Real Estate Agent Reviews

Finding an honest, hard working and effective real estate agent to buy or sell your house for you is very important. Using an agent that does not do their job effectively can end up costing you large amounts of money and wasted time. Many agents require their clients to sign a contract to work with them and no one else for 6 months. So, once you commit to working with a realtor, you really want to be sure that they will be able to do everything for you that you are expecting them to.

Why You Need To Read Reviews - Reading many reviews from realtors past clients will give you a good idea of what it's like to work with your prospective realtor, without the risk.

The Review Site You Use Matters - It does make a difference which review site you do your research from. Not all review sites are the same. Many of them are easily manipulated by the real estate agents themselves. You want to find a site that either has a high amount of traffic and therefore, lots of reviews or one with reviews that are monitored by a staff to prevent against manipulation of the reviews.

The Best Review Sites Are Usually Membership Sites - With a membership review site, the site owners have the ability to better monitor the reviews. There are many ways people can manipulate their own reviews, by posting from different email addresses and other ways. With a better managed review site, the quality and honesty of the reviews should be much more accurate.

See my top Recommended Realtor Review Source to find a good real estate agent in your area.

By J. Baker

PressSearch.org

House Value Estimate Online - Get One If You Like Money!

Getting a free house value estimate online could save you time and money the next time you need to sell your home or buy a new home. This article will outline why getting a home value estimate online is very important in this troubling real estate market.

Selling a home is not easy in this difficult real estate market. Some parts of the country are starting to bounce back but most of the markets are still depressed. So how can you sell your home faster? Easy, make sure it is priced properly. The biggest reason homes don't sell fast is that the price is too high for the market. Always get a real estate appraisal before setting the price of your home is you want to get a lot of traffic. I recommend using a realtor who knows your neighborhood and is familiar with pricing homes in your area. Real estate agents will give free estimates so that they can get your listing. I also recommend using one of the many house value estimate online tools and calculators on the internet. These tools use historical sales data to give you an estimate of your home's worth. Don't skip the above steps. Once you have an estimate of your home's value you want to set the price a little lower. Yes lower. By setting the price a little lower you get more buyers who can afford your home. This translates into more traffic and hopefully more offers. The idea is to get multiple offers which will drive the price about the actual value of the home.

Buying a home is fairly easy today because the market is so good for buyers, but you still need to get an appraisal before making an offer. Use the methods outlined above and then base your offering on this value. Don't base the offer on the listing price.

By Jordan Ashton

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What Home Improvements Add Value to Your Property?

When was the last time you had an idea to upgrade your house? Have you mulled over how you can add some value to your asset by adding some improvements? There are a lot of ways you can actually proceed. You can either use professionals or go about it yourself.

If you think your house needs a basic make over and you are too busy to involve yourself, then you have interior professionals who can come with some great plans. Make sure you have enough budget for this, as these guys can prove to be quite expensive. Of course, they are quite systematic, and can give details which are very critical including projected budget.

If you aim to go the entire process yourself, there are ways to proceed that give you a systematic way of completing the entire process. Doors form an important part of the aesthetics; hence you should start with it. Change the door or polish it, and change the metal fixtures like knobs. Go for some real regal looking knobs and this can give the entire house a very classy look. After you are done with the doors, other exteriors can get some attention. Go the entire process area by area and finally, give the entire house a good coat of paint, and you can have a near new look for your house.

Another way of improving your home is by adding a room or an entire floor. This is technical work and involves architects and masonry professionals. This work has to be done by following some rules and regulations. There are building rules, construction rules, clearances from local authorities and similar clearances to be obtained in case of such a work being undertaken.

The entire home improvements are normally undertaken as a part of a bigger plan. This could either be because of an impending sale of the property or due the family being extended. If it is for selling the property, the improvements can be shallow but should have good aesthetic value. This is because these improvements should be pleasing and attractive to prospective buyers, and should be able to impress them as they come in for inspections. If you are looking to use it yourself, make sure that the improvements add value in terms of utility.

