Connecticut

The Juniper Ridge neighborhood offers buyers vintage homes only 2 miles from I-84. With city services and a small private Lake (Lake Wackawanna), this neighborhood offers peaceful streets and charming well maintained cape cod and colonial styled home Many of the homes in this neighborhood were built before 1960 and sit on about .3 of an acre lots.  Enjoy ice skating in the winter and sitting by the lake in the summer time. Home prices range from the mid $200,000 for small homes needing some work to the high $400,000 for updated larger homes.  The Juniper Ridge neighborhood students do attend the Pembroke Elementary School,  Broadview Middle School and the nearby Danbury High School.

This has quickly become a very hot topic as of late although the new condominium guidelines were created and adopted last November. The reason for the delay is that FHA allowed "spot approvals" in non-approved complexes until February 1, 2010. Now spot approvals are no longer allowed. Because of this, financing has become much more difficult to obtain

What has changed?

As mentioned above, FHA does not allow "spot approvals". A spot approval was available to allow FHA financing in a condominium complex that is not on the FHA-Approved list. This made it possible for buyers with low-downpayments to purchase in complexes that were not FHA approved. As of February 1, 2010, this is no longer possible and I have heard of three examples in just the last couple of days where buyers could not obtain financing to purchase a Realtor-friend's condo listing.

Another big change is that during the current year, FHA has created a temporary set of guidelines for condo complex approvals that will sunset on December 31, 2010. After this year, FHA's guidelines for complex approvals will become more difficult.

In addition, complexes will now be required to get re-certified every two years to ensure that the complex continues to meet FHA's guidelines, mainly for insurance and owner-occupancy rates.

As a result of these changes, the Veterans Administration (VA) also released a memo saying that it will no longer be using the FHA Approved Condominiums list. Prior to the FHA changes, the VA also used the approved condo list in determining eligibility for VA financing. CHFA (Connecticut Housing Finance Authority) has also said that they will now ONLY use the FHA list and will not allow for spot approvals either.

Why is this important?

FHA loans constitute nearly half of all mortgages that are being written today. It provides financing for buyers with low-downpayments. Because of the new changes, if the complex isn't approved, an FHA loan cannot be used to finance the units in the complex. If this isn't bad enough, it also rules out CHFA loans and USDA Rural Development loans because both of these loan programs also use the FHA Approved Condo list. This means that if you own a condo in a complex that is not approved, you will have to locate a buyer that is not buying with any of these types of financing. In the $100,000 - $250,000 price range, you could be missing out on as much as 75% of the buyers.

This doesn't only affect buyers, but also homeowners looking to refinance. FHA will allow a "Streamline" refinance without an appraisal on a condo in a complex that is not approved. But any other type of FHA financing, including Reverse Mortgages for seniors, will not be available in non-approved complexes.

What if my complex is approved?

That is great! But unless your complex was approved between October 1, 2008 and today, it will have to get recertified on or before December 7, 2010. As more and more complexes become aware of this, FHA's processing centers will most assuredly become bogged down with approval and re-certification applications as EVERY complex needs to do this.

What if my complex isn't approved?

If you are living in a complex that is not FHA-approved, then buyers who are approved for FHA, CHFA and USDA financing will not be able to purchase your unit. Since the VA also made changes, your complex may not be approved for VA financing either. You will not be able to refinance your unit with any of the loan types mentioned above and that includes not having the ability to obtain a Reverse Mortgage.

The only types of financing available for buyers looking to purchase your unit would be Conventional loans (Fannie Mae and Freddie Mac) which require a minimum of 10% down currently and lenders who offer "hard money" or niche financing. Even Fannie Mae and Freddie Mac have their own condo approval lists that isn't shared with the public.

What do I need to do?

The first step is to contact your condo's association leadership to make sure that they are aware of this. You can direct them to this blog or give them my contact information. In a 2-minute phone call, I can determine whether or not the complex is approvable. If it is, I have the list of paperwork and a questionnaire for the association to complete and I can aid in the approval process.

So, the bottom line is that if your complex is not approved with FHA, it needs to be. And with the lenient temporary guidelines for 2010, there is no better time to do it than the present. With more and more condominium complexes being made aware of the need to become approved or recertified, processing time will increase as the year progresses so it should be done now.

Please contact me with any questions regarding condominium approvals. Don't forget that we are experts in no-money down and low-money down mortgage loan programs. You can email me at eric@righttracfg.com or call me at 860-647-7701 x13. I will be happy to answer any of your questions.

When it comes to No Money Down Financing, we are the Experts!

