Annapolis Maryland - High Quality Mortgage Advice

An ActiveRain Epiphany...

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Wed, 09 Feb 2011 01:20:28 -0500

We're just two lost souls swimming in a fish bowl......

For those of you that know me I apologize for being absent for so long. As the mortgage industry changed the last few years I found myself pulling away from originating loans. I grew a horrible distaste in my mouth from the whole damn mortgage / real estate. Point your finger all you want, there were some top notch, highly respected peeps that went down side by side with housing values. I've had a realization in the past year or so, even more in the past six months as I grow my social media platforms.

The foundations of successful blogging such as posting high quality content, engagement, finding your audience, keywords and keyword placement, how to title a blog... the real foundations I learned here on Active Rain. I am not going to refer any one person by name. The ones around when I started know who I am talking about. Many are no longer blogging. Some have even passed away. There was some really good bloggers and there were some really close bonds formed. It was a very tight group, everyone learning new social media techniques and engaging with one another. There were true blogging artists that not only nailed the content, they displayed an eye for layout and design as well and understood where and when to include a link. They became masters of engaging and ambassadors of transparency. They "got it".

What I learned in days past from ActiveRain.com were the basics. May sound trivial but trust me it is very relevant. I have spent the past five months or so engaging on @twitter. I have also been very active on Linkedin the last 3+ years. The basics I learned over the past years blogging on ActiveRain.com has helped me understand other platforms much more effectively today. Understanding other platforms is very hard to do, please do not think otherwise. Transparency is the foundation of what it is all about. Some get it and some never do. I have been attending as many social media seminars and webinars as I can lately. I have seen some real rockstars that I could legitimately call "Expert". (I really do hate that word).... They "get it".

Where am I going with all of this? I read a blog tonight that knocked my socks off. No kidding. It may have been one of the best posts I have ever read. I wanted to share this with all my ActiveRain buds from way back.

Read this blog. I promise you will feel the same way as I did. -> "Hashing it Out" by Robert Ortiz - Click Here

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"I am not in the mortgage business - I am a highly skilled mortgage banker who is in the customer service business."

I can't believe what I just read -->> Are the crooks still in charge?

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Wed, 22 Dec 2010 17:24:23 -0500

Are the crooks still in charge?

I just came across this post and just can't believe what I have read...

"The nonprofit Homeownership Preservation Foundation, the official body charged with resolving disputes over HAMP modifications, was founded by ResCap and to this day is run by GMAC and other finance officials from within the mortgage industry."

click here to read the full story

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"I am not in the mortgage business - I am a highly skilled mortgage banker who is in the customer service business."

Market Segmentation - Understanding your Audience

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Tue, 07 Dec 2010 16:22:20 -0500

MARKET SEGMENTATION is customer driven claims NICK COUTTS . - Let me explain....

Sometimes the most elementary concepts are simply not recognized. I have been guilty of overlooking the obvious many times. But through countless books, seminars, webinars, lectures, classes, chats, blogs and comments a common theme resonates amongst the "experts".

How? Why? When?

Do you really know your audience? Sure it is a silly question but I see people and businesses every day marketing their product to an audience who is not listening. If you are selling product "A", common sense tells us to go where product "A" hangs out, lives, breathes, sleeps, eats etc...

Understanding Market Segmentation - The evolving world of social media is allowing us to really drill down and fine tune exactly who we want to reach. This has eliminated a lot of the waste in marketing time and expense. But first we have to answer the questions - How? Where? Why? - Once we answer these fundamental questions you can then begin ENGINEERING YOUR ROUTES TO MARKET.

I attended the recent Philly #RainCamp and one of my favorite speakers, Ben Kinney , gave the audience some very powerful tips on SEO, blogging and really drilling down keywords in order to find your true audience. If you have not downloaded Soci@l the Book just click the hyperlink, pull up a chair and take it all in. Just Do It! #raincamp

I found this video by former IBM VP for global distribution and channel strategy Nick Coutts to be very informative in answering the three questions - if this concept works for the Enterprise Marketplace shouldn't it be applied to small business on any level?

HOW? WHERE? WHEN? - UNDERSTANDING MARKET SEGMENTATION and ROUTES TO MARKET

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"I am not in the mortgage business - I am a highly skilled mortgage banker who is in the customer service business."

TARP Has Failed Homeowners

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Thu, 02 Dec 2010 17:31:46 -0500

TARP is NOT working - of the 46.6 billion dollars allocated to the HAMP program, only .6 billion dollars has been spent. That's only 1.3% of the total allocated. TARP Has Failed Homeowners -

Don't believe me? Read the 338 page report

Via Gail Robinson, GRI, e-PRO - Black Rock Connecticut Real Estate (William Raveis Real Estate):

Since TARP was authorized in October 2008, more than 7 million homeowners have received foreclosure notices and more than 11 milliion homeowners are underwater on their mortgages. Home values have dropped 28% and we have 14.9 million unemployed. Mortgages are increasingly more difficult to obtain with new underwriting rules requiring higher FICO scores, more money down, and making it difficult for self-employed people to qualify.

As real estate professionals we should take the time to skim through this 338 page report by the Officer of the Special Inspector General for TARP rather than rely on the glowing reports from the Treasury Department. This report shows that of the 46.6 billion dollars allocated to the HAMP program, only .6 billion dollars has been spent. That's only 1.3% of the total allocated.

HAMP encourages loan servicers and investors to modify mortgages through incentives. There is no requirement for the lenders who accepted TARP funds to modify a certain number or dollar amount of loans.

My question is why don't the lenders modify more mortgages given the incentives in TARP? Is there more to be gained by foreclosing on homes than modifying mortgages? There must be a reason that goes beyond ineptitude on the part of lenders. What do you think the reason is?

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"I am not in the mortgage business - I am a highly skilled mortgage banker who is in the customer service business."

Zillow Launches A Free Online Agent Endorsement System

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Thu, 02 Dec 2010 17:11:43 -0500

Zillow.com - the online property valuation website has just launched a Free Online Endorsement System - In the tradition of marketplace website ratings systems similar to amazon.com and ebay.com, agents will be rated by their clients, not reviewed by someone who may be partial to others. The internet is powerful and viral these days, ratings systems that are transparent keep companies and individuals on their toes.

Via Sara Bonert {Real Estate Internet Marketing} (Zillow):

Zillow Launches A Free Online Agent Endorsement System

Today, Zillow launched Zillow Ratings and Reviews - or basically an endorsement system on the site for real estate professionals. It is a way for consumers to review real estate agents they've worked with in the past to assist other consumers in the agent selection process. But want to know the other big winner here? Great agents! They are the ones that will flourish and rise to the top.

How can I easily collect reviews from past clients?

Email individual clients and ask them to fill out a review form on Zillow. To streamline this process, you can pre-populate the form with the address of the home you helped them buy or sell, and fill in the service you provided (buyer's agent, seller's agent, etc).

