By: Ellen Frick, Outreach Coordinator, NHS of Baltimore
At NHS of Baltimore, foreclosure prevention counselors have helped many individuals negotiate loan modifications with their lenders in order to mitigate the loss of a home. However, when it comes to foreclosure prevention, our services aid mainly homeowners, not renters. Yet according to the National Low Income Housing Coalition, an estimated forty percent of people losing their homes due to foreclosure are renters. In some cases, tenants may not even be aware of the risk until they are served an eviction notice.
I recently attended a Maryland Renters and Foreclosure Conference at the Federal Reserve Bank of Richmond in Baltimore. The event was also sponsored by the Public Justice Center, the Baltimore Homeownership Preservation Coalition (BHPC), and the Rental Housing Coalition. The conference emphasized that tenants have long been ignored in the mortgage crisis and only recently have their rights been protected through law.
Fortunately, just this past spring, new federal legislation was enacted to protect renters whose landlords are facing foreclosure. This federal law, Protecting Tenants at Foreclosure Act, aims to ensure renters are aware of a possible foreclosure and, if necessary, are given an eviction notice in a timely manner. One of the stipulations of the law states that if the tenant has more than ninety days left on their lease, they may have a right to stay in the property until the lease is expired. Keep in mind that many laws concerning renters’ rights still vary state-to-state and the new federal legislation does not supersede state laws.
If you are a renter in need of assistance call Baltimore Neighborhoods, Inc.’s (BNI) Tenant-Landlord Hotline at 410-243-6007 or the Maryland Department of Housing and Community Development’s (DHCD) information line at 877-775-0357. Another great resource is the Renters’ Rights brochure published by the Baltimore Homeownership Preservation Coalition and the Rental Housing Coalition.
Monday, December 21, 2009
Friday, December 18, 2009
Keeping Your Credit Score Healthy During the Holidays
By: Salina Greene, Outreach Coordinator, NHS of Baltimore
As we come closer to the end of the holiday season, it is possible to get caught up in various credit traps associated with purchasing gifts and essentials for your family. What many people don’t realize, is just how hard it is to get out from under heaps of credit card debt and what that debt can do to your credit. Bad credit can come back to haunt you in a number of ways.
For instance, if you’re interested in purchasing a new home, one of the biggest factors a lender will consider is your credit score. No one wants a huge shock when they go to apply for a mortgage, only to find out their credit is not up to par. The most common credit mistake consumers make during the holidays is opening a new line of credit with a retail store. This accounts for 10% percent of your credit score. These offers are usually associated with the promise of a large percentage off your purchase. Unfortunately, this pitfall is one of the best marketing tools retailers use to boost revenue. Hence, the more you spend on your current and new cards, the more it can have a very negative impact on your credit rating.
With big gift-purchase balances on your cards, it can be difficult to make on-time payments. Most people do not realize, even a single late payment of 30 days can significantly affect your score. Payment history accounts for approximately 35% percent of your overall score. For instance, a credit score of 780 can be brought down 90-110 points. A score of 680 can go down 60-80 points.
Getting stuck with a 10% interest rate can be devastating within itself. Lenders are becoming more strict as to who they approve because of the rise in foreclosure. An interesting fact to take into consideration is the new FICO score needed to qualify for a home purchase. Two years ago, a 620 credit score was good enough to get you the best rate on a 30-year fixed mortgage. Nowadays, a 700 score range is necessary for the same mortgage rate; a huge jump over the course of two years. If you do not know your credit score, feel free to access, www.AnnualCreditReport.com for your free copy. Under federal law, everyone is entitled to a free copy of their credit report once a year from each of the three national credit-reporting agencies. It’s never too late to establish a good line of credit.
As we come closer to the end of the holiday season, it is possible to get caught up in various credit traps associated with purchasing gifts and essentials for your family. What many people don’t realize, is just how hard it is to get out from under heaps of credit card debt and what that debt can do to your credit. Bad credit can come back to haunt you in a number of ways.
For instance, if you’re interested in purchasing a new home, one of the biggest factors a lender will consider is your credit score. No one wants a huge shock when they go to apply for a mortgage, only to find out their credit is not up to par. The most common credit mistake consumers make during the holidays is opening a new line of credit with a retail store. This accounts for 10% percent of your credit score. These offers are usually associated with the promise of a large percentage off your purchase. Unfortunately, this pitfall is one of the best marketing tools retailers use to boost revenue. Hence, the more you spend on your current and new cards, the more it can have a very negative impact on your credit rating.
