MN Hud Homes

Underwater Homeowner Refinance Programs Extended For 1 More Year

FHFA Extends Refinance Program By One Year

Washington, DC — Federal Housing Finance Agency Acting Director Edward J. DeMarco has announced an extension of the Home Affordable Refinance Program (HARP), a refinancing program administered by Fannie Mae and Freddie Mac, to June 30, 2012. The program was set to expire on June 30 of this year. In addition, Fannie Mae and Freddie Mac will make the following adjustments to their programs: Freddie Mac will exempt HARP loans from their recently announced price adjustments and Fannie Mae will conform their eligibility date to May 2009.

The program expands access to refinancing for qualified individuals and families whose homes have lost value. HARP has grown over the past year. In 2010, Fannie Mae and Freddie Mac purchased or guaranteed more than 6.8 million refinanced mortgages. Of this total, 621,803 were HARP refinances with LTVs between 80 percent and 125 percent. This is up from 190,180 in 2009, when HARP began.

For more information on Fannie Mae and Freddie Mac refinance activity, see FHFA’s Fourth Quarter 2010 Foreclosure Prevention & Refinance Report. Additionally, homeowners can visit www.MakingHomeAffordable.gov for more information on the program.

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The Federal Housing Finance Agency regulates Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks. These government-sponsored enterprises provide more than $5.9 trillion in funding for the U.S. mortgage markets and financial institutions.

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WHY Pick RE/MAX?

There are lots of reasons why you might choose to select one agent or company vs another. Unless you have a best friend or relative who you “have” to use, I would like to show you how I am different. I believe I have an excellent value proposition as to why you would select me as your agent and RE/MAX as your company. I would welcome the opportunity to meet with you and discuss how I can help you meet your housing goals-whether it be buying or selling. Interview a couple of agents, you will see there is a difference. You may wonder how does RE/MAX stack up within the Twin Cities. The attached PDF’s will give you some market share information as well as agent productivity-based on a 2010 compilation of the numbers. While these are just some of the metrics on which to base your decision, success does leave clues. How can I help you?

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Down Payment Assistance Synopsis

Where there is a will, there is a way. There are many many programs today that are city specific. So, the attached synopsis is a multi county foreclosure down payment assistance pool. Basically, there is money available for purchasers of distressed homes. If you want to buy a home and are flexible in which area you make your purchase, we can try to find you some programs.

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Gifts and Grants can be considered towards borrowers funds on certain 3% down conventional loans

Yes, you read that right. I just got an email today from a leading mortgage insurance company that is willing to underwrite this loan. You will need at 740 or better score. But, what an opportunity. In many ways, this is like FHA, but with a little higher credit threshold. The KEY difference, besides credit score, is the lack of an upfront MI (mortgage insurance) premium and as well as a smaller required monthly premium. This product could be a game changer for the MI company and conventional loans.

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Purchase 80/10/10 and 80/5/15 STILL exists

As of this post, the 80/10/10 and 80/5/15 can still be done. While underwriting has allowed it, it has been very difficult to find a second mortgage product that would write a 5 or 10% second mortgage. Well, after many phone calls, we have sourced two lenders who at this time are willing to offer the second mortgage. One is a bank and the other is a credit union. As with EVERY program, the rules can and do change at any given moment. The key to both product is extremely high credit scores and a file that utilizes conservative ratios. If you don’t have at least a 700 score, this might not be something you can utilize at this time. For the 80/10/10, you will need a 740 or better score.

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What Is Your Home Worth Today?

I found a cool resource at http://www.FHFA.gov. If you go there, in the middle of the page you will find something called the Home Price Calculator. You input your home purchase information in terms of State, quarter in which you purchased and the quarter in which you’d like to get the valuation. Next, you hit calculate, and it will show you a chart. While it isn’t specific to YOUR exact home, it does give trends for your area. If you want specific information-specific to your home-within the Twin Cities metro-give me a call and we can discuss your situation. I can then give you guidance on what the value might be.

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Did you know-Current & Future Housing Data

Watch this video-then call me to help you buy or sell a new home or investment property.

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8 Tips For Finding Your New Home

A solid game plan can help you narrow your homebuying search to find the best home for you.

House hunting is just like any other shopping expedition. If you identify exactly what you want and do some research, you’ll zoom in on the home you want at the best price. These eight tips will guide you through a smart homebuying process.

1. Know thyself
Understand the type of home that suits your personality. Do you prefer a new or existing home? A ranch or a multistory home? If you’re leaning toward a fixer-upper, are you truly handy, or will you need to budget for contractors?

2. Research before you look
List the features you most want in a home and identify which are necessities and which are extras. Identify three to four neighborhoods you’d like to live in based on commute time, schools, recreation, crime, and price. Then hop onto REALTOR.com to get a feel for the homes available in your price range in your favorite neighborhoods. Use the results to prioritize your wants and needs so you can add in and weed out properties from the inventory you’d like to view.

3. Get your finances in order
Generally, lenders say you can afford a home priced two to three times your gross income. Create a budget so you know how much you’re comfortable spending each month on housing. Don’t wait until you’ve found a home and made an offer to investigate financing.

Gather your financial records and meet with a lender to get a prequalification letter spelling out how much you’re eligible to borrow. The lender won’t necessarily consider the extra fees you’ll pay when you purchase or your plans to begin a family or purchase a new car, so shop in a price range you’re comfortable with. Also, presenting an offer contingent on financing will make your bid less attractive to sellers.

4. Set a moving timeline
Do you have blemishes on your credit that will take time to clear up? If you already own, have you sold your current home? If not, you’ll need to factor in the time needed to sell. If you rent, when is your lease up? Do you expect interest rates to jump anytime soon? All these factors will affect your buying, closing, and moving timelines.

5. Think long term
Your future plans may dictate the type of home you’ll buy. Are you looking for a starter house with plans to move up in a few years, or do you hope to stay in the home for five to 10 years? With a starter, you may need to adjust your expectations. If you plan to nest, be sure your priority list helps you identify a home you’ll still love years from now.

6. Work with a REALTOR®
Ask people you trust for referrals to a real estate professional they trust. Interview agents to determine which have expertise in the neighborhoods and type of homes you’re interested in. Because homebuying triggers many emotions, consider whether an agent’s style meshes with your personality.

Also ask if the agent specializes in buyer representation. Unlike listing agents, whose first duty is to the seller, buyers’ reps work only for you even though they’re typically paid by the seller. Finally, check whether agents are REALTORS®, which means they’re members of the NATIONAL ASSOCIATION OF REALTORS®. NAR has been a champion of homeownership rights for more than a century.

7. Be realistic
It’s OK to be picky about the home and neighborhood you want, but don’t be close-minded, unrealistic, or blinded by minor imperfections. If you insist on living in a cul-de-sac, you may miss out on great homes on streets that are just as quiet and secluded.

On the flip side, don’t be so swayed by a “wow” feature that you forget about other issues—like noise levels—that can have a big impact on your quality of life. Use your priority list to evaluate each property, remembering there’s no such thing as the perfect home.

8. Limit the opinions you solicit
It’s natural to seek reassurance when making a big financial decision. But you know that saying about too many cooks in the kitchen. If you need a second opinion, select one or two people. But remain true to your list of wants and needs so the final decision is based on criteria you’ve identified as important.

G.M. Filisko is an attorney and award-winning writer who has found happiness in a brownstone in a historic Chicago neighborhood. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

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4 Tips to Determine How Much Mortgage You Can Afford

By knowing how much mortgage you can handle, you can ensure that home ownership will fit in your budget.

Here are six surefire ways you can get your finances in order before you buy a home.

Homeownership should make you feel safe and secure, and that includes financially. Be sure you can afford your home by calculating how much of a mortgage you can safely fit into your budget.

Instead of just taking out the biggest mortgage a lender qualifies you to borrow, consider how much you want to pay each month for housing based on your financial and personal goals.

Think ahead to major life events and consider how those might influence your budget. Do you want to return to school for an advanced degree? Will a new child add day care to your monthly expenses? Does a relative plan to eventually live with you and contribute to the mortgage?

