West Orange, NJ

This morning Barbara Corcoran was interviewed on the Today Show about how many homeowners are walking away from their mortgage. Here’s what they reported: 1 in 4 homeowners in this country today is under water on their mortgage, they owe more to the bank then their home is actually worth. A million people last year simply got up and walked away from their mortgages. They left their home behind to take the pressure off their shoulders. What does this mean, the moral dilemma not the legal implications to the bank, goes to what the homeowner values.

Yes, big corporations and banks do this every day on paper, but do you stick to your commitment and pay your mortgage until you can get a workout with the bank to keep the home or to do a short sale or do you just walk away and ruin your credit and help to ruin your neighborhood by helping bank-owned foreclosure properties increase, which decreases value on the block? It’s a hard question for many to answer. What would you do?

As you think about this, read this overview provided by the National Association of Realtors (NAR) that gives some useful tips. If a short sale becomes an option contact us, Bev and Bob Meaux. We have earned the nationally recognized Short Sales and Foreclosure Resource (SFR) certification, which simply means we are not afraid of short sales and have taken steps to understand the process for you and are here ready, willing and able to help you through the short sale process. The National Association of REALTORS® offers the SFR certification to REALTORS® who want to help both buyers and sellers navigate these complicated transactions, as demand for professional expertise with distressed sales grows. We have also teamed up with a local certified public accountant and attorneys that have short sale experience to provide free consultations to our clients.

According to a recent NAR survey, nearly one-third of all existing homes sold recently were either short sales or foreclosures. For many real estate professionals, short sales and foreclosures are the new “traditional” transaction. New Jersey REALTORS® who have earned the SFR certification know how to help sellers maneuver the complexities of short sales as well as help buyers pursue short sale and foreclosure opportunities.

“As leading advocates for homeownership, REALTORS® believe that any family that loses its home to foreclosure is one family too many, but unfortunately, there are situations in which people just cannot afford to keep their homes, and a foreclosure or a short sale results,” said 2009 NAR President Charles McMillan, from Dallas-Fort Worth area. “Foreclosures and short sales can offer opportunities for home buyers and benefit the larger community, as well, but it’s extremely important to have the help of a real estate professional like a REALTOR® who has earned the SFR certification for these kinds of purchases.”

The certification program includes training on how to qualify sellers for short sales, negotiate with lenders, protect buyers, and limit risk, and provides resources to help REALTORS® stay current on national and state-specific information as the market for these distressed properties evolves. We took one course and three webinars in order to become certified and constantly stay abreast of what’s happening to be a resource through the short sale process for our homeowners.

There's always something artsy and fun happening in West Orange, New Jersey. From creating new ways to have fun to celebrating the old feelings of days gone by. Take a self-guided tour of the recently opened Thomas Edison Laboratory Complex, the place where Edison invented the motion picture camera in 1892. Drift over to the prestigious Llewellyn Park -- the first planned community in America -- and visit Glenmont, the grand estate Thomas and Mina Edison called home.

Experience more history through the West Orange Film Society as it launches its fifth annual West Orange Classic Film Festival on January 31 with A Hard Days Night playing at 2pm at the AMC Theater, Essex Green Shopping Center, West Orange. They promote this as a film directed by Richard Lester about a typical day in the life of the Beatles. There will be a post film chat led by Star Ledger film critic Stephen Whitty. Tickets are $7 per person, $6 for West Orange Arts Council members. Stay on top of what the West Orange Film Society is planning for the Film Festival by joining their Facebook page.

The Society has already announced future events to be held at the AMC Theater at 2pm on Sundays:

• February 7 - Black Maria Film Festival
• February 14 - Rebel Without a Cause
• February 21 - The Burmese Harp
• February 28 - The Red Shoes
• March 7 - Mr. Smith Goes to Washington
• March 14 - The 400 Blows
• March 21 - The Man Who Shot Liberty Valance

After all of this, go back to the future and stay abreast of the new development happening at the South Mountain Codey Arena area. There's already ice skating, the Turtle Back Zoo and the new large merry-go-round. Now the county is planning even more fun in this area adding a mini-golf course and restaurant with trolley service.

