Tag Archives: short sale expert

New guidelines should streamline short sales

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Area brokers and real estate agents will tell you that more short sales – an 11th-hour effort for homeowners to avoid foreclosure – are being executed this year.

The strategy in the past had been mired by communication breakdowns, prompting many a would-be buyer and Realtor to bemoan there is nothing “short” about a short sale.

So this week’s announcement by the Federal Housing Finance Agency directing Fannie Mae and Freddie Mac to streamline the short-sale process can only help.

The efforts will come in stages, with the first phase taking place in June.

Among the new guidelines is that mortgage servicers review and respond to requests for short sales within 30 days from receipt of a short-sale offer.

Slow responses from lenders, poor communication with a lender rep, and repeated requests for documentation were common gripes cited by agents in a California Association of Realtors’ survey of short sales released last year.

Other things servicers have been ordered to do under the new guidelines are provide weekly updates to the borrower if the short sale offer is still under review after 30 days; and make and communicate final decisions to the borrower within 60 days of receipt of the offer.

The new streamline rules would also apply for deeds-in-lieu and deeds-for-lease.

 

 

 

Source: David Benda’s Blog http://blogs.redding.com/dbenda/archives/2012/04/new-guidelines.html

Freddie Mac Sets New Timelines for Short Sales to Help Add Transparency, Expedite Decisions

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In an effort to make the short sale process more transparent, Freddie Mac (OTC: FMCC) is updating its timelines and also requiring servicers to provide weekly updates when decisions take more than 30 days after the receipt of a complete application for a short sale under the Obama Administration’s Home Affordable Foreclosure Alternative (HAFA) initiative or Freddie Mac’s traditional requirements. All decisions must be made within 60-days.  Today’s announcement marks the newest part of the Servicing Alignment Initiative (SAI) Freddie Mac and Fannie Maelaunched in 2011 at the direction of their regulator, the Federal Housing Finance Agency, to set consistent servicing and delinquency management requirements. Last year Freddie Mac completed 45,623 short sales, a 140 percent increase since the housing crisis began.

News Facts

Freddie Mac’s new short sale timelines require servicers to make a decision within 30 days of receiving either 1) an offer on a property  under Freddie Mac’s traditional short sale program or 2) a completed Borrower Response Package (BRP) requesting consideration for a short sale under HAFA or Freddie Mac’s traditional short sale program.  (BRPs are standardized assistance applications developed as part of the Servicing Alignment Initiative.)

  • If more than 30 days are needed, borrowers must receive weekly status updates and a decision no later than 60 days from the date the complete BRP is received.  This will help servicers who may need more time to obtain a broker price opinion or a private mortgage insurer’s approval on a BRP or property offer.
  • In the event a servicer makes a counteroffer, the borrower is expected to respond within five business days. The servicer must then respond within 10 business days of receiving the borrower’s response.
  • Freddie Mac will use the new timelines to evaluate servicer compliance with the SAI and its own servicing requirements.
  • Freddie Mac completed 45,623 short sales in 2011, a 140 percent increase since 2009.  Overall, Freddie Mac has also helped more than 615,000 distressed borrowers avoid foreclosure since the housing crisis began.

 

Quote:

Attribute to Tracy Mooney, Senior Vice President, Single-Family Servicing and REO, Freddie Mac:

“Short sales are more complex than routine home sales since they may involve multiple parties and long-distance negotiating. Freddie Mac’s new timelines are intended to help  make the decision process more transparent and timely for short-sales under the Obama Administration’s HAFA program or Freddie Mac’s traditional short-sale option. Today’s announcement underscores our commitment to help reduce credit losses and taxpayer risks by supporting more opportunities for sustained occupancy in our nation’s homes.”

Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation’s residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters.  For more information, visitwww.FreddieMac.com.

 

 

 

SOURCE Freddie Mac

Will Short Sales Save the Housing Market

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Foreclosures are down and short sales are up, but what does this mean for the real estate market as a whole?

