My Blog

Orange County February 2012 Home Sales

3/12/2012
Orange County February 2012 Home Sales


Los Angeles County February 2012 Home Sales

3/12/2012
Los Angeles County February 2012 Home Sales









Its ok to buy a "Fixer Upper"

2/12/2012

Mortgage aid offered to those who cashed out equity

4/8/2011

Program Details


Each of the approved programs has certain borrower and property specific eligibility requirements.

The eligibility criteria are designed to assist those who have been most seriously impacted by the current housing crisis.

General borrower eligibility requirements:

  • Borrower does NOT need to be a CalHFA borrower.
  • Borrower must own and occupy the home as their primary residence.
  • Borrower must meet low and moderate income limitations.
  • Borrower must complete and sign a Hardship Affidavit and document the reason for the hardship, which may include the loss of employment, reduction of income, disability or illness. The documentation to support income should not be more than 60 days old as of the date the borrower applies for the modification program.
  • Borrower has adequate income to sustain modified mortgage payments according to lender guidelines.
  • Borrower is able to satisfy program guidelines established by CalHFA.
  • Borrowers mortgage loan is delinquent or the servicer received documentation from the borrower that substantiates an imminent default that meets hardship qualifications.
  • Borrowers who have recently encountered a financial hardship due to their military service are presumed eligible on the condition that their servicer has received a financial hardship statement provided by the borrower.

For all the details, please see the Keep Your Home California Website:
http://www.keepyourhomecalifornia.org/eligibility.htm


C.A.R. open letter on short sales

3/10/2011

March 10, 2011

An important message from the CALIFORNIA ASSOCIATION OF REALTORS®:

I write on behalf of the CALIFORNIA ASSOCIATION OF REALTORS®, whose 170,000 members continue to witness the devastating consequences the home foreclosure crisis is having on Californias families, neighborhoods, and communities on a daily basis. 

The number of families affected by foreclosure is staggering.  During the past three years, more than 640,000 Californians have lost their homes.  With the number of homeowners who owe more than their home is worth hovering at 30 percent, experts predict there will be many more foreclosures in 2011 and 2012.  Unless we take immediate, aggressive action to assist these homeowners, any meaningful recovery in the housing market and overall economy will continue to be delayed.

Tragically, only a fraction of those who face foreclosure will remain in their homes when all is said and done.  Those whose incomes and financial circumstances meet strict guidelines may qualify for a loan modification that will reduce their monthly payment to more affordable levels.   Yet the federal Home Affordable Modification Program (HAMP) is expected to prevent only 700,000 to 800,000 foreclosures nationwide before it expires at the end of 2012, and the program does little to help those homeowners who are unemployed or otherwise no longer able to meet their financial commitments.  Their last hope is to sell their home, which often means convincing their lender or the investor who owns the loan (and, in many cases, the holder of a second mortgage lien and the mortgage insurer) to accept a short sale.

With a short sale, homeowners with a proven hardship negotiate an agreement to sell their home for less than the balance owed.  Although not every homeowner or mortgage is eligible, those who are able to finalize a short sale avoid a foreclosure on their credit record and can move on with their lives.  Last year, 20 percent of home sales in our state involved short sales.

Short sales can play an important role in our states economic recovery by accelerating the pace of home sales and reducing the inventory of bank-owned homes on the market.  There are other benefits as well.  Homebuyers who can qualify for a mortgage at todays low interest rates also are able to purchase a home at below-market prices.  Banks get a nonperforming asset off their books and avoid the headaches associated with disposing of assets they dont want to own in the first place.  Neighborhoods have fewer abandoned homes, and local businesses have more customers with money to spend. 

Unfortunately, many homeowners are unable to successfully negotiate a short sale.  According to a recent survey of 2,150 California REALTORS® who have assisted clients with a short sale, only three out of five transactions closed even when there was an interested and qualified buyer. 

Whats the problem?  For one, no two mortgage agreements are the same, so it can be difficult to standardize short sale processes and procedures.  Many homeowners have second mortgages, which further complicate matters.  Then theres the challenge of convincing multiple parties to take a financial loss or, in the case of loan servicers, to forego fees they otherwise might earn during the course of the foreclosure process.  Poor and slow service by many banks and servicers has only exacerbated the problem.  Horror stories abound from potential homebuyers and REALTORS® forced to wait 90 or more days for a response to a purchase offer or being required to fax short sale applications or other paperwork as many as 50 times.   These delays discourage potential homebuyers from considering a short sale purchase and undermine the process for those who short sales are intended to benefit the hundreds of thousands of families facing foreclosure.   
 
