Tuesday, August 21, 2012
FHFA issues new guidelines for Fannie/Freddie Short Sales
Back in June, the Federal Housing Finance Agency 'FHFA' announced that strict timelines for servicers to respond to short sales within 30 days of receipt of a short sale offer, provide weekly status updates to the borrower, and communicate a final decision to the borrower within 60 days of receipt of the offer.
They have followed that up with new guidelines that will take effet November 1, 2012:
•Eliminates current Fannie Mae and Freddie Mac short sale programs and creates a single standard short sale process for both entities (Fannie and Freddie HAFA programs will expire at the end of the year).
•Enables servicers to quickly and easily qualify certain borrowers who are current on their mortgages for short sales without waiting for an approval from Fannie Mae or Freddie Mac
•Offers special treatment for military personnel with Permanent Change of Station (PCS) orders.
•Standardizes and clarifies foreclosure suspensions on a property with an approved short sale.
•May pay borrowers up to $3,000 in relocation assistance.
•Fannie Mae and Freddie Mac will offer up to $6,000 to subordinate lien holders to expedite a short sale.
In addition, FHFA clarified that a borrower experiencing a hardship must wait at least two years before becoming eligible for a Fannie Mae or Freddie Mac loan.
We haven't experienced the complete implementation and follow through of the items from June and hope that will improve. It will be interesting to see how these guidelines are implemented from November 1st forward and what the transition will involve for HAFA qualified applications that don't close by year end.
Stay tuned and Keep the faith!
La Quinta Real Estate
Thursday, May 31, 2012
Fannie & Freddie speeding up the Short Sale process
Federal regulators have hopes of greatly streamlining the short-sale process starting mid-June. Bank of America started an expedited process of their own April 15th and now starting June 15, the Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac, will require both agencies to give short-sale buyers a final decision within 60 days. (In a short sale, a lender agrees to accept less than the balance on a mortgage.)
Fannie and Freddie must also respond to initial requests for a short sale within 30 days of receiving the buyer’s submission.
“Short sales are huge right now,” said Peter Spino, the foreclosure services manager for Community Housing Innovators in White Plains, N.Y., a housing counselor certified by the Department of Housing and Urban Development. Distressed homeowners often prefer them to a foreclosure, he noted.
Expedited sales as a result of the new directive will benefit the entire housing market, said Michael McHugh, the president and chief executive of Continental Home Loans and the president of the Empire State Mortgage Bankers Association, a trade group. They could also remove some risks for buyers — many of whom previously had to wait months for a decision and then ended up not getting the house they wanted.
In March, the most recent month for which data were available, short sales represented more than 14 percent of existing home sales, according to CoreLogic, a data analytics company, compared with 12 percent for all of 2011 and about 10 percent in 2010. And as the number of short sales has risen, foreclosures have fallen. Completed foreclosures represented 25.3 percent of home sales in March, versus 34.9 percent in all of 2011 and 42.7 percent in all of 2010.
Lenders favor short sales because they are less costly and more efficient than foreclosures. Yet the homeowners, trying to exit as gracefully as possible, never know how long the process will take or how badly their credit will be hurt.
Although short sales have a reputation for being easier on credit scores than foreclosures, “that’s a fairly common misperception,” said Rod Griffin, the director of consumer and public education at Experian, one of the major credit bureaus. If there is a difference in impact, he said, it is slight. Both short sales and foreclosures remain on the credit report for seven years — but foreclosures don’t appear until the legal paperwork is filed, and that could take months, Mr. Griffin said.
The effect was measured in an analysis by VantageScore, a provider of credit scores used by lenders. The higher the credit rating a consumer has, the more points he or she would lose in a short sale.
If consumers started with, say, an 830 score, they would most likely lose 100 to 110 points from a short sale, 120 to 130 points from a foreclosure. But a homeowner with a 625 score, who is behind on his mortgage and some credit card payments, would lose 15 to 25 points from a short sale and 10 to 20 points from a foreclosure, the VantageScore analysis shows.
