Short Sales...
A short sale in real estate is not always a pleasant transaction.
There are many ways to lose a home but signing away ownership in a manner that destroys credit, embarrasses the family and strips an owner of dignity is one of the hardest. For owners who can no longer afford to keep mortgage payments current, there are alternatives to bankruptcy or foreclosure proceedings. One of those options is called a "short sale."
More than half of my sales in Sacramento over the past few years are short sales. That's how prominent short sales have become. A short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold.
 |
In a short sale, the bank or mortgage lender agrees to discount a loan balance due to an economic or financial hardship on the part of the mortgagor. This negotiation is all done through communication with a bank's loss mitigation or workout department. The home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender, sometimes (but not always) in full satisfaction of the debt. In such instances, the lender would have the right to approve or disapprove of a proposed sale. Extenuating circumstances influence whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market and the borrower's financial situation.
A short sale typically is executed to prevent a home foreclosure, but the decision to proceed with a short sale is predicated on the most economic way for the bank to recover the amount owed on the property. Often a bank will allow a short sale if they believe that it will result in a smaller financial loss than foreclosing as there are carrying costs that are associated with a foreclosure. A bank will typically determine the amount of equity (or lack of), by determining the probable selling price from a Broker Price Opinion BPO (also known as a Broker Opinion of Value (BOV)) or through a valuation of an appraisal. For the home owner, advantages include avoidance of a foreclosure on their credit history and partial control of the monetary deficiency. A short sale is typically faster and less expensive than a foreclosure. In short, a short sale is nothing more than negotiating with lien holders a payoff for less than what they are owed, or rather a sale of a debt, generally on a piece of real estate, short of the full debt amount. It does not extinguish the remaining balance unless settlement is clearly indicated on the acceptance of offer.
Short sales are common in standard business transactions in recognition that creditors are not doing debtors a favor but, rather, engaging in a business transaction when extending credit. When it makes no business sense or is economically not feasible to retain an asset, businesses default on their loans (called bonds). It is not uncommon for business bonds to trade on the after-market for a small fraction of their face value in realization of the likelihood of these future defaults.
Foreclosures...
RESOURCES FOR FORECLOSURE INFORMATION
Avoiding Foreclosure - This page on the State Connecticut Department of Banking website discusses how to avoid foreclosure and includes resources regarding foreclosures.
Connecticut Foreclosure Assistance Hotline - This press release from Connecticut Governor M. Jodi Rell announces the establishment of a Mortgage Foreclosure Assistance Hotline. Connecticut’s residents who are facing foreclosure on their homes may call (877) 472-8313 toll-free and receive advice and guidance regarding their mortgage problems.
Connecticut Housing Finance Authority - This website contains information regarding Homebuyer Programs, Tax Credit Programs, Elderly Programs, Foreclosure Assistance programs, Rental Programs, etc. Click here to read a Q&A sheet on the CT FAMLIES program offered by CHFA. Over-the-phone assistance and referrals from CHFA are also available. Dial 860-571-3500 to speak with an operator who can help.
Foreclosure Prevention Help From Attorneys - The Connecticut Fair Housing Center's pro bono network of attorneys is accepting referrals. If you have clients who are delinquent on their mortgage payments or who have received a foreclosure notice, they can call Statewide Legal Services at 1-800-453-3320. The Center and Statewide Legal Services will find these clients attorneys who will provide legal assistance free of charge.
HELP FOR MILITARY FAMILIES FORCED TO SELL AT A LOSS - The massive economic rescue bill enacted into law last month includes a provision to help military families forced by deployment or other eligible circumstances to sell their houses at a loss in today's down market. Under the provision, the federal government will cover 95 percent of a loss. The law applies to service members with mortgages entered into before July 1, 2006. An online resource from the U.S. Department of Defense can help your members learn if their client is eligible for the assistance. For more info contact Megan Booth, 202/383-1222.
Internal Revenue Service - This page on their website includes questions and answers regarding home foreclosure and debt cancellation.
Partnership for Strong Communities - This page on their website contains resources for borrowers in danger of foreclosure.
Making Home Affordable - Visit this website for information regarding the Making Home Affordable Program February President Obama announced in February or call 888-995-4673. The program is designed to help up to 7-9 million families avoid foreclosure by restructuring or refinancing their mortgages.
Mortgage Assistance Tip Sheet - For homeowners in danger of foreclosure Senator Joseph Lieberman has added a list of several federal, state, and nonprofit resources to help homeowners refinance their loans.
National Association of REALTORS® - Visit this page of their website for numerous resources regarding foreclosure including the HOPE Hotline number, tips on how to avoid foreclosure, foreclosure programs by state, information regarding credit card counseling and smart financing and much, much more.
