Mar 30, 2010 | Buying Real Estate, News, Realtors, Selling Real Estate
Last night FEMA made Disaster Declarations for much of Mass, RI and NH (see counties affected below). Lenders are going to require the appraiser go back out and do a re-inspection prior to funding to show that the property is undamaged / unaffected by the disaster. Be prepared for the phone calls. Be prepared to let the appraiser in quickly. Be prepared for potential delays to your closings. Be aware that this is not just Prospect Mortgage, this is going to be the case with any lender.
Here are the counties:
Massachusetts:
Bristol, Essex, Middlesex, Norfolk, Plymouth, Suffolk, and Worcester Counties.
New Hampshire:
Grafton, Hillsborough, Merrimack, Rockingham, Strafford, and Sullivan Counties
Rhode Island:
Kent, Newport, Providence, and Washington Counties.
If you have questions please do not hesitate to call or email me.
David Bremer
Senior Loan Officer
978-302-0475 Direct
877-721-7051 Fax
david.bremer@prospectmtg.com
www.DavidProspect.com
Mar 26, 2010 | Buying Real Estate, Legislation, Realtors, Selling Real Estate
New lead paint regulations go into effect in Massachusetts on April 22, 2010. Although the new regulations do not immediately or directly impact Realtors® and real estate agents, contractors will now be required to be certified by the Environmental Protection Agency in order to perform even the simplest repairs or renovations to properties built before 1978.
According to the state Childhood Lead Poisoning Prevention Program as much as 30 percent of childhood lead poisoning cases in Massachusetts involve exposure to lead dust caused by renovation work. That is a serious figure considering the devastating, life long effects of lead poisoning. Homeowners who have work performed on their property by contractors, including painters, plumber, electricians and carpenters, must ensure that the contractor is “EPA Lead Safe Certified.”
The rule can be summarized in four parts:
- Training and Certification
Beginning in April 2010, firms working in pre-1978 homes will need to be certified. In addition to firm certification, an employee will also need to be a Certified Renovator. This employee is responsible for training other employees and overseeing work practices and cleaning. The training curriculum for certification, in development with the EPA, will be an eight-hour class with two hours of hands-on training. Both the firm and renovator certifications are valid for five years.
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- Work Practices
Once work starts on a pre-1978 renovation, the Certified Renovator has a number of responsibilities. Beginning with distributing EPA’s Renovate Right brochure to the homeowner and having them sign the pre-renovation form in the booklet. Before the work starts the Certified Renovator will post warning signs outside the work area and supervise setting up containment to prevent spreading dust.
The rule lists specific containment procedures for both interior and exterior projects. It forbids certain work practices including open flame or torch burning, use of a heat gun that exceeds 1100°F, and high-speed sanding and grinding unless the tool is equipped with a HEPA exhaust control. Once the work is completed, the regulation specifies cleaning and waste disposal procedures. Clean up procedures must be supervised by a Certified Renovator.
- Verification and Record Keeping
After clean up is complete the Certified Renovator must verify by matching a cleaning cloth with an EPA verification card. If the cloth appears dirtier or darker than the card, the cleaning must be repeated. A complete file of records on the project must be kept by the certified renovator for three years. These records include, but aren’t limited to verification of owner-occupant receipt of the Renovate Right pamphlet or attempt to inform, documentation of work practices, Certified Renovator certification, and proof of worker training.
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- Exemptions
- The home or child occupied facility was built after 1978.
- The repairs are minor, with interior work disturbing less than six sq. ft. or exteriors disturbing less than 20 sq. ft.
- The homeowner may also opt out by signing a waiver if there are no children under age six frequently visiting the property, no one in the home is pregnant, or the property is not a child-occupied facility.
- If the house or components test lead free by a Certified Risk Assessor, Lead Inspector, or Certified Renovator.
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In pending real estate transactions real estate professionals should be certain that homeowners are aware of the new regulations, particularly if a seller is doing renovations or repairs to the property in preparation for the sale. Without doubt there will be a new form or two to be executed at the time of listing and or at closing.
Buyers purchasing properties constructed prior to 1978 (and there mortgage lenders) will certainly be looking for representation from sellers that the property is in compliance with the new regulation. Expect to see new language included in purchase and sale agreements accordingly.
Of course the EPA has published a list of frequently asked questions about the RRP Rule:
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Dec 22, 2009 | Buying Real Estate, Realtors, Selling Real Estate
Home resales are expected to have risen to their highest level in nearly three years in November, as an extraordinary level of federal support has pulled the housing market back from the worst downturn since the Great Depression.
