Real Estate Information

Monday, November 17, 2008 was a very big day for me professionally. I was named a member of the Rockland Count Board of Realtors (RCBOR) for a two year term. It is very gratifying to realize that after only four years of practicing real estate in Rockland that I would be unanimously elected to our industry’s county governing board by a group of my peers.

RCBOR exists to help buyers, sellers and their realtors resolve complaints, hear and rule on ethics violations and arbitrate disputes involving real estate transactions. It is the first line of defense for the principles of honesty and fair play that are sometimes flaunted by Realtors. It is also a defender of innocent realtors who are unfairly accused by clients or other realtors when real estate deals go bad.

RCBOR also provides resources for realtors in the areas of sales training, brokerage and appraisal qualifying, classes in ethics, licensing laws, and many other subjects, all of which is intended to further the professionalism of realtors in Rockland County.

I am very proud to be a part of this organization, because I believe in those principles it seeks to protect. I pledge to do whatever I can to make Rockland County a great place to buy and sell real estate.

When our beloved Chloe, our 15 year old Golden Retriever passed away recently, we were devastated. Then one of my clients called me telling me of a 4 year old English Labrador that had been abandoned in PA.  He was the victim of a foreclosure home.

In the current wave of foreclosures, which many experts say has not yet peaked, a new phrase has entered the lexicon - foreclosure pets. Foreclosure pets are pets that have been left behind when a home is foreclosed. In some cases it is clear that foreclosure (or eviction) was only one of a number of serious problems, like the case in Ohio where 50 cats were found in a house after an eviction. In other cases, it may be a single pet, left behind perhaps because a family's new rental unit doesn't allow pets. 

It's all about survival. For thousands of people struggling to find money for food and shelter, pet care is often the last thing they think about. They spiral down financially, and in their personal life, and everything just falls apart for them. They feel like they have nowhere to turn, so they just close the door and walk away.

Foreclosure is an emotional and overwhelming experience, and it is not always easy to find a good home for a pet.  I suspect that this phenomenon also has to do with a common misperception about foreclosure. Many of my clients expect that they will be put out of their homes immediately. They fear coming home and finding their belongings in the street; many times they have been told by collection agents that it will happen. In New York, a full judicial foreclosure state, it takes at least six months, and often six months or longer to complete a foreclosure. Other states it is a much quicker process, but it is never instantaneous. Perhaps some of those leaving pets behind believe that someone will be coming just behind them to take care of things. If that is the case, they could not be more wrong. It can take months to foreclose; even worse, because of excessive inventory of foreclosed properties, lenders are sometimes deciding not to foreclose, or to postpone foreclosure.

Don't let the truly innocent suffer needlessly. If you are facing foreclosure and cannot care for your pets, or if you know someone has left a pet behind, call your local animal shelter or humane society. There are also rescue organizations of all sorts, including those focused on virtually any type of purebred dog, cat, or horse. A couple of examples: www.emergencyanimalrescue.org rescues domestic and wild animals in crisis situations, and http://www.bestfriends.org/ rescues dogs, cats, birds, horses, and rabbits, to name a few. Oh, and those 50 cats in Ohio? Visit http://www.foreclosurecats.org/ to see how they're doing now, or make a donation. If you can take in an abandoned pet, there will be stars in your crown in heaven, and a lot of fun right here in the meantime.

Dwight, our foreclosure rescue from PA has happily settled in well with us here in Piermont, and now trusts us after a couple of months of sheer terror at the thought of being left alone again. He is my constant companion and sits at my feet when I work at the computer and loves to ride around with me when I am looking at clients homes. He continues to learn the rules of the house, like don't eat the cat, and hasn't quite picked up yet on don't eat the cat food!  Dwight on right, enjoying a romp with my daughter's dog Boston

The Emergency Economic Stabilization Act of 2008, also known as ‘the bailout bill’ that has been dominating headlines in recent weeks, has real estate leaders talking about its impact on the industry, real estate markets around the country and the overall effect on consumer confidence when it comes to buying and selling.

