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Showing Your Home While Keeping Your Privacy In Tact

Showing Your Home While Keeping Your Privacy In Tact

Make no mistake about it, home buyers will open nearly every closet and cabinet within your home. In fact, you want to encourage buyers to move and touch things within your home, but you should also learn how to keep your private information hidden during an open house.

Any part of your home that will remain after the sale, is open for investigation. This means that built in cabinet drawers; dining room china cabinets (that will be sold with the house); and bathroom medicine cabinets are all beckoning buyers to snoop around. Well, technically, they aren’t snooping if they simply want to see how large a piece of furniture is, but you should still avoid leaving things such as comparative market analyses laying inside of a drawer. In fact, you should keep all personal information fairly well hidden at all times.

Never leave opened mail strewn throughout your house. Just imagine what sort of offer a buyer might propose if they see a stack of credit card bills awaiting payment. Buyers may also note letters from the IRS; mortgage payment notices; or anything else that may put you in a compromising position.

While most home owners leave mail stacked on the kitchen counter, place your mail safely inside of a desk drawer, and make sure that the drawer cannot be opened. When it comes to other personal items, make sure that you disguise them as well.

Believe it or not, a diploma or wedding photograph should not be kept on the wall. Why? Well, certain buyers will apply instant biases depending upon what sort of information they find. For example, if you leave a law degree plastered on the wall, some buyers may immediately feel as though a lawyer cannot be trusted. In the same manner, if a buyer sees a recent wedding photograph, they may start to form an opinion about the type of religion that you practice. It is best to keep all personal items (even books and music) out of sight. Also, keep your closets tidy and in tact.

You may think that leaving certain clothing items hanging in your closet is not a bad idea, but make sure that the items do not say anything too personal about you. While most home owners do not think about personal items, do yourself a favor and clear out your home prior to any open house.

Make sure all personal details are hidden, and make sure that your home does not tell anyone all about your life.

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The Right Remortgage Deals – How to Decide

The Right Remortgage Deals – How to Decide

Following the decision to remortgage your home, choosing the right remortgage deal is the most important decision you have to make. To ensure that your deal offers you the greatest benefits, it’s important to make sure the deal is the most compatible for your unique financial circumstances. Remember to talk with market professionals in order to get the best advice. Until then, however, here are some basic features that may be available when choosing your best loan option.

One important thing to remember is that deals revolve around the lender’s SVR, or Standard Variable Rate. Whether you’re paying the SVR or not, most loans and their interest rates relate to it. A common deal called a discount mortgage is a good example.. The benefit of the discount mortgage is that it offers a reduction on the SVR. If the rate changes, the amount you pay changes automatically to reflect that. The discount benefit of this type of home loan relies heavily on the length of the deal.. The shorter the period of the discount, the greater the discount.

The tracker mortgage is a comparable loan offer. If you have this type loan, you know for certain that your interest rates are in line with bank base rates. The benefit of this type is that even if there is a delay in reducing the lender’s SVR to reflect cuts in base rates, cuts are automatically applied to your loan’s interest rate. You see immediate change and your payments reflect the new, cheap rates instead of having to pay at an old rate while waiting for changes to kick in. Many tracker mortgages also offer fairly flexible terms that might be very appealing.

A flexible mortgage allows you to vary payments from month to month to reflect any changes in your finances. The options are to over- or under-pay, re-pay lump sums or take advantage of a payment “holiday” and pay for another major expense instead. It may be possible to take advantage of more than one of these offers instead of having to choose only one. The best feature of these incentives is that generally there are lower or no fees associated. These types of benefits are dependent on certain conditions, such as being in good standing on current payments or exceeding the terms of your payment schedule.

When you research and compare remortgage options, you may be surprised to find that more than one deal could benefit you. You can choose a plan for its cheap interest rate or for the absence of fees; it doesn’t matter because there are multiple options for your unique desires. If it’s not working for you, you don’t have to be locked into a mortgage plan.

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Due Diligence For Real Estate Investors

Due Diligence For Real Estate Investors

Protect yourself and your investment by doing some things that could pay off big down the road when you are looking for the right properties to buy.

Real estate investors must be very careful and knowledgeable in order to protect their financial investment and get the best deal possible. Savvy buyers, no matter what they are buying have a set of shopping rules when making a purchase…the best price possible…haggle…inspect carefully (buyer beware)…best quality you can afford…so why not do the same for a really big purchase like real estate you buy as an investment?

It starts with picking your target location. What do you need in a target area where you want to invest? If you are investing in single-family homes or apartments, you might look for the best possible schools along with convenient shopping. A professional might want office space. An entrepreneur might want a store space and living space in one where lots of shoppers gather. Narrow down your needs and desires. Then decide what area fulfills your list of needs and wants and start deciding what you can afford.

Some commercial ventures may not be location sensitive. You might find something cheaper further out, but still in the path of development and changing zones from rural or residential to commercial. Or you might find a good location that’s improving from previously depressed values. If you can see the improvement coming it could be a great decision.

Then get your financing in order and pre-approved before you narrow down your target properties. No Realtor will take you seriously if you don’t take this step. We all have to be realistic about what we can afford.

A good Realtor will listen to you. If they show you a lot of properties that don’t seem like good matches, you may need to consider changing to someone who listens better.

When you have found a property that seems to fit your needs, make the Realtor prove value. Ask to see a market analysis of properties VERY close by that have sold and closed in the last 60 days. You may find that the property you’re buying is significantly over or under priced. This data is available from “Multi-list” or at the local tax office.

