Why would you think the County Commissioners wanted to wait until after they voted on the Gwinnett County Solid Waste Collection and Disposal Services Ordinance of 2010 to publish the ordinance? Could it be that they have realized that the lawmakers in Washington D.C. actually got it right by not being transparent? Could it be that they really do have something to hide? Could it be that they are afraid of the confrontation that would have occurred once the educated citizens of Gwinnett County read this 37 page document. Could it be all of the above? After printing out the ordinance and going through it, several things stand out; Minimum Requirements and Service Levels for the Residents of Unincorporated Gwinnett County, Fees for Service, Settling the Existing Lawsuits and Penalties.

Minimum Requirements

There are 4 pages of the ordinance that talk about the Minimum Requirements for Service Providers. Let’s see if we can figure out from these 4 pages what the Commissioner’s intent is for Minimum Requirements the residents of Gwinnett County.

As you can well see, the County Commissioners really had the interests of the citizens of Gwinnett County placed high on their list of priorities. Weekly Collection…WOW!

Fees For Services

Now that the ordinance has been made public, let’s look at what it says about fees. First off the fees will be collected on the tax bills with 18 months being collected on the tax bill coming out starting in the summer of 2010. The tax bill coming out in the summer of 2011 will include 12 months of trash service. Actually that makes sense. Wait a minute, no it doesn’t there is no amount for monthly trash service. Is this whole thing coming back to Gwinnett County Government looking for an additional revenue stream? As with everything else regarding Gwinnett County Government, It’s All About The Money!

Settling the Existing Lawsuits

It is old news that Gwinnett County has been served with several lawsuits regarding the previous Solid Waste Disposal Plan. The new ordinance states:

WHEREAS, the Gwinnett County Board of Commissioners has determined that, in the best interest of the residents of Gwinnett County, the legal actions referenced above should be settled; and

WHEREAS, the Gwinnett County Board of Commissioners has determined that, in connection with the settlement of the referenced legal actions, the 2008 Ordinance should be deleted in its entirety.

The question is how do the Commissioners intend to settle these lawsuits? Will the Plaintiffs be given preferential treatment in regard to the Service areas? I see nothing in the ordinance that is specific as to how the Residential Service Provider will be selected for the Residential Service Areas. Will it be via a sealed bid process or just the County assigning a particular provider (preferential treatment) to a particular area?

But Wait There Is More…Penalties

Section V A iii States that beginning 7-1-2010 each Owner of a Residential Service Unit shall Dispose of Residential Municipal Solid Waste, White Goods, Bulky Waste and or Yard Trimmings with the Residential Service Provider that has been issued a service agreement by the County for the Residential Service Area in which the Owner’s Residential Service Unit is located. What if I wanted to collect aluminum cans and then sell them myself? Damn It, I would be in violation of this ordinance. Well what would the consequences be? That would fall under Section XXIV Penalties. Any person violating any provision of this ordinance may, upon conviction, be punished by a fine not to exceed $1,000.00 for each offense and /or incarceration or community service not to exceed 60 days. Each day a violation occurs shall be considered a separate and distinct violation.

I thought the previous ordinance was stupid with its $500.00 fine. It even made national news on the Drudge Report. How stupid does this make our county commissioners look? I’m guessing it doesn’t actually do them justice.

So what do you think?

Just how deaf are the Commissioners in Gwinnett County? Well let me see is I can help everyone understand. Last year I served along with a group of volunteers on The Gwinnett County Trash Advisory Committee. We held 6 public meetings throughout the county and the one thing we heard at every meeting was that the citizens of Gwinnett County wanted to be able to choose who their trash hauler was to be. The citizens wanted to have the right to fire a trash hauler that did not perform up to the citizen’s expectations.

The county then paid $131,000 of our tax dollars to R W Beck, a consulting firm, who also conducted public meetings to obtain citizen input regarding trash collection in Gwinnett County. The overwhelming result of the citizens input during these meetings, at least of the ones I was able to attend, once again was that the citizens of Gwinnett County want to choose their trash hauler.

Fast forward to March 2, 2010 Board of Commissioners meeting and the vote to approve the New Gwinnett County Trash Plan. Below is from the Gwinnett County Website:

The Gwinnett County Board of Commissioners adopted a new solid waste ordinance for unincorporated Gwinnett County during the board’s business session on March 2, 2010. You may read the ordinance as drafted and also view this brief video clip of discussion among commissioners during the meeting that reflects a slight change made to the ordinance before it was adopted. The ordinance as adopted will be posted as soon as possible.

