Banks Mortgage Servicing Plan

This article I picked up today was about the banks actually having a better way for the consumer to keep track of their loan modification status'....and more!

They are self-admitting, it would appear, that they have been screwing things up. Good, admission is the first 'step' towards a healthier lifestyle. And, these banks certainly could benefit from squeezing the 12 Step program into just one.

Banks Offer Own Mortgage Servicing Plan

However , I'm pro-mortgage reduction plans by these institutions too. They are losing tons, costing them arms and legs, and taking all-together too much time in bringing our housing crisis out of this crappy status.

Let's say they just give all homeowners a certain amount, 25%, reduction in the mortgage balance. Would that eliminate the 50% loss by taking back a property? Maybe. Would it eliminate some of the strategic defaults? Maybe. Would it help people stay in their homes? Quite possibly.

THEY ARE MEETING TODAY! 

Can't wait to hear the outcome.....

More Great Ways To Buy Your First Home!

Wow, oh wow! More new loan ideas! Some make me cringe a little, but for now if it helps qualified (note I italicized qualified) people get into homes? I'm all for it.

So, really, a way to do 99% financing. Should last for several years. There's a lot of money floating around to make it happen.

It's the CalHFA/Chdap combo loan package. 1% down, truly only 1%, with 99% financing and the 2.5 % is basically never paid until the property is sold.

For first time buyers or if you haven't owned for the last 3 years. Low rates, check the CalHFA website for current rates. 4.75 at time of writing. Must have the same minimum FICO score of 620, as with almost all FHA loans.  The seller can pay up to 3% towards closing costs. You do have to pay MIP, mortgage insurance, as well.

The regular FHA loan of 96.5% is the first. Then the buyer puts up 1%, and borrows through the Chdap program 2.5% which doesn't require any payments until the home is sold, re-fied or the first is paid off. And that rate is currently 3.25%.

There is over $66 million in funds available for the Chdap 2nd. Check out the website link below to see how the money is going!

Chdap Funds Available!

There certainly some restrictions to income levels. Must, of course, be owner occupied. But, yes, you can use a co-signer that isn't going to occupy the home. No manufactured homes, Flips create a bit of a problem. Forget homes that have non-permitted items, guest houses, or no stove. Won't work with this program.

You can use the Chdap program with other first loans also. There is a review of income for prior 3 years, mostly looking for the home ownership situation.

Seems a little crazy to give a home away to someone that only has 1% towards the purchase price. Seems like we did that a few years ago....? But, again, if they are qualified properly and really want to take advantage of great home prices, and just don't have a lot of money saved...this is a terrific option!

Sales Slump in February

So here we are about to start the 2nd quarter of 2011 and everything I've been reading this week mentions the slump in sales in February. Okay, it's true, it's been quiet.

L.A. Times Housing Market Slump Story

But, in my clients experience it's been slumpy (if that's even a word) quiet because we're not getting any good inventory on the market.

Working with 5 buyers would be very difficult if we had a lot of inventory, good inventory. I'd never get out of my car! I don't utilize a buyers agent, I do it all. But, I'm lucky (clients are too) if I'm getting in the car 2 - 3 times a week right now. And, gone are the days when I'd have 8 or 9 homes to show in one trek. It's out for one, maybe 2 at a time. And, all 5 are itching to buy! All of them!

So, I keep them motivated by constant communication, every week check in with some tid-bit or another. Something to say hello about. Something to check-in for. And, right from the start I've warned them it won't be a quick process.

I long for the days of more than 2 homes to show a buyer in one trip. It keeps their excitement up, makes them feel like they are getting somewhere.

And, today's market.....so influenced by distressed properties? I applaud them for the excitement they show when looking at stained carpet, broken doors, overgrown weeds...over and over again.



Never Give Up....Never Surrender

I'm so close to finishing the toughest transaction of my decade career. Sooo very close, I can practically taste it.....as they say.

Several times I just thought I should walk away. For my sanity. For my safety. For my happiness. For my health.

But I didn't. I just couldn't. People were counting on me. People trusted me. I couldn't let them down.

