Frank Godfrey - Realtor, e-PRO, ALC

Challenge Your Property Tax Assessment

If your property tax assessment is higher than it should be, there is something you can do about it. It might not be easy, however, as financially strapped local governments are in no hurry to reduce revenues.

The procedure will vary by jurisdiction and it is critical to understand the system. Below, I have listed the websites for Maryland, DC and Virginia (Arlington, Fairfax, and Alexandria) for detailed information on the process for challenging property tax assessments in that particular area.

You may want to seek the assistance of a tax professional, appraiser, attorney, or real estate agent to help you out.

DC: http://otr.cfo.dc.gov/otr/cwp/view,a,1330,q,594359.asp

MD: http://www.ptaab.state.md.us/faqs.htm

ARL, VA: http://www.arlingtonva.us/departments/RealEstate/RealEstateAssessmentsTaxYearInfo.aspx

FAIRFAX VA: http://www.fairfaxcounty.gov/dta/realestate_faq.htm#5

ALEX, VA: http://www3.alexandriava.gov/contactus/mailto.php?id=401

Maryland Foreclosure Laws

Maryland Foreclosure is both Judicial and Non-Judicial.

Maryland foreclosure law states that the person authorized to make a sale (trustee or sheriff) in an action to foreclose a mortgage or deed of trust shall give written notice of the action to the record owner of the property to be sold.

The written notice shall be sent no later than 2 days after the action to foreclose is docketed:

The notice shall state that an action to foreclose the mortgage or deed of trust may be or has been docketed and that a foreclosure sale of the property will be held.

30 days before the day on which a foreclosure sale of the property is actually held; and the date on which an action to foreclose the mortgage or deed of trust is filed.

In addition to any notice, the person authorized to make a sale in an action to foreclose a mortgage or deed of trust shall give written notice of the proposed sale to the record owner of the property to be sold.

The notice shall state the time, place, and terms of the sale and shall be sent not earlier than 30 days and not later than 10 days before the date of sale.

The person authorized to make a sale in an action to foreclose a mortgage or deed of trust shall give written notice of any proposed foreclosure sale to the holder of any subordinate mortgage, deed of trust, or other subordinate interest, including a judgment.

Each request for notice of sale shall:

Be recorded in a separate docket or book which shall be indexed under the name of the holder of the superior mortgage or deed of trust and under the book and page numbers where the superior mortgage or deed of trust is recorded; Identify the property in which the subordinate interest is held; State the name and address of the holder of the subordinate interest; and Identify the superior mortgage or deed of trust by stating:The names of the original parties to the superior mortgage or deed of trust; the date the superior mortgage or deed of trust was recorded; and the office, docket or book, and page where the superior mortgage or deed of trust is recorded.

Maryland Foreclosure Notice of Sale

Maryland foreclosure law states that a notice of sale must be published in a newspaper of general circulation in the county where the property resides at least once a week for three (3) successive weeks, with the first publication to be not less than fifteen (15) days prior to sale and the last publication to be not more than one week prior to sale. The trustee also sends a notice of the sale to the last known address of the mortgagor, and the owner of the title of the property. The notice of sale must be sent by certified and by registered mail, not more than thirty (30) days and not less than ten (10) days before the date of the sale.

The sale must be conducted by the person authorized to make the sale (trustee or sheriff) and may take place immediately outside the courthouse entrance, on the property itself or the location advertised in the notice of sale, if different. The terms of the sale vary by process.

After Maryland Foreclosure

Sale After the sale, the trustee sends a report to the court. Upon filing the report, it is published in the newspaper stating the foreclosure sale will be ratified 30 days from the date of notice.

Foreclosure University

I read this article in the Baltimore Sun this morning which they reported from the Chicago Tribune and thought it would be good to share with my neighborhood.

By Mary Ellen Podmolik Tribune reporter September 20, 2009 writes:

Housing: Short sales spread across real estate market, leaving frustration in their wake Offers may roll in, but banks often slow to respond, prompting buyers to walk away

A few years ago, few people in the housing market had ever heard of a short sale. Mention the term today and people, whether they are homeowners or real estate agents, just roll their eyes.

The practice, which involves selling a property for less than the amount owed on the mortgage, has grown in popularity as an exit strategy for financially strapped homeowners because it doesn't ding a credit report as deeply as a foreclosure. But because the transactions have to be approved by first and second lien holders, they are languishing. Some real estate agents try to steer clear of them entirely and even specify in their listings that a property is not a short sale.

The Obama administration is aware of the frustrations. In mid-May, Treasury Secretary Tim Geithner announced plans to streamline the process by offering financial incentives to mortgage servicers and investors that accept short sales, much in the same way that they are rewarded for refinancing or modifying troubled mortgages.

Four months later, homeowners, real estate agents and lenders are still waiting for specific details of how the plan would work. A Treasury Department spokeswoman said an update on the program is expected in a few weeks. Meanwhile, homeowners like Dallas O'Day are in limbo.

O'Day, a Chicago attorney, and his family relocated from California in June 2004 and bought a Mediterranean - style home in Chicago's Beverly neighborhood for $395,000. They rewired the house, stripped and refinished the wood floors and the woodwork and did other work to restore its charm.

