Approved Short Sales

Approved Short Sale

If you are shopping for a home and see the term: Approved Short Sale on a real estate listing, the chances are that it may be a relatively good deal.  There are very few listings that are actually Approved Short Sales because the only way that they become approved is after a hardship qualification, appraisal, and the acceptance of an offer.  The property is on the market again because the original approved buyer fell out of escrow usually because of the very long wait time.  The trick in clinching these is to find out what the approved price was from the listing agent, and submit an offer in the price range.

Most listings will be listed as Short Sales, while only a very small percentage will be listed as approved for short sale offers. Most of the time agents and/or their clients mistakenly believe that once they get an offer the lender will then take them seriously, approve a short sale and forgive them for any deficiency left over.  This is a very risky strategy as the lender has to first verify a borrower’s stated hardship with tax, bank assets, and earning statements, etc.  After that they will do an appraisal of the property and approve a price.  But before everything, they have to determine that it will be less expensive to sell short rather than sustaining the costs of foreclosing, taking possession, and trying to sell it themselves.  Only then is it approved for a short sale status and they are open to looking at offers.  This can take up 3 to 5 months and most buyers don’t have the patience for that kind of wait time; especially in today’s buyer’s market.  This is the primary difference between short sales and approved for short sale offers.

 

If you are behind on mortgage payments or foresee that you will be behind, you should consider contacting your lender directly and consider a leader in the industry execute a successful short sale.  Do it the right way the first time and get it done in the quickest manner possible.  We have almost all of our short sales approved in contrast with the very high failure rate amongst most realtors who aren’t specialist.  You owe it to yourself to find out why.

For a quick response, please fill out the input fields under “Contact Us for a Free Evaluation” at the upper right.  Please give us the best number to reach at as we can only do a consultation by phone and will email all support documents after the call. To view a list of short sales click here.

Avoid Foreclosure

How To Avoid Foreclosure?

Well there are a number of ways for homeowners to avoid foreclosure.  I’ve posted several blogs in our archive that shows you exactly how you can do this.  If you want to speak to me personally you can call 323-677-2800, and I will be more than happy to help you.

The government has allocated $400 million which was used to help homeowners avoid foreclosure, by lowering their monthly mortgage payments.    A study has been released stating that borrowers are about 60% more likely to keep their homes if they receive some type of counseling.

Borrowers facing foreclosure are 60% more likely to hold onto their homes if they receive counseling. So here is a simple equation I put together:

Counseling = Stay In Home

Get it?? Then go get some help and avoid foreclosure!!

In particular i would use Housing Assist of America or the National Foreclosure Mitigation program, these are two institutions that have helped homeowners avoid foreclosure.   More and more homeowners are becoming delinquent on their mortgage payments, and this is not a problem that we are seeing an end to any time soon.  So please take my advice and get some help immediately.  Don’t trust a realtor or attorney, because at the end of the day all they want is your money.

Go get help from a counselor who does not charge anything for their services, and avoid foreclosure today!!

Short Sale Properties

Where can buyers find short sale properties?

There are several great deals out there for anyone who wants to buy a short sale property.  This is the perfect time to invest as property values won’t decline much more than they already have. To see a library of great short sales click here .

Tax Credit Extended

Okay, so I know that many of you homebuyers were frantic whether or not you were going to find a home in time to utilize the first time homebuyers tax credit.  The new legislation that was passed, pushed this tax credit to April of 2010.  President Obama, signed the law on friday known as “Worker, Homeownership and Business Assistance Act of 2009″.  This law has extended the first-time homebuyer tax credit in a dismal time when unemployment has reached as high as 10.2%.

This tax credit has expanded to 10% of the purchase price of the property and must be in contract before midnight on April 30, 2010. According to the IRS, “the credit has provided more than 1.4 million to taxpayers as of September 2009.

The credit is now offered to those with incomes up to $125,000. Anyone who does not fall into this category is not eligible for the tax credit.

