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Kris And Kim Darney's Blog

By Kris And Kim Darney | Agent in Upland, CA
  • Short Sales Up 74% In Southern California…

    Posted Under: Home Selling in Los Angeles County  |  July 19, 2010 10:33 AM  |  493 views  |  No comments

    The number of transactions in which a home sells for less than the owner owes the bank is up 74% in the region this year, mainly due to a doubling of those so-called “short sales” in the Inland Empire, the Southern California Multiple Listing Service reported.

    CountyShort Sales% Change
    Orange2,91154.8%
    Riverside3,444116.2%
    San Bernardino2,08996.7%
    Los Angeles4,46255.5%
    Total12,90674.3%

    During the first five months of 2010, the four-county region had 12,906 short sales, up from 7,405 in the same period of 2009, SoCal MLS figures show.
    Short sales are increasing as lenders become more amenable to approving deals rather than letting homes go through a costly foreclosure.
    Here’s how those numbers break down in Orange, Los Angeles, Riverside and San Bernardino counties:
    Riverside County had 3,444 short sales this year, the second-highest number in the region. That’s up 116% from 2009, when the county had 1,593 short sales.

    CountyBank
    owned
    Total
    distressed
    Orange-55.6%-18.8%
    Riverside-51.5%-30.6%
    San Bernardino-42.8%-33.2%
    Los Angeles-38.3%-16.4%
    Total-46.1%-24.4%

    San Bernardino County short sales increased 96.7%, to 2,089. During the first five months of 2009, the county had 1,062 short sales.
    Los Angeles County had the most short sales: 4,462, but that’s up just 55.5% from the same period in 2009, when there were 2,870 such sales.
    Orange County had the lowest percentage gain: up 54.8% to 2,911 short sales. The same time last year, O.C. had 1,880 such sales.
    Overall, the region has 29,242 distressed sales this year so far, down 24.4% from the first five months of 2009 due mainly to declining sales of bank-owned homes.
    Bank-owned home sales fell 46.1% to 17,233 this year.

    Story by Jeff Collins

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  • Understanding HAFA

    Posted Under: Home Selling in Los Angeles  |  July 17, 2010 1:37 PM  |  202 views  |  No comments

    Home Affordable Foreclosure Alternative

    HAFA

    HAFA (Home Affordable Foreclosure Alternative) was established (April 5, 2010) to assist America’s Homeowners through these troubled times of decreasing home values and finding a “graceful exit” from a bad financial situation.

    The HAFA program allows you to sell your primary residence if you are “upside down” or in a “negative equity” position.

    What Does HAFA cost me?

    What does it do for me?

    • The HAFA program:
      • Allows you to sell your primary residence if you have no equity.
      • Allows you to sell without any penalty or commitments to repay your mortgage company the difference or “Non-Recourse“.
      • Pays you…the seller…up to $3,000.00 for moving expenses or “Cash For Keys”.
      • Pays off your 2nd liens or 3rd liens without any “Re-course” or promise to repay.

    How do I apply?

    • You must use a Licensed Real Estate Agent from your state to initiate the HAFA process
    • The process may require the following:
      • Financial Worksheet
      • Bank Statements
      • Most Recent Pay stubs or Unemployment Documentation
      • Hardship Letter of Explanation
        • Loss of employment.
        • Relocation of employment (100 miles from primary residence).
        • Death.
        • Divorce.
        • Most life altering circumstances that result in a loss or reduction of income.
    • 2 years Federal Tax Returns or Explanation

    How Long does it take?

    • The application process takes up to 10 days from the time all your Short Sale documents are submitted.
    • Once a HAFA approval is received, the sale will take  from 30 to 60 days to close, much ike a standard sale.

    How will my credit be impacted?

    • Your credit may report “Satisfied for less than agreed” ,  ”Paid less than agreed”, “Settled”, etc…
    • Your credit score is very subjective and based on your specific debt to income ratio.
      • Most credit scores are impacted between 50 and 100 points.
      • Late Mortgage Payments or Default in payments may have a greater impact.

    What if I owe back property taxes?