Study selling prices in your target area to make sure you know enough about prices, especially if you want a fixer upper. Fixers need to sell low enough to justify the cash you plan to invest in remodeling. Any good appraiser will tell you asking prices are often very different from selling prices. Don’t believe everything you hear. Get the facts.

When you feel like the time is right, make an offer contingent on an inspection and obtaining financing. Inspections can cover a number of issues that could cost you money, like pest infestations, environmental issues, and broken stuff. Do them all. With this data in hand you can go back to the seller and HAGGLE big time. Try to get the seller to lower the price, not make the repairs. Any work the seller does at this point WILL be quick and dirty. If a structure is in pretty bad condition you can make a really low offer, one that would justify the amount of work you have to do. It might be accepted. You never know. And you might find something that would make you pass on the property. If you have the right contingency contract you only pay for the inspections.

If you make a deal be sure and get a title search and title insurance, preferably the day of closing. This is especially important if you are to have a clean title free of workman’s liens, tax liens or other debts that you would have to repay in order to have a property you could resell. It’s the single most important thing that happens to protect the investment you make that many buyers don’t see a need to pay for. It is worth it.

Another thing that’s worth the money you spend on it is a survey. You need to know if there is any encroachment or easement on your property. Many of these things could involve expenses for you. A municipality might expect you to accept liability for water damage to other owners below your property. You don’t want this kind of problem. Know these things ahead of time.

The point is you have to really study hard and go in armed with knowledge. A real estate purchase may be the biggest investment people ever make in their lives or businesses. In the current real estate market, capable buyers have an advantage. Maximize your advantage by being well educated. Knowledge really is power.

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Ways to Sell Your Mortgage Notes

If you want to sell your mortgage note click here for a free quote. We buy mortgage notes!

It happens to many Americans, that when they sell their house they still carry a mortgage.  Each and every year, the same question is asked ” How can I sell my mortgage note and get the cash I need?”  If you are the holder of mortgage notes for sale, this information may be of assistance.

Annually, millions of real estate transaction are done without the involvement of a real estate agent or bank.  Often a home owner can make a lot more money, when he decides to do the financing himself.  Properties that are normally discounted under normal conditions and properties that are under standard, can now fetch top dollar in the market.  But when they do the financing, they sell to people that either don’t want to or can’t get bank financing.

Completing this step, makes a real estate note.  The new home owner makes the monthly payments to the person that has the cash flow note, so the seller becomes the bank.

The seller may want to cash out the real estate note after a certain amount of time if he so decides depending on his circumstances.  Now when you have a cash flow note for sale you have a couple of options.  You don”t have to sell the whole real estate note. You can just sell part of it to raise the cash you need.

A dependable private real estate investor with cash to purchase your real estate note is needed in order to sell real estate notes.  The key to finding the value of your mortgage note lies in finding an investor who can determine its worth.

Those who buy notes professionally won’t charge you for speaking about your cash flow note, especially if this first discussion takes place over the phone.  But you will find out a lot about how to cash out a real estate note.

Always keep in mind that the note buyers have to buy the notes at a discounted price and that too it should be large enough to cover the inflation and the risk.   The real advantage to you of a transaction like this is that you recieve the money immediately.

Discovering the value of your real estate note is fairly simple, and private real estate investors compete for mortgage notes for sale, so peruse real estate investors’ websites if your finances require it.  Ask them for information on how to cash out that real estate note you have.  We often have a tendency to make things harder than they actually are, just because we lack certain knowledge or do not feel like asking questions.  Availability of internet has made the knowledge conveniently accessible in today’’s world.

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More Borrowers Quitting Obama Mortgage Program

It seems that borrowers are not satisfied with the efforts of the government to help homeowners who are on the verge of losing their homes. Reports said more than a third of the 1.24 million borrowers who have enrolled in the Obama administration’s mortgage modification program have dropped out.
Data showed that a total of 436,000 people have dropped out of the $75-billion program since it was launched in March 2009. In May alone, some 155,000 people stopped trying to get loan modifications. The number of borrowers, who have received permanent loan modifications, meanwhile, stood at 340,000.

According to market analysts, the program did little to ease the plight of borrowers. “The foreclosure-prevention program has had minimal impact. It’s sad that they didn’t put the same amount of resources into helping families avoid foreclosure as they did helping banks,” National Community Reinvestment Coalition chief executive officer John Taylor said.

One of the reasons blamed for the high turnaround rate is the documentation of income required for homeowners who want to get loan modifications. To apply for the program, a borrower should submit two recent pay stubs to banks at the start of the process. Because of the new application procedures, the number of borrowers wanting to get loan modifications declined dramatically. According to reports, around 30,000 homeowners started the program in May, down from more than 100,000 people who signed up each month starting last summer.

Industry experts believe that the country’s problems with foreclosed properties could worsen if more people are going to exit the program. They also warned that it could further weaken the housing market and impede with the economic recovery.

