San Diego Housing Inventory at Low Numbers

Where did all those Home for Sale signs go? They’ve become scarce in San Diego County, leaving home buyers in a competitive situation that few anticipated.

In cities like San Diego, the “buyer’s market” is a thing of the past. Homes are selling faster than they’re coming on the market, and those who seek to get an under market value bargain are finding themselves shut out.

Serious San Diego home buyers need to confine their search to the price range they can afford; then work with an experienced buyer’s agent with a good reputation in the real estate community.

We fit that description.

What difference does the agent make? All the difference.

First, we know what our buyers can ask for safely and what will lead to an automatic rejection. Then, we know how to negotiate in a manner that keeps the lines of communication open – thus leading to an agreement.

Next, your agent’s reputation will be a factor when the listing agent presents multiple offers to the home seller. Our offers are looked upon favorably because listing agents know our buyers either have the cash or have been pre-approved for their mortgage loan. They also know that we’ll do our share of the work while behaving in a professional, pleasant, and cooperative manner.

Other San Diego County agents know us and know we deliver results for our clients.

If you’re ready to own a San Diego home, get in touch. You can reach us by writing td@tomdunlap.com or by calling 619-929-1413.

Thinking of selling your San Diego home?

Your first question is probably “What is my home worth in today’s market?”

To get an instant estimate, just CLICK HERE. Once you enter your address and verify a few details, an estimate of your home’s value will be on it’s way to your inbox.

Then when you’re ready for a more precise market analysis, get in touch. We’ll be glad to prepare an in-depth market analysis.

The Current Equilibrium in San Diego real Estate

The law of supply and demand is distinctly influencing the San Diego real estate market as we move into 2017.

These quick facts tell the story…

  • In a balanced market, the number of homes offered for sale equals roughly 6 times the number of homes sold in the previous month. This is referred to as “Having 6 months’ worth of inventory.”
  • Today in San Diego we have just over 2 months’ worth of inventory

To learn more about the current San Diego real estate market, click here.

Whatever the market… Tom Dunlap sells homes

San Diego’s real estate market in recent years has resembled a roller-coaster, but it makes no difference to Tom Dunlap. A consummate professional, he’s been through the downturns and the upswings many times, and through it all still gets the results his clients want and need.

Write td@tomdunlap.com or call 619-929-1413.!

 

Automated Pricing is Unreliable, and Often Misleading

Listing information on homes offered for today is being syndicated in so many places online that one can easily lose count.

That would be a very good thing if the information was all accurate.

Just out of curiosity I did a search on one of my own listings when it had been on the market for 14 days.

One site’s mobile app showed it having been listed for 155 days – while their desktop showed 556 days. One site named the listing agent from a prior sale as the current listing agent – along with a sadly outdated price. Worse, when I tried to correct the incorrect information on my own listing, I was unable to do so.

Estimated values were up, down, and seldom on target. But why SHOULD we expect these values to be correct?

The computer program can’t see whether the house is finished well or poorly. It can’t see how the house has been maintained – or even if it has broken windows and a tree through the roof. It can’t tell if there’s a panoramic view or if its proximity to schools, shopping, and medical care makes it more attractive.

Automated values can be a starting point. But the only way to estimate the price at which a house will sell is to look at it and compare it point by point to very similar homes which have sold recently in the same neighborhood or one where values are very similar.

Sadly, perhaps due to the extensive and well-placed marketing efforts of online vendors of this information, some homeowners sell out early while others hold out for a mirage. And buyers are sadly disappointed when they learn that the house they just fell in love with on-line actually has a posted list price from a former listing several years ago.

There are many reasons what a buyer should work with an agent from the beginning.

And, maybe it takes one or two tries to find the right match. Associate with an agent early in the process, work together to find more than one choice for best loan programs. Use the app of your choice to do your own home search, and then cross-pollinate the information with your agent. It’s not easy to get 24/7 clean information. It can be a stressful process.

When you have a good agent, all of the hiccups can be addressed early on so you avoid surprises and really focus on making the right choice…fully informed with the latest real data.

What is TIC (Tenants-in-Common) Ownership and Why Should You Consider It?

TIC ownership is a form of real estate investment in which two or more people have a fractional interest in an asset. Ownership shares are not necessarily equal, and ownership interests can be sold or inherited.

Each owner receives an individual deed for his or her undivided percentage interest in the entire property. You, as an investor, could own 99% or you could own 1%. Under IRS Revenue Procedure 2002-22, up to 34 other investors could share ownership with you. (35 total)

Why is this beneficial to San Diego Real Estate Investors?

TIC ownership allows individual San Diego investors to hold an interest in institutional-type property while remaining free of the burden of management.

Such properties attract high quality tenants and are professionally managed and maintained. Rental income is generally reliable.

Low minimum investment and exact dollar matching…

IRS Revenue Procedure 2002-22 allows for a minimum investment of as little as $150,000 – and investments don’t have to be in exact multiples of the minimum. For instance, if the sale of your investment property netted $157,252 you could roll that entire balance into a TIC investment with a $150,000 minimum.

Ask us about current San Diego TIC Investment Opportunities

Our San Diego real estate investment specialists will be happy to show you what’s available. Just write td@tomdunlap.com or call us at 619-929-1413.


Note* The 1031 Exchange information on this site is meant as an overview and is not to be taken as tax advice. To determine how a 1031 Exchange would affect you, please consult your tax advisor and/or your tax attorney.

In a San Diego 1031 Exchange, What is “Like Kind” Property?

When exchanges were first introduced, they were actual exchanges between two parties who held very similar assets.

If you had a two story brick apartment building you had to exchange it for another two story brick apartment building. If your building was in San Diego, you could exchange for a building in another city, but it needed to be very similar in size and structure.

Over time, the definition has evolved, so that now “Like kind” simply means “similar in character or nature.” The property eligible for a 1031 exchange must belong to one of two property classes, and the exchange must stay within that class.

The two eligible classes are:

  • Property used in the taxpayer’s trade or business.
  • Property held for investment.

Today, you can exchange a San Diego single family rental for equity in a multi-story apartment building or even for a share in a TIC (Tenants in Common) property. Read more about Tenants in Common…

Want to know more?

Call 619-929-1413 and speak with one of our San Diego real estate investment specialists.


Note* The 1031 Exchange information on this site is meant as an overview and is not to be taken as tax advice. To determine how a 1031 Exchange would affect you, please consult your tax advisor and/or your tax attorney.

History of the 1031 Exchange

The first income tax law was enacted in 1918 – and it appears that it didn’t take long for politicians to begin adding loopholes to ease the tax burden for themselves and/or their cronies.

The exchange exemption was added to the tax code in 1921, under Section 202. It stated that there would be no gain or loss on exchanges of “like kind” property. At that time the definition of “like kind” was so narrow that one wonders how anyone ever used it.

If you had a two story brick apartment building you had to exchange it for another two story brick apartment building.

The code section was changed to 112(b)(1) in 1928, and then in 1954 Section 1031 was enacted. Section 1031 stated that: “No gain or loss shall be recognized if property held for productive use in trade or business or for investment (not including stock in trade or other property held primarily for sale, nor stocks, bonds, notes, certificates of trust or beneficial interest, or other securities or evidences of indebtedness or interest) is exchanged.”

Thus, in 1954 the definition of “like kind” shifted to something more like “similar.”

In looking at the 1954 tax code it’s clear to see why taxpayers wanted every loophole. The 24 income tax brackets ranged from 20% (for those earning $2,000 or less per year) up to 91% (If you earned $300,000).

But the whole process of finding two people who wanted to exchange was cumbersome. And that difficultly led to the Starker lawsuits – which led to today’s delayed exchanges.

In 1967 the Starkers entered into two similar agreements, one with the Longview Fibre Company and the other with the Crown Zellerbach Corporation
.
In both transactions the Starkers agreed to transfer timberland to the timber companies in exchange for a promise and credit in the amount of the value of the land transferred. The timber companies promised to acquire property of the same value and transfer it to the Starkers. This was to be done within a period of 5 years or the Starkers would be paid in cash. Both companies did acquire and transfer parcels to the Starkers, and the Starkers subsequently claimed exemption from tax under section 1031.

The IRS said “no way” and the cases went to trial. After two lawsuits were ultimately decided (in favor of the Starkers) by the appeals courts, new regulations approving delayed exchanges were added to the tax code in 1975.

Now it was no longer necessary for two parties to an exchange to be in current ownership of the properties to be exchanged. The Tax Court reversed this ruling in 1977, and the 9th Circuit reinstated it in 1979.

The next big change…

In 1984 Congress amended Section 1031 to allow sellers to place the proceeds of a sale with a qualified intermediary while they themselves identified property to be purchased with those proceeds. New regulations implemented the current 45 day identification period and the 180 day exchange period.

1991 revisions clearly defined “constructive receipt” and set restrictions on the identity of the qualified intermediary as a safe harbor.

In 2002 procedures were revised to clarify TIC (Tenants in Common) interests.

Today, a 1031 Exchange must be completed under the strict IRS guidelines – but it’s worth it.

Want to know more?

Call 619-929-1413 and speak with one of our San Diego real estate investment specialists.


Note* The 1031 Exchange information on this site is meant as an overview and is not to be taken as tax advice. To determine how a 1031 Exchange would affect you, please consult your tax advisor and/or your tax attorney.

A San Diego 1031 Exchange is Not a Do-it-Yourself Project

The information we’ve provided here is an over-view of a complex transaction that should only be undertaken with the aid of qualified advisors.

You’ll need a well-oiled team of San Diego professionals to assure your success:

  • A San Diego real estate agent who is familiar with the rules and regulations and who will help you work within the strict time frames required by the exchange.
  • An experienced, qualified tax advisor who specializes in 1031 exchanges and can help you determine your equity position in both the relinquished and replacement properties
  • A Qualified Intermediary – also known as a facilitator – to handle the proceeds of sale and prepare the paperwork.

The rules surrounding a 1031 Exchange are complex, and if broken will result in tax liability.

Do not undertake this project without qualified help.

If you’d like to exchange your current San Diego investment property for something different, but you’re not sure where to start, give us a call at 619-929-1413 or write td@tomdunlap.com.

Our San Diego real estate investment specialists will be glad to discuss your situation and put you in touch with other professionals who can and will help guide you.


Note* The 1031 Exchange information on this site is meant as an overview and is not to be taken as tax advice. To determine how a 1031 Exchange would affect you, please consult your tax advisor and/or your tax attorney.

In a San Diego 1031 Exchange, what does the word “exchange” really mean?

Most of us think of an exchange as a trade between two parties. School kids exchange an apple for an orange at lunch, new acquaintances exchange business cards, or a shopper returns an item to a store in exchange for a different item.

All of these exchanges involve another person or entity. And when exchanges were first introduced into the tax code, they did involve two parties who wished to “trade” properties.

All that changed in 1967 with the Starker lawsuits. (See: History of the 1031 Exchange.)

Today a 1031 Exchange involves one taxpayer who wishes to exchange his or her interest in one property for interest in another property.

What kind of San Diego real estate is eligible for a 1031 exchange?

1031 Exchanges deal primarily with 2 or the 5 classes of property:

  • Property used in the taxpayer’s trade or business.
  • Property held for investment.

In some instances a third class, vacation homes, may fall under the 1031 guidelines. Ask your tax advisor if your vacation home will qualify.

What are the other classes of property? Property held for sale to customers and property used as a taxpayer’s principal residence.

Want to know more?

Call 619-929-1413 and speak with one of our San Diego real estate investment specialists


Note* The 1031 Exchange information on this site is meant as an overview and is not to be taken as tax advice. To determine how a 1031 Exchange would affect you, please consult your tax advisor and/or your tax attorney.

Doing a Successful San Diego 1031 Exchange Means Following the Rules

When you want to exchange the equity in your San Diego investment real estate for equity in a property with even greater income potential, a 1031 Exchange will give you more equity to work with. You won’t be subject to capital gains tax on the profit – or on the depreciation you may have taken since acquiring your present property. Funds that would go to taxes in an ordinary sale can instead be rolled into your new investment property.

But you do have to follow strict rules, and one of those rules is that you as the seller may never come in possession of the proceeds of your sale.
 

A Qualified Intermediary must be appointed to hold the 1031 exchange proceeds, create the exchange, and prepare the legal documents.

This intermediary must be an uninvolved third party and may not be a relative or agent of the exchanging party, except that a real estate agent may serve as the intermediary if the current transaction is the only instance in which the agent has represented the exchanging party in the past two years.
 

Next are the timing restrictions.

Under the 1984 rule changes, the exchange may be delayed, but with time restrictions.

