A recent court case underscores a recommendation I have been making for agents involved in short sale cases.     The homeowners contracted with a real estate agent to sell their home.  With the drop in market values, the agent helped the homeowners understand that they could still sell their home as a short sale.     The homeowners agreed and the agent went to work listing the property and seeking buyers.  They finally obtained an offer from a cash buyer, which looked great and had a good chance of being approved.     As we all know, this past spring short sale processing by the servicing lender and the secondary market investor (SMI) slowed to a standstill.  The contract terms made the contract terms binding and subject to third party lienholder approval of the short sale within 120 da... 10/29/2009

Ready for change?  Here it comes...or is it?     Through these articles, or blog posts, I have been attempting to educate agents concerning the many, many issues of misinformation that have provided in short sale books, courses, and training seminars.  Since I really have more of a warm heart of a teacher than a lawyer, I want to be of service to those of you who appreciate it.     So, I have helped bring clarity to who owns the note, the secondary market investor (SMI), and who approves short sales, the SMI, not usually the servicing lender the proposal is submitted to.  I have also attempted to help you understand that the old method of analyzing a short sale which merely compared the amount of loss if the short sale is approved has been replaced by most SMIs to the new net-to-lender... 10/18/2009

  There was a recent press release from the U.S. Treasury that stated that the Treasury Department would soon finalize plans to increase incentives for "banks" to approve short sales.     The "banks" here includes both the servicing lenders and the secondary market investors, and it is usually (but not always) the secondary market investors who approve the short sales.   The problem first came about when the mortgage crisis hit and people began losing their homes en masse.  The Treasury Department did little at that time.  This crisis also increased almost exponentially the numbers of short sales being processed by the servicing lenders and reviewed by the secondary market investors.   The servicing lenders were also in a severe financial crisis and many failed.  So add a financial cris... 10/06/2009

I watch a lot of short sale real estate agents, investors, and other business people struggling to stay on top of all the many details in running a successful business.   Moving a short sale business from a start-up or even a stumbling position to an income-producing successful business is all about conforming your business to a successful model and then creating systems that are either automated, performed by "trained monkeys", or minimize the amount of time taking care of the business of business.       Short sale Systems, or any system for that matter consists of people, technology, checklists, or procedures.  Anytime you find yourself getting bogged down, you create a system to open up the bottleneck.     One way to obtain more results from short sales with less time and effort is t... 10/04/2009

A lot of people have been required to sign a promissory note as a condition to the lender approving a short sale.   The promissory notes are usually for a small to moderate percentage of the deficiency balance, paid over ten (10) years, with no interest.  The promissory note requirement is usually a good deal, and see my other articles on this subject concerning predicting when a promissory note will be required.       However, many homeowners are in severe financial distress, and the thought of having another payment following the short sale is not a happy one!   Most borrowers after a short sale need to find a place to rent, and another payment on top of rent might often push the borrowers over the edge.  It is often the case that a short sale falls through simply because the borrowe... 09/16/2009

In the last article, we discussed the basis upon which lenders will seek a deficiency balance and how to predict it.   The question then comes to the issue of when a promissory note will be required as a condition of approval of the short sale. Since the debtor owes the entire deficiency, a promissory note with no interest and easy terms for only a portion of the balance is not unreasonable. Although usually the secondary market investor (SMI) requires seeking the deficiency balance after short sales, but sometimes it will be the servicing lender.   I am poviding merely a guide. Promissory notes are not always required, but the following factors may be helpful to be prepared if a promissory note is required in your short sale case.   1. Borrower has assets. A borrower with a true hardsh... 09/01/2009

Many homeowners and agents alike as what the odds are they will be required to pay a deficiency balance after a short sale.  Many bank release documents will not specificially state whether the short sale will be in full satisfaction of the debt.   We've noticed a gradual change from a willingness to include language forgiving the debt to some even stating specifically that they are leaving open the possibility of seeking the deficiency balance, even though in fact they may not likely pursue it, unless of course, the debt is far in excess of the fair market value and the homeowner may either have assets or can be rehabilitated.     Pursuing the deficiency balance The decision whether to pursue a deficiency balance rests with the secondary market investor (SMI) unless the servicing agree... 08/25/2009

