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Real Estate Marketing "The Podcast" How do I get listings or deals? #Investor #Realtor

David Bartels LIVE from Anaheim CA presentation

805-413-8000
http://www.homeloanadvocates.com/

Banks grant short sales for two reasons: the seller has a hardship, and the seller owes more on the mortgage than the home is worth.

The seller will need to prepare a financial package for submission to the short sale bank. Each bank has its own guidelines, but the basic procedure is similar from bank to bank.

A few examples of a hardship are:
Unemployment / reduced income
Divorce
Medical emergency
Job transfer out of town
Bankruptcy
Death

The seller’s short sale package will most likely consist of:
Letter of authorization, which lets your agent speak to the bank.
HUD-1 or preliminary net sheet
Completed financial statement
Seller’s hardship letter
2 years of tax returns
2 years of W-2s
Recent payroll stubs
Last 2 months of bank statements
Comparative market analysis or list of recent comparable sales

Writing the Short Sale Offer and Submitting to the Bank

Before a buyer writes a short sale offer, a buyer should ask his or her agent for a list of comparable sales.

Banks are not in the business of giving away a home at rock-bottom pricing. The bank will want to receive somewhat close to market value.

The short sale price may have little bearing on market value and may, in fact, be priced below the comparable sales to encourage multiple offers.

After the seller accepts the offer, the listing agent will send the following items to the bank:
Listing agreement
Executed purchase offer
Buyer’s pre-approval or proof of funds letter and copy of earnest money check
Seller’s short sale package.

The Short Sale Process at the Bank

Buyers may wait a very long time to get a response from the bank. It is imperative for the listing agent to regularly call the bank and keep careful notes of the short sale process.

Buyers may get so tired of waiting for short sale approval that they may feel the need to threaten to cancel if they don’t get an answer within a specified time period.

That type of attitude is self-defeating and will not speed up the short sale process. If buyers are the type with little patience, perhaps a short sale is not for them.

Following is a typical short sale process at the bank:
Bank acknowledges receipt of the file.
A negotiator is assigned.
The bank orders a valuation of the property.
The file is sent for review or to the investor.
The bank may then request that all parties sign an Arms-Length Affidavit.
The bank issues a short sale approval letter.

Some short sales get approval in 3 weeks. Others can take as long as 12 months. A typical Short Sale transaction takes 4-6 months to complete.

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Real Estate Marketing (The Podcast)

How do I get a listing or deal? #Investor #Realtor

Short Sales are BACK!

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GUESTS: 
Bryant Tutas 
407-873-2747 
Co-founder of www.ShortSaleSuperstars.com. Working Short Sales every day all day.

Real Estate Broker and Owner of Tutas Towne Realty. A virtual Real Estate company specializing in listing and selling Short Sales and REO properties in the Central Florida Area.

Finding solutions that get your property “sold” is what I do.

Folks, if you need to sell your home then give me a call today and let’s talk! 407-873-2747 All calls are confidential. I can help……

….if you’re facing foreclosure. www.CentralFloridaShortSales.com 
….if you need to sell a Holiday Home. www.BuyProperty.ning.com 
….expose your property to over 500 web sites. www.TutasTowneRealty.com 
….educate you on current market conditions. www.BrokerBryant.com

Mike Linkenauger 
904-733-4911

Main website http://www.short-sale-specialists.com

Short Sale Websites - www.ShortSaleHosting.com
Mike got his start in Real Estate in 2005 at the young age of 26. He immediately established himself as a top producer in the Jacksonville, FL market, moving into the top 1% of agents his first year in the business. As the Florida housing market became depressed in 2007, Mike shifted his focus and immediately found a calling in assisting home owners with a short sale. In no time he amassed an inventory of over 100 short sale listings and quickly established himself as one of the top short sale agents in the State of Florida. As his online presence grew, homeowners from other parts of Florida began contacting him for guidance with a short sale and to be connected with a local short sale agent.

Because I am very active in Short Sales in the Portland, OR metro area, I get all kinds of questions by email and phone.

As much as possible, I try to keep the questions and answer in email form.  One of the most common questions I get is:

"should I short sale or not".  My answer is almost always "it depends".  Basically, whether a short sale is a good strategy to unload a property, or not, depends on the specific situation.  The email sequence below is a good example of this.

Email Sequence:

Customer questions are in navy.  My replies are in blue.

Hi -

I have an initial question on my possible options. I got divorced 2 years ago and still jointly own a house with my ex wife, which is under water by aprx $55k, I owe $260k. I am current on my mortgage.

I have a first for $200k and a second for $60k. My problem is I could afford to pay the defect, but don't want to pay her 1/2. Additionally I'd like to not impact my credit or damage my chances of buying a new house in the next few years.

Please could you let me know possible options from your perspective, so I can begin a plan on selling my house.

Thanks.

Ken

Ken,

Thanks for contacting me. 

It seems to me you are not much underwater.  Maybe you need to buy her off the title and keep the house.  The ticket is to do it now rather than when there is equity, because you will get there.  At that point she will want her cut, even if she is not paying now.  Cash plus resentment area bad combo.

