Brenda Selner

Short Sales Insights

Brenda Selner — Thu, 15 Mar 2012 00:29:00 GMT

1. How long does it take for a bank to approve a short sale?

It is getting better as some banks are making strides in streamling the procedures. While it takes an average of three to six months, the timeline – and the process – vary quite a bit from one bank to another.

Short sale approval timelines depend on the bank (some just take longer than others). While each bank has different short sale guidelines, the short sale has to make sense to the bank. The more sense the short sale offer makes to the bank, the faster the approval process.

Here are some things that slow down the process by several weeks or more – these usually involve more people or more factors:

Multiple liens on the property
A third party negotiating the short sale on behalf of a seller. Some states allow third parties to do this, for a fee; some states, like Virginia, limit this to real estate licensees, attorneys, and employees of attorneys.
Private Mortgage Insurance (PMI) on the property
Additional investors

2. Will the bank make repairs to the property?

The short answer is, probably not. The long answer is probably Not.

Here’s why:

The bank does not have possession of the property and has no authority to make repairs on behalf of the seller.
Many short-sale sellers do not have the financial means to make repairs nor the inclination to improve a property they are losing.
Most banks require the short sale to be sold strictly “as-is” and do not encourage the seller to make any repairs.

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3. How do other types of debt affect the short sale outcome?

Many short-sale sellers are more than just “house-poor.” Many have additional debts that place a cloud on title. These include tax liens – income and property, medical liens, mechanic’s liens, and child support judgments.

Depending on your state, some creditors can try to collect debt by going to civil court and getting a judgment lien placed on the property against the homeowner. These liens must be cleared before the short sale transaction can be closed.

Surprisingly, tax liens are probably the easiest to clear off the title. The IRS has several avenues to collect back taxes, and doesn’t want to become a real estate holding company. Removing a tax lien can take up to 120 days, so it is imperative that this process is started well in advance of the short sale..
In short, additional debts can tie up the short sale process.

Often the benefits of a short sale are realized in a deeply discounted property otherwise unaffordable. Surprisingly, many transactions are uneventful and smooth through to closing but be aware, they are the exception. Surrounding yourself whether Buyer or Seller with knowledgeable professionals is the first order of business. Of utmost importance is your patience to endure the anticipated delays as the process works it's way toward a successful closing

Mortgage Rates Lowest in Over 50 Years

Brenda Selner — Thu, 25 Aug 2011 13:59:00 GMT

Mortgage Rates Lowest in Over 50 Years

MCLEAN, Va., Aug. 18, 2011 /PRNewswire/ -- Freddie Mac (OTC: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS^®), showing mortgage rates, fixed and adjustable, reaching all-time record lows providing further incentive for those homeowners looking to refinance. The 30-year fixed averaged 4.15 percent, breaking the previous record low of 4.17 percent set November 11, 2010.

News Facts

30-year fixed-rate mortgage (FRM) averaged 4.15 percent with an average 0.7 point for the week ending August 18, 2011, down from last week when it averaged 4.32 percent. Last year at this time, the 30-year FRM averaged 4.42 percent.

15-year FRM this week averaged 3.36 percent with an average 0.6 point, down from last week when it averaged 3.50 percent. A year ago at this time, the 15-year FRM averaged 3.90 percent.

5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.08 percent this week, with an average 0.5 point, down from last week when it averaged 3.13 percent. A year ago, the 5-year ARM averaged 3.56 percent.

1-year Treasury-indexed ARM averaged 2.86 percent this week with an average 0.6 point, down from last week when it averaged 2.89 percent. At this time last year, the 1-year ARM averaged 3.53 percent.

Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage. Visit the following links for Regional and National Mortgage Rate Details and Definitions.

Quotes

Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac.

"The Federal Reserve's policy statement last week and ongoing market concerns over the European debt market carried momentum into this week allowing all mortgage products in our survey to reach all-time record lows. For instance, 30-year fixed mortgage rates are now the lowest in over 50 years. In comparison, the Bureau of Economic Analysis estimated the average effective mortgage rate was about 5.3 percent on single-family loans outstanding during the second quarter of 2011.