Seller financing aids the seller and buyer

Seller financing is one field of the real estate industry that aids more than the house purchaser and the individual house seller. Home mortgages held by sellers are likely customers for investors that purchase seller financed home mortgages. For many people outside the real estate industry, this little observed market is large business for many. In order to understand how this market works, we have to recognize both sides of the business of owner will carry financing.
In a down market such as we are experiencing now, credit freezes up and conventional lenders inside the mortgage industry approve very few new mortgages unless the candidate has higher than average credit. For those people with less-than great credit, acquiring a loan thorough traditional channels is non-existent. Fortunately for these people, there is a large quantity of houses on the market with sellers willing to unload.
Some of these sellers are ready to offer what is called owner will carry financing which means they will operate as the lending institution. Rather than having to pay a credit business each month the customer will pay his monthly mortgage to the home seller. When financial times are good and lending institutions are offering creditowner carry financing is at a low. More people can obtain credit thorough conventional means.
The seller will carry the note until the note is paid or he sells the cash note to someone else, in this case a mortgage investor. Mortgage note investors are people that specialise in buying and selling money transactions. Notes come in many different varieties. Just about any transaction where a agreement is signed and a repayment plan is the mode of repayment, can be bought and sold.
Seller financed notes are the most widely recognized with the mortgage industry as they are real estate based. The market is built easily enough as sellers many times desire to free up the cash they have tied up in the cash note they are holding on the property. The seller may need the capital for any amount of reasons. He may want to make further investments with superior returns. Crisis conditions might have come up that force him to liquidate his holding. Children might need to go to university. The motives are endless.
Whatever the case may be, there are loads of investors eager to acquire these seller held mortgages. These investors purchase these money transactions largely for investment motives growing their portfolios. Though, income streams are the major purpose. By getting just a few notes the investor can generate a significant monthly income stream that will continue until the contracts are fulfilled or sold to another person.
In come instances, these mortgage notes are defaulted on at which time the investor forecloses on the house, keeps all the funds he has collected on past repayments then sells the property to another buyer. Seller financing aids many individuals involved in a real estate transaction. Individuals that can not acquire a mortgage through established means, single sellers as well as those investors within the notes industry.
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Q.   I own my single-family home with no mortgage outstanding, and I'm gainfully employed in a secure government position. I plan to retire in about five years. I have lived in my home for the past 20 years, but now find it to be more burden than haven. I am planning on selling it and renting a nearby townhouse condominium. I listed my home with we thought was a competitive price. But it has been on the market for nearly six months, and I've received only two low-ball offers. I reduced the price twice.

I've been told the banks are causing a problem. There are a lot of self-employed folks with cash who cannot get mortgages. I am thinking about offering my house for sale with 70 percent seller financing. My hope is to get it sold for full price, earn 5.5 percent interest on my money and, if the buyer defaults, get my house back down the road. I can do a 5-, 10- or even 15-year balloon mortgage based on a 30-year payoff schedule. I have been told that I am not obligated to accept any buyer; if I don't like their credit, I say no.
I believe offering seller financing will give my listing an edge and might get some action. I am thinking of insisting that the buyers prepay the first year of homeowners' association dues and an estimated water bill because I understand that these items can become liens against the property. I am also planning to ask the buyers to pay into an escrow account each month to cover the semiannual real property taxes and the annual hazard insurance premium when they become due. That way, I can ensure that these critical bills are paid because I will be paying them from the escrow account. 

What's your opinion?

A.   I strongly endorse this seller-financing approach, as long as you get a substantial down payment. And, since you indicated you will be getting 30 percent down, that should be sufficient. This plan will also provide you a regular monthly source of funds for many years, depending on how long you are willing to wait to get all your money, plus interest. Although the principal portion may or may not be taxable (because you are selling your principal residence, you are entitled to exclude the first $250,000 of capital gain from your taxable income), the interest portion of each payment will be taxable to you.

I recommend preparing an amortization table to show you and your buyer how much of each payment is principal and how much is interest. Amortization tables are available at sites such as Bankrate.com.

Seller financing is an excellent means of obtaining the best price for your home, but it is not without risk. One concern is that a 5.5 percent interest rate might look fine now, but rates can fluctuate wildly. Ideally, you wouldn't want to hold that 5.5 percent note for more than a few years. If you think interests rates will fall, you should consider imposing a prepayment penalty in your promissory note. Prepayment penalties are governed by state laws.
If you think interest rates will rise, consider offering to take back an adjustable rate mortgage. An ARM is a mortgage that has a fixed interest rate for a certain period of time, after which the rate changes at set intervals. In your case, assume that the 5.5 percent interest rate would be fixed for five years. At the end of the first five-year period, the interest rate would adjust annually. This adjustment feature protects you should interest rates rise five years down the road.
The adjusted interest rate is a function of an index (assume the prime rate as reported by The Washington Post) plus a margin of one to three percentage points, for example. On the adjustment date specified in your loan contract, you would add the margin to the index to get the adjusted interest rate. You might want to consult a financial planner or stockbroker to assist you in determining which index and margin to use.

Make sure the promissory note that the buyer signs is fully negotiable, that is, transferable to another party. There is a fairly brisk market in these types of seller-financing notes. Once the note is seasoned, with the buyer having made regular payments for six to 12 months, you will be able to sell it (albeit at a discount) if you ever want the pile of cash. You will also want to make sure the loan is secured by having your buyer sign a deed of trust. Have that deed of trust recorded in the land records office as a lien against the home. That way, if the buyer defaults, you can foreclose and get the house back.

I'd recommend insisting on an automatic debiting feature so monthly payments are taken from the buyer's checking account and deposited into your separate "My Old House Note Account." That way, you can go online every month and monitor the payments.

You should do a credit check with all three credit-reporting bureaus and obtain your buyer's FICO score from Myfico.com. Prior to the closing you should insist that the attorney conducting the closing provide you with a closing-protection letter from his title insurance underwriter. The letter protects you against any problems with the settlement attorney.

At settlement, make sure you obtain a lender's policy of title insurance at your buyer's expense. Finally, have the buyer pay all credit report and closing costs, including the expense of having the promissory note and deed of trust prepared and the deed of trust recorded.

