The meeting that almost made me cry…

I have a client.

One of many.

She and her husband were referred to me summer 2011 by my loan officer.

Seems she had been to one of those attorneys that advertise on TV about
eliminating her mortgage or modifying it…either way, she was $2500 lighter
with NO results or communication from his offices.

As well, she had listed her home with another realtor who had taken $750.
from her as an “upfront fee”. (Which IS illegal for a licensee to do.)

I listed her property as a short sale in March 2011…in December 2011, we
had received numerous offers and opened (and canceled) six escrows. The
last one was DAYS from closing when it happened…MURPHY’S LAW stepped in
to foul it all up.

She and her husband arrived at my office last evening to sign the SIXTH set
of cancellation instructions when she began to weep. Consoled by her husband,
I assured her that I had not abandon them and we would begin again. “That was
not it”, she replied.

SHe continued…”You’ve done so much work on our house sale and this happens again. We feel
like we owe you so much money. You have to earn a living.”

I assured her I was doing fine. That all the other referrals she sent me were a great help
and a testament to the job we are doing.

With that, she hugged me and smiled.

THAT’S my “WHY”.

Nothing left to say…

WHY Does This STUPID State Called “Nevada” NOT Have One Of these?

California SB 458

The California residential real estate blogs and media have been enjoying an anti-deficiency “happy dance” the last several days. Is this warranted or will some homeowners suffer unintended consequences by the expansion of the anti-deficiency provisions of CCP 580e to junior liens? In the short term, certainly many lenders will.

Existing Law

In late 2010 the California Legislature adopted, and the Governor signed, a bill creating Section 580e of the Code of Civil Procedure. This new section provided essentially that when a holder of a first deed of trust encumbering a 1–4 unit dwelling approves a short sale that is paid according to its terms then the holder (beneficiary) cannot subsequently pursue any form of deficiency liability against the borrower except in limited exceptions (which will be discussed below).

New Law

Last month the Legislature approved SB 458 (SB stands for “Senate Bill”). The Governor signed it as an “urgency measure” on July 11. It was filed with the Secretary of State on July 15, 2011. Most laws are effective on January 1 in the year after they are adopted. An urgency measure requires a super-majority vote and goes into effect immediately. Hence, it is currently effective for all short sales that meet its criteria. (Registered readers can receive a PDF copy of the official version of the new law by opening the preceding article.)

The new law expands the applicable rule to holders of notes secured by deed of trust or mortgage solely encumbering a 1–4 unit dwelling regardless of the priority of the deed of trust or mortgage (the “lien”). Therefore, it applies to second, third and subsequent deeds of trust, including HELOC’s (home equity lines of credit). It does NOT apply if the borrower (technically the trustor or mortgagor) is a corporation, limited liability company, limited partnership or political subdivision of the state, nor to deeds of trust securing bonds, such as public utility bonds.

Prior to 2011 a primary anti-deficiency rule applied primarily to purchase money deeds of trusts encumbering 1–4 unit dwellings that were occupied by the borrower (at least at the origination of the loan). The broader new law applied to vacation homes, rental properties, cash-out refinances, and HELOC’s, among others. It also does not fully apply when one loan is secured by more than one parcel of property, what is often called a cross-collateralized loan.

A short sale works only when all lien holders approve; otherwise, the non-approving lien(s) remains against the property in the full amount of the balance of the applicable debt. For practical purposes, this does not happen. The short sale is only complete, and the new law only applies, when title “has been voluntarily transferred to a buyer by grant deed or by other document of conveyance that has been recorded . . .” There must have been written consent by the holder of the note for which the procees of sale have been tendered to the note beneficiaries in accordance with the parties’ agreement (the short payoff letter terms).

Benefits

The primary benefit of the expanded law is that, “No deficiency shall be owed or collected, and no deficiency judgment shall be requested or rendered for any deficiency upon a note secured solely by a deed of trust . . .”

In addition, the law provides that a holder of a note shall not require the borrower “to pay any additional compensation, aside from the proceeds of the sale, in exchange for the written consent of the sale.” Hence, new notes from the borrower and “seller contribution” payments cannot be required.

