Renting and Tenant Rights

What Happens to Your Home Equity Line of Credit When You Default?

Default equals. A home equity line of credit is just a line of credit secured by a lien on your home. Essentially, a home equity line of credit is exactly like a second home loan. Default under the home equity line of credit enables the creditor to foreclose and sell your home.

Lien

When you apply for and get a house equity line of credit, the lender will require you to sign a mortgage or trust deed, both of which are legal documents that give the creditor a lien on your home. The lien is your lender’s remedy if you default in your repayment on the line of credit. The creditor exercises which remedy by carrying out foreclosure after you default.

Notice

The very first thing happens when you default on your house equity line of credit is the lender will send you a Notice of Default and Election to Sell. This Notice of Default is an official letter which initiates the foreclosure procedure. The Notice of Default points out that you’ve breached your repayment obligation and the creditor intends to sell your house in foreclosure.

Acceleration

The Notice of Default also accelerates the home equity line of credit, which basically means that the creditor is now demanding payment in full online of credit. Rather than paying the line of credit off over time, after acceleration you must pay back the full amount of the outstanding balance on the line of credit immediately in order to prevent foreclosure.

Foreclosure Sale

Three to six months, depending on state law, after sending the Notice of Default, the creditor then has the right to send a note of a foreclosure deal. The foreclosure sale is a public auction where a third party, called a trustee, sells your home to the highest bidder and then uses the money earned to pay off the home equity line of credit. Any sales proceeds that are excess will be reimbursed to you.

Eviction

After the foreclosure sale, you no longer have a right to occupy your house. If you try and stay in the house, either the creditor or the new owner who purchased the house at the foreclosure sale may file an eviction suit and have the sheriff eliminate you from the house. Eviction means the sheriff forcibly removes you and your possessions from your house.

Caution

Default on a house equity line of credit is every bit as significant as according to a primary home loan. You stand to eliminate the very house that secures the line of credit. It should go without saying, then, that default should never be an option.

See related

Eclectic Homes

How Quickly Can I Get a Mortgage?

Many things can impact the length of time it takes to receive a mortgagefrom how active the lender is when you apply to the requirements of laws and regulations. When planning to acquire a new mortgage, it’s crucial to consider the time of your program and the period of the procedure so as to correctly anticipate how quickly the money will be disbursed.

Waiting Periods

Regulation Z, or the Truth in Savings Act, was amended in 2009 to add mandatory waiting periods such as mortgages. Banks may not close a home loan in fewer than seven days from the time that you are given the disclosures which accompany your program. This compulsory waiting period is to allow you time to fully examine and understand the terms of the loan prior to documents are signed. The need may only be waived if you have a bona fide crisis which can be recorded. As a result of this regulation, it’s usually not possible to get a mortgage faster.

Underwriting Times

Varies by establishment and by the general level of activity on the marketplace. It can extend the time it takes to assess yours, if a lender or mortgage company is experiencing a high volume of applications. It can take anywhere from a few days to a couple weeks for your document to be reviewed depending on these variables. To expedite this procedure, react quickly to any requests for verification or information, such as home assessments or tax returns.

Rate Lock Period

1 method of evaluating whether a lender will have the ability to provide you a mortgage quickly is to look at the duration of the rate lock it’s using. If you lock in your mortgage rate, the lender tells you how long that rate will be legitimate. There is A standard rate lock period usually approximately 30 days. If your loan agent promotes a longer lock period, it could be because the opportunity may be more than 30 days at that establishment.

Rescission

Regulation Z also requires a rescission period for loans Along with needing a waiting period following program. If you are refinancing your current mortgage or taking equity out of your home, the bank must wait three business days after you register documents so as to disburse the funds from your loan. After your loan closes to reconsider and terminate the bargain if you want, rescission is designed to give you time, but this time does delay the availability of cash.

Factors

Whether it takes a month or longer or 10 business days to receive a mortgage, it’s necessary to investigate and fully understand the loan prior to signing. Carefully review all of disclosures given to you, and think about using the waiting intervals to shop different banks and mortgage companies to make certain you are receiving the best rate and closing costs available. Discuss the situation with your loan agent to ascertain whether you could be eligible for a waiver of the timing conditions if you are experiencing a true crisis, such as foreclosure.

