Short Sale in Indian Wells, Calif......APPROVED! Just received my approval letter yesterday on this one. From List to 8/15 COE will be approx. 120 days. It is intriguing to me how some Short Sales sail along and others..seemingly very similar to my eyes, get stuck. This one is a vacation home for my Seller. He has two loans with Bank of America.
Primary Loan: $417,000 due
Second: $206,000.
APPROVED Sales Price: $465,000.
I wrote a blog yesterday about how much power the Negotiator assigned to your file, wields in the completion of the approval and eventual CLOSE of a Short Sale. This is proof positive. My negotiator was fantastic, and I sent her boss an e-mail about how well she handled my clients' file. Professional, communicative, on top of the file from the get go..and here we are..almost done. Wish I could request her again..
The other thing is that the loans were linked. The second had not been cut up and sold, and most importantly, no MI.
Does anyone have a solution or contact name/phone for someone in IT Tech Support than can provide a solution without being told to restart the whole process all over again???? Why is this happening all of a sudden? I have a total of six files which overnight relfect 'UNAVAILABLE". CS, negotiator, supervisors and IT Tech have no real answers or solutions....
Almost 1/3 of the homes currently for sale in Costa Mesa are short sales.
In Huntington Beach, nearly half of the homes in escrow are short sales. This is a problem that isn't going away any time soon, and for some people it is part of their daily reality.
If you have to do a short sale on your Orange County home, there are several things you can do to torpedo your sale.
1. Don't Pay Your Homeowners' Association (HOA) Dues.
- Many of the lenders won't pay past due HOA dues, and the short sale can't be closed without bringing the HOA dues current.
- If you can, keep your HOA dues current or plan to bring money to close to pay for them. Sometimes the lender will pay them, sometimes the buyer will, and sometimes we need can succesfully negotiate the amount, but late HOA dues can torpedo a short sale on your Orange County home.
2. Cash out your 401K
- Most lenders consider money in your 401K, IRA or retirement accounts to be "untouchable" money, money they won't usually require the seller to contibute to the short sale.
- However, if you cash in your retirement account, the bank will consider it fair game for contributions. So, if you don't want to contribute your retirement to your short sale, don't cash it out during your short sale.
3. File Bankruptcy
- Many banks will not agree to a short sale while you are in active bankruptcy.
- If they do agree, it may require that your trustee and/or judge must agree to the short sale.
- The bank may choose to file a Motion for Relief from Stay to take your home out of the bankruptcy and remove bankruptcy protection, which will allow it to sell the home through a foreclosure regardless of the bankruptcy.
- If you can avoid filing a bankruptcy during the short sale process, it will increase the odds that your short sale will be successful.
4. Keep your home poorly
- Buyers will judge your home based on several things including price, location and condition. If your home is poorly kept or is not show ready, they may not make an offer on it even if it's well priced.
- So, keep your home show ready so that it competes well against other homes for sale.
- A little time spent now keeping your home nice will make it more likely that it will sell close to fair market value and thus make a successful short sale more likely.
5. Use your home as an ATM machine
- If you pulled money out of your home to pay off debt, buy cars, take trips, etc., it may be harder to obtain a short sale.
- If the loan is not "purchase money" ( the loan used to buy the house), it is more likely to be a recourse loan (meaning the lender could get a deficiency judgment against you for the amount they don't recoup from the foreclosure).
- If the lender can get a deficiency judgment, they may be less inclined to grant a short sale, particularly without a cash contribution and/or a promissory note signed by the seller.
This is not an exhaustive list of things that will torpedo the short sale of your Orange Count home, but it will give you some idea of the problems you face when short selling your home.
If you have questions about short sales or about options to short sale, please contact me at 714.319.9751.
This is not intended to be legal or tax advice, nor am I advising you do any of the above items. The above is simply a discussion of items that may cause a short sale to fail. Please consultant an attorney and/or accountant when considering a short sale and/or facing foreclosure.
