Posts

Has your 2nd mortgage come back from the dead in 2018?

February 8, 2018 | Brian Ruhl

Many homeowners in Southern California that thought their 2nd mortgage they stopped paying on years ago was dead and gone. Alert: The 2nds Are Coming! No, it’s not a bad movie. Savvy and aggressive investment groups are buying up the non-performing mortgage notes from the original servicers or have been waiting in the wings waiting to pounce at the right time. Due to increased home prices in many markets these investors see an opportunity to either foreclose on the homeowner and take the equity that these 2nd mortgages now have or they are contacting homeowners to work out a payoff or get the mortgages to start performing again.

For example, if a homeowner originally owed $300,000 on a 1st mortgage and $100,000 on a 2nd mortgage back in 2011… and the value of the home at the time was $250,000, there would be no equity position in the 2nd mortgage and if you stopped paying on it at the time or filed bankruptcy to discharge it there was no reason for that 2nd mortgage to pursue the homeowner because there was no equity in the home.  Today, that same homeowner may still have the 1st mortgage for $300,000 and the value may be $375,000. That smells like an opportunity for those 2nd mortgage note holders and many are starting to take advantage due to the newfound equity that they see as THEIRS… NOT YOURS.

If you are in Southern California and want advice on your options if this is happening to you, contact me on my cell at 858-212-0395 and I can go over details with you.

Regards,

Brian Ruhl
The Ruhl Team (Top 1% on Trulia and Zillow 5 Stars)
REALTOR – Over 1000 Successful Short Sales
Cell: 619.228.6200
Brian@RuhlTeamShortSale.com
Lic# 01493664 / eXp Realty

WELLS FARGO short sale process and timeline is changing.

January 11, 2018 | Brian Ruhl

I recently posted an article about OCWEN and it’s new practices for reviewing and approving a short sale. It seems that WELLS FARGO is also changing its short sale process to require all applicants to be reviewed and decisioned for Loan Modification prior to an applicant being reviewed for Short Sale. We’re finding that it is needlessly adding an additional 30 days to the short sale approval process. All of our clients have already been vetted for a modification or have no desire to keep the home… so it’s adding an additional month to an already long short sale timeline.  We’ve been tinkering with using a signed statement from the borrower/applicant asking to skip the modification review. I will keep this blog updated with any feedback we get on this tactic. We have been told by several WELLS FARGO representatives that this is a new Federal Guideline through the CFPB.

How is the WELLS FARGO Short Sale Process changing?

These changes will affect short sales moving into 2018. According to a VP at WELLS FARGO their process changed in October and will result in a homeowner reviewed for all retention and liquidation options at the same time.  So they will be reviewed for modification, DIL (deed in lieu), and short sale if they call in for assistance.  They may get approved for one option, two options, all 3 options, or no options. Then they can decide which route to take. The change is to streamline how many times they have to review someone for help.  Now it should be just one time, and the decision gets made.  It will take more time and documents for the review, but the review will then cover all options for the homeowner and they don’t have to keep closing out the review and starting over.  Of course, that assumes the homeowner gives us all of the financial documents we need for the review.  In certain cases, if the homeowner has already been declined for a mod in the past, they can be moved right to short sale and DIL review.

How is the WELLS FARGO Short Sale Timeline changing?

It may increase the timeline 30-45 days.  Currently the WELLS FARGO Short Sale Process can take an average of 5-6 months… so add an additional month to that timeline.

Regards,

Brian Ruhl
The Ruhl Team (Top 1% on Trulia and Zillow 5 Stars)
REALTOR – Over 1000 Successful Short Sales
Cell: 619.228.6200
Brian@RuhlTeamShortSale.com
Lic# 01493664 / eXp Realty

The OCWEN short sale process and the changing timeline

December 13, 2017 | Brian Ruhl

OCWEN short sale process and timeline is changing.