Is the property vacant?

Another option is for you to pay the short fall of the sale if you want to sell with no default.   That would be around $80K by the time you add the second mortgage, the unpaid part of the first, the real estate commissions and other things.

Hopefully this helps.  For a short sale you need to default.

Oscar

Thanks for the quick response Oscar. The house is not vacant, I am actually currently residing there.

I assume that default is the worst possible option and would completely ruin my credit (and potentially leave me exposed to lenders wanting to come after debt recovery)?  I have a feeling this would be my ex's preferred option, which I want to steer clear of. Do you know if a default in her name would impact her new husband or just limit their future lending options as her credit will be poor (that could be a good deterrent).

I guess my other option could be to buy her out, then potentially look at renting it, although my mortgage is currently at 6.5% :(

Thanks again.

Ken

Ken,

It seems you are better off buying her out.  You will have to pay for rent or mortgage anyway.  Offer her $2K for getting out of the title.  Do it at a title company.  I can connect you.

Don't take this as legal or tax advice.  Just a pointer.

Let me know if you need anything else. 

Oscar

Oscar Morante
Ph:  971-222-3734
Fax: 866-844-7009
PDX Experts Real Estate, LLC
www.PDXExperts.com
534 SW 3rd Avenue
Suite 305
Portland, OR 97204

Real Estate Agent
Realtor

Looking for a Rent-to-Own, Lease-Option or Land Contract in Wisconsin? We may have the perfect option for you! It's called the Alternative Mortgage Program. Please read the details below and visit the link for further information.

As you can see, this is much different than any other Wisconsin Rent to Own (RTO) or Land Contract program out there that we have seen. This could be the perfect conduit for you to get the home you want now, and be able to then purchase the house down the road when you can qualify for a traditional mortgage. If you are interested in hearing more about the program from the lender, please visit the link below and submit your contact information via the short form.

Blog.RockRealtyWI.com/Rent-To-Own

Feel free to also visit our Rock Realty Wisconsin home listings websites below to help with your home search! You can search through all available MLS listings in your area.

Janesville Area Homes for Sale
(http://www.JanesvilleRealtor.com)

Madison Area Homes for Sale
(http://www.MadisonWIForSale.com)

Exciting News! FHA Is Allowing People that Suffered through Recent Economic Hardships to Apply for a Home Loan with the FHA Back to Work Program.

In the not so distant past people had to wait 3 years or more after suffering through a financial hardship. Bankruptcy, foreclosures and other major financial disasters would sideline people for a number of years before they could buy a house again. However, all that has changed with the FHA Back to Work Program.

Previous Guidelines

For years the FHA program has helped people finance the purchase of a home with a modest 3.25% down payment. In general, the FHA rules for credit and employment history were more forgiving than conventional loan guidelines. However, there were strict rules about waiting a significant length of time after filing bankruptcy, losing a home to foreclosure, getting a loan modification or a deed-in-lieu.

New Guidelines

The Back to Work program waives waiting periods based on certain hardship situations. People that have suffered through the following types of problems are no longer forced to wait multiple years to apply for an FHA loan

* Bankruptcy (either Chapter 7 or Chapter 13)

* Short sale of previous home

* Foreclosure

* Modification of previous mortgage

* Sale of a home due to pre-foreclosure status

* Deed-in-lieu

Due to the recession of the past few years the government has given FHA the ability to relax their rules in order to help people qualify for home loans. Now people will only have to wait 12 months.

Meeting the New Qualifications

For borrowers that have faced a hardship like the ones described above they will need to meet a few qualifications.

First the borrower will need to prove that their current financial condition is recovered from the impact of the financial hardship.

Second, the borrower will need to provide proof that their income declined by a minimum of 20% for 6 months or longer. This can usually be shown by presenting federal tax returns and the supporting W-2 forms.

Finally the borrower will have to agree to complete a counseling session aimed at educating home buyers.

In addition to these items the borrower must re-establish their credit. This does not mean that the scores must be 700+. However, once the hardship has ended the borrower will need to have good payment history on all credit accounts in order to prove that they are able and willing to make their monthly obligations.

Types of Borrowers

The Back to Work program can be used for people buying their first home as well as people buying their second, third, fourth, etc. home. It can also be used with the FHA 203(k) program for people that wish to renovate or modernize a home. Even people that are currently in a Chapter 13 plan could be approved for the FHA back to work program. The court will have to grant permission for the loan and the borrower will have to meet the other requirements.

The recent recession has hit a lot of people and left a lasting impact on them. The Back to Work program is aimed to help these people put the past behind them and return to the stability of owning a home.

Additional Mortgage Information: Mortgage Home Loans Financing

Helping a home owner prevent foreclosure is a noble cause. Those realtors who wish to commit themselves to this cause are entering the path of Enlightened activities. However,  not everyone will be a success. It is more profitable to flip homes than work on a short sale for months only to see your efforts fail.

