5/20/12 BP Newsletter: Pacing Your Investments, Increasing Profits, & Speeding Up New Deal Screenings
Hide thisCan I use the tax credit toward a down payment or other closing costs?
Monday, June 29
Yes. An announcement made May 29 allows the tax credit to be used toward purchase costs of a home, including down payment in some cases. This can be done one of two ways. First, buyers using an FHA-approved lender can sell their anticipated tax credit to the lender and use the proceeds to immediately apply the tax credit to any down payment above the minimum down payment of 3.5 percent required with FHA-insured mortgages. Second, buyers who receive financing through state housing finance agencies and certain non-profits will be able to use the tax credit for their down payments via a tax credit advance loan that does not result in any cash back to the buyer.
From ReatyTrac
Bank of America Revises Short Sale Policy
Friday, May 29
Bank of America, one of the country’s largest mortgage lenders, says it is loosening its policies on short sales in response to the U.S. Treasury Department’s announcement last week that it would increase incentives for lenders to work out short sale deals.The government’s plan is a boon to banks, says David Sunline, BofA’s real estate management executive, because it provides guidance when there are multiple liens, a potentially litigious issue for lenders.
In the past, the bank followed Fannie Mae’s policy of giving second lien holders about 10 percent of the second mortgage balance in a short sale. Now when it holds the second lien, BofA will accept 5 percent of the net proceeds of the short sale, Sunline says. When it is the first lien holder, it will offer 5 percent to the holder of the second lien.
Sunline says home owners considering short sales should contact the bank within five days of getting an offer on the home and expect its cooperation as long as the offer is within the range of other sales in the area and the borrower can demonstrate financial hardship.
Source: The New York Times, Bob Tedeschi (05/15/2009)
Fannie Mae Lifts 4 Property Rule
Thursday, February 12
Investors Can Now Finance Up to 10 Investment Properties Starting March 1, 2009! Lending giant Fannie Mae announced on Friday, February 6th 2009 they’re lifting the 4 property rule limit as of March 1, 2009. The Fannie Mae Policy Change will allow qualified investors to finance more than 4 properties. This is a huge policy change that will make a massive positive changes in the real estate market across the country. Under the previous guideline investors could only finance 4 properties, which meant a seasoned investor with 5 properties, great credit and documented income could not finance an investment property. Well today that has changed. Here are the requirements for investors under this new guideline: Although the LTV is only 70% this is still a huge stride in the right direction allowing investors to capitalize on this market.
Property-flipping rule suspended.The White House temporarily suspends a rule that imposes a 90-day waiting period before foreclosed homes can be sold to receive government loans.(this doesn’t really apply to my investors who are buying for cash-flow purposes, however, it does help those investors who are selling to homeowners.)
Ty Hollander
TYMO Properties
Real Estate Investor
Camano Island, Washington
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