From the category archives:

Short Sale vs Foreclosure

The INSIDE SCOOP on Short Sales-Tampa Bay Statistics, How a Short Sale Works and more..

by Rae Catanese on January 26, 2010

in Selling Home as Short Sale, Short Sales Tampa

This is one of the BEST examples of how a short sale works that I’ve read in a long time. If you haven’t read up on exactly how the process works this is a great place to start for both buyers, and anyone considering hiring a listing agent to sell their home. All Realtor’s predictions are suggesting that selling Real Estate in Tampa Bay as a Short Sale is here to stay.

Inventory Statistics for Tampa Bay short sales versus regular sales as of January 2010 are as follows:

Hillsborough County (Tampa)

Current active inventory of 9,663 properties for sale.

A little over 35% are listed as short sales.

Pinellas County (St. Pete, Clearwater area)

Current active inventory of 11,942 properties for sale.

A little over 19% are short sales.

The Complete Short Sale Process

How a Short Sale is Handled from Listing to Bank Approval

By Elizabeth Weintraub, About.com Guide

The short sale process follows pretty much the same procedure from bank to bank.

The short sale process is still a mystery to many people, even after all these years. Lots of buyer’s agents are confused; puzzled buyers are looking for direction, and not every short sale listing agent knows how to do a short sale^.

The Basics of a Short Sale

Banks grant short sales for 2 reasons: the seller has a hardship, and the seller owes more on the mortgage than the home is worth.

A few examples of a hardship are:

Unemployment / reduced income
Divorce
Medical emergency
Job transfer out of town
Bankruptcy
Death

The seller will need to prepare a financial package for submission to the short sale bank. Each bank has its own guidelines but — with the exception of Wachovia, which is the best short sale bank in the world — the basic procedure is similar from bank to bank. The seller’s short sale package will most likely consist of:

Letter of authorization, which lets your agent speak to the bank.
HUD-1 or preliminary net sheet
Completed financial statement
Seller’s hardship letter
2 years of tax returns
2 years of W-2s
Recent payroll stubs
Last 2 months of bank statements
Comparative market analysis or list of recent comparable sales

Writing the Short Sale Offer and Submitting to the Bank

Before a buyer writes a short sale offer, a buyer should ask his or her agent for a list of comparable sales. Banks are not in the business of giving away a home at rock-bottom pricing. The bank will want to receive somewhat close to market value. The short sale price may have little bearing on market value and may, in fact, be priced below the comparable sales to encourage multiple offers.

After the seller accepts the offer, the listing agent will send the following items to the bank:

Listing agreement
Executed purchase offer
Buyer’s preapproval letter and copy of earnest money check
Seller’s short sale package

If the package is incomplete, the short sale process will be delayed. In this event, the bank might even shred the package.

The Short Sale Process at the Bank

Buyers may wait a very long time to get a response from the bank. It is imperative for the listing agent to regularly call the bank and keep careful notes of the short sale process. Buyers may get so tired of waiting for short sale approval that they may feel the need to threaten to cancel if they don’t get an answer within a specified time period.

That type of attitude is self-defeating and will not speed up the short sale process. If buyers are the type with little patience, perhaps a short sale is not for them.

Following is a typical short sale process at the bank:

Bank acknowledges receipt of the file. This can take 10 days to a month.
A negotiator is assigned. This can take 30 to 60 days.
A BPO (broker price opinion) less formal than an appraisal, is ordered. The bank probably will refuse to share the results of the BPO.
A second negotiator may be assigned. This can take another 30 days.
The file is sent for review or to the PSA. This can take 2 weeks to 30 days.
The bank may then request that all parties sign an Arm’s-Length Affidavit.
The bank issues a short sale approval letter.
The buyer cancels.

I threw in that last line because sometimes I have to sell my Sacramento short sales 3 or 4 times before a buyer sticks with the transaction. Buyers get angry and annoyed because the short sale process can be so lengthy that they sometimes cancel without telling anybody. Some short sales get approval in 6 to 8 weeks. Others take 90 to 120 days, on average.

