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16July

HomeTelos LEO – Real Benefits for Homeowners, Agents and Lenders

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HomeTelos LEO (Loan Exit Option) has been working with qualified homeowners to eliminate their mortgage and provide an alternative to the traditional short sale since October 2008.  During that time, 33 properties have been successfully sold with the following feedback from participating listing brokers:

“It was a great program.  I hope to be able to participate in more transactions.  This is the way to do a short sale.”

“I was impressed with the fact that the timelines were adhered to.  The cooperation from the seller and that of HomeTelos was superb.   My transaction starting with the listing to the closing was very smooth.  I was able to price the property at market value, received four (4) offers and ended up closing it with a cash deal in a very short period of time.”

“This program is great.  The homeowners are happy the agents are happy and most importantly the buyers are happy.  Real Estate agents are pleased to show their clients these properties, they know it is priced correctly and their buyers will receive a quick response.  Local escrow and title companies are involved which make the other agents and businesses happy.”

“Excellent.  The homeowner was cooperative.  The property was well maintained, the pricing was in line with my BPO, the sale occurred quickly and closing happened on time.  I think this program is great!!!  It is significantly better than a normal short sale process.”

“I  would rate this program very high. I specialize in short sales and bank owned properties. My traditional short sales are taking on average six months to get closed. This home took less than ninety days to sell. The buyer’s agent knew the price was an approved price which helped tremendously, and I believe the bank will gain a better offer with an approved price up front. The borrower/seller was very cooperative. It was so nice to have the bank already have all of his financial paperwork and already have it reviewed in advance. “

“From a scale of 1-10.  HomeTelos is a “10”. The homeowner involvement is crucial for this program to work. If this home was not “prepped” for showing we would not have gotten an offer this quick.  The homeowner was on board with the program 100% from the beginning and that is what made it successful.”

It is obvious that the current “as is” short sale process needs improvement.  HomeTelos LEO has developed a process that eliminates many of the headaches and pitfalls encountered by real estate professionals and homeowners who are desperately searching for an answer to their housing situation. We’ll continue to keep you updated on the latest news from this amazing program and the response of the real estate community to an alternative that finally addresses their frustrations and need for an easier, timelier resolution to the short sale dilemma.

14July

Facing Foreclosure? 5 Things You “CAN” Do

Many Americans are either facing foreclosure, behind on their mortgage or upside down … owe more than they can sell their home for.  If you are one of those people, here are 5 simple things you “can” do to deal with the issue and find a solution or resolution. 

1.    Don’t Put off Dealing with the Issue.  Or as some would say, “don’t be in denial about it.”  The worst thing you can do if you are behind on your mortgage or facing foreclosure is to avoid the issue and do nothing.  We are going through one of the most challenging financial times in years and becoming paralyzed by fear is not the answer.  In addition, you should be careful to avoid falling into the trap of believing “you’re the only one” or “you’re a failure” because you’re in this situation.  Financial challenges happen to the best of us. The good news is, you can recover and rebuild later.  For now, take responsibility, own up to the situation you’re in and don’t let fear and avoidance control you.  It never accomplishes anything constructive. 

2.    Consult a Real Estate Agent.  If you need to get out from under your mortgage, talk to a real estate agent you know and trust.  Real estate agents are professionals and they can give you an idea of the market value of your home and the actual costs involved in selling it.  Even if your home is not market ready and needs a lot of work, they may know someone willing to buy it as-is … even if it is not in perfect shape.  Real estate agents can also help you be realistic about the value of your home.  If you are truly upside down and can’t sell your home for what you owe on it, they will tell you.  This can be the first and easiest step to taking responsibility and finding out what your options are. 

