July 2010 Pinellas County real estate stats

July 2010 Market Stats Click Here

Some interesting things to notice here with the housing stats, the number of available single family homes in Pinellas County is up for the 1st time based on a year over year comparison since 2007. July 2009 active listings in Pinellas County were 6,525, July 2010 6,675 that’s a +2% increase. Sales were also down by -23% from July 2009. This I fell is due to the huge number of sales over the last 4 month where sold homes were up from 2009 number ranging from +7.5% to +31.5% this was due to the tax credit.

If you have any questions about the real estate market in your neighborhood in Pinellas County call us!

The tax credit expired, but it’s still a great time to buy a home thanks to low mortgage rates and motivated sellers. Here are five reasons why now is a great time to buy:

1. Low mortgage rates serve as an equity shock absorber. When buyers borrow at today’s record-low rates, they start building equity as soon as they close. That means they can absorb a few ups and downs as the still-recovering housing market gains traction.

2. Houses are in move-in condition. Homeowners continue to spend on maintenance and repair, according to the Harvard Joint Center on Housing. As these houses enter the market, they stand in marked contrast to tattered foreclosures.

3. Terrific houses are coming on the market. Foreclosures are finally starting to clear the system, and they are being replaced by some very attractive properties.

4. Appraisal regulations are finally aligned with market realities. Fannie Mae has adjusted its appraisal guidelines, giving appraisers more flexibility to set values that reflect the current market.

5. Plenty of programs. Many programs that encourage middle-class families to buy homes still exist, despite market downturns. Buyers who qualify can get a big boost by combining one of these programs with today’s low mortgage rates.

Source: ForSaleByOwner.com (07/29/2010)

PALM BEACH, Fla. – July 28, 2010 – With today’s reduced property values and increased unemployment, it’s tempting for some homeowners to just throw their hands up in defeat, allow the bank to take their home in foreclosure and rid themselves of the monthly mortgage burden.

Even suffering through the paperwork and stress of a short sale may seem too much for an overwhelmed borrower to handle.

But Florida homeowners should be aware of unique rules in the state that make the benefits of a short sale typically outweigh the ease of walking away in a foreclosure.

“I want to be very clear on this, short sales are a better solution than a foreclosure, even when all the options in a situation where you lose your house are not great,” said Mark Greene, owner and president of Short Sale Operations LLC in North Palm Beach.

The biggest difference between Florida and many other states when it comes to losing a home is the deficiency judgment.

While some states ban lenders from collecting the remainder owed on a loan after a foreclosure or short sale is completed, Florida law allows banks to go after borrowers for up to 20 years. That can lead to a garnishment of wages long after the home is gone.

In a short sale, where the bank agrees to take a lesser amount for the home than what is owed on a loan, lenders sometimes are willing to write off the deficiency on the front end.

Greene said in 90 percent of the cases he handles, the bank has waived its right to seek a deficiency.

That was the case with Jupiter resident Kathryn Lorello, who in 2008 found herself in a home she couldn’t afford.

Following a divorce, and with three children, Lorello bought a $408,000 home that she lived in comfortably for a year. But then she lost her job as a manager of a real estate company.

She remembers the day the bank served the notice of foreclosure.

“I cried my eyes out,” Lorello said. “That’s when I panicked because I really didn’t want it to happen.”

Lorello got advice from Greene on doing a short sale.

Her bank, Wells Fargo, waived its right to seek a deficiency even though it ended up taking $200,000 less than what was owed on the loan.

Also, if a bank refuses to waive the deficiency in a short sale, it still would have to go back to court to seek a judgment.

In a foreclosure, at the end of the proceeding, a deficiency judgment is automatically awarded by the courts and the bank is free to seek a claim.

“In the past, people just wanted to move from the property and get on with their lives and didn’t understand what the lenders’ rights were in terms of pursuing a deficiency claim,” said Paul Baltrun, director of loss mitigation at the LaBovick & La-Bovick law firm.

“I think people are more aware now about what can happen after the fact and that their nightmare can continue.”

Another consideration is the effect of a foreclosure or short sale on credit.

According to the Fair Isaac Corp., which developed the widely used measurement of credit risk called a FICO score, the negative effect of a foreclosure is only marginally worse than a short sale.

But in Florida, a deficiency judgment from a foreclosure is likely to have a much larger impact that will prohibit your ability to buy another home for many years.

Daniel Poulos, a mortgage broker with Elite Lending in North Palm Beach who has studied the effect of foreclosures and short sales on credit, said unless a borrower pays off the deficiency, it may be 20 years before someone is eligible for another mortgage.

“That’s the kind of information that’s not getting out in Florida,” Poulos said.

