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As a real estate industry insider over the past several years, but never a broker or a real estate agent, I’ve always thought most consumers have no idea what it’s like to be a real estate agent. We all know that people resent the hell out of real estate agents/brokers and have little respect for them. I mean, to be ranked below actors and union leaders — that’s just harsh.

Real estate is a weird business. It’s a major pillar of the American — nay, global — economy, as the current malaise shows, and yet so few people understand it.

Buying a home is the biggest financial transaction for the vast majority of Americans, and yet because they do it so infrequently, most consumers don’t have a clue about a process that could put them into debt for the rest of their lives. And people’s impressions of real estate agents is formed more by movies, TV shows and commercials than reality, because they simply don’t interact with them often enough to gain an informed opinion.

Think about it. You see your doctor a few times a year. You see your accountant at least once a year. If you have a lawyer, chances are that you see him or her at least a couple of times a year. You see a real estate agent once every seven years, if you’re the average consumer.

The first and most important thing that real estate agents wish you knew about their job is how hard you make it on them.

Otherwise rational, highly intelligent, highly educated people can lose their minds when it comes to their homes. I’ve heard more than one story of how a Wall Street investment banker, whose day job is to take cold hard looks at companies and put values on them, simply can’t accept that his home isn’t worth what he thinks it ought to be worth. Why hire an expert, paying them extraordinary amounts of money (5 or 6 percent of a house sale is rather a lot), then ignore their professional advice?

More fundamentally, you don’t pay for their time. Real estate may be the last pure commission job left in America — even retail sales has notions of draw-against-commission. An agent could spend three months and a few hundred hours working for you, showing you house after house, negotiating contracts, working through difficulties, and a hundred other things besides, only to have you change your mind at the last minute and decide to buy somewhere else. The agent made exactly zero dollars from that work. (Someone is going to point out that lawyers work on contingency all the time. True, and they also take 30 percent to 40 percent of the award.)

Real estate is the only “profession” in which the professional owes a fiduciary duty to a client who isn’t paying him. All the liability, all the risk, and a relatively small reward (compared to other success-based endeavors) are the hallmarks of real estate. So like venture capital (another high-risk endeavor), real estate agents practice a form of portfolio management: They expect that the vast majority of their deals will fall through, and hope that the one that hits will pay enough to cover the costs of all those that did not. And that, my friends, is why your real estate commissions are so freakin’ high: You, the successful buyer or seller, are subsidizing all of those flaky buyers and sellers who had a change of heart, couldn’t qualify for financing, had unrealistic expectations, and so on.

To be fair, agents share some blame, too. If they refused to work for free, chances are the industry would have evolved in a different direction. But we are where we are. As we will see in future columns, this particular structure of the industry creates all sorts of interesting effects that real estate agents wish you knew about their job.

But for now: Next time you’re in the market to buy or sell a house, and you’re thinking about hiring a real estate agent, ask yourself just how serious you are about it. Are you just testing the market to see where your house would sell for? Please try not to waste an agent’s time. Are you a buyer, but don’t have a clue in which of the 17 nearby towns you might be interested, or what you could actually afford to buy? Try not to think too badly of the real estate agent to whom you represent a whole lot of risk. And when it comes time to pay the piper, understand that you’re paying not just for you, but for every buyer and seller who flaked out on that agent.

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Re-posted from AOL real estate news

Bank of America and Citigroup incorrectly accounted for billions of dollars in debt over the past three years, according to a report from the Wall Street Journal.

The report highlights a form of corporate borrowing increasingly under scrutiny since the financial crisis began. The loans, known as “repos,” or short-term repurchase agreements, allow banks to increase the amount of risk they can take in securities trading.

Both BofA and Citigroup disclosed in filings with the Securities and Exchange Commission that they have over the last three years accidentally classified some repos as sales when they should have been classified as borrowings, the newspaper reported. The amounts involved were small for the banks, though they totaled billions.

It is illegal under federal securities rules to intentionally conceal debt and mislead investors. Bank of America and Citigroup claim the accounting flaws were purely accidental and represent minute portions of their overall operations.

