San Diego & Riverside Counties| Real Estate Blog

Half of all homeowners foreclosured on, had no contact with lender

•  Industry estimates find that half of all homeowners who lose their homes to foreclosure have no contact with their loan servicers.  Homeowners at risk of default or those who already are behind on mortgage payments are advised to contact their servicer at the first sign of trouble.  Consumers should request to speak with someone in the home retention dept., and expect a long wait time. 

•  When working on a loan modification, short-sale, or repayment plan, servicers likely will ask the homeowner to explain the reasons they can no longer make their mortgage payments.  Borrowers should be honest and realistic.  The servicer also will need to verify the borrower’s current income, unemployment benefits (if any), household expenses, tax returns, property taxes, hazard and flood insurance premiums, and condo or HOA dues.

•  Whether the loan servicer requests it or not, borrowers should include a letter authorizing the servicer to speak with their REALTOR®, another family member, or perhaps their attorney, as this can help speed up the process.

At County Properties 23 years of brokerage experience and trust! We offer free counseling in real estate re; home values and information on options of selling vs Foreclosure.  If you have equity in your home, we will sell your home and get top dollar in this challenging market. If you do not have enough equity, and you must sell your property as a short sale we have the expertise to do so also. Please feel free to contact me today for free counseling at (619) 301-0200 or Toll free (866) 825-8124 visit our website, click  CountyProperties.net

 By the way…if you know of someone who would appreciate the level of service I provide, please call me with their name and business number and I’ll be happy to follow up and take great care of them.

Thinking of halting payments on house?

Some homeowners underwater on their houses—who owe more on their mortgages than their homes are worth—wonder what would happen if they were to stop paying their mortgages.  

When lenders do not receive payments, the first action taken by the lender is to report the missed payment to the credit bureaus by the first day of the next month.  Sometimes this can happen in as little as two weeks from the due date, depending on when the payment is due.  Generally, this action will leave a negative mark on a credit report and decrease the homeowner’s credit score by as much as 200 points.

Because of the negative mark on the homeowner’s credit report, within the next 30 days, homeowners can expect their other creditors to take note of the late payment and to take action.  Credit card issuers may raise interest rates, lower credit limits, or close credit card accounts.  The borrower’s auto insurance, student loans, and other forms of credit also may change, as these are tied to the borrower’s credit score as well.

If the homeowner does not pay for 90 days, the lender likely will start calling, trying to persuade the homeowner to enter into a loan modification.  If a loan modification cannot be agreed upon between the homeowner and the lender, and the homeowner continue missing payments, the homeowner likely will be served with a foreclosure notice.  After the foreclosure notice is received, the lender asks a court to issue a judgment against the homeowner, and a county sale is arranged.

Homeowners at risk of defaulting on their mortgages, or those who already are behind, should contact their lender immediately to work out a repayment plan and/or loan modification.  

 

At County Properties 23 years of brokerage experience and trust! We offer free counseling in real estate re; home values and information on options of selling vs Foreclosure.  If you have equity in your home, we will sell your home and get top dollar in this challenging market. If you do not have enough equity, and you must sell your property as a short sale we have the expertise to do so also. Please feel free to contact me today for free counseling at (619) 301-0200 or Toll free (866) 825-8124 visit our website, click  CountyProperties.net

By the way…if you know of someone who would appreciate the level of service I provide, please call me with their name and business number and I’ll be happy to follow up and take great care of them.

Short Sales, Foreclosures and Credit Repair

Q 1.  What is a "preforeclosure sale" is that the same as a short sale?

A  "A preforeclosure sale involves the sale of the property by the borrower to a third party for less than the amount owed to satify the delinquent mortgage, as agreed to by the lender, investor, and mortgage insurer" (Source:  FNMA Announcement 08-16, 6-25-08 ).

Although the terms preforeclosure sale and short sale have been used interchangeably, there is a significant difference for purposes of obtaining credit.  For Fannie Mae purposes, a preforeclosure assumes that the borrower has been delinquent in paying his or her mortgage and the lender agrees to accept a lesser amount to avoid the time and expense of a foreclousre action.  A short-sale, however, can also refer to situations in which the lender of the mortgage agrees to a payoff of a lesser amount than is actually owed, even on a current mortgage, to facilitate the sale of the property to a third party. (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )

Q 2.  If a borrower sold his or her property as a short sale but was never delinquent on that mortgage and is now attempting to purchase a new primary residence, will the borrower still get a loan?