Tip: Generally the listing agent has some idea of when the file is sent for final review. At that point, buyers may want to start the loan process so they’ve got a head start in case the bank gives 2 weeks to close.

If you need help buying or selling your home as a short sale please contact me. Rae Catanese, PA-Prudential Tropical Realty-

813 784 7744 or Email

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What you NEED to know about Selling your Home as a Short Sale-Tampa, Fl

by Rae Catanese on December 12, 2009

in Selling Home as Short Sale, Short Sale vs Foreclosure

Short Sales Tips for Sellers in the Tampa Real Estate Market

If you’re thinking of selling your home, and you expect that the total amount you owe on your mortgage will be greater than the selling price of your home, you may be facing a short sale. A short sale is one where the net proceeds from the sale won’t cover your total mortgage obligation and closing costs, and you don’t have other sources of money to cover the deficiency. A short sale is different from a foreclosure, which is when your lender takes title of your home through a lengthy legal process and then sells it.

Selling a Short Sale Tampa

1. Consider loan modification first. If you are thinking of selling your home because of financial difficulties and you anticipate a short sale, first contact your lender to see if it has any programs to help you stay in your home. Your lender may agree to a modification such as: Refinancing your loan at a lower interest rate; providing a different payment plan to help you get caught up; or providing a forbearance period if your situation is temporary. When a loan modification still isn’t enough to relieve your financial problems, a short sale could be your best option if:

Your property is worth less than the total mortgage you owe on it.
You have a financial hardship, such as a job loss or major medical bills.
You have contacted your lender and it is willing to entertain a short sale.

2. Hire a qualified team. The first step to a short sale is to hire a qualified real estate professional and a real estate attorney who specialize in short sales. Interview at least three candidates for each and look for prior short-sale experience. Short sales have proliferated only in the last few years, so it may be hard to find practitioners who have closed a lot of short sales. You want to work with those who demonstrate a thorough working knowledge of the short-sale process and who won’t try to take advantage of your situation or pressure you to do something that isn’t in your best interest. A qualified real estate professional can:

Provide you with a comparative market analysis (CMA) or broker price opinion (BPO).
Help you set an appropriate listing price for your home, market the home, and get it sold.
Put special language in the MLS that indicates your home is a short sale and that lender approval is needed (all MLSs permit, and some now require, that the short-sale status be disclosed to potential buyers).
Ease the process of working with your lender or lenders.
Negotiate the contract with the buyers.
Help you put together the short-sale package to send to your lender (or lenders, if you have more than one mortgage) for approval. You can’t sell your home without your lender and any other lien holders agreeing to the sale and releasing the lien so that the buyers can get clear title.

3. Begin gathering documentation before any offers come in. Your lender will give you a list of documents it requires to consider a short sale. The short-sale “package” that accompanies any offer typically must include:

A hardship letter detailing your financial situation and why you need the short sale
A copy of the purchase contract and listing agreement
Proof of your income and assets
Copies of your federal income tax returns for the past two years

4. Prepare buyers for a lengthy waiting period. Even if you’re well organized and have all the documents in place, be prepared for a long process. Waiting for your lender’s review of the short-sale package can take several weeks to months. Some experts say:

If you have only one mortgage, the review can take about two months.
With a first and second mortgage with the same lender, the review can take about three months.
With two or more mortgages with different lenders, it can take four months or longer.

When the bank does respond, it can approve the short sale, make a counteroffer, or deny the short sale. The last two actions can lengthen the process or put you back at square one. (Your real estate attorney and real estate professional, with your authorization, can work your lender’s loss mitigation department on your behalf to prepare the proper documentation and speed the process along.)

5. Don’t expect a short sale to solve your financial problems. Even if your lender does approve the short sale, it may not be the end of all your financial woes. Here are some things to keep in mind:

You may be asked by your lender to sign a promissory note agreeing to pay back the amount of your loan not paid off by the short sale. If your financial hardship is permanent and you can’t pay back the balance, talk with your real estate attorney about your options.
Any amount of your mortgage that is forgiven by your lender is typically considered income, and you may have to pay taxes on that amount. Under a temporary measure passed in 2007, the Mortgage Forgiveness Debt Relief Act and Debt Cancellation Act, homeowners can exclude debt forgiveness on their federal tax returns from income for loans discharged in calendar years 2007 through 2012. Be sure to consult your real estate attorney and your accountant to see whether you qualify.
Having a portion of your debt forgiven may have an adverse effect on your credit score. However, a short sale will impact your credit score less than foreclosure and bankruptcy.

