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Month: August 2011

Loan Modifications: What Are Your Las Vegas Homeowner Options?

Do you really love your Las Vegas home, yet are finding it harder and harder to make your mortgage payments? A home loan modification may help you keep your home by lowering your mortgage payment.

Getting your mortgage payment lowered could mean the difference between staying in your home and having to move. If you can’t make your mortgage payments and don’t get a loan modification, you’ll either have to short sale your home or the lender will foreclose.  If that happens, you’ll probably have to rent for at least a few years (both a short sale and a foreclosure will negatively impact your credit score).

So if your money is getting tight and fear that you may not be able to pay your mortgage (or if you’ve already missed mortgage payments), then you should at least consider a loan modification. Loan modifications are changes made to the terms of your mortgage such that your monthly payments are lower.

Here are three home loan modification options:

Option #1: MHAP (Making Home Affordable Program).  This is a federal program designed to help American homeowners keep their homes, by making changes to qualifying mortgages (the MHAP programs come with restrictions and you must qualify in order to participate). Under MHAP, there are five programs that you may qualify for:

  1. HAMP (Home Affordable Modification Program) can lower your payments so that they are no more than 31% percent of your pre-tax income.
  2. HARP (Home Affordable Refinance Program) can lower your interest rate (although refinancing fees do apply).
  3. 2MP (Second Lien Modification Program) can lower the principal balance on your second mortgage (if you modify your first mortgage through HAMP).
  4. HAFA (Home Affordable Foreclosure Alternatives Program) allows you to get out of your mortgage without fear of a deficiency judgment (which is when the lender comes after you for the difference between your mortgage balance and what the market value of your home). Participating lenders only have to consider you for HAFA but are not compelled to approve your short sale under this program. A successful short sale can still be negotiated outside of HAFA.
  5. HHF (Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets) can help you avoid foreclosure (especially if you’re under or unemployed).

Option #2: Interest rate reduction.  Even a relatively small change in your interest rate can lower your monthly payments dramatically, often by several hundred dollars a month (depending on your loan balance and interest rate of course). That can really add up over a year, and certainly over the life of your Las Vegas home mortgage.

Option #3: Loan balance reduction.  Unfortunately, loan balance reductions (also called loan forgiveness) – when the lender actually reduces the amount you owe on your mortgage – are rare.  If you can negotiate a loan balance reduction, though, it can have the same effect on your monthly mortgage payments as an interest rate reduction (reduce them) and also help you get back to positive equity.

If you’re having trouble affording your monthly mortgage payments, and a loan modification doesn’t work, another option is a Las Vegas short sale.  At Shelter Realty you can get cost-free advice regarding possible foreclosure alternatives. If you decide to do a short sale, we have the expert help you’ll need. Call us right now at (702)376-7379 or visit www.shelterrealty.com.

6 Tips for Finding the Perfect Las Vegas Neighborhood

The Las Vegas neighborhood you choose can have a big impact on your lifestyle.  Safety, available amenities, and convenience all play their part in your decision. So here are six tips to help choose your next Las Vegas neighborhood:

Tip #1: Make a list. Write down all of the activities (health club, church, volunteering, movies) that you engage in regularly as well as the places (school, work, family and friends’ homes) that you visit frequently. See how far you would have to travel from each neighborhood you’re considering in order to take part in your most common activities. Is the neighborhood convenient?

Tip #2: Check out the school district. On our website we have the most up-to-date school information: test scores, class size, percentage of students who attend college, and special enrichment programs. If you have school-age children, also consider paying a visit to schools in the neighborhoods you’re considering. Even if you don’t have children, a house in a good school district will be easier to sell in the future (statistics show that school districts impact home sales).

Tip# 3: Find out if the neighborhood is safe. Ask the local police department for neighborhood crime statistics (or check out the latest Las Vegas crime reports here). Consider not only the number of crimes but also the type – burglaries, armed robberies – and the trend of increasing or decreasing crime. Is crime centered in only one part of the neighborhood, such as near a retail area or more near homes?

