Tricks & Traps of Foreclosures - Buyer Beware!

 Considering buying a foreclosure? Here are some tips that may help. When dealing with a bank for an REO (Real Estate Owned) property expect tricks & traps at every junction. Here are just a few that you'll want be aware of.

- "AS IS WHERE IS" - Banks sell properties in a strictly as is condition. If you look at a foreclosure and it needs substantial work to make it livable, don't expect that the bank will make these repairs prior to closing. Anything short of an environmental or health hazard will ultimately be the buyers responsibility. Make sure your inspections are thorough even if it costs a bit more initially.

- "Real Estate Disclosures" - There aren't any! The bank has never seen or lived in the property and has zero knowledge of the history, prior or existing defects, or the surrounding areas. typically a Sellers Disclosure is obtained by a buyer prior to submitting an offer. Don't expect any from a bank.

- "Contract Terms" will change - Your initial offer may be accepted verbally however, soon thereafter you will receive a whole new set of documents & addendum's to review and sign ASAP if you expect the contract to move forward. You'll find that many of the terms, times and conditions are very different than what you thought was accepted. The only thing that is accepted is "price". All other conditions will be incorporated in the bank or investors contract. Take it or leave it.

- "Escrow Deposit"- You will likely be required to work with the banks chosen escrow and Title Insurance company. They will rush you for your deposits and afterward take their time on processing the required signatures and meeting deadlines. Typically they are slow and unorganized "Foreclosure Mills".



Have realistic expectations. Work with a Broker who is familiar with the process and potential complications. Call 561-306-6736 or email directly with any questions about buying a foreclosure.

Condos for Less Than the Cost of a New Car

With so many condos in South Florida available for less than the cost of an average priced new car it's no wonder I've been running my tail off this summer. Buyers with cash are taking full advantage of the overwhelming wealth of inventory now glutting the market. In many cases buyers are looking for deals on several at a time hoping to grab up a couple and make some extra cash monthly. Holding them a few years or more until the market stabilizes is not difficult since the rental market for inexpensive homes and condos is strong.

Cash is king in these instances. In many cases lower real estate values and stricter financing regulations make it difficult to obtain any financing on these condos. That together with the fact that foreclosure sales are often awarded to cash buyers with no financing contingencies. Some savvy buyers are building up a small inventory of real estate that may in fact become their financial salvation in the future. Others are just looking for ways to live inexpensively while maintaining ownership interest in property.

International buyers seem much more eager than domestics to snap some of these properties up. Seeing the advantages of having a place of their own when visiting the area and not being as affected by the economies in their countries they are taking full advantage of opportunities and benefitting from the seemingly unending depression of the American real estate market, particularly the one here in South Florida. Opportunities continue to pour into the marketplace. The tremendous backlog of foreclosures still being accumulated should allow this market trend to continue for some time to come.

If you or anyone that you know is considering buying or selling a property in Southeast Florida please contact me directly at 561-306-6736 or by email ges.rellc@ymail.com or rebuygeorge@yahoo.com

Homemade Mortgage Modification

An amazing phenomenon is occurring in households all across the nation. Growing numbers of people today are providing themselves with there very own homemade mortgage modifications. This type of financial remedy doesn't beg a lender for permission. With lenders and loan servicers either unwilling or simply not capable of helping with loan modifications, borrowers are just not paying and offering ultimatums. Lenders are being told either help me stay or force me out.

According to statistics published by LPS Applied Analytics, a company that provides services to many of the nations largest banks and financial institutions, the average borrower currently in foreclosure is delinquent some 438 days before being evicted. More than 650,000 households have not paid anything in 18 months and of those the lender hadn't even begun to take any action against nearly 20%. The numbers are staggering. The NY Times reports that 1.7 million foreclosure procedures have been initiated as many borrowers are choosing not to pay for something that isn't worth even half of what they owe on it. Any moral qualms are quickly dismissed by the belief that the banks created the situation and maybe now it's payback time.