A  The loan will be eligible provided that the borrower's previous mortgage history complies with lenders excessive prior mortgage delinquency policy--that is the borrower does not have one or more 60-, 90-, 120-, or 150-day delinquencies reported within the 12 months prior to the credit report date--and the borrower has not entered into any agreement with the short sale lender to repay any amounts associated with the short sale, including a deficiency judgment.  Different programs vary please contact our office at County Properties (866) 825-8124  or click.  CountyProperties.net

Q 3.  Are preforeclosure (short) sales and deed-in-lieu of foreclosure actions identified on a credit report?

A  Preforeclosure sales may be reported as "paid in full" with a "settled for less than owed" remarks code, and the mortgage tradeline would indicate any recent delinquency.  A deed-in-lieu may be reported by a remarks code indicating a deed-in-lieu. (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )

Q 4.  What is the difference between a Chapter 13 bankruptcy and a Chapter 7 bankruptcy?

A  Chapter 13 permits a borrower with a regular income to propose a plan to repay some or all of his or her obligations over a period of up to five years.  A borrower who files a Chapter 7 is permitted to retain exempt assets and receive a discharge of the borrower's debts.  Chapter 7 is a relatively quick liquidation process that is generally completed within 120 days.  Chapter 7 cases are rarely dismissed.  (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )

Q 5.  What is the difference between a Chapter 13 dismissal and a Chapter 13 discharge?

A  A borrower who files a Chapter 13 can dismiss the case at any time (voluntary dismissal) or the case may be dismissed by the court based on the borrower's failure to comply with the requirements of the Bankruptcy Code or to make the required payments. If the borrower who files a Chapter 13 case makes all of the payments required by the plan, the borrower receives a discharge at the end of the plan.  A borrower who doesn't make all the payment required by the plan may still receive a discharge if the court finds, among other things, that the borrower made a certain amount of the payments and the borrower's failure to make all of the payments was due to circumstances beyond the borrower's control.  (Source: FNMA Announcement 08-16 Q&A, 8-13-08. )

Q 6.  What are the requirements to re-establish a credit history?

A  After a bankruptcy or foreclosure-related action, a credit history must meet the following rquirements to be considered re-established:

^.  It must meet the requirements for elapsed time (as discussed in this article).

^.  It must reflect that all accounts are current as of the date of the mortgage application.

^.  it must include a minimum of four credit references.  At least one of the references must be a traditional credit reference, and one of the references must be housing-related.

(1) A housing-related reference must cover the period following the bankruptcy discharge or dismissal, foreclosure, or deed-in-lieu, and can be in the form of mortgage payments or rental payments.

(2) If rental payments wre not reported to the credit repositories, the lender must obtain copies of bank statements, money orders, or canceled checks for the most recent 12-month period as a supplement to the rent verification.

^.  It must reflect three of the four credit references, including rental housing references, as active in the 24 months preceding the date of the mortgage application.

^.  It must include no more than two installment or revolving debt payments 30 days past due in the last 24 months.

^.  It must include no installment or revolving debt payments 60 or more days past due since the discharge or dismissal of the bankruptcy or the completion of the foreclosure-related action.

^.  It must include no housing debt payments past due since the discharge or dismissal of the bankruptcy or the completion of the foreclosure-related action.

^.  It must include no new public records since the discharge or dismissal of the bankruptcy or the completion of the foreclousre-related action.  Public records include bankruptcies, foreclosures, deeds-in-lieu, preforeclosure sales, unpaid judgments or collections, garnishments, liens, etc.

(Source:  FNMA Selling Guide, 4-1-09 at 392. )

II.  Bankruptcy, Foreclosure, and Short Sale and the Impact on a FICO® Score

Q 7.  What is a FICO® Score?

A A FICO® score is a number representing the creditworthiness of a  person or the likelihood that person will pay his or her debts. The three credit reporting agencies, Equifax, Experian, and TransUnion, collect data about consumers in order to compile credit reports. The credit agencies use FICO® software to generate FICO® scores, which are then sold to lenders. Actually FICO® is just one of the several credit scoring systems available. The Fair Isaac Corporation (known as FICO®) created the first credit scoring system in 1958.  Others are NextGen, VantageScore, and the CE Score.  They all evaluate the creditworthiness of a borrower.  However, FICO appears to be the most-used credit scoring system.  A FICO® score is between 300 and 850.  The higher the better the credit.