Tip #4: Determine if the neighborhood is economically stable. Check with your local city economic development office (or better yet, your Shelter Realty agent) to see if income and property values in the neighborhood are stable or rising. What is the percentage of homes to apartments? Apartments don’t necessarily diminish value, but they do mean a more transient population. Do you see vacant businesses or homes that have been for sale for months? This could mean a declining neighborhood.

Tip #5: See if you’ll make money when it comes time to sell. Ask your Las Vegas real estate agent to get information about price appreciation trends in the Las Vegas neighborhood. Although past performance is no guarantee of future results, this information may give you a sense of how good an investment your home will be. Your Shelter Realty agent can also tell you about planned developments or other future changes in the neighborhood (like a new school or highway) that might affect your new home’s value.

Tip #6: See for yourself. Once you’ve narrowed your focus to two or three neighborhoods, go there and walk around. Take pictures and document what you see.  Are homes tidy and well maintained or are they in disrepair? Are streets quiet or busy with traffic? Pick a day (or time of day) that’s comfortable outside where you can walk and talk to neighbors in the area and see if the neighborhood gives a friendly feeling. A picture says a thousand words… but so do the neighbors.

Of course, our job as your Las Vegas real estate agents is to help you answer all of these questions as we work to find the Las Vegas home that is right for you.  Why go it alone, when you can have expert help? Call us now at (702) 376-7379 or contact us online.  You can also check out the Las Vegas neighborhood homes for sale.

Las Vegas Neighborhood Spotlight: Head for the Centennial Hills

There are currently 542 homes for sale in the Las Vegas 89149 zip code, which includes the master planned community of Centennial Hills. Centennial Hills is a newer master planned community located northwest of Las Vegas. Centennial Hills homes range in size from small single family houses (perfect for first-time home buyers) to mansions. Builders include Astoria Homes, Concordia Homes, KB Homes, Pardee Homes and Spinnaker.

Homes for sale in Las Vegas zip code 89149

According to public data records complied by Trulia, between May and July 2011, 631 homes sold at a median sales price of $119,995. That price is 11.8 percent lower from the same period (May-July) one year ago. In other words, if you’re looking to buy a home in Centennial Hills, now is a good time to get a great deal.

The median sales price of homes in the 89149 zip code (including Centennial Hills) was 4.16% higher than the median sales price for Las Vegas, NV (again, according to public data records complied by Trulia).

Neighborhood schools in Centennial Hills

There are a number of schools within the Centennial Hills 89149 zip code. Most of the public schools received ratings of 8 out of 10 from GreatSchools. Northwest Career & Technical Academy received the highest rating of a 10. That’s a big plus for owning a home in this desert community (even if you don’t have school-aged children, the quality of neighborhood schools do affect a home’s resale value).

Here’s a list of the schools in the Centennial Hills 89149 zip code area:

School name School type Grades GreatSchools rating (out of 10)
Dean Lamar Allen Elementary School Public PK – 5 8
Marshall Darnell Elementary School Public PK – 5 7
Sandra L ThompsonElementary School Public PK – 5 8
Edmundo Eddie Escobedo Middle Public 6 – 8 8
Centennial High School Public 8 – 12 6
Northwest Career & Technical Academy Public 9 – 12 10
Centennial Academy Private PK – 4 na

Source: GreatSchools.org

Things to do in and around Centennial Hills

Centennial Hills has a new 110-acre Town Center that claims to be “the largest regional park in the Las Vegas valley.” Town Center features include two dog parks, two lighted soccer fields, ten lighted volleyball courts, a water play area and numerous picnic areas. Convenient shopping, dining and entertainment venues are located at or near the 900,000-square foot Centennial Center.

If you want to be closer to nature (from golf to skiing and everything in between), your favorite activity is within 35 miles of Centennial Hills. You and your family can enjoy:

Painted Desert Golf Club: You’ll want to play your next round of golf at this desert-style 18-hole golf course. It was one of the first Las Vegas courses to embrace and use Nevada desert landscaping. Take your first swing with gorgeous mountain views as your backdrop.