Certified Distress Property Expert Rochester Hills Michigan, "FTC validates that Realtors play a vital role in Short Sale Success" Mike Sher, Max Broock, 248 644-4700x242
On July 15th the FTC (Federal Trade Commission) statement admitted that their December 1st 2010 MARS (Mortgage Assistance Relief Service) Rule, which created penalties and limitations for parties (including Realtors) who offer mortgage assistance for homeowners, had"...unintended consequences that might result from applications of the advance fee ban, in the context of a real estate professional assisting a consumer in negotiating or obtaining a short sale " For that reason, the FTC will place "a forbearance of enforcement that applies ONLY to REAL ESTATE BROKERS...who assist consumers in negotiating or obtaining short sale...:
This ruling proves that Real Estate Agents play a fundamental role in the short sale process. If you are or someone you know needs to sell their home and has a loan that is greater than the value, I urge you to find a local realtor who specializes in short sale or call me and I can help or refer you to a qualified agent in your area.
The Mike Realtor Team sells Homes in Bloomfield, Birmingham, Beverly Hills, Farmington, West Bloomfield. Rochester, Troy, Huntington Woods, Royal Oak, Northville & Auburn Hills. Call us at (248) 644-4700 X 242 or check us out at www.ShortSaleOaklandCounty.com or www.mikerealtor.com Mike Sher
It really doesn't matter how experienced you are as a Short Sale List Agent. It doesn't matter how many CLOSED references you have..again as a Short Sale List Agent. When it comes to approval, it is a complete crap shoot with the Negotiator holding all the dice.
I can tell from the first e-mail exchange, and often phone conversation if they won't e-mail, whether or not I am dealing with a sane Negotiator.
The WORST negotiator I have ever had in the past 5 years was a Chase guy..I can still hear his plaintive voice telling me, "I'm sorry, but your Seller has too much money. She can pull out of her IRA and make that mortgage payment"
"No, she can't. She's retired, this home was a retirement hopeful, and she will let it go to Foreclosure as she has another mortgage for her primary res. However, she will definately make a cash contribution of the $10,000 you are requesting."
"Hmm..well, I understand what you're saying, BUT. I also see here that she charged $500 to Victoria Secret over the past few months. If she's so broke, why did she do that?"
I was cleaning my horses pens right then, and literally had to sit down on the wheelbarrow and put my head between my knees to keep from cursing like a wild woman.
He turned down the file. BAM! Here's the kicker. Chase called me two more times on this same file, requested that I re-open it because their guidlines had changed. I did, they rejected it again..generic rejection. "Your Seller has too much money." She chose to send them a letter telling them they could keep it as she was letting it go to Foreclosure. Almost 2 years later and it's still sitting empty, the landscape is shot and the pool is boarded over. Good decision!
That first guy still holds first position as far as insane negotiators.
No Deficiency Judgments after Short Sale due to Senate Bill 458?
There is good news for home owners who are considering short sales in California. Governor Brown signed Senate Bill 458 into law today. This new law prohibits servicers, lenders and investors from pursuing deficiency judgments against home owners of 1 to 4 unit residential property.
Deficiency judgments on similar properties were prevented by CCP 580e last year, but only on first mortgage. Senate Bill 458 extends this protection to second mortgages and other mortgages as well.
The protection of Senate Bill 458 shall not apply to home owners who commit fraud or waste or to LLC, corporations, limited partnerships, political subdivision of the state, lien secured by a bond as specified, or public utility lien. There are additional rules for notes that are cross collateralized with more than one property.
Disclaimer: This article is not intended as tax or legal advice. Those considering a short sale are advised to consult an attorney and/or tax professional regarding any potential liability. This article is not intended to solicit listings currently listed with another broker.
About the author: Christine Donovan is a California Residential Real Estate Broker with experience in assisting clients buy and sell residential real estate.
Are you upside down in your home? Is it worth less than you owe? Are you concerned about making your mortgage payment? For more information see Options to Foreclosures, understanding short sales or contact me at christine@donovanblatt.com to discuss your options.
Contact me at christine@donovanblatt.com or 714-319-9751 to learn about her system which will make your buying and selling experience easier.
