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How to Qualify for HAFA

April 6, 2010 By Debbie
QUALIFYING FOR HAFA: Homeowners eligible under HAMP must be considered for the HAFA program before the loan goes into foreclosure if the homeowner:

Does not qualify for a Trial Period Plan. HAMP requires homeowners enter a Trial Period Plan for their modified mortgage before getting a modification.

Homeowner is delinquent on a HAMP modification by missing at least two consecutive payments.

Under HAMP, borrower requests a short sale or deed in lieu.

Short sale process under HAFA:

Before a homeowner can be approved for a HAFA short sale, the lender must provide a listing price or a minimum amount it will accept for the sale.

A fixed termination date at least 120 days from the date the short sale agreement is given to the homeowner. The servicer may extend the agreement up to 12 months if agreed to by the homeowner.

Property must be listed with a licensed real estate professional who is regularly doing business in the community.

The servicer must determine the amount of closing costs and other expenses they will allow to be deducted from the gross sale proceeds. This must be a dollar amount, percentage of the list price or a list by category of reasonable costs.

The amount of the real estate agent’s commission must be determined and cannot exceed 6 percent of the contract sales price.

The homeowner will need to give a statement allowing the services to communicate the homeowner’s personal financial information to other parties as necessary to complete the transaction.

Cancellation and contingency clauses must be included in the listing notifying potential home buyers that the sale is subject to approval by the servicer and/or third parties.

The home buyer may not sell the property within 90 days of closing.

After the sale is completed, the homeowner is released from all liability for repayment of their first mortgage debt.

After the sale, the homeowner can receive up to $3,000 for moving costs.

The homeowner must be informed of income tax consequences and a possible hit to their credit score.

Filed Under: Foreclosure Information, HAFA Tagged With: HAFA, hamp, shot sale

Bank of America: Plan to Modify Mortgages

April 1, 2010 By Debbie

How Bank of America’s Mortgage Write-Down Program Works :

Bank of America is making a new effort to modify mortgages by cutting loan balances.

Under the program, Bank of America will reduce certain loans by up to 30% in order to lower monthly payments for borrowers facing foreclosure. Here’s how it works: ONLY  borrowers who had loans from Countrywide Financial, which Bank of America acquired in mid-2008, will be eligible. And ONLY the riskiest loans will qualify: subprime loans, “option adjustable-rate” mortgages that have low initial monthly payments but that can adjust sharply higher, and certain prime loans that have a fixed interest rate for the first two years before starting to adjust annually.

The program is also limited to customers who have missed at least two consecutive payments, who can demonstrate that a financial hardship prevents them from making payments at the current level, and whose loan balance is at least 120% of the estimated home value.

Bank of America will go through its loan book to see which loans might qualify for reductions (while checking property values to see which ones are far enough under water), and then the bank will contact the borrowrs.

Bank of America says that around 45,000 borrowers could see their loan balances reduced with an average reduction of more than $62,000.

The bank’s approach has an interesting design feature in an attempt to prevent homeowners who are still paying their loans from defaulting and becoming eligible for the program. Loan balances aren’t reduced in one clean strike. Instead, the bank  is offering what’s called “earned forgiveness.”

The program works like this: for a borrower who owes $300,000 on a home worth $200,000, the bank would reduce up to $100,000 in principal and place it in an interest-free account. For each of five years, the bank would forgive another $20,000 as long as the borrower continued to make payments and until the borrower was returned to a 100% loan-to-value ratio. If home prices have recovered by the fourth or fifth year to meet the amount owed, Bank of America would stop forgiving money in the interest-free account, which would have to be paid off when the home is sold or the loan is refinanced.

What about SECOND MORTGAGES? To be sure, there are drawbacks.  Bank of America said it will modify first mortgages that have seconds behind them only when Bank of America owns the first mortgage AS WELL.  The government’s modification program, Home Affordable Modification Program, has faced challenges because borrowers haven’t been able to document their incomes, and those requirements don’t go away in this effort.

This is aimed towards helping those in deep financial difficulty so it will be interesting to see how it works.

Filed Under: Foreclosure Information, Loan Modifications, Seller Info Tagged With: bank of america

New HAFA Program: Borrowers Get Help In Selling Homes!

April 1, 2010 By Debbie

Great News for homeowners who have a mortgage and need the banks to cooperate with them in doing a short sale.

As of April 5, 2010, the government is doubling the incentives for banks to cooperate in short sales; they are now going to receive $3000 to bank participants on the first loan, and up to $6000 on the second loan.

They are also going to double the incentive to borrowers / sellers participating in short sales to assist in relocating.

* NOT every Short Sale will be a HAFA Guidelines Short Sale. Remember, these are guidelines not laws.

* A borrower does NOT have to go through the HAMP Loan Mod process to qualify for a HAFA Short Sale. In other words, they can simply request a Short Sale (or Deed in lieu of foreclosure) which means giving the house back to the bank.

