Friday, September 7, 2012
New Blog Series
Think short sales are fascinating? Think you want to know more? Or just have nothing else to do on a Saturday night? I am going to start what will equate to a journal for each of my short sales as I start them. There will be details about the calls to the banks, the resubmission of paperwork, all that fun stuff. There will, of course, be no details disclosed about the parties involved. Names and addresses will be changed to protect the innocent.
Next step...........I have to actually figure out how to make a new blog....anyone?
Wednesday, April 25, 2012
Anyone Notice a Swift Change in the Market?
Anyone else notice something neat happening or is it just me?
Here is what I am noticing. Homes are selling very fast and frequently with multiple offers. We are seeing homes selling in less than 60 days. But...days on market for active listings is still very high. The overpriced listings are hanging around too long and then there are the dregs. You know, terribly distressed properties which require cash or a rehab loan. But outside of those two examples, homes are selling very quickly. A well priced home able to be financed should be no problem to sell in today's market. Buyers are out there and rates are still fantastic.
Sunday, November 20, 2011
Foreclosure fears foster true grief
Reports of foreclosures by the millions have been in the news so much over the past few years that to some, it might seem like the new normal.
But as a real estate professional who is in the trenches with financially stressed homeowners every day, it never for a second feels to me like business-as-usual.
The prospect of losing ones home is right up there among the major sources of grief, and often, it goes hand in hand with other tragic setbacks such as the loss of a job, a divorce, death of a loved one, mounting medical bills or skyrocketing mortgage payments.
Unfortunately, the first stage of grief is denial, and that’s even more the case when the threat of foreclosure is looming. No one wants to talk about or admit financial troubles—even when millions of others have founds themselves in a similar spot. It’s completely understandable, but for homeowners who are behind on mortgage payments, decisive action is often the most critical step toward ensuring the best possible solution.
I help homeowners to deal with every aspect of the grief and uncertainty that accompanies a mortgage which is no longer manageable. In the process, I help them to get on a path of financial solvency.
If you or someone you care about would like to change the course of a life that’s facing foreclosure, I get it and I can help.
Contact me today at 541-606-2954 or tara.nagelhout (at) gmail.com
But as a real estate professional who is in the trenches with financially stressed homeowners every day, it never for a second feels to me like business-as-usual.
The prospect of losing ones home is right up there among the major sources of grief, and often, it goes hand in hand with other tragic setbacks such as the loss of a job, a divorce, death of a loved one, mounting medical bills or skyrocketing mortgage payments.
Unfortunately, the first stage of grief is denial, and that’s even more the case when the threat of foreclosure is looming. No one wants to talk about or admit financial troubles—even when millions of others have founds themselves in a similar spot. It’s completely understandable, but for homeowners who are behind on mortgage payments, decisive action is often the most critical step toward ensuring the best possible solution.
I help homeowners to deal with every aspect of the grief and uncertainty that accompanies a mortgage which is no longer manageable. In the process, I help them to get on a path of financial solvency.
If you or someone you care about would like to change the course of a life that’s facing foreclosure, I get it and I can help.
Contact me today at 541-606-2954 or tara.nagelhout (at) gmail.com
Monday, August 15, 2011
The F Word........FRAUD
Fraud comes in all shapes and sizes, and fraud in the real estate world is no different. From inflating income to obtain loans, to falsifying documents to get rid of a house via short sale, fraud knows no boundaries. At national levels, mortgage fraud risk has declined 2.3 percent over the year.* Interthinx’s nongeographic fraud risk analysis found that investor loans are riskier than owner-occupant loans with three times the risk of employment/income fraud. The report also concluded that as the loan amount increased, so did the risk of occupancy or employment/income fraud. Oregon ranks at number 15 for mortgage fraud risk. Salem, Oregon received the highest fraud risk rating, "very high" as did Atlanta, Memphis, and pretty much all of southern California.
What does mortgage look like at the beginning of a loan? Buyers find themselves falsifying their financial information to obtain a loan when they would be otherwise ineligible. With stated incomes being a fossil of the housing boom, it isn't as easy to falsify income and it is a lot more bold these days. Income fraud is seen in traditional full documentation loans by forging or altering an employer issued W-2, tax returns, or bank statements. WOW! That is bold! There are the rare occurances of the loan broker falsifying the borrower's documents in order to facilitate the closing in order to "earn" their commission. Again, very bold and very stupid. According to CoreLogic, over $10,000,000,000 (yep...that is a ten billion) in loans were made with fraudulent application data in 2010 alone!
Occupancy fraud is another method which remains popular. This is when a buyer states they will be living in the property when in fact it is being purchase as an investment. You might wonder why anyone would do that? Well, interest rates for investment properties are significantly higher and require significantly larger down payments than owner occupied properties. That answer is pretty simple. And you might wonder why it matters? Lenders are well aware that a borrower will take all measures to protect the property he/she lives in. The owner's “attachment” to the property is just as emotional as it is financial. In the case of a non-owner occupied home, the emotional attachment does not exist, or at least is not as strong. Because of this lenders require a higher interest rate to offset the potential they have for loss.
Appraisal fraud is when the home's value is deliberately over or understated. When it is over stated, more money can be obtained by the borrower from the lender for a cash-out refinance, or more funds going to the seller in a purchase transaction, or in a fully blown fraud for profit scheme to the organizers. Inflating the value is easy to understand, but why would anyone deliberately understate the value of a home? On the purchase side again, in order to get a lower price for a foreclosed property. Some foreclosed properties have the appraisals completed prior to being put on the market. I dishonest appraiser may be involved in the preparation but there could also be somebody on the other end who is editing it with graphic editing tools. Devaluing property for the purpose of a loan modification or short sale is a whole second article, so come back in two weeks and we will find out all about it. Fraudsters can be very bold and with the prevalence of mortgage fraud and the limited capacity of the government to watch and detect, they are getting away with it. I always wonder, if these seemingly creative and clever people would use their powers for good instead of fraud, how much better would this country be?
What does mortgage look like at the beginning of a loan? Buyers find themselves falsifying their financial information to obtain a loan when they would be otherwise ineligible. With stated incomes being a fossil of the housing boom, it isn't as easy to falsify income and it is a lot more bold these days. Income fraud is seen in traditional full documentation loans by forging or altering an employer issued W-2, tax returns, or bank statements. WOW! That is bold! There are the rare occurances of the loan broker falsifying the borrower's documents in order to facilitate the closing in order to "earn" their commission. Again, very bold and very stupid. According to CoreLogic, over $10,000,000,000 (yep...that is a ten billion) in loans were made with fraudulent application data in 2010 alone!