There are so many ways to easily find an opportunity to have fun in West Orange, New Jersey.

There were 399* residential homes sold in West Orange, New Jersey last year, down by just 60 compared to what was sold via the Garden State Multiple Listing Service (GSMLS) in 2008. To show stabilization West Orange needs to creep back up pass the 400 mark in residential home sales via GSMLS.

I must note, my reports always includes information gathered from GSMLS so if there's a private seller, new construction or new development that is not selling via the GSMLS it won't be tracked here. For example, I've seen newspaper ads that have said the new development Vizcaya has sold quite a few units but only one shows up on GSMLS. Vizcaya sales, however, will be similar to Llewellyn Park meaning a million dollar sale in either of these two develoopments in town does not directly correlate to increased value to the rest of the town's housing stock.

View the full list of all the West Orange residential homes that sold in 2009. This list will show the address, list price, sales price, how many days the house was on the market, and how close the owners got to their asking price, (SP/LP%). You will also see that 51 out of the 399 residential homes sold for over $600,000. Of those, 25 were townhomes, 7 were in Llewellyn Park and only 9 were homes built more than 15 years ago (and only one of those made it pass the $660,000 mark). If you've been following our town analysis through our quarterly Beacon report none of this will be too much of a surprise for you. For the town, the average days on market before a house went under contract was 89, just shy of 3 months. By the way, Maplewood 2009 sales show 3 1/2 months as its average days on market.

Breakdown by School Section

Overall $383,521 $403,357 95%

By Section Avg Sales Price Avg List Price SP/LP%

Gregory $341,445 $358,232 95%

Hazel $304,163 $323,705 93%

Mt. Pleasant $476,807 $501,987 95%

Pleasantdale $320,698 $338,068 94%

Redwood $427,061 $448,280 95%

St. Cloud $357,711 $376,225 95%

Washington $230,292 $241,062 95%

Be careful when you look at the average prices in Mt. Pleasant and Redwood. Basically all of the new construction sits in Mt. Pleasant. Redwood has Llewellyn Park.

Contact us, Bev and Bob Meaux to learn more about the real estate market in West Orange and surrounding towns. For example, which section had the most homes sold, but which one had the least? What are buyers looking for in West Orange houses priced over $425,000? What two things can you do as a seller to get your West Orange home attention in this market?

Partner with us because we are here to make sure you win the best way you can in real estate today.

An educated consumer is our best client and partner.

*The list of properties was pulled from the Garden State Multiple Listing Service. This will not include all the For Sale By Owners from private sellers or new construction or developments not listed through a real estate agent. All information deemed reliable, but not guaranteed.

More than ever in today's market when you're looking to purchase it's important to know a little about the seller's situation before you proceed with making an offer. This doesn't mean to beg your agent to find out mortgage details and personal information on a homeowner who's selling his/her home in a regular arms-length transaction sale. But it does mean that your real estate agent should make sure it's indeed a normal sale or whether it's in jeapordy of being a short sale or is a short sale and, if so, where things are in the short sales process.

Today buyers in Bloomfield, Maplewood, Montclair, South Orange and West Orange, New Jersey will see more short sales this year so it will be hard to avoid them. Work with Bev and Bob to understand what you're getting into and how to best navigate through a short sale or any type of residential purchase.

3 PURCHASE OPTIONS

1. Regular Arms-Length Transaction: This is what is considered a normal sale by a homeowner and what buyers are use to;
2. Foreclosure: A bank-owned property where the homeowner you are dealing with is the bank, which makes this a very un-emotional transaction. The bank has had a BPO (Broker Price Opinion) completed -- a market analysis of the home -- and has determined the price of the property based on the BPO and other factors they deem important. Most foreclosure properties are sold "as is", which means what you see is what you get. It's important for you to get a home inspection to determine if you still want to go forward with the purchase or not. Banks love dealing with cash offers whenever possible;
3. Short Sales: This is when a house is being sold for below what the homeowner owes and the homeowner does not have any other funds to make up the difference at closing.
   

For more details about Short Sales and whether you're a good candidate to purchase one, read this informative overview produced by the National Association of Realtors®.

