Tag Archives: Foreclosures

Achieving The American Dream

Achieving The American Dream

The American Dream. Having a loving family, attaining a stable job, and most importantly possessing your own home, even if it’s not in Santa Maria, California or somewhere near the Central Coast. All of these accomplishments can be challenging at times, especially taking the next step of  having your own home. With financial planning and legalities, it all starts with a bit of knowledge of the industry and some research.

Purchasing a Home in the United States

The United States Real Estate market is tremendous, especially the Santa Maria Real Estate area since it is continuing to grow. One thing to keep in mind is that each state has their own unique set of policies, set of laws, and not to mention taxes. So don’t be surprised when you notice different tax rates in various cities and states. Also Keep in mind that their are many incentives for individuals such as veterans who have served our country. Veterans qualify for loans known as VA Loans and many lenders out there offer these kinds of incentives that better help them achieve the home of their dreams.

Property Taxes

As mentioned above, taxes vary by state. So when you are asking yourself how much house can I afford, do not forget to include property taxes as the tend to add up. They are used to fund public projects such as schools, parks, and things such as law enforcement. Knowing ahead of time what kind of taxes you will be paying will give you a better picture of the cost of living in your new home, especially if you are planning on moving out of state; do some research.

Educate Yourself On the Real Estate Market

One should also know what exactly drives house prices in the market, especially in the Central Coast Real Estate area because it has gained popularity in past years. Instability in house prices vary from state to state and from region to region. For example, a home in the Arroyo Grande, California will not have the same price as a beach from property in the Pismo Beach, California area even though their proximity is not to far apart. Same applies to locations such as Los Angeles, California and New York (especially within the city). We at Greater Mortgage Solutions and Valley Hills Realty want to teach you about the macro and micro trends that influence the real estate market. That way you can make a better decision when making a mortgage deal that is being offered to you.

So when you, a family member, or a close friend of yours is ready to achieve The American Dream, consider allowing one of our team of experts at Greater Mortgage Solutions and Valley Hills Realty help you attain the precise mortgage and the home you have always wanted. We are filled with team members that are ready to help you every step of the way.

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New Law Giving Prospective Renters In California Foreclosure Warning

Coming into next year there will be many new laws in California regarding foreclosures and giving consumers more rights.  Some of these rights are for the renters that have fallen victims to the homes they were renting being foreclosed on without warning.  Some of these new laws are giving the home owners protection due to the scrupulous ways the banks have handled the foreclosure process and loan modification process.

 

Senate Bill No. 1191
CHAPTER 566
An act to add and repeal Section 2924.85 of the Civil Code, relating to
landlord-tenant relations.
[Approved by Governor September 25, 2012. Filed with
Secretary of State September 25, 2012.]
legislative counsel’s digest
SB 1191, Simitian. Landlord-tenant relations: disclosure of notice of
default.
Existing law generally regulates the hiring of real property, including,
among other things, specifying certain obligations imposed on landlords
and obligations imposed on tenants. Existing law, until January 1, 2013,
requires a tenant of property upon which a notice of sale has been posted
to be provided a specified notice advising the tenant that, among other things,
the new property owner may either give the tenant a new lease or rental
agreement, or provide the tenant with a 60-day eviction notice, and that
other laws may prohibit the eviction or provide the tenant with a longer
notice before eviction.
This bill would, until January 1, 2018, require every landlord who offers
for rent a single-family dwelling, or a multifamily dwelling not exceeding
4 units, and who has received a notice of default that has not been rescinded
with respect to a mortgage or deed of trust secured by that property to
disclose the notice of default in writing to any prospective tenant prior to
executing a lease agreement for the property. The bill would provide that a
violation of those provisions would allow the tenant to void the lease and
entitle the tenant to recovery of one month’s rent or twice the amount of
actual damages from the landlord, and all prepaid rent, if the tenant voids
the lease and vacates the property in addition to any other remedies that are
available. The bill would also provide that if the tenant elects not to void
the lease and the foreclosure sale has not yet occurred, the tenant may deduct
a total amount equal to one month’s rent from future rent obligations owed
the landlord who received the notice of default. The bill would specify the
content of the written disclosure notice, and would require the notice to be
provided in English and other languages, as specified. The bill would exempt
a property manager from liability for failing to provide the written disclosure
notice unless the landlord notified the property manager of the notice of
default and directed him or her in writing to deliver the written disclosure.

