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Fannie Mae Buyer Incentive – Closing Cost Assistance

Please view the HomePath website here to learn more about the current buyer incentives - http://www.homepath.com/incentive/index.html

HomePath® Buyer Incentive: June 14 – October 31

Fannie Mae is currently offering buyers up to 3.5% in closing cost assistance through October 31, 2011. A $1,200 selling agent bonus is also available to selling agents who close on an owner occupant property and meet all eligibility requirements and terms and conditions. Continue reading “Fannie Mae Buyer Incentive – Closing Cost Assistance”

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3 big banks lose mortgage modification incentives

By Alejandro Lazo, Los Angeles Times

June 10, 2011

The Obama administration has punished three of the nation’s largest banks, judging them unworthy of receiving financial incentives through its signature foreclosure relief program until they improve their practices.Bank of America Corp., JPMorgan Chase & Co. and Wells Fargo & Co. were found to be in need of “substantial improvement” under the $75-billion Home Affordable Modification Program, officials said. It was the first time that the administration had taken any major punitive action against the banks in its program, which has been criticized by consumer advocates and Republicans as ineffective and falling short of its goals. Continue reading “3 big banks lose mortgage modification incentives”
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Fannie Mae and Freddie Mac to Align Guidelines for Servicing Delinquent Mortgages

“Federal Housing Finance Agency Acting Director Edward J. DeMarco hasdirected Fannie Mae and Freddie Mac (the Enterprises) to align their guidelines for servicing delinquent mortgages they own or guarantee. The updated framework will establish uniform servicing requirements as well as monetary incentives for servicers that perform well and penalties for those that do not.”

Click here for full article - FHFA NEWS RELEASE

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Rebates – Up To $4000 for making your home more energy efficient

Ever stepped back and looked at your SDGE bill, wishing that you could do something to lower your monthly bill, or wanted to take steps to make your home more energy efficient? SDG&E has a program that will work with you to do just this. Take advantage of their programs, and receive up to $4,000 in rebates just for making your home more energy efficient! While most of these programs are from SDG&E, I should mention that there are rebates from many of the water suppliers in San Diego as well.

Upgrading an existing home is an ideal way to save energy, money and conserve natural resources. And now, through Energy Upgrade California, SDG&E® customers can receive incentives along the smart energy journey.

Property owners of single-family homes are eligible for incentives of up to $4,000 for installing energy-efficient measures in their homes. Property owners can choose between two paths for participation.

– Energy Upgrade California Website

However, this program is not just for homeowners, renters can take advantage of many of this programs savings as well!

Their two largest rebate programs consist of a package of measures to decrease your energy consumption by 10-40% with measures that includes air sealing, attic insulation, duct sealing, insulation of hot water pipes, thermostatic shower-start devices, carbon monoxide detectors and combustion safety testing.

While I could easily spend the next 10,000 words describing some of their rebate programs, it may be easier to just take a look here for more information about rebate programs here in San Diego County by clicking here.

 

If you have used any of these programs before, please comment below to help out others who are looking into these programs! Please share your experience.


 

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How Do We Love Real Estate Benefits?

Let us count the ways…

By Mike Cotter | Email the author | April 8, 2011

 

Owning real estate has benefits unlike any other investment.  Sure, there is no guarantee that real property will automatically begin to appreciate the minute we close escrow, but no investment has such guarantee. Even so called risk-less U.S. Treasury obligations are subject to market value fluctuations before maturity and are usually subject to risks of inflation. So we invest our money as we choose.

But the advantages of a real estate investment are unique and sizable.

First of all, we all have to live somewhere, and shelter is not cheap.  Investing in a home allows us to live in our investment.  Over a long period of time, this usually results not only in a positive return on our capital, but also is “free rent” while we live there.  That’s huge.

Of course, if we have to borrow money to buy a home, the monthly interest payments on the debt can be substantial.  But we get an incredibly low interest rate compared to other sources of credit. Where else can we borrow money for 30 years at an annual fixed rate of less than 5 percent?

Also, taxpayers can deduct from their income home mortgage interest up to $1 million annually.  This benefit alone often makes the monthly cost of owning a home with a mortgage less expensive than the nondeductible monthly rent of a similar home.

As for annual California property taxes, they can be substantial for new homeowners—at about 1 percent of the market price paid for the property.  But over time,  Proposition 13 allows the tax bill to grow at no more than 2 percent per year.  So, as property values rise and inflation erodes the dollar, the property tax bill becomes a relatively minor consideration.

Owners of historic properties can apply for a Mills Act agreement with their city that can cut their property tax by 60 percent in some cases—if they agree to preserve the properties.  San Clemente has such a program with 65 of the city’s 206 historic properties participating.

