Do You Have a Distressed Property? If so, this is important to read!

In these difficult times I have found that sometimes homeowners in distress don't always know about options other than foreclosure. The old adage that knowledge is power could not be more important than today with our current market conditions.

There are numerous options that may be available to a distressed homeowner. Two of the most frequently discussed are Foreclosure and Short Sale. Foreclosure is a court supervised process where a mortgage company or other lienholder institutes a legal proceeding against a homeowner who is in default. A Foreclosure process may ultimately result in a public sale of a homeowner's property. A Short Sale, on the other hand, occurs when the homeowner enters into negotiations with the mortgage company or companies to accept less from a third party purchaser than the full balance of the outstanding loan.

What many people do not know is that there are very important differences in homeowner consequences between Foreclosure vs. Shortsale. Let me outline some of those differences:

Issue: Future Fannie Mae Loan - Primary residence. In a Foreclosure, a homeowner who loses a home is ineligible for a Fannie Mae backed mortgage for a period of 5 years. A homeowner who successfully negotiates and closes a Short Sale will be eligible for a Fannie Mae backed mortgage after only 2 years.

Issue: Future Fannie Mae Loan - Non Primary. An investor who allows a property to go to Foreclosure is ineligible for a Fannie Mae backed investment mortgage for a period of 7 years.
An investor who successfully negotiates and closes a Short Sale will be eligible for a Fannie Mae backed investment mortgage after only 2 years.

Issue: Future loan with any Mortgage Company. On any future 1003 application, a prospective borrower will have to answer YES to question C in Section VIII of the standard 1003 that asks "Have you had property foreclosed upon or given title or deed in lieu thereof in the last 7 years?" This will affect future rates. There is no similar declaration or question regarding a Short Sale.

Issue: Credit Score. With a Foreclosure score may be lowered anywhere from 250 to over 300 points and typically will affect score for over 3 years. With a Short Sale only late payments on a mortgage will show and after sale mortgage will be reported as paid or negotiated. This will lower the score as little as 50 points if all other payments are being made. A short sale's affect can be as brief as 12 to 18 months.

Issue: Credit history. A Foreclosure will remain as a public record on a person's credit history for 10 years or more. A Short Sale is not reported on a credit history. There is no specific reporting item for "short sale." The loan is typically reported as "paid in full, settled."

Issue: Security Clearances. A Foreclosure is the most challenging issue against a security clearance outside a conviction of a serious misdemeanor or felony. If a person has a foreclosure and is a police officer, in the military, in the CIA, Security, or any other position that requires a security clearance, in almost all cases clearance will be revoked and position will be terminated. A Short Sale on its own does not challenge most security clearances.

Issue: Current Employment. Employers have the right and are actively checking the credit regularly of all employees who are in sensitive positions. A Foreclosure in many cases is ground for immediate reassignment or termination. A Short Sale is not reported on a credit report and is therefore not a challenge to employment.

Issue: Future Employment. Many employers are requiring credit checks on all job applicants. A Foreclosure is one of the most detrimental credit items an applicant can have and in most cases will challenge future employment. A Short Sale is not reported on a credit report and is therefore not a challenge to future employment.

Issue: Deficiency Judgment. In 100% of Foreclosures (except in States that do not provide for deficiency) the bank has the right to pursue a deficiency judgment. In some successful Short Sales it is possible to convince the lender to give up the right to pursue a deficiency judgment.


If you have any questions, please do not hesitate to call me. You can reach me, Don Ricedorff, at The Wells Group 970-375-7014, don@frontier.net, or at my website at durangorealproperty.com.

Don Ricedorff is a licensed real estate broker in the State of Colorado, with 16 years of experience, and he resides in Durango Colorado.He has numerous real estate designations, which have provided him with an unparalleled education to assist his clients. The designations include:

CRS, Certified Residential Specialist
CRB, Certified Residential Broker
CCIM, Certified Commercial Investment Member
CDPE, Certified Distressed Property Expert
ABR, Accredited Buyer Representation
GRI, Graduate of Realtor Institute
RSPS, Resort and Second Home Property Specialist
CIPS, Certified International Property Specialist
SRES, Senior Real Estate Specialist


He is also an active volunteer in the community and his church. His highest aspiration is spending time with his wife, Janet, and his three children Kelly, Katie, and Kyle. His other interests include playing tennis, fly fishing, hiking, boating, and water skiing.