Bank of America, in addressing errors that reached up to $10.7 billion per quarter, noted that the flaws ”represented substantially less than 1 percent of our total assets,” the Wall Street Journal reports.

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reposted from CNBC.com

If you or someone you know has a Wachovia Home Loan and has a hardship and can no longer afford their mortgage you could qualify for a short sale or loan modification. I’m in direct contact with Wachovia’s Loss Mitigators and they are encouraging us Realtors to spread the word that they get and know that time is of the essence when selling a home.

TIME FRAME FOR AN APPROVAL WITH A WACHOVIA SHORT SALE

The time frame that was quoted to me after listing your home and getting a qualified buyer to purchase your home is approximatley 7 days, and an average of 45 days to close depending on if there is just Wachovia as the first lien holder and if there is a junior lien involved as well.

YES YOU CAN LIST YOUR HOME AND TRY TO GET A LOAN MODIFICATION AT THE SAME TIME

The loan modification is encouraged also if you want to stay in your home and even if you’re behind on your payments you might still qualify. You can list your home and get the loan modification process at the same time and the decision will be made whether you are a candidate or not for the loan modification or the short sale. If you’re currently unemployed and or do not want to stay in your home your best solution will be to short sale your home and salvage your credit.

Call Today! (310) 493-9678

Lea Anderson
dre#01704736

As terrible as it is to lose your house to foreclosure, at least it’s a relief to put your biggest financial headache behind you, right?

Wrong.

Former homeowners may still be on the hook if there’s a difference between what they owed on their mortgage and what the bank could sell it for at auction. And these “deficiency judgments” are ticking time bombs that can explode years after borrowers lose their homes.

It can even happen to people who got their bank to approve them selling their home for less than it is worth.

Vanessa Corey, for example, short sold her Fredericksburg, Va., home in April 2008. She and her husband built the house in 2004, but setbacks, both personal (divorce) and professional (housing bust), made it impossible for the real estate agent to keep her home. So she negotiated the short sale and thought that was the end of it.

“My understanding was that the deficiency was negotiated away,” she said. “Then, last November, I got a letter from a lawyer telling me I owed my lender $65,000. I had to declare bankruptcy. There was no way I could pay it.”

Many homeowners are now in the same boat. And not just those who took out bigger loans than they could afford or who did so called “liar loans” where they didn’t have to verify their income.

Because of falling home prices, borrowers who always paid their mortgage but who have run into unforeseen circumstances — like unemployment or a job transfer — can no longer sell their homes for what they owe. As a result, they are being forced to short sell or foreclose and are getting caught up in deficiency judgments.

“After the banks foreclose, it’s very common now to have large deficiencies with houses not worth the balances owed,” said Don Lampe, a North Carolina real estate attorney.

Lenders mostly declined comment. Although Corey’s lender, BB&T did indicate it was pursuing more deficiency judgments.

“They follow the rise and fall of foreclosures,” said the spokeswoman, who would not discuss Corey’s account.

Can they come after you?

Whether banks can and will pursue deficiency judgments depends on many factors, including what state the borrower lives in and whether there’s a second mortgage or other liens. But if borrowers ignore the possibility of deficiencies, it could haunt them.

“Once they have a judgment, they can pursue you anywhere,” said Richard Zaretsky, a board-certified real estate attorney in West Palm Beach, Fla. “They can ask for financial records, have your wages garnished and, if you fail to respond, a judge can put you in jail.”

In the case of foreclosure, lenders can pursue deficiencies in more than 30 states, including Florida, New York and Texas, according to the U.S. Foreclosure Network, an organization of mortgage law firms.

Some states, such as California, are “non-recourse” and don’t allow deficiency judgments. But, even there, if the if the original loan was refinanced, some or all of it may be subject to claims.

Deficiency judgments on short sales and deeds-in-lieu can happen in many more places. In these cases, extinguishing the debt is often a matter of negotiating with the bank.

