Adam Brett's Blog - All Things Real Estate in Fullerton and Beyond

After twenty years of steady revitalization, Downtown Fullerton is experiencing a "renaissance" evidenced by a growing number of sidewalk cafes, specialty restaurants, unique shops, entertainment venues, and upscale apartments.

Downtown Fullerton offers a rustic old town atmosphere with a cluster of more than 70 historic buildings, beautiful shade trees, and decorative walkways, providing a comfortable setting to gather with friends, enjoy music, and catch up on the latest news. Downtown is equipped with more than 2,500 "free" public parking spaces to support the over 350,000 square feet of retail and more than 275,000 square feet of office space.

Downtown is more than just another shopping center - it also serves as a vibrant cultural center with facilities, such as the award-winning Museum Center, the Downtown Plaza, and Plummer Auditorium. It is also home to financial, religious, and governmental institutions, as well as a bustling regional transportation center that serves more than 350,000 passengers every year.

Adam Brett
RE/MAX NOC
714-496-8116
800-977-ADAM
realtoradam@gmail.com
 

Help IS available.
There are a variety of reasons Homeowners face foreclosure but luckily there are options available to avoid the impact of a Bank foreclosure. If you are lucky enough to have equity in your home, you can sell at a price that will let you pay off your mortgage and hopefully have money left over to walk away with at closing.

But - Do you owe more than your home is worth?
If the current market value of your home is less than the amount owing on the mortgage, the answer is a Short Sale.

There IS a way out.
Let me help you find a Buyer, negotiate a short sale on your property with your mortgage company and you can walk away with your home SOLD, no foreclosure on your credit report and your head held high. Your home was sold, not foreclosed on.

And it won't cost you anything!
Mortgage companies understand that if Homeowners are having financial difficulties, they are in no position to pay commissions and other expenses on the sale of the home. The sales contract should be written to protect you, to ensure that the mortgage company will pay ALL the Seller's usual closing costs, including Realtor commissions, state documentary stamps, title insurance, title company's fees and other expenses

Why do they do this?
A foreclosure is a lengthy, expensive process and mortgage companies are looking for alternatives to end up owning a home they have to maintain, pay taxes on and maybe end up having to sell at auction for an unknown price.

Are there any negative consequences?
If the Lender is "forgiving" you the difference between what they are receiving from the agreed upon Short Sale price and the balance you owe on the mortgage, there is a possibility of the Lender of not filing a deficiency judgment against you. The protection against this is to have the contract written so that if the Lender accepts the offer they agree not to pursue you in any way for any outstanding balances, pre payment penalties, late charges, interest and legal fees. Our contracts have been approved by a real estate attorney to ensure your interests are protected. We also advise Sellers to consult with their own attorney and accountant before signing any contract.

What about tax implications?
Until the passing into law of the Mortgage Forgiveness Debt Relief Act of 2007 Sellers of pre foreclosure homes faced the possibility of receiving a 1099 on the "phantom income" forgiven on the mortgage. The law removes that requirement but only for a principal residence and with certain restrictions. Again, Sellers are strongly advised to discuss their tax status with a qualified accountant or tax attorney when they are facing foreclosure or considering a Short Sale. (This has been sign by Pres. Bush last December 2007 ( http://www.whitehouse.gov/news/releases/2007/12/20071220-3.html)

Credit implications
There are 2 main reasons to consider a Short Sale.
Firstly, a Short sale is quicker than a foreclosure and allows the Sellers to move on with their lives knowing the cloud is behind them and that their home was SOLD, not foreclosed on.
Secondly, the credit impact of a Short Sale is much less than that of a full foreclosure. It is estimated that a full foreclosure can impact a credit score by as much as 200-300 points and take 3-4 years to recover from whereas a Short Sale has a credit impact of between 80-100 points which can be restored within 12 - 18 months of good credit management.

Call Adam Brett for all your Real Estate Needs

714-496-8116
800-977-ADAM

RE/MAX  

As I sit today at my open house on a day with 81 degree weather, blue skies in Southern California I wonder why no one is visiting my open house.

Last weekend on Saturday I had over 65 people through.  

Could the weather be too nice? I didn't think that was possible.   

I have about 40 signs out directing people from all directions.  There are a couple other open houses with a block or two so even more signs from other Realtors are out there.

With the buzz of the stimulus package and the amount of REO properties active, buyers are chomping at the bit.  I get multiple sign calls daily.

So where are the buyers today? 

Every Year in February we see a jump in Buyer activity and an overall reduction in inventory.  This year is no different.

Most buyers who have been on the fence for the last year are seeing great interest rates, a choice of whose from which to choose, and prices significantly lower than anything in the past 2 years.

If you are a seller, do not wait for a foreclosure to become active on your street.  It will drop the comps for the neighborhood and buyers know this.

The number of distressed properties continues to increase, and this ultimately means more short sales and Bank Repos.   For some reason people forget Real Estate is cyclical and you can look at previous down trends which will show we are not at the bottom.  

The longer you wait to list your home the more downward pressure you will see.

Be realistic about your price and have an agent who will AGGRESSIVELY market your home. 

With everyone emphatically happy with the stimulus package I don't want to spoil the party but am I the only one who sees a parallel with the lending problem we are trying to get out of?

Let me explain.  With an increased conforming loan limit will inevitably bring buyers into higher priced homes who cannot afford them.  They will get ARM loans - which are conforming - and get a mortgage they can afford for now.

The bill expires at the end of this year.  So, when people need to Refi their now JUMBO loan - we will see a whole new wave of foreclosures.

Is there something I am missing?