Occupancy fraud is another method which remains popular. This is when a buyer states they will be living in the property when in fact it is being purchase as an investment. You might wonder why anyone would do that? Well, interest rates for investment properties are significantly higher and require significantly larger down payments than owner occupied properties. That answer is pretty simple. And you might wonder why it matters? Lenders are well aware that a borrower will take all measures to protect the property he/she lives in. The owner's “attachment” to the property is just as emotional as it is financial. In the case of a non-owner occupied home, the emotional attachment does not exist, or at least is not as strong. Because of this lenders require a higher interest rate to offset the potential they have for loss.
Appraisal fraud is when the home's value is deliberately over or understated. When it is over stated, more money can be obtained by the borrower from the lender for a cash-out refinance, or more funds going to the seller in a purchase transaction, or in a fully blown fraud for profit scheme to the organizers. Inflating the value is easy to understand, but why would anyone deliberately understate the value of a home? On the purchase side again, in order to get a lower price for a foreclosed property. Some foreclosed properties have the appraisals completed prior to being put on the market. I dishonest appraiser may be involved in the preparation but there could also be somebody on the other end who is editing it with graphic editing tools. Devaluing property for the purpose of a loan modification or short sale is a whole second article, so come back in two weeks and we will find out all about it. Fraudsters can be very bold and with the prevalence of mortgage fraud and the limited capacity of the government to watch and detect, they are getting away with it. I always wonder, if these seemingly creative and clever people would use their powers for good instead of fraud, how much better would this country be?
Monday, July 25, 2011
To Short or Not to Short...part 3
After all the conflicting information we hear about short sales and their impact on credit scores you are probably wondering what you should do. When working with a distressed homeowner the first question I like to ask is "What do you want?". While this may seem like a very open ended question, it isn't. Most people know what I am asking and are able to answer fairly quickly. While some may respond with "I want to keep my home, I just need a payment I can handle" others quickly jump to "I just want this over and want to move on with my life.". There is a wide range of answers in between as well.
One consistent requirement for your servicer to agree to a short sale is a valid hardship. They need to see why you need to sell your home. And here's the thing, the fact that your house is worth less than you owe is not a hardship. I know, that might not be what you want to hear, but a lack of equity was not the intent when these programs were set up. What is a hardship? Loss of job, death of a spouse, medical bills, necessary relocation, and other similar life changing events.
You may also hear stories of the bank "forcing" 30 day lates in order to allow the short sale. While in most cases a servicer will not allow a short sale without the payments being late, the intended purpose again, is that if you can make your payment, you should. If you can't then you can't.
Foreclosures, short sales and being delinquent have become almost mainstream. The stigma once attached is rapidly diminishing and what was once a private matter most people would prefer to hide is now becoming nearly a badge of honor to be worn with pride. The result? A continuous snowball of distressed properties, each one contributing to lower neighborhood property values. While there are true hardships and people who honestly need to sell their homes, there are also many cases of owners who just simply don't want to pay on a home which is underwater, from an equity point of view. The problem is that with each short sale or foreclosure the surrounding home values decline and decline, and then decline some more.
In a normal fair market sale, a seller will work as hard as possible to obtain the highest sales price. Why? Because the higher the selling price, the more money in their pocket. When it comes to the point that the seller will be receiving no funds from the transaction their motivation to get the highest price possible is removed from the equation. We see sellers accepting virtually any offer because they just don't care. But they should care. Another $5,000 or $10,000 not only decreases the loss the investor absorbs, but it also helps to maintain property values of the surrounding homes. The game should not be to get any offer as fast as you can, but to get the highest and best offer you can.
The answer is never clear and each person is different. But if you can make your payment, do it. Your credit score will thank you, your future ability to buy a home with thank you, and your neighbors will really thank you. If you can't, consult a Realtor, do your best to sell the property for the highest possible value.
One consistent requirement for your servicer to agree to a short sale is a valid hardship. They need to see why you need to sell your home. And here's the thing, the fact that your house is worth less than you owe is not a hardship. I know, that might not be what you want to hear, but a lack of equity was not the intent when these programs were set up. What is a hardship? Loss of job, death of a spouse, medical bills, necessary relocation, and other similar life changing events.
You may also hear stories of the bank "forcing" 30 day lates in order to allow the short sale. While in most cases a servicer will not allow a short sale without the payments being late, the intended purpose again, is that if you can make your payment, you should. If you can't then you can't.
Foreclosures, short sales and being delinquent have become almost mainstream. The stigma once attached is rapidly diminishing and what was once a private matter most people would prefer to hide is now becoming nearly a badge of honor to be worn with pride. The result? A continuous snowball of distressed properties, each one contributing to lower neighborhood property values. While there are true hardships and people who honestly need to sell their homes, there are also many cases of owners who just simply don't want to pay on a home which is underwater, from an equity point of view. The problem is that with each short sale or foreclosure the surrounding home values decline and decline, and then decline some more.
In a normal fair market sale, a seller will work as hard as possible to obtain the highest sales price. Why? Because the higher the selling price, the more money in their pocket. When it comes to the point that the seller will be receiving no funds from the transaction their motivation to get the highest price possible is removed from the equation. We see sellers accepting virtually any offer because they just don't care. But they should care. Another $5,000 or $10,000 not only decreases the loss the investor absorbs, but it also helps to maintain property values of the surrounding homes. The game should not be to get any offer as fast as you can, but to get the highest and best offer you can.
The answer is never clear and each person is different. But if you can make your payment, do it. Your credit score will thank you, your future ability to buy a home with thank you, and your neighbors will really thank you. If you can't, consult a Realtor, do your best to sell the property for the highest possible value.
Monday, July 11, 2011
To short or Not to Short....part 2
One common belief is that a short sale is better on your credit report than a foreclosure. While a foreclosure on your credit report is terrible, a short sale may be just as damaging as a foreclosure to the seller's credit or credit rating. Both FICO and VantageScore have release recent studies that show "For anyone, a short sale can be almost as destructive as a foreclosure." FICO looked at how a short sale or foreclosure would affect three hypothetical mortgage holders: One with a 780 score; another with 720, who may have; and a third with a 680. In a short sale, assuming that the lender or servicer has waived the right to collect the difference between the amount owed and the amount paid, the 780 score drops to between 675 to 655; the 720 score drops to between 625 to 605; and the 680 score drops to between 630 to 610.
