Many Americans are Hoping for a Loan Modification

wikipedia defines hope as:

“A belief in a positive outcome related to events and circumstances in one’s life. Hope is a feeling that something desired may happen, when the outlook may or may not warrant it.”

When I traded stocks I was taught that four letter words hurt [...]]]>

Many Americans are Hoping for a Loan Modification

HOPE!

wikipedia defines hope as:

“A belief in a positive outcome related to events and circumstances in one’s life. Hope is a feeling that something desired may happen, when the outlook may or may not warrant it.”

When I traded stocks I was taught that four letter words hurt you as a trader more than they helped you. The main bad words were FEAR and HOPE.

FEAR kept you from fully maximizing on your trades and HOPE kept you in them long enough to pay the hefty price.

Now as a Real Estate Broker I meet people who are in danger of losing their home to foreclosure. Like stocks, the real estate market has its ups and downs. And like stocks the same emotions play out. Fear and Hope are prevalent. Of those I think HOPE is worse,  its hurting people more than just having a foreclosure.

EXAMPLE

We will call this person Tom,

Tom was behind on his mortgage three months and $14,000 in back payments not including fines and looming legal fees. Based on public record I knew he was in need of my services and offered to do a short sale on his property. He told me that he was working on getting a loan modification. It made sense, he was working but went thru a divorce and this hurt his ability to stay current. He just had to prove to the lender that since the property had lost 50% of its value it would be in their best interest to work with him.  So he had his buddy refer him to an attorney who was going to work on the loan  mod. The attorney charged him $4,000 to work on his file and off they went.

Five months later the banks responded… DENIED! Tom thinking that his attorney didn’t know what he was doing  fired his loan modification company and hired another one he heard on the radio, they charged him $4,500.

One month later after the loan mod company didn’t return any phone calls or emails he decides to visit the location only to find out that the business had gone bankrupt, Ouch!  (people still think radio and tv add credibility!)

But he was still hopeful so he paid a third company $3,000 to help him. This company did work on it like the first had and three months later he got his answer. DENIED! What!! how could this happen, it doesn’t make sense. The government said that programs exist and that banks had to help people!! Arrrrgh!! How could this happen you say, it doesn’t make sense, banks took tarp money!!!!

Well what happened is the investor sold the note the moment that Tom’s loan went into default. Huh? what does that mean you say? That means that the servicer or bank as most people know them (Bank of America, Chase, Citi) don’t own the loans. Investors do,banks hold a small number of loans but not many. So the many investors who do own these loans sell them to other investors who buy bad debt. Sometimes the same attorney who helped your on the loan mod is buying bad debt to resell. (yes it happens, I have had bank reps tell me that attorneys are there best note buyers, especially on second loans.) Don’t act surprised, these are the waters you enter when in these situations.

Most investors don’t know the homeowner and yes they don’t care. All they know is that they lent money for the purpose of collecting a profit, short or long term the word is PROFIT. Like your 401k at work, you save to be able to retire and live off the interest. Some of these loans were actually purchased with other peoples retirement money but that is a whole other topic for another day.

So again, without the homeowner even knowing, the investor sold that $380,000 note for $90,000 (property worth 180,000) The new investor has purchased the note for ONE REASON, LIQUIDATION. The old investor probably did it for tax breaks , or maybe his buddy buys it to resell, who knows, the point is money is moving. and Toms house is the prize!

Not FAIR right, well there’s another four letter word for you. Maybe they have LUCK, and Tom needs real HELP, see a pattern here?

We spoke with an exec at Bank of America who admitted that only 10% of loan mods have been made permanent. Of those 10% they did, 80% re defaulted.  So why are the banks pushing them if they really don’t help??? Well like we said earlier, gov programs! They have to try and help even though many people will be denied, its called Public Relations!

But back to Tom…

So after Tom paid $11,500 of hope money he was told SORRY. We are foreclosing next week!  So again hopeful Tom sues the bank which delayed the foreclosure for a week.  And then the day came, FORECLOSURE! No stopping the train, this was done and done. Right?

Well hope reared its ugly head again, this time he hoped that he could reverse the foreclosure and hope that the bank could not make him leave his home. After a couple of misfiled court documents and other delay tactics he was eventually evicted.

So hope won him

$11,500 in fees, foreclosure and finally eviction, all in his credit record for him to keep for 10 years. From here on he can HOPE to get cell phone or lease on apartment in the near future.

This is a real scenario by the way.  I have been in situations where the banks have screwed up and this was the only tactic left. But this was not Tom’s case at all.

