Tag: Short Sale Process
Posted by http://www.floridashortsales.info - April 25, 2012 - News
What is the process for completing a short sale?
Florida Short Sale Process | Short Sales
The process of completing a short sale can seem difficult, but if you understand the process you will find out that it isn’t. But it is a long process .The first step to the process is sending the lender proof of hardship to show why you fell behind on your payments. Next a negotiator will be assigned, which can take 30-60 days. The negotiator will request paperwork to update them on your current situation. The paperwork will include, a hardship letter, a financial statement, tax returns, bank statements, paycheck stubs and other things depending on which lender you are working with. The Lender will then order a BPO (broker price opinion). A BPO determines the market value of the property. A second negotiator may be assigned which can take another 30 days. The file will then be sent to PSA (Pooling Servicer Agreement) for approval, which can take 14-30 days.
Posted by http://www.floridashortsales.info - March 20, 2012 - News
The Short Sale Process
The real estate short sale is a relatively new term in the housing market. It is not only confusing to buyers, but also to many real estate agents. That is why if you are interested in a house that is going through this process it is important to go through a short sale realtor. You want the expertise of a professional who knows the ins and outs of this particular housing market method.
Seller’s Process
When a seller wishes to begin this process, he must get approval from his lender to do so. The seller would choose to take this route to sell his house, most likely, because he is having financial troubles which are making it difficult to keep up with his house payments. Also, the house is probably worth less, in today’s market, than he owes on his mortgage.
The bank requires the seller to complete a packet of information Although each bank has its own specifications of requirements when a seller decides to short sale a house, the documents are similar.
* Authorization letter
* Preliminary net sheet
* Hardship letter
* Financial statement
* 2 years worth of income tax returns
* 2 years worth of W2s
* Payroll stubs
* 2 months of bank statements
* Recent comparable house sales
Buyer’s Process
It’s important for the buyer to realize that just because the house is priced lower than market value, the bank may have agreed to the price expecting multiple offers to drive the price up. This is why it may take many months for the bank to respond to a buyer’s offer, as the bank waits out for more offers to arrive. The buyer should start with the comparable house sales report from their real estate agent. Make sure you know how much the short sale house is worth, verses the offering price.
After the buyer makes a formal offer, through his agent, the amount first must be accepted by the home owner. The listing, short sale realtor will then send that offer to the mortgage holding bank, plus:
* Buyers pre-approved letter
* Earnest money
* Seller’s short sale document packet
Bank Process
When the seller decides to short sale a home, he is primarily hoping to get out of a difficult financial situation. Still, it is ultimately up to the bank as to how much and when they will accept an offer. It can be quite some time before the buyer hears anything from the bank about the process. You should not go into this type of home buying situation unless you are in a situation that permits you to put off your purchase for several months.
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Posted by http://www.floridashortsales.info - March 8, 2012 - News
Short Sale Process
Everyone knows that these are tough times we live in. We need to do things now that we do not necessarily want to do. If you need to short sale a house, go to this website,
Florida Short Sales. You will find all sorts of information that will assist you in understanding the short sale process. But we certainly understand the emotional importance of talking to a person, so just give us a call if you would like to speak to a
Florida short sale broker.
Part of the
short sale process is working with an excellent program by the name of
HAFA (home affordable foreclosure alternatives). This program is specifically designed for homeowners who are unable to stay in their home even with a loan modification. Homeowners may be able to avoid a foreclosure by selling their house as a “short sale”. Our short sale realtors specialize in the short sale process and will make this difficult time in your life a lot easier.
Posted by http://www.floridashortsales.info - December 27, 2011 - News
Certified Distressed Property expert
I’m not sure attending a few class room hours of education makes you an expert at anything. Becoming an expert requires years of experience and countless hours of continued education. I say this as I’ve met many with the certification of a
CDPE and most leave much to be desired. I always tell people that the home in which you may desire to
short sale was at one point the most valuable investment you ever made. I assume most of you took great care when making the purchase and certainly hope all of you will take additional care when dumping what is your worst liability.
Kid yourself not, you must find a Broker or top Realtor that really understands the landscape, and is equipped and motivated to take on the
Short Sale. I have seen more
short sales get screwed up as the realtor had no clue as to what they got themselves into. And when you hire anyone that that claims they will assist you in the
short sale process please do not pay one penny. In many States it’s become illegal to charge upfront fees but there always seem to be some clever folks out there that figure out a way to circumvent the system.
We have taken on short Sales for the last four years and have never charge a dime upfront. We don’t charge as we know we will get the deal done, not to mention the fact that Short Sales are the only type of real estate we handle.
Find A Proven Realtor
You should only rely on those folks that have successfully completed countless shorts sales. Make sure they do not off your file to a title company that will attempt to process the short sale. Many times Realtors and Title companies become frustrated with the process and just give up. Not good.
Short sales are complicated transactions and tend to be very time consuming. Clients who have no experience with short sales might not understand the importance of procuring a
Florida short sale realtor which has experience dealing with the lender or who ever is servicing the loan. Have you heard of Equator? This is a electronic platform that allows for communication between the lender/servicer and the Real Estate Broker or Attorney handling the file. It’s amazing the amount of paperwork that is amassed during the short sale process. Try sending a ninety page fax, follow up with the lender in forty eight hours to be told, we never received the fax. Frustrating for sure. And that little process can easily kill a couple of hours.