* Virtually ever lender is participating.

* There will be standardized, uniform forms.

* Lender will tell the real estate broker/ agent the NET dollar amount they need upfront.

* Borrowers MUST list with an agent. No For Sale By Owner doing a HAFA short sale.

* Lenders have 10 days to approve/ accept or request and extension to all offers.
* If the lender (servicer) doesn’t accept your Short Sale offer they have to tell you IN WRITING why.

* Fannie and Freddie HAFA Guidelines are coming soon.

Filed Under: HAFA, News, Seller Info Tagged With: HAFA, sellers, short sale

Short Sale Glossary Terms

March 17, 2010 By Debbie

 SHORT SALE: A homeowner can enter into a short sale when they owe more on their mortgage than the home is currently worth.

In a short sale, the servicer allows the homeowner to list and sell the mortgaged property with the understanding that the net proceeds from the sale may be less than the total amount due on the first mortgage.

DEED-IN-LIEU OF FORECLOSURE: With a deed-in-lieu, the borrower voluntarily transfers ownership of the property to the servicer.

SERVICER: A mortgage servicer is responsible for collecting monthly loan payments as well as escrow accounts.

DELINQUENT: A homeowner is delinquent on their loan when they fail to make payments.

DEFAULT: A homeowner can default when they are unable to pay their debt.

FORECLOSURE: A foreclosure occurs when the homeowner’s right to the property is terminated. A home can be foreclosed upon when the homeowner defaults on their mortgage payments.

 

Filed Under: Foreclosure Information, HAFA, News, Real Estate Advice, Seller Info Tagged With: foreclosure, HAFA, short sale

I have just been appointed to join ExcellenREO

March 17, 2010 By Debbie

I have been working for TitaniumInc.com for two years assisting home owners having difficulty paying their mortgages. My title is Home Retention Consultant. Titanium Solutions is a wonderful company. Basically, different banks / services contact Titanium who in turn send one of their Brokers like me out to the Borrower’s Home. The goal is to make contact with the borrower and have them speak directly with the bank in my presence, OR if they are trying to do a loan modification, my assignment may be to obtain the documents and have them notarized, then fedex to the Servicer.

Titanium has a sister company, called Excellen REO. This company has hired 1100 real estate agents and broker across the country – and I am one of them – to list their assets, that is, properties. These are bank owned properties, otherwise known as REO (real estate owned). I will be posting more information on this web site in the near future. I do not expect any listings until possibly May, 2010. However, I will keep you posted.

Filed Under: Foreclosure Information, News, reo Tagged With: Excellen, reo

Buying and Selling with Contingencies: Can be Frustrating…

March 5, 2010 By Debbie

This article appears on the CAR.org web site,which is the California Association of Realtors Site. I thought it might be of interest.

http://www.yourpieceofcalifornia.com/news2_080309.asp

Filed Under: Buyer Info, Real Estate Advice, Seller Info

Buyers: What you should know before buying a home….

January 18, 2010 By Debbie
 
  1. Before you start looking for a home, get pre-qualified for a loan. Banks, credit unions and mortgage bankers make home loans; mortgage brokers process them. The lenders will take an application, process the loan documents, and see the loan through to the funding stage.


  2. If you have marginal or bad credit, consult your lender. You may be able to qualify for a loan depending on how long ago and what reason(s) caused the bad credit. A lender should be able to advise you on whether your credit history will prevent you from qualifying for a home loan.


  3. You will need a down payment. Down payment requirements vary depending on the type of loan. Many down payment assistance programs exist. These programs may loan or grant you the funds necessary for the down payment. Consult with a lender about programs available in your area.


  4. You will need funds for closing costs Closing costs are charges for services related to the closing of your real estate transaction. They include, but are not limited to:
    • Escrow fees charged by the company handling the transaction
    • Title policy issuance fees charged by the title insurance company
    • Mortgage insurance fees
    • Fire and homeowners insurance
    • County Recorder fees for recording your deed
    • Loan origination fees
      Consult your lender for an actual estimate of these costs, as well as information about loan programs which can assist in financing your closing costs
  5. Some loans have “points” and some do not. A point is a loan origination fee equivalent to 1% of the loan amount. Together with the interest rate they constitute the yield on your loan for the lender. Some lenders charge a higher interest rate to compensate for charging no points. It is important to comparison shop lenders to make sure your loan is at a competitive yield.


  6. Should you select a mortgage with a fixed rate or an adjustable rate? The answer to this question depends on whether mortgage rates are at a high or a low point when you purchase, and on how long you plan to live in the home. If rates are high, an adjustable rate might be attractive since subsequent rate drops could reduce your monthly payments. Additionally, lenders may offer a low rate during the first few years of an adjustable mortgage to make it appealing to you. If interest rates are low you might want to take a fixed rate to protect yourself against the possibility of rising interest rates.


