Another Short Sale Success Story

This homeowner no longer lived in the home and their plans to remodel and renovate didn't pan out as they had planned. Medical challenges and expenses derailed their plan and they needed help!

We were able to work with them and their lender before the foreclosure process even started to establish a price that the bank was willing to accept.  We listed the home as a pre-approved short sale and were able to get the bank to forgive their debt and approve the sale.

A short sale is very similar to a standard sale. The difference is the cooperation with the bank (lien holder) to establish a price that they will accept. This takes more time than a standard sale and financials from the homeowner. The bank will perform a financial analysis on the homeowner and they will also order a BPO (broker price opinion) to analyze their position as it compares to the value of the home.

Many short sales we see need substantial work in order to bring them up to safety and building codes. The bank may or may not want to take this on if they take the home back through foreclosure.  There is a lot that goes into the pre-listing portion of the short sales and we are here to help you navigate. 

Call us today if you are considering a short sale and need someone to talk with. 509-850-1900

Insolvency and What it Means

A big aspect of the short sale process is providing financials to the lender holding the note. They ask for these financials for several reasons and the biggest reason is to show insolvency. The bank doesn't want to foreclose if they can prevent it. Doing a cooperative short sale is a great way to avoid the foreclosure process and it keeps the bank from taking possession of the home.
spokane short sales

Owning homes is not what the mortgage guys are in business to do.  They take on property taxes, liability, and many other obligations that come with home ownership.  This is why many bank owned properties are liquidated at a discount and come with no warranty.

Back to the finances, proving insolvency is important for a homeowner to do while completing a short sale. The money that is coming in cannot be more than the money that goes out.  They are not out to steal your retirement and at the same time they do not want to relieve someone's debt if they can afford the payments.

Many times you will be asked to provide a financial worksheet that itemizes every dollar spent from groceries to utility payments. During this financial analysis if they determine that a seller is insolvent and cannot afford their debt it is a big first step in moving forward with a short sale.

Be prepared to provide bank statements, pay stubs, 2 years tax returns, and proof of payments when it relates to automobiles and other high dollar obligations. It is a burden to track all of this down and when you consider the amount of debt the bank is willing to relieve it is understandable that they perform this level of due diligence.

If you have questions about short sales, foreclosure, or anything else relating to this topic give us a call at 509-850-1900. We'd be happy to discuss your options.

North Spokane Short Sale | Avoid Foreclosure

This deal was brought to us by the homeowner who needed our help. She was upside down on it with the bank and unsure of her options. They were harassing her regularly about making her payments and when she contacted us, we were able to postpone the foreclosure sale.

Once we made contact with the bank and let them know we planned on listing the home for sale they began working with us to establish an acceptable price. We ended up selling this home for $100,000 and got the bank to approve the short sale and forgive the remaining debt owed by the homeowner.

There are many scenarios that lead someone to a distressed position as a homeowner. Several of these circumstances will qualify for a short sale, deed in lieu of foreclosure, or a restructured payment plan. We can help you explore these options and get out from under your mortgage.

The Spokane Short Sale Team

The Spokane Short Sale Team is Spokane's Premier Real Estate Group specializing in Short Sales. We offer a team of experts that work collectively to ensure you have the best opportunity to sell your home and get out from under your mortgage.

We have helped our clients get out from under millions of dollars in mortgage debt while saving them the headache of going through a foreclosure. Our team has experience working with lenders from all over the country and we will help navigate the paperwork and the process.

Short sales are a cooperative way for the home owner to work with the lender and sell their house for less than what they owe. This saves the lender time and money processing the foreclosure and it allows the homeowner a chance to rebuild their credit after the sale.

If you or someone you know is facing foreclosure or behind on mortgage payments call us today! We have tools in place to help.

Call Peter Hagen at 509-850-1900 or fill out a contact form and we will get in touch right away.

Short Sales Are Not So Short

After more than 1 year working on this short sale at 9601 E Upriver, we are finally closing and recording on it! We have gone through more than 5 buyers during that time frame and had to restart the Short Sale Process several times.

This is the perfect example of how a short sale can take an incredible amount of time from listing and pre-approval to final approval and closing.  Many short sales are originally listed at a price that is not yet confirmed by the bank. Most banks will not consider a short sale until the property has been listed for more than 7 days and a signed offer has been submitted.

This means that the process hasn't really even started yet and the buyer is in for a long wait. After the bank receives the offer they start a financial background check on the seller that includes a monthly financial statement, hardship letter, tax returns, bank statements, and investment summaries.

