Betsie Melter's Real Estate Blog

I just wanted to let consumers out there know a little bit about what we deal with behind the scenes of a short sale.

The most recent scenario happened to me on Wednesday. I called the listing agent of a short sale that my buyer has an offer in on to check on status. He said that the first mortgage had offered the 2nd mortgage (who was the same bank by the way) $2100 at closing. The 2nd mortgage had responded to the agent (because apparantly the 1st and the 2nd mortgage don't talk to each other eventhough they are in the same building) that they wanted $3000. The 1st mortgage then decided to only offer them $1500. The agent now had to go back to the 2nd mortgage and tell them that the original offer of $2100 had decreased to $1500. HA HA HA HA.

This is what we are dealing with everyday. The banks aren't on the same page and the agent has to do triple the work when really shouldn't the 1st and the 2nd be working it out on their own. Especially if they have a standard amount that they accept on the 2nd mortgage, shouldn't the 1st mortgage just know that they routinely accept $3,000 on a short sale for the 2nd mortgage and just offer that and be done with it. The poor listing agent has been going round and round with these 2 for over 2 weeks now.

This is just one example of what we do on a daily basis in order to make a short sale work. I have had great success with short sales because I hire an amazing negotiator. But really, these loops are starting to kill us.

I try to explain to both buyers and sellers, some of the circumstances and obstacles we may run into while waiting for an answer from the short sale bank, but I can never predict what they will say and I have found that every transaction throws something new at me. So, if you are thinking of buying or selling a short sale house, please be prepared for jumping through hoops and not being surprised by anything the bank says. Think of it as your daily dose of humor and just laugh because that is all you can do sometimes.

This is a question that I get asked a lot. I thought that it was 7 years, but I recently read in the Arizona Realtor Magazine that it could be more like 3 years. Wow, that isn't that long to have to wait. I was really shocked. But that could be great news for people who did a strategic walk away and are working on getting their credit back in order.

According to Patrick Ritchie, the author of the article, some consumers will have a chance in as little as 3 years from a foreclosure to purchase again. The FHA guidelines allow for a loan to be obtained 3 years after as long as NOTHING else has been delinquent. Any negative reporting or any missed or late payments will negate it, but if everything has been paid on time, then more than likely a buyer can purchase again.  Now, there are circumstances where an FHA, VA or USDA loan may have a claim against them in the Credit Alert Verification Reporting System. If that is the case then the 3 years starts after that claim has been paid. A loan officer can check in the HUD system to see if a buyer has a claim against them. This might be something a homeowner may want to check on sooner rather than later if they plan on purchasing another home in the future.

Just because a person has waited 3 years and hasn't missed any payments, doesn't mean they are automatically approved for a loan. As we know, right now there are very tight guidelines. That would just be the first step in knowing you can try. Any borrower still has to have good credit, make enough money to qualify for the loan, and have a down payment. Employment is also a big deal. The borrower needs to have been employed for at least 2 years with the same company or in the same industry.

The underwriter has the final say, of course, as to whether or not a borrower will get the loan. But at least now we know it isn't an automatic 7 years, like I had previously thought.

If you would like more information on what time lines exist for short sales, bankruptcy's and other situations, click the link below. The National Association of Realtors has put together a chart for different experiences.

http://www.realtor.org/wps/wcm/connect/1919ce80433346c5849787b0e53c74b2/government_affairs_impact_credit_events_07112010.pdf?MOD=AJPERES&CACHEID=1919ce80433346c5849787b0e53c74b2

My webmaster and IT extraordinaire introduced our office to QR codes this week. QR codes are a little graphic that you can put on print media and people who have smart phones can use them to scan info to their phones. It basically takes a picture of the graphic and it tells your phone where to go and brings up the website that the graphic has embedded into it. It is pretty cool.

