The Demands of Rent Increase, and So Does the Price

The new wave is renting, and that is because of the level of foreclosures. I am sad to say that it seems our housing market is working opposite of what it should be. The sad part? Those who were unable to stay in their homes are now going to be paying someone else’s mortgage rather than their own, and they aren’t going to be saving a heck of a whole lot. The demand on renting is going up and therefore the affordability of renting is going down. 

Why Rent is Going Up 

Rent is going up for complexes and for those who are renting out houses, simply because they know they can increase the prices and many are seeking shelter now that they can no longer stay with their relatives. Houses are getting cramped with family members taking people in, and as modifications don’t get approved. Families have been planning to look for apartments as they see their foreclosure under way, meaning they had to go and start looking quickly, so they could get everything moved out. Renting will be more expensive than in the past, but with so many foreclosures being lined up families just don’t have a choice.

Save Money or Sell the House?

Retirement age means that you want to have money to use for now and in the future, so if you do have enough equity in your home to get a reasonable amount of money out of it, why not? If you don’t, you can continue to save money, and live as debt free as possible. Otherwise, if you have more house than you really need you can sell it and take that money and put it in the bank. The popular school of thought used to be that when you had extra cash to go invest it in stocks, bonds or an IRA, but with a volatile stock market that probably isn’t wise. I can’t predict it or steer you one way or the other, but I will tell you that you have to keep up with because it changes daily.


Knowing whether or not to sell can also be tough, only because values everywhere are being affected. Some states were hit harder than others, and I can see where many who are older in age would be reluctant to sell if they aren’t sure how much they can get out of it. Using retirement income like pensions and social security is hard on those who are of age too, because they aren’t getting as much as they used to make, and with costly prescriptions to pay for many seniors feel overwhelmed in this economy.

Other Ways to Make Your Home Work for You

There may be other options to making your home work for you if you don’t wish to sell, and that could be through making the home more energy efficient. More energy efficient homes can help save you hundreds if not thousands on your energy bills, which can really help during this time of economic crisis. Improvements to the home don’t hurt, so long as you are keeping the cost within your budget. Those who could buy you home in the future may really be looking for what you have, but you don’t want your improvements to cost you more in the long run. So, as always be wise and consider your budget first before you make any hasty decisions.

Mayer Dallal

Refinancing Before the Holidays

If you have a lot of debt now and you want to get things in order, then go ahead and consolidate. The challenge in the past has been that families would refinance to pay off debt, then turn around and run up their credit cards again rather than paying cash. This is absurd, and yes it doesn’t benefit you if you know that your spending habits are hard to curtail. However, at a time like this in a rough economy it is best to downsize and begin setting aside more money in case you do have an emergency. Working off a cash basis will help you stop using these credit cards, and will get you to a place where you can break away from the spending and really think about what you are doing. If you don’t have the money on hand, don’t use a credit card to get it. While refinancing your home to consolidate and pay off debt is helpful, keep in mind that the less you have to consolidate the better off you are. You want to build equity in your home, and in a market where housing prices have fallen it doesn’t help to use it all up. If you have to do it then do it, but if you can pay off some other things on your own then do it that way.


I am here to help you every step of the way, and I will also be honest and tell you that refinancing may not be the answer for you. Not everyone will be in a position to refinance, but refinancing through FHA will give you the lowest rates on the market today, and FHA guidelines focus on commonsense underwriting, so they look at the bigger picture. FHA will look at your income, credit, investments, cash reserves, and how you pay other bills outside of your mortgage.

For more information you can go to www.fhaloansnow.net, or you can call me directly at 310-498-2700.

-Mayer Dallal

A New Credit Score?

There is a new credit score available to you and it’s custom made just for your mortgage. That is right! The new FICO 8 is on the horizon, and it only pertains to how you pay your mortgage loan.


FICO is the leader is credit management technology, and services hundreds of thousands of companies. The three main credit agencies use it, and it’s available to anyone. What does this do? The reason for this is to allow banks to get a view that is geared to the real estate market, and will enable us to get some stability as a country in our markets. Overall, this is very beneficial and will reduce the risk for everyone.

