Name Your Price Weekend, March 20 and March 21st.

One of Dilworth’s most unique  properties…

Home For Sale- Name Your Own Price Sat/Sun 12-3

Historic Home built in 1905.

Location? Third Lot off East Blvd.

Lifestyle- Walk to everything…

SouthEnd, the Lynxx light rail, shops in Dilworth, Latta Park, Harris Teeter Shopping Center, 131 Main restaurant and MORE…

3 Bedrooms ,2 bath, 2 car garage, over 2200 HLA

A Weekend Sales Event- a well-regarded local Inspector will be on-site to answer your “structural” questions,  in time for the first home buyer Tax credit, PLUS, your buyer with an accepted offer by 3/22…

Huge Buyer Bonuses for Offer Accepted by March 22, 2010, Open 12-3. One lucky buyer will receive:

All Local  Moving Expenses Paid

6 Months Cleaning service

A new 50″ plasma TV

Not in the MLS, Buyer Agents Protected, standard commissions apply, so come on by.

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Custom Golf Course Townhome- $324,900, recent comparable sale at $360,000

Fantastic Estate- Gated Waxhaw, Over 1 Acre, 5 Bedroom home with pool

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Charlotte home buyers frequently ask me, which is a better buy, a foreclosure or a short sale?  Which

Short Sale? Foreclosure?

Short Sale? Foreclosure?

is preferable to buy?

That’s 2 big questions, first you will need to know the key differences.   Let’s get started with the basics.

If you are buying a foreclosure, you are buying a bank-owned property, or REO. (Real Estate owned)

This could be owned by the bank itself, or it could be owned by Fannie Mae, or HUD, the companies that bought or insured the loan.  These are non-personal corporate entities, and frequently relatively easy to deal with- easy as long as you follow their rules and jump through their hoops. But you do get answers. And, the sale is being managed by asset liquidators, people charged with selling the property efficiently.

If you are buying a short sale, the property is still titled in the original owners name.

They, the Sellers, will have to submit your offer, as well as their hardship letter and financial s, to the bank, and get the the bank’s loss mitigation department’s approval, before this sale can go through. Why? Because, the Buyer offer amount is insufficient to cover the the existing mortgage, and pay all the expenses (commissions, revenue stamps etc) of sales… so, the lender will have to be willing to take less than the full note amount to satisfy the lien, and this lessser amount is the reason is is called a “short” sale. you will also be  dealing with a bank’s  “loss mitigator” as opposed to a liquidator, and it makes a difference.

What are the advantage to the Seller of the Short sale?

Primarily helping to keep their credit more intact.  The Seller’s credit will suffer with a short sale, but not like a foreclosure, which is more damaging and will hang around much longer.

Advantages to buyers...

Advantages to buyers...

The Advantages to a Buyer

Obviously, you can get a great house for a whole lot less than you could have a year or two ago. Home prices have already fallen back to2003 levels in most parts of the city- if you could then take another 10 or even 20% off that price- wow, that is a lot of house for Not a lot of money- that’s why they are becoming so popular among Buyers. [click to continue…]

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Should I sell in a short sale?

Should I sell in a short sale?

Why Sell Your House in a Short Sale?

What is a Short Sale? A short sale occurs whenever the proceeds from the home sale (Sales price – Cost of sale) are not enough to pay off the mortgage or mortgages, and any liens.  This could be a minor shortfall, a few thousand dollars, or it could be 10’s of thousands, even hundreds of thousands of dollars in some situations. If its a normal re-sale, the home sale proceeds are in the positive- the home seller takes cash with them on the way out. You can see more of the details here at Wikipedia

Why  do short sales happen? It is a combination of falling home prices, low down payments, mixed with folks losing their jobs or having their mortgage adjust to a payment too high… some or all of these, or, in some cases the value loss has been so high, maybe Sellers are just giving up on the house.

Whatever the reason, the Buyers can’t pay the mortgage, and it might be in the bank’s best interest to proceed with a Short sale that might cost them 15-25%, as opposed to a foreclosure that averages 24-26% and occasionally is much worse.

To the home Seller- borrower,  a short sale is vastly preferable to a foreclosure, the damage to credit in a short sale is only a fraction of the damage of a foreclosure.

Home sellers must write a letter of hardship, submit full financial s and then get an offer to submit to the Change- Think it through without fear

Change- Think it through without fear

bank. Once an offer is received- along with the Seller’s package, and a proforma HUD statement displaying full costs to the Bank, the package is then submitted to the bank’s loss mitigator’s for review.

If the borrower is approved for the Short sale, the bank sends other real estate brokers to perform a BPO- Broker Price Opinion, or a mini-appraisal, that provides the lender current market value and  allows the bank to make a decision.

Generally, if the offer is within 15-18% of a quick sale BPO price, the offer is accepted by the bank.

Expect plenty of forms, and hoops to jump through- they are after all a bank.

