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Exceptional Views!!
• 1,900 sq. ft., 2 bath, 3 bdrm 2 story "Raised Beach Style" -  MLS® $849,000 USD - On the Inlet w Fltng dock Jordan Landing, Murrells Inlet - Beautiful home located in the heart of the historic fishing village of Murrells Inlet on the water with incredible views. This raised beach has views you just dream of. Carolina room overlooks the inlet and you can sit on your screen porch and enjoy the view as well as the wonderful ocean breezes. This home features hardwood and tiled floors throughout. You can fish from your own private dock or anchor your boat. Lots of parking and a large workshop or storage underneath. New roof in 2007
Room Sizes:
Great-Family Room: 12x25 Dining Room: 12x16 Kitchen: 12x16
Master Bedroom10x15 Other Bedrooms 1: 10x15 Other Bedrooms 2: 10x15 Property information Another one of a kind property exclusively listed by the area's Real Estate Experts, Jake Lee and Ann McKinnon. If you are in the market to sell your home or investment property be sure to give Ann 843-907-6899 or Jake 843-240-0431 a call !! You can also visit them on the web to see some of their state-of-the-art marketing techniques or just browse your favorite listings! www.SCRealEstatePartners.com
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Homewood, Conway - Announcing a price reduction on 2817 belk road, a 1,300 sq. ft., 2 bath, 3 bdrm single story. Now MLS® $79,900 USD - Country Living!! No HOA. Property information A price that can not be beat on this secluded country property complete with work shed in Conway, SC. Bring us an offer! for other properties and exclusive buyer representation at no cost to you, call Jake Lee 843-240-0431 ! If you are interested in having your property SOLD call Ann McKinnon 843-907-6899 Visit www.SCRealEstatePartners.com to browse more homes for sale in Conway, SC or surrounding areas including Myrtle Beach, Pawleys Island, and MORE!!
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Debordieu Colony, Georgetown - Announcing a price reduction on 267 Pinckney Road, a 4,500 sq. ft., 4 bath, 5 bdrm 3 story "2 storys of living space". Now MLS® $599,900 USD - Debordieu Colony -REDUCED. Property information WOW, IS THE ONLY WORD THAT COMES TO MIND WHEN YOU SEE A PRICE TAGE ON A HOUSE OF THIS NATURE AND SIZE IN DEBORDIEU COLONY! Make us an offer, this home is a must see and a must sell!! Call Jake Lee at 843-240-0431 and visit our website www.SCRealEstatePartners.com to see the latest and greatest mls listings, foreclosures, short sales, and more!! Also you can view www.Debordeiu.com for a list of what's for sale in this exclusive community and what has sold in the last 6 months!! Thanks for taking the time to look! Jake Lee
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Below is a list of APPROVED condominium projects that Wells Fargo Home Mortgage has recently been able to have reclassified. Lenders are now doing conventional financing up to 90% on second homes, in the following; Shoreham Towers II The Beach Club II Cumberland Terrace Gloucester Pointe Richmond Park St. James Park Westhyde Park Windemere by the Sea Harbour Cove Heron Bay Malibu Pointe Emerald Cove II Water Pointe II Windy Hill Dunes Canterbury Court Cypress Bend Savannah Shores North Beach Plantation If there is a specific property you would like to know about, and don’t see on the list, please let me know and I verify with my preferred lender. If you are interested in buying or selling a condo in Myrtle Beach, SC or surrounding areas, please give me a call at 843-240-0431 or visit me on the web at www.SCRealEstatePartners.com where you can find a free foreclosure list, short sale list, info and videos about the different towns around Myrtle Beach, SC like Pawleys Island, Murrells Inlet, and Surfside Beach!! You will also find mortgage tools that will help you see what you can afford, Submit an offer on your favorite property online, search the mls, and MUCH MUCH MORE! Thanks! Jake Lee Local Realtor for Myrtle Beach and surrounding towns.
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Economic Commentary
Despite warnings from everywhere that the recovery would be full of "stops and starts," the employment report from November and preliminary positive Holiday sales reports had the markets getting ahead of themselves before the December jobs report was released. We are not only talking about the stock market. Bonds had fallen significantly in December, the dollar was rallying and oil prices were marching upward. Economic Commentary These are all indicative of a strong recovery and many were expecting a positive employment report for December. Well, 85,000 jobs lost in December shows that we are not out of the woods yet. The Federal Reserve Board and most economists keep saying that, while things are looking better, the world will not turn rosy for some time. The case of oil prices is one exception. We have had frigid temperatures in many parts of the nation since late December and this has given energy prices a substantive reason for increases on the upside. Not only is this a temporary factor, but higher energy prices such as $3.00 per gallon at a pump can actually slow the economy down as consumers curb spending on other purchases. It is expected that increased energy consumption by buildings will actually give a boost to economic growth in the short run, but once again that is temporary. Expect the sobering but not surprising employment report to spur more stimulus activity such as the "cash for cau! lkers" program as well as more support from the Fed with regard to keeping long-term rates down through purchases on Treasuries and mortgage-backed-securities on the open market. At least until the jobs picture turns positive permanently.