Call it self preservation, selective foreclosure, or whatever term suits the situation. The fact remains that people are beginning to take charge of their own lives while lenders continue looking for ways to minimize losses. In some states lenders can pursue foreclosure outside the courts which can be a speedier process. In states like Florida, New York and others, judicial foreclosure is required. This slows the process considerably. Lenders seem to be more willing to allow time for some sort of alternative like a short sale in these states and generally, given the numbers on the horizon, may be reluctant to take many properties back at all.

For more info on foreclosures,short sales, buying or selling a property in SE Florida call me directly at 561-306-6736 or email ges.rellc@ymail.com
www.ges-realty.com

Lessons In Defining the Next American Dream

Housing prices peaked 40 months ago in May 2006. What have we learned from the great housing bubble and crash ?

Obviously, we have learned that housing prices can be extraordinarily volatile. No one can ever again say foolish things like housing prices never fall. People who bought with a standard mortgage in the years close to the boom have lost all of the equity in their houses. Buyers and lenders should never again think that an area’s recent price increases are the sign of a strong market where prices have nowhere to go but up. In the long run, price increases are followed by price drops, and caution needs to be taken in booming markets.

The second lesson of the housing debacle is that there is extraordinary pain in both housing busts and booms. When housing prices soared, ordinary Americans found it increasingly hard to afford a house. During the boom, many hoped that housing prices would stop rising and even decline, not understanding the terrible impact that declining housing prices would have. Large swings in housing prices, can be extremely painful.

The third lesson is that the response to the American housing crisis has been incredibly foolish. We've used public resources to encourage ordinary Americans to bet all they could on the housing markets. We have allowed billions of tax payer dollars to bail out of firms that had lost on those mortgage gambles. We continue to provide billions of tax payer dollars to the same institutions that were instrumental in creating the bubble that burst what once was the American Dream.

All of these "lessons " leave me wondering what the next American Dream will be.

Perhaps a much less volatile, more comforting lifestyle with a reassurance that we live in a country that cares for it's citizens emotional, financial and physical well being. That the people we've put in charge are truly capable of handling those responsibilities. That we the people and our families are the beneficiaries and not the victims of big business and big government.

For more on today's housing market call 561-306-6736 or email rebuygeorge@yahoo.com

1st Time Homebuyer Tax Extension Possible

Bills to extend the maximum $8,000 tax credit for first-time home buyers, which expires Nov. 30, are pending in both the U.S. House and the Senate.

Sen. Christopher J. Dodd, a Connecticut Democrat and chairman of the Senate Banking, Housing, and Urban Affairs Committee, is co-sponsor of a bill with Georgia Republican Sen. Johnny Isakson that would raise the credit amount to a maximum of $15,000.

Senate Majority Leader Harry M. Reid of Nevada favors an extension of the current credit.
He was quoted by the Las Vegas Sun saying, "It's something we can get done."

Odds are that the credit will be extended and broadened to cover all buyers next year, but the chances of the amount increasing aren’t as good, observers say.

Source: Washington Post Writers Group, Kenneth R. Harney (08/22/2009)

For more on the First Time Homebuyer Tax Credit contact me at rebuygeorge@yahoo.com

George Sinacori

Automatic MLS Updates

Now buyers and sellers can easily stay on top of their market areas.

Automatic MLS Updates are a way for you to gain access to MLS properties as soon as they hit the market. If searching homes in SE Florida is becoming tedious and you don't want to or aren't quite ready to work with a Realtor than you should use my Automatic MLS Updates system.

It's an easy to use system that asks you to submit your search criteria so that every time a new listing matching your search comes on the market you'll get it in your email. i.e.

1-Click on the Automatic MLS Update link

2-email the search criteria including,

-type of property (single family, condo, townhome, etc.)

-# bedrooms & baths

- Community or city in SE Florida

- Price range

- Any preferences such as pool, pets, schools, age restrictions

3-The criteria will be entered into an automatic update search and you'll receive emails with any new listings attached as they come available just like Realtors receive new listings every day.

Buyers and sellers can now get complete new listing information as soon as it hits the MLS.

