(Money market news) Help From Fannie and Freddie Programs for Foreclosed Homes

November 2nd, 2009 admin Posted in finance |

By JD Evans A

Home buyers are not accustomed to getting much aide with their home loan financing. In fact, they are generally happy just to get a California mortgage. At least one group of borrowers, though, were offered some relief. Fannie Mae and Freddie Mac, the government-controlled companies that buy mortgages in bulk from lenders, have offered financing incentives for buyers of defaulted homes that Fannie and Freddie own in California and across the USA. Home buyers had until Oct. 30 to apply to take advantage of Freddie Mac’s SmartBuy program, which began in July and offered up to 3.5 percent of a home’s sale price for closing costs.

Freddie Mac’s program, was created on July 17, 2009. The program was designed by Freddie Mac in an attempt to aide families buying a home with their closing cost expenses. Under the program, the mortgage giant offers to pay as much as 3.5 percent or the entire closing costs, whichever is lower for owner-occupied homes. Owner occupied cash sale homes can receive up to 1 percent for closing costs through the SmartBuy program. Investors, however, are not eligible for this program. To qualify for the mortgage relief program, the home must be a primary residence and must be processed through the foreclosed property section of Freddie Mac’s HomeSteps Web site. Also, loans must close by year’s end. As an added bonus, the HomeSteps properties also include two-year warranties on major appliances and electrical, plumbing, air-conditioning and heating systems. HomeSteps is the real estate sales unit of Freddie Mac and is focussed on selling homes that Freddie Mac owns. The program also includes a comprehensive two-year home warranty on HomeSteps properties. Although the closing cost offer has already expired, the warranty is ongoing.

The incentives for buyers in Fannie Mae’s ongoing program were even more aggressive than those offered by Freddie Mac. Through participating lenders, Fannie offered mortgages to buyers offering a down payment of 3 percent, and these buyers did not have to secure private mortgage insurance. Fannie Mae also offered closing cost assistance to buyers, as long as they negotiate for it. But, unlike Freddie Mac’s, there was no cap to the assistance level. Under the program, the average homeowner has received payments equivalent to 3.75 percent of the home loan value. Until June, Fannie Mae also offered to cover any repairs to the home during the borrower’s first half year in the home, up to $3,000. Now, Fannie Mae is considering renewing or changing that program. Also, in highly impacted areas by the economic downturn that have qualified for federal financing through the National Stabilization Program, Fannie Mae is considering a 15% discount on those properties. The majority of Fannie Mae’s foreclosure incentives are for buyers who will use the home as their primary residence, or so-called public entities like Neighborhood Housing Services and other organizations that update properties and sell them to owner-occupants.

The HomeSteps program is viewed by some industry observers as an effective partnership between Freddie Mac and local real estate agents to unload all of these properties. The program is essentially for people who have no qualms about purchasing a repossessed home. The good news is that these homes are usually in move-in condition. HomeSteps has about 20,000 properties across the country, with about 40 percent of this total in California. The HomeSteps-Smart Buy and Fannie Mae programs are considered to be a win/win for both Freddie Mac and assisted home buyers. The programs help home buyers purchase homes with some financial assistance; and at the same time it helps Fannie and Freddie sell off some of its repossessed properties. However, the program has had it’s failures and the large mortgage fund providers are looking for more deals before the financial assistance expires.

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Getting Customers for Your Home Business

By Craig Garrett

What are best avenues to bring customers to you and increase your visibility? In this article, we will look at some methods that business owners have used for many years and have been very successful at increasing their customers and generating more revenue for their business.

A very effective way to generate business, thus increasing your profits, is to talk to people you know; friends, families, neighbours, hit the pavement, spread the word to everyone you know, especially those who like your business and the products you have to offer. Be creative; if for example one of your products is balloons consider going to all the restaurants in your area and make a deal to have your balloons given to the children who enter. When you visit businesses or friends take a few samples of your products to show them, leave your products with them so they can look at them while you are gone and then follow-up with them and find out what they think. Make them feel a part of your business.

Networking is a great way to make business contacts and you can do this almost anywhere that you go. Your local chamber of commerce often has networking functions where you can meet other business owners in your area. You can talk to them about their business and what works for them, exchange business cards. This is a great method for making contacts. After the social function make a point to go and visit their business,it is important to develop a relationship with them.

Take a walk around your neighbourhood. This is a great way to meet new people in a casual environment and allows you to sell your product without really selling it. You will have an opportunity to find out what customers who are near you like. Will your product appeal to them? Should you tweak your products to match the potential customers that are near your area? Go into that coffee house that you may not frequent and spend sometime talking with the other customers. This gives you a good feel of the potential market near you.

If you do not have a web page yet, then it is high time to utilise this tool for marketing your business and the products you offer. If you are not comfortable creating your own page there are many professionals that can do this for you and you can use this as an opportunity to promote your business as well. As they get to know your product while they are creating a web page for you, they can also refer others to your site. Remember, when creating a web-page you want to provide the potential customers with information and keywords that are specific to your company.

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