• Latest trends in Existing Homes Sales (Hint: Things are looking up… although Prices Are Still Down);
• The very real relationship between unemployment and home prices; and,
• Information about our upcoming press release

 4.1% Uptick in Existing Homes Sales; Prices Off Slightly

If you’re waiting for a billboard announcing that it’s time to dive back into the real estate investing pool, this might be the sign you’re looking for. Pending home sales – a great indicator of the perceived overall health of the real estate market – rose by 4.1% in March.

The question some investors (and other real estate professionals) have is: Why does this matter? The short answer to this all-important question is that pending sales show actual market moves right now. Real estate transactions have a natural life cycle, and pending sales are reflections of what’s actually going on in regional real estate markets nationwide, as opposed to someone’s best guess about what could happen at some point in the future.

Multiple factors play a role in real estate’s slow return to health: (Click here to keep reading)

• Unemployment (for more on the role unemployment plays, see this month’s feature article for fascinating inside information)
• Interest rates
• Availability of credit
• Real estate prices
• Buyer confidence in regional/national real estate markets

Even though pending sales eased up in March, it’s important to note that real estate is currently throwing off mixed signals. Low interest rates are convincing increasing numbers of buyers to take advantage of great buying opportunities. The problem? For many buyers, credit is still tough to get. Because most buyers are unable to wrap their hands around the cash they need for real estate purchases, they rely on credit to finance transactions. As you can see, this can put a damper on purchase plans if financing isn’t readily available.

For those who can tap into cash, credit and/or investing partners – this is a good time to buy. Sales prices of existing homes dropped slightly (3.5% for the 12 month cycle that ended in February; off 0.8% since January). Keep in mind that prices are off sharply in some regional markets, while others are seeing modest increases. This illustrates the importance of doing your homework before making a purchase, and ensuring that any property purchased is either purchased below current market value, is throwing off positive monthly cash flow – or both.

In the end, mixed signals are keeping the market depressed. I’d like to say there’s a quick fix, but the reality is, there’s still a long way to go. Your best bet is to stay on top of the latest home price numbers and foreclosure data, especially if you’re investing in pre-foreclosure real estate.

Unemployment and Home Prices: A Direct Connection?

Home prices, like the unemployment rate, rise and fall. Recent research into this fascinating subject seems to support the idea that the two are inextricably linked. The American Institute for Economic Research compared home price and unemployment data over an extended period of time – nearly 20 years – and determined that a 1 percentage point drop in the unemployment rate yields a very real payoff in real estate prices: a 3.7% rise.

This study involved 20 major metropolitan areas, so these aren’t just highly localized numbers from one or two areas. Since many of the sample markets are located in different geographic areas, with vastly different unemployment rates, it makes sense that the results are accurate nationally.

Here’s a point to ponder with this study: In many ways, tying real estate prices to the unemployment rate makes sense. The reason? A higher unemployment rate typically means a smaller pool of available buyers for real estate. Since so much of the real estate market is tied to supply and demand, a buyer’s market is created when there are fewer potential buyers (and an almost unlimited supply of available properties).

Real estate prices aren’t really going anywhere fast right now, and this could be true for the intermediate term. Again, it comes down to unemployment. While the rate is undeniably falling – slowly – prices aren’t really headed up. In many cases, just the opposite is true.

I think it would be truly fascinating to analyze unemployment and home price data while considering the number of Americans who are underemployed, are working part-time and/or are no longer counted in the official number of unemployed because they’ve grown discouraged and are no longer actively looking for work.

Unemployed – or underemployed – people aren’t in the market to buy homes, even if they might be interested in making a purchase. Bankers, in the business of writing loans to people with a demonstrated ability to make timely mortgage payments (regardless of banks’ recent experiences to the contrary) have little incentive to take a gamble on loans almost guaranteed to fail. As a result, demand for mortgages and real estate declines even further.

Real estate investors are always trying to find the most accurate information available that will enable them to make sound investing decisions. I think there’s a very real correlation between the unemployment rate and home prices, although the impact may be more profound right now as the nation tries to recover from the devastating effects of the economic/employment/real estate disaster.

The best thing any investor can do before pulling the trigger on a purchase is to have a clear understanding of their goals, their options and how they’ll make money with an investment before spending a penny. Only then will they be ready to reap the rewards available in today’s market.

Press Release Coming

Keep your eyes posted for our next press release, which is coming in the very near future. We’ll give you the scoop on the Phoenix metro region, and tell you how this critically important market is faring as it continues its recovery

In this month’s Home Stand, we’re going to tackle a few great topics:

• Details about a great investing strategy being employed by big investors (and how you can tap into these markets even if you’re a small-time investor with big dreams)
• Tell you about the walk through hell that houses of worship and other non-profits are facing
• Give you advance notice about our upcoming press release. Hint: Motor on through the rest of this month’s Home Stand – we’ll reveal details about when you can expect to see the press release

Tapping Into the Same Markets as the Big Investors One Profitable Property at a Time

If real estate investing is your chosen pathway to prosperity, you’re already well-aware that many roads can lead to the same destination. Rather than opening a roadmap and hoping for the best, why not take the lead of well-heeled (and funded) investors? I’m talking about a strategy that could best be described as a staggered flip.

If you’ve read the Home Stand for any length of time, you already know that the U.S. is awash in a sea of foreclosures. If the owner can’t get current on their mortgage or successfully emerge from a loss mitigation program, at some point their home will likely be sold at auction.

