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April 20th, 2018 11:54 AM

Foreclosure 101: What You Need to Know


Most people don’t know anything about the act of foreclosure, other than that it involves losing one’s home. However, foreclosure is a complex process, and isn’t inevitable even if you are struggling to pay your mortgage or are months behind on payments. Here’s a brief overview that covers what foreclosure is, how to avoid foreclosure, how to stop scammers, tips for purchasing a home after foreclosure, and how a real estate agent can help--


Foreclosure Defined


Foreclosure is the act of the bank or lender taking possession of a home when the party holding the mortgage fails to make payments. Foreclosure doesn’t happen immediately; the bank must first send a notice of default, which is issued after the fourth missed monthly payment.


How to Avoid Foreclosure


Foreclosure isn’t inevitable, even if you’re behind on payments. You should work with an experienced professional to explore your options, including:


?      Modifying or refinancing your loan;

?      Seeking assistance from state or federal programs if you are unemployed;

?      Considering filing for bankruptcy; and

?      Selling your home.


Foreclosure Scams and How to Spot Them


If you are at risk of foreclosure, be aware of foreclosure scams. In these schemes, scammers promise to save your home or lower your mortgage payments, but require a fee to do so. These scams can cost you thousands of dollars, and may not delay or prevent the foreclosure. If you have received a notice of default from your lender, watch out for the following, which may be signs of a scam:


?      Anyone promising to modify your loan, but asking for a fee;

?      Anyone contacting you claiming to be from the bank/lender, but asking for payments to be sent to a separate location/party;

?      “Money-back guarantee” claims;

?      Offers to buy your house for cash; and

?      Pressure to sign documents or papers you don’t understand and haven’t thoroughly read.


Can I Purchase a Home after a Foreclosure?


If your home was foreclosed on, you may be wondering whether or not purchasing again in the future is possible for you. Many people purchase a home after foreclosure, but must do the following first:


?     Save money - If you want to purchase after foreclosure, you will likely be required to put at least 10 percent down;


?     Rebuild credit - You will need to show a history of on-time payments and a low credit card balance in order to qualify for a loan after foreclosure; and


?     Wait - You will likely have to wait at least two years, and up to seven years, to qualify for a loan after foreclosure.


Reach Out to an Experienced Real Estate Agent to Learn More


To learn more about the foreclosure process and buying a home after foreclosure, contact an experienced Orlando real estate agent. A real estate professional can help you to find a home that’s within your budget, and answer any financing questions you have.


Posted by David W. Welch on April 20th, 2018 11:54 AMLeave a Comment

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April 16th, 2018 3:23 PM
#OrlandoRealEstate inventory continues to slowly decline, holding back stronger sales. Last month, the number of sales was only up about 1% compared to a year ago. The continued strong demand for homes in Orlando pushed the median price up to $230,000. That is up about 6% compared to last March. We are in the heat of the spring selling season, and homes are selling about as fast as they are coming on the market. Even with over 4,400 new listings last month, the total number of homes available for sale was up by just four properties to 7,710 over the prior month. Please take a look at this brief video from the Orlando Regional Realtor® Association with a breakdown of the market report for March 2018.

Posted in:Market Report and tagged: Orlando real estate
Posted by David W. Welch on April 16th, 2018 3:23 PMLeave a Comment

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March 21st, 2018 3:20 PM
I get emails and calls every week asking about 'rent to own' homes in Orlando. The first thing you need to know about lease purchases is that virtually nobody offers their home for sale under a lease purchase or rent to own. Out of more than 5,000 homes in Orange and Seminole Counties only 28 were offering to sell via lease purchase or lease option. There is a program though that is specifically designed to help people looking for a lease purchase alternative. Home Partners can turn many, if not most, of those 5,000 homes for sale into a lease purchase option.

To qualify, you must have a household income of at least $50,000 per year, and a minimum credit score of 575. You cannot have any recent evictions or be in bankruptcy, and they also do a criminal background check. If this sounds like it could work for you, find more details and even apply for the program right here

Check out my Facebook Live video below. #OrlandoRealEstate

Posted by David W. Welch on March 21st, 2018 3:20 PMLeave a Comment

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March 15th, 2018 11:17 AM
Sales were up only slightly, but the median sales price jumped another 10% compared with February 2017. The continual shrinking of the inventory of #OrlandoRealEstate for sale combined with strong demand is likely to keep pushing prices up. Now is the time to buy.

Posted in:Market Report and tagged: Orlando real estate
Posted by David W. Welch on March 15th, 2018 11:17 AMLeave a Comment

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February 15th, 2018 11:41 AM
#OrlandoRealEstate market report for January 2018. Sales are up only modestly on plummeting inventory, but prices are way up compared to a year ago. Now is a great time to sell.

Posted by David W. Welch on February 15th, 2018 11:41 AMLeave a Comment

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The selling season is upon us. Do you know what your home is worth? I'd be happy to provide you with a FREE customized report for your #OrlandoRealEstate. Just click below, and give me a little information about your property. I will prepare a comparative market analysis, and email the report to you.

