Monday, October 28, 2013

New Mortgage Rules

A recent article release from Florida Realtors discusses whether the new mortgage rules are a positive change.  To read the article, click here, or read below.

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 A coalition of 51 consumer organizations, civil rights groups, housing organizations, lenders, real estate professionals and insurers – a group that includes the National Association of Realtors® (NAR) – issued a white paper supporting the latest version of Qualified Residential Mortgage (QRM) rules currently in comment period.

Following the mortgage meltdown, lawmakers and federal agencies looked for a way to make sure toxic loans no longer harmed the market. To do that, they focused one eye on the qualifications a potential homebuyer must have to get approved for a mortgage. At first, some of the proposals caused concern among Realtor groups who feared a second real estate meltdown if buyers had to follow strict new rules, such as a minimum 30 percent down payment.

However, a white paper issued by the Coalition for Sensible Housing Policy finds that the current proposed mortgage rules generally find a fair balance between protecting the U.S. economy without making homeownership unavailable to many Americans – it “effectively limits the risk of default without excluding large members of creditworthy borrowers.”

The Coalition will submit the white paper to regulators during the rule’s public comment period that ends Oct. 30.

Analysis by The Urban Institute, which looked at current loans and how they would have fared under the QM proposed rules, found that the proposed QRM would reduce the risk of default and delinquency by more than half:

• Loans purchased by Freddie Mac and Fannie Mae that met the re-proposed QRM standard had default rates of 4.1 percent compared to 8.7 percent for mortgages that did not qualify for QM status.

• The delinquency rate for mortgages in private label securities that did not meet the re-proposed QRM standard was 30.6 percent. The delinquency rate for purchase and refinance loans that met the new QRM proposal was nearly two thirds lower at 12.6 percent.

“In synchronizing the definition of QRM with QM, the revised rule will encourage safe and financially prudent mortgage lending, while also creating more opportunities for private capital to reestablish itself as part of a robust and competitive mortgage market,” the paper concluded. “Most importantly, it will help ensure creditworthy homebuyers have access to safe mortgage financing with lower risk of default.”

The white paper can be found online.
To read more about the Coalition for Sensible Housing Policy and its member groups, visit their website.

Friday, August 23, 2013

Condos in Orlando prices double in 3 years

A nice article was in the Orlando Sentinel this week regarding condo prices.  To read article, click here or see below. 
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Orlando-area condo prices have more than doubled in less than three years, a new report shows.
The median price for a condominium or townhouse in the four-county area during July was $104,000, according to a report released by Florida Realtors Wednesday. During 2010, the units traded for a median price of $50,400 -- making Orlando one of the cheapest condo markets in the state at the time.
"When the market went down so low, all of Florida was for sale," said Bethanne Baer, broker associate for Keller Williams Realty at the Parks. "The lenders have not been lending on units and the values dropped tremendously."
Real estate companies advertised cheap Florida condominiums to buyers in the Midwest and the Northeast, spurring a frenzy of cash buyers that quickly drove up prices from the market bottom, she added. By leasing out the units, many of the cash buyers were able to quickly get a 10 percent return. Historically, landlords have had to wait three years after purchasing a rental property before they might get a profit.

The Orlando-area condominium projects that have performed the best are established properties built before the real estate boom and bust, Baer added. Another issue has been that very few local condominium and townhouse developments have landed on the approval list for federal-backed mortgages -- killing buyers' chances of getting a loan. In many cases, she said, condominium associations have not filled out the paperwork required for the federal backing.
One area where condos seem to have struggled the most is the west Orlando community of MetroWest, which has had some crime issues.
Of all parts of the state, Orlando in particular experienced one of the most dramatic condo turnarounds. During just the last year, Metropolitan Orlando condo prices increased 29.5 percent during the last year while prices for Florida's 20 largest metro areas increased 22.9 percent. Statewide numbers do not reflect the most current Brevard County sales.
Consider that three years ago – during a time when darkened windows defined condo projects throughout the state – Orlando and Ocala had the lowest condo prices in the state. By July of this year, Orlando's condo prices had surpassed those of not only Ocala but also Gainesville, Tallahassee, Indian River County, Charlotte County, Polk County.
Boosted largely by relatively high-ticket condo prices in coastal counties, the median price statewide for the properties was $129,000 in July. The panhandle area of Okaloosa County, which includes Destin and Fort Walton Beach, had a median condo sales price of $202,000 during July – the priciest condo deals in the state.
mshanklin@tribune.com or 407-420-5538

Monday, July 1, 2013

Economic turns a psychological corner


An article from The Atlanta Journal - Constitution is a great discussion on the power of optimism in a struggling economy.  Have you noticed a difference in people's attitudes?  Enjoy the article.
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NORCROSS, Ga. – June 28, 2013 – For Rizwan Peera, the feeling hit when he spotted “Sold” stickers slapped on “For Sale” signs in his Norcross, Ga., neighborhood.

