Can the Bank come after me after a Short Sale?
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Courtesy CAR Legal Department:
In a nutshell probably not but please consult your attorney and tax expert to discuss your specific situation;
For a summary of the current facts, click this link: deficiency article
Remember that a Judicial Foreclosure is uncommon in California where most banks use a Non-Judicial Foreclosure or Trustee Sale. However this is the lender’s choice and the borrower has no control over that election.
Call me anytime to discuss
The Truth about the American Real Estate Market!
If you watch the news or read the newspaper, it can be
difficult to keep up with the state of the economy. Over the last century, the
real estate market has had its share of ups and downs, none as dramatic as the
highs and lows experienced during the past decade. However, the pendulum is on
its way back, signaling the recovery of the housing market. Although the
housing slowdown has fostered anxiety among investors and homebuyers alike,
real estate has been, and will continue to be, a good long-term investment.
To help separate fact from fiction, I’m
sending you timely information about the historical trends that have shaped the
real estate market over the last century and offer valuable insight into its
recovery. The first page provides an outline of historical trends in home
values, mortgage rates and home equity over the last century. Page two gives an
overview of homeownership trends and demographics. Feel free to share this
information with your family or friends who are looking to buy a home.
You can see this information by clicking here: IOV
And to see an arguement using basic Supply and Demand economics as to the future shortage of housing, click here:
San Diego is especially succeptible to a shortage due to our geographic limitations and the desireability os So Cal as a destination.
Please call me for more information about the
local real estate market.
Fraud Alert: Email falsely claims to be from FTC
With Thanks from the C.A.R. California Association of Realtors.
The FTC is warning small businesses that an email with a subject line “URGENT:
Pending Consumer Complaint” is not from the FTC. The email says that a
complaint has been filed with the agency against their company. The FTC advises
not to click on any of the links or attachments with the email. Clicking on the
links may install a virus on the computer.
The FTC advises recipients to delete the email.
How much can I get back if I remodel my kitchen?
The short answer is 68.7% (Source: National Association of Realtors 2010-2011
Remodeling Cost vs. Value Report)
The kitchen remains the most popular room in the house to remodel. Homeowners renovate to
modernize the space with the latest appliances, to accommodate changing needs
or to add value to the home in anticipation of a home sale. Although it’s
tempting to spend thousands on the latest trends and brands, it is possible to
revamp the kitchen without breaking the bank.
This month I’ve sent valuable information about conducting a cost-effective kitchen remodel.
The first page outlines cost-saving alternatives of the most common elements of
a kitchen remodel. Page two offers valuable tips for a pre-sale kitchen
renovation. Feel free to share this information with family and friends who may
be interested in remodeling their kitchens.
See the pdf I’ve included here:
If you are selling your home, here are some additional tips on what to do in the kitchen, probably the most important room for a buyer:
As always, please do not hesitate to contact me with questions or for a referral to a great kitchen designer, contractor or for my input on what you should or should not do in your home to make it the most cost effective remodel. I’ve done this few times myself and for clients. It’s worth the cost (free) to get another opinion.
Also please remember that I work by referral and I am never too busy to help your friends and colleagues meet or exceed their real estate goals. Please contact me if you know anyone who could use my help.
Bank Of America Could Reduce your Mortgage Principal!
Courtesy of The UT:
If you’re a cash-strapped homeowner in California with a mortgage serviced by Bank of America, you may have a chance at getting your principal lowered through a state program that helps people stay in their homes.
The California Housing Finance Agency said earlier this week that Bank of America is now part of Keep Your Home California’s principal-reduction program, making it the largest loan servicer involved in lowering loan balances for those with economic hardships.
A servicer is a company homeowners make their mortgage payments to every month. Bank of America serves more than two million home loans in the state, agency officials said.
Other servicers involved are the California Department of Veterans Affairs, the California Housing Finance Agency, Community Trust/Self Help, GMAC, Guild Mortgage Company and Vericrest Financial.
Agency officials hope that list continues to grow.
“We believe principal reduction can be an appropriate tool for helping qualified homeowners obtain an affordable and sustainable modification,” said Claudia Cappio, California Housing Finance Agency’s executive director, in a statement.
Keep Your Home California’s principal-reduction program is one slice of a $2 billion effort to help struggling homeowners avoid foreclosure.
Qualified homeowners could be eligible for up to $50,000 in assistance from the Keep Your Home California program, which requires the mortgage investor to match dollar-for-dollar the amount provided by the program.
For instance, if the program agrees to reduce the principal by $50,000, then the mortgage investor must match that $50,000 reduction, resulting in a total $100,000 reduction.
Bank of America borrowers who don’t qualify for the principal-reduction program will be evaluated by bank representatives to explore other options, including a loan modification.
Keep Your Home California is funded by the U.S. Treasury Department.
If you have questions, call 888.954.KEEP (5337) or visitKeepYourHomeCalifornia.org.
