Santa Clara Valley Living » Short Sales

Santana Row Loft Successful Short Sale – Sold $515K

vbrasil — Sat, 22 Aug 2009 15:29:29 +0000

333 Santana Row #214, Sold for $515K. 1 Bedroom 1.5 Bath loft with catwalk, popout, large back patio, and 2 parking spots, great deal.

This short sale transaction just closed last week. For those of you who who are considering buying a short sale understand that the most important figures in the transaction are the negotiators, the listing agent, and the buyers agent, and the most important quality they must all poses is diligence.

Short sales are all about paperwork whether the paper work is the short sale package, lender addenda they need to be completed correctly or to the negotiators satisfaction and they need to be submitted in a timely fashion. Its my contention that a short sale can close quickly in 6 weeks, as long as the agents and negotiator are diligently meeting the negotiators request and submitting the paperwork in a timely fashion.

This particular short sale had two loans which made the agent’s diligence even more important and crucial. You have to satisfy the paperwork for two loans, but the complex issue is that the 2nd loan approval cannot be granted until the first is granted. Once the first loan has short sale approval they will offer funds to the second, the agent must find out from the 2nd loan what amount they will request in order to release their lien, and do that before the 1st loan approval expires.

With all the confusion and uncertainty its incredible that these transactions even close, but they do and its my impression that they are not that bad, and do close. The only frustration I feel is the uncertainty and the possibility of being thrown out of contract by a higher offer from another buyer. This can easily happen, be sure to read your addenda and understand the nature of your contract.

In the end because of the buyer’s patience, she got a great deal on this loft. It was really a great property, and I really enjoyed the feeling of being in this property.Similar Posts:

Santana Row Loft For Sale – Short Sale

vbrasil — Wed, 22 Apr 2009 02:55:28 +0000

Great Santana Row loft with spacious exterior patio. This unit features a one bedroom one and a half baths and den. Open living area with dramatic 22 foot tall ceilings and large windows. Unit also features an extra dedicated parking spot and custom paint. Check out the slideshow for the contemporary decor.Similar Posts:

Rivermark, Santa Clara NOD – Notice of Defaults

vbrasil — Wed, 18 Mar 2009 16:23:39 +0000

Currently Santa Clara has 194 Notice of Defaults filled on properties. A notice of default gets filed on a property in Santa Clara County when the owner is behind on the mortgage by 2 or 3 months. This is the first stage of the foreclosure process referred to as pre-foreclosure.

Rivermark Townhome Short Sale

In order remove the notice the owner must make the home current and pay back the mortgage owed.

Newer developments have seen a higher rate of defaults due to the recent sales within the last 5 years of these homes. Home owners are unable to refinance their properties since many owe more than the current market values.

In Rivermark alone there are several short sales and 11 homes that have notices of defaults filed and 7 condo’s in the Miraval Complex. Many of these Rivermark home owners have already engaged in trying to sell their home as a short sale. Others may be attempting to renegotiate with their banks to stay in their houses, others perhaps bracing for foreclosure.

When confronted with this reality the homeowner needs to contact their bank and try to work out a resolution. This is where your persistence will pay off. Lenders seldom give any concessions to anyone let alone a debtor, but if you are persistent and can show hardship and willingness and ability to pay you should be able to modify your loan.

The other avenue is to sell your home short. The process is similar. The bank wants to know your financial situation before it can agree to any deficiency sale. Essentially you have to prove you can no longer afford your home or that you are forced to sell due to relocation or some other factor.

Both of these options have become more viable to home owners, so their is no reason why homeowners should be foreclosing these days.

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Rivermark Santa Clara- REO’s & Short Sales

vbrasil — Sun, 15 Mar 2009 18:04:39 +0000

It’s no surprise that any newer developments in the Santa Clara County as of the past 5 years are going to experience a high number of Short Sales and REO or Bank Owned properties. Rivermark in Santa Clara is no exception.

Rivermark Townhome Short Sale

Rivermark is a master planned community developed in 2002 by Lennar, Centex and Shea Homes encompassing over a 1500 single family and town home units. Also around the Rivermark development is the Miraval Homes Luxury condo development and Mission Gardens single family homes, townhomes, and condo’s.