Adding frosting to the cake:  If we sell a home and trade down to a less expensive home after reaching age 55, Propositions 60 and 90 often allow us a one-time opportunity to transfer our relatively low existing tax bill to our new home.  That’s huge.

When we sell most investments at a gain, we usually have to pay capital gains tax.  Not so with real estate used as our primary residence.  A federal law passed a few years ago allows up to $250,000 in capital gains tax forgiveness for each property owner. So a married couple can get a $500,000 capital gain on their home without paying any capital gains tax. That’s huge.

But, let’s say our property investment doesn’t turn out very well.  For one reason or another we end up defaulting on the loan we obtained to purchase our home.  Unlike with other investments, lenders generally have no recourse other than repossessing the real estate in collecting the bad debt.  California home lenders usually have to forgive any deficiency they suffer in collecting the original “purchase money” loan.  That’s huge.

Further, while a forgiven loan has always been considered taxable income in the past by the IRS, current law in most cases prevents federal and state taxation of a forgiven home loan, at least through 2012.  That’s really huge.

Disclaimer:  I’m not an attorney.  This is a very general and incomplete review of some of the benefits of owning real estate.  Always consult with your tax attorney and CPA when making decisions with respect to real estate.

For more of the latest market news and statistics on San Clemente real estate, visit my blog atSanClementeRealEstateBlog.com or MCotter.com.

Original article at http://sanclemente.patch.com/articles/how-do-we-love-real-estate-benefits

 

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House votes to kill Obama mortgage plan

By Jennifer Liberto, senior writer
March 29, 2011: 8:21 PM ET

WASHINGTON (CNNMoney) — The House passed a bill Tuesday to kill a signature Obama administration program that helps homeowners stay in their homes but has faced criticism as ineffective.

The House voted 252 to 170 to stop any new funding for the Home Affordable Modification Program (HAMP). Eleven Democrats joined Republicans to defund the program.

The program taps the federal bailout that saved the big banks, providing incentives to mortgage servicers to modify mortgages for borrowers behind on their payments.

“To many struggling Americans seeking permanent mortgage relief, HAMP offered little more than false hope. More homeowners have been kicked out of the program than have received permanent relief,” Rep. Darrell Issa, the California Republican who chairs the House Oversight Committee, said in a statement.

The bill’s path in the Senate is uncertain. President Obama has vowed to veto it.

Already, House Republicans have passed three other smaller programs designed to help families and neighborhoods dealing with foreclosure. What makes the HAMP program different is the widespread criticism it has received, from both Republicans and Democrats, for being ineffective.

“It would put an end to the poster child for failed federal foreclosure programs,” said Rep. Judy Biggert, an Illinois Republican.

On Tuesday, 50 House Democrats wrote Treasury Secretary Tim Geithner a letter, urging him to reform the program, saying “HAMP must change to meet its potential.”

“Yes, the HAMP program has a lot of problems,” said Rep. Barney Frank, a Massachusetts Democrat, on the House floor. “But, the absence of any program leaves homeowners worse off.”

The outgoing special investigator general for the Troubled Asset Relief Program called HAMP a “failure,” in an interview with CNN on Friday. He said it was supposed to help 3 to 4 million underwater homeowners stay in their homes. But so far, it has only managed to help about 500,0000 homeowners.

“It’s really one of the deep failures of TARP,” said Neil Barofsky, the special investigator general. “TARP wasn’t supposed to just help the banks return to profitability, it was supposed to help people stay in their homes.”

Treasury has pointed out, on several occasions, that while the HAMP program could be better, it’s the only federal program spurring mortgage servicers to help homeowners.

“This is a very difficult housing market to fix, and this program, is at least helping fix it,” Timothy Massad, the Treasury acting assistant secretary who is overseeing HAMP, said recently to a Senate Banking panel. “It’s not enough. But it needs to be continued so we can try to ease the pain for millions of American families.”

The GOP proposal would stop Treasury from being able to help 100,0000 new troubled homeowners, according to the Congressional Budget Office. Treasury spends about $13,000 per homeowner on the program, CBO said.

It would also cut federal deficits, saving a minimal amount, $1.3 billion over the next five years.

Massad said in a statement released late Tuesday that the House move will “make it harder to prevent unnecessary foreclosures and for our country to recover from this housing crisis.”

Original article at http://money.cnn.com/2011/03/29/news/economy/republicans_kill_hamp/index.htm

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Banks drag feet on short sales, survey finds

Associated Press
March 7, 2011, 10:09 p.m.

