This year is already shaping up to be the year of the boomerang buyer, or the repeat homebuyer.  As it is now seven years since the housing crash, there are many buyers who experienced a financial hardship in the recent past who are getting back into the market to purchase a home again in 2015.

There were several changes recently to the waiting periods when a buyer or homeowner can obtain a new mortgage and repurchase a home again after a foreclosure, short sale or bankruptcy.  Borrowers today essentially have three options when it comes to obtaining financing to purchase a home. In fact, more than 9 out of 10 mortgages are either funded by Fannie Mae/Freddie Mac, the FHA or VA. So, if you are looking to purchase and need financing, it is more than likely you will be using one of these three financing options and it is important to know the current waiting periods when you can repurchase after a hardship.

After Foreclosure:

• Conventional: Seven years. If you included the foreclosure in a bankruptcy, you can qualify after four years instead of seven years.
• FHA: Three years. FHA buyers can qualify again after just one year if they experienced an economic event.
• VA: Two years.

After Short Sale:

• Conventional: Four years.
• FHA: Three years. If the FHA buyer did not have any late payments before their short sale, they are allowed to automatically qualify again for FHA financing. There’s also a fantastic FHA program called the FHA Back to Work Program. If a buyer experienced an “economic event” whereby their household income fell by 20 percent or more for a period of at least six to 12 months, the agency has now reduced the waiting period to only one year.
• VA: Two years.

After Bankruptcy:

• Conventional: Chapter 7, four years; Chapter 13, two years.
• FHA: Chapter 7, one year; Chapter 13, one year.
• VA: Chapter 7, two years; Chapter 13, one year.

What if you don’t fit into these rules?

There are new mortgage options available for borrowers who do not fit these more traditional mortgage options above. Portfolio lenders are stepping in to provide mortgage options for buyers who cannot qualify for conventional, FHA and VA financing, and with terms much better than private financing.

There are lenders who will provide financing for buyers less than six months out of a foreclosure, short sale or bankruptcy. Of course, this does not come without a price. You need a larger down payment and rates will be higher than traditional loans.

Another part of the puzzle to helping you get in a position to repurchase again is ensuring you have also started to re-establish your credit since the financial hardship.

For example, even though the required timeline of say two or three years may have passed so you can qualify for conventional or FHA financing again, it is important you have also started to rebuild your credit and have the required credit scores to qualify again for financing. The FHA and VA only require a 580 credit score to repurchase again.

The first step is to get a copy of your credit report to verify if the financial hardship or discharge is reporting correctly and to also see what your scores are.

You can go to www.annualcreditreport.com to get a free copy of your credit report (consumers are allowed one free credit report per year).

Then the next step is to start rebuilding your credit scores.

Filed under: Blog, boomerrang homebuyer, Down Sizing, Exclusive Buyer Agent, First Time Homebuyers, Florida Real Estate, Home Buyer Advice, Home Buyers, Home Financing, Homebuyer Advice, House Closings, Mortgage Information, Real Estate, Relocation by Kim Bregman
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For most people, buying a home is the largest and most significant purchase they’ll ever make. Hiring a real estate attorney early in the process will protect you against the unexpected, and ensure a smooth and low-stress closing. Every state and sometimes regions within states have differing requirements. Some states leave that as an option open to the buyer and seller while others mandate it as a necessity. Your local real estate agent should be able to advise you what the protocol is in the area in which you are buying.

A real estate lawyer will protect your rights and interests in the transaction…unless you are using an Exclusive Buyer Agent; they are the only party truly “on your side”. Hiring a real estate attorney is a smart choice.  A real estate attorney takes over after the selling price contract terms have established and all parties have signed.  They will review the contract itself, negotiate repairs based on the home inspection report, and collaborate with the title company.

A real estate lawyer has the experience and training to handle the unique issues regarding real property, and the problems most people can’t anticipate. They see a lot of contracts and know the local customs, and can help cut through roadblocks. In most states a real estate agents cannot draft changes to the contract or give legal advice and very few transactions fit into a “boilerplate” contract. In addition, most Realtor form contracts are drafted to the benefit of the Seller; an attorney will add language to further protect a buyer’s interests.

