Georgia Mortgage FHA

Posts Tagged ‘Real Estate’

I can’t say it any better than my friend Jennifer Fivelsdal “Just a few years ago it was not uncommon to see a house assessed at $200,000 selling for $400,000 and this made home sellers happy.  That was a market called a Seller’s Market, in other words more buyers and fewer properties.  The well known rule of supply and demand dictates that a higher demand with a limited supply will result in higher prices.  Today the scenario is so different.  Very high inventory and few buyers makes this a Buyer’s Market. In this case buyers want to spend less and get much more for their money.”

We are very much, for almost every market, in a buyer’s market. More now than ever before many sellers are having to short sell their home or bring cash to closing to pay the difference between the sales price and the mortgage pay off. To be sure a home seller may want to have their home appraised independently. While that appraisal cannot be used by the buyer’s lender due to all sorts of rules and regulations it should still be a standard, Uniform Appraisal and the result should be within a few percentage points. If you are in the Atlanta area I can give you the names of a few Atlanta area Georgia licensed appraisers.

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Community Outreach Leader and Licensed Loan Officer NMLS ID 208452 - office address 2300 Windy Ridge, Atlanta GA, 30339

— Ken Cook NMLS ID 208452

June 14, 2010   04:37 PM

Representative Thomas Price
U.S. House of Representatives
424 Cannon House Office Building
Washington, DC 20515-0001

Subject: Renew Critical Housing Programs: NFIP and RHS

Dear Representative Price,

Congress left for the Memorial Day recess, leaving two critical housing programs unauthorized or unfunded. On May 31, authority for the National Flood Insurance Program (NFIP) expired. Lenders have stopped accepting applications for the Section 502 rural housing program, which has exhausted its funding. Read the rest of this entry »

Community Outreach Leader and Licensed Loan Officer NMLS ID 208452 - office address 2300 Windy Ridge, Atlanta GA, 30339

— Ken Cook NMLS ID 208452

Blog posts are generally best when timeless but this one should serve as a reminder to those who waited … and waited too long. For several months it has been told, reported and spread that interest rates would approach or hit another all time low while housing prices continued to be low and inventory continued to be high.

That time is now.

The truth is it is always a “good time to buy” especially when you are moving to a new city, upsizing, downsizing, or simply upgrading. The deeper truth is some times are better times to buy than others. Take the strawberry for example.

A few days ago I stopped in the local market to pick up some bread and meat and in the entrance there was a large display of bright red strawberries. It looked to be quite literally millions of them. They were loose and prepackaged in containers of various sizes all the way up to a “banana box” carton. This is the first time I have ever seen that many strawberries in that particular market.

Not only were there so many strawberries but the people were all over them. It was like a fire sale at the dollar store with bags and buggies and moms, dads and others looking over the display and taking them away swiftly. In fact there was a stock cart also filled with them sitting just a few feet away presumably to restock as needed. It looked as if it would be needed soon!

Most interesting was the price – 3 pints for $4. Now I’m not sure if that is a good price in your area but in our area it’s normally $5 for 1 pint. Obviously, even if you are really bad with the math, this is a tremendous bargain. In fact so tremendous one would imagine a lot of those packages going home will not be consumed in time and some will even go to waste.

The housing market right now is like those strawberries.

There is a huge amount of inventory and many professionals speak regularly of “shadow inventory”. It is said there are as many as a million or more homes which are simply not on the market right now because it may be more profitable to wait until the market recovers to list and sell. Maybe so. If that is accurate it only means the inventory levels will be high a little longer.

Top the overstock inventory with the very real fact that interest rates are the lowest they have been and you have a win win situation for any buyer.

I can say this about every commodity: the best time to buy is when others are having a difficult time selling. Overstocks (harvest time) and cheap money could absolutely make this the best time to buy in our lifetimes.

Community Outreach Leader and Licensed Loan Officer NMLS ID 208452 - office address 2300 Windy Ridge, Atlanta GA, 30339

— Ken Cook NMLS ID 208452

Actually this should be title “How to kill your chance of closing on time” or “How to sabotage your own home purchase or refinance”. Then again this is the short, short list of a long list of things you can do to bring your loan process to a screeching halt.

Be reminded of the number of people who put a lot of effort in your loan to get it to the closing table. In fact from my office door right now I can see four full-time people who work behind the scenes on every loan. I can see the set-up person, the processor, the compliance officer and the underwriting department supervisor. That doesn’t include your insurance company and the people who touch the policy there, the agents and all the people in their employment who work on your file, the appraiser, inspector, title office and all the people who are involved in working on your file and others. When you do not close all of the work of all of those people is for nothing. That time could have been invested in someone who doesn’t do the things we are talking about today.

