Short Sale Today….Buy Another Home Tomorrow…

Here’s how:

FHA allows borrowers to be eligible for a new FHA loan even if they just recently sold their principal residence with a short sale.

Almost every lender will tell you there is a 3 year waiting period as most lenders will not allow this program to be used due to credit overlays they have. There are specific guidelines that must be met for borrowers to purchase again without a waiting period.

 

Guidelines that must be met in order to purchase sooner than 3 years FHA

 

Borrowers are not eligible for a new FHA mortgage if they pursued a short sale agreement on his or her principal residence simply to:

1)      Take advantage of declining market conditions

2)      Purchase at a reduced price a similar or superior property within a reasonable commuting distance

WARNING: Short Sales…love em or hate em…they are here to stay! Go beyond the basic ‘expert’ short sale designation. Watch the FREE 2012 Agent Short Sale Secrets video and download the FREE Short Sale training guide.NOTICE: Free book guaranteed for the first 100 agents only.

3)      All mortgage payments due on the prior mortgage were made within the month due for the 12 month period preceding the short sale

4)      All installment debt payments for the same period were also made within the month due

Borrowers in default of their mortgage at the time of their short sale (or pre-foreclosure sale) are not eligible for a new FHA mortgage for three years from the date of the pre-foreclosure sale.

 

As you may have determined already from reading these guidelines that interpretation is subjective to how an underwriter views a borrower’s reasoning and motivation. It is prudent to secure loan approval prior to making an offer on any property.

 

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HARRIS REAL ESTATE UNIVERSITY Superstar Interview.

We have something special for you for this week’s HREU Superstar Interview.

(Listen to past HREU Superstar Interviews HERE)

One of our all time favorite lead generation tools is a  1-800 lead capture IVR system. This sort of ‘technology’ has been around since the mid 90s and its proven to be one (if not THE) best lead generation tool ever created for agents who are serious about making money.

Years ago when Julie and I sold real estate in Ohio we used very similar 1-800 number IVR lead-capture services…we started with ARCH and then moved to Proquest. Both were great services but had one glaring problem……

…..they are WAY TOO expensive. (and STILL ARE) It is not uncommon for agents to pay 0s if not 00s of their hard earned dollars per month for a lead capture 1-800 number (technically called ‘Interactive Voice Response’ system)

Not the case with 1800HomeHotline.com. When 1800HomeHotline.com contacted us for an endorsement I said we would provided they follow these simple rules:

1) The system had to be inclusive. ALL the bells and whistles. For example, I wanted a service that would have a ‘virtual brochure’ option…

2) Their service must use the latest interactive text technology…

3) Absolutely no per lead fee or per listing fee…no limits on how many listing an agent could have on the system..

4) NO contracts, cancel at anytime….no BS start up fees…

and perhaps the most critical requirement..

5) The service had to cost an agent NO MORE than per month.

Honestly, when I listed all of my requirements I had absolutely no expectation that they would follow up. After all, the least expensive competing service is well over 0 per month. How could the tech dudes at 1800HomeHotline.com possibly meet (let alone exceed) my expectations?

Well, they did.

Even better the 1800HomeHotline.com system is only per month. TOTAL…no hidden fees or surprises.

Bottom line, if you are using ARCH, Proquest or any of the other similar services you need to take a serious look at what 1800HomeHotline.com has to offer.

Check out this video I helped 1800HomeHotline.com put together. This video gives you an idea of just a few of the things you can do with their system.

Oh, one last thing….the first 30 days is FREE!

FREE 30 Day 1800HomeHotline.com Real Estate Lead Generation System.



FREE 30 Day 1800HomeHotline.com Real Estate Lead Generation System.

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Harris Real Estate University Daily Motivational Message. Listen in as Tim and Julie Harris share ways for top agents around the world to stay motivated everyday.


Harris Real Estate University Students (and future students) your home work from today’s Daily Motivational Message:
1) Go to 1800HomeHotline.com
2) HREU Special offer: Sign up..first 30 days is FREE, no contracts, you can cancel at anytime.

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When you buy real estate, it’s very exciting. First, you shop until you find your dream home (or maybe your dream home minus some bedrooms and closets). Then, you write possibly the biggest check of your life.

What is it? What happens to it?

It’s Not Actually a “Down Payment”
Because it’s the first money that a buyer puts “down” against the purchase, buyers often refer to it in slang as the “down payment.” That’s not technically correct, mostly because a purchase might involve more money down later. For example, you might buy a 0,000 house and hand over 5 percent of the purchase price (or ,000), when you sign the contract, and then put another percent down at closing, so that your entire down payment is ,000, in addition to the fact that you’re handing the seller a mortgage for the last 90 percent.

WARNING: Short Sales…love em or hate em…they are here to stay! Go beyond the basic ‘expert’ short sale designation. Watch the FREE 2012 Agent Short Sale Secrets video and download the FREE Short Sale training guide.NOTICE: Free book guaranteed for the first 100 agents only.

