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Why Does A Short Sale Take So Long?

Contrary to what the name implies, a short sale is usually a very lengthy process. A short sale is the sale of a home for less than the amount owed on the mortgage, and the lender agrees to give clear title to the new buyer. This means that the lender is forgiving the additional debt owed by the borrower and releasing their lien on the property. A short sale is generally less damaging to the sellerís credit than a foreclosure, but it will still have a negative effect on your credit score. If you own a home thatís market value is less than your mortgage balance and you are having difficulty making your mortgage payments, a short sale maybe the answer. The first thing you need to do is contact your lender. Since the housing crisis of 2006, most banks now have loss mitigation or short sale departments. You will need to fill out a short sale packet which your lender can send you. As part of that package, you will need to write a ìhardship letterî explaining why you are unable to make your mortgage payments and that the situation is unlikely to improve in the future. This is the most important step in obtaining short sale approval because the lender needs to believe that you are unable to meet your financial obligation to repay the loan. You will also need to provide financial records showing proof of income and assets to demonstrate that you do not have the ability to repay the loan. They will also want a preliminary net sheet that shows the sale price you...

Which Home Improvements Really Pay Off?

If you are thinking about tackling a home improvement project this summer, you might be wondering which up-dates will give you the highest return on your investment. Contrary to what you may see on HGTV, you can generally recoup the most value on projects that improve your curb appeal. Remodeling your kitchen and adding granite countertops and stainless steel appliances can improve the salability of your home but the percentage of return on your investment is relatively low. According to Remodeling Magazines 2014 Cost vs. Value report the best return on your investment dollars is replacing your front door. Installing a steel entry door with a glass panel and new hardware can yield up to a 96% return on your investment. Other projects that increase your curb appeal and have a high return on investment include adding a deck, replacing windows and siding and installing a new garage door. At the bottom of the list for projects that have the least return on your investment are roof replacements and back up generators. Obviously, if your home needs a new roof you will have to replace it but buyers look at this as a maintenance issue and you only recoup a small percentage of your expense when it comes time to sell. Similarly, a generator can provide necessary piece of mind for the owners, but most buyers do not consider this to add significant value to the price of a home. Somewhere in the middle are interior improvements such as kitchen and bathroom remodels. Both generally yield about a 67% return on your investment. Kitchens and bathrooms sell homes so...

What to Expect at a Real Estate Closing

The final step in a real estate transaction is called the closing. When you are buying a house, this is when all the papers are signed and the ownership transfers into your name. If all goes well, you walk out with the keys to your new home! If you have never purchased property before, the closing process can seem a little intimidating. If it has been awhile since you bought property, a lot has changed. After all the contingencies have been met ( all inspections completed satisfactorily, the appraisal completed and your financing has been approved) you are ready to schedule your closing. Your closing will be scheduled on or before the closing date you agreed to in your contract. Until that time, the seller still owns and will probably retain possession of the property. Keep in mind that you are usually unable to move anything into the house until after the closing. When you are preparing for your move, make sure you have scheduled movers for sometime on after the closing date. Besides scheduling the movers, you will also need to have all utilities put in your name. This includes gas, electric, water & sewer, cable, phone and internet, if you wish to have them. Usually, you need to have all the utilities put in your name as of the date of closing. Make sure you allow enough time for the transfer to occur- at least a week before you should have this done. Also, some companies may require a deposit if you have never had service in your name. You will also need to have homeowners insurance...

How to Make a Winning Offer

Once you have found the house you want, you need to make a written offer to buy it. There are many things to consider before you write the offer. You will need your pre-approval from your lender, an earnest money check( an amount of money you put down when making an offer to demonstrate your good faith, usually $1000 or more based on the price of the home) and a written offer to purchase that you will complete with the help of your Realtor. Obviously, the price you wish to offer is an important consideration but there are many other factors that may affect whether or not your offer is accepted. These other factors are called contingencies and they may sometimes be as important to the success of your offer as the price. If you are obtaining a mortgage to purchase the property then your Realtor will want to include a financing contingency. The bank will normally also require an appraisal of the property to be completed and therefore you will also need an appraisal contingency. If you are paying cash, you will need to decide if you wish to have an appraisal done, since it is not required. In the financing contingency, you will need to include the type of mortgage you are obtaining( conventional, FHA, VA, etc.) and the date by which you will be providing the seller with your final loan approval (typically 30 days or so). If you have already been pre-approved, the bank should have all the required documentation from you and will just need a copy of the final purchase contract and the...

The House Hunt

In my last column I discussed the first step in the home buying process: getting pre-approved with a lender. Once you have been pre-approved you will know what price range to focus your home search in and what type of loan you have been approved for. If you are getting a government backed loan product(FHA, VA or USDA Rural Development to name a few) your home search should be focused on properties that meet the criteria for that type of loan. Typically, foreclosure properties will not meet the standards that these loans require their properties to meet, so keep that in mind when doing your home search. Your lender can tell you what types of issues you need to stay away from but typically they are health & safety concerns. Peeling paint, broken windows, mold, un-safe wiring and in-operative furnaces are some examples of items that would affect your ability to obtain a mortgage on that property. Now that you have been pre-approved for a loan and know your price range, where do you start to find a home? According to the National Association of Realtors 90% of todayís homebuyers start their home search on the internet. With the popularity of such real estate websites as Realtor.com, Trulia and Zillow, home buyers can search a specific price range and location and immediately see what is available for sale from the comfort of their living room. These websites are useful tools for getting a market overview and a feel for what is available in your price range, but they are no substitute for touring a home in person. Before you...

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