Effects on Credit Scores
Many people know that things like bankruptcy and foreclosure can cause heavy damage to a credit score, but a recent FICO-led study found that seemingly small things can have detrimental effects on credit scores also.
Lenders use credit scores to measure how well a person handles debt, and decide interest rates on loans—or even whether to issue a loan. The scores range from 300 to 850, with 650 and below considered poor credit. A good credit score is important not just for financing home purchases, but employers increasingly check credit as well as landlords when seeking rentals. Also, poor credit scores can also mean higher costs on car loans and credit cards.
For this study conducted in March, 2011, FICO, the most prominent public company providing credit-scoring services, and VantageScore, a new credit-scoring model, looked at three circumstances experienced by three types of mortgage holders — a borrower with a great credit score (780), a borrower with good credit (720), and a poor credit borrower.
A mortgage, the biggest loan most people will ever get, often is the most important part of a person’s credit profile. Among other things, the study as reported on Realtor.org found that just one missed mortgage payment can hurt credit scores significantly. For instance, a 780 credit score borrower saw her credit score fall to 670-690; a 720 credit score borrower’s fell to 630-650; and a 680 credit score borrower falls to 600-620.
Conversely, loan modifications, when lenders approve new loan terms, have a “very, very minimal” impact to credit scores, possibly dropping the borrower’s score by 10 or 15 points, according to FICO officials. The effects on credit scores caused by short sales and foreclosures also were looked at.
In the case of short sale, deed in lieu of foreclosure, or settlement, assuming the balance has been wiped out: The 780 credit score borrower falls to 655-675; the 720 credit score falls to 605-625; and the 680 credit score drops to 610-630.
In the case of foreclosure, or short sale with a deficiency balance owed: The 780 credit score drops to 620-640; the 720 credit score falls to 570-590; and the 680 credit score decreases to 575-595.
These effects on credit scores can be repaired, but in the meantime, they can be costly, so it is wise to monitor your credit score.
Alexandria Pope
Another great real estate professional has joined the OwnACondo.com team: Broker associate Alexandria Pope.
Alexandria is a condo-specialist Realtor® with OwnACondo.com and she serves buyers and sellers with knowledge and care that can’t be matched by a real estate generalist. Her enthusiasm, experience and specific training in the condo market and lifestyle means that she can provide highly focused information and services that consumers demand and deserve.
From the beginning of her real estate career in 2003, Alexandria has been devoted to upholding the industry standard of C.O.A.L.D. for her clients: Care, Obedience, Accountability, Loyalty and Disclosure. And while there probably isn't a real estate agent out there who wouldn't claim the same, with Alexandria it's different. A new acquaintance can sense her energy and passion for real estate and for her clients within the first minute or two of beginning a conversation.
Alexandria Pope's journey into a real estate career started when she decided she needed to educate herself, her family, her friends and even her community at large about several things real estate-related, including first time homeownership.
"I knew a lot of renters who should have been home owners, but they didn't have the tools" she recalls. "I also found that a lot of people simply didn't trust real estate agents. I wanted to stand up for what a true Realtor® should stand for."
Alexandria's specialties include:
- Chicago Real Estate
- Condos
- Townhomes
- First-time homebuyers
- Real estate investing
- Real estate investors
- Real estate auctions
- Leasing
- Rentals
- Foreclosures
- REO
- Short sales
- Condo financing
- Downtown Chicago real estate
- Chicago North real estate
- Chicago South real estate
Alexandria earned a master's degree in inner city studies from Northeastern Illinois University and a bachelor's degree in African American studies from Chicago State University. She's the proud mother of a three-year-old daughter and a 19-year-old son. Her son currently attends college in Arkansas, where he is studying business.
When not busy with her real estate clients, Alexandria enjoys poetry, youth mentoring and community activism. She also assists graduate-level university students with preparation for their master's thesis.
Contact Alexandria Pope via email at apope@ownacondo.com or via her a call at 773-407-4018.
