Rachael Hite-Twigg

Is your Short Sale going well?

How do you know if your Short Sale is going well? This is a hard question. Especially since the process can be long, repetitive and frustrating even when it is going smoothly! Here are a few tips of what I have found to be the "norm" in the process.

1.) Pricing the home the 30 day price: Each mortgage company has a different attitude towards the price that the home should be listed for. Some have the attitude that the home needs to be listed for what is owed for a specific time period (30-90 days) before the price is lowered. I have found that marketing the home at a realistic discounted priced based on local REO sales has been my best bet. If your REALTOR does not know what a BPO is, you seriously need to question their ability to price your home well.

2.) The contract: Your short sale cannot begin until a contract for purchase is on the table. In short if you do not have a deal, you cannot short sale. A contract needs to be obtained ASAP to start the process. Some lenders will begin the paperwork without a contract, but most will not take the offer seriously until a buyer is ready to move on the property.

3.) The waiting game: Short Sales can take several months. Usually you will not have news for weeks at at time. Your REALTOR needs to call and monitor the transaction closely. If they are waiting for the mortgage company to call them with updates, your file may not be getting the attention it deserves.

4.) Foreclosure Notices: Most Short Sales can delay foreclosures. Have your REALTOR call the mortgage company and the attorney to request a delay in foreclosure to allow for more time for the contract to be worked out.

5.) Have a plan B: You are Short Selling your home. You should be looking for a rental or other living arrangements. Make sure you are ready to move so that you are not caught off guard when the transaction is ready to settle.

6.) What's your Record? Always ask how many Short Sales they have completed and what is their success rate. If they don't have a good answer or they tell you its hit or miss, Call another REALTOR.

7.) Don't wait until its too late!!! If you have a foreclosure date set or have not made a payment in 3-4 months you are at risk and even a great REALTOR may not have enough time to save your home.

For more information visit www.equitynegotiations.com, we specialized in Short Sales and are ready to help you sell your home!!!

At the End of the Day . .

One of the most commonly used phrases in our office is "At the End of the Day . . ." which is usually used to summarize a reality check for the issue at hand. Almost every person I know is pinching pennies to get by. Whether it is the average family cutting back on their annual summer vacation, or the single person who is seeking out cheap entertainment with friends, we all are not living the lifestyle we were living a few years ago.
Working in real estate I have seen the ugly side of this recession: divorce, foreclosures, bankruptcies, abandoned pets, molded homes. Dealing with the realities of what is going on can easily make a person question how everything came unhinged so quickly. There is a positive side to this recession too: Home values are down to where families can actually afford to purchase a nice home at a reasonable price, and the credit crunch is teaching us all how to live financially responsibly ( whether we want to or not).

Here is my top 8 "At the End of the Day . ." tips for homeowners and REALTORS

1.) KNOW what you want: Take the time and effort to figure out what you want out of your home purchasing and selling experience. Make a list of your goals, a loose time line and interview agents until you find one that "clicks" with your vision.

2.) BE REALISTIC: All the upgrades in the world do not matter right now! The bottom line is price. Your home must be priced well to sell!

3.) STOP watching HG TV! ( Just Kidding) You can watch, but again make sure that your expectations are realistic. The majority of their programs are filmed in CA, or suburbs of large cities. Be familiar with your market, and which homes are selling.

4.) BEWARE of Open Houses: The time and energy you spend baking cookies, and the cash you dump into a newspaper ad, may be better spent on effective Internet marketing OR cleaning stained carpets ( painting a neutral color) . If your home is not a showcase, and it is not priced aggressively, you will be disappointed with the results of an open house.

5.)SHOP your Mortgage!: I do not care if your loan officer is your Grandmother! Make sure that you are not being charged an arm and a leg in closing fees. Always ask for a Good Faith, and Always get a second opinion.

6.) HOME INSPECTION: A good home inspection can make or break a deal. Vacant properties can have underlying issues. Encourage an inspection for informational purposes and find an inspector you trust.

7.) BE a Conductor: A good REALTOR needs to stay on top of the entire transaction, and encourage good communication with their clients. This is hard on both parties, but the effort must be there, so make yourself available but also remember to set some boundaries.

8.) DON'T BE the Problem: If you have a buyer that wants to buy and a seller that wants to sell, make sure that you are not getting in the way of making that happen. Sometimes, lending, pricing, and commissions will need to make a deal happen. Be flexible and ready to think outside of the box.

We have more ways than ever to get a real estate transaction completed. For more tips and options visit my site www.equitynegotiations.com, to search for homes, get information and even find out how much your neighbor's house SOLD for!!

Common Short Sale Myths!

One of the most difficult conversations I have with potential clients is where I discuss what the current market value is of their homes. Most homeowners have attached feelings of pride and sentiment into their homes, especially if they had worked hard to maintain and improve the property.

In our area( Northern Virginia) property values have dropped around 35% since 2005 and we have not hit the bottom yet. I know many other local markets are very similar, and other REALTORS have been saddled with the responsibility of helping many homeowners have a harsh reality check. The equity that homeowners were counting on to shore up their financial future has evaporated. Will it return? Yes, with time I think that things will even out, but for homeowners that are now $70,000.00+ upside down on their homes, the recovery may not happen before they need to move.