Increasing the number of closed short sales by speeding up and streamlining the short sale process is one important way we can help California families avoid foreclosure and move our economy closer to recovery. Thats why the California Association of REALTORS® is taking steps to enable more families to arrange a short sale.  Recently, we advocated for improvements to short sale guidelines established under the federal Home Affordable Foreclosure Alternative (HAFA) program.  Were meeting with major banks, U.S. Treasury officials, government-sponsored entities (including Fannie Mae and Freddie Mac), and others to urge them to standardize processes, comply with federal guidelines, improve communication with other stakeholders and increase staffing with the goal of eliminating service issues.  Weve also offered our members training in every aspect of the short sale process so they can assist their clients.

But we cant do it alone.  Thats why were focusing the spotlight on short sales and calling on regulators, elected officials, nonprofits, business organizations, companies, and individuals with a stake in Californias economic future to resolve this issue and others that get in the way of a recovery.   It wont be easy, and some compromises will be required.  The important thing is that we need to act today.  Our families and our communities cant wait any longer.

Sincerely,
 
Beth L. Peerce
President
CALIFORNIA ASSOCIATION OF REALTORS®


- reprinted with permission

When is a Foreclosure Removed from Your Credit Report?

2/22/2011

When is a Foreclosure Removed from Your Credit Report?

Use this handy guide to figure out how quickly you can buy a home after a major financial setback when applying for a loan through FHA, Fannie Mae, or Freddie Mac.

Government entities set guidelines for credit events

The chart below outlines the criteria that government entities FHA, Fannie Mae, and Freddie Mac follow for major credit-busting events, including foreclosure. Although FHA, Fannie Mae, and Freddie Mac arent direct lenders, they wield a lot of behind-the-scenes influence by working with banks to guarantee loans and help lenders free up capital to provide more mortgages.

One of these entities may have made your loan possible without you even knowing it. Although for the most part banks make loans to whomever they want, theyll likely find themselves following FHA, Fannie Mae, or Freddie Mac guidelines at a minimum in order to keep working with these useful partners.

Some lenders may have more stringent policies and others, willing to take greater risks, may work outside these entities and offer more liberal lending policies.

How to read the chart

This chart offers summaries of what can be complex rules and regulations. So:

1. Look to professionals, such as a bankruptcy lawyer and a CPA specializing in bankruptcy provisions, before making major financial decisions.

2. For HUD-approved counselors, go to http://www.hud.gov/offices/hsg/sfh/hcc/fc/index.cfm. You can also call 1-888-995-HOPE for help from the Homeownership Preservation Foundation.

3. Understand what extenuating circumstances means in each case:

FHA: An event that was out of the borrowers control that made a significant impact on the borrowers finances and led to bankruptcy or foreclosure.

Fannie Mae: A nonrecurring event thats beyond the borrowers control that results in a sudden, significant, and prolonged reduction in income or a catastrophic increase in financial obligations.

Freddie Mac: A nonrecurring or isolated circumstance, or set of circumstances, that was beyond the borrower's control and that significantly reduced income and/or increased expenses and rendered the borrower unable to repay obligations as agreed, resulting in significant adverse or derogatory credit information.

 
FHA

Fannie Mae

Freddie Mac
Foreclosure 3-year wait.
Reduced wait if borrower has re-established good credit and can show extenuating circumstances.
7-year wait from the completed foreclosure sale date.
3-year wait if borrower can show extenuating circumstances (additional underwriting requirements apply for 4 years after 3-year waiting period).
7-year wait for a second home, investment opportunity, or cash-out refinancing.

5-year wait from the completed foreclosure sale date.
3-year wait if borrower can show extenuating circumstances.
Short Sale No wait if not in default.
3-year wait if in default at closing of short sale.
Reduced wait if borrower has re-established good credit and can show extenuating circumstances.
2-year wait if the borrower puts 20% or more down.
4-year wait if the borrower puts 10-20% down.
7-year wait if the borrower puts less than 10% down.
2-year wait time if borrower can show extenuating circumstances and puts 10% or more down.
4-year wait.
2-year wait if borrower can show extenuating circumstances.
Deed in lieu of foreclosure Same as FHAs foreclosure policy. Same as Fannies short sale policy. Same as Freddies short sale policy.
Bankruptcy Chapter 7 (liquidation):
2-year wait from the discharge date of the bankruptcy.
1-2 year wait if borrower can show extenuating circumstances.

Chapter 13 (repayment plan):
1-year wait from the discharge date of the bankruptcy.


Chapter 7 or Chapter 11 (reorganization, usually involving corporations or partnerships):
4-year wait from the discharge or dismissal date of the bankruptcy.
2-year wait from the discharge or dismissal date may be accepted if borrower can show extenuating circumstances.
 
Chapter 13:
2-year wait from the discharge date or 4-year wait  from the dismissal date.
2-year wait for a dismissal if borrower can show extenuating circumstances.
 