"Not surprising, many homeowners took advantage of this low mortgage rate environment and have already refinanced their loans. The refinance share of applications averaged nearly 70 percent of all mortgage activity in the first half of this year, according to our survey. In addition, an increasing share of refinancing borrowers chose to shorten their loan terms during the second quarter, according to Freddie Mac's Quarterly Product Transition Report."

Get the latest information from Freddie Mac's Office of the Chief Economist on Twitter: @FreddieMac

Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters.

SOURCE Freddie Mac

For further information: Chad Wandler, +1-703-903-2446, Chad_Wandler@FreddieMac.com

The financial and other information contained in the documents that may be accessed on this page speaks only as of the date of those documents. The information could be out of date and no longer accurate. Freddie Mac does not undertake an obligation, and disclaims any duty, to update any of the information in those documents. Freddie Mac's future performance, including financial performance, is subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect the company's future results are discussed more fully in our reports filed with the SEC.

The VA way to finance a home

Brenda Selner — Mon, 22 Aug 2011 01:43:00 GMT

The VA way to finance a home

Veterans agency helps get families into homes with little cash upfront, and prevent foreclosure August 19, 2011 02:15PM By Kenneth R. Harney

Picture a mortgage program that seems to defy many of the lessons of the housing bust:

-- 91 percent of its borrowers make zero down payments.
-- Loan amounts go well into the jumbo range -- to $1 million and sometimes above, even with little or nothing down.
-- Credit standards are flexible and generous. Underwriting rules encourage loan officers to look for ways to approve applications rather than to reject them.
-- Mortgage originations are up -- almost triple what they were just three years ago and are on track this year to exceed 2010's volume. The rest of the loan industry, by contrast, is down by anywhere from 25 percent to 30 percent.

You might assume that any home loan program with come-ons like these must be swimming in bad mortgages, loaded down with serious delinquencies and foreclosures. Yet this one, which gets relatively little attention in the media, has better mortgage performance than the Federal Housing Administration and is comparable with some "prime" loan operations that have far more stringent credit rules.

Can you name this financing phenom? It's the Department of Veterans Affairs' home loan guaranty program. At a time when federal regulators are considering imposing a 20 percent minimum down payment requirement for most conventional mortgages, the VA program, which is restricted to veterans, offers important insights on how to get families into homes with little cash upfront, and to keep them out of foreclosure, even in tough economic times.

What's in the special recipe at the VA? Tops on the list: a combination of loan features that are by far the most attractive available in the current market. While the FHA program also offers minimal down payments -- 3.5 percent -- the VA goes to zero even if you need a jumbo-sized loan.

Unlike low-down-payment loans you can get from Fannie Mae and Freddie Mac and FHA, there are no monthly mortgage insurance premiums. VA loans do have an upfront "funding fee" that varies according to the down payment and other criteria. Currently this fee ranges from 2.15 percent for zero-down borrowers to 1.25 percent for applicants putting down 10 percent. Most applicants opt to roll the fee into the loan amount and finance it over time.

The VA imposes no credit score minimums. Its average FICO score is 708, compared with the 750 to 770 scores typical for Fannie Mae- and Freddie Mac-backed conventional mortgages at the best interest rates. It does, however, require underwriters to look closely at credit bureau reports and documented income to ensure that borrowers have the ability to repay their loans.

The agency is exceptionally flexible on seller contributions to help buyers pay closing costs, escrows and loan origination charges -- more lenient, in fact, than any other national program. That, in turn, can significantly lower the net cash outlays needed from borrowers at closing.

The VA also stretches debt-ratio norms when needed to help creditworthy, income-strapped borrowers get into a home. Though the official "back end" ratio of total household monthly debt to household income is 41 percent, lenders say VA will let them push this higher, even to 55 percent, on a case-by-case basis.

With all these accommodations to borrowers, how is it that VA's 90-day delinquency rate in the latest study by the Mortgage Bankers Association is 2.2 percent while FHA's is 4.8 percent? Or its total seriously delinquent plus in-foreclosure rate for borrowers is 4.5 percent against FHA's 8.04 percent and the conventional prime market (Fannie and Freddie) at 4.3 percent?

Michael Fratantoni, the Mortgage Bankers Association's vice president for research, said that the VA's record "is remarkably good, given that they're allowing first-time buyers to get in with no down payments," which is traditionally linked to high defaults and foreclosures.