The biggest impact on a mortgage holder's credit score is missed monthly mortgage payments. If a person with a credit rating of 780 is 30 days late, the score drops as if a short sale has occurred (690 to 670). The same is true for the person with a 720 score (650 to 630) and a person with a 680 score (620 to 600). Thus, a short sale or foreclosure has almost the same credit rating effect if the seller is behind on the monthly mortgage payments.
Belief #2: The bank will not pursue a deficiency judgment. While some lenders clearly disclose in their short sale approval letters that a deficiency will not be pursued, others are less blatant. I have heard Realtors say "Oh, don't worry, they say they can come after you for the remaining balance but they never do.". Well.....the lenders might not be coming to collect the remaining balances right now, but right now they are quite busy. What happens when they no longer have all these short sales to process and their employees need something to do? Well, my bet is all those sellers who didn't have a very clear release of money owed will be hearing from some agressive collection agencies. These collection agencies will buy up these old debts for pennies on the dollar and will do all they can to collect the remaining balances. Debtors will have a choice of paying the debt in full, possibly settling the debt, or filing bankruptcy.
Belief #3: You won't be taxed on the amount of debt forgiven. The Mortgage Forgiveness Debt Relief Act does provide for sellers to not be taxed on the debt forgiven, there are certain qualifications which must be met. The first is that the home must be the debtors primary residence. This means a seller can't short sale a rental property and claim the forgiveness. Second, the debt forgiven must be from purchase money or a non cash out refinance. In other words, if you took out an equity loan to buy a boat or pay of credit card debt, you will be taxed on the amount forgiven.
Come back in 2 weeks for part 3 of To Short or Not to Short.
Important legal disclaimer: I am a Realtor with a lot of knowledge and experience on my side. I am not a lawyer or an accountant. As such, for legal or tax advise you should consult a professional in that field. This article is a collection of my opinions and should not be considered legal or tax advice.
The biggest impact on a mortgage holder's credit score is missed monthly mortgage payments. If a person with a credit rating of 780 is 30 days late, the score drops as if a short sale has occurred (690 to 670). The same is true for the person with a 720 score (650 to 630) and a person with a 680 score (620 to 600). Thus, a short sale or foreclosure has almost the same credit rating effect if the seller is behind on the monthly mortgage payments.
Belief #2: The bank will not pursue a deficiency judgment. While some lenders clearly disclose in their short sale approval letters that a deficiency will not be pursued, others are less blatant. I have heard Realtors say "Oh, don't worry, they say they can come after you for the remaining balance but they never do.". Well.....the lenders might not be coming to collect the remaining balances right now, but right now they are quite busy. What happens when they no longer have all these short sales to process and their employees need something to do? Well, my bet is all those sellers who didn't have a very clear release of money owed will be hearing from some agressive collection agencies. These collection agencies will buy up these old debts for pennies on the dollar and will do all they can to collect the remaining balances. Debtors will have a choice of paying the debt in full, possibly settling the debt, or filing bankruptcy.
Belief #3: You won't be taxed on the amount of debt forgiven. The Mortgage Forgiveness Debt Relief Act does provide for sellers to not be taxed on the debt forgiven, there are certain qualifications which must be met. The first is that the home must be the debtors primary residence. This means a seller can't short sale a rental property and claim the forgiveness. Second, the debt forgiven must be from purchase money or a non cash out refinance. In other words, if you took out an equity loan to buy a boat or pay of credit card debt, you will be taxed on the amount forgiven.
Come back in 2 weeks for part 3 of To Short or Not to Short.
Important legal disclaimer: I am a Realtor with a lot of knowledge and experience on my side. I am not a lawyer or an accountant. As such, for legal or tax advise you should consult a professional in that field. This article is a collection of my opinions and should not be considered legal or tax advice.
Tuesday, June 28, 2011
To Short or Not to Short...that is the question. Part 1
Today's real estate market is a confusing spiral of conflicting information and challenging choices. Short sales, foreclosure, strategic default, waiting it out, or just burying your head in the sand are all options considered by distressed and depressed home owners today.
Perhaps a quick definition of potentially unfamiliar terms would be in order. Short sale: This is when the owner is selling their home for less than is owed to the bank. The bank must agree to accepting less than is owed and allowing the lien to be released from title. While we all understand foreclosures and assume they are caused by the owner's inability to pay, there is another option. Many owners are able to pay, but due to any number of factors choose to not pay. Strategic defaults are much more prevalent in larger cities where values have taken larger hits than we have seen in Lane County. Las Vegas is a perfect example. Some neighborhoods have seen declines of 50% or more in values. In these situations many borrowers look at their home from an investment point of view and wonder how many years it will take to get their value back and weigh that information against the consequences of just walking away. In Oregon, under a basic note and trust deed, there is no deficiency to the owner if they walk away. Enter strategic default. The choice to just walk away even if you can pay the bill.
Waiting it out is another option. Many owners, looking at their home as a home and not an investment choose to continue making their payments and realize having a home is a necessary expense. They know one day the value will return and will choose to sell at that point.
Sticking one's head in the sand is also a choice. Not a good one, and it generally ends in foreclosure, but it is still a choice.
Now back to the original question. Should you consider a short sale? Over the past five years short sales and the processes involved have evolved as fast as rabbits can breed. Home owners in distress hear many reassuring statements leading them to believe a short sale is better than a foreclosure, but as the process evolves, so do the consequences. Some common beliefs are that a short sale is better for your credit than a foreclosure, that the bank won't pursue a deficiency judgment against you, you will not be taxed on the forgiven debt, or that if you are taxed you can just tell the IRS you are insolvent and there will be no tax implications. While all these statements may be true, as with everything in life, it is in the details and certain restrictions will apply. Want to know more....come back in two weeks for part two.
Important legal disclaimer: I am a Realtor with a lot of knowledge and experience on my side. I am not a lawyer or an accountant. As such, for legal or tax advise you should consult a professional in that field. This article is a collection of my opinions and should not be considered legal or tax advice.
Perhaps a quick definition of potentially unfamiliar terms would be in order. Short sale: This is when the owner is selling their home for less than is owed to the bank. The bank must agree to accepting less than is owed and allowing the lien to be released from title. While we all understand foreclosures and assume they are caused by the owner's inability to pay, there is another option. Many owners are able to pay, but due to any number of factors choose to not pay. Strategic defaults are much more prevalent in larger cities where values have taken larger hits than we have seen in Lane County. Las Vegas is a perfect example. Some neighborhoods have seen declines of 50% or more in values. In these situations many borrowers look at their home from an investment point of view and wonder how many years it will take to get their value back and weigh that information against the consequences of just walking away. In Oregon, under a basic note and trust deed, there is no deficiency to the owner if they walk away. Enter strategic default. The choice to just walk away even if you can pay the bill.