Tom should have short sold the home. He owed about $400,000 for a home that was worth $180,000. What if he was successful with the loan mod? What did he actually accomplish? He would really be renting his home without a landlord. It would be a temporary fix at best.  He would be responsible for repairs, insurance, and taxes only to have issues with the loan in 2 to 5 years. He could have rented a MUCH, MUCH NICER HOME while his credit improved.

The WORST PART OF THIS STORY is he would be ready to buy right about NOW because this happened 2 years ago. He would have been eligible to buy again. And those 11k would have been perfect for a down payment.

I guess when it comes to business, hope and money don’t mix!

Michael-Edward Cruz
California Real Estate Broker 01758933
760-689-BANK (2265)

http://www.mikerebroker.com

http://facebook.com/mikerebroker

Example:   This home is in San Bernardino County the mortgage is 399,000.  With a 7 % interest rate the payment is about$ 2654.55. plus taxes and insurance $3150 per month. Its now worth about 130,000

Your loan [...]]]> For what you pay for (or are not paying) on  small home, you could rent a mini mansion

Example:   This home is in San Bernardino County the mortgage is 399,000.  With a 7 % interest rate the payment is about$ 2654.55. plus taxes and insurance $3150 per month. Its now worth about 130,000

Your loan is $399,000 the home is worth #130,000

They are never going to modify the loan. Even though they make you think they will.

So instead, why not short sale your home and then for around same price you can rent this:

For the same price your could be living here

Obviously if your not paying your mortgage their is a good reason. The point I am trying to make is you have to be smart and know that you can recover from situations like this and sometimes it does not make sense to get lured into ideas that will not work. I have met many homeowners who have been told they might qualify for a modification. Only to find out they were just acting like they wanted to help.

When you ready to get back to happiness, call us and we will help you short sale your property.

Michael-Edward Cruz
01758933
760-689-BANK

See below

If you need a Real Estate Team that understands the market, give us a call.

Real Estate Insight Team Keller Williams Short Sale Experts 951-572-2789 760-689-BANK (2265)

According to the guys at the TBWS Daily, the National Association of Mortgage Brokers conferance put to sleep the rumor that FHA down payment requirements were going to climb from 3.5% to 5%.

We will update you as soon as the official statement is released.

If you or someone you know is in danger of losing your [...]]]>

According to the guys at the TBWS Daily, the National Association of Mortgage Brokers conferance put to sleep the rumor that FHA down payment requirements were going to climb from 3.5% to 5%.

We will update you as soon as the official statement is released.

If you or someone you know is in danger of losing your home to foreclosure, call us!

760-689-BANK (2265) state your name and your situation and our team of specialist will call you for a free consulation.

http://shortsalemc.com/

by Michael-Edward Cruz – California Real Estate Broker 951-572-2789

I found a promising article detailing how some lenders are beginning to shift their focus from foreclosure to short sales. Unfortunately I could not link to it on my blog due to copyright laws.

Some Lenders are now considering short sales as a real solution. AFTER the mass [...]]]>

by Michael-Edward Cruz – California Real Estate Broker 951-572-2789

I found a promising article detailing how some lenders are beginning to shift their focus from foreclosure to short sales. Unfortunately I could not link to it on my blog due to copyright laws.

Some Lenders are now considering short sales as a real solution. AFTER the mass foreclosures in 2007 – 2008, AFTER the disaster in modifications in 2009, they might finally be listening to us.

I can’t really complain though.  Before I worked for this team lead by Troy Huerta, 2 out 3 of my deals foreclosed!  I was a typical agent throwing darts in the dark and having the closing figures to show for it.  My success rate was less than 33%.  Since teaming up with Troy, my success rate is an admirable 100%, so far.  This year alone our team has already closed 20 transactions!!!

A big part of my difficulty stemmed from my lack of planning to deal with lenders rather than the lenders not actually listening.  Lenders will always find ways to make more and more money no matter what.  Otherwise, how will their CEO’s be able to remodel their offices for less than $2 million?  When dealing with our pre-foreclosure transactions, we focus our job on showing them that a short sale is better than a foreclosure.  Most of the time a short sale is better, unfortunately it is not always easy to get the lender to understand. That is why I have teamed up with Troy Huerta from the Real Estate Insight Team at Keller Williams.

Troy Huerta has been featured by Smart Money magazine (a Wall Street Journal

publication) as a Power Broker. The impressive part of Mr. Huerta’s success is his fundamental understanding of the short sale process and his ability to turn nearly every transaction into a win-win-win situation for lenders, sellers, agents (and buyers).  Armed with a strong lending background, Troy foresaw the market turn and did everything he could (including purchasing a local and well-established real estate office) to position himself one step ahead of the rest.  The first year (June 2007 – June 2008) he had successfully closed 50+ short sales at a time when offices were folding like houses of cards and agents were being driven from their once thriving (and easy paced) careers.  His understanding of how lenders work has made him the “go to guy” on short sale transactions. He has held DRE credit courses on short sales and currently designates certificate courses for agents looking to break into this market. His success has been truly amazing. He has a great team that I am lucky to be a part of.

