Renaissance Realty Group’s Blog: Georgia: Duluth

On May 20, 2009, President Obama signed into law the Helping Families Save Their

Homes Act of 2009, which includes Title VII, Protecting Tenants at Foreclosure Act

(the "Act"). The Act provides that in the case of any foreclosure on a federallyrelated

mortgage loan or on any dwelling or residential real property, the party

taking title to property pursuant to the foreclosure ("Foreclosing Party") assumes

the property subject to the rights of any bona fide tenant. If the Foreclosing Party

wishes to evict the tenant, the Foreclosing Party must provide the tenant with 90-

days notice to vacate. However, if a bona fide lease was entered into before the

date of the foreclosure, the tenant has the right to remain at the property until

the end of the lease term, except that the lease may be terminated prior to the

expiration of such lease term upon the sale of the property to a purchaser who will

occupy the property as a primary residence, subject to the 90-days notice. In the

case of a tenant without a lease or if there is a lease terminable at-will, the

tenant must be given the 90-day termination notice. The Act also includes a

provision stating that any State or local law providing for longer time periods or

other additional protections for tenants shall not be affected by the Act.

The Act raises several unanswered questions and issues:

1) The Act may apply to all foreclosures, and not only to loan foreclosures.

Accordingly, lien foreclosures (such as a condominium or homeowner's

association liens) may trigger the Act's notice requirements.

2) The Act may prevent the Foreclosing Party from terminating a lease due to

tenant's default.

3) Title companies insuring title based on a foreclosure sale will likely require an

exception for the rights of tenants pursuant to the Act's notice requirements.

It is unclear whether title companies will be willing to delete this exception

after the notice requirements have been met.

In conclusion, the Protecting Tenants at Foreclosure Act severely affects the rights

of all foreclosing lenders, including lenders foreclosing on condominium projects.

The Short Sale Process

1. The first step in the short sale process is to obtain all the information including 2 years tax returns, bank statements, a hardship letter, listing agreement, net sheet, and contract, and submit it to the first lien holder.  In our office we use an attorney to handle this for our clients and it really helps in the negotiating process.
2. The second step is banks typically will not look at the file for 3-4 weeks.  They are so inundated with files, that they prioritize the files that are urgent first.  The urgent ones would be those close to a sale date or in foreclosure.  Once you have been served foreclosure papers banks tend to speed up the process and your file moves up to the top.  So in this 2nd step you must be patient.  
3. Once the file gets to the top of the stack than they will order at least 1 BPO (Broker Price Opinion).  An independent realtor will go ahead and look at the value of the property.  Sometimes it is a drive by BPO and sometimes they will request to come in the house.  A BPO is more of a realistic Comparable Market Analysis. 
4. As soon as they have the BPO they will look at the value of that BPO and the price of the contract, and make a determination on whether to order a full appraisal, another BPO or just use the existing BPO. 
5. Once they have the BPO they assign what is called a Negotiator.  The Negotiator is responsible in making sure everything looks correct, and he reports to the Investor.   The Negotiator also knows what the Investor is looking for as far as documentation, and what the lender wants to net.  The bank does not care how much the seller owes.  He cares about what percentage the bank is going to net from the BPO or appraisal.  The last lender I dealt with said they look for netting 81% of the value determined by the BPO or appraisal.  In this one they did not reduce commissions at all, but in some cases they will.  Usually the rule of thumb is that they will pay 5% with 2 realtors and 4% if one realtor has both sides.  In this one however, we got the full 6%. 
6. SO now the Negotiator has it, and he will send it off to the Investor.  The Investor will underwrite it and send it to a committee meeting, and they will make a determination if the offer is under their guidelines, and will either approve, decline, or counter.  Typically when they counter, they will just mention we need to net this amount.  They do not care how one gets there.  Realtors can kick in their commissions.  The buyer can come up or whatever else may work, but the bank will usually give a final counter number they want to net.

HELP AVOIDING FORECLOSURE

MORTGAGE DEBT RELIEF

LATE PAYMENTS?  MISSED PAYMENTS?

ADJUSTABLE RATE MORTGAGE?  LOW OR NO EQUITY?

     Georgia has one of the highest foreclosure rates in the nation with nearly 3,000 homes entering foreclosure per month.  In February of this year that amounted to 1 in every 299 households in Georgia.  Many of these are the result of ARM rates soaring and making it difficult for many families to meet their monthly mortgage payment.  Others are the result of job loss, and changes in personal incomes.

     If you are facing foreclosure, or anticipate having difficulty meeting your mortgage, you may qualify for a Short Sale.  A Short Sale is where your lender permits you to sell your home for less than the payoff and forgives the balance.  This can help you avoid foreclosure, bankruptcy, and a deficiency judgment.

NO FEES are paid by the Homeowner.

AVOID FORECLOSURE SCAMS.

Never pay anyone an upfront fee to "stop foreclosure".  We are a professional Real Estate agency specifically trained and experienced in negotiating Short Sales directly with lenders.

