Does Credit Repair For Homebuyers Really Exist?

Posted on May 15, 2013 Written by Leave a Comment

I have long advised my friends and customers to consider working with a company that provides credit repair for homebuyers.

With the thousands of closings of short sales in Tallahassee over the past few years, there is a huge back-log of people who historically had great credit but now are dealing with below-average credit scores. The Tallahassee real estate market needs solutions, and I get a lot of questions these days about how to fix a poor credit score.

But the question that I most often hear when I recommend using a company that provides credit repair for homebuyers is … “do they work?”

Well, I’m not sure.

So I have decided to perform a real, live case study that will report on a client of mine (name hidden) who is attempting to repair credit that was destroyed through tough financial times and a short sale several years ago!

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Filed Under: Glossary of Real Estate Terms, Mortgage / Finance Tagged: , , , , ,

How To Measure The Cost Of Money In Real Estate

Posted on March 21, 2013 Written by Leave a Comment

Most people understand the significance of cost trends for sticks, bricks, land and labor, but the cost of money in real estate has a far larger impact on a family’s budget than do the other major items in a home purchase.

Whether you are building a new home or buying an existing home, odds are good that you plan on borrowing the majority of the money to make the purchase. Do you have any idea what the cost of money is going to be, and how potential changes in interest rates could change your financial position?

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Filed Under: Advice: Real Estate, Mortgage / Finance Tagged: , , , , , , ,

Foreclosure Sales: Don’t Be So Sure About Your Closing Date

Posted on July 26, 2012 Written by 2 Comments

There is a problem brewing with foreclosure sales that has become evident at many of the closing tables across the US.

In fact, Lawrence Yun, Chief Economist for the National Association of REALTORS, pointed to closing delays in foreclosure sales as one of the reasons that existing home sales fell in June.

But why do simple closing delays matter?

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Imagine that you are starting a new job on October 1st, and you want to buy a home in Tallahassee and close on it near the end of September.

You really do not want to be burdened with housing and moving issues while trying to learn a new job, so your closing date is important to you. Additionally, the best loan deal requires you to lock into your expected closing date.

Due to the urgency of closing within the next 60 days, you choose to forgo short sales as you understand the low likelihood of closing one sixty days after the date of contract. But certainly foreclosure sales are known to be quick to close, right?

So you find some great foreclosure sales on the list of distressed properties in Tallahassee, and you immediately put one under contract with a healthy 60 day period for closing. Your lender locks you in to an incredibly low rate, and you proceed forward happily knowing you have solved your housing problems.

Imagine your horror when you are told, usually just days (or hours) prior to closing, that there is a problem and the closing date will not be met.

How does this affect some important things like:

  • Your family’s move schedule
  • The moving van with your possessions arriving from your previous home
  • The lock-in period and the money you spent on it
  • The WDO inspections and their validity dates
  • Your ability to focus on your new job

These are just some of the irritating and costly problems that you will likely encounter when the new foreclosure sales bomb hits you days before closing.

New Delays Seen In Closing Foreclosure Sales

Foreclosure Sales Delays Century 21 Manausa and Associates 1140 Capital Circle SE #12A Tallahassee, FL 32301 (850) 366-8917 www.manausa.comSo what is happening now that did not occur very often in the past?

According to Lawrence Yun, the problem is that closing attorneys and title companies are just making sure to “dot the i’s and cross the t’s,” but I find it remarkable he doesn’t see the real issue.

First of all, closing attorneys and title companies have always been concerned about correctness, and they always will be. This is not what is causing the delays.

The real culprit here stems from the law firms that became foreclosure factories several years ago and have been doing a high volume of shoddy work. Included among them are the ones that were responsible for the robo-signing scandal that put the brakes on foreclosure sales in the past.

The current problem that title companies and law firms are dealing with is the poor chain of title and/or mistakes in the mortgage assignments that were produced by these foreclosure factory law firms.