Waiting it out is another option. Many owners, looking at their home as a home and not an investment choose to continue making their payments and realize having a home is a necessary expense. They know one day the value will return and will choose to sell at that point.
Sticking one's head in the sand is also a choice. Not a good one, and it generally ends in foreclosure, but it is still a choice.
Now back to the original question. Should you consider a short sale? Over the past five years short sales and the processes involved have evolved as fast as rabbits can breed. Home owners in distress hear many reassuring statements leading them to believe a short sale is better than a foreclosure, but as the process evolves, so do the consequences. Some common beliefs are that a short sale is better for your credit than a foreclosure, that the bank won't pursue a deficiency judgment against you, you will not be taxed on the forgiven debt, or that if you are taxed you can just tell the IRS you are insolvent and there will be no tax implications. While all these statements may be true, as with everything in life, it is in the details and certain restrictions will apply. Want to know more....come back in two weeks for part two.
Important legal disclaimer: I am a Realtor with a lot of knowledge and experience on my side. I am not a lawyer or an accountant. As such, for legal or tax advise you should consult a professional in that field. This article is a collection of my opinions and should not be considered legal or tax advice.
Saturday, December 4, 2010
The importance of caring for your REO listing
During the influx of foreclosure listings we have experienced, one thing I have noticed is the lack of attention certain agents give to their listings. Why? Well, with a normal listing, especially owner occupied, we as agents are being watched. The seller is here, they are real, and they are watching what we are doing. With an REO, there is an asset manager in some other state and they are unable to really monitor our activities.
But here is the deal.....whose best interest is it in to get the REO listing sold? The investor? Yes. The neighbors of the property? Yes. Me, the Realtor listing the house? DARN RIGHT! And so.....as the Realtor getting paid if and ONLY if the listing sells.....why do some just slap up a photo of the front of the house and call it good?
It costs a lot of time and money to effectively market and present a property, but that is what we get paid for.
The following are before and after photos of my most current foreclosure (REO) listing.....you be the judge.
But here is the deal.....whose best interest is it in to get the REO listing sold? The investor? Yes. The neighbors of the property? Yes. Me, the Realtor listing the house? DARN RIGHT! And so.....as the Realtor getting paid if and ONLY if the listing sells.....why do some just slap up a photo of the front of the house and call it good?
It costs a lot of time and money to effectively market and present a property, but that is what we get paid for.
The following are before and after photos of my most current foreclosure (REO) listing.....you be the judge.
Before and after photos, living/dining
1399 Sunny, Eugene Oregon
Before and after photos
Living and Dining room
Continuation of blog regarding caring for your REO listing
Before and after photos, kitchen
1399 Sunny, Eugene Oregon
Before and after
Kitchen
Continuation of blog post regarding caring for your REO listing.
Before and after photos, family room
1399 Sunny, Eugene Oregon
Family room
A continuation of caring for your REO post.
The importance of caring for your REO listing
1399 Sunny in Eugene Oregon
Before and after photos
Bathroom
Wednesday, October 13, 2010
Debates regarding foreclosure issues, part 2
Press Release
Release Date: October 11, 2010
Contact: Katrina Cavalli, (212) 313-1181, kcavalli@sifma.org
SIFMA Calls System Wide Moratorium on All Foreclosures ‘Catastrophic’
New York, NY, October 11, 2010—The Securities Industry and Financial Markets Association (SIFMA) today issued the following statement from Tim Ryan, president and CEO, on the foreclosure moratorium related to issues in foreclosure processing:
“It would be catastrophic to impose a system wide moratorium on all foreclosures and such actions could do damage to the housing market and the economy. It must be recognized that the mortgage market, investors and the health of the economy are all inter-related. Investors in the housing market—including American workers with pension funds, 401k plans, and mutual funds—would unjustly suffer losses in their savings from these actions. Increased uncertainty in the securitization market would further constrain consumer credit and spending, dampening our already unhealthy economic situation. If mistakes have been made in relation to foreclosure processing, SIFMA firmly believes such mistakes should be corrected. It is imperative, however, that care be taken in addressing these issues to ensure that no unnecessary damage is done to an already weak housing market and, in turn, that there is no further negative impact on the economy.”
Release Date: October 11, 2010
Contact: Katrina Cavalli, (212) 313-1181, kcavalli@sifma.org
SIFMA Calls System Wide Moratorium on All Foreclosures ‘Catastrophic’
New York, NY, October 11, 2010—The Securities Industry and Financial Markets Association (SIFMA) today issued the following statement from Tim Ryan, president and CEO, on the foreclosure moratorium related to issues in foreclosure processing:
“It would be catastrophic to impose a system wide moratorium on all foreclosures and such actions could do damage to the housing market and the economy. It must be recognized that the mortgage market, investors and the health of the economy are all inter-related. Investors in the housing market—including American workers with pension funds, 401k plans, and mutual funds—would unjustly suffer losses in their savings from these actions. Increased uncertainty in the securitization market would further constrain consumer credit and spending, dampening our already unhealthy economic situation. If mistakes have been made in relation to foreclosure processing, SIFMA firmly believes such mistakes should be corrected. It is imperative, however, that care be taken in addressing these issues to ensure that no unnecessary damage is done to an already weak housing market and, in turn, that there is no further negative impact on the economy.”
Debates regarding foreclosure issues, part 1
Wall Street Journal, Oct. 10, 2010. The foreclosure problem isn’t about whether some home owners had their homes wrongly foreclosed upon (there’s been no evidence of that to date) but to what extent banks were taking short cuts on foreclosure procedures in states requiring judicial foreclosures. Banks need to conduct their reviews and correct their processing mistakes, but talk in Congress about imposing a national foreclosure moratorium would unnecessarily disrupt the housing market at a time when it needs to find its bottom and move on.
Tuesday, October 12, 2010
A copied and pasted article, and EXACTLY why stalling foreclosures is a BAD THING!
Flawed Foreclosure Documents Thwart Home Sales
Richard Clark, left, with his agent, Kevin Corasio, is trying to buy a foreclosed home in Florida.
Chip Litherland for The New York Times
OCALA, Fla. — Amanda Ducksworth was supposed to move in to her new home this week, a three-bedroom steal here in central Florida with a horse farm across the road. Instead, she is camped out with her 7-year-old son at her boss’s house.
