Lease as an alternative to foreclosure?

Did you know that you may be able to lease your property back from your lender as an alternative to foreclosure?

The Deed-For-Lease™ option is a program from Fannie Mae that allows you to lease your home after you have transferred the title to your property to the mortgage company (commonly called a Deed-in-Lieu of Foreclosure). The lease terms are up to 12 months (with the possibility to extend longer). And the monthly rent is based on the current rental rates for your area—not on your original mortgage payment.

Deed-for-Lease is an alternative to foreclosure and may be an option if:

You are ineligible to refinance or modify your mortgage, you are facing a long-term hardship, you are several months behind on your mortgage payments, you may owe more on your home than it’s worth, you have not been able to sell your home, or you want to remain in your home.

Deed-for-Lease is available for loans owned by Fannie Mae. If you loan is not held by Fannie Mae your lender may have similar programs available.

What are the benefits of a Deed-for-Lease?

Eliminate or reduce your remaining mortgage debt; Resolve your delinquency and avoid foreclosure; Stay in your home and neighborhood (no need to move or relocate); Lease at current market rate rent for up to 12 months with a possible option to extend the term; Pay no security deposit; Assistance for relocation may be available at the end of your lease; Start repairing your credit sooner than if you went through a foreclosure; May be able to get a Fannie Mae mortgage to purchase a home sooner (in as little as 2 years) by executing a Deed-in-Lieu than if you went through foreclosure (at least 7 years).

To explore your options I would recommend contacting a good Real Estate attorney.

Broward Homebuyers Can Get $2000 Tax Credit

The Housing Finance Authority of Broward County has launched a Mortgage Credit Certificate Program to help reduce home loan financing costs for qualified homeowners in Broward County.

The Mortgage Credit Certificate program entitles qualified applicants to a federal income tax credit in an amount of up to $2,000 annually. This enables qualified owners or buyers, who owe federal income taxes, to benefit from a dollar-for-dollar reduction of their tax bills. Additionally, the homeowner will continue to receive the tax credit each year they continue to live in the home financed under the program.

The Mortgage Credit Certificate is not a mortgage; however, it may be used in conjunction with a first mortgage from a participating lender (except a mortgage revenue bond loan.) Borrowers must meet normal mortgage underwriting requirements, which demonstrate credit worthiness, and meet the program's income and home purchase price requirements.

Interested parties should click here to visit the Broward County Housing website or feel free to drop me a line for more info.

New State property laws take effect

There are a couple of new laws property owners should keep in mind as the 2010 property tax season kicks off.

If you've added buildings, additions or other improvements to your property, you can be spared from the standard retroactive taxes that have been charged in the past.

The state Legislature passed a law this year providing relief for homeowners that have added improvements, buildings or other changes to their property. If the homeowner reports the additions to the county property appraiser before Jan. 1, the improvements will only be reflected in their 2011 assessments. Under normal circumstances, once additions are discovered, the homeowners would be responsible for up to three years worth of back taxes for the value of the improvements.

Also, if your home is severely tainted with Chinese drywall, your property should be valued at $0, because of a law passed this year in the state Legislature. If the building is uninhabitable, owners will not have to pay property taxes on it until it is repaired. Homeowners still have to pay taxes on the land the property sits on, and Non Ad-Valorem taxes will also be required. Affected homeowners should provide their county appraiser documentation showing that their homes contain the drywall, which emits sulfur odors and can cause structural damage.

MORTGAGE HELP FOR UNEMPLOYED

HAMP, HAFE and now UP.

UP is the Home Affordable Unemployment Program. It is a new program designed to supplement the Home Affordable Modification Program (HAMP) which provides assistance to unemployed borrowers by granting them a forbearance period which reduces or suspends their monthly mortgage payment.

This program goes into effect on July 1, 2010 for participating HAMP mortgage servicers. It applies to first mortgages taken out prior to 1/1/09 on one to four family units that are the principal residence.

Florida condo association update

Gov. Charlie Crist signed into law a measure Tuesday that will allow Florida's condo associations to go after up to twice the amount of delinquent dues owed them.

Condo associations had previously been limited to six months' worth in most cases.

When the law takes effect on July 1, associations also will be able to deny owners who owe money access to pools or other common-ground amenities.

Other provisions of the "Distressed Condominium Relief Act" let an association either delay or discard some previously required -- and very costly -- upgrades to a building's fire alarms, sprinklers system and elevators.

The new law is another government effort to help Florida's condo associations recover from a years-long slide in revenue from dues, plummeting unit values and declining occupancy rates as foreclosures ran rampant in the wake of the real estate downturn.

Mortgage rates could go up

On March 31, the Federal Reserve will stop buying mortgage-backed securities from Fannie Mae and Freddie Mac, returning control of interest rates to private investors.

