Short Selling Investment Properties

Santa Clarita Valley CA – I recently received a question from Phil. Here is Phil's Question.

"I am a California Resident but have 3 distressed Florida Properties pending foreclosure. Under Florida law a creditor cannot garnish wages. Will investor pursue deficiency? If yes, will they follow FL or CA law? Thanks, Phil.”

Here was our answer. That is a legal question. Since I am not a lawyer I cannot answer it.

I do know that you can usually short sale in Florida and get the lender to forgive you of the debt. However, there are other things you can do to avoid the deficiency problem.

First, work hard to convince your lender to waive the deficiency. Investment Property Short Sales are tougher because the lenders are more reluctant to waive the deficiency.

But, many lenders will waive it. Others will agree to waive it when you have presented financial statements that show you cannot afford the deficiency.

So I think that over half of the deficiencies will be waived by the lenders. Here is what you can do for the remaining ones. First, depend on incompetence on the lender’s part.

Most lenders don’t have enough staff to handle their delinquent debt. Even if they do have the right to a deficiency in most cases the only thing they will do is call you.

When they call, you simply tell them that you don’t have the money in your budget that month to pay them anything. Don’t say anything more than that and don’t lie to them.

(A lie can get you in legal trouble later on. You are better saying very little and hanging up the phone than lying.)

Most lenders won’t do anymore than “sick” the debt collectors on you. They hardly ever go to court or attempt to garnish your wages. E-mail me for a simple letter that will legally stop the harassing phone calls.

In my opinion, this will enable you to short sale 90% to 95% of all investment properties and avoid paying a deficiency. Here is what you should do if you fall into the unlucky 5-10%.

Hire a good lawyer. They can usually find a hole in their court case and get you out of paying the debt. These lenders are so disorganized that the often do not have all their paperwork in order.

Or, they can find a situation where the lender broke Collection Law. In that case, the lender is usually more than happy to settle with you versus facing a lawsuit.

Thinking about a short sale? I can help you short sale your property and never pay the bank another penny. Send me an e-mail at cliff@cliffhildreth.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (661) 904-1194

Remember, as I stated above, I am not a lawyer so I can't answer legal questions with authority. This is my reasoned opinion based on years of dealing with lenders in the short sale process. You should always consult an attorney before making important real estate decisions.

Thanks for reading this, Cliff Hildreth.

Cliff is a Real Estate Agent at Realty World Estates. Santa Clarita Valley Short Sales Realtor:

Phone: (661) 904-1194. cliff@cliffhildreth.com.

Check out our youtube channel for some great informative videos: http://www.youtube.com/rwvalencia

"Together We Can Make It Happen"

The "Guaranteed Sale Or I'll Buy It" Scam

Is this another real estate marketing gimmick or is this for real?

Unfortunately it’s for real and used by many agents all across the country. I can safely say this is a gimmick where I strongly suggest you don't participate!

Why not? Because the Internet is littered with horror stories where this scheme has gone astray to the determent of all involved and frankly the risk to both you and the agent far outweighs any real benefit to either of you. I am personally aware of several agents in my area that use this gimmick and have several listings that are over the time limit they guarantee (and, by the way, they don't own the homes.)

A Look at the Fine Print
To any observant reader a title or graphic promoting this type of offer is easily recognized as a marketing ‘teaser’. While perfectly ethical in an attempt to grab the readers attention, the real story is in the restrictive small print that inevitably follows.

The worst possible implementation of this offer on the Internet, is one where there is no fine print at all, only a lead generation contact form. This practice is far too widespread in my view, and I wish there were local regulations that required details to accompany offers such as this, even if only in small print.

Remember the old adage, ‘If it looks to good to be true, it probably is‘. Most often this is a perfect description of the ultimate result of this offer. Some of the restrictions accompanying this offer include one or more of the following:

- An agreed upon listing price and time-limit
- Home is not purchased by agent until listing expires
- Purchase price to be paid by agent is frequently 80%, or less, of appraisal value or some other extremely low amount. (By the way, who wouldn't buy a home that they could turn around and sell for a 20% profit? The profit that you should have had.)
- The home is under a certain price threshold and not a foreclosure
- Etc., Etc.

Too Good to be True?

The fine print detail, which most often renders this offer immediately ‘too good to be true‘ is the purchase price the agent is willing to pay for your home in the event it does not sell within the agreed upon time-frame. I call it "The Vulture Clause".

