November 1, 2012 short sale changes

These changes are to streamline the short sale process and have the goal of shortening the timefram of a short sale completion.  Starting Nov. 1, 2012 even borrowers that are current on their mortgage are eligible for a short sale on loans where Fannie and Freddie are the investor-as long as a hardship still exists. Some more benefits are:

• Relief for those underwater who need to move over 50 miles for a job
• Waive right to pursue deficiency judgment in exchange for financial contribution when a borrower has sufficient income or assets to make a cash contribution or sign promissory notes
• Reduced or eliminated DOCUMENTATION for those borrowers who have missed several payments, have low credit scores and serious financial hardships
• Offer up to $6,000 to second lien holders to expedite a short sale

The last bulletpoint in my opinion may lead to a mini wave of short sale approvals PRIOR to November 1, 2012 because currently the junior lien holders receive a max of $8500 in a HAFA short sale.

Also interesting to note is that from Nov. 1, 2012 the HAFA program will be known as a Standard Short Sale/HAFA II.

However, borrowers who take advantage of a short sale will need to wait at least 2 years for a new mortgage that is backed by Fannie Mae or Freddie Mac.

Just a refresher, the Federal Housing Finance Agency (FHFA), the entity that makes these new changes is the agency that regulates Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks.  These GSEs (Government Sponsored Enterprises) provide more than $5.7 trillion in funding for the U.S. mortgage markets and financial institutions.

If you or someone you know is a distressed seller in South Florida, please have them reach out to me today!

Good afternoon Everyone!

Just wanted to introduce myself to the group. My name is John Miller and I work with Keller Williams in Sewell, NJ. Looking forward to sharing and receiving information from other members in the forum.

From ballotpedia.org,

The Florida Property Tax, called Amendment 4, is on the November 6, 2012, state ballot in Florida as a legislatively-referred constitutional amendment.

The proposed amendment would prohibit increases in the assessed value of homestead property if the fair market value of the property decreases; reduces the limitation on annual assessment increases to non-homestead property; and provides an additional homestead exemption.^[1]

Specifically, non-homestead or commercial property would have their assessment increases capped at 5 percent per year.^[2]

Additionally, the measure would implement an additional homestead exemption for first-time buyers equal to 50 percent of the median home price in the county. The additional exemption, however, would be gradually reduced until it expires within 5 years.^[2][3]

The proposed measure requires 60 percent voter approval for adoption.

The Florida Association of Realtors supports Amendment 4, as it offers a big tax break for first time homeowners.  The other side of the coin is lost revenues for local governments which are already struggling due to the collapse of assessed values during the housing bust.

I have to say I need to research the amendment more before I make my final decison.  What say you FL Realtors?

Just letting homeowners thinking about doing a short sale know of some of the last minute craziness that is sometimes unavoidable.  I have a file where the borrowers property took several months to get under contract.  In South Florida, that is a rarity!  Properties here can get multiple offers as soon as the same day of listing.  So in this case the one lender on the file calls me yesterday to advise me if the property does not close in 2 days that unfortunately, the property will have to go to foreclosure.  Just like that!  So everyone involves does everything but move mountains to be ready to close.  Then later that Wed. night I get another call from the lender SPS Servicing.  Now the investor, Nautilus Capital Mgnt needs to net $80,682.  This equates to a sales price of $90k instead of the contract price of $80k.

So the clock is running out but I am pulling out all the stops to try to get a successful closing for my client who has done everything necessary to try and cooperate.  Since I found out from the servicer that the adjusted BPO value is $75k I reached out to the investor directly to see if they will re-consider taking the $80k.  If they answer me today we could still close on their mandated date of tomorrow.  We'll see how it plays out.

10-11-12 Update:

File officially declined on Monday.  Letter went out to borrower.  Then on Tuesday low and behold the buyer agent states NOW the buyer will pay $85k for the property.  My question was why didn't this answer come last Thursday when it would have been helpful!?

