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Your First REO Listing - Cash For Keys Agreements

Jul 302010

Cash for Keys agreements are a tool many corporate sellers give REO agents to help move the occupants out of repossessed assets. In short it’s an agreement by the bank to pay the occupant to move by a certain date and with certain conditions.

The conditions are usually to move out within 15 days and take all of their belongings. Remove all trash and not take any fixtures from the property. The most common problem with repossessed homes is the amount of trash left behind. This agreement can save time and money by having the occupant move out and deliver the home in selling condition. Striping of the home and damage to walls and fixtures is almost completely eliminated.

What the occupant gets in return is a check for an amount of money that will be negotiated by the asset manager. The amount of money has increased in recent months. Most times the agreement was for five hundred to twenty five hundred dollars. Now its not uncommon to see lenders offer a tenant up to seven thousand dollars to move out in fifteen days and deliver the home clean.

This in turn can help the agent get the home on the market much sooner. Were talking about 3 to 4 months sooner than if an eviction is done. Eviction will be much longer and expensive. The market can change in that much time and for the seller the most important point is to sell the home at its highest value in as short a period of time possible.

Cash for Keys agreements take negotiation skills and tactful conversation with the occupant of the property. Many times the occupants are irritated owners who feel they weren’t helped by the lenders or worse tenants who had been paying rent only to find out that the home wasn’t paid and they have to find a place to live in 30 days or less. Being patient and understanding the person’s position will go a long way in having them accept the cash for keys agreement.

A few things we try to do when we negotiate an agreement are to set an appointment for the inspection of the property, before we hand over the check. Personally inspect the home and make sure the agreement is being met. If possible try to re-key the home the same day. If not the following day, the worst would be to have them back in after delivering the check. Also important is to notify your asset manager of the successful completion of the cash for keys agreement without any incidents the same day.

Charlie Memen is an owner manager of a Real Estate office in Orange County California. He currently operates a Non-Franchise Real Estate company and mortgage company. He regularly holds seminars and classes for first time buyers, real estate and mortgage professionals.

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Author: Charlie Memen
Article Source: EzineArticles.com
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The Property Preservation Business Opportunity - More Foreclosure Trash Outs Coming Faster

Property Preservation Training No Responses »

Jul 302010

In the first quarter of 2010, there were more foreclosures recorded in the USA than there had ever had been before – since they began keeping statistics on them. Although numerous economists continue to claim the Great Recession is over, the housing market is still plagued by a giant backlog of foreclosures that is just finally beginning to be dealt with.

That means at least several more years of big opportunity for those in the business of securing, repairing and performing trash outs on these foreclosures – the property preservation business.

Banks are finally publicly recording the millions of homes in default that formed the “shadow inventory” of foreclosures that had been held back from market. The government has also decided to help streamline the foreclosure process by changing its definition of what a foreclosure is.

On Friday, April 2nd, HUD decided to classify any property that is at least 60 days behind on the mortgage or the property owner is 90 days or more delinquent on tax payments as a foreclosed home.

Not only that, but HUD is also expanding the definition of an “abandoned” property. Now included are houses where no mortgage or tax payments have been made by the property owner for at least 90 days – or a code enforcement inspection has determined that the property is not habitable and the owner has taken no corrective actions within 90 days of notification of the deficiencies.

HUD is doing this because neighborhoods continue to be in danger from the sheer number of homes that aren’t “technically” foreclosures. These homes, that become dangerously rundown from being vacant, foster crime, lower local property values dramatically and become a physical safety hazard for children and even adults who live in the area.

In the past few years, bureaucratic roadblocks and slow foreclosure processes have created this overload of abandoned properties. Now, the sheer numbers have forced authorities both in the government and the financial sector to record these homes as foreclosures faster and hire property preservation companies and mortgage field service companies to do a trash out and rehabilitate them as soon as possible.

This means the foreclosure business opportunity for everyone in the property preservation industry will grow even bigger than it has before, with more foreclosures hitting the market and more record-setting numbers predicted to hit by the end of 2010. Many just entering this lucrative field who get the proper expert training find themselves making up to 5 figures a week.