Still not sure how much you can afford? You can use the same formulas that most lenders use, or try another of these traditional methods for estimating the amount of mortgage you can afford.

1. The general rule of mortgage affordability
As a rule of thumb, you can typically afford a home priced two to three times your gross income. If you earn $100,000, you can typically afford a home between $200,000 and $300,000.

To understand how that rule applies to your particular financial situation, prepare a family budget and list all the costs of homeownership, like property taxes, insurance, maintenance, utilities, and community association fees, if applicable, as well as costs specific to your family, such as day care costs.

2. Factor in your downpayment
How much money do you have for a downpayment? The higher your downpayment, the lower your monthly payments will be. If you put down at least 20% of the home’s cost, you may not have to get private mortgage insurance, which costs hundreds each month. That leaves more money for your mortgage payment.
The lower your downpayment, the higher the loan amount you’ll need to qualify for and the higher your monthly mortgage payment.

3. Consider your overall debt
Lenders generally follow the 28/41 rule. Your monthly mortgage payments covering your home loan principal, interest, taxes, and insurance shouldn’t total more than 28% of your gross annual income. Your overall monthly payments for your mortgage plus all your other bills, like car loans, utilities, and credit cards, shouldn’t exceed 41% of your gross annual income.

Here’s how that works. If your gross annual income is $100,000, multiply by 28% and then divide by 12 months to arrive at a monthly mortgage payment of $2,333 or less. Next, check the total of all your monthly bills including your potential mortgage and make sure they don’t top 41%, or $3,416 in our example.

4. Use your rent as a mortgage guide
The tax benefits of homeownership generally allow you to afford a mortgage payment—including taxes and insurance—of about one-third more than your current rent payment without changing your lifestyle. So you can multiply your current rent by 1.33 to arrive at a rough estimate of a mortgage payment.

Here’s an example. If you currently pay $1,500 per month in rent, you should be able to comfortably afford a $2,000 monthly mortgage payment after factoring in the tax benefits of homeownership.

However, if you’re struggling to keep up with your rent, consider what amount would be comfortable and use that for the calcuation instead.

Also consider whether or not you’ll itemize your deductions. If you take the standard deduction, you can’t also deduct mortgage interest payments. Talking to a tax adviser, or using a tax software program to do a “what if” tax return, can help you see your tax situation more clearly.

G.M. Filisko is an attorney and award-winning writer who’s owned her own home for more than 20 years. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

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Who Manages The HUD Homes?

The country is divided into different areas. Each area works with different companies. In addition, some areas have different rules. For example, the $100 down program is not available in all areas of the country. Like everything these days, you need to check on availability. To determine who is the manager, go to this map http://www.hud.gov/offices/hsg/sfh/reo/mm/mm3map.pdf

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Minnesota Foreclosure comparison report

A very interesting year over year foreclosure report was just released. It takes the MN foreclosure crisis and breaks down the data into micro data. It is definitely worth looking at if you want to identify trends and opportunities.
http://www.hocmn.org/Stock/Editor/file/REPORTS/2010_YrEnd_ForeclosureCount/2010_Annual_ForeclosuresInMN.pdf

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Two Special Twin Cities Home Buying Programs

One program is called FPP-Foreclosure Partnership Program, and the other is NSP2 Homebuyer Assistance Program.  Both programs offer incentive money for a purchase.  I can use these financing programs with one of our mortgage investors.  Consider checking them out to see if they’d work for you.

HennipenCounty-Non-forclosedHomes-overview

HennipenCounty-Nsp2-overview

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You CAN do an FHA short sale

HUD recently issued guidance on this issue. IF you have an FHA loan, call me and we can work through the discussion of whether or not you may qualify for a short sale. See the HUD letter below.

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HAFA Update-More Beneficial

Apparently the OLD HAFA wasn’t as successful as hoped. Yet, the program had some great attributes. They’ve just tweaked it, and are about to roll out a new improved version. See the sheet between for a comparison. The ability to pay the second lien holder a larger amount to make a settlement is what I feel will allow more HAFA short sales to close.

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Rebuilding Credit To Get A Mortgage

Often, especially in this market due to the recession, we find potential home buyers who have had a life event or “bump in the road” that affects their ability to obtain a new loan. If you want to buy a home, you will have to have a certain number of reporting trade lines and for certain length of time. MOST mortgage programs require 3-5 trade lines and a minimum of two years of reporting. The other criteria is the actual credit score-which generally has to be 620, 640 or even 660 as it is all lender dependent. A manual underwriting where they use alternative credit such as rent payments, cell phone bill, utility bills, and the cable bill might be able to be used-but only with a few certain programs and lenders. So, the best bet is to re-establish credit as quickly as possible. HOW ABOUT NOW!! Don’t wait-it will only extend the time until you are going to be eligible. I have put together a list of resources that might be helpful. This list is only a starting place for your research. If you find another good resource please post it in the comments below so that the list can be expanded upon.

TOP IDEAS FOR CREDIT RE.doc

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Projected Loss Severity Of A Foreclosure-both 2010 & 2011

Short sales are probably going to be the loss mitigation method of choice.  When you look at the loss severity of a foreclosure, you can see why some other method might be preferable.  Look at the Fitch ratings report here and see for yourself.  This may be useful information when negotiating with the banks and servicer.

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Buying Rental Property In The Twin Cities

Have you ever wanted to own rental property, but were unsure where to start? I teach a class on the topic. I’ve decided to make the outline into a PPT. I cover the information in my class in much more depth and breadth, but this will give you a lot of useful information. If you are interested in discussing purchasing a rental property as an investment, just give me a call and we can set up a time to meet and review how I can help you become a “real estate mogul”.

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Mortgage Insurance May Still Be Deductible For Some Buyers

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Is There An Opportunity Right In Front Of YOU

I just watched an amazing video which I’ve posted below called the Money Tree. There are so many different interpretations. One that struck me was that people are oblivious to opportunity that is right in front of them. How many of us are looking for something that we already have or is within our reach? How many people are NOT buying real estate today when they could be looking at this as an incredible wealth building opportunity for what it is over the long term-assuming properties rise again in value? I was showing homes this past weekend. It was incredible to see townhomes in great communities selling for 40-60% less than they had sold for just as little as 5 years before. Luckily for my client, we are going to make an offer and ACT. Watch this video and don’t let the opportunities in your life pass you by. Don’t let life pass you by. Happy New Year and may 2011 be your best yet!

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December Is The Time To Reflect

Are each of us doing all we can to make the world a better place? Many of us have our favorite charity and organizations we support. RE/MAX is a very large sponsor of Children’s Miracle Network. Many people don’t realize how much has been given. Each time I sell a home, I automatically donate a portion of my commission to this organization. Other RE/MAX agents like myself contribute from their commission checks as well. Together, with RE/MAX we have collectively given over 100M. I would encourage everyone to consider finding an organization they believe in and make giving a part of their life. Just imagine what the world could look like?

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Short Sales Are Today’s Investor Opportunity

Short sales can be win win transactions for everyone. Take a look at the video and give me a call to get started.

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Getting Ready to Sell Your House

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HUD Has A YouTube Channel-Here Is There Vid On Buying A Home

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Google lets you create cool templated websites

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Can Home Ownership Contribute To Your Wealth?

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Minnesota Foreclosure And Distressed Home Fact Sheets PLUS Twin Cities First Time Buyer Special Programs

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What Does The Foreclosure Moratorium Mean To A Distressed Homeowner?

Check out the PDF and share with your friends/family who might need this information.

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Minnesota First Time Home Buyer Tips

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Top Seven Tips For Home Buyers

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The Difference Between Judicial And Non-Judicial Foreclosures

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Foreclosure resource page

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Possible Effects From The Foreclosure Halt

By Rob Minton & John Mazzara

In case you’ve somehow missed it, many of the largest U.S. mortgage servicing companies have halted foreclosures. Ally Financial’s GMAC Mortgage, Bank of America, JP Morgan and PNC have stopped foreclosures in many states – BOA has, in fact, put a moratorium on foreclosures in all 50 states.

