OK folks.....The storms went through the Richmond area last night and did some damage on the northside of town. Luckily, nobody got hurt! Just lots of tree limbs and power lines down, but many landed on cars and homes!
So I found this article online that if you or someone you know had damage, then you need to read this or print it out for them...........Good Luck!!
October 28, 2010--Fall brings the tall end of hurricane season and also tornadoes throughout the country. For this, Allstate is providing these simple steps for customers and families to help during the recovery.
* Make sure your home is structurally safe. Be extremely careful inside your home. Debris may be hazardous and the potential for collapse may exist. You may want to retrieve personal items, but if you're told by authorities to stay out, stay out. It's for your own safety.
* Have necessary temporary repairs made to prevent further damage, keeping receipts for work performed.
* If your home is uninhabitable, find out what living expenses your homeowners or renters insurance policy may cover.
* Be patient and assist claims adjusters assigned to your case. Small losses may be settled quickly; extensive claims will take longer.
* Notify creditors if bills have been lost or you're unable to pay.
* Consider calling your utility company and ask them to stop billing if your home has been destroyed.
* Report your claim to insurance company promptly.
* Prepare to file an insurance claim by gathering all relevant policy numbers.
* Inventory your home for damaged or lost items before your adjuster arrives. This will help speed up your claim process.
* Work with a qualified tax expert to find out about tax breaks for which you may be eligible because of your losses.
Thursday, October 28, 2010
Tuesday, October 26, 2010
Protect Your Identity
This blog is a little long, but if you are concerned about identity theft, you NEED to read this!
Identity Thieves Are Crafty, Prolific
By Claudia Buck
RISMEDIA, October 26, 2010--(MCT)--It's everywhere you don't want it to be. From skimming your debit card at a gas pump to phony financial e-mails hitting your cell phone or computer, identity theft is as crafty as it is continuous.
More than 11 million of us fell victim to identity theft last year, according to an annual report by Javelin Strategy & Research.
"It's really the crime that won't go away. It's so insidious," said Gail Cunningham, spokeswoman for the National Foundation for Credit Counseling, which launched national Protect Your Identity week with the Council of Better Business Bureaus.
It also can be costly, in both time and money. The average victim of identity theft in 2009 lost $4,840 and spent 21 hours coping with the aftermath, according to Javelin's study of 5,000 U.S. consumers.
The motives of identity thieves are usually the same: to swipe your personal or financial information and use it to drain accounts, open credit cards and engage in other financial mayhem in your name.
Recently, California investigators charged three Los Angeles men with 42 counts of felony identity theft for allegedly using illegal electronic devices to skim debit and credit card numbers at seven Northern California gas station pumps, including one in the Sacramento area. They allegedly stole more than $160,000 from about 200 consumers.
Also last week, the state Franchise Tax Board and Board of Equalization warned Californians of phony e-mails to taxpayers stating that their electronic tax payments did not go through. The e-mails are an apparent attempt to electronically fish for personal data, the tax agencies said.
As a form of identity theft, these so-called "phishing scams" continually surface. The IRS, banks and other organizations regularly warn consumers about fraudulent e-mails or texts.
How can you avoid this type of identity theft? Don't respond to any request to verify your account number or password. Legitimate companies or government agencies will typically request information by letter, not in an e-mail or cell phone text.
And while identity theft can happen anywhere to almost anyone, here are some other known risks and how to avoid them:
In a tight-fisted job market, scammers prey on people's urgency to find work.
"People have gotten more desperate and have let down their guard," said Linda Foley, founder of the nonprofit Identity Theft Resource Center in San Diego. "They're taking chances with (job) ads they never would have responded to before or giving out personal information in hopes someone will hire (them)."
In some cases, phony online ads ask that a resume include a Social Security number. Or applicants are asked to bring personal documents to a location that's not a real office, but an empty storefront.
"It's buyer beware," said Foley. "If you can't see a person face to face or cannot check out the company by doing basic homework," be wary.
Limit personal information on your resume, she added. Include your e-mail address and telephone, not necessarily a home address, and never a Social Security number.
Believe it or not, children under 18 can become identity theft victims if someone uses their name and Social Security number to commit fraud.
According to the California Office of Privacy Protection, children may be targets "because the crime can go undetected for years, often until the child applies for his or her first loan or credit card."
The signs of possible child identity theft: bills, credit cards or debt collection notices coming to your home in your child's name. However, in some cases, a pre-approved credit card offer might simply be a marketing tool because you've opened a bank account or college fund in your child's name. If that's the case, ask your bank to remove your child's name from its marketing lists.
If you suspect your child's identity has been fraudulently used, check with the three credit reporting bureaus (Equifax, Experian and TransUnion) to see if a credit report exists in your child's name. Call their (800) numbers and provide your child's name and Social Security number.
If no credit report is found, it's good news. If a credit report exists, it means someone likely opened an account using your child's name. Explain the situation to the bureau and get steps on how to clear your child's credit file, including a freeze so the file can't be accessed.
In general, be stingy in giving out your child's Social Security number for school, sports or extracurricular activities. "Guard that number as carefully as you guard your child walking to school," Foley said.
When your child's number is requested, she said, ask questions: Why do you need it? If I don't provide it, is there an alternative form of ID?
Crowded malls, harried shoppers, lots of financial transactions: The upcoming holidays can be prime time for identity thieves. Above all, the best prevention is awareness — of your surroundings, your cash, your credit cards, your purse or wallet. Also:
—Never carry large amounts of cash, or your Social Security card.
—If you're not using a checkbook, keep it safe at home. Lighten your wallet or purse; if either are stolen, your losses will be fewer.
—Be careful using ATMs. If someone is standing too close, ask them to move away. If something looks amiss on the machine, go somewhere else and report it.
—Make copies, front and back, of all credit cards so you can easily report a loss or fraudulent charges.
—Reconcile restaurant receipts to be sure the meal amount and tip match what's on your bank statement.
—Check your online statements regularly to be sure all purchases are yours. Same for credit card or bank statements that come in the mail.
—When shopping online, always check to be sure you're on a company's official website, not a lookalike. Cybercrooks often change a letter or two to create phony web addresses designed to lure innocent shoppers.
SHRED 'N' DESTROY
Identity theft experts say one of the most basic precautions is to shred any personal or financial paperwork. You can buy an inexpensive shredder for home or office use or haul the paper to a free shredding event. There also are mobile shredding companies that will come to your home or office for a charge.
For electronics, when you're done with those old cell phones, printers, hard drives or scanners, don't just donate or toss them in the trash, without first erasing all personal data.
"They all capture digital images and personal data such as passwords. If you just throw these away, someone savvy enough can get that personal information and steal your identity," said Katie Robison, spokeswoman for the local Better Business Bureau.
"Fighting identity theft is a constant battle, and the attacks can come at you from all fronts," Barry Goggin, president and CEO of the West Sacramento-based BBB, said in a recent statement. "Because we are all potential victims, it's important that we all take steps to fight identity theft."
(c) 2010, The Sacramento Bee (Sacramento, Calif.).
Distributed by McClatchy-Tribune Information Services.
Identity Thieves Are Crafty, Prolific
By Claudia Buck
RISMEDIA, October 26, 2010--(MCT)--It's everywhere you don't want it to be. From skimming your debit card at a gas pump to phony financial e-mails hitting your cell phone or computer, identity theft is as crafty as it is continuous.
More than 11 million of us fell victim to identity theft last year, according to an annual report by Javelin Strategy & Research.
"It's really the crime that won't go away. It's so insidious," said Gail Cunningham, spokeswoman for the National Foundation for Credit Counseling, which launched national Protect Your Identity week with the Council of Better Business Bureaus.
It also can be costly, in both time and money. The average victim of identity theft in 2009 lost $4,840 and spent 21 hours coping with the aftermath, according to Javelin's study of 5,000 U.S. consumers.
The motives of identity thieves are usually the same: to swipe your personal or financial information and use it to drain accounts, open credit cards and engage in other financial mayhem in your name.
Recently, California investigators charged three Los Angeles men with 42 counts of felony identity theft for allegedly using illegal electronic devices to skim debit and credit card numbers at seven Northern California gas station pumps, including one in the Sacramento area. They allegedly stole more than $160,000 from about 200 consumers.
Also last week, the state Franchise Tax Board and Board of Equalization warned Californians of phony e-mails to taxpayers stating that their electronic tax payments did not go through. The e-mails are an apparent attempt to electronically fish for personal data, the tax agencies said.
As a form of identity theft, these so-called "phishing scams" continually surface. The IRS, banks and other organizations regularly warn consumers about fraudulent e-mails or texts.
How can you avoid this type of identity theft? Don't respond to any request to verify your account number or password. Legitimate companies or government agencies will typically request information by letter, not in an e-mail or cell phone text.
And while identity theft can happen anywhere to almost anyone, here are some other known risks and how to avoid them:
In a tight-fisted job market, scammers prey on people's urgency to find work.
"People have gotten more desperate and have let down their guard," said Linda Foley, founder of the nonprofit Identity Theft Resource Center in San Diego. "They're taking chances with (job) ads they never would have responded to before or giving out personal information in hopes someone will hire (them)."
In some cases, phony online ads ask that a resume include a Social Security number. Or applicants are asked to bring personal documents to a location that's not a real office, but an empty storefront.
"It's buyer beware," said Foley. "If you can't see a person face to face or cannot check out the company by doing basic homework," be wary.
Limit personal information on your resume, she added. Include your e-mail address and telephone, not necessarily a home address, and never a Social Security number.
Believe it or not, children under 18 can become identity theft victims if someone uses their name and Social Security number to commit fraud.
According to the California Office of Privacy Protection, children may be targets "because the crime can go undetected for years, often until the child applies for his or her first loan or credit card."