Email up to 50 clients a day with a standard form asking them to review you on Zillow.

If a past client is viewing your Zillow profile, they can click the ‘write a review' button and will be directed to the ratings and reviews form.

Who can review me?

Any client, past or present, can review you regardless of when the transaction closed.

The reviewer must have an active profile on Zillow.

Agents cannot review other agents.

How are reviews moderated?

Zillow's customer service team personally looks at every single review before it is published, to ensure that it adheres to Zillow's Good Neighbor Policy and is respectful and appropriate. If we feel a review does not comply with our Guidelines and Policies, or is generally inappropriate or off-topic, we won't post it.

Can I respond to reviews?

Yes. Agents will be notified when a review has been written about them and have the opportunity to publically respond to all reviews. Additionally, agents can flag reviews they feel are inaccurate or unjust for further review by Zillow's moderators.

What I really want to highlight is that Zillow understands the power of reviews for both consumers and agents, and has a dedicated customer service team in place that will personally look at EVERY SINGLE REVIEW before it is published.

As I said in the beginning, this new endorsement system is going to be an excellent opportunity for great agents--similar to how great restaurants thrive on Yelp. In the NAR 2010 Home Buyer and Seller survey that just came out, it said that 87% of consumers would recommend or use their agent again in the future. Now these past clients can tell your future clients why!

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"I am not in the mortgage business - I am a highly skilled mortgage banker who is in the customer service business."

Recognizing Active Rain trailblazers from the early days -

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Wed, 24 Nov 2010 10:23:18 -0500

The early days....

I have been a member of Active Rain since January 29, 2007. Sure seemed to be a bit different back then huh? Nobody was concerned with points or status. It was a small handful of professionals with passion and energy, doing what they love to do and talking about it the whole way. It was about spreading high quality information rather than self promotion. It was about forming bonds with other high quality professionals and knowing they would be there for you, ears wide open and ready to help. Although it has only been three years or so since I first started socially engaging with AR, reflecting back to 2007, I clearly see that many of the early Active Rainers are not now AR legends, but they are blogging trailblazers.

If you are an AR veteran, click on your comments in the left side bar. I find myself shaking my head as i pull up posts from 2007, at just how naive we all were regarding social networking and just how much the group below laid the foundation of social networking basics. It's always fun to read old posts regarding the future and see what Active Rain member really had their finger on the pulse. Is there a list of all time best posts on AR?

Looking over the profiles of my associates, I chuckle as it becomes more obvious some of these early pioneers of Active Rain, experts themselves in their chosen profession, are now viewed as a top tier social networker first, then their chosen profession next. They have branded themselves successfully. I wish everyone of my friends success in building their own personal brand. But mostly, the ones that are still actively or even occasionally contributing, I want to extend a hearty congratulations for staying the course. This group I am talking about are survivors and adapted to a horrible economy in a business that thrives in the good times and sinks in the bad.

Here are a few associates of mine from the early days. I apologize if i have left anyone out. This is just my way to pay homage and give recognition to my early Active Rain influencers. These names are in no particular order. As I see them in my associate list I am adding them below. Love them or not, they all deserve to be recognized. Thank you all for allowing me to contribute along the way -

Christine Costa - John Novak - Debe Maxwell - TLW - Broker Bryant - Mariana Wagner - Paul Chaney - Thesa Chambers - Jeff Dowler - Sally Cheeseman - Missy Caulk - David Podgursky - Rob Blake - Jason Sardi - Esko Kiuru - Ed Rybczynski - Robert Ashby - John MacArthur - Danny Thornton - Jeff Turner - Martha Brown - Bo Hussung - Pat Kennedy - Tom Elder - Margaret Woda - Jeff Belonger - Midori Miller - Karl Christen - Fred Glick - Lew Corcoran - Gerry Suarez - Fred Chamberlin - Ken Cook - Mirela Monte - Tom Burris - Renee Burrows - Brian Block - Fernando Herboso - Bob Stewart - Jim Crawford - Paul McFadden - Kate Bourland - Charles McDonald - Ben Kinney - Matt Rosov - Coleen Craig - Larry Bettag - Matt Blum - Gary Miljour - Richard Iarossi - Lenn Harley - Brian Tutus - Ed Brophy - Jason Price - George Souto - Randy Bolten - Janet Guilbault - Bill Burress - Jay Thompson - Brad Andersohn - Jeff Judge - Scott Geary - Aziz Abdur-Raoof - Andrew Scherer - Bill Archambault - Scott Gormley - Chris Ohlsen - Rich Sweum - Ken Montville - Lanre Folayan - Sara Bonert - Bill Nazur - Mike Mueller - Mike Jones - Eleanor Thorne - Stanley Barsch - Brian Brady - Ellie McIntire - Bill Ladewig - Donna Harris - Loreena Yeo - Ed Nailor - June Piper-Brandon - Rhonda Porter -

Do you know of an early Active Rain contributor not on this list? Please recognize them and add their name below.

I wish all my AR friends I have met along the way a Happy Thanksgiving, a safe holiday season and a prosperous 2011. - Stay the Course - Lewis Poretz

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203K video tutorial

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Tue, 26 Oct 2010 23:13:20 -0400

Check out this video from highly regarded 203k consultant Gary Smith who calls Mississippi home.

Gary has also started a great web page www.203kforum.com where consumers can learn all they need to know before entering into this very misunderstood loan.

Maryland 203K Loans - Baltimore 203K Loans - the Happy Renovation Loan - FHA 203K Loans -

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203K LOANS can make your dreams come true!

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Sun, 17 Oct 2010 11:07:26 -0400

HUD's 203K REHAB LOANS - an Fha product

FHA 203K loans offers consumers the ability to purchase and renovate a house with just one settlement. This simplifies the traditional construction process, which many times involves two loan closings, high fees and balloon loan payments hat can be called at a given time.

The current economic client of foreclosures and strategic defaults has left a glut of homes for sale that need work. These homes often referred to as a fixer upper, are perfect candidates for HUD's 203K rehab loan. Because they are guaranteed by HUD they are underwritten with the consumers best interest in mind. And because they fall under FHA guidelines, the approval process is clearly defined.

First time home buyers can take advantage of the 203K. The combination of depressed home values and a glut of properties that need rehabilitation should put first time home buyers in the drivers seat when discovering their options. But take my advice and only work with lenders and real estate agents that have experience with his product. The 203K Rehab Loan is not a difficult loan to close, but without experience with these loans it could turn out to be a very frustrating process. Experience is key with this product.

The 203K can be used for purchase and refinance transactions. Interest rates are very competitive with current market rates. Appraisals are based on future value. Your home ownership dreams can come to life. As with any new venture, understanding the product is key. Seek high quality mortgage advice when dealing with this product.

