Author: khaniauerbach

Time to Buy and Refinance is Now!

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Are you wondering what the rates on mortgages are hovering around these days? Data released on Thursday by Freddie Mac indicates that the 30-year fixed-rate average ticked down to 3.79 percent with an average 0.6 point. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 3.82 percent a week ago and 3.92 percent a year ago. The 30-year fixed-rate average has remained below 4 percent for three months.

The 15-year fixed-rate average dropped to 2.98 percent with an average 0.5 point, falling below 3 percent for the second time in three weeks. It was 3.03 percent a week ago and 3.08 percent a year ago.

Hybrid adjustable rate mortgages moved higher. The five-year ARM average edged up to 2.89 percent with an average 0.4 point. It was 2.88 percent a week ago and 2.91 percent a year ago.

The one-year ARM average jumped to 2.62 percent with an average 0.2 point. It was 2.54 percent a week ago.

Now, really is the time to buy and refinance!

New Mortgage Disclosures Expected to Delay Real Estate Closings

Posted on by khaniauerbach

Our sincerest apologies for not having provided you with new content in such a long time, but we have been working tirelessly on becoming prepared for the changes ahead! In just a few short days, federal laws will be implemented that will affect the way homebuyers finance their mortgages in real estate transactions. The Consumer Financial Protection Bureau created “TILA RESPA Integrated Disclosure,” known in the industry as TRID, and TRID implementation begins on Saturday, October 3, 2015. Most, if not all, of the experts in our industry agree that these changes could increase the time to close on purchases by at least double. Take note, these changes do NOT affect all-cash or commercial transactions. Furthermore, the implementation of TRID will only affect loan applications that are taken on residential purchases that are financed ON or AFTER Saturday, October 3rd. So, if you are able to squeeze in a loan application before that date, you will avoid being subject to these changes. Our local colleague, Gary M. Singer, outlines all these changes and we have reposted his article originally published in the Sun Sentinel, below:

Sept. 25, 2015

By GARY M. SINGER Sun Sentinel – Tribune News Service

Big changes are planned for how homebuyers finance their mortgages, and that almost certainly means that closings will take longer. In some cases, closings that now speed through in 30 days probably will require at least 60 days.

The changes had been expected to begin in August, but the effective date was pushed back to Oct. 3.

After the housing crash, Congress felt that we needed a better system of mortgage disclosures and procedures so that Americans can better protect themselves and make the best choices when getting home loans.

The Consumer Financial Protection Bureau was created and charged with accomplishing this.

The bureau decided that the four existing disclosure forms required under federal law would be changed into two new, more comprehensive documents — a Loan Estimate and a Closing Disclosure.

These forms are known as the “TILA RESPA Integrated Disclosure,” or more commonly, TRID.

In addition, the closing process was unified so that all 50 states use the same forms and procedures.

Who Do These New Rules Apply To?
They apply to residential properties that include a mortgage as part of the transaction — both sales and refinances.

The rules are designed to protect the buyer/borrower, but they will affect all parties to the transaction.

Lenders are bearing the brunt of ensuring compliance with the new rules, making the lender responsible for getting all of the other parties on board. The rules do not apply to commercial transactions or all-cash deals.

What is Changing?
Buyers applying for loans will get a Loan Estimate (instead of the current Good Faith Estimate) within three days of applying for the loans.

The new form is designed to highlight key terms to enable borrowers to shop around for the best deals. It’s supposed to be user-friendly and almost certainly will be, considering how confusing the current form is.

The Closing Disclosure must be received by the borrower three business days before the closing. If the form is mailed, couriered or emailed, the lender must allow an extra three business days on top of that.

This means that the closing can’t occur for at least six business days after the lender sends out the completed Closing Disclosure.

This is a massive change from the way it is now, when some of the information is still being filled in on the closing day, sometimes even while the parties are sitting at the closing table.

The biggest issue I have with these new forms is that they significantly downplay the importance of getting owner’s title insurance policies, which is money well spent. I can’t think of any situation in which not getting this very important coverage would be a good idea. And I’ve seen many instances in which not having title insurance costs a buyer the home.

K&A note: There are many ways a person can lose their home as a result of not having an Owner’s Policy for Title Insurance. Should you wish to learn what they are, contact us and we’ll share that information with you. It’s certainly not a short list and being uninsured can definitely result in the loss of property.

