buying a short saleBuying a short sale – Are you a homebuyer looking to buy a short sale home at a great price in today’s real estate market? In a short sale, the current homeowner owes more to the bank than the home is currently worth, so he or she is underwater on their mortgage. For example, Joe Smith has a mortgage of $500,000 but his home is now only worth $300,000 in today’s housing market. So Joe can choose to Short Sale his house, and...more
We wanted to share this audio report from an LPS asset manager who has some fantastic first hand knowledge of the REO market and the new REO inventory that's on it's way this year. LPS reports the national delinquency rate hit 8.15% as of last month. A few months ago, we reported to our members that foreclosures had been drying up due to default reviews, loan modification attempts, and new state and federal regulations, and...more
No one wants to find themselves upside down on their home loan, especially if they are struggling to pay their monthly living expenses like utilities, groceries, and the mortgage. Sadly though, this is a reality for many Americans. If you’re one of them, then we want you to know that EZ Short Sales in New York is here to help.
You never expected to find yourself in this situation, so it’s no surprise that you feel unprepared to start...more
For homeowners looking to sell their houses quickly and help cover their outstanding mortgage, knowing where to go to get the quickest sale possible can prove challenging. While finding a buyer shouldn’t be that complicated on the surface, there are so many moving parts to any kind of real estate transaction that the inexperienced can quickly become overwhelmed by the process. Having an experienced short seller on your side can help you make...more
The foreclosure process on your home can prove a challenging and overwhelming experience. With the stress of the thought of potentially losing your home mounting, if you go at it alone, you miss out on taking critical actions that could have helped you navigate the situation. Unless you are well versed in the state laws involving foreclosures and your rights, an experienced foreclosure attorney, like those found at EZ Short Sales, can help...more
Paying the mortgage on your house can prove challenging even in the best of times. If you fall behind on your payments, you can quickly find yourself facing an upside-down loan with dire financial consequences. Instead of floundering and coming up on a foreclosure sale, there are proactive steps you can take to help avoid foreclosure and keep your property in your possession. Here are some of the best strategies to utilize for homeowners...more
Sometimes, when dealing with the ongoing issues involved with trying to get out of bad debt on your home, you may have to conduct a short sale to avoid foreclosure. However, you can find ways to negotiate with your lender to cancel any outstanding debt and move on with your life. Or so you thought.
When you successfully negotiate a debt cancellation with your lender, you feel an immediate sense of relief. That canceled debt can feel...more
When you pursue a short sale, you’re making a tough decision that clears the way towards rebuilding your financial future. When you finish the process, you must have the paperwork in hand that proves that you can move forward without your lender coming after you for the rest of your mortgage in the future. Without a deficiency waiver, though, that’s just what might happen.more
When you’re behind on your mortgage payments and on the brink of losing your home, the best option may be a short sale to avoid foreclosure. By definition, a short sale is when the selling price of a home comes short of being enough to pay off the balance of the loan.
In this situation, you’ll need the bank’s permission to sell your home for less money than you owe. Read on to find out how to convince your lender to agree to a short...more
The undue financial hardship that necessitates the need for short sale assistance is not exclusive to residential homeowners. Commercial property owners can run into similar situations where they cannot make payments on their properties and end up trapped in an underwater mortgage. Suppose your commercial property winds up becoming less valuable than your mortgage payments. In that case, you are within your rights and power to look at...more
If you’re a homeowner going through financial hardships which have caused you to miss multiple mortgage payments, going through a short sale to avoid foreclosure can be a saving grace. We understand that the process can be difficult to understand and overwhelming at times.
When you partner with the short-sale specialists at EZ Short Sales, though, we can help you avoid foreclosure by short selling your home. Our dedicated short-sale...more
Hi Everyone! We wish you all a happy new year and a very successful 2012! So what will this year bring to the market, and how will it affect the REO inventory and industry as a whole? Find REO Specialist.
