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Posts Tagged ‘Short Sales in Boise ID’

Short sale vs Foreclosure..What do I do?

Tuesday, April 27th, 2010

I have had several people stop me and say ” is it worth it to do a short sale or should we just walk away, not deal with the hassle of a short sale and hand the keys back to the bank?” This is something only  you and your family can answer, but before you make that decision, lets look at some things I understand to be some key factors.

Short Sale Benefits

Here are a few benefits for doing a short sale that may not have occurred to you:

  • You are in control of the sale, not the bank.
  • You may sleep better at night knowing who is buying your home.
  • You will spare yourself the social stigma of the “F” word, foreclosure.
  • Contrary to popular belief, you can be current on your payments and still effect a short sale.
  • Your home sale will be handled like any other home sale.

Buying Again After a Short Sale

If your payments have never fallen behind 30 days late and the lender does not require that you pay back the loan, Fannie Mae guidelines may allow you to buy another home immediately. The wait for an FHA loan is 3 years.If your payments are in arrears yet a short sale is granted by your lender, you may qualify to buy another home with a Fannie-Mae backed mortgage within two years, regardless of whether the home is your primary residence.

Buying Again After a Foreclosure

With certain restrictions, you may be eligible to buy another home in 5 years if the home was your primary residence. Without restrictions, the wait is 7 years.If you are an investor and do not occupy the home, the wait to buy with a Fannie Mae insured loan is 7 years.

Affects on Credit After a Short Sale

A short sale is not a derogatory mark on your credit because credit bureaus do not show the word “short sale” on your credit report. It may say “pay as agreed” or “paid as less than agreed,” among other categories. Some clients have reported negative FICO score drops from 50 points to 130 points.The point drop is typically due to being in default, that is behind on your payments.

Affects on Credit After a Foreclosure

A number of sources have reported FICO score drops from 200 to 400 points after a foreclosure. Generally this credit score will remain on your credit report as a public record for 10 years.

Credit Reports After a Short Sale

All lenders report short sales differently and some do not report them to the credit bureaus at all.

Credit Reports After a Foreclosure

If a prospective employer runs a credit check on you, your job application may be denied if you have a foreclosure on your record.

Deficiency Judgments After a Short Sale

Judgments are often negotiated between the seller and the short sale bank. In some cases, in many states, if the home is your personal residence and was financed through purchase money, there is no deficiency judgment.

Deficiency Judgments After a Foreclosure

Banks are unwilling to negotiate deficiency judgments with the homeowner after a foreclosure, in many states.. 

Loan Application Questions After a Short Sale

Loan applications do not ask questions about a short sale. You may report that you sold your home.

Loan Application Questions After a Foreclosure

You are required to answer the question: “Have you ever had a property foreclosed upon or given a deed-in-lieu thereof in the past 7 years.” If the bank sees you have had a foreclosure, your loan most likely will be denied. If you lie, you may be subject to investigation by the FBI for mortgage fraud.

Length of Time to Move After a Short Sale

If you’ve had a foreclosure notice filed, you may be able to postpone that action while the bank considers your short sale. The wait for short sale approval can be from 2 to 3 months, or LONGER.

Length of Time to Move After a Foreclosure

Unless prior arrangements have been made, the bank may want you to immediately vacate the property and can commence eviction proceedings.

Taxation After a Short Sale

A personal residence is exempt from mortgage debt relief until the end of 2012 on a federal level. Some states will still tax you unless you qualify for an exemption. An investor is not exempt from mortgage debt relief, subject to certain conditions.

Taxation After a Foreclosure

Same as with a short sale. Except some lenders immediately send out 1099s, even if the owner is exempt. With all of this being said, Sellers and buyers MUST realize, hold on you in for a ride……

In closing, always obtain legal and tax advice before making a decision between a short sale or a foreclosure…. visit our website at www.theeliteteam.net for shortsale and foreclosure listing, or call us at 2087131123 Lori

 

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Posted in Foreclosures, Short Sales | No Comments »

Buying Real Estate in your IRA’s

Thursday, January 14th, 2010
    Over the last two years economists, politicians and prognosticators have proclaimed our current state of affairs as ‘The Great Recession’.  According to the Department of Labor at the start of the recession in December of 2007 we had an unemployment rate of 5% and approximately 7.7 million Americans out of work.  In December of 2009 the unemployment rate was 10% and the number of unemployed was 15.3 million Americans. 

Flash back to October of 2007.  Real Estate was booming as owners borrowed from their homes with HELOCs and the DOW closed at its all time high at over 14,000 points.  Then the trouble started with the failure of Bear Stearn’s and Lehman Brothers bankruptcy.  Between the stock market peak in October and it’s low in March of 2009 the stock market dropped over 50%.  Over 3 trillion dollars in net worth was lost my Americans.

