FHA "Back to Work" Mortgage Helps Buyers Return to Home Ownership

If you previously lost a home to foreclosure, or experienced a bankruptcy or short sale, there's good news: you might be able to buy a home again, sooner than expected!

A new mortgage loan program by the Federal Housing Administration paves the way for a return to home ownership. This is great news for Fountain Hills real estate!

The "Back to Work" mortgage program is designed for prior homeowners who experienced foreclosure, or other adverse action, because of a temporary income loss. This is not a miracle cure for every situation - but it should help a significant number of people. Here are the basic requirements:

• Documentation to prove the cause of the income loss. 
• Loss of income must have been involuntary in nature. 
• The income loss must have accounted for at least 20% of household income. 
• The income loss must have lasted for at least six months.  
• Proof that your income has recovered enough to afford a new mortgage.

The lender will review your credit history before and after the income loss period. They will be checking to see if your credit was good before the income loss - and if the income loss caused the foreclosure, bankruptcy, or short sale. There are a couple more requirements:

• Credit history must show no late payments during the past 12 months.
• You must complete housing counseling through a HUD-approved agency. The counseling can be completed in person, by telephone, or through online sessions.

The standard FHA mortgage conditions also apply. While the Back-to-Work mortgage program shortens the timeline to return to home ownership - it doesn't shorten the mortgage process! However, it gives former Arizona homeowners a good opportunity to buy a home again, before home prices and mortgage interest rates climb further.

Let me provide you with professional guidance for our Fountain Hills real estate market! As your  Accredited Buyer Representative, I will refer you to trustworthy mortgage lenders, and help you throughout the home buying process. I have helped Arizona home buyers for over 30 years, and I'd like to help you too!

 

Contact me today for complete home buying help in Fountain Hills!

Tina Nabers

Nabers Property Management & Real Estate

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Faster Short Sales Benefit Fountain Hills Home Sellers

Fountain Hills home values gained ground during 2012, and there is reason for optimism during 2013!

Recent updates to the short sale process, along with an extension of the Mortgage Debt Relief Act, will enable distressed homeowners to sell their homes with less red tape and a quicker turnaround. This will help property values across the board! Here's what you need to know!

First, as part of the Federal "fiscal cliff" budget compromise signed January 1, 2013, the Mortgage Debt Relief Act has been extended! Without the extension, short sellers would have been on the hook with the IRS for any forgiven mortgage debt. The MDRA allows an exception to this tax rule through 2013.

Next, there is good news from Freddie Mac and Fannie Mae. The new short sale guidelines that were put in place November 1, 2012, have reportedly cut down on short sale processing time by 50% to 75%! There are other advantages to the new rules, and here are a few of them:

1. Up to $3,000 in relocation assistance is available to distressed homeowners who successfully complete a short sale through Freddie Mac or Fannie Mae.

2. Mortgage servicers can directly approve qualifying short sales without going to Freddie or Fannie for another layer of approval.

3. Mortgage servicers must acknowledge receipt of a short sale request within 3 days.

4. Short sales must be approved or denied within 30 days. In more complex cases involving a second mortgage or some other issue, the review process cannot exceed 60 days.

The above guidelines pertain to mortgages backed by Freddie Mac and Fannie Mae. Click on the respective links to verify if your mortgage loan is associated with one of them.

Please keep in mind that short sales are meant to help home sellers who are unable to keep their homes due to a personal hardship. However, you do not need to be behind on your mortgage to be eligible for a short sale. This is another rule change that became effective in November 2012.

Short sales are preferable to foreclosures because they are based on current market values, whereas foreclosures can be heavily discounted when they hit the market. Short sales prevent home abandonment and blight. And because home sellers have incentive to complete a short sale, they are more likely to maintain the condition of their home. All this adds up to healthier home values for everyone concerned!

Fountain Hills real estate has many positives going for it, and good housing polices like these should help improve home values throughout 2013!

Do you have questions about home values in your Fountain Hills neighborhood? When you are  selling a Fountain Hills home, put your trust in my 33 years of local real estate experience! Contact me today for expert, reliable help!

Tina Nabers

Nabers Property Management & Real Estate
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Can You Buy a Fountain Hills Home After Foreclosure?

There's good news for prior homeowners in Arizona who experienced a foreclosure, personal bankruptcy or short sale: you can buy a home again. There is a minimum waiting period, and the amount of time you'll spend in the "penalty box" varies depending on the circumstances.

Here's an outline put together by the Wall Street Journal, with my own two cents thrown in:

If you completed a Chapter 13 bankruptcy, you may be eligible for a new FHA mortgage in as little as 12 to 24 months - as long as your credit history is clean, and you have a suitable income and down payment for qualifying.

If you had an FHA-backed mortgage in the past, and experienced a foreclosure or short sale, you need to wait at least 3 years before being considered for another FHA loan. If you can prove that the previous foreclosure or short sale resulted from events beyond your control, you have better odds of approval.

If your prior mortgage was backed by Freddie Mac or Fannie Mae, and you experienced a short sale or foreclosure, you may be waiting up to 7 years before you are eligible under their guidelines.