The next step is I placed the property back active on the market as an approved short sale.  Will try to get the last buyer to put the $85k offer in writing in the form of an addendum.  SPS states it will only take about a week to get an answer from the investor.  If yes, we close asap.  If no, I'm already marketing the property for a better offer.  Borrower is going down to courthouse today to submit paperwork to get foreclosure sale date that is set for 11-7-12 delayed.  When I get confirmation of this I will send same to SPS along w/ updated offer addendum.  Until my next update....

We listed a house that was in awful condition at $90,000 May 1, 2012.  We then initiated a HAFA short sale.  As you know, it can be initialted until it is listed.  On May 4, we got a cash offer of $70,000.  It was held until all documentation was done as it should be.  It was assigned by BOA to their vendor AMO, all docs were sent to them other than the offer. An appraisal was done 5/22.  It then was re-assigned by BOA to NDS (another vendor) and a negotiator was assigned (Rebecca King) on 6/20.  On 6/25 the offer and proof of funds was submitted.  In all our calls and emails, nothing was needed should move quickly.  On 7/24 the negotiator said it was being submitted for final decision.  Then everything died.  We called, emailed, escelated and did everything possible to move this along. 8/22 we finally got the SSA letter with a price of $59,400 with a closing before 12/15/12.  Again after repeated calls, emails etc. Rebecca King on 9/17 called and said she just got the file and it was starting over. The buyer then lowered his offer to $60,000 and that was submitted.  on 9/17 we were told to lower the listing price to $52,300.  All docs were re-sent as per Ms. King's instructions.  A new appraisal was done 9/23.  9/26 Ms. King closed the file "due to age" and that was that.

We have re-initiated this deal with another vendor directy (DTS) to see if we can get a better outcome.  Yet another appraisal was done 10/6.

Bank of America shot themselves in the foot, as they had a cash offer of $17,700 over what they wanted and the negotiator closed the deal.  I wrote to everyone in BOA etc.

Does anyone have any other suggestions as to what can be done? 

Good morning Superstars. Have you ever been sued by a Seller or Buyer?? I haven't. But if I were I'd be ready to stand in front of any judge and defend myself.

It's my opinion that over the next few years there is going to be a huge increase in lawsuits against agents and brokers. Mostly related to Short Sales. That Seller you helped is going to be real pissed off, 5 years from now, when he is slapped with a deficiency judgment and his wages and assets are garnished.

Will you be prepared to defend yourself? Do you have a written record of what when down during the Short Sale process? Or did you just wing it?

Here are some things I do now to protect myself in the future. Hopefully there are a few you can implement into your business. Even better, maybe you have some ideas that I can use.

When there is a Junior Lien (secondary mortgage) that is delinquent more than 120 -180 days a creditor may choose to charge-off the debt owed. A charge-off is the declaration by a creditor that an amount of debt is unlikely to be collected. In doing so the creditor is able to write off the full amount on their taxes and claim it as a loss. A Charge-Off does hurt your credit and can stay on your credit report for up to 7-10 years.

It’s important to know that it would be rare for a 1st lien to charge off because of their adequate assurance in the value of just the land but who’s to say it’s not possible. When a lien is charged off it is often transferred to a... For the entire article click here

Brett@ishortsalenow.com

310-564-6389

By now you are probably telling yourself, having an investment property is not as easy as you thought. To make matters worse, your property is now underwater and it shifted from an Asset to a Liability. It is a liability because you may be dealing with negative cash flow, accruing repair costs, vacancy, and most importantly, it is underwater meaning you owe more on the home than it is worth. Let’s explore some options.

No Credit Ding Options

• Option #1 – Ride It Out

If you have sufficient income to support your investment property, you can ride the market out in hopes of selling it at a higher price point.

• Option #2 – Improve The Property

You can improve the property by getting a fresh coat of paint or getting landscaping work done. However, this is very risky and rarely works in these types of situations.

• Option #3 – Lease Option Sale

This is an option where you can negotiate a lease option with your tenant/buyer. This way, the tenant can improve their credit, increase their savings, and eventually purchase the property.

• Option #4 – Pay The Difference

You can sell the property and pay the difference in the amount owed and the amount you can sell it for. Some ways you can pay this difference are, out of pocket or if you have other investment properties, you can borrow the difference amount against your other rental property.