Each consumer has three credit scores at any given time for any given scoring model because the three credit agencies have their own databases, gather reports from different creditors, and receive information from creditors at different times.

Q 8.  What factors go into determining a FICO® score?

A Credit scores are designed to measure the risk of default by taking into account various factors in a person's financial history. Although the exact formulas for calculating credit scores are closely-guarded secrets, FICO® has disclosed the following components and the approximate weighted contribution of each:

35% — Payment History – Late payments on bills, such as a mortgage, credit card or automobile loan, can cause a consumer’s FICO® score to drop. Paying bills as agreed over time will improve a consumer’s FICO® score.

30% — Credit Utilization - The ratio of current revolving debt (such as credit card balances) to the total available revolving credit (credit limits). Consumers can improve their FICO® scores by paying off debt and lowering their utilization ratio. The closing of existing revolving accounts will typically adversely affect this ratio and therefore have a negative impact on the FICO® score.

15% — Length of Credit History – As a consumer's credit history ages, assuming the consumer pays his or her bills, it can have a positive impact on the FICO® score.

10% — Types of Credit Used (installment, revolving, consumer finance) – Consumers can benefit by having a history of managing different types of credit.

10% — Recent search for credit and/or amount of credit obtained recently - Multiple credit inquiries for a consumer seeking to open new credit, such as credit cards, retail store accounts, and personal loans, can hurt an individual’s score. Applying for lots of new credit in a short period of time is also viewed as risky and can cause a drop in an individual’s score. However, individuals shopping for a mortgage or auto loan over a short period will likely not experience a decrease in their scores as a result of these types of inquiries.

(Source: http://www.myfico.com/CreditEducation/WhatsInYourScore.aspx) 
 

Q 9.  How does a mortgage modification affect my FICO® score?

A FICO® credit scores are calculated from the information in consumer credit reports. Whether a loan modification affects the borrower's FICO® score depends on whether and how the lender chooses to report the event to the credit bureau, as well as on the person's overall credit profile. If a lender indicates to a credit bureau that the consumer has not made payments on a mortgage as originally agreed, that information on the consumer's credit report could cause the consumer's FICO® score to decrease or it could have little to no impact on the score.

(Source: http://www.myfico.com/crediteducation/questions/Mortgage_Modification.aspx)  

Q 10.  How does a bankruptcy affect my FICO® score?

A  A bankruptcy is considered a very negative event regardless of the type. A bankruptcy is factored into your FICO® score until it is removed from your credit report.  As long as the bankruptcy is listed on your credit report, it will be factored into your score. If you are considering bankruptcy as an alternative to foreclosure, keep in mind that it may have a greater impact on your FICO® score.

Typically, you can expect bankruptcies to remain on your credit report, from the date filed, as follows:

(1)  Chapter 11 and Chapter 7 bankruptcies up to 10 years.

(2)  Completed Chapter 13 bankruptcies up to 7 years.

These time periods refer to the public record item associated with filing for bankruptcy. All of the individual accounts included in the bankruptcy should be removed from your credit report after 7 years.  (Source: http://www.myfico.com/crediteducation/Questions/Bankruptcy-Types.aspx)

If you plan to file a bankruptcy, here are some things you should do to make sure your creditors are accurately reporting the bankruptcy filing:

(1) Check your credit report to ensure that accounts that were not part of the bankruptcy filing are not being reported with a bankruptcy status. 
 

(2) Make sure your bankruptcy is removed as soon as it is eligible to be "purged" from your credit report.

After a bankruptcy has been filed, the sooner you begin re-establishing credit in good standing, the sooner you can expect your FICO® score to rebound. A good practice is to obtain a secured credit card and continually make all of your payments on time. As time passes and the impact of the bankruptcy lessens, you might apply for a traditional credit card and also continually make all of your payments on time.

(Source: http://www.myfico.com/crediteducation/questions/Bankruptcy-Reach.aspx) 

Q 11.  How does a short sale, deed-in-lieu-of foreclosure. or a foreclosure affect my FICO® score?

A  The alternatives to foreclosure, such as a deed-in-lieu of foreclosure or a short sale, aren’t any better as far as a FICO® score is concerned.

The common alternatives to foreclosure, such as short sales, and deeds-in-lieu of foreclosure are all "not paid as agreed" accounts, and considered the same by your FICO® score. This is not to say that these may not be better options for you from a financial or tax perspective, just that they will be considered no better or worse for your FICO® score.

