Jeffrey Reyes

Wouldn’t it be nice to finally be done with all of these foreclosures? The national headlines have reported this week that foreclosures have dropped 4.4% in October. That’s great news, right? We should all be jumping for joy that finally we are headed out of our housing crisis headed to higher ground.

When you look at our local numbers of foreclosures in the same time period, they look even better! In San Joaquin County we dropped from 615 foreclosures in September to 459 in October, that’s a decline of 25 percent! Stanislaus County won the foreclosure decrease of the month award with 525 in September dropping to 314 in October, that’s a whopping decline in foreclosures of 40 percent! Manteca saw a drop in the same periods of 42 percent!

So how come we are not all filling the streets with jubilation? Are we all just pessimists? Unfortunately it’s because we are all realists. Although it would be great if the drops in foreclosures were a permanent decline and sign of the future, the reality is it is a false drop.

When the robo signing controversy raised its head, many major banks had put a short moratorium on foreclosures while they investigated their foreclosure processes. Some of the banks that had the moratoriums in place, have now lifted them after stating that their foreclosure process is just fine or they have made the proper adjustments.

So what does this mean? Unfortunately it means that we are still in a housing crisis. How do I know that for sure? Manteca has 668 homes with a Notice of Default (NOD) reported with the county. A NOD is the beginning steps of the foreclosure process. Three months after a lender places a NOD on your property, they can legally place a Notice of Trustee (NOT) sale on the property. 319 of the 668 homes that have a Notice of Default in Manteca also have a Notice of Trustee Sale reported with the county! That is a large amount of homes that can hit our market at any time.

319 homes may or may not seem like a large number, if you add that inventory onto the 283 homes currently available in Manteca, it would take over six months to sell it all at our current average pace of 94 homes sold a month. That is all of course with out adding any other inventory in that time period.

Something else to consider is that even with 668 homes in Manteca in some stage of foreclosure, those number do not include everyone that is under three months behind on their mortgage, getting ready to miss payments, or who are heading in that direction. Make no mistake we are in some tough times.

Even with this news, there is still help. Where many homeowners are making a big mistake is seeking help way too late. Lots of homeowners are surprised when I tell them that there are lots of programs that they could qualify to help them stay in their homes without missing a mortgage payment. There is even help for those behind, and if your situation makes it difficult to hold onto your home, there are programs that can give you up to $3000 dollars in relocation funds to help you transition after a successful short sale.

Our housing crisis is not going to go away anytime soon, but the good news is that there is help out there. You are not alone. There are people who can help. For FREE no obligation information about a loan modification, short sale or other options available to you, please call me and my team at 209-627-0791 or go to our website http://alternative2foreclosure.com

Growing up in our valley, I loved fog! Because fog for us represents the changing of a season. It meant “red cups” are coming back to Starbucks, turkey will become a meal staple for a week and Christmas is around the corner. But a “foggy” or “gray” understanding of our real estate market can make for a great deal of anxiety.

In our information age, there is definitely an abundance of information about our distressed markets and mortgages. The big problem is deciphering through all the “fog” and noise to make an educated clear decision about your situation. Today I wanted to share some common questions I’ve encountered working with our fellow neighbors this last week.

Q. Should we stop making payments on our house?

A. We do not advise in that matter. Consult with a CPA. We have successfully helped many people who stayed current on their payments all the way through the process. There are also programs to assist people in a refinance or other solutions that are only for people who are current on their mortgages.

Q. How will a short sale affect my taxes and credit? Are there legal ramifications of a short sale?

A. The decision to sell your home as a “Short Sale” is only one of a number of choices you might have to address your needs. To determine the right path it is really important for you to consult with legal & tax advisors prior to signing the listing agreement. You should seek answers to your questions from licensed professionals before entering into an agreement with a buyer to purchase your home. Also know that if you feel like a short sale is not right for you, you can cancel the deal even at the escrow signing table, but there will be consequences such as a foreclosure.

Q. Can’t you as a Realtor/licensed agent consult me on tax, credit and legal matters?

A. No, it is beyond the scope of our duties to offer such consultation. We are not licensed in those areas.

Q. What are your duties, as my agent, in the short sale process.

A. We market your house for sale, negotiate on your behalf with the buyer and buyer’s agent, work with the lien holder(s) to process the short sale and manage the escrow process.
Q. How long can we continue to live in the house?

