Investor Short Sales Part Two

Yesterday I gave you five key points to determine whether or not you should list your house with an investor who is ultimately going to purchase your home in a short sale situation. Here are a few more topics.

6). Earnest deposit. Let's face it, an earnest deposit is required on nearly every real estate transaction in the United States. So expect them to open escrow upon your acceptance of the purchase offer and put down a reasonable earnest deposit.

7). What if the offer is cash? Well then you should require to see proof of funds, you may be surprised to find out that some cash offers are really not cash at all. It is just financing and a buyer trying to present a "better looking" offer.

8). You need to know what will happen if the bank does not accept the offer that is presented from the investor. Your home is listed with their preferred listing agent, who has submitted an offer to the bank with an amount they want to pay for it. Remember you as the seller have signed the purchase offer and agreed to sell your home to them. You cannot just back out now, but what if the bank is not accepting the offer? Will they continue to market your home to other potential buyers? Or will they keep your home under contract until it forecloses.

9). As with any transaction, whether it be real property or other, you need to use your best judgment and be sure to do your due diligence.

As with any real property transaction in Maricopa and Pinal counties, we recommend you use us! Marie Zubkoff 480.233.7051 and Andrew Walsh 602.527.2639 with US Preferred Realty. Visit us at http://YourGilbertHome.com Thank you!

Investors Listing & Buying Short Sales?

Have you been contacted by an investor that wants to list and buy your short sale? Here are five tips to think about and questions to ask before listing with them. We will cover more on another day.

1). Are they requiring the use of their preferred listing agent or REALTOR? If so who is that listing agent representing. Who is going over the listing agreement with you? Is it the investor who is buying the property or the listing agent who is supposed to represent you?

2). Make sure you receive and fully understand the agency disclosure and election. NO real esate transaction should ever take place without a buyer AND seller acknowledging both sides by signing this!

3). What are the current market comparables to your home? Ask for this and review them. Make sure the homes accurately represent yours.

4). Short sale addendum, make sure there is a short sale addendum included and you thoroughly read and understand it.

5). Look for, Read and Understand the opt out clause. Generally as a seller if you accept a buyer's offer, you must sell your home to them. In the presence of a short sale though, the sale is contingent upon the lender's or "third parties" approval (if a short sale addendum is included).

A bonus tip when you are working with investors, is to make sure all of the forms are drafted from boiler plate Arizona Association of REALTORS forms. These forms are created in the interest of the general public. Please please please if you do not understand any of the forms, consult an attorney to help explain them to you.

If you are approached by an investor looking to purchase your home, please also interview other agents whose primary focus is to sell your home rather than buy it to make a profit. A traditional REALTOR has the same goal as you which is to sell the home. Not to buy it in hopes to make a big profit.

Contact Marie Zubkoff at 480.233.7051 or Andrew Walsh at 602.527.2639 with US Preferred Realty to discuss your Arizona Real Estate needs. If you are a buyer or seller, we can help. visit us at http://YourGilbertHome.com Thank you!

Underwater Homes

Another real estate milestone number crunch. Due to the decline in home prices, now 32% of homes in the US are without equity as compared to 15% a year earlier. This is according Moody's Economy.com. The states at the top of this list? You ready? They are pretty close... Nevada at number one with 40%, Arizona number two at 37% and California number 3 at 33%. Who is doing the best? Well that is West Virginia at 13%, and Louisiana at 16% is number 2. Here is an article you may find of interest at the WSJ. http://blogs.wsj.com/developments/2009/08/05/more-homeowners-upside-down-on-mortgages/

Remember for your Arizona real estate questions and needs, contact Marie Zubkoff 480-233-7051 or Andrew Walsh 602-527-2639. Your US Preferred Realty agents, visit us at http://YourGilbertHome.com Thank you!

Short Sales

Much has been made of short sales and foreclosures in the state of Arizona. People generally argue which is better and often bring the topic of bankruptcy in their conversation. This post will be relatively short considering the depth of this overall topic of Arizona Real Estate. Some key differences between a short sale and foreclosure are the credit reporting, a foreclosure will do more damage to your credit score and for a longer period of time. Your eligibility to get another loan (conforming loan that Freddie or Frannie would buy on the secondary market). If you are foreclosed on a home, then you cannot get a conforming loan for FIVE (5) years! A short sale will only cost you TWO (2) years. In a foreclosure, if the lender (usually the second if it is a HELOC or a cash out refinance) has a right to a deficiency, they can still try to collect from you after a foreclosure. In a short sale, it is sometimes possible to have both or at least the second lien holder to put in writing they will NOT pursue the deficiency! There are three valuable reasons to entertain a short sale instead of a foreclosure. I did not discuss a "Deed in Lieu of Foreclosure" because lenders generally will not accept those without first trying to do a short sale, and a Deed in Lieu will leave that lender responsible for all other liens on the property.

