In this real estate market with declining prices, short sales have become a common vehicle for sellers who are “underwater” on their mortgage.   In the event your lender agrees to allow a short sale of your home, there are things you need to know to protect yourself.  

If your mortgage debt is partly or entirely forgiven during tax years 2007 through 2012, you may be able to claim special tax relief and exclude the debt forgiven from your income.  Here are 10 facts the IRS wants you to know about Mortgage Debt Forgiveness.

1.  Normally, debt forgiveness results in taxable income.    However, under the Mortgage Forgiveness Debt Relief Act of 2007, you may be able to exclude up to $2 million of debt forgiven on your principal residence.

2.  There is a limit of $1 million for a married person filing a separate return.

3.  You may exclude debt reduced through mortgage restructuring, as well as mortgage debt forgiven in a foreclosure.

4.  To qualify, the debt must have been used to buy, build or substantially improve your principal residence and be secured by that residence.

5.  Refinanced debt proceeds used for the purpose of substantially improving your principal residence also qualify for the exclusion.

6.  Proceeds of refinanced debt used for other purposes – for example, to pay off credit card debt – do not qualify for the exclusion.

7.  If you qualify, claim the special exclusion by filling out Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness, and attach it to your federal income tax return for the tax year in which the qualified debt was forgiven.

8.  Debt forgiven on second homes, rental property, business property, credit cards or car loans does not qualify for the tax relief provision. In some cases, however, other tax relief provisions – such as insolvency – may be applicable. IRS Form 982 provides more details about these provisions.

9.  If your debt is reduced or eliminated you normally will receive a year-end statement, Form 1099-C, Cancellation of Debt, from your lender.  By law, this form must show the amount of debt forgiven and the fair market value of any property foreclosed.

10.  Examine the Form 1099-C carefully. Notify the lender immediately if any of the information shown is incorrect.  You should pay particular attention to the amount of debt forgiven in Box 2 as well as the value listed for your home in Box 7.

For more information about the Mortgage Forgiveness Debt Relief Act, visit IRS.gov

Please visit our short sale website www.highlandsncshortsale.com  for more information on navigaqting the short sale process.    Our website at http://www.meadowsmtnrealty.com/default.asp.pg-ForeclosuresShortSaleListings will give you an insite into the foreclosure/short sale properties in Highlands NC, CashiersNC, Glenville NC and Sapphire NC.

In these uncertain economic times, many Americans are living from paycheck to paycheck, often extending themselves even further through credit card debt.     For owners who can no longer afford to keep mortgage payments current, there are alternatives to bankruptcy or foreclosure proceedings.   One option is a real estate short sale.   

 To help understand how a short sale differs from a foreclosure, it may be helpful to point out that short sales can also be referred to as “pre-foreclosure sales” which, as the name implies, precedes the home being officially repossessed or foreclosed on by the lender.

When lenders agree to do a short sale in real estate, it means the lender is accepting less than the total amount due.    Banks grant short sales for two reasons: the seller has a hardship, and the seller owes more on the mortgage than the home is worth.    It might seem counterintuitive for a lender to go along with a short sale. After all, a lender is legally entitled to pursue the full balance of the loan.   Foreclosure is an expensive and time-consuming process for a lender.  By agreeing to a short sale, the lender wraps up this little mess quickly, and perhaps with less of a loss than it would have incurred with a foreclosure.

Remember, after foreclosing, the lender owns the home and has to maintain it, insure it and pay taxes on it.  So instead of receiving payments each month, the lender is now forking out money every month.   Plus, short sales help the lender look good on paper — the property never gets listed as an actual foreclosure, which helps the lender’s numbers look better to bank regulators.  They see it as the lesser of two evils — if the numbers make sense for them.

 It should be noted that there are still negative implications for sellers in a short sale, even if less damaging than those associated with foreclosures and/or bankruptcy.  For example, a short sale homeowner’s credit will still be adversely affected by settling with the lender.   However, short sales do carry less negative effects than foreclosures.   Short sale sellers are widely seen as less risky than foreclosed sellers.   Case in point, Fannie Mae recently adjusted their guidelines to dictate only a two year waiting period for a short sale seller to buy another primary residence, while they extended the waiting period for foreclosures to five years.