Floyd Lamb State Park:  You’ll love this 680 acre desert oasis that’s teaming with wildlife, lush vegetation, lakes (great for fishing) and views of the Sheep and Spring Mountain Ranges – a far cry from the sights and sounds of the Vegas strip. While you’re there, stop in at the historic Tule Springs Ranch where you can learn about a traditional working ranch and early Las Vegas lifestyle.

Mount Charleston: Just 35 miles northwest of Las Vegas, there’s no reason why you can’t visit this alpine attraction during any season. Your eyes will feast on panoramic views of the Toiyabe National Forest – at 12,000 feet the mountain has the distinction of being the third-highest peak in Nevada. Mount Charleston is also home to a variety of campgrounds with some 180 campsites and 150 picnic areas.

Whether you’re looking to sell your Centennial Hills home or buy one there, the real estate experts at Shelter Realty can help.  Give us a call right now at (702) 376-7379 or you can view our Centennial Hills listings at www.ShelterRealty.com.

Recent Homes For Sale In Centennial Hills

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See all Homes For Sale In Centennial Hills.
(all data current as of 6/3/2020)

Listing information deemed reliable but not guaranteed. Read full disclaimer.

 
 

Shelter Realty Welcomes Atsuko Winston to the Team

I am thrilled to announce that Las Vegas real estate agent and property manager Atsuko Winston has joined the Shelter Realty team.

We are really excited to welcome Atsuko to the Shelter Realty family.  Fluent in Japanese and English, she brings invaluable expertise to our clients.  For eight years she has specialized in working with Japanese real estate investors (and others) looking to buy Las Vegas real estate.

Atsuko will also provide Shelter Realty’s professional property management services to our Japanese clients looking to invest in Las Vegas real estate.  Atsuko offers a truly complete real estate investment package for Japanese real estate investors.

To set up an appointment with Atsuko please call (702) 376-7379 or email her directly at atsuko @ shelterrealty.com.  To browse our listings of Las Vegas homes for sale visit www.ShelterRealty.com.

Don’t Get Trapped Because Nevada Allows Deficiency Judgments

If you’re facing the possibility of losing your Las Vegas home to foreclosure and wonder if your bank can come after you for the remaining balance of your mortgage… yes it can!

Nevada home loans are known as full recourse loans, meaning that lenders can pursue deficiency judgments against homeowners who default.  In other words, after a foreclosure your lender can sue you for the difference between what you owe on your mortgage and the price that the bank sells the home for.

When you got your mortgage, you used your Las Vegas home as collateral on the loan, meaning that the bank can take the home if you fail to uphold your end of the deal (pay your mortgage on time every month).  But in Nevada (the laws are different in every state) that’s not the only recourse the bank has if you fail to meet your obligation. . . the bank can also get a deficiency judgment against you for any deficiency between the mortgage balance and the value of the home (what it sold for).

And that difference may be a lot. If you have a mortgage of $400,000 and your Las Vegas home sells in a foreclosure sale for $200,000, your lender can obtain a deficiency judgment against you for $200,000 as long as the lender files suit within six months of the foreclosure sale.

What should you do if you think you might face a deficiency lawsuit?

Remember lawsuits are expensive – even for mortgage lenders. So, just because you may be facing a foreclosure doesn’t mean you’ll be sued for a deficiency judgment. The reality is that if you don’t have enough money to pay your mortgage, you probably don’t have any assets for your lender to go after (so the lender might not even try). In most cases, if you cornered a lender in secret, they’d probably tell you they would prefer to settle on a short sale rather than the risk the expensive path of foreclosure.

But even if it’s not likely (and how likely it is depends on a myriad of factors) that you are sued there’s a good chance you’ll lose to your lender if they go to the trouble. If awarded a deficiency judgment, your lender can garnish your wages (take money out of your paycheck) and place liens against any of your other properties (second home, boats, motorcycles). You may be able to work out a payment plan to pay your lender back.

A deficiency lawsuit can be a scary possibility for any Nevada homeowner.  If you’re struggling to pay your mortgage, selling your Las Vegas home may be the best option.  No matter your situation (even if you owe a lot more than your home is worth) we can help. Call us right now at (702)376-7379 or visit www.shelterrealty.com.