U.S. Households Increase Even In Recession Of the more than 113 million occupied homes covered in the US Census Bureaus 2008 American Community Survey, 15.6% have more than $2,000 in monthly housing costs. The survey provides a statistical snapshot of the characteristics of the US population in 2008, including the finances of housing consumers. The data collected by Census Bureau officials determines where more than $400 billion goes to state and local governments each year. The Census surveyed roughly 250,000 addresses for the foundation of the data. The total number of family households increased from 2007 by approximately 72,000 units, according to the survey. California homeowners had the highest monthly median housing costs in the country at $2,384. New Jersey narrowly trailed with $2,360. Hawaii, with $2,265, and the District of Columbia, at $2,218, followed. California led all states with 53.3% of the states home owners spending 30% of their households monthly income on housing costs. Hawaii came in second ! with 49.3% and Florida was third with 49.1%. Minnesota led the nation with 74.7% of its occupied housing units that are owner-occupied. Michigan and West Virginia rounded out the top three with 74% and 73.7%, respectively. At the bottom was the District of Columbia with 43.4%, New York with 53.3% and California with 57%. Source: HousingWire
Short Sales Becoming Easier While obstacles to short sales remain, real estate practitioners say the process is becoming more efficient. Rather than waiting six months or more to push through a deal, agents say banks are more willing to negotiate prices up front. "My gut feeling is that short sales seem to be the preferred avenue for distressed property now," says Cindi Hagley of San Ramon, Calif.-based Windermere Welcome Home. "Its cheaper for [banks] to do a short sale than go all the way to foreclosure." The short-sale process has become more manageable now that banks are willing to pre-approve prices, reach out to underwater borrowers who have listed their homes for sale, implement Web-based systems that manage the short sale process, and add staff dedicated to short sales. Additionally, the U.S. Treasury is set to implement a streamlined short sales framework and offer incentive payments of $1,500 to home owners and $1,000 to both loan servicers and second-lien holders. Borrowers also prefer shor! t sales because Fannie Mae requires them to wait only two years to own another home or even less than that if they were not delinquent. By contrast, those who lost their homes to foreclosure have to wait five years. Source: San Francisco Chronicle
Green Homes Advance During Tough TimesDespite this being a tough year for home builders, more than 75,000 new homes were designated Energy Star green properties in 2009. These energy efficient properties accounted for nearly 17 percent of all new single-family homes, up from 12 percent in 2007. "Consumer acceptance has been outstanding," says Walter Cuculic of Pulte Homes, which has built 120,000 Energy Star homes. Owners of existing homes also are spending money on things that make their homes more energy efficient. A survey by USA Today showed that 68 percent of those surveyed spent money this year on energy renovations 68 percent to save money and 26 percent to save the environment. Source: USA Today
More growth and expansion next year, experts say Home remodeling business is picking up all over the country. Contractors began noticing the trend at the end of what was a long, slow summer. The reason for the upturn is that home owners, unable to sell properties, are deciding to stay and fix up the deficiencies. An added incentive is the $1,500 federal tax credit for energy-related improvements. The National Association of Home Builders Remodeling Market Index, a measure of contractor confidence, rose slightly last month and its futures index also increased, indicating contractors are more confident that business is improving. Kermit Baker, chief economist for the American Institute of Architects and Senior Research Fellow at Harvard Universitys Joint Center for Housing Studies, agrees that the remodeling industry hit bottom during the summer, but he doesnt expect substantial improvement until Spring 2010. Source: CNN/Money.com
New and Existing Home Inventory Down The inventory of completed but unsold new houses fell to 239,000 at the end of October, according to the National Association of Home Builders. Thats the fewest since May 1971, when the inventory stood at 236,000. The months supply that is, the amount of time it would take to sell the current inventory at Octobers sales rate fell to 6.7 months, which the NAHB says is "respectable." The historic high was set in January, when the supply topped out at 12.4 months. Meanwhile, the inventory of unsold existing houses fell in October to 3 million, and the months supply dipped to 6.8 months. The supply of resale houses hit its cyclical peak in June 2008, when it reached 11 months. Source: National Mortgage News With regard to existing homes, the number of homes for sale declined 2.4 percent in November in the metropolitan areas covered by ZipRealty Inc. In the last 25 years, the decline in November has averaged 1.8 percent. The data doesnt include New York, but Miller Samue! l Inc., an appraisal firm, reports that inventory was down 7.1 percent from the end of October and down 18 percent compared to November 2008. October was the first month since January to show a rise in bank-owned homes. The number of bank-owned properties declined over the summer because of efforts to prevent foreclosures. As time runs out for many families, the number of foreclosures is increasing. As of the end of October, banks and home-loan investors had 639,000 foreclosed homes for sale across the U.S., Barclays Capital estimates. Source: National Mortgage News and The Wall Street Journal
Cash For Caulkers Proposed President Obama proposed a program that would reimburse home owners for installing energy-efficient appliances, windows, and insulation. Under what has been dubbed Cash for Caulking, home owners would get a 50 percent rebate on items like energy-efficient air conditioners, heating systems, washing machines and dryers, refrigerators, replacement windows, and insulation up to $12,000, meaning a household could spend $24,000 and get $12,000 back. There will likely be no income restrictions. Steve Nadel, director at the American Council for an Energy-Efficient Economy, who is helping to craft the legislation, says they are contemplating having contractors or retailers pay part of the cost upfront to ease the need for home owners to come up with lots of cash. Source: CNNMoney.com
IRS Clarified Homebuyer Tax Credit Eligibility The IRS has spelled out guidelines for eligibility for the home buyer credit when co-borrowers purchase a property. When a home-owning parent of an adult child co-signs for a home loan and both names appear on the note, the IRS says that under some circumstances, the first-time home buyer can qualify for the whole amount. The IRS says the parent doesnt qualify for any portion of the credit, but if the child hasnt owned a home during the three years preceding the current purchase and can qualify based on income, he or she can be allocated the entire $8,000 credit. When unmarried individuals co-purchase a home and only one of them is eligible for the credit, then the full $8,000 can be allocated to the eligible buyer. Source: Washington Post Writers Group If you are interested in buying or selling real estate in the near future in the Myrtle Beach area of South Carolina or surrounding coastal towns, please visit us online at www.SCRealEstatePartners.com for a free foreclosure list, free short sale list, search the MLS, make an offer online, and much much more! You can also contact Jake Lee 843-240-0431 or his business partner Ann McKinnon 843-907-6899 to get started today!! Remember, as a buyer our representation is at no cost to you!
