Struggling to make your mortgage payments?

April 15, 2010

The Obama Administration’s Making Home Affordable Program includes opportunities to modify or refinance your mortgage to make your monthly payments more affordable.

If you are struggling to make your mortgage payments you should watch this video:

After watching the video, contact your lender to see if a mortgage refinance or modification is right for you and will allow you to adjust your payments in a way that make them more manageable and allow you to keep your home and avoid foreclosure.

Kerstin G. Brooks
Brooks & Heinze Team
Skyline Properties, Inc

Under water? Can’t afford your mortgage payments anymore? Short Sale as Foreclosure Avoidance Tool best for some Homeowners

February 28, 2010

According to yesterday’s issue of the Puget Sound Business Journal, about 16 percent of all residential properties with mortgages were in negative equity at the end of the year in Washington State.

Negative equity means the homeowner owes more on the home than the home is worth.  This  can occur because of a decline in real estate value and/or  an increase in mortgage debt.

In Washington state, there were 3,288 foreclosure filings  in November of 2009, with one in every 835 housing units receiving a foreclosure notice — a 15 percent increase from November 2008.

Today, the Seattle PI reported more bad news about the Labor Market.  According to the PI, it was the second straight week that claims rose unexpectedly.  High unemployment remains one of the biggest obstacles to a sustained economic recovery.

In short, the economy is still shaky and more and more homeowners are struggling to make their mortgage payments and feel stuck because they know they cannot sell their home at a price that will cover their mortgage.  Depressed, scared and uninformed about their options, many wait until the bank forecloses and evicts them from their home.

For some homeowners, a short sale may be the option they are looking for. A real estate agent may be able to sell their home in a short sale which means the bank allows them to sell their home at market value and forgives some of their mortgage debt to make the sale possible.

Each situation is different and there are no guarantees. If anyone says they can guarantee a successful short sale or charges you upfront, nonrefundable fees to negotiate a short sale for you — run!

Generally, a short sale is better for a homeowner than a foreclosure. The ramifications of a short sale on your credit history are much less severe than with a foreclosure. If you are looking to apply for an apartment and you have a foreclosure and bank eviction on your history, you may have a hard time finding a rental. Bad credit will also affect your insurance rates, employment opportunities, etc.

Your eligibility for a new home loan will be affected more gravely with a foreclosure on your record. Underwriting and qualifying guidelines for mortgages change all the time but with a short sale on your record you may qualify for a new loan in a couple of years, whereas a foreclosure may keep you from buying a new home for 6-7+ years.

If you are in the Greater Seattle Area and want to talk to an agent about selling your home as a Short Sale, please contact the Brooks & Heinze Team for a free, no-obligation consultation.

Kerstin G. Brooks
Brooks & Heinze Team
Skyline Properties, Inc.
Ph: 206.276.5827

Houses for Pennies on the Dollar? Really?

February 19, 2010

 Many buyers have heard that Seattle real estate is more affordable than ever. Yes, prices have dropped quite substantially but when I hear people saying or I read articles about “Houses for Pennies on the Dollar” I get a little perturbed.

 We have had a few people contact us with unrealistic expectations about what they can buy. We have had buyers asking us to find them large, updated homes with water views in nice neighborhoods like Greenlake, Richmond Beach, Queen Anne, etc. under $200,000. You’d be hard pressed to find a tiny tear down for that price in these neighborhoods. 

Don’t get me wrong, there are bargains to be had but one must be realistic. Foreclosures and Short Sales can be a good value but they often require work and patience.

Buyers want to look at bank foreclosures, but they don’t want to do any work if it needs repair. They expect all homes should sell at the bank foreclosure prices regardless of whether they need work or not.

The homes that need a lot of work are the ones that sell for bargain prices. So, if you want a steal be prepared to have to do some work.

Many buyers feel the foreclosures set the prices in the neighborhood even though they may be missing a bathroom, have a structural issue and need tens of thousands of dollars in updates. Buyers are quite often dissatisfied with the condition of the distressed properties, but they don’t want to look at a regular home that is all fixed up because it is not a perceived bargain (when they can be).

You could take two similar homes next door to each other, one being a foreclosure and needing $35,000 in repairs and another being a normal sale and in excellent condition. The bank foreclosure might be priced $35,000 below the normal home, but when the buyer sees it they’re turned off.  But then they’re also turned off by the price of the normal home because they feel it should be priced the same as the foreclosure fixer.

In short, there are bargains but be realistic. Either buy an updated home in good condition and get a fair price or get a fabulous bargain for a home that needs a lot of help and needs to be nursed back to health. Buying at a 20-30% discount compared to just a few years ago is a great deal and realistic. Homes for pennies to the dollar? Not in Seattle.

There are some great loan programs available for buying distressed and foreclosed homes that need repairs, such as the 203k FHA rehab loans & conventional construction loans.

For more information on these loan programs contact Michele Catoire at the Legacy Group in Bellevue, WA by email  at or by phone at (425) 818-5885.

 Michele Catoire

Happy bargain hunting!

Kerstin G. Brooks
Brooks & Heinze Team
Skyline Properties, Inc.
Cell:  206.276.5827

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