Category: Investing

Information and tips on investing in real estate.

Room By Room Renting

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Congratulations on investing in real estate! A savvy move for the organized, prepared, and patient investor!

I know your smart and you’ve done your research. You have reviewed any Property Owner Association documents for any restrictions or guidelines that you must abide by, and now you’re ready to get some tenants in there and make some money! What’s that you say? You also know how much the average rental amount is for rentals in the neighborhood? That’s great! But is that rental amount per home or per room?

In some cases, renting out rooms versus the entire home may be more lucrative. There are some pros and cons to consider, but with a little bit of planning, you may find that you might prefer to offer room by room renting.

Pros:

  • Lower rent amounts give you a broader range of qualified applicants.
  • In most states, room by room renting gives you greater control over who can rent a room — i.e., women only, etc.
  • If one room tenant fails to pay their rent, you may still get paid from the others. Some rent is better than no rent!
  • You can charge different amounts for different room sizes or amenities.
  • Individual room rental amounts may add up to more than what you could get renting the entire home to a single tenant.

Cons:

  • More tenants, means more paperwork and organization.
  • You’ll have to find a way split utility payments among the tenants, although your tenants can manage this.
  • Individual tenants may mean more neglect to prepare for in common areas such as the kitchen or laundry area.

So weigh your options, and think about your own pros and cons to room by room renting. Good luck!

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Categories: Investing Property Management

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Loss Mitigation Contact Numbers

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Are you behind on your mortgage payments? Do you think you are going to have trouble paying your mortgage in the near future? Read my post entitled “Can’t Pay Your Mortgage” for more information. Or maybe you’re interested in investing in property in pre-foreclosure status? If so, you may find this information helpful: a compiled list of loss mitigation department contact numbers and websites of various lenders that you (or your listing agent) may need.

ABM-AMRO Mortgage (800) 783-8900

Web: https://www.mortgage.com/C3/application.bus

Accredited Home Lenders(877) 683-4466

AMC Mortgage Services (Also handles loans originated by Ameriquest and Argent) (800) 211-6926

1600 McConnor Parkway

Schaumburg, IL 60173

Web: https://www.myamcloan.com/malwebapp/begin.do

American Home Mortgage Corp.(877) 304-3100*

Ameriquest Mortgage (Debt collection — see AMC Mortgage Services) (800) 211-6926

Aurora Loan Services (Debt collection) (800) 550-0508

By Overnight Mail:

601 5th Avenue

Scottsbluff, NE 69361

Attn: Customer Service

By Regular Mail:

P.O. Box 1706

Scottsbluff, NE 69363

E-mail: ccnmail@alservices.com

Web: https://www.alservices.com/Consumer/UI/SSL/…UI%2fSSL%2fServ icing%2fDefault.aspx

Avelo Mortgage LLC (866) 992-8356*

Bank of America(800) 846-2222

BB&T Mortgage (800) 827-3722*

AmTrust Bank (fka Ohio Savings Bank) (888) 696-4444

Beneficial (800) 333-5848

Central Pacific Bank (800) 342-8422*

Charter One (800) 234-6002

Chase (800) 446-8939

Chase Home Finance (800) 848-9136 (customer service) (858) 605-2181 (delinquency customer service)

Chase Home Finance-New Jersey(800) 446-8939*Chevy Chase Bank(800) 933-9100*

Web: https://chaseonline.chase.com/chaseonline/l…mp;LOB=COLLogon

Chase Manhattan Mortgage

(800) 446-8939 (Ohio Servicing Center)

(800) 526-0072 (Florida Servicing Center)

(800) 527-3040 x533 (Florida Servicing Center)

Chevy Chase Bank (800) 933-9100

Web: https://www.chevychasebank.com/htm/payment.html (Payment Addresses)

Citi Financial Mortgage (800) 753-3673

Citimortgage (800) 283-7918

Countrywide (800) 262-4218 or (877) 744-7691

https://customers.countrywide.com/se…t_login254.asp

Ditech (800) 852-0656 (800) 449-8582

Downey Financial Corp.(800) 824-6902, ext. 6696

Deutsche Bank National Call Number on Mortgage Statement

EMC 800-723-3004

P.O. Box 141358

Irving, TX 75014-1358

Web: https://www.emcmortgageservicing.com…cnsecurity.asp

EverBank (800) 669-7724 ext. 4730

Equity One (Debt collection) (866) 361-3460

First Horizon Home Loans (800) 489-2966*

Fifth Third Bank (800) 375-1745 Option 3

First Merit Bank (888) 728-9931

Flagstar Bank (800) 968-7700, ext. 9780

Fremont Investment & Loan (866) 484-0291

GMAC Mortgage (800) 850-4622

GreenPoint Mortgage Funding (800) 784-5566, ext. 5383*

Green Tree (877) 816-9125

Homecomings Financial (800) 850-4622*

HomeEq Mortgage Servicing ( Debt collection) (866) 822-1471

Household Finance (A HSBC Co.) (800) 333-5848

Household Mortgage (800) 333-4489

HSBC Mortgage (800) 338-6441

Default Resolution Team (if long term problem)

