Jana Lane's Blog

Some timely and important information! Click the images for details.

This is a great tool for home buyers who would like to search the MLS in a private, password-protected site of their own -- rather than a public MLS search engine. 

Realtors and prospective buyers - check it out!

Only watch this if you want to feel better! Courtesy of Think Big Work Small. 

(Click on video to watch)

A short sale is when a home is sold for less than the amount owed on the mortgage for the home. This occurs when the bank agrees to take less than the full amount due on the mortgage.

A seller does not have to be behind on a home loan to seek a short sale. If sellers wish to pursue a short sale, they must owe more than what the home is worth, demonstrate the house cannot be sold for the amount owed, and suffer from a legitimate financial hardship that makes the mortgage unaffordable.

The next step in the short sale process is to assemble a short sale package. This package will include such things as a financial statement showing monthly expenses, income documentation, bank statements, tax returns, a listing agreement, purchase agreement, an estimated HUD statement and a financial hardship letter.

If the home is sold as part of a short sale, there will be a difference between the amount owed and what the bank collects. This is called the shortage or the deficiency. Sometimes this deficiency may be negotiable. Some banks will seek a promissory note for the deficiency, meaning that the seller may be responsible to pay the difference between what the home sold for and what is owed to the lender. Some lenders might choose to file a collection or a judgment for the amount owed. The seller should be certain that any amount of debt, or release from debt, is received in writing. If the deficiency is forgiven, the lender can write off the shortage with the IRS, which means the seller may be responsible for paying taxes on the amount of the deficiency. However, the Mortgage Debt Relief Act of 2007 generally allows taxpayers the potential for relief from tax on mortgage debt forgiveness.

A short sale will affect the seller’s credit score. To minimize the effect on a credit score, sellers should avoid making late payments on their mortgage and work with the bank to report the sale in the best possible manner.

Courtesy of Prospect Mortgage.

(Click image for enlarged view)

Good News – Rates ended the day better after breaking through the 30 day moving average (shown above – yes, up is good in this case). Here’s a peek into one of the daily updates that I receive as a Mortgage Coach member – it’s a quick read and eliminates a lot of the fluff that is out there.  I’m happy to answer any questions. -Jana

Via RateWatch.com: Mortgage and long-term Treasury rates are falling suddenly today, as the SEC’s fraud charge against Goldman Sachs is tanking the stock market.
     
Couldn’t happen to a nicer bunch of people. The 10-year T-note has broken below recent 3.80% resistance to 3.77%, mortgages headed toward 5.00%.
     
Interpreting new economic data is trickier than ever, even for professionals, as an odd confluence has tipped public sources into uniform economic cheerleading. The whole country would like not to hear another word about recession, and is hungry for news of recovery. Media tend to supply whatever it takes to sell soap.

CNBC years ago dispensed with real news. Bloomberg television was a reliable replacement, but this winter cloned CNBC’s grinning kids in happy talk (its web-based news is still as straight as anything available). The WSJ under Murdock is dumbing-down to the USAToday of business. It does have the old, reliable hostility to real estate and government, but its stock-boosting leads to a parade of “strong-recovery” stories. The New York Times has been the counterweight, but now it has a President that it likes, and pushes administration success and recovery.
     
Meanwhile, the economy is in a cycle never seen before, parts in actual recovery, parts not, and which one is predominant and trend-setting should preface every story.
     
The legitimate good news this week: March retail sales jumped 1.6%. If only by means of stimulus doesn’t matter -- the deficit spending and big tax refunds are supposed to work. Industrial production crept upward .1%, but capacity in use has been in a steady climb to 73.2%, as has every measure of manufacturing. Some of that is just pipeline-filling, but some is honest exporting, as the emerging world and Asia continue to rocket and consume. China’s GDP shot up 11.7% in Q1.
    
That’s it for the good news. Careful readers saw mini-stories about another jump in unemployment claims, up 45,000 in two weeks. Harder to find: a sudden sharp drop in purchase mortgage applications, just when the expiring tax credit (and that recovery thing) was supposed to boost them. The major dailies dutifully reported the chasm between administration housing policy and result, but with far too much deference.
    
I could not find the following news in any outlet listed above. The National Federation of Independent Business has been the definitive small-business trade group and surveyed its members since 1973. It issued two reports this month: its regular survey opened, “The persistence of Index readings below 90 is unprecedented... 18 consecutive months.” Every sub-index chart shows a recession-level “L” tipping to weaker. The top small-business problem is basic: sales volume is awful.
     
The second report at www.nfib.com is a special study on small-business credit, and Perfesser Bernanke’s testimony revealed the Fed had assisted its preparation (no leading outlet gave priority either to the study or the Fed’s involvement). The title  revealed most of the 45-page content: “Small Business Credit In A Deep Recession.” The report detailed a crucial linkage -- and surprise to the NFIB itself -- small business is terribly reliant on real estate credit, and that is in the shortest supply of all.
     
Perfesser Bernanke gets it, now. Fed commentary has been stuck on the banker line, that credit is short because applicants are lousy, but the Chairman’s testimony changed: “Banks have been... imposing tough lending standards and terms; this caution reflects bankers’ concerns about the economic outlook and uncertainty about their own future losses and capital positions.” Thank you, sir. Better late than never.
     
Jamie Dimon preened at Chase’s 55% pop in Q1 earnings, and noted the splendid health of big business. He doesn’t know any small business people. Probably wouldn’t want his daughter to marry one. The fine print in his quarterly result: three-quarters of the $3.3 billion net income was from trading profits, not from lending, and new bad-debt chargeoffs continued their $7 billion-per-quarter pace.”

by: Lou Barnes, Mortgage Coach