Sarasota homes for sale are sinking underwater at a rate greater than the reported 1 in 4 mortgages underwater. What this means to homeowners is that IF/WHEN they must sell, they’d better have a “boatload” of money available or….
Who else wants to live on Foreclosure Street? image source: http://www.real-estate-foreclosure-deals.com/Properties/Albuquerque/Albuquerque_Foreclosures.htm
Bob & Louise of Sarasota (FL) owe $569,000 on a home worth $345,000.
By definition, they are “underwater.”
The problem….
It’s worse, as Bob is losing his job with a modest severance. Bob’s line of work has all but disappeared in and around Sarasota. For months, he’s read the writing on the wall.
Should their property short sell at today’s value, Bob and Louise can NOT show up to the closing table with $234,000 + closing costs. No way can they afford it, now or ever.
Click Read More below now for Bob and Louise’s difficult situation caused by forces outside their control. If you think Bob and Louise are just another couple who got themselves into this mess, you should click away right now.
AVOID FORECLOSURE “SOLUTIONS”
They have one mortgage that’s up-to-date…with a letter confirming Bob is losing his job shortly. Bob and Louise have no savings, no IRA’s or 401k’s or jewelry or assets.
Note: They don’t even have “high” credit limits on credit cards. Do you hear this, NCO Financial (the most “cocky” debt collectors I’ve had to face).
They have nothing for a bank to see as grounds for denying a short sale or granting lien release only. Fortunately, their debt owner is NOT Virtual Bank of Palm Beach, FL; Wachovia; Bank of America (formerly Countrywide); or SunTrust.
Note: All 4 mortgage debt owners are the absolute WORST to work with. All 4 gladly will LOSE even more money for their investors. I can get specific if you request below when you leave a comment.
As it is, Bob and Louise should be candidates for short sale, though they also realize they qualify for Chapter 13 bankruptcy. I attended a consultation with them, as the BK attorney walked through their income/expenses/assets and asserted if the BK went as planned, they’d walk away (in a worst case scenario) owing $130.00 /month for 5 years.
The opinions vary across the board….
Bob & Louise do NOT want to file BK. As unpredictable as short sales are, their debt owner might FORCE them to file bankruptcy. Depending on to whom you talk about avoiding foreclosure, you will get many different perspectives:
- Bankruptcy attorneys typically believe every situation calls for bankruptcy.
- Some realtors claim no short sale is successful — usually those realtors don’t know much about short sales and if they do they outsource all aspects of negotiating, relying on others to determine whether a homeowner sinks or swims. What’s interesting here is that the “short sale negotiating ” companies many realtors rely on to negotiate do the same to their negotiators as the banks do to their negotiators: load them with 150+ files! Talk about ineffective….
- Real estate attorneys once specializing in real estate closings now (due to no closings) have become “foreclosure defense” attorneys. Most law firms (with which I’m familiar) promoting themselves as “foreclosure defense” law firms do NOTHING but push paper. About 18 months ago, I thought I had found a good law firm in Orlando. Homeowners I referred actually got helped. Then, this law firm did what most have done: they ramped up their marketing to retain more clients, turning nearly all communication over to untrained (and unknowing) assistants, paralegals & support staff. My customers kept complaining to me they never could find out what’s going on with their home. Oh, it gets worse. I’ll save this topic for a different discussion.
- In some states and instances, a foreclosure might be the BETTER solution. It depends. I recommend a homeowner fearing foreclosure talk with a real estate attorney and accountant. At least, hear what they have to say.
For now, Bob & Louise are doing nothing, which is quite common. They’re still in shock and don’t want to face reality. I understand. There is no winning in this situation. There’s only LESS pain and suffering. However, Bob and Louise will have to take action at which time I’ll step in to help them carry out their decision, whatever it is.
It appears in their case (after they’ve talked with their attorney and accountant) a short sale will be best for them…once they see it that way.
Few people EVER have had to go through this nightmare. Bob has made a very respectable income his entire life. He walked with some of Sarasota’s finest. And then the bottom fell out of (most of) Sarasota’s economy, which strongly relies on service. The chain reaction (if you will) has claimed and is claiming many more victims.
Please scroll down and leave a comment. What’s your experience with foreclosure? Perhaps you’re immune to foreclosure or job loss. Perhaps you feel homeowners are to blame, that they got in “over their heads.” I hear this all the time. In a few cases, that’s true. In most cases, it’s far from the truth.
Sarasota homes for sale…actually Sarasota home OWNERS…must make tough decisions now and in the coming months. Few homeowners can show up to a closing with $234,000 + closing costs. Share your thoughts below. Call or email me now if you or someone you know wants to discuss options for (trying to) avoid foreclosure.
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