Is The Housing Market Improving in Jupiter Florida?

by Rodney Forbes on September 30, 2012

West Palm Beach Short Sale RealtorIt’s no secret the housing market in Jupiter Florida has taken a plunge in the past few years and selling a home in Jupiter seems like an almost impossible task. Homeowners in Jupiter, FL have waited months, and some, even years to get out from under their homes. For the homeowner who is looking to sell whether it’s through a short sale or a regular real estate sale, the market has budged and is beginning to look promising for the future. Now, a lot of people wonder how to find out if the housing market is improving or not or what to look for.

The first thing anyone wants to look for is the amount of foreclosures in any neighborhood; this is a great indicator of how good or bad the real estate market is on a local level. If you find fewer foreclosures in a neighborhood, this is typically a sign of a relatively stable neighborhood but if you find a large number of foreclosures then this could be a sign that particular area is seeing a housing market depression. For the buyer, foreclosed homes could be a good place to look if you plan on buying a home to fix up to your liking.

Another way to tell if the housing market is improving is when housing companies start building large projects in your area, this is good because a good amount of homeowners are expected to move in soon. Housing projects are always a good sign, it shows your local housing market to be making a steady move towards recovery and you are less likely to see foreclosures in that area.

Lower interest rates are another way to tell if the market is improving. Interest rates have seen a huge decline since the housing market took its plunge. Lower interest rates don’t always mean a bad real estate market but since interest rates are at a decrease it is an incentive for buyers who are looking to buy a home. The more money the real estate market sees, the quicker its recovery can increase and the housing market can get back to normal.

If you start seeing business pop up around you or old businesses that closed down but are now reopening their doors, then this is a possible sign of an improving housing market. This is particularly good for the entire economy too because more people will be spending money as well as making money and more money means more homes, which means more jobs so the homes can be built.

The real estate market is showing signs of improving however, more jobs and fewer foreclosures seem to be holding both the economy and the real estate market back from being able to become stable. For buyers, right now would more than likely be your ideal time to buy, but sellers, just keep at it, and make sure you are choosing the right Realtor to help you with your real estate transactions, whether it be a short sale or a regular home sale, competent Realtors are out there and do better your chances of getting you out of your home.

Rodney Forbes is a Realtor® and registered broker with Forbes Realty of South Florida, based in West Palm Beach Florida. Rodney and his team work in Palm Beach, Broward, Martin and St. Lucie Counties. As a recognized expert on short sales, Rodney has been featured on radio and national web conferences for agents. Rodney has also authored the book “Should I Short Sale My Home?”

Forbes Realty of South Florida also specializes in REO asset disposition. Rodney works with several banks and asset managers in the Palm Beach County area. Rodney is the main author for the popular real estate blog South Florida Real Estate Report. You can find a wealth of information regarding bank foreclosures, short sales, real estate news and local real estate trends.

For more information, please call Rodney at 561-337-4810 or email Rodney@ForbesRealtyOnline.com

 

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Short sales are one of the alternatives to avoid a foreclosure that a home owner can select. They do have their pros and cons, but some experts tend to believe the benefits of a short sale override the cons especially if the homeowner sees no change in his/her finances. But whether it’s advantageous for both lender and borrower, a short sale still is a process that takes a long time to complete and often undergoes various steps with each step mandatory for an approval.

West Palm Beach Short Sale RealtorSo, why does a short sale take such a long time to accomplish? A short sale, typically involves the homeowner asking the lender to obtain a lesser amount than what is owed to him. If you were in the lender’s position, you’d naturally think the choice over a hundred times before agreeing to a loss. Mulling this loss over naturally involves time; weeks or even months. Short sales take an average of 245 days to push through.

Likewise, for the lender to consent, the homeowner must give valid evidence that a short sale is necessary. An appearing foreclosure is substantial evidence since lenders themselves do not want to go through with the expensive process of foreclosing. This and the fact that the property will go to the bad debts section and probably incur taxes while under such classification. It also takes time and money to resell a foreclosed property. In a short sale, a willing buyer is usually already waiting.

So, does being successful in a short sale all rely on the lender? Here are a few more answers to the question – Why do short sales take so long to complete?

Inexperienced Realtor

While the processes of selling a home under a short sale seem somewhat similar to a regular sale, it would be great for a homeowner to seek after the assistance of a Realtor or real estate agent experienced in short sales. Since a lender requires that a home being listed for a short sale should already have a willing buyer, a competent real estate agent is needed to help both buyer and homeowner go through the long months of waiting for the short sale to be approved. But before this, there are steps that a homeowner cannot handle himself. This will involve getting a reputable appraiser, listing the home for short sale and many more. In total, a homeowner should not just seek after for a licensed real estate agent, but one who specialize in short sales.

Even though a short sale could be one of the best alternatives a homeowner can consider to avoiding foreclosure, it still takes a long time to complete. The sequence of events above are just a few of the reasons why short sales take so long to complete, and understanding each can help a homeowner prepare for the long waiting period; if not achieve a faster approval.

Mortgage Insurance

West Palm Beach Short Sale RealtorThe holder of the mortgage insurance or MI is another one of the third parties involved in short sale. Most mortgages are covered with a mortgage insurance that guards the lender in case the borrower defaults on the payments. In the matter of a short sale, the borrower would have defaulted on the payments so the insurance provider’s approval is needed since an amount will typically be paid to the lender to cover the default. Additionally, this process involves paperwork and a step-by-step approval process.

Homeowner Must Package Correct Paperwork

Additionally to an appearing foreclosure, a homeowner should provide the right paperwork to get approved for a short sale. For one reason being, the lender will require proof that the home’s market value is less than the remaining amount of the mortgage. This proof should be proposed in an appraisal report from an independent and reputable appraiser. Other requirements that a lender may find necessary include the short sale hardship letter explaining the homeowner’s aggrieved situation, pay stubs, tax returns, and bank statements. If a homeowner qualifies for the government-backed short sale program under Realtor, the requirements would include applying for the HAMP loan modification program first, evidence that monthly payments exceed 31% of income and the hardship letter.

So if you are a homeowner wanting to sell your home through a short sale, you should make sure you have submitted the right paperwork prior questioning why short sales take so long to complete. Because by the time your paperwork has been reviewed and rejected due to a missing requirement, weeks or months would have already passed. In this bad economic time that the real estate is in, mortgage lenders are processing hundreds of short sale applications on any single time.

Second or Third Mortgages

West Palm Beach Short Sale RealtorAnother thing a homeowner should take into consideration before asking as to why short sales take so long to complete is a second or third mortgage. Having more than one mortgage for a home isn’t unusual. When a homeowner falls short of the required down payment, he/she might be forced to get a second mortgage to cover the difference. A second mortgage could have also been taken to cover the difference between a low appraisal/the amount the bank was willing to lend, and the higher asking price of the seller.

Whether of a second or third mortgage, a homeowner looking out for a short sale as an alternative to refrain from foreclosure should also get the second or third lender’s approval. This process takes time because a lender will usually not agree to let go of his lien over the property without anything in exchange or valid proof that a short sale is the only option available.

