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        <title>Atlanta Real Estate Blog</title>
        <link>http://www.premieratlantarealestate.com/blog/short-sales/</link>
        <description>Atlanta real estate blog. Consumer focused real estate information for Atlanta and information and insight into local and national topics. Areas of interest include; Buckhead, Sandy Springs, Roswell &amp; Alpharetta. North Metro Atlanta.</description>
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            <guid>http://www.premieratlantarealestate.com/blog/short-sales-1011.html</guid>
            <link>http://www.premieratlantarealestate.com/blog/short-sales-1011.html</link>
            <author>ryan@premieratlantarealestate.com (Ryan C Ward)</author>
            <title>Short Sales 101 - HD Video</title>
            <description> <![CDATA[ 
This is a 3 minute video introduction on what a short sale is and who might be a good candidate for one. The transcript of the video is below.







Transcript


Hi, my name is Ryan Ward with Premier Atlanta Real Estate and Keller Williams. Thank you for your time with me today to learn about short sales. For too many reasons to go into today, the term short sale has become one of the most talked about types of transactions in the real estate market. So first, let’s make sure we get our definitions correct. A short sale happens when a lender agrees to accept a contract on a home when the sales price is less than the amount needed to pay off that mortgage. The bank is allowing the owner to sell the property “short” of the full payoff. So that’s the technical definition of a short sale.


Because of the downturn in the economy, most homeowners here in Atlanta and in other parts of the country who purchased their home after about the year 2000, have little to no equity in their homes. If you don’t need to sell your home you don’t need to worry about a short sale. If you have the money to bring to the table to make up the difference or if you do have equity, you also do not need to worry about a short sale. However, if you have lost your job, or you qualified for your home with 2 incomes and one of you is no longer able to work due to some specific reason - this could be health related, divorce, inability to find new work or many other problems facing Americans today, you might be a candidate for a short sale.


If you can no longer make ends meet and you are behind or it is imminent that you will fall behind in your mortgage payments, you need to talk with a specialist to see if you may qualify for a short sale and you need to do it as soon as possible. Don’t wait until you get a foreclosure notice to start looking for help!


Ok, so why may a short sale be better for you than a foreclosure?


Now, I do want to say that there are no guarantees when it comes to short sales. It’s an ever changing process, but it has greatly improved because lenders as well as their servicers are generally doing a much better job expediting the process than they did just a couple of years ago.


That said, it’s impossible to give specifics about how a short sale may impact your credit when compared with a foreclosure. Your credit standing with the 3 major credit bureaus and the methods they use to derive your credit standing are closely guarded secrets so I’m not going to stand here and say that a short sale with have less of a negative impact on your credit than a foreclosure.


I will say that if you can get back on your feet and begin repairing your damaged credit, you may be able to get back into a home faster by agreeing to short sale than you would if you went through a foreclosure.


So please - don’t wait - call me today. You MUST take action to help yourself. We will help.


Even if it means that we tell you that we can’t sell your home.


Our first obligation is to help. We are not going to try to sell you something or talk you into listing your home with us if it isn’t the right thing for you in your specific situation. You may need to speak with lawyer or a CPA before you can do your short sale as their are specific implications with the tax law, 1099’s and more, but we can’t help you you don’t call... There is no obligation - so please - do it today. Call now.
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            <pubDate>Wed, 14 Sep 2011 10:38:32 -0400</pubDate>
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            <guid>http://www.premieratlantarealestate.com/blog/foreclosures-activity-increases-6-in-february-nationally-lets-look-locally-too.html</guid>
            <link>http://www.premieratlantarealestate.com/blog/foreclosures-activity-increases-6-in-february-nationally-lets-look-locally-too.html</link>
            <author>ryan@premieratlantarealestate.com (Ryan C Ward)</author>
            <title>Foreclosure Activity Increases 6% in February Nationally, Let's Look Locally Too</title>
            <description> <![CDATA[ 
According to RealtyTrac, foreclosure activity is up 6% in February of 2010 compared with the same time period in 2009. This represents the smallest increase in activity in 4 years. To me, that doesn't mean we are seeing improvement and there isn't anything to indicate that we are heading towards consistent year of year decreases in foreclosures so in my opinion, this is still more bad news for home values.

Locally, foreclosure sales in February of 2010 were&nbsp;1245 compared with 1430 sales for the same time period in 2009. Interestingly, non-foreclosure sales in 2010 totaled 1598 meaning that foreclosure sales made for about 44% of sales in 2010 while in 2009&nbsp;non-foreclosure sales&nbsp;were 1512 or 48.6% of sales. In 2008, non-foreclosure sales totaled 2182 with an additional 1112 sales that were foreclosures or 33.7%.