There are many challenges like negotiating liens, voluminous documentation, high wait time and an aggressive first mortgagee trying to foreclose the property. Such challenges do not exist on a normal real estate transaction. A reator entering this path will need to not only familiarize themselves with the technical aspects but also train their mind to develop certain special qualities.

This website does a good job of helping realtors with the technical aspects through a course and through the forum. When like minded people get together, they can encourage each other. However, I want to talk about training the mind to develop special qualities so we don't abandon our cause.

First,  we must try to remember that many people have helped us when we have been in distress and the high esteem in which we hold such individuals. Compare them with selfish individuals you have come across. You can then see clearly that you'd rather be the former than the latter. This is the first training.

Second, we develop the understanding that this could happen to anyone. Many people experience financial difficulties due to poor economy or not being able to work due to illness etc. Loss of job or reduction in income are the most common reasons due to which  people are unable to make  their mortgage repayments. This can happen to anyone. We must develop the understanding that this can easily happen to us.

Third, we develop a commitment to the cause. We must not look at a short sale transaction as just another transaction. We do not want to just go through the motions. Having realized that we want to help others and having understood that this could happen to us, we must seize the opportunity to rescue the home owners from their plight. This happens when we have committed ourselves to the cause. Every morning when you wake up tell yourself that today you will save homes from being foreclosed. You will save a family from the social and financial trauma brought about by a foreclosure.

Fourth, is awareness. Aware of the stress that such transactions can cause we can be better prepared. We have all experienced stress and if we did not like the experience chances are that somebody else will not like it either. By offering our presence to our clients we put them at ease by bringing them in contact  with our solidity.

Fifth, we must be vigilant. Many things can go wrong. By being vigilant we can prevent that from happening. Always keep an eye on the foreclosure clock. Check if you have standard documents like hardship letter, pay stubs etc. Some lenders frequently lose items or may deny having ever receiving them. Know where you are with each transaction at all times.

Sixth is developing the very valuable quality of patience. We have to tell ourselves that this will take time. You can negotiate a lien for 30% quicker than for 10% but that can kill the short sale. Be patient and help others do the same.

Seventh is perseverance. Perseverance is the ability to overcome difficulties that come our way. No agreement between the first and second lien holder. Unrealistic timelines set by the first mortgagee. Non responsiveness. These are commonly encountered challenges that we must overcome.

Eight is meditation. Take a glass of water. Add a few spoons of sand in it and stir it. That is the state of our mind. Now wait for the water to be still. The sand settles at the bottom and you can see clear water. This is a mind post meditation. By meditating we create conditions for wisdom to arise. We stop negative seeds like selfish desires, greed and frustration from germinating and we remind ourselves of these nine qualities and improve every day.

Finally, the ninth quality is wisdom. The understanding that we are all connected to each other and no one can do anything arbitrarily. While one idiot with poor knowledge can ruin it for others, this also means that we can make it a success. Make sure that you drive the transaction. Be clever. This realization will help you take almost every transaction to the desired conclusion.

Helping others is an activity of the Enlightened. Welcome to the path of Enlightened activities!

----------------------------------------------------------------

Saurabh Singh is a student of the Vietnamese monk Thich Nhat Hanh and is currently employed with Altisource. None of the views expressed in this post are endorsed by his employer.

Understanding a short sale approval letter is a critical skill for a real estate agent, homeowner selling on a short sale, investor buying on a short sale, and anyone affected by a particular short sale transaction.

Most banks approving short sales are national.  This means they have loans in most states.  However, they often have legal council for the states they have loans in.  Because of this, often they will adjust their short sale approvals based on what works on the state were the property collateral to the loan is located.

This subject can get real technical.  That would be outside the scope of this blog post.  Lets focus on what the person selling on a short sale (homeowner) really want as first choice.  That is to not owe after the short sale. 

Just to not miss any components, there are three important concepts to understand.  Here I am simplifying to the maximum.

• Short Payoff:  The bank gets paid less than the total present value of the loan balance and releases its interest on the property.  So the property is no longer collateral.
• Release of Lien:  A type of short payoff in which, the shortfall between what is owed to the bank and obtained from the sale, is still owed by the homeowner.   Basically the homeowner still owes to the bank
• Short Sale:  A type of short payoff in which the homeowner does not owe anything to the bank after the property is sold. 

Needless to say, all homeowners want a short sale.  The question now is to know what is that the short sale letter actually means behind all that legalese wording.

How to Distinguish a Short Sale Approval Letter:

A short sale approval will always clearly state that the loan will be satisfied in full for less than the amount owed or very similar wording.  See sample below.

How to Distinguish a Release of Lien:

A release of lien letter will always indicate that the lien will be released but the debt will not be satisfied in full.  In addition, most likely, the homeowner will have to sign a promissory note at closing.

Oscar Morante
Ph:  971-222-3734
Fax: 866-844-7009
PDX Experts Real Estate, LLC
www.PDXExperts.com
534 SW 3rd Avenue
Suite 305
Portland, OR 97204

Real Estate Agent
Realtor

By now, you should have heard that the real estate market is picking back up. Low interest rates and low inventory are spiking the average home price here in Washington State. Homeowners are now deciding on their options of either letting go of their underwater homes via short sale or foreclosure, continuing to live in it, or even rent it out and becoming a landlord. Which option would be best for you?