Disclaimer: All information in this blog is deemed reliable but is subject to change at any time and is not guaranteed to be accurate nor are there any warantees either express or implied. This blog is not intended to offer any legal, tax or other advice.
Federal Government Disclaimer (MARS)
You may stop doing business with us at any time. You may accept or reject the offer of mortgage assistance we obtain from your lender [or servicer]. If you reject or accept the offer, you do not have to pay us.
Christine Donovan, DonovanBlatt and Donovan Group are not associated with the government, and our service is not approved by the government or your lender; and
Even if you accept this offer and use our service, your lender may not agree to change your loan.
It's an answer to all of our prayers I'm sure. Begging them to consider your backup and not start over only to find out it gets reassigned to a new negotiator and the last has deleted your file. *small sigh of relief*
I'm sure you all received this email, but just in case this is what I got;
As an example of our commitment to improving the short sale process, Bank of America now allows real estate agents to submit a backup offer on a transaction if the original buyer has walked away from the sale. This means you will no longer have to initiate a new short sale; instead, you can continue with the original transaction in Equator and still work with your same short sale specialist. This change will save you time by not having to repeat a number of process steps.
When a Backup Offer Is Ready
You should send a message to your short sale specialist via Equator when the original buyer is no longer interested in the property. Your short sale specialist will then respond to you within two business days and ask if you have a backup offer ready to submit. If you have another buyer prepared to make an offer, the short sale can proceed without having to repeat the short sale initiation steps. The short sale status in Equator will change to "Marketing," and you will be directed to complete the following tasks within 14 business days:
· Complete the "Listing Data" task.
· Provide the marketing description.
· Review the marketing plan.
· Upload the offer. (To do this in Equator, locate "My Properties," then "Offers" and select "Place New Offer.")
If the "Listing Data" task is not completed and the new offer is not uploaded within 14 business days, the file will be closed.
When No Backup Offer Is Ready
This new process applies only if there's an available backup offer when a buyer walks. If you do not have a backup offer ready to be submitted, the short sale will be declined. In that case, you should return to marketing the property and initiate a new short sale in Equator once you receive another offer.
A new educational guide, How and When to Submit a Short Sale Backup Offer, is available to explain the backup offer process. If you have any questions, please contact your short sale specialist via Equator or call Customer Care at 1.866.880.1232.
Visit the Real Estate Agent Resource Center at bankofamerica.com/realestateagent for additional educational guides, news and resources to help you complete short sales at Bank of America.
Los Angeles, CA – Just in, Governor Brown, signed into law today, SB458. This law will be written in the California Civil Code Procedures under CA CCP Section 580(e).
What this law states is that if a homeowner does a short sale, where the property has a 2nd Trust Deed, that 2nd lender/investor can no longer pursue the homeowner for the deficiency balance if they agree to entertain a short sale. If you recall, SB931, which came into effect as of January 2011, protected California homeowners from their lender/investor from coming after them for the deficiency balance on ONLY the 1st Trust Deed. What SB458 does now is that it encompass the 1st and 2nd Trust Deeds and protects the California homeowner from the possibility of their lender/investor from perusing the deficiency balance.
In Layman’s terms: If the 2nd Trust Deed Lender agrees to the short sale, they’re also agreeing to waive their right to collect on the deficiency balance!
There are two key things to point out here:
1) SB458 does not state that the 2nd TD Lender cannot ask for a cash contribution from the seller at closing.
2) SB458 does not state that the 2nd TD Lender cannot ask for a unsecured note from the seller at closing.
Thinking about a loan modification? Our Glendale loan modification kit will show you how to reduce your mortgage payment, keep your home, and get back on your feet. Send me an e-mail at cme4homes@jenniferescobar.com to request a Free Copy. Or, click here to request a copy.
Want more information about a California Free Loan Modification? Our FREE Loan Modification Services will help you get a loan modification approved with your lender.Click here to for more information regarding my FREE LOAN MODIFICATION SERVICES!
Thanks for reading this, Jennifer Escobar.
Jennifer is a Real Estate Agent at Qwest Real Estate.
