It has been recently reported that a new “scam” is taking place in Broward County involving unoccupied homes that are REO’s (bank owned) or Short Sales.  A group of people have found a loophole in the system and they are taking  ADVERSE POSSESSION , (see Adverse Possession without color of title (Fla. Stat. section 95.18).

 Upon taking possession of the home they rent the homes to other individuals and they file a QCD (Quit Claim Deed). There is nothing the police or the Clerk of Courts can do to prevent it.  In a quick search of records,  over 150 filings have taken place since late last year.

Realtors who list these properties are forced to evict the tenants, who through no knowledge of their own have rented the property. In some cases the Realtors have  to pay off the people who filed the QCD  or take them to court to prove that they do not have title in order to sell the house. 

This is a list of  of companies that have been known to participate in this activity:

1. SAVING FLORIDA HOMES
2. COLONIAL PROPERTIES
3. HELPING HANDS PROPERTIES.
4. MAS & SONS Inc.

The Obama Administration is urging participating servicers to follow through on short sales as an alternative to foreclosure for those homeowners that don’t qualify for a reworked mortgage under the the Home Affordable Modification Program (HAMP).  Banks are now reaching out to their customers to help them save their home from foreclosure. 

 Steve Harney, one of the foremost experts in real estate in our country, gave  his advice during a recent interview stating that banks have taken a softer approach in allowing homeowners to short sell their home with dignity, rather than walk away with a foreclosure on their recordthrough  The Home Affordable Foreclosure Alternatives Program (HAFA).

These are the rules of the New Economy and they apply not only to the sale of homes but to all products and services.   So, get a grip on reality and adjust your way of thinking because the old economy is not coming back.  You will know when you have priced your home to sell because you will have more than one qualified buyer bidding on your home.

In the past two weeks I listed 2 properties, both were priced below market value.  In one instance I received an offer that was $11,000.00 higher than the list price within the first  week.  On the other listing  I received an “AS IS” offer the day it went into the MLS for just under list price,  which the sellers felt was reasonable considering the repairs that had to be made to the property.

Using statistics and projections from reliable resources I was able to persuade the sellers not to price their properties above market value.  Most sellers want to leave room to negotiate and they miss the point that if their home is priced below market value they will actually get a higher price than if it is priced above market value.

Many real estate experts who study facts and trends are encouraging sellers to follow this rule in order to stop the bleeding.  There is another wave of foreclosures due to hit the market; it is known as the Shadow Inventory.  An article written by Steve Harney, entitled Dry Your Eyes and Lower Your Price gives a few more examples of how proper pricing is helping others throughout the country. 

My advice is, if your Realtor tells you it is time to reduce the price of your home….do it.

2 bedrooms/2 baths, partially fenced lot.  Perfect home for small families or empty nesters.  Extra large living room with built in bar, overhead window, sliding doors leading to patio.  Dining area also features sliding doors to covered patio.  The cozy eat in kitchen has wood cabinets and a double pantry. 

The property is located in Forest Ridge in the subdivision of Oak Park.  The monthly fee of $155.00 includes front lawn maintenance and irrigation, a pool and 8 tennis courts.

This property has a new barrel tile roof and a 2 car garage that has been partially converted.

Built in 1997, 4 bedrooms, 2.5 baths, pool, 9,014 sq. ft. lot.  This home features a large formal living room, a formal dining room, a spacious eat in kitchen and a family room.  The home is located in Forest Ridge/Southern Orchard.  The neighborhood is located adjacent to Tree Tops Park and is within walking distance to Bamford Sports Park and the Pine Island Park in Davie.

4 bedrooms, Den/Office, 3 full baths, a heated pool and spa, and a large covered patio  on a 10, 710 sq. ft. lot overlooking Pine Island Ridge. 

This is a home that says a lot about the owner.  It has been beautifully maintained and some of the rooms have been freshly painted.  The mechanics of the home are upgraded, such as a  newer 5 ton,  16.5 SEER air conditioner, a Cutler Hammer generator transfer switch, a whole house carbon water filter, a 12,000 BTU heat pump, and an alarm system wired to smoke detectors. 

The interior of the home features  approximately 3,000 sq. ft. of living space,  large room sizes, Plantation shutters, Wilson art flooring, granite kitchen counters, over-sized windows, volume ceilings, and neutral decor.  The exterior of the home features 3 outdoor electrical outlets, a fenced yard filled with palms, coconuts, avocado and mango trees, a euro-stone patio deck finish, pavered driveway and walkway, and a fantastic view.