Rodney Forbes is a Realtor® and registered broker with Forbes Realty of South Florida, based in West Palm Beach Florida. Rodney and his team work in Palm Beach, Broward, Martin and St. Lucie Counties. As a recognized expert on short sales, Rodney has been featured on radio and national web conferences for agents. Rodney has also authored the book “Should I Short Sale My Home?”

Forbes Realty of South Florida also specializes in REO asset disposition. Rodney works with several banks and asset managers in the Palm Beach County area. Rodney is the main author for the popular real estate blog South Florida Real Estate Report. You can find a wealth of information regarding bank foreclosures, short sales, real estate news and local real estate trends.

For more information, please call Rodney at 561-337-4810 or email Rodney@ForbesRealtyOnline.com

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Ways to Avoid a Foreclosure in Jupiter Florida

by Rodney Forbes on September 30, 2012

West Palm Beach Short Sale RealtorFor homeowners that dealing with a financial crisis, essentially any alternative to foreclosure is gladly received. Nonetheless, choosing the suited foreclosure alternative may be challenging. There are a huge number of factors that can affect a homeowner’s decision: their short term financial circumstance, their long term income anticipation, their assets, interest rates, the internal policies of their lender, the present as well as future market value of their home, even ethical and moral values may come to play.

To make things obscure, a great deal of the advice on foreclosure alternatives comes from self-interested parties with a “dog in the race”, so to speak. These may be lenders who are advantageous from loan modification, 3rd parties that make homeowners pay for guidance through strategic default, and individuals acclaiming themselves as experts in short sales or foreclosure avoidance, who in reality may have little experience or training on the subject matter.

With so many different concepts to consider and so much conflicting information out there, and such an important decision to be made, how can a homeowner abstain from a foreclosure and pick the best foreclosure alternative for their situation? Here below, we take a look at the pros and cons of a few of the major alternatives to foreclosure.

How to Avoid Foreclosure – Alternatives to Foreclosure
Loan Modifications

Loan modifications are often proclaimed as a technique to avoiding foreclosure. Homeowners facing with potential foreclosure are often recommended to contact their lenders and work out a loan modification, where the lender alters the terms of the mortgage in order to help the homeowner remain in their home. As for the lender, it can be reasonable to accept smaller payments over a longer amortization period, temporarily freezing interest rates, or delayed payment rather than accept the losses they would face with a foreclosure, particularly where the property value of the home has severely declined.

West Palm Beach Short Sale RealtorWhile loan modification programs may be beneficial for the lender, for most aggrieved homeowners, loan modifications are a short solution that benefits the lender as opposed to the homeowner. If the property value of the borrower’s home has decreased to a point where it is significantly lower than the value of the mortgage, the homeowner will still be making Realtor mortgage payments for a home worth significantly less than what they are paying, all the while incurring further debt. If the homeowner as well dealing with unemployment or a significantly reduced income, then it is not likely that they will be capable of continuing to make mortgage payments in the long run. Thus, a loan modification may only prolong the inevitable.

On the other hand, loan modifications may be appropriate in other situations where the reason being for the homeowner’s financial trouble is a short term one, verses the long term financial problems that come with sharply declining property values and significantly reduced income.

Short Sale

When facing foreclosure, a short sale is where the homeowner gets approval from the lender to sell the home for less than the value of their debt. In some states, non-recourse laws stop the lender from legally pursuing a judgment against the borrower for the debt remaining after the secured property has been purchased, meaning the homeowner is excused. In those states without non-recourse laws, the homeowner can classify a short sale with the help of a short sale specialist and negotiate a written agreement from their lending institution forfeiting their right to sue for the deficiency (the remaining debt owed by the homeowner after the home is sold). In return, the lender receives the proceeds of sale of the home without the legal and administrative costs associated with the foreclosure process.

The downside to a short sale is that if you are in a recourse state and you still have significant assets, you will most likely still be personally responsible for the deficiency when the home sells for less than the value of the outstanding debt. Adding to this, there are few Realtors with the experience mandatory to support the complexities of a short sale. The homeowner must be very diligent in screening Realtors in order to emerge from a short sale with a positive outcome. However, with an experienced short sale specialist, a short sale may authorize the homeowner to salvage their credit, have their debt forgiven, and also avoid the public humiliation and spectacle of a foreclosure.

Deed In Lieu Of Foreclosure

West Palm Beach Short Sale RealtorThere is one more foreclosure alternative to be aware of, the deed in lieu of foreclosure. A deed in lieu of foreclosure is similar in concept to a short sale, except on behalf of selling the home, you hand back the home to the lender and in exchange, the lender will terminate foreclosure proceedings or amend not to decree foreclosure proceedings. Like with a short sale, it is important to negotiate a forgiveness of the deficiency if you are in a recourse state, or you may still be liable for the deficiency after the bank receives the deed.

The downside to a deed in lieu of foreclosure is that it can be rather challenging to get the lender to admit a deed in lieu. It is significantly easier to get a lender to agree to a short sale. As a matter of fact, many lenders will require you to put your home on the market for a certain timeframe before they will take into consideration a deed in lieu of foreclosure. With a short sale, you come to the lender with an offer and a buyer ready to pay, while with a deed in lieu of foreclosure you’re asking the lender to accept the deed to the property.

Which Foreclosure Alternative Is Right For You?

Even armed with information regarding ways you can prevent foreclosure and choose a preferable alternative to foreclosure, it can be confusing to know which option suites best for your particular case.

Generally speaking, a loan modification is the best resolution when the cause of the missed mortgage payments or financial difficulty is simply a short term cash flow problem. Perhaps, this could be medical emergency, sudden major repairs to the property, a car accident, or another long term financial crisis. Unfortunately for most homeowners, the cause of their distress isn’t a short term cash flow problem. If the root of the issue is because of a significantly reduced income or a sudden decline in property values, then a loan modification will generally be inadequate as a long term solution. In fact, it may cost the homeowner more in the long run, as they struggle to keep up with loan payments, only to inevitably end up back where they started seeking other options to foreclosure.

West Palm Beach Short Sale RealtorThe deed in lieu of foreclosure offers a number of benefits over loan modification. It allows the homeowner to potentially get a fresh start while avoiding many of the psychological and financial consequences of a foreclosure. However, it can be difficult to obtain a deed in lieu as lenders typically would prefer cash over the deed. This leaves the short sale as the best option to foreclosure where the cause of the homeowner’s financial distress is due to unemployment, significantly reduced income, or where the value of the property has dropped significantly. As mentioned previously, if you decide to take advantage of a short sale as an alternative to foreclosure, it is extremely important to find an experienced short sale Realtor who can handle the complexities of a short sale transaction. But with the proper representation, a short sale could be the alternative to foreclosure you’re looking for.

Rodney Forbes is a Realtor® and registered broker with Forbes Realty of South Florida, based in West Palm Beach Florida. Rodney and his team work in Palm Beach, Broward, Martin and St. Lucie Counties. As a recognized expert on short sales, Rodney has been featured on radio and national web conferences for agents. Rodney has also authored the book “Should I Short Sale My Home?”

Forbes Realty of South Florida also specializes in REO asset disposition. Rodney works with several banks and asset managers in the Palm Beach County area. Rodney is the main author for the popular real estate blog South Florida Real Estate Report. You can find a wealth of information regarding bank foreclosures, short sales, real estate news and local real estate trends.

