A short sale is the sale of a property that is often listed for less than is owed to the bank. The seller gets agreement from the bank to sell the home at a lower price to avoid foreclosure. This agreement is good for banks and sellers. The bank saves money avoiding foreclosure, because it doesn’t have to pay insurance on the property or any of the upkeep, or realtor fees to get the property re-sold to new owners. Sellers benefit by not having a
foreclosure on their credit report. Buyers may get the biggest benefit of all by getting a home for a deal.

If you choose to go the short sale route, there are a few things to keep in mind.

1. Patience is a virtue.

Short sales are known for being a slower purchasing process, but the wait is usually worth it.

2. The more liens against the home, the harder it is to reach approval.

You already have the task of getting the seller and their bank to agree to your offer. Now, just imagine trying to get a room full of people to agree to your ideas (or deal in this case) as opposed to trying to convince just one or two people.

3. Pick a knowledgeable realtor.

You’re home buying process will be much smoother if you work with a realtor who is very familiar with the ins and outs of short sales.

Buying a short sale isn’t much different than buying a regular home. Once you have bank approval on your offer, the inspection, appraisal, and closing process moves forward just like normal. If you think a short sale might be for you, or you would like some more information call us today. We are experienced with the short sale process and would be happy to answer any questions you may have.

Let’s start with the definition of a HUD home. It is a home offered for sale by the U.S. Department of Housing and Urban Development. They are single family homes that can be up to four units. The homes are usually priced below comparable homes in the neighborhood, so you can often get more bang for your buck by way of more popular neighborhoods, or preferred school districts.

Purchasing a HUD home is a different process than buying a house through other programs. HUD uses a bidding process, and bidding is only open to owner-occupants (people who are going to live in the home) at first. Bids are placed with the help of a registered agent. If the home doesn’t sell, then bidding is opened up to investors. This is great news if you are shopping for a home and don’t want to compete with investors. Some of the available homes also qualify for the “hundred dollar down program,” so you may find a home to buy with fairly small out of pocket expenses. 

If you are interested in a HUD home, be forewarned, many of these houses are not the perfect house, and all properties are sold in as-is condition. You have to keep an open mind when looking at them. A lot of the available homes are going to need some work. Look for a house with good structural “bones.” This can be a great opportunity if you are looking for a property to roll up your sleeves, invest some sweat equity, and make it reflect your personality and personal taste. Most HUD homes are eligible for the 203k program, so you’ll have the funds to make any repairs that may be needed.

If you have questions regarding HUD homes, want more information, or want someone to walk you through the bidding process, give us a call today. We would love to help you achieve your home ownership goals!

The 203K loan is a FHA loan that provides financing for a home that needs to be rehabilitated that traditional banks won’t finance. The home price and cost of fixing the home are rolled into one loan.

How does it work?

A 203K loan helps home owners by making repair costs of a home part of the mortgage payment. The repair part of the loan is put into an escrow account and pays for repairs and contractors.

How is the repair escrow price decided?

The repair escrow of a 203K loan is decided by estimates from contractors. If you have a home that needs plumbing repairs, roofing repairs, electrical repairs, and a dangerous front porch replaced, and contractor (or several!) will come out and give estimates on the required repairs. Those estimates, along with an appraisal help decide how much money is needed for the repair escrow.

Can I do my own repairs?

Yes, but you will still need estimates from contractors to determine the repair escrow. Keep in mind all repairs will have to meet FHA housing requirements, so if you aren’t familiar with home repair, you should probably leave the heavy lifting to the professionals.

Can I get a 203K loan and use the escrow on something besides repairs?

No. The escrow is for the cost of rehabilitating the property only.

Is there a time limit on completing the repairs?

Yes. All repairs must be completed within six months.

Is there a limit to how much money can go into the repair escrow?

Yes. The repair escrow and mortgage cannot be more than the appraised value of the property once it is repaired. If you find a house with an asking price of 50k that, once repaired, would appraise for 90k, then your repair escrow could not be larger than 40k.

Check out this great video for detailed information on how the process works:

What is a FHA 203K loan?

If you think a 203K loan might be for you, give us a call. We will be happy to walk you through the process of securing your dream home!

The steps to
obtaining a CHFA loan are fairly simple. First, you will be required to take a
homebuyer education course. They are available both online and in classes
around the Denver-metro area. The course is free, and helps buyers learn about
all the terminology and steps associated with purchasing real estate.

Next, you’ll
need to find a lender that is familiar with the CHFA loan process to get pre-approved
for a loan. The lender will run your credit report, verify your income, and
decide how much you can afford. They will let you know how much you can spend
and should give you a copy of your pre-approval letter.