For more information on this bill and additional information follow the following link.

http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_1151-1200/sb_1191_bill_20120925_chaptered.pdf

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What To Do If You Get Scammed From A Loan Modification

For the most part everyone knows by now, the numbers of homeowners struggling with foreclosure that are increasing. Countless homeowners are having trouble making their mortgage payments and are a missed payment or two away from a notice of default.  True they will be having to deal with how to fix bad credit and in the future how to get credit score back up.  But until that time you don’t want to be scammed if you are trying to save your home many of the homes in Santa Maria are for sale are either a short sale or even a foreclosure.   The reality is that the Santa Maria real estate market here in Santa Maria, California has been hit hard with values falling to over 50% of what their values were in the peak.

Many people will investigate any alternative to try and spare their house from foreclosure. This opens the door to scammers. The fact is, mortgage modification and foreclosure relief scams are popping up everywhere you go. As a homeowner you’ll want to know that they are out there and what to look for in order to steer clear of them. A scammer cannot only cost you money but can cost you vital time that you could use to save your house or get ready to move. You need dependable information on foreclosure or the short sale procedure in a timely manner.

Nearly all the ads you’ll notice will claim to help you save your home from foreclosure or lessen your house payment to an easily affordable level. Additionally they infer that they are associated with a government program or enjoy a direct line to your loan company. They don’t.  Certainly, there are honest businesses around that legitimately make an effort to aid homeowners yet, sadly, there is a high number that are simply scams.

Scammers are simple enough to spot simply because they generally ask for money up front. But, they’ve got other sorts of strategies as well. Look for these clues:

1. Someone who demands money at the start before they actually do anything. Many states have recently passed laws regulating money paid in advance for mortgage modification or foreclosure services. The most effective rule of thumb should be to not pay for anything in advance.

2. The scammers have ways of tracking down property owners who have missed payments or have their properties scheduled for auction. They then target these house owners knowing that they are more susceptible since they will be in a troubled situation. When you are one of these homeowners be extra vigilant in any dealings you may have with foreclosure rescue or mortgage modification companies.

3. Some scammers attempt to get you to sign the deed to your house over to them claiming they are going to make the payment on your property. They will not.

4. You should not make a mortgage payment to any person besides your lender. More than likely, you will not see that money again and neither will your lender.

5. Be aware of the phrasing of certain promotions that make it sound like they work directly with a government bailout program. They almost certainly do not. They more than likely would just like to make you another high fee, high interest consolidation loan which will only buy you a little time at great cost.

6. Getting a letter from a real estate agent offering you free services to do a loan modification.  Unless they are a govt sponsored consumer group they do not receive any funding so what is the motive to offer you this service for free? That truly involves lots of paperwork as well as time on the phone?  Well its to eventually get you to sell the home on a short sale so that they can earn a commission on selling your home but not necessarily help you get the loan modification as you may have been hoping for.

Ok, so what if you’ve recently been scammed? Well, you possibly can report the issue to the Federal Trade Commission (FTC). They have a web based complaint assistant and have a hotline at 1-877-FTC-HELP. You can also uncover good information regarding foreclosure or short sale consequences online.  There are many benefits to doing a short sale as well but you will have to read about that on my other blogs.  One thing to keep in mind regardless of what you plan on doing is that the Mortgage Debt Forgiveness Act of 2007 expires in 2012 and there will be tax consequences that will occur after that.   Please seek some legal counsel as well as some tax council as to what you want to do next year if you feel that maybe you will not qualify for a loan modification to avoid some serious tax consequences from the I.R.S.