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FHA Changes – They are a comin’
After much discussion and speculation, HUD has officially announced some significant changes to the FHA program this morning in an effort to address credit risk concerns and shore up FHA’s loan loss reserves. A summary of proposed FHA policy changes and timelines for implementation are: · Increasing Mortgage Insurance Premiums - The first step will be to raise the up-front MIP by 50 bps to 2.25% and request legislative authority to increase the maximum annual MIP that the FHA can charge.
- If this authority is granted, then the second step will be to shift some of the premium increase from the up-front MIP to the annual MIP.
- The initial up-front increase is included in a Mortgagee Letter to be released tomorrow, January 21st, and will go into effect in the spring.
- Update the combination of FICO scores and down payments for new borrowers.
- New borrowers will now be required to have a minimum FICO score of 580 to qualify for FHA's 3.5% down payment program. New borrowers with less than a 580 FICO score will be required to put down at least 10%. (our investor overlays of a minimum 620 score already apply)
- This change will be posted in the Federal Register in February and, after a notice and comment period, would go into effect in the early summer.
- Reduce allowable seller concessions from 6% to 3%
- This change will be posted in the Federal Register in February, and after a notice and comment period, would go into effect in the early summer.
- Increase enforcement on FHA lenders
- Publicly report lender performance rankings to complement currently available Neighborhood Watch data - Will be available on the HUD website on February 1.
- Enhance monitoring of lender performance and compliance with FHA guidelines and standards.
- Implement Credit Watch termination through lender underwriting ID in addition to originating ID.
- This change is included in a Mortgagee Letter to be released tomorrow, January 21st, and is effective immediately.
- Implement statutory authority through regulation of section 256 of the National Housing Act to enforce indemnification provisions for lenders using delegated insuring process
- Specifications of this change will be posted in March, and after a notice and comment period, would go into effect in early summer.
If you have any questions please contact Myrtle Beach, SC's Top Real Estate Team Jake Lee 843-240-0431 or Ann McKinnon 843-902-6899 for more details! You can also visit them on the web at www.SCRealEstatePartners.com where you can find a free foreclosure list for Myrtle Beach Real Estate, Pawleys Island Homes for Sale, Surfside Beach Short Sales, AND MORE!! When you're sick, you choose the BEST doctor? When you need legal assistance, you choose the best attorney? When you need to buy or sell Real Estate in South Carolina, choose the best Realtor around.. Jake Lee!
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Now is your chance to purchase a home or land in the MUCH desired community of Debordieu Colony for as low as $169,000 for a lot or as low as $590,000 !!! Debordieu Colony is truely a prestigous, world class residential resort community developed in the 70s with 2,700 acres of absolute beauty and awe inspiring views of the oceans and salt marshes. The word Debordieu is derived from the French language meaning "Gateway to Heaven", and boy does Debordieu Colony live up to it's name. Among some of Debordieu's past homeowners are such names as Mike Fox formally a defensive end with the Carolina Panthers, Actor Michael J. Fox, and several other well known and enfluencial individuals. Debordieu Colony is located just north of the Winyah Bay in Georgetown, SC and only a few miles south of Pawleys Island. Among some of the amenities within the gates of Debordieu Colony include a Private, Members only 18 Hole Pete Dye Designed Golf Course, Private Clay and Hard Surface Tennis Courts, PRIVATE BEACH, Private beach front pools, Private oceanfront Restaurant, 2 clubhouses, 24hr Gated Security and Patrol, FREE Boat Storage for Homeowners, Private boat ramp into the North Inlet, and more for homeowners of Debordieu Colony to enjoy. Debordieu also houses it's own fire department (maintained by the state)! Below I have listed some of the most recent sales in Debordieu Colony for COMP purposes for your new home or land purchase in Debordieu Colony. Feel Free to visit www.Debordeiu.com to see a list of Home and Land actively for sale in the community. Also, I have included the listings of the most recent solds. As always, you can contact me at any time via phone ( 843-240-0431 ) or email ( JakeLee@kw.com ) with any questions, to schedule a showing, start your new home search, or even make an offer! As a previous long time resident of Debordieu Colony I can certainly say that this is one of the finest communities in the area! 15 Trade Wind Court - UNDER CONTRACT - CASH SALE to close end of Feb/2010 - Raised Beach Style Home with ocean views featuring 6 Bedrooms 6.5 Baths and approximently 5000 heated sqft of living space. Listed at $1,725,000 (Price buyer paid cannot be released until closing of property). This property was a foreclosure listing. LOT 14 Ocean Park Loop - UNDER CONTRACT _ CASH SALE - This lot features ocean views and is less than .5 of an acre. Listed at $750,000 (Price buyer paid cannot be released until after closing of this property). 