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Absolutely! Most of the great family fortunes in our country have been created through real estate ownership and investments in real properties. People just like you are attracted to the opportunities presented by dealing with foreclosures because frequently they can buy the properties at prices substantially below market value. Buying properties at discount prices is the surest and quickest way to make money in real estate. Individuals who are looking for a home can get a significant amount of equity up front with foreclosures. Of course, there are no guarantees with any investment, but all across the country, people earn almost immediate income by “flipping” foreclosure properties for big profits. And many landlords are able to buy and rent foreclosures, producing positive cash flow and long term wealth accumulation.

Overview

In California, the primary method of deed of trust foreclosure is non-judicial. However, if a deed of trust does not contain the power of sale language or a standard mortgage is used, the lender may seek judicial foreclosure.

There is a rather lengthy notice and cure period between the time a property owner receives a notice of default until the property is sold at a public foreclosure auction sale - usually about four (4) months or more. Accordingly, don’t wait until the property becomes Real Estate Owned (REO) after the auction because the property will cost more than it would in preforeclosure.

A deficiency judgment is only available to a lender in judicial foreclosure. Therefore, a deficiency judgment may not be obtained when a property in foreclosure is sold through a non-judicial public foreclosure auction sale or if the foreclosure relates to a purchase money mortgage.

Please always remember one important item: It is absolutely critical that you learn as much as you can about the foreclosure laws that govern the state in which the property is located. There are many nuances and complicated steps that you must understand before making a bid at a public foreclosure auction sale.

Case in point, several states - including California - allow a homeowner/borrower to reclaim his or her property through right of redemption . And, overlooking a detail like this could cause a major problem. That’s the reason most prospective home buyers in the foreclosure industry prefer to purchase a property during the preforeclosure period.

PREFORECLOSURE

As is often the case, the best time to purchase property in California is during the preforeclosure period. Most properties are bought during this time.

If you wait until the public foreclosure auction sale - or afterwards - the competition may be stronger and the prices will be higher to cover the lender’s legal costs.

Basic steps for you to consider during the preforeclosure purchase process:

Contact the Homeowner or Selling Representative

* If a real estate brokerage company has listed the property for sale, work with that agent directly unless you prefer a certain agent of your own. The listing agent should thoroughly understand the seller’s situation and may even discount the brokerage commission to assist with a quick sale if there is no cooperating broker with whom to split the fee.
* If there is no listing broker, ask the owner directly in a friendly way for an appointment to see the property and to discuss potentially buying it. Anyone undergoing financial difficulty may not be inclined to speak with you directly and we encourage you to make initial contact in a minimally invasive manner. You can do this several different ways such as by sending a card or letter, making a telephone call, or by a personal visit at a time when the owners are likely to be at home.

*Note: All commission fees are negotiable, but providing fair compensation is the best policy to preserve future business opportunities, based upon the effort and expertise the agent(s) has contributed to the success of the transaction.

Inspect the Property

* If the broker/homeowner is receptive, you should schedule a mutually convenient time to visit the property. Once there, carefully examine the entire property, and take pictures for your file - provided the homeowner doesn’t object. You should also prepare a checklist to take important notes throughout the tour.
* If you’ve found your ideal property, work with the broker/owner to schedule independent professional inspections. Even though the home may look like it’s in fine condition, hidden defects may lurk beneath the surface or between walls. From the electrician to the exterminator, these inspections are critical because they will ultimately save you money.

Make an Offer

* If the inspections go well, and you are satisfied with the information you have gathered, you can prepare to make an offer. To do this, you will need current standard contract of sale forms, which you can get from most real estate brokers and attorneys. You may also be able to download and print state promulgated forms if they are available on the Web site of the real estate regulatory commission in the state in which the property is located. When preparing contracts it is always advisable to have an attorney represent you.
* It’s important to clearly explain the terms of your offer to the homeowner and/or the real estate agent. If you are unable to do this in person, write a cover letter that briefly explains to the homeowner the most important points of your offer, especially why it is in his or her best interest to accept it.
* Early in preforeclosure, when the homeowner may feel there is time to market the house for sale, your offer may be ideal because you have the financing already arranged. Or, because you are not making an offer contingent upon further inspections and repairs. If the preforeclosure time is running out and loss of the property through foreclosure is imminent, the biggest advantage is that you can close quickly and - to some extent - preserve the owner’s credit rating.

