Short sales come in one of two forms and are typically encountered when a homeowner is behind in their mortgage and have been sent a notice from the bank that the home is being foreclosed on and that a date has been set for the public auction of the house.

As the threat of foreclosure looms over the homeowner a short sales gives them a quick way out of their financial downfall. However, the owner does need to negotiate with the bank on what amount the bank will accept for the house to forgive the remainder of the debt.

Usually the negotiation process is simple and short, thus the terminology, a short sale. However, if a homeowner owes more that the value of the home due to overspending or refinancing to pull equity out of the house the bank may take up to six months to negotiate the sale of the home.

The good news for the owner that is selling the property is that they still occupy the home without any additional penalty while the negotiations are being sorted out. For a patient buyer a short sale can save money on the purchase of a home as the sales price is usually below market value for the property.

The other type of short sale works in much the same way except as the first short sale, except that instead of the home owner setting the price and negotiating with the bank, the bank has already taken possession of the house and gone through the foreclosure process, evicting the delinquent tenants along the way. The bank then sets an approved price for the house that they will accept.

Bank approved short sales move quickly as all of the negotiation is already done and the bank need only accept serious offers for the vacant home. Bank approved short sales are rarely on the market for a day or two as eager buyers are ready to move on these properties and have pre-qualification letters to support their offers.

The real difference in a short sales and a regular sale of a home is that the short sales specifies that a house is in as is condition and no work will be done by the seller to bring the house up to regular selling standards. In some cases houses that are vacant may need to be cleaned or have minor repair work done to them to make them livable for the buyer. In either case of a short sale the buyer is assured to get a good deal on the home even with any repair work that may be required.

About the Author

Re/Max New Jersey (http://www.remax-nj.com) is one of the top real estate companies of New Jersey homes for sale. Art Gib is a freelance writer.

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The HomeSales.gov web site provides current information about single family homes for sale by the U.S. Federal Government. These previously owned homes are for sale by public auction or other method depending on the property. Anyone can buy a home for sale by the U.S. Government, but you must work with a real estate agent, broker or servicing representative to submit an offer or bid.

The website has an easy to use interface where you can click the state of interest on a US map, then indicate the city or town you are interested in. A listing of all available homes is shown. Many of the properties have detailed information including pictures, a property condition report, and contact information for more details.

Since many of the homes are offered through auction, the bid the bid price and bidding information is presented as well. The listing indicated which agency is selling the property, and the appropriate manner in which to place a bid or offer on the property.

Housing Counseling

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Housing counseling is strongly encouraged for anyone interested in buying a home for sale by the U.S. Government, particularly first-time homebuyers. There are a number of housing counseling agencies approved by the Department of Housing and Urban Development (HUD). HUD supports a network of approved housing counseling agencies that provide counseling services across the nation. you can contact your local HUD office for a complete list of HUD approved agencies in your area. More information is available on the HUD Website.

How to Buy U. S. Government-Owned Homes

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Once you find the property you are interested in making and offer on, you need to follow the proper procedure in order to complete the offer process. This usually involves contacting a HUD approved real estate agent or broker. You can find a complete listing of approved agents on the HUD website. The program requirements and process will differ depending on which agency is selling the property. The listing will indicate the process required for each property.

There are a number of government programs that assist buyers in purchasing surplus government homes. They are:

1. The U.S. Departments of Housing and Urban Development (HUD)
2. Agriculture (USDA/Rural Development)
3. Veterans Affairs (VA)

HUD Homes

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After you find a HUD Home on homesales.gov that you want to buy, you should find a real estate broker who can submit the bid for you. The broker can submit the bid online. Normally, HUD Homes are sold in an “Offer Period”. At the end of the Offer Period, all offers are opened and the highest reasonable bid is accepted. If the home isn’t sold in the initial Offer Period, you can submit a bid until the home is sold. Bids can be submitted any day of the week, including weekends and holidays. They will be opened the next business day. If your bid is acceptable to HUD, your real estate agent will be notified, usually within 48 hours.

USDA/Rural Development Homes

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After you find a USDA/Rural Development home on homesales.gov that you want to buy, you should contact the local USDA/Rural Development servicing office, which will provide the most current and accurate information regarding the status of the home as well as your eligibility for potential program benefits. You can find the local servicing office contact information on the home’s description web page. Depending on your circumstances and the status of the property listed, your method of bidding and ultimately purchasing the property may vary.

