Florida Foreclosures- How Long Does My Lender Have To File Deficiency Judgement?
Statute of Limitations for Post Foreclosure Deficiency Judgements
In the state of Florida AFTER your home or property has been foreclosed on, your lender or the mortgage note owner has a specific time period in which they can file a judgement against you.
What happens when you lose your property in a foreclosure is that your property will be sold and most often it will be sold for less than what you owe your lender.
When there is not enough money to pay off the balance of your mortgage- that is called a “deficiency”.
The creditor ( your bank- note owner- servicer in behalf of your note owner- etc) has a right in the state of Florida to file a claim against you for that deficiency amount.
So if you owe the bank $500,000 on your loan for your property but the foreclosure sale goes for $400,000; you owe your lender $100,000. Your lender has the right to get a judgement against you for that amount.
BUT there is a statute of limitations in Florida for how long they have to make this claim against you.
The rules have also recently changes with the new updates to foreclosure rules in Florida.
The rules used to say that the bank has 5 years to file a deficiency judgement against you.
With the new rules- the creditor in a foreclosure only has 1 year to make a claim against you.
If your foreclosure took place on or after July 1, 2013 the creditor has to file their deficiency judgement against you within 1 year.
If your foreclosure happened before July 1, 2013 then your creditor has 5 years to file that deficiency judgement against you or prior to July 1, 2014: whichever comes first.
If your lender has violated these new rules we suggest you seek the advice of a good attorney.
We are NOT attorneys and we are NOT giving you legal advice. Please contact your attorney for specific legal advice pertaining to your own situation.
If you want to avoid your foreclosure- a Florida Short Sale may be a better option for you. Call Nestor Gasset or Katerina Gasset right away at 561-753-0135 for a confidential phone interview about your situation.
Don’t Lie About Your HOA Fees- Your Agent, Bank and Title Company Will Find Out
When you are selling your home in Florida as a short sale you still have to pass clear title to your new buyer.
The title company is going to do a search for any defects on your title such as liens from your HOA ( Homeowners Association) or Condo Association.
The title company also has to order an “estoppel letter” from your HOA. This is a document that contains the verified information from your HOA about what you owe and whether you are current or not. It will contain the amount of money that is going to have to paid to the HOA before they will issue a clearance.
When you list your property with a Wellington short sale agent come clean with us on what you owe and to whom you owe it to. If you say that you are current on all of your HOA fees we are passing that information along to the title company who is then going to need to verify if this is true. So why lie? It won’t help you- in fact, in many instances it can come back to hurt you.
In the state of Florida your mortgage servicers are only required to pay up to a certain amount of your delinquent HOA fees. So that leaves the rest on who?
Telling the buyers at the last minute that they are going to have to pay your HOA fees is a great way to kill your short sale.
You are the one that is responsible for your HOA fees. Make sure that you are at least being honest in what you owe and for how long you have not been making your HOA fees.
Remember also, that in the state of Florida, the HOA can foreclose on your house WAY before the bank does!
Contact Nestor Gasset and Katerina Gasset at 561-753-0135 for a confidential phone interview about your option to do a Florida short sale.
Home Equity Line RESETS Are Coming Due!!! Homeowners with HELOCS may get a BIG surprise in the coming months as their loan payment skyrocket when the payments reset.
The Housing bubble and bust- we are not out of the woods yet. Residual effects are still in the making.
Home Equity Lines of Credit- HELOCS are when you take a loan out for things like college, vacations, buying another property, remodeling, etc.
During the boom years these HELOCS were very popular because the prices of the houses kept going up.
The states of Florida, California, Nevada and Arizona had the BIGGEST surges in home prices.
These are also the same states that saw the biggest number of defaults, foreclosures and short sales.
The HELOCS were offered with payments of interest only for 10 years. Guess what, 10 years is coming up and for those who took out HELOCS in 2004 are already getting their new payments and surprise, surprise, they are MUCH higher than the interest only payments were.
For instance, if you took out a HELOC on your house of $100,000 at 3.5% interest rate your payment is $292 per month but once it resets it will jump to a whopping $715!!!!
Are you ready for your new payments?
I must say, I am SOOO happy we did not get one of those HELOCS as tempting as it was.
There is an estimated 817,000 people this year alone who will be faced paying the piper to the tune of $23 BILLION in HELOCS– this is more than double of what it was last year.
Then during the next 5 years another $50 BILLION in HELOCS will be reset.
All of this is going to contribute to a more sluggish U.S. economic recovery because that $500 per month is not going to be going to buy new cars, spend on vacations, etc. It is going to be used to pay back these HELOCS from things you already spent the money on. This is money not going into the economy in goods and services. This money is being sucked out of consumer spending and that sound is not attractive to say the least.
Most people who have HELOCS can not refinance because they don’t qualify or they were behind on their upside mortgages and the like.
