Kristina 's Blog

Banks need to Negotiate foreclosures with the Homeowners through the Courts

Kristina Rosen-Hester (TNT Realty & Associates) — Wed, 19 Aug 2009 15:46:04 -0700

With the increasing number of foreclosures, vacant homes are tremendous. The worst of it all is the homeowners losing their homes are willing to work out and negotiate with the bank to keep their homes. If the banks are forced to go to mediation, it will delay or alleviate foreclosures.

Help for Small Businesses

Kristina Rosen-Hester (TNT Realty & Associates) — Mon, 15 Jun 2009 20:56:13 -0700

Articles » Money & financing » Greatly helpful 8.5 out of 10 19 votes

Update on the American Recovery and Reinvestment Act: Help for Small Businesses

Here's a summary of the American Recovery and Reinvestment Act's programs specifically targeted to small businesses (as defined by the SBA) and the banks that lend to them.

Written Apr 27, 2009, read 2222 times since then.

We've all read about the bail outs for big banks and big businesses over the last several months. Now, the current administration has launched a series of programs specifically targeted to small businesses (as defined by the SBA) and the banks that lend to them.

The goal of the program, part of the American Recovery and Reinvestment Act, is to provide entrepreneurs and lenders some financial relief from the current economic crisis that will help encourage borrowing and lending to all small business, including start-ups. It also provides a new program to help businesses that are struggling to make payments on an existing loan.

This loan program, called the America's Recovery Capital (ARC) will soon offer deferred-payment loans of up to $35,000 backed 100 percent by SBA to viable small businesses that need help making payments on an existing, qualifying loan for up to six months. (Note: the existing loan does not have to be a SBA loan to qualify.) Repayment does not begin until 12 months after the loan is fully disbursed and will be for the principal amount only. (ARC loans cannot be made to cover payments on an existing loan that was guaranteed by SBA before February 17, 2009, the day the bill was signed into law.) As of this writing, the final details on the ARC were still being worked out and the loans were not yet available. Check with your local bank or SBA Website to find out when these loans will be available.

The other part of the program involves up to $15 billion from the Treasury Department to unlock the secondary markets for small business loans. The secondary markets for 7(a) and first lien 504 securities has ground to a virtual halt over the last year. That, in turn, has made banks less willing to make the loans as they depend on these secondary markets to buy up their existing loans, thereby gaining liquidity for future lending. The government has now announced that the government will stand ready to purchase 7(a) and 504 first-lien securities. The goal is to encourage banks to make loans as they now have a ready buyer in the form of the Treasury Department committed to buy those loans from the bank once they are made.

In addition, to the above programs, the Act also includes:

Temporary elimination of 7(a) and 504 loan fees. Fees for a 7(a) loan are based only on the guaranteed portion of the loan and depend on the size of the loan. Fees range from 2% to 3.75%. Fees for 504 loans generally run about 1.5% for the application fee. This, along with the fee to the mortgage lender, will be waived.

Also under "discussion" is the allowance for allowing some use of 504 funds restructuring of existing debt that was previously used to acquire fixed assets. Further guidance regarding this provision is expected to be released soon.

The SBA formally guaranteed participating banks 75-85% of their portion of 7a loan funds. They have now raised this guarantee to 90%, again in an attempt to decrease the risk to a participating bank and encourage lending to small businesses.

This increased guarantee and loan fee waivers are good through the end of 2009 or until the designated funds for them are exhausted.

The Recovery Act includes other initiatives to help business owners with under $15 million in gross receipts, including targeted tax relief. If you experienced a loss in 2008, you can "carryback" this loss for up to the previous five years to receive a tax refund for taxes previously paid on your profits. Previous carrybacks were limited to two years. If, after applying this carryback to previous years you still have a net operating loss (nol), you can carry it forward for up to 20 years. This new extension applies only to businesses that have gross receipts of $15 million or less.

New extensions on depreciation rules allow you to accelerate depreciation taken on new assets purchased in 08 and 09.

Last year, lawmakers allowed businesses to recover the costs of capital expenditures made in 2008 faster than the ordinary depreciation schedule would allow by permitting these businesses to immediately write-off 50 percent of the cost of depreciable property, such as equipment, tractors, wind turbines, solar panels and computers acquired in 2008. Increase deductions mean less taxable profits to your business.