If you are considering bankruptcy as an alternative to foreclosure, that may have a greater impact on your FICO® score. While a foreclosure is a single account that you default on,  declaring bankruptcy has the opportunity to affect multiple accounts and therefore has  potential to have a greater negative impact on your FICO® score.

(Source: http://www.myfico.com/CreditEducation/Questions/foreclosure-alternatives-fico-score.aspx)

Q 12.  What won't affect my FICO® score?

A The following information is not considered by the FICO® scoring formula:

^.  Your race, color, religion, national origin, sex, or marital status
^.  Your age
^.  Your salary, occupation, title, employer, date employed, or employment history
^.  Where you live
^.  Any interest rate being charged on a particular credit card or other account
^.  Certain types of inquiries (such as promotional, account review, insurance or employment-related inquiries)
^.  Credit counseling
^.  Any information not found in your credit report
^.  Any information that is not proven to be predictive of future credit performance

At County Properties 23 years of brokerage experience and trust! We offer free counseling in real estate re; home values and information on options of selling vs Foreclosure.  If you have equity in your home, we will sell your home and get top dollar in this challenging market. If you do not have enough equity, and you must sell your property as a short sale we have the expertise to do so also. Please feel free to contact me today for free counseling at (619) 301-0200 or Toll free (866) 825-8124 visit our website, click  CountyProperties.net

 

By the way…if you know of someone who would appreciate the level of service I provide, please call me with their name and business number and I’ll be happy to follow up and take great care of them.

Inland foreclosure rate decreases

Inland foreclosure rate decreases but is sixth-highest in U.S.

With one foreclosure-related filing for every 30 homes, the Riverside-San Bernardino-Ontario market had the sixth-highest foreclosure rate in the nation in the third quarter of this year, according to a report released Tuesday.

Inland Southern California saw 48,416 combined filings for defaults, trustee sales and bank repossessions in the third quarter, which was a decline of almost 8 percent from the second quarter but up almost 12 percent from the third quarter of 2008.

RealtyTrac spokesman Daren Blomquist said the quarter-to-quarter decline in foreclosure activity in Riverside and San Bernardino counties does not reflect lessened distress among homeowners but instead reflects the foreclosure-prevention efforts launched this year by the state and federal government and the lending industry.

"We are seeing trends we wouldn't expect given the delinquency rates and continued problems with unemployment," Blomquist said.

He noted that more than 500,000 problem mortgages have been put into trial modification programs under the Obama Administration's Making Home Affordable Program. Blomquist said time will tell whether those trial modifications will become permanent and borrowers will remain current on their mortgage payments for the long term.

The region has ranked as high as fourth nationally in quarterly foreclosure filings.

While foreclosure activity in this region was greater than a year ago, RealtyTrac, an Irvine online foreclosure marketing company, reported that foreclosures have decreased year-to-year in some hard-hit areas of the country and increased sharply in others.

At County Properties 23 years of brokerage experience and trust! We offer free counseling in real estate re; home values and information on options of selling vs Foreclosure.  If you have equity in your home, we will sell your home and get top dollar in this challenging market. If you do not have enough equity, and you must sell your property as a short sale we have the expertise to do so also. Please feel free to contact me today for free counseling at our website, click.  County Properties San Diego or County Properties Riverside

 

By the way…if you know of someone who would appreciate the level of service I provide, please call me with their name and business number and I’ll be happy to follow up and take great care of them.

 

Housing bottom behind us, experts say

The median price of an existing, single-family home in California rose for the seventh consecutive month in September to $296,090, according to the CALIFORNIA ASSOCIATION OF REALTORS®’ most-recent sales and price report.  Home sales also increased in September, rising 2.1 percent compared with August.  If home sales maintain their current pace, 530,520 units will be sold in California in 2009.
 
MAKING SENSE OF THE STORY FOR CONSUMERS
 
•    The market’s momentum continued in September, as many home buyers took advantage of the federal tax credit for first-time home buyers.  The success of the federal tax credit is clear.  Nearly 70 percent of first-time home buyers report that the tax credit was ‘the most important’ or a ‘very important’ factor in their decision to buy a home.
 
•    C.A.R. is calling for the U.S. Senate to swiftly adopt the Dodd-Lieberman-Isakson amendment, which would extend the federal tax credit through June 30, 2010, remove the first-time buyer requirement and extend the credit to all home buyers, and increase the qualifying income limits so more families are eligible for the credit.
 
