Wednesday, September 30, 2009

A Disturbing Trend: Delinquent Homeowners Abandoning Their Homes

In my efforts to locate homeowners who are behind on their mortgage payments, or already in foreclosure, I have discovered a disturbing trend. It appears that many of these homeowners are simply abandoning their homes and ignoring their problems. This is a terrible idea. Until the bank owns your home, you are liable for anything that happens to or on your property. Beside the liability issues, "abandoning ship" does nothing to stop, or even mitigate your potential liability to the lender(s).

If you are a homeowner in financial trouble, please do not abandon your home. Follow the instructions in my blog post Question and Answer: What Should I Do if I Can't Pay My Mortgage?.

If you live in the following areas, please contact me as I can help you solve your real estate problems since I am a Middle Tennessee short sale, pre-foreclosure (preforeclosure) and foreclosure expert and REALTOR.
  • Rutherford County Tennessee: Murfreesboro TN, Smyrna TN and La Vergne TN (LaVergne TN)
  • Williamson County Tennessee: Brentwood TN and Franklin TN
  • Davidson County Tennessee: Nashville TN and Belle Meade TN

Question and Answer: What Should I Do if I Can't Pay My Mortgage?

Question: What should I do if I can't pay my mortgage?

Answer: If you are a homeowner who cannot pay your mortgage payment(s), or are already in foreclosure, you should do the following:
  1. Loan Modification - Even though you do not have a good chance of getting a loan modification approved by your lender(s), you should give it a try.  Therefore, contact your mortgage company immediately to discuss a loan modification.
  2. Discuss your situation with a real estate attorney and/or bankruptcy attorney to discuss your options if the loan modification is not approved.
  3. If a loan modification will not work, or is not approved, and you owe more than your home is worth and you cannot pay you mortgage, you need to speak with a REALTOR who specializes in short sales and pre-foreclosures (preforeclosures) to discuss selling your home.
If you live in the following areas, please contact me as I can help you get out of this situation.
  • Rutherford County Tennessee: Murfreesboro TN, Smyrna TN and La Vergne TN (LaVergne TN)
  • Williamson County Tennessee: Brentwood TN and Franklin TN
  • Davidson County Tennessee: Nashville TN and Belle Meade TN

Bank of America CEO Will Resign at the End of the Year

According to this New York Times article, Bank of America Chief to Depart at Year’s End, Kenneth D. Lewis, will resign at the end of 2009. According to the article, he "celebrated his daring takeover of Merrill Lynch as the crowning triumph of a long career. On Wednesday, that conquest proved to be his downfall, as he announced his resignation after months of legal and political scrutiny over how the deal went down. Mr. Lewis leaves as Congress, the attorney general of New York and investors turn up pressure on the bank over not disclosing Merrill's losses and bonuses to shareholders. A federal judge recently refused to accept a settlement brokered between Bank of America and the Securities and Exchange Commission, saying the bank and the commission never fully explained how the decisions were made."

I think all the bank CEO's should step down right now as they have mismanaged their banks and collected millions in pay and bonuses despite their failings. The banks has completely botched the handling of pre-foreclosures, short sales and foreclosures. I am personally dealing with Bank of America on a short sale located in Murfreesboro Tennessee (Rutherford County TN) and I was able to get approval within 3 weeks, but it took a lot of phone calls and emails to push them to a decision. It just should not be that difficult. As a result of Bank of America's incompetence (and the incompetence of other lenders) there are more short sales and foreclosures in Middle Tennessee (in the Nashville TN area) than there should be. Goodbye Mr. Lewis!

If you are a homeowner who cannot pay your mortgage payment(s), or are already in foreclosure, my recommendation is that if you should do the following:
  1. Loan Modification - Even though you do not have a good chance of getting a loan modification approved by your lender(s), you should give it a try.  Therefore, contact your mortgage company immediately to discuss a loan modification.
  2. Discuss your situation with a real estate attorney and/or bankruptcy attorney to discuss your options if the loan modification is not approved.
  3. If a loan modification will not work, or is not approved, and you owe more than your home is worth and you cannot pay you mortgage, you need to speak with a REALTOR who specializes in short sales and pre-foreclosures (preforeclosures) to discuss selling your home.
If you live in the following areas, please contact me as I can help you get out of this situation.
  • Rutherford County Tennessee: Murfreesboro TN, Smyrna TN and La Vergne TN (LaVergne TN)
  • Williamson County Tennessee: Brentwood TN and Franklin TN
  • Davidson County Tennessee: Nashville TN and Belle Meade TN

Get Expert Assistance from a Middle Tennessee Distressed Real Estate, Short Sale, Pre-foreclosure and Foreclosure REALTOR, Real Estate Expert & Real Estate Professional

Get Expert Assistance from a Middle Tennessee Distressed Real Estate, Short Sale, Pre-foreclosure and Foreclosure REALTOR, Real Estate Expert & Real Estate Professional

Attention Property Owners and Homeowners in Middle Tennessee (Rutherford County TN, Williamson County TN, Davidson County TN, Murfreesboro TN, Smyrna TN, La Vergne TN, Eagleville TN, Lascassas TN, Rockvale TN, Christiana TN, Brentwood TN, Franklin TN, Nashville TN and Belle Meade TN) - Get Expert Assistance from a Middle Tennessee Distressed Real Estate, Short Sale, Pre-foreclosure and Foreclosure REALTOR, Real Estate Expert & Real Estate Professional
If one or more of the above situations apply to you then you need to get help from a Short Sale, Pre-foreclosure and Foreclosure REALTOR & Real Estate Professional who can help you avoid Foreclosure, sell your home via a Short Sale, or even get a Loan Modification.

A Loan Modification may help you keep your home and should be considered. However, many lenders seem unwilling to grant modifications. If you cannot get a loan modification, or your home is worth less than the mortgage balance(s), or you just can't afford to keep your home then a Short Sale may be your best option as it could salvage what is left of your credit and to reduce the risk of the lender pursuing you for their net loss (deficiency judgment). Acting quickly will give you the greatest chance of getting your life back without all the stress and worry. For immediate help please contact Jim McCormack now!*

Jim McCormack's Foreclosure and Short Sale Assistance Hotline

(615) 653-4383
*Jim McCormack is a REALTOR, not an attorney. You should consult an attorney before making any real estate decisions.

For more information, please visit my real estate website,, which is focused on helping property owners who are in foreclosure, or who need expert assistance with a short sale (i.e. where the property value is worth less than the mortgage debt). My website is designed to inform short sale and pre-foreclosure sellers and consumers on how to best solve their real estate problems in the quickest time possible. The articles and tools throughout the website are FREE, with zero strings attached.

