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Beginning April 2010 New Alternatives to Foreclosure-Also, San Diego County Tax Credits for 1st Time Homebuyers
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Beginning April 5, 2010, a new Federal Program will launch to provide Alternatives to Foreclosure
As this challenging year comes to a close, many of us have been touched one way or the other by the economy. Whether the effects of the economy reduced our stock portfolios, devalued commercial or residential real estate, or induced the negative results of what now seems as unfair loans made to borrowers just a short time ago. Some have suffered horrendously from the effects of not having the cash flow to keep up with loans written when times were better and the anticipation that the economy would continue to grow. Consequently, and mostly because of these economic times, many homeowners faced a Short Sale or Foreclosure.
Now there may be alternatives to foreclosure. That’s right. The U.S. Department of the Treasury recently announced a brand new program called The Affordable Foreclosure Alternatives Program (HAFA). Essentially this program is designed to find alternatives to foreclosure for homeowners who are unable to successfully modify their distressed mortgage. It sounds simple enough but the HAFA program encourages Short Sales and deeds in lieu of foreclosure by these means:
- Allowing pre-approved short sale terms before a property is listed.
- Preventing service providers from attempting to reduce real estate commissions established in the listing agreement as a condition for short sale approval.
- Releasing borrowers from future liability for the debt; and,
- Providing financial incentives to borrowers, service providers, and investors.
There are eligibility rules so consulting with your Realtor will pave the way for a better understanding of how this program will work.
San Diego County Tax Credits for First Time Home Buyers…another program to help stimulate buyers in San Diego County.
With the aforementioned Foreclosure Alternatives Program, there is exciting new information concerning tax credits for First Time Home Buyers in San Diego County.
The county Department of Housing and Community Development has received an additional $15 million for a program which began earlier and now brings the total to $26 million available to reduce federal taxes for eligible homebuyers up to 20% of the annual interest paid on a mortgage loan. This is huge because essentially this means with a first time homebuyer paying less tax, simply put the buyer’s net earnings increase. Some think this could result in the buyer more easily qualifying for a home loan. But, like most government programs there are eligibility requirements:
- Income of less than $109,020 for a family of three or more.
- Income of not more than $94,800 for a family of two or fewer.
- Must be buyer’s primary residence, and only a single-family detached home, condo, town home, or manufactured home with foundation.
- Must be in an unincorporated area, OR in the cities of Carlsbad, Chula Vista, Coronado, El Cajon, Encinitas, Escondido, Imperial Beach, La Mesa, Lemon Grove, National City, Poway, San Marcos, Santee or Vista. Oceanside and the city of San Diego proper have their own programs.
A Exclusive Properties Realtor will quick-start the steps involved by facilitating the initial loan process with the company’s onsite lender-affiliate RPM Mortgage.
On behalf of TheChaseAdvantage.com team…have a great holiday. Hopefully existing homeowners and first time homebuyers will come to realize the potential of these two programs and contact a Realtor today.
Related Posts: San Diego
New Federal Rules on Short Sales in the Making?
Posted by Bob Chase | Leave A Comment »
Just a few days ago, Kenneth Harney, a nationally syndicated real estate columnist, reported in the Washington Post that for those home owners in trouble on their mortgage and can’t get a loan modification, there may be light at the end of the tunnel for them. The Obama administration is adopting…or probably more appropriately…”will try to adopt” a new standard for short sales. The plan is essentially designed to assist short sellers speed up the process of what is traditionally “contentious” and incredibly time-consuming.
As a refresher, a Short Sale involves a lender or investor agreeing to collect less than the balance owed on a mortgage debt out of the proceeds of a negotiated sale of the property. A Short Sale can be looked upon as the last dying breath of an attempt avoid foreclosure for a distressed home owner.
Here are a few important points to remember for anyone considering a Short Sale. First, it is very important to see if the lender will accept a short sale. The lender will basically run the numbers to see if a short sale will yield more money at the bottom line than a foreclosure. So here’s what to do: Contact a Realtor (I have a great one in mind…ME!) who can put together the key information needed by the lender, i.e. recent comparables on CLOSED sales, local market trends, and the likely selling price of your house. At this point, you’ll want to have a buyer identified for the property, a buyer who’ll pay a price acceptable to the lender and has financing to close the deal.
Before adopting the new plan to stream line the short sale process, be sure to keep in mind that short sales could take months to close. Next, Lenders and Service providers will be required to use pre-approved Short Sale uniform documentation and accelerated turn around times. The plan also provides financial incentives for key players. Here is a sampling of incentives which are Pro Forma and certainly subject to change:
- Homeowners who successfully complete a short sale under the new program receive $1,500 to defray relocation costs.
- Mortgage providers can receive $1,000 per case.
- Second-lien holders receive up to $3,000 from the sale proceeds.
- Even Realtors are in the mix with rules prohibiting lenders from forcing them to cut commissions
There also could be a major stumbling block with the Administration’s plan. Harney reports that since the plan tilts toward the consumer by requiring second lien holders to “drop all financial claims against short-selling borrowers beyond the $3,000 they take out of the deal.”
Although Major Lenders are still studying the fine print, the initial reaction seems to be positive and there should be more information on this important development as the New Year begins.
Related Posts: Buyers, Market Trends, San Diego, Short Sales
Encinitas “West of the Five”– from Migrating Sanderlings to Real Estate
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Encinitas “West of the Five”– from Migrating Sanderlings to Real Estate
It’s that time of year again and the sanderlings are finding their way from colder climates including Alaska to warmer climates to the south. This picture was taken at Seaside Beach in Cardiff by the Sea, one of the villages in Encinitas. This beach area is a much needed feeding and resting stop for the flocks migrating south, and they’ll make their return again in the Spring. While they are enjoying this beach, they compete with human and animal visitors that also flock to it. Dogs, in particular, are found here because this beach is one of the few in North San Diego County that welcomes man’s best friend. Dog owners must return this wonderful beach favor by keeping their animals on a leash, picking up trash and “cleaning up” after their dogs. Considerate folks also keep themselves and their pets a distance from the migrating birds, particularly the sanderlings, because they are frightened easily.
