If you've not already received your 2009-2010 property tax bill, it should be coming soon. You may be busy. You may remember it's close to the amount you paid last time. You may not pay a lot of attention normally because your Realtor, Lender, Tax Preparer or Relative told you it was a write-off anyway. Don't treat it like a utility bill, that's just not the prudent thing to do, carefully review the bill. If you're a new homeowner, take careful note of the due dates to avoid late penalties, among other things. If you are not a new homeowner, you need to be reviewing the tax bill just as carefully but for different reasons.
Here are a list of a few things to be mindful of; however, these are general and may not be all of the things one might be mindful of (I take this opportunity to say "Seek Counsel" should you have any questions or concerns). In no particular order you should:
a) Review the Land assessment and Structure/Improvement assessment and note any changes from the prior year. This is very informational to the new homeowner...to get an understanding of value. This will also help you understand any changes in future years PLUS provide excellent information when making decisions on hazard insurance. Ensure the assigned Full Value is correct whether from a recent purchase price, the normal assessment plus any Prop. 13 increases or any reductions applied for and granted. Note: If you've applied for a permit to improve your property, the County Assessor may have made an adjustment in your taxes;
b) If you qualify, ensure your homeowners exemption is reflected and reduces the basis for the General Levy or if you have qualified in the past, ensure the homeowners exemption has not disappeared. This can happen or been removed because you purchased other property;
c) Check any Mello Roos, Special Assessments or Fixed Charges for accuracy; and
d) If you have transferred your tax basis from property owned in another County, ensure the assessment is correct.
Errors can occur from numerous sources, some intentional based upon actions, assumptions and other from data inputting errors/omissions. These can originate from many sources, i.e. Escrow Company, Title Company, County Recorder, County Assessor, computer glitches....
If you find any inconsistencies or errors you should contact your County Assessor without delay. These types of things are handled best and easiest as soon as they are discovered. Don't think it will be easy to get a credit at a later date.. that's a tough row to hoe and a long one.
Finally, it's a perfect time to consider contacting the Assessor's Office for information relative to a readjustment to your taxes if you believe the value of your Real Estate is less based upon recent sales and current values in your neighborhood. Be prepared to request, download, and complete needs forms to apply; and be mindful that you will need tangible information about comparable sales to support your request for re-assessment. Good Luck and...
Keep the faith!
Sunday, October 25, 2009
Monday, October 19, 2009
Time change tip-better than changing your clock.....
Has your remote control battery ever died just as you got comfy on the sofa in front of your new flat screen and started channel surfing or when you were in bed sick and the last thing you wanted to do was get up and get a new battery??? Do you use your garage keypad to come and go after jogging, quick errands, etc.... and you got a nasty surprise when the batteries died when you were out and you were now stuck??? You can avoid this by using the semi-annual time changes to your benefit.
When you go through the house changing the time on all the clocks, the microwave, the oven, etc...carry a slew of batteries with you, all shapes and sizes. Change any batteries in your alarm clock(s) that act as backup, cruise through the living room, den, great room, office and bedrooms taking care of all the TV, Cable, Satellite, Game Consoles, DVR, VCR, TIVO remotes along with anything else your audio/visual interests may spark. Prudent people might even change batteries in the flashlight(s) in the car/emergency preparedness pack. Following this easy reminder will give you a level of comfort that you'll have good power when you need it. After all, how much fun is searching for batteries in the dark?
p.s. Don't forget to adjust the time for the pool, sprinkler system and landscape lighting.
Keep the faith!
When you go through the house changing the time on all the clocks, the microwave, the oven, etc...carry a slew of batteries with you, all shapes and sizes. Change any batteries in your alarm clock(s) that act as backup, cruise through the living room, den, great room, office and bedrooms taking care of all the TV, Cable, Satellite, Game Consoles, DVR, VCR, TIVO remotes along with anything else your audio/visual interests may spark. Prudent people might even change batteries in the flashlight(s) in the car/emergency preparedness pack. Following this easy reminder will give you a level of comfort that you'll have good power when you need it. After all, how much fun is searching for batteries in the dark?
p.s. Don't forget to adjust the time for the pool, sprinkler system and landscape lighting.
Keep the faith!
Sunday, October 18, 2009
FNMA Credit-A to Z-foreclosure-short sale-Q and A's-This is lengthy-I meant A to Z
One of the concerns a consumer has after experiencing a bankruptcy, foreclosure, or short sale (referred to as a "preforeclosure sale" by Fannie Mae) is the ability to obtain credit to purchase another home. Fannie Mae has updated its credit guidelines. This legal article summarizes those guidelines in Part I. In addition, since lenders use FICO scores in order to determine the creditworthiness of a borrower, this article covers the impact of a bankruptcy, foreclosure or short sale on FICO scores in Part II.
I. Fannie Mae Credit Guidelines
Q 1. How long is the time period after a foreclosure before a consumer can be eligible to obtain credit to purchase a home?
A Five years from the date the foreclosure sale was completed.
Additional requirements that apply after 5 years and up to 7 years following the completion date are as follows:
. The purchase of a principal residence is permitted with a minimum 10 percent down payment and minimum representative credit score of 680.
. Purchase of a second home or investment property is not permitted.
. Limited cash-out refinances are permitted for all occupancy types pursuant to the eligibility requirements in effect at that time.
. Cash-out refinances are not permitted for any occupancy type.
(Source: FNMA Announcement 08-16, 6-25-08 )
Q 2. Why do the additional requirements for foreclosures in Question 1 only apply from 5 to 7 years following the foreclosure completion date?
A According to Fannie Mae policy in Part X, Section 103 of the Selling Guide, Fannie Mae requires only a 7-year history to be reviewed for all credit and public record information. The 7-year time frame also aligns with the information provided by the borrower on the loan application relative to disclosure of a past foreclosure action. (Source: FNMA Selling Guide, 4-1-09. )
Q 3. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the foreclosure?
A Yes. Three years from the date the foreclosure sale was completed. The same additional requirements apply as listed in Question 1 except the minimum credit score of 680 is not required. (Source: FNMA Announcement 08-16, 6-25-08. )
Q 4. What are"extenuating circumstances" ?
A Fannie Mae describes "extenuating circumstances" as follows:
Extenuating circumstances are nonrecurring events that are beyond the borrower's control that result in a sudden, significant, and prolonged reduction in income or a catastrophic increase in financial obligations.
