Orlando Renters Heating up the Market

As 2012 begins to kick into full gear, the real estate market is already heating up especially If you’re talking about rentals.  Renting has become the fastest-growing component of the overall Orlando real estate market over the last year, simply because fewer people are buying homes than they otherwise would in a good year. Falling home prices, incredibly-tight lending standards, and stubborn unemployment rates have all contributed to forcing the would-be buyers to the other side – renting.
This doesn’t mean that renting is inherently “bad” – for many people, renting is the cheaper and wiser option. Especially if you’re renting a house for less than what your neighbor’s mortgage payment is for the same size house.  But for those who want to build up equity in a home, break free of a landlord once and for all, and purchase a home at severely-discounted prices, renting just will not do. Fortunately (or unfortunately), renting will have a big impact on buying and selling of Florida homes in 2012, perhaps even more so than in 2011.
The fact is that the rental market across Florida as well as the rest of the nation will continue to improve as it did throughout 2011. In many metropolitan areas in particular, vacancy rates have plummeted and rental prices have risen sharply. This trend may taper off a tad, but more or less will continue throughout the year – meaning people will be paying more money to rent the same apartment in 2012 as they would have in 2011. If you’re looking for a great deal on renting or buying a house in Orlando, Florida contact me at 407-902-7750.

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Orlando Short Sale Agents in For A Busy 2012

I’m certain that we will see a steady flow of REO’s and Orlando foreclosures come on the market which is great news for buyers.  Orlando short sales will definitely continue to be a popular way for sellers to get their home sold when they owe more than their house is worth. This presents good opportunities for buyers to get pre-foreclosure homes before they go offline to linger in bankers’ files for months during the foreclosure process.

The combination of Disney World and warm weather year round is a huge magnet for world tourism which brings a certain amount of price stability that other markets just don’t have. Also, with new home construction basically at a “dead hault”, the existing Orlando area housing market is going to be very strong throughout 2012.

This means great opportunities for Orlando Investors. This also means more work for Orlando Short Sale Agents and pretty much anyone else who is an Orlando real estate professional.

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The difference between a Short Sale Agent and a Short Sale Expert.

When it comes to doing an Orlando short sale, many things come into play. One of the most important aspects of this particular home selling process is the agent that you choose. Your agent will be doing all of the negotiations for you with your bank as well as with the potential buyer; therefore, you have to trust your short sale agent.  In order to trust your agent, you should know important things about them before turning the steering wheel over to them when it comes to selling your home.  When picking an agent, it’s absolutely crucial that you do your research on that person.
The first thing you should do is research the agent’s background and area of Expertise. The best way to research the company is to utilize online search engines. Simply type in the company or the agent’s name followed by “reviews.” Within seconds you should be able to find numerous reviews from previous clients that will help you to determine the reputation of the company in which your agent is associated.  Also, as with anyone that you hire, you should take into consideration the agent’s real estate experiences. You can also ask the agent to provide you with references, which you can call to obtain detailed information from previous Short Sale clients. References can provide you with the best information about what to expect if you need to do a short sale on your house.
The problems occur when a homeowner hires an agent to do their short sale but the agent has never done one before.  Short sales are not easy and not all realtors have the skills, work ethic or experience required to be an expert short sale agent.  When homeowners make the mistake of not hiring the right agent for the job, the result can be disastrous resulting in your home getting foreclosed on.  If you’re in the market for a real estate agent that specializes in doing short sales do your research and find out everything that you can about the agent before making your decision.  You’ll be glad you did.

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A Wrench gets thrown Into Florida’s Foreclosure Process

In a very interesting case here in Florida, the 4th District Court of Appeals ruled that a foreclosure affidavit from a bank employee testifying to the validity and existence of original loan documentation on several Wellington, Florida foreclosures was hearsay because the employee had no first-hand knowledge of the documentation itself.

In other words, when challenged to prove the existence of paperwork showing that the bank owned the loan and could initiate foreclosure, the bank instead got an employee to swear that he or she saw “computerized information” showing the documentation – without having any knowledge of the document, the original contract, or anything else related to the case.  Can you believe it?!

This is pretty much the same thing as robo-signing, so it’s no wonder why the Court of Appeals decided to rule in this manner. To say that it has disrupted residential foreclosures in the state is an understatement, though, so it will be highly interesting to see what now comes out of a Florida we are already ridiculously behind on foreclosure processing.  I can’t wait to see what happens next.

