Paul Bozek

I think this product deserves some more attention so I decided to repost. We've had much success with it in the last recent couple months. The closings don't appear to be delayed much if any because of the product. We've been running into 45-60 day escrows because of last minute problems with buyer paperwork or banks not responding. Other than that, smooth sailing! It's proven that when working with buyers not only do they need their own down payment, but they also should have monies available for expenses incurred on top of what's financed through the loan as problems arise mid project. Just a word of caution.

203k STREAMLINE

• Used for minor cosmetic work
• Should ideally be used for no more than 3 jobs total
• No consultant / engineer / architect required
• Property cannot be vacant for more than 30 days.
• Work must be completed within six months.
• Work must be professional.
• If job requires a permit, borrowers must get a permit and a sign-off.
• Work must commence within 30 days from closing.

Eligible Repairs & Improvements

• Roofs, gutters and downspouts
• HVAC systems (heating, venting and air conditioning)
• Plumbing and electrical
• Minor kitchen and bath remodels
• Flooring: carpet, tile, wood, etc.
• Interior and exterior painting
• New windows and doors
• Weather stripping & insulation
• Improvements for persons with disabilities
• Energy efficient improvements
• Stabilizing or removing lead-based paint
• Decks, patios, porches
• Basement completion and waterproofing
• Septic or well systems
• Purchase of new kitchen appliances or washer / dryer

Repairs Not Permitted

• Landscaping or yard work
• Major remodeling
• Moving a load-bearing wall
• Room additions or add-ons to the home
• Fixing structural damage

Disbursement of Payments

• Maximum of two payments to each contractor, including the borrower, providing the borrower works under a "self help" plan.
• No more than a 50% advance is allowed.
• Do-it-yourself allowances do not include labor; only materials costs are allowed.
• Final payment is paid after submission of evidence of payment to sub-contractors / suppliers or other possible lien claimants.

Good Luck and as always feel free to contact me directly with any questions you might have regarding my postings or products!

I'm coming across many buyers and agents asking about what can be used for down payment now that the seller assisted down payments are gone. I have copied below from the HUD handbook as to what are acceptable down payments. As you can see, buyers can "borrow" these funds as logn as they are ones that are allowed.

Collateralized Loans. Funds can be borrowed for the total required investment as long as satisfactory evidence is provided that the funds are fully secured by investment accounts or real property. Such assets may include stocks, bonds, real estate (other than the property being purchased), etc.

In addition, certain types of loans secured against deposited funds, such as signature loans, the cash value of life insurance policies, loans secured by 401(k)s, etc., in which repayment may be obtained through extinguishing the asset; do not require consideration of a repayment for qualifying purposes. However, in such circumstances, the asset securing the loan may not be included as assets to close or otherwise considered as available to the borrower.

An independent third party must provide the borrowed funds. The seller, real estate agent or broker, lender, or other interested third party may not provide such funds. Unacceptable borrowed funds include signature loans, cash advances on credit cards, borrowing against household goods and furniture and other similar unsecured financing.

I was curious to see what people have out there when it comes to hard money. I am interested to see what LTV private money lenders will finance using After Repair Value. I heard that there are lenders out there that will actually let you do 100% purchase off sales price based on the ARV. The #s have to work of course. I am interested to see what you guys have out there! Please Post!

I think these numbers were expected. On a positive side, we should continue to see activity from first time home buyers and investors trying to take advantage of the more affordable market.

Loans in foreclosure have doubled over the past year, while delinquency rates continue to soar.

A record 1.249 million homes were in foreclosure during the second quarter of 2008, according to a report released Friday by the Mortgage Bankers Association.

And new foreclosure proceedings were started on about 490,000 of the 45 million home mortgages serviced by MBA members. That's up 9% from the 448,000 starts recorded in the previous quarter.

Mortgage delinquencies continued their grim rise during the three months ended June 30, with 2.9 million homeowners falling behind on their loan payments, apart from those already in foreclosure. Compared with a year ago, delinquencies are up more than 25%, while loans in foreclosure have nearly doubled. Both levels were the highest ever recorded by the survey.