Gwinnett County’s Solid Waste Information Center – 770.822.7141 – is open for callers Monday through Friday between 7:00am and 7:00pm.

Now I don’t know about the rest of you but I don’t think that 5 districts with only one hauler per district equals choice. My parents always told me not to make fun of the handicapped and I have adhered to that policy up until now. This Board of Commissioners is handicapped. They have proved beyond a shadow of a doubt that they are DEAF. They have no desire to represent the wishes of the citizens of Gwinnett County in this trash matter. So here is my recommendation for the Board of Commissioners… RECALL THESE DEAF IDIOTS NOW!

So what is happening with the real estate market in the northeast quadrant of Atlanta? Rather than just stating the same old clichés, I thought it might be beneficial to look at the sales numbers in a year verses year format and make the comparison in the number of homes sold. The three (3) areas that will be examined are Forsyth County, Fulton County and Gwinnett County. To get a true picture of what has occurred over the last three (3) years, both Single Family Residences (Residential Detached) and Condo/Townhome (Residential Attached) sales have been included.

Forsyth County

Fulton County

Gwinnett County

Real Estate is very local and each market is different. What is happening in Phoenix, San Diego, Miami or any other area of the country is specific to that local market. While the numbers bear out that the northeast Atlanta market has declined since 2007, it’s not as bad as the news media might want us to believe. As a matter of fact look at the total sales numbers for Gwinnett County in 2008 vs2009. That certainly has not been reported on the news.

Short Sales and Foreclosures have had a definite negative impact on values and it is anticipated that they will continue this trend until the market stabilizes. While I think everyone knows what a foreclosure is, the term short sale may not be as well known. For those who would like a little additional reading here is a link to a series of articles that define what a short sale is and how the process works. Atlanta Short Sale and Foreclosure Information

Many times I am asked when do I think the market will come back. I don’t know exactly but I am starting to see what I believe to be a bounce off the bottom. If I am correct we will begin to see sales prices starting to rise. In the mean time, while prices are low and interest rates are down now is an excellent time to buy or invest in the real estate market. If you know anyone looking to buy or sell let me know. It’s not too late to take advantage of the $8,000 first time buyer tax credit or the $6,500 tax credit for existing home owners. If you are not aware of the requirements to take advantage of these programs give me a call or shoot me an email.

A Picture is worth a thousand words!

Buying a Short Sale Home

Considering today’s market along with the tremendous growth in the number of short sale properties available, the potential for buyer’s to obtain a “Bargain Deal” has increased substantially. Of course the baggage that comes with the increased opportunities provided by short sale properties is that buyers must be in a position to wait for lender approval among other things to close. The process can often take up to 4 to 5 months and I have heard of some transactions taking over 9 months. Buyer’s should also understand that the seller probably did not have funds to maintain the property and it is almost a certainty that the property will be sold “as-is” without any repairs being made.

What Short Sale Buyers Need To Be Prepared For

Prior to entering into a purchase and sale agreement for a short sale property, buyer’s need to have a full understanding of the process along with a knowledge of what is expected of them. Let’s examine what is expected of the buyer’s:

•    Prequalification For A Loan – The lender is going to want to see that the buyer has been completely prequalified by a reputable lender who has examined the buyers credit file with all three reporting agencies in addition to examining the buyers income and debt ratios
•    Realistic Expectations of the Time Frame – There is no set time frame in which a short sale transaction can be closed. One of the largest factors is how well did the listing agent prepare the short sale package for the seller’s lender. This is totally out of the buyer’s control and presents a real source of frustration. As stated earlier, the process can take 4 to 5 months.
•    Flexibility of a Closing Date – If a buyer is on a very strict time frame, such as an apartment lease coming to conclusion, a short sale is probably not the avenue a buyer in this situation would want to pursue. The time frames will almost certainly change and there can be multiple closing date extensions to the contract.
•    Resources to Make Necessary Repairs – Considering that the seller has experienced a financial hardship of some kind it only makes sense that they were probably unable to maintain the home. To help identify what potential problems there may be, make certain that you have a home inspection by a qualified home inspector.
•    The Lender Makes the Final Call – Buyers of short sale properties must understand that even though they have reached an agreement with the seller, it is the seller’s lender or, in some cases, lenders who will make the final call. It is possible for one lender to approve the transaction and the other not to approve it thereby starting the negotiation all over.
•    The Sale Can Fall Through – Through no fault of the buyer or the seller the sale of the property can fall through. As earlier stated, the lender has the final say as to whether or not they will approve the short sale.
•    Interest Rates Change – Interest rates change on a daily basis. In times of a more volatile market they can even change several times in a single day. When a contract is entered into a buyer may be expecting one interest rate and by the time the sale closes a different rate may prevail. Currently interest rates are at historic lows and the market is not volatile. This means that interest rates are remaining constant. I just wanted to share that the potential exists for interest rate fluctuation due to the amount of time that lapses between when the contract was entered into and the time it closes.
•    Knowledge of Who You Are Dealing With – For those of us who have successfully closed short sale transactions, we have a pretty good idea of what to expect from the various lenders. RE/MAX Chairman and CEO Dave Liniger took it upon himself to help educate some of the powers that be as can be witnessed in this article.

