The Ponte Team May Newsletter

Under One Roof

Presented by Ponté Team

May – June, 2008

Keeping the Economy in “Flow” We were just thinking about all the people

service, port- a- potty service … you get the

involved in a real estate transaction. Did you ever

idea. We could go on and on.

stop to think about all the jobs the sale of one home creates? The circle of people involved in the sale of your home on average is about 28.

Think about it: the listing Realtor , buyer’s Realtor, sign company to install post and sign, photographer, Internet contact, printer, brochure delivery service, escrow agent, title agent, attorney, loan officer, appraiser, termite inspector, home inspector, cleaning crew, landscape crew, painter, handyman, plumber, electrician, heating/AC, roofer, pool service and utility companies including gas, electric, water, phone, and perhaps septic.

And … if it is a remodel: the builder, contractor, architect, framer, electrician, plumber, roofer, framer, dry wall crew, stucco crew, concrete company, carpet installer, tile installer, cabinet designer, appliance company, granite company, clean-up crew, dumpster

Featured

Property

Spectacular Paradise Valley Home

You see, these people hire CPAs, bookkeepers, secretaries, financial planners and attorneys.

They buy cars, trucks and gas. They travel, have kids …

Real Estate is the “heartbeat” of the economy.

There are some great opportunities out there at this time. Good interest rates, reasonable pricing, good properties—equals “Good Value.” The time is right to take advantage of the opportunities to invest and to boost this economy. We welcome the opportunity to help

Arizona casual

you find that “value” to add to your portfolio.

living at its best!

We feel that we, The Ponte Team, are your best choice in the Real Estate Field …

… because we care!

P.S. Soon the Referral Directory of our vendors will be posted on our website at

www.ponteteam.com

The Value of a Smile It costs nothing but creates much.

It enriches those who receive, without impoverishing those who give.

It happens in a flash and the memory of it sometimes lasts forever.

None are so rich they can get along without it, and none so poor but are richer for the benefits.

It creates happiness in the home, fosters good will in a business, and is the countersign of friends.

It is rest to the weary, daylight to the discouraged, sunshine to the sad and Nature’s best antidote for trouble.

Yet it cannot be bought, begged, borrowed, or stolen, for it is something that is no earthly good to anybody until it is given away. ~ Excerpt taken from Dale Carnegie’s How to Win Friends and Influence People

Home built by Schultz in 2005.

Xeriscape landscape. Wonderful floor plan.

5 bedrooms, 5.5 baths and guest house with 1 bedroom, full bath and great room with kitchenette. 3-car garage plus an oversized 2-car garage (accessed via an electric gate).

Interior amenities: flagstone flooring in all traffic areas, granite countertops, 6-burner gas Viking cook top, dual Dacor ovens, center island, kitchen desk/computer station overlooking pool/patio.

Covered rear patio length of home surrounding pool area. Wet bar in family room with wine chiller/ice maker. Please note: children’s’ wing has 3 bedrooms all with full baths and walk-in closets.

Paradise Valley address/Scottsdale schools/ Phoenix city services.

6222 E. Turquoise Avenue Paradise Valley, 85253 Offered at $2,295,000 MLS# 2834886 www.6222ETurquoiseParadiseValleyAZ.com

TAX ip p i T T FHA Loans and Programs The Mortgage Forgiveness Debt Relief Act of 2007 MORTGAGE

Did you know FHA loans are more relevant than ever in today’s housing market? Whether you are a first time home buyer or have small amount of equity and need to refinance into a fixed rate loan, FHA loans are a safe option.

FHA offers some of the most competitive interest rates today starting at 5.75% for a 30-year fixed (APR 5.964) and require a 3% down payment. FHA loans have a minimum required credit score of 580 and the maximum loan amount is $346,250. Down payment assistance programs through companies such as Ameridream and the Home Down Payment Gift Foundation are available for those with little or no money to put down. These gift programs provide the opportunity for sellers to contribute 3% towards a down payment and 3% towards closing costs. In today’s market, many people listing their homes will be willing to negotiate gift funds and a credit for closing costs in order to sell their home. Please feel free to contact me if you have any questions regarding FHA programs or other mortgages available in today’s market.

Brannon Bartley Legacy Home Mortgage 4040 E. Camelback Rd., Suite 200 Phoenix, AZ 85018 602-468-4155 Office 602-402-7520 Cell Fax 602-468-2999 bbartley@legacyhome.us www.legacyhomemortgage.com

“I am only one, but still I am one.