3.    Seek Advice.  Once you know the market value of your home, the costs involved and whether you can sell it or not, seek advice from trusted friends or professionals like an accountant, attorney or financial planner. Renting your home instead of selling it might be an option, so get some good advice before making a life-changing decision like selling your home.  The hardest thing for many people to do is to ask for help but it’s the BEST thing you can do.  It is much easier to face a challenge of this magnitude with someone else than by yourself.  Think of your favorite stories or movies.  There is always a “fellowship” of some kind.  Frodo and Sam, Dorothy, the Tin Man, Scarecrow and Lion, the four siblings in Narnia.  Don’t try to go it alone.  No one ever succeeds alone.  Get some good advice and support from others. 

4.    Call Your Lender.  If you find yourself upside down and can’t sell your home for what you owe, call your lender and ask them what are your options.  Many lenders are willing to work with homeowners on the terms of repayment.  Some are not, so a phone call to them is essential.  If you have fallen behind on your payments and they are calling you, talk to them … and most of all, don’t avoid them.  If they are uncooperative or have turned your account over to a collection agency, know your rights under the Fair Debt Collection Practices Act (FDCPA).   

5.    Call HomeTelos.  If you truly need to get out from under your mortgage and owe more than you can sell it for, you may qualify for the HomeTelos Loan Exit Option (LEO) program.  The goal of the Loan Exit Option program is to exit your mortgage loan by completing a pre-approved “short sale” at a pre-determined price.  A short sale results when a homeowner sells the home for an amount that is not adequate to repay the mortgage loan, but the mortgage lender agrees to accept the sales proceeds and release its lien. The lender typically accepts the sales proceeds in full satisfaction of the borrower’s loan, thus helping you to avoid a foreclosure on your credit record. HomeTelos LEO Program short sales are pre-approved by the mortgage lender so they are very different from a traditional short sale. Homeowners participating in the LEO program BEGIN with a letter that defines the lender’s loan settlement terms. This letter includes a minimum sales price for the home based on its current market value, thereby avoiding all the delays and headaches of most short sales. For more information on the LEO program and to find out if you qualify, you can call HomeTelos at 1-866-99Telos between 8:00 and 5:00 central standard time. 

Facing foreclosure can be one of the most challenging and stressful events you ever face, so seek good professional advice, take responsibility and don’t try to go it alone.  You need help navigating this situation and there are many options to consider. 

2March

Wear Your Name Badge

I was on the plane traveling from Orlando to Dallas (via Houston), when, wouldn’t you know it, I found myself surrounded by Keller Williams’ brokers and associates! I know the shuttle was one classroom-in-miniature, but now I had another opportunity.  I seized the day!!

I took note of the lady beside me in seat A, since she was professionally dressed on a 9pm flight. Comfort is sometimes the priority when you are “just flying”, but I’ve found that what you wear earns attention! So, of course, I paid attention (something all the women in my family seem to do).  Her name badge caught my eye, _____ Keller Williams. Could this be? Have I been given another opportunity to talk real estate? With my passion for real estate, it is an enjoyable subject for me, so it’s hardly “work”.

I began my “questionnaire” … Have you utilized BidSelect, do you specialize in REO’s, how do you feel about the real estate industry today, and so forth. Then I began my explanation of “Look what is available to you and your office!” She seemed pleased with the possibilities, but shared with me that she was very overwhelmed by all the technology that was introduced at the National Convention she had attended, even after being in real estate for many years.  She also told me how frustrating short sales are. My goodness, am I a natural at setting the stage or what?! I talked about BidSelect and its user-friendly features. I talked about the wonderful cooperative sale offered through HomeTelos.  Then I explained how the services of our brokers in REO make them the cream of the crop (which we are always looking for!). At this point, a tap on my shoulder was followed by “May I have your card? I have been eavesdropping, and I too am a Keller Williams broker. I am very interested in what you have been saying.” I was surrounded!!!! I gave my cards out and received some. (So glad I keep my cards readily available!!! Hint, hint!)

This all began because a real estate professional wore her name badge. When I was teaching real estate classes, I would say, “One of the least expensive, yet most valuable marketing tools you can use is wearing your name badge… everywhere!”  Except, perhaps, church.

Until next time, I’m back on the road. Take care, and remember to Wear Your Name Badge!