According to Corelogic, home prices nationwide increased on a year-over-year basis by 8.3 percent in December 2012 compared to December 2011. The spike is largely attributed to investors buying out most of the inventory thus increasing demand. This appreciation rate will most likely be unsustainable but of course, only time can tell. Zillow Home Value Forecasts (ZHVF), expects home values to increase 3.3% (Dec 2012 to Dec 2013).
Ah good news, home prices are rising again! So shouldn’t we keep our home that is underwater until we break even so we can avoid a short sale and a ding on our credit?
Let’s explore this option.

We will use the example of Mr. and Mrs. Smith who are barely making their payments and have a home that is worth $230,000 but owe $300,000 to their lender. The Smith’s think to themselves, if they live in their home in hopes to sell it once they come out from underwater, they don’t have to sell short. Assuming we will get a 5% appreciation rate (being optimistic), it will take them about 4 years just to break even. The Smith’s realize that it isn’t worth throwing away about $57,000 over the years in a home that has negative equity.

So they discuss their option of making their home into a rental property for the next 4 years to avoid the ding on their credit. Most likely, they will have a negative cashflow situation for all four years if you include PITI (principle, interest, tax, insurance) along with maintenance and repairs. Most importantly, the Smith's do not realize how difficult it is to be a landlord. Dealing with tenants (finding and maintaining), lease contracts, property maintenance/repairs, among others difficulties many times suck the life out of landlords. Many homeowners who opted to rent their homes because it was underwater are concluding to short sell years or even months later. Just ask friends or family about their experiences as landlords.

Mr. and Mrs. Smith’s situation is very typical and if they took the route of holding until breaking even, they will most likely be left with an even bigger headache.

What if Mr. and Mrs. Smith chose to short sell now?

A short sale is when you sell your home for less than what is currently owed on the property. The Smith’s decide to find a short sale expert and talk to their lender to see if they qualify for a short sale. IF they short sell now, they will finish in about 120 days which means if they started now, they will be done and out of their negative equity situation by summer time.

How would the financial rebound look like for the Smith’s? If they were not delinquent on their payments but was able to show inevitable delinquency, the ding on their credit score would be significantly less. If they were delinquent prior to closing the short sale, you will be facing about a 80-160 point ding in your FICO score.

Now how soon will they will be able to rebound on their credit depends on different factors. If the Smith’s end up using Lexington law to expedite rebuilding their credit score, they can easily repurchase another home within 2 years (possibly sooner) using the money that they saved from the mortgage payments that would’ve wound up in their underwater home. Once they are in a home, again, assuming that there is a 5% appreciation rate, they will start BUILDING equity.

So what is the best choice for Mr. and Mrs. Smith?

What do you think?

Peter

How to Buy Investment Properties with an IRA - Step by Step (Part 4 of 4)

Using a self-directed IRA to buy real estate is a sound investment strategy for many people. The ability to buy assets that can provide strong returns is appealing to a wide range of people. Listed below are the basic steps necessary to buy a property in compliance with the IRS rules governing the use of an IRA account.

1. Contact a financial firm that has experience with self-directed IRA’s. Working with a firm that is familiar with these accounts and the real estate transactions is the most important step.

2. Understand the IRS rules. A property bought via the IRA must be an investment home. Second homes, vacation homes and primary residences are strictly prohibited. Furthermore, distributions from the account are not allowed until the owner of the IRA is at least 59 ½

3. Deposit funds into the account. One of the important rules about buying property with an IRA is that all funds for the purchase as well as any other expenses has to come directly from the IRA. The owner cannot chip in extra money to help cover property tax or replacing the roof, in example.

4. All revenue received on the property must be deposited to the IRA account. The revenue cannot be given to the IRA owner or relatives.

5. Take time to preview multiple properties. It is wise to enlist the assistance of a real estate agent who has knowledge with these types of transactions. An agent can recommend properties in areas that have strong rental history. Furthermore, the agent can help calculate the return on investment based on average rent payments for the area.

6. Once you have picked out an investment property it is time to put down an offer. Contact the custodian for your IRA account and tell them you want to buy a property. The custodian will then fill out the necessary forms and sign all real estate documents on the behalf of your IRA account.

7. It is a wise idea to get a contract with a property manager to handle the finances of the property. This will prevent you from collecting the rent payments and making any necessary repairs yourself. A property manager can keep all the transactions clean and legal and free you from the headache of property management.

It is important to understand the rules concerning using an IRA to buy and manage real estate investments. Failing to follow the rules can lead to penalties and possibly loss of the tax advantages associated with an IRA account. When in doubt consult a tax professional before making any decision or transaction with the IRA funds.

This is Part 4 of a 4 Part Series.