I cannot do everything, but still I can do something; and because I cannot do everything, I will not refuse to do something I can do.” ~ Edward Everett Hale

Addressing the subprime lending crisis, Congress recently passed and the President signed into law a new measure giving tax breaks to homeowners who have mortgage debt forgiven.

Under preexisting law, the debt forgiven by a lender, such as for short sales and refinances, was generally taxable to the borrower as debt discharge income. With the passage of the Mortgage Forgiveness Debt Relief Act of 2007, a taxpayer does not have to pay federal income tax on up to $2 million of debt forgiven for a loan secured by a qualified principal residence. The change in the tax law applies to debts discharged from January 1, 2007 to December 31, 2009.

Here are the details.

Discharge of indebtedness income: background.

For income tax purposes, a discharge of indebtedness-that is, a forgiveness of debt-is generally treated as giving rise to income that’s includible in gross income. However, a discharge of indebtedness doesn’t give rise to gross income if it: (1) occurs in a Title 11 bankruptcy case, (2) occurs when the taxpayer is insolvent, (3) is a discharge of qualified farm indebtedness, or (4) is a discharge of qualified real property business indebtedness.

Under pre-2007 Mortgage Relief Act law, there were no special rules applicable to discharges of acquisition debt on the taxpayer’s principal residence. For example, assume a taxpayer who isn’t in bankruptcy and isn’t insolvent owns a principal residence subject to a $200,000 mortgage debt for which the taxpayer has personal liability. The creditor forecloses and the home is sold for $180,000 in satisfaction of the debt. Under pre-2007 Mortgage Relief Act law, the debtor had $20,000 of debt discharge income. The result was the same if the creditor restructured the loan and reduced the principal amount to $180,000.

New law relief provision.

The 2007 Mortgage Relief Act excludes from a taxpayer’s gross income any discharge of indebtedness income by reason of a discharge (in whole or in part) of qualified principal residence indebtedness before January 1, 2010. The exclusion applies where taxpayers restructure their acquisition debt on a principal residence or lose their principal residence in a foreclosure.

For example, assume the same facts as in the

example above except that the discharge occurs in 2008. Under the 2007 Mortgage Relief Act, the debtor has no debt discharge income when the creditor (1) restructures the loan and reduces the principal amount to $180,000 or (2) forecloses with the result that the $200,000 debt is satisfied for $180,000.

Here is some of the critical fine print in this new relief provision: • The tax relief applies to the original purchase price, plus improvements, of the taxpayer’s principal residence. It doesn’t apply to discharges of a second mortgages or home equity loans, unless the loan proceeds were used to acquire, construct, or substantially improve the taxpayer’s principal residence.

Refinanced indebtedness qualifies to the extent it doesn’t exceed the amount of indebtedness being refinanced (Cash out from refinancing doesn’t quality for the exclusion.)

• The indebtedness must be incurred with respect to the taxpayer’s principal residence only. The exclusion rule doesn’t apply to second homes, vacation homes, business property, or investment property, since these properties aren’t the taxpayer’s principal residence.

• The relief provision is not a permanent fixture of the tax code. It only applies to forgiveness during 2007, 2008, or 2009.

• Nontaxable forgiven mortgage debt is capped at $2 million ($1 million for married individuals filing separately).

• When the relief provision applies, the basis of the individual’s principal residence is reduced by the amount excluded from income.

As a result of this basis reduction rule, the discharged indebtedness is, at least technically, subject to taxation at a later time, when the taxpayer sells or exchanges the principal residence. However, in many cases the reduction won’t result in any additional tax, because any gain on that sale or exchange will qualify for the $250,000 ($500,000 for married couples filing jointly) homesale exclusion.

Dennis R. Abold CPA, CVA 602-274-7217

Tip

Tip

INSPECTOR

LEGAL

New Homes Need Inspections Too

Arizona’s Homestead Exemption

Why would a brand new home need a visit from

Reason #4

a home inspector? The simple truth is inspecting

Discover improper items during the warranty

a new home is as important as inspecting a home

period. Most components have one- or two-year

in a resale transaction.

warranties. We’ve seen many disgruntled sellers

Our experience, in inspecting over 4500 homes, has shown us there is a considerable list of issues identified on most new home inspections. The top four reasons are:

of newer homes wishing they’d had their home inspected when these defects are discovered after the warranty period has expired and they become the person writing the checks for repairs.

When choosing a home inspector to review your

Reason #1 Some items are incomplete. This ranges from incomplete wiring and plumbing connections, appliance installs, missing parts from doors and windows.

