Realty Jen's Rendition

GOOD NEWS FOR HOME OWNERS IN TROUBLE WITH THEIR LOANS: Treasury Department Announces New Short Sales Guidelines

 

National Association of REALTORS® Government Affairs Division 500 New Jersey Avenue, NW, Washington DC, 20001

Treasury Department Announces Home Affordable Foreclosure Alternatives Program On November 30, 2009, the Treasury Department released guidelines and forms for its new Home Affordable Foreclosure Alternatives Program (HAFA). HAFA is part of the Home Affordable Modification Program (HAMP). HAFA provides incentives in connection with a short sale or a deed-in-lieu of foreclosure (DIL) used to avoid foreclosure on a loan eligible for modification under the HAMP program. HAFA applies to loans not owned or guaranteed by Fannie Mae or Freddie Mac, which will issue their own versions of HAFA in coming weeks. HAFA is a complex program, with 43 pages of guidelines and forms, designed to simplify and streamline use of short sales and deeds-in-lieu of foreclosure.

HAFA:

Complements HAMP by providing a viable alternative for borrowers (the current homeowners) who are HAMP eligible but nevertheless unable to keep their home.

Uses borrower financial and hardship information already collected in connection with consideration of a loan modification.

Allows borrowers to receive pre-approved short sales terms before listing the property (including the minimum acceptable net proceeds).

Prohibits the servicers from requiring a reduction in the real estate commission agreed upon in the listing agreement (up to 6 percent).

Requires borrowers to be fully released from future liability for the first mortgage debt (no cash contribution, promissory note, or deficiency judgment is allowed).

Uses standard processes, documents, and timeframes/deadlines.

Provides financial incentives: $1,500 for borrower relocation assistance; $1,000 for servicers to cover administrative and processing costs; and up to $1,000 for investors for allowing a total of up to $3,000 in short sale proceeds to be distributed to subordinate lien holders (on a

one-for-three matching basis).

The program does not take effect until April 5, 2010, but servicers may implement it before then if they meet certain requirements.

The program sunsets on December 31, 2012.

Press Release, HAMP Update—New Program Offers Borrowers Foreclosure Alternatives https://www.hmpadmin.com/portal/docs/news/hampupdate113009.pdf

Tax Credit Extension & Expansion – Hot Points

This month the Senate extended the 1st Time Home Buyer Tax Credit that began January 1st of 2009.  Initially it was set to end on November 30, 2009.  However, President Obama signed the extension on November 6th.  This tax credit has also been expanded to “Move Up Buyers” who currently own a home and are interested in moving up in home price.  It’s a great incentive considering interest rates are still in the 5% range on most home loans. 

$8,000 First-time Home Buyer Tax Credit at a Glance

• The $8,000 tax credit is for first-time home buyers only. For the tax credit program, the IRS defines a first-time home buyer as someone who has not owned a principal residence during the three-year period prior to the purchase.
• The tax credit does not have to be repaid unless the home is sold or ceases to be used as the buyer’s principal residence within three years after the initial purchase.
• The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.
• The tax credit applies only to homes priced at $800,000 or less.
• The tax credit now applies to sales occurring on or after January 1, 2009 and on or before April 30, 2010. However, in cases where a binding sales contract is signed by April 30, 2010, a home purchase completed by June 30, 2010 will qualify.
• For homes purchased on or after January 1, 2009 and on or before November 6, 2009, the income limits are $75,000 for single taxpayers and $150,000 for married couples filing jointly.
• For homes purchased after November 6, 2009 and on or before April 30, 2010, single taxpayers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full tax credit.

The $6,500 Move-Up / Repeat Home Buyer Tax Credit at a Glance

• To be eligible to claim the tax credit, buyers must have owned and lived in their previous home for five consecutive years out of the last eight years.
• The tax credit does not have to be repaid unless the home is sold or ceases to be used as the buyer’s principal residence within three years after the initial purchase.
• The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $6,500.
• The tax credit applies only to homes priced at $800,000 or less.
• The credit is available for homes purchased after November 6, 2009 and on or before April 30, 2010. However, in cases where a binding sales contract is signed by April 30, 2010, the home purchase qualifies provided it is completed by June 30, 2010.
• Single taxpayers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full tax credit.

