So with the foreclosure crisis not slowing down, U.S. Treasury officials are hoping new incentives will accelerate short sales and other alternatives to rescue homeowners.

While new incentives have been introduced, keep in mind that they don’t take effect until April 30, 2010. Effective that date, the government’s Home Affordable Modification Program (HAMP) will incentivize lenders to accelerate short sales or deed-in-lieus.

Certainly one of the most needed items is the guideline requiring lenders to consider borrowers for a short sale on their primary residence 30 days after missing two consecutive payments on a modified loan or after the borrower requests a short sale.

The MAHP will also be offering monetary incentives. It will pay up to $1,500 for a homeowner to relocate; $1,000 to lenders that accept a sale to cover processing expenses, and a maximum of $1,000 to help settle a second mortgage or subordinate lien. The Treasury plan requires that borrowers be fully released from future liability for the debt.

U.S. Treasury and bank regulatory officials say foreclosures are still greatly outpacing the alternative of short sales or deeds-in-lieu of foreclosure. For every short sale or DIL as of the first half of 2009, there were 23 foreclosures, according to the Office of the Comptroller of the Currency.

So what’s a short sale? In a short sale, the lender allows the borrower to list and sell the property with the understanding that the net proceeds from the sale may be less than the total amount due on the mortgage. While the lender is not actually a party to the contract to sell the home, any contract is contingeny upon the lender agreeing to not being fully reimbursed.

Deed-in-lieu of foreclosure is less common, but essentially the borrower voluntarily transfers ownership of the property to the lender to fully satisfy the total amount due on the first mortgage. The lender’s approval is contingent upon the borrower’s ability to provide marketable title, free and clear of mortgages, liens and encumbrances.

The new incentives are intended to simplify and streamline the use of short sales and DIL options by allowing the borrower to receive pre-approved short sale terms prior to listing the property, prohibits the lender from reducing the real estate commission, implement standard processes, documents and timeframes and provides financial incentives to borrowers, servicers and investors.

What the final outcome and how this program is received in the industry will only be determined in time. If you are a distressed Atlanta home, it is important to to work with an Atlanta Realtor, with the knowledge base and expertise to guide you through the process. Contact us to schedule a confidential consultation to assess your situation and determine how we can assist you.

As the foreclosure crisis appears to show no sign of slowing, the president wants to increase pressure on mortgage companies to help people remain in their homes.

A new program is to be announced and the goal will be to increase the rate at which distressed home loans are convereted into new loans with lower monthly payments.

The Treasury is also expected to announce that the loan modifications must be permanent before it will pay cash incentives to lenders that lower mortgage payments.

Industry officials said the new effort would include increased pressure on mortgage companies to accelerate loan modifications by highlighting firms that are lagging in that area.

Under the current $75 billion program, the Treasury awards lenders $1,000 initially — and $1,000 annually for up to three years — each time they agree to lower a troubled borrower’s payments rather than foreclose on the property. Those cash incentives come from the government’s $700-billion financial bailout package.

But critics say the incentives aren’t making enough of a dent in foreclosures.

Analysts said the foreclosure crisis is likely to persist well into next year as high unemployment pushes more people out of their homes.

A report last week from the Mortgage Bankers Assn. found that 14% of homeowners with mortgages were either behind on payments or in foreclosure at the end of September, a record level for the ninth straight quarter.

Rising foreclosures depress home prices and threaten the sustainability of the fledgling economic recovery.

The Congressional Oversight Panel, a committee that monitors spending under Treasury’s bailout program, concluded in a report last month that foreclosures are now threatening families who took out conventional, fixed-rate mortgages and put down payments of 10 to 20 percent on homes that would have been within their means in a normal market.

Contact us today to learn more about your options in avoiding foreclosure.

I always look forward to Thanksgiving every year. It’s time for some turkey, time to give thanks and time for some extra football. Thanksgiving time. It’s certainly a time of year when we get to spend time with friends and family and realize that we are fortunate.

But for some savvy shoppers, this is also the time of year to prepare to assault the stores on what has become known as Black Friday. Now while you may be looking to take advantage of the latest deals, keep in mind that not all deals are found in the stores.

For example, you can find lots of great deals online.

Another option is in the Atlanta real estate market. Home prices have been reduced, interest rates are phenomenal and if you’re a first-time homebuyer you can qualify for $8,000 and if you’re a move-up homebuyer you can qualify for $6,500.