Pressing the pause button on foreclosures came as the result of several states’ attorneys general inquiring into the validity of foreclosure judgments for which mortgage servicers did not properly handle documents.
The “blind stamping” of documents – signing off on documents without really reading them – has come under fire after one manager admitted to signing off on about 8,000 foreclosure documents a month without reading them to verify facts. The mortgage companies have halted foreclosures while they investigate practices in their foreclosure processes.

Of course, it being an election year and all, members of congress are calling for a federal probe of lender misconduct. In the short-term anyway, the halt in foreclosures might give some struggling homeowners a little extra time to get on their feet. It might finally lead to overworked employees at busy banks getting the help they need to properly handle foreclosures, and it should make banks a little more willing to work with homeowners to modify distressed loans. With fewer foreclosures hitting the market, home values in some areas might creep up.

There are some long-term effects, though, that can’t be ignored. And some of them are downright troubling.
First, the halting of foreclosures for any period of time by banks that hold as many mortgages as these firms do is going to stop up the pipeline. Tons of foreclosed homes hit the market over the past two or three years, but there are more coming. Stalling that flow of homes now is going to drag out the process for a longer period of time. That means, for one, likely longer pressure on home values. Most experts will agree: The inventory of unsold homes on the market, many of them foreclosures, has to get smaller before home values will stabilize completely.

The effect on the volume of homes sales could be staggering if the moratorium lasts longer than a month or two, and/or if more servicing companies join the party. Across the U.S., foreclosures make up about 30 percent of all home sales. In California, Florida, Nevada – the states that have been hit hard by foreclosure – they make up a considerably larger percentage of all sales.

It’s also safe to assume that title insurance companies are going to be reluctant to insure titles on homes that have been foreclosed. That could be a huge problem because no lender is going to make a loan on home without an insured title. And what happens if the bank has already re-sold homes that were invalid foreclosures? Are the title insurance companies going to have to pay the new buyers?

On top of all that, the whole mess is going to make potential real estate buyers even more nervous about the market, which is already dealing with a huge drop in demand since the federal government’s tax credits for home buyers expired. Perhaps the delay in the flood of foreclosed homes to the market will give time for demand to return, but more likely is yet another “doom and gloom” real estate scenario that will scare buyers and investors off.

Hopefully, the big lenders agreement to halt foreclosures was a gesture of good faith made to the attorneys general, a sign that the firms are taking seriously the matter of following proper procedure in foreclosures. Hopefully, investigations will determine that for the most part, the banks are doing things the right way and will be able to move on.

Because while the short-term effects of the halt might seem attractive, a long-term foreclosure problem would not be good for anybody involved in real estate. In Minnesota, the market has definitely slowed, but some of this is seasonal. I think that the foreclosure issue will put more pressure on all parties involved to pursue short sales. Short sales are generally less expensive-in terms of loss-to the lender. Also, a short sale generally is viewed more positively on your credit. So, why aren’t more short sales being pursued? Rather than give you my conspiracy theory and explain who makes money throughout the foreclosure process, I would simply encourage you to follow the money.

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Monitor Foreclosure Fraud From Around The Country

Have you heard of the “think big work small” guys?  Unless you are in the mortgage or real estate industry, you may not know who they are.   In a nutshell, they are awesome.  They produce a 5 minute daily video synopsis of what’s happening in our industries.  Today’s video referenced a new site called http://www.4closurefraud.org I went there to take a look.  It is another excellent resource for anyone who wants to monitor articles and information regarding foreclosure fraud-meaning foreclosures done incorrectly with the likes of robo signers, faulty documentation, and more.  Go there and bookmark for future reference.

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Lenders Are Halting Foreclosures-Temporarily

Not all lenders, but a few of the largest-including Bank Of America- have recently suspended foreclosures in all 50 states. What will be the outcome and when will they move forward again with the process? It is all an unknown at this time. What we do know, is that they may not have processed the paperwork properly. Now, it appears they will be reviewing everything twice before they go forward. Ultimately, the end result will probably end with the home being foreclosed upon if the homeowner is actually behind and there hasn’t been a modification. But for many, this reprieve will probably be a nice relief in this tough economy. Here is a link to a recent article from our local paper http://www.startribune.com/business/104612084.html?page=3&c=y

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Here’s What The Federal Reserve Has To Say

There is an interesting report from the Federal Reserve entitled REO and Vacant Properties http://www.bos.frb.org/commdev/REO-and-vacant-properties/REO-and-vacant-properties.pdf You can read/download the report at this link.

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There is a NEW HUD HOME lookup site

HUD is marketing their homes on site located at http://www.HUDhomeStore.com At this site you will be able to locate the HUD Home inventory on a national basis.  All these homes will make it into the MLS as well, but if you are specifically inquiring on a HUD property, this the place to look first.

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Data.gov – A Cool Site With Lots Of Great Info

http://www.Data.gov I just found this site and wanted to share it.  It has a ton of info and reports.  If you have a project or just an “inquiring mind”, this is sure to be a hit.  Check it out and get the data you need.

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Homepath.com is Fannie’s Foreclosure Portal

Fannie Mae posts their foreclosured properties with a Realtor of their choice and also on http://www.HomePath.com.  What is cool about a Homepath property is that many times they will qualify for Homepath loans (requiring only 3% down) and no appraisal.  They also have a homepath Renovation loan.  There is a program called FirstLook, which allows certain selected developers and non profits to purchase these homes for rehabilitation first, so you might loose a home that is really a good deal. Still, don’t let this deter you.  I recently sold a home in Brooklyn Center that was a HomePath property.  It was pretty nice, just a little dirty. Because it was in very good shape, we were able to use FHA financing.  I’ve found that FHA financing is cheaper than Homepath with a minimum down payment.  We’ll have to see if that changes in the future.

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Answers to Some of the Most Common Questions About HUD Homes

By Seomul Evans

With the financial crisis still looming large over the country’s economy; this sure is a good time to purchase real estate. As a matter of fact, you can get some of the cheapest deals ever seen on HUD homes. If you are interested in buying a HUD code home and have questions about the buying process and the homes in general; then here are some answers for you:

What is the definition of a HUD Code home?

When people who cannot pay their FHA insured mortgage, the lender forecloses the home and HUD in turn purchases the homes from the lender becoming the owner of the property. Then the Department of Housing and Development (HUD) offers the property for sale to recover their losses. HUD tries to sell the house at market value and since time is of essence to them so these homes are auctioned off.

Who can purchase a HUD home?

Almost anybody can bid on a HUD home. If you have enough liquidity or if you are pre-qualified for a mortgage, you can bid on a HUD if you have a pre-approved mortgage or if you have enough funds to purchase the home. There are; however, certain restrictions that the purchase is subjected to and if you qualify, you can certainly buy a HUD home. Even HUD employees and their relatives are eligible to buy a home but they will need to get a written approval from the HUD Director.

Are HUD homes only appropriate for people in the lower income group?

HUD homes are certainly the cheapest housing options in the market today; they are suitable for people from the lower and the middle income groups.

Can I really get a HUD home for a dollar?

No, the purchase price of a HUD home is at par with the current market value of the property; this means that the price of a HUD home is based on the price of other similar homes in the area

Is HUD responsible for any repair work that need to be undertaken to upgrade the home to HUD compliance?

HUD is not responsible and nor will the department incur the cost of any repair work that needs to be undertaken to upgrade the house to be compliant with HUD code. These homes are sold “as-is” which means that there is no warranty on them. The asking price of a home is based on the condition of the home and will often be indicative of the fact the new owner will have to invest in order to renovate the premises. HUD may sometimes offer an allowance to upgrade the property or for moving expenses or a bonus for the early closing of the sale. The buyer can also request the department to pay a part of the closing or financing cost. Consult with your real estate agent or a HUD code attorney to get more details on what you are eligible for. It is also imperative to get the home inspected by a professional engineer so that you can get a fair idea about the amount of money that will have to be spent to upgrade the home and submit an appropriate bid.