THINKING OF MAKING AN OFFER ON A SHORT SALE? WHAT YOU NEED TO KNOW

If a home is being sold for below what the current seller owes on the property—and the seller does not have other funds to make up the difference at closing—the sale is considered a short sale. Many more home owners are finding themselves in this situation due to a number of factors, including job losses, aggressive borrowing against their home in the days of easy credit, and declining home values in a slower real estate market.

A short sale is different from a foreclosure, which is when the seller's lender has taken title of the home and is selling it directly. Homeowners often try to accomplish a short sale in order to avoid foreclosure. But a short sale holds many potential pitfalls for buyers. Know the risks before you pursue a short-sale purchase.

YOU'RE A GOOD CANDIDATE FOR A SHORT-SALE PURCHASE IF:

• You're very patient. Even after you come to agreement with the seller to buy a short-sale property, the seller’s lender (or lenders, if there is more than one mortgage) has to approve the sale before you can close. When there is only one mortgage, short-sale experts say lender approval typically takes about two months. If there is more than one mortgage with different lenders, it can take four months or longer for the lenders to approve the sale.

• Your financing is in order. Lenders like cash offers. But even if you can’t pay all cash for a short-sale property, it’s important to show you are well qualified and your financing is set. If you're preapproved, have a large down payment, and can close at any time, your offer will be viewed more favorably than that of a buyer whose financing is less secure.

• You don’t have any contingencies. If you have a home to sell before you can close on the purchase of the short-sale property—or you need to be in your new home by a certain time—a short sale may not be for you. Lenders like no-contingency offers and flexible closing terms.

If you are serious about purchasing a short-sale property, it's important for you to have expert assistance.

HERE ARE SOME PEOPLE YOU WANT TO WORK WITH:

• Experienced real estate attorney. Only about two out of five short sales are approved by lenders. But a good real estate attorney who's knowledgeable about the short-sale process will increase your chances getting an approved contract. Also, if you want any provisions or very specialized language written into the purchase contract, a real estate attorney is essential throughout the negotiation.

• A qualified real estate professional.* You may have a close friend or relative in real estate, but if that person doesn’t know anything about short sales, working with him or her may hurt your chances of a successful closing. A qualified real estate professional will be able to show you short-sale homes, help negotiate the purchase when you find the property you want to buy, and smooth communications with the lender.

• Title officer. It’s a good idea to have a title officer do an initial title search on a short-sale property to see all the liens attached to the property. If there are multiple lien holders (e.g., second or third mortgage or lines of credit, real estate tax lien, mechanic’s lien, homeowners association lien, etc.), it's much tougher to get that short sale contract to the closing table. Any of the lien holders could put a kink in the process even after you’ve waited for months for lender approval. Your real estate attorney can recommend a title company or process this for you.

SOME OF THE OTHER RISKS FACED BY BUYERS OF SHORT-SALE PROPERTIES INCLUDE:

• Potential for rejection. Lenders want to minimize their losses as much as possible. If you make an offer tremendously lower than the fair market value of the home, chances are that your offer will be rejected and you’ll have wasted months. Or the lender could make a counteroffer, which will lengthen the process.

• Bad terms. Even when a lender approves a short sale, it could require that the sellers sign a promissory note to repay the deficient amount of the loan, which may not be acceptable to some financially desperate sellers. In that case, the sellers may refuse to go through with the short sale. Lenders also can change any of the terms of the contract that you’ve already negotiated, which may not be agreeable to you

• No repairs or repair credits. You will most likely be asked to take the property “as is.” Lenders are already taking a loss on the property and may not agree to requests for repair credits.

The risks of a short sale are considerable. But if you have the time, patience, and iron will to see it through, a short sale can be a win-win for you and the sellers.

* Not all real estate practitioners are REALTORS®. A REALTOR® is a member of the NATIONAL ASSOCIATION OF REALTORS® (NAR) and is bound by NAR’s strict code of ethics.

Note: This article provides general information only. Information is not provided as advice for a specific matter. Laws vary from state to state. For advice on a specific matter, consult your attorney or CPA.