See related

Renting and Tenant Rights

Can Bankruptcy Prevent Foreclosure?

Foreclosure allows a mortgage business to seize property when the borrower discontinues his monthly payments. The rationale behind the lack of payments differs depending upon the homeowner, but frequently a change in financial situation is to blame. In cases like these, some people file for bankruptcy to stop foreclosure from occurring.

Truth

Bankruptcy prevents foreclosure through an automatic stay. Santa Clara University Law defines the automatic stay as an injunction preventing any creditor from taking legal actions against a person who has declared himself bankrupt. His mortgage company may not initiate or proceed with foreclosure. Debtors receive protection through the automatic stay regardless of whether their personal bankruptcy case is a Chapter 7 or Chapter 13.

Types

According to the Federal Trade Commission, Chapter 13 bankruptcy allows debtors to repay outstanding debts rather than lose property as a consequence of their previous inability to make payments. Chapter 7 bankruptcy, however, requires the bankruptcy trustee to sell off any non-exempt assets the debtor owns–including her property. Thus, if the individual’s home does not fall under the exemptions allowed by her state or the national government, she could lose her home to the bankruptcy court rather than her mortgage lender.

Characteristics

A debtor who can afford to cover his mortgage payments after the bankruptcy court releases other outstanding debts might have the option to”reaffirm” their own mortgages. This prevents foreclosure from the mortgage business whilst at the same time preventing the bankruptcy trustee from seizing and selling the property. Reaffirmation is readily available for debtors in Chapter 7 bankruptcy who would otherwise lose their homes provided they have sufficient monthly income to cover their house payments and the mortgage lender agrees to the reaffirmation.

Factors

In a typical bankruptcy case, irrespective of chapter, the automatic stay remains in place until the insolvency verification, which takes approximately 60 days. The U.S. Bankruptcy Code, but contains provisions which shorten the distance of the automatic stay if the debtor filed prior bankruptcies which were disregarded over the previous 12 months. If somebody registered one previous bankruptcy which was dismissed by the court, then the automatic stay just remains in effect for 30 days. If he registered two preceding bankruptcies within the past calendar year, the court won’t grant him an automatic stay.

Caution

Although filing for bankruptcy can provide debtors with an effective approach to reduce foreclosure from occurring, mortgage lenders may request the court to lift the automatic stay when preventing foreclosure hurts the lender’s financial interests. If, by way of example, the debtor’s income won’t allow him to make mortgage payments after his bankruptcy discharge, the court may raise the stay and permit the lender to waive (See References 1).

See related

Eclectic Homes

Federal Help With Home Mortgage

In response to the collapse of the mortgage industry and their home markets, the federal government established programs to help struggling homeowners remain in their houses. The government purchased Fannie Mae and Freddie Mac, the two biggest government-sponsored mortgage investors to create mortgage refinance and modification programs designed to help homeowners make their mortgage payments. The US Department of Housing and Urban Development, HUD required their approved housing counseling services to provide counseling to homeowners facing foreclosure.

Counseling

Housing counselors are located throughout the country. These counselling services specialize in helping home buyers and homeowners with the mortgage process. These firms are all nonprofit businesses, and a few receive grants from HUD or other government agencies. These firms also specialize in foreclosure prevention. If you’re falling behind in your mortgage or anxiety you may, contact HUD toll free at 800-569-4287 to locate a counselor in your area.

Refinancing

1 issue is declining home values. Some homeowners discover they have a mortgage with a balance that exceeds the home’s value. Freddie Mac and fannie Mae have established special loan programs for homeowners who have a loan owned by one of these agencies. Contact your servicer, the company you make your payment to, and ask if company owns your loan and if you are eligible for any special refinance programs for this.

Temporary Modification

Servicers are invited to provide payment reductions or eliminations if they will assist a family make it through a temporary issue. Usually the servicer expands the loan duration by the amount of suspended payments. Once the homeowner makes it through the issue, the payments restart as scheduled without any negative marks on the credit report.

Permanent Modification

Servicers may permanently change the loan. The modification is on loan amount the interest rate or both. The modification will ensure the new loan repayment does not exceed 31 percent of the borrower’s gross monthly income. Borrowers must provide evidence of their income to the service ; typically this includes providing taxation returns and paystubs, W-2s. Conclusion of a trial period is required prior to the loan modification is made irreversible. If the borrower accomplishes any of their trial period payments, the modification is canceled by the servicer.