A few ways of otherwise improving your house are by improving your kitchen, which involves up gradation of equipments or aesthetics, though the overall value of the property might not increase as much as the expenses. Another important way is by up grading your energy efficiency. A good energy efficient heating system, apart from giving your property a good selling point, also helps you to add your bit to save energy in the long run.

By Ravisankar Poduval

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Housing Market is Getting Better, Or is It?

Is the housing market ready to rebound? Depending on which statistic you want to believe, it may be, or it might not be. Let's look at some things.

First, on June 16th, the Commerce Department came out with a statistic that said housing starts were up 17%, a reversal of fortunes that have dogged the industry for more than four years. They believe that lower prices and tax incentives are attracting buyers.

But are lower prices and tax incentives attracting buyers? Home sales in both April and May were relatively flat, May even a little lower than April, while home prices were still declining across the board. Prices have been low for at least two years now, drastically low over the last 9 months, and though the tax credit was just signed in February, there was a similar tax credit last year from the Bush Administration of $7,500 that should have sparked sales, but didn't.

Therefore, we can conclude that it's got more to do with other factors than housing prices or tax incentives. Things like unemployment, the cost of energy rising, and the unstable banking situation that's keeping people holding on to their money just a little while longer. That, plus right now 1 in 8 homes are either in foreclosure or have owners who are behind on their payments.

That, and mortgage rates are climbing once again. They're now up around 5.5%, when only a few months ago they were hovering around 4%. The federal government is looking to find ways to bring the interest rates down again, such as purchasing debt, but with other things getting ready to hit banks, including the possibility of merchants negotiating rates directly with Visa and MasterCard, which will possibly take revenue out of the pockets of banks, it's going to be a hard sell.

Still, there are some positive numbers to look at. For instance, housing permits rose 4% from the previous month. Construction of single-family homes rose 7.5%, the third straight monthly gain. Work on multifamily homes, such as townhouses and apartment buildings, jumped 62%. So those are good numbers. Not so good is that home starts are still down 45% from the same time a year ago.

Also, investors are starting to believe in home builders again. Shares are trading higher, and the Dow Jones U.S. Home Construction Index is up 2.21%. Even with that, some analysts are worried that increased construction could add to already-elevated inventory levels, devaluing home prices.

The numbers are dichotomous at best, but comparing them to what was going on six months ago, they are improving; nothing wrong with that.

By Paul Esobedo

PressSearch.org

Should I Buy a House Now?

Oh if I had a nickel for every time I have gotten this question. And it's legitimately the most important questions, as well one of the first ones, you should ask. For the person asking the question, it is a very difficult one. For me, it is one of the easiest questions to answer.

I always tell my clients that their real estate endeavors should be guided by what I call their "life changes". These are (you guessed it) changes in their life that changes their needs for housing. These include such events as:

• marriage/divorce
• having a baby/kids moving out
• needing a good public school
• income going up/income going down
• Inheriting money/ losing a lot of money.

These are the types of changes or catalysts that should guide you through your real estate purchases and sales. Wrong reasons have a lot to do with what a person wants with a sprinkling of ego and include:

• I want to impress people/colleagues/girls
• I want to buy a house to make money
• I want to live in such and such an area
• I want a bigger house
• All my friends own houses

You will notice that the "good" reasons all are in reaction to changes in your life which change your needs, and the "bad" reasons are all in reaction to what a person wants. This may seem obvious now that I have said it, but it is a simple litmus test to see if you should even begin to investigate buying (or selling) a house.

By Jason Reitz

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Can't Sell Your House? Swap It!

In some of the hardest hit markets around the country, homeowners have discovered a creative new way to sell their homes - through online house exchanges. House swapping originally developed as an affordable vacation option, wherein homeowners from different places would get together and swap their homes for a short period of time. This helped both parties reduce their vacation costs, and gave both an insider's view of another community.