Banks are dragging their feet when considering so-called short sales, an increasingly prevalent type of real estate transaction in which lenders allow homes to be sold for less than what is owed on them, according to a survey of California real estate agents.

Nearly two-thirds of the 2,150 respondents to the California Assn. of Realtors’ survey of member agents said banks took longer than 60 days to respond to short sale offers and that fewer than three out of every five offers ultimately resulted in a sale.

The response times are much longer than those specified in government guidelines for banks who agreed to participate in programs that help troubled borrowers when they accepted a share of the $700-billion Wall Street rescue.

“The survey results show that the short sale system is clearly flawed,” CAR president Beth L. Peerce said. “Increasing the number of successful short sale transactions is one important way we can help California families and move our economy closer to recovery.”

Although the survey only covered agents in California, National Assn. of Realtors spokesman Walter Molony said similar complaints had come from across the country, especially from states with hard-hit housing markets such as Nevada, Florida and Arizona.

“Banks just have not been equipped or willing to make quick decisions on this,” Molony said. “It’s unfair to all parties concerned.”

Short sales have played an increasingly large role in California’s real estate market, with declines in property values leaving many borrowers with crushing payments on mortgages that are greater than their homes’ worth.

The transactions allow troubled borrowers to dodge the hit to their credit scores that would come from a foreclosure, while banks are able to keep distressed properties off their books without going through the costly foreclosure process.

The estimated percentage of resales in the state that were short sales went from about 10% in 2008 to 18% in 2010, according to tracking firm DataQuick Information Systems.

But foreclosures are still much more common, accounting for nearly 38% of all resales in 2010, DataQuick said.

Richard Green, who directs the USC Lusk Center for Real Estate, said the market would benefit from avoiding foreclosures, which can lead to homes languishing on the market, by encouraging more short sales.

“Forcing banks to clear the market through short sales would almost certainly get us through this faster than we’re getting through it,” he said.

Green said he suspected banks were slow to approve short sales because the transactions force them to immediately report the difference between the sale price and what they’re owed as a loss, rather than carrying the loan balance as a purported asset. He said some banks may also fear inadvertently letting property go for less than it’s worth.

Mortgage Bankers Assn. spokesman John T. Mechem did not return a phone message.

CAR had previously written to federal government agencies that oversee short sales to ask them to mandate faster responses by banks and to take other steps to foster more of the transactions.

The association said in the December letter to the Treasury and the Federal Housing Finance Agency, which oversees government-supported lenders Fannie Mae and Freddie Mac, that banks were not living up to the terms of the Home Affordable Foreclosure Alternatives’ short sale program.

Since most lenders have repaid their bailout funds to the government, participation in HAFA is now primarily voluntary, but CAR said the banks should still be bound by the agreement.

The association noted that banks were taking much longer to approve short sales than the time allotted by HAFA: Ten days in cases where the lender has already decided on a selling price; 30 days if the selling price is being proposed by a listing agent.

CAR asked for the government agencies to force banks to complete all short sales following HAFA guidelines and to comply with the program’s time frames. It also recommended increasing monetary incentives to banks for completing short sales.

Treasury spokeswoman Andrea Risotto said that her agency was still working on its response to CAR’s letter, but that some of the requests — such as punishing banks for not meeting HAFA’s time frames — would require legislative action.

A message left with the Federal Housing Finance Agency was not returned.

Original article at http://www.latimes.com/business/la-fi-short-sales-20110307,0,6800709.story

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C.A.R. Short Sale Lender Satisfaction Survey

LOS ANGELES – Fewer than three of five short sales close in California, illustrating the complexity and difficulty of navigating lenders’ and servicers’ short sale procedures, according to a Short Sale Lender Satisfaction Survey conducted by the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.). The survey gauges REALTORS®’ experience in working with short sale transactions – transactions in which the lender or lenders agree to accept less than the mortgage amount owed by the current homeowner.

“It’s disappointing that less than three in five short sales close, despite every effort by the REALTOR®, home seller and potential home buyer,” said C.A.R. President Beth L. Peerce. “Many underwater homeowners who have been hit by the recent economic crisis can no longer afford to stay in their home and just need to sell their home as expeditiously as possible are unable to largely because of the complex and cumbersome short sale process,” she said.

Of the REALTORS® surveyed, 94 percent participated in a short sale transaction during 2010, demonstrating the surplus of short sale listings in today’s real estate environment.

The most frequent problems REALTORS® cited in working with lenders and servicers during the short sale process include unresponsiveness, onerous procedures, and long processing delays.

Nearly three-fourths (70 percent) of REALTORS® said that closing their most recent short sale transaction with a lender or servicer was “difficult” or “extremely difficult,” while only 10 percent said it was “easy” or “extremely easy.”