Property identification

Once your original San Diego investment property is sold, you have 45 days from the closing date to either close on or identify a potential replacement property or properties. Such identification must be in writing.
This time restriction is not negotiable, and the 45 days includes both holidays and weekends. If you wait until day 46, capital gains tax on your sale is sure to follow.

To complicate matters, you have some options in identification.

  • You can, of course, identify only one property.
  • You can use the 200% rule. Under this rule you may identify any number of properties as long as the aggregate value of the properties doesn’t exceed 200% of the value of the relinquished property.
  • You can use the 95% exemption. In this case you may identify any number of properties as possible replacements, but you must purchase at least 95% of the aggregate value of all the properties identified.

Of course, the 45 day “identification” period doesn’t prevent you and your San Diego real estate agent from doing your homework ahead of time. You can certainly pre-identify and inspect both the properties and the financials so you’re ready to act when the sale of your original property closes.
 

Closing on the replacement property

You have only 180 days from the closing date on your relinquished property in which to close on the purchase of the replacement property. Again, the restriction is not negotiable. 181 days won’t do.

And… if the due date for your income taxes falls within that 180 day time frame, that due date becomes your end date. Thus, it’s probably unwise to sell under a 1031 exchange after November 15 if your taxes will be due on April 15.
 

To effect complete tax deferment, the following three restrictions must be met.

1. The properties involved must be “like kind.”
2. The total purchase price of the replacement property must be equal to or greater than the total net sales price of the relinquished property.
3. All of the equity from the sale of the relinquished property must be used to acquire the replacement property.

The “like kind” rule is absolute. You may engage in a transfer that results in cash profit from the relinquished property, but in that case, tax will be due on any non-like kind profit – also referred to as “boot.”
 

What is “boot?”

“Boot” is the money or fair market value of any additional property received by the taxpayer through the exchange.

“Money” is taken to mean all cash equivalents, debts, and /or liabilities to which the exchanged property is subject. Determining the relative liabilities and their effect on your transaction is a job for a knowledgeable San Diego CPA, working in conjunction with your tax advisor.

“Additional property” could be taken to mean any property which is not “like kind.” For instance, a personal residence or vacation property not used in the taxpayer’s trade or business and not held for investment.
 

To learn more, just call…

If you think a 1031 Exchange might be right for you, call 619-929-1413 and talk to one of our San Diego real estate investment specialists. We’ll be happy to give you more information and help you determine the value of your current holdings.


Note* The 1031 Exchange information on this site is meant as an overview and is not to be taken as tax advice. To determine how a 1031 Exchange would affect you, please consult your tax advisor and/or your tax attorney.

Zombie Foreclosures – an Endless Nightmare

Are you still liable for the house you lost through foreclosure?

Are bills for water, sewer, HOA dues and property taxes accruing right now – in your name? Is the City preparing to sue you for letting the yard become overgrown and littered?

If yours was a zombie foreclosure, the answer is yes.

Zombie Foreclosures are one more reason why a short sale is the safest course of action for underwater San Diego homeowners who can no longer keep up with mortgage payments. A short sale the only option that is absolutely over when it’s over.

Here’s what happens in a Zombie foreclosure…

Homeowners who let their homes go into foreclosure often move out after the bank notifies them that the auction date has been set. They assume that on the date specified, ownership will have transferred from them to their lender. Unfortunately, that isn’t always the truth.

Banks do what they believe to be in their own financial best interests – without regard to how their actions will affect homeowners.

That’s why banks, in their quest to avoid costs, sometimes do not complete the foreclosure process. Instead, they postpone the auction date. That lets the bank off the hook for property taxes, city services, and homeowners’ association dues. It also absolves them of responsibility to maintain the house and grounds in keeping with neighborhood standards.

In the $25 billion settlement with the state attorneys general in 2012, the nation’s five largest mortgage lenders agreed to inform borrowers of any decision to forgo or delay a foreclosure. But they don’t always adhere to that promise, and homeowners don’t always read their mail.

And therein lies the nightmare.

Thousands of homeowners who believed that they no longer had any legal interest in their homes are now being presented with bills from cities, counties, and homeowner’s associations – where property taxes, water and sewer services, and dues have not been paid since the homeowner moved away. In some cases, where an abandoned home has been vandalized and/or the properties have been left to the forces of nature, cities are also looking to the homeowner of record to make repairs, clean up the yards, and bring the homes up to neighborhood standards.

It gets worse…

In other cases, the banks take title, then simply don’t do the paperwork correctly. So while the former homeowner believes they’ve been cleared of the debt through the foreclosure, the banks are still reporting to the credit bureaus, claiming thousands of dollars still due and owing. The result is that no matter how well that homeowner has taken care of bills since the foreclosure, their credit scores remain in the gutter.

A second problem rears its ugly head when former homeowners are hit with judgments against them for the 2nd and even 3rd liens against the property. Banks don’t have to take immediate action when they decide to collect, so it could be 2 or 3 years before that former homeowner realizes that his or her secondary liens were not wiped out by the foreclosure.

What’s the solution?

If your home has already been foreclosed upon, check with your county tax assessor’s office to see whether they still show you as owner. Also check with your homeowner’s association to verify that ownership has legally been transferred to the bank. If not, call us for further assistance to determine the outcome. We have access to software and data that is more up to date than the public data banks.

If you’re underwater and behind on payments right now, choose the only SAFE solution: List your San Diego or San Diego County home as a short sale.

The short sale process will absolutely transfer ownership from you to your buyer. In addition, none of your lien holders will be allowed to sue you for a deficiency. When it’s over – it will be over.

You won’t suddenly – 2 or 3 years down the road – find yourself facing Zombies.

You’ll be able to get on with your life, begin rebuilding your credit, and purchase a new home within 2 or 3 short years.

So if you’re behind, call us today. We’ve helped thousands of San Diego homeowners avoid foreclosure – and we’d like to help you too.

You can reach us by writing td@tomdunlap.com or by calling 619-929-1413.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Loan Modifications: The big promise / the even bigger disappointment

HAMP Loan Modifications are a prime example of promises broken.

When HAMP was created in 2009, it was expected to help up to 4 million homeowners avoid foreclosure within the first several months. It has fallen far short of expectations.

Meanwhile, from 2007 through mid-2016, more than 18 million homes in the U.S. were foreclosed upon.

Lenders servicing loans owned or guaranteed by Fannie Mae or Freddie Mac are required to participate in the HAMP program. However, the program has been plagued by servicer non-compliance and complete lack of enforcement.

The government promises a financial incentive for servicers who assist homeowners with loan modifications. However, the financial incentives that encourage them to pursue foreclosure are often more appealing.

In addition, HAMP only requires modification of loans which meet the net present value test. This test determines whether the modification will or will not save the investor’s money. If they determine that foreclosure is more profitable, the permanent loan modification will not be granted.

But they take their time in making this determination.

As a result, homeowners who hope to save their homes through a loan modification are often strung along for years, submitting and re-submitting documents, then sometimes being granted a trial modification. All too often, months of making trial modification payments result in a final verdict of “no,” and the house is taken in foreclosure.

Sadly, lenders know from the outset which modifications will be turned down. It’s a simple matter of plugging the numbers into a computer program. We have that program in our office and can tell homeowners within minutes whether pursuing a loan modification is worthwhile.

Private loan modifications report higher numbers, with more than 4.5 million loans modified over the same period of time. Called proprietary loan modifications, these are “in-house” plans that can vary greatly from one situation to the next. Some have adjustable terms that can increase payments in the future. Others have profit sharing terms that bring immediate relief and promise repayment to the bank if there’s a profit on an eventual sale.

Principal reductions are not usually the reality.

Statistics show that principal was reduced in only 17.1% of all loan modifications. In 77.2% the interest rate was reduced, while other modifications simply extended the terms of the loan. One woman reported a less than 10% drop in her payment amount – but an extension from 23 years to 40 years left on her loan.

In more than 10% of the modifications, the monthly payment was not reduced. Actual reductions in monthly payments ranged from zero to as much as 35%.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

If you have a home to sell in San Diego, today’s market is good news.

Right now, the demand for homes in San Diego is strong, and correctly priced homes are selling quickly.

Because the supply of homes for sale in San Diego is at far lower than normal levels, we’re seeing fifteen or twenty buyers competing for each home priced at market value – and many of those buyers have cash in hand. As a result, San Diego homes are now selling at or above their listed price.

In a balanced market, homes typically sell for 95% to 98% of list price.

If you owe more than your house is worth in today’s market, now is the time to short sell.

Consider these facts:

  • If you offer your house as a short sale now, you’ll have good offers to choose from. You’ll spend less time negotiating with a buyer; and when you present your lender with a solid offer from a well-qualified (or cash) buyer, you’ll increase your chances of getting a speedy and positive response.
  • Getting this over and done with now will free you to get on with life – and within 2-3 years you’ll be eligible for a new mortgage loan. (If you let the house go into foreclosure, you’ll wait for 5-7 years.)
  • The sooner you close this chapter, the sooner your credit profile will recover.

What can we expect in the coming months?

We have no way of knowing. However, prices have continued to rise in San Diego over the past 4 years.

This is a situation that equity sellers should also consider carefully as they weigh their alternatives.

  • The current market presents a unique opportunity for move-up sellers. Due to the law of percentages, selling a mid-range home to purchase a high end home means “losing” a little to gain a lot.

If you’d like to learn your home’s value in today’s market, or if you have questions about short sales, please call 619-929-1413 or write td@tomdunlap.com.

We’ll be glad help…

P.S. Are you SURE you need a short sale?

The San Diego real estate market is changing rapidly, so your home that was underwater last year may no longer be underwater.

To get an estimate of your home’s current value, just CLICK HERE to get an instant estimate.

Then call 619-929-1413 or write td@tomdunlap.com to request a detailed market analysis.

There just might be good news in your future…


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

*Source: www.zerohedge.com

Loan Modifications – The First Step Breaks Homeowners’ Hearts

Most homeowners who want to keep their homes have one thing in common: They’ll do almost anything to keep from missing a mortgage loan payment.

They’ll do without things, sell their toys, go deeply in debt on their credit cards, and even borrow from family members rather than default on that loan.

So the first step toward loan modification is heart-wrenching as well as financially dangerous. That first step is to stop making payments.

This, the banks say, is the proof they need that you are unable to meet the current payments. It verifies your hardship and makes you eligible for modification.

Unfortunately, it’s also the reason they sometimes use for denying a permanent modification. That is just one of the reasons, however. Some are denied because the bank decides they don’t have enough income to make the reduced payment (even as the homeowner has been faithfully making the payment). In other cases, homeowners were turned down because they took a second job to make ends meet and now their income was a few dollars too high. Another woman, after 3 years of submitting paper after paper after paper, was turned down because she didn’t file the right paper.

The greatest tragedy in the loan modification scam is the emotional and financial toll it takes on entire families.

It’s common for homeowners to struggle for 2, 3, or even more years to try to achieve a loan modification. During this time they’ve been shifted from one asset manager to another – and have been required to re-submit documents over and over again. And all this time they don’t know whether they’ll be successful or not.

When at last they’re granted a trial modification, they’re offered hope. In just 3 months they should be granted a permanent modification and life can get back to normal. But no. Even though the guidelines call for just 3 trial payments, they’re often told that there’s a delay – but keep making those trial payments.

One gentleman said he paid 14 trial payments before Chase decided he didn’t have sufficient income to continue. His attorney is filing a legal challenge.

And he is not alone. According to a lawsuit filed against JPMorgan Chase, the bank has “extended, delayed and otherwise hindered” the mortgage modification process in thousands of California cases. The nonprofit Housing and Economic Rights Advocates, who filed the class action suit, contend that the bank has profited from payments borrowers make in temporary modification payments. Then they foreclose.

A spokesman for the group says there’s a dark motive behind this behavior. JPMorgan Chase purchased Washington Mutual loans for pennies on the dollar. They could easily afford to modify these loans and still make windfall profits – but the profits from foreclosure are even greater.

And of course, Chase is not the only bank stringing people along. Complaints about Bank of America, Wells Fargo, and others are rampant on the Internet.

One Bright Spot…

Fannie Mae has recently announced that borrowers and their real estate agents can escalate problems with loan modifications and short sales directly to Fannie Mae, bypassing the asset managers.

We have yet to learn whether escalation leads to success, but it seems like a step in the right direction.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Fannie Mae to Allow On-time Borrowers to Walk Away… Should You Sign a Deed-in-Lieu?

If you’re an underwater California homeowner, the answer is probably “No.”

In California, you’re far better off to choose a short sale. Here’s the real story…

At first glance, the Announcement that starting in March 2013 Fannie Mae and Freddie Mac would let borrowers who are current on their payments sign a “mortgage release” and “wipe out their debt,” sounds good.