One major downside to a short sale has always been the length of time it takes to process the transaction. The application goes from Borrower(s) to Real Estatae Agent(s) to Negotiator to Bank to Investor (and maybe to Private Mortgage Company) and then back down the line; and if there are hiccups along the way, there can be lenghty delays in the process between the various links (i.e. valuation problems, counter offers, etc...) Short Sales have been done in record times (1-2 months) with 3-6 begin the norm and I’ve also had them take a year. I am actually working on one property that is approaching 1,000 days.
Locally, the inventory level is so low that Buyers who would not have previously looked at Short Sales are now jumping at the chance to submit an offer, certainly evidence that the buyer's market is gone.
As always, keep the faith!
Saturday, May 19, 2012
Short Selling? BofA might pay up to $30,000
Bank of America is offering some struggling homeowners payments of up to $30,000 if they sell their homes in a short sale and avoid ending up in foreclosure.
Under the plan, Bank of America will offer homeowners so-called relocation payments of between $2,500 and $30,000 if they sell their home in a short sale. In short sale deals, the sale price of the home is less than what the seller owes the bank.
The bank first tested the payments in a pilot program in Florida last fall. Under that initiative, Bank of America paid up to $20,000 to borrowers who sold their homes in short sales."This program can help customers make a planned transition from ownership when home retention options have been exhausted or they have made a decision not to keep the home," said Bob Hora, an executive for the bank. Chase started a similar initiative in late 2010 that pays as much as $35,000 to short sellers. Wells Fargo has also paid five-figure incentives to short sellers or to owners who turned over their deeds to the bank.
BofA said it has completed 200,000 short sales over the past two years. These sales are generally more cost effective for banks than foreclosures. By avoiding foreclosure, the lenders get distressed properties back from delinquent borrowers more quickly, which helps them to avoid property tax payments, maintenance expenses and legal fees that can build up for months, even years, as foreclosures work through the system.
In addition, the incentives help guarantee the homes will return to the lenders in better condition. Foreclosed properties are often poorly maintained, even sometimes sabotaged, by angry former owners, making them worth far less to the banks. During the last three months of 2011, foreclosures sold for an average of about $150,000, according to RealtyTrac. Meanwhile, short sales sold for an average of about $185,000.
To qualify for Bank of America's relocation payments, borrowers must obtain pre-approval on sale prices for their homes. The sale must begin by the end of 2012 and close by September 26, 2013. The exact compensation is determined case-by-case based on a calculation that involves the home's value, mortgage balance and other factors.
I am here to assit you with this inquiry so please call upon Short Sale Sully for assistance (760) 610-3245 .. and as always...
Keep the faith!
Monday, April 23, 2012
Congress considers extension to mortgage-debt relief deadline
Congress considers extension to mortgage-debt relief deadline
Action not expected until post-election
By Ken Harney Inman News®
For anyone hoping that a fractious, election-bound Congress can manage to extend a law that is crucial to the housing recovery -- the Mortgage Forgiveness Debt Relief Act -- here's a little good news: Before heading home for the Easter holiday recess, key members of the House and Senate tax-writing committees introduced bills that would keep the law alive through 2014.
Without action by Congress, the law -- which allows homeowners whose mortgage debts have been written off by lenders in short sales, foreclosures, principal reductions and deeds-in-lieu of foreclosure to escape heavy federal taxation on the amounts forgiven -- would expire Dec. 31, 2012.
Real estate and mortgage trade groups believe that any expiration would be disastrous for large numbers of underwater owners trying to rid themselves of smothering debt loads.
It could also sharply reduce the appeal of short sales and other resolutions needed to clear out distressed inventories.
If homeowners thought they'd be penalized for agreeing to principal reductions and debt cancellations, they'd be far less likely to participate.
That, in turn, could hamper efforts like the $25 billion nationwide robo-signing mortgage settlement, which features more than $10 billion in debt forgiveness, as well as the Obama administration's efforts to spur short sales and principal reductions at Fannie Mae and Freddie Mac.
Until the tax code was amended in 2007, the Internal Revenue Service treated owners whose unpaid principal balances were canceled as having received actual income from the transaction and hit them with tax bills.
