How To Conduct A Short Sale Of Your Home

How To Conduct A Short Sale Of Your Home

If you are thinking about foreclosing on your home, you should consider doing a short sale first.  Filing for bankruptcy not only destroys credit, but let’s be honest here, it carries with it a certain stigma that is somewhat shameful.   Regardless, many feel this is the only option if upside down on mortgage payments.  But there actually is another option: a better option.

A short sale is an agreement between the lender and the borrower in which the lender agrees to accept half the total amount do.  Lenders will complete short sales for a few reasons.  First off, they will no longer have to chase borrowers for payment.  Second, they will avoid the costs and troubles of foreclosing on the property.  Though some lenders will not consider a short sale, borrowers should definitely inquire before agreeing to foreclose.

If a short sale sounds right for you, the first thing you must do is contact the lender and suggest the idea.  If he agrees, call a real estate lawyer and inquire about the legal ramifications of following through with the short sale.  Finally, reach out to an accountant and ask about possible short sale taxes.  So before you even consider foreclosing, make sure to question the lender about a short sale.  You’ll save yourself time, money, bad credit, and a heck of a headache.

Obama’s Loan Modification Program Under Fire

Obama’s Loan Modification Program Under Fire

In an effort to help with their mortgages and keep homeowners from foreclosure, President Obama has instituted certain government loan modification programs.  While thousands of people have benefited from the programs, there are still a multitude of problems with the government’s plans.

Class action lawsuits are currently being filed against various banks for their seeming unwillingness to work with borrowers on the verge of foreclosure.  Some borrowers swear that their banks are going as far as ignoring their phone calls or letters.  But why are the banks unwilling to work with the borrowers?  For one, banks will make more money if the borrowers are forced to foreclose then if they work with borrowers on a loan modification plan.

And so now, lawmakers are searching for ways to encourage banks to work with the borrowers.  Some plans are offering incentives to the banks.  Other plans include penalizing banks who are ‘ignoring’ their borrowers.  Though Obama’s plan is a start, it’s not the final solution, and only when the banks are forced to cooperate with the borrowers, will a solution be viable.

Short Sale Deficiencies

Short Sale Deficiencies

The California Legislature recently enacted Senate Bill 931 generally prohibiting a deficiency judgment after a short sale for first trust deed lenders of one-to-four residential units.  The following charts are easy-to-use reference guides for REALTORS® and their clients to determine the general applicability of anti-deficiency rules for short sales and foreclosures.  These charts do not cover all aspects of any individual case or situation.

Short Sale Deficiencies Fact Sheet

General Rule	Unless otherwise exempt, no judgment shall be rendered for a deficiency for a first trust deed lender of one-to-four residential units if the borrower sells for less than the amount owed with the lender’s written consent. A first trust deed lender’s written consent shall obligate the lender to accept the sale proceeds as full payment and to fully discharge the remaining debt on the first trust deed.
Effective Date	January 1, 2011
Applicability	First deed of trust for a dwelling of not more than four units.
Exceptions	Exceptions include: Junior liens Lender seeking damages for fraud or waste; Borrower is a corporation; or Borrower is a political subdivision of the state.
C.A.R. Standard Form	C.A.R.’s Short Sale Information and Advisory (Form SSIA) paragraph 4A2 discloses this law to sellers and buyers.
Practice Tip	Regardless of the law, it would be prudent for a borrower to obtain the lender’s agreement to release the borrower from liability for the balance due on the note in writing and signed by the lender.
Legal Authority	The full text of SB 931, which adds section 580e to the California Code of Civil Procedure, is available at http://www.car.org/legal/2011-new-laws/.