Michael Frueh, the VA program's acting director, said the key to the agency's quiet success is its nearly paternalistic emphasis on servicing its 1.5 million borrowers -- moving early and quickly to intervene at the slightest hint of payment problems.

"At the end of the day we are veterans' advocates," he said in an interview. "We exist solely to help them," not only to afford to finance their homes but to remain in them. In the past three years, the VA has instituted industry-leading techniques such as requiring lenders to establish "single point of contact" servicing systems, where customers deal with one person about their mortgage issues, rather than anonymous multitudes.

Could this mindset -- intensive "advocacy" servicing as a borrower benefit built into the loan itself -- be duplicated in other segments of the mortgage market?

Ken Harney is a syndicated real estate columnist.

Florida Atlantic University’s medical college aims to make an economic impact

Brenda Selner — Fri, 19 Aug 2011 22:29:00 GMT

After admitting its first class of 64 future doctors, the new Florida Atlantic University Charles E. Schmidt College of Medicine hopes to deliver a healthy jolt to the economy.

Many medical schools have a huge impact on local economies, with one local example being the Miami Health District, centered on the University of Miami Miller School of Medicine and Jackson Memorial Hospital. FAU is taking a slightly different approach by partnering with multiple hospitals across Broward and Palm Beach counties, but it already has something UM recently opened: a research and development park.

South Florida Business Journal - by Brian Bandell

Google’s Motorola Mobility buy may be boon for South Florida

Brenda Selner — Fri, 19 Aug 2011 21:51:00 GMT

South Florida Business Journal - by Kevin Gale and Ashley D. Torres

Date: Monday, August 15, 2011, 10:00am EDT - Last Modified: Monday, August 15, 2011, 5:53pm EDT

Technology, Mobile

View photo gallery (6 photos)

Mark Freerks
Motorola Mobility and Motorola Solutions operate a 1 million-square-foot space for mobile device and home business services in Plantation, with about 1,400 employees.

Related News

Shares of Motorola Mobility, which has operations in Plantation, soared Monday after Google announced plans to buy it for $12.5 billion in cash.

The initial good news for South Florida jobs is that Google said Motorola Mobility will be run as a separate business.

Motorola Mobility (NYSE: MMI) was up $13.65, or 55.78 percent, to close at $38.12, slightly below Google's offer of $40 a share. Google (NASDAQ: GOOG) closed down $6.54, or 1.16 percent, to $556.34 a share.

The deal is a watershed in the mobile handset market since Google's Android system has made inroads in a market dominated by the iPhone, made by Apple (NASDAQ: AAPL), and BlackBerry, made by Research in Motion (NASDAQ: RIMM). Like Apple, Google will now have a captive hardware maker to go with its software.

With control of mobile content, hardware and software, Google is going to be in a good position to compete with the Apples and Microsofts of the world, said Deborah Vazquez, CEO of Boca Raton-based IT staffing firm Protech and co-chair of theSouth Florida Technology Alliance .

In addition, the deal "ensures that people will continue to innovate around the mobile space and in Android in particular," saidMyk Willis, founder and CEO of Delray Beach-based Myxer, one of the largest service providers of personalized mobile entertainment. "HTC, Samsung and smaller companies, like ourselves, will now have a viable path to market in the mobile industry.”

Nonetheless, the announcement had little impact on Apple shares, which closed up $6.42, or 1.7 percent, to $383.41.

The deal also offered a general tonic to the turbulent stock market, with the Dow closing up 213.88, or 1.9 percent to 11,482.90. Many technology companies have deep reserves of cash, so some Wall Street observers hope more tech deals could be in the offing.

Is An FHA Mortgage Better Than A Conforming One?

Brenda Selner — Tue, 02 Aug 2011 12:52:00 GMT

The FHA is insuring a greater percentage of loans than during any time in recent history. In 2006, it insured roughly 5 percent of the purchase mortgage market. Today, it insures one-quarter. "Going FHA" is more common than ever before - but is it better?

The answer - like most things in mortgage - depends on your circumstance.

Like its conforming counterpart, an FHA-insured mortgage is available as a fixed-rate loan and as an adjustable-rate one. Payments are made monthly and come without prepayment penalties.

