Buying a Short Sale Property in Hernando County Florida, 12 Steps You Must Know

As banks foreclose on hundreds of homes in the area of Spring Hill and Brooksville Florida, buyers will find some amazing garage-sale priced homes; but buyers have opportunities to buy homes through a "short sale" before a home goes into foreclosure.

What is a "short sale?" A short sales may be defined as the sale of a foreclosed home at a price less than the existing mortgage balance; however the ultimate price of a short sale lies in the willingness of the bank to negotiate terms. This is a complicated process and,up until now, has rarely occurred. Short sales will without a doubt be prevalent for several years to come.

It is good advice to consider hiring professional help when you are looking to buy a home. There are so many legal loop holes that the average person could be taken advantage of. Realize that the majority of lawyers and real estate agents have little experience in these sales. In order to be successful, you need to be very careful in who you select to be your helper. The most important point to consider is: Going it alone when purchasing homes in foreclosure will significantly increase your chance of failure at the bank.

I will not build a short sale listing by myself because it at times means that I would be practicing law. I use an attorney who is a foreclosure defense attorney and one who understands short sales inside and out.  He actually worked as an attorney within mortgage companies going after homeowners who defaulted on loans and chased them for deficiency judgments, so he is very competent.

The steps in the process are:

1. Locate homes which are in default, as early as possible, even possibly before the formal non-judicial foreclosure begins.

2. Search foreclosed homes with plenty of lead time before the Trustee's Sale (you may need weeks or months of lead time.)

3. Once you have created short list of such homes, narrow that list to only those homes you would likely purchase for yourself.

4. Complete an accurate Comparative Market Analysis (CMA) using sold homes with similar features, via a good database such as the local MLS.

5. Determine the exact mortgage balance and status of default or foreclosure.

6. Be sure to find out if there is a second or third mortgage on the house.

7. Research the possibility of other liens (tax liens, mechanic's liens, labor liens, state liens, etc.)

8. Determine how best to talk and negotiate with the loss mitigation department of the bank or mortgage holder (email, fax, phone, etc)

9. Determine whether or not purchasing via the short sale will negate any subordinate loans or liens (another trap for the unwary.)

10. Know which costs and fees in addition to the mortgage balance can be compromised and by how much (experience is the best teacher.)

11. Prepare a comprehensive package to present to the mortgage holder, which is the most critical step in closing a short sale. This should include the Purchase & Sale Agreement, and a thorough analysis of the home, prices, the local market, and justification of your offering price. Your offer must be prepared very professionally or the bank will merely overlook you, without giving your offer a second look. You have to be able to make a case to the bank, as to why they should sell to you at this price.

12. In order to close on a deal in a short sale, you must follow through with all parties involved.

The complexity and difficulty of closing short sales should never be underestimated, even under the best of circumstances. It is hard to find a buyer of foreclosure properties through the short sale process, despite what con artists would like you to believe. You should have some experience before purchasing foreclosure properties. The reckless need to be aware of entrapment.

Buying a foreclosure may be a fast way to lose money if in the process you make major mistakes. On the other hand, because the purchase price is below the current market value of the home, it can be a great way to pick up equity immediately the day of closing. Many people have also come to a dead end with this process after months of frustration.

If you are thinking of doing this, contact me or one of our agents who specialize in short sales.

Hello everyone and please pardon my recent absence. I've been very busy taking care of out of state buyers wanting homes in Hernando County. Over the past six months I have come to the realization that unless a short sale is being mitigated, or watched over by an attorney specializing in real estate law and short sales the process of selling or obtaining a short sale home is rather lengthy.

So lengthy in fact, that the house many times will not appraise to the selling price if it is going to be financed by the new buyer.

You need an attorney that specializes and is experienced in handling short sales. These attorneys have phone numbers inside the lender's offices that we as Realtors, buyers and sellers do not have. Additionally, a good real estate attorney knows the minefields of a short sale and can prevent a deal from falling apart by working with the legal team of the lender.

I keep on tap two attorneys for these matters and am looking for a third. These attorneys are just as important and integral to my success as is a good mortgage company, title company or home inspector.

When I get a call from a homeowner who is in trouble, I will gladly take the listing, BUT, only if they will put an attorney on retainer. Generally speaking the cost to hire an attorney is about one month's mortgage payment, and the attorney is well worth the expenditure.

For now that's it from Spring Hill Florida, where the weather is sunny tropical and the home buys are by far the best in the USA.

This is Jaz Zydenbos from Tropic Shores Realty Spring Hill Florida saying Happy Trails to you until we meet again.

