New Rules for Overbidding on HUD Homes!!

Those of you who have previously bid on HUD homes or have heard of some horror stories about trying to buy one.. well things are getting better on the bidding process.  Many agents have found it increasingly difficult to win the HUD bids for their clients as many other agents routinely over bid on the properties hoping to obtain a higher appraised value.  Many times the higher appraised value is not obtained and the purchaser is either unwilling or unable to bring the cash difference to the closing table, thus wasting a lot of time and unnecessarily keeping properties off the market.

Well, the rules have now changed and this is going to help owner occupants get the home they desire for a fair price!!

What if my offer price is higher than the appraised value?


FHA guidelines will limit the underwriter to insuring the loan for the lower of two values; the offer price or the appraised value (displayed as the As-Is Value). If your offer price is higher than the appraised value, the FHA underwriter will require that your buyer(s) cover the overbid amount with a cash deposit. The buyer(s) will not be allowed to build the overbid amount into an FHA loan.

HUD’s mortgagee letter 2000-27 will require that the FHA UW (Under Writer) use the appraisal obtained by PEMCO. This mortgagee letter instructs the FHA UW NOT to obtain a new appraisal; nor can the FHA UW request that new comps be pulled and the PEMCO appraisal updated.

If your offer price is higher than the appraised value and tentative acceptance is extended to you, the options available to you are:

1. Proceed with contract execution. PEMCO will require that the selling broker verify that the cash reserves are available to cover the overbid amount before we execute the contract.

2. Use cash or conventional financing. All of the guidelines outlined above apply to FHA financing only. A conventional lender will have their own set of guidelines not governed by HUD.

3. Cancel prior to contract execution. If there is an acceptable backup, we will award tentative acceptance to the backup offer. If there are no acceptable backup offers, the property will be relisted.



If an investor or any buyer gets a property awarded, but Buyer’s lender does not accept HUD’s appraisal, and the value comes in lower in another appraisal, can HUD adjust price? Absolutely not.

If an investor cancels escrow due to property financing because of value not being there, does he lose his deposit? Yes.

Refer to Addendum A. The only guidelines that will allow an investor to get any portion of their earnest money back is if an investor is using FHA financing and the FHA underwriter determines that the investor is not an acceptable borrower, then 50% of the earnest money deposit will be refunded.

As you know, FHA’s loan products are not set up for investor use; so the potential for an investor to receive any portion of their earnest money back is remote.

What about if property was purchased under Owner Occupancy, will the same rules apply?

Answer – Yes, the same rules apply, but if you read Addendum A, you will find that this addendum has many more provisions when it comes to returning all or a portion of the earnest money deposit to an owner occupant buyer. If the underwriter determines that the value of the property has dropped below the purchase price, PEMCO could determine that the cancellation of escrow is based on “other good cause” and it is probable that 100% of the earnest money will be refunded.

All of these are HUD owned properties you can own for $45,000!!! and only $100 Down!!

Lawmakers to Extend $8,000 tax credit!!!

