Having Been Able To Purchase Your Dream Home Was One Of The Best Things That Could Happen To You. Now You Have Fallen On Hard Times And Is About To Lose Your Dream Home....You Need Some Help. Call Your Lender, Get In Touch With The Loss Mitigation Department.
How can Loss Mitigation Consultant Assist You?
What Happens When You Miss Your Mortgage Payment? The servicer can foreclose on your property. If this happens, you must move out of your home and the property will be sold. In addition to losing your home, you may/may not owe deficiency balance, which is the difference between the price the servicer sells your home for and the balance on your mortgage loan.
What Should You Do To Avoid Losing Your Home?
Read all correspondence and letters from your lender.
Contact your servicer and explain your situation - you might be surprise as to what they can do for you.
Talk to a Loss Mitigation Consultant (LMC) -
They are willing to help you evaluate your financial situation;
Identify problems and solutions;
Explore your alternatives to foreclosure;
What Steps Can You Take Now To Preserve Homeownership? Take Actions Now...
What are Some of Your Options?
Special Foreberance - If you have recently experienced an unexpected change in income or expenses, you may qualify for a special forberance. Your servicer can arrange a repayment plan based on your individual financial situation.
Mortgage Modification / Partial Claim:
If your income continues at a reduced level, you may qualify for a mortgage modification.
Pre-sale/Short-Sale - If you don't have the ability to reinstate or refinance your loan, your servicer may allow you time to sell your home without going through foreclosure.
Deed-in-lieu of foreclosure:
Your last option to avoid foreclosure is to voluntarily give your home back to the servicer.
Selling a Home
As far as material things are concern, your home is amongst your most valuable asset. That is why when you decide to sell your home it is very important to be sure that you have all of the information you need to make the right decision.
This Guide provides answers to some basic questions which should come up when you decide to sell your home. However, it is not designed as a substitute for the services of a licensed real estate broker and an attorney who handles real estate matters. Don't be "penny wise and pound-foolish." A lot is at stake when you sell your home. It is not simply a matter of finding a buyer. Legal documents describing the responsibilities of the buyer and the seller must be prepared. State and local laws and rules must be satisfied. Some people may be knowledgeable enough to handle these details on their own, but most of us need help.
Selecting a real estate agent or broker
Most people hire a real estate agent to find a buyer and guide them through the sale process. If this is your choice, make certain that you hire an agent who is reputable and is licensed in your state as a real estate broker. If you need help in finding one, contact Netta Blackwood at 407-334-5391. She can help you find a Realtor regardless of where you are living. It is best to interview several agents before hiring one. In addition to talking about the amount of the commission and length of the agreement, ask about how much they think you should ask for your home, and what, if anything, you might need to do to improve the appearance of the property. A good broker will want all the information about your taxes, utility costs and other maintenance issues. Failure to disclose defects in the structure of the home which you know about but would not be obvious to a buyer, or covering up a defect, could result in a lawsuit against you when the buyer discovers the problem. You should not hide such problems from the agent. The agent will require you to sign a "listing agreement." This is a contract describing what the agent is supposed to do and what you must do. Consider the following:
How long is the term?
Most brokers will want an "exclusive" listing for a period of time, such as 6 months or a year. Exclusive means that you cannot deal with another agent during the term of the contract. The length of time is negotiable. Try to get a shorter period, perhaps 2 or 3 months to allow more flexibility to fire the broker if you are dissatisfied. Even if you find your own buyer during the period that the sales agreement is in effect, you will be responsible to pay the commission.
How much is the commission?
Brokers are paid a percentage of the sale price of the home. These amounts can vary widely in different areas, and they are also negotiable. Most brokers participate in multi-list plans where your home is included on a list available to many agents. They commonly share the commissions, that is, the agent you list with will pay another agent who finds the buyer a portion of the commission. This does not affect the total amount you pay. Commissions are deducted from the amount you receive for your home at the final settlement (closing) of the sale. You do not pay commissions in advance.
What if I don't want to use a broker?
Maybe you have a buyer, or your home is in a "hot" area and you think you can find one yourself. It is essential to consult an attorney before showing your home to a prospective buyer. You will need to have important information on issues such as disclosure of defects, anti-discrimination laws, and zoning provisions. Ignorance of these as well as other matters could result in a costly mistake. And, most important, what happens when a buyer says, "I'll take it!" A lot more than just accepting a check and signing over a deed is involved.
