Monthly Archives: July 2014
The California Housing Finance Agency announced today a major program expansion to help more low to moderate income California families purchase homes.
CalHFA will remove the first-time homebuyer requirement on its first mortgage programs to allow more California homebuyers to take advantage of the benefits of CalHFA’s affordable financing.
The new policy goes into effect today, June 16.
“CalHFA’s mortgage loans will now provide more low to moderate income families across the state with affordable opportunities to purchase homes with fixed-rate mortgages and down payment assistance programs,” said CalHFA Executive Director Claudia Cappio.
California’s homeownership rate stands at about 54.5 percent as of the end of the first quarter of this year, according to U.S. Census estimates, a full 10 percentage points below the national homeownership rate. California’s rate dropped from more than 60 percent before the Great Recession.
Studies also show that homeownership is linked to stronger neighborhoods, better educational achievement, civic participation and healthier outcomes. CalHFA’s lending programs provide unique opportunities for families to purchase homes, including:
– Offering a first mortgage for 97 percent of the value of the home, combined with a 3 percent built-in down payment second.
– Access to no interest and low-interest down payment assistance loans that don’t have to be repaid until the home is sold, refinanced or the mortgage is paid off.
Your Loan in the Valley
Participating in either a short sale or a foreclosure is never a fun ordeal, but when it comes down to it to have a short sale on your record as opposed to a foreclosure you look much better on paper—consider it a ‘resume booster’ for your credit report. Also, those with short sales are welcomed back into the housing market much faster than those with foreclosures. Some borrowers with a short sale can be welcomed back into the market in as quick as no time at all, if it is an FHA loan and “given that the borrower did not default on the prior mortgage at the time of the short sale, and all of the other payments on the previous loan (as well as other debt payments) were on time for 12 months before the date of the short sale, as long as it does not appear that the borrower was taking advantage of the mortgage market and attempting to purchase the same kind/size of home in the same proximity of the home that was short sold.
However, short sales are frequently mistakenly recorded on the borrowers’ credit report as a foreclosure.
A foreclosure on the credit report instead of a short sale can set credit scores back farther and also may exile that borrower out of the housing marketing for much longer than they would with a short sale – seven years. A short sale merely damages credit scores, while foreclosures butcher them. The reason for this misrepresentation on the credit report is that the mortgage industry does not have a separate reporting code for short sales, which leads us all to the question, why not? Senator Bill Nelson recently brought attention to the subject and made it the center of a federal investigation as to why the separate code ceases to exist.
ABC Action News reported that Fannie Mae recognized that they “cannot identify short sales on the credit report data”. With this being the case, the next step was to hit up the credit reporting agencies. Experian credit reporting agency stated, “the shorts sales and foreclosures are being coded correctly on Experian’s credit reports. Where we have found the discrepancies occurring is in the underwriting process”. As 2.2 million people opted for short sales since the crash of the housing market, and with all of the agencies placing the blame on the next guy, homeowner’s need to take matters into their own hands if they ever want to buy in the near future. This should not only be said for home buying, either. The amount of damage that the foreclosure has on the credit score can severely hinder the borrower from obtaining a fair car loan or making other large purchases without being subject to astronomical interest rates and unfair terms. Borrowers need to demand a letter from their lender stating that it was a short sale, and any markings of foreclosure should be deleted immediately. We can’t make any promises that it will be smooth sailing from there forth, but the key is to follow up with your new lender with regards to the matter as much as humanly possible to the point that they know they must tend to your file. Homeownership is our right as Americans, but as much of a nuisance as it is, there are times when we have to be very proactive to attain our goals. Source: bankrate.com
Your Loan in the Valley
Making money through real estate is a tried and true way to wealth for many people. Investors may specialize in different areas of real estate, such as residential, land or commercial. Some investors “flip” houses for profit, while others hold on to real estate for a long time. Some investors advertise online, while others are found through word of mouth. If you want to find real estate investors, you have to go where they go. Most investors are very interested in working on deals relating to their specialty, so it is not hard to get their attention.
1. Visit the websites for REI Club, National REIA or Bigger Pockets to find the local real estate investor’s club near you. Find out when they are having their next meeting and attend. REI clubs might specialize in a certain area of real estate, so contact the group leader first and tell him what kind of investor you are seeking. You will likely meet several investors at these groups who may be interested in working with you.
2. Browse the forums on the real estate investor websites and see if there are any investor programs or mentor programs in your area. There is a topic for almost every category in real estate, from finding mentors and investors to educational programs and advice.
3. Visit the Craigslist or Backpage websites. Look through the “Real Estate” section for investor ads and contact the posters. Ads that say “We Buy Houses” are usually placed by investors or groups of investors.
4. Post an ad online asking investors to contact you and add any other relevant information that might interest them. Real estate investors spend a lot of time online searching for new deals, and they might come across your ad.
5. Ask any real estate agents you know if they personally know any investors. Many investors are not agents themselves but work closely with agents. Finding an investor through word of mouth is a good option, because they are recommended by someone you know. Source: homeguides.com
Your Loan in the Valley