Credit Ding Options

• Option #5 – Foreclosure

If your bank does not accept your hardship letter and short sale request, you can default on your payments and allow the bank to repossess your home. This last resort option will hurt your bank(s) and yourself. This option can leave you vulnerable to a deficiency judgment(s) depending on whether your state is a recourse or non-recourse state. For more information, read my previous article here.

In this situation, your credit score will receive an 85-160 (varies upon situation) point reduction and you will have a foreclosure stamped on your credit report. With a foreclosure, you will not be able to obtain another mortgage for at least a few years or typically, a 7 year period.

• Option #6 – Short Sale

This has been the most popular option for investors. If you can show legitimate hardship or foreseeable hardship, your bank may allow you to short sale where you can sell your property for less than what is owed, avoid foreclosure and walk away from the property with little to no remaining debt. The key is to find a pro negotiator in your area who is well connected with banks and can negotiate the deficient amount despite having other assets.

This is preferable by banks and the short sale is translated on your credit report as “paid for less than original amount.” You will be able to obtain another mortgage in some cases immediately or on average, 24 months.

Tax implications

One of the most important factors when walking away from your investment property whether it is via short sale or foreclosure, are the subsequent tax implications. The IRS deems the forgiven amount (deficiency) as “taxable income” unless it is your primary residence in which you would be able to exclude the income through the mortgage forgiveness debt relief act.

If however you are able to show insolvency where your total liabilities exceed your total assets or if the debt was discharged in a Title 11 bankruptcy, you can exclude the forgiven amount regardless of it being a second home.

Short selling your rental property with little liability is difficult to do if you do not have an experienced agent who is well connected with banks. Our agents have been VERY successful in getting our investors out of their bad investment situations. If you are in Washington State, connect with our experts today to discuss your best option for your situation.

Hope this helps

Peter

Let’s Take a Ride

I can't find the HELOC and seller does not know says he got notice it was being sold from PNC but never to whom.  MERS has two Bof A loans down but when I call they say they do not have a second for it.  Any ideas?

I was reading about short sales, as I do every Sunday morning on a great site for short sale information Short Sale Superstars. There was a discussion about a Bank of America Short Sale that had been approved, and then denied after the approval, a few days before closing. The reason:

The seller was a real estate broker and the listing agent works for the seller. The buyer used the listing agent to represent her.

Surprise Surprise, B of A said this is not an Arm's Length Transaction and rescinded the approval.

There are multiple things wrong with transaction so let me see if I can organize the problems coherently.

1. All short sales must be an Arm's Length Transaction and an affidavit needs to be signed by all parties saying they are not related to each other in any way. The listing agent works for the seller so that is not arms length.

2. The seller may be offered a closing incentive by the bank, but is not allowed to receive any money from the buyer. Since the buyer is using the the listing agent who works for the seller and would have received commission for the sale, a portion of which would go to the broker, then the seller is getting money from the buyer.

3. Again, since the listing agent works for the seller and would get commission from the sale, a portion of which would go to the broker, the seller would be receiving money from the sale outside of the closing incentive.

4. The buyer has agreed to a dual agency and is entitled to the information that the listing agent works for the seller and that this can cause potential problems with The Arm's Length Transaction.

I do not know if the seller was trying to pull something over on the bank, or if he was just not familiar with short sales but this was totally avoidable.

Buyers: get your own agent to represent you.

Sellers: If you are a broker, get a different company to represent you. If you are an agent, get another agent to represent you, not your broker, and ask the bank if it is ok to be represented by someone else in your campany first, not after you are about to close.

If you have any questions about buying or selling a short sale in Santa Clara or San Mateo County please feel free to contact me.

Marcy Moyer

Keller Williams Realty

www.marcymoyer.com

marcy@marcymoyer.com

650-619-9285

D.R.E. 01191194

Palm Lakes Short Sale CLOSED!

Another Short Sale Listed, negotiated and CLOSED by the Desert’s Short Sale specialist.  This cute condo at Palm Lakes in Palm Desert was a B of A COOP short sale.