The signs of possible child identity theft: bills, credit cards or debt collection notices coming to your home in your child's name. However, in some cases, a pre-approved credit card offer might simply be a marketing tool because you've opened a bank account or college fund in your child's name. If that's the case, ask your bank to remove your child's name from its marketing lists.
If you suspect your child's identity has been fraudulently used, check with the three credit reporting bureaus (Equifax, Experian and TransUnion) to see if a credit report exists in your child's name. Call their (800) numbers and provide your child's name and Social Security number.
If no credit report is found, it's good news. If a credit report exists, it means someone likely opened an account using your child's name. Explain the situation to the bureau and get steps on how to clear your child's credit file, including a freeze so the file can't be accessed.
In general, be stingy in giving out your child's Social Security number for school, sports or extracurricular activities. "Guard that number as carefully as you guard your child walking to school," Foley said.
When your child's number is requested, she said, ask questions: Why do you need it? If I don't provide it, is there an alternative form of ID?
Crowded malls, harried shoppers, lots of financial transactions: The upcoming holidays can be prime time for identity thieves. Above all, the best prevention is awareness — of your surroundings, your cash, your credit cards, your purse or wallet. Also:
—Never carry large amounts of cash, or your Social Security card.
—If you're not using a checkbook, keep it safe at home. Lighten your wallet or purse; if either are stolen, your losses will be fewer.
—Be careful using ATMs. If someone is standing too close, ask them to move away. If something looks amiss on the machine, go somewhere else and report it.
—Make copies, front and back, of all credit cards so you can easily report a loss or fraudulent charges.
—Reconcile restaurant receipts to be sure the meal amount and tip match what's on your bank statement.
—Check your online statements regularly to be sure all purchases are yours. Same for credit card or bank statements that come in the mail.
—When shopping online, always check to be sure you're on a company's official website, not a lookalike. Cybercrooks often change a letter or two to create phony web addresses designed to lure innocent shoppers.
SHRED 'N' DESTROY
Identity theft experts say one of the most basic precautions is to shred any personal or financial paperwork. You can buy an inexpensive shredder for home or office use or haul the paper to a free shredding event. There also are mobile shredding companies that will come to your home or office for a charge.
For electronics, when you're done with those old cell phones, printers, hard drives or scanners, don't just donate or toss them in the trash, without first erasing all personal data.
"They all capture digital images and personal data such as passwords. If you just throw these away, someone savvy enough can get that personal information and steal your identity," said Katie Robison, spokeswoman for the local Better Business Bureau.
"Fighting identity theft is a constant battle, and the attacks can come at you from all fronts," Barry Goggin, president and CEO of the West Sacramento-based BBB, said in a recent statement. "Because we are all potential victims, it's important that we all take steps to fight identity theft."
(c) 2010, The Sacramento Bee (Sacramento, Calif.).
Distributed by McClatchy-Tribune Information Services.
14 Things to Consider Before Buying a Home
By Diane Benson Harrington (Article pulled from http://www.move.com/)
Don't let your emotions cloud your judgment!
Wait! That house may seem like everything you’ve ever wanted, but before you make an offer, take some time to consider a few things beyond the size, style and price.
When buying a home, it’s easy to let emotions get in the way of reality, or get sudden amnesia about factors that may make a difference.
"Sometimes we want something so badly, we’re not willing to ask all the questions we should,” says Leslie Levine, author of "Will This Place Ever Feel Like Home?"
For instance, she says, you may see a basketball hoop over the garage and assume the neighborhood is great for kids. But a closer inspection may show that it’s rusted and hasn’t seen a ball in a decade, and that other yards in the neighborhood have no jungle gyms or tire swings out back.
1. Visit at various times of day
The windows that let in so much light during the day may be a peeping Tom’s dream at night. That seemingly quiet residential street may be a noisy, highway-feeder street during morning or evening rush hour; or it may be near impossible to get from your quiet street across traffic and onto the feeder street in the morning. The adjacent school may seem like a nice perk if you’re buying in the summer, but during the school year, daily playground noise and extra traffic may be more than you bargained for.
2. Look through recent newspaper archives
“Make sure you’re getting information on what you can’t see,” Levine suggests. Perhaps the municipal water well that feeds your neighborhood has high levels of contaminants or a proposed high-voltage power line may soon be coming through your back yard. You can also check with the city or county to see if there are any proposed projects.
3. Talk to neighbors
How many people in the neighborhood own their homes? Sometimes it’s hard to tell at first if you’re choosing a neighborhood that’s primarily rental houses.
4. Ask if the neighborhood has an association
“Is there a newsletter for it? How often does the neighborhood get together? Do they have a block party every year?” Levine asks. “Even if you don’t plan to attend, the fact that they’re having a gathering says they care about their community, that they want to get to know each other, that they’re willing to socialize that way. People who behave that way are building a community. They’re going to look out for your kids; they’re going to look out for your house. It’s a nice, safe way to celebrate something.”
5. Quiz the sellers
What problems are they aware of that the house had in the past – even if they’ve been fixed? An ice dam five years ago may have caused water damage that has since been repaired. But it’s good to know that the house may be prone to ice dams so you can take preventive measures rather than find out the hard way. Discovering the basement flooding was solved by building up the landscaping in a particular area will prevent you from leveling the ground there in later years.
6. Get a home inspection
Virtually all houses have defects, according to National Association of Exclusive Buyers Agents. Some will be obvious and most will be curable. But knowing what needs fixing can help you negotiate a lower price – or at least prepare you for costs you’re soon to incur. Strongly consider getting inspections, too, for lead paint, radon and wood-eating pests.
7. Get detailed records on past improvements
This isn’t always possible. But if you’re told the house’s exterior was painted two years ago – and then see a receipt noting the whole project cost just $1,000 – then you’ll be forewarned that cheaper materials were used and that you may be looking at repainting sooner than you thought.
8. Don’t just assume remodeling will be a snap
If you voice your ideas to the sellers, you may be able to glean valuable insights. For instance, perhaps that shower is in an odd location because, when remodeling 10 years ago, the previous owners discovered a costly structural impediment to putting a shower where it would seem more appropriate.
9. Consider the view
“So many neighborhoods now have teardowns. So look at the two houses on either side of you. If this neighborhood has had some teardowns, one of those houses might be a candidate. And they may build some behemoth structure that affects your light or the way your house looks or your view,” Levine says.
10. Ask for utility bills
You may adore the Cape Cod architectural style or the high ceilings and walls of glass in a modern home – but those winter heating and summer cooling bills may push your monthly payments beyond affordable. Ditto for the water bills you’ll pay to maintain a pristine landscape.
11. Pay close attention to taxes
Don’t just ask what the seller’s most recent tax bill was; ask what several recent tax bills have been. In some areas, houses are re-appraised – and taxed at higher rates – frequently. That great deal and good investment may not seem quite so grand if the property taxes skyrocket year after year. Again, look at newspaper archives or talk to your Realtor about the way taxes are used in this area. In some cities, schools are substantially funded through property taxes – which means you can count on yours increasing regularly.
12. Check with city hall
NAEBA recommends looking into the property’s and neighborhood’s zoning, as well as any potential easements, liens or other restrictions relating to your property. The seller should disclose these facts, but it’s better to be safe. If you’re using a buyer’s agent, he or she should be able to help you with this.
13. Reconsider the bells and whistles
Are you sure you can live with a one-car garage, or a detached garage, or on-street parking? The pool may be a nice bonus, but can you afford the upkeep?
14. Explore the surrounding area
If you’re not just making a cross-town move, you may not know that only three blocks away, this pretty neighborhood backs up to a dumpy commercial area or a less-than-savory part of town. If the home is near an airport, fire station, police station, hospital or railroad track, expect to hear trains, planes or ambulances throughout the day and night. Make sure you’re not too close to an agricultural area that may generate odors or kick up dust or other airborne problems.
Woody's take on this article:
DON"T ASSUME!!! Don't rely strickly on what you are told! Check it out for yourself. With todays internet, you can research alot on line from home. Your Realtor can tell you which county department to talk to about other issues. Be careful, as some people, including "some Realtors" don't even know where the county offices are located!
Don't let your emotions cloud your judgment!
Wait! That house may seem like everything you’ve ever wanted, but before you make an offer, take some time to consider a few things beyond the size, style and price.
When buying a home, it’s easy to let emotions get in the way of reality, or get sudden amnesia about factors that may make a difference.
"Sometimes we want something so badly, we’re not willing to ask all the questions we should,” says Leslie Levine, author of "Will This Place Ever Feel Like Home?"
For instance, she says, you may see a basketball hoop over the garage and assume the neighborhood is great for kids. But a closer inspection may show that it’s rusted and hasn’t seen a ball in a decade, and that other yards in the neighborhood have no jungle gyms or tire swings out back.
1. Visit at various times of day
The windows that let in so much light during the day may be a peeping Tom’s dream at night. That seemingly quiet residential street may be a noisy, highway-feeder street during morning or evening rush hour; or it may be near impossible to get from your quiet street across traffic and onto the feeder street in the morning. The adjacent school may seem like a nice perk if you’re buying in the summer, but during the school year, daily playground noise and extra traffic may be more than you bargained for.
2. Look through recent newspaper archives
“Make sure you’re getting information on what you can’t see,” Levine suggests. Perhaps the municipal water well that feeds your neighborhood has high levels of contaminants or a proposed high-voltage power line may soon be coming through your back yard. You can also check with the city or county to see if there are any proposed projects.
3. Talk to neighbors
How many people in the neighborhood own their homes? Sometimes it’s hard to tell at first if you’re choosing a neighborhood that’s primarily rental houses.