Los AngelesShort Sale Specialist | Los Angeles Short Sale | When to short sale in Los Angeles | Los Angeles Short Sale Taxes | Why Short Sale in Los Angeles | Los Angeles Short Sale Requirements | Los Angeles Short Sale Guidelines | How does short sale work in Los Angeles | Los Angeles Mortgage Short Sale
Bank of America just announced a change in its short sale program that may make Bank of America short sales just a little easier.
Until today, if Bank of America short sales were entered in Equator and then a buyer walked, the whole short sale process would have to start all over again. Even if the new buyer made exactly the same offer, the process had to start all over again.
This week, finally Bank of America, decided this was unnecessary. Now the original transaction will continue with just the buyer substitution. This may not work in all cases depending on the actual investor on the loan. Still it's a definite step in the right direction and should help to alleviate the pressure and the wait when a buyer walks as they sometimes do during the Bank of America short sales process.
About the author: Christine Donovan is a California Residential Real Estate Broker with experience in assisting clients buy and sell residential real estate.
Are you upside down in your home? Is it worth less than you owe? Are you concerned about making your mortgage payment? For more information see Options to Foreclosures, understanding short sales or contact me at christine@donovanblatt.com to discuss your options.
Contact me at christine@donovanblatt.com or 714-319-9751 to learn about her system which will make your buying and selling experience easier.
Disclaimer: All information in this blog is deemed reliable but is subject to change at any time and is not guaranteed to be accurate nor are there any warantees either express or implied. This blog is not intended to offer any legal, tax or other advice.
Federal Government Disclaimer (MARS)
You may stop doing business with us at any time. You may accept or reject the offer of mortgage assistance we obtain from your lender [or servicer]. If you reject or accept the offer, you do not have to pay us.
Christine Donovan, DonovanBlatt and Donovan Group are not associated with the government, and our service is not approved by the government or your lender; and
Even if you accept this offer and use our service, your lender may not agree to change your loan.
Posted by Dave Halpern on July 15, 2011 at 10:30am
My client is doing a short sale on an investment property. Sales price is $175,000. The first mortgage, Citi, Is taking a short sale and allocating $4,500 towards the second mortgage which is 5th 3rd.
5th 3rd wants the entire remaining balance of $40,000 to be repaid by the seller. 5th 3rd wants the seller’s current 2nd mortgage on the investment property to be transferred as a third mortgage on the seller’s personal residence. The seller may have maximum $5,000 to $10,000 equity in their personal residence, but not really if you factor in selling costs and closing costs.
5th 3rd demands, per some “policy”, to have the seller encumber his personal residence up to 140% of its value.
5th 3rd also disregards the seller’s financial statement. The financial statement shows about $2,000 monthly negative including the loans that are included in the short sale. After the short sale, the seller will be barely breaking even.
5th 3rd claims that according to his credit report he has $2,000 of discretionary income, even though the CREDIT REPORT DOES NOT REFLECT most of his expenses such as groceries, baby expenses (two babies), utilities and most of the expenses needed to run a household. 5th 3rd is plucking numbers out of air and is unwilling to explain their math.
The sellers refuse to jeopardize their personal residence and the roof over their babies’ head and are ready to pull the trigger on a chapter 7 bankruptcy to shake loose of the problem. They have spoken to a BK attorney who confirmed their chapter 7 eligibility. The BK attorney has sent a letter to 5th 3rd clarifying the situation.
5th 3rd also states they would rather get ZERO dollars in a foreclosure and bankruptcy rather than $4,500 now! Does 5th 3rd get reimbursed more by TARP or other source if they get ZERO from the seller?
We have appealed and escalated to a manager, but 5th 3rd’s answer always comes back the same: FIRM DENIAL.
We now want to escalate as high as we can. Does the group have any experience, suggestions or contact info within 5th 3rd?
According to Lender Processing Services (LPS), over 6.32 million homeowners missed their mortgage payments in April 2011. Another four million have missed more than three months of payments and are now considered seriously delinquent. If you or someone you care about is having difficulty making mortgage payments, it's not too late to get help.