If you would like more information first, please let me introduce myself. My name is James W. McCormack. I am a Short Sale, Pre-foreclosure and Foreclosure REALTOR and Real Estate Expert. I am a 10+ year real estate sales veteran and full-time real estate professional who specializes in helping people solve their real estate problems. I focus on short sales, pre-foreclosures, foreclosures and investment properties in the Middle Tennessee TN market with my primary focus being on Murfreesboro, Smyrna, La Vergne and Eagleville in Rutherford County, Brentwood and Franklin in Williamson County and Nashville and Belle Meade in Davidson County. My website helps you to search for and find short sale listings, pre-foreclosure listings and foreclosure listings in Murfreesboro TN, Smyrna TN, La Vergne TN, Brentwood TN, Franklin TN, Belle Meade TN and Nashville TN.

I am a real estate expert who is here to help you. Please call me at 615-653-4383 to discuss your real estate situation or problems. I almost always return phone calls by the next business day.

I provide the following real estate services:

Specialty and Challenging Real Estate (Sales, Consulting & Leasing):
1. Physically Distressed Properties (i.e. fixer uppers, rehab properties, handyman specials, etc.).
2. Foreclosures.
3. Pre-foreclosures (i.e. Notice of Default, etc.).
4. Short Sales (i.e. where the sale price is not enough to pay off the mortgage(s) and other liens.).
5. Bank Owned Real Estate (i.e. REO's).
6. Divorce Sales.
7. Estate Sales.
8. Abandoned and Vacant Properties.
9. Rental Homes and Properties (Leasing and Consulting).
10. Lease Option/Lease Purchase Homes (Sales, Leasing & Consulting).
11. Other Difficult Situations.

Commercial and Investment Real Estate (Sales & Leasing):
1. Small Multifamily Properties (2-4 units).
2. Apartment Buildings (5+ units).

Search Middle Tennessee MLS Listings
Find Middle TN Real Estate, Houses, Homes, Townhomes, Condos, Building Lots, Farms & Land
Find Short Sales, Pre-foreclosures, Foreclosures, REO's, Bank Owned Properties, Fixer Uppers & Other Distressed Real Estate

Freddie Mac Goes Door Knocking to Help Struggling Homeowners Complete Loan Modifications

According to this Freddie Mac news release, FREDDIE MAC STARTS DOOR-TO-DOOR EFFORT HELPING BORROWERS COMPLETE HOME AFFORDABLE MODIFICATIONS, Freddie Mac "has hired Titanium Solutions, Inc. to meet with delinquent borrowers at their homes and help them supply missing information, documents and complete other actions needed to begin their three month trial payment periods for Home Affordable Modifications under President Obama’s Making Home Affordable program. Titanium Solutions will target late-paying borrowers with Freddie Mac-owned mortgages who have not returned letters or phone calls sent by their servicers, or who need to provide additional information or documents to launch their three-month Home Affordable Modification trial periods. Titanium will also help those borrowers who have started their Trial periods complete the documentation process to enable them to be converted into final modifications."

The release quotes Ingrid Beckles, Senior Vice President of Default Asset Management at Freddie Mac, as saying "By meeting with our borrowers, one on one, in their homes Titanium Solutions can help them overcome the roadblocks keeping them from starting their Home Affordable Modification trial periods. We believe this can give borrowers seeking Home Affordable Modifications the same type of personalized guidance they may have had when they were buying their home or applying for their mortgage.

Overall, I think this door knocking is a good idea since most homeowners who have fallen behind on their mortgage payments, or are already in foreclosure, just stop communicating with the lenders and try to ignore the whole thing (not a good idea). Struggling homeowners should openly engage their lenders to see what options they have. A loan modification may indeed be the best option, however, most people do not qualify for a loan modification due to insufficient income (think unemployed) or too much overall debt.  While I do not think that loan modifications can solve the foreclosure crisis we are currently in, for some folks it is the best option.

My recommendation is that if you are a homeowner in financial distress you should contact your mortgage company immediately to discuss a loan modification even though you do not have a good chance of getting a loan modification approved. Some chance is better than the no chance you will have if you do nothing. You may also want to speak with a real estate attorney and/or bankruptcy attorney to discuss your options. If a loan modification will not work, or is not approved, then you need to speak with a REALTOR who specializes in short sales and pre-foreclosures (preforeclosures) to discuss selling your home when you owe more than your home is worth and/or you are not able to pay your monthly mortgage payments. If you live in the following areas, please contact me as I can help you get out of this situation.
  • Rutherford County Tennessee: Murfreesboro TN, Smyrna TN and La Vergne TN (LaVergne TN)
  • Williamson County Tennessee: Brentwood TN and Franklin TN
  • Davidson County Tennessee: Nashville TN and Belle Meade TN

Could Tighter Loan Underwriting Standards Hurt the Housing Recovery?

According to this RISMEDIA article, Credit Woes to Threaten Housing Recovery?, "Nearly two-thirds of single-family home builders are reporting a severe lack of credit for housing production, threatening the fragile housing recovery before it has time to take hold, according to a new builder survey of acquisition, development and construction (AD&C) financing conducted by the National Association of Home Builders (NAHB)."

The article quotes NAHB Chairman Joe Robson, a home builder from Tulsa OK, as saying "Across the country, home builders and developers are reporting a deterioration in credit availability and intensifying pressure on borrowers with outstanding loans. Lenders are cutting off loans for viable new housing projects and producing unnecessary foreclosures and losses on AD&C loans. With the pending expiration of the $8,000 first-time home buyer tax credit, these challenges threaten to halt any positive developments we have seen in the housing market in recent months.  There can be no meaningful economic recovery until the flow of credit is restored to housing."  (My thoughts: Since when has housing been a legitimate driver of the economy for any extended period of time?  How can over priced asset prices such as housing create long term jobs?)

According to the article, the most recent NAHB survey of AD&C financing conditions, showed that some 63% of builders thought that the "availability of credit for single-family construction loans worsened in the second quarter of 2009."

The article states that home builders reporting worsening credit conditions cited the following reasons for the decline in lending:
  • 80% said that lenders are lowering the allowable loan-to-value ratios.
  • 76% reported that lenders are not making new loans."
  • "75% stated that lenders are reducing the amount they are willing to lend"
  • 62% said that lenders are requiring personal guarantees or collateral not related to the project.
According to the survey "Two-thirds of respondents reported putting single-family construction projects on hold until the financing climate gets better."