Lawmakers seek to extend $8,000 tax credit


from associated press (AP) – 3 days ago



WASHINGTON — Lawmakers are trying to extend and expand an $8,000 federal tax credit for first-time homebuyers, a stimulus-package tax break that many regard as a significant prop for the still-tottering economy.
The latest Senate proposal would drop the requirement that the credit be available only to first-time buyers, broadening the reach of the program but also adding to its cost, estimated by congressional analysts at $16.7 billion.
The backers of that idea, Sens. Johnny Isakson, R-Ga., and Christopher Dodd, D-Conn., chairman of the Senate's banking committee, have suggested that their measure be attached to another pending bill aimed at throwing a lifeline to people hit by the recession, an extension of federal assistance to the millions in danger of exhausting unemployment insurance benefits.
While the White House says there will not be a second stimulus package following the $787 billion economy booster enacted last February, extending the homebuyers' credit and unemployment benefits are among several primary means being pushed by the administration or Congress to help people get through the prolonged economic downturn.
Others include continued subsidies for laid-off workers trying to keep their health insurance and a proposal by President Barack Obama to provide seniors and others with a $250 payment to make up for the lack of a Social Security cost of living increase next year.
The stimulus-package credit allows first-time homebuyers to reduce their federal income taxes by 10 percent of the price of a home, up to a maximum of $8,000. The credit, which could cost in the $12-15 billion range this year, is set to expire Dec. 1.
The Isakson-Dodd proposal would extend the credit to June 30, 2010. It would also remove the first-time homebuyer requirement and raise the eligibility income limit to $150,000, or $300,000 for a couple. That's double the current phase-out limits.
As with the Cash for Clunkers program for cars, skeptics have questioned whether the credit will have any long-term effect on the housing market.
Brookings Institution economist Ted Gayer wrote in a recent report that the tax credit is "very poorly targeted." He calculated that of the 2 million or more people who would make use of the credit if it were extended for a year and expanded to cover all buyers, only about 383,000 would be additional sales motivated by the credit. He estimated that the real cost of the credit would thus be more than $40,000, rather than $8,000, per buyer.
But believers say it has been instrumental in sustaining an economic recovery highly dependent on housing.
The National Association of Home Builders, the source of the 383,000 figure for increased home purchases, pointed out that this would also create more than 347,000 jobs, generate $16.1 billion in wages and salaries and $12.1 billion in business income.
"Homebuyers for the past two years have been sitting on the fence and we needed something to move them into the market," said Lucien Salvant, managing director for public affairs at the National Association of Realtors. With more foreclosures coming next year, "to knock the props out of the housing market at this point would not be a wise move."
The NAR, together with the NAHB and the Mortgage Bankers Association, have been running ads in the Washington area urging Congress to extend the homebuyer tax credit.
They note that home sales to first-time buyers have increased by 25 percent in 2009 and now account for 50 percent of all sales. They add that first-time buyers are often at the lower end of the market and the tax credit is reducing the inventory of foreclosures.
Isakson, in a speech on the Senate floor this week, said lawmakers owed it to the country to extend "a proven program that works" and "buoy the marketplace."
He said that if the program is allowed to expire, the market again will depress values, sales and consumer confidence.

Senate Democratic leaders have not decided whether the homeowners' credit issue should be part of the unemployment bill. But there is powerful backing for taking it up in some form.
House Speaker Nancy Pelosi, D-Calif., said last week that she is looking into extending and expanding the popular tax credit, which according to IRS data has so far drawn more than 1.4 million applications from first-time homebuyers.
Senate Majority Harry Reid, D-Nev., last month joined Sens. Ben Cardin, D-Md., John Ensign, R-Nev., Debbie Stabenow, D-Mich., and Isakson in introducing a bill calling for a straight six-month extension of the tax credit.
The potential addition of the Isakson-Dodd proposal to the unemployment benefit bill would be a new element to a bill that the Senate is already trying to enlarge.
The House last month passed legislation to increase jobless benefits by 13 weeks, but only in those 27 states where the unemployment rate is at or above 8.5 percent.
That left lawmakers from the other 23 states unhappy, and last week Senate Democrats reached agreement on a bill that would give an additional 14 weeks of benefits in all 50 states, and another six weeks on top of that to those in states with the 8.5 percent unemployment rate. The national unemployment rate is 9.8 percent.
Currently, a laid-off worker in a high unemployment state is entitled to up to 79 weeks of state and federal assistance. The average payment is about $300 a week. Supporters of the extension say it is necessary in an economy where 15 million unemployed are competing for 3 million jobs.

Clayton County Housing Authority Now has Down Payment Funds for Homebuyers!

This HUGE home is located in Clayton County!  It is only $100 down and this home qualifies for the Clayton County Home Buyer Assistance Program for an additional $5,000 towards the purchase!!

Clayton County Homebuyer Assistance Program (CHAP)

Clayton County provides first-time, low and moderate-income homebuyers with downpayment assistance through its HOME Investment Program. Applying for these funds has been subcontracted to the Housing Authority of Jonesboro which will provide eligible homebuyers with a Deferred Payment Loan for up to $5,000. If the homebuyer loses or sells the house within the first 60 months after closing this money will have to be repaid to the County. If the homeowner retains the property for 5 full years, the downpayment assistance becomes a grant and does not have to be repaid.

Naturally, the home purchased, must be in Clayton County and the buyer will be required to obtain a fixed-rate mortgage from a reputable lender.


Income limits are 80% of HUD Area Median Income Limits. Borrower contribution is $500. Purchase price limit is $180,000. They can be reached at 770-478-7282

Home buyer education counseling is also a requirement and can be obtained through a HUD approved counseling agency.

Please contact me if you would like further assistance using this program!!

Atlanta Development Authority Down Payment Assistance Program

Downtown Living can be yours!