But keep reading. While the announcement says they’ll allow on-time borrowers to walk away from their underwater mortgage debt, it goes on to say that only certain homeowners will be eligible. You must first show a valid reason why you need to move. This could be illness or a job change.

And while they use the words “wipe out the mortgage debt,” that only applies to borrowers without financial reserves – and without second mortgages.

Borrowers can be required to pay up to 20% of their financial reserves to help make up the shortfall – or be required to sign a promissory note for future no-interest repayments.

In addition, the second lien holder can demand payment before releasing its lien.

And, since the mortgage release is simply a deed-in-lieu transaction, and will report to the credit bureaus just as if you went through a foreclosure, it’s a pretty hollow victory.

In California, if you short sale instead of waiting for a foreclosure or signing a deed-in-lieu, none of your lien holders can demand payment for the shortfall.

Our opinion: If you’re a California homeowner with financial assets and/or a second mortgage, you’ll be far better off to short sell the house. You may need to have a few late payments show on your credit report, but you’ll actually walk away free from that mortgage debt. In addition, you’ll be eligible for a new mortgage loan 3 to 5 years sooner.

We have the experience and the negotiating expertise to get your short sale closed. So before you risk your financial future, give us a call. You can reach us by writing td@tomdunlap.com or by calling 619-929-1413.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

How Insolvency Can Help You Avoid an IRS Bill

The idea of owing the IRS more money than you can afford to pay is enough to strike fear into any heart. And that’s what would have happened to thousands of California homeowners had Congress not consistently extended the Mortgage Debt Relief Act – now in force through 2016.

However, homeowners who have been struggling financially have no real needed to worry.

While the term “insolvent” is not one that most of us would like to apply to ourselves, the IRS definition of this term may be the saving grace for California homeowners whose mortgage debt far exceeds the current value of their homes.

The following is excerpted from the IRS instructions found at www.irs.gov.

We’ve included official IRS definitions as referenced and found later in their text. Notes in parentheses are ours.
………………………
Insolvency

Do not include a canceled debt in income to the extent that you were insolvent immediately before the cancellation. (emphasis mine – note the date)You were insolvent immediately before the cancellation to the extent that the total of all of your liabilities was more than the FMV of all of your assets immediately before the cancellation. For purposes of determining insolvency, assets include the value of everything you own (including assets that serve as collateral for debt and exempt assets which are beyond the reach of your creditors under the law, such as your interest in a pension plan and the value of your retirement account).

Liabilities include:
• The entire amount of recourse debts,
• The amount of nonrecourse debt that is not in excess of the FMV of the property that is security for the debt, and
• The amount of nonrecourse debt in excess of the FMV of the property subject to the nonrecourse debt to the extent nonrecourse debt in excess of the FMV of the property subject to the debt is forgiven.

You can use their Insolvency Worksheet to help calculate the extent that you were insolvent immediately before the cancellation.

This exclusion does not apply to a cancellation of debt that occurs in a title 11 bankruptcy case. It also does not apply if the debt is qualified principal residence indebtedness unless you elect to apply the insolvency exclusion instead of the qualified principal residence indebtedness exclusion.

Qualified Principal Residence Indebtedness

You can exclude canceled debt from income if it is qualified principal residence indebtedness. Qualified principal residence indebtedness is any mortgage you took out to buy, build, or substantially improve your main home. It also must be secured by your main home. Qualified principal residence indebtedness also includes any debt secured by your main home that you used to refinance a mortgage you took out to buy, build, or substantially improve your main home, but only up to the amount of the old mortgage principal just before the refinancing.

How to report the insolvency exclusion. To show that you are excluding canceled debt from income under the insolvency exclusion, attach Form 982 to your federal income tax return and check the box on line 1b. On line 2, include the smaller of the amount of the debt canceled or the amount by which you were insolvent immediately before the cancellation. You can use the Insolvency Worksheet, to help calculate the extent that you were insolvent immediately before the cancellation. You must also reduce your tax attributes in Part II of Form 982 as explained under “Reduction of Tax Attributes.”

…………………………………………………

Remember that the insolvency exclusion applies to all forgiven debt. So if you got a reduction on a credit card account in exchange for full payment, or if a credit card company “wrote off” your debt, you’ll owe the income tax if you can’t prove insolvency.

If you think you may be eligible for tax relief under these IRS rules, please contact your tax professional for further advice.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Can I Short Sell a San Diego House in Probate?

Yes, you can short sell a San Diego house in probate. We’ve done this successfully for many clients, and it’s a good idea.

Short selling before the estate is settled can be a helpful tool, especially if the estate or the heirs are struggling to keep up with mortgage payments. If the house is to be sold, it’s better to get it done quickly rather than pour estate or family resources into a house that’s upside down.

And – getting it “over and done with” can prevent the estate from exposure to a collections lawsuit on HELOCs and other junior lien holders should the first mortgage foreclose.

A San Diego short sale during probate is simply a smart way for an estate to make sure that they’ve cleaned up any lingering liabilities.

In addition to protecting the estate from liability, short selling now while there is but one executor to sign the paperwork can be much easier than waiting until two or more heirs would need to come into agreement. As it turns out, a short sale is often more streamlined when the debtor is deceased.

No two San Diego short sale situations are exactly the same, so we’d be glad to meet with you and discuss the best course of action for your specific situation.

You can reach us by writing td@tomdunlalp.com or by calling 619-929-1413.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

San Diego Short Sales Frequently Asked Questions

 

Is a San Diego short sale right for you?

 We’re here to help and will be glad to explain the real estate short sale process to you.

If you have specific questions related to your own situation, or don’t find the answers you’re seeking here, you are welcome to click here to write us with your questions.

Talking carries no obligation, so don’t hesitate.

You can also reach us by calling 619-929-1413.

Facts to Consider in decision making…

When should I consider a San Diego short sale? Is now the time?

Underwater and unable to make payments: What Are The Alternatives to Foreclosure?

What about signing a deed-in-lieu? Is it safer than a foreclosure?

Not sure if you qualify for a San Diego Short Sale? These hardships and others will help you qualify.

Want the bank to agree to the short sale of your San Diego home? You’ll probably need to stop making payments.

In a San Diego short sale,
do I have to know who owns my mortgage loan?

I’ve stopped making payments.
Do I have time to short sell before foreclosure?

A serious financial decision:
Should You Keep Making Payments on an Underwater San Diego Home?

Take some advice from financial gurus: See What Dave and Suze Have to Say About San Diego Short Sales

What About Strategic Default? Is it a safe alternative?

When you’re depressed and discouraged…Is it possible to just walk away?

Am I stuck with foreclosure, or can I Short Sale my Vacation Home or Second Home?

Divorce what to do with the house?

 

Facts to Consider Before Choosing A San Diego Short Sale Listing Agent

You need a listing agent who stays on top of your transaction: The Value of Persistence in a San Diego Short Sale

You need a knowledgeable agent, because …
In San Diego Short Sales, Knowledge is Power

You need an experienced agent, because
San Diego Short Sale Success is Often Determined by the Initial Application

There is a very good reason…Why Over 40% of California Short Sales Fail to Close

Successful short sale listing agents must possess extra skills.
Does your short sale real estate agent know how to prepare a HUD-1?

Your listing agent needs a reputation for getting short sales closed, because otherwise Some Agents Won’t Show Short Your Sale Listing

 

The Most Common Short Sale Questions and Concerns

I’m the executor of an estate. Can I short sale the house while it’s still in probate?

The answer to this depends a lot on your agent: How long does a short sale take?

Help! I don’t have the money for my San Diego property taxes! Why you don’t need to worry.

I’d rather not move, so Can I buy back the house I’m short selling?

Who decides which short sale offer to accept? The Homeowner.

My second mortgage is a home equity line of credit. Can I still sell short?

I’m underwater on my San Diego vacation home. Is it possible to Short Sell a second home?

Don’t pay an agent to list your short sale, because It should cost nothing to list your San Diego home as a short sale.

It also costs you nothing to SELL your home as a short sale: How do you get paid when you represent me in a San Diego short sale?

How a San Diego Short Sale Will Affect Your Credit and Your Future Plans

A little-known danger in allowing foreclosure: The Zombie Foreclosure Nightmare

How You Can Own Another Home After a San Diego Short SaleTake these steps to assure your success.

How long will I have to wait to buy another home after a San Diego short sale? Here’s what determines your wait time.

Short Sale vs. Foreclosure – How Each Will Affect Your Ability to Buy Another Home

Protect your credit and your future: Don’t use your Visa to make your San Diego home mortgage payment!

Yes, a short sale will affect your credit.
Here are the issues you’ll face.

 

Short Sales and Your Taxes


What possible tax issues might I have with a short sale?
An overview of IRS regulations.

Short Selling a Second Home?Talk with your tax adviser.

If I short sell my home, will I have to pay the past due property taxes?

If I don’t have to pay income tax on my forgiven mortgage debt, why did I get a 1099 form?

Definitions

What is an upside down mortgage?

What is a Deed in Lieu?

What is forbearance?

What are recourse loans?

What are deficiency judgments?

Forensic Loan Audits – Do You Need One?

What is loan modification, and should I attempt it?

 

About Loan Modifications

HAMP Loan Modifications – a promise broken. Lack of servicer compliance and lack of enforcement have turned HAMP modifications into a nightmare ending in foreclosure for thousands of homeowners.

Loan Modifications – the first step breaks hearts. What’s the sad first step toward loan modification? Find out here.

Do they care? Bank Says “Too bad” about failed Loan Modifications

Failed loan modifications – 3 stories and a warning

Beware of Loan Modification Scamsdon’t give your money to these people

The Problem With Banks

A Zombie Foreclosure could keep you in limbo for years. See how banks are preventing homeowners from moving on.

Bank employees follow written guidelines, so… For Bank’s Short Sale Negotiators, Common Sense is not a requirement

Why are banks so often uncooperative? Are the Banks Negligent, Indifferent, or Inefficient?

Every short sale is different – because every homeowner’s situation is different.

 

To get answers specific to YOUR situation, click here.

 

We’ll be glad to provide the answers that will help you make an informed decision about your future.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Residential Real Estate Investment Calculator

Thinking of investing in San Diego residential income property?

See if the investment is a good one by calculating the returns.

Simply enter your information into the residential real estate investment calculator below, then click “analyze.”

You’ll be taken to an analysis showing:

  • Capitalization Rate
  • Cash on Cash Return
  • Loan to Value
  • Debt Coverage Ratio
  • Operating Expense Ratio
  • Net Income Multiplier
  • Annual Cash Flow
  • …and more

New to residential real estate investment and not sure about the terminology?

Visit our real estate investment terminology page.

To learn more about San Diego residential real estate investment opportunities, visit our investor Buyer page and our Global Investment page.

And when you’re ready to start the search, get in touch. We’ll be glad to introduce you to San Diego’s current real estate investment properties.

You can reach us by calling 619-929-1413 or writing td@tomdunlap.com.

Calculator supplied courtesy of REWISE.com

Real Estate Investment Terminology

If you’ve just decided to begin investing in San Diego residential real estate investment properties, you may not yet be familiar with all of the terms you’ll hear. This short list should bring you up to speed:

LOAN TO VALUE (LTV): The loan amount divided by the price, expressed as a percentage. For instance, if you’re purchasing a $200,000 property and your loan will be $150,000 your LTV will be:
150,000 divided by 200,000 = 0.75 or 75%

The lower the LTV, the better rate you’ll get on a purchase loan. It’s the loan amount as it bears to the whole value. $80,000 loan on a $100,000 would be an 80 LTV.


NET OPERATING INCOME: This is the income received from rents after all operating expenses have been deducted. Operating expenses include repairs and maintenance, insurance, management fees, utilities, supplies, and property taxes. Operating expenses do not include principal and interest, capital expenditures, depreciation, income taxes, and amortization of loan points.
The net operating income is used in determining the cap rate and the debt coverage ratio.


CAP RATE, also called RATE OF RETURN: This is the ratio of net operating income divided by the purchase price, expressed as a percentage. The higher the cap rate, the better, because it indicates a larger rental income. A cap rate of 6% is a good starting point for an investor.
For example, a property purchased for $200,000 yields $18,200 net income per year.

$18,200 divided by $200,000 = 0.09. Thus the cap rate is 9%. You want higher cap rates as an investor.


DEBT SERVICE: The yearly sum of your monthly principal and interest payments, and any fees associated therewith.


DEBT COVERAGE RATIO: If you’re financing your San Diego residential income property, the bank will want to see that your incoming rents will cover your outgoing debt service. To arrive at this figure, divide the annual net operating income by the debt service.

For instance, if your net operating income is $50,000 and your annual debt service is $40,000, you’d divide $50,000 by $40,000. The resulting 1.25 is your debt coverage ratio.