The practice of house swapping grew to be quite popular in the 70s, and is rising today in a new form. Permanent house swapping is based on the same idea (homeowners switch places), but in this case, each owner buys the other person's home.

So why are property exchanges becoming popular today? Many U.S. markets are seeing an influx of inventory but not a lot of demand, which makes it very difficult to sell. In addition, the economic downturn has resulted in large numbers of job loss, leaving homeowners struggling to make their mortgage payments.

Those with rising financial pressures are motivated to sell quickly, so they often lower their asking price, and work with a real estate agent. Because times are tough right now, permanent house swapping is a trend that's gaining momentum because it brings together motivated buyers and sellers.

To find prospective swappers, homeowners join one of the many websites dedicated to real estate matchmaking. Sites like OnlineHouseTrading.com, DomuSwap.com, GoSwap.com, and even Craigslist.com allow owners to post an advertisement of their property and specify what they're looking for in return. Some sites are free to use, while others charge fees to access full listing details.

Many of the swapping sites also feature posts from international users, for people who want to look for a home outside American borders.

People who are trying to sell their home on their own, as well as those working with a realtor, are feeling hopeful about online house swapping as a new marketing arena. Hard numbers aren't available yet to tell us how many successful exchanges have occurred, but hundreds of people are joining these sites each month. Of course, the more members each site has, the more potential buyers there are. This increases your chances of having a successful home exchange.

One caveat involved with house swapping is the fact that each party must be willing to live in the other person's area. Matching location, price, and property needs can be difficult, especially if either party has a family that's moving in tow. Another thing to keep in mind is that house exchanges aren't straight trades-some houses simply cost more than others, regardless of whether the property's up for trade or not.

Each homeowner officially sells the house to the other, which means that all the standard paperwork, home inspections, closing costs, and financing issues are the same as in any other real estate transaction. This is why it's still important to have a real estate agent working with you. He or she can take care of the details of the sale, advertise your home using these swap sites, and market the home using other venues.

By Vk Melhado

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It's Easier to Finance a $5,000,000 Apartment Building Than a Single Family Investment Property

Funding has dried up for residential investment property (1-4 family), but it's plentiful for large multi family projects.

1. Funds are available for large multi family properties, but not for residential investment homes.

President Obama said during his Economic Recovery Act Speech, "there is no money available for you speculators" and he meant it. Try to get a loan for a residential (1-4 family) non-owner occupied property and see the results for yourself. There are no more stated income loans available for residential investors. If you have been in the residential investment game for a while, you already know it, if you are just starting out; you will experience this problem on your first residential investment deal. Its cash, hard money at 12% and a 65% LTV or you're done.

The good news is that government backed funds are plentiful for larger, multi-family properties. This presents tremendous opportunities for those who know how to access the funding sources.

2. You don't have to personally qualify for the loan the properties qualify.

Imagine that! Anyone who has ever attempted to purchase a residential investment property (1-4 family) has encountered the issue of personally qualifying. Sure the rents may cover part or the entire mortgage, but the lender only considers a percentage of that income toward your ability to pay the new mortgage. You need, tax returns, financial statements, proof of funds for down payment, etc. Not only that, but of course your FICO score becomes a big factor. Get through all of this and every time you buy another residential property your FICO score drops and you are viewed as more of a risk to the lenders. The more successful you become in this arena, the harder it gets......

With commercial financing, the properties qualify for the loan, not you. The loan is not reported to the credit bureau's. The more successful you become, the easier it gets.....

3. Most loans on large multi family properties are fully assumable.

Ever try to assume a residential loan without having to qualify for it? Not happening, at least not since the early 80's when FHA and VA loans went from "fully assumable" to "qualifying assumable". It's the same as having to secure a new purchase money mortgage, so unless the interest rate is very attractive, it's never done. The first home I ever purchased was a little bungalow for $25,000. It was 1980, I was 20 years old and didn't qualify for a $200 limit MasterCard, but I assumed a $23,000 VA loan, no questions asked. The same criteria hold true to this date for large multi family projects, but very few know about it.