OCWEN is changing its short sale process to require all applicants to be reviewed and decisioned for Loan Modification prior to an applicant being reviewed for Short Sale. We’re finding that it is needlessly adding an additional 30 days to the short sale approval process. All of our clients have already been vetted for a modification or have no desire to keep the home… so it’s adding an additional month to an already long short sale timeline.  We’ve been tinkering with using a signed statement from the borrower/applicant asking to skip the modification review. I will keep this blog updated with any feedback we get on this tactic. We have been told by several OCWEN representatives that this is a new Federal Guideline through the CFPB.

How is the OCWEN Short Sale Process changing?

These changes will affect short sales moving into 2018. According to a VP at OCWEN their process changed in October and will result in a homeowner reviewed for all retention and liquidation options at the same time.  So they will be reviewed for modification, DIL (deed in lieu), and short sale if they call in for assistance.  They may get approved for one option, two options, all 3 options, or no options. Then they can decide which route to take. The change is to streamline how many times they have to review someone for help.  Now it should be just one time, and the decision gets made.  It will take more time and documents for the review, but the review will then cover all options for the homeowner and they don’t have to keep closing out the review and starting over.  Of course, that assumes the homeowner gives us all of the financial documents we need for the review.  In certain cases, if the homeowner has already been declined for a mod in the past, they can be moved right to short sale and DIL review.

How is the OCWEN Short Sale Timeline changing?

It may increase the timeline 30-45 days.  Currently, the OCWEN Short Sale Process can take an average of 5-6 months… so add an additional month to that timeline.

Regards,

Brian Ruhl
The Ruhl Team (Top 1% on Trulia and Zillow 5 Stars)
REALTOR – Over 1000 Successful Short Sales
Cell: 619.228.6200
Brian@RuhlTeamShortSale.com
Lic# 01493664 / eXp Realty

Best Mortgage Lenders to work with for a Short Sale

October 31, 2017 | Brian Ruhl

After completing over 900 Short Sales in San Diego, Riverside, and San Bernardino Counties… we have had experience with every mortgage lender or servicer out there.  I thought it was important to rank the lenders based on their short sale process, systems, and ability of their short sale department to get things done efficiently.   I had my team rank each lender/servicer and the resulting list (below) in order of best to worst is below.  These rankings are always changing so be sure to call or email me if you’d like to know more about how your lender/servicer handles short sales:

Bank of America
Chase
Wells Fargo
Nationstar
OCWEN
Specialized Loan Servicing (SLS)
Select Portfolio Servicing (SPS)
Bayview
Ditech
First Franklin
Citi Mortgage
Citi Bank
Carrington
PNC Mortgage
ClearSpring Loan Servicing
US Bank
Fidelity Bank
First Financial
Fay Servicing
Caliber Home Loans
SunTrust Mortgage
PHH Mortgage
Rushmore Loan Management
Quicken Loans
SN Servicing Corp
California Housing Finance Agency (CalHFA)
GMAC
Capital One
Fannie Mae
Freddie Mac
HSBC
Americas Servicing Company (ASC)
Freedom Mortgage
Navy Federal Credit Union
USAA
North Island Credit Union

Regards,

Brian Ruhl
The Ruhl Team (Top 1% on Trulia and Zillow 5 Stars)
REALTOR – Over 1000 Successful Short Sales
Cell: 619.228.6200
Brian@RuhlTeamShortSale.com
Lic# 01493664 / eXp Realty

The 3 Basic Steps to Complete a Short Sale on Your Home

October 31, 2017 | Brian Ruhl

I’ve had many homeowners call me that wanted a basic overview of the Short Sale process.  It can be a difficult process to summarize because there are so many moving parts and each Short Sale is unique with different lenders, timelines, and properties.  Still, I think it’s important to have a “typical” timeline for what a homeowner can expect and I was able to break it town into 3 basic steps.

Step #1: (Month 1) Consultation to go over details of the process, questions, timelines, and address any concerns. We help you put together the Short Sale package and obtain all lender criteria to submit and start processing the documentation.

Step #2: (Month 2-5) The Ruhl Team directly negotiates and processes the Short Sale with your mortgage lender, obtains a valuation on the home, gets an offer, and procures a short sale approval letter from the lender.