Finally, any purported waiver “shall be void and against public policy.” So even if a lender gets a borrower to sign a waiver of the new law, that waiver is void and cannot be enforced.

Further Exceptions

The new law does not apply if the borrower commits fraud with respect to the short sale. Essentially, if the borrower/seller lies on their short sale application, then their short sale is subject to the laws applicable without this statute. Therefore, a “strategic default” application apparently must disclose the intentional nature of the breach and cannot argue a false hardship.

Another exception applies if the borrower commits waste with respect to the property. “Waste” is essentially intentional or grossly negligent damage to the property. So the seller/borrower cannot rip out appliances, smash windows or holes in walls, ignore leaking roofs, pour cement down the toilets, or similar damages to the property. In those cases, the “holder of the deed of trust or mortgage” is not limited in their ability to seek damages against the borrower. (Ordinarily, the references are to a “holder” of the promissory note who is the “beneficiary” of the deed of trust. It will be interesting to see if any talented litigation attorney can exploit this phrasing.)

You can be finished with fear.

Fear is the single greatest weapon the enemy has to keep you from achieving your best.

If you don’t face your fear, it can pollute your thinking, steal your joy and rob your dreams. Our world pays so much attention to negative news that focuses on fear.

“What if I lose my job?” “What if my child gets sick?” “What if the new business venture fails?” “What if I never find anyone and I end up all alone?”

Every day these kinds of poisonous thoughts come against us, but we don’t have to yield to them.
You can choose not to listen to, act on or focus on fear. Instead, you can face your fears and you can overcome them by placing your trust in the promises of God’s Word.

When we give in to the thoughts of fear, when we’re constantly thinking about it, wrestling with it and letting it dominate our thoughts, more often than not, our fears become a reality.

The way to overcome fear is with faith and trust in God. His Word promises us that when we act in faith.

No matter what you’re faced with today, as bleak as it may seem, you must believe in your faith. It is your faith that gives you strength and courage to ACT on that courage.

Have a great day!

I’m going to post ALL approval letters we’ve received…

So you can SEE and KNOW what to expect to protect yourself.

I think there will actually be a new DROP DOWN page which will contain all
approvals.

Your Approval Letter MUST Look Just Like This One!

IF YOUR SHORT SALE APPROVAL LETTER DOES NOT HAVE THIS OR EXTREMELY SIMILAR VERBIAGE IN IT…

FIRE YOUR ATTORNEY OR BROKER IMMEDIATELY…

Then call a professional. Me.

Click HERE to see it ===>>> Wells Fargo Deficiency Waiver

One of the FIRST Substitutions Of Buyer On A Bank Of America Short Sale…

OK…today marks the day I take up B of A on their newest policy regarding short sales and helping the homeowner.

I have a listing that sold within 30 days of listing it, then the investor raised the contract price. I informed the buyers agent and 48 hours later, the deal cancelled.

Fortunately, I retained all previous competing offers for the property and notified the agents that submitted them. Within another 48 hours, I had a new contract in hand for the newly approved sale price.

I contacted my negotiator, he advised how to re-submit the new contracts and I did.

So…now we wait.

Let’s see if this new policy actually IS a benefit or just more smoke and mirrors…

Stay tuned!

Bank of America Is Actually TRYING To Make Our Lives Easier?

Yes!

Now You Can Substitute a New Buyer for One Who Walked Without Restarting the entire process.

As an example of our commitment to improving the short sale process, Bank of America now allows real estate agents to submit a backup offer on a transaction if the original buyer has walked away from the sale. This means you will no longer have to initiate a new short sale; instead, you can continue with the original transaction in Equator and still work with your same short sale specialist. This change will save you time by not having to repeat a number of process steps.