After my first experience as an REO agent, I knew that this was not the answer for me in this market.  The whole experience was not worth the money I made when the sale was finalized. I went into this business to help people realize their dreams of homeownership, not contribute to the nightmare of foreclosure.

I am happy with my choice to be persistent and find a way to become successful with the short sales. Most agents ran from this (sooner or later). Most of the agents I have talked to have said “It’s too much work”, ” I hate dealing with lenders” and my favorite, “they take forever to close”. I agree that they should not work on short sales.  You have to love it and “get it” like we do.  A comprehensive list of negotiators you’ve closed with in the past doesn’t hurt either.

While our primary focus is on listings and homeowner assistance, we offer professional negotiation services to agents who can’t or don’t want to handle the negotiation portion of their transactions.  Our system of short sale closings enable us to continue our success as things get “easier”.

WITH LENDERS WORKING WITH US + OUR SUCCESS WHEN THEY WERE NOT = THE ABILITY TO HELP AS MANY PEOPLE AS POSSIBLE IN 2010

Are you late on your mortgage?  Do you have an NOD and are in danger of foreclosure?  Do you know someone who is struggling to make ends meet?  Is the loan modification game getting you tired and at greater risk of foreclosure?  CALL THE NUMBERS BELOW, LEAVE A MESSAGE WITH YOUR SITUATION AND A SPECIALIST WILL CALL YOU TO DISCUSS YOUR OPTIONS

North San Diego County – 760-420-5498 – http://lenderhelpinc.com

South Orange County – 949-630-9743 – http://shortsalemc.com

South Riverside County – 951-BANK-GIRL – http://livinginharveston.com

Their is no way to guarantee anyone that a modification will [...]]]> I have personally helped many people modify their home loan. But with so many predators out there the State of California made it illegal to charge for these services. Still when people try and do this on there own it takes a toll on them.

Their is no way to guarantee anyone that a modification will work. We simply showed people our results. Ironically many people we helped eventually realized that modifications didn’t really help them in the long run.  Many people later decided to short sale. I have two like this right now. Another thing they don’t tell you is that you will miss out on many incentives and tax breaks to short sale now.

As well you can in some cases get a home loan a day after you short sale your property.  So to me modifications suck !!! still here is an interesting article I found on what is accurately headlined as

MORTGAGE MODIFICATION HELL

If you or someone you know are having difficulty paying for you home call us

Troy Huerta (Short Sale Team Leader for California)

Michael-Edward (Short Sale Specialist)

951-572-2789 South Riverside County – Temecula Redhawk – Home Office
949-630-9743 South Orange County Office
760-420-5498 North San Diego County – Troy Huerta – Team Leader

Here is an interesting article I found that illustrates the banks creative way to boost profits, even with Government intervention.

Like I keep telling people, all [...]]]> I personally do not use credit cards any longer. I would rather deal with the mob when borrowing money. At least they kiss you before they _ _ _ _ you.

Here is an interesting article I found that illustrates the banks creative way to boost profits, even with Government intervention.

Like I keep telling people, all this would stop if we as consumers would just stop using their services. Remember they are not forcing you to use them.  I will say that next time they come looking for a bail out say HELL NO! They can afford it!

CREDIT CARDS AND THE LOVELY BONUSES FOR THE CONSUMER

If you or someone you know are having difficulty paying for you home call us

Troy Huerta (Short Sale Team Leader for California)

Michael-Edward (Short Sale Specialist)

951-572-2789 South Riverside County – Temecula Redhawk – Home Office
949-630-9743 South Orange County Office
760-420-5498 North San Diego County – Troy Huerta – Team Leader

You would think that they would at least stick to foreclosing [...]]]> With Banks coming out on top with the bail out money, making BILLIONS on ridiculous overdraft fees that hurt those weakest to fight back and being able to make a double profit on foreclosure by buying other banks bad debt cheaper then getting government money……

You would think that they would at least stick to foreclosing on homes they owned.

The story below shows the power and arrogance that is Bank of America.

BANK OF AMERICA – THE NEW EVIL EMPIRE

If you or someone you know is in danger of losing your home to foreclosure, don’t deal with them on your own. Get expert help, call us today.

Michael-Edward Cruz
Short Sale Specialist
951-572-2789

Troy Huerta
Team Leader
760-420-5498