$8000 Tax Credit Extension Deadline Looms for DFW

As the government squabbles to extend the deadline for buyers to close on their homes and claim the tax credit, anxious first time buyers are hoping they get something accomplished so they don’t miss out on their $8000.  I don’t blame them.  $8000 is a big chunk of change to ANYONE (ok maybe not Bill Gates).  But for the rest of us, that type of money can make a big difference on your annual income. As of today, to receive the tax credit for first time home buyers, you would need to meet two guidelines in regard to time.  First of all, you had to have your initial contract signed by the end of month in April, and you have to actually close on the transaction by the end of June.  Sounds simple enough, right? Well, the problem arose when (just like always) people drug their feet and waited until the last minute to find a house or get a home loan.  Consequently, a bevy of loans went to the lenders, and due to the high volume they couldn’t close them in time.  Next thing you know, it is the end of June and ...

How to Find Foreclosures in Dallas-Fort Worth

For the second straight month, the number of foreclosed properties across the United States jumped to a record level, according to RealtyTrac.com.  The total number of repossessions is estimated to be as high as 93,000 across the nation. This is somewhat surprising, being that April was the first month in recent history where the number of foreclosures actually fell from the previous month.  Long story short, this behavior is indicating somewhat that the overall number of foreclosed properties has peaked.  Only time will tell, though. BENEFITS OF BUYING FORECLOSURES According to the National Association of Realtors, the typical discount received from purchasing a distressed or foreclosed property is on average around 15 percent.  That’s amazing, as long as the condition of the property isn’t deplorable.  Why does this matter?  Generally, to receive financing for a home, the property has to meet certain conditions and requirements in regard to its physical state.  Bad roofs, wiring or plumbing all represent types of defects that would make a property essentially “un-lendable.”  So unless you are planning on paying with cash, you’re going to have to get an appraisal or in depth inspection to see if the property will ...

FHA Plans to Lower Seller Concessions This Summer

The Federal Housing Administration, which currently offers one of the most popular types of home loans (FHA), is changing one of its most celebrated aspects this summer, at least that's what the rumor is.  The aspect I am referring to is the maximum amount of allowable seller concessions, which permit property owners to pay for some of the services and fees connected with the loan transaction.  Inspections, origination, escrow and title fees are just a few of the costs that can be paid via seller concessions, and the new change is expected to receive some backlash as the summer progresses. HOW LOW CAN THEY GO? The amount of the rumored change would drop the allowable amount of seller concessions from 6% of the sales price down to 3%, which is still enough to cover all the closing costs on a loan of approximately $250,000, but anything less than this will force buyers to pay at least some of their costs out of pocket. WHY WOULD THEY DO SUCH A THING? The FHA is making this change in an effort to protect the value of the homes it has loans on.  When a seller ...

All About HELOC’s (How exciting!)

One of the good things about having a mortgage is the ability it gives you to build up equity in your home.  What's equity you ask?  Well, you can click here or I can tell you really quick.  Quite simply, equity is the amount of money you have already paid against the value of your home, and it is an easy value to determine with a little bit of math. HOW TO DETERMINE YOUR EQUITY The easiest way to find out how much equity you have in your home is to subtract the amount of your mortgage balance (look on your mortgage statement for UPB, Unpaid Principle Balance, or just Principle Balance) from the current value of your home.  For example, if your home is worth $100,000 and you owe $40,000, then your equity is $60,000.  In other words, as you pay down the principle on your mortgage, your equity increases inversely. HOW DOES EQUITY WORK FOR YOU? What makes equity special?  Well, equity can actually work for you if you know how to do it.  Many people borrow against it and use the money they take out to ...

FNMA Won’t Secure Loans On Foreclosed Properties Still In Redemption Period

On May 27th, FNMA released a new guideline that will make it a bit harder for people to purchase foreclosed properties.  The new rule states that FNMA will not buy or accept a loan on a foreclosed home that is still in its "redemption period," the length of which is specified by each particular state.  For example, the redemption period in California is 12 MONTHS LONG.  Wow. WHAT DOES THIS MEAN? Long story short, certain states have laws on the books that provide tenants with a "redemption period" that starts after a foreclosure or tax sale has occurred.  During this time period the tenant or owner can reclaim title/ownership to the property if they pay all the amounts they owe.  This new rule mandates that the house cannot be sold to FNMA during this time period.  How are they doing this?  Well, FNMA is declaring houses that are still in the redemption period to be specified as having "unacceptable title defects." Furthermore, any loan with an unacceptable title defect is deemed ineligible for delivery or sale to FNMA until after the redemption period has officially expired.  Whew. FYI, loans are still ...

Now Is The Time To Refinance In DFW

I know I mentioned this last week, but it really is worth noting another time that interest rates here in DFW are at record lows.  So, actually how low are we talking?  Well, some people are claiming that this is the lowest we've seen rates in over 30 years.  That's right, 30 years.  To top it off, just last month home sales went up almost 8%, and the average home price also increased in the amount of 4% from last year.  Obviously this change is being driven by something, but what exactly is it? CONTRIBUTING FACTORS TO HOME SALES The most obvious answer to this question would be the ever popular $8000 tax credit, which actually expired earlier this year.  Experts agree that this credit pushed first time homebuyers into purchasing a home before the credit was gone.  In order to qualify, buyers had to sign their real estate contracts by April 30 -- and they still have to close on their home by the end of this month, June 30th.  So we could still see figures rise as we reach the full expiration of the tax credit. CONTRIBUTING FACTORS TO LOW INTEREST ...