There’s a lot of information to consider when making a move, please feel free to call or email me if you have questions regarding the new changes to the tax credit. 

I’m here to help!

Oklahoma City…Progressive Promise shown with Maps 3 to the Voters December 8th!

 

 Watch below for the full press conference with News 9. 

 

 

Oklahoma City Metro Housing Statistics - August 2009

 

Oklahoma City is doing well!  We’ve heard it again and again…”Oklahoma City is Recession Proof”.  Well the proof is in the numbers, while we have had lower numbers in 2009 compared to 2008 it’s to be expected.  This year so far in numbers has proven to be nonetheless consistent where Real Estate is concerned.  I’ve been getting a lot of questions from naysayers on what will happen when the tax credit goes away.  I think most of us agree we hope it is extended because it has been an excellent program and has helped many people purchase a home when they wouldn’t have done so under normal circumstances.  The National Association of Realtors (NAR) is working very diligently with their lobbying efforts to not only extend the tax credit but to even possibly open the credit up to anyone who purchases a home. 

 

 

 

The National Association of Realtors® is calling upon its 1.2 million members to urge Congress to extend the successful homebuyer tax credit into next year.

Since its inception earlier this year, the $8,000 first-time homebuyer tax credit has brought 1.2 million new buyers into the market—350,000 of whom would not have purchased a home without the credit, according to NAR. The credit is due to expire November 30.

“Now is the time for Congress to keep this recovery going by extending the tax credit through 2010 and making it available to more homebuyers. We have all seen how the credit has been a spur to bring homebuyers into the market, and have seen the beginnings of a real recovery in the housing market. Housing has always led this nation out of economic downturns, and can do so again,” said NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage in Dallas-Fort Worth.

Realtors®, the leading advocates for homeownership and housing issues, will be writing to their Senators and Representatives to tell them of the successes with the tax credit thus far and to press them to extend and expand it now.

McMillan added that the market has improved, but it has not yet fully corrected itself. “The credit needs to be available for an additional period of time in order to sustain the progress that’s been made so we can continue to see our markets fully recover. Uncertainty about the future of the credit will dampen consumer demand. The only way we can assure that the progress we've made can continue is to extend the credit and to do that now,” he said.

As the current deadline for the credit looms, potential homebuyers need to complete a contract, satisfy any contingencies, secure financing and go to closing by November 30. In today’s market, NAR estimates that it generally is taking between 45 and 60 days from contract to closing.  My personal averages are 30-45 days from contract to closing.

“That means potential homebuyers who qualify must act now, and so must Congress,” McMillan said.

Only 64 Days until the $8,000 Tax Credit ends, one of the highest incentives to purchase a home our country has ever seen…

 

 

Your vote matters! Mustang Public Schools Bond Issue Vote April 7th!

Voters will head to the polls on April 7 to cast their ballot in the Mustang Public Schools bond election. By using a combination of general obligation and lease revenue bonds, the district will be able to have one bond election that will take care of the needs of the district for the next three to five years. The $58 million bond will be sold in a series stretching over several years, keeping tax levels steady with no increase.

HERE IS YOUR PART! 

Most of us who live in the Mustang School district are typically left out of Mustang’s voting Matter’s because we do not live in the “Voting Square”. 

This time your vote matters!  We can’t leave this up to the “Voting Square”. This bond issue will only get passed if those of us NORTH of 59th Street go out and vote.  Tell your neighbors, tell your friends, tell EVERYONE….April 7th is important for the Mustang School District and the future children of the Mustang School District. 

Mustang High School

Approximately $38 million of the bond funds will transform the aging Mustang High School campus, where the average age of the classroom buildings is more than 40 years old, to a facility that meets the standards of a 6A school. New construction, which includes new academic buildings, a media center, cafeteria and commons area, will greatly increase the school’s capacity. The new construction will also tie the separate academic buildings together, dramatically increasing the ability to secure the campus.

