Foreclosure Radar reports a drop in Notice of Default(NOD) filings from this time last year. The data supports our recent experience between investors and our clients who are working to modify their loans or short sale before a NOD is filed. I have been seeing more cooperation by lenders and servicers when communicating our intent ahead of time.
Foreclosure is a Reality in 2011
The federal government has provided relief programs to help those who would like to modify their loan and the Obama administration efforts continue but there have been recent attempts by federal legislators to kill HAMP. As you see in this chart investors are also throwing in the towel and my sense is that those people who haven’t made a mortgage payment in 18+ months are now going to have to come to grips with the reality that foreclosure is on the near horizon.
Cancellations have dropped indicating that modifications and/or a short sales continue to be a challenge for some homeowners. REO numbers also indicate that banks are steadily foreclosing in Santa Clara County.
Affordable Market Hit Hardest
The chart below shows the $300,000 to $500,000 real estate market has been impacted the most in February.
The Santa Clara County Housing Trust will hold a workshop on March 22nd 2011 for homebuyers interested in down payment assistance and opportunities to purchase homes from the National Stabilization Program.
For More Information visit http://www.housingtrustscc.org/programs/nsp.php
Hope Now and Making Home Affordable are federal agencies created to help consumers who are struggling with their mortgage payments. The San Jose Convention center will be the location for this event this Thursday February 24th from 11:30am to 7:30pm.
Click here to download the flyer.
The Department of Real Estate has made a shift in their staff workload from licensing to fraud prevention and protection of the pubic. One of the areas that has become a priority has become short sales and how licensees are offering services to the public to deal with short sales.
A trend that has become an issue has been buyers who entice listing agents to submit their offers only to the lenders for approval. The issue is with regard to agency(who the agent represents in the transaction) and it can create a legal problem with the listing agent and the homeowner. The banks want the best offer the market supports. Flippers are more likely to make an offer lower than a competing offer. This presents a problem for the homeowner and the listing agent. Homeowners must submit highest and best to protect themselves.
Negotiators must be licensed
The primary requirement for negotiating a short sale is that the individual performing the negotiation must be a licenced real estate Broker or a salesperson supervised by a broker. Sellers must verify the negotiators licence status on the DRE website dre.ca.gov.
Paying a Short Sale negotiation fee
A listing agent that requires the buyer or buyers agent to agree to pay a short Sale negotiation fee on behalf of the seller is in violation of real estate law. An update published in September goes into detail regarding this issue. ConsumerAlert_ShortSalesUpdate
The DRE has recently issued a consumer alert with the intent to assist homeowners navigate through the short process.
DRE_ConsumerAlert_ShortSales
I just hung up the phone with a representative from CHASE who introduced herself as a coardinator for a new loss mitigation department created by CHASE to speed up their rediculously slow short sale approval process.
How do you spell relief?
I spell it A P P R O V A L.
All kidding aside it has not been a a very plesant experience for some of our WAMU/CHASE clients looking to short sale thier home. in fact is has been excruciatingly slow. It literally took seven months for me to get an approval from CHASE on one of my listings only to find that the buyer who had waited for the entire time walked himself into another home. Many sellers we encounter who have WAMU loans has found themselves in the same situation. For that reason I always set an expected six month worst case scenario on WAMU short sales.
How do I use this new information?
If you are contemplating short sale as an option and have a WAMU/CHASE/EMC loan the first thing to do is compete the CASE short sale packet updated in April 2010.
Download CHASE Short Sale Packet
You will also need the following information:
- Listing agreement
- Letter of Authorization for your REALTOR to communicate with the lender
- Listing History from the MLS
- Hardship Letter
- last two years tax returns
- Two months bank statements
- last 30 days proof on income wage earner or self employed (paystubs or profit & Loss or bank statements)
- Purchase contract and pre approval letter from a buyer
Uncharted Territory
Nobody really knows what all this movement means in terms of the approval process because every short sale situation is different. Perhaps this is CHASE’s way of adopting HAFA into their systems. What I do know is that we have come a long way in the last six months and the effort by the lenders to streamline the short sale approvals if much appreciated by the people who need it the most, our clients.
CHASE Short Sale information: www.chase.com/shortsale
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