As a matter of factual history, most rent-to-own deals never go through. This means the buyers lose the non-refundable "option fee" that they paid each month that was supposed to be applied to their down payment.
Buyers often hope to use a rent-to-own option to lock in the price at current levels until the final option date, but most brokers usually include an escalation clause to protect the seller in the event that the market takes off during the option period.
Unless there is a unique reason for buying in this way, it's usually better to do an outright purchase or save your money elsewhere until you are ready to buy.... more
If you stop making payments, the bank can start foreclosure proceedings with as little as 3 missed payments. There are requirements for a short sale. The main condition is being in a hardship position. There are other factors as well. Talk to your bank and see if anything can be worked out.... more
The first question B of A is going to ask "what is your hardship" and then they will ask for a list of assets and liabilities. The banks I have worked with want to see NO assts of any type, including using up your cash and credit lines before they see a "hardship" Iy depends in how much cash you have vs. the total debt you owe.
David Cooper. Las Vegas Foreclosure Investor in Bank Owned Houses with huge Cash Flow. Call for FReee
list. +1-7024997037 not a real estate agent.... more
You need to start evaluating your situation and see what makes sense. If you you let them foreclose it will happen in maxium 120 days from your the start of the foreclosure. This will hurt your credit rating and most likely limit your ablity to purchase another home for 5 years or more, depending on how the underwriting standards get adjusted. If you complete a short sale you may be able to get a new house in as little as 2 years depending how the bank reports the short sale. It is best to get the house on the market and then start making your plans to see what you want to accomplish. If you get a job your options will open up!... more
Read the blog I wrote on how to find lease-options: http://bit.ly/findaleaseoption
You can find them on the MLS and privately. I agree with you: You don't need "these internet companies." Some are legit, some not. Tip: Never pay anything up front, in advance. There's plenty of money to be made (if an investor is involved) in the lease-option process itself--the option fee, the cash flow, and the purchase price.
Hope that helps.... more
I know the area of Vallejo has been hit hard. I work in the San Diego Area and we have seen a large drop in home prices as well. I would recommend you speak with a lender to see if you can modify your loan. If that is something that they will not do for you, than you might want to consider short selling the home. This helps with the stress of trying to make the payment, and has a less credit impact then a foreclosure. I would find a realtor in the area that is experienced in short sales.
I hope that helps....Good Luck
Catherine Barden... more
I had a seller who bought a home in New Jersey due to job relocation. I was able to successfully close his home as a short sale here in California. Choose an experienced agent, it makes a difference.... more
That's going to be hard for any of us here to guess at not knowing anything else. It likely will need plugging to aerate, might need lime to sweeten the soil, and will surely need new seed and fertilizer. It could be as little as $100-200 or $700+ depending on the work needed and the size.... more
My feeling is that housing prices will reflect what is going on with the city and the finances. (It certainly does not help!) Call a city council member and asks how city services are being covered. Ask what is being done to correct the situation.... more
When a seller can no longer afford to pay their mortgage, then their mortgage holder may do a short sale. A short sale is when the mortgage company is willing to take less than the seller owes. The bank orders a Broker Price Opinion or Appraisal and once they get a probable foreclosed selling price, then they determine what price they willing to sell the property for. They will not do any of this though until first the seller turns in paperwork showing they cannot afford the house and the process can take several months.... more
The speed at which your property sells is determined by the price at which you are willing to sell and hoe much a buyer is willing to pay. The final "value" of the property is NOT determined by; what you need; what you want; what you think; what your agent thinks; or what your neighbor thinks for example. It is decided by a willing buyer who has the $$ to buy and close the sale.
The best way to approach this situation is to interview 3 REALTORS and see what each says about the value of your home. They will provide COMPS for you which should show similar properties to yours that have sold in the past 5 months and within 1 mile of your house.
If you price it too high, you may get a very high offer, but if it doesn't appraise, you may as well not have any offer at all. It will be off the market while the appraisal is done and you could lose better / more realistic buyers.
Be carfeul, consult with a REALTOR and best of luck !
Broker / Owner & Certified HAFA Specialist
Thom Colby Properties
Newport Beach, CA
Moving Lives Forward (TM)
We NEVER DOUBLE-END a Transaction in our Brokerage. There is NO benefit to the Seller or Buyer but only benefits the Agent. NEVER use your RE Agent / Broker as your Lender!