Automatic MLS Updates

Protections For Renters Living In Foreclosed Homes

A bill passed by both houses and signed by the President on May 20, 2009 titled "Helping Families Save Their Homes" establishes among other provisions, some level of comfort for renters unwittingly caught in the foreclosure crisis. Many renting families have become victims of the foreclosure crisis by not knowing that the home is being foreclosed. Without warning they may be told that the home now belongs to the bank and that they have 48 hours to vacate. A provision of this bill finally addresses the problem and provides some security for renters of foreclosed homes. Helping Families Save Their Homes establishes protections for renters living in foreclosed homes.

According to Senator Dodd of Connecticut and a U.S. Senate publication: "One of the overlooked problems in the foreclosure crisis has been the eviction of renters in good standing from homes that go through foreclosure because owners of those homes, unbeknown to the renters, have not been paying their mortgage. The bill will require the bank that forecloses to honor the existing leases, for renters on a month-to-month basis, provide a 90 day notice. If the bank sells the property to an intended owner occupant, 90 day notice is required. Parallel protection are provided for Section 8 tenants.

Senator Chris Dodd is Chairman of the Senate Banking, Housing and Urban Affairs Committee.

Other provisions of the bill reportedly are designed to help prevent foreclosures and increase the availability of consumer and business credit. Some of these are listed as:

- Expand Access to Hope For Homeowners

- Increase funding for Foreclosure Prevention

- Provide New Resources for Homeless Americans

- Increase borrowing authority for FDIC and NCUA (National Credit Union Association).

For more information on this new legislation or answers to questions about buying selling or renting in Southeast Florida please call me directly at 561-306-6736 or email rebuygeorge@yahoo.com.

Free MLS searches and up to date information on how to buy or sell, including short sales and foreclosure are available at ges-realty.com

Foreclosure Trends in Southeast Florida

While the economy continues to struggle, home prices are still falling under the pressure of foreclosures and short sales. Here in Florida a staggering 11% of home loans are in some stage of foreclosure ranking it first in the country for defaults. With home values continuing to fall the foreclosure rate will surely increase through this year. Prices can't stabilize until the oversupply is at least equal to the demand. According to information provided by Zillow.com approximately 71 percent of homeowners in two Southeast Florida counties who purchased homes in the past 5 years are underwater or owe more than the home is worth. Lenders are finding that loan modifications aren't working as many borrowers fall behind again within a year of the modification. These are borrowers who may have escaped the foreclosure process but will return given time. According to information provided by RealtyTrac, preforeclosures still account for the largest piece of the foreclosure pie. This is the time that lenders, sellers and buyers should recognize as opportunity and take advantage of. This is the time to short sell and avoid the whole foreclosure mess.

The pie chart above indicates current foreclosure trends in Palm Beach county. Of almost 15,000 homes county wide in the foreclosure process 89% are in the preforeclosure stage. That of course does not mean that they will all be foreclosed or that they are all currently for sale. What it does mean is that there are still a lot of homes that need to be sold at current market prices.

Statistics provided by RealtyTrac over the most recent 2 quarters show that the largest decline in values in the county occurred in Boynton Beach and Stuart respectively while the lowest average foreclosure sales price was in Delray, West Palm Beach and Boynton. The total number of foreclosures sales in the county was up slightly in April. The greatest value being in a 3 bedroom home between $100K and $200K. These show the largest decline in price and the greatest number of available properties.

Being aware of market trends has always been important to anyone considering buying or selling a home. Today it's more important than ever. Understanding price trends can make or break a buyer. Current sales trends and the short sale process is key to a seller looking to get their life and finances back on track. Lenders need to streamline the process if they expect to minimize the loss. Todays market is primarily a short sale market and will be for the foreseeable future. The real estate market today is complicated. Buyers and sellers need good, solid, trustworthy information from an experienced reliable source before getting into it.

I encourage anyone in South Florida needing assistance with the process to call me at 561-306-6736, email me your questions or go to ges-realty.com for more information..