•    A new milestone was reached in September, when five C.A.R. regions reported positive year-to-year increases in the median price, the first such increase since January 2008.  September also marked the first single-digit decline in the year-to-year median price since October 2007, after 22 consecutive months of double-digit decreases, leading many to believe the state’s median prices are leveling out.
 
•    C.A.R.’s Unsold Inventory Index for existing, single-family detached homes in September 2009 was 4.2 months, compared with 6.5 months for the same period a year ago. The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate.
 
•   Thirty-year fixed-mortgage interest rates averaged 5.06 percent during September 2009, compared with 6.04 percent in September 2008, according to Freddie Mac. Adjustable-mortgage interest rates averaged 4.59 percent in September 2009, compared with 5.14 percent in September 2008.

At County Properties 23 years of brokerage experience and trust! We offer free counseling in real estate re; home values and information on options of selling vs Foreclosure.  If you have equity in your home, we will sell your home and get top dollar in this challenging market. If you do not have enough equity, and you must sell your property as a short sale we have the expertise to do so also. Please feel free to contact me today for free counseling at our website, click.  County Properties San Diego or County Properties Riverside

 

By the way…if you know of someone who would appreciate the level of service I provide, please call me with their name and business number and I’ll be happy to follow up and take great care of them.

Fewer short sales are coming up short

That transaction, in which borrowers sell their house for less than they owe, has earned a reputation as a frustrating morass with banks taking weeks or months to respond to offers and then often rejecting them. Because lenders swallow a loss on short sales, they have the ultimate say.

But now real estate professionals and banks say the logjam is starting to ease, with decisions coming more quickly, more short sales trading hands, and the prospect of a new Treasury plan that will further lubricate the process.

For homeowners, a short sale provides a more dignified transition than a foreclosure - and will allow them to return to homeownership sooner. Fannie Mae, for instance, requires at least a five-year wait after a foreclosure but only two years after a short sale - and less if the homeowner wasn't delinquent.

Short sales are also better for the neighborhood because the home stays occupied instead of becoming a vacant foreclosure that may attract crime. And for banks, short sales let them skip the expense and time of going to foreclosure.

Several developments are helping to expedite the sales:

-- Pre-approval. Some banks are proactively deciding what amount they will accept for a short sale house. Sometimes they reveal the amount; sometimes they don't, but either way it expedites the process. Homes with this arrangement are listed as "Lender pre-approved short sale."

"It's an internal reserve price that lets us know the floor we'll accept on a short sale," said Dave Sunlin, senior vice president for foreclosures and real estate at Bank of America, which doesn't reveal the price for competitive reasons.

Considering options
At Wells Fargo, Ben Windust, senior vice president of default operations, said the bank is testing various short-sale approaches, including pre-approved sale amounts that it does reveal. That pilot is only for homes that Wells owns in its portfolio; homes owned by investors require more complex decision-making.

-- Proactive discussion with homeowners. Windust said another Wells pilot is to monitor real estate listings. "If we see we have a (Wells Fargo) borrower who listed property, if it's underwater, we might proactively reach out to them to work with us now on a short sale."

Similarly, JPMorgan Chase spokesman Gary Kishner said, "We are working on a more proactive approach to short sales by obtaining a listing of our delinquent borrowers who have their property listed for sale and then reaching out to help them sell the property."

Wells, Chase and other banks said it benefits homeowners to let their banks know early on that they want to pursue a short sale so the home's value, paperwork stream and other factors can be determined.

-- Treasury plan. In May the Treasury Department said it would offer a streamlined framework for short sales and incentive payments of $1,500 to homeowners, $1,000 to loan servicers and $1,000 to second-lien holders. That plan is supposed to be implemented very soon.

"As we understand it, it allows lenders to work with borrowers to mutually agree on how to market the property, set the price for it, gives us a fixed amount of time to sell the property and if not, converts it into a deed in lieu of foreclosure," said BofA's Sunlin.

But despite the progress, many short sales are still exasperating.

At County Properties 23 years of brokerage experience and trust! We offer free counseling in real estate re; home values and information on options of selling vs Foreclosure.  If you have equity in your home, we will sell your home and get top dollar in this challenging market. If you do not have enough equity, and you must sell your property as a short sale we have the expertise to do so also. Please feel free to contact me today for free counseling at our website, click.  County Properties San Diego or County Properties Riverside

 

By the way…if you know of someone who would appreciate the level of service I provide, please call me with their name and business number and I’ll be happy to follow up and take great care of them.