For example, in a short sale where the lender wrote off $100,000 of unpaid mortgage debt prior to 2007, the federal tax code treated the $100,000 as ordinary income to the seller and the IRS imposed tax levies at regular rates.
Though the prospects for quick action on the issue are virtually nonexistent, the sudden introduction of multiple bills on both sides of Capitol Hill can only be a positive sign.
In the Senate, Finance committee member Debbie Stabenow (D-Mich.) joined with fellow Democrats Robert Menendez (New Jersey), Sherrod Brown (Ohio) and Jeff Merkley (Oregon); and two Republicans: Dean Heller (Nevada) and Johnny Isakson (Georgia), on a proposed extension (S 2250) through Dec. 31, 2014.
In the House, 14 of the 15 Democrats on the Ways and Means Committee -- the point of origination for most tax legislation in Congress -- are co-sponsoring a bill (HR 4202) with the same provisions as Stabenow's.
One Republican on the Ways and Means Committee, U.S. Rep. Tom Reed of New York, also is introducing an extension bill, but the text and bill number were not immediately available.
President Obama's fiscal 2013 federal budget proposal calls for an extension through 2014, which congressional analysts estimate would cost the government $2.7 billion in tax revenues over the coming two years.
In a statement, Stabenow said, "It is bad enough that so many families are faced with mortgages that now exceed the value of their home.
"But to add insult to injury, without this bill the IRS would once again require these families to pay hundreds or thousands of dollars in additional income tax when they sell or refinance their home. That's just wrong."
The lack of more Republican co-sponsors on Reed's bill may point to difficulties for the debt relief extension that could materialize as early as the end of this month.
The Republican-controlled Ways and Means Committee says it plans to look at all "extenders" -- expired or soon-to-lapse special benefit programs ranging from corporate research and development tax credits to individual homeowner write-offs for residential energy improvements -- within the next two weeks.
If the Republican majority decides that mortgage debt relief is just another contributor to the federal deficit, the House version of bills could be derailed indefinitely.
(Remember that last December, House and Senate conferees deferred action on a long list of extenders -- including deductions for private mortgage insurance premiums -- and they all remain in legislative limbo.)
But tax analysts and lobbyists on Capitol Hill say the most likely scenario shapes up something like this: Though the National Association of REALTORS® and other groups will push for early consideration of the debt relief extender, it's unlikely that Congress will be able to focus on a major revenue package until after the November elections.
Then, the victors and lame ducks from both houses will have to do the year's tough lifting: They'll take up the entire range of budget, deficit and debt-ceiling issues during several frenetic weeks, and finally hammer out an omnibus bill that includes either a one- or two-year new lifeline for mortgage debt relief.
Though there's a chance the entire process will break down again as it did last year, Jim Tobin, chief lobbyist for the National Association of Home Builders, told me last week, "We remain optimistic that once we get past the election and into a robust lame duck session, Congress will do the right thing" on mortgage forgiveness.
"But any way you look at it," he added, "taxing (financially distressed) homeowners on phantom income is just inequitable."
Plus, it makes absolutely no economic or political sense for either party -- whether we have a President Romney and Republican majorities in both houses, or President Obama and the Democrats come away big winners -- to kick homeowners when they're already down.
Stay tuned to ShortSaleSully for more great information ... and as always
Keep the faith!
Action not expected until post-election
By Ken Harney Inman News®
For anyone hoping that a fractious, election-bound Congress can manage to extend a law that is crucial to the housing recovery -- the Mortgage Forgiveness Debt Relief Act -- here's a little good news: Before heading home for the Easter holiday recess, key members of the House and Senate tax-writing committees introduced bills that would keep the law alive through 2014.
Without action by Congress, the law -- which allows homeowners whose mortgage debts have been written off by lenders in short sales, foreclosures, principal reductions and deeds-in-lieu of foreclosure to escape heavy federal taxation on the amounts forgiven -- would expire Dec. 31, 2012.
Real estate and mortgage trade groups believe that any expiration would be disastrous for large numbers of underwater owners trying to rid themselves of smothering debt loads.
