Demystifying our current economic windfall of $72 million from the federal government and the Neighborhood Stabilization Program may prove to be more difficult than expected.
First, according to the Nevada Housing Division administrators they must leverage the money received from the federal government and make a meaningful difference by affecting neighborhoods where a bank has 15 to 20 homes in foreclosure and convince that bank to lower the value of the homes to current market value.
How will this impact Nevada residents? As the leading State in the nation for foreclosures this means that statewide this program will allow for 288 homes to be purchased by "qualified" buyers at an estimated purchase price of $250,000. To put this in perspective Washoe County is averaging 30 Notice of Defaults a day while Clark County is averaging 100 according to Laura Gamino of Reno's Landlord Defense Bureau.
Second, this money will only go to qualified First Time Home Owners looking to obtain special Nevada Housing Loan financing and these individuals need to be willing to purchase a "qualified" bank owned property.
What does this mean? Who knows! I would recommend emailing Lon DeWeese, chief financial officer for the division, and asking how you can find one of these qualified properties or if a list exists?
Finally, the loan you are qualifying for while competitive may not be the best alternative.
Currently, the rates for 30 year fixed loans for Nevada Housing Division's Fist Time Homebuyer Program are at 7.25% and should you need down payment assistance that loan will cost you 9.25% for the second loan ($10,000 second loan limit). Just a reminder with this new $72 million you are required to buy a property that the Division determines to be suitable.
While this money is welcomed it only scratches the surface in regards to helping Nevadans. There are several great real estate opportunities available in this current market along with many financing alternatives available. Unless you like bureaucracy and taking on the challenges of jumping through government hoops; you may be better of consulting first with a local real estate professional directly and seeking their advice. I will be hosting another Foreclosure Seminar on Friday November 7th. This class will discuss topics like: the current economy and its impact on Nevadans, the Short Sale process, the foreclosure process and current financing alternatives including loan modifications.
Jason Norris, MBA, CMPS, President MFG Mortgage Services, LLC 1.775.322.0496
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