So, as a percentage of total sales, foreclosures year over year over year in February were: 2008 --&gt; 33.7%, 2009&nbsp;--&gt;&nbsp;48.6% and 2010 --&gt; 44%. Certainly 2010 looks a little better, but, there are still plenty of sub-prime loans to go bad.

Compounding the sales price problem is the increasing number of sales that are &quot;lender mediated&quot; sales, better known as short sales. Unfortunately collecting this number from either of the multiple listing services in Metro Atlanta is difficult as there&nbsp;has only recently been added official fields marking listings as short sales. On a national level, short sales have actually surpassed foreclosures in sales volume according to this housingwire.com survey. This combination makes it difficult to regular resale sellers as well as new construction.

Myth: Alpharetta and the North Metro are Immune

Don't believe anyone who tells you this. There is no area and no price point that is not being directly and indirectly affected by short sale and foreclosure sales. Whether you are looking at one million plus in Buckhead or any price point in Alpharetta, Milton or the rest of the northern suburbs, your home value is directly impacted. If you bought your home in the last 3 years or so, you are almost certain to be upside down. There are few exceptions.

Most agents aren't willing to be straight about these numbers because they are afraid it will keep you from listing your home or buying another one.

There are Bright Spots, But not Many

Some areas and price points have 6 months or so of inventory - but prices still won't be rising anytime soon. More REO and short sales will ensure that doesn't happen. It does mean that the bleeding has stopped for some and it means something more if you are a buyer in an area that is starting to get closer to being a balanced market; you snooze, you lose!

In Alpharetta and Milton, west of GA 400, there is a 9.5 month supply of homes and that is looking at December and January numbers.&nbsp;With the end of the tax credit, we might expect this to go down even further to to a sales surge. We'll see if that actually happens though.

&nbsp;
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            <pubDate>Fri, 12 Mar 2010 08:51:50 -0500</pubDate>
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            <guid>http://www.premieratlantarealestate.com/blog/short-sales-and-distressed-properties-in-atlanta.html</guid>
            <link>http://www.premieratlantarealestate.com/blog/short-sales-and-distressed-properties-in-atlanta.html</link>
            <author>ryan@premieratlantarealestate.com (Ryan C Ward)</author>
            <title>Short Sales and Distressed Properties in Atlanta</title>
            <description> <![CDATA[ 
It's with great enjoyment&nbsp;for me&nbsp;to announce that I became a Certified Distressed Property Expert today. Since I began my career in real estate, my #1 goal has always been to help people. Like most real estate professionals today, I thought I could ignore this segment of the market - but recently I realized that this isn't a &quot;segment&quot; of the market, but is instead a segment of our society.

Instead of avoiding these homes and homeowners or casting blame upon them, I believe the best solution is to ensure that they are being represented in the best possible way to protect them from potentially fraudulent predators and to protect home values and neighborhoods by helping to keep these homes out of the foreclosure process and become REO properties.

In the coming weeks, I'll use this blog because of its high profile nature to talk more about how to avoid foreclosure if you are a homeowner in distress, but if you come across this blog post an need immediate assistance, please pick up the phone and call me.

Becoming an expert in this market is first about trying to help homeowners. That can be to help keep them in their home or to help them avoid foreclosure altogether. It's not about earning a paycheck.

And that fits with my moral compass very well.
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            <pubDate>Sun, 07 Feb 2010 13:15:48 -0500</pubDate>
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            <guid>http://www.premieratlantarealestate.com/blog/auctions-and-value-things-arent-what-they-seem.html</guid>
            <link>http://www.premieratlantarealestate.com/blog/auctions-and-value-things-arent-what-they-seem.html</link>
            <author>ryan@premieratlantarealestate.com (Ryan C Ward)</author>
            <title>Auctions and Value - Things Aren't What They Seem</title>
            <description> <![CDATA[ 
Sold to the lady in the back for $435,000! What a deal! The screen says the previous value for this home was over $1,000,000. I've found it at last! Now I know exactly where to send every person who calls looking for that great deal. The auction!

If you're in the business and you get leads online, you definitely know the guy. Most others in the business know this guy now too. It's just a product of the current conditions. He acts like he knows more than you about real estate and before the phone call is over, he has made you feel like it's true. We get one almost daily, but the problem is, that guy doesn't have a clue about what he is talking about. If you are that guy, I suggest you re-read this paragraph.