Lizzette Jimenez
Lizzette Jimenez--condo owner, real estate investor and first-time homebuyer specialist-- joins the growing team at OwnACondo.com.
Fluent in English and Spanish, Lizzette’s story of how she chose OwnACondo.com is a good one, and one we’ve heard before.
“I had a great experience with one of the OwnACondo.com agents,” says Lizzette, who purchased two investment condos at a complex exclusively represented by OwnACondo.com. The service she received was obviously well-remembered.
Lizzette has 10 years of experience as a licensed real estate sales associate and is encouraged by signs the market is again warming up. She says that she decided to pursue a career in real estate because the experience she had purchasing her first condo at age 21 wasn’t particularly easy.
“I felt completely lost in the process when I was a first-time home buyer,” Lizzette explains. “I decided I had to go out and educate myself.” This led to her decision to become a real estate agent and now Lizzette loves sharing her knowledge and experience with people who are in the same position as she once found herself.
“Working with first-time buyers is so much more rewarding,” she says. “There’s so much more help I can provide.”
Lizzette Jimenez's specialties include:
- Suburban Chicago Real Estate
- DuPage County real estate
- Condos
- Townhomes
- Real Estate Investing
- Real Estate Investors
- Real Estate Auctions
- Leasing
- Rentals
- Foreclosures
- REO
- Short Sales
- Condo Financing
Lizzette moved up from that first condo she purchased at age 21 to a spacious townhome where she now lives with her husband and young daughter. Lizzette enjoys yoga, fitness, international traveling and she’s also an avid reader; although with the demands of a two-year-old child, she admits with a laugh “I’m lucky I can even fit in my industry-related reading these days!”
Lizzette currently serves on her townhome association board of directors. She knows first-time home buying, condos, townhomes and real estate investing—in short, she’s a perfect addition to the team at OwnACondo.com, the best place to buy and sell condos! Contact Lizzette Jimenez, an English- and Spanish-speaking real estate agent, at: ljimenez@ownacondo.com
Marie Waxton
OwnACondo.com welcomes Marie Waxton to its growing team of licensed real estate sales professionals. She is highly buyer-focused and dedicated to helping people find their dream residence.
Marie enjoys dissecting all the details that make up any particular property. "Real estate is usually the biggest investment people make. I like to make sure it's what they want and that it will fulfill their dreams," she says.
Her real estate career began in 2006 and Marie toured unique (and sometimes historic) buildings in Chicago, researching programs for their restoration. She worked with banks, making sure financing was available for these unique properties.
Highly personable and enthusiastic about Chicago and its people, Maries Waxton says without hesitation "I have a love affair with the city. I enjoy the lake, the zoo, the skyline, museums and jazz clubs." Marie originally hailed from Northwest Indiana and now resides in Chicago's Southwest suburbs.
Marie's specialties include:
- Chicago-area real estate
- Dupage County real estate
- Condos
- Townhomes
- First-time homebuyers
- Real estate investing
- Real estate investors
- Real estate auctions
- Leasing
- Rentals
- Foreclosures
- REOs
- Short sales
- Condo financing
Marie earned a degree in education and journalism from the University of Indiana, Bloomington. She encourages buyers to check out OwnACondo.com's easy condo search and to contact her at mwaxton@ownacondo.com for any information related to condos, townhomes, financing or real estate in general. Marie Waxton continues OwnACondo.com's long tradition of expert, dedicated and customer-centric service that consumers love!
OwnACondo.com finds a Discovery
Discovery, the world's most traveled spaceship, went into orbit for the final time Thursday, heading toward the International Space Station on a journey that marks the beginning of the end of the shuttle era. This is quite a similar journey for OwnACondo.com, which is marking the end of its long-time residence in Oak Brook, Illinois as brand new offices are being prepared at 540 N. Lake Shore Drive in Chicago.