But even when lenders are willing, many borrowers may not be aware that they have to ask for release. So, if you are pursuing a short sale, be sure your attorney asks the bank to release you from any further obligation.

“People shouldn’t have a false sense of security that a deficiency judgment may not be later sought,” Zaretsky said.

He expects many will be filed over the next few years, based on the fact that banks have sold many of these accounts to collection agencies and other third parties, at discount.

“The parties who bought those notes wouldn’t have paid money for them unless they had the intention of acting,” Zaretsky said.

Ticking time bomb

What can be scary is that the judgments don’t have to be obtained immediately. Lenders or collection agencies may wait until debtors have recovered financially before they swoop in. In Florida, the bank can wait up to five years to file. Once the court grants a judgment, the lender has 20 years there to collect, with interest.

It doesn’t have to be a large amount of debt for a lender or collection agency to come after borrowers. Richard Varno and his wife short sold their Nashville home back in 2004 after he lost his job.

It wasn’t until 2008, when the second lien holder asked him for $25,000, that he realized he still was liable.

“I told them, ‘Hey, you guys released the title,’” he said. “As far as I know, I’m off the hook.”

He wasn’t. Releasing title does not necessarily end the debt. It’s complicated because of variations in state law, but, generally, a mortgage has two parts: a pledge of collateral, represented by the home, and a promise to pay off the loan.

Lenders may release property liens in order to facilitate short sales without releasing borrowers from their obligations to pay under the promissory notes. The secured debt can convert to an unsecured one after the sale.

Zaretsky had one client who was so relieved to have arranged a short sale that he signed every paper his real estate agent shoved at him, even a confession that clearly stated he still owed the debt.

“He had no idea what he was doing,” said Zaretsky. “All the lender had to do was go to court to convert the confession into a deficiency judgment.”

Lenders are also very inconsistent. One of Zaretsky’s short-sale clients was ready, willing and able to pay, but the bank did not even ask; another lender always reserves the right to pursue the deficiency.

Strategic defaults

Sometimes lenders go after borrowers walking away from their homes if they have other assets, according to Florida real estate attorney Larry Tolchinsky.

“Banks are pulling credit reports to see if it’s a strategic default,” he said. “If you’re behind on all your other payments, you’re okay. But if you’re not, they’ll come after you.”

If borrowers have any doubts about their risks, they should seek legal advice. Or, at least, call non-profit organizations such as NeighborWorks for advice. According to Doug Robinson, a NeighborWorks spokesman, its counselors always try to negotiate away deficiencies when they facilitate short sales or deeds-in-lieu.

“We don’t favor any short-sale contracts that leave any deficiency that can be pursued,” he said.

Robinson himself knows what can happen. He paid off a deficiency after his own New Jersey house went through foreclosure 11 years ago.
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re-posted from cnnmoney.com
By Les Christie, staff writer , On Wednesday February 3, 2010

I hope this post has been informative to you or someone you know. If you have questions regarding short sales and foreclosures, feel free to email or call me.
Lea Anderson
B.A. Clark Realty
5633 Overhill Drive
Los Angeles, CA 90043
(310) 493-9678 direct
(323) 294-0094 x227 office
DRE#01704736

Understandably, homeowners who apply for a loan modification tend to get a little antsy and perhaps even annoyed when they apply for a loan modification and then fail to hear anything for several weeks, especially if they continue to receive late payment notices and nasty phone calls from collection agencies. Many homeowners wonder, “How long will it be before I hear anything?” and “What should I do while I’m waiting.”

How long will it take? The loan modification process typically takes 30 to 90 days, depending mostly on your lender and your ability to efficiently work through the process with your attorney or other loan modification representative.

Note: The loan modification timeline is not set in stone. The more complex your situation or the greater the degree of concessions needed from the investor, the longer the process takes. Borrowers with a lot of collateral issues can see their loans take longer than what has become the typical 30- to 90-day timeframe.

A professional can often reduce the amount of time required by processing your paperwork efficiently, presenting your application exactly the way the lender wants it, and knowing from past experience what the lender is able and typically willing to agree to. Although each borrower’s situation is unique, knowing the measures the lender is willing to take for similarly situated borrowers can be a real time saver.

