Today in the United States there are more and more homeowners facing the devastating financial challenge of foreclosure. Andover, MA and the surrounding communities are not immune from the national housing market crisis.   While single family homes are still selling in Andover, 4.3% fewer homes have been sold this year compared to last year. Market data also shows a nearly 10% decline in the median sales price of a single family home in Andover. Sales of condominiums in Andover have been even slower.  Market reports show a 32% decline in the number of condominium units sold along with a 29% decline in the median sales price.  

 If you're facing a financial hardship or are at risk for foreclosure on your home in Andover, consider the following alternatives.

1. Reinstatement: This option is extremely simple, but the most difficult. The homeowner asks the mortgage company the total amount owed and pays it all, including fines and fees. It does not require approval, and lenders will allow this up to the day before the final foreclosure sale.
2. Forbearance or Repayment plan: This is when a homeowner negotiates repaying their back payments over a period of time. Usually, the homeowner makes their current payment as well as a portion of the back payments owed. Most lenders require homeowners to be qualified for this option.
3. Mortgage Modification: This plan is when either the interest rate of the loan, the principal balance or the term of the loan is reduced. The result is generally a lower, more affordable payment for the homeowner. Homeowners need to qualify for this option and must supply all necessary documentation, while the lender has to be actively pursuing modifications.
4. Short Sale:  Contact me your Certified Distressed Property Expert to negotiate the sale of your home. In many cases the mortgage company will allow a short sale which includes all realtor and legal fees.

For more information on ways to avoid foreclosure go to the HUD website.  To find out the current value of your home go to MyHomeValueToday.

Sometimes you have no choice...you have to sell your home but you owe more money on your home than you can sell it for in the current real estate market here in Andover. If so, a short sale can be a very good solution to your problem.  Still, there remain many myths about short sales and unfortunately many homeowners risk foreclosure unnecessarily  because of these myths.  Let's take a look at the truth about short sales.  Seven short sale myths are:

1. Short sales are impossible and never get approved. It is true that short sales are more difficult but they are not impossible. A Certified Distressed Property Expert (CDPE)  has extensive training to help homeowners in distress.  By engaging the services of a CDPE you're chances of completing a successful short sale improve significantly.
2. Banks Don’t Accept Short Sales. In reality, banks, too, would like to avoid foreclosure whenever possible, but it is critical that your realtor has special training the process.  Many attempted short sales fail simply because the process was mishandled.
3. You must be behind on your mortgage to negotiate a short sale. Many lenders today focus on verifiable hardship, monthly cash flow shortfall and insolvency, not just people in default.
4. Buyers Avoid Short Sales. Many agents report that buyers call them looking for short sales and an experienced, knowledgable real estate agent understands short sales are becoming synonymous with a “good deals.”
5. Listing your home as a short sale is embarrassing. Recent estimates state that 1 out of 5 homeowners in the U.S. is in this situation. You are not alone!
6. Banks prefer to foreclose. Banks do NOT want to foreclose. Banks, investors and the federal government have all publicly stated that if a person qualifies for a short sale, then the deal needs to be considered.
7. There is not enough time to negotiate a short sale before my foreclosure. Many lenders today will stall a foreclosure up to the final day of the process, with a legitimate contract.

I am one of the few realtors in the area who is a Certified Distressed Propery Expert. I have the training necessary to help homeowners who may be having difficulty keeping up with their mortgage payments. Search here for homes for sale in Andover and surrounding communities.

 

Even woodchucks know its a good time to find a new home in Andover!  But unlike these critters, if your thinking about buying a home, you need know how much of a mortgage you can afford.  It's important to do this even before you begin to look at houses for sale. Otherwise you may be wasting your valuable time and you may be disappointed to learn you cannot afford the home you'd like to buy.  The first step in determining what type of home you can afford is to figure out what lenders call your "debt-to-income ratio." Most lenders use 36% and under, but you might be more comfortable with a lower number such as 28% of your gross monthly income for housing expense. The following are the steps will help you calculate how much home you can afford.

1. Figure out all of your debt. Multiply your gross monthly income by .36 to find your total allowable monthly debt.
2. Add up all of your fixed monthly expenses.
3. Subtract your fixed monthly expenses from your total allowable monthly debt.

This number is the amount that you have for your mortgage payment, your home owner’s insurance and your property taxes.  For more help figuring out your total allowable monthly debt see a home affordability calculator.

You've heard about it...you've read about it...but do you know that the tax credit for first time homebuyers expires on December 1, 2009?  That means you MUST close on your new home before the deadline.  First time homebuyers will be entitled to claim a total tax credit of $8,000 or 10% of the purchase price, whichever is less.  The credit is allowed for your primary residence and will only have to be re-paid if you sell your home within two years of purchase.  Once you identify a home to purchase, there are inspections, appraisals and legal documents to prepare, that's why most most closings in Andover and North Andover take forty five to sixty days, so the time to search for your home is now!   For more information about this credit go to the IRS website or contact me for more information on how you can take advantage of this historic legislation! 