Disclaimer: Neither I nor my colleagues at Shelter Realty are attorneys. Nothing that we’ve written here or elsewhere on www.ShelterRealty.com should be construed as legal advice.  If you’re facing foreclosure in Nevada, you should consult with a legal professional.

Score High for Your New Las Vegas Home

What’s in a number? Your chances of getting your new Las Vegas dream home – that’s what! Your credit score can be the one thing that keeps you from owning your next home, so let’s look at how your score is determined and how you can keep (or get) your score up.

The whole point of a credit score is to offer lenders a quick and easy way to estimate the risk associated with lending you money.  If lending you money is riskier (because you’re more likely than someone else to default), the lender will charge you a higher interest rate to compensate for that higher risk (or will simply not lend to you at all).  The most commonly used credit scoring method is the FICO score.

Here are the five factors (and their relative importance) that determine your credit score:

#1: Payment history (35%). The payment history factor is fairly simple to understand: it takes into account how you’ve paid your bills.  After all, your history of debt repayment is an excellent indication of whether or not you’ll pay your future debts on time.  Payment history includes delinquencies, foreclosures, bankruptcies, as well as how many accounts were paid late, the amount(s) that were paid late, and how recent those delinquencies are.

#2: Amounts owed (30%). Almost as important as how you’ve paid your bills is the amount of debt you hold.  That’s because the more debt you hold, the riskier you’ll become – the more debt you have, the more likely it is that you’ll default on one or more of those debts.

#3: Length of credit history (15%). The longer you’ve had accounts open, the more debt repayment history there is for potential lenders to look at.  And the more on-time debt repayment history you have, the more confident your lender can be with your ability to repay your debts on time.  If you’ve just begun to establish your credit history, on the other hand, your lender has less “past behavior” to judge you on.

#4: New credit (10%). Research has shown that people who take out a lot of new credit at one time pose greater credit risks than those who have not taken out new credit lately.  The “new credit” factor incorporates, for example, the number of recently opened accounts you have in proportion to older accounts and the number of times you’ve recently applied for new credit.

#5: Types of credit used (10%). This factor considers the types of debt you have – installment debt (like a mortgage) and revolving debt (like credit cards).

Why does it matter? Your credit score will affect not only whether you’re able to qualify for a Las Vegas home mortgage, but also the rate you can get.  The following table is an example of how much less a person with a higher credit score might pay each month:

Source: MyFICO.com

On a 30-year fixed rate, $150,000 mortgage, a Las Vegas homeowner with the highest credit score would pay $150 less every month – and $54,133 less over 30 years – on their Las Vegas home than a homeowner with a fair (620-639) credit score.

At Shelter Realty, we understand numbers (like your FICO score, the price of your new home or your new zip code) and how important they are.  So call our agents today at (702) 376-7379 or visit us at www.shelterrealty.com and let us show you our numbers.

Before You Sign a Las Vegas Lease, You’ll Probably Be Screened. Here’s What to Expect

A tenant application is like applying for a job. Here, an applicant has to prove that they will be a good renter (pay on time, take care of the property, be considerate of neighbors). So how does a landlord (or the landlord’s property management company) know if they’ll be a good renter?  Same way a prospective employer would – by checking up on (and interviewing) the applicant.

At Shelter Realty, we have a 6-step Las Vegas tenant screening process that determines an applicants overall score.  Prospective renters must be cleared on all 6 steps and obtain a certain score before they can sign any lease.  Here’s what an applicant can expect during our tenant screening process:

Step 1: Credit check. Credit checks reveal the applicant’s financial history. We check to see if they have defaulted (failed to pay) on any loans (mortgage, car, school, etc…) or credit cards. If they have recent collections for utilities as this is an indicator that the applicant most likely won’t pay their rent on time.  If an eviction in the last 5 years is listed on their credit report, it’s an automatic denial.

Step 2: Criminal background check. We check to see if they have ever been arrested (any kind of criminal history may be a warning sign, especially felony arrests).  We want to protect our client’s property and the neighborhood.