The percentage of appraisal mentioned above is a biggie! If you are like me, I wouldn’t want to sell my home at a large percentage off of comparative-market-value much less of the appraised value. If you are like most people, you want the best price you can get in the marketplace. Even if the agent buys it (and I, so far, haven't seen one do it), it's a built-in windfall for him/her, not you!

Another thing to keep in mind is the current market. In this economy many homes are now worth less than the seller owes. In that event they must do what is called a "Short Sale" where the lender allows the homeowner to sell the home for less than they owe. They still, however, want as close to current market value as they can get. They won't just give away the home! An agent offering substantially less than the market value will, almost certainly, be turned down by the lender anyway. They can still say they "tried" to buy it so it isn't their fault even though they knew (or should have known) it would fail before they made the offer.

One horror story described a law suite where the offering agent cancelled the listing contract thereby not letting it expire, and thus by the letter of the contract were not obligated to purchase the home.

My sincere recommendation to any consumer considering entering such a listing contract is have your Attorney look over the contract for potential loopholes that could possibly be utilized to invalidate it by either party without consent of the other. Also, ask for a list of the agent's current listings. See how many are over the time limit the agent says is the point he will buy the home. Those over the limit, ask the agent why he doesn't own them. Many agents depend on your not wanting to go thrugh the process and delay of changing agents after the home has been on the market and they don't make the purchase.

Remember, this is probably the biggest transaction you will have in your life at this time. If your finances, credit and sanity depend on getting this done smoothly, be aware. Trust is a vital part of an agent's value. If an agent isn't honest about this, what else is he/she not going to be honest about?

This gimmick and listing deal is easy to pass on so, BE CAREFUL! It's ultimately up to you but, unless you are satisfied with the price and other details, PASS!!

New Scam Alert From HUD

I normally don't act as a news organization but scams are happening way too often with distressed homeowners looking desperatley for help. It's too easy for unethical people to prey on others in need of help. Take a look. It may save your home.


RISMEDIA, April 20, 2011—The U.S. Department of Housing and Urban Development (HUD) is launching a new campaign in Miami, Chicago and Los Angeles called Know It. Avoid It. Report It. This campaign has two objectives. First, it aims to direct homeowners facing foreclosure to trusted resources and housing counselors. Second, and more importantly, the campaign wants to solicit the support of homeowners in shutting down scammers who regularly target the elderly, Hispanics and African Americans. Both objectives will be pursued through education and outreach, anti-scam reporting tools and close cooperation with federal, state, local and non-profit partners.

Newly deceptive scam artist tactics lure homeowners into misleading agreements. Their tactics include giving the false impression that they are affiliated with the government, charging illegal up-front fees and executing fraudulent lease-back, financing and repurchase schemes.

Highlights of the Know It. Avoid It. Report It. campaign include:

-Information on how to avoid becoming a victim

-Scam artist red flags and fraud warning signs

-Complaint form and hotline to report fraud or suspicious activity

-Resources for finding HUD-approved counselors and free housing workshops in every state

-Names of individuals and companies identified by law enforcement agencies who have allegedly committed loan modification fraud or foreclosure relief scams

Education, outreach and grassroots efforts in hardest hit communities include:

-Multilingual brochures, posters, flyers and other outreach materials

-Television, radio, print, mass transit and out-of-home advertising

-Social media activity

With millions of homeowners in foreclosure or at risk of losing their homes as they fall behind on mortgage payments, and eight million Americans expected to face foreclosure now through 2012, the timing of this campaign could not be more prudent.

HUD’s goal is to motivate homeowners to call 1-888-995-HOPE (4763) or visit www.hud.gov/preventloanscams to get the facts about fraud and to report suspected scammers.

For more information, visit www.hud.gov.

Lender Lawsuit Scam Alert!