The Atlanta Development Authority has several Homebuyer Down-Payment Assistance Programs. The Beltline Affordable Housing Trust Fund, Atlanta Affordable Homeownership Program, Opportunity Down Payment Assistance Program, Vine City/ English Ave Trust Fund. For all of these programs the borrowers must qualify for a first mortgage in addition to down payment assistance, which is a second mortgage. The buyer qualifications vary from program to program. This is the information for the Atlanta Affordable Homeownership Program.


The ADA program provides the buyer with a down payment of up to $15,000 or 10% of the sales amount, which can be used as a down payment, and or pay up to 50% of the closing cost. There are no monthly payments required on the second mortgage. The maximum purchase price is $252.890. The qualifications for the buyer is as follows:
Buyer is a first time home buyer and has not owned a home within the past three years.
Buyer must purchase within the incorporated city limits of Atlanta. Within the CDIA area.

Homebuyer counseling is required throught a HUD certified agency.  You can email me for a list of qulifying counseling programs.  These programs are free.
The homebuyer must contribute $1,500 of their owne money toward the transaction. this can easily be accounted for by the earnest money, appraisal, home inspection.

The buyer can qualify for a Conventional, FHA, VA 30 year fixed rate loan.

The following income limits apply depending on the size of the household:
1 person $40,150
2 person $45,900
3 person $51,600
4 person $57,350
5 person $61,950
Properties that are eligible are: single family detached homes, townhomes and condominiums located within the city limits of Atlanta .

The loan is deferred for five years, repayment is due in full upon sale, transfer, refinancing or when the home is no longer owner-occupied.  It remains as a "soft second" loan on the title of the property.

Please contact me for additional information and a list of participating lenders! 
Thanks for reading!

Foreclosure Prevention- Making Home Affordable & Hope Now

This home is listed by HUD for only $112,0000!  A great opportunity to move into a newer home at an affordable price!

If you know someone who is experiencing a difficult time, there is help.  President Obama has an initiative to assist homeowners in these difficult times.  I have outlined some information in this article and provided a website & contact numbers so that you may follow up.

Beware of Foreclosure Rescue Scams - Help Is Free!


•Scam artists often target homeowners who are struggling to meet their mortgage commitment or anxious to sell their homes. Recognize and avoid common scams.

•Assistance from a HUD-approved housing counselor is FREE.

•Beware of anyone who asks you to pay a fee in exchange for a counseling service or modification of a delinquent loan.

•Beware of people who pressure you to sign papers immediately, or who try to convince you that they can “save” your home if you sign or transfer over the deed to your house.

•Do not sign over the deed to your property to any organization or individual unless you are working directly with your mortgage company to forgive your debt.

•Never make a mortgage payment to anyone other than your mortgage company without their approval.

http://www.makinghomeaffordable.gov/

The making home affordable program can assist home owners facing foreclosure in several ways. They can reduce your monthly payments by half for up to six(6) months and place your arreage on the back of your loan. they can also help assist you with a loan modifiation.  It is best to be prepared prior to speaking with a counselor about your situation.

Home Owner Checklist:  It is a good idea to have your documents ready prior to speaking with a Counselor 

•Information about your first mortgage, such as your monthly mortgage statement.

•Information about any second mortgage or home equity line of credit on the house.

•Account balances and minimum monthly payments due on all of your credit cards.

•Account balances and monthly payments on all your other debts such as student loans and car loans.

•Your most recent income tax return.

•Information about your savings and other assets

•Information about the monthly gross (before tax) income of your household, including recent pay stubs if you receive them or documentation of income you receive from other sources.

•It may also be helpful to have: A letter describing any circumstances that caused your income to be reduced or expenses to be increased (job loss, divorce, illness, etc.) if applicable.
 
Call Hope Now @ 1-888-995-4673
 
.Once you have tried this avenue, if it does not work out then the next step to avoid a foreclosure would be to consider a short sale.   This is when you ask the bank for approval to sell your home for less than your original loan amount to avoid a foreclosure.  This is becoming a option that benefits both parties in the long run.  You will avoid having a foreclosure on your credit report and te bank does not have to put the home through its costly and time consuming REO process.  I will be providing more information on the Short Sale process in the future!
 
As always, thanks for reading!!

Get Up To $1,800 Back On Your Georgia State Income Tax When You Purchase a Home!

This Lawrenceville Hud home is listed at only $110,000!  Yes, it is part of the $100 down payment and 3% closing cost contribution program with FHA financing!

