Short Sale application process is very similar to the loan origination process when you received your loan from a bank. This package must be prepared for a bank to consider approving your request to sell your home short.

• Financial Information:
• Tax information --two most recent 1040's and 2 most recent W2's
• 60 days of current bank statements-(this is ongoing until the approval)
• 30 days of current pay stubs or commission check stubs.
• If self employed- pay stubs or YTD profit and loss statements
• Monthly budget/financial statement signed and dated

Hardship Information

• Hardship letter dated and signed same day as purchase contract
• Any documention supporting the actual hardship
• Medical Bills
• Child support or alimony payment information and divorce decree or child support order.

Mortgage & Other Relevant Property Information

• First Mortgage Statement
• 2nd mortgage statement if required (home equity loans?)
• Recent Real Estate Tax bills
• Recent condo association bills if applicable
• Any recent water, sewer bills, electricity, gas bills.

Other Documention

• Authorization form for lawyer and Realtor
• Short sale disclosure
• Waiver of conflict if representing the buyer
• 3 recent comps
• Listing agreement
• Offer to purchase agreeement
• Listing history
• Buyer proof of funds letter or Pre approval letter. 

It is important to understand that the above documents are required for almost every short selling bank. There are also bank specific forms that, in most cases, must accompany the above.

The end result if packaged correctly will be a happy buyer, seller and bank negotiator. By preparing yourself for the financial details you will make this horrendous task an easier one.

1. Zillow reported that 47% of all buyers think that the average appreciation in real estate is 7% a year.....

      j-whoa there! Real estate appreciation in normal times was 3-5% in the   Chicagoland area.

2. Zillow reported a misconception about mortgage insurance.

       j-Mortgage insurance is paid by a buyer who has less than 20% down to protect the Bank. There is no value to the buyer at all ==> it's a risk to the Bank to protect their portion of their money.

3. Zillow reported that 56% thought appraisers for the Bank acted as a HOME INSPECTOR.

        j- An appraiser is there to justify the price paid in the market for a house. The Bank is protecting their interest in your choice of housing.

         A Home inspector is there to tell you the up and down side of used housing. Every home has a problem, and it behooves the buyer to have a crystal clear view of potential problems with any home.

4. 37% of all buyers thought that Homeowner's Insurance was an optional insurance.

         J-All Banks require Homeowner's Insurance, and if you fail to pay your premium, the note allows the Bank to charge you for the insurance they pick.

5. Zillow reported that many people believed the signed offer to purchase means they own the home.

          J-Not until the Bank has commited the funds, the deed has been transferred in your name, does a buyer own the home.

Let me clear up your questions on Home Purchases! Call me anytime.

• Home price declines: not only are millions of homes available to investors at deeply discounted pricing but the low prices are changing consumer attitudes on housing as an investment
• Hurdles to buying: down payment requirements, higher FICO score thresholds, and income verification are making it harder for households to even consider buying
• Costs of ownership: without home price inflation, costs like property taxes, home owner association dues, maintenance and repair make ownership less attractive
• Demographic effects: Gen Y growth is heading up while baby boomer households are downsizing
• Unemployment, labor insecurity and mobility: long unemployment durations make labor mobility (and thus renting) more important

Morgan Stanley says the U.S. home ownership rate, which has fallen to about 64 percent from close to 68 percent at its peak, is really closer to 60 percent when you factor in home owners who’ve stopped paying on their mortgage and only remain in their house because the bank hasn’t finished processing their foreclosure yet. Once these cases make it through the system, they’ll move to the renter side of the equation.

So how I see it is if you can get a mortgage, or you have savings, some of the distressed properties are such a bargain, (of course, you'll do some rehab), your return on an investment is increasing. It was interesting to me that 4 out of 10 people prefer to rent rather than purchase at this time.

j

• Home price declines: not only are millions of homes available to investors at deeply discounted pricing but the low prices are changing consumer attitudes on housing as an investment
• Hurdles to buying: down payment requirements, higher FICO score thresholds, and income verification are making it harder for households to even consider buying
• Costs of ownership: without home price inflation, costs like property taxes, home owner association dues, maintenance and repair make ownership less attractive
• Demographic effects: Gen Y growth is heading up while baby boomer households are downsizing
• Unemployment, labor insecurity and mobility: long unemployment durations make labor mobility (and thus renting) more important

Morgan Stanley says the U.S. home ownership rate, which has fallen to about 64 percent from close to 68 percent at its peak, is really closer to 60 percent when you factor in home owners who’ve stopped paying on their mortgage and only remain in their house because the bank hasn’t finished processing their foreclosure yet. Once these cases make it through the system, they’ll move to the renter side of the equation.