OBAMA ADMINISTRATION ANNOUNCES $60 MILLION IN HOUSING COUNSELING GRANTS

OBAMA ADMINISTRATION ANNOUNCES $60 MILLION IN HOUSING COUNSELING GRANTS TO NEARLY 500 NATIONAL, STATE AND LOCAL AGENCIES

HUD to provide $60 million in housing counseling grants

The U.S. Dept. of Housing and Urban Development (HUD) announced this week it will issue $60 million in housing and counseling training grants to assist families in becoming first-time homeowners and remaining homeowners after their purchase.

Grant recipients will help home buyers and homeowners realistically evaluate their readiness for a home purchase, understand their financing and down payment options, and navigate the home-buying process.  Recipients also will offer foreclosure-prevention counseling to current homeowners.

 

Neighborhood House Association

San Diego, CA

The Neighborhood House Association has been a HUD-approved counseling agency since 1973 and has provided housing counseling services for over 36 years. NHA‘s Housing Counseling program provides homebuyer education, and pre-purchase, delinquency/default, non delinquency post purchase, rental, and reverse mortgage (HECM) counseling. NHA has a primary focus on a variety of one-on-one counseling services. NHA‘s staff is culturally diverse and has the capacity to serve both English and Spanish speaking clients. NHA concentrates services to minority and bilingual clients throughout San Diego County, including those that have been victimized in the current housing market. For additional information, the Neighborhood House Association‘s website address is: http://www.neighborhoodhouse.org

Springboard Non Profit Consumer Credit Management Inc

Riverside, CA

Springboard was founded in 1974 with a mission to help strengthen communities and improve the lives of Americans by offering consumer credit counseling services that promote financial literacy, homeownership and a healthy economy. As a HUD approved Multi-State Organization, Springboard offers quality bilingual services at locations throughout Southern

California, the Central Valley, Arizona and Nevada. Springboard provides credit counseling, debt consolidation/bankruptcy counseling, homebuyer education, loan document review, reverse mortgage, and mortgage default/delinquency counseling. For additional information about Springboard and the services they offer, visit: www.credit.org

At County Properties 23 years of brokerage experience and trust! We offer free counseling in real estate re; home values and information on options of selling vs Foreclosure.  If you have equity in your home, we will sell your home and get top dollar in this challenging market. If you do not have enough equity, and you must sell your property as a short sale we have the expertise to do so also. Please feel free to contact me today for free counseling at our website, click.  County Properties San Diego or County Properties Riverside

By the way…if you know of someone who would appreciate the level of service I provide, please call me with their name and business number and I’ll be happy to follow up and take great care of them.

List my home Short Sale and Buy Home Program

Short Sell your existing home,
and then Buy your next home concurrently!

Get a nicer House, for Less Money, and not have to move into a Rental or Apartment !

Get a FREE No Obligation Short Sale Pre-Qualification Your Information will be held in our strictest confidence. See our PRIVACY POLICY for details

Click here for Short Sale and Buy Program

YES WE CAN offer you the ability to Short Sale your existing upside down home, and then simultaneously buy a similar home at today's super low values.  The Short Sales ASAP group has teamed up with one of San Diego's leading mortgage lenders to offer southern California homeowners this exciting Short Sale and Buy program, utilizing the Federal Housing Authority (FHA) 4155 loan program.

According to 1st American Core Logic, in Los Angeles County there are over 650,000 homeowners who have negative equity (upside down) in their home, and in San Diego & Riverside Counties, the estimates are over 300,000 property owners have no equity. For homeowners who are upside down, the are several options to choose from as follows:

1. Do Nothing: Keep Paying current mortgage for the next 8 to 12 years until break even.
2. Loan Modification: Maybe lower payments, but with the same high mortgage loan balance.  reposts show that only 25% of Loan Mod applications are granted.
3. Foreclosure: Stop making payments, eviction from home, ruined credit and loan worthiness, and become a renter for the next 5 to 7 years.
4. Short Sale and Buy Plan:  Short Sale existing home and thus eliminate all negative debt, and then simultaneously buy a similar replacement home at today's low property values. 

Short Sale	and	Buy.
$650,000 Purchase in 2005'. Valued at $350,000 Today.		$375,000 Purchase in 2009' with 3.5% Down Payment.