I have developed a report filled with information that every homeowner should know. It's a guide on how to avoid foreclosure and how I can help work with lenders to resolve an unaffordable mortgage. You can download the report at the following website:
There is financial stability on the horizon-I can help put an overwhelmed homeowner on the path to get there. If you or someone you care about needs help, I'm only a phone call away.
Sincerely,
Mike Sher Max Broock Realtors 248 496-1572
2010 results: 75 units sold, over $10,000,000,00 in sales and 365 days of FOCUS!
The Mike Realtor Team sells Homes in Bloomfield, Birmingham, Beverly Hills, Farmington, West Bloomfield. Rochester, Troy, Novi, Huntington Woods, Royal Oak & Auburn Hills. Call us at (248) 644-4700 X 242 or check us out at www.ShortSaleOaklandCounty.com or www.mikerealtor.com Mike Sher
We recommend consulting an Attorney and/or Tax Professional to discuss your options.
Federal Trade Commission Disclosures
1. You may stop doing business with us at any time. You may accept or reject the offer of mortgage assistance we obtain from your lender (or servicer). If you reject the offer, you will not have to pay us for our services.
2. The above brokerage is not associated with the government, and our service is not approved by the government, and our service is not approved by the government or your lender.
3. Even if you accept this offer and use our service, your lender may not agree to change your loan.
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
Wondering what a homeowner should expect when payments are missed? The most important thing to know is that no matter what stage of default a homeowner is in, there is almost always a way to avoid foreclosure. That being said, the quicker a homeowner does something about the situation, the less challenging it will be to resolve.
First, here's what a distressed homeowner should expect to happen when payments are missed:
30 Days Late: The lender will attempt phone contact or send a notice in the mail.
60 Days Late: The lender will attempt to make contact by phone and follow up with another letter in the mail.
90 Days Late: The lender will send a letter demanding all past due amounts within 30 days and start the foreclosure process.
120 Days or More Late: The lender's attorneys will take over and the homeowner will be responsible for their fees in addition to missed mortgage payments and the loan amount due.
120-480 Days Late: Michigan has a 6 to 12 month redemption period that allows a homeowner to sell their home on a short sale to avoid the lender taking the home by Foreclosure.
Not late yet, but about to be?
Homeowners that are not late but foresee missing payments should communicate this to their lenders as soon as possible. In the past, many banks wouldn't work with homeowners unless they were one or more payments behind. In light of the mortgage crisis, most lenders who would rather take a proactive stance and decrease their loan losses. They are more willing than ever to work with homeowners to avoid being late.
If you visit my website, www.ShortSaleOaklandCounty.com you or someone you care about may be missing mortgage payments now or in the near future. I can help navigate the process and put you back on a path to financial stability. Contact me today and alleviate the stress that comes with unaffordable mortgage payments.
The Mike Realtor Team sells Homes in Bloomfield, Birmingham, Beverly Hills, Farmington, West Bloomfield. Rochester, Troy, Huntington Woods, Royal Oak, Northville & Auburn Hills. Call us at (248) 644-4700 X 242 or check us out at www.ShortSaleOaklandCounty.com or www.mikerealtor.com Mike Sher
Great news!!! Finally Bank of America has changed their Equator rules to allow Realtors to switch buyer's if the first buyer walks away. This will improve the short sale process for Bank of America Serviced loans. This is great for the seller, great for the investor and great for the buyer. By allowing Realtors the option of swapping buyers, the short sale time process will be greatly reduced. If you have any Short Sale questions and live in Oakland County, please give me a call at 248 644-4700 x 242
Now You Can Substitute a New Buyer for One Who Walked Without Restart
As an example of our commitment to improving the short sale process, Bank of America now allows real estate agents to submit a backup offer on a transaction if the original buyer has walked away from the sale. This means you will no longer have to initiate a new short sale; instead, you can continue with the original transaction in Equator and still work with your same short sale specialist. This change will save you time by not having to repeat a number of process steps.
