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Contact Me!
Direct: (818) 497-6829 or janieffres@gmail.com
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 The New York Times
Financing foreclosed homes
Foreclosure properties, especially those with the water and power turned off, may not qualify for standard financing, but would-be owner-occupants may qualify for a federally insured 203(k) loan.
Making sense of the story
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Would-be owner-occupants who do not have enough money to purchase a foreclosure home using cash, may qualify for the federally insured 203(k) loan, which allows borrowers to roll projected rehab costs into the loan.
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According to one real estate expert, most foreclosure properties are sold as is, and, oftentimes, heat, plumbing, and electric are turned off, making it unlikely a lender will lend money on the home.
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To qualify for a 203(k) loan, buyers generally hire an independent consultant hired by the Federal Housing Administration to review contractor cost estimates and architectural plans for things like whether the work will bring the property up to minimum standards, while not going overboard on improvements.
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Buyers should be aware that not all foreclosure properties are eligible. For instance, a partially built house that has never had a certificate of occupancy requires a construction loan of the kind that a commercial developer would use.
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The interest rate on a 203(k) loan is approximately a quarter of a percentage point higher than on a standard FHA-insured loan, and a buyer also can expect to pay 1 or 2 points.
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Also, as with other FHA-backed loans, down payments may be as low as 3.5 percent, and loan limits apply. Currently, most FHA loans are capped at $729,750.
Read the full story
In Other News…
Los Angeles Times
Are we facing the end of the 30-year fixed-rate mortgage?
Many housing proponents say the government’s move to dismantle Fannie Mae and Freddie Mac means the most popular home loan will be more expensive. But how much more is a matter of debate.
Read the full story
Orange County Register
No housing recovery until 2014?
More than half of Americans don’t think there will be a housing recovery until 2014 or later, a new survey shows. That’s up from 34 percent who responded that way in November 2010.
Read the full story
San Francisco Chronicle
Home sellers are financing buyers with poor credit
Financing provided by home sellers, popular in the 1980s when mortgage rates reached 18 percent, is making a comeback in markets that have been hit hard by foreclosures and where tightening lending standards and years of economic distress have drained the pool of creditworthy buyers.
Read the full story
Mercury News
Fixed mortgage rates touch new lows for 2011
Fixed mortgage rates fell this week to the lowest point of the year, offering incentives for homeowners to save money by refinancing their loans.
Read the full story
Los Angeles Times
Foreclosure rate slows as repossession timeline lengthens
Increased scrutiny of how lenders foreclose on Americans has dragged the repossession process out to unprecedented lengths, driving down the pace at which banks are taking back homes.
Read the full story
San Francisco Chronicle
Mortgage disclosures getting another revamp
A consumer watchdog agency unveiled two versions of a sample disclosure form Wednesday as part of its efforts to simplify the paperwork borrowers are currently handed when applying for a mortgage.
Read the full story
Los Angeles Times
Why are short sales so long and drawn out?
It’s understandable that lenders would want to get as much money as possible from a deal in which a home is being sold for less than what is owed on it, but turning short sales into an ordeal is discouraging potential buyers.
Read the full story
Press Enterprise
Freddie Mac launches promotion to sell its foreclosed homes
This week, Freddie Mac launched its HomeSteps Summer Sales Promotion, which offers to cover up to 3.5 percent of a buyer's closing costs.
Read the full story
Talking Points
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Occasionally, homeowners hoping to close a deal agree to purchase home warranties to give the home buyer peace of mind. However, prospective homeowners should do their homework to make sure the policies will actually help.
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Typical home warranties cover the major mechanicals and appliances in a home for one year after the sale. Warranties range in price from $350 to $800. If purchased from reputable companies, home warranties can help homeowners deal with broken appliances, malfunctioning air conditioning, and other problems.
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The policies usually require homeowners to contact the service company when something breaks. The company then sends out a repair person who provides an evaluation for a set fee, usually about $65. Once a professional has determined what the problem is, the warranty company pays for the broken items to be repaired or replaced.
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