HARP changes put refinancing in reach of more homeowners – Appeal-Democrat: Real Estate

HARP changes put refinancing in reach of more homeowners

When the federal Home Affordable Refinance Program HARP launched in 2009, millions took advantage, but many other homeowners found they couldn’t qualify to refinance their underwater mortgages. Today, significant enhancements have made the program more accessible for homeowners and a great opportunity to lower payments or build equity faster.If you owe as much or more on your home than its current value, you’re considered “underwater” or “upside-down” on your mortgage. For some homeowners, the situation has led to foreclosure. Others, however, have stayed current on their mortgage payments, and those are the people HARP is intended to help.You may be eligible for HARP if: You are current on your mortgage. Fannie Mae or Freddie Mac backs or owns your mortgage, and they acquired your mortgage on or before May 31, 2009. Use Fannie Mae’s and Freddie Mac’s online tools to find out. The mortgage is for your primary home, a single-family second home or a one- to four-unit investment property.

via HARP changes put refinancing in reach of more homeowners – Appeal-Democrat: Real Estate.

When is a Short Sale Not a Short Sale?

True story…Seller is an elderly widow.  Her husband became quite ill and they spent every penny of their savings trying to return him to health. After his death she did the best she could to hang on and make things work. She rented out all the extra bedrooms, turned the thermostat down, and crimped on every expenditure. It was a slowly losing battle and finally she just could not do it any longer. She put the house on the market as a short sale.

The house was listed at $229K, she owed a little over $300K to the bank.  Her home had lots of delayed maintenance but was in a good area of Santa Rosa and was basically sound construction.  7 days and 19 offers later, she accepted an offer for $345K curing her short sale and paying all her expenses related to the sale.  She also side-stepped a potential credit issue.

If you haven’t taken a look lately, there is a huge demand for homes in the $500s and below, but very little on the market.  The offers are aggressive…cash, as is, no appraisal and a fast close.  This could be your chance to cure your financial situation and get out from under your mortgage.

Less than two miles from that house and within the last 3 months this happened…

  • 429 Bosley (South of A neighborhood), an early 1900s bungalow listed for $229K as a short sale got 33 offers and finished up in contract at $329K.
  • 521 Hendley (Burbank Gardens), listed at $249K, in contract in one day, closed in 27 days at $255K.
  • 410 Brown (Burbank Gardens), listed at $249K, it had a price increase to $289K within 3 days because of the intense interest. Went into contract in 7 days with multiple offers.

Call me and I can tell give you an idea of the market value of your home.  Good decisions require good information.

The ‘Perfect Storm’ for Short Sales Continues in 2013

Like 2012, 2013 may just continue to be the perfect storm for doing a Short Sale:

  • Sonoma County’s available inventory of homes for sale continues to be the lowest in years.
  • Competition for what inventory does exist has pushed up prices and turned the tables, making it a Sellers Market.
  • Bank and Government programs are getting more and more favorable for the Distressed Homeowner who needs to sell.
  • Lenders have too many foreclosures on their books, making Short Sales a better alternative for them.
  • Short Sales are getting, well, shorter because of improved operating standards by the banks and programs by the government.
  • The option to Short Sale is easier on your credit than a foreclosure, making it possible to buy another home sooner.

And the Number One Reason:  The Forgiveness of Debt Tax Relief Act has been extended to the end of 2013 saving you literally tens of thousands of dollars you would otherwise owe the IRS in Federal Income Tax after a Short Sale.

Effective Today Fannie & Freddie Get a Green Light to Save You Another Step

Fannie Mae Reaches Short Sale and Deed-in-Lieu Delegation Agreements with Mortgage Insurers

WASHINGTON, DC – Fannie Mae (FNMA/OTC) announced today that it has reached delegation agreements with all of its mortgage insurer counter parties so that servicers can complete short sales and deeds-in-lieu of foreclosure without seeking approval from the insurer.  These agreements will further streamline the foreclosure prevention process and allow short sales and deeds-in-lieu to be completed more efficiently.

“Short sales and deeds-in-lieu are important tools to prevent foreclosures and help struggling borrowers,” said Leslie Peeler, senior vice president, National Servicing Organization, Fannie Mae. “These delegation agreements create an even more streamlined process that will ultimately help more families avoid the costly effects of foreclosure and benefit taxpayers.  We are pleased that the mortgage insurance companies have stepped up to the plate with us to help more homeowners.”

