by on Sep.08, 2009, under Article
ANDERSON, IN - Are you confused about whether a short sale or foreclosure is better? If so, you’re not alone. As people across Central Indiana find themselves unable to keep up with their mortgage payments, many are looking into short sale options. While property taxes were a hot issue just a short time ago, bank foreclosures and the housing market is the topic now. People are still trying to keep their houses, but for other reasons.
Many people are turning to things like the "short sale" to avoid foreclosure. Simply put, a short sale in real estate refers to a sale that falls "short" of a loan balance due. When sold this way, the bank (or other lending institution) agrees to allow the sale of their security (the property) for an amount that is less than owed to them.
"…the short sale process is almost always better than foreclosure for a number of reasons…" Perry Knox While there are many reasons they may do this, one of the biggest is an acknowledgement of the decline in the value of the property due to economic conditions. Banks realize that many homes are worth less than the balance of the loan, and they have been attempting to work with home owners to sell their homes and pay off their mortgages.
Perry Knox, an auctioneer with Mark Volk Realty & Auction Company said, "During these current economic challenges and the implosion of the Real Estate Market, Lenders are more often accepting Short Sale Options now than they were just 3 years ago. If a lender agrees to accept less than the amount owed on a mortgage that does not necessarily guarantee the difference will be forgiven by the lender and this should be negotiated during the Short Sale Process."
According to Knox, the short sale process is almost always better than foreclosure for a number of reasons. For example, the lender may agree to "write-off" the short fall on the mortgage and the homeowner will not be required to pay that back. Even in that case, there will most likely be a "write-off" on their credit report (which is still better than a foreclosure and possible subsequent bankruptcy, according to Knox and others.)
A short sale may prevent bankruptcy, which could enable the homeowner to possibly re-purchase a home and secure a mortgage without the 3 year delay associated with a foreclosure. This is possible good news for Hoosiers all over the state. It makes sense to see what your options are before making a decision.
To be eligible for a short sale, a homeowner must be in arrears on their mortgage payments by at least 3 months and have not been notified by the lending institution of foreclosure or sheriff’s sale proceedings.
According to Knox, "A homeowner in this position that does not see the ability to bring the mortgage current and is out of options with the lender should contact a broker right away and have them do a Broker’s Price Opinion (BPO) on what the current market value of the property is. If upon signing of a listing agreement and a preliminary acceptance of a BPO by the Lending Institution, you may have just gained a little time before a foreclosure. Typically a Lender will delay Foreclosure if they know that there is a Broker out there trying to sell the property, while working with a cooperative seller, for a preliminarily approved sale amount."
When making the final decision on whether a short sale is the better option, homeowners should take all this information to heart and work with someone who knows the entire process and has been through it before.
"One of the best pieces of advice I could offer a homeowner that has begun a Short Sale Process with a Broker/Agent is to work with that Broker/Agent carefully and properly prepare your home for showings and be timely in producing required documents as they become necessary for the Lender," Knox said. "Just because the Short Sale Process is accepted does not mean Foreclosure may not happen. The Broker/Agent has only a limited time period to gain an Offer to Purchase from a prospective Buyer."
If the property continues to deteriorate and does not show well, a prospective buyer is less likely to make an offer and foreclosure becomes more of a reality. By acting within the timeframe, many Hoosiers are finding an alternative to foreclosure that works for them.
by on Aug.28, 2009, under Article
Over the past 2 two years, mortgage guidelines have tightened and one of the lasting impacts on home buyers is that it now takes a larger down payment to buy a home.
It’s as true for conventional home loans as it is for FHA ones — banks want to see more of home buyer’s own skin in the game.
Unfortunately, not every buyer has the cash.
This is one reason why — anecdotally — the number of home buyers asking for "down payment gifts" from family members is rising. With home prices down, mortgage rates low, and a generous first-time home buyer tax credit in place, there’s a lot of would-be homeowners that don’t want to miss out on the action.
However, if taking a gift of down payment is part of your upcoming home financing strategy, you need to know that there’s a right way and a wrong way to do it. You can’t just deposit your parents’ money into a bank account.
Accepting cash for a down payment is a 3-step process. Follow the steps to a tee, or expect an underwriter to disallow the gift as a source of down payment.
First, complete and sign an acceptable gift letter. There are lots of variations on the "Down payment Gift Letter" but each follows the same basic format.
- Includes the amount of the gift
- Includes the subject property address
- Includes the relationship of the gifter to the giftee
- States that the gift is actually a gift and not a loan
- Signed and dated by all parties
If you don’t have a template gift letter on-hand, send me an email and I’ll forward you the one I use for my clients.
