National Closing Center

Archive for the ‘foreclosure’ Category

Listing short sales is a hard work. And I’m not even talking about short sale processing. Many homeowners are scared and confused, they have been taken advantage of by various scammers and too-good-to-be-truth mortgage help plans. It’s not surprising that quite a few homeowners won’t even allow you to help them, although you, as a real estate professional, know perfectly well that their situation can be improved greatly.

So, every time I stumble upon something that could be used as a proof and motivational information in your sales pitch, a share it with NCC members.

I think this New York Times article is worth sharing. Have an appointment with a prospect? They don’t seem convinced that foreclosure is way worse than a short sale?

Let them know that foreclosure is way more than a dent in their credit history.

• Of 250 people undergoing foreclosure in the Philadelphia area, 32 percent reported missing doctor’s appointments.
• 48 percent said they let prescriptions go unfilled.
• People living in high-foreclosure areas are significantly more likely than those in less hard-hit neighborhoods to be hospitalized for diabetes, high blood pressure and heart failure.
• 37 percent mortgage counselors said they had worked with at least one homeowner in the past month who was considering suicide.

The woman in Sarasota, FL, thought she’s being scammed… and then she felt like she won in a lottery. We haven’t encountered anything this big lately, but the tendency on the part of banks to be more generous and act fast(er) is definitely there.

Read the story below.

The bank spent the last two years denying Deborah Johnson’s efforts to save her Sarasota home from foreclosure, and then out of nowhere, last month, sent her an unbelievable offer.

If Johnson can find someone to buy the property for half of what is owed on the mortgage, JP Morgan Chase bank will not only forgive the remaining $100,000 or so of debt, but also send her away with $35,000 in her pocket.

The proposal was far better than a foreclosure, which would punish her credit score more severely, strand her without money for a new place to live, and expose her to collection efforts for the unpaid balance for the rest of her life.

Read more

National Closing Center was mostly business-to-business type of company. We used to provide short sale processing platform and negotiations services to real estate agents and brokers at no cost. Ultimately, homeowners were the ones who benefited from our services, but we used to work with them indirectly, through real estate agents. Now this is about to change.

NCC will continue to work with agents and provide them with top-notch short sale processing services. This is our primary focus. However, on top of this, we are beginning to work directly with distressed home owners, offering them the power of our network, experience and expertise of our members. Needless to say, all our services will remain free of charge for homeowners, as well as Realtors.

Just last week we have launched a targeted website www.chicagoforeclosuresquad.com with the intention to reach home owners who might be considering a short sale in Chicago and its suburbs, from Downers Grove to Highland Park, from Homewood to Berwyn and Cicero, from Wheaton to Orland Park and beyond. In addition, we have made our own website more homeowner friendly buy adding a page dedicated to homeowners: http://www.processingshortsale.com/homeowners/Both the website and the web page have plenty of information on short sales, why is it important to avoid foreclosure, how to rebuild your credit, etc.

This is also a great opportunity for real estate agents and a serious incentive to join our network. With every new homeowner looking to execute a short sale we will need a listing agent and a buyer with the buying agent. Rest assured we will turn to our members FIRST.

As always, we’re grateful for your support! Please check NCC out, refer us to your fellow agents and homeowners that could use our network for a fresh start.

This is the strategy of most banks when it comes to handling a flood of properties that once were occupied by delinquent homeowners. Real estate agents from all over the country have been saying that this is a disastrous strategy.

“My biggest fear right now is that the supply has been artificially restricted,” said Jayson Meyerovitz, a local broker. “They can’t just sit there forever. If so many houses hit the market, what is going to happen then?”

This broker was recently quoted in The New York Times. His thoughts reflect the way most brokers feel about the situation.

All told, banks own more than 872,000 homes as a result of the groundswell in foreclosures, almost twice as many as when the financial crisis began in 2007, according to RealtyTrac, a real estate data provider. In addition, they are in the process of foreclosing on an additional one million homes and are poised to take possession of several million more in the years ahead.