If you are thinking of selling your home as a short sale, please contact me:

Rae Catanese, Pa 813 784 7744

Prudential Tropical Realty

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Foreclosure SCAMS being revealed-Pinellas County helps home owners

by Rae Catanese on November 19, 2009

in Foreclosures Tampa, Selling Your Home, Short Sale vs Foreclosure

Radio show features consumer scams and foreclosure prevention
This month’s show features the latest consumer scams and foreclosure prevention tips. Guests are Deborah Berry, Operations Manager Pinellas County Consumer Protection and Bill Sanchez, Vice President of the Homebuyers Club from Tampa Bay Community Development Corporation.

The program, sponsored by the Housing Finance Authority, airs the first Thursday of each month from 10:00 to 10:30 a.m. on WRXB 1590 AM. If you miss a show, listen at your leisure on-line at HFA Radio Shows. You can also watch on Pinellas County Connection TV — There’s No Place Like Home. If you have a question you’d like us to answer, please call 813 784 7744.

A short sale is also something you may want to consider before you go the route of foreclosing on your property. Here are several articles I wrote on short sales and what you need to know.

Need Advice? Thinking of listing your home for sale in Tampa Bay? Contact your local Realtor. Rae Catanese

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Tampa Short Sales makes frontdoor.com top ten Real Estate Nightmares List

by Rae Catanese on October 6, 2009

in Short Sales Tampa

Top Real Estate Nightmares

My article for HGTV’s frontdoor.com, Top Ten Real Estate Nightmares, came in at #7 on the top ten list!!

Thanks to my buyers who helped contribute to this article.

Learn how you can avoid these hair-raising real estate horrors

By Shannon Petrie, FrontDoor.com | Published: 9/24/2009

Buying a short sale? Be prepared for plenty of obstacles between you and your home.

Nightmare #7: Scary short sale buyingDon’t let the name fool you: buying a short sale can be a long, tedious process. Just ask Rae Catanese, an agent with Prudential Tropical Realty in Tampa, Fla., who is representing three short sale buyers. After being under contract for four months, one of the sales is finally closing — maybe.

After taking nearly three months to approve the sale, the bank then took another two weeks to determine that the buyers only had 30 days to close. If the buyers couldn’t close in 30 days, they would be assessed a $1,350 fee and a to-be-determined per diem penalty. “Any mortgage person can tell you that getting a loan to close in 30 days is going to be difficult,” Catanese says. “This is especially true for those that are using FHA financing, which is now taking 45 days.”

Fortunately, Catanese and her buyers were able to convince the bank to give them 30 days to close without the penalties. But the problems didn’t end there. After the lender took nearly two weeks to set up an FHA account and schedule an appraiser, the buyers decided to change lenders, fearing that their bank would not be able to close and they would lose the home. Two days before close, everything seemed to be going smoothly, until Catanese found out that the sellers had received a notice of foreclosure. For the buyers, this means they have until the end of the month — or eight business days — to close on the home before they lose it for good.

TIP: Even under the best circumstances, short sales take a long time to close and may take extra effort from the buyer. If you want to buy a short sale, be sure you have plenty of patience and an agent who has experience with the process.

If you need help buying or selling a short sale home, please give me a call 813 784 7744 or email: realtyrae@yahoo.com Rae Catanese, Real Estate Agent

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Hiring an attorney to represent you in a SHORT SALE?

by Rae Catanese on July 2, 2009

in Foreclosures and Bank Owned, Selling Home as Short Sale, Selling Your Home, Short Sale vs Foreclosure, Short Sales Tampa, Tampa Real Estate Market News & Updates, Tampa Realtors

Selling your home in the Tampa Real Estate Market is no easy task. Clearly, negotiating a successful short sale is even more difficult. It will require countless hours of phone time and inevitable frustration. It is highly recommended that you enlist the services of a professional to perform negotiations on your behalf.

