I hope you all had a great Thanksgiving, despite the news that Rhode Island’s foreclosure rate during the second quarter of this year was the highest in New England, there is still a lot to be thankful for. In order to provide more resources and options to the thousands of people in crisis, Rhode Island Housing recently opened a help center to expand counseling services and is now offering a new loan product to Rhode Island that may help borrowers who are unable to pay their mortgages. This week we had Richard Godfrey, the Executive Director at RI housing on to talk about these programs.

My friend and past guest Nicolas P. Retsinas, director of Harvard University’s Joint Center for Housing Studies said “I give credit to Rhode Island Housing for not standing on the sidelines and wishing this problem will go away. The market will correct, but there will be collateral damage literally to thousands of homeowners. This is one small step.”

The Rhode Island Housing Help Center’s counselors are encouraging people who are having financial difficulties to contact the Center or their lender at the first signs that they might be in trouble. Counselors will assess each client’s situation and provide advice and education to help them:

1: Avoid losing their home or strategize to help cope with the loss of their home.
2: Make sense of their existing mortgage.
3: Make safe, informed decisions about finding an affordable rent or mortgage.

The counselors will also screen borrowers who may be eligible for “home saver loans”. The loans will enable eligible homeowners to refinance up to 100 percent of their houses value at more favorable terms than what is generally available through private sector lenders. “We don’t want to create false expectations”, Godfrey said. We’re guessing 1 in 10 people who call for help will qualify. The “Home Saver Loans” will offer:

1: Up to $374,000 for single-family houses and condos.
2: Up to $400,000 for two-family houses.
3: Secondary loans for up to 10 percent of the house’s value to cover closing costs.

To be eligible to apply, borrowers must live in the houses they own and meet the federal
Government’s definition of low to moderate income. The eligibility criteria would probably exclude homeowners who have significant debt beyond their mortgage or whose current mortgage exceeds the value of their house.

This Weeks Real Estate Insight:

Rhode Island Housing has been providing low-cost mortgages to first-time buyers since 1973. The Warren Group, ranked Rhode Island Housing as the State’s third-highest lender for house-purchase loans. During the first nine months of this year, the agency originated 388 of the 8,380 such loans made in the state.

Many of the richest people in the world have earned their wealth through real estate,  it is estimated that 80 percent of the world’s wealth is held in real estate and is owned by less than 20 percent of the population
Everyone wants to  retire comfortably and most of us have IRAs that typically invest in stocks and bonds. But a  decades-old form of investing is gaining in popularity as people search for creative ways to buy real estate. A self-directed IRA or IRA LLC enables you to choose what you would like to invest your money in — raw land, single-family homes, condominiums, apartments
 Despite a slow national real estate market, a recent survey showed real estate is the No. 1 choice for self-directed investors, Washington-based  Guidant Financial Group conducted a survey of nearly 1,000 self-directed IRA holders and found that nearly 65 percent of the respondents said they were considering property as an investment for their retirement savings
Nearly 60 percent chose rental property, more than 36 percent chose foreclosures and preforeclosures and more than 28 percent chose raw land.
The process of setting up a self-directed IRA or IRA LLC can seem overwhelming, so this week we spoke with have  Doug Miller, Senior Consultant with the Guidant Financial Group. Doug has coached thousands of clients on the self-directed industry using qualified experts to guide you through the process.
Guidant Financial Group is the premier provider of self-directed IRAs
helping people  to make investments in real estate, franchises, businesses, tax liens and more by accessing their retirement accounts without penalty before retirement age

This Week’s Real Estate Insight:

If you understand real estate investing, a self directed IRA with real estate in the portfolio can be a great investment decision.