Las Vegas Luxury Properties Link

Las Vegas Luxury foreclosures and short sales are not quite as common as foreclosures in lower price ranges, but for a lucky few the deals are quite impressive.   Las Vegas has seen a huge hit in our home real estate market, some areas as much as 65% depreciation.  The luxury market is not immune to the affects of the real estate market either, however they are somewhat insulated. What is the major difference between a short sale and a foreclosure?  A short sale is when a seller is trying to sell their property for less than what they owe on it.  This process can take anywhere from 60-180 days for the bank to approval the sale of the property.   A foreclosure is when the bank has taken ownership of the property through the foreclosure process.   You can read more about short selling by visiting http://www.LasVegasShortSaleConnection.com.  With luxury homes, the short sale process can be a little long and frustrating for buyers, but the benefits can far outweigh the negatives.  If you'd a control freak like me, a short sale might drive you bonkers, but some of these prices are unbelievable.

Currently, there are 29 homes over $1 million that are in short sale status in the multiple listing service in Las Vegas.   There are 14 properties that are over $1 million that are bank owned or foreclosed homes.  One in particular is a property on 634 St. Croix.  This property is massive!  Over 12000 sq ft, with 6 bedrooms, 7 baths, a theater room, pool and spa, overlooking the golf course in Macdonald Ranch Foothills.  Such a stunning property that is bank owned! Take a look at a few of these pictures:

There are currently 29 properties over $1 million that are short sales:

There are currently 14 properties over $1 million that are foreclosures:

If you would like information on any of the properties listed above, please contact me toll free at 1-866-589-1646.  Remember, buyer representation is FREE and I would be happy to help you anyway I can.  

Felipe Crook

Prudential Americana Group Realtors

Certified Short Sale Professional

Las Vegas, Nevada 89117

1-866-589-1646

The following is the text of details provided by the Obama administration Friday of its plans to enhance the Home Affordable Modification Program in order to provide more help to homeowners:

1. Temporary Assistance for Unemployed Homeowners While They Search for Re-Employment

- Mortgage payments reduced to an affordable level for a minimum of 3 months, and up to six months for some borrowers, while eligible homeowner looks for new job.

* Payment set at 31 percent of monthly income or less while homeowner is unemployed via forbearance plan.

* Temporary assistance plan offered for a minimum of 3 months, and up to six months for some borrowers, subject to investor and regulator guidelines, ending when borrower becomes re-employed or scheduled assistance period expires. Borrowers who become re-employed during the scheduled assistance period and whose mortgage payment is greater than 31 percent of their new gross monthly income must be considered for HAMP.

- Servicers participating in the Making Home Affordable Program are required to offer assistance to all unemployed borrowers who meet eligibility criteria:

* Homeowners mortgage meets HAMP eligibility requirements, including 1) house is owner-occupied 2) loan balance is below $729,750 and 3) loan was originated before January 1, 2009.

* Borrower submits evidence that they are receiving unemployment insurance (UI) benefits.

* Borrower requests temporary assistance in the first 90 days of delinquency.

- At the end of the temporary assistance period, homeowners who have a mortgage payment greater than 31 percent of their monthly income must be considered for a permanent HAMP modification.

* To receive the permanent HAMP modification, homeowners must be current on assistance plan payments, must verify qualifying income with standard documentation, and must meet all other HAMP underwriting requirements including the net present value (NPV) evaluation.

* Unemployment insurance will not be counted as income when homeowner is evaluated for HAMP.

* If the scheduled assistance period ends without re-employment, the homeowner may be considered for HAMP alternatives to foreclosure including short sales and deed-in-lieu of foreclosure.

- No cost to government or taxpayers from the forbearance plans.

2. Requirement to Consider Alternative Principal Write-down Approach and Increased Principal Write-down Incentives

- Requirement for all servicers to consider an alternative modification approach including more principal write down for HAMP-eligible borrowers that owe more than 115 percent of the current value of their home.

* Servicers will be required to run the standard NPV and an alternative NPV that includes incentives for principal write-down and compare the results.

* If NPV is higher under alternative approach, servicer will have option to use it.

- Alternative principal reduction allows some underwater homeowners to reduce principal balance of their mortgage in steps over three years, if they remain current on payments.