Many of these units have resold in the last few years since their initial releases, leaving some home owners at peak prices resulting in short sales and no opportunity to refinance.

Currently in the Santa Clara Rivermark location there are 14 condo short sales and 1 bank owned condo. There are no single family short sales or REOs at the moment.

Miraval Condo

A good portion of these short sales are in the Miraval Condominium Complex. Miraval is a Luxury condo complex providing nicely appointed units with great amenities in the complex. Currently there are 5 short sale units for sale in Miraval. One bedroom units starting at $280K and 2 bedroom units at $400K.

As for the Rivermark development currently there are only townhomes availables. Which says alot about Rivermark and the fact that the single family home values have not been hit too hard. Many times buyers offten ask what is a better investment a townhome or a single family home. As you can see single family homes rarer in Rivermark have held up very well so var with all the market pressures.

For a list of active short sales and bank owned properties in the Santa Clara Rivermark area follow the link below.

Rivermark Short Sale TownhomesSimilar Posts:

What are the differences between short sales, foreclosures, and REOs?

vbrasil — Tue, 10 Mar 2009 04:45:30 +0000

With the number of foreclosures skyrocketing in California in recent years, there is a lot of interest from would be buyers in purchasing bank owned properties which are also known as real estate owned or REOs.
What is a short sale?

What is a Short Sale?

Short sales occur when the value of the property is less than the encumbrances or liens on the property. The property is still owned by the owner and not the bank. It is being sold with the understanding that the total liens on the property will not be satisfied by the proceeds of the sale. Therefore the owner will need the lien holders approval to be able to sell the properety. This can take months to get approved, and may not end in a successful sale.

What is Foreclosure?

When a property is in foreclosure, the owner has stopped making payments and the lender has given the borrower a written Notice of Default that the payments must be brought up to date or the property will be sold off. The notice is a public document (which is why so many websites offer foreclosure lists). It normally takes about two missed payments for a lender to issue a Notice of Default, but not always.

Notice of Trustee’s Sale, after receiving a Notice of Default, the owners of a property allow their home to be foreclosed, then a Notice of Trustee’s Sale gets posted by the trustee. This is usually the trustee holding the primary note. In California, it’s not the bank that forecloses, it’s the Trustee.

Once the trustee decides to foreclose, it goes to a Trustee’s Sale. This sale is held on the courthouse steps in the applicable county. Usually, the bank buys its’ own property from the trustee for the full amount owed on the primary mortgage. In the current market, the price the bank pays to obtain the property is often more than market value. Any subsequent mortgage holders get nothing. The “courthouse steps” is typically not a good place for a potential end-user to buy the property – it’s geared towards investors who buy many properties at wholesale prices. In fact, it can be a downright unfriendly environment if you don’t know how the game is played.

What is an REO?

Once the bank has purchased the home, it is now foreclosed and is called an REO (Real Estate Owned). The bank will then usually list the property at or near full market value and place it on the local MLS.

Finally on the Market. At this point, it shows up on the MLS as an REO and your Realtor can show it to you. Once the bank purchases the home at the Trustee’s Sale and it’s now an REO, the bank tries to get as much for it as possible. The price usually goes back up to at or very near market price.

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Short Sale FAQ

vbrasil — Thu, 19 Feb 2009 16:08:53 +0000

FREQUENTLY ASKED QUESTIONS

SHORT SALES: THE LONG AND SHORT OF IT

1. What is a short sale?

A short sale* is a sales transaction in which the seller’s lender agrees to accept a payoff of less than the balance due on the loan. In addition to absorbing any loss on the loan, the lender in most cases agrees to pay the costs of the sale.

2. How long does the average short sale take?

It can take anywhere from 28 days to six months once the lender receives a signed offer from both the buyer and seller. The process frequently moves slowly. Currently, many lenders are working to revamp their system to speed up the procedure.

3. If a short sale transaction can take up to six months, why do they call it a “short sale”?

Clearly an oxymoron! Or look at it this way: the value is “shorter” than the loan amount.