Posted by David W. Welch on January 24th, 2018 4:52 PMLeave a Comment

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January 16th, 2018 1:15 PM
More of the same last month here in Orlando. Sales are up, but only slightly as low inventory is keeping us from have much greater sales growth in my opinion. The low inventory coupled with strong demand has pushed prices up double digits compared with December 2016. As long as our inventory remains so low, look for this trend to continue. We have a sever shortage of homes available for sale priced below $300,000. Take a look at this brief video with the market report for December 2017.

Posted by David W. Welch on January 16th, 2018 1:15 PMLeave a Comment

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December 15th, 2017 11:16 AM

Posted by David W. Welch on December 15th, 2017 11:16 AMLeave a Comment

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December 6th, 2017 11:15 AM


The Down Payment

The amount you have available for a down payment will affect what types of loans for which you can qualify. Down payments typically range from 3 to 20 percent of the purchase price for the property.

Tips for Accumulating a Down Payment

  • Save
    Look for ways to reduce your monthly expenditures to save toward a down-payment. You could enroll for an automatic savings plan at your bank to have a portion of your payroll automatically transferred into savings. Most people save a couple of years for their down payment.

  • Borrow the down payment from your retirement plan
    Check the provisions of your retirement plan. You can borrow funds from a 401(k) plan for a down payment or make a withdrawal from an Individual Retirement Account. Be sure you understand the tax consequences, repayment terms and/or possible early withdrawal penalties.

  • Move
    You may be able to save additional funds if you can move into less expensive housing.

  • Reduce other higher interest rate debt
    Paying off credit cards will initially reduce your savings, but the money you will save from higher interest rates will pay-off in the long run.

  • Make a deal with the seller
    In some circumstances, it is appropriate to ask the seller to carry a second-mortgage to cover your down payment. Typically, you will pay a slightly higher rate for this second mortgage.

  • Sell some investments

  • Get a second job and save your earnings

  • Skip a year's vacation

  • Gift from Family
    Parents and other family members are often anxious to help children buy their first home and may have the means to give you a gift of money for a portion or all of your down payment.

Alternative Sources

  • No-down and low-down Mortgages

    • FHA Loans
      The Federal Housing Authority (FHA), which is part of the U.S. Department of Housing and Urban Development (HUD), plays a significant role in helping low- to moderate-income families qualify for mortgages. FHA assists first-time buyers and others who would not qualify for a conventional loan, by providing mortgage insurance to private lenders. Interest rates for an FHA loan are usually the going market rate, while the down payment requirements for an FHA loan are lower than conventional loans. The required down payment can be as low as 3 percent and the closing costs can be included in the mortgage amount.

    • VA Loans
      VA Loans are guaranteed by the U.S. Department of Veterans Affairs. Service persons and veterans can qualify for a VA Loan, which usually offers a competitive fixed interest rate, no down payment and limited closing costs. While the VA does not issue the loans, it does issue a certificate of eligibility required to apply for a VA loan.

    • Piggy-back Loans
      A second mortgage that closes with the first. Often the first mortgage is for 80% of the purchase price and the "piggyback" is for 10%. The home buyer covers the remaining 10% with their down payment. (Some lenders will write a second mortgage of 15% or even 20% of the purchase price.)

    • "Carry Back" Mortgage
      In the case of the seller "carrying back a second mortgage", the seller loans you part of his or her equity. In this scenario, you would finance the majority of the loan with a traditional mortgage lender and finance the remaining amount with the seller. Typically you will pay a slightly higher interest rate on the loan financed by the seller.

  • Housing Finance Agencies
    These agencies offer special loan programs to low- and moderate-income buyers, buyers interested in rehabilitating a home in a targeted area, and other groups as defined by the agency. Working through a housing finance agency, you can receive a below market interest rate, down payment assistance and other incentives.

    • The primary mission of Housing Finance Agencies is to boost home ownership in targeted areas, among first-time buyers and those with little money for down payments. Most of these non-profit agencies were funded with state government seed money and now operate independently.

      Click here for a list of Housing Finance Agencies.

  • Documenting Your Down Payment

    Documenting that the down payment comes from your savings and that you will have savings and/or assets over and above the down payment gives the lender confidence in your strength as a borrower and your ability to repay the loan.

    Take extra care to document the sources for any monies to be used for the down payment or closing costs.

    Acceptable Down Payment & Closing Costs Sources

    • Cash in a bank account
    • Mutual funds / stocks / IRA / 401K
    • Proceeds from the sale of another property
    • Gift from an immediate relative

    Click here to learn more about verifying your down payment, closing costs, income and debt.

by David Welch
Orlando Real Estate


Posted by David W. Welch on December 6th, 2017 11:15 AMLeave a Comment

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November 15th, 2017 11:06 AM
Prices and Sales are both up from October 2016, but inventory continues to decline. Prices climbed 6% compared to a year ago, and the number of sales was up 7%. With out current absorption rate, we are running less than a 2.9 month supply of inventory. The number of homes available for sale is down 16% from a year ago. Check out this short video breakdown of the October real estate market results, courtesy of the Orlando Regional Realtor Association.

Orlando Real Estate

Posted in:Market Report and tagged: Orlando real estate
Posted by David W. Welch on November 15th, 2017 11:06 AMLeave a Comment

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