Lisa Tilt noticed that she was hearing fewer “yeah … but” conversations among other small business owners, conversations laced with statements like, “Yeah, we’re getting by, but you never know these days.”

Maya Miller noticed that the kids’ party business her husband created while he struggled to find a good job was fully booked every weekend.

Call them “exhale moments” – the point at which a person finally feels a loosening of that knot of dread that has gripped people’s gut since the onset of the economic downturn.

The past several months have generated enough good (if not great) economic news to change many people’s perception, economic experts say. Those people have turned a psychological corner, recognizing that while there is a long climb ahead – and periodic jolts in the stock market – they no longer feel as though they’re being swallowed by a giant sinkhole.

“We’re off the floor,” said Mercer University economist Roger Tutterow.

Or, to adopt Miller’s personal economic indicator: “I can now get my toenails done.”

The collective psychological shift could have major economic consequences, as people’s spending habits are often driven by their view of the economy, said James MacKillop, associate director of the University of Georgia’s Owens Institute for Behavioral Research.

“Certainly a lot of economic activity is predicated on optimism or pessimism,” he said. “You don’t throw yourself into a 30-year mortgage if you feel that things are unstable or that the future is perilous.”

For today, though, the change in perception has yet to translate into a major change in behavior, said Dorsey Farr, a partner in the Atlanta investment management firm French Wolf & Farr. Even though consumer confidence has grown, consumer spending continues to “muddle along,” he said.

“People feel a little bit better, but it is not showing up in a real significant change in personal spending,” Farr said.

That’s likely because much of the pain caused by the recession is still very much with us. Millions of people are still beset by long-term unemployment, depressed housing values and the residual effects of foreclosures, bankruptcies and government spending cuts.

Marsha Belflower has heard the good-news stories, but she’s hardly optimistic.

During the pre-recession boom years, she abandoned her career in social work and eventually opened her own spa. As the economy worsened, business drained away. Two years ago she started looking for another job, but the search so far has been fruitless. Worse, she had to shut down her spa last month.

“I’m kind of a lost lamb,” said Belflower, 39, of McDonough, Ga. “I am taking an emotional sabbatical.”

She can’t even go back to her former career, because many good social work jobs now require a master’s degree that she doesn’t have.

“I do not have the sense that the economy is improving,” she said. “My house is not worth more. It still takes $50 to fill up my two-door Honda. I lost my job and my business. No, I don’t see it.”

Numerous economic indicators, however, show the economy is moving in the right direction, though in fits and starts.

As a result, consumer confidence reached its highest level in five years this month, according to the Conference Board. But don’t get too jazzed: The nation’s other major gauge of consumer confidence, Thompson Reuters and the University of Michigan, recorded an unexpected dip in consumer confidence this month.

The push-and-pull pace of this recovery has created a kind of hybrid optimism, said Emily Sanders, managing director of United Capital Financial Advisers of Norcross.

People see improvement, she said, but can’t shake the lessons of the recession. They see that the local mall is no longer a ghost town, they see houses being built again, but they’re not ready to splurge on major purchases.

“You don’t hear anybody talking about ‘staycations’ anymore,” said Sanders, referring to the term used for stay-at-home vacations. “People are not staying home, but they may not be taking as expensive a vacation as before.”

People make all kinds of decisions based on the economy, experts say: whether to get married, have kids, get divorced. Entrepreneurs gauge the economy when deciding whether to start or expand a business.

Peera, having seen the real estate market in his neighborhood improve, decided it was time to launch his own marketing business.

“I thought maybe I could make more opportunities for myself, instead of waiting for other people to create opportunities for me,” said the 24-year-old, who is now living in Tucker, Ga.

Tilt, after hearing more optimism among her small-business peers, decided to add another employee to her Marietta, Ga., communications consulting firm.

