Monthly Archives: March 2016

Facing Foreclosure ?

Can an Investor Buy Your Home if You’re in Foreclosure and Sell It Back to You?

Short sales fraud is rising as investors seek to profit from lender losses.

Government initiatives have helped to facilitate widespread and legitimate alternatives to foreclosure, such as short sales. Lenders work with homeowners to sell their home for less than the balance owed and accept the sale proceeds as settlement. Homeowners in foreclosure are financially distressed and often desperate to keep their home. Investors take advantage of short sales to make money off of financially distressed homeowners by re-selling the home to them for a profit.

The Basics

Short sales take place in the pre-foreclosure stage and sometimes before the homeowner defaults. This is because the lender is convinced the homeowner’s financial circumstances will cause him to end up in foreclosure eventually. Nonetheless, convincing a lender to short sell a home is not easy. The transaction takes several months to complete, requires full documentation of the homeowner’s financial situation, marketing of the property and negotiating sales price and terms with the lender. Lenders prohibit homeowners from benefiting from the short sale by living in the home after the sale.

Mortgage Fraud

Lenders consider a homeowner who remains in the home after a short sale as a tenant or buyer a participant in mortgage fraud. When short sales rise, so does fraud, says Freddie Mac, one of the major owners of the nation’s mortgages. As a result, most lenders require homeowners to sign an Arm’s Length Affidavit, a disclosure provided to all parties to the transaction before the close of escrow. It stipulates that behind-the-scenes arrangements that allow the homeowner to benefit financially from the short sale are illegal. In a typical short sale fraud, as detailed in a CNN report, a real estate agent obtains a legitimate bid on a short-sale home. The agent sandbags the bid while presenting the bank a lower bid from an accomplice scammer. After the bank accepts the low bid, the real estate agent sells the home to the original higher bidder, thus cheating the bank and pocketing the profit.

Considerations

A homeowner in foreclosure cannot afford to pay the mortgage he already has and therefore cannot acquire a new mortgage in the near future. The impact of missed payments and the short sale itself diminishes credit. Furthermore, a waiting period set by lender seasoning requirements prevents a borrower with a prior short sale from obtaining a new mortgage for at least several years. If the homeowner buys back his home with cash, the lender may consider it fraud because he claimed financial hardship before the short sale.

Tips

The real estate professional selling your home is aware of the Arm’s Length Affidavit and that he may also be held liable for any involvement or knowledge of a short sale scheme in the transaction. If an investor approaches you directly with the plan, the real estate agent is required to act in your best interest, not the investor’s, and support you in rejecting the offer.

Is Your home Healthy ??

Is Your House Ruining Your Health ?

Is Your House Ruining Your Health?

Home has traditionally been viewed as a sanctuary, a place of refuge from the dangers and uncertainties lurking in the outside world. As safe and secure as we try to make our homes, hidden perils can sometimes still find their way inside. According to the U.S. Environmental Protection Agency, as many as 6 out of 10 homes and buildings are actually hazardous to human health. Consider also that, according to the Greenguard Environmental Institute, most people spend about 90 percent of their time indoors, where air pollution levels are typically two to five times higher than they are outdoors. The primary contributors to poor indoor air quality are furnishings and building materials, which release hundreds of volatile organic compounds (VOCs) into the air. Because prevention is the first step toward a cure, here we highlight some of the most common sources of indoor health hazards and offer a few practical alternatives that can lessen your family’s exposure to household toxins.

Asbestos

Once an extremely common building material, asbestos is often found in older homes, particularly in shingles, ceiling tiles, and flooring. This durable, fire-resistant material is composed of microscopic fibers. If these fibers become airborne they can be trapped in the lungs, where they can cause a host of health problems. Professional asbestos testing and removal can protect you from this substance’s ill effects.
Lead

Another common contaminant in older homes is lead, a toxic metal that was once widely used in paints. It poses particular danger for children, who may ingest chips of flaking paint and dust from window frames or door moldings. Lead poisoning can lead to developmental delays, learning disabilities, and harm to the nervous system, so it’s imperative to eliminate the contamination from your home and choose lead-free materials going forward.
Paint

While today’s paints no longer contain lead, they do contain VOCs, which can off-gas, irritating the eyes, nose, and throat. Fumes from oil-based paints are typically the worst offenders; these paints are therefore usually reserved for outdoor projects and small-scale indoor uses where their hard, glossy finish is preferred. Latex paints, which produce fewer odors, are most commonly used indoors. Many companies now offerlow-VOC paints that have fewer toxic fumes.
Solvents

Cleanup after a painting project can also mean exposure to harmful VOCs, resulting in headaches and dizziness. Paint thinners and other solvents typically contain high levels of VOCs, which can permeate indoor air and furnishings. There are numerous “green” solvents on the market that are designed to eliminate paint, grease, and oil without harmful side effects.
Mold

One of the most prevalent causes of household illness is mold, which can lurk in damp environments, including basements, carpeting, the areas under sinks, or even in wall and ceiling insulation. This living organism gives off airborne spores, which can cause allergic reactions as well as respiratory and skin problems. Eliminating any damp conditions in your home is the key to prevention.
Formaldehyde