As a Realtor with Prudential Tropical Realty here in Tampa Bay, I’m excited to announce that our real estate agency has decided to hire a law firm to handle the short sale and foreclosure process for our clients. If you are thinking about hiring a listing agent to list your home for sale, and would like representation please call me to discuss your options….813 784 7744

Prudential Tropical Realty turns to Yesner & Boss for legal help

Tampa Bay Business Journal

With short sales and foreclosures making home buying a bit tricky, 15 Tampa Bay offices of Prudential Tropical Realty have signed an agreement with law firm Yesner & Boss to represent clients of the real estate agency.

Financial terms were not disclosed.

The St. Petersburg real estate and bankruptcy law firm will provide corporate counsel for Prudential Tropical offices all over theTampa Bay region including St. Petersburg, Temple Terrace, Brandon and the Pinellas beaches, according to a release. Realtors will refer clients to the firm who need help with foreclosure defense, short-sale negotiations, asset protection and consumer protection.

“The goal of Yesner & Boss and Prudential Tropical is the same, to help property owners sat in their homes and work their way out of mortgage difficulties to which the current market is subjecting a lot of people,” said Christopher Boss, a partner with Yesner & Boss, in a release.

There are nearly 60,000 homes in foreclosure in Florida,according to Yesner & Boss, and the Tampa Bay region is one of the mostly heavily beset by foreclosures and short sales.

“While there are signs of life flickering in the residential real estate market, it is a long way from flourishing,” Boss said. “And improvement will not be significant until foreclosures return to normal numbers and the backlog of foreclosed properties is cleared. There is, unfortunately, still a lot of work to be done out there.”

Prudential Tropical Realty first opened 50 years ago and now has offices in Pinellas, Hillsborough, Pasco and Hernando counties.

Yesner & Boss was founded in 2004, according to the firm’s Web site, and specializes in real estate, foreclosure defense, bankruptcy, evictions, and corporate planning and probate.

Get in touch with a Real Estate Agent at Prudential Tropical Realty for help listing or buying your distressed home anywhere in the Tampa Bay area.

Rae Catanese, Realtor

Phone number: 813 784 7744 Emailto: realtyrae@yahoo.com

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Short Sale questions answered-Tampa, Fl

by Rae Catanese on June 10, 2009

in First Time Home Buyers, First Time Home Buying Advice, Short Sales Tampa, Tampa Real Estate Market News & Updates

What is a short sale?

A short sale occurs when a property is sold and the lender agrees to accept a discounted payoff, meaning the lender will release the lien that is secured to the property upon receipt of less money than is actually owed.

Right now in Tampa one half of all homes on the market are a distressed sale. In my experience as a Realtor, I believe that there are more short sale listings than foreclosed properties/bank owned. This makes actually buying a home a tedious process for many home buyers.

Things to consider when purchasing a short sale:

Take into consideration that the 8,000 tax credit expires at the end of the year. That being said, a contract would need to be written by October, just to give the buyer’s lender enough time to close.

If it takes up to 60-90 days to hear from the bank whether or not they have accepted your offer, technically an offer would need to be presented to the bank by August. If you think you have time to wait before you start looking you may want to reconsider!

I’ve been working with a client of mine writing offers on short sale condos. She had some questions which I thought would be helpful for the buyers out there who are considering purchasing a short sale.

How do you feel about writing a contract on the short sales?

It’s more about how you feel and the waiting game. If it’s not bank approved, it could take up to 60-90 days to hear back from the bank to respond to your offer. It will not be a contract until the bank signs it, even though the seller will sign it. It is subject to 3rd party approval.

If an offer has been submitted on a short sale, does it mean the property is off the market? No, not necessarily. It depends on the seller, seller’s agent and what type of contingency you put in your offer. For instance, if you want to continue to look at other properties while you are waiting to hear back from the bank, the seller/agent will want to keep the property on the market. In that case, they will be able to receive other offers to submit to the bank. This may cause a bidding war!