Although mortgage rates are still above the record lows, mortgage interest rates have been falling. Rates rose this past June due to the yields on climbing long-term government debt. Investors became concerned that large amounts of extra government debt would trigger inflation. Experts speculate that mortgage rates fell this past week from market concern due to the weakening labor market. Whatever the reason, lower mortgage rates are great news for home buyers and home sellers in Andover, North Andover and the Merrimack Valley. Look at the difference just a 1% point increase makes in these loans.

People are waiting for prices to continue to drop; however, when rates go from 5% to 7%, it is the equivalent of a 20% increase in price to the borrower. Now is the time to buy.  For more information on how even small changes in fixed mortgage rates contact me at RE/MAX Partners in Andover, MA.  

Many people are afraid thieves will somehow get their information off of the computer. This is possible for them to do, but there are ways to protect yourself. Some people find that installing anti-virus, anti-spy ware, firewall protection and hardware firewalls is over-kill. In reality, when protecting your personal information you should always err on the side of caution.  

• When setting up wireless Internet access, educate yourself on wireless security.
• Store your backed-up data away from your computer.
• Never open an e-mail from someone you don’t know.
• Never open attachments unless you know where it is coming from. Make sure you set up Windows to show all file extensions.
• Make sure you set up your browser to block pop-ups.
• Never use your credit card on a website that does not direct you to a secure page with a URL starting with https://.
• Use different passwords for every single site you use that asks for one. Always mix letters and numbers to make up that password.
• Never keep financial information on your hard drive.

For more information on Computer Safety go to Internet Safety Solutions.

Identity theft has become a very serious problem in the United States. Thieves are not only stealing your personal information for themselves, but many simply sell it on the black market to another thief. They are using this personal information not only to obtain cash and credit cards, but high-cost medical procedures as well. There are a myriad of ways that thieves can steal your private information. Be aware of the following threats:

• Phishing: This is an e-mail in your Inbox that claims to be from either your bank, Paypal or Ebay, or other online service. They then ask you to click on a link and enter your personal information.
• Spoofing and Pharming: Thieves can actually redirect legitimate website traffic to an imposter site, where they will ask you to enter your personal information.
• Spyware: It is very common for people to mistakenly download illicit software and find themselves accidentally clicking on a pop-up. This opens the door for thieves to steal your credit card numbers and passwords by accessing information on your hard drive.
• Vishing: This is “voice phishing”, which is when a thief sends you a phone message asking you to key in your personal information.
• Bank card skimming: Thieves actually add a fake ATM slot and camera to a legitimate cash machine so they can copy your account information. Servers at restaurants can also be armed with a portable card reader.
• Thieves try to steal your wallet and can also go through your garbage for personal information.

If you are concerned that you are an Identity theft victim go to the Federal Trade Comission website for more information.

If you are in the enviable position right now of looking to buy a home, enjoy the current market: the buyer’s market. Home sellers in Andover and North Andover are happy to start a dialogue with a potential buyer, so arm yourself with any and all information to get the best deal possible!

• Right now you have more time to look, so you will be better armed with the knowledge of which houses have been sitting on the market for a while. These homeowners might be more likely to negotiate.
• Consider looking at new construction. Builders sometimes offer incentives and sometimes have very attractive financing programs.
• In certain areas that have been hit a bit harder by the market downturn, you certainly do have the upper hand whilst negotiating - and can always ask for an upgrade or a major repair before finalizing the deal.
• Sellers are often happy to work with your timeline. Don’t be afraid to ask for a closing date that's convenient for you.
• Even some lenders are willing to negotiate. You might ask for free private mortgage insurance, a better interest rate or even lower closing costs.
• Hire a Buyer Agent who is familiar with the area.  A good buyer agent will know her local market and be well equipped to negotiate the sale on your behalf.
• Sign up for free MLS listing alerts so you can see what homes are available in your Andover and North Andover neighborhood.

For more information on the current real estate market go to Housing Predictor.

Choosing the right community is so important, as how you can you really love where you live unless you love the neighborhood?  There are many different neighborhoods in Andover and North Andover.  Some may suit your needs more than others. In the frenzy of finding a home and scheduling moving day, many people forget that researching the neighborhood is one of the most important ways to insure happiness at your new destination. Before making your final decision on a home, don’t forget to:

• “Profile” the neighborhood. Ask yourself these questions: Is the quality of the school system important? Is the commute do-able for you? Do you like to be within walking distance to shops and restaurants? Do you like quiet?
• Once you zero in on a neighborhood you like you must research all school information, crime statistics, parks and recreation, neighborhood association fees and tourist attractions. Armed with this information it will be easy to make a wise decision for you.
• Take the time to visit. Don’t downplay your first impression. Take note of the community’s rush hour patterns, it’s social ability factor, it’s streetlights at night. Drive by the schools. Shop in the local grocery store. Try to meet some of your potential neighbors. All of these visual clues can be very revealing.

For more interesting ways to figure out if a neighborhood is right for you click here.  And be sure to ask me about my Buyer Agent services, I will develop a customized home search specifically taylored for  your homeownership needs. Also have free email alerts sent directly to your inbox for homes for sale in your favorite Massachusetts neighborhood.