Step 3: Employment verification. We check to make sure that the applicant is honest about their employment (and that they are in good standing at work). After all, a good employee usually makes a good tenant.

Step 4: Income verification. While a steady stream of income (employment) is critical, we also need to know how much an applicant makes – that they have enough income to cover the rent and their other expenses. We look at their current pay stubs and/or bank statements (factoring in additional obligations that take away from their income).

Step 5: Rental history verification. Does the applicant have a good history of paying on time or multiple late payments?  Did the applicant leave their last residence in good condition or was the landlord left with a large repair bill?

Step 6: One-on-one interview. We want to meet the applicant (usually in person, but on rare occurrences, over the phone) and get to know the applicant better than we could just based on the tenant application alone.  By meeting and discussing the results of the screening process, it allows us to verify the information obtained and sometimes discover discrepancies.

Of course, throughout the process we honor the fair housing laws and consider all of the information that we’ve been given.

At Shelter Realty, we have a full staff of property management professionals who can make the rental application process as smooth as possible. Call us today at (702) 376-7379 get started on the tenant application process or visit our website to see our huge selection of Las Vegas rental properties.

Your Las Vegas Short Sale Agent Can Be Your Lifesaver

You’ve come to the realization that you owe more on your Las Vegas house than it’s worth, so now what? You don’t want to foreclose (when the bank repossesses your home) but you want to get out of your house and mortgage. Short sales can be a viable option for you – but if you are unsure of the process, then it’s time we had a talk.

Working with a true short sale specialist (like Paul Rowe, the managing agent for the short sale division at Shelter Realty) is the one of the best ways to boost your chances of a successful short sale.  In fact, a real estate agent with proven experience with Las Vegas short sales can mean the difference between a successful short sale and a foreclosure (which is typically a far worse black mark on your credit than a short sale is).

When you find a short sale agent, you should have an open and honest conversation about what to expect. Will the short sale take one month, three months, nine months? You should ask as many questions as possible, because after all, you are the one who is drowning in your house.

As you consider whether to short sale your Las Vegas home, keep these three points in mind:

  • With the right short sale expert, your Las Vegas short sale doesn’t have to be painful.  (We can’t guarantee success, but we won’t make the process complicated).  A short sale is a complex transaction that demands a real estate agent with expertise and diligent follow up systems, and having personal relationships or internal connections with lending institutions are invaluable.  The right short sale agent will take care of those complexities; for the seller, the short sale process shouldn’t be difficult.
  • Patience is required. Once you’ve made the decision and started the short sale process, then you just have to wait. It can take at least 30-60 days to get your short sale approved – which we know seems like a long time. Sometimes, though, the process can drag on much longer, when the mortgage holder drags its feet. Because no two shorts sales are the same, times vary.

    While you wait for the short sale approval, this is the time when the process can feel really daunting. It can be frustrating not knowing the status of your mortgage – and that’s compounded when you don’t have good communication with your agent. It’s another reason having a great short sale agent is important.
  • A Las Vegas short sale specialist with proven success is invaluable. Why hire any agent when you could hire one who is in the top 5% of real estate listing agents in the nation with regards to short sale closings. A real estate agent who has been trained to know how to make the short sale as efficient as possible will make your life easier (some agents, like Paul, work exclusively with short sales and have perfected their process).

The Las Vegas real estate market, the economy, the banks, short sale rules, and laws governing short sales and foreclosures can change from week-to-week (or hour-by-hour), which is why it is important to work with real estate professionals who are experienced with short sales and who have the most up-to-date knowledge.

Let us get you out of your submerged house and onto dry land. To set an appointment with Shelter Realty’s Short Sale Genius, or simply to learn more about how our short sale process can be your lifesaver, call us today at (702) 376-7379 or visit www.shelterrealty.com.

Nevada Law AB373 Aimed at Homeowners Who Damage Homes Prior to Foreclosure/Short Sale

Nevada Law AB373 Aimed at Homeowners Who Damage Homes Prior to Foreclosure/Short Sale

The Nevada Legislature has taken steps against homeowners who deliberately damage their home prior to vacating the property during the period when the property is in default by criminalizing such behavior. After October 1, 2011 it will be a misdemeanor according to AB373. Persons can be subject to arrest and subsequent prosecution.