Commonly used in drywall, engineered woods, paneling, and other construction materials, this chemical preservative is linked to myriad health problems, including eye, nose, throat, and sinus issues. Many manufacturers today are marketing formaldehyde-free products to avoid these potential health hazards.
Flame Retardants

The average American home contains multiple sources of toxic flame-retardant chemicals—called polybrominated diphenyl ethers, or PBDEs—because they are widely used in carpeting, upholstery, draperies, and other textiles, as well as in foam insulation, electronics, and plastics. PBDEs have been linked to cancer and reproductive disorders. In the past, the use of these chemicals was mandated by law; today, however, there are less-toxic alternatives available.
Herbicides and Pesticides

Although most of these chemicals are put to work outside the house to prevent unwelcome visitors in the garden and lawn, they can enter the house on shoes and clothing, and even in the air. Many of these substances can cause illness in people and pets, so it is best to seek out natural pest control options and enforce a leave-the-shoes-at-the-door policy.
Treated Lumber

Treated lumber is a popular choice for decks, fences, and other outdoor projects because the wood is durable, long-lasting, and resistant to weather and insects. Treated lumber, however, is filled with chemicals—insecticides, fungicides, arsenic, and copper to name a few—which can cause a range of health problems, including cancer. Naturally durable woods like redwood or cedar may be a healthier alternative.
Cleaning Products

It turns out that many bath and kitchen cleansers contain chemicals that are dangerous to the skin and eyes, and often produce fumes that can irritate the nose and throat. Fortunately, nontoxic cleansers like vinegar, lemon juice, and baking soda enable you to remove dirt without adding danger.
Radon

Although you can’t see, smell or taste radon, this highly radioactive gas can move up through the ground and into your home through cracks and holes in the foundation. It is the second leading cause of lung cancer in the US, so measures to mitigate the gas are crucial. There are plenty of inexpensive DIY radon kits in the marketplace, but you may want to hire a qualified tester, especially when buying or selling a home.
For More…

If you’re interested in more about home hazards, consider:
8 Home Hazards—and How to Mitigate Them
10 Pretty Plants You Didn’t Know Were Poisonous
The Power Outage Survival Guide

Location Is Key

4 WAYS YOUR LOCATION CAN BOOST OR BUST YOUR HOME VALUE

Close More Deals – Qualify homebuyer leads fast and free

A few years back, “the Starbucks effect” became a legitimate term to explain the higher real estate values associated with living close to the coffee house. But being within easy striking distance of a Grande Skinny Vanilla Latte isn’t the only thing that can help boost your home value. Then again, not every location can help build equity. Chose wrong, and you could see your value drop – even if the house is great.

1. Being close to schools

The good:

Families seek out neighborhoods with good schools for obvious reasons. Living close to a quality elementary school is especially desirable for parents who envision walking with their young children in the morning.

From a value standpoint, a location close to well-performing schools can be a smart decision for buyers regardless of their family status. “Living near a high-scoring school can increase your home’s value by over $200,000, according to the Brookings Institution,” said AOL.

The Columbia County News-TimesThe not so good:

But, being too close to a school – no matter how good it might be – may be a deterrent for some buyers, which could end up hurting your bottom line. If you’re in the path of the school pickup and drop-off, which creates considerable traffic, or directly across the street from a playground, which means there is noise throughout the day, you could have trouble when it comes time to sell. A location that is close enough to be easily accessible but out of range of the daily inconveniences is often the best option.

2. Being close to area conveniences

The good:

“The Starbucks effect” is tangible: Data has shown that, “Between 1997 and 2013, homes closer to the coffee shop increased in value by 96%, compared to 65% for all U.S. homes,” said CNN Money.

Now Starbucks has company, with a new report that shows that proximity to a high-end grocery store – namely Trader Joe’s or Whole Foods – can also raise home values considerably.

“Between 1997 and 2014, homes near the two grocery chains were consistently worth more than the median U.S. home,” said Business Insider. “By the end of 2014, homes within a mile of either store were worth more than twice as much as the median home in the rest of the country. The analysis found that 2 years after a new Trader Joe’s opened, home values within one mile went up by 10 percentage points more than homes in the rest of the city.

The not so good:

But, that doesn’t mean all area amenities boost home value. Adult entertainment spots, industrial businesses, a nearby airport that puts the home in the path of flights, and small businesses like tattoo parlors, check cashing, cash advance, or pawn shops that can be indicators of a lower-income or high-crime area can drive people away.

3. Being convenient to freeways

The good:

A location close to major thoroughfares can be a selling point since it helps homeowners cut down on the dreaded daily commute. Many suburbs require an additional 10 to 20 minutes in the car after exiting the highway. Promoting the convenience of a home closer in can help it stand apart.

USA TODAYThe not so good:

Having a car fly off the freeway onto your roof is not ideal. Neither is having to endure the daily noise, congestion, and pollution of living right next to the freeway. If it bothers you, it’s going to bother buyers when you sell. Being close – but not TOO close – is key.

4. Quiet location

The good:

A home that’s in a peaceful area surrounded by nature may be a benefit to buyers seeking a serene setting. A house that backs up to nature or is close to hiking trails can sell for more than a house in the same neighborhood that’s only surrounded by other houses.