25February

A Captive Audience

Greetings to all!

Here I am, waiting to board another plane for another adventure! I could not ask for a better job; traveling to interesting places, meeting new foks and greeting familiar acquaintances!

Speaking of which… I was coming back from the NAREB Mid-Winter Conference in Fort Lauderdale (by the way, my invitation was much appreciated, and I had a great experience interacting with well-versed and experienced brokers!), on my way to Orlando for a couple of days of R&R, and the shuttle from the airport to hotel had us all packed in – sardine style! To my delight, I found myself surrounded by several Keller Williams brokers from five different states! They were discussing their upcoming National Convention and how real estate was changing in their areas. I just could not contain myself! I introduced myself and began the inquiry of where are you from, how large is your office, what is the primary real estate service that you provide and so on… (My mother is a therapist and has taught me well on the “This Is Your Life survey”!) I had a captive and captivated audience, so I proceeded to ask if they’ve used BidSelect, are they aware of a cooperative sale, are they active in REO listings and who with and how are the technology products they use working for them? After giving a brief synopsis of BidSelect, HomeTelos, HomeTracker and First Preston HT’s services for REOs, I received quite a lot of positive inquiries about them all and handed out quite a lot of cards! Naturally, I collected as many cards as were available.  What an exciting and impromptu class I had! I could do this for a lifetime!!!!

Well, I am in another airport, leaving from my mini getaway and recharged for my adventures in Tennessee! I have two upcoming HUD seminars — Nashville on the 26th and Memphis on the 27th.

Until next time, I’m back on the road.

27January

Short Sales – Good Decision? (Part 3 of 3)

In parts 1 and 2 of our short sale blog, we discussed the initials steps in preparing your file for a short sale. Because of the state of the mortgage industry today, many individuals have opted for this route in trying to alleviate themselves of the financial responsibility of a home mortgage. As was noted, this route is usually a great scenario for the homeowner, but the lender is usually less responsive to your requests for a short sale. This is primarily due to several factors: (1) There is an abundance of short sale requests because of the state of the economy, the crater of the subprime market, and the rate adjustment of Adjustable Rate Mortgages; (2) Many loss mitigation specialists are not bonused on short sales rather on loan modifications. Many times these individuals will not assist you from start to finish on a short sale. Rather, your file is held in “suspension” until a foreclosure takes place; (3) The ease of a foreclosure is the path of least resistance many lenders prefer to take rather than allow you to sell your home through a short sale.

When we finished the last blog, we had presented your full file to the lender and they had in turn packaged your offer and HUD-1, your current financial package, and the BPO from a third party. As we discussed, the presentation of a FULL FILE to a lender is imperative. Because of the influx of so many short sales in the market, lenders will often put aside partial files and present full files to the investor. The presentation of a full package to the investor is critical because many times you are racing against the foreclosure clock. In many states it take 6 to 8 months for a home to fall into foreclosure. However, I have seen lenders foreclose on properties in as little as 4 months from the first missed payment. Each state has its own laws governing the steps of a home foreclosure, so it would be in your best interest to research the timeline to eleviate a certain missed opportunity for a short sale.

Once the investor has researched your file, he will more than likely accept the offer. Many times lenders don’t present offers that are off the mark of the third party BPO. This saves everyone time and allows all parties to follow through with the sale of the home. Once the investor has accepted the offer, the lender will then prepare an acceptance letter of the offer. The acceptance letter will be based on the offer that was outlined on the HUD-1 that was submitted with the offer. It is imperative to note that the investor approves the offer based on the information in the HUD-1. Always double check the title officer’s work on the HUD-1. You want to make sure of this because contracts vary from state to state, but the HUD-1 is the universal tool all of them use to approve, deny, or counter a contract.

