Team Nadine’s Blog

Homeowners in jeopardy of foreclosure have new hope! In an effort to prevent foreclosure and encourage lenders to help facilitate alternatives to foreclosure a new program has just been released. On November 30, 2009, the Treasury Department released guidelines and forms for its new Home Affordable Foreclosure Alternatives Program (HAFA). HAFA provides incentives in connection with a short sale or a deed-in-lieu of foreclosure  used to avoid foreclosure on a loan eligible for modification under the HAMP program. Servicers participating in HAMP are also required to comply with HAFA. To learn more about this program and to see if you qualify follow this link:

MakingHomeAffordable.gov.

Believe it or not there are substantial benefits to having your home on the market during the holidays.  Many people are bogged down with holiday preparations, parties and other festivities.  Having their home on the market is just one more stressor to cope with during this festive time of year.  So frequently homeowners consider taking their home off the market during this time of year.  In today’s challenging market homeowners need every advantage possible to get their homes sold.  Keeping your home on the market during the holidays has many advantages home sellers need to consider:

· Holidays afford much more time off for families to look at homes together.  Buyers need not take extra time off to shop for a home and like to take advantage of holiday paid time off to shop.  This is very important in this economic environment  Also serious buyers who are ready to purchase like to have the the whole family’s approval of the area and home prior to making a final decision.  Most parents do not like taking children out of school to facilitate their participation in the final decision making process.  Although buyer activity may appear to slow down, the buyers who are actively looking during the holidays are that much more serious. Wouldn’t you rather prepare your home for a serious buyer rather than a casual looker? Many agents believe the home market is no more affected at Christmas than during other “busy” periods. This is especially true here at Lake Norman where most Realtors agree our 4th quarter was markedly better than this summer! 

· Many buyers deliberately choose to shop for a home after the busy spring and summer rush.  Here at Lake Norman the ideal time to shop for a waterfront home is in the winter months when the lake is at it’s lowest levels and easier to spot the depth of shoreline water levels which is very important to discriminating waterfront shoppers. 

 · Companies relocate their employees all year long.  Studies show that 68% of families with children actually prefer to relocate mid-year to facilitate their children’s quick socialization at school to make friends easily and become involved with local sports teams quickly rather than having to wait all summer for new friends to be found at school in the fall.  A spring break move is ideal to accomplish this task…but that means writing a contract on Christmas break!  Especially important now with lending time frames necessary to process loans.

 · Most home owners would agree that their homes are most warm and inviting during the holidays.  What better time is there to take advantage of the beautiful holiday decor, setting the stage for the perfect stage to show your home?  Those potential buyers will enjoy feeling your homes most warm and inviting atmosphere.  Savvy sellers are smart to capitalize on that marketing advantage!  

Looking for a sign that recovery is on it’s way?  Everyone’s been waiting for indications that markets truly are starting to stabilize.   According to the Standard & Poor’s Case-Shiller Home Price Index such signs are clearly starting to surface. 

To learn more follow this link:

http://www.prnewswire.com/news-releases/broad-improvement-in-home-prices-according-to-the-spcase-shiller-home-price-indices-62574707.html

Wow…signs of life in the new housing market!  We are finally starting to see inventory of new homes begin to dwindle in the Lake Norman area and nationwide.  A positive sign that recovery is truly on it’s way.  For myself the recent weeks have brought a flurry of activity with multiple buyers in this past weekend and many requests for Lake Norman information.  I haven’t seen this much activity in a year and a half.  Here is a link to view an article that confirms the nationwide trend of new housing starts on the increase:

http://www.nytimes.com/2009/09/18/business/economy/18econ.html?_r=2&adxnnl=1&ref=business&adxnnlx=1253193526-iORDSd+/1uzt1UFhjmFHzw

Everyone is asking who is likely to benefit from the recently released by the Treasury Department. Some program highlights include:

*The mortgage to be modified must have been originated on or before January 1, 2009. 

 *New borrowers will be accepted until December 31, 2012. Program payments will be made for up to five years after the date of entry into a Home Affordable Modification. Monitoring will continue through the life of the program. 

*The home must be an owner occupied, single family 1-4 unit property (including condominium, cooperative, and manufactured home affixed to a foundation and treated as real property under state law).

 • The home must be a primary residence (verified with tax return, credit report, and other documentation such as a utility bill).

 • The home may not be investor-owned.

• The home may not be vacant or condemned.

• Borrowers in bankruptcy are not automatically eliminated from consideration for a modification. • Borrowers in active litigation regarding the mortgage loan can qualify for a modification without waiving their legal rights.

• First lien loans must have an unpaid principal balance (prior to capitalization of arrearages) equal to or less than: o 1 Unit: $729,750 o 2 Units: $934,200 o 3 Units: $1,129,250 o 4 Units: $1,403,400

*Any foreclosure action will be temporarily suspended during the trial period, or while borrowers are considered for alternative foreclosure prevention options. In the event that the Home Affordable Modification or alternative foreclosure prevention options fail, the foreclosure action may be resumed.

For more details of this new program please follow this link:

Home Affordable Modification Program Guidelines.