The answer depends on who you ask.

But first, some background: Short sales occur when a lender agrees to sell a home for less than what is owed on the mortgage. The lender forgives the difference, and the borrower unloads a home they can’t afford.

In an effort to avoid adding to their already large portfolios of bank-owned homes (REOs), lenders are beginning to seriously consider short sales as an alternative to foreclosure. According to a Bloomberg report released Tuesday, banks including Wells Fargo and JPMorgan Chase last year started giving away cash to select homeowners who agreed to do a short sale instead of allowing the house to fall into foreclosure.

Experts at the National Association of Realtors (NAR) hear the short sale process is becoming more streamlined, which is good news for buyers and lenders. This more organized process means short sales can be unloaded quickly — relative to foreclosures — instead of sitting on the market for a long period of time.

(Typically homes spend more than a year from the date of the first missed payment until the gavel falls on the foreclosure sale, but in places like New York, a bank can take nearly 3 years before foreclosing on a property.)

Like foreclosures, short sales can hurt home prices in the neighborhood. According to NAR, short sales typically sold for 17 percent below market value in February. That’s a steep price cut, but less than the average 22 percent discount for foreclosure sales.

Given that short sales typically recover more money for lenders, you’d think that short sales would be the preferred way of unloading distressed property. They don’t add to banks’ REO inventory, they don’t sit on the market as long as foreclosures and the impact on home prices is not as substantial as that of a foreclosure.

If foreclosures don’t sell at auction they become bank-owned property, or REOs

But you’d be wrong. Since the housing bubble burst, the sale of foreclosed homes has far outpaced short sales. But that is beginning to change. On Tuesday, Bloomberg reported data from Lender Processing Services (LPS) which indicated short sales had surpassed foreclosure sales for the first time, by 4.2 percent in January — the most recent data available.

Jonathon Weiner, a vice president in the applied analytics division of LPS, told Bloomberg “It’s a fairly recent phenomenon that short sales have been increasing.” Short sales should be the dominant way of disposing of distressed property, Weiner said, because they can be processed quicker than foreclosures.

What does this mean for the real estate market?

An increase in short sales could mean that home values will fall further, faster. Weiner tells Bloomberg LPS’ “baseline scenario is home prices will hit bottom by the end of this year,” based on the fact that short sales now outpace foreclosures.

But not all analysts agree we’ve hit that threshold.

Walter Molony, a spokesman for NAR, said in an email that although NAR data does show an uptick in short sales for February, foreclosure sales still dominate the distressed market. Short sales rose to 14 percent market share month-over-month in February, but foreclosure/REO sales still lead at 20 percent. Moreover, the recently approved $26 billion foreclosure settlement means more than a million additional foreclosures are about to be pushed through the pipeline.

Why the disparity of data? Molony attributes the difference in findings to methodology and the measurement period. Home price, foreclosure and short sale data for March is set to be released this week. These data sets may shed more light on whether short sales are indeed picking up and if they are surpassing the number of foreclosures sold, even if it turns out to be temporary.

Regardless of whether or not they’re outpacing the sale of foreclosures, the uptick in short sales could signal a positive turn in housing crisis.

Short term, more short sales mean home values will remain low, or fall further. But over time, plowing through short sales could mean we’ll see fewer homes wind up in foreclosure or as REOs, which would push down home prices even more dramatically. At best, we avoid another big wave of foreclosures that would send home prices spiraling down even further, something no one wants to see, least of all homeowners who pay their mortgage on time each month.

Short Sales Surpass Foreclosures as Banks Agree to Deals

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April 17 (Bloomberg) — U.S. housing starts in March dropped 5.8 percent to a 654,000 annual rate, less than the lowest estimate of economists surveyed by Bloomberg News and the least since October, Commerce Department figures showed today in Washington. Michael McKee and Betty Liu report on Bloomberg Television’s “InsideTrack.” (Source: Bloomberg)

“It’s a fairly recent phenomenon that short sales have been increasing,” Jonathon Weiner, a vice president in the applied analytics division of Lender Processing Services, said in a telephone interview. “Short sales should be the dominant way of disposing of assets” in distress, he said.

