Phoenix Real Estate Market | 7,586 sales November 2009

Phoenix real estate market closes 7,586 sales in November 2009

The 7,586 residential sales recorded in November 2009 are 559 sales less than those recorded in October 2009. This reduction in sales is considered both normal and cyclical in the Phoenix real estate market. Sales peaked in June 2009 when 9,358 home sales were recorded.

The chart indicates a steady increase in home sales beginning in February and lasting until the peak in June. The steady decrease began in July and continues to date. Although not indicated on the chart, the year over year (YOY) sales in the Phoenix real estate market have now increased for two consecutive years. Sales in October 2007 were 3, 421 and sales in October 2008 were 5,267.

The Town of Maricopa was the only municipality in the Phoenix real estate market that was contrary to the decline in home sales. The Town of Maricopa experienced a slight increase in sales from 224 home sales in October to 235 homes sales and November 2009, a 5% increase.

Around the Phoenix real estate market, Scottsdale was the only other city with home sales consistent with October 2009. Scottsdale experienced a decrease of just under 2%.

I've been on other projects and slow to update these reports. Merry Christmas to all!

More about the Phoenix real estate market

Arizona Relocation

Phoenix Real Estate Prices Increase -- December 2009

Phoenix real estate prices continue to rise - December 2009

Yes, believe it or not Phoenix real estate prices have continued on an eight month increase. The chart you are looking at below indicates the appreciation (and depreciation) rates for Phoenix real estate over the two year period from November 2007 through November 2009.

The chart assumes a baseline price per square foot in November 2007, then shows how the price per square foot has declined for Phoenix real estate until a bottom was hit in March 2009. Prices for Phoenix real estate have continued to increase over the last eight months since the bottom in March of 2009.

This Phoenix real estate chart was obtained courtesy of the Cromford Report. They are experts in the Phoenix real estate market and devote a considerable amount of time to producing accurate reports. Their reports on the Phoenix real estate market are every bit as accurate as the Case-Schiller index, but much more timely.

The data I personally keep from my own research on the Phoenix real estate market coincides with this data. My data shows that Phoenix real estate appears to have bottomed out in March 2009 at a price per square foot of $66.00 for residential resale homes. The current price per square foot for Phoenix real estate is $84.00 per square foot according to my statistics.

My statistics for Phoenix real estate are based on single-family residences, townhomes, and patio homes that are over 1,000 square feet and sell for less than one million dollars. I believe this helps to "level out" the data by removing the "extremely low" and "extremely high" prices for Phoenix real estate.

There have been pessimistic reports about a dreaded "double dip" of depreciation for Phoenix real estate. In other words, the current price of Phoenix real estate may go downwards again. The operators of the Cromford report had not found any signs the indicate that a double dip is imminent.

Surrounding Phoenix market conditions

Phoenix Real Estate Market -- December 2009

Residential listings increased for the third consecutive month in the Phoenix Real Estate Market to begin December 2009. That translates into more homes for sale.

The increase in homes for sale began in October 1st, 2009 and has continued for the last three months (in pink).  The 3-month total increase in the number of homes for sale is 1,482 -- or 4.8% from October 1, 2009 -- from when the Phoenix real estate market was at two-year low in the number of residential homes for sale.

The demand for homes in the Phoenix real estate market has been particularly strong in 2009. The demand is due in part to the low prices of foreclosure homes for sale, low interest rates, and the home buyer tax credit. According to CromfordReport.com (who does extensive reporting on the Phoenix real estate market and homes for sale):

The big news in our pending home sales situation is the dramatic contrast with the national picture. The NAR today released the news that pending listings for home sales were 19.8% higher than a year ago. For Greater Phoenix real estate the equivalent increase is currently 102%. In fact a few days ago on October 30 we set an all time record of 107%. Demand is clearly at an exceptional level for real estate.

The increase in the number of homes for sale is a normal seasonal pattern in the Phoenix real estate market and does not indicate a significant change. If normal annual trends continue, the active listing count will peak in November and then decline toward the end of the year. I will post about November real estate sales in the next few days.

Phoenix real estate

Phoenix housing market

2009 to be 3rd best year in last decade for Phoenix homes for sale

2009 is in position to be the 3rd best year in last decade for Phoenix homes for sale. The housing market forecast in the Phoenix area is looking very promising going into 2010. As of November 12, over 79,500 residential home sales have been completed in the metropolitan Phoenix area. Homes sales should easily reach 90,000 by the end of December. The only years that were better were the boom years of 2004 and 2005.

Housing sales in 2007 and 2008 averaged 56,754 residential homes. 2009 home sales will be an estimated 58% higher than in the two previous years. We can clearly signal the end of the buyer's market in the Phoenix area.

There were plenty of doomsayers to begin this year. The Phoenix housing market forecast was uncertain and many home buyers debated what to do. Continuing lower prices and the first-time home buyers tax credit helped people to a decision. It was also very helpful that mortgage interest rates stayed very low.

Search Phoenix area homes for sale

Phoenix Area Home Sales Increase Slightly in October 2009

Phoenix Area Home Sales Increase Slightly in October 2009

The increase was slight, but October 2009 home sales in Phoenix surpassed those of September by about 200 sales. These numbers continue to be evidence of confidence from buyers looking for homes in the Phoenix area.
The confidence can be attributed lower housing prices and the first-time home buyers credit. It also helps that the number of active listings in Phoenix has remained stable thereby keeping the balance between a "buyers" and "sellers" market in check.

This is great news for the housing market in Phoenix. Increased sales always stimulates the overall economy. People who have "gotten off the fence" and contributed to Phoenix home sales are making this the 3rd best sales year in the last decade.

As seen in the charts, 8,145 homes sold in October of 2009. Only four months had higher sales in the Phoenix area. It is also important to note that in the previous two years home sales were already tapering off by October. However, Phoenix area sales over the last three months have been stable.

if you are comfortable with housing prices, president Obama's policies, and interest rates -- this may be your time to consider homes for sale in the Phoenix area.

$8000 / $6500 Home Buyer Tax Credit is alive and well

The $8000 / $6500 Home Buyer Tax Credit is alive and well. As anticipated, President Obama signed the $8,000 first-time home buyer tax credit extension into law on Friday. You can now collect the credit if your home purchase is under contract by April 30, 2010 and is complete by June 30, 2010. The good news for current owners: The extension also offers a tax credit for people who are purchasing a new residence, but aren't first-time homeowners.

Tax Credit is Refundable

A refundable credit means that if the amount of income taxes you owe is less than the credit amount you qualify for, the government will send you a check for the difference.

For example:

• A first-time home buyer who qualifies for the full $8,000 credit who owes $4,000 in federal income taxes would pay nothing to the IRS and receive a $4,000 payment from the government
• A first-time home buyer who was to receive a $3,000 refund would receive $11,000 ($3,000 plus the $8,000 first-time homebuyer tax credit)
• A repeat buyer who owes $4,000 would pay nothing to the IRS and receive $2,500 back from the government
• A repeat buyer who was due to get a $2,000 refund would get $8,500 ($2,000 plus the $6,500 repeat buyer tax credit)

All qualified homebuyers can take the tax credit on their 2009 or 2010 income tax return.

