Cape Coral Waterfront - Luxury Homes

Short Sales and How I Think They Should Be Handled

 

First of all I do not believe that any real estate agent should list a home as a short sale without having done some research first.

 

 

Research

 

You should have a preliminary title search done to determine if there is a second mortgage or any other liens on the property. Determine who the owner(s) are.

 

           

 

Document Collection

 

Next, you should collect all of the necessary paperwork that the lender will require for their short sale package. (Some banks require less/more documentation but this is a very 'standard' list)

 

Obviously the following that you'd normally complete:

 

• CMA - YES, you need to know the market value of the property!
• Listing Agreement
• Short Sale Addendum (if your board doesn't have one yet you should get an attorney to create one for you)
• Seller's Real Property Disclosure (Yes, even AS IS deals)
• HOA documents/ HOA/Condo disclosures as necessary
• Lead Based Paint Disclosure as necessary (pre 1978)

 

 

• Last 2 year's tax returns
• Last 2 month's bank statements
• Last 2 pay check stubs
• Letter of Authorization
• Financial Statement
• Hardship Letter

 

(if customer is missing a tax return or pay check stub have them write an explanation as to WHY (i.e. No paycheck stubs because they are 1099 contractor)

 

*for your info: Copy of mortgage statements

                                               

• If there are 2 lenders you will need these documents for each.

 

 

Listing Activities at property

 

 

• Take multiple photos of the property - the good and the bad. Obviously use the prettiest photos for your marketing material but disclose any known defects. The bad photos are good to show the seller's lender.

 

• Put an electronic lockbox on the front door or hidden if seller/tenant prefers. Agents that have to pick up a key or schedule to meet an owner/tenant/agent are WAY less likely to show that home. Especially in this current buyer's market. There are too many other choices available. Check out my previous blog about tenant occupied short sales.

 

• Install your sign.

 

Back at office

 

• Call bank(s). Ask them where to send the authorization to release and what their short sale process is. They'll either tell you over the phone or send you some additional package of information. Also make sure to verify where/to whom you will send the package once you do have an offer (ALWAYS goes to some different #/Dept)

 

• Enter property into MLS. Use multiple photos. Use a full description. Make the showing instructions easy to find and follow.

 

• Enter property onto the best internet sites. We typically start with point2agent and Realtor then add as necessary. Our listings are enhanced on Realtor so we can add more photos and a better description. Point2Agent is a great website to use to get your listings onto several other real estate websites.

 

• Add the property on your blog. Make it interesting. Use lots of photos. Talk about the emotional benefits.

 

           

Yay, Showings and Offers!

 

You get showings, and now an offer comes in. GREAT! How do I think offers on short sales should be handled? Like any other sale.

 

            Present all in a timely manner. Encourage your seller to make a decision asap. If they like the offer, have them sign the contract. We require all contracts to be on the Far/Bar As-Is contract along with the Short Sale Addendum. We also require a bank letter of funds available or a pre-approval letter and a copy of the buyer's escrow check.

 

            What's next? First of all, stop taking other offers! After the buyer and seller have agreed the property is now for all intents and purposes PENDING. Yes, there is a third party approval required but that DOES NOT mean that you do not have a CONTRACT. You do. I'm sorry to go off a little here but this one of my pet peeves. We have buyers write up all of the time to hear weird things like the following:

 

            1) Our seller isn't going to sign - it's up to the bank

            2) The seller has already accepted 4 other offers, they're waiting on the bank to respond

            3) They accepted another offer last week

            ETC.

 

My response to each:

1) Then we don't have a deal. I will continue to look for homes for my buyer. This obviously makes no sense. The contract is between the buyer and the seller - the bank is a third party approver only. Most banks won't even look at a file unless all documents are correct and signed/dated and still within timeframes.

            2) Why would you obligate your seller to sell his/her property 4 times? Again, I'm going to find my customer something else. This is a waste of time. I get what the agent is trying to do. For lack of better terms, 'have their cake and eat it too'. If one buyer gets tired of waiting, they'll have possibly 3 more in line. I get that but it is not done correctly. You can have one offer you are working on and 3 back up offers but not 4 contracts on the same house. That's utterly ridiculous.