4. Ask if the neighborhood has an association
“Is there a newsletter for it? How often does the neighborhood get together? Do they have a block party every year?” Levine asks. “Even if you don’t plan to attend, the fact that they’re having a gathering says they care about their community, that they want to get to know each other, that they’re willing to socialize that way. People who behave that way are building a community. They’re going to look out for your kids; they’re going to look out for your house. It’s a nice, safe way to celebrate something.”
5. Quiz the sellers
What problems are they aware of that the house had in the past – even if they’ve been fixed? An ice dam five years ago may have caused water damage that has since been repaired. But it’s good to know that the house may be prone to ice dams so you can take preventive measures rather than find out the hard way. Discovering the basement flooding was solved by building up the landscaping in a particular area will prevent you from leveling the ground there in later years.
6. Get a home inspection
Virtually all houses have defects, according to National Association of Exclusive Buyers Agents. Some will be obvious and most will be curable. But knowing what needs fixing can help you negotiate a lower price – or at least prepare you for costs you’re soon to incur. Strongly consider getting inspections, too, for lead paint, radon and wood-eating pests.
7. Get detailed records on past improvements
This isn’t always possible. But if you’re told the house’s exterior was painted two years ago – and then see a receipt noting the whole project cost just $1,000 – then you’ll be forewarned that cheaper materials were used and that you may be looking at repainting sooner than you thought.
8. Don’t just assume remodeling will be a snap
If you voice your ideas to the sellers, you may be able to glean valuable insights. For instance, perhaps that shower is in an odd location because, when remodeling 10 years ago, the previous owners discovered a costly structural impediment to putting a shower where it would seem more appropriate.
9. Consider the view
“So many neighborhoods now have teardowns. So look at the two houses on either side of you. If this neighborhood has had some teardowns, one of those houses might be a candidate. And they may build some behemoth structure that affects your light or the way your house looks or your view,” Levine says.
10. Ask for utility bills
You may adore the Cape Cod architectural style or the high ceilings and walls of glass in a modern home – but those winter heating and summer cooling bills may push your monthly payments beyond affordable. Ditto for the water bills you’ll pay to maintain a pristine landscape.
11. Pay close attention to taxes
Don’t just ask what the seller’s most recent tax bill was; ask what several recent tax bills have been. In some areas, houses are re-appraised – and taxed at higher rates – frequently. That great deal and good investment may not seem quite so grand if the property taxes skyrocket year after year. Again, look at newspaper archives or talk to your Realtor about the way taxes are used in this area. In some cities, schools are substantially funded through property taxes – which means you can count on yours increasing regularly.
12. Check with city hall
NAEBA recommends looking into the property’s and neighborhood’s zoning, as well as any potential easements, liens or other restrictions relating to your property. The seller should disclose these facts, but it’s better to be safe. If you’re using a buyer’s agent, he or she should be able to help you with this.
13. Reconsider the bells and whistles
Are you sure you can live with a one-car garage, or a detached garage, or on-street parking? The pool may be a nice bonus, but can you afford the upkeep?
14. Explore the surrounding area
If you’re not just making a cross-town move, you may not know that only three blocks away, this pretty neighborhood backs up to a dumpy commercial area or a less-than-savory part of town. If the home is near an airport, fire station, police station, hospital or railroad track, expect to hear trains, planes or ambulances throughout the day and night. Make sure you’re not too close to an agricultural area that may generate odors or kick up dust or other airborne problems.
Woody's take on this article:
DON"T ASSUME!!! Don't rely strickly on what you are told! Check it out for yourself. With todays internet, you can research alot on line from home. Your Realtor can tell you which county department to talk to about other issues. Be careful, as some people, including "some Realtors" don't even know where the county offices are located!
Wednesday, October 13, 2010
Do I Smell A RAT???
As anybody that has listened to the news or read the newspaper lately, I'm sure you have heard about the major banks stopping foreclosures. Well, let me clarify......the banks didn't stop themselves, they were stopped by judges. In other words, they weren't playing by the rules, and some judges slapped their hands.
Now, I'm not sure I understand it all, but I'll try to explain it in plain english. Several banks formed an "organization" known as MERS (not sure what the letters stand for) that assists these banks in transfering blocks of loans between each other. To this day, I don't understand why they keep buying and selling these blocks back and forth. Why not keep the loans you did?
Anyway, when these blocks get transferred from 1 bank to another, the title has to be transferred to the new bank. Now, this is true for some states, but not all (more lawyers just got a new job). When the title is transferred, it has to be recorded at the courthouse, and a fee paid. Well, MERS was set up to get around the new title and title fees, thus saving alot of time and $$$$$$ for the big banks!
Well, somebody got one of these transfers in front of a judge, and the ruling was that the new bank doesn't own the loan, without transferring title. Does that mean that the new bank doesn't have the right to collect the loan payments? As you can see, this goes deeper than most of us knew.
Now, I am not against foreclosure. If a person fails to make the payments, the bank has the right to foreclose. But, with everything else going on today, the banks also need to back off some and use some "common sense", which I think, is in short supply today.
And then, you have the homes that were bought in 2005-2007 at market value. And now in 2010, the value of the home has dropped from 5-35% (depending on where you live), and the homeowner hasn't missed a payment. Now the owner wants to sell to buy a larger home, or has a better job offer and needs to move, BUT owes more than the home can be sold for! What do they do?
That brings us to short sales, a different subject entirely, and will be discussed more at a later time.
If you have any questions about MERS or the banks stopping foreclosures, don't hesitate to email or call me at 804.712.8801
Now, I'm not sure I understand it all, but I'll try to explain it in plain english. Several banks formed an "organization" known as MERS (not sure what the letters stand for) that assists these banks in transfering blocks of loans between each other. To this day, I don't understand why they keep buying and selling these blocks back and forth. Why not keep the loans you did?
Anyway, when these blocks get transferred from 1 bank to another, the title has to be transferred to the new bank. Now, this is true for some states, but not all (more lawyers just got a new job). When the title is transferred, it has to be recorded at the courthouse, and a fee paid. Well, MERS was set up to get around the new title and title fees, thus saving alot of time and $$$$$$ for the big banks!
Well, somebody got one of these transfers in front of a judge, and the ruling was that the new bank doesn't own the loan, without transferring title. Does that mean that the new bank doesn't have the right to collect the loan payments? As you can see, this goes deeper than most of us knew.
Now, I am not against foreclosure. If a person fails to make the payments, the bank has the right to foreclose. But, with everything else going on today, the banks also need to back off some and use some "common sense", which I think, is in short supply today.
And then, you have the homes that were bought in 2005-2007 at market value. And now in 2010, the value of the home has dropped from 5-35% (depending on where you live), and the homeowner hasn't missed a payment. Now the owner wants to sell to buy a larger home, or has a better job offer and needs to move, BUT owes more than the home can be sold for! What do they do?
That brings us to short sales, a different subject entirely, and will be discussed more at a later time.
If you have any questions about MERS or the banks stopping foreclosures, don't hesitate to email or call me at 804.712.8801
Saturday, October 2, 2010
How to Stop Harassing Debt Collector Phone Calls
Paying credit cards and other unsecured debts are your lowest priority. An unsecured debt is a debt where they can't take away your car or house. A secured debt has something as collateral, such as your car, house, or anything else of value.
The most common unsecured debt is a credit card. When you stop paying them, they will call you nonstop. The reason is because they don't have any other way to collect from you.
They can't come get your car or take your house. So, they make up for that by blowing up your phone with harassing calls. In addition, they use deceptive tricks to get you to pay them. For example, there are Federal Laws that regulate what they can do or say. They aren't allowed to threaten to sue you, but then not follow thru and actually file suit. To get around this rule, they will use language that sounds legal, but isn't.
In one situation, a debt collector in Buffalo, New York named their firm Hoffman, Weinberg & O'Brien to make it sound like they were a law firm. They would then leave messages on people's answering machines. They would say they were with the office of Hoffman, Weinberg & O'Brien and then say they may resort to future legal action. In addition, they would reference case number 8306042. If you didn't know any better, you would think the case number was for an actual lawsuit against you. Scary, right?
Most credit card accounts never sue (despite the constant threats.) Even when they do sue and get a judgment, they rarely ever attempt to garnish wages. A lot of judgments expire without getting paid. But, a lot of them get paid off when a person's income increases, or that person sells a valuable asset such as a house.
Here is how to stop the harassing calls. Simply ask the person who calls for their fax number or mailing address. Then, fax or mail them a letter that requests them to stop calling you.
Here is some sample language you can put into the letter.
"Under my rights in the Fair Lending Law and the Fair Debt Collection Practices Act, I hereby request you stop any and all phone calls to me or any other person. At this time, I do not wish to speak with you, anyone at your company, or anyone representing you concerning this matter. Do not contact me by phone regarding this matter. I demand that you stop calling me at home, on my cell phone, at work, at my relatives house, or any other location. Please make any future communication with me in writing. I am aware of my rights under section 805(b)2 of the Fair Debt Collection Practices Act and am willing and able to exercise them. I am keeping track of all calls from your company and may consider recording calls."
Make sure that when you mail the letter, you send it return receipt requested. If you have access to a fax machine, then fax it out and keep the receipt. It's much easier and stops the calls quickly. Under the Fair Debt Collection Practices Act, a creditor or collection agency that calls you after you request them to stop may be liable for statutory damages up to $1,000 plus any actual damages suffered, plus attorney fees.
Another tactic you can use to shut down any debt collector is to tell them you are recording the call. They back off when they realize they are on tape. You can buy an inexpensive call recorder at Radio Shack or Amazon.com. Just hook it up to your phone and you're ready to go. In addition, you may want to keep a log of all phone calls from debt collectors. This can be useful if you ever have to go to court.
After reading the Fair Debt Collection Practices Act, in my opinion, the following acts are prohibited:
Violation #1: Call you before 8 AM or after 9PM.
