Short Sales, Loan Modifications, Foreclosures, & More!

Deed for Lease

2010-10-06T08:15:00.000-07:00

If you get approved for a Deed For Lease (D4L) Option, the lender will lease back to you for a year at a rent of 31% of your income. In order to apply you must have been denied every other government program available. This is quite complicated and it’s confusing as to why one would be denied another program such as a loan modification because those are also based off of 31% of your income. The assumption is that you will buy your home back in a year. Of course if your credit is messed up at this time, that could be a near impossible task, but at least it will give you the advantage of living in your home at a reasonable price while you make future plans. I believe with all the discrepancies of this program, many adjustments to the rules and regulations will take place in the near future unless they get rid of the program all together. Not many success cases have been made on this one.

HAFA…Home Affordable Foreclosure Alternative

2010-09-13T08:50:00.000-07:00

This is the first program you should apply for when looking at all your options. Call your lender and let them know you want to apply for the HAFA program. They will send you an application in the mail that will need to be filled out within 14 days. Do not waste any time here or you will be immediately disqualified. Some of the benefits on this program in comparison to the others is that the lender is obligated to release the debt, they can pay up to $3000 to the seller in a short sale situation, and banks are supposed to respond within 10 days. Now two things to take note of…Although they can pay up to $3000 to the seller, typically they make a case and state that they need “x” amount towards repairs which is why most of the time its much less. Another frustration is that even though the lender “MUST” respond within 10 days, there is currently no Penalty if they don’t which of course the banks are extremely aware of as well. So hopefully there will be some kind of penalty in the near future to the banks if they don’t respond on time as the mortgagee has to respond within 14 days or else.

Government Programs

2010-08-31T09:05:00.000-07:00

Are you aware of the six different government programs currently available for home ownership programs towards avoiding foreclosure? The first one is MFA, Making Home Affordable. This consists of refinancing, modifying, short sales, and deed-in lieu options. The second one is HAMP, Home Affordable Modification Program. The third is UP, Home Affordable Unemployment Program which is obviously geared towards the unemployed. Fourth is HAFA, Home Affordable Foreclosure Alternatives which is one of the newest programs and the one you should go for first before the others. The fifth option is 2MP, Second Lien Modification Program and lastly is D4L, Deed for Lease Program.

It costs lenders approximately $80,000 in fees to go through a foreclosure in addition to the balance they are not being paid, so these government programs are most definitely worth attempting to take advantage of.

TARP Money not helping...

2010-06-30T09:21:00.000-07:00

Unfortunately the banks are not getting easier to deal with. The TARP money has been easily received and the FEDs are pushing back on the lenders because they don’t feel like the desired outcome has resulted, so then the lenders push back and blame the borrowers. OH it’s just so frustrating! So if you have been trying to get a personal loan modification approved you may receive a letter one day stating we need the following items X, Y and Z; then in another 5 days receive a letter stating that your loan modification has been declined. Why do they do this? They do it to show the FEDs they are actively trying to do the loan modifications but that the borrowers are taking too long to respond and so then they have to decline immediately. This is just another reason to get involved with a 3rd party negotiator they will typically call multiple times a week to stay on top of the bank. Then they will push back on you to get the info ASAP when needed. Remember to check the list from the link in the previous blog. Ugh!

State of Oregon Loan Modification/Short Sale Regulations

2010-06-10T09:36:00.000-07:00

The State of Oregon keeps coming up with additional rules and regulations to govern the short sale/loan modification process. You may have been working with a 3rd party negotiator in the past few weeks and then found out that they can no longer work with you because of these new rules. There is a new site that lists the licensed negotiators that are available in the state of Oregon…www.cbs.state.or.us/dfcs. Unfortunately it seems that getting a loan modification seems to be getting more and more difficult even though the process is becoming more streamlined! It just doesn’t make any sense, so utilizing a 3rd Party Negotiator can be extremely useful as well as in alleviating yourself of the time and stress it takes to deal with the banks on a weekly basis. If you are considering using someone, check around with friends and family for a good referral source and then check on the state site to make sure they are licensed. Good Luck!

PRINCIPAL REDUCTIONS TO HOPEFULLY BECOME A TAD EASIER!

2010-04-26T19:25:00.000-07:00

It’s official... or so they say! Bank of America is stating they will start doing up to a 30% principal reduction! See these articles for more information (article 1, article 2).Other banks such as Chase, Citibank, & Wells Fargo should be following suit hopefully in the near future. It is extremely difficult to meet the Making Home Affordable requirements for a loan modification part and even more so for a principal reduction. This is why the banks are starting to implement their own programs as they are approved with investors. If you have been denied a short sale, modification, or principal reduction, it is not too late to try again. If you are in the Oregon area, I can help with providing comps to use in your package.

Escalate!