            3) Really, then WHY is it not marked pending or active contingent short sale (that's our MLS's new rules for short sales that have been agreed on (under contract) but are waiting on bank approval)?

 

 

Listing agents: If you want to play the multiple offer game that is fine. I realize you want your seller to go with the most likely offer to get accepted and be able to close. That's a no-brainer. But you have to disclosure what you are doing. Like many bank owned listings, they'll say "We will be accepting offers for 5 days before we'll get an answer from the bank. At that point the bank will most likely ask for everyone's 'highest and best offer'." My response: GREAT, here's my buyers offer. It expires in 6 days. At least they know what they are doing. That makes sense!

 

 

Submit That Offer

 

            Ok, now back to the seller's bank. You should have already spoken to the bank(s) to know exactly what to send and to where. Create a nice coversheet detailing the borrowers (that's your seller) Property Address, Name and Loan #. Include page #s like a table of contents. Include the contact for the BPO/Appraisal. Include a preliminary Hud1 (get from your title company), updated financial if out-dated, comparables and property history of the property. Send this and call the following day to verify. (Some banks say it takes up to 72 hours to receive so you may have to call back again) DO NOT STOP CALLING UNTIL YOU HAVE VERIFIED THAT THEY HAVE RECEIVED THE PACKAGE AND THAT THEY HAVE EVERYTHING THEY NEED. Most of the time if you are NICE they will look through the package while you are on the phone and let you know. Also find out who the negotiator is and when the bpo/appraisal will be ordered. Get the negotiators Full Name, #, Extension and Email address if at all possible.

 

 

Follow up

 

            From today on, call at LEAST once a week. Some banks may have an answer within a week; others may not for 2-3 months. All banks work differently. Always ask them what their timeline is. Do not leave multiple messages in the same day. You will irritate the negotiator. They are very busy people. Most have 100-300 files on their desk. Make sure you acknowledge that and make their job easier by having everything ready for them. If they prefer email, shoot them over a quick email for an update. They appreciate the non-intrusiveness of email.

 

            Also each week, call your seller to let them know what the bank said. Call the buyer's agent to tell them what is going on. Tell them to call their buyers to advise. Call the title company to keep them in the loop. Communication is key. If you keep everyone in the loop your chances of a successful closing go WAY up!

 

 

Approval

 

            Now you have an approval. Make sure the closing date will work for everyone. Send the approval over to the buyer's agent and the title company. The buyer may need to get financing so make sure they have enough time for that. They'll also want to have an inspection completed. Make sure to have the electricity and water turned on for that. If your seller cannot afford to have it turned on then turn it on for them! You took the listing knowing the financial situation of the seller. Don't stop helping them out now.

 

            You know the rest of this, now it is just like any other transaction.

 

 

Close on the property

 

The sellers have now SOLD their house. The buyers have now BOUGHT the house they wanted at a good price. Everyone wins.

 

 

Conclusion

 

Good luck out there.

 

Buyers, don't be intimidated by short sales. Just make sure you have an agent working for you that understands the process. They'll be able to inform you right away if something doesn't add up or seem right.

 

 

Sellers, please do not make the mistake of listing your home as a short sale with just any agent. Make sure they fully understand the short sale process. This is a very important transaction in your life and not everyone is cut out to handle this for you.

 

We look forward to working with the other professional real estate agencies on short sales and the many buyers and sellers as well.

 © Susan Milner 2008

Yours in Success,

 

Susan Milner

Florida Future Realty, Inc.

www.Florida-Future-Realty.com

www.The-Extreme-Team.com

888-764-6665 toll free

239-542-8521 local

Susan@SusanMilner.com

http://www.findcapecoralrealestate.com/003C7E

Cape Coral gulf access properties are very reasonably priced in today's market.

Homes that were selling for $500,000-800,000 in 2005 are now selling for $300,000-500,000 today. 

What can you get at these prices? 

Under $300,000 you can find properties that may need some work, may take little longer to get out to open water but that have GREAT potential. We've seen a few just under $200,000!

From $300,000-$400,000 you can find homes that may not need ANY work. They may have quicker access as well.

And if you are ready to look in the $400,0000-600,000 range you can find it all! There are new/newer homes in this range with pools with great views!