Violation #2: Tell your relatives, family, or friends that you owe them money, or state that they are in the debt collection business when they contact any relatives, family, or friends.
Violation #3: Contact you after you send a written request that they cease further communication.
Violation #4: Contact you after you request they cease.
Violation #5: Threaten you with violence. In addition, they are prohibited from using obscene or profane language.
Violation #6: Publicize a list of people who owe them money.
Violation #7: Cause your phone to ring repeatedly or continuously to annoy you.
Violation #8: Call you without telling you who they are and why they are calling.
Violation #9: Mislead or falsely represent the amount owed, that they are an attorney or law firm, that if you don't pay then you'll go to jail, state or claim that you committed a crime, or threaten to take an action that is not allowed legally.
Violation #10: Not informing you that any information obtained can be used for the purpose of collecting their debt.
Violation #11: Threaten to repossess any property that they legally don't have the right to repossess. I remember hearing a lady calling a national talk show and saying that a debt collector had threatened to repossess her cat. What is this world coming to?!! That is definitely a violation! Cats, dogs, and children are not normally given as collateral against loans. This isn't the middle ages here!
Violation #12: Threaten to sue you and then not follow thru with it. In addition, they are not allowed to threaten to do anything unless they actually intend to follow thru with it.
First off, “I am NOT an attorney!” There are many good lawyers who specialize in helping consumers when a debt collector violates the act. Just google "Fair Debt Collections Lawyer." Many of them can help you at no cost out of your pocket. They will take on your case on a contingency basis and get paid from the money they collect from the debt collector.
I am not telling you to sue. Most people just want the calls to stop! Read the bottom of “page 1” again. When you get the calls, don’t forget to ask for either the fax number or their mailing address. A fax is faster, but the mail will work. And don’t forget to ask for the “return receipt”. This will cost a little, but will help if you go to court later. Keep a log on each company calling. As the saying goes…..create a paper trail!
Good Luck!!
Woody
The most common unsecured debt is a credit card. When you stop paying them, they will call you nonstop. The reason is because they don't have any other way to collect from you.
They can't come get your car or take your house. So, they make up for that by blowing up your phone with harassing calls. In addition, they use deceptive tricks to get you to pay them. For example, there are Federal Laws that regulate what they can do or say. They aren't allowed to threaten to sue you, but then not follow thru and actually file suit. To get around this rule, they will use language that sounds legal, but isn't.
In one situation, a debt collector in Buffalo, New York named their firm Hoffman, Weinberg & O'Brien to make it sound like they were a law firm. They would then leave messages on people's answering machines. They would say they were with the office of Hoffman, Weinberg & O'Brien and then say they may resort to future legal action. In addition, they would reference case number 8306042. If you didn't know any better, you would think the case number was for an actual lawsuit against you. Scary, right?
Most credit card accounts never sue (despite the constant threats.) Even when they do sue and get a judgment, they rarely ever attempt to garnish wages. A lot of judgments expire without getting paid. But, a lot of them get paid off when a person's income increases, or that person sells a valuable asset such as a house.
Here is how to stop the harassing calls. Simply ask the person who calls for their fax number or mailing address. Then, fax or mail them a letter that requests them to stop calling you.
Here is some sample language you can put into the letter.
"Under my rights in the Fair Lending Law and the Fair Debt Collection Practices Act, I hereby request you stop any and all phone calls to me or any other person. At this time, I do not wish to speak with you, anyone at your company, or anyone representing you concerning this matter. Do not contact me by phone regarding this matter. I demand that you stop calling me at home, on my cell phone, at work, at my relatives house, or any other location. Please make any future communication with me in writing. I am aware of my rights under section 805(b)2 of the Fair Debt Collection Practices Act and am willing and able to exercise them. I am keeping track of all calls from your company and may consider recording calls."
Make sure that when you mail the letter, you send it return receipt requested. If you have access to a fax machine, then fax it out and keep the receipt. It's much easier and stops the calls quickly. Under the Fair Debt Collection Practices Act, a creditor or collection agency that calls you after you request them to stop may be liable for statutory damages up to $1,000 plus any actual damages suffered, plus attorney fees.
Another tactic you can use to shut down any debt collector is to tell them you are recording the call. They back off when they realize they are on tape. You can buy an inexpensive call recorder at Radio Shack or Amazon.com. Just hook it up to your phone and you're ready to go. In addition, you may want to keep a log of all phone calls from debt collectors. This can be useful if you ever have to go to court.
After reading the Fair Debt Collection Practices Act, in my opinion, the following acts are prohibited:
Violation #1: Call you before 8 AM or after 9PM.
Violation #2: Tell your relatives, family, or friends that you owe them money, or state that they are in the debt collection business when they contact any relatives, family, or friends.
Violation #3: Contact you after you send a written request that they cease further communication.
Violation #4: Contact you after you request they cease.
Violation #5: Threaten you with violence. In addition, they are prohibited from using obscene or profane language.
Violation #6: Publicize a list of people who owe them money.
Violation #7: Cause your phone to ring repeatedly or continuously to annoy you.
Violation #8: Call you without telling you who they are and why they are calling.
Violation #9: Mislead or falsely represent the amount owed, that they are an attorney or law firm, that if you don't pay then you'll go to jail, state or claim that you committed a crime, or threaten to take an action that is not allowed legally.
Violation #10: Not informing you that any information obtained can be used for the purpose of collecting their debt.
Violation #11: Threaten to repossess any property that they legally don't have the right to repossess. I remember hearing a lady calling a national talk show and saying that a debt collector had threatened to repossess her cat. What is this world coming to?!! That is definitely a violation! Cats, dogs, and children are not normally given as collateral against loans. This isn't the middle ages here!
Violation #12: Threaten to sue you and then not follow thru with it. In addition, they are not allowed to threaten to do anything unless they actually intend to follow thru with it.
First off, “I am NOT an attorney!” There are many good lawyers who specialize in helping consumers when a debt collector violates the act. Just google "Fair Debt Collections Lawyer." Many of them can help you at no cost out of your pocket. They will take on your case on a contingency basis and get paid from the money they collect from the debt collector.
I am not telling you to sue. Most people just want the calls to stop! Read the bottom of “page 1” again. When you get the calls, don’t forget to ask for either the fax number or their mailing address. A fax is faster, but the mail will work. And don’t forget to ask for the “return receipt”. This will cost a little, but will help if you go to court later. Keep a log on each company calling. As the saying goes…..create a paper trail!
Good Luck!!
Woody
Saturday, August 7, 2010
August is HOT!!!!
Well, August has arrived in Central Virginia, and it's HOT as usual. We finally got some rain, and for those of you familiar with Richmond, German School Rd & Midlothian Turnpike intersection flooded.....AGAIN!!! Just stay away from that corner if it looks like rain!
As I said in a previous blog, I am not looking for a job at the Weather Channel!
Well, Wall Street said interest rates were going to go up, 3 months ago! But quess what......they went down.....around 4.5%. Now, that is for the BEST borrowers. You need a credit score over 720. Even if your score is around 620, the rates are still around 5%.
Real estate in Central Virginia is moving slowly. I had a listing that was headed toward foreclosure, but I found an investor 2 days before the foreclosure and got it stopped. The owner/seller will have a short sale instead of a foreclosure on his credit report. if we are able to get it closed this month.
What does that mean, you ask. Since short sales are a fairly new event in real estate, we are still learning all the details. As we know so far, you will be able to obtain another mortgage in as little as 1 year, possibly 2. If you have a foreclosure, you won't be allowed to obtain financing from Fannie Mae or Freddie Mac for up to 7 years.
So you understand, the 2 agencies mentioned above own over 50% of the mortgages in the US. But, you say, my loan is owned by Bank of America or Wells Fargo, not one of those agencies. Well, sometimes, those big banks are only servicing the loans. In other words, they get paid a fee to collect your money for the government agencies. I have heard that it could possibly be as much as 80% of the loans that BofA services.
So you need to listen when you hear Fannie Mae or Freddie Mac talking. They may actually own your loan, and you didn't even know it. So what does that matter to me, you ask!
Well, think about short sales and foreclosures. The banks lose money, RIGHT!!! WRONG!!!! If the loan is owned by the government, then the taxpayers actually lose the money, because the government then has to step in and bail the 2 agencies out.
Now, is it beginning to make sense. The banks aren't really hurting as much as they make us think they are. Fannie Mae and Freddie Mac are hurting worse. And that is with our tax dollars.
I'm sure I have probably confused some of you. The thing is, our economy needs to get past the "Short Sale & Foreclosure" part of real estate history in order for things to move forward.
It is a proven fact that the banks will lose LESS money by approving a short sale versus going through a foreclosure. And, as stated above, it is to the sellers advantage to do a short sale.
So, if you are behind on your mortgage payments, or know someone who is, do something! Don't ignore the problem, it won't go away. Please, get with a Realtor that you know and trust, and get the facts. BUT, DO NOT pay anything ($) up front. My advice is FREE, but not all Realtors work that way.
And, as the 'ole saying goes........"If it sounds TOO good,,,,,you know the rest!!
Have a good week and stay COOL!
As I said in a previous blog, I am not looking for a job at the Weather Channel!
Well, Wall Street said interest rates were going to go up, 3 months ago! But quess what......they went down.....around 4.5%. Now, that is for the BEST borrowers. You need a credit score over 720. Even if your score is around 620, the rates are still around 5%.
Real estate in Central Virginia is moving slowly. I had a listing that was headed toward foreclosure, but I found an investor 2 days before the foreclosure and got it stopped. The owner/seller will have a short sale instead of a foreclosure on his credit report. if we are able to get it closed this month.