I have been seeing this issue for a while and now some very important information is coming to light that I thought you may want to know.
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Ever since the Loan Modification scams were uncovered in the last year or two crooks have been busy trying to find yet another way to defraud homeowners who are having trouble with paying their mortgage. They know that people are desperate to hang on to their homes are easy prey and will grasp at anything that even sounds plausible to save their most precious investment.
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The new scam is 'Suing the Bank For Title". It capitalizes on the news we have been hearing lately of the paperwork issues with banks foreclosing on homeowners without doing the necessary paperwork first. An attorney (or maybe not) may be calling or sending very official looking information that they are going to go after the evil bank for making some clerical errors in your mortgage that will allow them to sue for clear title to your home. That means not just getting a modification or reduction in your mortgage, but owning your home outright with no more payments!
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Sounds great doesn't it?
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The only problem is that they need thousands, if not tens of thousands, of dollars up front to get the lawsuit going. They will tell you that they have a 100% track record of success (or something close) because the bank would rather just give up your home and lose a few hundred thousand dollars rather than fight a lawsuit that may cost them millions to defend. Makes sense again, right? It would if it were true. Banks don't just give a way home because of legal threats! If they did everyone would be filing lawsuits and owning their homes for free.The old adage still applies - "If it sounds too good to be true - it probably isn't!"
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These companies are raking in millions and not getting people their homes for free. As a matter of fact, they are getting some of their "Clients" foreclosed because they tell them to stop paying their mortgage while the lawsuit is in progress. NOT SMART! Another scam is that the firm will tell homeowners that they will retain a partial ownership in the home as their fee only to ask for thousands for "Court Costs" after the homeowner signs the retainer.
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Look, I'm not saying every attorney in this is a crook. Some legitimate lawsuits are in progress and may work out to the benefit of the homeowner ultimately. I'm just saying you need to do your homework if you are going to entertain this path. Lawsuits take years, not weeks or months, and, as with any lawsuit, YOU CAN LOSE! If you signed your loan voluntarily and it contains information about the term, interest rate and any possible adjustments, you probably cannot just walk away because it is hard to pay. Nobody can guarantee success in a civil lawsuit before it begins!
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You may be better off trying to get a modification yourself (it's free that way). It's hit or miss but at least it won't cost you anything but your time. I can help with information on how to negotiate it if you want to give it a try. If that doesn't work and you can't maintain the payments you may want to just get out from under it and short sale. That usually costs you nothing and can save your credit from a foreclosure bomb. If you have any questions, I'm here to answer them with no obligations. Give me a call before you make a serious mistake you may regret for years to come.
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I can be reached at (888) 835-4663 or email me at cliff@cliffhildreth.com
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Be careful out there. Have a great day.

Check out my website for great home info: http://www.cliffhildreth.com

Why Should I Pay Double For My Home?

Santa Clarita Valley CA – The Stop Foreclosure Institute recently received a question from Luis. Here is Luis's Question.

"I am working on a loan modification on my home. I just don’t want to be upside down and want a fair interest rate. Why should I pay on a mortgage that is twice as much as my home is worth, plus the interest on that mortgage? It just doesn’t make sense.

How can I get a loan mod with a fair interest rate where I am repaying what my home is worth today? Thank for your help, Luis.”

Here was our answer. You are asking for something that most lenders don’t like to do. Lenders don’t like principal reductions. Here is why.

Principal reductions usually have to be written down right away on their financial books. If you owe them $300,000 and they reduce your loan principal to $150,000, then they immediately have to reduce the company’s earnings by $150,000 for the year.

If they do that on enough loans, then it hurts the CEO’s ability to get a bonus. He may even risk losing his job. I don’t offer much sympathy to CEOs, but that’s how it works.

Here is what lenders like to do instead. They will reduce your interest rate to 2% for 5 years. After that, the interest rate will go back to the original level.

That way the write off will be much smaller than $150,000. It might be a $30,000 write off. That makes a much smaller difference on the CEO’s bonus for the year.

It’s also one of the reasons that most loan mod programs don’t work. The banks aren’t willing to be realistic.

It’s also why I think a short sale is the best principal reduction plan. You get to erase the bad debt. Rent a home for 2-3 years and then buy a new one at today’s market level.

That way you guarantee your principal reduction and don’t waste time arguing for a principal reduction with someone who isn’t allowed to give it to you. Thinking about a short sale?

I can help you short sale your property and never pay the bank another penny. Send me an e-mail at cliff@cliffhildreth.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (661) 904-1194

Thanks for reading this, Cliff Hildreth.

Cliff is a Real Estate Agent at Realty World Estates. Santa Clarita Valley Short Sales Realtor:

Phone: (661) 904-1194. cliff@cliffhildreth.com.

"Together We Can Make It Happen"

View My homes for sale at
www.cliffhildreth.com.

Cliff Hildreth specializes in loan modification assistance and short sales in Santa Clarita Valley California. Santa Clarita Valley Loan Modification Help, Santa Clarita Valley Short Sales. Santa Clarita Valley Short Sale Realtor. , Short Sale Realtor. Santa Clarita Valley CA Short Sales. Santa Clarita Valley Realtor.