Was the bailout necessary? The bailout was needed. It will allow banks and note holders to get direct liquidity. This is a strategy, though certainly not the complete answer to our current situation

What is the bailout’s effect on consumer confidence in the real estate market? It will take time for consumer confidence to come back to the market. I think something to be cognizant of is that people are now afraid for their jobs. Nothing changes overnight. We have a lot of instability and uncertainty in this country right now. We’ll have to wait and see how the country reacts to the bailout once things start to happen and the election is over.

Inventory is high. Consumers are just not confident in anything.

What do I think is needed to get consumers back to buying and selling?
If job security goes up, job demand will push real estate up as well. When more jobs come in, there are just more transactions. There are a lot of buyers who aren’t buying right now because they want to see what will happen-with the economy, with their jobs, with everything.

From the sellers point of view we need to look at the prices we’re offering. It needs to be a realistic price or it should be taken off the market. Then there wouldn’t be so much inventory.

So is now a good time to buy?
If you talk to people who bought their homes anywhere between 10-30 years ago, a good number of them will say that they wished they’d bought more. People are still looking for places to put their money.  Would you really put your money in stock market right now? No, and it’s a great time to invest in real estate. There are great buys, prices are down and you can get a lot of great deals from foreclosures.

It’s all about the law of supply and demand. Lower the prices and they’ll be a big push. However, we also need to have the best professionals offering the best customer experience. We have to look out for our buyers and sellers. In the boom years, there were some in this industry that said, ‘We’ll sell it-even if they can’t afford it.’ We just need to sell people homes that make sense, and that they can afford..

We already have an FHA rescue program that authorizes government to help homeowners in danger of foreclosure. FHA acts as the mortgage guarantor, but there are several other option open to sellers in trouble too.  My goal is to help those that don’t understand what those options are.

If you know of anyone that is experiencing financial difficulties and think that they might be in danger of loosing their home, have them give me a call.  As a Certified Distressed Property Expert, I may well be able to help, even when they are in the late stages of the proceedings.  Call me Vanessa Saunders at 845 598 5083 or email me vanessa@wesellny.com.  I’ll do my very best to help.

Looking for a mortgage or an auto loan may cause multiple lenders to request your credit report, even though you’re only looking for one loan. To compensate for this, the score ignores all mortgage and auto inquiries made in the 30 days prior to scoring. So, if you find a loan within 30 days, the inquiries won't affect your score while you're rate shopping. In addition, the score looks on your credit report for auto or mortgage inquiries older than 30 days. If it finds some, it counts all those inquiries that fall in a typical shopping period as just one inquiry when determining your score. For FICO scores calculated from older versions of the scoring formula, this shopping period is any 14 day span. For FICO scores calculated from the newest versions of the scoring formula, this shopping period is any 45 day span. Each lender chooses which version of the FICO scoring formula it wants the credit reporting agency to use to calculate your FICO score. 

Information gathered at: 

www.myfico.com

 Todd Neuman

Mortgage Advisor

Coldwell Banker Home Loans

201.800.2003

845.548.0388

I constantly feel that I am a punching bag for my clients and peers these days. As Realtors, we get stuck firmly in the middle of our clients' problems. Apart from the normal stress of both buying and selling, (which now is exacerbated by our current market conditions and overall difficult times,) we get entrenched in the most personal of situations. From death and divorce to job loss, forced relocations, short sales and foreclosure, it seems as if everyone is constantly yelling in a time when people most need each other. We actually should be trying to work together instead of alienating each other.

Sometimes, when my day feels like it will never finish, my dinner once again grown cold as I try to reassure yet another anxious client, I climb into bed exhausted, emotionally drained and close to tears.  The thing that keeps me together is my supportive environment. My husband and family, and my friends (of which nearly all of my clients end up being eventually,) are partly the key. Coupled with a great manager and team, I strive to overcome the constant onslaught of negative news and gloomy people. Not surprisingly, we are prospering, in fact doing better than ever, in spite of what the market does.

