More homes sell for less than asking price

MIAMI – Dec. 13, 2018 – According to the National Knock Deals Forecast, uses data for both predictive and historical analyses from ATTOM Data Solutions, the percent of home sellers who eventually sold for less-than-asking price in 2018 was about 2 in 3 (62 percent).

Of those homes that sold for less than asking price, six out of 10 are in the South, with Miami at No. 1, followed by New Orleans and Chicago.

As home values rise more slowly, Knock predicts that the trend of lower sale prices will continue into 2019, when 77 percent of on-the-market listings will sell for less than asking price, and half of the “top 10 markets for deals” will be in the South.

“Knock has developed six predictive algorithms to determine how much our Home Trade-in customers’ homes will sell for and when,” says Sean Black, co-founder and CEO of Knock. “By applying these algorithms … we hope to help more home buyers find and act on the best deals, and increase overall market fluidity.”

Knock analyzed on-market listings in the largest U.S. MSAs to determine the markets with the highest percentage of homes predicted to sell below their original list prices, what Knock defines as a “deal.” In November, Knock said that 80 percent of U.S. homes sold within 4 percent of its predicted final sale price, and 50 percent sold within 2 percent of the predicted final sale price.

The number one predicted MSA for deals heading into 2019, Miami, also saw the highest rate of deals in 2018.

“While there’s no denying that home prices have been steadily on the rise, list prices are clearly increasing above realistic levels, corroborated by the study’s findings that over 60 percent of homes sold well below their original list prices in 2018,” says Paul Habibi, economic advisor to Knock and Lecturer at UCLA Anderson School of Management.

The tendency to overprice

While the rate of home price increases has begun to slow, it’s still up 5.1 percent year-over-year, according to the S&P CoreLogic Case-Shiller Indices. As prices have gone up, so have home sellers’ expectations of their home values, and there’s a tendency to list a home for a bit more than recent nearby sales.

When sellers price homes aggressively, however, they can sometimes end up selling it not just below their original list price, but also below market value because buyers wonder about a home that has been on the market for a longer period of time.

For homes sold in November, Knock found that 92 percent of listings that had been on the market two months or more sold below their list prices – 22 percent more than the rate of all listings that sold below their original list prices in November. On average, these homes sold for 1.5 percent less than the overall market.

In Miami, for example: 76 percent of listings sold at least 2 percent below original list prices, compared to 3 percent of listings selling 2 percent or more above original list prices. The ratios are different in a market like San Francisco, where 58 percent of listings sold at least 2 percent above original list prices. But given that the majority of all U.S. listings still sold 2 percent or more below list price, underpriced markets appear to be the exception rather than the norm.

Based on predictions of all listings that hit the market in the past six weeks, five out of the 10 top markets for deals are in the Southern half of the U.S. Miami continues to top the list, with Houston, Texas, Jacksonville, Fla., New Orleans, La. and Tampa, Fla. also having some of the highest predicted rates of deals heading into 2019.

“Given that the slowdown of home price increases is just beginning to take hold, we can expect home sellers to continue to set their original list prices on the higher end, which has the potential to result in greater deals for home buyers,” Knock says it a news release. “Particularly as we head into January, which has historically been one of the best months for deals, the combination of seasonality and the slowing market make the perfect recipe for the increased rate of deals.”

I AM A VETERAN by Andrea Christensen Brett

You may not know me the first time we meet
I’m just another you see on the street
But I am the reason you walk and breathe free
I am the reason for your liberty
I AM A VETERAN

I work in the local factory all day
I own the restaurant just down the way
I sell you insurance, I start your IV
I’ve got the best-looking grandkids you’ll ever see

I’m your grocer, your banker
Your child’s schoolteacher
I’m your plumber, your barber
Your family’s preacher
But there’s part of me you don’t know very well
Just listen a moment, I’ve a story to tell
I AM A VETERAN

I joined the service while still in my teens
I traded my prom dress for camouflage greens
I’m the first in my family to do something like this
I followed my father, like he followed his

Defying my fears and hiding my doubt
I married my sweetheart before I shipped out
I missed Christmas, then Easter
The birth of my son
But I knew I was doing what had to be done

I served on the battlefront, I served on the base
I bound up the wounded
And begged for God’s grace
I gave orders to fire, I followed commands
I marched into conflict in far distant lands

