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It is estimated that about 25% of home in the US are underwater, that is the owner owes more on the mortgage than the home is worth. So if the owner has to sell, they would have to either make up the difference or do a short sale.

However, just being underwater is not enough reason for most banks to do a short sale. They want to know you have a hardship. what is a hardship?

there are a number of reasons that banks will accept as a hardship. they basically want to know what has changed since you purchased the home. some examples of hardships would be:

1. Job loss

2. Relocation

3. Death in family

4. Illness in family

5. Increased expenses from things like debts or an increase in mortgage payments

6. Divorce

So basically if your income has decreased or your expenses have increased or you need to leave your home it is a hardship. there are others, but they all have in common that something has changed in your financing or circumstances from when you purchased or refinanced your home.

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

Marcy Moyer

Keller Williams Realty

www.marcymoyer.com

marcy@marcymoyer.com

650-619-9285

D.R.E.  01191194

This was a Non-GSE mortgage.

Here is the answer: The HAMP Solutions Center is established under Fannie Mae and located in Dallas TX. What I found out was that any email with attachments (I had included an Authorization Form signed by the Borrowers  and a statement of the case history with supporting documentation) originated form a non-company or non-business ISP (gmail, yahoo, cox, verizon, comcast, etc.) is treated by Fannie Mae as unfriendly email and strips off any attachments and then sends you an email stating the following:

Subject: Undeliverable:FW:Request for Escalation Assistance with Bank of America/AMS

on a HAFA SS

Date: Thursday, September 29, 2011 1:29:33 PM ET

From: postmaster@fanniemae.com

To: dduft@comcast.net

This message originally contained an attachment, which was removed per Fannie

Mae policy.

This leads one to believe the email was not delivered - when in fact it was & I received an encrypted email from the HAMP office which stunned me at first as to how to open it as it needed a password. I decided to click on the forgot PW link and that allowed me to "reset" my PW which I never had in the first place. The email let me establish a new password without having the original and Wallah - the email opened. Basically this advised me that they would assist however I needed to use their specific forms for Authorization and Case History, to go to their web links to retrieve their unique Third Party Authorization (https://www.hmpadmin.com/portal/hamp_servicer/thirdparty/authorization.doc) and Case Submission(https://www.hmpadmin.com/portal/resources/docs/counselor/casesubmission_v3.pdf) forms. 

Once completed and signed you can submit by email to escalations@hmpadmin.com or fax to 240-699-3883. Once received they agree to give you start the escalation contact and provide an update within 7 days.  I will let you all know how it goes.  

PRESENTING THE SHORT SALE ADDENDUM YOU CAN'T SIGN!   Agents hold on to your wallets as this could cost you big time!  This is just too big and important to let one blog article suffice.  And developments on this are occurring quickly.  The problem was pointed out in my ActiveRain re-blog Freddie Mac Short Sale Addendum - Item #13 - I DON'T THINK SO!! on September 9, 2011.

On September 3^rd there was a telephone conference call between ALTA (American Land Title Association) staff in Washington, DC and Freddie Mac’s Short Sale team to specifically discuss the addendum reproduced in Freddie Mac Short Sale Addendum - Item #13 - I DON'T THINK SO!! .  No resolution was then reached and as of today, none has been presented.

According to the below emailed alert to certain ALTA members (including our title underwriter), the problem with the document goes much further than even reported in my earlier blog article.  ALTA points out that (1) the document requires closing and escrow agents to certify information that is not available to them; (2) the document places a negligent misrepresentation standard on the escrow / closing agent that requires the escrow / closing agent to use reasonable efforts to determine if the transaction is arm’s length – without setting forth what those reasonable efforts would or could be; and (3) the document requires that the document be signed by the escrow / closing agent individually, without corporate protection, meaning that if there is a loss because of fraud or misrepresentation by any party to the transaction, the agent could be fully and personally liable. SINCE REAL ESTATE AGENTS ALSO SIGN THIS DOCUMENT, THE SAME LIABILITY AND RISK AFFECTS THEM AS WELL.