This is where big equity investors are focusing their attention right now. Here’s what they’re doing in a nutshell — and how you can follow their lead to smart profits: (click here to learn how to profit like a big investor)

• Estimate the value of properties – These estimates are developed by carefully thinking about proximity to schools, freeways, shopping, etc. While the big investors are tapping into automated software applications (some are custom-built), the bottom line is these firms have to decide how much a property is worth, and bid accordingly. Even if you don’t have a high-powered software application, you can still get accurate figures by taking a more manual approach (and by tapping into some of Default Research’s industry leading information services).
• Determine market rent — Because so many people have been displaced by the foreclosure crisis, demand for rentals is at an all-time high. Demand drives rent rates even higher, so by investing in more up-market areas, you can reap the financial rewards that come from higher rent rates (and regular rent increases).
• Purchase properties — When you arrive at a maximum auction price (still at least 20% below current market value), start low and bid up to your pre-determined maximum. Stick to your guns and walk away if you haven’t yet won when the price rises to the top of your comfort level. There are a lot of properties out there, so play it smart.
• Renovate (if needed) — Once you’ve purchased the property, make needed renovations. Since your ultimate goal is to keep rent rates as high as possible, make renovations which are in line with what renters would like: Decent kitchens, bathrooms and common areas. Tile is good; so are granite countertops.
• Lease properties — Don’t lease your properties to anyone with a pulse and the ability to some up with 1st and last month’s rent and a security deposit. Think longer term by pulling applicant credit reports and ensuring that they’re capable of paying you on an ongoing basis. If the tenant has an interest in future ownership, consider giving them a monthly rent credit, a portion of monthly rent which can be credited towards the purchase price (or used as a down payment on a lease option or owner financing program).
• Offer owner financing packages to qualified buyers — Some potential tenants have a strong interest in rejoining the ranks of home ownership, but don’t have the FICO score to substantiate a mortgage approval. With a down payment and an acceptable FICO score, you could be the bank, carrying the buyer for 3-7 years while they build equity and work on improving their financial situation.

These are all doable steps, regardless of your level of real estate investing experience. Yes, you’ll have to invest wisely. Rather than having a deep pool of investing capital (like the big equity investing firms), you’re probably counting on buying just one or two properties to get started. That’s fine, but you have other options including:

• Friends & family
• Lines of credit
• Equity in other properties you own
• Raising cash through business contacts
• Soliciting for it (web, advertising, direct mail, hiring professional help)

What it all comes down to is realizing that today’s market offers you unbelievable opportunities for financial rewards. You can tap into some of these profits by thinking big.

Churches, Non-profits Facing Foreclosure

Millions of Americans have gone through foreclosure; millions more stand to lose their homes in the next few years as the housing market recovers. It’s not just homeowners, though, who are facing these issues. Churches and other non-profits are falling into the gaping hole that is foreclosure.

The reason is relatively simple. Houses of worship and other non-profits rely on donations – tithes, offerings and other gifts — to meet their operating expenses. Before the real estate bubble popped, donations to these organizations were flowing fairly freely. Because churches and non-profits exist to help as many people as they can, many churches and non-profits took advantage of low interest loans to fund expansion projects.

Then the bottom fell out. Not only did property values drop, but the income churches and non-profits rely on for survival dried up as members received pink slips from their employers, which meant that their members could no longer afford to maintain their levels of giving that they did previously.

Even churches that had some cash in the bank when the crisis hit have run into trouble. The reason? Most churches, faith-based organizations and non-profits receive commercial loans for their building projects. Unlike residential mortgages, which are typically repaid over a 20-30 term, most building loans are due in 3-7 years, at which time they are generally refinanced. By the time many of these loans were due, lenders were unwilling to refinance. The bottom line? Lenders called the loans… and churches and some non-profits have been unable to pay.

While there are more than 300,000 churches and non-profits in the U.S., 270 churches have gone through foreclosure. This number will rise as the real estate and financial markets work through their recovery process.

Don’t Forget… Default Research Has a Press Release Coming

One last Home Stand note for March: We’ll be issuing an important press release soon. High unemployment has wreaked havoc on the Detroit real estate market. Are things getting better for this area? Check back soon when we release the latest numbers for the Detroit housing market, which includes Wayne, Macomb and Oakland Counties.

Just as winter eventually ends, the national real estate climate is slowly defrosting, giving way to a warmer future. According to the National Association of Realtors, nearly 100 local real estate markets, including those of markets as diverse as Miami, FL; Boston, MA; Memphis, TN; Salt Lake City, UT; Detroit, MI; Memphis, TN; and Kansas City, MO, have warmed.

It’s important to note that inclusion on this list doesn’t mean that any of these local markets is by any means “red hot” – it simply means that the market is showing signs of life over a period of six months. Because so many local real estate markets were battered and bruised by rampant foreclosures, high unemployment and other signs of economic distress, it doesn’t take much to count as an improvement.

That said, 36 states have a track record of sustained improvement – albeit for a somewhat limited improvement period of at least six months. Does this mean the real estate crisis is behind us? It could. That’s why it’s crucial that you keep coming back to the Home Stand every month for up-to-date market information.

In this month’s issue, we tackle several important topics including:

• Specifics of Arizona’s foreclosure law and how it applies to your real estate business;
•  Telemarketing best practices, which will finally enable you to take your real estate business to that much sought after “next level” – while keeping you out of the crosshairs of federal and state regulators and law enforcement agencies
• How you can grow your business in 2012… and beyond using the telephone

South Florida Foreclosure Numbers Are Coming

We’d like to start off this month’s Home Stand by reminding you that we’ll be revealing the nationally important South Florida real estate market numbers very soon. What will the numbers say? Has the Miami-area real estate market finally turned a corner? Keep your eyes open for this important release coming soon!