For more information, please call Rodney at 561-337-4810 or email Rodney@ForbesRealtyOnline.com

 

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West Palm Beach Short Sale RealtorIs it possible for a homeowner with a flawless mortgage payment history to get approved of a short sale? We all know that short sale, an alternative to foreclosure, is a practicable option among defaulting homeowners. But for those who have stably kept their home loan payments, is there a way for them to give up their loan without having to go on default?

The answer to this is, usually yes! Mortgage lenders want to work with borrowers who have an excellent payment record and are attempting to apply for a short sale. In recent years, a rising number of borrowers who are current on their mortgage payments have applied for a short sale on their homes. Majority of these cases are even approved by lenders right away.

There are multiple accounts why borrowers with no late payments would be for a short sale. There are homeowners who feel that their residential property is underwater while some feel that the appraised value of their homes has substantially decreased a few years after its purchase. There are responsible homeowners who believe that they should be provided the opportunity to short sale on their property as it is the right financial decision to make. Borrowers who are on track with their mortgage payments may have the means to pay for their mortgage today, but foresee issues that may influence their capability of paying on time in the future. This is what the real-estate market calls as imminent default.

The reasons mentioned above may not be enough for lenders to approve a short sale for good paying homeowners. The cause for requesting a short sale should be critical and valid for mortgage companies to even consider you for loan modification alternatives.

Listed below are valid reasons from good-paying homeowners who were approved a short sale:

 

• Job layoff or reduced income

A lot of homeowners are experiencing financial challenges due to hard economic times. A reduction in the number of working hours, reduced income, or getting laid off from work are common reasons why good-paying borrowers are requesting for a short sale proceeding to ensue. Instead of waiting for these unfortunate conditions to happen, homeowners who anticipate considerable losses will most likely inquire about the short sale process to their respective lenders.

• Job relocation

West Palm Beach Short Sale RealtorHomeowners who need to surrender their homes because of job relocation are given a chance to short sale their primary residence. Since keeping two homes in two different locations almost and always leads to hardship, lenders will probably agree to a short sale instead.

• Divorce

Divorce always leads to one of the former partners to move out of the household. A single parent who needs to solely take care of the finances and pay for children needs will sooner or later face financial difficulties in the long run. Instead of enduring hardship, a homeowner may opt to short sale on the property to avoid late charges and delinquency fees.

• Loss of job

There are unemployed homeowners who are still capable of making on time mortgage payments. Nevertheless, they may only be getting their money from personal savings and not from income. At some point in time, they will be short of enough financial resources to cover for mortgage. Some borrowers don’t wait for their resources to dwindle before they request for a short sale. Since default is already at hand, a mortgage lender will approve a short sale to borrowers with good mortgage payment history.

Why do Mortgage Lenders approve of Short Sales among Good-Paying Borrowers?

Short sales are approved when bank or mortgage companies perceive that it is a better financial decision not to pursue a foreclosure. Short sale is a better alternative to mortgage lenders if their losses are kept to a minimum. Additionally, foreclosure proceedings usually last longer to furnish and complete. This means that foreclosure associated costs are bigger; more complicated, and time consuming. Instead of going through all these hassles and troubles that are associated to foreclosure, lenders will simply approve of a short sale right away. Short sales are easier to complete and is less expensive to service as well.

Imminent Default Requirements • A homeowner is current on his or her mortgage payments • A homeowner is delinquent for less than 30 days on his or her mortgage loan. • Proof of burden- documentations that can show expected financial hardships in the near future. • Hardship letter • Financial worksheets • Disclosure of assets • Statement of account that can verify current and possible financial challenges • Income tax return

West Palm Beach Short Sale RealtorThe biggest advantage of short selling a property despite being current on mortgage payments is the fact that these sellers will only have to wait for a shorter period of time before they can apply for a home loan in the future. In addition, the FICO score only drops a couple of notches, making it relatively easy for homeowners to get right back on track after a year or so. Depending on how an individual handles his or her finances, re-establishment of credit can be accomplished a year after closing.

There are also a few drawbacks for homeowners who opt to do short sales despite their stellar payment history. For cases wherein financial hardship is not the primary reason for applying for a short sale, borrowers are typically asked to contribute cash to the lender at closing. The lender will request a promissory note to be signed upon short sale approval. Finally, lenders will have due rights to collect for deficiency judgment after closing of a short sale. It is due to these factors that borrowers with good payment history should evaluate if the benefits outweigh the drawbacks when requesting for a short sale on their respective homes.

Whether you are the homeowner who has maintained a clean mortgage record with your lender or you are the homeowner who has found themselves in a hardship, contact one of our highly experienced San Jose CA short sale specialists and let us help you escape debt and move into the right direction of your future!

Rodney Forbes is a Realtor® and registered broker with Forbes Realty of South Florida, based in West Palm Beach Florida. Rodney and his team work in Palm Beach, Broward, Martin and St. Lucie Counties. As a recognized expert on short sales, Rodney has been featured on radio and national web conferences for agents. Rodney has also authored the book “Should I Short Sale My Home?”

Forbes Realty of South Florida also specializes in REO asset disposition. Rodney works with several banks and asset managers in the Palm Beach County area. Rodney is the main author for the popular real estate blog South Florida Real Estate Report. You can find a wealth of information regarding bank foreclosures, short sales, real estate news and local real estate trends.

For more information, please call Rodney at 561-337-4810 or email Rodney@ForbesRealtyOnline.com

 

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CITY Short Sale RealtorThe real estate market recently witnessed a major plunge, as a consequence of the recession. This mixed with the recent economic downturn that cost millions of Americans their jobs and was responsible for the rise of real estate foreclosure property listings. Consequently, various people would rather rent a home than be concerned with mortgage payments month in and month out. But as real estate brokers and agents seem to enjoy making profits from various foreclosure deals, short sales are obviously on the rise because it is a better option rather than facing foreclosure. But how do you short sale and what are the ups and downs as compared to foreclosure?

Short-sale defined

The short sale of a home is when a property is sold for an inferior amount than what it was originally worth or owed on the mortgage. There are several ways that a homeowner can get out from under of a home, but a short sale may be the best resolution in dire circumstances. Being foreclosed on will absolutely leave a negative impact on your credit record. Below is a list of just some of the fallouts you can encounter after a foreclosure:

• Getting your property foreclosed means turning it over completely to the bank;
• You are provided a limited amount of time to vacate your home, particularly if you have been negligent on the time line;
• A foreclosed record can remain in a person’s credit report for 7 up to 10 years.
• A foreclosed property record can typically affect the homeowner’s loan options, and lastly;
• A foreclosed property record might be investigated by a prospective employer and can usually affect a homeowner’s chances of landing a job

Though a short sale is generally preferred over foreclosure, it is important to note that proper knowledge is required in order for a short-sale to be achievable. Additionally, the short sale of a home impacts an individual’s credit score, though not as much and as negatively as a foreclosure could. While that may be the case, it is also important to be knowledgeable of what the aftermath of a short sale has on a homeowner’s credit score also.

