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Metrowest Real Estate News & Views

Building Lasting Relationships Through Real Estate

By Bill Gassett | Agent in Hopkinton, MA
  • Short Sale vs Foreclosure Credit Score Impacts

    Posted Under: Financing, Foreclosure, Credit Score  |  October 11, 2011 12:35 PM  |  1,109 views  |  No comments

    Original article source: Credit Score short sale vs foreclosure

    Short sale vs foreclosureIt is probably safe to assume that most consumers like to work with folks they know can be trusted. In Real Estate, like some other businesses there are those that can always be counted on for delivering great advice and others that only care about their own pocket book.

    I always tell people some of the best Real Estate agents are those that don’t NEED to make a sale! It makes perfect sense because an agent that NEEDS business is far more likely to tell a buyer or seller something they want to hear rather than the truth.

    Short sales unfortunately are a specialized Real Estate transaction where information is often times bandied about with no basis of fact. Many Realtors blindly go around telling people in financial distress that a short sale is better for their financial future because their credit score will not be impacted like going through a foreclosure.

    Folks this could not be further from the truth! While there are certainly advantages of pursuing a short sale vs foreclosure, credit scoring is NOT one of them. There will be plenty of Realtors that will read this and argue with me telling me I am wrong. To continue reading see short sale vs foreclosure credit score impact.

  • Fixing Finances After Completing a Short Sale

    Posted Under: Home Buying, Foreclosure, Credit Score  |  August 15, 2011 7:50 AM  |  794 views  |  No comments

    Original article source: Massachusetts Real Estate Blog

    There are not many things that can negatively impact your credit score more than a foreclosure or short sale. In fact one of the more common untruths you will hear from many Realtors is that short sales don’t impact your credit scores like foreclosures do. This is absolutely WRONG!

    If you fail to pay your mortgage during a short sale the credit score impact will be nearly identical to a foreclosure according to My FICO the governing body for credit scoring.

    Being a Realtor myself for the last twenty five years it does not surprise me when I hear this misinformation being spewed in person or around the internet.  Some Real Estate agents will paint a short sale as your ticket to the promised land and a foreclosure as a ticket to financial misery for the rest of your life.

    They do this of course because they want you to list the property with them as a short sale. A true Real Estate professional should be going over all possible financial options with you and not just looking to put money in their wallet.

    There are of course advantages to doing a short sale but a better credit score is not one of them unless you are able to complete a short sale without missing mortgage payments. The sad truth is that most but not all of the time a lender is not going to grant short sale approval unless you are behind in your mortgage payments. From a lender’s perspective if you are able to continue paying your mortgage why should they grant you a short sale?

    The advantages of a short sale vs a foreclosure center around the time you will be able to purchase a home again in the future. You will be able to buy a home after completing a short sale much quicker than a foreclosure.

    For a complete breakdown of how quickly you can get financing after both of these events see getting a mortgage after short sale or foreclosure. If you can show extenuating circumstances of why you had to do a short sale or lost your home to foreclosure you may be able to get a loan sooner. Some of the acceptable hardships that could factor into a lenders decision are divorce, loss of a job and unexpected medical expenses.

    To continue reading see Fixing finances after short sale.

  • Reasons Why Short Sales Fail To Close

    Posted Under: Home Buying, Home Selling, Foreclosure  |  May 10, 2011 4:33 AM  |  590 views  |  2 comments

    Original article source: Massachusetts Real Estate Blog

    One of the grossly misunderstood topics in Real Estate is the short sale transaction. There are a large number of Realtors who unfortunately do not possess the knowledge to properly educate their clients on what should be expected of them when trying to make a short sale purchase.

    The problem is further exacerbated because there are an inordinate amount of Realtors who are now listing short sales who have no business doing so!

    Having poor seller representation in a short sale is far worse than a traditional sale because the home owner is relying on this person to help them navigate out of a financially difficult time.  Without a short sale approval the most likely outcome is a foreclosure which is the very thing a seller was trying to avoid by going the short sale route.

    As the volume of short sales has grown so has the amount of Realtors who are looking to cash in. Money all too often gets in the way of sound decision making.

    The code of ethics in Real Estate clearly states that you should not get involved in a type of Real Estate transaction in which you have no expertise.

    This is the reason why there will be short sale lawsuits against Realtors! When I am representing a seller in a short sale and receive an offer from a buyer’s agent, most of the time the offer will have significant changes that need to be made in order to protect the seller’s interest.

    To continue reading and see 8 reasons why you will more than likely NOT be buying one of my clients short sales unless your offer is modified visit reasons short sales fail to close.

  • Credit Impact After a Short Sale and Foreclosure

    Posted Under: Home Buying, Financing, Foreclosure  |  March 21, 2011 12:07 PM  |  276 views  |  No comments
    Original article source: Massachusetts Real Estate Blog

    As a Realtor who has been heavily involved closing Massachusetts short sales over the last five years, one of the questions that I get asked quite often from home sellers is how long will it take before I will be able to buy a home again.