Can I get a loan to buy a HUD home?

HUD does not offer loans directly; however there are several mortgage programs that HUD endorses. There is a lot of information about these lenders on the HUD website, you can read up and get in touch with these HUD approved lenders, so that they can take you through the right steps and ensure that you have good chance of getting the loan.

How can I find out about the HUD homes for sale in my area?

There are several websites that offer information on HUD homes try searching with the help of a search engine. Also, you should be able to find out about the HUD registered real estate agents in your area. It is important t consult with a HUD code attorney and a registered real estate agent when purchasing HUD properties. They are well versed in the requirements, limitations and possible issues that you may face while and after buying a HUD home.

Seomul evans is a SEO Services consultant for California Hud Code Attorney

Article Source: http://EzineArticles.com/?expert=Seomul_Evans
http://EzineArticles.com/?Answers-to-Some-of-the-Most-Common-Questions-About-HUD-Homes&id=4858080

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Buying HUD Homes As Investments

By Steven Gillman

Buying HUD (Department of Housing and Urban Development) homes isn’t necessarily a way to get rich quick. These homes are supposed to be sold at market value, after all, which would seemingly make the great deals you hear about a myth. However, there are some profit opportunities here.

One of the reasons you still find good deals on HUD homes – even though they are supposed to sell at market value – is that they are sold “as is.” These are houses that have been foreclosed on and repossessed, so the previous owner may not have had the means nor the motivation to properly care for the home. They often have enough problems to scare away most home buyers.

What does this mean? It means that due to the condition, the market value may be low compared to properly-maintained homes. This can mean an opportunity for an investor who is willing to fix a few things. For example, to the general public, a “problem house” can be worth $40,000 less than surrounding homes, while it may take only $10,000 make it look good again.

Buying HUD Homes

What is a HUD home? It is a house that has a HUD-insured mortgage loan on it. When the owner doesn’t make the payments, HUD pays the lender what is owed, and then takes ownership of the home. They try sell it quickly, and at market value. Virtually anyone who can pay cash or get a loan is eligible to buy these houses. (HUD employees and relatives of HUD employees are eligible, but must receive written approval from the Director of HUD’s Office of Single Family Asset Management in order to purchase a HUD-owned single family property.)

HUD homes are found in all sorts of neighborhoods, although most are meant to be affordable to low-income and moderate-income families. These are homes that generally sell for the same as surrounding homes (except when they need work). To find HUD homes in the price range you want, then, you simply look for neighborhoods with homes in that price range.

If A HUD house need fixing up the asking price will reflect that. HUD may offer special incentives such as an allowance to upgrade the property, a moving expense allowance, or a bonus for closing the sale early. The houses are sold “as is,” but HUD will allow you to get professional inspections prior to making an offer. The cost of these will be yours, however, whether or not you make an offer or buy the home.

On most sales, you can request that HUD pays all or a portion of your financing and closing costs. Essentially you just make an offer as you would on any property, except that HUD homes are typically sold in an “Offer Period,” at the end of which all offers are opened and the highest reasonable bid is accepted. If not sold in the initial Offer Period, you can submit a bid any day of the week, including weekends and holidays, until the home is sold. If your bid is accepted, your real estate agent will usually be notified within 48 hours.

HUD doesn’t loan on these homes, although they do offer mortgage insurance programs that can help you get a loan. Contact a HUD approved lender for more information.

Investing In HUD Homes

HUD gives priority to owner-occupants purchasers. However, if there are no acceptable bids during the priority period, unsold properties are then available to all buyers, including investors. Your real estate agent should have the necessary details.

There are a couple ways to find out what HUD homes are available in your area. You can visit the HUD web site online and see the listings there. A better way is to find a participating real estate agent. He or she will know what is for sale, but also may know what HUD homes will soon be for sale. In any case, your real estate agent must submit your bid for you – HUD generally doesn’t accept offers directly from buyers.

When you make an offer, your real estate agent should help you with any paperwork. The settlement date (if your offer is accepted), will normally be within 30-60 days. You need to arrange financing and close the sale within this time, or forfeit your earnest money deposit (or you may be able to pay for an extension of your sales contract). The selling agent’s commission will be paid by HUD but only if you make this a condition of your offer.

Of course, when buying HUD homes, you have to analyze them like any other investment. If it will be a rental, you have to do the math to see if you’ll have positive cash flow. If you plan to fix it up and sell it, be sure there is a profit after all expected and some unexpected costs. Just because it is a HUD home doesn’t men it’s a great deal.

Copyright Steve Gillman. To see a photo of the house we bought for $17,500, get a free ebook on How To Buy Cheap Homes, and more, visit: http://www.HousesUnderFiftyThousand.com

Article Source: http://EzineArticles.com/?expert=Steven_Gillman
http://EzineArticles.com/?Buying-HUD-Homes-As-Investments&id=652285

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Check Out Energy Rebates

EnergyStar.gov — Check Out Energy Rebates

This is a government site that offers lots of energy saving tips as well as explains what energy saving grants or credits might be available.

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Foreclosure Trends Newsletter

Here is the latest issue of my foreclosure trends newsletter.  As you can see, the trend is not our friend, in the sense that the housing market has not recovered.  Until jobs come back and people are employed and feel safe in their employment, they will tend to avoid making a committment.

ForeclosureTrends.pdf

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HUD home buying tips

Provided by Patti Mazzara-Venture Development 952-285-4319 We can finance HUD homes.  While this information was going to be for Realtors to share with buyers, it is applicable for HUD buyers directly.

Bidding & Buying HUD homes—it seems to be the hot ticket in town.

However – Remember these key points to avoid problems and advise buyers:

Only primary residence buyers allowed in the first round of bidding.
·         Advise buyer that if home is being offered as eligible for FHA financing it:

o        Has an existing FHA appraisal that must be used (unless expired)                                                                      AND
o        The sales price has usually been based on the existing appraised                                               value.  Bidding above the sales price may result in them paying the                                                       difference out-of-pocket between their bid and appraised value.

·         HUD does not automatically provide title insurance.  Explain this to your buyer and make sure that the lender has disclosed this additional expense to them if they want to purchase it to avoid surprises at closing.  Only if HUD has agreed to pay closing costs, could the insurance be provided at HUD’s expense.
·         If HUD is offering a repair escrow, explain to buyers that this amount can be ADDED to their FHA loan, but HUD doesn’t pay for it.
·         Lender documents must be to the title company up to 10 days prior to closing date in some states.  Make sure the buyer’s lender understands and can accommodate the requirement.
·         HUD signs closing packages first.  Then once the loan proceeds and the title company receives buyer down payment and closing costs, the buyer is allowed to sign.  Make sure that the lender is aware and has the ability to fund the loan BEFORE they have a completed loan package.
·         Closing delays are common due to “title clearing” issues.  Foreclosed homes can have several liens due to utilities, taxes; etc that must be dealt with before closing can take place.  Prepare the buyer in the beginning and discuss potential challenges, such as rescheduling of moving trucks, and possible rate lock extension fees.

Buyers will appreciate your proactive approach to making their dream come true!

“The information provided has been based on rules and regulations issued by Federal Agencies and interpreted for you by MortgageCurrentcy.com.  Interpretations are not guaranteed but we attempt to make them both easy to understand and help you sell more real estate.  Check with your local and state authorities to ensure that you meet all requirements and disclosures.”

Copyright © 2009   Reprinted with permission   MortgageCurrentcy.com

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Twin Cities Foreclosure Trends-From our MLS & Realty Trac

Besides the board of realtor sites:  http://theThing.mplsrealtor.com and market data posted elsewhere at http://www.MplsRealtor.com I have a subscription to Realty Trac.  My subscription gives me additional data about foreclosures and trends within certain zip codes.  This is in addition to my daily subscription to Finance & Commerce (a business newspaper that prints all the foreclosure information as well as very timely articles regarding the business community).  If you are looking for someone who has experience and access to information about distressed sales, we need to be working together.  Whether buyer or seller-I can help you understand the market we are in and the options and opportunities available to you.  Give me call today.