Get up to $1,800 back on your Georgia State Income Taxes when you buy a home before November 2009!

Governor Perdue signed the Georgia Homebuyer Tax Credit this week, which is GREAT news for Georgia home buyers. The bill will offer up to $1,800 in tax credits to Georgia homebuyers via a credit on their state income tax.


House Bill 261 gives a credit of either $1,800 or 1.2 percent of the purchase price, whichever is less. (You can only claim one-third of the credit each year, beginning with your 2009 Georgia tax return.) The purpose of the bill is to create a stimulus for home sales, and give a boost to the Georgia real estate market.

Here is how the Georgia Homebuyer Tax Credit applies to home purchases:

Applies to single-family homes and condos if they are your primary residence

The property must have been for sale prior to May 11, 2009 and must still be for sale

The property must be in default on or before March 1, 2009

The property has already been foreclosed on and is held by the bank or mortgage company

Homes purchased between June 1 and November 30, 2009 that meet the criteria will be eligible for the tax credit.


Here is just another reason why you should consider taking advantage of the great opportunites to get into your home today!

Get $8,000 Back On Your Federal Income Taxes! Hurry before December 1, 2009!

This loft is listed at only $102,000 for downtown Atlanta!

1.Who is eligible to claim the tax credit?


First-time home buyers purchasing any kind of home—new or resale—are eligible for the tax credit. To qualify for the tax credit, a home purchase must occur on or after January 1, 2009 and before December 1, 2009. For the purposes of the tax credit, the purchase date is the date when closing occurs and the title to the property transfers to the home owner. A limited exception exists for certain contract for deed purchases and installment sale purchases. See the IRS website for more detail.

2.What is the definition of a first-time home buyer?

The law defines "first-time home buyer" as a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse.

3.How is the amount of the tax credit determined?

The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.


4.Are there any income limits for claiming the tax credit?

Yes. The income limit for single taxpayers is $75,000; the limit is $150,000 for married taxpayers filing a joint return. The tax credit amount is reduced for buyers with a modified adjusted gross income (MAGI) of more than $75,000 for single taxpayers and $150,000 for married taxpayers filing a joint return. The phaseout range for the tax credit program is equal to $20,000. That is, the tax credit amount is reduced to zero for taxpayers with MAGI of more than $95,000 (single) or $170,000 (married) and is reduced proportionally for taxpayers with MAGIs between these amounts.
5.How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008?

The most significant difference is that this tax credit does not have to be repaid. Because it had to be repaid, the previous "credit" was essentially an interest-free loan. This tax incentive is a true tax credit. However, home buyers must use the residence as a principal residence for at least three years or face recapture of the tax credit amount. Certain exceptions apply.


6.How do I claim the tax credit? Do I need to complete a form or application?

Participating in the tax credit program is easy. You claim the tax credit on your federal income tax return. Specifically, home buyers should complete IRS Form 5405 to determine their tax credit amount, and then claim this amount on line 67 of the 1040 income tax form for 2009 returns (line 69 of the 1040 income tax form for 2008 returns). No other applications or forms are required, and no pre-approval is necessary. However, you will want to be sure that you qualify for the credit under the income limits and first-time home buyer tests. Note that you cannot claim the credit on Form 5405 for an intended purchase for some future date; it must be a completed purchase.

7.What types of homes will qualify for the tax credit?

Any home that will be used as a principal residence will qualify for the credit. This includes single-family detached homes, attached homes like townhouses and condominiums, manufactured homes (also known as mobile homes) and houseboats. The definition of principal residence is identical to the one used to determine whether you may qualify for the $250,000 / $500,000 capital gain tax exclusion for principal residences.
8.I read that the tax credit is "refundable." What does that mean?

The fact that the credit is refundable means that the home buyer credit can be claimed even if the taxpayer has little or no federal income tax liability to offset. Typically this involves the government sending the taxpayer a check for a portion or even all of the amount of the refundable tax credit.

For example, if a qualified home buyer expected, notwithstanding the tax credit, federal income tax liability of $5,000 and had tax withholding of $4,000 for the year, then without the tax credit the taxpayer would owe the IRS $1,000 on April 15th. Suppose now that the taxpayer qualified for the $8,000 home buyer tax credit. As a result, the taxpayer would receive a check for $7,000 ($8,000 minus the $1,000 owed).

9.I purchased a home in early 2009 and have already filed to receive the $7,500 tax credit on my 2008 tax returns. How can I claim the new $8,000 tax credit instead?