Part 1: How a Realtor® can help you invest in your IRA

Part 2: Purchasing Investment Properties for your IRA

Part 3: How to invest in real estate using an IRA

Part 4: Step by Step Guide to Buying Homes with your IRA

In my previous blog post, I estimated that in 2014, home prices were expected to rebound. 2012 however surprised all of us with sharp price increases. What is causing this price increase? A number of factors may play into it but one of the main variables is the lack of supply thus increasing demand and prices. It is a seller's market and will probably remain until the latter half of this year. However, I don't believe this will last.

Based off our research, there is a artificial lack of inventory meaning, home prices may very well halt its increase and decline for some time. Let's explore why short selling now would be in your best interest.

What will the status of the housing market be in the next couple of years? Only time can tell. What we can investigate are the factors that led to the volatile home prices.

We are seeing large hedgefund investors like blackstone and other cash investors, buy out most of the inventory. Concurrently, new legislation as seen in California, Oregon, Nevada, and Washington, are slowing down the foreclosure flow in those areas which according to Daren Blomquist, VP of RealtyTrac, will result in a backlash of foreclosure activity at the end of this year and into 2014. RealtyTrac is still expecting to see about 600,000 REO's enter the market in 2013. This indicates a hit on home prices to come.

At the same time, homeowners are vulnerable to a large tax liability at the end of this year. The mortgage forgiveness debt relief act is set to expire Dec. 31, 2013. For more information, please read our previous blog post.

A short sale is when you sell your home for less than what is owed. The remaining balance owed is negotiated so if home prices decrease, the difference between the sale price and the amount owed will only grow meaning you have a higher risk of owing more to your lender after you short sell your home.

Moral of the story, no one can fully time the housing market but the uncertainty should create urgency this 2013 year.

Hope this helps

Peter

 www.seattleshortsaleblog.com

How to Purchase a Home in 2013

As this new year begins many people are setting goals, making resolutions and generally planning for a better year. If you are one of the people considering a home purchase in the upcoming year there is some sound advice to follow in order to make the process smoother and ensure that you get in to a home that truly makes you happy.

Be Realistic About Your Finances

If you are currently renting a nice place for $650 a month then it would seem unreasonable to think that you could afford a home with a loan payment of $1,000. WHY, you may ask? Because the expense of owning a home goes well beyond the monthly payment. There are other things like mowing the lawn, keeping the furnace and air conditioner maintained, repainting every few years, updating the bathroom, replacing an appliance or two, and the list goes on. Understanding the expense for these items will help you set your budget accordingly and hopefully prevent you from getting in to a home that you cannot afford.

Talk to an Experienced Mortgage Broker

After determining how much you can comfortably afford for a home, it is time to chat with a mortgage broker. The broker can look over your finances, your credit history, employment history and the length of time you have lived at your current address and determine the best loan for your needs. A broker can also get offer from multiple lenders in order to get the best rate for your mortgage.

It is wise to let the broker know how much you are comfortable paying each month so that they can use this information to establish a price range for your home. Most people can financially afford more than they are willing to pay. Having the right budget amount will help when you begin looking at homes.

Talk to an Experienced Real Estate Agent

Now that you are firm in the amount you can afford monthly for a payment and you have an approval from a mortgage lender it is time to talk to an experienced real estate agent. A good agent will sit down with you and listen to your wishes in order to decide which homes could meet your needs. Using the price range provided by the mortgage lender, the agent can focus on homes that fall in your budget and prevent wasting time on homes that are too expensive. An agent can also focus on other parameters such as a specific school zone, homes with particular features, size of the home and other things that are important to you.

Don’t put it off any longer. Sit down with a calculator and decide how much you can afford. Then make the decision to make 2013 the year that you become a homeowner!

Related posts:

1. Getting Pre-Approved for a Mortgage Before Looking for a WI Home 
   
   
2. Using FHA 203K Loan to Purchase a Fixer-Upper
   
   
3. 4 Tips to Determine How Much Mortgage You Can Afford
   
   
4. Keep Your Home Purchase on Track
   
   
5. Tips on Buying Your First Wisconsin Home

The Consumer Financial Protection Bureau is finalizing the “Ability-to-Repay” rule which requires lenders to obtain and verify information to determine whether a consumer can afford to repay the mortgage. Our belief is the 2013 ATR final rule will dramatically alter the residential mortgage market making it more difficult to obtain another mortgage.

"It should be emphasized that a mortgage loan that is not a "qualified mortgage" and that does not meet the ability-to-repay requirement would subject the creditor and subsequent assignees to, among other things, civil liability under TILA and provide the borrower with a defense to foreclosure. In addition to actual damages, statutory damages in an individual or class action, and court costs and attorneys fees, the Dodd-Frank Act also amended TILA to include special statutory damages for a violation of the ability-to-repay requirement equal to the sum of all finance charges and fees paid by the consumer, unless the failure to comply was not material.^2"

Based off this information, we can infer that lending practices will be tighter and obtaining another mortgage will be more difficult for most to-be homeowners. If creditors now have penalties in the event that they do not fully qualify the borrower, then we can reasonably assume they will shift their lending to only those who they deem are “low risk.”

