Charlotte Real Estate, Foreclosures, Short Sales

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Welcome to Charlotte North Carolina's Real Estate Blog. Today's Real Estate & Auction specializes in residential home auctions for lenders, new home builders and home sellers across the Carolinas. 

We offer today's buyer up to the minute property information on the best deals available.  We offer today's seller a way to sell their home outside of the traditional listing method to create a competitive bidding environment among qualified buyers.

Our economy will continue to face hard times as the year progresses.  The economy lost 324,000 payroll jobs in the first five months of the year and the unemployment rate rose 0.5% during that time period.  The congress and the Administration have realized the seriousness of our housing situation and has been working on stimulus legislation aimed at helping existing and new home sales.

Will the Housing Stimulus Pass?

A temporary $8,000 tax credit for first-time home buyers could jump-start home sales and help to stabilize both house prices and mortgage credit quality. Other important provisions should provide relief for mortgage foreclosures and strengthen key components of the mortgage finance system to include FHA, Fannie Mae and Freddie Mac.

Sales of new homes fell by 2.5% in May, however sales of existing homes rose by 2.0% in May.  It's pretty clear that the rise is due to the strong sales of foreclosed properties.  The rise of foreclosed properties is making it harder for new home builders and existing homesellers to sell their home each month.  Lenders are beginning to release homes at fire-sale prices, making it even harder for builders and homesellers to get the attention of first-time homebuyers and investors.

Pricing Gap Still Wide for Charlotte Real Estate Area Home Sellers and Buyers

Charlotte area real estate agents are still working to close the pricing gap between home buyers and sellers.  While there are some sellers still not wanting to budge on price during this change in our housing market, some home sellers are very motivated and are looking to negotiate deep discounts because they must sell.

Below are graphical snapshots of existing and new home sales:

If you are looking for a great deal from a Charlotte area builder, view these homes below:

If you are looking for a great deal in purchasing an existing home from a motivated seller in the Charlotte real estate and surrounding areas, view homes below.

The Pick-A-Pay Loan. The Good, Bad and Ugly

Pick-a-payment loans can be high risk for some home buyers and a great way to manage cash flow for others. Pick-a-pay loans can potentially become negative amortization loans. Another name for these type loans are "Option Arms".
A Pick-a-Payment loan is designed to give the homeowner control over their mortgage payment. It consists of 4 different ways to make your payment:
Minimum Payment
Interest Only - The homeowner can defer making payment on the principal of the loan.
Full Amortization - Principal and interest payment based on a 15 or 30-year payment schedule.
15 Year Payment Option

Important questions to ask the lender include:

1. How long is the initial start rate fixed for?
2. What type of Index is used for the initial rate?
COFI - Cost of Funds Index. The index represents a weighted average cost of funds and includes long-term accounts.
Because it is an average, it doesn't move very fast. This protects the interest rate of a COFI loan from fluctuating
quickly.

CODI - Certificate of Deposit Index - A CODI loan is based on one of the most stable indexes currently available. It is
the aggregate sum of what banks are paying to their depositors on their 3-month CD accounts
MTA - Monthly Treasury Index. The MTA is relatively slow moving index based on the 12 month average of the
monthly average yields on U.S.Treasury Securities adjusted to a constant maturity of one year.

3. What is the margin?  Margin Plus Index Equals Fully Indexed Rate.

4. Is there a pre-payment penalty?

The flexibility of this type of loan can often get people into trouble.  Negative amortization can occur when a lot of minimum payments are paid and the loan amount increases.  Some studies have suggested that more than half of option ARMs borrowers are making only the minimum payments, says Glenn Costello, managing director for Fitch Ratings, a debt-rating agency.

