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Showing posts with label MAryland Real Estate. Show all posts
Showing posts with label MAryland Real Estate. Show all posts
Friday, February 11, 2011
Wednesday, August 13, 2008
The New Housing Bill. . Do You Qualify?
Fernando, what about the new Housing Bill signed recently by the President. .Do I qualify?
Please understand the Housing Bill that recently passed to help current homeowners in refinancing their home to save them from foreclosure.. . Has many flaws but it will be some help for a few homeowners that may qualify.
In a nutshell it means that you could qualify for an FHA refi for 90% of the CURRENT value of your home. The caveat here is that your bank has to agree to do the refinancing. The bank will weight the consequences in accepting such a major default from your original loan.
Take the following test if you qualify. . .
TEST #1 the bank will ask themselves. .Could we get more money if we just foreclosed?
Remember that NO BANK has agreed to participate in this program. . This is on a case by case basis.
TEST #2 Your loan must have originated between the daters of January 2005 and June 2007
TEST #3 You should be spending more than 31% of your gross monthly income on mortgage debt to be eligible
Test #4 You can be up to date on your existing mortgage or in default, but either way you must prove that you can’t keep paying your existing mortgage
Test #5 You can’t have any other debt in your home. .like a Home Equity Loan, and in addition you will be NOT BE ABLE to take an equity loan for at least 5 years. There are certain exemptions like you may be allowed to borrow money to repair your house.
Test #6 This program will begin on October 1, 2008 and sunset on September 30, 2011.
If you pass this test then. . .
You will need to apply with any FHA-approved lender to start the process.
Please remember that this is a voluntary program and no lender is obligated to give you this break. The key thing here is that “The bank has to be convinced that they could LOSE more money if a foreclosure is eminent.
Each loan will have to pass underwriting from an FHA lender and you will still have to qualify based on your income and maximum FHA loan limits. (This changes depending where your home is located in) Check with your lender if you have a high end home.
Costs Associated with these loans.
Loan origination fees will vary which lender you use. They’re should be little up-front charges here but. .
Two major things to take in consideration
#1 you will be paying insurance premium guaranteeing the loan.
#2 you will be sharing the profits from the sale of your home if you decide to sell. .
Before one year: You will have to give them 100% of the profit
After year one, you will pay 90% of the profits
After year two, you will pay 80% of the profits
After year three, you will pay 70% of the profits
After year four, you will pay 60% of the profits
After year five, you will pay 50% of the profits. . And it will stay there until you sell it.
These are the major points about this housing bill.
The required Disclaimer is warranted to end this article. . So here it is.
Disclaimer: Best efforts have been used to prepare the material presented. The author Fernando Herboso , Herboso & Associates and Choice Real Estate do not warrant that this information is 100% accurate. Information presented in this article was taken from various websites including HUD.GOV. Please consult with a FHA approved lender and a certified accountant to learn of the full ramifications of this program to your finances. The author and Choice Real Estate may not be held liable, in any circumstance, for damages or loss, including but not limited to this article and its contents.
Please understand the Housing Bill that recently passed to help current homeowners in refinancing their home to save them from foreclosure.. . Has many flaws but it will be some help for a few homeowners that may qualify.
In a nutshell it means that you could qualify for an FHA refi for 90% of the CURRENT value of your home. The caveat here is that your bank has to agree to do the refinancing. The bank will weight the consequences in accepting such a major default from your original loan.
Take the following test if you qualify. . .
TEST #1 the bank will ask themselves. .Could we get more money if we just foreclosed?
Remember that NO BANK has agreed to participate in this program. . This is on a case by case basis.
TEST #2 Your loan must have originated between the daters of January 2005 and June 2007
TEST #3 You should be spending more than 31% of your gross monthly income on mortgage debt to be eligible
Test #4 You can be up to date on your existing mortgage or in default, but either way you must prove that you can’t keep paying your existing mortgage
Test #5 You can’t have any other debt in your home. .like a Home Equity Loan, and in addition you will be NOT BE ABLE to take an equity loan for at least 5 years. There are certain exemptions like you may be allowed to borrow money to repair your house.
Test #6 This program will begin on October 1, 2008 and sunset on September 30, 2011.
If you pass this test then. . .
You will need to apply with any FHA-approved lender to start the process.
Please remember that this is a voluntary program and no lender is obligated to give you this break. The key thing here is that “The bank has to be convinced that they could LOSE more money if a foreclosure is eminent.
Each loan will have to pass underwriting from an FHA lender and you will still have to qualify based on your income and maximum FHA loan limits. (This changes depending where your home is located in) Check with your lender if you have a high end home.
Costs Associated with these loans.
Loan origination fees will vary which lender you use. They’re should be little up-front charges here but. .
Two major things to take in consideration
#1 you will be paying insurance premium guaranteeing the loan.
