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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.

Ignoring Potentially 21%

In April, 2014, RealtyTrac came out with a report that showed that 1) 9.1 million, or 17% of all US mortgages (total number of US mortgages calculated at over 53.5 million) were STILL seriously underwater, where the loan amount is higher than the property value. Housing values in many areas are coming back, but not enough to put many of the 9.1 million still underwater homeowners into a positive equity position.

In March of 2013, 2) RealtyTrac reported there were 2.2 million past short sellers trying to re-enter the housing market again.

Past short sellers and still underwater homeowners who may have to short sell in the future equate to potentially 21% of the total US residential mortgage market numbers.

The credit of a great majority of those that "have had to or may have to short sell" is proven to be good, with most professing and pr...oving that keeping credit intact is given the highest priority. However, most underwater homeowners have dangerously high back end debt to income ratios as they borrow against everything they've got to stay put, until they cannot any longer. Many are depleting retirement funds and borrowing from other assets to stay solvent.

And the "strategic default" label placed en-masse upon short sellers from 2007-2009 has been proven to be 3) "relatively rare" suggesting that the greatest indicator of default has been unemployment, and that policies designed to promote employment, such as payroll tax cuts, are most likely to stem defaults rather than policies that temporarily modify mortgages.

Short sales are not approved unless a hardship exists, and the majority of those affected will not tell realtors or even their lender of hardship endured unless seriously prodded or required to do so.

Short sellers are saddled with an even bigger problem once they are able to exit their home. There is a credit code problem where past short sale credit shows up as a foreclosure. The foreclosure code is borrowed from the Metro 2 system and the code conflicts in the same raw data, where a narrative of "settled for less than full balance" appears with foreclosure credit code. This credit change occurs when a mortgage holder applies for a short sale and when their mortgage credit goes past 4)120 days delinquent.

On Nov. 16, 2013, the Fannie Mae DU version 9.1 became available and was supposed to allow lenders who were receiving a Refer/Caution( denial) on 5) conventional mortgages because the past short sale was showing as a foreclosure, to go into the Fannie Mae system and make a change. Instead, lenders must be given the OK to make the change first by Fannie Mae in verbiage provided in findings. This only works occasionally, and when the lender receives the OK to go in and make the change, the lender must state "YES" to a foreclosure to finalize.

Further, the problem also exists in Freddie Mac, which was unknown prior because Freddie Mac does not give an automated approval on past short sales until four years past the short sale. We now have cases of Freddie Mac denials of short sales, past the four years, miscoded as a foreclosure.

When we start paying attention to the erroneous foreclosure code that is stopping past short sellers from re-entering the housing market and threatens those who may have to short sell with the same, and address that the "fixes" have problems that need to be corrected, then it may be possible to see a shift in the housing market. 

  1) 9.1 MILLION U.S. RESIDENTIAL PROPERTIES SERIOUSLY UNDERWATER IN FIRST QUARTER, LOWEST LEVEL IN TWO YEARS/April 15, 2014/By RealtyTrac Staff http://www.realtytrac.com/Content/foreclosure-market-report/q1-2014-home-equity-and-underwater-report-8037
2) Boomerang buyers return to market after foreclosure/By Les Christie @CNNMoney March 11, 2013 http://money.cnn.com/2013/03/11/real_estate/foreclosure-homes/
3) UNEMPLOYMENT, NEGATIVE EQUITY, AND STRATEGIC DEFAULT/KRISTOPHER GERARDI, KYLE F. HERKENHOFF, LEE E. OHANIAN, AND PAUL S. WILLEN/WORKING PAPER 2013-4/AUGUST 2013
http://www.frbatlanta.org/documents/pubs/wp/wp1304.pdf
4) The delinquency requirement for a short sale has historically been required by lenders for short sale approval. Recently, lender have NOT been requiring delinquency, or a shortened period such as 31 days, required on an FHA short sale.
5) This was never a problem with FHA and VA mortgages. The Total Scorecard, a secondary automated system, parallels the Fannie Mae Desktop Underwriter/Originator and the Freddie Mac Loan Prospector. FHA and VA mortgages with a past short sale typically receive an approval but with verbiage that discloses there may be a past pre-foreclosure or foreclosure with direction to confirm and adjust per FHA/VA guidelines.

Simple Ways to Get Your Home Ready to Sell

For those homeowners that have waited to sell their home, heed the advice of Nike: “Just Do It.”  Interest rates are still really low and the upcoming changes in mortgage lending may disqualify some buyers.  Now is the time to sell your home.  In order to help your home sell quickly follow the timely advice offered below.