"The national foreclosure numbers continue to be driven by the hardest hit states continuing to get much worse," said Jay Brinkmann, MBA's Chief Economist. "The increases in foreclosures in California and Florida overwhelmed improvements in states like Texas, Massachusetts and Maryland."

California and Florida accounted for 39% of all foreclosures started during the quarter. Those two states as well as six others - Nevada, Arizona, Michigan, Rhode Island, Indiana, and Ohio - all had foreclosure start rates higher than the national average.

Subprime still sinking

Once again, subprime adjustable rate mortgages (ARMs) weighed heavily on the down side. Subprime ARMs, which represent only 6% of all loans outstanding, accounted for 36% of all foreclosures started during the quarter. In other words, 6.63% of all subprime ARMs went into foreclosure during the period - nearly 20 times the rate for fixed rate prime mortgages.

"Even if subprime stabilizes," said Mike Larson, a real estate analyst with Weiss Research, "I would anticipate that prime loans would start to play catch-up. We're not just confronting a credit crisis any more, we're dealing with broad economic problems that are contributing to delinquency rates."

On the bright side, Larson says the deterioration in home prices has slowed in the last couple of months, which could help delinquencies level off as well.

"They'll continue to worsen," he said, "but not at the pace of the last year."

Nevertheless, Jay Brinkmann warned that it would be fruitless to try an call a bottom in this market any time soon.

The trend has been steadily pointing towards mortgage brokers being fazed out. I think many major companies will follow suit and reduce retail and completely shut down wholesale divisions. Hopefully in the process we don't hit more of a slump due to transition in lending practices.

The lender says it plans to shrink its mortgage lending business because of the weak housing market.

Lender GMAC Financial Services said Wednesday it will close all of its 200 retail offices and lay off about 5,000 employees as part of plan to reduce its mortgage lending and servicing because of the housing market downturn.

The majority of the layoffs are slated for GMAC's mortgage lending division, Residential Capital LLC, known as ResCap, and will reduce work force at the unit by 60%, the company said.

In the first half of the year, ResCap's U.S. mortgage loan production was valued at about $35.7 billion, down nearly 39% from the same period in 2007.

"While these actions are extremely difficult, they are necessary to position ResCap to withstand this challenging environment," Tom Marano, ResCap's chairman and CEO, said in a statement. "Conditions in the mortgage and credit markets have not abated and, therefore, we need to respond aggressively by further reducing both operating costs and business risk."

Some 3,000 employees may get their pink slips this month. The rest are expected to lose their jobs by the end of the year, the company said.

ResCap is also the latest in a long list of lenders that have stopped using external, wholesale brokers to originate loans. Wachovia Corp. (WB, Fortune 500) exited the wholesale mortgage lending business in July, for example, while rival Bank of America Corp. (BAC, Fortune 500) got out of the business several months ago.

Richfield, Minn.-based ResCap will continue lending through brands such as Ditech or GMAC Mortgage Direct, which customers can reach online or through call centers, said spokeswoman Jeannine Bruin.

"We're not going to have a retail presence where customers walk in the door," Bruin said. (But) "we are very much still originating loans and servicing the customer."

To cover severance costs, ResCap will take a charge of $90 million to $120 million against earnings.

In July, GMAC said ResCap's second-quarter losses widened to $1.86 billion from $254 million in the prior-year period. To try to reverse the trend, ResCap took steps to cut back the size and risk of its balance sheet, and boosted loan loss provisions.

Like many lenders have done since the credit market dried up, ResCap has focused on originating home loans that it can resell to government-sponsored mortgage companies Fannie Mae (FNM, Fortune 500) and Freddie Mac (FRE, Fortune 500).

ResCap has also virtually abandoned the market for subprime loans. In the first half of this year, ResCap made just 13 subprime loans, compared with nearly 26,000 in the same period a year earlier.

At the end of June, 14.6% of ResCap's U.S. home loans were at least 60 days past due. That's up slightly from the close of the first quarter, but down from 15.5% on June 30, 2007.

New York-based GMAC is controlled by Cerberus Capital Management, but automaker General Motors Corp (GM, Fortune 500). still holds a 49% stake in the business.