FORECLOSURE

Many California properties are bought at public foreclosure auction sales, but the competition may be strong and the prices are higher than during preforeclosure to cover the lender’s legal costs. At this point, it is unlikely that the homeowner will be able to avoid foreclosure. Therefore, the property will be auctioned to the highest bidder, including the lender.

By law,foreclosure auction sale must be announced publicly and held at the date, time and place required by state statutes. To find these sales, read newspaper notices prior to the auction date, look for public notice posted - when required - on the property, or search other public places in the county where the real estate is located.

Basic steps for you to consider when purchasing a property at a public foreclosure auction sale:

Contact the Lender’s Representative

* Contact the trustee,lender’s attorney,public trustee, or sheriff and ask what is required to purchase the property at the auction. Traditionally, an earnest money deposit amount in the form of a cashier’s check or money order is acceptable.
* Ask for a copy of the purchase agreement, or contract of sale document, that you will need to complete if you are the winning bidder. Have your attorney review it carefully and negotiate any changes in advance, if necessary. Be aware that the seller, as represented by an attorney,trustee or other official, may not be open to making many substantive changes - if any at all.
* Make arrangements to view and inspect the property if it is vacant. Even if it is still occupied, the attorney,trustee, or the realtor if it has been listed for sale, may be able to gain access for you. Realize that the owners may not be very cooperative.

Inspect the Property

* Once there, carefully examine the entire property, and take pictures for your file - provided the homeowner doesn’t object. You should also prepare a checklist to take notes throughout the tour.
* If you’ve found your ideal property, work with the broker/owner to schedule independent professional inspections. Even though the home may look like it’s in fine condition, hidden defects may lurk beneath the surface or between walls. From the electrician to the exterminator, these inspections are critical because they will ultimately save you money.

Always remember, you are buying the property strictly “as is” at an auction sale!

Bid on the Property at the Auction

* On the day of the public foreclosure auction sale, meet the lender’s representative at the courthouse and show him or her the earnest money deposit and an acceptable form of identification.
* Have your top bid worked out in your mind in advance. When bidding starts, be aware of your competition and increase your bid to exceed theirs by the increment set in advance (usually $100 to $1,000, depending on the value of the property).
* When you have won the bid, complete the transaction per the direction of the lender’s representative by signing the purchase agreement and submitting the deposit.

At this point, your earnest money deposit is non-refundable.
* Be prepared to close within the required time period, which is usually only 30 days.

Everything I’ve been reading is very suggestive of another big drop coming soon to the financial markets. It all started when Shanghai Index drop ~10% in one day and caused a skid on the stock markets around the world. Nearly 2 months later, they have recovered and hit record highs.

However, the story doesn’t end there. Shanghai is keenly interested in the sub prime mortgage market in the United States. Any signs that defaults and foreclosures will lead into a recession will cause a ripple effect throughout the world.

The state of the sub-prime market is pretty negative at the moment. It may be just gaining steam and can get a whole lot worse.

I would suggest watching the market carefully and determining the impact on your local economy. It’s obvious the real estate market is feeling the pain, but when it causes sales to slump in consumer goods watch out. Home Depot and Lowes have been feeling the pinch.

Recommendation: take some short positions and hedge your bets.

Capital Investment in Infrastructure is an interesting component affecting Real Estate investment. It can be one of the most positive influencing factors in property appreciation. Hence, it can never be taken for granted. Frequently, an investor will discover during the examination period of a poential investment that infrastructure improvements are planned. These improvements may be water and sewer expansion adjacent the property or new road to be constructed. In many of these instances, and without a great deal of consideration, the investor aquires as much of the surrounding property without regard to the timing of the purchase.

It is this investment timing that I am most interested in here today. To help determine the best timing of an investment I find it helpful to differentiate the type of infrastructure change. First, separate the target properties into Direct and Indirect Impact Investments. A direct impact investment is one that is immediately impacted by the announcement of an infrastructure project. An Indirect Impact Investment is one that is not immediately affected by the announcement or the early stages of the infrastructure but its value will be significantly improved by the completion of the project.