Primer on Arizona Foreclosure Law

Arizona’s pre foreclosure and foreclosure real estate markets could be the prescription for your financial prosperity in 2012. Before you dive into this market, though, you need to make sure you understand the specifics of the law. And if you’re an active private investor in this market – and you provide mortgage financing to buyers in Arizona – special legal provisions impact your ability to foreclose on buyers. One false step could land you in regulatory of legal hot water. Here’s what you need to know about foreclosure in Arizona.

First, Arizona is a non-judicial state, meaning that the foreclosure process (in most cases) doesn’t play out in the courts. Instead, Arizona lawmakers have effectively given neutral third parties (known as trustees) the power to transfer legal ownership of a foreclosed property from the borrower and the lender once all legal collection options have been exhausted. Here’s the process:

•  Missed Payment – At this point, the borrwer is in technical violation of the terms of their mortgage loan. Most lenders will wait until the grace period has passed (typically at least 15 days) before beginning collection activities.

• Notice of Default – Once the homeowner has passed the 30 day threshold (after the initial missed mortgage payment) a Notice of Default is filed. This document is mailed to the homeowner and the trustee as a means of letting the borrower know that they need to immediately correct their deficiency or face the possibility of losing their home 150 days later (180 days after the first missed payment). Lenders will continue collection activities, including mailing letters and/or calling borrowers and/or co-signers on the phone in an effort to bring the mortgage current.
• Loss Mitigation – Beginning on the 61^st day of delinquency, most institutional lenders will have their loss mitigation department begin contacting the borrower to convince the homeowner to bring their loan current. Phone calls and letters will continue, and late charges and fees will continue stacking up.
•  Notice of Trustee Sale Recorded – Beginning on the 91^st day after the first missed mortgage payment, the lender effectively washes their hands of the delinquent account and the trustee takes over the legal process. The Trustee will ensure that the Notice of Trustee Sale is properly recorded and that all parties with an interest in the property (the borrower and all recorded owners) are notified in writing by certified mail within 5 days of recording that a Trustee Sale will take place at least 90 days later, after publishing a Notice of Trustee Sale in the newspaper once weekly for at least 4 consecutive weeks. At least 20 days before the scheduled date of the Trustees Sale, the Superior Court in the jurisdiction in which the property is located must be notified in writing.
• Trustee’s Sale Takes Place – Unless the homeowner successfully brings the loan current by paying all outstanding monies due on the mortgage loan including fees, interest and legal fees (or the borrower successfully completes a short sale with lender approval) the Trustee Sale will take place. At this point, ownership of the property will be transferred to the lender, and the borrower will be forced to vacate the property.

Important Exception to Arizona Foreclosure Law

An important caveat to Arizona foreclosure law applies specifically to real estate investors who act as lenders (investors who provide owner financing to end buyers).  If this situation applies to you, it is not necessary to wait 91 days after the first missed mortgage payment to file and schedule a Notice of Trustee’s Sale. Technically, it can be done as soon as the borrower first becomes delinquent on their mortgage loan. It will be up to you as the investor to determine whether you wish to pursue such extreme measures on a more expedited timeline or if you prefer to give the borrower the same amount of time afforded to institutional borrowers.

Telemarketing Best Practices

As a real estate investor, the telephone can be an effective tool. You use it to communicate with potential buyers and sellers of real estate just about every day. What you might not realize, however, is that this simple electronic device can be a pathway to enhanced financial prosperity – or a ticket to legal problems. For this reason, it is crucial that you understand national rules govern telemarketing, and common sense best practices can help you succeed with your telemarketing campaigns.

Federal Rules Apply; State Rules Also Govern Your Telemarketing Activities

Whether you personally make your own telemarketing calls or you hire a marketing firm to make calls on your behalf, it’s crucial that you understand that a patchwork of Federal telemarketing laws apply to your activity. In addition, laws specific to the state in which prospects are called also applies, and in almost all cases, the law holds you responsible for following the law 100% of the time – without deviation.

Sound tough? In some ways, it is. Taking the time now to familiarize yourself with the rules can help prevent legal trouble down the road. The point of this article, however, isn’t to tell you what the law entails. That would be too difficult in the limited space we have available in the Home Stand. Instead, we want to shine a bright illuminating light on the subject and point you in the direction of resources that can help you comply with the law including:

• FTC (Federal Trade Commission) include link
• TCPA (Telecommunications Consumer Protection Act)
• State telemarketing resources

Distressed Homeowners Make Good Prospects

One of the reasons telemarketing makes sense for real estate investors is because of volume. Rather than trying to reach out and touch each qualified foreclosure lead you get (from Default Research lists or elsewhere), the telephone can enable you to reach more prospects much faster than you could if you were to pay each prospect a personal visit.

Before Beginning Any Campaign, Decide Who Will Call

Will you handle your own telemarketing or will you outsource this task to another party? Some investors prefer to personally make calls themselves; others want to wash their hands of the process and hire professionals to call on their behalf. If you choose to hire a professional telemarketing firm, keep in mind that the company you hire is you representative. Everything they do or say reflects upon you – and you are ultimately responsible for ensuring that the telemarketing firm is in full compliance with all applicable telemarketing laws.

If your target audience includes distressed homeowners, keep in mind that you are also required to comply with state foreclosure laws. Be vigilant on this issue! Some states impose hefty civil and/or criminal penalties if anyone except licensed real estate agents,  attorneys or state-licensed mortgage brokers contact distressed homeowners by telephone. Know the laws!

