“There is still a tremendous amount of misinformation out there with regard to options for upside down homeowners,” said Matt Battiata, Broker & CEO of The Battiata Real Estate Group, “and with almost 50% of San Diego homeowners upside down, and The Mortgage Tax Debt Forgiveness Relief Act expiring at the end of this year, there is a huge need for reliable, accurate information.”

Attendees will learn all of their options in dealing with an upside down home, including the various government and private loan modification programs available, short refinances, short sales, deed in lieu of foreclosure and foreclosure as well as the legal, financial and credit implications of each.

The seminar is free, but space is limited and past seminars have sold out. To register call 760-930-9898 or click here.

Home Affordable Modification Program SM (HAMPSM)
Principal Reduction Alternative SM (PRA)
Second Lien Modification Program (2MP)
FHA Home Affordable Modification Program (FHA-HAMP)
USDA’s Special Loan Servicing
Veteran’s Affairs Home Affordable Modification (VA-HAMP)
Home Affordable Foreclosure Alternatives Program (HAFA)
Second Lien Modification Program for Federal Housing Administration Loans (FHA-2LP)
Home Affordable Modification Program for Rural Development Loans (RD-HAMP)
Home Affordable Refinance Program (HARP)
FHA Refinance for Borrowers with Negative Equity (FHA Short Refinance)
Home Affordable Unemployment Program (UP)
Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets (HHF)

To find out if you will likely qualify for any of these programs, call Matt Battiata at 760-930-9898 or register for our upcoming Seminar for Upside Down Homeowners by clicking here.

Consider the following:

Banks currently own over 800,000 REO’s (foreclosures) that they have not yet put on the market, and are simply sitting on. They cannot yet afford to take the losses on these homes, so they are letting them sit vacant, accumulating fines, property taxes, back HOA dues etc.

There are 6,500,000 mortgages currently in default in the United States.

What is the cure rate of these mortgages (the likelihood that they will be brought current as opposed to going to foreclosure or short sale)?

30 days late: 29% Cure Rate (in other words, 71% will go to foreclosure or short sale)
60 days late: 5% Cure Rate
90 days late: 0% Cure Rate

While these are national numbers, these default properties are heavily concentrated in the hardest hit states of Florida, Nevada, Arizona and California.

Well, I am here to report that I now have first hand knowledge of this happening.

We just closed a short sale with a sales price of $420,000 in which the lender, JP Morgan Chase, paid the seller a $30,000 incentive to close escrow.

As lenders continue to see the benefits of short sales vs. foreclosure, we expect stories like this to become more and more common.

Click here to read the approval

The first is the actual short sale, which is reported on your credit as “debt settled for less than the amount owed.” This should not impact your credit until the short sale closes escrow.

The second is the missed payments, assuming that you stop making your payments. Contrary to popular opinion (even among realtors), it is not necessary to stop making your payments when you do a short sale. With that said, most people do stop making their payments, either because they cannot afford it, or because they make a decision to stop putting good money after bad. If you stop making your payments, this will have an impact on your credit almost immediately.

Depending on how good your credit is before you start the short sale process, and depending on how established your credit is, the short sale and the missed payments will have varying impacts on your credit. The better your credit is, and the more established it is, the less impact the short sale and missed payments will have on your credit. And vice versa.

The bottom line is that the impact of both the short sale and the missed payments varies for everyone, depending on your credit profile before the short sale.

I have seen a 50 year old homeowner, with very established credit and an 820 credit score, do a short sale, miss 7 months of payments, and end up with a 750 credit score. I have also seen a 23 year old with a 660 credit score miss 2 payments and see their score drop down to the high 500′s.

Again, it varies for everyone, depending on how good your score is and how established your credit is (in other words, how many years you have built your good credit up).

If you continue to make your payments during a short sale, you will minimize the impact of the short sale on your credit by about 50%, as you will not take any hit from missed payments.

WIth that said, industry experts view any impact on your credit from a short sale or missed payments as a relatively temporary hit, as it is possible to quickly repair your credit after the short sale has closed escrow.

