"Open House" - Maryland Real Estate Blog

Local Realtor earns distinguished designation to help Maryland families avoid foreclosure

Jim Ellis of Re/Max Elite Realty in Baltimore has earned the prestigious Certified Distressed Property Expert (CDPE) designation, having completed extensive training in foreclosure avoidance, with a particular emphasis on short sales. At a time when millions of homeowners are struggling with the possibility of foreclosure, the skills and education amassed by Ellis will help benefit Maryland residents and communities.

Short sales allow the distressed homeowner to repay the mortgage at the price that the home sells for, even if it is lower than what is owed on the property. With plummeting property values, this can save many people from foreclosure and even bankruptcy. More and more lenders are willing to consider short sales because they are much less costly than foreclosures.

Today, more than 13 percent of homeowners are delinquent on their mortgage or in the foreclosure process. This is occurring across all price ranges, and the fastest-growing category of homes in foreclosure is the luxury home market.

"The CDPE designation has been invaluable as I work with homeowners and lenders on complicated short sales," said Ellis. "It is so rewarding to be able to help families save their homes from foreclosure.  The best part?  Our services cost the home owner nothing." 

Alex Charfen, co-founder and CEO of the Distressed Property Institute in Austin, Texas, said that agents such as Jim Ellis with the CDPE Designation have valuable perspective on the market, and training in short sales that can offer homeowners real alternatives to foreclosure, which can be devastating to credit ratings.

"These experts better understand market conditions than the average agent, and can help sellers through the complications of foreclosure avoidance," he said.

The Distressed Property Institute provides live and online courses to train real estate professionals how to help homeowners in distress, with a strong focus on handling short sales.

"Our goal is to help as many homeowners as possible, by educating as many real estate professionals as possible," Charfen said. "Jim has demonstrated a commitment to struggling homeowners - a commitment that can provide much-needed stabilization to the community."

For more information about how you can avoid foreclosure, visit Jim Ellis' website at www.JimEllisHomes.com. 

What is a Short Sale and Do I Qualify?

What is a Short Sale

According to the Certified Distressed Property Expert (CDPE) Field Manual a “short sale occurs when: A negotiation is entered into with the homeowner’s mortgage company or companies to accept less than the full balance of the loan at closing. A buyer closes on the property and the property is ‘sold short’.”

In today’s market, mortgage companies are increasingly encouraging and accepting short sales instead of affecting foreclosures. Lenders spend thousands more to foreclose on a property than accepting a short sale. In conjunction with stricter governmental guidelines, mortgage companies are worker harder to increase efficiencies and speed of the short sale process. It is certainly getting better.

Qualifying for a Short Sale

In order to qualify for a short sale a homeowner must first be able to prove a valid financial hardship. Wanting to sell when you owe more than the house is worth does not qualify. Second, the homeowner must not have liquid cash or assets that will pay down the mortgage. There have been cases where the homeowner can cover a portion of the short sale and the lender covers the remaining balance. The short sale process is terribly complicated and requires expertise only gathered through specialized training. A licensed Realtor® with the CDPE designation behind their name is a homeowner’s best chance of closing their short sale and avoiding foreclosure. Contact the author for a CDPE in your area.

A Common Short Sale Myth

Lastly, there have been many reports, both nationally and locally, stating a foreclosure and short sale have the same outcome and effect on a borrower’s credit. That is absolutely NOT TRUE. Click here to see a free copy of our report entitled, “Foreclosure v. Short Sale: A Homeowner’s Consequences”.

Jim Ellis – Re/Max Elite Realty

Jim can be reached at 410.569.4663 or jim.ellis@remax.net.

Foreclosure Bargains Getting Harder to Find

 
Home buyers hoping to snag a really good deal on a foreclosed home are finding it increasingly difficult because supply is shrinking.

The num ber of foreclosures that are available for sale nationwide fell to 617,000 in December, down from 845,000 in November 2008, reports Barclays Capital.

Not only have attractive homes in popular neighborhoods already been snapped up, but also government help for distressed buyers is delaying more foreclosures.

Demand is driving up prices. Investors say typical prices have climbed from 75 percent of appraised value to 85 percent or higher when there are bidding wars.