State of Connecticut Department of Banking - On this website you can verify licenses, search for a bank or credit union, find banking, securities and related statutes and regulations and find information regarding filing a complaint, etc.
U.S. Department of Housing and Urban Development - This page on HUD's website has information regarding avoiding foreclosure in Connecticut
Landlord/Tenant...
ent luptatum Lanlord/Tenant link below:
Connecticut Law About Landlord/Tenant Law
Publications from the Connecticut Judicial Branch:
REALTOR® is a registered trade mark which identifies a professional in real estate who subscribes to a strict Code of Ethics as a member of the local, state and National Association of REALTORS®.Our Greater Bridgeport Board of REALTORS® web site contains links to web sites that are maintained by other organizations and people.
We do not monitor the content on these sites and urge you to direct any complaints or concerns about
any content to the administrator or webmaster of those relevant sites.
Ethics...
Code of Ethics and Standards of Practice
of the National Association of REALTORS®
The Code of Ethics effective on January 1, 2008 may be downloaded
directly from National Association of REALTORS® website. Please click the link below to obtain a copy.
2008 CODE OF ETHICS
REALTOR® is a registered trade mark which identifies a professional in real estate who subscribes to a strict Code of Ethics as a member of the local, state and National Association of REALTORS®.Our Greater Bridgeport Board of REALTORS® web site contains links to web sites that are maintained by other organizations and people.
We do not monitor the content on these sites and urge you to direct any complaints or concerns about
any content to the administrator or webmaster of those relevant sites.
Rental Security Deposits...
Key Issues for Landlords and Tenants
Landlords, once you give the key to your rental apartment or home to a tenant, you must follow basic rules for security deposits.
Tenants, once you accept the key to your new home, you must also follow guidelines to protect your security deposit.
Connecticut law outlines the rights and responsibilities of both landlords and tenants about the collection, holding and return of rent security deposits. This publication answers common questions on rent security deposits. It's our attempt to help both landlords and tenants understand their obligations and Connecticut's law. You may wish to review Section 47a-21 of the Connecticut general statutes for more detailed information.
-- Howard F. Pitkin, Banking Commissioner
Buyers...
Homeownership remains one of the highest goals for many people because of its many benefits. Along with owning a home comes a sense of security and belonging that cannot be found elsewhere. For many, homeownership represents personal and financial success.
There is much personal satisfaction in living in a home that you own. A home is a valued investment that can have many financial advantages and tax benefits. The interest you pay on a home loan and the real estate taxes you pay on your home are among the few major federal tax deductions. Owning a home is the primary way most people build wealth.
Homeownership is also good for our communities, because families who own their homes are more involved in their communities and participate in local events.
The rewards of homeownership include:
- Personal satisfaction
- Sense of community
- Tax savings
- Stability for you and your family
- Investment in the future
Sellers...
Make the Most of that First Impression
A well-manicured lawn, neatly trimmed shrubs and a clutter-free porch welcome prospects. So does a freshly painted - or at least freshly scrubbed - front door. If it's autumn, rake the leaves. If it's winter, shovel the walkways. The fewer obstacles between prospects and the true appeal of your home, the better.
Invest a Few Hours for Future Dividends
Here's your chance to clean up in real estate. Clean up the living room, the bathroom, the kitchen. If your woodwork is scuffed or the paint is fading, consider some minor redecoration. Fresh wallpaper adds charm and value to your property. Prospects would rather see how great your home really looks than hear how great it COULD look, "with a little work."
Check Faucets and Bulbs
Dripping water rattles the nerves, discolors sinks and suggests faulty or worn-out plumbing. Burned out bulbs leave prospects in the dark. Don't let little problems detract from what's right with your home.
Don't Shut Out a Sale
If cabinets or closet doors stick in your home, you can be sure they will also stick in a prospect's mind. Don't try to explain away sticky situations when you can easily plane them away. A little effort on your part can smooth the way toward a closing.
Think Safety
Homeowners learn to live with all kinds of self-set booby traps: rollerskates on the stairs, festooned extension cords, slippery throw rugs and low hanging overhead lights. Make your residence as non-perilous as possible for uninitiated visitors.
Make Room for Space
Remember, potential buyers are looking for more than just comfortable living space. They're looking for storage space too. Make sure your attic and basement are clean and free of unnecessary items.
Fair Housing...