If they missed something along the way, then the chain of title is in question when it arrives to your closing agent/attorney. A prudent attorney is not going to overlook these uncovered issues with the title, and thus it will take additional time to resolve the problems.

Unfortunately, the only way to resolve most of these problems requires involvement from the previous law firm (think foreclosure factory). Unfortunately, these firms are running on thin margins and they no longer care about past transactions. It is like pulling teeth to get simple title defects resolved.

This is a problem that will be growing as foreclosure sales take over the Tallahassee real estate market.

Safely Buying Foreclosure Sales

So how do you go about buying foreclosure sales and avoid closing delays that can cost you tens of thousands of dollars?

First of all, work with an expert real estate agent. They will be problem solving even before you put a home under contract, doing everything possible to help you avoid the problems and pitfalls of buying a property with title defects.

Secondly, through the guidance of your real estate agent, give yourself enough time to close on the property. If you absolutely have to be in a home in a short period of time, then property selection needs to consider the capabilities of the current owner.

If you are planning to buy a home and want expert guidance, simply drop me a note and we can schedule a time for an initial consultation that will ensure that you get started off in the best manner possible when pursuing foreclosure sales, short sales, or even arms length home sales.

Filed Under: Mortgage / Finance Tagged: , , , , , , , , ,

Cash For Real Estate

Posted on December 23, 2011 Written by Leave a Comment

With all the problems that we read about obtaining financing for real estate these days, it has raised some discussion about just paying cash for real estate. Tallahassee has never been a town filled with people with a lot of excess cash, so I really don’t see a new trend towards cash buyers starting any time soon.

Of course, if home prices continue to fall as we expect, there will be more cash-laden investors who come to claim real estate investments in Tallahassee.

Yesterday, I received some feedback and conversation about the article on Foreclosures that I wrote from Sarasota real estate agent Keith Kropp, who shared this interesting statistic:

I’m also concerned about the high level of cash sales. In both the Orlando and Sarasota markets, cash sales are accounting for 60% of all sales. This is unbelievably high, and I don’t know how long this trend can continue.

Whoa, 60% of all buyers are paying cash for real estate in the Orlando and Sarasota markets? That is very hard to believe. So what’s the story in Tallahassee?

Cash For Real Estate In Tallahassee

In order to determine how many people were paying cash for real estate in Tallahassee, I studied all recorded arms length sales of single family detached homes, condominiums, and townhouses in Leon County, Florida. What I found was not surprising.

Cash For Real Estate In Tallahassee

As we can see in the real estate graph above, the percentage of buyers who are paying cash these days has doubled from our traditional rate of about 15%, to a whopping 33% in 2011. So is paying cash for real estate a new rising trend, or is there a simple explanation for what we are seeing?

Cash Buyers In Tallahassee Real Estate

This graph shows that the number of people who pay cash for real estate in Tallahassee has remained fairly consistent. The reason that we see the percentage doubling is because the market is performing at only half the rate of home sales that we normally see. So I believe this is fair evidence to support that cash buyers have not left the market, rather it is those buyers who are borrowing money that have been most effected.

So which loan product out there has caused the most chaos in the Tallahassee housing market?

Conventional Loans Tallahassee

This graph shows that convention loan products are the real story here. Tallahassee was recording nearly 2,500 conventional loans for purchase by the end of the 1990s, yet this year we will only see about 1/3rd of that amount. This is just a normal corrective phase that was needed due to the crazy lending practices from 2004 through 2006. This too shall pass.

If you are interested in buying a home and want to take advantage of our free mortgage counseling services, just drop me a note (<- By clicking that link) and we’ll schedule you to meet with an expert to help you determine your best home purchasing solution. Whether or not you plan to pay cash for real estate in Tallahassee, you should understand all of your options and opportunities in order to get the absolute best deal in today’s housing market.