Short Sale v. Judicial Foreclosure Homeowner (1 to 4 units) Generally Protected Against Deficiency

Type of Loan	After Short Sale	After Judicial Foreclosure*
First Trust Deed	Yes	Yes, if purchase-money and owner-occupied
Second Trust Deed	No	Yes, if purchase-money and owner- occupied
Purchase Money Loan	Yes	Yes, if owner-occupied
Rate-and-Term Refinance	Yes	No
Cash-Out Refinance	Yes	No
Owner-Occupied Home	Yes	Yes, if purchase money
Nonowner-Occupied Home	Yes	No

*Note: Certain exceptions may apply, including wiped-out junior liens, fraud, and bad faith waste. Also no deficiency judgment shall be rendered if a lender forecloses by trustee’s sale (CCP § 580d) or if a loan is seller-financed (CCP § 580b). See C.A.R.’s legal article entitled Deficiency Judgments and California Law, available for C.A.R. members at http://qa.car.org.

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This chart is just one of the many legal publications and services offered by C.A.R. to its members.  For a complete listing of C.A.R.’s legal products and services, please visit www.car.org.

Readers who require specific advice should consult an attorney.  C.A.R. members requiring legal assistance may contact C.A.R.’s Member Legal Hotline at (213) 739 8282, Monday through Friday, 9:00 a.m. to 6:00 p.m. and Saturday, from 10 a.m. to 2 p.m.  C.A.R. members who are broker-owners, office managers, or Designated REALTORS® may contact the Member Legal Hotline at (213) 739 8350 to receive expedited service.  Members may also submit online requests to speak with an attorney on the Member Legal Hotline by going to http://www.car.org/legal/legal-hotline-access/.  Written correspondence should be addressed to:

CALIFORNIA ASSOCIATION OF REALTORS®
Member Legal Services
525 South Virgil Avenue
Los Angeles, California 90020

*** This information has been provided by the California Association of Realtors legal department. Housing Assist of America does not offer tax or legal advice and recommends homeowners to consult with their tax preparers and attorneys before making any decision regarding their properties.

Mortgage Modification Scheme

The Rise & Fall of the Mortgage Modification Scheme

Joshua Anderson, Lexington Realty Chief Correspondent, Los Angeles, Ca

Friday, February 18, 2011

Los Angeles- We have all heard the horror stories, desperate homeowners paying thousands of dollars to so called modification specialist, in hopes to save their homes, only to find out they were victims of fraud. Julio Salazar of Falls Church, Va, knows this all too well. When the economic crisis caused his hair-cutting business to plummet last March, he became desperate and was willing to do anything to save his home. That’s when Miami based “Friendly Financial Services” solicited Salazar for a permanent loan modification. He was immediately coaxed into paying a $2,300 attorney fee in exchange for the modification. He was told that CitiMortgage and One West Bank would be contacted by the firm’s attorney, this never came to fruition.

According to the state laws in Florida, homeowners are never supposed to pay upfront fees for modification and as a result of thousands of complaints, a federal ban on collecting upfront fees went into effect on January 31^st. Frank Dorman, who is a spokesperson for the Federal Trade Commission, said that “loan modification scams have increased with the recession to take advantage of increased foreclosures.”

When a homeowner has exhausted all of their options there is little to do to salvage the situation. One increasingly popular solution is to short sale. www.housingassist.com provides in depth solutions to short sales and has a proven track record of success, and best of all there are no fees involved whatsoever. It is the responsibility of the homeowner to do their due diligence on any company before they hire them. In the case of Salazar, he was lucky to have his foreclosure stopped, but not without yet another financial loss.

The Truth Behind the Real Estate Market Recovery

Joshua Anderson, Lexington Realty Correspondent, Los Angeles

Los Angeles- While over 100,000 delinquent homeowners flocked to the NACA convention over the past week to get their mortgages modified, only about 30 percent of them were successful. The growing number of foreclosures in California is increasing dramatically and there are absolutely no signs of a slowdown.  Disgruntled homeowners left the convention looking as hopeless as they did upon entering. What lenders are not disclosing to the public is that their efforts to foreclose have been stepped up; misleading homeowners who still believe the mortgage modification program will benefit them. One woman left the convention stating that last time they were in town, about 90 days ago, they told her she would qualify the next time around, only to find out she was denied yet again.