How Mortgage Relief Options Work

Loan Modification - Short Sale - Deed In Lieu - Forbearance

Forbearance -Temporarily suspends all or a portion of your monthly payment, followed by a formal plan using another option listed here to return your account to a current status. Your hardship is expected to be short term in nature, or you know that you will be able to pay a particular amount on a specific future date and continue with your payments from that point forward.

Repayment Plan - Adds a portion of past due amounts to your regular monthly payment until your account is current. Your hardship is expected to be short term in nature, and may even be over, and you have the ability to make an increased payment for a short period of time.


Partial Claim - Returns your account to a current status using funds from your mortgage insurer or guarantor. Your mortgage is insured and your hardship is short term. Subject to mortgage insurer or guarantor approval.

Modification - Makes your payment more affordable by permanently changing one or more of the terms of your original note and mortgage. Delinquent amounts can sometimes be added back into the loan balance. You can afford a reasonable payment that is less than your current payment and/or you don't have enough cash to bring your loan current.

Assumption - Transfers title to a credit-qualified buyer, even if your loan is non-assumable. You can not make any payment but want to avoid foreclosure.

Short Sale - Allows you to sell your home for its current value, even if it is worth less than what you owe when you can not make the payments but want to avoid foreclosure.

Deed-in-Lieu of Foreclosure - Transfers title to the property back to lender to satisfy the amount you owe. You can not make the payment but want to avoid foreclosure and you have had your home listed for sale for at least 90 days. This option is reserved for the most extreme situations and is subject to investor approval.

For more information or help with these options please call me directly at 561-306-6736 or send an email to rebuygeorge@yahoo.com .

Is Great Credit Still Important ?

It may seem like an odd topic for discussion or consideration at a time in our economy when overextended credit has gotten us into such a mess. If you've had a difficult time getting a loan lately it can be unsettling although there may be some comfort in knowing that your not alone. Because of the condition of the markets, getting a loan will become increasingly more difficult.

Our credit scores reflect our behavior as borrowers. You may not consider your credit score as important as it was a few years ago being that it's so difficult to get any these days. Credit and credit worthiness still matter for many reasons. You may eventually need a new mortgage because you're relocating for employment or for any number of reasons. You may need your good credit to send a child to college. You may need it to continue using credit cards because your income has fallen or disappeared for awhile. Your good credit may help get you through the difficult, unexpected times that seem to inevitably sprout up on us from time to time. We can't always know when our credit may be a factor but if a need to borrow becomes apparent it could be too late to repair any credit problems.

Our credit is something that we still have control over. We can see our credit history and credit report in the privacy of our own homes by going to annualcreditreport.com . A copy of your FICO score which is the combined credit rating from 3 reporting agencies is available also at myfico.com . Currently the median FICO score is 720 but that number may very well change in coming months. As more people default on loans the average or median score will get lower.

If your considering a new mortgage the rule of thumb now is the larger the down payment the better the rate as long as your credit is good. If you don't have a large down payment there are still good loans available. FHA insured loans require as little as 3% down even if your credit score is below average. It would be great if these conditions for lower scoring people were available for other types of loans. Until they are our credit score is crucial to our survival and we can protect it, improve it and preserve it.

Check your credit report for any possible errors. Look for accounts you may not recognize and report any discrepancy to the credit bureau. They could be an indication of identity theft. Report any incorrect late payment recordings or other derogatory errors that could negatively affect your score. They should respond to your requests in no more than 30 days. Preserving our credit may seem like an exercise now but at least it's something that we each still have complete control of.

For more information on FHA or conventional mortgage requirements or for the latest available mortgage programs and rates call or email George Sinacori 561-306-6736. Visit GES Realty online or any of my websites to search for a home in Southeast Florida.

July Home Sales Increase as Prices Decline

Homebuyers are taking advantage of depressed prices of existing homes. Home sales in July rose by 3.1% with many of the reported sales being foreclosed properties and private owners pressed to sell for less than they had originally paid for a home. The increase in sales is reported to be the largest single monthly increase since Feb. 2007.