Except for certain conditions pursuant to the Mortgage Forgiveness Debt Relief Act of 2007, be aware the IRS could consider debt forgiveness as income, and there is no guarantee that a lender who accepts a short sale will not legally pursue a borrower for the difference between the amount owed and the amount paid.   I suggest that all borrowers obtain legal advice from a competent real estate attorney and call their accountant to discuss short sale tax ramifications.  

At its best, a short sale can be a win-win for both parties. For the seller, a short sale provides the opportunity to avoid foreclosure and the dreaded implications that a foreclosure brings, in addition to being able to return to home ownership sooner.  For the lender, a short sale attains most of the value of the loan sooner, and avoids incurring additional legal or carrying costs while the foreclosure process plays out, which can sometimes even take years.  

And, frankly, short sales are great options for savvy buyers.   The short sale process is still a mystery to many people, even after all these years.  Lots of buyer’s agents are confused; puzzled buyers are looking for direction, and not every short sale listing agent knows how to do a short sale.     Two of our agents at Meadows Mountain Realty are experts in short sales.  Tammy Mobley received the coveted Certified Distressed Property Expert (CDPE) Designation in 2009 and Tom Goldacker completed the Short Sale and Foreclosure Course earlier this year to receive his SFR Designation.   

If you are considering buying or selling a home in a short sale situation, call the experts at Meadows Mountain Realty at 828-526-1717 or stop by our office at 450 N. 4^th Street in Highlands.   We can also be reached by email at info@meadowsmtnrealty.com.

Cashiers North Carolina offers many different options for private community living, one of which is Trillium.  Trillium is so much more than a golf course community, offering a lifestyle and amenities that span a multitude of ages and interests.

Trillium is located on Lake Glenville and offers everything from an 18 hole championship golf course (designed by Morris Hatalsky), boat slips and boat rentals,  to a fitness center, restaurant and more.  Owning a home in Trillium allows residents to escape to an effortless lifestyle that allows ample opportunities to enjoy the beautiful setting that Cashiers NC provides.

Of course owning Trillium real estate is a golfer’s dream, but the non-golfer can be satisfied as well.  If you are interested in fulfilling your dream of owning a home in a private community in Cashiers NC, the community of Trillium might be just what you are looking for.  Contact us, the brokers at Meadows Mountain realty, today to look at Cashiers NC real estate and the lifestyle that is available here.

For more information about Highlands and Cashiers North Carolina, and for access to the Highlands/Cashiers NC MLS, contact Meadows Mountain Realty today, 866-526-3558 or email us today at info@meadowsmtnrealty.com.

Lake Glenville is a wonderful place to enjoy the splendor of Western North Carolina

Lake Glenville is an ideal spot for those who love the mountains and the water.  The lake is the highest man-made lake east of the Mississippi River and offers ample fishing and boating opportunities.  Glenville, the town of the same name, is a beautiful community, offering all of the peace and splendor of its environment and the charm and history of a historic North Carolina mountain town.

Lake Glenville is an asset to the southern Blue Ridge Mountains which is accented by the nearly 80 acre open space area, Ralph J. Andrews County Park.  The park is an amazing recreational facility which offers hiking, camping, picnicking, boating, fishing and more.  If you have been looking for the ideal North Carolina mountain getaway it might just be in Glenville North Carolina.

For more information about Lake Glenville and real estate opportunities that exist there, as well as access to the Highlands NC MLS, contact Meadows Mountain Realty today, 866-526-3558.

The concept of a “media room,” as a space specifically devoted to home theater and audio systems, is more popular than ever. New home designers and builders, responding to the demand of their buyers, have incorporated media rooms into the floor plans of many new homes, all along the price spectrum. Such rooms are designed for comfortable television and movie viewing and are acoustically separated from the rest of the house.

Yes, the media room has also become the game room, again driven by homebuyer demand and a host of new (mostly electronic) toys. Builders are educating their buyers about the lifestyle advantages of including such a project and the value it adds to their property.

