Posts tagged as:

BPO

Fed Seeks to Lower Mortgage Rates Further

by Chris McLaughlin on March 19, 2009

 

Real Estate News & Commentary by Chris McLaughlin, March 19, 2009
http://www.shortsalesriches.com/welcome.html

——–

“2 Careers That Boom in a Recession!”
I’ll tell you about one of these for fr*ee
in my no-charge, no-cost, no-obligation
webinar right here live on Thursday night at
8:30 PM ET, 5:30 PM PST:

 

https://www2.gotomeeting.com/register/995947853

 

Why would I do that for no charge?  Because
I want a chance to tell you about the other
high-income opportunity, too.

 

And I can’t do it in an email.

 

But if you’re finally ready to blast out of
this economic mess, then get a move on… I’d
hate for you to miss out, because we always fill
up a day or so early.  See if there’re any spots
left:

https://www2.gotomeeting.com/register/995947853
———
Floods of money:  Recovery or inflation?

 

The Federal Reserve was widely expected to hold the short-term bank lending rate at between zero and 0.25 percent, so it came as no surprise when it did.  The decision to dump money into the economy to try to buy us out of the recession was only slightly more surprising, but the amount — $1.2 trillion — took everyone by surprise.  Hoping to lower mortgages rates and consumer debt, the Fed will spend up to $300 billion to buy long-term government bonds and an additional $750 billion in mortgage-backed securities guaranteed by Fannie Mae and Freddie Mac.

 

Market reaction

The immediate market reaction was good:  the Dow bounced 90 points, the S&P soared, and all market indicators were generally positive.  Government bond prices leaped too, since mortgage rates will be going down even further than before.  If, and it’s a great big if, this can help stabilize credit markets and get us all spending, the economy may start to climb out of recession this year.  But is there a catch?  You bet.

 

 Inflation

Some economists — the ones with more than 10 minutes training in economics 101 — say the $3.9 Trillion slated for the budget can’t help but create galloping inflation the minute the economy starts to recover.  In fact, inflation may not even wait for the recovery; the dollar took an immediate tumble against other major currencies with the Fed announcement.  The Wall Street Journal’s Judy Shelton doesn’t mince words:  “How can capitalism find its footing when the monetary foundation is shifting with each new government bailout — each new infusion of deficit-financed government expenditure?  American families deserve better than to be punished by wasteful public spending and ruinous inflation.”

 

More free eco-cash

So you didn’t qualify for freebies from the mortgage bailout?  Cheer up — Washington is on a spending spree, and you can get up to $19,000 in upgrades to your house.  Expanded tax incentives in 2009 and 2010 for energy-efficient and renewable-energy home improvements include $1,500 in tax credits for qualifying windows, doors, insulation, roofs, heating and cooling equipment, water heaters, and even wood and pellet stoves. You’ll get a tax credit of 30% with no upper limit through 2016 for installing qualifying solar technology, small wind-energy systems, or geothermal-well systems.

 

AIG again

The House will vote today on a bill to levy a 90 percent tax on bonuses paid to employees with family incomes above $250,000, who work at companies that have received at least $5 billion in government bailout money.  Edward Liddy, brought in last year by the government to run AIG, told a House subcommittee Wednesday that the company was contractually obligated to pay the bonuses but added that many of them had already returned part of all of the bonuses.  The saga continues.

 

Now on to our real estate investing education section …

 

Fast Facts About the Stimulus Bail-Out

 

Short sale investors are likely to encounter clients that want to hold out for a big fat government paycheck rather than walk away from a home. After all, the media is filled with reports about big checks, bail-outs and “free money.”   Of course, scams and other fraudulent schemes abound making it tough to educate consumers about the facts versus fiction of the stimulus plan. Here to help is a quick primer about the proposed bail-out:

 

Fact: In order to refinance homeowners must be up to date on their current mortgage yet still demonstrate that they are “at risk” of facing foreclosure. The government anticipates up to 4 million households will fall into this delicate balancing act in order to qualify for funds…and it’s not limited to just owner occupied homes.