Lenders are catching up to short sales after being slow to provide the staffing and incentives necessary to complete the deals, Weiner said. The transactions typically fetch a higher price for banks than sales of homes that have gone through foreclosure. In January, foreclosed homes sold for an average of 29 percent less than comparable non-distressed properties, compared with a 23 percent discount for short sales, according to Lender Processing Services. The gap has narrowed as short sales become more common, Weiner said.

The growing percentage of short sales, which don’t require going through the drawn-out foreclosure process, is a sign that the U.S. is making progress in working through its inventory of distressed properties, Weiner said. The increase in short sales also may help values find a floor quicker.

“Our baseline scenario is that home prices will hit a bottom at the end of this year,” he said.

Cash Incentives

Banks including Wells Fargo & Co. (WFC) and JPMorgan Chase & Co. (JPM) last year began giving cash inducements as high as $35,000 to selected homeowners who agreed to a short sale as a way of speeding up the process.

Bank of America Corp. paid $19.9 million in the first two months of this year for 22,534 homeowners to relocate after short sales and deeds in lieu of foreclosure, when borrowers agree to return the property deed in exchange for debt forgiveness, the Charlotte, North Carolina-based company said March 16. Its short sales rose 31 percent in January and February from a year earlier.

Banks have struggled to reduce losses from delinquent mortgages. Almost 4.4 percent of homes with loans had received a notice of foreclosure sale at the end of 2011, the 11th consecutive quarter the rate has been higher than 4 percent, according to the Mortgage Bankers Association.

Falling Foreclosures

Foreclosure filings, including notices of defaults and bank repossessions, fell 16 percent in the first quarter from a year earlier after lenders under legal scrutiny slowed actions against delinquent homeowners, RealtyTrac Inc. reported April 12.

Lender Processing Services, a 2008 spinoff from title- insurance company Fidelity National Financial Inc. (FNF), counts short sales by tallying mortgage and property transfer documents filed with county recorders, Weiner said.

Other reports haven’t shown the same magnitude of short- sale growth. The National Association of Realtors reported that 13 percent of transactions were short sales and 22 percent were foreclosures in January. In February, short sales increased to 14 percent and foreclosure-related transactions declined to 20 percent, the group said March 21.

Showing an ‘Uptick’

The Realtors collect their data from transactions on the Multiple Listing Service, a database of homes on the market, and a survey of about 3,000 members, said Walter Molony, a spokesman for the association.

“The February data is showing a bit of an uptick,” he said in an e-mail from Washington. “We’re hearing the process is going a bit more smoothly now, so that comes as no surprise.”

The U.S. Department of Housing and Urban Development reported a preliminary 19,600 short sales in January, compared with the Lender Processing Services tally of 48,721. An April 6 HUD report showed that the number of short sales rose 4.3 percent from a year earlier as the number of real estate owned, or REO, sales — another name for foreclosure sales — fell 39 percent.

Before agreeing to accept a loss on a short sale, lenders usually require homeowners to show evidence of hardship, such as inability to afford their mortgage payments or the need to relocate for a job, said Weiner of Lender Processing Services.

California, Arizona

Short sales outnumbered foreclosures in states with some of the largest shares of homes facing foreclosure, such as Arizona, California, Florida, Nevada and New Jersey, Lender Processing Services reported.

In New Jersey, short sales have exceeded REO deals every month since June 2010. In January, short sales accounted for more than 15 percent of the 3,033 New Jersey homes sold, compared with 3.9 percent for foreclosures. It took 966 days for banks to repossess a home in New Jersey, second only to New York, according to RealtyTrac. Both states require judicial hearings for foreclosure approval.

In New York, where it takes 1,056 days to repossess a home, 7.9 percent of purchases in January were short sales while 2.3 percent involved bank-owned properties.