Home buyers in this situation may file an amended 2008 tax return with a 1040X form. You should consult with a tax advisor to ensure you file this return properly.

10. I am not a U.S. citizen. Can I claim the tax credit?

Maybe. Anyone who is not a nonresident alien (as defined by the IRS), who has not owned a principal residence in the previous three years and who meets the income limits test may claim the tax credit for a qualified home purchase. The IRS provides a definition of "nonresident alien" in IRS Publication 519.

11.Is a tax credit the same as a tax deduction?

No. A tax credit is a dollar-for-dollar reduction in what the taxpayer owes. That means that a taxpayer who owes $8,000 in income taxes and who receives an $8,000 tax credit would owe nothing to the IRS.

12.I bought a home in 2008. Do I qualify for this credit?

No, but if you purchased your first home between April 9, 2008 and January 1, 2009, you may qualify for a different tax credit. Please consult with your tax advisor for more information.

13.Is there any way for a home buyer to access the money allocable to the credit sooner than waiting to file their 2009 tax return?

Yes. Prospective home buyers who believe they qualify for the tax credit are permitted to reduce their income tax withholding. Reducing tax withholding (up to the amount of the credit) will enable the buyer to accumulate cash by raising his/her take home pay. This money can then be applied to the downpayment.

More information about the guidelines is available on the NAHB web site. Read the HUD mortgagee letter (pdf) and an explanation of the FHA Mortgagee Letter on Tax Credit Monetization (pdf). An FAQ about monetization (pdf) is available at the NAHB web site.

• The credit is available for homes purchased on or after January 1, 2009 and before December 1, 2009. Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the credit.

$100 Down Payment Program offered by HUD

This lovely Lawrenceville home was offered at only $115,000 by HUD

In this article I will be explaining the $100 down payment program offered by HUD for Owner Occupants to purchase a home.

A HUD home is a 1 to 4 unit residential property acquired by HUD as a result of a foreclosure action on an FHA-insured mortgage. HUD becomes the property owner and offers it for sale to recover the loss on the foreclosure claim.
HUD Homes are initially offered to owner-occupant purchasers (people who are buying the home as their primary residence). Following the priority period for owner occupants, unsold properties are available to all buyers, including investors.
If you are an evacuee displaced by Hurricane Katrina, Rita or Wilma, HUD could sell a HUD home at a discount to you. (I will be writing another article on that soon!)

All properties available for purchase will be listed on http://www.bidselect.com/  This is a contrator hired by HUD to manage their lsitings.  You cannot buy the properties directly from HUD, Bidselect, or the contractor that is used in Georgia to process the paper work (PEMCO).  If you ae interested in purchasing a HUD home you must contact a HUD approved Real Estate Broker.  The Brokers working with HUD properties must go through an annual renewal process and they are (should be) familiar with the HUD bidding process, which is much different than that of general sales and working with other agents.  Also HUD uses its own key for agents to enter their properties and the HUD owned homes are not on any lockbox for you to enter on your own, or for any agents that are not HUD approved to use via the agent SUPRA lockbox.

The $100 Down payment Program
I love this program.  After congress did away with most of the down payment assistance programs last year, it left a gaping hole in the market.  Many people wanted to purchase a home, however coming up with the 3.5% down payment requirement dashed a lot of the dreams of the first time home buyers.  Many buyers can afford to maintain the monthly payments, however saving a lump sum of money proved difficult for many.  Thus the HUD $100 down program became much more attractive.

Basically if you are going to live in the home, HUD will allow you to close with a $100 down payment.  Once your successful bid is acknowledged by HUD (accepted), then your Broker will fill in $100 where the contract asks for the down payment amount.  HUD will still expect you to pay them the earnest money amont which is $500 for homes less than $49,000 and $1000 earnest money for homes more than $50,000.   Your loan amount will basically be almost 100%.  This is allowable by HUD and most banks will allow this type of financing when you are purchasing a HUD home.  But I suggest making sure your lender is aware that you are looking at HUD homes and intend on buying one.  The last thing that you want is an ugly surprise at the closing table, because believe it or not, although allowable by HUD, some lenders will not fund on a 100% financed home.

Another nice buyer bonus is that HUD will also give you a $1,000 buyer bonus at the closing table if you are going to be an owner occupant and if this it the first time the home has been listed by HUD and if your bid is won within the first 30days of the listing.  You can use this toward additional closing costs or it could mean you get some cash back at the closing table.  You will have to get with your lender to see how these funds can & will be applied.

