It’s a difficult disconnect that makes selling properties a challenge. Successfully marketing a home requires that the price be set carefully — or it will languish on the market. Among the considerations:

1) How many homes are for sale in the neighborhood? The more homes on the market, the more important it is to list at the lower end of the scale. “I want buyers to ask why is this house priced so competitively,” said NAR President-elect Ron Phipps of Phipps Realty in Warwick, R.I. “I want the answer to be an offer.”

2) Take short sales and foreclosures into consideration when pricing. If the competing properties are in lousy condition, they are less of an issue, but if they are well taken care of, yet priced 25 percent below market, they can be a serious factor.

3) Negotiate decisively. “Buyers are not interested in back-and-forth negotiations these days,” Phipps said. “They are less emotional and more disciplined. They will walk away.”

4) Cut the price when you have to. If no one shows up for an open house, if no one calls and if there are no offers, then the price is too high. That means it’s time to make a meaningful price cut.

CoreLogic also predicted that the additional inventory of foreclosed homes could double the time to sell from the current 11-month average.

“Given that the tax credit simply pulled demand forward, the distressed share is expected to rise … during the fall, when non-distressed seasonal sales begin to decline,” analysts said.

Source: Reuters News (09/16/2010)

They work like this: The borrower owes $250,000 on a home that’s now worth $200,000. They stop paying the mortgage, but it takes the bank six months to a year to foreclose and evict the borrower. Meanwhile, he or she pays no house payments and the bank absorbs the negative equity.

The drawback for the borrower is damaged credit and the possibility in some states that the bank will sue for a deficiency judgment.

Paola Sapienza, a professor of finance at Northwestern University and an expert on strategic defaults, points to what he calls the “contagion effect.” As the practice gets more common, the stigma declines and more people say, “Look I’ve done it, and I’m fine.”

Alex Veiga, AP Real Estate Writer, On Thursday September 16, 2010,

LOS ANGELES (AP) — Lenders took back more homes in August than in any month since the start of the U.S. mortgage crisis.

The increase in home repossessions came even as the number of properties entering the foreclosure process slowed for the seventh month in a row, foreclosure listing firm RealtyTrac Inc. said Thursday.

In all, banks repossessed 95,364 properties last month, up 3 percent from July and an increase of 25 percent from August 2009, RealtyTrac said.

August makes the ninth month in a row that the pace of homes lost to foreclosure has increased on an annual basis. The previous high was in May.

Banks have been stepping up repossessions to clear out their backlog of bad loans with an eye on eventually placing the foreclosed properties on the market, but they can’t afford to simply dump the properties on the market.

Concerns are growing that the housing market recovery could stumble amid stubbornly high unemployment, a sluggish economy and faltering consumer confidence. U.S. home sales have collapsed since federal homebuyer tax credits expired in April.

That’s one reason fewer than one-third of homes repossessed by lenders are on the market, said Rick Sharga, a senior vice president at RealtyTrac.

“These (properties) are going to come to market, but very slowly because nobody wants to overwhelm a soft buyer’s market with too much distressed inventory for fear of what it would do for house prices,” he said.

As a result, lenders are putting off initiating the foreclosure process on homeowners who have missed payments, letting borrowers stay in their homes longer.

The number of properties receiving an initial default notice — the first step in the foreclosure process — slipped 1 percent last month from July, but was down 30 percent versus August last year, RealtyTrac said.

Initial defaults have fallen on an annual basis the past seven months. They peaked in April 2009.

Still, the number of homes scheduled to be sold at auction for the first time increased 9 percent from July and rose 2 percent from August last year. If they don’t sell at auction, these homes typically end up going back to the lender.

More than 2.3 million homes have been repossessed by lenders since the recession began in December 2007, according to RealtyTrac. The firm estimates more than 1 million American households are likely to lose their homes to foreclosure this year.

In all, 338,836 properties received a foreclosure-related warning in August, up 4 percent from July, but down 5 percent from the same month last year, RealtyTrac said. That translates to one in 381 U.S. homes.

