NSP-1 First Look Program It’s Up To Us! Neighborhood Stabilization Through Statewide Partnership
NSP-1 First Look Program Nobody said it would be easy! BUT We Can Do it Together!!
NSP-1 First Look Program Terms and Acronyms used in the Foreclosure Process Appraised Value The value of a property determined from an appraisal. Kentucky’s NSP guidelines require that all NSP-assisted acquisitions must be at least a 1% discount from the appraised value (though more than 1% would be great). The appraisal must have been done within 60 days of the final offer to purchase. Closing Statement (HUD-1) Known as Settlement Statement, a closing statement is a document signed by the buyer and seller at the loan closing. It shows the original purchase price, fees paid, the buyer's loan amount, the repayment terms, and the amount of funds the seller will receive in the transaction. For NSP, on the HUD-1 you should call the financing to the homebuyer closing costs and principal reduction (not down payment).
NSP-1 First Look Program Terms and Acronyms used in the Foreclosure Process REO (Real Estate Owned) Property owned by the lender; title has passed from the former owner (borrower) to the lender. Deed-in-Lieu of Foreclosure The transfer of title (ownership) of a property, from a borrower who is delinquent on their loan back to their lender to satisfy the balance due on the delinquent loan. The transfer is made voluntarily so that the borrower can avoid foreclosure proceedings. For NSP, this is one way to buy a foreclosed house without the property having been sold through Master Commissioner sale.
NSP-1 First Look Program Terms and Acronyms used in the Foreclosure Process NSP Definition: Abandoned . A home is abandoned when mortgage or tax foreclosure proceedings have been initiated, no mortgage or tax payments have been made by the property owner for at least 90 days, AND the property has been vacant for at least 90 days. NSP Definition: Foreclosed. A property has been foreclosed upon at the point that, under state or local law, the mortgage or tax foreclosure is complete. HUD generally will not consider a foreclosure to be complete until after the title for the property has been transferred from the former homeowner under some type of foreclosure proceeding or transfer in lieu of foreclosure, in accordance with state or local law.
NSP-1 First Look Program <ul><li>There is not a “right” or “wrong” approach to buying a foreclosed home. Each individual will develop his or her own approach and methods to procure REO (Real Estate Owned) properties. Some suggestions include: </li></ul><ul><li>Develop a housing list (pre-foreclosures, foreclosures). </li></ul><ul><li>Monitor each property weekly. </li></ul><ul><li>You must be persistent with your calls; you want to be the first person the contact thinks of when a property becomes available. </li></ul><ul><li>You have to be persistent when making offers; the first or second offer is not always accepted. </li></ul><ul><li>The key is to gain advantage on other investors by communicating with banks, Realtors and asset companies and Master Commissioner. </li></ul>
NSP-1 First Look Program <ul><ul><li>Get the Property History </li></ul></ul><ul><li>If you’re working with a Realtor, ask the agent to help you research the property. If not, you should know the following on each and every property: </li></ul><ul><li>Who is the present owner? </li></ul><ul><li>What is the amount owed on the mortgage note of the defaulted </li></ul><ul><li>loan and any other liens on the property? </li></ul><ul><li>What is the amount the lender paid at the Master </li></ul><ul><li>Commissioner’s sale? </li></ul><ul><li>Compare the loans that were once secured by the property and the foreclosure sale price. The lender will likely accept an offer that is between the two amounts. </li></ul>
NSP-1 First Look Program <ul><li>Analyze Listing Agent's REO Sales </li></ul><ul><li>Most REO agents work for one or two lenders. </li></ul><ul><li>Some listing agents are exclusive listing agents for REOs, and they do not list any other type of property. </li></ul><ul><li>Since REO agents deal in volume, they typically apply the same pricing principles to all their REO listings. </li></ul><ul><li>Ask your agent to look up the listing agent in MLS (Multiple Listing Service). </li></ul><ul><li>Run a search using the listing agent's name to find the last three to six months of that agent's listings. </li></ul><ul><li>Pull the history of those listings to determine the list-price to sales-price ratio. </li></ul>
NSP-1 First Look Program Common Problems Securing Properties for NSP: Difficulty acquiring foreclosed homes within HUD guidelines IT’S REALLY NOT THAT TOUGH!!! Let’s Look at Eligible Use B: (B) purchase and rehabilitate homes and residential properties that have been abandoned or foreclosed upon, in order to sell, rent, or redevelop such homes and properties; also included is foreclosed or abandoned vacant land that is currently designated for residential use, e.g. through zoning.