If a borrower claims that derogatory information is the result of extenuating circumstances, the lender must substantiate the borrower's claim. Examples of documentation that can be used to support extenuating circumstances include documents that confirm the event (such as a copy of a divorce decree, medical bills, notice of job layoff, job severance papers, etc.) and documents that illustrate factors that contributed to the borrower's inability to resolve the problems that resulted from the event (such as a copy of insurance papers or claim settlements, listing agreements, lease agreements, tax returns (covering the periods prior to, during, and after a loss of employment), etc.).
The lender must obtain a letter from the borrower explaining the relevance of the documentation. The letter must support the claims of extenuating circumstances, confirm the nature of the event that led to the bankruptcy or foreclosure-related action, and illustrate the borrower had no reasonable options other than to default on their financial obligations.
(Source: FNMA Selling Guide, 4-1-09 at 391. )
Q 5. How long is the time period after a deed-in-lieu of foreclosure before a consumer can be eligible to obtain credit to purchase a property?
A Four years from the date the deed-in-lieu was executed.
Additional requirements that apply after 4 years and up to 7 years following the completion date are as follows:
. Borrower may purchase a property secured by a principal residence, second home, or investment property with the greater of 10 percent minimum down payment or the minimum down payment required for the transaction.
. Limited-cash-out and cash-out refinance transactions secured by a principal residence, second home, or investment property are permitted pursuant to the eligibility requirements in effect at that time.
(Source: FNMA Announcement 08-16, 6-25-08. )
Q 6. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the deed-in-lieu of foreclosure?
A Yes. Two years from the date the deed-in-lieu was executed. The same additional requirements apply as listed in Question 4 after 2 years up to 7 years. (Source: FNMA Announcement 08-16, 6-25-08. )
See Question 4 for the definition of "extenuating circumstances."
Q 7. How long is the time period after a "preforeclosure sale" before a consumer can be eligible to obtain credit to purchase a property?
A Two years from the completion date. No exceptions are permitted to the 2-year period due to extenuating circumstances. (Source: FNMA Announcement 08-16, 6-25-08. )
Q 8. What is a "preforeclosure sale" mentioned in Question 6 and is that the same as a short sale?
A "A preforeclosure sale involves the sale of the property by the borrower to a third party for less than the amount owed to satisfy the delinquent mortgage, as agreed to by the lender, investor, and mortgage insurer" (Source: FNMA Announcement 08-16, 6-25-08 ).
Although the terms preforeclosure sale and short sale have been used interchangeably, there is a significant difference for purposes of obtaining credit. For Fannie Mae purposes, a preforeclosure assumes that the borrower has been delinquent in paying his or her mortgage and the lender agrees to accept a lesser amount to avoid the time and expense of a foreclosure action. A short-sale, however, can also refer to situations in which the lender of the mortgage agrees to a payoff of a lesser amount than is actually owed, even on a current mortgage, to facilitate the sale of the property to a third party. (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )
Q 9. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the preforeclosure (short) sale?
A No. There are no exceptions to the 2-year time period. (Source: FNMA Announcement 08-16, 6-25-08. )
Q 10. If a borrower sold his or her property as a short sale but was never delinquent on that mortgage and is now attempting to purchase a new primary residence, will Fannie Mae purchase the loan?
A The loan will be eligible for delivery to Fannie Mae provided that the borrower's previous mortgage history complies with Fannie Mae's excessive prior mortgage delinquency policy--that is the borrower does not have one or more 60-, 90-, 120-, or 150-day delinquencies reported within the 12 months prior to the credit report date--and the borrower has not entered into any agreement with the short sale lender to repay any amounts associated with the short sale, including a deficiency judgment. (Source: FNMA Announcement 08-16 Q&A, 8-13-08 ; FNMA Selling Guide, Part X, Chapter 3, Section 302.09. .)
Q 11. Are preforeclosure (short) sales and deed-in-lieu of foreclosure actions identified on a credit report?
A Preforeclosure sales may be reported as "paid in full" with a "settled for less than owed" remarks code, and the mortgage trade line would indicate any recent delinquency. A deed-in-lieu may be reported by a remarks code indicating a deed-in-lieu. (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )
Q 12. How long is the time period after a bankruptcy (all except Chapter 13) before a consumer can be eligible to obtain credit to purchase a property?
A Four years from the discharge or dismissal date of the bankruptcy action (Source: FNMA Announcement 08-16, 6-25-08 ).
Q 13. How long is the time period after a Chapter 13 bankruptcy before a consumer can be eligible to obtain credit to purchase a property?
A Two years from the discharge date and four years from the dismissal date (Source: FNMA Announcement 08-16, 6-25-08 ).
Q 14. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the bankruptcy (all actions)?
A Yes. Two years from the discharge or dismissal; however, no exceptions are permitted to the 2-year time period after a Chapter 13 discharge (Source: FNMA Announcement 08-16, 6-25-08 ).
See Question 4 for the definition of "extenuating circumstances."
Q 15. How long is the time period after multiple bankruptcy filings before a consumer can be eligible to obtain credit to purchase a property?
A Five years from the most recent dismissal or discharge date for borrowers with more than one bankruptcy filing within the past 7 years (Source: FNMA Announcement 08-16, 6-25-08 ).
Q 16. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the multiple bankruptcies?
A Yes. Three years from the most recent discharge or dismissal date. The most recent bankruptcy filing must have been the result of extenuating circumstances. (Source: FNMA Announcement 08-16, 6-25-08. )
See Question 4 for the definition of "extenuating circumstances."
Q 17. What is the difference between a Chapter 13 bankruptcy and a Chapter 7 bankruptcy?
A Chapter 13 permits a borrower with a regular income to propose a plan to repay some or all of his or her obligations over a period of up to five years. A borrower who files a Chapter 7 is permitted to retain exempt assets and receive a discharge of the borrower's debts. Chapter 7 is a relatively quick liquidation process that is generally completed within 120 days. Chapter 7 cases are rarely dismissed. (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )
Q 18. What is the difference between a Chapter 13 dismissal and a Chapter 13 discharge?
A A borrower who files a Chapter 13 can dismiss the case at any time (voluntary dismissal) or the case may be dismissed by the court based on the borrower's failure to comply with the requirements of the Bankruptcy Code or to make the required payments. If the borrower who files a Chapter 13 case makes all of the payments required by the plan, the borrower receives a discharge at the end of the plan. A borrower who doesn't make all the payment required by the plan may still receive a discharge if the court finds, among other things, that the borrower made a certain amount of the payments and the borrower's failure to make all of the payments was due to circumstances beyond the borrower's control. (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )
Q 19. What are the requirements to re-establish a credit history?