What’s a COOP short sale?  Co-operative.  That means Seller was pre-approved for the Short Sale, the List Price was the pre-approved net number to the Investors, so once it was listed and I got an offer, the process was much more efficient.

Listed to Close in just under 60 days.

One Note, Primary Residence.  No cost to Seller and Seller received $5,000 in Relocation fees from B of A at the Close of Escrow!

Looking for an experienced Short Sale List Agent?  Give me a call for your free property consultation…760-285-3578   kjkpolo@gmail.com

Good morning Superstars.

Here are this week's Superstar discussions.

Discussions	Replies	Latest Activity
Multiple Offers on a Short Sale Listing Once an executed contract has been submitted to the lender and another offer is submitted on the property, how is the 2nd offer supposed to… Started by Allen Faires	5	2 hours ago Reply by Kevin - Greenville, SC
BofA rescind short-sale approval one day before closing! Buyer needs HELP!!! I'll try to describe my situation in as few words as possible. Earlier this year I started the buying process on a Bank of America short sa… Started by Luke Kelly	4	7 hours ago Reply by Sheyenne Schultz
Client not given reason why short sale was declined, how can we find out? No one at BOA seems to know why my client's short sale was declined. We need to find out - he can't afford the house and from what I see, h… Started by Dawn Maloney	3	8 hours ago Reply by Sheyenne Schultz
Nationstar Mortgage HELP !!! I need a contact to Nationstar the investor is Bank Of New York via EQUATOR I have a short sale that I am working on. They will no… Started by Rosalinda Hernandez	6	8 hours ago Reply by Sheyenne Schultz
Office Policy Qualifications for Agents Who Do Short Sales Wondering if any of you have a document in your office that you would be willing to share, that spells out what the minimum office requirem… Started by Deb Orth	2	12 hours ago Reply by Deb Orth
Need answers please help... and are charging the buyer $2300 in attorney fees on behalf of the seller. Also tried to get me to lower their offer but get the buyer to p… Started by Sylvia Montoya Knight	4	yesterday Reply by Smitty
Make too much for Short Sale Its John P again, one more question but on the opposite side, We of course have a house that is underwater, but current on the payments, an… Started by John P	10	yesterday Reply by John P
Will BOA process a VA short sale while payments are current? Does anyone have any information as to BOA's VA loans with payments that are current? Any experience with this? Started by Kristy Hamilton	2	yesterday Reply by Wendy Rulnick

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We have also had more than 1,000,000 unique visitors to the site. Short Sale Superstars is the most visited public Short Sale Network on the planet.

How awesome is that? My guess is that with your help we have been able to help 1,000s of people avoid foreclosure. THANK YOU!

As a small token of our appreciation we are giving you, for free, our Advanced Short Sale Training Session on Lead Generation. CLAIM YOUR FREE LEAD GENERATION TRAINING HERE (1 hour seminar with marketing materials including sample marketing letters. This is not a sales pitch. It's a gift)

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This will give you a total cost of $147.00 for 13+ hours of Advanced Short Sale Training and a 2 year membership into the Advanced Training Group on Short Sale Superstars.

You can find more details here.

Bank of America is Offering To Pay Off Second Mortgages?|Carson|  Leesa Hammond

As part of the National Mortgage Settlement, Bank of America announced on Friday that it is in the process of  mailing approximately 150,000 letters to their pre-qualified homeowners offering to cancel their second mortgage.  The intention of Bank of America is to help improve the financial position of the homeowner by decreasing their monthly payment obligations and potentially creating an equity position in the property. Bank of America began mailing these notices to their qualified borrowers in July and will continue through December 2012. The letters will notify eligible homeowners that the full balance of the second lien mortgage will be forgiven and the lien removed and cleared.  The borrower does have the option to call the bank to decline the offer within 30 days of receiving the letter.    Hmm... isn't that interesting.

What is the criteria to have the second mortgage forgiven?