Credit scores

So what are credit scores and why should it matter to homeowners considering short sale? Essentially, there are three major credit organizations that gather information when it comes to credit borrowing, spending and payment: (1) Equifax, (2) Experian and (3) TransUnion. The gathered information is then compiled into a person’s credit report and with the use of a formula provided by Fair Isaac Corporation (FICO), an individual’s credit score rating is determined. Generally, credit scores are significant due to the fact that they affect how banks, lending institutions and other big organizations communicate with an individual: the higher the individual’s credit rating, the easier it is for loans to be approved; a low credit score rating on the other hand leaves a negative mark on the record of the individual because of disregard or irresponsibility when it comes to making payments.

Short-sale effects and why it is generally better for your credit score

The main thing to bear in mind on the onset is that credit implications are very dissimilar for those homeowners who decide to sell their homes, despite the fact that it will be sold at less than what’s owed on a short-sale as compared to those forced into surrendering their property due to delinquencies of payment on mortgages as in foreclosures. But no matter what the cause, a short sale can still affect a homeowner’s credit score. Below are just some of the examples and important points to consider:

• The term “short-sale” never shows on credit reports – unlike the term “foreclosed property” or “foreclosed property owner”, the term “short-sale” never shows up on credit reports and records. While there will still be some record of the short-sale reflecting on your credit record, it will most likely show up as a loss or a negative rating. It is important to note that any form of negative credit rating, no matter the cause, is still considered bad, so while a short-sale may not appear as expected, it may still leave an impact on your record.

• Short sales can be settled – unlike foreclosure records which instantly cuts off homeowner to any right to his or her property, a homeowner engaging in short-sale may still settle the owed amount to the lender. In the case of settlement, the record in the credit reports is updated to show “settled”, which will have a more positive impact on your records.

• You do not have to be delinquent to qualify for a short-sale – Prior, lenders only consider allowing homeowners to short-sale their properties if they have been delinquent in their payments, but until lately this is no longer the case. So, a homeowner can short-sell their property while still positive on payments, therefore abstaining any records that might brand him as “seriously delinquent” and negatively impact their credit record.

Conclusion

CITY Short Sale RealtorFICO has stated that an average score of 85 to 160 points will be subtracted from a credit score for a homeowner who has a foreclosed property or has engaged in short-sale of their property. While the credit loss is the same, it is important to note that your credit score can recover even after a short sale with by making “on time” payments on all of your other bills in the future. Rebuilding a positive credit score after a short-sale can be very challenging, but it is indeed a better option than waiting for 7 years for your foreclosure record to be cleared from your credit report, just so you are able to get a loan or buy a new house.

Before opting to let your bank or lender foreclosure on your home, do your research on a short sale versus a foreclosure because once you have finished that, you are probably going to want to investigate the short sale option. The process may be a bit severe but will be a much better option for your credit in the long run. Now that you are accustomed with the perks of a short sale, I encourage you to contact one of our highly experienced Short Sale Specialists right away, our services are 100% FREE! Time is of the essence !

Rodney Forbes is a Realtor® and registered broker with Forbes Realty of South Florida, based in West Palm Beach Florida. Rodney and his team work in Palm Beach, Broward, Martin and St. Lucie Counties. As a recognized expert on short sales, Rodney has been featured on radio and national web conferences for agents. Rodney has also authored the book “Should I Short Sale My Home?”

Forbes Realty of South Florida also specializes in REO asset disposition. Rodney works with several banks and asset managers in the Palm Beach County area. Rodney is the main author for the popular real estate blog South Florida Real Estate Report. You can find a wealth of information regarding bank foreclosures, short sales, real estate news and local real estate trends.

For more information, please call Rodney at 561-337-4810 or email Rodney@ForbesRealtyOnline.com

 

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West Palm Beach Short Sale Realtor

For majority of short sale sellers and buyers, this information is common knowledge. However, what is not very secret in Palm Beach Gardens Florida are the details involved from the contract to the closing of the short sale. There are actually multiple stages involved in the Florida short sale process that may cause more misconceptions and confusion without the guide of competent short sale specialists. Let us examine the top five short sale myths.

MYTH 1: Getting short sale approval is typical, normal, or standard.

Homeowners believe that due to government streamlining, the set of standards allow banks to follow a specific process for short sale initiatives. The typical process, in Palm Beach Gardens Fl, understood by buyers and sellers is that offers are submitted, signed, and handed over to the listing agent who turns all documentation to the bank. After a few months, or in rare occasions a few weeks, approval is received.

FACT: There is nothing typical, normal, or standard when it comes to a short sale.

A bank is generally in a authority position and may respond to offers of the homeowner in the manner they want. There is an apparent possibility that they may counter with a higher offer or demand some form of cash payment from sellers. It is also possible that none of these will come to pass. An asking price in Palm Beach Gardens, that is way below the standard, can be approved unexpectedly or insist on an above board pricing. This means there is no standard with short sale initiatives. This also highlights the need to have the services of short sales specialists.

MYTH 2: The broker and offer of the buyer affects the approval of the short sale.

Homeowners believe that since banks and investors are more worried with profits more than anything else, having a buyer in Palm Beach Gardens with a broker that is knowledgeable in short sale and provides a more than adequate pricing offer, the short sale initiative will be immediately approved.

FACT: Despite the truth that banks and investors look at profits, much value is given to writing a clean and well-qualified offer.

West Palm Beach Short Sale RealtorThis is important in making sure that the seller and the buyer hang onto the initiative until the contract is signed. It is important to note that the offer and the agent of the buyer in Palm Beach Gardens have very little to do with how the bank will approve the initiative from the bank based on their needs to close the short sale. This is the reason why this is classified as one of the five short sale myths.

Even though there is no denying that offer pricing in Palm Beach Gardens has significant weight, it is not that important when it comes to short sale initiatives where the following factors have substantial bearing:

• Fair market value of the property based on third-party broker’s opinion in Palm Beach Gardens or automated computer model.
• Financial condition of the seller or potential future challenges.
• Completion of the workout short sale package of the seller along with the constant follow-up done by the local real estate agent to close the transaction.
MYTH 3: Banks have limitations on what they can do.

Majority of homeowners without the benefit of Florida short sale specialists in Palm Beach Gardens believe that banks are limited by government requirements and regulations in dealing with short sale initiatives. Additionally, they feel that the operating standards add to the imposition of the limitations which can be detrimental to their condition.

FACT: As one of the common five short sale myths, it contributes to the negativism and limited options of homeowners. The truth of the matter is that a short sale initiative in Palm Beach Gardens is merely a proposal to waive a debt that is legally owed by financially challenged homeowners.

This means that since the bank is the legal lender, it has the absolute right on what can be done including outright refusal of the request in Palm Beach Gardens for debt forgiveness. This means that if they have the right to refuse, then they also have the right to impose whatever conditions they want on the initiative.

Experienced Florida Short Sale Realtors know that it is entirely possible for the bank to demand more money from the seller or even the buyer. In the same manner that they can ask real estate agents to lower their commissions and even refuse payment of closing costs. The buyer and the seller in Palm Beach Gardens may also refuse or accept any or all of the demands of the bank, but, it is important to remember that the bank has absolute control of the rules of the game.