I often find agents mistaken in their beliefs why short sales are not approved, or do not otherwise close. While I certainly applaud successful short sale agents, there is widespread misunderstanding and misinformation about this topic.   As an attorney who has not only sold real estate (well, for a year and a half, that is), and has represented and dealt with servicing lenders and secondary market investors (SMI) over the last 20 years, I have a unique understanding of these entities and relationship with them. A number of those institutions have managers and executives who are friends of mine, and we have on numerous occasions discussed the issues causing short sales to not be approved.   So, here are the top reasons that a short sale does not close as I experience them with the agen... 08/23/2009

   There is circulating a popular legal concept for the homeowner to require the lender to produce the original promissory note in the event of impending foreclosure.   The lender who is the holder in due course (this is legal speak for the entity that actually owns the Promissory Note) must prove that the debt is due when the servicing lender forecloses on the property.        To produce the note is sometimes very difficult because the note may be in the possession of the servicing lender, the secondary market investor, or someother entity as the note passes to various entities. With all of the mergers, bank failures, and takeovers over the last several months, many records have been lost.        To prove that the foreclosing entity has a rightful claim merely reequires the "keeper of ... 08/19/2009

   There is a new Truth In Lending law which took affect this month (August, 2009) that will likely cause additional time needed to close in normal closings, but also in many short sale transactions.        Under this law, there is a 3 day delivery time period plus the 3 day right of recission period to review the Truth In Lending documents before the lender can charge them any fees, such as the appraisal. This means the buyer's lender can get started preparing for closing on day 7.  It also means then that a 30 day escrow will be difficult and may likely need an extension, which is increasingly more difficult now in short sales.      But that is not all. Under the new Truth In Lending Act , if the APR is off by more than 1/8 %, they need to re-disclose at the moment you think they're g... 08/17/2009

  For the 17th year, Idaho Falls, Idaho is the place to be on July 4th for one of the most amazing fireworks displays in the nation. Hosted by Melalueca, the "Freedom Celebraton" culminates in the largest fireworks display west of the Mississippi. This article ranks the Idaho Falls fireworks display #17, right after Disney World's "Celebrate America."  And this reviewer gives Idaho Falls the distinction of being #2 in the nation, only behind Philadelphia. More than 100,000 visitors flock to Idaho Falls from all over the state and across the nation to view this spectacular display.  And while parking can be a problem, the show -- which typically lasts about 1/2 hour and is coreographed to popular and patriotic music -- is worth the trouble. So come to Idaho Falls, a great city and a gre... 07/02/2009

Lets Help Jack Together! We are now up to 191.52 in donations!! Please keep them coming! Thank you so much for all you're doing!  Recently I posted a blog to help a friend / colleague of mine in my office at EXiT Realty of Idaho Falls, ID.  His name is Jack Wise and he has just recently been diagnosed with throat cancer and has very poor chances of recovery.  As you can probably imagine, this is a very emotional and traumatic experience for Jack and his family as it would be for any one of us and our families.  Like a good majority of us "independent contractors," Jack has no health insurance coverage for he and his family because of the high costs of private insurance plans.  Without this necessary medical coverage it usually means that health providers in our wonderful medical industr... 11/13/2008

Recently I posted a blog to help a friend / colleague of mine in my office at EXiT Realty of Idaho Falls, ID.  His name is Jack Wise and he has just recently been diagnosed with throat cancer and has very poor chances of recovery.  As you can probably imagine, this is a very emotional and traumatic experience for Jack and his family as it would be for any one of us and our families.  Like a good majority of us "independent contractors," Jack has no health insurance coverage for he and his family because of the high costs of private insurance plans.  Without this necessary medical coverage it usually means that health providers in our wonderful medical industry here in the United States probably will not give him the kind of care every one of us would deserve.  In Jacks case, the unfortu... 11/12/2008