The long wait is typically due to missing paperwork and ongoing requests for more information if needed. A seller can certainly expedite this process by having all necessary financial information ready to go prior to listing the house.

The lender completes their financial check on the seller and then they perform a BPO and/or an appraisal on the house.  This is going to give them a current market valuation to factor into their final net.  The bank will determine a final net amount that they will accept and submit a counter offer based on those numbers.  If they original offer meets their criteria they may even accept it without a counter offer.

Most contracts determine this to be the beginning of the contingency periods where inspections and appraisals are ordered and performed by the buyer. The bank will set a deadline with conditional approval and when all the conditions are met both parties should be ready to close.

It is a long process and sometimes it does not work out in the favor of the seller.  Foreclosure is a very real possibility should the bank refuse the short sale.  Contact a local short sale professional if you need to sell your home and you owe more than what it is worth.

9601 E Upriver Drive | Bank Approved Short Sale | $159,900

We have a bank approved price for our Short Sale at 9601 E Upriver Drive at $159,900. 
Bank Approved Short Sale Spokane

This home sits on a large lot in the Millwood area with 4 bedrooms and 2 bathrooms. Hardwood floors on the main level with large living room.  Basement is finished and has wood burning fireplace.  Fenced backyard with detached shop and separate carport parking area.

Great home in an awesome neighborhood! 

Call 509-850-1900 today for a private showing!

Peter Hagen with RE/MAX of Spokane

Bank Approved Short Sale | 218 E Walton Spokane WA | $112,000

Come take a look at this Bank Approved Short Sale at 218 E Walton.  This home sits on a quiet street with huge park across the road.  
RV parking with detached garage and nice backyard.  

The inside has a lot of potential with hardwood floors, an unfinished loft area and lower level utility basement.  This home won't last long and will make a great investment property.               


Mortgage Debt Relief Act

When you sell your home for less than what you owe on your mortgage, the forgiven debt is considered taxable income.  That could surprise you with a large tax bill to pay. 

There is good news! The government has extended the Mortgage Debt Relief Act through 2016. This allows sellers facing foreclosure or working out a short sale to shield themselves from that large tax bill. 

The Mortgage Debt Relief Act was initiated in 2007 and has been extended several times and will apply to all properties under contract by end of 2016 set to close prior to the end of 2017. 

Selling your home in a short sale situation is stressful enough already. Take advantage of the mortgage debt relief act if you are facing foreclosure before it expires. 

Peter Hagen 509 850 1900 

Single Level Rancher in Airway Heights | Short Sale Subject to Bank Approval

The home on 12421 Meadow Ct. in Airway Heights is available now and subject to bank approval.

3 bedrooms 2 bathrooms and just under 1200 sqft with a fenced backyard.

Minutes to Fairchild Airforce Base and Northern Quest Casino.

Call Peter Hagen 509-850-1900 today for a private showing.

Bank Approved Short Sale in Airway Heights Coming Soon!

This home has been bank approved to sell at $184,900 and will be hitting the market this week! Don't wait for it to land online, call today for a private showing.  This is a single level rancher with 3 bedrooms 2 bathrooms and a large great room living area. 

Located just minutes to Fairchild Air Force Base, Northern Quest Casino and all of the other convenient amenities Airway Heights has to offer.

Peter Hagen - RE/MAX Of Spokane

SHORT SALE CLOSED | 1515 Beacon Lane

If you are looking to sell your home in a short sale situation call Peter Hagen with the Spokane Short Sale Team.  

1515 Beacon Lane

This home took an incredible effort to get closed. Thank you to everyone involved!  After being declined several times by Wells Fargo we were able to work with the homeowner and lender to come to a resolution.  The home was sold for less than what was owed and the homeowner was relieved of his obligation to pay off the balance.

When you owe more on your home than it is worth and you have to sell, you have options.  Call us for more information.

Spokane Short Sale Listing | 9601 E Upriver Drive

This home sits on 1/4 acre lot with a large backyard, detached garage, and ample off street parking.  4 bedrooms 2 bathrooms and a finished basement. This is a nice little home just outside of Millwood!

Offer subject to bank approval. Call listing agent for more information 509-850-1900

Peter Hagen | RE/MAX of Spokane

$115,000 3 Bed 2 Bath | Bank Approved Short Sale | North Spokane

Get in before it sells! 

This North Spokane rancher is bank approved and ready for a buyer. 3 bedrooms 2 bathroom with huge detached shop and fenced backyard! Minutes to the VA Hospital, Downriver Golf Course, and Audobon Park!

