Jimmy Mulhern

We truly are blessed to live in the country we do - Thank you to all who devote your life to making this country what it is...I hope you were able to celebrate our nations bold anniversary of declaring independence with an enjoyable weekend!

Now that we are back to reality, I wanted to address the common misconception of who qualifies for a short sale. Many homeowners think that a short sale is about people going into foreclosure or buying homes that they could not handle - that is very far from the truth. In fact, most people in a short sale situation now are the ones who could handle the storm, but the individuals who defaulted dragged the values down so low that the rest of us are left to clean up the damage. A short sale is simply a sale in which the mortgage outstanding is higher than the sales price on the home. A successful short sale must include these three key ingredients:

1. Financial Hardship - This is very broad and can be the result of many things. Our website has a list of all the acceptable forms of hardship, but the most common are job loss/transfer, divorce, adjustable mortgage, loss in wages, or illness/death of a spouse. Simply unhappy about your homes value is not acceptable.

2. Monthly Shortage - A bank or investor will not be too quick to accept your request to have your debt forgiven if they see that you are still showing a positive monthly inflow. If you are asking for a short sale but pulling in $1,000 more each month than your expenses, then why would the bank accept your short sale. However, if you have been transferred and now you have to find housing in your new job location, then you do not have extra money and thus would qualify.

3. Insolvency - Simply put, are your assets greater than your liabilities. Now most people are worried about their retirement and 401k - in most cases these are not counted in a short sale since most bankruptcy laws protect them from creditors. But if you have a significant amount of money saved or invested...even as a "Rainy Day" fund...then this is something that the bank will attach their debts to. Think about it this way, if you have $100,000 in the bank but are asking the investor to forgive $75,000 you owe them, how likely do you think they would do that?

Qualifying is the first step. Getting your home sold and in the proper hands is another. Our team has now hired a law firm to represent all of our clients facing a short sale situation. Our profession is buying and selling property, not providing legal opinions. As a free service to our clients, our team of attorneys will sit down and provide a one on one counseling session to qualify your short sale and negotiate the terms of your short sale with the bank. What do you think has the better success rate...a short sale where the agent tries to wear all the hats at one time, or the Team that has qualified professionals handling both aspects of the transaction?

This service is free and part of our specialized resources to help all homeowners in trouble. There is a difference...don't waste your time hoping things get done. Put your best foot forward first and start living again.

Jimmy Mulhern

http://www.HowToAvoidForeclosureInVirginia.com

Any individual who practices real estate had to laugh when the FHA refinance program was announced. The Making Home Affordable program was inadequate when it was released - but yesterday they finally made an adjustment that is more in-line with what homeowners are really facing.

The previous plan to allow homeowners to refinance to a fixed loan if they owed less than 105% of the current market value was foolish and simply thrown out there to say "Hey look we are doing something". Since 2006, almost every market in the country has seen average declines of 18% in home values. So even the homeowner who had put 20% down was still going to to unable to refinance under this program...Now they have raised it to 125% - more in-line with where it should have started.

There is a reason why this program has only helped 4,000 of the over 7,000,000 homeowners who need the help. Maybe we should help the homeowners who buy the cars then the company's that make them - but that is an argument for another day.

If you are in a loan that has higher than a 6% interest rate - especially if you have a second - you need to find out more information about this program. If you have a first at 5%, and a second at 8%, you may be better off refinancing into one fixed loan.

Visit http://www.makinghomeaffordable.gov/ to see if you qualify for this program. If you are unaware of your homes value, fill out the form to the right for a complete market synopsis of what is happening in your neighborhood and areas around you.

Jimmy Mulhern

http://www.HomesInVirginia.net

Remember when it was raining almost every day for 3 weeks back in May? Where has all the rain gone? My $91 water bill wants to know when you will be back so I can stop watering my yard!

Just like the temperatures, the housing market in Fairfax, Loudoun, and Prince William County's is heating up. We are benefiting from limited supply and a huge increase in demand. This is a good thing - for sellers and a concern for buyers. Well a concern since it is tough to get a ratified contract, but good for a buyer since you know that people are at least out buying!

With the increase in traffic comes the question - what is my home worth? Well we want to introduce an innovative tool for you to track what is taking place in your neighborhood. To the right you will see a link to This Weeks Market Report - it is awesome! Take a look at the sample analysis to see what the report entails. This free tool will send you monthly reports on homes for sale, homes sold, and community reports for schools and demographics. It is a great way for a homeowner to track what is happening, and a great tool for a buyer to see what is going on in areas that interest them. IT IS FREE! You will receive a monthly email, and that is it, which is the report itself. It is better then Zillow because it is actual information from the MLS system...not a mis-computed algorithm that has more complaints than compliments.

