Is your Short Sale going well?

How do you know if your Short Sale is going well? This is a hard question. Especially since the process can be long, repetitive and frustrating even when it is going smoothly! Here are a few tips of what I have found to be the "norm" in the process.

1.) Pricing the home the 30 day price: Each mortgage company has a different attitude towards the price that the home should be listed for. Some have the attitude that the home needs to be listed for what is owed for a specific time period (30-90 days) before the price is lowered. I have found that marketing the home at a realistic discounted priced based on local REO sales has been my best bet. If your REALTOR does not know what a BPO is, you seriously need to question their ability to price your home well.

2.) The contract: Your short sale cannot begin until a contract for purchase is on the table. In short if you do not have a deal, you cannot short sale. A contract needs to be obtained ASAP to start the process. Some lenders will begin the paperwork without a contract, but most will not take the offer seriously until a buyer is ready to move on the property.

3.) The waiting game: Short Sales can take several months. Usually you will not have news for weeks at at time. Your REALTOR needs to call and monitor the transaction closely. If they are waiting for the mortgage company to call them with updates, your file may not be getting the attention it deserves.

4.) Foreclosure Notices: Most Short Sales can delay foreclosures. Have your REALTOR call the mortgage company and the attorney to request a delay in foreclosure to allow for more time for the contract to be worked out.

5.) Have a plan B: You are Short Selling your home. You should be looking for a rental or other living arrangements. Make sure you are ready to move so that you are not caught off guard when the transaction is ready to settle.

6.) What's your Record? Always ask how many Short Sales they have completed and what is their success rate. If they don't have a good answer or they tell you its hit or miss, Call another REALTOR.

7.) Don't wait until its too late!!! If you have a foreclosure date set or have not made a payment in 3-4 months you are at risk and even a great REALTOR may not have enough time to save your home.

For more information visit www.equitynegotiations.com, we specialized in Short Sales and are ready to help you sell your home!!!

At the End of the Day . .

One of the most commonly used phrases in our office is "At the End of the Day . . ." which is usually used to summarize a reality check for the issue at hand. Almost every person I know is pinching pennies to get by. Whether it is the average family cutting back on their annual summer vacation, or the single person who is seeking out cheap entertainment with friends, we all are not living the lifestyle we were living a few years ago.
Working in real estate I have seen the ugly side of this recession: divorce, foreclosures, bankruptcies, abandoned pets, molded homes. Dealing with the realities of what is going on can easily make a person question how everything came unhinged so quickly. There is a positive side to this recession too: Home values are down to where families can actually afford to purchase a nice home at a reasonable price, and the credit crunch is teaching us all how to live financially responsibly ( whether we want to or not).

Here is my top 8 "At the End of the Day . ." tips for homeowners and REALTORS

1.) KNOW what you want: Take the time and effort to figure out what you want out of your home purchasing and selling experience. Make a list of your goals, a loose time line and interview agents until you find one that "clicks" with your vision.

2.) BE REALISTIC: All the upgrades in the world do not matter right now! The bottom line is price. Your home must be priced well to sell!

3.) STOP watching HG TV! ( Just Kidding) You can watch, but again make sure that your expectations are realistic. The majority of their programs are filmed in CA, or suburbs of large cities. Be familiar with your market, and which homes are selling.

4.) BEWARE of Open Houses: The time and energy you spend baking cookies, and the cash you dump into a newspaper ad, may be better spent on effective Internet marketing OR cleaning stained carpets ( painting a neutral color) . If your home is not a showcase, and it is not priced aggressively, you will be disappointed with the results of an open house.

5.)SHOP your Mortgage!: I do not care if your loan officer is your Grandmother! Make sure that you are not being charged an arm and a leg in closing fees. Always ask for a Good Faith, and Always get a second opinion.

6.) HOME INSPECTION: A good home inspection can make or break a deal. Vacant properties can have underlying issues. Encourage an inspection for informational purposes and find an inspector you trust.

7.) BE a Conductor: A good REALTOR needs to stay on top of the entire transaction, and encourage good communication with their clients. This is hard on both parties, but the effort must be there, so make yourself available but also remember to set some boundaries.

8.) DON'T BE the Problem: If you have a buyer that wants to buy and a seller that wants to sell, make sure that you are not getting in the way of making that happen. Sometimes, lending, pricing, and commissions will need to make a deal happen. Be flexible and ready to think outside of the box.

We have more ways than ever to get a real estate transaction completed. For more tips and options visit my site www.equitynegotiations.com, to search for homes, get information and even find out how much your neighbor's house SOLD for!!

Common Short Sale Myths!

One of the most difficult conversations I have with potential clients is where I discuss what the current market value is of their homes. Most homeowners have attached feelings of pride and sentiment into their homes, especially if they had worked hard to maintain and improve the property.

