Freddie Mac has produced a video that shows late-paying borrowers how gathering a few financial documents before calling a mortgage servicer can cut the time needed to determine their eligibility and process their application for a loan modification under the Making Home Affordable program or Freddie Mac's other workout initiatives.
Available in English and Spanish versions, the new Freddie Mac video, “Stop Foreclosure: Documents Your Lender Needs to Help You,” can be seen at Freddie Mac’s channel on YouTube at www.youtube.com/FreddieMacWeb. The two-minute video shows step-by-step which documents borrowers should have on hand when they call their servicer to discuss loan modifications. These documents can cut the time a servicer will need to understand the borrower's situation, determine his or her eligibility for a workout, and process the application.
Wednesday, July 22, 2009
California Dept. of Real Estate Issues Fraud Warning About Loan Modification Programs
The California Dept. of Real Estate (DRE) recently issued a fraud warning alerting consumers about loan modification scams and informing consumers of what they can do to protect themselves. The alert is available in both English and Spanish. Last July, the DRE had fewer than 10 complaints involving loan modification companies; today the department has 750 pending investigations. In addition, since last October, the DRE has filed more than 200 desist and refrain orders. A list of the companies and persons the DRE has filed an action against can be viewed at http://www.dre.ca.gov/cons_drs.asp.
It is worth noting that not all firms who collect advance fees for loan modification services do so illegally, the DRE said. In general, only licensed real estate brokers and attorneys operating within the scope of their license may collect advance fees. Real estate brokers must have their advance fee agreement reviewed by the DRE prior to its use to ensure it is compliant with real estate law.
C.A.R. advises members to carefully look at any program that may appear to have a government seal. C.A.R. is not aware of any government programs that have exclusive areas for which you have to pay to participate, and cautions all members to be on the alert for schemes seeking funds from REALTORS® or consumers with no value, or that may be misleading or unlawful.
It is impossible to list all of the Red Flags that might suggest fraud, since the scammers and con artists continue to modify and refine their stories, pitches and cons. They are ruthless and clever. Please be alert, be skeptical, and do your own homework.
And remember, Don’t Rush! You are always able to “slow down” or “pause”, and you should tell the provider of loan modification services that you want to check out their license status with the DRE or the California State Bar. Any service provider who objects to that request may have something to hide, like no credentials or license (or bogus credentials) – so be wary!!! Log on, Look em up, and Check em out!!! www.dre.ca.gov.
It is worth noting that not all firms who collect advance fees for loan modification services do so illegally, the DRE said. In general, only licensed real estate brokers and attorneys operating within the scope of their license may collect advance fees. Real estate brokers must have their advance fee agreement reviewed by the DRE prior to its use to ensure it is compliant with real estate law.
C.A.R. advises members to carefully look at any program that may appear to have a government seal. C.A.R. is not aware of any government programs that have exclusive areas for which you have to pay to participate, and cautions all members to be on the alert for schemes seeking funds from REALTORS® or consumers with no value, or that may be misleading or unlawful.
It is impossible to list all of the Red Flags that might suggest fraud, since the scammers and con artists continue to modify and refine their stories, pitches and cons. They are ruthless and clever. Please be alert, be skeptical, and do your own homework.
And remember, Don’t Rush! You are always able to “slow down” or “pause”, and you should tell the provider of loan modification services that you want to check out their license status with the DRE or the California State Bar. Any service provider who objects to that request may have something to hide, like no credentials or license (or bogus credentials) – so be wary!!! Log on, Look em up, and Check em out!!! www.dre.ca.gov.
Monday, June 1, 2009
Get your $8,000 tax credit in advance
From today’s Union-Tribune:
By ALAN ZIBEL, The Associated Press
12:24 p.m. May 29, 2009
WASHINGTON — Thousands of first-time homebuyers will be able to get short-term loans so they can quickly make use of a new $8,000 tax credit to pay for some of the costs of buying a home.
The Federal Housing Administration on Friday released details of a plan in which borrowers who use FHA loans can get advances from lenders that let them effectively receive the credit in advance, so they don’t have to wait to get the money from the Internal Revenue Service.
Most borrowers will still have to come up with the FHA’s required 3.5 percent down payment, unless they work through a state or local housing agency or an approved nonprofit. Ten states have such programs in place, according to the National Council of State Housing Agencies.
But there are many other potential uses, such as for closing costs and fees, or to beef up the down payment beyond the minimum level.
The FHA which insures about a quarter of new home loans, is projected to guarantee about 2.2 million loans in the next budget year.
Any buyer who has not owned a home in the past three years is considered a first-time buyer and eligible for the program. Borrowers can claim the credit by filing an amended 2008 tax return or can wait for their 2009 return.
The change “will present an enormous benefit for communities struggling to deal with an oversupply of housing,” Housing Secretary Shaun Donovan said in a statement.
The tax credit was included in the economic stimulus package signed by President Barack Obama in February. It is not available to individuals with incomes above $95,000 or couples with incomes above $170,000 and expires Nov. 30.