Author: Frank Patrick
Article Source: EzineArticles.com
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One Million Foreclosed Homes Forecast For 2010

Lender Processing Services No Responses »

Jul 302010

According to RealtyTrac Inc., more than 900,000 American homes were repossessed in 2009 due to foreclosures. So far in 2010, there have already been almost 528,000 homes taken over this year from homeowners who have fallen behind on their payments. If the first half of the year is any indication of what’s to come, RealtyTrac predicts that number to increase to about one million repossessed American homes by the end of 2010.

In comparison to any normal year, that number is around 100,000, so a figure of one million, according to Rick Sharga, a senior vice president at RealtyTrac., “That would be unprecedented.” RealtyTrac. Inc. follows scheduled home auctions, defaulted loans and home repossessions. They have noted that home foreclosures during the first part of the year have increased by 8 per cent when compared to the same time last year, but has also mentioned that figure has decreased by 5 per cent from the latter part of 2009. They say approximately 1.7 million homeowners have received foreclosure warnings within the first 5 months of the year, which means one in every 78 homes is in jeopardy.

Home repossessions have slowed in recent months, but does continue to be a concern even though banks are allowing delinquent homeowners to stay in their homes longer, but this has only caused a backlog of foreclosed homes. “The banks are really sort of controlling or managing the dial on how fast these things get processed so they can ultimately manage the inventory of distressed assets on the market,” Sharga said.

He also takes into account that there could be another surge of foreclosures if the U.S. economy remains the same with high unemployment rates and a slow economic recovery. On average, Lender Processing Services Inc. which tracks mortgages, says it takes approximately 15 months for a house to go into foreclosure and sold. With the current predicted rate, it could take into 2013 for all these backlogged foreclosures to clear. They also say found that there are currently more than 7.3 million mortgage loans in some form of delinquency.

With so many foreclosures on the market, its bound to push property values down as these houses are generally sold at steep discounts and will have an impact on surrounding homes in their area. “The downward pressure from foreclosures will persist and prices will be very weak well into 2012,” said Celia Chen, senior director of Moody’s Economy.com.

It can be tough when the economy simply won’t snap out of the pitfalls of a recession, even with government aid such as the mortgage modification program. Instead of allowing oneself to become overwhelmed with monthly bills, it may be worth looking into a consolidation loan. When traditional banks are no longer an option, a private lender can still help. They cater to clients with bad credit in almost any financial situation.

If you are trying to pay off debt this year, but are struggling to make your many payments, a debt consolidation loan can help. If you have bad credit, visit our Bad Credit Loans website today, for more information on our debt consolidation loans! Visit our blog for more articles about Bad Credit and Debt.

Author: Molly Wider
Article Source: EzineArticles.com
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The Cash for Keys Deal with Foreclosures

REO Asset Management No Responses »

Jul 292010

Banks have noticed a rather significant problem when they foreclose on homeowners. More and more of the homes are being trashed by the owners before they move out. Banks are now fighting back in an odd way. They are offering cash to owners that move out peacefully.

The foreclosure situation is such that there are a lot of unhappy parties. Most homeowners, for instance, don’t even know who own their mortgages. The lack of personal touch leaves many people incredibly frustrated. Given the impersonal nature of the situation, foreclosed upon individuals go for revenge and trash the homes on the way out.

There are different types of damage being done. The classic is to let the pets into the home. They eat and need somewhere to defecate. You guessed it. In the home. At a minimum, the carpets need to be replaced and it can take time for the smell to go away.

Another classic damage strategy involves water abuse. People plug up the drains, turn on the water and head out the door. As the water overflows, nobody really notices for a day or so. This effectively ruins the carpets, ceilings between floors and so on. In short, it is a mess.

Some lenders are taking a very unique approach to deal with the situation. They are now offering the homeowners cold, hard cash not to trash the home when moving out. The payments range between a couple hundred bucks to significantly more depending on the home and the area.

Certain experts have opined that the real estate market in the United States has been completely out of control for many years. If ever there was proof of this opinion, it is this situation. Think about it for a minute. Lenders are paying homeowners who have defaulted on mortgage loans to move out of the property without damaging it. That single sentence and what it represents should just about give you a pounding headache.

It certainly is an indication of the mess we see in the housing markets.

Raynor James writes about issues surrounding FSBO properties for FSBOAmerica.org where you can list your home for sale by owner for free for 1 month.