Scripted Calls Go Better

Have you ever seen what happens when newscasters try to wing it if their teleprompter breaks or they aren’t prepared to speak when called upon to do so? That’s right… they sound like morons. The same is true of telemarketing.  For this reason, it’s important that you put together a script that you’ll use when contacting distressed homeowners. Here are a few highlights to keep in mind:

• Script needs to comply with federal and state telemarketing and foreclosure laws including the National Do Not Call Registry. Passed into law some years back, this law
• Script needs to be “natural”, meaning that it’s imperative that the person making the pitch convincing, conversational and have the ability to HONESTLY connect with prospects in a way that encourages them to work with you without deceptive, shady or underhanded tactics.
• Script must comply with TCPA (Telephone Consumer Protection Act) which requires telemarketers to clearly identify themselves, the company they’re calling for, the nature of the offer, the cost of participation in what you’re offering (if any), among others. In addition, you MUST agree to remove an individual from your marketing list and give written verification (if requested). Finally, each call must have a legally compliant TCPA close… something to the effect of “Thank you for your time. If you have questions or concerns about this call, please call (name of business) at (telephone number). The TCPA Close MUST be given without fail if you speak with your prospect and you give your name or the name of your company, and must be said in its entirety even if the prospect hangs up. Don’t miss this step… massive federal fines can be levied against you and your business if you fail to take this step.
• Track results using a CRM. While some fancy and very expensive telemarketing computer software applications are available that give detailed reports of number of calls made, average talk time, call disposition (hang up, no answer, sale/appointment set, Do Not Call, etc.), these are developed primarily for large professional marketing firms which use teams of telemarketers and autodialers. You don’t need all these bells and whistles…just the ability to track your progress and see if a particular campaign is working.

Secret to Telemarketing Success: Magical List, Great Script and Legal Compliance

Telemarketing success in your real estate business is less about luck than it is having a great script, the ability to comply with the ever-growing patchwork of laws governing telemarketing and foreclosure, as well as the quality of your list.

This is something Default Research works very hard at. We don’t cut corners with our lists, and we give you the most accurate, up-to-date information on the market, including telephone numbers. Once you purchase one of our default lists {embed link}, all you’ll need to do is scrub the supplied list against the National Do Not Call Registry to ensure that you don’t wind up in the crosshairs of regulatory or law enforcement authorities… and put your real estate business on the pathway to prosperity in 2012!

• State of the California Pre foreclosure market
• Helpful analysis of 2012’s most lucrative investing strategy
• Number crunching: December’s California pre foreclosure report
• California foreclosure law: what you need to know before you invest
• California legal round-up: SB708 – In or Out???

 Rentals Seen as Pathway to Prosperity for Buy and Hold Investors

While some real estate investors crunch numbers, refine strategies and otherwise try to determine the best ways to make money from real estate in 2012, other investors are rolling up their sleeves and diving headfirst into “buy and hold” real estate investing.

The reason is simple: Great deals are abundant, prices remain low (especially when compared to the market highs before the market implosion), and there remains an abundance of pre foreclosure and REO property on the market.

For investors with access to cash, institutional financing, self-directed IRAs, hard money loans, and other financial resources, 2012 offers the opportunity to buy low – sometimes very low – and hold property as a steady stream of consistent revenue, banking on future prospects of equity appreciation.

Investor-Friendly Federal Rules Changes on the Horizon?

The federal government has tried multiple tactics and strategies to encourage positive improvements in the U.S. housing market. Determining in advance what any federal agency will do is foolhardy, but it’s important to point out that multiple housing experts are predicting that government regulators are beginning to embrace the idea that real estate investors may play a crucial role in any sustained recovery.

What form will this role take? Will federal housing authorities eliminate recently enacted “arm’s length” restrictions preventing lenders and short sale buyers from renting properties back to the former owner? Think it can’t happen?

It could.

Right now, Sallie Mae and Freddie Mac are considering exempting themselves from these same rules so they can get in on the landlording action. If they exempt themselves, might they not also revisit the rules for others? It’s possible. Only time will tell.

If these rules are relaxed, explosive new opportunities will exist for real estate investors to take advantage of already lucrative buy and hold opportunities. Rule changes would make it even easier for investors to get into the buy and hold market, reaping the rewards of positive cash flow while laying a foundation for equity appreciation once property values once again begin rising.

California Notices of Default and Notices of Trustee Sale Numbers Released

Solid improvement in the California pre foreclosure market is well underway, according to the numbers for December 2011. How much better are these numbers than those posted in November? What do the numbers mean? Find out now by reading our press release yourself at www.live-pr.com.

California Foreclosure Law: What You Need to Know Before Investing

Failing to understand the California foreclosure process could be a costly mistake. Aggressive civil and criminal penalties make it imperative that you fully understand California foreclosure law before you begin investing in this pre foreclosure rich state.

Unlike many states, in most cases California foreclosures operate on a non-judicial basis, meaning that it isn’t necessary for lenders to take borrowers to court in order to gain legal control of foreclosed properties. Instead, borrower legal protections are ensured by a Trustee, a neutral advocate selected by the state to ensure that California foreclosure law is followed. This person acts in much the same way as a judge.

Once a scheduled mortgage payment is missed, the homeowner officially falls into default on their obligation, and the foreclosure clock begins ticking. In most cases, the lender will immediately reach out to the borrower to encourage compliance with the mortgage agreement. Lenders are required to give borrowers a minimum 30 day period to bring their payments current before beginning any foreclosure proceedings.