He recommended using Scanlife, but there are a number of different companies out there doing it now. So, my next goal is to search out these QR codes and practice using them to see if they work and how easy they are to scan. Then, I am going to start putting the codes on my flyers for buyers or renters to use when driving by a property. My only problem is going to be getting the word out to people so they know what QR codes are and see the benefit to them. This way when I put a QR code on my flyers, people will actually use them.

I think it will be a really cool tool once people get used to them. The benefit for the client would be that when they are driving by one of my listings they can scan the QR code and my website or the specific home will pop up and they can see all of the pictures or the virtual tour right there on their phone in front of the house.

The technology that has come out in the last couple of years is just mind-boggling. I feel like I finally get the grasp of one thing and in the meantime 10 other things have already come and gone. I do see the usefulness of this and the instant gratification to the consumer. But like all things, it has to be used in order to be helpful and worthwhile.

Well, this is a little late, but Chandler was recently voted an All America City. Chandler is one of 10 winners of this national award. To read more about it click on the link http://www.chandleraz.gov/default.aspx?pageid=40

Congratulations Chandler! It makes me feel proud to live here. My family and I attended the Fireworks show at Tumbleweed Park on the 4th of July and they announced the award that night as well. The fireworks were spectacular and the music was all american music. It made you realize what a great country we live in and even better, what a great town we live in.

I think many people who are going through a short sale or foreclosure think that their HOA dues are part of that and stop paying them. Well, they aren't. The Homeowner's Associations are really starting to take action against owners who are not paying their monthly dues. Many articles have been released lately talking about HOA's hiring attorney's to recuperate the dues not paid by homeowners. This leads to the owner having to pay far more than if they would have just paid their monthly dues.

When a homeowner buys a house, the CC & R's state what the dues are and what they cover and the owner signs an addendum stating that they understand the rules and are agreeing to pay the dues. Just because they are leaving the house doesn't mean that they can negate the contract they signed with the HOA. Not to mention, it really puts a burden on the neighbors. The other owners in the neighborhood have to make up for the missing payments or have other ammenities taken away becasue the association can't pay for them anymore. Or, worse, the remaining homeowners have to pay an assessment out of their pockets in order to pay for the maintenance of the community.

So, if you are going through a short sale or foreclosure, please do your neighbors a favor and keep paying your HOA dues until you officially don't own the property any longer. And just an FYI, filing bankruptcy doesn't always end a homeowner's obligation to his Association, so be sure to seek legal advice.

I recently read a refreshing article about how FHA appraisal guidelines are not as strict as they used to be. I am hoping the appraisers will start taking this to heart because I have had some crazy requirements with FHA Appraisals ( carpet needing to be cleaned and the grass to be mowed seem to come to mind).

Steve Lines with Academy Mortgage writes in the Arizona Journal of Real Estate & Business about the requirements. Basically he states that FHA permits an "AS IS" appraisal for FHA loans for property's that have problems that have occurred from lack of maintenence or normal wear and tear. These guidelines have been in place since January 2006, but I haven't run into an appraiser who has done it that way yet.

FHA does state what is a Definite Repair Needed:

Inadequate access from bedrooms to exterior of home.

Leaking Roofs

Structural Problems (foundation, trusses, beams etc)

Defective Paint if constructed before 1978

Defective exterior Paint constructed after 1978 if finish is not protected

Other than those most other items can pass an FHA Appraisal. Good to know if you didn't already know this! The majority of loans I have done in the last 2 years are FHA, so I am always looking for more information so I can know what to expect for my buyers.

The rental market in the Phoenix area is out of control lately. Our inventory which is normally in the 8500 range is currently under 3200 and decreasing rapidly. Because we took such a hard hit with foreclosures and are still very high in short sales, all of the owners of those homes still need to find a place to live but can no longer qualify to purchase a home. Thus, we have a high demand for rentals.

