Daily Real Estate News | Tuesday, February 25, 2014
Now that the worst of the foreclosure crisis is in the rearview mirror, former home owners who lost their homes to a short sale or foreclosure are re-entering the housing market. They've spent the last few years rebuilding their credit — and they're ready to buy again.
"We're about three years past the peak of the foreclosures, and that's about the time when most people would qualify for another loan," says Daren Blomquist, spokesman for RealtyTrac. "The market really needs boomerang buyers to maintain the current recovery."
Some boomerang buyers heading back to the housing market may find they have to make down payments of at least 20 percent to qualify for a loan, but others are finding opportunities to put down as little as 3.5 percent or 5 percent.
The wait times for qualifying for a loan can vary depending on the former home owners' circumstances. Typically, the wait times following a short sale or foreclosure are as follows:
• Seven-year wait for home owners with a previous foreclosure before they can qualify for a new mortgage through mortgage giants Fannie Mae and Freddie Mac. If the foreclosure was included in a bankruptcy, the borrower has to wait only four years.
• Two-year wait for home owners who underwent a short sale before they're eligible for another Freddie Mac and Fannie Mae loan.
• Three-year wait for home owners seeking a Federal Housing Administration loan after a foreclosure or short sale. Some home owners who underwent a foreclosure because of at least a 20 percent cut in their pay may be able to qualify for a new mortgage after just a year through FHA's Back to Work program.
Source: "'Boomerang' Buyers Get Another Chance at Homeownership," Sun Sentinel (Feb. 24, 2014)
Tuesday, February 25, 2014
Thursday, February 13, 2014
New Home Owners Targeted In Deed Scam
Scammers are approaching new home owners and trying to trick them into paying $83 for unnecessary property records — including deeds that are available for a few bucks at county government offices or are already supplied at the end of a real estate transaction, the Milwaukee Sentinel Journal reports.
Fake companies reportedly are soliciting customers with a formal-looking letter that resembles a government bill. The companies are using multiple names for their business, such as Record Transfer Services, Property Transfer Services, Conveyance Transfer Services, Record Retrieval Department, and National Deed Service. They often use a similar phone number: 888-874-4669
In a recent case in Wisconsin, new home owners were asked for an $83 "document fee" for a deed and "real property records" by a certain deadline.
"Some people don't even call and ask the question," says Sherieda Wilder, a records clerk with the Milwaukee County register of deeds office. "They just automatically send [the money]. They're just excited they get their house."
Graig Goldman, a real estate broker with RE/MAX Lakeside Realty in Milwaukee, first alerted the Sentinel about the scam after two of his clients approached him separately within two months of purchasing a house to ask why they had received another bill.
At the bottom of the letter was a disclaimer: "The company Record Transfer Services is not affiliated with the State of WI or the County Recorder. ... This offer serves as a solicitation for services and [is] not to be interpreted as a bill due."
"For people who don't understand the real estate process or that a deed exists, they think they have to pay this," says Cori Lamont, director of regulatory affairs with the Wisconsin REALTORS® Association.
Source: “Deed Scam Tricks New Home Owners into Buying Useless Documents,” Milwaukee Journal Sentinel (Feb. 12, 2014)
Fake companies reportedly are soliciting customers with a formal-looking letter that resembles a government bill. The companies are using multiple names for their business, such as Record Transfer Services, Property Transfer Services, Conveyance Transfer Services, Record Retrieval Department, and National Deed Service. They often use a similar phone number: 888-874-4669
In a recent case in Wisconsin, new home owners were asked for an $83 "document fee" for a deed and "real property records" by a certain deadline.
"Some people don't even call and ask the question," says Sherieda Wilder, a records clerk with the Milwaukee County register of deeds office. "They just automatically send [the money]. They're just excited they get their house."
Graig Goldman, a real estate broker with RE/MAX Lakeside Realty in Milwaukee, first alerted the Sentinel about the scam after two of his clients approached him separately within two months of purchasing a house to ask why they had received another bill.
At the bottom of the letter was a disclaimer: "The company Record Transfer Services is not affiliated with the State of WI or the County Recorder. ... This offer serves as a solicitation for services and [is] not to be interpreted as a bill due."
"For people who don't understand the real estate process or that a deed exists, they think they have to pay this," says Cori Lamont, director of regulatory affairs with the Wisconsin REALTORS® Association.
Source: “Deed Scam Tricks New Home Owners into Buying Useless Documents,” Milwaukee Journal Sentinel (Feb. 12, 2014)
Friday, February 7, 2014
Prior Short Sellers: Watch for Credit Errors
Those who have undergone a previous short sale need to pay careful attention to their credit report to make sure it was reported accurately by the lender, especially if they want to apply for a new mortgage anytime soon. The short sale may erroneously appear on their credit report as a foreclosure, a blemish that could haunt them much longer and prevent them from obtaining a new mortgage because it’s a red flag to a lender.
Typically, when lenders report on a short sale, they’ll say, “settled for less than full balance.” That’s a key indicator for a buyer's new mortgage lender to see because it shows that the previous property was a short sale, not a foreclosure, according to Credit.com. Lenders have the responsibility to report accurately to the credit bureaus.
Credit.com says these credit report codes will also hamper a borrowers’ ability to qualify for a mortgage any time soon: Chapter 5, 8, or 9 – which are often synonymous with a foreclosure.
A short sale borrower is eligible for conventional loan financing 24 months after a short sale at 80 percent loan-to-value or lower. If it’s a foreclosure, however, they may have to wait up to seven years to qualify for a conventional loan, or four years if they can prove it was a one-time economic hardship situation that caused the foreclosure.
Borrowers who have the short sale inaccurately noted in their credit report will need to contact the creditor and likely supply a final settlement statement showing the previous property was a short sale, and a copy of the grant deed transferring the property from them to the buyer.
Source: “Credit Report Error Sinks Short-Sellers Bids for a Mortgage,” Credit.com (Feb. 6, 2014)
Typically, when lenders report on a short sale, they’ll say, “settled for less than full balance.” That’s a key indicator for a buyer's new mortgage lender to see because it shows that the previous property was a short sale, not a foreclosure, according to Credit.com. Lenders have the responsibility to report accurately to the credit bureaus.
Credit.com says these credit report codes will also hamper a borrowers’ ability to qualify for a mortgage any time soon: Chapter 5, 8, or 9 – which are often synonymous with a foreclosure.
A short sale borrower is eligible for conventional loan financing 24 months after a short sale at 80 percent loan-to-value or lower. If it’s a foreclosure, however, they may have to wait up to seven years to qualify for a conventional loan, or four years if they can prove it was a one-time economic hardship situation that caused the foreclosure.
Borrowers who have the short sale inaccurately noted in their credit report will need to contact the creditor and likely supply a final settlement statement showing the previous property was a short sale, and a copy of the grant deed transferring the property from them to the buyer.
Source: “Credit Report Error Sinks Short-Sellers Bids for a Mortgage,” Credit.com (Feb. 6, 2014)
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