* Under alternative approach, servicers assess the NPV of a modification that starts by forbearing principal balance as needed over 115 percent loan-to-value (LTV) to bring borrower payments to 31 percent of income; if a 31 percent monthly payment is not reached by forbearing principal to 115 percent LTV, the servicer will then use standard steps of lowering rate, extending term, and forbearing additional principal.

* Servicers will initially treat the write-down amount as forbearance and will forgive the forborne amount in three equal steps over three years, as long as the homeowner remains current on payments. o Additional guidance will address the treatment of second liens where applicable, which must also agree to first extinguish principal in conjunction with any principal reduction on the first lien.

- For borrowers who have already received a permanent modification, or who are in a trial modification, and are still current on payments at the time the alternative modification approach is operational (later in 2010), servicers will be required to retroactively consider extinguishing an amount of principal balance in the same amount that would have been forgiven under the new alternative approach.

* To further encourage principal write-downs, Treasury is also increasing the incentives that it provides for loans extinguished or partially extinguished in conjunction with the HAMP Second Lien Program.

* The following schedule will be available to lenders in exchange for all principal write-downs under HAMP at the time of a loan modification.

3. Improvements to Reach More Borrowers with HAMP Modifications

- Improve borrower solicitation and communication and expand opportunities for borrowers in bankruptcy

* Clarifies borrower solicitation requirements and defines "reasonable effort" on the part of the servicer to outreach to borrowers.

-- Encourages early intervention by requiring pro-active solicitation of all borrowers who meet the HAMP eligibility profile and have missed two or more payments.

-- Establishes minimum solicitation requirements that include both phone and mail attempts.

* Prohibits referral to foreclosure until a borrower is evaluated and found ineligible for HAMP or reasonable contact efforts have failed, protecting responsible borrowers from unnecessary foreclosure actions and costs.

* Requires servicers to stop foreclosure actions after a borrower enters into a trial plan based on verified income.

* Requires written certification that a borrower is not HAMP eligible before an attorney or trustee can conduct a foreclosure sale.

* Establishes a 30-day borrower response period from the date of a non-approval notice during which foreclosure sale is prohibited. o Requires servicers to consider borrowers in bankruptcy for HAMP and removes barriers to HAMP evaluation.

-- Allows use of bankruptcy documents to verify income.

-- Allows waiver of the trial period in some cases were a borrower is already performing under a bankruptcy plan.

- Increase incentives for servicers to provide permanent modifications to homeowners

* Upfront servicer incentive payments increased for permanent modification to allow servicers to increase outreach and counseling efforts and to cover costs of implementing the updated program elements.

- Implement FHA-HAMP, expansion of HAMP to include homeowners with FHA loans.

* TARP funded incentives will be available to borrowers and servicers whose loans are modified under the FHA-HAMP guidelines. The incentives are comparable to the incentive structure of HAMP.

* FHA-HAMP provides FHA insured borrowers with modified mortgage payments set at 31 percent of gross monthly income, similar to a HAMP modification. o To be eligible for FHA-HAMP incentives, servicers must sign an agreement with Treasury.

4. Helping Homeowners Move to More Affordable Housing

- Increase incentives to provide more homeowners with foreclosure alternatives

* Increase payoffs to subordinate lien holders who agree to release borrowers from debt to facilitate greater use of foreclosure alternatives including short sales or deeds-in-lieu.

-- The new payoff schedule allows servicers to increase the maximum payoff to subordinate lien holders to 6 percent of the outstanding loan balance and doubles from $1,000 to $2,000 the incentive reimbursement that is available to investors for subordinate lien payoffs, subject to an overall cap of $6,000.

* Increase servicer incentive payments from $1,000 to $1,500 to increase use of foreclosure alternatives and encourage additional outreach to homeowners unable to complete a modification.

- Double relocation assistance payment for borrowers successfully completing foreclosure alternative to $3,000 o Help homeowners who use a short sale or deed-in-lieu to transition more quickly to housing they can afford.

Here are what some opponent's are saying about the HAMP program:

• "HAMP modifications are not well-suited to address many cases where homeowners have suffered a large temporary decline in income, as might be the result of job loss. In particular, because the modification calls for a reduction in the ratio of payments to income based on the current level of income, a reduction that would not be reversed if income were to return to its previous level, the required modification in such cases will often be too costly to qualify the program."
• "In addition, the program may not be very effective when the value of the mortgage greatly exceeds the value of the home. Some borrowers who believe that there is little prospect for house prices to recover enough to put the mortgage "above water" within some reasonable period of time will not participate in the program and instead walk away from their mortgages. Worse yet, other borrowers may shift beliefs only after entering the program; these borrowers are likely to default after many of the costs associated with the modification have already been borne."