Previously, Fannie Mae had individual delegation agreements with the majority of its top mortgage insurer counterparties.  Now, a standard delegation agreement has been reached with all nine mortgage insurers, making the approval process more consistent and efficient for servicers and borrowers.

The new delegation agreements allow servicers to approve any short sale or deed-in-lieu that meets Fannie Mae’s requirements without individual mortgage insurance approval.

These agreements are an important achievement in Fannie Mae’s efforts to stabilize neighborhoods and have been established with CMG Mortgage Insurance Company, Essent Guaranty, Inc., Genworth Mortgage Insurance Corporation, Mortgage Guaranty Insurance Corporation, PMI Mortgage Insurance Co., Radian Guaranty Inc., Republic Mortgage Insurance Company, Triad Guaranty Insurance Corporation, and United Guaranty Mortgage Insurance Company.  All delegation agreements will be effective as of November 1, 2012.

Borrowers can visit http://www.knowyouroptions.com/ for foreclosure prevention information and resources, including how to contact Fannie Mae’s twelve Mortgage Help Centers across the country.  Through the first six months of 2012, Fannie Mae completed 142,987 loan workout solutions, including 46,226 short sales and 7,509 deeds-in-lieu of foreclosure.  Earlier this year, Fannie Mae announced new short sale guidelines and new short sale timelines.

Fannie Mae exists to expand affordable housing and bring global capital to local communities in order to serve the U.S. housing market. Fannie Mae has a federal charter and operates in America’s secondary mortgage market to enhance the liquidity of the mortgage market by providing funds to mortgage bankers and other lenders so that they may lend to home buyers. Our job is to help those who house America.

via News Release – Fannie Mae Reaches Short Sale and Deed-in-Lieu Delegation Agreements with Mortgage Insurers | Fannie Mae.

Principal “Curtailment” for Underwater Home Owners

If you fit this description:

  • Have low to moderate income
  • Owe more than your house is worth
  • Live in your home
  • Are delinquent, or have a hardship that puts you at risk of default
  • Have a mortgage balance of less than $729,750

Read this article….

Principal relief for stressed homeowners

A limited number of underwater homeowners in California will soon be able to get principal reductions of up to $100,000 apiece on Fannie Mae and Freddie Mac loans through the federally funded Keep Your Home California program.

The federal agency that oversees Fannie and Freddie has steadfastly refused to allow permanent principal reduction on loans they own or guarantee on the grounds it would cost taxpayers money. But in mid-September, Fannie and Freddie told servicers they could immediately begin accepting money for principal reductions from programs financed by the U.S. Treasury’s Hardest Hit Fund, including Keep Your Home California.

Fannie’s and Freddie’s willingness to accept money from Hardest Hit Funds does not signal a change of heart on the part of their regulator, the Federal Housing Finance Agency. Lest anyone get the wrong idea, Freddie says it will allow funds to be used for “principal curtailment.”

Read the rest here…

via Principal relief for stressed homeowners – SFGate.

Awesome New Site for Fannie Mae Mortgage Holders!

Fannie Mae site helps you find your way through…

Confused about what options might be available to you and if you even qualify for them?  Fannie Mae’s Know Your Options site will get you rolling in no time!

First, to be sure your mortgage is owned by Fannie Mae, start with the Loan Look Up on the very top menu line.  Once you’ve confirmed this, you have a literal plethora of assistance in sorting out what options may be open to you.

Their Option Finder makes this all easy!  You answer simple, focused questions and come out the other end with your options!  If there is something you are not sure about, you can contact them for assistance from a real person!  

Included are…

  • How to refinance with little to zero equity
  • How to modify your loan
  • Options to stay in your home
  • Options to leave your home
  • What to do if you are already in foreclosure
  • A Resource list for Mortgage Assistance & Government Programs that may apply

Another great feature are the calculators made available on the site so that you can get an estimate of your monthly payments would be on a modification or refinance.

Check it out now at www.knowyouroptoins.com!

5 Things To Do Immediately After Getting a Notice of Default

In California, once the notice of default has been recorded, you have approximately 120 days to save your home before it is auctioned.  Once you get the notice in the mail don’t waste any time!

Here are 5 things to do immediately….

