President George W. Bush appointed Sheila Bair as chairman of the Federal Deposit Insurance Corp. in 2006. More than 300 federally insured banks have failed during Blair’s tenure. The FDIC has announced that Bair will leave in July.
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Habersham Bank’s failure last week will cost the Deposit Insurance Fund around $90 million. Another $59 million in losses are projected from the collapse of Citizens Bank of Effingham, while Charter Oak Bank’s demise is expected to generate $22 million in related losses. But the costliest failure of the latest round of closings was San Luis Trust Bank, FSB, which is expected to cost $96 million.
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The Office of the Comptroller of the Currency seized three banks and handed them over to the Federal Deposit Insurance Corp. as receiver. In addition, the Office of Thrift Supervision, Georgia’s Department of Banking and Finance and the Arkansas State Bank Commissioner each closed down a bank. Including banks, credit unions and mortgage companies — Mortgage Daily has tracked 200 mortgage-related operations have closed or collapsed in 2010.
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The failure of Security Savings Bank, F.S.B., last week is expected to cost the Deposit Insurance Fund $82 million. The Missouri Division of Finance’s seizure of WestBridge Bank & Trust Co. is projected to cost $19 million. But last week’s biggest toll — $407 million — came as a result of the closure of Premier Bank, also by the State of Missouri.
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London, England, United Kingdom (AHN) – To purchase a house, a Briton buying a unit for the first time would need $105,000 (70,000 pounds) savings to qualify for a mortgage. The amount is three times the average salary of British workers.
It is also $30,000 (20,000 pounds) more than the deposit required just four years ago after mortgage firms increased the required deposit to 43 percent in September, which is up from 30 percent in December 2006.
The move makes it even more difficult for first-time home buyers to acquire a house and reinforces a Bank of England warning issued last week that banks are implementing stricter rules before lending money because of fears more home owners would default on their loans as workers are laid off.
Because property prices in Britain remaining are so high and tax breaks to encourage first-time home buyers arenot sufficient to prevent another downturn in the real estate market, the International Monetary Fund warned of a double dip in the country’s property market.
The IMF pointed out a decline in property purchases after the stamp duty holiday on properties worth up to $262,500 (175,000 pounds) expired on December 2009. Former British Chancellor Alistair Darling replaced the stamp duty holiday in the March budget with a two-year exemption for first-time home buyers up to $375,000 (250,000 pounds).
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Foreclosure Real Estate Investing: How NOT To Lose Your Shirt At The Foreclosure Sale For real estate professionals, this past year has been one of the most painful in recent times — defaults are up, homeownership is down, foreclosures have soared and the poorly performing housing sector is starting to create negative ripple effects in the broader national economy. Since all projections indicate that 2008 will be equally as challenging, should property investors run for the hills, put all their money in AAA rated munis, and ride out the storm until the next boom? Absolutely not! There’s no question that 2008 will bring reduced housing demand, lower prices in some areas, and fewer loan options, yet 2008 looks strong for treasure hunters. At HMB, we’ve been seeing investors scoop up bank REO’s for 40 to 50 cents on the dollar and selling them off at nice profits. After all, people will always buy property if they can get a great deal, no matter what the market conditions. Your job is to simply find the best deals. Many great deals will most certainly come from foreclosures over the next 24 months.
If you intend to jump into foreclosure auctions, follow these tips to help insure a profitable transaction: A? Do your homework: I recently had one of my investors call me and ask me if he would be risking anything greater than his security deposit if he simply walked away from a house he purchased at auction. Because he was intimately familiar with the neighborhood, he didn’t bother to visit the property. After the auction, he learned the damage to the property was more extensive than he anticipated. In a aEoehotaE? market, price appreciation could have bailed him out but, in today’s market, he was sunk. Lesson? Never buy a property sight unseen, and make sure to get the best contractor estimates possible prior to auction day. A? Read the advertisement carefully: The devil is in the fine print. You could buy a lot of trouble if you don’t read and understand every word. Examples: Many auctioneers require a Buyer’s premium. In my area, it could be as much as 10%. If your bidding on a $120,000.00 property, that’s an additional $12,000.00 expense! Even worse, you may be required to pay interest on the prior owner’s defaulting Note from date of auction forward to the date of settlement. That’s an additional 30-45 days of interest expense (or more in some instances). Worst of all, in some cases the auction purchaser could be responsible for certain outstanding liens due at the time of sale, such as water, taxes, or even condo liens. Do you really want to be responsible for the prior owner’s $3,000.00 past due HOA bill because you didn’t read the ad? A? Be careful of flipping: Flips are still possible in this market but could be dangerous to the financial health of an unseasoned or careless investor. If you intend to flip to another investor, remember he or she will be leery of buying anywhere close to retail because of the likelihood of additional price erosion over the next few years.