Over the years I have seen a lot of reasons for people to be denied a loan after then have been pre-qualified and before they close. Everything from quitting their job to buying a new boat to something as simple as applying for a student loan and being approved. Here is the rule of thumb:

From the time you are pre-approved to the time you have your keys and paperwork in your hands plus about 90 days do not apply for any credit, quit your job, spend your saving, cash out your 401K, co-sign with someone on a loan, or anything else with your money or your credit. Think I’m kidding? I’ve seen it happen no less than two dozen times in the last few years.

Hopefully you are working with a loan officer who knows how to properly instruct you at the time of application or pre-approval and who knows how to accurately answer your questions about changes in employment, income, savings, or credit. If not call me and I’ll find one for you. I know loan officers in almost every state. Now get some popcorn and enjoy this brief video

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Community Outreach Leader and Licensed Loan Officer NMLS ID 208452 - office address 2300 Windy Ridge, Atlanta GA, 30339

— Ken Cook NMLS ID 208452

With thousands of new homes entering the foreclosure process every month in each market area the question arises ever more frequently, “Can I use an FHA loan to purchase a short sale property?”

For the readers not familiar with short sales let us first define the term as it applies to real estate. As “short sale” on real estate is when the existing lien holder(s) agree to accept a lower amount than is currently owed on the existing loan(s).

If you need an example suppose the home owner has only one mortgage for $350,000 (existing payoff) on a home. Perhaps that home is currently valued only at $275,000. The home owner cannot refinance, the lender has failed to modify and foreclosure is looming so the lender agrees to accept a sales price equal to the current appraised value even though it is a full $75,000 lower than (short of) the payoff.

Answering the question, “can an FHA loan be used to purchase a short sale”, really is too simple. The answer is “yes” provided the property and transaction fall within FHA insurance guidelines. Remember FHA has maximum loan amounts, guidelines for property type and guidelines for property use.

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— Ken Cook NMLS ID 208452

Buying a first home, even buying any home, can be a nerve racking and tedious adventure. As with anything else experience is the best teacher but short articles on blogs can help, too! Obviously it is not possible within a few lines of text to provide an in-depth education and exposition of the process of buying a first home. However a few short pointers of do’s and do not’s can be highly valuable. Follow that up with a contact form and you will be well on your way! Read the rest of this entry »

Community Outreach Leader and Licensed Loan Officer NMLS ID 208452 - office address 2300 Windy Ridge, Atlanta GA, 30339

— Ken Cook NMLS ID 208452

Continuing the great and enlightening discussion on the topic of short sales it has come time for the bane of the web: a poll. Actually polls are not the bane of the web but they are also usually skewed and completely unscientific when used in this manner. However, which is the same as but, your opinion and perspective is invited on this particular matter.

Having taught and “done” short sales for a number of years, in fact well before they were one of the biggest buzz-words in the industry, I have had the chance to work with many agents, sellers, buyer, banks, and lenders in multiple aspects of the process. Still there are “gaps” in understanding, approach and even the timing of a short sale. Moreover, and more personally important to me as the lender offering financing to people who are purchasing short sales, the timing of when a property officially becomes a short sale. Read the rest of this entry »

— Ken Cook NMLS ID 208452

You have almost certainly heard the phrase “short sale” over the last several months. As the nation’s housing market imploded and millions of people began falling behind on their mortgage payments and started facing foreclosure short sales have become much more popular. Many “short sales experts” began showing up around 2007 who had not even heard the term until the attended a class or read an article by someone who may have been familiar with short sales for many years.

Opportunity also breeds scams and the short sales opportunity almost immediately saw hundreds of websites come into existence claiming to be part of a “Government Loan Modification Program”. If you are facing foreclosure and you are searching for help online be warned -- NEVER pay anyone upfront for help avoiding foreclosure or to negotiate a short sale for you. NEVER assign your deed or sign a contract giving another party control of your property. Consult a reputable personal asset protection attorney in your area and ask them how much experience they have had with short sales. The same goes for any real estate agent who says they have short sale experience.

Almost every lender will “consider” a short sale. If you are a home buyer or a buyer’s agent looking at a “short sale listing” the very first question to ask is “has the short sale been approved at a specific dollar amount?” If it has then you have a short sale and you should make your offer based on that knowledge. However, if the answer is “the short sale has been approved and they will consider offers” then it is not a short sale. It is a listing for a home for sale with the possibility of negotiating a short sale.

If the short sale has not been approved to a specific dollar value plan on 45 to 180 days of negotiating. If the short sale has been approved to a specific dollar value and you want to offer less than that amount ditto.

— Ken Cook NMLS ID 208452