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Jeri Creson's Blog

By Jeri Creson | Broker in Studio City, CA
  • Red Flags when Talking to Agents about Distressed Properties...

    Posted Under: Home Selling in Los Angeles, Foreclosure in Los Angeles  |  June 19, 2013 1:08 PM  |  1,089 views  |  No comments
    My work tends to be through referrals - I really don't advertise - so, often, I encounter consumers after they have already experienced a negative encounter with another agent, and quite often, I'm consulting with them at this point because they have made some mistakes when it comes to hiring representation.   Sometimes those mistakes have cost, or nearly cost them their homes.   

    I decided to write this blog post because, sadly, there seem to be some recurring themes in the stories that I hear from consumers regarding their previous dealings with real estate agents who were offering to help them with their distressed property situation.   I realized that many, perhaps, most home sellers have no idea what is "supposed" to happen during a listing appointment, or what an agent should, or should not be doing at this point.   I'm hoping to shed a little light on the subject to help home sellers make better choices with their representation.  

      

    Red Flags: 

    1.  PRESSURE when talking with an agent about your foreclosure options:    When in a distressed property situation, while time is certainly of the essence, and action needs to be taken, it's vitally important to take a moment to step back, read EVERYTHING you've been asked to sign, and get more than one opinion.   If an agent pressures you into making a very sudden decision, or the ONLY option they provide is the one that gets them the biggest commission, or perhaps they indicate a need for signature and commitment urgently, even when you felt that you had plenty of time... these are dangerous signs.   RUN to speak with another agent... choose an agent with good reviews, perhaps one found on Trulia who contributes a lot of very logical, helpful and intelligent answers and posts.  Do some homework here - your financial future may depend on it.  

    2.  You are presented with contracts you don't understand, and they aren't explained, in depth.  This is a Biggie.   If I had a dollar for every time I heard "I didn't understand what I was signing"....well, you know - 
    Here's the bottom line:   An agent has a duty to sit down with you and review the documents that you are being asked to sign to ascertain whether or not you have a reasonable grasp of what you are agreeing to.   This is key.  It's required in license law.  Too many agents just plop down contracts before a potential client, rush them through the process, and run out of the door with the signatures.   Do NOT sign anything that an agent asks you to unless you have had a chance to read it, unless you understand what you are signing, and do not ever, under any circumstances, let them walk out the door without leaving you a copy of what you have signed or leave with a contract that has unfilled blanks that they are supposed to fill in later.    This is NOT normal.  This is NOT proper business procedure.   

    I cannot stress enough - when you sign a listing agreement, or a contract of any kind, you are entering into a binding legal contract that will have consequences for you.  Saying, "I didn't understand" later may not save you.  You are expected, in a court of law, to have acted reasonably, in your own interests, and not to have acted recklessly, regardless of whether or not you felt pressured.    The agent, if found to have exerted undue pressure may, or may not have consequences regarding that - but you must, must, must be first and foremost, your own best advocate in these situations.    If you are pressured to sign, and don't feel comfortable, simply say this:  "I'll review this overnight, and we'll talk tomorrow."   There are no penalties for doing this, and it's never in your best interests to sign something that you don't understand.   

    Better yet, if the agent refuses to, fails to, or doesn't seem to understand how to explain the document or how to walk you through the provisions he or she expects you to sign...walk away, and find an agent who will take the time to properly present a contract to you.  

    3.  Agents that skip steps in the listing process:  The general public doesn't necessarily know what an agent is "supposed to" do when listing a house, so I'm going to list the key items below so you can spot the difference:  Please note that these items apply in California specifically.  If you are in another state, you should consult an agent from your state for specific information.  

