This week Rich and Steve had Richard Godfrey, Executive Director of
Rhode Island Housing to talk about the many services and programs for first-time homebuyers RI housing offers. First and most importantly are their homebuyer education classes. These classes provide information to help the homebuyer make prudent home buying decisions. Once homebuyers complete an education class, they are encouraged to work through the mortgage pre-approval process, with this information, the homebuyer can work with a real estate professional to find a home in their price range. RI Housing even has a well-received FirstHomes program, which provides a 100% financing options, closing-cost assistance and rehab funds. With interest rates and prices so low, for those who have been budgeting for a house and are financially ready to buy, it is a good time to buy but it is always important to
buy smart. There are three major things to consider: 1.
Interest rates. Right now they remain the lowest they have been since the 1950s. 2.
Housing prices: Although there has been a slight increase -- on average 5 % with the median price currently at $210,000. Prices still remain at levels seen in 2002 - 2003 (when the median price was between $188,000 and $235,000.) Prices may move a little up or down in 2011 but if people buy what they can afford, it is a great time to buy. 3.
Inventory of homes for sale: There are many more choices of homes at all price levels and the inventory is high with an average number of listings monthly in the thousands. Many of the homes that first-time buyers are considering need a lot of work. Rhode Island Housing has a special loan, called FirstHomes100 plus, a fixed-rate loan for first-time homebuyers who need to complete essential repairs and upgrades. Included in this product is a consultant, who has been approved by HUD, to help them through the renovation. Rhode Island Housing also administers and oversees a foreclosure-prevention program called HHFRI, Hardest Hit Fund Rhode Island. HHFRI is an $80 million program designed to help prevent as many foreclosures as possible by assisting struggling homeowners with their mortgage payments. If you are paying more than 31 percent of your gross monthly income toward a mortgage payment, they might be able to help you make up the difference. In addition, Rhode Islanders may qualify for this assistance if they have had a hardship such as underemployment, death or disability of a key wage earner in their family, unforeseen medical expenses or costly home repairs as a result of the flooding during the spring of 2010. Qualifications for HHFRI funds are:
- Homeowners can have savings of as much as $15,000
- Members of the U.S. Armed Forces who have experienced a drop in income due to deployment. (This applies to all enlisted personnel in regular and reserve units of the Army, Navy, Air Force, Marines and Coast Guard.)
- Rhode Islanders can own more than one property and qualify on the home they live in.
- In special circumstances, homeowners can receive up to $42,500.
The three ways to apply are:
- Through a HUD approved and HHFRI counselor including the Rhode Island Housing HelpCenter, 401-457-1130 or www.HHFRI.org.
- Call the HHFRI Center at 401-277-1500 directly and immediately start the process.
- If your lender is Rhode Island Housing, you should call 1-800-854-1180. If your lender is a local bank, you can check the HHFRI website for contact information.
Homeowners who do not qualify for HHFRI assistance may have other options. With the help of HUD approved counselors and centers like RI Housing's HelpCenter, homeowners can work with their lender to explore all their options - modifications, forbearance, short sale, deed in lieu of foreclosure. Homeowners should be wary of paying anyone money who tells them they can guarantee a modification from their lender. Many homeowners pay companies who make these promises, only to find that they were the victim of a scam, and have lost money that they could have used to help pay their mortgage.
Dealing with a HUD certified counseling agency is the safest way to get help with these issues. Having to pay a company up front for assistance is a warning sign. Homeowners should be very cautious if money is requested
This Week's Real Estate Insight: I would encourage first-time homebuyers to take an education class. Rhode Island Housing offers them frequently throughout the summer, and you can sign up for one by calling 401-457-1245. You can find a schedule at
www.rhodeislandhousing.org. In addition, I urge anyone having difficulty making a mortgage payment to out to their lender and/or a HUD-approved counseling agency such as Rhode Island Housing's HelpCenter, 401-457-1130. The earlier the homeowner seeks assistance, the more options available. Don't wait. Visit
www.HHFRI.org or email:
info@HHFRI.org for more information