A After a bankruptcy or foreclosure-related action, a credit history must meet the following requirements to be considered re-established:
. It must meet the requirements for elapsed time (as discussed in this article.
. It must reflect that all accounts are current as of the date of the mortgage application.
. it must include a minimum of four credit references. At least one of the references must be a traditional credit reference, and one of the references must be housing-related.
A housing-related reference must cover the period following the bankruptcy discharge or dismissal, foreclosure, or deed-in-lieu, and can be in the form of mortgage payments or rental payments.
If rental payments were not reported to the credit repositories, the lender must obtain copies of bank statements, money orders, or canceled checks for the most recent 12-month period as a supplement to the rent verification.
. It must reflect three of the four credit references, including rental housing references, as active in the 24 months preceding the date of the mortgage application.
. It must include no more than two installment or revolving debt payments 30 days past due in the last 24 months.
. It must include no installment or revolving debt payments 60 or more days past due since the discharge or dismissal of the bankruptcy or the completion of the foreclosure-related action.
. It must include no housing debt payments past due since the discharge or dismissal of the bankruptcy or the completion of the foreclosure-related action.
. It must include no new public records since the discharge or dismissal of the bankruptcy or the completion of the foreclosure-related action. Public records include bankruptcies, foreclosures, deeds-in-lieu, preforeclosure sales, unpaid judgments or collections, garnishments, liens, etc.
(Source: FNMA Selling Guide, 4-1-09 at 392. )
II. Bankruptcy, Foreclosure, and Short Sale and the Impact on a FICO® Score
Q 20. What is a FICO® Score?
A A FICO® score is a number representing the creditworthiness of a person or the likelihood that person will pay his or her debts. The three credit reporting agencies, Equifax, Experian, and TransUnion, collect data about consumers in order to compile credit reports. The credit agencies use FICO® software to generate FICO® scores, which are then sold to lenders. Actually FICO® is just one of the several credit scoring systems available. The Fair Isaac Corporation (known as FICO®) created the first credit scoring system in 1958. Others are NextGen, VantageScore, and the CE Score. They all evaluate the creditworthiness of a borrower. However, FICO appears to be the most-used credit scoring system. A FICO® score is between 300 and 850. The higher the better the credit.
Each consumer has three credit scores at any given time for any given scoring model because the three credit agencies have their own databases, gather reports from different creditors, and receive information from creditors at different times.
Q 21. What factors go into determining a FICO® score?
A Credit scores are designed to measure the risk of default by taking into account various factors in a person's financial history. Although the exact formulas for calculating credit scores are closely-guarded secrets, FICO® has disclosed the following components and the approximate weighted contribution of each:
35% — Payment History – Late payments on bills, such as a mortgage, credit card or automobile loan, can cause a consumer’s FICO® score to drop. Paying bills as agreed over time will improve a consumer’s FICO® score.
30% — Credit Utilization - The ratio of current revolving debt (such as credit card balances) to the total available revolving credit (credit limits). Consumers can improve their FICO® scores by paying off debt and lowering their utilization ratio. The closing of existing revolving accounts will typically adversely affect this ratio and therefore have a negative impact on their FICO® score.
15% — Length of Credit History – As consumer’s credit history ages, assuming they pay their bills, it can have a positive impact on their FICO® score.
10% — Types of Credit Used (installment, revolving, consumer finance) – Consumers can benefit by having a history of managing different types of credit.
10% — Recent search for credit and/or amount of credit obtained recently - Multiple credit inquiries for a consumer seeking to open new credit, such as credit cards, retail store accounts, and personal loans, can hurt an individual’s score. Applying for lots of new credit in a short period of time is also viewed as risky and can cause a drop in an individual’s score. However, individuals shopping for a mortgage or auto loan over a short period will likely not experience a decrease in their scores as a result of these types of inquiries.
(Source: http://www.myfico.com/CreditEducation/WhatsInYourScore.aspx)
Q 22. How does a mortgage modification affect my FICO® score?
A FICO® credit scores are calculated from the information in consumer credit reports. Whether a loan modification affects the borrower's FICO® score depends on whether and how the lender chooses to report the event to the credit bureau, as well as on the person's overall credit profile. If a lender indicates to a credit bureau that the consumer has not made payments on a mortgage as originally agreed, that information on the consumer's credit report could cause the consumer's FICO® score to decrease or it could have little to no impact on the score.
(Source: http://www.myfico.com/crediteducation/questions/Mortgage_Modification.aspx)
Q 23. How does a bankruptcy affect my FICO® score?
A A bankruptcy is considered a very negative event regardless of the type. A bankruptcy is factored into your FICO® score until it is removed from your credit report. As long as the bankruptcy is listed on your credit report, it will be factored into your score. If you are considering bankruptcy as an alternative to foreclosure, keep in mind that it may have a greater impact on your FICO® score.
Typically, you can expect bankruptcies to remain on your credit report, from the date filed, as follows:
(1) Chapter 11 and Chapter 7 bankruptcies up to 10 years.
(2) Completed Chapter 13 bankruptcies up to 7 years.
These time periods refer to the public record item associated with filing for bankruptcy. All of the individual accounts included in the bankruptcy should be removed from your credit report after 7 years. (Source: http://www.myfico.com/crediteducation/Questions/Bankruptcy-Types.aspx)
If you plan to file a bankruptcy, here are some things you should do to make sure your creditors are accurately reporting the bankruptcy filing:
(1) Check your credit report to ensure that accounts that were not part of the bankruptcy filing are not being reported with a bankruptcy status.
(2) Make sure your bankruptcy is removed as soon as it is eligible to be "purged" from your credit report.
After a bankruptcy has been filed, the sooner you begin re-establishing credit in good standing, the sooner you can expect your FICO® score to rebound. A good practice is to obtain a secured credit card and continually make all of your payments on time. As time passes and the impact of the bankruptcy lessens, you might apply for a traditional credit card and also continually make all of your payments on time.
(Source: http://www.myfico.com/crediteducation/questions/Bankruptcy-Reach.aspx)
Q 24. How does a short sale, deed-in-lieu-of foreclosure. or a foreclosure affect my FICO® score?
A The alternatives to foreclosure, such as a deed-in-lieu of foreclosure or a short sale, aren’t any better as far as a FICO® score is concerned.
The common alternatives to foreclosure, such as short sales, and deeds-in-lieu of foreclosure are all "not paid as agreed" accounts, and considered the same by your FICO® score. This is not to say that these may not be better options for you from a financial or tax perspective, just that they will be considered no better or worse for your FICO® score.