It could also sharply reduce the appeal of short sales and other resolutions needed to clear out distressed inventories.
If homeowners thought they'd be penalized for agreeing to principal reductions and debt cancellations, they'd be far less likely to participate.
That, in turn, could hamper efforts like the $25 billion nationwide robo-signing mortgage settlement, which features more than $10 billion in debt forgiveness, as well as the Obama administration's efforts to spur short sales and principal reductions at Fannie Mae and Freddie Mac.
Until the tax code was amended in 2007, the Internal Revenue Service treated owners whose unpaid principal balances were canceled as having received actual income from the transaction and hit them with tax bills.
For example, in a short sale where the lender wrote off $100,000 of unpaid mortgage debt prior to 2007, the federal tax code treated the $100,000 as ordinary income to the seller and the IRS imposed tax levies at regular rates.
Though the prospects for quick action on the issue are virtually nonexistent, the sudden introduction of multiple bills on both sides of Capitol Hill can only be a positive sign.
In the Senate, Finance committee member Debbie Stabenow (D-Mich.) joined with fellow Democrats Robert Menendez (New Jersey), Sherrod Brown (Ohio) and Jeff Merkley (Oregon); and two Republicans: Dean Heller (Nevada) and Johnny Isakson (Georgia), on a proposed extension (S 2250) through Dec. 31, 2014.
In the House, 14 of the 15 Democrats on the Ways and Means Committee -- the point of origination for most tax legislation in Congress -- are co-sponsoring a bill (HR 4202) with the same provisions as Stabenow's.
One Republican on the Ways and Means Committee, U.S. Rep. Tom Reed of New York, also is introducing an extension bill, but the text and bill number were not immediately available.
President Obama's fiscal 2013 federal budget proposal calls for an extension through 2014, which congressional analysts estimate would cost the government $2.7 billion in tax revenues over the coming two years.
In a statement, Stabenow said, "It is bad enough that so many families are faced with mortgages that now exceed the value of their home.
"But to add insult to injury, without this bill the IRS would once again require these families to pay hundreds or thousands of dollars in additional income tax when they sell or refinance their home. That's just wrong."
The lack of more Republican co-sponsors on Reed's bill may point to difficulties for the debt relief extension that could materialize as early as the end of this month.
The Republican-controlled Ways and Means Committee says it plans to look at all "extenders" -- expired or soon-to-lapse special benefit programs ranging from corporate research and development tax credits to individual homeowner write-offs for residential energy improvements -- within the next two weeks.
If the Republican majority decides that mortgage debt relief is just another contributor to the federal deficit, the House version of bills could be derailed indefinitely.
(Remember that last December, House and Senate conferees deferred action on a long list of extenders -- including deductions for private mortgage insurance premiums -- and they all remain in legislative limbo.)
But tax analysts and lobbyists on Capitol Hill say the most likely scenario shapes up something like this: Though the National Association of REALTORS® and other groups will push for early consideration of the debt relief extender, it's unlikely that Congress will be able to focus on a major revenue package until after the November elections.
Then, the victors and lame ducks from both houses will have to do the year's tough lifting: They'll take up the entire range of budget, deficit and debt-ceiling issues during several frenetic weeks, and finally hammer out an omnibus bill that includes either a one- or two-year new lifeline for mortgage debt relief.
Though there's a chance the entire process will break down again as it did last year, Jim Tobin, chief lobbyist for the National Association of Home Builders, told me last week, "We remain optimistic that once we get past the election and into a robust lame duck session, Congress will do the right thing" on mortgage forgiveness.
"But any way you look at it," he added, "taxing (financially distressed) homeowners on phantom income is just inequitable."
Plus, it makes absolutely no economic or political sense for either party -- whether we have a President Romney and Republican majorities in both houses, or President Obama and the Democrats come away big winners -- to kick homeowners when they're already down.
Stay tuned to ShortSaleSully for more great information ... and as always
Keep the faith!