1,750,000 REOs still haven’t been listed
3,500,000 Mortgages are in default
15,000,000 Homes are under water
Asset Management companies are busier than ever and looking to new and creative...more
Are you looking to sell your home through a short sale? If your home is underwater, this may be a great option for you. EZ short sales connects you with local short sale experts in your market area. Search our Short Sale specialist directory and compare specialist profiles, so you can make an educated decision, and maximize your chances of having success with your lender. If you’re selling your home, a qualified real estate specialist can...more
Pre-Screen Short Sale Listings: Before taking a short sale listing, carefully consider the likelihood that the transaction will close escrow successfully. Consider, for example, how much of a shortfall the lender must approve. Other considerations include, but are not limited to, the nature of the seller’s hardship, the time you have to sell before the homeowner potentially loses the property through foreclosure, the number of liens against...more
Zillow reported last week that 15.7 million homeowners are underwater, about 31.4 percent of US mortgages. People say things are getting better, but clearly there is still a huge problem and the housing crisis has a ways to go before calming down. Some areas are much worse off. For example, 79% of homes are underwater in Las Vegas, and other major cities like Phoenix, Orlando, Riverside and Atlanta are all over 50% underwater. This...more
What Is a Short Sale?
Short sales can be beneficial to homeowners as well as lenders. Lenders often receive more money for short sales than foreclosures, and they do not need to be involved with property upkeep and disposal. Short sale houses are generally in better condition than foreclosures because the homeowners want to sell their properties as fast as possible.
Homeowners who find themselves in a situation where mortgage payments are just too expensive and cannot make their payments do have a couple of options to reconcile the situation. One option is foreclosure, but this can lead to many more issues down the road in terms of the homeowner’s creditworthiness. Another option is to do a short sale, which can give someone the control in selling their house to rectify the situation with the mortgage...more
The number of short sales in the US has risen dramatically in the past several years as home values have fallen below the amount of the mortgage on the property in many situations. This is especially true in markets where there was a tremendous escalation of real estate prices and banks created numerous mortgages based on these overinflated values. Now that prices have plummeted from these unsustainable highs, the lenders are trying to cut...more
Short Sale: Is it a preferable option for the homeowners?
In the US, home prices have dropped as much as 50%, so people are keen to know what they can do in order to impede the bleeding. There are definitely various strategies available to lower the mortgage payments. However, when you’re underwater, refinancing with mobile home loans may not be a right option. In this situation, you may be desperate to come out from...more
…typically a short sale property is turned over 10 months faster than a foreclosure. Meaning the banks shave ten months off the time in which they are not receiving any payments from the distressed property owner. Some of the major changes that were included in this reform was that no longer will homeowners who are 90 plus days behind on their mortgage and have a FICO score under 620 be burdened with the task of producing hardship documents....more
This national exposure has BOOMED our lead flow!! We need good specialists to handle them this huge inflow of seller leads! If you’re looking to get more listings, then upgrade to a Featured Membership today.
95% of the listings go to Featured Members!
80% of leads turn into listings!
100% Satisfaction Guarantee!more
That’s because many people who are behind on payment are being allowed to stay in their homes for years at times, so this is pushing back the date when these coming short sales are flushed through the system. That’s good for real estate specialists because it means more short sale listings for you! We have seen a dramatic spike in seller activity on our website, as they look for real estate specialists near them to help them short sale...more
Peggy Patschak has over twenty years of experience in the real estate and mortgage industry. Peggy has completed over fifty short sales and is currently serving the Frederick, Carroll, Washington, Howard and Montgomery Counties in Maryland. She is a proud member of the National Association of Realtors and several other associations. Peggy’s drive and compassion towards helping others has made her a successful short sale...more
According to Lender Processer Services, 60% of borrowers who are behind on their mortgages in judicial states haven’t made a mortgage payment in over 2 years! In non-judicial states, it’s 30%. Both are incredibly high numbers. One of the main reasons for this is the banks are advising their clients to modify their loans or attempt a short sale. We have seen a dramatic spike in seller activity on our website, as they look for real estate...more
Lender Processing Services (LPS) reported a spike in delinquency rates in the month of September, compared to August, which means even more foreclosures are likely to stack up on top of the shadow inventory. For those who think the REO bubble has burst, this should be a wake up call. It’s not even close to being over. In fact, some banks are holding back up to 90% of their REO inventory. These foreclosed homes don’t just disappear. They need...more
…Even though housing prices have come down, so too have incomes across the country, and in many areas, it’s still been difficult getting an offer accepted. With so many cash investors stepping into the market again, they have squeezed out many other buyers, and are getting properties for less than market value since sellers tend to prefer to work with a quick closing cash buyer than a buyer with a loan.
This is an issue the Center for...more
HAMP has officially stopped 1 million loan modifications in the works. 23% of those cancelled loan mods have already re-defaulted and started heading right back into foreclosure. These numbers are expected to dramatically rise as banks continue to speed up the unloading of the shadow inventory backlog.