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Short Sales Fraud On The Rise In Florida

The incidence of fraud relating to short sales is expected to rise by 25 percent in 2012. The loss to lenders and servers is projected to be more that 375 million dollars. Unfortunately, Florida is one of the states that is most at risk.

The Federal Bureau of Investigation (FBI) prosecutes mortgage fraud. Their definition is, “Any material misstatement, misrepresentation, or omission relied upon by an underwriter or lender to fund, purchase, or insure a loan.” The reason that short sales have become attractive to those wishing to perpetrate fraud is that the loans are held by the second lender without any equity. In order to make any money at all on the transaction, they must either receive a portion of the payment made to the primary lender, or be paid a fee by the seller. Sellers and buyers are often in a hurry to close, and so are susceptible to giving in to the demands of the second lender, especially if they are not supported with the knowledge and experience of a real estate professional.

One technique is the back-to-back closing, in which a property is resold on the same day as the original closing. For this to occur, there must be two unrelated contracts, one for the short sale lender and a contract with a third-party for purchase of the property. The contracts are processed in the reverse order, so that only the most alert Escrow agent will notice anything suspicious.

Some unscrupulous investors will list a property that they have no authority to list, at a price that is lower than a lender will accept as a short sale. The intention is to create a bidding war, select the highest bid while negotiating a low price with the lender. The investor then completes a back-to-back closing and keeps the difference.

Other suspicious transactions include those with a sale price of 10 percent or more higher than the prior, short sale price within less than a month; a sale price within three months that is 20 percent or more over the short sale price; and a transaction within six months that has a price of 40 percent or more than the short sale price. Some of these transactions are legitimate, when a buyer has had the revenue to undertake and complete improvements on the home.

Homeowners looking to purchase, as well as those looking to sell, a short sale property must be aware of the different types of fraud that are being perpetrated. Agents and other real estate professionals must be educated about them as well, because they are the best resource for protecting buyers and sellers from falling for fraudulent practices.

For the reasons described above, it is most often the junior or second lenders that are involved in fraud. All investors and lenders used should be assured as legitimate by checking their license status and reputation. An “arm’s length affidavit” should be prepared, which attests that there are no undisclosed agreements between any parties. This document is required by many primary lenders.

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Freddie Mac Encourages Florida Short Sales

The Federal Home Loan Mortgage Corporation, more often known by its friendly nickname of Freddie Mac, recently hosted two events in South Florida for local real estate professionals. In this area, which includes Miami Springs and Davie, where the events were held, has approximately 40,000 homes that are lender-owned, and many more that are in some part of the foreclosure process.


The Freddie Mac events provided estate professionals with detailed information about the requirements for short sales. Freddie Mac, as well as Fannie Mae (the Federal National Mortgage Association), avidly promotes short sales over foreclosures. The events were intended to help real estate professionals who may not be as familiar with the short sale procedure gain some understanding of the intricacies of the process, in order to better serve homeowners.


The events discussed the various parties that are involved in short sales, and how agents interact with each of them. They described the short sale process, which is regulated.

They reviewed the required documentation, described what to cover in a pre-listing interview with the seller. When the mortgage is held by Freddie Mac, there are some additional benefits that can be gained. These include an enhanced payoff program, more willingness to look at all deals being offered, and an increased delegation to the seller’s server.


In Florida, the foreclosure process can take quite a long time, and often leaves homeowners with deficiency judgments, lawsuits that result from the unpaid mortgage debt. Short sales are a more appealing option because they protect against deficiency judgments. They are not necessarily less complex than a foreclosure, but they do benefit all the involved parties better.


The seller, and the neighborhood in which the home is located, avoid the stigma associated with foreclosure, which can lead to a snowball effect on the market. The mortgage insurance company is able to minimize its losses. The investor avoids the additional expense and effort of an REO. The real estate agent closes a sale, earning a commission and standing in the neighborhood.


Freddie Mac owns about 60,000 properties across the United States at the present time. They are strongly committed to selling to homeowners, rather than investors or those who purchase homes with the intention of flipping them. Currently, about 70 percent of the homes sold by Freddie Mac go to homeowners.


As many as 50% of mortgages go into foreclosure with no personal contact with the borrower. Freddie Mac is actively engaged in educating homeowners, agents, and lenders with the goal of reducing that number to zero. A study found that many homeowners are under informed about the options that are available to them when they are having trouble meeting mortgage payments.