Consider some of the special features that a true Game Room encompasses, all of which are easily accommodated in a new construction project:

• Acoustics. Sound transmission in or out of a game room can be disruptive. Builders incorporate products that block or deaden sound through the walls, floors, and ceilings. Special membranes and laminated drywall and plywood panels meet the need without adding a lot of extra cost, rendering the Game Room almost a separate acoustical zone within the house.

• Light and shading. Everyone enjoys natural light … except when there’s a movie playing. Windows are a prime consideration that maintain flexible use of the room when the house is sold. The home’s exterior appearance must be considered, as well. To create the optimal movie-watching experience, builders turn to motorized screens and draperies that smoothly draw across the windows. Controlled by remote devices or wall-mounted panels, such screens retract into the wall when not in use or disappear into a subtle housing to retain the room’s overall aesthetic design.

• Multiple displays. One screen may not be enough in the modern Game Room. Though builders usually leave the purchase of consumer electronics up to the homebuyers after the house is finished, high-tech game rooms must be designed and wired to accommodate several displays and multiple signals. These may include satellite, wireless and wired Internet, cable, personal computers, and (don’t forget!) electricity.

• Seating, storage, and snacks. Like its media room predecessor, the new Game Room is a gathering place for family and guests, often engaged in multiple activities at the same time. Space for several zones of comfortable seating is very popular, as is built-in cabinet storage for all of the game players, audio and video equipment, and other components. Small kitchen setups, complete with sink, under-counter appliances, and counter work space, provide family and guests with additional convenience in this self-contained haven.

Media rooms are among the new wave of distinct, specialized areas within today’s new homes. The “Game Room” reflects the development of high-tech consumer electronics and the consumers’ desire to maximize enjoyment of these new toys.

This article was contributed by Zac Koenig of Koenig Homebuilders in Highlands.

After the structural framing stage and the installation of the preliminary — or “rough” — plumbing, electrical, and heating and cooling components are complete, there is a no-name phase of construction we’ll call the “prefinishes.”

The reason this stage of the process has no common name is because several different activities — by several different trades — occur during this time. All of them combine to prepare the house for the finish products to come, from flooring to trim to lighting, and are vital in the overall performance of the house. Indeed, the sum of these prefinishes is called the “thermal envelope.” These critical steps include:

Housewrap. Also called an air or vapor barrier, this tough, woven sheet-like material is installed on the exterior walls around the entire house. Sections are fastened and taped together to keep water and air outside the structural frame. Housewrap protects the “thermal envelope,” improving the home’s energy efficiency and indoor comfort. The wrap covers the rough openings of the windows and doors. Once it is installed, we carefully cut out those openings and fold the material around the rough openings to ensure complete protection from the elements.

Windows and doors. Once the housewrap has been cut to expose the rough frame openings, we carefully install each window and door. Attention to detail is critical at this stage to make sure that the windows and doors not only operate smoothly and properly, but also deliver maximum thermal benefits. Good quality windows and glass patio doors are now designed for improved control of thermal transfer, solar heat gain, and harmful ultraviolet rays.

A home’s main entry door is often a signature feature of the house. Depending on the home’s design, the entry door might include windows on one or both sides (sidelights) or over the top of the door (transom), or perhaps even a glass insert in the door itself. These design elements add character to a home’s design and heighten curb appeal.

After the drywall is hung, we install the garage door(s). Like windows and passage doors, garage doors have come a long way in their design options and insulating value.

Insulation. Insulation is typically installed in the exposed framing cavities of the exterior walls. Good quality insulation retards the transfer of warm and cold air through the home’s structure. Insulation makes the home more energy efficient and comfortable inside.

Different insulation products are sometimes used for different sections of the house. In the walls, for instance, formed batts of fiberglass insulation are designed to fit snugly between the studs. In the attic, a loose-fill (or “blown”) insulation is often more appropriate to pack the spaces between the roof framing. An expanding, spray-applied foam might be most appropriate in the slight gaps between the window and door frames and their rough openings to seal the house more completely against air infiltration and thermal transfer.

Drywall. The last of the “prefinishes” is drywall, or gypsum wallboard panels. These familiar panels are cut to fit and fastened to the framed walls and ceiling, creating a smooth surface and substrate for paint, paneling, wallpaper, and other finishes. (The floors have a wood substrate called “subflooring,” which is installed during the framing stage of construction.)

