Troy Jowers, New Orleans Realtor

Scott Rhinehart, Realtor in Mission Viejo, CA and his sister are helping a Sargeant Commander in Iraq that she knows to throw a Luau for his troops in Spetember. Scott's blog on this can be found here. If you're in the metro New Orleans area, please donate any unwanted large and x-large hawaiian-style shirts to the casue.

I'm spearheading the effort to collect them in our area. So please contact me for more info or to arrange a pickup of your shirt. Of course if you're in the area, you can also deliver them to me at my RE/MAX office, 4141 Veterans Blvd in Metairie.

Thanks, ya'll!

An Internet based company that sells its services to help Realtors and lenders in various capacities has launched a petition campaign asking for a reversal of the Home Valuation Code of Conduct (HVCC). Though Representatives Childers (D-MS) and Miller (R-CA) have introduced a bill that will place an 18 month moratorium on HVCC, this petition seeks to end the mess altogether.

If you're not familiar with that the HVCC is, Google it and find out. It will affect us all. The idea is nice, but as with most rushed things, it's having unintended consequences in practice. The Web Site for the company is thinkbigworksmall.com and the link to the petition page is on the right column of the home page.

In my experience and training with short sales, the lenders ALWAYS ask for a reduction in commission, but if the numbers on the contract are right, just tell them no. Don't be intimidated. They want the deal to happen, too.

It all depends on just how "short" the short sale is. Every bank has a very set bottom line that they can accept in a short sale. If it is crossed, the property than becomes a financially viable contender for repossession and resale. Remember, their purpose in accepting a short sale is to recover more money than they otherwise would if they had to foreclose. If the deal crosses that line, then cuts start coming to make the bank's "walk away" figure go above that line. And also remember, the bottom line can vary both by foreclosing bank and by type of loan (VA, FHA, etc.). For example if the bank can only accept a deal for 80% of what is owed on the loan, then you must back out closing costs, commissions, etc. from your contract price, and make sure it doesn't cross that magic line. If you stay on the good side of that figure, then of course you'll still be asked to cut your commission, but just say no. It's never failed as long as the commission is not over 6%.

As a listing agent for short sale properties, you should get to know your seller's particular bank's rules on short sales. These numbers will telll you if you have a short sale offer that the bank can even entertain. It is not a random decision, but rather a calculated one. Additionally, they all have a certain collection of paperwork (referred to as a short sale package) that should all be turned in together, not piecemeal...unless you want the response to take 4 months, and then have that response be: "the package is not complete, we can't make a decision."

Whether representing buyer or seller, I suggest learning the ropes of short sales with that particular bank. It will save you so much time, effort, and ill will with aggravated clients and colleagues.

The Finance Authority of New Orleans (FANO) still has tons of money to give to first time home buyers to help them get into the New Orleans real estate market and out of the high-priced rental market. There are so many incentives for the program in addition to the federal housing tax credit.

However, as I have begun working deals with the FANO program (and watching some of them fall apart), I am realizing that the program's restrictions make it a tough road for the Realtor and lender who deal with it. Here's a few of the challenges that, if you can get through them, will lead your qualifying clients to a dream come true.

1. The income qualification are quite low, though they have been raised recently. When a client does qualify using those numbers, then that extrapolates into a very inexpensive house for the New Orleans market. Often, those homes get snapped up since we are not experiencing quite the down turn here as so many other markets are.

2. The time to close one of these deals can be 8 weeks and that by itself often makes an offer less attractive. The positive side to relate to sellers is that to qualify for the program, the buyer has to be pretty solid on their first mortgage application.

3. Preference is given to buying a home in "opportunity zones". These zones are often areas that clients do not want to live in, or where this is widespread blight (and some of the blight pre-dates Katrina). There is a silver lining in that there is a smaller pool of money available for homes outside the zones that can prove a requires minimum in Katrina damage.

4. The documentation required is staggering. While we all know that the whole "no-doc" thing was a serious mistake, but this program is a step toward the other extreme.

5. There are a limited number of lenders who are approved to apply on behalf of the client for the program. Be kind to those lenders, remembering that it is an even worse experience for them than it is for the Realtors or even the clients. The lenders make their money on the FIRST mortgage, which can be $65k plus down payment less than than the asking price used to calculate commission for the Realtors, and the price of these houses are pretty low to start. Understandably, some of my preferred referrals in the lending world will not touch these.

Prepare your buyers beforehand. Prepare the seller and listing agent beforehand. As long as the program is not a surprise to anyone involved in the deal, there's not been a problem negotiating acceptance of these offers. The key is to educate yourself, then educate the other players and keep the lines of communication open.

More information on the program is available at www.financeauthority.org.

After 25 years under its current name and countless brandy milk punches, Petunia's Restaurant in the French Quarter is closing its doors after today. Not only have I been there countless times for their amazing blend of "Creole Cuisine and Cajun Cooking," but it was always a place I recommended for my out of town clients and friends. It was always worth the tight squeeze and long wait to brunch in this truly historic landmark. I was lucky enough to eat there one last time this morning. So long, friend!

PETUNIA'S RESTAURANT
St. Louis St., New Orleans, LA