New Federal Housing Administration loan assistance

New FHA foreclosure loan assistance

Owners with FHA loans should soon be eligible for payment modifications under a new government program. Read more

Countrywide’s promised loan relief falling short for many

Countrywide loan relief falls short?

The defunct subprime mortgage giant promised $1B to struggling Floridians, but critics say it’s failing to deliver the goods. Read more.

Governor signs $8K homebuyer credit into law

TALLAHASSEE, Fla. – May 27, 2009 – Gov. Charlie Crist signed the budget bill (SB 2600) today that lays out how the state will spend its $65.6 billion in the fiscal year that starts July 1. Included is $30.1 million for the Florida Homebuyer Opportunity Program, which will help with downpayment assistance.

Beginning July 1, those who quality for the federal $8,000 first-time homebuyers tax credit will be able to apply for downpayment assistance before they close on the purchase of their home, and then repay the amount borrowed when they get their tax refund. The program will operate through local county housing administrators, though details are still being worked out.

The state spending plan passed today also includes the following for real estate-related programs:

• Up to $400,000 to prevent, combat and publicize the dangers of unlicensed real estate activity in Florida.

• $540,000 to continue and complete a study to make recommendations on passive strategies on nitrogen reduction that complement the use of onsite wastewater treatment systems.

• $3 million in the Real Estate Trust Fund for the Education and Research Foundation.

• A reduction in the eviction filing fees from $265 to $180 – the only fee reduction in the 2009-10 budget, and one with a negative fiscal impact of up to $36 million.

© FLORIDA ASSOCIATION OF REALTORS

Treasury Announces Short-Sale Support

The U.S. Treasury Department last week unveiled a plan designed to streamline and encourage short sales, a move RE/MAX leaders have been advocating for some time.

Under provisions of the newly created “Foreclosure Alternatives Program,” the process will soon include standardized documentation, cash incentives to lenders and moving allowances for homeowners.

RE/MAX International supports the government’s action.

“We applaud the administration for creating the Foreclosure Alternatives Program, which promotes the short-sale process,” says RE/MAX International Chairman and Co-Founder Dave Liniger (ABR, CRB). ”We’ve been talking with key lenders and government officials for months about the short-sale issue and couldn’t be more pleased that our hard work has finally paid off.”

Here’s a Treasury Department fact sheet about the plan, as well as a release from the National Association of Realtors.

Because RE/MAX International leadership recognized the viability of short sales as an important piece of the foreclosure puzzle, more than 5,000 Associates already have been trained through the Certified Distressed Property designation course, which covers the process in detail. The next airing on RSN is June 9-10.

“We’ve been preparing for, and pushing for, this type of action,” says Mike Ryan, RE/MAX International Senior Vice President of Media Training. “We’ve felt for a long time that short sales provide a lifeline for homeowners who can’t afford to stay in their homes, even with a loan modification. With a short sale, the sellers get out of a bad situation, the banks save on costs and the neighborhood avoids the many problems associated with vacant, foreclosed properties.”

Ryan says it’s more important than ever for Associates to learn how to handle short sales, which have traditionally been avoided by agents unwilling to navigate the long, frustrating and often unsuccessful terrain.

“It’s understandable why many Associates have been reluctant to pursue this business. But with distressed properties accounting for half of U.S. sales and a whole new level of attention now being put on making short sales easier to complete, it really is time to let go of any reservations,” Ryan says. “With the Treasury Department’s involvement, we’re going to see a lot more emphasis on short sales, through lenders, the media and the public. Our people need to be as educated as they can be about this segment of the market.”

Two days after the Treasury announcement, The New York Times published a story, headlined “Lenders More Open to Short Sales,” that included this passage:

“Mr. Mitchell of Lynx says short sales are often the best approach, even for homeowners considering a new loan to save the home. ‘It’s gotten to the point where people understand that sometimes you have to start over,’ he said. ‘A loan modification might help you in the short term, but sometimes what people need to do is get out completely.’”

The perception of short sales is clearly changing, Ryan says.

“It’s up to us, and each individual Associate and brokerage, to be prepared,” he says. “The foreclosure problem isn’t going away anytime soon, and in fact will probably get worse before it gets better. But short sales provide a source of relief – and we want our agents to be able to close them better than anyone.”

Feds plan ’surge’ in mortgage fraud cases

TAMPA – Faced with rampant mortgage fraud that has helped pull the economy into a ditch, federal authorities are in the midst of a “surge” in investigations that they expect will increase prosecutions tenfold in the next year.

 

Read full story: http://www2.tbo.com/content/2009/may/07/feds-florida-ground-zero-mortgage-fraud/news-money/

Turning short sales into big profit

We came across this Article that was on the front page of the Tampa Tribune and we thought it was worth getting on our site:

http://www2.tbo.com/content/2009/may/03/na-turning-shortsales-into-big-profit/

Compliments to Writer! This article has caused people to question some of the activities that have recently been happening in our area. Let me start off by saying ethically the listing agent represents the Seller. We can facilitate both sides of a sale and represent the Buyer and Seller at the same time. But what is happening here the listing agent is not submitting the highest and best offer to the Original Sellers Lender. We have been doing short sales for nearly 3 years and have been quite successful at assisting our clients in getting the sale approved with no adversities.

