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Laura Key 5/6/13 Laura Key 5/6/13

Despite Improvement in Loan-Mod Defaults, Report Raises Alarms

Sadly, loan modifications have not been very successful. Have you had your modification denied? Call me - Laura Key 310.866.8422

There are few defenders of the Obama administration’s signature loan-modification initiative, the Home Affordable Modification Program, or HAMP. But a new report released on Wednesday raised an interesting criticism of HAMP—that borrowers aren’t staying current on modified payments even though HAMP has reduced, on average, borrowers’ monthly payments by more than $400.

The report, from the special inspector general for the Troubled Asset Relief Program, or Sigtarp, said there was an “alarming rate” of homeowners who were defaulting after receiving a permanent mortgage modification.

The report says data show that the longer a homeowner remains in HAMP, the more likely he or she is to redefault out of the program. This is true of almost any mortgage-modification program.

But the report raises broader questions about whether mortgage modifications have been worth the costs, and against what yard stick success in any such program should be measured.

There are plenty of faults to find with HAMP. Officials struggled to ensure taxpayer money wasn’t wasted, so they required lots of documentation. That created new headaches: banks rejected borrowers that they said provided incomplete forms, while borrowers routinely complained that banks lost their paperwork. In an interview last year, Shaun Donovan, the housing secretary, said it was a “fair criticism that programs initially were too complicated and had too many restrictions.”

Mortgage servicers were also overwhelmed. During tense meetings at the Treasury Department throughout 2009 and 2010, officials laid into the banks for not staffing up. Executives groused that HAMP rules changed so often that they couldn’t keep up and that new headline-grabbing initiatives were announced before they could be rolled out to be offered to borrowers.

Others said HAMP didn’t do enough to deal with negative equity, which prompted the administration to launch a belated effort two years ago to encourage principal reduction. The Treasury never made it mandatory because they feared it would both be too expensive and that it would lead banks to opt out of HAMP.

Under HAMP, banks received modest incentive payments to reduce borrowers’ monthly payments to around 31% of their current income, often by extending the loan term and dropping the interest rate. Modifications have resulted in an average monthly payment reduction of $545 or $400, depending on which type of modification lenders provide under the program.

So far, around 860,000 borrowers have active HAMP modifications, and around 290,000 have fallen out of the program. The Sigtarp report said it was “alarming” that 46% of a few thousand permanent modifications made in the third quarter of 2009 had redefaulted, as well as 39% of those made in the last quarter of 2009.

But some industry executives have said that, for all its faults, HAMP succeeded in giving the industry a template for a more sustainable loan modification. Before 2009, many modifications didn’t result in lower monthly payments, and mortgage modifications in the post-HAMP world have performed drastically better than those that came before. Around 25% of borrowers who received a modification in 2011 had fallen behind on payments within one year, down from 57% in 2008, according to banking regulators.

Moreover, more recent HAMP modifications are performing significantly better than earlier HAMP “mods,” something that may be owed to an improving economy as much as any program improvements. Around 11% of HAMP modifications made in late 2011 had defaulted after one year, compared with more than 20% for those made when the program launched in mid-2009.

Data also show that HAMP modifications, which typically offer the most generous payment relief, perform better than privately issued modifications.

Among the bigger questions raised by the report: If mortgage modification redefault rates under HAMP are too high, what’s an acceptable level? And can any mortgage modification program hit those targets?

Source: Wall Street Journal

Laura Key 5/5/13 Laura Key 5/5/13

First comes home, then comes marriage?

Couples today are significantly more likely to purchase a home before marrying than older couples were, according to a survey commissioned by real estate franchisor Coldwell Banker that appears to point to a cultural shift in views toward homeownership and marriage.

Twenty-five percent of married couples between the ages of 18 and 35 bought their first home before their wedding date, compared to 14 percent of married couples who are 45 or older, according to the survey, which was administered by Harris Interactive on behalf of Coldwell Banker.