Many homeowners are unaware that they can sell and avoid foreclosure through a Short Sale. A Short Sale works similarly to a regular real estate transaction, but the realtor negotiates their commission and the sales price with the lender that holds the homeowners mortgage. Often short sales will take several months to complete, but the outcome can save all involved parties a great deal of stress and money.

Myth #1: A Short Sale will have the same affect on my credit as a foreclosure SO why should I bother? First a Short Sale will always look better to future creditors because it shows your willingness to cooperate and that you just did not abandon the property. Different mortgage companies are reporting short sales differently on credit reports, points may drop anywhere from 0-200, it may look like a credit charge off, and short sales typically only stay on a credit report 4-6 years as opposed to the 7-10 a foreclosure remains on your credit.

Myth#2: I need to hire an attorney to perform a short sale and I cannot afford it! Not necessarily! An experienced REALTOR who is familiar with negotiating short sales will be able to complete the task AND negotiate their commission. Of course REALTORS always recommend legal and tax advisers, but you should not have to pay anyone for a Short Sale.

Myth#3: My home needs to many repairs I cannot sell it now! Your home can be marketed to be "SOLD AS IS" meaning you disclose that the home will not have any repairs made and the sales price should reflect that. The only thing that you may still have to pay for on your home is utilities to make sure that no further damage happens to the home while it is vacant. This too can sometimes be helped if the home is secured properly by a professional and utilities can be turned off to save money.

Myth # 4: I have a foreclosure date scheduled its way to too late to try and save my home from foreclosure! Once a date is set the chances of pulling it off the court house steps are less than 5%, but recently we have had success with certain mortgage companies in delaying foreclosures to market homes for sale. An experienced REALTOR will be able to help evaluate your situation and help determine if foreclosure prevention is a possibility.


Sometimes it just does not make good financial sense to modify your loan to keep your home. If you have had a permanent change in income, your home needs numerous repairs, and if you are $70,000.00+ upside down on your mortgage, even a modified mortgage may not help you turn around your finances for the good. If you have to put more money in to an investment, that is already worth less than what you owe on it, you may just be flushing your dollars down the drain. Our economy and our real estate markets have created many financial pitfalls for current homeowners, but you do have options outside of traditional real estate practices. Please visit my website www.equitynegotiations.com for more information on short sales and the options that are available to homeowners who are experiencing financial difficulties.

May 29th U.S Housing and Urban Development Secretary (HUD) Shaun Donovan announced that the $8,000 tax credit offered through the American Recovery and Reinvestment Act of 2009 can now be used towards the 3.5% down payment OR closing costs for FHA loans! The tax credit currently only could be accessed after the purchase of the home, but this new revision will allow first time home buyers to immediately put their credit to work towards the purchase of the home. This new found flexibility will open up doors for even more first time home buyers who were struggling to save the initial 3.5% down payment and additional closing costs.

Currently the FHA allows parents, employers and other government entities to contribute towards the down payment, but now with the tax credit potential home buyers will have yet another source to help bridge the initial expenses to purchase a home. I know I'm not the first, but the more REALTORS that write about it, the further this great new will travel. Please visit www.hud.gov/news/release for more information. Sing it from the roof tops! We can make this market great with good deals and better mortgage products!

Many clients that I have worked with of late, want to keep their homes. A loan modification is something that may be an option to them and a way to prevent foreclosure. I always try to make sure that they know all of their options including short sales and loan modifications. Here are a few tips that I have discovered about loan modifications, from working with my sister company Equity Negotiations.

Is this best for my situation?

1.) To qualify for a loan modification you will need to show a hardship in your income. Hardships include: Job loss, wage/ hour reductions, extensive medical bills, divorce, and death.

2.) The income that you do have will need to be able to sustain a modified payment. Lets face it, the banks are willing to work with you BUT they are not going to let you live in your home for free.

3.) Modifications are wide spread, most are customized for the individual and their situation. If your income change is temporary, your lender may offer you a repayment program. Interest rates, principle reductions, special arms, are all possibilities that lenders are exploring . The modifications can be as short as a few months or as long as several years.

4.) You can negotiate this yourself: Most lenders have their contact information online, or available to you by a mailing packet you can request. Most of our clients come to us because they have difficulty reaching their lender, collecting the necessary paperwork, or are unsure of how the process works and would like assistance with the entire process from start to finish. Often our staff can easily have 10+ hours of phone hold time just trying to get the correct information to the lenders to start the process!!

5.) If you have had a permanent change in your income, and cannot support a reasonable mortgage payment, you may need to look at Short Selling your home. This option is better than foreclosure because it offers a faster opportunity to correct the damage to your credit and allow you to show your willingness to cooperate with lending institutions in the future.

6.) I'm still not sure: If you have questions about loan modifications, please feel free to call our help line at 540-450-8705 to speak with our staff. Or send us an email: info@equitynegotiations.com