San Diego short sale specialist

According to’s April Local Market Index, 46% of the top U.S. markets have achieved full pricing recovery.  This would seem to indicate that short sales caused by negative equity are on the down-turn.  However, there are some new factors that might contribute to a large increase in the numbers of homeowners seeking short sales.

Between 2005 and 2008 RealtyTrac has estimated that there were 3,262,036 HELOCs originated with an estimated balance of $158 billion that are still open loans.  Those equity lines are set to re-set between 2015 and 2018, many on properties that are still underwater.  The problem however isn’t just possible negative equity; it’s dealing with potentially higher payments.

The first 10 years of a HELOC are what’s known at the draw period when the borrower can draw from the line of credit, and repay as needed.  The payments during this period are interest only.  However at 10 years, the line of credit is no longer available and the outstanding balance must start to be repaid as an amortized loan, usually over 20 years.

So for example, if a homeowner has an equity line with a balance of $125,000 at 3.4% their interest-only payment would be $354.  When that loan re-sets and the homeowner is paying principal and interest payment more than doubles to $718.54.  This could pose a real problem for households where post-recession income gains have been limited.

Need to discuss a possible short sale?  I have seven years of experience successfully negotiating short sales throughout San Diego County.


There are many factors that go into determining if a short sale is right for you. A short sale occurs when your lender agrees to; 1) allow you to sell your home for less than what is owed and 2) accept that reduced amount as pay-off on your loan, releasing you from any further obligation.

So here are some questions to consider if you are thinking about a short sale:

Are you upside down? Do you owe more than your house is worth?
Despite the fact that there have been significant increases in home values throughout much of the country over the last year, most people who purchased a home between 2005 and mid 2007 have yet to regain the equity they thought they had acquired. To determine fair market value of your home, consult a Realtor. Do not rely on online value estimators as they can be terribly inaccurate.

Are you struggling to make your payments? If keeping your home is creating a financial hardship, and the market in your area is relatively soft, continuing to make payments on negative equity may not be a sound financial decision.

Have you been unable to obtain a loan modification? While most lenders are reluctant to reduce the principal amount that you owe, a loan modification is an option you should explore with your lender before considering a short sale.

Will you qualify? Increasingly, lenders are allowing short sales due to negative equity, but for the most part, borrowers must demonstrate a financial hardship and an inability to continue to make payments.

What are your housing plans for the future? If you are hoping to buy again, a short sale is far less damaging to your credit than a foreclosure. Many lenders will now approve a loan in as little as 1 – 2 years following a short sale.

There are some additional benefits to a short sale including the fact that the lender will generally pay all commissions and closing costs, and unlike a foreclosure, a short sale does not have as negative an impact on your credit score. Before considering whether a short sale is right for you, it is advisable to consult an attorney and your accountant.

For a confidential consultation, please don’t hesitate to give me a call. I have successfully closed many short sales throughout San Diego County and would be happy to provide references.

Despite the fact that home prices are on the rise, there are still thousands of people in San Diego County who owe more than their home is worth and are struggling to pay their mortgage. Have you fallen behind on your payments? Have you been unable to work out a loan modification? Just don’t know what to do?

I wrote a free guide book entitled, “What to Do When You Can’t Pay Your Mortgage” to help answer some of your questions and explore your options. Just go to to request your free, no-obligation copy.

For many, selling their home in a short sale has been a solution that immediately put an end to the harassing phone calls and sleepless nights. Did you know…?

Relocation Allowance: Though a relocation allowance cannot be guaranteed, it is not uncommon for the seller to be paid $2,000 – 3,000 by the lender at the close of escrow to help with the costs of moving. It all depends on who the investor is on the loan.

No Deficiency Judgment: In California it is against the law for a bank to file a deficiency judgment against you after a short sale when the loan was a first mortgage on a property from 1-4 units.

No Cost to the Seller: In a traditional equity sale, the seller usually pays the real estate commissions to the listing and buyer’s agent, along with his/her share of the closing costs. In a short sale, the bank pays all of those costs.

Here are comments from a few of my clients about their short sale experience:

“Marti was able to quickly secure a qualified buyer for our home and smoothly handled all of the negotiation with our bank. It was a huge relief to be out from under a mortgage we could no longer afford.” Megan M.

“Our situation with both a first and second mortgage and different lenders was very stressful, and I was leery of doing a short sale… I had heard so many horror stories. But Marti patiently walked us through the process and thoroughly explained every step along the way. Despite a reluctant 2nd lien holder, Marti was able to negotiate the sale and get it done.” Amber B.

“My only regret is that we waited so long to list our home for sale. I would highly recommend Marti to anyone faced with a mortgage they just can’t pay.” Lane M.

If you can’t pay your mortgage, please don’t ignore the problem. It is okay to ask for help and advice. Just remember that time is of the essence. Acting early allows you to make the decision that is best for you. Wait too long and your choices disappear. Get your free booklet today or call me at 619-846-9249 for your confidential consultation.

Great news for homeowners who experienced a short sale and are ready to buy again! HUD announced yesterday that they will reduce the wait period to qualify for an FHA backed mortgage to 1 year! Previously, the wait time to qualify for an FHA backed mortgage was 2 years following a bankruptcy and 3 years following a foreclosure or short sale. According to FHA Commissioner Carol Galante, “FHA recognizes the hardships faced by these borrowers, and realizes that their credit histories may not fully reflect their true ability or propensity to repay a mortgage.”

This of course does not mean that everyone will qualify. Borrowers must prove that they experienced an “economic event” where their household income fell by at least 20% for 6 months or longer. They must also document that they have fully recovered financially, and agree to take a housing counseling course prior to close of escrow.