Many times when buyers think of HUD homes, they get an image of an old beat up run down fixer upper.  Well let me tell you that is most certainly not always the case.  Now HUD does have many homes in it's website that are not FHA insurable (meaning the repairs will cost more than $5,000 to make it pass an FHA inspection for FHA financing), but please know that due to the economy and the flood of foreclosed homes coming on the market, HUD has some fabulous properties!  Newer and move in ready!  There are really some jewels!  They list properties typically on Wednesdays & Fridays.. and the bidding time varies.  It can be anywhere from a few days to a few weeks.

I suggest placing your bid on a home as soon as you know that you want it (of course after you have had the opportunity to walk through and asses the property).  Hud will take the highest & best bid, and in the case of a tie.. whoever bid first will typically win.  They are about business and impartial when it comes to these things.  So do not take it personal if you do not win the bid on the home you want.. just keep looking and bid on something else, and hey you never know, sometimes if the original buyer does not complete the purchase, HUD will place the home back on the market and notify your HUD broker that it is available again!

I encourage you to get an inspection after your offer is accepted. All HUD Homes are sold AS-IS, without warranty. HUD will not make repairs nor pay to correct any problems.  As a courtesy HUD will provide you their property inspection report done by their contractor.  It is a basic report to notify HUD about the general condition of the property as well as it helps HUD catagorize and price the property including figuring possible escrow repair costs.  HUD will not turn on the utilities for you.  You will have to contact all utility companies and get the utilities turned on in your own name for the inspections.  Yes, unfortunately that means you will have to pay any required deposits for this as well.  Please note, if you are purchasing a home during the winter months you will have to pay a de-winterization fee.  Typically $150 directly to HUD.  In the de-winterization process they pay a contractor to safely and securely drain the water from the home and shut off all utilites so that the home does not suffer any damage from being vacant.

If you elect not to get an inspection done on your home I strongly suggest getting a home warranty at closing.  These cost any where from $300 to $500 depending upon the coverage and the trip visit amount in case you have a problem.  But at least this will cover you in case of any major issues after you close.

Last but not least.. financing!  You must get an FHA loan to qualify for the program mentioned above.  You do not need FHA financing to purchase a HUD home, only if you want to take advantage of the $100 program!  I will be giving you more detailed information about FHA loans in a future article!
Thanks for reading!

HUD Home of The Day Only $100 Down Payment

Listing Bid at $98,000

This beautiful home is currently available in Henry County.  It was built in 2007 and has 5 bedrooms and 3 full baths.   What a great opportunity to move into a nice home. 

Homes listed by HUD have a Bidding period.  Basically meaning that they list the home on a certain date and then give prospective buyers any where from a few days to a few weeks to place a bid on the home.  You (via your HUD approved Real Estate agent) can bid any amount that you like however HUD is not obligated to accept the BID.  If you BID on a home that is a NEW listing for HUD and your BID is "acknowledged" meaning accepted by HUD you can receive a $1,000 bonus at closing if you plan on being an owner occupant. 

Once the Bidding has ended HUD will choose the highest and best bid.  Clients have asked me "what if my bid amount is the same as another buyer?"  HUD will typically resolve this issue by awarding the bid to whomever placed their bid first.  So even though the bidding period may end at a certain time & date.. you feel "what's the rush".. my suggestion would be to get your bid in as soon as you want the property, because you could lose it just because someone else placed their bid before yours!

Police Officers, Firefighters, Teachers can get up to 50% off a HUD home!

The Good Neighbor Next Door Program

Law enforcement officers, pre-Kindergarten through 12th grade teachers and firefighters/emergency medical technicians can contribute to community revitalization while becoming homeowners through HUD's Good Neighbor Next Door Sales Program. HUD offers a substantial incentive in the form of a discount of 50% from the list price of the home. In return you must commit to live in the property for 36 months as your sole residence.


