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Helping Your Members Save Their Homes From Foreclosure

Speaker:

Save Our Home From Foreclosure, LLC


Loss Mitigation Specialists
140 Island Way #246, Clearwater Beach, Florida 33767 Phone: (727)449-9274 Toll Free: (800)305-7121 Fax: (727)449-9273 Toll Free Fax: (877)727-3671

John Rigg, CEO

email: John@SOHFF.Com

www.SaveOurHomeFromForeclosure.com

June 19, 2009

Agenda
Why Should I Care? What is the Definition of Pre-Foreclosure? How Does the Process Work? How To Help Members Avoid Foreclosure?

www.SaveOurHomeFromForeclosure.com

June 19, 2009

Why Should I Care ?


The unemployment rate rose to 9.4%, a 26-year high, from 8.9% in April 09. (www.cnnmoney.com) Combined net income of credit unions nationwide plunged 47% to $2.4 billion in 2008. (SP Times) Florida is 2nd in Foreclosures (RealtyTrac) Foreclosure brings stress, shame and insomnia to members and their families (Orlando Sentinel) Lenders from May to October 2008 lost an average 37% through short sales versus 56% on homes sold after foreclosure. (Clayton Holdings Inc.)
Short Sale: Well maintained home Foreclosure: Stripped home, water damage, etc.

www.SaveOurHomeFromForeclosure.com

June 19, 2009

Legal Defenses to Foreclosure Soar Delaying/Reducing Lender Recoveries


Google: Results 1 - 10 of about 597,000 for legal defenses to foreclosure. (0.21 seconds)
Foreclosure Defense KELattorneys.com Fight Foreclosure with Florida's #1 Law Firm for Foreclosure Defense. Foreclosure Defense Lawyer www.MyForeclosureLawyer.com Fight Foreclosure. Save Your Home. Low Monthly Fee. Free Consultation. Foreclosure Defense www.TotalBankruptcy.com Bankruptcy Attorneys. Free Review. Bankruptcy Filing. Bankruptcy Laws. Search Results 23 Legal Defenses to Foreclosure. Learn how to beat the bank at ... 23 Legal Defenses to Foreclosure. Learn how to beat the bank at foreclosure and win damages, triple damages, punitive damages, costs of your lawsuit, ... www.foreclosure-fight.com/ - Cached - Similar pages Legal Defenses to Foreclosure Sep 13, 2008 ... The author of 23 Legal Defenses to Foreclosure has identified over 50 legal defenses to foreclosure (23 with detailed explanations), ... ezinearticles.com/?Legal-Defenses-to-Foreclosure&id=1494311 - Cached - Similar pages Legal Defenses to Foreclosure Sep 13, 2008 ... The following are legal defenses to foreclosure that homeowners may use to beat the bank. www.articlesbase.com/national,-state,-local-articles/legal-defenses-to-foreclosure-561043.html - Cached - Similar pages Amazon.com: 23 Legal Defenses to Foreclosure: How to Beat the Bank ... Amazon.com: 23 Legal Defenses to Foreclosure: How to Beat the Bank: Troy Doucet: Books. www.amazon.com/23-Legal-Defenses-Foreclosure-Beat/dp/1438278195 - Cached - Similar pages Foreclosure Help, Foreclosure Defense You may also be able to recover money damages. Legal Aid: You Can Stop Foreclosure and Put the Lender on the Defense. To recover on a promissory note, ... educationcenter2000.com/foreclosure_help%5B2%5D.html - Cached - Similar pages Legal defenses against foreclosure - Rapidshare Search Sponsored Links, legal defenses against foreclosure.full.rar legal defenses against foreclosure [FullVersion] [HIGHSPEED] legal defenses against ... rapidlibrary.com/index.php?q=legal+defenses+against+foreclosure - Cached - Similar pages

www.SaveOurHomeFromForeclosure.com

June 19, 2009

Foreclosed Properties Sell for Less


Short Sale: 1/2009 MLS #: 7360824
Address: 125 Windward Is Clearwater Beach, FL 33767

Sales Price: $675,000

SP/Sq Ft: $329.91

REO: 5/2009 MLS #: 7404713


Address: 813 Harbor Is Clearwater Beach, FL 33767

*Sales Price: $650,000 SP/Sq Ft: $255.60 * Sold for 23% Less than comparable short sale

www.SaveOurHomeFromForeclosure.com

June 19, 2009

Foreclosures Increase Lenders Losses


Before: Beautiful Home MLS #: 7350111. Address: 113 Carlyle Drive Palm Harbor, FL 34683-1806

Purchase: Total Mortgages: List Price: Foreclosure REO Sold:


*

$770,300 02/2005 $916,000 $995,000 8/2007


After: Deteriorated Condition

$643,900 08/2008

This home most likely would have sold for more as a short sale with the owner maintaining property.
www.SaveOurHomeFromForeclosure.com June 19, 2009

www.SaveOurHomeFromForeclosure.com

June 19, 2009

When a seller is in financial distress and a lender approves a sale even though the property will sell for a price less than what is owed the lender.

