Doing a foreclosure in San Mateo is going to slam your credit to the mat.
Short Sale If At All Possible
The difference in credit score damage is huge. Wachovia reports you’ll be hit by a 300-350 point hit to your credit for a foreclosure versus 60-80 points for a short sale.
Importance of Credit
You’re at your wits end and want to walk away from the anchor of a house. You’ve tried everything to salvage the situation but it’s hopeless. Get help.
When you try to rent after dumping that ball and chain guess what they’re going to do. Pull your credit. With a 300 point drop good luck renting.
San Mateo County Lenders Are Desperate
They do not want to foreclose and they’re putting their money where their mouth is. Some lenders are making a sweep through San Mateo County and others throughout the state to tell Realtors how to help you avoid foreclosure.
Why don’t they want to foreclose? It’s too expensive. They save $38,000 per house by not foreclosing. You? You get to salvage some of your credit. Get help.
A San Mateo Short Sale house doesn’t refer to how long it takes for the house to sell. The name is misleading. Any unfortunate buyer or seller involved in one can tell you that.
Short Sale refers to the fact that the bank is going to be short money. The house is going to sell for less than the bank is owed.
Why Do Short Sales Take So Long?
It’s pretty typical to see a short sale house on the market for a long time – and I mean a long time. Some Daly City houses have been on the market for over a year.
But why do Short Sales take so long? Well, it’s a long story – just kidding. They take a long time because there are a lot of people involved – a lot more than a regular home sale. There are processes and procedures that have to be followed. And they’re not simple.
Just like any home sale there’s a seller. This seller happens to be the investor who gave the loan. And like any seller would be they’re not happy about the situation.
Want A Deal On A San Mateo Short Sale?
So does everybody else. Inventory has dropped steadily and multiple offers abound. Still want to buy or sell a short sale? Make sure you hire an agent who knows what they’re doing and be sure to get a bottle of Pepto Bismol.
Vicki Moore, Realtor
Certified Short Sale Expert
Alain Pinel Realtors, specializing in San Mateo, CA Real Estate.
Buying? Selling? Need real estate help?
Contact me at 650.888.9268 or Vicki[@]CallVicki.com.
2325 Armada Way is available now and if you come tomorrow between 10 and noon you’ll get one of these cool little cookies from Amy at Cookies By Design.
There’s a lot you should know about your FICO score when you’re getting ready to buy a house – like not to cancel any unused credit cards – but that’s another story a mortgage broker should probably write.
This question came up at an office meeting: How does a short sale effect your FICO? Well, like a lot of crazy things going on in the market right now, we’re not quite sure.
But here’s a good guess…
Short Sale FICO Damage
If you are involved in a short sale your credit score will take an 80-149 point hit. The exact figure most likely depends on the rest of your credit.
You should be able to purchase a home again in about two years.
I’m very curious to see what’s going to happen to the market and how it will be dealt with when all those folks – millions? – who short sold their house want to get back into the market.
Foreclosure FICO Cut
If your property goes all the way to foreclosure your credit score will see a 150-240 point hit.
Five years seems to be the consensus on the time it’ll take for you to be approved for a home loan.
So?
This info isn’t meant to judge, encourage or discourage any decisions about how to proceed. It’s just more information to consider when making a decision that’s appropriate for you.
When Realtors get paid, it’s a trickle-down effect. There are over a hundred other professionals who also get paid: Pest inspectors, property inspectors, photographers, stagers, house cleaners, haulers, painters, window cleaners, title companies, disclosure companies, home owners associations, transaction coordinators, movers, sign companies, printers, landscapers, locksmiths – that’s just off the top of my head.
So what’s the reality of the market? The number of home sales is down – way down. Meaning there are a lot of families struggling out there. Title companies and real estate offices are closing multiple offices at a time – and no doubt that the other companies that service the industry are too.
Here’s the facts:
2000
2001
2002
2003
2004
2005
2006
2007
2008
Atherton
95
75
76
96
108
103
102
80
63
Belmont
255
205
329
343
321
306
261
219
170
Brisbane
32
25
31
31
36
40
27
22
16
Burlingame
303
255
284
293
312
276
266
213
179
Colma
3
3
11
8
9
8
3
3
9
Daly City
387
337
420
552
558
493
501
334
438
East Palo Alto
125
116
127
149
214
195
155
83
165
El Granada
85
60
92
80
83
81
59
53
39
Foster City
220
148
182
220
197
190
144
117
100
Half Moon Bay
155
113
190
165
191
156
121
97
83
Hillsborough
181
141
136
142
169
152
123
127
94
La Honda
20
12
16
18
27
19
15
10
11
Loma Mar
4
1
2
2
2
2
2
4
1
Menlo Park
400
368
464
503
504
455
377
410
300
Millbrae
158
129
194
191
182
186
139
131
114
Montara
35
29
54
52
49
34
25
42
18
Moss Beach
43
35
35
41
33
26
19
20
18
Pacifica
375
325
365
423
377
317
281
193
175
Pescadero
14
8
10
9
15
9
12
8
4
Portola Valley
91
56
63
74
87
91
59
73
53
Redwood City
741
581
716
764
781
718
575
507
491
Redwood Shores
114
73
126
117
124
123
86
88
69
San Bruno
309
256
330
374
320
347
274
163
228
San Carlos
392
340
394
430
419
357
296
296
258
San Gregorio
5
3
2
3
0
1
San Mateo
705
675
811
893
897
766
707
581
473
So San Francisco
348
325
418
417
464
397
342
220
258
Woodside
120
61
86
89
108
97
60
78
48
Summary
5715
4752
5965
6476
6589
5947
5031
4172
3876
Pacifica is a familiar market to me. I grew up there and worked only that market until a few years ago when it became apparent that I needed to broaden my coverage area. Although the number of sales only declined 9% between 2007 and 2008, the dramatic difference is looking at the height – 2003 with 423 houses sold – and then looking at 2008. That’s a whopping 59% decline.