Recent Articles about possible problems with HAMP:

• Brookings Institute article about HAMP Program
• The Truth about HAMP

There have been success stories involving the HAMP program....although not as many as the OBAMA Administration would like to see:

Mortgage Payment $2430

First missed payment: September (struggling every month but current through August)
Accepted into HAMP: October 20
Trial Period: December - February
Trial Payment: $2160

Financial Worksheet: $225 DEFICIT before mod (they never dug into this fortunately because it would be higher if ALL monthly expenses were included, not just the categories on the sheet)
Back End Debt Ratio: 95%
Front End Debt Ratio 58%

MODIFICATION DETAILS:
Approval Agreement received on March 19
Permanent Payment: $1779 (includes $37/mo for catching up escrow shortage) Monthly savings of $68

• Wells Fargo Success Story for HAMP
• Homeowner Fought Back and Lives in Home for 11year payment free!

Being in Las Vegas, one of the most difficult situations home owners are having to deal with is how upside down we are.  Since the peak of our market in 2006, our prices have been hammered by 60-65% in most areas.   The idea that an FHA loan would allow you to refinance if you are 115% underwater is a joke to Las Vegans.  The most exciting part of the changes comes in the form of principle reductions.  If the government and banks can work together to forgive principle balances, then our housing market would start to truly see a recovery.   Banks should follow the lead of Bank of America which announced recently that they would start to reduce principle balances:

• Bank of America to reduce principle mortgage balances

Here is how the Bank of America program will work:

1. If you have a pay option ARM the bank will first look at your negative amortization account. With these loans borrowers were able to defer interest payments and these payments are held in negative amortization accounts. As part of the HAMP modification, the bank will eliminate this feature and forgive all or part of the negative amortization to reduce principal to as low as 95% loan to value (LTV).
2. Also, pay option ARMs will be recast to eliminate the negative amortization and converted to fully amortizing loans.
3. Next if the principal balance of the loan is greater than 120% LTV the bank will consider a set-aside of up to 30% of the principal as an "interest-free forbearance of principal." The amount set aside interest-free will be eligible for possible forgiveness.
4. In addition to pay option ARMs, some prime two-year hybrids and Countrywide mortgages will be included in this program.
5. As long as you pay your loan on time during a five year period, it's possible all the interest-free principal that was set aside will be forgiven. Whether or not all is forgiven will depend on the value of your home in the fourth and fifth year.

•  Read the full article in Bank of America Mortgage Forgiveness Article

Obama is doing his part as well:

The revamp also will require banks to consider writing down loan balances as part of the formula for lowering monthly payments under the federal Home Affordable Modification Program, or HAMP. That program, which is voluntary, is currently designed to lower monthly payments mostly by cutting interest rates to as low as 2% or extending terms to 40 years. Both banks and borrowers get federal incentive payments under the $50 billion program. 

• Wall Street Journal article about reducing principle
• http://www.dsnews.com/articles/white-house-to-announce-plans-cut-mortgage-principals-2010-03-25

If you have tried the HAMP or HAFA program and have decided to short sell your home, please give me a call toll free at 1-866-589-1646.  All your information is strictly confidential.

Felipe Crook

Prudential Americana Group Realtors

Las Vegas, NV 89117

1-866-589-1646

We're number 1, we're number 1....in up-side-down mortgages. Again, not the thing you really want to be leading the nation with, but that's our market right now.  There is a great report just released from First American CoreLogic on the Fourth Quarter housing statistics.  Over 11.3 million mortgages are under water.  Nevada seems to be the epicenter of the housing meltdown, even though prices have stabilized, the numbers are surprising. Here's an excerpt from the report:

 Negative equity continues to be concentrated in five states: Nevada, which had the highest percentage negative equity with 70 percent of all of its mortgaged properties underwater, followed by Arizona (51 percent), Florida (48 percent), Michigan (39 percent) and California (35 percent). Among the top five states, the average negative equity share was 42 percent, compared to 15 percent for the remaining 45 states. In numerical terms, California (2.4 million) and Florida (2.2 million) had the largest number of negative equity mortgages accounting for 4.6million, or 41 percent, of all negative equity loans.