Generally, the buyer has 30 days from the acceptance of the offer to close the transaction. The items that will need to be collected during the review of the contract are: (1) A current title run by the title office. Because there can be multiple liens (mechanics liens, federal tax liens, HOA liens, etc) placed on a property, it is imperative to have a run sheet detailing a clean chain of title; (2) HOA resale certificate (if applicable). If the HOA has had to mow your lawn or fax a fallen fence, etc., they will many times not issue a resale certificate because of these infractions. These items will of course need to be paid and brought current to sell the home; (3) Communcation of the buyers lender. Because of the current mortgage market, you do not want to jump through so many hoops in the preparation of sale only to find out that the buyer can no longer qualify for the home because he/she has had credit problems in the interim or did not sell their previous home. Remember, the squeaky wheel will always transition yourself into a smooth sale of your home.

I will finish this final blog with a question that I always receive from short sale selling participants: am I going to be responsible for the deficiency between what is owed and what I sell my home for? The answer is: maybe. The reason for this is that it all depends on what your home is classified as: a homestead or investment property or second home. If your home is homesteaded, under the Debt Forgiveness Act of 2007, “…..the Act allows exclusion of income realized as a result of modification of the terms of the mortgage, or foreclosure on your principal residence.” (You can read more on this at www.irs.gov). If your home is an investment property or a second home, you will be responsible for the deficiency in the loan. Many times the lender will issue you a 1099-A and will write off their loss. You will then be responsible for the taxes as a result of the sale. Please remember, you will receive a deficiency whether you sell your home in a short sale or you allow it to go to foreclosure. Its much easier to erase late payments from your credit than to erase a foreclosure. Some lenders will place a judgement on your credit. The problem with this is that the judgement goes away in 10 years unless it is renewed. This is usually too much for a lender to keep up with.

I hope that this three part series has been a good tool to prepare yourself for a short sale. If you have any questions regarding the contents of this blog or would like to discuss other options for your home, feel free to contact me at tteichelman@firstpreston.com. Thank you.

13January

Fannie Mae Selects HomeTelos’ Lender Center to Support Its Property Preservation Activities

Dallas, TX. January 12, 2009 – Texas-based HomeTelosTM, LP announced today that Fannie Mae has selected the HomeTracker® Lender Center application as a workflow and document management solution to support communication, analysis, and decision-making by Fannie Mae related to property preservation efforts conducted by Fannie Mae mortgage servicers. 

The HomeTracker Lender Center solution allows Fannie Mae to streamline the process for receiving and responding to servicer requests for approval of property preservation expenses which would exceed Fannie Mae guidelines.  Lender Center manages a complete history of requests for approval, determinations, requests for clarification/explanation of determination, as well as providing information for an objective and auditable review process. This technology standardizes rules and processes for all users, dramatically increasing the resolution of first time requests, and helping both Fannie Mae and mortgage servicers better leverage resources. 

The Lender Center application, launched in 2003, has facilitated the processing of over 300,000 property preservation determinations, and is widely used by major mortgage servicing institutions.  It has reduced the re-submission rate of requests on average from 87% to 17%, and decreased the response time for property preservation requests from 10 days to 2 days. 

About HomeTelos, LP: HomeTelos, headquartered in Dallas, Texas, specializes in the development and support of web-based solutions for troubled assets and Real Estate Owned (REO) asset management and communication. Its suite of applications has supported more than 250,000 properties and vastly improved efficiency and communication among all parties in the pre-foreclosure and REO processes.   HomeTelos delivers solutions that reduce holding time and costs while improving workflow efficiency and communications. 

For more information, visit www.hometelos.com or call (800) 934-1836.

29December

HomeTelos’ holiday spirit and Jonathan’s Place

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On December 23rd, HomeTelos delivered over $300 in super-store gift cards, a truck-load of kids’ clothing and other great stuff from the Needs List posted by Jonathan’s Place. The donations were generously given by HomeTelos team members and their children.

Why, you ask? As the holidays were approaching, we at HomeTelos wanted engage our families in helping to give back to the community. After receiving some great suggestions from the team, we landed upon Jonathan’s Place and were deeply moved by the extraordinary service this non-profit organization provides to our North Texas community.