Did you properly discount your bid price for this? Will the property cash flow at your proposed sales price? Many investors use the 1% Rule as the aEoegold standardaE? aE” a $100,000.00 purchase price should yield a renter at $1,000.00. If you don’t carefully account for these factors, you could get stuck in the property. If you are using short-term hard money and your credit is weak, you even run the risk of loan default because you won’t be able to refinance out of your hard money loan. A? Setting property values: In addition to recent comps, you may want to go back to 2004-05 tax assessment records to review pre-bubble pricing. Is it possible for prices to retrace back to those levels? Maybe yes, maybe no, but it doesn’t hurt to bid based upon worst-case scenarios. A? Keep your cool: Don’t get caught up in the emotion of the auction. Know your absolute high price going in. Once the bidding has exceeded that price, don’t even think about it anymore. Walk to your car and leave. There’s always another deal tomorrow. A? Get finances in order before bidding: You will be required to bring to the auction a cashier’s check for the advertised deposit amount. But you may also be asked to increase the initial deposit to 10% of total purchase price within a certain time period after the auction date.
Check with the auctioneer the day of auction. Also, get lender approval prior to the day of auction. A hard money lender can be your best friend in these situations, as an approval from a hard money source accomplishes 2 things: 1) you’ll know up-front whether you’ll be able to close on the property, thereby reducing any risk of losing your deposit; and 2) you’ll get a second, and often expert, opinion on the conservative value of the property. Even if you end up using conventional lending, the hard money approval can give you great peace of mind. A? Insurance: It is critical to get a hazard insurance policy in place the day of auction. Many times, the risk of loss is contractually passed to the successful auction bidder. If you don’t have insurance and the building burns down, you lose! A? Bankruptcy: Call the auctioneer the night before (for early a.m. auctions) or the morning of the auction to make certain the foreclosed-upon borrower has not filed a bankruptcy. A bankruptcy filing stops the foreclosure process, even if it is filed one minute before auction. Probably 90% of foreclosure auctions get cancelled this way, so you’ll waste a lot time if you don’t call beforehand. A? Default: Always remember that the re-auction of a property is almost always aEoeat the risk and expense of the defaulting bidder.aE? This means if you bid on a property and don’t follow through, you could be sued for a lot more than just your deposit. Jeffrey Shiller, Esq. MD DC VA Hard Money Lender
When you start the process of buying a home or any type of real estate, you’ll no doubt hear the term “earnest money deposit” (EMD). So what exactly is an EMD?
An EMD becomes relevant when you are ready to make an offer on a property. In most states, your Real Estate Agent prepares the offer on your behalf. The offer usually takes the form of a written contract that is submitted to the seller by way of their agent.
In addition to the offer document, sellers typically expect an EMD. An EMD is a monetary deposit submitted via check to demonstrate to the seller that you are a serious buyer. In some regions of the country, only a photocopy of the check is submitted with the offer, and the original check is delivered to the appropriate entity if the offer is accepted. Ask your Real Estate Agent to clarify how deposits are handled in your region of the country.
The check is usually made out to an independent third- party such as a Title Company, Escrow Company, Real Estate Attorney or your Real Estate Broker. Ask your Real Estate Agent to clarify who will hold the EMD.
The amount of the EMD sellers expect varies by region. The EMD amount is based on the customs and practices for a region, but is generally from 1% to 2% of the purchase price. In a competitive market place where demand exceeds the supply of homes, some buyers may offer a higher EMD than expected to impress the seller of their intent. In determining the amount of your EMD, consult your Real Estate Agent and balance the need to demonstrate your serious intent, against the good business practice of minimizing the deposit amount.
The amount of the EMD is usually applied to reduce the purchase price of the property or to cover closing costs, as you dictate. For example, if you are purchasing a $300,000 property and you give an EMD of $3000, then the remaining balance owned at closing is $297,000 (plus closing costs). Alternatively, you may direct that the EMD be applied toward the closing costs.
Once a valid contract for purchase is created, an independent third-party usually holds the EMD until the purchase is either completed or cancelled. At this point, the money belongs jointly to both the seller and the buyer.
In cases where you make an offer that is accepted but later decide to cancel the offer, the terms specified in the contract (or state law) will dictate if, and under what circumstances, the EMD is returned to you. Be aware that you could loose your deposit if you do not not comply with the terms of your contract. Your Real Estate Agent can provide you information about how EMDs are dealt with if a contract is cancelled.