The truth is, a short sale has multiple phases that may affect the transaction time frame. Depending on market trends, price positioning, and other factors, it can take anywhere from seven to 180 days or more for a property to sell. Once the negotiations are complete, the short sale proposal is sent to the lender who will evaluate it from a financial perspective. In addition, the homeowner must establish eligibility for the short sale by providing supporting documentation such as, W-2 forms, bank statements, tax returns, and other financial documents. Understandably, this process takes time!

4. Why would a lender agree to a short sale?

There are various reasons why a lender may agree to a short sale. For example, Senate Bill 1137 (which became effective in July 2008) imposes strict requirements on lenders prior to exercising their right to foreclose. Foreclosures take time, and as we all know, time is money.

The expense to the lender is another factor. Foreclosure costs may include: internal fees and expenses, eviction, repairs and maintenance of the property, security, as well as Home Owners Association (HOA) dues and utilities. These factors, combined with the federal and state government’s push to halt foreclosures, make it easy to see why a short sale may be in the lender’s best interest.

5. Is a short sale still an option if foreclosure has already taken place on my home?

No. Once the lender has completed the foreclosure process, a short sale is no longer an option. For that reason, it is vital that homeowners understand the importance of early communication with the lender. Don’t wait until it is too late. Speak to your lender, and let him or her know that you are having financial or other difficulties. If you want to retain ownership of your home, you may be able to work with your lender to explore alternatives to foreclosure.

6. I have a second mortgage on my home. Does this make me ineligible for a short sale?

In many cases, a short sale can be achieved on properties with multiple loans. Depending on the amount of the loss to the junior lien holder (second trust deed), a short sale may be possible under certain circumstances. Proposals and requests for short sale consideration should be submitted to both lenders at the onset.

7. Once I have an offer on my home, what happens next?

Your realtor will assist you in negotiating the best price and terms. Once the negotiations are complete, the offer and all supporting documentation should be packaged and submitted to the lender’s loss mitigation department. Follow-ups and ongoing communications are significant components of a successful short sale.

8. Will I have to pay capital gains taxes if I sell a property as a short sale?

A short sale has no bearing on the calculation of capital gains taxes. However, there are other tax liabilities that must be evaluated. Seek the advice of tax and legal advisors before agreeing to a short sale. For additional information, you may visit www.irs.org to learn more about taxation of short sales.

9. Will a short sale affect my credit?

Yes. Your tax advisor will be able to address your specific situation.

10. I would like to buy a short sale. Where do I start?

Choose a REALTOR® who has the ability to recognize a short sale property and who possesses the skill and training to work through any difficulties that may arise during the buying process. Be prepared for a bumpy road. If your REALTOR® is knowledgeable, he or she will help you manage your expectations.

11. When buying a short sale, do I have to pay all of the escrow fees?

The allocation of costs is a negotiable item in any real estate transaction. Typically, the buyer and seller each pay their own fees.

In short sales, lenders may request that certain fees be paid by the buyer, as a condition of the lender’s approval. Some of these costs may include: funds owed to junior lien holders, closing costs, delinquent property taxes, and Home Owners Association Dues. Expect the unexpected and work with a REALTOR® who understands short sales and can walk you through the process prior to preparing an offer to purchase.

12. How is Coldwell Banker Residential Brokerage simplifying and streamlining the short sale process?

Coldwell Banker Residential Brokerage has been working diligently on a multi-faceted program to educate its managers and sales associates regarding the intricacies of the short sale. In response to the unprecedented challenges today’s homeowners face, the company has developed a unique short sale package that allows Coldwell Banker sales associates to deliver comprehensive proposals to lenders, thereby increasing the likelihood of a successful and swift transaction.

13. How do I determine if I’m eligible for a short sale?

Homeowners must be aware of their options before considering a short sale. Other options include: loan modification/refinance, deed in lieu of foreclosure, foreclosure, and bankruptcy. There are many non-profit counselors available to advise homeowners on the advantages and disadvantages of each of these options. A complete list of counselors may be obtained at www.hud.gov

* When the amount of the loan and other costs of the sale exceed the current market value of the property, there are a number of options struggling homeowners may consider, including loan modification, deed in lieu of foreclosure, foreclosure, bankruptcy and short sale. Any homeowner considering a short sale should consult with legal and tax advisors. A complete list of non-profit counselors is available at www.hud.gov

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Snag a great deal on a short sale

vbrasil — Thu, 29 Jan 2009 15:47:28 +0000

(great article on short sales, very accurate assesment of the time and expectation. Although the article refers to the Sacramento area, the same opportunities are here in the Santa Clara Valley. -Vinicius)

Short sales – where a lender agrees to take less than it’s owed on a mortgage – are rising sharply. Here’s how you can profit.

