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Scott Darling

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From the FHA: MIP Update

Monday, March 19, 2012
by Scott Darling

Most people, when told that both good and bad news awaits them, will opt to hear the bad tidings first.  Although they dread receiving unpleasant news, their hope is that the ensuing good news will erase, or at least soften, what they heard earlier.  In the assumption that owners of Chester County PA real estate share this approach, the FHA has recently announced bad news/good news regarding their mortgage interest premiums (MIP) and fees.

The Bad News:  As part of ongoing efforts to encourage the return of private capital in the residential mortgage market and strengthen the Federal Housing Administration’s (FHA) Mutual Mortgage Insurance Fund, a new premium structure for FHA-insured single family mortgage loans on Chester County PA real estate was announced. 

  • FHA will increase its annual mortgage insurance premium (MIP) by 0.10 percent for loans under $625,500 and by 0.35 percent for loans above that amount. 
  • Upfront premiums (UFMIP) will also increase by 0.75 percent. This change is effective for case numbers assigned on or after April 1, 2012.  
  • FHA is also exercising its statutory authority to add an additional 0.25 percent to mortgages exceeding $625,500.  This change is effective for case numbers assigned on or after June 1, 2012.

FHA estimates that the increase to the upfront premium will cost new borrowers an average of approximately $5 more per month.  These marginal increases are affordable for nearly all homebuyers who would qualify for a new mortgage loan.  Borrowers already in an FHA-insured mortgage, Home Equity Conversion Mortgage (HECM), and special loan programs outlined in FHA’s forthcoming Mortgagee Letter will not be impacted by the new pricing changes.

So, if you are FHA qualified and have been sitting on the fence, NOW is the time to become a Chester County PA real estate owner while you can save money!

The Good News:  In a bid to make its Streamline Refinance Program more affordable to U.S. homeowners the FHA has introduced a new concept in mortgage insurance premiums. Going forward, the amounts the owner of Chester County PA real estate will pay for FHA mortgage insurance will depend on the age of existing FHA mortgage.  The longer you've had your mortgage, the less you're going to pay for MIP.  Certainly a reason to smile for many people!

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Tax Benefits Of Homeownership

Monday, March 19, 2012
by Scott Darling

tax benefits

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Tax Relief For Distressed Home Owners

Tuesday, February 21, 2012
by Scott Darling

In December of 2007, Congress signed into law the Mortgage Debt Relief Act to aid distressed homeowners.  Under regular circumstances, when a lender chooses to forgive all or part of a borrower’s debt, that amount is considered income and the borrower is liable to be taxed on it.  However, this law offers relief to the owner of Chester County PA real estate in that debts discharged through calendar year 2012 are not taxable.  Limited to primary residences only, the amount of forgiven mortgage debt allowed to be excluded from income tax is $2 million per year.  Debts reduced through mortgage restructuring as well as mortgage debts forgiven in connection with foreclosure qualify for this relief.

On the fence about selling your underwater Chester County PA real estate as a short sale?  Consider this: if your home isn’t sold before January 1, 2013, and you owe $50,000 more than its market value, you could realistically end up paying more than $12,000 in taxes in 2013 if you’re in the 25% tax bracket! Once you decide on going the short sale or foreclosure route—and remember, short sales often take a long time to sell--the first thing you need to do is to request that your lender officially and in writing  waive any deficiency connected with your Chester County PA real estate.  If this waiver is not granted, the lender has 20 years to obtain repayment from you via collection agencies, garnishments, and/or liens.

Because of the impending deadline and the length of time required for short sales and foreclosures, many real estate and financial gurus stress the importance of acting now to set wheels in motions.  They urge distressed owners of Chester County PA real estate to realize that there is no tax exclusion allowed on pending closings/foreclosures.  Only transactions completed by December 31, 2012, are eligible for income tax relief—and there are no indications that the current deadline will be extended!