"While life goals and expectations continue to weigh on young couples, their views of homeownership are transcending their plans of marriage and starting a family, creating a direct effect on the patterns of buying a home altogether," said Dr. Robi Ludwig, Coldwell Banker's lifestyle correspondent. "What we're seeing is that young couples are switching up the order and purchasing their first home regardless of whether or not they have set a wedding date. This is a huge movement within the American culture. While younger generations may be focusing more on their career, and in turn waiting longer to get married and have children, they are not delaying their dream of homeownership."

Other findings of the study include:

Eighty percent of homeowners surveyed said buying a home strengthened their relationship more than any other purchase.
Thirty-five percent of married homeowners purchased their first home by their second anniversary.
Ninety-three percent of homeowners who purchased their first home while married always planned on buying a home after marrying.
Thirty-five percent of married homeowners wish they had bought a home earlier than they did.

Is your big day coming up! Time to settle into a nest! Call me today! Laura Key 310.866.8422

BY INMAN NEWS, MONDAY, APRIL 22, 2013. Inman News®

Laura Key 5/4/13 Laura Key 5/4/13

Does HUD Offer Special Programs for Homebuyers?

Buying a HUD Home is not as difficult as you may think! I have helped many people purchase their 1st Home from HUD! Call me today for more details about the process! Laura.A.Key@gmail.com or Visit my website to sign up for FREE HUD Listings! http://www.KeyCaliforniaHomes.com

Yes, HUD offers a program called the GOOD NEIGHBOR NEXT DOOR PROGRAM for Police Officers, Firefighters, EMT and Teachers! Call for more details on this program! 310.866.8422. If foreclosures are not sold within six months, HUD will sell them for $1 each to approved nonprofit organizations and government agencies. Homes must then be used create housing for families in need or to benefit neighborhoods.

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Laura Key 5/1/13 Laura Key 5/1/13

Does HUD Offer Financing On Their Homes?

Buying a HUD Home is not as difficult as you may think! I have helped many people purchase their 1st Home from HUD! Call me today for more details about the process! Laura.A.Key@gmail.com or Visit my website to sign up for FREE HUD Listings! http://www.KeyCaliforniaHomes.com

HUD does not provide direct financing to buyers of HUD Homes. Buyers must obtain financing through either their own cash reserves or a mortgage lender. If you have the necessary available cash or can qualify for a loan (subject to certain restrictions) you may buy a HUD Home. While HUD does not provide direct financing for the purchase of a HUD Home, it may be possible for you to qualify for an FHA-insured mortgage to finance the purchase.

Laura Key 4/30/13 Laura Key 4/30/13

HUD-Owned Homes Expected to Surge

Soon the market will be filled with new listings from HUD! Are you prepared? Make sure you use an agent who is HUD experienced and can help you find the home of your dreams. I have closed many HUD homes in the past few years! Let me assist you! Laura Key 310.866.8422

The U.S. Department of Housing and Urban Development is reportedly going to be releasing more of its homes to the market, which could be welcome news to buyers who have faced slim pickings in for-sale inventories.

Over the next two years, experts predict that HUD homes on the market will increase significantly as lenders work through the backlogs of foreclosures and foreclosure reviews.

“The inventory is there, [it’s] just not being released during the banks/servicers review of the loan/mortgage documents,” says Nat Genis, a HUD listing broker in Riverside County, Calif., which is already seeing an increase in HUD-owned homes.

"HUD homes are back," Genis told HousingWire. "FHA financing went away with the 'creative' financing of the 80/20 loans, and now with the increase of FHA financing, these government-backed loans guarantee that if the borrower defaults, HUD will pay off the mortgage, obtain the deed, and re-sell the home."

HUD-owned homes can be appealing because of the discounted sales price, even though they can be in poor condition often times, HousingWire reports.

HUD had 39,442 homes in its REO inventory nationwide as of Feb. 28, 2013—with 20,536 of those having pending contracts on them, according to HUD.

Source: “HUD homes add to inventory-starved market,” HousingWire (April 29, 2013)

Laura Key 4/28/13 Laura Key 4/28/13

Do I Need An Appraisal On A HUD Home?

