They “Duped” em. Down Payment Assistant Programs feeling slighted

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I came across this video on a Loundon County Real Estate agents site. I told you before about the Nehemiah and AmeriDream. It has been in front of Congress for sometime now on the HR 6694 - FHA Seller-Financed Downpayment Reform and Risk-Based Pricing Authorization Act of 2008. The DAP will go away if this program passes. You can contact your congress reps by going through AmeriDreams new website called SupportHomeOwnership.org. This is one program that does not cost taxpayers any money. This is funded completely through the agreement of the buyers and sellers.

Thanks Heather for the Vid.

Have a great day.

August 21, 2008 · Filed Under Buyer, Frederick MD Real Estate, seller, video

2 Comments

Down Payment Assistance - How do I get it?

I just listed a home in a troubled area for pricing…imagine that! All the condos around this one is heading to foreclosure and subject to third party approval, in other words, a short sale. The pre-foreclosure market is skyrocketing higher everyday. There are 163 homes listed in RealtyTrac as Pre-Foreclosure today, while there were only 48 two months ago.

So I had to come up with a strategy to help this seller maximize her sales price and make it more marketable than the lower priced counter parts. This seller knows her stuff and had already remodeled the whole unit. She completely remodeled the Bathrooms…no one else’s cooties. Updated the kitchen with ceramic tile. New carpeting throughout the rest of the condo. And of course no remodel is not complete without a fresh coat of neutral paint. This type of upgrade is almost a given in this market if you want to be competitive. And by the way, the other condos are list “as is”…which means you, the buyer does AAALLLL the repairs. Not such a good deal after all.

But we still needed one more up on our competition…more so than Closing Cost assistance. Banks look at todays market as a “Declining” or “Soft” market, which makes it harder for the average joe to secure a loan. Most banks are requiring at leasta a 5% down payment in order to swing the loan.

In comes the Down Payment assistance programs. Since most lenders have a cap on how much assistance a seller can give the buyer, buyers either have to have the extra money in their banks accounts (chances are very slim for first time home buyers.) or they need a gift from someone. This gift is usually from a relative like Mom and Dad or everyone’s favorite rich uncle. There are a few non-profit organizations that realize the not everyone has that rich uncle, but the sellers are willing to help in order to sell the house.

Two programs that I heard success are successful and easy to use are the AmeriDream and the Nehimiah Down Payment Assistance Programs. Key things about these programs the seller has to agree to it, because they make the donation to these organizations. In turn, they give the donation back to the buyer as a gift minus a nominal fee…(a new rich uncle)

At AmeriDream, our goal is helping first-time, and low and moderate income individuals and families become homeowners. AmeriDream’s Downpayment Gift Program gives buyers up to 10% of the sales price of a home for a down payment or closing costs, removing the largest barrier for many prospective homeowners.

For this home I recommended the Nehimiah Program, ordered up some signs from them along with some program flyer’s and advertised “Down Payment Assistance Available”

Gift funds up to 6% of the final contract sales towards your downpayment and/or closing costs

Gift funds for both first time and repeat homebuyers

(Nehemiah charges a nominal processing fee that may be paid by the seller, homebuyer, or lender.)

Gift funds for both new construction and resale homes

No repayment of gift money

No income or asset limits

No geographical restrictions

The listing is brand spanking new (literally and figuratively) so I will let you know how it goes. This is one solution I offer to help sellers attract buyers. Each home is unique…so the marketing needs to be just as unique.

Contact me today, if you are ready to put your house on the market.

Here’s a peek at this diamond in the rough.

Have a great day.

April 2, 2008 · Filed Under Buyer, Frederick MD Real Estate, Friday

9 Comments

Putting a Short Sale together - what’s with all the paperwork

photo credit: neoterra

As I have mentioned in previous post about Short Sales, there are a few items that the seller will need to accumulate in order to submit a Short Sale Package to the bank. The topic about short sales have been on the tip of everyones tongues recently. In fact, most of the information has already been written, shown at seminars, posted on youtube and MySpace, but not everyone understands the process. And that is what I am trying to do for you…help you understand. Buyers and sellers feel like they are out there all alone. A knowledgeable agent can help both parties navigate through this turbulent transactions. Understanding what to expect and what is required help considerably in the short sale process.