Thursday, February 23, 2012
How to bounce back from a Short Sale and/or Foreclosure
Greetings from Short Sale Sully (Roger@ShortSaleSully.com) The following is a reproduction of an article from today's Desert Sun. In my opinion, it's very informative and provides some good tips. After reading through this, please note my closing comments. If you have suffered through one of these situations, you've already had the setback ... make note and avail your self of all the little things necessary to make your 'comeback" simpler and succcessful. Here's the story from Alex Veiga
Next to filing for bankruptcy protection, nothing wrecks your chances of qualifying for a home loan like a foreclosure.
And if you got out from under an oppressive mortgage through a short sale — when the bank agrees to accept less than what the homeowner owes — lenders can look upon you just as unfavorably.
It's a reality that the former owners of the more than 4 million homes lost to foreclosure in the six years since the housing bubble burst will have to confront if they want to own again. But the passage of time makes all the difference.
That's because mortgage-lending guidelines that most banks follow prohibit them from making loans to people with foreclosure or a short sale in their credit history, often for years. Never mind the hit that one's credit score takes.
Still, some of the homeowners who were foreclosed upon when the market first started to skid are now looking to buy and getting loans.
“They're probably going to pay a little higher interest rate, but with rates so low, a higher interest rate of 4 percent is not a big deal,” said Rosa Herwick, a broker and owner of Century 21 JR Realty in Henderson, Nev.
So how likely are banks to approve your mortgage application if you have a real estate-related blemish on your record? And can you do anything to spring yourself from the mortgage penalty box?
It depends on several factors, but largely on whether you had a foreclosure or a short sale.
Foreclosure
Generally, borrowers who have a foreclosure in their credit history can expect to wait two to seven years before a lender will even accept their loan application.
The waiting periods stem from guidelines most banks must follow in order to be able to sell their home loans. That's because potential purchasers, such as Fannie Mae and Freddie Mac, each have a different set of guidelines for the loans they will buy and criteria for whom they deem a qualified borrower.
The fact is, a person's credit score, employment history and other factors that make up one's creditworthiness will take a back seat to these resale guidelines.
If a buyer with a past foreclosure is seeking a government-backed mortgage, the waiting period can vary before they can qualify.
Take the Federal Housing Administration, which insures roughly 30 percent of new loans. Under its guidelines, former homeowners must wait three years from the date of their foreclosure before they can qualify for backing by the agency.
Compare the U.S. Department of Agriculture's housing program, which requires three years, while the time penalty for a VA loan is two years. Fannie Mae and Freddie Mac, which own or guarantee about half of all mortgages, require the longest stretch: seven years after a foreclosure.
In some cases, the waiting periods for a foreclosure can be reduced.
Fannie Mae, for example, allows a three-year waiting period in the event the foreclosure was due to an extenuating circumstance. The company defines this as an event that was beyond the homeowner's control and resulted in a sudden reduction in income or catastrophic increase in financial obligations. Think job layoff, medical bills or divorce.
FHA may grant an exception to its waiting period in the event a wage-earner becomes seriously ill or dies. A divorce may qualify for an exception, but only in certain cases.
Short Sales
The roadblocks for having a short sale in your credit history can be less severe, and in some cases, waived altogether.
FHA requires borrowers who weren't paying their mortgage when they sold their house to wait three years before they can qualify for a home loan. That time penalty may be waived in certain cases, including long-term job loss.
There is no FHA time penalty for homeowners who made their house payments in the 12 months before their short sale.
The size of a down payment can also shorten the waiting period.
A down payment of 20 percent or more will cut Fannie Mae's time penalty on a borrower with a short sale down to two years from seven. Buyers who put down 10 percent can qualify after four years.
Credit scores
It's no longer just a waiting game for homeowners caught up in the earliest stages of the foreclosure crisis in 2007 and 2008.
There's still the impact a foreclosure or short sale has on one's credit score - still very much a factor in qualifying for a loan.
Like most blemishes, foreclosures and short sales will remain in your credit history for seven years.
As a general rule, the higher your credit score, the more it will drop as a result of a bad debt, said Barry Paperno, consumer affairs manager for myfico.com, the consumer website for FICO.
FICO credit scores range from 300 to 850. In simulations, a foreclosure sent a FICO score of about 720 down to as low as 570 and took about seven years to recover fully, assuming everything else being equal.
