Assist2Sell

Yesterday the Federal Reserve left interest rates near zero and vowed to keep them there for a while to nurture an economic recovery held back by stubbornly high unemployment.  The policy statement reflected a somewhat brighter tone than it had at the previous meeting in December.  "Information received since the Federal Open Market Committee met in December suggests that economic activity has continued to strengthen and that the deterioration in the labor market is abating,'' the Fed said.  In the December statement, the Fed had said economic activity "has continued to pick up.''  The decision to hold rates steady was 9-1, with Kansas City Federal Reserve Bank President Thomas Hoenig dissenting because he wanted the central bank to eliminate a phrase vowing to keep rates exceptionally low for an extended period.  However, the Fed dropped a reference that had been included in December's statement which said the housing sector ''has shown some signs of improvement over recent
 months.  ''The Fed repeated its intention to allow purchasing of some $1.43 trillion in housing-linked debt to conclude as scheduled by the end of March, but added: "The Federal Reserve is prepared to modify these plans if necessary to support financial stability and economic growth.''

If you live in the Reno Sparks area and have had some contact with real estate sales, you have probably heard the term SHORT SALE.  So what does a short sale actually mean? The simple definition is your mortgage balance is greater than the current value of your home. For example, if you bought your home for $250,000 a few years back and got a mortgage for say $230,000.  For some reason you now have to sell your home. Unfortunately, if you sell your home today it will only sell for $150,000. This means the proceeds (selling price) will be “short” $80,000.

Here is an entry from wikipedia. A short sale is a sale of real estate in which the sale proceeds fall short of the balance owed on the property's loan.^[1] It often occurs when a borrower cannot pay the mortgage loan on their property, but the lender decides that selling the property at a moderate loss is better than pressing the current debtor. Both parties consent to the short sale process, because it allows them to avoid foreclosure, which involves hefty fees for the bank and poorer credit report outcomes for the borrower.                                                                                                               

So why would a bank be willing to take less than the home is worth? First of all, to even be considered for a short sale, you would have to have a signification “financial hardship.” Loss of a job, escalating mortgage payments, pay cuts, etc.. So the way the bank looks at it is if you are going to quit making payments on your home, we are going to have to foreclose on the house.  The foreclosure process is lengthy and costly for a mortgage company. In addition, after the foreclosure the house will sit vacant and may get vandalized, the lawn will dye, and a stigma will be attached the property. In the end the foreclosure cost more and the property will end selling for less, not to mention the negative impact on the neighborhood. This is a loose-loose scenario for the bank/mortgage company.

With a short sale, the costs are much less, the property remains occupied, maintenance is kept up, and the property will normally sell for a higher price. The bank/mortgage companies will still loose money, but on a short sale the loss will be reduced.

Short sales are usually much better for the homeowner as well. The impact on credit is much less, you are able to stay in the house until it sells, and the neighborhood is saved from foreclosure.

If you are experiencing a financial hardship and are having trouble making your payments, a short sale might be a good option. As always, you should seek guidance from real estate professionals, attorney, and your CPA before you make a decision.

I listen to my Ipod in my car on the way to work, when I travel, and even before bed. Ok, addict may be a bit over the top.

 It's not the Ipod devise itself (although it's hands down the best), it is the content you can get. You can download/listen to incredible information from just about any topic you can imagine. If you need to improve your sales skills, change your attitude, find out what the markets are doing, learn how to market your business on the internet, and more.

Some wise people once told me, your car should be your university. My Ipod has turned into my master program for advanced education. I figure an Ipod doctorate is not far behind. Best of all, I'm not drowning in student loans.   

We have all heard the sayings, "learners are earners" and "readers are leaders." And one of my favorite quotes.

"In times of change, the learners will inherit the earth, while the knowers will find themselves beautifully equipped to deal with a world that no longer exists."    

                                                                                                            Eric Hoffer

Learning, growing, and improving your skills has never been more important. So if you have an Ipod, stock it up with some great info.

Here are a few of my favorite Podcast.

Get Real Real Estate Inventing

Market Watch-Real estate Roundup

Internet Business Mastery - Business Development and Internet Marketing for Web 2.0

Sales Gravy-Power Principles

Harvard Business Idea Cast

Inspiring Words-Zig Ziglar

Manager Tools

If you are more of a visual learner, you can down load video podcasts.

The information will keep you very interested. When you read it, think about how your Assist-2-Sell office fits with the long tail.

A big thanks to Dave Crumby in Phoenix for recommending this book.

One thing I have learned over the years is business is all about relationships. As the saying goes, it isn't what you know but who you know that is important. People like to do business with people they know and can trust. In real estate we like to do business with Lenders, Title Officers, Inspectors, Appraisers, and other agents we know will do the job right.

We also need to establish long lasting relationships with our clients. Establish good connections with your clients and the business and referrals will pour in. The beautiful thing about Assist2Sell is you have more opportunities to serve more clients and establish more relationships.

This is a great book that will open your eyes to the connections all around you.