887 Lantana Circle - UNDER CONTRACT - CASH SALE - ALL BRICK 4 bedroom 4.5 bath featuring approximently 4,000 sqft of heated living space on the lake. Listed at $795,000 (price buyer paid cannot be released until after the closing of this property). LOT 85 Lantana Circle - SOLD for $324,000 on 10/14/2009 - 1/2 acre Wooded lot that has already been bush-hogged featuring water on 2 sides LOT 10 Colony Point Drive - SOLD for $950,000 on 10/16/2009 - on the creek 20 Aerie Court - SOLD for $770,000 on 9/2/2009 - 5 bedroom , 4.5 bath featuring 3950 heated sqft of living space LOT 9 Collins Meadow Drive - SOLD for $285,000 on 12/4/2009 - Lot is on the golf course featuring beautiful views and over is 1/2 acre 84 Shearwater Court - SOLD for $950,000 on 10/1/2009 - 3 bed ,3.5 bath home featuring 3300 heated sqft of living space lot 5 Dune Oaks - SOLD for $1,390,000 on 12/30/2009 - 4bed, 3.5 bath home featuring 4500 heated square feet of living space, over one acre lot, and on the creek with a floating dock in place 686 Wallace Pate Drive - SOLD for $675,000 on 11/12/2009 - 4 bed, 4.5 bath home featuring 2800 heated sqft of living space on the golf course 710 Wallace Pate - SOLD for $580,000 on 7/7/2009 - 6 bedrooms, 4 full baths, and 2 half baths featuring almost 3700 heated sqft of living space LOT 10 Luvan Blvd - SOLD for $925,00 on 10/26/2009 - Deep water creek lot with 130 ft of water frontage. Landscaped with bulk head in place. Ready to build. 589 Lantana Circle - SOLD for $475,000 on 9/15/2009 - 4 bedrooms, 3 full baths, Low Country Style Home featuring almost 2900 heated sqft of living space 690 Lantana Circle - SOLD for $700,000 on 9/21/2009 - 5 bedrooms, 6.5 baths , featuring 4,000 heated sqft feet of living space on a large lake 177 Ocean Green - SOLD for $1,675,000 on 6/5/2009 - 4 bedrooms, 4.5 baths, featuring outsanding oceans views and 4500 heated sqft of living space Again, to view the actively for sale real estate in Debordieu Colony of Georgetown, SC, please go to www.Debordeiu.com or CLICK HERE If you are interested in buying or selling real estate in the near future, but Debordieu isn't of interest to you... we have thousands of listings to browse ranging from $30,000 oceanfront condos in Myrtle Beach and North Myrtle Beach, Luxurious homes in The Grand Dunes of Myrtle Beach, Prestigous Pawleys Island and Litchfield Beach Homes, Acreage all over Georgetown and Horry County, FORECLOSURES, SHORT SALES, and much more available at our website www.SCRealEstatePartners.com If you would like exclusive no cost representation as a buyer for your next real estate purchase, please feel free to call us at any time as we are available 7 days a week to serve you! Thanks, Jake Lee 843-240-0431 Ann McKinnon 843-907-6899 Keller Williams Realty - SC Real Estate Partners
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Now is your chance to own a condo or townhouse in the much desired Belle Isle Yacht Club community of Georgetown, SC !! Belle Isle is an ammenitie filled condo and townhome community developed in the 70s filled with history and beautiful natural scenary including several hundred year old live oak trees draped with moss, Johnstone Lake, The Winyah Bay, Battery White, HUNDREDS of azelia bushes, and much MORE. The amenities you will recieve as a homeowner in The Yacht Club at Belle Isle include : 2 swimming pools, 2 clubhouses, Marina Yacht Club on the Winyah Bay (5-6 Nautical Miles to Ocean and 4 nautical miles to the ICW), Restaurant ( Marina Grill ), boat parking and wet slips are available, tennis courts, private gated community, and a Private Oceanfront Beach House in Pawleys Island! Some of the history surrounding Belle Isle includes Battery White ( Located within the Belle Isle Yacht Gates ) which is a historical confederate battle site. Battery White is a man made "earthwork" comprised of rolling terain used as a battlefield and to attack and defend against ships coming in and out of port. Battery White still houses the original cannons from the late 1800s. Visit www.BelleIsleVillas.com to view the 3 most recent SOLD listings in The Yacht Club at Belle Isle or see the listings in Belle Isle Villas currently for sale!! The 3 Most recent sales are listed below: 30 Bamboo Loop - Unit 131 SOLD 6/11/2009 for $159,900 and is a 3 bedroom 2 bath townhouse with a slight view of the bay from the front porch !! 283 Finch Drive SOLD 8/7/2009 for $185,000 and is a 2 bedroom 1 and a half bath townhouse on the Intracoastal Waterway / Winyah bay with INCREDIBLE Views 73 Finch Drive - Unit 253 SOLD 7/14/2009 and is a 3 bedroom 2 bath located on Johnstone lake featuring unobstruced views of the Winyah Bay Again, to view the actively for sale real estate in Belle Isle Villas, please go to www.BelleIsleVillas.com If you are interested in buying or selling real estate in the near future, but The Belle Isle Yacht Club isn't of interest to you... we have thousands of listings to browse ranging from $30,000 oceanfront condos in Myrtle Beach and North Myrtle Beach, Luxurious homes in The Grand Dunes of Myrtle Beach, Prestigous Pawleys Island and Litchfield Beach Homes, Acreage all over Georgetown and Horry County, FORECLOSURES, SHORT SALES, and much more available at our website www.SCRealEstatePartners.com If you would like exclusive no cost representation as a buyer for your next real estate purchase, please feel free to call us at any time! Thanks, Jake Lee 843-240-0431 Ann McKinnon 843-907-6899 Keller Williams Realty - SC Real Estate Partners
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The Glens at the International Club, Murrells Inlet - Horry County - The 2 story at 268 madrid drive has been sold. Property information Yet another exceptional property sold by the areas real estate expert, Jake Lee! Want Jake Lee to sell your home? Give us a call at 843-240-0431 ! If you are looking to purchase a property in the near future be sure to visit our website at www.SCRealEstatePartners.com for foreclosure lists, search the mls, short sale lists, videos about our areas, submit an offer online, and much more. BEST OF ALL, it's all free!!! Speaking of free, did you know that Jake Lee offers his services at no cost to his buyer clients?