As your Atlanta Short Sale Buyers Agent there are several tasks that will be performed for you. You will get a complete market analysis of the property and the comparable properties in close proximity. In order to best determine how good a job the listing agent has done we will ask several questions:

1.    Is the short sale package ready for submission to the lender? If the agent is not familiar with what needs to be included in this package the chances for the property ever closing as a short sale are extremely low.
2.    How many liens are on the property? The more liens the more difficult it is to get everyone to agree and approve the short sale.
3.    If more than 1 lien, what are they? (a first mortgage, a second mortgage, a tax lien, a mechanics lien, etc.)
4.    What is the plan to satisfy the lien holders? There needs to be a satisfactory plan in place or we could just be spinning our wheels.

Finding a deal in today’s Greater Atlanta Market on a short sale property is easy. Following it through to conclusion is a talent. Why don’t we put my talent together with your desire to obtain a fantastic deal?

Whether you are interested in a Short Sale or a Foreclosure having proper buyer representation is to your advantage. Here is what one of my clients had to say about her experience:

I wanted to say thank you once again for making my house buying experience an exceptional one.  The care, time, patience and effort you took to ensure that I was satisfied with my purcase was exemplory. I have heard stories about the things other agents do and was very sceptical until I realise that you are the “REAL DEAL“..  You went above and beyond the call of duty to ensure that I had all the information necessary and that I would be aware of what to do and not to do!  Thanks Mack!  You were right…..when you are with Mack, get ready to pack!

Sheryl Clarke

Stop Foreclosure

What Makes an Effective Short Sale Package?

In the last article, The Anatomy of a Short Sale, we examined what potential requirements would be required to qualify for a short sale. Now we are going to examine what items are needed in order to assemble an effective short sale package for the lender. The short sale package, when completed with all the required documentation, can have a very positive effect on the result of the transaction. If there are multiple loans on the distressed property this package must be duplicated so that each lender has a complete package. How the short sale package is submitted to the lender is at the direction of the lender. The lender(s) may want it faxed, emailed or delivered in hard copy via the mail. Let’s look at the items that should be included in the package:

•    The Cover Letter – Also known as the Short Sale Proposal Letter. This letter should be one page that is clear and concise providing the lender with an accurate overview of the distressed owner’s situation, what they owe on the property, what the property is worth, what repairs are needed on the property and complete details of the negotiated purchase offer.
•    Short Sale Payoff Application (If Applicable) – This application, if applicable, will be provided by the lender, should be completed by the seller and should be included in the short sale package.
•   Seller’s Hardship Letter – The hardship letter allows the seller to explain their situation to the lender. The sellers should communicate that they are sorry, their circumstances and that they have exhausted all their options and the next step is letting the property go to foreclosure.
•    Seller’s Financial Information – The owner’s financial information can easily be compiled by listing Assets (Real Estate, Stocks, Bonds, Mutual Funds, Bank Accounts, Personal Property and Retirement Accounts), Liabilities (Real Estate Loans, Personal Loans, Credit Card Debt, IRS Liens, Judgments and Lawsuits) and Monthly Expenses ( Credit Card Bills, Utility Bills, Car Payments, Insurance Payments, Food and Clothing, Medical Bill and Prescriptions, Child Support and Tuition Expenses)
•    Supporting Financial Information – These documents are typically the same as the ones that were provided when the seller applied for the mortgage(Pay Stubs, w-2’s or Tax Returns and Bank Statements or Credit Reports) The lender will advise as to how far back they want you to go with the documentation.
•    Supporting Hardship Information – A complete picture of the distressed homeowner’s situation can also be supported by also providing the lender with additional documentation (HOA Liens, Medical Bills, Disability Statement, Unemployment Benefits or Status or Divorce Decree).
•    Repair Estimate – If repairs on the property are needed, a detailed estimate of cost by a licensed contractor should be included with the short sale package.
•    Market Analysis – The REALTOR should prepare a BPO, Brokers Pricing Opinion, to be included in the package. This BPO will highlight data such as Average Days on the Market, Number of Short Sales and Foreclosures in the area, Pricing Trends, Recent Economic Data and the Absorption Rate. The lender will also order one or two BPO’s after they receive the short sale package.
•    Marketing History – The lender want to see that everything possible has been done to obtain the best price for the property. They want to see a complete list of showings, feedback and advertising.
•    Purchase Contract – The Purchase and Sale Agreement will be totally negotiated, executed (signed by all parties) and submitted with all supporting documents to the lender. The supporting documents would be the buyer’s preapproval letter, a copy of their earnest money deposit and a Preliminary HUD-1 prepared by an attorney.

Follow-Up is Needed

After the short sale package has been submitted several things must be verified with the lender. This follow up is vital to the success of the short sale. We must make certain that the package was received and there is nothing more needed in order to approve the sale. We must also verify that the Loss Mitigation Department has or will communicate with the Foreclosure Department to try to ensure that foreclosure proceedings have been halted. During this process we will establish how the Loss Mitigation wants to be contacted; phone, fax or email.

Incomplete Package = Failure

One of the most common reasons why short sales fail to reach a successful closing is because an incomplete short sale package was submitted to the lender. It is important to remember that in today’s market the loss mitigation departments of the lenders are completely covered up distressed property transactions. The negotiators simple do not have time to hold someone’s hand and guide them through the process or let them know what documentation they are missing. They devote their time to working on short sale transactions where they have complete packages and documentation. The incomplete packages simply get put in a pile that will be handled when they have the time, which they never will. Just by the nature of the beast, short sale transactions can take a long time….Without a complete short sale package they will take forever.

Should We Talk?

If you reside in the Greater Atlanta Area, are in a distressed housing situation and would like a confidential meeting to discuss your options feel free to contact me. You may use the contact form on this page or you can call me at 770-318-2572.

Stop Foreclosure

The Anatomy of a Short Sale

Not every owner of distressed property is a candidate for a short sale and therefore they cannot all be saved from foreclosure. In this article we will examine the circumstances that may qualify a homeowner for participation in a short sale.

Is There a Valid Hardship?

What exactly constitutes a valid hardship? Loss of Equity due to a declining market is not considered to be a valid hardship. Lenders will however consider and possibly entertain a short sale for homeowners who have experience one or more of the following:

•    Job Loss
•    Business Failure
•    Illness and Medical Costs
•    Divorce or Death of a Spouse
•    Natural Disasters

Is There Sufficient Time to Accomplish a Short Sale?

A short sale, as we defined earlier, is a situation in which the seller (1) owes more on the loan than the sale of the property will likely produce and (2) is unable to bring funds to closing to satisfy the deficiency. The timeframe for completing a short sale in Georgia can be very limited due to Georgia being a Non-Judicial Foreclosure state. Once a homeowner realizes that there is a problem they should consult with a real estate professional knowledgeable in the short sale process. There can be a matter of only a month or two in order to complete a short sale. Both the homeowner and the REALTOR should have conversation with the lender, confirming each conversation in writing, and establish a time line that the lender will allow for the transaction to be completed. Short Sale transactions are not for the faint of heart. They are often very difficult and time consuming therefore they should be handled by a REALTOR experienced with short sales and distressed properties.

Roles of Finance, Tax and Legal Professionals

One constant message in this series has been to keep finance, tax and legal professionals involved in the process. Realizing that homeowners who are approaching mortgage default may argue that they cannot afford to pay these professionals, I understand. I would like to point out however that some attorneys that work with owners of distressed property take into consideration the current financial reality and allow ways to navigate the process with little or no upfront fees. There are several websites that can direct distressed owners to free counseling.