    •  An agent needs to present to you a form called an Agency Disclosure.  This form describes an agent/client relationship, and their duties to you under the law in different circumstances.   It is illegal for an agent to take a listing in California without first doing this. 
    •  An agent should meet you, at your property, and physically walk through the property in order to be able to represent and disclose features of your property and any visible defects that an agent, using reasonable care, should be able to spot to a potential buyer.  We use a form called the AVID or Agent's Visual Inspection Disclosure for that purpose.   "Internet Agents" who presume to list your home as a short sale without ever seeing it are doing so in violation of California law.  An assistant, or subcontractor cannot do this.  A licensed agent needs to see your home. 
    •  A listing agreement needs to be presented to you in writing, and needs to be complete, including a starting and ending date for the contract, the compensation that will be due and payable - the different options regarding signage, internet advertising, MLS inclusion all need to be considered and decided upon.   There is no, one, standard way to complete a listing contract.  You, as the seller have options that are negotiable.   You need to read this carefully, and understand what you are signing.  If this will be a short sale, you also need to have a short sale information disclosure presented to you that details the potential risks and various scenarios that you need to be aware of where short sales are concerned.  It should specify that the broker is willing to accept the compensation offered by the short sale lender as payment in full of the obligation in the listing agreement.   Often, banks will reduce the commission.   Your written agreement should make it clear that you aren't expected to make up the difference out of pocket if this happens.  
    • Seller disclosures should be completed.  These are the representations that you, as a seller, are making to potential buyers concerning the things you know about your property and are required by law to disclose.   These should be done upfront, prior to the listing being included on the MLS.   If the agent doesn't know what you are disclosing about the features of your home, and condition, how can he, or she make adequate disclosures to other agents or buyers?  These should not be rushed over.   You need to make careful disclosures and err on the side of too much information, rather than not enough.  Lawsuits happen, and sellers lose cases because a buyer feels that the seller didn't properly disclose something that they should have known about.   Your agent should emphasize this, and help you understand how to complete the disclosures properly and in a complete manner. 
    •  IMPORTANT:  Entering into a listing contract is NOT a requirement for an agent who is helping you to complete a loan modification package, or is showing you rental properties in preparation for your move out UNLESS and UNTIL you are actually ready to list your home and actively begin marketing it for sale.   I have had numerous sellers come to me and say that an agent wanted a listing agreement "just in case we need it later", or "because my company requires it" in the case of distressed homeowners who are trying to get a loan modification or are not yet ready to commit to a short sale.   This is a trick to get you to commit in advance.  You do not have to agree.   It is unwise to agree to lock your property into a listing contract with anyone until, or unless you are, at that moment, ready and willing to sell your house.
    • Before the agent leaves with a signed listing agreement, you should:  

    •   Have a copy of it, with all blanks filled in.  Your agent should also return to you a copy of any disclosures you have completed during this meeting within 24-48 hours.  These are legal representations that you are making.  You need to have a copy of what you have  disclosed.  *** Idea *** if you have a printer that will copy, or the ability to scan at your   home, suggest that you do the copies right there.  That way you can be sure that nothing gets changed or added to later with your signature on it.  Alternatively, you can ask to meet at the agent's office where copies can be made in order to execute the contract and agreements. 

    • Understand what you have agreed to, or don't let them leave with the agreement signed. 
    •  Know what to expect next: 
    • How soon will showings begin?
    • Who will be present during showings?
    • Who has access to my house? and how?
    • Will there be a sign?
    • How will my home be presented on the internet?
    • Do I have to complete other paperwork/short sale questionaires, etc.?
    • If so, what should I be prepared to provide?
    • How do I contact you, and your broker in case of an emergency or problem?
    • If I need to cancel...decide not to sell, or go into a loan modification program instead, how will this work, and will I owe any commission or costs because of that?  
    • How soon will I need to move out if we sell?  What should I be prepared to do? 
    • Am I expected to make any repairs at this time? 
    4.  Agents that ask you to sign BLANK documents, or incomplete documents

    I have seen instances where consumers were asked to complete signatures and date documents that were completely blank, in order for the agent to fill in the blanks later.  This is a BIG no-no.   While it may be much more convenient for an agent to do this - and many agents would, in fact, complete any "unknown at this time" items later with your specific consent and approval, you are leaving yourself open to unimaginable risks.   By signing blank documents, you are giving someone else the power to make representations that you can be held liable for on your behalf.   In one case, I saw an agent ask a homeowner to sign and date completely blank financial declarations which said at the bottom of the page, "I hereby declare this information to be true and correct to the best of my knowledge under penalty of perjury.".   And the client signed it anyway.   Please don't do this -   An agent - or anyone for that matter, has no business asking you to take this kind of risk for the sake of their convenience.   It's unconscionable to even ask.   