Next, with the gift letter in place, the gifter should to make an extra strong paper trail for the money being gifted. This is one reason why certified checks are preferable to wire transfers. Both are acceptable methods of gifting, but certified checks are easier to document and simpler to prove — all it takes is a teller receipt.
Make sure the amount of the gift matches the amount specified on the gift letter.
And, lastly, when receiving the gift, the giftee should be careful to accept the gift as-is. Deposit it with a live teller in a branch bank and make sure the deposit is not commingled. If the gift is for $10,000, for example, make a $10,000 deposit — nothing more, nothing less. Don’t add a random $100 check to the deposit, in other words.
Follow these 3 steps, though, and everything should be fine.
Meanwhile, there might be legal and tax liabilities when gifting funds between family members. If you’re unsure about how donating or receiving a gift might impact you, be sure to talk with your attorney and/or accountant.
by on Aug.28, 2009, under Article
Millions of homeowners across the country are hanging on for dear life, making their monthly payments and hoping and praying that the value of their homes – once thought to be akin to a virtual retirement account – will rebound from historic lows.
How bad has it been? According to the S&P Case Shiller Home Price Indices, U.S. homes have lost roughly a third of their value from May 2006 to May 2009.
Things didn’t get better right after that. The real estate web site Zillow.com reports that sales of previously foreclosed homes accounted for 22% of all home sales in June, and that 29.2% of homes sold for less than the original purchase price over the same time period.
But August has been a bit kinder to U.S. homeowners. S&P Case Shiller posted its first positive quarterly index in three years earlier this month, suggesting that the housing market is back on track.
But how can we really be sure? Let’s look at a few key indicators that would, if they transpire, suggest that the U.S. housing market has finally hit bottom – thus triggering the popping of champagne corks from Catalina to Key West.
Momentum after the $8,000 new homeowner tax credit expires. This one may take until November to know for sure – that’s when the new homeowner tax credit goes away – but if the number of home buyers still remains strong, even without the government tax credit, the outlook should be a rosier one.
Home construction stocks inch up. Big companies in the home construction business, like Toll Brothers (Stock Quote: TOL) or even Home Depot (Stock Quote: HD) have been hit hard by the economic downturn. But watch them closely in the coming months. In particular, watch their profit margins – look for same-store figures – in equally hard-hit regions like California and Florida. If their balance sheets stabilize, and their stock prices shoot up, then chances are we’re actually out of the woods.
Look for inventory to drop. There are a millions of houses on the market right now, and many banks are holding back tens of thousands more in what real estate professionals have come to know as “shadow” properties. But the tide is beginning to turn, as housing inventory at the end of June, according to Keller Williams Research, fell 0.7% to 3.8 million, representing a considerably lower 9.4-month compared to a 9.8-month supply in May. If inventory continues to decline at those levels or better, go ahead and get that champagne out.
Of course, there are other key benchmarks to study. Unemployment (which is lagging right now), a reduction in rental properties, consumer sentiment, lending liquidity and average U.S. home prices should also be factored into the equation.
Altogether, these numbers will tell the tale. Hopefully, it’s a tale worth celebrating.
by on Aug.08, 2009, under Article
Knowing what kind of house will suit your lifestyle, finding real estate agent and gaining a sense of the process may be all needed to unlock the door to your dream home. Buying a home takes preparation and knowledge. The division recommends using these following five basic tips as a guide from beginning to end of the process of buying a home.
Step 1. Prequalify For A Loan: Select a lender, then make an appointment with the lender to determine eligibility, and based upon that information, the purchase price of the home you can reasonably afford.
Step 2. Take a First-Time Homebuyer Education Class: The division cannot emphasize how important homebuyer education is for the first-time homebuyer. It is required by the division for all of the division’s down-payment programs. It is recommended that a person attend a six- to eight-hour class in order to receive full benefits of the dos and don’ts of looking for and buying a home.
Step 3. Locate An Affordable Residence: Begin looking for a residence priced in the range that the lender advises can be realistically afforded. Don’t become house poor with all the income going into the house and not having any disposable income. Using the services of a real estate professional can take a lot of stress out of looking for a home; a real estate professional will have a number of listings to show without having to drive around neighborhoods looking for houses. Focus on what can be afforded; looking for a home can be fun — enjoy the experience. Use all resources such as home builders.