MARYLAND 203K LOANS - MARYLAND REHAB LOANS

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FHA 203(k) Program – What It Is, What It Does and What It Means to You!

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Fri, 15 Oct 2010 21:35:46 -0400

Are you looking to purchase a home? If you want to get the most bang for your buck with the glut of fixer uppers on the market, I suggest you understand the 203K loan.

Via Danielle "Dee" Baldwin (Fort Collins Realtor @ Infinity Group Realty):

The Federal Housing Administration (FHA) administers various single family mortgage insurance programs, including a few that provide for the rehabilitation and repair of single family properties such as the 203k and Streamlined 203k program (to be covered next week). As the Departments primary rehabilitation program, the Section 203(k) program is a tool for revitalizing neighborhoods hard hit by today's tough economic times and high foreclosure rates.

How the 203(k) Works

Most mortgage plans provide financing where the current condition and value of the property provides adequate loan security (loan equal or less than current value). Homes in need of repair or modernization require a homebuyer to obtain financing to purchase, plus additional financing for the construction and then a permanent mortgage once repairs are finished. The interim loans often carry high interest rates and short amortization periods, leaving the homebuyer with a much higher cost.

In contrast, the 203(k) allows the borrower to secure a loan equal to the current value PLUS a reasonable addition for rehabilitation by appraising the homes project value after repairs.

Eligible Property

Eligible properties must be a 1- to 4-family dwelling that is at least one full year old, fits local zoning requirements and not a 'cooperative' unit. Demolished homes (or those to be demolished) are eligible if the existing foundation system remains in place. Single family dwellings can also be converted to additional family units or vice-versa. Additional property eligibility can be determined through your local FHA approved lender.

How the Program Can Be Used

To purchase a dwelling and the land on which the dwelling is located and rehabilitate it.

To purchase a dwelling on another site, move it onto a new foundation on the mortgaged property and rehabilitate it.

To refinance existing liens secured against the subject property and rehabilitate the dwelling.

Eligible Improvements

Homeowners can use the 203(k) program to finance most 'non-Luxury' items/improvements such as room additions, decks, painting, carpet, etc. Health, safety and energy conservation improvements must be done prior to completing general home improvements. Required energy improvements include weatherstripping, reducing air infiltration (caulk/seal openings), insulation, HVAC pipe and duct insulation, attic and crawl space ventilation and any additional requirements per 24 CFR Part 39 and 200.926d. All room additions must meet HUD's new construction requirements.

Maximum Mortgage Amount

The mortgage amount (plus any existing debt against the property) cannot exceed the maximum dollar amount limitations and applicable loan-to-value ratio prescribed for similar properties. The maximum dollar amount is the lesser of:

The As-is value or purchase price before rehabbing (whichever is less) plus the estimated cost of rehabilitation

110% of the After-Improved value of the property

In addition, the repair or rehabilitation escrow amount cannot exceed $35,000. (Update: This limitation is for the Streamlined 203k, which I'll cover in a future post.)

I hope this helps provide a little insight into this helpful program. Additional information can always be found at the FHA website.

If you have any questions on how the 203(k) program works, please feel free to leave me a comment below!

Brought to you by:

Danielle "Dee" Baldwin

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Twitter.com/Infinitdee

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Brought to you by:

Danielle "Dee" Baldwin
Infinity Group Realty

www.Dee-Baldwin.com

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"I am not in the mortgage business - I am a highly skilled mortgage banker who is in the customer service business."

Foreclosure Warning: 20% Of All Homeowners Expected To Default | 11 Million At Risk Of Foreclosure

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Tue, 12 Oct 2010 14:36:08 -0400

Tim and Julie Harris have put together an excellent post reading where home foreclosures are now and the road they could possibly take very soon.... and it may not be pretty... check it out ->>

Via Tim and Julie Harris (Harris Real Estate University):

Warning: The Blog Post Contains Serious Real Estate Doom and Gloom. Avoid Operating Heavy Machinery and Drinking Alcohol While Consuming This Information.

Harris Real Estate University students live by the mantra, “Hope for the best but, be prepared for the worst”.

That mindset will allow you to be over prepared.

When the bad housing news hits you are not emotionally (or financially) devastated. Get ready, because what you are about to read can only be translated as bad housing news…some of you will be surprised and maybe a little shocked. Please don’t let your emotions get the better of you. Fact is, even in a market like this one there are still huge opportunities.

One of the best opportunities now? Being the agent with the bank foreclosures…as a REO Listing Agent. (and making money now from BPOs). Watch the FREE RSD (REO Specialist Designation) video and download the FREE how-to list REOs book.

Here are the talking points of a new just-released study by Amherst Securities Group.

* Up to 20% of ALL HOMEOWNERS could default….agents, that would mean a 20% foreclosure rate!

* Of all the homeowners who are just 20% upside down its predicted that 75% will default..that equals millions of homes that will become Short Sale listings or eventual REO listings.

* 11.5 million borrowers are in danger of losing their homes. The Obama Administration official Elizabeth Warren has predicted that there could be as many as 18,000,000 foreclosures.

* Amherst calls for: Mandatory principal reductions, looser underwriting of new mortgage loans, leveraged capital pools for investors, and penalties for defaulting homeowners.

* They suggest that borrowers are staying payment free in their homes for an average of 20 months! This study was done BEFORE the whole robo-signer mess came to light. Its realistic to believe that most defaulted owners will stay payment free for 2-3 years. In states like Florida and New York the current time from first missed payment to vacating the property is well over 2 years.

Agents, the last thing someone didn’t pay was their home. Afterall, they needed a place to live. Folks for forgo making car payments, credit card payments…and resorting to eating ramen noodles. Now, they just stop making their house payment. Missing mortgage payments has become upside down owners form of financial stimulus.

* Amherst wants those ‘living free’ to pay up. In the form of their missed payments, taxes and HOAs being treated as regular W2 income. (Good luck with that one fellas)

Amherst predicts over 11 million homeowners will default and lose their home if the government fails to take more radical intervention.

Amherst Securities Group LP, one of the most respected names in mortgage research, has trumpeted an ambitious call-to-government arms in its October mortgage report.

“The death spiral of lower home prices, more borrowers underwater, higher transition rates (to default), more distressed sales and lower home prices must be arrested.”

The authors dismiss recent talk of mortgage performance improvement as statistical sleight-of-hand magically conjured by modifications.

“This ‘improvement’ (in mortgage performance) simply reflects large scale modification activity having served to artificially lower the delinquency rate” (Please see the chart above of mortgage balances delinquent and re-performing. All charts in this post are from “Amherst Mortgage Insight” dated October 1, 2010.).

The report offers an astounding forecast of the fate of severe negative-equity properties. Nineteen percent of properties with a loan-to-value (LTV) of 120% or greater are defaulting every year. A death-defying 75% of mortgages on 120% LTV properties will eventually go bad (19% + 19% + 19%, …).