Author: Raynor James
Article Source: EzineArticles.com
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The Contribution to Property Preservation

Property Preservation Training No Responses »

Jul 292010

The mortgage crisis is causing economic grief nationwide. Foreclosures are at an all time high causing property values to decrease and the collapse of Fannie Mae and Freddie Mac to continue its course. Government agencies and institutions are collaborating to find a solution to this highly volatile situation. However, it is difficult to forecast the market’s future with other facets contributing to the slope of the market’s conditions.

A property’s condition can be a major contributing factor to a property’s value. With the foreclosure market increasing, more homeowners are neglecting their properties with the attitude that they have nothing left to invest in the property. Therefore, keeping the property in good condition is no longer worth their efforts. When this happens, the home is generally worth less, due to any damages or mishaps that may have resulted in the previous homeowners’ disregard for the property.

Lenders, investors, and institutions that hold mortgages are doing their best to preserve property values. They usually call upon the help of companies or contractors that routinely preserve and maintain the properties until they are sold.

Property preservation is soaring with business. The idea is to rehabilitate the properties in order to prepare them for future sales. Guidelines are set based on the requirements regulated by the U.S. Department of Housing and Urban Development (HUD). These guidelines ensure the buyer of the marketability and value of the property’s conveyance condition.

HUD requirements involving the property’s conveyance condition include: title clearance, property cleared from occupancy, property is properly secured with proper lock codes and board-ups, all safety grounds secured including pools, spas, and such, property is properly winterized, lawn meets city code requirements, debris and all personal property removed, property is clear from any citations or code violations, and the property is clear from any major damages such as fire, earthquake, tornado, etc.

The cost to repair and/or maintain properties are added to the cost of declining property values. Therefore, it may not be of any further benefit to keep a property in good condition, if you are no longer going to live in it. However, as part of a society that contributes to the well-being of that society through taxes and other efforts, little attempts by a pair of hands can contribute to a significant amount of good.

Karlyn Katigbak has had years of experience working in different arenas of the mortgage industry from real estate and mortgage sales to processing, underwriting, and making due diligence decisions in the secondary market. She is currently one of the owners of a company that specializes in helping with the rehabilitation of properties during our current foreclosure crisis. In addition, Karlyn also spends a lot of her free time helping borrowers find an alternative to foreclosure [http://www.myloannegotiator.net] as well as finding homes for investors and future homeowners.

Author: Karlyn Katigbak
Article Source: EzineArticles.com
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Waiting For the Man Offering Cash For Keys - Trends in Our Foreclosure Market

REO Asset Management No Responses »

Jul 282010

We all know the story of our real estate market and the staggering foreclosure statistics here in Arizona. Today someone mentioned that a new trend has evolved with foreclosed homes and the occupants within. This trend involves people waiting anxiously for someone to knock on their door and offer them cash for keys, a standard lender practice to get houses vacated in a timely manner, so they can move on with the business at hand of selling the house as quickly as possible. Since we have laws and rights, it can take up to three months to go through the court systems to evict a person or family from a bank owned home, so the option of offering them cash to vacate within a certain time frame seems prudent and cost effective.

There was a time, when this whole real estate market began to unravel and folks didn’t understand the concept of Cash For Keys. In fact, it was not uncommon for people to hide from the agents coming to their door to offer a stipend to move out in X amount of days. It was also not uncommon to have a very hostile, defensive person answer the door and threaten you with looks, words, or an occasional pitch fork! We have come a long way since those times. At this point, most people who have decided to, or have been forced into foreclosure know the ropes. This thing has been around for a while now and everyone from the news casters to your old neighbor Bob can tell you how things are going to go down.

So now people wait for you to offer cash for keys. Is that okay? Well, I think it is! It has been offered all along if the house is occupied, and those who stay, don’t really have it all that easy. Let’s look at the big picture. Your house is going back to the bank. Whether you loved your home and your heart is broken or it is a business decision, it is an emotional experience and you are going to suffer the consequences of your actions for years to come. Want to rent? Why would I rent to you when you let your very own home go? Okay, that statement is not exactly true because investors have adapted to the market and swooped up discounted properties by the hundreds to rent out to people in just this circumstance. However, you have to prove credit worthy in other areas of your life, provide proof of income and sometimes write out or explain why you are in this predicament.

