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Archive for January, 2011

Oakland County MI Seller- When Foreclosure May Be Your Best Option

If you need to move, and you’re upside down on your mortgage, short selling your house isn’t always the best option. Sometimes bringing the difference to closing is best. Sometimes renting your house out instead of selling is your best option.

And sometimes letting the house foreclose is your best option.

I had a call from someone yesterday who wanted me to find him a house to lease. He had a “short sale specialist” lined up to list his current home. After talking a bit he told me his house had already sold at sheriff’s sale this past December, so while we were on the phone I looked it up in the public records. The bank had bought it back for $130,000. I asked what he owed- less than $120,000.

THERE IS NO DEFICIENCY!! Nothing for the bank to come after him for over the next 10 years. Foreclosure or short sale– both screw your credit and either way he’s looking at 2 or 3 years before he can get a mortgage. So why would he want to go through the headache of a short sale? Why not live out the next 5+ months rent free and save his money, THEN find a rental? Why didn’t the “short sale specialist” give him his options? That last question will be the topic of a future post.

Other times a person may want to consider allowing their house to go into foreclosure instead of going through the hell of a short sale is when you are planning in filing bankruptcy. If bankruptcy is possibly in your future, you need to talk to a bankruptcy attorney before signing a listing.

In Michigan you have possession of the house for 6+ months after the sheriff’s sale and if you are on 3+ acres you have 12+ months rent free.

Everybody’s situation is different and there is no one size fits all solution. If you have any questions about possibly selling your house- short sale or regular sale, please feel free to contact me for a confidential consultation.

Jackie Hawley
Keller Williams Realty
cell: 248-736-6407
email:
Jackie@JackieHawley.com

www.MiRelocation.com

Seller Blog

For Sellers

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Oakland County MI Home Seller- The Short Sale is Subject to YOUR Approval Too

houseWhen you sell your home via short sale in Oakland County MI or Lapeer County MI one of the contingencies in both your listing agreement and purchase agreement will be (should be) “subject to seller and lien holder approval of short sale.”

The bank or banks can approve the short sale, but if you aren’t happy with the terms under which the bank approved the short sale, you don’t have to close. Sometimes foreclosure is a better alternative than a short sale. To be fair to both your agent and potential buyer,  you should discuss the alternatives with you agent, an attorney familiar with bankruptcy, and your accountant if you have one, prior to listing your house. Once you make that informed decision to list, you need to be prepared for what may happen. Some basics you should know about short sale:

 

  • You’re not just walking away from the deficiency without consequences unless it is negotiated with the bank or banks
  • You may have to bring money to the closing or sign a note for a portion of the deficiency in order to get the lien holder(s) to release you from liability for any deficiency
  • In Michigan the bank(s) has up to 10 years to come after you for the deficiency if it isn’t taken care of when you sell
  • If the house is sold at sheriff’s sale for the same or more than you owe there is no deficiency to hold you liable for (providing you have only 1 mortgage)

My job as a listing agent, when representing a short sale seller, is to price the home in a manner to obtain an qualified buyer at a price and terms the bank(s) holding your note will take. It is also my job to negotiate terms that are acceptable to you the seller- mainly dealing with the deficiency so you don’t get sued later. Sometimes the banks will just release you of responsibility because of my sunny personality! Sometimes they will want you to bring money to the closing. Sometimes they will want you to sign a note. Sometimes they may require money and a note.

When we meet the first time, I need you to be totally forth coming. I will not judge you. I need to know broke homeownerthe reasons you’re selling, your debts, your income, I’ll take a DNA swab- not really regarding the DNA but you get the idea. I need you to be totally honest. And I will be honest with you. I will let you know what I think you should expect. I will discuss various negotiating techniques I have found to be quite successful in bringing the short sale to a conclusion that is favorable to everybody. And I will tell you if I think you would be better off meeting with a bankruptcy attorney. Bankruptcy is NOT a dirty word! Foreclosure is NOT a dirty word!

This is the second in a series of posts about selling a short sale listing. I will be writing posts in the near future that will discuss negotiating techniques, pricing strategies, what to look for in a buyer, and post on when foreclosure may be the best option for you.

Please don’t hesitate to contact me with any questions about selling your North Oakland County or Lapeer County MI home.

Jackie Hawley
Keller Williams Realty
cell: (248)736-6407
email:
Jackie@JackieHawley.com

Is a Short Sale the Right Course of Action for You?