Copyright 2011 Cliff Hildreth. All Rights Reserved. This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing. The views expressed here are Cliff Hildreth's personal views and do not reflect the views of Realty World Estates.

Another tip to improve the odds of your short sale offer being approved

Santa Clarita Valley CA – If you are selling your home, then ask the buyer to write a letter about why they want to purchase the home. If you are a buyer, then write that letter.

Discover how other sellers successfully did a short sale to avoid foreclosure by clicking here.

The listing agent will submit that letter along with the short sale paperwork. With a little luck that letter will help “grease the wheels” and cause the short sale to be approved faster.

Short Sale negotiators are human beings. They have emotions that can be touched by a good story.

These letters might sound like a joke, but they can make a huge difference. I’ve even seen home owners lose money on their sale because the liked a certain buyer over another one.

In that case, the seller sold their home for several thousand dollars less to a buyer that they liked. The other buyer had been rude and the seller didn’t like them.

If that made a difference when the seller was losing their own money, then think about the difference it will make to a short sale negotiator who isn’t losing their own money.

Put a good story in your letter. Here are a few examples.

You might say something like this: “We are a first time home buyer looking for our first home. We just want to move out of our cramped apartment and are looking forward to our first home where we can plant a garden.”

Or, maybe it would be like this: “We have looked for a while and finally found this home on Elm Street that we love. We are selling our current home so we can buy a house with a yard.

Our two boys, Tim and Julian, have been begging us for a swing set. We never had room in our old condo.

If you approve our short sale offer, then we will finally be able to give them the large, fenced backyard they’ve always wanted with a swing set.

We’ve already picked out the swing set plan and Tim and Julian are so excited about it. So, don’t approve the short sale offer for us, approve it for them.”

See how I’m pulling the negotiator’s heartstrings. Unless your short sale negotiator is absolutely heartless, it will make a difference for you. Thinking about a short sale?

I can help you short sale your property and never pay the bank another penny. Send me an e-mail at cliff@cliffhildreth.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (661) 904-1194

Thinking about a loan modification? Our Santa Clarita Valley loan modification kit has the instructions you will need to get a loan modification approved with your bank.Call for a free copy.Thanks for reading this, Cliff Hildreth.

Cliff is an agent and the owner of Realty World Estates in Valencia, Ca. Santa Clarita Valley Short Sales Realtor:

Phone: (661) 904-1194. cliff@cliffhildreth.com.

"Together We Can Make It Happen"

View My homes for sale at www.cliffhildreth.com.

Cliff Hildreth specializes in loan modification assistance and short sales in Santa Clarita Valley California. Santa Clarita Valley Loan Modification Help, Santa Clarita Valley Short Sales. Santa Clarita Valley Short Sale Realtor. , Short Sale Realtor. Santa Clarita Valley CA Short Sales. Santa Clarita Valley Realtor.

Copyright 2011 Cliff Hildreth. All Rights Reserved. This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing. The views expressed here are Cliff Hildreth's personal views and do not reflect the views of Realty World Estates in Valencia, Ca.

This information on Another tip to improve the odds of your short sale offer being approved is provided as a courtesy to our viewers to help them make informed decisions.

I Short Sale If I Have Substantial Assets & Good Income?

Feb 17, 2011 - I recently received a question from Dave. Here is Dave's Question.

"I bought several investment properties at the peak of the market. The homes have dropped in value by almost 40% and I am losing money on the rent every month.

I am sick of writing a check every single month to cover the loss. I would like to short sale these properties if possible. I am just wondering if the banks would allow it. What do you think?” asked Dave.

Here was our answer. Dave, there is no answer that is correct 100% of the time. In your situation, it depends on your lender. Many lenders will allow a short sale.

Others won’t talk to you until you are behind on the payments. I have a friend who is in a situation very similar to yours and is short selling several properties.

He has substantial assets and a good income. Some of the banks were easy to work with. He was able to stay current on the payments until they approved the short sale.

However, some of the other banks weren’t as easy to work with. He had to stop making payments before they would talk to him.

It all depends on the bank and how much you want to short sale. I know several people that write big checks every month just trying to stay afloat on their rental properties.

If you aren’t planning on buying another house for 2-3 years, and want to stop the bleeding, then a short sale is a great option.

If I were you, then I would attempt a short sale. It doesn’t cost you any money. I don’t see how you can lose. If they don’t approve the short sale, then you are exactly where you are at today.