In the jungle, the desert, on mountains and shores
In bunkers, in tents, on dank earthen floors
While I fought on the ground, in the air, on the sea
My family and friends were home praying for me

For the land of the free and the home of the brave
I faced my demons in foxholes and caves
Then one dreaded day, without drummer or fife
I lost an arm, my buddy lost his life

I came home and moved on
But forever was changed
The perils of war in my memory remained
I don’t really say much, I don’t feel like I can
But I left home a child, and came home a man

There are thousands like me
Thousands more who are gone
But their legacy lives as time marches on
White crosses in rows
And names carved in queue
Remind us of what these brave souls had to do

I’m part of a fellowship, a strong mighty band
Of each man and each woman
Who has served this great land
And when Old Glory waves
I stand proud, I stand tall
I helped keep her flying over you, over all

I AM A VETERAN

Proclamations


Presidential Proclamation on National Veterans and Military Families Month, 2018
Veterans

Issued on: October 31, 2018


During National Veterans and Military Families Month, we salute the brave and dedicated patriots who have worn the uniform of the United States, and we celebrate the extraordinary military families whose selfless service and sacrifice make our military the finest in the world.

Our Nation’s veterans represent the best of America. Generation after generation, men and women have answered the call to defend our country and our freedom, facing danger and uncertainty with uncommon courage. They make tremendous sacrifices by leaving their families to serve throughout the homeland and in combat, contingency, and humanitarian operations worldwide.

Our heroes have always relied on their families for strength and support. Serving alongside our men and women in uniform are spouses, siblings, parents, and children who personify the ideals of patriotism, pride, resilience, service above self, and honor. They endure the hardships and uncertainty of multiple relocations, extended trainings, and deployments because of their admirable devotion to our country and a loved one in uniform.

President Ronald Reagan said, “America’s debt to those who would fight for her defense doesn’t end the day the uniform comes off.” Our Nation’s veterans fulfilled their duty to this country with brave and loyal service; it is our moral and solemn obligation to demonstrate to them our continuing gratitude, unwavering support, and meaningful encouragement.

I am steadfastly committed to ensuring our veterans and their families receive the care and support they deserve. I was pleased to sign into law the landmark VA MISSION Act of 2018, which revolutionizes the way veterans receive healthcare and other services vital to their lives. The Department of Veterans Affairs is continuing to raise its standard of service, including through the establishment of the first national center of excellence for veteran and caregiver research, which will improve services and outcomes for patients and their families. I have also mandated greater collaboration across the Government to support veterans transitioning to civilian life. Additionally, Second Lady Karen Pence and I have collaborated on ways to elevate the career and educational opportunities for military spouses and children in partnership with State, local, and tribal officials.

It is most appropriate that in this season of gratitude we stop to recognize veterans, military families, and those who gave their lives in service to this great Nation. We are indebted to these heroes for the freedoms we enjoy every day. I ask all Americans to join me in offering our sincere thanks to our veterans and the families who love and support them.

NOW, THEREFORE, I, DONALD J. TRUMP, President of the United States of America, by virtue of the authority vested in me by the Constitution and the laws of the United States, do hereby proclaim November 2018 as National Veterans and Military Families Month. I encourage all communities, all sectors of society, and all Americans to acknowledge and honor the service, sacrifices, and contributions of veterans and military families for what they have done and for what they do every day to support our great Nation.

IN WITNESS WHEREOF, I have hereunto set my hand this thirty-first day of October, in the year of our Lord two thousand eighteen, and of the Independence of the United States of America the two hundred and forty-third.
                                        DONALD J. TRUMP