Another problem that all this creates it that the banks know that most of these kinds of HELOCS are uncollectable as there is not enough equity to foreclose on the second to any benefit to the HELOC bank since the first note holder needs to get paid first.
The other issue is that the banks will tighten up extending mortgage loans to all but the most credit worthy buyers because of the losses they will have to suck up due to people who won’t be able to make that reset payment.
Some banks are being proactive and reaching out to their customers two years before the resets come due to warn the borrowers as well as trying to work with them on getting these HELOCS paid off or refinanced.
Look at your paperwork from when you took out your HELOC. Make sure you know your interest rate and when your payments are going to reset. Then make sure you plan to meet those payments or call us to see if there is enough equity in your house. If you have enough equity in your house, we may be able to list your house for sale and you can move on.
Contact Broker Nestor Gasset at 561-541-9936 to discuss your options confidentially now.
If you are planning on buying a Florida short sale, take note of these new loan requirements for getting a mortgage. With the start of the new year, lenders have set in place new requirements for getting a mortgage loan.
Since the housing crisis was brought about by borrowing catastrophes, these new lender guidelines being implemented under The Consumer Financial Protection Bureau’s Qualified Mortgage (QM) are being put in place to avoid the housing meltdown from happening again.
Some of these requirements are as follows:
A maximum debt-to-income ratio of 43. This new rule will not allow for any circumstances to offset the DT like a big down payment or huge cash reserves. A borrower with a DTI over 43% will not qualify for a loan.
Ability to repay. Self-employed borrowers must prove they have sufficient cash flow to pay their loan. This can be challenging since most self-employed people’s income tend to fluctuate. These borrowers usually have cash reserves set aside to compensate for months where their income is low. Even with a huge cash reserve, self-employed individuals may still have a difficult time in getting a loan approved.
No-doc or low-doc loans not allowed. Lenders are required to submit and verify borrowers’ complete financial information
Lower fees. Origination fees should not go beyond 3% for a loan of more than $100,000.
No risky loans. No interest-only payments, no negative amortization payments where principal increases, and terms should not exceed 30 years.
Contact within 36 days of missed payments. Lenders should contact borrowers within 36 days of a missed payment. Lenders must also provide available payment options not later than 45 days after the due date.
Clearer monthly billing statements. Lenders must provide clear monthly statements indicating the amount of your payment that went to escrow and principal, balance owed, and service or transactional fees.
Early warning for ARM: Lenders must notify borrowers of increased rates 210-240 days before the next payment and follow up with an additional notice 60-120 days before the new payment is due.
The lender’s incentives in following these guidelines are huge. If mortgage loans fail to meet the QM, the lender can hold the loan instead of selling it to Fannie Mae or Freddie Mac.
The QM requirements may have lower loan limits for conventional conforming loans. The Federal Housing Finance Agency (which regulated Fannie Mae and Freddie Mac) will delay its normal adjustment of loan limits from 1 January 2013 to sometime later this year, after seeing what kind of impact the new QM guidelines will have on the housing industry. The current limits for most housing markets are $417,000 or as much as $625,000 in high-cost areas. These figures will change later this year.
Getting a smaller loan will be more difficult under the new QM requirements since origination fees will be limited to no more than 3% of the loan amount. This means lenders are less likely to offer smaller loans since they may not be able to recover their costs and make a profit with the smaller origination fees.
Florida short sale home buyers could expect to see these changes in the mortgage loan approval process this year and more changes later in the year.
Wellington Foreclosures | REO | Bank Owned | Market Report
If you are looking for a foreclosed property to buy in Wellington Florida you will be hard pressed to find one. There are very few bank owned properties for sale in Wellington.
REO is a real estate term that means, Real Estate Owned. This term is used by banks with regards to the assets they own, the properties they have taken title to through the act of foreclosure.
Currently there are only 4 properties listed for sale in Wellington as bank owned properties REOs.
12305 Equine Lane is listed at $510,000. This home has 5 bedrooms and 4 bathrooms with 6,287 square feet.
15721 Athens Ter is listed at $333,382. This home has 5 bedrooms and 3 bathrooms with 4324 square feet.
12632 Buckland St is listed at $239,000. This home has 3 bedrooms and 2 bathrooms with 2586 square feet.
and a multi-family zoned lot is listed for sale at $41,000.
Contact Nestor Gasset and Katerina Gasset at 561-753-0135 to get started on your home search.
Wellington Short Sale Market Report- October 2012
Currently there are 41 short sales for sale in Wellington.
The highest priced short sale is a single family home with a 6 stall barn listed at $1,649,000 with 3258 approx. living square feet under air. This home is in a gated equestrian community.
The lowest priced single family home short sale in Wellington is currently listed at $ 158,773 with 1641 square feet and this home backs up the preserve.