There is also the NeighborWorks America group that educates the general public about loan modification scams. The best way to avoid these scams would be to educate yourself on the many varieties of scams and be very cautious about any individual offering to help modify your loan or save your house from foreclosure.

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Do You Understand How A Short Sale Will Influence Your Ability In Purchasing Another Home

There is alot happening within the realm of real estate every where not just in the Santa Maria real estate market and that holds true with just about all the mortgage home loans having to go  bad, and unless you have been existing under a rock then you ought be some what familiar with the expression short sale which has come to be as familiar as the word foreclosure.   Quite a bit of of you that live in either a house or condo regardless of whether or not you own it or not, you have had reminders left on your building, that there are a whole lot of people eager to accommodate to do a short sale and that it is much better for someone to do than it is a foreclosure, (I have left a few myself on a few doors).  For those that do not know what a short sale is, which is basically when a homeowner sells his place for less that what he currently owes.  now there are some benefits to doing a short sale, first one is when do you need to be a homeowner again?

Supposing that you may be able to compel your lender to allow you to do a short sale even if you have not missed any payments.  Then FHA will allow you to acquire another home the next day, as long as the home you are acquiring is not at all superior to the home you now have.   The challenging  part will be getting your lender to let you to do the short sale, a lender may refuse to allow you to do a short sale, as stated before this is the difficult part procuring the approval when you have not missed a payment and a short sale transaction normally takes months to close.  Assuming that you do miss payments and you do a short sale, FHA guidelines now state that you have to wait at least 3 years, before you could purchase another home provided that you were to try to acquire a FHA loan.  This is where carrying out a short sale and just letting your place go to foreclosure genuinely does not at all make a difference in you getting financing again.  Now the 3 years is from the date of closing not at all from the date you stopped making payments or the time you initiated the process towards your short sale or foreclosure.

But now moving on to other loans outside of simply an FHA there are a few differences when it comes to obtaining a loan other than a govt. loan, and doing a conventional loan.  Currently Freddie Mac and Fannnie Mae are the two largest investors at this time.  These two humongous govt. sponsored corporations acquire pretty much all the mortgages out there that the banks are now doing, reality is that most of the homes in Santa Maria are being done via FHA.   With the condition that you do a short sale and from the date of closing your transaction your waiting period is merely 2 years to buy another house.   In any event please keep in mind if you are on a separate loan whether it is investment property or you co-signed on it, there can be no mortgage lates within the 12 months of application.   With the condition that you foreclose then the waiting period is 5 years from the date of your foreclosure date.  That is a huge difference in regards to getting back in the market in addition to becoming eligible to obtaining sponsorship and becoming a homeowner again.  Then it depends on credit, what is your credit going to be, its a fact that after doing a short sale or foreclosure you will be dealing with bad credit but its only temporary???

Keep in mind houses are so very much less now and I seriously doubt they will be doubling in 2-3 years time in essence if the house is unaffordable now you can be in a preferable financial position in 2-3 years in addition to with less stress.   In closing on the assumption that you find yourself in a position of conceivably having to do a short sale or losing your house you are not alone and for many when taking their finances into consideration a number of  homeowners have come to learn after some time that it could be a blessing in disguise.

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Do You Know The Difference Between A Recourse Loan Or A Non-Recourse Loan?

You may have had your home recently foreclosed on and part of the Santa Maria real estate market on a mortgage home loan that you were upside down on, and maybe you may be plain tired and frustrated and about to become another statistic, but what you need to know is your loan recourse or non recourse, and what does that mean?  Just keep in mind the following is intended for general information only please seek legal counsel for your own specific situation.  Most of this information will be how California treats mortgage loans if outside California you may want to see how your state treats mortgage home loans.