Besides, wouldn’t you rather have someone waiting in anticipation for you to arrive, over waiting with the curtains drawn for the ax to fall? I have slowly stepped backwards out of several driveways away from hostile occupants and personally prefer the first option! So there we have it, yet another sign of the times. Advancement in foreclosure procedure? In my book a resounding YES!

Judi Boad lives in Scottsdale and is part of ACCURATE REALTY GROUP. We have a team of professionals ready to assist you with all your real estate needs. Go to our easy to navigate website to view the most current information on all Scottsdale homes for sale:

http://www.accuraterealtygroup.com/74913-Scottsdale-AZ-RESCity.aspx. Get more info on Scottsdale communities by going to http://judisaccurateblog.com/

ACCURATE REALTY GROUP – “Guiding you in the right direction”

Author: Judi Boad
Article Source: EzineArticles.com
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A Solution to the "Mancession" - The Property Preservation Business Opportunity

Property Preservation Training No Responses »

Jul 282010

Foreclosure Clean Outs Will Be the Big Business for Some Time to Come

At the beginning of 2010, the unemployment outlook continues to be bleak – 85,000 more jobs were lost in December of 2009 and the joblessness rate won’t budge below 10%. Not only that, but 661,000 Americans just plain gave up looking for work at all.

Working-age men, however, have been hit hardest of all. Economists have termed this recession a “mancession,” because figures state that the jobless rate for this group is closer to 20% – with just about one out of five males 25-54 unemployed.

The good news is that there are still business opportunities out there, for those willing to give a new skill category a shot. And one of the hottest job categories right now is property preservation.

Property preservation – also known as mortgage field services – involves performing foreclosure trash outs, repairs and doing ongoing maintenance, and is truly the biggest business opportunity in this climate of ever-increasing home foreclosures.

The foreclosure situation, like the unemployment problem, is not expected to improve soon. As a matter of fact, the rising joblessness is helping to continue to fuel foreclosures – experts predict over 10 million of them over the next 2 years, an incredibly high figure.

When a home is hit with foreclosure, the ownership reverts to the bank or financial institution which holds the unpaid mortgage. These kinds of home are frequently left in horrible shape – and the banks must hire companies to perform what are called “trash outs” to clean out the homes, which are often still filled with the previous homeowner’s possessions. In addition, homes must be re-keyed and secured, so no vandalism will take place, and certain maintenance, such as winterization and pool draining and covering, must be performed to keep the homes safe and habitable.

Property preservation work is essential to banks and financial institutions, as it allows them to resell the homes as REO properties, currently one of the biggest-selling sectors of the real estate business. Many start-ups in the mortgage field services industry have found themselves working Monday through Saturday, 12 hours a day, trying to keep up with the demand – and finding themselves making up to $60,000 a month.

$60,000 a month – especially in this economy – is certainly an amazing number. And that’s because the need for property preservation companies is so great.

In difficult times such as these, an incredible business opportunity like property preservation should be considered.

Author: Frank Patrick
Article Source: EzineArticles.com
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Cash For Keys Offers Used to Persuade Foreclosure Victims to Leave Homes Peacefully

REO Asset Management No Responses »

Jul 272010

Banks are beginning to rely more and more on a unique method of bribing homeowners to leave a foreclosed property without causing damage to the house. For a few thousand dollars, banks attempt to persuade foreclosure victims to leave the house without having to be evicted, and without ripping out any of the fixtures or making the house unlivable. Homeowners with no other option to save their home may wish to consider this offer from the bank, which is called a cash for keys offer.

Local real estate agents or home inspectors are often the representatives that the banks hire to provide these kinds of offers to homeowners. They are not directly affiliated with the mortgage companies, and are not working for the owners, so they are inserted into the foreclosure process as a third-party which can help negotiate a deal. The homeowners will receive a small sum of money, which they can use for moving expenses or a security deposit on a new apartment or rental home, while the bank gets the property free of any undue damage or theft.