For Sellers

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Could Incomplete MLS Listings Be To Blame For Bad Appraisals?

houseI was reading a letter from our outgoing board president, John Burt, published in our monthly board publication. In the letter he writes about appraisals and mentions that appraisers read the remarks we put in the MLS profile sheet. He goes on to write: “That information can make a difference in value, not just for your listing, but other comparables. If you have a “dog” of a listing, please don’t describe it as a palace, because that could be a future comp for a true palace that gets listed.”

He’s right. And after doing several market updates recently I came to the conclusion that the problem isn’t puffing our listings. It’s incomplete or incorrectly filled out listings. The example I’m going to use is my year end sales data for Lake Orion (the lake located in Lake Orion, MI).

In 2010 there were 27 solds reported in the MLS for lakefront homes on all sports Lake Orion. 12 bank owned homes, 3 short sales, 12 regular sales.

10 listings- or 37% of the total lakefront sales– had absolutely no description of the house. A description lazy listing agentsis NOT “This is a Fannie Mae HomePath property, purchase… blah blah… highest and best offers are due by….”. On THIRTY SEVEN FRIGGIN PER CENT of the sold lakefront listings on Lake Orion the listing agent made ABSOLUTELY NO ATTEMPT to “sell” their listing to other agents. Because that IS what the MLS is for. To sell your listing to other agents so THEY can sell it to their buyers.

But it gets worse. If an appraiser is going to search for solds on Lake Orion you would think he would (should) be able to search X price range, check the lakefront search field, and fill in the water name search field with either Lake Orion or even Orion. If an appraiser did that for sales in 2010 he would have missed out on 7 of the sold listings- or 26% of the sold lakefront homes on Lake Orion. ALL of the listings that had no water name filled in had no description except how to submit the offer. ALL of those listings that had left the water name search field blank and didn’t bother to fill in the description were bank owned homes.

Now I showed many of these homes. Some were in pretty good condition. Some were outright dumps. Some suffered from delayed maintenance. But unless an appraiser had been in those homes, he would have no idea of the condition and no basis for adjustments.

Not only does half assing your job as a listing agent affect appraisals, it is affecting how much work a buyer’s agent has to go through just to be able to include all appropriate, available homes for our buyers. In Lake Orion it’s not so bad to read through 30 or so active listings but try finding a lakefront home in Waterford or Clarkston. Lake Oakland covers both Waterford and Independence Townships. When I update my sales data for Lake Oakland I will probably have to read through over 200 listings since 20-25% of all lakefront listings in our area seem to have the water name search field left blank.

Should appraisers do the same as I am, and read through a couple hundred listings to find the 3-6 comps they use? Yes- they should. A lot is riding on the outcome of their appraisal, and an inaccurate appraisal can mean financial devastation to a seller. DO appraisers go to those lengths for the $300 or so they make on an appraisal? I doubt it.

So listing agents- especially REO agents- Please Please Please start doing your job and fill out your listings completely and accurately. If you can’t at least do that minimal part of the job, please do us all a favor and quit this line of work.

Jackie Hawley
Keller Williams Realty
cell: (248)736-6407
email:
Jackie@JackieHawley.com

For Sellers

Oakland County MI Lakes

Lake Orion (the lake)

Why Are Appraisers Calling This a Declining Market- Prices Are Up Inventory is Low

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oxford lakes oxford mi homes for saleOxford Lakes, Oxford MI- More Distressed Sales But Prices Still Stabilizing

In 2010 there were quite a few more sales in Oxford Lakes than in 2009, but there were also more distresses sale – short sales and foreclosures. In 2009 foreclosures and short sales made up 44% of the total sales in Oxford Lakes and in 2010 they made up 65% if the total sales. But despite the fact there were quite a few more bank owned and short sales the prices seemed to be a bit higher than last year.

2010 unit sales – 23
2009 unit sales – 18

10 bank owned and 5 short sales in 2010
7 bank owned and 1 short sale in 2009

In 2010 sale prices ranged from $119,178 – $350,000
In 2009
sale prices ranged from $77,900 – $400,000

2010 there were 6 lakefront sales (Oxford Lake) ranging from $135,000 – $350,000
2009 there were 3 lakefront sales (Oxford Lake)- $242,000, $300,000 and $400,000

oxford lakes sales

2010 there were no sales under $100K, 2 in the $120’s, 5 in the $130’s, 1 for $140K, 6 between $150K and $200K, 6 in the $200’s 

2009 there was 1 sale under $100K, 3 in the $120’s, 2 in the $130’s, 3 in the $140’s, 3 in the $150’s and none from $160K and $200K, 3 in the $200’s

Detailed chart of Oxford Lakes home sales with addresses, sale type, etc.

