TO be fair, the example I’m using is from Florida. But ask anybody who has gone through a short sale in Phoenix, and I’m sure this has happened here.
Say what you want about Zillow’s Zestiamtes, and Trulia’s business model, but I love the way that they have created an open forum for consumers to ask questions and get legitimate answers. I get the feeds for certain topics sent right to my email in the hopes that I can learn something and that I can share what I know.

This morning I saw someone had asked a question about the short sale process:
“We made an offer on a short sale (Chase.) After we submitted an amended offer agreeing to a binder after seller acceptance at their request, we are told there is now another offer. They are now asking for our highest and best. Knowing that it is a short sale, should we really offer our highest and best or leave a little wiggle room in case Chase comes back and negotiate?”

Oddly, some of the answers revolved around REO (Real Estate Owned) listings. Here is my answer:
“The listing agent is going to screw up the deal. Did the sellers already accept your offer or are they waiting to sign off once the bank gives approval? I’m not sure if your local rules are different, but the BEST way to get short sales closed is to accept an offer and hold any new offers as back up (NOT submitting them to the bank). If the sellers accepted, you have a binding contract. They should NOT be submitting more offers to the bank. This will just screw up the deal. You should not have to do a highest and best since your offer was already accepted. If the listing agent submitted the other offer to the bank, then you are in trouble. The bank could just deny your offer and accept the other one.”

Let me reiterate: When your home is in the short sale process, you should only accept and send to the bank (for approval) one offer! Any other offers, even if they are for more money, should be held in the back up position. To you, the seller, the final sales price shouldn’t matter. Your agents fiduciary responsibility is to you, and making sure that the short sale gets approved and closed; not to get the highest price!

The offer you select should have a reasonable chance of being approved by the bank. If the home is worth $150k (no matter what you owe) then an offer close to that is what should be sent in! Every time you send in a new offer, you are screwing things up at the bank, and jeopardizing your chance for success.

If you have any questions about short selling your home, or other alternatives to foreclosure, please don’t hesitate to give me a call. I would love to help you figure out a game plan.
(480) 389-5199

Post from: The Phoenix Real Estate Guide

Phoenix Short Sale Screw Ups: How Your Agent Can Screw You Over

Eventually, everyone is going to stop paying on depreciating assets. From MSN:
“Increasingly, homeowners with good credit and no late payments are making what appears to be a strategic decision to walk away when their home’s value falls below what’s owed.

“The American consumer has had a long-held taboo against walking away from the home, and this crisis seems to be eroding that,” concludes a report on research by Experian, the credit agency, and Oliver Wyman, a management consultant company.”

The article goes on to talk about how wealthy people are more likely to strategically stop paying their mortgage and walk away or do a short sale.
“Strategic defaulters stand out among the 14 million to 15 million “underwater” mortgages, the researchers said, because they:

• Pay all their bills consistently and on time until abruptly stopping mortgage payments with no attempt to get current again.
  

• Keep current on other debts after defaulting on the mortgage.

• Keep up payments on home equity lines of credit, sometimes drawing out cash, before defaulting on both the first mortgage and credit line. “

Instead of looking at foreclosure or a short sale with negative connotations, they are being used as financial strategies. Cut your losses and move on.

The consequences discussed mainly revolve around your credit score. But here is my question, how much should someone be willing to pay to keep their credit score? If you did a short sale and saved $150k and the months of missed payments, is that worth 250 points? Put it the other way, would you pay $150k for a 250 point increase in your credit score?

Theoretically, someone could quit making payments now (in order to get a quicker short sale), rent for the next two years until the short sale is removed from their credit report, and buy again at substantially lower prices. Of course, missing payments and strategically short selling your home or doing a loan modification is not preferred, but it’s the banks who wont approve the deals otherwise.

If you want help coming up with a game plan, please don’t hesitate to give me a call. We can sit down and see if a loan modification or a short sale is right for you. (480) 389-5199

Post from: The Phoenix Real Estate Guide

Phoenix Short Sales: Is a Strategic Default Right For You?

Does this sound stupid to anyone else? I have yet to work on a short sale where the hold up was the seller (The lien holder is a different story). How would that help move things along?

And if you were a lien holder taking a $100,000 loss on an asset, how would your servicer getting an extra grand out of the deal help you cope?

If you want some honest help in getting your Phoenix Short Sale or Phoenix Loan Modification completed quickly

Post from: The Phoenix Real Estate Guide

Stupid Idea of The Week: How To (Not) Close More Phoenix Short Sales

AZCentral.com  reports that Job losses are going to hit record numbers this year.

What do you think this means for the homeowners in the next 6 months to a year?

Hopefully, some will be able to find new jobs. But many will use up their savings and then have to do a loan modification or a short sale. Increased short sales means lower prices. And the vicious cycle continues.