Richard Clark had a deal to buy this home in North Fort Myers, but it has been suspended.
Like many buyers across the country, Ms. Ducksworth was about to complete the purchase of a foreclosed house when it suddenly went off the market. Fannie Mae, the giant mortgage holding company that buys loans from commercial lenders, is pulling back sales of homes that might have been foreclosed in bad faith.
“I gave up my rental thinking I would have a house,” said Ms. Ducksworth, a 28-year-old catering assistant. “Now I’m sharing a room with my son. What the hell is up with that?”
With home sales this past summer at the lowest level in more than a decade, real estate is ill-prepared to suffer another blow. But as a scandal unfolds over mortgage lenders’ shoddy preparation of foreclosure documents, the fallout is beginning to hammer the housing market, especially in states like Florida where distressed properties are abundant.
“This crisis takes a situation that’s already bad and kind of cements it into place,” said Joshua Shapiro, chief United States economist for MFR Inc., an economic consulting firm.
Three major mortgage lenders — Bank of America, GMAC Mortgage and JPMorgan Chase — have said they are suspending foreclosures in the 23 states where they first need a judge’s approval. They are also waving off Fannie Mae from selling any of the foreclosed homes whose loans they sold to Fannie.
The companies say they are reviewing their operations after disclosures that employees signed documents without determining the accuracy of the material, as is required by law.
Those reviews are throwing into limbo hundreds of thousands of foreclosures and pending home sales, analysts estimate, though the lenders and Fannie Mae have been mostly silent about precise numbers and other specifics.
More broadly, the revelations about the sloppy paperwork are emboldening homeowners and law enforcement officials in many states to question whether lenders rightfully hold the notes underlying foreclosed properties — further chilling the housing market.
Distressed properties, many of which are in foreclosure, make up about a third of all home sales. “Foreclosures are going to slow to a crawl,” said Guy D. Cecala, publisher of the trade magazine Inside Mortgage Finance.
Of the 23 states where foreclosures need court approval, Florida has by far the most trouble — about a half-million cases clog its courts — and the moratoriums are having a noticeable effect.
Because most lenders sold their mortgages to Fannie Mae, it is largely that company that has been sending e-mails to real estate agents about putting off deals and removing
houses from the market. In most cases, the agents are being told the freeze will last 30 to 90 days, but agents say there is no way to know for sure.
A snapshot of the problems can be seen at the real estate agency that sold Ms. Ducksworth her home, Marc Joseph Realty, based in Fort Myers.
The agency had 35 deals that were supposed to close this month. As of Thursday, Fannie had postponed 11 of them. Another handful of homes that did not have offers or were being prepared for market had also been withdrawn.
“If this wipes out half my inventory, that’s a scary thing,” said Bill Mitchell, the agency’s closing coordinator.
As he spoke, his computer pinged and another message from Fannie came through about withdrawing a house. It had the subject line, “Unable to Market Notice.”
Another client of the agency, Richard Clark, is caught in the foreclosure vise on both ends.
A delivery truck driver, Mr. Clark has gone through several rough years: his wife lost her banking job and they eventually separated; a vending business did not succeed; he fell behind on his home payments; and CitiMortgage rebuffed his efforts to restructure the mortgage.
With the prospect of being tossed out of his house in a foreclosure of his own, Mr. Clark, 62, cobbled together $58,000 — most of it from his parents — and successfully bid on a house in North Fort Myers that was in foreclosure. His offer on the house, with three bedrooms and two baths, a Jacuzzi tub in the master bedroom and a Key lime tree in the backyard, was finally approved on Oct. 1.
“It’s been a rocky two years,” Mr. Clark, a stocky man with a short pony tail, wire-rim glasses and a gold hoop earring, said while touring the rambling one-story home. “It’s a dream house for me.”
Multimedia
At least, it was. On Tuesday, Fannie suspended the deal. Mr. Clark said he did not know what to do. “I’m kind of hoping I have a place to live,” he said. “Now, who knows?”
It is possible the foreclosure on his current house in nearby Cape Coral — he has a court hearing on Dec. 7 — will also become caught up in the current problems, but Mr. Clark said he was not pleased by the prospect of staying there any longer.
“I’d rather just get on with it, get on with my life,” he said.
In the states far from Florida where foreclosures are an equally large problem but there is no judicial review — Nevada, Arizona and California — there were early signs this week
that the document crisis was spreading. The only time a foreclosure in those states enters a courtroom is when the borrower sues the lender, something few of those in default have the money or the will to do.
In a telephone interview on Wednesday, Gary Kent, a foreclosure specialist in San Diego who has 80 listings, said he had not heard from Fannie or any lender about withdrawing a property. All his deals were on track, Mr. Kent said.
But a few hours later, Mr. Kent said he had received an e-mail about removing a home that was under contract.
The message was from his title insurer, who said that Pittsburgh-based PNC Bank was imposing a 30-day moratorium on all foreclosure sales. (PNC declined to comment to a reporter.)
Mr. Kent’s confidence was shaken. “My buyer’s upset, my agent’s upset and I’m a little nervous,” he said.
Several factors are likely to delay many more foreclosed houses from reaching the market and finding new owners.
Law enforcement officials in several states, including Texas, Maryland and Connecticut, are demanding a suspension of foreclosures until lenders can prove they are using legal methods.
It is unclear how many lenders will go along.
In a move that sets up a potential showdown in Texas, one major lender, CitiMortgage, is arguing that it is being considered guilty until proven innocent by the state attorney general.
“We have no reason to believe our employees are not following our process, and therefore have no reason to stop foreclosures,” a Citi spokesman said.
Another factor is the reaction of the title insurers, who defend homeowners in disputes over a home’s ownership. Lenders require title insurance before approving a mortgage.
The crisis took many title insurers by surprise, said Kurt Pfotenhauer, the chief executive of the industry’s trade group, the American Land Title Association.
One possibility the title insurers are discussing is obtaining warranties from lenders against errors in their foreclosures. Every title insurer, Mr. Pfotenhauer said, “understands there is a brand new risk that has to be evaluated. It’s not at all clear that courts across the country are going to be reversing their earlier decisions on foreclosures. But we don’t know.”
In the meantime, buyers like Ms. Ducksworth here in Ocala are at a loss for answers.
“She’s in a mess, actually,” said Jim Haston, Ms. Ducksworth’s agent.
“I really don’t know what to tell her,” he said.
Chip Litherland for The New York Times
Richard Clark, left, with his agent, Kevin Corasio, is trying to buy a foreclosed home in Florida.