All the things that some agents are hiding behind are legal in the way they were implemented.  The one thing that is questionable is CAN IT APPLY IN A SHORT SALE? Since our goal in a short sale is to get the best offer with the best terms for our Client, so that they can get out of the bad situation they are in. I wonder if that is the listing agent or “Investors” ultimate goal. Or is it just to make as much money off one sale.

Ultimately this is a bad day for the True Professionals in the field and we will have to deal with the ramifications of these type of people. What a shame it is. We have spoken with several banks and they will not accept Option or Even Assignable Contracts. So I hope all that are involved in this type of practice have put some of the cash they made away for a rainy day, because it is coming soon.

Things to consider. Is the bank seeing the end buyer’s offer? If there is a contract; can the home remain Active in the Local MLS System? Is it really a Short Sale to the end buyer? The answer to these questions would probably be NO! And that is not a good answer.

And just a few more things to think about. Whose money is funding the “Investors” Closing? Are all Closing Costs Paid on” Investors” purchase from the Bank? Or is just the end buyer’s sale? I am sure the County would like to get paid on a sale that happened. Why would the bank accept less from the investor when there is an end buyer who is willing to pay more (On the Same Day!) This all sounds kind of fishy to me. The truth of the matter is that there are good and bad people in every career out there and let’s hope that this does not tarnish the good ones.  

Oh we thought we would add that we submitted an offer for one of our customers to purchase a home in Valrico Last night, it was full price $130,000.00, and buyers are pre-approved up to $160,000.00 and we received a written message that said “Nick & Cindy- Per our discussion earlier. The seller is not accepting FHA on this particular property. If buyer can secure other financing, please let me know.’

I asked when we spoke on the phone what does this mean.  I was told by the agent “This was a flip with an option contract and due to the seasoning rule for FHA; they were not accepting FHA Offers”

 So this home cannot be purchased by our customer because they are entitled and choose to use an FHA mortgage.  All so an “Investor” can make their money on the flip. It is a sad day.

Pending home sales up 3.2%, housing affordability near record

WASHINGTON – May 4, 2009 – Pending home sales rose in March with many first-time buyers taking advantage of historically good housing affordability conditions, according to the National Association of Realtors® (NAR).

The Pending Home Sales Index, a forward-looking indicator based on contracts signed in March, increased 3.2 percent to 84.6 from a level of 82.0 in February, and it’s 1.1 percent higher than March 2008’s 83.7.

“This increase could be the leading edge of first-time buyers responding to very favorable affordability conditions and an $8,000 tax credit, which increases buying power even more in areas where special programs allow buyers to use it as a downpayment,” says Lawrence Yun, NAR chief economist. “We need several months of sustained growth to demonstrate a recovery in housing, which is necessary for the overall economy to turn around.”

NAR’s Housing Affordability Index remained near record highs. The affordability index was 166.7 in March – down from an upwardly revised record of 174.4 in February due to higher home prices in March. The index remains 30.8 percentage points higher than a year ago. The HAI is a broad measure of housing affordability using consistent values and assumptions over time, which examines the relationship between home prices, mortgage interest rates and family income. Tracking began in 1970.

The Pending Home Sales Index in the South rose 8.5 percent to 93.2 in March and is 7.7 percent above a year ago. In the West the index increased 3.9 percent to 93.1 and is 1.7 percent higher than March 2008. The index in the Northeast fell 5.7 percent to 59.5 in March and is 24.1 percent below a year ago. In the Midwest the index slipped 1.0 percent to 82.3 but is 8.2 percent higher than March 2008.

NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage in Dallas-Fort Worth, said the increase in buying power is quite remarkable. “Compared to a year ago, the typical family can pay much less in mortgage costs for the same home, or buy a better home without necessarily increasing their monthly payment,” he said. “For buyers who’ve been on the sidelines and have good jobs, the market has never looked more favorable. Homeownership has always offered immediate benefits and long-term value, but the advantages in today’s market are unique.”

A median-income family, earning $61,100, could afford a home costing $291,600 in March with a 20 percent downpayment, assuming 25 percent of gross income is devoted to mortgage principal and interest. Affordability conditions for first-time buyers with the same income and small downpayments are roughly 80 percent of that amount. The affordable price was notably higher than the median existing single-family home price in March, which was $174,900.

© 2009 FLORIDA ASSOCIATION OF REALTORS®

Senate passes bill targeting mortgage fraud

MORTGAGE FRAUD

The U.S. Senate voted Tuesday to hire hundreds more FBI agents and prosecutors to investigate the estimated 5,000 allegations of mortgage fraud reported each month. The Senate bill is estimated to cost more than $265 million a year for the next two years, but fines and penalties could make the program pay for itself.

Read the full story:
http://www.floridarealtors.org/NewsAndEvents/n5-042909.cfm

U.S. House panel to target predatory’ mortgage lending

PREDATORY LENDING

If passed by Congress, the Mortgage Reform and Anti-Predatory Lending Act of 2009 would end bonuses for brokers who steer borrowers into higher-priced loans, and require brokers to confirm borrowers’ income. Proponents say it’s a simple goal: Make sure homeowners can actually afford their loans.

Read the full story:
http://www.floridarealtors.org/NewsAndEvents/n2-042309.cfm