Category: Condominium & Homeowners Associations
Representing both the National Multi Housing Council and the National Apartment Association, NMHC senior vice president of government affairs Cindy Chetti praised the Federal Housing Finance Agency for proposing separate fixes for the single-family and multifamily housing markets.
The comments came after the FHFA announced its intentions to unwind its conservatorships of Freddie Mac and Fannie Mae. Chetti noted the differing initiatives to fix both the for-sale and rental housing sectors is vital to the overall goal of repairing the nation’s real estate crisis.
“We commend FHFA for recognizing that the GSEs’ multifamily programs are working well, were not part of the housing meltdown and require a separate solution from single-family housing finance reform,” said Chetti.
One suggestion Chetti made on behalf of the NMHC and NAA was for the FHFA to implement separate timetables for the winding down of Freddie and Fannie, citing the different states of the single-family and multifamily markets.
One way in which Freddie is working to help fix the housing market is to continue offering real estate-owned properties to investors for conversion to rentals. Once purchased, these investors would likely hire property managers, thus providing a boost to the rental management industry.
There has been a lot of talk about the horrific economy, and how it has essentially stolen the life out of the real estate market, including the options to qualify for lending. Well, the truth is that lending is still very much alive, and in some areas thriving. Granted those areas are few and far between, and others are still in decline, but the national qualification terms for lending remain constant.
What It Takes to Purchase a Home
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Today’s loan qualifications require buyers to have a much better credit rating than before; however, this does not require credit to be perfect. For instance, there are major banks that will qualify borrowers with a FICO score of 650. Before the collapse of the real estate bubble, that number was 565. The other factor is that the days of no income verification, no credit verification, or obtaining an immediate second to make the loan over 100% of the purchase price is a thing of the past.
Having 20% down, a FICO in the mid to high 600′s, and a job are the basic necessities for acquiring a home loan. The 20% down is not mandatory, but it will help with eliminating the Private Mortgage Insurance premium, or PMI that is attached to a loan payment for those that opt to only put down the minimum 3% for FHA loans.
Take a Look at Debt
Finally, look at your debt, and only count things that are mandatory as part of the overall debt calculation. This number will not include utilities, cell phones, or food bills. Things included are car payments, student loans, and credit cards. If the overall debt that is paid every month, including the new mortgage payment, is 43% or lower, then borrowers will be able to purchase the home they have been wanting.
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HOAs, or Homeowners Associations, are part of life for a lot of people. Some people love them, and others feel as though they are too expensive and too intrusive. Of course, a lot of HOAs are very different from others. There’s no ?one size fits all? definition of what they do, how they operate, what they cost, or what they require. If you’re thinking about living in a place that has an HOA, be sure to ask plenty of questions. Get a copy of the Association’s bylaws and actually read them.
You might find them very boring, and you might not want to take the time, but the rules and regulations in them will apply to you and everyone who lives in your neighborhood. Finding out what’s in there is vital to your happiness and to your understanding of what you’re paying for and what’s expected of you. You can have an HOA for a condominium or apartment building, and you can also have one for a housing development. Many places don’t have them, but those that do can be very nice places to live – provided you agree with the rules and the cost of living with the HOA.
Whether HOAs are good or bad is something that can be debated for a long time. They have their uses and advantages, but for some people, the cost of them and the restrictions that they impose just don?t outweigh the benefits that they get. HOA fees can range from a few hundred dollars per year to hundreds of dollars per month, and the rules can be very basic or incredibly restrictive. Most are somewhere in between, but always be sure to ask (and confirm) whether there’s an HOA and what you need to know about it before you sign a purchase or lease contract.