2929 Walden Avenue

Depew, NY 14043

(888) 648-3124 Loss Mit

(732) 352-7519 Fax

Web:http://us.hsbc.com/personal/mortgage…fficulties.asp

Huntington National Bank (800) 323-4695

Indymac Bank (877) 736-5556

C/O Loan Resolution Department

P.O Box 7014

Pasadena, CA 91107

(Monday – Friday 6:15am-7:15pm. (Pacific Time))

Web: https://www.indymacbank.com/contactu…Resolution.asp

Irwin Mortgage (888) 218-1988

P.O Box 7014

Pasadena, CA 91107

Web: https://www.irwinmortgage.com/wps/portal/&#…3sdAvyHZUBAAqwx 9c

E-mail: deliquency.prevention@irwinmortgage.com

James B. Nutter & Company (800) 315-7334

Key Bank (800) 422-2442

LaSalle National Bank (800) 783-8900

Litton Loan Servicing (800) 999-8501 or (800) 548-8665

Fax (713) 966-8820

4828 Loop Central Drive

Houston, Texas 77081-2226

Web: https://www.littonloan.com/index.asp

Loss Mitigation Department Hours:

Monday Eastern: 9 a.m. – 7 p.m. Central:8 a.m. – 6 p.m. Mountain:7 a.m. – 5 p.m. Pacific:6 a.m. – 4 p.m.

Tuesday-Thursday Eastern:9 a.m. – 9 p.m. Central:8 a.m. – 8 p.m. Mountain:7 a.m. – 7 p.m. Pacific:6 a.m. – 6 p.m.

Friday Eastern:10 a.m. – 6 p.m. Central:9 a.m. – 5 p.m. Mountain:8 a.m. – 4 p.m. Pacific:7 a.m. – 3 p.m.

Default Counseling Department representatives are also available most weekends on Saturday from 8 a.m. to 12 p.m. and Sunday from 10 a.m. to 2 p.m. (CST).

Midland Mortgage (800) 552-3000 or (800) 654-4566

Web: https://www.mymidlandmortgage.com/My…ogin/Login.asp

Mortgage Lenders Network (800) 691-0129

E-mail: customerservice@mlnusa.com

Web: http://www.mlnusa.com/customers/info_credithelp.asp

Mortgage Electronic Registration Systems (888) 679-6377

National City (800) 367-9305, Ext. 53221 or (800) 523-8654

Attention: Homeowner’s Assistance

3232 Newmark Dr.

Miamisburg, Ohio 45342

(8AM-10:30PM ET, Monday – Thursday)

(8AM-5PM ET, Friday)

(8AM-Noon, Saturday)

Web: http://www.nationalcitymortgage.com/…assistance.asp

Nationwide Advantage Mortgage Company (800) 356-3442, ext. 6002*

NationStar Mortgage (888) 850-9398* Press 0 for operator

New Century Financial Now Carrington Mortgage Services (800) 790-9502 or (877) 206-9904

(6:00 a.m. to 7:00 p.m. Pacific Time, Monday – Thursday)

(6:00 a.m. to 6:00 p.m. Pacific Time, Friday)

Web: https://myloan.newcentury.com/webapps/servi…yloans/index.do

NovaStar Mortgage Loan Resolution Department (888) 743-0774 Non-English: (888) 743-0774, ext. 4523

Ocwen Federal Bank (800) 746-2936 or (877) 596-8560

Web: http://www.ocwencustomers.com/csc_fa.cfm

Attention: Financial Information

12650 Ingenuity Drive

Orlando, Florida 32826

or

Ocwen Financial Corporation

1661 Worthington Rd., Suite 100

West Palm Beach, Florida 33409

Phone: 877-226-2936

For serving Ocwen with legal process, please send to their registered agent:

Corporation Service Company

2711 Centerville Road, Suite 400

Wilmington, DE 19808

Phone: 561-682-8000, x8386

Option One (866) 711-1962 or (888) 275-2648

Web: http://www.oomc.com/servicing/servicing_baifaqs.asp

PHH Mortgage (Formerly Cendant) (800) 257-0460

For borrowers facing possible delinquency: (800) 330-0423*

For borrowers in the foreclosure process: (800) 750-2518

ResMae Mortgage Corp.(877) 473-7623, ext. 5944

Saxon (800) 665-7367

Select Portfolio Servicing (888) 818-6032

Fax: (801) 293-3936

Loan Resolution Department

P.O. Box 65250

Salt Lake City, UT 84165-0250

(Monday – Thursday 10:00 a.m. – 10:00 p.m. EST)

