I wanted to bring to your attention some important details about the recently announced Home Affordable Foreclosure Alternatives program (HAFA), which provides instructions for lenders and servicers participating in the Making Home Affordable Program and Home Affordable Modification Program (HAMP).
HAFA helps standardize the short sale and deed-in-lieu process by creating an alternative to foreclosures for homeowners unable to successfully modify their troubled mortgage under HAMP.
Although not perfect, the program reflects C.A.R.’s efforts in the federal arena to standardize the short sale process, protect your business, and safeguard commissions. It also makes clear the timeframes by which servicers must respond to an offer on a short sale.
The HAFA program will permit pre-approved short sale terms before a property is listed; prevent servicers from attempting to reduce real estate commissions established in the listing agreement as a condition for short sale approval; release borrowers from future liability for the debt; and provide financial incentives to borrowers, servicers, and investors.
Under terms of the program, the borrower and/or listing broker have three business days to submit an executed purchase offer and related documents to the servicer on a short sale, and the servicer has 10 business days to respond to an executed purchase offer. The servicer may negotiate the real estate commission prior to the listing of the property, not to exceed 6 percent, but once this has been agreed to the commission may not be reduced at a later date.
The servicer also will determine the minimum net proceeds for a short sale; if an offer presented to the servicer by the borrower or listing broker meets the net proceeds requirement, then the servicer must accept it.
Each participating servicer also must develop a written policy that describes the basis on which the servicer will offer the HAFA program to borrowers. All borrowers must be evaluated for a loan modification prior to going to HAFA. For additional information, please go to car.org at http://www.car.org/governmentalaffairs/federal/ustreasuryfap/.
HAFA is a step in the right direction toward helping distressed homeowners now, and is an effective tool to quickly move distressed properties through the market. Although HAFA goes into effect April 5, 2010, our expectation is that servicers may choose to implement it earlier. The program is available only for non-Fannie Mae- or Freddie Mac-owned loans up to $729,750. C.A.R. will continue to reach out to servicers and lenders to encourage their adoption of HAFA and other programs that will help California’s housing market continue to recover. We anticipate that Fannie and Freddie will release their own guidelines soon, and we will share details with you as soon as they are available.
Wednesday, December 16, 2009
Friday, December 11, 2009
Click here to view “Beyond the Headlines,” a version specifically formatted for consumers that you can print, share via e-mail, or post on your Web site.
Welcome to C.A.R.’s Market Matters, your weekly market response guide.
Los Angeles Times
Shaving real estate commissions can save sellers thousandsAs home values have declined, a recent Los Angeles Times article questioned the compensation a REALTOR® receives for his/her efforts. While REALTORS®’ compensation may be an important factor for sellers to consider, it should not be the deciding factor.
MAKING SENSE OF THE STORY FOR CONSUMERS
Rather than focusing on a REALTOR®’s compensation, consumers instead should focus on identifying and selecting a REALTOR® who best meets their needs and unique situation. The guidance and value a REALTOR® brings to the transaction cannot be determined by his or her commission rate alone. In this instance, the saying “you get what you pay for,” may ring true. Consumers should interview several REALTORS® to identify the best fit for them and their situation.
It’s critical to point out that although there are more than half a million licensed agents, not every real estate agent is a REALTOR® who voluntarily agrees to subscribe to a strict Code of Ethics. As members of their local, state, and national associations of REALTORS®, REALTORS® constantly receive updates on the latest housing legislation impacting them and their clients. Additionally, REALTORS® have access to the latest technologies for the real estate industry, including critical housing data, pricing trends, time on market, and historical sales activity in the neighborhood. These tools and resources enable REALTORS® to provide the highest level of service possible, including helping sellers determine the best price for their home in today’s market.
A REALTOR® also can assist with the critical negotiations included in every real estate transaction, and help both buyers and sellers finalize the many details that comprise a purchase agreement. For sellers, a REALTOR®’s role may include negotiating a sale price and other terms in this tough market. A REALTOR® also can help sellers determine what, if any, repairs may be the owner’s responsibility, and can help negotiate deadlines for their completion.
To read the full story, please click here.
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In Other News
The New York Times
New rules for counselorsOlder homeowners who are considering a reverse mortgage can now get more help in the decision-making process. The Federal Housing Administration, which insures reverse mortgages, last month instituted new standards for the counselors who, according to federal law, must meet with prospective borrowers before a loan can be approved.
To read the full story, please click here.
Los Angeles Times
IRS to outline changes in the home buyer tax credit programIf you’re thinking about applying for the new $6,500 home buyer federal tax credit or the extended $8,000 version, the Internal Revenue Service has just issued its first formal guidelines for you.
To read the full story, please click here.
The Wall Street Journal
House flipping makes a comebackFour years after the collapse of the U.S. housing bubble, flipping homes is back in fashion.
