Real Estate Marketing - What is a Short Sale and How to Negotiate to Stop Foreclosure? - Part 7

http://realestatemarketingthisweek.com - Real Estate Marketing - Prices are back to 2003 levels: A Short Sale is significantly cheaper for a bank than a foreclosure -
Produced by Dan Havey of Real Estate Marketing This Week

Part 7 - Were in the studio today with Kalyn Roberts and Jeri League of the Dreamvesting Group, these two young ladies are experts in the short sale area, they are NOT going to tell you what you want to hear, they are going to tell you what you need to hear. There is a big difference between what you want and what you need in the case of getting out of a situation. We talked during the break about the different types of people; who qualifies, who doesn't qualify, who this is good for, and who its not good for. I want you to talk about people who are upside down and how you're here to help.

What we want to get across today if you just need to call someone if you're upside down in your mortgage, if you have a listing next door and its a bank owned or short sale, there is a good chance you're probably upside down in you mortgage if you bought anytime in the last, in the last 5 years were almost back to 2003 pricing now.

Just to jump in real quick, Jeri and Kalyn its not just the people who purchased, its the people who used their homes as ATMs which is a crude way for me to say it but lets be honest. You watch the television, and I am not going to name any names, but a company that rhymes with lie-tech though, they have a commercial where they are showing pictures of using your home to buy a big boat and everybody got sucked into that and now here were.

Yes, if you used your second mortgage to build that big beautiful pool in your backyard, maybe you need to call us. Yes, its unfortunate, we always tell everyone like you just said, everybody got sucked into it, it doesn't mean you're stupid, it doesn't mean you necessarily made a really bad decision. Most people got caught up in the real estate market and good marketing ploys like that, and the bottom line is as we said earlier you dont have to be late on your mortgage payment, you don't have to be facing a foreclosure, if you're simply upside down because you refinanced your home or purchased too recently and the house next door is selling for $100,000 less than yours and you just need to get out of a bad financial situation, you're a candidate for a short sale or even a loan modification.

One of the things about loan modifications that I hear all the time is, and I research other loan modification companies, and what I hear is they are telling people things that just aren't real. For instance if your owe $400,000 and your house is worth $300,000 and you want your lender to forgive $100,000 on a loan modification, chances are that isnt going to happen, whereas with a short sale, when youre exiting the property because it just isnt going to work, they would in most cases consider doing that.

Absolutely if that is the market value of your home they are going to consider the bottom line, the banks dont want these properties back, it costs them so much money to go through a foreclosure process and as our prices are falling, monthly, weekly, daily, the likelihood of the value of the property being extremely lower by the time they get the property back is 100%.

In addition to the $60,000 in foreclosure cost, paying real estate commissions and a few other fees is significantly better, because the loss is going to be significantly less with a short sale. Heres a question and I hope that I am not putting either of you on the spot, but suppose the guy owes $400,000 on his house, lets just say its worth $300,000 and you get the listing and this guy is out at a cocktail party and his cousin shows up and says, Ill buy the house from you. Ill buy the house from you, we will make the bank pay the difference and Ill just let you stay in the house. Is that a realistic situation, is someone going to find out about it? Is it good to do that or not?

In real estate, real estate purchases and transactions have to be non-arms length. Now arms length is described as your parents and your children, other than that we pretty much stay out of it because theoretically, yes that could happen, however the banks want to see that the homeowner is not benefiting, so the homeowner would have to become a tenant and be paying rent to new owner at that point. So there are many legitimate situations where you could meet someone who would buy the home and allow you to stay in the home... http://realestatemarketingthisweek.com/a-short-sale-is-significantly-cheaper-...

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[Shockofsanta]

@ 3:45 "the banks do not want the house back" OH HOW WRONG YOU ARE! If you "owe" less than what they can resale it for they will try to screw you and foreclose. Plus, they dont even own the freaking house, they sold it, then it got sliced diced and sold again. Ask a bank to prove they own the house your paying them for. THEY CANT!

[REMarketingThisWeek]

@Shockofsanta - In the event of a foreclosure sale/auction, if the bank receives a higher bid than what is owed on the home, the excess funds go to the home owner. If the bank sells the house after taking back the property (meaning no bids at the sale/auction) then they can sell the home for whatever the market will bear. You are right, the bank does not own the house. The homeowner owns the house. The bank owns the debt against the house which they may have sold an interest in.

[Shockofsanta]

@REMarketingThisWeek

Technically, I would say the Gov. owns the house first whether its paid off or not. Taxes taxes, you no pay ever and ever increasing tax - lose house.

Its in a banks best interest to foreclose, even at a monetary loss, so as to bury their fraud. Once someone is foreclosed on and broke they're unlikely to pursue the matter any further.

This issue, the fraud behind the housing boom bust and all of that, in my opinion, amounts to treason.

[REMarketingThisWeek]

@Shockofsanta - I agree that there are many in the Congress who are responsible for the boom and then the crash, as well as the big banks and the rating agencies. We just need to keep moving in the direction of smaller government and less taxes, which adds up to more freedom for all - the freedom that our founders had intended for us.

[Shockofsanta]

@REMarketingThisWeek

I would think a strict adhehence to the Constitution would suffice. We need to move in the direction of prosecuting those who betrayed it, and we shouldnt further count on the Judicial branch to enforce the Constitution as it has proved lame(corrupt?) as fuck.

[REMarketingThisWeek]

@Shockofsanta - I'm not in favor of any extra-constitutional actions, just vote out the bad ones, approve a Balances Budget Amendment and appoint only strict-constructionists to the bench.

[principles101]

If the loan has MI (Mortgage Insurance) on it, good luck trying to get an approval to short sale it. Now, they can double dip!

[Shockofsanta]

@REMarketingThisWeek

LOL! A balanced budget law! We already have one, its called the debt ceiling limit! Ha ha ha.

The Constitution authorizes congress to enter into debt, but it also says "no state shall make anything but gold and silver coin a tender in payment of debt."

The debt debate is irrelevant because at its foundation the fiat debt "federal reserve" is unconstitutional.

Thanks for the conversation.

[REMarketingThisWeek]

@alexnds1 - Its MERS (Mortgage Electronic Registration System). The 'produce the note' defense has been used successfully in some states

[alexnds1]

The banks got the loan under something called the "MARS" system. That means, the loan was packaged and resold on the secondary market as a collection of pooled money notes. The notes are the key to the lien. If they can't prove they have the lien, they can prove they gave the money, but if they can't prove the lien, that means they don't have collateral behind the loan. Therefore, they can't foreclose. Make your attorney DEMAND THEY HAVE THE LIEN AS PROOF