So how I see it is if you can get a mortgage, or you have savings, some of the distressed properties are such a bargain, (of course, you'll do some rehab), your return on an investment is increasing. It was interesting to me that 4 out of 10 people prefer to rent rather than purchase at this time.

j

Mortgage Bottlenecks Hold up Closings

Written by: editor Mon, October 24, 2011

Beyond Today's News, Crisis Watch, Housing Crisis

Print

Radon- A Health and Safety Issue for your Family

Radon gas can be a worry for homeowners. This naturally occurring substance has been found in homes throughout the Illinois and the country. 47% of the entire state of Illinois has this problem, and interesting enough the house next door may be under the 4.0 psi measure and you maybe way above.

It is odorless, colorless and undetectable without sophisticated testing. Radon is a health and safety issue in home inspections, and  has been linked to many diseases, and environmental experts caution that it should be tested. Remember that if radon gas is detected, it can usually be removed at a relatively low cost with simple ventilation systems.

Concerned about radon in your home? You can have it tested. You can contact your the Environmental Protection Agency for information about how to find a reputable company qualified to perform the tests or you can call me, since I have had to do the research for some of my sales and listings. If you are buying a new home, you might consider including a radon test as part of the inspection contingency clause. And if you are planning to sell your home, you can test it for radon before placing it on the market. If there is no problem, your fears will be put to rest, and even if radon is detected, it is neither difficult nor costly to correct.

Walk to train, library and shops in Proud Des Plaines In Town area!

This 2 bedroom, 2 bath condo with garage is Value Priced in the market at 109000. The advantages of this great location are many with a walk score clearly in the 90's. The home has been well maintained by the original owner with newer windows, newer furnace and central air conditioning.

Enjoy the south exposure balcony in this all brick elevator building with laundry on the same floor. This neighborly building is all owner occupied. Get more information and tour in the link below:

http://www.janmcnulty.com/property/1436-THACKER-ST-409-DES-PLAINES-Illinois-2

Illinois housing market forecast for the second half of 2011

by Mary Schaefer on August 18, 2011

Illinois housing market forecast for the second half of 2011

by Mary Schaefer on August 18, 2011

Attention! New Service!

I just signed up for a SmartPhone Website with Quinn McNulty and I'm excited on all the new marketing I can do for my sellers.

I'll be linking all of the QR codes to the properties so Smart Buyers and get a hold of me to show them homes. Awesome stream of over 80,000 new ways to reach buyers.

Quinn can tell you all about it...at quinnmcnulty@yahoo.com--he'll explain this new marketing tool or visit http://pgp.mviso.com for an example.

I am sooooo excited!!

Today our MLS service allows the agent to list the property where buyers have connections to other agents. (No longer the big books to float through). The exposure is a more powerful tool in marketing than previous older mls systems. The buyer is alerted to the listing by email of homes that fits their criteria at the same time as their buyer's agent. There are opportunities for the listing agent to have 15 pictures, attach a video or virtual tour to show off the house. Pertinent information is included in the listing, ie the location, size, number of rooms, style of home and the personal property that comes with the price of the home. Other key information are the schools serviced in the area, what kind of terms are acceptable to the seller and the housing.

A good Realtor is a real estate matchmaker, trying to find the features that best fit their buyer as well as the seller. Today, we sit at a tough market. The pricing of the home has to be competitive to other listings not only for the buyers but for the appraisers to see the value. The house has to shine above the crowd, so condition, pricing and size determine the price, but the buyer will be the one to confirm the value.

Built by Centex Homes in 1985 and 1987, 29 building of attached home residences were offered to the public as a Contemporary Coach home. 8 different floor plans, three were 2nd floor units with coffered and cathedral ceilings. The horse shoe shaped streets over views of the forest perserve, golf course and a central park.

