Archives for October 2020

Mortgage Rates Hit Record Lows for Three Consecutive Weeks

October 23, 2020 by chorton Leave a Comment

Mortgage Rates Hit Record Lows for Three Consecutive Weeks | Keeping Current Matters

Over the past several weeks, Freddie Mac has reported the average 30-year fixed mortgage rate dropping to record lows, all the way down to 3.03%. Last week’s reported rate reached the lowest point in the history of the survey, which dates back to 1971.

This is huge for homebuyers. Those currently taking advantage of the increasing affordability that comes with historically low interest rates are winning big.

Clearly, buyers are capitalizing on today’s low rates. As shown in the chart below, the average monthly mortgage payment decreases significantly when rates are as low as they are today.

Mortgage Rates Hit Record Lows for Three Consecutive Weeks | Keeping Current Matters

A lower monthly payment means savings that can add up significantly over the life of a home loan. It also means that qualified buyers may be able to purchase more home for their money. Maybe that’s a bigger home than what they’d be able to afford at a higher rate, an increasingly desirable option considering the amount of time families are now spending at home given today’s health crisis.

If you’re in a position to buy a home this year, Preferred Properties of Texas would love the opportunity to initiate the process while mortgage rates are historically low. Contact our office today to speak with one of our knowledgeable agents.

Why You’ll Win by Selling with a Real Estate Agent This Fall

October 21, 2020 by chorton Leave a Comment

There are numerous advantages to working with a real estate professional when purchasing your house. During hard times, like what we confront now, it becomes even more important to have an expert that you trust to help guide you through the procedure.

Your family’s safety should always come first, which is more critical than ever given the present health condition in our country. When you FSBO, it is incredibly hard to control entry into your house. A real estate professional is going to have the proper protocols in place to protect not only your belongings but your family’s health and well-being too. From controlling the amount of men and women in your house at one time to ensuring good sanitization through and after a showing, as well as easing virtual tours for buyers, real estate professionals are equipped to follow the latest industry criteria recommended by the National Association of Realtors (NAR) to help protect you and your family.

Recent studies in NAR have proven that, even before COVID-19, the first step 44% of buyers obtained when looking for a home was to search online. During the process, that number jumps to 93 percent. Now, those numbers have grown exponentially. Most real estate agents have developed a strong Internet and social media strategy to market the sale of your residence. Have you?

As a part of their instruction, brokers are instructed how to negotiate every aspect of the real estate transaction and how to mediate the emotions felt by buyers seeking to make what is probably the largest purchase of their own lives.

Possessing a buyer who wants to purchase your home is the first step. Making sure they can afford to purchase it is just as important. As a FSBO, it is almost impossible to participate in the mortgage process of your purchaser.

Further complicating the situation is the way the current mortgage market is quickly evolving due to the amount of households out of work and in mortgage forbearance. A loan program which was available yesterday could be gone tomorrow. You need someone who’s working with lenders every day to ensure your buyer makes it to the final table.

The documentation included in the selling process has improved dramatically as more and more disclosures and regulations have become mandatory. In a litigious society, the agent acts as a third party to aid the seller avoid legal jeopardy. This is only one of the major reasons why the percentage of people FSBOing has dropped from 19% to 8% over the last 20+ years.

Many homeowners believe they’ll save the actual estate commission by selling on their own. Realize that the chief reason buyers look at FSBOs is since they also think they can save the real estate agent’s commission. The seller and buyer can’t both save on the commission.The more buyers who view a house, the greater the opportunity a bidding war will take place.

Listing on your own leaves you to manage the entire transaction by yourself. Why do that when you can hire an agent and still net the same amount of money? Before you decide to take on the challenge of selling your house alone, reach out to a local real estate professional to discuss your options.

Preferred Properties of Texas is here for all your real estate needs. Give us a call today.

Selling your home in Stephenville

Buying a home in Stephenville

What is a 1031 Exchange?

October 20, 2020 by chorton Leave a Comment

When property is sold, the seller pays national tax on any gain or deducts for reductions. Section 1031 of the tax code provides citizens an opportunity to defer any gain on the sale of qualified property. Most trades are completed through a business which specializes in 1031 exchanges (an intermediary). The IRS has published rules (safe haven rules) to get an intermediary aided swap. If these principles are followed, the IRS won’t challenge the trade. This safe harbor is a main reason for using an intermediary to assist in the market.

The 1031 exchange provision is only for investment and business property, and that means you can not swap your main residence for another residence. There are ways that you can use a 1031 for swapping holiday homes, yet this loophole is a lot narrower than it was. Many 1031 exchanges involve real estate, nevertheless, some exchanges of personal property (say a painting) can be eligible. Notice , that exchanges of corporate stock or partnership interests don’t qualify. On the flip side, interests as a tenant in common in real estate perform.