The blog "Calculated Risk Blog" reported:

These homeowners are far more likely to default.

The rise in negative equity is closely tied to increases in pre‐foreclosure activity and is a major factor in changing homeowners' default behavior. Once negative equity exceeds 25 percent, or the mortgage balance is $70,000 higher than the current property values, owners begin to default with the same propensity as investors.

 Here is figure 4 from the report.

The default rate increases sharply for homeowners with more than 20% negative equity.

This graph fits with figure 2 above and suggests a large number of future defaults in Nevada, Arizona, Florida and California.

The aggregate dollar value of negative equity was $801 billion, up $55 billion from $746 billion in Q3 2009. The average negative equity for an underwater borrower in Q4 was ‐$70,700, up from ‐$69,700 in Q3 2009. The segment of borrowers that are 25 percent or more in negative equity account for over $660 billion in aggregate negative equity.

Because Nevada is SO upside down, loan modification programs, and short sales have taken over our market.  Out of the 10,135 Single Family Homes, Townhouses, and Condos that are currently available on the multiple listing service in Las Vegas/Henderson, 4900 are short sales, and 1550 are foreclosures or bank owned properties.    Banks are now on board the short sale wagon.  They want to work with sellers to avoid foreclosure.  Bank of America, one of the most notorious banks in the short sale world, is the first large bank to sign on for the Second Lein Holders program-H.A.M.P. (Housing Affordable Modification Program).  If you'd like more information regarding a loan modification, please visit Making Home Afforable.   These programs also facilitate the short sale process.  Some of these programs do seem to be making a difference.  Short sale closings have increased to 22% of all home sales in January 2010.

If you would like a FREE, confidential short sale consultation, please give me a call toll free at 1-866-589-1646.  We're here to help you avoid foreclosure, get a loan modification, or assist you to short sale your home.  Certified Short Sale Professional and Certified Distressed Property Experts handle every aspect of your short sale.

Felipe Crook

Prudential Americana Group Realtors

Las Vegas, NV 89117

1-866-589-1646

I just saw some great information on THE FEDERAL TRADE COMMISSION's website about mortgages, short sales, loan modifications, and foreclosures for the consumer.   It goes over all kinds of scenarios and options people have if they are struggling with their mortgages.  This is a copy from their website. The full article is available by clicking here, or you can read below:

"Mortgage Payments Sending You Reeling? Here's What to Do

The possibility of losing your home because you can't make the mortgage payments can be terrifying. Perhaps you're having trouble making ends meet because you or a family member lost a job, or you're having other financial problems. Or maybe you're one of the many consumers who took out a mortgage that had a fixed rate for the first two or three years and then had an adjustable rate - and you want to know what your payments will be and whether you'll be able to make them.

Regardless of the reason for your mortgage anxiety, the Federal Trade Commission (FTC), the nation's consumer protection agency, wants you to know how to help save your home, and how to recognize and avoid foreclosure scams.

Know Your Mortgage

Do you know what kind of mortgage you have? Do you know whether your payments are going to increase? If you can't tell by reading the mortgage documents you received at settlement, contact your loan servicer and ask. A loan servicer is responsible for collecting your monthly loan payments and crediting your account.

Here are some examples of types of mortgages:

• Hybrid Adjustable Rate Mortgages (ARMs): Mortgages that have fixed payments for a few years, and then turn into adjustable loans. Some are called 2/28 or 3/27 hybrid ARMs: the first number refers to the years the loan has a fixed rate and the second number refers to the years the loan has an adjustable rate. Others are 5/1 or 3/1 hybrid ARMs: the first number refers to the years the loan has a fixed rate, and the second number refers to how often the rate changes. In a 3/1 hybrid ARM, for example, the interest rate is fixed for three years, then adjusts every year thereafter.
• ARMs: Mortgages that have adjustable rates from the start, which means your payments change over time.
• Fixed Rate Mortgages: Mortgages where the rate is fixed for the life of the loan; the only change in your payment would result from changes in your taxes and insurance if you have an escrow account with your loan servicer.