Foreclosure Alternatives

Occasionally giving up the home is the only alternative. Rather than waiting to be foreclosed upon, creditors may attempt to sell the home. Even if the debtors owe more than the home is worth, lenders are letting them sell the home as a short sale (if the home is sold for less than what is owed). Borrowers may also give back the home. This is until it is fully foreclosed upon when the home is turned over by a debtor. Fannie Mae and Freddie Mac have rental back programs that allow the homeowners to rent the home after they’ve given up the home. This permits them time to find another place to call home.

See related

Budgeting Your Project

What's Required to Sell Your House?

Selling your home without the support of a realtor can be an overwhelming task if you don’t know the process. However, if you get used to the steps involved and commit to the process, you need to be able to manage selling your home. Make sure you are prepared to take on the responsibility of promoting your home. Many tools such as books, legal forms and for sale by owner (FSBO) websites are available to assist you with successfully promoting your home. Remember that you have the choice to employ a real estate agent if the process becomes too overpowering.

Preparing Your Home

Before placing your home on the market, prepare it for sale. Complete any necessary repairs so that your home is in the very best condition and makes the best impression. In addition, do routine maintenance on things around your home like cleaning the gutters, altering blown-out lighting bulbs and removing weeds from the lawn. Complete any home improvement projects like painting or replacing outdated fixtures until you put your home on the market. Finally, remove all clutter and excessive furniture from you home, therefore it appears open and spacious.

Marketing Your Home

Marketing your home is important so as to get it sold. You may register for FSBO websites that allow you to record your property for sale. The majority of these websites charge a fee for your listing. List your property for sale in local papers, and place a For Sale sign in your lawn. Create fliers with full-color photos of your home and appropriate contact information and make them available for potential buyers.

Necessary Paperwork

Selling your property involves several varieties of paperwork. You require legal forms like a disclosure form and a sales contract, in addition to copies of documents like your survey as well as the deed to your property. Since having the appropriate paperwork is paramount to getting a valid and legal sale, you may need to employ a real estate lawyer to guide you through. The expense of hiring of attorney may well be worth it to protect against any legal issues that can happen with your sales trade.

Benefits

The biggest advantage of selling your home is saving money. Since you’re not having a realtor, you won’t have to pay a commission, that is a proportion of their sales price. Commissions on typical run about 6 percent of their purchase price, so on a $100,000 sale, you would pay $6,000 in commissions prices. That’s a large amount of money. Other benefits include the fact that you have more control over who sees your home, and you’re always home for all showings. Finally, you control all of the negotiations and all facets of the trade, so your needs and wants are put at the forefront.

Disadvantages

Selling your home is a big responsibility, and there are several disadvantages. You are accountable for all of the financial and legal aspects to the trade. You’ve got to be diligent about verifying that all of the paperwork is in order, so the sale doesn’t fall through and is lawful and binding. In addition, you have to create your own possible buyers using various advertising avenues. You are also responsible for all of your marketing costs, that can be quite pricey. Furthermore, selling your home is a time-consuming process. You’ve got to be available to show your home, hold open houses and respond to questions concerning your property. As a result, you have to give up much of your free time to handle this process.

See related

Eclectic Homes

Process for Buying Foreclosure Property

Buying a foreclosure might seem to enter the actual estate game. In down markets, foreclosures seem especially attractive as the real estate market becomes plagued by defaulted properties, some of which could be in great locations and in good shape. Nonetheless, the procedure for buying a foreclosure can easily become a nightmare when buyers overlook certain liabilities and dangers associated with defaulted properties, which makes otherwise would have been a wise investment into a money pit.

Preapproval Letter

Before buying any property, buyers must get a preapproval letter from a creditor by submitting documentation demonstrating proof of earnings, job history and financial status. A preapproval letter acts as a valuable negotiation instrument since it quantifies a loan amount that the purchaser qualifies for according to his current financial status. However, note that a letter is nonbinding to the lending company. It’s also subject to an appraisal, is time sensitive, and the loan amount and terms can change in accordance with your own credit and fiscal status.

