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Cash Incentive Short Sale Programs: The Snyder Group

 

Cash Incentive Short Sale Programs: The Snyder Group

Hello and good afternoon this is Dale and Chris with the Snyder group at Keller Williams Realty here in Las Vegas Nevada. 

 

Dale: Thanks for your time today Chris I appreciate it. 

Chris: Absolutely. 

Dale: Alright so today we are going to just discuss the incentive short sale programs.  Basically guaranteeing a release on the deficiency and getting some cash for complying with the short sale.  We have three basic programs: one is HAFA, two is the DTS and three is just the cash incentive program.  Chris, his main role on the team other than doing everything is overseeing our short sale department as our office manager so Chris is always studying and understanding the different programs and guideline changes in the short sale program which is an ongoing changing system.  Right? 

Chris: Oh absolutely. 

Dale: It’s unbelievable the changes we are seeing.  I mean we’re seeing a huge push towards short sales from the government and the banks so you know it’s a rapidly evolving program.  So let’s jump right in Chris. HAFA, DTS, cash incentive.  You want to just give us a quick overview of those 3 programs and then I’ll jump in and ask a question along the way if I feel there needs to be a little more understanding. 

Chris: Let’s start with the HAFA program for those of you who don’t know what it is.         HAFA Program comes from the government.  The government backed program from the treasury department, where the treasury will actually pay the mortgage owner if the bower qualifies for that program.  Right now it’s at $3000 dollars so those funds come         from the treasury department, pay the mortgage owner back as long as the mortgager deems that buyer qualifies. 

Dale: So basically you are going to get three grand and a full release of the deficiency for the bank to come after you for the difference? 

Chris: Absolutely.  The government if you qualify for that program guarantees that you will get the deficiency waiver for the mortgager. 

Dale: Ok fantastic. 

Chris: The second program is actually just to shorten it up is called DTS, it’s dignified transition solutions and it’s a service that’s hired by Bank of America currently.  As of a couple weeks ago DTS informed us that they could possibly be merging in more to Wells Fargo and Chase. 

Dale: Yeah I know it was a pilot program that started with Bank of America since they control a majority of the mortgages in the country and this came out maybe nine months ago as a pilot program in Nevada, Florida, Arizona, California some of the hardest hit foreclosure areas in the country and it’s been very successful so they’re expanding it sounds like potentially with other banks. 

Chris: Yeah absolutely and the greatest thing about the DTS program is that it’s a smaller company that’s handling a smaller amount of loans so responses are quicker, information is more accurate and eventually you don’t need document collection which is submitting all your financials and months of bank statements and pay stubs and tax returns. 

Dale: It’s an ongoing process with DTS you do not have to supply any paperwork at all which helps expedite it as well right?  Because otherwise it’s like well now we need an updated pay stub, an updated checking account statement all through this process. 

Chris; Absolutely. So for right now if you’re loan is with Bank of America and you decide to short sale we submit that stuff to DTS and they will decide whether or not you qualify for that program such as not needing those documents. Once we receive an offer we go straight into the negotiation process. 

Dale: Fantastic. What’s this incentive one?  I know one of our clients he got a check for 20 grand to short sale his house. 

Chris: Yeah the incentive program works through some of the larger mortgagers such as Bank of America, Wells Fargo, and Chase. I got done recently with someone with Chase got up to $30,000 dollars to do a short sale.  He was marketed directly for that.  He was chosen by the mortgage owner.  There is no way for us to submit and see if you qualify.  What they are doing is seeing that there are properties that are in their best interest to short sale and marketing directly to those people stating hey we’ll give you that cash incentive if you decide to short sale. 

Dale: And there’s got to be stuff going on in the back end right?  I mean there’s got to be some sort of government involvement or incentives on the back end or there is some sort of potential liability.  Or I don’t know what it is but there’s got to be something on the back end going on for them to cherry pick homeowners and say hey here’s 20 grand do a short sale. 

Chris: Absolutely. 

Dale: It’s amazing I can’t believe it’s actually happening. 

Chris: Yeah, I mean it’s one of the crazier programs that’s for sure and a lot of it goes through the investors cause as we know with these programs there’s a couple different people involved which is another reason why the short sales take so long for getting communication from all parties. 

Dale: Yeah that’s a whole video or set down conversation over happy hour to go over the servicers, investors and that whole shenanigans. 

Chris: Absolutely but people who are chosen for this incentive program eventually come from that investor who wants to liquidate a certain bundle of properties.  So they are willing to incentivize that. 

Dale: Alright well you know thanks for this information Chris it’s valuable and you know obviously as a consumer you know you may  have further questions.  Feel free to reach out to Chris or I we’d be more than happy to have a free and informative conversation with you on the phone. I hope you have a fantastic day.  Once again this is Dale and Chris with the Snyder group at Keller Williams Realty talking about the cash incentivized short sale programs that are out there.  Have a great day.

