www.SellinLA.com NEWSLETTER
Real Estate News You Can Use:  Issue Number 8:  April, 2009
John A. Lucy, Keller Williams, Hollywood Hills/Sunset Strip, California
310-623-1376 JohnALucy@KW.com 310-415-7691

Dear Clients, Friends, Neighbors, Associates:  (Loans, Loans, and Moans...)
 
1. Federal Loan Modifications and Refinancing:  (a little light at the end of the tunnel...)
For those homeowners needing help with loan balances below $729,750 (current conforming limits), here are two website links providing the options for "modifying" or even refinancing your loan terms.
http://www.makinghomeaffordable.gov/
http://www.makinghomeaffordable.gov/docs/borrower_qa.pdf
The questions and answers are good explanations of what might be available.   The first type of modification is for those loans "owned" by the two Federal Agencies, Fannie Mae and Freddie Mac, even if your loan is still billed and serviced by your original lender.  You can find out whether your loan has been "sold" to one of those Agencies by using these second two website links:
www.fanniemae.com/loanlookup
www.freddiemac.com/mymortgage
The second type of modification is through lenders who accepted "bail out" money, supposedly cooperating with the Federal Government in helping homeowners to avoid foreclosure.  In their words from the above websites:
"Can Making Home Affordable help me if my loan is not owned or securitized by Fannie Mae or Freddie Mac?
Yes. Making Home Affordable offers help to borrowers who are struggling to keep their loans current or who are already behind on their mortgage payments. By providing mortgage servicers with financial incentives to modify existing first mortgages, the Treasury hopes to help as many as 3 to 4 million homeowners avoid foreclosure regardless of who owns or services the mortgage."

2. Those looking for help should beware of SCAMS:  (if it sounds too good...)
There are lots of "loan modification" experts out there taking advantage.  Free counseling is available by going to www.hud.gov and clicking on "Foreclosure Avoidance."
Never pay upfront fees, wire them money, or stop payments because they say so.
Don't believe guarantees of success, and do contact your attorney or lender.
Don't sign anything you have not read or you don't understand, especially the Title to your house.

3. New Tighter Rules from Fannie / Freddie / and Lenders:  (gee, thanks...)
After April 1st, loans for condos being sold to Fannie Mae and Freddie Mac, will get slapped with extra fees:  1/4 % more just because condos are considered an "adverse market" risk, 1.5% more if the buyer's credit score is "below optimal" 720, and 3/4% more if the buyer opts for an interest only loan payment.  In addition, all appraisals will be assigned by outside "appraisal managers", charging higher non-refundable fees than the lenders.

4. If you are Waiting for Loan Approval, before removing your contract's Loan Contingency:
Here are the questions you should ask:  (courtesy of Dana Dukelow, MetroCities Mortgage):
"The following is a list of the most important items.  You may also ask the lender for a copy of the "loan approval" form that is given to the loan officer after the underwriter has approved the loan.
1)  Have all the "Prior to Docs" conditions been cleared?  These are the loan conditions that the lender requires before they will allow loan docs to be drawn.
2)  What are the "Prior to Funding" conditions?  These are the conditions that have to be cleared before you can fund the loan.  Many times these conditions are related to the escrow company.
3)  Has the "4506T Form" been processed and have they received the tax returns back from the IRS? This is a new thing in the past couple months.  The lender submits this "4506T Form" to the IRS to request copies of the tax returns the borrower submitted.  We are seeing many issues where the returns coming back from the IRS have info that was not included in the loan application.  SO MAKE SURE THEY HAVE RECEIVED AND APPROVED THE 4506T TAX RETURNS!
4)  Has the appraisal been approved?  If so, have they asked for a "desk review or field review"?
5)  CONDOS - have they received and approved the "Condo Certification Form" or the "Limited Condo Cert"?  Be very aware of any litigation with a building!
6)  CONDOS - has the underwriter asked for info on pre-sale requirements, budgets, insurance?  Most condos now go through a condo approval in addition to the underwriting.  This generally happens after the loan has been underwritten.  Ask if the condo building has been approved by their condo department.
These are some of the most important issues I am seeing right now.  Always ask the lender for DETAILS on all conditions before you agree to sign off on contingencies!"

The Finest Compliment I Can Receive is a Referral from Past Clients and Customers.
Let me know how I can help.  Thank You for your Trust.--John.
Please rest assured that your personal information is secure with me, and that this is not part of any outside vendor connection.  Please feel free to discontinue these mailings at any time by sending a quick "opt out" email to me at JohnALucy@KW.com, or by leaving me a voice mail at my direct phone number 310-623-1376.

 

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