Most of the homes for sale in Wellington as short sales are priced in the high $200,000’s to the mid $300,000’s.
There are not many short sales for sale in Wellington and that has been the case for almost a year now. We are anticipating more short sales to come on the market in 2013 as the layoffs and unemployed numbers rise. We will also start to see some short sales coming on the market because of time is coming up for many homeowners who have not made their mortgage payments for a long time. The banks are starting to foreclose again and the courts are processing foreclosure judgments.
If you are looking at options to foreclosure, a short sale may be your best option. It is most often a better option for you than to leave your keys on the table and just leave when the sheriff arrives at your day with a notice to vacate. Many times homeowners qualify for cash incentives to do a short sale by their lenders.
Call Nestor Gasset and Katerina Gasset today at 561-753-0135 to go over your foreclosure options. This call is confidential. Don’t lose your home to foreclosure. Call us today.
Do I Have to Put a Deposit in With my Offer to Buy a Property?
There is no law that says you have to put deposit money down with your offer to purchase a property. But there is a law in Florida called the Statutes of Fraud. Part of that law says that in order to enforce a contract there has to be some time of consideration. That can be in the form of cash, check, money order or bank check. It could also be gold, silver or whatever else of value.
Now, with saying all that…. you know the answer to so many questions, it all depends:)
Why are you buying a home? The reasons you are buying a home should become part of your reasoning as to what type of deposit to attach to your offer.
If you fall in love with your dream home it is highly likely other buyers may also be of the same opinion as you. That creates competition. Here in Wellington many listings get multiple offers. The stronger you make your offer, the better your chances are that the seller will accept your offer and not someone else’s.
Many buyers don’t learn this lesson until after they have lost the chance at buying a home they fell in love with.
The bigger deposit you put with your offer, the more serious you appear to be in going through with the sale of the property.
A seller has to take their home off of the active market once they accept an offer. So they are looking at what is going to be the offer that is most likely going to close. The highest and best offer and terms is usually the one a seller will accept.
The seller has to take his/her house off the market they in turn want you, the buyer, to not be actively searching for another home. Some buyers want to place offers on multiple properties.
Many buyers’s agents don’t want to have the buyer’s money at risk. What if you decide you don’t want the property next week?
There are contingencies you can add to your offer, such as your offer is subject to you accepting the home inspection report on the property. If you don’t like the inspection report you can cancel your contract. If you cancel your contract within the terms of the contract, you get your deposit money back within the time specified.
If you don’t show the seller you are a serious buyer the seller will likely accept another offer.
No matter what the opinion of anyone else is, you must always ask yourself, do you really want this house? Are you willing to show that you are a serious buyer?
Home Affordable Foreclosure Alternatives HAFA Program
The U.S. government created the HAFA program for homeowners in danger of losing their homes to foreclosure.
The HAFA program is known as the Home Affordable Foreclosure Alternatives Program. HAFA is the acronym for this program.
If you can no longer afford to make the mortgage payments on your home this program might help you. The good part about the HAFA program is that IF your mortgage lender participates in the HAFA program you MAY be eligible for up to $3,000 in relocation money given to you at the closing of your short sale or deed in lieu.
Please note that NOT all lenders participate in HAFA nor do they have to. It is a voluntary program for lenders. All the major big lenders to participate as part of an agreement they made with the government when they got their bail out money.
If you have more than one mortgage on your home both of your lenders must agree to participate in HAFA. Many times your second lien holder is not going to be so amiable but that depends on how much you owe them.
Doing a Florida short sale is a way to participate in the HAFA program. Another benefit of the HAFA program is that you will no longer be responsible for the remaining amount that you would owe your lender. When you do a short sale you still owe the difference between what your mortgage amount is and what you sell the house for. HAFA terms require your lender to release you from any obligation to repay that amount of money and also relieves you of them coming after you later for a judgment.
Doing a short sale has less impact on your credit score than a foreclosure. Very seldom is a foreclosure a better option than a short sale.
The bad part is there is government red tape involved which can drag out the process. If you do not turn in one document within their time frame they can and do many times turn down your HAFA eligibility. This is very important to understand. This is also why it is very important for you to choose a Realtor® who is experienced in listing and negotiating short sales.
You can learn more about the HAFA program on the Making Homes Affordable .gov website.
Contact Nestor Gasset and Katerina Gasset for further information about the HAFA program and if it the right fit for you at 561-753-0135. This is a free confidential call. The call is not recorded. We will go over your foreclosure options so you can decide the best course of action to take for your own individual situation.
Wellington Short Sales Market Report – August 2012
In Wellington Florida currently there are 200 homes on the market. The inventory is down from last month by over 100 homes for sale.
The market in most price ranges in Wellington has certainly turned into a sellers’ market.
There are 47 homes listed as short sales in Wellington right now. So these homes, most of them will get multiple offers on them.