Still, there are steps one can take to burnish one's tarnished credit rating.
While in the foreclosure penalty box, make sure to pay all your bills on time.
Get more credit. This may sound counterintuitive after a foreclosure, but beefing up your track record of good credit accounts can help boost one's credit score. A car loan or a credit card will do. But if you get a credit card, pay it off every month.
Be patient. A foreclosure's drag on your credit score will decline over time.
Dispute any mistakes on your credit report, which can lower your score.
Don't close your oldest credit accounts. Your score gets a boost from older credit lines.
Scale back your lifestyle, and pocket the savings toward a future down payment.
So I hope you took notes and here's a few tips to add to the list:
1) Keep copies of the checks for any/all payments made in the last 2 years of time you had made payments on the loan (even if they were partial payments) and keep these in a safe spot;
2) If you bank online, print out and keep the monthly statements;
3) Make it a habit to keep all pages of your bank statements (even if it's a blank). When a statement given to a Lender says it's one of 8 pages, they want to see all 8 pages. Just keep these with your tax data after filing yearly and recycle when your purge your tax files.
4) Start the same habit with your paystubs. Down the line this will be crucial;
5) Introduce yourself to AnnualCreditReport.com. This is a free service to order copies of your credit report (you must pay if you want scores but why bother for a few years). You can order one from each of the three companies but if you get in the habit of ordering one every 4 months, you have a rotating means of checking your credit and making sure there are no unexpected reports; and if so, you'll have time to deal with it.
So SHORT SALE SULLY says "GOOD LUCK" and I am here if you need me and like always ... Keep the faith!!!
Next to filing for bankruptcy protection, nothing wrecks your chances of qualifying for a home loan like a foreclosure.
And if you got out from under an oppressive mortgage through a short sale — when the bank agrees to accept less than what the homeowner owes — lenders can look upon you just as unfavorably.
It's a reality that the former owners of the more than 4 million homes lost to foreclosure in the six years since the housing bubble burst will have to confront if they want to own again. But the passage of time makes all the difference.
That's because mortgage-lending guidelines that most banks follow prohibit them from making loans to people with foreclosure or a short sale in their credit history, often for years. Never mind the hit that one's credit score takes.
Still, some of the homeowners who were foreclosed upon when the market first started to skid are now looking to buy and getting loans.
“They're probably going to pay a little higher interest rate, but with rates so low, a higher interest rate of 4 percent is not a big deal,” said Rosa Herwick, a broker and owner of Century 21 JR Realty in Henderson, Nev.
So how likely are banks to approve your mortgage application if you have a real estate-related blemish on your record? And can you do anything to spring yourself from the mortgage penalty box?
It depends on several factors, but largely on whether you had a foreclosure or a short sale.
Foreclosure
Generally, borrowers who have a foreclosure in their credit history can expect to wait two to seven years before a lender will even accept their loan application.
The waiting periods stem from guidelines most banks must follow in order to be able to sell their home loans. That's because potential purchasers, such as Fannie Mae and Freddie Mac, each have a different set of guidelines for the loans they will buy and criteria for whom they deem a qualified borrower.
The fact is, a person's credit score, employment history and other factors that make up one's creditworthiness will take a back seat to these resale guidelines.
If a buyer with a past foreclosure is seeking a government-backed mortgage, the waiting period can vary before they can qualify.
Take the Federal Housing Administration, which insures roughly 30 percent of new loans. Under its guidelines, former homeowners must wait three years from the date of their foreclosure before they can qualify for backing by the agency.
Compare the U.S. Department of Agriculture's housing program, which requires three years, while the time penalty for a VA loan is two years. Fannie Mae and Freddie Mac, which own or guarantee about half of all mortgages, require the longest stretch: seven years after a foreclosure.
In some cases, the waiting periods for a foreclosure can be reduced.
Fannie Mae, for example, allows a three-year waiting period in the event the foreclosure was due to an extenuating circumstance. The company defines this as an event that was beyond the homeowner's control and resulted in a sudden reduction in income or catastrophic increase in financial obligations. Think job layoff, medical bills or divorce.