The current crop of mortgages is already “impaired” at the one-of-five level. Nine of 100 are seriously delinquent. Six of 100 are “dirty current” (made current by modification). Five of 100 are seriously underwater (LTV greater than 120%) (Please see the chart above categorizing the forecast of 11 million defaults.).

The authors, who describe current conditions as leading to “an impossible number” of defaults and one that is “politically unfeasible”, unveil a major arms race of measures to counteract the default tide.

The solutions include mandatory principal reductions, looser underwriting of new mortgage loans, leveraged capital pools for investors, and penalties for defaulting homeowners. Amherst reports that a family who defaults can live rent-free for 20 months on average. They propose that missed mortgage payments, including property taxes and insurance, be counted as W2 income.

They make note of recent new signs of distress including two record-low readings of existing home sales in the last two reports. Another block is that underwriting standards have grown much stricter at Fannie and Freddie. Only 2% of Freddie purchases are now bad-credit borrowers where they represented about 20% of borrowers in 2006. FHA purchase mortgages, however, which have by definition much more lenient lending guidelines, have exploded upwards from roughly 10% of their lending in 2006 to more than 50% today.

The buyer pool is also compromised by the fact that 17% of borrowers now have a seriously compromised credit history. After mortgage default a typical wait-time to qualify again is anywhere from 3 to 7 years. One of the more desperate measures suggested by the authors seeks a new mortgage for those who are now behind or in danger of failing. “This (default) can be fixed by re-qualifying borrowers who are in a home they can’t afford into one they can afford.”

Risk is so high in today’s real estate market that private money has largely left the mortgage category. The retreat is most easily seen in the jumbo mortgage market. Total jumbo mortgage origination has fallen from a high of $650 billion in 2003 to $92 billion in 2009 (see the chart above). Government loans account for 90% of current originations.

“If government policy does not change, over 11.5 million borrowers are in danger of losing their homes (1 borrower out of every 5),”‘ the report said, which estimates the total of homes with a first mortgage at 55 million. “Politically, this cannot happen.”

Source: HousingStory.com

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Will the second dip be worse than the first?

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Thu, 23 Sep 2010 09:34:43 -0400

Oh my bad...

I didn't realize you were one of the many consumers who bought in to the fact that the recession officially ended last year and has been declared over. As for me, an Annapolis, Maryland Mortgage Banker who pulls credit, reviews income and understands current property value trends, I say we may have never ended the first dip...

Political spin may send this country into a tailspin if consumers continue to buy into what the government tells us. Do yourself a favor and measure the state of the economy yourself.

Ask yourself, your family and your friends - Are you in better financial shape than your were last year?

Key indicators would be responses from local businesses, restaurants, dry cleaners, marinas, car dealers and on and on... American consumers are not spending any disposable income to stimulate the economy. That is if they have any disposable income left after paying the necessities to survive.

Check out this FREE poll, cast your vote and share your comments with industry experts and interested consumers.

click here to take the poll

Annapolis MARYLAND Fannie Mae HomePath Lender - Learn about this fantastic financing option - Click Here

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How bad will a double dip be? - take the poll

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Mon, 30 Aug 2010 14:37:35 -0400

President Obama spoke from the rose garden today. On TV he appeared clearly concerned that the effective one trillion dollars we have spent so far on this economic crisis is not working. Home sales plummeted last month. Unemployment sits around 10%. Housing prices continue to decline. Credit continues to decline. Income continues to decline. Why wouldn't he appear worried? After all, wouldn't you think he is more in touch on the realities of the economic landscape than anyone else?

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"I am not in the mortgage business - I am a highly skilled mortgage banker who is in the customer service business."

HFA -Another Government Foreclosure Help Program For Homeowners

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Sat, 14 Aug 2010 22:53:48 -0400

Via Nestor & Katerina Gasset Realtors® Wellington Florida Luxury Homes (International Properties and Investments, Inc.):

The US Department of Treasury has another government help program for homeowners who are underwater. We can be sure of one thing, what ever the program says it is going to do, rarely does.

We learned from the HAMP program that it never even touched the total number of projected homeowners it was supposed to help. HAMP is the government Home Affordable Loan Modification Program.

Read here for more details- Has Your Short Sale Or Loan Modification been turned down?

Then we had the US Treasury Department roll out the HAFA program- How's That HAFA Program Working Out For You?

That was another program that was going to help hundreds of thousands of homeowners but of course did not apply to Fannie Mae or Freddie Mac. So they threw the lenders a few bones to get them motivated to put homeowners into the HAFA program for their short sales and deed in lieus.

Well, I think we all know how these two programs are working out.

Read here to see a story of just one homeowner who is now losing his home because of the HAMP program.

Neither of these programs are working out well for the millions of homeowners who are underwater on their homes and who are in foreclosure.

The states hardest hit by the housing crash are also the states with the highest underwater mortgages so rarely do any of these programs help.

So what is the next best step? Throw more money at the problem and ignoring the disease.

The US Department of Treasury program is like a last ditch effort to attempt to fly in as Superman and save the day for thousands and thousands of homeowners who are about to lose their homes.

Here is an overview of the bail out program:

There are two programs- Hardest Hit Fund and HUD Emergency Homeowners Loan Program

The Hardest Hit Program gives Federal Money ( that they don't have) to States hardest hit with unemployment. This money is set help assist non profit community organizations to help provide assistance to save the homes of homeowners who are unemployed until they find employment.

The HUD Emergency Homeowners Loan Program will be giving out bridge loans to homeowners in hardest hit areas and these loans will be distributed by state and local non profit groups.

The loans offer a declining balance, they are zero interest loans and the maximum loan will be $50,000 to help the homeowner make their mortgage payments, interest, mortgage insurance, taxes and hazard insurance payments for up to 24 months. This is a bridge loan.

Homeowners must be at least 3 months behind on their payments and have a "reasonable likelihood" of being able to continue their payments within 2 years.

The homeowners must have a mortgage on their principle residence, their primary home.

Homeowners may not own more than one home.

They must be able to show that before they were unemployed or whatever the emergency that they were making their payments.

The targeted areas will be announced shortly.

Now here is the good stuff. Remember always the new golden rule- If you work your butt off to pay your mortgage payment on time, to heck with you. If you work 3 or 4 jobs to keep current on your mortgage payments- you are not worth helping. If you follow the rules, they don't have to.

Again, as with HAMP and HAFA and the lack of success with those programs, I will say,

Don't hold your breath on this one either.



To view Welington Florida short sales Click here. We know  Wellington Florida Real Estate and Wellington Florida Short Sales and will help you get your home Sold if you need to Sell your home and help you buy your home in Palm Beach County Florida: Call us today.