I am constantly being asked how I maintain such a positive mindset in today's turbulent economic climate.  Certainly these are challenging times for everyone. We are all concerned about what could happen if the financial bailout doesn't work.  How will people buy homes when lenders have limited funds? How many more people will lose their jobs? As a result, how many more will face foreclosure?  While we cannot control what the markets and the government do, the one thing we can all control is our mindset. 

I have a customer who is a Wall Street banker and has been exceedingly worried about selling a property which they have already lost a significant amount of money on. His wife called last night in tears, stressed and upset at hearing that the market had made yet another significant drop that day, and that several of their friends and colleagues had lost their financial jobs. As we talked, I explained that when I need things to happen, I write down what I want. Surprisingly, things very often fall into place when we clarify what we need and control our mindset.

One of the most powerful ways to control your mindset is to control your environment. Surrounding yourself with people that care about you and will do all they can to help is a great way to start.  Buckminster Fuller, the inventor of the geodesic dome, once said, "Environment is stronger than will."  Therefore, if you surround yourself with people who only see the worst in every situation and you listen to the negative news around you, your environment will support you to attract negative events.  Psychologists call this a “self-fulfilling prophecy.”  What you concentrate on and what you expect will happen can lead to actions that cause it to happen.

Never underestimate how much your environment can influence your life. I am always telling my clients and peers that I am the person I am because I "Always look on the bright side of life!" Albeit straight out of Monty Python’s “Life of Brian,” it works. While many of us attempt to use willpower to accomplish what they feel needs to happen, they seldom think about the role our environment plays. However, without a supportive environment, willpower will eventually run out of steam. Find something, anything, that is positive and focus on it. Surround yourself with positive, optimistic people. You'll be surprised how life will change for the better.

Oh and the Wall Street Banker and his wife got a really good offer on their home today!

The real estate and financial crisis has become the biggest item in the news worldwide, and the U.S. Federal Reserve and Dept. Of the Treasury are just starting to take action on the $700 billion bailout plan to purchase mortgage backed securities from financial institutions. Aside from watching the markets gyrate in anticipation, there isn't much for us to evaluate about this program so far. The size of the bailout and method of using reverse auctions to purchase mortgage backed securities have been questioned by critics as being either too big or too small, and in either case perhaps not an effective way to restore liquidity to markets. One aspect that may soon become apparent is whether and how quickly banks and firms may jump back into the market. Warren Buffett made a $5 billion investment in Goldman Sachs, and once the Congressional bailout became law, Wells Fargo bid to assume all of Wachovia Bank's debt in a purchase bid that may prevent rival Citibank from gaining control. These investments may indicate that others will sense opportunities and jump back into the market now that there is a way to value the mortgage backed securities. The latest statement from Federal Reserve Chairman Bernanke indicates that despite the many actions and programs currently being implemented, the Fed is counting in part on the markets to revive themselves.

To pay or not to pay?  – That is the question…

I have been coming across more and more homeowners who are in a quandary. They are not behind in their mortgage nor in any stage of foreclosure, and yet they want to sell their home which has dropped in value and would end up being a short sale. Although more and more banks are accepting short sales that are not in default, it is hit or miss. An impending foreclosure really motivates the bank. The thought of yet another non-performing asset does not bode well with the balance sheet so the bank really doesn't want to become a homeowner.

So as a homeowner in this situation what are your options? Well for one keep paying as agreed and wait for the market to turn around. If that isn't an option because of an upcoming ARM reset, forced relocation, or other outside circumstance out of your control, then you have some tough choices to make. You have to look at your monthly expenses and arrange them according to priority and see if paying your mortgage makes logical and economical sense. For example if your refrigerator is empty and you have 1/4 tank of gas and your choice is pay your mortgage or eat and be able to get to work then the answer should be obvious.

