http://www.sellsandiego.com/ San Diego Real Estate, San Diego Condos and San Diego Townhomes en-US http://blogs.law.harvard.edu/tech/rss Troy Stortz - The Short Sale Option by David Knox David Knox, President of David Knox Productions, Inc., discusses a very serious situation for the San Diego Downtown homeowner, the financially distressed property, where the mortgage exceeds the value of the home and the owner is behind on the payments. When a San Diego Downtown home buyer first purchases a home, the price paid is equal to the value of the home at that time. A percentage of savings are paid as equity then the balance is covered by a mortgage. Since then, negative factors around the real estate industry may have driven the value of the home that first consumes the home's equity, then eats into the mortgage, leaving a balance greater than the home is worth. At this point, there are no good options but only less painful ones, though most homeowners lose their home through the most painful way, through foreclosure. Knox lists 4 additional options to consider: Sell, Stay, Rent, and Short Sale. Selling at the market price would mean accepting the loss and trying to cover it with cash savings, life insurance or liquidating assets. This way would preserve credit rating and let the seller move on with life. Staying at the home and waiting for the market to improve is an option to consider if financial arrangements can be made to meet the monthly costs of keeping the home. However, Knox discusses the time value of money, and what it means to sell now, or waiting for a better time. If the San Diego Downtown home is within the rentable range of homes in its area, computing for the income gained for rent may lead to a viable solution. There are several challenges, though, in renting your home, such as finding renters, managing the property, maintaining utilities, and dealing with wear and tear, that, in most cases, the income and effort would not be worth the cost. Knox then explains short-sales and how much it can benefit the owner versus foreclosure, such as the ability to preserve credit rating. He also lists the qualifications for being eligible for a short-sale, including acceptable hardship, monthly shortfall, and insolvency. A step by step process is then outlined for those interested in going through a short-sale to avoid foreclosure. The actual short-sale package takes up to almost 150 pages of complete and accurate information that's impossible to include in the video, so professional help is necessary in order to finish the process. Knox closes by saying, "Before you assume your situation is hopeless, contact your real estate agent for a consultation. See if you're eligible for a short-sale and let them walk you through the process." For financially distressed Downtown San Diego home owners, contact Neuman & Neuman at 1-800-221-2210 for more helpful information. For further information on any Downtown San Diego Condos contact: Gregg Neuman Gregg@sellSanDiego.com 1-800-221-2210 www.SellSanDiego.com http://www.sellsandiego.com/the-short-sale-option-for-the-financially-distressed-downtown-san-diego-seller Freddie Mac has released the 2011 third quarter results of its refinance analysis, which show owners of San Diego condos who go into refinancing continue being able to strengthen financially by maintaining or lessening their mortgage loan debt. During this period of the year, more than 80 percent of owners of downtown San Diego condos who decided in refinancing their condominium mortgage maintained the exact loan amount or reduced the principal balance by giving out more cash at the closing table. Of the borrower-owners of San Diego condos, 47 percent of these who refinanced decided to maintain the same mortgage loan amount. On the other hand, almost 40 percent of refinancing condo owners decided to reduce their principal balance. Borrowers of cash out, particularly those that added significantly to their loan balance represented around 18 percent of refinanced loans. Likewise, the average share in cash-out during the period of 1985 to 2010 was about 46 percent. The net dollars of equity on downtown San Diego condos that were converted to cash to become part of an inflation-adjusted refinance were at their lowest in 16 years. During 2011's third quarter, $5.3 billion in estimated condo equity figures was cashed out when there was a refinancing of traditional prime-credit condominium mortgages. Such figure was reduced from $6.3 billion during the second quarter of the same year. It was substantially less compared to peak cash-out of 5 years ago, wherein the refinancing volume was $83.7 billion during the year 2006. Among the refinanced mortgage loans for San Diego condos in the analysis report of Freddie Mac, the mean value changes in collateral properties was in the negative 7 percent above the median; this was before the loan's life of five years. Compared to this is the Freddie Mac Price Index report, which reveals around 25 percent decline in refinance loan within U.S. series between the period of September of 2006 and September of 2011. Borrowers of San Diego condos, who refinanced during the third quarter of 2011 were able to own properties that held better in their value than the average condo. Likewise, such condominiums were able to reflect major improvements that owners had done on them within the intervening years. Basically, borrowers who refinanced their loans were able to reduce rates by as much as 1.2 percent points in the year 2011. This can be translated to significant savings for the following year. For more information about Downtown San Diego Condos contact: Gregg Neuman 1-800-221-2210 Contact the Neuman and Neuman Team www.SellSanDiego.com Find More San Diego Real Estate Here! http://www.sellsandiego.com/refinancing-owners-of-san-diego-condos-maintain-or-reduce-their-debt During the last part of 2011, fixed-rate loans of owners of San Diego condos account for almost 100 percent of refinance loans, according to a Freddie Mac Report. It is clear that refinancing borrowers of downtown San Diego condos prefer to obtain fixed-rate loans; this is whether their original mortgage loan was a fixed-rate or an adjustable-rate one. There is likewise an increase in refinancing borrowers who chose to shorten the terms of their loans. One-third of borrowers who obtained their fixed rate loan of 30 years selected to pay off 15 to 20 year term loans. This was the highest share of refinancing borrowers in the last decade. According to the same Freddie Mac report, 55 percent of borrowers of mortgages for their San Diego condos who possessed a hybrid ARM selected a fixed-rate type loan in the second quarter of 2011. On the other hand, the remaining 45 percent elected to go for refinancing with the same loan product. The refinancing share from one hybrid ARM to another has been the biggest since the second portion of 2004. Fixed mortgage rates among borrower-owners of downtown San Diego condos averaged almost 4.65 percent for those with 30-year loans. On the other hand, borrowers with fixed rate mortgage averaged 3.84 percent for their 15-year loan products. These figures were clearly well below the long term fix rate averages, according to Mortgage Market Survey Report by Freddie Mac. On the other hand, The Bureau of Economic Analysis has come up with the report that the average single-family loan coupon was pegged at the increasing figure of 5.3 percent during the 2011's second quarter. This resulted in the continued strong refinancing activities by borrowers into fixed-rate mortgage loans. According to the survey report, compared to a long 30-year, fixed mortgage loan rate, the interest rate assigned to a 15-year fixed mortgage rate was around 0.8 percentage points down during 2011's second quarter. For borrowers of San Diego condos who are enticed to go into refinancing because of low fixed-mortgage rates, it is possible for them to enjoy even lower interest rates by cutting short their loan term. The initial interest loan rate on a hybrid ARM was around 1.2 percent points, which is much lower than that of a 30-year long, fixed-rate mortgage loan. For borrowers who have plans of remaining in their current San Diego condos for just a couple of years, it is a welcome fact that hybrid ARM permits for even greater amount of interest-rate savings. For more information about Downtown San Diego Condos contact: Gregg Neuman 1-800-221-2210 Contact the Neuman and Neuman Team www.SellSanDiego.com Find More San Diego Real Estate Here! http://www.sellsandiego.com/most-refinancing-owners-of-san-diego-condos-choose-fixed-rate-loans