How the Program Works

Eligible Single Family homes located in revitalization areas are listed exclusively for sales through the Good Neighbor Next Door Sales program. Properties are available for purchase through the program for five days.  You will have to check with your real estate agent

How to Participate in Good Neighbor Next Door

Check the listings for your state  you can go to http://www.bidselect.com/.  On Bidselect put in the state you are looking in, scroll to the bottom of the seach page and look for the Government Foreclosure Programs tab.  Then click on Good Neighbor Next Door.  This will populate all the homes available for this program in your State.  You will be surprised to see homes listed at $1.00    Yep, that is RIGHT!!  Only $1.00   Your agent must submitt a Bid for you anyway and remember there could be other buyers bidding so you are not guaranteed to win the $1.00 Bid, however HUD is basically stating the if you BID $1.00 and not one else bids.. hey the home will be yours!  Not a Bad deal!   Now if more than one person submits a BID on a single home, a selection will be made by random lottery (typically if the Bid amounts are the same.. if one bid is higher.. the highest & best will win). You must meet the requirements for a law enforcement officer, teacher, firefighter or emergency medical technician and comply with HUD's regulations for the program.  Hud has specific forms that you must sign verifying your status and you must plan on living in this home for at least 36 months, which is only 3 years... not bad!

HUD requires that you sign a second mortgage and note for the discount amount. No interest or payments are required on this "silent second" provided that you fulfill the three-year occupancy requirement.

The number of properties available is limited and the list of available properties changes weekly.

Gwinnett County Homestretch program gives you $7,500 at closing!

This Lawrenceville Home is HUD owned and only $129,000 it is almost brand new!

The Homestretch Program is one of many Gwinnett County Programs that you can use to purchase a home!  In this article I will explain the program and the process  to you!

First things first, you will have to get a prequalification with a lender of your choice.  Just make sure to ask your lender if they will participate in the Homestretch Program.  This program does not have preferred lenders, however it is best to check with the lender, especially if they are a Mortgage Broker, as some investors that the mortgage brokers use will not allow them to fund loans using some of these down payment assistance programs.

With your lenders blessing you will need to schedule an appointment to meet with one of the counselors at the Homestretch program itself.  They will go over the program and the application with you.  You will need to bring all documents that are required as it is similar to applying for loan.  They have income guidelines that they go by and will make sure that your income does not exceed their requirements depending on how many dependents you have and the total people living in your home.

Once this is complete and they have approved your application, you will be able to search for your home.  Now the great thing about Gwinnett County Homestretch Program is that you can use the $7,500 toward a Single family home or a Townhome.   Once you locate your desired home and you have successfully received an executed contract, you will need to submitt the contract to the Gwinnett County Homestretch program.  They will then secure your funds.  This is very important as sometimes this program runs out of funds.  The funds typically will be replenished however there is no particular timeline on the availability and they will not and cannot guarantee the funds will be available to meet your contract close date.
So make sure you turn your contract into the program ASAP to get your money.  The $7,500 can be used toward down payment, closing costs and pre-paid escrow items.   You will however have to contribute 1% or a maximun of $1,000 of your own funds towards the transaction and you will not be able to receive any cash back at the closing table.
Now the next issue is the inspection.  The Homestretch program requires you to obtain a home inspection at your own cost, prior to them sending our their Gwinnett County inspector.  They do have a list of guidelines that they look for in the home inspection and they will happily provide you a copy of their expectations at the time of your application.   A fixer upper home will not work for this particular program , unless you have all of your renovations completed before their inspector comes out to view.
Once your loan is 100% complete and underwritten approved from your lender, and your home has passed inspection & appriasal, then your file should be submitted to the Homestretch Program for review as well.  You can expect that process to take at least a week.  Be prepared for the fact that sometimes the Homestretch program will notify your lender that they have additional questions or that they may have other loan conditions that must be met.  If this occurs it will take afew more days for your lender to clear those additional conditions to get your loan approved.   Once your loan is approved by the program, your file goes back to your lender and they will be required to draw up a closing package to submitt to the closing attorney.

Once the closing attorney receives your loan package they will produce a HUD-1.  This is improtant, as it must go back to Homestretch for review in order for them to release your funds for closing.  A member of the Homestretch team will actually attend your closing to bring the check for $7,500 and to make sure their title requirements are met.

The Homestretch program, along with the other county programs require that you live in your home at least 5 years or you will have to pay them back the $7,500 at closing if it is prior to your 5 year anniversary of owning the property.

This program is a little more work, however it is well worth it if it is the difference between owning a home of your own or staying in that apartment!

If you need help and are in the metro Atlanta area please contact me, I would be happy to help!

All About the Dekalb County Down Payment Assistance Program $5,000 & $8,000

This Dekalb County home was listed at only $83,000.  Yep!  That's right!!! a 5 bedroom 3 bathroom home!!