Amidst the crisis the number of homeowners who are “underwater” has surged to 27 percent, up from 23 percent before the fourth quarter of 2010.  The situation is dire and experts predict that it will only get worse.  There are still a few homeowners who believe a temporary modification will solve the problem, but as the economy continues to decline, that possibility will soon fade.  The mortgage foreclosure moratorium has spotted several loans with faulty paperwork, but this will not solve any immediate problems and those who are delinquent will remain on the chopping block.  The overall situation could potentially regain itself within the next five years but the countries deficit puts that figure at risk. “Home value trends in the fourth quarter remained grim, but the good news is that these declines, while painful in the short-term, mean we’re getting closer to the bottom,” said Zillow’s chief economist, Dr. Stan Humphries.

Across the nation the foreclosure figures are devastating. In Albuquerque , New Mexico, one in 46 homes are being foreclosed on, which is an increase, in 2010 it was at 60.32%.

Other hard hit cities include Spartanburg, S.C., Myrtle Beach, S.C, and Savannah, Ga. Of course the larger metropolitan cities have been devastated as well with the more affluent communities like Bel Air and Beverly Hills remaining stable.

In a small effort to stabilize the housing market the Obama administration released information regarding the reform of Fannie Mae and Freddie Mac. The exact details have yet to be released but the majority of the information was in regards to the government greatly reducing its role in the mortgage market.  The Republicans have made it clear that they would like to accelerate this plan; however experts have estimated at least five years.  There are reports that Fannie, Freddie and FHA loan limits will reduce from $729,750 down to $625,000. There is nothing solidified as of yet but these may be some of the changes that will take place in the near future.

In lieu of the deplorable mortgage crisis there is one short term solution that will benefit everyone in the long run, short sales.  The process in which a lender accepts less than what’s owed on the mortgage and generally releases the homeowner of liability upon the closing of the short sale. The Home affordable foreclosure alternative or simply HAFA, is the latest in programs that benefit the homeowner with a $3,500 relocation assistance fee. Housing assist of America, a Los Angeles based firm handles these short sales in bulk and says that they have a solid system that works and it procures favorable results for all parties involved. Their site www.housingassist.com provides an in depth look into what the actual approvals look like from various lenders including BofA & Chase.

The problematic mortgage market will continue to falter as the years come, but the bottom may also be getting closer, this will eventually lead to a full recovery. But there is a lot of work that has to be done, and not just by the banks.

Los Angeles Short Sale Realtor

Are you looking for a Los Angeles Short Sale Realtor?

If you are considering a short sale realtor or agent in the Los Angeles, it is important to make sure you know that your realtor or agent understands short sales like the back of their hand.  A short sale is a complicated transaction that can take anywhere from 3 months to a year to complete.  Make sure the short sale realtor you choose in los angeles is fully equipped to handle the transaction.  The experts of Housing Assist make sure that your file is handled with urgency because we understand that these are peoples homes we are dealing with and not just commissions.  Work with a company who has completed over 500 successful short sales.  We are here to help you at No Cost.  Please feel free to give us a call at (888) 877-0078.

1 Million Homes Reposessed

1 Million Homes Reposessed in 2010

The number of foreclosures that we saw in 2010 was astronomical.  There were over 1 million people who lost their home! Realtytrac reported close to 2.9 million foreclosure notices.

Nevada has led the pact with foreclosures for the fourth year in a row.  One in every 11 homes received a foreclosure filing.

Overall, 2010 was a rough one for the mortgage industry. The big news was the robo-signing scandal, which erupted in the fall amid allegations that banks were foreclosing on homes without having read the documentation.

In the first quarter of 2010, eyes were still focused on Obama’s HAMP program, while many analysts were still optimistic about saving their homes.  But as time progressed it was quite obvious that the HAMP program was losing the fight against foreclosures.