Real estate agents and homebuilders generally welcomed the change. Jerry Howard, chief executive of the National Association of Home Builders, called it a "great step in the right direction." On Wall Street, shares of such builders as Toll Brothers and D.R. Horton rose on the news.
Still, some real estate agents were concerned that many buyers won’t benefit at all if they can't use it for a down payment – a big hurdle for many first-time buyers.
By ALAN ZIBEL, The Associated Press
12:24 p.m. May 29, 2009
WASHINGTON — Thousands of first-time homebuyers will be able to get short-term loans so they can quickly make use of a new $8,000 tax credit to pay for some of the costs of buying a home.
The Federal Housing Administration on Friday released details of a plan in which borrowers who use FHA loans can get advances from lenders that let them effectively receive the credit in advance, so they don’t have to wait to get the money from the Internal Revenue Service.
Most borrowers will still have to come up with the FHA’s required 3.5 percent down payment, unless they work through a state or local housing agency or an approved nonprofit. Ten states have such programs in place, according to the National Council of State Housing Agencies.
But there are many other potential uses, such as for closing costs and fees, or to beef up the down payment beyond the minimum level.
The FHA which insures about a quarter of new home loans, is projected to guarantee about 2.2 million loans in the next budget year.
Any buyer who has not owned a home in the past three years is considered a first-time buyer and eligible for the program. Borrowers can claim the credit by filing an amended 2008 tax return or can wait for their 2009 return.
The change “will present an enormous benefit for communities struggling to deal with an oversupply of housing,” Housing Secretary Shaun Donovan said in a statement.
The tax credit was included in the economic stimulus package signed by President Barack Obama in February. It is not available to individuals with incomes above $95,000 or couples with incomes above $170,000 and expires Nov. 30.
Real estate agents and homebuilders generally welcomed the change. Jerry Howard, chief executive of the National Association of Home Builders, called it a "great step in the right direction." On Wall Street, shares of such builders as Toll Brothers and D.R. Horton rose on the news.
Still, some real estate agents were concerned that many buyers won’t benefit at all if they can't use it for a down payment – a big hurdle for many first-time buyers.
Thursday, April 30, 2009
Is Now a Good Time to Buy?
With the large reduction in prices of homes, many are wondering if now is the time to buy? My opinion is: depends.
If you are in a situation where you have a lot of pressure to purchase a home, it is possible to find deals. Problem is, the homes available in desirable neighborhoods at attractive prices tend to be short sales or foreclosures. Many people will not have the patience or flexibility buying a short sale will most likely require; the below market foreclosures the banks are trickling onto the market often have dozens of offers on them in days. Sometime investors come in with all cash offers putting buyers needing financing at a disadvantage. Many normal sellers still are adjusting expectations and are listing properties with the hope of selling at prices at levels seen during the bubble years. So if you need to buy now, and want to buy at a price you will not regret in a year or two, prepare to do some work finding short sales and foreclosures suitable for you and make multiple offers until one works out.
For those buyers that can wait for 6 months to 2 years, below are some articles that support the position that prices will continue to fall for the foreseeable future. No one knows the future, but after the reading the articles below, I believe that most buyers will be well severed by being patient and watching the market and using the time to save as big a down payment as possible.
FORECLOSURE ACTIVITY INCREASES 9 PERCENT IN FIRST QUARTER
4-7 — CA Foreclosures About to Soar…Again
If you are in a situation where you have a lot of pressure to purchase a home, it is possible to find deals. Problem is, the homes available in desirable neighborhoods at attractive prices tend to be short sales or foreclosures. Many people will not have the patience or flexibility buying a short sale will most likely require; the below market foreclosures the banks are trickling onto the market often have dozens of offers on them in days. Sometime investors come in with all cash offers putting buyers needing financing at a disadvantage. Many normal sellers still are adjusting expectations and are listing properties with the hope of selling at prices at levels seen during the bubble years. So if you need to buy now, and want to buy at a price you will not regret in a year or two, prepare to do some work finding short sales and foreclosures suitable for you and make multiple offers until one works out.
For those buyers that can wait for 6 months to 2 years, below are some articles that support the position that prices will continue to fall for the foreseeable future. No one knows the future, but after the reading the articles below, I believe that most buyers will be well severed by being patient and watching the market and using the time to save as big a down payment as possible.
FORECLOSURE ACTIVITY INCREASES 9 PERCENT IN FIRST QUARTER
4-7 — CA Foreclosures About to Soar…Again
Thursday, April 9, 2009
Making Home Affordable
Don't give you precious money to an unscrupulous loan modification company. Instead, visit www.makinghomeaffordable.gov and learn about programs to help you get a loan modification, special refinancing programs and tools to help you find out if you are eligible for these programs.
Are You Eligible?
Please use the self-assessment tools provided on www.makinghomeaffordable.gov to see if you are among the 7 to 9 million homeowners who may be able to benefit from Making Home Affordable.