“For the second time this year, the Arizona Department of Commerce
has forecast 2009 job losses to be worse than expected.

The department projects record losses of about 178,500 jobs this year, a 6.8 percent drop. That’s about 32,300 more than its last 2009 forecast, issued in April.

“We thought economic conditions would actually be better, but they ended up being worse than we thought,” said Jack York, a department economist.”
Continue reading the article here

If you or someone you know is losing their job, or facing some other hardship, don’t wait until your savings are dried up. Call us today to see if a loan modification or a short sale is right for you. There is no harm in getting educated.
(480) 389-5199

Post from: The Phoenix Real Estate Guide

Phoenix Short Sales: More On The Way

Well it looks like the number of Short Sale listings in Phoenix is up over last month and over last quarter. Not by much, but still up. While the number of actives went up only 100ish units over last month, the number of Pending listings went up by 500 units, and the number of Sold short sale listings went up 200 units over last month.

One of the most important numbers, I think, is the Average Sale Price as a percentage to list price. It’s at 96.25%. That means if your home is on the market as a short sale for $100,000 it is probably closing around $96,250. Compare that to the REO market: 99.59% of list price. Neither one is a huge discount off of the listing price. What that means for the buyers out there is that you most likely can not be coming in with offers at 50% of the list price. Of course that changes if the property has not been properly priced or marketed. If you are the first offer and it has been on the market for more then a month, you probably have some room.

One last interesting number to look at is the total monthly sales volume: $240M. Two years ago? $9M. My things have changed quickly.

If you are looking to sell your home and you owe more then what it is worth, give me a call: 971-235-9561. You have options. Let’s talk about them.

Post from: The Phoenix Real Estate Guide

Phoenix Short Sales: Listings Up, DOM Up, Success Rate Up

Short sales are happening. They are all around us and the reality is that they are not going away anytime soon. As of today, there are over 12,000 active short sales in the greater phoenix area. So the stigma is gone, or should be gone, when you are the one having to do a short sale.

The biggest problem I have seen in my experience is when a home owner waits until it is too late before calling us. We’ve had someone call us a week before the foreclosure auction. Sometimes you can get an extension, but why put yourself further on the bad side of the bank? When is the best time to call us? When you know you are going to miss your first payment. This allows you to get everything prepared, and ready to move when the time comes.

Your first step is to call us. We need to sit down and discuss your options. Don’t hesitate to get that appointment set. Once we’ve met, we quickly move to get your home sold and your short sale negotiated.

Call us today to set up an appointment: 971-235-9561

Post from: The Phoenix Real Estate Guide

Phoenix Short Sales: Why wait until its too late?

Both options give you a great opportunity for saving a BUNCH of money. The major difference between the two is the time frame. I have worked on a short sale deal for over 8 months before it finally closed. I have also worked on one for about 7 months when the bank decided it would rather take the home back then sell it and foreclosed on the home (by the way, it went up for sale 2 weeks later as a bank owned home for $20,000 less then the offer they previously rejected. Man, that was a fun day when I found that out).

Short Sales: Yeah, more like LONG sales! (Get it?!?! What a great joke…)
So they take forever. The bank will not assign the file to a loss mitigator until they have an offer on the home. Not that big of a problem, except what if the offer is $50,000 then the bank is willing to take? Well, you won’t know for 2 months. They have to assign someone to the file (2-4 weeks). Then that person has to order a broker price opinion (2-4 weeks) then you have to wait for the bank to hear back from the agent (1 week) and then they have to make a decision on your original offer (2-3 weeks). And honestly, that timeline is if the bank is on top of things.

I have worked with a bank where they claimed the file was moved to another department. That dept said they didn’t have it. After 2 months of playing phone tag to see who has the file, the original person we talked to had it. Seriously. We’ve also seen banks lose a file after having been submitted 5+ times. And if they are missing one page? They told us to resubmit the entire 50+ page file, not just the one they were missing.

Rant Over.

Bank Owned Properties: (I don’t have any good jokes for this one )
Once the property moves from the short sale department to the reo department, things seem to improve greatly. Here is my theory: The Short sale department is charged with getting the most they can for the property, the reo department is charged with getting the bad asset off their books.
Remember the home from before? My guess is that the reo department saw that it had been listed for over 7 months without selling (never mind, that they had plenty of offers) so they assumed that it had to be worth much less then it was currently listed for.

The benefit with working on bank owned properties is that they already know how much they are willing to take. For the most part they are listed where the bank KNOWS it will move. They KNOW they can get a few offers in a few days at that price. Write the offer, sign their required paperwork, and you can close in about 45 days.

Post from: The Phoenix Real Estate Guide

Short Sales vs Foreclosures