Whether you are dealing directly with your lender or through a loan modification specialist, ask several questions up front:

How long is the process likely to take? Find out the best- and worst-case scenarios and then count out the days and mark them on your calendar.
When can I expect to hear something about my case? Mark this date on your calendar.
If I don’t hear anything by the specified date, whom should I contact? Get the person’s name, employee identification number (if available), phone number, and any extension you need to dial to reach the person directly.

What should I do while I’m waiting? Playing the waiting game can be agonizing, particularly when you have no idea of whether your application will be accepted or rejected or what the lender will offer in terms of a workout. It feels like your future hangs in the balance, and you remain in the dark. Knowing the standard timeline for processing a loan modification can certainly help relieve some anxiety. In addition, you can continue to make progress on your own by doing the following:
If you hired a loan modification specialist to represent you, do not speak with your lender or lender’s representative. Refer all matters to the professional who is representing you. Anything you say to the lender could confuse things or compromise your representative’s ability to negotiate the best deal on your behalf.

Log all phone calls and correspondence between you and your lender or representative. Write down the number you called, the person you talked with, what the person said, and what you said – not word for word, just jot down the key points.

Keep track of important dates. If you do not hear something back on the date promised, call the next day to find out what’s going on. Lenders almost never call you back with updates. If you hired a third party representative, they will (or should) keep you posted, but the lender simply doesn’t have the time to make follow up phone calls. If you’re dealing with your lender directly, you’ll have to be the one making the calls. Mark your calendar and schedule periodic update phone calls. Consistent follow up is paramount to a successful modification.

Explore other options. If the lender denies your request for a loan modification or presents an offer that you cannot accept, you will need a plan B (and maybe a plan C and a plan D). In addition, other options may be better for you than a loan modification. Consult a real estate agent about listing your home for sale. Talk to a mortgage broker or loan officer about refinancing. Speak with a bankruptcy attorney to find out whether filing bankruptcy would be a better choice.
Don’t be surprised if you continue to receive delinquency notices or late payment phone calls. Lenders rarely put a stop on the foreclosure process until a workout solution is fully in place. You should ask your lender if your attempts to negotiate a solution will stop or at least postpone other collection actions. If they do not, you should find out what that means for you. If the lender is able to foreclose in 30 days and a workout takes 60 days, there’s a slight timeline problem. Push to have all default and foreclosure actions put on hold while your workout attempts are underway.
When your fate is in someone else’s hands, 30 to 90 days can seem like an eternity. By doing your part to keep the process on track, remain informed, and explore other options, you not only improve your chances of achieving a positive outcome, but you can also reduce the stress that commonly accompanies the waiting process.

Re-posted from Realty Times
By Ralph Roberts

The team from ABC’s heartwarming and popular reality series “Extreme Makeover: Home Edition” may give worthy families a whole new house. But yet another family who appeared on the show learned that they don’t guarantee you’ll keep that house forever.

The Wofford family of Encinitas, California, got their house from the show five years ago, but now claim that after struggling for two years to pay their bills, they’re facing foreclosure . Dr. Brian Wofford, a widower and father of eight, explained the crisis, telling 10News: “A lot of people think when you get the house, you get the mortgage. Well, you don’t.”

The Woffords aren’t the first family featured on the show to face serious financial problems after their home makeover. The Harper family of Atlanta, who received the show’s biggest house to date, along with the money to pay taxes on it for 25 years, famously faced foreclosure last year after taking out an ill-advised $450,000 loan using the house as equity. And at least four other “Extreme Makeover” recipient families have had to sell or lose the homes they won on the show. ABC is probably considering changing the show’s rules (maybe the houses don’t need to be quite so lavish, for example) to help avoid such disasters in the future.

However, there’s still hope for the Woffords. Loan modification papers are being promised by their bank, OneWest, next week. If they don’t go through, the house will be auctioned by the bank in two weeks, but Dr. Wofford is optimistic about his family’s future: “If I have my family and I live in a tent, I’m in good shape. Better be a big tent though.”