Because whole and cut sections of drywall panels are pieced together, the seams between the sections must be filled and smoothed before the wall or ceiling finishes are applied. Taping the drywall joints is a process that requires several days, as multiple layers of “mud” are applied and sanded to deliver a smooth and uninterrupted substrate with no visible joints between the panels.

The completion of the “prefinish” stage creates the home’s thermal envelope, fully protecting it and its occupants from the elements and from thermal transfer through the exterior walls and openings.

One of the best builders in the area is Zac Koenig of Koenig Homebuilders.   Zac contributed this article to our blog and can be reached at 828-526-4953.   We have a complete list of preferred builders on our website.

Please give us a call if you would like assistance in finding the perfect spot on The Highlands Plateau for building your second home, weekend retreat or a place to live year round.  There is a great selection of homesites available now at good prices.  Call Meadows Mountain Realty at 866-526-3558.

On July 6th the Jackson County Board of Commissioners held its final public hearing relating to the U.S. 441 “Gateway” Corridor ordinance.  The proposed ordinance concerns the plan for new developments on the five-lane corridor that serves as an entrance to the Great Smoky Mountains National Park and Cherokee; with this area still quite rural, the addition of water and sewer lines would change this necessitating an ordinance that would ensure the growth would be guided tastefully to keep the beauty of the area.  The county’s consulting attorney on land development matters, Michael Egan, offered an overview of the ordinance to the public on July 6th which outlined the end goal for the corridor, including architectural standards, preservation of views and farmland, and limits on the billboards and other related aesthetic criteria for the new developments.  Responses from the public were generally positive with some criticize resulting from billboard rules.

For more on the 441 Corridor plan or ordinance, visit The Smoky Mountain news online.

For more information on mountain living and real estate in the Highlands, Cashiers, Glenville or Sapphire NC area contact your local agents at Meadows Mountain Realty today.

Closing costs are simply the fees associated with          

1) purchasing a home,

2) borrowing money, and

3) preparing paperwork to finalize the sale.

Your total closing costs will vary depending on where your new home is located, what type of property you are buying, the price of your home and the complexity of the transaction.

It is extremely important that you work closely with your buyer’s representative in the early stages of your home search to estimate what these costs could be, since closing costs can easily represent thousands of dollars.  The main categories are:

Discount points to buy down the mortgage
If you want to reduce the ongoing cost of your mortgage over the life of the loan, you’ll want to consider this optional fee. Amounts can vary significantly, from 0.5 to 3 points on the total mortgage amount. This is a one-time charge that is fully deductible as mortgage interest.

Costs for originating the mortgage
This generally includes a variety of fees such as the loan origination fee, the appraisal fee and the cost of credit reports. Other related closing fees may include hazard and mortgage insurance, and interest accrued on the mortgage between closing date and the end of the month.

Taxes and other local fees
Charges will vary according to local government requirements.  Generally, property taxes will be pro-rated according to the closing date.   Tax bills for the current year do not come out until late July or early August, are due when assessed, but not past due until January 1st of the following year.    If your closing takes place before tax bills and the tax assessment for the current year has not been determined, then the attorneys will prorate the taxes based on the previous year amount.   You may also be required to pay personal property taxes, homeowner’s association dues, and other assessments that are specific to the area where you are buying.

Documentation costs
In North Carolina, closings are handled by an attorney, not a title company.  As a buyer, you will have to pay for any research involving public records and title history for your new property.  This insures that the title is unencumbered by other ownership claims or liens and can be delivered to you at closing. It is the responsibility of the buyer to pay for the title examine, opinion of title and the title insurance plus the preparation of their own HUD Settlement Statement.   The attorney fees and other costs include recording and transfer fees, which cover legally recording the deed to your name.    The seller pays for the preparation of the deed, the revenue stamps on the deed, and their own HUD Settlement Statement. 

For questions on closings and closing costs, please contact Nadine Paradise at Meadows Mountain Realty.  Nadine can be reached at 866-526-3558 or via email at nadineparadise@nctv.com.   Nadine has years of experience in working with clients who are buying real estate in Highlands, Cashiers, Glenville and Sapphire North Carolina.   She can help you find your perfect home in the mountains of western NC.