With big gift-purchase balances on your cards, it can be difficult to make on-time payments. Most people do not realize, even a single late payment of 30 days can significantly affect your score. Payment history accounts for approximately 35% percent of your overall score. For instance, a credit score of 780 can be brought down 90-110 points. A score of 680 can go down 60-80 points.
Getting stuck with a 10% interest rate can be devastating within itself. Lenders are becoming more strict as to who they approve because of the rise in foreclosure. An interesting fact to take into consideration is the new FICO score needed to qualify for a home purchase. Two years ago, a 620 credit score was good enough to get you the best rate on a 30-year fixed mortgage. Nowadays, a 700 score range is necessary for the same mortgage rate; a huge jump over the course of two years. If you do not know your credit score, feel free to access, www.AnnualCreditReport.com for your free copy. Under federal law, everyone is entitled to a free copy of their credit report once a year from each of the three national credit-reporting agencies. It’s never too late to establish a good line of credit.
Friday, December 11, 2009
Federal Government Still Trying to Work Out Kinks in Home Affordable Mortgage Program
By: Ellen Frick, Outreach Coordinator, NHS of Baltimore
In response to the widespread mortgage crisis, the Obama administration established the Home Affordable Modification Program (HAMP) at the beginning of 2009. The program was created to help homeowners avoid going into foreclosure. If borrowers are eligible, lenders will work to negotiate the terms of the loan. For instance, the monthly payments may be decreased and the repayment period extended. So far, the program has surpassed its goal of aiding 500,000 homeowners who were at risk of losing their homes to foreclosure.
Once a loan modification is designed through HAMP, a homeowner must successfully pass through a trial period of the new terms before the modification can become permanent, which has sparked some criticism, as it is estimated that only around half of these modifications will become permanent. In a recent article, the New York Times investigates why so many loan modifications fail to become permanent. The article points out the possibility that a “permanent” modification may only last for five years.
Earlier this week, the government announced they were going to make changes to HAMP in light of the aforementioned criticisms. Examples of the HAMP revamp include extending the trial period, looking more closely at paperwork, and possibly even monetary sanctions for lenders who are not doing all they can towards granting the modification. Still, a foreclosuretruth.com blogger doubts these changes will improve the program. He wonders if the HAMP program will just dig a deeper hole, leading more homeowners into exotic mortgages beyond their means.
Despite the criticisms of HAMP, the program has made some important strides to ensure that homeowners who want to save their homes are given a good faith chance to do so. According to Rena Somar, Homeownership Advisor, NHS of Baltimore, HAMP has helped many of her clients get loan modifications when the lender may have otherwise cast a blind eye. However she says, “it is still too early to judge the overall success rate of the modifications because all of my clients who have received help from HAMP are still in the trail period”.
For more specifics on HAMP, including information on whether you are eligible to participate, click here.
In response to the widespread mortgage crisis, the Obama administration established the Home Affordable Modification Program (HAMP) at the beginning of 2009. The program was created to help homeowners avoid going into foreclosure. If borrowers are eligible, lenders will work to negotiate the terms of the loan. For instance, the monthly payments may be decreased and the repayment period extended. So far, the program has surpassed its goal of aiding 500,000 homeowners who were at risk of losing their homes to foreclosure.
Once a loan modification is designed through HAMP, a homeowner must successfully pass through a trial period of the new terms before the modification can become permanent, which has sparked some criticism, as it is estimated that only around half of these modifications will become permanent. In a recent article, the New York Times investigates why so many loan modifications fail to become permanent. The article points out the possibility that a “permanent” modification may only last for five years.
Earlier this week, the government announced they were going to make changes to HAMP in light of the aforementioned criticisms. Examples of the HAMP revamp include extending the trial period, looking more closely at paperwork, and possibly even monetary sanctions for lenders who are not doing all they can towards granting the modification. Still, a foreclosuretruth.com blogger doubts these changes will improve the program. He wonders if the HAMP program will just dig a deeper hole, leading more homeowners into exotic mortgages beyond their means.