In our area( Northern Virginia) property values have dropped around 35% since 2005 and we have not hit the bottom yet. I know many other local markets are very similar, and other REALTORS have been saddled with the responsibility of helping many homeowners have a harsh reality check. The equity that homeowners were counting on to shore up their financial future has evaporated. Will it return? Yes, with time I think that things will even out, but for homeowners that are now $70,000.00+ upside down on their homes, the recovery may not happen before they need to move.

Many homeowners are unaware that they can sell and avoid foreclosure through a Short Sale. A Short Sale works similarly to a regular real estate transaction, but the realtor negotiates their commission and the sales price with the lender that holds the homeowners mortgage. Often short sales will take several months to complete, but the outcome can save all involved parties a great deal of stress and money.

Myth #1: A Short Sale will have the same affect on my credit as a foreclosure SO why should I bother? First a Short Sale will always look better to future creditors because it shows your willingness to cooperate and that you just did not abandon the property. Different mortgage companies are reporting short sales differently on credit reports, points may drop anywhere from 0-200, it may look like a credit charge off, and short sales typically only stay on a credit report 4-6 years as opposed to the 7-10 a foreclosure remains on your credit.

Myth#2: I need to hire an attorney to perform a short sale and I cannot afford it! Not necessarily! An experienced REALTOR who is familiar with negotiating short sales will be able to complete the task AND negotiate their commission. Of course REALTORS always recommend legal and tax advisers, but you should not have to pay anyone for a Short Sale.

Myth#3: My home needs to many repairs I cannot sell it now! Your home can be marketed to be "SOLD AS IS" meaning you disclose that the home will not have any repairs made and the sales price should reflect that. The only thing that you may still have to pay for on your home is utilities to make sure that no further damage happens to the home while it is vacant. This too can sometimes be helped if the home is secured properly by a professional and utilities can be turned off to save money.

Myth # 4: I have a foreclosure date scheduled its way to too late to try and save my home from foreclosure! Once a date is set the chances of pulling it off the court house steps are less than 5%, but recently we have had success with certain mortgage companies in delaying foreclosures to market homes for sale. An experienced REALTOR will be able to help evaluate your situation and help determine if foreclosure prevention is a possibility.


Sometimes it just does not make good financial sense to modify your loan to keep your home. If you have had a permanent change in income, your home needs numerous repairs, and if you are $70,000.00+ upside down on your mortgage, even a modified mortgage may not help you turn around your finances for the good. If you have to put more money in to an investment, that is already worth less than what you owe on it, you may just be flushing your dollars down the drain. Our economy and our real estate markets have created many financial pitfalls for current homeowners, but you do have options outside of traditional real estate practices. Please visit my website www.equitynegotiations.com for more information on short sales and the options that are available to homeowners who are experiencing financial difficulties.

Use your $8,000.00

May 29th U.S. Housing and Urban Development Secretary (HUD) Shaun Donovan announced that the $8,000 tax credit offered through the American Recovery and Reinvestment Act of 2009 can now be used towards the 3.5% down payment OR closing costs for FHA loans! The tax credit currently only could be accessed after the purchase of the home, but this new revision will allow first time home buyers to immediately put their credit to work towards the purchase of the home. This new found flexibility will open up doors for even more first time home buyers who were striving to save the inital 3.5% down payment and additional closing costs.

Currently the FHA allows parents, employers and other government entities to contribute towards the down payment, but now with the the credit potential home buyers will have yet another source to bridge the initial expenses to purchase a home.

I know I'm not the first, but the more REALTORS that write about it, the further this great news will travel! Please visit www.hud.gov/news/release for more information. Sing it from the roof tops! We can make this market great with good deals and better mortgage products!

I cannot pay one more bill!!!

Managing your monthly bills can become more of a challenge if your income has changed significantly in the recent recession. Items that you once did not give a second thought to paying, (Premium cable channels anyone?) are now on the chopping block to make room for the truly necessary utilities. It's hard to look at your budget and your lifestyle to figure out where excess ends and frugality begins. The other difficult part is coming to terms with loosing the real estate "Flare" that we all have come to know and love. I'm a techie so I enjoy my electronic forms, cool website tools, upgraded tours etc., but the reality of it is, what is my true return of investment on all of these extras? Looking at my stats, I have found more success in real estate my first few years than some veterans have had of late, BUT at what cost??

I have read numerous books, and other blogs about saving money and changing your financial future for the better, and the common theme amongst them all: Life will continue on with out your morning commuter coffee! First, we all really need to shake of the "recession funk". Yes things are slow, money is tight, and real estate deals are more difficult to close. I also feel that with my clients, we are taking a harder look at their current income an expenses, before I show them homes. I know how quickly a mortgage can be derailed if money is already tight. Those two points being made, here are my thoughts about things that we can do create a little wiggle room in our personal and business budgets.



