United We Stand - Divided We're Falling.
Since 2008, Sonoma County
homeowners have lost 6466 homes to a short sale or foreclosure. That's
135% of our average annual home sales. Year-to-date, our market is
tracking at almost 50% bank sellers, with each foreclosure or short sale
representing another family losing their home.
More is coming. In 2011, thousands more loans, Option Arms and Alt-As,
will reset their interest rates and terms. These loan types were often
used for higher priced properties. So next year, thousands more owners
with higher-priced homes, some already upside-down, may be facing short
sale or foreclosure.
Our market has already experienced one devastating collapse. Another
collapse of even higher-priced properties will further weaken our real
estate market, dash our confidence, depress our business climate, and
sour our future.
United We Can Stand: We can stop this coming collapse, but solutions
must be presented and voices must be heard. Here are Two Quick Fixes and
a Permanent Solution we must fight for.
Two Quick Fixes: with the right motivation, these Two Arbitrary Lender Rules can be reversed or suspended. Motivation is up to us.
1. Arm's Length Transaction: this Rule says the Lender can short sell a
property to almost anyone except the Owners or their Family. What unfair
nonsense. The exact opposite should happen since the Owners typically
want to keep the home and will pay the most for it, if still employed.
2. Home Loan Qualification Rule: this Rule requires Buyers to wait three
years for another mortgage if they went through a foreclosure or short
sale. This SHRINKS THE BUYER POOL. Since 2008, Sonoma County LOST 6466
BUYERS. That's 16 months worth of home sales. We need more Buyers now,
as more demand will raise prices and help stave off equity collapse if
the banks decide to again flood our inventory with foreclosures.
This win-win solution does not require new money or government credits.
Owners keep their homes, Banks keep their cash reserves, Debt Holders
get more income, the real estate market returns to normal, AND as
confidence grows, businesses will begin hiring. Now this is definitely
worth joining together to fight for.
1. Short Sell to Owners/Family Members - restructure the Original Debt:
a) write a new mortgage at 100% of market value, 4.5% interest, 30 year
fixed. b) lien the Leftover Debt Balance against the home, no payments
due. c) the Debt Holder & Bank will write off the Debt Lien over 10
years. If the property sells within 10 years, equity gain is split
between the Property Owners and the Debt Holders.
2. Bank Cash Reserves - allow Banks to use the Original Debt Amount
(including second mortgages) for cash reserves, writing off the Debt
Lien over 10 years. This relieves cash reserve stress and provides
market certainty. This also stops increasing the foreclosure inventory
bring more stability to bank books and the market place.
3. Debt Holders - will receive income immediately on defaulted loans
instead of nothing for years. Losses are reduced without foreclosure
costs and further reduced with gains from properties sold.
4. Stabilize Real Estate - this solution stops the feared flood of short
sales and foreclosures that will, once again, drive down prices. In
Sonoma County, homes available for sale would drop 41%, raising prices,
rebuilding lost equity, leading the real estate market back to normal.
5. JOB CREATION - a stabilized home market will build confidence,
improve our business climate, motivate job creation, and set the stage
for economic expansion. Just think what percentage of lost jobs were in
construction and building...this solution would get that industry back
on its feet.
With One Voice we can Save Our Homes.
Register now to help save your home