Buying your first home in 5 steps
RICHMOND, Va. – April 26, 2010 – As a Realtor, Lacy Williams gives presentations to first-time home buyers about what to expect when buying a home.
She often finds she must start at the beginning, helping novice buyers decide whether it makes more financial sense to rent or buy. Then she gets down to the nuts and bolts: how to get a loan, pick a Realtor and look for a home.
"I tell people there are no stupid questions. Ask anything you don't understand," says Williams, with Joyner Fine Properties in Richmond, Va. "One of the biggest mistakes they make is they go to an open house and wind up buying from the listing agent. The listing agent represents the seller. They need a Realtor who represents them."
With the spring buying season in full swing, first-time home buyers are driving much of the current sales activity – lured in part by low prices, interest rates around 5 percent, and a federal tax credit of up to $8,000 for those who can sign a contract by April 30 and close by June 30.
But it can be a confusing process, even for veteran buyers. Here are five tasks that Realtors, brokers and other housing experts say first-time home buyers should know how to do before getting into the market:
Get financials in order. Buyers should check their credit score, taxes, 401(k)s and other aspects of their financial situation to determine the maximum they're comfortable affording for their monthly mortgage, utilities, maintenance, taxes and insurance.
"If your credit score is a mess, clean it up before applying for a mortgage," says Ed Mermelstein, a New York-based real estate lawyer and developer. "A bad credit score may not just affect your rates, but may prevent you from getting a mortgage."
Buyers should also get preapproved by a broker or lender – that means they get an agreement by a bank to lend the buyer up to a specific amount for a home, and it tells sellers that financing is already lined up.
That's different than a letter of prequalification, which states that a buyer's financial information and credit look good. A prequalification does not guarantee a loan. Some websites, such as myhome.bankofamerica.com and trulia.com/guides/home_buying, aim to help buyers getting into the market.
Find a Realtor and start looking. To find a good Realtor, talk to friends, neighbors and co-workers. Referrals can be the best way to select someone. Make sure your choice has experience with the neighborhood and is a good negotiator.
The wrong agent can lead to frustrations. Marc Kruskol, 52, closed on his new home in January after going through about five Realtors.
"I don't have patience for Realtors who are lazy or don't do their job," says Kruskol, who bought a five-bedroom home in Palmdale, Calif., with a pool and three-car garage for $200,000. He got a 30-year, fixed-rate mortgage with a 4.99 percent interest rate.
Diann Patton, a consumer real estate specialist with Coldwell Banker Real Estate, suggests interviewing Realtors for the job. "This person is going to become your best friend for the next 30, 60, 120 days," she says.
Before buyers start looking, Patton suggests they make a pro-and-con list of things they must have in a house and prioritize what's most important. Think about lifestyle needs such as location and proximity to shopping and churches.
"Try not to treat your home like you're living in the stock market," she says. "It's a lifestyle, not about flipping. Don't try to time the market. We never know if it's going to go up or down."
Investigate the reputations of builders, condos. Buyers who are purchasing a new home should check out the reputation of the builder by getting information from the Better Business Bureau.
And, when buying a condo, first-time buyers should check out the financial health of the condo or homeowner association. In the past, this was rarely a problem because, for the most part, owners paid their monthly maintenance assessments and the associations were well-funded, says Robert White, managing director of KW Property Management and Consulting, a property-management firm in Miami.
But now some have cut services, and some are going without insurance, and dues-paying owners are subsidizing those who aren't paying.
"When they buy into a homeowner or condo association, the association may be having financial difficulties," White says. "A first-time owner could buy into the association, and the association could budget more expenses to the units that are paying, subsidizing the units that aren't paying. Ask the management company for a copy of the financial statements."
Make an offer and apply for a mortgage. There are myriad tips on making that final offer. While every local market is different, most economists say buyers are generally in the driver's seat today. Fifty-three percent of homeowners believe a seller's market is still two or more years away, according to a survey of 2,003 adults between March 30 and April 2 by American Express.
This market is very local. Homes in Chicago are getting multiple offers and going for more than 10 percent over the asking price, for example, while those in Fort Lauderdale are selling for 20 percent less than list price, according to ZipRealty.
Have enough cash for a down payment, which can be a minimum of 10 percent, and extra funds for closing costs, including appraisal costs and move-in deposit. Make sure any new additions or construction to an existing home have been properly filed with the city and approved. Be aware that appraisers will likely under-appraise than over-appraise, Mermelstein says.
"Definitely do an inspection. A lot of homes are sold 'as is' now, but you can get a credit (from the seller) if there is something big," says Cindy Royall Libonati, in Woodland Hills, Calif., a Realtor with Ewing & Associates Sotheby's International Realty.
To help determine an offering price, check closing costs of comparable homes on websites such as Propertyshark.com and Zillow.com.
Prepare for closing. At closing, first-time buyers get the keys to their new home. But there's a lot to prepare first. They'll have to get certified funds to cover closing costs and down payments (a settlement statement provided a day or two before closing will tell the buyer how much is needed). Homeowners insurance policies must be secured prior to closing as well. A closing cost estimate is provided after the application for the home loan spelling out what funds will be needed at closing.
Many Realtors suggest buyers have a financing contingency that will let them out of their contract without penalty if they don't get their loan. Buyers should also have a contingency that the home appraises for at least the selling price.
"First-time homeowners don't know you have to have a cashier's check, not a check," says Pat Lashinsky, CEO of ZipRealty, adding that they can be surprised by all the costs. "They can be like 'Whoa, what's all this' if they're not expecting it."
© Copyright 2010 USA TODAY
Monday, April 26, 2010
Friday, April 23, 2010
Mortgage rates unchanged from last week
Mortgage Rate Trend Index
Rates aren’t going down say all but 12% of the mortgage industry experts polled by Bankrate.com this week. The rest split fairly evenly: 47% predict an increase over the short term, while 41% see no change.
McLEAN, Va. – April 23, 2010 – Rates on 30-year mortgages didn't budge from last week and remained above 5 percent, Freddie Mac said Thursday.
The average rate for 30-year fixed-rate mortgages was 5.07 this week, the same as the previous week. A year ago, 30-year fixed rate mortgages averaged 4.80 percent, Freddie Mac said.
Rates had dropped to a record low of 4.71 percent in December, pushed down by a Federal Reserve campaign to reduce borrowing costs for consumers. The program ended in March, but the Fed left the door open to reviving the program if the economy weakens.