Step #3: (Month 6-7) The Ruhl Team reviews the Short Sale approval letter with you, opens up escrow and helps navigate disclosures and escrow paperwork.  Once escrow is closed, the property is handed over to the new owner and the loans on the home are satisfied. If there is a cash incentive it will be sent directly to you within 48 hours of escrow closing.

Again, it’s important to know that a Short Sale is different for every situation and if you’d like a pinpointed timeline on what to expect… contact me for a Free 30-minute consult.

Regards,

Brian Ruhl
The Ruhl Team (Top 1% on Trulia and Zillow 5 Stars)
REALTOR – Over 1000 Successful Short Sales
Cell: 619.228.6200
Brian@RuhlTeamShortSale.com
Lic# 01493664 / eXp Realty

Bankruptcy and Short Sales

October 4, 2017 | Brian Ruhl
In the current economic environment, the issues of bankruptcy and short sales are still prevalent.  The following information may assist in understanding some of the issues which arise in this context. This information was provided to me by several bankruptcy attorneys that I work with while doing short sales for their clients. Be sure to contact and speak with an attorney because everyone’s situation is different.

BANKRUPTCY: There are two main choices in bankruptcy: Chapter 7 or Chapter 13.

CHAPTER 7: This is the most popular choice in the Bankruptcy Court, as it allows a person to “discharge” (wipe out) consumer debts such as mortgage debt, credit card debt, medical bills and business debts, such as rental property mortgages.  YOU HAVE TO QUALIFY FOR CHAPTER 7 BANKRUPTCY.  QUALIFICATION IS BASED ON YOUR INCOME AND HOW MUCH SECURED DEBT YOU OWE.

CHAPTER 13: This type of bankruptcy is a payment plan that lasts for 3 to 5 years.  It allows a person to pay an affordable monthly payment to satisfy their creditors.  Certain debts do not have to paid in full.  IT IS CURRENTLY THE ONLY BANKRUPTCY WHICH ALLOWS A PERSON TO STRIP OFF (ELIMINATE) AN UNSECURED SECOND OR THIRD MORTGAGE DEBT.

SHORT SALE: This is a procedure where a person sells their house for less that they owe on the mortgage debt.  It requires that the seller’s mortgage company(s) agrees to take less than full payment.  It normally results in a tax liability arising from the “forgiveness of debt” by the mortgage lender (However, a Federal Law eliminates this type of tax, if the forgiven debt is under $2,000,000 and the mortgage debt is a “purchase money” or “home improvement loan” on a personal residence.  NOTE: California tax law limits the amount of qualifying debt to $800,000).  A short sale will cause damage to your credit report and credit score, because the debt is thereafter listed as being “satisfied by less than full payment”.

OK…YOU HAVE THE BASICS…HERE’S HOW IT ALL COMES TOGETHER:

If you are contemplating a short sale and may also need to file bankruptcy, it is almost always a good idea to not complete the short sale prior to filing for bankruptcy.  Why?  Because, the short sale may create a tax liability (which cannot be discharged in bankruptcy) and, by eliminating the secured debt (which you do by the short sale) you make it less likely that you will qualify for bankruptcy (at least Chapter 7).

If you wait to do a short sale until after the bankruptcy proceeding is filed, you get to claim the secured debt (mortgage debt) in your bankruptcy and it helps you qualify to file the bankruptcy.   After you file the bankruptcy, you can still complete a short sale.  If you do so, there is no tax liability, since the debt was eliminated in your bankruptcy, and there can be no claim of “debt forgiveness” which creates the tax liability.

Why do a short sale after filing for bankruptcy?   One reason is that a “short sale” is not as bad a credit score hit as a “foreclosure” would be.  Even though filing bankruptcy is a severe blow to your credit standing and credit score, the additional hit you take with a “foreclosure” on your credit makes it worse.  Further, certain lenders have underwriting criteria which will prevent you from obtaining a mortgage loan in the future if you have a foreclosure on your credit report.

