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Redfin's Free Short Sale Class - Seattle
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Redfin's Free Short Sale Class - Seattle

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  • Realtytrac.comIs your area’s foreclosure rate as high as state and national averages?
  • Realtytrac.comWhat impact do interest rates have on foreclosure activity?
  • Realtytrac.comForeclosure Activity by MonthHow is each foreclosure stage trending?More info6 Month TrendFalling
  • BATNA – back up plan, have one to avoid feeling like you have no option except to take the offer
  • Research needed to understand the Auction process better
  • Chart:http://www.mortgagenewsdaily.com/mortgage_rates/charts.aspPrediction:http://www.bankrate.com/finance/mortgages/mortgage-rate-trend-index.aspx
  • Chart:http://www.mortgagenewsdaily.com/mortgage_rates/charts.aspPrediction:http://www.bankrate.com/finance/mortgages/mortgage-rate-trend-index.aspxWill rates rise or remain relatively unchanged? Experts and Bankrate analysts predict where mortgage rates are headed over the next week.This week (July 5-11), 31 percent of the panelists believe mortgage rates will rise over the next week or so; 38 percent think rates will fall; and 31 percent believe rates will remain relatively unchanged (plus or minus 2 basis points). Read more: Rate Trend Index - Mortgage Rate Trends - Bankrate.com http://www.bankrate.com/news/rate-trends/mortgage.aspx#ixzz2097YRlM8
  • Transcript

    • 1. Slide 1 of 32Distressed Properties &Short SalesPresented by: Tami RitochMay 30, 2013 Seattle, WAFollow: @RedfinSeattleLike: http://www.facebook.com/RedfinSeattle
    • 2. Slide 2 of 32Geographical Comparison – King County
    • 3. Slide 3 of 32Types of Distressed Homes● Short Sales► AKA: Pre-foreclosure► Potential vs. Approved Short Sale● Foreclosures (Post-County Foreclosure)► AKA: Bank-owned, REO, lender owned► Fannie, Freddie, Ginnie & HUD● Auctions● Estate Sales
    • 4. Slide 4 of 32Short Sales● How does a short sale work?● Parties involved (see chart)● Qualifying the short sale● Short sale approval process (see chart)● Timelines (Contingencies and Closing)● False contracts● Approval notice
    • 5. Slide 5 of 32The Life of a Short Sale● Searching for short sales● Market statistics● Negotiations and research● Sit and wait, finally explained● Getting a loan● Home inspections and warranties● Getting a clean title
    • 6. Slide 6 of 32Foreclosure Activity and 30-Year Interest Rate – King County
    • 7. Slide 7 of 32Foreclosure Activity by Month – King County
    • 8. Slide 8 of 32Short Sale Tid Bits● The rumor mill (old market)● Types of loans and liens► Get the Prelim! (and read the fine print)● 15% Redfin Rebate on Short Sales● Questions to ask before writing an offer
    • 9. Slide 9 of 32Picking 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 value
    • 10. Slide 10 of 32Moving 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?
    • 11. Slide 11 of 32Sit and Wait, Finally Explained!● The short sale approval process (chart)● Parties involved (chart)● Types of liens● Getting updates► Frequency and quality● Approval Notice
    • 12. Slide 12 of 32Short Sale PartiesShort SaleTitleEscrowOfficerEscrowAssistantSellersAttorneyBuyersHomeInspectorsAppraiserBuyer’sLenderUnderwriterInvestorGuidelinesBank #1CustomerCare CenterShort SaleDepartmentBPOAppraiserNegotiatorLitigationMortgageInsurerMortgageInvestor #1MortgageInvestor #2ClosingDepartmentBank #2CustomerCare CenterShort SaleDepartmentBPOAppraiserNegotiatorLitigationMortgageInsurerMortgageInvestor #1MortgageInvestor #2ClosingDepartment
    • 13. Slide 13 of 32Short Sale Approval Process
    • 14. Slide 14 of 32Bank Owned Homes● Contracts● Addendums● Timelines● Home condition● Listing agents● Tenants
    • 15. Slide 15 of 32Why Buy a Bank Owned?● Best price● Not afraid of a remodel● Comfortable with contracts● Financially strong with liquid capital
    • 16. Slide 16 of 32Buying at Auction● County Auctions (steps)● Organized Auctions● Who buys homes at auction?● What types of homes are at auction?● What are the prices like?● What is involved with buying at auction?● What is an absolute auction?● Due Diligence prior to auction● Tip - Write down your Max-bid
    • 17. Slide 17 of 32Searching forDistressed Homes
    • 18. Slide 18 of 32Finding Distressed Homes● Redfin► Shadow Inventory► Foreclosures (bank owned)► Short Sales● Government Sites► Homepath.com and Homesteps.com► Hudhomestore.com► IRS● Look down the street
    • 19. Slide 19 of 32The Offer & The Deal
    • 20. Slide 20 of 32Negotiation Strategies - SS● Recognize pricing strategy● Ask lots of questions● New listing● Old listing● Pre-approved short sale● Team up with listing agent● Meet the sellers● Be realistic
    • 21. Slide 21 of 32Negotiation Strategies - REO● Round 1► New listing► 30 days old► Price Reductions► Keep it clean● Round 2► Repairs Health and safety Lender Required Repairs
    • 22. Slide 22 of 32Title and Closing● Title Search► Chain of title► Last minute liens► Title insurance Lender’s Policy Owner’s Policy● Closing Paperwork● Possession and keys
    • 23. Slide 23 of 32Financing
    • 24. Slide 24 of 32Financing Options● Conventional loans► 30 year, 15 year, 5/1 ARM, etc● FHA► FHA health and safety requirements► Flipping guidelines● Rehab loans (203k)● Homepath loans
    • 25. Slide 25 of 32Financing Steps● Preapproval● Select property► What is condition of property?► Flipping guidelines● When to lock in the rate► Short sale► Bank owned● Mortgage process
    • 26. Slide 26 of 32Where Are Rates Headed?Type of Loan May 16, 2013 May 23, 201330-Year Fixed 3.51% 3.59%15-Year Fixed 2.69% 2.77%5/1 ARM 2.62% 2.63%1-Year ARM 2.55% 2.55%
    • 27. Slide 27 of 32Where Are Rates Headed?
    • 28. Slide 28 of 32Home Inspections
    • 29. Slide 29 of 32Home 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 defects
    • 30. Slide 30 of 32Home Inspections● Most common concerns► Roof► Structural► Plumbing► Electrical► HVAC► Deferred Maintenance► Termites► Mold► Cosmetic
    • 31. Slide 31 of 32Home Warranties● What is a home warranty?● What is covered?● What is excluded from coverage?● Benefits of a home warranty● Managing the risk of unexpected repairs● As-is, what can be covered?● Pre-existing conditions► Known► Unknown● Home inspections and warranty coverage
    • 32. Slide 32 of 32Thanks for Coming!Please fill out the survey that will be sent to you along with thedeck! We appreciate the feedback!Our next class:Loan Programs for 1st Time Home BuyersJune 11, 20136:00pm – 8:00pmCobalt Mortgage617 Eastlake Ave E.Seattle, WA 98109http://www.redfin.com/events