Low rates make mortgages less expensive for homebuyers.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day, often tracking the interest rate paid on long-term Treasury bonds.
This week, the average rate on a 15-year fixed-rate mortgage was 4.39 percent, down from 4.40 percent last week.
Rates on five-year, adjustable-rate mortgages averaged 4.03 percent, down from 4.08 percent a week earlier. Rates on one-year, adjustable-rate mortgages rose to 4.22 percent from 4.13 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.
The nationwide fee for loans in Freddie Mac's survey averaged 0.7 of a point for 30-year loans, 0.6 of a point for 15-year and 5-year loans, and 0.5 of a point for 1-year loans.
Copyright © 2010 The Associated Press
Mortgage Rate Trend Index
Rates aren’t going down say all but 12% of the mortgage industry experts polled by Bankrate.com this week. The rest split fairly evenly: 47% predict an increase over the short term, while 41% see no change.
McLEAN, Va. – April 23, 2010 – Rates on 30-year mortgages didn't budge from last week and remained above 5 percent, Freddie Mac said Thursday.
The average rate for 30-year fixed-rate mortgages was 5.07 this week, the same as the previous week. A year ago, 30-year fixed rate mortgages averaged 4.80 percent, Freddie Mac said.
Rates had dropped to a record low of 4.71 percent in December, pushed down by a Federal Reserve campaign to reduce borrowing costs for consumers. The program ended in March, but the Fed left the door open to reviving the program if the economy weakens.
Low rates make mortgages less expensive for homebuyers.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day, often tracking the interest rate paid on long-term Treasury bonds.
This week, the average rate on a 15-year fixed-rate mortgage was 4.39 percent, down from 4.40 percent last week.
Rates on five-year, adjustable-rate mortgages averaged 4.03 percent, down from 4.08 percent a week earlier. Rates on one-year, adjustable-rate mortgages rose to 4.22 percent from 4.13 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.
The nationwide fee for loans in Freddie Mac's survey averaged 0.7 of a point for 30-year loans, 0.6 of a point for 15-year and 5-year loans, and 0.5 of a point for 1-year loans.
Copyright © 2010 The Associated Press
Mortgage rates unchanged from last week
Mortgage Rate Trend Index
Rates aren’t going down say all but 12% of the mortgage industry experts polled by Bankrate.com this week. The rest split fairly evenly: 47% predict an increase over the short term, while 41% see no change.
McLEAN, Va. – April 23, 2010 – Rates on 30-year mortgages didn't budge from last week and remained above 5 percent, Freddie Mac said Thursday.
The average rate for 30-year fixed-rate mortgages was 5.07 this week, the same as the previous week. A year ago, 30-year fixed rate mortgages averaged 4.80 percent, Freddie Mac said.
Rates had dropped to a record low of 4.71 percent in December, pushed down by a Federal Reserve campaign to reduce borrowing costs for consumers. The program ended in March, but the Fed left the door open to reviving the program if the economy weakens.
Low rates make mortgages less expensive for homebuyers.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day, often tracking the interest rate paid on long-term Treasury bonds.
This week, the average rate on a 15-year fixed-rate mortgage was 4.39 percent, down from 4.40 percent last week.
Rates on five-year, adjustable-rate mortgages averaged 4.03 percent, down from 4.08 percent a week earlier. Rates on one-year, adjustable-rate mortgages rose to 4.22 percent from 4.13 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.
The nationwide fee for loans in Freddie Mac's survey averaged 0.7 of a point for 30-year loans, 0.6 of a point for 15-year and 5-year loans, and 0.5 of a point for 1-year loans.
Copyright © 2010 The Associated Press
Mortgage Rate Trend Index
Rates aren’t going down say all but 12% of the mortgage industry experts polled by Bankrate.com this week. The rest split fairly evenly: 47% predict an increase over the short term, while 41% see no change.
McLEAN, Va. – April 23, 2010 – Rates on 30-year mortgages didn't budge from last week and remained above 5 percent, Freddie Mac said Thursday.
The average rate for 30-year fixed-rate mortgages was 5.07 this week, the same as the previous week. A year ago, 30-year fixed rate mortgages averaged 4.80 percent, Freddie Mac said.
Rates had dropped to a record low of 4.71 percent in December, pushed down by a Federal Reserve campaign to reduce borrowing costs for consumers. The program ended in March, but the Fed left the door open to reviving the program if the economy weakens.
Low rates make mortgages less expensive for homebuyers.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day, often tracking the interest rate paid on long-term Treasury bonds.
This week, the average rate on a 15-year fixed-rate mortgage was 4.39 percent, down from 4.40 percent last week.
Rates on five-year, adjustable-rate mortgages averaged 4.03 percent, down from 4.08 percent a week earlier. Rates on one-year, adjustable-rate mortgages rose to 4.22 percent from 4.13 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.
The nationwide fee for loans in Freddie Mac's survey averaged 0.7 of a point for 30-year loans, 0.6 of a point for 15-year and 5-year loans, and 0.5 of a point for 1-year loans.
Copyright © 2010 The Associated Press
Thursday, April 22, 2010
Florida’s existing home, condo sales rise in March 2010
Related story:
NAR: Existing-home sales rise on buyer tax credit, favorable market conditions.
ORLANDO, Fla. – April 22, 2010 – Florida’s existing home sales rose in March, which means that sales activity has increased in the year-to-year comparison for 19 months, according to the latest housing data released by Florida Realtors®.
Existing home sales increased 24 percent last month with a total of 16,294 homes sold statewide compared to 13,090 homes sold in March 2009, according to Florida Realtors. Statewide existing home sales last month increased 37 percent over statewide sales activity in February. Also noteworthy: While March’s statewide existing-home median price of $137,000 was down from the same time a year ago, it was 4.3 percent higher than February’s statewide existing-home median price.
Florida Realtors also reported a 63 percent increase in statewide sales of existing condos in March compared to the previous year’s sales figure; statewide existing condo sales last month rose 40.6 percent over the total units sold in February. Though March’s statewide existing-condo median price of $96,900 was down compared to the year-ago figure, it was 5.1 percent higher than February’s statewide existing-condo median price.
Seventeen of Florida’s metropolitan statistical areas (MSAs) reported increased existing home sales in March while all MSAs had higher condo sales. A majority of the state’s MSAs have reported increased sales for 21 consecutive months.
