Archive for April, 2010

Utah Real Estate Market Data Report- April 27, 2010, by Inwest Title a Utah Title Company

Friday, April 30th, 2010

If you are interested in Utah’s market trends for interest rates, home pricing, monthly listings vs. sales, average home sale price per County, construction permit starts, and much more, then please download the  Inwest Title’s Market Data Report from our website. Our report is emailed to hundreds of Real Estate, Mortgage and Title Insurance professionals twice a month.

If you are interested in being added to the distribution list please send an email to Deborah Cope or contact any of our Marketing professionals in one of our 12 convenient statewide locations.

Monetary Incentives are available to Lenders and Homeowners for Short Sales or Deeds-in-Lieu of Foreclosure**, by Inwest Title a Utah Title Company

Friday, April 23rd, 2010

In the last few weeks the Home Affordable Foreclosure Alternatives (HAFA) Program has come into play.  This program will allow homeowners to avoid some of the negative impacts of a foreclosure by (1) providing financial incentives for both the Homeowner and Lender to participate, and (2) by requiring that both the first mortgage holder and all subordinate lien holders must fully release their liens and waive all future claims against the homeowner for any amounts still owed after the completion of the short sale or a deed-in-lieu of foreclosure.

To learn more about HAFA please watch this video produced by the US Treasury Department :

The financial incentives under HAFA are as follows:

  • Homeowner Relocation Assistance. Following the successful closing of a short sale or DIL, the homeowner who is selling their property will receive $3,000 to assist with relocation expenses.
    • Short sales – payment is received from the closing proceeds, and
    • Deed-in-Lieu of Foreclosure (DIL)-  payment is received at time of closing or a check must be mailed within five business days of the homeowner’s vacancy and delivery of keys to the Lender or its agent.
  • Lender Incentive. The Lender will be paid $1,500 to cover administrative and processing costs.
  • Reimbursement for Subordinate Lien Releases. A maximum of $2,000 will be paid for allowing a portion of the short-sale proceeds to be distributed to or paid to subordinate lien holders. (3 to 1 matching basis = $6,000.00 to be paid to subordinate lien holders = $2,000 reimbursement). The subordinate lien holders must agree to release their liens and waive all future claims against the borrower.


Key provisions of HAFA for real estate agents assisting in a short sale:

  • Pre-Approval. Lenders are also require to pre-approve short sale terms, when requested, prior to the home being listed.
    • The pre-approved terms are contained within a Short Sale Agreement (SSA) which are effective for 120 calendar days.  Lenders may extend the effective date by up to 12 months.
  • Fast Decisions. Once a Real Estate Agent submits a Request for Approval of Short Sale (RASS) the Lender must approval or deny it within 10 business days.
  • Mandatory Approvals. Approval must be granted if the net sale proceeds to the Lender are equal or exceed the preapproved minimum amount (as contained in the short sale approval).
  • No Commission Reductions. Lenders are prohibited from requiring, as a condition of approving the short sale, a reduction in the real estate commission agreed upon in the listing agreement.
  • Up to 6% Commission Allowed. Real estate commission is not to exceed 6% of the contract sales price.
  • Standardized Forms to Request a Short Sale. Special forms must be used for Homeowners that qualify under HAFA, however they are readily available for download here->  HAFA Homeowner Forms .


How do you know if a Homebuyer qualifies for HAFA?

  • Principal Residence.  The property is the homeowner’s principal residence.  If you the homebuyer no longer lives in the residence there are a few exceptions where you may still qualify.
  • Short Sale Loan Prior to 1/1/09.The mortgage loan is a first lien mortgage originated on or before January 1, 2009.
  • Mortgage Delinquency or Default. The mortgage is delinquent or default is reasonably foreseeable.
  • Loan Principal Balance Limit. The current unpaid principal balance is equal to or less than $729,750, higher amounts apply to multiple unit buildings.
  • Income vs. Debt. The homeowner’s total monthly mortgage payment exceeds 31 percent of the homeowner’s gross income.
  • Participating Lender. The program may not be required of every loan or by every lender so check with your lender to see if this program is available to you.