In Real Estate A Picture Is Worth a Thousand Words!

I have always invested in good cameras and currently use one of the best digital SLR (single-lens-reflex) cameras for photographing listings. I have observed over the years in the real estate business that good pictures create more interest in marketing a property and attract more on-line attention. The importance of good pictures was also recently highlighted in a Wall Street Journal article titled "In Real Estate, A Picture is Worth $1000 or More." The article said that "real estate listings that use photographs taken by the higher-end SLR cameras favored by photgraphers and photography enthusiasts tend to do better than those that use photos from cheaper point and shoot cameras." This was according to a recent study that also showed "that listings with nicer photos get more online attention." The article said that not surprisingly, "listings with better photos command higher asking prices." Despite this, it was indicated that only 15% of listings incorporate higher-end photography.

I take pride that those sellers that choose to list with me are in that 15% that incorporate higher-end photography.

You can contact me, Don Ricedorff, at The Wells Group, 901 Main, Durango, Colorado, 970-375-7014 or via email at don@durangorealproperty.com

Don Ricedorff is a licensed real estate broker in the State of Colorado, with 16 years of experience, and he resides in Durango Colorado.He has numerous real estate designations, which have provided him with an unparalleled education to assist his clients.


The designations include:

CRS, Certified Residential Specialist
CRB, Certified Residential Broker
CCIM, Certified Commercial Investment Member
CDPE, Certified Distressed Property Expert
ABR, Accredited Buyer Representation
GRI, Graduate of Realtor Institute
RSPS, Resort and Second Home Property Specialist
CIPS, Certified International Property Specialist
SRES, Senior Real Estate Specialist


He is also an active volunteer in the community and his church. His highest aspiration is spending time with his wife, Janet, and his three children Kelly, Katie, and Kyle. His other interests include playing tennis, fly fishing, hiking, boating, and water skiing.

10 Facts for Uncertain Times

Take a look at the below excerpt from a recent National Association of Realtors article outlining 10 key facts that do, taken as a whole, show positive signs for the future:

1. The economy is growing, though slowly.
2. The private sector is finally creating some jobs.
3. Consumer confidence remains low, though clearly off bottom.
4. The 30-year mortgage rate is at generational lows.

5. The national median-home price is stabilizing.
6. Other home-price measurements also are showing price stabilization.
7. Home price-to-income ratios have returned to fundamentally justifiable levels.
8. Economists expect price increases in upcoming years
9. Delinquencies are high but recent loan originations are performing well.
10. The long-term path to self reliance may be helped from long-term housing-wealth gains.

Taken from "10 Market Facts for Uncertain Times" September 2010, realtor.org

You can contact me, Don Ricedorff, at The Wells Group, 901 Main, Durango, Colorado, 970-375-7014 or via email at don@durangorealproperty.com

Don Ricedorff is a licensed real estate broker in the State of Colorado, with 16 years of experience, and he resides in Durango Colorado.He has numerous real estate designations, which have provided him with an unparalleled education to assist his clients.


The designations include:

CRS, Certified Residential Specialist
CRB, Certified Residential Broker
CCIM, Certified Commercial Investment Member
CDPE, Certified Distressed Property Expert
ABR, Accredited Buyer Representation
GRI, Graduate of Realtor Institute
RSPS, Resort and Second Home Property Specialist
CIPS, Certified International Property Specialist
SRES, Senior Real Estate Specialist


He is also an active volunteer in the community and his church. His highest aspiration is spending time with his wife, Janet, and his three children Kelly, Katie, and Kyle. His other interests include playing tennis, fly fishing, hiking, boating, and water skiing.

Another Great Durango Event!

