Archive for Short Sales
Be Smart And Start Real Estate Investing
Posted by: | CommentsMany are looking to real estate investing as a part or full time business. Many people think this is a good time to get into the game because there are many foreclosures on the market. Foreclosed homes are those that are owned by the bank or the lender.
The lender takes possession of the property when the borrower cannot make his monthly house payment. The banks then sell the property to those looking for a home to move into, or to real property investors. In most cases investors buy foreclosed properties because people who looking for a home to move into are looking for a house that does not need extensive renovation.
Most foreclosures are sold to investors because the property is usually in need of repair. The foreclosures are in disrepair because the people who were evicted from the home realized that they would have to move out so they allow the house to in essence, fall apart. Some even damage the house on purpose.
Property investors will rehab the home and then place it on the market for sale for a profit or they will rent the house for positive cash flow. People who buy homes that are repossessed by the bank, also called REO properties, or real estate owned, usually work with one or two qualified real estate professionals. Banks do not list their properties with just any agent.
They work with only a handful of agents who understand the REO market and sales procedure. The successful investor finds out the agents who work with REO properties and create business relationships with them so that they can find out of any new properties before they are listed on the MLS. The MLS is the multiple listing service, and is where all houses owned by the banks are listed for sale.
The MLS is the multiple listing service and once a house is placed on the MLS, it will draw a lot of attention and many bids. But an agent does not have to immediately place a home that he has been assigned by the bank, on the MLS. Before he places it on the MLS, he can call the investor he has a business relationship with and offer the investor the chance to bid on the house before anyone else is aware of the property
This is completely legal and within the rules of the real estate profession. The investor who has more friends in the real estate sales industry will be able to find out more good property deals.
If you need more information, you can visit Lisa Udy’s websites at Richmond UT Homes or Hyrum UT Homes.
Real Estate For The Beginner
Posted by: | CommentsHow many times have you turned on your television late at night and been bombarded with the latest real estate program that all but guaranteed you everything you ever wanted. Television, radio, and print alike are each swarming with advertisements created by these self-appointed masters who promise to guide you to wealth beyond your wildest dreams. And certainly it can be done in real estate, yet for the few who succeed there are so many more who fail, and still the late night guys manage to stay in business.
So how then to these men and women continue to pop up night after night? It is because people do succeed. They are the ones shown giving testimonials, but they are average people just like everyone else. They bought the program, implemented it, and made money, and they believe anyone can do it. Unfortunately you are more likely to fail than to succeed.
So what do they have that the rest of the population does not? That can be a difficult question to answer, however in many cases a lack of fear can sum it up. If you don’t have anything, you certainly don’t have anything to lose. If you are at rock-bottom and the only way to go is up you might be more open to taking risks, and in real estate, very little is accomplished without risk.
Sure, you could become a landlord. You could collect rent and make enough to live off of at the very least. Then again, You might only make enough to squeak by, spending most of your “profits” on things like maintenance, improvements, taxes, lawyers and legal documents, and even landscaping. The expenses are tremendous. If you can do most or all of the work for yourself, or even if you want to do it yourself, you have an advantage, but it does not come easy.
Foreclosures offer another real opportunity, however properties are sold on as “as is” basis, and this means there is quite often serious and sometimes expensive repairs that must be done before the property can be sold. Being a contractor or having those kids of skills can be a real money saver with REO properties, as well as a solid understanding of the market.
Still another way to get in to the game is by becoming a part of an investment group. This is a great way to make money, although you will make less due to the spreading of profits, however the risk is spread out as well. This might be a good way to go for the beginner who has a bit of spendable cash available.
So the late night guy or gal on television isn’t exactly misrepresenting the truth. Sill, they don’t usually focus on the risk and the hard work involved in making money through real estate. It can be done though, if you have the stomach for it.
Increase your knowledge from the expert Lisa Udy by checking out her website and visit Hyde Park UT Homes or Providence UT Homes
Ten Keys To Getting A Short Sale Approved
Posted by: | CommentsShort sale gurus say a lot of wild things sometimes, but some of their methods they use to get their short sales approved are really nuts. I hear about secret spreadsheets, magic phrases to speed up the approvals, and inside contacts who guarantee to put your files on the fast track. Most of it is just ridiculous.
After surviving hundreds of short sale negotiations, my colleagues and I have found that there are several components to getting a short sale approved – and none of them involve immediate acceptance. It’s about knowing what challenges to expect and implementing a few strategies to make it easier to meet them.