It is an invaluable tool and a great source of information on your current and potential future home!

Take advantage of it now! Click on the link to the right or visit our homepage to sign up.

Jimmy Mulhern

Http://www.HomesInVirginia.net

When consulting a homeowner facing a short sale, the first question I am usually asked is "What will this do to my credit?" Now comes the generic answer...it depends! With the large amount of foreclosures and late notices, banks have had to take into consideration the overwhleming amount of delinquencies. This has caused them to take a less aggressive approach to how they handle consumers with poor credit. But again, each scenario is different.

If you stopped paying your mortgage, it does not matter what you do your credit will be impacted! A short sale will not save your credit from the 30-day late notice...but it is significantly better than what a foreclosure will do. Even in this scenario, a short sale can be reported that can eliminate the negative account which will help your overall score.

When you list your home as a short sale, it does not necessarily mean that you are facing a foreclosure. Plenty of people are being transferred out of the area for work that owe more on their home then what it is worth. These are employed individuals who can meet their monthly payment requirements, but just owe more on their house. This is where the "it depends" part comes in. When your short sale is accepted, the key ingredient to a "Success" is how you are able to negotiate the note. This means that when the bank accepts your payoff, they report to the credit bureau on the mortgages status. The best solution is a "Paid In Full" or "Paid As Agreed" status. This should have no impact on your credit score and is the ultimate goal. These are easier to get accepted when there is an agreement between the bank and the seller for a payment schedule on the amount owed. It is definitely a scenario that you must keep on the table to avoid the damage that a lowered credit score can have on you. Remember, this does not just impact future loans - it impacts rates you have on credit cards, insurance rates, and even some job opportunities.

If you are in a scenario where you are asking for the bank to forgive the debt you owe them, the first priority you have to get them to forfeit the rights to a deficiency judgment. Basically this is simply wording in the acceptance letter saying they will not seek a judgment against you. Now, if you are not able to negotiate out a "Paid In Full" status, you may have some credit implications. Do not let anyone tell you that you will never be able to get a home loan, or that you will have to wait "X" amount of years until you can get one. That is dictated by the loan you had, and the Fannie and Freddie programs usually will make you wait 2 years before you can get a home loan. However, there are too many banks out there that are all competing for business and one may give you a loan.

Most short sales have a minimal impact on your credit scores with a 100 point drop being an extreme case. The most important factor in what your credit will look like is whether or not you missed any payments. If not, then a successful short sale will allow you to continue on the road to financial freedom and ease the troubles of a home that is underwater.

Jimmy Mulhern

http://HowToAvoidForeclosureInVirginia.com

The clock is ticking - December is the deadline for your tax credit Mr. and Mrs. First Time Home Buyer!

But where are all the deals? Why can't I buy a home for pennies on the dollar anymore?

They are still there...they are just disguised! Last year, it was easy to go and buy a home. There was little competition, values had already taken a huge hit, and the property's were plentiful. Now there are less homes on the market, values did not drop that drastically from last year, and everyone is out buying. What gives?

Here is what you have to remember...it's a term called "Replacement Cost". Housing values tend to trend towards what it will cost to replace a home. In most metropolitan markets it stays around $124/sq. ft. without looking at land costs. Different areas have different values based on land costs, taxes, and overall economic health but the houses still tend to stay around that price point. The deals are there for the individual that factors this into their buying equation. Too many times people focus on the final price - certain dollar values are used as a focal point of whether a deal is good or not. "I won't pay more than $300,000."...does that sound like a good buying solution? We have budgets, don't get me wrong, and if you do not feel comfortable with a plus $300,000 mortgage payment then don't pay more than that. But why do buyers tend to think that a 1,800 sq. ft. home priced at $199,000 is a better deal than the 2,600 sq. ft. home priced at $250,000? Simply put, the more expensive home is cheaper on a per sq. ft. cost not factoring in a larger lot and any improvements that either one may or may not have.

Now if the $199,000 is the home that you can afford, then that is the one that you go after. But if I am about to invest in a home that I plan on living in for the next five years, why would I not buy the home that has been discounted the most? It will give me the best return in the future!

What is the point of all this - the deals are out there. Look past the sales price and focus on the true cost of a home. You may be surprised at what some of the houses out there are really being sold for. And besides, the smaller homes are costing you about $10 more per square foot!

Jimmy Mulhern

http://www.HomesInVirginia.net