Many banks are offering homeowners cash incentives to short sell thru special programs. This benefits both the homeowners and the bank, as there is no foreclosure. To find out if you qualify for the different programs or to find out what other options are available, please feel free to reach out to us.

Short Sale Process Changes: The Snyder Group

 

Short Sale Process Changes: The Snyder Group

 

Good afternoon this is Dale Snyder with the Snyder group of Keller Williams Realty here in Las Vegas Nevada. We have Christopher Hahn our office manager and short sale negotiator overseeing the processes for the team. 

Dale: Thanks for your time today Chris and being here.

Chris: Of Course

Dale:  What we would like to go over today is going to be the short sale process changes.  So whether you are a agent that is new to short sales and you are trying to understand this complicated and ever changing process or you are a consumer that is thinking about short selling or you are already in the process.  There have been a lot of recent changes and Chris is the expert on the processing side of things.  He is always taking classes staying up on top of all of these changes so we can make sure our short sales moves smoothly.  So I guess lets jump right in Chris.  What do we got going with changes? 

Chris: I guess the most relevant and recent change would actually be with the department of justice.   They have recently settled with some of the larger mortgage holders as of June 15th to better regulate how long it takes those mortgagers to respond to offers.  Now they have 30 days to respond to an offer they deal with slightly longer period of 60 days                   if there is a PMI, which is principle mortgage insurance, or have a program involved which is a little longer process. They have also regulated the deficiency guidelines on seconds.  Before it was very difficult to get a deficiency waver on the second due to it being a HELOC.  If someone pulled cash out their home and invest it into cars and vacations or whatnot and the mortgage holders were less lenient on issuing those deficiencies wavers.  Well that has been reigned in as of June 15th.                

Dale: Ok, I have a question.  I am assuming you have may have this same question.   So they have 30 days to say yeah I got your offer or do they have 30 days to counter offer?  Or what do you mean they have 30 days more specifically? 

Chris: When they get an offer there are 3 things they can do with it.  They can accept it, counter it, or reject it.  They are getting to it within 30 days as long as our side of it, the agents side of it is staying up to date with those tasks.  They are being much more regulatory on how long it takes us to respond to certain requests.  They say that we have to respond to their response within 5 days. That allows them to stay within that 30 day period.  So if we don’t give them what they want quick enough, whether it’s getting it from the consumer or getting it from a third party, they will just end up rejecting the offer instead of moving forward or simply letting us know that the reason they can’t write an offer is due to us not responding and that puts them into that 60 day period. 

Dale: Ok so I have a question then.  If we comply and give them everything that they need within this 30 day period the department of justice will either have to counter offer or accept that offer within 30 days if we comply with providing everything they need within that time window? 

Chris: Absolutely. Obviously, the department of justice can’t regulate every single file down to the mortgage holder but as real estate agents knowing this we can simply provide them with everything they need and state we’ve given you everything as per             the department of justice starting June 15th you have to respond to our offer within that 15 days. It’s a little bit of leverage that we can use when negotiating. 

Dale: Oh wow. That’s really a fantastic change.  I mean, I remember 4 years ago when I started doing short sales the first one was such a nightmare.  I think it took 8 months for BofA just to say no to me.  Like they didn’t even say why.  They just rejected the short sale and they said well the BPO came in at 780 and your offer is 750 and they just rejected it and closed out the file.  Eight months to get that answer.  So that’s a monumental change in the short sale process so that’s great news. 

Chris: Yeah and like I said it was just June 15th , before it was mortgagers had to respond within a reasonable time.  Well what’s a reasonable time when you’re forgiving a deficiency? 

Dale: Ok well let’s move on.  If you would like to talk more about that feel free to reach out to Chris or I would be more than happy to discuss that.   So what else?  I hear there is like some negotiator task changes or escalation department.  Well what else do we have going on that’s news? 

Chris: Another large item that is from Bank of America that has actually changed their Equator process which is a pretty big deal.  They have to retrain their departments to follow these new guidelines.  As of before you could initiate a short sale which was simply submitting a third party authorization which was giving us the right to speak to the bank on the borrowers behalf.  Then we had to wait until we had an offer and then once we had an offer we had to wait for document collection to finish to order the BPO.  Therefore it’s expanding that timeline from 30 to 60, 90, 120 days.      

Dale: 5 months, 10 months really that’s why short sales have a bad reputation right? 

Chris: Absolutely. So what the new system allows is for those tasks to be initiated at the same time.  They put in a short sale and it gives them the right to order that evaluation with document collection status as well as wait for an offer all at the same time.   So these tasks can be completed within 30 days and the bank gives a response. 