This is not legal advice and should not be acted upon without obtaining your own legal counsel.
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Importance of Mortgage Calculator in Real Estate Business

Mortgage calculator solutions can enable best in class debt management solutions in no time. One of the much aspired benefits of mortgage calculator based solutions is their intrinsic ability to provide prevalent interest rates to debtors in a unified and fair manner. As a result debtors can easily make smarter decisions based on mortgage calculator solutions on the go. Online solutions should also be explored while trying to explore mortgage calculator based solutions in a seamless manner. Real estate market across the globe is picking up. The prices of plots, apartments and condos are expected to head northwards. Home loan financing can be better addressed through mortgage calculator based solutions over shorter span of time on the go in a seamless manner.

 Real estate business has taken an altogether new meaning with mortgage calculator based solutions. With an increased competition in the market, home financing solutions can be availed across various service providers at competitive rates in no time at all. A mortgage calculator solution will enable one and all in calculating mortgage financing quote based on their risk factors and assumptions in a seamless manner. Simple inputs such as current liabilities, assets and income sources can enable one and all in customizing mortgage calculator based quotations.

Prospective home owners can consult reality agents, realtors or bankers for enabling mortgage calculator based solution for powering their home loan needs. A competitive home loan can provide longer term solutions in no time at all. However, risk factors and assumptions should be properly understood and assessed while calculating liabilities with the help of mortgage calculator based solutions.

Service providers generally assign different weight structures to the assumed risk factors on the go. As a result, each service provider may provide their set of unique mortgage calculator based quotes in no time at all. Real estate solutions are being powered by mortgage calculators. Service providers and debtors can get to benefit from the endless potential that is being offered by mortgage calculator solutions in a seamless manner. Get going and benefit from mortgage calculator based solutions from day one in no time at all.

Refinancing Mortgage With Bad Credit

Refinancing mortgage with bad credit

You might be surprised to know that you can get a mortgage refinance even if you have a poor credit history. Even though banks have tightened up their lending standards considerably, you can still attempt to refinance mortgage with bad credit. There are many lenders such as specialty bad credit mortgage brokers and bad credit mortgage lenders that offer you loans under such circumstances. Though these loans carry a higher interest rate and have higher closing fees, it can help you to improve your credit score in the long run.

Tips to help you get a bad credit mortgage refinance loan
Make sure that you follow these steps while you are looking to get mortgage refinance with bad credit:

• When you attempt to refinance mortgage with bad credit, it is better to apply to only those companies who offer mortgages to borrowers with poor credit score. So, find out those companies who offer assistance to individuals with financial difficulty.
• Always does your research before you apply for refinance. Shop around extensively to get the best deal. Make sure that you consider all the factors like interest rates, loan term and other hidden costs before you choose one.
• Do not appear desperate to get a mortgage refinance. Remember that there are many unscrupulous companies and lenders ready to take advantage of your situation. So, beware of such companies that make you believe that you have no other options to look into.

Benefits of a bad credit mortgage refinance loan
There are many advantages of taking out a bad credit mortgage refinance:
1. Refinance can lower your monthly payments by extending the mortgage repayment period making your payments affordable.
2. As the monthly payments become affordable, you'll be able to repay the loan sooner and this will help you to improve your credit score.
3. You can lock in more favorable mortgage interest rates which will also make your payments easier.

Remember that a larger down payment can help you get to refinance mortgage with bad credit more easily. So, when you have a low credit score, you need more cash on hand to compensate on home loan.

Government offers Home Affordable Modification Program

New alternatives to foreclosure unveiled
Government offers Home Affordable Modification Program

Homeowners who can't afford their mortgage payments may want to take a look at the federal government's new alternative to foreclosure: the Home Affordable Foreclosure Alternative program, or HAFA, which intended to encourage lenders to facilitate short sales and deeds-in-lieu, or DIL, as alternatives to foreclosure.

The program, which is a part of the Home Affordable Modification Program, or HAMP, may help some homeowners escape a bad situation, but the rules are complicated and they won't be able to keep their homes.

U.S. Treasury Assistant Secretary Herbert Allison explained the concept in congressional testimony.

"HAMP does not, nor was it ever intended to, address every delinquent loan," he said. "In these instances, the borrower may benefit from an alternative that helps the borrower transition to more affordable housing and avoid the substantial costs of foreclosure."

Here are some details from the government's 43-page directive for loan servicers:

A short sale allows the homeowner to sell the home and use the proceeds to satisfy the first mortgage even if the sale price is less than the loan balance.

A DIL allows the homeowner to voluntarily give up the home to satisfy the first mortgage even if the home is worth less than the loan balance.

The homeowner can get pre-approval for a short sale at a specific minimum price or net proceeds before the home is put on the market.

The homeowner can receive $1,500 for relocation expenses at closing. This sum may be reported to the Internal Revenue Service as income.

The home must be the homeowners principal residence.

The mortgage must be delinquent, or default must be reasonably foreseeable.

The unpaid loan balance must be less than $729,750 for a single house or condominium. Higher limits are allowed for two- to four-unit residential properties.

The homeowners monthly mortgage payment must be more than 31 percent of his or her gross income.

The homeowner must transfer clear title. The lender will allow up to three percent of each second loan or lien, up to $3,000 in total, to help the homeowner satisfy these obligations.

The government's directive excludes loans that are owned or guaranteed by Fannie Mae or Freddie Mac. However, the two government-run mortgage corporations are expected to release their own guidelines.

Homeowners can use the Loan Look Up Tool on the Making Home Affordable Web site to find out whether they have a Fannie Mae or Freddie Mac loan.

The lender cannot require a cash contribution or promissory note, cannot pursue a deficiency judgment and must release the homeowner from all future liability for the debt.