Buying a HUD Home is not as difficult as you may think! I have helped many people purchase their 1st Home from HUD! Call me today for more details about the process! Laura.A.Key@gmail.com or Visit my website to sign up for FREE HUD Listings! http://www.KeyCaliforniaHomes.com

It is not necessary to have a HUD home independently appraised, HUD offers an appraisal every 6 months. Your Lender may require a more current appraisal than the one provided by HUD. Ask your loan officer or HUD registered agent.

Laura Key 4/25/13 Laura Key 4/25/13

How Much Money Will I Have to Put Down on a HUD Home?

Buying a HUD Home is not as difficult as you may think! I have helped many people purchase their 1st Home from HUD! Call me today for more details about the process! Laura.A.Key@gmail.com or Visit my website to sign up for FREE HUD Listings! http://www.KeyCaliforniaHomes.com

If the bid price is less than $50,000, you’re required to make an earnest money deposit of $500. HUD homes priced greater than $50,000 require a $1000 deposit.

Laura Key 4/24/13 Laura Key 4/24/13

Can You Buy a Home That Isn’t for Sale?

With inventory so low in Cali you must think outside the box. I'm willing to go there with you! Laura.A.Key@gmail.com

It may seem like an odd question, but apparently, you can!

The shortage of homes on the market right now is driving both real estate agents and consumers to get creative in their efforts to find their dream home. One recent survey reports a dramatic drop in the number of homes for sale in 2013 (specifically, they say that there are 14% fewer homes for sale this year than in years past). One prime example of this shortage is in Orange County, California, where there are 9000 fewer homes on the market than there were three years ago!

With the spring season upon us, realtors have been using their creativity to try and coax potential sellers out into the market, but even with their efforts, there is still a major lack of inventory. Although it may prove to be a challenge, it is still possible to find homes that aren’t even on the market yet. If you’re patient enough, you can be first on the list should a home go up for sale!

How do you do it?

One way is to look for homes where the current owner has defaulted on their loan. There is a period of time before the bank forecloses on the home where you can make an offer to a homeowner who may be struggling with paying their mortgage. By approaching the homeowner before the bank forecloses, you can save the homeowner from foreclosure and buy a home that hasn’t been listed yet.

By doing some research, you may be able to find potential sellers that previously had their home on the market, but took it off either because of the lousy market, or for other reasons. When you find one, send a letter to the homeowner, and ask them to contact you should they decide to relist their home, or make them an offer worth consideration even if they had changed their mind about selling.

(One thing to be careful of when contacting homeowners is that it is illegal to place something in another person’s mailbox. Either mail the letter through post office, or leave the letter at the front door.)

You may also be surprised to discover that there are websites where people “list” their homes at their fantasy price. Although these are not official listings, you may find a home where their fantasy price isn’t that far off from your reality price! By searching for these homes, you at least can get an idea of people who could be persuaded to sell if you are willing to make their fantasy a reality.

Finally, to buy a house that isn’t for sale, take a shot in the dark and contact homeowners of houses you love. Although this is a long shot, people have actually been known to sell their homes in these situations. Mail the owner a letter about why you love their home, and why you are so interested in purchasing it. Ask the homeowner to contact you and let you know if they have any intentions whatsoever, or to contact you first should they ever decide to sell.

The trick to reaching out this way is to be flexible and to offer scenarios that may be mutually beneficial. For example, you may offer to rent out the home after purchase for a period of time while the homeowners search for another house. It may seem like a long shot, but it’s definitely worth a try if you really love the house!

This article is brought to you exclusively by RealtyPin.com

Laura Key 4/22/13 Laura Key 4/22/13

Should I Get A Home Inspection If I Am Buying A HUD?

Buying a HUD Home is not as difficult as you may think! I have helped many people purchase their 1st Home from HUD! Call me today for more details about the process! Laura.A.Key@gmail.com or Visit my website to sign up for FREE HUD Listings! http://www.KeyCaliforniaHomes.com

HUD does not warrant the condition of its properties and will not pay for the correction of defects or repairs. Since the new owner will be responsible for making needed repairs, HUD strongly urges every potential homebuyer to get a professional inspection prior to submitting an offer to purchase.

