With the new HARP 2.0 many borrowers are uncertain about government loans and how to determine if they have a government backed loan which are Fannie Mae or Freddie Mac. If your mortgage is owned by Fannie Mae or Freddie Mac, you may be eligible for a Home Affordable Refinance to take advantage of lower interest rates. Your mortgage company can tell you who owns your loan. But the Make Home Affordable site has a resource page to check on government loans.
Don’t race to your lender to request HARP refinancing, chances are they are up to their eyeballs with loan modifications, short sales and foreclosures. Your best bet is to seek a mortgage broker specializing with HARP refinancing. In Florida, Chris Brown with Certified Mortgage Planners, is our go-to guy. Chris knows all the guidelines for the Make Home Affordable Refinance program (HARP).
You want to find the Chris Brown in your area, an expert who can help determine if you qualify for HARP.
HARP is for government loans
Only government loans are eligible for the HARP program. After finding out that your mortgage is owned or guaranteed by Fannie Mae or Freddie Mac, the next step is to see
if you are eligible for a Home Affordable Refinance.
Government loans have specific guidelines for eligibility
There is hear say that lenders plan to come out with their own version of HARP for those who do not have government loans, but it’s yet to be seen.
Posted in HARP Mortgage Relief by .
Dec 11
28
Does Short Sale Cause Confusion?
by Agi Anderson
Many borrowers have a misconceptions about a short sale. A short sale, defined by the Certified Distressed Property Expert’s (CDPE) site explains,
How a short sale works
A short sale can be an excellent solution for homeowners and investors who need to sell, but owe more on their property than what it’s worth. In the past, it was uncommon for a bank or lender to accept a short sale. Today, however, due to overwhelming market changes, banks and lenders have become much more negotiable when it comes to these transactions. Lenders do not want to maintain vacant proprieties and prefer to have borrowers sell short rather than foreclose. Recent changes in corporate policy and the Obama administration have also improved the chances of getting a short sale approved.
But to be technical, here’s a more official definition of a short sale:
A homeowner or investor is ‘short’ when the mortgage amount owed on his/her property is higher than current market value. The deficiency of the sale price and what’s owed on the mortgage is the major issue that causes confusion with a short sale.
A Short sale occurs when negotiations are entered into with the homeowner’s mortgage company (or companies) to accept less than the full balance of the loan at closing. A buyer closes on the property, and the property is then ‘sold short’ of the total value of the mortgage.
For homeowners and investors to qualify for a short sale, they must fall into all of the following circumstances:
Financial Hardship – There is a situation causing you to have trouble affording your mortgage. Monthly Income Shortfall – In other words: “You have more month than
money.” A lender will want to see that you cannot afford, or soon will not be able to afford your mortgage.
Insolvency – The lender will want to see that you do not have significant liquid assets that would allow you to pay down your mortgage.
A short sale may seem simple enough, but it is a complicated process that takes the expertise of experienced real estate professionals. As CDPE, I can help you evaluate your circumstances and help you determine if a short sale is your best option. If you prefer to keep your property, modifications can be explored with the Making Affordable HARP and HAFA government programs. The CDPE Network reaches across the nation, my team and I can connect you with a short sale expert in just about every city in the US.
Stop struggling with an overwhelming mortgage, reach out and get help. Start with getting the A1A Mortgage Relief Guide which provides answers to many questions borrowers have about mortgage relief options. My team and I are positive there is an ideal solution for you.
Posted in Mortgage Relief Short Sales by .
A big thank you to Bobbie Coven-Files for providing this feature post on her short sales perspective. I love Bobbie’s passion for helping folks suffering with mortgage distress. This gal is willing to go to battle with the big boys to get the job done!
With the economy doing what it is doing, short sales are increasingly the only way out for many homeowners. Despite efforts by the Government to keep people in their homes by having lenders participate in modifying the mortgage loans, the actual numbers of people successfully obtaining a modification is only 2.5% in MA. However, lenders are usually fairly compliant and agreeable to short sales. Pretty sad statement!
Massachusetts was spared slightly in the economic meltdown. The state is not even in the top 10 of hardest hit states, not that I expect that to be any consolation to those that have been negatively affected by the distress mess. Lenders still need to ramp up their efforts to assist struggling property owners. Yes, I will admit, the lenders have made great strides over the past couple of years, but there is still mileage left to go.