Copyright © By Katerina Gasset 2010 * HFA- Another Government Foreclosure Help Program For Homeowners*

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AHS - American Home Shield - Not Very Impressive

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Thu, 12 Aug 2010 00:43:42 -0400

American Home Shield not so impressive so far. @1sthome attn: David J. Crawford - President AHS

AHS could not find a competent HVCC tech to fix my heat pump. I spent several days of 95+ degrees and high humidity without AC... Finally they found a tech who appeared to be a complete sketch ball.

The AHS approved tech told me on the phone to be certain to have my checkbook because AHS hardly ever covers what needs to be replaced and he is not going to work for nothing... he complained that he never gets paid when he makes service calls for AHS... needless to say, I cancelled his service call... Because AHS was unable to find one of their approved technicians they told me to hire my own.

I had already been told by 4 different shops my compressor and air handler inside needed to be completely replaced. All four companies who came out and gave me estimates told me that. They said I was lucky to get 20 years out of them but they were no longer serviceable nor efficient.

When my tech called American Home Shield for authorization, the AHS inside customer service person, who refused to give me his last name, only authorized the outside unit to be replaced. They wanted the inside unit to have parts replaced first. This also meant I would be approved only for the old style compressor that is rarely used anymore for new installs. In fact, R 22 refrigerant is being phased out...

I believe they are dragging their feet on replacing a 20 year old heat pump. My compressor locked up. It was 20 years old. It was dead...My installer said you must replace inside and outside units together when they are that old. AHS warranty approved me for a new outside unit (which is old technology) and told the tech to start replacing parts on the inside handler. My tech refused and said if he did he would be back next week to replace it. He also refused to replace the heat pump with the same old style technology that is not energy efficient.

Any HVCC techs out there who can add some thought to this?

Hopefully @AHS @DavidCrawford @JudyPeedic read this post. I will be calling AHS tomorrow to try and make this right and will report back the outcome.

Why was I skeptical from the start?

Read the reviews for American Home Shield here-->> click here

I wonder if anyone at American Home Shield, otherwise known as Service Master has ever read the information below regarding the phase out of the type of unit they want me to continue to repair.....

A Common Sense Approach To Servicing Your SystemAlong with prohibiting the production of ozone-depleting refrigerants, the Clean Air Act also mandates the use of common sense in handling refrigerants. By containing and using refrigerants responsibly -- that is, by recovering, recycling, and reclaiming, and by reducing leaks -- their ozone depletion and global warming consequences are reduced. The Clean Air Act outlines specific refrigerant containment and management practices for HVAC manufacturers, distributors, dealers and technicians. Properly installed home comfort systems rarely develop major refrigerant leaks, and with proper servicing, a system using R-22, R-410A, or another refrigerant will reduce its impact on the environment.

While EPA does not mandate repairing or replacing small systems because of leaks, system leaks can not only harm the environment, but also result in increased operation and maintenance costs. One important thing a homeowner can do for the environment, regardless of the refrigerant used, is to select a reputable dealer that employs service technicians who are EPA-certified to handle refrigerants. Technicians often call this certification "Section 608 certification," referring to the part of the Clean Air Act that requires minimizing releases of ozone-depleting chemicals from HVAC equipment.

A Common Sense Approach To Purchasing New SystemsAnother important thing a homeowner can do for the environment is to purchase a highly energy-efficient system. Energy-efficient systems result in cost savings for the homeowner. Today's best air conditioners use much less energy to produce the same amount of cooling as air conditioners made in the mid-1970s. Even if your air conditioner is only 10 years old, you may save significantly on your cooling energy costs by replacing it with a newer, more efficient model. Products with EPA's Energy Star® label can save homeowners 10% to 40% on their heating and cooling bills every year.

These products are made by most major manufacturers and have the same features as standard products but also incorporate energy saving technology. Both R-22 and R-410A systems may have the Energy Star® label. Equipment that displays the Energy Star® label must have a minimum seasonal energy efficiency ratio (SEER). The higher the SEER specification, the more efficient the equipment. You should consider energy efficiency, along with performance, reliability, and cost, in making your decision.

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How Much is your Website Worth?

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Wed, 11 Aug 2010 20:56:01 -0400

I ran across this website not too long ago. I have not seen it before but have always figured there were sites like this out there.

Can anyone support the validity of these estimates?

This is a very cool site if the estimates are anywhere close to accurate.....

How much is your website worth?

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What You Want: Realestateandfunding.com

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Wed, 11 Aug 2010 19:50:16 -0400

Based on reports from many of my colleagues and associates this has already been a crazy week in the mortgage business and it may get even crazier. I am being told because Interest Rates are at previously unthinkable levels, Phones have been ringing off the hook. However consumers are still getting denied... from what I hear, value seems to be the biggest deal killer.

So as loan originators we forge ahead....

.....I have heard chatter that all the GSE's are considering loosening credit guidelines in an effort to stimulate home purchases and keep ailing home owners in their house. Rhonda Porter on her blog The Mortgage Porter has some interesting thoughts on underwriting guidelines - click here I share many of Rhonda's thoughts.

I believe there is a limited pool of eligible borrowers attempting to get financed in an era that has witnessed the toughest underwriting guidelines ever. The pool of eligible borrowers must be increased. One way to do that is to loosen credit guidelines. And for everyone out they shaking their head asking themselves if I am nuts, we need to bring back down payment assistance and no money down purchases.

As an industry, we have learned how to underwrite loans that will perform. Oh yes we have...

Keep in mind, many of the borrowers whose loans have defaulted are a direct result of today's economy. When you lose your job, it doesn't matter how much equity or how underwater your home is... If you can't pay you just can't pay.

Today's economy is brutal and many American consumers are falling victim to it... not by overspending or credit mismanagement but by economic influences beyond their control. These consumers are good borrowers who have always paid on time. We have to find a way to approve those borrowers and in turn they can buy homes and kick start this economy.

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Holding an Offer HOSTAGE for a Second Preapproval

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Mon, 02 Aug 2010 16:26:28 -0400

Via Celeste "SALLY" Cheeseman HAWAII Real Estate & Relocations (Century 21 Liberty Homes):

Many seller's agents are requesting for the buyer's to get preapproved with XYZ lender as a stipulation for submission with their offer. What if the buyer trusts their OWN mortgage broker or loan officer of choice?

In a situation where I've had a repeat customer who did choose their own loan officer and the seller's agent demanded a preapproval from the funding lender of their choice is when my clients became very leary.

The cons of ‘forcing' a buyer to get preapproved AGAIN:

They trust their own loan officer because they've used he/she before and did a great job. (AND..it was their choice so there is no conflict of interest)

They are getting leary as to why they HAVE to have another lender pull their credit ....again.

If the seller's agent has stated to use XYZ lender for a preapproval ...they really start getting leary.

They dump their loan officer and go with an unknown loan officer who promised them the world and doesn't perform.