Florida’s median sales price for existing homes last month was $137,000; a year ago, it was $141,300 for a 3 percent decrease. Industry analysts with the National Association of Realtors® (NAR) note that sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes. The median is the midpoint; half the homes sold for more, half for less.
Thenational median sales price for existing single-family homes in February 2010 was $164,300, down 2.1 percent from a year earlier, according to NAR. In California, the statewide median resales price was $279,840 in February; in Massachusetts, it was $271,950; in Maryland, it was $237,446; and in New York, it was $225,000.
NAR’s latest outlook anticipates a rise in home sales in late spring, which should help to absorb inventory. Increased pending sales is a positive sign for home prices, which are continuing to stabilize, according to NAR Chief Economist Lawrence Yun.
In Florida’s year-to-year comparison for condos, 7,148 units sold statewide last month compared to 4,387 units in March 2009 for an increase of 63 percent. The statewide existing condo median sales price last month was $96,900; in March 2009 it was $108,500 for an 11 percent decrease. The national median existing condo price was $170,200 in February, according to NAR.
Interest rates for a 30-year fixed-rate mortgage averaged 4.97 percent last month, down from the average rate of 5 percent in March 2009, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
Among the state’s larger markets, the Sarasota-Bradenton MSA reported a total of 1,055 homes sold in March compared to 765 homes a year earlier for a 38 percent increase. The market’s existing home median sales price last month was $163,800; a year earlier it was $150,000 for an increase of 9 percent. A total of 382 condos sold in the MSA in March compared to 226 units sold the same month a year earlier for an increase of 69 percent. The existing condo median price last month was $146,400; a year earlier, it was $129,000 for a gain of 13 percent.
Related: NAR: Existing-home sales rise on buyer tax credit, favorable market conditions
© 2010 Florida Realtors®
Related story:
NAR: Existing-home sales rise on buyer tax credit, favorable market conditions.
ORLANDO, Fla. – April 22, 2010 – Florida’s existing home sales rose in March, which means that sales activity has increased in the year-to-year comparison for 19 months, according to the latest housing data released by Florida Realtors®.
Existing home sales increased 24 percent last month with a total of 16,294 homes sold statewide compared to 13,090 homes sold in March 2009, according to Florida Realtors. Statewide existing home sales last month increased 37 percent over statewide sales activity in February. Also noteworthy: While March’s statewide existing-home median price of $137,000 was down from the same time a year ago, it was 4.3 percent higher than February’s statewide existing-home median price.
Florida Realtors also reported a 63 percent increase in statewide sales of existing condos in March compared to the previous year’s sales figure; statewide existing condo sales last month rose 40.6 percent over the total units sold in February. Though March’s statewide existing-condo median price of $96,900 was down compared to the year-ago figure, it was 5.1 percent higher than February’s statewide existing-condo median price.
Seventeen of Florida’s metropolitan statistical areas (MSAs) reported increased existing home sales in March while all MSAs had higher condo sales. A majority of the state’s MSAs have reported increased sales for 21 consecutive months.
Florida’s median sales price for existing homes last month was $137,000; a year ago, it was $141,300 for a 3 percent decrease. Industry analysts with the National Association of Realtors® (NAR) note that sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes. The median is the midpoint; half the homes sold for more, half for less.
Thenational median sales price for existing single-family homes in February 2010 was $164,300, down 2.1 percent from a year earlier, according to NAR. In California, the statewide median resales price was $279,840 in February; in Massachusetts, it was $271,950; in Maryland, it was $237,446; and in New York, it was $225,000.
NAR’s latest outlook anticipates a rise in home sales in late spring, which should help to absorb inventory. Increased pending sales is a positive sign for home prices, which are continuing to stabilize, according to NAR Chief Economist Lawrence Yun.
In Florida’s year-to-year comparison for condos, 7,148 units sold statewide last month compared to 4,387 units in March 2009 for an increase of 63 percent. The statewide existing condo median sales price last month was $96,900; in March 2009 it was $108,500 for an 11 percent decrease. The national median existing condo price was $170,200 in February, according to NAR.
Interest rates for a 30-year fixed-rate mortgage averaged 4.97 percent last month, down from the average rate of 5 percent in March 2009, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
Among the state’s larger markets, the Sarasota-Bradenton MSA reported a total of 1,055 homes sold in March compared to 765 homes a year earlier for a 38 percent increase. The market’s existing home median sales price last month was $163,800; a year earlier it was $150,000 for an increase of 9 percent. A total of 382 condos sold in the MSA in March compared to 226 units sold the same month a year earlier for an increase of 69 percent. The existing condo median price last month was $146,400; a year earlier, it was $129,000 for a gain of 13 percent.
Related: NAR: Existing-home sales rise on buyer tax credit, favorable market conditions
© 2010 Florida Realtors®
Monday, April 19, 2010
As deadline looms, 10 million visit tax credit website
WASHINGTON – April 19, 2010 – Interest in the federal homebuyer tax credit surged in the first three months of 2010, with the FederalHousingTaxCredit.com Web site reaching a milestone 10 million visits. Spurred by a sense of urgency as the credit’s April 30 expiration date approached, the site logged about a million visits each month in January, February and March.
The National Association of Home Builders (NAHB) created the site in July 2008 as both an educational and marketing tool.
“NAHB went live with the site the same day the credit was signed into law in 2008, and it quickly became the Internet’s premier source of information about the credit,” says NAHB Chairman Bob Jones
The $8,000 first-time homebuyer credit and the $6,500 repeat buyer credit expire on April 30. However, if buyers sign a sales contract by April 30, the IRS gives them an additional two months – until June 30, 2010 – to close the sale of the home.
Special rules apply to the military, the foreign service and members of the intelligence community. For qualified service members ordered on a period of official extended duty, the dates are extended for one year – through April 30, 2011.
“Homebuyers need to remember, that even though the tax credit is about to expire, conditions remain ideal to buy a home,” said Jones. “There are plenty of existing homes on the market, interest rates are at near-record lows, and prices are very competitive.”
WASHINGTON – April 19, 2010 – Interest in the federal homebuyer tax credit surged in the first three months of 2010, with the FederalHousingTaxCredit.com Web site reaching a milestone 10 million visits. Spurred by a sense of urgency as the credit’s April 30 expiration date approached, the site logged about a million visits each month in January, February and March.
The National Association of Home Builders (NAHB) created the site in July 2008 as both an educational and marketing tool.