    In my own practice, I generally include, in writing, that the seller has the right to cancel this listing upon 24 hours written notice.  That's an easy exit solution.   Some agents tell me that this is unwise...that I might get burned doing this.   My response is this:  in 26 years, I have never had a single situation where a seller cancelled a listing with me, that I did not agree that it was best to let them out of, primarily because their circumstances had changed.   I don't feel the need to work with clients in a hostile environment, or to hold someone to a contract that doesn't wish to be there any longer.   Quite frankly, when you provide outstanding service, and you choose your clients to begin with (I only work with people that I feel have reasonable expectations, and that I can get along with) there is no need to cancel a listing.   Don't be afraid to ask an agent to make this guarantee to you - and to do so in writing.  

    If you feel that you have been tricked, unduly pressured, have been lied to or lured into a listing with misrepresentations, first approach the agent's broker and ask to be relieved of the listing.  In California, the form is Form COL:  Cancellation of Listing.   Be certain that you agree to the option which applies.  Understand that form.  If you agree to option 1 - you are saying that you will relieve the agent of his/her obligation to you, however you will STILL pay them a commission if you sell, lease or transfer your property in a specified time frame.   That is probably not your intention.   I would recommend, in most cases, choosing option 4 which relieves both the agent/broker of his/her obligation to represent you, and also relieves you of the obligation to pay them a commission regardless of what you do with your property.   This frees up your property so you can move on, and make a better decision next time!   If the broker will not agree to do this, you may need to seek out the advice of an attorney, or seek other remedies such as making a report to the Department of Real Estate regarding the brokerage practices.   If your property was listed on the MLS without your consent, you may also wish to contact the Association of Realtors office that governs the MLS where the agent listed the property.  

    Remember - these are Red Flags - not normal behaviors of good agents.  There are many, many excellent agents with great reputations to choose from out there.  My strong advice is to take some time, and find a great agent to work with.  Please don't leave your financial affairs to chance! 

    Good luck out there - 








  • Bank of America Loan Modifications with Principal Reductions

    Posted Under: Foreclosure in Los Angeles  |  March 29, 2012 5:53 PM  |  2,178 views  |  3 comments
    The long awaited principal reduction loan modifcations are not - I repeat - are not merely a rumor, nor a pie in the sky, it can't happen to me kind of reality.   I'm happy to say that one of my clients was amongst the first to receive a significant ($170,000) principal reduction offer on his B of A loan modification.   

    This particular client has been in loss mitigation for over two years.   He has not made a single payment in two years, until today, when he made his first trial period modification payment.   He has been turned down for B of A Modifications three times, and we were standing by, in case this modification attempt failed, ready to do a short sale.   And the letter finally came.   

    So, it would seem that the tides are turning.   The recovery process has been painfully slow, and many may say, "too little, too late" for the millions of Americans who have lost their homes already.  And those people would be right.   But we are here - how we got here is a lesson at best, but what we do going forward will determine both the length and scope of the final toll of this heinous financial crisis.   

    Today, I attended one of Bank of America's large-scale Short Sale Forums - mini-seminars currently being held across the country which outline their new short sale policies and procedures.  We were given new tools and "insider access"  for escalation of short sale issues (limited to forum participants only), and taken, step by step through the new programs, requirements and processes.   The idea is to reduce the vast majority of short sales from 3-6 months down to 30 days from application to a pre-approved price and terms agreed to by the investor so that a "normal" sale can take place from that point forward.    They have instituted some very good new policies and procedures.  The system isn't perfect, and they will, undoubtedly, continue to make tweeks and changes as they go forward, but I do have to applaud B of A for taking a leadership role in their approach to improving the short sale process.   This level of bank/agent communication...having real tools in place to handle the inevitable problems and find a path to resolution inherent in short sales has been a long time in the making, and we, as both agents and consumers are hoping to be seeing a little light at the end of the tunnel. 

    Let's all collectively hope that this new light isn't actually an oncoming train!

    Amen -

  • Mass Joinder: The New Loan Modification Scam

    Posted Under: General Area, Home Selling, Foreclosure  |  September 30, 2011 11:39 AM  |  1,945 views  |  1 comment

    Just when you think that it's safe to go back in the water....

    There's a new game in town.  Mass Joinder lawsuits.   According to the California Department of Justice, there have been 14 entities, including law firms and individual attorneys who have been accused of conspiring to defraud potentially millions of people nationwide with deceptive marketing surrounding their "mass joinder" lawsuits against major lenders. 