[Related: Read The Fine Print: Understanding Real Estate Contracts]

How to Handle That “Earnest Money”
So technically, that check that goes with the contract is known in the trade as “earnest money” (because it’s used to prove that you’re very, very earnest about buying this property) or the “contract deposit.” You don’t, however, want to just hand it over. It should go into a special account, known as an escrow account, which is held by the seller’s lawyer.

Where Does the Money Go?
It varies by state. In my state, real estate contracts even have a special clause to tell you what bank the seller’s lawyer is using to hold the escrow. In California, all the other money in a real estate transaction, even the mortgage, goes through escrow, too (but that’s not the way it is in most states). More typical is that the earnest money stays in escrow until the deal closes — and you own the house or apartment.

[Related: How Banks Decide How Much to Lend You]

If Something Goes Wrong, Do You Get Your Money Back?
Well, that depends on the terms of your contract. Your contract — which you should read carefully, even if you are also hiring a lawyer to read it — should outline in what scenarios your earnest money is forfeited, and in what scenarios you would get it back.

Typically, you might get it back if:

In other words, you can’t just cancel your contract on a whim. There are probably secondary provisions that keep you from “throwing” the deal — for example, if you have a financing contingency, then you wouldn’t have to go through with the purchase if the bank doesn’t give you a mortgage loan. But, there are probably contract provisions that state that you have to apply seriously and give the bank the income documentation and financial records that it asks for.

The NC Realtors “Realtor Report” cites a case where the buyer thought she was getting an FHA loan, and then found out that the FHA wouldn’t finance in the condo building where she was trying to buy. You might think that’s not her fault, but she still lost her deposit because she didn’t do enough research.

So, (I said this above but it bears repeating) read your contract. The huge amount of money you save may be your own.

More from LearnVest:

 

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Source: Monroe Real Estate.com

It’s tough to resist the entertainment factor in those reality TV shows like “Flip That House.” But here’s a little secret you may not know: Not everything on TV is as it seems.

In fact, I would guess that based on my experience of watching people try and flip properties for profit, 90 percent who try it once never attempt it again.

I’m not saying it isn’t possible for this to be profitable, and I know people who do it full time and do make money at it. But the odds are highly against the average person succeeding. However, if all those reality TV shows have piqued your interest, here are a few items to consider if you want to attempt this strategy.

Buy Low, Sell High
First, you will have to buy a property at significantly below market value or sell it above market value to make money. If you buy it and sell it at the market, you will lose money due to commissions, time, and renovation costs. So your best bet is buying a property below market value. That’s not simply below what it sold for four years ago, it’s below what is the current market value after taking into account all the distressed property sales in the area. And if it’s a decent property, you’re probably going to be fighting many other individuals trying to buy the same house. And when lots of people are vying for one piece of real estate, the price gets bid up and you probably are going to pay market value.

Recouping Value
What about adding value with a renovation? While there is no question you can add value by renovating a property, you probably will not add more value than the cost of that value. (Check out the Hanley Wood estimator, especially “cost recouped” column.) You might put in a ,000 kitchen that only adds ,000 in value. More than likely you will go way over budget on the rehab and spend way more than the value you add.

WARNING: Short Sales…love em or hate em…they are here to stay! Go beyond the basic ‘expert’ short sale designation. Watch the FREE 2012 Agent Short Sale Secrets video and download the FREE Short Sale training guide.NOTICE: Free book guaranteed for the first 100 agents only.

Transaction Costs
Another tough challenge is the costs on both sides of your flip. There are significant transaction costs on the buy and sell. Probably 3-to-5 percent in costs when you purchase property, and up to 10 percent when you sell property. So you really need to sell the property — and this is without regard to any rehab costs or holding costs — for about 20 percent greater than you paid. That’s just to break even.

Those holding costs also come into play. You may think you will resell the property in three months, and you might. But what if it takes six months, or nine months. You will be making mortgage payments, property tax payments, insurance, some maintenance, HOA fees, and all other kinds of costs as you hope to get the property sold quickly. And they add up, wait until you are the one writing the checks each month.

Fuzzy Math on This Flip
An individual I knew bought a property for 0,000 and sold it for 0,000, netting ,000 in six months — so he told me. Then we talked about the costs involved. Purchase and finance costs, including ,000 for rehab costs; ,000 for holding costs; ,000. He was up to ,000 in costs before he even transferred title to the new owner. Sales costs added about ,000 and he gave the buyer a ,000 credit, too. That added another ,000 in costs.

Here is the revised math on his flip: Sale price was 0,000, less total costs of ,000 (,000 + ,000), less his 0,000 purchase left him with ,000 in profit for six months of work. So much for the ,000 profit.

This result is more typical with profit-making real estate deals. Some people do score on short term, get-rich=quick attempts. Most of them are doing it full time and taking significant risks with their investing choices.

Luckily. the guys flipping properties on TV are making a living producing TV shows and getting paid by advertisers. That means their house flipping is more theater than business. There’s a much better chance they will make a living that way then trying to actually flip properties for a profit.