Encinitas was incorporated in 1986 from the communities of historic Encinitas, new Encinitas (Village Park, etc.), Leucadia, Cardiff-by-the-Sea and Olivenhain. Surfing is legendary at Swami’s just a short mile north of Cardiff Beach, and when hunger strikes, restaurants abound with either Pacific Ocean horizons or tremendous food. The “on the beach” restaurants offer incredible beach watching, whale watching from December through March and the occasional winter storm that can bring some adrenaline-pushing wave watching as well. The cuisine offered in Encinitas, and particularly along the coast, is reasonably priced and rated high by both locals and visitors.
Old Encinitas holds the town’s annual Holiday Parade December 5th. Festivities this year kicked off with a Tree Lighting Ceremony at 5:00pm in the Lumberyard shopping center courtyard on Coast Highway 101. The Parade began at 5:30, heading south along Coast Highway 101 from D Street to J Street. This year’s Parade theme is “Season’s GreeNings,” celebrating all things environmental in Encinitas. In case you missed it, this Yule tide event is a Christmas Holiday staple happens each year.
Enjoy…and for those of you desiring to perhaps make Encinitas your next home…consult with a business savvy and knowledgeable Realtor from Exclusive Properties. Ask the migrating birds, and dogs alike, there is no mistaking the great value associated with the Encinitas area’s real estate. That is exciting. Single-family homes are selling and the inventory is shrinking, but we still see a number of distinguished properties in Encinitas that remain on the market offering good value in today’s market. According to the latest statistics, home prices are beginning to rise albeit slowly, but long term investment with value is here for the buyers particularly in Encinitas.
Buyer’s Agents and, yes, even those of us who have lived in the area for decades, often times forget the “West of the Five” labyrinth of back streets, alleys, cul-de-sacs, dead end streets, and enclaves with homes in all price ranges. You will find mobile homes on Vulcan listed for $42,000 (090049946) while driving less than a mile to another listing for $11,995,000 (090039675) on 4th street. By in large, the value of buying and living in the community of Encinitas is great for the heart, great for the family, and great for business.
We do indeed have much to be thankful for: Migrating sanderlings, a place for our dogs, tremendous surfing, great restaurants and all the precious jewels Encinitas has to offer. Merry Christmas, Happy Hanukkah and excellent tidings to all for the remainder of the year and next year as well.
Related Posts: Cardiff, Encinitas, San Diego
HUD, The Recovery Reinvestment Act, and You
Posted by Bob Chase | Leave A Comment »
Many Realtors are most likely familiar with the Recovery Act put into place by HUD enacted in February of this year. Now, two Neighborhood Stabilization Program Grants (NSPs) will be offered under Notices of Funds Availability or NOFAs. While NSP program funding, is appropriated by The US Recovery and Reinvestment Act it authorizes HUD to release untold Billions for distribution to ”national and local technical assistance providers” to support NSP Grantees.
Participating entities such as Community Housing Works, a behemoth organization under the guise of a non-profit, is working in most major cities, and has already amassed huge amounts of funding from the government Recovery Act, and they are working the system to gain exposure here in San Diego County right now. As Realtors, be aware of this organization. It could further impact the way you do business in San Diego County and could insert itself into Agency Agreements involving Short Sales, Foreclosures and REOs already in place under the blessings of the Federal Government (HUD).
Although there is no salient proof of any disrupting of an Agency Agreement, I am personally skeptical and plan to proceed with caution and knowledge when new government programs are introduced particularly when these new programs are introduced in the name of “stimulus” or “opportunity”. In this particular situation, it is important to understand what role local NSP Grantees will derive in real estate transactions involving NSP grants and whether these transactions can or will involve local Realtors. As near as I can determine becoming a Grantee is a competitive bid like situation determined through the tortuous HUD process and those entities meeting the qualifications as non-profit among other criteria, are considered favorably. Obviously, like any other federal funding program it does pay to have political influence, experience in the process and sufficient political acumen.
There are two NSP programs currently running. $4 billion has been allotted for NSP1 funds to carry out neighborhood stabilization programs to combat the effects of home foreclosures and other properties consider blighted as determined by yes, local officials. And, the second generation, NSP2 program, offering $1.93 billion on a competitive basis to states, local governments, and non-profit organizations as well. The deadline to apply for NSP2 funding is July 17, 2009, and again any non-profit entity can apply. The County of San Diego is applying for the NSP2 Grant.
Related Posts: Financial news, San Diego
Happy 4th of July
Posted by Bob Chase | Currently 1 Comment »
The 4th marks an important day in our history and particularly in remembering the basics of free enterprise, faith in the country’s resilience, and hope that our leadership will find ways to further the American dream through this tough economy. It’s especially important to remember and help with reinforcing and strengthening the fabric of American ideals because sustaining the American way is the right way.
Enjoy your day, fly your flag, and give thanks for the opportunity to live in America. Perhaps all of us can make a difference.
Clients should be reminded that investing in today’s real estate market is a great alternative to building wealth!
“Is life so dear or peace so sweet as to be purchased at the price of chains and slavery? Forbid it, Almighty God. I know not what course others may take, but as for me, give me liberty or give me death!” –Patrick Henry
Related Posts: Area Information, San Diego