The financing on many large multi family buildings are fully assumable. Remember, the properties qualify not the buyer. You can buy 100 + unit apartment complexes without qualifying, no verification of funds, no credit report, no tax returns, just knowledge.

4. You ARE NOT personally obligated to repay the loan.

Try getting a residential mortgage and tell the lender that you don't want to personally guarantee the loan. Not happening! We are accustomed to all loans carrying personal guarantees. It's incorporated into every residential mortgage, by every lender in the country. Of course they want recourse if you default, they get the property and then have the right to a default judgment for any balance that may be due after they liquidate the property. Residential loans carry "FULL RECOURSE" to the mortgagee.

Larger commercial loans are "NON RECOURSE" to the borrower. The property and its ability to generate cash flow is the lenders security, not you personally.

5. Multi Family Properties are built to CASH FLOW, single family homes are not.

Single family homes are designed, built and price for owner occupants, not for cash flow. Study the numbers on almost any single family home and you will discover that after you pay the mortgage, taxes. Insurance, utilities, maintenance, etc, you will lose money every month. Single family homes are terrible for cash flow despite what the residential guru's on TV tell you.

Multi family properties are designed, built and priced to do one thing and one thing only, "make money". Lenders lend based on the fact that there are sufficient funds to cover the debt obligations, not on what your credit score is, or what the house down the block sold for or what your personal income was last year, etc.....

6. Professionals manage the property- No tenants and toilets to deal with.

With residential investment property YOU generally have to manage it. The property has negative cash flow to begin with; there probably is no budget to hire a management company to run it. You go from watching the guru on TV sitting by the pool telling you how great your new lifestyle is going to be once you buy a couple of homes, to fielding leaking roof calls and clogged drain problems on Saturday nights.

With the larger properties a professional management company handles all of that for you. It's budgeted in just like taxes and maintenance. The lenders require a professional management contract be in place at closing. They handle all the problems; they are staffed for it and deal with repairs, collecting rents, renting vacant units, etc. They send the funds to you. You never have to deal with a single tenant, yet you reap the rewards. Now you have a lifestyle.

There are many more reasons to move from residential to large multi family including dramatically increasing the property's value by simple rent increases, etc. I encourage anyone investing in residential property to take a good look at moving up to larger properties. It's easier than you think when you acquire the knowledge.

By Joe Florentine

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Real Estate Grants - Free Government Money You Never Pay Back

Whether you are looking to buy your first home or you are a seasoned real estate investor, real estate grants can help you finance your next purchase or project. These funds are provided by federal, state and local governments, as well as many private foundations that support the needs of individuals. As a result of applying for and receiving grant funds, you could obtain thousands of dollars in free grant money that never has to be paid back.

What can real estate grants be used for?

Government grants for real estate, as well as private grant money, can be used for a variety of reasons. There are grants for first time home buyers, grant for down payment assistance, and grants for home improvement, just to name a few. There are also grants to:

* Restore Real Estate
* Help Purchase Investment Property
* Provide Mortgage Assistance

Each grant that you apply for has specific function and purposes. By searching an online grant directory, you can quickly identify the grant programs that are currently provided funding and see how much you qualify to receive. Each program has different eligibility requirements, and all the details on how to submit an application correctly is provided with your access to the grant database.

As long as you are at least 18 year old and a tax paying citizen, there are numerous government and private grant money programs that you may qualify to receive. The first step is to review the database to identify those programs, and then submit your application to see how much you can obtain. The funds that are awarded to approved applicants are provided tax-free, interest-free and with no repayment terms.

To find real estate grants, access an up-to-date grant directory to see what funds are currently available for individuals. Apply today and potentially get your first check in as little as 7 days.

