Tag: Short sales in Orlando Florida

Avoiding the Orlando Loan Modification Mine Field

Posted on by Jenny Zamora

Loan modifications have helped thousands of Orlando homeowners to keep their homes.

However, you must be aware of the fine print and know exactly what it will mean to you. Sometimes the terms of a loan modification are often worse than the original mortgage. The best loan modifications are when you are able to not only reduce your payment but reduce the principal balance of the loan. Many loan mods are structured so that your payment gets reduced but you still have to pay off the entire amount of the original mortgage plus penalties. In my opinion, these types of loan modifications are just not worth agreeing to. If your house is only worth $100,000.00 and your loan amount is $200,000.00 why on earth would you want to end up paying that entire amount?

Push for a loan modification with principal balance reduction

Banks will always try to get you to agree to what suits them better, this is why you have to be a tough negotiator, don’t just agree with the first proposal that they put in front of you. You have to remember that banks also want to come to an agreement. It costs lenders a lot of time and money to take someone through the foreclosure process. The best thing you can do is hire an Orlando real estate attorney that specializes in loan modifications. If you try to go at it alone with your lender, it could end up costing you a lot more money in the long run. Sure, a good Orlando real estate attorney may cost you a couple of grand upfront, but you’ll have a much better chance if you have an experienced negotiator in your corner.

5 things to watch out for when negotiating an Orlando loan modification

1- Your lender has the option of dropping all penalties. Don’t be bullied into a take-it or leave-it trap where they give you the option to pay off the penalties upfront or have them roll the penalties into the balance. You should demand that they wave all penalties as part of the deal.

2- Sometimes lenders will try to get you to agree that if they lose the original loan documents, you must assist the lender in reproducing them. As ridiculous as this may sound, it’s true and you should never agree to something like this. It comes down to the lender having additional legal protection if they screw up. A clause like this has absolutely no benefit to you.

3- Step by step rate increases that are too steep for you to afford or balloon payments that become due before you have time to be prepared for them.

4- Don’t agree to payments that you really can’t afford. When doing a loan modification, the idea is to make the loan affordable to you and your family. Be realistic, don’t put yourself into a position where your budget is soo tight that you’re only one major car repair away from being in default again.

5- Don’t agree to an interest rate that can automatically adjust based on an index over which you have no control.

An Orlando Short Sale may be your best option

As you can see, there are a lot of things that you need to watch out for when entering into a loan modification with your lender. The fact of the matter is that even when you have the bank’s best offer on the table, it still may not be good enough.

You may be much better off doing an Orlando short sale.  At the end of the day, it’s just a house, it’s not part of your family. By doing an Orlando short sale, not only will you be free of your lender forever, but you can get enough cash back to start over and get yourself into a much better situation than you would be agreeing to the terms of a loan modification.

As always, if you have questions about anything to do with Orlando real estate. Call us and set up a free consultation with an Orlando real estate expert.

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Orlando Short Sale Guide part-1 of 2

Posted on by Jenny Zamora

 

What are Orlando Short Sales sales all about?

Working as an Orlando short sale specialist for over eight years, I get questions from both clients and realtors about short sales all of the time; How does a short sale work? Do I have to be behind on my mortgage to do a short sale? How will it affect my credit? Will my lender come after me for  the balance? Can I get money  back even though I’m in foreclosure? What are the tax repercussions?…just to name a few.

This two part post ” Orlando Short Sale Guide” is for people who have unanswered questions about short sales.  This week  I will talk about every aspect of short sales; what they are, how they work and the do’s and don’ts of whole process. In my next post I will also be talking about probably the single most important part of the whole process and that is finding the right Orlando realtor for you.

I think the best way to  start this off,  like anything else is by giving you a clear definition of what a short sale is.  A short sale is a sale of  real estate in which the proceeds from selling the property will fall short of the balance of debts secured by liens against the property and the property owner cannot afford to repay the liens’ full amounts, whereby the lien holders agree to release their lien on the property and accept less than the amount owed on the debt. Any unpaid balance owed to the creditors is known as a deficiency. Short sale agreements do not necessarily release borrowers from their obligations to repay any deficiencies of the loans, unless specifically agreed to between the parties.

An Orlando short sale is most often the best method to Stop Orlando foreclosure because it mitigates additional fees and costs to both the creditor and borrower. While credit is also typically damaged much less than from a foreclosure, both often result in a negative credit report against the property owner.

Who qualifies for an Orlando Short Sale?

Even though someone can easily prove that their house is worth less than what it owes, most lenders require the mortgage holder to be  at least 30 days late on their payment to even consider a short sale. In my opinion, this is a huge flaw  in the short sale process and I believe that any property that is worth less than what it owes should qualify as a short sale candidate. Creditors also require the borrower to prove they have an economic or financial hardship preventing them from being able to pay the deficiency.

  The Short Sale Process

Creditors holding liens against real estate can include primary mortgages, junior lien holders—such as second mortgages, home equity lines of credit lenders, home owners association HOA—all of whom will need to approve individual applications for a short sale, should they be asked to take less than what is owed.