The article notes that lenders, as an explanation for the reduced lending activity, have told home builders that banking regulators are forcing them to tighten lending standards.  Federal regulators, on the other hand, say that they have not restricted lenders from making more loans.

The article states that the "NAHB believes that regulators and lenders should provide leeway to residential construction borrowers who have loans in good standing by providing flexibility on re-appraisals, loan modifications and perhaps forbearance on loans to give builders time to complete and sell their inventory."

I have to say that I have had enough of this nonsense.  We do not need more credit to help a housing market that has imploded as a result of too much credit.  I do have a serious problem with lenders due to their taking of taxpayer bailout monies and their grossly incompetent handling of short sales and foreclosures, but I do not blame them for reducing their loan activities or tightening their credit standards in the face of rising unemployment and increasing loan delinquencies.  It appears that the NAHB is doing nothing but advocating something that will help home builders sell their over priced homes to naive home buyers - all at tax payer expense as these loans go bad and the federal government steps in to continue to bail out the lenders that made these loans when the financially strapped home buyers need to short sell their homes and/or fall into foreclosure.

Therefore, the answer to the blog post title question is "No" for the following 2 reasons.
  1. There is no actual housing recovery. Housing prices continue to fall and foreclosures continue to increase.  Where is there is more than average government intervention, such as CA with their $10,000 new construction home purchase tax credit, there has a been a slight bump in prices that will only get worse when that government intervention is stopped.
  2. Tighter housing credit will actually the housing market in the long run due to weeding out financially unstable buyers. Long term housing market stability is the most important thing now.
Given the absurdly high levels of new construction still going on and available for purchase in Middle Tennessee (Rutherford County: Murfreesboro TN, Smyrna TN and La Vergne TN) the housing market here will continue to decline for years to come as there will be more builder bankruptcies, short sales and foreclosures in the Middle TN market.

    Peterbilt Permanently Closing Middle Tennessee Plant

    According to this Nashville Business Journal article, Peterbilt permanently closing Tennessee plant, effective 12/1/2009 Peterbilt Motors Co., the well known truck manufacturer, will shutter the Madison Tennessee (located in Davidson County TN northwest of Nashville TN) plant. According to the article, "The Madison plant had not built trucks since July 2008, when the company and the United Auto Workers Local 1832 were unable to agree on a new contract. But company officials said the decision to shutter — and eventually close — the plant was a result of falling demand for the heavy-duty trucks, not because of labor issues."

    The article quotes Bill Jackson, Peterbilt General Manager, as saying "This was a difficult, but necessary decision. The current and projected market conditions are very challenging and Peterbilt is aligning its production capacity with market demand. Peterbilt is proud to have been a member of the greater Nashville community for 40 years and we thank our employees for their excellent contribution."

    According to the article, all of the company's truck manufacturing will move to Peterbilt's other plant in Denton, Texas. The article states "The 2,000-worker facility, which does not have union representation, announced layoffs there in January, though the company didn’t specify how many jobs were impacted, saying only that it was a small number. At the Nashville plant, 313 workers were laid off in June 2008 when the contract expired, according to the Tennessee Department of Labor."

    While Peterbilt officials said that the Madison TN plant closing was a result of market conditions, not union/labor issues, I have to believe that the union was a major factor in the plant closing. The fact is that unions cause companies to earn less and to layoff workers in order to remain competitive. In this case the union caused the loss of at lease a large percentage of the 313 lost jobs. Given that 25% of homeowners have no savings to cover their living expenses if they were to lose their jobs (see my previous blog post Too Many Homeowers Have No Savings) I think it is reasonable to conclude that more job losses will cause more short sales and foreclosures in Middle Tennessee as a large percentage of unemployed people in Middle TN cannot pay their mortgages even for a short period of time due to a lack of savings.

    Tuesday, September 29, 2009

    Experts: More Rough Times Ahead for U.S. Economy

    According to this RISMEDIA article, More Rough Times Ahead for U.S. Economy, despite Recent Improvements, several prominent experts in real estate and the economy who attended a recent forum at the Nixon Presidential Library said that despite recent signs of improvement more rough times are ahead for the U.S. economy. The event was organized and moderated by real estate analyst and investor Bruce Norris of The Norris Group in Riverside CA. the event included experts from the California Building Industry Association, the National Association of Realtors, the Mortgage Bankers Association, RealtyTrac, The Appraisal Institute and the National Auctioneers Association.

    The RISMEDIA article quotes Christopher Thornberg of Beacon Economics regarding increases in durable goods orders, exports and auto sales as saying "You look at the numbers and everything points to the fact that we not only have bottomed, but things seem to be improving. When you think about the problems we’ve been through and what government has done, in many ways, they have, in fact, stabilized the economy. But you know what? They haven’t actually solved the underlying problems in the economy. The second half of 2010 will be very weak. 2011 will be very grim." According to the article, Thornberg cited real estate as a case in point. The article states that while home sales are up in some areas of the country, 6-7% of residential mortgages across the US are now 60 to 90 days delinquent. According to the aritcle, in California 250,000 mortgages are 60 to 90 days late. Thornberg believed that more economic trouble is coming soon due to rising unemployment and additional waves of foreclosures. If you remember my past blog posts I have been saying this for months (i.s. the coming foreclosures of Option ARM's).

    The article noted the following thoughts and comments of the forum panelists:
    • All of the panelists agreed that the economy will turn the corner in 2-3 years, but several panelists thought that things would get worse before improving.
    • John Young, vice president of the California Building Industry Association, noted that new housing construction starts are at their lowest levels since the early 1950s and that new home sales are being hurt by appraisals coming in lower than the contract sale prices.
    • Rick Sharga, senior vice president of RealtyTrac, a leading online marketplaces for foreclosures, noted the nation has had 43 consecutive months of foreclosures.  He said "We’re dealing with foreclosure activity that is six times what it would be in a normal market."  He also said that the legal and legislative efforts aimed at helping consumers modify the terms of their loans “merely delay the inevitable" given that modified loan terms will not help people who lose their jobs.  Sharga said he sees another big wave of foreclosures hitting the market next year as a result of rising unemployment rates, which are expected to peak during the first quarter of 2010, and the resetting of adjustable rate mortgages to higher rates.  Sharga also said that the real estate market is being hurt by a "shadow inventory" of 400,000 to 500,000 homes, which have been taken foreclosed and taken back by lenders, but have not been put back on the market for resale.  I have been saying that the number of REO's far exceeds the number being offered for sale for a while now.  When the Option ARM's start to reset this is going to break the proverbial flood gates wide open.
    Of course there was the normal refrain of from a former president of the National Association of REALTORS who wants Congress to expand the home purchase tax credit to $15,000 for all home buyers.  Per my previous blog posts I think this is a bad idea because it will artificially inflate home prices resulting in more bubble bursting when the tax credits are finally stopped.

