Hello Elite,

As promised, I will continue to provide my fellow Real Estate Professionals with valuable industry related education and information.

I want you to rely on me not only as your Fidelity National Home Warranty and Disclosure Source NHD representative, but as a source for Real Estate industry news and information.

Yvonne Nelson                                                                                        

Assistant Vice President

Fidelity National Home Warranty & Disclosure Source

800-308-1424 ext 3518

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REO Disclosures: Who Discloses What?

Author: Chuck Piro, VP Disclosure Source

Okay……..so you’re ready to submit an offer on a REO property, but you’re really unsure of what disclosures you can expect from the bank.  In fact, the asset manager has confirmed that the property is being sold "as is".  So, does "as is" mean no disclosures for your buyer to review?  Not necessarily!

When representing a buyer on a bank-owned property, Realtors need to recognize what disclosures the buyer is entitled to receive from the bank.  Yet, this is an area that seems to be confusing to, not only Realtors, but the REO lenders themselves.   

As you know, owners of bank-owned properties are not legally obligated to provide you with the same disclosures that you would demand from a traditional seller.  But that certainly doesn’t mean that the bank is exempt from providing prospective buyers disclosures regarding potential hazards that may affect the property. 

In fact, the REO lender is required to disclose certain conditions that may affect the value or desirability of the property.  Even though they may be exempt from many obligations, they must still comply with many others.  So, even though the property is being sold "as is"; you need to know what to expect in terms of disclosure for your buyer. 

To help clarify the matter of disclosures on REO property, The California Association of Realtors has made available the REO Advisory (C.A.R. Form REO 4/08) that goes along with an offer on a bank-owned property.  This form clearly defines disclosure Exemptions and Requirements that pertain to REO property transactions.

Obviously, the bank never lived in the house, so they are exempt from providing the Transfer Disclosure Statement. Additionally, REO lenders are exempt from disclosing Mello-Roos and 1915 Bond Act Assessments, as well as Private Transfer Taxes.  And, they are not obligated to provide you and your buyer with the Residential Environmental Hazards Booklet.   

Included on the list of EXEMPTIONS is the Natural Hazards Disclosure Statement (NHDS), but…….REO lenders are "…not exempt from applicable statutory obligations to disclose earthquake fault zones, seismic hazard zones, state responsibility areas, very high fire hazard severity zones, special flood hazard areas and flood hazard zones…"  Of course, this information is typically included in disclosure reports obtainable from third-party disclosure companies.

But, keep this is mind….whether the bank discloses or not, Realtors should take a moral approach to real estate disclosure.  Obviously you want to avoid lawsuits and reduce liability.  However, reduced liability is a marginal benefit of disclosure; it shouldn’t be the primary motive.  The best reason…….it’s just the right thing to do!  Instead of focusing on liability, you ought to be supporting the best interests of your client.  Who is the beneficiary of a disclosure report?  It’s your buyer!  Realtors, who pursue that approach rather than the legalistic one, enjoy rewards.  Not only do they build solid reputations for honest, ethical business practice, but they receive repeat business and referrals created by a sound reputation.   Weather the bank is or not…..you should be practical about disclosure.  Remember, you’re in the service business.  Treat your clients the same way you’d like to be treated.  If you approach your dealings from this prospective, you will surely succeed in building a solid business with referral clients and repeat customers for years to come.

A BETTER GREEN HOME INSPECTION COMPANY 

Our company has partnered with a State Licensed Termite Inspection Company for you convenience.

(Buyers, Sellers and Agents)

Also every inspection shows you how to make your home a Greener Home. We provide over 35 pages of information on how to cut costs from Heating and Cooling to Duct Sealing and Programming of Thermostat to save money. Our reports are computer generated with summary of all issues and photos The report will be completed within 24 hours and sent to you via e-mail, mail, or fax.

In-Demand Property Inspections is a Green Premier Residential & Green Commercial Inspection Company. We offer our services for the concerned & well informed smart home buyer or sellers. We provide comprehensive, professional, and thorough inspections. We have 2 offices for your convenience; one in the Sacramento Valley and one in the SF Bay Area.

STRUCTURAL SOUNDNESS

VISIBLE ASPECTS OF INTERIOR

ELECTRICAL SYSTEM

EXTERIOR OF HOME

HEATING & COOLING SYSTEM

ROOFING, GUTTERS & FLASHING

PLUMBING SYSTEMS

GROUNDS & OUTBUILDINGS

IN-DEMAND PROPERTY INSPECTIONS CONTACT INFO.