This is very encouraging news for those of us who have helped clients through a short sale, as many have recovered and are ready to buy again while housing prices and interest rates are still relatively low. Reducing the wait time should also encourage overall housing market recovery as more people will be eligible for FHA financing. Likewise, this is good news if you are currently facing a short sale as you will now be able to buy again much more quickly.

If you have any questions about FHA reducing the wait time to borrow after a short sale, or short sales in general, please don’t hesitate to give me a call.

If you are considering selling your home in a short sale, the selection of who will represent you is an important decision. Not only will the agent be marketing your home, but they have the added responsibility of representing you in negotiations with your lender(s) and securing approval of your short sale.

So if you are wondering how to select a short sale agent, here are some questions you will want to ask when interviewing potential agents:

• Does the agent personally do the short sale negotiation or do they hire an in-house or outside negotiator? If they use the services of a negotiator, the following questions should be directed to that person or company.
• How much experience do they have? No number of certifications will make up for lack of experience.
• What is their success rate? It is likely they have had at least one unsuccessful negotiation. Ask them why it did not get approved.
• Ask them to explain the short sale process and what you can expect in terms of a timeline and the documentation you will need to provide. (They should provide you with some sort of a handout explaining the process and describing the required documents.)
• Will they request a preliminary title report? (This is important in order to determine if there are additional liens on the property that will have to be cleared).
• Do they request that the buyer deposit their earnest money into escrow BEFORE the short sale is approved? (This is a good way to make sure you have a serious buyer and keep them in the game and not out looking at other properties. If the sale is not approved, the buyer of course gets their money back).
• How often do they contact the bank during the review process? (They should be in contact with the bank at least once, but preferably twice a week.)
• How often will they provide you with updates? (You should expect an update at least once a week.)
• If you have received a Notice of Default, and/or a sale date has been set, what steps will the agent take to have the sale postponed?
• Are they familiar with HAFA guidelines? Are they familiar with Equator? (If they do short sales on a regular basis, the answer to both should be “Yes”).
• Can they supply you with a reference from at least one client that was happy with their short sale services? Just because they advertise on TV doesn’t mean their clients are happy.
• And finally, are they empathetic regarding your situation, or is their only concern getting the listing? A short sale can be emotionally tough for you the seller and you should work with an agent who cares about you and what you are experiencing.

Do NOT believe them if they tell you they have an inside connection at your bank and can guarantee that your short sale will be approved. That is simply not true. Investors have the final say on approvals and it is highly unlikely that the agent even knows who the investor is at this point, not to mention that investors do not speak directly with negotiators.

If you have any questions about how to select a short sale agent for your San Diego County home, please don’t hesitate to give me a call for a confidential consultation.

It’s not your imagination: The housing market recovery is on a roll, upwards! A recent survey of over 100 real estate and economic experts predicts that by the end of 2013, home values will have increased nationwide by an average of 6.7% over a year ago. This is significantly more than the 5.4% bump anticipated in an earlier study.

The Home Price Expectations Survey was conducted by Pulsenomics, LLC on behalf of Zillow. Based on market expectations, the panel predicts that home prices will continue to rise until 2017, coming very close to the record highs of May 2007. The rate of increase however will not be as dramatic as 2013, with appreciation anticipated to slow to 4.4% in 2014 and down to 3.4% in 2017. This represents a cumulative increase of 23.7% through 2017, at which point appreciation is expected to be more in line with historic norms.

Interestingly, most panel members did not feel that rising interest rates would derail the recovery, unless interest rates rise above 6.0%. According to Zillow Senior Economist Dr. Svenja Gudell, “As long as interest rates don’t rise too far and too fast, most markets should be able to absorb these changing dynamics and remain healthy.” It is anticipated that as interest rates rise, investors will pull out of some markets, increasing inventory and helping to stabilize the market.

What does this mean for you? If you are looking to buy, now is the time as prices will continue to rise. Looking to sell? You are more likely to get top dollar between now and the end of the year as inventory, especially here in San Diego County is very limited. As appreciation slows and more inventory hits the market it is less likely that the multiple offer scenarios that we are currently experiencing will continue.

Questions about the value of your home? Interested in an investment property? Just give me a call and I’ll be happy to answer all your questions.

Ever wonder why it was so difficult for people to get permanent loan modifications a couple of years ago? Maybe it’s because some employees were allegedly paid to make sure they were denied, at least at one bank.

According to a June 14 article, Bank of America provided employees with incentives including cash bonuses and gift cards for meeting quotas linked to sending homes into foreclosure. The allegations were revealed by past employees as part of a lawsuit filed against the banking giant earlier this month by homeowners who were denied modifications. Many who were denied loan modifications eventually lost their homes to foreclosure.

Apparently employees in the loss mitigation department were instructed to delay review, ask homeowners for items they already had in the file, and do whatever was necessary to deny permanent loan modifications. Former B of A loan servicing specialist Theresa Terrlonge said that they received restaurant gift cards and cash rewards for denying loan modifications. “I witnessed employees and managers falsify information in the systems of record, and remove documents from the homeowners’ files to make the account appear ineligible for loan modification,” said Terrelonge.

But the big rewards came for actually pushing a borrower into foreclosure. According to Simone Gordon, a loss-mitigation representative who left the company in 2012, specialists who put 10 borrowers into foreclosure, including those in a trial modification, received a $500 bonus. Bank of America insists that the allegations are inaccurate and will file an opposition to the motion to make this a class action case.

Unfortunately, I’m not terribly surprised by these allegations and find it difficult to believe that B of A was the only bank involved in this type of behavior. It’s no wonder that there have been so few successful loan modifications; the very people charged with creating positive outcomes were apparently paid to do otherwise.