Additionally, CLS Asset Management points out that “the recent mandate by the administration that Fannie Mae and Freddie Mac...more
It is a fact universally acknowledged that housing has multiple problems and the solutions always remain elusive. Taking out a mortgage loan to purchase a house is perhaps the biggest responsibility on your shoulders as your home will be pledged as collateral to the loan. When it comes to repaying the mortgage loan in easy and affordable monthly payments, there are some who fail to do it on time and this gives rise to various financial and...more
Ellie Mcintire is a full time realtor located in Central Maryland. Ellie’s ten years of experience has made her a excellent realtor. Ellie understands the hardship that brings a person to sell their home. Her compassion and desire to help others has granted her to complete over 32 shorts sales!
Cheryl Keller spends her time dedicated to helping serve the community of Roseville, California by helping...more
During the election campaigning, many of the nation’s serious housing issues were left unsaid. Foreclosures, tight credit availability and underwater homeowners continue to threaten the developing economic recovery. Those hit most by the housing crisis, including the homeowners in Florida, Nevada and Arizona, have been left particularly concerned. As President Obama gradually is sworn in for his second term, many are left questioning how the...more
Also, they are speeding up the process. If you’ve been selling short sales recently through our network or your own, you may have noticed some of the major lenders responding quicker than usual. The results has been that there have been nearly twice as many short sales completed as there were REOs in the last quarter.more
In 1976 Bob Anarumo started his career in the real estate industry and has been actively involved in commercial and residential properties since. Bob has several years of experience in Short Sales within the Central Florida area. Bob has been recognized several times as the Top Sales specialist by the Coldwell Banker Team Reality. Currently Bob has been focused on new construction, REO’s, short sales, foreclosures and investment properties....more
If this process is finalized by December 31st, 2012 about 1.5 million homeowners in foreclosure or considering a short sale need to understand the different tax implications.
Unfortunately the Mortgage Relief Act is going to expire soon. This act allows up to $2 million of forgiven debt to go untaxed. If you have your mortgage debt forgiven after December 31, 2012, your tax liability could substantially be increased.
To everyone’s surprise, U.S. home resales unexpectedly rose in October. On Monday the National Association of Realtors announced that existing home sales climbed 2.1 percent last month to a seasonally adjusted annual rate of 4.79 million units.
Some speculate that super-storm Sandy, which slammed the U.S. East Coast on Oct. 29th had only a minuscule impact on home resales. The only region where the pace of sales slipped was the...more
Over the 12-month period, prices increased in 90 percent of cities. Phoenix was amongst the highest, jumping approximately 20 percent. Even the hardest hit state, Las Vegas, saw a price increase of 1.4 percent, the biggest gain in a long time. Cleveland, was the largest decline where prices fell 0.9 percent.
Since monthly prices are not seasonally adjusted, some of the declines may signal the end of the summer buying period. Despite...more
Are you one of the thousands of homeowners ready to sell your house, but owe more then your home is worth? Through a process called a short sale you can…
- Save your credit
- Possibly walk away with no debt or tax consequences
- Avoid foreclosure and bankruptcy
- Sell your home for less than what you owe your lender
Without going through foreclosure, or declaring bankruptcy we can help you sell your home...more
According to CoreLogic, mortgage fraud is on the rise again, with over $12 billion in fraudulent originations this year. Corelogic attributes this to high levels of unemployment, combined with low mortgage rates, incentivizing homeowners to misrepresent their employment status on loan applications. It’s a sad truth, but a truth nonetheless and we wanted to share this because it’s a sign that employment is still the remaining issue, and the...more
According to RealtyTrac, which tracks pre-foreclosure and short sale data nationwide, short sales are on the rise, and are being utilized more and more as an alternative to foreclosure. In fact, year over year, short sales have increased 17% according to their most recent report and on average, short sales were sold $95,000 below the loan amount!more
Attention Short Sale Specialist. Starting February 1, 2013, the Home Affordable Foreclosure Alternatives program (HAFA) will undergo some major changes that will speed up the short sale approval process, which is welcome news to all specialists nationwide! One of the major changes is the requirement that servicers must make a decision on a borrower’s short sale request within 30 days. Another major update which is certain to speed up the...more
The somewhat long and frustrating process of short sales are sometimes a deterrent for specialists. However, the best part of short sale listings is that the process for sellers isn’t all that bad. Since the seller isn’t paying the real estate commission, they have less objection and can move forward with the process quickly.