2010-04-12T14:54:00.000-07:00

Apparently one of the Key terms to moving your Short Sale or Modification along is “Escalate.” There are so many employees constantly being brought on board, that have no clue, and yet they are in your negotiation phase causing all sorts of problems, because they are new! Past documents gets lost, and you get different stories of what's going on, and worse. So do not hesitate to ask for an Escalation. Please feel free to post how this works out for you and if it makes a difference. Many times they will tell you…. NO, we have our process and there is no way to push yours ahead of others. But it doesn’t hurt to ask, over and over and over. Short Sale systems are changing literally daily. Another huge deal is to call EVERY WEEK, if not more, do not wait for them. Good Luck! By the way more positive changes will be taking place in May so don’t give up!

OREGON AWARDED $88 MILLION FOR THE HARDEST HIT HOUSING MARKETS

2010-04-03T10:34:00.000-07:00

Oregon awarded $88 Million through the Federal Government Fund: Hardest Hit Housing Markets…

See the State of Oregon Press Release here.

If you have previously been denied a loan modification or short sale, now is the time to make a 2nd attempt.

GMAC MORTGAGE LOAN MODIFICATION APPROVED!

2010-04-02T09:33:00.000-07:00

Here’s an experience of a friend that recently did a successful Modification with GMAC Mortgage, which is pretty unbelievable considering my experiences with them about 4 months ago. The first time he tried to get a Modification done on his mortgage, they approved him in one month which was amazing. The negative that happened is that during the trial period he actually paid his mortgage 1 day early, and because of this they immediately denied trial and cancelled it. So he turned around and sent in package again. Once again, it took just a month for him to get approved, and this time they actually made the mod for an additional $400 less! Funny thing is that this was still based off of the same original figures. Then they told him he owes money because of the denied Modification from the previous month he was supposed to pay the difference. So after fighting it for approximately a week and Escalating the case and he won getting his new trial and making sure this time to pay exactly on the day owed, not a day early and not a day late. He was told as many of us have been told that the mortgage was supposed to be a third of his monthly income. Hopefully this positive news convinces you to try again on your mod if you have previously been denied.

Another One Aproved

2010-03-16T11:44:00.000-07:00

It only has taken 10 months to be exact in getting this last one approved as we’ve had to jump quite a few hurdles. First off the bank (Bank of America) would not recognize the short sale package, we sent it in about 5 times before they actually acknowledged reciept. There is unfortunately a 2nd with another lender (Etrade) so first you have to go back and forth with the first to get towards approval, fight values, ward off the looming foreclosure dates, argue that more Broker Price Opinions need to be done, ect. Then we had to fight with the 2nd. They want at least 15% of what they are owed, but the first will only give them $3000. If you are familiar to short sales this is nothing new. Then our next headache was that the 2nd sold the note, so we had to start all over froms scratch with them, only to find they had sold it back to the original lender, but with a different servicer. Then the snow storms on the east coast shut down them down for 2 weeks, furthermore backing us up. Well I’m proud to announce that the Bank of America hung in there with us because of our past relationships with them, and so we now have an approval on the 2nd, with the first paying them $5000 and a closing next month. Hopefully the Buyer’s mortgage broker gets the deal done from here!

Short Sale Stats

2010-03-08T18:19:00.000-08:00

As a Certified Distressed Property Expert we are constantly being inundated with the progress of short sales and government programs that are available. Unemployment rates increased to 9.7% according to the January 2010 U.S. Bureau of Labor Statistics, is this effecting you? Have you been considering going through with a short sale or foreclosure? Not wanting to put the time in for a short sale?

If so here are some things to consider… Current Employment, Future Employment, Deficiency Amount/Judgments, and Future loans (car, mortgage, business, ect.) based on Credit Score/History that could have an impact on your family and future.

As lenders work out the kinks….

Short sales have jumped from about 10 percent of distressed property sales during most of last year to 15.9 percent of home purchase transactions in January.

By contrast damaged real estate owned or bank owned properties accounted for only 13.4 percent and move-in ready bank-owned accounted for 13.8 percent of all sales, according to the latest Campbell/Inside Mortgage Finance Monthly Survey of Real Estate Market Conditions.

As recently as November of 2009, short sales accounted for 12.4 percent of the home purchase market, behind move-in ready REO at 12.6 percent and nearly even with damaged REO transactions at 12.3 percent as quoted by UPI.

Their are advancements in the short sale process monthly, and I'll do my best to keep you up todate with the latest info!

2010-02-16T11:59:00.000-08:00

Currently I have about 7 Short Sales I’m working on with lenders such as GMAC, Wells Fargo, and Bank of America. Here are the progressions the banks have made to “help” out with streamlining the short sale process... 9000 people have been hired for Wells Fargo, however we are dealing with the 3-4 months it takes to train everyone, so really I don’t feel any benefit yet. In fact I have been invited to a meeting that Wells Fargo is holding with some key people including Presidents & VP’s so I’m very excited to listen and learn about their “thoughts” regarding their efforts that so far have not made a difference in my eyes. (I will update you all with what I learn) Bank of America has developed an online process that keeps us notified, however one of my files has been in “review” status for 3 going on 4 weeks now without the Broker Price Opinion even being ordered yet, so I’m not super excited about this, even though the intentions are there. GMAC, now they have not done anything different in my eyes. In fact 2 weeks after starting this process, they have already changed the locks on a door even though we have a strong offer in to them. We email and call on these files almost daily, to get no response, and then we have to escalate the cases to their supervisor, then their manager and I’m quite positive, that we aren’t the only agents doing this, so really if they just get the job done and put a system in place we could get somewhere smoothly. I’m sure that these will eventually go through to closing, it is just taking some time to get there, and through this we lose many buyers. In fact in my experience, it seems that the 8-11th offer is the one that usually takes the property. Will keep you posted!

