You have resolved to do a short sale. Here is a check list of things you need to start working on while you are waiting for your house to get an offer.  You lender may not require all these things but you might as well get them all just in case.

IMPORTANT: Keep all originals for your files. Just bring copies to your agent. Remember, time is of the essence.

Financial Information

Three most recent bank statements for all checking accounts for all borrowers
Three most recent bank statements for all savings accounts for all borrowers
W2s from the past two years for all borrowers
Income tax returns from the past two years for all borrowers
Past three paycheck stubs for all borrowers
Copies of all bills for all borrowers from the past two months. Will be used to compile a financial worksheet.

Include all that apply to your situation:

Examples:
Automobile loans
Alimony/child support
Child care bills
All credit card bills
Electricity bills
Gas bills
Water/Sewage bills
Home telephone bills
Cell phone bills
Cable bills
Automobile insurance
Health insurance
Life insurance
Doctor bills
Dentist bills
Pharmaceutical drug bills
Food/Groceries
School lunches
Gasoline (auto)
Student loans
Other loans
Other bills

In addition to this you need to write a hardship letter. Here is a blog post on How to write a Hardship Letter.

If you haven’t got your house on the market yet, contact me so that we can do that as soon as possible. You have no time to waste. For questions about the process call me.

CJ Stott
Equity Summit Group
(801) 367-8202
cj@cjsellsutahhomes.com

This is an explanation to help put buyers at ease when looking to make an offer on a home. The comparison is made that Under Contract is much like being engaged to be married.


CJ Stott
Equity Summit Group
(801) 367-8202

This video is to help buyers see beyond the clutter for a gold mine. This is also a reality check for sellers who think that buyers should see beyond the minimal work that needs to be done to sell a home.

2011 is off to a good start with January year-over-year sales outpacing 2010 by 22% (from 259 units to 331).

Condos, which have dropped in sales and in price for nearly 15 straight months saw a rebound; sales rose 53% from only 18 in Jan of 2010 to 38 this year. Condo price’s rose slightly compared to last Jan but are up sharply from last months.

Home prices slipped another 13.5% to a median of $181,500, down from $210,000.

If you want information about a specific city in Utah County make a request in a comment. I’ll be happy to post it for you.

CJ Stott
Equity Summit Group
(801) 367-8202
cj@cjsellsutahhomes.com

1. Investigate local, state, and national down payment assistance programs. These programs give qualified applicants loans or grants to cover all or part of your required down payment. National programs include the Nehemiah program, www.getdownpayment.com, and the American Dream Down Payment Fund from the Department of Housing and Urban Development, www.hud.gov.

2. Explore seller financing. In some cases, sellers may be willing to finance all or part of the purchase price of the home and let you repay them gradually, just as you would do with a mortgage.

3. Consider a shared-appreciation or shared-equity arrangement. Under this arrangement, your family, friends, or even a third-party may buy a portion of the home and share in any appreciation when the home is sold. The owner/occupant usually pays the mortgage, property taxes, and maintenance costs, but all the investors’ names are usually on the mortgage. Companies are available that can help you find such an investor, if your family can’t participate.

4. Ask your family for help. Perhaps a family member will loan you money for the down payment or act as a co-signer for the mortgage. Lenders often like to have a co-signer if you have little credit history.

5. Lease with the option to buy. Renting the home for a year or more will give you the chance to save more toward your down payment. And in many cases, owners will apply some of the rental amount toward the purchase price. You usually have to pay a small, nonrefundable option fee to the owner.

6. Consider a short-term second mortgage. If you can qualify for a short-term second mortgage, this would give you money to make a larger down payment. This may be possible if you’re in good financial standing, with a strong income and little other debt.

CJ Stott
Equity Summit Group
(801) 367-8202
cj@cjsellsutahhomes.com

Spring is approaching and time to rid your home of the clutter. Garage sales can be a great way to do that — and earn a little extra cash Follow these tips for a successful sale.

1. Get a permit. Most municipalities will require you to obtain a special permit or license in order to hold a garage sale. The permits are often free or very inexpensive, but still require you to register with the city.

2. See if neighbors want to join in. You can turn your garage sale into a block-wide event and lure more shoppers if you team up with neighbors. However, a permit may be necessary for each home owner, even if it’s a group event.

