Related posts:

1. Fannie & Freddie Issue New Guidelines for Delinquent Mortgages
2. Freddie Mac Has Record First Quarter REO Sales
3. How Freddie Mac REO Selling Agents Can Make an Extra $ 1,200

Related posts:

1. Real Estate Investing with Short Sales
2. Short Sale Fees and How to Correctly Charge Them
3. Charging Fees to Buyers for Short Sale Negotiation

Related posts:

1. Pressure Mounting for Creation of National Mortgage Servicing Rules
2. Major Mortgage Investors Not Happy with the Banks
3. Mortgage Rates Edging Up

Enabling Success
With the changing economy and regulations surrounding lending standards, today’s home buyers have questions. They often look to real estate professionals to help them understand the various purchase opportunities, what kinds of loan options are available, and whether now may be the right time to buy. Providing resources and tools for real estate firms to help their clients remains a primary goal for Bank of America Home Loans.

One such tool that can help real estate professionals educate their clients on the home loan process is the Bank of America home loan guide, available at www.bankofamerica.com/myhome. Since the site was introduced in April 2009, more than 660,000 consumers have used it to gain insights into the home loan process and determine what they can comfortably afford. The site was revised in April 2010 and now includes interactive tools and calculators, the ability to save worksheets and information for use at a later date, and a new local mortgage loan officer finder.

“The Bank of America home loan guide offers clear, objective information that will allow consumers to navigate the home-buying process with confidence,” says Todd Dal Porto, Bank of America Home Loans enterprise sales executive.

Some of Bank of America’s alliance partners have begun recommending the home loan guide as a resource for their agents and clients.

Coleen Bush, home loans manager at Bank of America, works closely with agents at Century 21 Town and Country in Detroit. “We’ve held training sessions on the home loan guide for agents in our office,” says Bush. “It gets everyone to the site and provides answers on the home loan process, encouraging our agents to follow-up with their clients.”

Bank of America also offers the Clarity Commitment® loan summary. This one-page document shows home buyers in simple language what they will pay each month, tells them their interest rate, explains closing costs, and includes rate-lock information.

The Clarity Commitment is available for most Bank of America home loans, including first mortgages, home equity loans and reverse mortgages. Since April 2009, more than 1.3 million consumers have received a first mortgage Clarity Commitment, and more than 90,000 consumers have received a home equity Clarity Commitment.

Leveraging Today’s Market
According to the May 2010 Bank of America Mortgage Index Study, seven in 10 consumers believe buying a home in today’s market is a good investment.

“The basic values of homeownership haven’t changed. Buying a home makes sense for individuals and families who are ready to settle, make a house their own and experience a sense of community,” says Carter Murdoch, senior vice president, Bank of America. “Buying a home can mean the monthly payment is going toward something that could eventually build equity and contribute to long-term wealth, and it also may provide some income tax benefits.”

Today’s market presents qualified buyers opportunities through increased inventory and affordability. Lower housing prices in many areas of the country allow buyers who may have been cautious about housing values in the past to find homes that are now within their price range and meet their needs. Combined with buyer assistance programs and Bank of America’s mortgage products for all types of buyers, these circumstances could mean now is the right time to buy for many potential homeowners.

Short Sales and REOs: Opportunities for Home Buyers
Short sales make up a good number of the homes on the market today. However, a common misperception by consumers and some agents is that these homes sell at a discount. While short sale properties do offer buyers increased opportunity through the number of available homes, buyers have a greater chance of getting their offer approved by the seller’s bank or lien-holder when it is close to market value and free from as many contingencies as possible.

In addition, these types of transactions are paperwork-intensive, and can take 60 to 90 days or more to finalize, due to the need for additional documentation by the seller and approvals from third parties that have a financial interest in the loan. Agents should make their clients aware that short sale transactions can be complicated and buyers need to be patient and flexible.

To help streamline the short sale process with Bank of America transactions, the bank uses the Equator platform to help agents and sellers track progress on short sale transactions. Selling agents have online access to the seller’s file and can log in to check the status. With the recent addition of new automatic status alerts to Bank of America’s Equator system, agents now receive e-mail notifications in phases as the short sale reaches valuation, analysis and decision. Agents can feel assured that the short sale is moving forward and they can inform the buyer’s agent and buyer as to the status of a transaction.