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Real Estate Information

These are a couple of my newsletters that have a ton of valuable information. Go check them out.

Foreclosure Market Trends Newsletter
http://www.realtytrac.com/MarketTrends/NewsLetter.aspx?guid=131bd355-1b69-4bd1-99cd-2f0c9a936810

Real Estate Cyber Space Tips
http://www.REcyber.com/cybertips/r11627

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Outstanding Video-An Inspiration To All-Be The Best You Can Be!

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Twin Cities Home buyer book

Thinking about buying a home but don’t know where to start? Why not start by reading the home buyer hand book that we have provided below. It is a great place to start to get the information you need. When you’re ready, we would love to help you find and finance a new home.

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HAFA Is Here & NOW- Additional Assistance On Getting Short Sales Completed

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FHA ALLOWS Short Sale

Many people mistakenly think short sales can’t or won’t be done on FHA insured loans.  THIS IS NOT TRUE
Here is the link to the HUD pdf which outlines their current program guidelines:  http://www.hud.gov/offices/hsg/sfh/nsc/rep/pfsfact.pdf If you are in Minnesota and your home is within the 7 county metro area around the Twin Cities, we can help you list your home and do a short sale.

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Open Source Documents-Unbelievable Resources-Find YOUR topic of Interest

If you’ve never visited http://www.Archive.org, you are missing a wonderful site.  From this site, you will find many resources that are out of copyright and you can download and use them as you wish.  You will find all the classics and some fun things as well.  Just for fun, I have the download of a book called “Little Gardens” which is a book about setting up a garden on a city lot.  This is just one of the MANY fun things you’ll find.  You can download and watch old music, movies, and cartoons as well.  Plan to spend some time on the site should you decide to visit, as it is very cool.  Click here to download the book Little Gardens

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Sell Your Home Faster-Learn The Home Selling Secrets Of Successful Sellers

Here is a special report that outlines over 450 ideas on how to sell your home faster.  This report is just one of the many home buyer, home seller, and investor reports that I can make available to you.  Read this report and call me to arrange a time to see how I can help.  Download Now

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Beginners Guide to Flipping Houses

Flipping houses is becoming big business in the world of real estate investment. Unfortunately it takes all kinds of ‘flippers’ to make the world go around and some of them aren’t nearly as conscientious as others. If you are going to get into the business of flipping houses and want to make a living, and build a good reputation, for producing quality results you need to see to a few details throughout the process.

1. Do what needs to be done. Don’t cut corners and create situations that will put the family that purchases your home in personal or financial risk. You want to create a safe home for the family or person that ultimately makes the purchase. You do not accomplish this by taking shortcuts and using shoddy workmanship.

2. Avoid spending money that doesn’t need to be spent. By this I mean don’t spend money creating more work. Many people do this by deciding to tackle additions, rip out walls, or changing floor plans. These kinds of changes are best left to the buyer unless they will significantly improve the asking price you can bring in on the house. Otherwise spend the bulk of your money in kitchens and baths where they are best known for bringing in bigger profits.

3. If it ain’t broke don’t fix it. There is a lot of wisdom in this age-old saying. There is no reason to go in and fix something that doesn’t need to be fixed unless doing so will improve the value of the house to its buyers.

4. Always work within a budget. Most people set a budget when planning to flip houses but very few manage to work within that budget. This is the difference in making the profits you anticipated and putting the entire project at risk.

5. Create a home that the buyer will want to live in not the home that you will want to live in. You should never flip a house or design a flip according to your tastes; it is a recipe for disasters in more ways than one. First of all, it is unlikely that buyers will be able to afford it. Second, it sets you up for hurt feelings if a potential buyer rejects any small details. Third, it often raises the price you must seek for the property in order to cover the increased costs of decorating and designing according to your taste. Finally, it often leads to unnecessary expenses, which defeats the purpose of a quick flip type of project.

6. Time is money. Remember this in all things. The more time it takes to do the flip the more money it’s going to cost and the less money you are going to make. Plan small changes that have a big impact and can be done quickly to get the most out of your flip.

7. Never attempt a champagne flip unless you have a champagne budget to back it up. Just as flipping above the market is an unwise move it is equally unwise to flip a property beneath your target market as well. Do not attempt to flip a house in an upscale neighborhood if you can’t manage the upscale building supplies and appliances that will be needed in order to make it a success.

While these aren’t guarantees for success they are solid advice that will minimize the risks you face when flipping properties.

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ABCs of Flipping Houses

All new things can be a little frightening or intimidating at first glance. The same is definitely true when it comes to flipping houses. Many people feel several times during their first flip that they have gotten in over their heads. The truth is that it will take more than a few flips to feel comfortable with the process. Most people make very little, if any real profit on their first flip and write it off as a learning experience only to enter into the next flip with newly learned lessons and a positive attitude. Learning the ABCs of flipping houses is a great place to begin and can help you avoid costly mistakes made by many first time flippers.

1. Appraise. You need to have a proper appraisal performed on the house you intend to flip and compare it to other houses in better condition and of similar size and style within the neighborhood. You do not want to buy the best house in the neighborhood, in fact it is best if you can find the neighborhood eyesore and turn it into a competitive house for the neighborhood in order to get the most for your money. More importantly you want the appraisal to reveal the actual value of the home now as compared to the price you are paying and talk to the appraiser about what the home would be worth the with improvements you are planning to make.

2. Bold Moves. Sometimes it takes bold moves to make the impression you want to make. The decision to flip houses is a bold move in and of itself and while you do not want to necessarily enter into risky waters you do not want to play it too safe either. Be cautious with your financing and guard your expenses and your budget well but make the changes that will catch the eye of the next owner for the property.

3. Can do Attitude. You absolutely must believe you can do this in order to get it done. A house flip is not an undertaking for the timid or those that lack self-confidences. You will need to stand up to your contractors, inspectors, and even some vendors in order to get the best price and the most bang for your buck. In other words you need to believe in yourself and what you are doing in order to get it done. This doesn’t mean you shouldn’t listen to the advice of those with more experience and expertise, especially when it comes to structural issues within the home and bringing the property to code but you also need to stand up for yourself to insure that you aren’t paying for things you aren’t getting.

4. Determination. You must also be determined to see your project through to completion. It takes a certain sort of pigheadedness to get through the first few flips. It should be stated here that flipping houses is certainly not an easy way to make a living. It does have the potential however, to be a highly profitable way to make a living and that is what most potential flippers are looking for. If you want those profits you are going to need to push yourself out of bed even on those mornings when you feel as though looking at the property in question is going to make you wail and moan and pull out your hair.

5. Excitement. This may be the most necessary of all ingredients. You will find that excitement is in short supply many days but it if you can recapture that initial excitement over your decision to flip houses then it will sustain you on those days when the plumber brings bad news or you just learned that a solid weak of rain is forecasted for the weak the roof was to go on.

This is a small start on the ABCs of house flipping and real estate investing but I think you get the picture. Good luck!

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5 House Flipping Do’s

While many people have very specific dreams of enjoying the bountiful profits that can be made from flipping houses very few people put too terribly much thought into the process or any formulas that might be pertinent to success when it comes to flipping houses as a real estate investment venture or for the sake of building a nice comfortable lifestyle or retirement. You will hear a lot about the things not to do when it comes to flipping houses but very few people take the time to mention the things you absolutely must do in order to successfully flip a house and thus begin your ride on the road to real estate investment riches.

1. Do put everything to pen and paper and plan it out carefully before you begin. If you are going to enter into this to make money you need to treat it like a business. This means you need to have a plan of action and make every effort to work towards carrying out that plan.

2. Do establish a budget for the entire project. You need to have a plan for how much money you are willing to invest in the property itself, how much for renovations, and how much money you need to make in order to be a worthy investment for your time and labor.

A house flip is a lot of work in order to pull it off successfully. You want to have a good idea of how much homes in the neighborhood are worth, the value of your property as is and the estimated value of the property once improvements are made. In addition you should also have a pretty firm grasp of the costs involved in making the repairs in order to create a realistic budget for the entire project.