This is the general path banks take, but in practice many banks do this differently, a few are efficient and many are not.  Larger banks usually take longer. If there is PMI on the loan, decisions take longer. If there is more than one note, it is even more complicated. Each note holder has different and often opposing interests and this complicates a short sale enormously.

Buyers should not expect an answer to their offer for 30-45- days, if there is more than one note, or PMI,  times 2,  and closings are at least 60-75 days away, and frequently120 or more.

Why Are Agents Reluctant to Pursue a Short Sale?

Simple- they are on unfamiliar territory.  They have heard horror stories (I have too) they have been frustrated in the past,(I have too) they may have submitted an offer to the black hole that is Bank of America- enough to frustrate anyone.  Basically they are afraid of the unknown, and want the easier typical re-sale. But ifyou are Buyer, theat “easier” doesn’t help you.  If a Buyer doesn’t have to move right away, they need to be considering short sales, that’s where great deals happen.

What Steps Should I take if I am Interested in buying or selling in a Short Sale?

First things first, find a broker experienced in Short sales.Experience in short sales and strategies to both buy and sell  are still very new. On the Sale side, what is the banks position on home pricing? Will the Sellers liabilities  be discharged in full, or not? Are the Sellers committed to move- Sellers can’t simultaneously pursue a mortgage modification or adjustment.

We currently are  helping several home sellers find a short sale buyer. Buyers won’t be able to have repairs done, so look it over well or have it inspected before making that offer.   Consider a 3rd party warranty company if the home is older. Do make that inspection- Sellers won’t do repairs but you may still be able to walk away, or know whats going on in the house.  Most of all be patient… banks are non-emotional and will say yes or no, but they have a lot on their plate.

As you might have guessed, I’ve just scratched the surface of this subject. In the last year we’ve seen an increasing number – even in our more healthy real estate  market.  If you bought a home in 2006 or 2007, without a big down payment, and now have to sell, and don’t have the cash to cover the loss, you are most likely in a short sale situation.  We can help.

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The McDonald Group is a full service brokerage partnership that offers hi-quality Buyer and Seller Representation to home buyers and sellers throughout the greater Charlotte area. Call Terry direct at 704-351-1519 to get  started.

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Good News In Charlotte Real Estate – Case-Shiller Charlotte 2009

I’ve written about Case-Shiller (CS) before, but if you are reading for the first time, if you are interested in housing prices, Charlotte home prices, you need to get to know Case-Shiller. CS is the leading housing economic index and a warehouse of data of home prices in 20 major cities across the US and is considered the most accurate measure of house values in the country. Policy-makers use CS to make housing and lending policy in the US and abroad.

Charlotte home prices fell 3.8% in 2009, and that puts Charlotte right in the center of the 20 city index.

This compares favorably to a 2008 drop of (Charlotte) 7%, which was favorable in light of the 20 city average of 20% fall in prices in 2008.

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There have been recent local headlines that site this as bad news, along with the very low number of new housing starts in January new construction- I just don’t see it that way. Inventories are coming down nationwide- and Charlotte wide. Starts are down because there is still a great deal of inventory, and without contracts (remember December sales were slow-as they always are) builders are not building inventory in most parts of the country.

And now we learn that January home resales were 5.8% ahead of 2009. That is good news.

Home prices are stabilizing, with fewer and fewer cities experiencing double digit home value losses, many cities experiencing their first gains. This outstanding chart was sent to us by a local builder.

People are buying and selling homes in Charlotte. We’ve put three homes under contract in the last 10 days, and they are all out of town folk moving to Charlotte by choice, looking to increase their standard of living. The life-style relocations are back!

Long term growth in Charlotte, like the rest of the country, is dependent on jobs- lowering the unemployment rate through GDP growth.

You’ll see there is good news on this front as well.

past 24 months of job losses

past 24 months of job losses

Here there is some good news as we see the rate of job loss diminishing- now we need to start them growing, and jobs grow when the economy grows- Good news here too, and after 2 consecutive quarters of sturdy GDP growth. Lets look at a graph here:

Strong GDP growth 2nd half 2009

Strong GDP growth 2nd half 2009

When you look at 4th quarter 2008, and 1st quarter 2009, you can see how ugly this economy was… that’s why a 3.7% price fall is welcome news in Charlotte- because by all accounts it could have been much much worse.

Averaging 4% growth in the 2nd half of 2010, along with Wednesday’s announcement by Federal reserve Chair Bernanke that interest rates will remain very low for the foreseeable future- we are poised for a recovery.

That will be good for Charlotte home prices! Bad for interest rates, so by low, buy now.

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The Reserve Waxhaw NC

February 3, 2010

Waxhaw Real Estate

A Real Estate Market Report: The Reserve- Homes Sold, Homes for Sale
The Reserve is a popular Waxhaw community at the corner of New Town Road and Crane, just a few minutes to Rea Road to take you to Ballantyne, Uptown, or to the airport. Schools are the well regarded Sandy Ridge Elementary, and [...]

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