Contact Marie Zubkoff 480.233.7051 or Andrew Walsh 602.527.2639 for more information on a short sale. If you need a referral to a qualified CPA or Attorney, call us we can get you help. http://yourgilberthome.com/

Arizona Residential Landlord and Tenant Act

The Secretary of State has issued a new Landlord Tenant Act in February of this year. However they will no longer be available via print once the current issues run out. So either call today and pick up your free printed copy, or you can go to this link http://www.azsos.gov/public_services/Publications/Residential_Landlord_Tenant_Act/residential.pdf and print out your own copy. Either way, for those of you who own rental or investment properties and those of you who are renters, PLEASE do yourself a favor and print off the latest copy and read.

If you have other questions or need a property management service or a referral for legal advice, contact Marie Zubkoff 480-233-7051 or Andrew Walsh 602-527-2639 right away for your Arizona Real Estate needs.

BEWARE -Bogus Property Tax Offer

Please read the following message from Arizona Attorney General Terry Goddard:

Attorney General Terry Goddard is warning Arizona homeowners to be wary of official-looking advertisements claiming that a homeowner’s property qualifies for a “property tax reduction review.” This solicitation appears to be an attempt to scam homeowners who are looking to reduce their property tax bill.

The solicitation, which requests a $189 processing fee, is not affiliated with any government entity. The document attempts to appear official and contains a “notice number” and deadline for prompt processing.

Assessed valuations for 2009 cannot be changed since the appeals process for 2009 has ended. In addition, there is no fee required to file a property valuation appeal with county treasurers’ or assessors’ offices in Arizona.

If you believe you have been a victim of consumer fraud, please contact the Attorney General's Office in Phoenix at 602.542.5763, in Tucson at 520.628.6504, or outside the Phoenix and Tucson metro areas at 1.800.352.8431. Consumers can also file complaints online by visiting the Attorney General’s Website. To file a complaint in person, the Attorney General’s Office has satellite offices throughout the state with volunteers available to help. Locations and hours of operation are posted on the Attorney General’s website http:///www.azag.gov/

If you need other information, contact Marie Zubkoff or Andrew Walsh, your Arizona real estate professionals.

First Time Homebuiyer's Tax Credit -CLOSING COSTS

The first-time homebuyer tax credit can be used to pay closing costs or an additional amount over the required 3.5% down on an FHA loan. HUD has strict guidance and regulations on this so you must contact your lender for direction as to how the loan from the tax credit would be repaid and when. Using the tax credit for this purpose is done through what is considered to be a bridge loan or personal loan. For more information on the $8,000 tax credit uses in Arizona, contact Andrew Walsh or Marie Zubkoff for our recommendation of lenders and to ultimately purchase your property here in the valley of the sun.

$8,000 Tax Credit -How much will it be?

Follow the next couple days while we detail some of the information on the first time homebuyer's tax credit.

The maximum allowable credit is $8,000. The credit is equal to 10% of the purchase price of the home. The income limits are $75,000 for single buyers and $150,000 for married couples with incomes up to $150,000. The credit decreases for higher incomes, and eligibility is lost at $95,000 for single buyers and $170,000 for married couples.

Contact Marie Zubkoff or Andrew Walsh to purchase your home in Arizona. We work the entire valley, from Surprise, Florence, Casa Grande, Maricopa, Scottsdale, Phoenix, and all in between.

Weekend Freeway Closures

Are you tired of every time you go to see or show a house and you are driving on the freeway and run into a detour that had you known was there you could have taken a different route? Well simply sign up to receive weekly updates on freeway restrictions and closures at http://www.azdot.gov/ . You can receive email updates weekly. They are sent out by Brock Barnhart Community Relations Project Manager. You will thank him the next time you are the smart one bypassing the hour long delay! -This notice a courtesy of your friends in real estate!

Home discount coupons?

Your friends Marie Zubkoff and Andrew Walsh are currently in negotiations with a local company that is heading up a negotiation with local builders for us to market their properties and even provide YOU our clients with a coupon to discount the price of the house! Check back soon or contact us for details. This is intended to be available valley wide for our clients, whether in Gilbert, Surprise, Phoenix, Mesa, etc... You can save more on a new home when you contact Andrew Walsh or Marie Zubkoff first. Find out the added benefits of using a REALTOR instead of being a walk-in.

Senator Steve Pierce discusses SB-1271 with AAR

Senator Steve Pierce met with the Arizona Association of REALTORS regarding the recently passed bill SB-1271. The outcome of the meeting was agreement that there is a better way to help local banks in Arizona then the extreme the bill SB-1271 possesses. The AAR thanked Senator Pierce for his efforts, time and energy he has put forth to this issue. So hopefully soon the governor will repeal the bill so it may be modified to be more balanced for borrowers and lenders alike.

Buyer's Guide

If you are a new buyer in the market, please go to the buyer's page of our website http://www.yourgilberthome.com/contactform.asp and fill in your name, email and request a buyer's guide. We can email one right over to you! There is a ton of great information for you to start familiarizing yourself with the purchase of a home in Arizona. You may also contact Marie Zubkoff 480-233-7051 or Andrew Walsh 602-527-2639 directly.