Bonnie Lightfoot, superintendent, said improvements at MHS have taken a back seat for several years while the district worked to keep up with the student population growth at the elementary level.

“For several years, the Mustang Public School District has been forced to address immediate needs at the elementary level before we looked at the work that needed to be done at Mustang High School,” Lightfoot said. “What is necessary at the high school required more funds than we were capable of through general obligation bonds. A combination of lease revenue and general obligation bonds is allowing us to take care of the needs at Mustang High School in a timely manner instead of accomplishing it piecemeal over many years.”

The proposed plans call for a two-story academic building to be constructed in front of the Central Building. The more than 79,000 square foot facility would house 28 classrooms and administration offices. It would give MHS a new and visible main entrance. A new and enlarged media center and cafeteria would open onto a new commons area in front of the MHS auditorium. For the first time, Mustang High School would have a visible, secure main entrance, and the classrooms would be under one roof.

A new ninth grade center is also planned. The South Building on the MHS campus would be razed to make room for the new multi-story classroom facility. The ninth grade center would include more than 35 classrooms and move the freshmen back to the high school campus. Administrators made the decision to relocate the freshman after a quality time analysis showed how much instructional time is lost transporting students hourly to the high school campus for classes not available at Mustang Mid-High…continued here

Mustang North Middle School and Mustang Creek Elementary

The bond also includes funds for classroom additions at Mustang Creek Elementary and Mustang North Middle School. Mustang Creek Elementary is nearing capacity and has no extra classrooms. Should the bond issue pass, the additional classrooms at Mustang Creek Elementary will bring the district one step closer to being able to offer all-day kindergarten.

Bonnie Lightfoot, superintendent, said the district put a task force in place three years ago to coordinate the creation of an all-day kindergarten program.

“One of the main hurdles we have faced is finding the space to offer the program. Thanks to the voters, we were able to open Mustang Centennial Elementary in 2007. That made a dramatic difference in the classroom space at the elementary level. Mustang Creek is the only school where classroom space for the program is not available. We will only offer the program when we can offer it at every school and give each child the same opportunity.”

The bond would also make it possible to enlarge the cafeteria at Mustang North Middle School. With more than 900 students in the building, six lunch periods are necessary to serve the students.

For more Questions & Answers concerning the Bond Issue visit http://www.mustangps.org/Q&A.html

If you're not registered to vote or need to change your address, you have until this Friday, March 13th to post mark your voter registration form.

Forms can be downloaded at http://www.ok.gov/~elections/voterreg.html or forms are available at every school and at your local tag agency. 

 

YOUR VOTE MATTERS!!  PASS IT ON!

Home Buyer Tax Credit at a Glance

Here it is…the Tax Credit for 1st Time Buyers.  It is now official!  If you or someone you know are considering your first home purchase it is now time to get off of the fence!  Interest rates are lower than they have been in years and this tax credit is not a deduction it is a dollar for dollar savings in the total income tax paid! 

Spread the word!  It’s called a buyers market for a reason!  Real Estate is a continuous cycle.  Market shifts occur and those who are looking for a good investment will take advantage of these shifts.   

When it comes to Rent vs. Buy the Buyers become the Winners especially with these tax benefits!

FHA Loans – The Lowdown – Fact vs. Myth – Forget what your friends told you!

One result of such woeful housing news is that more and more people are turning to FHA mortgages.  FHA was created when the federal banking system was restructured in 1934.  The National Housing Act was passed and the legislation created the Federal Housing Administration (FHA) with the intent to regulate interest rates and mortgage terms on the loans that it insured.   This was a result of the Great Depression in 1929 when millions of Americans began to lose their homes to foreclosure.  Sound Familiar?  Since 1934, the FHA and HUD have insured over 34 million mortgages. 

When housing prices began to spiral upward in the 1990s, lenders developed mortgage products designed to help people buy homes that had suddenly been priced beyond their reach.  FHA loans fell by the wayside when lenders sold these loans by offering 100% financing vs. the 3% required by FHA.  As home prices continued to rise, the qualifications for loans were loosened and the result is the part of the mess we are in now with foreclosures etc.  But this topic is a whole other blog….so back to FHA Loans. 