The idea behind the score was also to help lenders predict how a mortgage would perform, and to help them fine tune their credit decisions based on what they can see, which will give them a good idea of what they think will happen. All lenders and services will have access to it, so there should be no surprises.

-Mayer Dallal

Poor Credit, Poor Richard

To get rid of poor credit, you need to make one small investment that brings great rewards. Get copies of your credit report from all three major credit reporting bureaus. This will help you to look at the bigger picture so that you can see what you have open, what needs to be paid, cancelled or even completely removed. You can assess the oldest ones first, making any collection companies are contacted and your options have been reviewed. It's best to contact them and make arrangements, than it is to completely ignore them. Explain your situation, and don't back down. When they demand money, tell them the truth and see if you can come up with a viable settlement offer. It's best to pay something than not to pay it at all. It is also wiser to get it settled than to have it go on your credit for ten years unpaid or ending up as a judgment against you.


If there is a judgment, attempt to pay that first. These are typically only going to be accepted as a paid in full arrangement, but you can certainly try. It usually depends on what they are. Try to make payment arrangements on the smallest debts first, because you can really backfire on your plan when you promise too much too soon. Again be honest; you already have poor credit, so don't stress yourself out when things aren't going to change before tomorrow. Pace yourself, focusing on one account at a time.



For more information on how to repair credit, you can go to www.fhaloansnow.net.

-Mayer Dallal

The Best FHA Mortgages

People always ask me what the best FHA mortgages are. Truthfully, FHA in my mind is the best way to go no matter what. FHA is the Federal Housing Administration, and they insure the loan for the lender if you default on your mortgage. FHA offers the best programs and rates around, along with alternatives for the buyer or the current homeowner.




The best FHA mortgages are the 30 year fixed option, that way you know your monthly payment is always the same. In addition, you will be escrowing your taxes and insurance so that you don’t have to come up with that money all at once, which is smart. I don’t know of too many folks that can come up with that kind of money in one lump sum. It just isn’t that simple, and if you think you can save up the money, you will usually end up using it for something else. I have seen it happen so many times.



FHA also offers one of the best loans yet, which is the Energy Efficient Mortgage, or the EEM. This is no doubt one of the best FHA mortgages, because it gives homeowners the opportunity to finance the amount of home improvements into the home, and it can be worked into the loan for a home buyer as well, with no additional qualifications needed. FHA uses the amount of savings that you would get from your energy saving improvements to alleviate the burden of a higher payment. This is a commonsense approach to underwriting that you won’t find with a conventional loan.



For more information on the best FHA mortgages, you can visit my website at www.fhaloansnow.net, or call me at 310-498-2700.



-Mayer Dallal

FHA Keys to Success

FHA keys to success include some things that I believe are important, so I just wanted to share my thoughts on this. These things just make good sense, but these things will not just bring you success with FHA, but they will provide you success in your everyday life.




Saving money is a big one. If you don’t start today, you never will. We find all kinds of reasons why we don’t believe we need to hurry up and save. We blame the banks and we blame others for our problems, but you should pay yourself first so this is for sure a part of the FHA keys to success in my book. This will not just provide you with an emergency fund, but it will help you work toward your down payment needed for an FHA loan.



Getting copies of your credit reports from all three bureaus is also one of the FHA keys to success. Knowing what is on your credit, and whether or not it’s accurate is critical otherwise you can’t change it. Get to the heart of the matter, and make sure that anything that is outstanding is paid off, and don’t waste time. Your credit is everything, so take care of it.



Taking the time to correct errors on the credit report is also a major step to FHA keys to success. If you see an error, don’t let it go and try to keep documentation of when payments were made because this is extremely helpful when proving that a late payment didn’t exist. Checking your FICO score can be helpful too, so be sure to tap into all the resources you can.



For more information and my tips on having success with FHA and other areas of your finances, go to www.fhaloansnow.net. I am just an email or a phone call away!



-Mayer Dallal

Does a Short Sale Show up On Credit?

Because I am a Certified Distressed Property Expert, I have families ask me all the time as to whether a short sale will show on credit. The answer is no, but let me go into a little more detail.