“That is a big leap,” she said. “It is very personal for me if I bring someone into the company and I become responsible for their income.”

Some economists suspect that the exhale moment is less about a surge in confidence than about people simply adjusting to a new normal. Farr, the investment manager, is one.

“The experience of dramatic declines in asset prices, home values and negative economic reports is far enough in the past; it’s faded from people’s memory banks,” he said. “They’ve become accustomed to these conditions.”

But Tutterow, the Mercer economist, believes hope is alive and well – enough, perhaps, to revitalize consumer spending and even revive the region’s aspirations.

“Collectively, the community’s confidence is coming back,” he said.

Copyright © 2013 The Atlanta Journal-Constitution (Atlanta, Ga.) Distributed by MCT Information Services.

Tuesday, April 30, 2013

First Time Buyers Checklist

A great first time buyer checklist was published on FloridaRealtors this week. If you are considering buying a home, we hope this article will assist you in the process. 
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Need-to-know home buying info for first-timers
PROVIDENCE, R.I. – April 29, 2013 – Homeownership starts with a desire to achieve the American Dream – to have a home of one’s own. After that, however, pragmatic questions must be answered, such as how much a buyer can afford and whether a bank will be willing to lend them money.

“Buying a home can be one of the biggest purchases a consumer will make,” says Cheryl Nolda, president, Home Lending Solutions, RBS Citizens Financial Group. “A house is the foundation where individuals and families build their lives and make memories.”

Charter One Bank put together a list of home buying tips for consumers who have decided that homeownership is right for them:

• Determine purchasing power. Calculate how much you can afford to spend before you start looking to focus on houses in that price range. The answer depends largely on income and current monthly debt payments.

• Secure your credit report. If there are any credit issues, get them addressed before applying for a mortgage loan. A free annual credit report can be obtained by calling 1-877-322-8228 or going to:www.annualcreditreport.com.

• Do your mortgage homework. Take the time to learn important mortgage and home-buying terms; more importantly, understand what they mean. Investigate the details – What are the additional costs, such as origination or application fees?

• Get pre-approved. A mortgage pre-approval assessment tells you approximately how much money you can borrow from your lender. In addition, many sellers require a pre-approval letter before reviewing a buyer’s offer. (After applying, avoid doing anything that would negatively impact your credit score, such as opening a new credit card or making a large purchase until after the home closing.)

• Buyer’s checklist. Use a homebuyer’s checklist at each house to keep track of important features like amenities, neighborhood and schools. This helps you compare notes and remember the differences and characteristics of each house, especially if you visit several houses in different locations.

• Know the market. When you know local market and home values, you’re less likely to overpay for a property. Use the Comparative Market Analysis (CMA) and full MLS listing details of the most similar comparable properties to help you know how much you should offer. And be on the lookout for owners who are eager to sell and willing to negotiate – this can save you thousands of dollars.

• Home inspection. Hire a professional home inspector to determine if there are any potential problems that can be expensive to repair.

• Have a backup plan. You and a seller may reach a stalemate when negotiating. Consider developing a back-up plan, just in case you are unable to reach an agreement. Define your maximum offer and don’t go over it – there are almost always other homes that will meet your criteria.

© 2013 Florida Realtors®
To find the article, click here

Tuesday, March 26, 2013

Community Development Plan up for vote in Winter Park

One of the latest community projects in the Winter Park area, Ravaudage, and its Developer, Dan Bellows, is asking Winter Park leaders to establish a community development district for the remainder of the project.

Community Development Districts are a popular tool for financing development. 
The districts, known as CDDs, have become an extremely popular mechanism for financing development. A few of the successful CDDs in the area include The Villages, Baldwin Park, and Celebration.

The districts increase the tax base at no cost to municipal governments or citizens who don't live in the district. Those who move into the district pay assessments to the district to fund improvements. And after the developer completes the project and moves on, there's an entity in place — more powerful than any homeowners association — to deal with oversight and maintenance issues.

For developers, such as Bellows, the advantages include the ability to sell tax-free bonds and charge assessments.  This source of funding can lead to rapid infrastructure that might otherwise take years to build.

The 73-acre Ravaudage site at Lee Road and U.S. 17-92 currently has one tenant, Miller's Winter Park Ale House restaurant.  The Ravaudage project is envisioned to include 489 residential units, retail and office space, and a 320-room hotel.