Filed Under: Mortgage / Finance Tagged: , , , , ,

The Shocking Truth about Foreclosures And Deficiency Judgments

Posted on December 13, 2011 Written by 2 Comments

Apathy Leads To Mortgage Foreclosure Deficiency JudgementsThere is a real danger lurking around homeowners all over the country, and this malicious entity often leads to mortgage foreclosure and deficiency judgments. Is it a new bank? A new government program hiding behind the facade of a homeowner assistance program? Perhaps even a loan modification organization that caters to homeowners in distress …

No, the real danger to homeowners who need to sell a home is apathy. It occurs after a homeowner has been attempting to sell a home at a price higher than the market will bear but before they are able to close on a short sale that would save the property from going to foreclosure.

This apathy, this feeling that it simply does not matter anymore, often motivates homeowners into abandoning the home and letting the bank foreclose. It often seems like the easiest thing to do. And since some banks are slow at processing foreclosures, it could mean living in your house for several months before you’re required to move out.

Deficiency JudgmentsBut there is a dark side to that plan. It’s called a deficiency judgment.

A deficiency is the difference between what you owe at the time of foreclosure, and the dollars the bank gets after selling the house and deducting all the fees and costs. That includes attorney fees, asset management fees, maintenance and utility costs, repair costs, and selling costs.

Banks can decide to sue for a deficiency judgment at a time most convenient to their agenda, so often it does not occur immediately after the foreclosure sale. And while the subject may not come up during the foreclosure, it doesn’t mean you’re off the hook. They may wait to sue until it appears that you’re back on your feet and have the ability to pay.

Here in Florida, banks can wait up to 5 years before filing suit for the deficiency. And then, once they have a judgment, they can pursue you for collection for 20 years. That’s way too long to have a huge debt hanging over your head!

The only means to avoid a deficiency judgment are through bankruptcy or effective negotiation with your lenders like we do during a short sale.

Not All Short Sale REALTORS® Are Alike

Should I Short Sale My Home e-BookUnfortunately, avoiding a deficiency judgment isn’t an automatic result of a short sale. Unless your listing agent is a seasoned veteran of the short sale process or works with an attorney who has handled short sales with all the different lenders, you might still find yourself liable. And unless your real estate agent knows how to find the “small print” in the bank’s paperwork to be sure your liability has been released, you could be in for a nasty surprise years after you think that episode in your life is over and done with. Can you imagine still dealing with this home loan 25 years from now?

Thus, eliminating the possibility of a deficiency judgment is one of the most important tasks I perform for my clients. I have a full-time employee/agent dedicated to assisting me to help people get out of the jamb that their home loan has caused, and we are ready to help you determine your best course of action. I strongly encourage you to read my 86 page e-Book titled “Should I Short Sale My Home?” It is filled with information that many homeowners have found to be enlightening.

If you’re thinking of a short sale, just drop me a note and we can schedule a time to review your own personal situation. Everybody’s is different, and we’ll use our experience to help you make a decision best for you and your family. I’ll be happy to explain the entire process and answer your questions.

Filed Under: Advice: Real Estate, Mortgage / Finance Tagged: , , , , , ,

The USDA Rural Development Loan Is A No Money Down Solution

Posted on November 15, 2011 Written by 2 Comments

USDA Rural Development Loan Tallahassee FloridaAre you somebody who has decent credit but very little cash, and you want to buy a home in Tallahassee? In the old days, there were many ways to solve this problem. During the housing boom, you would have plenty of options when it came to financing a home, but today, no money down programs are few and far between, so the cash-strapped homebuyer needs to explore all the options.

Recently, Robert Barnette of Hancock Bank, came and met with our office to discuss different loan programs and trends in the mortgage industry in Tallahassee. He addressed buying homes that need rehabilitation (How To Buy A Home That Needs Repairs) and he discussed the USDA Rural Development Loan. As we previously covered the former, today’s real estate blog will focus on the latter.

