HAFA Short Sale updates June 1 2012

HAFA Short Sale rules updated for the better

beginning June 1 2012

1.) Removal of owner occupancy requirement.

NOTE: borrower can not have purchased

another property within the past year. 

2.) $3000 relocation assistance incentive.

Limited to owner occupant or tenant occupying property at time of sale. 

 3.) Mortgage payment during review period
may exceed 31% if borrower remains
current with their payments. 

4.) Junior lien holders are now allowed $8,500. 

This should increase approvals by 2nd mortgage holders.

NOTE: Credit bureau reporting rules regarding Short Sales

are also changing but it is impossible at this time to determine

whether this change will cause less impact on borrower's credit scores.

Shopping for a home? Applying for a mortgage? You can fix your own credit, it's easy and it's free.

As a mortgage loan officer I run into this all the time so I thought this information was worth reprinting. So many folks are struggling with damaged credit in this economy, and most are unaware that they can fix it themselves, relatively quickly and at no additional expense. Carefully consider the advice below. It's possible you could be shopping for a home in a matter of just a few months.

Your credit score can improve faster than you may think. Here are a few tips for establishing good and countering bad credit.  

• Pay down current debt. (it's not always necessary to pay debt off, just work on paying down)
• Make ALL payments in a timely manner. No Late Payments! (this includes but is not limited to rent, utilities, credit cards, car loans, student loans, medical bills)
• Use credit cards very carefully to establish GOOD credit. (only charge what you can pay off at the next billing)   NOTE: you can not repair bad credit without reestablishing your GOOD credit.
• Think twice before applying for more credit. The simple inquiry itself can lower your score, and If you are declined it will count as a negative on your credit report.
• Work on removing items from your credit report that you feel were reported in error, or that are not yours. Check to be sure any closed accounts reflect "closed”. Contact credit reporting agencies and the creditor directly. The credit reporting agencies can explain the procedure. The creditor can provide the required documentation.

AVOID requesting your credit report from advertised services, there are usually strings attached. Only one credit report is truly free: www.annualcreditreport.com. You are entitled to one free report a year (you can pay for additional reports). It will include information from the three major reporting agencies, Equifax, Experian, and TransUnion.

AVOID credit repair and counseling companies. Some are very expensive, some disreputable. You can usually improve your credit score on your own. It takes a little effort but is worth every minute, and it’s free.

Feel free to contact me if you have any questions.

Red Flag for Foreign Nationals buying Real Estate in the US

We have a lot of Canadian buyers in our real estate market right now. As a matter of fact, there are buyers from myriad of different locations. Obviously these people know a great deal when they see one. However, it is not uncommon for foreign nationals to find their great deal turned into a big disappointment when they misinterpret U.S. government regulations. Heck, most Americans don't understand U.S. government regulations. Often real estate agents are unaware, and as a result they put themselves and their buyers in an awkward position.

Let me clear up once such misconception that's been popping up a lot lately. A foreign national may certainly own multiple properties in the U.S., however, only one of those properties can be financed. The fine print in this regulation is where it gets sticky. The regulation states that a foreign national may not obtain a mortgage if they already own another property here. Which means that if they are at any time, considering financing a home in the US, it must be the FIRST one they buy.

Let me say that again, just so we're clear:  If a foreign national intends to finance a property in the U.S, it MUST BE THE FIRST ONE THEY BUY!

I am anticipating your question.. and my answer is "I don't know". I have no idea why this regulation is in place, just please understand that it is. And REALTORS® advise your clients well in advance so that you don't find yourself on the loosing end of a great deal.