Now is the Time for Foreign Investment in Florida

Foreing Investment in FloridaThe diminished value of the U.S. Dollar is still offering the opportunity to make money for foreigners who invest in real estate in Florida.

With the rise in short-sales and foreclosures, foreign investors are able to buy properties for a low cost. Investors are able to buy a multi-family home for the cost of an efficient apartment in their own country.

In addition, because many Floridians are now renting instead of buying, there is an opportunity to make a true investment that will gain profit not only from an eventual resale, but also through renting out properties such as condos, which many foreign investors are buying in bulk.

Management and repair costs are also lower in Florida than in many foreign countries. Foreign investors who rent out some properties are estimated to receive a 10-15% return rate.

Even if you are looking to buy a second home on one of Florida’s sunny beaches, renting the property out on a seasonal basis can still result in profit gain (not to mention a nice place to get away.)

Foreign investment in Florida is becoming more popular, and, as a result, the number of properties available is diminishing, and the price of these properties is expected to increase as the demand does. The trend is already in full affect in South Florida areas such as Miami, and it is expected to be replicated in other coastal areas of Florida in a South to North pattern.

Sources: Condo Owner, Equity First

*Image courtesy of stockfreeimages.com

Short Sales for Non-Delinquent Borrowers in Florida and Across the U.S.

Starting TODAY, for the first time ever, borrowers, in Florida and across the U.S., who have never missed a mortgage payment will be able to short sell their houses if they can demonstrate a hardship, such as loss of employment or the death of a spouse.

This new rule will allow for underwater homeowners to get rid of their mortgage and also take advantage of the Mortgage Forgiveness Debt Relief Act of 2007, which is expected to expire at the end of the year.

Previously, only delinquent borrowers have been eligible for short sales.

There is a downside. The average person suffers a 150 point credit score loss after a short sale. This will be no different for non-delinquent homeowners because there is no special coding that differentiates them from those who went months without paying their mortgages.

Photo courtesy of stockfreeimages.comThe Federal Housing Finance Agency (FHFA) is currently in discussions with the credit industry to determine if and how this new law will affect credit scoring, but no solution has been found as of yet.

If you are considering a short sale, you should consult an attorney to discuss your options. There are many things changing in the housing market, and it is important to have all of the facts before making a decision.

Source: Inman News

Don’t Be A Victim: Fraudulent Out-of-Country Buyers

Most foreign property buyers have a legitimate interest in buying a property in the U.S. However, the increased number of scams in the real estate market from fraudulent out of state buyers have increased, causing title companies and real estate attorneys to lose time and money.

How the scams are conducted:

The first person that is contacted by the fraudulent party is usually the real estate agent. After they inquire about the property, they send information proving that they have the funds to purchase the property, and then ask to be referred to an attorney.

After the “buyer” gets in contact with the attorney, he sends a fake cashier’s check and asks the attorney to deposit the check in a trust account. Once the scammer knows the check is in the trust account, he will come up with an excuse to ask for the money back and have it deposit in a foreign bank account. When the attorney’s bank realizes that the check was fake it will be too late to recover the money that was drawn from the attorney’s trust account.

In most instances where scams take place, the prospective client will use an email address from one of the large services instead of a personal website address, claim to be a professional with a title that suggests wealth, or mainly be interested in land that is vacant. To avoid these scams, the first thing real estate agents should do is to confirm the identity of the client by verifying through a letter that the person is the true owner of the record.

Property Appraisals Required for Risky Mortgages

New proposed federal rules will require consumers with high-risk mortgage loans and people whose interest rates are above the average prime offer interest rates, to obtain property appraisals. Since the current Average Primer Offer Rate (APOR) is around 3.64 percent only, consumers with a typical mortgage of 5.14 percent or higher would have to get an appraisal. If the loan amount is above conventional loan limits, a rate higher than 6.4 percent would require the property to be appraised.

To prevent fraud using inflated appraisals, the seller of a home who bought it at a lower price in the six months before selling it will be required to obtain a second appraisal.

The rule is open for public comment until October 15, 2012. The Federal Reserve has posted more information about the rule, including a way to contact the issuing agencies, on its website.

Information obtained from: http://www.floridarealtors.org/NewsAndEvents/article.cfm?id=279791