“NAHB went live with the site the same day the credit was signed into law in 2008, and it quickly became the Internet’s premier source of information about the credit,” says NAHB Chairman Bob Jones
The $8,000 first-time homebuyer credit and the $6,500 repeat buyer credit expire on April 30. However, if buyers sign a sales contract by April 30, the IRS gives them an additional two months – until June 30, 2010 – to close the sale of the home.
Special rules apply to the military, the foreign service and members of the intelligence community. For qualified service members ordered on a period of official extended duty, the dates are extended for one year – through April 30, 2011.
“Homebuyers need to remember, that even though the tax credit is about to expire, conditions remain ideal to buy a home,” said Jones. “There are plenty of existing homes on the market, interest rates are at near-record lows, and prices are very competitive.”
Saturday, April 17, 2010
Mortgage rates fall after rising 4 straight weeks
Mortgage Rate Trend Index
This week, 39% of the mortgage industry experts surveyed by Bankrate.com believe mortgage rates will rise over the next week or so. Another 22% think rates will fall, and the rest (39%) believe rates will remain relatively unchanged.
McLEAN, Va. (AP) – April 16, 2010 – Rates for long-term mortgages dropped this week but still remained above 5 percent, Freddie Mac said Thursday.
The average rate on a 30-year fixed rate mortgage was 5.07 percent this week, down from 5.21 percent a week earlier, a survey by the mortgage financier Freddie Mac said. Last week’s average rate for a 30-year fixed mortgage had been the highest since mid-August, when it was 5.29 percent.
Rates had dropped to a record low of 4.71 percent in December, pushed down by a campaign by the Federal Reserve to reduce borrowing costs for consumers. The program ended at the end of March, but the Fed left the door open to reviving the program if the economy weakens.
Low rates make mortgages less expensive for homebuyers.
“After rising for four consecutive weeks, mortgage rates eased back to where they were two weeks ago and still remain historically low,” said Frank Nothaft, Freddie Mac’s chief economist.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day, often tracking the interest rate paid on long-term Treasury bonds.
This week, the average rate on a 15-year fixed-rate mortgage was 4.40 percent, down from 4.52 percent last week.
Rates on five-year, adjustable-rate mortgages averaged 4.08 percent, down from 4.25 percent a week earlier. Rates on one-year, adjustable-rate mortgages dipped to 4.13 percent from 4.14 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.
The nationwide fee for loans in Freddie Mac’s survey averaged 0.7 of a point for 15-year loans, 0.6 of a point for 30-year and 5-year loans, and 0.5 of a point for 1-year loans.
Copyright © 2010 The Associated Press
Mortgage Rate Trend Index
This week, 39% of the mortgage industry experts surveyed by Bankrate.com believe mortgage rates will rise over the next week or so. Another 22% think rates will fall, and the rest (39%) believe rates will remain relatively unchanged.
McLEAN, Va. (AP) – April 16, 2010 – Rates for long-term mortgages dropped this week but still remained above 5 percent, Freddie Mac said Thursday.
The average rate on a 30-year fixed rate mortgage was 5.07 percent this week, down from 5.21 percent a week earlier, a survey by the mortgage financier Freddie Mac said. Last week’s average rate for a 30-year fixed mortgage had been the highest since mid-August, when it was 5.29 percent.
Rates had dropped to a record low of 4.71 percent in December, pushed down by a campaign by the Federal Reserve to reduce borrowing costs for consumers. The program ended at the end of March, but the Fed left the door open to reviving the program if the economy weakens.
Low rates make mortgages less expensive for homebuyers.
“After rising for four consecutive weeks, mortgage rates eased back to where they were two weeks ago and still remain historically low,” said Frank Nothaft, Freddie Mac’s chief economist.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day, often tracking the interest rate paid on long-term Treasury bonds.
This week, the average rate on a 15-year fixed-rate mortgage was 4.40 percent, down from 4.52 percent last week.
Rates on five-year, adjustable-rate mortgages averaged 4.08 percent, down from 4.25 percent a week earlier. Rates on one-year, adjustable-rate mortgages dipped to 4.13 percent from 4.14 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.
The nationwide fee for loans in Freddie Mac’s survey averaged 0.7 of a point for 15-year loans, 0.6 of a point for 30-year and 5-year loans, and 0.5 of a point for 1-year loans.
Copyright © 2010 The Associated Press
Wednesday, April 14, 2010
More keep up with mortgage payments
WASHINGTON – April 14, 2010 – The share of homeowners behind on their mortgages fell in the first quarter, the first drop in four years and a possible sign that the foreclosure crisis has peaked.
The portion of mortgages that were delinquent 30 days or more fell to 6.57 percent in the first quarter from 6.60 percent in the last three months of 2009, according to Equifax and Moody’s Economy.com.
That’s a drop of about 16,630 delinquent loans and, though modest, it is the first decline in the delinquency rate since early 2006.
“It will take years to work through all the troubled mortgage loans in the foreclosure pipeline, but this is the first indication that the number of loans entering the pipeline is declining,” says Mark Zandi, chief economist for Moody’s Economy.com. “It portends a peaking of the foreclosure crisis.”
Delinquencies in almost all categories – 30-, 90- and 120-day delinquencies on single-family properties – declined.
Reasons for the improvement in the foreclosure rate:
• Tougher lending standards since the housing bubble burst have kept riskier borrowers from getting mortgages.
• Mortgage modifications have helped tens of thousands of troubled homeowners stave off delinquencies.
• A more stable job market is preventing new mortgage delinquencies. The unemployment rate held steady at 9.7 percent in March, and non-farm jobs increased by 162,000.
“I wouldn’t be surprised if we’re at the peak,” says Joel Naroff of Naroff Economic Advisors.
But the foreclosure problem won’t disappear quickly. In the past two years, more than 5 million homes have received foreclosure notices, and more than 3 million are expected to get them this year, according to RealtyTrac.
One issue is strategic defaults by borrowers who walk away from their mortgages – even though they can afford to pay – because they owe more than their homes are worth.
Millions of homes have negative equity and perhaps 20 percent to 25 percent of recent defaults have been strategic, according to a new Moody’s Economy.com analysis. More strategic defaults could increase the pace of home foreclosures and hamper new borrowers’ attempts to get mortgages, it says.
“There is still a foreclosure problem that is going to cause people to lose their homes, but in terms of new delinquencies starting, those are probably at their peak,” Zandi says.