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Home Affordable Modification Program Update For Chester County PA Homeowners

Tuesday, January 17, 2012
by Scott Darling

When the Obama administration announced the Home Affordable Modification Program (HAMP) in 2009, officials estimated 3 to 4 million borrowers would seek relief from their mortgages through the program during the worst recession and housing market collapse in decades.  More than two years later, however, those projections have proven to be optimistic, to say the least.  Mired in extensive paperwork, lost documentation, costly time delays, and extreme frustration on the part of the Chester County PA home owners attempting to participate, the program has been examined, monitored, revised over and over to make the process a smoother and more successful one.  A daunting task, however; the most recent report by the Office of the Special Inspector General for the Troubled Asset Relief Program SIGTARP) devoted over 15 pages to a description of procedures, requirement, and changes involved with the program!

Originally designed to help financially struggling owners of Chester County PA homes avoid foreclosure by modifying their loans to a level that is both affordable and sustainable, HAMP’s success is uncertain—or at least arguable.  Critics charge that only 700,000 owners have actually benefitted from the program and claim that while the Treasury initially committed $75 billion of Troubled Asset Relief Program funds to the HAMP initiative, it now appears it will spend only $4 billion on HAMP incentives.

The members of the Congressional Oversight Panel even stated that government’s loan modification program was “ineffective,” and they claimed that the Treasury’s reluctance to address flaws of the program has had “real consequences.”  Their report also states that the Treasury has failed to hold loan servicers accountable when they have repeatedly lost borrower paperwork or refused to perform loan modifications. And TARP has stated “The program has been beset by problems from the outset and, despite frequent retooling, continues to fall dramatically short of any meaningful standard of success."

There are, of course, success stories, and supporters point out that the 700,000 approved loan modifications mean that many fewer foreclosures.  They urge financially-strapped home owners to fully investigate the program, get help to complete the sometimes grueling process, and use websites specifically designed for the potential applicant.  They also maintain that eligible homeowners entering HAMP have a high likelihood of earning a permanent modification and realizing long-term success. The rate of modifications moving from trial to permanent is up to 74 percent, and the average time to convert from a trial to permanent modification is down to 3.5 months.

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Homeownership Still The Goal

Tuesday, January 17, 2012
by Scott Darling

homeownership

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Leaving Your Chester County PA Home For The Holidays?

Monday, December 19, 2011
by Scott Darling

Here are some sensible travel tips for you…

While many people choose to stay in—or close to—their Chester County PA home during this busy season, a large number of folks travel via plane, train, or car to celebrate with family and friends.  To maximize holiday travel happiness and minimize coal-in-the-stocking disappointment, follow these basic but helpful tips compiled by ASTA (American Society of Travel Agents) as they reveal secrets that will help you and your family arrive at Grandma's house full of holiday cheer.

Before leaving:

  • Packing light saves time and energy when it comes to filling the trunk with fragile bags packed with gifts or racing to fill the last empty space in the overhead bin.

  • Be sure to secure your Chester County PA home. Lock all doors and windows, and don't forget to set the alarm.
    Also, give your home that lived-in look to repel potential burglars by having a friend collect your mail, setting lights on timers, and omitting details of your trip on the answering machine.

Air travel:

  • If possible, have a friend drive you to the airport, or take a shuttle or public transportation.
  • Take the worry of getting to the airport completely out of the equation by staying at an airport hotel the night before an early flight.
  • As flights are sometimes overbooked during the holidays, it's critical to check in early. Domestic travelers should arrive at the airport at least two hours prior to departure, while international travelers should arrive at least three hours in advance.
  • Remember that delays can occur. Bring water and snacks, an inflatable pillow, a good book, your favorite CDs, MP3 player, and a deck of cards to help pass the idle time.

Car travel:

  • Before you leave your Chester County PA home, have a qualified mechanic check all the car's vitals: brakes, battery, fluid levels, tire pressure, light bulbs and any parts that need regular maintenance.
  • Bring emergency equipment, such as a first-aid kit, flashlight, blankets, drinking water and snacks, along with flares and jumper cables.
  • Don't leave valuables in your car. Pack all items, especially brightly wrapped packages, in the trunk. If you’re afraid of squashed bows, wait until you arrive to wrap the gifts.
  • If you're travelling with children, get everyone involved by singing or reminiscing about favorite past holidays. The ride will be over before you know it, and you may actually look forward to the drive back home.

Whatever your mode of travel, make sure you take along a large supply of holiday cheer!