NSP-1 First Look Program Low-Income Set-Aside NO SWEAT!!!! If you are buying a property that you plan to use toward your low-income set-aside funds, you must make sure it is foreclosed or abandoned residential property . You cannot buy Eligible Use B properties at Master Commissioner sales as the title has not changed hands. You can purchase Eligible Use B properties following deed in lieu prior to the Master Commissioner sale.
NSP-1 First Look Program Purchasing a FHA (HUD)-Foreclosed Home To purchase a HUD owned home, you MUST have a NAID number issued by HUD to access the M&M (Management & Marketing) vendor’s website. Please contact Anne Chaney if you need to apply for a NAID number. After receiving your NAID number your will have access to BID on HUD homes. (Several of you should have already received your NAID #.) Remember – This is a BID process!
NSP-1 First Look Program <ul><li>Pyramid Realty, HUD’s M&M Contractor for Kentucky: </li></ul><ul><li>Will not sign and return acknowledgment of the URA voluntary acquisition notice. It’s best to send this notice certified mail with return receipt so that you can document the notice was provided (there is nothing else required of you). </li></ul><ul><li>Pyramid can’t certify vacancy retroactive to 2/17 (bona fide tenant) but has provided a blanket email that all units are vacant at time of listing unless otherwise noted. Be sure to check the listing!! </li></ul>
NSP-1 First Look Program HUD foreclosed housing website: https:// www.bidselect.com/servlet/RouterServlet?p_build_page = PSPropertySearchCriteria&siteid =62519&p_state_listings=KY *Make sure you choose “neighborhood stabilization program” for the Government Foreclosure Programs and Buyer Time selections. *This website is pretty self explanatory, but let us know if you start using it and have difficulties. This is a backdoor website for HUD houses may be easier to access for some. http:// homesales.gov/homesales/mainAction.do?pageAction = NOTE: This is the time to ask questions or comment on difficulty on websites purchases.
NSP-1 First Look Program <ul><li>DLG Initiatives, In Partnership With You </li></ul><ul><li>Bank of America – DLG has signed an initiative with Bank of America to established program where Kentucky NSP subgrantees have the ability to look at a BoA foreclosed property before it is listed with a Realtor for sale. DLG staff will research BoA foreclosures within targeted Census tracts and email to partners as foreclosed units are available (usually, twice weekly). If you are interested, please contact either Roy or Sara and they will assist you with the next steps in BoA’s process. BoA will provide access to the property upon confirmation that the property is secure and available for inspection. You will have seven (7) business days to complete the inspection, after receipt of Sellers notification of property availability and contact information to schedule an inspection. </li></ul>
NSP-1 First Look Program <ul><li>DLG Initiatives, In Partnership With You </li></ul><ul><li>PNC Bank – PNC has been provided with a complete list of names and email addresses for each partner; you should be receiving email lists of properties available. If you are not receiving this list please let us know and we will make sure you are added. </li></ul><ul><li>Kentucky Housing Corporation – KHC has also added the current inventory of REO properties to the web which is located at http://kyhousing.org/apps/REO/ . The page offers several ways to search for properties (i.e. county, city, etc.) or you can select a complete list of properties. Also, if you would prefer to have the list of properties emailed to you click on the subscribe to egram link just under the search area and subscribe to each county in your service area. (If you have more than one county then you will have to sign up for each one.) </li></ul>
NSP-1 First Look Program FREDDIE MAC WEBSITE http:// www.homesteps.com The link above will take you to Freddie Mac’s M&M vendor (HomeSteps); this is a simple website that you search for properties and select the properties of interest and the site will give you the contact information and expanded description of property.