The loan servicer can use the financial information and hardship letter that the homeowner submitted for a loan modification, or request updated information to evaluate the homeowners eligibility.

The loan servicer must assess the current value of the home. If the short sale or DIL isn't completed, the servicer can add the cost of this assessment (e.g., an appraisal) to the loan balance.

The homeowner must sign a Short Sale Agreement or DIL Agreement on or before Dec. 31, 2012.

The home must be listed for sale with a licensed local-area real estate professional. (This requirement doesn't apply to DIL.)

The homeowner must cooperate with the real estate professionals efforts to sell the home and maintain the interior and exterior of the home.

The servicer and homeowner must meet a number of time frames.

The lender may require the homeowner to make full or partial payments on the mortgage, up to 31 percent of the homeowners income, subject to the lender's written policies.

The homeowner cannot have a close business or personal relationship with the real estate agent or buyer and cannot have an expectation of buying back or renting the home after the short sale or DIL closes.

The lender can initiate or continue, but not complete a foreclosure sale while the homeowner is involved in the program.

Homeowners should discuss the income tax consequences of debt forgiveness with a qualified tax professional.

The servicer will report the short sale or DIL to the credit bureaus. That will hurt the homeowners credit score, although not as severely as a foreclosure.

The buyer in a short sale can't resell the home within 90 days of the purchase.

The program launched April 5 and is scheduled to sunset on Dec. 31, 2012. Servicers may elect to implement the program sooner than the official effective date.

Homeowners are encouraged to contact their loan servicers to find out whether they are eligible for the program or call the HOPE hot line at (888) 995-4673 to speak to a government-certified mortgage counselor. More than 100 servicers have signed up for the program.

These servicers are required to participate and write their own policies subject to investor guidelines.

Going up

Mortgage rates jumped for the second straight week.

The average 30-year fixed-rate mortgage rose 12 basis points, to 5.35 percent. A basis point is one-hundredth of a percentage point. Rates have risen 24 basis points in two weeks and are now at their highest point since Nov. 4, 2009.

Meanwhile, this week's average 15-year fixed-rate — a popular option for refinancing — leapt 16 basis points, to 4.69 percent.

The average jumbo 30-year fixed rose 6 basis points, to 5.98 percent.

Adjustable-rate mortgages split this week. The one-year adjustable-rate mortgage remained unchanged, at 4.74 percent. Meanwhile, the popular 5/1 ARM rose 4 basis points, to 4.55 percent.



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Second mortgages may haunt borrowers in foreclosure

Just when owners think their mortgage nightmare has ended with the loss of their home through foreclosure, the next round of bad news knocks at the door: the bank holding their second trust deed demands repayment of the loan.

Despite heavy political pressure to write off so-called "junior"- or second-lien, mortgages to help struggling owners keep their homes, banks aren't always willing to follow that script. Why? Because those loans amounted to $1 trillion in the U.S. at the end of last year, according to the Federal Reserve, and many banks hold a lot of that paper. A second trust deed is a loan in a subordinate position to a first trust deed loan secured by the same collateral.

Although owners and many banks are trying to strike deals to reduce the payments on homeowners' first mortgages, the main sticking point to consummating those transactions is that lenders holding the first liens often will not accept a deal unless the banks holding the second mortgages take a hit too. But those banks, which are trying to get their assets back in the positive column, don't always want to write off the junior liens.

It's not unusual for second liens -- typically loans taken out after the house was purchased -- to lack collateral backing today because of the steep drop in home values; sometimes a second mortgage is below the amount owed on the first mortgage alone. That's why some politicians are urging banks to write off those "worthless" second liens. Many homeowners who are in default on their first mortgages, however, still are making monthly payments on the second liens, so banks don't want to kiss those loans off. The ability for banks to collect on second liens varies by state.

How pervasive is the problem?

"I see it all the time," says accountant Earl Salter, an enrolled agent with Norwalk Business Service in Norwalk, Calif. Financially shaky owners who have lost their homes to foreclosure and face second-lien lenders demanding repayment "have two choices: file bankruptcy or try to strike a deal with the holder of the second to accept 10 or 15 cents on the dollar" owed, he said.

If lenders and borrowers don't strike a deal, lenders may garnish the borrowers' wages and other assets, if the owners have some income or the potential for income. In some cases, banks sell the junior-lien loans to collection agencies, which take over recovery of the debt.

While many banks are making decisions about repayment of second-lien loans on a case-by-case basis, lawmakers are seeking solutions for borrowers unable to repay junior-lien debts. One U.S. Treasury program requires the reduction of payments on junior-lien mortgages by participating lenders if they're allowing reductions on first mortgages.

Of one thing you can be sure: we haven't heard the last of this issue yet. Other programs already are on the table.





Diane Wedner

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Help Sell Your Home Faster

1. Get a home inspection before you sell. It is always better to be proactive and know what if anything is wrong with your home before a buyer does. They will ask you to drastically reduce your asking price.

2. Clean clutter. Nothing turns off a buyer like junk and clutter.

3. Ask 10% lower price than the property is worth. This will bring more buyers and the price will get bid up.

4. Get light into the home. Clean windows and get rid of dark drapes. Nothing sell better than natural light, it makes your rooms look bigger.

5. You do not need to bake cookies. Place a few drops of vanilla on a warm oven door will produce the same results.

6. Replace a worn mailbox. This will enhance the curb appeal.

Please feel free to post your tips.
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Quote for the Day

"Until one has loved an animal, a part of one's soul remains unawakened"

Quote for the Day

"Until one has loved an animal, a part of one's soul remains unawakened"

Seller financing can be a great way to get a house sold.

