Ethical Homes» foreclosure

Fannie Mae Will Pay Closing Costs On Certain Post-Foreclosure Sales

sweth — Thu, 14 Apr 2011 16:40:07 +0000

Fannie Mae is trying to reduce their inventory of foreclosed homes, so to increase buyer demand, they are offering buyers up to 3.5% in closing costs assistance on all offers on HomePath-eligible post-foreclosure sales through June 30, 2011.

For that REO (“Real-Estate Owned”) inventory, Fannie Mae is currently offering buyers up to 3.5% in closing cost assistance through June 30, 2011. The HomePath property buyer must meet the following qualifications to be eligible:

Buyers and/or selling agents (the agent representing the buyer) must request the incentive upon submission of initial offer in order to be eligible.
The initial offer must be submitted on or after April 11, 2011 and close by June 30, 2011. If an initial offer was made prior to the effective date, the offer is not eligible for the incentive.
The sale must close on or before June 30, 2011. No exceptions will be made to this deadline.
Only buyers purchasing a HomePath property as their primary residence may receive up to 3.5% in closing cost assistance. Second homes and investment properties are excluded from the incentive. (HomePath properties are still often very good deals for investment properties; among other things, they are one of the only types of properties that investors can purchase while putting down as little as 10%.)
Buyer must sign and Owner Occupant Certification Rider to the Real Estate Purchase Addendum; this is basically just to confirm the “primary residence” requirement above.
If a buyer’s total closing costs are under 3.5%, the difference will not be available as a credit to the buyer.

Note again that this incentive must be clearly identified on the purchase contract, and these loans must close by June 30, 2011.

Before you put an offer in on a HomePath-eligible property, it’s important that you understand what HomePath financing is. We’ve got a a primer on HomePath financing, but if you still have questions, or want to get prequalified to purchase a HomePath home, let us know.

Are you interested in finding HomePath-eligible properties? We can also help you find a buyer agent who is experienced with HomePath properties, or you can start your search yourself online on the HomePath website.

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Inquire About Your Eligibility For A Loan After A Foreclosure

sweth — Tue, 12 Oct 2010 17:02:27 +0000

Are you trying to get a mortgage after having gone through a foreclosure? Fill out the form below and we’d be glad to let you know if we would be able to help you obtain financing.

(To determine your potential eligibility for a new mortgage, we will need to know some information about how your foreclosure(s) are reported on your credit report. If you don’t already have a recent copy of your credit report, you can obtain one for free by following these instructions.)

[contact-form]

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Not-So-Useful Numbers On Distressed Home Sales

sweth — Wed, 06 Oct 2010 15:20:00 +0000

A new report from RealtyTrac purports to quantify the price differential for financially distressed homes vs. normal sales, but doesn’t really offer much insight.

The RealtyTrac numbers, from a story in Bloomberg, show that properties that sell while “in distress” (i.e. either in default or post-foreclosure) sell at an average price of 26% less than non-distressed properties on a national basis, while the average for DC properties is “at least 35%”. RealtyTrac doesn’t appear to have published their numbers directly, though, so there’s no details on DC vs. the surrounding areas or submarkets within DC, and there’s also no discussion of the methodology involved, so on the whole these numbers are fairly useless.

The naive interpretation of those numbers might be that because distressed properties are in worse physical condition and/or because the sellers of distressed properties are more motivated to sell, those properties are selling for less than they otherwise might, and that distressed properties in DC suffer more from these effects than elsewhere. But there are many other possible explanations for those differences. For example, it’s very probable that lower-income homeowners are more likely to experience financial distress during a recession, both because of greater job instability as well as lower reserve assets; those same two factors might also lead more lower-income owners into distress sale situations, as they might be more likely to need to move for job-related reasons and also be unable to carry the costs of owning a vacant home (or even one that they rented out for less than their mortgage payment) for a period in order to wait for a better time to sell. If those lower-income homeowners also owned homes with fewer desirable features such as size, location, etc., (also very probable), then it’s very possible that their properties might be selling for the same price as other comparable properties, but that since more of those less-desirable properties are selling in distress than the higher-end properties, the average price of all distress sales is shifted towards the lower end of the market.

