“Nearly half of the 1.3 million homeowners who have accepted loan modifications under the Home Affordable Modification Program have washed out of the program, according to the latest report from the Treasury Department. At the end of July, there were 421,804 homeowners enrolled in permanent HAMP loan modifications, and another 255,934 borrowers in active trial loan modifications.All told, a total of 677,738 homeowners were in permanent or trial HAMP modifications. But almost as many borrowers had already washed out of the program — 629,751.
Many analysts expect that more than half of HAMP loan mods will end up redefaulting. With fewer homeowners entering the HAMP pipeline — only 24,577 new trial modifications were reported in July — it’s considered unlikely that the program will meet its initial goal of helping up to 3 million borrowers avoid foreclosure.
In releasing its “Housing Scorecard” for August, the Obama administration nevertheless offered a positive outlook on the overall housing picture, saying the HAMP program represented “just one, targeted piece of the administration’s larger efforts on housing.”
From April 2009 through the end of June 2010, the Federal Housing Administration (FHA) has also entered into 472,000 loss mitigation and early delinquency interventions, and loan servicers modified 1.4 million mortgages outside of the HAMP process, the scorecard noted.
The 3.15 million mortgages modifications started during the period was more than double the 1.24 million completed foreclosures.”

Time will tell, right now I see longer times with the trial payments. It is of utmost importance to keep your trial payment, you miss one, you are out.

When BofA started with their loan modifications 2 years ago, they had an 80% default rate. As it looks right now, the default rate will stay high, around 50%.  On the bright side, the other 50% is able to stay in their house and they would have lost their house otherwise.

Usually when I sit down with my clients I can pretty much tell whether a loan modification is doable or just an extension in staying in the house. For some people, going through the loan modification process means that they can stay longer in their house and that was what they wanted. As a whole I see that as part of a ’strategic short sale’. My website has a link with more information about short sales.

Have a great day!

Mirjam

About 99% of buyers will make an offer with what we call contingencies… what was that? Yes, I call it the ‘buts’. I’d like to buy the house but: I need a mortgage and the house needs to qualify, I want to make sure the house doesn’t have serious flaws, I want to make sure I really want to live in that neighborhood, I want to….

The list if reasons can be different for everyone. Some of you might say, wait a second, you cannot have an endless list of ‘buts’. Basically the main ones are: Financing, Inspections and Title.

Financing: the house needs to appraise and the bank needs to agree.

Inspections: buyer can do any and all inspection as to satisfy himself as to the condition of the property. This covers a wide range if subjects, even the neighborhood is involved. That’s why the list is endless: depending on property and buyer. Everyone has different priorities.

Title: once the escrow is opened,  the title company provides a preliminary title report, stating the legal owners, the liens against the property, the easements etc etc. A problem with title can severely delay the sales process.

In our area, in general,  the contingency period is 17 days. This period gives a buyer the time to have all ‘contingencies’ taken care of. Should something seriously pop up you can either ask for an extension to do more inspections, ask for money to remedy the problem, sign of on the contingencies and move forward with the sale or decide that this is not your house and cancel the dale. You can say, when inspection period is up you have to really decide (what is that expression again?).

There is a lot more to say about the subject but this is the basics to remember about the ‘buts’.

Have a great Sunday!

Mirjam

Just sharing with you the local sales numbers in Sonoma County as of 5 minutes ago, all the properties that sold since January 1, 2010:

Total sold properties: 3131. Of these, 1538 were either foreclosure of shortsale. Bottom line, this year so far 50% of all the sales were distressed sales. This is not saying anything about the future but just the plain numbers as of the moment I am writing this.

With the current interest rates at a historic low, the numbers mean that it is a great time to sell property and a great time to buy property.

On a side note: despite what you might think: foreclosures are not always the best deal in town.

Have a great day, enjoy this sunny afternoon!

Great news from the Sonoma County Permit & Resource Management department!

For a limited time, permits to legalize non-permitted construction will not be subject to civil penalties and investigative fees.

Projects eligible to participate are:

Residential buildings and accessory structures  •  Construction completed prior to July 13, 2010 • ‘Self-Disclosed” construction

Eligible permit applications must be received between August 1, 2010 and February 1, 2011.

Now is the time to safe money, permitted construction always results in higher value!

Mirjam

To find out whether you are eligible, check out the following link:http://hosted.cdpe.com/14365/Resources.aspx

Mirjam

There is something special about owning an older home. Personally, I love older homes in older neighborhoods. For that reason, I love the MacDonald area. But older homes are built in a time when building rules and products where different and there are new laws to comply with when remodeling or perhaps selling a house.

Starting today, renovations that disturb lead-based paint in older residential dwellings and child-occupied facilities must generally comply with the Lead-Based Paint Renovation Rule of the Environmental Protection Agency (EPA).

Under the newly implemented rule, renovators of target housing built before 1978 must now be trained and EPA-certified to perform safe work practices to prevent lead contamination.  Additionally, renovators must deliver EPA’s lead renovation pamphlet to an occupant within 60 days before a project begins (and, if mailed, at least seven days before a project begins).  Renovators must also obtain the occupant’s signed acknowledgment of receipt or substitute documentation as specified.

The EPA issued this rule in 2008, but delayed implementation until now.  The rule generally applies to building contractors, handymen, residential landlords, property managers, and anyone else who is paid to perform renovations or to direct workers to perform renovations as specified.  The lead renovation rule does not apply to homeowners renovating the homes they live in.  However, sellers of target housing must, among other things, disclose to their buyers any known lead-based paint and lead-based paint hazards (C.A.R. Form FLD).

Should you decide to sell your older home and are going to repaint the house, you need to keep the above in mind.

Have a beautiful day!

Mirjam

Bottom line: a loan modification is doable but is still a lot of work and persistence but the HAMP program gives great guidelines on the likely hood of a decent loan modification in a specific situation. As to HAFA, the short sale alternative for foreclosure: it is not applicable for everyone, some distressed homeowners will not fall in the HAFA guidelines they will have to do a non-HAFA short sale which is not a bad alternative, just more work for your realtor.  And HARP, that is a special refinancing program that might work for some.

As to all these programs: it is good to discuss your options with your Realtor -preferably one who has a CDPE certification- and your lender -or the one your Realtor works with. Reason, a better understanding of your specific situation sets realistic expectations and you will be able to make an educated solution.

And yes, yours truly is CDPE certified and happy to help.

Don’t forget to enjoy this beautiful Sunday.

   Mirjam

A great article in the Los Angeles Times: it is an easy to read outline of the new rules.

It is still a great time to buy but also a great time to sell with the tax credit for repeat home buyers. So you can sell your home and take advantage of the tax credit to buy your new home. The housing inventory in Sonoma County is so low, properties priced well sell fast and you are able to take advantage of the current market to move into your dream house.

  Mirjam