Payback Provisions

The tax credit is a true credit. It does not have to be repaid unless the home owner sells or stops using the home as their principal residence within three years after the purchase.

Summary Details of TAX CREDIT:

• Under contract by April 30, 2010
• Close escrow by June 30, 2010
• $8,000 for 1st time buyers
• $6,500 for current homeowners who have lived in their house 5 of the past 8 years
• $125,000 individual income limit
• $225,000 joint income limit

History of the $8,000 tax credit
Detailed Tax Credit Explanation
IRS Rules about the $8,000
Calculating the Tax Credit
Put the $8,000 tax credit on line 69 of this form

Frequently asked questions about the home buyers tax credit

Selecting the Best Arizona Mortgage Company

Selecting the Best Arizona Mortgage Company

How to do it right:

Use these questions to determine the expertise of Arizona Mortgage Lenders. The largest financial transaction of your life is too important to risk with someone or a company who is not capable of advising you properly on the best options for your specific mortgage loan situation. But how can you tell?

Here are four simple questions your Arizona Mortgage Company absolutely must be able to answer correctly. If they do not know the answers, run -- don't walk -- to a lender who does.

1. What are interest rates based on?
   
   The only correct answer is Mortgage Backed Securities or Mortgage Bonds, NOT the 10-year Treasury Note. The 10-year Treasury Note sometimes trends in the same direction as Mortgage Bonds. It can also move in completely opposite directions. DO NOT work with Arizona lenders who have their eyes on the wrong indicators.
2. What is the next Economic Report or event that could cause interest rate movement?
   
   Professional lenders will have this information at their fingertips. Ask about a current calendar of weekly economic reports and events that may cause rates to fluctuate.
3. When Bernacke (formerly Greenspan) and the Fed “change rates”, what does this mean...
   
   ...and what impact does this have on home loan interest rates? The answer may surprise you. When the Fed makes a move, they are changing a rate called the “Fed Funds Rate”. This is a very short-term rate that impacts credit cards, credit lines, auto loans and the like.  Interest rates most often will actually move in the opposite direction as the Fed change, due to the dynamics within the financial markets. For more information and an explanation on how this affects your lending situation, just give us a call.
4. What is happening in the market today and what do you see in the near future?
   
   If a lender cannot explain how Mortgage Bonds and interest rates are moving at the present time, as well as
   
   what is coming up in the near future, you are likely NOT talking to a professional lender or lending company. Be smart... ask questions… get answers!

This is one of the largest and most important financial transactions you will ever make. You may take this voyage only two - five times your entire life. Professional mortgage lenders cruise these waters every single day. It’s your home and your future in Arizona. Place them in the hands of a professional loan officer and Arizona Mortgage Company.

Thanks to my good friend and trusted lender, Craig Bohall, for helping to put these words onto virtual paper.

Understanding the Mortgage Loan Process

Help with Phoenix Homes for Sale and the Mortgage Lending Processs

Phoenix foreclosures snapshot to begin November 2009

Phoenix Foreclosures Snapshot - November 2009

Phoenix foreclosures comprise 30.8% of all real estate listings in the metropolitan area. Foreclosure listings are comprised of REO property (bank owned) and short sales. REO property used to be the majority of active listings in the foreclosure arena. However, bank owned properties have been on a decline for most of 2009. They are being replaced by short sales because more distressed homeowners are seeing short sales as a better alternative to foreclosure.

The chart indicates 12,539 foreclosure listings in the Phoenix real estate market to begin November 2009. Since there are 32,351 total listings in the Phoenix market (seen in my last post), foreclosure listings make up almost 39% of all listings in the area. Of that 39%, 35.2% (4,417) are REO listings and 64.8% (8,122) are short sales. There are several reasons for the decline in REO property listings over the last year:

• the federally mandated foreclosure moratorium
• banks for selling more properties in bulk to large-scale investors
  
• banks are taking chunks of foreclosure properties and turning them into rentals
• more properties are being sold at public-type auctions

Homeowners are increasingly seeing short sales as a viable alternative to foreclosure. Although the short sale process can take between three and five months to complete, buyers in the Phoenix area real estate market are paying much more attention to short sales. The percentage of completed short sale transactions continues to grow each month in the Phoenix area.

Days on Market for Phoenix Foreclosures

Foreclosure listings have been on the market for an average of 80 days less than their counterparts -- "normal" listings -- during 2009. The second chart indicates that current foreclosure-type listings have been on the market for 105 days, while normal listings have been on the market for 182 days. The obvious reason is the difference in price between two categories of listings. REO property and short sales are always priced much lower than normal sales making them much more attractive to home buyers.

It can also be seen by the chart that overall days on the market has been steadily trending downwards for Phoenix area foreclosures. However, if we were to isolate REO properties we would find that the average sold home would be on the market for less than 60 days. The longer selling cycle for short sales is what keeps the foreclosure "days on the market" higher.

Short sale your home

Homes for sale in Phoenix increase slightly to begin November 2009

Homes for sale in Phoenix increase slightly to begin November 2009

MLS listings in the Phoenix area were up slightly for the second consecutive month to begin November 2009 (highlighted in orange).  This is a contrast to the previous nine months when active homes on the market dropped a whopping 23,500 properties from 54,538 in December 2008 to 30,995 in September 2009 (highlighted in yellow). There are currently 32,351 active residential listings in the Phoenix area real estate market.  This includes both "normal" and foreclosure homes for sale.

This slight increase in homes for sale will do little to impact the demand in our current real estate market, especially for foreclosures. The Phoenix real estate market has averaged about 8,700 home sales in the six-month period from April through September 2009. Phoenix home sales for October are expected to be right around 8,300 properties. Much of this demand in Phoenix is due to affordable home pricing and the $8,000 tax credit. The $8,000 tax credit is currently set to expire at the end of this month, but the federal government is evaluating extending it into 2010.

Phoenix Area Foreclosures

The number of Metro Phoenix foreclosures increased to begin November 2009. The total increase was about 550 homes.  This includes both real estate short sales and REO property (bank owned homes).  Look for the number of foreclosures to increase further as short sales continue to be increasingly popular and banks have inventory they have yet to release.  The chart indicates approximately 38% of all active homes for sale over the last six months have consisted of foreclosure-properties (highlighted in blue).

My next post will look deeper into the foreclosure market and compare the number of short sales versus the number of bank owned properties currently for sale in the Phoenix real estate market.

Learn about the short sale process

Maricopa homes for sale in Tortosa - 2787 sq ft Short Sale

Welcome to another in a series of video tours brought to you by ValleyWideHomes.com and Metro Phoenix Homes LLC. Today's tour focuses on Maricopa Homes for Sale and brings us to the subdivision of Tortosa in the Town of Maricopa.  Maricopa is approximately 30 miles south of Phoenix Sky Harbor Airport, but only 20 miles south of the Phoenix Township of Ahwatukee, Arizona.