There is nothing in writing to the buyer from the seller stating that they are requiring the buyer to run their credit again and get a preapproval from a funding lender.

The pros of having a buyer get preapproved AGAIN:

Shows the seller that they are qualified with a funding lender and no worries that the qualification IS worth the paper it is written on.

Gives the seller's agent some control over the situation in presenting a more solid offer to the seller.

If this stipulation is on the listing agreement and signed by the seller then it IS the seller's request and not the agent. (might as well go further and have the seller sign something to present to the buyer.)

The buyer's offer will be considered amongst multiple offers submitted for the same property.

There are times I've given my buyer's a list of loan officers I've worked with (especially relocating military who know no one here) and they speak to and choose which one they want to work with. But I do NOT choose a lender or loan officer FOR them!

In summary, my belief is that there is NO solid transactions until recording. There are always bumps in the road and other circumstances that buyer's will back out of a contract (i.e. home inspection, title issues, termites etc.) ........But HAVING TO get a SECOND preapproval letter with a XYZ lender after they have already gone through a complete credit and application process with their own loan officer is when I think that a demand for a statement signed by the seller requesting to do so may be a good option.

........for all involved.

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NACA Washington, DC - My thoughts....

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Mon, 02 Aug 2010 10:56:44 -0400

I attended the NACA workshop last week in Washington, DC along with about 50,000 other American consumers, many of whom drove in from all parts of the country. This event was attended by major lenders such as Citibank, Bank of America, Wells Fargo and other major lenders. Chase actually follows NACA around and hosts their own forums instead of attending the NACA workshop in person.

The workshop began with a counseling session that gives an overview of how the loan modification process is intended to work according to the Making Home Affordable and HAMP guidelines. Most NACA employees/volunteers were amazingly informed, pleasant and helpful in spite of the hours they are putting in. The workshop ran for a week, 24 hours a day. I often saw the head of NACA, Bruce Marks, wandering the floor and mingling with troubled consumers.

After the initial counselling session, and a wait for many of hours and hours because of the huge attendance, consumers met individually with a counselor either in person or on the phone. This meeting was to determine a budget of what the homeowner could afford and to determine if a loan modification made sense. NACA advisors made recommendations to consumers on spending habits and offered realistic suggestions on budgeting. Consumers were told that homeownership would have to take priority over luxuries such as boats, cars, credit cards and other non essential items. Many consumers were told that a modification could not be accomplished because they either made too much money or simply didn't have enough income to present a case to the bank. In the latter case, if income was due to job loss, NACA would attempt to help get a forbearance with the consumers lender. Regardless of why a consumer fell into financial difficulty there was no finger pointing. The mission was simple - to attempt to save American consumers homes.

In my opinion, NACA is a true grass roots organization with true intentions of saving American consumers homes from foreclosure. They have realistic goals for people who have suffered from predatory lending, job loss or are underwater.

My optimism of how NACA helps consumers began to turn to anger.

During the event, consumers were brought to the podium and spoke about how the attending lenders lowered their rates, granted forbearance and saved these homeowners money and their house. Why was that a cause for my anger you ask?

Simple... if it was not for the workshop where NACA brought lenders and consumers together, these homeowners would have lost their house. Period. Every consumer shared the same story ---lost paperwork, rude employees when contacting lenders which included threats and finger pointing, hold times that went on and on, bad advice from lender loan mod departments and broken promises.

As more and more consumers went to the podium and praised these lenders for helping as they shed tears of joy I just kept thinking to myself over and over... this is nothing but posturing by these lenders... Nothing more than a public relations ploy. Why were these consumers not helped before? Why did they have to drive for hours to attend this workshop, sleep in the chairs overnight and go thru unnecessary stress? What about the millions of American consumers that don't know about NACA or who couldn't attend the workshop who will lose their homes because lenders refuse to communicate?

Short Sale issues -

I visited the Fannie Mae table and met with their reps on two different days. I had one specific question. Why is Fannie Mae not policing the actions of the loan servicers of their product. After all, these lenders don't really own the loan, Fannie Mae does. I got nothing but blank looks, shrugged shoulders and weak attempts from these reps to defend their actions.

I asked them this question. What is the difference between a short sale, a foreclosure and a strategic default in the eyes of Fannie Mae? I told them I understood that Fannie intends to pursue any deficiency balance from a strategic defaulter and that their guidelines have been changed to a minimum of 7 years to be eligible for a new loan after strategically defaulting. FHA has adopted this rule as well....

So I asked this question... If a consumer attempts a loan modification from a servicer and gets turned down because of whatever reason (whether the consumer really doesn't qualify or the servicer flat out has no clue on the programs or how to calculate income or whatever), how do they determine the difference between a foreclosure and a strategic default? Again, blank smiles and shrugged shoulders.

So I asked one more question... If a servicer refuses to work with a consumer and their REALTOR® on a short sale, if they fail to communicate with the REALTOR® after a contract has been submitted, if they demand the consumer sign a new note regarding any deficiency balance or if they just conduct themselves in the typical unreasonable manner in which consumers and REALTORS® have become accustomed to and the house is abandoned by the home owner, how do they determine the difference between a foreclosure and a strategic default? Again, more blank stares and shrugged shoulders. Want to know why? Because they understood my questions and had no answer and they knew that Fannie Mae was not helping consumers and most of all, they were not playing their role in ending this economic crisis.

I asked one more question. Let's assume they sell a home at short sale for 100K less than the balance owned. Now let's look at the other alternative that is so typical these days. The current loan servicer refuses to communicate with a REALTOR® regarding a short sale, the home gets foreclosed on and sells at auction for 150K less than a short sale could have brought. Who wins then? Who at Fannie Mae or at these lenders is in charge of making such horrible business decisions and most importantly, is the American consumer paying for this?

Strap on your seat belts people...

this is how I see it in a nutshell - Real Estate led our country into this financial disaster and it is going to have to be real estate that leads us out. We have a limited pool of eligible borrowers that qualify for loans. As more of these eligible borrowers who seek relief from the government because they are underwater choose to strategically default as they discover they can rent the same house for half the price and decide their credit is a non issue for the next seven years and as the pool of first time home owners shrinks and as eligible move up borrowers can't sell their house because banks refuse to work a short sale and as underwriting guidelines continue to get more difficult.... well this will cause home values to continue to decline... in fact, it already is and will continue the same trend... I believe this country may be headed towards the biggest financial crisis the world has ever seen....

I do not endorse NACA but I have seen with my own eyes how this group can help struggling home owners. Make your own decision....You can read NACA success stories by clicking here.