The San Francisco metro area has seen its home values drop by a quarter, and the city still has some pain to work through. The city’s median home price is expected fall another 8.3% by June 2010.

After that, however, the market there may come roaring back: Fiserv predicts a 14.3% gain between June 2010 and June 2011. Averaged out, that means a 4.8% gain over the next two years.

One reason for the sharp comeback is that much of the area’s excess inventory will have been sold. It’s already dropped by nearly in half over the past year.

The recovery will be delayed, though, as the area — particularly Oakland and the East Bay — works through its foreclosure problems. During the first six months of 2009, one of every 52 homes had at least one foreclosure filing.

The good news, according to Mark Fleming, chief economist for First American CoreLogic, is that core city neighborhoods don’t have nearly as many foreclosures as those out on the fringe. The steady demand in those communities will serve as a base as other neighborhoods rebuild.

reposted from cnn.com
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Lea Anderson is a real estate agent serving the communities of View Park, Ladera Heights, Baldwin Hills and Leimert Park. For a FREE consultation call/text her today (310) 493-9678.<a

Former Baywatch babe, Pam Anderson, seems to be fighting a lien filed against her by a construction company. The former actress apparently owes the company over 600k for building her house. Anderson is disputing the allegations that she is having financial problems.

In a statement sent out by Pamela she said her lawyers were reviewing the situation with the construction company. Pam also stated, “Mistakes may have been made in calculating taxes owed and we are now in the process of ensuring that any taxes owed are paid.”

Pam Anderson has recently been promoting a new clothing line she created with Richie Rich called, A*Muse.

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Reposted from celebforeclosure.com

NEW YORK (CNNMoney.com) — A controversial $3.9 billion federal program aimed at saving neighborhoods blighted by foreclosure is hitting hurdles that could threaten its effectiveness.

The Neighborhood Stabilization Program, passed by Congress last year, gives states and localities money to acquire and rehabilitate abandoned properties. The big problem: officials are having trouble getting their hands on those houses, which are being scooped up instead by private investors and homebuyers at rock-bottom prices.

“Getting hold of the houses, especially the right houses, can be a lot harder than they thought,” said housing expert Alan Mallach, a non-resident senior fellow at the Brookings Institution. “They are finding there’s a lot more competition for these properties, and they are losing out to investors.”

Some locales now fear that they won’t be able to commit their allotment to specific projects by next fall’s use-it-or-lose-it deadline, forcing them to expand or change the scope of their efforts. But altering the plans may lessen their success, experts said.

“The challenge has been to get this money into the field and working,” said Michael Tierney, chief operating officer of Local Initiatives Support Corp., a community development organization. “It’s moving more slowly than we anticipated. I don’t think it will have as much impact as we originally hoped.”

CNNMoney.com spoke to federal and local government officials, community development groups and housing experts to determine how the program is progressing a year after its enactment. During that period, the foreclosure crisis has only gotten worse and is expected to continue declining.

There are 2.5 million homes in the foreclosure process, with about 750,000 in the hands of banks, according to Mark Zandi, chief economist with Moody’s Economy.com. As many as 4 million foreclosed homes will be sold by the end of 2011, he estimates.

The debate over the neighborhood stabilization initiative has been contentious from the start. Supporters said it would help eliminate blight and stop home values from plunging. Opponents argued that the paltry sum wouldn’t do much considering the vast supply of vacant homes on the market.

Recognizing the severity of the problem, the federal government allotted another $1.9 billion to neighborhood stabilization as part of February’s stimulus package. That money has yet to be distributed.

The program’s initial stage — during which officials must contract with banks and developers — is the most difficult, said Mercedes Marquez, assistant secretary at the Department of Housing and Urban Development.

Before they see a dime, state and local governments must tell HUD how and where they plan to use the funds. Many have never been involved in this type of work, making the ramp up even more challenging. Often, officials hire nonprofit groups to do most of the acquisition, rehab and financing.