This bill was passed by The House of Rep.’s on Sept, 2009…331 votes for and 83 against…But it’s funny how they keep extending the date.  Of course the tax credit is going to incentivize people to buy homes, the government clearly wants buyer activity to help clear up the foreclosure mess.  They wanted to stir up a lot of activity so buyers thought they didn’t have all the time in the world to purchase, and just as we came down to the wire they extend the tax credit.  Funny don’t you think?

Deed For Lease Program

Deed For Lease Program

So what’s the fuss?  Fannie Mae is letting homeowners stay in their homes and rent them for up to one year. This will help stop a copious amount of foreclosures.  The deed for lease program is offering borrowers who were unable to qualify for a modification or any other workout plan, to deed their property to the lender while still allowing them to live in the property as a lease.  Generally speaking the deed for lease will be a lower payment than their actual mortgage payment.  Borrowers will pay market rent and have the ability to stay in the property.

This is beneficial to the borrower for saving the time and energy of moving out of their home, and helps the banks keep people in their homes in hopes for values to rise over the next year.   We are still uncertain of how many homeowners Fannie Mae is willing to offer the Deed to Lease program, but nonetheless it will sure help out a good amount of homeowners.

This program will not be offered to homeowners who have not been behind on any payments.  It is evident that Fannie Mae would love to hold on and sell these properties at a higher value.  I’m sure that the deed to lease program is inspired by Freddie Mac, who was offering their clients month to month leases to people who had lost their homes in foreclosure.

7 Ways To Stop Foreclosure

Here are 7 ways to Stop Foreclosure:

If you have not missed a payment yet, but know you are going to, the first step is to contact your lender and let them know your situation.  If you’ve lost your job or have some other type of hardship going on let them know.  They can give you time to help  get your life back together, but you must call them as soon as you know you’re going to miss a payment. The longer you wait until you actually miss your payment, makes it more difficult to ultimately get the problem solved.

Ask for forbearance. This allows you to delay payments for a short period of time, with the understanding that another option will be used afterward  to bring the account current.

Ask for a repayment plan. This is where the lender agrees to add a certain amount of the first missed payment onto each of the subsequent two payments.  These plans provide some breathing room for you if you only have short term financial problems, such as a sudden expensive repair or medical expense that makes it too difficult to pay your mortgage one month.

If you have already missed 2 or 3 payments and owe a couple thousand dollars in lender legal fees, the lender of your mortgage may still try to arrange a repayment schedule.  But you will likely have to pay a third to a half of the delinquent amount up front, and then pay off a portion of the remaining balance each month for a year or more.  Also, never ignore the lender’s letters or phone calls. Ignoring the problem won’t make it go away- and if you’re going into a foreclosure process, there are other fees and costs involved and ignoring them only makes these worse.

You may also be eligible for a loan modification plan, designed for people who can’t afford repayment plans.  In a modification, the lender actually adjusts the terms of the loan to make it affordable. It may lengthen your amortization schedule or lower the interest rate to cut the monthly payments, or roll the past due amount into the loan and re-amortize the new balance so you can pay the additional debt back over time.

Some companies may be willing to offer you a “short refinance” too.  With these, the lender agrees to forgive some of your debt and refinance the rest into a new loan.  This way, teh lender still gets more money than they would by foreclosing on you.

A Deed in Lieu of foreclosure is an option in which you voluntarily deed your property back to the lender in exchange for a release from all obligations under the mortgage. Unfortunately, there is no way to do this without hurting your credit, unless you get the mortgage company to report your mortgage account as paid in full.  You may face income tax issues resulting from the lender forgiving part of the debt, but you might be able to get yourself out of the hole and start over again sooner rather than later.

If you can afford your normal monthly payment, but can’t afford to make up the delinquent amount and legal fees because your lender offered a really harsh repayment plan, you may want to consider filing Chapter 13 bankruptcy. Doing so temporarily halts the foreclosure process and can force the mortgage lender to accept a more friendly repayment plan.  This is a last resort, and will still negatively affect your credit.