Economists project home sales rose 2.5 percent to a seasonally adjusted annual rate of 6.25 million, up from 6.1 million in October, according to Thomson Reuters. If accurate, it would be the third-straight increase and the best month for home sales since February 2007.
The National Association of Realtors’ report is scheduled for release at 10 a.m. EST Tuesday.
Nov 10, 2009 | Realtors, Selling Real Estate, Short Sales
I was asked recently what the practical alternatives to doing a real estate short sale were. Although evey individual situation is unique and some other alternative may be available here are some of the more common alternatives:
Loan modification – If you want to keep you home but cannot afford the current mortgage terms, you may be able get the lender to work with you to modify the loan terms. This is not an easy process either. You will need to provide much of the same financial information that you provide for a short sale. The lender must be convinced that the modification will be a long term benefit to them and an option that will also work for you. If the lender determines that modifying the loan will only postpone a short sale or foreclosure, they will not likely work with you.
Foreclosure – Foreclosure is the judicial process that the lender will pursue to take ownership of the property in order to sell to cover the amount due on the promissory note. A foreclosure will also dramatically effect your credit and your future ability to borrow, especial for the purchase of another home. If you do nothing about your current situation foreclosure is the inevitable conclusion. If the lender does foreclose and is able to sell the real estate for more than what you owed to them they are required to return the difference to you (after the payment of all of their costs and expenses).
Depending on the circumstances, you may be subject to pay tax on the amount of the deficiency between the foreclosure sale price and the amount owed on the note.
Deed in lieu of foreclosure – This is the process where you would deed all of your interest in the real estate to the lender. This process may also have financial ramifications, and you lose all legal interest in the property. However, this may be one of the simplest alternatives if the lender agrees to accept the deed. In any event be certain that you know all of the facts and how signing a deed in lieu of foreclosure could effect you.
Bankruptcy – This is often the last resort if you cannot sell the real estate and foreclosure is not an option for you. It is possible file bankruptcy and retain ownership of owning your home, but bankruptcy will severely damage your credit for at least seven years and you will not have control of your finances.
Get Professional Assistance –Even if you think a short sale is the right answer for you, and you think you can negotiate the terms and process on your own, consult with you professional advisers beforehand. Speak with a Certified Public Accountant, a REALTOR, a Real Estate Attorney and a Bankruptcy Attorney. Having the right advice can is key to a successful outcome.
Nov 9, 2009 | Buying Real Estate, Realtors, Selling Real Estate
The National Association of Realtors reported that its pending home sales index, a forward-looking indicator based on signed contracts, rose 6.1% to 110.1 in September, following a 6.4% increase in August. It was the eighth consecutive monthly increase and the highest reading since December 2006. Read more here.
Oct 28, 2009 | Buying Real Estate, Mortgage Lenders, Realtors, Selling Real Estate
I have been speaking recently with many of my real estate business partners about their valid frustration over the Home Valuation Code of Conduct (HVCC) and how it unnecessarily jeopardizes transactions for homeowners and potential buyers.
The Federal Law imposed to protect consumers, as many others like it, is quickly becoming more of a burden then a benefit for the very consumer it is designed to protect.
There is an effort in the industry to encourage lawmakers to reconsider the HVCC. You can learn ore about the effort here and sign a petition that will be presented to lawmakers.
For those who may not be familiar with the code The Home Valuation Code of Conduct stipulates how appraisers, loan officers, lenders and real estate agents can handle the real estate appraisals in part it states that:
- A loan officer can NOT order the appraisal, and can not be involved with the selection of the appraiser;
- The lender must order the appraisal and must order it through a third party vendor (appraisal management company) that cannot be influenced by the lender, loan officer, appraiser or any other party to the transaction.
- If a second appraisal is needed it must be obtained from a second, unrelated, appraisal company.
The mandate of the institution of a third part vendor has caused a pricing shift. The cost of appraisals has not yet increased dramatically which means there is less of a profit now to be shared between the third party vendor (appraisal management company) and the actual appraisal company. The result is that appraisers with little or no experience are being used to reduce cost to the appraisal companies. Appraiser work loads are being increased and appraisers are working in unfamiliar markets/geographic areas.
Read more about the Home Valuation Code of Conduct here.
Sign the petition here.