The community offers a swimming pool and 8 tennis courts.   The maintenance fee is only $255 per quarter.  Fox Trail Elementary and Indian Ridge Middle Schools are located minutes from the property.  There is easy highway access to I-595, I-75 and the Sawgrass Expressway. 

You can view additional photos at www.obeo.com/579157

Newly listed in Forest Ridge.  This 3 bedroom 2 bath home features an S tile roof, lovelylandscaping, a zero lot and an open floor plan.  It has a total of 2,163 sq. ft. according to the MLS.  It is located in the Lake Park subdivision of Forest Ridge.  Forest Ridge is located in Davie, Florida just a few minutes south of I-595.

The new GFE will contain three pages.   Page 1 will summarize key loan information, details escrow information and displays the total estimated settlement charges associated with obtaining the mortgage so the borrower can compare loan terms.  Page 2 estimates total settlement charges associated with obtaining the mortgages, breaking them down into 11 blocks of charges.  The GFE does  not provide a figure that represents the downpayment or the cash the borrower will need to bring to the closing.  Page 3 is an instructional page designed to help borrowers understand their loan and its associated fees.  Borrowers can use the shopping guide to document and compare charges from other lenders. 

The new HUD 1 (Settlement Statement) will also increase from two to three pages and will include a side by side comparison chart to help borrowers compare final loan terms disclosed on the lastest GFE with teh charges as shown on the HUD 1.  Page 1 contains only minor formatting changes.  Page 2 renumbers and consolidates many charges differently than in the past and displays all charges as dollar amounts, not percentages.  Page 3 has been added to allow borrowers to compare charges disclosed on the latest GFE with actual costs charged on the HUD 1. This side by side comparison displays charges in categories.

In the event the HUD 1 shows an increase in a charge *( to a lender and/or third party fee) versus what was reflected on the latest GFE, the closing may be delayed.  The lender will need time to work with the setlement agent or attorney to determine if the change requires a revision to the GFE.  If a new GFE is required, it must be provided to the borrower within three business days AND at leas one day prior to closing.  This gives the borrower time to review and understand the increased charges prior to closing.  The closing may be extended up to seven business days if/when the increased charge(s) cause the APR to increase more than .125%.

A fee increase can only be charged if it occurred due to what HUD refers to as a “valid changed circumstance.” For example, if the borrower choose to make a significant change to his/her loan (such as a product change) or if a full review of the appraisal results in discovery that a survey is required, a “valid changed circumstance: has occurred, and the associated fee increases can be charged to the borrower (if a new GFE is properly issued that reflects the new fees).  Another example is if a power of attorney is needed for a borrower who cannot attend a closing.

This RESPA Reform applies to all open-end and closed-end loans but not to home equity lines of credit.  The applicant must receive his or her initial disclosures before upfront fees can be collected from the applicant.  The only exception is the credit report fee which can be collected at application.  A GFE is NOT A LOAN COMMITMENT.  It is an estimate of the total charges associated wtih obtaining the loan, regardless of who is repsonsible for paying each of those charges, but neither the borrower nor the lender is obligated to enter into the loan.  If a charge on teh HUD 1 is less than the charge on the GFE it will not cause a delay in the closing.

“The Federal Housing Administration on Wednesday announced stricter requirements for its loans, with buyers paying higher insurance premiums and having access to less cash from sellers for closing costs.

Also, borrowers who want to put the minimum 3.5 percent down for FHA loans must have credit scores of at least 580. Those with less than 580 will have to put down at least 10 percent. Previously, FHA did not require a minimum credit score.

FHA loans are popular with many first-time buyers because of the low down payment requirements.
Under the new rules, insurance premiums will be 2.25 percent of the value of the loans. That’s up from 1.75 percent.
The most sellers can contribute to buyers’ closing costs will drop to 3 percent of the value of the home. The percentage now is 6 percent.

FHA Commissioner David Stevens said in a statement that the changes will strengthen the agency’s capital reserves and allow it to continue to provide homeownership for many Americans.”

“Striking the right balance between managing the FHA’s risk, continuing to provide access to underserved communities, and supporting the nation’s economic recovery is critically important,” Stevens said. “When combined with the risk management measures announced in September of last year, these changes are among the most significant steps to address risk in the agency’s history.”