Kiplinger: Fla. No. 4 tax-friendly state – and top 3 are cold

NEW YORK – Oct. 17, 2018 – The economy is booming, with the unemployment rate at the lowest level in nearly 50 years. Wages have remained relatively stagnant, though, and for many workers, the only way to get a raise is by changing jobs, which sometimes means moving to another city or state.
But before you start packing, check out the cost of living in your prospective employer’s city. You’ll want to look at the cost of housing, of course, and don’t overlook the impact of state and local taxes on your bottom line. Our annual guide to state taxes shows that tax rates are literally all over the map – and the difference between living in a high-tax or a low-tax state can be thousands of dollars each year, depending on your tax situation.
Updated for 2018, here is our list of the 10 most tax-friendly states in the U.S. The top five states on our list have no state income tax at all. Take a look.
1. Alaska
State income tax: None
Average local sales tax: 1.43 percent
Gas taxes and fees: 15 cents per gallon
Alaska gives each legal resident who has lived in the state for a full year an annual “Permanent Fund Dividend.” But the dividend has been shrinking in recent years, reflecting lower oil prices and a drop in production. This year, each legal resident will receive $1,600, down from a peak of $2,072 in 2015.
Gas taxes in the Last Frontier are the lowest in the U.S., and Alaskans pay no state income taxes or state sales taxes. While municipalities – generally those without real estate taxes – impose local sales taxes as high as 7.5 percent, the average sales tax is 1.43 percent, according to the Tax Foundation. Anchorage, Alaska’s largest city, has no sales tax. The property tax on the state’s median home value of $257,100 is $3,048. That’s slightly above the average for the U.S.
2. Wyoming
State income tax: None
Average local sales tax: 5.39 percent
Gas taxes and fees: 24 cents per gallon
How does the Equality State continue to rank near the top of our list? Generous revenues from taxes on mineral and energy extraction. Wyoming has no income tax, and its gas tax is well below the national average of 31 cents per gallon. The property tax on the state’s median home value of $199,900 is $1,223, the ninth-lowest in the U.S.
While some states with no income tax make up for lost revenue with higher-than-average sales taxes, Wyoming’s combined state and local sales tax rate of 5.39 percent is effectively the lowest in the U.S. Prescription drugs and most groceries are exempt from sales taxes. And at 2 cents per gallon, Wyoming has the lowest beer tax in the land.
3. South Dakota
State income tax: None
Average local sales tax: 6.40 percent
Gas taxes and fees: 30 cents per gallon
You’ll need to bundle up in South Dakota’s winter, but because you don’t have to pay state income taxes here, maybe you can afford to fly south for a couple of weeks in January.
South Dakota’s combined state and local sales taxes are below average for the U.S. However, while prescription drugs are exempt from sales taxes, food, nonprescription drugs and many services are taxed in the Mount Rushmore State. You can expect to start paying sales taxes on more of your online purchases, too. South Dakota brought the case that led the Supreme Court to overturn previous court rulings that made it difficult for states to collect sales taxes for online purchases. It’s planning to start collecting sales taxes from many out-of-state online retailers on November 1.
Property taxes here are above average for the U.S. The property tax on South Dakota’s median home value of $146,700 is $1,943.
4. Florida
State income tax: None
Average local sales tax: 6.80 percent
Gas taxes and fees: 41 cents per gallon
Florida has no income tax, and its property taxes are below the midpoint for the U.S. The property tax on Florida’s median home value of $166,800 is $1,702.
Average combined state and local sales taxes in the Sunshine State are about average for the U.S., although in some counties the combined rate is as high as 8 percent. Food and prescription and nonprescription drugs are exempt.
Vehicles are taxed at the state’s 6 percent sales tax rate, but a county sales tax (based on where the buyer lives) is due on the first $5,000 of the purchase price or on each lease payment.
5. Nevada
State income tax: None
Average local sales tax: 8.14 percent
Gas taxes and fees: 34 cents per gallon
The Silver State is another no-income-tax haven. Also, the property tax on Nevada’s median home value of $191,600 is $1,478, 16th-lowest in the U.S. Gas taxes are the same as the national average of 34 cents per gallon.
Nevada receives more than $1.4 billion in taxes and fees annually from the casino industry. Still, Nevada relies heavily on sales taxes to pay the bills. The average combined state and local sales tax rate is 8.14 percent. Food and prescription drugs are exempt from the state’s sales tax, but counties may tack on as much as 1.42 percent.
In addition to sales taxes, vehicle owners are charged an annual “government services tax” that’s based on the vehicle’s value and age. The tax on a two-year-old vehicle with an original sticker price of $20,000, for example, is $238.
6. North Dakota
State income tax: 1.10 percent (on taxable income of less than $38,700 for single filers or $64,650 for joint filers) – 2.90 percent (on taxable income of more than $424,950)
Average local sales tax: 6.83 percent
Gas taxes and fees: 23 cents per gallon
The Peace Garden State imposes only modest sales taxes that favor agriculture (new farm machinery is taxed at only 3 percent), and its income tax rates are relatively minuscule, even for high earners. Gas taxes are well below the national average. Food and prescription drugs are exempt from sales taxes. Alcoholic beverages are taxed at 7 percent.