Source: The Wall Street Journal, James R. Hagerty (02/23/2010)

Report: Home Prices Likely to Hit Bottom in March - National News

Home prices in 45 of the largest housing markets are expected to fall another 4.2 percent before they hit bottom in March, according to First American CoreLogic’s LoanPerformance Home Price Index.

By October 2010, prices are expected to be heading upward again by about 1 percent compared to 2009.

The report warned that this progress could be jeopardized by an increasingly large “shadow inventory” of homes owned by banks but not yet on the market. The problem is particularly acute in Michigan and Ohio cities, the report said. It projected a 12.7 percent further decline in values in Detroit, an 11.4 percent decline in most of the rest of southeast Michigan, and a 6.3 percent fall in Cleveland.

The report expects the strongest recoveries next year in California cities. These include:

1. San Francisco, up 5.7 percent
2. Los Angeles, 5 percent
3. San Diego, 4.7 percent
4. Sacramento, 4.6 percent

Source: Inman News (12/21/2009)

MORTGAGE RESCUE SCAMS: TOP 10 WARNING SIGNS

The U.S. Department of the Treasury has issued a consumer advisory detailing common mortgage modification scams. It pays to be aware of fraudulent tactics that con artists may use to lure distressed homeowners into their trap.

1. “Pay us $1,000, and we’ll save your home.” No legitimate counselor will require you to pay such a large sum before they do any work for you.
2. “I guarantee I will save your home – trust me.” Unrealistic promises are a key tip-off that an arrangement may not be legitimate.
3. “Sign over your home, and we’ll let you stay in it.” This is a dangerous proposition: signing over your home gives another person the power to sell the house or evict you, and you’ll still be liable for the mortgage.
4. “Stop paying your mortgage.” Never stop paying your mortgage unless you have contacted your mortgage lender directly!
5. “If your lender calls, don’t talk to them.” You should keep in close touch with your lender, as their understanding of your situation is crucial to a satisfactory resolution.
6. “Your lender never had the legal authority to make a loan.” False arguments like this are meant to convince you that you are not obligated to pay your mortgage. Don’t fall for them!
7. “Just sign this now; we’ll fill in the blanks later.” Never sign anything you haven’t read in detail and clearly understood, and don’t let anyone pressure you into signing.
8. “Call 1-800-Fed-Loan.” It’s easy to make a scam look like part of a legitimate government program. Call your lender to see if you qualify for federal assistance—which does not require you to pay high fees.
9. “File for bankruptcy and keep your home.” Bankruptcy only stops the foreclosure process temporarily. Stop paying your mortgage, and your lender will eventually foreclose upon your home.
10.  “Why haven’t you replied to our offer? Do you want to live on the streets?” High-pressure tactics are a sure sign of shady business practices. Legitimate foreclosure counselors never treat a client in such a way.

If you guys ever have questions about mortgage issues, don't hesitate to call me.  I am always available as a free service to any of you if you are having problems or need help.  Don't get swindled!

I can be reached at 410.569.4663 or jimellishomes@comcast.net.

Happy Holidays!

Home Buyer Tax Credit Extended

 Congress has just approved a measure to extend the $8,000 first time homebuyer tax credit until April 30, 2010 and to increase the income limitation for single purchasers from $75,000 to $125,000 and for married purchasers from $150,000 to $225,000. 

Congress has also approved a new $6,500 tax credit for existing homeowners who purchase between the date of enactment and April 30, 2010.  Existing homeowners are eligible for the credit if they have used the home being sold as a principal residence for 5 of the previous 8 years.  Homes purchased using the this tax credit must be less than $800,000.   

The President is expected to sign the measure into law on Friday, November (6), 2009.

As posted by the GBBR, Greater Baltimore Board of Realtors.  Released in an e-mail on 11/5/2009.

The Ed Norris Show

Friday morning, June 12th, at 7:30 AM, I will be appearing on The Ed Norris Show.  The show is rated #1 among radio talk shows in the Baltimore area and can be heard at 105.7 FM.  Can't listen on the radio?  Go to www.1057thefan.com to listen for free on line.  Thanks for your support.