“It’s a lot of work to implement,” said Marquez, who feels the program is on track overall.

So far, some 13.8% of the funds have been obligated for a variety of uses, including buying and rehabbing foreclosed homes, demolishing decrepit ones and helping homebuyers purchase and renovate foreclosed properties.

To be sure, some locales are further along than others. Certain big cities, such as Chicago and New York, have the necessary staff and experience. Some have already turned vacant properties into livable homes.

Others, however, have yet to buy a single house.

Among the stumbling blocks has been acquiring foreclosed homes from the banks at the required 1% discount to the appraised value.

To really be effective, states and local officials must target abandoned homes in specific neighborhoods or even on particular streets. But that could involve complex negotiations with multiple banks. And, with housing markets starting to revive in many locales, financial institutions are often more eager to sell to private buyers.

Take what’s happening in the city of Orlando, which is using its $6.7 million allotment to turn foreclosed properties into affordable housing and to provide downpayment assistance.

Buyers are flooding the Florida market as home prices plunge. The median price for a single-family home in the Orlando metro area is down 29% in August compared to a year earlier, and sales are up 48%. That makes it all the more difficult for Orlando officials to secure properties.

“We thought the banks would be so happy to see us coming with our money,” said Lelia Allen, director of the City of Orlando Housing and Community Development Department. “That has not necessarily been the case.”

So far, the city and its nonprofit partners have purchased five properties, spending about $322,000. They have 17 offers out on homes worth a total of $1.2 million.

Knowing that her department has to commit all its money by next fall, Allen is making changes to the original plan. She has expanded the size of the targeted neighborhood in order to have more foreclosed properties to choose from. And she’s planning to ask HUD whether some of the money can go to grants for people who buy foreclosed homes on their own, but need help financing the renovations.

Even places that are confident they can meet the deadline are finding the process challenging. It’s particularly tough to put together rehabilitation proposals that make financial sense, mainly because the federal program requires that one-quarter of the funds help very low-income people. Officials say they can only reach this group by turning foreclosed homes into inexpensive rentals.

In Rhode Island, which has a $19.6 million allocation, officials have found it relatively easy to spend $3 million on downpayment assistance for nearly 80 families and $4 million to purchase very rundown foreclosed properties that will be renovated at a later date.

But they have been slower to spend the $9 million targeted for acquisition and rehab, said Noreen Shawcross, chief of the state’s Office of Housing and Community Development. To complete the renovations, nonprofits need to find financing beyond the stabilization funds. That’s been difficult to do, particularly for housing aimed at the lowest income strata.

“It’s harder to make development work when you are getting lower rents,” said Shawcross.

Not everyone sees the increased competition for foreclosed properties as a problem. This activity will also bring stability to neighborhoods, said Joseph Pigg, senior counsel at the American Bankers Association.

“If the private market is coming back and buying houses and crowding the government out, that’s not a bad thing,” he said.

Acknowledging the program’s implementation is causing “a lot of anxiety,” HUD’s Marquez said the department has allocated $50 million to provide support for struggling localities. It contracted with community development experts to help state and local governments.

“If there is a barrier, how can we help break it or bridge it,” Marquez said.

These support teams should hit the ground in October. Marquez said she would not be surprised if more state and local officials then amend their plans to meet the market realities in their neighborhoods.

State and local governments will also be able to seek help from a new community organization aimed at facilitating the transfer of foreclosed properties from banks, said Ali Solis, senior vice president at Enterprise Community Partners.

Created by Enterprise and other nonprofit groups, the National Community Stabilization Trust is working with several large financial institutions to give governments access to foreclosed homes before they hit the market. The trust has also lined up a $50 million low-interest credit line that officials and nonprofits can use to acquire homes.

Ultimately, the question remains whether the program will meet its goal: to stabilize and revitalize communities plagued by foreclosure. Experts are mixed in their views, with some hopeful that the effort will still do some good in targeted areas and others wondering how much of an impact it will have.

“It’s very unclear when the dust settles how much real change in neighborhood stability and quality of life we’ll see,” said Brookings’ Mallach.