Click here for Short Sale and Buy Program

Below is a list of some of the more common qualifying Guidelines for the Short Sale and Buy plan utilizing the FHA 4155 loan program (terms and conditions are subject to change):

• Purchase Loan Limits are $729,750 for San Diego & Riverside Counties.
• Down Payment as low as 3.5% of the new Purchase Price, and Gifts are OK.
• No Income Limits.
• Competitive FHA lending interest rates.
• Purchase price of replacement home must be less then original Loan Balance's of house being Short Sold.

Short Sale and Buy Questions and Answers. 

What is a Short Sale ? Simply put, a Short Sale occurs when a homes market value is less then the outstanding mortgage debt plus sales costs (sometimes called an upside down Mortgage. In order for a Short Sale to actually close, the mortgage bank's must agree to write-off a portion of the outstanding loan debt.

How does a Typical Short Sale and Buy transaction Work? For example, let's look at a typical home that has $500,000 in mortgage debt, but is now worth only $375,000 in today's market.  We market and sell this home for $365,000, and we also negotiate with the Bank's to reduce their loan balances to a value a little less than that, in order to pay closing costs, back taxes and other costs.  This is called a Short Sale.  Simultaneously, the property Seller works with the Mortgage Lender to qualify for the Short Sale and Buy Program.  Once approved, we help the property owner find and purchase a similar replacement home at today's bargain values.  The replacement property must be priced less then the $500,000 that is currently owned on this example short sale property. Once everything is approved and processed, we close escrow on the short sale home, and simultaneously close on the replacement home the very next day.  The past mortgage debts are eliminated and now your are living in a home that you own with positive equity. 

Click here for Short Sale and Buy Program

Why Would a Mortgage Bank Consider a Short Sale ? Lenders often entertain such an option for in the long run, they will usually receive a higher percentage of their principal back as compared to forcing the property into Foreclosure. In a Foreclosure, the Mortgage Bank runs the risk of property neglect or damage, and additional delays and costs, and other market losses.

Today, most California lenders won't commit to a Short Sale until their is a valid and firm purchase offer in hand from a qualified new buyer, and a knowledgeable broker/agent who can negotiate the deal. It's imperative to work with an experienced real estate broker for they will need to prepare a professional and complete Short Sale package.

Why Do Mortgage Banks allow a Short Seller to Buy a Replacement Home ?  The Federal Government has injected Billions of dollars of capital in the financial markets via TARP and other programs.  A larger portion of these funds are earmarked for mortgage banking and real estate.  A significant portion of these funds are being supplied to FHA programs such as the FHA 4155.  Recent studies have shown that many Loan Modification programs are not working for many homeowners, and Banks and the Feds are pulling out the stops to curb the level of Foreclosures.  Hence, the reason and motivation for the new Short Sell and Buy Program.

How is a Short Sale Negotiated with a Mortgage Bank? Short Sales are one of the most difficult and complicated residential transactions. Compared to a normal sale, these transactions require additional paperwork, intricate negotiations with the mortgage banker's, and careful preparation of the process and purchase offer. A Short Sale package typically includes: a purchase offer contract, buyers loan qualifications, a realistic and detailed analysis of the fair market value of the home, current local real estate market conditions, seller financial information, seller hardship letter and more.

Basically, the Short Sale real estate professional must demonstrate to the mortgage bank's that the home is upside down, the purchase offer is fair and just, and the homeowner has a financial hardship worthy of a short sale. This financial hardship can be due to job layoffs, illnesses, divorce, or even the unexpected large increase in mortgage payments due to interest rate resets.

What is the Reason for the large number Short Sales in the SoCal Real Estate Market ? Today, the upside down Mortgages in California are due mostly to the risky, highly leveraged loans that were extensively used over the past 7 years to purchase homes with little or nothing down. Worse yet, many of these loans were adjustable rate loans, or negative amortization loans in which the loan balance gets higher every month.

In addition, southern California home prices have decreased by as much as 35% to 45% in some areas. These factors are causing many home owners to consider a Short Sale to solve their financial crisis. The result is, there are 1,000's upon 1,000's of southern California homeowners who are upside down on their mortgage loan by then of thousands of dollars, and can no longer afford their mortgage payment.

Do I need a Real Estate Professional to Conduct my Short Sale ? Although, it is theoretically possible to conduct your own Short Sale (ie: Do-It-Yourself), we strongly recommend that you do not. Here is why: 1.) Our Services effectively cost you nothing... Need I say more ?... but I will. We Negotiate our fee's with the Mortgage Banks, and we do not charge any type of up front fee's (be very wary of anyone who wants to charge an upfront fee by the way).