Asset Companies <ul><li>These websites are for asset companies (companies hired by lenders to sell their REO properties): </li></ul><ul><li>http:// www.pasreo.com/pasreo/public/content.do?pageID =2000576 </li></ul><ul><li>To best use this site: </li></ul><ul><li>*Click “Property Search,” Select KY and your county, a list of any available properties in your area should appear. If you have more than one county, you can select all of KY and filter from there. </li></ul><ul><li>*After you get the results for your area, if you select “Print Property Reports (CSV),” you will get an excel sheet with all available properties and contact information for the listing agent and the Wells Fargo contact. </li></ul>NSP-1 First Look Program
Asset Companies <ul><li>http://www.lps-am.com / </li></ul><ul><li>http://www.iasreo.com/ias360.html </li></ul><ul><li>https:// www.emcmortgagecorp.com /EMCMORTGAGE/Logout </li></ul><ul><li>http://www.res.net/BUYER_LOGIN:1221053016.5058 </li></ul>NSP-1 First Look Program
Paid Websites <ul><li>These websites are paid websites, but the list of foreclosed houses is usually free: </li></ul><ul><li>http:// www.foreclosuredataonline.com / </li></ul><ul><li>http:// www.foreclosure.com / </li></ul>NSP-1 First Look Program
Paid Websites <ul><li>The wonderful thing about paid sites is they give you a great starting point and have a wealth of information free. You can take the information from paid websites and make a trip to the Courthouse and pull mortgage information, tax bill, deed and have all the contact information you need to get started. Visit several paid sites and take 10 to 15 address to the courthouse at a time and cull the ones that don’t pan out. </li></ul>NSP-1 First Look Program
United States Department of Agriculture <ul><li>This website is the United States Department of Agriculture. Always make sure the property is foreclosed or abandoned. Contact the person on the listing to make sure it qualifies under NSP. </li></ul><ul><li>http:// www.resales.usda.gov/sfhdirect/sfh_prop_main.cfm </li></ul>NSP-1 First Look Program
Miscellaneous Websites <ul><li>http:// www.reoworld.com/listedproperties_state.asp </li></ul><ul><li>http:// www.precisionamc.com/properties.apx </li></ul><ul><li>https:// www.nreob.com/Public/Search/Search.ax </li></ul><ul><li>The link below is shared by Katie Miller at the Housing Authority of Bowling Green. It is nearly a one-stop shop, with 63 links to major lenders selling foreclosed properties. </li></ul><ul><li>http://www.thehardmoneypros.com/REO_bank_owned_property_directory.shtm </li></ul>NSP-1 First Look Program
Chase Mortgage <ul><li>This website is for Chase Mortgage: </li></ul><ul><li> http:// mortgage.chase.com/pages/other/co_properties_results.jsp </li></ul>NSP-1 First Look Program
NSP-1 First Look Program <ul><li>Remember: To purchase an NSP-financed home you must: </li></ul><ul><li>Always send a URA notice / voluntary acquisition form. We recommend this always be sent certified mail, return receipt requested so that you can document it was provided (whether you receive a signed acknwledgment of receipt or not). </li></ul><ul><li>Complete the Environmental Review Checklist </li></ul><ul><li>Have an appraisal dated within 60 days of the final offer to purchase. </li></ul><ul><li>Get a discount of at least 1% from the appraised value. (We would like to see the 5-10% that you agreed to in your application though.) </li></ul><ul><li>Complete a set-up packet and e-mail to DLG. </li></ul>
NSP-1 First Look Program Other reminders and helpful hints about potential homeowners: 1.You can finance up to 50% of the mortgage as an amortizing, low-interest loan or a forgivable, incrementally deferred, zero percent loan. 2. If the household includes a member with physical or mental disabilities, or the head or co-head of household is active or retired military, or someone who is homeless, then you can finance up to 100% of the home. 3. Any victim of domestic violence, by definition, qualifies as homeless.
Thank You <ul><li>If you would like us to send you a copy of the presentation please email Sara Osborne at [email_address] or Roy Brothers at [email_address] </li></ul>NSP-1 First Look Program