GROSS SCHEDULED INCOME (GSI): The maximum rents that will be received if your San Diego rental income property is fully rented for the entire year. Since vacancies do occur, and you may be able to increase rents, actual income may be different.


GROSS RENT MULTIPLIER (GRM): This is the price divided by the income. This is typically determined by examining comparable properties in the marketplace.



PASSIVE (OR ACTIVE) INVESTOR:
A passive investor is a non-real estate professional or a real estate investment portfolio investor. An active investor has a “hands on,” decision-making position in his or her investments.


DEPRECIATION – ALSO CALLED COST RECOVERY: Residential improvements (buildings) can be depreciated over 27.5 years. Provide your tax adviser with all financial documents related to the purchase of your residential income property, including a break-out of the values of the land and the improvements.

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Is it time for you to invest in San Diego residential income property?

Whether you’re a domestic or international investor, we think the answer is “Yes.”

You can reach us by calling 619-929-1413 or writing td@tomdunlap.com.

P.S. If you’re thinking of a property and want to see how the numbers play out, use our San Diego residential real estate investment calculator.

The Importance of a Reasonable Purchase Offer

Right now in San Diego we’re experiencing a shortage of homes for sale. When the market is balanced, we have 6 months worth of inventory. As we go into 2017, we have just over 2 months worth of inventory. As a result, buyers are competing for every correctly priced home.

Most San Diego homes are priced at – or even below – the price at which they will sell. So buyers who come in hoping for a large discount are asking for disappointment.

Sellers don’t have to entertain low offers, so if they feel an offer is unreasonable, they won’t counter. They’ll just accept another offer or counter to the buyer who made a reasonable offer. The unreasonable offer will be marked “rejected.”

Next, a low offer could alienate the sellers so much that they won’t counter even if there’s only been one offer.

Remember that for a person who has lived in a home, emotions play a significant role in the decision-making process.

Listing agents always advise sellers to view the sale of their home as a business transaction. But it is difficult for most, especially if they’ve lived in the home for many years.

How can you come up with a reasonable offer on a San Diego home?

Trust your buyers’ agent. He or she has a finger on the pulse of San Diego real estate – and knows when a house is or isn’t priced at market value.

Your home buying decision should be based on finding a house in your financial “comfort zone” that will feel like home. When you find one that says “I’m your new home, you must live here,” don’t play games with the price you offer. If you do, someone else will soon be living in “your” home.

When you’re ready to find your new San Diego home, get in touch.

Our experienced San Diego buyer’s agents will not only speed up the process by narrowing your search to homes that fit your wants and needs, they’ll help you determine an offering price that will help you own the home you choose.

You can reach us by writing td@tomdunlap.com or by calling 619-929-1413.

Before You Leave the House to View San Diego Homes for Sale, Get Prepared

You’ve been pre-approved for a mortgage loan, you’ve chosen an agent, your agent has helped you narrow the search, and now it’s time to get in the car and see those San Diego homes in person.

This is fun and exciting, but can also be confusing and exhausting if you’re not prepared. Happily, being prepared isn’t difficult.

Here’s the short list:

  • Wear comfortable clothing and shoes.
  • Take along property flyers and a clipboard.
  • Focus your time and attention on the search.
  • Be prepared to act if you find the home you want.

The clothing: Yes, you do like to look nice, but go for comfort as well. Getting in and out of the car and walking around can make you tired and cranky if your clothes or shoes are pinching.

The flyers and clipboard:
If you see more than 2 San Diego homes in a day, it’s easy to get their various features and benefits confused. So take along the flyers and make your own notes as you view the homes. The clipboard will make it easier to keep things together and give you a writing surface.

Plan to focus: When you’re making a major life decision, it’s best to give it your full attention. So set aside enough uninterrupted time to really see the homes you’re viewing.

This is not the time to be distracted by cell phones, nor to need to rush in order to make it to an appointment. And if you have children, carefully consider whether or not they should accompany you as you view homes.

Some children will enjoy the San Diego home search and be helpful as you make your determinations – and others won’t. Only you know how your own children will react.

If they’re going to love the adventure and help you focus on the benefits and features of each home, by all means bring them along.

If they’re going to be tired, cranky, and anxious to go home, don’t make them come along. You won’t be able to focus on the homes if you’re focused on the kids.

Be prepared to act: The San Diego housing market is low on inventory and we’re seeing the most desirable homes moving quickly from “for sale” to “sold.” So when you find the home you know you want, don’t hesitate. Take the time to make the offer before you return home.

Are you ready?

Our buyers’ agents are ready. So get in touch. You can reach us at 619-929-1413 or by writing td@tomdunlap.com.

Searching for a San Diego Home

When you begin the search for your San Diego home you’ll see more homes for sale than you could possibly view, even though the inventory is low. Your first task, then, is to narrow the search.

First, settle on a price range.

When you meet with a lender to become pre-approved for a home loan, you’ll learn the maximum you can spend. But do listen to your own instincts as well. You may not want to “spend all you can” on your monthly mortgage payment.

Choose the monthly payment that you know will fit comfortably into your budget, then ask your lender to work backwards and tell you your maximum loan amount.

Next, consider where you want to live.

Which San Diego neighborhood will be most convenient to work, school, family and/or recreation – and which will enhance your own lifestyle? Come, explore the differences between the neighborhoods and what each has to offer in terms of lifestyle and convenience.

Of course these aren’t all the San Diego neighborhoods you have to choose from. Describe your perfect neighborhood to your buyer’s agent and he or she will help you focus on areas where you’ll be happy.

Start the search in those neighborhoods.

Now – what you want vs. what you need.

Start with what you absolutely must have. This generally includes the number of bedrooms and baths, but you may have other requirements. You might need a master bedroom and the laundry room on ground level. You may have a grand piano or other large furniture that requires an over-sized room. Maybe a home office is a feature you can’t do without.

Whatever it is – whether it affects the interior or exterior of the home – make a list of these important features.

This will help your buyer’s agent narrow the search to homes that meet the basic requirements.

Now comes the fun part – making a list of features you’d like to have.

What would please you and make a house seem extra-special?

  • Walk-in closets?
  • Bay windows?
  • Cathedral ceilings?
  • A huge pantry?
  • A 4-car garage?

Share that list with your buyer’s agent as well. It will help focus your search on those houses you’re most apt to love.

Be prepared for your list to change as you view homes. You may see other features that grab your attention and cause you to alter your goals. Sometimes buyers even change their minds about the “must have” items if a house without one of them speaks to their emotions.

And that’s OK. Your list is not carved in stone. It’s merely a good starting point that will save you time in your search for the perfect San Diego home.

Let the San Diego Pro Team help you find the perfect home…Call 619-929-1413 or write td@tomdunlap.com.

Why Do I Need My Own Agent?

What are the advantages to having your own agent over working with the seller’s agent as you search for your San Diego home?


 

Finding your new San Diego home:

  • Your agent will search the entire marketplace for homes that fit your wants and needs. Because your agent will have seen many of the homes in person and will have access to detailed Multiple Listing information, he or she will be able to narrow the search, saving you time.
  • Without your own agent, you’ll be following ads for homes that may or may not suit you. Then you’ll be shown the homes by seller’s agents who will naturally attempt to keep you focused on their own listings. Given the fact that major real estate portals are now allowing postings from non-agents, you may also be following ads for homes that have already been sold.
  • Your agent will schedule the showings, setting appointments that will allow you to see 2 or more homes on the same day.
  • Without an agent working on your behalf, you’ll be setting individual appointments that may or may not coordinate to let you see more than one home on a given day.
  • If “your home” is not among those currently on the market, your agent will keep you informed of all new listings that meet your requirements. You won’t miss the home you want because you didn’t happen to catch the ad in time.

Confidentiality

  • Your agent will be working for you – keeping your personal information confidential and not revealing anything that would weaken your negotiating position.
  • The listing agent works for the seller, and is legally bound to share anything you say with the seller.

Presenting an offer…

  • Your agent will help you determine the fair market value of any home you’re interested in. He or she will then assist you in presenting a fair and reasonable offer.
  • The listing agent will always suggest a full price (or higher) offer.

Negotiating

  • Your agent will negotiate on your behalf – helping you obtain the best price and terms for your new San Diego home.
  • The listing agent will convey your offer to the seller, but will negotiate with you on behalf of the seller.

Ongoing support…

Once you’ve gotten an offer accepted, your agent will assist you with setting up inspections, and will once again negotiate on your behalf if inspection results make it necessary.

To sum it up, when you have your own agent you have an experienced real estate professional on your team – working for you and you alone from the first showing through the closing.

When you’re ready to begin your search for a home in San Diego or anywhere in San Diego County, get in touch. You can count on the San Diego Pro Team to first listen carefully to your wants and needs – and then to help you save time and money.

You can call 619-929-1413 or write td@tomdunlap.com.

What’s the difference between “prequalified” and “Pre-approved?”

San Diego home buyers understandably get these two terms confused, but there is a great difference.

Anyone can become prequalified over the phone, with no documentation. You simply tell the mortgage lender about your situation and he or she says “I think you can” or “I don’t think you can.” The lender might also give you an estimate of how much you can afford to pay for a home, but it is not a guarantee of a loan.

Pre-approval comes only after the lender has verified the information you provide and checked your credit report. Your pre-approval letter IS a guarantee that unless things change, you will be given a loan for up to a specified amount.

That “unless things change” disclaimer is the reason why your buyer’s agent will advise against doing anything to change your financial picture once you’ve been approved.

That includes making purchases on credit cards, letting any vendor check your credit report, failing to pay a bill on time, changing employment, or withdrawing funds from your savings account.

Don’t even pay off an old account without first getting advice from your lender.

Do you need a San Diego mortgage lender?

Yes, a local lender will be far more responsive to your needs than any Internet lender.

If you’re ready to begin your San Diego home search and don’t have a mortgage lender, get in touch. We’ll be happy to provide you with a list of local lenders who have served our clients well.

And then – we’ll be pleased to help you locate and purchase that new San Diego home!

You can reach us by phone at 619-929-1413 or write us at td@tomdunlap.com.

Become pre-approved for a mortgage loan before beginning your San Diego home search.

You’ve probably heard this many times: Get pre-approved first, then begin the search for your San Diego home.

Why? For several reasons.

First, you’ll learn just how much you can spend on your new San Diego home. Events over the past few years have changed the landscape when it comes to lending. They’ve even affected credit scores for consumers with perfect credit histories. Becoming pre-approved will show you where you stand.

Next, you’ll learn about different loan programs. You may choose one over another, and that one may come with requirements affecting the home you choose. FHA and VA, for instance, have some specific guidelines.

But perhaps most important of all: When you’re pre-approved for a loan, your offer is more likely to be accepted.

Sellers want to know that if they take their home off the market pending a closing, that closing is probably going to happen. A letter of pre-approval gives them that confidence.

If you’re planning to buy a short sale or a foreclosure, becoming pre-approved is mandatory. The asset managers who handle short sale and foreclosure properties won’t even consider approving your offer until you’ve shown that you can complete the purchase.

And speaking of confidence – local lenders inspire more confidence in sellers than “Internet lenders” and will be likely to give you better service.

If you don’t already have a trusted mortgage lender, get in touch and we’ll provide you with a list of lenders who have served our clients well.

Just call 619-929-1413 or write td@tomdunlap.com.

Call us! We’re always glad to help.

How a ½% rise in interest rates will affect your buying power

Will a 1/2% increase in mortgage interest rates determine which San Diego home you purchase?


Depending upon your finances, it certainly could.

As an example, let’s assume that you’re purchasing a home and after you’ve made the down payment; your loan balance will be an even $100,000.

If your interest rate is 4%, your monthly payment for principle and interest on a 30 year mortgage will be $477.42.

Should the rate rise to 4.5%, the payment will go to $506.69. That’s a difference of $29.27 per month – per $100,000 of your loan balance.

Translating that to a price you’re more likely to pay for a home in San Diego, $400,000 at 4% = $1,909.66 per month, while 4.5% = $2,026.74 – for a difference of 4 X $29.72 or $117.08.

Now let’s assume that your lender has looked at your other obligations and said that $1,910 is the most you can pay for principle and interest.

Working backwards, we now find that your loan amount can’t exceed $376,896. In other words, the price of the home you wanted would have to drop by just over $23,000, or about 6%. Of course, you could add the $23,000 to your down payment.

We’ll be happy to help you find the home that fits your budget, regardless of the prevailing interest rate.

So if you want to own a home anywhere in San Diego County, simply call 619-929-1413 or write td@tomdunlap.com.

Tom Dunlap

Tom Dunlap
Broker Associate
TomDunlap.com
BRE# 01713621

Phone: 619-929-1413
Fax: (619) 393-0200
Email: Contact Form

There is no substitute for skill, polished by years of experience, plus a thorough knowledge of the local market. And that’s exactly what San Diego real estate professional Tom Dunlap offers to his clients.