“The lack of standardization, long approval process, and lack of lender approvals are hampering what should be a 45-day short sale process,” said Peerce. “Instead we’re hearing the typical response time for lenders is at least 60 days, and in many instances, their response time exceeds 6 months.”

More than half (63 percent) of REALTORS® said that lenders took more than 60 days to return a written response of the approval or disapproval of the short sale agreement submitted. Only 4 percent said they received a written response in less than 14 days.

Additionally, 44 percent of REALTORS® said that lenders took more than five business days to return any form of communication to REALTORS®. Only 14 percent said lenders responded “within one business day.”

“The survey results show that the short sale system is clearly flawed and must be standardized and streamlined to reduce the inventory of foreclosures,” said Peerce. “Increasing the number of successful short sale transactions is one important way we can help California families avoid foreclosure and move our economy closer to recovery,” she added.

Further illustrating faulty communication problems, 64 percent of REALTORS® were “not satisfied” or “not at all satisfied” with the timeliness of lenders’ response to their inquiries, while only 22 percent said they were “satisfied” or “extremely satisfied.”

Moreover, nearly three-fourths (74 percent) of REALTORS® were “not satisfied” or “not at all satisfied” with the amount of time it took to hear whether a transaction was approved or disapproved, while 16 percent said they were “satisfied” or “extremely satisfied.”

In overall satisfaction with the lender they worked with, 67 percent of REALTORS® were “not satisfied” or “not at all satisfied,” while 19 percent were “satisfied” or “extremely satisfied.”

C.A.R.’s Short Sale Lender Satisfaction Survey was conducted during the last two weeks of December 2010 to gauge REALTORS®’ experience in working with lenders or servicers of short sales, bank-owned properties (REOs), and foreclosures. The survey was delivered to 20,000 REALTORS®, with 2,150 responding to the survey.

Leading the way…® in California real estate for more than 100 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States, with more than 160,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

Original article at http://www.car.org/newsstand/newsreleases/sslendersurvey/

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How to Negotiate for Furniture When You’re Involved in the Sale of a House

February 27, 2011, 4:46pm

To effectively negotiate furniture into the sales agreement for a house, you should identify in advance any furniture that you are interested in selling or buying, let the realtor know your terms and expectations, don’t be afraid to receive or make a counteroffer, and closely examine the sales contract.

You can expect to do a lot of negotiating and bargaining when buying or selling a house. Common points of discussion between sellers and buyers can include the price of the homes for sale as well as what items are included in the sales agreement such as furniture. Here are several suggestions for negotiating furniture effectively when purchasing or selling a home:

Earmark early on any furniture you might be interested in selling or purchasing

A list of which pieces of furniture that you wish to either leave behind or include in the sale of the house should be made Furniture is included in the contract mostly when the buyer and seller can’t come to a deal. You must have a good preparation to face buyers who come with a topic of including additional items in the package. If you are a buyer, you should make sure to identify any items in the house that you might be interested in when you are allowed to see inside. Adequate attention must be paid on expensive furniture pieces that decorate your home as their replacement would be difficult.

Explain to the realtor what you want and how you plan to go about it

Make a note of which things you want to purchase or sell and give the list of items to your realtor. The realtor will be responsible for presenting the terms and handling the negotiation between the buyer and seller. For buyers, it is important that you let the realtor know what your expectations of the deal are. If you are selling, make sure not to let go of a large amount of furniture quickly. Be sure to let the realtor know your terms, but early in the negotiation it may be wise to hold off on offering high-cost pieces. You can offer your more expensive furniture items only if you see that the potential homebuyer needs some encouragement to pursue the deal.

Try not to be intimidated by accepting or proposing a counteroffer

If you are a seller, you should be prepared for your initial offer to be rejected and for the possibility that you will receive a counter proposal. If you are presented with a counteroffer, look over it to see if the terms and conditions are consistent with your needs and then make a decision about whether you want to add furniture to the agreement. For purchasers, don’t be scared to speak up with an alternative if you notice the seller’s proposal still has negotiation room.

Closely examine the sales contract

Sellers should already have written a contract with clearly defined terms. Take care to check carefully to decide if it is suitable and not going to place you at a disadvantage. In the case of buyers, make sure that you have examined the contract to determine if the seller included any furniture pieces in the deal. In case you’re worried about missing any minor details, feel free to have your lawyer take a look at the documents.

Buyers and sellers need not be nervous about negotiating all the possible issues as the purchase and sale of a property is a major event for both.

Original article at http://www.mb.com.ph/articles/306583/how-negotiate-furniture-when-you-re-involved-sale-a-house