“In general, markets where larger incentives are provided usually have extended foreclosure timelines, such as Florida,” Tom Goyda, a spokesman for Wells Fargo, said in an e-mail from Ellisville, Missouri. Wells Fargo, which doesn’t disclose its short-sale totals, offers homeowners as much as $20,000 to relocate, he said.

Florida Short Sales

In Florida, the number of short sales has exceeded foreclosures since July, according to Lender Processing Services. That’s about nine months after banks imposed a moratorium on home seizures amid allegations they used improper documentation and forged paperwork to claim title to properties with delinquent mortgages. The five largest loan servicers, including Wells Fargo, Bank of America and JPMorgan, agreed in February to a $25 billion settlement of the allegations.

In California, which has the largest number of homes facing foreclosure, short sales have outnumbered sales of bank-owned homes since August. In January, 37.2 percent of homes sold in the state were short sales compared with 25.8 percent for foreclosures, according to Lender Processing Services.

Banks have sped up the short-sale approval process, requiring less paperwork to prove hardship, especially for homeowners who haven’t made a mortgage payment for months on their primary residence, said Ethan Gregory, a broker with First Coast Realty Associates in Jacksonville, Florida. Banks have offered his clients as much as $13,000 to relocate, an incentive that gets the homeowners engaged in selling the home, he said.

Banks “embraced it before the settlement, but the settlement pushed them to do more streamlining,” said Gregory, whose firm handles about 50 short sales a year. “They understand it’s really the best exit for them.”

Buying a Foreclosed Property: What Homeowners Need to Know

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*Note: with so many distressed and bank owned homes out there you need an expert agent to help guide you through the maze.  360 Realty has the speciality agents you need when it comes to buying these homes.  Call us today! 800-399-9659

The housing market may still be struggling to gain solid footing—low interest rates and significantly-discounted prices make it a great time to purchase a home in most regions.

Housing prices are still below their peak in 2006, and another wave of foreclosed properties is expected to hit the housing market this year as banks unload their backlog—offering homes at low prices.

“Home prices will continue to be very fragile,” says Daren Blomquist, vice president at RealtyTrac. “We don’t expect prices to fall another 20% to 30%, but there won’t be a recovery until the distressed inventory has cleared.”

RealtyTrac estimates that home prices will start to increase once banks clear their 17-month inventory of foreclosed properties. The national average of prices for foreclosed (real estate owned or bank-owned) properties at $152,465 continues to be lower than the sales price for all properties (including foreclosure and non-foreclosure) at $203,779, according to RealtyTrac.

Areas experiencing the most discounts on housing include Philadelphia, St. Louis, Chicago, San Francisco and Atlanta, according to RealtyTrac. Washington, D.C. and New York have shown relative strength and have home prices at least 50% above 2000 price levels, but still below their peak.

While some housing markets started to recover, home prices started to fall again in all markets last quarter, according to Maureen Maitland, vice president at Standard & Poor’s Indices. “On a nominal basis, housing prices are the same as those in 2002 and 2003, having declined from their peak in 2006 due to the high number of foreclosures.”

According to the National Association of Realtors, all cash sales accounted for 33% of real estate sales in February.

“In February, 20% of closed sales were of foreclosures– they’ve been at comparable levels for some time,” says Walter Molony, senior public affairs specialist at the National Association of Realtors. “There’s competition in most market areas between cash investors and first-time buyers, with reports of multiple bidding on discounted foreclosures becoming more common.”

Nevada, California, and Arizona experienced the highest number of foreclosure filings at the end of February, according to RealtyTrac. They had between two and three times more than the nation, as one in every 637 homes in the nation, or 0.16% of homes, received a foreclosure filing, a notice that the foreclosure process will begin.

The number of foreclosure filings in a state can translate to that state having the highest percentage of foreclosure sales, as Nevada had 56%, California had 43%, and Georgia had 39% of all sales being foreclosed homes during the fourth quarter of 2011, according to RealtyTrac.