DIRECT(415)760-6040 SEVAN TELLEZ

DIRECT(916)870-4588 ALFREDO TELLEZ III

DIRECT(916)662-1924 ALFREDO TELLEZ JR. HABLA ESPANOL

NAR Opposes Full Privatization of Fannie Mae and Freddie Mac and Adopts Secondary Mortgage Market Principles

 During its annual convention in Orlando , NAR adopted principles recommending continued federal government involvement in the secondary mortgage market. In light of disruptions in the credit markets and the conservatorship of Fannie Mae and Freddie Mac, NAR developed the principles for consideration of the 111th Congress and the Obama Administration.

The goal of the principles is to ensure there is sufficient capital to support mortgage lending to qualified borrowers in all market conditions and in all markets throughout the country.

 
Housing Markets Ready to Rebound?

While the national news still continues to focus on the challenges in the national housing market, many local markets are poised to rebound, according to SmartMoney Magazine. The editors researched all of the major metro areas in the US to find markets that aare primed to see home values increase. Some of these areas include, Seattle , WA , Des Monies, IA, Raliegh , NC , Philadelphia , PA , Birmingham , AL , and Denver , CO . To learn more visit www.SmartMoney.com/mag.   

 
Also - there’s an interesting tax credit for first time homebuyers available through mid-2009:

http://www.realtor.org/gapublic.nsf/files/hbtaxcreditqa2008.pdf/$FILE/hbtaxcreditqa2008.pdf 

Mortgage Market Update

After weeks of sizeable swings in mortgage rates, last week saw rates move significantly less. Most rates drifted downward, as evidence of the economic slowing mounted.

Retail sales dropped for the fourth month in a row, plummeting by a record 2.8%. The week was also filled with announcements regarding numerous government  programs related to housing. Both the Federal Housing Finance Agency and the Federal Deposit Insurance Corporation announced programs offering bounties to mortgage servicing companies for announcement that the $700 billion dollar Troubled Asset  Relief Program would not be used to buy toxic mortgage debt off financial companies’ books.

While financial markets may continue to be rocked on a daily basis, we hope to see mortgage rates remain calmer again this week. If data from the Industrial Production numbers and both the CPI and PPI point to economic slowing with lower inflationary pressures, rates may continue downward.

 
Mortgage Rate Trend Index
NATIONAL OVERNIGHT AVERAGES

30 yr fixed mtg        6.08%    
15 yr fixed mtg        5.76%    
5/1 ARM        5.95%    

Will rates rise or remain relatively unchanged? Experts and Bankrate analysts provide their insights.

This week, more than half of the panelists believe mortgage rates will fall over the next 35 to 45 days. The rest are about equally split between those who think rates will rise and those who predict that rates will remain relatively unchanged (plus or minus 2 basis points).

A BETTER GREEN HOME INSPECTION COMPANY

This week will feature

A representative from the Real Estate Finance Forum will be present to discuss recent changes to homebuyer assistance programs, interest rates and all things real estate. Those in attendance are welcome to partake in a group discussion. This is a great opportunity to share your thoughts or concerns with fellow SAR Members and receive their input.

A BETTER GREEN HOME INSPECTION COMPANY

Our company has partnered with a State Licensed Termite Inspection Company for you convenience.

(Buyers, Sellers and Agents)

Also every inspection shows you how to make your home a Greener Home. We provide over 35 pages of information on how to cut costs from Heating and Cooling to Duct Sealing and Programming of Thermostat to save money. Our reports are computer generated with summary of all issues and photos The report will be completed within 24 hours and sent to you via e-mail, mail, or fax.

In-Demand Property Inspections is a Green Premier Residential & Green Commercial Inspection Company. We offer our services for the concerned & well informed smart home buyer or sellers. We provide comprehensive, professional, and thorough inspections. We have 2 offices for your convenience; one in the Sacramento Valley and one in the SF Bay Area.

STRUCTURAL SOUNDNESS

VISIBLE ASPECTS OF INTERIOR

ELECTRICAL SYSTEM

EXTERIOR OF HOME

HEATING & COOLING SYSTEM

ROOFING, GUTTERS & FLASHING

PLUMBING SYSTEMS

GROUNDS & OUTBUILDINGS

The above inspector has been professionally trained to perform home inspections in a licensed home inspection training programs, provided by Inspection Training Associates, the National leader in home inspection training. ASHI and CREIA endorsed.