Reason #2 No one has lived in the home yet. Many builders tout their “quality control,” yet home inspectors are often the first person to thoroughly test the

new home, make sure you select an inspector who specializes in new home inspections.

That way, the inspector should inspect to the workmanship standards which differ from those

all liens and encumbrances from the fair market

inspections please contact us. We’re happy to help.

Inspections, Inc. in Scottsdale and has been performing home inspections since 1994.

Minimum Workmanship Standards. There are

cracks, cabinetry, flooring, drywall, paint, and roof tiles, etc. The builder is required to meet these standards, a good home inspector will help

$150,000 of equity in a person’s dwelling is

If you have any questions about new or resale

very limited in both time and scope.

Contractors that cover everything from concrete

of creditors. The law in Arizona provides that protected from “attachment, execution and

Paul Staron is owner of Valley Building

many standards set by the Arizona Registrar of

protection to homeowners against the claims

in a resale home inspection.

home and its systems. Municipal inspections are

Reason #3

Arizona’s homestead laws provide substantial

forced sale.” Equity is calculated by subtracting value of the homestead property. However, the homestead exemption does not apply to: 1) consensual liens, such as a mortgage or deed of trust; 2) a contractor’s lien for labor or materials arising out of the construction, alteration or repair of a home; or 3) to equity in excess of the homestead exemption. A.R.S. §

Paul Staron Valley Building Inspections, Inc. P.O. Box 14666 Scottsdale, AZ 85267 480-860-1100 Fax 480-860-2920

ensure they do!

33-1103.

The homestead exemption is available to any adult who resides within the state. A person who is entitled to a homestead exemption holds the exemption by operation of law and no written claim or recording is required. (Under prior law, a declaration of homestead had to be recorded.

This is no longer required.) A homestead property may be a home, condominium,

Tip

or mobile home. The key is that the person

Title

claiming the homestead must reside in the structure to which the exemption applies.

What Is Escrow?

Escrow opens when the buyer and seller sign

process that provides for a fair and equitable

a sales contract, commonly called a real estate

transfer of property from one person to another.

purchase agreement. The contract serves as instructions for the Escrow Officer.

Simply defined, an escrow is a deposit of funds, a deed or other instrument by one party for the delivery to another party upon completion of a particular condition or event. Escrow is a

Allison Hudgins, Branch Manager LandAmerica Transnation Title 602-996-0055

Kyle Brown Loose, Brown & Associates 11240 N. Tatum Blvd., Ste. 110 Phoenix, AZ 85028 602-971-4800 Fax 602-953-3621 kyle@loosebrown.com

REALTY EXECUTIVES

11211 North Tatum Boulevard, Suite 130 Phoenix, AZ 85028 602-996-9910 • Fax 602-926-1403

Meet the Ponté Team

Preferred Properties Address

Price

7510 N. Via Del Paraiso, Scottsdale 85258. . . . . . . . . . . . . . . . . . . . $439,000 4825 E. Daley Lane, Phoenix, 85054. . . . . . . . . . . . . . . . . . . . . . . . . $539,000 4701 E. Osborn Rd., Phoenix, 85018. . . . . . . . . . . . . . . . . . . . . . . . $689,000 12310 N. 78th St., Scottsdale, 85260. . . . . . . . . . . . . . . . . . . . . . . . . $824,900 347 W. Glendale Ave., Phoenix, 85021 . . . . . . . . . . . . . . . . . . . . . $1,300,000 6222 E. Turquoise Ave., Paradise Valley, 85253 . . . . . . . . . . . . . $2,295,000 Back Row: • Jack Luciano – Team Member • James E. Ponté II – Team Leader • Kelley Turner – Team Member Front Row: • Rebecca D. Ponté CRS – Team Member • Mary Dudley – Team Office Coordinator

6736 N. Silver Mountain Road, Paradise Valley, 85253 . . . . . . $2,495,000 12625 N. Saguaro Blvd., Fountain Hills, 85268 # 206 . . . . . . . . . . $875,000 # 201 . . . . . . . . . . $749,000 # 207 . . . . . . . . . . $899,000 # 202 . . . . . . . . $1,047,000 # 208 . . . . . . . . . . $749,000 # 203 . . . . . . . . . . $695,000 # 211 . . . . . . . . $1,175,000 # 204 . . . . . . . . $1,005,000 # 205 . . . . . . . . . . $695,000

Take a virtual tour at www.ponteteam.com.

Offfering subject to errors, omissions, prior sale, change or withdrawal, without notice and approval of purchaser by owner.