Most California Short Sales Won’t Owe State or Federal Income Tax for Cancellation of Debt
On December 4, 2013, the Franchise Tax Board issued a letter stating that because short sales are nonrecourse, they are not subject to state income tax that typically come from cancellation of debt. This is very timely information as the 2007 Federal Mortgage Debt Relief Act currently expires at the end of 2013. This decision comes as a result of California Code of Civil Procedure 580e which provides that most short sale sellers of residential property will not owe any deficiency at the end of the short sale.
This decision is in line with the letter issued by the IRS last month stating that the cancellation of debt doesn’t result in income tax because personal liability is forgiven.
Although, short sale sellers may be able to avoid paying tax on cancellation of debt, they still may owe capital gains as a result of the sale. A principal residence has exceptions for a married couple up to $500,000 or $250,000 for single tax payers.
This is truly important information for distressed home owners and may provide some piece of mind as they go through difficult times and decisions.
This information is not intended as either tax or legal advice, and all interested parties should consult their tax or legal representatives for details on their specific situation.
Fashion Island Tree Lighting Ceremony 2013
On Friday, November 15, and Saturday, November 16, 2013, Fashion Island will be having its annual Christmas tree lighting ceremony.
This event is free and will take place in the Neiman Marcus Bloomingdale’s courtyard.
It will be hosted by Mickey Mouse and his friends from Disneyland. The tree is a 90 foot extravaganza.
Every night at 5pm beginning on Sunday, November 17 and continuing through January 5, 2014, the tree lights will come on at 5pm.
Along with the Christmas tree, come enjoy the magic of Santa and his helpers. Why not come take a picture with Santa and have the kids tell him what they’re hoping to find under the tree while enjoying everything else that Fashion Island has to offer.
Your Realtor’s Critical Role
In Your Real Estate Transaction
What’s with the List?
Many surveys show that neither home owners nor home buyers realize the true value they obtain from their Realtor® during their real estate transaction (their Realtor’s Critical Role). As Realtor®s, we often assume that our hard work and expertise is seen, understood and appreciated by our clients. This disconnect happens because so much of what happens during a real estate transaction is “undercover” and never seen by our clients as we work to make the transaction as seamless as possible. With this magazine, we seek to bridge the gap that frequently occurs here. So, on the following pages, we have listed more than 200 of the usual tasks that a Realtor® completes and/or oversees during your real estate transaction.
Though this list is not complete, as different transaction require different services and tasks, the list will give you an idea of the undercover items in addition to the ones that most clients would typically see. Some of these items may take only a few minutes to complete while others may take days to do properly.
- Make appointment with seller to give listing presentation
- Send seller a written or e-mail confirmation of listing appointment and call to confirm
- Review pre-appointment questions
- Provide Pre-Sale Kit to seller
- Research all comparables currently listed properties
- Research sales activity for the past 6 months from Multiple Listing Service (MLS) and public records
- Research “Average Days on Market” for similar properties
- Download and review property tax roll information
- Prepare Competitive Market Analysis (CMA) to establish fair market value.
- Research property’s ownership and deed type
- Research property’s public record information for lot size
- Research property’s current use and zoning.
- Verify legal names of owner(s) in county’s public property records
- Prepare listing presentation package with above materials and MLS information
- Perform exterior “Curb Appeal Assessment” of subject property
- Compile and assemble formal file on property
- Review listing appointment checklist to ensure all steps and actions have been completed
- Listing Appointment Presentation
- Tour subject property with seller, reviewing interior and exterior conditions; obtain information about best features of property, past repairs and defects if any
- Give seller an overview of current market conditions
- Present company’s profile and position or “niche” in the marketplace
- Present Comptetive Marketing Analysis (CMA) results to seller, including comparables—solds, current listings, in escrow
- Offer pricing strategy based upon professional judgment and interpretation of current market conditions
- Discuss goals with seller to help market effectively
- Explain benefits of MLS
- Explain market exposure resulting from Zillow.com and other websites
- Explain the works that brokerage and agents do “behind the scenes” and agent’s availability evenings and weekends
- Explain agent’s role in pre-screening buyers and protecting seller from wasted time due to “looky-loos”
- Present and discuss strategic master marketing plan
- Explain different agency relationships
- Review and explain all clauses in Residential Listing Agreement and answer any questions.
