Cash is King – Upside Down Mortgage Solutions

April 29, 2008

Foreclosures Increase 245% In Northern California BUT!!!!

The Real Estate Market in California has hit bottom!  I stand by my numbers listed in my last posting.  If you take a closer look you will see demand increasing while supply is decreasing. (read it here) 

The Bank Owned Properties are still finding offers with nice down payments and they are limiting themselves to only a handful FHA transactions.  The FHA loan is the only loan in California that will allow for zero down payment outside CalHFA which is a much harder loan to process and get through underwriting. (see free report below) This leaves a very large group of people struggling to get their offers accepted and we are still seeing a huge number of open escrows in April.  

We expect this to continue throughout the summer as inventory will remain and those buyers who still need property will be getting their offers accepted later in the year when the great buyers start to go away. (get your offer accepted now see free report below)

If you want my FREE REPORT on “5 Reasons You Should Avoid CalHFA Loans!” please email me at with “CalHFA FREE REPORT!” as the subject!

I have one additional report that will help home buyers and Realtors get offers accepted in the market.  “The 3 Things Every REO Offer Needs to Get Accepted by the Bank” 

If you would like this FREE REPORT please email me at with “REO OFFER REPORT” as the subject.

The link below will detail the increase in foreclosures and we can hope to see a steady stream of inventory which will lead to an increase in affordable property available for purchase by those who are looking for a good deal.




April 24, 2008

3 Signs the California Real Estate Market Has Hit Bottom!

In a Real Estate market such as this most people think that the doom and gloom will last forever.  The Media puts the permanent spin on things and wants the average person to buy into an upside down Real Estate market and the Media is often 60 days late on most information.

I have 3 charts that will show the basics of a Real Estate Market focusing on the Sacramento, CA area but this information can be used across the US as California has been hit the hardest.

Sacramento Real Estate Number CHART HEREwaynes-4-9-08

  1. Chart #1 Market Dynamics: Supply & Demand- The sheer volume of open escrows month over month for the first part of 2008 has really shown had an impact on home prices.  Ask an active Real Estate Agent and you will find that most properties have multiple offers and are going for more than the listed price.  March has shows you that 2944 homes were put into contract and that we should expect the number of closed transactions in the month of April to skyrocket. 
  2. Chart #2 Market Dynamics: Median Price (sold)- January of 2008 was the obvious bottom of the market in the Sacramento, CA area for Real Estate.  You can see how the average price of a home from January to March of 2008 has risen showing strength in the market and the exact increase isn’t represented here but we can see that it was significant.  Chart #1 supports this with an increasing level of volume (demand).
  3. Chart #3 Market Dynamics: Months Supply of Inventory- I think this graph is telling as it goes to prove that demand is up and supply is decreasing.  With only 4 months supply available in March we can expect home prices to increase if we don’t have an influx of new REO homes to keep prices the same.

I always get asked if this is a good time to buy and I tell people a variety of answers based upon what they plan on doing with their properties.  Investors, step it up, now is your opportunity but be prepared to find financing (traditionally speaking) harder to come by these days.  Move up buyers, You can find a steal of a deal out there in this market, high priced home sellers are desperate but bring on your cash because financing can be challenging here too!  First time homebuyers, this is the market you dream of, financing is out there and focused on your segment of buyer.  

By trade I do loans and help many people find solutions to their financing needs.  I can help with a variety of topic so feel free to contact me at

April 17, 2008

Stop Foreclosure: Filing Chapter 13 Bankruptcy may help.

Before you dive in and read to information below I want to share a few things with you.

This post has been up here a while and in that time I have found an even better way to provide information to those people facing foreclosure.  

After you have read through this article you will need more help!  To get that help read this EBook and you will be well on your way to making the best decisions possible.

In bankruptcy Chapter 13 mortgage foreclosure is either stopped or at least temporarily avoided. Here’s how.

First, just in case you are not familiar with a Chapter 13 bankruptcy, it is a bankruptcy court approved payment plan where the debtor (the person filing bankruptcy) pays a bankruptcy trustee each month and then the trustee pays the debtor’s creditors.