Short sales, for many people, is the last step prior to foreclosure
Short sales, which are far more advantageous to lenders….can still be quite challenging, more so if HAFA is a factor. In recent months lenders have really started fine tooth combing the files. Not that I expect a lender to just close their eyes to things, or let a homeowner who CAN afford the mortgage payments to walk away scot free, but some situations are so blatantly obvious and the hardship is glaringly genuine. When someone holds up their hand and says “Help ME!” lenders need to listen!!! I find that for the vast majority of people it is very difficult and pride jostling to let ANYONE know that they are sinking and need a life raft. When someone does finally reach the point that they really feel there are no other options, I believe it’s my obligation as a Realtor to try and assist with short sales to be as painless as possible.
The Top 5 lenders, you know “the biggies” have really ramped up their efforts to streamline the short sales process and get the homeowners out without liability, especially using HAFA. But the smaller ones are still an incredible challenge. The smaller lenders proclaim to be a proud participant in the HARP, HAMP and HAFA make affordable programs, but really only participate when it “works for them.” Being self serving is not the essence of these programs and proves to be beneficial to no one. Not for profit lenders such as MassHousing, are scouring the files and are making very bold statements and recommendations to homeowners prior to issuing ANY short sales approval. I have one client who is in her late 60’s, this client had to take early retirement due to medical issues, well MassHousing (without even reading the hardship letter that details the medical issues) stated that the homeowner “needs to go back to work, she took retirement knowing that if would not sufficiently cover all her expenses and now wants us to release her from her mortgage. She can get herself back to work!” Repugnant words and repugnant behavior!!!!!
New England Short sales stem from property owners struggling with high heating costs
In the New England region we are now facing winter coming on, granted it is coming in as a “lamb” BUT it is coming. We are being told that heating costs are going to skyrocket with this winter to be the highest on record. The average family in MA spends $3,300 for heat during the winter, this year that average cost is expected to near $4,000!!! This is EXACTLY the situation that leads struggling homeowners into the inability to make their mortgage payment and become victims of short sales. Heat and hot water are mandatory needs, filling the oil tank right now is $900, for most homes in the heart of the winter that lasts about 6 weeks. Some people only get 4 weeks from that fill up. So when your budget is stretched to its ends due to job loss where does that $4,000 oil money come from?????
Short sales require property owner cooperation
What I find the most shocking with the whole short sales process is the homeowners themselves. I understand that being in a situation requiring a short sale is emotionally devastating, I also understand that it isn’t really what is wanted, so I am not unsympathetic to the issues. Some homeowners seriously are their own worst enemies. Every action they take seems to undermine the entire short sale process, not listening to advice directly given which causes a short sales to be declined. It absolutely stumps me that a homeowner facing a foreclosure sale date cancels showings, makes it impossible for buyers to view their home and does not turn in required paperwork in a timely manner despite repeated requests. They attempt to be in control so much that they decide which of the required paperwork that they want to turn in, do not want to close or move out on the closing date indicated in the short sale approval letter etc…….To close a successful short sale, owners need to cooperate and make their home available for showings. It is equally important to provide all of the required paperwork in a timely manner. The process can be repetitive and tedious, but in order to close a successful short sale all of the the steps must be adhered to and the Realtor needs full cooperation.
Bobbie Files, Realtor, C.D.P.E.
http://ShortSales.BerkleyMass.com
bobbiefiles@KW.com 508-521-9480 Direct
Thank you Bobbie for taking the time to share your thoughts, concerns and valuable advice about short sales!
Posted in Blog by .
Dec 11
14
Renting … After the Short Sale
Posted in Debt Recovery Loan Modifications Refinancing by .
by Agi Anderson, FL RE Broker, Certified Distressed Property Expert
It was the Palm Beach Post, where I saw Bank of America extended the Florida-only incentive program that offers property owners “up to” $20,000 for a short sale, rather than going through a lengthy foreclosure. These short sale cash incentive programs include investors as well as homeowners. Along with Bank of America, Chase, Citi Bank, many other lenders are also offering similar programs. So why are lenders offering cash to close in a short sale? Simple, lenders don’t want anymore empty houses. The $50 per day carrying costs to maintain vacant properties is far more costly then offering property owners cash to sell in a short sale.
Borrowers who have exhausted attempts for HARP or HAMP, may qualify for HAFA in addition to the lender cash incentive for a short sale. Wondering how all this works and how you qualify? Get connected with a Certified Distressed Property Expert (CDPE) in your area. Those of us who have this designation are trained real estate professionals who know and understand how all of the mortgage relief programs work.