Among all the other amenities that Durango, Colorado boasts, it is also often an entertainment and cultural center for the entire four corners area. As an example, this week Durango hosts the Durango Cowboy Poetry Gathering.

Poets and musicians from throughout America grace the intimate stage at the Diamond Circle Theatre at the historic Strater Hotel and also at Durango area elementary schools all week. Don't let the word "poetry" fool you, these entertainers are renowned musicians and storytellers, who also just happen to be real cowboys, farmers and ranchers. They bring American cowboy folklore to life on stage. Numerous other activities occur this week as well, including the Cowboy Poet Train and the Cowboy Poet Trail Ride, both on Friday, October 1, 2010, and the Cowboy Parade in downtown Durango, at 10 am on Saturday, October 2, 2010.

This event does much to preserve and perpetuate the traditions of working ranch people in the American West. It celebrates the lifeways of rural people by creating the “campfire” around which anyone with an interest can come to share in the appreciation of the culture and traditions unique to the West.

For more information and ticket information contact: 970-749-2295 or got to durangocowboypoetrygathering.org

You can contact me, Don Ricedorff, at The Wells Group, 901 Main, Durango, Colorado, 970-375-7014 or via email at don@durangorealproperty.com

Don Ricedorff is a licensed real estate broker in the State of Colorado, with 16 years of experience, and he resides in Durango Colorado.He has numerous real estate designations, which have provided him with an unparalleled education to assist his clients.


The designations include:

CRS, Certified Residential Specialist
CRB, Certified Residential Broker
CCIM, Certified Commercial Investment Member
CDPE, Certified Distressed Property Expert
ABR, Accredited Buyer Representation
GRI, Graduate of Realtor Institute
RSPS, Resort and Second Home Property Specialist
CIPS, Certified International Property Specialist
SRES, Senior Real Estate Specialist


He is also an active volunteer in the community and his church. His highest aspiration is spending time with his wife, Janet, and his three children Kelly, Katie, and Kyle. His other interests include playing tennis, fly fishing, hiking, boating, and water skiing.

An Interesting article on Home Ownership!

I'm reproducing below an article in the Wall Street Journal this week on home ownership. I've deleted some of the images from that article but the text is all below:

ROI

SEPTEMBER 15, 2010, 12:44 P.M. ET

10 Reasons To Buy a Home

Enough with the doom and gloom about homeownership. Brett Arends explains why owning a home is a good thing.

By BRETT ARENDS

Enough with the doom and gloom about homeownership.

Sure, maybe there's more pain to come in the housing market. But when Time magazine starts running covers that declare "Owning a home may no longer make economic sense," it's time to say: Enough is enough. This is what "capitulation" looks like. Everyone has given up.

After all, at the peak of the bubble five years ago, Time had a different take. "Home Sweet Home," declared its cover then, as it celebrated the boom and asked: "Will your house make your rich?"

But it's not enough just to be contrarian. So here are 10 reasons why it's good to buy a home.

1. You can get a good deal. Especially if you play hardball. This is a buyer's market. Most of the other buyers have now vanished, as the tax credits on purchases have just expired. We're four to five years into the biggest housing bust in modern history. And prices have come down a long way– about 30% from their peak, according to Standard & Poor's Case-Shiller Index, which tracks home prices in 20 big cities. Yes, it's mixed. New York is only down 20%. Arizona has halved. Will prices fall further? Sure, they could. You'll never catch the bottom. It doesn't really matter so much in the long haul.

Where is fair value? Fund manager Jeremy Grantham at GMO, who predicted the bust with remarkable accuracy, said two years ago that home prices needed to fall another 17% to reach fair value in relation to household incomes. Case-Shiller since then: Down 18%.

2. Mortgages are cheap. You can get a 30-year loan for around 4.3%. What's not to like? These are the lowest rates on record. As recently as two years ago they were about 6.3%. That drop slashes your monthly repayment by a fifth. If inflation picks up, you won't see these mortgage rates again in your lifetime. And if we get deflation, and rates fall further, you can refi.