Owners may think they are getting back at the banks by taking this action but all they really do is hurt others. The banks are doing just fine. Who is really affected are the neighbors who see their properties decline even further when the home sells for less than it should. The next homeowner, who had nothing to do with the situation, can be affected for years if the damage inflicted by the previous homeowner leads to unnecessary maintenance breakdowns. Also, insurance premiums and mortgage rates can  also rise as the risk to loan in our area increases.

For any questions related to foreclosure and short sales, please contact Shelter Realty at 702-376-7379. You may also email us at info @ shelterrealty.com.

Las Vegas Neighborhood Spotlight: Everything Is Close By When You Live In Green Valley

There are currently 200 homes for sale in the Las Vegas 89014 zip code, which includes the master planned community of Green Valley. Green Valley is located primarily in Henderson (the southeastern part of Las Vegas). Development first began in 1978, so that means within its 8,000 acres, you can find every home style, from distinctive ‘70’s era homes all the way to new-build homes.

Green Valley is full of neighborhood parks and walking trails and has an outstanding array of shops, gourmet restaurants and retail services. Also, the community has some great resources like outdoor amphitheatres, public swim clubs, theaters, hospitals and baseball fields. In Green Valley, there is truly something for everyone.

Homes for sale in Las Vegas zip code 89014

According to public data records complied by Trulia, between April and June 2011, 944 homes sold at a median sales price of $124,000. That price is 13.6 percent lower than the second quarter (April-June) of 2010.  In other words, if you’re looking to buy a home in Green Valley, now is a good time to get a great deal.

In the second quarter of 2011, the median sales price of homes in the 89014 zip code (including Green Valley) was 16.22% lower than the median sales price for Henderson Nevada (again, according to public data records complied by Trulia).  With Green Valley homes costing less than other Henderson homes, now could be a great time to get a great deal.

Remember, though, that if you’re considering buying a new home in Green Valley – or anywhere in the Henderson/Las Vegas area, you can still benefit from the services of a professional real estate agent (who will, for one, help you negotiate the sales price with the home seller).

 

Neighborhood schools in Green Valley

There are a number of schools within the Green Valley master planned community itself.  Green Valley High School received a distinguished GreatSchools rating of 8 out of 10 and Green Valley has 6 private preschool options. That’s a big plus for owning a home in this desert community (even if you don’t have school-aged children, the quality of neighborhood schools do affect a home’s resale value).

Here is a list of the schools that serve Green Valley:

School name School type Grades GreatSchools rating (out of 10)
Harriet Treem Elementary School Public 2-5 6
Jim Thorpe Elementary School Public PK-12 na
Nate Mack Elementary School Public PK-5 6
Thurman White Middle School Public 6-8 7
Estes M McDoniel Elementary School  Public PK-5 7
Green Valley High School  Public 9-12 8
Green Valley Christian School  Private PK-10 na
A Montessori Childrens Academy Private K-3 na

 

Source: GreatSchools.org

Things to do in and around Green Valley

Easily-accessible attractions: Green Valley’s proximity to the Las Vegas valley makes it a convenient community to live in. It is home to The Green Valley Outdoor Sculpture Collection; one of the valley’s best-known public art displays that features works by local and nationally renowned artists. Green Valley also has the Black Mountain Recreation Center, the Whitney Ranch Aquatic Complex, the Lorin L. Williams Indoor Pool, Green Valley Library, and the Henderson Campus of the Community College of Southern Nevada.

If you want golf, a banquet room, or some history, then perhaps a visit to:

The Legacy Golf Club: This premier golf club was designed by the acclaimed golf course architect Arthur Hills. The Legacy Golf Club is an 18-hole, desert jewel highlighted by manicured playing conditions, multi-tiered fairways and large undulating greens. The Legacy Golf Club was selected by Golf Digest as one of the “Top 10 Courses You Can Play” in Nevada. 