Helping understand seller concerns can lead specialists to more listings. Short sale specialists should take...more
Was 2012 the year of the short sale? Will short sales mitigate losses for mortgage lenders and servicing institutions in 2013, or will they be ignored in favor of fast-track foreclosures? For real estate and mortgage brokers in California, 2012 was definitely a breakthrough year for short sales, and this mini-boom could not have arrived at a better time.
The uptick in short sales was certainly good news for the Golden State, a housing...more
Wow that was close!
At the very last minute, Congress passed legislation extending the Mortgage Debt Relief Act for homeowners who do a Short Sale through 2013. When a homeowner sells their home, the IRS won’t treat the debt forgiven by the bank as income, which means they won’t owe taxes on that amount, therefore allowed a seller to short sale their home without immense tax consequences.
This is amazing news for short sale...more
Your bank will require you to put together a big package of documents before they let you short sell your home. This will include lots of financial documentation showing your income along with an estimate of the “net to seller” amount (the total payment to the seller after fees). The numbers side of things is all very black and white. But there’s one piece of paperwork that’s a little more personal – the hardship letter for short...more
Even big stars can get into trouble when they buy houses in a booming real estate market. For example, Chris Tucker listed his $6 million dollar mansion in Florida for short sale at just $2 million in 2010. In 2011, singer R. Kelly put his $3 million dollar home on the market for $1.595 million. Burt Reynolds, Carnie Wilson, Rihanna and many other celebs have gone down the same road over the past couple of years.
The fact is that anyone...more
When you start negotiating a short sale, it can be tempting to do whatever it takes to get the deal to go through. The problem is, as a seller in duress who is underwater on your mortgage, you don’t have a lot of leverage. In fact, it’s your primary mortgage company that holds most of the power in these negotiations. They get to decide who gets a slice of the pie.
Junior lien holders are second in line when it comes to getting a chunk...more
That’s a question that any savvy buyer should ask before putting in an offer on a “deal that seems too good to be true”. In fact, the seller and the realtor brokering the sale both have a legal duty to disclose that the home they are trying to offload is a short sale. That’s the law in California ever since a prospective buyer had a deal fall through when they offered to buy a home for the asking price of $750k.
The fact was that there...more
If your home is worth less than the amount you owe on your mortgage and you are struggling to pay your bills, you may be tempted to short sell your home. That can actually be a viable option to foreclosure in many cases. It does less damage to your credit and often lets you walk away with no outstanding mortgage debt. Plenty of folks will express an interest in helping you with that process. But they don’t all have what it takes to get the...more
Did you know that the New Jersey housing market is starting to recover? That means if you are interested in buying short sales in NJ, you need to act fast. According to the Federal Reserve ‘Beige Book’ for March 2013: “While there remains a large overhang of foreclosed and distressed properties, many of these are expected to be snapped up by investors.” Since the region is just starting an upswing, prices are still good – and interest rates...more
Short sale debt cancellation is one of the most important aspects of getting out from under a home you can no longer afford to pay for. Without this “forgiveness”, all you have done is sell your home for less than you owe to pay off a portion of your loan. The bank can still come after you with a deficiency judgment for the balance of the mortgage. This doesn’t just happen with primary lenders. If you have refinanced your mortgage or taken...more
If you are a short sale specialist, you know that negotiating with the bank to set an acceptable sale price can be tricky. The bank may not want to reduce the price of the house enough to make it attractive to potential buyers. In that case, you may be stuck doing a lot of work and simply not being able to close a deal.
Occasionally, there may be a benefit to having a house inspected early on when you are trying to arrange a short sale....more
The answer is yes and no. Because you don’t actually hand over the deed to your home to the bank until closing, you are the one receiving the sales money for the home. On paper (such as on the net sheet), you are the one paying all the closing costs, fees, taxes, real estate specialist commissions, etc. But you are immediately turning around and giving all the remaining money to the bank. Since you owe more than the home is selling for, it’s...more
Did you know that the FTC has rules about what your short sales specialist needs to tell you when they offer to represent you? These disclosures are covered under the rules for providers of MARS (Mortgage Assistance Relief Services). They help protect consumers from misleading advertising. Here are 4 of the top things you should know.