VA Homes

After you find a VA Home on homesales.gov that you want to buy you should have a real estate agent or the selling agent prepare the Offer to Purchase And Contract of Sale VA form, and complete all necessary documentation. Your agent will submit your offer through the listing broker for approval. The listing broker’s name and telephone number are found at the beginning of each listing.

References

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Homesales.gov website:  http://homesales.gov/homesales/mainAction.do

HUD housing counseling referral line (toll-free) 1-800-569-4287

HUD website:  http://www.hud.gov/offices/hsg/sfh/hcc/hcc_home.cfm

Additional HUD Homes Information: http://www.hud.gov/offices/hsg/sfh/reo/reobuyfaq.cfm

USDA/Rural Development Homes: http://properties.sc.egov.usda.gov/sfhdirect/SFHPropMain.cfm

Forms and information on VA homes: http://www.ocwen.com/reo/residential/res_reofindbystate.cfm?proptype=VA

Click Map To Search Foreclosures

From owning rental properties, to fixing up properties in disrepair, to foreclosure investing, real estate is a bright light in the current gloom of the overall economy. Sure, people are out there losing homes and we wouldn’t wish that upon anyone. That said, these situations create opportunities for investors and also a chance to help someone who needs a solution to their problems.

With respect to foreclosure investing, where do most people turn when they seek opportunities? They might take a look at foreclosure listings that come from either realtors or other private sources. They can then use these sources of leads to market to pre-foreclosures, one of the most common forms of foreclosure investing that includes short sales.

Another option with foreclosure investing is the world of bank owned real estate. When a property is lost via foreclosure it goes back to the bank and then becomes one of the now thousands of bank owned foreclosures (or REO properties) on the market today. Once on the market, you can work with a realtor who specializes in bank owned properties and start making offers almost immediately. Who said that foreclosure investing had to be tough to get into?

The key is to surround yourself with a professional team who can collectively support your efforts in foreclosure investing. With the abundance of pre-foreclosures and bank owned foreclosures out there, more and more professionals like realtors and attorneys are working with investors who specialize in foreclosure investing. In addition to guidance, these professionals can also provide you with foreclosure listings for your business.

Despite the opportunities that exist with foreclosure investing, I think foreclosure investing also can be risky for the investor because, without the proper foreclosure training, you run the risk of not really knowing what you are doing. Profits can be lost and so too can opportunities that exist with foreclosure investing when you lack the proper foreclosure investing training.

In today’s economy and market, foreclosure investing is as much as part of the real estate business as anything else. Make sure you have the tools you need ready to go for foreclosure investing because the deals are out there waiting to be discovered and profited from. I also suggest that you commit yourself to real estate training, and your pursuit of foreclosure investing will be more productive and more rewarding.

I cannot count how many times it has benefited me in the past. When you know what you are doing, deals go much smoother and faster then when you are stumbling around trying to figure out what to do. I wish you the very best in success not only in all of your foreclosure investing pursuits but also in your complete business as a whole.

DISCLAIMER: All information, content, and data in this article are sole opinions and/or findings of the individual author.. The article is strictly for educational or entertainment purposes only and should not be used in any way, implemented or applied without consultation from a professional. We at realty-info.org do not, in anyway, contribute or include our own findings, facts and opinions in any articles presented in this site. Publishing this article does not constitute realty-info.org’s support or sponsorship for this article.

About the Author:

D.C. Fawcett learned the real estate business from the ground up and now operates a world class investing business out of the Tampa, FL market. His training programs specialize in showing real estate investors how to create success in the real estate foreclosure market and have gained broad appeal around the USA. You can learn more about D.C. Fawcett’s programs by clicking here.

U.S. Foreclosure Activity Up Nearly 18 Percent from May 2008

Total Exceeds 300,000 for Third Straight Month
IRVINE, Calif. – June 11,    2009 – RealtyTrac®  (www.realtytrac.com),    the leading online marketplace for foreclosure properties, today released    its May 2009 U.S. Foreclosure Market Report™, which shows foreclosure    filings —  default notices, scheduled auctions and bank repossessions — were  reported on 321,480 U.S. properties during the month, a decrease of 6 percent    from the previous month but an increase of nearly 18 percent from May 2008.    The report also shows that one in every 398 U.S. housing units received a    foreclosure filing in May.

“May foreclosure activity was the third highest month on record, and  marked the third straight month where the total number of properties with foreclosure  filings exceeded 300,000 — a first in the history of our report,” said  James J. Saccacio, chief executive officer of RealtyTrac. “While defaults  and scheduled foreclosure auctions were both down from the previous month,  bank repossessions, or REOs, were up 2 percent thanks largely to substantial  increases in several states, including Michigan, Arizona, Washington, Nevada,  Oregon and New York. We expect REO activity to spike in the coming months as  foreclosure delays and moratoria implemented by various state laws come to  an end.”