Step 4. Enter Into a Real Estate Purchase Contract: Once you feel you’ve found that perfect home, an agreement or contract to purchase is made. This contract will specify the legal obligations of the seller and the buyer, which should establish a specific date of purchase and set the price of the home. This contract should allow for enough time to complete a home inspection or if other unfavorable technicalities arise regarding identified requests. This will protect you if the contract needs to be canceled and earnest money refunded.
Step 5. Apply For a Loan: At this point, you can formally apply for a loan. If, for instance, it’s a Nevada Housing Division loan, you would work through one of their participating lenders. After you have applied, the lender will request that the Housing Division reserve funds for the loan at a specified interest rate.
STATE DEPARTMENT OF BUSINESS & INDUSTRY, HOUSING DIVISION
by on Aug.05, 2009, under Article
If you are new to short sales or searching for your first deal, chances are you might have more time than cash on hand. Fortunately, short sales provide equal opportunity profits for those willing to put in a little extra effort. Use this top ten list to search for properties likely to qualify for super low-ball offers or favorable terms for taking the property off the bank books.
1. Environmental Issues. Mold, lead paint, meth lab/drug bust or even a swimming pool filled with green scum all constitute environmental issues the bank would prefer not to deal with but a gold-mine for those willing to tackle the tough job of clean-up.
2. Abandoned or neglected homes. Banks hate it went houses are vacant; not only does it increase the risk of theft, property destruction and even injuries but it often results in further depreciation of the property.
3. Unfinished homes. Any house that did not receive a certificate of occupancy or COO is typically not eligible for a traditional mortgage until the work has been completed. The longer the house remains unfinished, the greater the risk of changes to the building code or other costly penalties. These homes can often qualify for exceptionally deep discounts with the added advantage of being "like new" once completed.
4. Damaged. Properties with deferred maintenance or damage that needs to be repaired are often reduced far below the cost of needed repairs. Look for home that need a new roof, windows or other relatively simple jobs that others avoid.
5. Hostile Tenants. In most situations an occupied home is preferred but there are exceptions to every rule. Rude, hostile and non-paying tenants are exactly the type likely to make most investors take a second look at even the most appealing property. Few people enjoy the process of evicting a tenant but for those willing to learn the rules of the road, taking on someone else’s problem is a great way to get a low price property.
6. Code Violations. Whether it is an illegal garage apartment or a property that was used out of compliance with zoning, code violations are more than a mere headache to banks. You will need to work closely with the code, permit and zoning offices in your area to let them know your intent to "make right" on the violation.
7. Pools, Ponds & Other Water Problems. Plain and simple, banks hate water problems of any type. What might be considered a big selling point by some is nothing more than a lawsuit waiting to happen in the banks eyes; the greener and less secure the pool or pond, the bigger the threat.
8. Nonconforming Property. Land use permits, variations that were grandfathered in and other nonconforming property situations are often major headaches for lenders…if they even realize the situation. Take inventory of the situation to determine if it is worth the time and effort to bring it to the lenders attention.
9. Expensive Properties. When the lender takes over the property they are required to keep up with HOA, maintenance and other fees which can add up over time. It isn’t always the dollar amount but rather the relative cost of the fees as compared to the total price of the property that matters most.
10. Picture This. Like the old adage, "a picture is worth a thousand words"…that goes twice for short sale properties that have any type of problem. Make a point of taking photographs – plenty of them – and including copies for all interested parties.
source Chris McLaughlin
by on Jul.21, 2009, under Uncategorized
Jul 20, 2009 0:00 – By: P. Ling
The auction of the landmark Watergate Hotel in Washington DC is generating a bidding frenzy amongst developers and real estate investors. Bidding starts at $1m on Tuesday at 10.15 am at the Wisconsin Ave offices of Alex Cooper Auctioneers.
Watergate Hotel in Washington D.C.
This historic hotel – located across from the Kennedy Center and half a mile from the Lincoln Memorial – now stands desolate and abandoned to the elements, another victim of the recession which has seen hundreds of hotels going into default and being foreclosed.
Monument Realty, the current owners, have left a $40 million loan hanging around the hotel’s neck, but that’s just one part of the screw-up. The owners shuttered the hotel in 2007, and were in the process of converting the Watergate into a luxury hotel/residency complex. This $100 million makeover plan came to a screeching halt when one of the financiers – Lehman Brothers – went bankrupt last year.
Richard Nixon leaves White House
The only saving grace is the hotel’s history and national landmark status. The Watergate Hotel is famed for being the place where the Watergate burglars snoozed in 1972 before breaking into and pilfering documents in the adjacent Democratic National Committee HQ office - a crime which implicated Richard Nixon and forced him to resign from the Presidency.
