FHA REO properties sold by FHA
Re-sales of properties purchased by an employer or relocation agency
Property inherited by the seller
Sales by other U.S. Government Agency of SFR properties
Sales of properties by nonprofits approved to purchase HUD owner SFR
Sales of properties by state and federally charted financial institutions and GSE
Sales of properties by local and state government agencies
Sales of properties within Presidentially-Declared Disasters Areas
Sales of properties acquired by foreclosure by state licenses mortgage lenders
Any re-sales, other than those exemptions listed above, where the sales price increase is less than 20% of the seller’s acquisition cost

If a property sales price has increased more than 20% over the acquisition cost, the property is not eligible for FHA financing.

If you have any specific questions, feel free to contact me directly.

Today the Florida Supreme Court ruled in favor of the Federal Trade Commission (FTC) in the pivotal case Olmstead v Federal Trade Commission. The decision greatly favors creditors in their attempts to collect personal debts from debtors with assets held in single member Limited Liability Corporations (LLCs). LLCs are business entities created to provide tax benefits similar to that of a partnership, and liability protection similar to that of a corporation. The ruling of Olmstead threatens these benefits and protections for LLCs that have only one member (owner).

via Key Victory for Creditors in Florida Supreme Court.

via Government Takes a Stronger Hold On HAMP.

via Seven Year Penalty for Strategic Default.

Home Affordable Foreclosure Alternatives (HAFA) streamlines the process for doing a short sale or deed-in-lieu of foreclosure for distressed homeowners who do not qualify for a federal home loan modification through the Home Affordable Modification Program (HAMP) or have missed consecutive payments after a modification.

The HAFA program started April 5, 2010, and ends December 31, 2012. Federal rules require servicers participating in HAMP to implement HAFA. The new program also requires borrowers to be released fully from future liabilities related to their first mortgage, including cash contributions, promissory notes and deficiency judgments.

Participation in HAFA cannot save homeowners from losing their property, but it can eliminate the effects of a foreclosure on their credit. Financial incentives for program participation include a $1,000 servicing bonus for lenders and a $1,500 relocation bonus for displaced homeowners. Lenders of other subordinate liens (e.g., HELOCs) may be allowed to keep a limited portion of the proceeds (up to $3,000 each) of a short sale, with the first-lien lender’s approval.

HAFA is designed for homeowners who have applied to HAMP for assistance but have had no success with their loan modification program. To participate in HAFA, homeowners must still meet HAMP’s eligibility criteria: home is principal residence; first-lien mortgage is in delinquency or default is reasonably foreseeable; loan closed before January 1, 2009; unpaid balance is under $729,750; and the mortgage payment is over 31% of gross income.

For more information on HAFA, go to the following link:

https://www.hmpadmin.com/portal/programs/foreclosure_alternatives.html

The best way to avoid foreclosure is to pursue alternatives like a short sale or a loan modification. Don’t run from the obligation, but instead confront it head on with an experienced Realtor and your lender to determine the best approach.

Besides the obvious impact to the homeowner of losing the home itself, a post-foreclosure credit score will take a hit of at least 200 points and the homeowner’s credit history will reflect the foreclosure for seven years.

But the ripple effects continue. Both the neighborhood of the foreclosed home and the surrounding community are adversely impacted. Along with the equity, the value of those area homes declines and the likelihood of theft and vandalism increases.

Obviously there is lot at stake. A targeted approach with your lender, a licensed Realtor, and possibly a legal resource will potentially help your situation, maintain the integrity of your neighborhood, and eventually restore some balance to this market.

Coming just weeks before the April 30 deadline for the Home Buyer Tax Credit and just days after the March 31 expiration of the Federal Reserve Board’s mortgage backed securities purchase program (which has kept home loan rates artificially low for over a year), these FHA changes make it even more important to act now to save big.

Here are a few reasons why:

On April 5th, the cost of required up-front mortgage insurance for loans guaranteed by the FHA will increase from 1.75% to 2.25%. For a borrower purchasing a $200,000 home with a $7,000 down payment, the up-front mortgage insurance will increase by $965. Up-front mortgage insurance is typically financed in the final loan amount so the impact to a monthly payment will be minimal but overall, the increase is still borne by the borrower both upfront and monthly.

Later this spring, the amount of money that a seller can return to the buyer from their sale proceeds will be reduced from 6% to 3%. The reduction in these “seller concessions” can increase the amount of cash a buyer will be required to pay at closing by $6,000 for a home purchase of $200,000.

There is only one way to avoid being affected by all of these costly changes that lie ahead – submit all FHA mortgage applications by the last week of March.

If I can answer any questions you may have about how these changes could impact you, call me at 727-488-9747. We always enjoy helping our clients!

Search for all the Foreclosure properties in Tampa Bay.

We are working closely with Bank of America in an effort to expedite any short sale they own or service.