If the homeowner fails to bring their mortgage payments current within 60 days of the first missed mortgage payment, the lender will file a Notice of Default, which places the borrower on notice that their ability to retain ownership of their home is in jeopardy.

The lender will continue working with the borrower to resolve the mortgage deficiency. A minimum of 90 days after the Notice of Default is given to the borrower, the lender is allowed to serve the borrower with a Notice of Trustee Sale. At this point, all is not lost for the borrower, but the sand in the foreclosure hourglass will be decidedly low. A minimum of 20 days after the Notice of Trustee Sale, the property can be sold.

It’s also important to point out that California has special protections in place for renters. Because renters can be faced with displacement in the event that the property they live in is foreclosed, California state law requires that all tenants be provided with written notice of any impending foreclosure action to ensure that tenants can seek alternative housing solutions. This 60 day period is twice as long as the 30 day foreclosure notice period granted to homeowners facing foreclosure.

California’s foreclosure process is fairly straightforward and easy to understand, although it can be a bit confusing for homeowners (and real estate investors) taking their first foray into the California foreclosure process.

Extension of SB708 in the Works?

California lawmakers are in the process of extending SB708, a popular legal provision that provides California homeowners and other interested parties a bevy of legal protections. Some of the highlights of these provisions include:

• 30 Day Foreclosure Process Delay – Before lenders are allowed to initiate foreclosure proceedings against a delinquent homeowner, this law requires lenders to make a good faith effort to contact the borrower and work out an equitable solution.
• 60 Day Renter Protection – Because renters aren’t always in the loop of timely information, this law gives them a little extra time to locate appropriate housing before they can be evicted as a part of the foreclosure process.
• Forced Property Maintenance – Another key provision of this law is forced property maintenance. The reason is simple: As foreclosed properties fall into a state of disrepair, properties can become eyesores for neighbors. Forced property maintenance seeks to remedy this problem by assessing fines to offenders at $1,000 per day. This helps to encourage lenders to maintain their properties, regardless of whether they have willing buyers ready to take properties.

As you can see from this month’s newsletter, it’s important that you stay abreast of the latest real estate investing news, investing strategies, and market research to give you the best possible chance of succeeding in California’s real estate market – or for the matter, any real estate market.

To give yourself an edge in your own business, we recommend you plug into the best pre foreclosure data available in the industry. To learn more about Default Research’s detailed pre foreclosure reports, visit www.defaultresearch.com

- Here at Default Research, we’ve come up with a good way for you to save massive amounts in the new year – 50% – while tapping into the cutting-edge resources we make available.  At the same time, we are offering you the chance to sample the brand new statewide information we’re rolling out for Alaska, Idaho, Montana and Oregon.

Rather than bore you with the details of one of our staff meetings, it’s better to just dive into the sensational money-saving details, and let you choose-how you want to save the most.

Your First Chance at the New States… and Your Last Chance to Save Big!

I told you in last month’s Home Stand that we would debut new Notice of Trustee Sale information for all counties in the states of:

Alaska
Idaho
Montana
Oregon

I’m certain that timely Notice of Trustee Sale information can make you a better, more effective investor, and that this data can help put you in a better position to reap the rewards available in these select real estate markets. What better way to entice you with the best moneymaking information in the industry than to give it to you for 50% off? If you act now, you’ll pay only $99.99 for each whole state instead of our regular price of $199.99. To make sure you get in on the savings, use discount code LastChance2012 for these states… and act fast because this deal goes away forever on Friday the 13^th of January.

Default Research Last Chance 50% Savings Opportunity Good on Everything Else

I can already hear existing customers saying, “But what about me?” So these savings are good for new and existing customers if you act fast – and the savings opportunities have been extended to all of our service subscriptions:

• 50% off all new orders — Good on any county or state
• 50% off for existing Default Research subscribers extending existing subscription

To take advantage of this offer, you’ll need to enter promotion code LastChance2012 at checkout, and you have to do it before January 13th, 2012. Take advantage of this chance to save big… while you still can!

Phoenix Notice of Trustee Sales Plummet

The Phoenix Notice of Trustee Sales numbers are in, and here’s what the numbers show: a massive drop of 42% year over year. What’s the reason for the sharp decline… and what do these numbers say about the health of the Phoenix housing market moving forward? To find out, read Default Research’s December 2011 Phoenix housing market press release at http://www.pressreleasepoint.com/maricopa-county-notice-trustee-sales-plummet-57.

Effective Solutions to the Nation’s Housing Crisis

While many people have pronounced the American Dream of home ownership dead for the foreseeable future, there is a clear path forward from the housing doldrums. In order to understand where we’re going, we have to look at recent history and assess who deserves blame. Only then can we move beyond crisis mode and into full-blown recovery. And we will recover… just not the way you might think.

First, I want to tell you that I really don’t believe that a single bogey man is responsible for the mess that is the U.S. -housing market. The reason? There are simply too many culprits with a hand in this catastrophe. Here they are (in no particular order):

Government – Without diving into the personalities involved in this mess (that would be too easy), I think it’s fair to say that elected and appointed government officials, along with the do-good, feel-good crowd created a toxic environment that exploded in their faces. Rather than accept their rightful place at the blame table, these wimpy officials did what they do best: they passed the buck… and it cost us plenty.

Speculators – While a few speculators overplayed their hands in their investing strategies, smart speculation has its place in a healthy real estate market. That’s why it’s so crucial to get your hands on the best, timeliest foreclosure data. For investors who were unprepared or were caught flat-footed when the market tanked, a valuable lesson has been learned. And I’m certain speculators will be ready to pull the plug the instant the data shows it’s time to get out of the next bubble market.