Spend a Little Now to Get More Later

With so many homes available many buyers are seeking out a property that is move-in ready.  This means that small repairs and maintenance items will possibly turn off some buyers.  Take a walk through the home and pick out the small things that need to be fixed.  Leaking faucets, a chipped tile, a flaky bit of paint and other similar items can negatively impact the appearance of your home.

You should also consider spending a little money to get the carpets thoroughly cleaned and ask a local heating/air conditioning company to service your unit.

Put Yourself in the Shoes of the Buyer

If you are looking for a new home, what items are important to you?  The majority of people want to live in a clean home that smells nice with lots of room in the closets, cabinets and other storage areas.  Therefore, you should put a lot of time in to making your home look clean, neat and organized. Start with the cabinets and closets.  Remove as much clutter as possible and even add some shelves if it helps improve the look.  Go through all the rooms and put everything away in a nice, orderly fashion.  Finally, get a few aroma dispensers and put them throughout the house.

Make People Interested in Coming Inside

So many homeowners spend time, money and a lot of effort improving the inside of the home that they ignore the outside appearance.  It is important to have an inviting appearance.  Homeowners should trim all the bushes, clean out the gutters, make sure the driveway and walkway are clear and clean the windows.  For people that have siding, consider power washing the siding as well.  It is really important that the front door and the surrounding entrance area look clean and homey.

Two Important Rooms: Bathrooms and Kitchens

The bathroom and kitchen will usually have more influence over selling a home than any other part of the house.  It is a good idea to go through these rooms and spend extra time, and even money, to make sure they look attractive and modern.

Many types of cabinets can be painted with a little bit of planning and work.  All bathroom plumbing should be in good working order.  Make sure there is plenty of light with good looking fixtures and that the ventilation to both the kitchen and bathroom is more than adequate.  Also, make sure the counters are clean and devoid of clutter.

It may seem like a crazy idea to spend money on a home that you are planning to sell.  However, spending money in the right areas can greatly improve your chances of selling the home faster and may yield a good return on the investment.

Why list your home with Rock Realty?? Rock Realty Marketing Outline

Recent Testimonials: Rock Realty Client Testimonials

Rock Realty Client Testimonials

"I found Rock Realty on the internet while looking for someone to help us sell our house .. I called and talked to Mike, we set up an appt and he got the ball rolling... and wow did he get the ball rolling..he stepped up in every aspect.. the house was all over the net and we had people looking at the house right away .. he was right there every time we had questions and made us feel as if we were his only client.. he worked thru any difficulties we had without any negativities...our house sold Very quickly and Mike really stepped up through the whole process... Our thanks to Mike and Rock Realty"

Scott H. (Janesville, WI)
Rock Realty Seller Client

Thanks for the compliments, and Congratulations on your closing Scott!

Looking to sell your home at a great price!? Check out what Rock Realty can do for you!

Rock Realty Online Marketing Plan

Short sales are notorious for their duration to close. It was only years ago when we saw short sales take sometimes up to 2 years to close, causing insurmountable stress to all parties, especially to the seller. So why do short sales take so long? One could easily blame the banks for the delay. However, that accusation does not apply to most banks in 2013. Systems have been upgraded, buyers are buying, and incentives to short sell for both banks and sellers have boosted. So why would a short sale take so long?

Homeowner Motivation

We set expectations from the beginning with all of our clients. A short sale is great deal for the homeowners but it will require about 90-120 days of effort to get the job done. Agent’s who have done short sales will know this. Homeowners who delay in submitting requested documents are the ones who end up prolonging the deal longer than it should and/or losing their home to foreclosure. The lack of motivation on the homeowner’s part will diminish the motivation of the other players.

Who are these other players? The banks/lenders and the buyers.

Bank/Lender: If you’ve ever dealt with them via a loan modification process, you will know they need accurate documents in a timely fashion. Documents have an age. They will ask you to resubmit your paystubs or bank statements if they are outdated. I’ve heard many files closing because of the lack of recent seller documentation.

There could also be two liens meaning you will have to submit the package to two banks and deal with another party. Often times, the second lien is not easy to deal with because they typically receive a much smaller payoff.

Buyers: A couple of years ago, the buyers were one of the most difficult parties to retain in a deal. Buyers are much more motivated now because of the low inventory but put yourselves in their shoes. You have money (cash or preapproved) and you have opportunities around you. There is usually an emotional tie into buying a home. If you have to wait more than 3-4 months on a home, how likely are you to lose that emotion and run off to another opportunity during those 4+ months?

Short sales are like a 3-4 month boot camp. We have been fortunate with our clients thus far but we’ve also set expectations from the beginning. Agents, please show your clients this article before starting them off on a short sale or you could easily waste 4+ months of time, energy, and money. Article here:

The listing agent is another player and is the most important one and as you can read in my many articles, I have high expectations for them.