The Bad News
· Your specialist can’t guarantee that your lender will let you...more
It’s been almost a year since Las Vegas short sales first outstripped Real Estate Owned (REO) deals (sales that occur after a bank re-acquires a property in foreclosure). According to the LV Review Journal, the prohibition on “robo-signing” of foreclosure documents is just one factor that’s made it more attractive for banks to work with homeowners who are financially distressed. Now, with some experience under their belts, banks in the area...more
Short sale tax implications are pretty complex since there are several different aspects involved. Here’s an introductory overview that will help you ask the right questions when you weigh the pros and cons of short sale vs. foreclosure.
Tax Relief Continues for Insolvent Homeowners
Prior to 2007 when the Mortgage Forgiveness Debt Relief Act went into effect, you would owe income taxes on the balance of your unpaid mortgage that...more
If you qualify for a short sale under the HAFA program, you are eligible for a $3000 one-time “Borrower Relocation Assistance” payment from the government. Your primary lender may also sweeten the deal with an additional incentive to facilitate your ability to move out (leaving the property in good condition, of course). Relocation assistance isn’t just for covering rent on an apartment or hiring a moving van. Here are 3 other ways this sum...more
Setting the price on short sale properties is always a bit of a guessing game. It’s important to strike a balance between the loss the bank is willing to accept and the amount buyers will actually be willing to pay. There are two ways of evaluating a home during the sale process. The original lender typically uses a broker price opinion (BPO) to determine an appropriate selling price. This is a “fast and dirty” way for the bank to assess how...more
Typically, investors and house flippers don’t care much about the little details of staging when they buy a house. They just want to take advantage of depressed property values to make a sweet profit. But if you are short selling your residence to someone who wants to actually live in your home and make it their own, it still pays to make everything look nice. This increases the perceived value of our home so it can be sold for a decent...more
How long do you need to wait before applying for a mortgage after short sale? According to a very informative Forbes.com piece by Gerri Detweiler, it all depends. You might qualify sooner than you think. Generally, it takes two to four years before a bank will be interested in loaning you the money for another home. That’s just about enough time to get your finances together, clear up outstanding debts, and find a home you can afford. Here...more
Reverse staging is the latest in a string of short sales scams. The tragic thing about this particular fraud is that innocent houses end up getting hurt. In this scam, the idea is to get the bank to accept a very low price for the short sale. An untrustworthy real estate specialist is typically in on the scam and plans to sell the house to someone they are in cahoots with who will pose as a buyer. The bank that holds the mortgage will...more
An SSLB or short sale leaseback program allows homeowners to remain in their house after a short sale. They simply rent it from the new owner rather than vacating when the sale closes. This may seem like an unusual way to structure a sale, and that’s certainly true. When short sales first became popular, all transactions had to be at “arm’s length”. But a 2011 amendment to the Making Home Affordable program opened up the possibility of the...more
Your lender will want to compare your income stream to your expenses to see if you really can afford to pay your mortgage. Remember that all short sale forms you send to the bank are filled out under penalty of perjury (you can get in trouble in court if you don’t tell the truth on these forms). Here are the types of income you are typically required to disclose:
Wages (including overtime, holiday pay, etc.)
Tips, commissions or...more
If you are a self-motivated person, it might seem like a good idea to get started on your short sale process by finding a willing buyer before you go to your bank to start the approval process. But with Bank of America, this might actually limit the benefits you receive. This major lender prefers that you get preapproval through one of their short sale programs first. For example, if you are counting on relocation assistance from BofA, you...more
Do you have an FHA insured loan that is serviced by Bank of America? This can make your short sale approval process a bit more complicated than usual. You have to get the FHA’s OK before the bank will even consider your eligibility to participate in one of their short sale programs. According to an excellent and informative article by realtor Elizabeth Weintraub at About.com, you can expect the process of approval to take a while. You will...more
Why Do Banks Prefer a Short Sale vs. Foreclosure?
We’ve blogged quite a bit about the benefits of a short sale vs. foreclosure for homeowners. Short selling does less damage to your credit, is less embarrassing than a foreclosure, and actually lets you walk away with a little cash for relocation expenses. But what makes this option appealing for banks? Why should they let you walk away from a home while they take a loss?
If you are in the process of buying a short sale and qualify for an FHA loan for the mortgage, you should act quickly to seal the deal. The loan application process itself may not take too long, but short sale negotiations may tend to drag on. That’s all the more reason to get started right away and make sure the seller has already gotten preapproval from their lender. If you wait until June to get your loan, you will be facing a dramatic...more
Do you have a rental or investment property that’s lost value rapidly in the last few years without generating sufficient income? Or, do you have a vacation home that you just can’t afford to keep? You may be wondering whether you can short sell this home and get out from under.