I would never advise anyone to miss mortgage payments for the sole purpose of gaining leverage for negotiating a short sale.  This is the same type of thinking that got us in this mess to begin with. There is nothing wrong with not paying your bills if you can't, It's using it as a strategy for some other reason is what I and the law has a problem with. 

Owners of investment property may have a tougher time but it really depends on the individual’s financials. If he has a portfolio of investment properties and wants to short sell one because it is under performing, good luck. On the other hand, the small time investor with one or two properties may have a fighting chance if you present a good case.

Of course there are people in our business advising this type of behavior. My only response to those who are thinking of it is to speak with a competent attorney and/or accountant.

What is a Deficiency Judgment? The amount of money owed to a bank after a short sale can attempt to be recovered through a suit known as a deficiency judgment. Equally important to note, if the bank sells the property for less than what was owed or the foreclosure auction nets them less than what was owed they can also file a deficiency judgment against the former owner. In terms of a deficiency judgment after foreclosure or short sale, the bank may be able to go after other assets, but any retirement funds the former homeowners have are generally protected. Especially if they invest their retirement savings in an IRA or through work in a 401(k), 403(b), then the bank can not try to seize any of these savings. However, if their retirement funds are "invested" in a second home or a other assets, then the bank may be able to go after those assets. That is because specifically designated retirement accounts are protected from creditors, while assets simply invested in for the purpose of saving for retirement without the special designation are not protected. In most cases, the lender rarely pursues the deficiency judgment. They may file suit so it appears on the former homeowner’s credit report, but little else after that. Mortgage companies know that people in foreclosure do not have the money to pay the monthly mortgage payment, let alone pay the entire foreclosure judgment or a deficiency judgment after foreclosure. Thus, it is just not worth the lenders' time to keep suing homeowners with no expectation of ever collecting anything from the lawsuits. A CDPE can negotiate with the bank to forgive the balance owed as the result of a short sale. Yet another reason to hire a competent Realtor with the CDPE designation.

Foreclosure Help, Get Educated!!

If you fail to make your mortgage payments, your bank or lender may issue an NOD, or Notice of Default. This is essentially a notice that you were late in making your mortgage payment and that legal action may be taken. If you continue to be delinquent, the bank or lender may repossess your home. This legal proceeding is known as a foreclosure, and will result in the loss of your home, additional foreclosure fees, legal fees, and possibly a deficiency judgment if your outstanding liens exceed the current value of your home. But keep in mind that there are ways to avoid foreclosure, which are detailed below.

The foreclosure process usually goes something like this: You may lose your job, fall ill, or simply fall behind on your mortgage payments. Unfortunately these aren’t valid reasons to miss your mortgage payment. When you originally applied for a loan, you likely verified asset reserves that prove to the bank that you can afford the loan for a certain amount of months, even if you fail to receive any additional income. Once you miss your first payment, the bank or lender will hit you with a 30-day late. At this point your credit will take a huge hit, and a representative from the bank or lender may call you, or send you a notice in the mail regarding your failure to pay on time. The bank or lender may also discuss a forbearance plan with you to resolve the missed payment to get you back on track. This is basically a special payment plan the bank sets up with the borrower to either lower payments or suspend payments to ease the repayment of the loan.

The bank or lender may also discuss refinancing the loan to terms that make your payments more affordable. But you’ll have to prove to them that you’ll be able to handle the new financing terms. But if you fail to talk with your bank or lender, and continue to avoid paying your mortgage, you will be hit with a 60-day late, then a 90-day late. At this point your credit will be all but ruined, and any chances for refinancing or seeking a forbearance plan will be most likely lost. Once you hit the 90-day late mark, the bank or lender will likely hit you with an NOD. The Notice of Default essentially states that you have 30 days to make the payment current, appear in court, or face the risk of a foreclosure. If 30 days go by and you fail to appear in court or make your payments current, the court can schedule an auction to sell your home within 7 days. If the auction ends without a buyer, the bank or lender will gain ownership and likely perform maintenance on the property, and clear up any title issues, then put it on the market.