=>> Find Available Grants

By David Sklonic

PressSearch.org

HDB Resale Flats - Popular Pasir Ris Corner Units Near MRT

Pasir Ris is one of the most popular residential areas located in the east of Singapore. Comprising District 17 & 18, it is made up of three areas, Central, Loyang (to the East) and Elias (to the west). It offers a variety of housing types, from low density bungalows, to medium density condominiums and cluster houses as well as high rise HDB flats. Although highly sought after, the HDB flats in Pasir Ris are not as tightly packed as nearby Tampines. Moreover, HDB resale prices are slightly lower here as compared to Tampines. Bicycles are a common sight in Pasir Ris because just about every household is within cycling distance to the MRT, shops and the beach/park. This is gives the residents here an enviable live-work-play environment that few other residential areas in Singapore can match.

Situated in a coastal region, Pasir Ris has a resort town feel to it which is seen by the large number of resorts such as NTUC Downtown East, Aloha Loyang Resort and Aranda Country Club. Seaside recreations, over 2 km of parks and beach fronts and lovely green landscapes make this town a wonderful place for families to spend the weekends and vacations.

Some of the most sought after HDB resale flats in Pasir Ris are the corner apartment units. But the highest HDB resale prices are reserved for the corner units near the MRT station. These are the apartment blocks 500-520, 531-536 and 570-586 which are the closest to the MRT station. So, if you're looking for a unit near the MRT station, be prepared to pay a premium.

This HDB new town has a good transport links and it has easy accessibility to both TPE and PIE expressways as well as Changi airport. The MRT station is located at the central area where the Whitesands shopping centre is situated. The government has plans to develop new Rapid Transit Lines to complement the existing East-West MRT line and improve accessibility between Pasir Ris and the surrounding regions.

By Lynn Teh

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REO Asset Managers Contact Information

If you've been combing the net for free asset managers information you've come to find that it's very challenging to find any information for free. You continuously find sites that want to sell you the same recycled information.

There is a very tight lid on asset manager's information.

It's a very hush hush topic in Real Estate, asset managers don't want to be contacted by the masses of agents looking for they're information. Agents that have these contacts aren't going to leak a single contact either. They'll give you story after story about how it's not a lucrative business and it's a lot of work. They're right, it is a lot of work, but it's worth it.

If you look very closely you can find good information of asset managers that can help you make contact with the right people.

There are a few things that you can expect even with the right information.

First

You will get rejected! Get used to it. It's going to happen. Asset manager's first instinct is going to be to tell you to go through the whole sign up process. You will have to be persistent.

Second

Be different. Send good valuable information. They aren't interested on how you get 95 or 100 percent of list price on all your listings. Chances are they would rather you have property management experience. Get some, while you build the relationships with these people. Then, include property management references.

Third

Offer to do free work for the consideration on future assignments. Especially if you can find the right contact for REO properties that have been sitting on the market in your area.

There is a lot more to listing REO's than most agents think.

One thing that is often underestimated and the reason why many agents don't get REO accounts is that there is cost involved. Many are going to expect you to cover the expense of locks, maintenance, board ups, utilities, etc. Be prepared, that's part of the business of REO's. Many agents get accounts and lose them because of this. Also, having family or friends doing the maintenance on properties without first clearing it with company is a red flag that will get you nailed and fired, quickly.

Finally, be part of REO management events, such as REOMAC,

which you probably can't join right now because it's been closed to new members for a while now. There was obviously a flood of new applications, agents looking to have it as a credential for they're registration with asset management companies. These are also good opportunities to meet someone on the inside. The Five Star Conference is also a very good place to meet some of those same people. Check the Five Star website for more information. When you're out, at these events, make friends with REO agents in other states. They will probably be more helpful to you than agents in your own market place. The threat of you taking potential business that they could get won't be there.

I'll continue to update this article or post new articles as I find free information on asset management companies. Its time to loosen the REO monopoly!

Charlie Memen is a licensed Real Estate Broker in Orange County California. He currently operates a Non-Franchise Real Estate company and mortgage company. He regularly holds seminars and classes for first time buyers, real estate and mortgage professionals.

This blog has Free information and its constantly adding new Free information on Asset Management Co. and Contacts.