Now, here
comes the fun part. Once you are pre-approved, it’s time to find a realtor and
start shopping! It helps to work with a realtor that is well versed with CHFA
loans, so they will be able to help you find the perfect house that falls
within CHFA’s housing requirements.

Once you put
an offer on a house, and it’s accepted, you will follow the same basic steps to
closing the deal on any other type of loan. You’ll get an inspection, finalize
financing, set a closing date, and so on. The biggest bonus of using a CHFA
loan is they will pay up to 3% of the price of the loan, and that money can be
put toward your down payment. You have to contribute at least $1000.00 toward
the home yourself.

After
closing, you will make your monthly mortgage payments to CHFA. The 3% they paid
at closing will have to be paid back to them over the life of the loan. You can
make your mortgage payment several ways: mail in a check, over the phone,
online, automatically deduct the balance from your bank account, or they even
offer biweekly payments.

Overall, the
CHFA loan program is a good choice for lower income families that want to
fulfill their dream of owning a home of their own.

Denver-Aurora-Broomfield, CO Metropolitan Statistical Area

Forecast change: second quarter, 2011 – second quarter, 2012    -4%

Forecast change: second quarter, 2012 – second quarter, 2013
+2.8%

Market fundamentals Median Family Income (2010) $74,000

Median Home Price (Second quarter 2011) $254,000

Change in Home Prices (From second quarter 2010 thru second
quarter 2011) -2.7%

Worst 1-Year Home Price Change (1980-2011) -6.2% (2006:Q1)

Maximum loan amount

$850,000

Maximum LTV/CLTV

89.99%

Minimum Loan Score

720

Qualifying ratio

33% housing ratio and 38% total debt ratio

Co-borrowers

Non-occupant co-borrowers are not allowed

Eligible products

Fixed-rate: 30 year and 15 year; ARMs: 10/1, 7/1 and
5/1

Employment

requirements

Eligible customers must have completed their medical
residency within the most recent 36 months from the application date and be a
practicing medical doctor (verified with a copy of their license.)

Customers with fewer than six months left in their residency
who have accepted a permanent position (verified by a fully executed
employment offer letter) may be eligible:

• Income from the
  permanent position will be used to calculate debt ratios
• Verified post-close
  liquidity must be sufficient to cover Principal, Interest, Taxes and
  Insurance until the residency is completed and the new position is started

Customers who started a fellowship immediately after
their medical residency are eligible for this program if the fellowship was
completed within the most recent 36 months from the application date.

Mortgage Insurance

Not
required

Number of

financed properties

No more than one other financed property

Occupancy and purpose

Purchase only – Primary Residence only

Property types

Allowed: single-family detached, single-family
attached, PUDs and condominiums

The Interest-Only

payment feature

Call or Email us today for more info

Not allowed

303-886-5991

paul@theedgegroup.net

]]> http://theedgegroup.net/great-home-loan-offered-for-doctors-in-the-denver-metro-area/feed/ 0 http://theedgegroup.net/denver-october-2011-real-estate-sales/ http://theedgegroup.net/denver-october-2011-real-estate-sales/#comments Tue, 08 Nov 2011 22:20:16 +0000 Paul Gruber http://theedgegroup.bluefireblogs.com/?p=305 Read More »]]> October residential closings for Metrolist posted an increase of 8.9% over
this time last year. This is the 5th month in a row in which residential
closings showed an increase over the same period last year. Inventory continues
to drop with only 11,504 residential homes on the market, a 30% reduction from
October 2010.

The condo market was very active in October posting a 24.7% increase in
closings versus October of 2010. Inventory continues to drop in the condo
market as well with only 2,652 condos on the market a 45% reduction compared to
this time last year.

October 2011 – Real Estate Market Update

Entire MLS (all areas)

Residential Highlights

• 8.9% Increase in closed sales year over year

• 34% Decrease in Absorption Rate (5.1 months)

• 30.2% Decrease in active listings (11,504)

• 6.1% Decrease in average sold price ($269,503)

Condo/Townhome
Highlights

• 24.7% Increase in closed sales year over year

• 45.7% Decrease in invetory (2,652)

• 1% Increase in average sold price ($160,723)

Public trustees reported 7,233 foreclosure filings in the second quarter with 5,333 sales at auction being completed. Both numbers are down from the same period in 2010, when there were 10,233 filings and 5,887 homes sold, according to the Colorado Division of Housing’s second-quarter foreclosure report.

That’s the state’s second-lowest quarterly total since 2007, according to the report.