FHA may grant an exception to its waiting period in the event a wage-earner becomes seriously ill or dies. A divorce may qualify for an exception, but only in certain cases.
Short Sales
The roadblocks for having a short sale in your credit history can be less severe, and in some cases, waived altogether.
FHA requires borrowers who weren't paying their mortgage when they sold their house to wait three years before they can qualify for a home loan. That time penalty may be waived in certain cases, including long-term job loss.
There is no FHA time penalty for homeowners who made their house payments in the 12 months before their short sale.
The size of a down payment can also shorten the waiting period.
A down payment of 20 percent or more will cut Fannie Mae's time penalty on a borrower with a short sale down to two years from seven. Buyers who put down 10 percent can qualify after four years.
Credit scores
It's no longer just a waiting game for homeowners caught up in the earliest stages of the foreclosure crisis in 2007 and 2008.
There's still the impact a foreclosure or short sale has on one's credit score - still very much a factor in qualifying for a loan.
Like most blemishes, foreclosures and short sales will remain in your credit history for seven years.
As a general rule, the higher your credit score, the more it will drop as a result of a bad debt, said Barry Paperno, consumer affairs manager for myfico.com, the consumer website for FICO.
FICO credit scores range from 300 to 850. In simulations, a foreclosure sent a FICO score of about 720 down to as low as 570 and took about seven years to recover fully, assuming everything else being equal.
Still, there are steps one can take to burnish one's tarnished credit rating.
While in the foreclosure penalty box, make sure to pay all your bills on time.
Get more credit. This may sound counterintuitive after a foreclosure, but beefing up your track record of good credit accounts can help boost one's credit score. A car loan or a credit card will do. But if you get a credit card, pay it off every month.
Be patient. A foreclosure's drag on your credit score will decline over time.
Dispute any mistakes on your credit report, which can lower your score.
Don't close your oldest credit accounts. Your score gets a boost from older credit lines.
Scale back your lifestyle, and pocket the savings toward a future down payment.
So I hope you took notes and here's a few tips to add to the list:
1) Keep copies of the checks for any/all payments made in the last 2 years of time you had made payments on the loan (even if they were partial payments) and keep these in a safe spot;
2) If you bank online, print out and keep the monthly statements;
3) Make it a habit to keep all pages of your bank statements (even if it's a blank). When a statement given to a Lender says it's one of 8 pages, they want to see all 8 pages. Just keep these with your tax data after filing yearly and recycle when your purge your tax files.
4) Start the same habit with your paystubs. Down the line this will be crucial;
5) Introduce yourself to AnnualCreditReport.com. This is a free service to order copies of your credit report (you must pay if you want scores but why bother for a few years). You can order one from each of the three companies but if you get in the habit of ordering one every 4 months, you have a rotating means of checking your credit and making sure there are no unexpected reports; and if so, you'll have time to deal with it.
So SHORT SALE SULLY says "GOOD LUCK" and I am here if you need me and like always ... Keep the faith!!!
Remedy for borrowers who suffered foreclosure in 2009 & 2010?
Do you believe you suffered through a foreclsoure procedure in error? If so and this occurred in 2009 or 2010, you may have another opportunity for remeption. You can request an independent foreclsoure review ...
The Federal Reserve and the OCC announced that the deadline for submitting requests for review under the Independent Foreclosure Review has been extended. The new deadline, July 31, 2012, provides an additional three months for borrowers to request a review if they believe they suffered financial injury as a result of errors in foreclosure actions on their homes in 2009 or 2010 by one of the servicers covered by enforcement actions issued in April 2011.
The deadline extension provides more time to increase awareness of how eligible people may request a review through the Independent Foreclosure Review process and to encourage the broadest participation possible.
As part of enforcement actions issued in April 2011, the OCC, Federal Reserve, and the Office of Thrift Supervision required 14 large mortgage servicers to retain independent consultants to conduct a comprehensive review of foreclosure activity in 2009 and 2010 to identify borrowers who may have been financially injured due to errors, misrepresentations, or other deficiencies in the foreclosure process. If the review finds that financial injury occurred, the borrower may receive compensation or other remedy.