  7. Be aware of the two main types of loan categories.
    • Conventional Loans. Conventional mortgage loans are available with fixed or adjustable interest rates. Some loans may require mortgage insurance.
    • Government Loans. These include Federal Housing Administration (FHA) fixed and adjustable rate mortgage loans, and Veterans Administration (VA) fixed rate mortgage loan


  8. If you are a low or moderate income homebuyer, there are special programs designed to help you. These loans are available through private lenders, as well as local and state housing agencies, like the California Housing Finance Agency (CalHFA). Most lenders specializing in real estate mortgage loans are aware of these types of loan programs.


  9. Why might I have to pay mortgage insurance? Mortgage insurance protects the lender from potential loss if you should default on your mortgage loan payment. Generally, conventional loans that require larger down payments do not require mortgage insurance. Mortgage insurance is always required on FHA mortgage loans.


  10. Many organizations offer home loan counseling to prospective homebuyers. These organizations provide classes for homebuyers to cover the steps to homeownership. They will cover home selection, realtor services, lenders, loan programs, homeownership responsibilities, saving for a down payment, and other important pieces of information. Many first-time homebuyer programs require homebuyers to attend this type of class to be eligible for selected programs.


Call me for a list of approved lenders, some of which may be on this site.

Filed Under: Buyer Info Tagged With: get pre-qualified, home loans, loan application, mortgage bankers

Home Buyer Program Extended……

November 8, 2009 By Debbie

Great News!  The Federal Government DID extend the federal tax credit through April 30, 2010,
with a 60-day extension if a binding contract is in place before the deadline. First-time homebuyers will continue to be
eligible for a tax credit of up to $8,000, while existing homeowners will be eligible for a reduced credit of up to $6,500.
To qualify for the $6,500 credit, existing homeowners must have lived in their current homes for at least five years.
The bill also increases the qualifying income limits from $75,000 for single tax filers and $150,000 for joint filers to
$125,000 and $225,000, respectively. The purchase price of the home is capped at $800,000 in both instances.

Under additional provisions included in the bill, taxpayers can claim the credit on purchases completed in 2010 on their 2009
income tax returns. The legislation maintains the provision that home buyers do not have to repay the credit provided the home
remains their primary residence for 36 months after purchase, and waives this requirement for active duty military personnel who move due to a military order.

Nationwide, more than 1.4 million first-time home buyers were given the chance to become homeowners as a result of the Federal Tax Credit for
First-time Home Buyers. It is expected that number to increase dramatically in the months ahead with this new legislation in place.

Filed Under: Buyer Info, News, Seller Info Tagged With: buyers, Obama Plan, sellers

First Time Buyers: Start House Hunting Now!

August 21, 2009 By Debbie

Start house-hunting now to qualify for tax credit for first-time
home buyers

First-time homebuyers-those who have not owned a home for at
least three years-may be eligible for the $8,000 federal tax
credit, but the window of opportunity is closing rapidly.

To qualify for the credit, the buyer must close escrow by midnight
on Nov. 30, when the tax credit expires. Buyers hoping to take
advantage of this benefit are advised to start house-hunting
early, as the buying and lending processes takes time.

MAKING SENSE OF THE STORY FOR CONSUMERS

I really think that since finding the right house can take some time, so  I reaally believe that home buyers should start the process when they think they are able and ready to buy.  Buyers also should allow for more time in getting their mortgage loan since that process is taking about two weeks longer to process this year compared to last year.

The tax credit is equal to 10 percent of the purchase price, up
to $8,000, subject to income limits. Single taxpayers are
eligible if their modified adjusted gross income is $75,000 or
less, while married taxpayers filing jointly must have a
modified adjusted gross income of $150,000 or less.

In order to qualify, you must live in the property. Vacation homes and investment homes do not qualify. Houseboats do qualify as do manufactured homes.

The seller cannot be related to the buyer in any way.

Married people filing as such cannot claim the credit if either
spouse has owned a primary residence within the last three
years. However, unmarried joint purchasers may allocate the
credit in any way they see fit, as long as it does not exceed
the $8,000 maximum.

The government will allow those who finance their purchases with
a federally insured loan to apply their anticipated credit
immediately toward closing costs or as additional down payment,
rather than waiting until they file their 2009 taxes to receive
the refund.

Filed Under: Buyer Info, News, Real Estate Advice Tagged With: government tax credit

Banks Slow to Modify Mortgages…US Treasury Dept reports

August 19, 2009 By Debbie

An article in the L.A. Times discusses how some banks are making up excuses by telling home owners that they do not qualify for a loan modification because….. My associate Dan Dobbs, loan manager at
949 250-3981  who made me aware of this article states that the banks are not following the Obama Plan as they should. Basically, the article is about some banks who are making it difficult for homeowners to obtain the loan modifications they may be qualified to obtain.

If you would like a copy of the Plan, please let me know and I will send it to you.

Filed Under: Foreclosure Information, Loan Modifications, News, Seller Info Tagged With: loan modification
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