That's where the similarities end, however, and decision-making begins. For homeowners and buyers , FHA mortgages carry a different set rules as compared to conforming loans through Fannie Mae or Freddie Mac that can render them more - or less - attractive for financing.

For example:

FHA mortgages can be assumed by a subsequent buyer. Conforming loans may not.
FHA mortgages require mortgage insurance, regardless of downpayment. Conforming loans do not.
FHA mortgages do not have loan-level pricing adjustment. Conforming loans do.

FHA mortgages also require smaller downpayment requirements versus a comparable conforming mortgage. FHA calls for a minimum downpayment of 3.5%. Conforming mortgages often require 5 percent or more.

And, lastly, FHA mortgages are priced differently from conforming ones. Since 2005, the average FHA mortgage rate has been below the average conforming mortgage rate more than 50% of the time, meaning that an FHA mortgage's principal + interest payment is lower than a comparable Fannie/Freddie loan.

Today, conforming mortgage rates are lower.

So, which is better - FHA loans or conforming ones? Like most things in mortgage, it depends. FHA-insured loans can be big money-savers or money-wasters. To find out which is best for you, ask your loan officer for today's market interest rates and study the results.

With less than 20% equity, the answer is often clear.

What's Ahead For Mortgage Rates

Brenda Selner — Tue, 02 Aug 2011 12:46:00 GMT

Mortgage markets improved last week as the U.S. debt ceiling debate continued on Capitol Hill. Bonds traded in a range Monday through Thursday before breaking higher Friday morning.

30-year fixed conforming mortgage rates improved last week, falling to levels just north the product's all-time low set in November 2010.

5-year ARMs improved last week, too. The benchmark adjustable-rate mortgage's average national rate is now tied with its all-time low, also set last November.

This week, the direction of mortgage rates depends on two events:

The resolution of the U.S. debt ceiling debate, due Tuesday
The July Non-Farm Payrolls report, due Friday

Mortgage rates will be volatile as markets grapple with the expectations for the above events, and their eventual outcomes.

Sunday evening, for example, congressional leaders reached an agreement to raise the U.S. debt ceiling by $2.1 trillion, and to introduce $2.5 trillion in budget cuts within 10 years. The deal must pass Congress, however, and until it does, speculation will push mortgage rates around.

Friday's jobs report should swing mortgage rates, too.

After starting the year strong, the 2011 jobs market has faded. Net new jobs have dropped 5 months in the row and the national Unemployment Rate is climbing. Weak job growth portends weak consumer spending and a weak economy - typically two outcomes that are good for mortgage rates.

Because of doubt cast by the debt ceiling debate, though, it's too soon to know how Wall Street will react to the jobs data - strong or weak.

For now, mortgage rates remain low. They may fall further, or they may not. The "safe bet" is to lock.

13 Florida lenders lose FHA approval

Brenda Selner — Tue, 02 Aug 2011 03:02:00 GMT

WASHINGTON – Aug. 1, 2011 – The Federal Housing Administration’s Mortgagee Review Board (MRB) today announced 240 administrative actions against FHA-approved lenders nationwide, with 13 of those in Florida.

MRB sanctions against lenders included reprimands, probations, suspensions, withdrawals of approval and civil money penalties. In Florida, FHA withdrew approval for 12 lenders while one lender will pay a penalty.

“It’s never been more important that lenders doing business with FHA apply our standards to each and every loan they originate and underwrite,” said Acting FHA Commissioner Carol Galante. “FHA requirements ensure homeowners are put on a path of sustainable homeownership and that ultimately helps stabilize entire neighborhoods and communities.”

FHA’s Mortgagee Review Board looks for violations of the agency’s program requirements. For serious violations, the Board can withdraw a lender’s FHA approval so that the lender cannot participate in FHA programs. In less serious cases, MRB enters into settlement agreements with lenders to bring them into compliance. The MRB publishes the actions after all appeals are exhausted and final determinations can be announced publicly.

Florida lenders sanctioned

1. 1st Continental Mortgage Inc., Fort Lauderdale. The MRB permanently withdrew 1st Continental’s FHA approval. MRB says said the lender failed to maintain and implement a Quality Control (“QC”) Plan; and failed to implement and follow HUD/FHA’s Home Equity Conversion Mortgage (HECM) program.