Lenders – I understand that lenders were pressured by elected officials and certain unnamed special interest groups to make ill-advised loans. Rather than speak up and say that some borrowers don’t deserve credit, they caved to the pressure — and compounded the problem by engaging in stupid loan bundling practices. There’s no such thing as “too big to fail”. But, “too dumb to prosper” has reared its ugly head.

Borrowers — In the first category of borrowers, I include homeowners who probably should never have been anything but renters: those with horrible credit; folks who played the liar loan game; people who believed that $300,000 mortgages on the basis of $30,000 incomes was a good deal. Yes, there were lots of homeowners who were victimized by their lenders. At the same time, a great many homeowners played games… and lost.

ATM Debt Management Strategies — A second category of borrower involves those homeowners who get starry-eyed at the prospects of inserting imaginary plastic cards into their homes, pulling out huge wads of cash — and never repaying those loans because all they had to do was wait for their home’s value to rise before the bills came due. When the market crashed and their homes lost value, they were forced to face the harsh reality that ATM machines have to be refilled periodically. Absent the cash to do it themselves, they defaulted… sometimes “strategically”. This escape strategy made an already horrible real estate market all that much worse.

This is quite a cast of characters. Isn’t it? Now let’s talk about a possible way out of this mess.

Renting Our Way to Real Estate Prosperity

Government officials, lenders and others with at least a little skin in the game seem completely unable to resolve the housing crisis — with money, the bully pulpit or any of the usual tools of the trade. While they collectively fiddle around the edges, nothing happens in the heart of the real estate market.

Maybe they’re approaching this from the wrong angle. Let me explain what I mean:

The national rate of home ownership is dropping, modestly for now, but this decline tells me that people don’t feel confident in their prospects for owning a home anytime soon. As the decline in homeownership picks up steam, I think it’s obvious that someone is going to be buying a whole lot of houses. So who will it be?

Real estate investors. Big, small, domestic and foreign, real estate investors will be the lifeblood to the resurgence of the American real estate market.

But if it’s going to happen, lenders are going to have to unhand some properties. I don’t necessarily mean lenders need to give away real estate, but I think they need to make it easier and more palatable for real estate investors to get their hands on losing assets — at prices that make sense, given market realities.

I’ll say it now: Lenders are going to pay a price, and I think this is fitting after the way so many of them behaved in the market’s run-up before the big market hangover.

We’ll recover fully, although it might take a full ten years to get to that sweet spot known as full recovery.

And I think we’ll do it one tenant at a time.

From the Default Research family to yours, the best to each of you in this new year!

So what are these “exciting” changes?

These changes are on two fronts: First, because Notice of Trustee Sale states hold so much potential for real estate investors, beginning in December, we’ll have detailed numbers available for portions of:

• Idaho
• Montana
• Oregon

While these changes are exciting, I have more great news to share with those of you who invest (or have an interest in investing) in California, Nevada and Arizona. Yes, for some time we’ve had numbers available for portions of these three states, but you’ve asked for “more”.

If more is what you want, then more is what you’ll get.

Be on the lookout for December’s Home Stand because you’ll have the chance to take advantage of tremendous savings. Through the end of December, not only will you be able to lock into a 50% price reduction, but you’ll remain at that price for as long as you remain a continuous subscriber.

I know one of the biggest questions on your mind about this offer is, “So which counties are included?”

I won’t be able to name specific counties until December. What I can tell you is that many of you are going to have a very Merry – and early – Christmas once you learn the specifics of the counties to be included beginning in December. Be looking for the big announcement in December’s Home Stand!

Las Vegas Notices of Default Plummet in October 2011

The official numbers are in – and I need to report a huge decline in the number of October Notices of Default filed in Clark County, NV, the county which includes Las Vegas, one of the hardest-hit real estate markets in America.

To better understand the reason for this decline, it’s important that you read – carefully – this month’s information about Nevada foreclosure law and recent legislative action behind the numbers. Once you’ve done that, read what I believe the Las Vegas foreclosure market will look like in the short term by going to our most recent press release .

Introduction to Nevada Foreclosure Law

Understanding Nevada’s foreclosure process is a crucial first step in investing in Nevada, especially if you’re interested in pre-foreclosure real estate investing. The reason is simple: In the past, some states may have been willing to look the other way in the event that a lender (or a real estate investor) was guilty of technical violations of the law. Those days are gone. The foreclosure crisis – and widely reported violations of existing state law – has caused many to demand better enforcement of laws, as well as a brand new round of consumer protections intended to put the brakes on illegal foreclosures. It’s in your best interest to learn the details to ensure that you don’t find yourself in the crosshairs of state regulators or prosecutors.

Nevada Foreclosure Law: A Few Basics

First, it’s important to note that state law governs the foreclosure process. In most cases, lenders aren’t required to go through the hassle and inconvenience of filing suit against delinquent property owners. Instead, they’re often able to sell mortgaged property once they take a few quick, simple steps. The process is broken down into two main steps: pre-foreclosure and the Notice of Sale & Auction.