Eric Boucher
Right Trac Financial Group
860-647-7701 x13 Office
860-324-3324 Cell
eric@righttracfg.com

What to expect with your Bank of America short sale

Are you a Connecticut short seller with a Bank of America loan? Every short sale goes through the same basic steps: seller qualification, appraisal, negotiation, but the timeline varies greatly by lender. Bank of America is by far the slowest and most difficult lender to deal with in any short sale.

Bank of America can easily take 4-8 months to get through the short sale process, sometimes over a year. This time frame begins once you have a buyer, and not when you list your home, so be prepared for the long haul from the get go. Bank of America short sales are also often riddled with problems such as lost paperwork, inaccurate appraisals, unresponsive negotiators, and unexpectedly closed files. Since it will be difficult to find a buyer to stick it out during this process, you may end up going through several buyers, each one setting you back a few steps in the process. You will need to be highly committed to the short sale to get to the light at the end of the tunnel. If there is a single thing that will prepare you for this it will be the upfront expectation that you will be in for a long and trying road with this lender.

Recently, in an effort to "streamline" the short sale process Bank of America has introduced "Equator" an online automated short sale processing system. When entering into a short sale using Equator you as the seller will have to create an Equator account and enter your financials directly into the system, or your agent will be able to do this for you once the system has generated your account. A totally automated system has its advantages and disadvantages, as you could imagine.

It is too early to tell whether the Equator system will be an improvement to Bank of America's troubled short sale process, but anyone with experience in Bank of America short sales would likely conclude that it probably couldn't get any worse.

With that being said - come armed with your patience when dealing with Bank of America. And make sure you choose the right agent: For the best odds of success you will need a seriously patient and persistent agent, with plenty of experience in dealing with Bank of America.

STOP YOUR CONNECTICUT FORECLOSURE!

With qualified buyers in the market place looking for the best deal they can get, they are first drawn to the idea of getting a bargain with a foreclosure. The belief is that the desperate banks will accept a good offer even if it's not near the asking price.

If the foreclosure is a clean home requiring minimum work to make it move in comfortable, then it's not likely to stay on the market long and often will see multiple bids, ultimately being sold over asking.

The market demonstrates a reluctance to pursue a listing that is being offered as a distressed or short sale listing. So much is written about the banks' reluctance to negotiate a short sale, or lack of response, or delayed response. This leads to the frustration of waiting weeks or months to hear whether or not the bank will say yes to the bid. When this happens, the house languishes in the system, and because of the delay, it ultimately does come back as the foreclosure.

The listing agents for the distressed property should be doing a great deal of homework well in advance of getting the listing into the system.

• Recognizing that the home will indeed qualify as a potential short sale is one of the first steps.
• Getting into contact with the loss mitigation department of the bank at the onset to at least get all of the requisite forms into the owner's hands and fully completed and documented.
• Pricing the home to reflect the tone of the market
• Creating an action plan that gets the home exposure with price reductions done to get the house a viable contract within a relatively brief period on the market
• Then making sure the bank has all of the documentation it needs to either accept or provide a reasonable counter to the offer

If the Listing agent has done their homework properly and communicated consistently with the bank and the potential buyer there is a high likelihood that the deal can be done within 60 days. The house is occupied and maintained throughout the process, and the distressed owner gets a reprieve from a major mark to their credit rating, giving them hope of getting back into a stable lifestyle within a reasonably short period.

We believe that using a Real Estate Agent with experience in the short sale process is important. If you are behind in your mortgage payments and in danger of losing your home, you need to get advice from the right people. Many people say to contact your lender as soon as you fall behind in your mortgage payments. Theoretically, that is good advice. However, anyone who has tried contacting the lender to work out a payment plan or to request a short sale, knows that this is not always practical. Although many attorneys will handle a short sale for you many do not have the time or resources to get them approved. In addition attorneys will charge you a retainer- an upfront fee- to handle your short sale. Lastly, there are many companies that promise you that they will do your short sale for you for a upfront fee. Some of these companies are nothing more than scam artists- unscrupulous individuals trying to make money from people who are in danger of losing their homes in a foreclosure. Consider using a local licensed Real Estate Agent, someone you trust & who has a history of successful short sales.

If you are in a situation that is preventing you from meeting your monthly mortgage obligation we'd like a chance to speak with you about your options. Peter and Laura Testa are licensed Real Estate Agents who have been successfully handling Short Sale transactions for over 4 years. With a 100% success rate we are happy to lend our expertise- FREE OF CHARGE- to qualifying homeowners faced with financial hardship. To learn more about the short sale process please contact Peter or Laura Testa at 203-442-3873. Do not let valuable time slip by while you continue to default on your payments. Call us today.