Ballard short sales class 3.27.12

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Ballard short sales class 3.27.12

  1. 1. Short Sales – Start to Finish Presented by James Redmond Jr.Slide 1 of 21
  2. 2. The Life of a Short Sale ● How to grow a short sale ● Getting a short sale listed ● Picking your team ● Searching for short sales ● Market statistics ● Negotiations and research ● Sit and wait, finally explained ● Getting a loan ● Home inspections and warranties ● Getting a clean titleSlide 2 of 21
  3. 3. How to Grow a Short Sale ● Supply vs. Demand ● 80/20 Loans ● HELOCS (disappearing money) ► Recourse in a Non-recourse state ● Market crash ► 50% drop in home values ● Making the decision to short sale ► Loan modifications ► Bankruptcy ► Credit ImpactSlide 3 of 21
  4. 4. Foreclosure Activity and 30-Year Interest Rate - SeattleSlide 4 of 21
  5. 5. Geographical Comparison - SeattleSlide 5 of 21
  6. 6. Foreclosure Activity by Month – SeattleSlide 6 of 21
  7. 7. Getting a Short Sale Listed ● Seller’s mindset ► Home maintenance ► HOA dues ● Bank’s attitude ● Listing agent’s struggle ● Pricing strategies ► Some things are too good to be true ● Approval Notice complications ● Trustee’s sale dateSlide 7 of 21
  8. 8. Picking Your Team ● Qualifying Your Realtor ► Experience, education, designations ► What does it mean to you? ● Qualifying Your Lender ► Rates are just the beginning ► New lender pay compensation ● Partner Lenders ► A hidden valueSlide 8 of 21
  9. 9. Searching for Short Sales ● Active, AWC and Pending ► What do they really mean? ● Accurate and reliable websites ● AWC, Pending and Sold stats ● Pre-foreclosure lists ► What are they?Slide 9 of 21
  10. 10. Moving Forward…● Writing the Offer ► Tips, tricks, pointers ► Low and Low Method● Youre Under Contract, Now What? ► Sit and wait… and wait… and wait… ► Do an Early Home Inspection ► Revisit the home, occasionally● Approval Process ► What’s involved? ► Approval Letters and Transferability● What If… ► House gets trashed ► Critical items are missing to qualify for the loan ► What leverage do you have?Slide 10 of 21
  11. 11. Sit and Wait, Finally Explained!● The short sale approval process (chart)● Parties involved (chart)● Types of liens● Getting updates ► Frequency and quality● Approval NoticeSlide 11 of 21
  12. 12. Short Sale Parties Short Sale Bank #1 Title Customer Short Sale Litigation Care Center Department Escrow Officer BPO Mortgage Appraiser Insurer Escrow Assistant Mortgage Negotiator Investor #1 Sellers Bank #2 Mortgage Investor #2 Customer Short Sale Attorney Litigation Care Center Department Closing Buyers Department BPO Mortgage Home Buyer’s Appraiser Insurer Appraiser Inspectors Lender Mortgage Negotiator Investor #1 Underwriter Mortgage Investor Investor #2 Guidelines Closing DepartmentSlide 12 of 21
  13. 13. Short Sale Approval ProcessSlide 13 of 21
  14. 14. Getting a Loan● #1 Question ► Credit inquires and FICO scores● Pre-qualification vs pre-approval● Changing underwriting guidelines● When to lock your interest rate ► Short sales● Loan Options ► Conventional, FHA, Rehab, HomepathSlide 14 of 21
  15. 15. Current Average RatesType of Loan March 15, 2012 March 22, 201130-Year Fixed 3.92% 4.08%15-Year Fixed 3.16% 3.30%5/1 ARM 2.83% 2.96%1-Year ARM 2.79% 2.84%
  16. 16. Where Are Rates Headed?Slide 16 of 21
  17. 17. Home Inspections● What to look for yourself● Missing components ► Big ticket items (AC, cabinets, appliances) ► Deliberate damage & safety (electrical)● Severe neglect● What an inspector won’t find and won’t test ► Hidden defects ► Untested system defectsSlide 17 of 21
  18. 18. Home Inspections● Most common concerns ► Plumbing ► AC ► Maintenance ► Termites ► Fresh PaintSlide 18 of 21
  19. 19. Home Warranties● What is a home warranty?● What is covered?● What is excluded from coverage?● Benefits of a home warrantySlide 19 of 21
  20. 20. Home Warranties● Managing the risk of unexpected repairs● As-is, what can be covered?● Pre-existing conditions ► Known ► Unknown● Home inspections and warranty coverageSlide 20 of 21
  21. 21. Title and Closing● Getting a clean title ► Last minute liens ► Title insurance● Mortgage Electronic Registration System● Recording Process● Keys!Slide 21 of 21

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