Refinancing
Many homeowners pay their mortgages on time but are not able to refinance to take advantage of today’s lower mortgage rates perhaps due to a decrease in the value of their home.
Loan Modification
Many homeowners are struggling to make their monthly mortgage payments perhaps because their interest rate has increased or they have less income.
Need urgent help? Contact the Homeowner’s HOPE™ Hotline: (888) 995-HOPE
Are You Eligible?
Please use the self-assessment tools provided on www.makinghomeaffordable.gov to see if you are among the 7 to 9 million homeowners who may be able to benefit from Making Home Affordable.
Refinancing
Many homeowners pay their mortgages on time but are not able to refinance to take advantage of today’s lower mortgage rates perhaps due to a decrease in the value of their home.
Loan Modification
Many homeowners are struggling to make their monthly mortgage payments perhaps because their interest rate has increased or they have less income.
Need urgent help? Contact the Homeowner’s HOPE™ Hotline: (888) 995-HOPE
Tuesday, April 7, 2009
C.A.R. launches mortgage protection plan for first-time home buyers
The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) today launched the C.A.R. Housing Affordability Fund Mortgage Protection Program (C.A.R.H.A.F. MPP), for first-time home buyers.
Through the Housing Affordability Fund Mortgage Protection Program, first-time home buyers who lose their jobs due to layoffs may be eligible to receive $1,500 per month, for six months, to help make their mortgage payments. A qualified co-buyer also can participate in the program, and receive a monthly benefit of $750 per month for up to six months. Program benefits also include coverage for accidental disability and a $10,000 death benefit.
C.A.R.’s Housing Affordability Fund is dedicating $1 million toward its Mortgage Protection Program, and estimates that as many as 3,000 families will benefit from the program this year.
To qualify for the Mortgage Protection Program, applicants must:
· Be a first-time home buyer – someone who has not owned a home in three or more years
· Open escrow April 2, 2009, or later, and close on or before Dec. 31, 2009
· Use a California REALTOR® in the transaction
· Purchase the property in California
· Be a W-2 employee (cannot be self-employed)
To apply for the program, home buyers must request an application for the H.A.F. Mortgage Protection Program from their REALTOR®.
Through the Housing Affordability Fund Mortgage Protection Program, first-time home buyers who lose their jobs due to layoffs may be eligible to receive $1,500 per month, for six months, to help make their mortgage payments. A qualified co-buyer also can participate in the program, and receive a monthly benefit of $750 per month for up to six months. Program benefits also include coverage for accidental disability and a $10,000 death benefit.
C.A.R.’s Housing Affordability Fund is dedicating $1 million toward its Mortgage Protection Program, and estimates that as many as 3,000 families will benefit from the program this year.
To qualify for the Mortgage Protection Program, applicants must:
· Be a first-time home buyer – someone who has not owned a home in three or more years
· Open escrow April 2, 2009, or later, and close on or before Dec. 31, 2009
· Use a California REALTOR® in the transaction
· Purchase the property in California
· Be a W-2 employee (cannot be self-employed)
To apply for the program, home buyers must request an application for the H.A.F. Mortgage Protection Program from their REALTOR®.
Buy in 2009 and you can receive a tax credit up to $8,000!
Have questions about the tax credit? Here are some answers:
When do I need to purchase to qualify?
If you buy a home between Jan. 1 and Dec. 1 this year and close escrow during these dates, you will qualify for a tax credit up to $8,000 - as long as it is your primary residence and you meet the simple requirements.
How does the law define "first-time homebuyer"?
The law defines "first-time homebuyer" as a buyer who has not owned a principal residence during the three-year period prior to the purchase.
What are other requirements to qualify?
All U.S. citizens who file taxes are eligible to participate. An income limit of $75,000 a year for individuals and $150,000 a year for joint filers also applies.
How do I apply for the credit?
Taxpayers should use IRS Tax Form 5450 to claim the first-time homebuyer tax credit.
Does the credit have to be repaid?
No. Unlike a similar tax credit passed in 2008, this $8,000 tax credit does not have to be repaid to the IRS.
When do I need to purchase to qualify?
If you buy a home between Jan. 1 and Dec. 1 this year and close escrow during these dates, you will qualify for a tax credit up to $8,000 - as long as it is your primary residence and you meet the simple requirements.
How does the law define "first-time homebuyer"?
The law defines "first-time homebuyer" as a buyer who has not owned a principal residence during the three-year period prior to the purchase.
What are other requirements to qualify?
All U.S. citizens who file taxes are eligible to participate. An income limit of $75,000 a year for individuals and $150,000 a year for joint filers also applies.
How do I apply for the credit?
Taxpayers should use IRS Tax Form 5450 to claim the first-time homebuyer tax credit.
Does the credit have to be repaid?
No. Unlike a similar tax credit passed in 2008, this $8,000 tax credit does not have to be repaid to the IRS.
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