Seller financing can be a great way to get a house sold without
slashing the price. By recognizing the millions of people who can't
get traditional financing as potential buyers, resourceful property
sellers (and their real estate agents) can minimize their time
investment in getting a property sold. Even better, sellers who offer
financing can usually get a higher asking price for their property,
even in the slowest markets. Clearly this is a win-win situation.

Most home sellers never consider financing the buyer directly because
they are not aware of the benefits or don't fully understand how
creating a note works. Let's take a closer look at the advantages of
owner finance.

Three Advantages

Seller financing is very powerful when the market is slow or when
there are many similar houses on the market. Just listing the house as
"OWC" - Owner Will Carry - will make the house stand out and attract
more buyers. Because many individuals cannot get funding from a bank,
offering financing will open the doors to these prospective customers
as well, essentially significantly increasing the pool of potential
buyers. So, advantage #1 is MORE BUYERS.

Seller financing also brings the property seller another critical
advantage . the likelihood of selling for a higher price. Offering to
carry back a note will not only greatly increase the number of
potential buyers, but also bring a unique demographic of buyers who
are willing to pay more for a given property than the general
population. Advantage #2: MORE MONEY.

Additionally, when the property seller finances the buyer, they get to
act as "the bank". That means they could structure the deal to collect
interest. Over time, if the seller holds on to their note, this can
add up to tens of thousands of dollars in additional income. Advantage
#3: LONG TERM PROFIT.

The Seller's Strategy

Even when these benefits to "carryback" lending are made clear, many
sellers are still hesitant to offer financing because they are
entering unfamiliar territory. It's a natural, human response --
everyone is uncomfortable with new things.

For many property sellers, considering owner financing when they've
only dealt with buyers via traditional funding is definitely "thinking
outside the box". But once sellers understand the process, they are
likely to choose seller financing instead of the unattractive option
of cutting the listed price or waiting indefinitely for the "right
buyer".

A seller-financed real estate sale is simply a real estate transaction
where the seller acts as "the bank" or lending institution. The seller
sets the sales price, determines and accepts a down payment, and then
finances the remaining balance. The final step is the part that may
scare some sellers, but in actuality, it can be very simple. Here is
an example.

If the sales price is $100,000.00, and the buyer gives the seller
$10,000.00 cash (the agent's fee will be deducted from this down
payment), the seller will finance the balance of $90,000.00. The buyer
and seller would then agree to the terms, such as the interest rate
and the total term, and use an attorney to create the mortgage
document and close the deal. From that point on, the buyer sends the
seller monthly payments for the house he/she has just purchased.

Special Circumstances (and a Solution)

The whole process can really be that simple. But, there are some
substantial differences between a seller-financed deal and one that
relies on traditional bank funding.

First of all, the seller in this example does not receive a large,
one-time payment at the time of the sale. In fact, they will only
receive the down payment, and in some situations, most of that will go
towards paying the real estate agent's fee. On the other hand, the
seller will be receiving monthly payments at a decent interest rate,
but this income stream can't be used as a down payment for a new
house.

Since many home sellers are also looking to buy another property, the
seller will need to get enough at closing to pay their own down
payment. Without this payment, the seller's hands will be tied when
they look to purchase another house and need to have a substantial
amount of funds available. There is a common solution to this issue,
however.

The Solution

In order to get the money the seller needs from the loan they just
created, the seller could sell the monthly note payments to a
specialist buyer for a lump sum of cash. If the seller finds someone
willing to buy the payments, now they can "have their cake and eat it
too".

In summary.

Step one: Use the seller finance option to find unique customers
willing to buy the house at a higher price than would have been
possible otherwise and complete the real estate transaction quickly.

Step two: Decide on the terms of the deal and create the note.

Step three: If the property seller needs immediate cash to buy another
house or for any other reason, their new incoming payment stream can
be resold. The person who buys the future payments from the seller
will provide the funding to act as a down payment on a new house, and
every party involved in the deal comes out smiling.
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Getting More Than The Asking Price For Your Property

When the number of real estate buyers is greater than the number of available homes, real estate property values usually go up. It’s an ideal environment for sellers because buyers are forced to compete, and properties usually sell quickly – often for even more than the asking price!
But as more properties go on the market, buyer competition subsides. Prices level out, and eventually drop. Most assume this is a bad time to sell a home. But in fact, it can be the best time for educated sellers to tap into a little-known market, using the creative power of seller financing.
A seller’s best strategy
With the help of a professional Note Finder, a seller can open the doors to buyers normally locked out by traditional financing. A so-called “down market” is the ideal time for resourceful sellers to target the millions of people who can’t get funding. These buyers are often willing to pay more in order to buy a home without traditional financing.
The seller sets the price, determines and accepts a down payment, and then finances the remaining balance. The buyer gets a home without having to fully-qualify for a traditional loan. It’s a favorable situation for both seller and buyer. And while this “outside of the box” form of financing can seem a bit daunting, it can happen very smoothly and easily with the knowledge, experience, and guidance of a professional Note Finder like me.
Here is an example: If the seller wants $100,000 for the property, and the buyer gives the seller $10,000 cash, the seller will finance the balance of $90,000. The buyer and seller would then agree to the terms, such as the interest rate and the total term, and use an attorney to create the mortgage document and close the deal. From that point on the buyer sends the seller monthly payments for the house he has just purchased.