Lets compare two properties located outside Raleigh, NC, home of North Carolinas Research Triangle Park. The first property is a direct impact property located contiguous Interstate 85. The second property is approximately one-half mile away from the first and has frontage on a secondary road leading to the Interstate 85 intersection.

This area is considered a bedroom community for the greater Raleigh area and is in itself growing at a rate faster than Raleigh and Durham. The I-85 corridor had been developing well prior to the announcement by the North Carolina DOT regarding the re-construction of the highway from Raleigh north to the Virginia State Line, (40 miles of construction). This project would eventually take eight years, cause major delays, re-route traffic and have a major impact on the economy and expansion of the entire corridor.

The first response of most investors was to move out of the area and invest in other locations. However, for those who analyzed the potential and adjusted the price, timing and selection of properties in this area turned out to be a very profitable investment. Let me explain.

Direct Impact Sample Analysis

The first property is contiguous to I-85, was in a very active market and priced at about $100,000 per acre prior to the highway re-construction announcement. The value of the property was tied directly to the commerce generated by its access to I-85. The property value was evaluated as a Direct Impact Investment over the 8 year life of the infrastructure project determined by the duration from the project announcement until its completion.

Upon announcement of the project the value of the property dropped from $100,000 per acre to about $70,000 per acre and remained at that level for the first three years of the investment.. In the fourth year of the project life the property began to gain in value at about the same rate as other properties not aligned with the highway, still there was no positive influence caused by the highway project. The primary growth in value came toward the end of the highway project, eighteen to twenty-four months from its completion.

Indirect Impact Sample Analysis

The second property is well off Interstate 85 and has virtually no value associated with the interstate related commerce. When the project was first announced, its value was $12,000 per acre. This value continued to grow at approximately the same rate as the value other properties where the value was driven by non-interstate related factors. However, during the last two years of the highway project the property value grew substantially. The rapid escalation in value was attributed to the highways increased commerce generating capability. The transition from no impact to high impact was the much increased commerce generating capacity of the enhanced infrastructure improvement combined with the overall maturing of the area.

It is key to notice that the quality of the investment is higher for the land investor if the investment is made in the Indirect Impact Parcel and the timing of the investment can make a massive difference in the rate of return. In comparing indirect impact to direct impact properties, the compounded rate of value growth with respect to the year invested through to the end of the project showed substantially higher returns for the indirect impact property.

Perhaps the most intriguing aspect of these results is that for the indirect impact property, years four and five were outstanding; however, yer six fell to the lowest level of the project life. This is primarily due to finite limits of Interstate 85 to continue to drive value. Most of the growth in value was related to the investment in the highway capital improvement. The investment in Interstate 85 over the long haul created a gain in revenue generating capability which forced the property value upward. It is to be noted that growth in the interstate traffic after the completion of the project is slow and its ability to create additional value would accordingly be slow.

These properties will not see really strong growth until a commerce center is established at this intersection. With capital investment in a commerce center there will be value growth similar to the growth we saw with the highway, but it will occur in a shorter cycle time. I would therefore argue that the risk component would be higher and the timing would be more crucial.

Summary

In summary, for an investor to successfully select a high yielding land investment with changing infrastructure certain conditions are in play:

1. The target property must not be directly impacted by the announcement of the change in a negative way.

2. The investment property will increase in value at the local, not project, driven rate in the early years of the project.

3. There must be more than twenty-four months remaining life in the project.

4. The Indirect Impact Investment will yield higher creating less risk for the life of the project.

5. Timing is of utmost importance for the investment.

6. Direct Impact Investments offer both a higher risk and a lower yield during the project life.

We have been able to employ this thinking over the last five years and have found that the concept applies to any long term capital project.

When a modern new skyscraper goes up in Taiwan, the owners always hire a feng-shui geomancer or xiansheng to create the best position for the main entrance. Over the years, several major new buildings in downtown Taipei have remained unoccupied and their owners have gone broke because they failed to follow the dictates of Chinese geomancy during construction.

