foreclosures http://www.wisebread.com/taxonomy/term/9585/all en-US The Housing Market Is Finally Rebounding http://www.wisebread.com/the-housing-market-is-finally-rebounding <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-housing-market-is-finally-rebounding" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="/files/fruganomics/imagecache/250w/blog-images/4629169207_05751fefb6_z.jpg" alt="sale sign" title="sale sign" class="imagecache imagecache-250w" width="250" height="188" /></a> </div> </div> </div> <p>The housing market is rebounding. Really.</p> <p>After many premature predictions and optimistic announcements, the housing market has indeed turned a corner. Home prices and sales are up. Foreclosures and mortgage delinquencies are down.</p> <p>Average home prices in the top 20 metro areas were up 1.6% in July from a year ago, according to the S&amp;P/Case Shiller Home Price Indices. All 20 cities in the index reported rising home prices for the third month in a row.</p> <p>&quot;All in all, we are more optimistic about housing. Upbeat trends continue,&quot; said David M. Blitzer at S&amp;P Dow Jones Indices.</p> <p>The median existing-home price, including all housing types, was $183,900 in September, up 11.3% from a year ago, according to the National Association of Realtors. The year-over-year monthly home prices have increased for seven months in a row. The last time that happened was from November 2005 to May 2006.</p> <p>&quot;Despite occasional month-to-month setbacks, we're experiencing a genuine recovery,&quot; said Lawrence Yun, NAR chief economist. &quot;More people are attempting to buy homes than are able to qualify for mortgages, and recent price increases are not deterring buyer interest.&quot; (See also: <a href="http://www.wisebread.com/what-it-really-costs-to-own-a-home">What It Really&nbsp;Costs to&nbsp;Own a Home</a>)</p> <h2>The Buyer's Market Is Over</h2> <p>What's more, the buyer's market may be coming to an end as sentiment begins to favor sellers. A survey by RedFin, a technology-based real estate brokerage firm, showed that homebuyers believe the market may be shifting against them. Out of 982 homebuyers polled this summer, 46% said they believe that now is a good time to buy. That was down from 56% in the first quarter and 48% in the second quarter. Thirty-two percent think now is a good time to sell, up from 13% in the first quarter and 28% in the second quarter.</p> <p>Importantly, many homebuyers, 61%, believe home prices will increase, up from 32% in the first quarter. More buyers are coming across competition or even bidding wars for a limited number of homes being sold &mdash; 71% of respondents reported encountering competition on at least one offer.</p> <p>Homes are also selling faster. The median time on the market in September dropped 30.7% from 101 days in September 2011, another indication that housing has strengthened.</p> <h2>Too Many Buyers for Homes</h2> <p>The problem for home buyers is the shortage of homes being sold. In parts of the West, the shortage is especially acute, Yun said. The number of existing homes listed for sale fell 3.3% to 2.32 million at the end of September. That's down 20% from a year ago.</p> <p>Fewer homes being sold means rising prices, a trend that will accelerate unless home builders ramp up construction fast, Yun said.</p> <p>Why the shortage? Homeowners who bought their homes before the housing bubble bust are unwilling to sell now and take a loss. Homebuilders all but stopped home construction during the recession, and a wave of foreclosures hitting the market has failed to materialize.</p> <h2>Home Buying Is for the Fast and Ready</h2> <p>Real estate agents advise home buyers &mdash; don't fret about home price trends. If you love a house and are comfortable with the mortgage payments, make an offer.</p> <p>If you want to buy a home, don't keep waiting in an attempt to &quot;<a href="http://www.wisebread.com/once-again-safe-as-houses">wait for the bottom</a>.&quot; By the time you've concluded home prices have hit bottom, they'll probably already be rising. And even if prices do fall in your area, interest rates may rise. That will make mortgages more expensive, defeating the purpose of seeking affordable housing.</p> <p>Don't be too picky. You might not find your dream house, especially with fewer homes on the market than potential home buyers. Don't worry about appliances, colors of the walls, or weeds in the yard. You can always replace a refrigerator and paint walls latter.</p> <p>Be ready and fast. Obtain <a href="http://www.wisebread.com/buying-first-home/home-loans">mortgage preapproval</a>. Submit your financial documentation to a lender to get preapproval for a maximum home loan amount. Get to know the neighborhood where you're house hunting. Learn about multiple-offer situations and plan out what you'll do.&nbsp;</p> <h2>Should You Buy a House Now?</h2> <p>So should you should you rush to by a home before home prices increase even more? It depends.</p> <p>Because real estate is local, prices in your area might not follow national trends or the trend in a nearby metro area. Examine local home values when you're home shopping, not national or regional price indexes.</p> <p>Regardless of the home price outlook, before you jump into home buying, your personal and career situation should be settled enough for you to stay put for at least a few years. Buying a home is not like speculating in gold or stocks. You can sell a commodity like a stock fairly easily, but when you buy real estate, you pay an assortment of mortgage closing costs and fees. When you sell, you pay the real estate agent a commission. For that reason, you should plan to keep the property for at least several years to make the investment worthwhile.