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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

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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.

What is the Purpose of an Appraisal?

A mortgage has many specific pieces involved in it. Obviously there is the money supplied by the lender to pay the seller for their asking price. There are also many other items such as the title report and title insurance, a survey (sometimes), proof of homeowner insurance policy and an appraisal. An appraisal is actually one of the more important pieces and yet it still brings questions from buyers and sellers alike.

Required by the Lender

First and foremost, if a home is being purchased through the use of a mortgage then the lender will require a formal appraisal. A licensed appraiser works independently of the real estate agent and the lender to ensure that there is no undue influence on the process. The appraiser’s report will indicate if the home is worth the asking price.

Appraisal ordered after a Selling Price has been negotiated

The appraiser is contacted after the real estate agent(s) and all associated parties have worked out a price for the home. The appraiser will look at the contract along with a host of other items such as

* Square footage of the home

* Local property taxes for the home

* When the home was built

* General shape and condition of the property

* Average sales price of similar homes in the area

The price for the appraisal depends on the area of the country. Sometimes the appraisal fee is paid by the borrower up front and other times it may be paid as part of the closing costs.

Wise to Inspect First and Appraise Second

In an ideal world the buyer of a home would hire a home inspector to review a property before the home is appraised. The job of an inspector is to seek out any potential problems with the property. This can be as simple as finding a loose door knob to as complicated as finding out the entire heating and ventilation system needs replacing. Once the inspector has looked at the home the appraiser can approach the property with some idea of any possible short comings of the home and assign the correct value to the home. In a worst case scenario an inspection could lead a buyer to cancel a contract and look for a different home.

The Journey of the Appraisal

Once the appraiser has finished the report a copy will be sent to the mortgage lender and possibly the real estate agents. If the buyer paid for the appraisal up front then they too will get a copy when it is complete. Otherwise, the buyer will receive a copy at closing.

The lender, whether it is a bank or local mortgage company, will have their own process to review the appraisal and ensure the numbers look accurate. If the value of the home is much lower than expected then the lender may cancel the loan. On the flip side, if the home is determined to be worth more than the asking price then the buyer will have instant equity.

     If you are a Realtor or short sale negotiator who has done a short sale with Fannie Mae as the investor during the last few months, this blog post will likely raise a question or two.  For everyone else, it will definitely also raise an eyebrow or two. Government conspiracy theorists are certainly not a rarity in this day and age. Depending on who you speak to, many of our fellow citizens can come off as paranoid and irrational when speaking about all the secret plans they seem so sure our government and those in power are plotting and planning. While the theory I'm proposing on here is certainly not up to par with the New World Order, Illuminati, One World Government folks, it is certainly some concerning and valid food for thought, especially for those of us in the Real Estate and Mortgage industry.  Take a few minutes to read this blog post, and you'll likely agree and come to find that this really isn't about a conspiracy theory, but a very real and disturbing trend that is happening in our housing market right now.

     Lets take a step back here and set the stage.  Over the last five to six years, we have seen real estate prices plummet in virtually every market across the country. This reality of the depressed housing market is certainly no secret. In many areas, prices have declined to as low as thirty cents on the dollar. Several years ago, As things became more and more depressed, our government stepped in.  Both Fannie Mae and Freddie Mac, who back the majority of our residential mortgage loans, were completely bailed out by the US government.  This forced overtaking was something that our government had to do, as the imminent collapse of Fannie and Freddie would have meant the complete collapse of the housing and finance industry, likely permanently.  This was extremely important, as instead of giving bailout loans to Fannie Mae and Freddie Mac, like the auto industry or the banks, they actually took complete control of these organizations.  Our government then established the Federal Housing Finance Agency (FHFA) to "oversee" these organizations which are now referred to as Government Sponsored Enterprises, or GSE's.  Since then, the FHFA consistently dictates policy to these Government Sponsored Enterprises that still back most residential mortgage loans and completely control the secondary mortgage market.

     Now back to the present.  Fantasic news headlines in much of the country that in many of the markets that were hardest hit, prices now seem to get going up almost as quickly as they were once declining. Inventories are low, demand is high, properties are getting multiple offers from buyers paying over list prices the minute they come on the market.  But for those in the industry such as myself who are active in the short sale and distressed property niche, an interesting and disturbing practice that has been taking place.

     In very recent times, just in the past few months, short sale agents across the country have been having difficulties with Fannie Mae short sales.  To be more specific, the difficulty has been with wildly inflated appraised property values that Fannie Mae has been insisting on for short sale properties. For those who may not know, we are not talking about regular appraisals, traditionally ordered by a buyers lender in order to justify a purchase price.  In this case, we are talking about appraised values that Fannie Mae places on properties, ordered by them and completed by their own appraisers, utilizing their own appraising and property valuation methods.  Utilizing these over inflated appraised values, Fannie Mae then demands more money for these short sale properties from patient buyers.  Anyone starting to smell the stink yet? Does this stink smell a little similar to the stink we all experienced several years ago with inflated buyer appraisals from before the housing market collapse?