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Condominium Financing Solutions
January 11, 2010
Jake Lee Realtor, CREN 843-240-0431 www.SCRealEstatePartners.com
Table of Contents
1. Introduction- Where are we and how did we get here? 2. Fannie Mae and Freddie Mac’s condo-tel guidelines 3. Currently approved projects 4. How to get a project approved 5. Famous FNMA 921 form 6. Available programs 7. FHA condo loans 8. Suggestions for improvements going forward
Introduction Where are we and how did we get here?
The condominium market in the Myrtle Beach area has gone through some dramatic changes over the last several years. We went through a feeling of almost anything goes. We are starting to bump up against a feeling of almost nothing goes. The changes have always seemed to happen gradually, but in the last month or so we have seen a very rapid shift towards much more conservative underwriting of condo loans.
The root of these changes begins with the ocean front condo market. For many years, Fannie Mae and Freddie Mac did a poor job of distinguishing between condo-tels and condominiums. They were accepting everything sent their way as a condominium. This lack of clarity and oversight gave them a portfolio of loans that was heavily weighted with condo-tels even though they technically did not accept them. When the market began to slow and foreclosures began to pop up, Fannie and Freddie began to realize that they had a problem. They gradually gave clearer guidance to lenders about the types of properties that they would or would not accept. This caused lending guidelines to get stricter, until we had the complete elimination of condo-tels qualifying for conventional financing.
If the story ended there, we would have been able to understand what types of properties we could and could not finance. In the last month or so it seems that everything has changed again. Fannie and Freddie have told lenders that they will not purchase loans on condominiums that have any of the characteristics of a condo-tel. The guideline that is causing us the most concern is advertising of rental rates. Even if daily or weekly rentals are prohibited by the condo documents, owners are still listing units on web sites with daily or weekly rentals. That alone can disqualify a condominium project from conventional financing.
Why is this happening now? We really don’t know. However, Fannie Mae is requesting another large sum of money from the government to continue operating after continuing to lose money month after month. We have also heard a rumor that they have sent employees to various resort areas on the east coast and have been very upset at what they have found. If you look at the Fannie guidelines in the next section, you will see that the location of the project in a resort area automatically puts a condominium under closer scrutiny. In other words, every condominium in our area will be looked at closer than a condominium in a non-resort area.
In the next section, I have included the guidelines as they pertain to the determination of what is a condo-tel. One of the difficulties Lenders face is in interpreting the guidelines correctly so that they are able to sell their loans to Fannie and Freddie. They have to be able to sell the loans to continue funding loans. If too many mistakes are made, they will be out of business. This goes for all lenders. What you always find is that every lender will interpret the guidelines differently. That is why lenders sometimes give different answers to the same question.
While the guidelines are not exciting reading, they are helpful in understanding where Fannie and Freddie are going. I will also be using them in the last section to highlight the direction that I feel we will all need to go in the future. Anything in red is something that I feel you should look at closely.
Identification of Condominium or Cooperative Hotels
Fannie Mae will not purchase or securitize loans that are secured by individual units in projects that are operated as a commercial hotel or motel. Fannie Mae frequently receives questions from lenders on how they can identify a condominium or cooperative hotel. The lender must perform a careful analysis of the project to determine the project’s eligibility. Lenders have several sources of information on which they can rely. These include, but are not limited to, the appraisal, the contract for sale, and the Internet. Fannie Mae considers projects with any of the following characteristics to be hotel-type projects and therefore, ineligible:
1. Central telephone system 2. Room service 3. Units that do not contain full-sized kitchen appliances 4. Daily cleaning service 5. Advertising of rental rates 6. Registration service 7. Restrictions on interior decorating 8. Franchise agreements 9. Central key systems 10. Location of the project in a resort area 11. Owner-occupancy density: The project may have few or even no owner occupants 12. Projects converted from a hotel or motel
Lenders must thoroughly examine the appraisal and contract of sale to determine if there are guaranteed rent-backs, references to rental pooling or management agreements, and SEC filing references and/or prospectus documents.
The Internet has become a common source for project and unit-specific information. The applicable project’s Web site may contain information on the project type, amenities, and availability of units for rent.
This is Freddie Mac’s definition:
Condominium Hotel A Condominium Hotel is a Condominium Project in which any unit owner or the Homeowners Association is a party to a revenue-sharing agreement with either the developer or another third-party entity. Mortgages secured by units in a Condominium Hotel are not eligible for sale to Freddie Mac. Freddie Mac's determination that a project is a Condominium Hotel is conclusive.
The definition is quite vague. It does go on for several pages and give slightly more detail but in reality, Freddie Mac will make the determination and there is no recourse if they decide that the property is a condo-tel. Are you starting to see why lenders are becoming very careful when looking at any condominium? One of the sites that is causing problems is VRBO.com. I am not being critical of the site or what it does because it has found a need and is filling it. You can visit the site and pull up Myrtle Beach to see how many units are being offered as rentals. This is what an underwriter will do.