Maricopa rapidly changed from a rich agricultural area to vibrant and exciting new city with master planned communities.  On average, there were just under 700 active homes for sale in Maricopa during each month of 2009. Maricopa calls itself "a city with something for everyone and opportunities for all where a handshake is still honored, community involvement is welcomed, and a small town feel is ever present."

The subdivision of Tortosa is heralded by a dramatic entryway as well as several common areas with large and expansive views. Today we will be visiting a home for sale in the subdivision of Tortosa that first became available in November of 2009.

Built by Shea Homes in 2006, this home sits on an a corner lot that's just over one quarter acre. If you're interested in more information about this Maricopa home for sale --  contact information will be provided at the end of the video as well as in this blog.  This house has 2,787 square feet with three bedrooms three full bathrooms a living room, family room, a three-way fireplace, dining room and a two-car garage.  But there's MORE. Watch the video and learn about the three bonus rooms. Let's have a look at this Maricopa home for sale in Tortosa...

Learn about the Real Estate Short Sale Process

"How can I improve my credit score fast"- a common question | mortgage series Part 5

"How can I improve my credit score fast?" -- Arizona mortgage company helps  provide an answer

This is part five of a five-part series on the mortgage lending process. In the first 4 parts of this series Arizona  loan officer Craig A. Bohall took us on a journey that began with an introduction to the mortgage process, followed by "thinking like an underwriter" to get your loan approved, the "4 C's" of mortgage lending (with a 5th "bonus C"),  the important " when do I lock my interest rate," and finally In part  5 Craig will talk about what's on many people's minds: "how can I improve my credit score fast?"

Credit repair is not something that can be accomplished overnight.  If you are applying for a loan from an Arizona  mortgage company  there are certain things you should understand.  Craig will take you on a video tour and provide tips on improving your credit to help you get a mortgage loan.

Credit repair will help you in the mortgage lending process.  Credit is made up of five primary categories:

1.  payment history
   
2.  amounts owed
   
3.  blanks of credit
   
4.  new versus old credit
   
5.  types of credit

This video will help you start the process of repairing your credit that you can purchase a home.

An introduction from the first video in the series:

My primary lender, Craig Bohall with Academy Mortgage, and I decided it was time to produce a series on the mortgage lending process.  There are many mortgage companies and lenders on the scene, and it's important for buyers (especially first-time buyers) to understand the  lending process.

We used Craig's lending experience and my video camera / production knowledge to produce a five-part series on the lending process. Craig has been involved in the real estate industry for 15 years, but he specifically has been a loan officer for the past eight years.  Craig has worked for several Arizona mortgage companies and has found a home at Academy Mortgage.  I would highly recommend Craig if you are looking for a real estate loan in the state of Arizona.  Picking the wrong mortgage company can cause a lot of grief.

  Still wondering "how can I improve my credit score fast?"

Part 4 of the series

Entire Series

Get a Mortgage Loan Approved

Should I refuse this Chase short sale listing?

Am I wasting everyone's time if I accept this Chase short sale?

The seller has a first and second mortgage with Chase. Both mortgages are purchase money mortgages. The would-be sellers tried doing a loan modification over the summer but they gave up because the result of the loan modification was a "higher" monthly payment. Go figure that one. My potential clients did not make their July 1st payment after the loan modification failed. However, they waited until one week ago to ask me to short sale their house. Take note of the fact that the loan is 149 days past due.

I received authorization to talk to Chase about the potential short sale yesterday. Fortunately, and because the sellers tried a loan modification, Chase never sent a notice of default and there are no foreclosure proceedings in process. The first mortgage would not talk to me about the second mortgage and sent me on a long hunt to find the correct number to talk to the second mortgage department. Here is what I found out after six phone calls/transfers:

• the "home equity collections department" handles the second mortgage until it is 119 days past due
• the second mortgage was still residing in the home equity collections department because of the attempted loan modification
• my phone call brought attention to the fact that the loan modification process is over and my potential clients are simply delinquent
• the home equity collections department will no longer talk to me because the delinquent loan is past the 119 day marker
• they said the account was being sent to the "recovery" department (oh oh) as of November 1
  

I was able to talk to the recovery department about the prospect of a short sale. The recovery department, which of course is not nearly as much fun as the collections department, was much more serious about the matter. Here I was told that the focus of this department was to recover as much of the $52,000 balance as possible. I was told they would start out by asking for between 50 to 60% of the balance to approve the short sale.

I don't know my sellers very well, but I do know that proposition doesn't stand a chance. Faced with such a large amount, my sellers would forego the short sale process and let the property go into foreclosure. After reminding the person in the recovery department that Arizona is a non-deficiency state -- and that there was no real benefit to Chase in letting this go to foreclosure -- the person on the other side of the phone gave me these options:

1. convince my potential client to bring some money to the table
2. Hope that the first mortgage (held by a different department of Chase) would do more than allocate the standard $3000 to the second mortgage; this "recovery department" person suggested that perhaps the first mortgage Department of Chase could allocate $20,000 -- $25,000 to the second mortgage Department to make a short sale work

I reminded this person that no one wanted to waste their time by taking a potential buyer through the short sale process and then finding out that the second mortgage Department (excuse me -- the recovery department) would nix the sale. I also reminded him that both departments were in the same company and that he was simply talking about an exercise in accounting.

This recovery department person seemed to be unfazed. He suggested that I take the short sale listing, find a buyer, present the contract and short sale package to Chase and "see what happens."

I really don't consider this to be "profound" or worthwhile advice.

Anyone have any experience with this situation and Chase (JP Morgan)?

Understanding the short sale process

Phoenix area homes for sale

$8,000 Tax Credit Fraud Under IRS Scrutiny

$8000 Tax Credit Fraud under IRS Scrutiny

According to the Wall Street Journal, the IRS is reportedly examining more than 100,000 suspicious claims for the $8000 dollar tax credit and is investigating 167 "criminal schemes" involving the credit. IRS officials declined last week to describe the suspected schemes or provide additional details. However, they did say they have identified the different types of potential fraud and matched them against their compliance program.

We could speculate about how people are trying to commit fraud with the $8000 tax credit.  Perhaps they are modifying closing statements, commonly known as HUD-1's to make it appear the house was purchased in the correct tax year. Perhaps they are taking incorrect tax advice from their accountants.  Perhaps people are modifying HUD-1's to make it appear that they bought a house -- when in fact they did not. Regardless, the IRS taking it very seriously.

The IRS says it has received more than one million claims for the $8000 tax credit.  Housing industry experts estimate the credit helped to generate at least 350,000 additional home sales. The $8000 tax credit to set to expire on November 30, 2009 but leaders in the housing industry are lobbying Congress to extend it.

It would seem that widespread abuse would be relatively easy because of the loose standards for claiming the credit. In other words, the IRS never set anything in place with title and escrow companies to document the tax credit at time of sale.  Free money has had a history of attracting people with dishonest intent, and $8,000 is a good deal of money. This is just the kind of trouble that will delay or eliminate the proposed extension of the program, or even it's conversion to the much talked about "$15,000 tax credit."  It's always sad when dishonest people potentially destroy a good program they can benefit the masses.