By Charlie Memen

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Free Online Home Appraisal Estimates - Don't Use Them Unless You Want to Save Money!

Free online home appraisal estimates can save you time, money and a lot of headaches when buying or selling your home. Every home buyer should check the value of the home they are interested in before making an offer and every seller should do the same before listing their home for sale. This article explains why using free online home appraisal estimators will save you money.

Home Buyers - If you plan on buying a home you will need to pay for a professional appraisal before the lender will give you a loan. Unfortunately this is too late in the process. You should always know the true value of the property before making an offer. Many sellers just pick a number to list their home at and buyers then offer slightly under. If the price was too high in the first place, you may think you are getting a good deal, but could be paying too much for the house. Check will an experienced agent who knows the neighborhood or check online at some of the free home appraisal estimate sites, like Home Gain. All you do is put in the address and a little extra information and in a few seconds you have an estimate.

Home Sellers - Before listing your home you should check the free online house websites to see the approximate value of your home. The reason is that the number one reason homes don't sell fast is that the price is too high. If you want traffic then get an experienced realtor to help you decide on an appropriate price but also check the free sites to see if her recommendation lines up with what has recently sold in your neighborhood.

By Max Suther

PressSearch.org

What is Done During a Home Appraisal - What You Need to Know!

Many people ask me, "what is done during a home appraisal?" Well there are a few things you need to understand about home appraisals and what to expect from the appraiser. This article explains what is done during a home appraisal and how to improve your appraisal.

If you are selling or buying a home you should always get an appraisal first. Most buyers will be required to get and appraisal if they are getting a loan. If you are a seller you can list your home for the correct price if you get an appraisal first. The number one reason a property doesn't sell is the price is too high. A professional appraiser will charge between $250 and $600.

The appraiser will come to your home and normally measure your property and house from the outside first. He will take some pictures and note the condition of the exterior of your home. He will then measure the inside of your home and take some more pictures. He will visit each room and note the upgrades your home may have. The entire process normally takes around two to three hours.

After the appraiser leaves he will start doing research on comparable sales in the area. He will try to find three other homes that are much like yours that have sold recently. He will then create a report that will give you a complete understanding of how the appraisal price was determined.

Selling or buying a home? Always get a professional appraisal first. You can also get an appraisal online at some of the free websites or from an experienced real estate agent.

By Max Suther

PressSearch.org

What Does Closing of Escrow Mean?

An escrow account is an account set up during real estate transactions, and is held by a third party, apart from the buyer or seller. Normally, the bank or lending institutions hold these accounts and are responsible for ensuring that funds are transferred from the account as per the agreement executed.

The account is a joint account and has funds from both parties. It is a highly responsible position to be in and not only involves the financial aspects of the transaction. Even the documentation is included in the escrow arrangement and it is the holder's responsibility to make sure that documents end up in the right hands.

Closing of escrow is normally done once all transactions are completed. Once all transactions are completed and related payments are done, the holder of the escrow account produces a statement which carries, in detail, all transactions related to the real estate deal. On this date, the property legally changes hands and the title is transferred from the seller to the buyer. The insurance is also transferred on this day.

An escrow closing is the climax of the transaction. Normally, the grant deed is recorded in the relevant registry within one working day of the escrow holder receiving loan funds. This is the last step which indicates close of escrow. All these formalities are taken care of by an escrow officer, appointed by the escrow holder. After he is satisfied that all conditions have been met, he informs both parties about the closure date of escrow. After the closure is formally done, the relevant papers are distributed and subsequent entries made in the records office.

It is important that along with the officer, your agent is also involved in the closure. This makes sure that no points are left unattended and that payments made are as per agreement. Insurance is always a very tricky and expensive matter, hence needs utmost caution. Your agent can be a real estate agent who knows the documentation of a sale as well as escrow dealings.

The escrow officer follows instructions as per conditions laid out in the agreement. Only after all pre-requisites concerning the property have been met, shall only be funds disbursed to the seller. Escrow account also disburses funds related to real estate agent fees or any other closing fees as deemed appropriate.