Tucked in between Meacham & Plum Grove Road, south of Schaumburg Rd & Nerge, these coach homes had large windows and bays to expand the view in square footage. Homes range from 916 square feet which offer 2 bedrooms and 1 bath to 1519 square feel having 2-3 bedrooms and 2 baths. Each unit has its own individual garage. Close to Fox Run Golf Links run by the Elk Grove Village Park district which offers a restaurant, casual dining and a beautiful course. Close to 53/355 east on Schaumburg rd to the Higgens entrance which can lead to 90 express to Chicago or the airport.

Centex dealt with details in upgrades: Oak railings, 6 panel vinyl doors, wood doors, lighting enhancements, and unique entry ways. Each of the Fox Run Manor Homes have 2 staired entry with Paladiam windows to light up the common entry. No feeling of boxiness with these coach homes offering bay windows in eating areas, dens or bedrooms. These are upscale starter homes but the demographics suggest that the downsizing senior feels right at home, as well as the empty nester. Divorcee's with children appreciate the Enders-Salk Dist 54 schools as well as the very popular District 211 James Conant High School.

Since these past beginnings, the updating for todays' style can surely be seen. In 2011, Alma Properties has been managing these facilites. Association fees include garbage, water, snow removal, landscaping and common insurance. Unique to this association is the window are covered by the association.

FHA and VA loans have mortgage insurance between the 3.5% down to the 20% limit. If you have 20% down, you are not required to have this insurance.

This is the important part:

“After careful consideration and analysis, we determined it was necessary to increase the annual mortgage insurance premium at this time in order to bolster the FHA’s capital reserves and help private capital return to the housing market,” said Stevens. “This quarter point increase in the annual MIP is a responsible step towards meeting the Congressionally mandated two percent reserve threshold, while allowing FHA to remain the most cost effective mortgage insurance option for borrowers with lower incomes and lower down payments.”

The proposed change was announced last week as part of the Obama Administration’s report to Congress, which outlined the Administration’s plan to reform the nation’s housing finance system. The Administration’s housing finance plan also recommended that Congress allow the present increase in FHA conforming loan limits to expire as scheduled on Oct. 1, 2011.

This premium change enables FHA to increase revenues at a time that is critical to the ongoing stability of its Mutual Mortgage Insurance (MMI) fund, which had capital reserves of approximately $3.6 billion at the end of FY 2010. The change is estimated to contribute nearly $3 billion annually to the Fund, based on current volume projections. It is vital that HUD take action to ensure that FHA will continue to serve its dual mission of providing affordable homeownership options to underserved American families and first-time homebuyers while helping to stabilize the housing market during these tough times.

On average, new FHA borrowers will pay approximately $30 more per month. This marginal increase is affordable for almost all homebuyers who would qualify for a new loan. Existing and HECM loans insured by FHA are not impacted by the pricing change.

Between the interest rate increase as well as the mortgage insurance increase, the new housing buyer will find how much they can afford will lessen. Prices are stabilizing, the decline has slowed down so now is the time to take advantage of the lowest prices since 2000.

Buyers need the help to analyze values of homes and costs and how it will impace their budget. The path has been rough these past few years. Let my 22 years of experiance help you to find the solution. Jan McNulty, RE/MAX SUBURBAN, Your Real Estate Counselor and Friend, 847-274-0535.

                 Appraisals Increasingly Becoming 'Deal Killers'

Appraisals are increasingly being blamed for preventing deals from making it to the closing table. In a common scenario playing out across the country, sellers are accepting buyer offers to later have an appraisal come in at a dramatically lower amount, which threatens to derail the entire deal. Unless the seller comes down in price or the buyer puts down more money, the deal often fizzles.

"The appraisers have so much power to kill deals," Jennifer Snyder, president of the St. Paul Area Association of REALTORS® in Minnesota, told the Pioneer Press.

Appraisers determine a property value by evaluating over the past six months sold transactions, current listings, and pending sales. But some critics argue that appraisers are giving too much weight to foreclosed properties in their comparables. While appraisers once rarely factored in short sales and foreclosures, appraisers would be negligent not to do so now, said Paul Sellwood, owner of Real Estate Appraisal Services in White Bear Lake.