If you have a hybrid ARM or an ARM and the payments will increase - and you have trouble making the increased payments - find out if you can refinance to a fixed-rate loan. Review your contract first, checking for prepayment penalties. Many ARMs carry prepayment penalties that force borrowers to come up with thousands of dollars if they decide to refinance within the first few years of the loan. If you're planning to sell soon after your adjustment, refinancing may not be worth the cost. But if you're planning to stay in your home for a while, a fixed-rate mortgage might be the way to go. Online calculators can help you determine your costs and payments.

If You're Behind On Your Payments

If you are having trouble making your payments, contact your loan servicer to discuss your options as early as you can. The longer you wait to call, the fewer options you will have.

Many loan servicers are expanding the options available to borrowers - it's worth calling your servicer even if your request has been turned down before. Servicers are getting lots of calls: Be patient, and be persistent if you don't reach your servicer on the first try.

• You may qualify for a loan modification under the Making Home Affordable Modification Program (HAMP) if:
• your home is your primary residence;
• you owe less than $729,750 on your first mortgage;
• you got your mortgage before January 1, 2009;
• your payment on your first mortgage (including principal, interest, taxes, insurance and homeowner's association dues, if applicable) is more than 31 percent of your current gross income; and
• you can't afford your mortgage payment because of a financial hardship, like a job loss or medical bills.

If you meet these qualifications, contact your servicer. You will need to provide documentation that may include:

• information about the monthly gross (before tax) income of your household, including recent pay stubs.
• your most recent income tax return.
• information about your savings and other assets.
• your monthly mortgage statement.
• information about any second mortgage or home equity line of credit on your home.
• account balances and minimum monthly payments due on your credit cards.
• account balances and monthly payments on your other debts, like student loans or car loans.
• a completed Hardship Affidavit describing the circumstances responsible for the decrease in your income or the increase in your expenses.

For more information, see www.makinghomeaffordable.gov/modification_eligibility.html

If you're interested in refinancing to take advantage of lower mortgage rates, but are afraid you won't qualify because your home value has decreased, you may want to ask if you qualify for the Home Affordable Refinance Program (HARP) or the HOPE for Homeowners (H4H) program. For more information, see www.hud.gov/foreclosure.

Avoiding Default and Foreclosure

If you have fallen behind on your payments, consider discussing the following foreclosure prevention options with your loan servicer:
Reinstatement: You pay the loan servicer the entire past-due amount, plus any late fees or penalties, by a date you both agree to. This option may be appropriate if your problem paying your mortgage is temporary.

Repayment plan: Your servicer gives you a fixed amount of time to repay the amount you are behind by adding a portion of what is past due to your regular payment. This option may be appropriate if you've missed a small number of payments.

Forbearance: Your mortgage payments are reduced or suspended for a period you and your servicer agree to. At the end of that time, you resume making your regular payments as well as a lump sum payment or additional partial payments for a number of months to bring the loan current. Forbearance may be an option if your income is reduced temporarily (for example, you are on disability leave from a job, and you expect to go back to your full time position shortly). Forbearance isn't going to help you if you're in a home you can't afford.

Loan modification: You and your loan servicer agree to permanently change one or more of the terms of the mortgage contract to make your payments more manageable for you. Modifications may include reducing the interest rate, extending the term of the loan, or adding missed payments to the loan balance. A modification also may involve reducing the amount of money you owe on your primary residence by forgiving, or cancelling, a portion of the mortgage debt. Under the Mortgage Forgiveness Debt Relief Act of 2007, the forgiven debt may be excluded from income when calculating the federal taxes you owe, but it still must be reported on your federal tax return. For more information, see www.irs.gov. A loan modification may be necessary if you are facing a long-term reduction in your income or increased payments on an ARM.

Before you ask for forbearance or a loan modification, be prepared to show that you are making a good-faith effort to pay your mortgage. For example, if you can show that you've reduced other expenses, your loan servicer may be more likely to negotiate with you.

Selling your home: Depending on the real estate market in your area, selling your home may provide the funds you need to pay off your current mortgage debt in full.

