Updates

Sarasota Real Estate Market Remains Stable

By | September 22, 2011

The Sarasota Association of Realtors reports that “a steady drop in property inventory for sale, combined with a stable sales demand in the Sarasota real estate market, is pointing toward normal, healthy property appreciation in the coming months.”

 

To view the full report with market statistics click here.

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Market Survey Shows Falling Mortgage Rates

By | September 15, 2011

For the second time in as many weeks, the rate on the 30-year fixed rate mortgage, the most common type of mortgage in the United States, has hit record lows according to Freddie Mac’s Primary Mortgage Market Survey.

The average contract rate on a 30-year FRM fell to 4.09%, down from 4.12% the week prior. The average rate on a 15-year fixed rate mortgage fell from 3.33% to 3.30%, while 5/1 ARMs rose slightly, from 2.96% to 2.99%. One-year ARMs dropped from 2.84% to 2.81%.

Mortgage rates have been falling as a result of rallies in the treasury and mortgage-backed securities market. These rallies were spurred by poor economic data in the United States and the possibility of an economic conflagration in Europe prompted by a possible Greek default. The possibility (or maybe even inevitability) of a Greek default would damage the major Euro-banks, which have huge exposure to Greece.

If you’ve been thinking about purchasing a new home or refinancing your current mortgage, now could be the time to do so. Fairway Funding Group has some of the lowest rates in the mortgage industry, consistently beating the national average. To find out more about our products and low rates, call us today at 941-993-8086.

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Ten Tax Tips for Individuals Selling Their Home

By | August 23, 2011

The IRS recently released a publication titled “Ten Tax Tips for Individuals Selling Their Home”.

If you are thinking about selling your home, this is some good information directly from the IRS concerning the gain or loss on the sale, first-time homebuyer credit and change of address.

To view the publication please visit: http://www.irs.gov/newsroom/article/0,,id=243682,00.html

 

 

 

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Foreclosure and Short Sale Alternatives

By | April 27, 2010

There are several options you can pursue when you’re behind on your mortgage and you want to stay in the house. An attorney can help you work through most of these solutions.

Reinstatement – If the reason you’ve missed your payments was temporary and you’re now able to continue paying your mortgage, you may be able to reinstate your mortgage. You’ll probably have to pay all missed fees, late fees, and legal fees due up to the date that you reinstate.

Forebearance If you’d like to reinstate your mortgage but the one-time payment is too high, there is a chance that the lender will allow you to negotiate a repayment plan, or forbearance. The lender will allow you to pay your debt over a specific period of time or will tack the extra debt onto the end of the mortgage.

Rent The PropertyIn some cases a homeowner will have payments low enough to allow him/her to rent the property and pay the excess mortgage payment out-of-pocket.

Refinance – If you have sufficent equity and income, and your credit hasn’t taken too large a hit, you may be able to refinance to a lower rate or better terms – or get enough cash out to cover payments for a while.

Mortgage Modification – In cases where homeowners do have the means to afford their payments, or a payment close to their payment, lenders may qualify the borrower for a mortgage modification.

Short-Refi – The relatively new phenomenon shows just how far some morgage companies are willing to go to avoid foreclosing on properties. This process involves the refinance of a home with reduction in the principal balance and often the interest rate as well. While relatively rare, and attorney can help you negotiate a short-refi.

Deed-in-Lieu – Often called a “friendly foreclosure,” deed-in-lieu occurs when the homeowner gives his deed back to the bank. In exchange for a non-contested repossession the banks will often give up the right to a deficiency judgement; however, in most cases a short sale is more beneficial to the homeowner.  It is still a form of foreclosure and will affect your credit as such.

Bankruptcy – Bankruptcy may allow the homeowner to reorganize his debt and keep his property. An attorney can help you with a bankruptcy.