There are a few situations where some experts believe it is better for someone to go to foreclosure rather than do a short sale.

To do a short sale, a borrower must give all of his or her financial information to the bank before it will decide whether to allow the short sale. The idea is that if a person can afford to pay the mortgage, the short sale may be denied.

“Now the lender knows everything about your finances and they can better decide whether they will go after you or not,” said Jon Maddux, CEO of YouWalkAway.com, a company that advises people on strategic defaults.

If a lender doesn’t know your finances, Maddux argues, it reduces the chances it will go after you following a foreclosure.

“You might fly under the radar,” he said. “With the millions of people going through this, they are probably going to go after the low-hanging fruit.”

John Fenech’s
Lending Reminders:

FHA Financing
• FHA maximum loan in Tampa Bay $292,500
• FHA down payment needed from borrower 3.5%. All of this can come from a family gift.
• FHA seller concessions currently at 6% of purchase price
• FHA processing time for SLS is approximately 30 days.
• Owner occupied only

VA Financing
• Maximum loan amount in Tampa Bay $417,000
• 00000 money down required
• Closing costs and prepaids can be paid by seller to 4%
• Limit borrowers escrow money because normally no money allowed back.
• Owner occupied only

Conventional
• Maximum loan amount is $417,000.
• Minimum down payment is 95% loan to value
• Borrower MUST have their own 5% into the transaction prior to gifts being used unless the gift is 20% of the purchase price or more.
• Rate adjustments for loan to value and credit scores
• Owner occupied, second homes, investor loans.

For more info on lending requirements call John at 727-827-1818

”Click Here to Down Load Amortization Table”

This is a great tool I’ve created for you to use. Download the Excel document and play around with how you could reduce your 30 mortgage by making additional principal payments.

By just making an additional $100 per month principal payment you can reduce your 30 year mortgage by 5.5 years WOW!

Leave a comment if you like this tool and tell a friend.

To encourage distressed borrowers to agree to deeds-in-lieu of foreclosure, Fannie Mae is reducing the waiting period — from four years to two years — for them to become eligible for a new mortgage.

The new policy, which will apply to loan applications submitted after June 30, requires a minimum downpayment of 20 percent from borrowers who have agreed to a deed-in-lieu within the past two years. Borrowers with a deed-in-lieu in the past two to four years will be required to put 10 percent down to be considered for a Fannie Mae-backed loan.

Borrowers who lost their homes due to “extenuating circumstances” beyond their control — such as the loss of a job, illness or divorce — can put as little as 10 percent down after two years.

Those loan-to-value ratios will also apply to borrowers who have been involved in short sales and who were already subject to a two-year waiting period.

Bankruptcies and foreclosures are expected to damage millions of borrowers’ credit scores, leaving many unable to obtain a mortgage for years to come (see Inman News series: “Rebuilding homeownership”).

Fannie Mae generally requires five years for borrowers to re-establish credit after a foreclosure, but they may qualify in as soon as three years if they can document extenuating circumstances. The minimum wait for borrowers who have filed for bankruptcy is two to four years, depending on the type of relief sought.

Fannie Mae said the waiting periods for borrowers who have declared bankruptcy or been foreclosed on will remain in effect, and issued new guidance on requirements for re-establishing credit after a bankruptcy, foreclosure or deed-in-lieu of foreclosure.

After the waiting period has passed, only borrowers with traditional credit will be approved for loans, the policy said — nontraditional credit or “thin files” will not be accepted.

Borrowers who have filed for Chapter 7 bankruptcy liquidation must generally wait for four years after closure of the bankruptcy proceeding before Fannie Mae will consider them for a loan. The waiting period can be as short as if extenuating circumstances can be shown.

Those who have paid off all or part of their debts through a Chapter 13 bankruptcy filing may be eligible within two years of having their cases discharged. If they fail to complete their Chapter 13 plan, they are required to wait four years after their case is dismissed.

A record number of desperate borrowers have registered for a traveling mortgage relief marathon that “sounds too good to be true.”

The Neighborhood Assistance Corporation of America’s Save the Dream Tour opens 9 a.m. Thursday at the Miami Beach Convention Center, offering thousands of struggling homeowners a chance to modify their loans – at no cost.

The event, which offers free counseling and face-to-face contact with lender representative, runs 24 hours a day. Doors close at 8 p.m. on April 19.

Bruce Marks, CEO of the Boston-based nonprofit, said Wednesday morning that a company record 15,000 had already registered for Thursday’s event.

“We’ve had a huge response,” he said, even though the tour made a stop in West Palm Beach just last February.

Darren Duarte, spokesman for NACA, said the overwhelming number of people who showed up for help in Palm Beach County led the tour, which makes stops around the county, back to South Florida.

