Archive for June, 2010

Avoiding Foreclosure

June 28, 2010

House in Hands, avoiding foreclosure, foreclosure tips, short sale, deed in lieuIf you are having difficulty making your mortgage payments because you have lost a job, had a reduction in income or had an increase in your payments, foreclosure may be avoided. Here are some steps to take:

1. Don’t ignore the problem. The further behind you become, the harder it will be to reinstate your loan and the more likely that you will lose your house.

2. Contact your lender as soon as you realize that you have a problem. Lenders do not want your house. They have options to help borrowers through difficult financial times.

3. Open and respond to all mail from your lender. The first notices you receive will offer good information about foreclosure prevention options that can help you weather financial problems. Later mail may include important notices of pending legal action.  Your failure to open the mail will not be an excuse in foreclosure court.

4. Avoid foreclosure prevention companies. You don’t need to pay fees for foreclosure prevention help–use that money to pay the mortgage instead. Many for-profit companies will contact you promising to negotiate with your lender. While these may be legitimate businesses, they will charge you a hefty fee (often two or three month’s mortgage payment) for information and services your lender and a trained real estate professional will provide free.

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Will the Tax Credit Closing Deadline be Extended?

June 18, 2010

Many homebuyers who went under contract prior to the April 30th tax credit deadline, but still haven’t managed to close, may be starting to sweat as the June 30th closing deadline approaches.  In fact, according to the National Association of Realtors (NAR), as many as 180,000 homebuyers who signed contracts in time will not be able to make the June 30 closing deadline. Approximately 75,000 of those are buyers of distressed properties.

It looks like they might get a little extra help from Uncle Sam.

After strong urging from NAR, the Senate approved adding the amendment to a proposed jobs bill on Wednesday to extend the closing deadline on the tax credit of up to $8,000 for home buyers. Under the measure, buyers would have until Sept. 30 to close on sales that went under contract by April 30.

The extra time would, of course, only apply to buyers who met the original April 30th sales contract deadline…if the bill passes.

“All [the measure] does is take the existing law and scratch out June 30 and put in Sept. 30,” says Lucien Salvant, a spokesman for NAR.

The measure was introduced by Nevada Democrat Harry Reid, Georgia Republican Johnny Isakson, and Connecticut Democrat Chris Dodd. The extension measure is part of a wide-ranging bill of tax policy extensions and federal program renewals.

The Senate will likely vote on the larger measure later this week or next week, and then it heads to the House.  Stay tuned…we’ll be following developments on the status of the bill.

RISK: A 4-Letter Word for Mortgages

June 14, 2010

The current economic climate we find ourselves in could easily be titled, “The Good, The Bad and the Ugly”, “The Best of Times and the Worst of Times” or even, “I have good news and I have bad news”

I’m a very strong believer that if you know what to expect and have an understanding of possible challenges and plan for them and anticipate them, bad news or challenges can be overcome.

Well, here’s the GOOD News:

• Interest rates are at 50 year lows.
• Home prices are at 10 year lows in some markets.
• It’s a buyer’s market.
• FHA HUD homes can be bought with $100 down.
• There are a large number of homes to choose from.
• Etc., Etc.

Some have grown complacent to all this good news. Some even thought there was better news coming and missed the only Federal Homebuyer Tax Credit in History!

Well, here’s the BAD News:

• The low interest rates mean that Lenders have more to lose than gain by making loans!
• These lenders have already lost large sums due to unpaid mortgage loans that have resulted in the drop in home prices.
• Risk rules the Lending world today, making getting a new mortgage a very difficult and long process.

So, be prepared for the reality of the new lending requirements. It’s definitely worth it when you consider what they have to gain.

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How Was Your Customer Service Experience?

June 7, 2010

I am of a “certain age” and have noticed that I’ve become increasingly aware of really good and really bad customer service.  When I experience great customer service, I make a point of thanking the provider for the service.  To my son’s everlasting embarrassment, though, I have also been vocal to some bad service providers.

My most memorable recent “bad” customer service experience was at a big-box store in which my husband and I were opening a store account to purchase several thousand dollars worth of floor covering.  The clerk handed me a credit application printed in Spanish only.  Now I majored in French literature some decades ago in college and have parlayed my understanding of that language into Spanish from time-to-time, but I wasn’t certain that my “fluency” would suffice for a credit application.

I asked the clerk for an application printed in English.  He told me I could go to the other end of the aircraft-hanger sized store to ask for one.  Silence.  Eye contact.

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Greek Tragedy Helps U.S. Mortgage Rates

June 1, 2010

The current financial troubles in Europe are proving to be an unexpected blessing for U.S. homebuyers. With the value of the Euro steadily declining, large international investors are now putting their money into U.S. Treasury Bonds. The value of these bonds has a direct impact on mortgage interest rates. When the value of U.S. Treasury Bonds go up, mortgage interest rates go down.

The increased demand and buying of U.S. Treasury Bonds has forced their value up which in turn has allowed mortgage interest rates to drop to a new 50 year low.

So what does that mean for homebuyers and homeowners? That this is an EXCELLENT time to buy or refinance!

These low rates coupled with incredible home prices allows a homebuyer to literally own a home that was far beyond their reach 3 years ago, for less per month than they pay in rent. In real dollars and cents, a $150K, 30-year loan at 5% is a principal and interest payment of $805 per month.

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