I am checking with my E&O carrier to see if they will cover such a claim.  If they don’t, then I cannot risk my own capital and family wealth for the meager fees of a short sale closing, and I suspect anyone who actually realizes what this document does, also will not close such a sale.

For any of you that think this is negotiable, here is a response I got today when I told a Bank of America negotiator on a Freddie Mac loan that I can’t sign if the E&O won’t cover the claim. “Thank you for letting me know.  Without the document we cannot proceed with the short sale and must decline the file.  How long do you think it will take for your E & O carrier to make a decision as to allow you to sign the document?  I cannot have any outstanding files, so should I decline the file at this time or do you think this is something that can be checked on quickly?”

Fraud is a big problem with some markets of distressed property and I have written about it in several articles - often times with flipsters phoo phooing the concept as being fraud: SHORT SALE FLIP - QUESTIONABLE METHODS;  Short Sales and Title Insurance - Critical Look at Hybrid Closing Schemes;  IS SHORT SALE FLIPPING CRIMINAL ACTIVITY?.

ALTA is looking for examples where the Addendum is causing hardship to borrowers and consumers.  If you have any please send the information to Steve Gottheim, Legislative and Regulatory Counsel to ALTA at steve@alta.org.

Here is the information transmitted by ALTA:

 ALTA Meets With Freddie Mac Short Sale Team About Troublesome Addendums
On Friday, ALTA staff held a conference call with members of Freddie Mac's Short Sale team about the industry's concerns over new short sale addendums. These addendums are intended to help prevent short sale fraud (which is on the rise) by requiring all of the parties involved in the transaction to sign an affidavit attesting that it is a true arms-length transaction.

The addendums present three concerns for the industry. First, the affidavit requires a closing or escrow agent to certify information that is not available to them, in particular whether the transaction is arms length. The relationship between the buyer and seller may not be evident from the public record information or their identification documents. Second, the affidavit places a negligent misrepresentation standard on the escrow agent. Unlike a "to the best of my knowledge standard" a negligence standard requires the escrow agent to use the reasonable efforts of an ordinary person to determine whether the transaction is arms length. Instead of laying out clearly what the escrow agent must do to release themselves from liability, the escrow agent is at risk of liability if fraud is discovered after signing the affidavit. Lastly, the affidavit requires the escrow agent to sign the transaction in a personal capacity as well as in a corporate capacity. Thus if fraud is discovered, then Freddie or the servicer can go after the escrow agent's personal property and monies in addition to going after the corporation.

Before signing any of these addendums, ALTA suggests escrow agents reach out to their attorneys to discuss the legal risks and whether the agent has the authority to sign the document. It might also be good practice to review your companies E & O insurance policy to determine whether these addendums are within the scope of that policy.

While the short sale team expressed sympathy for the title industry's concerns and were open to discussing potential solutions, Freddie's general counsel is not keen on removing the requirement all together unless the problem becomes a bigger issue. Over the next few weeks, ALTA staff will be working with interested parties to develop potential solutions. If you would like to learn more or have any comments please contact ALTA's Legislative and Regulatory Counsel Steve Gottheim at steve@alta.org

I have still not heard from my errors and omission carriers on this issue.  An initial "from the hip" reaction was that E&O did not cover this as it was not the performance of legal services.  But the respondant did not realize that a "short sale facilitator" is just the title on the document and we have a written retainer with the client to perform legal services including legal advice and guidance on the completion of these and the other myriad forms.  So "the jury is still out".

________________________________________________________________________

Copyright 2011 Richard P. Zaretsky, Esq.

Be sure to contact your own attorney for your state laws, and always consult your own attorney on any legal decision you need to make.  This article is for information purposes and is not specific advice to any one reader.

Richard Zaretsky, Esq., RICHARD P. ZARETSKY P.A. ATTORNEYS AT LAW, 1655 PALM BEACH LAKES BLVD, SUITE 900, WEST PALM BEACH, FLORIDA 33401, PHONE 561 689 6660   RPZ99@Florida-Counsel.com - FLORIDA BAR BOARD CERTIFIED IN REAL ESTATE LAW - We assist Brokers and Sellers with Short Sales and Modifications and Consult with Brokers and Sellers Nationwide!  Shortsales@Florida-Counsel.com  New Website www.Florida-Counsel.com. 

