By definition Homestead exemption is a legal tenant designed to protect the value of the homes of residents from:
• Property taxes
• Creditors
• Forced sale following the death of the homeowner spouse

To be eligible for homestead one must live in a state where the exemptions are available, Georgia is a state that offers this exemption. The home must be listed as the primary residence, but some of these residences are not eligible because limitations on the value of real property.

Homestead tax exemptions are not tax cuts, but rather result in a shifting of tax burden. The Homestead Exemption shifts burden from less expensive homes to more expensive homes, as well as to non-residential property. For example you may claim an exemption for your primary residence, but a home you use as a rental cannot be claimed.

You may apply for homestead exemptions on your principal residence. Homestead exemptions remove part of your home’s value from taxation, so they lower your taxes. An example is this, your home is appraised at $100,000, and you qualify for a $15,000 exemption (this is the amount mandated for school districts), you will pay school taxes on the home as if it was worth only $85,000. Taxing units have the option to offer a separate exemption of up to 20 percent of the total value.

While exemptions vary, several common exemptions are:

• School taxes: All residence homestead owners may receive a homestead exemption from their home’s value for school taxes.
• County taxes: If a county collects a special tax for farm-to-market roads or flood control, a residence homestead owner may receive an exemption for this tax.
• Optional percentage exemptions based on age or disability: Any taxing unit-including a city, county, school, or special district-may offer an exemption base on a home’s value.

It is important to check not only with the rules and regulations for your state as well as your county and city requirements to file the appropriate homestead forms. Some houses are rendered ineligible for many reasons and this fact is often listed on the houses listing sheet so be sure to ask your realtor if you are buying a new home.

You have found the house of your dreams! It’s in the right price range and has everything you have been looking for. You’ve got an offer on your house, things are running smoothly. You sign the papers on your dream house and then your buyer backs out. Dream turned nightmare, right? This would be a good time to consider a bridge loan.

What is a Bridge Loan?

Bridge loans are temporary loans to cover the difference between the sales price of a new home and a home buyer’s new mortgage if the old home hasn’t sold. The bridge loan is secured to the buyer’s existing home. The loan is then used as a down payment on the new home.

Many banks that offer bridge loans do not go by a FICO rate but more a sensible underwriting approach that hinges on the prequalification of the second home’s loan rate. (In other words, did you qualify for more than the amount of your new home or are you just barely making it. What is your debt to income ratio?)

Pros and Cons:

The Pros
• You can immediately put your house on the market.
• Bridge loans often have a grace period, without payments, for a few months.
• If the buyer has made a contingency offer to buy and the seller issues a Notice to Perform, forcing the buyers hand, the buyer can move forward still move forward with the purchase without the contingency.
• It allows you to get your new home without the stress of waiting on the sale of your old one.

The Cons
• Bridge loans cost more than home equity loans.
• Buyers will be qualified by the lender to own two homes and many buyers cannot qualify for this.
• You will essentially have two mortgage payments PLUS interest. Not the best situation for the long term.

Bridge loans are not meant to be long term, so in some cases taking out a home equity loan on your existing house for the down payment on your new home may be a better course of action. If your house sells within a month or two, you may need to make only one small payment before it closes. At closing you’ll pay off the home equity loan and be done with it. Essentially, you will have crossed the bridge before you even got to it.

Record-high gas prices are forcing people to stay closer to home instead of driving or flying long distances for their summer vacation. That does not mean any shortage of fun however, the Atlanta area is full of fun things to do with something for everyone! With a little planning you can create a fun and relaxing destination in your own backyard. Below are just a few of the wonderful attractions you can enjoy in our area.

Zoo Atlanta Exhibits and Events
800 Cherokee Ave. SE, Atlanta, GA Phone: 404-624-WILD

Located in historic Grant Park, minutes from downtown Atlanta and Turner Field, Zoo Atlanta is one of Georgia’s most loved institutions. Founded in 1889, it is one of the 10 oldest zoos in continuous operation in the United States.

World of Coca Cola
121 Baker St. NW, Atlanta, GA Phone: 404-676-5151

The World Of Coca Cola is the only place where you can explore the complete story—past, present, and future—of the world’s best-known brand!

Georgia Aquarium
225 Baker Street, Atlanta, GA 30313 Phone:404-581-4000

With eight million gallons of fresh and marine water and more aquatic life than found in any other aquarium, you are sure to see things you have never seen before.

CNN Center
Take an interesting “behind the scenes” peek at the frenzied world of television journalism with the CNN Studio tour.

With the large inventory of foreclosed properties, many people are purchasing these homes at discounted prices. Keep in mind it is important to watch the tax prorations when buying foreclosed properities. Below are some tips and guidelines you should follow if you are considering making such a purchase.

1. Look at the 2007 tax info on county web site – was there homestead exemption? Any other exemptions?

2. When was the property foreclosed? If in 2007, there will be no homestead exemption discount for 2008, because the lender owned the property on January 1st.

3. Can you find out the 2008 assessment? Check with the county to determine if there is a new assessment for 2008 and if it is higher than last year.

4. If the 2008 tax bill is not out yet, the closing attorney will prorate the 2008 taxes on an estimate. If there is a new assessment or if the homestead discount has dropped off for 2008, the prorations should reflect this.

5. The seller will pay the prorated share of the ESTIMATE for the 2008 taxes. Make sure that the best estimate is used.

It is important to know if the 2008 bill comes out much highter, there is unfortunately no recourse to the REO seller for the difference. It is always a good idea to check with a real estate attorney for more information and advice.