To read the full story, please click here.
San Francisco Chronicle
Less competition in the market over holidaysRecent good news about the housing market has many home buyers wondering whether now is a good time to buy. For example, home sales activity increased 9.4 percent nationally in September, a 26 percent increase from a low point in January, according to the NATIONAL ASSOCIATION OF REALTORS®.
To read the full story, please click here.
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *Do your Clients think of You?Send them one of our cards... and they will.House of Cards Proudly Presents:Holiday & Prospecting Greeting Cards for REALTORS®* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
The Mercury News
Now’s really the time to buy a home, many sayMortgage rates are hovering at historic lows, home prices are just starting to edge up from total collapse, and the government is offering tax breaks to first-time and move-up buyers.
To read the full story, please click here.
Los Angeles Times
Consumer borrowing falls for 9th straight monthThe Federal Reserve says consumers borrowed less for a record ninth straight month in October. It was another sign that consumer spending will remain weak, making it harder for the economy to mount a sustained rebound.
To read the full story, please click here.
Reuters
Quarter in U.S. foreclosure plan late on paymentsMore than one-quarter of homeowners receiving help under a U.S. government foreclosure prevention plan are behind on their new mortgage payments, a Treasury Dept. survey has found.
To read the full story, please click here.
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Talking PointsHere’s what to tell consumers...
Many homeowners have been enticed lately by mortgage interest rates hovering near 5 percent, leading some to think about refinancing their home. The first step owners should take is to have their property’s value assessed and to contact a REALTOR® to find out what similar homes are selling for in the area, as opposed to their listing prices. If there have been a high number of foreclosures in the neighborhood, chances are property values have declined.
Most lenders today will not complete a home loan refinance unless the owner has at least 20 percent equity in the property and proof of income. However, homeowners who are underwater—those who owe more on the mortgage than the home is worth—still may qualify for a home refinance. Some federal programs allow homeowners to refinance their mortgage up to 125 percent of the home’s value.
Some home loans include prepayment penalties, meaning the homeowner has to pay a penalty for paying the loan off earlier than the original loan terms. Prepayment includes refinancing, as the original loan is paid off through the refinance. If the fees are equal or close to the amount the owner would save with a refinance, then refinancing the home may not be the best option.
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *TransUnion SmartMove gives C.A.R.'s independent landlords all thescreening tools they need, with none of the hassle. Click here tocreate an account and get 20% off. Credit, criminal and a leasingrecommendation in minutes. No approval process. No minimums.* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
This message was sent to bmcgarvin@cox.net. Visit your subscription management page to modify your e-mail communication preferences or unsubscribe.
Market Matters is published by the CALIFORNIA ASSOCIATION OF REALTORS®, a trade association representing more than 175,000 REALTORS® statewide. Edited by: Mark Giberson, (markg@car.org) and Mary Burroughs, (maryb@car.org) Executive offices:525 South Virgil Ave., Los Angeles CA 90020phone (213) 739-8200; fax (213) 480-7724 Legislative offices:980 Ninth Street #1430, Sacramento CA 95814phone (916) 492-5200; fax (916) 444-2033 To view C.A.R.'s Privacy Policy click on this link:http://www.car.org/aboutus/privacypolicyTo contact C.A.R., click on this link:http://www.car.org/?view=ContactUs Written inquiries regarding Market Matters should be directed to Mary Burroughs, (maryb@car.org).
Welcome to C.A.R.’s Market Matters, your weekly market response guide.
Los Angeles Times
Shaving real estate commissions can save sellers thousandsAs home values have declined, a recent Los Angeles Times article questioned the compensation a REALTOR® receives for his/her efforts. While REALTORS®’ compensation may be an important factor for sellers to consider, it should not be the deciding factor.
MAKING SENSE OF THE STORY FOR CONSUMERS
Rather than focusing on a REALTOR®’s compensation, consumers instead should focus on identifying and selecting a REALTOR® who best meets their needs and unique situation. The guidance and value a REALTOR® brings to the transaction cannot be determined by his or her commission rate alone. In this instance, the saying “you get what you pay for,” may ring true. Consumers should interview several REALTORS® to identify the best fit for them and their situation.
It’s critical to point out that although there are more than half a million licensed agents, not every real estate agent is a REALTOR® who voluntarily agrees to subscribe to a strict Code of Ethics. As members of their local, state, and national associations of REALTORS®, REALTORS® constantly receive updates on the latest housing legislation impacting them and their clients. Additionally, REALTORS® have access to the latest technologies for the real estate industry, including critical housing data, pricing trends, time on market, and historical sales activity in the neighborhood. These tools and resources enable REALTORS® to provide the highest level of service possible, including helping sellers determine the best price for their home in today’s market.
