Spokane Home Search

Search All Spokane Homes Online…

Social Media:

Archive for May, 2011

So what is a Short Sale

Overview of what a Short Sale is

So what is a short sale? A short sale is a term used to describe when more debt is owed on a property than what the property is actually worth. The owner can’t sell the property unless the holder of the mortgage agrees to accept a payment that is short of the amount that the owner owes.

Conducting a short sale is really like a pre-foreclosure. You are just securing a buyer prior to your sale date.

Short sale is conducted like a regular real estate transaction. It is once you receive an offer that the short sale process actually begins and it is up to your default specialist to bring in a purchaser.

There are a number of forms that need to be processed for the short sale to take place. These are referred to as short sale documents and are sent to the bank.

These include:

  • Authorization Letter
  • Payoff Request
  • Bank Statements
  • Do Not Call Form
  • Last two federal tax returns
  • Last two pay stubs
  • Buyer Loan Approval
  • Estimated HUD
  • Real Estate Purchase Contract
  • Exclusive Listing Agreement
  • Financial Worksheet
  • Hardship Letter

For a smooth transaction, once you have a purchase contract for your property, these documents are required to move forward on your short sale.

  • Your home is generally shown to both traditional buyers and investors.
  • The goal is to get the highest offer in the shortest amount of time.
  • All offers are signed and submitted to the lender for review.
  • When the lender accepts an offer, that particular offer needs to be signed by you for escrow to be opened.
  • Once the offer(s) is sent to the lender(s) the short sale process can take anywhere from four weeks to four months and varies with each lender.
  • Once the lender reviews the short sale package, they will order a BPO (Broker Price Opinion) which is similar to an appraisal.
  • Once the lender receives their report they usually make their decision shortly thereafter.

Your property remains on MLS until the lender accepts the offer. As this is not a regular transaction it can take longer to complete so you’ll need to be patient.

Once the offer is accepted by the lender, escrow can be closed anywhere from 10 – 30 days.

You as the seller do not need to attend the closing. In most cases you could grant your lawyer power of attorney and he/she will act for you at the closing table.

After your short sale is completed your mortgage payments are extinguished and it’s time to start working on restoring your credit again.

Try not to incur any new debt and keep balances low on credit cards.

Do not pay late on any accounts and if you rent, pay by check so it can be tracked to show you are paying on time. Many people will rent for a short time to give themselves a breather and until their credit is repaired.

When it’s time to get back into another house, working with the right people is essential.

You will be in another house in no time!


No Comments »

Diamond in the Rough

Diamond in the Rough


So what is a Diamond in the Rough? Something that has hidden exceptional characteristics and/or future potential, but currently lacks the final touches that would make them (or it) truly stand out from the crowd.

A House’s first  impressions is everything (or is it?) and it’s difficult when you see a home for the first time not to make an immediate judgment. Many people are turned off by what they first see, smell, and hear. But, there are many homes out there worth taking a closer look at (do you have a vision that could turn a piece of coal into a diamond). Some call it “good bones”. Often a home has been neglected for reasons such as; someone has passed on or taken ill, the home has been rented out or sometimes it’s just because people really don’t have the time, resources or they have more pressing priorities.

It’s difficult to walk into a house that looks like a disaster and see beyond the clutter, dirt and bad or outdated decorating choices. But, there are many homes that with some clean up and minor renovations can be quite functional and appealing. If you can see beyond all of the undesirable surface problems you may get a break on something that most people would turn a blind eye to and walk the other way.

If you’re considering a home like this, first you need to find out if the home is structurally sound. Are there any major problems like roof, electrical, plumbing, windows, leaky basements, kitchen or bathroom repairs or renovations that need to be done?

Often adding a bathroom or a garage or turning a smaller bedroom into an office can give you the home you ultimately want. If a home is on a particular lot or piece of property you love but the house is not quite up to snuff, then it may be worth doing the repairs or renovations to give you the complete package.

Bringing someone with you who has sound knowledge of these types of things and what it will take from a labor, materials and cost perspective to bring the home up to your standards is a good idea.  A person who is experienced with home renovations or a home inspector or appraiser is a good choice.

Once you’ve determined what needs to be repaired or replaced, you will need to decide two additional items; do you have the monetary resources to complete the projects in the time frame you are looking for and if you can or want to take on any of the tasks on yourself or will you need to hire someone else to do it.

Can you and/or your family live in the home while the renovations are being done or will you need to live elsewhere?

If you can’t afford to repair or replace everything now, what can you live with until you are able to make it happen?

Maybe you are considering this home for investment purposes. You must determine if the money you will put into this home you will get a return on once the improvements have been made. Some things to consider are:

  • Are the changes to the home cosmetic in nature?
  • Does it just need a good clean up and some fresh paint?
  • Does flooring need to be replaced and what is the cost to do that?
  • Are the windows and roof in good condition and when will they need replacing?
  • Is the heating system in good working order?
  • If it is a country property are the well and septic system in good working order and when were they put in?
  • Electrical and plumbing should be looked at to ensure they are up to current standards.
  • Is the home insulated properly?

  • Is the exterior of the home in good condition?

    If you are considering a home like this, next you must ensure that it is in a good community or neighborhood. You can put a lot of sweat and money into a home only to find out later that it won’t sell or you’re not happy there because it’s in an undesirable neighborhood or community. It’s never a good deal if you hate living there or can’t sell it.

    Many times if you broaden your search criteria and you become open to looking at homes that you never would have thought to look at in the past, you may find your diamond in the rough.

    No Comments »