Many homeowners choose to walk away from their mortgage even if they can afford to make payments because the value of their property has declined.  It is called Strategic Default.  They feel it is a beneficial reaction to an upside down mortgage.

The difference between a regular default and a strategic default is that on a regular default, the homeowner has a real hardship due to job loss, divorce, or other circumstances brought about by the current economic condition.  On a  strategic default, the homeowner simply chooses to stop making payments even if they can afford to make payments because they feel that they had made a bad investment.

A default is rarely strategic and causes extreme damage to your credit and carries financial consequences.  Lenders are looking for ways to avoid the foreclosure process as much as homeowners.  The US  Treasury announced new incentives  to simplify the short sale process through the HAFA program which will start on April.

Be sure to consult and educate yourself as to what your options are.  As a CDPE designated agent, I can provide you with a safer alternatives to foreclosure.  I have prepared a free report to educate and help you determine the best route to take. Just call my 24 hour Free Recorded Message at (877)-519-8587 extension 84 to get a copy of the report.

Elizabeth M. Eugenio, (909) 376-8615, Email: Elizabeth@HomesbyLiz.info

Certified Distressed Property Expert (CDPE), Certified Residential Specialist (CRS), Graduate Realtor Institute (GRI)

www.HomesByLiz.com, www.ChinoHillsCARealEstate.com

Is Walking Away The Right Thing To Do? is a post from: Chino Hills Real Estate Resource Center

A short sale is when a homeowner owes more than what the house can sell for.  If a homeowner has a loan of $450,000 and the value of the home is now only $380,000, the lender on a short sale will pay for the deficiency of $70,000 plus the cost of selling the home.  Why will the lenders take this loss?  Because they do not want to take back the property in  foreclosure.  Lenders pay an additional $50,000 to $60,000 for every home that goes to foreclosure after they pay for their holding cost, attorney’s fees, get the home cleaned out and maintained, change the locks and keep the home in their inventory longer before the home sells as an REO (Real Estate Owned).  In some cases, there may be 2 or more loans against the property. When a property goes to foreclosure, it creates a 9% decline in property values in the neighborhood.  If we can all be more proactive in informing our friends that they have better options than foreclosure, we would be helping the economy.

A  homeowner who loses a home to foreclosure becomes ineligible to get a Fannie Mae backed loan for a period of 5 years, whereas a homeowner who choses to do a short sale will be eligible only after 2 years.  Now that Fannie Mae and Fredie Mac loans make up for a big percentage of loans being written, it is best to avoid that negative consequence.

Additionally, when employers do credit check on applicants or current employees, a foreclosure can have a very detrimental effect on the employee and in some cases, when employees hold  sensitive position could be a ground for reassignment or termination.  A short sale is not reported on a credit history and therefore is not a challenge to employment.  “The loan is typically reported as “paid in full, settled”.

Ask me about short sales if you want more information.

Elizabeth M. Eugenio, (909) 376-8615

Email:  Elizabeth@HomesByLiz.com, Website: www.HomesByLiz.com

Certified Distressed Property Expert (CDPE),  Certified Residential Specialist (CRS), Graduate Realtor Institute (GRI).

Why Avoid Foreclosure? is a post from: Chino Hills Real Estate Resource Center

With the present economy, job layoffs, adjustable rate mortgages and declining home value, we see many people having difficulty making payments and facing the possibility of loosing their home.  Many homeowners do not get help nor even contact their lenders.  Many are so distressed they do not know what to do so they end up getting foreclosed.  

There is help for you.  You can avoid foreclosure.  Get the expertise necessary to save your credit, your family and relieve you of the uncertainty.    There are several options for you.  Short sale is one of them and loan modification is another one.  It is best that you talk to an expert who can guide you in choosing the better way out.  Arm yourself with information.   Log on today at: www.ShortSaleOnlineHelp.com to find out about short sales. 

Whatever you do, make sure you are dealing with an expert who knows what they are doing and most of all someone who will work for your best interest. 

As a Certified Short Sale Expert, it is my goal to educate  and counsel clients to avoid foreclosure.  Give me a call and learn a better way out.   

Avoid foreclosure is a post from: Chino Hills Real Estate Resource Center