Asking Price $115,000 | Peter Hagen RE/MAX of Spokane

Mortgage Debt Relief Act

It looks like the Senate extended the Mortgage Debt Relief Act to cover 2014.

The Mortgage Debt Relief Act allows you to exclude income from the discharge of debt on your current residence. If you completed a short sale during the year 2014 you may be able to save money on your taxes by visiting this website.

Prior to the extension of the Relief Act, homeowners who were released from the deficiency had to pay income tax on the amount.  For some homeowners that is a heavy burden and a surprise when taxes are filed and refunds are expected.

If you are considering a short sale and would like more information on the tax implications contact your local tax person or real estate attorney.

Spokane Short Sale Team

What If I Have 2 Mortgages? Can I still sell my house?

Answer: Yes you can sell your house if you have 2 mortgages.  If you are underwater on your house and behind on your mortgage(s), you still have hope.  A short sale will require patience and a team of experts working for you from listing to closing.

During the foreclosure process your 2nd lien holder doesn't have any recourse if the 1st takes the house to auction.  They can purchase the house at auction and will have to compete with other investors, or they must write off their losses. During the foreclosure process nobody wins.  The 1st lender gets a house back that they must sell in order to recoup and money.  The homeowner loses their house and must move somewhere else.  The 2nd lien holder doesn't get anything and must move on.

With a short sale your 2nd lien holder has the ability to negotiate a settlement with the seller and 1st lien holder prior to closing.  During the foreclosure process nobody wins.  The 1st lender gets a house back that they must sell in order to recoup and money.  The homeowner loses their house and must move somewhere else.  The 2nd lien holder doesn't get anything and must move on.

With a qualified team working for you to list, sell, and negotiate with the bank you will have a smoother process start to finish.  It can take several months to gain approval on a short sale and so all parties must be patient.

To find out if you qualify for a short sale call today or fill out the contact form.  We are happy to assist you!

Spokane Short Sale Team

My Bank Offered Me a Deed in lieu | Spokane Short Sales

Sometimes my sellers are offered a deed in lieu and in most cases they end up accepting the bank's offer.  Sometimes a seller wants a buyer to get the house and they will pursue the short sale rather than giving the home back to the bank.  My advice is usually for them to accept the deed in lieu.

Going through the short sale process can take longer than expected and the buyer could end up walking before closing.  The deed in lieu is an agreement between you and the lender and it does not rely on the buyer completing the transaction.

Sometimes there are financial incentives the lender offers for a cooperative deed in lieu.  The home must be in good condition and the incentive works basically like a "cash for keys" type agreement.  You protect their investment and also save them from going through the foreclosure process.

For more information on a deed in lieu or how a short sale might work for you call us today!

Spokane Short Sale Listing | 5318 W Princeton

5318 W Princeton

This is a beautiful Shadle Rancher available at a great price! Don't wait on this one...bring your offer and see what the bank says.  This short sale will impress even the pickiest buyers!  Hardwood floors, nice backyard with private patio, and large basement with so much potential!

Call today to schedule a private showing!

The Myth Versus Truth About Short Sales

(Source: Freddie Mac) – 

In this installment of “Dispelling the Myths,” we’re focusing on short sales – when a property is sold for less than the balance remaining on the mortgage loan.  The short sale is an important tool for helping distressed homeowners avoid foreclosure and eliminate their mortgage debt.  And thanks to key changes we’ve made in the program, Freddie Mac short sales today are taking less time to process on average than ever before. But for a lot of borrowers, short sales remain a mystery.  Here are eight common misconceptions about short sales – and the facts every distressed homeowner should know. 

Myth: I will be responsible for the entire amount owed on the mortgage.
Fact:  Not necessarily. Under the Freddie Mac Standard Short Sale program, borrowers who complete a short sale in good faith and are in compliance with all laws and Freddie Mac policies will not be pursued by Freddie Mac for the entire amount owed under the mortgage. If you have the financial ability, you may be asked to make a one-time payment or sign a new promissory note for a portion of the unpaid balance after the short sale closes. Learn more.

Myth: I can’t get a short sale on an investment property or second home.
Fact:  Investment properties and second homes are eligible for a Freddie Mac short sale if borrowers meet the eligibility requirements.

Myth: A short sale is not an option for me because I’m current on my mortgage payments.
Fact:  Even if you are current on your mortgage payments, you may be eligible for a short sale.  In addition to meeting the general eligibility requirements, the property must also be your primary residence and your debt to income ratio must be greater than 55 percent.