Your lawyer will review the purchase agreement during the contract review period and will check the fine print of the Conditions, Covenants and Restrictions (CC&Rs) in common interest developments like condominiums, coops, country club communities, developments, and townhome projects.

Your attorney works with your mortgage loan officer, the other party’s attorney and agents to make sure that dates are set for attorney approval, home inspection, title search, mortgage commitment and other contingencies are reasonable and achievable.

Your attorney will also review important documents, including legal descriptions, mortgage loan documents, the property survey, and the title and title insurance policy, and deed.

The attorney will inspect important documents for common mistakes such as typos and misspelled names, including the legal description of the home.

The bill of sale may be another important part of the transaction that categorizes and inventories any personal property, such as appliances or furnishings, that are to be included as part of the deal.

They are also extremely helpful in negotiating for unpaid prorated expenses due to you from the seller, such as: property taxes, condominium assessments, and utilities

In most states, attorneys can change legal language in a purchase contract and void a purchase contract under state laws. You might need this in case an inspection comes back with serious red flags such as mold, plumbing, or foundation issues.

Your attorney attends the closing, to ensure the process moves along efficiently and effectively. In the case of problems/issues, the attorney will counsel and represent you.

Your attorney has no direct emotional involvement in the transaction, and no conflict of interest. You’ll appreciate a levelheaded counselor by your side if the situation becomes difficult.

You’ll receive something of great value: peace of mind!

Filed under: Blog, Exclusive Buyer Agent, First Time Homebuyers, Florida Real Estate, Home Buyer Advice, Home Buyers, Home Financing, Homebuyer Advice, House Closings, Real Estate, Real Estate Closings by Kim Bregman
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If you are in your 20s and 30s and have ever even considered buying a home, you are positioned to take advantage of record low interest rates. Even if you have just graduated with student loan debt, have not saved the traditional 20% down payment, and worry that there are no homes available to purchase for people in your situation, you may be wrong.

Today mortgage brokers, bankers and direct lenders are lending more than ever. Loan options such as those from the FHA (Federal Housing Authority) enable qualifying first-time buyers to purchase with as little as 5 percent down. If you are credit-worthy and responsible with money, you can take advantage of the record low interest rates and loan options that exist today.

Keep in mind that in some markets, renting is as expensive as buying. If you do your homework, you may understand that a home purchase is within your reach.

Seek help from a professional:

With today’s easy access to online listings, most people old and young believe you don’t need a real estate agent. People assume that the role of the agent, pre-Internet, was primarily providing access to the “keys.” In reality, agents have always played a much larger role, one that many people don’t realize until they’ve gone through a transaction.

Choosing the right real estate agent is one of many tips for first time homebuyers you can see in this comprehensive article. Take the time to make a list of questions and then interview at least 3 different real estate agents before you decide on which one you want to work with. In the end this is your money and you can spend it however you want. There is no reason to settle for less than the best, even if you are a first-time home buyer.

Agents know the market like no one else because they’ve been inside hundreds of homes, have relationships with many of the agents, and have done many deals. They know exactly what to do when a red flag arises. Additionally, the home purchase is both personal and emotional. Through the years, buyers have acknowledged how they have let their emotions get the best of them. An agent will look at the property and the numbers objectively and advise you accordingly.

Most buyers have limited experience and understanding the the buying process, when you are purchasing your first home you need to recognize your inexperience and get advice and knowledge from a variety of sources. An agent has potentially successfully closed hundreds of deal. There are few people that can advise you with such authority and knowledge. To get the kind of results you really want, you are going to need to hire a great Exclusive Buyers Agent. It is important to choose someone who has a strong grasp of the local neighborhood, school systems, and demographics in the area you are looking in. Exclusive Buyer Agents have a fiduciary responsibility to the homebuyer. They have years and sometimes decades of experience in this industry. This means they have a firm grasp on what to do and what not to do when it comes to buying a house. They will also know what options are the best fit for your situation and they will have a network they can tap to find you the home you need.