Budget Accordingly

Foreclosures can come to market value but demand a lot of work. When some properties can be found in great neighborhoods, most foreclosures are typically sold in poor state. In addition to renovation expenses, the new homeowner might also be required to pay off any existing tax exemptions or unpaid interest, and might have to deal with evicting existing tenants. Sometimes, the potential buyer might know this information beforehand and perhaps even prevent the process altogether. Otherwise, potential buyers of foreclosed properties ought to consider these extra expenses when preparing their budget.

Find Foreclosures and Get the Owner

There are several approaches to find foreclosures. Get in touch with a real estate agent, a lender, a government agency such as HUD or Fannie Mae, or sift through local papers, online listings or by calling the county clerk’s office. According to MSN, the preferred method for inexperienced buyers would be to contact the lender directly for a listing of bank-owned properties. Bank-owned properties are those that were returned to the creditor after an unsuccessful auction sale. Once a bank owns a property, they’ll pay off any existing tax exemptions or unpaid debts and supply title insurance. You will also have the ability to inspect the property before buying it and take advantage of the bank’s seller-incentives such as favorable mortgage terms, lower down payments and no closing costs. With an auction home, you’ll be buying the property blind. That is, you won’t have the chance to inspect the house or determine whether there are any existing obligations to be paid off. Furthermore, you’ll have to cover the property up front in cash or using a cashier’s check.

Research

Foreclosed properties are offered in”as-is” state and are generally in disarray. Hire a contractor and inspector that will help you decide your renovation expenses. Additionally, you ought to do a name search to determine if there are any liens on the property, which may drive up the cost. Liens are any unpaid debts, taxes or contractor bills (mechanics’ liens) that will remain intact until the cash is paid. Normally, bank-owned properties should have a clear name, but you should still make sure this is actually the case lest you’re in charge of paying off some extra preexisting debts.

Financing

At a foreclosure auction house, you purchase property by paying money up front. Otherwise, you can take out a fresh loan or determine whether the property’s existing mortgage is assumable. With a loan assumption, the purchaser takes title to the property and takes over the existing mortgage without needing to get new funding. The assumed mortgage will have exactly the same terms, payments and because of amount because it was first originated to the original owner. Thus, a loan assumption may offer the benefit of having a lower interest than current market prices. Potential customers may also negotiate with the lender to remove the prior borrower from further obligations, thus putting the entire debt burden on the mortgage purchaser.

Make an Offer

At an auction, you just bid on the house and pay cash up front. Otherwise, you can either enlist the aid of a real estate agent to draft an offer letter or do it yourself. Research exactly what similar properties in the region are selling for to determine a fair market value and add up any existing liens found in a title search. The offer price is usually between the market value and all existing debts plus repair expenses.

See related

Budgeting Your Project

Things You Need to Know About Selling Timeshares

Selling timeshares isn’t as simple as selling a property the traditional manner. When you sell a house, buyers are clear about what they are paying for–entire ownership of a property. Purchasing timeshares involves different degrees of ownership, from fractional ownership to the right to use a property for a week a year. The unfamiliar terms and conditions of timeshares can make selling timeshares confusing. Learn how timeshares work and what determines their price before you begin selling.

Week Amount

A timeshare property can be divided to 52 timeshares: 1 for every week of the year. Not all weeks are worth the same. The value of a timeshare will fluctuate based on how much need there is for this week. Which months are more popular depends on the location of their property. Timeshares nearby ski resorts, for example, have their high season during winter months, while Caribbean retreats are popular in spring and summer.

Resales

If you’re hoping to resell your timeshares, hope to market below your purchase price. According to Stroman Realty, an online timeshare broker, the average price of a timeshare resale is between 25 percent and 50 percent below the developer’s pricing. The Federal Trade Commission is not as optimistic. One FTC report says “(timeshares) resales are hard if not impossible because there’s no secondary market and timeshares seldom appreciate in value.”

Location

Not all timeshares are made equal. Consider the location of a timeshare when deciding its selling price. Popular places like Hawaii or Florida come at an excellent price. The view, building quality and conveniences of a property are all important, but place trumps all.

