Posts Tagged ‘Short Sales’
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Monday, December 6th, 2010
 Short Sales are going to be affecting the Ann Arbor Real Estate Market for the foreseeable future. Lenders’ treatment of short sale transactions has been evolving as you will see below.
Releasing the Borrower’s Liability
Lenders are vigorously reviewing borrowers’ financial abilities before releasing the borrowers form all liability. If the sellers have a good income or if they have assets other than the house involved in the short sale, then they are often required to sign a note for all or part of the deficiency created by the short sale. Similarly, the letter approving a short sale is frequently revised right up to the day of closing which forces the seller to accept new terms related to their liability at the very last moment before the sale closes.
Association Fees
Lenders can look at those fees as household maintenance expense which should be paid by the seller and not from the proceeds of the sale. If you are attempting a short sale with a condominium, ask the association if it would be willing to negotiate the terms of any outstanding homeowner’s fees.
Divorce
Married couples often execute mortgages together and both are equally responsible for the terms of the mortgage. In the event of a divorce, the divorce decree often requires that one of the parties assumes the liability of the mortgage. Lenders however, are not bound by that decree and will often hold both spouses responsible for the mortgage liability. If the property is the subject of a short sale, then the spouse assuming responsibility for the mortgage must check with the lender on the ex-spouse’s liability. Frequently a divorced couple must work together on a short sale. If the ex-spouse is held liable for part of the deficiency and does not approve the terms of the short sale, then the short sale will not close.
These are just a few considerations affecting short sales that have recently changed. If you are about to start the short sale process or are in the middle of negotiations, stay in frequent contact with your lender and your Realtor to minimize any unexpected changes to your short sale. Make sure your real estate agent has training and experience in successfully completing short sales transactions!
As always, we here at Prudential Snyder & Company Realtors are here to assist you with any of your Ann Arbor Area home buying, home selling, rental or other Ann Arbor real estate needs.
Call us at 734-747-7500 or 734-747-7700 weekdays, or 734-660-0105 evenings and weekends. We’re also available via email at info@prusnyder.com or online at www.prusnyder.com anytime.
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Tags: Ann Arbor, Ann Arbor House, borrower's liability, real estate market, Realtors, Short Sale, Short Sales
Posted in Foreclosures and Short Sales |
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Friday, October 29th, 2010
As foreclosures and short sales continue to complicate the resale market of existing Ann Arbor homes, some sellers may choose to lease their home with an option to buy. Before entering into this kind of real estate agreement, the seller and buyer should consider the following issues.
An option to purchase real estate gives the buyer the right to purchase a property at a specific price during a finite period of time. It can not be revoked by the seller and the buyer must exercise the option prior to the expiration date.
When a buyer exercises the option, it immediately goes into effect and should not require the buyer and seller to execute a separate purchase agreement. Therefore, an option agreement should spell out all the key terms of the purchase: price, when the sale will close, title insurance requirements, tax proration methods, inspections, etc. If the essential components of a purchase agreement are not made part of an option to buy, then the option may not be enforceable. Some option agreements allow for a portion of the rent to be applied towards the purchase price if the buyer exercises the option. Similarly, the portion of the rent applied to the purchase price is forfeited if the option is not exercised. Sellers may also include a clause that ends the buyer’s right to purchase if the tenant/buyer fails to pay the rent on time.
A buyer in a lease with an option to buy transaction may want to protect their interest in the home by recording it with the appropriate register of deeds. The option agreement can be recorded. However, this makes all the terms of the purchase public record. Rather than record the entire option agreement many buyers record a memorandum of option. This notifies anyone interested in purchasing the home that an option exists but does not reveal the specific terms of the agreement.
If there is an existing mortgage on the property then both the seller and buyer must be fully aware of the existence of a “due on sale” clause in the seller’s mortgage. Generally speaking, most mortgages have a due on sale clause which states that if all or part of the property is transferred without the lender’s written consent, the lender may require that loan become immediately due and payable. The specific language in this clause will indicate if a lease with option will trigger the loan becoming payable.