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Understanding Short Sale Transactions | A Guide to Short Sale Facts & Myths

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Thu, 29 Jul 2010 20:29:14 -0400

Via Bill Gassett Metrowest Massachusetts Real Estate (RE/MAX Executive Realty):

Understanding Short Sale Transactions | A Guide to Short Sale Facts & Myths

A short sale unfortunately has become a common buzz word in the Real Estate industry. For those that have been hearing the term "short sale" and don't quite understand what it means, a short sale is a legal lender approved solution designed to assist a home owners who is financially strapped to get out from under their mortgage debt.

A short sale is negotiated through the mortgage holder of an owners home where by the mortgage holder agrees to take less than what home owner owes on the property.

A quick example of a short sale would be if a home owner owes $400,000 on their current mortgage and their home is only worth $350,000. The lender in this example would agree to take a short fall of $50,000 at closing.

In some cases the mortgage holder may completely wipe out the debt and the home owner does not have to repay the 50,000. Many lenders may require a seller to sign a note and repay the debt over a certain amount of time. Typically the debt will be reduced and the owner may receive favorable repayment terms of the short fall.

There is quite a bit to know about short sales from both a buyer's and seller's perspective. I have been successfully been completing Massachusetts short sales over the last three years. In fact (knock on wood) I have never had a short sale that did not get approved! Successfully completing a short sale is about understanding the process.

Many consumers make extremely poor choices by working with Real Estate agents that don’t have a lick of experience with getting short sales approved. Picking a good short sale Realtor is critical to your success.

The following is a number of specific topics about short sale transactions that you would want to be aware of if you are planning to either buy or sell one of these types of distressed properties.

Stop making mortgage payments during a short sale? ~ Whether or not a home owner should continue to make mortgage payments is a common question that many sellers want to know when considering a short sale. The most common answer to this question is YES, however it really depends on the lender! Click the link to understand all the considerations.

Picking the right short sale Realtor ~ Picking a Realtor to work with in a short sale is very different than a traditional transaction. You want to work with an agent that has experience successfully closing this type of transaction. Remember as a seller you could potentially be facing a foreclosure. There are many mistakes that are made by agents handling short sales. Don't get caught with your pants down!

Questions to ask a short sale listing agent ~ If you are thinking about buying a short sale there are some specific questions you can ask the listing agent to determine the probability that the short sale will be approved or not. These short sale questions will also help determine if the Realtor handling the short sale knows what they are doing!

Acceptable hardships for a short sale ~ On many occasions when doing a short sale the lender is going to require some kind of hardship on the part of the seller. Short sale hardships however, have become less rigid recently and some lenders are becoming more concerned strictkly on whether the short sale would benefit them more than a foreclosure sale.

Short sale tax consequences ~ Understanding the tax consequences in a short sale is one of the most important considerations for a home seller. Whether the short sale home was a primary residence or an investment property can have different tax implications.

Getting short sale debt released ~ Getting the debt released on a short sale is obviously a very big deal. Many Realtors that are working with short sales don't have any knowledge of how to get the debt released. A seller needs to pay particular attention to this detail as you can expect to be hearing from a collection agency without it!

When to do a short sale home inspection ~ This topic is important to understand from both a buyer's and seller's perspective. A home inspection should be done before short sale approval and NOT after. Read the article to understand why it benefits both the buyer and seller to do so.

Strategic default vs short sale ~ There are many home owners who are deciding just to walk away from their homes. Fannie Mae has started to crack down on this practice and is now penalizing borrowers from getting a mortgage for up to seven years! A perfect alternative to a strategic default is a short sale.

These articles were published on my Massachusetts Real Estate blog where I talk about numerous topics that are important to consumers who may be thinking about buying or selling Real Estate.

I am successfully completing short sales through out the Metrowest Massachusetts area. So far, knock on wood, I have a 100% success rate for short sale approval! If you need to complete a Massachusetts short sale please feel free to get in touch.

If you are outside of the Metrowest Massachusetts area and need to do a short sale please give me a call or email and I would be happy to refer you to a Realtor in your location that handles short sales and knows what they are doing! I have referred short sales to other Realtors all around the country.

___________________________________________________________________________________________________

About the Author: The above Real Estate information on understanding short sale transactions was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356.

Have a home to sell in Metrowest Mass? I have a passion for Real Estate and love to share my marketing expertise!

For Metrowest Massachusetts Real Estate and homes see Massachusetts Real Estate. Want to have MLS access to beat other buyers to your dream home? Sign up with no obligation at my MLS Property Finder Site.

I service short sales in the following towns in and around Metrowest Massachusetts: Hopkinton, Milford, Upton, Southboro, Westboro, Ashland, Holliston, Mendon, Northboro, Shrewsbury, Hopedale, Medway, Grafton, Northbridge, Uxbridge, Franklin, Framingham and Douglas MA.

Click here to view Bill Gassett's Real Estate profile.

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House of Cards... amazing report on how the mortgage market went nuts

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Thu, 29 Jul 2010 00:45:34 -0400

If your in financial trouble we can help... No Income Needed.... you dont even need a job!

CNBC presents the defining story of our time. Correspondent David Faber investigates the origins of the global economic crisis and the events leading to the most devastating financial collapse since the Great Depression.

This video may make you mad, may make you sick, may say I told you so, may even make you cry.... when you gather all the information from this video you have to scratch your head and wonder are we even close to the bottom yet?

Simply amazing.... and you know what... if you were a Mortgage Broker, a Banker, an Appraiser, a Title company, a REALTOR®, a Wall Street broker or anything Real Estate related whether directly or indirectly, you had something to do with this...

Controversial? you bet... Makes me sick I was in the industry at the time WATCH THIS VIDEO

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Think Loan Modification is being Policed by the Gov't? You gotta watch this.

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Wed, 28 Jul 2010 18:17:53 -0400

I just found this video of Barney Frank (of all people) addressing a Chase executive regarding home loan modifications. You just have to see this video to believe it....

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You are more influential than you think

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Wed, 28 Jul 2010 08:43:37 -0400

Fast Company is searching for 2010's Most Influential Person Online. You are more influential than you think. How influential are YOU? Check out Fast Company's "Influence Project" -

http://fcinf.com/v/b8xq

Fast Company magazine is searching for people who are influential online. Discover how influential YOU are. Find out how influential other people are by visiting The Influence Project at: http://fcinf.com/v/b8xq

After clicking on http://fcinf.com/v/b8xq you can join the project and share with your Linkedin Network, Facebook friends, Twitter followers, fans or group members.

If you are in Real Estate, Mortgage Banking, marketing, public relations or sales, you will find the project's visual description of your influence to be very interesting!

Your influence

Spread your influence!

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Don't Screw Up Your Loan With Untraceable Deposits

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Sun, 25 Jul 2010 11:01:04 -0400

Via Sally Dunbar Fair Oaks Homes for Sale (Lyon Real Estate, Fair Oaks ('burb of Sacramento) CA):

Dang! It just happened again! My buyer's daughter transferred $20K into their account, because they're really buying the condo for the daughter with her money. (The daughter has bad credit, but a wad of money, so Mom and Dad are making the purchase for her).