Short sales are not something that are reported, and that is because they are arranged differently by the bank. The short sale is actually “debt forgiveness”, in the lender’s eyes, therefore the short sale will not show on credit. So, the term “short sale”, will not be on your credit report. However, keep in mind that you’re not completely out of the woods. Your mortgage will certainly show any late pays that you have, and it should appear that your mortgage is paid as agreed, or is settled. So, again, “short sale”, will not appear on the credit report.



The short sale not appearing on credit, will also not affect your credit score as deeply as doing a foreclosure. Having slow pay, and a mortgage showing as “settled”, will only drop your scores about 50 points, whereas a foreclosure will drop your score from 250 to 300 points. In addition, when filling out a mortgage application, or 1003, there isn’t a place to mark that you have had a short sale. However, the application does have a spot for you to indicate that you have had a foreclosure.



Although we face tough economic times, a short sale is not the end of the world, but a short sale won’t be on credit either. When you think about the end result of doing one, think of your family first to help steer you in the best direction.

-Mayer Dallal

FHA and the Electricity Guidelines for your Home!

If you have ever done an FHA loan, you know that FHA has very specific things they are looking for when checking out the electricity. FHA and electricity do work together….well maybe they do and maybe they don’t. What does your inspector say?




The last thing you want to worry about when you buy your home, is whether or not your electricity is working properly. In order to make sure that you aren’t in a complete lemon, FHA electricity guidelines state that a single main shut-off breaker should exist. If more than one breaker has to be tripped to disconnected power, then the service panel must be replaced.



FHA electricity guidelines were put into place to help you get the most from your new home. The inspector is there to see if there are any problems, not to work against you. However, if you feel like there is a challenge, you need to bring it up right then and there. There is nothing wrong with asking questions, and it’s essential to making sure that you get what you need from your new home.



For more information on this and other FHA guidelines, please visit my website at www.fhaloansnow.net.

-Mayer Dallal

Is Escrow Mandatory with FHA?

If your property were to be destroyed, the lender would lose its collateral, but keep in mind that this is why you need homeowner’s insurance. Insurance is a way of having protection “just in case”, you run into a problem. Taxes are mandatory, and escrow is helpful to set this up so that you don’t have to think about it. FHA escrow is required, but keep in mind that there are benefits for all involved.




When your taxes go unpaid, the state can foreclose on your home in order to obtain payment. This is not a pleasant thought right? Insurance is absolutely necessary, but keep in mind that no lender will let you close on a home without homeowner’s insurance, so you really can’t get around it. You can see why FHA’s mandatory escrow makes sense. The FHA escrow wants to be absolutely that it sets aside enough to cover your taxes and insurance for at least one year, and a little more in case your taxes and insurance go up. We all know that two things are certain and that’s taxes and death.



The FHA escrow will also reward you in the end when you pay the home off. Whatever you have in your FHA escrow will be refunded to you, do don’t sweat it. This is normal, and again it’s to make sure that in case your premiums go up that they have enough to cover everything.



For more information on FHA escrow regulations and requirements, you can visit my website at www.fhaloansnow.net.

-Mayer Dallal

FHA Energy Efficient Home Loans

Not many people are aware of the financing available for FHA energy efficient financing. While it is not common in many areas, there are families that will opt for it. Part of the battle is just having a professional that will make you aware of all of your options.




FHA’s energy efficient financing can be worked into the loan whether it’s a purchase or a refinance. The key here is determine to what extent you need the work done. The FHA energy efficient financing can be used in conjunction with the 203b program. This program is what allows you to get repairs done on the home when you purchase, or get them done during a refinance. Even with a purchase, it is worked into the loan, and if it isn’t and your improvements are minimal, then at some point you can do a Title I HUD loan.



Title I HUD loans can only be done by a bank that is approved to do them, and they are usually smaller loan amounts of $5-$8,000. These can be done at anytime, and are a good idea for those who might end up with some expenditures they weren’t expecting.



I know families that have used FHA Energy Efficient financing in the past for solar panels, energy efficient appliances and more. You might want to check it out if you are looking at buying a home that needs a little work.

For more information on FHA guidelines and products, you can visit my website at: www.fhaloansnow.net.