    The answer to this question does not have any clear cut and dry answer. There are quite a few variables involved when trying to figure out when someone will be able to purchase a home after a foreclosure or short sale.

    Going through either a short sale or a foreclosure has the potential to seriously impact ones credit.  Government entities Fannie Mae, Freddie Mac and FHA do not directly loan money to individuals but are the governing body that work with lenders to guarantee loans and free up money to provide mortgages.

    Banks typically have the authority to lend to whoever they want but will generally follow the guidelines set forth by these entities. There are some lenders of course that will take greater risks with some borrowers than others.

    Below are the general guidelines that FHA, Fannie Mae and Freddie Mac follow when considering a loan after a short sale or foreclosure:

    See Buying a home after short sale or foreclosure for a complete understanding of how your credit will be impacted as well as the time period before a borrower will be able to get financing to purchase another home.

  • Interviewing a Short Sale Realtor

    Posted Under: Home Buying, Home Selling, Foreclosure  |  February 17, 2011 11:41 AM  |  626 views  |  No comments

    Original source: Massachusetts Real Estate Blog

    As a Realtor who has been successfully completing short sales over the last four years I get to see quite a bit of the inner workings of a short sale transaction.

    In many of the articles I have written about short sales, I have expounded on how important it is for a seller to have a Realtor representing them that understands the process completely.

    From a buyers perspective it is pretty easy to understand the frustrations of some short sale transactions most notably the extra time it usually takes to get one approved compared to a traditional sale.

    The short sale completion time often is due to the particular lender involved and the complexity of the short sale. Things like the number of lien holders, liens against the property and private mortgage insurance can all be factors in whether a short sale will take extra time.

    When a Realtor is the cause of a short sale not being approved there is no excuse! In fact this is why there will be short sale lawsuits against Realtors who are clueless.

    I want to share my story from a buyer’s perspective on a short sale that I was interested in purchasing for myself and how things have unfolded over the last few weeks.

    Unfortunately, I ran into an agent that doesn’t understand short sales! Believe me I would love to broadcast who this agent is just so anyone thinking of short selling their property would never consider using them.

    In all likelihood this agent will be the direct cause of why this owner gets foreclosed on. It is a short sale botch job beyond belief. To continue reading see Short sale Realtor Mistakes.

  • Lenders Choosing to Foreclose Instead of Short Sale

    Posted Under: Home Buying, Home Selling, Foreclosure  |  February 7, 2011 7:55 AM  |  636 views  |  No comments

    Original article source: Massachusetts Real Estate Blog

    As a Massachusetts Realtor who deals with short sale transactions on a daily basis, I have seen and learned quite a bit since I started getting involved with these types of transactions four years ago.

    One thing that I am extremely proud of is the fact that every short sale that I have listed has received short sale approval from the lender. This is no small feat, as nationally the success rate for completing a successful short sale in less than 30%.

    I certainly can not take all the credit as the attorney I work with does all of the grunt work with the lender. The short sale law firm I use does outstanding work. My job in a short sale is the same as with any home I am marketing….get it SOLD! This means finding a buyer who will pay something in the ball park of market value and be willing to wait the time it takes to get short sale approval which is typically longer than a regular transaction.

    Of course part of getting a short sale to the closing table is knowing how to follow proper procedures. The are plenty of Realtors getting involved with short sales who are completely clueless but see it as a money making opportunity and are willing to put a seller’s financial future at risk for their own potential gain.

    To continue reading see Lenders foreclose instead of short sale approval
  • Avoid Low Ball Short Sale Offers When Short Selling A Home

    Posted Under: Home Buying, Home Selling, Foreclosure  |  January 10, 2011 9:33 AM  |  662 views  |  No comments
    Original Article Source: Massachusetts Real Estate Blog

    There is no question that short sales are like the wild West. Almost every single sale is different. Each lender and even the investors that hold the loan may have different procedures on how they want things done.

    There are some folks that believe that because a home is a short sale it is an automatic invitation to make an unrealistic low ball offer. Even some Realtors who have not been educated on the dynamics of a short sale believe they are just like a bank owned property.

    Part of the problem could be late night television where you see so called Real Estate guru’s telling you how to buy and sell Real Estate to become an instant millionaire. Fat chance!

    The kind of garbage spewed on these late night shows could not be the further thing from the truth. While Short sales and REO’s are both considered distressed properties they are nothing alike.

    If you are short selling your Massachusetts home this becomes a very important point.  There is a strong likelihood that you will may receive an offer that should not be accepted.

    The problem with a lot of short sale transactions is that Realtors are jumping in and representing sellers with no knowledge of the process. If the Realtor you have hired does not know how to guide you properly how can you expect to have any success?

    If you are a Massachusetts home owner who is short selling a home what you really need to understand is that the lender is going to send a representative out to your home after it has gone under contract to do an appraisal or broker price opinion. The lender is doing this to find out what the fair market value is for the property. If the offer that you have accepted is not within the ball park of the actual value of the property your short sale is going to be REJECTED!

    To continue reading see short sale low ball offers.

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