Personal



1.) 5,7,9: Those are the three channels I get for FREE with my digital converter box. Now sometimes the channels are a little fuzzy, but the audio is just fine.

2.) Dropping Internet service: WHAT??? How can you do business!! I have the data plan on my smart phone, so I can get online for email, home searches etc. Why pay twice? Besides when your are home you need to spend time with your family, not more time with your computer.

3.) Buying fast food at the grocery store: All the things that you love to stop and get on your way to work, are usually in some shape or form at the store. You do not have to deny yourself a good cup of coffee if you really enjoy it, BUT it is much cheaper if you make it yourself in the morning, while you nuke a frozen breakfast sandwich. Save gas and money and try to recreate the things your love to stop for at home. Plan ahead and get a decent insulated lunch box that you will enjoy using.

4.) Coupons, Coupons, and more Coupons! Yes they are a pain, but you really can save money if you combine them together and your store card benefits. Just the other day between coupons and store incentives I had $12.00 of free products in my cart from my favorite local drug store. Also buy food at the grocery store, cleaning and paper products at the dollar store, and beauty products at the drug store. I know that its great to throw everything in the cart at once, but you will be SURPRISED how much you save but stocking up by category.

5.)Dark and Cold: Cut down on your energy bills by using natural light, and washing everything in cold water. Now that its spring I have put up a clothes line to save more energy and wear and tear on my dryer.

6.) Thrift Store: Not only will you supporting a good cause, but you can find great deals on wardrobe basics at the good will or salvation army.



Business:

1.) Back to basics: Make sure that you evaluate every extra business expense that you have and what return it offers you. If you are using it just because it is "fun" or "easy" then cut it out and save your cash.

2.) Trustworthy Vendors: Time is money. Your team of home inspectors, handymen, lawn care crews, pest inspectors need to be efficient and affordable. Don't be afraid to compare prices and don't settle for slow or under par service. Deals can fall apart in an instant and you need to have a qualified support team to help avoid sudden pitfalls.

3.) Quality Equipment: I love new gadgets more than the next person, but you need to look at the full picture of the maintenance and cost of accessories for that new tool. Research everything BEFORE you purchase and remember that paying a little more up front for a well reviewed product may save you from going to cheap and not getting the results you are looking for.

4.) Continuing Education: Often it is more expensive to go sit in a class room, than to take the courses online. Compare costs and different sites, you may be surprised of how much money you can save to get the same certificate.

5.) Get a great accountant: Know what you can write off and what you cannot write off and make sure that your records are accurate. Two things in life are certain: Death and Taxes ( or so I've been told) So make sure you have someone you trust when it comes time to stroke Mr. Obama a check.

These tips are mostly common sense, but I hope that other REALTORS and even those just looking for budget tips on the web find them to be helpful in shaking off their own budget woes. I already think things are starting to turn around, and I hope that this market has taught us all the important financial lessons we will ever care to learn! Good luck!

Loan Modifications: The Facts!

Is this best for my family?

1.) To qualify for a loan modification you will need to show a hardship in your income. Hardships include: Job loss, wage/ hour reductions, extensive medical bills, divorce, and death.

2.) The income that you do have will need to be able to sustain a modified payment. Lets face it, the banks are willing to work with you BUT they are not going to let you live in your home for free.

3.) Modifications are wide spread, most are customized for the individual and their situation. If your income change is temporary, your lender may offer you a repayment program. Interest rates, principle reductions, special arms, are all possibilities that lenders are exploring

4.) You can negotiate this yourself: Most lenders have their contact information online, or available to you by a mailing packet you can request. Most of our clients come to us because they have difficulty reaching their lender, collecting the necessary paperwork, or are unsure of how the process works and would like assistance with the entire process from start to finish. Often our staff can easily have 10+ hours of phone hold time just trying to get the correct information to the lenders to start the process!!

5.) I'm still not sure: If you have questions about loan modifications, please feel free to call our help line at 540-450-8705 to speak with our staff. Or send us an email: info@equitynegotiations.com

Documenting Lender Calls

Do you know what you want? Make sure that you are expressing this to the lender rep that you are calling. What is the end goal? To sell the house! Each call you make needs to have a clear direction and purpose. Remember that there are several steps to completing the sale. Each call you make should take you a little closer to your mile stones.
You will need to create a log for each transaction. Each time you dial the lender, you will need to identify yourself, and you will need to document the employee's name and identification number. This will help you maintain control in the conversation and give you a way to track information as it is recorded. Your log will serve as a reference for future calls, and help you keep track of the progress you are making on the file.
Each task the lender will ask you to accomplish will need to be completed quickly and efficiently. Do not forget that in all short sale transactions you are working against the calendar. BONUS:If the person you are speaking with does not have a good attitude, OR they seem like they could care less. Wait a hour and try again. You may reach someone who can give you the answers you are looking for.