Take a look around. It's as though we are living in totally different times than just a few months ago. Gas prices rose to well over $4.00/gallon and have since receded to between $2.00 and $3.00 in most places. We have witnessed the election of our first black President of the United States. Unemployment and job loss is at record levels. Here in Hernando County Florida the worst in our county's history. And more and more local families in Brooksville and Spring Hill areas of Florida are losing their homes to some sort of distressed property sale or foreclosure.

I was listening to local am radio WWJB with talk show host Bob Haa on Friday morning who was discussing the rising rate of unemployment and job loss which is tops in all of Florida. While the news was not good, what struck me about the report was an interview with a gentleman who had been a professional of some sort and lost his job over a year ago. His severance has run out, as have his unemployment benefits. When asked what is on the horizon for him, he responded… “Well since we haven’t paid our mortgage in so many months, I guess losing the house will be next.”

I have realized that we really are living in different times. There is no shame in losing one's home. Some almost speak of it as being chic. Just a few years ago people still saw a stigma in speaking publicly about the prospect of losing or having lost their home. Socially, when the numbers of people experiencing something grows rapidly and suddenly, fewer people feel the need to conceal their situation. The increasing casualness with which people speak of being foreclosed on should be alarming to all of us… it means that the stigma has been removed because, for so many Floridians along the Nature Coast, their inability to pay their mortgages has been deemed “out of their control”.

Please don’t misinterpret my point… I do realize that the factors leading up to many foreclosures these days are beyond any individual’s control. As a Short Sale and Foreclosure Specialist, I have tremendous compassion for homeowners facing foreclosure and have heard clients share heartbreaking stories that have nearly moved me to tears. But I am concerned with the disappearance of the stigma of foreclosure.

I hope I am wrong, but typically, when the stigma attached to anything negative or bad is removed, it is slow to return, if it ever really does. Why is this bad? Well, now that Foreclosure or homeowners simply “walking” on their mortgage has little, if any, stigma attached, I fear that even once the economy rebounds that people will now view those options as an “easy way out” when money gets tight. They can just blend in with the folks who lost their homes due to factors beyond their control, avoid the stigma that was once associated with foreclosure and we, as taxpayers (and therefore, bank owners) will all pay the cost. For a full foreclosure list and some of the best buys in all of Florida, be sure to look me up or any of our talented agents at Tropic Shores Realty, Hernando County’s market share leader.

Let me hear from you. How do you feel?

There is a difference between bluffing (lying) and negotiating.

I was thrilled last month to have sold a listing of mine in after a price drop, with two offers on the same day. While some economists say we are at the end of economic depression in Hernando County Florida, this is very encouraging. When enough buyers hear that things are good or getting better, they start buying homes, which makes it rachet up in our local economy of Spring Hill and greater Brooksville.

During the bids on this listing of mind, it occurred to me about something that has happened to me a couple of times over the four years I have been selling properties for Tropic Shores Realty in Spring Hill. When I receive multiple offers on my listings, I get the sense that at least one of the agents thinks I might be bluffing especially if I do not know them for them being new or from out of Hernando County. Inevitably, these are the agents whose clients do not "win" the house.

It doesn't really seem to matter if I tell mention over the phone something like this:

"Obviously, my client wants to get the best price possible for their home, but I really do have another offer."

I suppose most of us have been conditioned to be skeptical of multiple offers, or bidding wars, especially since the newspapers and cable news has talked so much about how tough it is to sell houses. However, when a property is priced correctly and in great shape, it WILL sell fast, at least here on the Nature Coast of Florida.

Many times, I have had buyer's agents simply stand their ground, as if that will help their clients. Unfortunately, that just removes them from active negotiations, basically giving up the property to someone else. The old adage applies, that you cannot work with unreasonable agents or customers.

If you as a customer or buyer' agent decide that you would prefer to fake or lie during negotiations, don't make it so darn obvious.

I once had an agent tell me that she was expecting a full-price offer in the morning, but that her clients were willing to take my offer if we would increase it by $5,000 (still not full price). That's funny, I don't care who you are!

I told my clients to wait, and the sellers accepted our offer with no changes. This was such a blatant and obvious lie that it was easy to see through the agent's thin story.

I have always believed that it is my job to get the best possible price for my clients, both buyers and sellers but in the last analysis, the market if prompted well will decide the price the buyer is willing to pay, and the price the seller is willing to sell.

So, don't lie, don't bluff! You'll lose every time.