The answer is: “maybe”. As with any short sale, it’s up to your lender to determine whether they will accept less than the home is worth. It may still be a good...more
If you are filling out the initial financial forms to start a GMAC short sale, pay special attention to the third party authorization form near the end. This is the document that gives your lender permission to speak to your real estate specialist or another party you designate on your behalf. It’s a critical piece of the puzzle if you want a professional to help you negotiate with the bank about your short sale. This form contains a few...more
Luxury short sales attract a lot of attention in the media because American consumers like two things:
Getting a glimpse of the lifestyles of the rich and famous
Reading a good riches to rags story
It’s not a pretty habit, but a lot of people do like to point smugly at wealthy homeowners and ask, “How could they get in so far over their heads?” Of course, we know that real estate woes can happen to anyone. Property values...more
How do you begin the process of a short sale? By asking and answering a few critical questions. Here are the first things you need to figure out:
What’s Your Ideal (or Acceptable) Outcome?
If you don’t know what you actually want to accomplish with your short sale, it’s unlikely you will achieve it. So, you need to start with the end goal in mind. Here are some questions that can help you clarify your objectives:
· Are you...more
As you prepare your short sale package, you want to include all the information that might convince the person reviewing it to say “Yes” to your application. This means being open and honest about your money situation, job status, divorce, and much more. Having a big stack of medical bills is one of those financial catastrophes that might qualify you for a short sale. Unmanageable, unexpected medical costs are definitely something to mention...more
Do you know the origins of the short sale? HUD (Department of Housing and Urban Development) is the organization that really kicked off this option in a big way in the United States. While some banks already approved short sale deals from time to time as a loss-mitigation measure, this wasn’t a particularly well-established alternative to foreclosure just a few decades ago. It took the federal government to bring this practice into the...more
One of the most frustrating things about trying to close a short sale is that there are so many different parties involved. As a real estate specialist, you have to interact with:
· The homeowner (who is likely dealing with their first short sale and needs a lot of help along the way)
· The bank servicing the loan (an entity that may be dealing with thousands of short sales and that isn’t particularly interested in your particular...more
In 2012, Representative Joe Heck from Nevada introduced a bill to Congress that was designed to give his constituents a second shot at homeownership. The Las Vegas short sale and foreclosure numbers have been off the charts in the past few years compared to other parts of the country. This housing crash has destroyed the equity and the credit scores tens of thousands of hard-working people in Nevada.
Foreclosures are Down but Short...more
Buyers, sellers and specialists will be happy to know that major players in the short sale process are taking steps to make their systems more efficient. For example, PennyMac Financial Servicers announced in June that their home loan division has implemented an automated program to shorten the timeline for pre-foreclosure sales. According to the company’s director, a short sale really shouldn’t take any longer than a traditional home sale....more
Last year, Utah legislators decided to take action to make it less risky for homeowners to short sell their home. S.B. 42 is designed for traditional Utah short sales that fall outside the HAFA regulations. In this type of transaction, the lender releases the mortgage (deed) against the property in exchange for receiving the net proceeds from the sale. Unlike with HAFA, the homeowner still has an outstanding unsecured loan balance they are...more
We’ve written on this blog before about various scams that homeowners can get caught up in if they aren’t wary. Often, unscrupulous real estate specialists, property investors, and self-styled “short sale negotiators” are the instigators. But sometimes, sellers know exactly what they are getting into and have no one to blame but themselves. One couple is facing up to three decades in prison and a $1 million dollar fine for an allegedly...more
A well-researched short sale wiki can be a good starting place to learn the basics about pre-foreclosure home sales. Different wikis are aimed at different audiences. For example, some cater to investors who want to buy and flip homes. Others are targeted at the average homeowner. If you are a real estate specialist, you may find it helpful to have a list of wiki links on hand that you can use to educate buyers and sellers about the short...more
Are you a homeowner who has an FHA backed mortgage? Are you trying to arrange a short sale? HUD has its own set of rules for how low the price can go on your home. Knowing the limitations can help you assess the likelihood that your home will actually sell in the four month allotted time period. Don’t blame your real estate specialist if they can’t negotiate with the lender to agree to a lower price. For mortgages that fall under HUD...more
Many real estate specialists are discovering that short sales tend to mean lots of extra work – especially tedious paperwork and phone work. Instead of the exciting ability to get homeowners a great price or home sellers a fantastic place to live, realtors can get stuck in a quagmire of back and forth negotiations with the bank.