San Mateo is a similar picture: 19% decline between 2007 and 2008. 47% decline from the height of 897 houses sold in 2004 compared to the 473 in 2008.
As I’ve shown in several past statistical reports, Daly City is boucing back. The deal-seekers have hit it hard – sales dropped to a low of 334 in 2007 to 438 in 2008; only 22% off from its 2004 high of 558.
All counties have customs with regard to who pays what fees in a real estate transaction. (Another reason it’s important to have a realtor who specializes in your area of interest.) So what are they in San Mateo?
San Mateo County transfer tax on every real estate sale of $1.10 per thousand dollars, which the seller typically pays.
Buyers are responsible for the escrow and title fees, and their loan fees.
The cities of Hillsborough and San Mateo have city transfer taxes. The seller pays for Hillsborough’s and San Mateo’s is split between the parties. Having said that, I just wrote an offer for a buyer who paid all the fees – yes, all of them. Remember, these are standards. If you want your offer to be better than the next guy’s you may want to consider paying those extras. And you thought the market crashed and burned and lay in ruins.
Other expenses that fall to the responsibility of the seller is the installation of smoke detectors, strapping the water heater and the $130 for the hazard report that’s required in every sale.
Buyers should set aside roughly $1000 for inspections. That’s a high estimate, but sometimes inspections lead to more inspections and you’re better off with an over-estimate. And yes, you should get inspections.
Multiple offers are like that guy balancing the plates. You have to keep them spinning and balanced to keep them from crashing to the ground. Or you could compare it to corralling cats. My job is to get everyone rounded up on the same day and in the same condition – offers should be at a similar stage in the process - to present to the seller.
There’s a regular debate in my office about what to do with multiple offers. Some agents prefer to accept one and move on; others will negotiate in order to get the offer that stands out amongst the rest; while others will wring them out like an old dish rag. There are advantages – and not - to each.
Accepting one and moving on gets things rolling, but there’s one integral piece that inevitably will come back to haunt everyone involved: the buyer believes they could have gotten a better deal and the seller believes they could have gotten more money.
I don’t think treating people like an old rag is the way to go either. Although real estate is a business, it’s my business and I’m not going to disrespect agents and their clients for the sake of money. It’s not necessary – and besides, then I can’t sleep.
My approach to multiple offers is one of fairness while getting the seller the absolute most money and the best terms possible, while leaving my reputation in tact. If my reputation becomes a victim to the moment, there won’t be another chance. It will travel through the community like wildfire; agents will no longer want to work with me and will direct their buyers to other homes – which there are plenty of at the moment.
Even in this strange time of mortgage craziness and an overabundance of inventory, multiple offers do show themselves occasionally. It’s a well-prepared house and sellers who listen to the expert who get that result. So hire an expert and listen.
What in the world do the two have to do with each other? I’m so glad you asked.
I listen to Clark Howard in the morning on 650 KSTE. He has a show dedicated to finances – a good show, I might add. A big topic on the show today - and a lot of days – is identity theft. He suggested that one way to protect your identity is to opt out of credit card application mailings and that it may be especially important prior to a move. Hmm, I thought. Where’s he going with that? Well, when you move, sometimes your mail doesn’t move along with you. Some of it may continue to be delivered to the old address making you susceptible to identity theft.
So add it to your move to-do list or call me when you’re ready to sell ‘cuz I’ve added it to mine.
There are truly no real emergencies in real estate, but one of the worst things you can do is become incognito. I always ask for every piece of contact information I can get; nevertheless, it’s inevitable that someone will go on vacation or out of town and not let me know.
The other day when one of my clients apologized for not getting back to me sooner, I told her: Don’t worry. I know where you live. If necessary, I’ll park myself at your desk or in your driveway. I’ll call you on every phone number I can find, send emails, and even call your mother if I have her number – and sometimes I do!
Although there aren’t any emergencies, there are certainly times when I need to speak with a client RIGHT NOW. If we’re in negotiations or an important decision needs to be made, the last thing I want to find out is that you’re on a plane to tim-buck-two and I won’t be able to get a hold of you for a couple of days or even hours.
The first two weeks of a purchase or sale are the busiest, when you’ll be involved the most. So if you have a business or vacation trip, don’t plan on writing an offer and jumping on a plane to a far off land where you’ll be unreachable. I’ll hunt you down!
Buying and selling real estate is one big negotiation – a game, if you like. It’s strategy, thinking, planning. Each step of the process requires another piece of negotiating and has to be thought-out prior to – with the end in mind. Negotiating is not only complex, it’s crucial to your success in the process. It’s also a key reason to have a Realtor working on your behalf.
This super stressful life experience, is usually surrounded by another stressful event such as marriage, divorce, death, new baby or job change. It’s extremely difficult – I’m willing to say impossible – to navigate the process while also managing the rest of your life. You could unknowingly give your power away in one conversation.
Although being honest is a good policy, when you’re negotiating your sale or purchase you have to remember who’s side you’re on – yours. Think before you speak to another agent, someone at an open house, a neighbor, a prospective buyer, or anyone else for that matter. Rely on your Realtor to negotiate for you and give them all the tools they’ll need to get the job done right.
They take a long time because there are a lot of people involved – a lot more than a regular home sale. There are processes and procedures that have to be followed. And they’re not simple.