Agreement of Sale
The Agreement of Sale is the most important document in a real estate sale. This is the contract that specifies all of the terms of the deal. If you are using one, the agent will prepare and present the agreement to you after you have decided to accept an offer. It is wise to have an attorney review the agreement before you sign. Even though your broker represents you as the seller and the party paying the commission, you should never forget that brokers make their living selling real estate and have an interest in selling as many properties as they can as fast as they can. Your attorney has no independent interest, and will be able to advise you if there is a problem with the agreement before you sign it.
If you are not using a broker, it is very important to have your attorney prepare the agreement. In addition to the names of the parties, a description of the property (taken from the deed) and the sale price, many other provisions are contained in the agreement of sale. A few standard ones are:
How much is the deposit or "earnest money"?
What other items, such as appliances, window treatments or lighting fixtures are included?
What inspections will be necessary, e.g. roof, wiring, plumbing, termites, etc.?
Who pays the cost of needed repairs if the inspection turns up problems?
What if the buyer can't get a mortgage?
What if you want to back out?
Who pays the costs of any state or local deed transfer taxes or fees?
Additional provisions may have to be added if the home is a condominium or located in a planned community with special rules and restrictions. Other provisions may need to be added to meet specific needs of one or both parties. It is easy to make a mistake or leave out crucial information when trying to prepare the agreement on your own, even if you use a pre-printed form. The failure to have all of the details spelled out in the agreement of sale often leads to serious problems which can cause delays and lead to extra expenses before the sale can be closed.
Closing the deal
The "closing" is the formal proceeding where you sign over the deed to the buyer and receive your check for the sale. The information provided above should make it clear that the legal details of selling a home can be complicated. A closing can be quite confusing. There are details such as allocating each party's portion of expenses such as real estate taxes or water and sewer assessments. These issues can vary depending on location, but problems can and often do arise at the closing.
Do I need any attorney to represent me?
If that happens, it is best to have an attorney present to advise you. Otherwise, you risk being pushed to make a decision or to accept some compromise you may not fully understand. Even if you have an agent, (s)he might be influenced by the desire to get the deal closed. There is too much involved, financially, and sometimes emotionally, to risk proceeding without having an attorney at every critical stage of the sale, including the closing.
Do I have to pay taxes on the money I receive for my home?
Under the current law, you do not have to pay federal taxes unless the gain on your home is over $250,000 ($500,000 for spouses). Gain is determined by adding the price you paid when you bought your home to the costs of any major (capital) improvements and subtracting the sum from the amount you received for your property. You can subtract the cost of the sale, including agent's fees and legal fees as well. Major capital improvements mean additions or replacements as opposed to repairs or maintenance. You also must have used the home as a residence for at least two of the five years before the sale. State and local taxes vary substantially. Your real estate agent or attorney will be able to advise you specifically.
Note: While we strive to keep this legal information up to date, the law is constantly changing, and we do not guarantee the accuracy of any information contained herein. Source AARP
Shopping for your dream house?
It’s important to keep insurance in mind throughout the home buying process. Most lenders won’t provide a mortgage without insurance coverage. Your insurance company or agent, together with your realtor, can help you get what you want – a good home that is properly protected.
|EVEN BEFORE YOU START LOOKING FOR A HOME |
Put yourself in the best possible position to be able to afford a home, receive the lowest possible mortgage rate and get insurance for your new house. This takes advance preparation on your part.
Check your credit rating
Good credit helps you in many ways, including getting a mortgage at a good rate. Depending on the state and the insurer, it may also help you save money on your homeowners insurance. Get a copy of one or all of your credit reports. Make sure they are accurate and report any mistakes immediately. The credit report helps you see how your credit standing compares to others. If your credit is not as good as it should be, begin to improve it immediately.
|Check your home insurance claims-filing history|
Get a copy of your loss history report, such as a CLUE report from ChoicePoint or an A-PLUS report from ISO. This is a record of home insurance claims you have filed. If you have not filed any insurance claims in the past five years, you will not have a loss history report. The better your claim record, the less you may pay for insurance. A good claims record can also be important if you are selling the home you are currently living in. However, a past claim does not have to be a problem; the reulting repairs or improvements, if done properly, can make a property more attractive to buyers and insurers.