In the end, no one is necessarily happy. The seller is just relieved to get out from under. The buyer is...more
We’ve talked on this blog before about the effect of a foreclosure vs. short sale on a consumer’s credit history. Unfortunately, a lot of homeowners have been getting punished for short selling by having an ambiguous black mark on their credit report. According to Ken Harney at inman.com, the way loans are closed out in a pre-foreclosure sale can look pretty much the same as an actual foreclosure.
Why the Confusion?
Banks have added far more inventory to their REO listings over the past few years than they had bargained for. Yes, they were foreclosing right and left with all the robo-signing nonsense. But they ended up having to follow through and actually take possession too often. Ideally, a bank that forecloses on a home wants to offload it right away at an auction. However, the standard approach to selling at auction is to set the minimum bid at or...more
Short sales used to represent a fairly small percentage of home sales. But these days, they’re all over the place – on every street corner in every town where housing prices are down and unemployment is up. This means the entire real estate industry is getting a crash course in short sale negotiation and processing. It turns out, not everyone is really enthralled with this new educational opportunity. Several major stakeholder groups are...more
A short sale is the sale of a home for less than what is owed the lender. The bank (or other financial institution holding the loan) agrees to let the home be sold to a third party for less than the balance due on the note, and forgives the remainder of the debt.
A short sale candidate typically has little or no equity in their home. In many cases, the home may be “upside down”, meaning it is no longer considered worth what it once was,...more
While there are no guarantees, a short sale is generally better than a foreclosure when it comes to how lenders will view your credit in the future. The real pivotal factor is in how you handle matters before, during and after the short sale.
Lenders, including banks or other financial institutions that hold mortgages, have the right to report to credit bureaus as soon as a debtor goes 30+ days behind on a mortgage payment. When late...more
Completing a short sale can be a lengthy process. You can facilitate your short sale by having a short sale specialist who will walk you through the steps, and by having all of your own paperwork and information in order.
Stage One: Documentation
The first stage of the process involves the homeowner gathering all documentation about the home and the mortgage(s) and any other info to give to the specialist. How long this takes...more
Are short sales still a viable option? Many may think that reports of the market “improving” would mean that shorts sales are on their way out – but in reality, there’s never been a better time to short sell your home.
It all comes down to semantics. The real estate industry and the government are desperate to be able to report that the housing market is recovering, but the way stats are reported can be tweaked. For example:
A short sale is often the best choice for a first-time homebuyer who has plenty of patience for the process. Prices on short sales are better than ever, allowing first time homebuyers to get more house for their money. Even if the home has devalued at the moment, buying when the market is down means the home is more likely to increase in value over time, making it a great investment.
Short sale information is readily available to those...more
Most people looking for short sale information don’t get the whole picture. They know about the seller, that they are probably upside down on their dream house, financially in difficulty and willing to lose all equity in their home just to be out from under the debt.
What they don’t realize is just how desperate lenders are to unload homes without having to foreclose. Lenders know exactly how bad the current foreclosure crisis is,...more
Are you considering a short sale, as either a seller or a buyer? You need a short sale negotiator. That’s not because you aren’t smart, or competent. It’s simply because short sales are complex and one misstep can throw a wrench in the works!
It’s just like a host of other areas which require special training. You probably wouldn’t try to teach college level chemistry if you weren‘t fully qualified, or to operate on your own brain, or...more
There’s a lot of misinformation floating around about short sales. Whether you are buying or selling, you should know the truth about each topic. This short sale information helps debunk some of the most common and persistent short sale myths!
Short Sale Myth One:
Banks do not wish to do short sales. FALSE! While short sales are not ideal for the original lender, banks would much rather do a short than a foreclosure. Foreclosures...more
Usually, before a bank will approve your short sale request, they will ask to see your hardship letter. For many, the hardship is purely financial, but this is not always the case. There are many situations that can qualify as a hardship. If your situation has significantly changed in any way since you first signed the loan on your home, you may be able to qualify for a hardship.