The new rules extend this 50 percent bonus depreciation allowed for property with a recovery period of 20 years or less for 2009.

In addition, Code Section 179 which allows for accelerated depreciation for used or new assets, has been increased from $125K to $250K.

Unlike Code Section 179, depreciation expensing that is available for new or used property, bonus depreciation is available only for new property or equipment.

Just remember, the more you increase depreciation for 09, the less you'll have available for future years. Contact your CPA or tax accountant about how these new provisions might allow you to decrease your taxable income for 09.

To find out more about these programs, visit:

SBA website at:

http://www.sba.gov/recovery/index.html

You can contact your local SBA District Office to obtain a list of SBA-participating lenders in your area at:

http://www.sba.gov/localresources/index.html

Your local Small Business Development Center (SBDC). Partially funded through the SBA and your state, these offices offer free counseling and research to small businesses. They also are knowledgeable about other resources in your area and can connect you to other service provides and possible financing sources. To find your local SBDC office, go to your favorite search engine and type in SBDC and the name of your state.

Specifically for Seattle Area:

In addition to the above resources, here are some specific agencies that provide assistance to Washington businesses:

Community Capital Development

www.seattleccd.com

Enterprise Seattle

www.enterpriseSeattle.org

Washington State Procurement Technical Assistance Center

www.washingtonptac.org

Lauren is Principal of Lauren Owen, LLC. She works with Families in Business who want to develop and execute their succession planning, improve productivity, strengthen their relationships, and create long-lasting value.

Real Estate Professionals Arrested in Mortgage Fraud Scheme

Kristina Rosen-Hester (TNT Realty & Associates) — Sat, 13 Jun 2009 20:14:38 -0700

Unbelievable! This is a crime i hope does not repeat itself. Homeowners are hurt enough by the banks, arent they? We work to help homeowners while also helping the banks when we short sell or modify a loan for a homeowner. It gives great satisfaction when by word of mouth a new customer calls to have us list and sell his home because he knew of someone or saw how we work with the sellers, the buyers and the banks.

Via Jason Rose (123 ConEd LLC -- online real estate continuing education):

Here is another example of a recent legal case involving mortgage fraud. I try to post case summaries in order to provide timely updates to real estate professionals on important issues.

On June 3, 2009, five people were arrested for their roles in a mortgage fraud scheme in the Washington State that bilked banks and property sellers out of more than $18 million. The arrests came as a result of an extensive investigation by United States Immigration and Customs Enforcement (“ICE”).

Humerto A. Reyes-Rodriguez, Alexis Ikilikyan, Micki S. Thompson, Mario Marroquin, and William S. Poff were indicted by a federal grand jury last month on charges of money laundering and conspiracy to commit bank and wire fraud (they were arrested on June 3, 2009). The indictment alleges that over a three-year period starting in 2004, they were responsible for 80 fraudulent loan transactions in communities throughout King County and Pierce County, Washington.

Mr. Reyes-Rodriguez and Ms. Ikilikyan were licensed real estate agents and mortgage loan originators. Mr. Poff is Ms. Ikilikyan's ex-husband and was a licensed notary and loan originator. Mr. Thompson was employed by Great American Escrow and acted as the closing officer for many of the fraudulent sales. Mr. Marroquin acted as a straw buyer and oversaw fictitious home repair companies.

According to court documents, the five defendants worked together to obtain financing from banks to purchase homes. At the same time, they convinced innocent home sellers to extend private loans to the buyer of the home to cover a portion of the purchase price.

The sellers did not know that the conspirators had already obtained financing from commercial lenders to cover the full cost of the home. When payments were not made, the properties fell into foreclosure. The homes were then sold for less than the total of all loans secured for the property. The sellers who had extended private loans to the buyers were left with nothing.

The conspirators also used straw buyers to purchase and resell properties and then submitted false information to the banks such as employment, income, citizenship status, assets and liabilities. They submitted bogus appraisals and hired fictitious home repair companies to do repair work on the properties. Proceeds from the home sales would go to the fake companies that had, in fact, done no work.

This case uncovered a group of real estate professionals who manipulated home sales for pure profit while some of the properties went into foreclosure and innocent private citizens were defrauded.