(Friday 10:00 a.m. – 7:00 p.m. EST)

(Saturday 9:00 a.m. – 1:00 p.m. EST)

Web: http://www.spservicing.com/services/custom…nresolution.htm

SkyBank (800) 290-3359

Sun Trust Mortgage (800) 634-7928

PO Box 26149

Richmond, VA 23260-6149

Mail Code RVW 3003Web: https://www.suntrustmortgage.com/generalquestions.asp#

Third Federal Savings (888) 844-7333

US Bank (800) 365-7900

Wachovia Bank of Delaware (866) 642-8608

Washington Mutual (866) 926-8937 or (888) 453-3102 or (800) 478-0036 or (800) 254-3677

Waterfield Mortgage (800) 957-7245

Fax: (260) 459-5390

c/o Loss Mitigation Dept.

7500 W. Jefferson Blvd.

Fort Wayne, IN 46804

(7 am – 10 pm EST Monday – Thursday)

(7 am – 9 pm EST Fridays)

(8 am – 2 pm EST Saturdays)

E-Mail: saveyourhome@waterfield.com

Web: http://www.waterfield.com/scripts/cgiip.ex…rvices/delqasst

Wells Fargo (877) 216-8448 or (866) 261-5642 or (800)766-0987 or (800) 678-7986 for payment assistance

Borrower Counseling Services

Monday – Friday 8:00 a.m. – 9:00 p.m., CT

Saturday 9:00 a.m. – 2:00 p.m., CT

Web: https://www.wellsfargo.com/mortgage/account/

Wendover Financial Services Corporation (800) 934-1081 or (800) 436-1022

Web: http://www.wendover.com/borrowers.html

Wilshire Credit Corporation (888) 502-0100

P.O. Box 8517

Portland, OR 97207-8517

From 6 a.m. to 5 p.m. (Pacific time) Monday through Friday

Web: http://www.wfsg.com/borrower/borrower.aspx

(Lender/Servicer Loss Mitigation Phone Numbers & Contact Information created by Moe Bedard of Corona, CA, reposted here at CircleDebt.com.)

Categories: Investing Short Sales and Foreclosures

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Creative Ways to Afford a Home

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  1. Investigate local, state, and national downpayment assistance programs. These programs give loans or grants to cover all or part of your required downpayment. National programs include the Nehemiah program (http://www.getdownpayment.com) and the American Dream Downpayment Fund from the U.S. Department of Housing and Urban Development (http://www.hud.gov).
  2. Get the seller to provide financing. In some cases, sellers may be willing to finance all or part of the purchase price of the home and let you repay them gradually, just as you do a mortgage.
  3. Consider a shared-appreciation, or shared equity, arrangement. Under this arrangement, your family, friends, or even a third-party may buy a portion of the home and thus share in any appreciation when the home is sold. The owner/occupant usually pays the mortgage, property taxes, and all maintenance costs, but all investors’ names are usually on the mortgage. There are companies that can help you find such an investor if your family can’t participate.
  4. Get help from your family. Perhaps a family member will loan you money for the downpayment and/or act as a cosigner for the mortgage. Lenders often like to have a cosigner if you have little credit history.
  5. Lease with the option to buy. Renting the home for a year or more will give you the chance to save more toward your down payment. And in many cases, owners will apply some of the rental amount toward the purchase price. You usually have to pay a small, nonrefundable option fee to the owner.
  6. See if you can qualify for a short-term second mortgage to give you the money to make a higher downpayment. This may be possible if you have a good income and little other debt.

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Categories: Buying Investing

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Landlord Virgin

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So, Mr. Roper, you think you found the perfect rental property, huh? And this is your first one too? Congratulations! You’ve realized that real estate is a great investment, especially long term, and if you played your cards right, you may be able to generate positive cash flow each month. Let’s take a moment review a checklist of items you need to consider for your newly acquired rental, and before you know it, you’ll be on your way to the joys of property management:

  • Draw up a lease that protects you and your property.
  • Get to know the people in the neighborhood. Exchange phone numbers if possible.
  • Do a credit and background check on all your applicants.
  • Determine where you want to receive the rental payments.
  • Make sure you know the condition and state of all major appliances. Be prepared for repairs.
  • Make sure you know the condition and state of interior and exterior structures. Are the pipes old? How old is the roof? Set funds aside if needed.
  • Set a schedule for annual maintenance and don’t forget about it! Neglecting general maintenance can have expensive repercussions.
  • Get a market analysis report from a local real estate agent to help set your rental price.
  • Do a pre-move-in walk-through with your renters and include photographs.
  • Know the eviction process in the property’s jurisdiction.

A lease is a legal contract and your best bet is to consult with a real estate attorney for advice about terms you can include in your rental agreement.