AKA: SHORT SALE


www.SaveOurHomeFromForeclosure.com June 19, 2009

Pre-foreclosure Might Be an Option When


A home is worth less than is owed A potential seller has a demonstrated financial hardship (definition later) The potential seller submits all required verification and documentation to their lender within timeframes Junior (HELOC) lenders are willing to accept little or nothing
www.SaveOurHomeFromForeclosure.com June 19, 2009

Embarrassment / Pride 2nd Mortgage Can not commit to timeline Get started too late
www.SaveOurHomeFromForeclosure.com June 19, 2009

Pre-foreclosure Might be an option when..


A home is worth less than is owed Seller has demonstrated financial hardship

Pre-foreclosure Might not be an option..


Seller has ability to pay/refinance Seller has filed for Bankruptcy protection Seller isnt willing to participate
www.SaveOurHomeFromForeclosure.com June 19, 2009

Quote of the Day! ASK FOR WHAT YOU WANT, and TAKE WHAT YOU CAN GET

www.SaveOurHomeFromForeclosure.com

June 19, 2009

www.SaveOurHomeFromForeclosure.com

June 19, 2009

2008 US Foreclosures -Top 10


Rate Rank -1 State Name U.S. Nevada Total Foreclosure Filings 3,157,806 123,989 Total Properties with Filings 2,330,483 77,693 %Change from 2007 81.24 125.74 %Change from 2006 224.80 529.50 %Housing Units (foreclosure rate) 1.84 7.29

2
3 4 5 6 7 8 9 10

Florida
Arizona California Colorado Michigan Ohio Georgia Illinois New Jersey

501,396
152,621 837,665 66,795 145,365 146,099 116,225 115,063 69,612

385,309
116,911 523,624 50,396 106,058 113,570 85,254 99,488 62,514

133.11
203.13 109.86 27.90 21.61 26.22 44.36 54.70 101.20

411.68
655.04 497.91 61.41 107.89 155.40 117.07 126.01 186.84

4.52
4.49 3.97 2.41 2.35 2.25 2.20 1.91 1.80 June 19, 2009

www.SaveOurHomeFromForeclosure.com

Borrowers Who Owe 30%+ More Likely to Walk


Monday, May 18, 2009 THE WALL STREET JOURNAL

21.9% of U.S. homeowners owe more than their homes are worth Q1-2009, up from 17.6% Q4-2008 and 14.3% Q3-2008 (Zillow.com). Falling prices make it more difficult for homeowners who get into trouble to refinance or sell their homes. Fewer qualify for President's plan to stabilize the housing market whereby homeowners with Fannie Mae and Freddie Mac loans can refinance only if the mortgage loan is a maximum of 105% of the home's value. Borrowers who owe 30% more than their homes are worth are far more likely to walk away than those who owe just 5% or 10% more and expect prices to rebound. More than one in 10 borrowers with a mortgage owed 110% or more of their home's value at the end of last year, according to First American CoreLogic.
www.SaveOurHomeFromForeclosure.com June 19, 2009

294,187 Foreclosure Homes / $169,777 Average Foreclosure Sales Price * RealtyTrac


APRIL 2009 Foreclosure Rate Heat Map

Florida Foreclosures

www.SaveOurHomeFromForeclosure.com

June 19, 2009

Top U.S. Metro Foreclosure Market Data 2008


Rate Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 .22 State CA NV CA CA AZ FL FL FL CA MI FL CA FL CA CA FL FL Metro Name STOCKTON LAS VEGAS/PARADISE RIVERSIDE/SAN BERNARDINO BAKERSFIELD PHOENIX/MESA FORT LAUDERDALE ORLANDO MIAMI SACRAMENTO DETROIT/LIVONIA/DEARBORN SARASOTA/BRADENTON/VENICE FRESNO TAMPA/ST PETERSBURG/CLEARWATER OAKLAND SAN DIEGO PALM BEACH JACKSONVILLE Total Properties with Filings 21,127 67,223 112,284 16,208 97,684 47,387 46,843 49,697 39,876 38,106 17,256 12,571 53,630 38,797 44,931 23,399 17,025 www.SaveOurHomeFromForeclosure.com %Housing Units (foreclosure rate) 9.46 8.89 8.02 6.17 6.02 5.95 5.48 5.21 5.20 4.52 4.50 4.20 4.14 4.09 3.99 3.71 2.99 %Change from 2007 99.16 121.31 117.02 115.42 220.77 127.81 195.84 96.46 67.74 -7.67 153.58 102.50 122.66 99.34 122.24 96.33 78.46 June 19, 2009

