Posted in Real Estate Tagged: Miami real estate, Mortgage Modification, Stop foreclosure

Foreclosure Bank Owned brick front vinyl siding two story home.This 3 bed 2 bath offers an open floor plan this home features include: 10ft ceilings, ceiling fans, electric fireplace, mini-blinds,granite countertops, ceramic tile, 2 car garage with electric garage door – plus many other features. No Assessment fees or new buyer fees. “This property is approved for HomePath Mortgage and HomePath Renovation Mortgage. Please contact listing agent for more information.”

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Tagged: bank owned, bank owned property, florida foreclosure, florida foreclosures, foreclosure, foreclosure properties, foreclosure property, foreclosures, reo, reo properties

Myth #1: The bank can’t foreclose on my house because I have homestead.

Truth:  Florida homestead law only prevents unsecured creditors (those with uncollateralized debt, such as credit cards or student loans) from foreclosing on your home.  When a homeowner uses his/her home as collateral for a loan, the lender can foreclose on the property if the loan is not paid back as agreed. With a mortgage or home improvement loan, the property itself is used as collateral for the debt, which serves as a kind of security blanket for the lender. This is why credit card limits are low, relative to mortgage amounts.

Myth #2: I have to do everything I can to save the house – it’s all I have!!

 Truth:  This is the first time in history we have seen this many homes going down in value. Americans are used to picturing their home as an investment, not as a place to live.  They see home ownership as a right, and are sometimes irrationally attached to keeping the home. That’s why most are reluctant to part with it, even when it makes no sense to continue owning it. If you owe $200,000 and your house is only worth $100,000, that’s called negative equity. You don’t “have” anything. In order for your house to be considered an asset, it has to be worth more than you owe.  If you own a car that is paid for – even if it’s only worth $500 – that car may be worth more than your house!  It will take years for the percentage of homes with negative equity to start decreasing, and it will take longer still for homes to reach values seen during the market peak of 2005/06.

Myth #3:  All I have to do is file bankruptcy, and the mortgage company can’t take my house.

Truth:  Bankruptcy is not a protection from foreclosure. At best, in some cases, it may temporarily delay foreclosure proceedings. But even if you qualify for Chapter 13 bankruptcy (not everyone does), you have to make your mortgage payments. If you don’t, the mortgage company can foreclose. Bankruptcy judges may be able to modify the terms (interest rate on credit cards) or reduce the amount owed on other bills, but not on your mortgage. If you can’t pay, you don’t stay.

 Myth #4:   Foreclosure costs the bank lots of money. They’ll come to their senses and let me pay whatever I want and won’t foreclose as long as they are getting some money.

Truth:    Almost every day, there are stories in the media about banks being in bad financial shape because of customers defaulting on mortgages. They’re in such bad shape that the government has to bail them out!!  So, doesn’t it make sense for the bank to modify loans and make mortgage payments affordable? Something is better than nothing, right?  We look to banks as institutions with integrity, but even if a bank acts without integrity, we think we can count on the bank acting in its own best interest, financially speaking.  It will cost the bank way more money to foreclose than to let the owner stay there and pay what s/he can every month – so why are they shooting themselves in the foot by not doing that?  It has been speculated that some loan servicers have a financial disincentive to modify loans because they receive additional fees from investors/lenders for managing delinquent mortgages. 

If the bank forecloses on your house and kicks you out, they own the house and can choose to sell it…or not sell it. Selling the house brings the bank a larger amount of cash in a shorter period of time than reduced mortgage payments.  But let’s say the bank forecloses on your house, and lets it sit empty for a year.  They may have lost 12 months of revenue, but the house is now recorded on the bank’s books as an asset. The more assets a bank has, the more money it is allowed to lend and; the more loans a bank makes, the more money the bank receives. In either case, the bank can try to collect from you at the same time.

Myth #5: When the bank forecloses on my house, they can never bother me again.

 Truth:  Foreclosure can follow you forever. Florida is a recourse state, which means that, if the bank forecloses and then sells your house, you will still owe them the amount of the “deficiency”, meaning the difference between what they got and what you owe (includes late charges & legal fees). They can still get interest on that, too! What’s worse is that they aren’t required to take immediate action after foreclosure; lenders can wait up to five years to collect on the debt. They know you’re broke now, but they assume you won’t stay that way.  Down the road, your wages can be garnished and/or liens placed on other property(s) you may have acquired. 

 Also, having a foreclosure on your record means that, anytime you apply for a mortgage in the future, you will have to answer yes to the question, “Have you ever lost a home to foreclosure?” Recent Fannie Mae guidelines say that you may apply for a mortgage seven years after your foreclosure or after bankruptcy has been discharged. However, you must have a credit score of 620, and a minimum 20% down, and only if purchasing a primary residence (not a 2^nd home, cash-out refinance, or investment property).

Myth #6:  My neighbor hasn’t made a mortgage payment in over a year & they haven’t foreclosed on his house — I have plenty of time.