What does that mean, you ask. Since short sales are a fairly new event in real estate, we are still learning all the details. As we know so far, you will be able to obtain another mortgage in as little as 1 year, possibly 2. If you have a foreclosure, you won't be allowed to obtain financing from Fannie Mae or Freddie Mac for up to 7 years.
So you understand, the 2 agencies mentioned above own over 50% of the mortgages in the US. But, you say, my loan is owned by Bank of America or Wells Fargo, not one of those agencies. Well, sometimes, those big banks are only servicing the loans. In other words, they get paid a fee to collect your money for the government agencies. I have heard that it could possibly be as much as 80% of the loans that BofA services.
So you need to listen when you hear Fannie Mae or Freddie Mac talking. They may actually own your loan, and you didn't even know it. So what does that matter to me, you ask!
Well, think about short sales and foreclosures. The banks lose money, RIGHT!!! WRONG!!!! If the loan is owned by the government, then the taxpayers actually lose the money, because the government then has to step in and bail the 2 agencies out.
Now, is it beginning to make sense. The banks aren't really hurting as much as they make us think they are. Fannie Mae and Freddie Mac are hurting worse. And that is with our tax dollars.
I'm sure I have probably confused some of you. The thing is, our economy needs to get past the "Short Sale & Foreclosure" part of real estate history in order for things to move forward.
It is a proven fact that the banks will lose LESS money by approving a short sale versus going through a foreclosure. And, as stated above, it is to the sellers advantage to do a short sale.
So, if you are behind on your mortgage payments, or know someone who is, do something! Don't ignore the problem, it won't go away. Please, get with a Realtor that you know and trust, and get the facts. BUT, DO NOT pay anything ($) up front. My advice is FREE, but not all Realtors work that way.
And, as the 'ole saying goes........"If it sounds TOO good,,,,,you know the rest!!
Have a good week and stay COOL!
Thursday, July 29, 2010
July 4th - And What It Meant To The Signers of The Declaration Of Independence
Have you ever wondered what happened to the 56 men who signed
The Declaration of Independence?
Five signers were captured by the British as traitors,
and tortured before they died.
Twelve had their homes ransacked and burned.
Two lost their sons serving in the Revolutionary Army;
another had two sons captured.
Nine of the 56 fought and died from wounds or
hardships of the Revolutionary War.
They signed and they pledged their lives, their fortunes,
and their sacred honor.
What kind of men were they?
Twenty-four were lawyers and jurists.
Eleven were merchants,
nine were farmers and large plantation owners;
men of means, well educated,
but they signed the Declaration of Independence
knowing full well that the penalty would be death if
they were captured.
Carter Braxton of Virginia, a wealthy planter and
trader, saw his ships swept from the seas by the
British Navy. He sold his home and properties to
pay his debts, and died in rags.
Thomas McKeam was so hounded by the British
that he was forced to move his family almost constantly.
He served in the Congress without pay, and his family
was kept in hiding. His possessions were taken from him,
and poverty was his reward.
Vandals or soldiers looted the properties of Dillery, Hall, Clymer,
Walton, Gwinnett, Heyward, Ruttledge, and Middleton.
At the battle of Yorktown , Thomas Nelson, Jr., noted that
the British General Cornwallis had taken over the Nelson
home for his headquarters. He quietly urged General
George Washington to open fire. The home was destroyed,
and Nelson died bankrupt.
Francis Lewis had his home and properties destroyed.
The enemy jailed his wife, and she died within a few months.
John Hart was driven from his wife's bedside as she was dying.
Their 13 children fled for their lives. His fields and his gristmill
were laid to waste. For more than a year he lived in forests
and caves, returning home to find his wife dead and his
children vanished.
So, take a few minutes while enjoying your 4th of July holiday and
silently thank these patriots. It's not much to ask for the price they paid.
Remember: freedom is never free!
I hope you will show your support by forwarding this to as many
people as you can, please. It's time we get the word out that patriotism
is NOT a sin, and the Fourth of July has more to it than beer,
picnics and baseball games.
HAPPY 4th TO YOU AND YOURS!!!
The Declaration of Independence?
Five signers were captured by the British as traitors,
and tortured before they died.
Twelve had their homes ransacked and burned.
Two lost their sons serving in the Revolutionary Army;
another had two sons captured.
Nine of the 56 fought and died from wounds or
hardships of the Revolutionary War.
They signed and they pledged their lives, their fortunes,
and their sacred honor.
What kind of men were they?
Twenty-four were lawyers and jurists.
Eleven were merchants,
nine were farmers and large plantation owners;
men of means, well educated,
but they signed the Declaration of Independence
knowing full well that the penalty would be death if
they were captured.
Carter Braxton of Virginia, a wealthy planter and
trader, saw his ships swept from the seas by the
British Navy. He sold his home and properties to
pay his debts, and died in rags.
Thomas McKeam was so hounded by the British
that he was forced to move his family almost constantly.
He served in the Congress without pay, and his family
was kept in hiding. His possessions were taken from him,
and poverty was his reward.
Vandals or soldiers looted the properties of Dillery, Hall, Clymer,
Walton, Gwinnett, Heyward, Ruttledge, and Middleton.
At the battle of Yorktown , Thomas Nelson, Jr., noted that
the British General Cornwallis had taken over the Nelson
home for his headquarters. He quietly urged General
George Washington to open fire. The home was destroyed,
and Nelson died bankrupt.
Francis Lewis had his home and properties destroyed.
The enemy jailed his wife, and she died within a few months.
John Hart was driven from his wife's bedside as she was dying.
Their 13 children fled for their lives. His fields and his gristmill
were laid to waste. For more than a year he lived in forests
and caves, returning home to find his wife dead and his
children vanished.
So, take a few minutes while enjoying your 4th of July holiday and
silently thank these patriots. It's not much to ask for the price they paid.
Remember: freedom is never free!
I hope you will show your support by forwarding this to as many
people as you can, please. It's time we get the word out that patriotism
is NOT a sin, and the Fourth of July has more to it than beer,
picnics and baseball games.
HAPPY 4th TO YOU AND YOURS!!!
You Can Afford to Buy and Haven't...Are You Crazy?
This may be the best buyer's market that we'll see in our lifetimes. There are lots of legitimate reasons why a person should be taking advantage of this market if they are able.
Obviously, if a person doesn't have the down payment or credit score, they won't be able to seize this opportunity. If a person is concerned about losing their job, that would be a valid reason for not buying now. If you are planning on relocating in the next year or two, maybe now isn't the time to buy.
On the other hand, if a person doesn't own a home, has good credit and job stability, they should seriously consider capitalizing on this unique combination of opportunities. A qualified real estate professional can explain all of the reasons and even suggest some very interesting financing alternatives.
Top Ten Reasons to Buy a Home NOW
1. Interest rates incredibly low – the rates are hovering at near historic lows. Interest rates play a huge part in the cost of housing together with the price and shouldn't be overlooked. The average mortgage interest rates for the past four decades were: 1970's 8.9%; 1980's 12.7%; 1990's 8.1%; 2000's 6.3%. Most experts agree that they're going to rise this year.
2. Lower Prices - Recent price adjustments have made good values that haven’t been available in some situations for years. Current buyers are able to take advantage of the discounted prices.
3. Selection is good – In a seller's market, buyers sometimes have to accept a home that may not meet their needs completely because of short supply. Inventories in most markets and certain price ranges are higher which allow buyers better choices.
4. Negotiate financing concessions – FHA, VA, and Conventional allow the seller to contribute towards financing concessions for the buyer. The money can be used for buyer's closing costs, pre-paid items or interest rate buy down.
5. Costs for FHA loan going up – Currently, a seller can pay up to 6% of the sales price in financing concessions but the number will be reduced to 3% later this year; the date has not been announced yet. The annual MIP for FHA loans will also probably be going up this year which will increase the monthly payment. Buyers who get in now will pay the lower fees.
6. Interest and property tax deduction – the U.S. is one of the few countries in the world that allow an interest and property tax deduction for homeowner/taxpayers.
7. Source of funds with deductible interest - a homeowner can borrow up to $100,000 above their acquisition debt and deduct the interest regardless of what purpose the money is used. This is a great opportunity to consolidate debt at a lower interest rate and be able to make the interest deductible that otherwise may not have been.
8. Capital gain exclusion – the U.S. allows qualified homeowners to make a profit on their home without having to pay tax on the gain.
9. Borrowing against equity is non-taxable event – taking money out of the equity in your home does not require recognizing capital gains income.
10. The combination of reasons to buy a home may never be stronger than now.
Interest rates are going up; it is just a matter of when. Inventories are starting to be absorbed by current demand. New home construction is down considerably which could lead to higher prices due to not enough annual housing units to keep up with the population. Prices have started to climb in some markets; others will surely follow.
A basic rule of investing is to buy low and sell high. There will be some buyers who take advantage of the current opportunities and will look back and remark how fortunate they were to act when they did. There will be others who look back on these conditions and say "We should have bought then." Hindsight is always 20/20. Evaluating the present and acting takes equally clear vision. The help of a trusted professional can make the difference.
Sunday, July 25, 2010
Should I Go Bankrupt versus Short Sale or Foreclosure?
First, let me get the legal portion out of the way-----I am a Realtor, not an Attorney, or a CPA, so before you do anything, I highly advise legal and financial assisstance from qualified people!
Now that's done, let's get back to the topic at hand. I am going to provide information that may or may not help you. I will be talking in general terms and everybody's circumstances are different, so what I tell you will hopefully give you some answers or at least point you toward finding the right answer for your circumstances.
Bankruptcy
People think that a bankruptcy will cleanse them of their debts. That is a myth. Here is why. Yes, it's true, that a Chapter 7 Bankruptcy will release a debtor of all debts. The problem is that most the bankruptcy laws were changed in 2005. This law makes it much harder to file a Chapter 7 bankruptcy. Now the judges have to steer debtors towards a Chapter 13.