#2 you will be sharing the profits from the sale of your home if you decide to sell. .
Before one year: You will have to give them 100% of the profit
After year one, you will pay 90% of the profits
After year two, you will pay 80% of the profits
After year three, you will pay 70% of the profits
After year four, you will pay 60% of the profits
After year five, you will pay 50% of the profits. . And it will stay there until you sell it.
These are the major points about this housing bill.
The required Disclaimer is warranted to end this article. . So here it is.
Disclaimer: Best efforts have been used to prepare the material presented. The author Fernando Herboso , Herboso & Associates and Choice Real Estate do not warrant that this information is 100% accurate. Information presented in this article was taken from various websites including HUD.GOV. Please consult with a FHA approved lender and a certified accountant to learn of the full ramifications of this program to your finances. The author and Choice Real Estate may not be held liable, in any circumstance, for damages or loss, including but not limited to this article and its contents.
Sunday, April 13, 2008
What Percentage Of Sales Price for a Short Sale ?
What Percentage OFF Sales Price for a Short Sale ?
I've been asked many times about this. The short answer is : Depends
Here are 3 things that will determine this question:
#1 Are there any similar comparables. If two houses are alike and one SOLD for $100,000 and the other one is a short sale. The percentage of the sales price from this comparable should be less that the amount it will cost the bank to foreclose the property. If the cost to foreclose a property from XYZ Bank is $20,000. .then an offer of $81,000 will make sense to the bank. An offer below $80,000 will not make sense to be accepted by the bank.
#2 Of course there are many conditions to be in line before a short sale can be accepted. The number 2 reason to validate a percentage of the sales price during a short sale is by knowing if there are two or only one bank holding the note. From the last similar comparables you can deduct that bank #1 holds 80% of the mortgage. .and bank #2 gets the "short" end of the stick
If bank #1 can get their 80%. . bank #2 will try to get whatever they can get. . .after they realize that the property value doesn't give them a chance to get anything. When bank #2 is the same bank. . they maybe willing to write it off.
#3 The percentage off the sales price when it is a short sale will also be determined by BPO.
The Buyer Broker Opinion plays a huge role in determining what percentage off you will be paying when buying a short sale. Proving to the bank that the property needs major work could get you an offer accepted 30 to 40% below the last comparables.
As a listing agent for close to 20 active short sales, I ask my dear Realtor friends that I don't care how low your offer can be. ..I will submit it to the bank. . .as long as you can send me a comparable that supports your offer amount.
I've been asked many times about this. The short answer is : Depends
Here are 3 things that will determine this question:
#1 Are there any similar comparables. If two houses are alike and one SOLD for $100,000 and the other one is a short sale. The percentage of the sales price from this comparable should be less that the amount it will cost the bank to foreclose the property. If the cost to foreclose a property from XYZ Bank is $20,000. .then an offer of $81,000 will make sense to the bank. An offer below $80,000 will not make sense to be accepted by the bank.
#2 Of course there are many conditions to be in line before a short sale can be accepted. The number 2 reason to validate a percentage of the sales price during a short sale is by knowing if there are two or only one bank holding the note. From the last similar comparables you can deduct that bank #1 holds 80% of the mortgage. .and bank #2 gets the "short" end of the stick
If bank #1 can get their 80%. . bank #2 will try to get whatever they can get. . .after they realize that the property value doesn't give them a chance to get anything. When bank #2 is the same bank. . they maybe willing to write it off.
#3 The percentage off the sales price when it is a short sale will also be determined by BPO.
The Buyer Broker Opinion plays a huge role in determining what percentage off you will be paying when buying a short sale. Proving to the bank that the property needs major work could get you an offer accepted 30 to 40% below the last comparables.
As a listing agent for close to 20 active short sales, I ask my dear Realtor friends that I don't care how low your offer can be. ..I will submit it to the bank. . .as long as you can send me a comparable that supports your offer amount.
Wednesday, January 23, 2008
Great News For Short Sales
Tax implications for the borrower was very significant that a short sale would not be in the borrower’s best interest. Before a short sale was contemplated in 2007, I strongly recommended that the borrower seek the advice of a professional tax advisor.
Generally speaking, any relief of indebtedness was supposed to be included in the sellers gross income for the tax year.
The great news is that as of January 4th, 2008 Congress and the President pass into law that a short sale will not be liability for the seller period. Read It Here
There are some exceptions to this rule , please contact me if you have any questions.
www.ReallyNiceHomes.com
Generally speaking, any relief of indebtedness was supposed to be included in the sellers gross income for the tax year.
The great news is that as of January 4th, 2008 Congress and the President pass into law that a short sale will not be liability for the seller period. Read It Here
There are some exceptions to this rule , please contact me if you have any questions.
www.ReallyNiceHomes.com
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