What is Your Stress Style?

Like the difference between an introvert and an extrovert, we all react differently to stress.  Some of us get energized and spring into action, some adopt the head in the sand, hope it goes away position.  Don’t judge yourself, it is just the first impulse.  You can still decide to do something different.

You know that stack of unopened letters from the bank?  One of them may contain a way to get back on track and avoid a foreclosure.  Ever since the government put the banks on notice with the Robo Signing $24 billion judgement, banks have been active in offering alternatives to foreclosure.  They include interest reduction, lowering payments, short sale cash incentives and, in rare instances, principal reductions.

What you don’t know CAN hurt you.

I know it is hard, but there may be hope yet.  Wouldn’t you feel awful if your found out later that you did have a way out?  So, pull your head out of the sand and grab your letter opener and find out what options may be waiting.

Here are some examples of things that have gone out in the mail and unfortunately have been ignored by stressed out homeowners….

  • B of A selected 200,000 delinquent homeowners for a principal reduction of up to $150,000 a piece.  They sent the letters registered mail.
  • Chase is offering cash incentives of anywhere from $2,500 to $45,000 to do a short sale.  They selected 57,000 homeowners and sent the notice out in the mail.
  • In the last 6 months banks have been on the move and coming up with loan modification and short sale programs and they are mostly notifying their customers through the mail.

So go ahead…open them up.

If there is nothing in the mail, call your lender and ask what other solutions they have. New ones may have been added since the last time you spoke to them.  Good luck and call me if I can be of help.

Tip:  Ask a close friend(s) over, hand them a letter opener and make a party of it.  Whoever finds an incentive offer first, gets the door prize!

B of A Takes Pilot Short Sale Relocation Assistance Program Nationwide

A pilot program begun in Florida is now being taken nationwide by Bank of America.  The program provides home owners with relocation assistance when they complete a Short Sale.

Amounts run from $2,500 to $30,000 depending on the situation, the value of the property, and the decision of the investor who owns the loan.

Here’s the criteria:

  • Must have pre-approval for a short sale
  • Must participate in either the government’s HAFA (Home Affordable Foreclosure Alternative) short sale program or B of A’s proprietary short sale program
  • Process must be initiated by 2012
  • Sale must be completed by September 13, 2013

Note:  Short Sales already in escrow are not eligible for this program.

Where Do You Begin?

Like a lot of difficult things in life, the first step is the hardest.

When you’ve come to the inescapable conclusion that there is just no way to keep up with your mortgage payments and that the longer you put off finding out what your options are, the worst things will be and the fewer avenues you will have open, you’re ready to do something, but what?

As a CDPE (Certified Distressed Property Expert), I know where to start and how to proceed and that is one of the biggest advantages I bring to the table on your behalf.   Everyone’s time frame is different and my approach will be different depending on how much time you have.

 CDPEs enjoy a 80% rate of success in Short Sales.

I’d like to see everyone exploring their options the day after they miss the first payment. Sadly, this hardly ever happens because we go into denial over our circumstances.  It’s a common human reaction, but don’t let it stop you from taking a step forward. Really, there should be no foreclosures hitting the market before a loan modification, and if that did not work, a Short Sale was attempted.

Unfortunately we see foreclosures hit the market every day where the home owner gave up because they just didn’t know there was any other way.

Picture a large flow chart with your house at the beginning.  On this chart there are connecting “routes” to the best outcome for you.  What route is taken depends on the amount of time you have, the number of lenders to negotiate with, and even the condition of the property.

The foremost goal is to save your home.  If that can’t be done, then to save your credit by Short Selling  your home.  So, where do you start?  By getting in touch with me by email or phone.  Let’s talk about what you are facing and what options are open to you.

Yes, I do short sales, but what I am after first is the best solution for YOU. I layout the options you may have after the facts of you particular situation are evaluated: loan modification, re-finance, non-profit services, federal programs,…  A short sale is one solution, but you may find a better one.

