call Kevin 954-471-8120

Short Sale vs. Foreclosure?

You make the call!

I get the question from people all
the time: short sale or foreclosure, which is the better option? My knee-jerk
reaction is always “Are you kidding? Short sale, of course!” This has been
mostly because I was always under the impression that a short sale, although
still a ding on your credit, was gentler on the score than a foreclosure.

But according to a recent blog post
by FICO Banking Analytics, there is no real difference in the affect a short
sale or a foreclosure has on your credit score. Both the impact in points and
the time to fully recover is about the same for both events.

This put me in a precarious
situation. All this time I had lauded the short sale as vastly superior to
foreclosure, largely because of its less adverse affects on credit. So I was
forced to do further research into which was the better option. In doing so I
learned about benefits of a short sale I wasn’t even aware of, and found that
the FICO blog was way off.

Each borrower’s credit situation is
different, and the way that a creditor reports a short sale to bureaus is
different. The reality is that hundreds of thousands of distressed homeowners
who have chosen a short sale have experienced a lesser impact on their credit
than those who have chosen foreclosure.

In a short sale, a distressed
homeowner may be able to obtain another mortgage sooner than someone who has a
foreclosure on his or her record. Also, more and more employers pull credit
before hiring a potential employee, and a foreclosure can keep you from getting
a job.  Some employers pull credit
reports on existing employees, and a foreclosure may not bode well in certain
industries.

These benefits stacked against the
negatives of foreclosure, including the embarrassment of public announcement
and literally being kicked out of your home, make, in my opinion, short sale
the reigning champion.

The most convincing reason is that I recently completed a short sale in which the seller never missed a mortgage payment. So actually no negative credit was ever reported and the seller was able to qualify for a new mortgage and purchase a house immediately after his short sale!

Numerous recent reports claim renting is on the rise, but John
Burns Real Estate Consulting believes demand in top markets is about to
“explode,” with some cities seeing a 25% growth over the next three years.

According to John Burns, there are about 3.4 million units of pent-up demand
for rental housing bolstered by young adults who either live at home or are
rooming with a friend to save money.

“We expect this demand to materialize over the next few years, with most of
the demand entering the apartment market because of the inability to qualify for
a home and uncertainty over their employment situation,” vice president Leslie
Deutch said in commentary Tuesday.

Still, 20-somethings won’t be the only driver of rental demand. Unemployment is still high, the consulting firm said, which
will motivate even older adults to consider renting as a “safer” option. Deutch
anticipates only a 2% growth in jobs by 2012.

Government policy will indirectly send housing traffic to the rental market,
Deutch said. For 19 years, the government aggressively promoted homeownership,
an effort which “is about to reverse itself,” according to Deutch. A previous
report from the firm weighed the impact of government policy on the housing
market (see graph below).

“We see 2011 as a very uncertain year for housing, primarily because the
powers that be in Washington DC continue to influence the dynamics of the
industry,” Lisa Marquis Jackson, author of the previous report and senior vice
president of John Burns, said.

Sequentially, rental rates will rise, occupancy rates will increase, and new
construction will start, Deutch said. She expects some coastal cities to witness
rental growth of 25% or more. Other major metropolitan areas could see up to
4.5% rental growth by 2015. But not for very long.

According to consensus, Deutch said common sense indicators point to
homeownership. For one, she said, rental rates must hit a cap.

“Several of our apartment clients feel that they are already near the limit
of what their tenants can afford,” Deutch said. “Renters are a clever, creative
bunch who won’t take huge rent increases easily.”

Other reasons Deutch said the apartment sector will eventually contract is
because of the long-term affordability of owning a home versus renting, and
because it’s “not smart to rent forever.”

“As rents start to grow, more renters will consider buying,” Deutch said.
“Most people realize that paying rent all your life is probably not a great
retirement decision unless you are a fantastic saver.”

Write to Christine Ricciardi.

 Wells Fargo, your FHA lending leader, announces a major breakthrough for their contribution to help agents sell more homes, enable more buyers to Purchase, more homeowners to sell, and help the housing market in the our area.

 EFFECTIVE SATURDAY JANUARY 15TH, 2011, WELLS FARGO WILL START ACCEPTING FHA PURCHASE LOANS WITH LOWER THAN

600 CREDIT SCORES.

 Loan score 500 – 579 allowed with maximum 90% LTV – no gift or down payment assistance

• Loan score 580 – 599 allowed with maximum 95% LTV – no gift or down payment assistance
• Loan score 600 and higher allowed with maximum 96.5% LTV – gift acceptable
• Loan score lower than 500 = not allowed

For all Credit Risk Classes:

• Seller contribution limited to 3%
• Gift funds may NOT be used for the required 5% or 10% down payment

Note: Borrower’s ability to accumulate funds for down payment must be evidenced by documentation in the loan file.  Down payment Assistance Programs (DAPs) may NOT be used for the required 5% or 10% down payment

 Wells Fargo providing another tool for your real estate toolbox – use this tool this weekend and Everyday for the rest of the year.