Copyright © 2010 USA TODAY
WASHINGTON – April 14, 2010 – The share of homeowners behind on their mortgages fell in the first quarter, the first drop in four years and a possible sign that the foreclosure crisis has peaked.
The portion of mortgages that were delinquent 30 days or more fell to 6.57 percent in the first quarter from 6.60 percent in the last three months of 2009, according to Equifax and Moody’s Economy.com.
That’s a drop of about 16,630 delinquent loans and, though modest, it is the first decline in the delinquency rate since early 2006.
“It will take years to work through all the troubled mortgage loans in the foreclosure pipeline, but this is the first indication that the number of loans entering the pipeline is declining,” says Mark Zandi, chief economist for Moody’s Economy.com. “It portends a peaking of the foreclosure crisis.”
Delinquencies in almost all categories – 30-, 90- and 120-day delinquencies on single-family properties – declined.
Reasons for the improvement in the foreclosure rate:
• Tougher lending standards since the housing bubble burst have kept riskier borrowers from getting mortgages.
• Mortgage modifications have helped tens of thousands of troubled homeowners stave off delinquencies.
• A more stable job market is preventing new mortgage delinquencies. The unemployment rate held steady at 9.7 percent in March, and non-farm jobs increased by 162,000.
“I wouldn’t be surprised if we’re at the peak,” says Joel Naroff of Naroff Economic Advisors.
But the foreclosure problem won’t disappear quickly. In the past two years, more than 5 million homes have received foreclosure notices, and more than 3 million are expected to get them this year, according to RealtyTrac.
One issue is strategic defaults by borrowers who walk away from their mortgages – even though they can afford to pay – because they owe more than their homes are worth.
Millions of homes have negative equity and perhaps 20 percent to 25 percent of recent defaults have been strategic, according to a new Moody’s Economy.com analysis. More strategic defaults could increase the pace of home foreclosures and hamper new borrowers’ attempts to get mortgages, it says.
“There is still a foreclosure problem that is going to cause people to lose their homes, but in terms of new delinquencies starting, those are probably at their peak,” Zandi says.
Copyright © 2010 USA TODAY
Tuesday, April 13, 2010
Experts aren’t ready to make the call on recession
WASHINGTON – April 13, 2010 – The recession is almost certainly over. We just don’t officially know it yet.
The National Bureau of Economic Research (NBER), the group that formally declares the beginning and end of recessions, said Monday it isn’t ready to declare that this downturn is over, though many leading economists firmly believe it is.
The NBER’s panel of erudite academics said most economic indicators “have turned up.” But noting that the data “are quite preliminary” and will be revised, it added that pinpointing the month the slump bottomed “would be premature.”
“It’s probably clearer to them that it’s over, rather than when it was over,” says Nigel Gault, chief U.S. economist of IHS Global Insight.
Nearly all signposts, including economic growth, industrial output, income and retail sales, have been trending upward in recent months. The economy grew a robust 5.6 percent in the fourth quarter and even added 162,000 jobs in March – the first significant gain since the recession started in December 2007.
In fact, several committee members recently said the recession is history. Citing March’s job growth, Jeffrey Frankel, a professor at Harvard’s Kennedy School of Government, wrote on his blog last week, “The recession is over.”
Such remarks are likely what prompted the committee to clarify Monday that it’s not prepared to officially make the call, says Conrad DeQuadros of Decision Economics. A big reason for the caution: The job market has yet to show two consecutive months of big increases. “It’s about lagging job growth,” says Allen Sinai of Decision Economics.
Another reason is this recession has been the longest and most punishing since the Great Depression. Many economists believe it ended in June, meaning it lasted 18 months. “I think we have to bear in mind we’re coming out of a very severe contraction of long duration,” Gault says.
In other words, there is still a chance the economy could slip back into recession, though economists say the risk has been shrinking. The committee pronounced the 1980 recession over in July that year, waiting a year to make the call. That might not have been long enough. The panel later declared a new slump began in July 1981, but some economists believe it was the 1980 slide’s continuation, DeQuadros says.
The committee’s prudence should not stir fears of a relapse, economists say. “We have an entrenched … and sustainable recovery,” Sinai says.
It’s not uncommon for the panel to be slow to call the start and finish of recessions. It took a year, 21 months and 20 months, respectively, to declare the 1980, 1991 and 2001 skids history. The latter two, like the current slide, were plagued by job markets that lagged overall recoveries as employers learned to produce more with fewer workers.
© Copyright 2010 USA TODAY
WASHINGTON – April 13, 2010 – The recession is almost certainly over. We just don’t officially know it yet.
The National Bureau of Economic Research (NBER), the group that formally declares the beginning and end of recessions, said Monday it isn’t ready to declare that this downturn is over, though many leading economists firmly believe it is.
The NBER’s panel of erudite academics said most economic indicators “have turned up.” But noting that the data “are quite preliminary” and will be revised, it added that pinpointing the month the slump bottomed “would be premature.”
“It’s probably clearer to them that it’s over, rather than when it was over,” says Nigel Gault, chief U.S. economist of IHS Global Insight.
Nearly all signposts, including economic growth, industrial output, income and retail sales, have been trending upward in recent months. The economy grew a robust 5.6 percent in the fourth quarter and even added 162,000 jobs in March – the first significant gain since the recession started in December 2007.
In fact, several committee members recently said the recession is history. Citing March’s job growth, Jeffrey Frankel, a professor at Harvard’s Kennedy School of Government, wrote on his blog last week, “The recession is over.”
Such remarks are likely what prompted the committee to clarify Monday that it’s not prepared to officially make the call, says Conrad DeQuadros of Decision Economics. A big reason for the caution: The job market has yet to show two consecutive months of big increases. “It’s about lagging job growth,” says Allen Sinai of Decision Economics.
Another reason is this recession has been the longest and most punishing since the Great Depression. Many economists believe it ended in June, meaning it lasted 18 months. “I think we have to bear in mind we’re coming out of a very severe contraction of long duration,” Gault says.
In other words, there is still a chance the economy could slip back into recession, though economists say the risk has been shrinking. The committee pronounced the 1980 recession over in July that year, waiting a year to make the call. That might not have been long enough. The panel later declared a new slump began in July 1981, but some economists believe it was the 1980 slide’s continuation, DeQuadros says.
The committee’s prudence should not stir fears of a relapse, economists say. “We have an entrenched … and sustainable recovery,” Sinai says.