Put more simply: it’s very possible that distress sales aren’t pushing down the price of properties directly, but instead that the slice of the market that they are a snapshot of might be one that was lower-priced to begin with. In all probability, the numbers are probably a combination of that effect as well as others such as motivated sellers, but attempting to do any real math with seemingly precise numbers like those 26% or 35% differentials is just wasted time.

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HomePath Mortgages Allow Easy Purchase of FNMA Foreclosures

sweth — Tue, 18 May 2010 19:31:26 +0000

While most post-foreclosure properties (aka REOs) end up being owned by individual banks, many such properties actually end up being owned by FNMA (Fannie Mae); since Fannie is one of the major players in mortgage markets, preferred FannieMae lenders are allowed to offer a special HomePath mortgage product that makes the process of buying those Fannie-owned REOs.

HomePath mortgages are available in most of the “normal” flavors available for other conventional mortgages (e.g. 15-, 20-, and 30-yr fixed rate, and 3/1, 5/1, 7/1, and 10/1 adjustable rate); they allow up to 97% LTVs (i.e. only 3% down) for buyers intended to occupy the property as their primary residence, or up to 90% LTV for second-home or investor buyers. Among the advantages of HomePath mortgages are:

They don’t require an appraisal; the negotiated sales price is used as the property value. Since appraisals are one of the biggest unknowns in the underwriting of most modern purchase loans and the piece of the process whose timeline is least predictable, not having one makes the mortgage financing process both more certain and faster.
They have lower upfront costs. As noted above, the buyer does not have to pay for an appraisal, and most HomePath lenders also have lower overall fees on HomePath loans versus conventional mortgages.
They do not require mortgage insurance, which usually lowers the effective rate of HomePath loans. HomePath loans do have slightly higher base rates than conventional mortgages, but for LTVs up to 95%, the effective rates when looking at total monthly payment as compared to FHA loans or conventional loans with MI are usually much lower to HomePath.
They do not require mortgage insurance. which smooths the underwriting process. Conventional loans that require mortgage insurance usually must go through two rounds of underwriting–once by the lender, and again by the mortgage insurer; HomePath mortgages can skip that second round of underwriting, which can often be more stringent than regular mortgage underwriting.
They allow LTVs up to 97%, which is slightly higher than FHA. Due to recent changes, FHA loans normally have a maximum LTV of 96.5%; thus, while FHA often has a better rate for borrowers with LTVs of 95% or higher, for borrowers for whom that extra 0.5% down payment to bring the LTV from 97% down to 96.5% would be a deal breaker, HomePath can often save a purchase that would otherwise fall apart.
They have slightly looser underwriting guidelines for condo developments. Issues with budgets, delinquent association fees, and/or high investor ratios at condo developments are one of the biggest reasons that purchase loans in the DC area don’t get approved these days, and HomePath’s condo guidelines are slightly less stringent than those for other conventional mortgages.

For all of these reasons, HomePath mortgages can be a great tool for borrowers interested in FNMA-owned REOs. How can you tell if a property is eligible for HomePath financing? Most agents listing FNMA-owned REOs will advertise that they are HomePath-eligible, but you can also always double-check (or search for FNMA-owned REOs in your area) at Fannie Mae’s HomePath.com website.

Once you’ve found a HomePath-eligible property, feel free to contact us about getting HomePath financing; our wholesale lending sources are among the strongest in the country, and we are thus on the select list of mortgage brokers who can provide HomePath mortgages.

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Foreclosure Listings Temporarily On Hold

sweth — Mon, 24 Aug 2009 13:54:16 +0000

Due to some technical issues that we’re currently trying to resolve, we’ve had to put the public foreclosure listings on hold temporarily; in the interim, if you’re interested in seeing the foreclosure listings for a specific area, please contact us and let us know what area you’re interested in and we can send you those listings directly or set you up with an automatic search to email them to you regularly.

For those who are interested, the specific problem is that MRIS, the local multiple listing company through whom we were posting those foreclosure listings, recently added some features to their software, including the ability for users to tag properties that they might be interested in. The problem is that for public listings like these, that “feature” was more of a bug, since there is no way for their software to distinguish between the hundreds of different anonymous visitors who were reviewing the listings; as a result, everyone’s “favorite” properties were all mixed together, so that everyone could see each others’ listings and there was no way to know which ones were yours.