Freddie Mac also hosts foreclosure prevention workshops for homeowners. A full list of dates and locations is available on the Freddie Mac website. These workshops cover all the options for staying in the home, including refinancing, forbearance, reinstatement, repayment, and modifications. They also cover the options for exiting the home gracefully, short sales and deed-in-lieu.


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To Meet or Not to Meet…. The BPO agent

There is no simple ”yes or no” answer to this question. Over the years I’ve tried many different approaches when it comes to handling the BPO agent. When I first started out in this business I would meet them at the house and provide them with a CMA on the property. I found that some agents would appreciate this while others resented the effort and they took it as me trying to tell them what to do resulting in a very high BPO. Other times I would provide them with a contract with the price that I wanted it to come in at. The challenge is to find out what kind of personality you’re dealing with because everyone’s different. Some agents are compassionate towards other people and when you explain the situation about the seller’s hardship and how you’re trying to help them, then they will also want to help. These agents will go the extra mile to try and get you the price you need in order to help the seller and get the deal done. However, there are other agents that are like dealing with robots. These agents don’t care, don’t want to know, and couldn’t care less about what the situation is. When I encounter someone like this, I don’t offer them any paperwork at all because not only will it not help but they will probably go out of their way to make the BPO higher than it should be.

Another approach I’ve used that has worked well for me is to tell the BPO agent that the bank wanted me to do my own BPO report in addition to the one they’re doing. Remember, the BPO agent usually gets hired by an agency and they have no idea what the situation is. They can’t get mad or offended because you’re there to do a job just like they are. It’s very common these days for the banks to order 2 BPOs anyway and if they see me taking pictures of every single piece of damage in the house to put in my report, then what do you think they are going to do?  They don’t want their report to look less complete than mine so you can bet they won’t miss a thing either. In this situation you may even get a chance to share and compare notes.

One of the most effective techniques I’ve used and still use sometimes is to be nice, play dumb and ask a lot of questions on how the process works. By doing this, I find out for sure if the agent is doing what he or she is supposed be doing. I will ask them things like “so you’re here to give a value according to a quick sale price right?” or “So what happens next after you complete your inspection?” This approach in non offensive and you will find out a lot about what type of personality you’re dealing with. I will even ask them at what price they think it will come in at if I feel comfortable enough with them. They worst thing they can say is “I’m not allowed to tell you that”.

There are certain agents however, that no matter how nice or cooperative you try to be with them, they are just disgruntled and bitter on life and will actually go out of their way to mess up you’re deal. After a while you know exactly who they are because if you do a lot of short sales in the same areas you will get the same BPO agents over and over and it’s very easy to track which ones are good to work with and which ones are not. What I do with the bad ones is put them on my “Black List”. That way everyone in my office knows that when one of these names come up it gets handled differently. Whenever I get one that’s on my blacklist, I just don’t cooperate. When they call to set an appointment, I will usually tell them that the seller is out of town for a week or some other reason that will force them to turn it back over to the agency or bank since these reports are usually due in 72 hrs from the time they get assigned. Don’t get me wrong, this doesn’t happen that often and there are only a handful of agents on this list. However, if I know for sure someone is out to mess me up then they will be treated the same way.

I hope I didn’t offend any BPO agents with this post but short sales are a lot of work and at the end of the day we should all be working together to clean up this housing market. The BPO is an intricate part of doing a successful short sale and if you are doing BPOs, you should understand that the banks are pretty much clueless and they are depending on you to help get them get the deal done. Try and find out about what the situation is from the agent and be part of the solution not the problem.


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Another Foreclosure Sale Stopped Just an Hour Before!

At 9am this morning we received a frantic call from a buyer’s agent on a deal that we are closing at the end of this week. Supposedly the auction date of today August 1st at 11am was put on hold according to One West Bank and we even had a motion to cancel letter from the foreclosing attorney. The agent was checking on line and found that the sale was still on schedule! After wasting time calling the lender and trying to get something done we only had one option left and that was to drive down to the courthouse with the seller and a stack of paperwork on the file including the contract, payoff letter, etc. and personally file a motion to cancel the sale. We got there at exactly at 10am with the sale scheduled for 11am. With less than an hour left before the sale we had the seller file a motion to cancel the sale together with all the paperwork and I’m happy to say that it worked!