"We're not playing God and saying what is your property worth," says Neal Harrah, owner of Regional Appraisals Inc. in Lakeville, Minn. "We're offering an opinion based on current data out there."

Real estate pros are educating sellers more about the appraisal process, realizing that sellers will need to consider the appraisal process more than they ever have and how it can threaten the sale. For example, one of Snyder’s clients had an appraisal come in $10,000 under the buyer’s accepted offer. To save the deal, the seller agreed to drop the home’s price to offset the difference.

In another incident, a buyer offered $110,000 for a condo in St. Paul, Minn., which was then appraised at $65,000. That deal was able to survive, thanks to a buyer who had deep pockets and was willing to put up more money, but the agent says with a normal buyer, it would have never gone through.

Source: “Appraisals: The New Deal Breaker in Real Estate,” Pioneer Press (Jan. 24, 2011)

                 Appraisals Increasingly Becoming 'Deal Killers'

Appraisals are increasingly being blamed for preventing deals from making it to the closing table. In a common scenario playing out across the country, sellers are accepting buyer offers to later have an appraisal come in at a dramatically lower amount, which threatens to derail the entire deal. Unless the seller comes down in price or the buyer puts down more money, the deal often fizzles.

"The appraisers have so much power to kill deals," Jennifer Snyder, president of the St. Paul Area Association of REALTORS® in Minnesota, told the Pioneer Press.

Appraisers determine a property value by evaluating over the past six months sold transactions, current listings, and pending sales. But some critics argue that appraisers are giving too much weight to foreclosed properties in their comparables. While appraisers once rarely factored in short sales and foreclosures, appraisers would be negligent not to do so now, said Paul Sellwood, owner of Real Estate Appraisal Services in White Bear Lake.

"We're not playing God and saying what is your property worth," says Neal Harrah, owner of Regional Appraisals Inc. in Lakeville, Minn. "We're offering an opinion based on current data out there."

Real estate pros are educating sellers more about the appraisal process, realizing that sellers will need to consider the appraisal process more than they ever have and how it can threaten the sale. For example, one of Snyder’s clients had an appraisal come in $10,000 under the buyer’s accepted offer. To save the deal, the seller agreed to drop the home’s price to offset the difference.

In another incident, a buyer offered $110,000 for a condo in St. Paul, Minn., which was then appraised at $65,000. That deal was able to survive, thanks to a buyer who had deep pockets and was willing to put up more money, but the agent says with a normal buyer, it would have never gone through.

Source: “Appraisals: The New Deal Breaker in Real Estate,” Pioneer Press (Jan. 24, 2011)

Catch the Wave!

Market Spotlight! 2011 offers a Golden Opportunity, but for a Golden Opportunity to be had the public needs to have the positive message about the market.

•  Fact: The average fixed rate 30-year average interest rate is 9.0%.

Current rates are at about 5%. The historically low rates make it possible for more people to purchase a home or to even refinance a mortgage. FHA has a new program for lower credit scores (500’s scores) which entails 10% of the borrowers own funds, but happy news a loan could be had.

•  Houses are on Sale and to some it’s like a “blue light special”.

Because of the downturn in the economy, Buyers throughout Illinois are finding values at 2000 price levels or even lower.  Typically, a Short Sale or distressed sales have had their prices reduced by an average of 20%. Foreclosures nationally are sold for less than similar homes by 26%.

•  Indicators Hint at Better Days Ahead.

Per Harvard University, The State of the Nation’s Housing 2010, only 357000 new households were created in 2010-which is down more than 70% from the average in 2002-2007. This 63 year low resulted from lower immigration rates, and many Americans moved in with family members or doubled up with friends when we had a greater economic instability. New household formations are expected to return to more normal levels as the recovery continues.

•  Sudden Stop for Housing Starts

In response to economic weakness, tighter credit and higher resale inventory, builders slammed on the brake. Housing starts per the US Census Bureau have dropped below 1 million units on 3 times since World War II, in 2008, 2009 and 2010.

 Indicators are hinting of Better Days Ahead-