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Military Homeowners To Get Short Sale Assistance

Short Sale Policy Information for Military Homeowners

Federal Housing Finance Agency (FHFA) acting director, Edward DeMarco, announced short sale policy changes for active-duty military homeowners.

With this new set of rules, military homeowners can now short sale their homes without having to take a loss. This means they will be free from any deficiency judgments— no cash contribution or promissory note at closing. Plus, they don’t have to default on their loans to qualify.

This policy applies to military homeowners with Permanent Change of Station (PCS) order whose mortgage is backed by Fannie Mae or Freddie Mac. Furthermore, the home must have been bought on or before June 30, 2012.

PCS orders usually require a quick move. This creates hardship for military homeowners who are underwater but couldn’t sell their homes without significant losses. FHFA developed this new policy to provide military homeowners with access to immediate and automatic full range of foreclosure alternatives.

Extending short sale assistance to men and women serving in the armed forces is in the best interest of everyone as they would be able to focus more in their duties to defend the country, rather than worry about the maintenance and leasing of a property in another jurisdiction.

Last year, PCS orders have been considered a qualified hardship for forbearance and loan modifications by Fannie and Freddie.

Other Articles to Read:

Why it is Important to Understand the Short Sale Process

3 mistakes to avoid when short selling your Gainesville home

Gainesville Short Sale Agents Rent To Buy Scheme

Determining if you have a Financial Hardship

Call Stephanie Anson today at 352-260-0153 for a confidential phone interview regarding your options.

Please seek legal advice. This information is for informational purposes only.

Contact Stephanie Anson, CLHMS, CDPE, SFR, Realtor®, Anson Properties LLC. Licensed Realtors® in Florida at 352-260-0153 to list your property for sale or to purchase a property in Gainesville, Archer, Alachua, High Springs, Waldo, Keystone Heights, Hawthorne, Melrose, Cross Creek, LaCrosse, Williston, Earlton, Ocala, Micanopy, Newberry, Kanapaha, Haile Plantation, Duck Pond and the rest of Alachua County Florida, Orange County Florida and Seminole County Florida. We are accepting referrals. Gainesville Short Sale Agents

  

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Determining If You Have A Financial Hardship

Determining If You Have A Financial Hardship

The following are crucial questions that determine the presence of a financial hardship:

1. Why do you need to short sale?
2. Did you try to get a loan modification from your lender? If yes, how did it go?
3. Why was your loan modification turned down?
4. Have you tried to work out a deed in lieu?
5. If yes, what was the outcome?
6. If this is your primary residence, how long have you lived there?
7. Do you live in the property at present?
8. What changes did you make since you got the mortgage on this property?
9. What are your financial hardships?
10. Are you current on your mortgage payments?
11. When was your last payment?

The information provided on the short sale documents should be consistent with that of the loan modification documents, unless verifiable circumstances have changed.

The seller’s commitment to go all the way through with the short sale process is very crucial. Make them understand that the less of a hardship they have, the more contributions they will be required in a form of cash, promissory note, or both. Your efforts will serve futile should they refuse to contribute in the end.

Other Articles to Read:

Gainesville Florida Renter Rights During Foreclosure

Choosing the Best Offer for Gainesville Short Sales

Do I Have to Pay for the Real Estate Agents Commission?

Call Stephanie Anson today at 352-260-0153 for a confidential phone interview regarding your options.

Please seek legal advice. This information is for informational purposes only.

Contact Stephanie Anson, CLHMS, CDPE, SFR, Realtor®, Anson Properties LLC. Licensed Realtors® in Florida at 352-260-0153 to list your property for sale or to purchase a property in Gainesville, Archer, Alachua, High Springs, Waldo, Keystone Heights, Hawthorne, Melrose, Cross Creek, LaCrosse, Williston, Earlton, Ocala, Micanopy, Newberry, Kanapaha, Haile Plantation, Duck Pond and the rest of Alachua County Florida, Orange County Florida and Seminole County Florida. We are accepting referrals. Gainesville Short Sale Agents

  

Avoid Notice of Default – Refinancing Balloon Mortgages

Avoid Notice Of Default – Refinancing Balloon Mortgages – Gainesville Short Sales, What is a balloon mortgage? It is a type of mortgage on which the mature balance is due. Balloon mortgages or loans, aside from the repayment obligation, are somewhat alike to standard fixed-rate mortgages or FRMs.