On the other hand, does our country really need an extension of the $8000 credit, or even a new $15,000 tax credit?  Has our country, which already has enough debt to choke 20 medium-sized countries, need to be giving out more money it doesn't have?  It does seem that many citizens have developed an attitude of "entitlement" and expect the government to just keep giving out more and more money. But I digress...

According to the IRS website , the IRS successfully prosecuted its first fraudulent tax credit case in July 2009. A Jacksonville, Fla. tax preparer, James Otto Price III, pled guilty to falsely claiming the $8000 tax credit on a client’s federal tax return. Price faces the possibility of up to three years in jail, a fine of as much as $250,000, or both.

A quote from the IRS's website:

“We will vigorously pursue anyone who falsely tries to claim this or any other tax credit or deduction,” said Eileen Mayer, Chief, IRS Criminal Investigation. “The penalties for tax fraud are steep. Taxpayers should be wary of anyone who promises to get them a big refund.

Metro Phoenix homes for sale

Get your mortgage loan approved

Mortgage Lending Process| Arizona Mortgage Loan |Part 4

Mortgage Lending Process| Arizona Mortgage Loan

This is part four of a five-part series on the mortgage lending process to educate and inspire potential homebuyers.  In the first three parts of this series Arizona mortgage broker (turned banker) Craig A. Bohall took us on a journey that began with an introduction to the mortgage process,   followed by "thinking like an underwriter" to get your loan approved, and finally the "4 C's" of mortgage lending (with a 5th "bonus C"). In part 4 Craig will talk about the most important topic to date: when to lock your interest rate on your Arizona mortgage loan. 

Do you want to appear like a knowledgeable consumer? What questions should you ask when applying for an Arizona mortgage loan? What questions make you look like a "novice" when speaking to a mortgage broker? Here is a sample of the wrong questions to ask when interviewing a potential mortgage company:

• what are the interests rates today?
• what kind of interest-rate can your company give me?

Here is the right question to ask:

• what are the markets doing today?

Watch this video and learn what your mortgage broker should know about interest rates. Beware of any loan officer in an Arizona mortgage company who is not aware of (or can not talk about)  jobless claims, the consumer confidence number, unemployment numbers, or when the Federal Reserve Chairman and Board of Governors are meeting.

Watch this video and learn the basics about the markets and economic indicators that affect interest rates. But don't be concerned -- you don't have to be an expert mortgage broker to get the best interest rates.  You simply simply need to find an expert in the mortgage lending process who will guide you through the intricacies of obtaining a mortgage loan and locking your interest rate at the correct time.

An introduction from the first video in the series:

My primary lender, Craig Bohall with Academy Mortgage, and I decided it was time to produce a series on the mortgage lending process.  There are many mortgage companies and lenders on the scene, and it's important for buyers (especially first-time buyers) to understand the  lending process.

We used Craig's lending experience and my video camera / production knowledge to produce a five-part series on the lending process. Craig has been involved in the real estate industry for 15 years, but he specifically has been a loan officer for the past eight years.  Craig has worked for several Arizona mortgage companies and has found a home at Academy Mortgage.  I would highly recommend Craig if you are looking for a real estate loan in the state of Arizona.  Picking the wrong mortgage company can cause a lot of grief.

Part 3 of the series

Get a Mortgage Loan Approved

Tempe Town House Rental

Tempe Town House Rental in Broadmor near ASU --

Beautiful and spacious 1,760 sq. ft. Tempe town house with 2-car garage
is ready to be your next rental. The kitchen in this house is gorgeous
and newly remolded with cherry wood cabinets. Town house is an ideal
rental bacause it has 3 bedrooms and 2.5 bathrooms.

Tour this Town House Rental

The master bedroom
is large with a vaulted ceiling, fireplace, wonderful placement of
windows, and a large walk-in closet. This Tempe house rental has a big
2nd bedroom with a large walk-in closet and Jack & Jill bathroom.
3rd bedroom has a balcony.

Ready to move in! All appliances come with
this house to include: washer/dryer, range/oven, refrigerator/freezer,
and dishwasher. All appliances in this Tempe rental house are in good
condition. New carpet upstairs and tile throughout downstairs. Cable
and phone wired in all 3 bedrooms and downstairs. This Tempe town house
rental overlooks a new pebble-tech pool-just footsteps away.

Centrally
located and just minutes from Tempe Town Lake, ASU, shopping, downtown
Tempe and Mill Ave. Hurry- this rental will go
quickly! Rental available for move in Nov. 1, 2009. $1,350 monthly
rental includes all HOA fees, including COX cable. Call Ron Wilczek,
designated broker, Metro Phoenix Homes, 480-445-9480 to make this Tempe
town house your next rental.

ValleyWideHomes.com     Arizona mortgage company      Tempe Arizona homes for sale

Arizona Mortgage Company Lending Process | Part 3

Arizona Mortgage Company talks about the lending process

This is part three in a five-part series that explains what you should know as a potential homebuyer about obtaining a mortgage loan.  In this video you will hear a detailed account of how to successfully obtain a loan in Arizona and pick the right company for you.  Part one of this series was an overview of the mortgage lending process and part two provided some insightful comments about how to get your loan approved by "thinking like a mortgage company underwriter."

This video  will discuss the four "C's" lenders evaluate when you apply for a mortgage loan in Arizona (and throughout the country). Here's a quick preview of the four C's:

1. credit - a look into credit and how your payment history comes into play during the mortgage process
2. capacity - essentially your ability to cover your debt
3. cash - how much do you have and what the loan underwriter sees when evaluating your finances
4. collateral - this is essentially the value of the house you want to buy

Don't miss the bonus footage on the "5th C" that you rarely hear about.  The 5th "C" can have a dramatic impact on your ability to qualify for a mortgage loan in Arizona.  Make sure the Arizona mortgage lenders you interview are aware of how to use these criteria to ensure your best chance at getting a loan and purchasing your dream house.

An introduction from the first video in the series:

My primary lender, Craig Bohall with Academy Mortgage, and I decided it was time to produce a series on the mortgage lending process.  There are many mortgage companies and lenders on the scene, and it's important for buyers (especially first-time buyers) to understand the  lending process.

We used Craig's lending experience and my video camera / production knowledge to produce a five-part series on the lending process. Craig has been involved in the real estate industry for 15 years, but he specifically has been a loan officer for the past eight years.  Craig has worked for several Arizona mortgage companies and has found a home at Academy Mortgage.  I would highly recommend Craig if you are looking for a real estate loan in the state of Arizona.  Picking the wrong mortgage company can cause a lot of grief.

Part 2 of the series

Get a Mortgage Loan Approved

Arizona Mortgage Lenders | Lending Process Part 2

Arizona Mortgage Lender talks about the mortgage loan process

This is part two in a five-part series that explains what consumers should know about obtaining a mortgage loan.  In this installment you will hear what it takes to get a loan approved from a lender.  Do you know one of the best secrets to getting a loan approved? Think like a mortgage company underwriter.