Then the next shoe to drop came in June, with a report from Fitch Ratings that showed HAMP modifications re-defaulting at a high clip. The company forecast that three-quarters of all HAMP mods would ultimately fail.

The next few years are looking to be very difficult on the economy and the housing industry.   Some industry analysts, such as Laurie Goodman, head of Amherst Securities mortgage group, say that as many as 11 million mortgage borrowers are in potential danger of default.

However, Rick Sharga, RealtyTrac’s spokesman, predicted 4 million to 5 million and scoffed at quantifying the magnitude of the potential disaster, comparing it to “taking inventory of deck chairs on the Titanic.”

Only time will tell, but if you have any questions regarding your home and the position you are currently in, feel free to call us at 888-877-0078.

Disheartening News For America

Very Disheartening News for America

The more news articles I read regarding the US economy, the more I realize the average American is drowning (and tethered to a sinking house). Lets start with headlines from today like “Obama’s Mortgage Mod Plan is Still Lacking”. This article from CNN Money explains that while $30 Billion was set aside for HAMP to help struggling homeowners stay in their properties, only $4 Billion will end up being used for this purpose. Instead of saving an estimated 3 million to 4 million peoples home, they now project a total of 700,000. Why, you may ask? For the same reason these people are in this position in the first place, the benefit of Corporate America. It’s plain and simple. Wall Street greed caused this mess and its perpetual greed is keeping America here. Instead of writing down loan balances and offering REAL and sustainable plans for people to keep these properties; the executives at the top plan to foreclose on every one of them. And they are laughing all the way to the bank!

Here are a couple other headlines from CNN Money today, “Wealth Gap becomes Chasm at Christmas” and “Wall Street Bonuses May Top Last Year’s as Earnings Soar”. So basically the rich are continuing to get richer as the average Joe is slipping deeper into negative net worth with their underwater properties. The middle class is getting completely wiped out and we will be left with a very small minority of Super Rich and a large majority of Super Poor. The government could stop this but unfortunately is under Wall Street and Corporate America’s thumb.

We at Housing Assist of America have made it our business to help these homeowners that are drowning in negative equity with ridiculous mortgage payments. Our job is to fight the banks on behalf of the homeowner to allow a Short Sale. We negotiate with lenders like Bank of America, Wells Fargo, Chase, and many more to forgive these homeowners for their debts. Our clients are able to walk away and start fresh while planning a road to economic recovery. Housing Assist of America lays out a plan to repair credit and buy a home at a reasonable price. We do not charge for our services and we have a greater than 85% success rate. We are so skilled that hundreds of real estate agents contract us to negotiate on their short sales on their behalf.

Isn’t everybody FED UP with the current situation? Please contact us at Housing Assist of America to find out how we can help you. I look forward to hearing from you.

Innocent Bystanders

Innocent Bystanders

Monday November 29, 2010 at 12:00 pm PST by Joshua Anderson, Lexington Realty Correspondent

Los Angeles—We have all heard the stories, a once vibrant neighborhood goes to the dumps because every other house on the block is either bank owned or currently in foreclosure. Everyone looks around and points fingers and asks who’s to blame?  Well from the top we of course by default blame Wall Street, the banks and the government. But by taking a more in depth look at the whole scenario, we realize there were a chain of events that eventually lead us to where we are today, and the unfortunate outcome, are those who suffered because of someone else’s mistakes.

Take 60 year old Sherrilynn Palladino, a ten year homeowner in the California community of Grover beach.  A responsible borrower who never missed a payment, Palladino could only stand by and watch as the price of her home plummeted until it was too underwater to do anything about it. This scenario had been played out over a million times in thousands of communities across the nation. It’s almost like a domino effect, one block falls, and sets off a chain reaction. Palladino had dreams of selling her home and cashing out. A home with good equity would have made for a secure retirement, but instead, the values declined. Between all of the underwater mortgages and rising rates, foreclosures were inevitable. In the case of Palladino though, she never missed a payment, even after being laid off from her job as an administrative assistant. Unlike her situation, most families could not afford to salvage the basic necessities just to keep up with the mortgage payment. This is where the real trouble began. Almost everyone who had an adjustable rate mortgage was bound to default at some point or another, and just as it was predicted, they did. On top of the defaulted loan, many homeowners lost there jobs, thus creating an even deeper financial burden.

