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Book Release: Buying a Home Again

Hot off the press! I wrote my latest Guide Book for people who have had a short sale or foreclosure and are considering buying their next home. The media has coined these home buyers as “boomerang buyers” because many are returning to buy a home again.

If you know someone who has had a short sale or foreclosure in Washington state and who is considering buying a home again, I hope you’ll share this book with them.

Check out my other guide books at the Mortgage Porter Library.

If you have had a short sale, foreclosure or a loan modification and are considering buying your next home located anywhere in Washington state, I’m happy to help you with your next mortgage.

Bankruptcy and Your Home

I have been in the mortgage side of the real estate industry for over seven years…and there’s just been a handful of times that I’ve advise someone to consider talking to a professional about bankruptcy.   It’s a very heavy subject and not easy to suggest to anyone.  Lately the topic is coming up more often.   I just stumbled across this article from the Wall Street Journal and thought it would be worthy to share:

"Most consumers filing for bankruptcy continue to do so under Chapter 7 of the federal Bankruptcy Code. Under that provision, a person must forfeit certain assets — including, in some cases, a portion of home equity. Those assets are sold to pay off debts.

While Chapter 7 filings stop foreclosure proceedings, the break is usually only temporary. As a practical matter, many homeowners who file under Chapter 7 lose their homes.

In recent months, however, an increasing number of homeowners have filed for bankruptcy under Chapter 13, which staves off foreclosure proceedings while the homeowner works out a plan to pay off mortgage debt and other obligations over time — usually three to five years. To qualify, debtors must have a regular income and must stay current on their new bills. About four in 10 filers today are filing under Chapter 13 — up from three in 10 two years ago. The 2005 change in bankruptcy laws was designed in part to shift more filers to Chapter 13, which forgives less debt than Chapter 7….Consumer advocates say the homeowners who are most likely to benefit from Chapter 13 are those facing foreclosure because of a temporary financial setback, but who expect to be able to cover their mortgage payments in the future."

If there are extenuating circumstances that caused the bankruptcy, Fannie Mae and Freddie Mac may allow transactions 24 months after the discharge as long as the borrower has reestablished their credit during that time.   FHA may allow transactions while someone is in a Chapter 13 as long as they are current on the repayment and the Trustee approves the transaction.   Late payments following a bankruptcy is not only damaging to your credit scores, it also pretty much eliminates the chance of having an "a paper" mortgage anytime soon.

Even if you have just a sniffle of financial distress, seek professional advise now.  Bankruptcy is not something to enter into causally, you will need to consult with an attorney who specializes in bankruptcy. 

If you have a mortgage that’s adjusting within the next 12 months, or you don’t know the terms of your mortgage, please contact your Mortgage Professional.