Although your Arizona mortgage lenders are your point of contact, the investor's underwriter has the final say on whether or not your loan will be approved.  It's important to know that underwriters get paid to "smell risk." What kinds of risks do the underwriters look for in the mortgage lending process:

• The most obvious is probably the borrowers credit; that's the most basic place for any underwriter to start.
• What about your job history? Do you change jobs like you change underwear, or are you a stalwart company veteran, or are you somewhere in between?
• Hear Craig talk about more important factors that go into the underwriter's approval process.

A good loan officer will make sure your loan application doesn't have the smell of risk in it.

An explanation from the last post:

My primary lender, Craig Bohall with Academy Mortgage, and I decided it was time to produce a series on the mortgage lending process.  There are many mortgage companies and lenders on the scene, and it's important for buyers (especially first-time buyers) to understand the  lending process.

We used Craig's mortgage lending experience and my video camera / production knowledge to produce a five-part series on the lending process. Craig has been involved in the real estate industry for 15 years, but he specifically has been a loan officer for the past eight years.  Craig has worked for several Arizona mortgage companies and has found a home at Academy Mortgage.  I would highly recommend Craig if you are looking for a real estate loan in the state of Arizona.  Picking the wrong mortgage company can cause a lot of grief.

Part 1 of the series

Get a Mortgage Loan Approved

Arizona Mortgage Company | Loan | Process Part 1

Arizona Mortgage Company talks about the mortgage lending process

My primary lender, Craig Bohall with Academy Mortgage, and I decided it was time to produce a series on the mortgage lending process.  There are many mortgage companies and lenders on the scene, and it's important for buyers (especially first-time buyers) to understand the mortgage lending process.

This introductory video will give a "birds eye view" of obtaining a mortgage loan, whether it be in Arizona or elsewhere.  Many times a buyer doesn't get all the information that he or she requires because they don't know how to ask the right questions.  Perhaps the mortgage lender/company assumes the buyer knows certain facts about mortgage lending that the buyer really doesn't even have a clue about. I think that happens in all industries -- the industry professional knows so much about the industry and sometimes assumes it's common knowledge. So we used Craig's mortgage lending experience and my video camera / production knowledge to produce a five-part series on the mortgage process.

Craig has been involved in the real estate industry for 15 years, but he specifically has been a loan officer for the past eight years.  Craig has worked for several Arizona mortgage companies and has found a home at Academy Mortgage.  I would highly recommend Craig if you are looking for a mortgage loan in the state of Arizona.  Picking the wrong mortgage company can cause a lot of grief. In future series Craig explains many topics  that are important to the mortgage process.

The Arizona real estate market is volatile enough.  The last thing you need is to work with an Arizona mortgage lender that is not experienced and doesn't know how to watch the key indicators when locking a mortgage rate. We hope you enjoy these videos.

Mortgage Loans in Arizona

September 2009 Phoenix home sales keep pace with August 2009 - foreclosures still dominate

September 2009 Phoenix home sales keep pace with August 2009 - foreclosures still dominate

Of the almost 31,000 Phoenix homes for sale, 7,942 homes were sold in the metropolitan Phoenix area in September 2009. That's 97 homes less than the total sold in August. A majority were Phoenix foreclosure type properties. 2009 has been a very good year for homes sales in the Valley of the Sun. At current sales levels, I expect to see approximately 90,000 homes sold in the Phoenix area for 2009, making it the third best sales year for housing in the last decade. As of this writing, 72,451 homes have been sold in and around Phoenix. The only two years with more home sales were the “boom” years of 2004 in 2005 -- with 98,100 and 104,000 sales respectively. The next closest year was 2003 with 79,500 sales.

It seems clear that the Phoenix foreclosure market, the $8,000 tax credit, low interest rates, and the overall affordability of Phoenix area homes has done much to stimulate sales. This post is not about whether or not the $8,000 tax credit is spoiling the Americans into a feeling of entitlement. It is simply reporting on the sales trends in the Phoenix area and confirming that local residents have cast a vote of confidence in returning to the home market. Having said that, it must also be noted that some figures indicate that approximately 30% of all Phoenix home sales in 2009 were from investors.

Foreclosures continue to dominate Phoenix area sales

67% of all home sales in the Phoenix area during September 2009 were foreclosures, foreclosures being either REO property (bank owned homes) or real estate short sales. This has been a trend in the Phoenix area for the last year.

October 2008 was recorded as the first month that foreclosure sales exceeded 50% of total sales. Foreclosure sales increased from 51.4% in October to a high of 75.9% in March 2009. The decrease in REO property (bank owned homes) has been a significant factor in the gradual reduction of foreclosure sales beginning in April 2009. My post in the next few days will show that Phoenix foreclosures are increasingly being affected by real estate short sales, a trend barely noticeable 12-18 months ago. Short sales deserve a look if you are considering making a purchase from the inventory of Phoenix homes for sale.

Mesa Homes for Sale - Augusta Ranch

Ron Wilczek, Broker/Owner
Metro Phoenix Homes
480-445-9480

Market conditions for the Phoenix area	Foreclosure trends around Phoenix	Search Tempe homes
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Mesa Arizona Real Estate - Augusta Ranch

Mesa Arizona Real Estate - Augusta Ranch
Today we visit the Master Planned community of Augusta Ranch, located near the intersection of Interstate 60 and the loop 202 freeways, but more specifically just south of the crossroads of Ellsworth and Baseline Roads. Augusta Ranch is a golf course community that features an 18-hole, 3,800 yard, par 61 golf course that offers discounts to residence of the community. The facility has a large outdoor pavilion with seating for up to 120 people for weddings or special events. These are all desirable ammenities for Mesa Arizona Real Estate.
The community of Augusta Ranch offers some beautiful scenic views, as well as common areas with ramadas for family picnics, two volleyball courts, two basketball courts and a community pool -- depending on your individual community.
Augusta Ranch is is made up of over 15 subdivisions (or parcels). Most homes are single-family residences ranging from 1,200 sq ft in Parcel 11 up to 4,200 sq ft in Parcel 13.
Park Central at Augusta Ranch is a community built by a division of Trend Homes called Classic Communities. Though legally classified in Mesa Arizona Real Estate as condominiums, these are unique two and three story homes. Some have their own separate structure, while others are two homes in one structure sharing a common wall. Because they are technically different from condominiums and town homes, classic communities coined the phrase "Gemini twin homes" (this term is found in the MLS when searching Mesa Arizona Real Estate). The home is this video is 1,550 sq ft. model has a two-car garage and 1 bedroom - complete with bathroom - on the first floor. The second floor contains the kitchen, living room, the 2nd bedroom, and a bathroom. The 3rd story is the master bedroom and bathroom. Classic Communities developed a unique floorplan for this area and Mesa Arizona real estate.