WildHorse Golf Club: Wildhorse Golf Club (owned by the City of Henderson) is home to one of the toughest holes in Vegas as well as a great venue for golfers of all abilities. Originally built in 1959 and redesigned in 2004 by architects Brian Curley & Lee Schmidt, the course features several holes guarded by shimmering lakes. This public golf course also features a magnificent Grand Ballroom overlooking the golf course and is available for tournaments, banquets or weddings. Golf Digest rated the club as one of the “Best Places to Play.”

Clark County Heritage Museum: This Henderson museum is a 30-acre site that features a modern exhibit hall with a timeline exhibit about southern Nevada from pre-historic to modern times and a collection of restored historic buildings that depict daily life from different decades in Las Vegas, Boulder City, Henderson, and Goldfield. Also preserved are newspaper print shops, railroad depots and a real 1918 Union Pacific steam engine. Visitors can also gaze at mineral specimens found at a mining exhibit as well as walk through a resurrected ghost town and a half-mile nature trail.

If you’re interested in buying or renting a Green Valley home, or if you’re looking to sell your Green Valley home, give Shelter Realty a call today at 702-376-7379 or contact us here.  We have real estate agents ready to assist first time home buyers, investors, sellers, and renters.  (Also, click here to see a full listing of Green Valley homes for sale and rent.)

Las Vegas Foreclosure Home Buying 101: 5 Things Every Buyer Should Know

Las Vegas Foreclosure Home Buying 101: 5 Things Every Buyer Should Know

A large percentage of homes for sale in Las Vegas right now are foreclosed homes (also called REO or bank-owned, these are homes that the bank has foreclosed and now own). Often, savvy home buyers can purchase a foreclosed home for less than a comparable traditional sale. But when it comes to buying bank-owned homes, there are some important things to watch out for.

If you are looking to buy a foreclosed home – especially if you are a first-time foreclosure buyer – then there are 5 things you’ll need to consider before signing on the dotted line:

  1. Assemble your foreclosure home buying team.  You’ll want to hire a real estate agent who has experience with foreclosed homes, a title company, a reputable home inspector who has a good eye for problems, and a maybe real estate attorney (if your agent recommends one) who can help with any legal issues that may surface and protect you as a buyer.
  2. Be aware of what may be hiding (or missing). Remember that you are buying a home that the owner stopped paying for; it may have been neglected. A thorough home inspection is always important to reveal any problems with the property, but it is especially important when buying a foreclosed home.
  3. In our work with Las Vegas homebuyers we’ve seen it all – from bank-owned homes that were impeccably cared for to the end to those that the homeowners totally trashed.  Pay special attention to potential damage like holes in walls, damaged carpet, missing floor tiles, and broken windows.  Watch out also for missing or dysfunctional appliances (ranges, dishwashers, ceiling fans, just to name a few).
  4. Las Vegas bank-owned homes are typically sold as-is; meaning that even if the home inspection reveals damage, the bank typically won’t repair it. Still, have the home inspector document the damage and what he has recommended be repaired and/or replaced.  Then get an estimate of what those repairs and replacements will cost.  A good real estate agent can negotiate with the bank to at least determine that the sales price reflects the repair expenses you’ll have to incur.
  5. Clean the title.  There have been a number of lawsuits around the country by former homeowners who allege that their banks improperly foreclosed on their homes.  Even if those homeowners win their suits, it’s not likely that a judge would take away the property from a homeowner who purchased it from the bank.  But it raises the issue of “clean title.” A part of any home buying process, doing a thorough check to ensure that the title is free and clear is critical.

Another point to watch out for: sometimes there will be a lien (or liens) on the property, often from unpaid back taxes or homeowners association (HOA) fees. The bank might raise the price of the home to try and cover those liens, which must be paid before the home sale can be finalized.  This is another point on which an experienced Las Vegas REO real estate agent can really help.