    The forum organizer, Bruce Norris, recommended that Congress take the following actions to help the real estate market:
    1. "Increase the number of loans made available to well capitalized investors: Expand Fannie and Freddie loan programs from a maximum of 10 loans per investor to an unlimited number of loans for qualified investors."
    2. "Make the 203K FHA loan program available to investors: A 203K loan allows a property needing work to be purchased “as is,” but included in the loan amount is money for repairs. The loan funds both the purchase and rehab of the property. Investors need this loan now, but this loan is currently only available to owner occupants. FHA previously made this loan available to investors, but stopped the practice in 1996 when HUD ran out of lender owned, fixer uppers. Banks could solve the vacant house problem by giving investors back the 203K loan program."
    3. "Eliminate the 90-day waiting period before a repaired property can be sold to a buyer using an FHA loan: Investors who purchase fixer uppers can often completely repair the property in a matter of weeks. But the current law prohibits investors from reselling the property within 90 days. The assumption is that fraud must be taking place if a property is resold within 90 days. It’s ridiculous to assume that every investor who purchases a property, improves and resells it is committing fraud. All this policy does is increase investors’ costs of purchasing and rehabbing vacant homes.
    4. Allow loans to be taken over by credit-qualified new buyers with no down payment. Through this process, which was successfully used in the 1980s, new buyers simply step in and take over the loan payments. The only stipulation is that the loan has to be made current at the close of escrow. The U.S. currently has about one million owners who will not be capable of keeping their homes without a huge discount on the principle balance. Many of these properties have fixed rates at very favorable rates. Allowing willing and capable buyers to come in and take over these loans would help contain the spread of foreclosures across the country.
    I agree with Mr. Norris' first 3 points, but I fail to see how allowing delinquent loans to be "taken over by credit-qualified new buyers with no down payment" will help the market when the real problem is that the loan balances exceed property values.

    Thornberg, thought that it is "not realistic to assume that our nation’s economic problems will be solved by increased regulation or by presidential action. The economy simply needs some time to heal itself.  I have tremendous faith in the U.S. economy rebounding again in the future.  When we come out of this in two or three years, we’re going to have cheap housing and a weak dollar, which will be good for exports."

    I agree with Mr. Thornberg in that cheap housing is good for the economy. The problem is that the Obama Administration is doing so much to artificially prop up housing values.  Why would they do this?  The answer is that the Obama Administration and their Democrat friends are bailing out their Wall Street and banking buddies such as Fannie Mae, Freddie Mac, AIG and Goldman Sachs.  Don't believe me?  Go find out who the largest campaign contribution recipients from Fannie Mae, Freddie Mac and AIG (hint: Barney Frank, Christopher Dodd and Barack Hussein Obama).

    In my market in Middle Tennessee (Rutherford Couny TN in particular) I believe that the effect of all this will be worse than average due to higher than average unemployment rates and foreclosures.  Housing prices in Middle Tennessee will continue to fall well into 2012.

    Monday, September 28, 2009

    National Association of REALTORS: Existing-Home Sales Decline in August 2009

    According to this National Association of REALTORS (NAR) news release, Existing-Home Sales Ease Following Four Monthly Gains, sales of existing homes (includes single-family homes, townhomes, condominiums and co-ops) declined by 2.7% to a seasonally adjusted annual rate of 5.10 million units in August 2009 from a pace of 5.24 million in July 2009. According to NAR, this is 3.4% above the 4.93 million-unit level in August 2008. Over the previous four month span from April 2009 through July 2009, sales had risen a total of 15.2%.

    The news release states that according to Lawrence Yun, NAR Chief Economist, the first time home buyer tax credit is working. The release quotes Yun as saying "Home sales retrenched from a very strong improvement in July but continue to be much higher than before the stimulus. The first-time buyer tax credit is having the intended impact of bringing buyers into the market, allowing them to take advantage of very favorable affordability conditions. Some of the give-back in closed sales appears to result from rising numbers of contracts entering the system, with some fallouts and a backlog contributing to a longer closing process, but the decline demonstrates we can’t take a housing rebound for granted."

    The news release goes on to state that a NAR practitioner survey shows that for August 2009, first-time buyers accounted for 30% of home sales and that distressed homes accounted for 31% of home sales. Both of these figures were unchanged from July 2009.

    The release goes on to quote Yun as saying "The recent trend shows broad improvement in most of the country, but with an expected rise in foreclosures over the next 12 months we need to maintain a healthy level of ready buyers to absorb the inventory. An extension of the tax credit is critical to preserve incentives for financially qualified buyers to enter the market. Now that the market is showing some momentum, we have an opportunity to achieve a more rapid and broader stabilization in home prices. Extending and expanding the tax credit also would help to keep other families from becoming upside down in their mortgages or risk foreclosure. When home prices show sustained gains, credit will become more widely available to other sectors because Wall Street will be able to price risks confidently. Stable home values will also allow more families to purchase consumer products and provide a strong boost for the broader economy."

    According to the news release, in the Southern US, existing-home sales were down 3.1% to an annual pace of 1.89 million in August, but are 1.6% above August 2008. The median price in the South was $157,400, which is 11.0% lower than the same period in 2008.

    While this seems fine and dandy, I have a problems with the "spin" on these statistics.
    • Number of Home Sales - Other than for REALTORS and other folks who generate income when homes sell, and as a result, need to turn units, this figure is just not that important unless it reaches extreme levels as it says little about the overall health of the housing market.  For example, if homes were worth $1 there would be a lot of sales, but the market would be devastated.
    • Home Prices - The sale prices of homes declined by 10%+ in every region of the US.  This is further evidence that the market has not hit bottom yet.
    • Tax Credit - I find Yun's comments including "An extension of the tax credit is critical to preserve incentives for financially qualified buyers to enter the market." to be laughable.  First, qualified buyers do not need a government subsidy to "enter the market" buy a home. What they need are AFFORDABLE HOMES, which the market is giving us as only a free market can!  We do not need an artificial government subsidy that will temporarily inflate home prices only to see those prices fall when the subsidy is discontinued. Yun says he want to have home prices "show sustained gains" so that "credit will become more widely available." Given that this whole financial mess was caused by credit being too widely available it is utterly foolish to try to expand credit further.  All we need to save the economy is to have homes reach prices that are sustainable based on people's incomes, not debt.