Sellers and buyers should also be aware that a leased home is no longer eligible for the principle residence exemption which causes the property taxes to increase. There may be local ordinances governing rentals which may require inspections, permits, etc. When a home becomes a rental, insurance rate often rise so it is important to discuss this with your insurance carrier before entering into a lease.
You can see that a lease with an option to buy has many components and factors that both buyer and seller must consider. The very nature of the agreement is complicated so as we frequently say in the real estate profession: “All parties should seek the advice of an attorney”.
As always, we here at Prudential Snyder & Company Realtors are here to assist you with any of your Ann Arbor Area home buying, home selling, rental or other Ann Arbor real estate needs.
Call us at 734-747-7500 or 734-747-7700 weekdays, or 734-660-0105 evenings and weekends. We’re also available via email at info@prusnyder.com or online at www.prusnyder.com anytime. Choose Prudential Snyder and Company for the best Ann Arbor Realtors!
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Tags: Ann Arbor, Ann Arbor Homes, Ann Arbor House, Foreclosures, home buying, home selling, lease with option, rental, resale market, Short Sales
Posted in Ann Arbor Rentals |
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Thursday, June 3rd, 2010
We ran this blog a couple of months ago, but in light of all of the recent news regarding short sales and the HAFA program developments, here’s a quick refresher!
 We keep hearing about them in the news, so what are they? Wikipedia defines a Short Sale as follows: A short sale is a sale of real estate in which the sale proceeds fall short of the balance owed on the property’s loan.
Once upon a time, being involved in a Short Sale held a stigma. It usually indicated that you were unable to make your payments. Today, that is not the case. Homeowners who are relocating due to job changes or other circumstances may qualify for Short Sale programs and it doesn’t have to destroy your credit rating.
Why is this so important to work with a specially trained Agent?
1. The process can be both lengthy and frustrating.
2. Not all Homeowners qualify for Short Sale programs.
3. IRS could determine forgiveness is income.
4. Your credit is at stake.
5. Release of lien is not the same as release of obligation.
6. Current government programs are changing rapidly.
7. Short Sale homes are sometimes stigmatized.
No one can guarantee the outcome of your Short Sale, but here at Prudential Snyder & Company, we have trained Realtors who are ready to answer your questions and guide you through the Short Sale process. We know the paperwork, the expectations, and the pitfalls of working with the banks. We will work diligently to make sure that the process is as low stress as we can make it.
As always, we are here in the Greater Ann Arbor Area to assist you with any of your home buying, home selling, rental or other real estate needs. Plus, we have a great network of Agents across the US who can assist with properties in other areas. Call us at 734-747-7500 or 734-747-7700 weekdays, or
734-660-0105 evenings and weekends. We’re also available via email at info@prusnyder.com or online at www.prusnyder.com anytime. Choose Prudential Snyder and Company for the best Ann Arbor Realtors!
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Tags: Ann Arbor Area, HAFA, home buying, home selling, Homeowners, real estate needs, rental, Short Sales, working with the banks
Posted in Foreclosures and Short Sales |
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Thursday, February 11th, 2010
Getting the best price is about bringing you the right buyers for your house. This requires a Rock Solid ® marketing plan, targeted media exposure and an extensive network of local and out-of-town buyers. When you work with an Ann Arbor based company with a global support and presence, you’re able to access unparalleled online technology, such as the Online Sellers Advantage programming.
At Prudential Snyder & Company Realtors, we pride ourselves on putting our consumers first. To that end, we have revamped our servicing programs to make information available early and often for all parties in a transaction. Check out our fabulous website with mobile phone search capabilities and ask about our new Relay technology!
We pride ourselves on our ability to work with consumers to find the best solutions for your specific needs. Our agents hold certifications and are specially trained to handle any situation. Whether you require a Short Sale & Foreclosure Resource Certified Agent, or specialty marketing for your Green Living home with an EcoBroker, a Fine Homes Specialist or any other special niche you may require, we can help you!