January 28, 2009: 6:06 AM ET

(Money Magazine) — When Brian Gavitt, a physician, and his wife Gayleen, a stay-at-home mom, started to eye homes in Sacramento last winter, they knew they were looking in the hardest-hit areas of the housing bust. So the couple, who were relocating from Lansing, figured they could land a fantastic bargain in no time at all.

The part about the bargain turned out to be true. The Gavitts bought a five-bedroom house in the upscale Natomas Park neighborhood ("Even now, you don’t see FOR SALE signs up anywhere," says Gayleen.) And it was a steal at $300,000, a full $200,000 less than they would have paid just two years ago.

The amount of time it took to land the deal was another story. It was more than six months from when the Gavitts first saw their dream home to the moment they held the keys in their hands. The reason: The home they bought was a short sale.

Not along ago, few people had even heard of a short sale, which occurs when the bank agrees to discount the loan balance for a seller who owes more on his mortgage than the home is currently worth.

If you’re in the market for a home today, you’re almost guaranteed to be looking at some short sales. Nationwide, 14% of homeowners are currently underwater on their mortgages. And in many areas, it’s far more: In the Gavitts’ zip code, for example, over half of homeowners would owe more than their home is worth if they sold today, calculates Dee Schwindt, the Gavitts’ realtor.

The good news is that short sellers are likely to still be living in the home and some may even be current on their payments. That means these aren’t the run-down, distressed properties that you often find among foreclosures; in fact, there’s a good chance that some of the most deluxe homes for sale in your market are underwater.

Before you get too excited about buying a short sale, know that they generally aren’t, well, short. For the sale to go through, the seller’s lender must approve the price and agree to take the shortfall as a loss. That extra step can cause the process to drag on three times as long as a normal home sale.

But as the Gavitts discovered, the hassles can be well worth it. Some buyers and realtors don’t want to deal with short sales, leaving many choice homes with very few bidders. So if you’re willing to brave the intricacies of the process, you’ll be far more likely to land the home you always wanted. The key to snagging a good deal is knowing how to avoid the land mines.

Know what you’re getting into. In a short sale, you are dealing with several parties: the sellers, their agent and the sellers’ lender. That’s why a short sale can take anywhere between two and six months to execute, compared with about 30 days for a typical sale. Though many banks are willing to take a loss on a mortgage in a short sale if it means avoiding an even bigger loss in a foreclosure, with so many owners trying to unload properties, the lender’s negotiators are flooded with short-sale offers. So if you’re moving or selling another property, keep in mind that you’ll likely need to budget for a few months’ worth of rental payments so you have somewhere to live in the interim.

Find the right pro. Lenders often make realtors who work on short sales take a hit on their commission, so some brokers may be loath to show you the listings. But don’t even think about going solo. These deals take a lot of work and persistence, says Loni Parmelly, author of Success in Short Sales. Before you sign up with an agent, ask him how many short sales he’s closed. If he hasn’t done at least two, find someone more experienced.

Weed out candidates. In most cities, home listings will indicate in the description whether the property is a short sale. Ideally, you want to knock off ones that come with extra complexities. If possible, pass on any home that has more than one lien against it; having to negotiate loans with two lenders can greatly increase the amount of time it takes to complete the deal. Also avoid homes where the seller has other offers. That’s because if another offer is pending, the seller’s agent isn’t likely to even submit yours for approval until the first one is rejected, meaning you’ll have to wait for another negotiation to play out before you even get a chance.

Set the right price. The first step is to have your agent submit your offer to the seller. Don’t just rely on the current list price to come up with your initial bid, says Bill Richardson, a district sales manager for the Keyes Co. Realtors in Boca Raton, Fla. The seller’s agent may have far underpriced it in hopes of attracting buyers, but the bank likely won’t accept a lowball offer. Ask your agent to determine the home’s fair market value by searching comparable sales in the area, with an emphasis on other short sales and foreclosures. If the fair market value is lower than the list price, set your offer 10% lower than that.