    Sunday, September 27, 2009

    Nashville Business Journal: Greater Nashville unemployment hits 9.8%

    According to this Nashville Business Journal article, Greater Nashville unemployment hits 9.8%, the Nashville Tennessee Metropolitan Unemployment Rate reached 9.8% in August 2009, which is up from 9.6% in July 2009. The article noted the following unemployment statistics for the following counties in the greater Nashville TN area:
    • Davidson County TN Unemployment - The unemployment rate increased to 9.6% in August 2009, which is up from 9.2% in July 2009.
    • Williamson County TN Unemployment - The unemployment rate decreased to 7.7% in August 2009, which is down from 8.3% in July 2009.
    • Rutherford County TN Unemployment - The unemployment rate decreased to 10.1% in August 2009, which is down from 10.2% in July 2009.
    • Wilson County TN Unemployment - The unemployment rate increased to 9.5% in August 2009, which is up from 9.1% in July 2009.
    • Sumner County TN Unemployment - The unemployment rate increased to 10.3% in August 2009, which is up from 9.9% in July 2009.
    The article goes on to state that according to the Tennessee Department of Labor and Workforce Development, across Tennessee unemployment increased in 47 counties, decreased in 42 counties and stayed the same in 6 counties.  Overall, the August 2009 unemployment rate in Tennessee was 10.8%, which is over a full percentage point higher than the US national unemployment rate at 9.7%.

    Given that most of the counties in the greater Nashville Tennessee metropolitan area have unemployment rates of over 9%, with Rutherford County TN and Sumner County TN posting unemployment rates over 10%, there is no way that housing prices will increase.  Also, there will continue to be high rates of foreclosures and short sales in Middle Tennessee.

    Friday, September 25, 2009

    Effects of a Loan Modification, Short Sale, Foreclosure, Bankruptcy and Walking Away/Doing Nothing on Credit Scores

    Effects of a Loan Modification, Short Sale, Foreclosure, Bankruptcy and Walking Away/Doing Nothing on Your Credit Score

    There seems to be a lot of conflicting information out there regarding the negative effects of a Loan Modification, Short Sale, Foreclosure, Bankruptcy and Walking Away/Doing Nothing on a person's credit score. I would like to try to clear some of that confusion up.

    According to this Los Angeles Times article, Mortgage problems are walloping Americans' credit scores, loan modifications, short sales, foreclosures, bankruptcies and walking away/doing nothing effect your credit score differently. Below is a brief summary of the different options.

    • Loan Modification Type 1 - This Loan Modification type rolls late payments and penalties into the principal debt owed. According to the LA Times article, this type of loan modification may modestly increase your credit score.
    • Loan Modification Type 2 - This Loan Modification type is a refinancing of underwater (i.e. negative equity) mortgage(s). This is what is offered under the Obama administration's Making Home Affordable Program through government controlled Fannie and Freddie Mac. According to the LA Times article, this type of Loan Modification "may have little or no negative effect on scores, even though the homeowners might have been tottering on the edge of serious delinquency before refinancing."
    • Short Sale - A short sale is a sale of a property where the net sale proceeds are not sufficient to pay off the mortgage balance(s) and there is no party willing or able to make up the shortage. According to the LA Times article, a short sale may lower your credit score by 120-130 points. I have heard from other people that a short sale lowers a person's credit score by 80-100 points. For sake of simplicity, let's say that a short sale will drop your credit score by about 100 points on average (This does not include the negative effects of any missed mortgage payments. You do not need to miss any mortgage payments in order to successfully complete a short sale). While this seems bad (it certainly is not good), it is much better than foreclosure, or doing nothing. In fact, according Question 7, "If a borrower has completed a short sale and was never delinquent on that mortgage and is now attempting to purchase a new primary residence, will Fannie Mae purchase the loan?", in this this Fannie Mae publication, Announcement 08-16: Bankruptcy, Foreclosure, and Conversion of Principal Residence Policy Changes; and Revised Property Value Representation and Warranty Requirements, "If the borrower is purchasing a new property and the previous mortgage history complies with our excessive prior mortgage delinquency policy and does not have one or more 60-, 90-, 120-, or 150-day delinquencies reported within the 12 months prior to the credit report date, the loan is eligible for delivery to Fannie Mae, provided the lender or servicer who completed the short sale has not entered into any agreement that obligates the borrower to repay any amounts associated with the short sale, including a deficiency judgment." In other words, you can short sell your existing home and immediately buy another home as long you did not have a 60 day or more delinquency and your short sale lender did not require you to pay the shortage (normal loan underwriting criteria applies). This publication clarifies the previous Fannie Mae publication, Announcement 08-16.
    • Foreclosure - Homeowners that allow their home to go to full foreclosure (i.e. be auctioned off by the lender and/or become a bank owned property) should expect their credit scores to decline by 140 to 150 points plus negative marks on their credit bureau files for as long as seven years. Having a foreclosure on your credit report will also make it much more difficult to buy a home. Fannie Mae requires foreclosed home buyers to wait at least 5 years before buying another home and even then Fannie Mae will require larger down payments. Freddie Mac generally requires a waiting period of 7 years. The FHA currently has a waiting period of 3 years, but is expected to increase that waiting requirement.
    • Bankruptcy - The LA Times article states "People who file for bankruptcy protection covering all their debts (mortgage, credit cards, auto loans, etc.) will get hit with an average 355- to 365-point drop in their scores. Bankruptcies remain on borrowers' credit bureau files for 10 years." Having a bankruptcy on your credit report will make it very difficult to buy another home. Fannie Mae requires that people who file a non-Chapter 13 bankruptcy wait a minimum of 4 years from dismissal or discharge before obtaining a new home loan. For Chapter 13 bankruptcy, the waiting requirement is 2 years from discharge and 4 years from dismissal.
    • Walking Away/Doing Nothing - according to the LA Times article the "strategic default" has become common in large foreclosure laden markets such as California (and Florida, Nevada and Arizona). Homeowners who choose this option should expect the same consequences as a Foreclosure (described above).

    The LA Times article goes on to state that Americans overall credit scores have declined significantly over the last couple of years. The article refers to the Vantage credit score, the main competitor to the well known FICO credit score, which "rates borrowers on a scale range of 501 (subprime, the highest risk) to 990 (super-prime, the lowest risk). Unlike Fair Isaac Corp.'s FICO scoring system, whose scores can vary by 50 to 100 points based on which bureau supplied the underlying credit data, Vantage scores are about the same for each consumer."