While you will have the final word, most of the information you get about the process will come from the Realtor. This is why it is so important to pick one you can trust. Informed homebuyers interview several different agents before they choose which will represent them. This only makes sense. The agent is working for you and should meet your criteria. Whichever way you go, make sure you ask tough questions to verify that this person can do what you need done. The most important question you MUST ask is what their AGENCY RELATIONSHIP is. If they list properties they are not Exclusive Buyer Agents and have an inherent conflict of interest when representing you as the buyer. Also ask, has he or she worked with other first-time buyers? Does the agent have several recent references that you can contact? To understand the advantages of exclusive buyer agency and to find an EBA in your area visit the National Association of Exclusive Buyer Agents at www.NAEBA.com

Consult Others:

Seek out family and friends that care about you for advice about buying a home. Whether these are your parents, grandparents, friends or even mentors you worked with in school or at the job, you can benefit from their experience. They may have already bought a home, or several, and they will have experience to draw on and advice on where they went wrong and what they did right. There is a steep learning curve to buying your first house; you will need all of the help you can get to get good results.

Anyone who has owned a home for an extended period of time can attest to some of the great tax perks. Whether it is deducting your mortgage interest, building equity with each mortgage payment, or not getting taxed on capital gains profit, owning a home almost always wins financially over renting.

Identify desirable locations and neighborhoods:

First time home buyers do not always have a strong grasp on just how much location and neighborhood affects property value but the ease in which you can sell your property years down the road when you are ready to do so. There are not many factors that can influence the value of a home more than the location. There is usually a reason why you can get a lot more home for your money than elsewhere. You need to understand the pros and cons of location including, but not limited to, schools, road noise, commute time to work, neighborhood desirability, crime rate and more.

Understand immediate and long-term costs:

When purchasing a homebuyers should have a strong grasp on all the costs that come with buying a home. There are many fees that can add up quickly from applying for a mortgage, getting mortgage insurance, home inspection costs, hiring an attorney for contract review, title insurance, and a myriad of other optional expenses. You should know each and every one of these costs and see if they apply to your home buying situation.

These are just some of the costs and fees before you actually take ownership of your property. There are also expenses associated with owning a home besides paying the mortgage. Many buyers do not budget properly all the long term expenditures they will be taking on and end up struggling for a while due to a lack of proper planning. Comparing homes and prices is what your EBA can assist with. The purchase price is just one of the expenses, how much deferred maintenance does the property exhibit, what are the ages of the appliances and roof and will they need to be replaced soon, how much redecorating is required to make the home yours. These are all cash expenditures that you will incur after closing. You should weigh these costs against paying more for a newer or more renovated property that you can finance with a mortgage.

Decide on what type of housing makes the most sense:

One of the decisions you will likely face as potential property owner is deciding between whether a condo, townhouse or a home is a better buying decision based on your current life circumstances and housing needs. Do you travel a lot and don’t have time for property maintenance? Do you have kids and pets that need a yard? Are you likely to want a garden? Are you interested in some perks like a pool or a gym you can’t quite afford on your own?

These are the types of questions you should be asking yourself when trying to decide if a home or condo makes more sense to purchase. This is something that should be given careful consideration.

Take your time:

Buying a home is not like buying a new smart phone, computer or flat-screen TV. It’s not only a lot more expensive, it’s much more personal and emotional and not something to take lightly.

Even though the flow of information is quick today with texting, email and the Internet, a home purchase takes lots and lots of time, research and due diligence. It should never be rushed, ever. The home purchase evolves over time. Don’t feel compelled to rush into it or leap to a decision on a home. Don’t feel pressured by a “hot” market or competitive bidders. Slowly learn the market, do your research online and look at different styles of homes and neighborhoods. Over time, you’ll get more comfortable with the market, and with luck, you’ll get pre-approved for a loan. You may make an offer or two or three or four before you find the best home at the best price. Let the process work itself out over time. You’ll avoid buyer’s remorse.

Don’t be overwhelmed by data:

When your parents bought a home, there was probably little to no data available to them. They worked with a real estate agent who showed them homes, but they didn’t have access to so much historic data or access to the technology and information we have today.