Nevada, California, Florida post top state foreclosure rates

Nevada continued to document the nation’s highest foreclosure rate, with  one in every 64 housing units receiving a foreclosure filing during the month — more  than six times the national average.

With one in every 144 housing units receiving a foreclosure filing during  the month, California posted the nation’s second highest state foreclosure  rate despite a 4 percent decrease in foreclosure activity from the previous  month.

Florida posted the third highest state foreclosure rate in May, with one in  every 148 housing units receiving a foreclosure filing during the month.

Arizona posted the fourth highest state foreclosure rate in May, with one  in every 158 housing units receiving a foreclosure filing, and Utah posted  the fifth highest state foreclosure rate, with one in every 316 housing units  receiving a foreclosure filing.

Other states with foreclosure rates ranking among the nation’s 10 highest  were Michigan, Georgia, Colorado, Idaho and Ohio.

Top 10 states account for nearly 77 percent of total U.S. foreclosure    activity

California reported 92,249 properties with foreclosure filings in May, the  highest total of any state and up nearly 23 percent from May 2008. Bank repossessions  in California were down 1 percent from the previous month and defaults were  down 18 percent, but scheduled auctions were up 18 percent.

Default notices, scheduled auctions and bank repossessions in Florida were  all down from the previous month, but the state still posted the nation’s  second highest number of properties with foreclosure filings: 58,931, up 50  percent from May 2008.

Nevada documented 17,157 properties with foreclosure filings in May, the third  highest total of any state and up nearly 83 percent from May 2008. A 23 percent  increase in bank repossessions helped push Nevada foreclosure activity up 5  percent from the previous month.

Other states with totals among the 10 highest in the country were Arizona  (16,865), Michigan (13,891), Ohio (11,360), Illinois (10,942), Georgia (10,516),  Texas (9,813) and Virginia (5,385). The top 10 states accounted for nearly  77 percent of total properties with foreclosure filings nationwide.

California, Florida, Nevada dominate top 10 metro foreclosure rates

Foreclosure filings were reported on 14,681 Las Vegas properties in May, one    in every 54 housing units — more than seven times the national average    and the highest foreclosure rate among metro areas with a population of at    least 200,000. The city’s foreclosure activity increased 4 percent    from the previous month and 78 percent from May 2008.

California and Florida accounted for the remainder of top 10 metro foreclosure  rates.

California cities accounted for six of the top 10 spots: Stockton at No. 2  (one in 68 housing units), Modesto at No. 3 (one in 71), Riverside-San Bernardino  at No. 4 (one in 75), Merced at No. 5 (one in 78), Bakersfield at No. 7 (one  in 94), and Vallejo-Fairfield at No. 9 (one in 101).

Florida cities accounted for three of the top 10 spots: Cape Coral-Fort Myers  at No. 6 (one in 82 housing units), Orlando-Kissimmee at No. 8 (one in 101),  and Miami-Fort Lauderdale-Pompano Beach at No. 10 (one in 105).

Click her to see the complete press release from RealtyTrac.com

FHA loans are U.S.federal government guaranteed to the lending bank.  So if the borrower defaults, the government is on the hook for the mortgage instead of the lender.   Essentially, this means that when the home goes into foreclosure, the government owns the home. 

The FHA relies primarily on an auction system to get rid of excess properties.  People in the know often pick up good deals at FHA foreclosure auctions.  Many old pros involved in home flipping use FHA auctions to generate many of their properties.  They buy the properties, fix them up, and sell them at a large premium.

It is possible to build instant equity in a property purchased at a FHA foreclosure Auction. Investors can also qualify for low down payment options, which makes getting started in real estate investment possible even for those who don’t have a large cash reserve to invest.

Properties purchased through a HUD or FHA foreclosure are eligible for FHA foreclosure federal administration mortgage financing. When a FHA foreclosure is purchased, the Federal Government again insures the bank that the FHA home loan will be repaid, even if the government has to do it. making it more attractive to lenders.

The higher default rate is partially offset by a 2.25 Mortgage Insurance Premium that is added onto the monthly mortgage payment.

The FHA is a government agency, making it more transparent than banks.  The FHA has a vested interest sell all their properties at a FHA foreclosure auction because the biding that takes place increases the sale price.  Despite all these reasons to invest in FHA foreclosures, many people still believe that finding FHA foreclosure leads is difficult. 

