I’ve recently heard several people tell me they were just going to walk away from their mortgage. They said they were just going to move out, give the keys back and notify the mortgage company they can have the home back. Some claimed they were given professional advice telling them to move out and just walk away from the home. Claiming letting the bank have it back would be best and really wouldn’t hurt their credit as bad as a bankruptcy and it wasn’t the same as a foreclosure. It’s amazing how wrong these folks are!!

Walkaway trends started where many homeowners found themselves upside down on their loans, owing tens of thousands more than the current market value of their homes. If they did 100% financing or have very little invested in down payments, some owners reason, continuing to make payments, even if they can afford to, may be throwing good money after bad. These people better beware its going to hurt their credit maybe worse than a bankruptcy or default foreclosure would. Why, first of all walkaway’s will have IRS tax liability. Last year federal legised that allows homeowners who negotiate loan modifications or Short Sales with lenders and have portions of their principal debt eliminated to escape tax liability for the amount forgiven. Walkaway borrows, by contrast, have nothing forgiven, and the IRS may demand taxes on the mortgage balance they never paid. This can be a substantial sum of money. In many cases filing bankruptcy or short sales may be a better route. It may have a faster turnaround time for buying another home when you have things straightened out. I’m by no means giving legal advice; I’m just letting you know you need to discuss selling your home as a Short Sale first before you consider just giving the keys back or waiting on the bank to foreclose. It could save you in a number of ways.

I want to warn people that there are a lot of people out there that are taking advantage of people’s hardships. Web sites are now advertising “I can repair your credit” for $495. Some say they will show you how to hold creditors off and avoid the due process and collection all the other broke folks go through?? Another company is offering, “Send them $995 and they will send you instructions on how to live free for a year and not pay any mortgage payments”. There is nothing legit about these magical offers. They’re rip off’s!!

The best avenue for anyone behind on their mortgage payments is to try to work something out with the lender first. An experienced professional real estate agent can help you prepare you for what the lender will require. Then there are consumer counseling services and attorney’s that can advise you on what’s best for you in the short and long run. Your goal is to make things where your credit lines come back as quick as possible.

I recently read that when applying for a new mortgage after a foreclosure, mortgage underwriters tend to be more sympathetic down the road in regards to people that faced genuine financial hardships leading to the past foreclosure or bankruptcy. Walkway

When people ask me what’s hot in the housing market today I would have to say Green Building or Going Green as many say. In past blogs I’ve written we’re going to have to embrace natural resources to heat, cool, recycle water and light our homes. As many of the green home technologies and products advance, prices are starting to become more affordable and cost justifiable.

I believe you really need to research and consider all Green Products when building or remodeling a home today. The demand for green energy efficient homes will be very high in just a few years.

For those of you that don’t personally know me, I’m not a tree hugger. I believe that as long as a truck fueled by diesel picks up my recyclable products then takes them to a recycling facility powered by a coal power plant isn’t saving or helping the earth’s eco system at all. And.…. many or the products after recycled aren’t suitable or in demand for use in the manufacturing of new consumer or industrial products.

When consumers or special interest groups bring things like Green Building to the forefront of America’s attention there seems to be someone that presents a different twist to the message glorifying their product and how it’s Green. To my understanding Green building should incorporate proper land use management, total energy conservation, products that were environmentally safe to make and wildlife habitat protection or replacement. All the products used in building any new Green home shouldn’t damage the environment in their manufacturing process or have waste that cannot be properly disposed of or is toxic. Say….. like vinyl siding does. Bottom line for me to consider something a Green Product it cannot harm the environment in any way when it’s manufactured, recycled or disposed of. For now we’re still going to have the diesel trucks moving these entire Green Products around the US. But the good news is they’re making diesel engines run cleaner all the time.

I just read an article with a new twist for going Green. It seems some of the hard hit vacation properties claim one way to go Green is to buy into the new fractional ownership housing now being offered at many resort properties. Fractional ownership is not a timeshare. Fractional ownership is taking a number of people; let’s say 4 families and they split the cost on a 500K beach condo. It’s easy to understand this opens the market up to a lot of people wanting second homes in expensive resort areas. But to consider this going Green is a stretch to me. David H. Schwartz, a real estate broker in Mammoth Lakes, CA was quoted in Forbes by saying. I observed, “Vacation homeowners using their home no more than one week a month. This is considered wasteful and definitely not green”. He goes on to claim fractional ownership is Green in every way. Sorry, David but I don’t buy it. The only Green involved here is the amount of Green Cash you’ll need to bring to closing table. Don’t get me wrong, fractional ownership is great, I can see myself buying one. But to claim fractional ownership is within the Green Movement is nuttier than a Snickers Bar.

If you are smart, and do your homework, buying or building a Green Home will have it’s pay offs! Both in energy and eco savings!

I usually only write one blog a month but after writing my most recent blog about the Sub-Prime Interest lock the government is proposing I decided to research more areas surrounding Atlanta to see the ratio of foreclosures by counties.

I always hear conversations about the person that just bought a 600K home for 400K. Sounds great doesn’t it? In reality it very rarely happens! In most cases the person is quoting you the asking price vs. what he paid for it. Or the best one I hear is someone saying they got a 600K home form 400K, it needs 200K but they can get it done for 100K. There’s more to these stories than you’re ever told.

