If you are in a bind, you need to sell your home BUT it is worth less than you? You call your lender, after numerous departments, you finally get through to the Short Sale department. This is what you find out:
1. You must qualify for the short sale.
2. You have to have no way to make up the difference for the deficiency.
3. You have to provide all kinds of personal documentation to prove you cannot: to keep the house, or pay for the deficiency.
4. The short sale department will not approve the short sale until you get a contract.
5. It takes 3-8 months for them to "approve" the short sale.
You put the house on the market, you find out that the buyers are slim to none because most buyers do not want to wait 3-8 months to find out whether they are going to get the house.
I closed on a short sale. It took 3 months to even find out if we had it. They back did their form of appraisal after the seller had agreed on a price, then just before closing renegotiated the price.
Short Sales are really FIP's (foreclosures in progress). Most buyers avoid them like the plaque, if you wait until they go into foreclosure they are easier to deal with.
At the end of the day, you credit is shot, you may find yourself unable to buy another house for 4 years or so, and the lender MAY be able to come after the deficiency at a later date.
It is very important to consult an attorney, bankruptcy or some other legal action may be to your advantage.
Even with the "market woes" there are many bargains to be had and cities that are thriving. Here are some cities, according to Forbes Magazine, to consider:
Daily Real Estate News | July 15, 2008
Top 10 Cities to Buy a Home
Financially, at least, the best places to buy houses are those where buying costs less than renting, tax incentives are attractive, and there's an opportunity to build equity.
Forbes magazine surveyed the 40 largest metropolitan area housing metrics looking for cities where home prices have appreciated over the last two years. It also measured vacancy rates. And it gave extra points to cities where rents are significantly higher than a buyer would pay for the same home.
Texas dominated the magazine's list because of its healthy job market and growing tax revenues.
Here are the 10 cities that topped Forbes' best-places-to-buy list:
- Houston
- Austin, Texas
- St. Louis
- Philadelphia
- San Antonio, Texas
- Dallas
- Charlotte, N.C.
- San Francisco
- Jacksonville, Fla.
- Atlanta
Source: Forbes, Maurna Desmond (07/14/08)
Many people across the nation are staying put. Timing is everything. It may be a good time to remodel or put on that much needed addition. But in so doing it is really important to weigh the cost of the project, the length of time you will be staying in the home, and the amount of "value" it will bring on resale.
Remember, what buyers are looking for are those things that will save them money. Most buyers either cannot afford major repairs or do not want to go to the expense. The market for that type of buyer is the investment market. The investment market is a highly discounted market. Investors want a steep discount in order to refurbish, have money left over to sell and of course a "return on dollars spent" or profit. It is most often much cheaper to get your home in shape, keep it in order, than to sell "as is" (that is aka for "steal me").
The most important issues, and those that come up on the home inspections over and over are:
1. Roof, age & condition. Most shingle roofs last approximately 15-20 years. When replacing you may want to consider an architectural shingle roof, they have a longer life expectancy.
2. Air conditioning and heating systems. Again about the same life span, so keep them serviced, and filters changed monthly. If you buy a home with an older unit, by all means get a warranty and keep it going till the unit dies. The new federal regulation requires that the entire unit, inside and out, be replaced with a minimum 13 seer unit for efficiency rating. This can cost upwards of $6-$8000.
3. Updates: Kitchen & baths. Be smart, replace the vanity, mirror, faucets & light fixtures yourself, this will be a big selling point. It is not difficult, I even did it myself :) The kitchen remodel is more expensive, but if you either refinish by using a good cleaner (some have color in them), or paint, put new hardware on, change out your faucets for updated faucets, paint, and put in newer appliances (often scratch & dents can make it very affordable), it will bring a quicker sale at a higher price.
4. Take down any wallpaper and paint. Paint should be fairy neutral, staying in the varying shades of beige, even a little darker for accents, or the very popular, lighter shades of sage green, etc.
5. Take down any heavy or dark window treatments, replace with inexpensive blinds and toppers (you can really save money here by buying some fabric and cheap rods at a discount retailer ie: Big Lots).
6. Less is more. You don't have to take down all the family pictures, but be sure the frames are of the same frame family, and there are not so many of them on the walls. Clean up everywhere, put things away or box them for the move. Rent a storage unit or if you cannot afford that, stack them high in the garage.
7. Biggie: Curb appeal. Get out there and put a deep, nice clean edge on the lawn with the edger, pull all the weeds, put fresh mulch, rock or other material to freshen the gardens, trim all the bushes, trees and mow the lawn. Be sure the fence is in good repair, and clean, same with any decks, sheds or patios. Set up the patio furniture to make it inviting. If you don't have any, use a few inexpensive lawn chairs and some potted plants, makes it pretty and your yard a place they can see their family. Remove any rusted items including children's play sets, and above ground pools that are not in the best of condition.
Here is a link for some additional information on home improvements that will help. Just remember, go for the most bang for the buck on the short run, go for the best you can afford for the long haul.
http://costvalue.remodelingmagazine.com/index.html