The property tax on the state’s median home value of $164,000 is $1,729, just below the average rate for the U.S.
7. Delaware
State income tax: 2.2 percent (on taxable income of $2,001 to $5,000) – 6.6 percent (on taxable income of more than $60,000)
Average local sales tax: None
Gas taxes and fees: 23 cents per gallon
Delaware’s income tax rate escalates quickly. Residents with taxable income of $60,000 or more (both single and joint filers) pay the top rate of 6.6 percent, and the capital city of Wilmington imposes its own wage tax of 1.25 percent.
There’s a reason Delaware’s Rehoboth Beach outlets are packed even when the sun is shining: The First State has no sales tax. And shoppers are inclined to gas up on their way home because Delaware’s gas taxes are well below average.
Property taxes as a percentage of home value are the fourth-lowest in the U.S. The property tax on the state’s median home value of $233,100 is $1,274, according to the Tax Foundation.
Little Delaware, sandwiched between high-tax states such as Maryland and New Jersey, pulls off this low-tax trick by being a very friendly place for businesses to incorporate, and then collecting fees and taxes from these absentee businesses, whose real operations are elsewhere.
8. Arizona
State income tax: 2.59 percent (on taxable income of less than $10,346 for single filers or $20,690 for joint filers) – 4.54 percent (on taxable income of more than $155,159/single or $310,317/joint) Income levels are for the 2017 tax year.
Average local sales tax: 8.38 percent
Gas taxes and fees: 19 cents per gallon
Arizona’s top income tax rate of 4.54 percent doesn’t kick in until taxable income exceeds $155,159 for single filers or $310,317 for married couples filing jointly.
The property tax on the state’s median home value of $176,900 is $1,367, below average for the U.S. And at 19 cents per gallon, state gas taxes are well below the national average of 34 cents per gallon.
Like most states, the Grand Canyon State excludes prescription drugs and food for home consumption from state sales taxes. However, all 15 counties levy additional taxes, as do many municipalities, and some jurisdictions extend their taxes to groceries. The average combined state and local sales tax rate is 8.38 percent, the 11th-highest in the U.S., according to the Tax Foundation.
While the gas tax is low, car owners must pay an annual vehicle license tax. The tax is based on an assessed value of 60 percent of the manufacturer’s base retail price, reduced by 16.25 percent for each year since the vehicle was first registered in Arizona. The rate is $2.89 for new vehicles and $2.80 for used vehicles, for each $100 of assessed value. For example, for a new vehicle that costs $25,000, the assessed value in the first year would be $15,000 – and the corresponding license tax would be $420.
9. Mississippi
State income tax: 3 percent (on more than $1,000 of taxable income) – 5 percent (on more than $10,000 of taxable income). Income tax rates are being gradually reduced. By 2022, the first $5,000 of taxable income will be exempt.
Average local sales tax: 7.07 percent
Gas taxes and fees: 19 cents per gallon
Mississippi is moving to ease its income tax bite on the lowest-earning residents. Starting in 2018, the first $1,000 of taxable income is exempt from the 3 percent rate. By 2022, that bracket will be completely gone, and the income tax will start at 4 percent of $5,000 of taxable income.
Gas is taxed at 19 cents per gallon, one of the lowest rates in the U.S. Vehicle sales are taxed at 5 percent, two percentage points below the general sales tax rate. Mississippi also charges an annual personal property tax based on vehicles’ age and value. Rates are set at the county level. (In Lafayette County, for example, you’d pay $285 on a vehicle valued at $20,000.)
The property tax on the Magnolia State’s median home value of $105,700 is $841, the 19th-lowest in the nation. Mississippi’s state sales tax rate of 7 percent is the second-highest in the U.S. (only California, at 8.25 percent, is higher), and Mississippi is one of a minority of states that charges sales tax on groceries. But prescription drugs, residential utilities, motor fuel and newspapers are all exempt, and localities add very little on top of the state’s rate, if anything.
10. Louisiana
State income tax: 2 percent (on taxable income of less than $12,500 for single filers or $25,000 for joint filers) – 6 percent (on taxable income of more than $50,000/single or $100,000/joint)
Average local sales tax: 9.45 percent
Gas taxes and fees: 20 cents per gallon
With the third-lowest property taxes in the U.S., the Pelican State is a great place to own a home. The property tax on the state’s median home value of $148,300 is $750. Another plus: At 20 cents per gallon, Louisiana’s gas tax is well below the national average of 34 cents per gallon.
Louisiana’s top income tax rate of 6 percent kicks in at $50,000 of taxable income for a single filer. Louisiana allows residents to deduct their entire federal income tax liability, minus nonrefundable tax credits, from their state income taxes. However, as a result of the federal tax overhaul, most taxpayers are expected to see their federal taxes decline in 2018. That means Louisiana’s deduction won’t be worth as much, and state taxes here will go up. The state has a budget shortfall of more than $1 billion, so lawmakers are unlikely to approve measures that would reduce the tax hike.
Local parishes and jurisdictions can add their own levies to the state sales tax, boosting the average combined rate to 9.45 percent, the second-highest in the country. In some jurisdictions, sales taxes are as high as 12 percent.
About our methodology
To create our rankings, we evaluated data and state tax-policy details from a wide range of sources. These include:

  • Income Taxes
    We looked at each state’s tax agency, plus this helpful document from the Tax Foundation. Rates and brackets are for the 2018 tax year unless otherwise noted.
  • Property Tax
    Median income tax paid and median home values come from U.S. Census’ American Community Survey and are 2016 data.
  • Sales Taxes
    We also cite the Tax Foundation’s figure for average sales tax, which is a population-weighted average of local sales taxes. In states that let municipalities add sales taxes, this gives an estimate of what most people in a given state actually pay, as those rates can vary widely.
  • Fuel Tax
    The American Petroleum Institute
  • Sin Taxes
    Each state’s tax agency as well as the Tax Foundation
  • Inheritance & Gift Taxes
    Each state’s tax agency.
  • Wireless Taxes
    The Tax Foundation
  • Travel Taxes
    Each state’s tax agency, plus a lodging tax study published in 2015 by HVS Convention Sports and Entertainment Consulting.
  • Fiscal Stability
    Each state’s balance sheet gives an indication of what its tax future might look like. We drew on the study Ranking the States by Fiscal Condition by the Mercatus Center at George Mason University.

Copyright © 2018 The Kiplinger Washington Editors; Sandra Block, senior editor, Kiplinger’s Personal Finance; David Muhlbaum, senior online editor, Kiplinger.com

Zero-down loan program aims to expand mortgage access

MIAMI – Oct. 16, 2018 – A new effort is underway to raise the low homeownership rate among underserved groups of homebuyers.

The Neighborhood Assistance Corp. of America (NACA) is hosting several events across the country to help borrowers with low credit scores apply for 15- or 30-year mortgages with cheaper interest rates. One recent event in Miami drew thousands looking for a chance to get a no-downpayment, low-interest-rate mortgage. NACA officials say more than 10,000 potential borrowers have attended various NACA events in cities such as Charlotte, N.C., and Atlanta.

“The low rate of homeownership and number of mortgages for low- and moderate-income people, and for minority home buyers, is a national disgrace,” NACA CEO Bruce Marks told CNBC. “There have been zero foreclosures among the loans that we’ve originated in the past six years.” Bank of America is backing the NACA program with $10 billion in mortgage commitments.

To qualify, borrowers must go through an education session about the program, as well as counseling for budget planning, to make sure they can afford a mortgage payment. They also must submit all necessary documents, including income statements and phone bills.

The program serves only those who are buying a primary residence, not an investment property. The loans for 15- or 30-year fixed-rate mortgages are below market, at around 4.5 percent.

“That’s what’s going to help people who’ve been locked out of homeownership really become homeowners and build wealth,” Marks told CNBC.

However, critics of the program worry that loans with a no-downpayment requirement could carry too much risk.But program officials say buyers have “skin in the game in a real way,” meaning it’s their home and an investment for their family.

