Orlando Real Estate Voice

1. The bank is going to what to see your entire financial picture. This means you will need to provide copy of back taxes, paycheck stubs, bank statements, personal financial statement, etc. They will want to know what all your assets are.
2. The bank may want you to sign a promissory note for the difference, now it will most probably be at a hugely reduced amount and may include monthly payments.
3. When the bank gives the final approval of the short sale, they may request that the escrow close in as little as 30 days, sometimes sooner.
4. As the seller, you can not receive any proceeds from the sale. Period.
5. Your Real Estate agents, and Title company, may have to work for reduced fees.
6. The banks are incredibly overwhelmed with short sales and many times a decision can take upwards of 90 days; however, recently the approval process has been streamlined at many lenders.
7. Your property may be foreclosed on during the short sale process because the bank can not process the short sale in time; however, if you have a strong agent they should be able to get the foreclosure postponed give me a call to help postpone any foreclosure dates.
8. Do not expect to receive any information on a regular basis. There may be weeks that go by with no news from the lender. This is perfectly normal.
9. The bank will want to get a BPO (broker price opinion) and/or an appraisal of your house.
10. Be patient. This is the best policy. Try to avoid being stressed out over something that you can not control. If you have a well trained agent, you are in good hands.

If you have any questions, please don’t hesitate to contact me.

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Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of Real Estate in Orlando, Windermere, Winter Garden Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area. Please visit www.JerrySellsOrlando.com for your real estate needs. Please give me a call if you have questions about the Orlando and Central Florida real estate market.

P.S. If you are listing your home as a short sale in Orange County Florida and Orlando, Windermere, Winter Garden, or Ocoee Florida make sure you hire an agent who knows how to do short sales and has the experience to get the job done. We are doing successful short sale packages. Call us at 407-580-7011 to find out more about Orange County Short Sales and Orlando Area Short Sales.

With more than 4 million homeowners behind on their mortgage payments, the government and major banks are scrambling to help at-risk borrowers avoid foreclosure. Is there Help here in Orlando, FL.

What exactly have they done – and can they do more?

For one thing, the government and the mortgage industry said Tuesday a new plan will allow lenders to alter delinquent loans more quickly. That follows Citigroup’s announcement late Monday that it would expand its efforts to help its beleaguered borrowers. Other national banks have initiated similar programs.

But what else is on the table?

Here are some questions and answers about mortgage assistance:

Q: What is a foreclosure moratorium?

A: A foreclosure moratorium is when a lender holds off on starting a foreclosure or completing a foreclosure sale on a delinquent borrower, to give both parties time to rework the loan or set up a repayment plan.

Oftentimes, the lender sets conditions for a moratorium. They might require, for example, that the home be the borrower’s primary residence and that the borrower have enough income to make affordable mortgage payments.

Q: What is a repayment plan?

A: When a lender works out a plan for a borrower to pay back missed payments, it’s called a repayment plan, or forbearance. A lender can increase the monthly payment until the missed payments are paid off or add the missed payments to the total principal the borrower owes.

Q: Can a restructured mortgage include an interest rate reduction?

A: Yes – to lower monthly payments, a lender might decrease the mortgage interest rate either permanently or temporarily.

Q: What is a principal reduction?

A: A principal reduction, or forgiveness, lowers the total principal amount the borrower owes on the mortgage. That, in turn, decreases the monthly payment.

Q: How can changing the length of the loan help a struggling borrower?

A: To lower payments without changing the interest rate, a lender can extend the time required to pay off the loan. For example, a lender might restructure a 30-year mortgage as a 40-year loan, shrinking the payments by stretching them over an extra 10 years.

Q: What is a short sale?

A: A short sale is when a lender allows a borrower to sell the home for less than what’s owed on the mortgage, and accepts that amount as enough to satisfy the debt. For a borrower, a short sale is less detrimental on a credit report than a foreclosure, but it’s still a hefty stain.

Q: What other methods could lenders be using to help at-risk borrowers?

A: Lenders and the government are using all the tools available to them to help struggling borrowers. However, many of the most far-reaching remedies weren’t made available until it was too late for many homeowners. And the continued rapid decline in housing prices, the stalled credit markets and the weakening economy have only made matters worse for troubled borrowers.

Q: Why is it hard to rework a loan?

A: In the late 1980s, Wall Street started to slice up mortgages and repackage them into securities that were sold to investors. As a result, many different investors could end up owning pieces of the same mortgage.

Now many of these investors are reluctant to allow significant modifications of the loans they partly own – like reducing the principal balance – because they don’t want to take a huge investment loss.

Deutsche Bank estimates more than 80 percent of the $1.8 trillion in outstanding troubled loans have been packaged into these sorts of investments.

Q: Who else can help borrowers?

A: Borrowers are encouraged to contact their lenders or mortgage servicers as soon as they think they may fall behind on a payment. The sooner contact is made, the easier it is to head off larger problems.

Homeowners can also contact a nonprofit housing or credit counseling service to help with lender negotiations. Reputable services can be found, state-by-state, on the Department of Housing and Urban Development’s Web site, and the Homeownership Preservation Foundation has a 24/7 toll-free hot line: 888-995-HOPE (4673).

