hurricane-sandy-hudBuying A New Home After Hurricane Sandy

HUD’s Section 203(k) loan program assists those who lost their home to finance the purchase of a new home or refinance for home repairs. It encourages lenders to make mortgages available to borrowers who would not otherwise qualify for loans.

Visit http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/203k for more information.

HUD’s Section 203(h) program provides Federal Housing Administration (FHA) insurance to victims who lost homes. Those who borrow from participating FHAapproved lenders are eligible for 100 percent financing, and closing costs.

Visit http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/ins/203h-dft for more information.

If you have been unable to keep up with mortgage payments because of Superstorm Sandy foreclosure prevention assistance may be available.  Homeowners with Federal Housing Administration (FHA) insured mortgages may be eligible for a foreclosure moratorium, which freezes foreclosure activities to give you time (i.e., 90 days) to work with you lender to make payments. HUD’s Disaster Relief Options for FHA Homeowners is a great reference.  You must apply to your lender within one year of the President’s declaration of the disaster (Oct. 30, 2013).

Mortgage Relief
Fannie May has mortgage relief provisions for borrowers, and mortgage servicers may grant forbearance to any borrower affected by a natural disaster. Within 90 days, servicers are expected to establish contact with homeowners who have been affected and determine if additional assistance is necessary.

Under Fannie Mae’s disaster relief guidelines, a servicer may temporarily suspend or reduce mortgage payments for up to 90 days if the servicer believes a natural disaster has adversely affected the value or habitability of the property, or if the natural disaster has temporarily impacted the homeowner’s ability to make payments. Since a storm may make it difficult to reach homeowners, Fannie Mae allows servicers to grant this temporary relief even if they cannot contact the impacted homeowner immediately.

Homeowners should contact the lender to whom they send their monthly mortgage payment. Homeowners can also contact Fannie Mae through one of twelve Mortgage Help Centers. Contact information is available at www.knowyouroptions.com or by calling 1-800-7FANNIE (6643).

Freddie Mac disaster relief policies provide a number of ways for mortgage servicers to help affected borrowers in disaster areas. Freddie Mac strongly encourages servicers to help affected borrowers with Freddie Mac-owned loans by:

  • Suspending foreclosure and eviction proceedings for up to 12 months;
  • Waiving assessments of penalties or late fees against borrowers with disaster-damaged homes; and
  • Not reporting forbearance or delinquencies caused by the disaster to the nation’s credit bureau.
  • Homeowners who have experienced hardships should contact the lender to whom they send their monthly mortgage payment, call Freddie Mac at 1-800-FREDDIE, or learn more about Freddie Mac Mortgage Relief Information online.

Learn more about Mortgage Relief Programs

Working with a Real Estate Agent
Real Estate Agents have legal obligations to their clients.  Your agent must disclose whether he or she represents the seller. He or she has the legal obligations to provide you with reasonable care, undivided loyalty, confidentiality and full disclosure.  Please feel free to contact us for a complimentary consultation or register for our free Automatic Property Alerts.

The seller has obligations as well.  The seller must fully disclose all known defects, or defects that should have been known concerning water and sewer systems, insulation, structural systems (e.g., roofs, walls, floors, foundation and basement), plumbing, electrical, heating and air-conditioning systems. Failure to do so is fraud.  In the wake of Hurricane Sandy you may want to invest in a mold specialist to conduct testing.

If the house was built before 1978, the seller must notify you of any lead problems I found a house that I’d like to buy and my real estate agent asked me to sign a “contract of sale.” In New Jersey, the real estate purchase agreement is called a “contract of sale.” It establishes the respective rights and responsibilities of the purchaser and the seller.

The contract should be in writing and include the all of the following information:

  • The parties’ names
  • purchase price; how you will pay it, including amount of down payment
  • an adequate description of the property being sold
  • the kind of deed to be delivered
  • the quality of the seller’s title to the property included in the sale
  • when the transaction will “close” or title will transfer
  • the date you are to take possession of the property
  • provisions for title searches, insect, structural and other inspections
  • additional clauses relating to the property and the parties’ respective responsibilities to each other

Patrick Parker Realty experts are skilled contract negotiators and handle these details from beginning to end.  Learn more about contract negotiations.

Working with An Attorney
In New Jersey, the law does not require you hire an attorney but law does require a three day attorney review period on contracts prepared by a realtor. This is to protect you from being bound to a contract without having an attorney advise you as your legal rights.

Inspections
You are not legally required to have an inspection of the home you wish to purchase, but it is a good idea to hire an independent professional home inspection service before you buy a house.  You and the seller may stipulate in the contract that if any defects are revealed by the inspection, the seller may correct the defect within an agreed-to amount of time.

Title Insurance
Owner’s Title Insurance, called an Owner’s Policy, is usually issued in the amount of the real estate purchase. It is purchased for a one-time fee at closing and lasts for as long as you or your heirs have an interest in the property. Only an Owner’s Policy fully protects the buyer should a covered title problem arise with the title that was not found during the title search. Possible hidden title problems can include:

  • Errors or omissions in deeds
  • Mistakes in examining records
  • Forgery
  • Undisclosed heirs

An Owner’s Policy provides assurance that your title company will stand behind you — monetarily and with legal defense if needed — if a covered title problem arises after you buy your home. The bottom line is that your title company will be there to help pay valid claims and cover the costs of defending an attack on your title.

Title Insurance is required in New Jersey and Patrick Parker Realty can refer you to our Title Partners as part of our turn-key service.

For further assistance purchasing a new home or to speak to a Patrick Parker Realty Hurricane Displacement Specialist call 732-455-5252 or contact us online.