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Buying Short Sales Vs. Foreclosures

By | April 22, 2010

It’s an interesting market, to say the least.  A simple internet search will turn up tons of listings that are tagged with ‘foreclosure’ or ‘short sale’ (incidentally, if you’re interested in foreclosure listings, you can sign up here for free Sarasota foreclosure lists delivered right to your e-mail.)  Some of the prices look too good to be true; some of them are.  Here’s a quick comparison of short sale vs. foreclosure transactions.

Short Sales Foreclosures

Making the offer

Short Sales

The beautiful thing about short sale contracts is that they’re fair and straightforward.  Short sales, for all their special needs, are regular transactions – a private buyer purchases a property from a private seller, and the funds from the transaction pay off the remaining mortgage.

The problem is that there aren’t enough funds at closing to pay off the entire mortgage – so the bank needs to release their lien.  This can take some time. Sometimes, it can take a lot of time.

Foreclosures

Some Local Foreclosures

[idx-listings linkid=”60978″ count=”5″]

… And Some Local Short Sales

[idx-listings linkid=”80840″ count=”5″]

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How To Buy A Short Sale – Writing the Offer

By | April 19, 2010

How To Make An Offer On A Short Sale

So you’ve driven around the block a few times, checked out the neighborhood and the schools, done your homework, checked it twice – and you’re ready to make an offer on a short sale.

Here are some simple rules to follow:

Don’t be afraid to ask for a good price, but don’t make a lowball offer.

Banks are a lot of things, but they’re not stupid – and they’re good at math.  If they’ll make more money via foreclosure or letting the house sit on the market a little longer, they will not be afraid to tell you to jump in a lake.

Many banks have standing rules for their negotiators to dismiss offers that are significantly under fair-market value.  That said, it can take months for a bank to figure out what a property is worth on the open market.  Just because you’re able to get a contract signed by the seller (who’s not making any money on the deal in the first place) at an ultra-low price doesn’t mean the bank has to accept it.  They are even likely to counter higher than the list price if they determine it was improperly priced in the first place.

In a depreciating market, it’s important to think ahead.  If you’ve got a house that’s worth $200,000 today, and you think it will be worth $193,000 in six months, then by all means ask for $193,000 – but asking for $165,000 might be a little steep.

Write the contract ‘as-is with right to inspect’.

All short sale contracts need to be as-is.  That means that neither the seller nor the bank will be required to make any repairs to the property, but you have the full ability to inspect the property and cancel the contract if the property needs more work than you anticipated.  See a leaky roof?  Incorporate the cost to repair (NOT replace) into your offer price before it’s sent to the bank in the first place.  Don’t expect the seller to fix anything.

Make sure you leave lots of time for the bank to respond.

I hear the same things from buyers every week:

“I don’t understand what’s taking the bank so long.”

“Don’t they know they’re losing money every day this house is on the market?!?”

“Just call them every day until they HAVE to do something!”

Fact is, banks do know that the faster they respond the more money they’ll make, they do know that buyers are likely to walk away and buy something else if they dally – and they do know that they’re going to make damn sure they’re not able to recuperate more money from the seller or that a short sale is the last, best option on the table before they approve it.  They’re already losing hundreds of thousands of dollars on many of these properties.

Also, there are lots of people who have to approve short sale payoffs – although you make your offer to the servicing or originating bank, that bank probably sold off the mortgage long before the loan went into default.  In lots of cases there are second mortgages that need to be paid off in order to release the lien.  In many cases, people who aren’t paying their mortgages also aren’t paying their taxes or homeowner’s association dues.  These are all parties that need to be willing to sign on the dotted line.  It’s not going to happen in two weeks. In most cases, these aren’t things that are going to happen in two months.

Be flexible.

Above all, be flexible.  Banks will totally ignore your timeframes.  They’ll dismiss crazy contract clauses.  They’ll reduce closing costs and commissions.  They’ll nickel and dime you.  Be prepared to go the extra mile in order to get your deal closed.  It’ll be worth it.

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