It’s not uncommon for the panel to be slow to call the start and finish of recessions. It took a year, 21 months and 20 months, respectively, to declare the 1980, 1991 and 2001 skids history. The latter two, like the current slide, were plagued by job markets that lagged overall recoveries as employers learned to produce more with fewer workers.
© Copyright 2010 USA TODAY
Monday, April 12, 2010
Fed: Low rates likely through 2010
WASHINGTON – April 12, 2010 – Interest rates are likely to remain low into 2011, Federal Reserve policymakers hinted this week in at least two presentations. These indications came one week after the Fed shut down its program to buy mortgage-backed securities, which had kept rates at or near record lows in recent months.
In a speech Thursday, Fed Governor Daniel Tarullo said, “The relatively modest pace of recovery, the continued high rate of unemployment, subdued inflation trends, and well-anchored inflation expectations together suggest that the need for highly accommodative monetary policies will not diminish soon.”
Likewise, Donald Kohn, Fed vice chairman in a speech in San Francisco, said the Fed would raise rates, “in due course,” but he also noted that low rates “help offset the lingering restraining effects on economic activity and prices.”
So far, rates have risen modestly, but analysts speculate they will likely become much more volatile down the road.
“It’s an uncertain type of market,” says Keith Gumbinger of HSH.com.
Michael Fratantoni, vice president of research and economics for the Mortgage Bankers Association, predicts that the Fed will have created a situation where there are days or weeks of low-rate opportunities, and other days and weeks when rates rise significantly.
Sources: The Wall Street Journal
WASHINGTON – April 12, 2010 – Interest rates are likely to remain low into 2011, Federal Reserve policymakers hinted this week in at least two presentations. These indications came one week after the Fed shut down its program to buy mortgage-backed securities, which had kept rates at or near record lows in recent months.
In a speech Thursday, Fed Governor Daniel Tarullo said, “The relatively modest pace of recovery, the continued high rate of unemployment, subdued inflation trends, and well-anchored inflation expectations together suggest that the need for highly accommodative monetary policies will not diminish soon.”
Likewise, Donald Kohn, Fed vice chairman in a speech in San Francisco, said the Fed would raise rates, “in due course,” but he also noted that low rates “help offset the lingering restraining effects on economic activity and prices.”
So far, rates have risen modestly, but analysts speculate they will likely become much more volatile down the road.
“It’s an uncertain type of market,” says Keith Gumbinger of HSH.com.
Michael Fratantoni, vice president of research and economics for the Mortgage Bankers Association, predicts that the Fed will have created a situation where there are days or weeks of low-rate opportunities, and other days and weeks when rates rise significantly.
Sources: The Wall Street Journal
Friday, April 9, 2010
Rates on 30-year home loans rise to 5.21 pct
Mortgage Rate Trend Index
Industry experts polled by Bankrate.com this week are evenly divided on what will happen over the short term: 38% predict further increases, 31% foresee no change and 31% expect a decline.
WASHINGTON (AP) – April 9, 2010 – Rates for 30-year home loans surged last week, rising to the highest level in eight months due to the improving economy and the end of a government push to keep rates low.
The average rate on a 30-year fixed rate mortgage was 5.21 percent this week, up from 5.08 percent a week earlier, Freddie Mac said Thursday. That’s the highest since mid-August, when the average rate was 5.29 percent.
Rates had dropped to a record low of 4.71 percent in December, pushed down by a campaign by the Federal Reserve to reduce borrowing costs for consumers. The program ended last week, but the Fed left the door open to reviving the program if the economy weakens.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day, often tracking the interest rate paid on long-term Treasury bonds.
Treasury yields have climbed steadily in recent weeks because of weak demand. The government has had to offer a better interest rate to sell its bonds as investors shift toward stocks and riskier corporate debt.
The 10-year yield rose above 4 percent on Monday for the first time since June, but fell back to 3.85 percent on Thursday.
This week, the average rate on a 15-year fixed-rate mortgage was 4.52 percent, up from 4.39 percent last week.
Rates on five-year, adjustable-rate mortgages averaged 4.25 percent, up from 4.1 percent a week earlier. Rates on one-year, adjustable-rate mortgages rose to 4.14 percent from 4.05 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.
The nationwide fee for loans in Freddie Mac’s survey averaged 0.6 of a point for 30-year, 15-year and 5-year loans and 0.5 of a point for 1-year-loans.
Copyright © 2010 The Associated Press
Mortgage Rate Trend Index
Industry experts polled by Bankrate.com this week are evenly divided on what will happen over the short term: 38% predict further increases, 31% foresee no change and 31% expect a decline.
WASHINGTON (AP) – April 9, 2010 – Rates for 30-year home loans surged last week, rising to the highest level in eight months due to the improving economy and the end of a government push to keep rates low.
The average rate on a 30-year fixed rate mortgage was 5.21 percent this week, up from 5.08 percent a week earlier, Freddie Mac said Thursday. That’s the highest since mid-August, when the average rate was 5.29 percent.
Rates had dropped to a record low of 4.71 percent in December, pushed down by a campaign by the Federal Reserve to reduce borrowing costs for consumers. The program ended last week, but the Fed left the door open to reviving the program if the economy weakens.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day, often tracking the interest rate paid on long-term Treasury bonds.
Treasury yields have climbed steadily in recent weeks because of weak demand. The government has had to offer a better interest rate to sell its bonds as investors shift toward stocks and riskier corporate debt.
The 10-year yield rose above 4 percent on Monday for the first time since June, but fell back to 3.85 percent on Thursday.
This week, the average rate on a 15-year fixed-rate mortgage was 4.52 percent, up from 4.39 percent last week.
Rates on five-year, adjustable-rate mortgages averaged 4.25 percent, up from 4.1 percent a week earlier. Rates on one-year, adjustable-rate mortgages rose to 4.14 percent from 4.05 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.
The nationwide fee for loans in Freddie Mac’s survey averaged 0.6 of a point for 30-year, 15-year and 5-year loans and 0.5 of a point for 1-year-loans.
Copyright © 2010 The Associated Press
Thursday, April 8, 2010
Homebuyers scramble as mortgage rates jump
WASHINGTON – April 8, 2010 – The era of record-low mortgage rates is over.
The average rate on a 30-year loan has jumped from about 5 percent to more than 5.3 percent in just the past week. As mortgages get more expensive, more would-be homeowners are priced out of the market – a threat to the fragile recovery in the housing market.