Many FHA foreclosure listings are available on the HUD (Housing and Urban Development) web site at http://www.hud.gov.  When you buy a FHA foreclosure through HUD, you will generally need to use a HUD approved real estate agent.  Also, HUD homes purchased through auction have the requirement of owner occupied rather than as an investment property.  If you are a public servant such as a teacher and firefighter you may qualify for a discount on HUD homes.

Because no appraisal is required, you may actually gain instant equity in the property.  Also the credit requirements are flexible, with a low down payment, and HUD pays the closing costs.

If you are looking for an investment, consider FHA foreclosure properties it is a relatively easy way to get a first home for yourself, or upgrade your lifestyle, without the up front cost or risk of many hard money financing schemes required to purchase investment property, or even of a traditional loan.

Many homeowners are not aware that they can stop mortgage foreclosure on their own. But you can save your house. In most states, you can redeem your home up to an hour before it goes to auction. So, being able to line up new financing is key.

A number of options are available to homeowners facing foreclosure. Some on the options available to you include refinancing, short sales, and deeds in lieu of foreclosure.

In the past, banks would do nothing to stop mortgage foreclosure. They simply allowed you to go into default and then bought the home themselves or sold it at auction. However,  massive depreciation caused by the housing crisis means they now have hundreds of thousands of homes and mortgage losses on their books. Many of these are sitting vacant in ghost towns and are virtually un-rentable and un-saleable.

This gives the mortgage distressed homeowner leverage they never had before, your bank will likely try to work with you to get your house refinanced and help you to keep your home. For instance, they might lower the interest rates, amortize delinquent payments, adding them onto the end of the loan, revalue your property, or provide other loan modification. But you need to work directly with the lender yourself or hire a reputable loan modification company to do this for you.

Until the end of 2008, the banks were unwilling to work with a homeowner until the loan was 30 days delinquent. Today, many banks want to keep people out of delinquency if at all possible. It is to your advantage to let your bank know right away if you think you might miss a payment. Also recent government home-owner programs were put into place. One that is referred to as the Obama program gives certain benefits to lenders that are willing to work a compromise with you. there are also HUD programs and programs put into place by the lenders themselves. You need to talk to your lender, or another bank’s refinance department to see if you qualify. Also call the local HUD office. They can give you information about other State and Federal government mortgage assistance programs.

a short sale is another option to stop mortgage foreclosure. This involves a three way deal where all of the parties win. You find an investor who is willing to buy your home at a price that is less than what you owe. The bank agrees to waive the difference. The reason this plan tends to work for everyone is that the bank gets a non-performing loan off of its books, the investor gets a good deal, and you get to walk away from your home. If you are pursuing a short sale, you must make sure that the bank has forgiven the deficiency so that you do not end up with a massive deficiency judgment against you.

A deed in lieu of foreclosure is the third option to stop mortgage foreclosure. A deed in lieu is similar to a short sale only that instead of having an investor buy your property, it is just between you and the bank. The bank buys back your home for less than the loan value and you walk away. Banks are sometimes willing to do this is because you guarantee that the property will be in good condition. Many foreclosed homes have been completely trashed, right down to having the copper pipes taken out and sold for scrap. So, a deed in lieu gives the bank a good deal as well. Again, you should make sure that the bank has wiped out the deficiency in such a deal so that you do not end up with a judgment against you.

There are solutions if you are looking to stop mortgage foreclosure.   But you must seek them out before you get too deep in the red and behind on many months of payments. Many times owners are in denial about their situation, and do nothing but just let it escalate until they no longer have options left. These people end up paying a huge price in the end. So if you know you are in trouble, don’t wait. Seek out advice and make a smart move to stop the process before you totally lose all control.

Source: http://www.realty-info.org

© 2009: Rights given to reproduce this article with back link to www.realty-info.org

Washington, D.C. (AHN) - Senate passed a bipartisan legislation to alleviate the housing crisis on Thursday. The measure, called the Foreclosure Prevention Act, includes a provision earlier rejected by the White House to provide $4 billion to buy up and refurbish foreclosed properties.

Senators voted 84-12 to pass the legislation drafted by Banking Committee Chairman Sen. Christopher Dodd (D-CT) and Rep. Richard Shelby (R-AL), the committee’s highest-ranking Republican. The measure sets aside $10.9 in bonds to refinance sub-prime mortgages, $180 million to counsel homeowners with bad loans, tax incentives for businesses and buyers of foreclosed homes. The controversial provision to buy up foreclosures was also included despite the White House previously saying it “constitute[s] a bailout for lenders and speculators.”

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