</p> <p>Your financial house, so to speak, should be in order, your credit good enough to obtain a favorable home loan rate, and a savings large enough for a down payment &mdash; ideally at least 10% but ideally 20% to avoid private mortgage insurance, which insures the lender and brings no benefit to you.</p> <p>You should be ready to pay for maintenance and repairs or to <a href="http://www.wisebread.com/5-household-fixes-you-should-stop-paying-others-for">fix things yourself</a>. Unlike a renter who calls the landlord when a faucet leaks, you'll be responsible for mowing the lawn and fixing anything that breaks.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/michael-kling">Michael Kling</a> of <a href="http://www.wisebread.com/the-housing-market-is-finally-rebounding">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-cost-of-a-free-ride-why-not-to-use-a-buyers-agent-submitted-by-ken-rick">The cost of a free ride - why not to use a buyer&#039;s agent</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-process-for-purchasing-a-house-with-cash">The Process for Purchasing a House With Cash</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-fallacy-of-homeownership-as-a-sound-investment">The Fallacy of Homeownership as a Sound Investment</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/quiz-am-i-really-ready-to-buy-a-home">Quiz: Am I Really Ready to Buy a Home?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-invest-in-goldman-sachs-gs">Should You Invest in Goldman Sachs (GS)?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Financial News Real Estate and Housing buying a house foreclosures housing market Fri, 16 Nov 2012 10:36:50 +0000 Michael Kling 955599 at http://www.wisebread.com Things You Should Know About HAFA: The Home Affordable Foreclosure Alternatives Program http://www.wisebread.com/things-you-should-know-about-hafa-the-home-affordable-foreclosure-alternatives-program <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/things-you-should-know-about-hafa-the-home-affordable-foreclosure-alternatives-program" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="/files/fruganomics/imagecache/250w/blog-images/shortsale.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="166" /></a> </div> </div> </div> <p>On April 5, 2010 a new program called the <a href="https://www.hmpadmin.com/portal/docs/hamp_servicer/sd0909.pdf">Home Affordable Foreclosure Alternatives</a>, or HAFA, will further expand the <a href="http://www.wisebread.com/details-of-obamas-mortgage-plan-released-will-you-benefit">foreclosure prevention efforts</a> of the Obama administration. This program is meant to encourage short sales instead of foreclosures. Here are some details about the program and the issues troubled homeowners should consider before applying.</p> <p>A short sale is basically a home sale where the lender forgives a part of the loan. For example, an underwater borrower could currently have a mortgage debt of $300,000, but the house is only worth $200,000. In this case the lender could approve a short sale of $200,000 and forgive the rest of the debt. Unfortunately, currently many short sales do not close escrow mostly due to slow approval on the part of the lenders. The purpose of HAFA is to give incentives to sellers, lenders, and investors to complete short sales.</p> <p>To qualify for HAFA borrowers must meet the following requirements:</p> <ul> <li>The loan has to be a first lien mortgage originated on or before January 1, 2009. This means homes with second mortgages will not qualify since there is a second lender in the mix.</li> <li>The house in question must be the borrower's primary residence.</li> <li>The mortgage payments have to be more than 31% of the borrowers' incomes.</li> <li>The home also has to be listed by a broker, and not by the seller.</li> <li>The mortgage is delinquent and headed to default.</li> <li>The current unpaid balance on the mortgage has to be less than $729,750</li> </ul> <p>The cash incentives under HAFA is that the seller gets $1,500 in moving expenses, and the lenders approving the short sale would get $1,000.</p> <p>Before attempting any short sale, homeowners should check the tax consequences because the forgiven debt may count as ordinary income and end up being taxed. Usually after a short sale the lender will send the seller a 1099 at the end of the year showing the amount of debt that was forgiven. Currently in California those who got rid of their homes in short sales in 2009 <a href="http://articles.sfgate.com/2010-03-15/news/18831718_1_short-sales-tax-bill-tax-conformity">are on the hook for huge tax bills</a> because California's income tax law treats the forgiven debt as ordinary income. The IRS currently has an federal tax exemption on the forgiven debt due to the Mortgage Forgiveness Debt Relief Act of 2007, but this exemption is temporary and expires in 2012. The federal tax exemption only applies to debt used to purchase or improve a primary residence, so those who used cashed out their equity and bought other things would not qualify.</p> <p>Besides the issue of taxes, if you read the terms of HAFA more carefully you will see that the lender has the option to determine whether or not a short sale or deed in lieu of foreclosure is in the best interest of the lender. A deed in lieu of foreclosure is essentially a voluntary foreclosure and the lenders would save quite a bit of money if you agree to one since they do not have to go through the entire judicial process of a full foreclosure. If you participate in HAFA you actually agree to a deed in lieu of foreclosure if the short sale fails. The seller has to make payments during the short sale process during HAFA or the lender can immediately take the home via the deed in lieu clause. The HAFA agreement also says that the lender or investor must give at least 120 days for the sale, but if the home does not sell within 120 days the lender could just take the home via the deed in lieu of foreclosure.