Foreclosure News

• "We have only begun to see the foreclosures", says Debbie Goldstein of the Center for Responsible Lending.
• 9 out of 10 real estate agents don't know what a short sale is. (survey)
• An estimated 2 million American homeowners face increased monthly mortgage payments in '08 (boston.com)
• Experts predict that foreclosure rates will continue to increase throughout 2008 and into 2009 (yahoo news)
• RealEstateJournal.com predicts that home values will fall 7% on average nationwide during 2008.

The market has changed... We can help! Don't hesitate, call us today!

Frequently Asked Questions

What is a short sale?

A short sale is when a bank agrees to take less money than what they are owed on a property mortgage. For example if the bank is owed $250,000 and they agree to sell the property for $200,000. The bank is taking a $50,000 loss on the transaction. Although the bank has taken less money then they are owed, the full debt amount is eliminated. This is a short sale.

What is a short refinance?

A short refinance is a relatively new concept that is gaining more and more traction in the industry. Similar to a short sale, a short refinance allows you to reduce your current mortgage balance and refinance into a fixed rate loan. Rather than having to sell your home, you are able to stay in the home you love with more favorable terms. More and more lenders are realizing that this is a better alternative to a short sale or foreclosure and are adding short refinances to their workout options. However, because a short refinance is a newer concept some banks have yet to adopt them and at this time are not offering homeowners this option. We will help determine if your lender will allow you to do a short refinance and what they will require to do it.

Why would the bank ever take less than what they are owed on a property?

You will be surprised to learn that banks take less than what they are owed on mortgaged property every day of the year. There are numerous reasons why the bank will sell a property for less than what they are owed; here are the most common reasons:

1. A foreclosure. When a homeowner is not paying their mortgage the bank is losing money. In addition, the bank now must pay the taxes, insurances, utilities, attorneys fees, Realtor fees, auctioneer fees and much more. The bank does not want your house, all the bank wants is their money. In most cases the bank is willing to sell the property at less than what they are owed so they don’t have to deal with these expenses as well as the hassles they entail.
2. The homeowner is 100% leveraged with no equity left in the property. A home that was worth $200,000 a few year ago is now worth 10-20% less! If a home that was 100% financed a few years ago goes into foreclosure the bank is faced with potentially taking back a house that they are owed $200,000, but the house is only worth $175,000. The bank is upside down. Furthermore as mentioned above the bank has to pay all the expenses through the foreclosure. By the time the bank gets the house back from the homeowner their expenses combined with the mortgage could easily be $230,000 or more!! In this situation the bank is extremely motivated to take less money than what they are owed.
3. It is required by federal law that every bank has what is called Reserves. In most cases the bank must have 10% of the total amount of money they loan out set aside as Cash Reserves. A mortgage loan works the same way. For every loan the bank has that is a good ‘performing’ loan the bank can loan additional money against it. If a loan is non-performing then they can’t loan against it. One bad loan can effect them lending thousands and thousands of dollars. This is just another reason why the bank will take less money then what they are owed on a bad loan to get it off their books.
4. Owning real estate is a huge liability for a bank. If someone gets hurt on the property, the bank potentially will face a lawsuit which could cost them millions of dollars.
5. The house needs extensive repairs. Homes that need repairs don’t sell for full value. If the bank owns a home that needs repairs they will often have to sell for less because no one is willing to pay full value for a home that is in need of repairs.

How much will this cost me?

There is a one-time processing fee required to compile, originate, complete and submit your full package to the lender. We do not charge anything for performing a short sale or a short refinance. We make our money by putting a fee on the HUD-1 settlement statement when the property sells. The bank pays us this fee because a short sale typically saves them money. This way our success is tied to your success, so you know we have your best interest in mind.

What if we decide to do a short sale but change our mind, can we stop the process?

Yes you can. We want what is best for you. If you decide to go in a different direction we will part as friends. A short sale is a great option for many homeowners, and in most cases turns out to be the best option. The short sale will eliminate your debt and stop the foreclosure if you can't sell your home for what it is worth. We will explain this in more detail as we work together.

How much money will I get when I do a short sale?

The answer is nothing. It is illegal for us to perform a short sale and then give the homeowner a kick back from the deal. The short sale helps you avoid foreclosure and eliminates your debt. If the property goes to foreclosure you will be left with nothing, you will still be responsible for the back debt, and your credit will be ruined for at least 7 years. The short sale allows you the opportunity to move on from the property debt free and credit in tact so you can start fresh.

If I decide to do a short sale or short refinance, am I guaranteed that you will succeed?

There is no guarantee that we will be able to stop your foreclosure and perform a short sale or refinance your loan. As outlined above, it is in the bank's best interest to do so, but that doesn't always mean the bank accepts the deal. We have a skilled and knowledgeable team who work hard to stop the foreclosure and perform these tasks; but we aren't always able to come to terms with the bank. If we are unable to come to terms with the bank, the foreclosure will be carried out by the bank as planned. However, it is important to know that in almost every case we are able to extend the auction date. So even if the bank doesn't accept the short sale, we can buy you additional time to sell the property.

Do you deal in higher price Homes?

Yes, we can work with higher priced homes. Our techniques and solutions work in any price range.

What if I am behind on my payments, can you help?

Yes, if you call we can get the information from you needed to stop foreclosure, save your credit and give you debt relief. Learn more about Short Sales above.

What's the catch?

There is no catch! We will customize a deal, if it works for you, then that is that. No extra commissions, no extra fees, no extra hassles!