They have since been resistant and perhaps even defiant in wanting to proceed with foreclosures.  That is the concern.  Will the banks allow these additional requirements to impede their ability to get homes to market?  While they may not be pleased with the process and it will cost them more time and money, I think they will get their procedures in order and eventually we will see the market stay on its course.

That means that while we are in the holiday season and approaching a new year, the number of foreclosures will remain low, but they will pick up in the first or second quarter of next year and the inventory will continue to remain at the levels we have seen in the last 30 months.

The impact on homeowners desiring desire to short sale their homes is still unclear, but the banks have all concluded that short sales are far more favorable than Foreclosure and this legislation will certainly not change that opinion.

Following these simple guidelines can help your loan process go smoothly. 
 ·         Do not make any deposits into your bank account that are not directly from your compensation.  New guidelines require underwriters to source every deposit on your bank statements to ensure that the money is yours.  You do not want to make cash deposits of any kind while in the loan process.  Cash deposits are hard to source and create delays in the processing of your loan.  
 ·         Don’t move assets from one bank account to another.  These transfers show up as deposits and complicate the loan process.  
 ·         Don’t buy or lease an automobile or extend any new credit on your credit cards for large purchases.   The underwriter looks carefully at your debt to income ratio.  Any increase in payments will affect your ratios and may in turn affect your loan approval.
 ·         Don’t change or quit your job.  Losing a job with no employment will result in your loan being declined.  Even if you find a new job, two paystubs from that job will need to be provided prior to funding.
 ·         Don’t attempt to consolidate or pay off bills before speaking with your lender.  Your loan officer will advise you if this needs to be done.
 ·         Don’t pack or ship information needed for the loan application.  Important paperwork such as W-2 forms, divorce decrees and tax returns should not be packed and shipped to your move with your household goods

Please contact Kari with any questions about the lending process or to obtain your loan pre-approval. Her contact information is:

Kari Phillips, MBA | Senior Loan Officer
Southern Fidelity Mortgage

6585 High St. | Las Vegas, NV 89113
Office (702) 228-2889 x1813 |  Fax (702) 951-5051  |  Cell (702) 375-3401
MLS# 25126  NMLS#309701
Kari.Phillips@GoSouthernFidelity.com  |  www.GoSouthernFidelity.com/KariPhillips

Now that banks control a large portion of our market, the agents have educated the buyers to know that it may be weeks for a reply or you may never hear at all!  (The listing status may just be changed to “no longer available” in the computer).  Why are we dealing with short sales in the same manner which is disrespectful to other agents and their clients?????

In a short sale, the seller of the property (NOT the bank with the mortgage!) signs the offer.  Have we not prepared our sellers to be available to accept an offer??  The seller should be encouraged to sign an offer with a buyer that has these important qualifications:

1.  Time to wait for the short sale to be approved.

2.  Education that some of the costs they ask for may be turned down by the bank approving the short sale.

3.  An “at list” offer- not a crazy bidding war offer.  The bank with the short sale may ask for more so the buyer’s agent needs to prepare the buyers that they may have to increase their offer. 

4.  A professional agent that addresses the above items in the letter accompanying the offer.

5.  An investor’s offer may not be the best offer because generally, they are making more than one offer.

6.  Finally, EARNEST money with the offer and a willingness to place it in escrow!

Let’s answer (in a timely manner), the buyers that are willing to give us an offer that comes closest to meeting the criteria above!  Let’s see some professionalism in real estate in cases where we have some control.

 The homeowner purchased her home at the height of the Las Vegas boom.  She scraped together her down payment and stretched her budget to the max.  Times were good and it seemed like the right way to go before the prices got higher and homes were out of her reach.  She was able to afford a $250,000 home.  Her mortgage was adjustable and the payment barely affordable, but with both her and her husband’s salaries, they could make it.  Of course, her credit was spotless.  The American dream was realized.

 After they settled into their home, they worked hard on finishing it with backyard landscaping, a covered patio, and all the things they felt they needed to make it a home.  Things were going great.  Then, WHAM! Las Vegas was changing- times were tough, business was off, and consequently, her husband was laid off.  She was lucky – she had a great boss who cut everything else but kept her at her current salary.  In addition to her husband’s layoff, her loan rate adjusted and her payment went up.  Her neighbors also hit on hard times and abandoned their homes.  The average $250,000 price in her neighborhood dropped to $95,000.

 She was in a quandary.  Should she join the group of neighbors and go into foreclosure or try to do the “right thing”?  She had heard about this new thing called a “loan modification”.  She contacted The Big Bad Bank and the process began.  She filled out all the paperwork and had the right qualifications.  It looked like a sure thing.

After several months, lo and behold, her loan modification was approved!  Her payment was reduced $500!!  Now, remember her loan period was extended another ten years, but it still seemed like the right thing to do.  She began to pay the lower payment as they instructed.  Being a vigilant person with regard to her credit, she decided to check her credit report after three months.  The Big Bad Bank had reported her late to the credit bureau THREE TIMES!

When she called, she was told that her loan modification was a “trial” or “temporary” modification.  She said, “But I paid what you asked!”  The Big Bad Bank said, “But you paid less than your original agreement.  We accepted it but it was not what you agreed to when you bought the house.”  The homeowner is disputing the late payments with the credit bureau and is hoping for the best.

This homeowner was trying to do the right thing.  The moral of the fable “The Wolf and The Crane” is “In serving the wicked, expect no reward, and be thankful if you escape injury for your pains”.  The moral of my story is “When you try to do the right thing, the wolf still may eat you”.

By the way, This story is NOT fiction…