What is Jonathan’s Place? A few snippets from their amazing website…

We are an emergency shelter for abused, abandoned and neglected children, age newborn to 17 years. We are the only licensed emergency shelter in the area that serves children under the age of ten (10).

The main program of Jonathan’s Place is serving the abused, abandoned and neglected children of North Texas as an emergency shelter, providing temporary residential and treatment services. This has been the main focus of Jonathan’s Place since the fall of 1999.

Jonathan’s Place is also a Foster & Adoptive Family Program – recruiting, training and verifying foster, foster-to-adopt and adoptive families. We then place children from Child Protective Services and our emergency shelter into their care.”

Many thanks to the HomeTelos team and their families who participated in this grass-roots program to lend a hand to some of our local community’s most vulnerable children this holiday season. We hope that you continue to keep Jonathan’s Place in your thoughts throughout the year.

29December

Short Sales – Good Decision? (Part 2 of 3)

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In part one of this discussion, I talked about the initial steps that are involved in starting a short sale process. As with all short sales, this option is not necessarily the first line of defense a lender wants to take in releasing the lien and ultimately your financial responsibility in a property. The path of least resistance for any and all lenders is a loan restruction (some use the name loan modification). Although a loan modification sounds like a great idea, most individuals who have either lost their job or the ARM that the lender has placed them in is not the best route to take in relieving your financial responsibility to the lender of your property. A short sale is usually a great option for a home owner who just needs to get out of the loan they are in. With a sagging housing market and lenders going out of business daily, reselling this asset can be tough.

Another item of importance that was discussed in the last blog was preparing the paperwork that is necessary for a bank to approve a short sale. This paperwork includes: the last two years of tax returns, current pay stubs, bank statements, 1099 forms, and utility bill information. This collection of data is critical in that it demonstrates to the lender that you can no longer keep up with the current note on the property. This data is also important in that it shows that you are willing and able to disclose your financial history to the bank to show them that you want to work with them to sell your home so that they don’t necessarily need to take the home to foreclosure.

Once your financial history is gathered and you have put together a detailed financial spreadsheet for the lender, your next order of business is to get the home up on the market. If you have not already done so, contact your listing agent and begin pulling comparables of surrounding home sales in your neighborhood from the past six months. This, just behind the collection of your financial data, is another critical step in selling your home. Many agents who list homes concentrate on listing your home for as much as they possibly can to not only pay off your lien, but to put extra dollars in your pocket. In the short sale scenario, all liens on the property are taken out of the equation. What the bank wants to know is the current market condition of your home. The seasoned listing agent who pulls comps should concentrate on the lower end of the market. This will solve two problems in this tight market: (1) it will bring you a ton of showings and potential offers; and (2) it will show the lender that you have a viable property that can be sold without sending the home to foreclosure.

Of course with a home priced at the bottom end of the market, you will get a lot of investors and individuals who want to place low bids on the property. This is okay. Take ALL offers and submit them to the bank. Before the offer is submitted to the bank, you must accompany it with a HUD-1 settlement statement. This is a universal tool all title companies around the nation use to disclose to both parties, the buyer and seller (and in this case your lender), as to who will pay for what and what the net profits will be at the end of transaction. Contact your local title office and have a title officer prepare this settlement statement. Instruct them to treat the sale of the home as if there are no liens on the property. Once the settlement statement is prepared, submit the signed offer from both the buyer and seller, accompanied with a prequalification letter or proof of funds AND your full financial package to the lender.

An important item to relay to the buyer is that they need to understand that the short sale process is not a fast transaction, it is usually a marathon. If you haven’t already been getting the phone calls from the lenders collection department, you soon will. Keep in mind that the loss mitigation department whom you are dealing with is completely separate from the collection department. The right hand doesn’t necessarily know what the left hand is doing. When you do get a collection call, indicate to them that you are requesting a short sale from the lender and that you have been working with loss mitigation. This may slow the calls, but it certainly won’t stop them.