There are several aspects of a Chapter 13 bankruptcy that work to help people facing mortgage foreclosure. The first aspect is actually applicable to all bankruptcies. It is called the “automatic stay”.

By law, whenever anyone files bankruptcy, regardless of the type of bankruptcy, there is an immediate “automatic stay” (automatic temporary stopping) of most civil proceedings against the person filing bankruptcy. What this means is that if someone is facing mortgage foreclosure and the person files bankruptcy, the mortgage lender has to immediately stop its’ foreclosure action until it gets permission for the bankruptcy court to proceed.

In a Chapter 13, the bankruptcy court will not lift the “automatic stay” and grant the mortgage lender permission to proceed with a foreclosure until the debtor (the person filing bankruptcy) fails to make his payments to the bankruptcy trustee. As long as the debtor pays the monthly payments to the trustee and pays his regular mortgage payments, the “automatic stay” will remain in force and the mortgage lender can not do anything.

The second aspect of a Chapter 13 that works in favor of people facing foreclosure is that it allows a debtor to pay mortgage arrearage over time, normally 3 to 5 years. In most foreclosure cases, a person has not paid his monthly mortgage payment for several months and the mortgage lender demands full payment of the delinquent monthly payments (arrearage) in lump sum before the lender will consider stopping foreclosure. Most people cannot pay the lump sum.

In a Chapter 13 bankruptcy, a debtor can pay the arrearage over time. He does not have to pay it all at one time. Spreading the lump sum over time means paying smaller monthly payments until the total arrearage is paid. A creditor can object to the amount to be paid each month towards the arrearage, but once the bankruptcy court approves the payment plan, the creditor can not do anything except take the payments.

A third aspect of a Chapter 13 bankruptcy that helps people facing mortgage foreclosure is that unsecured creditors may be paid a portion or all of what is owed to them. What this is really doing is reducing the amount of debt that a person has to pay back each month. By paying unsecured creditors less each month, there is more money available with which to pay a secured creditor such as a mortgage lender. Therefore, it should be easier for a debtor to pay his monthly mortgage payment.

This is general information. If you need specific information or have any questions of any nature whatsoever, talk with a lawyer licensed in your state.


 “Refinancing SECRETS for an Upside Down Loan that Banks Don’t Want You To Know because it will Cost them THOUSANDS of Dollars!”

JUST SEND ME AN EMAIL with “Refi Secrets for Upside Down Loans!” as the subject to

Stop! Did you know that bankruptcy was created to give people a fresh start? Find out more at bankruptcy information. And click here for more insights on Chapter 13 bankruptcy.

April 14, 2008

Avoiding Foreclosure: 4 basic ideas to help you through the process

There is a whole lot of good information here!

Some of the best advice I can give on this subject! 

Possible ways to avoid foreclosure
To avoid foreclosures you should first ask your lender if it is possible to lower your payments. You can also ask them if it is possible to lower your interest rate or extend the repayment period. Using your home equity you may be able to refinance at a lower rate. As a last option you should think about selling your house. This will allow you to repay the loan and improve your credit.

Things to watch out for
Watch out for people that might try to take advantage of you. If you are already in a bad spot you don’t want to be spending money on lawyers and brokers that take advantage of you. You can check out the Better Business Bureau to see if the person has complains against them. And always make sure you read before you sign.

Selling your house
If you end up selling your house, but the sale wasn’t enough to cover all the costs then you might need to talk to your lender and let them know. The lender would prefer if you did this rather then going into foreclosure. Either way the lender is going to have to sell the house. This will prevent your credit from being damaged. You will need to submit a letter to your lender letting them know why you can’t cover all the costs.

How to write a short sale letter
The letter should be emotional and show real struggling individuals. ( Raw Emotion ) You might be embarrassed to share your story with other people, but you need to in order to have them help you. Make sure you don’t point your finger at anyone in this letter. If you were ill or someone in your family has died then the lenders will sympathize with you more. Don’t lie though. Be honest and sincere. Have someone read over your letter so you can get their opinion.


There is a new site that will tell you about a SHORT REFI HERE and this may help those in crazy loans!