A. The house is still yours until the close of escrow or until it is sold in a Trustee Sale. During a short sale you can live in the house until the close of escrow or such time that you agree to vacate it based on the purchase agreement with the buyer. If the lien holder does not grant a short sale and chooses to foreclose (Trustee Sale) you will have to make arrangements with the lien holder for vacating the property. If you are the owner occupier of the home, there are government programs if you qualify, that will pay you $3000 for moving expenses.

Q. How will I know when I need to get ready to move?

A. If the short sale is approved you will receive a written “term sheet” from the lien holders(s) indicating approval. Escrow typically begins the day after the term sheet is delivered to the buyer’s agent. Most escrows are 30-45 days. So you will have 30-45 days, depending on the agreement you made with the buyer, for escrow to close. You must be moved out before escrow closes.

Q. There is a Notice of Default on my property. Is it too late to do a short sale?

A. No, in most in cases there still is time to complete a short sale after a home owner has received a Notice of Default. Please note that when you have received a Notice of Default time is of the essence and the short sale process must be started as soon as possible.

Q. There is a Notice of Trustee Sale on the Property is it too late to do a Short Sale?

A. We have successfully completed short sales after a Notice of Trustee Sale has been recorded. Depending on bank procedures and timing it may still be possible. Our team can make an assessment.

Q. I live in a Home Owners Association (HOA). How does this affect a short sale?

A. If you are current on your obligations to the HOA there should be no problem. We work to negotiate a short sale with your mortgage lien holder(s). It can be difficult to complete a short sale if you are behind on your HOA dues. Many HOAs will not participate in a short sale as they are cash strapped due to foreclosures and defaults within the HOA. It is possible to work out a short sale when you are in an HOA but it will require involvement on your part. You will be responsible to convey current HOA documents to the buyer of your home.

Hopefully these answers help to clear the “fog” and answer some of your questions. For more information on a short sale or a free loan modification please call 209-627-0791 or visit alternative2foreclosure.com

With all the news about interest rates and mansions selling for the price of shacks, many people are asking themselves, “Is now the time to sell our home?” The answer to that question depends heavily on your situation.

If you are a distressed home owner who may at some point in the future or currently is facing foreclosure, then the sooner you can get your home on the market, the sooner you can move on from your situation.

But if you didn’t take part in the real estate fiasco of the last five years, then now may be the best time for you to consider getting the home of your dreams at discount club store prices! There are many other reasons that you should consider selling your home and today’s market including:

Our market has increased in value:

Yes that is true! Our market here in the Manteca, Lathrop, Ripon, Tracy, Mountain House area has seen an increase in prices. “How can that be? I just saw on the cable news channel that we may double dip!” While national and world news gives us great information on a national and global level, they know nothing about our local area.

According to Zillow.com a national real estate information provider, the national median home value declined from $188,000 in July of 2009 to $182,000 in July of 2010. That’s a drop in value of almost 4 percent.

Contrast that with our local San Joaquin County market with a median home value at the end of 2009 of $168,000 increasing to $177,000 year to date! That’s an increase in OUR market of over 5 percent! So even though it is great to have a national and global perspective, you also need to know what is happening in your own back yard, and the grass is green.

Larger move-up homes are cheaper than ever:

If you have ever considered getting a bigger home, now is the best time to make the move. Thanks to the downturn in housing, you can purchase a home in the desirable Villa Ticino area of Manteca with 5 bedrooms, 4 bathrooms, over 3000 square feet, in ground pool and much more all for only $345,000 as of today. Compare that to a few years ago when it would have sold for over $500,000 maybe even touching the $600,000 range! Deals abound in the move up market and now is the time to take advantage of the prices.

Interest rates are incredibly low:

Interest rates as we all now are below 5 percent currently for owner occupied mortgages! That means if your current 1500 square foot home you purchased in 2000 for $150,000 with a 30 year fixed mortgage with an interest rate of 7 percent your total payment may be around $1,200 a month. But if you sold that house today and moved up to the previously mentioned home your payment would be just $2,200 a month. That’s only $1,000 a month more for DOUBLE the house!

And downsizing your home can yield you great value as well. Even the lateral movers are seeing great deals not just on the interest rates of their mortgages, but they can now afford to live in the neighborhoods they always wanted to before.

Have you considered renting your current home?

Many move up buyers are kicking their financial portfolios up a notch by turning their primary residence into a cash flow machine thanks to today’s low interest rates and relatively high rents. An older 4 bedroom 2 bath house in Manteca is currently selling for $129,900 and a similar home around the corner is renting for $1350 a month.

