Why don’t You Have Your Picture on Your Site or Business Card?

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Enough Said.

I Just Completed a Short Sale. How Long Before I Can Get a New Mortgage?

As I tell my clients, I am a real estate professional. That means I am an expert in buying, selling, marketing and valuations of residential real estate. I am going to defer to a mortgage expert for this answer.

This answer is by Matt Bukovy, Sr. Mortgage Consultant at Wintrust Mortgage

To qualify for an FHA LOAN after a Short Sale: You must either wait 3 YEARS from the date sale closed and transferred to new owner. There is (theoretically) no waiting period if the borrower had no late payments on ANY mortgage or consumer debt within the 12 month period preceding the short sale AND they are not taking advantage of declining market conditions, but … seriously … that’s exceedingly unlikely.

For CONVENTIONAL LOANS, it’s more complicated:
7 years from date sale closed and transferred to new owner or transferred back to bank for new loans with less than 10% down payment.
4 years from date sale closed and transferred to new owner or transferred back to bank for new loans with 10% down payment.
2 years from date sale closed and transferred to new owner or transferred back to bank for new loans with 20% down payment.
2 years from date sale closed and transferred to new owner or transferred back to bank for new loans with 10% down payment and acceptable extenuating circumstances.

As far as acceptable extenuating circumstances are concerned, they need to be documentable and verifiable nonrecurring events that are beyond the borrower’s control and cause a sudden, drastic and prolonged reduction in income. Death of a wage earner and catastrophic illnesses would count, divorce would not (since that is within the borrower’s control.)

So, as a rule of thumb, since it seems unlikely that someone with a 10 or 20% down payment would be ALLOWED to short-sell, most of the time, it’s going to be three years before you can get an FHA loan, and 7 years to get a conventional one.

If I do a Short Sale, What Will Happen to my Credit?

This is a very important question for anyone considering a short sale to prevent foreclosure. The effect on your credit can affect you life for many years down the road.

There is no clear answer for this question, because each situation is different. There can be little effect and and there can be a dramatic change in scores from beginning to end. Things that can effect how your credit is changed are: How the bank records the sale; How many late payments did you have, if any; did you fall behind on your HOA and did they place a judgement on you. And that is just the short list.

You may want to consider talking to your tax adviser, your lawyer and your real estate professional before move forward with a short sale.

Does ‘For Sale by Owner’ Work?

Maybe. But in this economy, it’s tough. Just ask the owner of a ‘For Sale by Owner’ company that hired a Realtor to sell his poperty.

Founder of “for sale by owner” site calls in broker to get the job done

Mr. Sambrotto apparently spent six months trying to sell his fancy digs himself before turning to a broker. Jesse Buckler, the broker that Sambrotto hired, increased the price and managed to attract multiple offers before selling the apartment for $2.15 million, $150,000 more than the asking price.

Read more…

“$150,000 more than the asking price.” I think that answers that question.

Does price per square foot matter?

A great little article from Spencer Barron’s blog in Denver. If you need to buy or sell in Denver, Spencer is your go to guy!

Only to the lender. I should qualify that a bit. In a true apples to apples neighborhood in the suberbs, the price per square foot (PSF) of the comparable sold homes matter. Especially to the lender who will be lending on it. They need metrics like this in order to explain to shareholders why they lent the money.

Builders use price per square foot for an area to help project their potential profits compared to their cost to build.

Investors can screen neighborhoods for homes that are significantly below the average price per square foot for the neighborhood.

For you and I. We need to be more specific. One way is a comparative market analysis or CMA.

There is one certainy though, to determine the value of a property, you can’t simply take the square footage and multiply it by the area’s PSF or even the comparable home’s PSF. It’s just not going to get you where you want to go.

As an example, I once met a man that built a massive addition on the back of his house. He added over 2000 square feet (SF) to his home. He then did the calculation; my home is 3400SF X $200 PSF = $680,000. Unfortunately, he simply added massive rooms without any appeal to them. He added only one jack and jill style bathroom for the 2000 SF he added. That was supposed to be a shared master bath. Needless to say, buyers didn’t see it and had a 100 other options for under $680,000 that were superior.

He ended up selling for $385,000 or $113 per SF. For him, using price per square foot to determine his value sent him down the wrong path by more than 40%.

via Does price per square foot matter?.

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