See our easy to understand articles at:

TABLE OF CONTENTS - SHORT SALE AND LOAN MODIFICATION ARTICLES

Got an expired listing that was priced too high and scheduled for auction in 20 days. I priced it aggressive, yet competitive. Received an offer within 2 weeks.  The bank cancelled the auction and is negotiating the short sale. Very happy sellers!

FHA has specific rules when it comes to purchasing a home that is in Pre-Foreclosure with a FHA mortgage on it.  FHA doesn’t make mortgage loans, they Insure them – and so as the Insuring Agency (kinda’ like a PMI company) they get to set the rules!  In those Pre-Foreclosure, Short Sale transactions, they set out what fees CAN be included from the Seller, and which fees can not.

 Pre Foreclosure Seller Fees per FHA

The process for purchasing a FHA Short Sale is similar to other short sale situations in that the HUD-1 must have prior approval.

The item people need to realize, though, is that if the buyer is obtaining a FHA mortgage,  the Seller can only pay up to 1% of the Buyer’s First Mortgage Amount.

We don’t have that many of these cases in the Raleigh, Holly Springs, Cary, Apex area – but when we do, the buyer needs to remember that they will probably need a little more cash upfront for the purchase.

If you are considering a mortgage loan in North Carolina, and you want more details on FHA  Mortgage Loan Guidelines – please call Steve and Eleanor Thorne, 919-649-5058 Raleigh FHA Mortgage Loan Specialists!  We have over 20 years of experience providing homebuyers with the BEST mortgage rates available!

My husband and  are just embarking on the shortsale route. Our home is worth about $30,000. less than we owe. We both get a government pension. Can the bank get any of that money from us? Also what about tax refunds, can the bank take that money? Thanks!

Hi Everyone,

I just want to tell everyone about my success with an IndyMac shortsale. The property was in good condition. There were two liens on the property (same bank). I had excellent Sellers because they cooperated in everyway they were asked to. IndyMac was very responsive with responses within 10 days. Midway through, the contact negotiator changed and so then everything had to be resubmitted because it had been some time since the first submission. I used their shortsale package from their website and made sure the loans were referenced in all pages (bottom righthand). The second negotiator took more time to get back and their letter to my client indicated that they would do so within 30 days. After about 3 weeks, I received a response and everything went smooth from there. We closed in 10 days. The entire process did take about 6 months because the first time an offer was submitted to them they wanted a higher price and time passed as we waited for an offer to materialize when the first one walked.

But I did not technically wait for an offer. I got busy pitching it, door knocking, holding open houses, contacting everyone possible to let them know it was available and praying alot. One item of interest is that IndyMac did not like that my client vacated the property and my client had to move back to safeguard the home. The asset manager had someone enter the property with a master key which my client was not happy about. However, my client did write them a letter to let them know that they would continue to stay in the property so it would not be vandalized. Besides that and the long wait for a buyer to materialize, things went very well.

Hope this provides some hope to others.

Sold the above properties representing the bk sellor as "Debtor in Possession". Had several properties to dispose of , all in the state of California and in ch 11 bk. Sold properties were BofA loans from CountryWide and processed through "Equator System". Takes time and patience.  

Dealing with a short sale where we have waited with our buyers for an approval over three months. We were told it could take up to five months to get an approval or decision. All of a sudden we received a verbal approval last week. Chase Bank is the first and second. We were told from the title company doing the communications that Chase had just recently changed it procedures to have the first tell the second what they will receive thus alleviating the need to wait on a decision from the second. This has reduced the waiting time. It just makes sense that a bank should do this. Why argue with yourself?

Hello Group-

I am gathering information on experience with servicers in relation to share best practices when Mortgaghe Insurance is involved. I am hearing some pretty intriguing things that are occuring which SHOULDNT be.... does anyone have anything to share?

i.e.

Radian requested $40,000 note and ended up killing deal.

Servicer would not share who MI company was.

 MI company stated the decision is based up to servicer.