Banks are beginning to offer more of these kinds of deals in response to the “buyer’s revenge” syndrome that some foreclosure victims engage in before being kicked out of a house. By the time the sheriff gets into the house and the bank has the locks changed, the former owners may have taken all the appliances, stripped the copper pipes to sell for scrap, damaged walls, dumped hazardous materials on the floors, ripped up carpets, or let pets and animals into the house to cause even more damage. Obviously, homes in this condition are nearly unsaleable, and will have to be listed on the market with the severe defects taken into account in the asking price.

Thus, banks have realized that it costs them more in lost sales revenue than it does simply to bribe the homeowners into leaving with no extra troubles. Houses in many markets will sit for months unoccupied, which will contribute to the deterioration of the building, even without extra destruction caused by soon to be evicted former homeowners. If the banks can put a few thousand dollars into the pockets of foreclosure victims in return for a house in as good of condition as possible, then all of the parties will benefit even slightly.

Destruction to a home after failing to stop foreclosure will not help the former owners or the bank. Homeowners are usually protected against the consequences of their actions, though, because banks rarely sue for the damage caused to the house. They know that foreclosure victims will not be able to pay off the judgments anyway, and they are finding that it costs less to offer a cash for keys deal to attempt to prevent any extra damage to their new REO property.

Of course, knowing that banks do not want damaged houses, homeowners are able to negotiate for a higher payout to leave the property in good condition. While most banks will offer a few hundred dollars, other pay more than a couple thousand to ensure that the home will be left undamaged. Obviously, homeowners should not be engaging in blackmail to the banks in order to get more money to leave, but a fair cash for keys deal can benefit both the banks and the owners. Pursuing the eviction process can be expensive and time-consuming; both banks and homeowners have something the other can bargain for. Banks want a clean property, and homeowners want an incentive not to take out their frustration on a property that is no longer theirs.

The ForeclosureFish website has been created to help homeowners in danger of losing their houses stop foreclosure and recover from the process afterwards. The site describes various methods that may be used to save a home, such as foreclosure refinancing, loan modification, short sales, deed in lieu, and more. Visit the site to read more articles about how foreclosure works and how the process may be avoided before it is too late: http://www.foreclosurefish.com/

Author: Nick Adama
Article Source: EzineArticles.com
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More Government Action - More Property Preservation

Property Preservation Training No Responses »

Jul 272010

Colorado Community the Latest to Advocate Controlling Vacant Foreclosures

As more and more foreclosed homes are left vacant and in bureaucratic limbo, more and more neighborhoods and communities all across America are facing the health, safety and social hazards presented by these unsecured, uncared-for properties, which continue to deteriorate.

Property preservation companies are traditionally called in when these homes are classified as REO (Real Estate Owned) properties, in order to prepare them for resale on the real estate market. These mortgage field service businesses will perform a foreclosure clean out, make necessary repairs, do the landscaping and also carry out necessary maintenance.

The incredible overload of foreclosed and abandoned houses should make property preservation the biggest business opportunity around. As it is, contractors who specialize in this niche are incredibly overloaded with work and making a lucrative living while other occupations suffer at the hands of the currently-dismal economy. Still, the fact is that more houses need immediate tending to prevent neighborhoods from falling into potential disarray – and the Federal Government has been slow to do anything about it.

That’s why Aurora, Colorado is the latest local government to try and act on this growing dilemma.

In April of 2009, the Aurora City Council passed a foreclosure ordinance that charged lenders to register foreclosed properties. The initial fee is $50, but that amount increases by $150 for every 90 days the lender fails to register the property. Any unpaid fees are simply added to the tax bill for the property – in addition to a city and council processing fee of 26.5 percent of the amount owed.

That’s meant a bonanza for the city – and much-needed help for local neighborhoods hard hit by foreclosures in recent years. In the past five months, the new law has created almost $100,000 in new revenues in the city from the over 1500 foreclosed properties registered to date. Not only that, but Neighborhood Services Department staff says property preservation services have been much more in evidence.

“Our code officers report back to us that they feel like the vacant properties that they see on the street every day tend to be a little bit better maintained,” declared Neighborhood Services worker Jeff Hancock during a presentation in November.

As more and more counties and communities like Aurora work to fix the foreclosure problem, property preservation experts will be more in demand than they already are, truly making it the biggest foreclosure business opportunity available.

Author: Frank Patrick
Article Source: EzineArticles.com
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