Thursday, February 21, 2013

U.S. housing starts dip but remain at solid pace

WASHINGTON – Feb. 20, 2013 – U.S. homebuilders began work at a slower pace in January, though the level was still the third highest since 2008. The pace of building was viewed as a sign of further strengthening in residential real estate.

The Commerce Department says builders started construction at a seasonally adjusted annual rate of 890,000 last month, down 8.5 percent from December, when activity had hit an annual rate of 973,000. The December performance was the best since June 2008.

Applications for building permits rose to an annual rate of 925,000 in January, 1.8 percent higher than December, which had been the high point since mid-2008.

The pace of construction of single-family homes rose 0.8 percent in January, but apartment construction, which is more volatile, dropped 24.1 percent.

The U.S. housing market is slowly regaining its health after stagnating for roughly five years after the housing boom collapsed. Steady job gains and near-record-low mortgage rates have encouraged more people to buy.

A steady rise in prices reflects, in part, fewer homes for sale. The supply of previously occupied homes for sale has reached its lowest level in more than a decade. And the pace of foreclosures, while still rising in some states, has slowed sharply on a national basis. That means fewer low-priced foreclosed homes are being dumped on the market.

Those trends, and the likelihood of further price gains, have led builders to step up construction. Last year, builders broke ground on the most homes in four years.

For all of 2012, builders started work on 780,000 homes. That was still only about half the annual number consistent with healthy markets. But it represents a 28 percent jump from 2011. And it was the most housing starts since 2008, when construction was still falling after the housing bubble burst more than six years ago.

Sales of new homes jumped nearly 20 percent last year to 367,000, the most since 2009. Still, many economists don’t foresee a full housing recovery before 2015 at the earliest.

The National Association of Home Builders said Tuesday that confidence among U.S. homebuilders slipped in February from a 6 1/2-year high in January. Many builders reported less traffic by prospective customers before the critical spring home-buying season begins.

The home builders’ sentiment index dipped to 46 in February from 47 in January. It was the first monthly decline in the index since last April.

Readings below 50 suggest negative sentiment about the housing market. The last time the index was at 50 or higher was in April 2006, when it was 51. It began trending higher in October 2011, when it was 17.

Many builders are facing higher costs for building materials and having trouble obtaining financing for construction. Some also are facing a shortage of workers in markets where residential construction has picked up sharply, such as Texas and Arizona.

Though new homes represent only a fraction of the housing market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to statistics from the home builders.
AP LogoCopyright © 2013 The Associated Press, Martin Crutsinger, AP economics writer. All rights reserved.

Sunday, February 3, 2013

Fannie & Freddie have Good News for Underwater Mortgages

For homeowners with Fannie Mae and Freddie Mac loans, the much anticipated good news may have arrived this past week.  On March 1st, Fannie and Freddie will start allowing homeowners with underwater mortgages (they owe more than the property is worth) to give up the house and cancel their debt by a deed-in-lieu of foreclosure. 

Who qualifies for deed-in-lieu transactions?  Well according to the new rules:

  • Homeowners must must be current or less than 90 days late on their mortgage payments. 
  • Homeowners must by making payments of at least 55 percent of their monthly income for the house.
  • Homewoners must be able to document a "hardship" that requires a move, such as loss of spouse.
  • The home must be clean and not damaged.
Once a homeowner qualifies, they should know that it is not the perfect solution.  A few things to know about:
  • Homeowners may have to surrender as much as 20 percent of personal assets, excluding retirement accounts, to partially meet the loan's unpaid balance.
  • The program does not affect second mortgages.  Mortgage servicers can offer up to $6,000 for second-lien holders to release borrowers from the loans, but there's no requirement that the holders agree.
  • A deed-in-lieu will still affect your credit, but not to the extent of a foreclosure.
Even with all of the restrictions, the new Fannie and Freddie program is a viable option and good news for homeowners who must move due hardship and have underwater mortgages.

For more information on the program, click here for the new rules.

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Tuesday, January 29, 2013

Where is the Inventory?

Where is the inventory?  One of the factors for the decrease in December home sales was lack of inventory. The National Association of Realtors reported a 21.6 percent drop from one year earlier.  