The USDA Rural Development Loan Around Tallahassee

As you might suspect from its title, the rural development loan is not available in all areas. The purpose of the loan is to provide home purchasing assistance in rural areas, and you can read all about it on the USDA website. Instead of going through hundreds of pages on its website, we have provided a summary of what you need to know and a map of areas included in the USDA Rural Development Loan program for Tallahassee and Leon County, Florida.

Eligibility For The USDA Rural Development Loan (Tallahassee MSA)

There are two areas of qualification review that must be done to find out if a homebuyer in the Tallahassee area can get a USDA Rural Development Loan. First of all, the buyer must have the financial qualifications for the loan, and secondly, the property must also qualify for the buyer to take advantage of this government sponsored no-money-down loan program.

Borrower Eligibility – The USDA Rural Development Loan program is for people with household incomes below $74,050 ($97,750 for households with 5 or more people). If a homebuyer has a credit score below 640, the lender might be able to push the loan through providing the borrower has strong compensating factors. If the borrower’s credit score exceeds 640, then credit scoring will not be an issue. The buyer must also qualify with debt ratios that are similar to other loan programs and he or she does not have to be a first time homebuyer. The buyer cannot own another home in the Tallahassee MSA, and the home needs to be purchased for occupancy (cannot use the USDA Rural Development Loan for purchasing investment property).

Property Eligibility – The buyer must choose to purchase a single family detached home or an approved condominium, as mobile homes, duplexes and farms are excluded from the USDA Rural Development Loan. To verify whether or not the property is in an approved area, just use the map below to ensure that it falls within an eligible area. (Email subscribers: If you subscribe to the Tallahassee Real Estate Blog by email, you will need to click through to the internet to use the map).

Tallahassee USDA Rural Development Loan Map

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This overview of the USDA Rural Development Loan for the Tallahassee MSA is just an overview, and borrowers should speak with a mortgage expert to determine whether or not they qualify for the loan.

Filed Under: Mortgage / Finance Tagged: , , , , , ,

How To Buy A Home That Needs Repairs

Posted on November 14, 2011 Written by Leave a Comment

Buy A Home That Needs RepairsIf you are looking to buy a home that needs repairs, then you most likely have found plenty of opportunities in a housing market that is recording a record number of distressed property sales. But if you are not a cash buyer, then you most likely have also run into some difficulty in figuring out how to finance your purchase.

The days of easy loan programs that could solve these problems is over, and you have to know exactly what to do when you structure a contract to buy a home that needs repairs. Unless you plan on paying cash for the repairs, you must think-through the structure of your offer and communicate clearly with your chosen lender. Not all mortgage loan providers have products to fit your needs, so make sure you address this with your real estate agent before you begin the home selection process.

This is a good reason to ensure that you are working with a well-trained real estate agent, because if your agent is not up-to-date with the most recent lending programs, you will end up either spending more cash out of pocket, or losing the home to a buyer who has the better real estate agent who can structure a deal that can be financed.

Common Issues When You Buy A Home That Needs Repairs

There are so many short sales, foreclosures, and REO properties on the market, that necessary repairs are not uncommon when you select a home for sale in Tallahassee. Often times, these repairs can cost a significant amount of money, so you have to know how they will be addressed in the sales contract, who will pay for them, and which ones your lender will allow to be repaired after closing (by using a repair escrow with your real estate attorney).

Likely Acceptable Items When You Buy A Home That Needs Repairs

Most lenders who allow for repair escrows maintain a list of things that they will allow to be escrowed, and the following list was given to me by Robert Barnette at Hancock Bank. His bank allows these items to be included in a repair escrow when you buy a home that needs repairs.