How to Finance a Foreclosed PropertyBuyers of foreclosed homes can take advantage of special programs offered by the Department of Housing and Urban Development when borrowing money. Private lenders fund Federal Housing Administration Section 203(k) loans that have mortgage insurance provided by HUD. Borrowers can take advantage of a 3.5% down payment and use a portion of loan proceeds to rehabilitate an owner-occupied house. When the buyer plans to rehabilitate a property, they can borrow up to an additional 10% of the house value as determined by appraisals and construction estimates.

Buyers planning to finance purchase with a conventional loan can take advantage of low interest rates. The national average commitment rate for a 30-year, conventional, fixed-rate mortgage was most recently at 4.08%, up from 3.89% in February, according to Freddie Mac.

When buying in these markets, experts recommend doing your homework. “Each individual area has many of its own individual markets,” says Erin O’Connor, real estate agent with RE/MAX Excalibur. “It’s crucial for homebuyers to become educated on their real estate market because it can be wildly different from the real estate market a few miles away and national averages. In areas where foreclosure inventories are low, the price gaps between a distressed sale, whether an REO or short sale, and a regular sale are rapidly closing.”

There are still pockets of the country that are slower to rebound. “This is an opportunity to buy low,” says Blomquist. “You won’t see your property value skyrocket overnight, but, in the long-term, you’re setting yourself up for a great investment. The property has a built-in discount because it’s a distressed sale.” When looking at a foreclosed property, he advises potential buyers to remember that the basic real estate mantra still applies—location, location, location!

Source: http://www.foxbusiness.com Written by Andrea Murad

Important HAFA Program Changes

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The federal government’s flagship HAFA short sale program continues to evolve in hopes of more effectively addressing the needs of distressed homeowners for whom continued ownership is not longer a realistic option.  The most recent Supplemental Directive 12-02 was released on March 9, 2012; loan servicers are instructed to implement program changes effective immediately.  They include:

  •  There are no longer any occupancy requirements for HAFA eligibility.
    Previously, HAFA required that the property be occupied as the borrower’s primary residence at some point within the prior 12 months.
  • The amount a servicer may authorize the settlement agent to pay from gross proceeds to subordinate mortgage holder(s) in exchange for a lien release and full release of borrower liability is increased from $6,000 to $8,500.
  • Borrower relocation incentives will be limited to HAFA short sales or Deed-in-Lieu transactions where the property is occupied by a borrower or a tenant at the time of the Short Sale Agreement or DIL Agreement and who will be required to vacate the property as a condition of the sale or DIL.
  • Borrowers may now elect to remain current on the loan during the term of the Short Sale Agreement or DIL Agreement.
  • Credit bureau reporting of HAFA transactions are amended as follows:
    • If the real estate is sold for less than the full balance owed and the deficiency balance is forgiven, report the following Base Segment fields as specified:  Account Status Code = 13 (Paid or closed account/zero balance) or 65 (Account paid in full/a foreclosure was started), as applicable.
  • The deadline for HAFA has been extended. A borrower now has until December 31, 2013 to submit a Short Sale Agreement or a written request for a consideration for a Short Sale Agreement to be eligible for HAFA.

The stated intention of the program updates is to expand the availability of HAFA’s benefits to more struggling homeowners.  Certainly, the increase in the amount of gross proceeds available to settle junior liens should help.  This has been an area of particular concern, most especially in California where the implementation in 2011 of SB 457 barred
lien holders from reserving collection rights following short sales or, alternatively, from conditioning short sale approval from additional seller contributions.  Of course, as with all previous program changes, the proof will be in the pudding.  Stay tuned….

 

 

 

 

Source: http://www.brianaripley.com/2012/03/26/important-hafa-program-changes-announced/

 

Pending Home Sales Near A 2-Year High

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More Americans are signing contracts to buy existing homes than at any time in nearly two years, according to the National Assn. of Realtors’ index of pending home sales.