Bankruptcy: Personal bankruptcy generally is considered the debt management option of last resort because the results are long-lasting and far-reaching. A bankruptcy stays on your credit report for 10 years, and can make it difficult to get credit, buy another home, get life insurance, or sometimes, get a job. Still, it is a legal procedure that can offer a fresh start for people who can't satisfy their debts.
If you and your loan servicer cannot agree on a repayment plan or other remedy, you may want to investigate filing Chapter 13 bankruptcy. If you have a regular income, Chapter 13 may allow you to keep property, like a mortgaged house or car, that you might otherwise lose. In Chapter 13, the court approves a repayment plan that allows you to use your future income toward payment of your debts during a three-to-five-year period, rather than surrender the property. After you have made all the payments under the plan, you receive a discharge of certain debts.

To learn more about Chapter 13, visit www.usdoj.gov/ust; it's the website of the U.S. Trustee Program, the organization within the U.S. Department of Justice that oversees bankruptcy cases and trustees.

If you have a mortgage through the Federal Housing Administration (FHA) or Veterans Administration (VA), you may have other foreclosure alternatives. Contact the FHA (www.fha.gov) or VA (www.homeloans.va.gov) to talk about them.

Contacting Your Loan Servicer

Before you have any conversation with your loan servicer, prepare. Record your income and expenses, and calculate the equity in your home. To calculate the equity, estimate the market value less the balance of your first and any second mortgage or home equity loan.

Then, write down the answers to the following questions:

• What happened to make you miss your mortgage payment(s)? Do you have any documents to back up your explanation for falling behind? How have you tried to resolve the problem?
• Is your problem temporary, long-term, or permanent? What changes in your situation do you see in the short term, and in the long term? What other financial issues may be stopping you from getting back on track with your mortgage?
• What would you like to see happen? Do you want to keep the home? What type of payment arrangement would be feasible for you?

Throughout the foreclosure prevention process:

• Keep notes of all your communications with the servicer, including date and time of contact, the nature of the contact (face-to-face, by phone, email, fax or postal mail), the name of the representative, and the outcome.
• Follow up any oral requests you make with a letter to the servicer. Send your letter by certified mail, "return receipt requested," so you can document what the servicer received. Keep copies of your letter and any enclosures.
• Meet all deadlines the servicer gives you.
• Stay in your home during the process, since you may not qualify for certain types of assistance if you move out. Renting your home will change it from a primary residence to an investment property. Most likely, it will disqualify you for any additional "workout" assistance from the servicer. If you choose this route, be sure the rental income is enough to help you get and keep your loan current.

Housing and Credit Counseling

You don't have to go through the foreclosure prevention process alone. A counselor with a housing counseling agency can assess your situation, answer your questions, go over your options, prioritize your debts, and help you prepare for discussions with your loan servicer. Housing counseling services usually are free or low cost.

While some agencies limit their counseling services to homeowners with FHA mortgages, many others offer free help to any homeowner who is having trouble making mortgage payments. Call the local office of the U.S. Department of Housing and Urban Development (www.hud.gov) or the housing authority in your state, city, or county for help in finding a legitimate housing counseling agency nearby. Or consider contacting the Homeownership Preservation Foundation (HPF) at 888-995-HOPE or www.hopenow.com. HPF is a nonprofit organization that partners with mortgage companies, local governments, and other organizations to help consumers get loan modifications and prevent foreclosures.

When choosing a counselor, beware of anyone charging large up-front fees or guaranteeing you a loan modification or other solution to stop foreclosure. They shouldn't be charging you high fees or making any guarantees. Take your business elsewhere.

Consider Giving Up Your Home Without Foreclosure

Not every situation can be resolved through your loan servicer's foreclosure prevention programs. If you're not able to keep your home, or if you don't want to keep it, consider:

Selling Your House: Your servicers might postpone foreclosure proceedings if you have a pending sales contract or if you put your home on the market. This approach works if proceeds from the sale can pay off the entire loan balance plus the expenses connected to selling the home (for example, real estate agent fees). Such a sale would allow you to avoid late and legal fees and damage to your credit rating, and protect your equity in the property.

Short Sale: Your servicers may allow you to sell the home yourself before it forecloses on the property, agreeing to forgive any shortfall between the sale price and the mortgage balance. This approach avoids a damaging foreclosure entry on your credit report. Under the Mortgage Forgiveness Debt Relief Act of 2007, the forgiven debt on your primary residence may be excluded from income when calculating the federal taxes you owe, but it still must be reported on your federal tax return. For more information, see www.irs.gov, and consider consulting a financial advisor, accountant, or attorney.

