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No money, no credit – but an honest desire to succeed? 

That’s all it takes to get into the lucrative business of

finding and flipping short sale properties.  We’ve had

people go from zero to six figures in less than six months! 

See if there’re any spots left for this webinar this

Sunday at 8:00 PM ET, 5:00 PM PST:

https://www2.gotomeeting.com/register/386978354

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BOA loosening short seller policy

Bank of America (BOA) says it will relax its policy on payoffs connected with short sales.  Large banks have been demanding money for home equity lines and second mortgages that would otherwise be worthless if the short sale property went to foreclosure.  BOA has been among the least cooperative of all banks in agreeing to short sale payoff terms, demanding 10 percent of what the homeowners owed on the equity line balance or second mortgage before signing off on the short sale, which is necessary for the deal to go through.  BOA spokesman Terry Francisco says the new policy is “less arbitrary, more rational.”

New policy

BOA’s new policy is to ask for five percent of the sale proceeds on the short sale, net of realty commissions, closing, and other costs. Some short sellers point to problems, though:  The bank’s previous 10 percent policy meant they’d demand $20,000 on a $200, 000 equity line balance, but under their new policy it will cost the short seller $15,000 if the net proceeds are $300,000″ on a short sale, even though the economic value of their holding may in fact be zero. Says the Realty Times:  “Bottom line for investors: If there’s a Bank of America second mortgage or credit line on the house you’re after in a short sale, work the new numbers.  At least some of the time you might be surprised that the answer from the big bank is now ‘yes.’”

MBA Chairman testifies

David G. Kittle, CMB, Chairman of the Mortgage Bankers Association (MBA) testified yesterday in front of the House Financial Services Committee at a hearing on H.R. 1728, the Mortgage Reform and Anti-Predatory Lending Act of 2009.  He expressed reservations about some aspects, including the patchwork of state and local mortgage lending laws and the requirement that lenders retain at least five percent of the credit risk of non-qualified mortgages.  According to Kittle, the risk retention provision would make it impossible for many lenders to compete, lessening credit availability increasing costs to borrowers.  He also asserted that the definition of “qualified mortgage” was too restrictive, including in its present definition some jumbo loans, fixed 25 – 40 year mortgages, FHA, VA, and even some Fannie and Freddie mortgages.

Freddie Mac grows portfolio and delinquencies

Freddie Mac, announced that its mortgage investment portfolio grew by an annualized 65.8 percent rate in March, while delinquencies on loans it guarantees accelerated.  Its portfolio increased to $867.1 billion, for an annualized 31.0 percent increase year to date, up from  $712.5 billion in March 2008.  The delinquencies that increased stress on the company’s capital jumped to 2.29 percent of its book of business in March from 2.13 percent in February and 0.77 percent in March 2008.  Freddie Mac said the temporary suspension of foreclosures, which expired on March 6, contributed to the increase in single-family delinquency rates.

Durable good sales fall again

The Commerce Department said today that new orders for U.S. durable goods slipped 0.8 percent in March, falling for the seventh month out of the last eight, even though the fall was less than expected.  Analysts polled by Reuters had forecast orders for long-lasting manufactured goods to drop 1.5 percent.  Anna Piretti, senior economist at BNP Paribas in New York says, “I wouldn’t really read this as positive news, but clearly I would say the momentum is less negative than we saw a couple of months ago.”  Where have we heard that before?

Now on to our real estate investing education section…

Ride the Green Tide: Timely Short Sales Tips

Short sale investors searching for unique ways to differentiate their property from the competition need only go green. Whether or not you are a tree-hugger or simply business savvy, riding the green tide is an excellent way to attract the attention of prospective buyers, qualify for potential tax breaks, take advantage of tax credits and actually increase the selling price of homes in your portfolio.

Use these calculations to determine if it is worth the time and money to transform a former energy hog into a lean, green energy efficient money machine:

Tally up the total cost of the improvement including labor, taxes and supplies.

Discount city, county, state or federal tax incentives or other credits you may be eligible to receive.

Calculate the long term potential energy savings as compared to standard builder’s model of the same item. Be sure to quantify this in very specific terms for each upgrade put into place. For example, let’s assume you install a new water heater expected to save an additional $20 per month or $240 annually. Over a 30 year mortgage that water heater would save $7,200 in energy costs alone.

Since most people don’t think that far ahead also include a five to seven year calculation…ie, in five years it would save an additional $1,200. Do this for each item in the home to show potential buyers how buying your home makes financial sense both today and in the future.

Add up the five, seven and thirty year savings then do a little bragging. Don’t assume it is obvious…make it a selling point to show how cost effective this home is compared to others on the market.

Get creative. Often some of the best ideas cost the least. For example, changing bulbs to energy efficient models is an inexpensive modification that adds significant savings to the bottom line of buyers. Here are a few other green ideas to get you started:

Appliances – stove, refrigerator, dishwasher, microwave etc…

Lighting – search for florescent and/or LED

Water Heater, Pool/Jacuzzi Heater

Local landscaping – less water and less time

Tile floors – easy to keep clean and never need to be replaced like carpeting

Ceiling fans, whole house fans and other alternative cooling methods

See you at the top!

Chris McLaughlin

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

P.S.

Don’t miss our webinar Sunday at 8:00 PM ET, 5:00 PM PST:

https://www2.gotomeeting.com/register/386978354

Copyright Loss Mitigation Institute 2009.
All Rights Reserved.

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Finally, a blog for Real Estate professionals
that want up-to-the-minute news, & how it impacts
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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

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