Chip Litherland for The New York Times
OCALA, Fla. — Amanda Ducksworth was supposed to move in to her new home this week, a three-bedroom steal here in central Florida with a horse farm across the road. Instead, she is camped out with her 7-year-old son at her boss’s house.
Richard Clark had a deal to buy this home in North Fort Myers, but it has been suspended.
Like many buyers across the country, Ms. Ducksworth was about to complete the purchase of a foreclosed house when it suddenly went off the market. Fannie Mae, the giant mortgage holding company that buys loans from commercial lenders, is pulling back sales of homes that might have been foreclosed in bad faith.
“I gave up my rental thinking I would have a house,” said Ms. Ducksworth, a 28-year-old catering assistant. “Now I’m sharing a room with my son. What the hell is up with that?”
With home sales this past summer at the lowest level in more than a decade, real estate is ill-prepared to suffer another blow. But as a scandal unfolds over mortgage lenders’ shoddy preparation of foreclosure documents, the fallout is beginning to hammer the housing market, especially in states like Florida where distressed properties are abundant.
“This crisis takes a situation that’s already bad and kind of cements it into place,” said Joshua Shapiro, chief United States economist for MFR Inc., an economic consulting firm.
Three major mortgage lenders — Bank of America, GMAC Mortgage and JPMorgan Chase — have said they are suspending foreclosures in the 23 states where they first need a judge’s approval. They are also waving off Fannie Mae from selling any of the foreclosed homes whose loans they sold to Fannie.
The companies say they are reviewing their operations after disclosures that employees signed documents without determining the accuracy of the material, as is required by law.
Those reviews are throwing into limbo hundreds of thousands of foreclosures and pending home sales, analysts estimate, though the lenders and Fannie Mae have been mostly silent about precise numbers and other specifics.
More broadly, the revelations about the sloppy paperwork are emboldening homeowners and law enforcement officials in many states to question whether lenders rightfully hold the notes underlying foreclosed properties — further chilling the housing market.
Distressed properties, many of which are in foreclosure, make up about a third of all home sales. “Foreclosures are going to slow to a crawl,” said Guy D. Cecala, publisher of the trade magazine Inside Mortgage Finance.
Of the 23 states where foreclosures need court approval, Florida has by far the most trouble — about a half-million cases clog its courts — and the moratoriums are having a noticeable effect.
Because most lenders sold their mortgages to Fannie Mae, it is largely that company that has been sending e-mails to real estate agents about putting off deals and removing
houses from the market. In most cases, the agents are being told the freeze will last 30 to 90 days, but agents say there is no way to know for sure.
A snapshot of the problems can be seen at the real estate agency that sold Ms. Ducksworth her home, Marc Joseph Realty, based in Fort Myers.
The agency had 35 deals that were supposed to close this month. As of Thursday, Fannie had postponed 11 of them. Another handful of homes that did not have offers or were being prepared for market had also been withdrawn.
“If this wipes out half my inventory, that’s a scary thing,” said Bill Mitchell, the agency’s closing coordinator.
As he spoke, his computer pinged and another message from Fannie came through about withdrawing a house. It had the subject line, “Unable to Market Notice.”
Another client of the agency, Richard Clark, is caught in the foreclosure vise on both ends.
A delivery truck driver, Mr. Clark has gone through several rough years: his wife lost her banking job and they eventually separated; a vending business did not succeed; he fell behind on his home payments; and CitiMortgage rebuffed his efforts to restructure the mortgage.
With the prospect of being tossed out of his house in a foreclosure of his own, Mr. Clark, 62, cobbled together $58,000 — most of it from his parents — and successfully bid on a house in North Fort Myers that was in foreclosure. His offer on the house, with three bedrooms and two baths, a Jacuzzi tub in the master bedroom and a Key lime tree in the backyard, was finally approved on Oct. 1.
“It’s been a rocky two years,” Mr. Clark, a stocky man with a short pony tail, wire-rim glasses and a gold hoop earring, said while touring the rambling one-story home. “It’s a dream house for me.”
Multimedia
At least, it was. On Tuesday, Fannie suspended the deal. Mr. Clark said he did not know what to do. “I’m kind of hoping I have a place to live,” he said. “Now, who knows?”
It is possible the foreclosure on his current house in nearby Cape Coral — he has a court hearing on Dec. 7 — will also become caught up in the current problems, but Mr. Clark said he was not pleased by the prospect of staying there any longer.
“I’d rather just get on with it, get on with my life,” he said.
In the states far from Florida where foreclosures are an equally large problem but there is no judicial review — Nevada, Arizona and California — there were early signs this week
that the document crisis was spreading. The only time a foreclosure in those states enters a courtroom is when the borrower sues the lender, something few of those in default have the money or the will to do.
In a telephone interview on Wednesday, Gary Kent, a foreclosure specialist in San Diego who has 80 listings, said he had not heard from Fannie or any lender about withdrawing a property. All his deals were on track, Mr. Kent said.
But a few hours later, Mr. Kent said he had received an e-mail about removing a home that was under contract.
The message was from his title insurer, who said that Pittsburgh-based PNC Bank was imposing a 30-day moratorium on all foreclosure sales. (PNC declined to comment to a reporter.)
Mr. Kent’s confidence was shaken. “My buyer’s upset, my agent’s upset and I’m a little nervous,” he said.
Several factors are likely to delay many more foreclosed houses from reaching the market and finding new owners.
Law enforcement officials in several states, including Texas, Maryland and Connecticut, are demanding a suspension of foreclosures until lenders can prove they are using legal methods.
It is unclear how many lenders will go along.
In a move that sets up a potential showdown in Texas, one major lender, CitiMortgage, is arguing that it is being considered guilty until proven innocent by the state attorney general.
“We have no reason to believe our employees are not following our process, and therefore have no reason to stop foreclosures,” a Citi spokesman said.
Another factor is the reaction of the title insurers, who defend homeowners in disputes over a home’s ownership. Lenders require title insurance before approving a mortgage.
The crisis took many title insurers by surprise, said Kurt Pfotenhauer, the chief executive of the industry’s trade group, the American Land Title Association.
One possibility the title insurers are discussing is obtaining warranties from lenders against errors in their foreclosures. Every title insurer, Mr. Pfotenhauer said, “understands there is a brand new risk that has to be evaluated. It’s not at all clear that courts across the country are going to be reversing their earlier decisions on foreclosures. But we don’t know.”
In the meantime, buyers like Ms. Ducksworth here in Ocala are at a loss for answers.