On the northern edge of Augusta Ranch there are two 6 acre, neighborhood shopping centers complete with major grocery stores, restaurants, and specialty stores. You'll never be more than a few minutes away from the necessities of daily life if you live in this Master planned community. 1 mile to the east of Augusta Ranch is the 22 acre, superstition Gateway Center that includes major stores like Wal-Mart, Best Buy, Kohls, and Ross, to name a few. 3 miles to the west of Augusta Ranch is the 18 acre, regional shopping center known as Superstition Springs Mall. National retail stores and restaurants are found in abundance. These are desirable community amenities when it comes time to resell your Mesa, Arizona real estate.
If you are considering a move to East Mesa and Mesa Arizona Real Estate, Augusta Ranch is worth a look.
Active homes for sale in the October 2009 Phoenix area
See Mesa Homes for Sale

"Active" homes for sale in Metro Phoenix remain consistent - October 2009

The total number of "active" homes for sale in Metro Phoenix remained consistent at just over 31,000 homes for the fourth month in a row. As the chart indicates, that's 20,000 homes less then we experienced during 2008 and all the way up March 2009.


The number of active foreclosure listings has also been steady at just under 12,000 homes over the last four months -- after reaching a high of over 22,000 homes for sale in the Phoenix area in February 2009.

Metro Phoenix foreclosures have accounted for the majority of home sales over the last 12 months, reaching as high as 75.9% of all Metro Phoenix homes for sale in March 2009. Those figures will be updated in the next few days on this blog. The foreclosure market has severely impacted the Phoenix area and the prices of all homes for sale.

Distressed Markets and private mortgage insurance

Distressed Markets and private mortgage insurance

co-authored by my mortgage guy, Craig Bohall, Academy Mortgage

Have you ever wanted to know who decides what "distressed markets" are and what is not distressed? Well here is your chance to see a map.

Who is the "all knowing wizard" who determines that? Well for the most part it is the Mortgage Insurance (MI) companies. Fannie Mae and Freddie Mac also have their own lists. When a home gets sold at the trustee's sale, the Mortgage Insurance company likely had a policy on that home and, thus, they paid out on that policy. So imagine how many pay outs they have had in the last several years.

Guess how many they are planning on having the next few years? That's right -- their goal is "zero" mortgage insurance payouts! So in order to minimize risk and maximize profits they don't want to give mortgage insurance to loans that they feel might be risky for THEM.

What makes a loan risky you ask.... could be 1.) an investor loan rather than an owner occupied loan, 2.) a manufactured home rather than a "stick-built" one, 3.) a second home, 4.) any higher "loan to value" loans and, 5) a loan in a HIGH foreclosure area. Regarding the latter, they decided they would determine which areas had more losses and call those areas high risk or "distressed markets." Other factors go into it like % of price deterioration and % of REO's to resales and such, but all in all - distressed markets - is pretty self explanatory.

The good news is when you click on this map it is not one solid color - YES, it was at one time. People used to ask me what areas are distressed and I basically said "South of Canada and North of Mexico!

Now click on this Map of distressed markets in the US to see what areas they have deemed to be distressed. If you are buying in those areas then having mortgage insurance is going to be less available - or in other words - there will be a much bigger list of loans for which they DON"T want to give mortgage insurance.

To see that list of loans not eligible for Mortgage insurance click here. The interesting thing about this list (at the top of the page) is that a few years ago all, or most, of those items COULD have mortgage insurance. So now you can see what they consider to be risky. Basically everything except 20% down!

Phoenix area top 10 places to start a business

Phoenix homes for sale ranked 21st most affordable in Metro area

Phoenix homes for sale ranked 21st most affordable at $78 per square foot in Metro area

This table ranks Metro Phoenix cities and their corresponding homes for sale by their annual average sales price per square foot. Only single family detached homes are included in these numbers. Information for major and secondary cities is current as of September 30th, 2009. Data for the small cities is updated on a monthly basis, and is measured on the 13th of each month. As you can see, Phoenix homes for sale are more affordable than those in many surrounding communities.

The primary function of this table is to show the least and most affordable homes for sale in the Phoenix metropolitan area together with longer term pricing trends.

Annual averages are based on a relatively large number of sales. Therefore they are not as subject to rapid change as monthly averages. The downside is that they do not necessarily represent the "current" market (or market right at this moment on 9/30/2009) very accurately, since they include sales from up to a year ago. Pricing may have moved a great deal since then. However, the information is consistent for all homes for sale in the Phoenix area and will give good trending information.

Note that Higley has been included in Gilbert and Ahwatukee included in Phoenix. Desert Hills is still counted separately though it is increasingly being incorporated into Phoenix.

Note that Phoenix is second only to Tonopah Arizona with the largest year over year (YOY) decrease in average price per square foot for all homes for sale in a range that extends from $337 to $59 per square foot.This can be attributed to the large number of new home communities built in west Phoenix over the last seven years, complete with all of the bad financing and other troubles that led to the classic foreclosure profile we have now come to know.

Statistical Information courtesy of the CromfordReport.com

Greater Phoenix Area named Best Place to Start a Business by Entrepreneur.com

Greater Phoenix Area named Best Place to Start a Business by Entrepreneur.com

Entrepreneur Magazine ranked the Greater Phoenix Metropolitan Area as one of the 10 Best Places for an investment to start a business in its August issue. The growth of the area for the last 20 years has led to a need for many kinds of business, according to the publication. The writer also indicates that an emerging tech scene and coordinated revitalization efforts are attracting more startup and tech-savvy business. Even in this economy there are opportunities for investment. Read more: http://www.entrepreneur.com/magazine/entrepreneur/2009/August/202666-1.html


Entrepreneur, an online and print small business publication, provides information to help people start, grow or manage a small business. Entrepreneur.com is a top 5,000 site that reaches more than1.2 million people monthly, according to Quantcast.com.

Could buying Metro Phoenix foreclosures get easier? 15 day "First Look" program

Could buying Metro Phoenix foreclosures get easier? 15 day "First Look" program

My trusted Phoenix area loan officer, Craig Bohall, Academy Mortgage, craig@myazmp.com alerted me to this. Simple answer: HECK YES -- if we could cut out the government's addictive overdosing of regulations that have been piled on like a 7 layer bean dip. But, since that is not going to happen any time soon we can take joy in small victories like this 15 day "First Look" program.

The government-run Fannie Mae has come out recently with a plan to keep investors away from their foreclosures for 15 days and allow the average Joe/Jane a first look and opportunity to get in their offers before investors. A reporter from the AZ Republic (serving the Phoenix area) had this to say regarding this announcement...

"Arizona home buyers trying to tap federal funds to help them purchase foreclosure homes might find it a little easier now. Mortgage giant Fannie Mae recently launched a program called “First Look” that bars investors for bidding on its foreclosures for the first 15 days they go on the market. In metropolitan Phoenix, first-time buyers typically lose out to investors on the best foreclosure homes. "

To read Catherine Reagor's full story click here http://www.azcentral.com/members/Blog/CatherineReagor/63525.