     For the most active short sale agents across the country, the past few months have produced quiet a few headaches with Fannie Mae.  It seems virtually every property valuation and appraisal done by Fannie Mae for a short sale is at least 10% or more above current market value.  Values so inflated, that there are typically no comparable sales at all to come remotely close to justifying their prices.  Prices so high, that it most cases it would be virtually impossible for a buyer to find a loan and get an appraisal that would match the property values and prices that Fannie Mae is demanding.  The ironic part, is that these same buyers' loans who are purchasing these properties would of course eventually be sold off to... You guessed it, Fannie Mae! Because of the massive number of loans backed by Fannie Mae, this is widespread and is effecting a very high percentage of current sales.  And when it comes to disputing these inflated values, it can be quiet a challenge for real estate agents and short sale processors to convince Fannie Mae to change their mind and sell the properties for actual market value.

     Put two and two together, read between the lines, and it makes perfect sense that this is just Fannie Mae's and our policy dictating governments' valiant and likely effective attempt at mass, government controlled real estate price fixing.  Control the supply (market inventory), control the demand (interest rates ect), and then control prices and force up property values by demanding more money.  Fannie Mae and Government controlled real estate price fixing.  The tail wags the dog, and the dog has no clue what is going on.  A perfect example of the reality that housing has become completely socialized, but with the illusion that its just all part of the market cycle.  Just my two cents, for what its worth.
Click Here for my original article on Government Real Estate Price Fixing

The Wisconsin housing statistics are now in for April of 2012. Here is an excerpt from what the Wisconsin Realtors Association (WRA) had to say:


“The strong pace of existing home sales continued, with 10 straight months of double-digit sales growth. Home sales rose 19.5 percent in April 2012 compared to April 2011, according to the most recent monthly report by the Wisconsin REALTORS^® Association (WRA). Home prices were also up for the second straight month, rising 2.4 percent to $128,000 in April compared to April 2011."


“After several years of a stagnate housing market, it’s encouraging to see sustained growth in home sales, especially as we enter the summer, which is the prime season for home sales in the state,” said Rob Keefe, Chairman of the WRA board of directors.


The WRA says an improving state jobs market is helping home sales. Since December, the state has added nearly 18,000 nonfarm private jobs even as government employment fell by 3,400 based on seasonally adjusted estimates.


Below are the number of Home Sales and Median House Prices for the state of Wisconsin, Rock County, and Dane County. These stats include Janesville and Madison. Feel free to contact me if you have any questions pertaining to these figures. As you can see, home sales have been increasing substantially this year. The median sale price in Dane County has risen approximately $8,500 year over year. In Rock County Wisconsin, the median sale price has fallen, $2,450, year over year.


If you would like some insight into how much your home is currently worth, I would be happy to provide you with a free comparative market analysis. This is a report that gives a close estimate to what your home might sell for in your current local Wisconsin real estate market. Has your home value fallen below what you currently owe? A short sale may be right for your situation. Visit the following page on Wisconsin Short Sales.


The Wisconsin housing statistics are now in for May of 2012. Here is an excerpt from what the Wisconsin Realtors Association (WRA) had to say:

“Wisconsin home sales recorded strong growth again in May, continuing the trend that began last summer. Sales of existing homes were up 18.9 percent in May 2012 compared to May 2011. In addition, median home prices in the state rose 1.5 percent to $138,000 relative to the same month last year"

“It’s good to see Wisconsin’s housing market continuing a robust rebound from the depressed levels of the recession,” said Rob Keefe, Chairman of the WRA board of directors. He noted that the monthly growth rates have been in the double digits since July 2011, and that year-to-date home sales are up over 20 percent in the state. The South-Central region was up 18.5 percent.

Below are the number of Home Sales and Median House Prices for the state of Wisconsin, Rock County, and Dane County. These stats include Janesville and Madison. Feel free to contact me if you have any questions pertaining to these figures. As you can see, home sales have been increasing substantially this year. Both Dane and Rock counties are showing marked improvements in the number of homes sold.

If you would like some insight into how much your home is currently worth, I would be happy to provide you with a free comparative market analysis. This is a report that gives a close estimate to what your home might sell for in your current local Wisconsin real estate market. Has your home value fallen below what you currently owe? A short sale may be right for your situation. Visit the following page on Wisconsin Short Sales.

The Wisconsin housing statistics are now in for June of 2012. Here is an excerpt from what the Wisconsin Realtors Association (WRA) had to say:

“Wisconsin home sales continued to grow at a robust pace with sales of existing homes up 19.3 percent in June over June of last year... June median home prices increased 1.4 percent to $142,000 relative to the same month last year which is the fourth straight month of increasing median prices."

“In a national economy that has not yet seen the kind of growth rates that typify most economic recoveries, it’s encouraging to see such strong growth in home sales over the last 12 months,” said Rob Keefe, Chairman of the WRA Board of Directors.

Below are the number of Home Sales and Median House Prices for the state of Wisconsin, Rock County, and Dane County. These stats include Janesville and Madison. Feel free to contact me if you have any questions pertaining to these figures. As you probably have heard, home sales have been increasing substantially all year. Both Dane and Rock counties are showing marked improvements in the number of homes sold.