  • Roof repair or replacement
  • HVAC repair or replacement
  • Replace missing appliances
  • Peeling Paint
  • Non-structural wood rot damage
  • Installation of new flooring
  • Repair or replace pool equipment or liners

Non-Allowable Repairs For Inclusion In A Repair Escrow

Here are some common repairs that need to be addressed prior to closing, as most lenders will not allow a closing to occur without these first being fixed:

  • Full remodels of kitchens or bathrooms
  • Structural damage
  • Repairs taking longer than 2 weeks
  • Landscaping or yard equipment replacement or repair
  • Furniture
  • Damages exceeding $10,000 (with the likely exception of roofs and HVAC)

Final Tip On How To Buy A Home That Needs Repairs

After reading through this, you can see that experience matters! Choose your real estate agent and your mortgage lender before you start looking at homes, that way you will have a prepared team working for you should you decide to buy a home that needs repairs. If you plan on buying a home in Tallahassee, just drop me a note and we’ll schedule a time to meet and get you started on your way.

Filed Under: Advice: Real Estate, Mortgage / Finance Tagged: , , , , , , , ,

Is A Mortgage Assignment Sale The Solution For Buyers With Bad Credit?

Posted on September 1, 2011 Written by 2 Comments

Mortgage Assignment SaleI was reading a blog post this morning from another real estate agent who was seeking input about a mortgage assignment sale (creative solution for homebuyers with bad credit that involves the assumption of existing loans). It simply involves the seller granting the deed of the property to the buyer subject to the existing liens on the property.

The topic of mortgage assignments is very hot among real estate investors, with many claiming the mortgage assignment sale as a great way to acquire a lot of property with very little money. If the seller is willing to pay closing costs, the whole thing could be done “no money down.” But even if the buyer had to pay the closing costs, it would take 10% or less to acquire the property. Seems like a great way to sell property, right?

Note: Did you subscribe to the Tallahassee Real Estate Newsletter? It’s free and it contains great information for home sellers and buyers alike. Join the thousands of people who get the best analysis of the real estate market emailed to their inbox on the third Monday of every month, featuring charts, graphs, and analysis of the Tallahassee real estate market.

A simple example of a mortgage assignment sale would a property owner who owes $240,000 on a home. A contract would be written for an amount that would include closing costs and the $240,000 owed on the property (most likely around $265,000). The buyer would bring $25,000 to closing and then would assume payment’s on the loan of $240,000. The seller would be assigning the mortgage to the buyer, but herein lies the problem.

Beware The Perils Of A Mortgage Assignment Sale

The lender in most cases will not be made aware of the assignment, and therefore can call it due at any time. With times being what they are, most banks will be happy with a current loan and most likely will do nothing about this assignment (for now), but they still have the right to do so in the future. Imagine the buyer owning the property for three years, staying current on the loan the whole time, and then receiving a letter stating that the loan is being cancelled (called due) immediately. The bank would have this right.

The buyer would be faced with four options.

  1. Negotiate with the bank for a loan modification
  2. Refinance the property with another lender
  3. Sell the property
  4. Be foreclosed upon

Of course, if a buyer goes into this with poor credit, it might be a risk worth taking. After purchasing a property through a mortgage assignment sale, the buyer would only be at risk for losing the equity gained and the initial investment, and if this was “no money down,” there is not a whole lot to risk. But what about the property seller?

Mortgage Assignment Sale Sellers Still At Risk

Since the banks will not be releasing the seller of liability at closing during a mortgage assignment sale, the seller will be “on the hook” the entire time the mortgage remains on the property. Without a novation, the lender will still be looking at the seller for satisfaction. That means if a poor credit buyer purchases the property through a mortgage assignment and then defaults, the seller is the one who will bear the foreclosure process or other remedy resulting in the bank calling the note due.

I cannot imagine a situation where the seller should be comfortable with a mortgage assignment sale. Seller’s who are faced with a tough time selling their home have better options, and many of these sellers should consider a short sale, as it gets the property sold and these sellers can move on with their lives.