These kind of deals are going to be hard to beat in the stores or even online. To make your Black Friday shopping spree, easier, we’ve compiled up-to-date lists of Atlanta short sales as well as foreclosures in Atlanta. We’ve also broken the list down to include some other popular communities in metro Atlanta.

If you’re interested in taking advantage of the Sandy Springs Black Friday deals in the real estate market, be sure to contact us for your free buyer consultation.

What is this great news you might ask?  The first-time homebuyer tax credit has been extended and expanded.

What this means is that homebuyers have a chance to not only get a great deal on a short sale or a foreclosure, but they will also receive an extra bonus; for first-time hombuyers a tax credit of up to $8,000 and for homeowners that have owned a home for the past five years a tax credit of up to $6,500.

Do not hesitate, but act now and invest in a short sale or foreclosure and start building your equity today!

Contact the H2 Realty team to setup a time to view the short sales and foreclosures in Atlanta.

The House of Representatives overwhelmingly passed a bill today that would extend the $8,000 first-time homebuyer tax credit to home purchases under contract by April 30, 2010 and closed by June 30, 2010. This is an extension of the credit that was set to expire on November 30th.

This is the same bill passed by the Senate on Wednesday and could be signed by the President as early as Friday.

The bill also creates a $6,500 credit for those who buy a home after living in their current house at least five years. These homes would also need to be under contract by April 30th and closed by June 30th.

The credit would be available only for the purchase of principal residences priced at $800,000 or less.

The bill also raises the adjusted gross income cap to $125,000 for single filers and $225,000 for joint filers. The amount of the credit currently begins to phase out for taxpayers whose adjusted gross income is more than $75,000, or $150,000 for joint filers.

This is a great opportunity for first-time homebuyers and move-up homebuyers and we’ll be discussing the value and opportunity for both of these targeted groups.

This is an advantage for buyers who are looking for Atlanta short sale and Atlanta foreclosure deals as it buys them the time necessary to find the perfect home and get it closed. Contact us if we can be of assistance in finding some great opportunities in the Atlanta short sale and foreclosure market.

With homebuyers rushing to complete their home purchase before the first time home buyer tax credit expires, a report Friday is expected to show strong September sales.

Home resales are expected to show an almost 5 percent increase to a seasonally adjusted annual rate of 5.35 million, up from 5.1 million in August, according to economists polled by Thomson Reuters. If the report meets forecasts it would be the best month for home sales in more than two years.

The National Association of Realtors’ report is scheduled for 10 a.m. EDT.

First time homebuyers and investors both are taking advantage of the low mortgage rates, short sales, foreclosures, and overall discounted homes.  The buyers are also eligible to take advantage of the tax credit of 10 percent of the sales price, up to $8,000 so long as the sale closes by November 30, 2009.

With concerns about the housing market still prominent, Congress is considering several proposals to extend the tax credit for first-time buyers. Senators Johnny Isakson, R-Ga., and Christopher Dodd, D-Conn., want to extend it through June 30, and expand it to include all home buyers, at an estimated cost of $16.7 billion.

One potential roadblock, however, emerged this week. There are concerns that some of the 1.5 million applications for the tax credit are fraudulent.

At a hearing before a House subcommittee Thursday, J. Russell George, the Treasury Department’s inspector general for taxes, questioned the legitimacy of some 100,000 claims for the credit, potentially including some illegal immigrants and 580 people under 18. The youngest taxpayers to apply for the credit were 4 years old, his office said.

While the program has widespread support in Congress, there are growing concerns about the costs. The cause, said Sen. Jack Reed, D-R.I., “is a worthy one.” But “I hope we can find ways to pay for it.”

An often overlooked FHA loan  will allow buyers to not only purchase foreclosures but it will also pay for repairs and upgrades.

The FHA’s 203(k) program has been on the books for decades but over time it’s been rarely used. That’s changed recently, in part because the program is ideal for many foreclosure buyers.

With the 203(k) program buyers can get financing to purchase or refinance an existing home (it has to be at least a year old) plus additional dollars to fix it.  The construction money is provided in draws as the repair work is completed after closing.

This program, of course, works perfectly for foreclosure buyers because it covers both the cost of acquisition as well as the expenses that may be required to improve the property’s condition.