Here are some of the most common reasons accepted as...more
If you are doing a short sale in California, you may have gotten an extension on tax debt forgiveness. California law, passed in 2011, protects homeowners from lenders attempting to collect additional assets in the case of a short sale. This was in expectation that Mortgage Forgiveness Debt Relief Act, signed by congress in 2007 and renewed in 2008 to expire in 2012, would in fact expire. The Act was extended through 2013, but there is...more
Short sales in Florida are still booming, thanks to ever changing shifts in the real estate market. Thinking about short selling? Now is a good time!
A large number of cash buyers flooded into the real estate market in Florida in late 2012, and some thought that the lessened inventory meant short sales would become a thing of the past. However, according to Equator, the lender online processing service, in the 1st quarter of 2013, Miami...more
Have you reached the point at which you KNOW you aren’t going to be able to keep your current home, and the only question now is how can you get out with a minimum of lasting harm? Moving fast is probably your best bet!
If you complete your short sale in 2013, you won’t owe federal taxes on the transaction, thanks to Congress, which extended mortgage cancellation relief through the end of 2013. So home owners who have a portion of their...more
According to federal financial regulators, approximately $30 billion in home equity lines dating back to 2004 are about to be reset – thanks to a ten year mandate that means borrowers will have to start paying principal as well as interest on what amounts to second mortgages on their homes.
The credit lines were in large part started before the housing bubble burst, and were based on current equity values. Now, with so many homes...more
Climbing mortgage rates in 2013 corresponded with declines in home buying, and many experts believe that this a trend could continue in the coming year as interest rates adjust due to recent to shifts in the Federal Reserve’s stimulus effort.
A lot depends on interest rates, with the standard 30 year fixed rate being the base off of which analysts go when predicting real estate futures. When interest rates go up, even just a few tenths...more
The past few years have been a veritable roller coaster ride for the US housing market, and more and more homeowners have been turning to short sales as an alternative to avoiding foreclosure. However, unless you have an experienced short sale specialist to walk you through the process, you may find yourself the recipient of a startling surprise just when you think you are done with everything.
Free and clear? Not so fast.
When discussing a short sale, many homeowners don’t realize that the state they live in may have a lot to do with how successful they are discharging their debt. Many assume a short sale automatically wipes the slate clean, but this has to be explicitly spelled out in the short sale agreement. There are some states that make it easier than others.
Some states are called deficiency judgment states, and these allow lenders to pursue the...more
When a property is sold for less than the balance remaining on the mortgage loan, that is called a short sale. A short sale can benefit homeowners in many ways, by helping them get out of an upside-down loan, avoid foreclosure and eliminate their mortgage debt. Short sales today are also, on average, taking less time to process than before – thanks to tighter regulations and better practices in the industry. However, there are still a lot of...more
Last week we started looking at the myths that discourage many people from seeking the relief a short sale can afford. Today we finish up our list!
Myth Number Five: A short sale will prevent me from qualifying for a new mortgage.
Wrong! You could qualify for a new home loan within just 2-4 years of a short sale; even less if you never fell behind on payments! Comparatively, a foreclosure can ruin your chances of getting a home...more
Rumors keep circulating about stiffer mortgage lending requirements. They simply aren’t true, according to real estate expert Fabian Calvo, who says,
“If you can fog up a mirror or you have a pulse, they will give you a home loan. That’s what they have done with the car loans, and that’s what they are doing with housing loans.”
Easier home lending requirements means the housing market isn’t in that great of shape, still – despite...more
A “rebounding housing market” isn’t exactly in the future, says Peter Wallison, author of the much-commented-upon opinion piece in the New York Times entitled “The Bubble is Back.” A dissenting member of the 2011 Fiscal Crisis Inquiry Commission, Wallison blames government housing policy for the last bubble and warns that another is soon to burst.
This is good news for the short sale market, as well as homeowners who simply don’t see...more
Forget underwater mortgages; worry about higher rates
(Source: Housingwire) According to Housingwire “the U.S. mortgage market is about to be blindsided by a real doozy of a problem.” And while home values may be increasing somewhat, their studies show that “Rising rates will swamp households faster than rising home prices can save others.”
The big problem
While many homeowners were hoping they could now refinance out of...more
Not only is Robert Kiyosaki one of the most respected men in Real Estate, he is a trend setter in the world of personal finance as well. Needless to say, when Robert speaks… you should listen. We have recently been given access to a variety of FREE resources from the big man himself, and we are delighted to have the opportunity to share them with you. Take advantage of these free resources to achieve SUCCESS.
To start off we would like...more