If the 1st contract is denied, would the 2nd offer automatically be presented at that time or would it have been rejected at first offering? If two offers were presented to the bank at the same time, usually they will look at both and pick one.

How do you feel about writing an offer on more than one short sale?

That’s difficult because you have to put a stipulation that you can withdraw your offer at any time prior to bank approval. The agent may not make it pending in MLS and they will continue to market the property and look for other offers. Some sellers/agents won’t take that contingency on an offer, some will. No guarantees with anything.

If you haven’t started working with a Real Estate Agent and are thinking of buying or selling a home in Tampa Bay, please contact me. I’m here to help!

Rae Catanese, PA

Prudential Tropical Realty

813 784 7744

realtyrae@yahoo.com

Search all homes for Sale in Tampa Bay, get comparable home sales in your neighborhood and more. Visit www.TampaBayDwellings.com

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Distressed about Short Sales and the Process? Tampa, Fl

by Rae Catanese on March 11, 2009

in Bank Owned and Short Sale, First Time Home Buying Advice, Selling Home as Short Sale, Selling Your Home, Short Sale vs Foreclosure, Tampa Housing Market, Tampa Real Estate Market News & Updates

When I started thinking about a title for this article I came up with quite a few. The METHOD of the Short Sale was 2nd choice. Although, we are finding there is NO Methodology in the Tampa Real Estate Market.

Putting in an offer on a Short Sale Home in the Tampa Bay Area?

Thinking of buying a short sale home is painful to many who can wait as long as 45 days to hear if the bank accepted their offer. Tampa Bay Sunset

There is no Method!

I can certainly without a doubt, say that there are no rules when it comes to what the banks will or will not do. Every bank is different about the way they handle things. Some are using mitigation companies to negotiate the offer, and some are not. Banks each have their way of handling paperwork and disclosures which makes our job as Realtors even more challenging.

What Realtors and Sellers are doing to get offers on short sales:

A price you see listed on any website is not necessarily the price you can buy that home for. If you’ve seen wording or disclaimers stating “listing price may not be sufficient to cover all closing costs…” that is when you know the home is listed as a short sale. Try telling people who are qualified to buy a home, that we don’t know if the price listed is a real sales price. Otherwise known as “bank approved short sale”.

I’ve seen some listed for an unbelievable prices. When I contact the listing agent, I have to ask if that price “has been approved by the bank”. Otherwise, the seller agrees to list the home for what ever they want.

What happens next??? Sellers are submitting multiple offers to the bank and the bank is then forced to either take one or foreclose on the home. Once the bank gets offers at the low ball price, it speeds up the short sale process.

How many properties are on the market in the metro Tampa Bay Area? (approximately 33,000.00 in the Pinellas, Pasco and Hillsborough Areas)

I’m finding there are several situations that would lead more people to buying a foreclosed home. First, they are probably getting a better deal after the bank owns the property. The bank will respond to most offers within 48 hours, 2 business days. You will also know if there are any other offers in the mix.

Most buyers I am working with are telling me that they want to stay away from short sales. If you are a seller, please take this into consideration before listing your home for sale with a Realtor.

Rae Catanese, PA

Prudential Tropical Realty- Tampa, Fl 813 784 7744

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Investors Face Tax Liability on Short Sales-Tampa, Fl

by Rae Catanese on January 12, 2009

in Amendments to Property Tax Law, Bank Owned and Short Sale, Hillsborough County Property Taxes, Selling Home as Short Sale, Selling Your Home, Short Sales Tampa, Tampa Real Estate Investors

Investors Still On Tax Hook

(Tampa Tribune (FL) (KRT) Via Acquire Media NewsEdge)

For homeowners in trouble, a short sale can be a lifesaver.

Lenders allow a house to be sold for less than is owed on the mortgage and then write off the rest. The homeowner just walks away.

Unless the owner is an investor, that is.

A short sale gets these owners off the hook for the loan, but many will get a surprise from Uncle Sam next tax season: an income tax bill based on the amount forgiven by the lender.