April 6, 2008

Upside Down Mortgage:Getting Your Bank to Work with You

Listen in on a Interview I did on Loan Modifications and the

Fannie Mae and Freddie Mac Streamline Loan Modification Program


See my New Post

Refinancing Upside Down Mortgage

“Refinancing SECRETS for an Upside Down Home Loan that Banks Don’t Want You To Know because it will Cost them THOUSANDS of Dollars!”

Follow the Link here “Refi Secrets for Upside Down Loans!” 

It is estimated that 1 in 10 homeowners with mortgages are upside down in their homes, as of March, 2008.

As alarming as that is, the projection is that as home values continue to plummet, 1 in 3 home owners will be upside down by the end of this year, 2008. Let me just take a moment to explain exactly what I mean when I say upside down. It means that you owe more than your home is worth. Another term for this situation is “underwater.”

A good example would be a friend of mine who has a house he built in Tampa, Florida, and has just moved into it from Long Island, NY. He owes $295,000 on it and the builder is now selling similar houses for $185,000. My friend is seriously underwater.

Not only that, his mortgage will adjust in a year to a number that will probably push him into foreclosure. He no longer wants the house. What he doesn’t know, is that neither does the bank! They do not want a house that is worth less than the financing on it sitting on their books.

Loss Mitigation can be his solution.

This is the process of mitigating or lessening the losses associated with assets, in this case homes.

It is a department in a bank and it is also the process of negotiating a solution that will mitigate losses for both the bank and the homeowner, typically allowing him to stay in the house so that it does not drag down the bank’s balance sheet.

Could my friend negotiate his own loss mitigation deal? Yes, he could also remove his own appendix, but the outcome in both cases would probably be disaster. Were he to call the bank, he would be ill prepared for what he will likely encounter.

First, he will have difficulty finding the right person to help him.

Second, if he eventually stumbled upon the loss mitigation department, they would probably not talk to him because he is not delinquent or in foreclosure and he would not get anywhere.

His best chance is to be represented by a loss mitigation professional negotiator.

This is someone, usually a former banking insider or mortgage broker, who is now working on the other side of the desk, helping those who are in trouble with their loans. He will know where the bodies are buried in the bank and will be familiar in many cases with the specific personnel in the bank’s loss mit department.

If the homeowner can show that his DTI, Debt to Income ratio, is under 50% now, and he has proved that he can make his present payments but would go to a 60% or higher DTI upon the reset of the loan; the loss mitigator is in a good position to negotiate a loan modification that would recast the loan without the scheduled increase.

Although the homeowner’s DTI is simply calculated by dividing his income by his total monthly debt load, the homeowner may include or exclude items or report them in a manner that will quickly get his proposal shot down by the bank.

Say he is paid weekly, bringing home $1,000/wk. He puts his monthly income down as $4,000/Mo.

In reality, there are 4.3 weeks in a month, so he is short changing himself by $300/mo. Not a big deal?

What about something as simple as reporting the cost of food for a family of four, for instance? The homeowner may report their actual figure of say, $800 month. He has no way of knowing that the bank is satisfied with a pro forma, $100/person/month figure for food. So now, he has short changed his income by $300/mo and overstated his expenses by $400/mo. Such a net swing of $700 month could easily push his DTI into the rejection zone.

The loss mitigator, on the other hand speaks the bank’s language, knows and understands their criteria and procedures, allowing him to help the homeowner tailor his situation to satisfactorily meet them.

The alternative to the bank is not a positive one.

The homeowner stops paying. They bring a foreclosure. The house does not sell at auction so they have to continue it on their books as a non performing asset which is a black mark on their finances.

It has been observed that the total cost to the bank to take a house back, in terms of lost interest payments, legal fees, administrative fees, maintenance, repairs, taxes, insurance, broker fees, etc; including the loss on the house when it is eventually dumped on the market at a fire sale price, could easily total $50,000 or more!

It just makes more dollars and sense to have the homeowner in the house, making payments he can afford while keeping a non performing loan off their books. That is the outcome of a successful loss mitigation.



Copyright 2008 Bill Young
Bill is the Director of a nationwide loss mitigation network. If you are a real estate professional looking to augment or replace your regular income, the loss mitigation industry could be your answer. More information Click here: http://Loss-Mitigation.Info or call Bill at 646-961-3818

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