Deed in Lieu of Foreclosure: You voluntarily transfer your property title to the servicers (with the servicer's agreement) in exchange for cancellation of the remainder of your debt. Though you lose the home, a deed in lieu of foreclosure can be less damaging to your credit than a foreclosure. You will lose any equity in the property, although under the Mortgage Forgiveness Debt Relief Act of 2007, the forgiven debt on your primary residence may be excluded from income when calculating the federal taxes you owe. However, it still must be reported on your federal tax return. For more information, see www.irs.gov. A deed in lieu of foreclosure may not be an option for you if other loans or obligations are secured by your home.

Be Alert to Scams

Scam artists follow the headlines, and know there are homeowners falling behind in their mortgage payments or at risk for foreclosure. Their pitches may sound like a way for you to get out from under, but their intentions are as far from honorable as they can be. They mean to take your money. Among the predatory scams that have been reported are:

• The foreclosure prevention specialist: The "specialist" really is a phony counselor who charges high fees in exchange for making a few phone calls or completing some paperwork that a homeowner could easily do for himself. None of the actions results in saving the home. This scam gives homeowners a false sense of hope, delays them from seeking qualified help, and exposes their personal financial information to a fraudster.
  
  Some of these companies even use names with the word HOPE or HOPE NOW in them to confuse borrowers who are looking for assistance from the free 888-995-HOPE hotline.
• The lease/buy back: Homeowners are deceived into signing over the deed to their home to a scam artist who tells them they will be able to remain in the house as a renter and eventually buy it back. Usually, the terms of this scheme are so demanding that the buy-back becomes impossible, the homeowner gets evicted, and the "rescuer" walks off with most or all of the equity.
• The bait-and-switch: Homeowners think they are signing documents to bring the mortgage current. Instead, they are signing over the deed to their home. Homeowners usually don't know they've been scammed until they get an eviction notice.

For More Information

To learn more about mortgages and other credit-related issues, visit www.ftc.gov/credit and MyMoney.gov, the U.S. government's portal to financial education.

The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint or to get free information on consumer issues, visit ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC enters consumer complaints into the Consumer Sentinel Network, a secure online database and investigative tool used by hundreds of civil and criminal law enforcement agencies in the U.S. and abroad. "

If you would like more specific information regarding your situation please contact Felipe Crook toll free at 1-866-589-1646 or email me at felipe@felipecrook.com

Felipe Crook

Prudential Americana Group Realtors

Las Vegas, NV 89117

1-866-589-1646

I have been working with short sale and foreclosure for the last two year in Las Vegas and sometimes I want to scream at how stuborn some banks have become.  They are clearing cutting off their nose to spite their face.  I've given up trying to understand the logic behind their choices, but I'm not giving asking for short sale approvals.   I was recently contacted by a local lawyer who has a very interesting and LEGAL way to deal with banks not approving a short sale or the banks insistance for a deficiency judgement.  

 Jim Stout of the Stout Law Firm wrote a great article about dealing with these pesky banks. Full Article.  His contact information is:

James R. Stout, Esq.
STOUT LAW FIRM
4560 South Decatur Boulevard., Suite 201
Las Vegas, Nevada 89103
Tel: 702-794-4411
Fax: 702-794-4421
jstout@jstoutlaw.com

He also offer FREE consultations which is rare for a law firm.  Here's the article:

"Leasing out your home to a renter during the short sale negotiation process is fraught with risks for the homeowner, lender and renter. The homeowner and renter risk the lease agreement being declared void by a judge. The lender risks the lease agreement being declared valid by a judge. It is a way, however, that the homeowner can earn a monthly payment from the home, a much needed benefit, since his home will ultimatley cost him dearly.

THE HOMEOWNER SHOULD DISCLOSE HER INTENTIONS TO THE LENDER

If the homeowner decides to lease out the home during short sale negotiations, all documents related to the lease should be disclosed before, during and after the execution of the lease. Once the lender becomes aware of the homeowner's intent, the lender must choose between a) accepting the short sale and waiving the deficiency judgment, or b) rejecting the short sale, foreclosing and geting stuck honoring a long-term lease.