Jim

Jim can be reached at 410.569.HOME (4663) or email jim.ellis@remax.net

Foreclosure Avoidance Companies and Scams

If you find yourself in financial distress and are beginning to get foreclosure notices from your bank be very careful.

Many companies have popped up claiming to help home owners avoid foreclosure and many of them are scams.  At no time should you pay anything up front.  At no time should you resign your rights of ownership or loan decision making. 

The best advice I could give you is to contact me.  I have no financial interest and am simply interested in your well being.  I can help you negotiate with the banks and guide you through a difficult and complicated process.

Best Wishes to You All!

Jim

2009 Stimulus Package and Real Estate

On February 17th in Denver, President Obama signed the latest multi-billion dollar stimulus package into law. There are several aspects of the law that directly affect the struggling real estate market. The following details the two most important aspects and how they affect the housing market.

The supply of homes for sale continues to outpace the demand (eligible buyers). The goal and focus of the real estate portion of the stimulus package is to stimulate demand. The plan is designed to work on lower priced homes (under $350,000) and middle priced homes (between 350k and 750k).

        1.  Buy a Home, get $8,000 for FREE – This is literally free money. If you are a first-timer buyer or haven't owned a home in 3 years, the federal government will give you a tax credit for $8,000 on your 2010 tax return. You must purchase the home between January 1, 2009 and December 1, 2009. In order to receive the entire $8,000, you can't make more than $75,000 per year ($150,000 for a couple). It must be a primary residence and you are required to own the property for 3 years. Economists estimate that this tax credit will increase new buyer home sales by 300,000 nationwide. Click the link below for more specifics and details.

Modifications to First Time Buyer Tax Credit

        2.  Higher Loan Limits – When most of us purchase homes we buy a Conforming Loan. When your loan amount reaches a certain number, it is then considered a Jumbo Loan. Jumbo loans carry a much higher interest which creates affordability issues in the higher priced homes. In January, the loan limit fell in many markets. For example, the limit fell from $729,000 in the DC region to $625,000. Since loan limits vary place to place, consult a trusted mortgage lender for details in your area. The stimulus bill re-raises the loan limit back to the last year's higher level.

If you are a first time buyer, this may be the best time in history to buy a house. When will there be a time that the federal government will give you $8,000? Rates have been in the 5-6 percent range for several months now and these loans only require a 3.5% down payment. On a $200,000 you will only need $7,000 for your down payment. Don't have that saved? Borrow it from a friend or family member and pay them back with the extra 8k you will be getting from Uncle Sam in 2010.

Despite the incentive, it is important to be prudent and make wise decisions for you. If you are not financially or mentally ready for a home purchase, don't do it.

If you are ready, don't wait until November 1^st to get started. The home buying process requires several months of education and preparation. If you wait too long, you will miss the boat.

Jim

www.JimEllisHomes.com

Facing Foreclosure? - Don’t Walk Away

There are many Americans in financial distress these days. If you are one and in jeopardy of losing your home to foreclosure, the best advice I can give is DO NOT WALK AWAY. Some folks around the country stop paying their mortgage, pack up and move out.  Turning your back on the problem is not the answer; trust me!  The dominoes and repercussions of that action will stay with you for the better part of a decade; maybe even longer. The federal government and I can help.

As part of the stimulus package passed by Congress and signed by President Obama earlier this year, you may be eligible to refinance or renegotiate your home loan so that you can stay. If you are having trouble keeping up with your payments, don't be ashamed. You are not alone and help is a phone call away.  I am here to serve my clients and the residents of Maryland. Just because you aren't buying or selling real estate today, doesn't mean that I can't/won't help you.

If there is no way that you can keep your house or a refinance or renegotiation isn't doable then there are ways that your house can be sold in this market. Even if you owe more than the house is worth, banks are willing to work with you to sell your house for less than you owe. In most cases they don't even ask you to repay the difference. It is much cheaper for a bank to forgive a few thousand dollars in lost mortgage than to go through a foreclosure proceeding.

If you or anyone you know is having difficulty making mortgage payments, please call me. I would encourage you to forward this message to as many people as you can. They may not be willing to admit they need help to you, but may be encouraged to know there is a way out and will take the next step on their own. Thank you.

Jim