Geomancy (feng-shui) is the branch of classical cosmology, which gives a blue print for us to build our homes in splendid harmony with the elements of our natural environment. The Chinese exponents of Feng-Shui believe that where you live and how you allocate and arrange the elements of your home or workplace can significantly affect the harmony of your health, wealth, and happiness.

If you acknowledge and understand the all-pervasive life energy (Chi), you can affect the whole tenor of your well-being. Simple things like placing your furniture the wrong way, using wrong colours, and elemental conflicts (i.e. having the water ‘refrigerator’ next to the fire ’stove’, can create factors that impact negatively on your life.

The xiansheng considers four factors: the Chi or “breath of life” potential of the neighborhood; the site orientation or the importance of the direction in which the building faces; the five elements — fire, water, wood, metal, earth — and their mutual influence upon a location; the power of water and its significance in relation to the property.

While feng-shui is thousands of years old and has seemingly strange rules, it contains much common sense useful to understand by anyone. For example, Feng-Shui proposes that the best site for a home that will take advantage of the vital Chi is for that home to be on a south-facing slope - preferably between two hills of unequal size (the Azure Dragon and the White Tiger). Ideally, a river will be running along one side of the structure. The river should then turn in front of the building and then disappear.

Looked at another way, such a home on the south slope gets the maximum hours of sunlight, is shielded from the chilly, health-sapping north wind and has a good supply of water for drinking and cleaning. By then conveniently disappearing under the ground and gravel, the river carries away effluents and other “dirty” water.

So, just plain old common sense. Any BC builder will find it extremely useful - even necessary - to understand these concepts.

Some of the basic concepts as they relate to real estate are:

1. Avoid having a straight road leading directly to the home, with people coming and going it will dissipate the good influences.
2. Avoid building at the junction of a T-street or at the end of a cul-de-sac because these locations are on the receiving end of the straight-flowing Sha. A dead-end street traps the bad Sha.
3. The front entrance should not face the upstairs stairway.
4. The front door should not have a view of the back door. The through hallway is a no-no.
5. Heavy beams in the recreational room are a burden and interfere with Chi.
6. To have the right side low and the left side high are both unlucky. The hills to the left should be higher than those to the right.
7. Houses or buildings on triangular plots of land are ill-omened as the strange shape attracts Sha.
8. Water is very important and its positioning is vital to improving Chi and confounding Sha.

Fortunately (You knew it!) there are ways to rectify defects even if the defect is in the terrain. For example:

If the left is too low, plant trees to raise the height. If your neighbor builds a house higher than yours, add to the height of yours so your view of the stars in not obstructed. (Of course, you may have a problem with City Hall). If the plot is triangular, placing the door on the side of the triangle rather than on the point will counter the ill-omen. In properties which back onto a river or if the ground slopes upward from the front of a building, the entrance must be at the rear of allow Chi to gain entrance.

The Chinese also believe that a house with a front slightly lower than the back is useful in dispersing the influence of Sha. A pool of water (fishpond) is especially useful to conserve Chi. However, a large tree immediately opposite the front door is ill-omened as it d Sharp angles can be especially unlucky on an office or commercial building as these angles and straight edges drive off money, whereas curves attract money. Then again, the flat edges of buildings, which lead toward the front of your property, are fine conductors of Chi. But then again, if there is a road in front of the place, which turns at a sharp angle, this can bring about the same unhappy effect as a “secret arrow”. To counter this, a driveway leading up to a front door should always approach in a gentle sweep to help the entrance of wealth.

Superstition? It really doesn’t matter. What does matter is that if you are a builder it behooves you to know Feng-Shui as it relates to building. Whether you believe in it or not, feng-shui is seen by millions as an ancient science full of philosophy and practical wisdom.

If you drive through a predominantly Asian neighborhood and you find an empty lot in an otherwise fully developed cul-de-sac, you now know why. Bad fortune comes along the street and hits the last house in the cul-de-sac. Who would want to live there?

If you want to buy a new home in place that is bustling, growing, and interesting, but a little off of the map too, then try Austin, Texas. Austin Texas homes are being built fast and. although the area is growing without a doubt; it is still early enough to get a good deal on a house.

Austin Texas homes are much cheaper, but still built to last, than houses in many other big cities because the heat and the dryness of the area, as well as the fact that it is in Texas, scare most people away.