3. You'll save on taxes. You can deduct the mortgage interest from your income taxes. You can deduct your real estate taxes. And you'll get a tax break on capital gains–if any–when you sell. Sure, you'll need to do your math. You'll only get the income tax break if you itemize your deductions, and many people may be better off taking the standard deduction instead. The breaks are more valuable the more you earn, and the bigger your mortgage. But many people will find that these tax breaks mean owning costs them less, often a lot less, than renting.

4. It'll be yours. You can have the kitchen and bathrooms you want. You can move the walls, build an extension–zoning permitted–or paint everything bright orange. Few landlords are so indulgent; for renters, these types of changes are often impossible. You'll feel better about your own place if you own it than if you rent. Many years ago, when I was working for a political campaign in England, I toured a working-class northern town. Mrs. Thatcher had just begun selling off public housing to the tenants. "You can tell the ones that have been bought," said my local guide. "They've painted the front door. It's the first thing people do when they buy." It was a small sign that said something big.

5. You'll get a better home. In many parts of the country it can be really hard to find a good rental. All the best places are sold as condos. Money talks. Once again, this is a case by case issue: In Miami right now there are so many vacant luxury condos that owners will rent them out for a fraction of the cost of owning. But few places are so favored. Generally speaking, if you want the best home in the best neighborhood, you're better off buying.

6. It offers some inflation protection. No, it's not perfect. But studies by Professor Karl "Chip" Case (of Case-Shiller), and others, suggest that over the long-term housing has tended to beat inflation by a couple of percentage points a year. That's valuable inflation insurance, especially if you're young and raising a family and thinking about the next 30 or 40 years. In the recent past, inflation-protected government bonds, or TIPS, offered an easier form of inflation insurance. But yields there have plummeted of late. That also makes homeownership look a little better by contrast.

7. It's risk capital. No, your home isn't the stock market and you shouldn't view it as the way to get rich. But if the economy does surprise us all and start booming, sooner or later real estate prices will head up again, too. One lesson from the last few years is that stocks are incredibly hard for most normal people to own in large quantities–for practical as well as psychological reasons. Equity in a home is another way of linking part of your portfolio to the long-term growth of the economy–if it happens–and still managing to sleep at night.

8. It's forced savings. If you can rent an apartment for $2,000 month instead of buying one for $2,400 a month, renting may make sense. But will you save that $400 for your future? A lot of people won't. Most, I dare say. Once again, you have to do your math, but the part of your mortgage payment that goes to principal repayment isn't a cost. You're just paying yourself by building equity. As a forced monthly saving, it's a good discipline.

9. There is a lot to choose from. There is a glut of homes in most of the country. The National Association of Realtors puts the current inventory at around 4 million homes. That's below last year's peak, but well above typical levels, and enough for about a year's worth of sales. More keeping coming onto the market, too, as the banks slowly unload their inventory of unsold properties. That means great choice, as well as great prices.

10. Sooner or later, the market will clear. Demand and supply will meet. The population is forecast to grow by more than 100 million people over the next 40 years. That means maybe 40 million new households looking for homes. Meanwhile, this housing glut will work itself out. Many of the homes will be bought. But many more will simply be destroyed–either deliberately, or by inaction. This is already happening. Even two years ago, when I toured the housing slump in western Florida, I saw bankrupt condo developments that were fast becoming derelict. And, finally, a lot of the "glut" simply won't matter: It's concentrated in a few areas, like Florida and Nevada. Unless you live there, the glut won't have any long-term impact on housing supply in your town.

Write to Brett Arends at brett.arends@wsj.com

You can contact me, Don Ricedorff, at The Wells Group, 901 Main, Durango, Colorado, 970-375-7014 or via email at don@durangorealproperty.com

Don Ricedorff is a licensed real estate broker in the State of Colorado, with 16 years of experience, and he resides in Durango Colorado.He has numerous real estate designations, which have provided him with an unparalleled education to assist his clients.