Keep up homeowners association fees for a short sale
If you’re thinking. “I’ll just sell my property myself,” no can do. Lenders will only work with Realtors to conduct a short sale, but the good news, the lender will pay the real estate commission for a short sale. They will also pay delinquent taxes, what they have been refusing to pay is homeowner association fees (HOA). What ever you do, if you have association fees keep up the payments, even if you are unable to pay your mortgage payment.
If you are struggling with an upside down mortgage and not sure what options you have, I suggest you get the A1A Mortgage Relief Guide. This comprehensive guide is chock full of information to help you understand options and alternations you have to eliminate mortgage misery. Perhaps a short sale with a lender intensive will be the best option, you won’t known unless you investigate your options, chances are, they are better than you think.
Complete request for short sale assistance:
Posted in HAFA Mortgage Relief by .
Nov 11
16
Do you qualify for HAFA?
Home Affordable Foreclosure Alternatives (HAFA) Program
If your mortgage payment is unaffordable and you are interested in transitioning to more affordable housing, you may be eligible for a short sale or deed-in-lieu of foreclosure through HAFA SM. The benefit of a HAFA short sale is that you are no longer responsible for the difference between what you owe on your mortgage and the amount that your home sells for. You will also receive $3,000 in relocation assistance upon successful closing of your short sale or deed-in-lieu of foreclosure. Major lenders are also offering financial incentives for Florida borrowers to pursue a shortsale, they DO NOT want to carry any more vacant properties. In addition to HAFA funds, borrowers who are eligible may receive an additional $5000-20,000 at closing.
HAFA Eligibility*
You may be eligible to apply for HAFA if you meet all of the following:
- You live in the home or have lived there in the last 12 months.
- You are behind with your mortgage payments
- You have a documented financial hardship.
- You have not purchased a new house within the last 12 months.
- Your first mortgage is less than $729,750.
- You obtained your mortgage on or before January 1, 2009.
- You must not have been convicted within the last 10 years of felony larceny, theft, fraud or forgery, money laundering or tax evasion, in connection with a mortgage or real estate transaction.
*Eligibility criteria are for guidance only. Contact us to see if you qualify for HAFA.
Program Availability
HAFA SM is available for mortgages that are owned or guaranteed by Fannie Mae and Freddie Mac or serviced by over 100 HAMP SM participating servicers.
Posted in HAFA by .
If you are struggling with an overwhelming mortgage payment and you apply for assistance, it’s without question you will be required to provide a hardship letter. There is a lot of misinformation out there about HARP (refinancing), HAMP (loan modification) and HAFA (short sale) all government programs created to provide mortgage relief.
The Making Home Affordable © (MHA) Program is a critical part of the Obama Administration’s broad strategy to help homeowners avoid foreclosure, stabilize the country’s housing market, and improve the nation’s economy.
Property owners can lower their monthly mortgage payments and get into more stable loans at today’s low rates. And for those homeowners for whom homeownership is no longer affordable or desirable, the program can provide a way out which avoids foreclosure. Additionally, in an effort to be responsive to the needs of today’s homeowners, there are also options for unemployed homeowners and homeowners who owe more than their homes are worth.
The confusion is knowing what program is best for your personal situation. When you work with a trained Certified Distressed Property Expert, aka CDPE, they can help you determine which program is best and evaluate what the qualifying factors are for each program. If it’s determined that a short sale is the best option, your CDPE will help you write your hardship letter, compile all the required documents and notify your lender that you’re selling short.
Hardship letter explains why your mortgage has become difficult to pay
A well written hardship letter includes a time line and a clear explanation of what has changed with your circumstances. Lenders receive thousands of packages per day, a hardship letter that makes it easy to understand what transpired helps expedite the process of loan modifications as well as a short sale.
Hardship letter should be one page based on facts
The graphic gives examples of acceptable hardships by lenders across the USA. These hardship examples apply to loan modifications, short sales and Deed in Lieu of foreclosure. If you have fallen behind with your mortgage payments, your hardship letter will provide the explanation of what caused the problem.
Posted in HARP Mortgage Relief by .
Agi Anderson, CDPE, compiled changes made to Make Affordable HARP refinancing program, October 2011 ~ to see if you qualify, just enter your name and email to request HARP guidelines. (make sure to check spam for email confirmation)