If you want to be successful at negotiating short sales, it’s really all about understanding what lenders are thinking during those negotiations. They’re thinking about which course of action will cost them the least amount of money. If they see any way to collect that debt, they will do it. If they see any need to avoid a long-term bad debt, they will generally move in that direction. Lenders know how much it costs to continue to collect debts and maintain REOs. They know exactly how much money they lose when they have to take possession of a foreclosed property.
So, without offering any wacky secrets, these are my real-life, straightforward tips for successfully negotiating a short sale.
1) After you submit a complete short sale package, confirm that it was assigned to one of the loss mitigators and find out who that is. Do this right away, because it’s not unusual to find that lenders misplace those packages upon receipt. They are overwhelmed with foreclosure paperwork, so a call or two from you may help your package avoid getting lost in the shuffle.
2) Be persistent. Lenders are swamped with foreclosures. They have trouble keeping up with all the short sale cases they are working. The only way to push things forward is to make sure you are pleasantly persistent. Don’t call every day. Call every other day or every third day. When you call, don’t leave a message every single time and make your first impression as a pest. Just hang up and call back.
3) When you find out who is handling your short sale package, ask them who owns the loan. I guarantee this will make your negotiations go more smoothly. Once you know whether the loan is a VA, FHA, Fannie, or Freddie loan, you can know exactly what their negotiation limits are.
4) Summarize your offer for the loss mitigator and ask them to get an interior appraisal or BPO as soon as possible.
5) Conduct an effective BPO.
6) Pull a title report after the BPO is done so you can resolve any outstanding issues before the closing.
7) Ask the bank about the number for the BPO. This is self-explanatory. Just ask. Sometimes they won’t tell you, but sometimes they will. And then you know you’ll pay about 90 percent of that number.
If the lender refuses to disclose the BPO, you need to ask for a counteroffer. (When they make their counteroffer, this is usually equal to the amount of the BPO anyway.)
9) Submit your own counteroffers with additional proof to validate your offer (days on market from the MLS listing, repair estimates, low comps, negative articles on the area or city).
10) Make sure the lender knows you’re a cash buyer and can close quickly.
We’re not selling any magic potions, and we’re not selling any hyped-up baloney. The truth is much more powerful. Lenders don’t normally view short sales as their best option, but short sales aren’t their worst option either. All you have to do is convince the loss mitigator that your solution makes the best financial sense for them. If you’re ready to educate yourself, develop a good attitude, and be persistent, you can successfully negotiate a short sale.
Want to learn more about managing a short sale negotiation? Check out the Strategic Real Estate Coach website and gain access to everything you need to know about loss mitigation in America!
Foreclosure Options For Homeowners
Posted by: | CommentsLosing your house is an unbelievably stressful experience. The money won’t cover the bills, the creditors won’t stop calling, the family won’t stop arguing about who’s to blame, and you have enough to worry about without having to arrange for somewhere else to live. You wish you could snap your fingers and make it all go away.
If you know someone who has been through foreclosure, you might already know what could happen. Did you know there are several options available when you get a notice of default? It might seem easier to just move out, but you have to think about your financial future. For instance, when you move out, will you be losing your ability to ever own another home?
Whether you’re a homeowner, a real estate agent, or an investor, you need to know all the options for someone facing foreclosure. As a homeowner, your best bet is to get enough information to make an informed decision. As someone who helps homeowners, you need to make sure they understand that information. You need to set realistic expectations for the loss of their home.
Let’s look at the deed-in-lieu option and loan modifications first.
A deed-in-lieu means that the homeowner agrees to simply hand over the property to the bank. It helps the bank make the repossession easier, but it still hurts the homeowner’s credit as if the foreclosure had actually taken place.
Are mortgage loan modifications the answer? We have all heard about the Home Affordable Modification Program (HAMP) initiated by the government to make more loan modifications a reality for homeowners in default. Unfortunately, only 4 percent of all homeowners that apply for modification actually result in their loan’s permanent modification. For instance, in one recent quarter, California had about 140,000 mortgage loans begin the trial modification process. Based on the current success rate, only 5,600 of those loans will actually be modified to avoid foreclosure. At that rate, modification programs are simply not helping enough people.
There are four more successful options.
1) The homeowner can stay in the house and file for bankruptcy, allowing the courts to stall the foreclosure as long as possible. It doesn’t mean the foreclosure won’t happen, but it does mean that the homeowner can refuse to pay for a place to live until the auction date.