Pre-foreclosure

Pre-foreclosure, the period of time that begins when the borrower/property owner first misses a scheduled mortgage payment, is the most crucial to the homeowner. Here’s the short version of what the law requires:

• Homeowner becomes at least 30 days delinquent on mortgage payments
• Notice of Default is filed with county recorder
• Property owner is notified by mail of the default
• Property owner/borrower is given a minimum of 35 days in which to get current on their mortgage (includes past due principal, interest and fees)
• At least 90 days after recording the Notice of Default, lender is permitted to schedule foreclosure sale assuming borrower has failed to pay the defaulted amount (past due principal, interest and fees)

Notice of Sale & Auction

Nevada foreclosure law requires lenders to bring in an independent third party to carry out the sale of mortgaged property being sold by the lender (to ensure that adequate consumer protections are enforced). This third party, the trustee (the rough equivalent of a judge in judicial foreclosure states) is required to:

• Mail a Notice of Sale to the borrower and other persons listed on the deed as owners
• Post a Notice of Sale in at least three public places (based on guidelines contained in Nevada foreclosure law) at least 20 days before the scheduled sale date
• Publish a Notice of Sale in the legal notices section of a local newspaper once per week for at least three weeks prior to the sale beginning at least three weeks before the scheduled date of sale
• Hold the sale on the scheduled date (which is permitted to take place at the Trustee’s office), allowing anyone to bid. The winning bidder will be required to produce cash or a certified cashier’s check to the Trustee, although legal provisions do exempt the lender from this requirement.
• Transfer ownership of the property to the successful bidder (highest bid wins)

It’s important to note that the property owner doesn’t have a redemption period, so all sales will be final. The successful purchaser will have clear, unencumbered title to the property. An exception to this is the event that the borrower is able to convince a court to handle the sale, although this is rare. If a borrower does take the case to court, they will be granted a one-year redemption period when the property is sold.

Nevada’s New Foreclosure Law and Its Impact on the Foreclosure Process

There’s little doubt that Nevada – ground zero in the foreclosure crisis – has seen its share of mistakes, fraud and other lender irregularities. To combat these issues, Nevada legislators have passed a package of laws designed to protect borrowers from unscrupulous lenders. The new package of laws, which went into effect on October 1 has the following provisions:

• Independence – In years past, Nevada foreclosure law permitted loan services to utilize subsidiaries as Trustees. Due to legitimate conflict of interest concerns, the new law ends this practice and requires that only state-licensed attorneys, Title companies and others already regulated under terms of Nevada Trust Company laws will be able to serve in this role.
• Disclosure – In addition, the new laws also requires a level of disclosure not previously implemented in Nevada foreclosure laws by forcing lenders to include full contact information (names & physical address information) for all parties in a foreclosure action. The parties affected by these rules include Deed of trust beneficiaries, services, Trustees and note holders.
• Penalties – The new law also has teeth, requiring mandatory criminal and civil penalties for officers of companies violating terms of the new law.

This new law has dramatically reduced the number of Notices of Default filed in the first month since the law took effect. If you’re interested in pre-foreclosure real estate investing, this market remains a viable one. In order to take advantage of the best opportunities, it’s crucial that you have accurate numbers. Improve your chances of success by putting yourself in the driver’s seat with great information. Come back to the Home Stand in December for full details of the new counties we’re adding, but also take advantage of the 50% off sale we’re running. Investing is lucrative; taking advantage of today’s investing opportunities has never been as affordable as it is right now, thanks to Default Research’s current sale. To lock in your savings now, click here.

For some time our readers have asked, begged and pleaded for us to bring back the Default Research Home Stand. At first, we didn’t realize just how popular it was with readers like you. We’ve heard your messages loud and clear, so I’m happy to report that it’s back!

Before we dive into this month’s feature article, I need to let you know of a few powerful changes we’ve made to the Default Research user interface. You now have the ability to:

•  Change the way and/or timing of how you receive Default Research data
• Reactivate your account with just a click of your mouse, 24/7/365, to ensure that you remain in control of the flow of your Default Research information
• Update your billing and/or contact information online, including the ability to cancel your account or change payment methods without  needing to send an email or a fax.

To check out the improvements we’ve made, go to https://www.defaultresearch.com/customer.php/info

Because you work hard for your money you have better things to do with your precious time resources than email us  and wait for someone to resolve minor account-related issues that could just as easily be handled online. You asked for this improved site functionality; now you can enjoy a more streamlined experience — on your terms.

Beginning today, the Home Stand will help you demystify the foreclosure process in all the states we cover, in addition to telling you about some of the other legal/administrative issues with which you’ll need to be familiar. Florida is the first state we’ll dive into. The reason? Florida real estate is ripe for investment at this time, but before you invest a penny of your money, you need to understand the foreclosure process, especially if you’re going to tap into the foreclosure or pre foreclosure markets. To read more about Florida foreclosure law — and how you can capitalize on today’s unique buying opportunities.

Demystifying Florida Foreclosure Law

Florida’s foreclosure process operates under a judicial process, meaning that the courts are involved in every step of the foreclosure process. Justice may be blind, but it can also be slow. This is exceedingly evident within the confines of the Sunshine state; the average foreclosure takes 675 days to work itself through the court system according to the St. Petersburg Times (http://www.tampabay.com/news/business/realestate/foreclosure-crisis-tampa-bay-area-ranks-ninth-in-nation-in-length-of/1158222).

As I’ve mentioned, the foreclosure process is painfully slow (from the perspective of lenders who aren’t being paid). Once a mortgage payment is missed and the lender decides to initiate foreclosure proceedings — typically between 30-90 after the first missed mortgage payment — the lender’s attorney goes to court and files a lis penden (Latin, “a suite pending”). This filing is the first legal hurdle which must be crossed by the lender in their effort to regain physical possession of the foreclosed property. A lis penden filing clouds the title to ensure that potential purchasers of the property are made aware of the status of the mortgage, which sometimes deters potential property sales from moving forward.

