipman Group | Sotheby's International Realty) over 8 years ago

Sounds like you are more aggressive than a pack of wild mules! Good. Good for you, little fella. I appreciate what you do so much. 

Posted by Aaron Vaughn | Builder | Investor, If the deal makes sense, the cash will follow. (Conifer Homes) over 8 years ago

Hi Donna.. My wheels are always spinning.. I am passionate about what I do and I am so charged to be the best at what I do.   Seems you are going to join the 10% club!!  Yay!!

Emily, I would say to you, it is all in the marketing.   I will give you an analogy I share with naysayer REALTORS of Social Media..  "If you knew that most of your database and their friends were going to be at Starbuck's at 7 pm tomorrow.. Would you be there?"   I say to you, present the question in a way that makes sense to the client and position it to be what I call a "YES" question.  I wouldn't suggest that you expect the tax credit to do all the work, IT WON'T!!. 

It is imperative we use our knowledge of finances and paint the picture that helps the client's lightbulb to go on..   $6500 free money to the 2nd power = Free Money!!  LOL!!   If you need some tips, let me know.  

(by the way, I am licensed in TX and TN).  

Posted by Ted Canto, Arizonan #1 Mortgage Lender (Amerifirst Financial, Inc) over 8 years ago

Kyle, Thank you!!  I will confess this much (unlike some of us RE Pros)..  I took it in my best 2 friends during the bust.. For that I will say "shame on the economy and on me too".. At this point, I am using my GOD given talents and going to use them to the best of my ability.  Thank GOD for my skills as they now allow me to "NOT" originate loans anymore.  My business is dedicated now to helping agents build their business and I let my team do the paper pushing.  I have figured it out, if I help others build their business they will help me build mine. 

Posted by Ted Canto, Arizonan #1 Mortgage Lender (Amerifirst Financial, Inc) over 8 years ago

Great idea because I bet the majority of people don't realize that the expansion includes people who have lived in their homes 5 out of the last 8 years.  I think I'll look into this.

Posted by David Monsour, ABR - www.realty-insights.com (Keller Williams Keystone Realty) over 8 years ago

Thanks for the great idea!  Will work on it.  I thought the move up buyer would have to actually sell their home, and not keep it for investment purposes????  Additional, I like the idea of the move up buyer taking a small loss on the sale of their home and regaining it from the $6500 tax credit. 

Posted by Susan Jackson (America's Network Realty Group, Inc) over 8 years ago

For me... it will be contacting every home owner and letting them know that they still have a chance to get out while they can... ;) LOL!!

 

 

Posted by Paul Francis, Las Vegas Real Estate Agent - Summerlin Homes (Francis Group Real Estate) over 8 years ago

Good suggestion.  I think many of us have been focused on the 2004 and after.  This tax credit opens some opportunity for a "new" group of home buyers in the market.

Posted by Lisa Matykiewicz (United Brokers Group) over 8 years ago

Great ideas!  Love the Gary quote...sorry I missed his recent visit.  Now, let's get to work!

Posted by Anonymous over 8 years ago

Ted--great idea. This guy here in town by the name of mytitleguy? is suggesting the same. Maybe we should team up on it.

Posted by Blair Ballin (Conway Real Estate) over 8 years ago

Good information.  Great Ideas too!

Posted by Damon Gettier, Broker/Owner ABRM, GRI, CDPE (Damon Gettier & Associates, REALTORS- Roanoke Va Short Sale Expert) over 8 years ago

Very proactive idea ! I love it - making note and formulating gameplan !

Cheers Ted !

Posted by Sheldon Neal, That British Agent Bergen County NJ (Bergen County, NJ - RE/MAX Real Estate Limited) over 8 years ago

Thanks for sharing I have to look into it.  That WHY I love ACTVE RAIN...

Posted by Donna Paul, Long Island Home Specialist,All About Real Estate (Keller Williams Realty Gold Coast) over 8 years ago

This is the first time I have seen the actual effective date.  I would have thought it went into effect immediately.  Thanks for the information!

Posted by Lina Robertson, REALTOR® Serving Springfield, Nixa and Ozark, MO (RE/MAX Solutions and RE/MAX House of Brokers) over 8 years ago

Excellent information with great feedback.  I'm taking a closer look!

Posted by Audrey Ingram, CPM - Coldwell Banker United, Realtors - Bellaire over 8 years ago
Blair, I've heard of that My Title Guy! They say he is pretty ugly. LOL! As you already know, Stephen Garner (aka MyTitleguy) work on this stuff together closely all the time. I named us "The Dynamic Duo". In fact, I gotta nail you down for some coffee or breakfast to talk. We have some really cool ideas.
Posted by Ted Canto, Arizonan #1 Mortgage Lender (Amerifirst Financial, Inc) over 8 years ago

Ted, I just realized how similar our pictures look--weird. ;-) Dynamic Duo? I can see where you might be dynamic but Stephen? I think him and I are meeting on Wednesday maybe we should all meet then?