    Regarding the negative effects of this financial mess on people's credit scores, the article states "For example, roughly 36.6 million of the 213 million consumers tracked by the three national credit bureaus in the first quarter of 2008 had Vantage scores above 900 -- the super-prime credit rung. That select group represented 17.2% of the country's consumers.But by the end of the second quarter of this year, just 15.4% -- 33.3 million out of 216.9 million individuals' files -- were left among the elite. By credit industry standards, that's huge. More Americans' scores are slipping into the worst credit category as well. In the third quarter of 2006, 34.4 million consumers were in the lowest segment -- 16.6% of 206.9 million individuals. But by the second quarter of this year, 18.3% of all files were in that category -- 39.8 million consumers out of 216.9 million. Most of these changes -- fewer people with excellent credit, more people in the lowest brackets -- have been caused by late payments on home mortgages, serious delinquencies, short sales and foreclosures, according to VantageScore researchers."

    The article does offer a glimmer of good news - the same information I have been saying for months. That is "the bottom-line good news about scores is that homeowners facing financial stress can experience minimal dings to their credit if they contact their loan servicer or lender early in the game -- when they first discover that they may have trouble making their monthly payments -- and take the first steps toward a loan modification or refinancing." In other words, doing nothing is the worst thing you can do. The article cautions financially distressed homeowners not to "wait and fall several payments behind before seeking a modification". The article quotes Barrett Burns, a former lender and now chief executive of VantageScore, as saying "Start that conversation early. You can lose 240 points on your score" and damage your ability to obtain credit for years.

    Based on the above, if you are a home owner who is experiencing difficult financial times and cannot afford to pay your mortgage, you should try to get a loan modification first. If a loan modification is not approved, or you cannot pay your mortgage even after a loan modification, then a short sale is your next best option.

    Due to the declines in people's credit scores as described above, the large number of homeowners in financial distress (due to a loss of income, unemployment, etc.), the large number of homeowners underwater (see my previous blog post, SCARY STUFF: About half of U.S. mortgages seen underwater by 2011), the relative attractiveness of short sales and the large numbers of homeowners who do nothing/walk away (this is a terrible decision) there will be a lot of short sales and foreclosures over the next several years.

    If you are a homeowner who cannot pay your mortgage (due to losing your job, having your income reduced, illness, health problems, etc.), or your home is already in foreclosure, or you owe more than your home is worth you should contact a real estate and/or bankruptcy attorney to discuss your legal options. You should also contact your mortgage company to inquire about a loan modification. If you a homeowner in Middle Tennessee and would like help and assistance with a loan modification please contact me for free no obligation assistance. If a loan modification will not work for you, or is not granted by your mortgage company, I can help you with a short sale of your property. I am a Middle Tennessee distressed real estate, short sale, pre-foreclosure (preforeclosure) and foreclosure REALTOR and Expert. I serve real estate owners, homeowners and investment property owners in Rutherford County TN, Williamson County TN, Davidson County TN, Murfreesboro TN, Smyrna TN, La Vergne TN, Eagleville TN, Lascassas TN, Rockvale TN, Christiana TN, Brentwood TN, Franklin TN, Nashville TN and Belle Meade TN. If you do need to short sell your home (a real estate short sale occurs when the sale proceeds are not sufficient to pay off all the mortgages and liens on the property/home), or you need a quick sale due to being in foreclosure, you can request short sale and foreclosure help and assistance on my website at Get Short Sale and Foreclosure Help and Assistance from a Middle Tennessee Short Sale and Foreclosure REALTOR and Real Estate Expert.

    Tuesday, September 22, 2009

    Moody's Puts Us in a Bad Mood: House Prices Won’t Return to Peak Until 2020

    According to this article, House Prices Won’t Return to Peak Until 2020: Moody’s Analyst, a Moody’s report predicts that "at least another decade will pass before housing prices return to peak 2006 levels." For those of you who have been following my blog you already know that I have been saying this for months now. In fact I have been saying that it will be at least 10 years before housing prices return to their 2005-2006 peak levels. The article quotes the Moody's report, written by Moody's Analyst Celia Chen, as stating "The correction will be not only deep but also lengthy. "The national price level will not regain its 2006 high until 2020, a peak-to-peak housing cycle of 14 years."

    Despite the 2020 projection being on the low end of my estimate (i.e. AT LEAST 10 years), this article actually confirms what I have been saying since according to the article, "the projection seems conservative in light of historic data."  The article states that the Moody's analyst wrote that after the Great Depression, housing prices took nearly 20 years to return to their previous peak. the report also shows that in Japan 15 years passed since their residential market lost half of its value and there are still no signs of a recovery.

    The further quotes the Moody's report as saying "housing prices will regain normalized rates of appreciation during the first five years of the recovery. But the decline in prices and the subsequent recovery vary by region to region. In some states, prices will decline 6% or less and recovery will come before 2014. Other areas that have experienced declines of more than 46% won’t get back to 2006 prices until 2023."

    My prediction for Middle Tennessee is that the Middle TN housing market will not recover peak home values until 2023-2025.  This is due to the following characteristics of the Middle Tennessee housing market:
    • The Middle TN housing market peaked much later than most areas of the country with a peak of late 2007/early 2008 instead of early to late 2006.
    • Extreme overbuilding during that peak especially in the higher price ranges.  This supply balance will continue for many years since for some reason people are still building here.
    • Tennessee has historically high rates of personal bankruptcy which will cause higher than average foreclosure and short sale rates.
    • Tennessee has higher than average unemployment rates, which will also cause higher than average foreclosure and short sale rates.

    Monday, September 21, 2009

    Forecast Predicts Nashville Job Market Will Recover in 2012

    According to this Nashville Business Journal article, Nashville predicted to recover in 2012, the Nashville metropolitan job market will return to pre-recession job levels in 2012 along with Memphis, Atlanta, Philadelphia, New Orleans, New York City, Boston and 12 other metropolitan areas. According to the article Austin and San Antonio in Texas will recover in 2010 and Dallas-Fort Worth and Houston and 6 other metropolitan areas will recover in 2011.

    While all this sounds good, I am reasonably certain that it is not correct if by "pre-recession job levels" they are referring to the 4.5-5.5% unemployment rates that were the norm from 2004-2006. Those unemployment levels would certainly be welcome given that we now live in the era of 10%+ unemployment levels (10.8% for the state of TN in August 2009 according to the Tennessee Commissioner of Labor & Workforce Development James Neeley). Unfortunately, I cannot see how that can happen. The low unemployment rates of 2004-2006 were 70%+/- fueled by consumer spending that enabled businesses to sell products and services and, therefore, hire more employees. That consumer spending was enabled by cheap and easy to obtain debt (think HELOC's, credit cards, auto loans, personal loans, etc.). That debt is now largely gone, or at least significantly reduced.