Some additional things to consider:

*Not all lenders are required to participate in this program.  Your current lender might have new programs and options to abide by the new government law and is worth investigating.  Keep in mind the huge volume of consumers that are making inquiries into refinancing at this time.  Patience and understanding of these facts will help you deal with delays in response time.

*These guidelines are simply outlines of the rules of this new law and will vary with each individual situation.

*Seek out someone who deals in lending every day to discuss your options given this new program and your personal situation.

*If you are late for your mortgage payment it is worth investigating.  Sometimes you wont know if you qualify unless you go through the application process.

Hope for homeowners in jeopardy of foreclosure is getting better every day.  Here is a very comprehensive list organizations that offer free or low cost foreclosure prevention programs;

House Harmony Investments, LLC~ Charlotte based. They specialize in Preforeclosures and short sales. www.MYHouseHarmony.com 704-332-HELP Househarmony@carolina.rr.com

Hope for Homeowners may refinance mortgages for borrowers that are having difficulty making their payments, but can afford a new loan insured by the Federal Housing Administration 1-800-225-5342 www.hud.gov/hopeforhomeowners

Hope Now is an alliance-between counselors, servicers, investors, and others.They provide borrowers with debt management counseling, credit counseling and overall foreclosure counseling.  The goal is to help home owners stay in their homes. 1-888-995-HOPE www.hopehow.com

NeighborWorks is a national network of more than 240 community-based nonprofit organizations created by Congress to provide financial support, technical assistance and training for community revitalization efforts.  1-202-220-2300 www.nw.org

US Department of Housing and Urban Development Thanks to one of my readers who has shared this tip: homeowners with FHA loans or any loans for that matter can contact HUD for a free consultation.  Also available is a Guide To Avoiding Foreclosure: call 1-800-569-4287 www.hud.gov/foreclosure/index.cfm

NC Department of Health and Human Services Low Income Home Energy Assistance Program~ There are some forms of assistance available to low income households through State programs.  The include financial assistance towards a household’s energy bill, emergency assistance if a household’s energy service is shut off or about to be shut off, and a range of other energy related services such as weatherization improvements, utility equipment repair and replacement, budget counseling and so forth 1-800-662-7030 www.ncdhhs.gov/dss/energy

If you or someone you care about are currently experiencing some sort of financial distress that might jeopardize your ability to make mortgage payments there are several crucial bits of information you need to know and some things you need to do right now before your payment is late. There are many people currently in this situation due to loss of job or a decreased income, mounting credit card debt, an increase in mortgage payments (due to an increase in an adjustable rate mortgage), a serious illness, or divorce.  These are depressing situations that might cause one to avoid dealing with the serious situation at hand, just give up and let the bank foreclose on their home, or perhaps someone might be too embarrassed to reach out for help to investigate their options.  There are options and alternatives to foreclosure!  Foreclosure hurts many people besides the person being foreclosed. Like a contagious disease that begins to spread it effects the entire neighborhood.  It hurts all homeowners that surround this home causing properties values to decrease.  When a home is put onto the market it is extremely difficult to compete with the short sale or foreclosure down the street causing that home to need to lower their list price to have even a remote chance to compete for a sale.  Eventually causing comps to fall and home values within this surrounding area to depreciate.  Believe it or not lenders would rather not foreclose on properties.  It is more lucrative for lenders to work out as the foreclosure process can be an expensive process for the lender.  BUT…once a borrower defaults on the loan the mortgage servicer is no longer collecting their monthly fees and therefore would rather forclose to rid itself of the obligation to service that loan.  For that reason it is critial that you contact your lender before a payment is ever late or missed!!!!

Here are things you can do that will help your situation:

First and foremost if you are beginning to experience financial difficulties anticipate financial problems you need to communicate with the mortgage lender before a mortgage payment is late.   Communication is crucial.  Another critical this to avoid is abandoning the property.  The lender will interpret that action as an indication that you are not willing to attempt to work out a loan modification and will just foreclose. 

Get professional guidance:  FREE help is out there to guide you through the process of evaluating your personal situation.  There is an 800# to call for Government approved counselors to assist you at this point and to review your case to see if there are any alternatives for you at this point. 1-888-995 HOPE or website www.HOPENOW.com   This program provides 24 hour a day-seven days a week free counselling or to be directed to a HUD approved counseling agency.  Or check out the HUD website www.hud.gov and follow the various links to find offices within North Carolina. 

 The options rather than foreclosure are:

1. Forbearance by the Lender~  This is most feasible if you have experienced a temporary financial hardship due to illness, or job loss with a reasonable expectation that you will be able to find a new job with an income level high enough to make your mortgage payment.  If you can provide proof and documentation of a temporary hardship the lender may agree to delay or alter collection efforts.  They may agree to allow the borrower to pay only a portion of your scheduled payment or perhaps no payments for a very specific period of time.  The amounts that are unpaid are not excused but rather will be addressed by an new loan modification or extension plan from your original loan.