Since state law varies by region and practices can differ even within the same state, be sure to consult your Real Estate agent about the rules that apply to EMDs in your region of the country. You should also be aware that the EMD is not related to any down payment that you make toward your home loan.
For those who have played in the real estate game, the term earnest money deposit may be old hat. However, for those new to buying a home, the phrase may be completely foreign.
In simple terms, an earnest money deposit is a good faith deposit – a signal that the buyer is seriously interested in a property. While this can be a negotiable amount, it is not to be confused with a down payment.
How much do you need to deposit?
The amount of money acceptable varies from purchase to purchase, and may take in a number of factors. In areas where the market is hot, or strong, the buyers with the larger earnest money deposit offer may show the seller that they are more serious than others vying for the home.
Depending on the part of the country, such as coastal cities, earnest money deposits could be as high as 5% (or more) of the sale price. In smaller communities, it could be as low as $500 to $1,000.
Monies can be in the form of a personal check, a cashier’s check, a money order or cash.
Don’t make your check payable to the seller!
If the seller accepts the offer, a real estate broker, or a lawyer, holds the earnest money in escrow. Once the sale reaches the closing stage, the monies are applied to the remaining costs.
Do your research before you write the check.
One story tells of a woman who claims she lost a $2,500 earnest money deposit when she gave it to a person claiming to be a real estate broker, with official business cards and office stationery. He was a fraud and disappeared soon after. When she contacted the police, she learned she was not his first victim. Unfortunately, her money was gone.
Once a contract for the offer has been signed and the earnest money has been accepted by the seller, the buyer then has a finite amount of time to come up with the rest of the deposit. During that time, factors such as securing financing, home inspections, or other considerations can be handled.
In some states, buyers can pay an Option Fee, allowing them to walk away from a deal for any reason at all, within a certain period – usually 5 days to 2 weeks. If the deal goes ahead, this fee is applied to the purchase.
If the deal falls through, both the buyer and the seller must instruct the escrow company in writing to cancel the transaction. The funds are then returned to the buyer, minus a small cancellation fee.
If the buyer retracts the offer without reason, or at some point fails to meet the terms of the contract, the earnest money is forfeited.
For information about Minnesota condos, go to MinnesotaLoftsAndCondos.com. There you can search all Downtown Minneapolis condos for sale, in addition to getting the latest market information for the Twin Cities area. Article Source:http://www.articlesbase.com/real-estate-articles/what-the-heck-is-an-earnest-money-deposit-1304442.html
Obtaining a mortgage after bankruptcy is quiet easier than most people think. Many don’t realize that there are plausible solutions available for it, so remember; it is not completely impossible for obtaining a mortgage after bankruptcy. There are some aspects which are taken into account during the mortgage application process and this will scrutinize your guaranteed income and the amount of money you have as a deposit. Success of the application process depends on the ability to provide this information correctly.
Timely Payment:
It is a known fact that many lenders will not lend to you for a period of at least two years from the time of the bankruptcy discharge. After the initial two years, obtaining a mortgage will be much easier. To ensure the correct flow of things, you have to manage all your debts from the time of your bankruptcy discharge. Make sure you have a near- to perfect repayment history since the bankruptcy discharge. This means that you must make sure that the debts on your other assets are repaid; those which were not discharged in the bankruptcy.
Deposit:
The chance of getting a mortgage after bankruptcy can be further speeded- up by showing the amount of deposit which you have on your home. An amount as little as 3-5% deposit would be enough to get your application approved.
Limit the Debts:
You should limit your amount of debts and avoid certain thing such as credit card or bank loans, to create a more credible profile and have greater chances of obtaining a mortgage after bankruptcy. Limit your debts as much as possible, to build a credible debt-to-income ratio, so as to clear the evaluation by the mortgage providers.
Credit Report Check:
Many presume that the information on their credit report is automatically correct. It may contain errors and it should be checked for its accuracy. Requesting for a free copy of your credit report through a credit monitoring agency and credit rating agencies, can help you get a clear picture of your credit rating.
Every inaccurate piece of information on your credit report can work against you. Make sure you report any errors in your credit report to the concerned agency, as quickly as possible. This helps speed up the correction within the report and will also help you achieve a favorable debt-income ratio.
Pre approval Process:
This is the best way to determine if you can obtain a mortgage after bankruptcy. It is called a pre- approval process which is fast and simple; with no obligation and no cost involved. After this process, you will know your exact position on your mortgage after bankruptcy.
If you want beautiful homes with the best deals, then definitely visit Real Estate Property in Borrego Springs and Borrego Springs Real Estate in CA Article Source:http://www.articlesbase.com/real-estate-articles/obtaining-a-mortgage-after-bankruptcy-1300637.html
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