EQUAL HOUSING OPPORTUNITY
WHAT EVERYONE SHOULD KNOW
ABOUT EQUAL OPPORTUNITY IN HOUSING
The sale and purchase of a home is one of the most significant events that an individual will experience in their lifetime. It is more than the simple purchase of housing, for it directly impacts the hopes, dreams, aspirations and economic density of those involved. It is for this reason that the Fair Housing Act and other federal and state laws were enacted to guarantee a right to a national housing market free from discrimination based on race, color, religion, sex, handicap, familial status and national origin.
The Law
Civil Rights Act of 1866: The Civil Rights Act of 1866 prohibits all racial discrimination in the sale or rental of a property.
Fair Housing Act: The Fair Housing Act declares a national policy of fair housing throughout the United States. The law makes illegal any discrimination in the sale, lease or rental of housing or making housing otherwise unavailable, because of race, color, religion, sex, handicap, familial status or national origin.
Americans with Disabilities Act: Title III of the Americans with Disabilities Act prohibits discrimination against persons with disabilities in places of public accommodations and commercial facilities.
Equal Credit Opportunity Act: The Equal Credit Opportunity Act makes discrimination unlawful with respect to any aspect of a credit application on the basis of race, color, religion, national origin, sex, marital status, age or because all or part of the applicant's income derives from any public assistance program.
State and Local Laws: State and local laws often provide broader coverage and prohibit discrimination based on additional classes not covered by federal law.
The Responsibilities
The home seller, the home seeker, and the real estate professional all have rights and responsibilities under the law.
For the Home Seller: As a home seller or landlord you have a responsibility and a requirement under the law not to discriminate in the sale, rental and financing of property on the basis of race, color, religion, sex, handicap, familial status, or national origin. You cannot instruct the licensed broker or salesperson acting as your agent to convey for you any limitations in the sale or rental because the real estate professional is also bound by law not to discriminate. Under the law, a home seller or landlord cannot establish discriminatory terms or conditions in the purchase or rental; deny that housing is available, or advertise that the property is available only to persons of a certain race, color, religion, sex, handicap, familial status or national origin.
For the Home Seeker: You have the right to expect that housing will be available to you without discrimination or other limitations based on race, color, religion, sex, handicap, familial status or national origin.
This includes the right to expect:
-
Housing in your price range made available to you without discrimination;
-
Equal professional service;
-
The opportunity to consider a broad range of housing choices;
-
No discriminatory limitations on communities or locations of housing;
-
No discrimination in the financing, appraising, or insuring of housing;
-
Reasonable accommodations in rules, practices and procedures for persons with disabilities;
-
Non-discriminatory terms and conditions for the sale, rental, financing, or insuring of a dwelling; and
-
To be free from harassment or intimidation or exercising your fair housing rights.
For the real estate professional: Agents in a real estate transaction are prohibited by law from discriminating on the basis of race, color, religion, sex, handicap, familial status, or national origin. A request from the home seller or landlord to act in a discriminatory manner in the sale, lease or rental cannot legally be fulfilled by the real estate professional.
The REALTOR® Fair Housing Program
The NATIONAL ASSOCIATION OF REALTORS® has developed a Fair Housing Program to provide resources and guidance to REALTORS® in ensuring equal professional services for all people. The term REALTORS® identifies a licensed professional in real estate who is a member of the NATIONAL ASSOCIATION OF REALTORS®. Not all licensed real estate brokers and salespersons are members of the National Association, and only those who are may identify themselves as REALTORS®. They conduct their business and activities in accordance with a strict Code of Ethics.
-
The Code of Ethics: Article 10 of the NATIONAL ASSOCIATION OF REALTORS® Code of Ethics provides that "REALTORS® shall not deny equal professional services to any person for reasons of race, color, religion, sex, handicap, familial status or national origin. REALTORS® shall not be a party to any plan or agreement to discriminate against a person or persons on the basis of race, color, religion, sex, handicap, familial status or national origin." A REALTOR® pledge s to conduct business in keeping with the spirit and letter of the Code of Ethics. Article 10 imposes obligations upon REALTORS® and is also a firm statement of support for equal opportunity in housing.
If You Suspect Discrimination
Call the Local Board of REALTORS®: Local Boards of REALTORS® will accept complaints alleging violations of the Code of Ethics filed by a home seeker who alleges discriminatory treatment in the availability, purchase or rental of housing. Local Boards of REALTORS® have a responsibility to enforce the Code of Ethics through professional standards procedures and corrective action in cases where a violation of the Code of Ethics is proven to have occurred.
Call the U.S. Department of Housing and Urban Development: Complaints alleging discrimination in housing may be filed with the nearest office of the United States Department of Housing and Urban Development (HUD) or by calling HUD's toll free numbers, 1-800-699-9777 (voice) or 1-800-543-8294 (TDD) or on the internet at http://www.hud.gov/complaints/index.cfm.
.