“We have seen significant wins in this partnership,” A.J. Barkley, senior vice president of consumer lending at Bank of America, said. “Just to be clear, when we get those loans with all the heavy lifting here, we’re over a 90 percent approval, meaning we actually underwrite the loans for 90 percent of the people who go through this program.”

Source: “Thousands Line Up for Zero-Down Payment, Subprime Mortgages,” CNBC (Oct. 12, 2018)

VA GUIDANCE ON NATURAL DISASTERS

                                  INFORMATION FOR VETERAN BORROWERS
If you have a VA loan and your home was affected by a natural disaster, we encourage you to take the steps listed below to ensure you receive the assistance you need.

(1) Contact FEMA (Federal Emergency Management Agency)
Begin the disaster application process online at www.DisasterAssistance.gov or by calling 800‐621‐3362. In order to receive the maximum assistance, you must register with FEMA before their deadline expires. Do not pay your loan in full before checking with the Small Business Administration (SBA) regarding a loan for the uninsured portion of your loss. Additional support, including low‐interest loans, cash grants, and housing assistance may be available from agencies associated with the disaster recovery effort. For more information, go to www.fema.gov.

(2) Contact Your Mortgage Company
You are responsible for making regular monthly loan payments, even if your home is
not habitable, so contact your lender as soon as possible regarding your loss. If you are unable to make payments on time, we encourage you to discuss forbearance or a loan modification. Also have your lender explain procedures for insurance loss checks, repairs to your property, payments to contractors,etc.

(3) Contact Your Insurance Company
File an insurance claim as soon as possible; however, do not make a hasty settlement on insurance. When the property is damaged but repairable, attempt to get your local engineer’s office to inspect your home for structural damage. If possible, get at least two estimates from licensed contractors for cost of repairs or rebuilding. ‐‐ Insurance checks for personal property and living expenses should be payable to you only. Checks for damage to your home should be payable to both you and your mortgage company.

(4) Change your Address
If you are receiving a monthly benefit check from VA or another source and you will not be able to receive mail at your regular address, notify your local post office and VA Regional Office (http://www.benefits.va.gov/HOMELOANS/contact_rlc_info.asp)of your change of address. For information on other VA benefits, call 800‐827‐1000.

(5) Check Other Sources for Assistance
Contact local offices of the American Legion, Veterans of Foreign Wars, Disabled American Veterans (DAV) or other veterans’ organizations to see if special assistance may be available, even to non‐members of the organization.

INFORMATION FOR MORTGAGE LENDERS

Lenders must check with FEMA to obtain the specific counties and corresponding declaration dates (https://www.fema.gov/disasters) along with any amendments to the declaration.

Loan Closed Prior to Disaster. Any loan closed prior to the date of the declared disaster is eligible for VA Guaranty without regard to the disaster. The “Information for Mortgage Servicers” section below applies to these cases.
Properties Appraised Prior to Disaster. If the property was appraised on or before the date of the declared disaster and not closed prior to that date, the following items must be submitted with the VA guaranty request:

(1) Lender Certification

This is to affirm that the property which is security for VA loan_______________ number has been inspected to ensure that it was either not damaged in the recently declared disaster or has been restored to its pre‐disaster condition or better.

_______________________   ________________     _______
(Lender Signature)        (Lender Title)         (Date)

(2) Veteran Certification

I have inspected the property located at __________________________ and find its condition now to be acceptable to me. I understand that I will not be charged for any disaster‐related expenses and now wish to close the loan.

___________________________    _____________
(Veteran Signature)               (Date)
(3) VA Loan Summary Sheet (VA Form 26‐0286).

The Remarks section of this form must be annotated “Lender and Veteran Disaster Certifications Enclosed.” Additionally, if local law requires the property to be inspected and approved by the local building inspection authority, a copy of the appropriate local report(s) must be provided. Neither VA nor the veteran purchaser shall bear the expense of any disaster‐related inspection or repairs.
(4) Decline in Value.

If there is an indication that the property, despite repairs, will be worth less at the time of loan closing than it was at the time of appraisal, the lender must have the VA appraiser update the original value estimate. The payment of the appraiser’s fee for that service will be a contractual matter between the buyer and seller. If the property value has decreased, the loan amount must be reduced accordingly.
(5) Employment/Income Certification.

