$155,000

3713 Verde Drive, Fort Worth, TX 76244

MLS # 11355046

Pictures coming soon!

For more info please contact:

Lisa Pender
817-253-8840
Jolynn Blake
817-680-5112
Century 21 Worldwide
1727 Keller Parkway
Keller, Texas 76248
817-379-3111 office
817-379-4013 fax

$117,000

7728 Kelly Lynn Lane, Watauga, TX  76148

MLS# 11350914

Pictures coming soon!

For more info please contact:

Lisa Pender
817-253-8840
Jolynn Blake
817-680-5112
Century 21 Worldwide
1727 Keller Parkway
Keller, Texas 76248
817-379-3111 office
817-379-4013 fax

1536 LAKEVIEW DRIVE, Keller, TX 76248

LS# 11294834

For more info please contact:

Lisa Pender
817-253-8840
Jolynn Blake
817-680-5112
Century 21 Worldwide
1727 Keller Parkway
Keller, Texas 76248
817-379-3111 office
817-379-4013 fax

2009 was extremely busy.  Jolynn and I sold the most houses of any year we have been selling houses.  And to top it all off I had a baby in November of 2009.  My sweet little baby girl.  But I am back at work now and playing catch up on all that I have missed.  Thank goodness for my Real Estate partner Jolynn!  She is wonderful and helps me juggle life and work at the same time.

They currently range in price from $350K to $120K.  Hopefully when I get back in town (I’m on vacation) I can write about them. 

Jolynn is holding down the fort but I was swamped the week before I left.  I know this week has been just as busy.  Hopefully I will find time to post a couple articles while I am out of town.  The biggest thing to talk about is appraisals!  Government and their changes are affecting us once more.  I hope to update everyone soon!

Not only is the market itself going through a transition but so is the banking industry.  And even though many of our buyers have come in with pre-approval letters they have met problems in getting a loan to make it to closing.  Mortgage companies are taking about 45 days to close if the buyer has no problems but with problems it could take much longer (we currently have a closing that is approaching over 2 months to get to closing due to mortgage delays). 

Real Estate agents are also going through a transition.  There are less agents out there.  Numerous offices have closed.  And there are fewer homes being sold.  The sellers agent is having a harder time making money to survive.  Buyers agents are also working three times as hard to get an offer to closing.  Leases are hot but for an agent they can cost more out of pocket than the agent often makes.  And trying to stay educated on all the changes and possibilities a seller or buyer can run into has become difficult.  Every short sale is different, and every foreclosure is different.  The banks often have their own forms and their own set of rules.  And trying to decide who is capable in buying a house whether you represent the buyer or seller has become a big challenge.  Numerous houses are sitting on the market and to get them sold it is taking a strong marketing plan (not just a price reduction as numerous agents tend to think). Just putting a house in the MLS is not enough.  Agents really need to think outside the box to get houses sold.

I continue to expect more changes to come as this year continues.  If nothing else it has not been a boring year.  Transition may not be fun but at least it keep us on our toes!

Because my partner and I hate to see our sellers take a hit we are recommending they not list at this time.  The exception to this is sellers who have enough equity or their area is holding enough value to sell without taking a loss.   Most sellers are listening to us.  It feels so weird to have had only two listings so far this year (and to have turned so many down).  Those that need to sell seem to be giving their homes away.  Most sellers don’t have the equity or their area is just not holding the value.   The buyers all know this is a buyers market. 

However if you are a buyer this is a great time to buy.  In our area the mid size homes area taking about 20K off the prices.  And the larger homes around 50K.    First time homebuyers can also find great deals.  The first time home buyer tax credit can give you up to $8000 back in 2010 (or 10% whichever is less).  That incentive makes me wish I was buying a first time home.  Free money and great deals are enough to make me jealous.   

Buyers will need to come up with 3 1/2 % down for their mortgage.  The rates are wonderful whether you plan to buy or refinance this is definitely the time.   So be sure to take advantage of what is out there if you can!

Short sales are still owned by the seller and NOT the bank.  However, most short sales are at least 90 days behind in house payments.  So the seller hopes the bank will agree to let them sell it at a loss with no money owed at closing (or in the future).

The bank is NOT obligated to work with a buyer and seller to see that the house is sold.  Most sellers do not have enough equity so the bank is usually taking a loss.  Making their motivation even less.

The bank could foreclose at any moment.  There are no grantees.