In markets of declining home values and with the commission charged to sell your home, a homeowner can be forced to bring money to the closing table to sell a home with an Option Arm.   It can also be a precursor to foreclosure for homeowners unable to handle rising indexes associated with the mortgage

Wachovia's Fixed Payment Option

Wachovia Mortgage and World Savings have teamed up to offer a fixed payment option.  You can enjoy the flexibility of choosing a different payment each month while also having the option to enjoy the predictability of a fixed mortgage.  The homeowner needs to fully understand the repercussions of alternating between the different types of payments and how it will ultimately affect your bottom line.

When you hear the word 'auction' thoughts of foreclosures and distressed properties usually appear in many heads.  Strange enough, auctions are the primary way of selling real estate in many countries.  When you think about it, who wants to sign an open-ended contract with a real estate professional who you do not know THAT well or a 120-180 day contract to sell your home.  Yes, that also means 180 days of last minute showing requests, move the dogs to the laundry room or better yet, make them a new home in the garage, pass by your sign when you pull into your driveway for 6 months, have the Realtor say,  "it's the market, it's the market...let's do a price reduction", have your neighbors think your house must look like crap, or lose equity each day your home stays on the market while the foreclosure rate increases.  In my opinion, many media groups like CNN constantly  create a fear-mongering situation for today's buyer.  It ultimately keeps the number of home buyers out of the market. Why are we so far behind in innovative methods?  You know, people still equate real estate with those yellow bee colored jackets. :)

Auctions are an Answer For Many Homeowers

University East Business Park Development; a great piece of Charlotte Real estate, auctioned off the remaining space recently in an auction.  At the beginning of the year, 73 percent of the park was sold.  There were 11 land sites and three office condos remaining.  They collectively totalled 30 acres.  Merrified Partners projected they would not sell the rest of the park until 2012 using the traditional list and sell method.  However, on the day of auction, with 40 bidders ready to purchase, the auction generated more than $2 million in sales in one day. Land sales were as high as $87,000 per acre and condo sales were as high as $110.00 per square foot.

If you are interested in knowing how home auctions can sell your home at top dollar during a changing economy, FAST complete a home valuation request and a representative will assess your situation within 24 hours.

Homeowners are finding new ways to fight foreclosure. The newest way may provide a way out for 4 to 5 out of 10 homeowners facing foreclosure. According to Associate Professor of University of Iowa, Katherine Porter a study shows that banks are failing to attach the promissory notes to the file over 40% of the time. When a bank files for foreclosure, they are also in some cases filing to retrieve the lost instrument, promissory note as well. A homeowner facing foreclosure needs to watch for this filing at the courthouse.  Charlotte real estate lost instrument filings are easy to find. If the lender can't show proof that the homeowner is supposed to pay the mortgage, they can't foreclose. Last November, a judge stopped the foreclosure of 14 homes against Deutsche bank until they can produce the promissory notes. These homes are still in limbo and the homeowners are still in their homes.

Make the Lender Produce the Note
If the lender can't produce the note, how can they foreclose on your home.  Charlotte real estate homeowners facing tough times with limited funds need to find ways to fight harder for their homes. Homeowners are not asking the right questions and demanding negotiations. Some are simply walking away from their homes and abandoning the property and equity they may have in their homes. If a lender has to produce the note, this can hold up a foreclosure for months. In many cases, the homeowner will need to find legal counsel to assist. Fannie Mae has now changed their underwriting guidelines to five years seasoning after a foreclosure before a buyer can purchase again. This alone is worth fighting a foreclosure.

Great Website for All Consumer Scams, Frauds, Bewares....
I stumbled upon a great site filled with consumer warnings ran by a florida attorney. The site, Consumer Warning Network was provides consumers with information on bad deals, consumer alerts, bank schemes, business misrepresentations, and credit card company wrong-doings. It's a great site to update to get up to date recall information on products, vehicles, even student loan information and federal changes.

If you are facing foreclosure in Charlotte or own real estate in another city or state, there are a few organizations available to provide free assistance should you not be able to afford an attorney. The Homeownership Preservation Foundation is a non-profit organization of HUD-approved counselors to help homeowners facing foreclosure.