Short Sale Madness

Many investors today are chasing the ‘short sale’ as a viable preforeclosure strategy. However, they are finding that the short-sale is really a long sale.

The one thing to remember about short sales is that you may be able to short the mortgage on the home but you’ll have to be long in patience! With the advent of the government encouraged loan modification process, the short sale process has become even more cumbersome.

If you have a short sale strategy, you should have other strategies also. Many times short sales offers never get accepted because lenders are overwhelmed and do not have the staff or decision making powers to move the transaction to acceptance.

If you are entering into a short sale negotiation with a bank you should have the ability to close quickly and have the willingness to wait blindly. Patience is usually the key to success in these situations.

What you need is viable strategies…

Steps to Success

With the government encouraging banks to modify loans and keep homeowners in their homes, short sales are becoming tougher. To succeed you’ll need to modify your strategies.

First remember that you’ll have to work within the system and that will be frustrating. Your tactic may require you be flexible. One tactic that many investors are employing is a total investment of time.

This means they inform the Realtor and the lender that should a short sale not work out, they are willing to wait through the foreclosure process and continue the negotiation process once the property comes out of foreclosure.

Another tactic is multiple offers. Some experts suggest putting a 48 hour limit on acceptance of the contract. This way they can make several offers in a very short period of time without being committed to closing on all of them.

In this way the investor can continue to take advantage of every opportunity. Since very few short sale transactions actually end a successful contract, having the ability to negotiate several contracts at a time is critically important.

Finally, to create the most success some savvy investors have started to employ short sale experts. This can be tricky because there are many people who claim to be short sale experts but few really are.

Make sure your short sale expert is a professional. Check references; make sure they have the necessary skill sets. Many experts recommend only using attorneys or qualified real estate agents.

Avoid anyone who just took a course on the subject and no real estate experience. To be successful you’ll need real professionals that understand the law and understand how to speak to attorneys.

The bottom line is this, in these days and times when bank REO departments are overwhelmed and the government is exerted more and more regulation over bank policies invests will need more than a short sale strategy to score great deals!

Michael Gross is the President of Dividend America Mortgage and has been in real estate for over 20 years. He has been a builder, a Realtor, an appraiser, and currently he is a lender and an active real estate investor. He uses all of his experience and knowledge to show individuals how to properly use a mortgage as a tool to help create greater wealth through real estate investing. For more information on residential and small commercial loans please call 770-350-7373 or email mgross@dividendamerica.com

5 Reasons To Buy NOW

Recently I read a great article on MarketWatch written by Amy Hoak. http://tinyurl.com/dx9wjb She believes that the signs are right and buying now may be a very smart decision.

The reason that a lot of people are choosing not to buy right now is because of all bad news in the media. However, it is exactly times like that the people need to break away from the pack and buck the trend.

Warren Buffet says that when markets are greedy he is cautious but when markets are cautious, he is greedy! In a nut shell, the housing market is very cautious right now, you should be greedy.

Amy’s article goes on to point out 5 reasons why you should buy a home right now!

1. Affordability – Home prices are now at 1999 levels! That’s a huge discount and since the profit I real estate is generally made when you buy, now is the time.

2. Large Inventory – There are many homes to choose from, pick the one you want and name your price! More than likely, it’ll be yours.

3. Builders Discounts – Builders have finally figured it out. Shedding the dead weight is the only way to get cash flowing and business moving again. And their giving huge discounts to move those empty houses.

4. Low Interest Rates – Interest rates on residential mortgages haven’t been this low since the early 50’s! If you miss this move, it will likely be another 5+ decades before you see them this low again.

5. Federal Tax Credit – While this doesn’t affect investors directly, it can in the future. The last time we had a housing slump it was this exact credit that helped pull the country out of it.

The bottom line is that now is a good time to buy. Using a buy and hold strategy could mean huge windfalls when the economy turns around so get out there and make some offers. Now is the time!

Roller Coasters and The Ride

http://strategysessions.blogspot.com/

Remember those really great roller coaster rides you experienced as a child? After zooming around several twist and turns and being jerked from side to side, your cart would slow as it approached the really large hill.

You hear the chu-chunk of the hook as it locks onto your cart and then you experience a slight jerk as you are pulled reluctantly forward. Clink-clank, clink-clank; you here the ‘song of the chains’ as they grown to pull the weight.

It’s just the carts, you and 50 others behind you, anxiously awaiting what comes next. The exhilaration, the anxiety …your breathing is no longer rhythmic but comes in big gulps of air and wind. Sweat on your temple as you near the top!

You can’t see over the edge, you feel as if you are dangling in space with nothing but this flimsy bar strapped across your thigh. You notice a loose bolt and the bar jiggles. You think, oh my, that’s not good!

Suspended in time, animated at the top, you wait. And then it happens. You roll over the precipice and you are staring straight down! Sky above and earth below! God I hope this thing has breaks or a parachute is the only thought rushing through your head!

Before you know it your flying, heart racing, down, down, and down, faster and faster! Everyone’s screaming bloody terror, a few fools have their hands in the air, you hang on to the bar for dear life praying that the loose bolt doesn’t unscrew any further!

Then you are at the bottom! Whew, everything levels out. You are still moving faster than the speed of light and you are still being jerked from side to side but you know the ‘ride’ is almost over! There is hope! Whew!

That’s how I felt the first time I ever rode the Scream Machine at Six Flags Over Georgia. I’m sure everyone has experienced their own Scream Machine in their own town and hopefully my description evoked the same sensational memories I have.

I give you this experience as an example of what has happened in the real estate industry. We’ve heard the cha-chunk, we’ve experienced the ringing clink-clank and we’ve endured the precipitous fall to our inevitable doom!

But now we are in the jerky part of the ride. It’s still a little scary, we have some more hills to climb and fall from and we have a few more harrowing hair pin turns to endure, but the end is near.

If you are an investor you should be prepared. Get ready so that when the cart pulls into the station you can hit the ground running. There are new rules and if you can figure out what they are and prepare yourself to operate in the new environment the opportunity will abound.

Stay tuned for what the new rules are, changes are coming fast and furious again. But this time it will be for the good.

Michael Gross is the President of Dividend America Mortgage and has been in real estate for over 20 years. He has been a builder, a Realtor, an appraiser, and currently he is a lender and an active real estate investor. He uses all of his experience and knowledge to show individuals how to properly use a mortgage as a tool to help create greater wealth through real estate investing. For more information on residential and small commercial loans please call 770-350-7373 or email mgross@dividendamerica.com