In general, short sales, depending on how they were reported by the previous lender, could be treated equal to a foreclosure event. VA and FHA mortgages are the most forgiving when it comes to issuing a new mortgage after a previous short sale, with a wait period of two or three years, respectively.

It's best to leave nothing to chance and obtain a copy of your credit history before beginning your Fountain Hills home search. The key to qualifying rests not only in waiting out the clock, but in improving your credit score to meet current underwriting criteria.

While mortgage underwriting will be stringent, lenders have shown a willingness to reconsider former homeowners who lost their home due to events beyond their control. Over 700,000 former homeowners nationally are now re-eligible for a mortgage. We can expect that the Arizona real estate market will have more than its fair share of returning home buyers.

With the escalating cost of rent, compared to reasonable home prices and low mortgage interest rates, home demand in Fountain Hills and the greater Phoenix-Scottsdale area is expected to increase!

Whether you are a first-time home buyer, or you are a former homeowner returning to the market, you need professional real estate guidance you can trust! As your Accredited Buyer Representative, I have the experience and local knowledge to guide you through our Fountain Hills real estate market. I have helped Arizona home buyers and sellers for over 30 years, and I'd like to help you too!

If you are ready to enjoy the splendor of panoramic, desert views from your own home, let me show you how to get started. Contact me today and find out more about home buying in Fountain Hills!

Tina Nabers
Nabers Property Management & Real Estate
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Fountain Hills Home Sales Show Fewer Distressed Properties

The weather may be cooling off, but home sales in Fountain Hills are heating up! Best of all, we are seeing fewer short sales and foreclosures in the market. Also, the ratio of short sales to foreclosures shows a sharp decline in foreclosures.

Here's how the Fountain Hills and Scottsdale, AZ distressed property ratios looked as of July 31, 2012:

• Zip code 85268 - short sales 14% of home sales; foreclosures 5%
• Zip code 85259 - short sales 16% of home sales; foreclosures 3%   
• Zip code 85255 - short sales 18% of home sales; foreclosures 2%
• Zip code 85268 - short sales 31% of home sales; foreclosures 5%

When considering the impact of distressed home sales, short sales are the lesser of two evils, because these sales are conducted using current fair market value.This preserves the market value of nearby homes. Foreclosures are often sold at a discount from fair market value, which can pull down values of surrounding homes.

Nationally, we are seeing a brighter picture across the board. HousingWire reports that nearly 2.5 million distressed homes will be removed from the "shadow inventory" during 2012.  There is also good news from Lender Processing Services, which reports that mortgage delinquencies are down by 30% since the peak of the housing crisis in 2010. 

If you're still uncertain about buying or selling a home in today's market, keep this in mind: short and foreclosures are a part of any housing market, even in the most robust economies. Waiting for these categories to "disappear" before you buy or sell a home isn't a realistic strategy.

For the latest Fountain Hills home sales data and market activity, contact me! I have over 30 years of experience in Fountain Hills real estate which will be your advantage when buying or selling a home!

Whether you are relocating to Arizona or you are already a resident of our sunny state, I can help you make the most of today's opportunities!

 

Tina Nabers
Nabers Property Management & Real Estate
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Short Sale Rule Changes Could Help Fountain Hills Home Sellers!

While home values have been improving in Fountain Hills and the greater Phoenix-Scottsdale area, prices remain below the peaks reached in 2006. Homeowners who made purchases during the height of the housing boom have been struggling with negative equity. Add in a personal hardship, and it becomes a recipe for foreclosure. 

Fortunately, there is help on the horizon! The Federal Housing Finance Agency has announced new short sale guidelines effective November 1, 2012, for mortgages held by Fannie Mae and Freddie Mac. These government-sponsored agencies back more than half of all residential mortgages in the United States, and their short sale improvements could have a wide effect on the housing market. 

Here are some highlights of the new short sale program:

Homeowners who are current on their mortgage can be eligible for a short sale, if they have a qualifying hardship. Hardship categories include job loss, death of borrower or co-borrower, divorce, disability, or job relocation exceeding a distance of 50 miles from the home.

Mortgage servicers who work on behalf of Fannie Mae and Freddie Mac will be empowered to directly expedite qualifying short sales. 

Documentation requirements for homeowners “most in need”, who are behind on mortgage payments and have qualifying hardships, are significantly reduced. 

Homeowners who have sufficient assets will be asked to make a financial contribution to the short sale. In return, Fannie Mae and Freddie Mac will not pursue a deficiency judgment for the difference between the sale proceeds and the outstanding mortgage balance. This clause seems to address the Mortgage Debt Relief Act of 2007, which is scheduled to expire at the end of the year.

Overall, the changes in the short sale process should reduce new foreclosures and further stabilize home prices. This is good news for all Arizona homeowners! Median home values in the Phoenix-Scottsdale area have improved about 28% from a year ago, thanks in part to a reduced inventory of homes for sale. 

If you are thinking of selling your Fountain Hills home, contact me for the best in local expertise and market guidance! With over 30 years of experience in Fountain Hills real estate, I have helped home sellers succeed throughout all market conditions. 

When you have questions about the Fountain Hills real estate market, feel welcome to call me! I will be happy to help you! 

 

Tina Nabers
Nabers Property Management & Real Estate
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See Homes for Sale in Fountain Hills
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