Existing-home sales increased in August, even with ongoing tight credit and appraisal problems, along with regional disruptions created by Hurricane Irene, according to the National Association of Realtors®. Monthly gains were seen in all regions.

Total existing-home sales¹, which are completed transactions that include single-family, townhomes, condominiums and co-ops, rose 7.7 percent to a seasonally adjusted annual rate of 5.03 million in August from an upwardly revised 4.67 million in July, and are 18.6 percent higher than the 4.24 million unit level in August 2010.

Lawrence Yun, NAR chief economist, said there are some positive market fundamentals. “Some of the improvement in August may result from sales that were delayed in preceding months, but favorable affordability conditions and rising rents are underlying motivations,” he said. “Investors were more active in absorbing foreclosed properties. In addition to bargain hunting, some investors are in the market to hedge against higher inflation.”

Investors² accounted for 22 percent of purchase activity in August, up from 18 percent in July and 21 percent in August 2010. First-time buyers purchased 32 percent of homes in August, unchanged from July; they were 31 percent in August 2010.

All-cash sales accounted for 29 percent of transactions in August, unchanged from July; they were 28 percent in August 2010; investors account for the bulk of cash purchases.

“We had some disruptions from Hurricane Irene in the closing weekend of August, when many sales normally are finalized, along the Eastern seaboard and in New England,” Yun said. “As a result, the Northeast saw the smallest sales gain in August, and some general impact is expected in September with widespread flooding from Tropical Storm Lee. Aberrations in housing data are possible over the next couple months as markets recover from disrupted closings and storm damage.”

Yun said an extremely important issue currently is the renewal and availability of the National Flood Insurance Program, scheduled to expire at the end of this month. “About one out of 10 homes in this country need flood insurance to get a mortgage, and we would see significant negative market impacts without it,” he said.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 4.27 percent in August, down from 4.55 percent in July; the rate was 4.43 percent in August 2010. Last week, Freddie Mac reported the 30-year fixed rate fell to a record low 4.09 percent.

NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I., said the market is remarkably affordable for people with secure jobs, good credit and long-term plans. “All year, the relationship between home prices, mortgage interest rates and family income has been hovering at historic highs, meaning the best housing affordability conditions in a generation,” he said.

“The biggest factors keeping home sales from a healthy recovery are mortgages being denied to creditworthy buyers, and appraised valuations below the negotiated price. Buyers may be able to find more favorable credit terms with community and small regional banks, and Realtors® can often give buyers advice to help them overcome some of the financing obstacles,” Phipps said.

Contract failures – cancellations caused largely by declined mortgage applications or failures in loan underwriting from appraised values coming in below the negotiated price – were reported by 18 percent of NAR members in August, up from 16 percent July and 9 percent in August 2010.

The national median existing-home price³ for all housing types was $168,300 in August, which is 5.1 percent below August 2010. Distressed homes – foreclosures and short sales typically sold at deep discounts – accounted for 31 percent of sales in August, compared with 29 percent in July and 34 percent in August 2010.

Total housing inventory at the end of August fell 3.0 percent to 3.58 million existing homes available for sale, which represents an 8.5-month supply⁴ at the current sales pace, down from a 9.5-month supply in July.

Single-family home sales rose 8.5 percent to a seasonally adjusted annual rate of 4.47 million in August from 4.12 million in July, and are 20.2 percent above the 3.72 million pace in August 2010. The median existing single-family home price was $168,400 in August, which is 5.4 percent below a year ago.

Existing condominium and co-op sales increased 1.8 percent a seasonally adjusted annual rate of 560,000 in August from 550,000 in July, and are 8.3 percent higher than the 517,000-unit level one year ago. The median existing condo price⁵ was $167,500 in August, down 3.3 percent from August 2010.

Regionally, existing-home sales in the Northeast increased 2.7 percent to an annual pace of 770,000 in August and are 10.0 percent above a year ago. The median price in the Northeast was $244,100, which is 5.1 percent below August 2010.

Existing-home sales in the Midwest rose 3.8 percent in August to a level of 1.09 million and are 26.7 percent above August 2010. The median price in the Midwest was $141,700, down 3.5 percent from a year ago.

In the South, existing-home sales increased 5.4 percent to an annual pace of 1.94 million in August and are 16.9 percent higher than a year ago. The median price in the South was $151,000, which is 0.8 percent below August 2010.

Existing-home sales in the West jumped 18.3 percent to an annual pace of 1.23 million in August and are 20.6 percent higher than August 2010. The median price in the West was $189,400, down 13.0 percent from a year ago.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.