If you are interested in acquiring a HUD Home that is in need of repair, you may be interested in applying for an FHA 203(k) Rehabilitation Loan. When a homebuyer wants to purchase a house in need of repair or modernization, the homebuyer usually has to obtain financing first to purchase the dwelling; additional financing to do the rehabilitation construction; and a permanent mortgage when the work is completed to pay off the interim loans with a permanent mortgage. Often the interim financing (the acquisition and construction loans) involves relatively high interest rates and short amortization periods. The Section 203(k) program was designed to address this situation. The borrower can get just one mortgage loan, at a long-term fixed (or adjustable) rate, to finance both the acquisition and the rehabilitation of the property.

Will HUD make the repairs?

HUD homes are sold as-is. The new owner is responsible for all repairs and improvements.

Can I start improving on the property right away?

If HUD accepts your offer, you cannot make any repairs or home improvements until the escrow transaction has closed and title is recorded in your name.

Laura Key 4/19/13 Laura Key 4/19/13

Is There Anyway To Have My HUD Offer Considered Before Others?

Buying a HUD Home is not as difficult as you may think! I have helped many people purchase their 1st Home from HUD! Call me today for more details about the process! Laura.A.Key@gmail.com or Visit my website to sign up for FREE HUD Listings! http://www.KeyCaliforniaHomes.com

Owner occupants always have first priority; however, if there are not any bids after the 30^th day then bidding is open to all bidders (investors). All offers are due by the bidding date and the HUD system generally picks the highest and best offer.

Laura Key 4/18/13 Laura Key 4/18/13

White House Rolls Out 3 Foreclosure Prevention Efforts

Even though the market has become of hot bed in these last few months. There are still homeowners struggling to keep their homes. Here are some new programs that may help. Are YOU facing foreclosure? Call me! Laura Key 310.866.8422

The Obama administration announced the extension or debut of three programs aimed at helping distressed home owners avoid foreclosure. The three initiatives are:

Increasing outreach in the Making Home Affordable Program: The U.S. Department of Treasury is partnering with NeighborWorks America as well as the National Foreclosure Mitigation Counseling program to increase support for struggling home owners who seek assistance through the Making Home Affordable Program, which includes the Home Affordable Modification Program (HAMP). HAMP reduces monthly payments by more than $540 each month, on average. “Through the new initiative, housing counseling agencies will help struggling home owners successfully complete and submit application documents to their mortgage company free-of-charge,” according to the White House blog.

Informing the unemployed about programs: The Department of Labor will be encouraging American Job Centers to inform unemployed home owners about federal foreclosure prevention options that are available to them. For example, there is unemployment forbearance through HAMP that allows qualifying home owners who are unemployed to reduce or suspend their mortgage payments for up to 12 months.

HUD’s new Housing Counseling Office: The Department of Housing and Urban Development has launched a Housing Counseling Office, which offers at-risk home owners free or low cost information about foreclosure prevention and loan modification programs. It also offers general information on buying or renting a home, handling foreclosures, and how to avoid scams. The office is made up of a network of 2,500 HUD-approved housing counseling agencies.

“While we are encouraged that the housing market is on the path to recovery, our job is far from finished,” according to the White House blog. “There are still many struggling home owners who need assistance. By connecting eligible home owners with existing foreclosure prevention programs, our new counseling initiatives will enable more borrowers to remain in their homes and go a long way in ensuring a brighter economic future for these families.”

Source: The White House Blog

Laura Key 4/16/13 Laura Key 4/16/13

Rising Student Loan Debt Keeps Buyers Out

There are simple solutions around this issue. Call me today to discuss your options! Laura Key 310.866.8422

Between 2004 and 2012, student loan balances nearly tripled, according to a new survey from the Federal Reserve Bank of New York. What’s more, one-third of student loan borrowers are delinquent on their debt, according to the Federal Reserve report. This will impact their credit rating and possibly keep them out of the mortgage market much longer.