The designations include:

CRS, Certified Residential Specialist
CRB, Certified Residential Broker
CCIM, Certified Commercial Investment Member
CDPE, Certified Distressed Property Expert
ABR, Accredited Buyer Representation
GRI, Graduate of Realtor Institute
RSPS, Resort and Second Home Property Specialist
CIPS, Certified International Property Specialist
SRES, Senior Real Estate Specialist


He is also an active volunteer in the community and his church. His highest aspiration is spending time with his wife, Janet, and his three children Kelly, Katie, and Kyle. His other interests include playing tennis, fly fishing, hiking, boating, and water skiing.

Am I Listening?

Am I Listening?

As a Realtor, I know my job is not really selling or buying real estate. My job is to help my clients sell or buy real estate. My job is about service and how best to advise my clients on accomplishing their goals as either Sellers or Buyers in this market.

One of my daily challenges is to LISTEN to what my clients are saying so that I can provide the service that they need. At the end of the day, these are the words I want my clients to be able to say about my professional real estate service and the service of my team: They were supportive and honest. They followed-up. They understood. They were aggressive on my behalf. They tried to learn what I wanted. They worked efficiently. They worked on time. They were thorough. They told me the truth about the market.

I feel lucky to be a real estate professional in Durango, Colorado and to call Durango my home. It is always my pleasure and I am grateful for the opportunity to work with people who also would like to hang their hats here!


You can contact me, Don Ricedorff, at The Wells Group, 901 Main, Durango, Colorado, 970-375-7014 or via email at don@durangorealproperty.com

Don Ricedorff is a licensed real estate broker in the State of Colorado, with 16 years of experience, and he resides in Durango Colorado.He has numerous real estate designations, which have provided him with an unparalleled education to assist his clients.


The designations include:

CRS, Certified Residential Specialist
CRB, Certified Residential Broker
CCIM, Certified Commercial Investment Member
CDPE, Certified Distressed Property Expert
ABR, Accredited Buyer Representation
GRI, Graduate of Realtor Institute
RSPS, Resort and Second Home Property Specialist
CIPS, Certified International Property Specialist
SRES, Senior Real Estate Specialist


He is also an active volunteer in the community and his church. His highest aspiration is spending time with his wife, Janet, and his three children Kelly, Katie, and Kyle. His other interests include playing tennis, fly fishing, hiking, boating, and water skiing.

Newsworthy Items for Your Review

Here are some recent newsworthy items that you might find of interest:


Fannie Mae has launched a new website to help struggling homeowners. Fannie Mae's KnowYourOptions.com is a bilingual consumer website designed to outline options that are available to homeowners who are struggling with their mortgage payments. It was launched August 3, 2010.

HUD announced recently that $79 million is available for a broad range of housing counseling programs to help families find and preserve housing. According to HUD these grants will be awarded competitively to hundreds of HUD-approved counseling agencies and State Housing Finance Agencies across the nation that offer a variety of services including how to avoid foreclosure, how to avoid mortgage scams, how to purchase or rent a home, how to improve credit scores, and how to qualify for a reverse mortgage.

You can contact me, Don Ricedorff, at The Wells Group, 901 Main, Durango, Colorado, 970-375-7014 or via email at don@durangorealproperty.com

Don Ricedorff is a licensed real estate broker in the State of Colorado, with 16 years of experience, and he resides in Durango Colorado.He has numerous real estate designations, which have provided him with an unparalleled education to assist his clients.


The designations include:

CRS, Certified Residential Specialist
CRB, Certified Residential Broker
CCIM, Certified Commercial Investment Member
CDPE, Certified Distressed Property Expert
ABR, Accredited Buyer Representation
GRI, Graduate of Realtor Institute
RSPS, Resort and Second Home Property Specialist
CIPS, Certified International Property Specialist
SRES, Senior Real Estate Specialist


He is also an active volunteer in the community and his church. His highest aspiration is spending time with his wife, Janet, and his three children Kelly, Katie, and Kyle. His other interests include playing tennis, fly fishing, hiking, boating, and water skiing.