-Mayer Dallal

FHA Eligibility Requirements are Important

FHA eligibility requirements are important for you to know. I hear clients talk about wanting to go FHA because they have had credit problems, but don’t be so quick to jump on the FHA bandwagon if your credit is bad.




It’s a misnomer that FHA loans are for those with bad credit, but they aren’t. FHA is an option that engages in what we call commonsense underwriting. FHA eligibility requirements don’t allow for credit that is in the trash heap, but they won’t really hold the past against you either.



FHA eligibility requirements are going to hold your credit score as somewhat important. FHA is looking for a score of at least 620 for you to do a purchase with just 3.5% down, but keep in mind that although they say yes, the lender may still say no.



FHA eligibility requirements are not the end of the road, for many lenders they are just the beginning. While many lenders encourage you to go FHA, they play by their rules, and with all of the defaults they aren’t so quick to have you sign the papers just because you can.



For more information on FHA eligibility requirements, go to http://www.fhaloansnow.net/ .

-Mayer Dallal

Loving the FHA Calculator

I love the FHA calculator because it’s such a useful tool to help people know where they stand. People are going out trying to find ways to spend money they don’t have, and they shouldn’t. The use of the FHA calculator keeps it simple, and puts everything in perspective before you get carried away.




It is never too early to figure out how much you can afford, and the best part is it’s so easy to do with the FHA calculator. This is why I have them on my website, and encourage everyone to use them. You can plug in the loan amount, so if you have a particular house in mind then go with that. This way, you will know if what you are looking at is in your range. In addition, you can just plug in the interest rate and term, and it will give you the monthly payment with principal and interest, and with taxes and insurance.



The FHA calculator gives you real expectations on what you can afford, and that way when you search for a house, you will know what is in your budget and what isn’t. It’s all a matter of knowing what you can pay for, and if you don’t have any idea than you are in for a rude awakening. Go to your loan officer with confidence and knowledge that you have an understanding of what you can spend. For more information, or to view my FHA calculator on my website, you can go to www.fhaloansnow.net.

-Mayer Dallal

Is An FHA Short Term Loan Beneficial?

The FHA bridge loan is not something that you hear a lot about, but that is because when it first came out it wasn’t being talked about by FHA. FHA wanted to keep this one under their hat until the bridge loan was perfected, and the plan they came up with is fine, but is it really a good idea?



I think it depends on the person or family. As with anything in life, it’s all about being responsible, and for those who are irresponsible and don’t save, it may be a bad idea. The short term bridge loan with FHA was designed for those who didn’t have the down payment money for their new purchase. Then, once filing with the IRS, you would know what you are getting back, but it won’t go against your tax credit. So, making sure that you will have the money later is a key factor. Generally speaking, if someone is pretty responsible then changes are they will have the funds to use for a down payment on the home, but if not then the short term bridge loan can be effective.



As with anything, educate yourself and don’t do it just because someone else did or suggested it. When you hear about the FHA short term bridge loan, do some research and look it up for yourself, but what you really need is an expert. For more information, go to www.fhaloansnow.net, and talk to your FHA expert today.



-Mayer Dallal

FHA and Bankruptcy

Having a good credit rating can affect your ability to borrow money, even when it comes to FHA. FHA has a stigma attached to it that sounds as though anyone can qualify. This isn’t true, and in fact they are looking at your credit closely, but their method is a little different.



FHA uses what is called “commonsense underwriting”, so they won’t hold your past against you completely. FHA bankruptcy rules are stringent, meaning you can’t have a bankruptcy on credit within the past two years. FHA bankruptcy guidelines state that if you have been in a chapter 13 for one year and have made on time payments then they will consider giving you a loan.



When deciding that you want to buy a home or refinance, you need an FHA expert to guide you through the process. I am an expert, and I can help. You can learn more by going to my website, www.fhaloansnow.net.



-Mayer Dallal

Sometimes

Sometimes I wonder how we got into this mess we are in as a country. I guess in some ways I understand it, and then sometimes I don’t. We are all guilty.




I think back to a few years ago, rather 2006 when this all happened. Why? Could it have been prevented? Yes, it could have been prevented, but we just tried to turn a blind eye to it. We think everything is okay, but it isn’t. We spend, and we don’t consider what could happen. We buy without really thinking about it. Worst of all, when we outspent ourselves, we decided to just keep on spending. A lot of us think that way.