As Broker Associate and team leader, Tom’s association with real estate goes far beyond helping clients achieve their goals; he’s been active in buying, remodeling, and selling his own properties for over 25 years. And, as a true advocate of “America’s Finest City” and San Diego County as a whole, he makes it his business to know what the San Diego real estate market is doing at all times.

Much to his clients’ and associates’ benefit, he freely shares this knowledge.

An attorney in his home state of Texas, before he decided to pursue a career in real estate, he uses his legal background to analyze every angle and be ready for any issues that may come up during a transaction. Because he understands the legal process, he guides clients smoothly through complicated transactions, including those involving probate, trusts, and guardianships.

Tom is is a seasoned negotiator from a variety of perspectives. With a hand-chosen team, expensive but effective software, and ongoing continuing education, he has created a true turnkey process, managed by specialists at each step of the way. All stay up to date on the best and latest methods and market trends in each specific area.

A full-time, full-service agent, Tom has successfully weathered the ups and downs of the San Diego residential and income property real estate markets for over 25 years. He knows how to read the market, make adjustments, and continue getting his clients’ listings sold for the most money in the shortest amount of time.

Tom’s success gives truth to the old saying: “If you want something done right, ask a busy person.” He holds Top Producer status at Ascent Real Estate, often coming in at #1 among Ascent’s 175+ agents.

What do his clients and peers have to say?

“Dependable, accessible, responsive, and detail-oriented” are adjectives both clients and peers use to describe him. He’s also known for cool-headedness in the midst of the sometimes emotionally charged buying and selling process. One client referred to Tom as the “Calm during the storm.”

When Tom left his Texas law practice to pursue a career in real estate, his passion made him an immediate success. He sees this success as a direct result of his fondness for working with people and his dedication to helping his clients accomplish their goals.

 

When you want skill, experience, and knowledge on your side,
call on Tom Dunlap
.

Bank Says “Too bad” about failed Loan Modifications

In an article in the Minneapolis Star Tribune, writer Chris Serres blasted the banks for luring people into believing they’ll get help, when help is far from what they’ll get.

Here are excerpts from that article: 



”A spokesman for J.P. Morgan Chase said the risks are disclosed to homeowners. Under the trial modification signed by homeowners, J.P. Morgan reserves the right to terminate the plan at any point and begin foreclosure. The bank also reserves the right to determine the final amounts of unpaid interest and any other delinquent amounts.”

“We work with customers to try to keep them in the home whenever possible,” said Thomas Kelly, a bank spokesman. “And the HAMP documents clearly explain the steps along the way.”

In other words, the banks are saying that homeowners “know the risks,” so if they’re deep in debt and lose their homes after a loan modification fails, its their own fault.

The lesson: Before you sign anything, read each document carefully. If the paperwork contains even one sentence that you don’t understand, have a qualified real estate attorney review the paperwork before you sign.

If you’re now attempting a loan modification and being put through a wringer, call us at 619-929-1413 or write td@tomdunlap.com. We can offer you insight as to your chances of success, and what to do next to avoid foreclosure.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Is a Deed-in-lieu safer or better than allowing a foreclosure?

Is a deed-in-lieu better than a foreclosure?

In a word, no. So what’s the difference?

In terms of your credit, there is no difference between a deed-in-lieu and a foreclosure. A deed-in-lieu merely saves the lender from spending the time and money to go through the foreclosure process.

The only difference to you is that you’ll probably know a definite date when you need to be out of the house – and you’ll probably need to be out sooner. With a foreclosure, your move-out date could be delayed for up to a year.

Meanwhile, under today’s guidelines, a foreclosure or deed in lieu will probably require 7+ years of good credit before buying a next home.

In addition, under California law, if you have a second mortgage that was not a “purchase money mortgage” the lender can come back on you for a deficiency after either a foreclosure or a deed-in-lieu. The only way to avoid that risk is through the short sale of your home.

The strange thing is, even though it’s more convenient, cheaper, and less time-consuming for the bank, you might not even be allowed to sign a deed in lieu. In order to be considered, you’ll have to fill out an application. And if you have two loans, you’ll probably be denied unless the same investor (not the same servicing company) owns both notes.

So… Is a deed-in-lieu better than a foreclosure?

Our answer is: “Don’t even consider it.” There simply is no benefit to the homeowner.

What about the January 2013 announcement from Fannie Mae?

In 2013 Fannie Mae announced that they’ll allow on-time borrowers to wipe out their mortgage debt through a new “mortgage release” program. This program is simply the re-naming of the deed-in-lieu process. And while it may be of benefit to homeowners in other states, it’s not a benefit to California homeowners. Here’s why.

Every situation is different. If you’d like specific answers that relate to your situation, call 619-929-1413 or write td@tomdunlap.com. We’ll be happy to analyze situation and provide the answers you need before making a decision that will affect your future.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

How a Short Sale Will Affect Your Ability to Buy Another Home

Many San Diego homeowners have worked hard to preserve good credit. Some come to us with a pristine credit record, yet are saddled with debt – most of which they have incurred in order to keep current on mortgage payments. The conclusion that they need to offer their house as a short sale is a very heavy one to reach for any homeowner. And, for some, the idea of foreclosure seems painless and quick under the circumstances.

The real fact is that a lender will not like seeing either on your credit. AND, the very real fact is that you can recover your credit within 24 – 36 months after the short sale of your house while 60 months is the minimum after a foreclosure.

There are about as many opinions as people writing or speaking on this topic. The real answer is that no one really knows how a short sale will affect your credit scores.

I hear REALTORS® saying without a doubt… a short sale and a foreclosure are completely different. Then, I hear bankers and mortgage brokers saying that default is default… don’t do it. The truth is, both sides of the coin are right. What the mortgage or loan officer fails to realize is that anyone asking that question is very likely without a BETTER alternative.

Only the people at Fair Isaac, the FICO people, really know what each item does to the math on your credit score. And there are many factors that go into the mix. In addition, since each person has a different credit history, the short sale of a home will affect different people in different ways.

Let’s assume that it is you asking the question. You’re paying the bills on time, but paying off the mortgage is not an option for you. Let’s say you are either in default or headed into default OR that you have decided to keep paying the note on the asset that has lost a large chunk of value.

Let’s assume that you are thinking about the credit risk of foreclosure versus a short sale.

We know that a default is a default. And you will probably never get through a short sale UNTIL you are in default. If you are paying the bills, the lender assumes that you must have some means to do so, somewhere.

So, if you want to Buy a Home After a Short Sale…

A foreclosure will remain on your credit report in the public records section for 10 years. In addition, you will need to answer these questions on any loan application:

  • Have you ever had property foreclosed upon or given title or deed in lieu thereof?
  • Have you directly or indirectly been obligated on any loan which resulted in foreclosure, transfer of title in lieu of foreclosure, or judgment?

There is no such question for short sales.

Again, the real fact is that a lender will not like seeing either a short sale or foreclosure on your credit. But the second very real fact is that you can recover your credit with 24 – 36 months after the short sale of a home while 60 months is the minimum after a foreclosure.

If you’re ready to short sell your house, or simply have questions related to short sales, call 619-929-1413 or write td@tomdunlap.com.

We have a track record of 98% success in selling and closing the short sales we list – and we’ve helped hundreds of San Diego homeowners just like you avoid foreclosure and get on with life.

We’ll be happy to explain the process and answer all your questions.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Don’t use your Visa to make your San Diego home mortgage payment!

Holding on to your home is an honorable goal, but going deep into credit card debt to do so is a sure path to economic ruin.

Your credit cards will only go so far, and then what? You could lose the house to foreclosure and be left with a huge high-interest unsecured debt.

Don’t wait and let the situation get worse.

If you wait, the financial fallout can be even more dire…

If you are in financial trouble or think you may be headed that way, consider getting out from under that house debt through a short sale. Under California law, the banks that own your home loan or loans cannot come back to you for the deficiency if you sell. If you allow the house to go into foreclosure, your second lien holder can sue you and obtain a deficiency judgment.

Meanwhile, if you’ve run up credit card debt that you can’t or don’t want to pay, the credit card companies can also sue and obtain judgments.

The only way out of those judgments is to pay them or file for bankruptcy.

Once you’ve listed your home as a short sale with an experienced San Diego short sale agent, you can stop making those payments – giving yourself space to breathe and to accumulate some funds.

Experienced is the key word. Don’t list with an agent who lacks the experience and expertise to not only find a buyer but to negotiate with the banks to bring your short sale to a closing. This is the time to enlist the aid of short sale specialist.

The economy is still in an unsettled state, being buffeted by forces neither you nor we can control. So conserve your cash and make decisions that will aid in your long term financial health.

To learn more about San Diego short sales and how a short sale will affect you, call 619-929-1413 or write td@tomdunlap.com for personalized answers to your short sale questions.

We’ve helped hundreds of San Diego homeowners avoid foreclosure and have a track record of 98% success in selling and closing our short sale listings.

Every situation is different, so use this opportunity to get specific answers for your specific situation.

Call today. We’re here to help.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What hardship prevents you from making mortgage loan payments?

Before the bank will consider your San Diego short sale you’ll need to show that you’ve suffered a hardship. Thus, short sale hardship letters are a necessary component of a short sale request package.

Does your hardship qualify? Unless you clearly demonstrate a hardship, the bank will assume that you do have the ability to continue making payments, and your short sale request will be denied.

What constitutes a hardship?

A change in circumstance that affects your financial state. For instance:
• Death of a spouse/partner who contributed to the mortgage payments
• Illness that has prevented a person from working
• Layoff
• Divorce
• Change in loan payment due to an Adjustable Rate Mortgage (ARM)

Short sale hardship letters, which explain what has changed and why, are submitted along with financial information such as tax returns, pay stubs, bank statements, and a run-down of monthly expenses.

Have you suffered a qualifying hardship?

If you need help deciding whether your situation qualifies as a hardship for a short sale in San Diego, call 619-929-1413 or write td@tomdunlap.com.

Because we’ve helped hundreds of homeowners successfully sell their homes, we have become well acquainted with each bank’s preferences. We know what needs to be included in short sale hardship letters – and how to say it. We’d be pleased to share that information.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Want the bank to agree to a short sale of your home? You’ll probably need to stop making payments.

San Diego homeowners who have been trying to preserve their credit rating but need to short sell are often dismayed to learn that they’ll probably need to stop making their mortgage payments in order to be considered for a short sale.

This is because the bank wants to see that continuing to make payments is a hardship. If you continue to make payments, no matter how far you’re going into debt to do so, they can’t see the hardship.

Once you stop making payments, you’ll get the attention of the analysts, negotiators and investors at your lending institution(s).

However, this is not the end of the world. If your other payments are up to date and you manage your money carefully, your credit scores will begin to improve as soon as the short sale of your home is final. In as little as 2 years you could be eligible for another home mortgage.

The thing to remember is:Every short sale situation is different. If you’d like specific answers that relate to your situation,call 619-929-1413 or write td@tomdunlap.com to ask questions and get answers that relate to your specific situation.

You may even be able to get the short sale of your home approved with all payments current. This largely depends on your lender and how much weight they give to short sale hardship letters. Each asset manager and each homeowner’s situation is different.

If you need help figuring out if you should stop paying your mortgage so you can do a short sale in San Diego, please don’t hesitate to contact us. We’ve studied each bank’s guidelines, know what carries weight for them in short sale hardship letters, and have developed a working relationship with most bank negotiators – so we can guide you in making that decision.

If you’d like to talk it over, call 619-929-1413 or write td@tomdunlap.com.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

The Value of Persistence in a San Diego Short Sale

Robert Ringer, former real estate agent and best-selling author of “To Be Or Not To Be Intimidated,” and “Looking Out for #1,” writes a lot about success. One of his consistent themes is the necessity for persistence.

In one book he tells the story of dealing with call centers. In one instance he wanted to change his account information with a phone company. The representative told him he’d need to print a form, sign it in front of a notary, and mail it in.

But he didn’t want to go through all that, so he hung up and re-dialed. The next representative changed the information in the company computer system and he was done.

Another time he wanted to buy a product in bulk for a certain price. The representative said no, that couldn’t be done. So, once again he hung up and re-dialed.

The next person he talked to agreed to sell him the product in bulk for the price he wanted. He got what he wanted a lot faster and easier than if he had spent time arguing with the first person.

So what does succeeding with call centers have to do with closing San Diego short sales? Both require persistence.

Negotiating the successful short sale of any home begins with having the expertise to properly prepare both the paperwork and the argument in favor of the short sale. It requires having the facts to back the argument, and the persistence to make sure those facts are heard and understood. If the first person we talk with isn’t willing to listen or cooperate, we ask someone else.