If you are considering bankruptcy as an alternative to foreclosure, that may have a greater impact on your FICO® score. While a foreclosure is a single account that you default on, declaring bankruptcy has the opportunity to affect multiple accounts and therefore has potential to have a greater negative impact on your FICO® score.
(Source: http://www.myfico.com/CreditEducation/Questions/foreclosure-alternatives-fico-score.aspx)
Q 25. What won't affect my FICO® score?
A The following information is not considered by the FICO® scoring formula:
. Your race, color, religion, national origin, sex, or marital status
. Your age
. Your salary, occupation, title, employer, date employed, or employment history
. Where you live
. Any interest rate being charged on a particular credit card or other account
. Certain types of inquiries (such as promotional, account review, insurance or employment-related inquiries)
. Credit counseling
. Any information not found in your credit report
. Any information that is not proven to be predictive of future credit performance
(Source: http://myfico.custhelp.com/cgi-bin/myfico.cfg/php/enduser/std_adp.php?p_faqid=55)
This information has been provided courtesy of the California Association of Realtors
Keep the faith!
I. Fannie Mae Credit Guidelines
Q 1. How long is the time period after a foreclosure before a consumer can be eligible to obtain credit to purchase a home?
A Five years from the date the foreclosure sale was completed.
Additional requirements that apply after 5 years and up to 7 years following the completion date are as follows:
. The purchase of a principal residence is permitted with a minimum 10 percent down payment and minimum representative credit score of 680.
. Purchase of a second home or investment property is not permitted.
. Limited cash-out refinances are permitted for all occupancy types pursuant to the eligibility requirements in effect at that time.
. Cash-out refinances are not permitted for any occupancy type.
(Source: FNMA Announcement 08-16, 6-25-08 )
Q 2. Why do the additional requirements for foreclosures in Question 1 only apply from 5 to 7 years following the foreclosure completion date?
A According to Fannie Mae policy in Part X, Section 103 of the Selling Guide, Fannie Mae requires only a 7-year history to be reviewed for all credit and public record information. The 7-year time frame also aligns with the information provided by the borrower on the loan application relative to disclosure of a past foreclosure action. (Source: FNMA Selling Guide, 4-1-09. )
Q 3. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the foreclosure?
A Yes. Three years from the date the foreclosure sale was completed. The same additional requirements apply as listed in Question 1 except the minimum credit score of 680 is not required. (Source: FNMA Announcement 08-16, 6-25-08. )
Q 4. What are"extenuating circumstances" ?
A Fannie Mae describes "extenuating circumstances" as follows:
Extenuating circumstances are nonrecurring events that are beyond the borrower's control that result in a sudden, significant, and prolonged reduction in income or a catastrophic increase in financial obligations.
If a borrower claims that derogatory information is the result of extenuating circumstances, the lender must substantiate the borrower's claim. Examples of documentation that can be used to support extenuating circumstances include documents that confirm the event (such as a copy of a divorce decree, medical bills, notice of job layoff, job severance papers, etc.) and documents that illustrate factors that contributed to the borrower's inability to resolve the problems that resulted from the event (such as a copy of insurance papers or claim settlements, listing agreements, lease agreements, tax returns (covering the periods prior to, during, and after a loss of employment), etc.).
The lender must obtain a letter from the borrower explaining the relevance of the documentation. The letter must support the claims of extenuating circumstances, confirm the nature of the event that led to the bankruptcy or foreclosure-related action, and illustrate the borrower had no reasonable options other than to default on their financial obligations.
(Source: FNMA Selling Guide, 4-1-09 at 391. )
Q 5. How long is the time period after a deed-in-lieu of foreclosure before a consumer can be eligible to obtain credit to purchase a property?
A Four years from the date the deed-in-lieu was executed.
Additional requirements that apply after 4 years and up to 7 years following the completion date are as follows:
. Borrower may purchase a property secured by a principal residence, second home, or investment property with the greater of 10 percent minimum down payment or the minimum down payment required for the transaction.
. Limited-cash-out and cash-out refinance transactions secured by a principal residence, second home, or investment property are permitted pursuant to the eligibility requirements in effect at that time.
(Source: FNMA Announcement 08-16, 6-25-08. )
Q 6. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the deed-in-lieu of foreclosure?
A Yes. Two years from the date the deed-in-lieu was executed. The same additional requirements apply as listed in Question 4 after 2 years up to 7 years. (Source: FNMA Announcement 08-16, 6-25-08. )
See Question 4 for the definition of "extenuating circumstances."
Q 7. How long is the time period after a "preforeclosure sale" before a consumer can be eligible to obtain credit to purchase a property?
A Two years from the completion date. No exceptions are permitted to the 2-year period due to extenuating circumstances. (Source: FNMA Announcement 08-16, 6-25-08. )
Q 8. What is a "preforeclosure sale" mentioned in Question 6 and is that the same as a short sale?
A "A preforeclosure sale involves the sale of the property by the borrower to a third party for less than the amount owed to satisfy the delinquent mortgage, as agreed to by the lender, investor, and mortgage insurer" (Source: FNMA Announcement 08-16, 6-25-08 ).
Although the terms preforeclosure sale and short sale have been used interchangeably, there is a significant difference for purposes of obtaining credit. For Fannie Mae purposes, a preforeclosure assumes that the borrower has been delinquent in paying his or her mortgage and the lender agrees to accept a lesser amount to avoid the time and expense of a foreclosure action. A short-sale, however, can also refer to situations in which the lender of the mortgage agrees to a payoff of a lesser amount than is actually owed, even on a current mortgage, to facilitate the sale of the property to a third party. (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )
Q 9. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the preforeclosure (short) sale?
A No. There are no exceptions to the 2-year time period. (Source: FNMA Announcement 08-16, 6-25-08. )
Q 10. If a borrower sold his or her property as a short sale but was never delinquent on that mortgage and is now attempting to purchase a new primary residence, will Fannie Mae purchase the loan?
A The loan will be eligible for delivery to Fannie Mae provided that the borrower's previous mortgage history complies with Fannie Mae's excessive prior mortgage delinquency policy--that is the borrower does not have one or more 60-, 90-, 120-, or 150-day delinquencies reported within the 12 months prior to the credit report date--and the borrower has not entered into any agreement with the short sale lender to repay any amounts associated with the short sale, including a deficiency judgment. (Source: FNMA Announcement 08-16 Q&A, 8-13-08 ; FNMA Selling Guide, Part X, Chapter 3, Section 302.09. .)