- Obtain seller’s signature and provide a signed copy to seller
- Discuss commission structure and answer any additional questions
Once Listing Agreement is Signed
- Review current title information
- Determine square footage
- Obtain house plans if available
- Review house plans and make copy
- Prepare showing instructions for buyers’ agents and discuss with seller showing times and any other requirements seller may have for showings
- Obtain current mortgage loan statements for payoff purposes
- Verify current loan amounts
- Discuss possible financing alternatives such as seller carryback with seller
- Review most recent appraisal
- Obtain homeowner association (HOA) management contact information if applicable
- Verify HOA fees
- Request copy of HOA bylaws if applicable
- Verify security system (if any) as well as current term of service and whether equipment was leased or purchased
- Ascertain need for lead-paint disclosures (1978)
- Prepare detailed list for property’s amenities and assess market impact
- Prepare detailed list of property’s exclusions and inclusions for attachments to property
- Compile list of completed repairs and maintenance items
- Explain benefits of homeowner warranty to seller
- Have extra keys made for lockbox
- Verify if property has rental units included
- Determine leasing periods if applicable
- Obtain copies of leases, if any
- Verify all rents and deposits held by seller
- Inform tenants of listing and discuss showing instructions.
- Arrange for installation of yard sign
- Install lockbox
- Assist seller with completion of disclosure forms
- “New Listing Checklist” completed
- Review results of “Curb Appeal Assessment” with seller and provide suggestions to improve appeal
- Review result of “Interior Décor Assessment” and make suggestions to shorten market time
- Develop marketing plan with seller and provide copy once property is listed
- Discuss how offers are to be handled, particularly multiple offers
- Discuss possibility of dual agency
- Take multiple photos for MLS listings, websites and virtual tours
- Take videos of home and community
Entering Property in to Multiple Listing Service
- Prepare MLS Property Profile Sheet taking care for accuracy
- Enter data from Property Profile Sheet in to MLS
- Proofread MLS listing for accuracy
- Add property to company website
- Provide seller with signed copy of Listing Agreement and a printout of MLS listing within 48 hours; revise MLS listing as needed based upon seller’s feedback
Market the Listing
- Create print and internet ads with sellers’ input
- Determine and confirm dates for public and broker open houses
- Enter dates for broker and public open houses in to MLS and other websites
- Coordinate showing times with seller, tenants and other agents
- Return all calls regarding house promptly
- Prepare mailing and contact list
- Generate mail merge letters to contact list
- Prepare flyers and feedback faxes (if used)
- Ensure copies of marketing brochures are available at the property and in the brochure box if applicable
- Record 24-hour 800# hotline property information (if used)
- Email all contacts in database and current buyers regarding new listing
- Review comparable MLS listings regularly to ensure that property remains competitive in terms of price, terms, conditions and availability
- Prepare property marketing brochure for sellers’ review (for open houses and showings)
- Mail out “just listed” notice to all neighborhood residents; invite neighbors to open house via “gossip” cards
- Provide marketing data to buyers coming from referral network
- Submit ads to internet real estate websites
- Convey pricing changes promptly to all websites and MLS
- Reprint brochures as needed and re-supply
- Obtain feedback from buyers’ agents
- Discuss feedback from showing agents to determine if changes will accelerate sale
- Place weekly calls or emails to seller to discuss marketing, pricing, feedback and changes in the market
The Offer and Contract
- Receive and review all offers to purchase contracts submitted by buyer or buyers’ agents and ensure all information is included such as pre-approval letter and proof of funds
- Present all offers to seller, preferably face-to-face
- Counsel seller on all offers and answer all questions, including strength of offer and contingencies
- Contact buyer’s agent and buyer’s lender to discuss buyer’s qualifications and offer
- Request copy of pre-approval and proof of funds if they are not provided with offer
- Generate mail-merge letters to contact list
- Negotiate all offers on sellers’ behalf, including price, contingencies and close of escrow
- Prepare and send any counter offers or acceptance to buyer’s agent
- Once an offer is signed and accepted by buyer and seller, send copy to escrow
- Determine if property will still be shown now that it is “in escrow” and make necessary changes in MLS
- Confirm that earnest money is deposited into escrow
- Cancel any scheduled open houses, if necessary
- Deliver copies of fully executed purchase agreement to seller
- Advise seller how to handle any additional offers that come in after purchase agreement is fully signed
- Change MLS status to pending or backup
During Loan Processing
- Contact buyers’ lender to ensure that all necessary information has been provided.