As a normal case, escrow is not related to real estate alone. This type of account is also opened in case of major business transactions and deals outside the real estate market as well. Sometimes, funds that are under litigation are transferred to an escrow account held by a neutral party till such time as the destination of these funds are determined by the honorable court of law. These funds are huge and may run into millions or even billions of dollars.

By Ravisankar Poduval

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Home Appraisal Estimate Online - 2 Big Money Saving Tips

If you are selling your home or buying a house then knowing the value of that home will save you tons of money. Getting a home appraisal estimate online could save you time, money and headaches. This article explains why every buyer needs to know the value of the home before making an offer, and why every seller needs to know the value of their house before listing the property.

Buyers - If you plan on buying a home then most likely you will have to pay for a professional appraisal before the bank will lend you money. This is to protect the bank. You should get an appraisal of the house before you make an offer. This will protect you and save you money. Most people list a home not knowing the true value of the home. As a buyer if you get a home appraisal estimate online before you make an offer you will be able to make an offer that is reasonable and based on historical data. I recommend making an offer for 3 percent less than the estimated value of the home.

Sellers - The number one reason a home doesn't sell is because the owners have priced it too high. They normally take a realtor's advice and sometimes pick a number out of the air. You want to make sure you know how much the home is really worth before picking a price. Getting an online appraisal at one of the free websites is a good idea, and getting the value from an experienced real estate agent is also a good idea. Once you have an estimate then make the price of the property a couple of percent less. This will get you more foot traffic and ultimately the home will sell sooner.

By Max Suther

PressSearch.org

Basic Short Sale Q&A

What is a Short Sale?

It is when a bank agrees to accept less than what is owed as "payment in full", in an effort to avoid the foreclosure process. The bank agrees to "write-off" and forgives the remaining portion owed.

Why would a mortgage lender agree to a Short Sale?

-Because real estate and foreclosure laws vary from state to state, the foreclosure process can take a very long time and may tie up both their financial and legal resources as they try to keep up with the different requirements in each state. This lengthy process can be very expensive for the company.

-If a Bank forecloses, the most they can hope for is to sell the property at market value. They would rather just allow a short sale, and avoid having to market and maintain the property themselves.

-Many lenders have to hold cash in reserves to balance the value of the REO properties that are on their books. Many times, this amount can be 3 time the value of the properties themselves. The more money they have to hold in reserve, the less they are allowed to lend. Mortgage companies are in the business of lending money, not selling real estate. They are more likely to just cut their losses with a short sale, so that they can go about their normal business.

What are the requirements to begin the process?

You must be behind on payments
You must have suffered a hardship (not always just a financial one)
You must have little or no equity in the home
And that's it.

Will I be responsible to pay taxes on the amount forgiven?

You may be exempt from having to claim the forgiven amount on your taxes under the "Mortgage Forgiveness Debt Relief Act of 2007".

By Joshua Talayka

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Real Estate Contract Contingencies - What You Need to Know

What Are Contingencies in a Real Estate Contract?

A contingency is a formal clause in a real estate contract that enumerates particular conditions that must be met by either the buyer or the seller in order for the principals to proceed to the next step in the contract. Found in every offer-to-purchase or sell contract, contingencies protect the interests of both buyers and sellers. Failure to meet a particular contingency can result in breach of contract and possible penalties to the party at fault.

Basic Contingencies in Real Estate Contracts

Contingencies are divided into categories according to their purpose:

(1) protection for the seller

(2) protection for the buyer

(3) mutual protection of both buyer and seller. Most real estate contracts contain two universal contingencies: a mortgage contingency and a home inspection contingency.

Mortgage Contingency - The mortgage contingency stipulates that the buyer will make every effort to obtain a mortgage for a particular amount, at a prevailing interest rate within a specified period of time. If the buyer succeeds in obtaining a mortgage as described, the mortgage contingency is said to "be removed." If the buyer fails to obtain a mortgage, the contingency is unmet and the buyer may withdraw from the contract without penalty. A mortgage contingency therefore protects the interests of the buyer by releasing him from the contract to purchase if financing is unavailable.

