Jason Trotman

I have many clients who ask me what are my thoughts about short-sales. My answer is SIMPLE…”STAY AWAY FROM SHORT-SALES!” The experience of a short-sale can be a sobering and depressing one, especially for a first-time homebuyer.

In my attempt to explain to homebuyers why a short-sale is not the best choice for your first homebuying experience, I have created a list of reasons as follows:

1. Time-consuming: The short-sale process has not been streamlined so there is not set procedure for the whole process. Each bank has their own rules and timeframe for dealing with short-sales. A short-sale can take anywhere from 3 to 8 months for approval and actually getting keys at settlement.

2. No Guaranteed Outcome: The main problem with the short sale process is simply lack of COMMUNICATION. In most banks, there are two departments: 1)short-sale dept. 2)foreclosure dept. Neither of these offices communicate to each other regarding a particular property. Even though a property is approved for a short-sale, the foreclosure department is still proceeding with the foreclosure. There are many instances after 2-3 months into a short-sale, the seller and buyer will be surprised to find out the property has gone into foreclosure and will be sold on the court house steps.

3. Waste of Money: Most buyers thinking about purchasing short sale are looking to save money on a “GREAT DEAL.” However when factoring in the opportunity cost of your time being spent on a short-sale at best you breakeven. I have many clients invest in appraisals and home inspections just to find out the bank has decided not to approve the short-sale.

4. Cost you more money: A short-sale is not always a great deal because the bank will not always guarantee to pay the fees associated with the transaction. For example, if you are in a transaction and the bank decides not the pay the agent commission or attorney fees, then the seller and/or buyer would be responsible.

If anything good came out of this housing bust, it is that housing is more affordable. Many couples and single people are now able to go house hunting. Due to the large amounts of foreclosures around the country, people are able to afford their first homes now instead of waiting for an extended period of time.

Since buying a home is one of the most significant purchases you will make in your life, it is understandable that you want to be cautious. Being a first-time homebuyer can be extremely overwhelming. You’re bombarded with information and struggling to find balance between your wants, needs, and of course, sales price. Media reports constantly publicize the availability of “cheaper” homes, giving the illusion that first-time homebuyers can get everything their hearts desire for next to nothing. While there are great real estate deals available, more than likely you will have to make concessions. You may even have to put in some sweat equity. No matter which property you choose, you will still need to transform the space to reflect your personal sense of style. If you’ve never been a do-it-yourself kind of guy or girl, trust me, owning a home will definitely change that.

Many first-time homebuyers make the mistake of holding out until they get everything on their “list of wants” and end of losing a great property. Just like you have an idea about what encompasses your dream vacation or dream wedding, I’m sure that you have envisioned the type of property that you would call home. But sometimes things don’t go so smoothly. The airline may reroute your luggage, cancel your flight, or the venue may not be able to accommodate your needs the way you hoped. Either way, you have to make adjustments. The home buying process is the same way. If the property is located in your desired area and the price is right, the color of the walls or cabinets shouldn’t be a deal breaker. You are the most important accessory to a property because you make it a home.

More often than not, your first home will not be your dream home, but rather a starting point until you can afford that dream home in that perfect location. That’s not to say that your first home can’t come close to your dream. The main thing to remember is that if you find fault with every property that you view, the likelihood that you will find a great property will definitely be reduced exponentially. As a DC Realtor®, I can assure you that owning a home is still a great investment in the DC area.

When you begin looking for your new home, remember to be open-minded. The family that lived in the property before you, made it their own and purchasing it will give you the same opportunity. Buying a home opens endless possibilities for style and creativity.

Hopefully you found this post useful! If you need help finding or selling your Washington DC home, please contact Jason Trotman at 301-452-4767. If you’re new to DC, I’d especially like to extend a warm welcome. I value the opportunity to help my clients find the home that meets their needs and provide them with professional, reliable service.

Thinking about purchasing a home...Don't be NERVOUS! If you have been watching the news or reading newspapers, you are constantly bombarded by a variety of perspectives on the status of the Washington DC real estate market. Keep in mind, that the real estate market fluctuates on a monthly basis depending on many variables such as interest rates, loan applications, foreclosures, short sales, etc. Just like Politics...ALL REAL ESTATE IS LOCAL!



What should a homebuyer expect in this market? High down payment requirements, stringent credit score, and financial qualification requirements are the biggest woes for homebuyers in today's real estate market. Along with the usual stories about the obstacles of finding the "Perfect" home, purchasers must be informed about aware of their loan options and how it affects both their short-term and long-term goals.



First-time homebuyers must be familiar with the two most common types of available loans: 1) FHA and 2) Conventional.