Determining What Is Owed on the Property

In order present a true picture to the lender it is imperative that we determine exactly what is owed on the distressed property. Let’s look at the items that will have to be satisfied in order to have a successful closing:

•    Principal Balance and Interest
•    Real Estate Taxes
•    Second Mortgage or HELOC (Home Equity Line of Credit)
•    Home Owners Association Dues
•    IRS Tax Liens
•    Mechanics Liens

Property Condition

Understanding that there has been difficulty in staying current on the mortgage, it is likely that maintenance of the property has been neglected. We should examine the home and evaluate what will be needed in order to have the opportunity to successfully close the transaction. This doesn’t mean that repairs must be made, however we should take them into account so that we can again build our case for the lender.

How to Price a Short Sale Property Listing

As the listing agent for a short sale, my goal is to price the property in a manner that the seller, the homeowner, will receive and offer that has a realistic chance of closing. There are instances where the listing agent prices the property where the seller needs the price to be, which may be too high. Another fault is when the property is priced at an unbelievable low price which entices buyers to submit an offer only to have it rejected by the seller’s lender, who must ultimately approve the contract.

There is no set formula for pricing a short sale, however in order to reach a successful closing the proper price should be somewhere on the low end of fair market value. Freddie Mac has stated that their target sales price is 88% of the Broker Price Opinion (BPO). We would have to think that the guidelines would be similar for FHA and Fannie Mae.

What Do We Need From Distressed Property Owners?

In order to complete a successful short sale we must first start with a solid beginning. The homeowner must provide the REALTOR with an Authorization to Release Financial Information for each lien. The seller should have already contacted the Loss Mitigation Department of their lender. As your REALTOR, I will also be contacting them. This must be done for each of the lien holders. There are multiple questions that I will be asking the lender’s representative so that we can make the process as smooth as possible. Just as with non short sale listings the seller should fill out a Sellers Property Disclosure Statement and let potential purchasers know everything about the home.

Negotiating a Short Sale Contract

The contract for a short sale is entered into between the buyer and the seller, not the buyer and the lender. The seller’s lender only approves the contract. Taking this into account we will negotiate the contract in the same manner that we would negotiate a non short sale offer. Once we have an accepted contract between the buyer and the seller, we will not submit any additional contracts to the lender. If we obtain additional contracts we will negotiate them as backup contracts and treat them as such. We should however anticipate several questions from an experienced buyer’s agent prior to the submission of an offer:

•    Is the short sale package ready for submission to the lender?
•    How many liens are on the property?
•    If more than one lien what are they?
•    What is the plan to satisfy all the lien holders?

As you can see we need to have a solid plan in place in order to answer these questions as well as others that may arise. We accomplish this by have an open line of communication with all lien holders as well as each other.

Do you know someone in need of this level of service? As a Short Sale and Foreclosure Resource, I am here to help. Don’t hesitate to contact me as we need to get the ball rolling if we are going to stop foreclosure.

Stop Foreclosure

In the initial article on Atlanta Short Sale and Foreclosure Information we examined the terminology used with short sales and foreclosures along with the pre-foreclosure and foreclosure process. In this article we are going to examine potential options available to owners of distressed properties. Please understand that these options are being presented in a general context and to determine which option would best suit an individual circumstance it would be best for the homeowner to also discuss all options available with qualified finance, tax and legal professionals.

Distressed Homeowner Options

Refinance

Homeowners that are current on their mortgage may be able to take advantage of today’s lower interest rates by refinancing via the Making Home Affordable initiative launched in early 2009. The criteria to be eligible under this program are as follows:

•   The Home – Must be owner occupied and be a one to four unit home
•    The Existing Mortgage – Must be owned or backed by Fannie Mae or Freddie Mac and the Loan-To-Value Ratio (LTV) is above 80% but not more than 125% (If you don’t know if your loan fits into this category you can check to see at http://makinghomeaffordable.gov/loan-lookup.html)
•    The Borrower – Is current on existing mortgage payments and has sufficient income to support the new mortgage payments

Sell and Bring Cash to Closing

Even though many homeowners may not have the cash to cure a deficiency at closing, they may have assets in the form of Treasury Bonds or Individual Retirement Accounts to do so. Homeowners can avoid the credit damage that a short sale or a foreclosure can cause by curing the deficiency in this manner. Before considering this option homeowners are strongly advised to consult with their financial and tax professionals to examine any negative effects.