What does a Chapter 13 bankruptcy mean? It means that a debtor will have to repay part (if not all) of their debts. In addition, the debtor has their finances managed by the bankruptcy trustee. And, the debtor has to pay that trustee!
AND, I have heard that 96% of the people that go into Chapter 13 are not able to complete the plan. Ask the attorney what happens if you can't make the payments the way the court sets it up. As I understand it, you are right back where you started with the crediters calling again.
Most big companies don't have the stomach to do the hard work of collecting money. That is why they farm that hard work out to a collection agency. What does the collection agency do? They just call the person over and over again.
Very few collection agencies are going to do what is actually necessary to force the borrower to pay. And that is file a lawsuit. If they ever do file a lawsuit, the court system is so backed up that it's hard to get a judgment. And what good does a judgment do them?
Statistics show that only 20% of all judgments ever get collected. Why do I tell you this? Because so many short sale sellers instead declare bankruptcy. They don't want to waste time on a short sale. So they don't do one.
Just remember, a bankruptcy stays on your credit for 7 years. And I have heard of people buying another home 1 year after a short sale. As far as foreclosure goes, Fannie Mae & Freddie Mac (government agencies that own about 50% of all mortgages) are talking 3-5 years before they will loan you money. We aren't sure of the actual number yet.
Again, as I started out this article, please get with an attorney and a tax person so you know legally what to expect. Should you have more questions, don't hesitate to leave a response below.
Now that's done, let's get back to the topic at hand. I am going to provide information that may or may not help you. I will be talking in general terms and everybody's circumstances are different, so what I tell you will hopefully give you some answers or at least point you toward finding the right answer for your circumstances.
Bankruptcy
People think that a bankruptcy will cleanse them of their debts. That is a myth. Here is why. Yes, it's true, that a Chapter 7 Bankruptcy will release a debtor of all debts. The problem is that most the bankruptcy laws were changed in 2005. This law makes it much harder to file a Chapter 7 bankruptcy. Now the judges have to steer debtors towards a Chapter 13.
What does a Chapter 13 bankruptcy mean? It means that a debtor will have to repay part (if not all) of their debts. In addition, the debtor has their finances managed by the bankruptcy trustee. And, the debtor has to pay that trustee!
AND, I have heard that 96% of the people that go into Chapter 13 are not able to complete the plan. Ask the attorney what happens if you can't make the payments the way the court sets it up. As I understand it, you are right back where you started with the crediters calling again.
Most big companies don't have the stomach to do the hard work of collecting money. That is why they farm that hard work out to a collection agency. What does the collection agency do? They just call the person over and over again.
Very few collection agencies are going to do what is actually necessary to force the borrower to pay. And that is file a lawsuit. If they ever do file a lawsuit, the court system is so backed up that it's hard to get a judgment. And what good does a judgment do them?
Statistics show that only 20% of all judgments ever get collected. Why do I tell you this? Because so many short sale sellers instead declare bankruptcy. They don't want to waste time on a short sale. So they don't do one.
Just remember, a bankruptcy stays on your credit for 7 years. And I have heard of people buying another home 1 year after a short sale. As far as foreclosure goes, Fannie Mae & Freddie Mac (government agencies that own about 50% of all mortgages) are talking 3-5 years before they will loan you money. We aren't sure of the actual number yet.
Again, as I started out this article, please get with an attorney and a tax person so you know legally what to expect. Should you have more questions, don't hesitate to leave a response below.
Saturday, July 24, 2010
Are You Under Water With Your Mortgage?
Alot of home owners today owe more on their mortgage than what the home is actually worth! I agree.....this suc........ Depending on the circumstances, there are possibly ways out of your problem! Now, don't get me wrong. I can't help everyone, just most.
Now, before I get into this subject further.......BEWARE......There are "people" (and I use that word loosely) out there that are trying to take advantage of you. When times get rough, the con men flourish! Don't sign anything you don't understand, you may be giving up the title to your home. Also, don't pay money up front!
My job as a Realtor is to assist you. They may be just providing information or answering questions, such as, "What are the differences between a short sale and a foreclosure and how will both effect my credit in the future?"
One example of information is the website where military personnel being reassigned, but owe more than they can sell their home for, can get help from the government.
For today's information, I am including an article from the Realtors' Magazine written by Melissa Dittmann Tracey. It discusses real estate scams. Please read it and don't allow yourself to become a victim.
5 Real Estate Scams You Need to Know About
Don't be duped by mortgage fraud. Here are a few common scams and the red flags you should look for in a transaction.
By Melissa Dittmann Tracey
Mortgage fraud is pervasive: An estimated $4 billion to $6 billion in annual losses result from mortgage fraud, according to FBI reports. “An entire community can be damaged by mortgage fraud,” says Rachel Dollar, a lawyer from Santa Rosa, Calif., and editor of the Mortgage Fraud Blog. Mortgage fraud can lead to a spike in foreclosures, home values plummeting, and lenders raising their rates and fees to recover losses.
The crimes are often complex, involving several parties and occurring over multiple transactions. To protect you and your clients, educate yourself about mortgage fraud and be on guard for any warning signs in a transaction.
1. The Foreclosure Rescue Scheme
The Scam: “Rescuers” promise cash-strapped home owners that they can save their home from foreclosure. The rescue, which involves paying upfront fees, can take multiple forms, such as the perpetrator obtaining a new loan on behalf of the owner or by having the owner sign over the home’s deed and then rent the home until they can repurchase it. Eventually, the home owner loses the home, either to foreclosure or the fictitious rescue company.
Red Flags: With foreclosure rescue programs, borrowers are often advised to sign over the title of their house to a third party, become renters of their home, not contact their lender, or send mortgage payments to a third party, according to Fannie Mae, which provides fact sheets on mortgage fraud.
2. Loan Documentation Fraud
The Scam: This fraud involves numerous schemes in which a borrower provides inaccurate financial information — such as about their income, assets, and liabilities — or employment status in order to qualify for a loan with lower rates and more favorable terms. Occupancy fraud is one growing area: Borrowers say they plan to live in the property when they actually intend to rent it.
Red Flags: Documentation may raise suspicion if the employer’s address is shown as a post office box, accumulation of assets compared to the person’s income appears too high or low, the new house is too small to accommodate occupants, the person has no credit history, or the application is unsigned or undated, according to Fannie Mae.
3. Appraisal Fraud
The Scam: A faulty appraisal — saying a property is worth more than what it really is — is connected to many types of mortgage fraud. It entails manipulating or overstating comparables, market values, or property characteristics in order to obtain a higher appraisal. The higher property appraisal, which generates false equity, is done by falsifying an appraisal document or using an appraiser accomplice to obtain the higher value.
Red Flags: Be skeptical of appraisals that are dated prior to the sales contract, list comparable sales that do not contain similarities to the property or are outside the neighborhood, the owner is not the seller listed on the contract or the title, or a third party participating in the transaction orders the appraisal, Freddie Mac warns.
4. Illegal Property Flipping
The Scam: This entails purchasing properties and reselling them at inflated prices. These scams usually involve faulty appraisals and inaccurate loan documents. The property is then refinanced or resold immediately after purchase for an inflated value. The home is purchased at a higher price, often by straw buyers working with the “flipper,” and eventually falls into foreclosure.
Red Flags: Some key things to look for are rapid refinancing of a property; the seller recently having acquired the title or acquiring the title concurrent with the transaction; an appraisal that comes in too high; a property that was recently in foreclosure being purchased at a much lower price than its sales price; or the owner listed on the appraisal and title not matching the seller on the sales contract, according to Fannie Mae.
5. Short Sales Schemes
The Scam: Borrowers owe more than the current value of their home so they fake financial hardship and no longer make their mortgage payments. An accomplice of the borrower then submits a low offer to purchase the property in a short sale agreement. The lender agrees to the short sale, unaware that it was premeditated. The property, after being purchased at the reduced price, is then often resold at the home’s actual value for profit.
Red Flags: The borrower suddenly defaults on the mortgage with no workout discussions with the lender, an immediate offer is made to a lender at a short sale price, the short sale offer is less than current market value, or a cash back is offered at closing to the delinquent borrower (disguised as “repairs” or other payouts, for example) and is not disclosed to the lender, according to Fannie Mae.
You can report instances of suspected mortgage fraud to www.Stopfraud.gov.
Melissa Dittmann Tracey is the multimedia Web producer of REALTOR® magazine. She can be reached at mtracey@realtors.org.
Now, before I get into this subject further.......BEWARE......There are "people" (and I use that word loosely) out there that are trying to take advantage of you. When times get rough, the con men flourish! Don't sign anything you don't understand, you may be giving up the title to your home. Also, don't pay money up front!
My job as a Realtor is to assist you. They may be just providing information or answering questions, such as, "What are the differences between a short sale and a foreclosure and how will both effect my credit in the future?"
One example of information is the website where military personnel being reassigned, but owe more than they can sell their home for, can get help from the government.
For today's information, I am including an article from the Realtors' Magazine written by Melissa Dittmann Tracey. It discusses real estate scams. Please read it and don't allow yourself to become a victim.
5 Real Estate Scams You Need to Know About
Don't be duped by mortgage fraud. Here are a few common scams and the red flags you should look for in a transaction.
By Melissa Dittmann Tracey
Mortgage fraud is pervasive: An estimated $4 billion to $6 billion in annual losses result from mortgage fraud, according to FBI reports. “An entire community can be damaged by mortgage fraud,” says Rachel Dollar, a lawyer from Santa Rosa, Calif., and editor of the Mortgage Fraud Blog. Mortgage fraud can lead to a spike in foreclosures, home values plummeting, and lenders raising their rates and fees to recover losses.