    When we read the stories that just get bigger and more disturbing daily about how major financial players - banks, who have abused the system and the trust of millions of borrowers, it's easy to get swept away in a sentiment..."We're Mad as Hell and We're Just Not Taking It Anymore!".... And that is precisely what these scumbag, bottom-feeding scam attorneys have been counting on.   They bet the farm on the fact that homeowners facing foreclosure - many whom have been saving a thousand to several thousands for months, even years, per month, while neither paying rent nor paying their mortgages in default, would have a loose $2000 - $5,000 of upfront fees to throw their way, in exchange for being part of a lawsuit to, supposedly, "force the hands" of the lending institutions to offer them loan modifications. 

    It sounds logical...even admirable.  And what borrower in todays market, when faced with foreclosure and ever-increasing imbalances of market values to loan amount ratios wouldn't want to be part of something that promises to, at last, make the bad guys pay and reduce their principal, and modify their loans to something reasonable? But that isn't what happened.  Instead, huge upfront fees were taken, and many lost their homes anyway - all the while feeling that these "White Knight" attorneys would be in the position to overturn the foreclosures if it did happen.   And that wasn't in the cards either.   Of course not.   The point was not really to help these homeowners.  The point was to find yet a new and original way of extorting huge upfront fees while providing no real value.   Hope for sale...Snake Oil...Call it what you wish.   The end result is the same. 

    www.makinghomeaffordable.gov is a very informative site - (and not one of these "for profit" look-alike sites).   I highly recommend that any homeowner who is looking for guidance, or perhaps a second opinion on a "save your home" scenario they have been presented with look here first, and run the scenario by a counselor on their hotline if they are unsure about proceeding. What this site, and the California Department of Justice, the National Association of Realtors, and, quite frankly, any of the legitimate watchdog agencies out there recommends is this:   If an upfront fee is asked of you in any matter regarding loan modification or foreclosure prevention - THIS IS A RED FLAG.   Scammers are notoriously good at making their products look "official", "government approved", "legitimate".   It's hard to tell, even for the pros, when you are facing a scam.   Please be careful out there.   And don't hand over your savings to a criminal.   That money is your lifeline and your chance to get back on your feet.  Don't let a greedy, unscrupulous lawyer separate you from it.    Kudos to the very honest, courageous and hardworking lawyers - many whom have been involved directly in bringing the bad guys to justice.   But those unscrupulous attorneys who are profiteering off such a tragic, and personal financial crisis as homeowners losing their homes....I'll say it again, "Shame on You!".

    For more information see:  http://articles.latimes.com/2011/sep/25/business/la-fi-lew-20110925
  • Attorneys who prey upon the foreclosure crisis - Shame on You!

    Posted Under: Market Conditions in Los Angeles, Home Selling in Los Angeles, Foreclosure in Los Angeles  |  December 16, 2010 3:51 PM  |  1,474 views  |  3 comments

    Just when I think I've heard it all about the various schemes to prey upon homeowners in foreclosure, my phone rings, and another poor soul who has been scammed by a bottom feeder reaches out, after the fact, to ask my advice.   It breaks my heart. 

    I recently spoke to a very warm, genuine man (I'll call him "John" for the sake of this story)  who has been trying to help his mother save her home.  This is a home where she got in trouble by taking out an adjustable rate loan where her payment is more than her gross income!   Their goal, like the goal of many people facing foreclosure, is to save the house - even if it means buying it back.   Our homes are so often looked at as more than real estate.  And to have one torn away from us can feel like - at first - a limb being cut off, or a piece of us being taken.  And I truly understand that.   But it is just this emotion, and way of looking at our homes that opens the door to the predators out there who know that many people are willing to go to ridiculous and illogical measures to save their homes. 

    John tells me that as soon as the house went into foreclosure, he was contacted by an attorney group who also has a real estate agent "on staff" to do short sales.   They charged him $5,000 as an upfront retainer fee to handle his short sale.   The reason he agreed to this, rather than just find a regular real estate agent, was that they told him they could arrange it so that his mother could buy the home back, and they would handle all the legal details.   

    The "buyer" is not an arms-length person, but rather a friend of the family that they knew would do this.  The attorney is aware of this.   The short sale is approved, but has been delayed because the family friend needed to work on their credit score to qualify for the loan.   This has caused the trustee sale to have to be postponed twice already, and the attorney is charging an additional $1,500 each time they have to get the bank to postpone the sale.   