At this point, you’ll also want to get pre-approval for a mortgage; many banks won’t even consider your offer if you don’t have one, says Schwindt.

Protect yourself. Next, the seller’s agent will submit your offer to the seller’s lender. At this point, you’ll be asked to sign a sales contract. See if the lender will agree to pick up all closing costs as part of the contract, says author Parmelly. Also ask your realtor to specify that you won’t do an appraisal or inspection of the property until the offer is approved. That way you won’t have to shell out hundreds of dollars until you know you realistically have a good chance of getting the home.

Finally, though most lenders will require you to make some kind of deposit along with the contract, don’t put down more than $3,000 before your bid is accepted. That will give you room to put offers on other homes or even to pull out of the sale if it drags on for too long.

Be a pain in the neck. After your offer is submitted to the lender, you’re likely to hear nothing for weeks, if not months. This is no time to relax. Call your agent at least once a week, and make sure the seller’s agent is contacting the bank’s negotiator nearly every day.

"These negotiators may have 400 files on their desk. They’ll want to get rid of the squeaky wheels," says Parmelly, who worked as a loan negotiator for lenders for 16 years. To help the seller’s realtor in her negotiations with the lender, it’s a good idea to have your agent show her which comparable homes you used to arrive at your number.

If the clock keeps ticking and you’re reaching the end of your rope, try playing hardball. After months, the lender the Gavitts negotiated with was still dragging its feet and their pre-approved loan rate was about to expire. "We said, ‘We need an answer by Friday or we walk,’ " Gayleen says. The bank responded by week’s end.

Keep your eye on the market. When the bank finally sends its counter-offer, use it as a guideline rather than an ultimatum. Most of the time, the lender’s number is based on its own research, that of a local realtor it hires and the outstanding loan balance. Usually its goal is to sell for at least 90% of the home’s value, says Amy Bohutinsky, a spokes-person for Zillow.com.

The lender’s offer may not be what you’d hoped for, but don’t despair: You have a chance to counter. If the market has been flat since your initial bid, try for 5% to 10% less than the bank’s number. If the market has been sinking rapidly, however, you may be able to prove that the home’s value has shrunk further and offer even less. Once you have the lender’s ear, the new offer should take less time to process.

Despite all the legwork and wait, the Gavitts are thrilled with their new home. "I’m glad people are turned off by short sales," says Brian. "It just means more choices for the rest of us."

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Santa Clara Home Short Sale

vbrasil — Tue, 27 Jan 2009 19:22:21 +0000

I just got my short sale listing 2122 Ventura Place in Santa Clara in contract. The sellers and I initially tried to sell the home where the sellers could possible come out clean without a short sale on their record. As the market deteriorated however, this proved to be an impossible venture and eventually we all agreed that this is the best course.

Now begins the time consuming task of working with the lender, in this case Countrywide Home Loans, to get the short sale approved. For those of you who are unfamiliar with short sale properties, short sale occurs when the proceeds from the sale of a home will not cover the loans or liens against the home. In this situation a seller, in order to sell the home, would have to bring money into closing or negotiate with the lien holders to take less than the amounts owed. The motivation for the secondary lien holders to negotiate would be to get some money as opposed to none. In the event of a foreclosure the primary lien holder would take title, and the property would become an REO or Bank Owned.

In many cases it is to the lender’s benefit to work with a short sale as opposed to waiting for the home to be foreclosed. This is assuming the seller’s are in default and have stopped paying the mortgage. This Santa Clara home has only one loan which makes the negotiation much easier than dealing with two two loans and possibly two separate lenders.

Now that I have received an offer I can submit it to the lender to get the short sale approved. I need to provide the lender a summary of the seller’s monthly earnings and expenses. In addition the lender will also need a copy of the purchase contract, estimated net-sheet, two months of pay check stubs and 3 months of bank account statements. This is referred to as the Short Sale Package, and different lenders require different items. Now that I have submitted the package, I will follow up tomorrow to ensure that they received it in its entirety, and wait for the approval. I will continue to update this blog as the transaction progresses.

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