"Short term, you see a decrease in the number of first-time home buyers," Brian Coester of Coester Valuation Management told CNBC. "You're going to see somebody who would have been able to afford a more expensive house maybe go for the lower version or the downgraded version."

Potential buyers with heavy student debt burden have been forced to rent or even move back in with their parents as they chip away at their debt.

"Long term it's going to really affect especially the upper end, because people aren't going to have the excess income to buy the jumbo property or buy that high end property," says Coester. "It' s going to affect home prices as a negative, as more of a cap, because it's really debt that they are servicing."

Source: “Student Debt Is Housing’s $1 Trillion Challenge,” CNBC.com (April 8, 2013)

Laura Key 4/16/13 Laura Key 4/16/13

Making an Offer On A HUD Home?

Buying a HUD Home is not as difficult as you may think! I have helped many people purchase their 1st Home from HUD! Call me today for more details about the process! Laura.A.Key@gmail.com or Visit my website to sign up for FREE HUD Listings! http://www.KeyCaliforniaHomes.com

Buyers will want to make offers based on ‘as-is’ appraisals determined by HUD. HUD will accept no offers that are lower than 50 percent of their appraisal. If you offer more than the appraisal price, you will be required pay the amount of the over-bid at closing, as your lender will base their loan amount on the appraised value of the home. Also, the process is a bit different than a regular offer on property. Your offer will be submitted online and government forms will be used to conduct the transaction.

Laura Key 4/14/13 Laura Key 4/14/13

Housing Shortage Will Dampen Spring Market

Buyers must be prepared more than ever! Do you have your PRE-APPROVAL in hand? It could mean the different of you getting your new home or renting for another year. Call me, let's discuss your options! Laura Key 310.866.8422

The housing recovery is progressing, but a shortage of homes on the market will limit the number of home sales this spring selling season, industry insiders say.

"If we don't see more people listing their properties, I don't think we will see the home sales volume increase that we are accustomed to seeing," Glenn Kelman, chief executive officer of Redfin told Reuters. "There are far more buyers than there are sellers on the market. We would have a huge boom spurred by low interest rates if there were more inventory on the market."

Still, the National Association of REALTORS® predicts existing-home sales will rise around 7 or 8 percent this spring compared to year ago levels.

In some areas where inventories are particularly constrained—like Washington, D.C., New York, and several California cities—homes are selling within hours of being placed on the market.

"The demand for properties is insane. The bidding wars that are going on, there is not enough inventory and it has become truly a seller's market again," says Neil Garfinkel, real estate attorney at Abrams Garfinkel Margolis Bergson in New York.

Source: “Analysis: Supply crunch to take steam out of home sales,” Reuters (April 3, 2013)

Laura Key 4/14/13 Laura Key 4/14/13

Economist Quashes Housing Bubble Rumors

I love what I do; however I have reservations about this report. I have had deep conversations with other agents and I firmly feel we are in a danger zone. Your thoughts? Laura Key 310.866.8422

Recently, rumblings of another housing bubble have been emerging, but one economist says with inventories expected to rise soon, the housing market is not at threat.

Rick Sharga, executive vice president with Carrington Mortgage Holdings, told a crowd at the REOMAC 2013 Summit & Expo in Dallas on Monday that the housing market should expect things to get worse before they start improving.

But “this is not the 2005 market,” he said. “We are not creating a bubble.”

Sharga says the lack of available home inventory is the reason why home prices are rising. New-home inventories are at their lowest level in more than 30 years, he said. “Very few markets are anywhere near where we were at the peak,” he said. The markets showing some “bubble-like tendencies” are housing markets that saw the biggest declines, he noted.

LPS Applied Analytics recently predicted that home prices could rise another 35 percent without affecting affordability.

Sharga predicts that by this time next year there will be too many homes for sale. Housing and foreclosure starts are expected to start rising within the next year.