This "discovery" of a new home and appears to be a perfect fit at the perfect time. It is a buyers’ market, plain and simple, so we need to captialize on that and work to help these buyers find the perfect deal. There are deals everywhere but it may be challenging for consumers to find them, so it is a good idea to have a real estate agent assist you with your search, especially if you are interested in short sales and foreclosures. Real estate agents can assist you with auctions which contain foreclosures and bank owned properties.
RealEstateAuctions.com is a great place to purchase or sell bank owned properties for auction. The specialists there can assist you with any questions that you have about the auction process. Auctions are becoming very prominent in this market, because there are a lot of bank owned properties that need to be sold. If you are in a position to purchase property, now is the time. The agents at OwnACondo.com can assist you with traditional real estate buying and selling, and the agents at RealEstateAuctions.com can assist you with purchasing and/or selling at auctions. It looks as though this disovery is worth looking into!
Tracenda Stenhouse
Tracenda Stenhouse has joined the growing team of Realtors® at OwnACondo.com.
Traycee, as she is known, brings four years of real estate experience to her new position, in addition to 14 years of sales and customer service experience.
“I like the hustle and bustle of the real estate business, of taking people out to find just the right property, and then negotiating to get the best deal possible. As I tell my clients, "I listen to what you want, and then I find it. It is out there.”
The Frankfort resident, who enjoys spending time at home with her four-month-old daughter when she is not working, studied business at the University of Illinois at Urbana-Champaign, as well as Illinois State University and DePaul University.
“I have been a real estate agent for four years, and have a total of 14 years of experience in customer service and sales. Before finding real estate, I worked for several companies as a salesperson and as a customer service manager,” said Traycee. Prior to coming to OwnACondo.com, she worked for Richmond Partners GMAC, Zip Realty and Century 21 Pro-Team.
“I like how OwnACondo.com is dedicated to its clients and its employees. Being an exclusive buyers’ agency is something else that drew me here,” Traycee added.
Tracenda Stenhouse’s real estate specialties include:
- Condos
- First-time homebuyers
- Short sales
- REOs
- Foreclosures
- Chicago South
- Chicago North
- Downtown Chicago real estate
- South Cook County
- Frankfort real estate
- DuPage County real estate
- Will County real estate
- Downtown Chicago real estate
In addition to spending time with her newborn daughter, Traycee's many interests include traveling, shopping and helping with the homeless outreach program at her church.
If you would have questions or would like Tracenda Stenhouse to help you find your dream home or investment property, contact her at Tstenhouse@ownacondo.com or at (708) 601-2304.
Quicker Response to Short Sale Requests
Homeowners who are underwater with their mortgage may find that relief is on the way from a bill strongly supported by the National Association of Realtors® that would impose a deadline on lenders to make a quicker response to short sale requests.
The legislation, H.R. 6133, “Prompt Decision for Qualification of Short Sale Act of 2010,” was Sept. 15 in Congress by U.S. Reps. Robert Andrews (D-N.J.) and Tom Rooney (R-Fla.). The bill would require lenders to respond to consumer short sale requests within 45 days.
“The short sale, which requires lender approval, is an important instrument for homeowners who owe more than their home is worth,” said NAR President Vicki Cox Golder. “While the lending community has worked to improve the size and training of their short sales staffs, they still have a long way to go on improving response times.”
Consumers seek to sell their real estate "short,” or for less than what is currently owed, due to a variety of reasons. These reasons can include loss of wages and the inability to pay; declining property value that makes their home no longer worth what the paid or what is owed; the need to move during a declining economy, plus others. Lender approval is needed for a short sale but the backlog of requests has meant very long decision times, which can hamper or ultimately defeat the purpose.
“As the leading advocate for homeownership issues, NAR believes that quicker attention to the short sales process is vital to help homeowners who are underwater and their communities, as well as the nation’s economy,” said Golder.
The number of potential short sale properties is rising across the country, in part due to the lack of a quicker response to short sale requests. According to NAR data, in the second quarter of 2010, Nevada, California, Florida and Arizona are states where significant shares of all properties on the market are potential short sales: 32 percent, 28 percent, 27 percent and 24 percent, respectively.
