Edith Lank - Column by Edith Lank

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House Calls: HARP Loan

Edith Lank

Edith: What is a HARP loan? I have a town home that has depreciated since purchase price. I am current on all bills and mortgage payments, but I would like to find a way to get a lower rate. -- e-mail

Answer: The acronym stands for the Home Affordable Refinance Program. It allows certain homeowners to refinance into a new low fixed-rate mortgage, even borrowing a bit more than their home's current value. It's available for borrowers whose mortgages have been bought by Fannie Mae or Freddie Mac, the two large organizations on what is known as the secondary mortgage market. The program is intended for borrowers with good payment records.

You can find out if your loan is owned by one of those companies by searching these websites: freddiemac.com and fanniemae.com.

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ONE OF FOUR OWNERS

Dear Edith: If my name is one of four to a house, can I force them to buy me out or sell in order to get my name off the deed? -- K.

Answer: You can go to court and request an order for "partition" -- a public auction sale of the property and division of the proceeds. That involves legal expenses and seldom yields true market value. Everybody loses. Perhaps a letter from your lawyer, mentioning the possibility, would be enough to move your co-owners to cooperate.

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JOINT TITLE, JOINT LOAN

Dear Ms. Lank: My ex and I own a home with a joint title and joint loan, and I want out. How do I make that happen? -- R. W.

Answer: There's good news and bad news. Getting out of joint title is easy. Getting out of joint loan may not be as easy.

You can sign a deed turning over your share of ownership to your ex. He or she then owns the whole property.

It's not so simple, though, to get out of responsibility for the mortgage loan, even after you no longer have any claim on the property. Perhaps your ex will refinance in his or her name alone. Otherwise, sometimes the lender will release you if your ex is financially qualified and has been making the payments. Sometimes, though, they won't.

In which case -- you're stuck. The entire loan stays on your credit record as your debt. If payments aren't made, those problems show up on the record as well.

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INSPECTING FOR AS-IS HOMES

Dear Edith: If a property for sale says "strictly as is," and you put in your contract "contingent on a home inspection," are they likely to accept it, or would they only take a contract without this stipulation? -- S. A.

Answer: I can't predict what any seller will accept in your written offer. I can tell you, though, that "as is" means you're giving up the right to object to any problem you knew about when you bought. (It does not, by the way, automatically protect the seller if undisclosed defects later turn up.)

If I were buying "as is," I'd certainly want to know exactly what I was taking on, so I'd make my offer subject to a satisfactory home inspection. That would actually benefit the seller, because once I knew about a problem, I'd be on record as having accepted it.

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SELLING AFTER LISTING

Dear Edith: I listed a two-family home with a broker last year and had a buyer. When we could not agree on terms, it wasn't sold and the listing expired in July 2008. In May 2009, the buyer called my attorney and said he was still interested in the property at a lower price. OK, so I got a different broker. It was my understanding that I could not sell to this buyer without a broker because I would owe the first broker her commission; we had a falling out over the way the deal went down.

Now I find out I could have sold the property directly to the buyer without any commissions. True or false? I have still not signed accepting the offer and my contract with the second agent has expired. He didn't really do anything as I already had that buyer. I don't want to cheat anyone of money, but it's costing me lawyer fees. -- e-mail

Answer: There's an old saying: "When all else fails, RTFM -- read the manual!" And in your case, it's "read the listing contract." When you signed it, you promised to pay a commission under certain circumstances. Often the contract explains whether you'd owe a fee if you later sold to someone who first saw the place while it was listed. That usually applies for a certain number of months after the listing has expired.

You could have seen that with your first listing, and it's probably set out in the written agreement you have with the second agent. Look it up for yourself.

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Edith Lank will respond personally to any questions sent to her at 240 Hemingway Drive, Rochester, NY 14620 (please include a stamped return envelope), or readers may e-mail her at ehlank@aol.com.

Copyright 2009 Creators Syndicate Inc.

This news arrived on: 10/04/2009

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