Despite the criticisms of HAMP, the program has made some important strides to ensure that homeowners who want to save their homes are given a good faith chance to do so. According to Rena Somar, Homeownership Advisor, NHS of Baltimore, HAMP has helped many of her clients get loan modifications when the lender may have otherwise cast a blind eye. However she says, “it is still too early to judge the overall success rate of the modifications because all of my clients who have received help from HAMP are still in the trail period”.
For more specifics on HAMP, including information on whether you are eligible to participate, click here.
Thursday, December 10, 2009
Holiday Green Tips
By: Salina Greene, Outreach Coordinator, NHS of Baltimore
Gov. Martin O’Malley wants everyone to join together during this holiday season by embracing a greener lifestyle. This is part of a state-wide effort to create healthier environments for the citizens of Maryland. Although it will take time and a concerted effort by all, here are a few tips the Governor and the State Department of Natural Resources(DNR)decided to share with the Baltimore community:
1. Trying to save money on your electric bill? The use of energy lights and timers, which use 90% less energy than conventional lights, can save you up to $50 a month on your energy bill.
2. Buying local. This not only supports your local farmers and businesses, it supports the environment by decreasing the amount of carbon and shipping emissions. Click here to view specials offered in Main Street communities in Maryland.
3. Wise travel. Taking public transportation or carpooling saves on transportation emissions. Sitting in traffic decreases your fuel efficiency by as much as 33 percent. Try to avoid congestion if at all possible. Try leaving for your destination at off-peak times. For example, after 8 p.m. or early morning hours before 6 a.m. Pack as light as possible. This will also save you on luggage fees.
4. Reduce your holiday waste. This time of year averages a 25% increase in waste products.The use of less and/or recycled packaging such as reusable fabric and old newspapers saves on waste.
5. Recycle your Christmas tree. Don't put it into the landfill. Most local governments have tree recycling programs. Click here to learn about recycling services available in Baltimore. Lastly, when you cut a tree, please plant a tree.
These are just a few helpful tips to help consumers on their way to becoming a greener, cleaner community.
Gov. Martin O’Malley wants everyone to join together during this holiday season by embracing a greener lifestyle. This is part of a state-wide effort to create healthier environments for the citizens of Maryland. Although it will take time and a concerted effort by all, here are a few tips the Governor and the State Department of Natural Resources(DNR)decided to share with the Baltimore community:
1. Trying to save money on your electric bill? The use of energy lights and timers, which use 90% less energy than conventional lights, can save you up to $50 a month on your energy bill.
2. Buying local. This not only supports your local farmers and businesses, it supports the environment by decreasing the amount of carbon and shipping emissions. Click here to view specials offered in Main Street communities in Maryland.
3. Wise travel. Taking public transportation or carpooling saves on transportation emissions. Sitting in traffic decreases your fuel efficiency by as much as 33 percent. Try to avoid congestion if at all possible. Try leaving for your destination at off-peak times. For example, after 8 p.m. or early morning hours before 6 a.m. Pack as light as possible. This will also save you on luggage fees.
4. Reduce your holiday waste. This time of year averages a 25% increase in waste products.The use of less and/or recycled packaging such as reusable fabric and old newspapers saves on waste.
5. Recycle your Christmas tree. Don't put it into the landfill. Most local governments have tree recycling programs. Click here to learn about recycling services available in Baltimore. Lastly, when you cut a tree, please plant a tree.
These are just a few helpful tips to help consumers on their way to becoming a greener, cleaner community.
Tuesday, December 8, 2009
Banks Tighten Fists on Personal Lending: loans still hard to get
By: Ellen Frick, Outreach Coordinator, NHS of Baltimore
The current economic climate has everyone wary of financial loans. Risky lending practices that enhanced the mortgage crisis have hurt lenders, borrowers, and the economy as a whole. Consequently, many lenders are changing their loan policies, especially concerning unsecured personal loans to individuals with a poor credit rating. An unsecured, or signature loan as it is also known, is one that is not backed by collateral. Often this means higher interest rates as well.
One financial institution that has changed their lending policies in the wake of today’s economy is Bank of America. As of October 31, 2009 Bank of America is no longer offering personal loans. Other large banks such as Wells Fargo and CitiBank continue to offer personal loans, however Subprime Blogger anticipates that other banks may follow in the footsteps of Bank of America. Other places to look for loans are smaller regional banks and credit unions.