Many people would have walked away, some not. I have to admit I lost it on my client once. Only once. I needed to. I had taken it up to 'here'! I certainly felt better after. ;o)

I know that what goes around comes around. Do unto others as you would have them do unto you. But, I did absolutely nothing to deserve this challenge.

Did I?

But, I continued on, I persevered. And, for that I am very proud of myself. Very proud.

So, if you remember the movie.....

I never gave up, never surrendered.

And, I believe in the end, two families will be far better off than they were before they met me. And, I, of course, will have learned what to step away from in the future, and what to take on with the experience gained from all of this.



Who Pays For What?

In Real Estate contracts it behooves everyone to make certain, right from the start, who will pay for what. The seller, or the buyer?

If you're not sure there will be a cost for something, write it in anyways. If you think the lender may require a roof cert, write it in the beginning that whomever you want to pay for it, will pay for it. If there are questions about Home Warranty, ask for it up front.

Sometimes, we think we can negotiate that later. And, yes, sometimes this is true. And, a lot depends on the popularity of the property, who the seller is. Many factors.

But, if it's standard, ask up front. Get it worked out now. Nothing worse that all those little surprises a week before close of escrow to botch a deal!

With Short-Sales, we have come to expect that the lender won't pay for Home Warranties, 6% commissions, and more. But, with experience and know-how, a CDPE agent can get some of that covered.

Any agent, that tries hard enough, and knows enough. will generally guide their clients correctly from the get-go.

Hire a good agent, listen to what they say. They've sold many more REO's, Short-Sales and standard sales in this last year than you have in a lifetime!

CDPE - Another Designation... ;o)

I'm on day two of a 16 hour grueling class here in Valencia. Realty Executives organized it so as many of our agents that wanted to, could be educated and given additional tools to handle the market better.

Certified Distressed Property Expert

It's not the getting of the designation, it's the getting of the knowledge. I feel, and it was greatly confirmed yesterday, that we are going to be in this market for 5 - 7 more years. Too many loans, and loan mods, coming due to think otherwise.

While I've been dealing with Short-Sales for a few years now, it's best to have as much knowledge as possible. What they went over yesterday was much of what I already knew, but a few extra documents (among the mountain already required) were very good.

Today we are going to get to the nitty-gritty. Sheesh! In, according to the instructor, 'nauseating' detail.

But, we need that. There are so many homeowners that don't really know what their options are. What is the difference between BK, Foreclosure and Short-Sale. What the ramifications are to all of them.

And, while I'm not allowed to give legal or tax advice, I can certainly open a door that a homeowner may not have known existed.

Unfortunately, what we learn at this course may not be the same as next year or the year after. But, my fellow classmates, and myself, will certainly be better equipped than many agents attempting short-sales out there now.

If you know of anyone that is struggling and doesn't know where to turn, feel free to have them call me .....before they get a notice from their bank......I just may be able to help them. And, help them better with the additional tools and knowledge gained by this two day designation earning class.

I'm earning this designation to help troubled homeowners.



Are You Able To Escape Taxes On Short-Sale Gain ?

Most of us believe that the normal capital gains tax that has been deferred until 2012 would handle any misunderstanding as to if you owe taxes when you do a short-sale.

Example:

House is worth 400
You owe 500
Bank accepts the 400
Forgive 100

Back in the day, you'd owe taxes on that 100k forgiveness. We have had a reprieve on that and it's been extended.

Talk with your tax guy though if you did a short-sale last year and are expecting not to pay taxes on that 100k.

BETTER YET, TALK TO YOUR TAX PERSON BEFORE YOU EVEN CONSIDER DOING A SHORT-SALE.

Read the article linked here and decide if this is you, or if you are still safe from paying taxes on a 100k 'gain.

Passing The Test On Canceled Mortgage Debt Has Tax Rewards 

Whenever I discuss Short-Sales with a prospective client....'Talk to you Tax person and/or Financial Planner'. Needless to say, I have them sign a disclosure stating the same thing. But, I'm sure others may have forgotten to have this discussion.