Q 11. Are preforeclosure (short) sales and deed-in-lieu of foreclosure actions identified on a credit report?
A Preforeclosure sales may be reported as "paid in full" with a "settled for less than owed" remarks code, and the mortgage trade line would indicate any recent delinquency. A deed-in-lieu may be reported by a remarks code indicating a deed-in-lieu. (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )
Q 12. How long is the time period after a bankruptcy (all except Chapter 13) before a consumer can be eligible to obtain credit to purchase a property?
A Four years from the discharge or dismissal date of the bankruptcy action (Source: FNMA Announcement 08-16, 6-25-08 ).
Q 13. How long is the time period after a Chapter 13 bankruptcy before a consumer can be eligible to obtain credit to purchase a property?
A Two years from the discharge date and four years from the dismissal date (Source: FNMA Announcement 08-16, 6-25-08 ).
Q 14. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the bankruptcy (all actions)?
A Yes. Two years from the discharge or dismissal; however, no exceptions are permitted to the 2-year time period after a Chapter 13 discharge (Source: FNMA Announcement 08-16, 6-25-08 ).
See Question 4 for the definition of "extenuating circumstances."
Q 15. How long is the time period after multiple bankruptcy filings before a consumer can be eligible to obtain credit to purchase a property?
A Five years from the most recent dismissal or discharge date for borrowers with more than one bankruptcy filing within the past 7 years (Source: FNMA Announcement 08-16, 6-25-08 ).
Q 16. Does a shorter time period apply if the borrower has "extenuating circumstances" that led to the multiple bankruptcies?
A Yes. Three years from the most recent discharge or dismissal date. The most recent bankruptcy filing must have been the result of extenuating circumstances. (Source: FNMA Announcement 08-16, 6-25-08. )
See Question 4 for the definition of "extenuating circumstances."
Q 17. What is the difference between a Chapter 13 bankruptcy and a Chapter 7 bankruptcy?
A Chapter 13 permits a borrower with a regular income to propose a plan to repay some or all of his or her obligations over a period of up to five years. A borrower who files a Chapter 7 is permitted to retain exempt assets and receive a discharge of the borrower's debts. Chapter 7 is a relatively quick liquidation process that is generally completed within 120 days. Chapter 7 cases are rarely dismissed. (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )
Q 18. What is the difference between a Chapter 13 dismissal and a Chapter 13 discharge?
A A borrower who files a Chapter 13 can dismiss the case at any time (voluntary dismissal) or the case may be dismissed by the court based on the borrower's failure to comply with the requirements of the Bankruptcy Code or to make the required payments. If the borrower who files a Chapter 13 case makes all of the payments required by the plan, the borrower receives a discharge at the end of the plan. A borrower who doesn't make all the payment required by the plan may still receive a discharge if the court finds, among other things, that the borrower made a certain amount of the payments and the borrower's failure to make all of the payments was due to circumstances beyond the borrower's control. (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )
Q 19. What are the requirements to re-establish a credit history?
A After a bankruptcy or foreclosure-related action, a credit history must meet the following requirements to be considered re-established:
. It must meet the requirements for elapsed time (as discussed in this article.
. It must reflect that all accounts are current as of the date of the mortgage application.
. it must include a minimum of four credit references. At least one of the references must be a traditional credit reference, and one of the references must be housing-related.
A housing-related reference must cover the period following the bankruptcy discharge or dismissal, foreclosure, or deed-in-lieu, and can be in the form of mortgage payments or rental payments.
If rental payments were not reported to the credit repositories, the lender must obtain copies of bank statements, money orders, or canceled checks for the most recent 12-month period as a supplement to the rent verification.
. It must reflect three of the four credit references, including rental housing references, as active in the 24 months preceding the date of the mortgage application.
. It must include no more than two installment or revolving debt payments 30 days past due in the last 24 months.
. It must include no installment or revolving debt payments 60 or more days past due since the discharge or dismissal of the bankruptcy or the completion of the foreclosure-related action.
. It must include no housing debt payments past due since the discharge or dismissal of the bankruptcy or the completion of the foreclosure-related action.
. It must include no new public records since the discharge or dismissal of the bankruptcy or the completion of the foreclosure-related action. Public records include bankruptcies, foreclosures, deeds-in-lieu, preforeclosure sales, unpaid judgments or collections, garnishments, liens, etc.
(Source: FNMA Selling Guide, 4-1-09 at 392. )
II. Bankruptcy, Foreclosure, and Short Sale and the Impact on a FICO® Score
Q 20. What is a FICO® Score?
A A FICO® score is a number representing the creditworthiness of a person or the likelihood that person will pay his or her debts. The three credit reporting agencies, Equifax, Experian, and TransUnion, collect data about consumers in order to compile credit reports. The credit agencies use FICO® software to generate FICO® scores, which are then sold to lenders. Actually FICO® is just one of the several credit scoring systems available. The Fair Isaac Corporation (known as FICO®) created the first credit scoring system in 1958. Others are NextGen, VantageScore, and the CE Score. They all evaluate the creditworthiness of a borrower. However, FICO appears to be the most-used credit scoring system. A FICO® score is between 300 and 850. The higher the better the credit.
Each consumer has three credit scores at any given time for any given scoring model because the three credit agencies have their own databases, gather reports from different creditors, and receive information from creditors at different times.
Q 21. What factors go into determining a FICO® score?
A Credit scores are designed to measure the risk of default by taking into account various factors in a person's financial history. Although the exact formulas for calculating credit scores are closely-guarded secrets, FICO® has disclosed the following components and the approximate weighted contribution of each:
35% — Payment History – Late payments on bills, such as a mortgage, credit card or automobile loan, can cause a consumer’s FICO® score to drop. Paying bills as agreed over time will improve a consumer’s FICO® score.
30% — Credit Utilization - The ratio of current revolving debt (such as credit card balances) to the total available revolving credit (credit limits). Consumers can improve their FICO® scores by paying off debt and lowering their utilization ratio. The closing of existing revolving accounts will typically adversely affect this ratio and therefore have a negative impact on their FICO® score.
15% — Length of Credit History – As consumer’s credit history ages, assuming they pay their bills, it can have a positive impact on their FICO® score.
10% — Types of Credit Used (installment, revolving, consumer finance) – Consumers can benefit by having a history of managing different types of credit.