A recent article by the Wall Street Journal highlighted several reasons behind the dropping inventories, including: 

• Sellers hesitant to sell: About 22 percent of homeowners with a mortgage remain underwater, owing more than their home is currently worth. These homeowners don’t tend to sell unless a life-changing event occurs because they don’t want to take a loss on the sale. CoreLogic data finds constrained inventories in areas with the highest number of underwater borrowers.

• Not enough equity to trade up: Homeowners often rely on equity from their current home to make a down payment on the next home. 10 million homeowners have less then 20% equity in their home. With fewer homeowners seeing equity, they may not have enough money to move into a pricier home – a constraint on the would-be “trade up” buyer.


• Investors continue to snatch up properties: Investors still snap up properties, but they’ve changed their strategy.  The original strategy was to purchase the home and flip it.  Now they are holding onto properties and turning them into rentals.  The result: fewer homes on the market.


• Banks slowing down foreclosures: Banks have new rules to meet with the foreclosure process, and it’s causing them to move at a slower pace. Banks also are showing a preference for short sales and loan modifications, which curbs the number of foreclosed homes on the market.


• Builders doing less building: Housing starts were at record lows from 2009 through 2011, so there’s less inventory added to the market. A rebound in the new-home market has only recently started to occur.


Source: “Six Reasons Housing Inventory Keeps Declining,” The Wall Street Journal (Jan. 22, 2013) 

To view the article, click here

NAR: Dec. pending home sales down but still uptrend

It's that time of the month to look at home sales trends.  A press release issued by the National Association of Realtors (NAR) this week reports pending home sales declined in December but have stayed above year-ago levels for 20 consecutive months.

NAR pointed to several factors involved in the decrease. One of the factors may be the supply - more buyers then sellers.  The study also pointed at current sales prices and the fact that first time buyers have fewer options available to them.

Still, Lawrence Yun, NAR chief economist, is forecasting existing-home sales to increase another 9 percent in 2013, following a 9 percent rise in 2012.

To read the press release, click here.


Friday, January 18, 2013

End of the Year Report - Florida leads in Foreclosure Filings

Today's RealtyTrac Foreclosure Market Report for 2012 was released.  According to RealtyTrac, Florida led the entire country in foreclosure filings started within the last twelve months.

The Release states:



  1. Foreclosure activity in 2012 increased from 2011 in Florida by 53%
  2. Florida’s foreclosure rate surpasses every other state in the country last year, as one in 32 homes in the State of Florida got a foreclosure filing during the year.
  3. In 2012, a total of 279,230 Florida properties had a foreclosure filing, a 53% percent increase from 2011 but still 42% lower than 2010′s historic total of 485,000 Florida properties in foreclosure.
  4. Florida had the biggest share of foreclosure inventory in the U.S., with 305,766 properties in some stage of foreclosure or bank owned (20 percent of the national total).
  5. The average time to foreclose in Florida ranks 3rd highest in the country at 853 days (or 2.3 years).
So what lies ahead for Florida in 2013?  According to Daren Blomquist, Vice President of RealtyTrac:

“2012 was the year of the judicial foreclosure, with foreclosure activity increasing from 2011 in 20 of the 26 states that primarily use the judicial process, and a judicial state — Florida — posting the nation’s highest state foreclosure rate for the first time since the housing crisis began,” said Daren Blomquist, vice president at RealtyTrac. “Meanwhile foreclosure activity continued to decline in 19 of the 24 states that use the more streamlined non-judicial foreclosure process, but there could be a backlog of delayed foreclosures building up in some of those states as well as the result of recent state legislation and court rulings that raise the bar for lenders to foreclose.
“That could mean that although we are comfortably past the peak of the foreclosure problem nationally, 2013 is likely to be book-ended by two discrete jumps in foreclosure activity,” Blomquist added.  “We expect to see continued increases in judicial foreclosure states near the beginning of the year as lenders finish catching up with the backlogs in those states, and another set of increases in some non-judicial states near the end of the year as lenders adjust to the new laws and process some deferred foreclosures in those states.”
The positive spin of the report - median home prices are on the rise.  To view the full report, click here. 