New TILA Disclosure requirements. Who is TILA?

TILA is the Truth In Lending Act also known as Regulation Z. A new requirement added for Arizona as well as the rest of the nation for lenders to provide another disclosure. The new requirements apply to all mortgages including primary and secondary homes. Investor loans are exempt.

Lenders must give good faith estimates of mortgage loan costs within 3 business days after the consumer applies for a loan (early disclosure). The lender may not collect any fees before the disclosure is provided except for a credit report fee.

THE CLOSING MAY NOT TAKE PLACE UNTIL THE EXPIRATION OF A 7 DAY WAITING PERIOD AFTER THE CONSUMER RECEIVES THE EARLY DISCLOSURE!

Under strict circumstances this period may be waived by the consumer. It may NOT be a standard of practice for the lender to ask the consumer to waive this waiting period.

If the APR changes by more than 0.125 percent the lender must provide a corrected disclosure and wait an additional 3 BUSINESS days before closing the loan. The APR includes the interest rate and other costs related to the settlement of the loan.

Please contact Andrew or Marie for a lender referral if you are looking to purchase or refinance your home in Arizona! The source of this information is the arizona association of REALTORS.

The Dangerous SB-1271 for Arizona

What are some of the elements of bill SB-1271 that make it dangerous for the Arizona real estate market? Well let's take a look at some them pointed out in the letter the AAR CEO Tom Farley wrote to Governor Jan Brewer: Second/Vacation homes, rental property, and family-owned property may lose their anti-deficiency protection if the trustor did not utilize or occupy the property for six consecutive months. The loss of this protection could lead to deficiency judgments being placed on or against personal, real and perishable property. Bear in mind, deficiency judgments CAN result in the garnishmet of wages! Bankruptcy filings may increase because of this which will likely cause additional creditors to be harmed.

Another well thought out point Tom Farley addresses is that this amended statute is retroactive. So that it is not forward looking. The terms are not changed for loans that are originated after a future date, they retroactively affect all loans that have already been created. Also, lenders that receive TARP funds are also authorized to seek deficiency judgements against property owners after foreclosure. So a lender can foreclose... get a deficiency judgment... AND receive TARP funds? And all of this in one of the fastest states to file and foreclose on a home. Tom Farley is correct when he says "There are many reasons, .....to be profoundly concerned about the consequences of this bill".

A Call to the Arizona Governor

Apparently the Arizona Association of REALTORS has written a letter to the Arizona Governor Jan Brewer. It is a request to Amend the Call for Special Session to Address Issues Resulting from SB 1271's passage. In a letter dated July 22, 2009, AAR CEO Tom Farley writes a three page letter accompanied by 30+ pages of Case law and practical issues backing up his claim that the recently passed SB 1271 amendement to the anti-deficiency statutes has gone too far and shifts the now balanced power between owners and lenders to the lenders favor. In the form of a fast foreclosure, and a double recovery for the lender. Thereby minimizing the possibility a lender would even consider working with a homeowner in distress since they could foreclose the property quickly for pennies on the dollar and pursue the deficiency from a judgement easily obtained. CHECK BACK FOR MORE!

SB-1271 Anti-Deficiency Statute

The anti-deficiency bill SB-1271 that passed Arizona legislation is receiving some heat. The original intention was to prevent investors in Arizona from foreclosing and short selling homes and sticking the local Arizona lenders with out any method of recovering the funds and thus making those banks go belly up. The major change was the requirement that the borrower had lived in the property for six consecutive months. Stick with us as we cover this topic over the next couple days.

Is Mandatory Title Insurance too Costly?

Read the following article about title insurance in the Wall Street Journal written by James R. Hagerty http://online.wsj.com/article/SB10001424052970203739404574292542488539828.html. One of the reasons a real estate agent or builder may recommend or "prefer" to use a specific title agent is the same reason many buyer's and seller's choose to use the same real estate agent. Usually they have provided good service in the past and they have a familiarity and working history. Some title agents are better than others in service, and response. Many times a title agent assists in a real estate transaction by working with all parties to a negotiation in an unbiased fashion. In the event of some sales, a title agent may used throughout the process to prepare net sheets for a seller or a HUD-1 that may need to be presented to a bank for approval.

Arizona Real Estate Market Improving

According to the Arizona Regional Mulitple Listing System (ARMLS) statistics, there were 39,672 active listings in June, down from 57,362 of June '08. Also, slaes in June '08 were 5,673 compared to 9,310 June of this year. Another comparison is 10.21% of active homes sold in June '08 and 23.47% of active homes sold this June! That is an eye opening statistic.

Average days on market (DOM) for active listings has kept relatively consistent over the past 10 months adusting up and down monthly between 77 and 88. The average sales price had a steady decline from July '07 ($343,412) through March '09 to a low of ($158,809) and has increased each month through June '09 currenlty ($171,423).