I attended an auction this past Saturday with a friend/client as an exploratory event as a possible place to pick up homes that are in need of small repairs that can be flipped. My job is consultant here. The commission checks are small from auctions, but, it's more important to me that he buys the right houses at the right prices otherwise there is no chance to flip so it's a win/win partnership if I find the right houses. As this was a bit exploratory for both of us, I decided to pick a few houses to really watch closely at auction for a number of reasons. I wanted to know what the real &quot;previous value&quot; was, I wanted to know what they would sell for at auction and I figured the after repair value prior to getting there so I was ready to see how this unfolded.

The Auction

First, I need to say that it was quite a rush. I'd do it again. I think I will actually. The truth though, is considerably different than most people I have spoken with think it is as it relates to values and auctions. Of the homes I watched, none sold for the price I believed they needed to be purchased for anyone other than an owner occupied home. In other words, they sell for fair market value. Some for more than market value, but, that too is to be expected as the auctioneer is awesome! There are other homes - like those that might be in new construction neighborhoods that decimate value fro the entire neighborhood instantly. I watched as 6 houses were sold for between 80K - 90K where the values were in the 150's. Now, the 80K home isn't even a &quot;deal&quot;. That's what the whole neighborhood is worth! Look, if you don't know values going in and you rely on the information on the screen you are going to get burned and speaking of that information on&nbsp;the screen, it's hardly accurate. I don't know where it came from, but, most of these homes have histories that I can look up in 30 seconds to determine and let me tell you what was on screen and what the real &quot;previous values&quot; were did not match. It made these homes look to be much better deals than they really were. I saw a home that I said should sell for no more than 425K sell for 412K, but, the &quot;previous value&quot; was wrong (over 800K, it was never woth that). Later I saw something that they said was over one million dollars sell for a little over 400. It was listed in the 500's in the FMLS and didn't sell. Where is the great deal there? This is what happened over and over and at all different price points. &quot;Previous value&quot; of 115K, starting bids at 500 dollars, listed in the FMLS for $17,000 and selling for $10,000. Do you think that is a good deal? I could go on...

I watched for a few hours and was amazed at how free markets correct themselves so efficiently if allowed to do so. But, it occurred to me also that the deals really aren't that great - at least not on the whole and that makes them no different than regular listings for sale (unless you are the bank because they do liquidate properties). There are good deals and there are not so good deals. The problem with getting a good deal at an auction is as follows:

You have a room full of ready, willing and able buyers offering multiple offers on properties. None of that is what you want when you are in the market for a &quot;deal.&quot;

So, the takeaway goes something like this...most of the homes for sale at auction were already for sale. Some have histories that go back years now so we know a lot about these homes. Most of them sell for what they would sell for in a fair market sale. These are the homes that were listed too high to sell or did not have good enough marketing to illicit an offer that might have been acceptable to the bank. None of these homes made exceptional deals and most importantly....

Nobody bought a home for 40 cents on the dollar!
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            <pubDate>Mon, 26 Oct 2009 10:06:21 -0400</pubDate>
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        <item>
            <guid>http://www.premieratlantarealestate.com/blog/short-sales-101.html</guid>
            <link>http://www.premieratlantarealestate.com/blog/short-sales-101.html</link>
            <author>ryan@premieratlantarealestate.com (Ryan C Ward)</author>
            <title>Short Sales 101</title>
            <description> <![CDATA[ 
If you are in the market for a home or are trying to find a way to sell your home and feel you are upside down, you might think that the best option is a short sale or a foreclosure. In subsequent posts, I'll get into more detail about foreclosures and if you want to skip this, you can go straight to our Atlanta&nbsp;foreclosures page or our Atlanta MLS page to search for short sales more specifically.

I'd like to&nbsp;go over short sales first because there is definitely more confusion over them, more contract issues and more complications with getting them closed than foreclosures. In my experience, they are more difficult than most other transactions right now. With all of that said, they can also represent an excellent value - but not all the time and not for all people. To buy or sell a short sale, you need to have time. Lots of it and often times it is an indefinite amount of time. They&nbsp;typically take 3-4 months to close, but,&nbsp;can take 9-12 months as one agent in our office has been working on one since 2008. At the time this&nbsp;is being written, it will be&nbsp;10 months and still no answer on that one. The point is that if you want a short&nbsp;sale, you can forget the $8,000 tax credit,&nbsp;unless you don't really care if you get it because a guaranteed closing on a short sale prior to December 1st is impossible to guarantee. A short sale really is what it sounds like - the seller is trying to &quot;short&quot; his mortgage by asking the bank to accept less than what the seller owes. If you want a bank to accept less than paid in full it's going to take some time. Here's why:

Short sales have been around for a long time. That's not new. What is new is how it's being used by homeowners in a declining market and what constitutes a hardship. There are now&nbsp;more homeowners applying for a short sale than ever before and for many banks the prospect of foreclosure may be more expensive than the short sale so the bank may be inclined to accept a short sale.