A great opportunity for sellers
The whole process can really be that simple. But there are some substantial differences between a seller-financed deal and one that relies on traditional bank funding.
First of all, the seller will not receive a large one-time payment at the time of the sale. In fact, she will only receive the down payment. Since many home sellers are also looking to buy another property, the seller may need to get enough at closing to pay her down payment. Without this payment, the seller’s hands could be tied when she looks to purchase another house. There is a common solution to this issue that offers the potential for even MORE money to the seller!
Note Finders specialize in helping new mortgage holders sell newly-created notes for a lump sum of cash. In the end, seller financing could be used to sell property at a higher price than expected and the sellers could get the money they need. Essentially, sellers can “have their cake and eat it too.”
In summary
Step #1: Use the seller-finance option to find unique customers willing to purchase at a higher price than would have been possible otherwise.
Step #2: Decide on the terms of the deal and create the note to complete the real estate transaction quickly.
Step #3: If the property seller needs immediate cash, contact me to help locate a buyer for the new mortgage note. The person who buys the future payments from the seller will likely provide the funding to act as a down payment on a new house and every party involved in the deal comes out smiling.

Equity attracts Note Buyers
One key to liquidating a seller-financed mortgage is found in the property’s equity. The equity in the private note essentially acts as a “safety net” for the Note Buyer, in case there is a problem collecting the payments. So note buyers find deals with strong equity more attractive.
Remember, a Note Buyer is purchasing monthly payments secured by property. If the property is worth more than the remaining balance of the note, the buyer could seize the extra value in a foreclosure situation by reselling the property. This allows the new Note Holder to recoup his initial outlay and receive the additional equity.
Most Note Buyers will do a quick equity check before looking at any other information. By first determining the note’s Loan-To-Value (LTV), buyers can decide whether to dig deeper or move on. The LTV is calculated by comparing the balance of all of the loans to the value of the property.
Two equity examples
To illustrate, let’s consider two houses, each valued at $100,000. One home has loans of $95,000 and the second home has loans of $70,000.
The first home has an LTV of 95 percent (95k/100k = 95), indicating only 5 percent equity (100 – 95 = 5).
The second home has an LTV of 70 percent (70k/100k = 70), showing 30 percent equity in the property (100 – 70 = 30).
Clearly, most buyers will not be as interested in the note on the first home because there is virtually no protective equity. In this situation, the buyer of the note would want to discount the note purchase a fair amount to make up for the fact that there is little equity.
The second note with 70 percent LTV will require less discounting, and the Note Holder will receive a larger portion of their note as compared to the note balance. This is because the Note Buyer stands to benefit from holding a substantial amount of equity in the property (30 percent) if the Payor were to default on their obligation.

How Does Down Payment
Affect Note Value?
For many Note Buyers the amount of the initial down payment at the time of sale can make or break a note deal. The down payment is applied directly toward principal, creating instant equity in the property. Accordingly, most Note Buyers want to confirm the amount of the down payment up front.
With no down payment, it would take many years to build a meaningful amount of equity in the property. Take a look at the following example that illustrates this point.
House #1: valued at $100,000, with a down payment of $20,000 made at the time of sale.
House #2: also valued at $100,000, but with zero down payment made at the time of sale.
The note on House #1 has $20,000 in equity. No down payment made on House #2 means that there is no equity in the property before the first monthly payment is made.

Consider how much “upfront” money there is
Assuming that House #2 was sold for $100,000 with a 30-year note amortized at 8 percent interest, it could take years to build $20,000 in equity.
Because the Note Holder’s purchase is protected by the equity in the property, the amount of the down payment is an important consideration. With the zero down note on House #2, the Note Buyer would need to apply a larger discount in order to make it a fair deal for him. On the other hand, while the note on House #1 is secured by a $20,000 down payment and has substantial protective equity even before the first monthly payment, it would cost the Note Buyer a lot more.
Almost any note deal can be a good deal… for everyone involved
A strong down payment lends a side benefit related to having protective equity. When a large down payment is made at the time of sale, that person is more likely to be committed to owning the house and keeping up with the note payments. Seller-financed deals with zero down payment are very attractive to first-time home buyers or others without a large nest egg saved – but it can be riskier for the Note Buyer. So the educated Note Buyers can offset this risk by increasing the discount on low or zero down payment notes.
Remember, even a note created without a down payment can be a sound purchase. The key is to look at each situation individually and to establish a fair price based on the specific note.
Even when liquidating a private mortgages at a discount, Note Sellers still get to receive a lump sum of cash immediately instead of waiting years – decades, even – before the debt owed to them is paid.
The bottom line is that a qualified professional Note Finder can bring a benefit to both parties – the Note Holder and the buyer. In the end, when a deal is struck, everyone wins and ends up in a stronger financial position.

How Creative Home Sellers Have The Advantage
Creative home sellers offering seller financing can often sell their houses faster in a slow market - often at a higher price! In the process, these sellers act as the “bank,” and begin to receive monthly payments instead of a lump sum of cash.
So what happens when those offering seller financing need an immediate lump sum of cash instead of scheduled future payments? Locating a buyer for the newly-created cash flow could be the answer.
To get the money they need, sellers that offer financing could sell the future mortgage payments they are set to receive.
How sellers get quick cash for their notes
This process can be streamlined when the savvy home seller lines up a buyer for the payment stream before the note is even created. This way the property seller could have a buyer for the payment stream ready to make the purchase as soon as the new private mortgage is created. Once the closing and the note sale are complete the seller will have the money she needs for her next home.

Finding the buyer for the seller-financed mortgage is the tricky part. Buyer's won't line up at the door. In fact, they don't often browse the newspaper or the web looking for people with notes to sell. This is where the professional Note finder comes in!