Success also requires unrelenting follow-up, so that our clients’ files don’t get shoved aside or forgotten. This persistence increases our odds of success – and it’s a procedure that inexperienced agents don’t even realize they need to use.

When we list your San Diego area house as a short sale, our goal is to help you wipe out the upside down debt and remove the threat of foreclosure. We also want to keep you in a position to get a new mortgage loan in two years rather than the 7 to 8 years you’ll have to wait if your home goes to foreclosure.

Success in those goals requires the kind of persistence that refuses to take no for an answer. And that’s just the kind of persistence that we’ll use on your behalf.

If you are considering the short sale of a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego, call the team that doesn’t give up.

To get your questions answered quickly, call 619-929-1413 or write td@tomdunlap.com. We’ll be happy to explain the real estate short sale process and answer any questions you might have about the possible short sale of your San Diego area home.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

For Bank’s Short Sale Negotiators, Common Sense is not a requirement

San Diego real estate agents – and agents across the nation – have a hard time understanding the actions of bank’s short sale negotiators. Often, their decisions and demands are completely lacking in common sense.

A conversation that was related to me by another San Diego real estate agent illustrates the kind of thinking that makes us wonder about their real objectives. Here’s how it went:

Bank’s short sale negotiator:
“I can’t process this short sale without the TPG form filled out with the seller’s full name.”

Agent: “Based on my calculations, this short sale will help your company avoid a $17,000 loss, but you’re telling me that unless I can get you a corrected TPG form, you’ll reject the short sale of this home and subject your company to a potential $17,000 loss.”

Negotiator: “That’s right.”

Agent: “But $17,000 is a lot of money. Don’t you agree?”

Negotiator:
“I don’t care about the money. The TPG form is company procedure.”

You’d think there was a serious mistake, wouldn’t you? But no, that wasn’t the case. And the negotiator was the only one with a problem. The Title company and the buyer’s lender were completely OK with the paperwork as it was.

The problem was a discrepancy in the seller’s name. His full legal name was something like “John W. Doe II.” But one form had “John Doe” entered for the seller’s name. The short sale negotiator was going to reject the short sale of this home unless his name on that form was changed to “John W. Doe II.”

She was willing to subject her investor and/or the banks’ shareholders to a minimum $17,000 loss because she wanted a different piece of paper.

You know that no business person dealing with their own money would take that attitude. But the short sale negotiator wasn’t dealing with her own money. So all she cared about were the procedures and the forms. Common sense didn’t enter the picture at all.

The result of this kind of nonsense is that many banks turn down short sales only to lose more money through a foreclosure.

Had this agent been unable to secure the required form, the house would have gone into foreclosure within 6 months. By then, due to the rate at which market values were falling at the time, it would have lost $13,500 in value by the time of the foreclosure. By the time it went through the foreclosure listing process, it would have lost another $7,000 to $14,000.

But the bank’s negotiator was willing to take that loss unless the form was filled out correctly and re-submitted.

If you were a stockholder in that bank, would you have approved?

This scenario leads us to 2 conclusions:

  • First, the banks need to train their negotiators in the art of using common sense and looking at the bottom line.
  • Second, agents who represent sellers in short sales need to learn how to “head these problems off at the pass.”

Short sale request packages need to be submitted in the manner that pleases the bank. And each bank has a different way of being pleased. Short sale agents need to do their homework.

In addition, agents need to check and double-check the forms before submission. A name discrepancy is minor, but in this case, it nearly put the seller in foreclosure.

Our careful attention to detail and knowledge of what each bank wants is one of the reasons that in nine years of dealing with short sales, we’ve been successful 98% of the time.

So if you need to short sell your house in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego, call 619-929-1413 or write td@tomdunlap.com.

We’ll be happy to meet with you to explain the real estate short sale process and answer any questions you might have.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

If I don’t have to pay income tax on my forgiven mortgage debt, why did I get a 1099 form?

If I don’t have to pay income tax on my forgiven San Diego home mortgage debt, why did I get a “Debt forgiveness” 1099 form?

We are not tax professionals and cannot give tax advice, but we can tell you the short answer: Because the IRS requires it.

Most San Diego homeowners know that under the terms of the Mortgage Forgiveness Debt Relief Act of 2007, homeowners are not required to pay income tax on forgiven debt if that debt was incurred for the purchase or improvement of a qualified principal residence. This Act  was extended through December 31, 2016, and hopefully it will be extended again.

So it’s natural for those who have gone through foreclosure or had debt forgiven through a short sale to wonder why they received a debt forgiveness 1099 form, and why, on page 11 of IRS publication 4681, it states: “The lender must file form 1099-C and send you a copy if the amount of debt canceled is $600 or more and the lender is a financial institution, credit union, federal government agency, or any organization that has a significant trade or business of lending money.”

The publication doesn’t actually state why, but we can assume the reason to be verification of “bad debt” deductions on the part of the lender. Remember that your lender is allowed to reduce its taxable income by the amount of debt forgiven.

Publication 4681 gives examples and shows how to report the debt forgiveness 1099 on your taxes, then how to use form 982 to show that you aren’t liable for tax on the forgiven amount.

Do note that The Mortgage Forgiveness Debt Relief Act of 2007 only removes tax liability from indebtedness directly related to the purchase or improvement of your home. You will still be liable for debt on a second mortgage or home equity line of credit used to pay off other debt, purchase a car, take a trip, etc.

However, you may still be exempt from income tax on forgiveness of that debt. If you have forgiven debt related to a second mortgage or a home equity line of credit, and if you were “insolvent” at the time the debt was forgiven, you won’t be required to include it in your income. Pages 4 and 5 of publication 4681 explain how to determine insolvency and page 6 offers a worksheet.

Do consult with a tax adviser before assuming that you owe or don’t owe.

If you have questions about how the laws affect you, call 619-929-1413 or write td@tomdunlap.com. We’ll be glad to assess your situation and put you in touch with tax advisers who can help protect your financial future.

This information is not to be taken as tax advice. We are not tax professionals are we are not familiar with the intricacies of tax law.

Please read IRS Publication 4681 and consult your CPA or tax preparation professional for advice.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

In San Diego Short Sales, Knowledge is Power

Sometimes you have to wonder if the bank negotiators even know their own investor’s guidelines. And if they do know the guidelines, why they put roadblocks in front of San Diego residents trying to short sale their homes.

Each investor does have their own guidelines for short sales, which is why a short sale agent’s first step in preparing a short sale package is learning who owns the loan. The next step is knowing that investor’s guidelines.

If the agent doesn’t have that information, an uncooperative short sale negotiator can “run a bluff” or tell an outright lie, and the San Diego short sale agent won’t know the difference.

When it comes to short sales, our knowledge is your power. Call 619-929-1413 or write td@tomdunlap.com to tell us your situation and get the answers you seek.

A short sale saved by knowledge…

Not long ago we closed a Kensington short sale owned by Fannie Mae. The bank’s appraiser said this San Diego area home was worth $620,000.

Because we’ve closed short sales on Fannie Mae owned homes in San Diego many times, we knew their guidelines and what they would accept as a percentage of that value.

But, when we presented an offer for $6,000 more than the price we knew was acceptable under those guidelines, the short sale negotiator countered the offer. She said the investor would not go that low and buyers must pay more. They had seen other homes they liked and in fact had a “fall back” home in mind if the bank refused this offer. They weren’t going to pay more.

Because we knew this was an acceptable offer, we were able to persuade the negotiator to accept the offer as it was presented. Had we not known the Fannie Mae guidelines, this sale would have fallen through and the home would have become yet another San Diego foreclosure.

Knowledge is one of the reasons why after 9 years of negotiating San Diego area short sales, we have a 98% success record in keeping homeowners out of foreclosure.

Every short sale situation is different. If you’d like specific answers that relate to your situation, call 619-929-1413 or write td@tomdunlap.com. We’ll be happy to answer your questions and to explain the short sale process.

If you’re underwater on a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and need to sell, we can help.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Help! I don’t have the money for my San Diego property taxes!

Recently, a Rancho Bernardo homeowner shared his concern about not having the extra money to pay the San Diego County property tax bill that was soon due. He was worried that San Diego County might seize his house for non-payment of property taxes.

He was glad that he took advantage of the opportunity to ask, because we were able to put his mind at rest.

Why you don’t need to panic over the San Diego County property tax bill…

As you probably know, San Diego County property taxes are paid in two installments and are due December 1 and April 1 each year. They become past due 10 days after the due date. At that time, the homeowner is assessed a 10% penalty and a $10 fee.

If the taxes have not been paid by June 30, when the fiscal year ends, the homeowner is charged a $15 redemption fee and the unpaid tax amount will begin to accrue interest.

That’s the bad news. The good news is seizing and selling homes just adds to their workload. They’d much rather give you help in the form of a payment plan. And even if you don’t make payments, your San Diego home won’t be subject to seizure by the county until taxes are 5 years past due.

So even though you don’t want to pay their high interest rate, if you don’t have the funds and don’t know if you’ll keep the house, just wait.

If you’re trying to keep your home and working on a San Diego loan modification, wait to see if it will become final. Once the loan modification is final (NOT in a trial period), then pay the back taxes as soon as you can in order to avoid the interest charges and late fees.

If you’re offering the house as a San Diego short sale, or if you’re letting it go to foreclosure or signing a deed-in-lieu, don’t worry about the property taxes at all. Save your money for moving expenses once the house is sold. The bank will be required to make this payment.

If you’re behind on San Diego home mortgage payments and you’re undecided about what to do… Call us.

We have the same software the bank uses to determine whether your loan modification request will even be considered. This can save you from months of waiting and wondering.

If you’re considering short selling, we’ll be glad to explain the process and answer any questions you might have.

We do strongly recommend that you choose a San Diego short sale over signing a deed-in-lieu of foreclosure or doing nothing and waiting for a foreclosure. Either of those actions will put you at risk of a deficiency judgment if you have a second mortgage or a home equity line of credit. A short sale will prevent that risk.

In addition, a short sale is far less damaging financially, and will put you in a position to own a home again in two years, as opposed to 5 to 8 years with a foreclosure.

No two short sale situations are exactly alike. When you want advice that applies to your specific situation, call 619-929-1413 or write td@tomdunlap.com to request a no-obligation consultation.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

In a San Diego short sale, do I have to know who owns my mortgage loan?

Yes, when making application to short sell your San Diego house, you really do need to know who owns your loan.

Generally, it isn’t the company you pay. Most loans today are sold almost immediately after being granted. In fact, they may be sold 2 or 3 times within the first few weeks or months. Many are sold to Fannie Mae, Freddie Mac, or a Wall Street Firm.

The company you send payments to is simply a subcontractor, hired to collect payments, handle escrows and accounting, and manage their debt collections and foreclosures. These banks are “asset managers” and now, short sale negotiators, for the investors who actually own the loans.

The “Final Rule” amending Regulation Z (Truth in Lending) went into effect on January 1, 2011, and mandated that ownership must be disclosed. All investors acquiring mortgage loans are now required to provide the consumer with the name, address, and telephone number of the new owner, and the transfer date. They’re also required to provide the homeowner with the name, address, and telephone number of the party who is authorized to receive the mortgage loan payments.

However, most homeowners still don’t know who owns their loans – especially if ownership was transferred prior to January 1, 2011. But don’t worry. This is a detail that experienced San Diego Short Sale agents will ferret out for you.

But if I’m asking for approval to short sale my home, why does it matter who owns my loan?

Because knowing which bank or entity actually owns the loan is vital to short sale negotiations.

Each investor has its own guidelines regarding the selling price they’ll accept for a short sale relative to their own appraisals. Experienced short sale negotiators take the time to learn those guidelines so they can negotiate more effectively with the bank’s asset managers.

Successful San Diego short sale agents:

  1. Develop a working relationship with asset managers / short sale negotiators at each of the banks that handle mortgage loan portfolios for investors
  2. Know each investor’s guidelines
  3. Negotiate from a position of knowledge

We’ve kept hundreds of San Diego area homeowners out of foreclosure since this crisis began. We’d like to do the same for you, so if you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and are thinking about a short sale, get in touch.

You have short sale questions; we have answers.


Call 619-929-1413 or write td@tomdunlap.com We’ll be glad to talk with you with no obligation.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Forensic Loan Audits – Do You Need One?

When you see or hear the term “forensic” it is usually in connection with a story or show about criminal activity. They use “forensics” to gain evidence and convict the criminal or to determine how a crime was committed.

One of the definitions of the word is: “Relating to or dealing with the application of scientific knowledge to legal problems.”

We think the word “detailed” might be more appropriate than “scientific” in a Forensic Loan Audit, but the purpose is nearly the same: to gain evidence in order to determine if a crime has taken place.