About 18 months into the business I had my first experience with a short sale. My very first clients ever needed one because&nbsp;the husband died of Leukemia and&nbsp;she could no longer afford the house on her salary. To make&nbsp;things more difficult, they had a one year old baby shortly after they closed on their first home. It was a terrible situation and one that I spent a lot of time learning and researching how best to help her.&nbsp;I learned a great deal about short sales because of that very first one I put so much energy into. She applied for a short sale from the lender and was ultimately&nbsp;approved. The lender ordered an appraisal, the negotiator at the bank told me what their bottom line was and I listed the home at a price to achieve the bank's goal. Once we received an offer, we provided a HUD-1 (settlement statement) for the bank to review to make sure it met their bottom line and we closed a few weeks later. This was before the sub-prime mess and before the banks got flooded with short sales and foreclosures so the process was over in about 60 days start to finish. 

The Process&nbsp;

Today the process is very different and every lender has a different timeline and slightly different method. There is a cottage industry that has sprouted up with attorneys claiming to represent sellers to help get a short sale approved faster than can be done by the homeowner - I'm a bit skeptical, but, it's probably effective for some. It's just that there is no reason for it when a short sale expert real estate agent can easily handle it for you just as easily without injecting a third party into the process. There are also real estate agents who claim to be able to help other agents with just the short sale approval process - another middle man to me but maybe more effective as they are really just trying to help the listing agent get the short sale process moving more quickly. To be effective, you need bank forms and contact numbers that only come with experience in the short sale business. The number of short sales in the current market is so high that many lenders want an offer on a home before they will even consider a short sale. This is&nbsp;difficult for many to understand&nbsp;because you don't actually know for sure what defines a &quot;hardship&quot; so there can be uncertainty with whether a homeowner will ultimately be approved. With experience, we know what some things are that constitute a hardship, but, as a seller, you need real guidance on this. You will need to call me and talk about your specifics if you want me to&nbsp;explain what does and doesn't constitute a potential hardship.

The process is pretty straightforward. You work with the loss-mitigation department and typically fill out some financial forms from your lender and send them back. You are not likely to get anywhere until your paperwork is 100% complete. This part of the process can take a long time. A large institutional lender who has the loan of someone we are currently working with told us 3-4 months to hear if they would even be approved. You then need a loss mitigator&nbsp; - a negotiator for the bank - to order a BPO (Broker Price Opinion) or an appraisal for the home. Then the lender will at least know what they are working with and can accept or reject an offer. This can take time and there is a bit more to the process, but, that's basically how it begins.

The Contract&nbsp;

Then there are contract issues. They come from both sides of the transaction. A short sale really is a regular sale between a buyer and&nbsp;a seller that is contingent upon bank approval and binding when signed by the buyer and seller.&nbsp;It does not become binding when the bank approves it so what we see in practice is that many homes listed as short sales have such a compelling price that they illicit multiple offers. In a short sale scenario, a seller is not concerned with the net profit so often times they will sign all the offers and try to submit them all to the bank - this results in multiple buyers who may have a binding contract to purchase the home! A terrible mess to say the least.

As an expert in the field and with the help of an attorney, we have drawn up specific language to protect us as listing agents for short sales and for buyers agents for short sales to help protect all parties from mishaps from other parties and from ourselves sometimes :) but, they are not online somewhere and I am not going to post them&nbsp;online for all to see/take/share and add potential liability to myself if they aren't used correctly. You need a true expert to help you if you are buying or selling a short sale. Your family member in the business that is struggling in the bad market is the absolute last person to entrust this with.

Call Us

If you think it may be time for you to try and find a way out of a bad situation, call us and we will answer your questions and give you some honest advice on whether or not a short sale might be a realistic option. We aren't going to steer you one way or another.&nbsp;We need to know&nbsp;as much as possible&nbsp;in order for us to help you and us understand the entire situation. Just know that there is help available if you need it.

One Last Thing

Do not make the first phone call or inquiry about your position to your lender! They are under no obligation to accept a short sale so they are also under no obligation to answer your questions without finding out pertinent information which may cause them to decline you for a short sale. Call us or another professional first.
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            <pubDate>Thu, 27 Aug 2009 10:39:05 -0400</pubDate>
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