This historic status is attracting bidders for the hotel from all over – including local developers and international luxury hotel chains. Monument Realty purchased it for $45 million in 2004, but that figure now seems too high for the auction, which could end up anywhere between $20-30 million.
by on Jul.08, 2009, under News
Urge Congress and President Obama to Support $15,000 Home Buyer Tax Credit
Dear ALTA Grassroots Advocate,
ALTA issued a Grassroots Action Alert last week asking you to write Congress and the President to urge support for a $15,000 unrestricted tax credit. We think the credit would pull a lot of money off the sidelines to work through excess housing inventory, which is an essential first step to broader economic recovery.
We need to make our voice heard, which means that it is in the interest of everyone employed by the title industry to take a couple of minutes to fill out a simple electronic form to communicate with Congress and the President. Please forward it to all of the staff in your office and don’t hesitate to contact me, Justin Ailes at email@example.com or (202) 261-2937 or Alyssa Marois at firstname.lastname@example.org or (202) 261-2935 with any questions.
PEASE SIGN UP HERE…
by on Jun.30, 2009, under Uncategorized
If you’re loosing money due to HVCC, it’s time to get on board with the petition to Reverse HVCC.
Click the link below.
by on Jun.30, 2009, under Article
Alberta remains best place for real estate investors
by The Edmonton Journal
When it comes to the housing market, E-town still rules.
That’s the word from Don Campbell, president of Canada’s Real Estate Investment Network.
The popular author, consultant and public speaker says Edmonton remains the best place on the continent to invest in residential real estate. It’s a claim he first made last August, shortly after oil prices peaked at $147 US a barrel, and Alberta was rolling in energy riches.
Despite a sharp drop-off in oil and gas prices since, and a big slowdown in new oilsands projects, Campbell hasn’t flinched. He insists Edmonton will emerge from the recession stronger than ever.
"According to our research, Edmonton is still the No. 1 place for long-term investing in real estate in North America, absolutely," says Campbell.
"Edmonton has the potential, it has the job growth. We know that when the recovery comes–and it will come, we just don’t know when –Edmonton is going to be able to provide fuel and fertilizer, which is exactly what the world is looking for. So that’s a pretty good basis for job growth."
When Campbell speaks, others tend to listen.
About 800 investors and business owners turned out Friday evening at the Shaw Conference Centre to hear his latest views–and those of several economists–on the housing market and the economy.
by on Jun.29, 2009, under Article
Wow! What a week. We have lost 4 great celebrities this week. Our thoughts and prayers go out to the families and friends.
Ed McMahon, a fixture on U.S. late-night television for 30 years as the full-throated announcer and sidekick for Johnny Carson on NBC’s "The Tonight Show," died on Tuesday at age 86, his spokesman said.
The veteran TV personality, best known for his nightly introduction of Carson in a deep, booming voice with the drawn-out line, "Heeeeeeeeere’s Johnny!" died at a Los Angeles-area hospital, spokesman Howard Bragman said.
"He died early this morning with his wife and loved ones by his side," Bragman said.
Actress Farrah Fawcett, the "Charlie’s Angels" television star whose big smile and feathered blond mane made her one of the reigning sex symbols of the 1970s, died on Thursday after a long battle with cancer. She was 62.
Michael Jackson suffered a cardiac arrest earlier this afternoon at his Holby Hills, California home just after 12:20pm. The 50-year-old Jackson reportedly collapsed at his home and staffers immediately rushed to his aid, but he was unresponsive.
A source tells TMZ that Jackson was dead when EMTs arrived (it took 10 minutes). Paramedics reportedly attended to Jackson, who had no pulse and they never got a pulse back. Paramedics were unable to revive him so they transported him to the hospital (another 10 minutes).
Once at the hospital, the staff tried to resuscitate him again but he was completely unresponsive. He was pronounced dead at 3:15 PDT.
The ‘Thriller’ singer was supposed to embark on a 50-night ‘This Is It’ residency tour at London’s O2 arena next month.
Billy Mays has died. He was 50-years-old. Mays, the television pitchman who rocketed to fame by appearing on commercials and infomercials promoting household products such as OxiClean, Orange Glo and Kaboom!, is dead.
According to FOX news reports Sunday, Mays was found unresponsive by his wife inside his Tampa, Fla., home at approximately 7:45 a.m. on Sunday.
The Tampa Police Department said there were no signs of forced entry to May’s residence and foul play is not being pursued as a cause at this time.