June 24, 2015

Another Wave of Short Sales on the Horizon?

Posted by martikilby under 2nd mortgage, Short Sale | Tags: , , , , , , |
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San Diego short sale specialist

According to Home.com’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.

 

November 25, 2013

Is a Short Sale Right for You?

Posted by martikilby under Experienced Short Sale Realtor, foreclosure, loan modification, Short Sale | Tags: , , , , , |
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SHORT SALE BUTTON

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.

 

November 22, 2013

Can’t Pay Your Mortgage?

Posted by martikilby under Experienced Short Sale Realtor, Mortgage delinquency, Short Sale | Tags: , , , , , , |
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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 http://cantpaymymortgagehelp.com 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.

 

August 19, 2013

How to Select a Short Sale Agent

Posted by martikilby under Experienced Short Sale Realtor, foreclosure, Mortgage delinquency, Short Sale, Short Sale Negotiation, Underwater homes | Tags: , , , , , |
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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.

 

June 11, 2013

La Mesa Short Sales

Posted by martikilby under Experienced Short Sale Realtor, La Mesa CA, Short Sale | Tags: , , , , |
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Thus far in 2013, here are the La Mesa short sale numbers; 41 detached homes have closed escrow, and 19 other types of homes, including condos and mobile homes. This is down considerably since 2012 when for the same period; there were La Mesa short sale closings for 69 detached homes and 31 for other types of homes.

Although these numbers have decreased in the past twelve months, it is likely that short sales will continue to play a significant role in our real estate market. According to Zillow CEO, Spencer Rascoff, 44% of U.S. homeowners with a mortgage still owe more than their home is worth. For the thousands of folks that remain underwater, a short sale might be a good solution.

If a short sale is an option that you’re considering, you’ve probably heard horror stories about how long it takes, and how few sales are ever approved. That’s often because the listing agent doesn’t understand the short sale process, or lacks the necessary experience and negotiation skills. Steele Group Realty has been negotiating short sales for 5 years and has a 95% success rate for successfully selling and closing short sales throughout the county. Here’s how we take the mystery out of La Mesa short sales and improve your possibilities for a successful close:

• Before listing your home, we determine if a short sale is an appropriate option and if you qualify according to general lender guidelines.
• We research your title report to identify any potential issues and develop a strategy to overcome obstacles.
• If approved to enter our La Mesa short sale program, we aggressively market your home on over 100 high-traffic websites to quickly secure an acceptable offer.
• Our professional short sale negotiating team works with your lender to win approval. We have an unbeatable track record, successfully closing over 95% of all transactions.
• All fees and commissions are paid by your lender, not you.
• Depending on the investor for your mortgage, we may be able to negotiate a relocation allowance ranging from $2000 to upwards of $10,000.
• From start to finish, we guarantee to keep you informed of the progress on your sale with regular phone and email updates.
• Click here for references

For a confidential, no-obligation consultation regarding a La Mesa short sale please contact me at 619-846-9249.

 

April 22, 2013

La Mesa Short Sale Specialist

Posted by martikilby under La Mesa CA, Short Sale | Tags: , , , , , |
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La Mesa Short Sale Specialist

SHORT SALE BUTTON

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. As your La Mesa short sale specialist, here are 3 things you might not 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.

I have lived and worked in the La Mesa, Fletcher Hills, and Mt. Helix area for years and have been a La Mesa short sale specialist for over 4 years. Here is what a few of my clients have said 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.

There are more than 3 things to know about a La Mesa short sale and your options. 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. Call me, your La Mesa short sale specialist at 619-846-9249 for your confidential consultation or click here to request your free guide book.

 

December 19, 2012

Is Bank of America Writing Their Own Rules, Again?

Posted by martikilby under Bank of America, Experienced Short Sale Realtor, Short Sale, Short Sale Negotiation | Tags: , , , , |
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For any real estate professional negotiating a short sale, the moment you receive that magical approval letter there is usually a sense of celebration and relief. Not so on Monday when I received an approval letter for a standard short sale I am negotiating for another agent in my brokerage.

All of the terms looked fine, EXCEPT there was no allowance for relocation assistance. This is a Freddie Mac loan serviced by Bank of America that I am managing through the Equator platform, so I messaged back immediately. Money for relocation assistance has been an expectation since day one of the short sale process as the homeowner is a single mom with four children under the age of eleven who is currently off the job and receives disability as her only source of income. If anyone ever needed help with the expenses of moving, it is this poor woman!

The reply back from B of A was that the “borrower did not meet the investor guidelines for relocation assistance.” Are you kidding me? She is penniless! So I requested further clarification regarding the specific guidelines. I was told that “any borrower with a loan with MI (mortgage insurance) is automatically disqualified from receiving relocation assistance.”

Does that make ANY sense? I scoured the Internet and contacted a couple of fellow brokers who are short sale experts and no one could find anything to support this “rule”. In fact, everything I discovered supports that fact that as of 11/1/12 Freddie Mac would pay up to $3000 for relocation assistance, with no mention of an MI exception.

So yesterday morning I called Freddie Mac directly. They were incredibly responsive and helpful. The gentleman I spoke with put me on hold for quite a while as he researched the question, finally coming back on the line to tell me that he needed some additional time to investigate and would get back to me before 5:00 pm. At 4:45 he called to report that in all of his inquiries, no one he spoke with at Freddie Mac could find any reason why MI would disqualify a borrower from receiving relocation assistance. So Freddie Mac has opened an internal investigation to determine if the ruling by Bank of America is within guidelines or if they have overstepped the limits of their authority by denying relocation assistance. Ha!

