To Sell or Not to Sell….You do have options

The other day visited a friend and her husband who was feeling pressured to sell their house.   They recently joined their households and this house had been converted to a rental property.   The problem was that they were feeling pressured to sell because of Capital Gains laws.    According to the Capital Gains law, you must live in a home 3 out of the last 5 years that are preceding the year you sell the property in order to avoid Capital Gains.   This year will be the fifth year and they were feeling pressured to sell the house.    My question when we met was, œDo you really need to sell the house?   I know, kind of a strange question for a realtor, but my mission isn™t just to list and sell property.   My mission is to support your efforts to build your wealth or make your life simpler¦which ever is your priority at the time.  I created a detailed list of options including, selling now and possibly needing to bring money to the closing table, waiting until later in the year in hopes of the market improving, renting the house for several more years, or renting it out until the market improved, then selling it in a 1031 Tax Deferred Exchange.  With a 1031 they could sell the single-family house and purchase a 2 “ 4 multi unit for a profitable cash flow. I provided estimated œSellers Net Sheets for the different scenarios so that they could look at real $$$ numbers and compare the cost of continuing to rent the house or sell.  Afterward, I encouraged them both to review the list of options, then add or modify according to their thoughts and opinions. I suggested that they do this separately then compare each other™s changes.   I wanted them to have a clear picture of what their priorities were and what points they agreed upon or needed to discuss further.    

My friend is still deciding what is best for their unique situation and my thoughts were just a starting place. But unless you are in financial difficulty with a mortgage, the most important thing for EVERYONE to remember is that YOU HAVE OPTIONS.   Don™t be quick to think that everything is a dead-end road.  

FHA Loan Guidelines Update

Recently we told you about the proposed changes in FHA Loan guidelines.   I wanted to give you an update. The truly good news is that, so far, HUD is still allowing the Upfront Premiums to be financed.    I received the following from Christine Jensen, Cherry Creek Mortgage on February 20, 2010.   My many thanks to Christine for always providing us with current and valuable information.  

Christine wrote:  

Update. The Mortgage letter was issued by HUD yesterday.   I™ve attached a copy for your review.   I encourage you to read it in its entirety and let me know what questions this generates for you.  At this time, HUD has not mentioned that they will require that Upfront Premiums will need to be paid in cash.   For now, it appears that we can continue to finance this piece by adding it to the loan balance.

Christine Jensen, CMPS ®Branch Manager, Cherry Creek Mortgage Company

Arvada Branch7850 Vance Drive, Suite 160Arvada, CO 80003

Office: 303-456-4403Fax: 303-456-4429

Following is the letter she referenced:  

Friends,Today HUD announced anticipated changes to the FHA loan program.   I™ve attached their announcement for your review.   Please pay particular attention to the following important items: ·    

The  Upfront Mortgage Insurance Premium is being increased from its current level of 1.75% to 2.25%.   We are not yet certain of the exact implementation procedure which will be relayed in a mortgagee letter to be released tomorrow, but it may include the requirement that the upfront premium be paid in cash rather than allowing it to be financed.   We will know more tomorrow.    The   Seller concessions are reduced from 6% to 3%There are other changes announced, all of which Cherry Creek Mortgage currently meets or practices.   Please read the attached documents carefully and let me know what questions they generate for you.Let™s use this as an opportunity to get the word out to all our buyers that this is, indeed, and excellent time to buy a home of their own!

Endless Opportunities

There are endless opportunities when investing in real estate, a few of which are:

*           Buy with a 3.5% FHA loan “ 2 years later refinance & buy a 2nd multi-unit with 3.5%

*           Live-in for 2 years “ rent for 3 years- sell within 5 years = Pay no Capital Gains

*           Retirement?   Purchase with a Reverse Mortgage and collect rents

*           Plan for the future (Buy & live-in, follow your career & have a Colorado            

                       home to return

Once you have purchased and seasoned your investment you have many new opportunities for building wealth such as:

*           Condo the units and increase profits

*           Buy a Victorian or Denver Square that is divided into units and restore to a single family

*           1031 Exchange “ Defer Capital Gains “ More buying power

My job as your Real Estate Partner is to help you find the best property to accomplish your short and long term goals.   I am with you from start to finish; purchase, management to build wealth, and helping you increase your portfolio.  

Introduction to Investors

After 20 years of experience providing real estate services there are still two moments that make my toes tingle and reaffirm to me that I Love My Job.   The first is when I know that a family has purchased their dream home or a home that they thought would never be possible.   The second is when I help a family or an investor build their wealth through real estate investment.  

Welcome to Micki Carwin's Blog!

Welcome to Micki Carwin’s Blog! This blog will provide you with valuable information, tips, and general insight into the real estate market in Arvada. Visit my website at