MYTH 4: Homeowners will benefit more by walking away in Palm Beach Gardens instead of short sell initiatives.

Normally, homeowners get the advice from inexperienced real estate agents or incompetent real estate companies to simply walk away instead of going through the tedious process of a short sale initiative in Palm Beach Gardens. Supposedly, this will give them more benefits not only financially, but also in terms of credit scores.

FACT: For majority of homeowners who are faced with upside down properties in Palm Beach Gardens, walking away and allowing foreclosure proceedings is tantamount to an extremely serious decision.

West Palm Beach Short Sale RealtorThe foundation of the decision can dramatically vary depending on the owner and the state where the property is located. In some states homeowners can be sued by lenders when the mortgage comes into default. State taxes may also be imposed on the debt that has been cancelled due to foreclosure, which can reach tens of thousands of dollars.

The key to dealing with one of the five short sale myths is to have the backing of real estate companies such as the Short Sale Specialist Network which can help homeowners get in touch with experienced local real estate agents. This will help financially challenged homeowners to be less impaired by short sale initiatives compared to foreclosure. This kind of support will also help distraught homeowners in Palm Beach Gardens to recover their credit rating faster including the functionality of getting another mortgage in a shorter time. A short sale also costs the seller almost nothing aside from the investment in time and effort, which makes it the smarter choice than simply walking away.

MYTH 5: A Florida Short sale is synonymous to pre-foreclosure.

With the varying standards implemented by banks, especially with some enforcing time limits for the short sale prior to initiating a full foreclosure in Palm Beach Gardens, many homeowners believe that a short sale initiative is similar to going through a pre-foreclosure proceeding.

FACT: Basically, in a short sale, homes are being sold for lesser their value in order to settle outstanding obligations to the lender.

This is one of the five short sale myths that need further clarification. Pre-foreclosure on the other hand involves homes that are being prepared for foreclosure due to mortgage payment delays. The Fact is that some short sale initiatives in Palm Beach Gardens are pre-foreclosures simply because homeowners decide on stopping mortgage payments once the property is placed on the market. Typically this happens because the homeowner no longer can afford to make payments, doesn’t see any significance in pursuing the payments, or because they have the wrong notion that the bank will approve the short sale more rapidly once the loan comes into default. This kind of decision making process highlights the need for the services of Short Sale Specialist Network which can help homeowners make educated decisions.

West Palm Beach Short Sale RealtorThe five short sale myths constitute the basic foundation of how homeowners react to various short sale conditions as well as why they opt to walk away or foreclose. By understanding the five short sale myths and getting the services of short sale specialists, homeowners will be able to maximize the benefits of their current condition in Palm Beach Gardens Florida! When it comes to your financial future and choosing someone to assist you in the short sale process, experience is everything. Demand the best. Contact us to be connected to a local short sale Realtor to offer no cost short sale services and guidance through the process.

Rodney Forbes is a Realtor® and registered broker with Forbes Realty of South Florida, based in West Palm Beach Florida. Rodney and his team work in Palm Beach, Broward, Martin and St. Lucie Counties. As a recognized expert on short sales, Rodney has been featured on radio and national web conferences for agents. Rodney has also authored the book “Should I Short Sale My Home?”

Forbes Realty of South Florida also specializes in REO asset disposition. Rodney works with several banks and asset managers in the Palm Beach County area. Rodney is the main author for the popular real estate blog South Florida Real Estate Report. You can find a wealth of information regarding bank foreclosures, short sales, real estate news and local real estate trends.

For more information, please call Rodney at 561-337-4810 or email Rodney@ForbesRealtyOnline.com

 

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Short Sale Versus Loan Modification in Jupiter Florida

by Rodney Forbes on September 29, 2012

West Palm Beach Short Sale RealtorThere is no doubt that many distressed homeowners are contemplating on the options of short sale vs. loan modification. For some, the big issue is that they are unaware if their property will qualify for a short sale or mortgage modification in Jupiter Florida. The main issue is that some homeowners fail to get the services of Florida short sale specialists who can provide them with proper information to make an educated decision. No doubt that the choice of short sale vs. loan modification can have different consequences depending on how you want to handle your current financial condition. However, it is important to note that there are some distinct advantages presented by short sale as compared to loan modification in various financial aspects. Let us examine the multiple effects of both transactions on your financial condition.

1. Difference of the transactions.

One of the best ways to distinguish which is best for your condition, it is important to see the difference between them. In general, the short sale transaction occurs when the homeowner owes more than what the property is worth in the current real estate market. This type of transaction requires the assistance of a local real estate agent or short sale specialist to negotiate with the lender and cautiously assess offers from legitimate buyers. It also permits the homeowner to settle financial obligations for relatively less of what they owe. Mortgage modification in Jupiter FL on the other hand is similar to refinancing, but it is not considered as a new loan. Essentially, what the homeowner is asking is that the lender modify the terms of the existing mortgage by altering the interest rate to something inferior, reducing monthly payments, or extending the payment terms among others. Unlike refinancing, loan modification will not be based on current credit score. Compared to short sale, the amount owed will not be paid off with the property.

2. Credit report implications.

There is no question that both short sale and loan modification transactions will have substantial impact on the credit report of the borrower. The short sale transaction in Jupiter will particularly indicate that the financial obligation has been paid in full based on the agreement with the lender but not based on the original terms. Loan modification on the other hand will explicitly state that the loan has been modified based on the request of the buyer and not as originally agreed upon. Moreover, the short sale will be reflected as a settlement of all major delinquencies. In some cases this is more favorable for the homeowner depending on his current needs and financial situation. Based on credit report implications of short sale vs. loan modification, short sale transactions would appear to be more favorable.

3. Documentation requirements.

West Palm Beach Short Sale RealtorIt should be comprehended that both short sale and loan modification transactions are reasonable ways to avoid foreclosure. The main dissimilarity in Jupiter is that the short sale will grant you the ability to walk away from your home and basically owe nothing to the lender. With loan modification, you keep your home, but have to contend with monthly fees and interest rates. In terms of approval time, both can take substantial time to get approved or rejected, which can be considerably frustrating. With regards to documentation requirements of short sale vs. loan modification, they basically have the same. The borrower has to produce a hardship letter to give account for the reason for the transaction request. The last two paycheck stubs will be mandatory for income verification along with the previous two years of tax returns. The 1099 or W2 forms will also be required by the lender as well as the financial statement of the borrower. The main difference is that the short sale transaction will receive a documentation of an offer to purchase from interested parties.

4. Saving your home.

Many homeowners forget that saving your home does not necessarily mean keeping it for yourself. It can also mean abstaining from foreclosure and having the bank removing it from them leaving them with nothing but more debt. A short sale transaction therefore should be initiated before foreclosure proceedings are started. It should be requested from the current lender or a new qualified FHA lender. Typically 120 days or less is needed for the completion of the process. With loan modification, it is extremely critical to note that there will be no reduction on the principal amount owed. This means that your debt can substantially increase despite keeping your home in Jupiter. The amortization is likewise usually redone along with a lower interest rate in most cases. Depending on the negotiations, the interest rate can be fixed for a particular period. Since loan modifications are ideal when borrowers are behind payments, they are viewed mostly as temporary solutions to update on payments. However, the current and immediate financial future of the borrower should be closely examined.