Mortgage Assignment Sale Advice

If you own a property and are presented with an offer involving a mortgage assignment, you should seek advice from a Florida Real Estate Attorney. The strength of the buyer should weigh heavily on your willingness to take this risk, and most likely there are wiser remedies for you to pursue. Of course, if you receive an offer from a buyer pursuing a mortgage assignment sale, it wouldn’t hurt to request the bank’s approval for the assignment, and thus removing the seller from the loan.

Filed Under: Advice: Real Estate, Mortgage / Finance Tagged: , , , , , ,

How Far Under Water Is The Tallahassee Housing Market?

Posted on June 13, 2011 Written by 2 Comments

Underwater HouseAre you under water in your house? You might be surprised at just how many homes in Tallahassee have larger debt loads than their value. This topic came up in a comment made by a reader last week, so I thought it was worth further exploration.

When we say that a house is under water, all this means is that the owner owes more money on the house than could be gained through a sale. So just how do we estimate the number of underwater homes in Tallahassee?

Last week, a regular contributor “Patrick” commented:

I’ve been watching your recent charts with interest. Based on the price declines, it looks like anyone in Tallahassee that bought or refinanced a home in the past 5 years is underwater.

Nobody has equity to move, either up or down. It’s hard to spot a bottom at this point. Truly a buyer’s market, with only the most unique or desirable properties getting a look. I think your 5-7 year prediction is dead on.

So let’s sort this all out.

How Many Under Water Houses Are In Tallahassee

Underwater Houses In Tallahassee

The real estate graph above shows that every home purchased in the years shaded by the arrow are most likely under water, unless of course they have already since been sold. The 29,509 homes that are upside down on the mortgages represents about 10 years of supply at our current rate of demand, and this does not even include the homes that were refinanced during the same time period.

You might be surprised at the amount of information that went into showing how many homes are underwater in Tallahassee. To create the graph above, I calculated the average purchase price each year (using historical appreciation rates) and then I calculated the equity in each home. Additionally, I used sales data from the Leon County Tax Appraiser’s office which records the first and second mortgage amounts at closing.

I then segmented the homes into three groups by average combined loan to value (CLTV), and then used historical records on mortgage interest rates to calculate the current equity in each home. Then, using average closing cost data, I determined the number of homes that were most likely underwater. The following table shows the results.

Current Equity Number Of Homes Purchased Total
Year Value 95% LTV 85% LTV 75% LTV 95% LTV 85% LTV 75% LTV Under Water
1991 $165,000 $99,847 $104,968 $110,090 1,642 517 2,100 0
1992 $165,000 $95,842 $101,385 $106,928 1,755 600 2,175 0
1993 $165,000 $91,299 $97,320 $103,341 1,683 646 2,534 0
1994 $165,000 $83,257 $90,125 $96,992 1,809 751 2,564 0
1995 $165,000 $77,129 $84,641 $92,154 1,790 691 2,655 0
1996 $165,000 $64,120 $73,002 $81,884 1,710 664 2,591 0
1997 $165,000 $65,394 $74,142 $82,890 1,692 645 2,382 0
1998 $165,000 $58,954 $68,380 $77,806 1,674 747 2,699 0
1999 $165,000 $44,134 $55,120 $66,106 1,682 787 2,838 0
2000 $165,000 $39,164 $50,673 $62,182 1,741 812 2,678 0
2001 $165,000 $39,700 $51,152 $62,605 1,856 920 3,017 0
2002 $165,000 $24,948 $37,953 $50,959 2,126 1,089 3,195 0
2003 $165,000 $9,959 $24,543 $39,126 2,417 1,242 3,436 0
2004 $165,000 ($9,278) $7,330 $23,938 2,702 1,464 3,491 2,702
2005 $165,000 ($36,109) ($16,676) $2,756 3,033 1,572 3,771 4,605
2006 $165,000 ($69,947) ($46,952) ($23,958) 2,741 1,453 3,497 7,691
2007 $165,000 ($65,720) ($43,170) ($20,621) 1,997 856 2,682 5,535
2008 $165,000 ($53,698) ($32,414) ($11,130) 1,549 593 1,679 3,821
2009 $165,000 ($37,049) ($17,518) $2,014 1,591 448 1,623 2,039
2010 $165,000 ($22,529) ($4,526) $13,477 2,039 447 1,349 2,486
2011 $165,000 ($7,256) $9,139 $25,535 630 146 373 630
Total Under Water -> 29,509

Could Tallahassee Houses Be $2B Under Water?