Multiple bankruptcies:
5-year wait if the borrower has filed more than one bankruptcy petition in the past 7 years.
3-year wait if borrower can show extenuating circumstances.

Chapter 7 or Chapter 11:
Same as Fannies bankruptcy policy.
 
Chapter 13:
2-year wait from the discharge date of the bankruptcy.
2-year wait from the discharge or dismissal date of the bankruptcy if borrower can show extenuating circumstances.

Multiple bankruptcies:
Same as Fannie Maes policy for multiple bankruptcies.

Source: FHA Handbook, Fannie Mae Selling Guide, Freddie Mac Selling Guide

5 Tips for Buying a Foreclosure

12/1/2010

5 Tips for Buying a Foreclosure

Article From BuyAndSell.HouseLogic.com
By: G. M. Filisko

Get prequalified for a loan and set aside funds, and you'll be ready to purchase a foreclosed home.


When lenders take over a home through foreclosure, they want to sell it as quickly as possible. Since lenders aren't in the real estate business, they turn to real estate brokers for help marketing their properties. Buying a foreclosed home through the multiple listing service can be a bargain, but it can also be a problem-filled process. Here are five tips to help you buy smart.

1. Choose a foreclosure sale expert. Lenders list REO's with real estate brokers. You can work with a real estate agent who sells foreclosed homes for lenders, or have a buyer's agent find foreclosure properties for you. 
2. Be ready for complications. Have your attorney explain your state's foreclosure process and your risks in purchasing a foreclosed home.
3. Work with your agent to set a price. Ask your real estate agent to show you closed sales of comparable homes, which you can use to set your price.

4. Get your financing in order. Many mortgage market players, such as Fannie Mae, require buyers to submit financing preapproval letters with a purchase offer. They'll also reject all contingencies. Since most foreclosed homes are vacant, closings can be quick. Make sure you have the cash you'll need to close your purchase.

5. Expect an as-is sale. Most homeowners stopped maintaining their home long before they could no longer make mortgage payments. Be sure to have enough money left after the sale to make at least minor, and sometimes substantive, repairs.

Lenders will also require that you purchase the home "as is," which means in its current condition. Protect yourself by ordering a home inspection to uncover the true condition of the property, getting a pest inspection, and purchasing a home warranty.

Fannie Mae is offering buyers up to 3.5 in closing cost assistance

9/26/2010
Fannie Mae is offering buyers up to 3.5% in closing cost assistance on HomePath properties through December 31, 2010.

For the full story click on: http://www.fanniemae.com/homepath/incentive/index.jhtml

Receive an REO List

9/21/2010
If you would like to receive a sheet of REO Listings in your area, please sign up, or send me an email with your contact information. I would love to work with you on purchasing a low priced REO Property.

FHA Refinance of Borrowers in Negative Equity Positions

8/30/2010
From www.HUD.com

U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT WASHINGTON, DC 20410-8000 ASSISTANT SECRETARY FOR HOUSING-FEDERAL HOUSING COMMISSIONER www.hud.gov espanol.hud.gov August 6, 2010

August 6, 2010

MORTGAGEE LETTER 2010 -23

TO: ALL APPROVED MORTGAGEES

SUBJECT: FHA Refinance of Borrowers in Negative Equity Positions

On March 26, 2010, the Department of Housing and Urban Development (HUD) and the Department of the Treasury (Treasury) announced enhancements to the existing Making Home Affordable Program (MHA) and Federal Housing Administration (FHA) refinance program that will give a greater number of responsible borrowers an opportunity to remain in their homes. These enhancements are designed to maintain homeownership by providing borrowers, who owe more on their mortgage than the value of their home, opportunities to refinance into an affordable FHA loan. This opportunity allows borrowers who are current on their mortgage to qualify for an FHA refinance loan provided that the lender or investor writes off the unpaid principal balance of the original first lien mortgage by at least 10 percent.

This Mortgagee Letter provides additional guidance for lenders regarding the requirements and administration of these enhancements to FHAs refinance program. These enhancements are effective for loans with case numbers issued on or after September 7, 2010, which are closed on or before December 31, 2012.

As noted below, these enhancements include loss coverage to be provided from funds under the Emergency Economic Stabilization Act of 2008, as amended (EESA). If the availability of such coverage is delayed beyond September 7, 2010, implementation of these enhancements will also be delayed.

Eligibility

Participation is voluntary and requires the consent of lien holders. In order for a loan to be eligible, the following conditions must be met:

1. The homeowner must be in a negative equity position;

2. The homeowner must be current on the existing mortgage to be refinanced;

3. The homeowner must occupy the subject property (1-4 units) as their primary residence;
.......................

Read on for more info:
http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/10-23ml.pdf

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