Unfortunately, there’s currently no simple way to turn those features off, and the confusion among the people who were contacting us after they saw other people’s listings in “their” list was just too much to deal with, so for now we’ve had to suspend the public listings. It’s a perfect example of unintended consequences–MRIS had simply never thought about the possibility that more than one person would be viewing a particular posted set of listings–and we’re busy working with them to get this resolved in a way that will let us resume those postings, hopefully this week.

Again, if you’re interested in seeing the foreclosure listings for a specific area, please contact us and let us know what area you’re interested in.

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Bank-Owned Foreclosure Inventory in Montgomery County (Week of 8/2/09)

sweth — Sun, 02 Aug 2009 16:34:32 +0000

As a public service for buyers, Ethical Homes is glad to publish a list of all of the available bank-owned foreclosure properties in Montgomery County, MD for the week of 8/2.

Basic information for each new or changed bank-owned property from the last week is provided in that list, as well as pictures and virtual tours (if available); we also include the address, so if you are potentially interested, you can feel free to drive by the property to take a look from the outside on your own.

(If you’re new to our bank-owned inventory lists, be sure to check the archives for any listings from previous weeks that might still be available.)

If you would like more details about any of these properties or would like to explore your opportunities for purchasing one of them, let us know.

We are also in the process of setting up regular tours of all of the foreclosure inventory in Mongtomery County; if you would be interested in participating in one of those tours, please contact us and we’d be glad to notify you when those tours begin.

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Bank-Owned Foreclosure Inventory in Manassas and Prince William County (Week of 8/2/09)

sweth — Sun, 02 Aug 2009 16:33:22 +0000

As a public service for buyers, Ethical Homes is glad to publish a list of all of the available bank-owned foreclosure properties in Manassas and Prince William County, VA for the week of 8/2.

(If you’re new to our bank-owned inventory lists, be sure to check the archives for any listings from previous weeks that might still be available.)

If you would like more details about any of these properties or would like to explore your opportunities for purchasing one of them, let us know.

We are also in the process of setting up regular tours of all of the foreclosure inventory in Manassas & Prince William County; if you would be interested in participating in one of those tours, please contact us and we’d be glad to notify you when those tours begin.

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Bank-Owned Foreclosure Inventory in Loudoun County (Week of 8/2/09)

sweth — Sun, 02 Aug 2009 16:31:56 +0000

As a public service for buyers, Ethical Homes is glad to publish a list of all of the available bank-owned foreclosure properties in Loudoun County, VA for the week of 8/2.

(If you’re new to our bank-owned inventory lists, be sure to check the archives for any listings from previous weeks that might still be available.)

If you would like more details about any of these properties or would like to explore your opportunities for purchasing one of them, let us know.

We are also in the process of setting up regular tours of all of the foreclosure inventory in Loudoun County; if you would be interested in participating in one of those tours, please contact us and we’d be glad to notify you when those tours begin.

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Bank-Owned Foreclosure Inventory in Arlington County & the City of Falls Church (Week of 8/2/09)

sweth — Sun, 02 Aug 2009 16:18:21 +0000

As a public service for buyers, Ethical Homes is glad to publish a list of all of the available bank-owned foreclosure properties in Arlington, VA and Falls Church, VA for the week of 8/2.

(If you’re new to our bank-owned inventory lists, be sure to check the archives for any listings from previous weeks that might still be available.)

If you would like more details about any of these properties or would like to explore your opportunities for purchasing one of them, let us know.

We are also in the process of setting up regular tours of all of the foreclosure inventory in Arlington & Falls Church; if you would be interested in participating in one of those tours, please contact us and we’d be glad to notify you when those tours begin.

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Bank-Owned Foreclosure Inventory in Fairfax County & the City of Fairfax (Week of 8/2/09)

sweth — Sun, 02 Aug 2009 16:16:45 +0000

As a public service for buyers, Ethical Homes is glad to publish a list of all of the available bank-owned foreclosure properties in Fairfax, VA for the week of 8/2.

(If you’re new to our bank-owned inventory lists, be sure to check the archives for any listings from previous weeks that might still be available.)

If you would like more details about any of these properties or would like to explore your opportunities for purchasing one of them, let us know.

We are also in the process of setting up regular tours of all of the foreclosure inventory in Fairfax; if you would be interested in participating in one of those tours, please contact us and we’d be glad to notify you when those tours begin.

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