For months, industry observers have predicted that once government supports are removed, interest rates will rise quickly, discouraging many of the first-time buyers critical to housing's recovery.

In late summer and fall 2009, lured by fixed 30-year mortgage rates under 5 percent and the first $8,000 tax credit, which expired Nov. 30, first-timers pushed sales of previously owned homes to the highest levels in at least three years, reducing record inventories and braking price declines.

That tax credit was renewed Nov. 5 and expanded to buyers who had not purchased a property in five years, although the credit for repeat buyers is $6,500.

The second credit expires April 30, is unlikely to be renewed, and remains the engine moving buyers.

As the date for the Fed pullout approaches, analysts now generally agree that an immediate rate spike is no longer the likely result.

Meanwhile, the Fed repeated Tuesday its pledge to hold interest rates at record lows to foster the U.S. economic recovery and ease unemployment. The Fed held its target range for its bank lending rate at zero to 0.25 percent, where it's been since December 2008.

In response, commercial banks' prime lending rate, used to peg rates on certain credit cards and consumer loans, has remained at 3.25 percent -- its lowest in decades.

But the Fed's assessment of the economy was a bit more upbeat. It said the job market is stabilizing. That was an improvement from its January statement, when it said the deterioration in the labor market was abating.

It also said business spending on equipment and software has risen significantly, also an upgrade from its last assessment.

Still, the Fed cautioned that spending by consumers could be dampened by high unemployment, sluggish wage growth, lower wealth and tight credit.

And it noted weakness in the commercial real-estate and home-building markets. That's one reason why analysts are concerned about a potential rise in mortgage rates when the Fed buyback program ends. But some say they don't expect any increase to be enough to stymie the recovery in the housing market.

Bankrate.com columnist Holden Lewis said rates are so low now -- averaging 4.87 percent for a 30-year fixed -- that an increase ``is inevitable. But maybe they'll rise gradually instead of jumping'' April 1.

FHA Suspends Anti-Flipping Rule to Spur REO Sales

HUD TAKES ACTION TO SPEED RESALE OF FORECLOSED PROPERTIES TO NEW OWNERS.

On Friday January 15, 2010 FHA announced it is temporarily lifting an "anti-flipping" rule, allowing borrowers using government-insured loans. In most cases, FHA currently prohibits insuring a mortgage on a home owned by the seller for less than 90 days. This temporary waiver will give FHA borrowers access to a broader array of recently foreclosed properties.

"This change in policy is temporary and will have very strict conditions and guidelines to assure that predatory practices are not allowed," HUD Secretary Shaun Donovan said.

In today's market, FHA research finds that acquiring, rehabilitating and the reselling these properties to prospective homeowners often takes less than 90 days. Prohibiting the use of FHA mortgage insurance for a subsequent resale within 90 days of acquisition adversely impacts the willingness of sellers to allow contracts from potential FHA buyers because they must consider holding costs and the risk of vandalism associated with allowing a property to sit vacant over a 90-day period of time.

The policy change will permit buyers to use FHA-insured financing to purchase HUD-owned properties, bank-owned properties, or properties resold through private sales. This will allow homes to resell as quickly as possible, helping to stabilize real estate prices and to revitalize neighborhoods and communities.

The waiver will take effect on February 1, 2010 and is effective for one year, unless otherwise extended or withdrawn by the FHA Commissioner. To protect FHA borrowers against predatory practices of "flipping" where properties are quickly resold at inflated prices to unsuspecting borrowers, this waiver is limited to those sales meeting the following general conditions:

• All transactions must be arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction.
• In cases in which the sales price of the property is 20 percent or more above the seller's acquisition cost, the waiver will only apply if the lender meets specific conditions.
• The waiver is limited to forward mortgages, and does not apply to the Home Equity Conversion Mortgage (HECM) for purchase program.

Specific conditions and other details of this new temporary policy are in the text of the waiver, available on http://www.hud.gov/offices/hsg/sfh/waivpropflip2010.pdf

A Loan Modification should cost you nothing!

There is no reason to pay someone for something you can do yourself for free. If you want to keep your home, there are some important points you need to know before contacting your lender. I will go over them with you and check your finances to maximize your probability for success at no cost to you! Get caught up and a rate of 2-4% to help get you back on track. To determine if this may be an option for you, see the questions below. If you can answer yes to the questions below, contact me to discuss your next step.

1. Is your home your primary residence?
2. Is the amount you owe on your first mortgage equal to or less than $729,750?
3. Are you having trouble paying your mortgage? For example, have you had a significant increase in your mortgage payment OR reduction in your income since you got your current loan OR have you suffered a hardship that has increased your expenses (like medical bills)?
4. Did you get your current mortgage before January 1, 2009?
5. Is your payment on your first mortgage (including principal, interest, taxes, insurance and homeowner's association dues, if applicable) more than 31% of your current gross income?

Note: if you are uncertain, click here to determine percentage