AB 980 (Calderon), Disclosure of Already Imposed Private Transfer Taxes, passed in the Senate Transportation and Housing Committee.  The bill will require a separate disclosure to potential home buyers as to whether the home they are considering purchasing requires the payment of a private transfer tax (PTT).

REALTORS® and the home buying public should be aware of a new form of fee being imposed on homebuyers.  Private Transfer Taxes, or PTT’s, are being incorporated into the contracts for the purchase of newly constructed homes in several new developments.  They are often written into a deed to trigger every time a home sells and have been seen as high as 1.75% of the sales price. 

The U.S. Congress is considering legislation on two issues of concern to REALTORS® in California.  H.R. 2834 would change how profits from the sale of a private equity partnership are taxed, in a way that increases the tax liability for general partners (GP).  The legislation would tax profits realized by a GP at income tax rates (currently up to 35%)  Profits realized by limited partners (LP) and initial investments by a GP would still be taxed at capital gains rates.

Congress is also holding hearing and preparing for an extension of the Terrorism Risk Insurance Act (TRIA).  Currently, TRIA is set to expire at the end of the year.  H.R. 2761 would extend TRIA for 10-years.

REALTORS® are in the business of helping people become homeowners and want to do everything they can to make sure you can afford to stay in your home.  If you are having trouble making your payment or have one of the loans that have been written about in previous articles, you may want to consider the following:

• The best and least expensive option will often be working with the current lender (or the “loan servicer” hired by the lender to oversee your loan).
• If your current lender is not willing or able to help, you may be able to refinance your current mortgage with another lender.  REALTORS® can help you find responsible lenders that make fair and affordable loans.
• To address the growing foreclosure problem, especially with subprime loans, some state and local governments and nonprofit organizations are offering financial assistance.  Ask your REALTOR® or counselor who to call.
• Counseling agencies are in the business of helping borrowers like you.
• Remember, you should shop just as carefully for a mortgage as you do for a car of anything else that you buy. 
• Sometimes the only option is selling the home.  Of course, no one is better at helping a seller than a REALTOR®.  It is better to sell than go through foreclosure because it will be easier to qualify for credit in the future and buy another home.
• Be wary of advertisements like “Cash for Houses/Any Situation” or “We Buy Houses for Cash.”  Consumer groups have learned that many of these are scams that bait homeowners with the promise of rescuing them from imminent foreclosure. Unfortunately, the “rescues” often involves the borrower signing over the house and the family being evicted from their home. (Source: NAR)