To give you an idea of the magnitude of the amount of losses the banks might face, the total of the negative equity in the chart above equals $968,443,180. That is just short of 1 Billion Dollars in Tallahassee alone, and this only is looking at home purchases. It is very likely the number from refinancing could be even larger. Even after we factor the homes that have already been sold (estimated) out of the equation, and adding the homes that were refinanced during this same period of time, I would estimate that the potential for residential loan defaults in Tallahassee could reach $2 Billion!

Could The US Housing Market Be $1.6 Trillion Under Water?

Now here’s the scary part. The Tallahassee real estate market is usually a fair microcosm of the US Housing Market. If we un-scientifically apply our numbers above, combined with the fact that we are about .06% of the US housing market, then that we can deduce that the US housing market has the potential for $1.6 Trillion in negative home equity, and just from home purchases alone.

I know that this last step was a giant leap, but the methodology was fair for conversation. Do you think $1.6 Trillion in residential loan defaults over the next few years could cause a collapse of the US banking system? I would love to see an analysis (performed by smart people :) ) of the equity situation in the total US housing market. I suspect it would quiet all the people saying the recovery is well under way!

This information only serves as support for my constant reminders that the housing market has many more years to go before we will find balance. If you know you will be selling a home in the next few years, sell it now, sell it fast, and use a progressive internet home selling plan to get the top dollar from your home while you can. The earliest sellers will get the highest dollars.

Filed Under: Housing Market Conditions, Mortgage / Finance Tagged: , , ,

Condo Financing Available In Tallahassee

Posted on June 3, 2011 Written by Leave a Comment

Condo Financing TallahasseeOne of the major problems that is slowing buyer activity in the housing market has been the tightening of mortgage lending standards. For the past six months, there has been a great difficulty in finding a lender willing to do condo financing in Tallahassee, but finally there are signs that this is starting to change and a fix for the housing market might be underway..

Another mortgage lending problem is finding lenders willing to do loans with a combined loan to value (CLTV) of 100%. This means that the lender will allow secondary lending to account for the down-payment or equity portion of the purchase. The reason that this is so critical in today’s real estate market is that so many homeowners have little or no equity, so once they sell a home and want to purchase another, they often times have great credit and a great payment history, but no cash for the equity portion of the purchase.

By re-establishing the 100% CLTV loans that worked successfully for many years prior to the housing market boom, we will see an increase in the number of qualified buyers in the market. This has been sorely missed and could very well be a required piece of the cure to the current housing market woes.

Note: If you are thinking “this is what caused the housing market to crash in the first place …” No, 100% financing from a single lending source caused the majority of the housing problem. By sharing the risk, the primary mortgage lender has very limited exposure, meaning somebody else will have to bear the risk of default. Often times, this will be the home seller, not a bank.

How To Get Condo Financing In Tallahassee

If you want to take advantage of a great short sale condo in Tallahassee but do not have enough cash for purchase, I have some good news for you. Yesterday, Robert Barnette with Hancock Bank, briefed my CENTURY 21 office about a new loan program that their bank is offering. They can provide condo financing in Tallahassee, and their new loan programs allow for a CLTV of 100%, meaning buyers with very strong credit histories do not need cash to close on a new condo in Tallahassee.

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Filed Under: Housing Market Conditions, Mortgage / Finance Tagged: , , ,
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