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June 19, 2009

Seller PFS Benefits


Credit rating can be preserved Less stressful than foreclosure Preserves other assets Fresh start (reduce expenses, pay bills, rebuild credit, save for new home)
www.SaveOurHomeFromForeclosure.com June 19, 2009

1. Honest

www.SaveOurHomeFromForeclosure.com

June 19, 2009

www.SaveOurHomeFromForeclosure.com

June 19, 2009

Listing agreement Disclosure Form Pre-Foreclosure Package


www.SaveOurHomeFromForeclosure.com June 19, 2009

1. Honest 2. Communicate with Workout Specialist

www.SaveOurHomeFromForeclosure.com

June 19, 2009

Seller
Seller Must have a workout in progress 1. Modification 2. Forbearance 3. Pre-foreclosure 4. Bankruptcy

www.SaveOurHomeFromForeclosure.com

June 19, 2009

1. Honest 2. Communicate with Workout Specialist

www.SaveOurHomeFromForeclosure.com

June 19, 2009

1. Honest 2. Communicate with Workout Specialist 3. Prepare The Pkg. 1. Hardship 2. Third Party form 3. Financial information

www.SaveOurHomeFromForeclosure.com

June 19, 2009

PFS Approval Process


Borrower to call loss mitigation and talk to a Workout Specialist.
Inform of intention and commitment to timeframes. Ask about current turnarounds.

Prepare and submit Borrower Approval Package

www.SaveOurHomeFromForeclosure.com

June 19, 2009

PFS Approval Process


Borrower/Seller Approval: Submit financial information (varies by lender) but includes:
Financial Statement Hardship explanation form and/or letter Most recent checking and savings account statements for all borrowers. Some lenders require 6 months. Proof of all sources of monthly household income, such as pay stubs for the last 30 days, or if self-employed, profit and loss statements for the last two quarters along with the most recent federal tax return. Leases and social security, pension, or disability statements are required if applicable. Any other documentation or information you feel may be relevant to the situation
www.SaveOurHomeFromForeclosure.com June 19, 2009

www.SaveOurHomeFromForeclosure.com

June 19, 2009

Property

www.SaveOurHomeFromForeclosure.com

June 19, 2009

1. Honest 2. Communicate with Workout Specialist 3. Prepare The Pkg. 1. Hardship 2. Third Party form 3. Financial information

1. Honest 2. Communicate with Workout Specialist 3. Prepare The Pkg. 1. Hardship 2. Third Party form 3. Financial information

www.SaveOurHomeFromForeclosure.com

June 19, 2009

www.SaveOurHomeFromForeclosure.com

June 19, 2009

PFS Potential Pitfalls


Tax implication to the seller (debt forgiveness can result in 1099 income consult tax professional) It can take up to 120-180 days to get approval from some lenders Meeting all lender timeframes is paramount Typically requires seller to continue to make mortgage payments (workouts and payment plans are possible)
www.SaveOurHomeFromForeclosure.com June 19, 2009

www.SaveOurHomeFromForeclosure.com

June 19, 2009

Listing Price Loan Amount Offer Commissions Closing Cost 2nd Mortgage Example Loan Amount Offer Commission 2nd Mortgage Closing Cost Net/Net

$_____________________ $_____________________ $_____________________ $_____________________ $_____________________ $_____________________

$210,000.00 $168,000.00 (20%) $ 10,080.00 $ 2,000.00 (5-10%) $ 8,920.00 $147,000.00 (30%)


June 19, 2009

www.SaveOurHomeFromForeclosure.com

PFS Approval Process


Property Approval: A signed and ratified listing agreement A sales contract signed by buyer & seller, subject to Lender Approval. An estimated settlement statement showing all proposed seller paid closing costs. Proof of Buyers financing (i.e. pre-approval letter, etc) Brokers Price Opinion (BPO) or (CMA)
Some lenders require up to three different BPOs.

Title report Junior lien holder release agreement


www.SaveOurHomeFromForeclosure.com June 19, 2009

How to Help Your Members Avoid Foreclosure


Education
Identify at risk members early Partner with an expert loss mitigation firm to assist Conduct seminars and private meetings with members

Modify loans for qualified members Short sale Assumption Deed-in-lieu of foreclosure

www.SaveOurHomeFromForeclosure.com

June 19, 2009

www.SaveOurHomeFromForeclosure.com

June 19, 2009

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