3. Schedule the sale. Sales on Saturdays and Sundays will generate the most traffic, especially if the weather cooperates. Start the sale early, 8 a.m. or 9 a.m. is best, and be prepared for early birds.

4. Advertise. Place an ad in free classified papers and Web sites, and in your local newspapers. Include the dates, time, and address. Let the public know if certain types of items will be sold, such as baby clothes, furniture, or weightlifting equipment. On the day of the sale, balloons and signs with prominent arrows will help to grab the attention of passersby.

5. Price your goods. Lay out everything that you plan to sell, and attach prices with removable stickers. Remember, garage sales are supposed to be bargains, so try to be objective as you set prices. Assign simple prices to your goods: 50 cents, 3 for $1, $5, $10, etc.

6. If it’s really junk, don’t sell it. Decide what’s worth selling and what’s not. If it’s really garbage, then throw it away. Broken appliances, for example, should be tossed. (Know where a nearby electrical outlet is, in case a customer wants to make sure something works.)

7. Check for mistakes. Make sure that items you want to keep don’t accidentally end up in the garage sale pile.

8. Create an organized display. Lay out your items by category, and display neatly so customers don’t have to dig through boxes.

9. Stock up on bags and newspapers. People who buy many small items will appreciate a bag to carry their goods. Newspapers are handy for wrapping fragile items.

10. Manage your money. Make a trip to the bank to get ample change for your cashbox. Throughout the sale, keep a close eye on your cash; never leave the cashbox unattended. It’s smart to have one person who manages the money throughout the day, keeping a tally of what was purchased and for how much. Keep a calculator nearby.

Good Luck!

CJ Stott
Equity Summit Group
(801) 367-8202
cj@cjsellsutahhomes.com

Step 1 Brain Storm

Writing a convincing hardship letter is crucial to getting your short sale approved. Do your best writing it and then allow others you trust to proof read it.

Sit down and write every idea that comes to your head that contributes to your needing  a short sale. Maybe it was  divorce or credit card debt, medical bills, employment changes or lack there of, increased property taxes. Just write down every idea that has an effect on your financial situation.

Step 2 Narrow it Down

Look at your list and think of the ones that had the most of effect on your financial situation. Try and narrow it down to at least five by putting your self in the seat of your lender and what would be the most convincing.  For each one of those write a sentence or two about how that factor has played a part.

Step 3 Create Header for the Letter

• Line 1:  Enter the banks name and that you are requesting a short-sale
• Line 2: Add contact info for the bank ie; address, fax, phone etc.
• Line 3: Skip a space
• Line 4: Add current date
• Line 5: RE: Request for short sale and your Loan # and property address.
• Line 6: Skip a space
• Line 7: Dear (Bank’s Name) Representative

Step 4: Write the Body

Rule number #1 is: Do not make the letter longer than one page. The individuals at banks do not want to read your novel. Put the letter in paragraph form and be very succinct with your points.

First paragraph: State a change. Mention what change took place why you can no longer afford your payments. Keep it brief and simply let them know that some change happened between the time you bought the home and now which has affected your ability to pay your mortgage loan.

Second paragraph: State why your area is bad. Ex: “My property is located in ______ town. The taxes have increased, property values have declined, there are 5 foreclosures on my street, etc.” List any bad circumstances for your specific location

3rd and or 4th paragraph: Add the ideas you brainstormed in step one.

Final paragraph: Clearly state that you “cannot pay” and need to short sale the home. You don’t have any other options available. State your intent: do you want to keep your home or not? Leave your contact info or short sale agent’s contact info if they require further information.

Sign, date, and give to your short sale agent, attorney, or bank.

Good Luck and know there is a bright future ahead for you,

CJ Stott
Equity Summit Group
(801) 367-8202
cj@cjsellsutahhomes.com

CAMP WILLIAMS — Today’s groundbreaking for a $1.5 billion National Security Administration data center is being billed as important in the short term for construction jobs and important in the long term for Utah’s reputation as a technology center.

“This will bring 5,000 to 10,000 new jobs during its construction and development phase,” Sen. Orrin Hatch, R-Utah, said on Wednesday. “Once completed, it will support 100 to 200 permanent high-paid employees.”