Reach reporter Lily Leung at lily.leung@uniontrib.com or 619-293-1719. Follow her on Twitter @LilyShumLeung and onFacebook.
LAW AGAINST SHORT SALE DEFICIENCIES EXPANDED
In a major victory for REALTORS®, Governor Brown signed into law today a C.A.R.-sponsored bill, Senate Bill 458, prohibiting a deficiency after a short sale for one-to-four residential units, regardless of whether the lender is a senior or junior lienholder. Effective immediately for transactions closing escrow from this day forward, both senior and junior lienholders cannot require a borrower to owe or pay for a deficiency in a short sale. This law also prohibits any deficiency judgment to be requested or rendered for senior or junior liens after a short sale of one-to-four residential units. Any purported waiver of this rule shall be void and against public policy.
Although a lender cannot require a borrower to pay any additional compensation in exchange for a short sale approval, the new law does not prohibit a borrower from voluntarily offering a monetary contribution to a lender in hopes of obtaining a short sale. A lender is also permitted under the new law to negotiate for a contribution from someone other than the borrower, such as other lenders, agents, relatives, and the like.
Exceptions to the new law include a lender seeking damages for a borrower’s fraud or waste; a borrower that is a corporation, LLC, limited partnership, or political subdivision of the state; a lien secured by a bond as specified; a public utility lien; and additional rules apply if a note is cross-collateralized by more than one property.
This law is fully set forth as Senate Bill 458 (Corbett) at www.leginfo.ca.gov.
Have You Saved Enough for Retirement?
Over 51 percent of Americans participate in a retirement savings plan; however, many feel that they will not have enough money to support them in retirement. Some have even postponed the age at which they planned to retire in an attempt to save more money.
This month, you can see pertinent information about the Roth IRA, a flexible tax-free retirement savings account especially beneficial to young people and those with limited incomes. The first page provides an overview of the Roth IRA, including its advantages and limitations. Page two examines how the Roth IRA can be used to help you save for large investments, such as college, the down payment on a first home or other events that cause many people to exhaust their retirement savings. Since many people are interested in ways to save money for retirement, feel free to pass this information on to your family and friends.
For you who are on this page, I have also included a “Bonus” page with more special information.
If you would like to learn more about Roth IRAs, please call me for a referral to a financial service professional.
Lenders stop accepting some applications, prices to rise??
In anticipation of the expiration of current loan limits on Sept. 30, 2011, Bank of America has decided to stop accepting conventional and government applications for loan amounts that will exceed the permanent loan amounts. The deadline to submit loan applications was July 1.
According to an email from Bank of America, conventional loans that exceed the permanent loan limits will now be required to use non-conforming programs.
Barring Congressional action, the maximum FHA, Fannie Mae, and Freddie Mac conforming loan limit will decline to $625,500 beginning Oct. 1, 2011, from the current $729,750 limit, though the majority of counties will fall far below the $625,500 maximum.
In San Diego county, the limit will be much lower! For single units (homes condos etc.) it will be $546,250 and for 2-4 unit buildings the limits will be $699,300, $845,300 and $1,050,500 respectively.
The conforming loan limit determines the maximum size of a mortgage that FHA, Fannie Mae, and Freddie Mac government-sponsored enterprises (GSEs) can buy or guarantee. Non-conforming or jumbo loans typically carry a higher mortgage interest rate than a conforming loan and require a higher down payment, increasing the monthly payment and negatively impacting housing affordability for California home buyers.
SO WHAT DOES THAT MEAN FOR YOU?
Anyone who is trying to buy or sell a home below these limits will find no real change in the loan process but should expect prices to increase, while those above these limits will find the market slowing. Why? It will be harder to sell in the higher price range because of a drop in demand due to fewer people being able to come up with the higher down payment required for the ‘non-conforming’ loan. I expect prices to drop in those areas. Ironically I expect buyers in the lower price range to compete more for the homes they can afford and thus those homes will increase in value, driving the ones close to the limit higher in price and perhaps even above it. The result: There will be a bifurcation of home values, with the demarcation at the loan limit. That will impact a large number of both buyers and sellers, with the markets reacting in very different ways.
Over the long-term I anticipate the banks will stop overreacting to the mess they created previously and return to a more centrist, logical view to lending when the markets will again achieve balance. But don’t expect that for 2-4 years.
Our only hope is that Congress will act to buffer the expected change. So contact your representatives and ask them to support the real estate market, and thus the economic recovery, by toning down the too strict rules against non-conforming loans.
Please call to discuss or comment.
More proof that Commercial Real Estate (CRE) is doing fine!
Many people expect the same amount of ‘chaos’ to occur in the CRE market. Again this is an example of the mass media only telling us the bad news. Here is an article which shows that CRE is placing LESS risk on the banks. The real estate recovery is here. The advice I give to investors is to buy now if you can. Real estate is having a sale of 35% off, with loans at record lows. Call me to discuss your investment plans if necessary.