We recently spent a fantastic extended weekend in Oregon, the majority of which we spent in Portland and the surrounding area. Afterwards, I (Brian) went solo to Bend by car for a trade show. Here are some highlights of our trip that no one should miss out on:
Stay where we stayed!
Inn @ Northrup Station, Portland,OR
4br – A Majestic Mountain Retreat voted “Best in the NW”
6br – Rockaway Beach, Oregon
Check out the rooftop deck we’ve been building at our house:
Many people ask me about short sales and I felt it was about time to discuss the term and situation to determine if it might be something that can help you. First of all, this is a last resort. Remember that. It’s a way to work with the bank in an attempt to sell the home for less than is owed and to avoid foreclosure.
There are a number of things that can lead to a situation that can be remedied by a short sale (it’s called “short” because the bank is approving a sale that is “short” of the actual amount due to them on the mortgage). Predatory lending practices, “teaser rates” resetting on Adjustable Rate Mortgages (ARMs), a job loss, illness or other hardship are just some of the reasons that might require a seller to seek a shortsale. The problem is over the past few years people just assumed if they purchased a home it’s value would go up. Period. So, people thought, if they got a great 5 year interest only ARM rate, and put no money down (which lenders were allowing all too frequently) they could “ride the wave” of appreciation and when they went to sell their home in 5-6 years, they’d be able to sell at a profit. Now we’re near (or, arguably, in) a recession and home values have not gone up as much as everyone expected. Lending practices have changed. People find their Adjustable Rate Mortgages are ADJUSTING. Because they have no equity in their homes (having only paid interest is part of it, but the lack of home appreciation is a bigger part) they find they are unable to refinance for a better rate, as they don’t have the necessary Loan to Value (LTV) ratio to get a loan. This is complicated in situations where borrowers have lost their job, done damage to their credit, or just can’t qualify for a new loan, so they’re stuck paying extremely high interest rates. Sure, they agreed to these increased rates when they signed their loan applications but they never thought it would come to this — they just assumed they’d have lots of equity because home prices go up every year, right? People sometimes imply that this has only happened to “stupid people” or “poor people”, one particular ethnic or racial group or certain select neighborhoods. Let me tell you something — it’s doesn’t matter if you’re white, black, latino or asian, a judge, a real estate agent or a janitor. It has affected people from all walks of life and it’s had a huge impact on everyone. People just didn’t expect this to happen.
So what do you do about it? What if your payments have gone up 25%, 50%, even 100% and you can’t afford to pay anymore? First things first, call a lending professional that you can trust. I have a mortgage broker that I highly recommend, Brian Weis with Guaranteed Rate. I trust him with my needs and my client’s needs. He can be reached by telephone at 773.290.0591 or by email at email@example.com. There are other great lenders out there, too, just make sure, if you’re going to call someone regarding something this important, you use someone who comes highly recommended from people you trust. You’ll want to discuss refinancing your loan and see if there’s anything they can do to help. This could solve all your problems and make life much easier. And if that’s the case, hooray! If not, keep reading.
Now we’ve gotten to the short sale. First, contact an agent you trust. It should be obvious that I would prefer you called me; however, if you have someone that knows what they’re doing, that’s all that matters. They should be well versed in short sales. They’re nothing like a regular home sale, so make sure the person you’re using knows how to deal with lenders and has experience working with them. From my point of view, as an agent, a short sale is A LOT more work than a standard sale. Also, it really is something that can affect your entire life and must be handled as such. Be careful not to just pick “Joe Agent” from the yellow pages — this is important stuff.
It will be this agent’s job to work with the lender to negotiate a price that, although below the amount owed, is a fair market price that the lender will agree to sell at. You will need to provide a few very personal items with the agent that you choose to represent you, so it’s best to get these all ready before you meet with the agent:
- Proof of Income in the form of your last two pay stubs. This will be required for ANYONE on the loan,
- Last 2 bank statements,
- Letter of hardship (Click HERE for an example),
- Last tax return,
- A list of all debts, secured or unsecured. This includes car loans, credit cards, etc. Make a note of total debt and monthly payment (do this for anything that would be on your credit report),
- A list of all expenses not included in the above bullet. This would include food, transportation, insurance, utilities,
- Anyone’s social security number on the loan as well as the loan number and name of your lender. A copy of a mortgage bill is a great way to provide your agent with the latter two items.
It’s a lot of things, agreed, but they’re all necessary. Now is the time to make an appointment with your agent and authorize him or her to sell it, determine a price and prepare to show the home.
Remember, if you have any questions regarding short sales, I’m available by telephone (773.715.2205) or email (use the contact link on the top right hand side of the website).
I think everyone will get a kick out of this video and understand
why I think Pullman is one of the most unique neighborhoods in
Chicago. And remember, it’s only 10 minutes by Metra to Hyde Park and 25
minutes to the Loop. It’s a great place for first time homebuyers, U
of C students and anyone looking for a historic home in a quirky
neighborhood that is AFFORDABLE! For more information on Pullman scroll down to “Historic Pullman Links” on the right hand side of this page and do a little investigating. I think you’ll be amazed!
A pretty interesting before and after photo taken from our roof during earth hour. Trump Tower failed to turn off their lights. Shocking. Another reason to forget about “The Donald” and come to “The Johnson” for all your real estate needs.
(click to enlarge)
Rates for the Week Ending November 2nd, 2007*
30 Yr Fixed Conforming: 6.125%
30 Yr Fixed Jumbo: 6.875%
5 Yr ARM Conforming: 5.750%
5 Yr ARM Jumbo: 6.250%
5 Yr ARM Interest Only Conforming: 5.750%
5 Yr ARM Interest Only Jumbo: 6.500%
Prime Rate is at: 7.500%