Borrowers are eligible for an Independent Foreclosure Review if they meet the following basic criteria:
The mortgage loan was serviced by one of the participating mortgage servicers; The mortgage loan was active in the foreclosure process between January 1, 2009 and December 31, 2010; and The property securing the mortgage loan was the borrower's primary residence.
Participating mortgage servicers include: America's Servicing Company, Aurora Loan Services, BAC Home Loans Servicing, Bank of America, Beneficial, Chase, Citibank, CitiFinancial, CitiMortgage, Countrywide, EMC, Everbank/Everhome Mortgage Company, Financial Freedom, GMAC Mortgage, HFC, HSBC, IndyMac Mortgage Services, MetLife Bank, National City Mortgage, PNC Mortgage, Sovereign Bank, U.S. Bank, Wachovia Mortgage; Washington Mutual, Wells Fargo; and Wilshire Credit Corporation.
There is no cost associated with being included in the review. For more information, borrowers can call 888-952-9105, Monday through Friday, 8 a.m.-10 p.m. ET or Saturday, 8 a.m.-5 p.m. ET or visit one of the following websites www.federalreserve.gov/consumerinfo/independent-foreclosure-review.htm or www.occ.gov/independentforeclosurereview.
As always ... Keep the faith
The Federal Reserve and the OCC announced that the deadline for submitting requests for review under the Independent Foreclosure Review has been extended. The new deadline, July 31, 2012, provides an additional three months for borrowers to request a review if they believe they suffered financial injury as a result of errors in foreclosure actions on their homes in 2009 or 2010 by one of the servicers covered by enforcement actions issued in April 2011.
The deadline extension provides more time to increase awareness of how eligible people may request a review through the Independent Foreclosure Review process and to encourage the broadest participation possible.
As part of enforcement actions issued in April 2011, the OCC, Federal Reserve, and the Office of Thrift Supervision required 14 large mortgage servicers to retain independent consultants to conduct a comprehensive review of foreclosure activity in 2009 and 2010 to identify borrowers who may have been financially injured due to errors, misrepresentations, or other deficiencies in the foreclosure process. If the review finds that financial injury occurred, the borrower may receive compensation or other remedy.
Borrowers are eligible for an Independent Foreclosure Review if they meet the following basic criteria:
The mortgage loan was serviced by one of the participating mortgage servicers; The mortgage loan was active in the foreclosure process between January 1, 2009 and December 31, 2010; and The property securing the mortgage loan was the borrower's primary residence.
Participating mortgage servicers include: America's Servicing Company, Aurora Loan Services, BAC Home Loans Servicing, Bank of America, Beneficial, Chase, Citibank, CitiFinancial, CitiMortgage, Countrywide, EMC, Everbank/Everhome Mortgage Company, Financial Freedom, GMAC Mortgage, HFC, HSBC, IndyMac Mortgage Services, MetLife Bank, National City Mortgage, PNC Mortgage, Sovereign Bank, U.S. Bank, Wachovia Mortgage; Washington Mutual, Wells Fargo; and Wilshire Credit Corporation.
There is no cost associated with being included in the review. For more information, borrowers can call 888-952-9105, Monday through Friday, 8 a.m.-10 p.m. ET or Saturday, 8 a.m.-5 p.m. ET or visit one of the following websites www.federalreserve.gov/consumerinfo/independent-foreclosure-review.htm or www.occ.gov/independentforeclosurereview.
As always ... Keep the faith
Thursday, January 19, 2012
Expansion of California anti-deficiency legislation explained
In a recent issue of California Real Estate, Linda A. Kirios, Esq (Counsel to the California Association of Realtors, presents commercial educational programs throughout California and practices commercial Real Estate)answered the question: I have heard that the anti-deficiency legislation in California has been expanded. Can you shed soe light on that?
Cut and paste for her answer:
http://www.onlinedigitalpubs.com/publication/?i=89118&p=11
Cut and paste for her answer:
http://www.onlinedigitalpubs.com/publication/?i=89118&p=11
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