If you are looking for a more luxurious, upscale home you can find exquisite properties on the river for under $1,000,000.

Curious about those wonderful riverfront homes under 1 million dollars? Go ahead and click to check out these Cape Coral Riverfront homes!

Ready for the ultimate in Cape Coral luxury? These homes in Tarpon Point, truly have it all! Priced into the millions, they'll make you wanna stay here Year Round! Tarpon Point homes for sale

That is just a small sampling of what you can find here in Cape Coral, Florida.

Our experienced agents can help you find exactly what you want. Feel free to send us a message or call our office to speak with one of our agents today!

Yours in Success,

Florida Future Realty, Inc.

(239) 542-8521

(888) 764-6665 Toll Free

FloridaFuture@Gmail.com

 

http://www.findcapecoralrealestate.com/003BED

Late on Payments -- Facing Foreclosure?

There are ways out. That's the #1 thing to know.

There are options available to homeowners who have missed mortgage payments & facing foreclosure.

Many homeowners do not realize that they could get out & save their credit too.

You have to know: The bank does NOT want your home. Especially not in the current buyer's market that most of the nation is in.  (This is true for MOST banks. I have recently ran into a few local banks who are thinking differently for some reason)

According to Freddie Mac the average cost for a bank to take back a property is $59,000! Why would a bank choose to lose so much? Wouldn't they rather work with you? Of course...

Typically, you can contact your lender & work something out. Thats the first place to start. Call them as soon as you know there may be a problem, don't wait until after you've missed more payments. Often times they will work out something with you to save you some time & money while times are tough. This may include an adjustment to your current loan or a grace period/forebearance.

If that doesn't work & you think you may risk losing your home, contact a real estate professional. Make sure you interview a few & find out what their experience with pre-foreclosures or short sales are. Some may have never dealt with this type of circumstance before.

You need to make sure you are honest with the agent so they can devise a plan for the sale of your home. Even if you owe more than the current market value, an educated agent can assist you in selling your house & saving your credit. Banks often times take a loss (also called a short-sale) on a property to avoid having to go through the expensive foreclosure proceeding. Short sales are all too common right now in our area.

Another option, if your credit is still intact, is to refinance (if you still have some equity). Again, contact a real estate professional for a referral to a mortgage broker or bank - or contact them directly if you know of someone. There may be a better loan available for you that will ease the monthly cost. Your current lender may even be willing to refinance you depending upon circumstances. Again, ASK. You don't know until you do.

The last option is to find a real estate investor who buys pre-foreclosures. Often times they have access to cash to remedy the situation quickly. Be advised though that they will be making a profit. That's expected but its something to keep in mind. Be careful if they ask you to sign a deed or trust. Have your attorney preview any/all paperwork first.

In conclusion, its pretty scary to be facing foreclosure on your home that you've worked so hard to purchase & maintain but keep in mind that there are many options available so be proactive as soon as you know there is a problem.

Don't give up until you explore all of your options.

 

We have assisted many homeowners with short sales and of course, traditional sales. We always advise that each homeowner contact both a real estate attorney and a tax accountant to make sure a short sale is their best option. There are other options available including deed-in-lieu, foreclosure and bankruptcy. Each comes with its own set of problems but one may be right for you if a short sale isn't.

Feel free to review our website for more information on this, or any other, real estate transaction.

To have us contact you to learn more about how short sales work -http://www.findcapecoralrealestate.com/short-sale-help

http://www.findcapecoralrealestate.com/003AD1

SW Cape Coral Gulf Access New Home - $475,000

Located in the wonderful SW Cape Coral area, this brand new home sits on a large 100 Gulf Access Canal.

Enjoy peaceful days & nights looking out across your waterfront oasis.

This home also has a large swimming pool.

4 bedrooms & 3 full bathrooms

Plus a den and/or Study

Formal Dining Room

Living Room with large glass sliders that pocket in to the lanai

Outdoor Grill included

18 inch ceramic tiles throughout

Upgraded kitchen appliances, counters & cabinets!

3 car garage with garage door openers!

Brick paver driveway & sidewalk

Tile Roof

 

View our Virtual Tour

Listing information provided by

Susan Milner of Florida Future Realty, Inc.