2. Repayment plans~If a borrower has missed a payment… but now has the financial ability to make full payments the lender may be willing to alter your current payment structure to include the past-due amount.
3. Loan Modifications~ If you are behind several months of mortgage payments due to financial hardship and you have the ability now to resume payments the lender may agree to modify the terms of the original loan. Sometimes they even forgive payments for up to 1 year for those who have experience hardship due to a natural disaster.  Loan modification may be the best solution for those who have an adjustable rate mortgage which they are not able to afford currently but who can qualify for a fixed rate mortgage at a slightly higher rate than initially enticed them to choose an adjustable rate option.
4. Short sale~ When the above two options are not an option the lender may agree to accept less than what is owed on your home if you present full evidence that diligent efforts have been employed to try to sell your home to recoup full value of the mortgage amount.  Due to the recent depreciation of homes the value or your current mortgage might exceed the current market value.  In this case a homeowner cannot lower the price of the home to a level that is currently selling.  Another new option for those home owner’s homes are now worth less than the current mortgage owed  is the new bill put into law in October known as the Home Owner Recovery Act of 2008. This new law allows for qualified home owners with their lenders permission to refinance their home at 90% of the homes newly appraised value. One catch though…the government will then share in the property’s appreciation.  Follow the blue link for complete details.  

5. Deed -in-lieu of foreclosure~ Is when the home owner voluntarily agrees to give up title on their home to the mortgage company to satisfy the mortgage debt. 

6. Partial Claim~In this situation an insurer agrees to provide funds to the borrower to satisfy any deficiency in mortgage payment to bring the account current.  There are three sources to provide payments in this situation:

     *HUD Partial Claim~ It the loan is and FHA backed loan  In essence HUD provides an interest free second mortgage.

     *An Advanced Claim~ If the loan has mortgage insurance coverage that insurance company might provide the funds to bring the loan current and allow a provision for deferred repayment.

     *Fannie Mae HomeSaver Advance~ A low interest loan repaid over 15 years to bring the loan current and is available on most Fannie Mae insured loans. 

     Remember there is help available to assist you to prevent a foreclosure.  Banks are not in the business to own real estate and would much rather keep a homeowner in their home.  They have the option of lengthening the term of your loan, lowering the interest rate, and/or reduce the amount of principle left on your loan.  If you or someone you know is facing financial difficulties please pass this information onto them.  The more people who work through their difficulties with their lender rather than allow the bank to foreclose on their home the better off we all are.

Historically the holidays have been a slow time of year for real estate sales in North Carolina.  In this unpredictable economic environment no one know when the official bell will ring indicating “the bottom” has finally been reached and it is time to start buying real estate again.  Rumor has it that interest rates will likely reach 4.5% for new purchases soon.  Surely that will create a huge buying spree.  So if you are thinking about listing your home in the spring perhaps you should reconsider and potentially list sometime soon.  Here are 11 other reasons you might want to consider when thinking about listing your home during the holidays:

1.  There will be less competition for buyers.  This spring will bring a flood of new homes coming to market.  Due to the law of supply and demand…you might actually yield more money for your home now vs. this spring.

2.  Winter prospects tend to be more serious buyers.

3.  Your home looks better during the holidays.

4.  One of the highest percentages of “Listing Sold” to “Listing Taken” occur during this time of year.

5.  Throughout the holiday season , you may restrict showings during your personal family events.

6.  Buyers have more time to look at homes during the holidays, especially during vacation.

7.  January is traditionally the biggest transfer month…and you must be on the market to capture that market.

8.  By selling now you can have a delayed closing or extended occupancy until the beginning of the following year if you want it.

9.  When you sell during the winter you have an opportunity to buy during the spring, when many homes are on the market.

10.  You may have fewer actual showings, but more qualified and motivated prospects.

11.  Corporate transferees, who need to buy a home now, can’t wait until spring.

Ever wonder what remodeling jobs are worthwhile as you consider putting your home onto the market?  Some Sellers wonder if they should in fact hold off on doing a remodel job prior to selling their home thinking that a typical buyer might rather do that remodel themselves.  Not true.  Most buyers prefer not to lift a finger after they move into a home.  Studies show that your home will sell faster and for a higher price if those remodel jobs are done prior to listing your home.   Many people also wonder what home improvement projects will more likely pay for themselves when putting your home onto the market?  Here is a link to a great article that details what remodel jobs are likely to pay for themselves when selling your home:

http://www.realtor.org/rmohome_and_design/articles/2008/0812_costvsvalue_2008?id=bcaa4b804bfb44b98fe18f66fe42bfc9&wcm_page.resetall=true&cache=none&contentcache=none&connectorcache=none&srv=page

Never before has this statement been truer!  When Sellers are considering an initial list price in our current market it is vital to have the home competitively priced.  If not you will most likely not even get any showings.  Buyers today have such a large number of homes to choose from.  They are seeking homes that have the potential to maintain their value even if the market continues to decline.  Even if you have an extremely lovely home with exceptional decorating, if it is not priced for today’s market Buyers will not even consider looking at your home because there are tons of other pretty homes available at lower prices.  Here’s a link to a great article that elaborates on this topic:

http://www.visualtour.com/shownp.asp?T=726404