A REALTOR® also can assist with the critical negotiations included in every real estate transaction, and help both buyers and sellers finalize the many details that comprise a purchase agreement. For sellers, a REALTOR®’s role may include negotiating a sale price and other terms in this tough market. A REALTOR® also can help sellers determine what, if any, repairs may be the owner’s responsibility, and can help negotiate deadlines for their completion.
To read the full story, please click here.
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *FREE Social Media Marketing SystemMaximize business from the leading social networks online!Top Producer’s all-new Market Snapshot systemnow includes a FREE Social Media Marketing System>* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
In Other News
The New York Times
New rules for counselorsOlder homeowners who are considering a reverse mortgage can now get more help in the decision-making process. The Federal Housing Administration, which insures reverse mortgages, last month instituted new standards for the counselors who, according to federal law, must meet with prospective borrowers before a loan can be approved.
To read the full story, please click here.
Los Angeles Times
IRS to outline changes in the home buyer tax credit programIf you’re thinking about applying for the new $6,500 home buyer federal tax credit or the extended $8,000 version, the Internal Revenue Service has just issued its first formal guidelines for you.
To read the full story, please click here.
The Wall Street Journal
House flipping makes a comebackFour years after the collapse of the U.S. housing bubble, flipping homes is back in fashion.
To read the full story, please click here.
San Francisco Chronicle
Less competition in the market over holidaysRecent good news about the housing market has many home buyers wondering whether now is a good time to buy. For example, home sales activity increased 9.4 percent nationally in September, a 26 percent increase from a low point in January, according to the NATIONAL ASSOCIATION OF REALTORS®.
To read the full story, please click here.
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *Do your Clients think of You?Send them one of our cards... and they will.House of Cards Proudly Presents:Holiday & Prospecting Greeting Cards for REALTORS®* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
The Mercury News
Now’s really the time to buy a home, many sayMortgage rates are hovering at historic lows, home prices are just starting to edge up from total collapse, and the government is offering tax breaks to first-time and move-up buyers.
To read the full story, please click here.
Los Angeles Times
Consumer borrowing falls for 9th straight monthThe Federal Reserve says consumers borrowed less for a record ninth straight month in October. It was another sign that consumer spending will remain weak, making it harder for the economy to mount a sustained rebound.
To read the full story, please click here.
Reuters
Quarter in U.S. foreclosure plan late on paymentsMore than one-quarter of homeowners receiving help under a U.S. government foreclosure prevention plan are behind on their new mortgage payments, a Treasury Dept. survey has found.
To read the full story, please click here.
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *Bank of America and C.A.R. team up to bring you theC.A.R. WorldPoints MasterCard® credit card: Enjoy the rewards!Earn points and get the rewards you want with no annual fee. Showthe card that shows you’re a REALTOR®! Click here to learn more!* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
Talking PointsHere’s what to tell consumers...
Many homeowners have been enticed lately by mortgage interest rates hovering near 5 percent, leading some to think about refinancing their home. The first step owners should take is to have their property’s value assessed and to contact a REALTOR® to find out what similar homes are selling for in the area, as opposed to their listing prices. If there have been a high number of foreclosures in the neighborhood, chances are property values have declined.
Most lenders today will not complete a home loan refinance unless the owner has at least 20 percent equity in the property and proof of income. However, homeowners who are underwater—those who owe more on the mortgage than the home is worth—still may qualify for a home refinance. Some federal programs allow homeowners to refinance their mortgage up to 125 percent of the home’s value.
Some home loans include prepayment penalties, meaning the homeowner has to pay a penalty for paying the loan off earlier than the original loan terms. Prepayment includes refinancing, as the original loan is paid off through the refinance. If the fees are equal or close to the amount the owner would save with a refinance, then refinancing the home may not be the best option.
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *TransUnion SmartMove gives C.A.R.'s independent landlords all thescreening tools they need, with none of the hassle. Click here tocreate an account and get 20% off. Credit, criminal and a leasingrecommendation in minutes. No approval process. No minimums.* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
This message was sent to bmcgarvin@cox.net. Visit your subscription management page to modify your e-mail communication preferences or unsubscribe.
Market Matters is published by the CALIFORNIA ASSOCIATION OF REALTORS®, a trade association representing more than 175,000 REALTORS® statewide. Edited by: Mark Giberson, (markg@car.org) and Mary Burroughs, (maryb@car.org) Executive offices:525 South Virgil Ave., Los Angeles CA 90020phone (213) 739-8200; fax (213) 480-7724 Legislative offices:980 Ninth Street #1430, Sacramento CA 95814phone (916) 492-5200; fax (916) 444-2033 To view C.A.R.'s Privacy Policy click on this link:http://www.car.org/aboutus/privacypolicyTo contact C.A.R., click on this link:http://www.car.org/?view=ContactUs Written inquiries regarding Market Matters should be directed to Mary Burroughs, (maryb@car.org).
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