5. Make a decision.

West Palm Beach Short Sale RealtorFor homeowners, it is critical to apprehend that they have to decide on short sale vs. loan modification. This is because banks normally do not open two files simultaneously. Meaning that they have to either file for a short sale transaction or a loan modification. Only one of these options in Jupiter can be seriously pursued and should be supported by a competent local real estate agent or company. In making the decision, the homeowner has to choose on settling the outstanding debt or attempting to get updated on payments. Since for majority of homeowners the root problem is that they no longer have the financial capacity to continue with monthly payments regardless of how low the interest rate, short sales become the best option for them. In this case, the services of short sale specialists with solid a background on closings should be sought out.

Without question, many homeowners would opt for a new start than gamble on the possibility of waiting for their financial condition to improve. Getting out from underwater can be challenging if not immediately addressed. When it comes to short sale vs. loan modification in Jupiter Florida, if the value of the property is significantly lower than what is owed, then short sale might be the best option. Contact a short sale specialist and acquire more information about a short sale versus a loan modification and which option best fits your hardship!

Rodney Forbes is a Realtor® and registered broker with Forbes Realty of South Florida, based in West Palm Beach Florida. Rodney and his team work in Palm Beach, Broward, Martin and St. Lucie Counties. As a recognized expert on short sales, Rodney has been featured on radio and national web conferences for agents. Rodney has also authored the book “Should I Short Sale My Home?”

Forbes Realty of South Florida also specializes in REO asset disposition. Rodney works with several banks and asset managers in the Palm Beach County area. Rodney is the main author for the popular real estate blog South Florida Real Estate Report. You can find a wealth of information regarding bank foreclosures, short sales, real estate news and local real estate trends.

For more information, please call Rodney at 561-337-4810 or email Rodney@ForbesRealtyOnline.com

 

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Chase Short Sale Procedure in Palm Beach Gardens Florida

by Rodney Forbes on September 28, 2012

West Palm Beach Short Sale RealtorChase is one of the largest multinational banking corporations, and supply plenty of services to match their reputation: banking, investments, and now, short sales. Since branches of the company can be found in Palm Beach Gardens Florida, as well as across Florida, a homeowner can easily avail of a short sale from Chase, along with a variety of other financial and mortgage assistance services. You and your family can have a shot at a normal financial life again.

In fact, you may also be found worthy for generous cash incentives in Palm Beach Gardens, FL when getting a short sale with Chase. A fortunate San Diego family received $ 30,000 as a cash incentive after a Chase Short sale that closed in November 2011. This can be a good sign for many homeowners who are having a difficult time paying off mortgage loans; the cash incentive can be a great way to pay off remaining debts, or to start anew by relocating to a new home.

Applying for a Chase Short Sale

People who would like to apply for a short sale with Chase can simply do so, on their official website. On the appropriate page, two information packets for Palm Beach Gardens are listed: A full packet, which is intended for first-time short sellers who have not yet requested for a loan modification and a supplemental package for previous and pending applicants.

West Palm Beach Short Sale RealtorBoth packets are required to be printed out, filled out and signed by the appropriate parties in Palm Beach Gardens. Supporting documents also have to accompany these forms, and can be organized with the included checklist. The packet should then be submitted to the Chase offices through mail. Chase also proposes free FedEx shipping for short sale application packets.

The documents required from applicants in Palm Beach Gardens are as followed:
1. Borrowers and Co-borrowers
.Length of service with current employers
.A full and most current month’s bank statement
.Two most recent pay stubs per borrower
.Wage Earners who are employed

• Self-employed borrowers
o Audited or reviewed YTD income statement/ P&L statement
o Last two years’ 1099 forms
o All pages of recent personal bank statements from the last four months in Palm Beach Gardens.
o All Borrowers
.Purchase/sales contract
.Evidence for occupancy
.Complete, recent and signed tax return forms
.Listing agreements
.Detailed listing history
.HUD, or the Estimated Closing Statement
.3 comparable real estate listings/sales, complete with pictures of the property and surrounding neighborhood
2. Real Estate Agents

West Palm Beach Short Sale RealtorAlso included in the series of Chase Short Sale application forms in Palm Beach Gardens Florida is a hardship affidavit. In this section, a selection of hardships may be ticked in the appropriate check boxes based on the borrower’s hardship. A separate hardship letter can be written on the back of the form if necessary.

Chase Short Sale Cash Incentives

One of the most widely publicized cases of a Chase short sale occurred in November of 2011, when a representative of Battiata Real Estate Group helped a family close out a short sale deal, along with a generous $ 30,000 cash incentive. The home itself closed out at a sales price of $ 420,000. Some of the cash incentive also remained payable to real estate brokers, too.

Similar to many other real estate companies and financial institutions that boast about cash incentives, you will have to read the fine print in order to receive any at all. Some banks only hand out cash incentives in certain circumstances, like closing out a short sale in a set period of time in Palm Beach Gardens, in order for a homeowner to be eligible. These criteria can vary depending on the situation, even within Chase guidelines.

Chase advertises cash incentives of up to $ 35,000 for homeowners wanting a short sale. A cash incentive is a common way for banks to lure in customers in Palm Beach Gardens Florida who are on the brink of foreclosure, and Chase is no different. The amount you receive as an incentive may vary, and not be enough to pay back lenders in many cases, but a shot at a cash bonus is always something good for a financially unstable homeowner to gun for.

Chase bank will also pay cash incentives for older Washington Mutual loans in Palm Beach Gardens, due to Chase’s buyout of the company in 2008. Washington Mutual points can even be redeemed with a Chase bank online account for cash rebates, rewards, and other benefits.

Be knowledgeable that homeowners will not receive cash incentives from the proceeds of the actual short sale, and that the exact amount of cash incentives will be decided by Chase and your other lenders in Palm Beach Gardens. Make sure that you call up the Chase offices, or your debt holders and other banks if you would like to discuss the terms involved with a cash incentive.

About JP Morgan Chase & Co.

JP Morgan Chase & Company is a multinational banking corporation that deals with all sorts of finances in Palm Beach Gardens Florida. In terms market capitalization and assets, JP Morgan Chase & Co. is the largest bank in the United States, and ranks as Forbes Magazine’s #1 largest public company in the world. It is also known as a part of the Big Four banks, next to Wells Fargo, Bank of America and Citigroup.

West Palm Beach Short Sale RealtorThe company came as a result of a merger between JP Morgan & Co. and Chase Manhattan Corporation. The JP Morgan division manages investment and private banking, as well as asset management and securities services in Palm Beach Gardens. The Chase side of things continues to handle retail banking activities across the United States, including loans, mortgages, and short sales. With short sales, come Palm Beach Gardens short sale specialists who have far reaching training and experience in the short sale process. Contact an experienced short sale Realtor today and see if you qualify for a short sale!

Rodney Forbes is a Realtor® and registered broker with Forbes Realty of South Florida, based in West Palm Beach Florida. Rodney and his team work in Palm Beach, Broward, Martin and St. Lucie Counties. As a recognized expert on short sales, Rodney has been featured on radio and national web conferences for agents. Rodney has also authored the book “Should I Short Sale My Home?”

