Monday, December 28, 2009

Ten Reasons for Buyer Caution when Buying Foreclosures

  • Some things to look out for and pay attention too when buying foreclosures. The cheap price of the foreclosures had better be worth the costs of repairs, as well as your time and inconvenience. Here is a neat little checklist put together by a professional cleaning and restoration specialist. It offers some good advise when finding or buying foreclosure homes, or any other property in bad shape.

    Foreclosures: Ten Reasons for Buyer Caution
    Foreclosed homes aren’t always the best deal in town – even if they do come with a price tag that appears to be lower than some other homes in the neighborhood.Here are 10 reasons why that is true, offered by Vince Mastronardi, president of On-Site Specialty Cleaning & Restoration in suburban Detroit.
    • No heat in the winter. When a home has been left unheated, buyers run a risk of damaged pipes.
    • Not removed but ripped. Thieves and even angry former owners can do a lot of damage when they depart with fixtures and key systems like heaters and air conditioners.
    • Peeling, bubbling, and discoloration. Water incursion isn’t always obvious, but these are signs.
    • Mold. Where there is water there is mold. Look inside cabinets, behind drawers, and around built-ins.
    • Blocked drains and pipes. Sewer backups can be expensive to fix.
    • Black cobwebs. This is the result of a malfunctioning furnace, common in properties where there hasn’t been maintenance for a long time.
    • Homemade and handy. Where renovations don’t look professional, check with the municipal authority. They may have been completed without permits and that could mean they have to be redone.
    • Fresh paint everywhere. What is the seller covering up?
    • Check the basement. Look for discolored subflooring, which can point to mold. And search for asbestos, common in older homes that haven’t been brought up to code.
    • Air quality. Include air and surface testing in a home inspection. It’s a few hundred dollars well spent.

Thursday, December 10, 2009

U.S. Foreclosures to Reach 3.9 Million in Second Record Year - Bloomberg.com


US Foreclosures won't peak until after Unemployment does. This is pretty scary because the economic data seems to be indicating that the peak of Unemployment isn't any time soon.

The areas most affected by foreclosures continue to be those that had the most boom. Nevada, California, Florida, and Arizona, but areas like Michigan, and Utah are starting to see substantially higher foreclosure rates as well.

Government Steps in With new Short Sale Guidelines

  • "There is a huge problem in our country with short sales. In Utah, as well as nationally. Because of the housing boom, prices were over inflated. Now, many homeowners owe more on their house than they are worth. These people are generally not good savers anyways, and so have no way to sell their homes unless someone pays the difference. Government is once again, stepping in with some assistance, finding ways to reward the irresponsible: The U.S. Treasury Department announced new guidelines this week designed to make short sales go more smoothly. To qualify under these new guidelines: * The property must be the home owner’s principal residence. * The home owner must be delinquent on the mortgage or close to defaulting. * The loan must have been made before Jan. 1, 2009, and be for less than $729,750. * The borrowers’ total monthly mortgage payment must exceed 31 percent of their before-tax income. Under the plan, borrowers will receive $1,500 from the government for selling homes for less than the amount of their mortgages. Mortgage-servicing companies will get $1,000 for each completed short sale. Second-mortgage holders can receive up to $3,000 of the sales proceeds in exchange for releasing their liens. Investors who hold the first mortgage can collect up to $1,000 from the government for allowing the payments. Borrowers who complete a short sale under the program must be “fully released” from future liability for the debt, according to the guidelines."

    tags: short sale guidelines, short sales


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