Most exchanges should only be of”like-kind”, a term that does not mean exactly what you think it means. You can swap an apartment building for raw land, or even a ranch for a retail center. The principles are amazingly liberal. You may even exchange one company for a different but there are traps for the unwary.

When an intermediary is utilized, an exchange may convey the sold property (relinquished property) right to a purchaser with the proceeds of the sale paid directly to the intermediary. When the exchanger purchases the replacement property, the intermediary pays the exchange funds to the vendor of the replacement property. Title to the house usually does not pass through the intermediary.

Under Section 1031 tax on a gain is postponed, maybe not entirely forgiven. Finally when the replacement property is sold, the tax on the deferred gain must be compensated unless additional provisions of this tax code are used to completely eliminate the taxable gain.

Timing
There are two critical time intervals for exchanges: the identification period and the trade period. Both start on the date the relinquished property is sold and operate simultaneously.

The identification period is 45 days. During this 45-day phase replacement property must be designated or identified in writing. If the replacement land is not identified within this 45 day period, the exchange fails and all profit realized from the sale of the replacement home will be taxable.

The exchange must be completed within 180 days of the closing date to the relinquished property. This 180 day period runs concurrently with the 45-day designation period. It is not inserted to the end of the designation period. It is not feasible to extend either the identification period or the trade period.

If the exchanger records a tax return for the year of the trade, the exchange period is terminated. When an exchange has not yet been done by the date a tax return is expected, a request for an extension of time to file the tax return must be submitted in order to get the entire 180 day interval to complete an exchange.

Steps to Follow
After the sale of their relinquished property, the sales proceeds need to be sent to the qualified intermediary pending the purchase of the replacement house.
Identify replacement property within 45 days of the sale of their relinquished property. Following the 45-day identification interval, only real property identified as potential replacement property qualifies as replacement property.
Contract to Buy replacement property.
Notify the intermediary of the contract to purchase replacement property and supply information about the closing of the purchase.
Within 180 days of the date of sale of relinquished property, purchase the replacement property, using exchange proceeds held by the intermediary.
The 180-day purchase period runs concurrently with the 45 day identification period.

Texas Ranch Land for Sale

1031 Exchanges & Real Estate

October 15, 2020 by chorton Leave a Comment

If you’re thinking about a Section 1031 Exchange or even only would like to discover more about how a market functions, this is a great place to begin learning. By no signifies is this information full and in most all circumstances you may wish to check a professional tax advisor prior to starting an exchange.

Section 1031 of the IRC code contains many criteria that have to be followed to perform an effective trade. These subjects represent a subset of these provisions. As always, seek council early along with your accountant or taxation advisors.

QUALIFYING PROPERTY
The property that you intend to obtain (the”Replacement Property”) should also be utilized on your trade/business or held for investment, rather than obtained for private use.

The Relinquished Property and the Replacement Property shouldn’t be stock, or other land that is held mainly for resale in the normal course of business (“seller property”).

TAX DEFERRAL
Any money or alternative”unlike-kind” property obtained in the market is called”boot” and might lead to a taxable profit. “Old” debt has to be substituted with”fresh” debt or”fresh” money. Boot received might not be entirely taxable when the amount of boot received is significantly less than the profit realized on the trade or if a law differently exempts the profit from taxation.

SELLER FINANCING
While possible in certain instances for a minimum time period, seller funding makes the trade more complex and in many cases impossible.

SALE PROCEEDS
The Intermediary have to hold these resources to prevent”constructive receipt” problems.

Furniture, equipment, a few possessions and other private property transferred together with the Relinquished Property or the Replacement Property isn’t”like type” to property, and can be treated as transported unless the Replacement Property includes”like type” furniture, equipment, or other private property. When it’s treated as boot, then you have to pay tax on its own worth.

The title into the Replacement Property has to be accepted by precisely the same proprietor of the Relinquished Property. The replacement property ought to be acquired with the aim to hold. A disposition in a couple of years after receipt could call in to question the intent to maintain.

The Texas 1031 Exchange Company functions as the Intermediary from the exchange and doesn’t practice law or bookkeeping. You have to depend on the advice and counsel of your own tax advisor and/or lawyer for this foreign exchange trade.

You have to compose a letter that identifies each the possible replacement properties to Your Texas 1031 Exchange Company or the right party to the trade within 45 times after the transfer of the Relinquished Property.
Buy of the Replacement Property Has to Be performed within 180 times after the transfer of the Relinquished Property. The legislation permits couple extensions (catastrophe or combat zone support ). Any property obtained as Replacement Property has to be contained at the 45 day identification letter mentioned previously.