As Bank of America has shown, many lenders are less willing to lend money to individuals with bad credit. Minimum credit score limits to get a loan have been on the rise and a lower credit score will likely mean higher interest rates on any loan. Thus it is increasingly important to keep your credit and other financials in shape. One way to improve your credit is to make small purchases using a credit card and pay them back right away.
Research other ways to raise your credit score and consider consolidating your debt to lower interest rates. NHS of Baltimore offers financial fitness classes free of charge, which discuss the importance of building your financial stability and offer advice on how to do so. And as always, NHS of Baltimore's counselors are available to answer any of your questions.
The current economic climate has everyone wary of financial loans. Risky lending practices that enhanced the mortgage crisis have hurt lenders, borrowers, and the economy as a whole. Consequently, many lenders are changing their loan policies, especially concerning unsecured personal loans to individuals with a poor credit rating. An unsecured, or signature loan as it is also known, is one that is not backed by collateral. Often this means higher interest rates as well.
One financial institution that has changed their lending policies in the wake of today’s economy is Bank of America. As of October 31, 2009 Bank of America is no longer offering personal loans. Other large banks such as Wells Fargo and CitiBank continue to offer personal loans, however Subprime Blogger anticipates that other banks may follow in the footsteps of Bank of America. Other places to look for loans are smaller regional banks and credit unions.
As Bank of America has shown, many lenders are less willing to lend money to individuals with bad credit. Minimum credit score limits to get a loan have been on the rise and a lower credit score will likely mean higher interest rates on any loan. Thus it is increasingly important to keep your credit and other financials in shape. One way to improve your credit is to make small purchases using a credit card and pay them back right away.
Research other ways to raise your credit score and consider consolidating your debt to lower interest rates. NHS of Baltimore offers financial fitness classes free of charge, which discuss the importance of building your financial stability and offer advice on how to do so. And as always, NHS of Baltimore's counselors are available to answer any of your questions.
Thursday, December 3, 2009
BGE Customers to Receive $100 Credit in February
By: Salina Greene, Outreach Coordinator, NHS of Baltimore
Chilling winds, freezing rain, single digit temperatures- we are all familiar with they place on our heating bills during the winter months. Families struggle every year to find a way to lower their consistently higher utility costs, which most commonly peak in the month of February. Baltimore Gas and Electric (BGE) has decided to deliver a post-holiday gift to their customers- a $100 credit on their February bills!
You may ask, too good to be true? It turns out this credit is part of several conditions imposed by the State of Maryland and energy regulators. BGE’s parent company, Constellation Energy Group has recently been approved for a joint merger with Electricite de France (EDF), which closed its doors last month. After a status hearing earlier this week with the Maryland Public Service Commission, BGE mapped out all of their precautionary measures to protect their business in case the parent company runs into financial troubles. All residential customers as well as customers who have switched to another supplier are eligible for the credit. This credit is in response to increasingly higher bills paid by so many Marylanders.
Under the new long-term contracts, customers should be seeing a decrease in their bills in the coming months; as natural gas and electricity prices are dropping globally. BGE gas bills are expected to decrease by as much as 25% this winter. Electric bills should drop by as much as 15% by 2012 and the decline is expected to continue. Constellation’s merger with EDF will create a pool of $36 million for Constellation’s foundation, to help pay for the creation of a visitor’s center, and the EDF’s relocation to Maryland. The long-term fate of the various new projects from this merger is dependent upon the federal loan guarantee from the U.S. Department of Energy (DOE). This will be decided next year.
Chilling winds, freezing rain, single digit temperatures- we are all familiar with they place on our heating bills during the winter months. Families struggle every year to find a way to lower their consistently higher utility costs, which most commonly peak in the month of February. Baltimore Gas and Electric (BGE) has decided to deliver a post-holiday gift to their customers- a $100 credit on their February bills!
You may ask, too good to be true? It turns out this credit is part of several conditions imposed by the State of Maryland and energy regulators. BGE’s parent company, Constellation Energy Group has recently been approved for a joint merger with Electricite de France (EDF), which closed its doors last month. After a status hearing earlier this week with the Maryland Public Service Commission, BGE mapped out all of their precautionary measures to protect their business in case the parent company runs into financial troubles. All residential customers as well as customers who have switched to another supplier are eligible for the credit. This credit is in response to increasingly higher bills paid by so many Marylanders.