 After paying legal fees, foreclosure fees, late fees, and losing your home, you will also get a huge ding on your credit report. A foreclosure will drop your credit score dramatically and prevent you from borrowing from A-paper banks for as long as 4 years. This is just one scenario for how late mortgage payments can end in foreclosure. Luckily there are a number of ways you can stop loan foreclosure. They include: - Refinance - Forbearance plan - Partial Claim - Pre-Foreclosure Sale - Deed in Lieu of Foreclosure - Real estate Short Sales As I mentioned above, a refinance granted by your bank or lender may ease payments and get you back on track. But you will need to qualify and display the ability to make the payments. Your bank or lender may be able to save you from foreclosure by putting you on an interest-only loan or a shorter-term ARM to lower the monthly mortgage costs.

A forbearance plan is a payment plan set up by your bank or lender to ease or even suspend payments until you are current again. The bank or lender may work with you to avoid foreclosure with a special program that can get you back in the black, and out of the red. A partial claim allows the mortgagee to advance funds to the mortgagor in the form of a promissory note. So long as you are not delinquent over 12 months, the HUD may grant you a partial claim, which will make your mortgage payments current. It is essentially a second mortgage behind your existing lien that collects no interest, and is not due until you pay off your first mortgage or sell your home.

 A pre-foreclosure sale will help you avoid a foreclosure, but unfortunately at the cost of selling your home, likely for much less than it’s worth. One final option is a deed in lieu of foreclosure, which allows you to sell your home back to the lender or bank that financed the mortgage. It is a great way to avoid foreclosure proceedings, but again results in the loss of your home. This must be voluntary, and both parties must act in good faith. The bank or lender must buy the property for at least fair market value, but will usually not proceed if that value exceeds the existing liens. One final thing to note is that despite all the available, regulated, and honest means available for saving your home from foreclosure, many foreclosure scams are also prevalent.

These scam artists will do their best to contact you during pre-foreclosure to rip you off using a variety of different means including bait and switch schemes, equity skimming, fake bailouts, and overpriced help. Always do your due diligence when seeking foreclosure help. At that point you’re already in enough trouble. Anything more could push you over the breaking point. If you have any questions, please feel free to email or call me anytime.

vanessa@avoidforeclosureinrockland.com

Foreclosure is the means that a bank has a legal right to take possession of a property if the mortgagor (owner) has failed to live up to the commitments as outlined in the mortgage agreement.

Usually just one missed payment will trigger this process.

Foreclosure in itself is pretty straight forward. The process doesn’t start until after the bank has failed to receive payment and has filed suit to foreclose. In New York the legal term is Lis Pendens. Lis Pendens is the formal notice that starts the legal process. (Note: In New York formal notice could mean a notice published in a newspaper-it doesn’t have to be actually served or given to the mortgagor in person.) Once a Lis Pendens is filed, the mortgagor is required to appear in court to answer to the allegations in the suit. At this point, the mortgagor can ask the judge for an extension to buy time.

Nowadays the extensions are being granted regularly. If the mortgagor didn’t respond to the suit at the initial hearing, a judgment against the mortgagor will be found and another date is set for a ‘foreclosure sale’ or auction of the property, typically 30 days after the judgment. New York laws allow the homeowner to redeem the property at any time before the auction date. This is known as the ‘Redemption Period’.

After a certificate of sale is issued, the right to redemption is lost and the homeowner in effect no longer owns the property. Vanessa Check this is correct info The entire process from the time the mortgagor missed the first payment to the time the property is actually sold at auction typically is 180 days. It is has been taking longer because the mortgage companies have been back logged from the recent rash of foreclosures. The timeline can be extended considerably by asking the court for extensions.