So far, I have tried to present the situation as it is today. With all of that said, lenders ( Like my preferred lender, Mike Hogue) are still in the business of making condominium loans. In the next sections, I will review some available conventional financing options along with some non-conventional options. I will also list condo projects in our area which are already approved for conventional financing and explain how to get project approval for both new and existing condominium projects.
Eligible projects in the Myrtle Beach area
In doing research for this presentation, I have found that my preferred lender, Mike Hogue, has access to several lists of eligible condominium projects. These lists are compiled by Fannie Mae, HUD (FHA) and various other conventional lenders. They all have one thing in common. They all contain some type of disclaimer basically saying that the list is subject to change at any time and that ultimately it is the lender’s responsibility to insure that the loan is saleable. Something else to remember is that many times only part of a project gets approved. Just because a project is on the list, it does not mean that every building and phase in the project is approved. I wanted to include this list to show that there are still options available for conventional financing.
Indian Wells Golf Villas Jasmine Lake Condominium Villas on the Green Sea Gardens Condominium Wyngate Condominiums Egret Run Kiskadee Park Bay Meadows Condominiums Colony Club Courtyard Homes at Cascade Garden Creek Condominium Hawthorne Condominiums Heatherstone II Shorewood Condominiums Wellington at Palmetto Point Windsor Green Condominium Wynbrooke Condominium Landings at River Club Condominium Lauderdale Bay Condominium Park West Condominium 608 63rd Ave Arcadian Lakes Carolina Keyes Chateau by the Sea Condo
Cypress Bend Edgewater Ironwood at Barefoot Resorts River Oaks Golf and Tennis Villas Seven Oaks Shadow Moss South Bay Lakes II Southbridge I Southbridge Villas III Summer Times Sweetwater Teal Lake Village Condo Tidewater Ridge Tupelo Bay Golf Resorts Waterway Village at River Oaks Wedgewood Condo
If you have or are interested in listing your condo with me (Jake Lee ( www.SCRealEstatePartners.com )) or are working with me to purchase a condo.. my prefered lender, Mike Hogue at First Home Mortgage 843-685-2465, would be happy to do the research for you and let you know what options are available for a particular condo project. If you would like to email him the project name and address, his email address is:
MHogue@gofirsthome.com
Condominium Project Approval
The best way to insure that financing will be available for a condominium is to apply for project approval. Fannie Mae has recently revived project approvals after a 2 year hiatus. FHA has had a spot approval program for years that is now slated to disappear shortly. The deadline has been extended to February 1 and we are hoping it will be extended again. I will talk more about FHA loans later.
Once a project has Fannie Mae approval, a lender is assured that the loans done there will be saleable. Unfortunately, the process is arduous and expensive so that it is normally only done by a builder during the construction process. That is why it is not uncommon for a project to be partially approved. Once a builder has met certain requirements in the earlier phases, conventional financing may become available for later phases without Fannie Mae approval.
Your lender will normally handle the process for you. In order to submit an application, your lender will need recorded condo documents, bylaws, budget, insurance, FNMA 921 and an appraisal. My preferred lender, Mike Hogue with First Home Mortgage, contracts with an outside company whose only business is Fannie Mae approvals. The cost can be paid by the builder, realtor, lender or some combination. If you are a builder interested in the process, Mike Hogue and I would be happy to meet with you.
Famous Fannie Mae 921 Form CONDOMINIUMHomeowner’s Association Certification | | |
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Date: |
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Loan #: |
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Seller Contact Name & Phone: | | |
Project Name & Address: |
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Applicant(s): |
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| | | 1. | Have all units, common elements, and/or facilities been completed? | Yes No | | | 2. | Is the project subject to further expansion? If yes, # of additional units to be built: ___ | Yes No | | | 3. | Is the project a conversion of an existing building? If yes, year converted: ____ | Yes No | | | 4. | Date control of the HOA transferred from developer to unit owners: |
| | | 5. | Total number of units in project: |
| | | 6. | Number of units sold and closed: |
| | | 7. | Number of units under contract: |
| | | 8. | Number of units rented: |
| | | 9. | Are there multiple sales to one investor: If yes, list breakdown: | Yes No | | | 10. | How many units are over 30 day’s delinquent? |
| | | 11. | Are there any pending special assessments? If yes, explain: | Yes No | | | 12. | Is the HOA involved in any litigation? If yes, explain: | Yes No | | | 13. | Are there any adverse environmental factors affecting the whole project or as individual units? | Yes No | | | 14. | Does the owner’s association have a reserve fund separate from the operating account? If yes, is it adequate to prevent deferred maintenance? Current amount in fund: $ |
Yes No | | | 15. | Total income budgeted for the year: | $ | | |
| Total reserves budgeted for the year: | $ | | | 16. | Do the project legal documents include restrictions on sale, which would limit the free transfer-ability of title? (e.g. Age Restriction, First Right of Refusal, low to moderate income restrictions) |
Yes No | | | 17. | Is the unit part of a legally established condominium project, in which common areas are owned jointly by unit owners? |
Yes No | | | 18. | Are the units and/or common areas owned in fee simple or leasehold? |