Some liens such as student loans, back child support and I.R.S. liens cannot be discounted and have to be paid in full in order to get the deal closed. In our office, these liens are sometimes referred to as “Deal Killers”.
Most large creditors have special loss mitigation departments that evaluate borrowers’ applications for short sale approval. Often creditors use pre-determined criteria for approving the borrowers and the terms of the sale of the properties. Part of this process typically includes the creditor(s) determining the current market value of the Orlando real estate by obtaining an independent evaluation of the property with an appraisal, a Broker’s Price Opinion or [BPO]. One of the most important aspects for the borrower in this process is putting together a complete  short sale package including hardship letter explaining why a short sale is needed on you Orlando property.

Due to the overwhelming number of defaulting borrowers due to mortgage failures and other causes as part of the 2008–2012 global financial crisis, many creditors have become adept at processing such short sales applications; however, it can still take several months or even a year for the process from start to finish, often requiring multiple levels of approval.

 

Jenny Zamora, Lic RE Broker/ Orlando short sale expert.

 

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Orlando Realtors Getting Creative trying to get New Listings

Posted on by Jenny Zamora

Orlando Real Estate agents are trying anything to lure new sellers and get the listing.

It’s no longer enough just to send out a few thousand post cards and wait for the phone to ring. These days Orlando real estate agents are getting more and more aggressive when it comes to marketing to new sellers. This is not only the case with Orlando realtors, real estate agents across the U.S. are doing their best to lure sellers into giving them the listing.

Some Orlando realtors host happy hours a local bars in hopes of picking up a new listing while others comb through public records to find out who has lived in their home for more than 10 years and may be ready for a change in scenery.  Bank owned properties that were once hitting the market like wildfire are on the decline. In the first quarter of this year, foreclosure filings were at their lowest level since 2007.

Orlando Homeowners are waiting it out

The once plentiful sea of available Orlando Real Estate is drying up fast, but Orlando sellers aren’t budging. Sellers know if they wait out the slow rise in home prices, that they can sell their home for more than it’s worth at present, leaving them closer to the original price they paid or at least closer to what remains on their mortgage. Some homeowners are even hoping to make a nice profit when they sell their Orlando property.

Marketing Orlando Realty Consultants

Here at Orlando Realty Consultants we have just about all the business we can handle from referrals. We get referrals on a daily basis from either past clients that we’ve helped, other realtors that need help with a short sale and even banks that we’ve established good relationships with over the past 7 years.

Like most successful Orlando Brokerages, we started by using traditional methods of marketing for buyers and sellers such as postcards, newspaper ads, etc. but it just got to the point where we just didn’t need to do it anymore. As a matter of fact, the only form of marketing that we do is this blog which is attached to our website, and it was never intended to be about marketing for more clients.  I started writing a blog so that people could easily get valuable information about Orlando Real Estate, which happens to be be one of my passions.

 

Jenny Zamora, Lic Orlando RE Broker. Ask me anything, I’m here to help.

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The days of Low Ball Offers on Orlando Real Estate are Long Gone!

Posted on by Jenny Zamora

Buyers are realizing that they have to Pay the Price if they want a quality Orlando Property

Orlando Homebuyers have had the upper hand since 2006, but today’s reality tells quite a different story, sellers are back in the drivers seat. Prices of Orlando Realty have been rising steadily much like many other parts of Florida and inventory is way down.

The problem with some Potential buyers is that they have trouble accepting the market has changed and they continually miss out on good deals because they bid too low. These days you have to go above the asking price to get taken seriously, and even then you might not get the house you’re after.

Some buyers come into my office thinking that the Orlando Real Estate market is the same as it was in 2008 and 2009 when sellers were desperate to sell their homes. Sellers are no longer desperate and they know that they now have the upper hand. The days of submitting low ball offers are over.

A typical Orlando Seller considers a low ball offer to be anything below 90% of full asking price while on the other hand Buyers feel that offering 80-85% is a reasonable offer.

Orlando Buyers are starting to get the “Big Picture”.

Some people are the type to stick to their guns even if they’re wrong about something, however the majority of Orlando property buyers are starting to realize that if they want to get their hands on a quality piece of Orlando Realty, then they have to pay the price.

 

Jenny Zamora Broker

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Orlando Short Sales Increasing because of Financial Incentives

Posted on by Jenny Zamora

Banks are finally starting to come to the realization that it’s much cheaper to pay off delinquent borrowers as an incentive to short sale their Orlando house than it is to take them through the foreclosure process. I think it’s about time they saw the bigger picture.

Bank of America as well as a few others are currently testing incentives from $5,000-$25,000 here in Florida to see if they should be expanded to more states.  JP Morgan Chase went national with incentives of up to $35,000, and Wells Fargo’s incentive ranges from $3,000-$20,000. If that’s not incentive then I don’t know what is.

These incentives are saving lenders big money compared with the expenses involved in completing a foreclosure. In Florida, where foreclosures go thru the courts, 50% of loans in foreclosure are more than two years past due. No one knows how long they will keep offering these incentives or what determines which sellers will qualify.  You can have two similar sellers, and one might receive the incentive and the other may not receive it.

One thing is for sure though, if you’re looking to do an Orlando short sale, right now is the best time to short sale your house. Never before in history have banks ever been so cooperative and generous to borrowers who have fallen behind on their mortgage.

Here’s more good news… You don’t have to pay the mortgage while the short sale process is happening.  That’s right you stay in the house for free until the short sale is complete.

If you’re considering an Orlando Short Sale on your house,  contact us for a free consultation with one of our short sale specialists and find out exactly where you stand. You’ll be glad you did.

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