    Therefore, my problem with this article's rosy "pre-recession job levels" prediction is that it does not make sense. How can we return to "pre-recession job levels" if the consumer spending that created that low unemployment no longer exists? The answer is we can't and job levels will not return to "pre-recession job levels" for many, many years. I predict that unemployment rates will drop (i.e. the job market will improve), but the unemployment rates will stabilize at around 6.0-8.0%.

    This will all negatively impact housing prices and ensure that foreclosures and short sales remain at relatively high levels for the next several years even after the job market recovers. Simply put, less people will be employed and, as a result, there will be less home buyers.

    Saturday, September 19, 2009

    FHA in Deep Trouble: Default Rates Skyrocketing

    According to this Nashville Business Journal article, FHA reserves feeling the squeeze, and this CNBC article, FHA Cash Reserves to Fall Below Required Levels, high levels of FHA loan defaults have pushed FHA cash reserves below the mandated minimum levels.

    Both articles state that the head of the FHA said that the agency will not need a tax payer bailout, that the FHA will hire a chief risk officer and that underwriting criteria will be tightened including higher minimum credit scores and stricter appraisal rules. The Nashville Business Journal article quotes the new release statements of FHA Commissioner David H. Stevens as saying "To be clear, the fund's reserves are sufficient to cover our future losses, so the FHA will not require taxpayer assistance or new Congressional action. That said, given the size and scope of the FHA and its importance to today's market, these risk management and credit policy changes are important steps in strengthening the FHA fund, by ensuring that lenders have proper and sufficient protections."

    According to the Nashville Business Journal article, the FHA has become an increasing source of mortgages for first time homebuyers. The problem is that the article also quotes a statistic from the Mortgage Brokers Association, which shows that about 1 in 6 FHA borrowers were behind on their mortgage payments (i.e. in default). That is a 16.67% mortgage default rate.  In other words it is TERRIBLE!  This will ultimately lead to lots of FHA foreclosures and short sales.

    While I would like to believe the FHA's statements about not needing a bailout, I cannot. Mark my words, the FHA will indeed need a bailout. You just cannot lend people 96.5% of the purchase price of their home in a declining market and not expect large numbers of foreclosures. Even if the market was flat the FHA buyers would have negative equity due to the cost of selling a home exceeding their down payment.

    Due to the Middle Tennessee housing market having relatively lower housing prices and incomes than other areas of the country, there are a lot of FHA home purchases. As a result expect a lot of FHA foreclosures and short sales in Middle Tennessee.

    Friday, September 18, 2009

    What the Government Should Do to Help the Housing Market: Stop Meddling in Housing and FIX THE ECONOMY

    How should the government fix the housing market? The answer, stop meddling in the housing market. Instead, the government should focus on the economy. The fundamental question is why have jobs been leaving the US for the last 3 decades? Answer: taxes, government regulations (think environmental regulations that punish companies while doing nothing to help the economy such as CO2 emissions, etc., hiring quotas, employment laws, etc.) and labor unions. Fix those problems and employment and income rises. After several years maybe incomes will catch up enough and housing prices will fall enough that we actually reach a sustainable ratio of median home prices to median incomes (normally median home prices in an area are 3x incomes in that area) when overall employment is stable.

    Right now we have increasing unemployment, increasing foreclosures and short sales, but artificial government meddling. This is causing confusion and chaos. For those who think we can ride this out with a 1 year extension of the tax credit, etc., please look at the stats. Foreclosures will remain at very high levels for 3-5 years and at high levels for several years beyond that. Unemployment, will start to go down in about 12-18 months, but it will not go back down to the 4.5%-5.5% levels of 2004-2005 because the economy (and the employment market) was so dependent on consumer spending and that spending will not come back since it was fueled and enabled by easily obtainable debt that is no longer available.

    While this mess hurts me right now as a REALTOR and a homeowner who is trying to sell their home due a relocation, I know this is true. Declining housing prices are good for the economy. It will free up homeowners' capital that can be spent and/or invested in other areas instead of being sucked up by artificially high housing payments. It will enable people to actually eventually own their own homes and live with less debt and stress instead of living on the absolute edge. It is better to pay less for a home with higher interest rates then to pay more (and borrow more) at lower rates. This is all just a deleveraging of the US economy, which IS NECESSARY.

    Mark my words, eventually the government subsidizing of the real estate market will end and the housing market will decline more. It is unavoidable.

    Tuesday, September 15, 2009

    My Thoughts on the "Doomed" Housing Market: Listen When "Dr. Doom" Speaks

    According to this CNBC article, US Economy Facing 'Death by a Thousand Cuts': Roubini, Nouriel Roubini says "more banks will fail and residential real estate prices have more room to decline."  According to Roubini, the economy faces a real threat of a "double dip" recession due to the severely damaged financial system and a lack of consumer spending.  Roubini says "the securitization market is all but dead, the credit markets are still frozen and consumers will continue to save more rather than spend and boost growth."  He predicts that by the time this financial and economic crisis is all over the following will happen:
    • More than 1,000 financial institutions could fail.
    • Housing prices will likely to fall another 12 percent in the next year making the total decline approximately 40 percent since the market began its steep decline. This will result in nearly one half of all homeowners owing more on their mortgages than their houses are worth.
    Regarding housing construction, Roubini states "The gap between supply and demand is so huge we could stop producing new homes for a year to get rid of all the inventory  This price adjustment, in my opinion, is going to continue for another year."

    Regarding commercial real estate, he warns that regulators are repeating some of the same mistakes made during the financial crisis. He states "Allowing forbearance in the deeply troubled sector will mask underlying problems that will come back and bite the economy".

    While I do have a BA degree with a major in Economics from an Ivy League University, I am not a professor or professional economist.  However, I have been saying much of the same for months now.  That is that housing prices are still too high and there is still too much new construction.  We do not need new construction reduced to such and such levels - we need all new spec construction to come to a halt for at least a year.  Of course, that will not happen.  Instead new homes will be built, housing will continue to decline, more short sales and foreclosures will occur and more bailouts will be doled out to foolish banks and lenders.  It's an endless cycle of disaster.

    With respect to the Middle Tennessee real estate market:
    • Rutherford County Tennessee: Murfreesboro TN, Smyrna TN and La Vergne TN (LaVergne TN)
    • Williamson County Tennessee: Brentwood TN and Franklin TN
    • Davidson County Tennessee: Nashville TN and Belle Meade TN
    I have been saying since I moved here in September 2008 that the Middle Tennessee housing and commercial real estate market is significantly over built and that housing prices are still too high.  Since the peak of the real estate market in Middle Tennessee occurred in late 2007/early 2008 (i.e. 2 years later than most places) the market here will decline for a few more years.  Also, a large portion of the homes sold with 95-100% subprime and FHA financing which have high default rates so short sales and foreclosures will be high in Middle Tennessee.  Therefore, I predict that the Middle Tennessee real estate market will do worse than the US average over the next few years.