Americans now more than ever are taking charge of their own future and managing their own retirement accounts.  With the challenging times we face investing in solid inflation fighting real estate investments are a good alternative to traditional investing.  With the value of future retirement accounts greatly diminished it is time to grow the ‘nest egg’ by utilizing all the potential tax strategies and tactics available to us.

As an investor it is important to realize that you can make decisions in your IRA or 401 K plan yourself.  While the stock market is confusing for many the idea of purchasing a rental property in your retirement account makes great sense.  Cash flow in addition to  property appreciation can make for a very good avenue of diversification to the tumultuous stock market.   A purchase and sell in your IRA or 401 k is tax deferred allowing you to increase the value of your portfolio without triggering tax consequences.  You can also get a real estate investment loan in your IRA or 401 k giving you the ability to leverage more real estate. 

As always before making a move to manage your own IRA you should consult your professional accountant, tax attorney, and realtor.  If you are interested in more information on purchasing real estate in your retirement account please contact Shelli Cracchiolo at 209-941-5177, or Lori Bilyeu at 208-713-1123 or visit our website at www.theeliteteam.net .

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Short Sale Negotiations

Wednesday, January 13th, 2010

Short Sale Negotiations

The sellers can agree to any type of purchase offer put before them for signature, but it’s not binding unless the sellers’ bank approves the offer. It doesn’t matter what stipulations are in the offer if the bank won’t accept them. Your true negotiation does not lie with the seller; it lies with the bank’s negotiator.

Banks rely on desktop appraisals and third-party BPOs (broker price opinions) to determine value. Although banks don’t want to follow through on a foreclosure, they also want fair market value. It is up to the listing agent to provide comparable sales and to substantiate the price submitted by the buyer. Call Me at 208-713-1123,208-941-5177, or visit our website at WWW.theeliteteam.net for further assistance.

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Short sales on the rise

Thursday, January 7th, 2010

Sales have been picking up steam since April, and, in July they increased year-over-year for the first time since November 2005. The increase was driven by first-time buyers seeking to capture the $8,000 tax credit and by bargain hunters and investors lured by discounts of 15% to 20% from market value on foreclosed homes and short sales (properties sold for less than what was owed on the mortgage). Federal intervention in the credit markets helped shore up mortgage lending at super-low rates.

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November Homes sales leap

Monday, December 28th, 2009

After surging 10% in October, sales of existing homes jumped again in November, growing 7.4% compared with October to an annualized rate of 6.54 million units, according to the National Association of Realtors.

“This clearly is a rush of first-time buyers not wanting to miss out on the tax credit,” said NAR’s chief economist, Lawrence Yun.

November was originally going to be the last month in which sales to first-time homebuyers would qualify for a federal tax credit of up to $8,000. However, that deadline was extended and expanded, and buyers now have through June to purchase homes.

The strength of sales in November surprised the industry. A panel of experts compiled by Briefing.com had forecast month-over-month sales growth of just 2.5% to 6.25 million from 6.1 million a month earlier.

The sales total was a also huge improvement over a year ago. Sales rose 45.7% over the paltry annualized rate of 4.49 million units during November 2008.

The contribution made by first-time buyers is evident in a separate survey NAR conducted of its members. They estimate that 51% of sales in November were by newcomers to the market, up a point from 50% in October. Normally, first timers account for about 40% of sales.

Also propelling sales higher were rock-bottom interest rates. The average for a 30-year, fixed-rate loan during the month was just 4.88%, down from 4.95% in October and 6.09% a year ago.

With rates that much lower, homebuyers can save more than $150 a month on a $200,000 mortgage.

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A must see! Short Sale tips for individual Banks

Monday, December 14th, 2009
INDIVIDUAL BANK SHORT SALE TIPS

 I thought it might be beneficial to exchange tips/procedures on short sale procedures by the various banks. Things we find out along the way. I might start off with three: 
(1) Most short sales requests are now required by the government for the bank to analyize it first for a loan modification which means a package does not automatically go to loss mitigation. CHASE requires you to verbally submit the financial information over the phone (in addition to the written financial statement in your package) BEFORE it gets switched over to loss mitigation. No one at Chase told us this for 5 weeks and 7 phone calls.
(2)  National City (PNC) also wants the Seller to verbally contact them and request a short sale before it will go to loss mitigation.  Natioanl City is now out 12 weeks minimum from entry into the loss mtigation department.

(3)Also the last two short sales I have done, if there is a HELOC( Home Equity line of credit) National City and Greentree  now want a 10% payoff from the first to release the lien but  they will not forgive the balance. Hope this helps you. Please pass on your individual bank stories.