We’ve been working this short sale for months with constant communication with the bank and them telling us that the sale was on hold and everything was on track to close. It just goes to show that you can’t leave it up to them to do what they promise they would do. I’m not sure exactly who dropped the ball or if it was intentionally dropped, but I am sure that if we hadn’t taken action and gone down there ourselves to personally file the motion to cancel the sale, it would have gone to sale. Although we haven’t had a close call like this in a while, it was a good reminder to us that sometimes there is a huge disconnect between the banks and the court system and you just can’t leave it in their hands. The fact is that a $10.00 per hr negotiator doesn’t have anything at stake and they probably couldn’t care less about the seller losing their house or you losing a deal.


The common belief is that you need an attorney to file this type of motion…not true. However, the seller needs to be with you or you must have a power of attorney from the seller. Also, you must have all the paperwork with you that support your claim because if the judge is still not convinced, he can still let the sale happen.

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You HAFA Give It A Try!

Many of the agents that I speak with wait to start the short sale process until they have an offer. Big mistake!! Why wait?… Why not try and make some headway with banks before you even have an offer? Maybe the seller can go HAFA (Home Affordable Foreclosure Avoidance) program. The HAFA program offers full deficiency release, $3000 seller for moving costs once approved, and the bank is able to make a decision 10 days after they get an offer. Unfortunately, inexperienced agents would rather wait to get a buyer before even considering HAFA. Don’t wait…get the ball rolling, this will help you to put time on your side not the bank’s.

Once you get a short sale file, research the options that are available for that seller and get moving on something. Most people aren’t even aware that the HAFA program exists so you should definitely find out if you can get them qualified. Even though I’m always the buyer on my short sale deals, I still try to exhaust every option I can to do what’s best for my client. Even if it means that I will make less money on that deal.


In my experience I’ve found that if you make it not about the money…in the long run you’ll make more money. I’ve gotten countless referrals over the years by going the extra mile for people.


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NACA Making a Big Splash!

For those of you who are not yet familiar with NACA… get familiar. It stands for Neighborhood Assistance Corporation of America NACA’s  Home Save Program is nationally recognized as the most effective solution for homeowners with an unaffordable mortgage providing these solutions nationwide as the largest such organization. The NACA solution is to restructure the existing mortgage by permanently reducing the interest rate to achieve an affordable mortgage payment. A mortgage restructure is not a refinance that requires eligibility for a new loan (i.e. high credit scores, high property values, etc). Since a restructure reduces either or both the interest rate and/or mortgage principal on the existing first mortgage, there are no mortgage criteria eligibility restrictions. If the homeowner is unemployed NACA provides a forbearance with a minimum payment until that have steady income to have their mortgage restructured. The only homeowners not eligible are investors who own other properties. NACA’S Save the Dream events are amazing with thousands of people having their mortgage payment permanently reduced by over $500 and many by over a $1,000 a month often with interest rates reduced by 3% or 2% and sometimes a principal reduction. They have legally binding contracts with all of the major lender/servicers, including Fannie Mae and Freddie Mac to make mortgages affordable. Many people actually receive a permanent restructure the same day! The best part is that all NACA services are FREE.

       In addition to their Home Save program they offer a PURCHASE PROGRAM
NACA provides the best home purchase program in America right now. NACA provides free personalized and comprehensive counseling to all Members to address your particular credit and financial issues and help determine a mortgage payment you can afford. NACA’s counseling and underwriting criteria are “character-based” and not based on credit scores and ratios. This enables them to fulfill their mission of assisting working people who otherwise do not have access to affordable credit. Consequently, the vast majority of NACA Members are low- to moderate-income many of whom have neither perfect credit nor substantial savings.

The NACA mortgage is unique in that everyone receives the same incredible terms which makes homeownership affordable and you do not need perfect credit.

  • No downpayment,
  • No closing costs,
  • No fees,
  • Fixed 30 year below market rate at 4.125% (as of 7/15/2011).

NACA has established an extremely effective process for you to work through the process. They have established a personalized web-page called a Web-File for each member in their program. Your Web-File is specific to your specific circumstances that provides updated information as well as your status as you work towards purchasing your home. It provides you with updated information including your Task List which identifies your what additional documents and items necessary, ability to make an appointment with your mortgage consultant, conditions necessary to get your bank application approved, and much more.  

My broker/wife has referred over a dozen people to NACA just in the last two months alone and they love her for it! People have everything to gain and nothing to lose. If you know someone that could use a mortgage restructure or buying a home you would be doing them a huge favor by telling the about NACA.

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