Read More From Deseret News

This is exciting to see this  development underway. No doubt this employment will help strengthen the economy in Utah County, especially for the west side of the valley for cities like Saratoga Springs, Eagle Mountain and Lehi. The construction of the Pioneer Crossing and the other UDOT projects still underway will help what otherwise been a worse problem.  I am sure those in the decision making of this project en sured that transportation infrastructure was in place or would be by the time they  finish.

While this will be a boon to the economy I have heard expressed concern for the fact that this could become a target for threats and terrorism.

Is that a concern? What do you think?

CJ Stott
Real Estate Consultant
(801) 367-8202

Facing Foreclosure: What to Do Right Now

By: Jerry DeMuth

Published: February 5, 2010

If you’re facing foreclosure, don’t panic: Take steps right now to save your home or at least lessen the blow of its loss.

Foreclosure process takes time

The entire foreclosure process can take anywhere from two to 12 months, depending on how fast your lender acts and where you live. Some states allow a nonjudicial process that’s speedier, while others require time-consuming judicial proceedings.

Once you miss at least one mortgage payment, the steps leading up to an actual foreclosure sale can include demand letters, notices of default, a recorded notice of foreclosure, publication of the debt, and the scheduling of a foreclosure auction. Even when an auction is scheduled, however, it may never occur, or it may occur but a qualified buyer doesn’t materialize.

Bottom line: Foreclosure can be a long slog, which gives you enough time to come up with an alternative. Meantime, if your goal is to salvage your home, think about keeping up with payments for homeowners insurance and property taxes. Otherwise, you could compound your problems by getting hit with an uncovered casualty loss or liability suit, or tax liens.

Read the fine print

Start by reviewing all correspondence you’ve received from your lender. The letters–and phone calls–probably began once you were 30 days past due. Also review your mortgage documents, which should outline what steps your lender can take. For instance, is there a “power of sale” clause that authorizes the sale of your home to pay off a mortgage after you miss payments?

Determine the specific foreclosure laws for your state. What’s the timeline? Do you have “right of redemption,” essentially a grace period in which you can reverse a foreclosure? Are deficiency judgments that hold you responsible for the difference between what your home sells for and your loan’s outstanding balance allowed? Get answers.

Pick up the phone

Don’t give up because you missed a mortgage payment or two and received a notice of default. Foreclosure isn’t a foregone conclusion, but it’s heading in that direction if you don’t call your lender. Dial the number on your mortgage statement, and ask for the Loss Mitigation Department. You might stay on hold for a while, but don’t hang up. Once you do get someone on the line, take notes and record names.

The next call should be to a foreclosure avoidance counselor approved by the U.S. Department of Housing and Urban Development. One of these counselors can, free of charge, explain your state’s foreclosure laws, discuss alternatives to foreclosure, help you organize financial documents, and even represent you in negotiations with your lender. Be wary of unsolicited offers of help, since foreclosure rescue scams are common.

Be sure to let your lender know that you’re working with a counselor. Not only does it demonstrate your resolve, but according to NeighborWorks, homeowners who receive foreclosure counseling are 1.6 times more likely to avoid losing their homes than those who don’t. Homeowners who receive loan modifications with the help of a counselor also reduce monthly mortgage payments by $454 more than homeowners who receive a modification without the aid of a counselor.

Lender alternatives to foreclosure

Hope Now, an alliance of mortgage companies and housing counselors, can aid homeowners facing foreclosure. A self-assessment tool will give you an idea whether you might be eligible for help from your lender, and there are direct links to HUD-approved counseling agencies and lenders’ foreclosure-prevention programs.

There are alternatives to foreclosure that your lender might accept. The most attractive option that’ll allow you to keep your home is a loan modification that reduces your monthly payment. A modification can entail lowering the interest rate, changing a loan from an adjustable rate to a fixed rate, extending the term of a loan, or eliminating past-due balances. Another option, forbearance, can temporarily suspend payments, though the amount will likely be tacked on to the end of the loan.

If you’re unable to make even reduced payments, and assuming a conventional sale isn’t possible, then it may be best to turn your home over to your lender before a foreclosure is completed. A completed foreclosure can decimate a credit score, which will make it hard not only to purchase another home someday, but also to rent a home in the immediate future.