3. Do have an inspection. This is the single most important detail that can save you a great deal of time, money, and heartache when everything is said and done. Be prepared to walk away if the inspection determines that there is more work needing to be done than simple cosmetic repairs. You want to make changes that people can see because those are generally the changes that drive up the cost of the house. You want to avoid needing to make changes and improvements that aren’t visible but are very necessary. If you need to invest a lot of money and labor into the house you need to seriously consider the realistic profit potential the property offers. If it isn’t significant then you need to walk away before the property becomes a real estate investment money pit.

4. Do know the neighborhood and plan your flip according to the needs of the area rather than your personal tastes and needs in a home. This is another thing that many first time flippers forget. This is not a personal project it is a business project and you need to treat it as such. Keep costs down and feelings out.

5. Do remember that you are in the market to make money not waste money when it comes to establishing an asking price for the property. You’ve poured blood, sweat, and probably more than a few tears into your flip but you cannot set the value of the property by the effort you’ve placed into it. Have realistic expectations of how much you stand to earn from your efforts and how much you are willing to go down on the price in order to walk away with some profit in your pocket.

You should also take a moment to reflect upon the fact that many first time flippers actually lose money on their first flip. If you turn a profit at all, even a small profit you have learned many valuable lessons that you can carry with you into future flips and make more money. More importantly the lessons you learn from your first flip are lessons that money really cannot buy so it is worth a lower profit or even taking a slight hit if your experience makes you even more money in the future as you continue along your real estate investment path.

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5 House Flipping Don’ts

When it comes to making money in the business of flipping houses and other real estate investments you will find all kinds of do’s and don’ts along the way. The truth of the matter is that these are extremely useful whether this is your first house flip or you have been flipping houses for years. In fact you might just find that you can learn something new on occasion by reading lists such as this even if you’ve been flipping houses for years and have many successful flips under your belt.

1) Don’t forget to check out the neighborhood before you buy. You will want to make sure that the property you are considering is a good fit for the neighborhood. You should also take the time to make sure that the plan you have in mind for the property will match well with the other neighborhood residents in order to guarantee a quicker sale.

2) Don’t blow your budget without just cause. Your budget is what you used to determine whether or not the house would be a profitable venture. If you blow your budget and cannot recover the extra money you’ve spent in the selling price on the house you will have seriously cut into your profits if not eliminated them all together. The goal in property flipping is to get in and out quickly and spend as little money as possible in order to make as much money as possible.

3) Don’t forget to set daily goals and hold yourself accountable to those goals. If you don’t reach your goals for the day it can set the entire project back by as much as a month depending on the goals and what has to be rearranged as a result. Stick to your timeline and your daily schedule in order to avoid potentially costly delays in time and money.

4) Don’t neglect the exterior. Curb appeal is what brings buyers into the property. If you spend all your money, time, and effort making improvements to the exterior of the home you will have little left to make the outside appealing to potential buyers. A homebuyer is in the market for the entire package. A home that looks run down on the outside leaves the impression of being neglected on the inside and many potential buyers will never walk inside if the outside looks forlorn.

5) Don’t spend money you don’t need to spend. While it would be great to put in granite countertops and gourmet kitchens into every home it isn’t always practical and this is often money that will not be recovered, particularly in homes that are in marginal neighborhoods. If you want to get the most for your money avoid costly expenses that aren’t exactly necessary for the successful completion of the flip. Resurface bathroom fixtures rather than replacing them if possible and use new cabinet doors or hardware rather than adding new cabinets all together to cut down on expenses. In other words, salvage what you can, fix what needs to be fixed, and add a few cosmetic touches before moving on.

The market for real estate is a very fickle market. Avoid risking too much time and money on a property that isn’t going to recover those added touches and expenses. Instead hold onto those ideas for higher end flips once you have a few successful flips under your belt.

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Real Estate Investing-Everything You Need To Know!

I came across this e-book and I wanted to share it with you.  I thought the information was useful, the rolodex link in the back of the book with investor resources was incredible.  I think you will enjoy it-it is a pretty light read.  If you get all fired up and want to start looking for property, just give me a call.

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RECENT News Release: Legal Service Plans Can Benefit Homeowners Facing Foreclosure

Pre-paid legal recently had a news release that explains how their service may benefit homeowners who are in distress and facing a foreclosure. We sell the PPD Pre-Paid Legal service plan at our website https://www.prepaidlegal.com/Multisite/Multisite?site=hub&assoc=mazzara You probably want to look at the family plans unless you are a small business. You can visit the site, watch the video, and learn more. I not only sell the plan, I am also a user of the plan. I think PPD is great based on my own personal experience. I have called upon them to answer questions and they have been of assistance over the years. If you have questions that aren’t answered online, call me.

Read the news release here:
http://www.prnewswire.com/news-releases/legal-service-plans-can-benefit-homeowners-facing-foreclosure-70452157.html

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Extension And Expansion Of Home Buyer Credit-4/30/2010

A Big WOW!!  The credit has been expanded to include homeowners who have owned their home for the past 5 years. No longer do you need to be a first time buyer.  The dollar limit is $8000 for first time buyers and $6500 for move up buyers.  This GREAT news.  Combine this with 50 year lows in interest rates, and you’d be crazy not to consider making a move.  If you feel secure in your job, think hard about buying  home at this time.  We can help you make the right move. Visit this site-which is from the National Association Of Home Builders  http://www.federalhousingtaxcredit.com/faq2.php This site give you all the rules and regulations as they now apply.

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Why Foreclosure Is Often Preferred By The Loan Servicer Instead Of Offering A Loan Modification

Have you ever wondered why a foreclosure occurs when a better solution might have been a modification?  Would you like to read the facts and figures and see how mortgages are bundled, sold and serviced?  You will soon see it is isn’t pretty, we are in the midst of a crisis, and it is likely to get worse before it gets better.  That being said, you can probably guess why-it’s about the money.  It is a little more complex than that-the report is 60 pages-but is explains the incentive and disincentives that are at conflict within the mortgage market today.  Once you understand how all the pieces go together, you can see that something “different” needs to be done.  I am a strong free market believer, but in this case, the government needs to have a mandate and rule that is guided towards keeping people in their homes.  Left to current industry solutions, the mortgage mess will continue to play out and get worse.  If you click on the link below, you will find the free report from the National Consumer Law Center.

http://www.consumerlaw.org/issues/mortgage_servicing/content/Servicer-Report1009.pdf

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Home Buyer Tax Credit Information Update

It’s now official!! The tax credit has been extended and expanded. YOU NEED TO HURRY! You now have until the end of April 2010. The following summary of the credit is provided by the National Association Of Realtors. The following two documents cover the changes in the new law. Now get out there and buy a home!!

NAR FAQ: Homebuyer Tax Credit Changes
NAR Issue Brief: Homebuyer Tax Credit Changes

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Minnesota Real Estate Newsletter Gives Access To Great Computer & Life Tips

I maintain a number of real estate sites, blogs, and newsletters. One newsletter that provides a number of computer tips to help you function better with a computer is http://www.REcyber.com/cybertips/r11627 The site is full of cyber space tricks and great places to visit. We have link to this site on the list of MN Real Estate links, but I wanted to highlight this particular newsletter because it different from what most agents provide. From this newsletter, you can also access all the back issues-from 2001 and beyond. It is really quite a useful resource-spend some time there if you have a chance.

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Buy A Minnesota Investment Property With Confidence

RE/MAX has put together a “how to guide” on how to buy investment property.  Since knowledge is power, get the guide and brush up.  It’s your money-get the information you need to become a successful Minnesota investment property investor.

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New Homebuyer Tax Credit

Back in 2008, there was a $7500 tax credit that was enacted by Congress and it was to be a great incentive for those buying homes for the very first time. It was to help out the over supply of homes out there that are for sale. For the year of 2009, there have been some changes made to this tax credit. Wondering how the new Homebuyer Tax Credit actually works? Here’s a look at the changes that have been made, who will be eligible, and a lot more important information that you need.

