“Short Sales” are becoming a popular alternative in helping Homeowners avoid the traditional foreclosure.  It is considered as an alternative when the mortgage is much higher than the property is worth or when the Homeowner is unable or unwilling to continue making their mortgage payments.  However, be prepared to exercise a lot of patients, stay calm ,”breath in,  count to 10 and then slowly exhale”. Last but not least be very persistent because this is absolutely not a quick process.

The Lender’s Loss Mitigation Department is the department focusing on making determinations as to weather the Lender will suffer the foreclosure loss or to restructure the loan allowing the Homeowner to keep their home. The Collection and Customer Service Departments are only interested in collecting any and all past due loan payments.  Go directly to the Loss Mitigation Department.  Be prepared to work with this department anywhere from two weeks to sixty days.  Try and develop a nice and professional  relationship with the Loss Mitigation Negotiator. 

• Step One - What is the Financial Situation
  The Lender will evaluate the Homeowner’s financial situation by reviewing current income, bank statements, tax returns, etc.  Any and every money source available to the Homeowner must be provided to the Lender.  At this point, it would be advantages to write a Hardship Letter to the Lender explaining the circumstances and life changing events that brought you here to be in this position and unable to meet the mortgage obligation.  
• Step Two -What is the Value of the Property 
  The Lender will appraise the property to get the current value of the property.  The Lender has a formula for what percent under market value they will and will not accept.  As well as, to determine if there is enough money to satisfy the sale from the current property value.  The Appraiser will be selected by the Lender, but the cost of the appraisal will be paid by the Homeowner either at closing or sometimes the Lender will require payment be made directly to the Appraiser at the time services are rendered.
• Step Three - What is the Comparison Cost
  The Lender will determine how cost effective it would be to “Short Sale” the property in comparison to conducting an actual foreclosure with all of its process.  A foreclosure can be very timely and not so cost efficient for Lenders, not to mention they become proud property owners and the burden of re-selling the property falls on their shoulders.  In today’s economic situation this alone (selling property) can be a very cumbersome task.  The Lender’s decisions is really a question of economics.
• Step Four- What Is the Lender Willing to Accept (Negotiate)
  The Lender will strategically negotiate all offers presented to them.  If the Lender agrees to accept the offer presented and agrees to reduce their payoff in lieu of the standard foreclosure, you are on your way and the “Short Sale” process will proceed.  Once the Lender accepts the terms of the offer an Authorization Letter will be provided from them outlining the agreement along with providing a date in which the transaction must be completed by.  Otherwise, all is null and voided if the terms including the date are not completed.  If the Lender does not accept the offer presented, they will most likely counter offer back with more suitable terms that better meet their expectations.  The incentive is there to reach an agreement, because remember the Lender has already researched what is best for them financially and they have decided the “Short Sale” road is worth exploring.  This is where you must remember, to be persistent, patient and calm - “Short Sale negotiations do not happen quickly”.  If you keep in-mind the Lender’s Negotiator is being inundated with other Homeowners trying to do the same thing that you are and there is only so many hours in a day.

A ”Short Sale” can be a good solution for the Homeowner, the Lender and certainly the a Buyer.  The Lender’s intentions is not to give away the property, but the Buyer is able to purchase a property at a good price in todays real estate market.  On the other hand there can be some negative implications (taxes and credit rating) handed down to the Homeowner after the sale because of the debt owed that was forgiven by the Lender.  The original Note obligated the Homeowner to pay the Lender in-full not a negotiated amount.  And sometimes a Lender will have the Homeowner sign a Note to repay what is still owed to them (difference between the Lender’s proceeds of the short and the original debt obligations).   If the Lender forgives all or part of the debt they can contact a credit-reporting agency with the negative information.  The IRS requires the Lender to submit Form 1099 showing the full or partial forgiven amount extended to the Homeowner.  However, the Homeowner will most likely meet the definition requirments of insolvency, which will protect the Homeowner from having to pay taxes on the Lender’s forgiven debt amount.  IMPORTANT:  Before you the Homeowner decide to explore the “Short Sale” alternative seek direction from your CPA or Attorney.  Know all your options, obstacles, money involved and any possible negative affects after closing.

The best option for the Homeowner that finds themselves in over their heads with their mortgage is speak to the Lender immediately, before the mortgage payments are too far behind.  In today’s economic situation a Lender will certainly work with the Homeowner either with a refinancing program, a extending the terms of the loan, placing the past due payments on the back of the Note, or some sort of loan modification option making the loan more manageable for the Homeowner.  Either one of these examples will give the Homeowner the opportunity to keep their home (if they are able to afford it) and the Lender the opportunity to keep the Homeowner’s mortgage, Win-Win for everyone.  There will be a financial evaluation conducted by the Lender before any decisions are made.  This, by no means is equal to the “Short Sale” evaluation process.  This one is quick and pain less.

Because of the loan trouble frenzy going on today a Title Company, AMERICAN TITLE on Augusta,must have the skills and knowledge to be able to work through the process of “short sales” and pre-foreclosure.  There are so many factors involved and such a date sensitive transaction it is imperative the Title Company, AMERICAN TITLE on Augusta, maintain involvment and have complete understanding of this specialized transaction.   AMERICAN TITLE on Augusta, is a sharp, experienced Title Company that provides exceptional title services…call us today and

“Discover the Difference”

American Title on Augusta
2400 Augusta Suite 300
Houston, Texas 77057

713-587-2025 (office) and 713-587-2026 (fax)

wreyna@titlehouston.com

Before you reach the Title Company of your choice, you would have: already selected your Real Estate Agent, found your home, signed a contract and applied for your new loan if your transaction is a purchase.  If your transaction is a refinance you would have began your loan application process.