Prices of existing or previously owned homes nationally were 7.1% lower in July than they were a year earlier according to the National Association of Realtors (NAR) as homebuyers took advantage of the lower prices and still favorable mortgage rates. Although sales have increased prices have continued to fall. The rule of supply and demand still applies and should continue putting pressure on prices as available homes for sale continue to outpace sales and more inventory comes on the market. . Anyone who does not need to sell quickly should wait until some of the dust settles before putting a home on the market.

Homebuyers may not want to wait to long on the other hand. It may be wise to grab up a property now considering some of the conditions that may affect buying ability or buying power over the coming months:

- On October 1 of this year FHA is required to have the ability to insure and refinance as much as $300 billion dollars in home loans for existing homeowners. This measure of the Housing and Economic Reform Act of 2008 could significantly reduce the number of homes entering the market over the last 3 months of this year.

- Interest rates are favorable now and may begin to rise as inflation becomes more of a threat.

- The First Time Homebuyer Tax Credit is available until June 30th of 2009. Taking advantage of buying this year allows the buyer to take that credit in 2008.

Anyone needing more information on available homes and prices in Southeast Florida can contact me directly either by phone 561-306-6736 or email at rebuygeorge@yahoo.com. You also may want to visit my website at ges-realty.com .

Can Bankruptcy Save Your Home?

At the end of the day there's just not enough money! The cost of gas, food, everyday living expenses and the mortgage are beyond manageable. You just can't keep up with the bills. Your always trying to play catch up, sometimes getting by with what seems like smoke and mirrors, until one day you receive the inevitable bad news. Your lender has filed a "Notice of Default" or "Lis Pendens", initiating a foreclosure action against you.

Now the wheels start turning. What to do? How can I stop the foreclosure? How can I keep the house? How can I get relief?

Should you decide to file personal bankruptcy there are a couple of bankruptcy filings that you'll become familiar with. Chapter 7 bankruptcy places an automatic stay on your creditors including your mortgage lender. The stay is temporary however and the lender can continue to solicit the court for relief from the stay. At anytime the court may grant that relief and the foreclosure than proceeds. At best a Chapter 7 may help buy time to sell or reestablish yourself with your creditors. It never stops a foreclosure.

Before filing for personal bankruptcy you will need to complete an approved credit counseling briefing. This can be purchased online at:

http://www.startfreshtoday.com/consumers-site/debtor-education.aspx

For a Chapter 7 filing you'll have to qualify through a Bankruptcy Means Test. Not to worry though, some statistics claim that 96% of all petitioners qualify. The means test is a 2 step process. Your monthly income compared to the median income in your state for a family of your size. If your below the median you qualify. If not you go to step 2 , calculating disposable income over the next 5 years. If it's less than $100 a month, you qualify.

In the unlikely event that you didn't pass the Chapter 7 means test you may still be able to file for Chapter 13. Many people looking to avoid foreclosure choose Chapter 13. It can give you the breathing room you need to get you back on track by combining the automatic stay with a payment plan over the next 3-5 years. Chapter 13 allows you to sit down with your creditors and arrange a payment plan. Once agreed and accepted your creditors, including your lender must abide by the plan. If all payments are made as scheduled, any unsecured debts may be discharge at the end of the plan. This type of filing is intended to help people keep keep their property while they catch up. Of course there will be court and attorney fees that the homeowner will need to pay as well.

In order to qualify for Chapter 13 you must have a regular scource of income and have enough disposable income to cover normal living expenses as well as pay the creditors. There are also preset limits for secured and unsecured debt which fluctuate periodically. i.e. the limit for unsecured debt may be several hundred thousand dollars and secured debt limits may be over a million dollars.

In the end there is no one right solution when it comes to financial difficulties. Whether or not someone chooses personal bankruptcy over another viable alternative depends on that person and the circumstances surrounding them. Call it a workout plan or financial reorganization. Anyway you look at it, avoiding a foreclosure may be the most important thing that anyone can do to save their financial lives.

For more on avoiding foreclosure call me directly at 561-306-6736 or email me at rebuygeorge@yahoo.com or visit my website at http://www.ges-realty.com/ for more answers.