Thinking about a short sale? I can help you short sale your property and never pay the bank another penny. Send me an e-mail at cliff@cliffhildreth.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (661) 904-1194

Discover how other sellers successfully completed a short sale and request a free consultation by clicking here.

Thinking about a loan modification? Our Santa Clarita Valley loan modification kit has the instructions you will need to get a loan modification approved with your bank. Call or email to request a free copy. Thanks for reading this, Cliff Hildreth.

Cliff is a Real Estate Agent at Keller Williams VIP Properties. Santa Clarita Valley Short Sales Realtor:

Phone: (661) 904-1194. cliff@cliffhildreth.com.

"Together We Can Make It Happen"

View My homes for sale at
www.cliffhildreth.com.

Cliff Hildreth specializes in loan modification assistance and short sales in Santa Clarita Valley California. Santa Clarita Valley Loan Modification Help, Santa Clarita Valley Short Sales. Santa Clarita Valley Short Sale Realtor.
Short Sale Realtor. Santa Clarita Valley CA Short Sales. Santa Clarita Valley Realtor.

Copyright 2011 Cliff Hildreth. All Rights Reserved. This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing. The views expressed here are Cliff Hildreth's personal views and do not reflect the views of Keller Williams VIP Properties.

This information on Santa Clarita Valley Short Sales: Can I Short Sale If I Have Substantial Assets & Good Income? is provided as a courtesy to our viewers to help them make informed decisions.

Bank of America forecloses on paid off house

Santa Clarita Valley CA - According to a story in the Sun Sentinel [1], Bank of America foreclosed on a paid off house. Here is an excerpt from the story.

" When Jason Grodensky bought his modest Fort Lauderdale home in December, he paid cash. But seven months later, he was surprised to learn that Bank of America had foreclosed on the house, even though Grodensky did not have a mortgage.

Grodensky knew nothing about the foreclosure until July, when he learned that the title to his home had been transferred to a government-backed lender. "I feel like I'm hanging in the wind and I'm scared to death," said Grodensky. "How did some attorney put through a foreclosure illegally?"

Court records show Countrywide Home Loans filed a foreclosure case in Broward County civil court against the former owner of the home on Southwest 14th Street in 2008. Bank of America took over Countrywide at the end of that year.

The following year, Grodensky and his father Steven bought the house for cash as an investment property. Jason Grodensky's brother Kenny Sloan lives in the house now. They negotiated a short sale, which means the lender agreed to accept less than the mortgage amount. Documents show the sale proceeds were wired to Bank of America. The sale was recorded in December 2009 at the Broward County Property Appraiser's Office.

But in court, the foreclosure case continued, the records show. There was a motion to dismiss the case in July, followed the next day by a motion to re-open it. A court-ordered foreclosure sale took place July 15. The property appraiser's office recorded the transfer of the title to Fannie Mae the same day."

As you can see, Bank of America is very disorganized. Many agents claim they are the worst lender to do short sales with. Make sure you hire an experienced short sale agent if you plan on short selling your house and your loan is with Bank of America.

Short sales happen with them every day. But, their short sales are more difficult and usually take more time.

If you have questions about the short sale process, then please send me an e-mail at cliff@cliffhildreth.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail. If you prefer, then you can call me at (661) 904-1194.

Thinking about a loan modification? Our Santa Clarita Valley Loan Modification Kit has the instructions you will need to get a loan modification approved with your lender. Email me at: cliff@cliffhildreth.com. I will be happy to forward you our kit free of charge.

Thanks for reading this, Cliff Hildreth.

Cliff is a Real Estate Agent at Keller Williams VIP Properties.

Phone: (661) 904-1194. cliff@cliffhildreth.com.

"Together We Can Make It Happen"

View My homes for sale at www.cliffhildreth.com.

Cliff Hildreth specializes in loan modification assistance and short sales in Santa Clarita Valley California. Santa Clarita Valley Loan Modification Help, Santa Clarita Valley Short Sales. Santa Clarita Valley Short Sale Realtor. Short Sale Realtor. Santa Clarita Valley CA Short Sales. Santa Clarita Valley Realtor.

Copyright 2010. All Rights Reserved. This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing. The views expressed here are Hildreth's personal views and do not reflect the views of Keller Williams VIP Properties. This information on will my neighbors find out that I am short selling my house is provided as a courtesy to our viewers to help them make informed decisions.