If none of these strategies work for you there is still one option which is a short sale.

Housing Crisis

Educating Homeowners On The Current Housing Crisis…

What’s going on right now in our countrywith so many homes going into foreclosure is due to outrageous loans made to almost anyone who could cause a mirror to fog up.  In different parts of the country, many lenders even committed fraud by placing higher value on homes than they were worth, simply to inflate the amount of the loan needed by the homeowner, which in turn would boost their own profits.

The fear of the U.S. subprime mortgage market have triggered a global credit crunch, playing havoc with Wall Street stock portfolios and dragging down global markets.  In case you are not familiar with the term, subprime loans are offered at higher interest rates, and usually on adjustable terms, to Americans who have poor credit rating and might otherwise be denied loans. But as interest rates have risen, so do those adjustable payments, leaving many homeowners stretched beyond their means. You or someone you know may be facing this right now.

How To Do Short Sales

How to execute a short sale properly?

I am going to share with you the secrets that my company uses to get successful results.  In efforts to short sale a property successfully you need to do the following:

• One needs to explain to the seller that they are getting out of a terrible situation, and that a short sale will get rid of any negative debt they may have.
• One needs to market this property to buyers  who are looking for good deals in this type of market

• One needs to explain to lenders that they will make more money via a short sale as oppose to an auction

The buyer will want to make sure that they are getting this property at the lowest possible value and that this value will be approved by lenders.  In this case the seller receives no cash yet rids their debt, so all parties involved are winners.

There are a couple of things to consider as a buyer in a short sale transaction:

• You want to find a buyer that is under water with their home loan.
• You want to make sure there are no judgments against the property.
• As a buyer you want to make sure that the seller is cooperative, because without their cooperation you will be facing a difficult transaction.
• The price you are paying for this property will gain you instant equity.
• As the buyer you should make sure that the seller is facing a true hardship

To sum this all up you need to find a homeowner who is in foreclosure or will be, and line up the right buyer, then you negotiate with the bank to accept the offer in on the property.

Contributing Factors of the Recession

What Caused This Recession?

Of course, the banks contributed by making mortgages far too easy to acquire, and exercising little to no scrutiny over loan applicants, which led to bad mortgages running rampant.  It is easy to understand how this could happen when you take into account that charging applicants high fees, high pre-payment penalties, and the maximum allowable interest rates was all part of the lenders scheme to make as much money as possible from so many borrowers.

Further fueling this real estate frenzy were people, without any of the guidance, speculating in real estate. They saw home prices appreciating and decided to jump in for a quick buck.   With certain markets driving prices up tens of thousands per quarter, these inexperienced would buy new homes during pre-construction and even put together financing for sight unseen real estate purchases-all with the intent of selling before they ever had to make their first mortgage payment.

Banks would make poor loans and then sell these loans to other financial institutions and investors for profit.  Can you see how the incentive was to keep making more loans as fast as possible?  Risky mortgages were bundled into securities and sold on Wall Street.  Big funds, obsessed with getting a higher rateof return, ignored the risks.  These factors, followed by a lack of attention by the Federal Reserve, resulted in the creation of a “perfect storm”- and when the storm finally hit, it was an economic tsunami.

Getting a Notice of Default

I spent the next 3 hours calming my neighbors down, and explaining to them what options they have and how a  Notice of Default does not mean they are being foreclosed on.  It makes me feel good that they phoned me and understand what is going on.  Believe me when I say, I understand that these are unstable times, and to receive a NOD could feel like the end of the world.

I assured them that in their particular situation a short sale would be their best bet.  They have been my neighbors for the past 3 years so the trust was already there.   So here we go with yet another short sale…I have helped find my neighbors a property to lease that is equivelant in size at a fraction of the cost! I’m tired and need some rest as this is the 48th short sale my team and I are currently working on.  Give me a ring if you need any personal advice or help on your property, there will be no BS coming from me, nor do I charge for any of my services.  Until my next blog, I wish all of you the best.

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