Indy Home Help Blog

Updated: October 1, 2010, 10:59 AM

FlashReplace.replace(“sky-ad”, “http://tbn-ads.s3.amazonaws.com/city-mattress/DollarSale160x601.swf”, “sky-ad-id”, 160, 600, 7, {“flashvars” : “clickTag=http://us.ard.yahoo.com/SIG=16117le41/M=600971608.601220802.447649551.447649551/D=ncbz/S=2022775705:AP35/Y=PARTNER_US/L=f22fde32-cd73-11df-a26f-43fe7681b9ae/B=7DVALNFJo9Q-/J=1285948371288254/K=TgUki2mDu16NsIYDW1ZMDQ/EXP=1285955571/A=1922640182015177367/R=1/X=2SIG=000000000/*http://www.citymattress.com/promotions.asp”});New state regulations going into effect today will impose standards on the conduct and practices of mortgage loan servicers handling New York mortgages, while setting up additional protections for consumers.The rules, issued in early August but effective Oct. 1, impose a new duty on loan servicers to pursue “loss mitigation,” such as modifying the loan terms or conducting a “short sale,” to avoid foreclosures that could be prevented.

Under the rules, servicers must now have enough staff, written procedures for handling consumer questions and complaints promptly, and procedures for making sure that consumers don’t have to submit multiple copies of documents. Servicers must also avoid foreclosures if a homeowner is being considered for or is already in a trial or permanent modification.

The rules are similar to the voluntary guidelines for servicers under the Obama administration’s Home Affordable Modification Program but can now be enforced by regulators.

The regulations also prohibit unfair or deceptive business practices, and set standards for day-to-day dealings with borrowers. Servicers will have a “duty of fair dealing” that says they must act in good faith with borrowers and provide them with clear and accurate communications. That includes “plain language” annual account statements and clear disclosure of payments made on taxes and insurance premiums.

Servicers also must have standards for promptly crediting payments from borrowers and for handling late payments. Late fees are restricted. And servicers are barred from placing insurance on a property without the borrower knowing.

The regulations implement parts of the state’s 2008 Mortgage Lending Reform Law, which was designed to address the foreclosure crisis and protect consumers in subprime and “high-cost” mortgages.

“New York State is continuing to take important steps toward ensuring that we will not see another mortgage and foreclosure crisis spurred on by irresponsible lenders or by unscrupulous individuals taking advantage of cracks in the system,” Banking Superintendent Richard H. Neiman said.

Earlier regulations, adopted in July 2009, set up procedures to register mortgage loan servicers in the state, and the companies were required under the 2009 Mortgage Foreclosure Law to send preforeclosure notices to borrowers at risk of foreclosure at least 90 days before proceedings begin. They must also file confirmation of those notices with the state.

State regulators share some of the data with housing counseling agencies to help direct foreclosure prevention services to those in need. Regulators also use the data to track defaults statewide.

Monetize Options for Distressed Borrowers

Tags: bank short sale, borrowers, consumer spending, distressed, distressed borrowers, foreclosure, foreclosure short sale, foreclosures, free foreclosure, home values, housing market, monetize, mortgage, principal balance, real estate, short sale home

Fannie Mae wants distressed sellers to avoid foreclosure and jump back into home ownership.   To incentivize homeowners to short sale or deed in lieu they have reduced the waiting period for homeownership again.

Struggling borrowers are now eligible to apply for a Fannie Mae backed loan in two years instead of the traditional four (down from five in 2008).     The new policy becomes active in July.     After the two year waiting period, to qualify, the borrower will have to put down a 20% minimum down payment.   If they have an extenuating circumstance like job loss, they may be able to put down as little as 10%.

Does this mean that the government is giving borrowers an œout?   No, borrowers are instead being encouraged to re-enter the housing market especially if they lost their home at truly no fault of their own.

Freddie Mac is still holding out at a minimum four year waiting period for borrowers to purchase after short sale or deed in lieu of foreclosure.   Both Fannie and Freddie make a seller wait a minimum of five years after a foreclosure.

Borrowers who qualify for and sign-up for the HAFA short sale program will, by agreement, have an end result of a short sale or deed in lieu of foreclosure.

Providing sellers with a referral to a mortgage broker who can better explain the Fannie Mae option for re-purchase would give them incentive to move forward.   Provided the rest of their financial picture meets lending requirements, these sellers may be the perfect candidate for a lease purchase.

As either a real estate agent or investors, you can monetize both ends of the relationship!

Monetize Options for Distressed Borrowers

Tags: bank short sale, borrowers, consumer spending, distressed, distressed borrowers, foreclosure, foreclosure short sale, foreclosures, free foreclosure, home values, housing market, monetize, mortgage, principal balance, real estate, short sale home

Fannie Mae wants distressed sellers to avoid foreclosure and jump back into home ownership.   To incentivize homeowners to short sale or deed in lieu they have reduced the waiting period for homeownership again.