Disclaimer; I am not a tax expert, CPA, financial planning expert, nor a lawyer. I suggest before you decide if a short sale is right for you, that you seek professional advice from your CPA, tax expert and lawyer. What I am giving you here is a peek into what could happen if this is the right choice for you.

One of the pioneers in the short sale markets is a fellow Real Estate Agent in Bonita Springs, FL, Chris Griffith. She writes often on her blog, Real Life in Bonita Springs and now writes weekly for the Naples Daily News. You can read her entire post about short sales here, but I will provide you with a few excellent excerpts from her article.

“Some buyers may not want to wait weeks or months to navigate a short sale, so to expedite a fast, successful sale, get your paperwork in order. Although your lender may have slightly different guidelines, the following items are commonly required: “

Listing contract

Sales contract

Hardship letter

2 years W-2’s or tax returns

2 months pay stubs

2 months bank statements

Recent statements for 401k, retirement, investment accounts

Financial statement listing current liabilities, assets and income information

A letter of permission authorizing your real estate professional, your attorney and/or C.P.A. to speak to & negotiate with your lender on your behalf.

As she points out, each bank has it’s own criteria and set of rules, but for the most part require the same amount of patience and paperwork. And I will close with one of her statements that everyone has to remember…

Regardless of your situation, it is still the bank’s decision as to whether to accept the short sale terms. Some find that no matter what they do, foreclosure is inevitable. But that is why it is imparative to have an experienced real estate agent working on your behalf.

March 12, 2008 · Filed Under Buyer, Frederick Foreclosure, Frederick Market Conditions, seller

3 Comments

Ignore the Headlines - finally the media gets it

I came across an article recently that I would like to share with you. For so long the media has been pounding that the market is bad, horrible, stay away… Yes, things haven’t been as productive as they used to (for sellers). I have written many times about this market too. The media likes to to generalize the numbers for the most part. They quote the national averages and then point toward ground zero of the worse areas in the United States.

Let’s talk quickly about averages… You total the data and divide it by the number of data points and you have one number that represents the average. Example: 1, 7, 10, 2, 3, 9, and 10. The average is 6. So if each number represents a housing market, you have seven areas. Each area has a number to represent the condition (10 being the worse) The news media tends to focus on the areas with the numbers above the average (or the most affected areas.) You still have markets that are out performing the rest of the nation. So, when someone shows you averages, remember there’s always high numbers and low numbers. Which do you want to focus on?

Back to the article “Ignore the Headlines”...It talks about the economy, stock market, oil prices and the housing market. The part that really drew me in and something I can’t stress enough. Was the example that Jim Svinth, chief economist of Lending Tree, made about “waiting it out”

Consider a typical home that sells for $218,900. You put down 20% and get a 30-year fixed-rate mortgage at today’s rate of 5.5%. Monthly principal and interest come to $994.31. Let’s say that 12 months from now the same house goes for 10% less, or $197,010. But by then the recession is history and the Fed is jacking up rates to stem inflation. If mortgage costs rise a point, to 6.5%, your monthly payment would be $994.94 and you’d have saved nothing. Meanwhile, home prices might steady and sellers might become less willing to negotiate. And you have spent a year living someplace you’d rather not be.

This market is a moving target. Everything is pointing in the right direction for eager buyers. High inventory to choose from and low interest rates. The creative loans have gone to the wayside. If you qualify for a loan, you should feel secure in making the payments. Lenders have tightened their requirements (they had to.) Sellers are up against foreclosures and short sales that are impacting the values of their properties. Hold your ground…selling your home might not be the best thing to do right now.

We will climb out of this market…we always have. Real estate is a cyclic market…

February 20, 2008 · Filed Under Buyer, Frederick MD Real Estate, Frederick Market Conditions, seller

5 Comments