Q&A: How To Rent Your Home From Fannie Mae

Q&A: How To Rent Your Home From Fannie Mae

Fannie Mae announced Thursday that it will let troubled homeowners rent their homes instead of losing them through foreclosure and eviction. The new program is aimed at providing greater home security to distressed borrowers who can’t afford their mortgage payments and can’t get a loan modification, but would be able to afford the rent.

The program is structured so that borrowers transfer their property deed to Fannie, a process known as a deed-in-lieu of foreclosure. A deed-in-lieu will ding a borrower’s credit score, but it isn’t as damaging as a straight-up foreclosure, even though the end result is the same: Fannie gets back the property. Fannie completed around 1,200 deed-in-lieu transactions during the first half of the year.

In the new “Deed for Lease” program, borrowers must qualify for a deed-in-lieu under Fannie’s current guidelines, and if they can demonstrate that they have enough income to pay a market rent, they’ll be able to sign a lease for up to 12 months. Here’s a few question and answers about the program:

The Economy May Be Recovering, But Miami’s Foreclosure Mania Isn’t Close To Over [South Florida]

The Economy May Be Recovering, But Miami’s Foreclosure Mania Isn’t Close To Over

Riptide was feeling all warm and fuzzy this morning. No, it wasn’t just from all the vodka in our coffee. (What, like you don’t start your day with a little ‘Russian java’?)

The latest employment numbers came out this morning, and it looks like our Kanye-on-the-VMAs-esque disaster of an economy is finally on the rebound. The ArmaRecession may finally be hitting rock bottom. Yay!

But then we talked to Peter Zalewski, head of Condo Vultures and both Riptide and Michael Moore’s favorite messenger of doom on our housing market. Zalewski just released some new foreclosure numbers for the area, and damned if they didn’t sober us right up out of our Moscow espresso haze.

On average, South Florida lenders filed foreclosure papers on 272 properties every single day last month, according to Zalewski’s research.

Consider these factors before refinancing your home

Consider these factors before refinancing your home

Dear Liz: When does it make sense to refinance a home? I have a 30-year, fixed-rate jumbo loan. The loan is just over 2 years old with a rate of 6.5%. Should I refinance to 5.75% with zero points? I make extra payments every month with the intention of paying the loan off in 15 years, but I don’t want to be locked into a 15-year rate in case I have some difficult times.

Answer: There are no hard-and-fast rules about when to refinance. When refinancing costs were higher, you typically needed a 2-point drop in rates for a new loan to make sense, but that’s no longer true.

Generally, though, you should avoid refinancing if the new loan wouldn’t recoup its costs within two years. Although the loan you’re considering doesn’t charge “points” — a percentage of the loan paid to lower the interest rate — you’ll still be charged other fees. If the lower payments would offset those fees within 24 months, and you plan to stay in the house at least that long, you might consider replacing the loan.

Mortgage modifications are becoming more common, and more lenient

Mortgage modifications are becoming more common, and more lenient

Banks and mortgage companies have foreclosed on 5,000 residential properties in the St. Louis region so far this year. But a growing number of homeowners are managing to save their houses by convincing lenders to cut their monthly payments.

Borrowers just shouldn’t expect an easy time.

“Mortgage modifications” are becoming more common, and more lenient, although bottlenecks at mortgage servicers continue to frustrate homeowners. Many still are rejected and sent to foreclosure.

Latoya Williams is one of the lucky ones.

The Coming Home-Tax Credit: Worth the Wait?

The Coming Home-Tax Credit: Worth the Wait?

In a bid to give another shot in the arm to the housing market, Senate Democrats reached an agreement on Wednesday that would extend the $8,000 first-time home buyer tax credit and introduce a new credit for existing homeowners. This is a tentative compromise worked out by some Senate members and the specifics could still change.

If the measure passes, homeowners would be eligible for a credit of up to $6,500 if they have lived in their prior residence for five years. The credit would apply to home purchases under contract by April 30, 2010 as long as they close by June 30. First-time buyers would continue to be eligible for up to $8,000.

As for income limits, the new credit would be available to individuals earning up to $125,000 or couples earning $250,000. That’s up from $75,000 and $150,000, respectively, for the current tax credit, which is set to expire on Nov. 30.

Foreclosure properties worth a look

Foreclosure properties worth a look [Florida]

People wanting to buy homes in Charlotte County are looking in all the usual places — and then some.

Many of the county’s foreclosure properties on the Multiple Listing Service have become places where home seekers turn. There are certainly enough of them to see. As of Monday, Port Charlotte had 442 bank-owned properties, North Port 321 and Punta Gorda had 172, according to RealtyTrac.com.

The listings are not discriminatory: beautiful spreads at exclusive locations, higher-end homes in gated communities and middle- to lower-end places in single-family neighborhoods. No demographic has been unaffected.

“The foreclosure market has spawned a whole market of new buyers,” said Jim Thiel, a Realtor at Century 21 Sunbelt Realty in Punta Gorda. “It seems like I have a lot of customers interested in the foreclosure properties. A lot of them when they come in, they specifically indicate that is the type of property they want to buy. They know there is some obvious value.”