If you’re interested in the pre-foreclosure market, lis penden filings can be a goldmine of information. The reason? Homeowners who are unable to make their monthly mortgage payments are seeking solutions to the financial circumstances in which they find themselves; a list of lis pendens filings can help you locate these homeowners. Many lenders are willing to consider short sales, but time is of the essence. The foreclosure process will continue to move forward, so it’s crucial that you be able to contact homeowners as early in the process as possible, to ensure that enough time remains to negotiate a short sale with the lender.

 Florida Foreclosure Fraud Prevention Act

Until January 2010, few regulations and/or administrative guidelines stood in the way of those seeking to offer mortgage loan modification services. With the passage of the Foreclosure Fraud Prevention Act, a laundry list of new rules went into effect. Even if you’re not interested in performing mortgage modifications, short sales are also covered under this wide-ranging law. (I found a great short sale FAQ at http://www.myfloridalegal.com/mfraud/nsf/pages/law.)

Here are some of the other highlights of the Foreclosure Fraud Prevention Act (which applies to Florida-domiciled loan modification firms as well as out-of-state firms modifying mortgages of Florida residents):

• Fee Prohibition — Before this law went into effect, it was common for loan modification companies to charge up-front fees. These up-front fees are now prohibited.
• Documentation Requirements — In the past, it was common for unscrupulous loan modification firms to make verbal promises to desperate homeowners, then change the agreement after modification work had begun, resulting in complaints of fraud/misrepresentation. The law requires that a written contract be signed prior to work beginning, and that the contract clearly specify the terms of the agreement.
• Pricing Fairness — With a stroke of the Governor’s pen, the Foreclosure Fraud Prevention Act outlawed a sometimes-used practice of raising the repurchase price of a home to an unreasonable level. While the law doesn’t clearly define what is reasonable, it prohibits repurchase prices from being “unconscionable”.

As you can see, there are a number of legal provisions with which you need to become familiar. This article is just an overview. But if you plan to dip your toe into the Florida pre foreclosure, foreclosure or short sale real estate markets, it’s important that you familiarize yourself with the process. You’ll also want to get your hands on a good list of Florida lis pendens filings. Default Research makes these list available at http://www.defaultresearch.com/shoppingCart/listing/state/fl.

Real estate professionals are no different than anyone else: they like to give appropriate holiday gifts to their employees. It’s important, however, that you give some thought to the types of gifts you give or you might face the wrath of your employees if the gift increases their tax burden.

The reason is simple: Uncle Sam views many of the gifts, perks, and freebies given by employers to their employees not as an expression of appreciation or goodwill, but as a taxable expression of appreciation or good will. Even something as simple as a gift certificate to a restaurant counts as income. Here are some examples of items that could be taxable to your employees – and alternatives that could hold at bay the outstretched hand of the taxman:

• Taxable restaurant gift certificates – alternative could be a tax-free holiday party for all employees
• Taxable cash bonuses – alternative could be gift cards or bonuses paid with check separate from payroll (still taxable but not quite as bad)
• Gift cards, checks, and other cash equivalents are taxable; inexpensive electronics, fruit baskets, and other food items normally are not

Toeing the line of government regulations might seem to be a lot of work, but it will keep your employees happy. The holidays can be stressful enough for your employees. Don’t add to their tax burden and give them a good reason to ring in the New Year with bad sentiments. Your employees will appreciate your efforts.

While your December to-do list might include holiday parties, quality time with family and friends, and the hustle and bustle of finding the perfect gift for that hard-to-shop-for person on your list, selling your property doesn’t normally make the cut. Maybe it should.

There are lots of good reasons to expect that your home could sell this holiday season:

• Your home looks its best during the holidays
• Other sellers are less amenable to showing their homes, which means fewer homes with which to compete
• Potential buyers are more emotional and may react more positively to your house – particularly if they have a more immediate need for housing
• Anyone looking for a home during the holidays is interested in much more than just checking out your interior decorating skills; they’re motivated to buy

While your home could sell more quickly during the holidays, you have to be vigilant to ensure that your home is best positioned to impress potential buyers:

• Ensure that your home is picture perfect for potential buyers
• Keep holiday decorations to a minimum – and keep all inflatable decorations of questionable taste tucked safely away in your garage
• If you feel the need to re-arrange furniture during the holidays, ensure that the new arrangement still highlights your home’s best features
• Avoid the temptation to go overboard with outdoor holiday lighting – or to cover an otherwise stunning front door with a massive wreath

Selling quickly during the holidays is possible, but it will take a little effort on your part. Enjoy the holiday season, but be smart about showing your house at this time of year. If you’re good, you might just get the best gift of all – a fast sale during the holidays.

Real estate loan rates have followed the same trend-lines for some time – with borrowing costs being higher for jumbo loans (loans in excess of $417,000 – more in some locations). The tide has turned, however, as money begins to creep back into the mortgage market.

Until about two years ago, conventional loan rates were about 1.5 percentage points less than jumbo loans; the gap is now about 0.7 percentage points.

Because of this, homeowners that are able to take advantage of these lower rates have the ability to save hundreds of dollars on their monthly mortgage payments – whether through refinancing or obtaining a new loan.

While rates have fallen, homeowners interested in refinancing their existing jumbo loans or taking out new ones haven’t flooded the market. Part of the blame can be placed squarely on the shoulders of the economy, with the rest of it being a general unease that many potential borrowers have about taking on new debt during uncertain times.