10 Celebrities Facing Foreclosre
Times are hard no matter who you are. Most of the market is dominated by short sales or foreclosures. Here are a few A lister's that seem to have run into some financial woes too!
http://www.zillow.com/blog/10-celebrities-flirting-with-foreclosure/2011/03/23/
As always, please contact the Twin Cities Short Sale Realtor to discuss your personal situation.
Interesting Real Estate Facts
19 Interesting Real Estate Facts:
Fact 1: 11 % of all US homes are vacant.
Fact 2: Homeownership rate has dropped to 1998 levels.
Fact 3: Home prices are falling again..as we predicted last year…the housing double dip is here. Many economists expect further price (value) depreciation in 2011. Depending on the market and the price range….expect 5-10% additional value loss.
Fact 4: From the peak in 2006 US homes are expected to have lost close to 40% + in value nationwide.
Fact 5: In 2010 repoed homes reached the 1 million mark. A new unfortunate record.
Fact 6: 72% of the major US metro areas had an increase in foreclosures in 2010 over 2009.
Fact 7: 8 million Americans are at least one month behind. We know that when an owner is just ONE PAYMENT behind the probability of default skyrockets. Today’s one missed payment (30 day late) is tomorrows foreclosures (or short sale).
Fact 8: 5 million are at least 2 months behind. (See point 7.)
Fact 9: This year, 2011 an estimated 20,000,000 will be underwater, that’s 40% of all owners with a mortgage. The hardest hit areas of the country have simply stunning rates of negative equity: 67% in NV, 49% in AZ, 46% in Florida. 4 million US Homeowners are underwater by more than 50 percent.
Fact 10: New ghost towns are forming, Dayton Ohio 18.9% are vacant, Las Vegas whole towers of condos are simply empty.
Fact 11: THIS is officially the worst housing market in US History. Prices have already fallen MORE than even The Great Depression. 26% vs 25.9%
Fact 12: 4.2 million are unemployed for 1+ years. 9.6% are unemployed. Only 47% of working age Americans have a ft job
Fact 13: Lending requirements are getting rougher...
Fact 14: No equity..no downpayment. Last 2 years Americans have withdrawn 311 billion from savings and investment accounts. American’s are feeling broke.
Fact 15: Save Housing Fatigue has settled in over Washington D.C. President Obama didn’t mention housing once in the State of the Union. Compare that to just 2 years ago when DC was all aflutter with new housing initiatives. Is it time we talk about something that will truly make a difference..like a ‘Radical Refinance Program’ whereby owners negative equity is wiped out and they can keep their homes?
Fact 16: The American mindset about homeownership has shifted. After so many have been burned by homeownership its safe to assume that they will be very reluctant to dip their toes back into the water. Expect a continued increase in demand for rental units.
Fact 17: Social stigma of doing a strategic default is gone. People are now making the same business decisions that banks and other large investors do when underwater on investments.
Fact 18: The real estate industry is contracting. Fewer everything.. from loan officers to real estate coaches are needed. This trend won’t turn around until the baby boomers kids start having kids of their own. 7-10 years from now before we see a significant shift in housing demand due to the changing demographics.
Fact 19: Like in any consolidating industry there will be fewer operators doing more transactions. As more people leave the real estate industry the remaining agents, LOs etc will do MORE transactions.
Please contact us for a free consultation on your personal situation.
**These facts were made available from Tim and Julie Harris.
New Mortgage After a Short Sale or Foreclosure
Waiting Period For A New Mortgage After Short Sale/Foreclosure Changes:
Fannie Mae announced changes to the policies regarding the amount of time that must elapse after a borrower experiences a preforeclosure event (preforeclosure sale, short sale, and deed-in-lieu of foreclosure). The changes highlighted the importance of borrowers working with their servicers to avoid foreclosure.
Currently, the waiting period that must elapse after a borrower experiences a foreclosure is seven years. However, Fannie Mae allows a shorter time period – five years – if certain additional requirements are met (e.g., minimum down payment and credit score, and occupancy requirements). These requirements are being modified to remove the five year option. Unless the foreclosure was the result of documented extenuating circumstances, which only requires a three-year waiting period (with additional requirements), all borrowers will now be required to meet a seven-year waiting period after a prior foreclosure to be eligible for a new mortgage loan eligible for sale to Fannie Mae.
The following table describes the waiting period policy changes for foreclosures:
The following table summarizes the waiting period requirements for all significant derogatory credit events.
Continued...
Please contact us at the Twin Cities Short Sale Realtor if you have any questions.
Mortgage Debt Forgiveness Act
The Mortgage Forgiveness Debt Relief Act and Debt Cancellation
If you owe a debt to someone else and they cancel or forgive that debt, the canceled amount may be taxable.
The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.
This provision applies to debt forgiven in calendar years 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exclusion ($1 million if married filing separately). The exclusion does not apply if the discharge is due to services performed for the lender or any other reason not directly related to a decline in the home’s value or the taxpayer’s financial condition.
Although you'll want to double check with your accountant, see http://www.irs.gov/individuals/article/0,,id=179414,00.html for more information or contact us today to learn more.
Does A Bankruptcy Ruin A Short Sale?
Bankruptcy and a Short Sale:
Every so often I run into a short sale where the seller recently filed bankruptcy. In some instances, the lender is unwilling to consider a short sale after a bankruptcy is filed and/or a discharge is obtained.
Although I am not 100% sure, I believe the reason for this is because negotiating a short sale is considered a collection activity on a debt, which is forbidden during bankruptcy.
This definitely brings up an interesting point that if the above statement is true, why do some lenders still consider short sales and others do not. To be honest, I'm not exactly sure. I've had recent experiences where an owner has a first and second mortgage with the same lender and the first mortgage would approve the sale and the second would not because of the bankruptcy. You would think that the internal policies would be the same within the same company even though they have different departments.
In any event, the bankruptcy may ruin the chances of a short sale, but it may not. Until we make an effort to contact the lender and ask for a consideration of short sale, we won't know what they are willing....or unwilling to do.
Please contact us if you would like to pursue a short sale on your home, before, during or after your bankruptcy process.
Lastly, please keep in mind that you should consult with your attorney regarding the effects of a short sale before, during or after your bankruptcy.