How this Has Changed for 2009

Wondering how everything has changed for the year of 2009 when it comes to the Homebuyer Tax Credit? Well, while the credit used to be $7500, it has now been increased by Congress to $8000. For those that purchase in 2009, there is no repayment feature on this credit, like there was back in 2008. Homes that are purchased for more than $80,000 will get then entire $8000 tax credit. Those that are lower than that will get 10% of the cost of the home. So, someone purchasing a home for $70,000 would get a tax credit of $7000. The purchase must be between January 1, 2009 and must occur before December 1st of 2009.

The People Eligible for the Credit

Many people are wondering who is going to be eligible for this new Homebuyer Tax Credit. Well, only people who are purchasing a home for the very first time are going to be eligible. People qualify as a first time home buyer if they have not owned a home for the past three years. Of course the purchase of the home has to fall in the time frame as well, in order to get this credit.

How it All Works

So, how does this tax credit work? Well, the tax credit reduces the amount of income taxes that are paid. When you fill out your income tax return, you claim these credits on there. You figure out your income items, and then your exemptions, then you figure out the amount of your total tax. Once you figure this out, then the tax credits are going to be applied to what you owe. If you owe $10,000 to the government in taxes and you have the tax credit of $8000, then you’ll only end up owing the government $2000.

A Refundable Credit

There are times when you can get a refundable credit as well. This occurs if you are able to get this tax credit for your home, but you owe less than the $8000 on your taxes. In this case you can actually get money back in a refund from the government. If you only owe $3000 to the government and you have the tax credit of $8000, then you’ll end up getting a refund check from the government for $5000.

Income Restrictions

You will find that the new Homebuyer Tax Credit does come with some income restrictions that you need to know about. The restrictions are based on the amount of money that is claimed and the filing status on the income tax returns. Those who are single can only have an income of $75,000. However, married couples who are filing jointly can have up to $150,000 to quality for this tax credit.

Determination of Income

So, how is the income determined to figure out if you meet the restrictions or not? Usually this is figured out just like the Adjusted Gross Income on the 1040 tax return. This can include salaries, interest, pension, rental income, and many other things. It is this Adjusted Gross Income that you’ll want to look out to make sure that you meet the income restrictions on the tax credit.

The Principal Residence

The tax credit is only available for those who are purchasing a principal residence. So, what exactly is a principal residence? Basically this is the home where a person ends up spending 50% or more of their time. It also may be called housing that is “owner occupied” as well. This includes condos, single family housing that is detached, townhouses, and co-ops. In some cases manufactured homes and even a few houseboats may quality under this definition as well.

Financing Restrictions

For the most part you’ll find that various types of financing are going to be acceptable when you are trying to claim this credit. There were some restrictions in 2008, but the one that was applicable then was removed in Congress. So, you don’t have to worry about financing restrictions keeping you from being able to claim this tax credit.

Do These Credits Have to Be Repaid?

While last year the tax credit eventually had to be repaid, in 2009 there is no repayment on the tax credits that are being given. This is excellent for new homeowners, since they won’t have to worry about paying back the government in the future.

How to Get the Credit

So, how do you get the new Homeowner Tax Credit? Well, there is nothing really special you need to do. Simply claim this on your 1040 tax return this year. The credit will be on a 5405 form that you will attach and you can easily get this form at the IRS website so that you can make the claim and get that tax credit.

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Why Work with a Realtor?

Today there are many people who think about selling their home on their own. However, many of them end up going with a realtor for their needs. It’s definitely a great idea to decide to work with a realtor when you are selling your home or you are trying to purchase a new home. Many real estate agents are not actually realtors, and realtors have quite a bit more to offer consumers. Not sure that you should choose a realtor when you are selling or buying a home? Well, here is a look at some of the top reasons that you definitely should work with a good realtor.

They are Experts in the Real Estate Field

One great reason that you should definitely consider working with a realtor is because they are experts in the real estate field. Having an expert on your side is definitely a great idea. Many people out there today purchase or sell their homes with a realtor. Realtors come with a whole lot of experience and definitely will be able to use that experience to help you acquire a great home or to sell a home for a good price.

Realtors Know the Community

Another reason to go with a realtor when buying or selling is because realtors know the community. They are active in the community and they know the community that they are working in. This is important, whether you are purchasing or selling. You want someone on your side that really knows what is going on in the local real estate market.

They Can Offer You Protection

You’ll also find that a good realtor can offer you protection when you are selling your home or purchasing a home. They know the laws and the nuances of the real estate industry that are very important. Without a good realtor on your side, you could end up making a mistake that will cost you in the long run.

Realtors are Supposed to Be Honest

Realtors have a code of ethics, that states that they are supposed to be honest. This definitely benefits you. After all, you want someone on your side that is going to be honest with you, no matter what. Even if it is something that you really don’t want to hear, it’s great to have someone that will be very honest with you. This is something you can count on.

Required to Disclose Important Facts

According to the code of ethics, realtors are required to disclose any important facts to you as well. This means that any facts that you need to know, your realtor will let you know about. They’ll give you good advice along the way and give you the facts that you are going to need to make the right real estate decision.

They Have Your Interests at Heart

A good realtor will also have your interest at heart. This is one reason it is such a great idea to have a realtor on your side. They will help to make sure that you get the best deal and the best home for your needs. A realtor is committed to making sure that everything works out for you. This is definitely excellent for you.

Realtors Have Resources

Another reason to have a realtor help you with selling or purchasing a home is because they have many great resources available. If you are looking for a home, they have a variety of different resources they can turn to, in order to help you find the home that you want. You won’t have to spend time looking, but your realtor can do that job for you with the great resources that are at their disposal.

Help with Negotiation

Often in a real estate deal there is quite a bit of negotiation. This can include negotiation about the terms, financing, price, date of possession, repairs, equipment, and more. If you are not well versed in the art of negotiation, you may not get the best deal for you. With a good realtor to help you out, they can help you out with the negotiation so you get a deal that is totally fair to you.

Explanation of Financing

You’ll find that a good realtor can help you to understand the financing options that you have available to you. They can explain different options and lead you in the right direction. They also have access to many lenders and can help you to identify good lenders for the financing that you are going to need.

The Process is Smoother

Going through a real estate deal is not always a smooth ride. Some times things crop up along the way. Using a realtor can help you to make sure that this process is much smoother. They’ll help to ensure that everything works out very smoothly so that you get through the deal as soon as possible without any problems.

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HUD Special for Police Officer, Teacher, Firefighters-GNND

The Good Neighbor Next Door (GNND) program offered through HUD is a great way for the everyday service heroes in the United States to purchase a home that has gone into a HUD foreclosure.  HUD homes and their mortgages are insured through the FHA or Federal Housing Association and when the buyers who live in those homes can’t afford the payments go into foreclosure, these HUD homes are offered to the public.  Being on the list of the Good Neighbor Next Door gives you an advantage in bidding for and obtaining these hudhomes.

Because the professions mentioned above are considered to be good neighbors, HUD offers the GNND program to them as well as Emergency Medical Techs (EMT) and gives them the chance to own a home in the areas they work.  There are some guidelines for the GNND rewards program in order for you to obtain a HUD home, let’s take a look at them and see how you can qualify if you are a firefighter, teacher, police officer, or EMT.

• Live Where You Work – HUD homes offered to the professionals who fall under the GNND program are restricted to those who choose to buy hudhomes in the areas where they serve and work.  For instance, if you serve in a certain neighborhood in a big city, and fall under one of the GNND professions, you are eligible only to purchase a HUD home within that neighborhood’s limits, unless you are a law enforcement officer.  The live in/serve in rule does not apply to police officer.

• Time Limits and Employment – All GNND people who wish to buy a HUD repo home must agree to make the HUD home their only residence for three years following the purchase and must be employed in their profession full time.

• Top Points – The GNND rewards program offers these professionals a 50 percent discount off the listing price and the hudhome must be in a revitalization area.  All bidders are selected through a lottery program and offers must be submitted through a licensed real estate broker who is certified to sell HUD homes.  You must also be able to produce some earnest money at the time of your offer, which is returned to you if you do not receive the lottery bid win.