What do Buyers and Sellers Need to Do?
Closing agents — used to finalizing the process at the last minute to accomplish everyones’ rush to close — now will need to get the final closing information to the mortgage lender at least 10 days before the closing date so that the lender can complete the Closing Disclosure in time to get it out six days before the scheduled closing.

Realistically, to accomplish this, buyers and sellers will need to add three to four weeks to their closing time lines.

To make matters even more confusing, all of the standard purchase contract forms have been recently changed to address the new rules.

That’s causing real estate professionals to learn the new forms.

K&A note: If you are a real estate professional, please reach out to us for guidance on the new forms. We are all in this together and are looking forward to making all future transactions go as smoothly as possible.

Be sure your real estate agents and others on your team are aware of the new information and have been trained on how to deal with it.

Fortunately, the industry seems ready for this change, and there is plenty of training available for those in the business.

About the Writer
Gary M. Singer is a Florida attorney and board-certified as an expert in real estate law by the Florida Bar. He is the chairperson of the Real Estate Section of the Broward County Bar Association and is an adjunct professor for the Nova Southeastern University Paralegal Studies program.

The information and materials in this column are provided for general informational purposes only and are not intended to be legal advice. No attorney-client relationship is formed. Nothing in this column is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction.

This article, originally dated 9/25/15, was re-posted from the Sun-Sentinel, distributed by Tribune News Service.

Contracts to Buy Residential Real Estate Climbs to 9-Year High

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Victoria Park canalAccording to the National Association of Realtors (NAR), pending home sales continued to make impressive gains last month, rising to the highest level since April 2006. In May, more Americans signed contracts to purchase homes, as these pending sales reached their highest levels in over nine years.

Large gains in pending home sales in the Northeast and West helped to offset small decreases in the Midwest and South.
Here’s a more detailed look at how the Pending Home Sales Index performed regionally in May:

• Northeast: rose 6.3 percent to 93.9 last month and is 10.6 percent above a year ago.
• Midwest: fell 0.6 percent to 111.4 but remains 7.8 percent above year ago levels.
• South: dropped 0.8 percent to 127.8 but are still 10.6 percent above last May.
• West: rose 2.2 percent to 104.5 in May and are 13 percent above a year ago.

NAR’s Pending Home Sales Index rose 0.9 percent in May to 112.6 in May. The index is at its highest level since April 2006 when it was 113.7. The index has increased 10.4 percent over the past 12 months, putting it just below the April 2006 level—which was more than a year before the housing bust triggered the Great Recession.

Lawrence Yun, NAR’s chief economist states, “The steady pace of solid job creation seen now for over a year has given the housing market a boost this spring. It’s very encouraging to now see a broad based recovery with all four major regions showing solid gains from a year ago and new home sales also coming alive.” Although there are strong sales, Yun cautions that these are causing home prices to rise to an “unhealthy and unsustainable pace.”

Pending sales are an indicator of future purchases. Additionally, a one- to two-month lag usually exists between a contract and a completed sale.

Steady job growth, in conjunction with low but rising mortgage rates, has created greater urgency to buy homes. The gains reflect both a stronger economy but also the pressures to purchase a home before both prices and the cost of borrowing become potentially unaffordable. Despite Yun’s opinion, some other economists say that the job gains should be adequate to overcome the drag from higher rates.

Relatively low mortgage rates have assisted the real estate market, but the recent rate increases in recent weeks may possibly be causing more potential buyers to close transactions before higher rates inhibit their ability to purchase a home.
Average rates for a 30-year fixed-rate mortgage were 4.02 percent last week, up slightly from 4 percent in the prior week, according mortgage giant Freddie Mac. The average has risen from a 52-week low of 3.59 percent.

Chief economist at Pantehon Macroeconomics, Ian Shepherdson states, “We think the housing market can cope with slightly higher mortgage rates, taking home sales to new post-crash highs over the next few months.”

Median home prices climbed 7.9 percent over the past 12 months to $228,700, about $1,700 short of the July 2006 peak.

Call the attorneys at Khani & Auerbach (954) 921-1517 if you have any questions about this or any real estate matters.

Distressed Homeowner? Freddie Mac Offers a Complete Guide to Foreclosures and Alternatives

Posted on by khaniauerbach

uujjujuAs part of a new website launched this week, Freddie Mac is now offering distressed homeowners a complete guide to foreclosure and prevention, from assessing your situation to what to do when your home has been foreclosed on.