2) The real estate agent can list the property for the amount due on the mortgage and try to convince the buyer that the house is worth it before the foreclosure auction date arrives. Since most buyers wouldn’t fall for that, the homeowner may choose to revert to the first option.
3) List the house as a short sale, find a buyer, and make the buyer wait out the short sale process in order to buy the house at a discount. Many real estate agents recommend this solution because it sounds like the easiest thing to do while still earning their commission, but it’s a little more complicated than that.
For instance, the buyer usually has to agree to wait two or three months before they can close on the house and move in. Most buyers need to purchase a property that is ready to close in less than a month.
If the real estate agent or the seller isn’t familiar with negotiating a short sale, other problems can arise during the negotiation process. Banks have entire loss mitigation departments staffed with people who are trained in collecting mortgage debt, and they have no problem taking advantage of homeowners who don’t understand the system.
I’ll give you an example. Did you know that deficiency judgments and post-sale promissory notes can be avoided in some cases? You can know the basics of how the process is supposed to work, but shouldn’t you learn how to work the process? Wouldn’t that alone be worth it?
4) The real estate agent could list the house as a short sale, while arranging the purchase by a short sale investor who doesn’t mind handling the paperwork, negotiating a successful short sale on the seller’s behalf, and waiting for the lender’s approval before closing on the house. The homeowner would avoid a foreclosure, the agent would still get the commission, and the buyer would get the home as an investment property to sell or rent.
Why should the homeowner work with an independent short sale investor? People who negotiate short sales every day know the best ways to get the best deal for the homeowner. For instance, the BPO process is more than just having an appraiser stop by. An experienced investor will know how to handle the situation to the homeowner’s benefit.
The four main options for homeowners in default should be made evident to everyone involved. They can stay in the home and use the bankruptcy process, they can sell the home for what they owe the bank, they can ask a potential buyer to wait out the short sale negotiation process, or they can outsource the negotiations to a short sale investor who will buy the house from them.
If you’re interested in finding out how the short sale approval process really works, sign up for free downloadable reports on the Silver Membership page of the Strategic Real Estate Coach website. You’ll also learn about the foreclosure process, and you can gain access to networking opportunities with other people who are interested in helping homeowners avoid foreclosure.
Attorney Jeff Watson has some great commentary on the legal side of real estate investing. You can find that and more on his blog. Just visit topshortsalelawyer.com.
When you help people learn the truth about foreclosure and how to avoid it, you give them a chance to overcome one of the most difficult times in their lives. Educate each homeowner about their options, and watch them turn a bad situation into a fresh start.
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Some Advice On How To Avoid Foreclosure
Posted by: | CommentsEspecially in today’s economy, thousands of people are struggling to pay the bills. This, unfortunately, includes dealing with the threat of foreclosure on their homes. It is possible; however, to avoid foreclosure. Follow these few guidelines to avoid having your home taken away from you.
The very first thing you should do, when you run into trouble, is call your mortgage company. You will need to, specifically, talk to someone in their Loss Mitigation department. Explain your personal and financial situation to them. Plan to divulge information you may not want to share, and be ready to give them proof.
Mortgage companies are prepared to deal with many different financial hardship situations. Depending on your specific situation there are several different options that the mortgage company can take with you. One of the most common is known as forbearance. This action allows you to repay missed payments.
Other approaches are available. Mortgage companies may give you another loan for the late amount, add the late amount onto the end of the mortgage, or even consider waiving a payment. All of which are fully dependent upon your exact situation.
You may not have even considered this, but some people leave their home as soon as they think they will lose it. This; however, will put you in a place where you can no longer be assisted. There are counseling agencies, in your area, designed for helping with these particular cases. They are more than willing to help, providing you still reside at the property. Take all the help you can get.
If your mortgage company has already formed a Notice of Default, your options have just lessened. At this point you will have a much more difficult time getting assistance from anyone, including your mortgage company. One of the only options you have, if you want to save your credit, is to sell your house. Problem is, you might not get enough money and you still have to pay off the remainder of the loan. On the other hand, a few grand is way less than a house.
There are a couple other options, at this point, but they will you’re your credit almost as bad as the foreclosure would. Just keep in mind that you have options. Acting before things get out of hand is your best option and will be the one that works for you. Do not let things get to the point that there is no return. If you want to avoid foreclosure, work with your mortgage company immediately.
Learn how to avoid foreclosure by using short sales. Head online today and you can learn how a short sale will help you out.