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Tipping the Scales Toward Foreclosure? January 31, 2012

Posted by bobgauger in Distressed Homes, Foreclosures, Resources, Short Sales.
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Millions of homeowners in this country are unable to afford the payments on a home that’s worth less than the amount they owe on their mortgage.

These are people who have played by the rules, made good decisions, and had every reason to believe that the American Dream of homeownership was in their hands. Unemployment, underemployment and real estate market upheaval has derailed a lot of those dreams. Since 2007, 8.9 million homes have been lost to foreclosure.

My mission is to keep you and anyone you care about from adding to that statistic. The fact is, there are options to foreclosure-better options now than ever before.

As a Certified Distressed Property Expert (CDPE), I have the training and expertise to help financially distressed homeowners to make a positive fresh start. If you or anyone you care about is faced with an unmanageable mortgage, I can help.

I invite you to visit my website www.HomeLoanRx.com for a copy of my recent report entitled, “Tipping the Scales Toward Foreclosure?” Contact me today and let’s get started on a positive start to 2012!

Bob Gauger, REALTOR NRBA, CDPE, CDRS
EXiT Landmark Realty
4550 Crain Hwy
White Plains, MD 20695
301-934-2022 ext 118
240-286-4447 cell
www.HomeLoanRx.com

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Solutions for Your Mortgage Crisis – Distressed Homeowners Series, Post 1 of 5 November 30, 2011

Posted by bobgauger in Distressed Homes, Foreclosures, General, Resources, Short Sales.
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In the next few weeks, I’ll be dedicating posts to the subject of distressed homeowners, options, short sales, common mistakes, deficiency judgments and more.

Distressed Homeowners Series,
Post 1 of 5

Solutions for Your Mortgage Crisis

Distressed HomeownerAre you in financial distress because of your mortgage? Do you need to get out from under a payment that has become too hard to manage – but can´t sell your house because it is no longer worth enough to cover the mortgage balance? 

If so, you are certainly not alone. Hundreds of thousands of other Americans are in that leaky boat with you, and there´s no easy way out. But you do have choices, and you should take a look at all of them before deciding what to do.

You can:

  • Hope for a loan modification
  • Ask for forbearance
  • File bankruptcy
  • Let the bank foreclose
  • Attempt a short sale.

A loan modification sounds the best, but the rules the banks are playing by are both confusing and conflicting. Some say you must not be behind on payments. Others say they won´t consider helping you unless you´re in default.

And some asset managers, sadly, are working hard not to modify loans because it´s more profitable for them to foreclose.

It certainly can´t hurt to contact your lender and see if you are eligible, but please don´t fall for any of the scams that are circulating right now. There are far too many dishonest people willing to collect anywhere from a few hundred to a few thousand dollars from you on the promise of getting your loan modified. In truth, they can´t and won´t do anything you can´t do yourself. If you want help, contact an attorney you trust.

If your problems stem from unemployment, and you have an FHA loan, you can ask for forbearance. Under a law effective August 1, 2011, banks can extend forbearance for 12 months. During that time you may be required to make minimal payments, and the unpaid payments and interest will still be due later, but the bank cannot impose late fees or fines, and cannot start foreclosure. This law may be extended to conventional loans, so do check with your lender.

Another bit of good news about forbearance is that you are allowed to offer your house for sale during this time. This, combined with a sale or a short sale, could provide the relief you need to get back on strong financial footing.   

Bankruptcy has helped some consumers. The courts now have the authority to let you keep your home and either forgive a portion of your debt or modify the terms so you can make the payments. If you´re also buried in medical bills, credit card debt, or other obligations you simply can´t meet, this might be the best solution.

But3; bankruptcy stays on your credit report for 10 years and could keep you from moving forward in life. In addition, it places some restrictions on your life that you might find very unpleasant. It might not be the best choice for you.

Foreclosure is another option. You can simply quit making the payments and stay there until they knock on the door and tell you the bank now owns your home. For some this is a chance to live rent and payment free for several months and put away some money for a deposit on a rental home. But again � the effect on your credit rating is dire.

In addition, you run the risk of a huge financial obligation that will follow you around forever. When the bank sells your house at a loss because the market has fallen, they might be able to come back on you to make up the “deficiency” between your mortgage balance and the dollars they collected from the sale of the house.

Creditors can continue trying to collect on a deficiency judgment for 20 years, so this isn´t something to take lightly. This is another area where the rules keep changing, so check this before you act.

If done correctly, a Short Sale could be the best option for you. You list and sell the house for the current fair market value and walk away with no money, but a fresh start. At least, that´s what will happen if you list the house with an agent who is experienced in handling successful short sales.

The truth is, your lender can also come back to you for a deficiency in a short sale. It´s one of those details that must be negotiated with the asset manager and the lender before you sign the closing papers.

Unfortunately, many real estate agents today are listing short sale properties without knowing how to conduct the necessary negotiations, and their sellers are paying the price for that lack of knowledge.

In other cases, listings that begin as short sales end up going into foreclosure.

Why? Again – because the agent lacked experience and knowledge.

Success in a short sale relies on 3 primary areas of expertise, and before you list with any agent you need to know that he or she is skilled in all three areas. Otherwise, you could end up in foreclosure despite your best efforts.

To learn the 3 secrets to short sale success, simply call me at (240) 286-4447, write me at info@HomeLoanRx.com or go to www.HomeLoanRx.com. (I promise, you won´t receive high-pressure messages and I won´t share your address with anyone.)

I look forward to helping you.