</p> <p>Will this program spawn a lot more short sales? Personally I think the terms of the program are ultimately not in the interest of the sellers. If you want to pursue a short sale it is probably best to start negotiating with your lender right now outside of HAFA.</p> <p><em>What do you think about this program? Have you ever completed a short sale?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/xin-lu">Xin Lu</a> of <a href="http://www.wisebread.com/things-you-should-know-about-hafa-the-home-affordable-foreclosure-alternatives-program">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-reasons-why-youre-too-old-or-too-young-for-a-mortgage-loan">4 Reasons Why You&#039;re Too Old — Or Too Young — For a Mortgage Loan</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/six-options-if-youre-underwater-on-your-mortgage">6 Options if You&#039;re Underwater on Your Mortgage</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/whats-faster-for-mortgage-payoff-100-month-extra-or-1-payment-year-extra">What&#039;s Faster for Mortgage Payoff: $100/Month Extra or 1 Payment/Year Extra?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-why-2015-is-the-year-to-buy-a-house">5 Reasons Why 2015 is the Year to Buy a House</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/front-loaded-loans-a-financial-conspiracy">Front-loaded loans: a financial conspiracy?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing foreclosures HAFA mortgages short sales Wed, 24 Mar 2010 14:00:10 +0000 Xin Lu 6010 at http://www.wisebread.com Are $1 homes worth buying? http://www.wisebread.com/are-1-homes-worth-buying <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/are-1-homes-worth-buying" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="/files/fruganomics/imagecache/250w/blog-images/dollar.jpg" alt="dollar bill" title="Dollar Bill" class="imagecache imagecache-250w" width="250" height="189" /></a> </div> </div> </div> <p>This week a story from The Detroit News reported that homes are being listed in Detroit for $1. One particular $1 home sold for cash after being on the market for 19 days. The buyer seems to have gotten the deal of a lifetime, but did she?</p> <p>As detailed in <a href="http://www.detnews.com/apps/pbcs.dll/article?AID=/20080813/METRO/808130360/&amp;imw=Y" target="_blank">the article</a> , the buyer will need to sink in a considerable amount of money to rehab the home to a livable state because everything of value including the kitchen sink have been stripped and stolen from the house. Even if she rehabs the home, as long as it stays vacant looters will steal whatever she puts in. Additionally, she will owe $3900 on the property taxes unless she challenges the assessment. Basically, that $1 purchase could very well turn into a very large money pit.</p> <p>One dollar homes are not exactly unique to Detroit. The Department of Housing and Urban Development or HUD for short regularly sells homes for $1 each to local governments through their <a href="http://www.hud.gov/offices/hsg/sfh/reo/goodn/dhmabout.cfm">Dollar Homes program</a> . The local government is responsible for rehabbing the homes and reselling them to moderate and low income families. So once again, a $1 home costs much more than $1 for the buyer.</p> <p>Another interesting place to buy $1 homes is Norfolk, MA. The town regularly <a href="http://www.virtualnorfolk.org/public_documents/norfolkma_historical/$1">sells historic homes </a> slated for demolition for $1. The catch is that if you buy the home you do not buy the land underneath it and you are required to move the home. It generally costs $10000 or more to move an entire home, but if you already have a plot of land it might not be such a bad deal. For those who do not have land, some homes might have antique finishings and raw materials that can be salvaged. </p> <p>Looking at all the options, it seems that even though these homes are 99.99% discounted they may not be such a good deal for most people. However, they might be a steal for those who have the time and resources to either salvage the raw materials or rehab them for future profit. One thing is clear, $1 homes never really cost just $1 and buyers should always be wary of anything that is extraordinarily cheap.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/xin-lu">Xin Lu</a> of <a href="http://www.wisebread.com/are-1-homes-worth-buying">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/do-not-buy-something-just-because-you-can-afford-it">Do not buy something just because you can afford it</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/seller-concessions-and-buyer-bargains-what-to-ask-for-in-the-current-real-estate-market">Seller concessions and buyer bargains - What to ask for in the current real estate market.</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/chinese-money-habits-how-my-culture-influences-my-attitudes-toward-money">Chinese Money Habits - How My Culture Influences My Attitudes Toward Money</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/making-home-affordable-expanded-again-borrowers-allowed-to-refinance-loans-up-to-125-percent-of-valu">Making Home Affordable expanded again - borrowers allowed to refinance loans up to 125 percent of value</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-skip-a-mortgage-payment-to-get-a-banks-attention">Should you skip a mortgage payment to get a bank&#039;s attention?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance General Tips Real Estate and Housing $1 deal foreclosures homes real estate Fri, 15 Aug 2008 01:43:17 +0000 Xin Lu 2332 at http://www.wisebread.com