In my travels through the blogosphere, I came across a very interesting post about how one woman was able to put a halt to the foreclosure proceeding against her. It has beauty and elegance in its simplicity.

I, personally, advocate doing anything you can to stay current with your mortgage payments. I think that keeping your payments up is probably the easiest way to keep your house and keep your credit intact. Foreclosure should never be the first option. However, when push come to shove, this post on Sellsius, entitled How to Stop Your Foreclosure: Ask for the Note, is interesting reading.

Consult an attorney before you try this route.

In this video by Jonathan Jarvis, entitled The Crisis of Credit, Visualized, there is a clear, consice and easy to understand primer of how we got to where we are today.  It’s a little over eleven minutes long.  It’s well worth the time!

The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo.

Depending on who you listen to or what Internet site you surf it was either 3° or 7° when I went outside to pick up The Washington Post from the end of my driveway.  Even though there was no wind,  it was c-o-l-d.  I could feel the air going through my nose and making it feel kind of funny.

How Cold Affects Showing Homes

In a general way, showing homes in the cold is no different from showing homes in any type of weather.  If the home is still occupied by the owner and they agree to have their house shown, you and your Realtor just toodle on over and view it.  If it’s a vacant home, your Realtor logs in the appointment with the listing agent or showing service and you go on over.

Still, it means that you really need to bundle up and be prepared for the cold.  Many homes that have been vacant for awhile are very cold inside since the heat has been shut off or turned way down for an extended period.  Hopefully the owners or the banks, in the case of foreclosed homes, have “winterized” the homes so that water pipes don’t freeze and burst creating flooding that will lead to mold and worse.

It’s also important to think of the “other guy”.  The other guy could be your Realtor or, if you’re the Realtor, the other guy could be your client.  Don’t leave each other “out in the cold” with the car running or standing around outside waiting.  As inconsiderate as this is during nice weather, it’s really bad news during the times when temps are in the teens or below.

More on Vacant Homes

In this market there are lots of homes that are in “short sale” status.

This means that the current owner/Seller still owns the house and is responsible for the upkeep and maintenance of the property. The problem is, many times, the owner/Seller has walked away from the house.  That’s right.  They have actually moved out of the house and, quite possibly, mailed the key to the bank.  In this case, the houses might not only be cold (they most certainly will be) but they’ll be dark after the sun goes down since the owner/Seller has probably stopped paying the electricity bill, too.

My guess is that if you’re looking at homes in this weather than you are a serious buyer who really wants to buy a home.  If you’re selling your home during these winter months it means you really want to sell your home. The important thing to remember is to:

• bundle up,
• come prepared with a flashlight and
• your notepad.

If you’re interested in seeing a home - in any weather - just shoot me an e-mail or give me a call at 240-417-9100.

As reports go, this one, from the Maryland Department of Housing and Community Development, is pretty timely.  The report is from a quarter that ended a few months ago but, of course, it takes time to collect all the data and compile it into a report that can be distributed.

It shows a pretty bleak picture for the two Counties in the MD Suburbs of DC that I serve (Montgomery County and Prince George’s County).  However, it also shows a little bit of a downward trend.  I’m not sure how much of this is because banks have slowed down on their foreclosure activity because of new State law, the Christmas season, winter or whatever.

Here is the report, entitled: Property Foreclosures in Maryland - Third Quarter 2008

Complete with maps, tables, graphs and everything!

As we have all heard more times than we can stand, the housing market is in a slump with foreclosures and short sales in plentiful supply.  The problem with this is that it floods the market with an excess number of homes that a limited number of buyers can qualify to buy. Combine this scenario with a very difficult mortgage environment where only the “A” type home buyer - good credit, low debt-to-income ratio, good income - can qualify for a mortgage and you have a double whammy.

Let’s pretend you qualify for a mortgage.  There are three types of home sales out there:

1. Foreclosures - the bank actually owns this property and someone at the bank can actually make a decision about whether or not to sell it to you based on the financial terms of the offer.
2. Short Sales - the bank doesn’t legally own the property and the Seller cannot sell the home for as much as he owes on the mortgage.  The Seller is “short”.  Sometimes the Seller is very short.  In all cases, the bank must approve the sale since they are agreeing to take a hit on the mortgage.  This is most often referred to as “Third Party Approval Required” in the listing description on real estate web sites.
3. Conventional or “Plain Vanilla” - this is the type of sale most people are think about when they think about buying or selling a home.

Why Plain Vanilla Is Best

Sure, you might be able to get some “good deals” with either the Bank Owned properties or the Short Sales but wither of those two scenarios you are buying the home in total “as is” condition without any repairs to be made by the Seller (in the case of a short sale) or the bank (in the case of a foreclosure).  You also have to have the patience of Job if you want to buy a short sale. Banks typically take from four to six months to work through the process of approving your offer and there is no guarantee they will approve it.

The conventional, “normal” or “plain vanilla” type sale is a whole different experience. Here’s why:

1. Most often the Seller will have equity in their home.  Thus, they have room to negotiate financial terms including concessions to pay Buyer closing costs.
2. They are most often willing to make repairs based on a home inspection depending on the scope and cost of the repairs.
3. They can make decisions quickly so you will know what the Seller is or is not willing to do within a short period of time.
4. Settlement can happen quickly. Depending on individual circumstances on both the Buyer side and Seller side the entire process can take as little as 30 days from the date an offer is accepted to the date everyone is sitting at the settlement table.

When A Deal Is Not A Deal

Sure. Some of the foreclosed properties really are “deals”. Most of them are not.  If you figure in the cost of repairs, the time spent dealing with the bank it make not be a nice as you would think.  Short sales are even worse because the time frame is much longer, there are the repair issues and, possibly, title issues with liens and such. Still, if you have patience and perseverance this might be a good way to go.

Just don’t get too crazy after watching a lot of midnight infomercials.  Sometimes “plain vanilla” can be just as sweet.

Today I went out with a Buyer client looking for condos near the University of MD. The criteria was pretty simple: cheap.  That meant lots of bank-owned condos and lots of short sales.

I’m hear to tell you it’s been a long time since I went out and looked at so many distressed properties. Some were in pretty good shape, one had the entire kitchen gutted - no appliances whatsoever or counters or cabinets…nothing but an empty room - one had  a bathroom with the ceiling in partial collapse. Most had filthy and/or torn carpet and were badly in need of a paint job.

All of them were being sold “as is”. No repairs. No concessions.  What you see is what you get.

It’s kind of sad, really. Both for the people who used to live in the condos (or are on the way out) and for whoever ends up buying them.