Lender Workout

Remember the lender does not want the home. The lender, in many circumstances, will work with owners of distressed properties to help the homeowner keep their home. Let’s examine Mortgage Workout Options:

•    Forbearance – If you have a reasonable plan for catching up your lender may allow you to make partial payments or skip payments. Inform your lender if you are expecting a Tax Refund, A Bonus, or perhaps a new job. Let them know what is changing that will positively impact the situation
•    Reinstatement – Reinstatement refers to making a payment that covers all the late payments and is usually at the end of the forbearance period
•    Repayment Plan – Perhaps you can’t afford reinstatement, your lender may allow you to pay an additional amount each month until you are caught up
•    Loan Modification – Many lenders may agree to amend or modify your mortgage to avoid foreclosure. Ways that the mortgage could be modified  would include:
1.    Adding all the missed payments to the loan amount and increasing the loan amount to cover the increased principal
2.    Increasing the number of years for you to repay the loan, lowering the interest rate or forgiving a portion of the loan to reduce your monthly payment
3.    Switching an Adjustable Rate Mortgage to a Fixed Rate Mortgage helping you to avoid the fluctuations in your monthly payment
4.    Establishing an escrow account for taxes and insurance with your mortgage so that you do not have those large expenditures

Earlier we discussed the Making Home Affordable Initiative for Fannie Mae and Freddie Mac owned or backed properties where the homeowner is current on the mortgage. Homeowners struggling to stay current on their mortgage who have experienced a change in income or other financial hardship may seek a loan modification via the Home Affordable Modification; which is a component of the Making Home Affordable Program. The Home Affordable Modification is a voluntary program with participation from major mortgage servicers. Let’s look at the requirements for this program:

•    The Home – Must be owner occupied and is a one to four unit home
•    The Existing Mortgage – The unpaid balance is less than $729,750 for one unit properties (Higher Limits are available for 2, 3 and 4 unit properties), the loan was originated before January 1, 2009 and payments exceed 31% of the borrowers gross monthly income

Under the Home Affordable Modification, once the loan has been modified there is a three month trial period. If during the trial period the borrower is successful with the modified interest level and the mortgage payment, the lender will execute an agreement that lowers the interest rate to a fixed rate for five years and caps the interest rate for the remaining life of the loan.

Please note that these lender workouts and loan modifications are not an area where I represent homeowners in an agency capacity or a client relationship. Even though they are real estate related transactions they are not a real estate transaction as defined by law. Even though I cannot represent homeowners with these options, they are viable alternatives for distressed property owners and they should be covered in this article.

Short Sale

Again, a Short Sale is defined as a situation in which the seller owes more money on the loan (and any other liens on the property) than the sale of the property will likely produce and the seller is either unable or unwilling to bring money to closing. In a short sale situation the lender has not yet foreclosed on the property and there is a window of opportunity for the homeowner to sell the property and at least partially satisfy the loan.

A short sale is considered to be preferable to a foreclosure because typically the homeowner’s credit is not damaged as severely as with a foreclosure. A short sale can also lessen the impact on the surrounding community.

There is also a portion of the Making Home Affordable Initiative that can be applied to a short sale. For borrowers that meet the eligibility requirements of the Home Affordable Modification but do not qualify for a modification Foreclosure Alternatives may be an option. Under this program borrowers and mortgage services are both provided with incentives to help prevent foreclosure.  The incentives are as follows:

•    $1,000 for lenders for a successful short sale or deed in lieu of foreclosure
•    $1,500 for distressed homeowners to help with relocation expenses
•    Up to $1,000 for junior lien holders (second mortgage or HELOC) to release liens
•    90 days up to 1 year for homeowners to market and sell the property
•    No foreclosure may occur during the marketing period specified in the Short Sale Agreement
•    Mortgage servicers cannot charge fees to borrowers for participating in Foreclosure Alternatives
•    Mortgage servicers cannot negotiate lower commissions after an offer has been received. (This has been a problem in the past and has caused some real estate practitioners to not show short sale properties)

Deed In Lieu of Foreclosure

A deed in lieu of foreclosure occurs when the borrower agrees to trade the property to the lender in exchange for the lender cancelling the note. Market conditions have the greatest influence whether or not the lender will accept a deed in lieu of foreclosure. Typically lenders are less willing to accept a deed in lieu of foreclosure in a declining market.