Lenders must confirm prior to closing that the veteran’s employment and income have not changed since the loan application. If at time of closing the veteran or co‐borrower is no longer employed or income has been reduced, this information should be reported to VA or the automatic underwriter, as appropriate, for evaluation prior to closing.

INFORMATION FOR MORTGAGE SERVICERS

Mortgage servicers must check with FEMA to obtain the specific counties and corresponding declaration dates (https://www.fema.gov/disasters) along with any amendments to the declaration

Assistance to Homeowners. VA encourages servicers of guaranteed loans in disaster areas to extend all possible forbearance to borrowers in distress. VA regulations on Prepayments (38 CFR 36.4311), Advances (38 CFR36.4314), Loan Modifications (38 CFR 36.4315) and Supplemental Loans (38 CFR 36.4359) may be of assistance in appropriate cases. It is the loan holder’s responsibility to counsel borrowers concerning assistance that may be available.
Moratorium on Foreclosures. Although the loan holder is ultimately responsible for determining when to initiate foreclosure and complete termination action, VA encourages holders to establish a 90‐day moratorium on initiating new foreclosures in the disaster area.
Insurance Requirements. VA regulations (38 CFR 36.4329) require that lenders and holders ensure that homes financed with VA‐guaranteed loans be sufficiently insured against hazards. Insurance proceeds are to be applied to the restoration of the security or the loan balance. The burden of proof is upon the holder to establish that no increase in VA’s ultimate liability is attributable to failure of the holder to have the property properly insured or properly apply an insurance loss settlement.

Case‐specific appraisal, origination and servicing issues may be directed to the appropriate VA Regional Loan Center (http://www.benefits.va.gov/HOMELOANS/contact_rlc_info.asp).

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Home Loans and Housing-Related Assistance

VA Home Loans and Housing-Related Assistance

VA home loan programs may be used to obtain homes, condominiums, or manufactured homes; refinance an existing home loan; or install energy-saving improvements. VA offers these three main types of guaranteed home loan benefits:

  • Purchase Loans
  • Cash-Out Refinance Loans
  • Interest Rate Reduction Refinance Loans
Native American Veterans

For Native American Veterans who want to live on Federal Trust land, VA’s Native American Direct Loan (NADL) program is another option. It provides direct loans to eligible Native American Veterans for the purchase, construction, or improvement of a home. Learn more about NADL.

Adapted Homes for Disabled Veterans

VA also offers grants to Veterans with certain service-connected disabilities to build an adapted home or install ramps, widen doors, or make other modifications to live more independently. VA operates three types of grants that accommodate Veterans’ unique circumstances: Specially Adapted Housing, Special Housing Adaptation, and Temporary Residence Adaptation.

Help for Homeless Veterans

If you are homeless or at imminent risk of becoming homeless, contact your local VA medical center; call 877-4AID-VET (877-424-3838); or visit va.gov/homeless. VA can connect you with the care you need to get back on your feet.

Underwriting

Private-sector lenders underwrite and fund VA home loans according to established VA standards. VA’s partial guaranty for these loans means that nearly 90 percent of all VA-guaranteed home loans are made with no down payment required.

Delinquency

If a VA-guaranteed loan becomes delinquent, VA works with the borrower to avoid foreclosure, including providing financial counseling and, in some cases, direct intervention with a mortgage loan servicer on the borrower’s behalf. In 2013, VA loans had the lowest foreclosure rate of all types of loans in the market. If you are a Veteran or Servicemember having difficulty making mortgage payments, call 877-827-3702 to speak with a VA Loan Technician. More information about avoiding foreclosure is at http://benefits.va.gov/HOMELOANS/resources_payments.asp.

Borrowers

Borrowers must have suitable credit, sufficient income, and a valid Certificate of Eligibility (COE) to be eligible for a VA-guaranteed home loan.