Deeds

Timeshares come in two chief flavors: deeded and non-deeded. Deeded timeshares supply the purchaser with a genuine ownership interest in your property. Non-deeded timeshares supply just the right to use the property during a particular period for a certain variety of years.

See related

Budgeting Your Project

Can You Have Two FHA Loans at the Same Time?

Mortgages have been intended to fund loans for houses. Since you are able to reside in just one primary home at a time, the FHA usually limits you to a FHA loan at a time, even though there are exceptions. FHA-insured mortgages might not be used to obtain investment properties.

Function

The FHA mortgage insurance program is designed to help people buy homes with little down payment and much more relaxed underwriting rules, together with the general goal of promoting home ownership, not investment. FHA loans are for an owner-occupied, principal home. To prevent the use of FHA loans to fund investment property, someone may get two FHA loans only in some specific conditions.

Size

A growing household is just one acceptable reason to acquire a second FHA loan. In the event the homeowner’s family grows so much that his existing home becomes too small, the homeowner might be allowed to buy a new residence backed by the FHA and keep the first house as a rental property. The homeowner must have the ability to demonstrate the FHA that the household size has increased and the present house is no longer adequate.

Relocation

Another exception to the only FHA mortgage rule comes into play in the event the homeowner goes to a new area not within commuting distance of the present house. An house can be bought by the individual in the new place and keep her present home. And the homeowner may relocate for reasons other than in an employer-forced move, as stated by the FHA handbook.

Co-Borrower

You can remain a co-borrower in an FHA loan and obtain another FHA mortgage. The FHA recognizes two kinds of co-borrowers. One is someone who divorces and stays a co-borrower despite moving from the house. The co-borrower may have the ability to acquire an FHA mortgage for a new home. The other type of co-borrower is someone who assisted a relative to get an FHA-insured mortgage. The first FHA loan is on the primary home of the household member and the individual who helped may find a second FHA mortgage for her own residence.

Considerations

The FHA puts a few limitations on obtaining a second FHA mortgage. For the borrower who would like to use the option to upgrade to a bigger house, the first home must have a loan-to-value of 75 percent or even less. The borrower will need to acquire an appraisal and pay the mortgage down to meet with the 75 percent limitation when the loan to value is significantly greater. To qualify for your next FHA loan, the debtor might need to have a signed lease agreement on the first residence and show cash reserves to cover the payment for 6 to 12 months on the mortgage when he loses the tenant.

See related

Budgeting Your Project

How to Have an FHA Loan With Bad Credit

Even though FHA loans are usually the go-to merchandise for borrowers who can’t qualify for a traditional mortgage due to less than perfect credit, they’re not a sure bet. The market for home loans and other kinds of credit altered after the financial crisis that began in 2007 took down a lot of the American home industry. Obtaining credit is rougher, as of 2010. Lenders view low FICO credit scores, which indicate a greater risk of default, together with great scrutiny.

Save additional money. Borrowers with little up-front money tend to be attracted to FHA-insured mortgage loans because of their reduced down paymentas little as 3.5 percent. In accordance with HUD, however, at July 2010 you need a FICO score of at least 580 to be eligible for 3.5 percent . Borrowers with a credit score under 580 should possess at least a 10 percent down payment. A score below 580, notes the My Fico site, suggests a better than 50 percent likelihood that you will default on a home mortgage or other credit responsibility.

Evaluate your FICO credit score into the average score on recent FHA approvals. HUD data shows that the average FICO score for single-family-home FHA loans has been 698 in June 2010. This is up from 693 in June 2009. Since this is an average, borrowers with lower scores failed to be eligible; however, your approval prospects obviously reduce as your score drops.

Get ready conquer and to explain blemishes in your credit history. Even though HUD urges FHA lenders to assess a borrower’s overall credit performance instead of isolated missteps, the section requires”compensating factors” from potential homeowners with low credit scores or higher debt loads relative to their incomes. These points, based on HUD’s”Mortgage Credit Analysis for Mortgage Insurance on One- to Four-Unit Mortgage Loans” document, comprise timely home payments equal or greater to your projected monthly payment for 12 to 24 months prior to your application, a sizable down payment, substantial savings,”a conservative attitude toward the usage of credit” and the potential for an increase in future income, due to education or job training.