Now that we are somewhat nearing the tail end of this foreclosure mess, we need to have a better understanding of what got us here in the first place. Prices will still drop for the next couple of years and lenders are stepping up there foreclosure efforts. So before the smoke dissipates there will be even more collateral damage. Sherrilynn Palladino was just one case, but there are thousands more just like her. One of the best things you can do in a situation like this short sale. The process allows you to alleviate the negative debt and does minimal damage to your credit, pending your not severely in default. Upon completing the short sale you may be entitled to up to $3,500 from the Obama driven HAFA program. The benefits are endless; however the most significant is avoiding foreclosure. After just 18 months the homeowner can be eligible to take out a new home loan and take advantage while prices and interest rates are still historically low.

Being a victim of this housing crisis doesn’t mean you need to be a casualty, in many cases it takes risk and a small amount damage to rectify the situation, but in the end it may be worth it.

Obama Advocates Foreclosure

Obama Advocates Foreclosures

By Joshua C Anderson, Lexington Realty Correspondent November 14, 2010 3:39 PM PT

Los Angeles—The housing market has been jolted by several failed attempts to recover and the only solution at this point, seems to destroy and rebuild.

In the midst of the month long foreclosure moratorium, harsh decisions had to be made. Obama administration officials stated that all lending and servicing institutions needed to review there foreclosure policies and procedures, this however did not result in a mass of homeowners getting out of trouble. The officials made it clear that they did not support the moratorium for several reasons. One main point being that the housing market wouldn’t return to normal without foreclosures.

A stable market in the future does not come without consequences. The continuation of foreclosures will not only hurt the housing market, but it will also have an adverse affect on the overall economy. The Mortgage modification program was supposed to lower homeowner’s monthly payments by 31%. The program was a complete failure and many homeowners have been misinformed.  Laurie Goodman of Amherst Securities said in a statement, “What they have now realized is there are a lot of borrowers who can’t be saved and have to be moved through the foreclosure process.”

This will be a hard fact to address to the American people. There will be a lot of animosity and many will feel left out. There are however, alternative options to foreclosure. The most popular and less damaging is the short sale.

Southern California based Housing Assist of America has made quite an impact on the short sale market. They are among the nation’s best negotiators and have over a 90% percent success rate. Typically in a short sale the lender will accept less than what you owe on the property and in most cases forgive the left over balance. The consequences are significantly less detrimental to the homeowner’s credit and financial situation than that in a foreclosure. Housing Assist of America has recently made an alliance with tax powerhouse H&R Block. Together, they educate at risk homeowners on short sales and tax ramifications. There scheduled to host a free seminar next week in Culver City, a hard hit  suburb of Los Angeles. As the foreclosures in the nation increase so do the opportunities for scammers. When the loan modification wave hit, several fly by night firms starting collection retainer fees from homeowners, only to yield no results. Other signs to watch out for include companies that promise results and charge an upfront fee. Banks do not charge there clients to modify or short sale there homes.

In this vulnerable time it’s important to be vigilant to what your options are. The government has made it clear that foreclosures will continue and everyone who falls into that category will inevitably fall into it, one way or the other. From a homeowner’s perspective, the best option is to accept the demise and seek out the best exit strategy. For those who are still holding on to hope or speculation, this message from the top should clearly define the future housing forecast.

“As we near the end of 2010, the housing market remains fragile, and has recently come under renewed pressure from slowing economic growth, weaker employment and foreclosure uncertainties, We believe that it will be a considerable time until the housing market has a sustained recovery.” A chilling statement from Freddie (FMCC) Mac CEO, Charles Haldeman.

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