Avoiding Foreclosure

The Treasury Department has released guidelines and forms for its new Home Affordable Foreclosure Alternatives Program (HAFA), which will help homeowners who are unable to retain their home under the Home Affordable Modification Program (HAMP). Under the new HAFA program, a borrower (the current owner) may be able to avoid foreclosure by completing a short sale or a deed-in-lieu of foreclosure (DIL).

The new HAMP program provides some new very important guidelines to assist Borrowers avoid the devastating consequences of a Foreclosure. Some of the important aspects of the program are noted below.

• Use borrower financial and hardship information already collected in connection with consideration of a loan modification under HAMP. Use standard processes, documents, and timeframes/deadlines. This will dramatically decrease the amount of time it currently takes to Approve a Short Sale                                                                           
• Allow borrowers to receive pre-approved short sales terms before listing the property (including the minimum acceptable net proceeds).

• Require borrowers to be fully released from future liability for the first mortgage debt and if the subordinate lien holder receives an incentive under HAFA, that debt as well (no cash contribution, promissory note, or deficiency judgment is allowed). Being fully released from future Liability from the mortgage debt is Huge.
• Provide financial incentives: $1,500 for borrower relocation assistance; $1,000 for servicers to cover administrative and processing costs; and up to $1,000 match for investors for allowing a total of up to $3,000 in short sale proceeds to be distributed to subordinate lien holders (on a one-for-three matching basis; up to 3% of the unpaid principal balance of each subordinate loan).

Click Here  to read the complete article written by Jeff Lischer for RISMedia.

Foreclosures in Florida

An article by Duane Marstellar of Bradenton.com revealed that Florida will be creating a state-wide managed mediation program designed to help more homeowners avoid foreclosure. The Florida Supreme Court has directed judges to refer all new foreclosure cases involving primary residences to mediation, in hopes of easing a glut of foreclosures that is clogging the court system. More than 456,000 foreclosure cases currently are pending in Florida, which has the nation’s highest foreclosure rate. Read more of this article to find out the guidelines for this new program.

Click Here  to read more of this article.

According to the SunSentinal, 35,000 South Florida homeowners have gotten a mortgage loan modification under an

No money to pay the Mortgage

Obama administration program designed to reduce foreclosures. But that is less than 5 percent of the borrowers who qualify for them.

Click Here to read more about it in this SunSentinal article.

If you or someone you know is having difficulties making their mortgage payment, or facing possible Foreclosure, please call us at 305-408-9200 for a free no Obligation consultation to discuss your Options.

Weighing Your Options

Weighing Your Options


The Making Home Affordable has two key components, lowering interest rates on an existing mortgage and refinancing with a new mortgage. A key point is that the program does not lower the principal, only the interest rates. This article from RisMedia outlines some Guidelines on who may be eligible. Click Here here for more information about the Making Home Affordable program. Those who are truly desperate, such as those who are laid off and have no savings, do not qualify. 

If you or someone you know is facing financial difficulties and possible foreclosure, please call us at 305-408-9200 for a free, no obligation consultation. You don’t have to face your hardship alone!


The Making Home Affordable Program is moving forward slowly. A recent report reveals that only 4% of applicants receive a permanet modification. The government is keeping the pressure up to convert more mortgages. Click Here to read the entire article from RisMedia.

US Treasury encourages Short SalesUnder the plan, borrowers will receive $1,500 from the government for selling homes for less than the amount of their mortgages. Mortgage-servicing companies will get $1,000 for each completed short sale. Second-mortgage holders can receive up to $3,000 of the sales proceeds in exchange for releasing their liens. Investors who hold the first mortgage can collect up to $1,000 from the government for allowing the payments.

Borrowers who complete a short sale under the program must be “fully released” from future liability for the debt, according to the guidelines.  The program does not take effect until April 5, 2010, but servicers may implement it before then if they meet certain requirements.

Click Here to read more on the article from Realtor.org

Current prices are money in the Bank

Oversold Real Estate


While the media continues with bad news about the real estate market, working in the trenches is revealing a totally different picture. Yes home prices are continuing to slide, but real inventory is becoming increasingly scarce! Well priced homes that are in great condition, including foreclosures and short sales are selling within days of being listed. Under priced foreclosures are receiving multiple offers some times as many as twenty offers and many of them cash! Buyers are bidding these – homes up to over asking price. Market value for any home has a range from low, the medium sale price and the high. These foreclosures are selling from the medium to the very high of market value depending on location and condition. Every one seem to think that most of the Buyers are due to the $8000 Tax Credit, which much of it is, the problem with that scenario is where are all these CASH Buyers coming from? Cash Buyers are outbidding other Cash Buyers in their pursuit of a great deal. Buyers are far to concentrated on making an offer below the asking price, which is what they perceive to be a great deal, the problem with that is when houses are selling below $100 a square foot they are already selling for below construction cost and that price does not include the lot! So the great deal is already built-in to the oversold prices.  

Here is an example of what I am talking about. Amex on Monday had a promotion for a BMW 328. The promotion price for a $34000 car was about $19000. Trade in value or cost to replace is $30000 according to Kelly Blue Book. There were only three cars available at that price. How many thousands probably hundreds of thousands of Buyers tried to their very best to get that great deal on a Depreciating Asset! Real estate on the other hand is an Appreciating Asset which historically doubles in value every 10 years.  

 The question is how long is it before the pent-up demand to purchase homes starts driving the prices up from the oversold prices we are seeing today? I am not talking about the levels of price seen in 2005, I am talking about the cost to replace the home in today’s economy, cost to build including the lot which is what it would cost a Builder to build the home not including any profit.  

Yes, I know that real estate is a function of supply and demand as is any other commodity. The difference with real estate is that it is a home that you can live in and enjoy while it appreciates in value. you can’t live in that 2% CD in the bank, you can’t live in your gold and silver positions, you can’t live in any other commodity except real estate. I am not saying that real estate is poised to soar in value, what I am saying is that at some point the market has to come back to replacement costs!  I also don’t mean to infer that prices are going to soar in the coming months and years. Due to the exaggerated run up in the market from 2000 to 2005 this market cycle will probably be a much longer cycle than usual with prices continuing to slide although at a much slower rate. Once prices stabilize they will probably move sideways as all the foreclosures and short sales get bought up. Once all of that inventory is bought up prices will resume the normal price appreciation of a real estate cycle. 

If you are currently behind on your mortgage payments, unable to get a mortgage modification, and experiencing a hardship as defined in Acceptable Hardships ( click Here, ) this is the time to get your home on the market and avoid the consequences of Foreclosure!