• Mortgage must be owned and serviced by Bank of America
• Eligible borrower must be severely delinquent
• Second mortgage must meet certain threshold of delinquency or property value criteria
• Does not matter who owns and services the first lien mortgage
• Only borrowers who receive the mortgage elimination letters are eligible

Downsides for the borrower:

• Unless you received second lien mortgage forgiveness letter, customers can not request to be part of the program
• If the borrower is currently in foreclosure the elimination of the second mortgage will not stop the foreclosure from proceeding
• Possibility of a tax liability, there are some exceptions  – always check with your tax advisor

Good news:

• Bank of America will report the account paid and closed on the borrower’s credit report
• Bank of America will NOT pursue the homeowner for a deficiency judgment

Bank of America will continue to help customers who are in need of assistance with their mortgage. Contact Bank Of America's customer call center or by visiting them on the web to find out about other available programs.

mrsleesa@gmail.com

Leesa Hammond

Century 21 Amber

(310) 890-4439

Bank of America is Offering To Pay Off Second Mortgages??? | Carson| Leesa Hammond

Bank of America is Offering To Pay Off Second Mortgages??? | Carson| Leesa Hammond

Bank of America is Offering To Pay Off Second Mortgages??? | Carson| Leesa Hammond

Bank of America is Offering To Pay Off Second Mortgages??? | Carson| Leesa Hammond

What is Mortgage Insurance?                        

Mortgage insurance is a financial guaranty for the lender that will help to reduce or eliminate a loss in case the borrower defaults on their mortgage. MI is almost universally required on loans where there is less than twenty percent equity. That means if you are purchasing a home with less than twenty percent down or refinancing to more than eighty percent of your homes value, you are going to be required to pay mortgage insurance. To be put simply, mortgage insurance spreads the risk between the lender and the insurance company.

The Two types of Private Mortgage Insurance

Borrower-Paid Private Mortgage Insurance (BPMI) – This is default insurance on mortgage loans paid for by borrowers.

Lender-paid private mortgage insurance – This is similar to BPMI except it is paid for by the lender. The lender will go ahead and insure themselves if they feel it behooves them.

How can this affect a short sale transaction?

When processing a short sale with one of the loans having Mortgage Insurance the file will have to be reviewed by not only the.. For the entire article click here

SHORT SALE HOUSE UPLAND CA

If you are facing foreclosure and you can no longer afford your home, you may qualify for a Upland CA Short Sale, even if you don't think you can or don't think your home can be sold in today's market.

What is a Upland CA Short Sale?

A Upland CA Short Sale, also known as a pre-foreclosure sale, is when you sell your Upland home for less than the balance remaining on your mortgage. If your mortgage company agrees to a short sale, you can sell your Upland CA home and pay off all (or a portion of) your mortgage balance with the proceeds. You may also be eligible for the government's Home Affordable Foreclosure Alternatives Program (HAFA) which offers incentives for sellers to complete a short sale.

A Upland CA Short Sale is an alternative to foreclosure and may be an option if:

• You are ineligible to refinance or modify your mortgage
• You are facing a financial hardship, including loss of job, death, divorce or medical expenses
  
• You are behind on your mortgage payments
• You owe more on your Upland home than it’s worth
• You have not been able to sell your home at a price that covers what you still owe on your mortgage
• You can no longer afford your Upland CA home and are ready or need to leave

What are the benefits of a Upland CA Short Sale?

So Call us Now: (888) 9-List-It.

That's (888) 954-7848.

Or click here to access our Real Estate Short Sale Formula to evaluate your particular situation.

MURRIETA CA SHORT SALE REALTORS

Murrieta CA Short Sales Made Easy…

You Pay Nothing For Our Murrieta CA Real Estate REALTOR Services!

SHORT SELL THAT MURRIETA CA HOUSE NOW! CALL: 1 (888) 9 LIST-IT

-Is your Murrieta CA house worth less than you owe?

-Having trouble paying your Murrieta CA mortgage or are you already behind?

-Have an Adjustable Rate Mortgage, or a Negative Amortized Loan?

-Are you concerned about tax implications? -Do you have questions about how short sales work?

Many Murrieta CA home owners are short selling their upside-down Murrieta CA properties and so can you!