That means with a 30-year conventional loan the mortgage is only $760 and the possible rental income is $1350, making for a cash flow of $590 a month! Money may not grow on trees, but it seams to be growing in Manteca!

With a positive cash flow from their rentals, homeowners can move up and enjoy a bigger and better home they have desired for a long time.

So weather you are looking to move up, are in a distressed financial situation and facing foreclosure or are just thinking about taking advantage of our rental market to finance your dream home, now is by far the best time to sell and make the move.

Many people are now wondering if it is the right time to invest in our community. With very low property values, historically low interest rates and the volatility of the stock market, many savvy investors are starting to look in their own backyards for investments. But is investing in Manteca, Lathrop, Ripon or any community in our valley worth it?

Abraham Lincoln once said, "Property is the fruit of labor...property is desirable...is a positive good in the world. That some should be rich shows that others may become rich, and hence is just encouragement to industry and enterprise. Let not him who is houseless pull down the house of another; but let him labor diligently and build one for himself, thus by example assuring that his own shall be safe from violence when built."

Lincoln’s wise words not only help build individual wealth, but also improve the overall economy around you. If you have more income, odds are you will go to Bass Pro and buy more lures or take the family out for a nice Italian dinner at De Vega Brothers. You can be an economic stimulus to a community that desperately needs it. So why should you invest in our community?

Here are 4 reasons why I believe investing here is worth your while:

The price of housing is at relative all time lows.

As we all know, our housing market has taken a huge hit over the past few years. But what some are hanging their heads about and screaming doom and gloom, others are seeing as the deal of the century! For the first time in a very long time our housing market has dropped below the price of construction. There are plenty of houses for sale in our area below even 80 dollars per square foot. The cost to construct those same homes can cost any where from 90 to 110 dollars per square foot, depending on finishes and such. The deals are even better in the high end housing market where you can see a house in Ripon that sold in 2007 for $800,000 now available for $400,000.

We have also seen stabilization in our housing prices and even price gains. San Joaquin County in 2009 saw a median sale price of $168,000, and 2010 YTD we have seen our median sale price rise to $178,000, that’s almost a 6 percent gain in just six months. All of these are great signs of improvement in our housing market.

Interest Rates are below 5 percent.

That statement should stand out and grab you! Interest rates have dropped over 2 percent in the last 3 years and almost 4 percent in the last 10 years. Jim Camara with Scenic Oak Funding said, “Mortgage rates are at a 30 year low with the 30 year fixed rate loan for owner occupied properties around 4.500% and investment properties are around 4.990%. Loan products are available for first time homebuyers, move up buyers and real estate investors.”

Strong rental market

The demand for properties to rent is high, thanks in part to the slumping housing market. Many distressed homeowners who have had to short sale, foreclose or lose their homes to bankruptcy are pouring into our market looking for housing. In my opinion, they are some of the best tenants to have. Most people who have ever owned a home have a great sense of the “pride of ownership”. They understand what it means to turn a house into a home and care for a property. They also are stuck in the rental market for at least three years after a short sale and up to 5-7 years or more for a foreclosure or bankruptcy with a house involved.

The rental market is currently proving larger yields than the stock market.

Everyone who has stocks or a 401k knows what I am talking about. We all see our quarterly reports, shake our heads and read the rest of the mail. The Dow Jones Industrial Average has seen a decline from January 11, 2010 to July 8, 2010 of 542.92 points or 5.11 percent. So if you would have invested $200,000 in the index six months ago, you would have seen a loss of over $10,000!

Now take that $200,000 and invest it into our local housing market and with our low interest rates and cheap housing, coupled with relatively high rents, you could have purchased three homes providing you positive cash flow of $1,500 a month after paying the mortgages and property taxes. Now that’s a good reason to invest in Manteca and not just Wall Street!

What does it take to get started investing in our community?

Like any investment it takes money to make money. But if you have 20-25 percent down, at least 6 months worth of rent in reserves and a credit score of 720 or more you might qualify today. Or you could always purchase with cash and have all the rental income be positive.

It also takes a great Realtor who understands the community, housing market and your needs and desires to help you accomplish your goals. I would also recommend consulting a CPA and having a good real estate attorney.

And as Donald Trump said, “Well, real estate is always good, as far as I'm concerned.”

For more information on real estate and investing in our community please visit my site http://centralvalleyrealestatesearch.com