    I told John, that although I don't have a crystal ball...I can see a few things in his future.   First, it's likely that the bank will very shortly run out of patience and refuse to postpone the sale, and his mother will lose the house.   This will be after, of course, an additional $1,500 to attempt to move the sale has been spent.   All in all, his mother will lose her house, and the attorney will walk away with roughly $10,000 worth of fees that are completely unnecessary and non refundable.   

    Folks - you don't need an attorney to stop a trustee sale.  A real estate agent who is a short sale specialist WILL NOT charge you money upfront to take your listing, and IF and WHEN they are paid, it will be because the shortsale went through and the bank pays their commission - not you.  There is absolutely nothing that an attorney is doing, over and above what an agent who knows how to negotiate short sales is doing to request postponement of a short sale. 

    Secondly, any real estate agent or lawyer who tells you that they can accomodate a sale where you are able to buy back the house afterward at a reduced price from your current mortgage is suggesting that you commit loan fraud.   All the major banks (possibly all the banks) at this point are requiring that you sign an "Armslength Affidavit" in which you swear, under penatly of perjury that you are selling to an unrelated person and that the seller will receive no hidden benefit, nor be buying the home back after close of escrow.   This is serious business.   Please don't think you'll get away with it.   Do you really want, a few years later, the bank to audit their files, and discover that you, once again own the property and launch a federal investigation for loan fraud against you?   Anybody who says that will never happen obviously is not aware of the lady who is doing time for violating copyright laws for doing nothing more than a few illegal downloads for her own use.   The industry made an example of her.  The same could happen to you.

    Bottom line - this was fraud.  This attorney took a retainer to handle an illegal act for a client.  An attorney can't do that!  I advised John to contact the Attorney General's office and the California State Bar.   Meanwhile, I suggested that he talk to a HUD approved counselor from the website at:
    http://portal.hud.gov/portal/page/portal/HUD/i_want_to/talk_to_a_housing_counselor

    Next we talked about something else:  Why losing your mother's house isn't the end of the world.   I know, as I said before, it's a very emotional issue.  But what I've seen with many, many clients over the past few years who have faced foreclosure and lived to tell about is this:   A fresh start is almost always a good thing if you let it be.   Our houses don't contain our memories and our pasts.  They only symbolize them.  We hold the love for our families, the Christmases we've shared, the times we've sat and cried together in our hearts and in our minds.   A house is brick and wood and mortar and stone.   It's been a good companion in many cases, and has symbolized our successes, and sometimes our failures.  But in the end, it's just a house.   And there millions of them out there.   Some might be a lot better if you'd just give them a chance.   Being a renter for a while at least isn't so bad... many people choose to do this their entire lives and prefer it that way.  In most cases, I've seen my clients move into nicer homes, in better neighborhoods as a renter than where they were living, paying a higher mortgage than the going rate of rent.  

    I'm not saying give up on loan modifications and other efforts to save you home.  Absolutely not - but, in the end,  if it comes down to the reality:  We just can't keep the house - please know that there is life after a short sale - it can be a very good option to save your credit and preserve your ability to get back into the market in just a few short years... and above all, please, please don't give in to pressure from an unscrupulous lawyer, agent or investor to do something that isn't 100% above board.   If it sounds like it might be a scam...it usually is.   If you have any doubt - BEFORE you pay the money, run the scenario by an approved HUD counselor.   And then watch the roaches scatter into the darkness when you shine the light on them!  

    Be safe out there -



  • Recent News on Banks Suspending Foreclosures

    Posted Under: Home Buying, Home Selling, Foreclosure  |  October 13, 2010 6:58 PM  |  752 views  |  No comments

    Since the news broke last week about a few of the larger lenders halting foreclosures to investigate claims of misconduct, I must have been asked this question at least 40 different times:  "So how is this moratorium on foreclosures going to effect our market?"  First, I always point out, this only affects 23 of the states where the foreclosure process is Judicial.  In California, where I practice, we are a mostly non-judicial state, and are not subject to these recent developments.   Which is not to say that there has been no hanky-panky in California...just that this particular instance of scrutiny does not apply to us. 