Why should I work with County Properties? We are glad you are thinking about this question... The Association of Realtors recently conducted a statewide survey which reported that only 10% of all Short Sales actually closed escrow !!! That's terrible.. the Great News is our Short Sale closing Rate is better then 90%. How you may ask ?... Experience - Education - Tough Bank Negotiations - Dogged Persistence. Our team consists of Bank Negotiators, a Real Estate & Internet Marketing expert, Listing and Sales experts, and Transaction Coordinators. Our team experience goes back to the mid 1990's when southern California experienced it's last major real estate down turn.

Please give is a call TODAY, so we can begin to help you TOMORROW. Call us at: (619) 301-0200 or Toll free (866) 825-8124 we are easy to talk too.

We'll keep the conversation and your situation in our strict confidence. If you prefer, please feel free to contact me by clicking here Short Sale and Buy Program

We'll keep the conversation and you’re pending Foreclosure in strict confidence.

Banks bite bullet on loan modifications

A new report from the Office of the Comptroller of the Currency and the Office of Thrift Supervision shows that the portion of loan modifications in the second quarter that involved reducing the principal increased to 10 percent from 3.1 percent in the first quarter.

While strategies such as lowering interest rates or extending mortgage terms can temporarily help borrowers struggling to make payments, reports show that often times borrowers re-default because the modifications do not lower payments to a truly affordable level.  Of loans modified in the first quarter of 2009, 28 percent were in default again within three months, according to the Office of the Comptroller of the Currency.  Among those modified in last year’s second quarter, 56 percent were in default again a year later.

Banks are beginning to reduce mortgage principal due, in part, to prodding from the Obama administration, whose housing plan includes financial incentives for mortgage-servicing firms that modify loans.  At the same time, banks now have more flexibility to modify loans because of their success in stabilizing their balance sheets and, in some cases, raising fresh capital.

At County Properties 23 years of brokerage experience and trust! We offer free counseling in real estate re; home values and information on options of selling vs Foreclosure.  If you have equity in your home, we will sell your home and get top dollar in this challenging market. If you do not have enough equity, and you must sell your property as a short sale we have the expertise to do so also. Please feel free to contact me today for free counseling at our website, click. County Properties San Diego or County Properties Riverside

By the way…if you know of someone who would appreciate the level of service I provide, please call me with their name and business number and I’ll be happy to follow up and take great care of them.

2010 CA Housing Market Forecast released

The median home price in California will rise 3.3 percent to $280,000 in 2010 compared with a projected median of $271,000 this year, according to C.A.R.’s "2010 California Housing Market Forecast," presented today at CALIFORNIA REALTOR® EXPO 2009 in San Jose. Sales for 2010 are projected to decrease 2.3 percent to 527,500 units, compared with 540,000 units (projected) in 2009.

“California’s housing market continued its strong sales rebound this year, resulting from the continued pace of distressed properties coming to market,” said C.A.R. President James Liptak.  “This follows two years of double-digit sales declines in 2006 and 2007.  Looking ahead, we expect sales to moderate to a more sustainable pace.” 

“After experiencing its sharpest decline in history, we expect the median price to rise modestly next year,” Liptak added.  “2010 will mark the beginning of the ‘new normal’ for California’s housing market.  This ‘new normal’ likely will feature a steady stream of sales driven by distressed properties in the low end of the market, coupled with moderate home-price appreciation.”

 “With distressed properties accounting for nearly one-third of the sales in 2010, inventory will be relatively lean, under six months during the off-season months, and a roughly four-month supply during the peak season,” said C.A.R. and Vice President Leslie Appleton-Young.  “We expect the median price to decrease slightly through the remainder of 2009 and into next year, then rise before leveling off next summer.  For the year as a whole, home prices are forecast to reach $280,000. The wild cards for 2010 include foreclosures, loan resets, the labor market, and the California budget crisis, as well as the actions of the federal government.”

If you would like to get loan information from recommended banks, or get started and view all homes, condos, investment properties, pre-foreclosures, bank owned foreclosures (REO's) or thinking of selling your property, please visit our website at: County Properties San Diego or County Properties Riverside County Properties San Diego or County Properties Riverside

By the way…if you know of someone who would appreciate the level of service I provide, please call me with their name and business number and I’ll be happy to follow up and take great care of them.