“MyHome by Freddie Mac” is an option on Freddie Mac’s site offering homeowners various options under the “Foreclosure and Alternatives” tab that guide a borrower on who to contact for help, as well as non-foreclosure solutions that include both home retention and home forfeiture options.

Freddie Mac initiates their discussion with a brief overview on the importance of getting an understanding of your financial situation and determining what a borrower can and cannot pay for in their home upkeep. If a borrower cannot pay for these things, continues to incur major expenses that keep them from paying the mortgage, Freddie Mac recommends reaching out to the lender as soon as possible.

Borrowers are warned to watch for the warning signs of foreclosure and to seek help if they look familiar. If a borrower needs guidance on avoiding foreclosure, Freddie Mac lists several options to contact for help: the lender, housing counselors, Freddie Mac borrower help centers, and house finance agencies. The key is to seek assistance before it becomes a permanent problem.

Some home retention solutions discussed for eligible borrowers are forbearance, reinstatements, repayment plans, and modifications, including the government’s Home Affordable Modification Program (HAMP). Non-foreclosure solutions in which the home is forfeited include short sales or deeds-in-lieu of foreclosure. There are several resources provided on the site to assist the borrower in understanding the options and how to properly prepare your financial documentation before meeting with the lender.

For situations where foreclosure cannot be avoided, Freddie Mac gives the borrower a list of what to expect after foreclosure that includes how it affects the borrower’s credit, how to rebuild credit, finding a home after foreclosure, and re-entering the housing market.

Additional options provided to homeowners who have already lost their home to foreclosure include: finding out who purchased the home after the foreclosure to increase options available. In some situations, if Freddie Mac acquired the home, options may include renting the home back while it’s being marketed for sale, receiving “cash for keys,” or purchasing the home back.

Khani & Auerbach is a law firm with experienced real estate attorneys and we are here to help.

Zillow LogoLooking to see the estimated value of a potential real estate purchase or real property you presently own? Check out our partners at Zillow for more information.

CFPB Fails to Comply with Congressional Review Act Moving TRID date to Oct. 3rd

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CourthouseIn a statement made June 17th, the Consumer Financial Protection Bureau (CFPB) announced a proposal to delay implementation of the TILA-RESPA Integrated Disclosures (TRID) rule until Oct. 1st. The CFPB’s original implementation date of Aug. 1st had been been pushed to Oct. 1st, as they claim an “administrative error” caused the delay of Know Before You Owe rule. On June 24, 2015, the Bureau announced in a new Press Release, the selection of Saturday, October 3, 2015, rather than October 1, 2015, as the proposed implementation date. 

Under the Congressional Review Act, the CFPB failed to timely notify Congress, which requires agencies to submit the rule to Congress and the Government Accountability Office 60 days before the effective date. The agency’s submission should include (1) a copy of the rule; (2) a concise general statement relating to the rule, including whether it is a major rule; and (3) the proposed effective date of the rule.

According to CFPB Director Richard Cordray, the bureau “made this decision to correct an administrative error that we just discovered in meeting the requirements under federal law, which would have delayed the effective date of the rule by two weeks. We further believe that the additional time included in the proposed effective date would better accommodate the interests of the many consumers and providers whose families will be busy with the transition to the new school year at that time.”

At Khani & Auerbach, we were already well on our way to being prepared to implement these new procedures into our real estate practice, however, the CFPB’s decision to delay the deadline for their implementation is great news for everyone. The consumers, the vendors and the industry in general are all not exactly “ready” and there are aspects of TRID that simply made no sense, further confusing the consumer. This push to Oct. 3rdst was definitely something we expected and comes as no surprise. The CFPB listened to the industry and its concern for consumers.

With that said, Khani & Auerbach highly recommends that you initiate your real estate transactions before the implementation date expected for October 1st.

Call the attorneys at Khani & Auerbach (954) 921-1517 if you have any questions about this or any real estate matters.

Uber It! Broward County Motor Carrier Ordinance Passes 4/28/15

Posted on by khaniauerbach

dad-aventadorAt the April 28th Broward County Public Hearing, the Board of County Commissioners voted to update and expand the County’s Motor Carrier Ordinance. As some of you may know, this item sparked a lot of attention, and now, the ordinance provides a framework allowing Uber, Lyft and other Transportation Network Carriers to operate legally within Broward County.