Dale: Wow,  so it’s not if I’m hearing you right what I remember when I was processing these short sales it’s like ok now upload this document.  Ok we will let you know we have it within 2-4 business days.  Now upload this document we will let you know in 2-4 business days.  So next thing you know it’s 45 days and we’ve really done nothing more in the short sale process. 

Chris: Right. 

Dale: I mean that’s not the best verbiage.  We haven’t gotten anywhere in the process but it has taken us like a month just to get all the documentation in.  Where now you’re saying this can be going simultaneously so it will shorten that window drastically.  Is that what I am hearing? 

Chris: Absolutely.  Document collections status is half of the short sale process because those documents come back and forth a lot.  There is another person on the other side of this short sale, as in the negotiator with Bank of America or processor that wants documents exactly the way that they want them.  That changes for the person you’ve used to the next.  So sending those documents back and forth is pretty much just a long process.  What is allowed now is other items to be going on all at the same time.  Not submitting a document waiting for them to review it and send it back for us to correct it and so on and so forth with the hundreds of documents that we have to fill out, complete and submit. 

Dale: Yeah excellent.  Well these are some drastic changes and it is a great thing for us as agents and you as the consumer to really streamline this approach.  So just in summary you know when we are talking about this document collection we are referring to the equator system. And the equator system is basically the portal if you will that we communicate back and forth with to bank of America, Wells Fargo, what other lending institutions use equator? 

Chris: GMAC uses the equator system.  You have to submit your package and they will initiate it from their side but they do use it which is great.  There is also some other small ones   Blackstar, Nationstar I believe is one of them.  What’s really great is just 2 weeks ago the VP of Chase announced that they will be using the equator by the end of the summer which is fantastic.  They are still in the fax era, where we have to fax in our documents, call them to make sure they got them, tell us their fax machine is not working for the billionth time.  

Dale: And we are sending them 70 pages at once. 

Chris: We will call and say did you get page 3, did you get page 4, page 5.

Dale: It’s ridiculous. What about IndyMac, is IndyMac one we are having some challenges with right now? They don’t use the equator system?

Chris: No they don’t.

Dale: They don’t even have a short sale department, right?

Chris: That is correct. Some of the smaller mortgage holders simply don’t have a high majority enough of short sales to create a department yet. 

Dale: I have a feeling they are going to have to because there is this huge push to short sales rather than foreclosing.  So they are all going to have to develop some sort of department. 

Chris: Some sort of system.  Right now it’s you know I’m loan processor that’s doing the same equity and VA loans and also having to deal with short sales. 

Dale: Oh it’s Metlife, I wasn’t thinking, its not IndyMac, that took us some time to get in touch with somebody.

Chris: Metlife is another one, IndyMac was the same thing. It’s not really a huge volume that they have and Metlife is not one of the greatest.  We are going back to the Bank of America old days where we submit a document and we call in for a week and they still won’t confirm that they got it.  In this department or that department or this is the person you have to talk to. 

Dale: We can get it done just you know you got to be patient with this.   The most important thing I guess, in summery because I don’t want this video to turn into a 30 minute episode but in summary with everything it really depends on the lender we are dealing with but there are a lot of guideline changes so if you reach out to Chris or I you know we would be more than happy to give you a free consultation going over this information with you.  Do you have anything to add in closing Chris? 

Chris: No I don’t.  Thank you very much for having me. 

Dale: You bet.  Thank you for your time.  And once again it’s Dale and Chris with the Snyder group of Keller Williams Realty here in Las Vegas talking about the short sale process changes.  Have a great day.  

If you or someone you know owes more on a property than it is worth and your unsure of the options available, please feel free to reach out to us.
 

Las Vegas Luxury Real Estate Market June 2012 Update: The Snyder Group

 

Las Vegas Luxury Real Estate Market June 2012 Update: The Snyder Group

 

 

Good afternoon, this is Dale Snyder with the Snyder Group in Keller Williams Reality here in Las Vegas Nevada giving you a luxury market update for the valley. We’ve broken it into two different categories, one is going to be the one million dollar and above, and the 500,000 and 999,000. I chose to break it down to two different categories due to the fact that a lot of our semi-custom and even our custom homes are even as cheap as 500,000 in the valley now.

So lets jump right into the data and then I give a quick summary, but for a in depth very informative conversation please feel free to reach out to me because it is really going to depend upon on which area of the city specifically and then the price range you are in. Let me just prefaces this by saying that when you get into the custom section of the market it kind of frustrates me some times when people are trying to give me a price per foot breakdown because it really depends. You know, pocket doors, there are a lot of things that are going to make the price per square foot go up, as much as a $100 per square foot with the arch roofs. So it is really hard to give a breakdown of just price per foot to get a real pulse on your specific criteria.

So we are going to use that for today’s data analysis just because we have to have some sort of bearing or some sort of data too go off of just to get a general overview of the valley. So we are going to include Henderson and also all of Las Vegas, North Las Vegas, and the entire valley for this analysis. So let’s jump right in.

