Paula Henry

This is the top of the main-content

Is Hope for Homeowners a Plan for You?

October 27th, 2008 categories: Indianapolis Real Estate News, Indy Foreclosures, Real Estate Financing

The Hope for Homeowners (H4H) plan went into effect on October 1st. While, I do believe it is a benefit for some, I don’t think it will help or benefit as many as it should. Many of the homeowners I speak to have to weigh the financial impact of their decision to try and stay in their home. Some can not be helped by this plan.

Let’s look at the details.

To qualify:

  • The home must be your primary residence 
  • You can not have ownership in any other residenial property.
  • Your current mortgage was originated before January 1,2008
  • You must have made at least six payments
  • Your lender must agree to accept 90% of the current market value

The costs:

  • 3% upfront mortgage insurance premium
  • Closing costs for the new loan
  • Your equity, in the form of equity share
  • You can not refinance for five years

If your home is worth $200,000 and the current lender writes off the loan to $180,000, you will have a new FHA loan for $180,000, but FHA owns your equity. Depending on when you sell your home, the equity you receive will be 50% or less.

Sell the first year, you receive none of the equity.

  • Year two, you receive 20%
  • Year three, you receive 30%
  • Year four, your receive 40%
  • Year five and beyond, you receive 50%

This is a great deal for those who owe more than the $200,000 the home currently appraises for, especialy if they have the money for the upfront fees and plan on staying in their home.

My first thought is the plan may be too taxing for many banks, depending on the amount of the original loan versus the current appraised value. If the amount of the original loan for the same $200,000 home is $220,000, the bank will automatically write off $40,000. In Indianapolis, where we did not have huge price increases, this may be a viable option for some homeowners who are facing foreclosure.

See the full guidelines here. 

Tags: ,

Authored by Paula | Discussion: No Comments »

Real BailOut from the Banks

October 27th, 2008 categories: Indianapolis Real Estate News, Indy Foreclosures

The recent bailout of wall street and banks has many trying to figure out exactly what it means for homeowners who may be facing foreclosure. While I don’t know the specifics about what the bailout means for individual homeowners, there are a few banks who have published their plans for assisting homeowners who are behind in their mortgage payments.

In the Indianapolis area, there have been 387 bank owned homes listed on our local listing service since October 1st. That’s a lot of families displaced due to foreclosure. My frst bit of advice for homeowners who are behind is to keep in touch with their lender.

Now, there are a couple of lenders who are reaching out to homeowners with programs designed to keep them in their homes.

The now defunct, IndyMac, has their program in place and Bank of America, who now owns Countrywide, has announced their plan for homeowners, which will begin in December.

The Hope for Homeowners program also went into effect on October 1st. It remains to be seen whether other banks will follow the steps of IndyMac and BofA or participate in the Hope for Homeowners plan. 

If you’re an Indianapolis homeowner who is facing foreclosure, please contact your bank first. There are some, who due to job loss, illness or other life changing circumstances who will not be able to take advantage of these bank programs. It is still best to contact the bank or mortgage company and see what your options are.

Tags: ,

Authored by Paula | Discussion: No Comments »

Indianapolis Real Estate Report - September 2008

October 12th, 2008 categories: Indianapolis Real Estate, Indianapolis Real Estate News, Indy Market Trends

Township

Active

Pending

Sold

Absoprtion Rate

Wayne

1077

219

127

8.4 months 

Pike

825

138

85

9.7 months

Washington

1335

165

135

9.8 months

Lawrence

1157

204

140

8.26 months 

Warren

1098

204

123

8.26 months

Franklin

561

86

74

7.5 months

Perry

707

117

109

6.4 months

Decatur

277

55

44

6.3 months

Beech Grove

99

16

15

6.6 months

Speedway

52

5

5

10.4 months

Center NE

1164

130

75

15.5 months

Center NW

213

13

10

21.3 months

Center SE

524

92

37

14.1 months

Center SW

49

14

1

49 moths

There are currently 9138 homes available in Marion County in Indianapolis. The graph breaks down the homes available by Township. There were 980 homes sold which gives us a 10.7 month supply of homes. Of course, this does not apply to all areas or price ranges.

