California Mortgage Protection Program (FREE)

What if you buy a house and then get laid off? How are you going to make the monthly?

Payment insurance makes it a bit easier

We can help. Through the state association of Realtors, we can offer a new program designed to provide peace of mind to first-time buyers who are hesitant to enter the housing market due to concerns about potential job loss, and as a result being unable to meet their monthly mortgage obligations. Qualifying buyers can receive up to $1,500 a month for up to six months in the event of job loss, a qualified co-buyer can also receive a $750 benefit for up to six months to help pay the mortgage. The insurance is effective upon close of escrow, and kicks in upon job loss.

Best of all, the program is FREE to qualified home buyers.

To qualify for the Mortgage Protection Program, Applicants must:

• Be a first-time home buyer – someone who has not owned property in the last three years (includes co-buyer)
• Close on or before Dec. 31, 2009 (purchase agreement cannot be dated before April 2, 2009)

• Use a California REALTOR® in the transaction (ahem!)
• Purchase the property in California
• Be a W-2 employee (cannot be self-employed)

Call or text me 415.300.0432 right away for more details. Cheers! Jack

Shyster Loan Attorneys Probed by State Bar

The State Bar of California has recently launched numerous investigations against attorneys for misconduct related to loan modifications.  In a rare move, the State Bar has released the names of 16 attorneys under investigation, by opting to waive investigation confidentiality in favor of public protection.  These attorneys have allegedly taken fees from Marin County home owners for promised services, but failed to perform those services or even communicate with their clients who face the possible loss of their homes.  Their non-attorney staff may also be under investigation for unlawfully practicing law.

There is no indication that the CA Department of Real Estate has taken any interest in investigating this issue.

Not all attorneys engaged in loan modifications are unscrupulous.  However, this announcement from the State Bar serves as a good reminder for property owners to be extremely careful when dealing with attorneys and others for loan modifications.  Scam artists may intentionally associate or affiliate themselves with attorneys in an attempt to lend credence to their fraudulent schemes.  For more information contact Jack at 415.302.7787 or jmclaughlin@fhallen.com. The list of attorneys currently under investigation is available at http://calbar.ca.gov/state/calbar/calbar_generic.jsp?cid=10144&n=96395.

Source: CA Association of Realtors

What to Do If Your Mortgage is Sold to Another Investor

Approximately half of all mortgage loans are sold from one lender to another, often because the original lender is not equipped to collect payments, manage escrow accounts, pay taxes and insurance, respond to questions, and prepare payoff statements when the home is sold or refinanced.  Some borrowers may receive letters in the mail alerting them of the sale of their loan a few days after closing, while others may not receive a notice for years.

In the mortgage-industry, this is called a “transfer of servicing,” and is a common practice.  Borrowers should not be concerned about these changes, as the majority of lenders transfer their servicing rights to loans.  Generally, the selling of a mortgage loan from one lender to another is a smooth transition and does not impact the borrower.  Every so often though, there is a misstep by either the loan buyer or the loan seller.

Under the National Affordable Housing Act, when a mortgage loan is sold, the borrower is required to receive a “goodbye” letter from their current servicers at least 15 days before their next payment is due.  The letter must state the name, address, and telephone number of the new servicer; the date the old company will stop collecting payments; and the date the new company will start accepting them.  Under the Helping Families Save Their Homes Act, signed by President Obama on May 20, the new owner of the loan—which may or may not be the servicer—also must notify the borrower of the transfer within 30 days, known as the “hello” letter.

The “hello” letter should outline the same information as the “goodbye” letter sent from the former loan servicing company.  Borrowers should be cautious if they receive a “hello” letter without receiving a “goodbye” letter, as they may be the intended victim of a scam by someone who is hoping to unlawfully receive the monthly mortgage payments.  Concerned borrowers should contact their current loan servicer to verify if their loan has been transferred.  If it hasn’t, authorities should be notified immediately.

In most cases, a mortgage payment sent to the old servicer automatically will be forwarded to the new servicer for a brief amount of time, typically 60 days.  However, if payments are not sent to the correct servicer, they could become lost, and the homeowner may incur late fees.

Top Five Reasons Your House Didn’t Appraise

By Jack@mmsmarin.com

You found just the right house at last. Or you are trying to lock in a low refi rate. You know what the house is worth, but the appraisal comes in well below value: what’s up with that? You are not alone. In today’s tight lending climate, if your house doesn’t appraise, here are the most common reasons.

1. Under the new rules, your lender can no longer select, or even communicate with, the appraiser. They must use an independent – but often bank-owned – appraisal management company (AMC).
2. The appraiser couldn’t find your house. The AMC maximizes profits by selecting the cheapest appraiser, regardless of their location. The appraiser may come from Pleasanton to value your Mill Valley house. And local knowledge, especially in eclectic communities like Marin County, is critical to determining market value.
3. Your lender no longer can perform “value checks,” where appraisers informally pull comps to see if the numbers are likely to work for a client, before the actual appraisal is ordered and paid for.
4. The appraiser was incompetent. AMC requires professional appraisers to cut their fees as much as 50%. Since the best won’t work for less, they hire the new and less skilled appraisers, who may perform less thorough valuations.
5. There aren’t any good comps. With fewer sales, appraisers may need to look in dissimilar areas or go back in time to find similar properties that sold.

Call me if you have a problem. I can likely help you get the numbers up. Jack 415.302.7787