As always, we are here to assist you with any of your real estate needs. Call us at 734-747-7500 or 734-747-7700 weekdays, or 734-660-0105 evenings and weekends. We’re also available via email at info@prusnyder.com or online at www.prusnyder.com anytime. Choose Prudential Snyder and Company for the best Ann Arbor Realtors!
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Tags: Ann Arbor, Ann Arbor Home Search, Ann Arbor Homes, Ann Arbor House, Ann Arbor MI, Ann Arbor Properties, EcoBrokers, fine homes specialist, Foreclosures, Green Living, online seller, Search Ann Arbor Homes, Short Sales
Posted in Ann Arbor Realty |
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Wednesday, November 18th, 2009
We all know that there are no emotional ties between the bank negotiator and the homes they sell. They are looking at bottom line net prices only. So if you walk through a home and hate the carpet or it smells like animal urine, the walls are filled with nail holes, and there’s ½ inch of water in the basement, take that into account when you determine your offer price and/or ask for concessions in the original contract. Asset Managers understand that there are issues that may come up in inspections that were not known ahead of time, but if you write an offer and have it accepted, then go back to the bank and ask for items that should have been noticed and considered in your inital offer, they tend to get annoyed.
In order to make your transaction go as smoothly as possible, make sure you adhere to the following guidelines:
- Do your due diligence. Your Buyers Agent will assist you with confirming taxes, school boundaries, outstanding leins, square footage, etc.
- Make sure you have all facts gathered & inspections completed prior to requesting seller repairs or concessions.
- Include repair bids to expedite the negotiation process.
- Choose realistic closing dates. Underwriters are swamped and new guidelines that are bogging the process, so be sure to allow proper time.
- Listen to your Realtor. They are here to work in your best interest, they know the market, and they can usually get a feel for when you’re hitting the nerves of the negotiator. If your Realtor tells you to stand down on an issue, it’s probably in your best interest to do so. Remember, you’re not fully under contract until negotiations are completed and contingency removals are signed off on, so the bank can refuse to negotiate if you become difficult to work with, and move on to the next prospective buyer.
For many Foreclosure Asset Managers, the only issues that they will address are health and safety concerns. With short sales, often the bank will allow NO repairs or additional concessions. When a purchase is an “as is” sale, inspections done are for informational purposes only – the buyer will have the opportunity to walk away from the sale if the inspection issues are great, but it doesn’t mean that they will re-negotiate price.
As always, Prudential Snyder & Company Realtors are here to assist you with any of your real estate needs. Call us at 734-747-7500 or 734-747-7700 weekdays, or 734-660-0105 evenings and weekends. We’re also available via email at info@prusnyder.com or online at www.prusnyder.com anytime. Choose Prudential Snyder and Company for the best Ann Arbor Realtors!
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Tags: Ann Arbor, Ann Arbor Home Search, Ann Arbor Homes, Ann Arbor MI, ASSET MANAGERS, Foreclosures, HOME SALES, Homes for Sale, Investments, NEGOTIATION, Prudential Real Estate, Real Estate, Realtors, Short Sales
Posted in Ann Arbor Real Estate |
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Wednesday, August 5th, 2009
WELCOME TO THE FUTURE OF ANN ARBOR REAL ESTATE!
PREVIEW SUNDAY OPEN HOUSES – On the left side:
- go to “Listing Type“
- select “All MLS Open Houses.”
- scroll down, select “Go.”
SEARCH FOR ANN ARBOR AREA HOMES
In our commitment to being the Local Innovation Leader, we at Prudential Snyder & Company would like to invite you to CLICK TO THE FUTURE of Real Estate!
We welcome any feedback and suggestions: info@prusnyder.com. Choose Prudential Snyder and Company for the best Ann Arbor Realtors!
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Tags: Ann Arbor Homes, Ann Arbor House, Ann Arbor Properties, Chelsea, Dexter, Distressed Homes, Downtown Ann Arbor, Foreclosures, Mobile Phone Search, Open Houses, Saline, Short Sales, Washtenaw County, Ypsilanti
Posted in Ann Arbor Real Estate |
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