The conspiracy and money laundering charges are punishable by up to 20 years in prison and a $1 million fine. An indictment is merely a formal charge by the grand jury. Each defendant is presumed innocent unless and until proven guilty in court.

I will try to keep following this case and post an update when the case is ultimately resolved, hopefully with all of the defendants getting long prison sentences.

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To learn more about a variety of real estate topics, please visit us at www.123ConEd.com. We are the leading online provider of Michigan real estate continuing education. All of our courses are fully approved and properly certified by the State of Michigan, and are offered online.

Copyright © 123 ConEd LLC 2009. All rights reserved.

TO THE BANKS..... "TAKE THE MONEY AND RUN" DON'T WASTE MONEY AND TIME

Kristina Rosen-Hester (TNT Realty & Associates) — Wed, 14 Jan 2009 18:22:18 -0800

We tell the banks to take the money and run in this market. With so many short sales and foreclosures the banks are overwhelmed. If we get a buyer, write up a contract for something close to list price and the buyer has a preapproval for financing or cash, then why not take it? Banks are losing more money by counter offering for $5,000 more than the offer. How ridiculous this actually is. Here's why; If the banks counter an offer and the buyer walks, then we continue to market the property and show it in hopes of finding a new buyer. It could take, and usually does, 6 more months before another contract comes in. The bank has to pay all the taxes and insurance and any hoa fees for the 6 months lost plus take another 5,000 or so less because the market decreased in value.... again.

Here us out banks: take the money and RRRRUUUUUNNNNNNNNNNNNNNNN! We're doing you a favor, and want to see it work.

SHORT SALE CLOSINGS DONE WITHIN 45 DAYS AND SELLING BANK REMODELED HOMES

Kristina Rosen-Hester (TNT Realty & Associates) — Fri, 24 Oct 2008 19:58:51 -0700

TNT REALTY & ASSOCIATES IS CLOSING SHORT SALES UNDER 60 DAYS! We've sold 6787 33rd sT in Palm City 325,000, Jaslo in PSL for 240,000, 40 Sedona 140,000 and 42 Sedona 138,000 to mention a few of the short sales TnT Realty has closed. Pine Tree Waterfront in Palm City sold at 585,000. It's knowledge that makes these short sales successful. Their contacts with the banks help to seal the deal.

Loan Modification and Short Sales

Kristina Rosen-Hester (TNT Realty & Associates) — Sun, 12 Oct 2008 23:04:06 -0700

Whether we bought our homes within the last few years or not, we have seen the prices fall below what we are paying on our mortgages and that's not good. Many homes have gone into foreclosure because of job losses, some the owners just give up on,

Homeowners may want to stay in their homes, but we are noticing they don't want to pay the high mortgage from 2 years ago. Especially if they are renting their property out to tenants and the income is only 1300/mo. but the mortgage is 1800-2000/mo.

There are solutions and the one thing my husband and i always tell everyone is : There are choices to each situation. The worst thing we've noticed is people feel trapped like they cannot do anything about losign their home. They can short sale, do a loan modification, or restructure of the mortgage,or lastly deed in lieu ( credit is affected with this) to avoid foreclosure and with the help of a Realtor who knows how to negotiate. Anthony Hester has a working relationship with many of the banks on these issues and he puts his law background to use.

If you have clients that you need assistance with in Martin or St. Lucie County...

Kristina Rosen-Hester (TNT Realty & Associates) — Sat, 01 Sep 2007 17:12:55 -0700

Please feel free to contact us to assist your clients in sales, rentals or listings. We look forward to hearing from you who have clients down south in Lauderdale or Miami or north of Ft. Pierce. We are happy to send you a referral on each transaction. 2br 2 ba 1 car garage rentals in Jensen Beach & Stuart for $950-1000.00 In Stuart it includes WATER & CABLE. 3br/2ba/1 car gar 1000.00 including water & cable and 3br 2.5 ba 1 car gar. townhome for 1100-1200/mo incl water & cable. I have waterfront rentals in Palm City for 1200/mo. & 1500/mo. I have several waterfront properties in Palm City for 400,000, 600,000 range, & 800,000 range (short sale). Contact me for your client's needs. Kristina