I believe part of the confusion lies in the VA guarantee; homeowners think they have to pay that money back. In most cases the money does not have to be paid back; it is forgiven through the VA short sale process. However, a VA eligible borrower will not be able to use their VA eligibility to buy another home until any deficiency is paid back. But, there is nothing stopping that borrower from getting an FHA or conventional loan for the purchase of real estate after the two year period, providing the buyer has effectively rebuilt his or her credit.

A homeowner does need to prove a valid hardship, and a military transfer or deployment is a valid hardship if your home is worth less than what you owe on it and as a result, you cannot sell.

The best thing to do is simply give me a call and we will discuss your lending structure, hardship and home value, and then call your loan servicer to confirm required paperwork and eligibility for a short sale. You must ALWAYS be aware of ALL your options before committing to a strategy.

We all know that land can be much more difficult to obtain financing on, especially with current lending guidelines.  With just 10% down, you do not need a bank to capture a great piece of land in Fountain Hills.  Here is a sample of the terms for one of the parcels which is offered at $249,000.

10% Down – $24,900

Payment – $1,650.31 @ 8% Interest Rate (P & I)

2 year balloon note

The other parcel is offered at $259,000 and adjoins the other parcel and is also offering terms.  Of course both can be purchased with cash or traditional financing if you prefer.  The parcel offered at $259,000 is just over 1 acre on a hillside with amazing views.  The other parcel is .87 acres and offers similar views.  Both of these parcels are located in the Fountain Hills subdivision of Eagle Ridge.

Whether you are interested in holding to build your dream home or you just want to own for an investment, land has always been a good investment.  Even in times like these, land tends to hold its value more than some homes as there is not as much quality inventory.  Comparable lots to these in Eagle Ridge were selling for over $400,000 in ’05 and ’06.  Similar parcels in Sunridge Canyon were selling for over $350,000.

If you aren’t not familiar with Fountain Hills, I encourage you to research.  It is just East of Scottsdale and is know for its small town charm and spectacular views.  It is also home to the world’s tallest fountain.

If you have questions about these lots or would like more information, please do not hesitate to call me at 480-201-4185 or drop me an email.

~ Kim

Ready To Sell You Your Slice Of The Arizona Sunshine!

With housing inventories at an all time high and banks tightening the guidelines for obtaining a mortgage, agents must think “out of the box” to help their clients sell their homes.  Owner financing, a.k.a. seller financing is one such technique as it will open the pool of buyers who could purchase your home.

With institutional financing being a challenge to obtain, buyers are searching for creative ways to get into homes.  Many of these buyers have a down payment and have good income, but they have a credit flaw from the past or perhaps they are self-employed and have a problem proving their income.  As a seller, if you can provide the vehicle for them to purchase, your home will stand out from the others.

I am not suggesting that a seller would allow any buyer to buy their home on terms.  A credit report is highly recommended and an application stating income, employment, etc. would also be advised.  This process would be similar to how a bank reviews a mortgage application.  The difference is that you may be more willing to carry the note than the bank who may be trying to sell it on the secondary market and must meet strict guidelines.  Your risk is off set by the down payment.  The riskier the applicant, the higher the down payment usually.

At this point you may be thinking, “This is all fine and good, but I have a mortgage and no equity in the property, how am I going to do this”?  Well, you can.  Especially if you have a good interest rate on your existing mortgage as many do since rates were very low in recent years.  An instrument called the Illinois Land Trust offers many forms of protection on owner financing deals, but most notably it protects a lender from executing their due on sale clause if title transfers.  (I will go into more detail on the Illinois Land Trust in  future posts. ) So by eliminating the risk of the due on sale clause, a seller can effectively allow a new buyer to take advantage of the financing they already have in place.  If the existing mortgage is 6%, a seller can offer the new buyer (who does not usually have perfect credit) a rate of 7% and even cash flow a little.  A seller can usually justify their price as they are offering creative terms that the buyer needs.  The length of terms is negotiable as well.  A longer term will allow for the property to appreciate a little thereby eliciting the seller some equity that they maybe did not have.

There is so much to talk about regarding owner financing.  In an effort to keep this brief, I am going to be writing several future posts on the topic.  If you get anything out of this article, I hope it would be that I can help you as a seller or a buyer if you need seller financing.  It is very important to have a knowledgeable agent to put these deals together for you.  I have several properties now that offer owner financing, you may go to my Featured page to find some. I have others not listed yet so please Contact me for more information.

If you want to make sure you do not miss a future post on Owner Financing, sign-up to receive my posts directly to your email or blog reader.

I look forward to hearing from you! – Kim

“Ready to sell you your slice of sunshine…”

To be on the forefront of this, a Realtor should be participating in Social Networking & Blogs. Realtors should be utilizing Real Estate 2.0 to procure buyers and sellers and expose properties. I spend 1-2 hours a day working on my blog and researching the technology that will allow me to offer the best solutions for my buyers and sellers.

Today a Realtor must have a strong knowledge base on Foreclosure Law, Short Sales, Finance & Market Data. Sellers are presenting challenging scenarios to Realtors and the good ones know how to present solutions. Another tool today that a good Realtor will have is the ability to structure Seller Financing. With institutional financing tightening, good borrowers are having trouble obtaining financing and Seller Financing may be a good alternative. Seller financing opens the the pool of buyers for a seller who is trying to sell their home. It has some very positive benefits to the seller and is not just for “desperate sellers”. There is also risk, so structuring a good seller financed deal is where a qualified real estate agent will prove highly beneficial.

All of these tools are on top of having a qualified agent who understands the market, knows how to structure a contract, understands how to keep a transaction together and has powerful negotiating skills. For those who believe a Realtor is just a glorified data entry person for the MLS, I encourage you to think about all facets of a real estate transaction.

In my future posts I will be discussing all the tools in my bag for marketing homes and procuring buyers. I can help buyers position themselves to buy, whether that is now or down the road. I enjoy the education process and believe that if buying is your goal, there are many things you can do to work towards that. Probably most important is have a road map to achieve your goal.

If you would like to discuss buying a home or selling your home , please call me at 480.201.4185.

Kim Anderson