If your Lender as most will say “contact a Realtor in your area that specializes in Short Sales and sell your home” Then I’m the one to contact. I have experience in Short Sales and that is over 90% of my business right now. I can Help. Call Me.

About the author:

Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of real estate in Orlando, Windermere, Winter Garden Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area. Please visit www.JerrySellsOrlando.com for your real estate needs. Please give me a call if you have questions about the Orlando and Central Florida real estate market.

Jerry LaRose, P.A., ABR, GRI, e-PRO, CLHMS, REALTOR® 407-580-7011

(Copyright © 2008 By Jerry LaRose, P.A. All Rights Reserved.)

Borrowers Name: _________________________ DOB _________

Borrower #2: ____________________________________

Social Security Number: B#1: ____________ B#2: ____________

Loan Number: _____________________________________

Lender Name: ________________________________________

Lender Phone: _______________________________________

Loan #2 Number: __________________________________________

Lender #2 Name: ____________________________________

Lender #2 Phone: _________________________________________

Subject Property Address: ____________________________

___________________________________________

Borrower Mailing Add: _____________________________

Borrower Phone Associated with Loan: __________________________Lender #1 Short Sale Package List: __________________________

__ Lender #2 Short Sale Package List: _______________________

__ 1. Most recent mortgage statement or coupon

__ 2. Copy of any letters you have received from your lender regarding delinquency

__ 3. Current proof of income (two recent pay stubs from each person on the mortgage)

__ 4. Two most recent tax returns (1040 Form, only first two pages)

__ 5. Two most recent bank statements (all accounts: checking, savings, etc.)

__ 6. Freddie Mac Borrower Financial Information form or one provided by your lender.

__ 7. Handwritten Hardship Letter

__ 8. Listing Agreement

__ 9. Signed Sales Contract

__ 10. Estimated HUD -1

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Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of Real Estate in Orlando, Windermere, Winter Garden Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area. Please visit www.JerrySellsOrlando.com for your real estate needs.  Please give me a call if you have questions about the Orlando and Central Florida real estate market.

P.S. If you are listing your home as a short sale in Orange County Florida and Orlando, Windermere, Winter Garden,  or Ocoee Florida make sure you hire an agent who knows how to do short sales and has the experience to get the job done. We are doing successful short sale packages. Call us at 407-580-7011 to find out more about Orange County Short Sales and Orlando Area Short Sales

Documentation In File:

Below is a Short Sale Info. Sheet that may be helpful in regards to preparing for your short sale.

SHORT SALE INFO SHEET

1. First and foremost I would always recommend anyone considering a short sale in the Orlando area to talk to your tax advisor first.

2. I posted in my FAQ’s on short sales the following:

Is the seller going to get hit with a tax bill or a 1099 if you do a short sale?

Upon successfully closing a short sale, lenders will always report a loss to the IRS and issue a 1099. However, the Mortgage Forgiveness Act of 2007 was signed into law on 12-20-07 and is now official, effectively getting rid of the question “will I be taxed on the Short Sale”. Prior to this action, forgiven mortgage debt due to foreclosure, short sale, or deed in lieu of foreclosure, was potentially taxable income to the borrower.

This was the subject of much media attention and led to many questions and concerns from Sellers wondering whether or not they were going to get “hit with taxes” on the Short Sale.
The new law, however, temporarily waives these taxes for debts forgiven (as high as 35%) from the beginning of 2007 to the end of 2009.
This will effectively put an end to the question from Sellers… will I be taxed on the Short Sale discount. The definitive answer (at least until the end of 2009) is NO!

For a copy of the Mortgage Forgiveness Debt Relief Act of 2007, go to:
http://www.govtrack.us/congress/bill.xpd?bill=h110-3648 or http://www.whitehouse.gov/news/releases/2007/12/20071220-6.html

However, I would like to amend that statement and say talk to your tax advisor or attorney, I recently met with an attorney and got a clarification on this law. It was his understanding that this rule only applies to homeowners that occupy the residence and this is and has been their principal residence for the last 2 out of 5 years. YES, your principle residence and you must have lived in for the last 2 years.

I also understand that if you took a Heloc loan or an equity loan and it was not used on and for the home you also may get taxed on this amount even if it’s your primary residence. In other word if you took out a Heloc loan for $50,000 and spent it on a boat. Sorry, you have to pay the tax consequence on this amount if the bank eliminates this debt.

The bottom line here is that only Acquisition funding can be forgiven by the Mortgage Forgiveness Debt Relief Act of 2007.

3. Foreclosure, Deed in Lieu and Short Sales are all treated the same in regards to taxes.

Summary: Any cancellation of debt is a taxable event except for any acquisition funding for your primary residence that you’ve lived in for the last 2 years. Everything else is taxable.

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Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of Real Estate in Orlando, Windermere, Winter Garden Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area. Please visit www.JerrySellsOrlando.com for your real estate needs. Please give me a call if you have questions about the Orlando and Central Florida real estate market.

P.S. If you are listing your home as ashort sale in Orange County Florida and Orlando, Windermere, Winter Garden, or Ocoee Florida make sure you hire an agent who knows how to do short sales and has the experience to get the job done. We are doing successful short sale packages. Call us at 407-580-7011 to find out more about Orange County Short Sales and Orlando Area Short Sales.