In order to qualify, buyers must reside in the property…therefore it must be a personal residence or an investment with multiple units and the buyer must reside in one of those units.

A benefit of the 203(k) program for those wanting to repair a home is that they can use one loan vs two which keeps the overall cost cheaper as there is a single settlement and thus only one set of closing costs, origination fees, taxes, etc.

Not all improvements can be financed under the program and the maximum available for repairs in $35,000.

For more information regarding the 203(k) program, contact us and we will put you in touch with one of our preferred lenders specializing in this program.

Nearly 10 percent of Georgia mortgages were past due in the second quarter, according to the Mortgage Bankers Association.  Making Georgia one of the highest delinquency rates in the country.

And the number of properties scheduled to be auctioned on the courthouse steps Tuesday hit 9,930 for a 13-county area of metro Atlanta, according to Alpharetta-based Equity Depot.  That’s the third highest total on record, according to Equity Depot.

Last year, scheduled foreclosures never broke 8,000. This year, the total has exceeded 8,000 in every month but one, according to Equity Depot data.

In August, Gwinnett County led the pack with 2,120 foreclosure notices. It was followed by Fulton (1,929); DeKalb (1,571); Cobb (1,107); and Clayton (785).

If you have a question about foreclosure or how to avoid it by short selling your home, please submit it below.  One of our Certified Distressed Property Experts will contact you.

What’s a Foreclosure

Foreclosure is the process whereby the lender takes possession of the property.  A foreclosure terminates all rights of the homeowner covered by a mortgage.  Foreclosure is the process in which the estate becomes the absolute property of the lending institution.

When a homeowner fails to make the payments on their mortgage, the lender can begin foreclosure proceedings. This is a very specific legal process with set timelines and outcomes. In a Short Sale situation, the home owner’s name is still on title of the property and they are the official owners who are trying to sell the property. In a foreclosure, the lender takes possession of the house and as a result, the homeowner is no longer a party in the sale.

Foreclosure my pose potential problems such as: Title problems, Superior loan pay offs, IRS liens, tenants or owners still occupying the property, and/or structural problems.

What’s a Short Sale

Short sales occur when the current value of the home is less than the debt owed to the lender.  It occurs when a lender agrees to take less than the full loan payoff from the homeowner. The seller must demonstrate to the lender that they have a financial hardship and are unable to fulfill their mortgage repayment obligation.  In most cases, the owner is in default and is not making their payments for whatever reason.

Short sales, in most circumstances, are the first step to avoid foreclosure. Although the lender(s) will recover less than the total loan amount in a short sale, they may prefer this in lieu of foreclosure. The costs of foreclosing on a property may be more than the bank’s loss by taking a short sale. Also, the property may not sell at auction and then the bank would be forced to take it back as an REO (Real Estate Owned) property, which then they would have to maintain, list and sell themselves.

Something to keep in mind, the lender is under no obligation to grant a homeowner a short sale and in most cases it can be a frustrating process to get approved for one.  A Certified Distressed Property Expert, however is trained to help you with the process.

Banks are overwhelmed with short sale requests and the approval process can take months. Each bank evaluates each individual request on a case by case basis. Many times there is more than one lender involved. Not only do the banks consider the borrower’s personal and financial situation, but they also consider an appraisal of the property, market conditions, the banks financial situation, their current portfolio and in many cases have to consult with an outside investor who purchased the loan at some point. Given all of these varying circumstances, you can imagine why this process takes so long.

According to RealtyTrac’s Midyear 2009 Metropolitan Foreclosure Market Report, metro Atlanta ranked 35th for its rate of foreclosures at the halfway point of 2009.

Metro Atlanta had a foreclosure rate of 2.02 percent which translates to one in every 49 houses during the first half of 2009…a total of 42,799 foreclosure filings – default notices, auction sale notices, and bank repossessions.  Compared to the first half of 2008 the foreclosure filings jumped a total of 11.5 percent.

The 10 metros with the highest foreclosure rates, in order, were Las Vegas; Cape Coral-Fort Myers, Fla.; Merced, Calif.; Riverside-San Bernardino-Ontario, Calif.; Stockton, Calif.; Modesto, Calif.; Bakersfield, Calif.; Vallejo-Fairfield, Calif.; Phoenix-Mesa-Scottsdale, Ariz.; and Orlando-Kissimmee, Fla.