A Common Knoxville Short Sale Case Mistake: Hiring An Agent With Little Short Sale Experience
Short Sales in Knoxville, TN? What is a short sale? A few years ago most agents didn’t understand short sales. They didn’t want to get involved on them because of the extra work required..
Short sales take two to three times as much work. The extra effort can be draining at times. Some agents openly admit that they hate short sales.
Is that the type of person you want working for you? Others believe it is wrong for a seller to walk away without a deficiency judgment. “I have heard some agents say that people should be able to walk away from their “obligations.”
Do you think that type of agent is going to push hard for the bank to waive a deficiency?
Knoxville Short Sales: My Ex Is Short Selling. What Can I Do?
“My Ex-wife decided to Short Sell our former Knoxville house. Unfortunately we both signed the mortgage when we bought the house together. I think that means I am still liable for the debt.
She got the home after the divorce. The court gave her the home in the divorce. The market has declined and the house is worth about 120k less than the mortgage amount.
I have a good job and some assets. Will I have to pay back the bank all the money they lose. (My ex is selling because of financial problems.)
Also, someone said I might have to pay income taxes on the written off debt. Is that true? Please help me out here. Sincerely, Tom.”
How Soon After A Knoxville Short Sale Or Foreclosure Can I Buy A Home?
If I Short Sale or let my Knoxville home go to foreclosure will it be before I can buy a home again? This question was asked on our “Ask The Expert” area.
Wondering if you’ll ever be able to buy again?
One thing we are finding is those who have been through a foreclosure will wait longer than those who did a short sale.
Fannie Mae and Freddie Mac stipulate that persons who had their homes foreclosed must wait a minimum of three years before being able to apply for credit with them again, while those who went for a short sale only need to wait two years. There can be extenuating circumstances however, and if borrowers are able to show how they were extremely unfortunate, and if they had a good financial track record in the past, they may be able to shorten the time they have to wait.
Are Loan Modifications Better For Knoxville Area Lenders Than Foreclosure?
There is a hidden secret in the foreclosure business. Many lenders are rejecting borrower’s loan mod requests. Then, they foreclose the house and sell it.
However, they lose more money from doing that versus if they had accepted the homeowner’s loan mod. Let me explain how this works.
Get my Free, Step By Step Loan Modification Guide by clicking here.
A person buys a house for $300,000. The local housing market declines and the house is now only worth $220,000.
The homeowner’s income drops. Now they can only afford to pay the equivalent of a $220,000 mortgage payment. They request a loan modification.
The lender turns it down. The house goes to foreclosure. Eventually, 18 months later the home is foreclosed upon. The homeowner moves out.
The lender lists the home for sale. Because of the continued decline in the housing market, the house is now only worth $200,000. But, it sells for $180,000. Why?
Knoxville Short Sale Is It Right For You?
Knoxville Short Sales have become more common in the last couple of years in the Knoxville market.
It’s not unusual for someone that bought their Knoxville home from about five years ago to call and ask me about doing a short sale. We all know that Knoxville has traditionally held its value in real
estate.
That said, what happens if you bought a house and you now owe a whole lot more then it’s worth, and that you know you will never balance out? Unfortunately, this is happening to many of us, and fortunately, we have options.
Most lenders ask to see some sort of “hardship” in order to approve a short sale on your Knoxville home. A hardship, traditionally, has been about loss in wages, divorce, illness, etc., but more and more, we are seeing lenders approve Knoxville short sales based on the very fact that the homeowners will always be underwater with the debt owed on their home.
Another consideration is the lender. Some lenders are easier to work with in approving short sales then others. Additionally, many of us took out home equity lines of credit when the housing boom was in full force. How much you owe on your second loan, and which lender it is with, will also play a role in whether or not a short sale is a viable option for you.
Knoxville Short Sale: I’m having a hard time negotiating with a HELOC
A Seller doing a Knoxville Short sale had a question for our Ask The Expert area of our site from a seller doing a short sale on his home.
“What is your experience with Chase Heloc’s? I have a HELOC that is a 2nd mortgage. Citi (the 1st) will give them 6% or approximately $3000. Chase’s collection agency is saying that they want 30% ($30,000.)
They won’t budge. They want this in CASH, not as a promissory note (in case the seller does a bankruptcy.) They are telling me they will just let the house foreclose because that is Chase’s policy now. What do you recommend that I do?”
A Common Myth About Knoxville Short Sales: Banks don’t like short sales and prefer foreclosure
I 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.
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.
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.
“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.
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.