“I’m telling you this is going to be a big issue,” said Ralph Fisher, a Lutz attorney who specializes in foreclosure. “If you’re an investor, watch out.”

As the Bay area’s foreclosure rate steadily increases each month, short sales are becoming a popular alternative for financially strapped homeowners who owe more than their homes are worth.

Late last year, as lenders started to permit more short sales, President Bush signed the Mortgage Forgiveness Debt Relief Act. Before the legislation, all homeowners had to pay income tax on the loan amount written off by the lender. Under the new law, owners won’t have to pay taxes on that amount, up to the original mortgage amount on the purchase of the home. But that’s only if the home is their primary residence.

345 Bayshore Condo

The president and legislators apparently took no pity on investors who gobbled up properties by the dozens during Florida’s red-hot housing boom and now can’t pay their mortgages. Those buyers, if they’re lucky enough to get a lender to agree to a short sale, will be stuck paying the resulting income tax.

That goes for owners of secondary homes as well, said Sue Hales, spokeswoman for the IRS. Homeowners who work out a short sale should receive a 1099 tax form with their lenders, she said.

Once they get the form, she said, they should carefully check the values of the shortfall amount and the house value.

For example, if a homeowner owes $250,000 on a mortgage and the lender agrees to let him or her sell the home for $200,000, the lender would forgive the $50,000. But if the owner doesn’t live in the home, he or she will have to claim the forgiven $50,000 as income.

Until late last year, the average homeowner had never heard of a short sale. Now, neighborhoods throughout the Tampa Bay area are dotted with for sale signs denoting the home as a “short sale.”

Of the 16,677 Hillsborough County area homes listed for sale in the Multiple Listing Service, nearly 20 percent are marked as a short sale. Brad Monroe, a real estate agent and former president of the Greater Tampa Association of Realtors, said he thinks the actual number of short sales occurring is much higher. Agents in Pasco County report short sales are as high as 60 percent of the properties they’re selling.

With real estate generally slow all over Florida, some real estate agents and title companies are specializing in getting lenders to approve short sales. Borrowers facing foreclosure are jumping on the opportunity.

Getting a short sale approved at all is difficult, and lenders aren’t always willing to approve them. However, faced with millions of dollars in losses in foreclosures — plus court costs — they are more likely now to approve short sales. Still, real estate agents say the approvals are often delayed or denied.

When homeowners do get approved for a short sale, a lot of borrowers aren’t getting good tax advice from some of the real estate professionals helping them with their deals, said Mike Edenfield, an attorney who works with foreclosures.

“Most people aren’t aware of it at all,” he said of the income tax requirement. “Florida is typically a debtor’s paradise. But the IRS has a super priority. For the investor out there who bought a bunch of condos and is now in trouble, they’re going to get bitten.”

Need advice or have questions?

Contact Rae Catanese, PA, Licensed Realtor in Tampa: Phone 813-784-7744

To see more news articles from Tampa Tribune or to subscribe to the newspaper, go to http://www.tampatrib.com.

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2009 Housing Market Forecast-Tampa Bay Area

by Rae Catanese on December 18, 2008

in Bank Owned and Short Sale, First Time Home Buying Advice, Foreclosures and Bank Owned, International Buyers, Short Sale vs Foreclosure, Short Sales Tampa, Tampa Housing Market, Tampa Real Estate Investors

With 2009 rapidly approaching, we must consider the changes that have occurred in our Real Estate market in Tampa, and plan for what we will experience in the coming year.

While 2009 will be a difficult year for many, it will also bring unprecedented opportunities for the few who choose to adapt now, before it’s too late.

The misconception comes when people are listening to the national media and do not consider the specific market conditions here in the Tampa Bay area; which are NOT the same.

Here’s why:

Florida is and always will be a tourist and retirement destination. You can’t compare us to the Detriot Housing market.

We have affordable housing, compared to the number one state for foreclosures (California), we are number 2. Our average median sales price is around 180K, as of last month.

Northerners who are planning to retire and purchase their second home are taking action now while prices are at their bottom, instead of waiting until they retire.