And if you wanted to refinance at a super-low rate, you may have missed your chance. Mortgages under 4 percent are still available, but only for loans that reset in five or seven years, probably to higher rates.
Rates are going up because of the improving economy and the end of a government push to make mortgages cheaper.
For people putting their homes on the market this spring, rising rates may actually be a good thing. Buyers are racing to complete their purchases and lock in something decent before rates go even higher.
“We are seeing some panic among potential buyers who have not found houses yet,” said Craig Strent, co-founder of Apex Home Loans in Bethesda, Md. “They’re saying: Man, I should have found a house three weeks ago or last month when rates were lower.”
It’s all about affordability. For every 1-percentage point rise in rates, 300,000 to 400,000 would-be buyers are priced out of the market in a given year, according to the National Association of Realtors.
The rule of thumb is that every 1-percentage point increase in mortgage rates reduces a buyer’s purchasing power by about 10 percent.
For example, taking out a 30-year mortgage for $300,000 at a rate of 5 percent will cost you about $1,600 a month, not including taxes and insurance. But the same monthly payment at a rate of 6 percent will only get you a loan of $270,000.
Good economic news is the first reason rates are rising: U.S. government debt, a safe haven during the recession, is losing its appeal as investors turn to stocks and riskier corporate bonds.
Lower demand for debt means the government has to offer a better interest rate to sell its bonds. The yield on the 10-year Treasury note, which is closely tracked by mortgage rates, hovered above 4 percent this week, the highest since June, before falling back slightly.
The second reason is the Federal Reserve. Last week, the Fed ended its program to push mortgage rates down by buying up mortgage-backed securities. When demand from the central bank was high, rates plummeted to about 4.7 percent for much of last year. And business boomed for mortgage lenders as homeowners raced to refinance out of adjustable-rate mortgages and into fixed loans.
As of Wednesday, the Mortgage Bankers Association put the national average for a 30-year fixed-rate mortgage at 5.31 percent. One week ago, it was 5.04 percent.
Many analysts forecast rates will rise as high as 6 percent by early next year. If they go much higher, the already shaky housing recovery could stall. And that could slow the broader economic rebound.
In a normal market, with home prices steadily rising, a jump in rates doesn’t cause a big dip in demand. That’s because people know their homes will eventually rise in value, and are willing to accept a higher mortgage payment.
But now home prices are flat nationally and still falling in some places. Potential buyers are nervous about jumping in.
“In this environment, any rise in mortgage rates does significant damage because people don’t think they’re going to get their money back” if prices fall, said Mark Zandi, chief economist at Moody’s Analytics.
For people who bought their first home in the 1980s, when rates stayed over 10 percent for several years, paying 6 percent for a home loan may seem like a steal. But it’s coming as a shock to many first-time homebuyers this spring.
In Overland Park, Kan., Sirena Barlow checks mortgage rates online once a day. She’s been shopping for a something around $130,000 and wants to sign a contract this month, to take advantage of a tax credit for first-time homebuyers.
Barlow, a legal assistant, has already told her landlord she’s moving, so her stress level is high. Her real estate agent, Michael Maher, has been doing his best to calm Barlow and other clients, but rising rates are making them anxious.
“It’s like giving hyperactive kids ice cream,” he said. “It has really taken the ones who are focused on buying and amped them up a little bit.”
Copyright © USA TODAY 2010
WASHINGTON – April 8, 2010 – The era of record-low mortgage rates is over.
The average rate on a 30-year loan has jumped from about 5 percent to more than 5.3 percent in just the past week. As mortgages get more expensive, more would-be homeowners are priced out of the market – a threat to the fragile recovery in the housing market.
And if you wanted to refinance at a super-low rate, you may have missed your chance. Mortgages under 4 percent are still available, but only for loans that reset in five or seven years, probably to higher rates.
Rates are going up because of the improving economy and the end of a government push to make mortgages cheaper.
For people putting their homes on the market this spring, rising rates may actually be a good thing. Buyers are racing to complete their purchases and lock in something decent before rates go even higher.
“We are seeing some panic among potential buyers who have not found houses yet,” said Craig Strent, co-founder of Apex Home Loans in Bethesda, Md. “They’re saying: Man, I should have found a house three weeks ago or last month when rates were lower.”
It’s all about affordability. For every 1-percentage point rise in rates, 300,000 to 400,000 would-be buyers are priced out of the market in a given year, according to the National Association of Realtors.
The rule of thumb is that every 1-percentage point increase in mortgage rates reduces a buyer’s purchasing power by about 10 percent.
For example, taking out a 30-year mortgage for $300,000 at a rate of 5 percent will cost you about $1,600 a month, not including taxes and insurance. But the same monthly payment at a rate of 6 percent will only get you a loan of $270,000.
Good economic news is the first reason rates are rising: U.S. government debt, a safe haven during the recession, is losing its appeal as investors turn to stocks and riskier corporate bonds.
Lower demand for debt means the government has to offer a better interest rate to sell its bonds. The yield on the 10-year Treasury note, which is closely tracked by mortgage rates, hovered above 4 percent this week, the highest since June, before falling back slightly.
The second reason is the Federal Reserve. Last week, the Fed ended its program to push mortgage rates down by buying up mortgage-backed securities. When demand from the central bank was high, rates plummeted to about 4.7 percent for much of last year. And business boomed for mortgage lenders as homeowners raced to refinance out of adjustable-rate mortgages and into fixed loans.
As of Wednesday, the Mortgage Bankers Association put the national average for a 30-year fixed-rate mortgage at 5.31 percent. One week ago, it was 5.04 percent.
Many analysts forecast rates will rise as high as 6 percent by early next year. If they go much higher, the already shaky housing recovery could stall. And that could slow the broader economic rebound.
In a normal market, with home prices steadily rising, a jump in rates doesn’t cause a big dip in demand. That’s because people know their homes will eventually rise in value, and are willing to accept a higher mortgage payment.
But now home prices are flat nationally and still falling in some places. Potential buyers are nervous about jumping in.
“In this environment, any rise in mortgage rates does significant damage because people don’t think they’re going to get their money back” if prices fall, said Mark Zandi, chief economist at Moody’s Analytics.
For people who bought their first home in the 1980s, when rates stayed over 10 percent for several years, paying 6 percent for a home loan may seem like a steal. But it’s coming as a shock to many first-time homebuyers this spring.