10% — Recent search for credit and/or amount of credit obtained recently - Multiple credit inquiries for a consumer seeking to open new credit, such as credit cards, retail store accounts, and personal loans, can hurt an individual’s score. Applying for lots of new credit in a short period of time is also viewed as risky and can cause a drop in an individual’s score. However, individuals shopping for a mortgage or auto loan over a short period will likely not experience a decrease in their scores as a result of these types of inquiries.
(Source: http://www.myfico.com/CreditEducation/WhatsInYourScore.aspx)
Q 22. How does a mortgage modification affect my FICO® score?
A FICO® credit scores are calculated from the information in consumer credit reports. Whether a loan modification affects the borrower's FICO® score depends on whether and how the lender chooses to report the event to the credit bureau, as well as on the person's overall credit profile. If a lender indicates to a credit bureau that the consumer has not made payments on a mortgage as originally agreed, that information on the consumer's credit report could cause the consumer's FICO® score to decrease or it could have little to no impact on the score.
(Source: http://www.myfico.com/crediteducation/questions/Mortgage_Modification.aspx)
Q 23. How does a bankruptcy affect my FICO® score?
A A bankruptcy is considered a very negative event regardless of the type. A bankruptcy is factored into your FICO® score until it is removed from your credit report. As long as the bankruptcy is listed on your credit report, it will be factored into your score. If you are considering bankruptcy as an alternative to foreclosure, keep in mind that it may have a greater impact on your FICO® score.
Typically, you can expect bankruptcies to remain on your credit report, from the date filed, as follows:
(1) Chapter 11 and Chapter 7 bankruptcies up to 10 years.
(2) Completed Chapter 13 bankruptcies up to 7 years.
These time periods refer to the public record item associated with filing for bankruptcy. All of the individual accounts included in the bankruptcy should be removed from your credit report after 7 years. (Source: http://www.myfico.com/crediteducation/Questions/Bankruptcy-Types.aspx)
If you plan to file a bankruptcy, here are some things you should do to make sure your creditors are accurately reporting the bankruptcy filing:
(1) Check your credit report to ensure that accounts that were not part of the bankruptcy filing are not being reported with a bankruptcy status.
(2) Make sure your bankruptcy is removed as soon as it is eligible to be "purged" from your credit report.
After a bankruptcy has been filed, the sooner you begin re-establishing credit in good standing, the sooner you can expect your FICO® score to rebound. A good practice is to obtain a secured credit card and continually make all of your payments on time. As time passes and the impact of the bankruptcy lessens, you might apply for a traditional credit card and also continually make all of your payments on time.
(Source: http://www.myfico.com/crediteducation/questions/Bankruptcy-Reach.aspx)
Q 24. How does a short sale, deed-in-lieu-of foreclosure. or a foreclosure affect my FICO® score?
A The alternatives to foreclosure, such as a deed-in-lieu of foreclosure or a short sale, aren’t any better as far as a FICO® score is concerned.
The common alternatives to foreclosure, such as short sales, and deeds-in-lieu of foreclosure are all "not paid as agreed" accounts, and considered the same by your FICO® score. This is not to say that these may not be better options for you from a financial or tax perspective, just that they will be considered no better or worse for your FICO® score.
If you are considering bankruptcy as an alternative to foreclosure, that may have a greater impact on your FICO® score. While a foreclosure is a single account that you default on, declaring bankruptcy has the opportunity to affect multiple accounts and therefore has potential to have a greater negative impact on your FICO® score.
(Source: http://www.myfico.com/CreditEducation/Questions/foreclosure-alternatives-fico-score.aspx)
Q 25. What won't affect my FICO® score?
A The following information is not considered by the FICO® scoring formula:
. Your race, color, religion, national origin, sex, or marital status
. Your age
. Your salary, occupation, title, employer, date employed, or employment history
. Where you live
. Any interest rate being charged on a particular credit card or other account
. Certain types of inquiries (such as promotional, account review, insurance or employment-related inquiries)
. Credit counseling
. Any information not found in your credit report
. Any information that is not proven to be predictive of future credit performance
(Source: http://myfico.custhelp.com/cgi-bin/myfico.cfg/php/enduser/std_adp.php?p_faqid=55)
This information has been provided courtesy of the California Association of Realtors
Keep the faith!
Thursday, October 15, 2009
Short Sale/Foreclosure - Start fixing your credit right now
So you survived the Short Sale or Foreclosure process and you figure your credit history is toast. You're thinking that might never crawl out of this hole. Well, Stand tall! Ralph Waldo Emerson said it best ~ "Our greatest glory is not in never failing, but in rising up every time we fail." There is hope and with hope comes a need to jump back in the saddle and be proactive because nothing is free or easy in life (we're all experts on that one!).
Beside starting at that familiar step one(saving up for another down payment) the next best thing would be to check what your credit looks like. This can be done quite easily and at no cost. It all starts here...
Locate Internet access and visit http://www.AnnualCreditReport.com
This central site allows you to request a free credit file disclosure, commonly called a credit report, once every 12 months from each of the nationwide consumer credit reporting companies: Equifax, Experian and TransUnion. If you schedule one every four months, you can start monitoring your credit on a regular basis which also allows you to get early tabs on any suspicious activity that might led to Identity Theft.Remember that this is not a substitute for other proven means of protecting your credit, it is merely a free tool to augment your other effort(s).
AnnualCreditReport.com is the official site to help consumers to obtain their free credit report. Exercise caution and ensure you've gotten to the correct site before inputting any information.
Find the words, START HERE. You will be prompted to select the state you are in (I am in California, all of my commentary is related to my experience with free California credit reports solely but I expect the access would be similar), and then click Request Report which will then take you to an area for you to identify yourself by completing the blanks with personal information. Ensure that you check the box to restrict the viewing / printing of you Social Security Number to the last 4 digits only. Clicking next brings you to a page to select one of the companies. After selecting, clicking on next brings you to a page indicating that you selected the particular company. Clicking next takes you to a page of qualifying questions> Proper answers ensure the person entering the information is the actual person or authorized party for which the credit report is being requested. Once you have answered these and clicked next, you will come to an offer of various services available through the respective company, including providing credit scoring. It is your choice but you can refuse by clicking the small designated area {No Thanks} at the bottom. Remember that it's not important to have credit scoring at this point so save your money. Anything else is up to you. Click next ~ You are in!
This is your chance to review all the information at the particular company and dispute any incorrect information, as appropriate. Here's some very general, quick tips...
Once you have a report, you have 30 days within which to view it online. Write down the file or report number, chosen user name and password to ensure you have access.
