Return to Home Ownership, a work shop for people that have lost their home

For those that have lost their home because of bankruptcy, foreclosure, short sale or other financial event, a Return to Home Ownership is easier than many of them may think.

The “Return to Home Ownership” no obligation, no pressure, educational workshop will help people that have lost their home to bankruptcy, foreclosure, short sale and other derogatory credit events to create a path to buying a home.  The date and time for this no cost event is May 19, 2015 at 7:00 to 8:00 pm.  It is being held at the offices of Real Estate One, 26236 Woodward Avenue, Royal Oak, Michigan.

Home ownership is one of life’s biggest dreams.  It can be a deeply satisfying experience.  It provides a sense of security and control over the lives of the owners and their families.  It also provides both a tax deduction for the mortgage interest and property taxes as well as a return on investment over the long term that out performs most other safe investments.

Many people in the last housing downturn and slow economy lost their homes.  Foreclosure, short sale, bankruptcy and many other events forced them to leave their cherished home.  Job loss and other credit issues also placed pressure on the family resources forcing them to sell their home.  Now, they are renting and not taking advantage of all the benefits of home ownership.

For someone that lost a home, they may think that it is impossible to overcome the loss and Return to Home Ownership.  But, not only isn’t it true, recovery is much easier than most people think.

The “Return to Home Ownership” no obligation, no pressure, educational workshop will provide the information and tools needed to create a path to home ownership.  It will address:

How long to wait before applying for a new mortgage;

The steps to applying for a mortgage;

Documents needed for a mortgage application;

The home buying process;

Insurance issues; and,

Closing process.

This no pressure, no obligation, free educational workshop is coordinated by Morris Hagerman, Realtor for Real Estate One and other home buying services offered by the Real Estate One Family of Companies.

For more information contact:

Morris Hagerman, Realtor

Real Estate One, 26236 Woodward, Royal Oak, Michigan  48067

248-854-8440

morrishagermanproperties@gmail.com

www.morrishagermanproperties.com

Morris Hagerman is a local real estate agent with Real Estate One in Royal Oak, Michigan.  He serves Berkley and the other Woodward 5 communities in southeast Oakland County. The Woodward 5 communities are Berkley, Ferndale, Huntington Woods, Pleasant Ridge and Royal Oak.  He is a resident of Berkley and member of the Berkley Chamber of Commerce.

Full List of presenters:

Real Estate One:      Morris Hagerman      248-854-8440

John Adams Mortgage: Mark Sera               248-760-0288

Insurance One:        Leah Wood              248-864-3292

Capital Title:            Debra Paone            248-414-1255

Short sale as an alternative to foreclosure

Short sales can have a major impact on average sale price for homes in a market.  For many years, short sales were as high as 30% of all homes sold for some markets in southeast Michigan.  Homes sold through a short sale can sell for much less than the market value of similar homes in the community.  At the same time, short sales tamp down the average sale price of all homes.  This makes for a cycle of downward trends in a market if it continues.

A short sale requires that the homeowner realize they are at risk of losing their home and take action to prevent foreclosure.  While lenders abhor short sales, it is the lessor of the two evils. So, not only do they often provide for it in the mortgage contract, depending on the circumstances of the short sale, they will offer the homeowner a bonus for maintaining the home in salable condition at closing.

A short sale in real estate is a home that is sold for less than the value of the mortgages and subordinate liens on the property.  That is, a sale that is short of the funds needed to pay off the balances owed.  

In some cases, a seller brings money to the closing table to make up the difference. In other cases, the seller will rely on the lien holder to accept less than what is due.  When the lien holder accepts a short sale, it doesn’t mean the debt is forgiven.  A lien holder can request the seller to sign a promissory note and take action to collect the debt.  Lien holders, in other cases, do accept the lesser amounts releasing the seller from their obligation. It is important to note here that there can be a tax obligation on the "phantom income" that the cancellation of the debt creates.  Some of it depends on outcome in congress of the extension of the "Mortgage Forgiveness Debt Relief Act of 2007."

In most cases, the short sale process is more complicated than this, but for this definition, it has been kept simple.

For the homeowner, a short sale is a better alternative to foreclosure.  Of all credit problems, including short sales and bankruptcies, a foreclosure is deemed the most troublesome credit issue by mortgage lenders.  So, by the homeowner taking action to get the home approved for short sale and move through the process to its close, the reward will be less damage to their credit rating.  In fact, in as little as three years, many lenders will approve a mortgage for an individual with a short sale in their history, provided they have a clean record since.

Morris Hagerman is a local real estate agent with Real Estate One in Royal Oak, Michigan.  He serves Berkley and the other Woodward 5 communities, including Ferndale, Pleasant Ridge, Royal Oak and Huntington Woods.  Hagerman is also a member of the Berkley/Huntington Woods Area Chamber of Commerce.  You can contact him by phone at 248-854-8440, email at morrishagermanproperties@gmail.com or visit his web page.

FHA changes rules on bankruptcy and foreclosure

The Federal Housing Administration (FHA) recently enacted a rule change allowing borrowers who have fallen into foreclosure, bankruptcy, or a short sale to become eligible for a brand new mortgage backed by the FHA in as little as one year from the date of their previous foreclosure, the date of closing on a short sale, or the discharge date on a bankruptcy.

Considering the previous waiting period for a government-backed mortgage was three years, this new program is great news for buyers who had all but accepted the reality of becoming renters for the foreseeable future.

Effective Date - The program is effective for case numbers assigned on or after August 15, 2013 through September 30, 2016.

Requirements - In order to qualify for the reduced waiting period, buyers must provide proof of suffering an economic event that caused them to fall into financial instability. Examples of such an economic event include: a loss of job; a 20 percent or greater reduction in income for six or more month; a death of a wage earner; or a serious medical issue.

Furthermore, buyers must also provide documentation of a clean financial record for the past 12 months and show their ability to make the payments on their newly proposed mortgage. The buyer is also required to complete a course on housing counseling.

FHA Back to Work – Question & Answers

• How do I apply for the program?

You can apply for an FHA Back to Work - Extenuating Circumstances mortgage with any FHA-approved lender. The mortgage approval process is the same for any other FHA-insured mortgage. 

• What are the minimum eligibility requirements of the FHA Back to Work program?

In order to qualify, you must meet several minimum eligibility standards. The first is that you must have experienced an "economic event" (e.g.; pre-foreclosure sale, short sale, deed-in-lieu, foreclosure, Chapter 7 bankruptcy, Chapter 13 bankruptcy, loan modification, forbearance agreement). The second is that you must demonstrate a full recovery from the event. And, third, you must agree to complete housing counseling prior to closing. You must also show that your household income declined by 20% or more for a period of at least 6 months, which coincided with the above "economic event".

• What are mortgage rates for the FHA Back to Work program?

Mortgage rates are the same as mortgage rates for any other FHA loan. There is no premium on your interest rate, nor are there additional fees to pay at closing. Your mortgage rate will be unaffected by the FHA Back to Work program.

Morris Hagerman is a local real estate agent with Real Estate One in Royal Oak, Michigan.  He serves Berkley and the other Woodward 5 communities, including Ferndale, Pleasant Ridge, Royal Oak and Huntington Woods.  Hagerman is also a member of the Berkley/Huntington Woods Area Chamber of Commerce.  You can contact him by phone at 248-854-8440, email at morrishagermanproperties@gmail.com or visit his web page.