The County voted on a variety of matters, but the three that pertain directly to this issue include requirements for Transportation Network Carriers to conduct background checks, vehicle inspections and obtain insurance.

1. Background Checks:

All Uber and Taxi Drivers will:

• Provide their fingerprints to Broward County.
• Register with the County as a Chauffeur.
• The County will receive a “ping,” which is a computer alert, from the Florida Department of Law Enforcement if anyone working as a Chauffeur in Broward is arrested in the state of Florida.

2. Vehicle Inspections:

• All for hire vehicles must complete a 19 point vehicle inspection by an ASE Certified Mechanic once per year.

3. Insurance:

• State of Florida sets a minimum requirement for all vehicles for hire to be 24/7 coverage by a Standard Line Insurance Carrier, with Commercial Vehicle Insurance.
• Broward County requires all for hire vehicles to meet state requirements for insurance.

Editor’s notes: Companies, like Uber, have been threatening to pull out of Broward if this measure passed. Part of their argument was that the cost of doing business would increase so much that they couldn’t afford to stay in Broward. Balance those interests against the interest of protecting the users from all sorts of harm that is presently protected under the traditional Taxi business model and you might be able to see how beneficial the ordinance actually is. Protection from possible bodily harm caused by a driver, a car accident or getting stranded from a driver who doesn’t properly care for their vehicle would not exist without this ordinance being put into place. Worst case scenario, because that’s what lawyers always envision, another car rams into the vehicle you hired while you are “Ubering It.” You are taken to the hospital for serious injuries and you later find out that the driver of the other vehicle is uninsured AND the Uber driver is also uninsured. Exactly who pays for your visit to the hospital and the rehabilitation? Y-O-U. Yes, Uber is cheap, but always remember, you get what you pay for.

DISTRACTED DRIVER AWARENESS MONTH

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As we have mentioned before, we are delighted to share articles that may be of interest to our clients. This article, by our friend Steven Farbman, caught our attention and we felt it was worthy of your review.

Distracted Driver Awareness Month
by Steven Farbman, Esq.

For more than 30 years, The Law Offices of Steven S. Farbman, P.A. has been helping people who have been seriously injured due to the careless driving of others. Due, to the advent of the cell phone (texting) and display screens added to cars (GPS, radio, and even internet!) we have seen even more people of our community injured as a result of car crashes with distracted drivers. According to one recent survey distracted driving crashes in Florida increased 25 percent since 2012. Not surprisingly, April has become known as Distracted Driver Awareness Month.

While teens represent only 5 percent of licensed drivers, they were responsible for 12 percent of distracted-driving crashes. Drivers aged 20 to 29 were responsible for 31 percent of crashes.

There are three main categories of distraction: visual, taking your eyes off the road; manual, taking your hands off the steering wheel; and cognitive, thinking about anything other than driving.

Some of the most common types of distractions include:

*An object, person, or event outside the vehicle that diverts a driver’s attention away from the road
*Texting (put the phone away!!!)
*Reaching for a device, such as a GPS
*Interacting with passengers
*Eating or drinking (and never have alcohol in the car!!!)
*Unsecured pets
*Grooming (stop putting on your make up, shaving and brushing your hair while driving!!!)
*Adjusting stereo or climate controls
*Lighting a cigarette
*Daydreaming

Therefore, if you believe you may be guilty of some of the above distractions, make a concerted effort not to do them. Never take your eyes off the road! If you have young drivers in your family, go over the list and have them put the cell phone away until they reach their destination. Besides protecting others on the roadway, you just may be saving your loved one’s life and even your own.

The Law Offices of Steven S. Farbman are always interested in the safety and well-being for the people of our community. As always please feel free to contact my office with any legal questions you may have. For more than 30 years, Steven S. Farbman has been helping members of this community who have been seriously injured due to the carelessness and negligence of others.

CFPB releases ‘Know Before You Owe’ Shopping Tool Kit

Posted on by khaniauerbach

real estate, real estate closings, real estate transactionsThe Consumer Financial Protection Bureaus a/k/a the “CFPB” intends to roll out new guidelines and requirements for consumer home loans that will be in effect beginning August 1st of this year. They have kicked off their “Know Before You Owe” campaign by releasing a new toolkit to guide consumers through the process of shopping for a mortgage and buying a home.

“The new mortgage disclosure forms coming in August will help consumers comparison shop for mortgages and avoid surprises at the closing table. We are releasing this toolkit well in advance of the effective date to help the mortgage industry come into compliance with the new rules,” said CFPB Director Richard Cordray.