Also a benefit, many lenders and servicers provide moving incentive ranging from $3,000 to $10,000 after a short sale… which may not be the case after a foreclsosure.

A short sale, done correctly, can put you in the clear of all mortgage debts.

This situation results in a concept I have named: “Anticipatory Bankruptcy Filing”.   This concept is simply realizing where your economic road is heading; understanding the requirements to qualify to file bankruptcy, and; filing for bankruptcy before you create a situation that disqualifies you from doing so.

Something to think about before you pull the trigger on a short sale.

Regards,

Brian Ruhl
The Ruhl Team (Top 1% on Trulia and Zillow 5 Stars)
REALTOR – Over 1000 Successful Short Sales
Cell: 619.228.6200
Brian@RuhlTeamShortSale.com
Lic# 01493664 / eXp Realty

Wells Fargo Cracks Down on Extending Foreclosure Dates through Modifications or Short Sales

July 4, 2017 | Brian Ruhl
I’ve been in touch with several contacts at Wells Fargo loss mitigation departments over the last 6 months and it’s become increasingly clear they are trying to remove defaulted debt from their books.  With the slowdown in short sales and foreclosures… along with the expiration of HAMP and HAFA, they finally have time to focus on doing that.

The general rule seems to be that if a borrower has been behind for an extended period of time and has tried a modification as well as a short sale, the loan is ‘earmarked’ and will no longer be eligible to avoid foreclosure.  This is a big change from the last decade where homeowners were able to file modification after modification to extend out their foreclosure date and live in the home without making payments.  Many times this was done with the true intention of keeping the home and agreeing to a suitable payment.  Many times it was just a tool to stay in the home mortgage free.

It’s unclear if other banks and servicers such as Chase, OCWEN, SPS, Bayview, and others will follow suit with the more difficult timelines for homeowners seeking a short sale or modification.  Only time will tell, but bank-friendly trends such as these are often times adopted quickly across the industry.

If you have questions about whether you can extend your foreclosure date with your mortgage lenders through a short sale or modification, give me a call at 619-228-6200.

Regards,

Brian Ruhl
The Ruhl Team (Top 1% on Trulia and Zillow 5 Stars)
REALTOR – Over 1000 Successful Short Sales
Cell: 619.228.6200
Brian@RuhlTeamShortSale.com
Lic# 01493664 / eXp Realty

Has your Bank of America loan been service transferred to Specialized Loan Servicing, LLC?

May 19, 2017 | Brian Ruhl
Bank of America is transferring the servicing rights of a record number of their loans to Specialized Loan Servicing, LLC along with other 3rd party servicers.
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In San Diego, where most of my short sale business is done, three of my current short sale clients have received notices from Bank of America that “Beginning [DATE], your new servicer will be Specialized Loan Servicing, LLC”.  I’ve checked around with other members of my short sale team here in San Diego and have found this is happening on many other files as well… so this is not a coincidence.

1st liens and 2nd liens are being transferred, sometimes even after we’ve received short sale approval from Bank of America.  Obviously, this causes problems with the short sale timing, since we will have to start from scratch with the new servicer.  Just as deflating is that many of my clients are in line for BofA’s Cash Incentive program where they are getting $5,000 to $30,000 to short sale the property.  Once the loan is service released (if it’s the 1st lien) to SLS or another servicer… they will lose this cash incentive.  Often times, this incentive was the only reason they were short selling in the first place.  BofA is dangling a carrot in front of homeowners faces and then ripping it away in many cases.

It’s my personal opinion that if any borrower is enrolled in Bank of America’s short sale program, there should be rules against service releasing that loan.  Especially because of the cash incentives that are promised and then can disappear.

If you reside in San Diego County and would like for information on short selling your home with Bank of America, Specialized Loan Servicing (SLS) or any other lender please contact me for a free consultation.

Regards,

Brian Ruhl
The Ruhl Team (Top 1% on Trulia and Zillow 5 Stars)
REALTOR – Over 1000 Successful Short Sales
Cell: 619.228.6200
Brian@RuhlTeamShortSale.com
Lic# 01493664 / eXp Realty