    Monday, September 14, 2009

    Navigating Short Sales - Help and Assistance for Sellers Who May Need to Sell via a Short Sale

    The information below is intended to provide help and assistance for sellers who may need to sell their home via s short sale as a result of a personal hardship (i.e. illness, job or income loss, etc.) and their home being worth less than the total mortgage balances. This information is valuable for sellers in any area of the country. However, I personally service the following areas in Middle Tennessee:
    • Rutherford County Tennessee: Murfreesboro TN, Smyrna TN and La Vergne TN (LaVergne TN)
    • Williamson County Tennessee: Brentwood TN and Franklin TN
    • Davidson County Tennessee: Nashville TN and Belle Meade TN

    Navigating Short Sales: What to Do When the Sale Price Leaves You Short

    If you're thinking of selling your home, and you expect that the total amount you owe on your mortgage will be greater than the selling price of your home, you may be facing a short sale. A short sale is one where the net proceeds from the sale won't cover your total mortgage obligation and closing costs, and you don't have other sources of money to cover the deficiency. A short sale is different from a foreclosure, which is when your lender takes title of your home through a lengthy legal process and then sells it.

    1. Consider loan modification first. If you are thinking of selling your home because of financial difficulties and you anticipate a short sale, first contact your lender to see if it has any programs to help you stay in your home. Your lender may agree to a modification such as:
    • Refinancing your loan at a lower interest rate
    • Providing a different payment plan to help you get caught up
    • Providing a forbearance period if your situation is temporary
    When a loan modification still isn’t enough to relieve your financial problems, a short sale could be your best option if
    • Your property is worth less than the total mortgage you owe on it.
    • You have a financial hardship, such as a job loss or major medical bills.
    • You have contacted your lender and it is willing to entertain a short sale.
    2. Hire a qualified team. The first step to a short sale is to hire a qualified real estate professional* and a real estate attorney who specialize in short sales. Interview at least three candidates for each and look for prior short-sale experience. Short sales have proliferated only in the last few years, so it may be hard to find practitioners who have closed a lot of short sales. You want to work with those who demonstrate a thorough working knowledge of the short-sale process and who won't try to take advantage of your situation or pressure you to do something that isn't in your best interest.
    A qualified real estate professional can:
    • Provide you with a comparative market analysis (CMA) or broker price opinion (BPO).
    • Help you set an appropriate listing price for your home, market the home, and get it sold.
    • Put special language in the MLS that indicates your home is a short sale and that lender approval is needed (all MLSs permit, and some now require, that the short-sale status be disclosed to potential buyers).
    • Ease the process of working with your lender or lenders.
    • Negotiate the contract with the buyers.
    • Help you put together the short-sale package to send to your lender (or lenders, if you have more than one mortgage) for approval. You can’t sell your home without your lender and any other lien holders agreeing to the sale and releasing the lien so that the buyers can get clear title.
    3. Begin gathering documentation before any offers come in. Your lender will give you a list of documents it requires to consider a short sale. The short-sale “package” that accompanies any offer typically must include
    • A hardship letter detailing your financial situation and why you need the short sale
    • A copy of the purchase contract and listing agreement
    • Proof of your income and assets
    • Copies of your federal income tax returns for the past two years
    4. Prepare buyers for a lengthy waiting period. Even if you're well organized and have all the documents in place, be prepared for a long process. Waiting for your lender’s review of the short-sale package can take several weeks to months. Some experts say:
    • If you have only one mortgage, the review can take about two months.
    • With a first and second mortgage with the same lender, the review can take about three months.
    • With two or more mortgages with different lenders, it can take four months or longer.
    When the bank does respond, it can approve the short sale, make a counteroffer, or deny the short sale. The last two actions can lengthen the process or put you back at square one. (Your real estate attorney and real estate professional, with your authorization, can work your lender’s loss mitigation department on your behalf to prepare the proper documentation and speed the process along.)
    5. Don't expect a short sale to solve your financial problems. Even if your lender does approve the short sale, it may not be the end of all your financial woes. Here are some things to keep in mind:
    • You may be asked by your lender to sign a promissory note agreeing to pay back the amount of your loan not paid off by the short sale. If your financial hardship is permanent and you can’t pay back the balance, talk with your real estate attorney about your options.
    • Any amount of your mortgage that is forgiven by your lender is typically considered income, and you may have to pay taxes on that amount. Under a temporary measure passed in 2007, the Mortgage Forgiveness Debt Relief Act and Debt Cancellation Act, homeowners can exclude debt forgiveness on their federal tax returns from income for loans discharged in calendar years 2007 through 2012. Be sure to consult your real estate attorney and your accountant to see whether you qualify.
    • Having a portion of your debt forgiven may have an adverse effect on your credit score. However, a short sale will impact your credit score less than foreclosure and bankruptcy.
    Note: This article provides general information only. Information is not provided as advice for a specific matter. Laws vary from state to state. For advice on a specific matter, consult your attorney or CPA. 
    Reprinted from REALTOR® magazine ( with permission of the NATIONAL ASSOCIATION OF REALTORS®.
    Copyright 2008. All rights reserved.

    Saturday, September 12, 2009

    Residential Home Sales Market Statistics: A Comparison of Normal Sales versus Short Sales and Foreclosures in August 2009

    Middle Tennessee Residential Property Foreclosure Activity Report
    Residential Real Estate Market Sales Activity - Foreclosures, Pre-foreclosures and Short Sales Compared to Regular Listings
    Counties & Cities/Towns Covered:
    Rutherford County Tennessee: Murfreesboro TN, Smyrna TN and La Vergne TN (LaVergne TN)
    Williamson County Tennessee: Brentwood TN and Franklin TN
    Month & Year
    August 2009
    Start Date
    End Date
    Active Listings - Total
    Active Listings - % Foreclosures & Short Sales
    Pending Sales - % Foreclosures & Short Sales
    Months of Residential Inventory Based on Pending Sales Rate
    La Vergne
    Totals & Averages
    As you can see from the chart above the percentage of Pending Sales that are distress sales (Foreclosures and Short Sales) is greater than their representation as a percentage of Active Listings.  This means that these distressed listings are Pending (i.e. selling) at a faster rate then regular listings.