When a Backup Offer Is Ready
You should send a message to your short sale specialist via Equator when the original buyer is no longer interested in the property. Your short sale specialist will then respond to you within two business days and ask if you have a backup offer ready to submit. If you have another buyer prepared to make an offer, the short sale can proceed without having to repeat the short sale initiation steps. The short sale status in Equator will change to "Marketing," and you will be directed to complete the following tasks within 14 business days:
· Complete the "Listing Data" task.
· Provide the marketing description.
· Review the marketing plan.
· Upload the offer. (To do this in Equator, locate "My Properties," then "Offers" and select "Place New Offer.")
If the "Listing Data" task is not completed and the new offer is not uploaded within 14 business days, the file will be closed.
When No Backup Offer Is Ready
This new process applies only if there's an available backup offer when a buyer walks. If you do not have a backup offer ready to be submitted, the short sale will be declined. In that case, you should return to marketing the property and initiate a new short sale in Equator once you receive another offer.
A new educational guide,How and When to Submit a Short Sale Backup Offer, is available to explain the backup offer process. If you have any questions, please contact your short sale specialist via Equator or call Customer Care at 1.866.880.1232.
Visit the Real Estate Agent Resource Center atbankofamerica.com/realestateagentfor additional educational guides, news and resources to help you complete short sales at Bank of America.
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Questions / Comments: If you have any questions or comments related to Bank of America's short sale process please contact our Customer Care line at 1-866-880-1232 or visitbankofamerica.com/realestateagent
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Bank of America Short Sale 8th Floor, 101 S. Tryon St. Charlotte, NC 28255-0001
Everything submitted, BPO ordered but not back yet. Sale date July 20. BofA is refusing to postpone the date because my seller is 12 months behind. Any ideas on how to resolve this? (Seller willing to contribute.)
I just recieved a response from the BOA (1st) negotiator that Wells Fargo is the investor and will not allow more than 5% commission. Anyone have experience in this? The clock is ticking...
Read more…
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...
Article I posted on my site. This will help homeowners understand the urgency of selling their homes asap.
I am skeptical by nature and I do not believe in anything unless there exists substantial supporting evidence. At the end of the year 2010, I read and watched Peter Schiff discuss the housing market. Peter is the president of Euro Pacific Capital and the author of “How an economy grows and why it crashes.” Despite his outstanding critics, he predicted the housing market’s downfall long before the sharp decline in 2008 and his article posted in December 30, 2010 on wall street journal was #1 at the time.
I am not advocating that Peter Schiff is correct in all his thoughts but his beliefs cannot be devoid of merit as he has been accurate in many of his theories such as an exponential increase in the price of gold and of course the housing slump that we are in today. His bold statement about the housing market was that, “they would have to decline another 20% just to get back to the historical trend line.” Schiff says prices will have to fall as they are still much too high for a market where there is a shortage of demand and an excess of supply. Why won’t demand increase? Inflation and the down economy (less jobs, utility costs are increasing, maintenance, taxes and etc.). He says, “Real estate prices will not keep pace with inflation.” Although Schiff is known to make audacious statements, he has been accurate in his assumptions and many experts beliefs are now parallel with his projections that the worst is yet to come and recovery may happen much later than previously expected.
So how does this affect you as a homeowner? It’s very simple. If you know you will be struggling to keep up with your mortgage payments, then making a decision for your home should be made in a timely manner because if the market value of your home decreases, the difficulty of selling your home via short sale will increase. Even if your property is foreclosed on (unless you are in an anti-deficiency state and have only 1 lien holder), your deficiency amount may be increasing as they may still pursue you for the difference between the auction price and the amount owed.
The housing market will get better eventually. However, will you be able to survive until it does? I believe it is optimal and a much safer option to rent until house prices hit rock bottom which is projected to be around 2014. If you short sale, you will be able to purchase another home later at prices that are unheard of. Buyers, currently the interests rates are excellent but unless you are absolutely certain that you’re able to afford purchasing a new home with enough savings in the bank and are looking long term, continue to rent. This is my honest opinion.
Until today, if Bank of America short sales were entered in Equator and then a buyer walked, the whole short sale process would have to start all over again. Even if the new buyer made exactly the same offer, the process had to start all over again.
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