Foreclosures last approximately 7 years on  credit ratings.  For most families that is almost half the number of years their children live at home with them.

 

Lenders Paying Homeowners to Do Short Sales

Source: February 26th, 2012 in CDPE bulletin…

For awhile now, we’ve instructed agents on government incentives available to distressed homeowners who opt to do short sales. Such programs include the Home Affordable Foreclosure Alternatives (HAFA) program, which provides up to $3,000 to assist the borrower with relocation fees.

In recent news, major publications including USA TODAY and CNN Money have spotlighted the incentives provided by banks. These incentive programs, which offer anywhere from around $2,000 to upwards of $35,000, are intended to provide homeowners with the resources and motivation to pursue a short sale.

As banks look to ramp up short sales, such incentives are becoming more frequent. JPMorgan Chase began their incentive program last year, for example, and Bank of America (which plans a 60-70% increase in short sales this year) piloted a program in Florida this past December. Wells Fargo offers incentives as well, though primarily in states where the foreclosure process is particularly lengthy.

We’ve said it before, and we’ll say it again: This year looks to be the year of the short sale.

For banks, short sales can be a cheaper alternative to foreclosure. The foreclosure process is lengthy and costly, so much so that providing up to a $20,000 alternative for a short sale is still a cheaper option.

In USA TODAY’s article “Lenders Paying Borrowers to Do Short Sales”, Jim Gillespie, chief executive of Coldwell Banker, is quoted as saying “It’s a lot cheaper to shell out $10,000 or $20,000 to someone than it is to go through a long foreclosure.”

In addition to the cost of the foreclosure process itself, foreclosed properties sell for less than short sales on average. According to the National Association of REALTORS®, foreclosed properties sold for 22% less than conventional sales, while short sales sold for around 14% less.

HAFA Update: Lots of Good News for Stressed Home Owners

Due to expire at the end of 2012, HAFA is now extended to the end of 2013!

This is a huge positive development for a program focused on helping distressed homeowners out of their mortgages while keeping their credit ratings intact.

But, that’s not all; there’s lots more good news…

  • Removal of occupancy requirements. (Previously HAFA required homeowners to have lived in the property within the last 12 months.)
  • $3,000 cash incentive to the home owner still applies. Now covers either owner OR tenant occupied properties at the time of sale.
  • Secondary lien holder may receive up to a maximum of $8,500, up from $6,000 previously. This makes it easier to negotiate with the second who normally gets very little compared to the first.
  • Payments can continue to be made to the loan servicer, even if they are over 32% of income, to stay current until sale
  • Major Credit Reporting bureaus are changing the way they report a Short Sale to either  “13” (Paid in full or closed account, zero balance) or “65” (Account paid in full, a forclosure was started as applicable)
A homeowner can be current on their mortgage, qualify for HAFA, continue to make their payments, and execute a short sale with minimum impact on their credit!

Come In Out of the Cold

Come In Out of the Cold

Most likely you found your way to this site looking for answers for yourself, or for someone you know, about what can be done when a Homeowner is in danger of losing their home.  Financial hardship is draining and it’s easy to feel like you’ve failed.  But you haven’t, and you are not alone.

The way through is to make good decisions and for that you will need good, up-to-date, information.  With every bank reacting differently and policies literally changing daily, who has time to keep up with their own life AND make sense of all that is going on in the real estate world.

There are even cash incentives to help you relocate after the house sells.

The good news, and there is some, is that it is getting easier to Short Sale your home if you are not able to continue to keep up with the payments and falling further and further behind.  The really good news is that, compared to a foreclosure, the Short Sale process is much easier on you and on your credit rating.  You can potentially be in shape to purchase another home in as little as two years vs. seven years with a foreclosure.

So, welcome.  If you have questions about your own situation and would like a private consultation, contact me.  I am here to help.

Sheila Lawrence

e: sheilaklawrence@gmail.com

p: 707.478.7240

w: SheilaLawrence.com