- Follow loan processing throughout escrow to be kept up to date and be certain that timeline is followed.
- Contact lender weekly to see if loan is progressing.
- Keep seller informed of loan process and if there are any issues or delays.
- Relay final approval to seller once received.
- Coordinate buyer’s third party inspection of property
- Coordinate pest inspection if required by contract
- Review home inspector’s report and discuss with seller
- Review request for repairs and discuss and advise seller
- Negotiate request for repairs with buyer’s agent
- Determine if buyer is moving ahead with purchase after inspection and request for repairs
- Ensure seller’s compliance with home repair requirements
- Recommend or assist seller in finding trustworthy contractors to complete repairs
- Negotiate payment and oversee repairs on seller’s behalf
- Schedule appraisal with lender’s appraiser and accompany to property
- Provide comparable sales for review for appraisal as needed
- Follow-up on appraisal with lender
- Notify buyer’s agent that appraisal has been completed
Closing Duties and Preparation
- Verify contract is signed and initialed by all parties
- Coordinate closing process with escrow, buyer’s agent and buyers’ lender
- Ensure all required forms are received by all parties
- Confirm closing date and inform all parties
- Assist in solving any title issues such as death certificates and pay offs
- Work with buyer’s agent to schedule final walk through
- Request final closing figures from escrow
- Receive and carefully review preliminary closing statement for accuracy
- Review statement with seller
- Confirm buyer’s agent and lender have received title commitment
- Order homeowner’s warranty if applicable
- Coordinate closing with seller’s next purchase if applicable
- Refer seller’s to my nationwide network of Realtor®s if purchasing new home out of the area
- Change MLS listing to sold. Enter date of sale, price and other terms so that it can be properly used for comparable purposes
- Close out listing in MLS and office file
- Send thank you cards to buyer’s agent, escrow and other parties involved in transaction
- Follow Up After Closing
- Answer questions about anything that came up during closing
- Attempt to clarify and resolve any repair issues with buyer if applicable
- Respond to any follow-up calls from all involved parties
- Provide any additional information requested
Goathill Junction Scarecrow Festival and Pumpkin Patch 2013
On Saturday and Sunday October 12 and 13, 2013, Costa Mesa continues its 60th anniversary celebration with a scarecrow contest and pumpkin patch at Goathill Junction.
For more information about Goathill Junction, please see
In addition to the scarecrow contest, there will be train rides to the pumpkin patch and face painting as well as fire truck rides. The cost of the pumpkins is $4 each, and train rides are free. Children of all ages with pumpkin tickets will get to choose their own pumpkin and then turn it over to the conductor for the ride back to the station. Pumpkins can then be collected from baggage claim with your claim ticket. Plan for a train ride that is a little bit longer than the usual weekend ride to accomodate the pumpkin patch.
The festival will take place between 10am and 3pm both days. And, the winner of the Costa Mesa Scarecrow contest will be announced on Sunday at the Estancia Adobe as part of the celebration of Costa Mesa history. Be sure to come out and take a look at the scarecrows. There is a lot of variation and creativity, and some really cool scarecrows.
There will even be the opportunity to make paper rockets and launch them in to the sky.
There is so much to do here and enjoy Costa Mesa and what it has to offer.
Please let us know what you did and which scarecrow was your favorite.