| | | 19. | Can units be rented on a daily basis? If yes, how many years has this been permitted? | Yes No | | | 20. | Is there any on-site rental desk? | Yes No | | | 21. | Are daily maid/cleaning services offered and/or are there any on-site restaurant/food services? | Yes No | | | 22. | Is project subject to timeshare ownership or mandatory rental pools? | Yes No | | | 23. | Is any part of the project used for commercial purposes? If yes, what percentage of square footage? | Yes No | | |
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| | | INSURANCE: |
| Yes No | | 24. | Who is named insured on HOA’s master insurance policy? |
| | | 25. | Are common elements/limited common elements insured to 100% replacement cost? | Yes No | | | 26. | Coverage $____________ Deductible: $_______________ Expiration Date: _____________ | Yes No | | | 27. | Are units or common improvements located in a flood zone? | Yes No | | |
| Or, is the coverage the maximum available per federal flood program? | Yes No | | |
| If yes, is flood insurance in force? | Yes No | | |
| Does this cover 100% replacement? | Yes No | | | 28. | Is the HOA insured for General Liability? If yes, amount $_________________ |
| | | 29. | Is the HOA INSURED for Fidelity Bond? If yes, amount $___________ | | | 30. | Minimum number of days required for written notification to be given to HOA or insurance trustee before any substantial changes to project coverage can be made or before project coverage can be canceled: | | |
I hereby certify that the information represented on this form is true and correct to the best of my knowledge. | | |
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| | | Signature |
| Homeowner Association Representative’s Title |
| Phone | | |
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| FHMC 5/1/01 | | | | | | | | | | | | | | | | | | | | | |
Available Programs
There are three basic types of financing. The most common is conventional/conforming. The second most common is FHA, which I will talk about in the next section. The third type of financing and one that we are starting to rely on more and more is non-conforming. Non-conforming loans are just what they sound like. They do not conform to agency guidelines and are done by portfolio lenders. Portfolio lenders can make their own rules so are able to lend on properties and to individuals that would not normally qualify for financing.
You may have noticed that many lenders are pushing for condo buyers to put 25% down on second home condominium purchases. The reason is that Fannie Mae offers a limited project review when there is a down payment of at least 25%. Lenders have been able to avoid a lot of the problems involved in distinguishing between a condo and a condo-tel with a limited project review. This is an area that I am finding is becoming more and more difficult for lenders. Does a limited review take away liability for a lender? My feeling is that very shortly, the limited review process will not be allowed to eliminate the need for a lender to go into a deeper review of every condominium to determine if it fails any of the condo-tel tests. In plain language, if there are any web sites offering daily rentals for any condos in the project, the loan will be rejected.
That brings me to portfolio lenders. We have been very fortunate in finding a lender who loans on the borrower rather than the property. Their criteria is very strict but we are using them more and more to finance condos and condo-tels. There may be other lenders locally who still finance condo-tels on a case by case basis. The only way to find out is to ask your lender, as well as your local expert Realtor Jake Lee how they are obtaining financing for their condos and condo-tels.
FHA Condo Loans
There have been some changes to the entire process of getting an FHA condominium approval. There are also changes to the type of financing you can do within an FHA approved condominium project. Most of the changes took effect on December 7, 2009. There is some good news and some bad news coming with the changes.
The good news is that the project approval process has been streamlined. The documentation list is very reasonable and the cost to obtain approval should be minimal. There have also been some temporary changes in the guidelines to reflect current market conditions. The bad news is that FHA spot loans in unapproved condo projects will be eliminated as of February 1, 2010.
Since Myrtle Beach has a large concentration of second homes, you may feel that the FHA changes are immaterial since FHA loans are only for primary residences. Historically, Fannie Mae would accept condominium loans in projects with FHA approval. We have just been informed that as of February 1, 2010, Fannie Mae will not accept an FHA project approval. That is the sum total of what we have from Fannie Mae.
Suggestions for Improvements Going Forward
I would love to end this by saying that this will all end shortly and soon it will be back to business as usual. I do not believe that will be the case. After years in the Real Estate Business buying and selling homes and condos, I have seen the guideline pendulum swing back and forth repeatedly between too lenient and too strict. This time will be no exception. Eventually the guidelines will begin to allow more leeway. Until then, I will give my opinion of what we can do to lessen the effect of the guideline changes.
When a lender is looking at a condominium to determine whether or not it is eligible for conventional financing, one of the first places they look is Google. Many times we are finding that individual unit owners are offering their units for nightly rentals, even if this is in violation of the condo bylaws. In most instances, conventional financing will not be allowed. My first suggestion is to push homeowners associations and management companies to do the exact same search that lenders do and insist that those sites be removed from the internet. This will have an immediate and positive effect on the condominium market.
If you are interested in purchasing a home, condo, or townhouse along the South Carolina Coast including Myrtle Beach, Pawleys Island, Murrells Inlet, ETC be sure to call me (Jake Lee 843-240-0431) or visit me on the web at www.SCRealEstatePartners.com . If you have any questions about these condo regulations please call me or my preferred lender, Mike Hogue 843-685-2465 at any time.
