How To Own A Home Again After Foreclosure

  1. It is never easy to get another mortgage after a foreclosure. Be patient, given time, proper discipline, and willingness, you can own a home again. Follow this guide to purchase a home again:
    1. Don’t jump on jobs after foreclosure, stick with just one
    If your job is not stable maybe this is the reason you lost your home in the first place. The first step to own a home again is find a stable job and hold on to that. Lenders require stable employment before giving you another loan after a foreclosure. Make it work.
    2. Rebuild yourself after foreclosure
    Create a safety net. Consider having three to six months of living expenses in a liquid account. Truth is, after a foreclosure, six is a minimum to show stability and that you’re able to pay your bills and mortgage. This could also prove that you can sustain yourself for an extended period if you lose your job.
    3. Build a better credit score after foreclosure
    Again, this is not easy. The timeframe itself could consume you. After foreclosure, your credit score dropped approximately by 150 points. Raise it back up with perseverance.
    Pay bills on time and keep your credit card balances below maximum levels. Details on the foreclosure will stay on your credit report for seven years, but if you prove your money management skills have matured, it will become less of a red mark as years go by.
    4. Decrease your waiting time for a mortgage after foreclosure
    Usually, you have to wait seven years after a foreclosure before you can apply for a loan again.
    However, you might wait only three years if you can show extenuating circumstances for your foreclosure, which are defined as “events that are beyond the borrower’s control that result in a sudden, significant, and prolonged reduction in income or a catastrophic increase in financial obligations.” These include:
    Losing a job
    Getting divorced
    Having unexpected medical expenses
    Another alternative if waiting isn’t your thing is obtaining a seller financing, essentially bypassing the traditional mortgage. If both parties are amenable, you can enter into a lease with an option to buy, or take a mortgage directly from the seller. You’ll most likely have to prove a source of funds, but if you’ve turned around your financial situation quickly after your foreclosure, it’s worth a shot to deal directly with the seller.
  2. Keep in mind that sellers may be motivated to agree to this if they need to sell and the potential buyers they’ve met with can’t obtain a conventional mortgage—perhaps because they’ve been through foreclosures, too.
    5. Be honest about your foreclosure
    When getting a new mortgage, don’t lie about your foreclosure. On the contrary, be proactive and reveal the steps you’ve taken to remedy the problems that led to your foreclosure.

If you stay disciplined and positive, the American dream—obtaining a mortgage and owning a home of your own—can, indeed, be yours again. Even after foreclosure.

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The 3 Reasons Your Home Will Not Sell – Real Estate

3 Reasons Why Your Home Won’t Sell –  In the real estate world we call a property that does not sell within the contracted listing term an Expired Listing.  For the home owner who has been trying to sell a home this can be a frustrating thing.  These home owners, however, are not alone.  The average real estate agent unfortunately sells only between 60% – 70% of his/her listing inventory.  This means that during a balanced market up to 40% of listing contracts expire before the home sells.  The Seller of an Expired Listing is then forced to make two decisions: to re-list and try again; or to stay at the property for an indefinite period of time and to re-list with another agent or to attempt to sell on their own, as a FSBO (For Sale By Owner).
Here is a countdown of the top 3 reasons why a property will not sell during it’s listing contract term:
 3.  Condition:  The condition of the property can either be a huge deterrent or an appealing factor in a buyer’s decision to bring an offer.  Has the home been updated in the last 5 to 10 years or is it sporting shag carpet from the 70’s?  The Retro look is making a comeback but most buyers are not all that down with purchasing a home with counter-tops and cabinets that show 40 years of wear-and-tear.  In general, if you keep the home updated with current trends, not only will it sell faster but it will sell for more money than a home that has not been updated.  Selling a home that is dated for the most possible money is not impossible however… in order to do this, you have to be “on-point” with the next 2 reasons.