“She’s in a mess, actually,” said Jim Haston, Ms. Ducksworth’s agent.
“I really don’t know what to tell her,” he said.
Chip Litherland for The New York Times
Let's talk about these banks STOPPING foreclosures!!
Last week I talked about this on Facebook and the opinions varied greatly. I am 100% SURE there are some cases where people were wrongly foreclosed upon, but the majority, without a doubt were done fair and square. You see, the person signing the affidavit has to swear they have personal knowledge as to the accuracy of the documents. Now, the clever people out there have figured out that when these employees are signing hundreds of these affidavits every day, there is NO way they can personally know this to be true.
Saturday, September 18, 2010
Don't let fear based media reporting sway you!
On Thursday, September 16th the Eugene Register Guard published yet another article aimed at causing fear and panic. Please read the article and then come back to read my rebuttal.
http://www.registerguard.com/csp/cms/sites/web/news/sevendays/25297620-35/percent-august-2009-bank-sales.csp
Rebuttal:
Diane needed to do more research and verification for her article. I do not know from where RealtyTrac gets their information, but it is not correct as interpreted. Right now county records show 665 foreclosed properties in Lane County. This includes banks and private parties. A 30 second search in RMLS shows me there are 259 bank owned properties in active or pending status, suggesting 38% of foreclosed properties are listed. This doesn't mean the other 62% are being held. It can take a month or longer to get a house on the market after the sale date. My latest REO listing was very clean and nice and it will still take weeks to get on the market, just due to procedures. Diane's article shows 10% being listed. My guess is RealtyTrac's information includes houses which are currently in default, not yet foreclosed.
What experience did the Broker interviewed have in the REO market? There are agents in the area who have sold hundreds of REO properties and would have been a great resource to ask for more information.
Right now is a GREAT time to buy. Rates will likely be going up in the near future, so over a 30 year term, payments on a home purchased now will be lower and gives the buyer more purchasing power. We need more articles stressing the advantages of buying a home and less articles spreading fear and dread.
This article is just one more example of irresponsible fear based reporting by The Guard and other media sources.
I have sent my comments above to the Register Guard's letter to the editor. I generally get published when I do, so be watching for it.
http://www.registerguard.com/csp/cms/sites/web/news/sevendays/25297620-35/percent-august-2009-bank-sales.csp
Rebuttal:
Diane needed to do more research and verification for her article. I do not know from where RealtyTrac gets their information, but it is not correct as interpreted. Right now county records show 665 foreclosed properties in Lane County. This includes banks and private parties. A 30 second search in RMLS shows me there are 259 bank owned properties in active or pending status, suggesting 38% of foreclosed properties are listed. This doesn't mean the other 62% are being held. It can take a month or longer to get a house on the market after the sale date. My latest REO listing was very clean and nice and it will still take weeks to get on the market, just due to procedures. Diane's article shows 10% being listed. My guess is RealtyTrac's information includes houses which are currently in default, not yet foreclosed.
What experience did the Broker interviewed have in the REO market? There are agents in the area who have sold hundreds of REO properties and would have been a great resource to ask for more information.
Right now is a GREAT time to buy. Rates will likely be going up in the near future, so over a 30 year term, payments on a home purchased now will be lower and gives the buyer more purchasing power. We need more articles stressing the advantages of buying a home and less articles spreading fear and dread.
This article is just one more example of irresponsible fear based reporting by The Guard and other media sources.
I have sent my comments above to the Register Guard's letter to the editor. I generally get published when I do, so be watching for it.
Saturday, September 11, 2010
A Distressed Property Study, by ME!
I have a new REO listing in a newer subdivision in Eugene. Part of my due diligence for the asset manager I was researching the neighborhood. What i found was quite disturbing and I thought I would share it with you.
86 Lots in the subdivision
In the last 9 months 8 homes (10%) have sold
Of those 8 homes, 4 (50%) were fair market
Of those 8 homes, 4 (50%) were short sales or REO
Currently there are 4 homes (5%) on the market
Of those 4 homes 3 (75%) are fair market
Of those 4 homes 1 (25%) are distressed.
With the subject and property next door coming on market it will change to:
6 active listings (7.5%)
3 will be fair market (50%)
3 will be distressed (50%)
For the 4 current active listings: average days on market is 117, average price per square foot is $136
For the 8 sold listings: average days on market is 192, average price per
square foot is $128
What this does not count are the homes which are currently delinquent.
Also, it shows that 50% of the homes currently on the market, or sold
in the last 9 months were distressed in some way, which is very high.
Of these 14 listings 2 were/are short sales. Their average price per square foot is $114.
Of the 14 listings 7 were/are fair market transactions. Their average price per square foot is $139
The remaining 5 were/are foreclosures and sold for $123 per square foot.
What I find the most disturbing is the following summary information:
Average price per square foot for FORECLOSURE properties: $123
Average price per square foot for FAIR MARKET properties: $139
Average price per square foot for SHORT SALE properties: $114
If you are wondering what this means, well, let me tell you. It means, as I have been saying, short sales are KILLING property values. The bank would rather (if it makes sense) take the short sale than foreclose because the costs to foreclose are so much higher. In addition, government programs are giving banks rebates (so to speak) for doing short sales. So if the bank can get all or some of the deficiency between the short sale pay off and the full balance, it works better for them.
So where is the problem? The problem is for the people next door to the short sale transaction. Their property value goes down an additional $9 per square foot based on the averages I presented above. For a home with 1,800 square feet, that means $16,200 in lost equity.
86 Lots in the subdivision
In the last 9 months 8 homes (10%) have sold
Of those 8 homes, 4 (50%) were fair market
Of those 8 homes, 4 (50%) were short sales or REO
Currently there are 4 homes (5%) on the market
Of those 4 homes 3 (75%) are fair market
Of those 4 homes 1 (25%) are distressed.
With the subject and property next door coming on market it will change to:
6 active listings (7.5%)
3 will be fair market (50%)
3 will be distressed (50%)
For the 4 current active listings: average days on market is 117, average price per square foot is $136
For the 8 sold listings: average days on market is 192, average price per
square foot is $128
What this does not count are the homes which are currently delinquent.
Also, it shows that 50% of the homes currently on the market, or sold
in the last 9 months were distressed in some way, which is very high.
Of these 14 listings 2 were/are short sales. Their average price per square foot is $114.
Of the 14 listings 7 were/are fair market transactions. Their average price per square foot is $139
The remaining 5 were/are foreclosures and sold for $123 per square foot.