Susan@SusanMilner.com

(239) 218-2229

www.CapeCoral-LuxuryHomes.com

 

Large master bedroom with 2 separate vanities, jaccuzi tub & walk around shower

¦ plus many more features - check this one out today!

All for only $475,000.

http://www.findcapecoralrealestate.com/001C65

 

I just finished reading an article put out by The Associated Press over at MSNBC about the amount of FORECLOSURES. Looks like our area - Cape Coral / Fort Myers - ranks #1 according to data supplied by RealtyTrac.  You can click to read that article here.

 

Why all the foreclosures? I was asked just that last week by a woman who found me on my Cape Coral Real Estate website. She wanted to know why there were so many SHORT SALES and FORECLOSURES in our area.

 

There are a few reasons for it.

 

One reason is that real estate is cyclical. That's right. Real Estate goes up & it goes down. Check the historical data, it is true.

 

Another reason in our area specifically I suppose, everyone got greedy. Investors & just average people all wanted to make A LOT of $$$$ in real estate. They heard that their friends bought some land or a house in Cape Coral & doubled their money in 2 years. Heck, many of these same people made a lot of money in the previous few years here as well. Yes, that is also TRUE - check the records. But what goes up must come down?

 

It came down. Many investors speculators were just getting into the market here, building a new home hoping to make a fortune (because others did). Unfortunately, hundreds of other investors speculators were doing the exact same thing. The builders were delayed because of the influx, the city's permit department was behind too, - - you get the picture. Many investors speculators had to WAIT. While they waited many other homes finished & were sold to end users. But by the time their homes were near completion the supply was HUGE.  We still had a demand for Cape Coral homes but the supply was just too large.

 

Unfortunately, most of these investors speculators did not have a plan B. They assumed they would sell & make a fortune. Many, at this point, hoped that they could at least sell and break even or take a small loss just to move on. But we weren't able to tell the buyers to pay for the other's misfortune. They wanted a deal and were going to get a deal because of the excess inventory. Homes were, and still are, selling but they must be priced right.

 

The next reason is the lending. Yes, I said it. The lenders were giving loans to anyone with a pulse it seemed. How was it that an average person earning $50,000 a year was able to afford 2-5 brand new homes (around $250,000 each) with 0% down? HMMM. But they were given the loans. Did someone misstate the truth? Not sure but I do know that many were stated or even no doc loans so they weren't even checked on. The banks were making their money, so were the mortgage brokers. Heck, the real estate agents, appraisers, title companies, builders, etc were all making money as well. Home investor speculator was expecting to make theirs too.

 

The same banks that so generously handed out financing the previous few years were tightening up their guidelines. Many would be buyers could not qualify. Uh oh - that just shrunk our buyer pool.

 

Prices continued to decline, financing options changed, option arms reset, economy slowed as a whole....

 

So what can we do now? Read more about the

 

Cape Coral Foreclosure problem....

 

We can move the inventory. Yes, were have A LOT of abandoned homes in our area. Some were NEVER occupied. Some people just left their homes & moved elsewhere after they exhausted all of their options. They didn't have any equity to refinance, their credit was deteriorating, the banks that were so friendly before weren't as nice, they didn't know what else to do. Some have been lucky enough to short sale their homes, but that still isn't great. Better than a foreclosure but still not the ideal situation. It's all we can do if they can't afford the home.

 

 

So we continue to work with banks, selling their inventory (foreclosured properties). We continue to help owners sell their homes that are upside down in short sales. We continue to educate buyers to make sure they find the best home for their needs at the best price. We keep moving on.

 

 

Is the market turning around next year? NO. It's going to take some time. But we still get to call this place home.

 

 

Cape Coral is truly a paradise. Sure, the foreclosures (deals) are abundant, BUT the weather is still awesome, the beach is still close, boating, golf, friendly neighbors & so much more are still here, waiting for you.

 

 

Please feel free to leave comments or contact us directly with any questions or comments you may have concerning buying or selling in SW Florida.

 

 

Yours in Success, 

Susan Milner

Broker/Owner

www.Florida-Future-Realty.com

(239) 542-8521

Susan@SusanMilner.com

copyright 2008 Florida Future Realty, Inc.

http://www.findcapecoralrealestate.com/0020D1