Step 1   Choosing A Title Company When selecting a Title Company choose the one that can best serve you.  Simply having the right type of experience and knowledge is not enough in today’s highly competitive Title Insurance market.  To exceed the customer’s expectations a Title Company must have an executive staff who thoroughtly understands the industry, have the resources, is technology driven, is efficient, assures that each transaction is completed with the highest of professional and ethical standards and MEETS THE NEEDS OF THE CLIENT.

Step 2   Title Search and Examination A search of the Public Records is completed:

• to determine who the owner of the property is to reveal the legal description of the property
• to discover what liens are attached to the property
• to see if there are any restrictions as to the use of the property
• to learn if the property does or does not participate in a Home Owners Association
• to show that the taxes are paid current or if the taxes are delinquent

A report is produced the “Title Commitment”.  This report reflects what will be required of the Seller, Buyer, Lender and Title Company on or before the closing occurs.

Step 3   Closing Insturctions Once your loan is approved by the Lender, the Real Estate Agent and or Lender will notify the Title Company and:

• coordinate a closing date and time
• the Lender will provide closing instructions
• the Lender will provide closing documents

Step 4   Closing Day Prior to you arriving at the Title Company you would have approved the Settlement Statement.  The Settlement Statement reflects all fees agreed upon and all items needing to be collected.  The Escrow Officer will go over this document in closing as well to make sure you fully understand exactly what you are signing and there are no errors.  Also, the Real Estate Agent and Lender approve the Settlement Statement.

The closing:    a brief explanation, by the Escower Officer, of the documents that are required to be signed have all parties properly execute the closing documents review and ensure all the terms of the contract have been met (purchase) collect any monies due for closing costs disburse all proceeds according to the Settlement Statement the parties will exchange keys, information, etc. (purchase)

Step 5   After Closing Once the transaction is fully disbursed, the Lender’s documents are returned back to the Lender.  All the appropriate documents are recorded in the Public Records.  The Mortgagee Title Policy is issued to the Lender  and the Owners Title Policy is issued to the Borrower.

Call American Title “on Augusta” to discuss your individual title needs.  The Team at American Title “on Augusta” will meet all your expectations and is your personal title source.

“Discover The Difference”

Your real estate purchase is one of the largest single investments you may ever make, whether it is for a residential or commercial property.  So why risk such an important investment by purchasing a piece of real estate with unknown title defects?  A purchase without a TITLE INSURANCE POLICY could possibly result in a substantial loss. This loss could be catastrophic to your financial situation.  Purchasing a TITLE INSURANCE POLICY will protect you against such a loss up to the policy amount along with any incurred expenses due to the loss.

The tile (ownership) to real estate changes often through the years involving parties such as heirs, government agencies, lenders or contractors.  A title examination/research will provide you with the status of your real estate investment prior to your purchase.  Then why do you need a TITLE INSURANCE POLICY after the examination/research is complete?  Because even after the most detailed research some title flaws such as forgery, fraud, confusion, etc. can go undetected and come forth any time in the future.  By purchasing a TITLE INSURANCE POLICY your investment is protected.

Obtaining a TITLE INSURANCE POLICY  is a one-time nominal fee without any additional fees in the future.  The policy will provide protection to you or your heirs as long as you or your heirs own the real estate. 

It pays to be certain.  Know your ownership rights, property limitations and possible encumbrances that can attach to the real estate you are wanting to purchase.  Do not risk your real estate investment, there is no need, purchase a TITLE INSURANCE POLICY for complete protection and piece of mind.  Before you buy or sell you residential or commercial real estate, contact AMERICAN TITLE “on Augusta”.  The “Augusta Office” will offer you complete title services with a superior team working for you. 

Remember, real estate investments demand complete title protection.

“Discover The Difference”

American Title “on Augusta”

Kevin Price, Host of the Houston Business Show (M-F at 11 AM on CNN 650) announced that Wanda Reyna has joined the program as a Business Show Advisor. 

Wanda Star Reyna is an Escrow Officer/Branch Manager, Mother and Wife.  She gives each role her unparalleled personal attention with tremendous ethics and integrityWith all these roles and responsibilities Wanda is able to slip in an occasional date with her husband

Having been a Realtor and in the Title industry for more than twenty years, Wanda has excellent knowledge of the Houston market and Texas Title Insurance and how important it is that the client’s expectations and needs are met. She has proven to be a valued Escrow Officer in the Houston area. “Buying or Selling (residential or commercial) property is one of the largest investments most people make”, and having the opportunity to be a part of that, along with building relationships, is one of her motivations for being a part of the Title industry.She says it’s all about the professional, as well as the individualized service that keeps her client’s returning and referring. Wanda’s business is referral based

Wanda, along with her superior team, continues to concentrate on exceeding her client’s expectations. She holds a reputation filled with success, knowledge and trust Wanda’s motto is that of Ray Kroc (founder of McDonalds), “If you work just for the money, you’ll never make it, but if you love what you’re doing, and always put the customers first, Success will be yours.”