FHA might reintroduce the days of no credit no problem.
FHA May Waive Its 3-Year Foreclosure Waiting Period
Dan Green September 10, 2012
Between 2006-2011, the FHA’s share of the purchase mortgage market increased 5-fold.
For 2012 and beyond, that share should increase.
The FHA is contemplating new, looser mortgage guidelines that would waive its standard “waiting period” after a significant derogatory credit event. Home buyers with recent bankruptcy, foreclosure or short sale may be cleared to buy homes immediately.
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Proprietary OC Housing News home purchase analysis
18211 AVOLINDA Dr Yorba Linda, CA 92886
$479,500 …….. Asking Price
$410,000 ………. Purchase Price
3/11/2009 ………. Purchase Date
$69,500 ………. Gross Gain (Loss)
($32,800) ………… Commissions and Costs at 8%
============================================
$36,700 ………. Net Gain (Loss)
============================================
17.0% ………. Gross Percent Change
9.0% ………. Net Percent Change
4.5% ………… Annual Appreciation
Cost of Home Ownership
——————————————————————————
$479,500 …….. Asking Price
$16,783 ………… 3.5% Down FHA Financing
3.60% …………. Mortgage Interest Rate
30 ……………… Number of Years
$462,718 …….. Mortgage
$120,819 ………. Income Requirement
$2,104 ………… Monthly Mortgage Payment
$416 ………… Property Tax at 1.04%
$0 ………… Mello Roos & Special Taxes
$120 ………… Homeowners Insurance at 0.3%
$482 ………… Private Mortgage Insurance
$0 ………… Homeowners Association Fees
============================================
$3,121 ………. Monthly Cash Outlays
($316) ………. Tax Savings
($716) ………. Equity Hidden in Payment
$20 ………….. Lost Income to Down Payment
$140 ………….. Maintenance and Replacement Reserves
============================================
$2,249 ………. Monthly Cost of Ownership
Cash Acquisition Demands
——————————————————————————
$6,295 ………… Furnishing and Move In at 1% + $1,500
$6,295 ………… Closing Costs at 1% + $1,500
$4,627 ………… Interest Points
$16,783 ………… Down Payment
============================================
$34,000 ………. Total Cash Costs
$34,400 ………. Emergency Cash Reserves
============================================
$68,400 ………. Total Savings Needed
The property above is available for sale on the MLS.
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Cost of Ownership Analysis
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Nearby Foreclosures
Gain a competitive advantage over other buyers. By locating distressed properties -- before they hit the MLS -- you can discover where tomorrow's REOs and short sales will appear. Most of these properties are not listed on the MLS, but they will be soon. Research properties in advance and get a jump on your competition. Don't miss out on another deal because you couldn't act quickly. Use this tool to your advantage! The red properties are already bank owned. As soon as REO asset managers prepare them for sale, they will be on the MLS. Get ready! The green and blue properties have owners who are not paying their mortgages. They may be offered as short sales, or they may go through foreclosure and become REO. Either way, they will also likely be available on the MLS soon. Find your next home! Be prepared to offer on these properties by researching them in advance or risk losing out to buyers who are have done their homework. Start your research today! To find distressed properties, enter your desired location and press search. Scroll through list by pressing "next."Comparative Market Analysis
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$699,000 18771 ORIENTE Dr |
0.58 miles 4 bd / 1 ba 1,718 Sq. Ft. |
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$4,000,000 5216 HIGHLAND Ave |
0.73 miles 3 bd / 1.5 ba 1,684 Sq. Ft. |
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$450,000 17390 BRIARDALE Ln |
0.86 miles 3 bd / 2.5 ba 1,674 Sq. Ft. |
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$400,000 17282 MEADOWVIEW Dr |
0.92 miles 3 bd / 2 ba 1,695 Sq. Ft. |
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$320,000 17591 BUENA VISTA Ave |
1.18 miles 3 bd / 1 ba 1,225 Sq. Ft. |
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$271,600 19640 OLANA Plz |
1.37 miles 3 bd / 2.5 ba 1,410 Sq. Ft. |
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$774,900 6052 SUN VIEW Rd |
1.45 miles 4 bd / 2 ba 1,640 Sq. Ft. |
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$405,900 1332 OMAHA Ave |
1.47 miles 4 bd / 2 ba 1,662 Sq. Ft. |
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$399,900 4931 ROSE Dr |
1.52 miles 3 bd / 2 ba 1,700 Sq. Ft. |
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$469,000 5402 RUTLAND Dr |
1.54 miles 4 bd / 2 ba 1,440 Sq. Ft. |
15.1% of underwater borrowers are delinquent on their mortgages
About 600,000 borrowers rose above negative equity in the second quarter of 2012, CoreLogic reported Wednesday.
According to the company’s analysis, 10.8 million, or 22.3 percent, of residential properties with a mortgage remained underwater for the second quarter of 2012. The second quarter figure is a decrease from the first quarter of this year, when 11.4 million properties, or 23.7 percent, were underwater.
Even though negative equity is said to be a driving factor for default, 84.9 percent of underwater borrowers managed to stay current on their payments.
“The level of negative equity continues to improve with more than 1.3 million households regaining a positive equity position since the beginning of the year,” said Mark Fleming, chief economist for CoreLogic. “Surging home prices this spring and summer, lower levels of inventory, and declining REO sale shares are all contributing to the nascent housing recovery and declining negative equity.”
While 600,000 homes moved into positive territory, 2.3 million borrowers were in a state of near-negative equity since they had less than 5 percent equity in their home. For these borrowers, the scale can tip either way, depending on the direction of home prices.
Anand Nallathambi, president and CEO of CoreLogic, said the expectation is for home prices to continue to trend up in August.
“Were this trend to be sustained we could see significant reductions in the number of borrowers in negative equity by next year,” added Nallathambi.
When combining negative and near-negative equity mortgages, CoreLogic found that 27 percent of all residential properties would be in one of the categories.
In dollar terms, the amount of negative equity decreased quarterly to $689 billion to $691 billion.
The states with the highest percentage of underwater mortgages were Nevada (59 percent), Florida (43 percent), Arizona (40 percent), Georgia (36 percent), and Michigan (33 percent).
Of the 10.8 million underwater mortgages, CoreLogic found that 6.6 million are without a home equity loan and the average amount in which they are underwater is $51,000. About 4.2 million underwater borrowers have first and second liens and on average, they are underwater by $84,000.
The report also stated that homes valued at less than $200,000 had a negative equity share of 32 percent compared to 17 percent for homes valued more than $200,000.
It was reported yesterday that incomes are back to 1995 levels. House prices are going nowhere but down.
I saw that too. Without rising incomes, even the fed’s lowering of interest rates won’t keep housing afloat forever.
Can you imagine the demand it will create in parts of Southern California if FHA allows people who foreclosed, short sale, or declared BK to qualify and buy sooner than what the current waiting periods allow for?
And how many more strategic defaults will that cause? Lets see, dump the $375,000 mortgage, rent 1 year, and go buy same or bigger house with only 3.5% to 5% down and have a mortgage of maybe $250,000 with a lower rate.
If FHA reduces the waiting periods for FHA borrowers in the Inland Empire (Riverside and San Bernardino County), there will be people coming out of the woodwork to get qualified with all the foreclosures we experienced out here.
I better staff up and get ready to get these future borrowers approved.