VA Requirements

Home Loans
  • Suitable credit and sufficient income
  • A valid VA home loan COE that verifies to lenders that you qualify for benefits
  • DD-214 or other applicable service documents
  • Certification that you will occupy the home
  • Other documents as needed for obtaining a home loan
Specially Adapted Housing (SAH) Grants
  • A rating by VA that you are as medically eligible for SAH grant benefits
  • Evidence that it is considered medically feasible for you to live in the proposed housing unit and locality
  • A proper relationship between the cost of the proposed housing and your current and future income and expenses
  • Suitability of the dwelling to your needs
  • Proof of ownership, such that the property can be adapted

VA Application Process

Home Loans
  • Use this detailed table to determine the specific evidence you need to obtain a home loan COE.
  • Prepare all documents and evidence before completing an application for a COE.
  • Obtain a home loan COE through eBenefits.va.gov, your lender, or the Atlanta Eligibility Center.
  • Once a VA COE for home loan benefits is obtained, contact several lenders who participate in the VA program to find out which one will offer the most favorable terms for your unique situation.
  • Work with the lender you select throughout the remainder of the home buying process. View this page for an illustration of the process.
Specially Adapted Housing Grants
  • Fill out and submit VA Form 26-4555, Application in Acquiring Specially Adapted Housing or Special Home Adaptation Grant.

Veterans benefits scam alert: Beware of scammers impersonating VA attorneys

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VA is currently investigating a telephone scam involving an individual or individuals impersonating VA Office of General Counsel  attorneys. The perpetrator reportedly calls Veterans and requests money to process their claims for benefits. Veterans have been given actual VA attorney names and phone numbers to call back. It is important to know that VA — as a cabinet-level agency of the U.S. government, funded by Congress — will never request payment for carrying out our mission to serve Veterans.

If you are contacted by a scammer:
  1. Know that VA will never call you and request money, even if you see “Veterans Affairs” on your caller identification.
  2. Do not give out any personally identifiable information or other personal or sensitive data such as financial and banking information.
  3. Hang up the phone immediately.
  4. Report the incident to your state’s attorney general: naag.org/naag/attorneys-general/whos-my-ag.php.
  5. File a complaint using the Federal Trade Commission’s Complaint Assistant, ftccomplaintassistant.gov/GettingStarted?NextQID=216&Selected=t#crnt.
If you believe you are a victim of this scam and you provided personally identifiable information:
  1. Request a free credit report from annualcreditreport.com.
  2. Watch for any fraudulent charges or activity on your accounts.
  3. Visit identitytheft.gov to obtain a personalized recovery plan and other resources.
If you provided money to the scammer:

Report the incident to your state’s attorney general immediately and contact your financial institution.

For additional information on Identity Theft:

Visit VA’s More Than a Number website at www.va.gov/identitytheft for tips and resources on identifying and preventing identity theft and fraud.

Things to know to build a home using a VA construction loan

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In a previous VAntage Point post, The Plan Collector blogged about how a Veteran could build a new home. They mention that construction to permanent loans can be “difficult to find.” Two years later, more and more lenders are now offering this one-time close product.
However, before you run out to build your dream home with no money down, take a few minutes to read and understand some the guidelines and requirements with this program.
First, you will need a licensed, insured builder that is willing to submit documentation to become an approved builder. The VA program does not allow for owner/builders. While the VA only requires that the builder be registered to participate in the program, each lender can require the builder to go through an approval process.
The borrower and the builder must submit a complete set of plans and specs for the home when applying. Additional forms will be sent to the builder to describe the specific materials to be used and the lot and surrounding area of the future home site.
The builder takes on more responsibility with this loan than with a 20 percent down conventional loan. It’s best to have your builder and lender speak and discuss this early in the process.
Closing costs are a part of the builder’s responsibility. The borrower can pay the closing costs normally associated with a purchase loan, but the builder must pay for all the construction loan closing costs and interest during closing. The VA will allow the builder to incorporate these costs into the agreement to build with the borrower.
Make sure you are building a home that is common in size and design for the area. The home must be appraised per the plans and specs given to the appraiser. If a borrower over builds for the area, or builds an uncommon home, the appraisal may come in lower than needed for a zero down payment.
Don’t build on land that is larger than what would be considered “standard and customary” for the area. The appraiser may feel that some of the land is excessive and again, you may find that the appraisal falls short of what is needed.
Finally, keep in mind that this process takes 45-60 days to process, with an experienced loan officer. If you are purchasing the land as part of this loan you will want to set the proper expectations with the land seller.
FHA and VA construction loans are in the deep end of the mortgage pool. Make sure you are working with a loan officer that understands the program.


About the author: Jerry Thomas is a construction loan officer with 23 years of experience and specializes in VA construction loans.