Your lender can approve a short sale, in which the proceeds are less than what’s still owed on your mortgage. A deed-in-lieu of foreclosure, which amounts to handing over your keys to your lender, is another possibility. The earlier you begin talks with your lender, the more likelihood of success.

Explore government programs

The federal government’s Making Home Affordable program offers two options: loan modification and refinancing. A self-assessment will indicate which option might be right for you, but you need to apply for the program through your lender. A Making Home Affordable loan modification requires a three-month trial period before it can become permanent.

Fannie Mae and Freddie Mac have their own foreclosure-prevention programs as well. Check to determine if either Fannie or Freddie owns your mortgage. Present this information to your lender and your counselor. Fannie and Freddie also have rental programs under which former owners can remain in recently foreclosed homes on a month-to-month basis.

The federal Home Affordable Foreclosure Alternatives program, which takes full effect in April 2010, offers lenders financial incentives to approve short sales and deeds-in-lieu of foreclosure. It also provides $3,000 in relocation assistance to borrowers. Again, talk to your lender and counselor.

Jerry DeMuth has written about mortgages and other financial issues for more than two decades for trade publications, major newspapers, and consumer magazines. His writing has received four awards and has been included in eight non-fiction books.

If you finally resolve to do a Short Sale here is a blog on the Short Sale Check List

CJ Stott
Equity Summit Group
(801) 367-8202

5 Tips for Buying a Foreclosure

By: G. M. Filisko

Published: March 29, 2010

Get prequalified for a loan and set aside funds, and you’ll be ready to purchase a foreclosed home.

1. Choose a foreclosure sale expert. Lenders rarely sell their own foreclosures directly to consumers. They list them with real estate brokers. You can work with a real estate agent who sells foreclosed homes for lenders, or have a buyer’s agent find foreclosure properties for you. To locate a foreclosure sales specialist, call local brokers and ask if they are the listing agent for any banks.

Either way, ask the real estate professional which lenders’ homes they’ve sold, how many buyers they’ve represented in a foreclosed property purchase, how many of those sales they closed last year, and who they legally represent.

If the agent represents the lender, don’t reveal anything to her that you don’t want the lender to know, like whether you’re willing to spend more than you offer for a house.

2. Be ready for complications. In some states, the former owner of a foreclosed home can challenge the foreclosure in court, even after you’ve closed the sale. Ask your agent to recommend a real estate attorney who has negotiated with lenders selling foreclosed homes and has defended legal challenges to foreclosures.

Have your attorney explain your state’s foreclosure process and your risks in purchasing a foreclosed home. Set aside as much as $5,000 to cover potential legal fees.

3. Work with your agent to set a price. Ask your real estate agent to show you closed sales of comparable homes, which you can use to set your price. Start with an amount well under market value because the lender may be in a hurry to get rid of the home.

4. Get your financing in order. Many mortgage market players, such as Fannie Mae, require buyers to submit financing preapproval letters with a purchase offer. They’ll also reject all contingencies. Since most foreclosed homes are vacant, closings can be quick. Make sure you have the cash you’ll need to close your purchase.

5. Expect an as-is sale. Most homeowners stopped maintaining their home long before they could no longer make mortgage payments. Be sure to have enough money left after the sale to make at least minor, and sometimes substantive, repairs.

Although lenders may do minor cosmetic repairs to make foreclosed homes more marketable, they won’t give you credits for repair costs (or make additional repairs) because they’ve already factored the property’s condition into their asking price.

Lenders will also require that you purchase the home “as is,” which means in its current condition. Protect yourself by ordering a home inspection to uncover the true condition of the property, getting a pest inspection, and purchasing a home warranty.

Be sure you also do all the environmental testing that’s common to your region to find hazards such as radon, mold, lead-based paint, or underground storage tanks.

G.M. Filisko is an attorney and award-winning writer who purchased a foreclosed condominium and found herself in the middle of a months-long dispute between the former homeowner and the bank over whether the foreclosure was conducted properly. Six months after paying the full purchase price, she was finally able to enter the property. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

 

CJ Stott
Real Estate Consultant
(801) 367-8202