What I find the most disturbing is the following summary information:
Average price per square foot for FORECLOSURE properties: $123
Average price per square foot for FAIR MARKET properties: $139
Average price per square foot for SHORT SALE properties: $114
If you are wondering what this means, well, let me tell you. It means, as I have been saying, short sales are KILLING property values. The bank would rather (if it makes sense) take the short sale than foreclose because the costs to foreclose are so much higher. In addition, government programs are giving banks rebates (so to speak) for doing short sales. So if the bank can get all or some of the deficiency between the short sale pay off and the full balance, it works better for them.
So where is the problem? The problem is for the people next door to the short sale transaction. Their property value goes down an additional $9 per square foot based on the averages I presented above. For a home with 1,800 square feet, that means $16,200 in lost equity.
Monday, August 30, 2010
How Does This Remain Legal?
Let's talk about a home owner in distress. An investor comes along and gets the owner to agree to sell their house to the investor. The investor then opens negotiations with the bank. The "buyer" in the offer is one of the investor's employees. They don't use their company name as the buyer. The bank is then given the buyer's phone number, which is the company's phone number. When a Realtor is called out to do the BPO (broker price opinion), they are only allowed in the property escorted by yet another employee of this investor. The investor's employee then gives the Realtor a packet of information. This generally includes misleading comparable properties they want us to use as well as information regarding the offer on the table. It gets worse. I have even been given copies of letters from junior lien holders with the owner's account numbers.
While the investor is negotiating with the banks, they put the house in MLS at a much higher price. They market it with themselves as the seller. They are looking for an end buyer who will pay more.
They secure the buyer, and then they close escrow on the property. They are now officially the seller, though in MLS they were already representing that they were.
Here is a sticky point. Oregon law only allows Realtors to hold an earnest money check for three days. Prior to the investor taking title, the title company can't open an escrow file for it. They can't have two files open on the same house at the same time. So, they are unable to hold the check. We have checks sitting around for weeks at a time, waiting for a home.
I welcome your thoughts and opinions...
While the investor is negotiating with the banks, they put the house in MLS at a much higher price. They market it with themselves as the seller. They are looking for an end buyer who will pay more.
They secure the buyer, and then they close escrow on the property. They are now officially the seller, though in MLS they were already representing that they were.
Here is a sticky point. Oregon law only allows Realtors to hold an earnest money check for three days. Prior to the investor taking title, the title company can't open an escrow file for it. They can't have two files open on the same house at the same time. So, they are unable to hold the check. We have checks sitting around for weeks at a time, waiting for a home.
I welcome your thoughts and opinions...
Friday, August 13, 2010
The random pricing strategy for short sales.
I just completed a BPO on a really great property and as I was looking at the active and sold comps out there, steam was coming out of my ears.
.
The random pricing strategy for short sale properties never ceases to amaze me. The following is mathmatecially accurate, but I have changed the names and numbers to protect the not so innocent. After you read it, tell me how you feel about short sales. I want you to also remember every sale recorded will impact the value of YOUR property. So, if your neighbor decides to no longer care and sell for below value, your value just went down.
.
All comparable properties were within a one mile radius of the subject. Our market is fairly stable, we have had a decrease in activity since the end of the tax credit, but activity in April was artificially increased due to the tax credit, so the drops we are seeing are not as drastic as they seem.
.
The subject's suggested value is $215,509 which is significantly higher than it's current listing price of $148,500. This is because the property is listed below value. In our area we have an alarming situation of homes being undervalued in short sale situations. The reason is because the seller doesn't care. When it comes to the point that the seller will be receiving no funds from the transaction their motivation to get the highest price possible is removed from the equation.
.
In addition, we have listing agents who arbitrarily assign list prices without any thought to the actual value, again because it doesn't matter to them or the seller. Their primary goal is to get as many homes sold as fast as possible.
.
The listing agent on this specific property is active in the short sale market and heavily solicits distressed property owners to short sale their homes.
.
It is also important to take attention to the listing history. The subject was listed with this agent on June 7 2010 for $180,000. At 13 days on the market they dropped the price to $171,000. At 24 days on the market they dropped the price to $157,5000 and at 37 days on market it was dropped to $148,500, the current listing price. This is a well known strategy, list at a higher price and do frequent reductions. On the surface, Reliable Randy Realtor can then tell the loan servicing company that a higher value was tried and with consistent price reductions, they finally had to drop to such a low price due to lack on interest. The reality is that the property was not given a fair chance to receive an offer. 37 days is not enough time in our current market. In addition, buyers are shying away from short sales as they are tired of the inconsistency and lack of responses from banks. They are much more inclined to buy an REO or a fair market sale.
.
That is all!
.
The random pricing strategy for short sale properties never ceases to amaze me. The following is mathmatecially accurate, but I have changed the names and numbers to protect the not so innocent. After you read it, tell me how you feel about short sales. I want you to also remember every sale recorded will impact the value of YOUR property. So, if your neighbor decides to no longer care and sell for below value, your value just went down.
.
All comparable properties were within a one mile radius of the subject. Our market is fairly stable, we have had a decrease in activity since the end of the tax credit, but activity in April was artificially increased due to the tax credit, so the drops we are seeing are not as drastic as they seem.
.
The subject's suggested value is $215,509 which is significantly higher than it's current listing price of $148,500. This is because the property is listed below value. In our area we have an alarming situation of homes being undervalued in short sale situations. The reason is because the seller doesn't care. When it comes to the point that the seller will be receiving no funds from the transaction their motivation to get the highest price possible is removed from the equation.
.
In addition, we have listing agents who arbitrarily assign list prices without any thought to the actual value, again because it doesn't matter to them or the seller. Their primary goal is to get as many homes sold as fast as possible.
.
The listing agent on this specific property is active in the short sale market and heavily solicits distressed property owners to short sale their homes.
.
It is also important to take attention to the listing history. The subject was listed with this agent on June 7 2010 for $180,000. At 13 days on the market they dropped the price to $171,000. At 24 days on the market they dropped the price to $157,5000 and at 37 days on market it was dropped to $148,500, the current listing price. This is a well known strategy, list at a higher price and do frequent reductions. On the surface, Reliable Randy Realtor can then tell the loan servicing company that a higher value was tried and with consistent price reductions, they finally had to drop to such a low price due to lack on interest. The reality is that the property was not given a fair chance to receive an offer. 37 days is not enough time in our current market. In addition, buyers are shying away from short sales as they are tired of the inconsistency and lack of responses from banks. They are much more inclined to buy an REO or a fair market sale.
.
That is all!
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