Costa Mesa History at the Estancia Adobe October 2013
On Sunday, October 13, 2013, the Costa Mesa Historical Society will be hosting an event at the Estancia Adobe. It will take place from 12pm to 4pm and will feature information on how previous residents of Costa Mesa lived and will include a presentation from a Acjachemen Nation descendent.
The Diego Sepulveda adobe known as the Estancia Adobe was built around 1820.
There will also be awards for the winner of the Costa Mesa Scarecrow contest which are displayed in Fairview Park near Goathill Junction and the miniature trains.
Costa Mesa Miniature Trains to Keep on Rolling
This week, Costa Mesa City Council voted to extend Goathill Junction’s lease for another 5 years allowing the popular miniature trains in Fairview Park to continue to delight children, young and old.
The Orange County Model Engineers (OCME) have run the Goathill Junction miniature trains in Fairview Park since 1988. There are about 100 members of OCME and have invested about $750,000 into building and maintaining the railroads in Fairview Park over the past 25 years. The trains have given about 40,000 rides per year for the past two and a half decades.
The trains are open to the public on the third weekend of each month, and the rides are free though donations are accepted happily.
The trains celebrate the holidays with a Pumpkin Patch Run where a pumpkin can be chosen from the patch for a small donation and a visit to the North Pole at Christmas time with a photo of St. Nick on a decorated miniature train.
Each month when the trains run for their one weekend, children and parents line up for their opportunity to enjoy this special bit of Costa Mesa. The trains are available for rental for parties on their off weekends, and many children enjoy their birthday at Goathill Junction as a result.
For more information about Costa Mesa miniature trains, see:
If you are interested in selling or buying a home in Costa Mesa, please contact Chistine Donovan at 714-319-9751.
Eastside Costa Mesa Market Report – August 2013
This short video is an update on the current status of Eastside Costa Mesa Real Estate with a market report and an explanation regarding the numbers of homes for sale and recently sold. This is the type of information that many buyers and sellers need and want when they are trying to understand the current real estate market.
For a value of your house or to learn more about buying a home in Eastside Costa Mesa, please contact Christine Donovan at 714-319-9751
Orange County Fair 2013
It’s that time of year! If you’re thinking about chocolate covered bacon, deep fried butter and ferris wheels, then you’re ready for the Orange County Fair 2013!
I’ve loved going to the OC Fair for as long as I can remember whether it was the animals, the pig races, the rides, the exhibits or the food, it didn’t matter, I loved and still love all of it. These days I get to enjoy it with my own family. Please see The Orange County Fair through the Eyes of a Four Year Old.
How about you, what are your favorite memories of the OC Fair? Please let me know in the comments below.
OC Fair 2013 Details
The 2013 Orange County Fair runs from July 12 to August 11. It is closed Mondays and Tuesdays.
Ticket prices as follows:
Children under 6 – free
Children 6 – 12 – $6
60 and over – $8
Everyone else – $11
The fair is open noon to midnight Wednesday through Friday and 10am to midnight Saturday and Sunday.
Wednesdays- Unlimited wristbands. Cost is $30 and must be purchased before 5pm. Wristbands are good until 8pm. Also includes 2 free games.
Wednesday – July 17, 2013 – Free admission and one free carnival ride with donation of 5 cans of food. Good only between noon and 4pm.
Wednesday – July 24, 2013 – Free admission and one free carnival ride with donation on one new children’s book or 3 gently used children’s books.
Wednesday – July 31, 2013 – Free admission and one free carnival ride with donation five new or gently used clothing items.
Wednesday – August 7, 2013 – Free admission and one free carnival ride with donation of new school supply worth $5 or more.
Thursdays – Unlimited wristbands. Cost is $30 and must be purchased before 5pm. Wristbands are good until 8pm. Also includes 2 free games.
Thursdays – Admission for kids under 12 is free all day.
Fridays – $2 off for those 60+
$2 rides and $2 games from noon to 4pm
$2 Taste of Fair – noon to 4pm.
Saturdays and Sundays – $3 admission from 10am to 11am.
Active Military and Veterans are free each day with ID.
Children can earn 3 carnival rides by reading 2 books.
For more details please see OC Fair.