Is this good or bad? Well depends whether you are Joe Average or Jane investor buying Phoenix foreclosures doesn't it? On the one hand poor Joe Average was previously getting beat out on the 60K home in Phoenix when he offered 62K. That's because a cash investor was there who could close in 48 hours while the Joe Average will need 30 days to close through his lender. On the other hand, without Jane investor helping to stop prices from falling and even create some bidding wars for Phoenix foreclosures we could be left to the pricing "mud-slide" we saw for months on end!

On the one hand, Jane investor can buy 20 Phoenix foreclosures and Joe Average can only buy one foreclosure, so who is helping the economy and helping to reduce inventory more? But we Americans sooooo love to find something that seems unfair and get the government to regulate it.

But on the other hand, if the government is going to give federal funds ONLY to Joe Averages (no investors) they should have some say in letting Joe Average "to the dance" 15 days before investors swarm in on Phoenix foreclosures and give Joe Average a first look.

Yet, on the other hand, if they let free market principles work the highest bidder gets the foreclosures. Maybe the investor wants a great deal and bids 60K while Joe Average out bids him with 65K or 69K. Would that make our housing market rebound and get normal sellers back in the market sooner? Will that allow the market to run on it's own again instead of this "propping up" that we have now.

However, on the other hand... I am out of hands. What do you think about the 15 day "First Look" program and it's effect on Phoenix foreclosures?

Understanding the short sale process

Read on Phoenix Homes for Sale

Help understanding the mortgage short sale process -- Part 5 of 5

DO MORTGAGE SHORT SALES REALLY WORK (ALSO SEE LEGAL IMPLICATIONS)

(HELP #12)

Part 4 of 5

We sometimes hear people say how the short sale process isn’t worth the time and rarely works. That is not our overall experience and we have several practices to help ensure a successful short sale process.

First, we prescreen all short sale information. This means collecting and reviewing the homeowner financials (including Hardship Letter) so there are no surprises in the process (like $20,000 sitting in the homeowner’s bank account). This also includes going over ramifications of the short sale process with the homeowner (i.e. possibility of a 1099C, a soft note on the 2nd and that any liens on the property will need to be paid). For example, if a homeowner has a home equity line of credit the mortgage lender will most likely ask for a “soft note” (loan for a portion of the balance with easy terms) to proceed with the short sale (more in HELP #13). It’s a big help to know upfront if the homeowner absolutely refuses to comply with such a short sale condition.

Second, we consistently follow up and nudge the mortgage lender(s) to move forward for a successful short sale process. We know lenders move slow with short sales, but when we find a short sale package has “disappeared” we move quickly and replace whatever they lost in the process. Consistent follow up is important when the short sale process is not moving forward in a timely manner with the mortgage lender(s).

Utilizing these practices will guarantee a much higher short sale success rate. We can attest to that!

BEWARE OF THE NON-PURCHASE MONEY SECOND MORTGAGE

(HELP #13)

If you decide to pursue a real estate short sale, be aware of the "non-purchase money" 2nd mortgage. A non-purchase money mortgage is one used for more than the purchase of the house. For example, a HELOC ( home equity line of credit) is a non-purchase money second mortgage. A HELOC may have been used to consolidate debt, take a vacation, or buy a new boat/car. In other words, the mortgage loan was for more than the house. In contrast, a purchase money second mortgage was taken out at the time of purchase process and used exclusively to buy the house.

Lenders holding the note for a HELOC are less likely to let the homeowner walk from the short sale process without repaying a portion of the loan. They know the homeowner will still enjoy the benefits of their debt consolidation, vacation, or new boat/car long after they sell their home on a short sale. Therefore, they feel the homeowner should take more financial responsibility. How? By signing a promissory note for up to one half of the second mortgage. Many times these promissory notes will be "zero" interest loans for up to 15 years to help the homeowner complete the short sale process.

Here’s the real problem: if short sale homework is not done up front to determine the intentions of the non-purchase money second mortgage lender and homeowner, we could find a short sale buyer only to learn the second mortgage requires a large promissory note. If the homeowner refuses to sign it the second mortgage holder will not sign off on the short sale process and the house will go to the trustee's sale.

LEGAL IMPLICATIONS OF THE SHORT SALE PROCESS

(HELP #14)

Consult an attorney/accountant for longer-term effects before completing a mortgage short sale. Although we are experienced short sale experts, we are not qualified to give legal or tax help associated with the process.

The IRS formerly considered debt forgiveness as income. However, legislation (October 2007) has reversed that rule. Additionally, ARS 33-729 and ARS 33-814 protect a homeowner from a mortgage lender deficiency if:

• the property is less than 2.5 acres
• is a 1-2 unit dwelling (dwelling means someone lived in the property)
• “purchase money” was used in the mortgage process
  
• the property is sold at the trustee’s sale (A BIG REASON TO APPROVE A SHORT SALE because if the mortgage lender rejects the short sale they cannot collect a deficiency)

Additionally, the IRS will not collect the ‘forgiveness’ tax if ANY condition applies during the year the forgiveness occurred (The Mortgage Forgiveness Debt Relief Act and Debt Cancellation 2007):

• it was the homeowner's primary residence for two of the last five years and “purchase money” was used
• the homeowner can prove insolvency (more debt than assets)
• the homeowner completed bankruptcy (and debt was discharged)

Part 4 of 5

* Home Sellers * -- see mortgage short sales we successfully sold

Read on Phoenix Homes for Sale

Help understanding the mortgage short sale process -- Part 4 of 5

BROKERS PRICE OPINION, or BPO for SHORT SALE PROCESS

(HELP #9)

Read part 3 of 5

The most important fact the mortgage lender needs to know is how much the short sale property is worth? Most mortgage lenders hire a real estate agent/broker to help evaluate the short sale property. This evaluation process is called the broker’s price opinion or BPO. The BPO is one of the largest hurdles to clear when completing the short sale process. Our goal -- after submitting your initial package to the mortgage lender -- is to get them to order this evaluation and provide additional comparable sales to insure it is accurate.

The agent/broker will call to set an appointment to complete the short sale BPO. We meet the agent at the home and develop rapport. We share how comparable sales and other factors affect the short sale properties value. If handled correctly, some agents will actually disclose the price they submit to the mortgage lender. This is a huge help because most mortgage lenders will not disclose the ACTUAL amount of the short sale BPO. They want to get the most money from the process for their mortgage investor.

HOW WE HANDLE THE SHORT SALE NEGOTIATION PROCESS

(HELP #10)

Here are some highlights that help negotiate a short sale process. Every mortgage lender and negotiator has a different approach when it comes to handling the short sale process:

• We are patient, yet persistent and helpful with the mortgage lender on the short sale
• We reinforce to the mortgage lender how a short sale helps save many costs associated with the foreclosure process: attorney’s fees, eviction procedure, delays from borrower's bankruptcy, damages to property in the process, etc
• We work to convince the mortgage lender how it's in their best interest to approve the short sale by accepting less money now
• If the mortgage lender responds with a higher short sale counter offer, we ask open-ended questions regarding their opinion of the validity of the short sale BPO to draw out more information
• We ask if they agree with the agent’s assessment and how it was obtained
• We expect a mortgage lender will actually accept between $10,000-$20,000 less for the short sale than stated

CAN SHORT SALE OFFERS BE REJECTED?

