Solving the Knoxville Foreclosure Crisis
One Homeowner at a Time

Rick Smenner

RE/MAX Preferred Properties
[email protected]

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A Common Myth About Knoxville Short Sales: Banks don’t like short sales and prefer foreclosure

_AskTheExpertI recently talked to a Knoxville homeowner recently about a short sales. Her house was close to being foreclosed upon. She had thought about short selling the house. But, she had heard from her friends that banks don't really like short sales and never pursued the option. The fact is that banks are better setup for foreclosures. It is only with the recent historic drop in home values that short sales have more common. Read the rest of this entry »

Knoxville Short Sales And A Common Mistake Being Made

– On Knoxville Short Sales I see a lot of agents making mistakes on short sales property valuation. Lenders hire a supposedly impartial third party to value the property. Many of these people are evaluating 10 properties a day. There is very little quality control and usually no one checks their work. Because of that, I always try to meet them at the home when they are doing their inspection. I explain the history of the property and why it is selling for that price. Read the rest of this entry »

Knoxville Short Sales Does Fannie Mae Pursue Deficiencies?

From our "Ask The Expert" portion of our site we got the following question from a seller doing a short sale. Rick Smenner CDPE“We are doing a Knoxville short sale with one of the largest nationwide banks. I told them I wouldn’t do the short sale unless they specifically changed their short sale approval letter to completely release me from the deficiency. The short sale negotiate told me that Fannie Mae would not allow them to release the deficiency. I read somewhere that Fannie Mae doesn’t pursue a homeowner after a short sale. I don’t know who to believe. What do you think? Steve.” Here is the answer to Steve’s Question. Steve, in my opinion, you are being lied to by the people at the bank. Read the rest of this entry »

Knoxville Short Sales: A Common Myth On Escalating A Knoxville Short Sale File

We see a lot of agent's going about escalating a file the wrong way. It reminds me of the appeals process game in death row. Everyone has to go thru the appeals process. It drags on for years and years. After a while it simply becomes a game. I don't want to see short sale escalation turn into a "game." Treat the Short Sale Escalation Process like a sales process. Don't treat it like just another technical process that you do for no reason. Don't just escalate the file "because you felt like it." The reason you escalate a file is because the lender is making a bad decision turning down the offer. You feel, based on your superior knowledge of the property and the local housing market, that they will lose more money thru foreclosure. And you are moving the file up the chain to make sure they don't lose even more money. When you escalate a file, make sure you tell everyone that they are going to lose money if they don't accept the offer. Read the rest of this entry »

7 Myths About Knoxville Short Sales Part 2

In my previous post we covered the first 3 myths about Knoxville Short Sale. We will cover the remaining 4 in this post. Myth #4 – Listing My Home as a Short Sale is an Embarrassment It is understandable to have reservations about letting the world know that you owe more on your home than it is worth. However, according to recent estimates, more than one out of eight homeowners in the U.S. is in the same situation. You are to be congratulated for admitting you need help, taking action, and finding a professional who can work with you toward a solution. With recent estimates showing 40-60% of U.S. sales will be short sales or foreclosures, you are not alone. Myth #5 – Short Sales are Impossible and Never Get Approved This is a complete falsehood. Are short sales more difficult to execute? Yes. Do you, as a homeowner, need to learn about a new process? Yes. Are they impossible? Absolutely not. Read the rest of this entry »

7 Myths About Knoxville Short Sales Part 1

A short sale can be an excellent solution for homeowners who must sell and owe more on their homes than they are worth. Unfortunately, a number of myths about short sales have developed, and it is important to understand the reality of this process should you find it meets your current needs. 7 myths about Knoxville Short SalesMyth #1 – The Bank Would Rather Foreclose than Bother with a Short Sale This is one of the most common misconceptions. The reality is that banks do not want to foreclose on your property because the foreclosure process is incredibly costly. Banks, investors, and even the federal government have all publicly stated that if a person is qualified for a short sale, the deal needs to be considered. Overwhelmingly, banks receive more on their investment through a short sale than a foreclosure. Read the rest of this entry »

Knoxville Short Sales: Do Short Sales Really Take 6-8 Months?

We just put together an offer on one of our Knoxville Short Sales. Our buyer asked us is the really going to take 6-8 months to get this approved and closed? I told him I don't think it would take that long why do you ask? He told me he had an offer on another property and the other agent told him it would take that long. After 6 months he walked away because he didn't see any progress with the lender and got tired of waiting. We see a lot of agents quote 6-8 months for a short sale response. Those agents simply don’t know what they are talking about. We have processed short sales with the most difficult lenders in an average of 2-3 months. The key is aggressive follow up. You have to check on the status of the file twice a week. Read the rest of this entry »

Knoxville Short Sales What Does I Mean When The Bank Says File Is Going To Investor Soon?