To better understand this type of loan, let’s say a five-year balloon loan for $100,000 is at 5 percent for a span of 30 years. With the same rate and term, the $537 initial payment would be the same as on an Fixed Rate Mortgage.

The balance of $91,829 on the balloon loan must be repaid after five years. The loan at this point may be refinanced with the existing or another lender or extended at the current market rate.

Balloon mortgages/loans are not that popular in the U.S. unlike in Canada where one-to five-year balloon mortgages have been the standard tool for quite a long time. However, a number of balloon mortgages in the U.S. were written in the years before the financial crisis hit, having balances that will mature in five or seven years, meaning, dues are fast approaching.

Below are some scenarios relevant to balloon mortgages and the action points to take:

Balloon refinancing: Timing is a big issue for those borrowers having balloon mortgages who are eligible to refinance with their current lender or another lender.

Scenario: A balloon payment is about to mature on January 10, 2012 and the borrower tries to refinance with another lender who is consuming much time. The loan might not be closed until the due date on the balloon arrives.

Action point: The lender bearing the balloon will merely charge the borrower with interest for each day the payment is delayed. Frequently update both lenders about the progress.

Refinancing a balloon for underwater homeowners: The borrower having a balloon balance which is greater than the value of the home is facing a more serious situation.

Scenario: The balloon payment is about to mature in December 2012 and the existing balance on the loan is about $150,000. The selling price of the home in today’s market may be at $125,000. Is the lender expected to refinance the mortgage/loan?

Extension of the term at the same rate for five years more will likely be offered. You have the will not to accept the offer if you have difficulty in making payments on this mortgage. Having no other options will compel you to attempt negotiating. You’re direction is to default and this would inflict a big loss on the lender’s end. The best course is to provide you with a refinance.

If necessary, the lender should be willing to relieve your payment problems through loan terms modification. You negotiate on the deal that arises. It will be better to refinance a balance which is about equal to the home’s value. A distinct drop in the interest rate could be your backup. Your lender should perceive that you carry on with two options, refinancing at terms you can afford or acquire a notice of default.

Illustrated below is an example of potential hazard:

A homeowner tried to refinance his first mortgage. He had a second mortgage and paid off $400,000 balance to proceed in taking the second lender’s offer to accept $250,000 as full payment. The homeowner willingly complied believing that it will enable him to refinance his first mortgage. His credit score had been excellent until it was found out that the second mortgage lender had declared to the credit agencies that the transaction and considered paid for less than full balance. As a result, his credit score fell and hindered refinancing of his first mortgage.

Credit score write-downs have been prevalent in mortgage modification programs and even those under the federal Making Home Affordable program are included. The same dilemma is being faced by homeowners with underwater balloon mortgages that are about to mature who choose to take a private modification. One factor that needs to be negotiated on with the lender is how the transaction will be reported to the credit agencies.

No other lender will vouch to refinance an underwater mortgage/loan. The only option is for the existing lender to refinance or else, you will be required to default.

Extension of the term at the same rate for five years more will likely be offered. You have the will not to accept the offer if you have difficulty in making payments on this mortgage. Having no other options will compel you to attempt negotiating. You’re direction is to default and this would inflict a big loss on the lender’s end. The best course is to provide you with a refinance that would allow your payments to continually come and this will help you to eventually pay off the mortgage.

If necessary, the lender should be willing to relieve your payment problems through loan modification. You negotiate on the deal that arises. It will be better to refinance a balance which is about equal to the home’s value. A distinct drop in the interest rate could be your backup. Your lender should perceive that you carry on with two options, refinancing at terms you can afford or going on default.

Other Articles to Read:

Gainesville Florida Foreclosure Fraud Up – Avoid Scams

Gainesville FHA Home Buyers – FHA Fee Hike

Short Selling and Renting from the New Owner – Gainesville Short Sales

Call Stephanie Anson today at 352-260-0153 for a confidential phone interview regarding your options.

Please seek legal advice. This information is for informational purposes only.

Contact Stephanie Anson, CLHMS, CDPE, SFR, Realtor®, Anson Properties LLC. Licensed Realtors® in Florida at 352-260-0153 to list your property for sale or to purchase a property in Gainesville, Archer, Alachua, High Springs, Waldo, Keystone Heights, Hawthorne, Melrose, Cross Creek, LaCrosse, Williston, Earlton, Ocala, Micanopy, Newberry, Kanapaha, Haile Plantation, Duck Pond and the rest of Alachua County Florida, Orange County Florida and Seminole County Florida. We are accepting referrals. Gainesville Short Sale Agents