Home Inspection Contingency - This contingency protects the buyer because it allows the buyer to withdraw from a contract without penalty, including the return of any deposits made, if the home inspection reveals the house to be unsuitable because of issues like material defects, significant termite damage or dangerous electrical wiring. If the issues discovered are fixable, the buyer has the right to negotiate the repairs he wants with the seller. In turn, the seller may agree to repair everything, a few things or in some cases, even refuse to make any repairs. If agreement on repairs cannot be reached, the contingency cannot be removed and the contract becomes null and void.

Other Common Contingencies

There can be as many contingencies in real estate contracts as there are needs of buyers and sellers. Even though most contracts are boiler-plate, it is more common than not for additional contingencies to be added depending on the protections needed by the principals. In some states it is perfectly acceptable for the real estate agent representing the principal to add contingencies as needed. In other states, only an attorney can add a contingency.

Attorney Review Contingency - One of the contingencies most commonly added by real estate agents is a 24-hour attorney review. This means that after the contract has been signed by both the buyer and seller, the buyer's attorney has 24 hours to go over the contract and approve it before it becomes official. An attorney review insures the legality of a contract, an important safeguard for both buyer and agent, especially in states where agents may add contingencies as needed.

Sale of Buyer's Home Contingency - Agents refer to these contingencies as Hubbards. A Hubbard can be used effectively in any type of market; however, they are used more often in a slow market than a normal market. A Hubbard contingency allots the buyer a specified period of time to sell his/her current home before buying the new one. If the buyer's current house does not sell within the stipulated time (usually 2-3 months) and the buyer does not want to buy the new house without the sale of his/her old home, the contract to purchase the new house is voided without penalty. This protects the buyer from becoming over-leveraged by owning two homes at once.

There is a caveat, however, that provides some protection for the seller. During the period allotted to the buyer for the sale of his/her home, the seller may continue to market the home on which the Hubbard contingency has been placed. If the seller receives a second offer from another buyer that is more attractive than that constrained by the Hubbard, the seller is free to accept the second offer if the first offeror, after being notified, does not want to proceed to closing.

Reverse Hubbard - This contingency gives the seller a specified period of time to locate a new home after an offer to purchase has been accepted. If a suitable home is not found, the seller may withdraw from the contract without repercussions. Just like buyers, most sellers prefer to sell the home they are in before buying another. If sellers have no pressing need to sell and a substitute home that they like cannot be found, they may decide not to sell at all.

Miscellaneous Contingencies

Contingencies can be as varied as the circumstances require. For example, suppose you are a buyer and you find a nearly perfect home except it lacks the in-ground pool on which you had your heart set. You wouldn't mind installing the pool yourself after purchasing the house, but you have no idea if the backyard is large enough to accommodate a pool that would meet all the town requirements of setbacks from the road and from adjoining properties. Your agent or attorney can write a contingency into your offer to purchase that allows you a specified time to investigate the feasibility of installing a pool and permits you to withdraw from the contract should the yard not accommodate a pool.

Contingencies from buyers can include anything from asking a seller to remove a deteriorating shed to installing a new septic system. Similarly, sellers will sometimes present their own contingencies in their offers to sell like asking buyers to allow them to store, for a specific period of time, a second automobile on the property after the sale or making the offer to sell contingent on closing by a particular date.

There are two main points to remember when using contingencies in purchase and sale contracts. First, multiple or unreasonable contingencies by either buyer or seller tend to weaken the position of each. Sellers should require as little as possible from buyers to avoid turning them off and buyers run the risk of having their offers refused if the contingencies are perceived by sellers as off-putting.

The second point to remember is to work with an experienced and licensed real estate agent and a local real estate attorney to ensure that the contract protects your interests. Once you have secured a tight, tidy contract you can relax knowing that your rights are protected.

By Pat Perkins

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