Debbie Baldes, Roseville, CA RE Broker-Owner

Foreclosure Solutions-Hope for Home Owners

The current U.S. housing market and national financial crisis has caused untold stress and heartache for many American families. Foreclosure is one of the most devastating financial challenges that a family can face and one that many times can be avoided. The options available to home owners for foreclosure are many. Following is a brief explanation of these solutions:

1.) Reinstatement

A reinstatement is the simplest solution for a foreclosure, however it is often the most difficult. The homeowner simply requests the total amount owed to the mortgage company to date and pays it. This solution does not require the lender's approval and will 'reinstate' a mortgage up to the day before the final foreclosure sale.

2.) Forbearance or Repayment Plan

A forbearance or repayment plan involves the homeowner negotiating with the mortgage company to allow them to repay back payments over a period of time. The homeowner typically makes their current mortgage payment in addition to a portion of the back payments they owe.

3.) Mortgage Modification

A mortgage modification involves the reduction of one of the following: the interest rate on the loan, the principal balance of the loan, the term of the loan, or any combination of these. These typically result in a lower payment to the homeowner and a more affordable mortgage.

4.) Rent the Property

A homeowner who has a mortgage payment low enough that market rent will allow it to be paid, is able to convert their property to a rental and use the rental income to pay the mortgage.

5.) Deed in Lieu of Foreclosure

Also known as a 'friendly foreclosure', a deed in lieu allows the homeowner to return the property to the lender rather than go through the foreclosure process. Lender approval is required for this option, and the homeowner must also vacate the property.

6.)Bankruptcy

Many have considered and marketed bankruptcy as a 'foreclosure solution,' but this is only true in some states and situations. If the homeowner has non-mortgage debts that cause a shortfall of paying their mortgage payments and a personal bankruptcy will eliminate these debts, this may be a viable solution.

7.) Refinance

If a homeowner has sufficient equity in their property and their credit is still in good standing, they may be able to refinance their mortgage.

8.) Servicemembers Civil Relief Act (military personnel only)

If a member of the military is experiencing financial distress due to deployment, and that person can show that their debt was entered into prior to deployment, they may qualify for relief under the Servicemembers Civil Relief Act. The American Bar Association has a network of attorneys that will work with servicemembers in relation to qualifying for this relief.

9.) Sell the Property

Homeowners with sufficient equity can list their property with a qualified agent that understands the foreclosure process in their area.

10.) Short Sale

If a homeowner owes more on their property than it is currently worth, then they can hire a qualified real estate agent to market and sell their property through the negotiation of a short sale with their lender. This typically requires the property to be on the market and the homeowner must have a financial hardship to qualify. Hardship can be simply defined as a material change in the financial stability of the homeowner between the date of the home purchase and the date of the short sale negotiation. Acceptable hardships include but are not limited to: mortgage payment increase, job loss, divorce, excessive debt, forced or unplanned relocation, and more.

For more explantion of your options including drawbacks and benefits of each scenario click here!

Lawmakers tried to get you $15,000 but settled on $8,000. The next stimulus package called the American Recovery and Reinvestment Act of 2009, has been passed by Congress and signed into law.

So what does that mean to you?

Details were still sketchy but here's what to expect:

- The tax credit increases from $7,500 to $8,000.
- Anyone who has not owned a home in the last 36 months is eligible.
- The new provisions begin January 1, 2009 and will extend through the end of the year.
- The tax credit does not have to be paid back if the buyer stays in the home for at least 3 years.
- No changes to income eligibility: Buyers must make less than $75,000 for singles and $150,000 for couples. If you make more money than that you may be eligible for a partial credit.

How do you get the money? Here are a couple examples:

Example: At the end of the year your tax liability is $5,000, but you've overpaid by $1,000 through your withholdings. Normally, you would get a $1,000 refund check from the IRS. In this example, you get $9,000. The $8,000 credit plus the $1,000 you overpaid.

Example: Your final tax liability is $6,000, but you've underpaid through your payroll withholdings by $1,000. Normally, you would have to write the IRS a $1,000 check when you file your taxes. This time, the first $1,000 of the tax credit pays the amount you owe, and you get the remaining $7,000 as a refund.

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The not so good news: Those who bought a home last year and were eligible for the $7,500 credit. You still fall under the old rules requiring the tax credit to be paid back beginning in year 2010 at the rate of $500 a year.

Please contact me if you have any questions about this bill and how it may affect you.

www.ExecutivePropertiesOnline.com

Buying a home is no easy task. It's rather a complex process. To help insure that your home purchase is a profitable and successful one, I have teamed with with mortgage professionals to sponsor a Free Home Buyer Class to teach you the secrets of a successful home purchase.

Here's what you'll learn:

* Secrets of foreclosures and short sales
* How to find the hot deals
* How much can I afford to buy
* Is my credit good enough
* Loan programs available in this market
* Who qualifies for zero down payment
* Can the seller pay for my closing costs

Please register below for reserver you seat. Space is limited!

Our next class is:

Date: Thursday, April 16, 2009
Time: 6:30pm - 8:30pm (Registration starts at 6:00pm)
Place: Watt Ave. in Sacramento

Click Here to sign up before the class fills up!

Did the housing market trip you up?

Buying a home in California through a California Housing Finance Agency, aka CalHFA, assistance program? Not so fast! The real estate and mortgage industry suffered yet another blow this past Friday.

Due to the nature of the unsettled California budget, or lack of, CalHFA had no other option but to suspend their programs.

The Rest of the Story....

The good news...any loan in their system through Friday, December 19th, will be honored. After that, the program is at a standstill.

Remember FHA allows gift money.....so if you are thinking about buying a home....you know what to ask for this Christmas!

One more bit of useful information....After January 1st the new minimum down payment goes from 3% to 3.5%.

Search for your next home at www.ICanSearchtheMLS.com

WHEN: Thursday, December 4, 2008
7:00 p.m.

WHERE: Citrus Heights City Hall parking Lot
7117 Greenback Lane
Citrus Heights

Free cookies & hot chocolate! Visit with Santa & Mrs. Claus! Music!

For more information you can visit the city's web site at: www.citrusheights.net