These are just a few items to consider, but you’re smart, you’ll do well! Good luck and happy landlording!

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Click Here!

Categories: Investing Property Management

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Capital Gains Tax in Real Estate

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When you sell a stock, you owe taxes on your gain—the difference between what you paid for the stock and what you sold it for. The same is true with selling a home (or a second home), but there are some special considerations.

How to Calculate Gain

In real estate, capital gains are based not on what you paid for the home, but on its adjusted cost basis. To calculate this:

  1. Take the purchase price of the home: This is the sale price, not the amount of money you actually contributed at closing.
  2. Add adjustments:
    • Cost of the purchase—including transfer fees, attorney fees, inspections, but not points you paid on your mortgage.
    • Cost of sale—including inspections, attorney’s fee, real estate commission, and money you spent to fix up your home just prior to sale.
    • Cost of improvements—including room additions, deck, etc. Note here that improvements do not include repairing or replacing something already there, such as putting on a new roof or buying a new furnace.
  3. The total of this is the adjusted cost basis of your home.
  4. Subtract this adjusted cost basis from the amount you sell your home for. This is your capital gain.

A Special Real Estate Exemption for Capital Gains

Since 1997, up to $250,000 in capital gains ($500,000 for a married couple) on the sale of a home is exempt from taxation if you meet the following criteria:

  • You have lived in the home as your principal residence for two out of the last five years.
  • You have not sold or exchanged another home during the two years preceding the sale.

Also note that as of 2003, you also may qualify for this exemption if you meet what the IRS calls “unforeseen circumstances,” such as job loss, divorce, or family medical emergency. Consult your tax professional for detailed information.

Categories: Investing Selling

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Is now the time to invest in tax liens?

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It’s a buyers market these days: market values are down, appraisal values are down, short sales and foreclosures are on the rise. If you happen to have ready cash available for a down payment (long gone are the days of 100% investment loans), now is the time to invest. But say you don’t have $20k – $60k liquid cash to plop down right now? Well say hello (again) to tax liens!

With the mortgage situation going the way it is, numerous homeowners are falling behind on their mortgage payments. Chances are those same homeowners have an escrow account set up with their lender for home insurance payments and tax payments. If a mortgage falls behind, that could mean that the taxes on the property have not been paid, and so, the state can issue a tax lien against the home. These tax liens go up for auction to any willing bidder in an effort for the state to receive the funds that they would have normally received from the homeowner. Those tax liens can start out as little as a few hundred dollars, upwards to a few thousand, but definitely less than the price of home– even in a down market. And almost like winning the lottery, the winning bidder gets to own a piece of property for an incredible discount! But not so fast, Tonto! Some states offer a recovery period for delinquent homeowners, in which case, they pay their taxes, any late fees, PLUS interest back to the winning bidder and get to keep their home.

Tax liens? Yes! Yet another way to diversify that portfolio!

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Categories: Investing

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What Is A Short Sale?

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If you’re keeping up to date with real estate news, chances are you’ve heard the word “foreclosure” more and more. If you want more detailed information about foreclosures, then read my post called, “What Is A Foreclosure”. For this post, just know that a property in foreclosure means that the homeowner can no longer pay the mortgage. What does this have to do with a short sale? Read on.

When a homeowner can no longer afford the payments on their property, they may try to refinance their loan to a better rate in order to lower their monthly payments and avoid foreclosure. But when the total balance of a mortgage exceeds the current appraised value of the property, refinancing that mortgage becomes extremely difficult, if not impossible. It becomes a huge risk for any lender to lend money on an asset that is worth less then they are lending. So what is a homeowner to do? They cannot refinance but cannot afford the mortgage. The only option they have is to sell the property. But since the appraised value of the house is less than what the homeowner owes, the home must be sold at a loss. This loss is considered a short sale from a lenders perspective since they are willing to accept less than the amount they are owed as payment in full.

Categories: Investing Short Sales and Foreclosures

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What Is A Foreclosure?

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Foreclosure is a process by which a lender takes title or forces the sale of a property as a result of the borrower’s failure to comply with the terms of the mortgage. The first missed payment begins the foreclosure process. Bringing the loan current (paying all the mortgage payment(s) and fee(s) due) or selling the property ends the process.

If after numerous attempts to collect payment from the homeowner fails, lenders will begin legal proceedings to foreclose on the property through a Notice of Intent to Foreclose posted in a local newspaper and at the county/city courthouse. The notice lists general information about the property and a date the property will be sold at auction.

Depending on the auction terms, the lender may set a reserve amount (a minimum amount they will sell the house). If that reserve amount is not met, the home becomes property of the lender, or Real Estate Owned (REO).

Depending on the state, a house sold at a foreclosure auction may go into a redemption period wherein the homeowner can buy back their home if they can pay for the entire loan, including any accumulated fees.

Categories: Investing Short Sales and Foreclosures

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