What is a Forensic Loan Audit?

It is a comprehensive and detailed audit/examination of every document related your mortgage contract – from the good faith estimate all the way through the closing documents and beyond. The audit’s purpose is to determine whether a lender has violated any federal, state, or local laws with regard to a mortgage loan. As he or she reviews the documents, the auditor will be searching for violations.

A forensic loan audit will reveal if there have been violations of the Real Estate Settlement procedures Act (RESPA), the Truth in Lending Act, the Home Owner Equity Protection Act, and others. The auditor will also look for signs of predatory lending, forgery, violations of good faith estimate compliance, and other misrepresentations of any kind.

Following the Forensic Loan Audit the auditor will present his or findings in writing, with an analysis and recommendations for loan modification terms and short sale negotiations.

In cases where fraudulent activity has been discovered, audits have helped homeowners tremendously. Some homeowners have even had their loans forgiven entirely. But these are not the norm.

The reason these cases make the evening news is that they are unusual. Most audits find no evidence of fraud – so don’t spend money on a forensic loan audit in hopes something will pop up. Only order a forensic loan audit if you honestly feel that there is something not quite on the up-and-up about your San Diego home mortgage.

Finding discrepancies may or may not help your cause in negotiating a loan modification or a San Diego short sale. While some bank negotiators might be swayed by the results of an audit, others will simply be annoyed. Often you are more likely to gain their cooperation by allowing us to negotiate without mention of it.

Of course, if your audit turns up solid grounds for legal action against the lender, that’s a different matter. You may not need to worry about the bank’s negotiator. Just be aware that few audits do find errors of that severity.

We’ve been successfully handling San Diego area short sales for 6 years now – and our success record at keeping homeowners out of foreclosure stands at 98%. So if you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and need to sell short, get in touch.

You can reach us by calling 619-929-1413 or writing td@tomdunlap.com.

A word of caution: If you decide to have an audit, do your homework before choosing an auditing firm. Use Google, get references, and proceed with caution. The current economy has spawned a variety of crooks waiting to prey on homeowners who are in distress. Some of those predators call themselves Forensic Loan Auditors.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

San Diego Short Sale Success is Often Determined by the Initial Application

Almost any conversation about real estate these days includes a story or two about a San Diego short sale that drug out for 6, 8, or 12 months before closing. Some stories are even worse – they tell of short sales that were rejected after the bank sat on the paperwork for up to 6 months.

The stories are true, but it isn’t likely to happen that way if the listing agent has both expertise and experience with San Diego short sales.

Sometimes the bank’s asset managers are simply slow or inefficient, but more often the delays and problems can be traced back to the San Diego homeowner and his or her listing agent.

It’s all a matter of procedure – and submitting the request properly the first time.

If you want to gain the asset manager’s cooperation, you submit everything they want in a package with the initial short sale request. That makes the asset manager’s job easier – and when you make anyone’s job easier, you set yourself up for a good working relationship.

If you fail to submit the required paperwork, your request will go to the bottom of the stack, and it could be weeks or even months before you get notification about the missing items. Naturally, the negotiation won’t start until the bank has everything it wants.

Over the past several years,we’ve had a 98% success rate in selling and closing the San Diego short sales we list. One reason for that success is that we’ve taken the time to learn what each of the major banks wants in the initial short sale request package. We make sure it’s all there, with the pages arranged in the specified order. In other words, we set the stage for success with the initial contact.

If you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and are considering a short sale, call 619-929-1413 or write td@tomdunlap.com. We’ll be happy to explain the process and answer your questions – at no obligation, of course.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Can I buy back the house I’m short selling?

Many San Diego homeowners would like to remain in their homes – but with a considerably lower mortgage payment and a smaller loan balance.

Thus the question arises: Can a seller buy back the house he is short selling? The answer is “Probably not.” In fact, most lenders will not allow you to sell to a relative, a close friend, or a business associate.

Most San Diego short sale contracts require both the buyer and the seller to certify that theirs is an “arms length” transaction.

What is an “arms length” transaction?

According to the Dictionary of Banking terms, an “arms length” transaction is: “A transaction carried out by unrelated or unaffiliated parties, as by a willing buyer and a willing seller, each acting in his own self-interest. Pricing based on such transactions is the basis of fair market valuations.”

If you were to purchase the house yourself or to sell it to someone close to you, the bank might assume that they weren’t getting the highest possible price for the house. And of course, the highest possible price is their goal.

However, while we have not witnessed it, we have been told that some banks will approve a non-arms length transaction if it appears to be in the bank’s best interests. Thus, it can’t hurt to ask. Just don’t be surprised when the answer is “no.”

Depending upon your bank and its policies, you may be able to refinance with a principal reduction or to work out a loan modification.

If a loan modification is your choice, do come and see us before making application.

We have the same software that the banks use to determine whether or not you’re qualified – and we can tell you within minutes what it might take weeks or months to learn from the bank. If it does appear that you qualify, we can also give you information on how to present your case in a manner that gives you the best chance of success.

If neither a refinance nor loan modification will work, list your home as a short sale, get it sold, and move on with your life. The sooner you make the decision the sooner you’ll be out from under the burden of high payments. Then, in just 2 or 3 short years, you’ll be eligible to purchase another San Diego home.

If you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego, and want to put it on the market as a San Diego short sale, we can help. We’ll be glad to answer your questions and explain how a short sale is transacted.

We are short sale specialists. We’ve been successfully handling San Diego area short sales for the past 9 years, with a 98% success rate. We’d be pleased to help you too, so feel free to call with any questions.

To reach us, just call 619-929-1413 or write td@tomdunlap.com.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Who decides which short sale offer to accept? The Homeowner.

The Homeowner decides which offer to accept.

Because the seller’s lender has to approve a short sale, many believe that it is the lender who sees all the offers and decides which to accept. That’s not true. It’s just one of the misconceptions that’s been repeated so often that people have come to believe it.

As long as no foreclosure has been finalized, the homeowner still has the right to accept or reject any offer to purchase his or her home. The lender’s asset manager simply approves or rejects that offer after your agent submits it.

It is the San Diego homeowner who chooses the listing agent and sets the listing price, based on advice from his or her short sale listing agent. When the listing agent is experienced in San Diego short sales, that listing price will fall within a range that’s acceptable to the lender.

It is also the homeowner who chooses which offer to submit to their lender for approval.

A San Diego homeowner may reject any offer – for any reason.

San Diego homeowners aren’t obligated to entertain offers far below market value, and can in fact reject an offer simply because the buyer “rubbed them the wrong way.” It is still their house.

Unfortunately, some San Diego home buyers and their agents don’t understand this. Some believe that the homeowner must accept any offer and submit it to the lender.

Most of the time, homeowners have good reasons for rejecting an offer. Those reasons include:

  • Price: Your agent has advised you that the bank won’t approve an offer below a certain number, and this offer is lower.
  • The buyers want expensive repairs – and you don’t plan to spend any more money on the house.
  • The buyers have included excessive contingencies – a sure sign that they’ve probably submitted multiple offers and could decide to walk.
  • The buyers have not gotten a loan pre-approval – so you don’t know that they could actually close.
  • The buyer has not put down enough earnest money to make you feel that he or she is serious and they refuse to increase it.

If you are underwater with a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and are thinking of short selling, get in touch.

You can reach us by calling 619-929-1413 or writing td@tomdunlap.com.

As San Diego Short Sale specialists, we have helped hundreds of homeowners avoid foreclosure over the past 9 years. In fact, we have maintained a 98% success rate in getting our short sales closed.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Beware of Loan Modification Scams

As most San Diego homeowners know, loan modifications did not turn out to be solution that was promised.

A program that was supposed to give aid to more than 3 million troubled homeowners across the U.S. within the first year has instead, after several years, helped only about 600,000 homeowners nationwide.

So, while we know that most loan modifications fail – or end in foreclosure for San Diego homeowners – the slight chance of success gives hope to some who desperately want to keep their homes.

As a result, troubled homeowners have become the latest “easy target” for con artists. These con artists run crooked companies that promise that for an up-front fee, they’ll handle all the paperwork, details, and follow-up – and the homeowner will get a loan modification.

The truth is, many of these companies don’t even attempt to help the homeowners. They simply take the fees, which can range from $750 up to nearly $4,000. Even worse, they advise the homeowners to stop making payments – a move that almost guarantees foreclosure.

Some of these companies have been shut down and fined. Others are still in operation and still fleecing homeowners when they can least afford it.

If you are considering a loan modification on your San Diego home, please realize that you will be your own most effective negotiator. However, there are things you need to know before you start the process. The first is whether your payments, income and assets fall within your bank’s guidelines for loan modification.

If they don’t, the bank will take your application and let you wait for several months before they send you a rejection notice. By then you will have wasted precious months when you might have been considering other alternatives – such as offering your home as a San Diego short sale in order to avoid the stain of foreclosure.

Talk to us first…

Before you apply for a loan modification, call Tom Dunlap and make an appointment to come in and talk. We have obtained the software and the guidelines that will enable us to tell you within minutes whether your San Diego loan modification application will even be considered.

If the answer is yes, we can explain some things that the banks won’t tell you. For instance:
• How to write an effective hardship letter
• The 3 most common loan modification mistakes – and how to avoid them
• What not to do so you don’t risk being carted off to jail
• How to calculate and present your budget properly to increase your chance of success

If the answer is no, We’ll be happy to explain how you can still avoid foreclosure through the short sale of your San Diego home.

And yes, when considering foreclosure versus short sale, a short sale is the far better choice.

Over the past 9 years, Tom has successfully helped hundreds of San Diego area homeowners avoid foreclosure through short sales. In fact, he has a 98% success rate. He can do the same for you – as long as you don’t wait too long to ask for assistance.

So if you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and are contemplating either a loan modification or a short sale,call 619-929-1413 or write td@tomdunlap.com to tell us your situation. We’ll be happy to help you determine whether you’ll be eligible for a loan modification, explain the real estate short sale process, and answer your questions about both the benefits and consequences of a short sale.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Why Won’t My Agent Show Me Short Sale Listings?

More and more San Diego buyers’ agents are steering their buyers away from short sales. One lady who called on us to show her our short sale listings asked why her former agent refused.

With short sales making up a good portion of the inventory, she felt that she was narrowing her choices and probably missing out on some bargains. And of course, she was.

Buyer agents who know short sales are always willing to show our short sale listings.
The first reason many buyer agents steer clients away from short sales is that the client has indicated a need to purchase and close in a short time frame. In that case, the buyer should avoid short sale listings. No matter how skilled the listing agent happens to be, a short sale takes longer than a traditional sale, simply because it requires approval from so many people.

Depending upon the bank’s procedures, an experienced short sale agent can usually gain approval within 30-90 days. With an inexperienced listing agent it could take 6 months or more.

Getting approval from a homeowner can take only a day or two.

Next, the San Diego buyer’s agent in question may have had a bad experience.

She may have submitted a short sale offer on a home listed by an agent who didn’t submit the short sale request properly, or who didn’t follow up. Or, perhaps the listing agent was a poor negotiator. Or, perhaps the buyers’ agent didn’t understand his or her duties in the short sale process.

The number of problems that inexperience can cause are what lead us to say “Always use an experienced short sale agent.”

However, all of us had a first short sale, so we don’t want to bash anyone for jumping into something new. An inexperienced agent can do well if they have an experienced agent as a mentor to give assistance and advice as they go through the process the first few times.

Although no one can predict what the banks will do in each new transaction, we who specialize in San Diego short sales are careful to study each bank’s policies and procedures so that we can price our listings correctly and present an acceptable package the first time. Knowing what each lender wants and expects also enables us to negotiate from a strong position.

If your agent refuses to show you San Diego short sales, ask why. If you have time restraints, then your agent is correct. You should avoid them. But if the reason is your agent’s prior bad experience with short sales, ask him or her to only show you San Diego short sales listed by agents who specialize in short sales and have an outstanding track record for closing.

If you’re a buyer looking for an agent to guide you expertly through a short sale purchase, call 619-929-1413 or write td@tomdunlap.com to tell us your wants and needs. We’ll be pleased to do a search on your behalf.

We specialize in San Diego short sales – and we’ve successfully sold and closed 98% of our listings over the past 9 years.

We’ll be happy to show you our current short sale listings. And if you’re already working with a buyer’s agent, we’ll be pleased to cooperate with that agent to help you own the home of your dreams. Ask your agent to get in touch with us.

If you have questions about the short sale process and how it differs from purchasing a non-distressed San Diego home, please do call us at 619-929-1413 or write td@tomdunlap.com. We’ll be happy to answer your questions.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Can I Ever Own Another Home After a San Diego Short Sale?