2. Taylor, Bean & Whitaker Mortgage Corp., Ocala. TBW consented to the permanent withdrawal of its FHA approval, without admitting or denying MRB’s factual allegations.

3. WCS Lending, LLC, Boca Raton. The lone Florida lender that did not have approval withdrawn, WCS paid a $3,500 civil money penalty without admitting fault or liability. MRB says WCS posted the HUD seal on a website maintained by a loan officer and failed to register a branch office.

The following Florida lenders were, according to MRB, not in compliance with HUD’s annual recertification requirements:

4. Affiliated Mortgage Company, Tavares
5. Alpine Financial & Mortgage Services Inc., Coral Springs
6. America Mortgage Center LLC, St. Cloud
7. American Capital Financial Trading Corporation, Weston
8. Best Home Loan Inc., Jacksonville
9. Certified Home Loans of Florida Inc., Miami
10. Epix Funding Group Inc., Brandon
11. First Lenders Financial Group Inc., Orlando
12. Gooden Financial Group Inc., Jacksonville
13. Loan Wiz Inc., Miami

The MRB’s decision was published in the Federal Register, which is available online.
© 2011 Florida Realtors®
WASHINGTON – Aug. 1, 2011 – The Federal Housing Administration’s Mortgagee Review Board (MRB) today announced 240 administrative actions against FHA-approved lenders nationwide, with 13 of those in Florida.

MRB sanctions against lenders included reprimands, probations, suspensions, withdrawals of approval and civil money penalties. In Florida, FHA withdrew approval for 12 lenders while one lender will pay a penalty.

“It’s never been more important that lenders doing business with FHA apply our standards to each and every loan they originate and underwrite,” said Acting FHA Commissioner Carol Galante. “FHA requirements ensure homeowners are put on a path of sustainable homeownership and that ultimately helps stabilize entire neighborhoods and communities.”

FHA’s Mortgagee Review Board looks for violations of the agency’s program requirements. For serious violations, the Board can withdraw a lender’s FHA approval so that the lender cannot participate in FHA programs. In less serious cases, MRB enters into settlement agreements with lenders to bring them into compliance. The MRB publishes the actions after all appeals are exhausted and final determinations can be announced publicly.

Florida lenders sanctioned

1. 1st Continental Mortgage Inc., Fort Lauderdale. The MRB permanently withdrew 1st Continental’s FHA approval. MRB says said the lender failed to maintain and implement a Quality Control (“QC”) Plan; and failed to implement and follow HUD/FHA’s Home Equity Conversion Mortgage (HECM) program.

2. Taylor, Bean & Whitaker Mortgage Corp., Ocala. TBW consented to the permanent withdrawal of its FHA approval, without admitting or denying MRB’s factual allegations.

3. WCS Lending, LLC, Boca Raton. The lone Florida lender that did not have approval withdrawn, WCS paid a $3,500 civil money penalty without admitting fault or liability. MRB says WCS posted the HUD seal on a website maintained by a loan officer and failed to register a branch office.

The following Florida lenders were, according to MRB, not in compliance with HUD’s annual recertification requirements:

4. Affiliated Mortgage Company, Tavares
5. Alpine Financial & Mortgage Services Inc., Coral Springs
6. America Mortgage Center LLC, St. Cloud
7. American Capital Financial Trading Corporation, Weston
8. Best Home Loan Inc., Jacksonville
9. Certified Home Loans of Florida Inc., Miami
10. Epix Funding Group Inc., Brandon
11. First Lenders Financial Group Inc., Orlando
12. Gooden Financial Group Inc., Jacksonville
13. Loan Wiz Inc., Miami

The MRB’s decision was published in the Federal Register, which is available online.
© 2011 Florida Realtors®

Brenda Selner

Short Sales Insights

Mortgage Rates Lowest in Over 50 Years

Mortgage Rates Lowest in Over 50 Years

The VA way to finance a home

The VA way to finance a home

Florida Atlantic University’s medical college aims to make an economic impact

South Florida Business Journal - by Brian Bandell

Google’s Motorola Mobility buy may be boon for South Florida

South Florida Business Journal - by Kevin Gale and Ashley D. Torres

Related:

Related News

Is An FHA Mortgage Better Than A Conforming One?

What's Ahead For Mortgage Rates

13 Florida lenders lose FHA approval