Even so, access to all this information isn’t always a positive or accurate. Statistical comparisons of sales do not take into consideration location, finishes in the home, size of lot, and upgrades. Your Realtor should do a comprehensive market analysis that does a true assessment of the prospective home’s market value. Sometimes, conflicting or less than comprehensive information can stall a buyer. If you have a down payment saved up, can afford the monthly payment and plan to commit to the home for at least 5-7 years, then go for it.

Chances are, if any of the above doesn’t add up, you may not quite ready to buy — which means you might be better off renting for the time being.

When you have never done something before it is easy to make both financial and emotional mistakes. Fall back on the guidance of others, especially your real estate agent if they have years of experience assisting homebuyers. It is timeless advice that will guide you through the home buying process without a hitch. Best of luck!

Filed under: Blog, Exclusive Buyer Agent, First Time Homebuyers, Home Buyer Advice, Home Buyers, Homebuyer Advice, Real Estate, Relocation by Kim Bregman
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Hurricane hazards come in many forms, including storm surge, high winds, tornadoes, and flooding.  History teaches that a lack of hurricane awareness and preparation are common threads among all major hurricane disasters.  by knowing your vulnerability and what actions you should take can reduce these effects.  I hope you find this information informative.  Please bookmark this BLOG for future reference.

Checklists:

• Hurricane Preparation Tips: https://www.rapb.com/docs/articles/06-28–2015-rslc-article—hurricane-preparation-tips.pdf?sfvrsn=2
• Palm Beach County Emergency Supply Kit Shopping List: http://www.pbcgov.com/dem/hurricane/pdf/hurricane_supply_checklist.pdf
• Red Cross Supply Checklist: http://www.redcross.org/prepare/location/home-family/get-kit
• Digital Engagement Toolkit: www.ready.gov/ready2015
• CDC Checklist: http://emergency.cdc.gov/disasters/hurricanes/supplies.asp

Additional Resources:
(Includes Before, During, and After a Hurricane)

Before:

Apps:

• PBC DART: https://itunes.apple.com/us/app/pbc-dart/id526473189?mt=8
• Redcross Emergency: http://www.redcross.org/mobile-apps/emergency-app

Business:

• Business Planning: http://www.ready.gov/planning
• Protecting Businesses: http://www.fema.gov/media-library/resources-documents/collections/357

Evacuations:

• Evacuation Plan: http://www.redcross.org/prepare/location/home-family/plan
• Evacuation and Shelters: http://www.floridadisaster.org/disability/section1_2.html
• Evacuating Safely: http://www.ready.gov/evacuating-yourself-and-your-family
• Evacuation Zone and Route maps: http://www.floridadisaster.org/publicmapping/

Finances:

• Financial Preparedness: https://www.disastersafety.org/blog/top-10-ways-protect-home-wallet-hurricane-season/

Flooding:

• Flood Insurance: https://www.floodsmart.gov/floodsmart/pages/flooding_flood_risks/what_causes_flooding.jsp
• Preparing for Floods: http://www.fema.gov/media-library/assets/documents/13261?id=3262
• https://www.floodsmart.gov/floodsmart/pages/preparation_recovery/before_a_flood.jsp

Food & Water:

• Water: http://www.ready.gov/water
• Food: http://www.ready.gov/food

Homes:

• Securing Your Home: http://www.floridadisaster.org/securehome.htm
• Federal Alliance for Safe Homes: www.flash.org

Pets:

• http://www.ready.gov/caring-animals
• http://www.disastersrus.org/MyDisasters/pets/DIST_DisasterPetBrochure.pdf
• Horses: http://www.disastersrus.org/MyDisasters/pets/DIST_DisasterHorseBrochure.pdf

Pre-Season:

• Debris Cleaning Tips Before Storm (Pages 1-2): http://www.swa.org/DocumentCenter/View/103

Tips & Information:

• PBC Hurricane Preparedness: http://www.pbcgov.com/dem/knowurzone/
• Tips and Info: http://www.ready.gov/hurricanes
• Tips for people with Disabilities: http://www.ready.gov/individuals-access-functional-needs
• General Information: http://www.nhc.noaa.gov/prepare/