If you are currently renting, it’s important to have insurance for your personal property. Your landlord’s coverage will not cover the things you own. If you haven’t owned a home before, it might be helpful to have a history of insurance when you go to buy your first home.
As you look at homes, remember that characteristics of the house (where it is, how it's constructed and the kind of shape it’s in) can send your insurance rates up or down.
Construction of the house
If you plan to live near the Atlantic or Gulf coasts, consider a brick home because it is more resistant to hurricanes. If you are buying in a seismically active region, look for newer homes built to current codes, or older homes that have been bolted to their foundations. They are better able to withstand earthquakes.
|Age of the house|
Older homes sometimes have features such as plaster walls, ceiling molding and wooden floors that could be costly to replace. Such special features may raise the cost of insurance. Also, an older home that has been updated to comply with current building codes is typically less expensive to insure than an older home that is not up-to-date.
|Condition of roof and home|
If you are considering a “fixer upper,” you may pay more for insurance until clear improvements are made. In particular, check out the condition of the roof. A new roof in good repair will be attractive to insurers and will save you money as well as aggravation.
|Plumbing, heating and electrical systems |
These systems can wear out, become unsafe with age or become dated as safer technologies are introduced. Recent upgrades make your home safer and less likely to suffer fire or water damage.
Homes equipped with smoke, fire and burglar alarm systems that alert an outside service may get sizeable discounts. Strong doors, dead bolt locks and window locks may also reduce insurance costs.
|Pool, wood burning stove, etc.|
You will need higher property and liability coverage if you are buying a home with features such as a pool or a wood burning stove. In the case of a pool, consider getting additional coverage, such as an umbrella or excess liability policy.
|Quality and proximity of the fire department|
Homes near a fire station, those with a hydrant close by and those located in communities with a professional rather than volunteer fire department will cost less to insure.
|Location, location, location|
Homes near the coast will be more expensive to insure because the risk of hurricane, wind or water damage is greater. In many states, you will pay the first few thousand dollars in damage before your insurance kicks in. You also need to think about the threat of floods or earthquakes. You will need separate insurance for these risks and it can be costly. Also, around the country, there are high-risk areas vulnerable to hurricanes, brush fires or crime that might not qualify for private insurance. To make insurance available, there are state-sponsored Fair Access to Insurance Requirement (FAIR) Plans. FAIR Plans, however, can be expensive and provide less coverage.
PLACING A BID
You have looked at a number of properties and are narrowing your search to a few homes. Now you need to get more specific information on the house and its insurability.
Check the house’s loss history report
Ask the current homeowner for a copy of the house’s insurance loss history report. This will provide information regarding claims filed during the last five years and answer two questions that any savvy homebuyer should ask: Are there any past problems in the home? If damage has occurred, was it properly repaired? Prior claims are not barriers to getting insurance, but you should know the history of the home before you go to closing.
|Get the house inspected|
A thorough inspection of the home is very important. The inspector should: check the general condition of the home; show you where potential problems might develop; double-check that past problems have been repaired; and suggest upgrades or replacements that may be needed. If a house has been well-maintained, you should have no trouble getting insurance. However, if the inspector raises questions, your insurance company will as well. In particular, have the inspector check for water damage, termites and other types of infestation. Special attention should be paid to the electrical system, septic tank and water heater. Find out if there is an underground oil storage tank, as many insurers will not provide policies for homes that have one.
|Contact your insurance professional|
Don’t wait until the last minute to think about insurance. Ask your current insurance professional if the house will qualify for insurance and get an estimate of the premium. The sooner you act, the smoother the process will be. If you do not have an insurance agent or company representative, get recommendations from family, friends or co-workers. Select someone you know and trust, as he or she will be an advisor for many years.
|Shop around for the best coverage|
Most people spend months looking for a house, but only spend a few minutes insuring it. Insurance companies sell insurance in different ways – some through their own agents, others through independent agents or brokers and still others directly by phone or over the internet. Select the arrangement that you are most comfortable with. Get the names of several highly regarded insurers. The higher the financial rating, the better prepared they will be if a real disaster strikes. Then compare prices – it could cut hundreds of dollars off the cost of your bill.