 KEEP IN MIND FHA LOANS CAN BE DONE UP TO $417,000.

We hope this information will help you win and close your next deal…

Knowledge is Power.

2 Story Penthouse – Beach Front Condo

Excellent Opportunity to purchase directly from the Bank. Priced under $199 per sqft – $599,000

Just outside the neighborhood of Bal Harbour lies the Spiaggia condo, located within the neighboring Surfside and boasting several services and amenities that can fool anyone into thinking it’s actually a resort and not just a gorgeous condo.  Anyone looking to remain near Miami Beach will definitely want to check out Spiaggia.
Certain needs could strike even at the oddest of hours so it’s always good to know that whether it’s four o’clock in the morning or four o’clock in the afternoon, the Spiagga condo has got you covered at all hours of the day.  Recreation and relaxation come aplenty at Spiaggia.  Visit the stunningly landscaped beach club, go to the restricted pool which comes with its own Mediterranean inspired landscaping or visit the club room and fitness center.
Multiple units at the Spiaggia condo come ready with a surround experience and also feature bamboo wood flooring, interactive panels for contacting concierge services, and easy to manage climate control systems.  Look for Italian inspired countertops in the bathrooms as well as kitchens also featuring a stunning Italy inspired design.
Whether you choose to head north, east, south or west, you’ll eventually come upon tons of things to see and do either in Bal Harbour to the north, popular Miami Beach to the south, the ocean right next door to the east, golf courses to the west and plenty more beyond.

Spiaggia Amenities
24 Hour Concierge desk with direct interactive multi-media communication within each residence
24 Hour On Site Valet Parking
Club room off of lobby with state of the art entertainment system and informal conference facility
Fitness Center with floor to ceiling glass vistas of pool deck
Heated Lap Pool with stone linear edge details
Lushly landscaped outdoor seating within a formal garden design lined with palm trees
Beach Club offering a mix of sandy and grassy patches with landscaping of a fragrant nature
Unique furniture that offers capabilities of sun intake or a more shaded experience
A magnificent lobby with soothing water feature
A Mediterranean style landscaped pool and sun deck
Private pool side lounge cabanas

Residence Features
Travertine stone floors
Surround sound ready-wired units
Spectacular balcony views
Interactive intercom control panel system with concierge
Climate controlled environments
Italian kitchen designs with elegant contemporary style
European crafted cabinetry with raised panels (cherry wood finish)
Italian marble countertops
Kitchen Aid sleek stainless steel appliances
Marble floor-sand countertops
Lavish Jacuzzi tubs
European-style fixtures and hardware for bathrooms
Glass seamless shower enclosures
Designer bath fixtures and faucets

For More Information Call Kevin Berman 954-471-8120

Unique  2 Story Beach Front Penthouse Condominium located in Spiaggia Ocean Beach Condo – Surfisde Florida. Adjacent to Bal Harbour. Walk to World Famous Bal Harbour Shoppes, Restaurants, Shopping, & Entertainment. Direct Access to Private Beaches, Ocean Views, High Ceilings, Travertine Floors, Marble Baths.

For More Information Call Kevin Berman 954-471-8120

$285,000

VERY MOTIVATED SELLER!! BEAUTIFUL 3/2 IN DAVIE WITH POOL, LARGE PATIO, AND PRIVACY FENCE. EXTENDED LIVING ROOM, ENTIRE HOUSE HAS BAMBOO WOODEN FLOORS. TWO CAR GARAGE. ACCORDION SHUTTERS ON ALL WINDOWS.! CLOSE TO SCHOOLS, SHOPS AND RESTAURANTS. FIVE MINUTES FROM NOVA UNIVERSITY. MUST SEE!!!!

• FORECLOSURE
• 3  BEDROOMS
• 2  BATHROOMS
• 1,874 SQUARE FEET
• WASHER/DRYER
• 2 CAR ATTACHED GARAGE

Large 2/2 condo in The Symphony luxuary condo downtown Ft. Lauderdale.  Very bright, great river and park views, stainless steel appliances, washer/dryer in the unit, and large walk in closets.  Communiy has a large pool, spa, gym, theater room, access to river taxi, gate gaurd, and more!  This is a must see!!  Lowest priced 2/2 downtown!

• FORECLOSURE
• 2 BEDROOMS
• 2 BATHS
• 1194 SQF
• HOA FEE’S $832/MONTH
• WASHER/DRYER IN UNIT