The crimes are often complex, involving several parties and occurring over multiple transactions. To protect you and your clients, educate yourself about mortgage fraud and be on guard for any warning signs in a transaction.
1. The Foreclosure Rescue Scheme
The Scam: “Rescuers” promise cash-strapped home owners that they can save their home from foreclosure. The rescue, which involves paying upfront fees, can take multiple forms, such as the perpetrator obtaining a new loan on behalf of the owner or by having the owner sign over the home’s deed and then rent the home until they can repurchase it. Eventually, the home owner loses the home, either to foreclosure or the fictitious rescue company.
Red Flags: With foreclosure rescue programs, borrowers are often advised to sign over the title of their house to a third party, become renters of their home, not contact their lender, or send mortgage payments to a third party, according to Fannie Mae, which provides fact sheets on mortgage fraud.
2. Loan Documentation Fraud
The Scam: This fraud involves numerous schemes in which a borrower provides inaccurate financial information — such as about their income, assets, and liabilities — or employment status in order to qualify for a loan with lower rates and more favorable terms. Occupancy fraud is one growing area: Borrowers say they plan to live in the property when they actually intend to rent it.
Red Flags: Documentation may raise suspicion if the employer’s address is shown as a post office box, accumulation of assets compared to the person’s income appears too high or low, the new house is too small to accommodate occupants, the person has no credit history, or the application is unsigned or undated, according to Fannie Mae.
3. Appraisal Fraud
The Scam: A faulty appraisal — saying a property is worth more than what it really is — is connected to many types of mortgage fraud. It entails manipulating or overstating comparables, market values, or property characteristics in order to obtain a higher appraisal. The higher property appraisal, which generates false equity, is done by falsifying an appraisal document or using an appraiser accomplice to obtain the higher value.
Red Flags: Be skeptical of appraisals that are dated prior to the sales contract, list comparable sales that do not contain similarities to the property or are outside the neighborhood, the owner is not the seller listed on the contract or the title, or a third party participating in the transaction orders the appraisal, Freddie Mac warns.
4. Illegal Property Flipping
The Scam: This entails purchasing properties and reselling them at inflated prices. These scams usually involve faulty appraisals and inaccurate loan documents. The property is then refinanced or resold immediately after purchase for an inflated value. The home is purchased at a higher price, often by straw buyers working with the “flipper,” and eventually falls into foreclosure.
Red Flags: Some key things to look for are rapid refinancing of a property; the seller recently having acquired the title or acquiring the title concurrent with the transaction; an appraisal that comes in too high; a property that was recently in foreclosure being purchased at a much lower price than its sales price; or the owner listed on the appraisal and title not matching the seller on the sales contract, according to Fannie Mae.
5. Short Sales Schemes
The Scam: Borrowers owe more than the current value of their home so they fake financial hardship and no longer make their mortgage payments. An accomplice of the borrower then submits a low offer to purchase the property in a short sale agreement. The lender agrees to the short sale, unaware that it was premeditated. The property, after being purchased at the reduced price, is then often resold at the home’s actual value for profit.
Red Flags: The borrower suddenly defaults on the mortgage with no workout discussions with the lender, an immediate offer is made to a lender at a short sale price, the short sale offer is less than current market value, or a cash back is offered at closing to the delinquent borrower (disguised as “repairs” or other payouts, for example) and is not disclosed to the lender, according to Fannie Mae.
You can report instances of suspected mortgage fraud to www.Stopfraud.gov.
Melissa Dittmann Tracey is the multimedia Web producer of REALTOR® magazine. She can be reached at mtracey@realtors.org.
Wednesday, July 7, 2010
Do YOU Understand the FHA Loan?
7 Things All Borrowers Should Know About FHA Loans
RISMEDIA, July 1, 2010--FHA Pros, LLC, a national FHA condo approval service, has developed a list of facts speaking to the top misconceptions associated with FHA loans in order to help home buyers better navigate an already confusing market. FHA loans are mortgages issued by qualified lenders and insured by the Federal Housing Administration (FHA).
“We have seen home buyer interest in FHA loans go from practically zero three years ago to upwards of 87 percent today,” said Christopher Gardner, founder and president of FHA Pros, LLC. “Despite this rapid rise in popularity, many buyers still do not fully understand the benefits of these loans, and we believe it’s time to change that.”
1. FHA Loans Are Not Only For Lower-Income Borrowers. FHA loans are available to everyone. In fact, even Bill Gates can get one. There is no maximum income restriction associated with FHA loans. Borrowers do need to substantiate income and assets by submitting proper documentation. This requirement ensures that borrowers are well-vetted and truly able to afford their future homes.
2. FHA Loans Are Not Only For First-Time Buyers. Many people believe FHA loans are available only to first-time homebuyers. This is not the case. Whether borrowers are making their first home purchase or their fifth, they can look to FHA loans as a home financing option.
3. FHA Loans Are Not Just Small Loans; In Fact, Loan Amounts Can Be As High As Almost $800,000. The government recently raised the maximum loan amount from its original cap of $362,790 to $793,750 as a way to help stabilize the housing market. The amount a buyer can borrow varies from county to county. Later this summer, condo buyers interested in FHA loans can visit www.checkfhaapproval.com to instantly identify FHA-approved condo associations and review maximum loan amounts for a given location.
4. FHA Loans Are Not Affiliated With The Section 8 Housing Program. While both programs are administered by the U.S. Department of Housing and Urban Development (HUD), FHA loans have nothing to do with low-income subsidized housing. FHA loans are simply mortgages insured by FHA. This insurance provided by the federal government allows lenders to lend more freely by assuring them that they will be repaid in the event of default. Most traditional lenders, including Wells Fargo & Co., JP Morgan Chase and Citigroup are able to provide FHA loans to their customers.
5. FHA Loans Are Often More Affordable Than Conventional Loans. While FHA loans typically offer the same interest rates as other loans, borrowers benefit from a much lower down payment of as low as 3.5 percent.
6. FHA-Approved Condo Developments Are More Desirable To Buyers. With 87 percent of home buyers indicating that they plan to use FHA loans, condo associations that are not FHA approved are missing out on a significant pool of prospective buyers. Under rules in place since February 2010, an entire condominium development must now apply to HUD and be granted FHA approval before a buyer can purchase a unit in an association with an FHA loan or before an existing unit owner can refinance into an FHA loan.
Due to the general unwillingness of today’s lenders to extend credit with respect to conventional loans, many borrowers find that FHA is their best bet. Lenders don’t mind lending when the federal government (FHA) assures them of repayment.
Homeowners associations (HOAs) should note that although FHA-insured mortgages might be easier to obtain, they are not “risky” loans, due in large part to the strict “full documentation” requirements placed on borrowers.
Individual buyers or sellers can initiate the approval process or current owners can encourage their HOA to apply. More information about the FHA- approval process is available at www.getfhaapproval.com.
7. FHA Loans Are Assumable. In addition to lower down-payment and credit-qualifying requirements as compared to conventional loans, FHA loans are assumable. This means that when a seller with an FHA loan sells his or her property, the loan and its financing terms (interest rate) can be transferred to the new buyer. This unique feature will certainly make a property more valuable in times of rising interest rates.
“Now, more than ever, buyers and sellers need to understand the options available to them when it comes time to buy a home,” continued Gardner. “At FHA Pros we have worked with countless HOAs, attorneys and individuals to easily and efficiently navigate the historically tricky FHA-approval process.”
RISMEDIA, July 1, 2010--FHA Pros, LLC, a national FHA condo approval service, has developed a list of facts speaking to the top misconceptions associated with FHA loans in order to help home buyers better navigate an already confusing market. FHA loans are mortgages issued by qualified lenders and insured by the Federal Housing Administration (FHA).
“We have seen home buyer interest in FHA loans go from practically zero three years ago to upwards of 87 percent today,” said Christopher Gardner, founder and president of FHA Pros, LLC. “Despite this rapid rise in popularity, many buyers still do not fully understand the benefits of these loans, and we believe it’s time to change that.”
1. FHA Loans Are Not Only For Lower-Income Borrowers. FHA loans are available to everyone. In fact, even Bill Gates can get one. There is no maximum income restriction associated with FHA loans. Borrowers do need to substantiate income and assets by submitting proper documentation. This requirement ensures that borrowers are well-vetted and truly able to afford their future homes.
2. FHA Loans Are Not Only For First-Time Buyers. Many people believe FHA loans are available only to first-time homebuyers. This is not the case. Whether borrowers are making their first home purchase or their fifth, they can look to FHA loans as a home financing option.
3. FHA Loans Are Not Just Small Loans; In Fact, Loan Amounts Can Be As High As Almost $800,000. The government recently raised the maximum loan amount from its original cap of $362,790 to $793,750 as a way to help stabilize the housing market. The amount a buyer can borrow varies from county to county. Later this summer, condo buyers interested in FHA loans can visit www.checkfhaapproval.com to instantly identify FHA-approved condo associations and review maximum loan amounts for a given location.
4. FHA Loans Are Not Affiliated With The Section 8 Housing Program. While both programs are administered by the U.S. Department of Housing and Urban Development (HUD), FHA loans have nothing to do with low-income subsidized housing. FHA loans are simply mortgages insured by FHA. This insurance provided by the federal government allows lenders to lend more freely by assuring them that they will be repaid in the event of default. Most traditional lenders, including Wells Fargo & Co., JP Morgan Chase and Citigroup are able to provide FHA loans to their customers.
5. FHA Loans Are Often More Affordable Than Conventional Loans. While FHA loans typically offer the same interest rates as other loans, borrowers benefit from a much lower down payment of as low as 3.5 percent.
