FRESH START™ Frequently Asked Questions (FAQ’s)
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FRESH START™ Frequently Asked Questions (FAQ’s)
Q: When does FRESH START™ begin negotiations with the homeowner’s lender?
A: FRESH START™ will engage the lender in the effort to acquire the property within 30 days after they receive the package from the homeowner.
Q: What type of home is FRESH START™ intended to help?
A: FRESH START™ was created to assist homeowners with their primary residence and usually does not accept investment or commercial properties into the program.
Q: What is the typical physical condition of FRESH START™ home?
A: The home must be in Marketable condition and able to pass a standard home inspection as determined by an independent 3rd party appraiser. These appraisals are subject to both investor and secondary market review; therefore it must be determined to be in “average or good” condition by the independent appraiser. If an appraisal report comes in with questions, homeowner can ask for a second appraisal from a 3rd party appraiser. (Homeowner will incur the cost of a secondary appraisal).
Q: What type of customer is FRESH START™ intended to help?
A: FRESH START™ is intended to help homeowners who are upside-‐down on the value of the property. (The home is worth less than the principle value the homeowners still owes on the mortgage.)
Q: Who are the lenders that FRESH START™ typically works with?
A: FRESH START™ usually works with licensed conventional lenders FHA, VA, Fannie Mae, Freddie Mac; sub-prime, Negative Amortization and bank portfolio loans are acceptable for the FRESH START™ program.
Q: Who are the lenders that FRESH START™ typically does not work with?
A: Private lenders or hard moneylenders are not acceptable for FRESH START™.
Q: How accurate should individuals be when submitting financial figures?
A: It is imperative that all financial information given to FRESH START™ from the homeowners be complete and accurate.
Q: What home values are desirable for FRESH START™?
A: The current market value of the home should be at least 20% lower than the balance of the first mortgage on the home. Originating first loan or mortgage must exceed $100,000 and must be below $729,750.00.
Q: How is the current market value of the home determined?
A: Recent sales of properties comparable to your home are analyzed to determine the initial current market value of your home. Your real estate agent may have provided some of these to you to assist in this process. The final determining factor will be the Independent 3rd Party Appraiser’s evaluation and value.
Q: How far behind is the typical homeowner entering FRESH START™?
A: Homeowners entering FRESH START™ must be at least 60 days late on their mortgage payment. Fresh Start and its employees/referral partners CANNOT and NEVER advise anyone to miss a mortgage payment for any reason.
FRESH START™ and its employees/referral partners CANNOT and NEVER advise anyone to miss a mortgage payment for any reason. FRESH START™ is designed to help homeowners that have already fallen behind on their mortgage payments due to a financial hardship and cannot currently afford the mortgage payment on their home.
Q: What type of income is desired to enter FRESH START™?
A: The homeowners entering FRESH START™ can any documentable source of income that demonstrates they are capable of making the monthly FRESH START™ payment. Our internal Underwriters will determine the validity and acceptability of all income documentation provided.
Q: How is the FRESH START™ monthly payment calculated?
A: FRESH START bases the payment on the net present value of the home. Your representative will help you to determine the “NEW “fresh start” payment and if you verified income is sufficient for the “Fresh Start” program.
Q: What is the upfront fee for FRESH START™?
A: No upfront fees are charged for FRESH START™. The homeowner is responsible to pay for an Independent 3rd party appraisal (Approximately $450.00). Homeowner will be notified by FRESH START Housing Program of independent appraisal service and timing of appraisal. The appraisal takes place after homeowner accepts terms and conditions of acceptance package from FRESH START Housing Program.
Q: When will the details of FRESH START™ be disclosed?
A: All details of FRESH START™ are provided up front and in advance of signing any documents; after receipt of the FRESH START™ Application, your package will be underwritten for admission to FRESH START™. Each homeowner can review the terms of the proposal and accept or decline at their discretion.
Q: When should I discuss FRESH START™ with an attorney?
A: We advise our potential clients to consult independent legal counsel for any questions they have about their personal circumstances in relation to FRESH START™.
Q: How flexible are the terms of FRESH START™?
A: The homeowner must be willing to cooperate with FRESH START™ and all terms of the agreements to insure that negotiation with the lender is handled correctly. It is important not to interfere with the negotiation process.
Q: What happens upon acceptance into FRESH START™?
A: The client will receive a copy of the appraisal report and the lease agreement with the Acceptance Package. The appraisal report will reflect the market value of the home based on comparable sales in the area. In addition you will receive an Acceptance Letter into the program; you must sign and return these forms as instructed.
Q: When does a homeowner begin making monthly rental payments?
A: Monthly payments for the actual Lease begin at Close of Escrow (COE) and are due on the 1st of the month; if the escrow closes after mid-month than the 1st lease payment is prorated and the following months lease payment is also due at the close of escrow, your SPA account should have enough to cover these amounts.
The client will make payments to the Special Purpose Account 15 days after acceptance into the program to prove the ability to afford the home at current market value; this allows a payment history to be established which must be proven to the investor. Payments to your SPA are typically due the 1st of each month.
Q: What are the funds in the Homeowners Savings Account used for?
A: As stated the funds in the special purpose account are used for 3 purposes; 1st they prove to the investor that the customer will not have “payment shock” and they are willing and able to make the lease payments. Next, keep in mind that lease payments are due at the time the lease starts which is to say the 1st lease payment is due immediately upon close of escrow. Finally the funds in the SPA account equal 2 payments will be used as security deposit on lease.
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