If you would like some insight into how much your home is currently worth, I would be happy to provide you with a free comparative market analysis. This is a report that gives a close estimate to what your home might sell for in your current local Wisconsin real estate market. Has your home value fallen below what you currently owe? A short sale may be right for your situation. Visit the following page on Wisconsin Short Sales.

FOR IMMEDIATE RELEASE:

Michael Collins Earns NAR Broker Price Opinion Resource Certification

Sellers and Lenders Benefit from REALTOR^® Expertise in Broker Price Opinions

Madison, WI — Michael Collins with Rock Realty has earned the nationally recognized Broker Price Opinion Resource certification. The National Association of REALTORS^® offers the BPOR certification to REALTORS^® as evaluating properties depends more than ever on professional expertise and competence, the best use of technology, and a commitment to approach the valuation assignment from all pertinent perspectives.

“As the real estate market evolves we are seeing more demand for broker price opinions, and it’s imperative that REALTORS^® are knowledgeable and educated about how BPOs work, as well as the risks involved,” said NAR President Moe Veissi, broker-owner of Veissi & Associates Inc., in Miami. “The BPO Resource certification not only adds value to the services provided by REALTORS^®, but also it helps practitioners grow their business.”

“BPOs: The Agent’s Role in the Valuation Process” is the required one-day course that provides REALTORS^® with knowledge and skills to reduce risk and increase opportunities to create professional and accurate BPOs. In addition to completing the course, participants are required to take a Webinar. Once awarded the certification, REALTORS^® will be eligible to receive BPO orders as a preferred provider.

In addition to providing members with the opportunity for BPO business, BPO Resource will explore the multiple uses of BPOs, how they can and cannot be used, and how to filter and select comparables to create expert and precise BPOs. The certification also assists member in creating more comprehensive comparative market analyses for their customers’ listings.  For more information about the BPOR certification, visit www.BPOR.org.

# # #

Tips for Buying Your First Short Sale

A short sale is a fairly simple procedure, at least in theory. A homeowner sells their home for a price below the current mortgage balance. The bank agrees to take this lesser amount as payment in full of the mortgage in order to avoid the heavy cost of a foreclosure. Here are some tips for buying your first short sale.

Short Sale prices are determined by the Market

Banks determine which offers to accept by reviewing the current market conditions. They will look at the prices of homes that have recently sold in the nearby area. This information will provide the lender with solid data for the average price of a home in that vicinity. How low will they go? This depends on how quickly they would like to sell the home. If they determine that they would prefer to sell the home now, and not proceed to foreclosure, they may agree to sell the home at below market value.

Ask your Realtor® for their Price Opinion

Before you submit a low-ball offer to the seller, ask your Realtor® for their price opinion. This is a good way for a prospective buyer to find an appropriate price range for an offer. Your agent can look at recently sold comparable homes and give an opinion on what they feel the home should sell for. This is similar to a Comparative Market Analysis, or CMA.

Multiple Mortgages Can Cause Problems

When a home has a 1st mortgage and 2nd mortgage that are held by separate lenders then a short sale could take a very long time, if it gets approved at all. Unfortunately, this type of scenario is out of the hands of the real estate agent and the seller. Whether or not the two lenders agree to the short sale offer is totally up to them.

Approved Prices are Usually Processed Faster

If a lender has already determined a price that they will accept, this can speed up the process. Usually, this is an indication that the seller has been in contact with the bank to discuss the possibility of selling the home. If an offer within that price range is submitted to the bank, the short sale is far more likely to be approved quickly.

Prepare for the Bank to say No

While short sales can help buyers get a home at a discounted price, the process can stretch out over time. The sale can get turned down by the bank for a number of reasons. This is why people looking to buy a short sale should be prepared to move on to a different property in the event that the bank denies the short sale. Keep an eye open at available homes during the short sale process. If the bank does say no, you will then have a list of potential houses that may also be an option.

While a short sale transaction may span a few months, it is a good way to buy a home at a friendly price. Talking to an experienced Realtor® about the available short sales in your area could put you in line to get a good home at a great price.

Buying a Short Sale - Original Post

Short Sale pricing is a key..  to a successful closing.  Setting a correct price is a skill that comes with experience.  There is more involved than simply running comps.  With a Short Sale, the Lender(s) involved and the months delinquent on the Seller's part have to be figured in.  The condition of the house, HOA delinquency, repairs required, examination of comps for Short Sale % pricing.  Do I need to establish a Property History?  Is there time?  Who has any extra money here? 

Once the price is set, a Listing Agent cannot simply let it rot.  If that price is too low..too many offers and the Lender will not go for it.  If the price is too high...why?? 

A Short Sale Listing Agent must have Sellers that co-operate and understand the plan of attack when the Listing is accepted.  Everyone agrees where they are in the process. 

When a Buyer's Agent calls and asks for explanation re: pricing, give it to them.  Be detailed.  There should be a method to the Short Sale pricing the List Agent has in place.  There are MANY scenarios for Short Sales..as many as there are types of loans and Lenders. 

Take your time at the start, establish the correct price for your particular Short Sale Sellers and stick with the program.  Get that local BPO and work it wisely...