(HELP #11)

This is a familiar process: The mortgage lender receives the short sale BPO from the agent. It's higher than the offered sales price, so the loss mitigator requests that the contract price be increased. If this happens we:

• send back a "counter-to-the-counter" with the original offer price; we send additional comparable property information to prove why the mortgage lender should accept the original short sale offer
• send pictures of the neighborhood
• send copies of newspaper articles with “bad housing news”
• send a bid for repair estimates

We ask the following questions regarding the short sale BPO and process if the mortgage lender still thinks the short sale property is worth more:

1. Are the comps an acceptable distance from the short sale property?
2. Are the comps of comparable size?
3. Does the square footage of the BPO match the original appraisal?
4. What is the interior condition?
5. How much allowance is given for the deferred maintenance?
6. How high is the crime rate in the area?

These questions can help figure out if the agent did a good or bad short sale BPO. Then we can submit more information to the mortgage lender to prove their BPO is incorrect. As a last resort, we can ask the mortgage lender if they will accept an independent FULL APPRAISAL for review.

Remember that the mortgage lender wants to avoid the process of the buyer filing bankruptcy. They also desire to unload unwanted property without taking a huge loss. We will always help move the short sale process forward.

How to short sale part 3

How to short sale part 5

Read on Phoenix Homes for Sale

Help understanding the mortgage short sale process -- Part 3 of 5

SHORT SALE ITEMS YOUR MORTGAGE LENDER WILL HELP PAY

(HELP #6)

Read part 2 of 5

The lender(s) will usually pay for the following costs associated with the mortgage short sale process:

• Escrow fee (homeowner’s half)
• Owner’s title policy
• Mortgage Recording fee’s
• Short sale reconveyance fee
• Overnight mailing fee for the payoff
• Real estate property taxes and prorations
• Real estate commissions
• HOA dues and fee’s

If the HOA has placed a lien on the property, some mortgage lenders may allow $1,000 to be paid towards this lien to complete the short sale. We will negotiate with the HOA to reduce their fee’s and accept this money as payment in full. We will help remind the HOA they will receive nothing if this home goes to the foreclosure process and is sold at the trustee's sale! The short sale process will help them!

Mortgage lender will NOT HELP pay for the following short sale costs (see NOTE below the list):

• “buyer” closing and mortgage costs
• home warranty
• buyer’s mortgage appraisal
• buyer’s inspection
• any repairs to the short sale

NOTE: as of 2008 short sale process rules have changed. How? Mortgage lenders are now generally willing to help pay for the first two items on this list. Mortgage lenders are now more willing to negotiate details regarding a short sale. The bottom line is: if the mortgage lender wants the property off their books they will negotiate during the short sale process! Ask us how any recent changes can help the short sale process.

HOW WE HANDLE LOSS MITIGATION DEPARTMENTS

(HELP #7)

We will call the Loss Mitigation Department at the mortgage company and ask how long the short sale approval process will take once a complete short sale package is received. We fax all the short sale information discussed above. We include a fax cover page stating "this is a NEW SHORT SALE PACKAGE." We also request that they process an interior BPO, or Broker Price Opinion (this is an advanced form of a comparable market sales report).

The more complete the short sale package, the greater the homeowners chance for success in the process. The Loss Mitigation Department will be more willing to help us. There is only ONE opportunity to impress the mortgage lender with a strong, complete, and well organized short sale package! It's important that we do this process correctly the first time.

Once we have sent in your short sale package there is usually a one week wait (minimum) before calling the mortgage lender to learn which loss mitigation specialist is handling the file. The Loss Mitigation Department at the mortgage lender is busy -- if not highly overworked. Loss mitigators usually each have between 80-300 short sale files on their desk to process at one time. The loss mitigation specialist will be our contact for the duration of the short sale process. Our goal is to help the lenders short sale mitigator to work with us in the process. How? We provide as much short sale information as possible. This will help them with the short sale process and will ultimately help the homeowner. We show the short sale mitigator our expertise by sending them a complete mortgage short sale package and by being organized. We let them know we understand how busy they are with short sales and appreciate the valuable time they are spending to help the homeowner’s short sale process.

COMMON SHORT SALE PROCESS MISTAKES

(HELP #8)

3 common mortgage short sale process mistakes

1. Sending in a low-ball short sale offer that we know the mortgage lender will not accept.
2. Unfamiliarity with the short sale process. Mortgage lenders are busy and don’t have time to explain the short sale process. We show them how we know the process.
3. Not determining the intentions of a second mortgage lender, if one exists. Second mortgage lenders have the right to disapprove the short sale so we work quickly to learn their requirements.

Part 2 of 5

Part 4 of 5

Read on Phoenix Homes for Sale

Help understanding the mortgage short sale process

WHY HOMEOWNERS SHOULD DO A MORTGAGE SHORT SALE

(HELP #4) Read part 1 of 5

A short sale will be reported as “loan paid NOT as agreed” on a credit report. The number of 30, 60, and 90 day late mortgage payments before the loan payoff does not help and can be more damaging than the short sale process.

The foreclosure process will affect the homeowner’s credit report for between 7-10 years. A Deed in Lieu of Foreclosure (owner signs the house over to mortgage lender to avoid the foreclosure process) has less of an effect on their credit then a foreclosure. However, the mortgage short sale has the least affect on their credit. To summarize:

1. Foreclosure process (most effect on credit)
2. Deed in Lieu (less effect than foreclosure)
3. Short Sale process (most help preserving credit)

Many homeowners who participated in a short sale process were able to purchase another home within 2-4 years, depending on other credit issues. Additional benefits of a short sale to the owner include:

• helping get the short sale home sold and mortgage paid off
• mortgage lender accepting a discounted payoff from the short sale
• no out-of-pocket cost for the short sale process to the owner (mortgage holder will help pay all short sale costs)
• no worry about house and mortgage after the short sale

ITEMS YOUR MORTGAGE LENDER WILL PROCESS

(HELP #5)

Here is a list of items needed by most mortgage lenders to help complete the short sale process:

• Letter of authorization allowing us to help process the short sale on your behalf
• Hardship letter to inform how you have been affected by:
  o Family illness or injury
  o Job relocation
  o Job loss or significant income loss
  o Divorce or split of domestic partners
  o Adjustment in mortgage payment or unforeseen increase in living expenses
  o Anything else life can throw at a person
• 2 months pay stubs for each homeowner on the loan
• 2 months bank statements, all pages, for all accounts
• 2 years tax returns
• Comparative Market Analysis
• Listing agreement
• Short sale purchase contract and all counter offers
• Buyer’s LSR (loan status report) for the short sale process to show prequalification for purchasing the property
• Short sale settlement statement from the title company showing how the mortgage lender’s net proceeds are affected after all short sale costs are paid

Read part 1 of 5

Read part 3 of 5

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