Believe it or not, people still have money and are paying cash for homes instead of investing in the stock market. This has been my personal experience just over the last few months.

2009 Housing Market Forecast

Prices will continue to fall but dramatic price drops such as those we saw between 2006 and 2008 are unlikely.
Affordability will drive an increase in existing-home sales. Proper pricing, as always, is essential.
More real estate agents will be leaving the business as they fail to adapt to market changes. (not me), let’s face it; if you have survived this long you have to love what you do!
Mortgage defaults will remain elevated as job and economic growth slows and the next significant wave of mortgages reset.
Short Sales will increase as loan modification efforts are exhausted and the majority of existing loan mods default again. Sellers will ask themselves if they are better off selling their homes on a short sale, absorbing the hit to their credit reports and becoming renters for a few years.
Real estate agents who specialize in short sales, bank owned property and foreclosures will see an increase of business.

The process of purchasing a home can be overwhelming, especially with our new wave of short sales and foreclosures. Make an informed decision, know all your options and choose carefully.

If you would like advice on purchasing a distressed property please feel free to contact us: info@thetamparealestateinsider.com or call 813 784 7744

Attend one of our Real Estate Meetup Groups

Rae Catanese, PA

Real Estate Agent

Prudential Tropical Realty-Tampa, Fl

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Short Sales vs. Foreclosures and its effects on Credit…. Breaking the myth

by Rae Catanese on November 24, 2008

in Bank Owned and Short Sale, Financing and Mortgage News, Foreclosure Statistics Tampa, Selling Your Home, Short Sale vs Foreclosure

Short Sales vs. Foreclosures and its effects on Credit…. Breaking the myth

There has been so much misinformation out there on the process of Foreclosures and Short sales; that I asked Katie Cook Hughes, Sr. Loan Officer at Prospect Mortgage in Tampa, Fl to clarify the situation for us!

I think that many sellers have been misinformed in regards to the effect a short sale will have on their credit. Many sellers think that they can short sale their current home and then qualify to purchase a new home immediately after their current home is sold. This is incorrect.

A short sale will show up on a client’s credit report as a “pre-foreclosure in redemption status”. The short sale will cause a 200 – 300 point drop to your credit score. For example… if your credit score was a 680, it could potentially drop to a 380.

The effect of a short sale is almost identical to that of a foreclosure regarding your credit.

The benefit of doing a short sale instead of letting your home go into foreclosure is the amount of time that will need to pass before you can purchase a new home. Based on Fannie Mae’s guidelines, a buyer can purchase a home 24 months after doing a short sale, whereas the same buyer would have to wait 48 months to buy after a foreclosure.

Got a question? Feel free to drop us an email at: info@TheTampaRealEstateInsider.com

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Rae Catanese

Short Sale vs Foreclosure

Hillsborough County (Tampa)

Pinellas County (St. Pete, Clearwater area)

The Complete Short Sale Process

How a Short Sale is Handled from Listing to Bank Approval

The Basics of a Short Sale

Writing the Short Sale Offer and Submitting to the Bank

The Short Sale Process at the Bank

If you need help buying or selling your home as a short sale please contact me. Rae Catanese, PA-Prudential Tropical Realty-

813 784 7744 or Email

Short Sales Tips for Sellers in the Tampa Real Estate Market

Top Real Estate Nightmares

Prudential Tropical Realty turns to Yesner & Boss for legal help

Investors Still On Tax Hook

Need advice or have questions?

Contact Rae Catanese, PA, Licensed Realtor in Tampa: Phone 813-784-7744

Here’s why:

Florida is and always will be a tourist and retirement destination. You can’t compare us to the Detriot Housing market.

We have affordable housing, compared to the number one state for foreclosures (California), we are number 2. Our average median sales price is around 180K, as of last month.

Northerners who are planning to retire and purchase their second home are taking action now while prices are at their bottom, instead of waiting until they retire.

Believe it or not, people still have money and are paying cash for homes instead of investing in the stock market. This has been my personal experience just over the last few months.

2009 Housing Market Forecast

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