What is an FHA loan? A FHA loan is a government-backed loan consisting of mortgage insurance which provides homebuyers with the ability to purchase a home with a low downpayment (ie. currently 3.5% of the salesprice).



What is a Conventional loan? A conventional loan is not guaranteed or insured by the federal government which does not require mortgage insurance but has a higher downpayment of 20% of the salesprice.



What are the most recent mortgage requirements? These guidelines are constantly changing on a monthly basis, so it is important to be informed about your qualification needs.

The majority of banks are requiring a credit score of 640 for approval of FHA and Conventional loans.

Debt-to-income ratio must be within 45% for FHA. This is based on your Gross Income.

Condo Delinquency Ratio under 15% for FHA & Conventional for building approval.

Investor Ratio is under 50% for FHA for building approval.

Investor Ratio is under 30% for Conventional for building approval.

What does a homebuyer need for a preapproval? Many people will go to their local banks and ask to get preapproved and of course, your bank will ONLY run your credit score and you an arbitrary amount. The best response from loan officers after giving you a preapproval is "Come back to me when you find a home and I will give you a monthly payment!"



I hope I'm not the only one who thinks that is ABSURD, especially after the economic troubles from the mortgage markets and lack of disclosures to homebuyers.



I encourage all potential homebuyers to add the following items on a checklist to give to their lender to determine an accurate estimate of their homebuying potential at the outset.



1. 2 most recent W-2s

2. 2 most recent monthly statements

3. 2 most recent paystubs

4. Additional information about investment accounts









Hopefully you found this post useful! If you need help finding or selling your Washington DC home, please contact Jason Trotman at 301-452-4767. If you’re new to DC, I’d especially like to extend a warm welcome. I value the opportunity to help my clients find the home that meets their needs and provide them with professional, reliable service.

This is my first YouTube video and I've decided to start with a tour of my Logan Circle neighborhood. This is the debut of my directorial career...James Cameron here I come!







Please join me and subscribe to my new YouTube channel: http://www.youtube.com/user/jtrotmangroup



Hopefully you found this post useful! If you need help finding or selling your Washington DC home, please contact Jason Trotman at 301-452-4767. If you’re new to DC, I’d especially like to extend a warm welcome. I value the opportunity to help my clients find the home that meets their needs and provide them with professional, reliable service.

It's graduation season across the country and undoubtedly you've racked up quite a sizable amount of debt. The premise behind amassing student debt is to improve your quality of life. As you're considering your options and prepare for the inevitability of moving to another city, you've probably wondered how this massive amount of student loan debt will effect your ability to purchase a home. Maybe homeownership is not on your to-do list just yet but it will be.

And now is as good of a time as any to consider its impact on your credit and ability to purchase big ticket items. As you know, a good credit score is the key to being able to qualify for any loan. The higher the credit score, the likelihood that you will be approved. Be aware that defaulting on your student loans can have grave consequences. Your lender can assign your loan to a collection agency who will hound you to the ends of the Earth, garnish your wages, or take possession of your federal and state income tax refunds. This can all be avoided by knowing the options available to you. Taking care of your personal finances is the key to achieving your long-term goals.

So, how does student loan debt fit into your credit worthiness?
As a new grad, you have the ability to defer the loans at least for a time while you look for employment. Take advantage of this because the job market is very tenuous in some places.

• Make a plan. Before you have to begin making your monthly payments, research your options. This will likely mean that you have to put off a new car for a while and continue living with your parents. Either way, you want to make sure that you utilize every available avenue so that you don't default on your loans
• Consider consolidating your loans (undergraduate and graduate). Not all lenders offer student loan consolidation programs.
• As you relocate, ensure that you update your contact information for your lender. If you miss any payments, they will contact you but you will also be notified about important changes and promotions that can affect your monthly payments.
• Look for student loan forgiveness programs. These professions may not have high starting salaries but it is an opportunity to have a significant amount of debt eliminated.
• Find out if you qualify for any special programs and a fixed interest rate. This can ensure that your monthly payments are stable at least for a time.
• Don't neglect your savings. While it may seem an impossible feat to manage paying your student loans every month coupled with other living expenses, it is still possible to start saving for the future.

Neglecting your student loans is a NEVER a good idea. Aside from being reported to the credit bureaus, sent to collections, and lower credit scores, you will rack up thousands of dollars in late fees and other charges. Eventually, the amount of money to have to repay will be a sum much larger than if you paid your monthly bill or negotiated another payment arrangement with your lender. You can recover from defaulting on your student loans and begin improving your credit worthiness. There are federal programs that have been developed to help students through financial hardships without adversely impacting your credit rating. Credit matters and the more knowledgeable you are about your options, the greater chance you have to achieving your personal and career goals.