In Overland Park, Kan., Sirena Barlow checks mortgage rates online once a day. She’s been shopping for a something around $130,000 and wants to sign a contract this month, to take advantage of a tax credit for first-time homebuyers.
Barlow, a legal assistant, has already told her landlord she’s moving, so her stress level is high. Her real estate agent, Michael Maher, has been doing his best to calm Barlow and other clients, but rising rates are making them anxious.
“It’s like giving hyperactive kids ice cream,” he said. “It has really taken the ones who are focused on buying and amped them up a little bit.”
Copyright © USA TODAY 2010
Tuesday, April 6, 2010
April is Fair Housing Month
WASHINGTON – April 6, 2010 – A Massachusetts family is billed by the landlord because their children played in an outdoor common area, and then fines the family when they file a fair housing complaint. An Alabama landlord is charged with turning off the water and evicting a white family because one tenant has an African-American boyfriend. An Illinois university student who is vision impaired and epileptic is refused dormitory housing because she has a trained service dog.
The U.S. Department of Housing and Urban Development (HUD) and private groups investigate these and other discrimination cases under the Fair Housing Act, 42 years after it became law in April 1968. In honor of Fair Housing Month, celebrated each April, HUD has declared 2010 a “Time to Act!”
The Fair Housing Act makes it illegal to discriminate in housing transactions based on race, color, national origin, religion, gender, disability or familial status. Each year HUD and communities and organizations across the country recognize Fair Housing Month by hosting an array of activities that enhance the public’s awareness of their fair housing rights. The theme for this year’s activities is “Fair Housing in 2010: Time to Act.”
HUD’s fair housing initiatives include an expanded effort to work with states and local communities to reinforce a federal requirement that they promote diverse, inclusive housing opportunities when spending federal funds. And for the first time, the Department is examining the prevalence of housing discrimination based on sexual orientation and gender identity, and discrimination based on a tenant’s use of government assistance to pay rent.
© 2010 Florida Realtors®
WASHINGTON – April 6, 2010 – A Massachusetts family is billed by the landlord because their children played in an outdoor common area, and then fines the family when they file a fair housing complaint. An Alabama landlord is charged with turning off the water and evicting a white family because one tenant has an African-American boyfriend. An Illinois university student who is vision impaired and epileptic is refused dormitory housing because she has a trained service dog.
The U.S. Department of Housing and Urban Development (HUD) and private groups investigate these and other discrimination cases under the Fair Housing Act, 42 years after it became law in April 1968. In honor of Fair Housing Month, celebrated each April, HUD has declared 2010 a “Time to Act!”
The Fair Housing Act makes it illegal to discriminate in housing transactions based on race, color, national origin, religion, gender, disability or familial status. Each year HUD and communities and organizations across the country recognize Fair Housing Month by hosting an array of activities that enhance the public’s awareness of their fair housing rights. The theme for this year’s activities is “Fair Housing in 2010: Time to Act.”
HUD’s fair housing initiatives include an expanded effort to work with states and local communities to reinforce a federal requirement that they promote diverse, inclusive housing opportunities when spending federal funds. And for the first time, the Department is examining the prevalence of housing discrimination based on sexual orientation and gender identity, and discrimination based on a tenant’s use of government assistance to pay rent.
© 2010 Florida Realtors®
Monday, April 5, 2010
New federal program for short home sales starts today
WASHINGTON – April 5, 2010 – Effective today, the short sale process is simplified. The only problem: Many lenders don’t know it, and Realtors may have to convince them.
The Home Affordable Foreclosure Alternatives (HAFA) program gives $3,000 to borrowers for relocation assistance, $1,500 to servicers for administrative and processing costs, and up to $2,000 to investors who allow up to $6,000 in short sale proceeds to be distributed to subordinate lien holders. The program was created to help stabilize distressed inventory such as underwater homes.
Some lenders have already adopted HAFA rules, but April 5 was the deadline for participating servicers to implement HAFA. The program reportedly covers servicers handling more than 90 percent of all mortgages.
However, the National Association of Realtors (NAR) says that it’s already hearing complaints from members. Many servicers say they haven’t even heard about the program, Realtors claim, so it’s clear that they won’t “hit the ground running.”
NAR says it will carefully monitor HAFA implementation and report delays and other program problems to the Treasury Department. However, “patience will be needed.” Realtors can negotiate faster short sales by urging lenders to comply with the new procedures and deadlines.
NAR offers a webpage with information on how HAFA works at: www.realtor.org/shortsales.
NAR also offers other short-sale info (including links to a 45 minute Webinar and a 15 minute video on a separate webpage: http://www.realtor.org/realtors/basics_short_sales?wt.mc_id=rd0041.
NAR also produced a four-page HAFA informational brochure.
U.S. Treasury Department guidelines and forms (updated March 26, 2010):
https://www.hmpadmin.com/portal/programs/foreclosure_alternatives.html.
© 2010 Florida Realtors®
WASHINGTON – April 5, 2010 – Effective today, the short sale process is simplified. The only problem: Many lenders don’t know it, and Realtors may have to convince them.
The Home Affordable Foreclosure Alternatives (HAFA) program gives $3,000 to borrowers for relocation assistance, $1,500 to servicers for administrative and processing costs, and up to $2,000 to investors who allow up to $6,000 in short sale proceeds to be distributed to subordinate lien holders. The program was created to help stabilize distressed inventory such as underwater homes.
Some lenders have already adopted HAFA rules, but April 5 was the deadline for participating servicers to implement HAFA. The program reportedly covers servicers handling more than 90 percent of all mortgages.
However, the National Association of Realtors (NAR) says that it’s already hearing complaints from members. Many servicers say they haven’t even heard about the program, Realtors claim, so it’s clear that they won’t “hit the ground running.”
NAR says it will carefully monitor HAFA implementation and report delays and other program problems to the Treasury Department. However, “patience will be needed.” Realtors can negotiate faster short sales by urging lenders to comply with the new procedures and deadlines.
NAR offers a webpage with information on how HAFA works at: www.realtor.org/shortsales.
NAR also offers other short-sale info (including links to a 45 minute Webinar and a 15 minute video on a separate webpage: http://www.realtor.org/realtors/basics_short_sales?wt.mc_id=rd0041.
NAR also produced a four-page HAFA informational brochure.
U.S. Treasury Department guidelines and forms (updated March 26, 2010):
https://www.hmpadmin.com/portal/programs/foreclosure_alternatives.html.
© 2010 Florida Realtors®
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