    • In most cases, your mortgage company will pay your late or defaulted property taxes.

    Will HAFA pay IRS or State tax liens?

    • No, however, the IRS and most states, upon notification and submission of a few documents will allow the property to be sold as long as their is no “gain” to  the seller or what is known as a Short Sale.
    • Some considerations not covered by HAFA
      • Investor owned, 2nd or vacation homes, vacant land
      • Strategic Short Sale
        • Where you simply want to sell the property to get out from underneath the debt.
    • Freddie Mac or Fannie Mae backed loans
      • These two government backed entities will have a program that mirrors HAFA but as of this date, the program has not been rolled out by either entity.

    Learn more about the HAFA program from this video:


  • Record Number Of Foreclosure Sales Cancelled Due To HAFA…Short Sales

    Posted Under: Home Selling in Los Angeles County  |  July 17, 2010 1:31 PM  |  146 views  |  No comments

    Lenders are canceling more foreclosure sales in California than ever before, and new financial and political demand for short sales could be the culprit.

    Lenders canceled nearly 22,000 California foreclosure sales in June, driven mostly by JPMorgan Chase (JPM: 40.48 +3.29%). It’s a 27% increase from May, a 153% growth from a year ago, and an all-time high, according to ForeclosureRadar, which tracks foreclosures in the state.

    Foreclosure sales can be canceled for successful loan modifications, short sales, a legal requirement, or even a filing error. In terms of strategy, a spokesperson for JPMorgan Chase said the bank has not made any policy shifts to cancel more foreclosure sales.

    According to ForeclosureRadar, a certain number of the cancellations can be attributed to pending modifications and short sales, but homeowners and real estate agents have complained to the company of sales that were canceled without either.

    “We have seen a shift over the last couple of months where homeowners want this process to be over and they want to start to rebuild,” said a spokesperson for ForeclosureRadar.

    Researchers at the company received varying answers as to why the cancellations are up. The best answer came from one unnamed REO professional. According to the source, the Home Affordable Foreclosure Alternatives (HAFA) program had the most to do with the cancellations. The Treasury Department launched HAFA in April to provide incentives to servicers for conducting short sales and deeds-in-lieu of foreclosure to homeowners who fail the Treasury’s Home Affordable Modification Program (HAMP).

    “Now that servicers have systems in place to administer the program they are removing delinquent loans from the foreclosure pipeline to allow a reasonable short sale time period,” the source told ForeclosureRadar. “Predictably (also my opinion) the period would be expiring just after the November elections so there would be less political blowback as those properties that don’t conclude with a successful short sale are taken to foreclosure and ultimately, REO.”

    After foreclosure activity dropped across the board in May, new foreclosure notices increased 6.7% in June, and notices of trustee sale jumped 21%. In fact, notices of trustee sales have outnumbered preliminary notices of default for the past four months. The gap really widened in June, when there were almost 9,000 more notices of trustee sale.

    But this trend could become the norm as banks have to restart more foreclosures than they initiate.

    “Historically it is very unusual to have more Notice of Trustee Sale filings than Notices of Default” says Sean O’Toole, founder and CEO of ForeclosureRadar. “But with skyrocketing cancellations and the possibility of failing loan modifications, this will be increasingly common, as lenders are only required to file a Notice of Trustee Sale to restart the foreclosure process.”

    Lenders pushed 23% fewer properties into REO status in June and 46% less than a year ago. The amount of properties that have received a notice of default but have not yet been scheduled for sale increased 8.8% in June, but further along the foreclosure pipline, inventory remains constricted. The amount properties scheduled for sale dropped 1%, and REO inventory declined 4.8% in June

    Thanks to Jon Prior.

  • Sell Your Home & Rent it Back

    Posted Under: Home Selling in California  |  July 17, 2010 12:33 PM  |  149 views  |  No comments

                                                      

    Kris & Kim Darney are proud to announce our “Short Sell & Rent Back” program being rolled out to Americans in need.