We are Certified Foreclosure & Short Sale Specialists and we can help you sell that upside-down Murrieta CA House!

YOU PAY US NOTHING CALL NOW: 1 (888) 9-LIST-IT

Or email us at:

GarrigusRealEstate@yahoo.com

We also handle:

-Murrieta CA Standard Sales

-Murrieta CA Foreclosures

-Murrieta CA Property Sales

-Murrieta CA Home Buyers

GRAND TERRACE CA SHORT SALE REALTORS

Grand Terrace CA Short Sales Made Easy…

You Pay Nothing For Our Grand Terrace CA Real Estate REALTOR Services!

SHORT SELL THAT GRAND TERRACE CA HOUSE NOW! CALL: 1 (888) 9 LIST-IT

-Is your Grand Terrace CA house worth less than you owe?

-Having trouble paying your Grand Terrace CA mortgage or are you already behind?

-Have an Adjustable Rate Mortgage, or a Negative Amortized Loan?

-Are you concerned about tax implications? -Do you have questions about how short sales work?

Many Grand Terrace CA home owners are short selling their upside-down Grand Terrace CA properties and so can you!

We are Certified Foreclosure & Short Sale Specialists and we can help you sell that upside-down Grand Terrace CA House!

YOU PAY US NOTHING CALL NOW: 1 (888) 9-LIST-IT

Or email us at:

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We also handle:

-Grand Terrace CA Standard Sales

-Grand Terrace CA Foreclosures

-Grand Terrace CA Property Sales

-Grand Terrace CA Home Buyers

“Walking away from my property” is a phrase often used by struggling homeowners who are considering allowing their homes to fall into foreclosure. However, the phrase does not accurately depict what negative effects a foreclosure actually has on a borrower’s situation yet many believe that it is as simple as letting your home fall into foreclosure and walking away. That is certainly an understatement and I will tell you why.

Think about the basic situation. You borrowed money from X (lender one) and Y (lender two assuming you have 2 liens) and later you tell both X & Y you are unable to repay your debt. So you “walk away” from the situation. Would X & Y just accept the loss and wave their hands while you leave the situation? No. Here is what they will do.

Recourse & Non Recourse State
There are different foreclosure laws in every state. This determines what the lender can legally do in the event a borrower doesn’t pay the owed amount. In a recourse state, both X & Y are able to pursue you for the remaining balance even after your home is foreclosed on. In a non-recourse state, X is not able to pursue you legally BUT Y can and probably will come after you for the remaining balance. In other words, if you have a second mortgage (2nd lienholder) on your property, they can still get their money back.

Credit Reporting
If you “walk away” from your home and debt owed to X & Y, don’t you think they will tell A,B,C, and all other future lenders of what you did? However you handle your debt owed now will put on your credit report for future lenders to see. You will have either a “foreclosure” stamped on your report which means you really did just walk away from a bad situation or you can have a “paid for less than original amount” aka a short sale on your report which shows to A,B,C that you put effort in settling your remaining debt with X & Y rather than walking away from them.

What you decide to do now will be put on paper either way. If you “walk away,” it may be easier now but harder later in various ways such as not being able to obtain another mortgage and/or a possible lawsuit.

Keep in mind that lenders WANT you to do a short sale. You may be wondering, “well I can’t afford to do a short sale…” This is a myth my friends. If you work with the right short sale agent, you shouldn’t be paying a penny. In fact, lenders typically pay YOU for doing a short sale and it can be up to $30,000 if you do.

In this 2012 year with all of the laws and lender practices now supporting homeowners who take the time to short sell their home, simply walking away from your home will make a strong statement to all who take a look at your credit report (future lenders, bosses, apartments for rent and etc.)

If you live in Washington state, our short sale experts will show you how you can settle with your lenders and walk away with little to no liability. Connect with us HERE and we will contact you within 24-48 hours.

Hope this helps

Peter

I'm working w/ PHH and the financial consultant/doc gathering person is moving slow the 1st 30 days. Does anyone have any current contact #'s for a supervisor in Loss mit or Short Sale escalation? Thank you- Bob