Weather & Forecasts:

• 2015 Hurricane Forecast: http://www.weather.com/storms/hurricane/news/hurricane-season-forecast-atlantic-2015-noaa-weather-channel-csu
• Severe Weather info(Supply Checklist on page 13): http://www.floridadisaster.org/swaw/2015/documents/2015%20Guide.pdf
• Latest Watches and Warnings – National Hurricane Center: http://www.nhc.noaa.gov/
• Pre Hurricane Season: http://www.swa.org/153/Before-During-and-After-the-Storm

During:

Food and Water:

• Food and Water During Emergencies: http://www.fema.gov/pdf/library/f&web.pdf
• Keeping Food Safe: http://www.ready.gov/food

Tips & Info:

• Before, During, and After Advice: http://www.fema.gov/media-library-data/253331ac179d32652a4d0cbf7fb3e6eb/FEMA_FS_hurricanes_508_8-15-13.pdf

Utilities:

• Turning off Utilities: http://www.ready.gov/utility-shut-safety

After:

Assistance:

• Applying for Assistance: http://www.fema.gov/apply-assistance

Clean up:

• Where to take Debris: http://www.swa.org/DocumentCenter/View/1182
• Debris Cleaning Tips(Pgs 3- 12): http://www.swa.org/DocumentCenter/View/103

Homes:

• Search for Rental Houses: http://asd.fema.gov/inter/hportal/home.htm

Search & Rescue:

• Informing Family and Friends of Your Safety: https://safeandwell.communityos.org/cms/index.php

Filed under: Blog, Exclusive Buyer Agent, Florida Real Estate, Home Buyer Advice, Home Buyers, Home Maintenance, Homebuyer Advice, Real Estate by Kim Bregman
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For many a foreign national, the United States has always been a great place to invest in.

Buying Real Estate in the United States does not give foreign owners any rights or privileges regarding legal stay or status. If you’re interested in staying in the states longer than allowed by a standard visa, contact an immigration lawyer.

By determining the primary use for your property and how long you plan to own it, you’ll be able to provide information to your real estate agent that will help guide the search and sale.

How will you use the Property?

Before you start your property search, it’s important to think ahead to how you’ll use the home once the deal is done.

• Will this be a vacation home?
• A home to stay in while doing business in the United States?
• A home for your children while they attend college in the States?
• An investment?
• An eventual long-term residence?

The way U.S. real estate transactions are carried out may differ from your home country. Each State in the US has its own set of rules regarding the purchase of real estate, including the type of purchase contract used, the method of closing the sale and even the duties and titles of the individuals involved.

Several important U.S. real estate practices that are worth noting are:

• In the United States, real estate listing information is shared by agents using multiple listing services ( MLS) and consumers can access that same information using real estate sites such as com or Realtor.com. In many other parts of the world, real estate is a fragmented business and buyers have to go from agent to agent to find a property.
• In some countries, it is typical to pay a fee to the agents who are scouting properties on your behalf and showing you around. In the United States, the sales commission is paid by the seller who has a listing agreement with the Seller, so buyers don’t pay anything to have an agent work on their behalf if it is being advertised in the MLS system. It is always advisable for a buyer to work with an Exclusive Buyer Agent who will protect the buyer’s interest in the transaction. Make sure you ask any agent you contact what their “agency relationship” is to you. Each state has different forms of agency and many agents do not work for the benefit of the Buyer.
• In the United States, real estate agents need licenses to operate. The licensing laws of each state differ regarding how much education is required, the type and depth of licensing examinations, and whether continuing education courses are required once an agent becomes licensed. The licensing system was designed to ensure real estate agents are qualified to guide consumers through the maze of finding, evaluating and financing real estate.

Foreign buyers will also want to give consideration to issues such as currency exchange rates, international wire transfers, banking systems, multi-national taxation and accounting issues, and import/export restrictions regarding currency and household goods. It is recommended that you consult with an accountant and attorney before finalizing any transaction.