888-391-5245 Direct Cell
DRE# 01398570... more
Homes For Sale in Hiddenbrooke CA- Market Update. Homes For Sale In Hiddenbrooke, Week Of October 11th, 2010 There was 4 new homes for sale in Hiddenbrooke CA in the last 7 days. Click Here to see
Visit a neighborhood several times and at different times of day to get a sense of belonging. Check out area statistics; real estate professionals are prohibited from steering—enticing a buyer to purchase, or not, in specific neighborhoods; so, you should check out demographics on your own to assure your comfort level can be reached.... more
Without any income information, etc.--You loan officer can best advise you-- do pay down debt, get rid of old debt, keep credit cards below 50%, dispute any negatives you may have, pay your bills on time. Do you need to have 3 cars, if not why not sell--again why not visit with any qualified loan officer(s) and see what options you may have.... more
Hi Mike, I am very sorry to hear of your situation. I'M NOT A LAWYER, nor am I aware of ALL the details of your circumstances; however, my understanding is as follows if a foreclosure takes place:
There a number of ways a lender may or may not be able to go after personal assets via a deficiency judgment after a foreclosure, but it makes a difference on how the property is foreclosed.
For a Owner-Occupied where:
1) A lender made a purchase money (non-recourse) loan, then NO deficiency judgment can be attempted. If a senior lienholder forecloses on the property, the "wiped out" junior lienholder who no longer has a secured note may not sue on this promissory note.
2) A Seller financed a purchase money loan (non-recourse), NO deficiency judgment can be attempted (non-recourse loan). If a senior lienholder forecloses on the property, the "wiped out" junior lienholder who no longer has a secured note may not sue on this promissory note
3) You as the owner of the property, refinanced the property (recourse loan), then a deficiency judgment CAN be attempted if a judicial foreclosure was used. This is NOT allowed under a trustee sale foreclosure. HOWEVER, if a senior lienholder forecloses on the property, the "wiped out" junior lienholder who no longer has a secured note MAY SUE on this promissory note.
IN ANY CASE, A REAL ESTATE LAWYER SHOULD REVIEW YOUR SITUATION!
You may also want to review questions 4 thru 6 of this document:
Once a lawyer advises you, a Short Sale may be suggested. From a credit perspective, this can be advantageous over a foreclosure. This is what I'm hearing from a credit scoring specialist who has been in the biz close to two decades: going into a short sale gives you more opportunities to minimize the affect on your score. In addition, your ability to have your score bounce back is easier with a short sale. Why?
Immediate affect –
a.) With a short sale, you may be able to keep payments current (avoiding the derogatory scoring there), and you can negotiate with the lender as to how it is reported to the bureaus. For example, if the bank reports the account paid and closed, you’re better off than if it’s reported as being settled for less than owed. That may be a bit of a long shot, but the point is you have some negotiating range.
b.) Foreclosures go on to public record, where short sales do not.
Bouncing back -
a.) Credit bureaus put short sales in a different scoring bucket than foreclosures when generating a score. The foreclosure bucket is dealt with more severely in that it takes longer to recoup the points lost by the event.
b.) Besides the scoring by the credit bureaus, lenders (read Fannie & Freddie) allow a return to the best rate pricing sooner with a short sale (2 years) than with a foreclosure (5 years)
Other Considerations -
1.) Credit scores hit in a range of 80-200 points from best case to worst case with short sales. Figure it’s closer to 200 points with a foreclosure. This is consistent with other articles I’ve seen.
2.) Beware of the Promissory Note that stays on. In some circumstances, a bank will agree to a short sale if the Seller agrees to sign an unsecured promissory note for some additional amount. This obviously would allow for the lender to recoup some of its lost money after the short sale. However, if the burden of that debt leads the Borrower into bankruptcy, then the Borrower has the worst of all worlds. That is, there is a BK as well as a foreclosure on the credit report. That’s one more public record; it lasts for 10 years, hurts score additionally, and makes it harder to bounce back.
I hope this helps! Please seek the advice of a lawyer who specializes in distressed property cases. The rules are different between Owner-Occupied and Non-Owner Occupied distressed property.
Best Regards, Steve... more
DL - You can work with anybody you choose to. Sometimes the people getting the referrals pay a fee to the organization when they assist you. If you are using special loan or down payment assistance programs it may be better to work with the agents who are familiar with the programs. Their knowledge and expertise on the programs will prove themselves invaluable once you get into contract on the home. Any agent can show you homes, make sure you feel comfortable with the agent and that they are familiar with the programs to help you buy the home.
Keller Williams Realty