If the lender rejects the short sale and chooses foreclosure, it will get stuck with a tenant, or at least having to be the landlord to a valid lease. TITLE VII-PROTECTING TENANTS AT FORECLOSURE ACT SENATE BILL 896 requires the new owner (bank) to honor the existing lease, unless the new owner will live in the home. If the new owner will live in the home, the new owner must provide a 90 day notice.

THE LEASE MUST BE PROVEN TO BE BONAFIED

After the lender forecloses and takes title to the house, it must then chooose between a) honoring the lease pursuant to federal law, b) challenging the lease in court as invalid, or c) paying off the renter to get out of the lease.

A lease will be considered bonafied, and valid if it was executed before the "foreclosure notice" and:
(1) the mortgagor or the child, spouse, or parent of the mortgagor under the contract is not the tenant;
(2) the lease or tenancy was the result of an arms-length transaction; and
(3) the lease or tenancy requires the receipt of rent that is not substantially less than fair market rent for the property or the unit's rent is reduced or subsidized due to a Federal, State, or local subsidy.

The lender will try to get out of the lease by arguing that the lease was entered into after the foreclosure notice; the homeowner and renter were in collusion; and the monthly rental rate is below market.

PROVING THE LEASE RESULTED FROM AN ARMS LENGTH TRANSACTION REQUIRES PROVING THE PARTIES WERE NOT IN COLLUSION

The arm's length principle (ALP) is used specifically in contract law to arrange an equitable agreement that will stand up to legal scrutiny, even though the parties may have shared interests (e.g., employer-employee) or are too closely related to be seen as completely independent (e.g., the parties have familial ties).

A simple example is the sale of real property from parents to children. The parents might wish to sell the property to their children at a price below market value, but such a transaction might later be classified by a court as a gift rather than a bonafide sale, which could have tax and other legal consequences.

To avoid such a classification, the parties need to show that the transaction was conducted no differently than it would have been for an arbitrary third party. This can be done, for example, by hiring a disinterested third party such as an appraiser or broker, who can offer a professional opinion that the sale price is appropriate and reflects the true value of the property.

EXPERT TESTIMONY CAN BE USED TO PROVE THE RENT IS AT MARKET RATE

The lender's defense that the rent is below market rate can readily be defeated through testimony from a seasoned Las Vegas real estate appraiser stating that the market rate for renting a home that is in default is 10% (or whatever deep discount) of renting the same house out prior to default. Who wants to enter into a long-term lease if the house is on the verge of a foreclosure sale? As long as the lease agreement specifically calls for "market rate" or even a few hundred dollars a month, it should easily defeat the not at market rate defense.

PROVING THE LEASE WAS EXECUTED BEFORE FORECLOSURE REQUIRES ESTABLISHING THAT FORECLOSURE BEGINS WHEN TITLE TRANSFERS

The defense that the lease is invalid because it was entered into "after foreclosure" is up for debate. Technically speaking the homeowner will argue, foreclosure begins after title is transferred, not after the Notice of Default was mailed which is what the lender will argue. When foreclosure actually begins has not been adjudicated in Nevada as it applies to the law here. Like most cases, the judge will have to make a ruling after hearing from both sides. This issue has not been settled by the courts.

STATES HAVE EXISTING LAWS THAT CAN BE USED AS GUIDELINES TO DETERMINE IF A LEASE IS BONAFIED

There are several elements which are used in other state jurisdictions as considerations to validate a lease document and demonstrate the parties' intent. These elements may or may not be considered by Nevada judges. Those elements include:
1) the length of the lease, including the beginning and ending date;
2) a statement giving the lessor the complete and exclusive use of the property for the entire duration of the lease;
3) execution in good faith, without deceit or fraud;
4) a sufficient description of the leased property;
5) a statement that the lease contains the complete and sole agreement;
6) a provision that the lessee will pay an agreed amount of rent; and
7) a statement containing the due date, frequency and address for payment of the rent.

CONCLUSION

If the judge validates the lease, the renter can live in the house for the term of the lease. If the judge invalidates the lease, the renter moves out and having learned a lesson, tries it again, under different terms, with hope that the judge will approve the lease next time."

If you have any information about property value or would like some more information on the short sale process, please feel free to call Felipe Crook directly at 1-866-589-1646.  I will help any way I can.

Felipe Crook

Prudential Americana Group Realtors

7475 W. Sahara Ave Ste 100

Las Vegas, NV 89117

1-866-589-1646