According to global ratings agency Fitch Inc. and other industry experts, 2011 will bring more short sales and fewer foreclosures. It’s an encouraging sign for homeowners, as well as for lenders.

A short sale, or a sale in which a property is sold for less than what is owed on the mortgage, can be an effective alternative to foreclosure while allowing homeowners to escape the burden of bankruptcy.

Slow and cautious to begin with,  many banks were skeptical about short sales, and then when they finally were ready to go, they were terribly understaffed and unprepared to handle the avalanche of requests.

By this time, however, most of the lenders have realized that short sale is the best way to transfer homes from people who cannot afford them any more, to those who have more means and are hunting for bargains.

National Closing Center (NCC) has always advocated for a short sale as the best alternative to foreclosure.

CNN once again has published its foreclosure map. As expected, foreclosures are distributed unevenly across the states. Florida and Nevada are at the top of the list with most foreclosures; 13.68% and 9.72% respectively. California, Illinois, Michigan, New York and New Jersey also have hight rates of foreclosure. Texas, the state that weathered the economic crisis very well, has one of the lowest rate of foreclosures.

You can see the interactive map here >>>>

Could such hight rates be avoided? It’s a billion dollar question. Probably not in places like Nevada. However, not utilizing all tools, including short sale, to the fullest extent definitely not helping to solve the crisis. Although in many cases situations when homeowners find themselves underwater could have hardly been prevented, the impact on individual homeowners and their communities could be mitigated. How? Mostly by educating not only real estate agents, but also homeowners on the benefits of short sales and explaining to them the process so they could enter the contract knowing exactly what to expect.

MSNBC ran a lead story this morning, titled “More people see walking on mortgage as a viable plan.”

According to the article, nearly half f homeowners with a mortgage said they would consider walking away from their home if they owed more on it than it was worth, according to a Harris Interactive survey released this month.

Just six months ago, a similar survey indicated that only 41 percent of consumers would consider walking if they were underwater on their mortgages.

The article quotes a woman named Chris Kelly, who made a decision to leave her house in the suburbs of Seattle after divorce.

According to Ms. Kelly, she faced a tough decision: Leave the house while she still had decent savings, or pay until she’d emptied out all her accounts and then enter foreclosure.

And this is where we have to disagree. The decision is rarely like that.

The woman could have easily stopped paying her mortgage and started negotiating with her lender a short sale. It’s not a secret that most homeowners who are in the process of negotiating a short sale live in their house mortgage and rent free.

While some might say this is unethical or even plain wrong, we are not here to judge. Besides, if one wants to play a moral paragon, isn’t walking away on mortgage is more wrong and reckless than settling with the bank?

“The Florida-Times Union” has published an article that illustrates a common scenario from a lender’s playbook. It seems surreal and outrageous to homeowners involved, however, this is so common, that all you need in order to have another valid story is just to replace names and locations involved.

James Kowalski, a Jacksonville attorney who’s been defending mortgage cases, said he’s seen a lot of confusion from lenders. Homeowners follow the instructions of one department at a bank, he said, only to find out they’re being foreclosed by another.

“It’s a very common refrain from the folks who are trying to go through one of the three solutions: Short sale, deed in lieu (of foreclosure) and loan modification,” he said. “What happens is the servicer will set up a department that will be taking the short sale application and that department does not talk to the default department.”

“The homeowner has to go to court just to undo what shouldn’t have happened in the first place.”

And go to the court they must! Recently National Closing Center has been working with a wonderful team of real estate attorneys. We have found out that going to court does pay off. However, all of the parties involved, including your Realtor, short sale negotiator and the attorney must be experienced and know what they are doing.

In most cases, working with a team of professional short sale processors will result in homeowner being in the know and prevent such situations from happening. That being said, some lenders are so disorganized and their departments are so disconnected from each other that sudden notices of foreclosure in the middle of negotiating a short sale do happen.