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Free Apps To Save Money This Holiday Season

Monday, December 19, 2011
by Scott Darling

november

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Adding Value To Your Chester County PA Real Estate

Wednesday, November 16, 2011
by Scott Darling

If you are one of the millions of Americans whose home has lost value in recent years, despair not.  Whether you’re trying to spiff up your Chester County PA real estate for resale, to raise its appraisal, or just to keep current with updating and maintaining what you currently have, there are many relatively easy and budget-worthy steps you can take.   Some of these minor projects designed to increase value are quick fixes while others may require a weekend’s worth of work, but all will certainly revive the look of your property.

Exterior improvements:

  • Keep shrubs and trees neatly pruned.  Plant new trees for energy savings and aesthetic value.
  • Add low-voltage lighting for pathways
  • Pay attention to the front door of your Chester County PA real estate.  Does it need new weather stripping?  A fresh coat of paint? Updated (or at least polished) hardware—knockers, knobs, hinges, and light fixtures?
  • Spend $10 to test your lawn for needed nutrients.
  • Attend to the garage door.  Use a mixture of one part bleach to three parts water and a soft-bristled brush to give it a thorough cleaning.  Still dirty or stained?  Rent a power washer for about $60.
  • Check for faded or peeling paint.  Sand and apply a fresh coat.

Interior improvements:

  • If you can’t replace the water heater in your Chester County PA real estate with a tankless model, wrap the one you have in fireproof insulation.
  • Install modern light switches and outlets throughout your home.  Add dimmer switches.
  • Insulate windows.  (Easy-to-follow instructions.)
  • In bathrooms replace dated towel racks, light fixtures, sinks, toilet seats, and hardware.  Purchase a low flow toilet.  Re-grout where needed.  Display matching towels.  If the floor is in poor shape, consider putting easy-to-install vinyl tiles right over the old one.
  • Add crown moldings, wood trim, and/or cornices to give room a look of quality.
  • Update your kitchen inexpensively by replacing fixtures, faucets, and hardware.  Consider pendant lighting.  Refinish cabinets rather than replacing them.
  • Clean and organize all closets. 
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How To Pay Off Your Mortgage Faster

Wednesday, November 16, 2011
by Scott Darling

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Tips to Improve Your Score

Tuesday, October 18, 2011
by Scott Darling

Your credit score is a number that helps lenders predict how likely you are to make your payments on time. This score affects your ability to obtain credit and helps determine what you pay for credit cards, auto loans, and mortgages on Chester County PA homes. Even your insurance rate is related to your score. The higher your score, often referred to as a FICO score, the more apt you are to be approved for and pay a lower interest rate on new loans. Scores ranging from 650 and below are considered bad and indicate to the lender that you are a very high risk. Chances are you will be unable to secure a loan, or if you are, it will be at a much higher interest rate and/or require a cosigner.

What If there Are Errors

What to do if you have a low score and do not qualify for a mortgage on a Chester County PA home? Your first action should be to check your credit report for errors. If you find erroneous information, you need to act immediately by contacting both the credit bureau (the three major ones are Equifax, Experian, and Transunion) and the organization that provided that information.

  • The credit bureau/agency: Send a certified, return receipt requested letter to the bureau pointing out each inaccuracy and enclose copies of documents which support your claim as well as the report itself (with the misinformation highlighted). Factually explain why you dispute each item and request a deletion or correction for each one.
  • The creditor or information provider: Send the same type of letter and enclose the same documents. Request that the provider notify you of action taken (generally within 90 days) so that you can verify the amended information.

If there are no errors on your report, then you should take immediate steps to improve your credit. Ways to do this include the following:

  • Stop using your credit cards. Do not continue to accumulate debt.
  • Get current on delinquent accounts. Since payment history makes up 35% of your score, this action will have a great impact on your score.
  • Keep accounts with balances open, but don’t apply for more credit.
  • Call your creditors. Explain your financial situation and ask about possible hardship programs which will temporarily reduce your monthly payments.
  • Begin paying off your existing debts, even if you have to sell some belongings to do so. Come up with a get-out-of-debt plan and stick to it.
  • Get professional help. There are resources available to help you reestablish a good credit rating. Contact the National Foundation for Credit Counseling for assistance.
  • Be patient. Realize that improving your credit score takes time and that there is no quick-fix --and keep in mind your goal of owning a Chester County PA home.
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Displaying blog entries 471-480 of 530

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