Myth:  I won’t qualify because my servicer has strict guidelines on short sales.
Fact:  Every borrower is eligible to be considered for a Freddie Mac short sale providing they meet the eligibility requirements. Freddie Mac increased the authority of its servicers to approve short sales for qualifying financial hardships for homeowners who are past due or current on their mortgage payments. In addition, servicers now have the independent authority to approve short sales without a separate and potentially time-consuming review by the mortgage insurance company.
Myth:  A short sale will affect my eligibility for a new mortgage.
Fact:   If your financial difficulties were the result of income loss, medical emergencies or other extenuating circumstances beyond your control, you may be eligible for a new Freddie Mac mortgage once you’ve established acceptable credit for at least 24 months after completing the short sale. However borrowers who require a short sale as the result of personal financial mismanagement must re-establish acceptable credit for at least 48 months to become eligible for a mortgage backed by Freddie Mac.  You should start speaking to a lender about a new mortgage two years after your short sale closed.

Myth:  Short sales can take several months to complete.
Fact:  With Freddie Mac’s Standard Short Sale, the time lines are significantly shorter. Servicers have 30 days to make and communicate a decision to you once they receive your completed application. Once approved, you can expect to close on your short sale within 60 days – working with an experienced real estate agent can help expedite the process.

Myth:  I have a second mortgage on my home, so a short sale is not an option.
Fact:  If you meet the other eligibility requirements, you may be able to obtain a Freddie Mac short sale even though you have a second mortgage.  For example, under our short sale program, we are offering up to $6,000 to subordinate lien holders – who are like second mortgage companies – in exchange for releasing the subordinate lien, extinguishing the underlying indebtedness and waiving the right to pursue deficiency.

Myth: A short sale will ruin my credit score.
Fact:  While only the credit reporting agencies that calculate your credit score will know for sure, it’s possible that a short sale might be better for your score than a foreclosure. Even if it isn’t, a short sale gives you time to find a more affordable place to live and exit gracefully from your obligation.

Should You Consider A Short Sale?
If all retention options have been exhausted or are not possible, a short sale is a good alternative to foreclosure that allows distressed homeowners to gracefully leave their home and transition to more affordable housing. It’s also typically less damaging to a borrower’s credit report than foreclosure, and usually reduces the amount of time a borrower needs to wait to get a new mortgage down the road.

A short sale may make sense if you:
- Do not qualify for any options to keep your home, including a loan modification, forbearance, or reinstatement.
- Need to move in order to keep or obtain employment.
- Don’t think you could sell your home at a price that would cover your outstanding mortgage amount.

Steps To Get Started With A Freddie Mac Short Sale
- Find out if Freddie Mac owns your mortgage by visiting our Loan Look-up Tool.
- If Freddie Mac owns your loan, reach out to your mortgage servicer. Their telephone numbers and mailing address should be listed on your monthly statement or coupon book.
Source: Freddie Mac

Do I Qualify For a Short Sale?

How do you find out if you qualify for a short sale? Just because you are behind on your mortgage and you want to sell does not immediately qualify you for a short sale.  Your lender is going to look at a number of things when reviewing your eligibility.  

Do you have a hardship?  Is your home worth less than what you currently owe?  Have you made an effort to reach out to the bank?  Are you currently living in the home or is it rented to someone?  These are all questions that the lender is going to ask.

Calling a short sale specialist in your area can help you understand whether you qualify or not.  They will sit down with you and go through the criteria that is necessary to submit a short sale package and get it approved.  Hardships can be any number of things including a medical emergency, loss of employment, divorce, and many others.

Don't wait until the notices start appearing on your front door.  Reach out to your Spokane Short Sale Specialist today and find out if you qualify! 

Short Sale just Minutes to Fairchild Airforce Base | Spokane, WA

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821 S Quamash Ct
Beautiful 2009 built home in West Spokane's Sekani development just minutes from Fairchild Airforce Base. This home is loaded with upgrades and priced to sell! 1800+ finished sqft including a partial finished basement with 4 bedrooms 3 bathrooms and a 3 car garage. The backyard is great for entertaining with views of Mt Spokane. View it won't last.
4 Level
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Full Bath, 2nd Flr
Fr Stnd Rng, D/W, Microwave
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Partial, Finished
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Pub Rd, Paved
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Spokane Short Sales are a great opportunity for you to purchase a home at a great price!

