FHA Loan

In foreclosure news, San Jose banks must offer foreclosure alternatives quickly to help you keep your property in California. If you’re already behind on your mortgage, or waiting for months just to hear back from the bank to find out if their willing to modify your loan, Fannie Mae and Freddie Mac are gonna start to lay the smack down on your bank. Starting January 1st, if you are more than 30 days late on your payment, your bank will be required to send you a packet in the mail offering you alternative options to foreclosure. When you let them know which option you want to take, they’ll have just 30 days to evaluate you as a borrower to see if you refinance or modify your loan. Then they will decide which course of action they think is the best alternative for you. Now this doesn’t mean that they HAVE to make sure you are approved for a modification or principal reduction, it just means they can’t keep you hanging on waiting for an answer. If they do, they’ll be hit with a $500 fine for not getting back to you. Now, with the average underwater homeowner being upside down about $65k on their home already, a $500 fine to the banks will just be a drop in the ocean of their bigger problems.

The rates are too high. They take too much time. My Realtor says that product sucks.

No, No and No. FHA 203K along with it’s conventional renovation cousins; Fannie Mae HomePath and HomeStyle are leading a renaissance in today’s mortgage and real estate market. Buyers (and the smart Realtors) are learning and appreciating the huge value these renovation loan products are adding to our foreclosure driven real estate market.

How are they doing it? What’s the big deal?

You’ll see. Follow along with these 10 simple ways Renovation Loans can help you (and your neighbors TOO)  benefit from the foreclosure driven real estate market!

1.) Opening the Pool of Potential Homes

Are you an FHA buyer? No doubt you are seeing homes listed as “CASH ONLY”  for the offer. With a FHA 203K Renovation Loan you can finance the purchase of a home that was previously only available to CASH buyers.

2.) Easier Neighborhood Selection

Want to live in that ONE particular NEIGHBORHOOD, but can’t AFFORD to live there AND get the house you want? You can NOW! Buy the cheapest house on the block, renovate it yourself (rather than paying an investor a 20% profit) and enjoy.

3.) Less Deferred Maintenance Post-Close

Stuff breaks, especially if that stuff was used when you bought it (I’m talking to you 15 year old HVAC). The average homeowner spends $7,000 – $20,000 in the 1st 18 months of ownership. Why? Because stuff breaks. Replace that tired AC & that water guzzling H2O heater UPFRONT as part of the loan and you can avoid the huge repair bills later.

4.) Maximize a Property’s Potential

Renovation Loans are based on AFTER REPAIR VALUE. Basing the loan on what the house will be worth once the renovations are complete allows for more room to RENOVATE and unleash the homes potential.

5.) Renovate GREEN, Save MONEY

If you are going to upgrade, repair and replace why not make the renovations as ENERGY EFFICIENT as possible? You’ll save MONEY every single month you own the home. GREEN / Energy Efficient homes also have a better resale value.

6.) Get a House in the right SCHOOL ZONE

For the parents out here getting their kids in the right school zone is one of, if not the, most important factor in their house hunt. With the ability to shop for fixer-upper and renovate it yourself you can AFFORD MORE home. The home price BARRIERS are lowered for some of the best and typically most expensive neighborhoods (hint, the ones with the best schools).

7.) Improve the WHOLE Neighborhood

When you RENOVATE a home it has an affect on not only that home, but the homes that surround that home. Come one, do your neighbors a favor already.

9.) Allows MORE Seller’s to SELL

Selling, but don’t have the money to fix your home up first? Small items can cause homes to NOT be eligible for traditional FHA financing.  That eliminates HUGE pools of potential buyers. Market the home with a RENOVATION LOAN and let the buyer do the repairs they way they want.

10.) Making the Mortgage Interest Tax Deduction Work for You

When you wrap your renovations up in your mortgage you increase your mortgage interest tax deduction. If you pay for the renovations later on a credit card not only do you NOT get any TAX BENEFIT, you also pay higher interest rates. Lower rates and a tax deduction sounds like a solid to me.

Those are just 10 of the myriad of ways renovation loans provide value. There are many, many more reasons why the savvy home buyer knows FHA 203K, Fannie Mae HomePath & HomeStyle Renovation loans are some of the BEST products on the market!

Wanna know more? Easy, visit our RENOVATION ADVISOR, spent 2 minutes completing the form and go have lunch (or dinner or afternoon snack). We’ll be with you shortly for a full consultation.

The Wake Up Call show on KPNW with Robb Holloway and Bill Lundun recently interviewed me about foreclosures and foreclosure prevention and the effect on the Lane County Real Estate Market.

For those that didn’t hear the interview and would like to, here is a link to the program. One of the things we discussed are a couple of the resources out there to help people that are in danger of losing their home. One of them is NEDCO, the Neighborhood Economic Development Corporation, located in downtown Springfield.

They offer foreclosure counseling and also home buyer classes, the ABC’s of Home Buying. The other was the State of Oregon Department of Finance and Corporate Securities. They have an excellent publication called “Foreclosure, You can avoid it.” Just follow that link and you can read it.

I am here to assist people qualify for a home. Even after a foreclosure, it will eventually be possible to again become a home owner. Take this link to a post that explains the time limits. I will spend the time necessary to get you to the point where you can purchase a home, if that is the right thing for you. So, even though there are a lot of foreclosures out there, that means there are also a lot of opportunities out there to purchase. Call me today and let’s get started with your new home.