The firm tracks notices for defaults, scheduled home auctions and home repossessions — warnings that can lead up to a home eventually being lost to foreclosure.

Among states, Nevada posted the highest foreclosure rate last month, with one in every 84 households receiving a foreclosure notice. That’s 4.5 times the national average.

Rounding out the top 10 states with the highest foreclosure rate in August were: Florida, Arizona, California, Idaho, Utah, Georgia, Michigan, Illinois and Hawaii.

Economic woes, such as unemployment or reduced income, are now the main catalysts for foreclosures.

Lenders are offering a variety of programs to help homeowners modify their loans, but their success rates vary. Hundreds of thousands of homeowners can’t qualify or fall back into default.

The Obama administration has rolled out numerous attempts to tackle the foreclosure crisis but has made only a small dent in the problem. Nearly half of the 1.3 million homeowners who enrolled in the Obama administration’s flagship mortgage-relief program have fallen out.

The program, known as Making Home Affordable, has provided permanent help to about 390,000 homeowners since March 2009.

Regardless, many troubled borrowers have seen their efforts to get a loan modification stymied.

Larry Book of Winter Garden, Fla., was one packet away from a permanent loan modification from Chase under the Obama administration’s foreclosure prevention plan after more than a year of back and forth and one failed attempt.

But his modification never went through. Instead, his loan was transferred from Chase to IBM Lender Business Process Servicers in July and he was told he owed $9,562.62 and must bring his mortgage current by Sept. 15 or foreclosure proceedings will begin.

“It just becomes too exhausting,” Book said about the modification process. “That’s why some people walk away. But I’ve invested too much and given up too much to just let it go.”

AP Real Estate Writer J.W. Elphinstone in New York contributed to this report.

All these foreclosed properties offer you a great investment opportunity. You can scout and buy homes in foreclosure, then keep them as rental properties and collect monthly checks from tenants. Or you can purchase foreclosed properties and flip them, renovating and selling the homes for a profit. The time has never been better to use the real estate market to your advantage.I was recently sent a free copy of a great foreclosure book by a real estate pro by the name of Denise Evans. Her book, The Make Money on Foreclosures Answer Book: Practical Answers to More Than 125 Questions on Investing in Foreclosure Property is a straightforward, easy-to-follow guide to making money from foreclosures.

A quick and authoritative reference, the book explains all the elements of the foreclosure process and reveals everything you should keep in mind as you deal with foreclosed properties. The Make Money on Foreclosures Answer Book answers the most common questions about working with foreclosures, covering such topics as:

• Finding properties to buy
• Borrowing money to fund your purchase
• Determining your costs
• Buying pre-foreclosures and buying at auction
• Buying through a bank or the government
• Tax and legal issues
• Bankruptcy
• Dealing with the property’s former owner

Written by a real estate broker and attorney with over twenty years’ experience making money in the real estate market, The Make Money on Foreclosures Answer Book reveals insider tips and strategies that will help you buy foreclosure properties safely and sell them to earn a profit. Check it out on Amazon to buy or read more about it.

About the Author
Denise L. Evans received her law degree from the University of Alabama Law School. She is a licensed real estate broker, an active member of the Commercial Real Estate Club of Birmingham, and a research associate for the Alabama Real Estate Research and Education Center. She resides in Tuscaloosa, Alabama.

When many people think about Caribbean property, images of sandy white beaches and lush tropical greenery may spring to mind. However, it is not just these pleasant images which make Caribbean property so appealing. There are many Caribbean property opportunities available which are tailored for investment and anticipated to generate substantial profits for astute investors.

For a Caribbean property to be tailored for investment, there are two important principles which must be followed.

• Firstly, setup costs must be minimized to allow investment opportunities to be a viable option to most investors. Also, the less your setup costs are in comparison to profit, the higher your return on investment will be.
• Secondly, profit must be maximized. To maximize profit on your Caribbean property, there are several factors which must be given due care and consideration.

For example, many investors would require that their Caribbean property be fully managed to provide a healthy rental income. Therefore a management agency or company would ideally be setup to maximize rental occupancy, room rate charged and to fully manage the day-to-day running of the Caribbean property and surrounding land/site.