Forbes Realty of South Florida also specializes in REO asset disposition. Rodney works with several banks and asset managers in the Palm Beach County area. Rodney is the main author for the popular real estate blog South Florida Real Estate Report. You can find a wealth of information regarding bank foreclosures, short sales, real estate news and local real estate trends.

For more information, please call Rodney at 561-337-4810 or email Rodney@ForbesRealtyOnline.com

 

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Alternatives to Foreclosure in Jupiter Florida

by Rodney Forbes on September 28, 2012

West Palm Beach Short Sale RealtorFor homeowners that are in a financial hardship, any substitute for foreclosure is welcome, essentially. However, choosing the suited foreclosure alternative can be challenging. A large number of factors can be influential to a homeowner’s decision in Jupiter Florida: their short term financial circumstance, their long term income prospects, their assets, interest rates, the internal policies of their lender, the present as well as future market value of their property, even ethical and moral values may come into practice.

To make matters complicated, a great deal of the advice on foreclosure alternatives comes from self-interested parties with a “dog in the race”, so to speak. These could be lenders who benefit from loan modification, 3rd parties that make homeowners pay fees for assistance through strategic default, and individuals naming themselves as experts in short sales or foreclosure avoidance, who in reality may have minimal experience or training on the subject matter.

With so many different aspects to acknowledge and so much conflicting information out there, and such a critical choice to be made, how can a homeowner abstain from a foreclosure and pick the best foreclosure alternative for their situation? Beneath here, we examine the pros and cons of a few of the major alternatives to foreclosure.

How to Avoid Foreclosure – Alternatives to Foreclosure

Short Sale

When dealing with a foreclosure, a short sale is great because the homeowner receives approval from the lender to sell the home for less than the value of their debt. In some states, non-recourse laws prevent the lender from legally pursuing a judgment against the borrower for the debt remaining after the secured property is purchased, meaning the homeowner is excused. In those states without non-recourse laws, the homeowner may classify a short sale with the aid of a short sale specialist and negotiate a written agreement from their lending institution, abdicating their right to sue for the deficiency (the remaining debt owed by the homeowner after the home is sold). In return, the lender receives the proceeds of sale of the home without the legal and administrative costs affiliated with the foreclosure process.

West Palm Beach Short Sale RealtorThe drawback to a short sale is that if you are in a recourse state and you still have significant assets, you will most likely still be personally responsible for the deficiency when the home sells for less than the value of the outstanding debt. In addition, there are few Realtors with the experience mandatory to maintain the complexities of a short sale. The homeowner must be very persevering in screening Realtors in order to emerge from a short sale with a positive conclusion. However, with an experienced short sale specialist, a short sale may grant the homeowner the ability to salvage their credit, have their debt relieved, and also avoid the public humiliation and spectacle of a foreclosure.

Loan Modifications

Loan modifications are often acclaimed as a technique to refraining from foreclosure. Homeowners dealing with potential foreclosure are often recommended to contact their lenders and work out a loan modification, where the lender alters the terms of the mortgage in order to help the homeowner remain in their home. As for the lender, it can be reasonable to accept smaller payments over a longer amortization period, temporarily freezing interest rates, or delayed payment rather than accept the losses they would face with a foreclosure, particularly where the property value of the home has severely declined.

While loan modification programs may be favorable for the lender, for most aggrieved homeowners, loan modifications are a short solution that profits the lender as opposed to the homeowner. If the property value of the borrower’s home has lowered to a point where it is significantly inferior to the value of the mortgage, the homeowner will still be making Realtor mortgage payments for a home worth significantly less than what they are paying, all the while incurring further debt. If the homeowner in Jupiter, FL is dealing with unemployment or a significantly reduced income, then it is not likely that they will have the ability to continue to make mortgage payments in the long run. Thus, a loan modification may only prolong the inevitable.

On the other hand, loan modifications may be appropriate in other circumstances where the reason being for the homeowner’s financial distress is a short term one, as opposed to the long term financial problems that come with sharply declining property values and significantly reduced income.

Deed In Lieu Of Foreclosure

West Palm Beach Short Sale RealtorThere is one more foreclosure alternative to bear in mind, the deed in lieu of foreclosure. A deed in lieu of foreclosure is alike in concept to a short sale, except on behalf of selling the home, you hand back the home to the lender and in exchange, the lender will terminate foreclosure proceedings or agree not to decree foreclosure proceedings. Like with a short sale, it is critical to negotiate a forgiveness of the deficiency if you are in a recourse state, or you could still be held responsible for the deficiency after the bank receives the deed.

The downside to a deed in lieu of foreclosure is that it can be rather difference to get the lender to admit a deed in lieu. It is significantly easier to get a lender to agree to a short sale. As a matter of fact, many lenders will ask that you put your home on the market for a certain time frame before they will take into consideration a deed in lieu of foreclosure. With a short sale, you come to the lender with an offer and a buyer ready to pay, while with a deed in lieu of foreclosure you’re making a request for the lender to accept the deed to the property.

Which Foreclosure Alternative Is Right For You?

Even armed with information regarding ways you can block foreclosure and choose a preferable alternative to foreclosure, it can be confusing to know which option suites you best for your particular case.

Generally speaking, a loan modification is the best answer when the cause of the missed mortgage payments or financial difficulty is simply a short term cash flow problem. Perhaps this could be medical emergency, sudden major repairs to the property, a car accident, or another long term financial crisis. Unfortunately in Jupiter for most homeowners, the reason for their distress isn’t a short term cash flow problem. If the root of the issue is because of a significantly reduced income or a sudden decline in property values, then a loan modification will generally be inadequate as a long term solution. In fact, it may cost the homeowner more in the long run, as they struggle to keep up with loan payments, only to inevitably end up back where they started seeking other options to foreclosure.

West Palm Beach Short Sale RealtorThe deed in lieu of foreclosure offers a number of benefits over loan modification. It allows the homeowner to potentially get a fresh start while avoiding many of the psychological and financial consequences of a foreclosure. However, it can be difficult to obtain a deed in lieu as lenders generally would prefer cash over the deed. This leaves the short sale as the best substitute to foreclosure where the cause of the homeowner’s financial distress is because of unemployment, significantly reduced income, or where the value of the property in Jupiter has dropped significantly. As previously mentioned, if your choice is to take advantage of a short sale as an alternative to foreclosure, it is extremely important to find an experienced short sale Realtor who can manage the complexities of a short sale transaction. But with the proper representation, a short sale could be the alternative to foreclosure you’re looking for.

**Rodney Forbes is a Realtor® and registered broker with Forbes Realty of South Florida, based in West Palm Beach Florida. Rodney and his team work in Palm Beach, Broward, Martin and St. Lucie Counties. As a recognized expert on short sales, Rodney has been featured on radio and national web conferences for agents. Rodney has also authored the book “Should I Short Sale My Home?”

Forbes Realty of South Florida also specializes in REO asset disposition. Rodney works with several banks and asset managers in the Palm Beach County area. Rodney is the main author for the popular real estate blog South Florida Real Estate Report. You can find a wealth of information regarding bank foreclosures, short sales, real estate news and local real estate trends.