Hope this helps

Peter from www.seattleshortsaleblog.com

Rock Realty Client Testimonials

"This was a great effort from Mike Collins. He did a super super job with the selling of our home in Wisconsin. I could not ask for more from him as he kept me well informed of things going on and we are 1200 miles apart. He did more than a 110 percent job on everything. Even removing snow and whatever it took to have our home ready to show. Again, THANKS Mike for everything. Great Job!!!!!!"

Phyllis Pearson (Rock River, WY)
Rock Realty Seller Client

Thanks for the compliments, and Congratulations on your closing Phyllis!

Rock Realty Client Testimonials

"I had a very challenging home sale and Mike Collins was diligent every step of the way. The most difficult aspect may have been me, I was very specific about which closing dates worked and how I wanted to proceed. Mike patiently answered all of my questions and accommodated all of my requests. When issues between the title and mortgage companies arose, Mike was a swift and competent negotiator. I know that the buyer's agent was very impressed with Mike as well. My house had an accepted offer within 10 days of listing. I am amazed that it all went so smoothly. THANKS MIKE!"

John B.(Madison, WI)
Rock Realty Seller Client

Thanks for the compliments, and Congratulations on your closing John!

Rock Realty Client Testimonials

"My first listing contract (with another agency) expired without a single showing. I contacted Mike Collins hoping to get some straight advice about whether he thought the property would ever sell versus letting the lender foreclose on the property and save my mortgage payments for legal counsel. He was upfront from day one. He told me that it would take a while and that I'd probably have to hold it through the winter (I called him in September) but it would probably sell in the spring. His honesty made me immediately willing to hire him. He found a buyer in May and worked with my lender to close the sale in record time."

Drew V.(Marshall, WI)
Rock Realty Client

Aurora has aproved a short sale but offered the second $0.

After negotiating the second (STCU a small local crdit union) will take  $5K.

The buyer is willing to pay the $5K.

There are additional closing costs that Aurora did not offer to cost, approx $570.

We are having issues as to wher this information appears on the HUD-1.  I am thinking line 409 as a POC for the $5k and I am not sure where the additional closing costs fees fit.

Should the adendum to the purchase and sale agreement be made for the $5570 with the defiency being waived and then increase the purchase price?

If you have any HUD-1's you can e-mail me or fax me giving examples of what has worked I would really appreciate that.  I'll take samples of any HUD-1's you're willing to offer.  I am willing to share what I get minus the person's office and personal client information.

I have an attorney on board but we are having issues getting the answers from the banks as to what will work.

No cover letter necessary.  I am a one person office.

I only have until Januaty 10th to close.

Teresa Simon

509 535 6500

Fax 509 532 8000

tj@alacartenw.com

.

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!

Birmingham MI Home Sellers listing Tip#1, "Check The Financing"  Mike Sher, (248) 496-1572, Max Broock

With such a difficult Real Estate environment, seller's and Real Estate agents get so excited when they get an offer they forget the fundamental of financing.   The Agent also needs to but does NOT call the lender to verify the buyer's employment, reserves and credit.  Plus, the agent needs to verify the credibility of the lender itself and if there are concerns, the seller should request the buyer to get a preapproval from a local bank to assure financing is secure.   Also, the agent forgets to require proof of the down payment or inquire if the buyer has a home to sell.   The offer they sign often requires t a 45 to 60 day pending period in the Realtors Multiple Listing System until closing and keys at closing.

You can guess what happens; the buyer's lender does not come through because of incompetence or unfamiliarity of local lending rules.  Perhaps the buyer does not have the money to close after all or was qualified with older employment history.  Sometimes the credit score was so close to the minimum limit which dropped prior to closing and now the buyer does not qualify. 

Now the seller has a vacant home that has been off the market for 45 to 60 days or more.  They paid for movers, bought a new home or signed a rental agreement.   Yes, a NIGHTMARE!!!   All could have been avoided by some Realtor Due Diligence.   Make sure that when you get your next offer, the Realtor is NOT SLEEPING AT THE WHEEL.

Mike Sher is an Associate Broker with Max Broock Realtors of Bloomfield.  The Mike Sher Team  had over 15 years of Residential Real Estate experience in the Bloomfield, Birmingham, Beverly Hills, Franklin, Novi, West Bloomfield, Royal Oak, Huntington Woods, Orchard Lake, Farmington Hills, Northville, Waterford, Troy, Rochester, Oakland Twp and White Lake area.  They average a sale a week and have sold more the 400 homes.  If you have or are looking for a  Oakland County home to sell or purchaser, call us today