“During the last day the crowd was extremely large and we got to see a lot of people but there were a lot of people we didn’t get a chance to see,” Duarte said about the February event. “So we saw there is still a need here and a demand here.”

More than 24,000 applied for mortgage relief at the Palm Beach County event, leading to nearly 11,000 modifications, Duarte said.

Greg Calley said he was among those who benefited. The American Airlines mechanic said he was poised to short-sell his Jupiter townhome after a year of trying unsuccessfully to work with Chase to modify his loan, which he struggled to pay.

Then he heard about Save the Dream.

“I thought it was too good to be true,” he said, echoing a common skepticism about whether the nonprofit really can help mortgage holders receive a free, same-day loan modification.

But Calley said that by the time he left the Palm Beach event, his monthly payment was $1,000 cheaper and his interest rate reduced by 4.5 percentage points.

The tour’s arrival in South Florida comes on the heels of a month that set a new South Florida record for property repossessions in March, with 3,707 in Broward, Miami-Dade and Palm Beach counties, according to a report by real estate consulting firm CondoVultures Realty.

Those who attend the workshop are encouraged to register and are urged to bring pay stubs, tax forms and other financial documents.

More info: http://www.naca.com

If you are like many American’s who purchase or refinanced their home during the heat of the real estate boom this could be the program that was designed to help YOU! Over the past 2 years I’ve been working to help many clients who have found themselves upside down and need financial help to correct their housing situation. It’s been a long and hard road for many of these good people whose lives have changed in one way or another.

Finally it looks like our government has taken a step in the right direction to streamline the process of helping these good hardworking people.

There are two program: The first is called HAMP, and this is how it works:
The Home Affordable Modification Program is designed to help as many as 3 to 4 million financially struggling homeowners avoid foreclosure by modifying loans to a level that is affordable for borrowers now and sustainable over the long term. The program provides clear and consistent loan modification guidelines that the entire mortgage industry can use.

Borrower eligibility is based on meeting specific criteria including:
1) borrower is delinquent on their mortgage or faces imminent risk of default
2) property is occupied as borrower’s primary residence
3) mortgage was originated on or before Jan. 1, 2009 and unpaid principal balance must be no greater than $729,750 for one-unit properties.

After determining a borrower’s eligibility, a servicer will take a series of steps to adjust the monthly mortgage payment to 31% of a borrower’s total pretax monthly income:

•First, reduce the interest rate to as low as 2%,
•Next, if necessary, extend the loan term to 40 years,
•Finally, if necessary, forbear (defer) a portion of the principal until the loan is paid off and waive interest on the deferred amount.
Note: Servicers may elect to forgive principal under HAMP on a stand alone basis or before any modification step in order to achieve the target monthly mortgage payment.
The Home Affordable Modification Program includes incentives for borrowers, servicers and investors – For More Info Click Here

If you can’t complete the HAMP program for one or a number of reasons than you maybe (should be able to) go in to the second program call HAFA.

Here is the info on HAFA: How HAFA Can Help

The Home Affordable Foreclosure Alternatives (HAFA) Program was designed to complement the Home Affordable Modification Program (HAMP) by helping current homeowners with mortgage debt who are eligible for HAMP but still cannot keep their home.

When a borrower applies for help from HAMP, not everyone succeeds with the program. Sometimes their lender is unable to approve a loan modification. Other times the borrower declines the terms of the loan modification. Some borrowers are approved and accept the terms of the modification, but fail to complete the program for various reasons. Before HAFA, these borrowers were usually headed for foreclosure.

HAFA gives those borrowers a viable alternative to foreclosure. If they have or want to find a buyer for their home, they may request approval for a short sale with pre-approval short sale terms and minimum acceptable net proceeds. If not, they may request approval for a deed-in-lieu . When a borrower applies for help with one of the HAFA solutions, the program already has their financial and hardship information from their HAMP application.

HAFA also imposes limits on the lender to help the borrower. Under the terms of this program, a lender must release the borrower from all future liability for the first mortgage debt. The lender may not ask the borrower for cash or a promissory note, and the lender may not ask a court for a deficiency judgment. The program also prohibits the lender from asking the listing real estate agent to discount their commission at the closing of a short sale.

All documents have been standardized and procedures, time frames, and deadlines have been streamlined under HAFA to make the process easier for both borrowers and lenders.

HAFA also provides financial incentives for both borrowers and lenders to participate in the program. Borrowers are entitled to receive $1,500 in relocation assistance , to be paid at closing. Lenders or loan servicers may receive up to $1,000 to help with administrative costs. There are also financial incentives for the lender or investor on the first mortgage to allow some of the proceeds from the sale of the property to be paid to subordinate lienholders.