For a determined group of Jackson County NC residents, a dream will finally be coming to fruition.  Since 2000, when the Greenway Commission was formed, its committee members have dreamed of making a ‘greenway,’ or path that would span from one end of the county to the other; this path would go from Cashiers to Whittier and would pass through each community and town through the county and use the Tuskasegee River corridor as its anchor, as reported in the Smoky Mountain News.

Committee members hope that this greenway will give families a place to safely bike, hike, and just enjoy the natural beauty of the area as well as preserve it for future generations.  Some questions that have come up include whether the trail should be dirt, gravel, stone or wood, where the entrances should be, and in what order should they be completed.  All these questions and more will be posed to the public in a series of public workshops this month for residents to vote their opinions.  The first part of the greenway will be under construction starting next month with a sidewalk between Sylva and Dillsboro and a trail through the Mark Watson Park.

For information on real estate with great mountain views in Jackson County NC including Cashiers, Highlands, Sapphire, and Glenville contact your local realtors at Meadows Mountain Realty today.

When we hear the term “green building,” most of us think of energy efficiency and healthy indoor air quality.  While those are certainly central components of high-performance housing — especially given our nation’s current energy prices — they are not the only factors that ensure a truly sustainable approach to home building.

One of the lesser-known aspects of green building is resource management. Meticulous resource management has a tremendous impact on a sustainable environmental future.  Builders need to reduce the amount of natural resources required to build homes and second, to recycle the amount of waste ordinarily produced during construction which is hauled away to the landfill.

Here is some startling data. Approximately 40% of the raw materials consumed in the U.S. are used in construction.   Residential building, renovation, and demolition account for about 58 million tons of trash per year, representing 11% of the country’s overall waste stream.

What can builders do?  Wood, drywall, and cardboard (from packaging), by weight and volume,  make up 60-80% of job site waste.  Other common building materials, such as concrete and metals, are also found in significant amounts. 

Reduce. The most obvious way to manage construction waste is not to create it in the first place. To that end, builders can practice a variety of methods that limit the amount of wood, drywall, and other products that go into a new home without sacrificing its performance, durability, or comfort.

For the structural frame, some builders, like Koenig Homebuilders implement “advanced” framing techniques using engineered wood products or factory-built (and quality-controlled) roof, floor, and wall components to lessen the amount of wood needed for the project.  To reduce the amount of drywall, builders need to be very precise about how much material is needed and train crews and subcontractors to install it properly. 

Architects can also help, by designing houses on room-size measurements that match the dimensions of 4×8 or 4×12 drywall panels. In that manner, when a panel is cut, the remaining piece can likely be used elsewhere instead of thrown away.  Cardboard is a tougher problem, because it is a common packaging material for a wide variety of products, large and small. (Think of major appliances and cabinets!).  ALthough a builder does not have direct control of cardboard use, they can work with suppliers to reduce or eliminate the cardboard they use for packaging and encourage them to pick it up for recycling.

Reuse/Recycle. The market for materials that can be reused and/or recycled is growing rapidly along with the green movement.   For example, lumber can be chipped along with lot-clearing debris and turned into mulch; drywall can be used as a soil amendment; concrete can go into road bed material; and cardboard can go to recycling centers.  An increasing number of businesses with specialized equipment are available to perform these functions.

In addition, builders should also look for high quality products with recycled content.  By using these products, builders can take advantage of the latest science for the benefit of our homeowners while encouraging the growth of industries practicing sustainability. The goal: homes of the highest quality for owners and a brighter, safer, and more sustainable future for all of us and generations to follow.

Most builders on The Highlands Plateau strive to keep our communities clean and green.  In Highlands and Cashiers NC, we are blessed with some of the most beautiful scenery in the country.   Lush forests, sparkling lakes and rivers, spectacular mountain vistas draw visitors and from across the southeast.   

When you decide to build your perfect mountain retreat, we hope you will choose a builder that respects the environment.  

Contributed by Zac Koenig of Koenig Homebuilders and can be reached at 828-526-4953.   We have a complete list of preferred builders on our website.