 

Leonard Baron, MBA, CPA, is a San Diego State University Lecturer, a Zillow Blogger, the author of several books including “Real Estate Ownership, Investment and Due Diligence 101 – A Smarter Way to Buy Real Estate.” Read useful tips for real estate buyers in his blog, Making Smart and Safe Real Estate Decisions. See more at ProfessorBaron.com.

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9361 Farralone Ave, Chatsworth CA
For sale: million

It’s the perfect place for a rendezvous.

Set 40 miles outside of Los Angeles and abutting a 3,000-acre nature preserve, a striking modern glass house coined the Farralone Estate summons the scenic privacy of a Hollywood set.

The only way you can see the grounds is by helicopter, says listing agent Lynn Teschner, adding some extra drama to the plot: “And when you’re there, you’re on top of the world.”

The home was remote enough to entice Marilyn Monroe and John F. Kennedy to meet there, or so the story goes.

Rat Pack Parties

Monroe never owned the home, but when Frank Sinatra leased the property, she was a frequent visitor to Sinatra’s notorious Rat Pack parties and occasionally stayed in the home’s guest house. And when she stayed there, rumor is that she had a frequent presidential visitor.

While Marilyn Monroe historians have not confirmed that this was the location for Monroe’s trysts with JFK, the house was a Hollywood party house from the moment it was constructed.

WARNING: Short Sales…love em or hate em…they are here to stay! Go beyond the basic ‘expert’ short sale designation. Watch the FREE 2012 Agent Short Sale Secrets video and download the FREE Short Sale training guide.NOTICE: Free book guaranteed for the first 100 agents only.

The home was commissioned by Dora Hutchinson, the heiress to the Chase Manhattan Bank fortune. At the time, celebrities building ranches in Chatsworth included Roy Rodgers and Lucille Ball. However, Hutchinson didn’t want a ranch.

“She wanted a glass house and she wanted it built by someone who built buildings,” explained Teschner.

The home was designed by architects Pereira & Luckman, best known for their work on the Los Angeles County Museum of Art and city plan for Beverly Hills. The entire property is 13.5 acres, with the main house of the estate comprised of a 10,000 sq. ft. set on 5 acres, including two acres of rolling lawn. The main residence sits up a long, winding private road and contains 4 bedrooms and 5.5 baths, a grand gallery and three lower level private offices complete with a conference room.

There is also a 1,000 square-foot guest house that contains one bedroom, 1.5 bathrooms and has its own pool. An additional 9.5-acre section, out of site from the residence, has a tentative tract map divided into 13 lots and is currently used as a vineyard with horse riding trails. In addition to the large motor court there is parking for 200 cars.

“They built 50 percent of the home out of glass that have withstand the test of time,” said Teschner. “It was a complete architectural feat to build and it cost a fortune.”

Celebrities included Lucy and Ava

Despite the cost of the home, Hutchinson only lived in the Chatsworth home for a few years, in which she threw parties that attracted celebrities ranging from Lucille Ball to Ava Gardner. Then she mysteriously left, moving to New York.

Frank Sinatra then leased the home for a decade, hosting his own parties with the Rat Pack, but after he left, the home remained empty.

When the current owners bought the property, it was in “disarray,” said Teschner. “They restored it to its pristine, original condition.”

The home’s interior retains its Mid-Century charm, complete with all period furniture. Its location and history have continued to attract Hollywood.

The list of celebrities and studios using the studio is varied, from the shoot for singer Usher’s music video “Burn,” to the filming locations of “Dream Girls” to the location of a Emmy-winning episode of “Mad Men.”

While the home isn’t being sold as a business opportunity, the home nets thousands of dollars a year, arranged by a property manager

Of course, with that kind of rental income, the sale price could be nicely offset. According to current mortgage rates, a monthly payment on the Ferralone Estate would be ,503, assuming a 20 percent down payment on a 30-year-fixed rate mortgage.

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Harris Real Estate University Daily Motivational Message. Listen in as Tim and Julie Harris share ways for top agents around the world to stay motivated everyday.


Harris Real Estate University Students (and future students) your home work from today’s Daily Motivational Message:
1) Go to 1800HomeHotline.com
2) HREU Special offer: Sign up..first 30 days is FREE, no contracts, you can cancel at anytime.

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Borrowers who faced foreclosure in 2009 or 2010 may be eligible for a free independent review of their foreclosures and they now have until July 31, 2012 to make a request for that review. The reviews which were ordered by the Office of the Comptroller of the Currency (OCC) and the Federal Reserve in April of 2011 cover foreclosures handled by most major loan servicers.

They are intended to determine whether borrowers suffered financial injury due to improper handling of the foreclosure action and, if so, how much compensation should be paid.

STOP and READ NOW: What do to the top 7439 REO Listing Agents in the US know that you don’t?Watch the FREE Agent REO Secrets video and download the FREE REO Training Guide. NOTICE: Free book guaranteed for the first 100 agents only.

OCC has mailed 4 million letters to likely eligible borrowers notifying them of this opportunity. Other borrowers who believe they are eligible for this review of their foreclosure can request application forms by calling (888) 952-9105.

Complete information about the Independent Review program can be found at:

www.occ.gov/independentforeclosurereview

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