Listing Courtesy of COLDWELL BANKER RESORT REALTY - R
Whenever an unplanned and unwelcome financial situation develops, a Lewes mortgage-holder can find himself or herself in the onerous position of being unable to keep up with the monthly home loan payments. If the unhappy situation continues long enough, the likely result is a foreclosure or short sale. In addition to losing the property, the impact on personal credit then takes years to undo. That means it takes that much longer for a consumer to acquire a new home and start to build equity again.
Here as elsewhere, there were a raft of such Lewes mortgage defaults following the global financial meltdown. Even those who had no trouble servicing their area mortgages could have suffered when they found that falling property values prevented them from refinancing—even when the purpose was to improve their property. Although those events happened years ago, it’s only now that their aftereffects are finally working their way out of the system.
A recent article in NMP—the national Mortgage Professional’s magazine—delved into the changing status of those who lost homes in the turndown. The details they researched are interesting in themselves—details that are bound to have an impact on Lewes residential sales.
First off is the fact that enough time has elapsed for those who weathered a short sale or foreclosure to begin to return to eligibility. They’re called “Boomerang Buyers”—and nationwide, there are estimated to be 7,300,000 of them! In 2016 alone, more than a million will become eligible to return to the home-buying market. According to NMP, “they’re returning to the market in droves.” The hardest-hit states were Nevada, Florida and Illinois—but there are plenty of Boomerang Buyers scattered across the rest of the nation.
The improving mortgage eligibility landscape extends beyond those who suffered the actual loss of their homes. To the more than 7 million “distressed” homeowners whose properties are still underwater (those who owe more than market value), the government’s HARP 2 program is one possible remedy. Its guidelines encourage lenders to relax the loan-to-value caps that had prevented refinancing for many of those homeowners. Reports are that it has already resulted in an increase in such refinances.
Other program combinations are helping loan originators and Realtors® get more bank-owned homes back into homeowners’ hands. These are properties that make up the ‘shadow inventory’ of unsold homes, many of which have fallen into disrepair. Because of that, they’ve been difficult to finance—and therefore difficult to sell. Through FHA 203K and Fannie Mae’s Homestyle® renovation mortgages, more ambitious prospective owners—including investors—are discovering they now have mortgage options that can put those fixer-uppers within reach.
For those who have previously found it problematic to secure a Lewes mortgage with acceptable terms, it may be worth looking into today’s improved financing alternatives. Especially with mortgage interest rates at the levels we’re seeing this fall, what you find may be a pleasant surprise—one that puts you into the house of your dreams. Call me to discuss first steps! Call/Text me Russell Stucki at (302) 228-7871, email me at firstname.lastname@example.org, visit more listings at www.beachrealestatemarket.com.
A Sussex County short sale is a transaction in which the amount paid is not sufficient to cover the existing mortgage or property liens. Once the lender agrees to accept the lesser amount, the short sale succeeds, the lender calls it even with the seller, and all parties can move forward.
It’s a good thing to ‘unfreeze’ a property, yet short sales in Delaware can be tricky to close. In the worst-case scenario, a buyer and would-be short seller can be put on ice for a full year or more before the short sale succeeds. As is evident to anyone who has been through the process, a Sussex County real estate agent with short sale experience is essential for leading the way through the negotiations and closing.
In addition to working with a knowledgeable agent, it’s good to also approach a situation which might turn into a short sale by understanding the general precepts that influence those who will make the decisions. Usually, the mortgage-holding bank publishes how they wish to be contacted. Often, it’s through the “Loss Mitigation” Department (or a title to that effect). That language tells you all you have to know to explain why their attitude may be less than enthusiastic.
Like any commercial business, the bank’s decision-makers seek to minimize the time and man-hours needed to gain the best result. If you come to them with what is an obviously unreasonable offer, they are no more likely to react positively than any other seller. For this reason, researching the market value of nearby properties--enough so that it’s easy to show that your offer is based on a reasonable discount from those prices—is the best way to be taken seriously.
Although you shouldn’t be surprised if even a reasonable offer is turned down at first, don’t be afraid to counter with a second offer.
Depending on the circumstances, I sometimes advise my clients to decide on a viable time frame in which to either close the deal or move on. Not only will this prevent your wasting time, but it can motivate a loan officer to truncate what might otherwise become long-winded negotiations.
Short sales in Sussex County are still to be found for motivated and patient buyers. If you are looking to buy a home in the coming year, now is the right time to call me to start your search! Call/text 302-228-7871 or email me, Russell Stucki, REALTOR ® of Beach Real Estate Market to provide detailed information on Delaware homes for sale, investment and commercial properties, luxury and waterfront homes, condos/townhomes, new construction, lots and land, farms and equestrian properties located in but not limited to Bethany, Bethel, Bridgeville, Dagsboro, Delmar, Ellendale, Fenwick Island, Frankford, Georgetown, Greenwood, Harbeson, Laurel, Lewes, Lincoln, Milford, Millsboro, Millville, Milton, Ocean View, Rehoboth Beach, Seaford, Selbyville, Delaware.