Short Sale Help from Obama’s Administration
May 14, 2009
Here is welcome news from CAR:
Obama Administration Announces Financial Incentives and Uniform Process for Short Sales
The NATIONAL ASSOCIATION OF REALTORS® (NAR) today announced that the Obama Administration has added new incentives and uniform procedures for short sales under its new Foreclosure Alternatives Program (FAP), part of the administration’s Making Home Affordable plan.
Loan servicers may consider short sales or deeds-in-lieu of foreclosure for borrowers who do not qualify to have their loans modified on a permanent basis under the Making Home Affordable Loan Modification Program.
- Borrowers/homeowners qualify under the FAP if they meet minimum eligibility requirements for the Home Affordable Modification program, but don’t qualify for a modification or do not successfully complete the three-month trial period. Before proceeding with a foreclosure, servicers must determine if a short sale is appropriate.
- Incentives include: $1,000 for servicers for successful completion of a short sale or deed-in-lieu of foreclosure; $1,500 for borrowers/homeowners to help with relocation expenses; and up to $1,000 toward the cost of paying junior lien holders to release their liens (one dollar from the government for every $2 paid by the investors to the second lien holders).
- The program will include streamlined and standardized documents, including a Short Sale Agreement and an Offer Acceptance Letter. The goal is to minimize complexity and increase use of the short sale option.
- Servicers will independently establish both property value and minimum acceptable net return, in accordance with investor requirements. The price may be determined based on an appraisal or one or more broker price opinions (BPOs), issued no more than 120 days before the date of the short sale agreement.
- In the Short Sale Agreement, servicers must give borrowers/homeowners at least 90 days to market and sell the property, or up to one year, depending on market conditions. Property must be listed with a licensed real estate professional with experience in the neighborhood. No foreclosure may take place during the marketing period (at least 90 days) specified in the Short Sale Agreement.
- The Short Sale Agreement must specify the reasonable and customary real estate commissions and costs that may be deducted from the sales price. The servicer must agree not to negotiate a lower commission after an offer has been received.
- Servicers may not charge fees to borrowers/homeowners for participating in the FAP.
- The program is in effect through 2012.
- Servicers have the option to require the borrower/homeowner to agree to deed the property to the servicer in exchange for a release from the debt if the property does not sell within the time allowed in the Short Sale Agreement (plus any extensions).
Price Reduced!! Martiswoods Estates in Truckee
May 8, 2009
Bullseye! -
Sellers understand this market is moving and they have hit the target. Now is the time to submit your offer! The snow has melted and you can now appreciate this beautiful acreage (it goes well beyond the fencing). Comfortable family living with 3 spacious bedrooms plus office, family room, formal living & dining rooms and breakfast nook. Separate laundry room and large garage with auto lift for covered 3rd car parking! This home has it all and now at an exceptional price for desirable Martiswoods Estates.
MLS No.: 2900768
Community: Truckee CA
Address: 11605 Sawtooth Court
Posted by: Kappy & Jennifer
Email address: kappy@kappymann.com
Phone: 530 400-0531
Office: Keller Williams Realty
Related Picture:
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Interest Rates & Purchase Power
May 6, 2009
Many of us have been spoiled by recent interest rates and either weren’t old enough or don’t remember when double digit rates hung around for several years. See Mortgage Rate History Graph for an interesting view of how rates have changed over the years dating back to 1973. You will notice that 5% interest rates were no where to be found until 2003 and later. How long do you think this can last?
That leads to the question; How do changes in interest rates affect your purchasing power? Well let’s take a look; The summary below shows how just a ¼% rate difference can change your payment and overall loan amount.
Loan Amount $300,000 $300,000 Difference
Interest Rate 5% 5.25% 0.25%
Monthly Payment $1,610.46 $1,656.61 $46.15
Total Paid Over Life of Loan $579,765.60 $596,379.60 $16,614
Loan Amount $500,000 $500,000 Difference
Interest Rate 5.25% 5.50 % 0.25%
Monthly Payment $2,761.02 $2,838.95 $77.93
Total Paid Over Life of Loan $993,967.60 $1,022,022.00 $28,054.80
Economic Indicators and Interest Rates
May 4, 2009
I got this information from a local lender on his weekly update. Seems that the powers that be in Washington are giving signals that the “recession” is waning. Here it is, compliments of:
Teresa O’Dette and Ephraim Schwartz
PO Box 7558
Tahoe City, CA 96145
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Forcast for the week: |
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The big news to look for this week will be April’s Jobs Report, coming out on Friday at 8:30am ET. The anticipation prior to and results of this report will have Stocks teetering along the aforementioned pivotal level of resistance. The direction of Stocks will no doubt influence Bond prices in the opposite direction. March’s Jobs Report had a mix of good and bad news, as the economy lost 663,000 jobs, meaning 5.1 Million jobs have been lost since the recession began in December of 2007. However, for the first time in a very long while, there were no downward revisions to a prior month’s reading, as February’s number came back with no change. It will be important to see if April’s numbers or any revisions to March show if there is indeed some level of stabilization at hand for the labor market. Remember that the Unemployment Rate tends to be a lagging indicator, but the number of jobs created gives us a current view of the markets. Still on the jobs theme, Thursday’s Initial Jobless Claims number – although volatile – gives us a glimpse of what we can anticipate. |
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The Week’s Economic Indicator Calendar |
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Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise. Economic Calendar for the Week of May 04 – May 08
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Back Home from Baja, MX
May 3, 2009
I just returned from a 12 day girls’ trip to Mexico. Annually 10-12 girls meet in San Felipe, Baja CA MX to just generally relax and do nothing for 10 days. The trip down takes a day and a half, don’t want to drive in Mexico in the dark. This year we picked up a couple of Canadians from Calgary at the Sacramento airport and made it all the way to El Centro by 9:30 pm.
The whole trip was fast and furious, the weather was great, went fishing, rented a condo on the beach etc., etc. If you ever need a place to go be sure to check out Casey’s Place right on the Mar y Sol right next to the El Cortez Hotel. It is such a good deal. Spacious and clean, with everything you need to take care of yourselves for the duration. The price was $1468.00 for 10 nights — not bad. 6 of us were very comfortable there. There was even a masseuse right next door who did a great job for $35 per hour. I am not really sure where the time goes when I am down there but there is never enough. The first few days languish and I think I have all the time in the world. Along about the 4th, the clock seems to speed up and we are on a downhill run.
I wanted to set the record straight on the general conditions in Mexico. Despite the press’ warnings about traveling in Mexico, we saw no sign of trouble or encountered anything that we thought looked dangerous along the road. The people were more than happy to see us and did not give us any cause for concern. Furthermore, the people down there are in just as much trouble economically as we are — the difference is that they know how to live with less — something we have a long way to go to learn.
Evidence of the souring economy is everywhere in San Felipe. This place was touted as recently as 3 years ago as the retirement mecca for Americans. Well, the development there is looking a lot like the development in Arizona, Las Vegas or Reno. Lots of stuff built (or in a lot of cases, 1/2 built) with no one living in them. Yes they built them but no one came. . . . . Walking downtown in San Felipe we saw many shops and restaurants empty and the ones that were open had few tourists inside. Prices are good right now. George’s Hotel, new and modern and right across the street from the Sea of Cortez, offered a “special” of $45 per night for 2 people. The Mexicans are responding to the state of the economy and getting the idea that they have to offer deals to get people in their establishments.