This is great news for Landlords, but they have a tough decision to make. When you look at a credit report what parts are most important? It is really tough. Most of the applicants' credit scores are very low due to the short sale or foreclosure. So, I tell my landlords, those don't really mean that much in this market. But what they should look at is their employment history, security in that job, debt to income ratio if available and late payments on other accounts. I am looking for someone that is going to be in their job for the long term and can make their rent payment monthly if they end up losing that job. So, money in the bank and low monthly bills. Also, calling past landlords or driving by the house they foreclosed on may help tell you how they took care of the house. I really want someone who is going to respect the house.

Some landlords may or may not care about certain things, so it is always important to ask what they are looking for most in a tenant then try to find one that fits that criteria. And as we are finding out, credit doesn't mean everything.

An agent who was holding an open house on Easter Sunday in Scottsdale, AZ was robbed. A female came into the open house and asked for a tour while they were outside a Male came in and stole credit cards, cash and a few personal items out of the Realtor's purse (which was hidden in a cabinet in the kitchen). The Realtor was able to get a good look at the Male and the car and has given all of the information to the police. The 2 of them are thought to have done this before. Details of suspects are:

FEMALE: Light skinned Black, 5'7", 125 pounds, mid 30‘s, slender build, ‘Keratosis" marks on both cheeks, (like, red lipstick, mascara, coarse, dark hair with lighter colored tips, worn feathered back

Morgan Freeman, the actor)

from face, bangs, blue floral wrap dress, open toed, sling back shoes, very well dressed, no accent.

MALE: Very light skinned Black or possibly part Hispanic, 5'8", 150 pounds, mid 30‘s, no excess weight, but

well muscled, boxy build, small facial features, fit looking, wearing dress slacks, white shirt, dark tie, short, neat

hair, styled with product to give high gloss appearance.

VEHICLE: Mid 90's, dark colored, generic four door sedan. Dull paint. Male drove.

*Several of the stolen items were recovered one week later, tossed into an open field at Dobson Road off

101. WATCH YOUR VALUABLES, note additional details, license plate # and call your broker for further action.

This is a good reminder to all of us that this can happen in any location at anytime. Please be safe out there.

I have been looking through pictures of listings for the last 2 hours trying to find some homes to show my buyer. I have to laugh. I have never seen so many pictures of dogs in listings. Don't get me wrong, I love dogs, my client loves dogs and we both have dogs. But do you really want to see a dog in a listing photograph?

Honestly, I want to see the floorplan, what type of counters are in the kitchen, did the bathrooms get updated, how big is the yard, and what type of flooring is in the house. I don't need to see a picture of the family pet laying on a couch.

Please, listing agents, put pictures in the MLS that show what buyers want to see. What if someone is looking for a house that doesn't have a pet because they have allergies? You would have just turned off a buyer and they didn't even make it to the next picture.

The seller's probably aren't that happy that you have their pet in there either. They want you to market their house in the best way possible. The blurry pictures that I have seen with a dog upside down or licking himself, is probably not putting the house in the best light or working the best for your seller. Just a thought. I might be wrong though.

I did put my Lab puppy in a picture once when I was selling land up in the mountains. He sat next to my sign with a smile and I sold it in 1 day. So, what do I know. So if you insist in putting the pet in the picture at least have them looking at the camera and the lens focused. Thank You!

I received an email today from Marlo at the Lending Company and I wanted to pass on the info he sent.

We in AZ are used to having pools. What happens when your neighbor moves out of state or the house goes into foreclosure? Who takes care of the pool? Most likely nobody and it turns green. Especially in the summer when it is 110 degrees, it turns green Quickly. Then what? Mosquitos come!!!

Well, from what Marlo is saying you can call the Maricopa County Vector Control for Environmental Services and they will put Mosquito Fish into the pool. I guess these fish eat the larvae before the Mosquitos can hatch. I guess I'll try anything once. Plus it is a free service!

So, if you see a green pool call Vector control at 602.506.0700.

It is illegal to have a green pool, so don't hesitate to call. It is our responsibility to keep the spread of disease down. Anyway, who wants mosquitos in your yard?

Hope this helps at least one person out there. And if you try it, let me know if the fish really work!