Last year, personal circumstances prompted them to list the home for sale just as the housing industry's meltdown was picking up steam. With no takers and no longer even expecting to break even on his investment, O'Day relisted the 2,700-square-foot home in January as a short sale.

Four months and three price reductions brought the house down to $384,900, at which point a potential buyer made an offer in late May. O'Day accepted it and submitted the paperwork to the lenders holding first and second mortgages on the home.

He has yet to receive a response. Meanwhile, the family has moved into a North Side apartment, the refrigerator has broken in the home and there's evidence of mold in the basement.

"The only thing we keep hearing is they keep wanting current payroll stubs, bank statements and taxes," said O'Day's real estate agent, Pam Decker at Prudential Biros Real Estate in Evergreen Park.

"What has astonished me is that in the presence of one of the softest housing markets I can remember, we're hitting up on four months and they've just had a person assigned to look at it, that they would move at such a glacial pace," O'Day said. "My expectation is I'll be renting until whatever blemish is gone. I've just accepted the fact that at some point it'll be foreclosed upon because I just don't think the banks will pull it together. I feel like I've done everything I can do."

During the second quarter, 14 percent of all home sales were short sales and they were made primarily to first-time buyers who may have more flexibility to deal with the long wait times, according to a survey by Campbell Communications. The sales volume could be much greater. Two out of three short sales never close.

"In general, you have to have three offers for every completed short sale," said survey designer Thomas Popik. "The first offer, the buyer walks before they get a yes or no. On the second offer they walk a good part of the time. The third offer is the charm because it's been in process long enough at the lender that [the lender] knows they want to do this.

"Home buyers are now putting in half a dozen verbal offers, hoping that on one of them the lender will say yes. What this is doing is bogging down the approval [process] at the mortgage servicers. It's just gotten to the point that everyone has started engaging in unproductive behavior. It's a vicious cycle."

The process of getting a short sale approved involves a packet of documents that includes bank statements, tax returns, letters explaining any other sources of income and a hardship letter explaining why a short sale is being sought.

After the packet is submitted to a mortgage servicer, it has to be entered into the system, a person has to be assigned to it, and an appraisal has to be ordered for the property. On average, it took loan servicers 9 1/2 weeks to respond to a short sale offer, Campbell's survey found.

"You've got to stay on top of these banks," said James Orrico, a real estate agent at Professional Residential Brokerage LLC in Oak Brook. "I call on my files every day. If you don't stay on top of them, you'll lose it."

But not every real estate agent is willing to deal with the process. Online realty company Redfin doesn't show or write offers on short sale properties "because of the slim chance that you'll get the home," according to its Web site.

A number of factors are contributing to the delay. Lenders say their top priority is keeping people in their homes, and their own and the government's loan modification programs are taking the bulk of their resources.

"The modification [program] was just like an atom bomb that dropped on [servicers]," said Matt McCabe of National Short Sale Center, a company that acts as a negotiator between borrowers and mortgage lenders. "They had a really hard time reacting to that increased demand."

Wells Fargo Home Mortgage, which services more than 8 million mortgages, said it has cut the average 60-day response time on short sale offers to 30 to 45 days.

"We're not satisfied with that number," said Tamara Swain, senior vice president of real estate owned and short sales at the lender. "The current goal is 15 to 20 days. This has been a big learning process of a function that wasn't very prominent a couple years ago."

Also delaying the process is that if a home can't be saved, servicers are keen on trying to recover as much as possible for what could be multiple investors and that requires a fair amount of due diligence.

"The challenge is buyers always want to pay as little as possible and sellers want to receive as much as possible," said Tom Kelly, a spokesman for JPMorgan Chase, which services 10.3 million mortgages. "The bank is the server in the middle."

From a prospective buyer's standpoint, purchasing a short sale property can be preferable to a foreclosure because if the borrower stills owns the home, he or she is likely to take better care of it.

However, with so many distressed properties for sale, and other homes selling conventionally at drastically reduced prices, there's a wealth of inventory available allowing buyers to get a quick yea or nay to their offer. Some buyers make offers on multiple short sales or write the offers so they can walk away if a lender doesn't respond within a certain time frame.

Xia Zhao and her family thought they'd found their next home when they walked into a Jefferson Park townhouse that was listed as a short sale. It was large and near her son's school. However, they walked away from the offer after a month because they still hadn't received a response and were worried they wouldn't be moved in by the time school started.

Instead the family bought a new town home with a price that was cut by the developer in the city's Old Irving neighborhood.

"I guess we're not people with extreme patience," Zhao said. "What if you wait for a couple months and this goes away? You have to start all over again."

"Most people really aren't in a situation where they can deal with the uncertainty," said Zhao's real estate agent, Eric Rojas at Prudential Rubloff. "Even when you explain that it's not accepted until the bank accepts it and you build these safeguards into the contract, people are dropping out, left and right. These sales would get done, but people just can't wait."

Chicagoan Marie Cabrera, a real estate agent at Baird & Warner, is hoping she has found a purchaser with some patience.