The measure increased 2% in January from December, when it slipped 1.9%. And compared with January 2011, the index rose 8%. The index is based on the number of signed contracts reported to the nationwide Multiple Listing Service and large brokerages. The trade group said that about 80% of signed deals are finalized within two months.

In January, the index hit 97, its highest level since April 2010, when consumers were drawn by a home buyer tax credit. At that point the index, as tallied by the association, hit 111.3. It was the last time the measure exceeded 100 — the group’s benchmark for industry health.

The index for January showed year-over-year increases in every region — a 9.8% hike in the Northeast, a 10.8% rise in the Midwest, a 10.5% boost in the South and a 0.7% uptick in the West.

Because contracts are usually signed a month or two before a deal closes, the index is an indicator for where the market is headed. The association said last week that existing home sales in January rose more than 4% to an annualized rate of 4.57 million.

Housing experts such as Lawrence Yun, the trade group’s chief economist, credit the boost in the sliding unemployment rate — which fell to its lowest point in three years in January — as well as a downward trend in home prices and a supply of homes at a nearly seven-year low.

“Movements in the index have been uneven, reflecting the head winds of tight credit,” Yun said in a statement, “but job gains, high affordability and rising rents are hopefully pushing the market into what appears to be a sustained housing recovery.”

 

 

 

Source: www.LaTimes.com By Tiffany Hsu

The U.S. Foreclosure Crisis, Beverly Hills-Style

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The dynamics of the residential real estate collapse are very different in elite neighborhoods

The careworn house not far from Santa Monica Boulevard resembles millions of other homes that have been foreclosed on since the calamitous U.S. housing crash four years ago.

Garbage spews from trash bags behind the property. A smashed television leans against broken furniture. A filthy toy dog lies on its side, an ear draped across its face. The garden is overgrown. The house needs a paint job.

Yet the property on North Rexford Drive, Beverly Hills, California, is no ordinary foreclosure.

A sprawling, Spanish-style estate, fringed by majestic pine trees and located near the boutiques of Santa Monica Boulevard, its former owners were served with a default notice in 2010; they were $205,000 behind in their payments on mortgages totaling $6.9 million.

Welcome to foreclosure Beverly Hills-style.

Some 180 houses in Beverly Hills, the storied Los Angeles enclave rich with Hollywood stars and music moguls, have been foreclosed on by lenders, scheduled for auction, or served with a default notice, the highest level since the 2008 financial crash, according to a Reuters analysis of figures compiled by RealtyTrac, which tracks foreclosures nationwide.

As in the default-ravaged suburban subdivisions of Phoenix, Arizona, and Tampa, Florida, plunging realestate prices are the root of the problem in Beverly Hills.

But the dynamics of the residential real estate collapse are very different in elite neighborhoods such as this. The majority of delinquent homeowners here owe more than $1 million. Many are walking away not because they can’t pay, but because they judge it would be foolish to keep doing so.

“It’s a business decision, not an emotional one which it is for normal people,” said Deborah Bremner, owner of the Bremner Group at Coldwell Banker, which specializes in high-end properties in the Los Angeles area. “I go to cocktail parties and all people are talking about is whether it is time to walk away, although they will never be quoted in the real world.”

She said she had seen in Beverly Hills a big increase in “strategic defaults,” in which owners who can still afford to make their monthly mortgage payment choose not to because the property is now worth so much less than the giant loan used to buy it during the housing bubble.

Strategic default is an especially appealing option in California, one of only a handful of U.S. states where primary mortgages made by banks are “non-recourse” loans. That means the loan is secured solely by the property, and banks cannot go after a delinquent owner’s wages or other assets if they default.

Bremner said she helped a client buy a Beverly Hills mansion last year that the prior owner had bought for over $4 million. He decided to stop paying his $3 million mortgage – even though he could easily afford it – when the value of the property had dropped to $2.5 million.

“They were able to comfortably cover the loan,” Bremner said. “They were just no longer willing to see the value of the property drop.”