Our fees are paid by the lender upon successful completion of the Short Sale.

 Toll Free 24-hr Recorded Information:

1-800-214-4994  Code 2121

or, call now to speak directly and confidentially with a representative:

404-921-2067

LOCAL SHORT SALE CERTIFIED AGENT

Work with Renaissance Realty Group

Here to help you today

All Realtors will tell you the Kitchen can be the biggest make it or break it room in any buyers mind.. mainly because of the cost of making it right. So when getting you home ready to sell focus on the kitchen.

The kitchen is a good place to start removing clutter, because it is an easy place to start.

First, get everything off the counters. Everything. Even the toaster. Put the toaster in a cabinet and take it out when you use it. Find a place where you can store everything in cabinets and drawers. Of course, you may notice that you do not have cabinet space to put everything. Clean them out. The dishes, pots and pans that rarely get used? Put them in a box and put that box in storage.

You see, homebuyers will open all your cabinets and drawers, especially in the kitchen. They want to be sure there is enough room for their "stuff." If your kitchen cabinets, pantries, and drawers look jammed full, it sends a negative message to the buyer and does not promote an image of plentiful storage space. The best way to do that is to have as much "empty space" as possible.

For that reason, if you have a "junk drawer," get rid of the junk. If you have a rarely used crock pot, put it in storage. Do this with every cabinet and drawer. Create open space.

If you have a large amount of foodstuffs crammed into the shelves or pantry, begin using them - especially canned goods. Canned goods are heavy and you don't want to be lugging them to a new house, anyway - or paying a mover to do so. Let what you have on the shelves determine your menus and use up as much as you can.

Beneath the sink is very critical, too. Make sure the area beneath the sink is as empty as possible, removing all extra cleaning supplies. You should scrub the area down as well, and determine if there are any tell-tale signs of water leaks that may cause a homebuyer to hesitate in buying your home.

Let's broadly define a foreclosure workout as any arrangement negotiated with a creditor outside of the original terms of the loan. This method allows all parties to make the most of a bad situation and therefore it's favored over the other options when possible. A foreclosure workout on property may take one of the following forms:

1. Short pay or Short refinance.

   In most situations people accomplish this through a refinance of the property facing foreclosure. Example: The debtor owes $100,000 on their mortgage with another $15,000 in arrearage and legal fees. Someone negotiates for the loan to be settled for $80,000 and arranges a new loan for $85,000 to cover paying off the original bank and all associated transaction fees. The debtor has now avoided the foreclosure and eliminated $30,000 of debt. Sometimes a friend, relative or investor buys or pays off the mortgage from the creditor. Another way to make this work may be to negotiate as outlined here but instead of finding a foreclosure loan to cover both the settlement and the legal fees find the best loan you can and have friends or family make up the difference. at a discount

A: No, lenders are currently accepting loan modifications for a variety of reasons.  If you can demonstrate you are in  a financial hardship or are going to be in a hardship you are a strong candidate.  Borrowers whose loans have either recently adjusted or are about to adjust are also in a good position.  Recent homebuyers who are "upside down" in their mortgage where they owe more than their house is worth also generally qualify because they pose a risk to the lender in that they may "walk away" from their home rather than continue paying for a house that is depreciating.

Loan modification program starts

The Treasury Department announced that the first six participants to sign up for President Obama's loan modification program are JPMorgan Chase, which will get up to $3.6 billion in subsidy and incentive payments; Wells Fargo, $2.9 billion; and Citigroup, $2 billion.  The others are GMAC Mortgage, $633 million; Saxon Mortgage Services, $407 million; and Select Portfolio Servicing, $376 million.  A statement issued by Wells Fargo said, "We view this modification program as yet another incremental opportunity for thousands of homeowners to preserve and maintain the dream of homeownership."  Left unsaid is the fact that now the second wave of foreclosures will begin, as banks decide which loans are worth trying to save and which are not.

 Details of the loan modification program Only loans where the cost of the foreclosure would be higher than the cost of modification will qualify.  The modification plan calls for the bank to reduce interest rates so that the monthly obligation is no more than 38% of a borrower's pre-tax income, and the government would then kick in money to bring payments down to 31% of income.  Mortgage servicers (banks and mortgage companies) can also reduce the loan balance to achieve these affordability levels, and the government will share in the cost of the reduction, up to the amount the servicer would have received if it had reduced the interest rates. 

 Treasury will not provide subsidies to reduce rates to levels below 2%.  In addition to subsidizing the interest rates, servicers will use Treasury funding to pay for incentives for themselves, homeowners, and investors.  The program gives servicers $1,000 for each modification and another $1,000 a year for three years if the borrower stays current.  It will also give $500 to servicers and $1,500 to mortgage holders if they modify at-risk loans before the borrower falls behind.  Homeowners will even get up to $1,000 a year for five years if they keep up with payments.  The funds will be used to reduce their loan principals.  "We're confident we'll have enough money," said Treasury spokesman Andrew Williams.  Of course you will...if you run out, you'll just print more, right?