The first step in reviewing a credit report is to make certain that the information in the file is about you and is correct. Many reports contain information from others with a similar name or similar Social Security number even a transposed number which could have linked to your credit history. Credit reports also should be reviewed for incorrect items, such as credit cards that were never opened or payments made that were never reported. These could lead to Identity theft or improper credit to your account resulting in reports of late payments which damage your credit, not to mention fees.
Sellers who sold their home via a short sale should review their credit report to ensure the account reflects a zero balance rather than the difference between the outstanding balance and the sales price. Do note that a short sale carries no further obligations. Be mindful of the terms you agreed to or the path you chose whether Short Sale or Foreclosure. Some lenders are filing deficiency judgments, while others are selling the debts to investors who then contact borrowers for repayment. If something is inaccurate, now is the time to dispute the reporting, not 2 years from now when you are trying to buy another house.
Make sure that you stay current on all your other loans (Auto, personal, etc...) and your credit cards. Apply for a secured credit card or two and maybe even a small loan. If you can pay it back quickly gives evidence that you are credit worthy and can help to re-establish credit.
In closing, remember to mark your calender in 4 month increments to check your credit reporting history. It makes good business sense for the future of you and your family plus practical sense after you've successfully acquired a new home.
Keep the faith!
Beside starting at that familiar step one(saving up for another down payment) the next best thing would be to check what your credit looks like. This can be done quite easily and at no cost. It all starts here...
Locate Internet access and visit http://www.AnnualCreditReport.com
This central site allows you to request a free credit file disclosure, commonly called a credit report, once every 12 months from each of the nationwide consumer credit reporting companies: Equifax, Experian and TransUnion. If you schedule one every four months, you can start monitoring your credit on a regular basis which also allows you to get early tabs on any suspicious activity that might led to Identity Theft.Remember that this is not a substitute for other proven means of protecting your credit, it is merely a free tool to augment your other effort(s).
AnnualCreditReport.com is the official site to help consumers to obtain their free credit report. Exercise caution and ensure you've gotten to the correct site before inputting any information.
Find the words, START HERE. You will be prompted to select the state you are in (I am in California, all of my commentary is related to my experience with free California credit reports solely but I expect the access would be similar), and then click Request Report which will then take you to an area for you to identify yourself by completing the blanks with personal information. Ensure that you check the box to restrict the viewing / printing of you Social Security Number to the last 4 digits only. Clicking next brings you to a page to select one of the companies. After selecting, clicking on next brings you to a page indicating that you selected the particular company. Clicking next takes you to a page of qualifying questions> Proper answers ensure the person entering the information is the actual person or authorized party for which the credit report is being requested. Once you have answered these and clicked next, you will come to an offer of various services available through the respective company, including providing credit scoring. It is your choice but you can refuse by clicking the small designated area {No Thanks} at the bottom. Remember that it's not important to have credit scoring at this point so save your money. Anything else is up to you. Click next ~ You are in!
This is your chance to review all the information at the particular company and dispute any incorrect information, as appropriate. Here's some very general, quick tips...
Once you have a report, you have 30 days within which to view it online. Write down the file or report number, chosen user name and password to ensure you have access.
The first step in reviewing a credit report is to make certain that the information in the file is about you and is correct. Many reports contain information from others with a similar name or similar Social Security number even a transposed number which could have linked to your credit history. Credit reports also should be reviewed for incorrect items, such as credit cards that were never opened or payments made that were never reported. These could lead to Identity theft or improper credit to your account resulting in reports of late payments which damage your credit, not to mention fees.
Sellers who sold their home via a short sale should review their credit report to ensure the account reflects a zero balance rather than the difference between the outstanding balance and the sales price. Do note that a short sale carries no further obligations. Be mindful of the terms you agreed to or the path you chose whether Short Sale or Foreclosure. Some lenders are filing deficiency judgments, while others are selling the debts to investors who then contact borrowers for repayment. If something is inaccurate, now is the time to dispute the reporting, not 2 years from now when you are trying to buy another house.
Make sure that you stay current on all your other loans (Auto, personal, etc...) and your credit cards. Apply for a secured credit card or two and maybe even a small loan. If you can pay it back quickly gives evidence that you are credit worthy and can help to re-establish credit.
In closing, remember to mark your calender in 4 month increments to check your credit reporting history. It makes good business sense for the future of you and your family plus practical sense after you've successfully acquired a new home.
Keep the faith!
Tuesday, October 13, 2009
ADVANCE FEES NOW ILLEGAL IN CALIFORNIA
ADVANCE FEES FOR LOAN MODIFICATIONS NOW PROHIBITED
On October 11, 2009, Governor Schwarzenegger signed Senate Bill 94 (Calderon), and the legislation took effect immediately upon his signature. Thus, California law now prohibits any person, including real estate licensees and attorneys, from demanding or collecting an advance fee from a consumer for loan modification or mortgage loan forbearance services affecting I - 4 unit residential dwellings.
IF YOU ARE A REAL ESTATE BROKER, OR THE DESIGNATED OFFICER OF A LICENSED CORPORATION WHO HAS BEEN ISSUED A "NO OBJECTION" LETTER BY THE DEPARTMENT OF REAL ESTATE FOR LOAN MODIFICATION OR OTHER MORTGAGE LOAN FORBEARANCE SERVICES, YOU CAN NO LONGER ENTER INTO THESE AGREEMENTS EFFECTIVE AS OF OCTOBER 11, 2009, NOR CAN YOU COLLECT ANY ADVANCE FEES FOR SUCH SERVICES.
Agreements entered into and advance fees collected prior to October 11, 2009 are not affected. Advance fees inadvertently collected after October 11, 2009 must be fully refunded.
For full details on Senate Bill 94, click here: http://www.leginfo.ca.gov/pub/09-10/bill/sen/sb_0051-0100/sb_94_bill_20090910_enrolled.html Keep the faith!
On October 11, 2009, Governor Schwarzenegger signed Senate Bill 94 (Calderon), and the legislation took effect immediately upon his signature. Thus, California law now prohibits any person, including real estate licensees and attorneys, from demanding or collecting an advance fee from a consumer for loan modification or mortgage loan forbearance services affecting I - 4 unit residential dwellings.
IF YOU ARE A REAL ESTATE BROKER, OR THE DESIGNATED OFFICER OF A LICENSED CORPORATION WHO HAS BEEN ISSUED A "NO OBJECTION" LETTER BY THE DEPARTMENT OF REAL ESTATE FOR LOAN MODIFICATION OR OTHER MORTGAGE LOAN FORBEARANCE SERVICES, YOU CAN NO LONGER ENTER INTO THESE AGREEMENTS EFFECTIVE AS OF OCTOBER 11, 2009, NOR CAN YOU COLLECT ANY ADVANCE FEES FOR SUCH SERVICES.