HAFA
I remember when we started doing short sales back in 2007, that was truly a puzzle that never seemed complete. Things have improved greatly as the lenders have developed systems and protocols to make this all happen. I often explain to clients that these institutions were not set up to perform these types of procedures. Starting back in 2009 things started getting better. Not to mention the mess with who would take the hit on the loan. The originator of the loan, the mortgage insurance company, the second lien holder or the lender? Would the government step in and take some of the pain. As it ends up these issues are still not clear and to this day there is much litigation concerning these very facts. One thing is for sure, if there is a buyer looking to buy a
short sale all parties involved now understand it’s in their best interest to move the property and get it out of inventory. Once the government stepped in with the
HAFA program it sort of greased the wheels a bit. Not all home owners will reap the benefits of HAFA which I will dedicated an entire post to. But the short of the long of it is simply the motivation this provides for the lenders to receive some financial rewards from the government. Yes I know, another bail out.
Due to the complex and lengthy back and forth necessitated by these transactions, a
Florida short sale realtor is often necessary for translating and providing guidance. In some instances, lenders won’t allow a client to enter in to a short sale without the presence of a realtor. There are specific deficiency laws, tax ramifications and foreclosure processes in each state which an educated Broker can at least steer their clients in the right direction. Of course I always recommend reaching out to a licensed Attorney with any legal questions. . Contacting a Florida short sale realtor ensures that no stone is left unturned that could create a liability later on in the
short sale process.
Marketing a home that will hit the market as a short sale is a major undertaking, and involves a certain level of strategy to ensure the right contacts are made and nourished. Failing to adequately market and prepare a home for a short sale can increase the amount of time the market. Short sales can be impacted by a number of collateral factors, all of which are sure to consume plenty of time outside of marketing and promotion. Ultimately, clients looking to procure or sell a property as a short sale face a much different road than those selling as an owner or buying on their own terms. Failing to work with a short sale specialist can result in an agreement that is skewed towards one party or the other. Additionally, circumstances beyond the buyer’s or seller’s control can change the direction of a short sale transaction instantaneously.
There was a moment in time that Realtors would not touch the
short sale processing and dumped it on the Title company. Now Title companies realize there is no novena and seemed to have lost interest in short sale processing as well. Take it from a guy that’s done hundreds of these (it’s all we do), it takes a complete organization built around doing short sales to be effective.
Call For A Free Consultation Today
888-496-0167
Posted by http://www.floridashortsales.info - December 20, 2011 - News
They can make you crazy
Strategic Defaults
The question I get often is what do we do now. Many times my answer is very straight forward and applies to most folks that find their
properties upside down. If you owe $250,000 on a mortgage and the property is only valued at $125,000 I think you better think long and hard of a proper strategy. Lets face it, the odds of that property growing in value to $250,000 (Parr value) may take ten or fifteen years and maybe longer. The simple answer is no one really knows what will happen. But I know this much, you do not own anything. What I mean to say is you have a major liability rather than an asset. Not a good way to look to the future for retirement. The way I interrupt this scenario is you are renting the home from the lender. And if each and every dollar you pay towards the mortgage is not adding to principal then what is the sense.
I would never tell someone to
default on their mortgage but I would tell each and every client to think about capital preservation and long term financial planning. In that vain we need to think about what is best for you and your family. And to think the lender cares about your situation you would be sadly mistaken. The lender cares about one thing, squeezing as much cash from you as possible. There comes a point where you need to sit back take a deep breath and understand the consequences of what you do today and how that will effect your financial well being in the years to come.
I too have been in a similar situation as I owned a good size building company from 2001 through 2008. I found myself upside down to the tune of two million dollars. I took quick and swift action to clear the deck and get ready to fight for another day. I realized that the loses had already impacted my financial health and knew I needed to get the monkey off my back to allow for improving my personal financial health.
At the end of the day I sat back and evaluated how such actions would effect myself and my family and decided the proper course of action was to rid myself of what had become worthless inventory. This allowed me to get back to building the kind of financial well being required for my family.
Working With Your Lender
Can you fax that document one more time
Working with your Lender is not an experience many of us wish to ever do again. Many have learned just how poor some of these major institutions are run and have such a bad taste in their mouth they rather never call the lender again. I don’t blame you, after working with the lenders day in and day out for almost four years I have come to have a real appreciation for my staff members that endeavor that task each and every day. Hearing a lender say, can you fax that back over is enough to make a sane person crazy. Where did the last 95 page fax go to? If I told you how many times we have heard this it would be enough to make your head spin. I learned early on the lender is not your friend. With the advent of a new system called
Equator things have improved, the problem is very few of the lenders have adopted the system. At one point when I managed the Law Firm I hired a
loss mitigation specialist that had worked with Ocwen Bank and a Regional director with Freddy Mac. The stories they told me were almost unbelievable.
But having worked in the trenches since 2007 it all started making sense. What most people do not realize is these institutions typically dealt with very few
short sales and
foreclosures. The loss mitigation department for a large institution was made up of only ten or less employees. These days that number could easily be in excess of 500 for a large lender. Normally these institutions would handle questions by clients, receive payments and send out statements. Really simple when you think about it. So what did the geniuses do in 2008? Fire almost 250,000 folks working in the banking business.
Then it started, up to 25% of all homes found themselves to be under water (40% in Florida), where the value of the home was much less then the current mortgage balance. To add additional fuel to the fire the unemployment rate in the united States soared to over 9% nationally. Talk about a squeeze play. The
mortgage defaults started piling up at such a high rate the lenders could not handle the onslaught of
Loan Modification request,
Short Sale requests and requests to perform a
deed in lieu of Foreclosure. A mess to be sure.
As we fast forward to the start of 2012 the landscape looks as bad today as it did three years ago, and many think much worse. The level of shadow inventory in the United States is so immense it’s enough to make your head spin. Some say it may be 2017 by the time we dig ourselves out of this mess. A shadow inventory represents those properties that are literally in limbo, houses that could be foreclosures on but are not, or home that have been foreclosed and have yet to be put on the market to be sold.
