Orlando Real Estate Voice, Short Sale Expert & Specialist

The Federal Housing Administration (FHA) will suspend it’s anti-flipping rule for another year to help continue to speed the sales of some foreclosed homes.
In 2003, the Department of Housing and Urban Development (HUD) issued a rule that prohibited the FHA from insuring a mortgage on homes that were owned by the seller for less than 90 days.
The rule was designed to avoid “flipping” properties — buying and quickly reselling them at inflated prices to unsuspecting borrowers.
That was several years before the housing market crashed and foreclosures flooded the market.
Last February HUD lifted the ban for one year to accelerate investors’ sales of foreclosure properties. Last week, HUD extended the rule wavier for another year, until January 2012.
The housing market needs whatever it can get to speed up foreclosure transactions which can get bogged down by a host of conditions including delays, clean up issues, fix-up problems and fraud.
Without FHA mortgage insurance for a resale within 90 days, sellers balk at FHA buyers because the sellers will have to endure carrying costs along with the risk of vandalism associated with allowing a property to sit vacant for long periods of time.
Today, low-down payment FHA loans account for 30 to 50 percent or more of home purchases, depending on the location.
“With 65 percent of home buyers using FHA loans in the Inland Empire (California), this will continue to encourage investors to purchase, renovate, and re-sell these homes, get them in better condition, and make them eligible for traditional FHA financing,” said Brad Yzermans, a mortgage broker with First Priority Financial.
The extended waiver is also seen as a way to bolster FHA’s reserves, which had fallen well below levels recommended by Congress.
The new policy change will permit buyers to use FHA-insured financing to purchase HUD-owned properties, bank-owned properties, or properties resold through private sales.
To protect FHA borrowers against predatory flipping practices the waiver is limited to sales that meet the following general conditions:
• All transactions must be arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction.
• No pattern of previous flipping can exist for the property.
• In cases in which the sales price of the property is 20 percent or more above the seller’s acquisition cost, the waiver will only apply if the lender meets controlled conditions.
• The waiver is limited to forward mortgages, and does not apply to the Home Equity Conversion Mortgage (HECM) for Purchase program.
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Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of Real Estate in Orlando, Windermere, Winter Garden, Kissimmee, St. Cloud, East Orlando, Longwood, Altamonte Springs, Maitland, Winter Park, Oviedo, Apopka, Lake Mary, Clermont, Ocoee Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area.
Please visit:
Avoid Foreclosure / Short Sale Help http://OrlandoShortSaleExpert.com, or http://ShortSellMyOrlandoHome.com
Our Website http://JerryLaRose.com or www.JerrySellsOrlando.com, or http://OrlandoRealEstateVoice.com ,
If you’re a Buyer looking for Great Deals – http://InvestmentPropertyDealsOrlando.com
Please give me a call if you have questions about the Orlando and Central Florida real estate market.
P.S. If you are listing your home as a short sale in Orange, Seminole, Polk, Lake or Osceola County Florida and Orlando, East Orlando, St. Cloud, Davenport, Clermont, Longwood, Windermere, Winter Garden, Kissimmee, Winter Park, Altamonte Springs, Maitland, Apopka, Lake Mary, Oviedo or Ocoee Florida make sure you hire an agent who knows how to do short sales and has the experience to get the job done. We are doing successful short sale packages. The short sale process is complicated and we can help simplify it.
Call us at 407-580-7011 or email at jerry@JerryLaRose.com to find out more about Orange County Short Sales and Orlando Area Short Sales.

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News You Need to Know for 2009 – FHA Short Sales Easier than Ever!

As if increased minimum wage laws and ultra-low interest rates weren’t good enough, short sale investors will be downright delirious to learn about changes to FHA laws set to begin in 2009. On December 24th, 2008 the Department of Housing and Urban Development (HUD) released “Mortgage Letter 2008-43″… despite the inconspicuous title, this is a powerful boon to every short sale investor in the nation.

For those of you who somehow managed not to be engrossed by this less than climatic title, here are the major changes coming soon to a FHA/HUD foreclosure near you!

1. Elimination of the clause calling for 63 percent or greater property appraisal versus debt. Now properties can appraise at any value and still be eligible for the program.

2. Increased Net. Instead of the former 82 percent net based upon appraisal value the new limits will be 88 percent if sold with 30 days, 86 percent if sold within 60 days and 84 percent thereafter.

3. Increased Closing Costs on Short Sales. Although not a lot – FHA will now allow up to 1 percent of closing costs rather than the former zero.

4. Increased Seller Incentives. Again, although not a lot this will at least allow sellers a reasonable down payment toward a rental home by putting up to $1,000 in their pocket at closing.

5. Increased Lien Allocations. Junior liens up to $2,500 are now allowed – just one more tool that helps sweeten the pot for short sale investors interested in pursuing FHA/HUD homes.

6. Removal of Repair Limitations. This is one change that could potentially add up to thousands depending upon the required maintenance on the home. This opens the doors to many homes that would otherwise be ignored due to excessive damage.

7. Exceptions to Non-Owner Occupant Requirements. This is on a case by case basis but opens to the door to rental properties formerly excluded from the program.

To learn more or read the release for yourself visit:

http://www.brokencredit.com/wp-content/uploads/2008/12/fha-pre-foreclosure-short-sale-guidelines.pdf

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Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of Real Estate in Orlando, Windermere, Winter Garden Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area. Please visit www.JerrySellsOrlando.com for your real estate needs. Please give me a call if you have questions about the Orlando and Central Florida real estate market.

P.S. If you are listing your home as a short sale in Orange County Florida and Orlando, Windermere, Winter Garden, or Ocoee Florida make sure you hire an agent who knows how to do short sales and has the experience to get the job done. We are doing successful short sale packages. Call us at 407-580-7011 to find out more about Orange County Short Sales and Orlando Area Short Sales.

The House Financial Services Committee adopted H.R. 6694, legislation designed to reauthorize and reform down payment assistance programs that the Bush Administration banned in July.

A last-ditch effort to head off the Oct. 1 ban on the use of seller-funded down-payment assistance with FHA-backed loans is picking up steam as a compromise bill that would mend rather than end the practice of down payment assistance.

HR 6694 would allow qualified borrowers with credit scores of 680 or above to use seller-funded down-payment assistance on FHA-backed loans. Borrowers with scores between 620-680 will be subject to risk-based pricing and higher insurance premium fees.

But the bill still needs to be approved by Congress and the President.

Today’s committee vote was a positive step toward preserving down payment assistance, but it’s far from over. Now more than ever, members of Congress need to know that Americans are watching their vote on H.R. 6694.

I encourage everybody who wants to see seller assisted down payment assistance preserved to tell their representatives in the House and the U.S. Senate that a vote for H.R. 6694 is a vote for the next generation of homeowners.