John Newman

More disturbing news was released today on Marylands Foreclosure Crisis. In the third quarter of 2009 13.9% of homeowners in Maryland were seriously delinquent or in some stage of foreclosure. This is up from 7% the same time last year, according to the Mortgage Bankers Association. Many do not believe that the number of foreclosures will peak till late 2010. I would anticipate that the number of short sales in Maryland grows exponentially, as a short sale is fast becoming one of the most popular options for both homeowners and lenders.

Unfortunately, many homeowners are not aware of their options, even though they have many available to them. If you are delinquent on your mortgage DO NOT wait to ask for help, contact your lender immediately! If you proactively seek help, you will be surprised by the options available.

Upside down in your mortgage, behind on payments contact us today for a free short sale evaluation.

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I get this question all of the time and unfortunately the answer is YES. However, how much will depend on several factors. How many months late are you currently? Was your credit OK, prior to a short sale? (meaning was this a temporary setback), How long of a credit history do you have? These are only a few criteria the credit reporting agencies will use to assess your credit worthiness.

Unfortunately, many homeowners are asking the WRONG QUESTION. The question should be WILL MY FINANCIAL SITUATION IMPROVE WITH A SHORT SALE?

See many of us are trained that our credit is critically important to our financial stability, this is far from the truth. I know many people with pristine credit on the verge of bankruptcy and I know many with horrible credit that are financially stable. Now I am not advocating using credit irresponsibly, but I belive that financial stability should come before your credit. In other words, FORGET ABOUT YOUR CREDIT, and start thinking about FINANCIAL STABILITY.

An 800 credit score with $0 in the bank and $0 net worth is worthless.

Upside down in your mortgage, behind on payments contact us today for a free short sale evaluation. You can also find us on Facebook

Homeowners if you are facing foreclosure, DO NOT just walk away consider a SHORT SALE. Wachovia bank is quietly offering homeowners a cash incentive to pusue a short sale instead of foreclosure. This is being done without much fanfare and without much press. Currently Wachovia is the ONLY bank I am aware of that is considering this option and as far as I can tell is only being done is California. However, I would expect multiple lenders to follow and this to be available for Maryland Short Sales soon. As I wrote previously, the Treasure Dept. is finalizing a plan that will provide the same type of compensation. View the entire article on Wachovias' short sale plan .

Upside down in your mortgage, behind on payments contact us today for a free short sale evaluation. You can also find us on Facebook.

Let me first state that neither I nor Keller Williams Realty are advising homeowners to default on thier mortgage and homeowners should consider the legal, tax and financial consequences of doing so.

In a research paper written by Brent White, Associate Professor of Law, University of Arizona, Mr. White makes an argument as to why it makes sense to walk away from your mortgage. Mr. White makes some interesting points:

• Homeowners do not walk away due to shame and guilt associated with foreclosure and perceived fear of the consequences of foreclosure, even when those consequences are in actuality much less severe than most homeowners have been lead to believe.
• As of June 2009, more than 32% of all mortgaged properties in the U.S. were "underwater", meaning that the homeowner owed more on their mortgage than their home was worth.
• Mr. White, makes the argument that "Millions of U.S. homeowners could save hundreds of thousands of dollars by strategically defaulting on their mortgage." "Homeowners should be walking away in droves. But they aren't"

Wow, this is a gutsy article you can view the abbreviated version at http://blogs.wsj.com/developments/2009/10/30/its-ok-to-walk-away-a-law-professor-argues/

View my Short Sale Blog!

I just read an interesting article inthe Baltimore Sun about the magnitude of foreclosures in MD. Here are a couple of quick facts:

• 163,479 Foreclosures Projected 2009-2012
• Foreclosure starts up 470% from 2006
• Lost Home Equity Wealth $1.9 Trillion
• 134,923 Families behind on Mortgage as of the end of June

These estimates come from the Center for Responsible Lending in a September 2009 report. Now also think about this, these numbers do not take into consideration an increase in Unemployment or the number of Strategic Defaults that are becoming more common.

As taxpayers it is our duty to do what we can to stop these foreclosures, at the end of the day, WE WILL BE THE ONES PAYING FOR IT! If you know someone who may be at the end of their rope, through them a lifeline and have them contact me, a Short Sale may be an option.