For more information, please call Rodney at 561-337-4810 or email Rodney@ForbesRealtyOnline.com

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Short Sale Myths in Palm Beach Gardens

by Rodney Forbes on September 27, 2012

West Palm Beach Short Sale RealtorBecause of homeowners wanting to conduct short sale initiatives on their own, they usually come across the top five short sale myths. In result, it has led to prevalent confusion and widespread misconceptions in Palm Beach Gardens Florida, not only on its details, but the process involved as well. The truth is that short sales are one of the longest real estate transactions, which may easily eat up several weeks to several months on average from the time of contract to closing. At heart, the only thing that is short with this process is the price expected in relation to the outstanding debt of the homeowner to the bank. Don’t let the name fool you!

For most short sale sellers and buyers, this information is common knowledge. However, what they are not very reserved about are the details involved from the contract to the closing of the short sale. There are actually various stages involved in the short sale process that may bring about more misconceptions in and confusion if the guidance of a competent short sale agent is missing. Let’s take a look at the top five short sale myths.

MYTH 1: Getting a short sale approval is typical, normal, or standard.

Homeowners think that because of government streamlining, the set of standards grant banks the ability to follow a specific process for short sale initiatives. What is understood by buyers and sellers in this process is that offers are submitted, signed and turned over to the listing agent who manages all documentation to the bank. After a few months, or in rare occasions a few weeks, approval is received.

FACT: There is nothing usual, normal, or standard when it comes to a short sale.

A bank is typically in an authoritative position and may respond to offers of the homeowner in the manner they desire. There is an apparent possibility that they might counter with a higher offer or demand some form of cash payment from sellers. It is possible as well that none of these will happen. An asking price in Palm Beach Gardens FL that is way lower than the standard may be approved unexpectedly or insist an above board pricing. This means that there is no standard with short sale initiatives. This also highlights the need to have the services of short sale specialists.

MYTH 2: Homeowners will profit more by walking away rather than short sell initiatives.

Generally, homeowners receive the advice from inexperienced real estate companies or incompetent real estate companies to simply turn away rather than bearing through the tedious process of a short sale initiative. Apparently, this will provide them more advantages not only financially, but also in terms of credit scores.

FACT: For most homeowners who are facing upside down properties, walking away and allowing foreclosure proceedings is tantamount to an extremely serious decision.

The foundation of the decision can dramatically alter depending on the owner and the state where the home is located. In some states homeowners may be sued by lenders when the mortgage comes into default. State taxes may also be imposed on the debt that has been cancelled because of foreclosure, which could potentially be tens of thousands of dollars.

The key to handling one of the five short sale myths is to have the backing of real estate companies which can help homeowners get in touch with experienced local real estate agents. This will help financially challenged homeowners to be less hindered by short sale initiatives as opposed to foreclosure. This kind of support will also help aggrieved homeowners repair their credit faster including the functionality in Palm Beach Gardens of getting another mortgage in a shorter time. A short sale also costs the seller nearly nothing besides the investment in time and effort, which makes it the wiser decision as opposed to simply just turning away.

MYTH 3: Banks have limitations on what they are capable of doing

The majority of homeowners who are missing the benefits of having short sale specialists believe that banks are restricted by government requirements and regulations in dealing with short sale initiatives. In addition, they feel that the operating standards add to the imposition of the limitations which can be detrimental to their condition.

FACT: As one of the common five short sale myths, it contributes to the negativism and limited options of homeowners. The truth of the matter is that a short sale initiative is slightly a proposal to waive a debt that is legally owed by financially challenged homeowners.

West Palm Beach Short Sale RealtorThis means that since the bank is the legal lender, it has the absolute right on what can be done including outright refusal of the request for debt forgiveness. This also means that if they have the right to refuse, then they also maintain the right to impose whatever conditions they went on the initiative.

Experienced short sale specialists know that it is entirely possible for the bank to demand more money from the seller or even so the buyer. In the same aspect, they can ask real estate agents to lower their commissions and even refuse payments on closing cost. The buyer and the seller in Palm Beach Gardens may also decline or accept any or all of the demands of the bank, but, it is important to remember that the bank has absolute power over the rules of the game.

MYTH 4: The broker and offer of the buyer affects the approval of the short sale.

Homeowners think that since banks and investors are more worried about profits more the anything else, having a buyer with a broker that has a background in short sales and provides a more than adequate pricing offer, the short sale initiative will at once be approved.

FACT: Despite of the truth that banks and investors look at profits, much value is given to writing a clean and well-qualified offer.

This is critical while making sure that the seller and the buyer hang onto the initiative until the contract is signed. It is valuable to note that the offer and the agent of the buyer have very little to do with how the bank will approve the initiative from the bank based on their needs to close the short sale. This is the reason why this is classified as one of the five short sale myths.

Even though there is no denying that the pricing offer has significant weight, it isn’t that important when coming to short sale initiatives where the following factors have substantial bearing:

.Fair market value of the property based on third-party broker’s opinion or automated computer model

.Financial condition of the seller or potential future challenges

Completion of the workout short sale package of the seller along with the constant follow-up is done by the local real estate agent to close the transaction.
MYTH 5: Short Sales are similar to pre-foreclosure

With the varying standards implemented by banks, especially with enforcing time limits for the short sale before initiating a full foreclosure, many homeowners believe that a short sale initiative is similar to going through a pre-foreclosure proceeding.

FACT: Basically, in a short sale, homes are being sold for lesser than their value in order to settle outstanding obligations to their lender.

This is one of the five short sale myths that need further clarification. Pre-foreclosure on the other hand involves homes that are being prepared for foreclosure because of mortgage payment delays. The fact is that some short sale initiatives are pre-foreclosures simply due to homeowners deciding to stop mortgage payments once the property is placed on the market. This typically happens in Palm Beach Gardens because they have the wrong notion that the bank will approve the short sale faster once the loan comes into default. This type of decision making process highlights the need for the service of a short sale specialist who can help homeowners make educated decisions.

West Palm Beach Short Sale RealtorThe five short sale myths constitute the basic foundation of how homeowners react to various short sale conditions as well as why they choose to walk away or foreclosure. By understanding the five short sale myths and getting the services of short sale specialist, homeowners in Palm Beach Gardens will be able to maximize the advantages of their current condition. When coming to your financial future and deciding on someone to assist you in the short sale process, experience is everything. Don’t settle for less.

**Rodney Forbes is a Realtor® and registered broker with Forbes Realty of South Florida, based in West Palm Beach Florida. Rodney and his team work in Palm Beach, Broward, Martin and St. Lucie Counties. As a recognized expert on short sales, Rodney has been featured on radio and national web conferences for agents. Rodney has also authored the book “Should I Short Sale My Home?”

Forbes Realty of South Florida also specializes in REO asset disposition. Rodney works with several banks and asset managers in the Palm Beach County area. Rodney is the main author for the popular real estate blog South Florida Real Estate Report. You can find a wealth of information regarding bank foreclosures, short sales, real estate news and local real estate trends.

For more information, please call Rodney at 561-337-4810 or email Rodney@ForbesRealtyOnline.com

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