Struggling borrowers are now eligible to apply for a Fannie Mae backed loan in two years instead of the traditional four (down from five in 2008).     The new policy becomes active in July.     After the two year waiting period, to qualify, the borrower will have to put down a 20% minimum down payment.   If they have an extenuating circumstance like job loss, they may be able to put down as little as 10%.

Does this mean that the government is giving borrowers an œout?   No, borrowers are instead being encouraged to re-enter the housing market especially if they lost their home at truly no fault of their own.

Freddie Mac is still holding out at a minimum four year waiting period for borrowers to purchase after short sale or deed in lieu of foreclosure.   Both Fannie and Freddie make a seller wait a minimum of five years after a foreclosure.

Borrowers who qualify for and sign-up for the HAFA short sale program will, by agreement, have an end result of a short sale or deed in lieu of foreclosure.

Providing sellers with a referral to a mortgage broker who can better explain the Fannie Mae option for re-purchase would give them incentive to move forward.   Provided the rest of their financial picture meets lending requirements, these sellers may be the perfect candidate for a lease purchase.

As either a real estate agent or investors, you can monetize both ends of the relationship!

Many buyers don™t concern themselves with the œprovisos of title insurance, and believe that if they are getting a title insurance policy before closing, they are protected. They will be protected, but from what? Just as property insurance might exclude water damage to a stamp collection in the basement, for example, or exclude the value of fallen 100 year trees that don™t fall on a roof, title insurance also has exclusions. To ensure that buyers get œgood, marketable title to property, as well as enough time to make that determination, buyers should insist upon (in the purchase agreement) a œtitle commitment being delivered within a short time after signing the contract.

The œtitle commitment is a contract by the insurance company to enter into an insurance contract with the buyer, whereby the title insurance company will guarantee good title, subject to exceptions it finds upon a title search of the property (e.g., easements and liens having been filed against the property).

Buyers should always insist, as a condition to closing, that all liens discovered by the commitment be removed at closing. Buyers will typically have a hard time insisting on utility easements or other similar restrictions of record being removed. However, if buyers have an early chance to review these items (via a title commitment), they can evaluate whether or not same will adversely affect the property they are purchasing, and exercise a right to terminate the contract if there are items that will adversely affect the buyer™s use or value of the property, that the seller won™t cure before closing (assuming such a right to terminate is in the contract).

Buyers should also insist, as a condition to closing, that the œstandard exceptions be removed at closing. The following six items are automatically excluded from coverage (the œstandard exceptions), unless the buyer requires otherwise:

-The œgap exception excludes from coverage matters that show up after the filing of the Commitment, and prior to closing;

-The œclaims not shown by public records exception excludes coverage for claims or interests that are not recorded (an unrecorded easement, for example), that are discoverable by inspecting the land or inquiring of those in possession;

-The œsurvey exception excludes from coverage facts that a current survey would disclose, unless such facts were otherwise discoverable in the public records;

-The œmechanic™s liens exception excludes from coverage, protection against claims of materialmen or laborers for work done/materials furnished that have not yet been filed;

-The œrights of others in possession exception excludes from coverage claims of persons other than sellers who exercise possessory rights against property (e.g., tenants or œsquatters); and

-The œtaxes and assessments exception excludes from coverage taxes and special assessments that are a lien, but not yet due.

It is very customary (especially in commercial transactions) for buyers to be entitled to have the standard exceptions removed¦ on one condition. They have to ask. Seldom is it volunteered in a seller-oriented form contract, or offered (without asking) by a title agent. The survey exception is easily removed by a new ALTA survey, or update of a relatively recent ALTA survey. The other standard exceptions are typically removed upon the seller signing form affidavits prepared by the applicable title company.

The moral of the story for buyers of real estate (residential and commercial)?
Have a real estate lawyer draft or review your contract, BEFORE you sign it, to ensure that you have: (1) the right to receive a title commitment and survey, (2) the right to have the standard exceptions removed, (3) the right to review and object to adverse title/survey matters, and (4) the right to terminate the contract if the seller won™t cure survey or title matters that adversely affect the use or value of the property you are buying.

We on The Mergell Team currently are managing over 60 listings.   The majority of these homes are short sale situations.   We specialize in the short sale process and are cosidered the “Heavy Hitters” at RE/MAX when it comes to short sales.   We would love to help you overcome your foreclosure too.   Our success rate is uncontested.   We have established long standing relationships with most banks.   This way we are able to accomplish your short sale more efficiently.   This is just our first general entry.   Blog on!

Mergell Team @ RE/MAX Legends Group

Welcome to Edward Neu’s Blog! This blog will provide you with valuable information, tips, and general insight into the real estate market in Indianapolis. Visit my website at http://EdNe543.featuredwebsite.com.