Under the new long-term contracts, customers should be seeing a decrease in their bills in the coming months; as natural gas and electricity prices are dropping globally. BGE gas bills are expected to decrease by as much as 25% this winter. Electric bills should drop by as much as 15% by 2012 and the decline is expected to continue. Constellation’s merger with EDF will create a pool of $36 million for Constellation’s foundation, to help pay for the creation of a visitor’s center, and the EDF’s relocation to Maryland. The long-term fate of the various new projects from this merger is dependent upon the federal loan guarantee from the U.S. Department of Energy (DOE). This will be decided next year.
Wednesday, November 25, 2009
Credit Repair Scams are on the Rise
By: Salina Greene, Outreach Coordinator, NHS of Baltimore
As the economic recession continues, more people are looking into better options to reduce their expenses, and repair their credit. Unknowingly, consumers are becoming victims of several scams plaguing our city. Two of the most popular include: Credit repair and Bankruptcy advice programs. The number of illegal companies promising help with these issues is on the rise. Their main advertisement tools are signs posted on utility poles, lawns, and vacant houses; perhaps to target people in deteriorating neighborhoods.
An attorney for The Community Law Center (CLC) pulled an ad from a pole showing how prevalent these scams are around the city. An intern at his office researched the phone number and company listed on the ad. It was traced to a real-estate agent with major credit problems. When phone inquiries were made, all they ever got was a voicemail message. Apparently, the resident agent listed was the head agent’s sister; with legal problems of her own. He swore she had nothing to do with the company. Ironically, when questioned about his staff, he stated he had two partners and a silent partner. He only volunteered to identify the two partners by last name.
It is illegal nationwide for any non-lawyer to give legal advice and/or handle money client under the guise of legal council; up-front fees for credit repair is also illegal. Although they can charge fees for preparing petitions, this fee can only amount to the equivalent of the cost of a typist. The real-estate agent talked about above claims he provides his services as a way to serve the community. He agreed to meet a representative from CLC, but subsequently changed his mind and offered a follow-up call instead.
When looking for any credit repair or debt management program, please make sure you research the company thoroughly before you decide to commit to services. Scammers are on the rise. Don't be a victim.
As the economic recession continues, more people are looking into better options to reduce their expenses, and repair their credit. Unknowingly, consumers are becoming victims of several scams plaguing our city. Two of the most popular include: Credit repair and Bankruptcy advice programs. The number of illegal companies promising help with these issues is on the rise. Their main advertisement tools are signs posted on utility poles, lawns, and vacant houses; perhaps to target people in deteriorating neighborhoods.
An attorney for The Community Law Center (CLC) pulled an ad from a pole showing how prevalent these scams are around the city. An intern at his office researched the phone number and company listed on the ad. It was traced to a real-estate agent with major credit problems. When phone inquiries were made, all they ever got was a voicemail message. Apparently, the resident agent listed was the head agent’s sister; with legal problems of her own. He swore she had nothing to do with the company. Ironically, when questioned about his staff, he stated he had two partners and a silent partner. He only volunteered to identify the two partners by last name.
It is illegal nationwide for any non-lawyer to give legal advice and/or handle money client under the guise of legal council; up-front fees for credit repair is also illegal. Although they can charge fees for preparing petitions, this fee can only amount to the equivalent of the cost of a typist. The real-estate agent talked about above claims he provides his services as a way to serve the community. He agreed to meet a representative from CLC, but subsequently changed his mind and offered a follow-up call instead.
When looking for any credit repair or debt management program, please make sure you research the company thoroughly before you decide to commit to services. Scammers are on the rise. Don't be a victim.
Monday, November 23, 2009
Make Saving a Priority During the Holidays
By: Ellen Frick, Outreach Coordinator, NHS of Baltimore
These days most people are feeling the pinch of the ongoing economic crisis. Debt from buying a home, going to school, or major credit card purchases are quite commonplace in America. In fact, our “debt economy” actually encourages people to borrow money and live in debt.
But all this debt can be even more intimidating when savings accounts dwindle, which is what is happening among the majority of Americans. A recent study documented on National Public Radio(NPR) found a large percentage of Americans are unable to come up with extra funds in case of emergencies, even if they were to ask relatives for help. In the challenging economic climate that we are living in today, saving money can be one of the most difficult but also one of the most important things we can do.