  1. Get financed.  We always recommend getting at least a mortgage pre-approval before you start the REO home purchase process. That way, you’ll know how much you can afford. Remember to include the money you’ll have to spend on repairing the property when you calculate the sales price you can afford. Sometimes, banks will offer qualified buyers mortgage deals on the foreclosed properties they’re selling (as an extra incentive to get the property off the banks’ books).  Your real estate agent can help you negotiate this as well.
  2. Get fair market value. As always, you want to pay at or below fair market value for the home. That means you’re paying at or below what comparable homes (similar age and size in the same neighborhood) have sold for. Compare apples to apples, not apples to oranges ­– compare to other foreclosed home sales, not to traditional or even short sales. At Shelter Realty we have access to all the Las Vegas area home sales statistics, and we’ll make sure our offer is at or below fair market value.

If you’re thinking about buying a Las Vegas bank owned home – either to live in or as an investment property – Shelter Realty has the foreclosure expertise and the experience to help.  Call us today at (702) 376-7379.  To see the Las Vegas foreclosed homes currently for sale, visit www.shelterrealty.com.

The Las Vegas Short Sale Process: What Goes Into a “Short Sale Packet”?

Given that a large percentage of Las Vegas home sales (almost 22%) are short sales, I’d like to go over the Las Vegas short sale process.  In some ways, a short sale is a lot like a traditional sale – your real estate agent lists your home for sale, puts out the “For Sale” sign, markets it to his network, maybe even holds open houses.

But in many other important ways, a short sale is much different.  Those differences all center around the fact that the mortgage holder (bank) must approve the short sale (because, after all, you’re asking the bank to accept less than you owe as payoff on the mortgage).  Today, let’s focus on what is probably the most important set of documents you will provide your agent during the process: the short sale packet.

What is the short sale packet for?  The short sale packet is in essence your proof that a short sale is your only alternative to foreclosure.  That you either 1) cannot afford your mortgage payments and/or 2) have to move and can’t pay the difference between the sales price and what you owe.

What goes into the short sale packet?

  • Hardship letter.  As I wrote in Don’t Sell Las Vegas Short Sales Short, you’ll have to document some hardship – some reason you have to sell now and can’t cover the difference between the sales price and what you owe.  For many of our clients, the hardship was a job relocation (they had to move) or some event that made payments unaffordable (an adjustable rate mortgage reset, a job loss, medical bills, divorce, death of a spouse or co-borrower, failed business, etc.).  Explain why a short sale is your only alternative to foreclosure.
  • Financial worksheet.  If you’ve said in your hardship letter that you can no longer afford your mortgage payments, here’s where you prove it.  Or if you’ve said that you have to move for a new job and you can’t cover the difference between the mortgage balance and the sales price, here’s where you’ll prove that.  The financial worksheet will include much of the same information as a home loan application does – a full list of amounts and sources of income; a full list of expenditures (how much and where it goes); a full list of all of your assets (what you own and what it’s worth); and a full list of your liabilities (what you owe).  Be detailed – the bank is going to compare this information with what’s on your credit report, paystubs, bank statements, and tax returns.
  • Tax returns.  Provide copies of the last two years of 1040 tax returns for all borrowers.  The bank will use this information to verify the income you’ve reported (or to confirm if you’ve claimed a significant reduction in income).
  • Pay stubs.  One month’s worth of pay stubs from the employer(s) of all borrowers.  To verify your most current income.
  • Bank statements.  Two months’ worth of bank statements (from your primary checking or savings account).  As with the tax returns and pay stubs, the bank will use these to verify the information you’ve reported on the financial statement.

Shelter Realty provides their clients with complete packets: If all of the above items are sounding like a big hassle, don’t worry. Our clients are provided easy to follow instructions and pre-formatted documents the banks prefer to see. A short sale packet can be compiled in less than an hour. Our clients are also offered direct consultation to ensure completeness and answer any lingering questions prior to sending back their packets.

After I give it to you, what do you do with it?  When we receive an offer from a buyer, we take that offer, along with the short sale packet you completed, and send it to the short sale department at the bank.  A decision from the bank can then take anywhere from 30 days (or, in some cases, less) to 90 days or more.

If you’re considering a Las Vegas short sale, get the help of a real estate professional with proven short sale success.  That’s Shelter Realty – give us a call today at 702-376-7379 or contact us here.