“The recent webinar trainings on short sale transactions that Bank of America has offered have been very helpful in understanding the Equator program and using it as a smart solution for our Realtors,” says Amanda Jones, a sales agent with Vanguard Realty.

Although short sale properties don’t offer as much opportunity for buyers looking for deep discounts, real estate owned (REO) properties can be a good option for some potential homeowners. But buyers need to be aware that many bank-owned homes priced below market value are priced that way because they need some level of repair or upgrade, and are usually sold as-is. Although lenders work to maintain functionality and curb appeal of the property, buyers of lower-priced REO homes should be prepared to incur some repair or upgrade costs in addition to the purchase price of the home.

For anyone looking to purchase an as-is property, including an REO, fixer-upper or older home that may need work, Bank of America is one of the few lenders that offers a Federal Housing Administration (FHA) 203(k) loan, which provides funds for the purchase of the home (or refinancing) as well as certain repairs. As with other FHA loans, the required downpayment is only 3.5%, measured against the total cost to acquire and renovate the home. While the borrower may close with the property as-is, the loan amount is based on what the property will be worth after the repairs are complete.

Bank of America recently launched the Buy and Renovate Home Financing Program and an alliance with The Home Depot’s (THD) Home Renovation Services. Home buyers that qualify for a FHA 203(k) loan through this program have access to pre-screened contractors that offer a complete-satisfaction guarantee of their renovation work. In addition, the construction bid is created and managed by a single project manager who submits reports directly to the bank, saving the homeowner time and paperwork.

According to Jim Ragan, relationship manager for Bank of America’s National Builder Division, “The 203(k) purchase option is great for both real estate professionals and homeowners. It helps real estate professionals promote those hard-to-move, fixer-upper listings, and it opens up greater buying options to a larger population of home buyers—those looking for renovations, repairs, remodels or rebuilds.”

“Our agents have been actively promoting the Buy and Renovate Program since early 2010 and we’ve had clients interested in working with us because of the opportunities provided through the 203(k) loans,” says Ken Baris, president, Jordan Baris, Inc. Realtors. “A buyer can finance his or her home and add the money needed for renovations right into the life of the mortgage. This streamlines the process for the buyer; and both home buyers and sellers have told us that it was a deciding factor for working with our company.”

In any home-purchase situation it helps to get pre-qualified for a loan, but when buying an REO or short-sale property, being pre-qualified can help buyers make quick escrow deadlines.

“Short sale and REO transactions are complicated, but by working with Bank of America, we have been able to get loans closed in a timely manner to meet escrow deadlines,” says Vanguard Realty’s Jones. “In this competitive market, it’s nice to have the extra help and assistance from our Bank of America mortgage loan officers.”

Opportunity through the Right Mortgage Product
With greater opportunities for home buyers comes greater opportunity for the real estate professional. A Bank of America Home Loans’ Strategic Business Alliance can create a direct way for brokers and agents to provide assistance to their clients to provide a smooth and rewarding home-buying experience.

“The Bank of America name is a selling point that we didn’t have before our alliance,” says Frank Nolan, director of development sales, Vanguard Realty. “We get more of our loans closed in a timely manner because of our partnership.” Among the several alliance types offered by Bank of America are Marketing Services Agreement, and Marketing Alliance Plus™. The Bank also offers Space Rental Agreements.

With a Marketing Services Agreement, the brokerage receives a flat marketing fee to market Bank of America as a mortgage lender of choice, distribute marketing materials and advertisements and display Bank of America signage in the office.

A Marketing Alliance Plus™ agreement is similar to a Marketing Services Agreement, but the firm performs more extensive marketing services for a larger flat monthly fee. A dedicated account management team from the Bank helps develop a custom marketing plan.

The Space Rental Agreement allows for a Bank of America mortgage loan officer to sit and work side-by-side with agents in the firm’s offices. This gives the firm’s clients direct access to learn about loan options and provides a one-stop shop feel.

“Our partnership with Bank of America has truly impacted our business,” says Baris. “It has made our associates more productive and helped them reach their full potential faster.”

In 2009, Bank of America mortgage business was the No. 1 servicer and the No. 2 originator, as reported by Inside Mortgage Finance. The company maintains a strong position by differentiating with products, quality and service. Through Strategic Business Alliances, firms of all sizes are offered a variety of mortgage alliance solutions. Through these actions, Bank of America Home Loans is dedicated to helping real estate professionals strengthen their business and create successful homeowners.