A huge “shadow inventory” is building of elite homes that are in default but have not been put on the market. Of the 180 distressed properties in Beverly Hills, only 12 are up for sale.

The backlog reflects the pent-up flood of foreclosed properties of all price ranges that are expected to hit the U.S. market this year, especially after five major banks reached a $25 billion settlement last week with the U.S. over fraudulent foreclosure practices.

‘Jumbo’ loans
Across the United States, the largest increase in foreclosures and delinquencies, compared with 2008 levels, is with “jumbo” mortgages – loans too large to be insured by Fannie Mae and Freddie Mac, the government controlled mortgage finance providers. Foreclosures on jumbo loans are up 579 percent since 2008, greater than any other form of loan, according to a report last month by Lender Processing Services, Inc.

Strategic defaults are now more likely among jumbo loan-holders than any other type of borrower, according to a report issued late last year by JPMorgan Chase & Co. Nearly 40 percent of delinquencies among non-governmental mortgages, which are mostly jumbo loans, are strategic defaults, the report said.

“Now that these homeowners with jumbo loans are finding out you can do this, more and more are doing strategic foreclosures,” said Jon Maddux the CEO of YouWalkAway.com, which advises homeowners who are “underwater,” the term for those whose loans exceed the value of their home.

Nathaniel J. Friedman, a Beverly Hills lawyer, insists he is not a strategic defaulter – that he never missed a mortgage payment in his life. But he stopped making payments on his five-bedroom, six-bathroom Beverly Hills house on Schuyler Road three years ago.

Friedman, who had mortgages totaling $3 million with the now-defunct Countrywide Home Loans, returned home one evening in January 2009 to find a letter from Countrywide freezing his $150,000 line of credit, which was linked to his second $900,000 loan. His primary loan was $2.1 million. The property is worth about $2 million today.

Friedman says he decided to stop paying out of a sense of vengeance from the moment he received that letter. He has been in negotiations for months with Bank of America, which took over Countrywide after its collapse, to modify the loan.

“I thought to hell with it,” he told Reuters. “Why should I keep feeding a dead horse if the bank has no confidence in me?”

“I was able to maneuver things my way because of the inertia of the banking sector,” Friedman said. He believes the bank will blink first, and eventually modify his loan.

 

 

Source:   Thomson Reuters, www.msnbc.msn.com/id/46411361/ns/business-real_estate/#.Tz1aT8VSSKY

The List of Celebrity Short Sales is Increasing

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They say celebrities are just like us, except richer, better looking and skinnier.  Perhaps.

What is indisputable, however, is that they are not spared from suffering through falling property values and other economic hardships so many Middle Americans are suffering through today.  Many of these athletes or celebrities bought when they received their big paychecks, then fell behind on their payments when times became more difficult.  The amount of money involved may be greater, but the situations of underlying economic hardships are similar.

The list of celebrities who are utilizing short sales to avoid facing foreclosure is increasing; it includes such names as:  Terrell Owens, R.Kelly, Jamarcus Russell, Chris Tucker,  Carnie Wilson, and several Reality TV stars.  The list continues to grow.

Most of these highly paid athletes or celebrities have business managers, lawyers and accountants advising them and otherwise looking out for their financial interests.  If celebrities are doing short sales on their multi-million dollar homes because that is a better outcome than foreclosure, why wouldn’t it be good for the average homeowner?  What’s good for the goose must be good for the gander, right?

The chasm between the lifestyles of celebrities and those of Middle Americans seem to be shrinking.   Just as not every homeowner is facing foreclosure, not every celebrity is in the same situation.  However, just like Middle Americans, now celebrities who have fallen on hard times are choosing short sales over foreclosures.  A reversal in trend, where celebrities are now doing things Middle Americans  first made popular.

 

 

 

Source: http://www.sanjoseshortsaleagent.com/2011/12/13/the-list-of-celebrity-short-sales-is-increasing/