Friday is For Fundraisers - Frederick Relay For Life

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Today I am at the Frederick Fair Grounds for the American Cancer Society Relay For Life. I will be twittering events and also sending pictures to my Photoblog and Flickr account. Each time I will be trying to solicit more and more donations through out the night. I will be looking for the support of my online friends as well as my off-line friends.

In order to attract my fellow bloggers…I will be sending them some link love, please take the time to visit their sites while you are here.

What happens is each one of these Bloggers will get nosy and see why some is linking back to their blog. Hopefully they would like to donate to a great cause…cause today, I am blogging for a cause.

DONATE NOW PLEASE - this will take you to a secure site.

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May 16, 2008 · Filed Under Frederick Events, Frederick MD Real Estate, Fundraiser

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Monday morning Market update

The sales continue to show a decrease over last year, however, on a more positive side, the decrease seems to be getting smaller. Are we finally seeing signs of the bottom of the market? A recent article in the Wall Street Journal seems to see other signs that point to a more normal market. This process didn’t happen over night so the repair is not going to happen over night.

Most people forget that the current housing bust is nearly three years old. Home sales peaked in July 2005. New home sales are down a staggering 63% from peak levels of 1.4 million. Housing starts have fallen more than 50% and, adjusted for population growth, are back to the trough levels of 1982.

I remember almost to the day when this started, I started to see signs the following weekend after the 4th of July. The showings on properties came to a screeching halt. Honestly it was like someone just flipped a switch. I had a very eager seller, and no explanation on why we went from 4-6 showings on a weekend to almost none. (his house sold almost year later for $50,000 less than what was expected.)

The county housing reports are out for April. If you have the time take a look that past reports and you will see a what I am talking about above.

If you need a closer look at a community around you, contact me for a Market Analysis.

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May 12, 2008 · Filed Under Frederick MD Real Estate, Frederick Market Conditions, Market Condition

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Fridays Foto for Short Sales but not real estate

Well not exactly a short sale, but a short sales person maybe… I passed Connie Snook’s little car and couldn’t resist a Friday Foto.

She may drive a short car, she might even be short, but I bet she’s not short on customer service.

I wonder how small she can make your insurance premiums??? Give Connie Snook a call at 301-695-7896. Or you can stop by her website at conniesnook.org and request a quote. She is located at 1 Mt Olivet Blvd, Frederick MD 21701.

This is not an endorsement only a photo op for her car. ; )

Have a great weekend.

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May 9, 2008 · Filed Under Frederick Business, Frederick MD Real Estate, Friday, Fun

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What happens to my Credit Scores with a Foreclosure and Short sale

There is more to foreclosures and short sales after the gavel falls. The solutions are quick in the scheme of things but have a long lasting affect on the sellers (former homeowners) credit. Plenty of people are willing to accept the long term due to the fact there is no real monetary loss. What? Think about it…there were plenty of homes sold in the last few years with 100% financing. In other words, the buyer never had to save any money to buy their home…just sign your name. You can argue the case that there is money loss, but my question is to who? The Short Sale is a smaller debt forgiveness that the bank basically eats. The government used to tax a piece of the pseudo income to the former homeowner, but the homeowner never really had it to lose. (pseudo is tongue and cheek, some homeowners cashed out their home equity lines of credit for vacations and cars) This might even be you, that’s the risk you took. Things happen and we don’t have too much control over it. If we had a crystal ball, we would all be millionaires. But either way, the home was worth less than the market was willing to pay.

Back to my point there is no real monetary loss to the homeowner. This was not the case when lenders actually required a down payment or some kind of assets to secure the loan. I guess they shot themselves in the foot thinking that this housing boom would last. They are starting to require it now… gee, I wonder why?

Well then, what happens for the long haul? Outside of shattered dreams of owning your dream home, the credit scores will take a hit. But how bad? I came across an article in Broker Agent News but I have heard different stories on the impact on credit scores.

Foreclosure or Deed-in-Lieu of Foreclosure
Both of these solutions affect credit the same. Sellers will take a hit of 200 to 300 points, depending on overall condition of credit. This means if a seller’s FICO score before foreclosure was 680, it could dip as low as 380.

Short Sale
The effect of a short sale on a seller’s credit report is identical to that of a foreclosure. The ding on credit will show up as a pre-foreclosure in redemption status. Which will result in a loss of 200 to 300 points. This means a short sale with a previous FICO of 720 will see it fall from 520 to 420.

They claim that they have the same impact. The length of time that they impact are different. foreclosures will last much longer than a short sale. Below is an excerpt from Debtkid, someone that has lived through a short sale and has had first hand experience.

- Expect to suffer some credit score damage, but nowhere near as much. Loss of FICO points will be around 75-125 and your report will show it listed as a ‘pre-foreclosure in redemption’ which is far less negative. You will most probably be able to secure a new home loan in about a year and a half.

This has been more inline with what I have heard from others in the financial field. But don’t take this as the be all know all information about your credit scores. Seek professional advice from your tax planner and financial planner. Either way, foreclosures and short sales have long term effects on your credit.

There is information about the length of time for that one can purchase after the deficiency on About.

Foreclosure or Deed-in-Lieu of Foreclosure
Steep says a seller who wants to buy another home after foreclosure will end up waiting about 36 months before a lender will offer any kind of interest rate that makes sense.Coy says, “A notation on a consumer’s credit profile of ’settled for less than owed’ (short sale) precludes the consumer from obtaining an institutional loan for 24 to 48 months, depending on the lender / program and regardless of FICO score.”

For more information, see the Fannie Mae Selling Guide online. Click on the PDF link in the yellow box and see page 75.

Short Sale
Some agents say the good news for short sale sellers is the wait is much shorter before buying another home, but that belief is a falsehood.Can a seller buy again under two years? Not true, says Coy, “It’s an utter myth that a consumer can ‘can buy again in about 18 months at a good interest rate.’ Fannie Mae guidelines require 24 months’ seasoning, and there’s no way to get around this.”

I have also found a great discussion on the topic with real life situations in the comment thread over on Active Rain. But something that really stuck with me was mentioned by David Mordue.

Do what is best for your family in terms of relieving financial stress and giving you the best quality of life.

Your credit score is not the most important thing here. Your family is.

The creditors that gave you credit did nothing more than use a computer program (FICO) to determine whether or not you were a safe bet. They set up their pools of credit accounts with the full understanding that some people will not be able to pay back. It’s all part of their business model. Don’t feel that because you are unable to pay a credit card that someone that you’re personally letting someone down.

First and foremost, you need to educate yourself on options. Again, I can’t stress it anymore, but you have to do something…ignoring Foreclosesure will not make it go away.

If you have questions, please call…I’ll be glad to help.

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