We look forward to working with you and assisting you in the purchase of your new home or investment in Myrtle Beach
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For those who are watching rates on Mortgages for either a home purchase or refinance - This week, there are a number of important economic releases as well as daily treasury auctions Monday through Thursday. On Wednesday, the Federal Reserve will release its Fed Beige Book Report which details economic conditions in regions throughout the country and is used by the Fed in making rate and policy decisions. Retail Sales for December will be released on Thursday, followed by the December Consumer Price Index and Industrial Production on Friday. Mortgage rates on average are slightly higher this morning. These are the economic indicators that will control the direction of rates for the next week or two - If you are ready to purchase your next home or maybe your first, give us a call! 843-240-0431 or visit us on the web at www.SCRealEstatePartners.com We ( Jake Lee and Ann McKinnon ) represent both buyers and sellers along the coastal regions of South Carolina including Myrtle Beach, Surfside Beach, Murrells Inlet, Pawleys Island, Georgetown, Longs, Little River, Conway, North Myrtle Beach, and other more inland towns! Our services as buyers agents are free to buyers! Come get your no cost representation! You can also visit us on the web to get free foreclusre lists, short sale lists, information about our coastal towns, search the mls, search listings by a map, submit an offer ONLINE, and MORE. Come see why we are the top real estate team in our area!
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SC State Housing lowers rates for first-time home buyers
If a home purchase is in your plans for the new year, the South Carolina State Housing Finance and Development Authority's (SC State Housing) new low interest rates and down payment assistance may be just the break you have been waiting for.
As of Monday, January 4, 2010, SC State Housing set its rates at 5.25% in Categories I and II, which include borrowers earning 50.01% and above of median income, and 5% for those in Category III, covering borrowers earning 50% and below of the median income as well as disabled borrowers (rate sheet attached). All categories offer up to $5000 down payment assistance. Down payment assistance is repayable for borrowers in Category I and forgivable in Categories II and III. First-time home buyers may also take advantage of up to $8000 in federal tax credits if they purchase a home before April 30, 2010, with a 60-day extension if a binding contract is in place prior to that deadline. Members of the Armed Forces, Military Intelligence and Foreign Service who are on extended overseas duty or who have been on active duty for more than 90 days in 2008 and 2009 have another year to use the tax credit (through June, 30, 2011). SC State Housing recognizes both "targeted" and "non-targeted" counties. In the non-targeted counties (Aiken, Anderson, Charleston, Greenwood, Greenville, Lancaster, Lexington, Oconee, Pickens, Richland, Spartanburg, York) a first time homebuyer is someone who has never owned a home or who has not owned a home in the last three years. In targeted counties (Abbeville, Allendale, Bamberg, Barnwell, Beaufort, Berkeley, Calhoun, Charleston*, Cherokee, Chester, Chesterfield, Clarendon, Colleton, Darlington, Dillon, Dorchester, Edgefield, Fairfield, Florence, Georgetown, Hampton, Horry, Jasper, Kershaw, Laurens, Lee, McCormick, Marion, Marlboro, Newberry, Orangeburg, Saluda, Sumter, Union, Williamsburg *County Census Division #53, Ravenel Division) a first-time home buyer may not own a home at the time of closing. Also, buyers moving from a non-targeted area into a targeted area may qualify so long as they do not own a home at time of closing and meet the other qualifications for home price and family income. "This is great news for potential home buyers and sellers in South Carolina," said Valarie M. Williams, SC State Housing's Executive Director. "Selection is good and prices are right for first-time buyers. With our new lower rates and down payment assistance, many more South Carolinians will be able to purchase their own home in 2010." Williams encourages anyone who is considering buying a home to ask their lender or real estate agent if they qualify for a loan under the SC State Housing program. Since the Mortgage Revenue Bond (MRB) Program's inception, SC State Housing has made more than 37,000 first mortgages, for a total investment of well over $2.2 billion. Nearly 13,000 Down Payment Assistance Loans have been made, accounting for more than $29 million. Moody's Investors Service, a major municipal bond rating agency, recently gave its highest rating of Triple A (Aaa) to SC State Housing's MRB Program. For information about purchasing a home in the myrtle beach, conway, pawleys island, Murrells Inlet areas using sc housing go to www.SCRealEstatePartners.com orcall Jake Lee 843-240-0431 or Ann McKinnon 843-907-6899.
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Only 4 blocks from the ocean !!
• 3,000 sq. ft., 3 bath, 3 bdrm 2 story "Raised Beach Style Home" - MLS® $359,900 USD - Walk to the beach !! South Surfside Beach, Surfside Beach - This home is only 4 blocks from the beach. Front of house has large screen porch and a patio out back. Deep lot with part of the back fenced in. Home has vaulted ceiling in great room and plantation shutters with a laundry room off the kitchen. Detached storage under with a half bath on ground level. There is alift to living area for handicapped. Lovely beach home ready to move in. Some furniture conveys. This home is no located in a designated flood hazard Property information You can also visit http://Walk2TheBeach.SCRealEstatePartners.com to view this listing directly at any time!!
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Carolina Pines, Conway - The 2 story at I8-1025 Carolina Road has been sold. Property information Another great property sold by the area's real estate expert, Jake Lee. Looking to buy or sell your next home, condo, or real estate investment in Myrtle Beach, Pawleys Island, Murrells Inlet, or other surrounding areas? Call Jake Lee 843-240-0431 to get started today !! You can also visit Jake on the web at his state of the art real estate website at www.SCRealEstatePartners.com where you can get info about all the towns around the Grand Strand and Lowcountry, get a FREE foreclosure list, FREE short sale list, Search the mls, MUCH MUCH MORE
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Carolina Pines, Conway - The townhouse at v1-1025 Carolina Road has been sold. Property information Interested in purchasing one like this? There is currently a 3br foreclosure in here for only $57,000. Call Jake Lee today at 843-240-0431 and isischedule a showing or make an offer! Visit www.SCRealEstatePartners.com for more info about this area, a foreclosure list, short sale list, search mls listings, make an offer online, view virtual tours, MORE
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