3121 E 33rd | SOLD | Bank Approved Short Sale

This home was put on the market at a bank approved price of $140k and was sold in just days! Short sales work and this is just 1 example.  If you are experiencing a hardship and cannot afford your home, you have options.  You may even qualify for a relocation assistance from the bank.  Don't let your home go to foreclosure...speak with a real estate professional to determine your options.

What is the difference between a short sale and foreclosure?

So many times people ask why they should go through a short sale or just let the home go back to the bank...this video is a brief description about the differences between a short sale and foreclosure.  The credit ramifications, ability to purchase another home, and security clearances are all discussed in this video.

Did you know that a foreclosure is permanent public record?  You may not be able to purchase another home for at least 7 years...and security clearances could be in jeopardy after a foreclosure.  Watch the video and if you have questions call me today!

A short sale could save the future of your credit, eliminate your deficiency, and allow you to move on with your life with the ability to purchase again in a few short years.

What is deed in lieu of foreclosure? Why would the bank take a deed in lieu?

There are many ways to avoid foreclosure and a Deed in Lieu is one of the many options.  This is where the bank accepts the property in return for forgiveness or restructuring of debt.  In many cases the bank wipes the debt free and allows the homeowner to move on with their life.

Hire A CDPE To Sell Your Home

Handing the house back to the bank can have many positive impacts on a homeowner.  The first and most obvious is the fact that the homeowner avoids foreclosure.  The deed in lieu is considered a cooperative way for both parties to protect themselves.

Spokane Short Sale Specialist

Some of you may have received a call from a Realtor representing the mortgage holder on your loan.  They are offering a financial incentive in return for a deed in lieu.  This is a real program and the lenders are giving homeowners financial incentive to secure the home, make sure it's in reasonable shape, and free the property of any liens.  Once these tasks are complete the bank will pay the homeowner for the keys and forgive their debt.

If there is a second mortgage on the home or any damages, the homeowner can use the proceeds to pay for repairs or settle the additional liens.

Why is the bank willing to do this?  The lenders are facing an astronomical number of REO listings and foreclosures.  These processes take time and money and when the lender takes possession of the property through foreclosure there is no guarantee that the property condition will be acceptable.  It costs money to repair, hold, and sell these properties and the banks are liable for these costs.

If they can work a deal with the homeowner to turn over the keys, ensure the property condition, and allow the homeowner a chance to relocate...they are leaps and bounds ahead of assuming a property through foreclosure.  If you are eligible for this program don't ignore it!

Why Does The Bank Accept a Short Sale?

Many times I get asked by homeowners why the bank would accept less than what is owed on the property and forgive someone's debt on the mortgage...

In a short sale the bank's number 1 victory is that they do not have to pursue the foreclosure process which can be costly and result in them taking possession of the home.  During a short sale the homeowner is the "seller" and the bank is only approving the deficiency at closing.  This takes quite a bit of liability off of the bank.

When the bank takes a home through the foreclosure process they must pay for the notices, trustee services, winterizing empty houses, and it can be delayed several times.  When they get the home back it can be in a range of conditions depending on the homeowners who left.  They must assume electrical payments, taxes, insurance, etc. and protect their investment from squatters, theft, and vandalism.

To be able to avoid all of these risks, approving a short sale makes sense.

As a homeowner the bank appreciates your cooperation and that is why you are able to purchase a home earlier than if you let it go to foreclosure.

Call me today if you are interested in selling your home and you need help navigating through the paperwork!

What is a cooperative short sale?

Banks are now turning to local Realtors who specialize in short sales.  These agents are working to pre-qualify homeowners who are under water in their home and help them avoid foreclosure.  With a cooperative short sale, the banks work to set a listing price on the front end after they've qualified the homeowner.  When an offer comes in the bank has already determined what they are asking and what they will take.  They are able to answer the offers quicker and the closing process isn't such a headache.

Short Sale listings in Spokane

Most short sales fall apart because the buyer is tired of waiting and they just want an answer from the bank.  When you have a pre-set listing price and the bank has determined the seller's eligibility you eliminate most of the waiting and close more short sales.  Another good practice is that the bank initiates the price
reductions.  Sometimes they initiate dramatic price reductions...

Hiring an agent who knows the short sale process and can handle the paperwork will expedite the sale.  Banks are inundated with short sale requests and incorrect paperwork automatically sets you back.  Agents who have experience and relationships with lenders can assist you through the short sale process and make it as easy as possible.

It is no secret that a short sale takes longer than a traditional sale.  That doesn't mean that it has to be difficult on the homeowner the entire way.