Month: July 2008

Housing Bill to the Rescue…Do You Qualify?

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The House of Representatives, the Senate and the President are all on board to approve a $300 billion dollar bill which would help homeowners on the brink of losing their home avoid foreclosure.  

If you are interested in applying for this voluntary program talk to your current mortgage servicer.   You can also contact a FHA approved lender for help.   If you would like a list of these lenders, let me know.   I can give you additional information.

But who qualifies?   Below are just a few of the  qualifications that are being reported by  media outlets around our nation.  

* Your home loan had to be issued between Jan. 2005 and June of 2007.

*Borrowers that are planning on getting a home equity loan, must have FHA approval.   Your debt cannot be greater than 95% of your home’s appraisal value.

*Before you can get a FHA backed mortgage, the borrower must get rid of  lines of credit or  a home equity loan.   Borrowers will not be allowed to take  out  a home equity loan for 5 years.   There is  an exception to this last statement.   A borrower may take out a home equity loan only if it is used to pay for the upkeep on the home.  

*You don’t have to be in default yet!   Now you do have to prove that you will not be able to pay your existing mortgage.

*If you are already in default, you much prove that you are not purposely defaulting just to take advantage of the lower rates this program may offer.

Of course,   I am not going over the entire program.   It will be very interesting to  see how this program, once it is approved, will effect our nation’s housing crisis.   Let me know what you think!

Buckle Your Seatbelts and Hold On!

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As a buyer, you need to try to be ready for  anything in  today’s market.    As a Realtor, who has experience with traditional sales, short sales and foreclosures, I can  honestly  say that having an agent that can  negotiate on your behalf and is current in what is going on in the market is crucial.   In  this ever-changing market,  no one knows everything,  but you do need someone on your side, who can  work hard to answer all  of your questions and  have the ability to calmly and professionally handle all of the unexpected  problems that might arise.      

Having an agent that is willing to take the time that is needed to work for you is so important.   Let me share an example with you.

When  writing an offer and submitting  it to the listing agent of a foreclosure,  EXPECT a counter from the bank, unless your offer is listing price or above what the bank is asking for the property.    I have  heard COUNTLESS stories of buyers being counseled to not even bother with doing a counter.    Every time I hear this I am shocked.   This is a tough market.   You need someone on your side who knows what to do and instead of getting angry.   Now I am not talking about the buyer getting angry and giving up.   I am talking about the buyer’s agent!

The bank who owns the home, has  NO emotional attachment to the home you want to buy.   Their goal is to get the best price for their property, but in the end they dowant to sell it.   Banks have professionals on their side educating them on what their properties value is.   Banks are not in the business  of giving away homes.  

One of the best pieces of advice I give my clients when putting in a counter is: Know what you want to spend on the property you want to buy and educate yourself on what other similar properties are going for in the area.

As a buyer, if you really want that house, DON’T GIVE UP!  The best time to negotiate with banks is BEFORE they start to get multiple offers on their property.   This keeps you, the buyer from getting caught up in a bidding war.  

Bailout Fannie Mae and Freddie Mac?

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Let’s remember that both of these institutions are NOT banks.   They were created by the United States government to help more Americans have the opportunity to own homes by supplying more cash to banks, which in turn,  would loan more money to buyers.   Both Fannie Mae and Freddie Mac play a critical role in keeping an orderly flow of money available in our countries mortgage market.

In my opinion, if any of these two were to fall apart, it would send our already weakening economy into greater distress.   It would effect not just one bank, but financial institutions all over our country.  It would be a complete disaster for our fragile housing market.  

What is also worth mentioning is this “BAILOUT” has been granted only if it’s necessary.  

Last week the Federal Chairman spoke about how the regulator of Fannie Mae/ Freddie Mac and the Federal Housing Enterprise Oversight Committee have both found that the two companies are adequately capitalized.

I do believe something is in store for both of these companies, but only time will tell.   We might not see a bailout, but I wouldn’t be shocked to see the government step in to nationalize both of these mortgage giants.

Restrictions and Regulations for Lenders

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Since last December, we have heard about new rules that will clean up the lending industry.   Below, are a list of some of the new regulations that will be voted on next week by the Federal Reserve Board.

*Lenders CANNOT  give loans out  without proof of the borrower’s income.  

*Lenders could no longer force penalties on borrowers of risky loans who choose to make an early pay  off.

*Lenders will be required to have borrowers set aside money for insurance and taxes.

Helpful Hints Once You Move In

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Don’t forget that once you move into your new home there are maintenance issues that you need to periodically take care of to keep your home in its best condition possible.   These are tips I like to give to my buyers once they have moved in:

1.   Every now and then, check under all sinks for any signs of leaks.   This could prevent major water damage.   It’s also a good idea to do this before you go on an extended trip.

2.   When it comes to your furnace filters, try to change them monthly.

3.   Once a year drain your water heater.

4.   Make sure to test your circuit breakers 2 times a year.   Of course, I am not an electrician, but it probably would be a good idea to contact one if you are having any problems.  

5.   Try to fix things around your home before something goes wrong.  Especially when it comes to roofs, air conditioning units and water heaters.   Never feel bad about getting a SECOND opinion on an estimate.   About,  6 years ago I had a problem with our  air conditioner.   I called someone out, who told me I would need an entire NEW unit.   I went ahead and got a second opinion, and all it needed was some FREON.   Instead of  paying a  couple of thousand, I only spent $50.00.   And, Yes, the air conditioner is still working fine to this very day.