Here are some steps to help your seller and you get through the process:

1. Talk to your broker.  Make sure your commission is negotiable.  Most banks will try to reduce your commission know up front what you can do.
2. Know how close the seller is to being foreclosed on (tell the seller to save the notices).  You need to have an idea of a time frame that you have to get the house sold.
3. Advertise it in the Multiple Listing Service as a short sale. 
4. Know the rough outstanding balance. 
5. Find out how many banks you are dealing with (if they have two loans).
6. Contact the bank(s) to find out who is the loss mitigation supervisor assigned to the seller’s loan.  Side tip:  Be VERY nice to these people.  They have a pile of short sales on their desk.  Being rude or upset is not going to help your seller. 
7. Get title work up front (in title states) before you get a contract.  This will help speed up the process. 
8. When the offer arrives, protect your seller.  Get the correct language to write in the contract so they do not have to bring money to closing.  It should also include information that states the sale is contingent upon lender approval.  This language needs to be obtained from an attorney.  Your title company will be able to help you with this (have the language before the offer comes in). 
9. Make sure close date is realistic. You need time to negotiate with the bank.
10. Send the contract over with Comparative Market Analysis to help bank determine value (most will perform an appraisal before accepting an offer). 
11. Make sure that the bank is forgiving the debt if not the seller may still have liability after the sell.  Make sure they are aware of what ever is coming their way.  (Banks can also issue a 1099 for that forgiveness of debt. In which case, this could also show up as income on their tax statement).
12. Once agreed tell everyone (seller, buyer, and title company) that they will obtain a formal short sale payoff statement and can begin moving forward with closing.
13. Continue to keep in touch with everyone periodically until closing (including the bank)!
14. Pat yourself on the bank, congratualtions you did it!

Short sales are still owned by the seller and NOT the bank.  However, most short sales are at least 90 days behind in house payments.  So the seller hopes the bank will agree to let them sell it at a loss with no money owed at closing (or in the future).

The bank is NOT obligated to work with a buyer and seller to see that the house is sold.  Most sellers do not have enough equity so the bank is usually taking a loss.  Making their motivation even less. 

The bank could foreclose at any moment.  There are no grantees. 

Here are some tips to help you and your buyer:

1. Have a talk with the buyer explain the process of short sales.  Make sure they are prepared for what may come. 
2. Attempt to discover value.  Prepare a Comparative Market Analysis.  Attempt to discover how much the seller’s owes.  Look at the tax value.  Look at how fast homes in the neighborhood are selling in the neighborhood.
3. Help your buyer come up with a reasonable offer to present to the bank based on your evaluation of the value.  If the bank could easily expect to get more than the offer your buyers want to present the bank may never respond. 
4. Give a time frame in the contract of how long the buyers are willing to wait for the seller to get a response from the bank.  A good estimate is 7 to 14 days.  Most short sales take longer than the average 30 days to close.
5. Find out if your state has a “short sale addendum” that needs to be included with the contract.
6. Submit your offer to the seller’s agent.  Help the agent understand your buyer’s offer so they can explain it to the bank.
7. Don’t be surprised if the bank asks you to reduce your commission.  Know up front what your broker will allow you to do.
8. Call the seller’s agent every few days to help your buyers stay in the loop.  
9. Negotiate the contract as needed. 
10. Make sure the bank has signed off on the offer.
11. Inspect.  Short sales are generally sold AS IS.  The bank will usually not allow for repairs.  If the buyer’s lender requires the repairs the bank may make an exception. (If the buyer’s lender requires the repairs, bid estimates will need to be presented to the bank to negotiate for those repairs.  If the bank will not negotiate for those repairs then you may want to make sure the buyer has a way to get out of the contract).
12. Continue to keep in touch with the seller’s agent (buyer and the title company or closer).  Stay in the loop until closing.

A few weeks later the lender calls me and says it would be best for this couple if they could roll in $7000 of their closing costs into the price of the home.   Just to help understand this.  The contract amount is $175,000.  The buyer needs $7000 cash to buy the house.  So we took the $7000 and added it to $175,000 bringing the new contract price to $182,000.  The seller then issues a credit at closing for the $7000 to the buyer.  The buyer uses this money to pay their closing costs instead of having to have the cash in hand.  However, their loan is now $182,000 so they in essence finance that additional $7000 for the term of the loan.  The house also has to appraise for the $182,000. 

The seller agrees to the changes and contract changes are made to reflect the new sales price and the $7000 back to the buyer.  Everything seems to be going smoothly until we get to closing.

At closing the paperwork comes out and I start looking at it.  The settlement statement (HUD-1) shows the buyers closing cost came to $6300 and not $7000.  I inform the buyers that we have a problem.  The way the paperwork is they will be giving the seller an additional $700 for the house because they can not get money back at closing.  There are three options: 1.) delay closing so the lender can redo the loan amount to $181,300 2.) have the seller refund the money after closing 3.) see if the lender will let them have the $700 cash back at closing 4) let the seller keep the extra $700. 

Well scenario one didn’t work because the buyers had already ended their apartment lease and couldn’t stay without having to pay another months rent.  And the third option the lender wouldn’t allow them to do and the forth option was not desirable.  But the problem with scenario two was there was nothing that obligated the seller to give back this money.  I inform them of this.  But they don’t have much choice so they close on the house.

I then spend the next THREE MONTHS working on trying to get this money back from the seller.  I email, mail, and call him.  Finally, the seller agrees to refund the money and they did get it back. 

With the end of 100% financing hopefully that will be the end of that problem.  I saw that same problem while representing other sellers and buyers.  Lenders often do an estimated guess on the closing costs.  And sometimes they are wrong.  If you really don’t have the cash just realize you may be paying more for the house then you planned.