Consider a co-signer. FHA loans make it possible for co-signers, provided that the person meets HUD qualifiers. For instance, generally, co-signers can’t have a”financial interest in the transaction,” notes HUD. Co-signers must also keep their main residence in the USA.

See related

Eclectic Homes

Guest Groups: Letter Writing in Modern Style

Sitting down to write a new letter is one of my favorite things to do. At the end of the practice, I have had the opportunity to spend a quiet moment by myself, and now I have all the joy of knowing that I have created something unexpected for somebody else. Here is a group of accessories for developing a letter-writing nook for whenever the mood strikes. — Erin out of Reading My Tea Leaves

Hello Tenfold

Hey! Note Card, Single – $4

Not all events call for a long letter. Sometimes a sweet note is going to do. I adore these cards out of Hello Tenfold.

Schoolhouse Electric

Princeton Adjustable Desk Lamp – $229

Letter writing is frequently simpler with only a little bit of focused light. I enjoy this lamp because of its simple layout and traditional form.

Kaufmann Mercantile

Leather Pen Case – $104

If I need to take my letter writing on the move, a simple leather pouch for pencils and pens is always what I’m after.

Etsy

Oslo Writing Desk by Studio Moe – $875

This writing desk made from sustainably harvested ash would be perfect for a place where space is limited. I love the clean lines and mild end.

Etsy

Modern Desk Organizer by The Design Pallet – $45

I like to get all my writing implements . This hardy organizer created from reclaimed lumber would do just the trick.

Old Faithful Shop

Carrière Lavender Candle – $51.99

Even though a candle is not a necessary part of letter writing, a sweet scent and a hot glow always help me along. These soy candles out of Carrière Frères Industrie are incredible.

Barneys New York

Arte & Cuoio Leather Desk Blotter

It’s an old-fashioned type of matter, but the sensation of hand writing a letter on a leather desk blotter can not be beat.

Brook Farm General Store

Straw Wastepaper Basket – $59

Not every epistle will come out perfectly the first time. I would use this basket as a spot to store lost drafts on their way to the recycle bin.

Father Rabbit

Wood Memo Clipboard

I sometimes like to write letters in areas other than my desk. Whether I’m curled up on the couch or sitting on a park bench, having a simple wooden clipboard makes it a far more enjoyable experience.

Mjölk

The Spanish Chair – CAD 3,950

This leather chair has armrests so broad I can envision crafting a letter using one of these as a writing surface.

SIMPLESONG Design

XO + Hello Wax Seals – $16

I love wax seals, but I make a mess whilst using them. These seals are self adhesive — easy peasy.

Hickoree’s Hard Goods

Tombow Pencils – $19

I love the smell of freshly sharpened pencils, and I especially love that they let me erase any pesky spelling mistakes!

Etsy

Personalized Letterpress Stationery Boxed Set by Honizukle Press – $30

I think I would be compelled to write more letters if I had my own letterpress stationery at the ready. I love the white on white of this collection.

Etsy

Par Avion Rubber Stamp by Hunter’s Hideaway – $18.95

While I compose letters to individuals abroad, I like to add just a little reminder to the postal company to speed up things.

Schoolhouse Electric

Standard Steel & Oak Dining and Office Chair – $325

For minutes when I actually must focus, sitting upright at a desk helps me concentrate. This simple chair would be the perfect place to perch.

Etsy

Bear Personalized Letterpress Stationery for Kids by In Haus Press – $125

This stationery might be created for kids, but I would quite enjoy a personalized set for myself.

Etsy

Postcup by Bailey Doesn’t Bark – $52

I enjoy a fantastic ritual, and sitting down to compose a letter with a cup of tea by my side is just one of my favorites. This Postcup seems like just the thing to accompany a letter author.

FilzFelt

Circle Trivet – $10

While I usually opt for tiny versions of things, this oversized coaster is fantastic for a large cup of tea.

Kaufmann Mercantile

Caran D’Ache Ecridor Fountain Pen – $245

If I’m going to tackle a brand new letter, I want to do it in style. No pharmacy ballpoints for me just a fountain pen will do.

Etsy

Ceramic Cup by Fashioned From $25

I like the form of this catchall. It would be perfect for erasers, clips and even a roll of postage stamps.

Next: A Love Letter to Writing Desks

See related