It is frustrating to think about putting away money into a savings account when many of us are just struggling to get by. Yet, problems such as car troubles or an unexpected sickness can cause serious financial issues, especially with no extra money to fall back on. Start out small and try to save a few dollars each week. Maybe sacrifice eating out or buying a coffee. Try walking to the store or work instead of driving.
The Baltimore Sun’s Consuming Interests blog is a good resource that gives the lowdown financial deals. A recent post noted hidden ways (http://weblogs.baltimoresun.com/business/consuminginterests/blog/2009/11/top_10_hidden_deals_10spot.html) to save money in Baltimore. For more information on ways to save here are 100 tips to saving. Check out The Simple Dollar for even more tips on how to stretch your budget and save money.
While saving money strategies can really be beneficial, don’t buy something just because it is on sale. Get the deals you need but don’t make purchaces that you really don’t need simply because you can get a deal. And be careful on Black Friday! Make a budget, include money for savings, and stick to it.
These days most people are feeling the pinch of the ongoing economic crisis. Debt from buying a home, going to school, or major credit card purchases are quite commonplace in America. In fact, our “debt economy” actually encourages people to borrow money and live in debt.
But all this debt can be even more intimidating when savings accounts dwindle, which is what is happening among the majority of Americans. A recent study documented on National Public Radio(NPR) found a large percentage of Americans are unable to come up with extra funds in case of emergencies, even if they were to ask relatives for help. In the challenging economic climate that we are living in today, saving money can be one of the most difficult but also one of the most important things we can do.
It is frustrating to think about putting away money into a savings account when many of us are just struggling to get by. Yet, problems such as car troubles or an unexpected sickness can cause serious financial issues, especially with no extra money to fall back on. Start out small and try to save a few dollars each week. Maybe sacrifice eating out or buying a coffee. Try walking to the store or work instead of driving.
The Baltimore Sun’s Consuming Interests blog is a good resource that gives the lowdown financial deals. A recent post noted hidden ways (http://weblogs.baltimoresun.com/business/consuminginterests/blog/2009/11/top_10_hidden_deals_10spot.html) to save money in Baltimore. For more information on ways to save here are 100 tips to saving. Check out The Simple Dollar for even more tips on how to stretch your budget and save money.
While saving money strategies can really be beneficial, don’t buy something just because it is on sale. Get the deals you need but don’t make purchaces that you really don’t need simply because you can get a deal. And be careful on Black Friday! Make a budget, include money for savings, and stick to it.
Thursday, November 19, 2009
New Federal Incentives for Home Rehabs
By: Salina Greene, Outreach Coordinator, NHS of Baltimore
The sheer number of available renovation-ready rowhomes is skyrocketing in Baltimore. This is in response to the growing number of foreclosures, bank-owned and distressed properties. The government offers a loan program, with an excellent interest rate, for people interested in investing in a large home renovation project. It is called the Federal Housing Administration’s (FHA) Section 203(k) program. Homebuyers are only required to contribute a 3.5% down payment.
The added incentive is a single mortgage is combined with renovation costs. This simplification process is attractive to first-time homebuyers, as well as investors. In the wake of the recession, it is easier to purchase a rehab home at a cheaper rate, then to purchase a brand new and/or custom-built home. Many could not afford to purchase a home if it was not for this program, and the $8,000 tax credit.
Realtors are providing their clients with all the information they can about the program. They are trying to get them pre-qualified as there is a rise in short-sell properties. A number of short-sells require moderate to major repairs. Most of the time, the sellers are unwilling to invest money in the repairs. With the deteriorating condition of vacant homes on the rise in Baltimore, the 203(k) program is getting a lot more attention.
Another similar program is the 203(k) streamlined program. This allows the borrower to add up to $35,000 in renovation costs to their current mortgages. The standard program does not have a loan amount limit. The general requirement for both programs is the overseeing of all the renovation work by a HUD-approved consultant. They are responsible for giving you an estimated cost of repairs needed. Health and safety issues are also their highest priority. Make sure you pick a reputable home contractor for your repairs, to maximize your expenditures.
The sheer number of available renovation-ready rowhomes is skyrocketing in Baltimore. This is in response to the growing number of foreclosures, bank-owned and distressed properties. The government offers a loan program, with an excellent interest rate, for people interested in investing in a large home renovation project. It is called the Federal Housing Administration’s (FHA) Section 203(k) program. Homebuyers are only required to contribute a 3.5% down payment.