This blog will be focused on what the difference is between a recourse and a non-recourse loan because there is a huge difference and most are not aware of the difference.   With all the Santa Maria homes for sale that are either in foreclosure or homes going through the short sale process it is something homeowners should be familiar with. So lets go with an everyday story you bought your house 2003 you paid $280,000.00 you put no money down when you bought your home with one of those popular 80/20 loans.   A couple of years goes buy and now your home is unbelievably worth $500,000.00.  Just like everyone else you get all kinds of good stuff in the mail full of useful advice to consolidate all of you bills and even make some more home improvements and get a new car using the equity of your home and only make one payment and get so much done.  Why wouldn’t you do it, so you take out a loan against the house and now you owe $450,000.00.  Now let’s fast forward to today.

Well the economy is not so good and your home is not worth $500,000.00 in fact its not even worth what you bought it for now.  More like $250,000.00 and you can’t make the payments anymore because the payments are based on what the home is worth.  So you are forced to either do a short sale or just walk away like so many others since you can no longer make the payments on your home.   But before you do just walk away and your home is another foreclosure, here is something to think about.

Loans that are recourse are basically loans, that allows the lender to use legal means to collect the deficiency balance from the borrower after the asset has been taken back and sold.   Kind of like your home now where you have a loan for more than the what the house is worth.  That being said the bank can come after you legally for the difference, which is kind of tough for most people since they don’t carry 100k on them.  Loans that are non-recourse are loans that the bank cannot come after the borrower for the deficiency amount.   For reference you can refer to California Code.  Please keep in mind that this pertains to your home not to your rental properties and investment homes.

http://www.legaltips.org/california/california_code_of_civil_procedure/577-582.5.aspx

In California when you buy a home it is considered “purchase money” whether it be one loan or two loans.  A loan that is considered a purchase money loan is a non-recourse loan.  The problem with most homeowners is that they refinanced their homes and turned their non-recourse loans into recourse loans.    Although if the lender did a non-judicial foreclosure he cannot come after you in the state of California because that is the trade off that they have for doing a non-judicial foreclosure vs. a judicial foreclosure which means going to Court.  So you get the benefit of the “one action rule”.  Unless you had a second that got completely wiped they can come after you for the deficiency and there are still more exceptions to the rule as you read along.

Now here is where it can get tricky if you have two loans but from different lenders and you don’t have enough to pay off the second,,,,, well the second can come after you but if both loans are from the same lender lets say both are with Wells Fargo and not purchase money so for example if you took out a second later you are okay AS LONG AS BOTH LOANS ARE NOT FROM DIFFERENT LENDERS.   The lender will come after you for the difference and can sell your account to collection agencies as well.   That means they can sue you and levy your bank account or even garnish your wages.

IF YOU HAVE AN FHA OR A VA THESE RULES DO NOT APPLY THESE ARE FEDERALLY SPONSORED LOANS AND SUPERSEDE CALIFORNIA STATE LAWS AND ,,,,,,YOU ARE CORRECT ARE RECOURSE LOANS….home being financed after the collapse are FHA financed and yes they can come after you.  I am not sure if you got that all down and I do hope that this made sense to anyone reading this.  If you are unsure if you will be sued seek some legal advice.

BUT THERE IS HOPE If YOU DO A SHORT SALE BEFORE THE YEAR END. For one California has a new law that any lender that agrees to a do a short sale whether it be a second or investment property.  That they will not come after you for any funds owed.  This is a huge weight off the shoulders of many homeowners that may be thinking of having to do a bankruptcy only to protect themselves.  Due to there being a deficiency amount on the money owed to the bank.  Last but not least the home forgiveness act which expires this year DEC 31, 2012.  IRS CONSIDERS ANY DEBT FORGIVEN TO BE TAXABLE INCOME.   So do the math with me you owed $500k you short sale for $250k the IRS WILL TAX YOU $250K UNLESS YOU ARE INSOLVENT OR FILE BK or the home was your primary residence.  But that all changes on Jan 1, 2013 there will be a tax bill unless there are changes in the Govt.  but it seems that even the Govt. is looking for ways to generate money and would not expect a bailout.  If you do not qualify for a loan modification seriously consider a short sale soon.

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