The toolkit, which can be found here, provides a step-by-step guide to help consumers understand the nature and costs of real estate settlement services, define what “affordable” really means and search for their best mortgage.

The Shopping Tool Kit also features interactive worksheets and checklists, conversation starters for discussions between consumers and lenders, and research tips to help consumers seek out and find important information.

Before the CFPB rule, the law required lenders to deliver two different disclosures to borrowers within three business days of receiving their applications. However, new guidance from the CFPB will now severely restrict how much a final mortgage deal can vary from from the original loan estimate.

In an effort to ensure compliance, the ‘Know Before You Owe’ loan documentation will consist of two new forms: the Loan Estimate and the Closing Disclosure to ensure compliance.

“Taking out a mortgage is one of the biggest financial decisions a consumer will ever make. Our new ‘Know Before You Owe’ mortgage forms improve consumer understanding, aid comparison shopping, and help prevent closing table surprises for consumers,” said CFPB Director Richard Cordray. The CFPB states further that the new documentation is intended to help improve consumer understanding, compare loan offers and avoid closing costs at the table.

At Khani & Auerbach, we are doing our very best to remain at the forefront of these changes.  We will continue to educate ourselves, our clients and real estate professionals that we work with in an effort to make these transitions as seamless as possible.   Click here for the downloadable .pdf file.

CMBS Loans: Lock Your Rate Before Its Too Late

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BenjaminsBetween now and 2017, over $300 billion in Commercial Mortgage-Backed Security, also known as Conduit Loans (“CMBS loans”) will need to be refinanced. What does this mean and why is it important?

Many of the current CMBS loans were made at the height of the real estate bubble, around 10 years ago and now, many commercial real estate owners find themselves in a bit of a pickle. What does that mean for commercial real estate in the South Florida? All classes of commercial real estate properties experienced some measure of delinquencies throughout 2014, but now, a handful of borrowers are faced with aging assets that they are unable to reposition. The reason for this, in many cases, can be traced to the growing demand of new and renewal tenants in multifamily, office and retail properties.

What does that mean for real estate transactions in 2015? It’s simple, if CMBS loans facing maturity continue defaulting at greater levels, rather than upgrading a property, these commercial real estate owners will be forced to replace financing on older properties. This replacement financing comes at a time when most secondary markets are experiencing competitive pricing along with demand for updated space. Rather than buying new properties, these developers and owners are taking measures to refinance these CMBS loans.

For now, interest rates continue to remain historically low, but this love affair with low rates may end soon, creating a quick cool off period for the real estate market. Low rates, along with other factors, such as availability of capital and relaxed underwriting standards, are forcing developers and owners to move quickly to lock in the most favorable rates.

Moral of the story: Lock your rate before it’s too late.

Khani & Auerbach is a law firm that focuses a majority of its practice on both residential and commercial real estate transactions. Contact us for more information.

Single Family Home Summary for Broward County – January 2015

Posted on by khaniauerbach

real estate, real estate closings, real estate transactionsSummary of Monthly Market Detail of Single Family Homes in Broward County for January 2015, provided originally by the Greater Fort Lauderdale REALTORS®.

Recently, the attorneys at Khani & Auerbach had the privilege of attending an industry meeting where they heard a representative from the Greater Fort Lauderdale REALTORS® group provide some insight on real estate changes in the Single Family Home market in Broward County. The changes were not significant, but definitely indicate a return to a healthy real estate market in South Florida.

While closed sales, cash transactions, new pending sales, average percent of original list price received and pending inventory have decreased from January 2014, there are some great statistics for Single Family Homes in Broward County that have increased. New listings, median sales price, average sales price, active listings (inventory) and months supply of inventory have all increased. Among the good news, the bad news is that the median days on the market have also increased by 28.9% since January 2014, up from 38 days to 49 days.

So, of all these statistics, you might be most interested to know 2 figures, Median Sales Price and Average Sales Price. The Median Sales Price for January 2015 was $265,000 (up 1.9% from January 2014) and the Average Sales Price is $342,106 (Up 1.1% from January 2014).

Overall, these indicators are a sign that the market is rebounding in a very healthy way, without too much decrease or increase in a short amount of time. The next data release from the Greater Fort Lauderdale REALTORS® is expected in on March 23, 2015.