• Restrictions – If both you and your spouse fall into the GNND professional rewards program, only one of you may apply and you can only apply once for the GNND program.

• Descriptions of Each GNND – Each professional who qualified for the GNND program has certain descriptions.  Law Enforcement professionals or officers must be employed by a law enforcement agency of the federal, state, local or Indian tribal government and sworn to uphold their divisional or municipal laws. Law Enforcement Officers are not restricted to the work/live rule that other professionals must adhere to. Teachers must work in a state accredited public or private school teaching K-12 students and the serve students from the area where the hudhome is located.   Firefighters and EMTs must be employed by a fire department or emergency medical services responder unit of the federal, state, town or local government or an Indian tribal government and serve in the area where the home is located.

• Owner Occupied – As stated above, you must agree to the HUD home restriction of living in the hudhome in an owner-occupied manner for three years beyond the closing.  If interruption of those three years occurs and is deemed as a hardship by HUD, you may be permitted to sell the HUD home.  Long-term vacations must be in writing to HUD and you must agree to resume occupancy upon your return.

• Financing Incentives – You must finance all reasonable and customary closing costs and be able to make a down payment of at least one-hundred dollars and the GNND is not good for multiple properties, only one HUD repo home may be purchased.

• Post Purchase Obligations – As a GNND you must continue to own and live in the hudhome you purchase and certify both initially and annually thereafter that you are continuing to reside in the home.

• Preliminary Interest – If no offers are made by any GNND during the preliminary interest on a hudhome are made, HUD will release the property for general public bid on a competitive basis.

• Required Documents – If you utilize the GNND program, along with your sales contract, you must complete and provide to HUD the following documents:

o    Inspection Addendum
o    Owner-Occupant Certification Form
o    Radon Gas & Mold Notice and Release Agreement
o    GNND Certification Form 9549-A if you are a law enforcement officer
o    GNND Certification Form 9549-B is you are a teacher
o    GNND Certification Form 9549-C if you are a firefighter or EMT
o    GNND Certification Form 9549-E – Employer verification form
o    Land Use Restriction Addendum
o    Flood Zone Addendum
o    Methamphetamine Disclosure Form from Seller in Minnesota and South Dakota only
o    Mortgage Pre-Qualification Letter – this must be from a lending institution staring that an in-house credit check has been performed and you are pre-qualified to obtain a mortgage.
o    Certification from the Financial Institution – this must state whether the purchase is cash or that funds will be available on the day of closing.

All professionals who fall under the GNND rewards program must follow these guidelines and submit the appropriate forms.  Any real estate broker who is licensed to sell HUD homes will be able to help you understand and obtain all of these forms in order for you to complete your purchase.  The Good Neighbor Next Door program is a great way for people who serve in certain professions to acquire a HUD home with discounts and guarantees.

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How Do I Buy a HUD Home?

Buying a HUD home is easier than you think.  HUD homes for sale are abundant and are available because of an FHA insured mortgage where the owner’s can’t pay and it goes through the foreclosed home process.  The myth that you can buy a HUD home for a dollar is just that a myth.  Hudhomes are sold at the current market value by comparing similar home sale prices in the area where the HUD home is located.  So how do you buy a HUD home?

• Meet the Agent – To find current listings for HUD homes in your area, you need to find a real estate broker who is licensed by HUD to sell their homes.  You can ask any local realtor if they are qualified to sell a HUD home.

• Check Listings – The realtor can walk you through the listings in your area and make appointments for you to visit the homes for an onsite inspection.

• Inspection – After you select a HUD home you are interested in, you should request an inspection.  All hudhomes come on an “as-is” basis meaning an inspection is a good idea and must be paid by you.  Weight the cost of repairs once you get the inspection and consider those in your offer.

• Make an Offer – Once you’ve gone through the inspection process and feel that if any repairs are needed, you can afford them or roll the price of them into a mortgage, you can then make an offer through your agent.  If the offer is accepted, you will start the loan process.  If the offer is rejected, you may have to negotiate to get the price both you and the homeowner agree to.  Make sure you and your real estate agent adhere to an offer’s timeline.  For example if you make an offer that is good for five days and then it is counter offered for five more days, you only have five days to accept or decline the counter-offer so be aware of timelines.

• Find a Loan – You can go the FHA route for a mortgage, pay cash for the HUD home, or shop around for a mortgage that best fits you budget.  You do not have to obtain a mortgage through HUD or FHA to buy the home.

• Home Insurance – You should also seek out a good insurance company for your homeowner’s insurance.  This insurance policy can be paid separately or rolled into your mortgage contract.  The same with property taxes.

• The Closing – Your realtor will draw up the closing papers and be careful to read everything that these papers contain.  Something you should ask for is if HUD will pay your real estate agent’s commission fees.  They often will, but if you don’t suggest it, they won’t either.

• Are There Special Programs? – Yes, firefighters, police officers, victims of Hurricane Katrina, school teachers, and other professionals have an advantage over other occupations or life situations in making a bid on a HUD home.  If a firefighter bids on the same home you want, chances are he or she will get it before you do.

• What If I’m an Investor – Investors can also buy hudhomes, however, first choice is to families who want to use the home as an owner occupied home.  If there is no bid on a home for an owner occupied family, as an investor, HUD homes are great, especially when you think of resale value.

• What Else Should I Know? – Ask your real estate agent to tell you about Borrower’s Rights, the Fair Housing and Equal Opportunity Brochure, and what the Real Estate Settlement process is.  All of these will aid you in making the right decision on your HUD home purchase.

Buying a repo home from HUD can be easy if you find a good real estate agent, ask the right questions, and take the time to consider counteroffers, and get a home inspection.  If you fail to follow these recommended guidelines, just as in buying any home, you may find yourself without all the necessary tools to close the deal and find a mortgage.

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What is a HUD Home?

Hudhomes consist of one to four unit residential pieces of property that HUD owns due to a foreclosure on an FHA insured mortgage.  Because HUD owns these properties, they want to recoup their losses on the foreclosure of the mortgage.  HUD homes can be purchased by anyone who is interested in the property and these government homes can be purchased through brokers who are registered with HUD to sell these foreclosed homes.

Due to the economy, repo homes are on the rise and while these HUD homes do give the opportunity for the owner to try to buy the home in full, when this fails, the HUD home goes on the market for sale to the general public and investors.  Purchasing a HUD home is a great investment for people that can turn around and sell the home and make money on that investment.

To explain further, when a property is a foreclosed home by HUD, because they insured the loan or mortgage on that home, they own it and can now re-sell it.  Foreclosed homes sold by HUD are sold at market value price based on what the going rate is for similar homes in the area.  This is definitely a buyer’s market with so many repo homes out there and many of them are HUD homes.

If you find a hudhome that you are interested in, ask your local real estate broker if they are registered with HUD to sell their foreclosure homes and have them make an offer on your behalf.  Often, HUD will even pay the real estate broker’s commission if it’s written into the contract, so make sure you ask for that.

An incentive program offered by HUD is for properties in certain areas that are available at a reduced sales price and are earmarked for law enforcement, teachers, firefighters, emergency medical technicians, nonprofits, and local governments.  If you are one of these people or organizations, a HUD home may be right for you.

Many people think that they must have cash to buy a foreclosed home.  This is not the case.  If you have cash or can qualify for a mortgage, you are qualified to buy a hudhome.  Because HUD homes are sold on an “as-is” basis, they don’t come with a warranty and HUD does not pay to correct problem.

That doesn’t mean you still can’t have an inspection on a HUD home before you commit to buy.  You can still request an inspection at your own cost to see if the HUD home you are interested in has major or minor repairs and how much you may need to make improvements to the home.   Often hudhomes are older and may have building or paint materials that need to be upgraded.

HUD homes can be a great value for a new family, a family that is looking to upgrade to a larger home, or for investment purposes.  Ask your real estate broker to check out hudhomes available in your area and make a trip to see some of these repo homes.

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