"A creditor shall not make a loan that is a covered transaction unless the creditor makes a reasonable and good faith determination at or before consummation that the consumer will have a reasonable ability to repay the loan according to its terms."⁴

To be clear, we are not criticizing or opposing this new rule as we don’t want to see another subprime mortgage crisis on our hands. However, current homeowners need to understand that their actions with their current home will determine their ability to obtain another mortgage in the future.

Rather than going through the whole foreclosure vs short sale debate, we’ll make this simple. Put yourself in the underwriters shoes and the new ATR rule now passed. You have two applicants with one credit report showing a Foreclosure and another showing “Paid for less than original amount.” According to Experian, most lenders typically report a short sale as a “settled” account.

Who do you think will obtain the loan and get to live in their new house?

Feel free to comment on what you think about the new Ability to repay rule. Thanks!

Peter

Real estate is not always an easy venture to be involved in. Mortgages are huge loans, and monthly payments can be extremely steep. Especially with the trend a few years back to give out sub-prime mortgages, there have been a lot of foreclosures lately. But foreclosure should be avoided at all costs.

So let's assume for a moment that you are unable to make your mortgage payments. You become a defaulted owner. Now what? Well, typically, your lending institution will foreclose its mortgage. If this happens, not only will you lose your property when it goes back to the bank, you will lose all your equity. In addition, foreclosure reduces your credit rating, leaving a permanent stain on your credit account. This can be extremely hard to remove, and may prevent you from ever borrowing again. Finally, you may even have to pay taxes on the debt reduction amount. So in trying to save money, you've only added another expense to your list of bills. All in all, foreclosure is a bad deal for you.

There are two main types of foreclosure, foreclosure by judicial sale and foreclosure by power of sale. In the former, the court supervises the sale of the property. In the latter, the bank or mortgage holder sells the home. In a strict foreclosure, not in use in all states, the bank would assume the deed of the defaulted mortgage, without the obligation to sell. This method is less popular as few banks want to become landlords. Usually, by whatever means, the foreclosure involves the sale of the property.

If you are unable to make your mortgage payments, or in any other way are unable to fulfill the obligations of your lending contract, it is best if you sell your real estate as soon as possible. This may mean selling at a much lower rate than market value, however as a homeowner, you may be able to retain some equity from your home, and you will definitely save your credit rating. This is very important for your future real estate purchases, and just about anything else in your life. By selling your home yourself, with or without the help of an agent, you are keeping the power in your hands. Even if you come out of it with no equity, the chances of losing money is slim unless your home has become totally derelict. Even then, you are still better off selling it yourself than allowing a foreclosure to go ahead.

While in a stressful situation such as mounting debt, it can seem like the easy thing to drop everything and run. But as I've outlined, it is never to your advantage to let a property foreclose. The key to saving yourself from this fate may be an honest analysis of your expenses. If you can see a problem coming, you have more time to act on it. Rather than waiting to the last minute, put your home up for sale as soon as you suspect you will have trouble making payments in the future. The more time you have to sell, the more likely you'll walk away with a fair price for your property. You may even be able to find another, cheaper home, and nobody will have been the wiser that you narrowly escaped financial disaster.

Antonio Atoche
310-345-1513
antonio@atocherealestate.com
www.upsidedownlosangeles.com
For more information visit https://www.google.com/

How to sell your home | Gardena | Antonio Atoche

For most people, the prospect of selling their home can be positively daunting. First of all, there are usually plenty of things to do just to get it ready for the market. Besides the traditional clean-up, paint-up, fix-up chores that invariably wind up costing more than you planned, there are always the overriding concerns about how much the market will bear and how much you will eventually wind up selling it for.

Will you get your asking price, or will you have to drop your price to make the deal? After all, your home is a major investment, no doubt a rather large one, so when it comes to selling it you want to get your highest possible return. Yet in spite of everyone's desire to get the top dollar for their property, most people are extremely unsure as to how to go about getting it. However, some savvy sellers have long known a little financial technique that has helped them to get top dollar for their property. In fact, on some rare occasions, they have even sold their properties for more than they were worth using this powerful financing tool. Although that might be the exception rather than the rule, you can certainly use this technique to get the most money possible when selling your property.

Seller carry-back, or take-back financing, has proven to be a surefire technique for closing deals. Even though most people do not think about when it comes to selling a property, they really should consider using it. According to the Federal Reserve, there are currently over 100 Billion dollars of seller carry-back (seller take-back) loans in existence. By any standard, that is a lot of money. But most importantly, it is also a very clear indication that more people are starting to use seller take-back financing techniques because it offers many financial benefits to both sellers and buyers. Basically, seller take-back financing is a relatively simple concept. A seller-take back loan is created when a property is sold and the seller performs like a lender by assisting in financing all or part of the total transaction. In effect, the seller is actually lending the buyer a certain amount of money toward the purchase price, while a traditional mortgage company usually funds the balance of the purchase price. A seller take-back loan is secured with the property. The loan then becomes the primary mortgage and is fully secured by the property. In most seller take-back financing transactions, the buyer repays the seller with interest in accordance to mutually agreed terms over a period of time. Usually, the terms call for the buyer to send the payments, consisting of principal and interest, on a monthly basis. This is advantageous because it creates a steady monthly cash flow for the note holder. And if the note holder decides to cash out, he or she can always sell the note for a lump sum cash payment.