MI companies have over 100 different types of policies to offer.

etc.....

Janet and I have been doing shout sales for over 3 years now and have a 98% success rate to approval.

What we are running into now are sellers with a big case of denial.  Denial is the major reason sellers don’t reach out for help.  The NOD is filed and with head in the sand the seller can’t move.  Sellers must take action before they start missing payments, getting a jump on the selling short will help in getting out-from-under a toxic mortgage.

Are best advice is, don’t wait until the banks comes a knocking, you can make the first move… Janet can help www.Shortsalebyjr.com 

Milpitas Single Family homes

Active Short Sale Listings:  23

Active Bank Owned Homes: 9

Pending Short Sale Homes: 49

Pending Bank Owned Homes: 11

Sold Short Sale Homes: Last 6 months 23

Sold Bank Owned Homes: 19

Milpitas Condo Townhomes

Active Short Sale Listings: 12

Active Bank Owned Condos:  4

Pending Short Sale Condos/Townhomes: 43

Pending Bank Owned Condos/Townhomes: 4

Sold Short Sale Condos/Townhomes: 19

Sold Bank Owned Condos/Townhomes 26

Unlike San Jose, where short sales far outnumber bank owned transactions, the numbers are much closer for short sales and bank owned homes in Milpitas. There are many more pending short sale listings than bank owned, but short sales take so much longer to close that number is not surprising.

If you have any questions about short sales or foreclosures in Milpitas please feel free to contact me.

Marcy Moyer C.D.P.E.

Keller Williams Realty

www.marcymoyer.com

marcy@marcymoyer.com

650-619-9285

D.R.E.  01191194

Novi MI MACPA's Short Sale Guru, Mike Sher to teach at The Michigan Association of Certified Public Accountant's Construction Industry Conference
In Novi September 27, 2011

Mike Sher will be this years Short Sale Expert Speaker for the MACPA's Michigan Conference September 27th in Novi MI

Mike will be speaking about the Strategies Short of Foreclosure: Real Estate, Short Sales and Beyond.  To learn more about Mike Sher check out his blog.

You can contact Mike Sher at his Max Broock Office (248) 644-4700 or email him at ShortSale@mikeRealtor.com

I’m excited about acting as a resource for more homeowners who have questions about what they should do. As always, if you know homeowners who may need my help, have them contact me immediately! Together, we can put them back on the path to financial stability.

The Mike Sher Team has assisted homes-owners in over 100 short sale payoffs.  We work with all banks and can help homeowners get out from under their loan(s)!   Most homeowners do not get a 2nd chance with a short so seek a Realtor with a long track record of succes.  Request references and ask lots of questions.  You do not want to find out too late that they are unable or unqualified to help you.

Mike Sher, Max Broock Realtors (248) 496-1572

If you receive an approval letter stating the following -- will you still be 1099'd as income on the it:

Upon receipt of the agreed amount, BAC Loan Servicing and/or its investors will waive the remaining balance due on the above referenced loan and release the borrower from further obligagion therein, and waive all rights to pursue further judgment or deficiency.



This is a BofA Short Sale.  Should get an offer tomorrow, but have 30 days to bring it to closing.  Seller moving and will not be back for at least a year or mayble more.  No family to assign power of attorney.  Any ideas, comments, solutions for this critical scenario.  Help...

Anyone out there have a comment about how long it takes to be assigned an negotiaor from Indymac. I received seller acceptance for a SS offer on 7/12/11 The complete package was submitted days later and still no negotiator.  I read other posts that said they are 90 days behind.  

Any Arvada Agents out there listening? I am out here in San Diego and a gentleman was transferred here for his job and is upside down on his home in Arvada. One loan and is worried about deficiency and pursuit by the bank. I would like to help him find a home here, so he may just decide to rent the house out, but if the market doesn't improve, he may not be able to hold onto that house in Arvada since the rent will probably not cover the payments. 

Here in CA, we have laws protecting the short sellers against deficiency pursuit on the primary residence. I am on track to do 20 short sales this year here in Southern California and no deficiencies. Anyone have success negotiating away deficiency pursuit on short sales in Arvada?