For instance in Center Township NE, there are 374 homes available under $50,000, while the highest priced home comes in at a cool 2 million for a luxury downtown condo at 333 Massachusetts Ave. Since many of the downtown condos have been on the market for awhile and take much longer to sell, the average sales price, days on market and absorpton rate are truly subject to neighborhood and price range.

Check Market Snapshot to find what homes in your neighborhood are selling for.

MLS Market Snapshot

Click here for a neighborhood community report. 

Tags: ,

Authored by Paula | Discussion: No Comments »

What Caused the Housing Crisis?

October 3rd, 2008 categories: Indianapolis Real Estate News, Indy Foreclosures, Real Estate Financing

Warning - this post is political in nature!

Not being one to publish political views on my blog, I have been debating for over a week about whether to post this video here. Ultimately - I decided the general public should see the video and make their own conclusions.

Even as a REALTOR, I wonder, how did the climate of the real estate market change so dramatically in such a short period of time. I believe this video answers the question best. The simple answer is, supply and demand. When the supply of “easy” loans were made available, the demand for such loans increased. As more people qualified, homes were quickly purchased, decreasing the supply of inventory, which increased the demand. Everyone seemed to jump on the bandwagon and money was easy to get.

Although Indianapolis did not have the same appreciation as many of the hotspots around the country, we are, nevertheless, experiencing the effects of the changes. We have our share of foreclosures and short sales, just not on a grandiose scale as some areas. We have other issues here such as property taxes, which have affected homeowners. Still, the supply of easy money was the beginning………along with the belief that real estate values would not go down.

Watch the video for the informational value, not the political opinion.

http://www.dailymotion.com/videox6wxmr

Authored by Paula | Discussion: 1 Comment »

Please Don’t Put Your Home on the Market!

September 21st, 2008 categories: Indianapolis Real Estate News, Indy Home Sellers

Put it ‘in” the Market

Really, I mean that! Probably not the way you think I do, though! See, there’s a huge difference between putting your home on the market and placing it “in” the market.

I’ve written before, not too long ago, actually, about pricing your Indianapolis home to sell. I honestly admit I do allow my clients to test the market “for a time”, especially if there are not enough comparable sales in their neighborhood or if they have an outstanding or unique home. I also let them know we must be ready to adjust the price based on activty, feedback and lack of offers. It rarely earns me bonus points, but I prefer honesty above all else and have walked away from listings I knew I had no chance of selling when the homeowner is stuck on their price.

A Current Example

So, why do I write this again? I have to tell this story; it is exactly the type of homeseller who needs to take their home off the market.

This particular seller is wasting their time and their agents time! It is a home I was personally interested in buying. I made an appointment, but was turned down because it was an inconvenient time. Hmmm……in this market, if you can possibly accomodate a buyer, you really should.

At the time, the home had been on the market for almost one year and they were on their second agent. So let’s look at the history:

Agent #1 had the home listed at $###,###. for 4 months. The information provided was accurate. The pictures used to market the home were just okay. The agent didn’t use a wide angle camera, which failed to capture the true beauty of the home.

Agent #2 did a fabulous job capturing the beauty of this home with professional photography which made you want to make an appointment to see the home. It made me want to go see it! It was originally priced at $###,### with agent #2 and reduced by $15,000 over the next six months it was listed. $15,000 represented less than 4% of the original listing price.

And…………………………..it expired last week without selling.

This week it came back on the market, listed with another agent, who is only marketing with 6 outside pictures, nothing impressive and here’s the big difference – they raised the price $10,000 more than the price it was originally listed for with agent #1, which is $35,000 more than the price when it expired with the last agent.

It Still Won’t Sell

If they really wanted to sell, this is NOT the way to do it. They should just take it off the market, because they are not “in” the market.

Raising their price will not sell this home. Now, though, it has been on the market for over a year, which makes homebuyers wonder what is wrong with the home. It also tells me they are stubborn about their price. This homebuyer – that’s me, will not look at a home where it is apparent the sellers are stubborn AND overpriced.

 

Tags: ,

Authored by Paula | Discussion: No Comments »

« Previous Entries

Next Entries »