What is a Short Sale?
In a short sale, the servicer allows the borrower to list and sell the mortgaged property with the understanding that the net proceeds from the sale may be less than the total amount due on the mortgage. The short sale must be an arm’s length transaction with the net sale proceeds (after deductions for reasonable and customary selling costs) being applied to a discounted (“short”) mortgage payoff acceptable to the lender/servicer. When a lender/servicer accepts the short payoff they agree to release their trust deed from the property allowing the sale to the new buyer to be completed.  In some circumstances the lender/servicer may (1) forgive any deficiency owed by the seller, or (2) require all or a portion of the remaining loan funds they did not receive from the short sale to be repaid by the seller at a later date.  As a short sale can have significant legal and tax consequences you should consult with legal and tax professionals prior to engaging in this type of process.

What is a Deed-in-Lieu of Foreclosure?
In a deed-in-lieu of foreclosure (DIL), the borrower voluntarily transfers ownership of the mortgaged property to the servicer in full satisfaction of the total amount due on the first mortgage. The servicer’s willingness to approve and accept a DIL is contingent upon the borrower’s ability to provide marketable title, free and clear of mortgages, liens and encumbrances. Generally, servicers require the borrower to make a good faith effort to sell the property through a short sale before agreeing to accept the DIL. However, under circumstances acceptable to the investor, the servicer may accept a DIL without the borrower first attempting to sell the property. With either the HAFA short sale or DIL, the servicer may not require a cash contribution or promissory note from the borrower and must forfeit the ability to pursue a deficiency judgment against the borrower.

**The information compiled above is from and Supplemental Directive 09-09 Revised.  If you need additional details about HAFA we highly recommend you review these sources or call and speak with a counselor about this program at the Homeowner’s HOPE™ Hotline 1-888-995-HOPE (4673).

As HAFA has just been recently launched (and will run through December 31, 2012) check back as we will be blogging soon about the real world details of this program once we see it in action.

Time is Running Out on the First-time Homebuyer Tax Credit, Make Sure to Act by April 30, 2010!, by Inwest Title a Utah Title Company

Friday, April 16th, 2010

The current First-Time Homebuyer Tax Credit is quickly coming to an end.  If you qualify and want to receive a tax credit (of up to $8,000.00 for first time homebuyers and $6,500.00 for long time residents) on the purchase of a principal residence then you must enter into a written binding purchase contract by April 30, 2010 and close no later than June 30, 2010.  There are only a few weeks left to take advantage, so get busy shopping and find the home of your dreams.  Congress has not expressed any intention of extending this credit, so once this credit is gone it may never be back.

The great part about this credit is that if you purchase by the 2010 deadlines, then can receive the immediate benefit of the credit by claiming it on your 2009 tax returns without having to wait.  Below are a few key requirements in order to claim the credit, but we recommend you fully review the IRS requirements for this program and check with your tax professional to make sure you qualify.

Basic Requirements:

Who Qualifies?

  • First-Time Home Buyers (no home ownership in the 3 years prior to your new purchase).
  • Long time residents who have owned and used the same principal residence for 5 out of the last 8 years.
  • Members of the Armed Forces and some federal employees outside of the US may have an extra year to purchase a principal residence and claim the credit.  (Contract by April 30, 2011 with purchase completed by June 30, 2011).

Income Limits?

  • Yes.  The credit begins to be phased out if your modified adjusted gross income exceeds $125,000.00 for single taxpayers and $225,000.00 for joint taxpayers.

Purchase Price Limitation?

  • Yes.  Maximum purchase price of $800,000.00.

To review detailed requirements of the tax credit review the following helpful links on the Internal Revenue Service’s web site:


Utah Real Estate Market Data Report, by Inwest Title a Utah Title Company

Friday, April 9th, 2010

Just a reminder for those of you who haven’t seen Inwest Title’s Market Data Report, it is available for download from our website here.  The report is emailed to hundreds of Real Estate, Mortgage and Title Insurance professionals twice a month.  If you are interested in being added to the distribution list please contact one of our Marketing professionals today.  The report gives current Utah real estate information with regards to interest rates, home pricing, number of listings etc.