If you were waiting for the right time to buy or were waiting for the market to hit bottom, well, the bottom of the market is when you can see it in your rear view mirror. That time has gone.
Buying a home now is the best time to buy because there is only one place for home prices to go now and that is up. The law of supply and demand.
If you need to sell your home as a Wellington short sale now may just be the perfect time to do so. This is because you will be getting the highest and best price for your home which means your lender is more apt to work with you on your short sale.
The debt relief act is running out in December of this year also. You will want to get your home on the market and close before December 31st of 2012.
Contact Nestor Gasset and Katerina Gasset at 561- 753-0135 to list your home as a short sale in Wellington.
Wellington Short Sale Agents- How We Help Homeowners Through The Process
When we get a call from a homeowner who is facing foreclosure or is just tired of being upside down in their mortgage we have a process that is put in place to assist in discovering their options.
1. We get the call from the homeowner through our website, our blog or a referral source.
2. We let the homeowner know that their call is confidential. We also make it clear that we are not attorneys and we don’t work for their lender.
3. Then we ask the homeowner to tell us their story. As they tell their story we can ascertain many points that will either help or hinder their short sale success. We listen for important details that may be between the lines. Some homeowners are ashamed of their circumstances so they may not realize that they do have an underlying hardship.
4. Then our office manager pulls up the tax appraiser’s report on the property being discussed to find out how far away from a foreclosure they may be. Sometimes homeowners don’t even know that they have been served with the lis pendens. Sometimes they turned over this part of their life to an attorney who may no longer even be in business.
5. Then our office manager pulls up any past or current listing history from the MLS.
6. The office manager puts together a package to give to Nestor who will then go through the package in finite detail to uncover any thing that will help us negotiate for the sellers.
7. Nestor calls the homeowner back to go over what the plan of action could be, the facts in the short sale process and then emails the seller a short sale package.
8. Our office policy is that a short sale listing is not put into the MLS without the seller turning in a completed short sale package along with all necessary disclosures to our office.
9. Most of the time in our area, the homeowner may have already relocated or it is a second home for someone who lives away from Florida. Most of the communication is by email, phone and texting.
10. Once we have the short sale package returned, Nestor looks over the short sale package to make sure he feels it is a scenario that we can get approved by their short sale third party lender.
11. Our office manager sends out the listing agreement through Docusign or E-sign to the sellers. The sellers execute the listing agreement and get it back to our office.
12. Cheska, our receptionist then contacts the seller to set up all the showing instructions.
13. Cheska then uploads the showing instructions to Showing Time – who handles our showing scheduling.
14. Cheska creates a sellers calendar and short sale document in google documents and goes over all of this with the seller. Cheska shows the seller how to use his seller calendar. Each time there is a marketing action for the property it is noted on the seller calendar.
15. Nestor or the office manager arrange for the lock box to be placed on the property. If a sign is allowed by the HOA then the company real estate for sale sign is placed on the property.
16. Nestor or the office manager arrange to get photos taken of the property.
17. Katerina prepares the marketing strategy for the property.
18. Katerina delegates the internet marketing action plans to our virtual assistants who are trained in syndicating the listings and place the online ads.
19. The office manager uploads the listing photos and gets the listing put into the MLS.
20. Most often, in this market, we will get multiple offers on the listing in a short period of time.
This is just from the point of the phone call to getting the listing put into the MLS. There are here, at least 20 tasks that much be accomplished to this point.
After the listing is in the MLS and after the listing is being marketed we will get an offer on the property. Many times we will have multiple offers on a property. We will go over each of the offers with the sellers.
Once an offer is accepted by the seller we move into the negotiating stage of the short sale processing. The next steps are determined by the processing rules of each particular lender. If the sellers are applying for HAFA the tasks will be different than the person applying for a regular short sale. The process is also different for people who have one mortgage on their home versus people who have two or more mortgages on their property.
Once all sides have completed the required steps we put together the short sale package to send to the lender or upload to the lender.
We order the preliminary HUD1 from Infiniti Title. Tina prepares the title documents along with any liens, permitting fees, encumbrances or any other title defects that may create an issue for title.
Nestor applies his charm to the cover letter:)
Once the short sale package is sent we must confirm it was received by the lender. This can be a full time job all by itself. The lenders are infamous for lost files.
But one day it will all be confirmed that the short sale package has been received and is going through the processing department and then assigned a negotiator.
Then we go into negotiating mode. This part of the process can take from a few hours to days or weeks.
When we received the approval letter from the seller’s lender we read the letter making sure it meets with our office requirements. Then we forward the letter on to the seller. The seller than can bring this letter to his attorney or decide if this is a letter he or she is willing to take along with the terms and conditions.
If the seller gives us the green light, we notify the buyer agent that we can now schedule a closing date and time.