Source: “Carrington’s Sharga: We Are Not Creating Another Housing Bubble,” HousingWire (April 8, 2013)

Laura Key 4/13/13 Laura Key 4/13/13

When Can I Bid on a HUD Home?

Buying a HUD Home is not as difficult as you may think! I have helped many people purchase their 1st Home from HUD! Call me today for more details about the process! Laura.A.Key@gmail.com or Visit my website to sign up for FREE HUD Listings! http://www.KeyCaliforniaHomes.com

Owner occupants can offer a bid on a HUD home during the first nine days. HUD will look at all bids on the 10^th day and decide based on which offer gives them the highest net profit. If there are two or more bids at the same net to HUD the offers will go into a lottery and the bid will be awarded based on chance. After the 10^th day if there aren’t any acceptable bids there will be an additional 20 days of bidding where bids are opened and reviewed daily for owner

Laura Key 4/11/13 Laura Key 4/11/13

Strange Real Estate News: Honey, There's a Gator in the Bathroom!

I'm afraid I would be putting the home on the market!

It was a typical Saturday in April when Alexis Dunbar walked into her Palmetto, Fla., home's bathroom to find herself staring at a 7-foot-long alligator. The reptilian intruder was staring back at her - with its jaws wide open.

Screaming, Dunbar and her boyfriend propped a small table against the door to keep the gator in the bathroom until help arrived.

The alligator apparently went through the cat door of Dunbar's home and, while looking for food or a cool place to rest, wandered into the bathroom.

The alligator was removed without damage to the home, and ABC Newsreports that Dunbar consequently decided to remove the cat door. One gator invasion was, apparently, enough.

Ready to move? Call me today to see how much your home is worth! The Market has Changed! Laura Key 310.866.8422

Laura Key 4/11/13 Laura Key 4/11/13

Shorter Term Loans

Laura Key 4/10/13 Laura Key 4/10/13

Who Can Buy A HUD Home?

Buying a HUD Home is not as difficult as you may think! I have helped many people purchase their 1st Home from HUD! Call me today for more details about the process! Laura.A.Key@gmail.com or Visit my website to sign up for FREE HUD Listings!http://www.KeyCaliforniaHomes.com

Almost anyone! If you have the cash or can qualify for a loan (subject to certain restrictions) you may buy a HUD Home. HUD Homes are initially offered to owner-occupant purchasers (people who are buying the home as their primary residence). Following the priority period for owner occupants, unsold properties are available to all buyers, including investors.

Laura Key 4/9/13 Laura Key 4/9/13

Does Moving Up Make Sense?

Don't get caught up in the madness of the market. Deciding to sell is a personal decision, take everything into account. I am here to assist! Laura Key 310.866.8422

These questions will help you decide whether you’re ready for a home that’s larger or in a more desirable location. If you answer yes to most of the questions, it’s a sign that you may be ready to move.

Have you built substantial equity in your current home? Look at your annual mortgage statement or call your lender to find out. Usually, you don’t build up much equity in the first few years of your mortgage, as monthly payments are mostly interest, but if you’ve owned your home for five or more years, you may have significant, unrealized gains.
Has your income or financial situation improved? If you’re making more money, you may be able to afford higher mortgage payments and cover the costs of moving.
Have you outgrown your neighborhood? The neighborhood you pick for your first home might not be the same neighborhood you want to settle down in for good. For example, you may have realized that you’d like to be closer to your job or live in a better school district.
Are there reasons why you can’t remodel or add on? Sometimes you can create a bigger home by adding a new room or building up. But if your property isn’t large enough, your municipality doesn’t allow it, or you’re simply not interested in remodeling, then moving to a bigger home may be your best option.
Are you comfortable moving in the current housing market? If your market is hot, your home may sell quickly and for top dollar, but the home you buy also will be more expensive. If your market is slow, finding a buyer may take longer, but you’ll have more selection and better pricing as you seek your new home.
Are interest rates attractive? A low rate not only helps you buy a larger home, but also makes it easier to find a buyer.