2872 Fantail Lane - Lincoln (95648):  Don't miss seeing this great home in Twelve Bridges.  The home features 4 bedrooms, 3 full bathrooms in over 2,500 square feet of living space.  (more - virtual tour)

Offered by Julie Jalone at $574,900

Saturday and still talking short sales

This has been another busy week of dealing with short sales and lender negotiators so I am using Saturday to catch up a bit on my blogging. I just published my weekly column over at Rocklin & Roseville Today, “Getting Short Sales Done in Sacramento.” Check it out if you want to get a small taste of what it takes to negotiate a successful short sale.

We are continuing to be busy at MagnumOne Realty and are dealing with a nice group of buyer and seller clients. The market for homes priced under $300,000 is very active. Homes in that price range which show well are very hard to get into contract if you are representing the buyer. More often than not, they are getting multiple offers and being sold over the asking price. One of our agents who was showing homes priced around $200,000 has made seven offers over the past month for the same buyer and is still looking. Buyers in the higher price ranges appear to be much more price sensitive. They won’t even look until they believe the asking price is a bargain but when the price is lowered to “bargain level” then they have to deal with other buyers and multiple offer situations. Hint to buyers (particularly on short sale listings): go look at homes that interest you regardless of the asking price. If you like it make an offer of what you are willing to pay. You may be surprised to get it accepted.

If you have any questions or just want to talk about short sales, buying or selling, call me at (916) 290-9339 or send me an email to juliej@jalone.com.

The picture in this post is one of several Michael took on Father’s Day when we discovered a field of sunflowers in Sacramento. If you want to see more click, Sunflowers on Father’s Day.

The Ugly Side of Short Sales

I have recently been writing about the benefits of short sales in my weekly column at Rocklin & Roseville Today which is also carried over at Sacramento Today. The column today was, “Sacramento Short Sales – Good for All.” I really do believe short sales are win-win transactions where more than just the homeowner and lender benefit but there is an ugly side of short sales too.

Our team at MagnumOne Realty has been successfully completing short sales for the past three years. We have worked with almost every lender, we know what we are doing, have a strong process and we believe have a great reputation for getting them done. When you read my column today and I explain the benefits to the lender in accepting a short sale you would have to believe that our job as Realtors in working with lenders would be easy. That is so wrong!

Dealing with the lenders can be a nightmare and we treated as the enemy by most. The employees we deal with at the lenders for the most part treat us as if we are stealing money from them and should not be trusted.

I do understand that lenders are only as good as their employees and with the growth of short sales they have not been able to keep up and many of their employees are swamped with work. We were recently told that when Bank of America took over Countrywide they increased the file load on the short sale negotiators by more than 100 percent. Each negotiator now must follow 350 files. It doesn’t take a rocket scientist to figure out not much time can be given to a request.

Our experience with BofA/Countrywide is horrible. They misplace faxed information; they make you wait on hold when you call to get updates, of which they generally don’t have. They tell you not to call back until some date in the future that is beyond the trustee sale date and the thing that frustrates me the most is the inconsistent messages. We called to get an update on Monday and were told by the CSR that there were no new notes from the negotiator for the past 30-days so we could escalate the file to get attention. Naturally we agreed and were told to call back on Tuesday afternoon because it would take 24 hours to get a status update placed in the file notes. On Tuesday afternoon we called to get the update but were told escalations can take up to 48 hours and to call back tomorrow. On Wednesday, believe it or not, there was no update and we were told escalations can take up to five days so call back next Monday. Clearly their process is broken, there appears to be no effort to improve and it is almost impossible to find anyone who seems to care.

Some are better and a few even worse than BofA/Countrywide but the bottom line is most lenders have not figured out the cost/benefit of short sales and lose money every day by not adding staff and resources to their short sale departments. It makes our job of helping them and our client much more difficult.

If you are a Realtor or someone who deals with lenders on short sales, I’d love to share your stories here. Send them to me at juliej@jalone.com. Later this week I’ll write about some of the other lenders worse than BofA and a strange process at Wells Fargo.

Short Sales as a Financial Tool

With local schools getting out for the summer this and next week we should see an increase in the already busy Sacramento real estate market. Unfortunately much of this will be more short sales as more and more homeowners who owe more on their homes than they are worth realize getting out from under the debt and starting over makes sound financial sense. Homeowners who used 100 percent financing options or refinanced to pull all their equity out a few years ago are beginning to understand that it may be years before their house is worth what they owe. Add to this a financial hardship such as loss of a job or divorce and you have the perfect ingredients for a short sale and a fresh start.

If you or someone you know owns a home and owes more than the current value of the property give me a call at 916 290-9339 or drop me an email to juliej@jalone.com. We may be able to help you.

Over the past month there has been a consistent rumor floating around saying there is a huge number of bank owned properties that have not come to the market but will in June. Check out my column, “Rumors dampen Sacramento area Real Estate” over at Rocklin & Roseville Today for the details.

Getting Help to Achieve the American Dream

The first-time home buyer tax credit of up to $8,000 can be a significant help during the remainder of 2009 for buyers who have not owned a home in the previous three years. Check out my column, “First time home buyer’s tax credit,” over at Rocklin & Roseville Today for the details of the program. I believe this is a good program and will help not only to revitalize our Sacramento real estate market but will help buyers get their first home.

Sacramento Short Sales

We are beginning to see short sale junior lenders flexing their muscle. A year ago you could count on the junior lender to pretty much roll over and take whatever allowance the senior lender allotted to them for their lien release. Now, they are holding out for more money and most are asking for the borrower to sign a letter saying they will remain responsible for any shortfall amount.

Trying to help struggling Sacramento homeowners avoid foreclosure by modification of their mortgage or a short sale is more difficult than it should be. Every time the government comes up with a program or an incentive the lenders quickly figure out how to get the money without helping the borrower and essentially avoiding the primary objective of the program, which is to help the homeowner.

We are continuing to do our best to help homeowners avoid foreclosure but it is taking more time, energy and all of our experience to make it work. If you or someone you know is having trouble making their monthly mortgage have them call us soon if they are behind in their payments.

Worst to best with a flaw

Two years ago when a client told me they wanted me to short sale their home and their lender was Wells Fargo, I would visibly cringe. Dealing with Wells Fargo in those days was a nightmare. They didn’t have sufficient staffing to handle the requests, their process was weak and it took so long that when you got the approval the buyer had moved on so you had to start all over and nobody at Wells cared. Today they are one of the fastest, they make status update calls to you and often you can deal with the negotiator through email.

There flaw is bizarre. When they have more than one loan on a property they have not figured out how to let one negotiator manage their interest. You have to deal with two different departments, each with their own interest so they double the work for themselves and believe it or not the junior lien holder part of Wells Fargo often kills the deal because they demand more money than the other department is willing to pay for the lien release. They should be embarrassed!

If you want to read more about short sale negotiations, check out my weekly real estate column, “Getting Short Sales Done,” over at Rocklin and Roseville Today and reprinted at Sacramento Today.