Note Finders are real estate professionals that specialize in connecting the people who create notes with those who buy them.

While I do not assist with the creation of a note, I can provide general recommendations about the types of terms that are attractive to Note Buyers. With my knowledge, experience, and connections within the secondary finance industry, I can save home sellers a lot of time and effort when liquidating a note. Most importantly, I can help locate a buyer for your note and make the process smooth and easy.

When working with a property seller who needs a lump sum of cash immediately after selling real estate, contacting a finder like me early in the process of creating the real estate note makes sense.

By involving a Note finder before a note is created, the property seller can receive valuable input about the payment characteristics that Note Buyers prefer.

And for any completed seller-financed deals, a qualified Note finder can help Note Holders obtain a large amount of cash in exchange for future payments.

Quote for Today

"SUCCESS IS NOT FINAL, FAILURE IS NOT FATAL: IT IS THE COURAGE TO CONTINUE THAT COUNTS." - WINSTON CHURCHILL
Books about Dogs

Quote for Today

"SUCCESS IS NOT FINAL, FAILURE IS NOT FATAL: IT IS THE COURAGE TO CONTINUE THAT COUNTS." - WINSTON CHURCHILL
Books about Dogs

Your Dog Can Help You Quit Smoking

Want to stop smoking for the New Year? You know the pitch. You’ve tried the patch. Time to send in the pooch.

Your dog can be an invaluable aid in your quest to quit cigarettes. Here’s the scoop on 8 ways to enlist your best friend to help you kick the habit.

Studies show that way people will attempt to quit smoking for the sake of their dog than  themselves or their children.

Make your dog an anti-smoking billboard. Buy your dog a T-shirt that will remind you of your goal every time you see him in it. When your dog is wearing clothing that implores you to quit smoking, you’ll find it harder to reach for a cancer stick. Start your shirt-shopping spree here or here. Or just type “dog t-shirt quit smoking” into your favorite browser.

Train your dog as a smoke alarm. Some people train their dogs to be household smoke detectors who bark at the first sign of smoke. These dogs work as a kind of backup to the more traditional plastic versions of smoke detectors. If your dog is really good at this, she may go the next step and woof you into non-smoking submission.

Share your financial windfall with Fido. If you smoke a pack a day, you’ll save nearly $1,500 per year if you quit! Think of the fun you and your dog could have with that extra dough. You both deserve it! Take a little road trip together. Buy yourselves something you’ve each always wanted.

Tips on Selling Your Property

When it comes to selling real estate, one of the most difficult and
frustrating situations for sellers is when market conditions make it
nearly impossible to sell at the desired price point. A high initial
listing price might be because the seller simply has an unrealistic
idea of how their house stacks up against the competition in the area,
or because the owner needs to sell for a set minimum price in order to
pay off their loan against the property.

With traditional property sales methods, the only way to prevent the
property from sitting on the market indefinitely is to keep dropping
the price. Unfortunately, this technique doesn't always work -
especially if the seller is unwilling to "discount" their house by
much.

In areas flooded with homes for sale, reducing the asking price
slightly will not bring the desired result. In fact, it's common that
the property will continue to sit on the market without offers,
alongside the multitude of other unsold properties with similarly
reduced prices.

Anyone experienced in sales understands that making your product stand
out from the crowd is a critical technique for success. But if there's
too much competition offering the same attributes, the only logical
way to attract the attention of serious buyers is to drop the price so
that your property is a much better value than the competition.

In cases where the seller is too inflexible with their asking price,
this is not a practical solution. Without an alternative strategy, the
seller is forced to keep the house on the market for an extended
period of time with an unrealistic asking price, hoping for the right
buyer to come along. And as you know, that "Mr./Mrs. Right" might
NEVER materialize!

The Seller Finance Solution

Property sellers who want to both obtain their desired price and close
on the deal quickly should consider seller financing. Seller financing
is a powerful tool to remedy real estate situations that otherwise
look grim.

Many home sellers (and their real estate agents) do not see seller
financing as a viable option. In actuality, seller financing can bring
new attention to the listing and invite a different group of potential
buyers - thereby opening up a unique, untapped market.

A large percentage of people throughout the country cannot get
approved for bank funding to buy real estate because of their credit
situation. Many of these people are still in the market to buy a
house, however. The "credit-challenged" are often frustrated with the
limitations of apartment living or being renters; as a result, many
are willing to pay a higher price just for a chance to get seller
financing and improve their quality of life.

A savvy property seller who recognizes this opportunity can salvage an
unfavorable situation and turn it into a bonafide seller's market. By
using this type of creative financing, the seller could actually end
up getting more than the original asking price - without resorting to
the questionable strategy of patiently waiting for the "right buyer".

Seller finance can enable homeowners to receive a favorable selling
price despite bad market conditions. In addition, the real estate
agent (if any) gets to close a deal and move on to other sales, while
a home buyer with poor credit is able to become a home owner. It's one
of those rare situations where everyone at the negotiating table gets
what they want.

Paper Tigers

Many home sellers never consider seller financing because they don't
understand the benefits. There are also common misconceptions that
it's much too complicated to attempt to orchestrate a seller financed
deal, or that there are no buyers willing to sign a private note.

Once a property seller takes the time to learn about the basic
process, the advantages of offering financing instead of a lower price
to sell their property become very clear. Plus, a little education
about seller finance will make it apparent that drafting a secured
private note is actually a very straightforward process.

The bottom line is seller financing can enable a home owner to "have
their cake and eat it too" - i.e., sell at the desired price, close
the deal quickly, and even receive additional income from interest
payments as well.