Truth:  Even if you and your neighbor send your mortgage payments to the same company (e.g., Countrywide, Wells Fargo, Litton), that doesn’t mean your houses are financed by the same company.  Most mortgage owners use mortgage servicing companies to handle their payment processing & collections. The true decision maker regarding foreclosure is the investor(s) that owns your mortgage. And your mortgage’s investor may have a more aggressive foreclosure policy than your neighbor’s.  The longer you delay, the fewer foreclosure alternatives will be available to you.

Myth #7:  The homeowner’s association can’t foreclose on my home.

 Truth:   Not true! Homeowner’s and condo associations can foreclose because they have a legal interest that is secured by the property. Since the real estate bubble burst and the economy flattened, the number of homeowners behind on their association dues has skyrocketed. As a result, associations have gotten more aggressive in their collection efforts. Some go all the way and exercise their right to foreclose on the property. When that happens, the association evicts the owner (former owner), and rents the property out in order to pay for current and past due fees.

Myth #8: When a judge hears my sad tale they will not kick me out.

Truth: Foreclosure hearings last less than 30 seconds. If you go to court for the hearing and ask to speak to the judge, the judge will ask if you are behind on your mortgage payments.  All the judge wants is a Yes or No, not a Yes, but… The judge has no interest in your explanation; s/he is merely acknowledging the amount owed to the bank and that the legal contract between you and your lender has been broken due to non-payment. If you don’t pay, you can’t stay.

Myth #9: The bank messed up one of my payments and I have proof! They can’t kick me out, in fact, I want to sue them and I’m going to collect big!

Truth:  People often focus on the wrong things, waste time and lose the main objective while focusing on the trivial details. If you owe the bank $10,000 and they say you owe them $10,500, even if you are right, a $500 error will not mean anything in terms of a judge stopping the foreclosure or awarding significant money to you. Concentrate on stopping the foreclosure by dealing with the $10,000 you admit you owe and deal with the $500 error as a secondary subject.

Myth #10: This is not my primary residence, so foreclosure is my only option.

Truth:  Not true! Foreclosure is expensive for the lender, regardless of the type of home owner. Mortgage companies can allow investors to do short sales or, in some cases, loan modifications.

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Pre-foreclosure Period A foreclosure in Florida begins when a lender files court action and records a notice of a pending lawsuit (Lis Pendens) against the borrower. The lender notifies the borrower and any other affected parties in person or in some cases by mail or publication. If the borrower does not respond to the court action within a specified amount of time, the county clerk can find the borrower in default and the lender can ask the court to make a final ruling. If the court rules against the borrower, the ruling will include the total amount owed to the lender and the foreclosure sale date. The lender is not required by state law to notify the borrower before initiating the foreclosure process, but individual mortgages or deeds of trust might call for this. The borrower can stop the foreclosure up until the date of the sale by paying the total amount owed to the lender. Notice of Sale / Auction The sale date is typically 20-35 days after the court ruling, but this may vary depending on the individual court. The clerk of court issues a notice of sale containing the location, date, and time of the sale. The notice is published once a week for two weeks, with the second notice appearing at least five days before the sale. The clerk usually oversees the sale, which ordinarily occurs at the county courthouse at 11:00 a.m. on the sale date. The winning bidder must provide a 5-percent deposit and pay the remaining balance by the end of the day or a new sale is scheduled a minimum of 20 days later. After a successful sale, the clerk gives a certificate of sale to the winning bidder Within 10 days of the sale, the clerk transfers ownership to the winning bidder if no one disputes the sale. In most instances, a borrower has no right of redemption after the certificate of sale is issued.

If you’re at risk of having your home foreclosed on, you should contact us foreclosure help. You might still be able to stop foreclosure.

Florida continues to have one of the highest rates of foreclosures in the nation.  California and Nevada round out the top three and foreclosures were reported as increasing 32 percent from last year.

This means that more bank repos are on the way and depreciation of Florida real estate values will continue. 

The bottom is still a long way off, and investors should be patient, consider cashflow and ask “what if this property depreciates 3% per year for the next ten years?”

This statement is worth noting “In Florida, one in every 135 households received a filing in April.”  see full article here

RealtyTrac: April foreclosures rise 32 percent – Yahoo! Finance

LEE COUNTY: our stats report shows 1 out of every 65 homes in the Fort Myers/ Cape Coral area received a foreclosure notice in February. At the same time, Lee County’s foreclosure filings are decreasing.

The truth is in the numbers.

New numbers show Lee County had only 1960 new foreclosure filings in February. That’s compared to more than 2,000 in January and more than 2,200 in December.

What this means to buyers looking for their style home at a real good price is;
Selections will be diminished thus causing prices to escalate. I am seeing price increases in many foreclosed homes due to a very high demand.

Recently an asking price of 87,000 for a newish pool home in Cape Coral Florida had 45 offers and sold for 130,000.
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First time home buyers or buyers that have not owed a home for 3 years now have an 8,000 dollar incentive courtesy of the Stimulus plan. “Does not have to be paid back.”

If you should want more information from us as Exclusive Buyers Agents.
Our Web site; www.sunnyspotrealty.net .
email Jb@sunnyspotrealty.net
Call (239) 770-0686

Joseph Beauvais

Foreclosures Cape Coral Fl Real Estate