Agreements entered into and advance fees collected prior to October 11, 2009 are not affected. Advance fees inadvertently collected after October 11, 2009 must be fully refunded.
For full details on Senate Bill 94, click here: http://www.leginfo.ca.gov/pub/09-10/bill/sen/sb_0051-0100/sb_94_bill_20090910_enrolled.html Keep the faith!
Sunday, October 11, 2009
JUST CAN'T FIND ENOUGH WAYS TO PROTECT YOURSELF
Put your car keys beside your bed at night
Tell your spouse, your children, your neighbors, your parents,
your Dr's office, the check-out girl at the market, everyone you run across.
Put your car keys - or even the extra key fob - beside your bed at night.
If you hear a noise outside your home or someone trying to get in your house,
just press the panic button for your car. The alarm will be set off, and the horn will continue to sound until either you turn it off or the car battery dies.
Next time you come home for the night and you start to put your keys away,
think of this: It's a security alarm system that you probably already have and requires no installation. Test it.
It will go off from most everywhere inside your house or backyard and will keep honking until your battery runs down or until you reset it with the button on the key fob chain. It should also work whether you park in your driveway or garage.
If your car alarm goes off when someone is trying to break into your house,
odds are the burglar/rapist won't stick around. After a few seconds all the neighbors will be looking out their windows to see who is out there and sure enough the criminal won't want that.
And remember to carry your keys while walking to your car in a parking lot.
The alarm can work the same way there. This is something that should really be shared with everyone. Maybe it could save a life or a sexual abuse crime. Think or yourself, your spouse, your kids, your parents, your Neighbor or a stranger in trouble....
SEND THIS TO EVERYONE YOU KNOW because it's a fantastic and simple idea. Could be useful for any emergency, such as a heart attack, where you can't reach a phone........
Make sure you try it from different areas of the house so you know if it and when it works... You don't have to try it from all spots today or tonight but over a few days- be kind to your neighbors-and then tell them what you did- They'll be very happy you did and so will you.
This tip came from your friendly "Neighborhood Watch Guy" and Desert REALTOR
Keep the faith!
Tell your spouse, your children, your neighbors, your parents,
your Dr's office, the check-out girl at the market, everyone you run across.
Put your car keys - or even the extra key fob - beside your bed at night.
If you hear a noise outside your home or someone trying to get in your house,
just press the panic button for your car. The alarm will be set off, and the horn will continue to sound until either you turn it off or the car battery dies.
Next time you come home for the night and you start to put your keys away,
think of this: It's a security alarm system that you probably already have and requires no installation. Test it.
It will go off from most everywhere inside your house or backyard and will keep honking until your battery runs down or until you reset it with the button on the key fob chain. It should also work whether you park in your driveway or garage.
If your car alarm goes off when someone is trying to break into your house,
odds are the burglar/rapist won't stick around. After a few seconds all the neighbors will be looking out their windows to see who is out there and sure enough the criminal won't want that.
And remember to carry your keys while walking to your car in a parking lot.
The alarm can work the same way there. This is something that should really be shared with everyone. Maybe it could save a life or a sexual abuse crime. Think or yourself, your spouse, your kids, your parents, your Neighbor or a stranger in trouble....
SEND THIS TO EVERYONE YOU KNOW because it's a fantastic and simple idea. Could be useful for any emergency, such as a heart attack, where you can't reach a phone........
Make sure you try it from different areas of the house so you know if it and when it works... You don't have to try it from all spots today or tonight but over a few days- be kind to your neighbors-and then tell them what you did- They'll be very happy you did and so will you.
This tip came from your friendly "Neighborhood Watch Guy" and Desert REALTOR
Keep the faith!
Friday, October 2, 2009
R E Prices need Tax Credit Extension/First-Timers
Everyone who is anyone in Politics, Finance, Economics and especially Real Estate is aware that the current First Time Buyer program is really fueling the Real Estate rebound which is more than decent kindling for the economy, in my opinion. A lot of us have written to our Representatives to let them know out thoughts on the importance of the issue. I've already received a response from Diane Feinstein.
2007 and 2008 saw ever increasing numbers of people buying their first home (as defined by the I.R.S. to be anyone who hasn't owned a home in 3 years). The tax credit incentive caused people to get off the couch and do something. This activity is responsible for generating income which lead to spending - Hmmm - I think that's what we are trying to so here....then, there are the credits themselves. A lot of people have been using the refund to spruce up their new homes and everyone knows that with that comes sales in Audio/Visual, Electronics, Furniture, Appliances, etc.... and maybe some people even paid off the family car, paid off credit card debt or bolstered their reserves for a rainy day. Sure seems like the desired effect is there or coming round the bend. The next step should be two-headed - Rental pricing should start to increase which should lead to more value to Investment Property owners resulting in increased activity in the Income Property market plus those Sellers who were not involved in distressed property sales may well be looking to buy up and those involved in distressed sales with FHA loans securing the properties will be starting to reach their 2 year limit and may again be eligible for an FHA loan. So......How important do you think an extension of the Federal Tax Credit is? There's several bills underway to extend and/or augment the current credit which expires 11-30-09. You might think about contacting your representatives and voicing your opinion. A phonecall or letter for America. Keep the faith!
2007 and 2008 saw ever increasing numbers of people buying their first home (as defined by the I.R.S. to be anyone who hasn't owned a home in 3 years). The tax credit incentive caused people to get off the couch and do something. This activity is responsible for generating income which lead to spending - Hmmm - I think that's what we are trying to so here....then, there are the credits themselves. A lot of people have been using the refund to spruce up their new homes and everyone knows that with that comes sales in Audio/Visual, Electronics, Furniture, Appliances, etc.... and maybe some people even paid off the family car, paid off credit card debt or bolstered their reserves for a rainy day. Sure seems like the desired effect is there or coming round the bend. The next step should be two-headed - Rental pricing should start to increase which should lead to more value to Investment Property owners resulting in increased activity in the Income Property market plus those Sellers who were not involved in distressed property sales may well be looking to buy up and those involved in distressed sales with FHA loans securing the properties will be starting to reach their 2 year limit and may again be eligible for an FHA loan. So......How important do you think an extension of the Federal Tax Credit is? There's several bills underway to extend and/or augment the current credit which expires 11-30-09. You might think about contacting your representatives and voicing your opinion. A phonecall or letter for America. Keep the faith!
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