Spam Premevara I just love GMail!  I was clearing out my Spam box a few days back and noticed that you get free spam recipes every time you go into your spam box section of gmail!  I immediately proceeded to ask my wife if she could try one of these recipes out for me.  I'll be the first to admit, and I'm especially not ashamed to admit it right now, that I really like Spam!  It's high in cholesterol, fat, salt and all those good things for the body!  Anyway, I had her make this recipe for me and I would highly recommend it to all the closet Spam lovers out there! HINT: If you don't want to get too involved with a huge recipe using spam you can always just slice some up and throw a couple of slices of cheese and some mayo between two pieces of bread too!  Mmmmmm  Mmmmm  good!  I also li... 11/11/2008

Computer Security Let me just start by saying that I'm not a computer geek by any stretch of the words but I can boast just a little here... I haven't ran computer virus software consistently for the last 8 years and I don't plan to run one anytime soon either.  The general media and computer stores of the world would have you believe that you can't get by without having some sort of expensive virus software installed, updated and running at all times on your computer while it's in use.  While, this may be true for many people that have absolutely no intellect when it comes to computers at all, my wife, kids & mother come to mind here, it's not always true for a great deal of people.  There are some things that you can do to protect yourself without using a virus scanner.  Education is ... 10/30/2008

The financial meltdown: Is it the Starbucks effect?Is Starbucks a stock to watch? As a financial indicator who would ever guess that watching a smaller company (and I say this with my tongue in my cheek) would make sense? I would have never guessed until I read this article. Daniel Gross, a columnist for Newsweek suggests that the global financial melt down could be predicted by watching places where Starbucks has set up shop in this article. It's a good read and an interesting take on what could prove to be true in my eyes.My wife works for the local Starbucks here in Idaho Falls, ID so that the family can have some kind of health insurance. For 20 hours a week Starbucks will reward it's partners with an insurance program through Aetna Insurance. It's darned good insurance too when you... 10/27/2008

Breaking News: Good News for Real Estate? Largest Monthly Home Sale Percentage Increase in 5 Years Reported RISMedia A little better news from under the medias radar again it would seem. This is an interesting article that may be worth a little more study it would seem. It is a direct contradiction to everything you might hear in the "other" news from around the world and the nation. Could it be that things may be bottoming out? Could it be that this was truly just a cyclical trend that is starting to correct itself? It's anyone's guess but would more than likely be very welcomed "good" news in the world of real estate sales. I would very much like to see things start moving again even though Idaho Falls still has not taken the direct hit that the rest of the nation has with regards to... 10/24/2008

Merck's Free Radical - Forbes.com Stephan Friend, a scientist with an attitude towards the future of cancer research. One has so many mixed feelings about this morally and ethically but once cancer has touched your life stories like this become heroic. My hats off to a guy that fought cancer in kids and is trying to find a cure for this dreadful disease that comes in many forms to all races and ages from every part of the world. I just thought I'd write something a little off the topic of Real Estate for once. Lord knows we need a break from the mundaneness of the financial world and "housing crisis" for just a few minutes! A person can only handle so much economy news before they jump off a cliff. It's nice to know that throughout all this mess there's still people like Stephen Friend... 10/24/2008

As the current economic credit and financial crises upfolds, people tend to want to know one thing:  Can I still get a loan to buy a house?  This is the bottom line question I'm hearing from my clients. The answer is "Yes", but with caveats.  You must be ready, willing and able to pony up the proof that you're a good risk for paying back the loan.  Banks are running scared.  There is money out there, and there are some banks that are still lending (though few and far between).   Your must show a fairly high credit score (something near or above 700), and you must show proof of income (and it MUST be legitimate).  Lenders are pickier and choosier than ever (and with good reason) and want more stringest and verifiable proof from potential borrowers. If you DO qualify for a loan and you se... 10/13/2008

                                      1Q 2007                    1Q 2008                   Pct. Change Homes soldBonneville Country        390                      267                  -31.5Jefferson County            52                         46                  -11.5Bingham County            82                         62                  -24.4 Median sale price Bonneville County       $148,700               $157,000            +5.6Jefferson County        $176,650               $192,500            +9.0Bingham County         $127,500               $129,500            $1.6 Average days on marketBonneville County              97                     102                 +5.1Jefferson County               98                     108                  +10.2Bingham County                91     ... 07/05/2008