Posted by Blair Ballin (Conway Real Estate) over 8 years ago

Ted-Good stuff. My post is a just spinoff on expanding your idea. One of my suggestions it to contact your mortgage professional--the sky is the limit in ideas when its tag teamed.

While people that bought in 2004 may still be slightly upside down, if they have the ability to move up b/c they put a downpayment down or have paid enough equity down, they will still come out on top. While their home has lost value, if they are moving up in price range, they will make up for the loss on their purchase.  i.e. A home they might consider 5 years ago would have been $400,000, but now, its worth $360,000.  If they are moving up from a home they bought for $200,000 and they sell for $185,000, in the move up, they still have a positive bottom line of $25,000 on equity (lose $15K on the house, gain $40,000 on the move up).

Posted by Michele Reneau, Realtor, GRI ~ Charleston, SC Relocation Experts Team (Certified Staging Professional (CSP) Elite Instructor) over 8 years ago

According to NAR, the effective date for a current owner is the date of enactment (November 7, according to NAR).  So, you can get your move up buyers under contract to purchase today.  They do not have to wait until December 1.

All of the rules that were in effect for the first time buyers stay in effect until December 1.  As of December 1, first time buyers, as well as move up buyers, will be limited to a maximum purchase price of $800,000.

Check out NAR's website for more info:

http://www.realtor.org/home_buyers_and_sellers/2009_first_time_home_buyer_tax_credit

 

Posted by Bob Willis, Orange County & L.A. County Real Estate Agent (Berkshire Hathaway HomeServices California Properties) over 8 years ago

Ted you so rock - you are whole hearted invited to my office buddy!

Posted by Anna Banana Kruchten CRB, CRS 602-380-4886, Arizona's Top Banana! (Phoenix Property Shoppe) over 8 years ago

Interesting post. And you got a personal invite to Anna Banana's office plus a feature. Wow!

 

Posted by Erica Ramus, MRE, Schuylkill County PA Real Estate (Erica Ramus - Ramus Realty Group - Pottsville, PA ) over 8 years ago
Erica- Isn't AR great!
Posted by Ted Canto, Arizonan #1 Mortgage Lender (Amerifirst Financial, Inc) over 8 years ago
Thanks Anna! By the way, check out my blog on Fannie Mae signing rental agreements on their foreclosures. Must know info. for agents and your clients.
Posted by Ted Canto, Arizonan #1 Mortgage Lender (Amerifirst Financial, Inc) over 8 years ago

Do move up buyers have to sell their current home in order to get the tax credit?  I haven't seen anything saying they have to sell.  Do they?

Posted by Bob Willis, Orange County & L.A. County Real Estate Agent (Berkshire Hathaway HomeServices California Properties) over 8 years ago
Hi Bob.. They do not have to sell however, I will bet that the paper trail will be looked at closely to establish Owner occupancy on the new home. This is also an open window for fraud. Owners will now need to be very careful of 'NOT' reporting rental income on their tax returns (as many do not).
Posted by Ted Canto, Arizonan #1 Mortgage Lender (Amerifirst Financial, Inc) over 8 years ago

Good ideas.  All of the information that I have seen regarding present homeowners is that their part of the bill became effective on Saturday, November 7th.  I don't believe that they have to wait until December 1st.  In southeastern CT I believe that the homeowners who purchased in 2004 or earlier will be OK unless they did a cash out refinance and used up all of their equity.

Posted by Philip Turner, Mortgage Banker Since 1980 (MCCUE MORTGAGE COMPANY) over 8 years ago

Great points.  I'm figuring out how to target this immediately.

 

Posted by Mike Henderson, HUD Home Hub - 303-949-5848 (Your complete source for buying HUD homes) over 8 years ago

Ted:

 

Would you be willing to put some of the marketing materials on your Facebook.  You can use the program called SlideShare.  I would enjoy seeing the marketing pieces you use.  I would also be willing to trade some of my collateral pieces.

Posted by Jim Thomas over 8 years ago

Thanks for sharing such great information with us. I will get started now on the list of people who have been in there homes 2004 and before.

Posted by Deana Smedlund over 8 years ago

Ted I love this idea of yours. Brilliant. By the way do you do loans in Maryland and DC? Please say yes. I am going to need your help on coming up with a marketing plan. I am about to start e-mailing my mortgage brokers and title companies right now. Great post.

Posted by Lanre-"THE REAL ESTATE FARMER" Folayan, I don't make promises.I deliver results.SOLD HOMES (Keller Williams Select Realtors-Buy a home in Washington DC. Sell a home in Washington DC) over 8 years ago

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