The added incentive is a single mortgage is combined with renovation costs. This simplification process is attractive to first-time homebuyers, as well as investors. In the wake of the recession, it is easier to purchase a rehab home at a cheaper rate, then to purchase a brand new and/or custom-built home. Many could not afford to purchase a home if it was not for this program, and the $8,000 tax credit.
Realtors are providing their clients with all the information they can about the program. They are trying to get them pre-qualified as there is a rise in short-sell properties. A number of short-sells require moderate to major repairs. Most of the time, the sellers are unwilling to invest money in the repairs. With the deteriorating condition of vacant homes on the rise in Baltimore, the 203(k) program is getting a lot more attention.
Another similar program is the 203(k) streamlined program. This allows the borrower to add up to $35,000 in renovation costs to their current mortgages. The standard program does not have a loan amount limit. The general requirement for both programs is the overseeing of all the renovation work by a HUD-approved consultant. They are responsible for giving you an estimated cost of repairs needed. Health and safety issues are also their highest priority. Make sure you pick a reputable home contractor for your repairs, to maximize your expenditures.
Wednesday, November 18, 2009
As Anne Frank Once Put it, "No One Has Ever Become Poor By Giving"
By: Jessica Schmidt-Bonifant, Philanthropy Manager, NHS of Baltimore
“Think of giving not as a duty but as a privilege." That's how John Rockefeller viewed giving, and it certainty rings true in these challenging times. Many of us have felt the effects of the economy first hand whether our paychecks have been reduced, our investments depleted, or our home values decreased. We all have less and less disposable income to take care of the many needs piling up on our plates- especially this time of year when we have gifts to buy, food to make and traveling to do, on top of the appeal letters that arrive at our doorsteps. It is easy just to add the letter to the stack of recycling in the corner and think “Not this year, there is just too much”.
It is easy just to shove off the request and move on with our day, but as Mr. Rockefeller said giving is a privilege. Not everyone has the ability or capacity to make a donation, but if you do think about how lucky you are. You have the unique opportunity to make a difference; you have the chance to change someone’s life by making a contribution no matter how big or small. Obviously we aren’t all the Rockefellers, we can’t make million dollar pledges for organizations to build new offices or start new clinics, but our gifts still matter and that is important to remember.
Nonprofits cannot run on the desire to help people alone. We have all the right pieces, we have the dedicated staff, and we have the desire to work to change lives, but at the end of the day we need to keep the lights on, we need to call our clients and that is where your contribution matters. Whether you give directly to a program or to an annual fund your gift matters it lets us do our job and it lets us help those in need.
So in these challenging times take a moment to remember that if you are able to make a contribution you are lucky, you can change people’s lives for the better and at the end of the day what better gift is there then that. Click here to donate.
“Think of giving not as a duty but as a privilege." That's how John Rockefeller viewed giving, and it certainty rings true in these challenging times. Many of us have felt the effects of the economy first hand whether our paychecks have been reduced, our investments depleted, or our home values decreased. We all have less and less disposable income to take care of the many needs piling up on our plates- especially this time of year when we have gifts to buy, food to make and traveling to do, on top of the appeal letters that arrive at our doorsteps. It is easy just to add the letter to the stack of recycling in the corner and think “Not this year, there is just too much”.
It is easy just to shove off the request and move on with our day, but as Mr. Rockefeller said giving is a privilege. Not everyone has the ability or capacity to make a donation, but if you do think about how lucky you are. You have the unique opportunity to make a difference; you have the chance to change someone’s life by making a contribution no matter how big or small. Obviously we aren’t all the Rockefellers, we can’t make million dollar pledges for organizations to build new offices or start new clinics, but our gifts still matter and that is important to remember.
Nonprofits cannot run on the desire to help people alone. We have all the right pieces, we have the dedicated staff, and we have the desire to work to change lives, but at the end of the day we need to keep the lights on, we need to call our clients and that is where your contribution matters. Whether you give directly to a program or to an annual fund your gift matters it lets us do our job and it lets us help those in need.
So in these challenging times take a moment to remember that if you are able to make a contribution you are lucky, you can change people’s lives for the better and at the end of the day what better gift is there then that. Click here to donate.
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