    I think all states will be affected, and a much-needed spotlight is now shining brightly upon all foreclosure processes.  This is a good thing - however, I would caution everyone not to get swept up in the extreme view that banks were wrong to foreclose and we now have a "free pass" to stay just a little longer in our homes without paying for them.   Very dangerous thoughts indeed.   The banks cannot be blamed for foreclosing on homes where the borrower has defaulted.  It's in the contract, and it makes no economic sense to just stand by and do nothing.  In fact, it hurts our economy for a bank to fail to take some action on a defaulted loan... it weakens our market and creates disincentive for investors to purchase asset backed securities.   It would be irresponsible to do nothing.   The real question is about making sure that the rules are followed, and borrowers are given an equal opportunity across the board to partake in the same chances for redemption, loan modification and foreclosure alternatives offered to others.  

    I'm concerned that this recent news encourages homeowners in default to relax and take a "lets see what happens" stance.   If you are in foreclosure, there can be dire consequences to failing to take a pro-active stance and actively pursue your alternatives in a timely manner.   As a Certified HAFA Short Sale Consultant, I can tell you that new rules apply to short sales, and specifically to HAFA short sales.  Under these new rules, for example, if your loan investor or guarantor is Fannie Mae, the following guidelines apply:

    Without Fannie Mae‟s written consent, a servicer must not consider or solicit a Borrower for a Fannie Mae HAFA short sale or deed-in-lieu if within 60 days of Borrower‟s request for HAFA, or a determination is made that Borrower does not qualify for HAMP, one of the following takes place:

    -A foreclosure sale is scheduled; or

    - A foreclosure proceeding could be initiated and have a reasonable probability of resulting in a foreclosure 

    In other words, Fannie Mae's new policy is to proceed to foreclosure if it can be accomplished more expediently than a HAFA short sale can take place.   This sounds harsh, and I can hear homeowners groaning and saying, "Unfair!"... And I agree - it's a cold stance - but it's important to remember, there are economic realities that affect the big picture, the over-all economy and economic recovery, as well as the individual homeowner's situation that economic policy must address. So my advice is, strongly:  take action NOW.   If you are in default, talk to a HUD counselor, or perhaps a specially trained professional with certifications in foreclosure alternatives like myself - but do something now.  If the situation proceeds to "Notice of Default" or worse yet, "Notice of Trustee Sale", under the new rules, every day that you delay lessens the chances that you will be successful in either a loan modification or HAFA short sale.   
    The days are over where delay, after delay tactic can buy you time in your home without paying a mortgage.  Yesterday's rules no longer apply.   Please don't get left out in the cold - there is help to be had - but nobody but you can reach out and ask for it.   



     
  • Foreclosure-Related Depression - getting through and thriving

    Posted Under: Foreclosure in Los Angeles  |  July 7, 2010 2:51 PM  |  1,161 views  |  2 comments
    This morning, I was having a discussion with one of my colleagues, another foreclosure specialist, and we were comparing notes and strategies for helping our clients facing foreclosure.   A Realtor wears many hats, negotiator, financial counselor, information researcher, to name a few, but increasingly we find ourselves in a very necessary position of being friend, counselor and a good listener for our many, many clients facing foreclosure.   It's much more than dollars and cents, it's much more than contracts and sales, for most of our clients, both the reality of their financial situation and the process involved is an extremely emotional journey.

    One of the practical ways that this depression manifests itself in a short-sale transaction is that the client often lacks any motivation to respond, gather documents or participate actively in their own best interests during the transaction.   Many times, we, as agents find ourselves balanced precariously between getting things done, - getting the paperwork in on time and keeping our clients on an even keel, emotionally - helping them see the benefit in staying motivated to finish the transaction.   A key indicator of depression, of any cause, is the feeling of inertia - not being able to bring one's self to get the little things done.   Gathering papers, getting something into the mail can feel like an enormous task to someone suffering with very real depression symptoms.  

    I believe that many, if not most foreclosure clients are not getting the attention and counseling that they truly need.  The loss of a home is much like a death in a sense, and it involves grieving - and calls for grief counseling.   The loss is much more, in most cases, than a financial setback.  It represents the loss of a dream, of an expectation, of a cornerstone around which one has built a life.  In my practice, I have observed that foreclosure clients tend to do better, and recover more quickly when they acknowledge, accept and allow for their grief over the loss of their dream.   Only then can the seeds of hope begin to spring up, closure can be achieved and new doors can be opened.  