Eating at home with our family is no longer an option; we are always just running around doing whatever we want. Why are we like this? We just have to have what we want, when we want it. There is no more anticipation, no more surprise, it’s just all for the moment.



Don’t think for a second that I have a day of complete rest in my mind. I have people come to me every day that don’t get approved. I also have people come to me that I can get approved, but it is never that simple. My mom always told me that, “If it sounds too good to be true, then it probably isn’t true.”



Today, I just want you to think about what happens; “sometimes”.



-Mayer Dallal

FHA Requirements

FHA is a great loan for anyone, whether they are buying or refinancing. FHA does have requirements though, and I actually wrote about those today in my article.




It’s just simple stuff, and it’s easy to understand. The great thing about buying with an FHA loan is they only require 3.5% down! A conventional loan is going to require a down payment of anywhere from 5% to 30%, and not a lot of families have that kind of money just lying around.



The other great thing about the FHA requirements is they don’t expect you to be perfect. While they don’t want to see a current bankruptcy or large amounts of delinquent debt, they are more lenient on old derogatory credit. So, don’t let another slow pay sneak up on you if you have had them in the past. Just be sure that you have made notes on why you had them, and we can move on.



FHA requirements aren’t hard, but it’s just commonsense. This is what makes doing an FHA loan so great. I do them every day, and I get to help families do things that otherwise they couldn’t do because they weren’t working with the right professional.



Knowing FHA requirements means that you need someone who knows the industry thoroughly, and pays attention to the details. You don’t want to commit to thousands of dollars and have everything mishandled. This is your money, your life and your family.



FHA requirements take a professional like me to help you. This is important. For more information, visit my website at www.fhaloansnow.net, or email me at mdallal@fhaloansnow.net.

-Mayer Dallal

FHA vs. Conventional

FHA is now on the rise with more families looking into buying a home. With the housing market holding at low prices and a homebuyer tax credit, it is incentive for families to want to jump into the homeownership pool. There are some differences between FHA and other conventional programs with lenders.




FHA purchases are the most common FHA loans, and their credit restrictions are a little less stringent. What does this mean to you? In reality, it means that while FHA is not a license to go out and ruin your credit rating, it does overlook some collections and past derogatory credit. However, it does look very closely at your rent history over the past 12 to 18 months, as well as your installment debt, such as your car loan. Conventional loans are very stringent, considering your history on all credit over the past two years.



The other main difference is that FHA only requires that you have at least 3.5% down, while many conventional loans require 20% down. These are the two main differences between FHA and conventional loans. Look to the experts in FHA loans, by visiting, www.fhaloansnow.net.



-Mayer Dallal

What's Up With Short Sale Fraud?

It's simply criminal that second lien holders are asking for money outside of the closing in order to make up for some of the money they aren't getting.  Second lien holders usually get a specified amount that is negotiated out of the proceeds with the first mortgage holder.  However, the second lien holder is always last on the list to get the benefits of anything.

However, it doesn't mean that they should prompt actions that are illegal.  RESPA says it's illegal and so do I. I know how hard I work for my clients, and this just outrages me to no end.  The only thing we can do is work towards a better process and hold people accountable.  I know I do!

-Mayer Dallal

There is Life After a Short Sale !

There is life after a short sale, don’t think that your financial future is over once you negotiate a short sale.


A short sale is much different from a foreclosure, in that it is a negotiation with the lender to let the home sell for less than is owed on the home. The short sale prevents you from having a foreclosure on your credit, and it will also allow you to credit qualify for another loan within a few years time. Foreclosure will affect your credit rating for three years, but it will remain on your credit report for ten years. When doing a short sale, your credit will show that your mortgage loan is paid as agreed, or settled, but this will probably drop your score no more than 50 points, and the slow pay will drop off your report within 12 to 18 months.



With all of the media hype on short sales, it’s really tough to know what is right and what is wrong. You need an expert and the tools and resources to get this right. Foreclosure can be devastating so don’t let it happen to you. There are options, so we can discover what those are together. Call me at (310) 498-2700, or you can email me today at mdallal@fhaloansnow.net.