Now we need to show proof of where the money came from - which means copies of the original check, copies of the cashed check, copies of her birth certificate, marriage license, and dog's vaccination. OK... I jest about the last 3, but DON'T MAKE DEPOSITS WITHOUT SPEAKING TO YOUR LENDER ABOUT THE CONSEQUENCES TO YOUR LOAN. Federal guidelines mandate we need a paper trail for every cent of money that goes through your bank account.

Getting these verifications take time... time that can throw a serious wrench into your loan process. So while it may not be a problem getting down payment assistance from elsewhere, the timing of it causes the real problem.

So what do you do, if someone else is giving you money for your down payment?

1. Be sure your lender approves the amount.

2. Provide a gift letter, promising to put up the money as a gift.

3. Get a cashiers check written directly to the title company.

4. Wait until you have loan approval, and have signed your loan documents.

5. THEN deposit your cashier's check directly into the title company. (check with your local customs, as not all states handle title and escrow the way we do here in Fair Oaks). having the gift money going directly into the title company means only one paper trail... from the gifter to the title coompany. But if it first goes to the person buying the house, there is an extra layer of paper trail involved, which takes more time.

You do this, and you will avoid a bundle of paperwork that can drive you crazy. Just make sure you have run this by your lender... then do as they say!

OR... go buy a lottery ticket tonight, then pay cash!

_______________________________________________________________________________________________

For homes in the Fair Oaks or Sacramento Area of California.... I'm your gal. I'm occasionally knowledgable, periodically humorous, and always willing to tell you everything I know. What more could you ask for?

For more blog posts.... click here

My website, for homes in Fair Oaks, Sacramento and vicinity - CLICK HERE

To search Homes in Old Town Fair Oaks - CLICK HERE
For homes in the Northridge area of Fair Oaks - CLICK HERE
For homes in Rollingwood of Fair Oaks - CLICK HERE

For Sacramento foreclosures, click here

Sally Dunbar, 30 year Broker Associate, Lyon Real Estate, Fair Oaks, (916) 535-0356, SDunbar@GoLyon.com

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I have a dilemma...How much is too much?

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Mon, 19 Jul 2010 09:46:55 -0400

I had a client call me this weekend who wants to pull some cash from her house. The typical loan officer here in Annapolis, Maryland would be happy with this call as she has 700+ credit scores and plenty of equity left. But as I started a new file in my loan origination system I became confused.

Confused you ask? Well yes.... you see I have done two other cash out refinances for her in the past three years and I don't like the pattern I am seeing.

So I have a dilemma... refinance her and eat up yet more equity from a client who is just a few years away from retirement or tell her no and risk losing the deal to another lender who may not be as compassionate as I am.

My client told me she wants the cash to use as a down payment for a condo at the ocean where she plans on retiring. I advised her this morning to contact a REALTOR® and get a honest value of what she could expect to sell her property for and how long it would take to sell it. I recommended she sell her house first and use the cash for a down payment and most important of all only have one mortgage payment.

It's tough to pass on a deal these days but I feel food about the advice I handed out...

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Get out your permanent markers, HUD seeks public comment on three main issues for FHA loans

Lewis Poretz - Mortgage Advice - Annapolis, Maryland — Sat, 17 Jul 2010 12:49:27 -0400

Via Jeff Belonger -- The FHA Expert.com -- FHA Loans -- FHA mortgages - USDA loans (Infinity Home Mortgage Company, Inc):

You can make a difference - you have 30 days to comment against FHA's proposals

With a difficult economy and possibly some new FHA mortgage changes coming in the new future, this could be time to make your voice heard. HUD made this announce back in January 20th, 2010 - FHA announces policy changes to address risk and strengthen finances - I parlayed this announcement into layman's terms. - FHA loans and some possible mortgage changes.

So now, FHA just announced that there will be a 30 day period for comments on these issues described above. These proposals are designed to limit the risk in regards to the Mutual Mortgage Insurance Fund and at the same time, trying to promote sustainable homeownership for FHA borrowers.

The 3 possible changes to FHA Loans :

1. Changing the combination of credit scores and downpayments. You will need a credit score of 580 or above to still be eligible for the regular 3.5% downpayment. If below 580, you will be required to put 10% down. And FHA loans will not allow any loans with credit scores below 500.

My opinion : I am not concerned with this proposal. Most lenders require credit scores of 620 or higher on FHA loans. I wrote about it here. - FHA home loans have no minimum credit scores - So FHA, you can have this one.

2. The reduction of seller concessions from 6% to 3%. Many of us know that this could have a huge impact on many different housing markets.

My opinion : I truly think this could affect those buying homes from $150,000 and below. Especially those homes prices at $100,000 and below. That would mean on a $100,000 home, the buyer could only get $3,000 of help towards closing costs. - FHA, since I gave you #1, I want #2, and keep it at 6%. Update... keep this in mind - If a borrower has to come up with more money now, what does that do to their cash reserves in many cases. In troubled times, does this mean that they will default quicker now?

3. To tighten FHA underwriting standards for manually underwritten loans. FHA's purpose would be when using compensating factors while underwriting, lenders will be required to consider those factors which would be best predictive indicators of the performance of the loan.

My opinion : I guess I would have to wait for a better explanation letter in the mortgagee letter, if this is approved. You already are required top have compensating factors when manually underwriting a FHA loan, making sure that the loan will perform. I just think this is FHA's way of saying that they want underwriters to be more critical when approving a loan and to have more solid compensating factors. Ex. Instead of making sure that your borrower had 2 months in reserves (money left over after closing to cover 2 mortgage payments), that they would like to see 6 months. Who really knows on this one. Could be more political chit chat.

Conclusion : As I mentioned above, I am not worried about numbers 1 and 3. But number 2 could have an impact on the housing market in many areas. On the positive side of things, HUD could have increased the down payment to 5%. This was talked about in congress several times, but shot down. Talk of FHA loans raising the down payment to 5%. - Here is the argument about why some want more money down. The FHA argument - I want more skin in the game.

Where and how to comment :

Regulations.gov - (main site) please to search for government proposals.I give the specific page below, where to comment.

Here is the link to the different proposals and FHA's reasoning's for such proposals. Federal Register for HUD changes and the reasons why. If you go to the middle of the first page, you will see how they explain the different ways to comment. They highly suggest doing it electronically, which I mention below.

CALL to ACTION : Send this to other agents and loan officers. Don't hesitate to reblog this, to get the message out.

Here is the actual page to go and make your comments - Comments for reduction of seller concessions and new loan to value with credit scores - Click submit a comment which is on the right side of this page, in blue.

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For more information on FHA loans, please go to this link. The FHA Expert

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

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Copyright © 2010 by Jeff Belonger of Infinity Home Mortgage Company, Inc

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