There are currently 5 sales pending in Oxford Lakes and 4 active listings for sale ranging in asking price from $124,900-$324,900.

Some of the Oxford Lakes sales in 2010 were half what they had sold for 5 or 10 years ago. 730 Lakes oxford lakes oxford mi homes for saleEdge, for example, is a lakefront home that recently sold for $177,000; it sold for $410,000 in 2003. 867 Bay Pointe Dr sold for $255,000 in 2010 and had sold for $450,000 in 2000.

Some of these houses were in pretty rough shape. Some were in move in condition. Many of the houses that sold in Oxford Lakes in 2010 were over 2000 sq. ft., 3 or 4 bedrooms, 2+ baths, basements and attached garages.

Oxford Lakes is located in the Village of Oxford MI and boasts 2 parks– 1 2 acre children’s park and a 6 acre park with a basketball court, 2 regulation size tennis courts, volleyball court, picnic tables, grills, gazebo, sandy beach and private boat launch. Oxford Lake is about 115 acres of very clean water– electric motors allowed. This spring fed, ex-gravel pit lake has been stocked with bluegill, bass, walleye and trout. And because it used to be a gravel pit, the lake is fairly deep, clean and most of the lakefront homes have sandy beaches.

Oxford Lakes boasts many amenities such as sidewalks, community water and sewer, entrances onto 2 main roads, close to schools, and easy access to expressways.

Right now is a great time to purchase a home in Oxford Lakes– while many are selling for less than they had in the mid nineties and while interest rates are super low. Oxford MI is in the approved area for Rural Development mortgages which allow qualifying buyers to purchase with zero money into the transaction.

Please contact me for more information about your Oxford Lakes home purchase

Jackie Hawley
Keller Williams Realty

cell: (248)736-6407

Jackie@JackieHawley.com

Oxford MI Homes For Sale

Search the MLS  

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distressed homeownerThere are many distressed sellers in North Oakland County MI. I just did my sales updates for Oxford MI and over 60% of the sales in 2010 were distressed salesbank owned and short sales. I will probably come up with similar numbers when I’m finished with Lake Orion and Clarkston, and the surrounding areas in North Oakland County and Southern Lapeer County seem to be about the same.

One of the numbers that really sticks out is that the bank owned sales are down from 2009 but short sales are up significantly. Because of this phenomenon there has been a HUGE proliferation of so called experts into the field of real estate sales. Agents who couldn’t earn a living in a normal market ran out and got a 2 hour designation and are now “short sale experts.” Attorneys who are seeing their income decline in Michigan’s bad economy are getting into negotiating short sales on behalf of home sellers- attorneys who NEVER practiced real estate law are now “legal experts” in the short sale arena.

Along with all of these new found “experts” is a major influx of mis-information designed to convince desperate home sellers that of course the short sale route is always the best route. Of course if the homeowner, who is losing his house, choses one of the other options available, these so called experts wouldn’t be able to make a pay check off that homeowners misery.

A good real estate professional needs to go over all of the options available to a distressed homeowner along with the potential consequences of the various options. Whether to sell via short sale, give the house back (deed-in-lieu of foreclosure), attempt a mortgage modification or simply allow the house to go into foreclosure should be a decision that has been invested with a lot of thought. Whatever you decide can have a long term impact on your life.

Because of instances where I have felt the seller was getting sold a bill of goods – I have decided to write blood sucking specialista series of blog posts explaining in detail the different options available to the distressed seller in North Oakland County MI and Lapeer County MI. For a quick primer on how the foreclosure process works in Michigan, please visit a post I wrote back in September, 2010.  And one thing that I have discovered over the years- there have always been “experts”, but I can’t remember a time where an agent pigeoned holed themselves like the foreclosure agents and short sale agents of today. Many of the short sale agents only deal with short sale listings. So it is not in their best interest to talk a seller out of the short sale route. I think about 2/3 of my listing appointments with distressed homeowners result in that homeowner NOT listing– with me or anybody else.     