Foreclosure

While foreclosure is an option, hopefully it will be the option of last resort. The previous options have been directed at ways to avoid foreclosure. In some cases foreclosure may be the best option even though it will most certainly wreck the homeowner’s credit.

Do Nothing or Walk Away

Walking away from the loan or asking the lender to proceed with a short sale simply because the value of the property went down is not a recommended option. If this is an option that a homeowner elects to pursue, it is highly recommended that the homeowner seek advice from an attorney. Often there will be additional financial consequences for homeowners that take this route.

Summary

In this article we examined and explored options that are available to owners of distressed properties. We looked at various Government Programs that are designed to assist in prevention of foreclosures. I cannot stress enough how important it is for homeowners to communicate with their lender when they are faced with this type situation.

If you reside in the Greater Atlanta Area, are in a distressed housing situation and would like a confidential meeting to discuss your options feel free to contact me. You may use the contact form on this page or you can call me at 770-318-2572.

Last Friday I attended the Short Sale and Foreclosure Resource Designation continuing education class that is currently being offered by the Real Estate Buyers Agent Council of the National Association of REALTORS. The purpose of the class was to help educate the participants with the latest information and show how real estate agents can best serve as a resource for both sellers and buyers of distressed properties.

Each seller who will potentially be involved in a short sale has a somewhat unique situation and set of circumstances. My job is to help you understand what your options are.

First Things First – The Terminology

Let’s look at the terminology, words and acronyms used to describe the foreclosure process as they relate to distressed properties in the Atlanta Market:

•    Foreclosure: The legal process by which a defaulted borrower is deprived of his or her interest in a mortgaged property
•    Pre-Foreclosure: The period of time beginning with the initial mortgage default up to the time when the distressed property is sold
•    NOD: Short for Notice of Default. This is the official notice from the lender notifying the borrower that they have defaulted on the mortgage. The NOD formally begins the foreclosure process.
•    Reinstatement Period: The timeframe stipulated in the Notice of Default in which the borrower has to reinstate the loan by making required payments and bringing the account into good standing
•    Short Sale: A short sale is a situation in which the seller (1) owes more on the loan than the sale of the property will likely produce and (2) is unable to bring funds to closing to satisfy the deficiency
•    Notice of Sale: If, after receiving the Notice of Default, the borrower does not or is unable to reinstate the loan, a Notice of Sale is recorded. The Notice of Sale explains where and when the foreclosure sale will be held
•    Foreclosure Sale: A foreclosure sale is when the property is auctioned off to the highest bidder. This is also referred to as a Sheriffs Auction, a Sheriff’s Sale or a Trustee’s Sale
•    REO: The acronym for Real Estate Owned. REO is the status of the property when the foreclosure sale is unsuccessful and the ownership of the property is transferred involuntarily to the lender

The Foreclosure Process

Pre-Foreclosure

•    The Borrower Misses Payments
•    The Lender attempts to Contact the Borrower
•    The Lender sends The Notice of Default (NOD)
•    If the Borrower does not Reinstate the Loan within the required timeframe the Notice of Sale is Recorded

Foreclosure

•    The Foreclosure Sale is conducted

REO

•    If the foreclosure sale is unsuccessful, ownership in the property is transferred involuntarily to the lender and the property is now Real Estate Owned

How I Can Help

My goal is to be a resource for distressed homeowners in the Greater Atlanta Market by helping them understand what options are available. I can also guide them to Foreclosure Avoidance Counseling which in many cases is free. Due to Georgia being a Non-Judicial Foreclosure State, time is of the essence regarding working towards a solution in a short sale or pre-foreclosure situation. To be totally blunt, in the State of Georgia there is an express lane to the foreclosure sale. If you know of anyone who can use this service, please don’t hesitate to contact me.

Atlanta Short Sale and Foreclosure Information Part 2
Take a look at The Options Available

Atlanta Short Sale and Foreclosure Information Part 3
The Anatomy of a Short Sale

Atlanta Short Sale and Foreclosure Information Part 4
An Effective Short Sale Package

Atlanta Short Sale and Foreclosure Information Part 5
What Buyers Should Be Prepared For and The Role of a Short Sale Buyers Agent

A year ago we celebrated as Tessa was evicted from her temporary residence. Friends and family gathered Saturday to celebrate her first birthday. I think it is obvious that Tessa had a good time. Happy Birthday Tessa!