“Unfortunately, homeowners who need to execute a short sale are severely hampered because lenders (loan servicers) are unable to decide whether to approve a short sale within a reasonable amount of time. Potential homebuyers are walking away from purchasing short sale property because the lender has taken many months and still not responded to their request for an approval of a proposed short sale price. Many consumers have mentioned that the delay in short sale price approval exceeds 90 days, and in many cases never arrives,” Golder said.
Watch this space for news of how the Congressional legislation for quicker response to short sale requests will be voted upon.
What is Virtual Staging?
Virtual staging is a new innovative idea for all of the vacant homes on the market. Short sales and forecloses are slowly dominating the market, and most of these types of properties are vacant. Every property needs to look its best, even vacant properties. It is to no surprise that staging can actually sell a home faster than it normally would had it been a clean slate or even over cluttered; however, not everyone can afford to stage their home. To professionally stage a home, it can cost anywhere from a few hundred dollars to more than one thousand dollars. It is even more expensive to stage vacant properties because of the expense of the furniture rentals.
This is the reason why many Realtors are turning to virtual staging. What is virtual staging you may ask? Virtual staging is using computer technology to add furniture and other decor to the photos of their listings. This is an economical, inexpensive way to really show the potential of a vacant property. The average cost for virtual staging is approximately $225.00. In today’s market, because of the high amount of inventory, many people narrow their choices based on the online photos they see, so this small amount of money is well worth it.
Now there are different programs that are better than others, so it is very important to do your research to see which software offers the best product at the best cost. You can also use this product for your own home if you looking to remodel. There are programs that allow you to change wall colors, countertop textures, and type of flooring!
If you are going to use a virtual staging program, than it is important to make sure that you keep it ethical. The whole idea of virtual staging is not to deceive prospects but rather to help them envision what the home can look like if there were furniture in the space. Each agent needs to clearly state that the images are computer generated. In other words, where the virtually staged photos appear, you should include a small blub that the property has been virtually staged and that the property is actually vacant. Otherwise you risk violating the code of ethics, which states that you need to portray a true picture. As long as you set the right expectation for the prospective buyers then they will know what to expect when they walk in the home... a vacant unfurnished home!
Condo Investments
You want to invest in condos but you're not sure where to begin. This article may be of help. Condo investments right now can be unbelievable. The prices have been dramatically cut from the run of the early twenty hundreds. Prices have come down more than twenty-five percent in many areas of the United States, but down further in others. On top of that, there's a second level of discounts from people that are in a distress situation. Short sale condos and foreclosed condos are rampant everywhere.
Where do you start to look for the condo investments? Your due diligence should start by talking to the professionals. The condo realtor is a must along with real estate property managers. These professionals will walk you though the process of buying, managing and selling the condo. I'd suggest a meeting with three companies in each of the categories. After six meetings, you'll have so much information about the market place that it will become evident on how to get started almost immediately.
There have been about eight major markets to really get hit with depreciation including the Chicago condo market. Condos that were once going for $150,000 are now selling at $110,000. The $500,000 condo is down under $400k. What's the next move? There may be another level of depreciation but it can't be far from the bottom. The level of activity in the real estate market right now is hot. There are a number of transactions going on and with the $8,000 tax incentive program, the pace looks like it will do nothing but pick up over the next three months. We may have bottomed out but no one really knows.
The deals are so low now that whether it goes a level below this or not, the condo investments just make sense. Make sure to get a good condo attorney that understands association law. That will make a big difference in the end if you see a deal that you want to go forward with. Your attorney will guide you through this process of buying your condo from a whole different perspective. The attorney will analyze how an association is doing or if there are special assessments that will cause an increase in monthly fees.Â
If you want to move forward on a condo investment make sure you pick the right team to help you through it. The real estate agent, the manager and the attorney.