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Posted in Homes for Sale, Housing Market, Real Estate, Relocation, Short Sales | 1 Comment »

Guidelines Aim to Ease Short Sales

Thursday, December 3rd, 2009

The Obama administration laid out final guidelines on Monday that should make it easier for some financially troubled borrowers to sell their homes. 

The guidelines are designed to encourage the use of short sales, transactions in which the borrower with lender approval sells the home for less than what is owed on the loan. The program also makes it easier for borrowers to voluntarily transfer ownership of properties through a “deed in lieu of foreclosure.”

 Short sales can result in higher prices than foreclosures and can be less damaging to local neighborhoods, in part because homes aren’t left vacant and exposed to vandalism. But there transactions are often difficult to complete.

 Under the new plan borrows will receive $1,500.00 from the government if the sell their homes for less than the amount of their mortgages. The program is open to borrowers who may be eligible for the government’s loan-modification program, but don’t end up qualifying, or are delinquent on their modification, or request a short sale or deed-in-lieu transaction.

The short-sale program is the latest addition to the Obama administration’s $75 billion foreclosure-prevention plan, which includes incentives for mortgage companies and investors to re-work troubled loans. The government first said in May that it would include short sales in the program, but it has taken months to finalize the details.  Under the new guidelines, second-mortgage holders can receive up to $3000.00 of the sales proceeds in exchange for releasing their liens. Investors who hold the first mortgages, meanwhile, can collect up to $1000.00 from the government for allowing such payments.

Borrowers who complete a short sale under the program must be”fully released” from future liability for the debt, according to the quidelines.

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Posted in Buy a House, Foreclosures, Housing Market, Mortgages, Questions and Answers, Real Estate, Short Sales | No Comments »

Short sale information: What every seller needs to know.

Wednesday, November 25th, 2009

Short sale information needed from Sellers:  

1.Loan information release form: this form is signed by the seller of the property allowing the real estate agent authorization to receive information about the loan made to the seller.

2.Purchase and sales agreement: The purchase and sales agreement are the terms and conditions that a buyer has agreed to purchase the subject property for less than is owed by the seller. The purchase and sales agreement should stipulate that it is subject to “third Party” approval.

3. Hardship letter: The Sellers’ lender will require a hardship letter that explains in detail why the seller is unable to make the payments on the subject property. As much detail as possible explaining the “hardship” is preferable.  All information is private and must be quarded by the real estate professional and lender.

4.Loan approval for Buyer:  The sellers lender will require verification that the purchaser of the sellers “short sale” has unconditional loan approval. The short sale sellers’ lender wants the highest certainty that the subject property will close,

5.Most recent W-2 for seller: Part of the seller’s lender package is request for financial information. That can include tax information and pay stubs. If seller is an independent business person financials and profit loss statements may be required.

6.Bank statements: Sellers’s short sale lender will typically request copies of the sellers’ bank statements for the last 2 months. The lender wants to see shat accounts and reserves are available for the seller.

7. Listing agreement: The listing agreement between the seller and the real estate company is required by the seller’s lender. This demonstrates to the sellers’ lender that the property has been marketed for a certain marketing period.

8.Estimated proceeds and expenses: The seller’s Lender will require an estimated HUD closing statement. The estimated HUD (Housing and Urban Development)closing statement includes  the fees that the seller’s lender will pany and any proceeds allowable to any other lien holders behind the seller’s first lender. Any taxes, home owner’s fees, or expenses will be sent to the sellers’ lender for approval.

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Posted in Homes for Sale, Housing Market, MLS, Property, Real Estate Agent, Short Sales | 1 Comment »

A Brief Introduction to Short Sales in Boise, ID

Thursday, November 19th, 2009

All year long we’ve been hearing about how difficult the economic climate is around the country. These economic hard times have become almost intertwined with difficult times in the Real Estate Market. Because of this current state of the economy, many people are now finding it hard to keep up with their mortgage payments, and in Boise, it is no different than any other part of the country. Many are finding it hard to make ends meet.

So as times get harder, instead of losing their homes or ruining their credit, may people opt to sell their home for less than what they owe on the existing mortgage. If they can get the approval of the bank or mortgage company, they will sell their home for less than what they owe on it and save themselves from having their home foreclosed and their credit taking a heavy hit. When a home is sold this way, it is called a short sale because the sale fell short of the balance of the mortgage owed.

Short sales can be found all over the country so whether you live in Boise or Kansas City, you can find one if you are searching for one in your area. Many bargains can be found in the country today if you are looking to buy a home. Look around, check out the real estate ads, call your local banks, and check out the classifieds. You will find a home to fit your family’s needs.

We have a significant amount of experience in working with short sales, so feel free to contact us with any further questions you have!

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Posted in Short Sales | 3 Comments »

Market Recap

  • Avg. Sales Price: 240,000.00

  • Avg. Days on Market: 120

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