Finally, participation in the HAFA program puts the foreclosure process on hold for the borrower. The lender may initiate the foreclosure process, but if the borrower is in the middle of the application process, or if any approved short sale or deed-in-lieu agreement has not been completed or reached its deadline, the lender may not complete the foreclosure process.

For more information Click Here

There are a lot of people who need this information so please forward to a friend or RT on twitter

Before I get stated I want to admit I have a real estate problem! I spend 8-10 hours most days working as a Realtor and when I come home I’m either reading real estate magazines, researching how to get more traffic to my website or writing blog posts, all of course after I play with Mackenzie and put her to bed. For downtime I love yard work or build things and I watch HGTV, love watching the shows where the agents list and sell homes in different parts of the country.

Last night there was a show where a young couple owned a 1 bedroom two story townhome just under 1,000 sqft. They hired an agent Sean who ran some comps and gave them a vale of $182-$182,500 as a selling range. They listed the home for $189,900 and within a short time received an offer for $175,000.

After going over the offer it was the seller who asked if a counter offer would be appropriate! The agent who should have been looking out for his clients hesitated, saying “You can but you run the risk of loosing the buyer” One thing I’ve learned over the past 13 years in this business is when a buyer makes an offer on a home they are emotionally attached to the property! Also, 80% of buyer’s who make an offer, make a low offer to see how the seller is going to react.

If the seller is confident in their asking price and they have good comparable sales to back it up, my advice would be to counter at almost full price or at the top end of the comps, expecting the buyer to then make a counter. This is part of the negotiating, if you don’t do this either part may feel like they have lost something.

Buyer & sellers don’t typically want to take advantage of the other part, they just want to now they got the best deal they can get. At the end of the day paying $5-$10,000 more for a home in the long run is such a small number added to the monthly payment. (Rule of thumb if you pay $5k you borrow your mortgage will go up $25 depending on the interest rate.

The seller’s agent didn’t seem confident in the price or negotiating and it almost seemed to me he may have been more concerned about making the deal happen than providing the seller with sound advice.

The main reasons people hire real estate agents is because they want someone with knowledge and experience to advise them on the best cause of action when buying or selling a home. They also need marketing to expose their home to all potential buyers. Emotions run high when buying, selling and negotiating. I think everyone would agree they don’t like buying a new car, because you have to dealing with a trained sales person who knows what buttons to push to get you to pay more for a car.

Real estate agents should remain unemotional! (I do say, should) The advice given on this show last night was to make a counter offer, splitting the difference from the buyers offer and the asking price which was $182k was in my opinion this was bad advice because the sellers wanted to get $182k. The obvious next move from the buyers would be to then split the difference again. Which is what happened, the buyers made a counter of $179,000 the sellers were then under pressure because they didn’t want to loose the buyer. Their agent suggested a counter of $179,750 (who comes up with a counter for $750 more?). They made a counter and the buyer accepted. The seller effetely sold the home under the comps by almost $3,000 which for these guys was a lot of money.

The other big issue was the home inspection, the seller knew the heating system was making a strange noise when they listed the home. Asking questions at the time the listing was taken could have saved the seller over $1,700 for a new heater. If they would have purchased a home warranty for a little as $400 they would have been protected. But the sellers ended up having to buy a new heating system for the buyers.

The conclusion to this is when hiring a real estate agent find someone who has been in the business for sometime in your area, someone who knows how to negotiate and is confident in your asking price. Don’t overprice your home in today’s market buyers have access to all kinds of data from the property appraiser office, zillow.com, cyberhomes.com and the sold data from the MLS.

If you found this info useful leave me a comment or forward to a friend.

According to the national association of Realtors only 11% of the American public knows about the real estate tax credit. WOW! I’m shocked it so low!

If you have not heard the government is offering an $8,000 & a $6,500 tax credit to buyers who buy a home.

The $8,000 is for 1st time buyers, this doesn’t mean you have to be a true 1st time buyer an example could be own a home and moved out 3 years ago, you rent the home and have been renting for 3 years.

The 2nd credit is for people who own and want to move, example you purchased a home in 2000 and now want to move.

If you are under contract before April 30th 2010 and close on or before July 30th 2010 you could qualify for the tax credit for more info check out www.IRS.gov for more info.

If you know anyone who is renting right now, please pass this info on to them and ask them to consider buying as this is a buyers market and interest rates are low. However we are seeing in most areas of Pinellas that homes in good condition under $200,000 are going fast, homes under $100k in good condition and not short sales are like gold! No time to think or to pray, if you find something you like you need to act fast.

I’ve been showing homes to people who rent and they feel the will be saving money by buying now!

Don’t forget to check out our MLS Search from the main page. If you need any help or advice call me anytime.