When a Backup Offer Is Ready

You should send a message to your short sale specialist via Equator when the original buyer is no longer interested in the property. Your short sale specialist will then respond to you within two business days and ask if you have a backup offer ready to submit. If you have another buyer prepared to make an offer, the short sale can proceed without having to repeat the short sale initiation steps. The short sale status in Equator will change to “Marketing,” and you will be directed to complete the following tasks within 14 business days:

• Complete the “Listing Data” task.
• Provide the marketing description.
• Review the marketing plan.
• Upload the offer. (To do this in Equator, locate “My Properties,” then “Offers” and select “Place New Offer.”)
If the “Listing Data” task is not completed and the new offer is not uploaded within 14 business days, the file will be closed.

When No Backup Offer Is Ready

This new process applies only if there’s an available backup offer when a buyer walks. If you do not have a backup offer ready to be submitted, the short sale will be declined. In that case, you should return to marketing the property and initiate a new short sale in Equator once you receive another offer.
A new educational guide, How and When to Submit a Short Sale Backup Offer, is available to explain the backup offer process. If you have any questions, please contact your short sale specialist via Equator or call Customer Care at 1.866.880.1232.

Visit the Real Estate Agent Resource Center at bankofamerica.com/realestateagent for additional educational guides, news and resources to help you complete short sales at Bank of America.

“Why isn’t my home SELLING?!”

In a word?

P-R-I-C-E.

FORGET the condition of your house…that matters a little
but EVERY property will sell at the right price.

After 30 days on the market, I move EVERY seller of mine
to adjust the price down. AGGRESSIVELY.

Like the bandaid on a cut, you can pull it away slowly and
prolong the pain, or rip that bad boy clean off AND MOVE ON.

If your property hasn’t sold in 30 days or at least had numerous
showings, it’s not in the “showing zone”. The sweet spot where
all the buyers agents perceive your house as the best or at least,
a values for the market.

In a short sale scenario, the price makes NO DIFFERENCE to you
whatsoever as it’s not going to erode your equity – which you no
longer have anyway,

Getting the right deficiency waiver for your future is the reason
price reductions don’t matter in the least.

If you’re smart, YOU’LL push your agent to aggressively price
your property so you can get showings then an offer then a
closing…THEN you can move on and rebuild.

Not doing so, will be like that slow removing of the bandaid.

New FTC Rule Impacts Realtors’ Short Sale Business

According to the National Association of Realtors (NAR), a new rule from the Federal Trade Commission that aims to protect homeowners from mortgage relief scams may impact real estate professionals who represent clients involved in short sale transactions.

The Mortgage Assistance Relief Services (MARS) rule, which applies to residential real estate transactions, took effect January 31.

Laurie Janik, NAR general counsel, overviewed the new rule Wednesday at a forum during the Realtors 2011 Midyear Legislative Meetings & Trade Expo in Washington, D.C.

“As the leading advocate for homeownership, NAR supports efforts to ensure that mortgage assistance relief services truly benefit consumers,” Janik said. “Nevertheless, NAR has some concerns about the rule and its application to real estate professionals involved in short sales transactions.”
Primarily directed at companies offering modification services to consumers, the rule bans all upfront fees for renegotiating mortgage terms and mandates that certain disclosures are made to consumers if a short sale is negotiated with a lender on their behalf or when advertising short sales experience.

But according to Janik, the rule may also impact real estate professionals who represent clients involved in a short sale transaction.

She explained that it pertains to such practices as advertising short sale negotiation services or other short sale expertise, communicating with a consumer about a possible short sale before the listing agreement is executed, negotiating a short sale on behalf of a consumer, or arranging a short sale negotiation for a consumer.

Realtors must comply with the rule by not taking upfront fees and using specific disclosure language, Janik explained.

A real estate professional now needs to include a clear and prominent disclosure in all commercial messages that advertise short sale services. In addition, second and third disclosures are required by real estate professionals before they begin mortgage assistance services on their clients’ behalf and at the time they present their client with the lender’s short sale approval letter.

“NAR is discussing with the FTC some language in the second and third disclosures as well as some other requirements found in the MARS rule,” Janik said. “The FTC is considering possible options to help make the rule more applicable to a real estate brokerage…when they are performing traditional real estate functions in a short sale transaction.”