After being unable to sell her own condo in the luxury Palmolive Building, Cabrera decided she didn't want to simply wait for her lender to foreclosure on it. Earlier this month she listed it as a short sale, priced at $1.15 million. Within a week, she had a cash offer of $1 million that she sent to her lender.

"I have no idea whether the bank will take it," Cabrera said. "I have an offer that's solid and they're willing to wait."

Frank G's Comments: I personally have closed successfully 90% of the short Sales I have taken and with the right team I will be on my way to closing my 10th short sale this year.

Your first step to succesful Short Sales is hiring a good attorney to handle most of the negotiations with the bank and make sure he is aware of the new laws in the state.

Your job as a Realtor is to find the Short sales and close them.

To learn if you are a good Short Sale candidate, contact my team today.

The only short sale The Godfrey Realty Group can not do is the one I am not working on.

Come One Come All - A Flea Market/Car Wash for a Cause in Upper Marlboro Prince George's County

It’s time to clean out your closets, clear out the garage, and find those long forgotten new or gently worn items stored in the basement. Businesses are also welcome to showcase your products and services. Bring it all to the Keller Williams Preferred Properties 1st Annual KW CARES & KWPP SHARES FLEA MARKET AND CAR WASH.

Public Vendor Tables are available for a $25.00 donation. Everyone welcome to participate.

Table donations will go to KW CARES, a tax exempt 501©(3)public charity created to support Keller Williams Realty associates and their families in times of extreme hardship as a result of a sudden emergency. Hardship is defined as a difficult circumstance that a person or family cannot handle without outside help. All other donations will go towards our KWPP SHARES to stay in our community to support KWPP Scholarships for Books & Dictionary Program. Dictionaries will be donated to the Prince George's County Public Schools Third Grade Classes. Additionally, funds will be used to support our KWPP family. Since these funds are not going to a 501©(3), the money collected for KWPP SHARES is currently not tax deductible.

KW CARES and KWPP SHARES is the heart of the Keller Williams Realty culture in action – finding and serving the higher purpose of business through charitable giving in the communities where our agents live and work.

Date: Saturday, September 26, 2009

Where: Keller Williams Preferred Properties(Parking Lot)

9701 Apollo Drive, Suite 102 Upper Marlboro, Maryland 20774

Time: 9:00am - 3:00pm

Those Who Have Chosen to Walk Away from Home Mortgages

A new study looks are those who have chosen to walk away from home mortgages, and it has a few surprises. For example: Who is more likely to walk away from a house and a mortgage -- a person with super-prime credit scores or someone with lower scores? Research reported in the LA Times, drawn from 24 million individual credit files, has found that homeowners with high scores when they apply for a loan are 50% more likely to "strategically default" -- abruptly and intentionally pull the plug and abandon the mortgage -- compared with lower-scoring borrowers.

National credit bureau Experian teamed with consulting company Oliver Wyman to identify the characteristics and debt management behavior of the growing numbers of homeowners who bail out of their mortgages with none of the expected warning signs, such as nonpayments on other debts. With foreclosures, delinquencies and loan losses at record levels, strategic defaults and walkaways are among the hottest subjects in residential real estate finance.Unlike in earlier academic studies, Experian and Wyman could tap into credit files over extended periods to identify patterns associated with strategic defaults.

Among researchers' findings are these eye-openers:

* The number of strategic defaults is far beyond most industry estimates -- 588,000 nationwide during 2008, more than double the total in 2007. They represented 18% of all serious delinquencies that extended for more than 60 days in last year's fourth quarter.

* Strategic defaulters often go straight from perfect payment histories to no mortgage payments at all. This is in stark contrast with most financially distressed borrowers, who try to keep paying on their mortgage even after they've fallen behind on other accounts.

* Strategic defaults are heavily concentrated in negative-equity markets where home values zoomed during the boom and have cratered since 2006. In California last year, the number of strategic defaults was 68 times higher than it was in 2005. In Florida it was 46 times higher. In most other parts of the country, defaults were about nine times higher in 2008 than in 2005.

* Two-thirds of strategic defaulters have only one mortgage -- the one they're walking away from on their primary homes. Individuals who have mortgages on multiple houses also have a higher likelihood of strategic default, but researchers believe that many of these walkaways are from investment properties or second homes.

* People who default strategically and lose their houses appear to understand the consequences of what they're doing. Piyush Tantia, an Oliver Wyman partner and a principal researcher on the study, said strategic defaulters "are clearly sophisticated," based on the patterns of selective payments observable in their credit files. For example, they tend not to default on home equity lines of credit until after they bail out on their main mortgages, sometimes to draw down more cash on the equity line. Strategic defaulters may know that their credit scores will be severely depressed by their mortgage abandonment, Tantia said, but they appear to look at it as a business decision: "Well, I'm $200,000 in the hole on my house, and yes, I'll damage my credit," he said of defaulters. But they see it as the most practical solution under the circumstances.

The Experian-Wyman study does not try to explore the ethical or legal aspects of mortgage walkaways. But it does suggest that lenders and loan servicers take steps to screen and identify strategic defaulters in advance and possibly avoid offering them loan modifications, since they'll probably just re-default on them anyway.