Short Sale vs Foreclosure – EFFECT ON CREDIT, By Paul Dean, Evergreen Ohana Group


I thought this information would be beneficial to know, when you are dealing with sellers on a Short Sale basis. Many consumer don’t realize the impact of a short sale on their credit. Read the attached article and commentary from our credit agency below. There are a couple KEY pieces:

1. Foreclosure – lenders won’t do another loan for 4 yrs. (Bankruptcy is now 4yrs also)

2. Short sale – if they keep payments current and their credit is relatively intact, and they do due diligence with the lender to determine how they will report the Short sale on their credit report (ie. “settled” is the best, Deed in Lieu is the same effect as a “foreclosure”) this will result is the least amount of damage to their credit rating. That also goes for a Notice of Default (NOD), even though a foreclosure process was started and the seller is able to sell the home prior to it actually going to foreclosure sale, this will be reported as “foreclosure in process” on their credit, which is treated as a “foreclosure” for credit scoring purposes.

3. Oregon is not a deficiency State. Meaning that Oregon does not pursue the seller for any deficiency. The banks just take the loss, the seller’s credit is damaged, and that’s the end of it.

4. The biggest advantage to sellers in a Short Sale is keeping payments as current as possible and getting the lender to reflect the account as “settled”. That will allow this borrower to secure another home loan sooner (maybe 2yrs), rather than if a foreclosure or NOD (4yrs) is reported on their credit.

I think this is valuable information to share with your sellers.

To Your Success,

Paul Dean
Principal
Evergreen Ohana Group
5331 SW Macadam Ave, Suite 287
Portland, OR 97239

Office: (503) 892-2800 Ext.11
Fax: (503) 892-2803
Email: pauld@evergreenohana.com
Website: http://www.evergreenohana.com
OR ML-21,WA 510-LO-33391, WA:520-CL-50385

Foreclosure leaders focused on 4 states in new metro list, Catherine Clifford, CNNMoney.com staff writer


The 26 cities with the highest foreclosure rate in the nation are all located in four hard-hit states, with Las Vegas topping the list, according to a report released Wednesday.

Metro areas in California, Florida, Nevada and Arizona topped the foreclosure filing list for the first quarter of 2009 in a report from RealtyTrac, an online marketer of foreclosed properties. A foreclosure filing includes default papers, auction sale notices and repossessions.

Las Vegas had the highest rate of foreclosures of any city, with one in every 22 homes subject to a foreclosure filing in the first three months of the year. The rate of foreclosure filings was 4.5%, seven times the national average.

Merced, Calif., had the second highest rate, with Cape Coral-Fort Myers, Fla., Stockton, Calif., and Riverside-San Bernardino-Ontario, Calif., rounding out the top five.

“The metro areas with the highest levels of foreclosure activity in the first quarter of 2009 paint a picture of concentrated problems in a relatively small number of hard-hit areas,” said James J. Saccacio, chief executive officer of RealtyTrac, in a written statement.

Foreclosure rates have been very high in the 4 key states throughout the bursting of the housing bubble, and so it was to be expected that cities from those states would pepper the top of the list.

However, it was a surprise to see the list so top heavy, according to Rick Sharga, senior vice president at RealtyTrac.

“The concentration of troubled metro areas within the hardest-hit states, candidly, was even more severe than we expected it to be,” Sharga said. “The degree to which those four states dominated the rankings surprised even us.”

New problem cities: Meanwhile, some metropolitan areas had a surge in foreclosures. Boise City-Nampa, Idaho, in 27th place, Provo-Orem, Utah, in 37th, and Charleston-North Charleston, S.C., in 51st were examples Sharga gave of areas that had particular strong gains in filings.

Sharga said the rise of foreclosures in additional regions indicates new factors influencing the housing market as the recession drags on.

“What we believe we are seeing is some of the areas with unemployment problems,” said Sharga. “These are people living paycheck to paycheck and, when the paycheck is gone, suddenly they can’t afford to make their mortgage payments.”

The data for RealtyTrak’s metro area foreclosure report is collected from 2,200 counties across the nation, and those counties represent more than 90% of the U.S. population. Some 203 areas are covered by the report.

Across the nation, foreclosure activity in the first quarter hit a record high, according to another RealtyTrac report issued last week. Total foreclosure filings reached 803,489 in the first three months of the year, the highest monthly and quarterly totals since RealtyTrac began reporting in January 2005.

The national report also found that the worst of the foreclosures were centralized in a handful of worst-hit states. California, Florida, Arizona, Nevada and Illinois accounted for nearly 60% of the total foreclosure activity in the first quarter, with 479,516 properties received foreclosure filings in those states.

http://finance.yahoo.com/news/Foreclosure-leaders-focused-cnnm-14996946.html

Multnomah County Foreclosure site updated


New foreclosure reports listed on the multnomah county foreclosure web site. This week a new addition is the bank owned property lists (REO List) for the month of February 2009. This list consists of properties that were forcloused or deeded back to the lender in lew of foreclosure. Some of these homes are on the market but most are not. These lists will have the name and contact information (address) of the owners (lenders) of the property. Contacting the owners for status might allow an opportunity for you to purchase any of these properties in post foreclosure.

Mulnomah County Foreclosures
http://multnomahforeclosures.com/

Fred Stewart
President
Stewart Group Realty Inc.
fred@sgrealtyinc.com
http://www.sgrealty.us/
503-289-4970 (Phone)
503-296-2336 (Fax)