Regardless of market conditions, seller take-back financing makes sound financial sense; whereas, it provides both buyer and seller with flexible financing options, makes the property easier to sell at higher price and shortens the sales cycle. It also has the added advantage of being an excellent investment that generates a steady cash flow and high return. If you ever need immediate cash, you can always sell the note through our office. If you are planning to sell a property, then consider the many benefits of seller take-back financing.

Antonio Atoche

310-345-1513

antonio@atocheralestate.com

www.upsidedownlosangeles.com

For more information visit https://www.google.com/

[caption id="attachment_30" align="alignnone" width="150"]How to sell your home | Gardena | Antonio Atoche[/caption]

How to sell your home | Gardena | Antonio Atoche

How to sell your home | Gardena | Antonio Atoche

How to sell your home | Gardena | Antonio Atoche

How to sell your home | Gardena | Antonio Atoche

How to sell your home | Gardena | Antonio Atoche

How to sell your home | Gardena | Antonio Atoche

7 Reasons to Avoid a Foreclosure

Families who typically end up foreclosing on their home often didn’t understand the foreclosure process or simply just gave up because they no longer cared or could handle the stress. The foreclosure process is typically an emotional rollercoaster and it’s not uncommon for us to hear they simply wanted to “wash their hands of the headache”. In situations like this, we urge homeowners to become aware of their options and really understand what a foreclosure means.

We’re prepared a quick list of foreclosure consequences that will help you understand exactly what a foreclosure means.

1)      If your property forecloses, you will be required to disclose this on all future mortgage applications, and on many job applications. This can have an adverse effect on your future mortgage rates.

2)      According to Fair Isaac Corporation, credit scores will be lowered by 300 or more points. A foreclosure is considered the most devastating credit issue in relation to future credit availability and if coupled with bankruptcy can be very hard to recover from.

3)      A foreclosure is very difficult if not impossible to have “repaired” on your credit report.

4)      It could open up the possibility for your mortgage lender to seek a deficiency judgment and attempt to collect the difference not accounted for from the sale of the home.

5)      A foreclosure can put a new job in jeopardy, as many employers are now running credit checks on potential hires.

6)      A current job could be in jeopardy. There are many employers who run credit checks annually to make sure employees are not underwater in their finances.

7)      Government jobs can be jeopardized with a foreclosure showing on a credit report, especially those with security clearances.

With these points in mind, if you find yourself underwater and unable to make a mortgage payment, it’s important to seek out options. One option that will allow you to still exit the home is called a short sale.  A short sale is often the better route and provides a more favorable outcome for both you and your mortgage company. The ability to find experienced short sale team with a proven successful track record will help you protect yourself from a diminished credit score and the possibility of losing employment opportunities.

We are here to help – call us today – 888-746-7820. 

www.shortsaleapprovals.com

The Mortgage Debt Relief Act of 2007 is set to expire!!

The window is closing rapidly on one of the most important tax-relief provisions enacted by Congress during the housing crisis to help financially strapped homeowners. Time is running out to Short Sale your house. Although the 2007 law that allows taxpayers to exclude from income the amount of debt that is forgiven or canceled by their lenders doesn’t expire until Dec. 31, it’s likely to take every bit of the coming months to persuade your bank to either foreclose or allow you to sell your house for less than it’s worth (Short Sale).

While owners who are struggling to hold onto their homes shouldn’t throw in the towel solely because of the pending tax bite, it is certainly something to consider.

Under the tax code, borrowed money need not be reported as income because you have an obligation to repay. But if the lender subsequently cancels what you owe, the IRS requires that you report that debt as income because the duty to repay it no longer exists. So, if you owe $250,000 and your lender forgives $50,000 of that debt in a $200,000 refinancing, that $50,000 is considered income. If your combined federal and state marginal tax rate is 36 percent, you would owe $18,000 in taxes.

Under the Mortgage Forgiveness Debt Relief Act of 2007, though, taxpayers are allowed to exclude from income the discharge of debt on their principal residence when they do a short sale— at least until 2013.

So when your lender agrees to a short sale, there is no tax on the difference between the selling price and the amount you owe. When your lender forecloses, there is no tax on the canceled debt. Even when you refinance at a lower loan balance, there is no tax on the difference between what you owed on the old loan and what you now owe on the new one.

But unless Congress extends the law — and there is no indication lawmakers are even thinking about that — all residential mortgage debt relief that takes place on or after Jan. 1, 2013, will once again be considered taxable income.

Why worry about this now, Because the timelines on debt forgiveness decisions by lenders are absolutely horrendous.