If you spot Replacement Property within the 45 — day trial interval and purchase a few but not all the property you have diagnosed with no constraints, then you shouldn’t withdraw any residual funds from the exchange account before the 180-day exchange interval is finished. Inappropriate withdrawal in the trade account destroys the trade. Therefore, to be secure, the capital should not be removed before the expiry of the replacement interval or until all qualified properties are bought.

Repairs or improvements made into the Replacement Property once you get the titles don’t count as a portion of the expense of the Replacement Property for trade functions. If repairs or improvements are essential, and should you will need the cost represented since the Replacement Property, then the Replacement Property must be originally deeded into the Qualified Exchange Accommodation Titleholder before the repairs are finished. To be included in the trade improvements have to have been finished from the 180th day of the market. Prepaid materials or labour costs don’t qualify. You will find additional fees when developments are created as a member of this market.
LIKE-KIND PROPERTY
In respect to property,”in-house land” is defined as property and whatever which are permanently connected to the property. By way of instance, a ranch could be traded for a home, office building, or shopping centre. The fair market value of this furniture at work building you get isn’t”like-kind”, but instead is considered”boot” received. You may pay tax on the fair market value of this furniture obtained unless you do a different Personal property market by buying”like-kind” furniture.

IRS REPORTING DEADLINE
RELATED PARTY EXCHANGES
Please contact your tax advisor to learn more if this expression applies to your trade.

The above advice isn’t legal or tax information however presented for your consideration and information. Please consult with your legal or tax advisor for queries related to finishing your 1031 exchange.

Texas Ranch Land for Sale

Buying Hunting Land

October 5, 2020 by chorton Leave a Comment

From the searching discourse, few competitions the sense of owning your own hunting property. Hunters, who have searched to a buddy’s property or public property in prior years, will notably experience unprecedented liberty. For once, they’ll be the sole owner setting and creating the governing rules and regulations of the searching land.

Hunters possessing their own territory will have the ability to handle several aspects of this land they would need to compromise . How a lot of people would you like access to your property? Would you need to be the sole hunter on the property? You have to pick.

These advice for purchasing hunting property will direct first-time buyers through all the main variables to take into account while buying that ideal back 40.

1. CONSIDER YOUR BUDGET

The main suggestion to consider when buying your hunting property is to ascertain your budget before starting to look for the ideal property. A hunter’s funding will determine a good deal of different facets surrounding potential searching plots. These variables include the size, place, and carrying capacity of their property (how many human animals in certain species that the property can hold).

This step in the procedure also includes determining if you’re going to write a check to your property or fund a loan connected to the property.

2. Pick a RECREATION REALTOR

Individuals seeking to purchase their first home usually get in touch with a residential property specialist. Hunters seeking to purchase their very first plot of land must behave similarly and get in touch with a realtor that’s familiar and comfortable with hunting hosting and for searching territory.

A realtor that’s knowledgeable about the recreational land-owning procedure and understands what to look for while purchasing hunting property won’t just speed up the searching process but also supply additional wisdom which may positively impact your buying experience.

3. TYPE OF HUNTING LAND

Not all hunting property is made equally. Are you seeking to construct a hunting cabin or other construction on the home? Are you really going to get the property from the street or from ATV or alternative procedures? Are there sufficient trees to maintain different tree stands?

Every one these questions, together with a couple of other people, should be taken into account when assessing a possible article of hunting property. Other concerns to be considered include the properties situated adjacent to the searching territory.

4. DO THE NEIGHBORS HUNT?

Allowing to landowners in the region is a good way to learn extra information related to the property you’re assessing. Do your neighbors follow pest control practices? Are they seekers themselves? Can they allow many different seekers to get their territory?

Establishing a wholesome relationship with your adjoining neighbors early on from the landowning procedure will provide you a fantastic idea of how things will unfold later in the season if you’re competing for wildlife.

5. FOOD & SHELTER FOR WILDLIFE

The entire reason to get hunting property is in order to search on it. It is difficult to search on a plot of land which retains no wildlife. The ideal method to judge the carrying capability of a specific plot of land, besides really seeing deer or other species around the property, is to gauge how much shelter and food are gift for wildlife around the house.

ENJOY YOUR HUNTING LAND!

Owning your own article of hunting property can be quite a rewarding and pleasurable experience. Hunters after the prior strategies for purchasing hunting property will certainly understand what to look during the land-owning procedure. If you are thinking about buying hunting property, take a look at the wide choice of properties accessible at Preferred Properties of Texas, now.