If you are attempting to sell your home in Hernando County Florida you knew very well what you were getting into when you decided to put your home on the market.

But did you know that the density of foreclosures to population that Hernando County ranks to the very top in Florida? Certainly you are aware about the glut of foreclosures and declining values affects the sale time and amount you will receive for your home.

There are two prices to indicate whether or not you home is going to sell. The first price is the agent "phone ringing price." If your listing agent's phone isn't ringing on your home within the first three days of listing it, chances are it is priced too high. And if I may, chances you the seller picked the price and not your listing agent. Even though I am a professional agent, like you I have an emotional attachment to my home and my equity in that home. That is why when I buy and sell homes, I never do it myself and rely upon the expertise of another professional agent to determine market price.

You are either on the market price, slightly ahead of the market price, or behind the market price. If you are behind, and attempt to chase the market, you are losing money every single day. Again, unless your price is causing the phone to ring, reconsider your price, listen to your agent, but better listen to the market, because this vast invisible force will tell you or not whether it is interested in your home. Does that make sense?

Foreclosures have been making up about a third of all sales in the Hernando County market, and the median sales price for a bank-owned home in May was $103,000 down from $147,000 just one year ago.

If you would like a free consultation on how to sell your home in this market in 30 days or less, please call upon me at Tropic Shores today. 352-263-6385. Or on the web at http://TheBestHomeBuysInFlorida.com

This is Jaz Zydenbos saying Happy Trails to you until we meet again.

A still-hefty supply of foreclosed properties in Hernando, Pasco, Citrus, Hillsboro, and Pinellas Counties of Florida are keeping prices at rock bottom, and experts believe that will not change until at least the middle of 2010.

Realtors and other market pundits point to the steady rise in transactions as indicative that the existing home sales market has hit bottom. I agree that the worst of the fall in values appears to be bottom but be careful that mortgage interest rates are increasing and while  job losses will be at rates that could approach the great depression of the 1930's.

Prices are definitely moving buyers off of the sidelines. If you took away the low price tags, you'd likely see sales volumes fall again.

Driving sales are investors paying cash and first-time buyers getting government incentives and Federal Housing Administration loans, which require minimum 3.5 percent down payments.

If you have cash, you're royalty in this market. You are buying something in five or 10 years from now that will look like a real bargain.

This is Jaz Zydenbos saying Happy Trails to you until we meet again.

The interstate highway system I-75 came close by 30 miles, but not close enough, and the runway at the Hernando County airport isn't commercialized other than charter freight jets. But now with the Sun Coast Parkway is just eight miles away and in the near future Hernando County airport is poised to host regional carriers, which means more tourists - and a lot more deep pocketed buyers.

Hernando Beach and Spring Hill is an economy waiting to bust open. Other factors increasing housing demand: Property prices are still low and falling by tropical coastal standards, and the local market is still seeing a high rate of foreclosures.

I see properties that were $500,000 just 18 months ago now selling for $260,000. But wait, when the economy improves, it would be very easy to see a quadrupling of prices on beautiful waterfront homes in Hernando Beach. There are very few vacant lots available.

If you would like more information regarding the best home buys in Florida, contact me at Tropic Shores, where business is hot, hot, hot!  352-263-6385.

This is Jaz Zydenbos saying happy trails to you until we meet again.

A recent common complaint of my fellow Realtors in Hernando, Pasco, Pinellas, Sarasota, Orange and Citrus Counties of Florida is that "lowball" appraisals far below contract prices are killing many contracts.

Although pre-owned home sales rose slightly in May - posting the first back-to-back month of increases since the fall of 2005 - the 2.4 percent increase was less than expected from a previous rise in pending sales.

Many contracts failed to close in May because of poor appraisals kept buyers from getting a mortgage.

Local rumors of appraisal irregularities have been swirling from all across the county. Some mortgage lenders are employing appraisers who are not familiar with our very diverse neighborhoods of Spring Hill and Brooksville Florida for example, or who compare traditional homes with short sales and foreclosures.

Sales of new homes were virtually non-existent in May, and one of the reasons limiting sales of new homes was the use of foreclosures and short sales as a comparable and the affect on appraisals of nearby existing homes.

Because many appraisers cannot see the interiors of homes that are used as comparables, appraisers may not be aware of major deferred maintenance issues or damage that are rampant with foreclosed properties. The failure of appraisers to adjust comparable values of bank owned and short sales often results in the undervaluation of new homes.

This is Jaz Zydenbos saying Happy Trails to you until we meet again.