The next step to the process is another very important step. Now that the lender has received your full file, they will order a Brokers Price Opinion (BPO) on your property. This is done by an independent third party, usually a local agent, who will drive by the property and pull various comps in the neighborhood as a way of indicating to the bank if the offer you are getting on your property falls within what they call “fair market value”. The reason why this step of the process is so critical is that that particular agent or appraiser can float or sink your transaction. If he decides to pull from the top of the market and you have pulled from the bottom of the market, there may be too much variance in the asking price to make the deal go through. This is why I like to meet them at the property to discuss the comps that they are using. This is also why you want to hire the “squeaky wheel” agent because they are the individuals who will meet the appraiser or agent at the property to push for a price reduction based solely off of the comps they pull in the neighborhood.

After the bank has received the BPO from the agent or appraiser, the lender will now put your entire portfolio, along with the third party appraisal into a package, and submit it to the investor for review, and hopefully approval. The investor is the individual who has actually loaned the bank the money for their loan to you. They are the only individual in this case who can approve, deny, or counter the offer on your property.

In my third and final discussion in this series, I will discuss the final phase to the short sale: the closing of the transaction and the long term ramifications of the shot sale process.

22December

PAPERLESS REAL ESTATE … Are we there yet?

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Real Estate experts hailed the advent of paperless offices more than 20 years ago when computers went mainstream. Although a majority of large companies and real estate firms were eager to adopt the concept, it’s only been within the past few years that the philosophy has truly started to catch on. The latest studies show that nearly 90 percent of all large corporations still operate with a high use of paper. A typical paper driven Real Estate transaction is copied more than 12 times prior to the actual closing of the transaction. That’s a lot of trees!

Bidselect.com, a real estate bidding system, ushered in the end of the long-lived dominance of paper in the Real Estate industry. With this pioneering Real Estate technology, it can safely be anticipated that many industry leaders will operate in a paperless fashion. Bidselect.com takes the guesswork out of buying and selling properties for both Buyers and Sellers. No more waiting days to meet with buyers or sellers, to spend hours reviewing stacks of paper just to get to the “bottom line“. Now, with a click of the mouse, the process can be done without paper over the internet. Offer submission, seller review and even offer negotiation – all done fast, electronically, efficiently and without paper! Buyers, sellers, brokers and agents benefit from this entirely online process. With Bidselect.com, Buyers and Sellers get exactly what they want and go green at the same time.

Bidselect.com – the future of Real Estate. Today!

15December

Changing Lives — One Swing at a Time!

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The Flower Mound Lady Jaguars swing bats daily in preparation for the 2008-09 softball season, but the Jags recently found themselves swinging hammers — and changing lives, helping Habitat for Humanity build houses for homeless and low-income families. The team partnered with First Preston Management for this welcome opportunity to make a difference with hammer-swings.

The Lady Jags and First Preston staff built walls at the Dallas Habitat Warehouse, experiencing first-hand some unexpected benefits of Habitat for Humanity. The Lady Jags Softball volunteers were thrilled to learn tasks they never thought they could do and see a final product that they literally had a hand in creating. Upon arriving for the work day, the site supervisor was a “little tenuous” about working with a group of “softball players”. By the end of the day, though, he admitted with a Cheshire-cat smile that he was “nothing short of overwhelmed and amazed at the work ethic the team brought to the build.” The Lady Jags had hoped to build 200 walls during the day, but far exceeded their goal by building 215 walls and units! After a long day of hardwood work, each Lady Jag volunteer left smiling, knowing her work made a tangible, long-lasting difference for a family in need.

While Habitat for Humanity has built more than 200,000 houses for homeless and low-income families worldwide since 1976, there are still thousands who would love the chance to become homeowners! The Lady Jags know Habitat for Humanity cannot do it alone, and they now understand that they are building much more than just houses. Only as a team can we turn a few walls into homes, hope, relationships, stronger communities and nurturing families.