Until this point FHA loan growth has been widely assumed, but now we have real numbers from the Office of the Chief Economist at Freddie Mac.

To get some perspective of what’s going on consider these figures from Freddie Mac:

2005 — Loans worth $$3.167 trillion were originated, including VA and FHA mortgages worth $90 billion (2.84 percent of the total marketplace).

2006 — Loans worth $2.858 trillion were originated. The value of VA and FHA loan originations dropped to $80 billion (2.80 percent).

2007 — Loans worth $2.312 trillion were originated while VA and FHA mortgage originations amounted to $120 billion (5.19 percent)

2008 — Loans worth $1.490 trillion were originated — less than half the 2006 total. As to FHA and VA loans, they rose to $291 billion (19.53 percent — almost seven times the 2005 percentage).

The projection for 2009 is even more telling: Freddie Mac estimates that home loans valued at $1.560 trillion will be originated — but that FHA and VA financing will amount to $440 billion (28.21 percent).

What these numbers tell us is that both lenders and borrowers are running from so-called “non-traditional” loan products as quickly as they can and turning instead to mortgage programs which are reasonable and reliable.

If you are considering a home purchase in the near future remember knowledge is power.  Don’t fall for these myths about FHA loans. 

MYTH #1: FHA is only available to First Time Buyers.  NOT TRUE!

• FHA Loans are available to home buyers whether it is their first, second or fifth home purchase.  The truth behind this is you can only have 1 FHA loan at a time.  Also, you are able to have a co-signer on an FHA loan.  Only one borrower needs to be an occupant.

MYTH #2: FHA Loans are more difficult to obtain.  They are a painful process and require more paperwork and special inspections.  NOT TRUE!

• FHA Loans require a different set of paperwork for lenders but not necessarily more paperwork.  Also, there are no “special inspections” required.  HUD requires an appraisal to be made which is common with home loans. 

In conjunction with the appraisal, the appraiser will inspect the home for serious issues that need repair and may require the issues to be remedied.  Some of the things your FHA appraiser will look for are…

1. Missing floor covering, fixtures, outlet covers, and/or exterior siding
2. Rotten wood
3. Defective lead based paint if built prior to 1978, chipping or peeling
4. Dysfunctional windows. (not opening or closing/ broken glass)
5. No bars allowed on windows without a safety latch to open
6. Roof with less than 2 years of economic life
7. Roof with missing or damaged shingles
8. Crawl space must be at least 18 inches
9. No water or debris in the crawl space
10. Attic must have insulation and access if there is an attic
11. HVAC & plumbing & electrical must function properly
12. Electric garage door must have a reverse stop
13. Garage must have drywall on any wall adjacent to living areas
14. Any safety and security issues

MYTH #3: FHA Loans are impossible to qualify for.  NOT TRUE!

• If you are considering a home purchase ask yourself the following questions.

1. Do you have steady employment?
2. Do you have excessive debt: if so, you may not qualify if your debt is too high compared to the amount of money you are bringing in each month.
3. Do you have a down payment: Down payment amounts are much lower for FHA loans, but some money to put down is necessary.  Currently FHA requires a 3.5% down payment.  In Oklahoma you may qualify for down payment assistance with Community Action.  Also, FHA allows the down payment to be a gift from family. 
4. Do you have good credit or better: Those with very low credit scores may not qualify for a home loan right now.  If your credit score is below 580 it may be more difficult to obtain a home loan.

MYTH #4: FHA Loans are only for small loan amounts.  NOT TRUE! 

• In Oklahoma the FHA Loan limit is $271,050.  Currently the average home price is about $145,000 in OKC.  As you can see this limit is well above the average home price.

If you have questions on FHA loans please contact me and I will put you in touch with a qualified FHA loan officer.  Only a few Mortgage brokers are actually FHA approved.  Today I spoke with a lender at Canadian State Bank who said they had a new loan program offering FHA rates at 5% while other banks were still offering 5.5%. 

It just goes to show the right Lender along with the right Realtor

can make all the difference in guiding you through your biggest investment!