I’m contacted every week by someone looking for a deal on a foreclosure. It’s understandable that everybody wants a deal on a home, but so far it’s been pretty hard for me to find plenty of foreclosure deals. I can find foreclosures but they are not deals!

However, I did find one this month. The buyer purchased this home for 225K which was about 25% less than the average home sold in the last 2 years in that subdivision. The home needs about 13K to 16K in cosmetic improvements and stripped appliances. This client has long term plans to live in the house. Thus making this a deal compared to the current market and county which was Cobb. The transaction took over 45 days from binding agreement to close!!

After doing some research I discovered why I’m not seeing all these foreclosures the media keeps talking about. I mainly work within Cobb and North Fulton County’s and these numbers tell my why I’m not seeing all those great foreclosure deals!

Below is the foreclosure rate per households in the following counties.
Cobb County - 1 in 597
Fulton County - 1 in 122 (Majority South Fulton)
Gwinnett County – 1 in 311
Paulding County - 1 in 164
Douglas County 1 in 260
Forsyth County 1 in 553
Cherokee County 1 in 396
DeKalb County 1 – 252
Rockdale County 1 in 207
Fayette County 1 in 368

So if you’re looking for a deal you might want to start in the counties with the most foreclosures. I want to make people aware that you have to do your homework when buying a foreclosed property. It’s very tricky and I recommend you hire a seasoned real estate agent to help you negotiate with the bank. It’s takes lots of patience and time to get foreclosure homes under contract and to the closing table! Banks are simply overwhelmed by foreclosure volume in general. They don’t pay any attention to the dates you want to close, etc. Be prepared to wait on all responses from the bank every step of the way. If you do your due diligence you may end up with some instant equity. If you don’t, your deal today will be a deal for someone else tomorrow. My dad used to say “figures don’t lie, liers figure”!

Call me I would love to discuss real estate opportunities!

As many of you know I’ve been very optimistic as to how far home prices in Atlanta will fall and how long it will take for values to start moving up again. I still strongly feel there isn’t a bubble in Atlanta that’s just waiting to pop. Right now we’re going through a market correction. Atlanta’s population growth has us positioned for major housing needs in the very near future. But overall the US real estate market has had numerous issues and factors that’s compounding and causing some unexpected new problems that hurting the already troubled real estate industry. It’s not all because of the collapse of Sub Prime loans and that’s a fact. FHA will now finance homes up to 346K and has filled the Sub Prime void pretty well. Thursday the US government reported that new home sales hit their lowest point in seven years. Let me repeat…..seven years???

Builders are slashing new homes prices 7.5% on average in the US. With a bloated supply of new homes for sale it’s clear it’s a buyer’s market. The Atlanta Builders have clearly realized this and are making the price adjustments and concessions to try to stimulate sales. But the resale home market isn’t following this trend. Thus leaving the new home builders without many move up buyers.

I recently attended a Re/Max of Georgia Platinum Club meeting. The format was town hall, round table, questions and answers. During our time together a very successful agent made the statement “without listings your dead”. I replied “No sir, the fact is without good listings your dead”. Listings and good listings are two totally different animals.

I’ve been fortunate to have had a steady flow of business this year and I’m very thankful for people putting their trust in me. However, most of my commission checks this year have come more from buyers I represented, not sellers I’ve represented in 2007. I’ve always consistently had equal buyers to sellers in the past. But this year representing buyers has kept me alive. However, buyers are struggling to find good homes to purchase in the Marietta, Smyrna, Powder Springs, Acworth, Kennesaw, Roswell and Alpharetta areas. Over my 15 year career my average buyer looked at 17 homes before buying. If we looked at many more than 20 homes I would scheduled a meeting with the buyer to analyze what the problem was. Could it be that I’m not be listening to them? Or was it the fact their dream home didn’t exist within their limits??

Today my buyers are having too view 25 to 40 homes before finding the one they may consider buying. Nothing is knocking them over right now. Why can’t these buyers find homes? A huge percentage of the resale homes on the market have either pricing problems or neglected maintenance issues. Surprisingly most don’t have as much of a home pricing problem as they do with neglected maintenance issues. I don’t blame the sellers in regards to this situation. I fully blame Atlanta Real Estate agents for not telling the sellers the right price and the condition a home has to be in order to sell.

Regardless of what you’re selling, whether it’s a car, playground equipment, or a house, the consumer has to see the value. Something they feel good about. Something that will make them say “I’ll take it”!! Nobody pays full book value for a car with a dent in the fender and a busted tail light; nobody pays full retail for a swing set missing a sliding board. So how are you going to sell that house that needs paint and carpet?? You’re not!! If you cannot sell your home stand back and take a good look at the things you would do if you were going to stay in the home. Then do them!! Don’t wait!! Real estate agents need to be honest with their sellers and let them know buyers want move-in condition. Inside and out! We will all see a significant upturn in the market if the median priced home inventory looked better. If this price range home begins to move faster, then the dominions will start falling and higher priced homes will have buyers that sold the median priced homes. I believe one of the reasons the Atlanta real estate market has slowed is because the median priced home inventories aren’t in the best selling condition!!