So let’s start with the one million and above price range. You can see that we have about 280 properties on the market for sale, 58 currently in contract, 13 that have sold in the past 30 days and 36 have sold through the second quarter as of yesterday. We have about another week left before we finish out the quarter.

If you assume that the 58 in contract are going to close, which obviously some of those are going to fall out. But just this conversation at least lets assume that those are not currently still on the market. That leaves us with about a 21.5 month supply of inventory in the one million or above price range.

So the lower end of the market if you break it by quartet, which we are going to have a graph at the bottom of this blog which you are going to be able to see that the bottom 25 %, the lower middle 25%, and the upper middle 25% is a sellers market right now. Its when you get to that upper 25% of the market that its still a very strong buyers market just due to the, I don’t want to say an excessive amount of inventory, but we do have a pretty high amount of inventory at this moment.

Out of the homes on the market 13 of them are short sales and only two are bank owned, which shouldn’t come as a surprise to any of you the banks are choosing not to foreclose, and with not choosing to foreclose the people who are looking at potentially short selling, their urgency has gone down knowing that the banks are not going to be foreclosing on them. So this doesn’t surprise me at all with these numbers.

With the properties in contract 25 are in short sales and four are bank owned, so a big jump up in that which shouldn’t surprise you either a vast majority of the properties in the luxury sector are overpriced to be real with you. There is a reason why they are sitting on the market one year, two years, and three years. If they were priced in alignment with where the distressed properties are selling, and when I say distressed I am referring to normal sales as well you know there are people who need to sell their properties so they are having to price more in alignment with where the distressed sales are to move those properties.

Let’s move over to the solds, you can see two short sales and four bank owned properties that have sold so far in the second quarter which actually surprised me, I figured that number was going to be higher but there were quite a few non-distressed sales that sold so far in the second quarter.

Let’s look real quickly at the averages. The average price for the properties for sale above a million is 2.8 million dollars at $352 a foot. We’ve got the high of the sale list price at 25 million. We have 32 properties above 5 million dollars on the market currently.

Let’s move over to the pendings. The average list price for the homes in contract is 2.2 million with a $268 per square foot, 205 days on the market. When we move over to the solds the average sale price is $254 per square foot, which we are seeing 91% of the list price is the sales price. So if you look at $268 a foot, the average sale price of $254 a foot, and then you look over here the average list price of $352 a foot, I mean there is no wonder why we have 280 properties on the market with a 21.5 month supply when you are just looking at these price per foot average variances.

But keep in mind you cant really put all these custom homes in this price per foot box, but for data analysis I think it is a fair assumption to do that to give us numbers to look at.

Alright, let’s quickly go ahead and move on to the $500,000 to the $999,000 price range. We have a 5.4 month supply. This market is hot. You know we are seeing a lot of activity. If you priced your property right in this range you are probably going to get multiple offers within a couple of weeks.

So 319 currently on the market, a 188 in contract, 59 sold in the last 30 days, 153 sold in the second quarter. Of what is on the market 47 are distressed either short sales or bank owned with an average price per foot of $182.

Going into the contract we have 119 of these properties that are short sales or bank owned. So a lot of these are going to be falling in and out of escrow, so this supply of inventory is skewed a bit because when you have 100 short sales in escrow, unfortunately there is going to be a lot of fall outs over the next 12 years,  just kidding, over the next several months.

$170 a foot is the average of the properties in escrow. Moving over to the sold we have about 52 distressed that have sold in the second quarter with an average of $164 per foot. So if you look at the market $182 per foot, in contract $170 per foot, in sold price $164 per foot. Homes are selling at about 95 % of the list price right now in this price range and it doesn’t matter if it is a short sale, a bank owned, or a normal sale the numbers are about the same.

So, in summary, we are seeing a drastic shift or change in our market place right now, but it’s not so much in the luxury sector. You know a million and above we are seeing multiple offers but you really have to have a unique product, and days on market we are seeing an average of 150 to 180 days on market.

When you get to the end of this 500 to one million price range it’s a completely different animal. There are a large amount of buyers in this area, and the properties there is much less supply to choose from.

Hope this information was of value. Oh, I forgot to tell you. Of the sales, there were five sales in the second quarter there were five that were above two million dollars. We had two that were in Southern Highlands, one in Red Rock Country Club, one in the Ridges, and the high sales point was 5.6 million and the Estates in Southern Highlands, but those were the highest sales that we have seen in the second quarter.

Once again this is Dale Snyder with the Snyder Group in Keller Williams Reality. Hope this information was valuable. Reach out to me if you would like to have an educated conversation on the luxury market. Have a great day. To have an informative and educated conversation about the Las Vegas Nevada luxury market, feel free to reach out to us.
 

 

 

 

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