I was told it might take up to a month to receive results of the investigation, but I feel better knowing that we are doing everything we can to help get our client the money she so desperately needs. And I have to admit it felt pretty good to have my hunch regarding this rule, somewhat vindicated by a giant like Freddie Mac. I’ll be letting Bank of America know about the investigation this morning 🙂

I guess that if it just seems wrong, it never hurts to question.

 

April 23, 2012

3 Ways to Kill a Short Sale

Posted by martikilby under Experienced Short Sale Realtor, Short Sale, Short Sale Negotiation | Tags: , , , , , |
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Short sales are tricky at best, and negotiating a successful resolution can try the patience of even the most experienced agent.  With the foreclosure clock often ticking, it’s important that the listing agent keep the transaction on track. Here are a few things agents should avoid that can be real deal killers:

  1. Accepting the wrong  offer.  If you know that the property has termite issues, doesn’t have a working heater, or has other significant repair issues, look carefully at the type of financing  the buyer will use.  VA will not allow the buyer to pay for repairs and it is unlikely that the lender will  pay.  FHA also has fairly stringent rules about the condition of the property, unless it’s a rehab loan.  If there are issues with the condition,  selecting a buyer that is using conventional financing, or cash and agrees  to buy the home “As Is” will improve your odds of success.
  2. Failing to  communicate.  As we all know, short sales are anything but short in terms of the time it takes to close.  Having a buyer that stays the course and doesn’t wander off to buy a different property is critical.  The listing agent should be in touch with the buyer’s agent at least twice a week and provide  updates as soon as they are available.    I also have the buyers deposit their earnest money into escrow within 3 days of acceptance of their offer by the sellers – we don’t wait for short sale approval.  Buyers that have put their money into escrow and receive regular progress reports tend to be much more committed to completing the purchase.
  3. Assuming….anything!  Just because you faxed in your seller’s tax returns, doesn’t mean that they were received and made it  into their file.  For most banks, allow 48 hours for items faxed to the loss mitigation department to be  posted into your seller’s file, then call and confirm.  Failure to provide documents when requested can kill the deal.  Also, don’t assume that the 2nd lien holder will accept whatever  pay-off, the 1st lien holder offers.  Don’t wait for the 1st to be  approved to start negotiating the 2nd .  Better to know what they want early in the game.

The list could go on and on, as each sale has its own peculiarities that could spell trouble.  The key to short sale success is a combination of patience, education, organization, tenacity and a crazy instinct to anticipate obstacles and leap over them before the deal dies.  Good luck out there!

For a no-obligation consultation regarding a short sale inSan Diego County please give me a call at 619-846-9249.

 

March 13, 2012

The Bank of America Un-Cooperative Short Sale

Posted by martikilby under Bank of America, Short Sale, Short Sale Negotiation | Tags: , , , , |
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Last March, I participated in a Bank of America webinar where they introduced their Cooperative Short Sale Program.  I remember being cautiously optimistic because the speaker promised that the Bank would respond to offers in 10 days.  Well, it’s now been five, yes five months since I uploaded an offer for the Cooperative Short Sale purchase of one of my listings.  We are finally in escrow and set to close on April 6th, but this has been, to say the least, a rocky road and not what I would call a “cooperative” negotiation.  Here are a couple of the low points:

  • The amount that B of A was offering to the 2nd lien holder was incorrectly communicated to  me.  They offered one amount and  then later came back with a much lower figure. I had to escalate the issue  and get pretty angry to make them stick to the original amount offered.
  • Shortly after finally getting  an approval in the first week of February, our buyer lost her job and we had to substitute her husband as the buyer.  Same transaction, no changes except the loan and sale were now going to be in the husband’s name.  It took over a month to get a new approval, and that was after I again had to escalate the issue.

Here is what I see as a big problem with the whole system:  Although the Equator platform is supposed to keep all parties in communication, it really doesn’t work that way.  Bank of America farms out the work of negotiating their Cooperative Short Sales to Asset Management Outsourcing, Inc., AKA, AMORecoveries.  So during the whole “negotiation” portion of the short sale, the agent for the seller is only in communication with a case worker at this company.  If you do need to escalate a matter to B of A directly, they might not be in the communication loop as far as the file and Equator are concerned.  Additionally, I find communicating through Equator sketchy at best.  Every step of the process is a “task” that gets accepted, completed or denied, and let me tell you, a short sale is simply not that black and white.  The only way I really got anything accomplished was when I could actually speak to someone.

Once you finally get an approval, the file becomes the responsibility of a “closing specialist” back at B of A.  So the person you’ve been dealing with throughout the whole process is now out of the picture.  When we had to substitute the new buyer, the file went from our “closing specialist” at B of A, back to AMORecoveries, to a different negotiator who thought it was an entirely new file!  I thought I was going to tear my hair out!

So I’m not a fan of the Bank of America system or the Cooperative Short Sale program that was supposed to streamline the approval process.  And I know that without going up the food chain and fighting for my seller this deal wouldn’t be closing.

 

Got a tough short sale in San Diego County?  Give me a call!

 

 

 

January 26, 2012

Video – The Short Sale Process, Part II

Posted by martikilby under Experienced Short Sale Realtor, Short Sale, Short Sale Negotiation | Tags: , , , , , |
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In the second of a 2-part series, San Diego real estate broker Marti Kilby explains the short sale process.


 

 

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