Monday, January 14, 2013

News of Another Big Settlement

The Federal Reserve and the Office of the Comptroller of the Currency issued a joint press release to announce news that 10 mortgage servicers around the country have entered into a settlement agreement with the federal government over allegations of bad acts in mortgage servicing and foreclosure activities.  The Settlement will release the 10 mortgage servicers from further federal prosecution in exchange for the payment of $8.5 billion in cash.  The Settlement money will be used to help those who have been hurt in the Foreclosure Crisis of the past few years

To view the press release, click here or read below:

Independent Foreclosure Review to Provide $3.3 Billion in Payments, $5.2 Billion in Mortgage Assistance

WASHINGTON--Ten mortgage servicing companies subject to enforcement actions for deficient practices in mortgage loan servicing and foreclosure processing have reached an agreement in principle with the Office of the Comptroller of the Currency (OCC) and the Federal Reserve Board to pay more than $8.5 billion in cash payments and other assistance to help borrowers.
      
The sum includes $3.3 billion in direct payments to eligible borrowers and $5.2 billion in other assistance, such as loan modifications and forgiveness of deficiency judgments. The payments involve mortgage servicers operating under enforcement actions issued in April 2011 by the OCC, the Federal Reserve, and the Office of Thrift Supervision. The agreement ensures that more than 3.8 million borrowers whose homes were in foreclosure in 2009 and 2010 with the participating servicers will receive cash compensation in a timely manner.
      
Eligible borrowers are expected to receive compensation ranging from hundreds of dollars up to $125,000, depending on the type of possible servicer error.
      
This agreement includes Aurora, Bank of America, Citibank, JPMorgan Chase, MetLife Bank, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo. For these participating servicers, fulfillment of the agreement would meet the requirements of the enforcement actions that mandated that the servicers retain independent consultants to conduct an Independent Foreclosure Review.

As a result of this agreement, the participating servicers would cease the Independent Foreclosure Review, which involved case-by-case reviews, and replace it with a broader framework allowing eligible borrowers to receive compensation significantly more quickly. The OCC and the Federal Reserve accepted this agreement because it provides the greatest benefit to consumers subject to unsafe and unsound mortgage servicing and foreclosure practices during the relevant period in a more timely manner than would have occurred under the review process. Eligible borrowers will receive compensation whether or not they filed a request for review form, and borrowers do not need to take further action to be eligible for compensation.

      
A payment agent will be appointed to administer payments to borrowers on behalf of the servicers. Eligible borrowers are expected to be contacted by the payment agent by the end of March with payment details. Borrowers will not be required to execute a waiver of any legal claims they may have against their servicer as a condition for receiving payment. In addition, the servicers' internal complaint process will remain available to borrowers.
      
The agencies continue to work to reach similar agreements in principle with other servicers that are not parties to the agreement announced today, but that are also subject to enforcement actions for deficient practices in mortgage loan servicing and foreclosure processing.
      
OCC and Federal Reserve examiners are continuing to closely monitor the servicers' implementation of plans required by the enforcement actions issued in April 2011 to correct the unsafe and unsound mortgage servicing and foreclosure practices.

Friday, January 4, 2013

Federal Estate & Gift Tax... Congress Answers



There has been much talk over the last few months on the "expiration date"  of exemptions pertaining to federal estate taxes, gift taxes and generation skipping transfer taxes created under Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act ("TRUIRJCA" or "TRA 2010" for short) that was enacted in December 2010. 

After much debate, the American Taxpayer Relief Act ("ATRA" for short) was signed into law by President Obama on January 2, 2013. This new law makes the changes made by TRA 2010 permanent with regard to federal estate taxes, gift taxes and generation skipping transfer taxes.

Below you will find a summary of the 2013 Changes:

1. New and more favorable exemptions on estate tax, gift tax and generation-skipping transfer taxes. ATRA set the lifetime gift and estate tax exemption at $5 million per person, with annual adjustments for inflation.  Married couples may combine their exemptions to allow for double that amount.  The 2012 federal estate tax exemption rate of $5.12 million increased to $5.25 million for 2013. 

2. Less favorable top tax rates. The Estate Tax Rate increased from 35% to 40% on taxable estates (estates valued over $5.25 million). 

3. Portability of the federal estate tax exemption between married couple now permanent. A married couple can pass on $10.5 million to their heirs free from federal estate taxes. Note, however, that even if the deceased spouse's estate will not be taxable (in other words, is valued less than $5.25 million), the surviving spouse will nonetheless be required to file IRS Form 706, United States United States Estate (and Generation-Skipping Transfer) Tax Return, in order to take advantage of the deceased spouse's unused estate tax exemption, otherwise the deceased spouse's exemption will be lost.