Short Refi's... Ever Heard of Them? This could be HUGE!!

2010-02-10T12:09:00.001-08:00

The other day, I get a call from GMAC stating that I should short sell my home, I explain how I want to keep my home, and the guy goes on and on about how I should sell and how I’m making a bad decision wanting to keep a home in this market. He says if I want a home than I should just purchase another. So after going back and forth, he finally mentions that I could do a Short Refinance. He explains that doing a Short Refi is basically like doing a short sale to myself… This is exactly what I’ve been wanting the lenders to do! Almost no one wants to move because of financial reasons, they’d prefer to keep their home. So bottom line is that if you don’t have any mortgage lates, you should call your lender and ask them about a Short Refi. I asked the GMAC guy if all the lenders were doing it, and he said yes, but they don’t talk about it. Apparently it only works on Owner Occupied residences right now, but if you have investment properties and can qualify for a loan with an outside Mortgage Broker, you may still be eligible! Basically when it comes time to do the appraisal and the appraisal comes back lower than what you owe, you can send it in to your current lender to show them and then they can go about it like a short sale and choose to accept the new value and write off the difference or not. I’m still trying to learn more about these Shorts, but it is definitely worth the call if you want a principal reduction on the amount owed. If you call please post what you find out! The more people that this gets to, hopefully the less homes that will be foreclosed on!

Wells Fargo...Doesn't Make Sense!

2010-02-04T14:09:00.000-08:00

I had a Short Sale listing in the Lake Oswego area with Wells Fargo, that had a cash offer on the table. The bank did their BPO's (Broker Price Analysis, similar to an Appraisal) which came back at $280,000 & $300,000. In the process of working the short sale to fruition with our assigned bank negotiator they countered a $245K cash offer at $320k. This was definitely a first, usually banks seem to counter offers either at the BPO amount or at a discounted price of up to 20%. I was very surprised by this, as was my hired negotiator, so we sent them my comps showing values between $200-250k. They decided not to take the offer and then they foreclosed last week placing the minimum bid at $397k. Holy Moly! Of course no one in their right mind would pay that based on comps. So here we are today, a week later, trying to find out who the Bank REO Real Estate Agent is. I called and was transferred from Wells to Fannie Mae who now holds the note and they tell me that it could take up to 90 days before the home is listed.

I am utterly confused, especially when I was at a meeting last week where Wells Fargo representatives were stating that Wells had hired on 9000 people to try and stream the short sale process and make it easier on everyone. They went on and on about how they were holding meetings at the bank where people could just walk on in and have a short sale or loan mod ready to go in a matter of minutes. All I can do is wait, I guess?!?

Julie & Julia

2010-02-03T14:15:00.000-08:00

I have to say I am inspired after watching this movie to do my first blog. We all are passionate about one thing or another, and being a Real Estate Agent with many Short Sale listings, I thought it'd be worth it to create a Forum where people can discuss their short sale, loan modifications, foreclosure experiences. The banking industry is such a nightmare these days with inconsistencies and more. My intention is for people to learn from other's experiences, so that maybe someone can get ahead in this garble of a mess. My Husband is so fed up with my Short Sale Stresses he wants me to make a documentary that maybe we can send to our government so they can learn what's really going on in our Banking Industry.

At this Point, I've stopped many Foreclosures, Reversed a Foreclosure, Argued with the VP of WAMU about their process which almost got me in an ugly legal battle, Developed contacts at Wells Fargo, GMAC, & Bank of America, closed Short Sales, Lost Short Sales to foreclosures, the list just goes on and on.

I really want to know about YOUR experiences trying to do a short sale or loan modification. Such as...what bank, what did they tell you, ect. For example, I tried on one of my rental properties and one moment they said I don't make enough, and then a week later they denied me becauseI make too much. Well which is it? Then they say well maybe you should do a short sale, well I like my Real Estate and I want to keep it. Isn't this why I would try for a Mod in the first place? Seriously, it just doesn't make sense!

I want CHANGE in our Short Sale/Loan Mod/Foreclosure process, the bottom line... people like where they live and want to stay for the most part. They just don't want to pay on a loan that's more than what their home is worth. Any business would probably not continue to fund an investment that was 30% undervalue and not making up any ground.

This was about as simple as I could make it for now, please feel free to ask any questions :-)