6. FHA-Approved Condo Developments Are More Desirable To Buyers. With 87 percent of home buyers indicating that they plan to use FHA loans, condo associations that are not FHA approved are missing out on a significant pool of prospective buyers. Under rules in place since February 2010, an entire condominium development must now apply to HUD and be granted FHA approval before a buyer can purchase a unit in an association with an FHA loan or before an existing unit owner can refinance into an FHA loan.
Due to the general unwillingness of today’s lenders to extend credit with respect to conventional loans, many borrowers find that FHA is their best bet. Lenders don’t mind lending when the federal government (FHA) assures them of repayment.
Homeowners associations (HOAs) should note that although FHA-insured mortgages might be easier to obtain, they are not “risky” loans, due in large part to the strict “full documentation” requirements placed on borrowers.
Individual buyers or sellers can initiate the approval process or current owners can encourage their HOA to apply. More information about the FHA- approval process is available at www.getfhaapproval.com.
7. FHA Loans Are Assumable. In addition to lower down-payment and credit-qualifying requirements as compared to conventional loans, FHA loans are assumable. This means that when a seller with an FHA loan sells his or her property, the loan and its financing terms (interest rate) can be transferred to the new buyer. This unique feature will certainly make a property more valuable in times of rising interest rates.
“Now, more than ever, buyers and sellers need to understand the options available to them when it comes time to buy a home,” continued Gardner. “At FHA Pros we have worked with countless HOAs, attorneys and individuals to easily and efficiently navigate the historically tricky FHA-approval process.”
Tuesday, July 6, 2010
Hot Summer in Central Virginia
Hey folks,
It is turning out to be another hot one here in Central Virginia. The "Weather Do-Dad on my screen says 98, and its only 3:15 in the afternoon. Now you know why I am in front of my computer......it's cool in here (at least until the electric bill comes). My dog doesn't even want to go out (talk about Dog Days). The weather here has turned hot early this year. Usually 100 degree days wait until late July, but we have had 5 days at 100 or better and already set 3 new high temps. We also need rain, as we got about 1/2 inch in June.
No, I'm not looking for a job at the Weather Channel, and Yes, this is a real estate blog!!
So, interest rates are BELOW 5% (depending on your credit score) and according to one of the sources I watch, housing prices, across the country, are down by an average of 24% from the price peak. I don't feel they are down that much here in Chesterfield County, but probably in the 15-18% range.
Any way you look at it, now is a great time to buy. The only problem we seem to be having is getting the present house sold, so they can buy another one.
When you listen to statistics, approximately 1/7 of the population (which comes out to about 14.28%) moves every year. I did my own study and pulled 8 neighborhoods in my area, covering from starter home subdivisions to executive type subdivisions. By getting the number of homes in each subdivision, and dividing by the number of sales in the last 12 months, I came up with the percentage of homes sold for that subdivision.
The lowest percentage was 2.70% in a neighborhood that sells around$180,000-$225,000. And that was the subdivision I used to live in (12 years ago). The highest percentage was in the smallest subdivision, with about the same price homes, at 7.14%. The other 6 subdivisions ran from 3.44% to 4.31%. That comes out about 4.15% for all of them. I think we must be at the bottom....at least I hope so.
For those of you thinking about buying or selling a home in the future, I want you to stop before signing that listing agreement or that contract. I'm sure your parents told you the following, sometime in your life! Don't sign ANYTHING that has blanks in it. Make sure all the blanks are filled in, either with a number, words or a line. Remember, a blank could be filled in later. You would be surprised at the "lousy" written listing agreements and contracts I have seen over the years, even from experienced agents.
Be careful out there!!!!
Oh, one last thing. If you would like a Lowe's $10 off coupon, shoot me an email and I will put you on the list to get one!
It is turning out to be another hot one here in Central Virginia. The "Weather Do-Dad on my screen says 98, and its only 3:15 in the afternoon. Now you know why I am in front of my computer......it's cool in here (at least until the electric bill comes). My dog doesn't even want to go out (talk about Dog Days). The weather here has turned hot early this year. Usually 100 degree days wait until late July, but we have had 5 days at 100 or better and already set 3 new high temps. We also need rain, as we got about 1/2 inch in June.
No, I'm not looking for a job at the Weather Channel, and Yes, this is a real estate blog!!
So, interest rates are BELOW 5% (depending on your credit score) and according to one of the sources I watch, housing prices, across the country, are down by an average of 24% from the price peak. I don't feel they are down that much here in Chesterfield County, but probably in the 15-18% range.
Any way you look at it, now is a great time to buy. The only problem we seem to be having is getting the present house sold, so they can buy another one.
When you listen to statistics, approximately 1/7 of the population (which comes out to about 14.28%) moves every year. I did my own study and pulled 8 neighborhoods in my area, covering from starter home subdivisions to executive type subdivisions. By getting the number of homes in each subdivision, and dividing by the number of sales in the last 12 months, I came up with the percentage of homes sold for that subdivision.
The lowest percentage was 2.70% in a neighborhood that sells around$180,000-$225,000. And that was the subdivision I used to live in (12 years ago). The highest percentage was in the smallest subdivision, with about the same price homes, at 7.14%. The other 6 subdivisions ran from 3.44% to 4.31%. That comes out about 4.15% for all of them. I think we must be at the bottom....at least I hope so.
For those of you thinking about buying or selling a home in the future, I want you to stop before signing that listing agreement or that contract. I'm sure your parents told you the following, sometime in your life! Don't sign ANYTHING that has blanks in it. Make sure all the blanks are filled in, either with a number, words or a line. Remember, a blank could be filled in later. You would be surprised at the "lousy" written listing agreements and contracts I have seen over the years, even from experienced agents.
Be careful out there!!!!
Oh, one last thing. If you would like a Lowe's $10 off coupon, shoot me an email and I will put you on the list to get one!
Sunday, June 20, 2010
Foreclosure vs Short Sale
FORECLOSURE vs SHORT SALE
This issue has been pushed into the forefront of real estate in this area of late. It is not a subject I prefer to talk about, BUT, alot of people don't understand what either term can mean to them. And if you are headed toward foreclosure, you need to understand what it means, especially to you!
This issue has been pushed into the forefront of real estate in this area of late. It is not a subject I prefer to talk about, BUT, alot of people don't understand what either term can mean to them. And if you are headed toward foreclosure, you need to understand what it means, especially to you!
First, I need to disclose my position. I am a Realtor......I am NOT an attorney. I highly advise anyone getting into the foreclosure position, "Call an Attorney!" There, I have done what the state requires me to do.
Now, I will attempt to answer questions that you may have concerning foreclosure and/or short sales. If I don't answer your specific question, you can leave a response below OR, you can send an email to Woody419@gmail.com and I will respond directly to you.
Let's get into some definitions:
Foreclosure - Due to the homeowner not fulfilling some portion of the mortgage papers that were signed at closing, usually not making the payment, the bank can and will call the note due. If the homeowner, for whatever reason, can't catch up on the payments, the bank proceeds through the courts and will sell your note on the courthouse steps.
MOST of the time, the bank buys it back, because no one bids the amount of what is owed. At this point, the bank preceeds to vacate the house, change the locks and eventually put the house on the market and attempt to sell it for the amount owed or more if possible. In todays market, the bank usually loses money on the original debt, plus they have additional costs of getting possession of the home, namely in lawyer fees and court costs.
Short Sale - The term basically explains what happens! The home is sold for less than is owed on it! Now, think about what I just said! Sold for less than is owed on it! Why would the bank allow that to happen? The bank does not have to allow it to happen, the bank has the final word.
Basically, what happens on a short sale is.....A Realtor comes in and does a CMA (comparitive market analysis) or as the banks like to call it, A BPO (broker price opinion) to determine what the home is worth TODAY. The CMA and the listing agreement are forwarded to the bank involved, plus paperwork provided by the home owner.
The owner is required to turn in his/hers/joint last 2 tax returns, bank statements, pay stubs, etc. I know, it sounds just like what the "buyer" has to turn in when applying for a loan. It is!!!!!!! Only this time, the owner is trying to show that they CAN"T afford the loan payments, or applying for a loan in reverse.
The Banks
The banks normally only allow short sales for a handful of reasons:
1. Job Loss of one of the lienholders
2. Death of one of the leinholders
3. Job transfer
4. Major medical bills
Now, none of what I have stated in this blog, is "set in stone", so don't hold me to this. The senerio of short sales is so new to the industry, there are no "set rules". Each bank has their own rules, and even those are changing daily. What worked a month ago might not work today.
A question many of you may be having about now is, "Who pays for everything to sell a home as a short sale." Like I said earlier, "Usually" the bank pays for all the closing costs. Remember, the home is being sold for less than is owed on it.
If a homeowner can't afford to sell the home, pay Realtor and attorney fees, release fees and any other associated fees with selling, then it becomes a short sale and the bank picks up the costs. Now, this only happens when the bank gives their approval of the short sale.
AND, the homeowner will not walk away with any money from the closing, if the bank has to pay any expenses.
Final Thought
There is one more item I want to discuss. If the bank approves the short sale, and the home is sold for less than owed, or if the home is foreclosed on, the bank has the right to come after you later to make you pay the difference. It is discussed in that stack of paperwork you signed at closing when you bought your home.
Some banks aren't coming after the homeowners for the money. Some are reporting the difference as a capital gain which has to be reported as income on your tax return. One of my jobs is to attempt to get a form from the bank stating they forgive the debt. Some Realtors don't even know that can be done
Now, I'm sure you can understand why I said to contact an attorney. You might also want to discuss this with your tax person. Whatever your situation, don't ignore it, talk to somebody. It won't go away.
I don't have all the answers, but on my team, 2 of us have specific training for short sales. We have a form that can get the bank to stop calling and harassing you. So, if what I have talked about today hits home and you want to talk about it, give me a call.
(804) 712-8801
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