Short Sale Success: What is an Acceptable Hardship?

 

A short sale, in most instances, is a complex transaction. However, there are two very simplistic characteristics that every qualified short sale possesses:

1. The house must be valued at less than the homeowner owes on their mortgage debt obligation. In other words, the home must be “underwater”.
2. The homeowner must have a qualified hardship.

It is the second characteristic that we would like to touch upon in this blog post.

One question that we answer frequently is “My house is underwater. Is this an acceptable hardship?” Unfortunately, the answer is always “No.”

The simple fact that a homeowners mortgage obligation is in excess of their house value is not an acceptable hardship. A Short Selling bank will entertain a short sale when and only when there is a hardship that will, now or in the future, affect the borrower’s ability to pay their mortgage.

The following is a list of acceptable hardships that may be used when submitting a short sale package:

• Mortgage Rate Adjustments
• Loss of Employment or Reduction in Wages
• Business Failure
• Medical Hardship
• Death in the Family
• Divorce/Separation
• Military Service
• Overwhelming Debt Obligations
• Job Relocation

As always, should you have questions as to the acceptability of a hardship scenario, you should seek advice from an expert that has been trained in the short sale field. Look for the REALTOR®  Designation.

    Neal Paskvan  a Downers Grove Real Estate Broker holds the SFR Designation and may be able  to help

Reach Neal with Barird Warner at 630-964-1855 or e-mail him at neal.paskvan@bairdwarner.com

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Mortgage Rates Hold Near Record Low - WSJ.com

Fixed mortgage rates in the U.S. again held near record lows over the past week, according to Freddie Mac's weekly survey of mortgage rates.

For the latest week, the survey's results found the average rate for a 15-year fixed-rate mortgage fell to just above its all-time low of 3.26% hit in October.

The 30-year fixed-rate mortgage averaged 3.99% for the week ended Thursday, down a tick from 4% the previous week and below 4.61% recorded a year earlier. Rates on 15-year fixed-rate mortgages averaged 3.27%, down from 3.3% a week earlier and 3.96% recorded a year earlier

Click here to get the rest of the story

Real Estate 2011: House Prices in Chicago and the Suburbs - Chicago magazine - October 2011

 

THE NEW NEW RULES OF REAL ESTATE: Eleven years ago, Chicago offered a guide to making the most of the sizzling-hot housing market. What a difference a decade makes. Now, confronting the realities of today’s pinched economy, local real-estate pros weigh in with the best strategies for buying or selling a home. PLUS: Our annual survey of housing prices in nearly 300 neighborhoods and towns

By Dennis Rodkin

RULE NO. 1   Yesterday is gone

RULE NO. 2 Don’t play the “let’s just see what happens” game.

 

Get the rest of the story from Chicago Magazine by Dennis Rodkin here

6 lowball-offer errors home buyers make - MarketWatch

CHICAGO (MarketWatch) — For some home sellers, it was a long summer without a home sale. That means this fall, some buyers — smelling the desperation — may be able to cut a better deal.

Read rest of the story here

Real Estate is Not DEAD!

To all those who have declared the real estate market dead, we want you to know that over 13,780 houses sold yesterday, 13,780 will sell today and 13,780 will sell tomorrow

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Another Luxury Home Sold Neal Paskvan Baird Warner

A Tip on Keeping Cool

Something to check before you call the AC repair man

If you feel your AC is not really keeping up inside, with the hot outside, you may want to check your whole-house humidifier and make sure it is unplugged! Putting humidly into the air wile the AC is working to remove it is, well, not cool. Sometimes the humidity controls upstairs get stuck and don't really shut the humidifier down.

Neal Is a Full Time Broker Helping Home Buyers and Sellers Move ON and Move Up

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Save on Gas.  Check out Open Houses on Line First. If you see a Home that May be  Right for You.
Call me and I'll get You all the Details and Help you make sure you can afford it

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Fact is.. You May Need to Sell Your House Twice

Appraisals: Why You Must Now Sell Your House Twice

by Neal Paskvan on May 24, 2011 ·

Bottom Line

Every house now has to be sold twice: FIRST, to a potential purchaser and THEN AGAIN to the bank appraiser. And, it seems that the second sale may be the more difficult of the two. Sit with a local Real Estate Professional and make sure you put together a plan for both sales.

inShare

Banks have become very conservative when lending mortgage money today. With the current foreclosure challenges in the country, we can’t really blame them. The requirements now necessary to qualify for mortgages have gotten much more stringent and it seems will get even more stringent as we move forward. The banks want to make sure the prospective buyer has the ability to repay the loan. However, this does not just involve the borrower buying the property.
The second way a bank can protect their investment in the mortgage is to make sure that the collateral backing that mortgage is secure. That is where the appraisal comes in. The bank wants to make sure that, should the buyer not be able to make their payments, the house they will be forced to take back will sell for an amount at least equal to the balance left on the mortgage. For that reason, the banks seem to be getting more conservative with appraisals also.
This past week, the National Association of Realtors (NAR) released their Existing Homes Sales Report. In that report, they said:

“11 percent of Realtors® report a contract was cancelled in April from an appraisal coming in below the price negotiated between a buyer and seller, 10 percent had a contract delayed, and 14 percent said a contract was renegotiated to a lower sales price as a result of a low appraisal.”

One out of four real estate transactions was either cancelled (11%) or renegotiated to a lower sales price (14%)

Contact me if you would like an Update   630-964-1855 or E-mail at neal.paskvan@bairdwarner.com


Research  Provided By Keeping Current Matters   http://kcmblog.com/2011/05/24/appraisals-why-you-must-now-sell-your-house-twice/