 

Fact: Mortgage modification clauses are much more difficult to obtain. Homeowners will have to satisfy the following stipulations in order to qualify:

 

Second lien holders must agree to waive or write-off obligations.

 

The home must be worth 80 to 105 percent of the current mortgage.

 

The primary lien holder must agree to modify principle, extend the duration of the loan and/or reduce interest rates to as little as 2 percent…or a combination of all of the above.

 

The homeowner must agree to credit counseling if they have extensive household debt in addition to high mortgage obligations.

 

Homes must be the primary residence and currently occupied. Homes cannot be vacant, in need of extensive repairs or otherwise hindered.

 

Up to $1,000 annual incentive payments will be made for up to five years – but only if the homeowner isn’t late on payments.

 

A new inspection may be required as well as the following documents:

Recent tax return and 2 to 4 recent pay stubs. Self-employed borrowers will need copies of quarterly estimated tax returns and prior year return.

 

Copies of all bank statements.

 

Proof of income from Social Security, alimony, child support or other income that you intend to use for the purpose of qualifying.

 

Current mortgage and liens including second mortgages.

 

Completed copies of Form 4506-T…a Request for Transcript of a Tax Return.

 

Completed copies of Form 1126 – a Borrower Financial Information form.

 

Proof or documentation of hardship, job loss, or other factors that may have influenced your current financial situation.

 

See you at the top!

 

 

 

 

Chris McLaughlin

http://www.shortsalesriches.com/welcome.html  

 

P.S.

 

Don’t miss out webinar this coming Thursday night at 8:30 PM ET, 5:30 PM PST:

 

https://www2.gotomeeting.com/register/995947853

 

Copyright Loss Mitigation Institute 2009.
All Rights Reserved.

http://www.shortsalescoach.com
http://www.shortsalesriches.com
http://www.reomillionaireclub.com 
http://www.sixfigurebpo.com *************************************************
Finally, a blog for Real Estate professionals
that want up-to-the-minute news, & how it impacts
us and our market…

http://www.shortsalesriches.com/blog

*************************************************

About the author:

 

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

 

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month

   * Long-time authority on real estate investing
      and rapid flipping of distressed homes.  Owns
      portfolio of nearly 100 high-value, high-profit
     properties

    * Owner and Supervising Broker of one of Florida’s
     largest Real Estate firms, running 4 different
     offices, supporting nearly 450 agents, uniquely
     positioning him to help thousands of investors
     make money in the biggest market opportunity ever!

     * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
      in Real Estate Investing, Entrepreneurship, and
      Wealth Building

     * On twitter: http://twitter.com/mclaughlinchris
     * On facebook: http://www.facebook.com/addfriend.php?id=709199143

—

{ 0 comments }

Beating up a BPO!! (Finale)

by Nathan Jurewicz on August 20, 2008

One more word of advice…

You really don’t want to come in too pushy. The last thing you would want to do would be “I need this number to come in at this number”. You have to make them think that they are the expert and are the boss and use “jedi” mind tricks to make the bpo agent think that it was their idea to give you the number that you want.

A lot of these bpo agents are only doing bpo’s because the market crashed and they need their $65 bpo to put food on the table. They don’t like investors that are going to make a substantial amount of money on the deal. Sometimes it will be an REO agent that has an agreement with the bank that says that they have to do a certain number of bpo’s for free in exchange for getting reo listings handed to them on a silver platter. Sometimes they think that if they screw up your deal then when the house goes to auction they will get the listing so its important you tell them the hardship of the seller so that they have some sympathy for the situation.

{ 0 comments }

Beating Up a BPO!! (Part Four)

by Nathan Jurewicz on August 19, 2008

What to say when you meet the bpo agent or appaiser?

