Entries in Real Estate (24)


New TIL and GFE Form

The Consumer Financial Protection Bureau (CFPB) recently released its fifth version of the draft mortgage disclosure form comparing a fixed-rate loan and an adjustable-rate  loan.  The CFPB said it will test this version of the disclosure with consumers, and consumers are invited to  go to this page to enter comments on the proposed form:  ”Know Before You Owe".  It appears that  the Bureau will finalize this form which combines the Truth in Lending form and Good Faith Estimate form in the very near future.

The CFPB has indicated it will release the first draft of a revised HUD-1 before Thanksgiving.   The last revision to the HUD form, which was effective on January 1, 2010, completely changed the form from a 2 page form to a 3 page form and  is very unpopular in the industry.


AJC Reports Foreclosure Plummet

Foreclosures in Atlanta fell to their lowest point in more than two and a half years in September, the latest low point in a trend that has seen figures yo-yo 25 percent or more from month to month.

The Atlanta Journal Constitution reports that loan servicers have slowed foreclosures because home prices are weak and inventory is high and because servicers are working harder with borrowers to keep people out of foreclosure by restructuring loans.

But has the market bottomed out or is this just additional volatility in a difficult time?

The truth is no one knows but we can only hope that this is the beginning of a trend.


Cost of Secondary Loan Bailouts to Exceed Fifty Billion

Fannie Mae and Freddie Mac will cost taxpayers $51 billion between 2012 and 2021, according to a new estimate released by the Congressional Budget Office.  Since placing the government-sponsored enterprises in conservatorship in 2008, the Treasury Department sent $170 billion in subsidies through the second quarter, of which $27.9 billion has been paid back.

The Congressional Budget Office estimates that the yearly payments to Fannie and Freddie should go down, and the current estimate is that $5 billion will be sent to both mortgage giants by the end of 2011..

The outlook for the long-term mortgage market remains tentative. Fannie, Freddie and the Federal Housing Administration guaranteed or financed 95% of new mortgages in 2011.


Yet Another Form Change for Residential Closings

The Consumer Financial Protection Bureau recently revealed two prototypes of mortgage disclosure forms. 

The two prototypes combine the federal Truth in Lending Act mortgage disclosure form with the Real Estate Settlement Procedures Act to remove redundant information and hopefully allow consumers to make decisions based on clear and concise language. It would seem that the Ficus Bank is a bit simpler and easier to read but a second form call the Pecan Bank form is also available for review.

Of course there was just a major change in RESPA 18 months ago when the RESPA settlement statement form was substantially revised. 


IRS Scrutinizes Gifts of Real Estate

The Internal Revenue Service has a low-profile but sweeping effort under way to use state deed records for evidence of omissions in reporting gifts of real estate to family members. 

New tax rules have made big gifts to family members popular this year, as Congress raised the limit on how much a person can give in a lifetime to $5 million without having to pay gift tax. Still, any time a gift to one person exceeds $13,000, the giver is supposed to let the agency know in a filing. 

The IRS is apparently underway with a coordinated effort to find people who haven't filed Form 709 to report U.S. gift and generation-skipping transfer taxes to the IRS. 

So far the following states that have handed over information on gift-like transactions:  Connecticut, Florida, Hawaii, Nebraska, New Hampshire, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia, Washington and Wisconsin. 

Please be aware that there is no special exception to the rules when making a transfer to a family member and if you are making a gift of property valued at more than $13,000, a gift-tax return must be filed.