For more information, visit www.bankofamerica.com/homeloans.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

For more top headlines on RISMedia.com, be sure to see:
Global Market Represents Golden Opportunity
Regional Spotlight: Is Chicago Area Real Estate Market On Cusp of a Strong Recovery?

On this week’s Preforeclosure Daily Grind “Tip of the Week” we dive into how our end buyer’s lenders are cracking down on the inspection reports when they are trying to qualify for a 203,000 loans. Changes are happening everyday when it comes to trying to stabilize this economy, some good and some bad. Listen in as we tell you what to look for when getting our end buyer’s qualified for a 203K loan and much more. We also cover how Bank of America and their Equator.com system is now using automatic email notifications to update homeowners and 3rd party agents during each stage of the short sale process. Also we cover how Chase is updating and cleaning out their system and what to look for in the near future from them, a recent deal that blew up in our face and what happened and much more.

Post Footer automatically generated by Add Post Footer Plugin for wordpress.

Buyer’s Inspection Reports Are Crushing 203 Thousand Loans! is a post from: Short Sale Daily News

Related posts:

1. End Buyer’s Lenders Are NOW Stopping Short Sale Transactions
2. Luxury Short Sales: Your Christmas in July
3. Is the Short Sale End in Sight?

Mortgage interest rates are at their lowest since 1971 and home prices have reached their lowest point since 2002, says IHS Global Insight Inc. economist Patrick Newport, and appear to be stabilizing.

Veteran real estate agents are hard-pressed to remember a time when rock-bottom rates and affordable prices converged this way. So where are all the buyers now that the tax credit is gone?

Reading headlines about the still-iffy economy and staying put, apparently.

Unemployment and lingering uncertainty about the future rank high on a long list of reasons the housing market is still all bound up. Add folks’ inability to sell the homes they have so they can buy new ones, plus tight credit, low offers and too many people just out looking.

“Buyers are looking for the perfect wave,” said Art Herling, regional vice president at Long & Foster Real Estate Inc.

Seller Robin Lori wants that perfect wave to break at her spacious townhouse on Philadelphia’s Green Street, listed at 9,000. The family has occupied this suburban-like space for just two years. Ron Lori landed a good job in Chicago after more than a year out of work, and Robin and her two children who have “thrived on city life,” are following.

“We did have a private offer at the beginning of the year, and for seven weeks, we thought it was sold,” said Lori, filling another packing box. But the buyers’ credit was not good enough for an affordable rate, the deal fell through and the couple lost two precious months before the house and its roof-deck view went on the market.

Last week, Herling said there had been an uptick in multiple offers on houses and he said he thought sales contracts for June looked to be 4-7% above a lackluster May.

The post-tax-credit drop-off in sales concerns Moody’s Economy.com chief economist Mark Zandi though. “The severity of the decline is surprising, particularly given the rock-bottom mortgage rates,” he said. “The stock market correction, weakening confidence and the tough job market may be more of a weight on housing demand than I think.”

Gerald Pierri of Exton, Pa., sat down recently with his newly married son, crunching numbers to see if his son could afford a house in the Boston area, where he lives. Needless to say, they were surprised by what they found.

Before the tax-credit cutoff on April 30, interest rates were about one percentage point higher. Buy today, and the savings on a 0,000, 30-year fixed mortgage would be ,993 over the life of the loan. “While most people are likely aware of lower rates, very few do the math to see what the savings represent,” said Pierri.

A May 2010 Prudential Fox & Roach survey of 690 buyers says people are, indeed, aware. More than 78% of those surveyed said low mortgage rates contributed to the uptick in real estate sales before the tax credit expired.

Also a big factor, 68.3% said: lower prices. So why are buyers having second thoughts?

“Uncertainty, of their future, of their job, of their relationships”—that is the reason he hears most often from wary buyers, said Realtor Mark Wade, who focuses on Philadelphia’s Center City neighborhood. “Many Center City buyers know that a wife or husband, kids and a minivan are in their future, but they are often unsure of when those life-altering events will occur,” said Wade, a Prudential Fox & Roach agent. “Each in and of itself can change one’s need for specific housing.”

Other reasons he hears are fear of change and unfamiliarity with the process.

Economist Joel L. Naroff points to a shortage of equity for down payments, given a decline in property values. “A logjam has formed since many people cannot buy a house until they sell their old one, and that cycle has to be broken by confidence in the economy and ability to sell homes,” Naroff said. “Right now, that doesn’t exist.”