And you could have bought it and received $5,000 to $8,000 from Dekalb county to make the purchase!  Dekalb County has a first time home buyer program that  will give you money to use toward the down payment of a home in Dekalb county only.  Now there are some guidelines, but that is what I am here for!  to walk you through the process so that you understand the requirements, are aware of what to expect and hopefully you will have a smooth transaction!

You can use the money toward your Down Payment, Closing Costs, or other pre-paid expenses.  If you begin the process and your credit score is below a 620, however with utilizing the counseling available, you raise your score over the 620 mark, then Dekalb county will increase your amount from $5,000 to $8,000!!  Now, keep in mind, this money will act as what is considered a "soft second mortgage" on your title.  You will have to live in your home for at least 5 years in order for that "soft second" to be released from your title.  Now you can move sooner if you have to, but please keep in mind that upon closing Dekalb county will expect their money back.

Now, moving on to the program.  There are income guidelines for the program and the home price can not be over $160,000.  The maximun annual income limits are $39,850 for a household of one and it goes up incrementally the more people in your home you have. 

You are eligible if you have not purchased a home in the last 3 years, and the home must be located in the county limits.  You will have to participate in a home ownership pre-purchase counseling, and the home you select must be single family.  Sorry, no townhomes nor condominiums ( basically due to HOA issues).  The home you select must also pass the Dekalb County home inspection, and let me tell you from experience... the home cannot be a fixer upper.  the dekalb County inspector is very meticulous and they will look at wobbly toilet seats and drain stoppers!  So the home must pass their muster!

1. Get a prequalification from a preferred lender.  Now I say preferred because they have a list of approved lenders.  this basically means that the lender has taken the class they offer to become familiar with the program expectations and how they can utilize the program.  This is very important.  Many lenders will tell you there is no money available to you simply because they do not want to be bothered with the additional work required to process your loan utilizing the program.  Keep in mind that there is double processing on as the lender will take your loan application , process your loan and after they are 100% done with your  file they have to send the entire package to Dekalb County for another underwriter to review it to make sure it qualifies for their funds.  This can honestly take some time.  they are meticulous and everything must be right or you can expect delays for sure!

2. Take the Required Homebuyer Education Seminar and then meet personally with a housing counselor for an individual counseling session.  This must be a counseling agency approved by Dekalb County.  The topics covered will be *how to get a mortgage *money for down payment * planning for home ownership responsibilites *evaluating your ability to afford a home * types of financing available * budgeting and credit * understanding your FICO score *avoiding foreclosure.

3. Search for your Home!  Once you have received a prequalification from a lender and you have completed your homebuyer education class and individual counseling session, you are ready to find your home!  You have many choices to make as there are many great deals to be had in the Dekalb County area!  Just keep in mind that it must be single family and priced under $160,000.   You can also choose a HUD home!  Be aware that some sellers may have had bad experiences with the down payment assistance programs and may not want to allow you to use them.  This typically occurs when the agent and lender are not familiar with the program, or the buyer enters into a contract PRIOR to applying for the program and meeting the program requirements.  I would also ask that the lender you are working with begin to process your loan application as soon as possible to avoid delays.

4. Upon contract acceptance, please make sure that the Dekalb County "Non Displacement Agreement" is a part of the contract paperwork.  Dekalb county must have this original form or they will not process your application.  You should immediately schedule your inspection.  You have to have your inspector come out BEFORE the Dekalb County inspector.  So basically your home will go through two inspection processes.  Let me tell  you, if the home is not right, they will not give you the funds.  The inspector will expect the home to have all utlities on and they will give you a list of items that need to be done in order for the home to pass the inspection.  You will have to have the items completed, if the seller will not before Dekalb County will come back out to make sure the items are done and give your home a "pass".  They will not release your down payment money until the home has passed inpection.

5. Your contribution - Buyers must have at least 1% of their own money in the transaction.  this requirement is typically fulfilled when you give your earnest money and pay for your appraisal.

Well once you make it through these steps congratulations!! You should be heading to the closing table!!  and if you are searching for a home in the Dekalb County area feel free to contact me, I would be happy to help you!

All things related to buying a home!

If you are looking for a home in the metro Atlanta area, you have many options. I am dedicating this blog to helping yo navigate your way through all of the information & misinformation out there regarding financing, credit, down payment assistance, HUD home purchase, home buyer education classes and many other issues and topics when it comes to getting into your home for as little money as possible.

I will also be addressing many issues regarding keeping the home you are in, including credit counseling, loan modifications, and if all else is not working.. what a short sale entails.

Well, there is a lot to talk about so lets get started!!