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2.  Marketing:  How is your listing being marketed?  Most agents will put your home on the local MLS System and rely on their broker’s marketing systems to do the rest.  Unfortunately, most brokers follow a standard IDX (Internet Data Exchange) marketing campaign that merely shares the listing with all the other local brokers in an attempt to promote more exposure.  The problem with this is that we currently live in the Information Age where trends in mobile apps, social networking sites and social media sites change faster than you can say Twitterpated!  If you are looking for the best chance to sell your home in this fast-paced internet age, you will have to focus on the software and applications that give your property the ultimate market exposure.
And now for the #1 reason why most homes do not sell during the first listing contract term…

  1.  Price:  In a tight race with Marketing, Pricing ends up being the #1 reason homes do not sell during the first listing contract.  There are many reasons for this.  If the home is priced accurately according to the neighborhood but it doesn’t line up with the Condition of the property in relation to comparable homes then is it essentially overpriced.  If the market is heading in a downward direction and the property is priced well today, it will not be priced well in as little as 2-4 weeks.  If the home is priced right but the Marketing does not line up, then the home actually becomes overpriced considering the lack of marketing…  In short, these 3 factors work together to either create success or to create another expired listing.  If you would like to ensure your real estate sale goes smoothly, the best thing you can do is to take these three factors in to account and either find an agent who knows his/her stuff or make sure you have the time to do it on your own.

To find out more about real estate in Louisville and the surrounding areas, click here.

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Interview Questions For Your Lender – Real Estate

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A good mortgage planner is more in the advice business than the lowest price business.  With tightening guidelines, often the question first is, “Will the loan be approved?”  But moreover, the borrowers’ concerns need to involve some of the answers to some of these non-price questions:

1. What type of lender should I use?
There are three basic types of lenders.  Mortgage BROKERS promote a broad product menu, competitive pricing, and entrepreneurial approach; however, BROKERS cannot lock, commit, or approve your loan because they are not actual lenders.  Banks and Credit Unions rely on financial strength, direct lending capabilities, and stability; however, they have limited product menus and often a “cover my butt” mentality.  Mortgage BANKERS blend the best of both: direct lending ability, financial strength and stability, wide product offerings, competitive pricing and the entrepreneurial spirit.

2. What loan products should I be considering?
Make sure your lender has multiple types of products (Conventional, FHA, VA, State Mortgage Agency Products, etc.).  While most people today do choose a 30 year fixed, it is not always the wisest choice.  Borrowers need to consider how long they will be staying in the home and any changes in their income during that time period before just accepting the same loan as everyone else.  Additionally, with many properties in need of some renovations or repairs, you need to explore the discussed in one of my earlier articles.

3. Should I lock or float my interest rate?
Most mortgage planners are trained to dodge this question.  I believe you should be hiring an expert who should have an informed opinion about the direction of rates….in the short term and the long term.  Weighing numerous factors ranging from your projected closing date to upcoming economic reports, a good mortgage planner can counsel a client into saving money.  While no one can predict with absolute certainty, you need to reach a comfort level that the lender you choose has the best information and your best interest at heart.

4. What are mortgage rates based on?
There is only one correct answer.  It is the pricing of Mortgage Backed Securities. If you get the wrong answer on this basic question, what else don’t they know?

5. What is the next important economic release that can impact rates?
How will a Jobs Report, a Fed Board Meeting or Inflation Number affect your home loan?  Your mortgage planner should know, explain it to you, and keep you informed.

6. How can I improve my chances of getting approved and at the lowest possible cost?
Sometimes even minor improvements in a credit score, the amount of your down payment, or how you position your assets can make a big difference.  During your counseling sessions, your mortgage planner should be advising you on how the “little things can make a big difference.”

Good advice, whether it’s from your doctor, lawyer, real estate agent or lender, can be invaluable.  Finding a lender who is an expert….who has your goals in mind…and who offers creative solutions is one of the most important factors in a successful real estate transaction.

To find out more about real estate in Louisville and the surrounding areas, click here.

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