Countered Noelle Barbone, manager of Weichert Realtors’ Media, Pa., office, who has been selling houses since 1969: “Sure, you might not sell your house for what you would have gotten a few years ago, but you won’t have to pay as much for a new one.”

“Everyone is afraid of buying a house only to watch its value erode in the first year or two,” said Bankrate.com columnist Holden Lewis. “Even if they plan to live in it for many years, people succumb to fear of short-term price depreciation.”

Jobs—or the lack of them—are making the difference, said Philadelphia mortgage broker Fred Glick. Employment growth will come slowly “because there is no magic bullet for an economic shot in the arm, like the computer/Internet boom of the ’90s.”

As Philadelphia economist Kevin Gillen sees it, “The recession that started with the bursting of the housing bubble has come full circle. Whereas housing led us into the recession, the recession is now leading housing.”

(c) 2010, The Philadelphia Inquirer.

Distributed by McClatchy-Tribune Information Services.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Copyright© 2010 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

“We have seen home buyer interest in FHA loans go from practically zero three years ago to upwards of 87% today,” said Christopher Gardner, founder and president of FHA Pros, LLC. “Despite this rapid rise in popularity, many buyers still do not fully understand the benefits of these loans, and we believe it’s time to change that.”

1. FHA loans are not only for lower-income borrowers. FHA loans are available to everyone. There is no maximum income restriction associated with FHA loans, but borrowers do need to substantiate income and assets by submitting proper documentation. This requirement ensures that borrowers are well-vetted and truly able to afford their future homes.

2. FHA loans are not only for first-time buyers. Many people believe FHA loans are available only to first-time home buyers, but this is not the case. Whether borrowers are making their first home purchase or their fifth, they can look to FHA loans as a home financing option.

3. FHA loans are not just small loans; in fact, loan amounts can be as high as almost 0,000. The government recently raised the maximum loan amount from its original cap of 2,790 to 3,750 as a way to help stabilize the housing market. The amount a buyer can borrow varies from county to county though. Later this summer, condo buyers interested in FHA loans can visit www.checkfhaapproval.com to instantly identify FHA-approved condo associations and review maximum loan amounts for a given location.

4. FHA loans are not affiliated with the section 8 housing program. While both programs are administered by the U.S. Department of Housing and Urban Development (HUD), FHA loans have nothing to do with low-income subsidized housing. FHA loans are simply mortgages insured by FHA. This insurance provided by the federal government allows lenders to lend more freely by assuring them that they will be repaid in the event of default. Most traditional lenders, including Wells Fargo & Co., JP Morgan Chase and Citigroup are able to provide FHA loans to their customers.

5. FHA loans are often more affordable than conventional loans. While FHA loans typically offer the same interest rates as other loans, borrowers benefit from a much lower down payment of as low as 3.5%.

6. FHA-approved condo developments are more desirable to buyers. With 87% of home buyers indicating that they plan to use FHA loans, condo associations that are not FHA approved are missing out on a significant pool of prospective buyers. Under rules in place since February 2010, an entire condominium development must now apply to HUD and be granted FHA approval before a buyer can purchase a unit in an association with an FHA loan or before an existing unit owner can refinance into an FHA loan.

Due to the general unwillingness of today’s lenders to extend credit with respect to conventional loans, many borrowers find that FHA is their best bet. Lenders don’t mind lending when the federal government (FHA) assures them of repayment.

Homeowners associations (HOAs) should note that although FHA-insured mortgages might be easier to obtain, they are not “risky” loans, due in large part to the strict “full documentation” requirements placed on borrowers. Individual buyers or sellers can initiate the approval process or current owners can encourage their HOA to apply.

7. FHA loans are assumable. In addition to lower down-payment and credit-qualifying requirements as compared to conventional loans, FHA loans are assumable. This means that when a seller with an FHA loan sells his or her property, the loan and its financing terms (interest rate) can be transferred to the new buyer. This unique feature will certainly make a property more valuable in times of rising interest rates.

“Now, more than ever, buyers and sellers need to understand the options available to them when it comes time to buy a home,” continued Gardner. “At FHA Pros we have worked with countless HOAs, attorneys and individuals to easily and efficiently navigate the historically tricky FHA-approval process.”

For more information, visit www.checkfhaapproval.com.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.