First off you have to determine who you are. If you’re an investor you woudn’t want to tell them your trying to buy the house for 50k so you can flip it for 100k but you want to make sure you don’t directly misrepresent yourself. Tell them your trying to work with the sellers bank to try and work a short sale and sell the house so the sellers credit does not get ruined (which is absolutely true). If you’re the realtor or sometimes I have my bpo agent meet the banks bpo agent they can tell the banks realtor or appraiser that they are a realtor and are trying to work a short sale with the bank. WORD OF CAUTION!!… make sure this person understands what is trying to be accomplished. It’s best to start out doing bpo’s yourself. This is the hardest thing to outsource in this business!. The script for when you 1st meet the appraiser at the bank would go something like this…..

You: Hello sir how are you today. I bet you’re doing a lot of these preforeclosure bpo’s. These dang things are everywhere!

BPO agent: Yeah you’re telling me. This is my 12th one this week.

You: I bet (go ahead and be semi passive and let them into the house also its usually better if you arrange it so the seller is not present when the house is being appraised)

You: I am trying to work out something with the homeowner so they don’t lose their house to foreclosure. It’s really a sad story; the seller got laid off 3 months ago and can’t find any work. He just wants out of this house so he can move on. I sent an offer to the bank for 150k. We have the house listed to try and get a higher offer but have had no success. You can see that its been on the market 45 days. We have only had one showing. I had initially thought it would have been worth more but now I’m not so sure. This market keeps getting worse and worse!

BPO agent: Yes I know it’s really tough. Good news is I have plenty of work as long as I start knocking these things out.

You: Good. I have some comps and market condition that I have here for you. You will see that a few of these comps had seller concessions which kid of brings the true value of the property down. I already called the listing agent to verify this for you. The comps are coming in at around the 170’s but with the market where it is now and the fact that we have had very little action I think it may be difficult to sell the property for much more.

BPO agent: Ok I appreciate the indo

You: Thanks! Call me if you have any questions.

And that it. Now obviously it’s not going to go that smooth very time. Sometimes the agent/appraiser will be very stand offish and other times they will just ask you “where do you need this to come in at?”. It’s impossible to close every short sale deal and assuming you have your short sale business set up properly the ones that you don’t close will normally be because the bpo came in too high.

-Nathan

{ 0 comments }

Beating Up a BPO!! (Part 3)

by Nathan Jurewicz on August 18, 2008

Another trick is to take all of the sold MLS comps and call the real estate agent that sold the property and say something like “ I see that you sold a house last month located @ 123 main street. I am working on a short sale in that same area and wanted to find out if there were any seller concession or credits from the seller to the buyer that were included in the purchase price?”

Most real estate agents are happy to give you that info over the phone. When you are sifting through your sold comps pay close attention to “sold terms”. If its cash don’t even waist your time calling because odds are there were none. If its conventional call and especially if it FHA definitely call.

Almost all FHA loans have a concession and sometimes have 6% of purchase price and 3% down payment assistance. On a 200k house that’s an adjustment of $18,000 on your bpo. If you don’t have a bpo prepared when you meet the appraiser out there make sure you write down the amount of the concession right next to the sold price. This can be just a little hand written note that says “200k purchase price, 12k concession 188k “true” purchase price.

A lot of times the agent or appraiser will thank you for doing all of this leg work for he/she.

-Nathan

{ 0 comments }

Beating Up a BPO!! (Part 2)

by Nathan Jurewicz on August 17, 2008

What to take with you when preparing for the bpo?

- Contract

- Hardship letter

- Active Listing of subject property

- 3 lowest comparable active listings in area

- 3 lowest comparable pending sales

- 3 lowest comparable sold mls comps

- Any other low fsbo comps if applicable

- An estimate of repairs (unless the house is immaculate)

You can also have your own bpo done by a qualified agent. You want to make sure that you don’t do anything unethical that would bring the value at an unrealistic low number. You would give your bpo agent (the one that works for you) some comps and tell them to appraise it and make remarks somewhere in the bpo that the value is a 30 day quick sale value. Make sure they make adjustments for everything (especially declining market conditions) on the house.

- Nathan

{ 2 comments }

← Older Entries

Newer Entries →