    Agent to agent, I would recommend that we slow down with our clients, and take the time to really hear what is going on personally, and help connect our clients to the resources they need to heal and regain control of their financial futures.   As my colleague and I were discussing, we both feel that if there can be a silver lining to the dark cloud of this market crash, it would be this: that it appears that those agents who have, and who continue to survive...produce, and thrive in this market have overwhelmingly learned how to incorporate the personal touch - how to connect - or reconnect to our client base in a very human and meaningful way.   This is a very good thing, and something that was sorely needed over the past decade in real estate. 

    As a word of encouragement to any readers out there who may be facing foreclosure, please know that you are not alone.  There is a very solid, justified basis for feelings of depression and frustration.  I encourage you to talk with someone trained in grief counseling, whether it is your minister, a counselor...or perhaps a compassionate Realtor who is willing to listen.   Once we accept our situation, and recognize it for what it is, we can begin to limit it's power over us to control or limit our future.   There is life after foreclosure - and it's as good as you are willing to allow it to be.  

    At the risk of too much personal exposure, I'd like to offer a poem I wrote when I was personally facing a sad time, had to close a door, and open another... I hope you enjoy it:

    Open Door

    Post-mortem 'neath the hardened crust
    where dreams before have turned to dust
    in silent whispers turned to stone
    the road behind me turns, alone.

    A longing heart where lingers fall
    has closed it's pages, back to all
    The die is thrown, the mold is cast
    what was, shall never be...at last.

    So turning now, I come to life
    and leave behind a world of strife
    I shall tarry never more
    to peek behind that bolted door

    Instead, my steps, they shall be light
    like dawn's embrace of leaving night
    as softly as the morning dew
    for days ahead, they are so few

    I must taste this moment's bliss
    the subtle pleasures in a kiss
    the awesome raging of the sea
    the quiet growing of a tree

    I must run as swift as night
    and like the sparrow, take to flight
    for I must love as never before
    As now I stalk the Open Door.
  • California Mortgage Debt Relief PASSES!

    Posted Under: Foreclosure in California  |  April 13, 2010 9:25 AM  |  508 views  |  1 comment
    Breaking News!   Here is the text of the California Franchise Tax board's update published just minutes ago - a real breakthrough for Californian's who have experienced foreclosure in 2009, or are facing foreclosure now.   Please note instructions given in this bulletin for those who have already filed their taxes for 2009.

    Date:

    April 13, 2010

    Subject:

    California Enacts Mortgage Sacramento –A new state law allows taxpayers to immediately exclude from their income the amount of mortgage debt on their home loan that has been forgiven by their lender. The law largely brings federal law. Previously, California conformed to federal debt relief only for 2007 and 2008, according to the  

    “California has been particularly hard hit by the State Controller and FTB Chair John Chiang. “This is a critical tax change that will help people in our state who already are suffering the loss of their homes.”
     
    The new law, SB 401 (Wolk), allows most taxpayers to exclude canceled mortgage debt income of up to $500,000 on their principal residence. The limit is $250,000 for married/registered domestic partner (RDP) individuals filing separately. It applies to debt forgiveness in 2009 through 2012 resulting from a foreclosure, “ 
    Prior to the law’s passage, these amounts were taxable to California. If you owe a debt to someone else and they cancel or forgive that debt, the canceled amount often is taxable. These amounts are generally reported on a 1099-C and are provided to both the taxpayer and the government. Debt forgiveness on other types of debt, such as a second home or business property, does not qualify for exclusion under the new law.
     
    The law largely brings California into conformity with the federal Mortgage Forgiveness Debt Relief Act for discharges that occurred in tax years 2007 through 2012.  However, California’s limits of qualifying principal residence indebtedness differ from federal limits.   
     
    Qualifying taxpayers who have already filed their 2009 tax returns should file Form 540X, Amended Individual Income Tax Return, to subtract the amount of debt relief from income. To expedite processing, write “Mortgage Debt Relief” in red across the top of the amended tax return. Taxpayers must attach a copy of their federal return, including Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment), with their state tax return.
     
    Like federal law, the new state law allows individuals and businesses to exempt energy grants that are provided in lieu of federal energy credits from their gross income and alternative minimum taxable income.  It also conforms California law to many other federal provisions.
     
    According to FTB estimates, approximately 100,000 people may benefit from mortgage debt relief for tax years 2009-2012. For more information, taxpayers are urged to visit FTB’s website at www.ftb.ca.gov.
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