Best wishes,

Bob

~~~~~~~~~~~~~~~~~~~~~~~~

Bob Gauger, REALTOR
NRBA, CDRS
EXiT Landmark Realty
4550 Crain Hwy
White Plains, MD  20695
(240) 286-4447 cell
(301) 934-2022 ext 118 ofc
(888) 932-3948 fax
info@HomeLoanRx.com
www.HomeLoanRx.com  

Home Staging — Is it Really Worth the Expense? December 20, 2007

Posted by bobgauger in General, home staging, Resources, Seller Tips, Uncategorized.
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Quality home staging significantly improves a seller’s chance to affect a quick sale at the highest possible price.  This is why we have a home stager on our team. While my expertise is marketing, pricing in today’s market, contract negotiations and seeing a transaction through the settlement process, Jill Oliver, our staff Home Stager, provides the expertise in organizing and home staging. When applicable, we have Jill consult with our clients to prepare their home for the market.

Here is a recent Q&A with Jill:

  • What would you say are the top three things that sellers should do to their house before putting it up for sale?  
    De-Clutter, organize and clean, make necessary repairs, update.
  • Is it important to ‘depersonalize’ a house before showing it? Are there any exceptions? 
    Yes, it is very important to depersonalize a home before putting it on the market.  People want to envision themselves living in the house, but if there are personal pictures hanging on the walls and on every surface, they will not be able to see themselves in the home — they will just see the pictures.  If my clients are adamant about their pictures, I tell them to leave a couple, and leave them in the more private spaces of the home: upstairs, bedrooms, etc.
  • Can a house that is too personalized hurt its chances of being sold? 
    Yes.  You want to make the home as neutral as possible.  You want to market your home to as many different people as possible.  So neutralize the color scheme, the decorating and the furniture.
  • Should rooms with unique or outdated features be changed or does it depend? (those painted in bold colors, have unique wall murals, pink shaggy carpeting, etc…..)
    Yes!!!  In Southern Maryland alone there are over 1700 homes on the market.  You need to have your home stand out amongst the competition.  So, yes, if you have turquoise Formica countertops, pink carpeting or black walls – they have to go.  As I said before, you need to neutralize the home.  Bold colors need to be replaced with a softer neutral color, but that doesn’t mean it has to be white.  We can usually find a neutral color in the same family as the bold color — the client is happy and the house is neutralized.
  • What are some of the common mistakes sellers make when preparing their house to go on the market? 
    Not preparing the house for market.  Most clients think their house is wonderful and there is nothing wrong with it.  When Bob gives me a listing, I do a complete walk-through on the home and tell the clients what needs to be completed in the home before it goes on the market.  Most times, rooms will have too much clutter or too much furniture, especially if there are kids in the home. 

    Closets need to be cleaned out, as well as kitchen pantries, because a potential buyer will look in the closets.  I tell the client that if the closets are packed full, they are essentially telling potential buyers there isn’t enough storage in the home. 

    You need to purge and clean before putting your house on the market.  Our goal is to make every home look like a show house before it goes on the market. 

AmeriDream Under Attack September 13, 2007

Posted by bobgauger in AmeriDream, General, Real Estate Agents, Resources.
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I was recently introduced to AmeriDream, a non-profit organization that helps people purchase homes by way of an innovative down payment program called “down payment gifts”. This is a program helping people since 1999, and as of today, has helped 224,897 individuals and families reach the American Dream of homeownership. To put this in perspective, on average, every 22 minutes there is a new homeowner because of AmeriDream. Basically, a seller “gifts” part of the purchase price back to the buyer to help with down payment assistance.

However, recently, AmeriDream and other non-profits in the down payment gift industry, have come under attack by HUD. See here (from blog entry: http://blog.ahaanow.org/ahaa/2007/08/affordable-hous.html):

Affordable Housing Program in Jeopardy

An effective, affordable housing down payment assistance program, administered by nonprofit organizations that have helped nearly one million low-and-moderate-income families become homeowners, would be eliminated under a federal proposal submitted by the Department of Housing and Urban Development (HUD).

Nonprofits such as AmeriDream, Inc. of Gaithersburg, MD and Nehemiah Corp. of America, of Sacramento, CA would be banned from providing down payment help to homebuyers who qualify for a FHA-insured mortgage, but lack the money they need for down payment and closing costs.

HUD has proposed the new rule in response to its concerns that the contract sale price is “often increased to ensure that the seller’s net proceeds are not diminished” in transactions involving nonprofits that provide downpayment assistance.

Currently, nonprofit organizations that provide down payment assistance account for nearly 40% of all FHA-insured loans.

The National Association of Homebuilders has already publicly voiced it support for nonprofit organizations like AmeriDream. In addition, the Mortgage Bankers’ Association (MBA) has gone to bat for seller-funded down-payment assistance.

“Down payment assistance is a key to expanding homeownership,” David Ledford, a vice president of the National Association of Homebuilders, said in a recent interview with Bloomberg News. “We think guidelines can be developed to keep prices down.”

If you are concerned about the negative impact that this rule will have on mortgage lending or if you are a home buyer that could now be locked out of an opportunity for homeownership, your local representative needs to hear from you. Please go to the Take Action page of AHAA to take action.

My thoughts are … a home won’t be financed if the sale price isn’t substantiated by the lender’s appraisal. Therefore, if a buyer and seller come to an agreement for the sale price (which is confirmed by the lender’s appraisal), it’s between the seller and the buyer if the seller would like to “gift” some of the purchase price back to the buyer in the form of a down payment. Whether using a service such as AmeriDream, this practice occurs regularly, especially in today’s buyer’s market. Many sellers assist the buyer with closing costs, credits and down payment assistance. Why should HUD interfere between a seller and buyer’s contract when both parties agree and benefit in the transaction?

What do you think?  Share you thoughts here.