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Archive for the 'Tax' Category

What Is Mello-Roos and How Can It Impact California Home Buyers?

Depending on where your home search takes you within San Diego County and the state of California, Mello-Roos may or may not be a consideration.  So, what is it and why should you care?  The short answer is that it is a special tax on homeowners who live in a community that used bonds to pay for the infrastructure within that community.  The Mello-Roos is basically the repayment for those bonds.  When we take our clients around to view homes, Mello-Roos is often viewed as a four-letter word.  Are there advantages to living in a community with this tax?  This post will discuss both sides.

Mello-Roos, also known as the Community Facilities District Act (CFD), comes from the names of its co-authors.  Senator Henry Mello and Assemblyman Mike Roos were instrumental in getting this act passed through the California State Legislature in 1982.  It was developed in response to the passing of Proposition 13 in 1978 which made it more difficult for local governments to use property tax revenue for public facilities and services.  In searching for other options to pay for these services, Mello-Roos was created.  Who decides whether a community will have Mello-Roos?

The community in which this tax is considered decides.  The vote must pass in favor of becoming a Mello-Roos community.  Once the vote passes, bonds are issued to support services such as schools, roads, parks, utility connections, sewer, police, fire and life safety.  Mello-Roos is typically paid annually or semi-annually.  The amount and term length of this tax varies from community to community.  When you break it down on a monthly basis, we’ve seen it as low as $80 per month and in upwards of $400 per month.  The term length of Mello-Roos is, on average, between fifteen to twenty years from the year the community was built. Read the rest of this entry »

Tags: california, faq, home buyer, kaplan, mello-roos, nobullagent, prudential california realty, san diego

Is the First-Time Home Buyer Tax Credit Extension Necessary?

President Obama is expected to sign an extension, approved by the House and Senate, to the June 30 first-time home buyer tax credit deadline.  Why is this extension important and is it necessary?  The simple answer is “yes” to both questions.

The original timeline for the first-time home buyer tax credit, as detailed in our previous post, stated that a home buyer must be in contract by April 30, 2010 and close by June 30, 2010 to be eligible for the credit.  Many first-time buyers positioned themselves to take advantage of this credit which is evident by the increase in sales during the month of April.  The current challenge is getting some of these transactions done in the 60 days previously given between the two deadlines.  This timeline can be especially short considering short sales are still taking, on average, from four to six months to process.

There are many opinions as to why short sales take so long.  The general consensus is that lenders are playing “catch-up” to the mass influx of these transactions, are short staffed and are reworking their processing procedures on the fly.  This extension is important and necessary for these buyers who need the additional time, for no fault of their own, to complete their transactions.  Read the rest of this entry »

Tags: buyer, california, credit, extension, fraud, home, inmate, kaplan, nobullagent, san diego, Tax

$10,000 California Home Buyer Tax Credit Ending Soon? (Video)

Tags: $10000, california, home buyer, tax credit