When I have finished my series of posts for the distressed seller, I will paste links to all of them in one blog post for easy reference.

Jackie Hawley
Keller Williams Realty
cell: (248)736-6407

Jackie@JackieHawley.com

Home Seller Blog

What Makes a Good Short Sale Agent

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CCS = SALE PENDING

Tired of calling your agent with homes you find on Realtor.com or on your agent’s IDX site (consumer MLS) only to be told that many of those homes are pending? And many of those same homes are still showing as active a month or two or six later? I would be frustrated and start to wonder if MY agent was lying to me. I would start to wonder if MY agent had another reason for not wanting to even SHOW me those homes.

CCS = SALE PENDING

Your agent isn’t lying. The CCS status is an ACTIVE status and is highly misused. CCS was originally for homes that had an accepted offer subject to the sale of another house. We called that a 72 hour contingency clause, and basically the seller would keep their home on the market and if another acceptable offer came in the first buyer had 72 hours to remove their contingency and go through with the sale (prove sale of their own home or buy without selling) OR back out and the seller would proceed with the second offer.

Fast forward to the day of the short sale!Short sale” is simply another contingency in an offer to purchase. It is a seller contingency and is no different than a buyer contingency of mortgage approval or satisfactory home inspection. It IS a contingency that normally takes longer to satisfy than other “normal” contingencies. The sale is contingent on the seller obtaining a reduced mortgage payoff from their lien holder(s)- reduced enough to accommodate the offer price in the offer to purchase.

CCS = SALE PENDING

At this point a listing agent often changes the listing status to CCS – contingent continue to show. Let me be absolutely clear at this point:

  • The buyer and seller have a fully executed purchase agreement.
  • That purchase agreement contains contingencies just like every other fully executed purchase agreement
  • One of those contingencies is a short sale contingency which can take several months to satisfy

I don’t know why a listing agent would still leave the listing with an active status (CCS is an active status). Does that agent REALLY think buyers will be lining up to place back up offers on a pending home? Are the current buyers so flighty they may walk and lose their earnest money? Or is the original offer so poorly written that the buyer IS ABLE to walk without consequences? Or possibly the listing agent wants to keep the listing with an active status to pick up buyer leads? CCS in the MLS still sends our listings to Realtor.com, MoveInMichigan.com, etc. Or maybe this is just becoming such a common practice that most agents don’t even think and automatically mark their pending short sale listings CCS.

Whatever the reasons:

CCS = SALE PENDING

Search the MLS (skip over the CCS listings!)

What Makes a Good Short Sale Agent

The Short Sale Approval is Also Subject to the Seller’s Approval of the Short Sale Terms

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independence oaks county park clarkston miIndependence Oaks County Park, Clarkston MI Offers Something for Everybody Year ‘Round

The last couple summers I took my continuing education (6 hours/year for license renewal) at Independence Oaks County Park with another real estate office. There is no better way to learn dry legal updates than in the middle of 1100 acres overlooking a lake.

Independence Oaks County Park is located at 9501 Sashabaw Rd, Clarkston MI about 2 /12 miles north of I-75 exit 89.

Independence Oaks consists of 1088 acres with 68 acre Crooked Lake, about 10 miles of marked natureindependence oaks county park clarkston mi and ski trails, overnight camping area, boat launch (non motorized boats) and boat rental. Picnic areas, ball field, sand volleyball courts, playground. horseshoe pits…

For the bird lover Independence Oaks boasts an extensive bluebird trail and from March through August you have a good chance of seeing both bluebirds and tree swallows. More than 150 species of birds have been sighted here.

Independence Oaks also offers restrooms with flush toilets as well as port-a-johns.

independence oaks county park clarkston miThe Lewis E. Wint Nature Center offers exhibits and year-round educational programs conducted by park naturalists. The Cohn Amphitheater accommodates 150-200 guests, and the Rubach Sensory Garden boasts a gazebo and water garden. 

Independence Oaks County Park is just one of the many attractions that makes living in Clarkston MI and the surrounding areas a desirable proposition. You can “vacation” after work or on the weekends and never really leave home.

Independence Oaks State Site

Independence Oaks County Site

Clarkston MI Homes for Sale

Oakland County MI Area Information and Homes for Sale

Search the MLS 

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