"One of our sellers we were doing a short sale in Knoxville asked us, what does it mean our short sale has been submitted to the investor?"

Here is the answer. It means that whoever ultimately owns the loan will make the decision. For example, you might be negotiating the short sale with Wells Fargo. However Wells Fargo may not own the loan. (Around 80% of all the loans they service are owned by someone else.) Wells Fargo will take all of the short sale documentation and send it to the actual loan owner. (The actual loan owner could be anyone from Fannie Mae, Freddie Mac, Goldman Sachs, a Pension Fund, or another Wall Street Entity.) That loan owner will review the short sale file themselves. Then, they will either approve the short sale or deny it. If they deny it, then they will usually let you know why. Then you can find out the reason they denied the short sale and re-apply. Often they want more money for the house, a missing document, of some other item. It is a popular misconception that banks own all the loans they handle. Little do most people know that most loans have been sold to a third party. Many experts agree that this was actually a good thing because it spread the losses across a lot of different people in the economy. If all the losses has been with 3-4 large banks, then those banks would have experienced crippling losses. Thinking about a  Knoxville short sale? I can help you short sale your property all me for a free consultation. You have options other that foreclosure. Don't trust your situation to an untrained professional it takes a great deal of skill to get a short sale accepted. We have the most experienced team in the Knoxville area so call me at 865-696-9002 or email me at [email protected].

How Does A Knoxville Short Sale Or Foreclosure Affected My Credit Score?

How do foreclosures, or short sales affect a credit score? Your credit score will be affected by late mortgage payments and a short sale. However, there are 2 things that are considered horrible on your credit report. Those 2 are items are foreclosure and bankruptcy. A foreclosure or bankruptcy will almost immediately lower a credit score by around 100 to 120 points. (The number is not hard and fast – it all depends upon what the score was before the foreclosure, and other factors that the credit bureaus don’t like to share.) The way that they write the algorithm, a foreclosure will keep on pushing your score down for the next 2 years! A foreclosure can also stay on a credit report for 7 years. Short sales are different from a foreclosure. Short sales  by themselves do not hurt a credit score (depending on how they are reported.) It is the missed payments that ding your credit report. How a short sale is coded/reported to the credit reporting bureau does make a difference in the affect it has on your score. It could be reported as a charge-off, a 120 day late payment, or a settled account. Any of these are dings on the credit report, averaging 100 points. Here is the good news. The way they do the algorithm, it will damage your score for a shorter length of time than the 2 years a foreclosure does. How a short sale is reported to the credit bureaus is something that can be negotiated as part of the process of the sales negotiations. Good negotiators can have a positive impact here. But, in the end, the credit score should not be the first thing to consider when facing the decision to short sale a home. You need to look at what is best for your family financially. The credit score is secondary to that. Get advice from a trusted source, and then make an informed decision. Need help in making an informed decision give me a call at 865-696-9002 or email me [email protected]

Knoxville Short Sales: A Little Known Fact About Short Sale Negotiators

You see, we've spent the last few years figuring out all the guidelines for Knoxville  short sales. If the loan being shorted is an FHA Loan, VA Loan, Fannie Mae Loan, or Freddie Mac Loan, then the guidelines for the short sale are different. In this case, the loan being shorted was an FHA loan. Here's what happened. FHA puts out a letter called "Mortgagee Letter 2008-43." It details exactly how the lender handling a short sale on FHA’s behalf is supposed to negotiate on a short sale. This letter is 16 pages long and gives them specific directions on how much to pay agents, what percentage of the appraisal they can accept, etc. (If you're doing an FHA short sale, then Google "Mortgage Letter 2008-43.") Because of a prior horrible experience on another FHA short sale, we had studied up on the FHA short sale guidelines. Bottom line, we know a little bit about FHA's rules for short sales. The problem was that this short sale negotiator didn't want to follow the rules! Instead she made up her own rules! She told me that they wouldn't pay any of the buyers closing cost. But the FHA guidelines for a short sale say that up to 1% of the purchase price can be paid for closing cost. This short sale negotiator wouldn’t budge. We had to argue back and forth with her for 2-3 days until she finally relented. It is pretty frustrating when a large bank won’t follow the specific short sale guidelines laid out by the owner of the loan. If the loan owner gives you specific instructions on how to negotiate a short sale, then follow those instructions! Before you hire a short sale agent, make sure they understand the guidelines for your type of loan. That way, when a short sale negotiator tries to break the rules, they can keep them in line. You do have options as a Knoxville homeowner who may be facing foreclosure. Don’t let your home go to foreclosure call me at 865-675-8326 or email me [email protected] let’s setup a time to talk about your situation and talk about your options. I’m here to help you as a trained Realtor with the CDPE designation I can help you… Also Read 7 Steps To A Successful Knoxville Short Sale Part 1 Part 2 Part 3 Part 4 Part 5

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