For our clients who take steps to repair their credit, we see them buying within 12-24 months after a short sale, and in some cases less.

Ask your Battiata Real Estate Group agent for more information on our credit repair program.

Matt Battiata and The Battiata Real Estate Group will host their “Seminar for Upside Down Homeowners” at 5 convenient San Diego County locations Tuesday November 15 through Saturday November 19.

The dates, times and locations are as follows:

Tuesday Nov 15 Carlsbad: Carlsbad Resort by the Sea @ 6pm
Wednesday Nov 16 Escondido: California Center for the Arts @ 6pm
Thursday Nov 17 Mission Valley: Courtyard Marriott Mission Valley@ 6pm
Friday Nov 18 Chula Vista: Chula Vista Comfort Inn 632 E St @ 6pm
Saturday Nov 19 Del Mar: Del Mar Hilton @ 12 Noon

“This seminar is a great opportunity for any upside down homeowner who wants to educate themselves on their options, whether a loan modification, deed in lieu of foreclosure, FHA short refinance, bankruptcy / lien stripping or a short sale,” said Matt Battiata, Broker & CEO of the Battiata Real Estate Group.

“The seminar is 100% informational – it’s purpose is not to steer people in any particular direction – it’s simply a forum for homeowners to learn about and discuss their options so they can make an informed decision.

The Battiata Real Estate Group has held “The Seminar for Upside Down Homeowners” twice in 2011.

“Our first two seminars were so well received, and tapped such a huge demand, that we have been deluged with requests to do it again,” said Battiata.

The seminars are free but are expected to be full. You must register to attend by calling 760- 930-9898 or register online at http://battiata.com/short-sale-san-diego/seminar-for-upside-down-homeowners/

Bank of America said they will consider postponements if there is an offer in review, but only on a case by case basis.

In general, it has been our experience that we are able to get most Bank of America foreclosure sale dates postponed as long as we are actively engaged in the short sale process, so while this is not surprising, the fact that they have a policy in place regarding this is significant.

The lesson here, with regard to Bank of America as well as any and all other lenders, is don’t let yourself get significantly behind in payments before starting the short sale process.

Or to put it in a different way, don’t wait until you are in the 11th hour of the foreclosure process to start to explore your options – be proactive and find out about your options early.

In other words, once you find out that your loan modification is not going to get approved, or will not be significant enough to make staying in your home possible, or you decide to stop making your payments, start the short sale process.

It is true that lenders do not want to foreclose if they can avoid it – but if you get far enough along in the foreclosure process, you are playing with fire, and lenders will foreclose.

The Mortgage Tax Debt Forgiveness Relief Act, and its California state income tax counterpart, SB401, which exclude most homeowners from owing taxes on the debt forgiveness of a short sale, expire at the end of 2012, which means most homeowners’ whose short sales close after that date will owe income taxes on the amount their lender forgives in the short sale.

“We expect to see a deluge of short sales over the next 14 months in San Diego County,” said Matt Battiata of The Battiata Real Estate Group, ” as homeowners race to complete their short sales prior to the expiration of these tax exclusion bills.”

“Most short sales close in 4-6 months,” said Battiata, “but in some cases they can take a year or longer, so many people are getting started sooner rather than later just to be safe.”

06073 – Foreclosure Outcomes

06073 – Foreclosure Inventories

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The format for the seminar will be an educational forum for homeowners who are upside down on their homes to learn about their options.  Topics will include short sales, loan modification, bankruptcy and lien stripping, as well as deed in lieu of foreclosure and foreclosure, as well as the credit and tax implications of each.

“The focus of this seminar is to give people accurate information so they can make the best decision for their financial future,” said Matt Battiata of The Battiata Real Estate Group.

“There is so much misinformation out there on the web and even among so called experts with regard to loan modifications and short sales, that we really felt there was a need to educate homeowners,” said Battiata.

This is the second “Seminar for Upside Down Homeowners” that The Battiata Real Estate Group has held – the last one on July 30 was filled to capacity.

The Battiata Real Estate Group is the market leader in short sales in San Diego County.

To register, go to www.Battiata.com or call 1-800-980-0628