Of course, each state has a different timeline. But the shortest is 463 days in Minnesota, according to Lender Processing Services. So the tax absolution window may already be closed for foreclosures.

There are no hard-and-fast numbers when it comes to short sales or loan modifications. But they also can be long, drawn-out transactions.

According to a nearly year-old survey by Equi-Trax Asset Solutions, a Santa Barbara, Calif., analytics company, it can take anywhere from four to nine months for underwater borrowers to persuade their lenders to sign off on a deal in which the lender will net less than what the borrower owes (Short Sale).

Eighteen percent of the 600 agents polled said short sales can be closed in less than three months if the stars line up just right. But almost 10 percent said these transactions require more than 10 months to complete.

There are many factors besides a tax break to consider when deciding whether to give up your house. What will a foreclosure or short sale do to your credit score? How long will you be precluded from buying another house? Will the extra income push you into a higher tax bracket? How long will it take before the amount I owe is on par with what is owed? Is it worth being tied down to one property for many years or should I just short sale and be back in the market within 2 years and probably buy more house for way less.

Consequently, as always when it comes to such matters, you should consult a tax professional before making any decisions.

At Trinity Homes & Investments we discuss all available options with our clients before deciding which course of action to take.  Our mission is to find dignified solutions to foreclosure.

The National Association of Realtors and the U.S. Department of the Treasury are collaborating to help Realtors better assist distressed homeowners who are struggling to Selling Your Home Through a Short Sale - Avoid Foreclosure.

Realtors who attend upcoming Making Home Affordable "Help for Homeowners" outreach events, sponsored by the Treasury Department, will learn insights to help them navigate the short sale process and have the opportunity to meet directly with loan servicers on their clients’ behalf for assistance with difficult transactions, according to a statement.

"As the nation’s leading advocate for homeownership and housing issues, Realtors are working hard to keep more people in their homes, and when a family is absolutely unable to keep their home, Realtors specializing in short sales, short sale specialists are there to help homeowners by facilitating a loan modification or short sale," said NAR President Moe Veissi, broker-owner of Veissi & Assoc. inc. in Miami.

"Help for Homeowners" community events will take place throughout the year; the first sessions are in Miami today and Tampa, Fla. on Feb. 24. Additional events are scheduled in Chicago, Indianapolis, Los Angeles, and Sacramento, Calif.

The sessions for real estate professionals are not open to homeowners, but borrowers who are in financial distress and concerned about losing their home to foreclosure are encouraged to attend the free homeowner sessions. Homeowners who are having difficulty paying their mortgage will be able to meet one-on-one with loan servicers and housing counselors to explore foreclosure prevention options and work toward solutions to their mortgage problems. Real estate professionals are encouraged to invite homeowners and their clients to the events and are welcome to accompany their clients in conversations with the servicers.

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in;  Bexley  Columbus  Delaware  Downtown  Dublin  Gahanna  Grandview Heights  Granville  Grove City  Groveport  Hilliard  Lewis Center  New Albany  Pickerington  Polaris  Powell   Upper Arlington  Westerville  Worthington

Bank of America is making a process change that will reduce the processing time and improve customer service for HAFA Short Sales (Home Affordable Foreclosure Alternative Program) that are submitted with an offer.

The proposed change goes into effect Dec. 1, 2011, and impacts all short sales submitted with an offer in which the homeowner is eligible for the Home Affordable Foreclosure Alternative (HAFA) program.

When a short sale is submitted with an offer and the homeowner is HAFA eligible, we will no longer halt work on the file while waiting to contact the homeowner. HAFA eligible homeowners are no longer required to call our Short Sale Customer Care to indicate whether they will participate in the program.

Instead, real estate agents specializing in short sales can indicate a homeowner's HAFA interest by submitting the necessary documents to Equator within 14 days. During that 14-day window, the short sale will continue moving forward. By the end of the 14 days, if we have not received the requested HAFA documents, we will continue to process the file as a traditional short sale.

This change is being made because we are transitioning the processing of all HAFA short sales with an offer from our outsourced vendor partners to Bank of America associates. A Bank of America specialist will be able to seamlessly transition a file from our traditional process to the HAFA process, thus improving customer service and the borrower and agent experiences. Homeowner's and agents should be aware that Bank of America's outsourced vendor partners will, however, continue to process all short sales submitted without an offer.

Action required:  

Short sales initiated on Equator.com that receive a HAFA eligibility message no longer require homeowners to call Customer Care to confirm their interest.

-  If homeowners wish to participate in HAFA, agents must submit the requested documents within 14 days.  (Note: the 14-day period begins the day the HAFA solicitation letter is mailed to the homeowner. Agents can obtain the date of the letter from homeowner.) 

-  If you are unclear about which documents to submit, contact your short sale specialist via Equator messaging. 

Additional Recommendations:

Homeowners interested in understanding the benefits a HAFA short sale, including the $3,000 relocation incentive at closing are encouraged to review HAFA Program or the HAFA education guide to learn more.

Bank of America also has put together a HAFA Eligibility FAQ for interested homeowners