    We've seen far too many American  families having to make the hard choice of selling thier home due to rising payments or 2nd liens.  With this decision, these families have to seek another home, meet the landlords tight restrictions usually based on credit scores, pack up all their belongings and negotiate moving trucks and getting family members and friends to help them move. Not a very dignified solution to a bad financial situation.

    With our “Short Sell & Rent Back” system, we make it easy and pain free for you to stay in the same home.

    How does the Short Sell & Rent Back Program work?

    1. As Realtors, we list your home*
    2. We contract with one of our investors to buy your home…often sight unseen.
    3. We negotiate with your mortgage company to sell your home to our investor.
    4. The sale closes and you rent the property back.
    5. Your mortgage company pays our fees…you don’t pay any commissions.

    * It is a requirement with mortage companies that the property must be listed with a licesnsed real estate agent.

    Call Kris and Kim Darney at 714-615-7605 or visit them at their website .
  • Short Sales…Discrete, Dignified, Graceful Exit…Alternative to Foreclosure!

    Posted Under: Home Selling in Los Angeles County  |  July 17, 2010 12:13 PM  |  197 views  |  No comments

    As real estate professionals we have spent the last several years helping homeowners avoid foreclosure in this ever changing economy….

    We can finally say____Washington DC is waking up!

    The major networks and newspapers are advertising Short Sales…..could it be because……

    As of the first of the year 24% of homes in America with mortgages were underwater….negative equity.  1 in 4 homes are upside down in equity.  Simply put, if you walk outside your front door and turn either way, every 7th house=homeowner  is in default.  Better know as pre foreclosure!

    Here’s another startling fact:  80% of homes that go to foreclosure were never listed for sale!  Some of you reading this right now are facing tough choices.  Think about it, most of those 80% of homeowners never expected to loose their home.  Most likely there were factors that made them believe somehow it would work out.

    • Applied for a loan modification and found out too late that the loan modification offered did not lower the payment enough to keep the home.  *Keep in mind that during the modification process the foreclosure process does not stop.  Unfortunately, by the time the lender gets back to you about the results of the loan modification in many cases the sale date for foreclosure is pending.
    • Homeowner accepted a loan modification and was not able to maintain the agreed payments.  *Again, these lenders proceed with foreclosure process simultaneous with loan modification process.  The foreclosure process is accelerated do to this and when payment arrangements are not kept the foreclosure moves forward.
    • Homeowner entered into a forbearance agreement with lender and was not able to make just one payment.  At this time the lender does not have to notify the homeowner of foreclosure sale.  Home is sold.
    • Denial….something that most of us can identify with.  First comes the notice of default, then the trustee sale and then the sale date.  During this period of time, you have every intention of working this out, somehow, you just know you can save your home.
    • Pride….another personality trait that most of us have experienced in our lives.  The fact that for whatever valid reason you were not able to save your home, you could not face talking to someone about alternatives to a foreclosure.  *Did you know that foreclosures are public record.  Your names are posted in the local newspapers, a Short Sale is just a regular sale in the eyes of neighbors, family and friends.  You don’t even need a for sale sign on the property.  In fact, 99% of our sales never have a sign posted on the property.

    We have clients that need to sell for various reasons, some due to hardship and others making well thought out business decisions regarding their future and the negative equity they are facing if they choose to continue holding onto a property that mirrors the neighbors home that just sold for $150,000 less than they currently owe.

    If your home is upside down in equity, and you need to find out more about a short sale contact us.  We can help you by finding all of your options.

    Not only has the United States Treasury stepped in to help homeowners with a new program called HAFA, Bank of America has announced they are going to be implementing what they refer to as “Cooperative Short Sale”  this will mirror the HAFA program but have less stringent guidelines for participants.

    This is huge coming from Bank of America, as they originated one in every two loans on mortgages in America!  We have identified “like” programs with other lenders such as,  Wells Fargo, Wachovia, HOMEQ, etc…..

    You will be hearing more about Strategic Default as the days move on, many lenders are accepting of these types of sales.  Basically, homeowners who have negative equity of $70,000 or more are looking at their home much like an investor looks at their portfolio…time to cut your losses.

 
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