A favorable way for this to be setup is to buy a Caribbean property within a hotel or resort which is run by a well known and respected operator. This added brand name can greatly benefit the rental potential of your Caribbean property from day one.

Capital growth is also an important aspect to consider. Investors ideally need to conduct research to ensure that they are buying a Caribbean property which will experience sufficient demand for rental and for re-sale. This ongoing demand will ensure that property values will continue to increase and generate a substantial capital profit if and when the investor wishes to sell their Caribbean property.

There are many tax breaks to benefit from on your chosen Caribbean property. On some islands, there are no capital gains or inheritance tax to pay, making buying a Caribbean property a very attractive proposition compared to buying in other countries.

With due care and consideration, investors will be able to buy a Caribbean property which should adhere to all the above aspects and prove to be a profitable long term investment.

This guest post was written by Dan Chamberlain. If you have any questions or responses to this article, please post a comment below.

Has your number been called yet in the UK or are you just looking for a better overall mortgage rate? If so, now is the time to start looking while interest rates are still reasonable. The hardest part is finding the right person or loan broker to work with (at least in my experience) but with the internet at your fingertips, it’s much easier.

As I mentioned in my previous post about researching home insurance policies, using a search engine comparison site is the best way to compare and find deals catered for you. This is also true when it comes to just about anything these days. Before I order things online, I use shopping comparison sites like Froogle. When I’m searching for health insurance I’ve used ehealthinsurance.com. Now, if you’re living in the UK and looking for a remortgage, I would try a site like remortgage.org.

Remortgage.org makes it easy to speak with a mortgage professional for free advice regarding a remortgage in the UK. After completing 3 steps on their site, you’ll get access to one of their professional remortgage brokers. They will then answer your questions regarding advice on a mortgage or remortgage in the UK. I have yet to personally try them out since I don’t live in the UK but their site is pretty clean and useful which presumably means their staff is professional too.

If anyone has used remortgage.org, I would love to hear about your experiences by commenting below. Our goal is to help share knowledge and real estate information that is useful to all.

Fortunately the internet makes home insurance shopping much easier especially with sites like InsWeb for the US and Money for UK residents. InsWeb provides a free database  which offers quotes from up to 8 insurers and the UK Money site provides up to 20. They are basically search engine comparison sites so you can access quotes from one location without having to hop from one insurance site to another.

There’s also an article on the CNN site under the money section which I recommend reading that discusses the top things to know about insurance. They even provide some other good articles worth reading pertaining to home ownership in general.

Insurance coverage and requirements also vary based on which state and country you live in. For example, I live in San Francisco which is very earthquake prone so an optional earthquake insurance option is available. Others who live in the mid-west are prone to hurricanes so their insurance will be more expensive.  Regardless of your location, it’s always important to seek out and find at least 2-4 quotes before making your decision. Not only will you save money but you’ll also have peace of mind knowing that you didn’t just select the first insurance plan you came across. Good luck in your search!

The Cascade Team Real Estate is pleased to announce the launch of our NEW strategic partnership with Bank of America Home Loans. As a valued client of The Cascade Team Real Estate, you’ll receive $1000 off your closing costs with Bank of America Home Loans. In addition, to our buyer rebate program, this can substantially reduce your out of pocket expenses in closing your new home purchase. In addition, there is an additional $1000 credit if you are purchasing an energy rated home (ask your loan officer for more details). With no origination fees, Bank of America and The Cascade Team Real Estate can save you thousands of dollars on your next home purchase.

WASHINGTON – Major banks are agreeing to give local governments and nonprofit groups the ability to buy foreclosed homes before they are sold to private investors.

The Obama administration says local officials could benefit from acquiring these properties and using the land for redevelopment projects. Congress has provided $7 billion in money to buy the homes.

These groups have been outbid by speculators who are snapping up foreclosures.

The administration says the largest mortgage lenders in the country, including Bank of America Corp. and Wells Fargo & Co. have agreed to let the groups purchase the properties ahead of private speculators.