  1. Call your lender and ask them what solutions they have.  Banks are moving away from foreclosures and new programs are coming along all the time. The best way to be sure you have the latest information is to call the lender. If you want to keep your home, begin the process under as many avenues as are available, including non-profit programs.
  2. Find out who owns your mortgage.  Even if your loan is with BofA, it could be owned by Fannie Mae or Freddie Mac (Question #9 in FAQ),   If it is, you may qualify for a government program and be able to refinance without an appraisal (HARP2), to modify your loan (HAMP), or to do short sale and get a cash incentive to help with relocation expenses. (HAFA).
  3. Get professional advice from your tax preparer and an attorney about your financial options and the effect a short sale would have on your finances.
  4. Operate on the 120 day timeline.  This is the typical timeline from Notice of Default to foreclosure and then auction.  In that 120 day period is your opportunity to a) get a loan modification consent from the bank, b) short sale your property, or c) find a way to bring your mortgage current.
  5. Contact a certified short sale Realtor, such as myself, if you want or need to sell your home. Get that ball rolling as soon as possible.
Until the Home Owner’s Bill of Rights takes effect on January 1, 2013, the banks are under no legal obligation to stop the foreclosure process, even if they have told you they would work with you on a loan modification.
 
One last thing:  That Notice of Default you got; it is public record. So, put your guard up regarding people who may try to contact you.  Some of them may be legitimate, but some may be working a scam

 

B of A Takes Pilot Short Sale Relocation Assistance Program Nationwide

A pilot program begun in Florida is now being taken nationwide by Bank of America.  The program provides home owners with relocation assistance when they complete a Short Sale.

Amounts run from $2,500 to $30,000 depending on the situation, the value of the property, and the decision of the investor who owns the loan.

Here’s the criteria:

  • Must have pre-approval for a short sale
  • Must participate in either the government’s HAFA (Home Affordable Foreclosure Alternative) short sale program or B of A’s proprietary short sale program
  • Process must be initiated by 2012
  • Sale must be completed by September 13, 2013

Note:  Short Sales already in escrow are not eligible for this program.

Don’t Throw that Letter Away! It May Have $150,000 in It!

Bank of America Offers Principal Reductions to 200,000 Homeowners

A select group of struggling mortgage borrowers are about to get an offer that sounds too good to be true. Executives at Bank of America say they will begin mailing 200,000 letters offering certain customers mortgage principal reductions.

If people get these things and toss them, they won’t be eligible,” says Ron Sturzenegger, the Bank of America executive charged with providing solutions to borrowers in need of mortgage assistance.

But the offer is real, and eligible borrowers could get as much as $150,000 knocked off the balance of their mortgages.

It is all part of the $25 billion settlement reached this year between federal and state agencies and the nation’s five largest mortgage servicers over fraudulent foreclosure document processing (so-called “robo-signing”.)

Via:  Bank of America Offers Principal Reductions to 200,000 Homeowners – CNBC.

And, watch this video:

Tax Break that Could Save You Thousands is Due to Expire!

Important Federal tax break for some homeowners set to expire this year

For the last five years, the federal government has given tax breaks to distressed homeowners who work out a deal with their lender to reduce or release mortgage debt. But unless members of Congress agree to an extension, starting next year any break you get on your mortgage debt will be considered taxable income.

In distressed mortgage situations like we’re seeing across the country, the lender’s financial loss is considered a financial benefit to the homeowner who gets out of paying their full debt. In a short sale for example, where your mortgage balance is $300,000 and your home sells for $240,000, the outstanding balance of $60,000 is considered forgiven debt and would ordinarily be ruled taxable income.

But since 2007, under the Mortgage Forgiveness Debt Relief Act, forgiven debt has been tax free. That’s set to change after the end of this year.

“As it stands, mortgage debt that’s forgiven is not going to be treated as taxable income here in 2012,” said Greg McBride of Bankrate.com. “But, it remains to be seen whether that’s going to be continued into 2013 or not.”

McBride advises anyone facing a distressed mortgage situation to get things worked out before the end of the year, in case the federal tax break is not extended so you’re not caught by surprise.

What qualifies for the income tax break? Short sales, loan modifications, deed in lieu transactions — where you turn your home over to the bank — and in many cases, foreclosure. Just keep in mind the Debt Relief Act only applies to principle residences. No rental property or second homes.

And don’t even think about getting a break on canceled credit card debt or other consumer loans.

“For somebody who is currently going through some sort of program where they’re having debt that’s forgiven, if it’s not real estate debt, there’s a real good chance you’re going to get a 1099 form at the end of the year that says you now have to pay taxes on whatever debt was forgiven, because it’s treated as income,” McBride explained.

The U.S. Treasury Department is urging mortgage services to put pressure on Congress to extend the tax break. President Obama’s proposal calls for an extension into 2015, but right now, there’s no guarantee.

via Important tax break for some homeowners set to expire 

Think you may not make it in time?  Read this post.