Foreign buyers are eligible to buy single-family homes, condominiums, duplexes, triplexes, quadru-plexes and townhomes. Housing cooperatives or co-ops often have rules prohibiting foreign ownership. That’s because co-ops generally require that a buyer’s source of income be from the United States and that most of the majority of the buyer’s assets be kept in the U.S.

Financing or Paying Cash?

Qualified foreign buyers with a 30 to 40 percent down payment can often obtain financing for their U.S. real estate purchases. MANY BANKS REQUIRE FOREIGN BUYERS to have a specific amount ($100,000 or more) on deposit with the bank while others set loan limits of $1 million to $2 million. You may also be required to present a minimum of three months of bank statements.

The U.S. home loan market offers an array of safe, affordable mortgages, including some that will allow Muslims to buy a home without violating Islamic laws against paying interest.

Before applying for a U.S. mortgage, you must first establish credit and earn a good credit score. You can start building your credit score by opening U.S. bank and credit card accounts. You’ll also want to be sure to report all income on your tax returns. Lenders use this income information to determine how much money they’re willing to loan you to buy a home.

While you don’t necessarily need to be a citizen or even have a green card to buy a home in the U.S., you will need an Individual Taxpayer Identification Number.

All cash purchases are permitted, but U.S. law mandates that cash transactions over $10,000 be reported to the federal government. The requirement for reporting involves everyone connected to the transaction (purchaser, real estate agents, attorneys and title companies). The government wants to know how you earned the money and that it was legally obtained. Cash buyers can potentially save money on mortgage application fees, loan origination fees, appraisals and title insurance.

Should I purchase U.S. property in my name?

Foreign investors can purchase property directly – in their own names – or through some sort of business entity, such as a domestic corporation, foreign corporation, limited partnership, joint venture, real estate investment trust or limited liability company.

How the property will be used should play into your decision. Additionally, the structure through which you purchase your property can have dramatic tax consequences. Your real estate attorney and accountant should be able to provide counsel concerning your options.

Do I have to travel to the U.S. for the closing?

While you may very well want to attend your real estate closing, it is not necessary. In the event that you cannot or choose not to attend your closing, you must execute a “Power of Attorney.” This is a written document authorizing another person to represent you and sign on your behalf.  Some lenders may require that you be present in the US to sign their loan documents.  This is something you should inquire about when selecting a lender if you do not plan on traveling for the closing.

How will a U.S. real estate purchase affect my taxes?

A foreign property owners’ tax liability in his home country will vary depending upon where the purchaser is from and whether that country has a tax treaty with the United States. Consult a tax attorney familiar with your home country’s treaty to get answers to tax-related questions.

The United States government requires that foreign nationals pay U.S. income taxes (state and federal) on any net income (rental revenues less expenses) received from rental property. If tax returns are not filed in a timely fashion, a tax of 30 percent of the gross rental income may be assessed. Even if you’re incurring losses in the early years of your investment and you don’t owe any taxes to the government, you still must file your tax returns in a timely manner or be subject to financial penalty.

What is FIRPTA?

FIRPTA refers to the Foreign Investment in Real Property Tax Act of 1980.  This ruling authorizes the United States to withhold income tax when property is sold, exchanged, gifted, transferred or liquidated by a foreigner. The Internal Revenue Service takes 15 percent of the proceeds and the state government will also take a percentage (if applicable). When a US tax return is submitted reporting the capital gains tax, if there is any refund due, that money will be refunded to the filer.

If the buyer of the home from the foreign national investor will reside in the home more than 50% of the time and the home sales price is under $300,000.00, the purchaser is not obligated to retain the 15% tax.

Filed under: 20 Blogs, Blog, Exclusive Buyer Agent, First Time Homebuyers, Florida Real Estate, Foreign Home Buyers, Foreign Nationals, Home Buyer Advice, Home Buyers, Home Financing, Homebuyer Advice, International Home Buyers, International investors, Real Estate, Real Estate Closings, Real Estate Investment, real estate news, Real estate trends, Relocation, Retirement, South Florida Real Estate, western north carolina real estate by Kim Bregman
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