In addition to residential sales, my team is heavily involved in helping investors profit by investing in foreclosure properties. Mainly by purchasing small single family homes in Atlanta foreclosure market at 60% to 70% of future value, rehabbing them, and quickly reselling them for a healthy profit. Most of these properties are in blue collar neighborhoods that we resell to first time buyers using FHA insured financing. Most of the foreclosed properties we purchase were also financed by FHA insured mortgages.
The one wrinkle in this buy, rehab, and resell process was the arcane Housing and Urban Development anti-flipping 90 day rule 24CCFR 203.37a(b)(2). This rule "provide that a rehabbed property would not be eligible for another FHA insured loan if the contract of sale was executed within 90 days of the prior acquisition by the seller and the seller was not exempt from this rule". What this meant in plain non-bureaucrat English was that if an investor purchased the...
FHA announced this week it will seek to implement changes to current
policies. These changes are all restrictive and have a significant
impact on the real estate buying public.
You can read all about the changes here: FHA Announces Policy Changes to Address Risk and Strengthen Finances
For those less inclined to sift through all the beauracracy ... here's a quick snapshot:
- The upfront mortgage insurance premium will increase by 0.5% from 1.75% to 2.25%
- The maximum seller concessions will decrease from 6% of the sales price to 3% of the sales price
- There are some credit score/LTV limitations that should not affect “A” paper lenders
When Do The Changes Go Into Effect?
FHA will issue a notice and have a comment period on...
2009 was a record setting year in Metro Atlanta with 117,107 published foreclosure notices.
And the 2010 outlook doesn't look promising as the economy and job market continues to show signs of weakness.
But with just 8,181 foreclosure notices filed in Janaury 2010 we're able to breathe a small sigh of relief. Surprisingly, we saw the first January-to-January decline in 10 years. So what is the can this decline be attributed to? Likely a combination of several factors, not the least of which being that we are finally seeing fall out from the "subprime" crisis getting cleaned up.
But it's far too early to predict how the year will go from here. With many banks slowing the pace of foreclosure through the Holiday season -- it's possible this is just a seasonal dip and the relentless pace of 2009 will continue as we head into the spring in summer season.
So how did the 8,000+ foreclosure notices fall county-to-county? Fulton County...