Yes, you can own another home after a San Diego short sale. The short sale of your home does not mean becoming a tenant for life.

In fact, with careful money management, you can own another home just 2 or 3 short years after a San Diego short sale.

So that you’ll be ready, use this time to rebuild your credit scores and put some money away for a down payment.

Step #1: Pay down your other bills.

If you have other debts, and especially debts in arrears, start working to get them repaid. A “paid late” notation on your credit report looks better than a write-off or a judgment.

Check to see that you were cleared of all liability for your San Diego home loan when your short sale was finalized. If there’s a “deficiency judgment” against you, contact your lender and attempt to negotiate a pay-off for an amount less than you owe. Quite often, they will.

If Tom Dunlap helped you short sale your house, or if you sold after the new California laws regarding deficiencies went into effect, this should not be an issue.

Step #2: Check your own credit, even if you think you know what the report says

Order a free copy of your credit report from each of the major credit reporting bureaus. The bureaus are: Equifax, Experian, and TransUnion. Pay the extra few dollars to see your credit scores. Do get a report from all 3 bureaus, because they will probably not be exactly alike. Because it does cost money for businesses to report, some report to one bureau and not to the others.

Read the reports carefully to see that everything on them is true. Even the executives at FICO admit that over 70% of all credit reports contain errors. And while some are minor and can be ignored – such as a slight misspelling of your name – some of those errors can be damaging. All it takes is a keystroke error to put someone else’s debt on your credit report.

Watch for signs of identity theft, such as notice that you’re working for a new company, have a different spouse, or live at an address that isn’t yours. If you find such signs, contact the credit bureau and follow their advice.

If you find negative information that’s more than 7 years old, take steps to have it removed. The credit bureaus have forms for this purpose.

Step #3: Work on reestablishing your credit.

Become fanatic about paying every bill on or before the due date. As long as no new negatives are reported, time alone will repair your credit. You want to see those “Paid as agreed” notations on your credit report.

Keep your old credit cards and use them – but sparingly. The longer you’ve had credit with a given card company, the more positive influence it has on your credit scores, so don’t cancel any old cards and don’t stop using them entirely. Charge something every few months, then pay the bill when it arrives.

If you’re carrying credit card balances, work to bring them each down to 30% or less of the credit lines available to you.

Credit issuers like to see that you can handle more than one type of credit. So unless you already have them, apply for a small car loan or other fixed-payment installment loan. If you no longer have a credit card, go on line to research, find one that fits, and make application.

If your credit really suffered before your short sale, you’ll begin getting “bad credit” credit card offers in the mail. Before you choose one be sure to compare offers. There are HUGE differences. Some have initial fees almost equal to the credit lines they offer – and some have interest rates as high as 75%!

Apply for only one card. If you apply for several within a short period, it will signal that you’re desperate for funds and your scores will drop.

Once you have a new credit card, never use more than 30-40% of your credit line and always pay it down below 30% before the next billing cycle.

Step #4: Avoid Scams

Credit repair ads promising to rid your credit report of all negative information are scams. The only thing they’re going to remove is money – from you. In addition they could get you into legal difficulties, because some of the credit repair methods they promote are fraudulent.

What they can, but probably won’t, do is remove outdated or untrue information. And you can do that yourself by contacting the credit bureaus directly.

Legitimate debts, judgments, etc. cannot be removed by any legal means. They will, however, come off over time. You simply need to be patient and work on adding positive information to your credit report while the negative information fades into the past.

You can own another San Diego home. It will just take a little time and some careful money management.

If you aren’t sure whether you’re now qualified to purchase a new San Diego home, get in touch. We’ll be happy to discuss your situation and give you the benefit of our experience.

If you’re still just thinking of offering your home as a short sale, and wondering if you should or you shouldn’t, call 619-929-1413 or write td@tomdunlap.com to get advice and straight answers from Tom Dunlap – San Diego’s top short sale specialist.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Divorce – what to do with the house?

One of the questions that must be answered in divorce is “What do we do with the house?”

If you’ve needed your combined income to maintain the payments on your San Diego home, neither of you can handle it alone, so you’re forced to make a decision.

One choice is to keep the house and rent it out to cover the payments. Another is for one of you to remain in the house and rent a portion of it to assist with payments. However, renting does come with its own problems. One is compromising the tax status. The other is dealing with tenant issues such as collecting rents and performing “fix-up” duties after a tenant moves out. Your neighborhood zoning may also be a factor.

The other choices are selling or letting the house go into foreclosure.

Selling your San Diego home is always the best option.

If you have equity in the home, this is obviously the easiest and best solution. But even if your San Diego home is “underwater,” selling as a short sale is not only possible but will be more beneficial to both of you.

*Should you short sale or shouldn’t you? Call 619-929-1413 or write td@tomdunlap.com to get advice from San Diego’s top short sale specialist, Tom Dunlap.

When You Let Your San Diego Home Go Into Foreclosure…

At first glance, this might sound like a good option. One of you can remain in the home without making payments until a foreclosure is final. With many lenders taking a year or even longer to complete a foreclosure, that would give you breathing space and time to put away some funds before needing to find a rental. At the very least, you’ll have about 6 months from the time you make the last payment.

But this option does have drawbacks. First, it will severely damage your credit scores and thus your ability to rent or buy a home in the future – and even your ability to get a job. And unless only one of you signed the mortgage documents, this damage will apply to both of you.

It doesn’t matter if the divorce decree gave the house to one spouse. What matters is whose signature is on the mortgage loan application(s).

Next, if you have a home equity line of credit, the second lien holder can sue you and obtain a deficiency judgment. And, just as everyone’s credit scores will suffer, this judgment will obligate anyone whose name is on the application.

Finally, if you allow your house to go into foreclosure, you’ll both be ineligible for a new mortgage loan for from 5 to 7 years.

Good reasons to choose a San Diego short sale instead

Your credit scores will take a smaller hit and notice of the short sale will “fall off” your credit report in seven years rather than ten.

The time before you can get a new loan will also be shorter. After the short sale of a home, if you meet the other qualifications, you can get a new mortgage in as little as 2 years.

Short sale consequences are far less severe than the consequences of a foreclosure…

So if you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and are facing divorce and loss of income, think seriously about a short sale.

Call 619-929-1413 or write td@tomdunlap.com to ask your questions and tell us the situation. We’ll give you straight answers.

First, we’ll be happy to help you determine whether you do have equity in today’s market. Then, if you need to short sale your house, we’ll explain the real estate short sale procedure and answer all your questions.

We specialize in San Diego short sales and over the past 9 years have maintained a 98% success rate in getting short sales closed. So get in touch. We’d like to help you avoid foreclosure, too.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Are the Banks Negligent, Indifferent, or Inefficient?

Whatever they are, their actions all too often spell financial loss for San Diego homeowners.

Here are 3 ways that loan servicers and asset managers are keeping some San Diego homeowners in distress.

1. Asset managers routinely delay their response to short sale requests.

Most San Diego home buyers want a “yes or no” answer within a few days of making an offer to purchase, but when they attempt to purchase a home in short sale status, they’re forced to wait. In fact, agents report waiting 6 months or even more just to get a yes or no.

The result: Many homeowners go into foreclosure while a ready, willing and able buyer stands ready to purchase.

The second result: Buyers withdraw their offers when their patience runs out. They made the offer because they wanted a home – so they move on and choose one that’s readily available. We can hardly blame them for that.

Those who are willing to wait for an extended period of time expect a bargain in return for their patience, and we can’t fault them for that, either.

This delay in responding to short sale requests causes many San Diego buyers’ agents to avoid showing short sales. It’s much easier to get an answer after a home becomes a bank-owned foreclosure.

Why do loan servicers delay response? Is it inefficiency, negligence, or indifference?

If banks wanted to protect their investors and help the real estate market rebound, they would make the short sale approval process as fast as possible. And they could. They could, but so far all they do is talk about it.

They could begin the property valuation process just as soon as they get the short sale request. They could also inject some common sense. After handling dozens of foreclosures and short sales in a given area, they should know market values. If homeowners knew the bank’s “bottom line” they wouldn’t waste time considering offers that were sure to be rejected.

* Should you short sale or shouldn’t you? Call 619-929-1413 or write td@tomdunlap.com to get advice from Tom Dunlap – San Diego’s top short sale specialist.

2. Banks routinely reject loan modifications that would prevent foreclosures and preserve neighborhood values.

While a few homeowners have been granted loan modifications, more have been refused. You’ll find no shortage of stories about homeowners who spent months submitting paperwork before being denied. Others have been granted trial modifications and faithfully made payments, then been denied.

And the guidelines are both unclear and conflicting. One representative tells the homeowner they must be in arrears to be considered – another tells them they must not be in arrears.

Many who “do not qualify” are wondering why. One woman I spoke with said “We’ve been managing not to get behind with our payments at $1,700 per month. But the bank says they’re denying our modification because we can’t afford $1,100 per month. Does this make sense?”

The result: Homes in foreclosure that could have been saved and neighborhood values dropping because of the presence of vacant homes.

Is it deliberate negligence, indifference, or inefficiency?

4. Banks that repossess San Diego homes simply don’t get them on the market in a timely fashion, and don’t maintain those homes while they stand vacant. And as we all know, vacant homes or poorly maintained homes bring down neighborhood values even as they erode the value of the house in question.

Is this because they simply have too many homes to deal with? Is it an intentional delay because they don’t want to flood the market with repossessed homes? Or is it because they have failed to develop efficient ways to streamline their processes?

Whatever the reason, entire neighborhoods have been damaged by the banks’ failure to act in a timely manner.

The good news for San Diego homeowners and short sale buyers is that we have developed systems and relationships with loan servicers that get our short sale requests pushed to the “front of the line.”

We can generally get an answer within 60 days or less, and because we know how to present our short sale requests and negotiate with the banks, that answer is usually “yes.” In fact, we have a track record of 98% success in closing our short sales.

No two short sale situations are exactly alike. When you want advice that applies to your specific situation, call 619-929-1413 or write td@tomdunlap.com to request a no-obligation consultation.

And if you already know you want to short sell your home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, Metro San Diego, or downtown San Diego, or if you’d like to purchase a short sale, get in touch.

We’ll be glad to explain the short sale process, tell you what you can expect as a buyer or as a seller, and show you why we get good results while so many who attempt short sales fail.

We look forward to talking with you… so get in touch and we’ll set a time to get together.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Why Over 40% of California Short Sales Fail to Close

Don’t take chances with YOUR short sale.
According to a March 8, 2011 news release from the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.), fewer than 60% of short sales begun in California during 2010 actually made it to closing.

That news came as a result of a Short Sale Lender Satisfaction Survey conducted in December 2010, and answered by 2,150 California REALTORS®. Of those responding, 94% said that they had participated in at least one short sale transaction in 2010.

Although there has been no follow-up survey to give us statistics for more recent years, we do know that laws passed in 2011 made it even more difficult to bring a short sale to closing. Under those new laws, second lien holders can only seek deficiency judgments after foreclosure. A short sale removes their opportunity to recover more than a small percentage of funds lent on second mortgages and home equity lines of credit. Thus, many second lien holders are reluctant to approve short sales.

As a result, it is more important than ever to seek help from an experienced and skilled California short sale negotiator.

The 2010 survey revealed overall dissatisfaction with lenders and loan servicers. And of course, that hasn’t changed. Some REALTORS® reported delays of more than 6 months in getting a written answer to a short sale request. Most reported a response time of just over 2 months. Nearly half of the REALTORS® responding said that lenders took more than five business days to respond to any form of communication, including telephone and email messages.

This should not be surprising, given that many agents work on only a few short sales per year and simply don’t have the experience necessary to deal with the banks.

REALTORS® who hope to succeed in handling short sales should learn all they can about each lender’s preferred procedures and then follow them to the letter. Submitting a short sale request in the manner that each bank prefers will help keep your request at the top of the pile. Mistakes will send it to the bottom.

As successful short sale specialists, we’ve also learned that it’s vital to develop working relationships with loan servicers in each bank. Because we’ve made the effort to develop these relationships, we can generally count on a response to our emails or phone calls within 48 hours.

We’ve handled hundreds of short sales for San Diego County homeowners over the past 8 years, and with good results. In fact, we’ve maintained a 98% success rate, even when dealing with banks that many consider the most difficult.

Success comes as the result of sound preparation and presentation, combined with persistence and strong negotiating skills.

If you’re underwater on a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, Metro San Diego, or downtown San Diego, you may be wondering: Should I short sale or shouldn’t I?

Before you decide, call 619-929-1413 or write td@tomdunlap.com to get advice from Tom Dunlap – San Diego’s top short sale specialist.

We will be happy to explain the entire short sale process, show you the steps that lead us to success when others fail, and answer any questions you might have.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.