You should not be scared away by any of these conditions. Go out and look at the new homes in Austin Texas; you’ll be surprised with weather and home quality. Although there is many things wrong Texas, Austin is very different from most of the rest of the state. In the first place, Austin Texas homes are often newly built, and benefit from superior water and city services, so even though it is dry around you, there is no worry about droughts.

The hot weather is another thing. Austin Texas homes are cooled by air conditioning, but when you are out of the house, you will just have to deal with the heat, and that is all that there is to it. But do not be scared away by the Texans at least.

If you are buying a home in Austin Texas, you are likely to be living next to some of the most interesting and progressive neighbors anywhere. This is because Austin is such a Mecca of culture and art. There is a great music scene, a pretty left wing political scene, and arts and literature are also not far behind.

Austin Texas homes are not located next to rednecks in El Paso, but in an area with an artistic community to rival New York City. The east coast snobs might scoff, but I say let them, they’ll lose out. Unlike Manhattan, Austin is still growing that no one but the very rich can flourish.

Austin Texas homes are within the reach of most middle or working class families, so it really does make a lot of sense for you to move there. The amount of home you can buy can not be bought else where for the same price. No matter what your economic background is, you really should think about owning a home in Austin, where you will benefit from one of the liveliest communities in America. After all, all of the cooler and less desolate places have already been settled, so where else do you think that you are going to go, anyway?

You could move to the southwest, New Mexico. New Mexico is primarily a large rural state that has much to offer in the way of real estate, year round outdoor activities, and cultural events and celebrations. Prices of New Mexico homes vary throughout the state and greatly depend on geographical location. Santa Fe is the capitol of New Mexico, which is located in the north central part of the state. Los Alamos, home of the Los Alamos National Laboratory, is just thirty minutes west of Santa Fe, and just forty-five minutes southwest on I-25 is Albuquerque, the largest city in the state.

Historic Route 66 passes directly through Albuquerque complete with nostalgic cafes and businesses along the way. Further south is Truth of Consequences, then Las Cruces, the second largest city in the state, where I-25 ends and I-10 begins, taking motorists forty-five miles south to El Paso, Texas, and the Mexico border? To the east is the infamous alien town of Roswell, and to the west is Silver City nestled in the Gila Mountains.

So you decide where you want to investigate buying a new home in Texas or New Mexico.

By: James Allen

If you’re investing in properties, then investing in some good real estate software may save you time and headaches. This type of software can make your complicated calculations for you, and help you plan your real estate investments.

Different real estate software has different features, and what kind of software is right for you depends on what kind of home or land investment you’re getting into. There are different programs for personal properties, income generating rental investments, or vacation homes.

The most basic feature most real estate software has allows you to input your expenses and investment data, and it will automatically give you a monthly payment. You can adjust the parameters to your individual finances, and the software will do all the calculating work for you.

Keeping track of expenses on all your rental properties can be a serious pain, so some software programs use spreadsheets that help you keep your finances organized. You can keep track of expenses such as utilities, so you can keep track of all your accounting. Especially if you have many rental properties that you have to manage and keep track of, a good software program can help you do it.

Some programs have features where you can put in the market rate and all your expenses, then the program will tell you how much you should charge for rent. You can adjust variables and it will automatically adjust the outcome. You can then use this as a guideline when deciding how much rent to charge tenants.

If you are buying a rental property for yourself and plan to turn it around sometime in the future, there are programs that can help. For example, some software programs allow you to do backwards calculations. This means that you can tell it what kind of return you would like to get on a particular investment, and it will tell you how much you should be paying initially. You can also plug in different factors, and it will take this into account as well.

Then, there’s our old friend - taxes! Once you start investing in real estate, you’ll see how complicated this can get. There are now software programs available where you can enter in all the information and it will calculate your taxes over a set period of time. This can help you with your long-term financial planning, and get rid of any surprises you might encounter along the way.

One great feature some software has is the ability to calculate hypothetical scenarios. We all know that property values can fluctuate. Some software allows you to experiment with different situations. You enter a “what if” situation and the software tells you how it will effect your investment. This can help you keep on top of changes in the market or the area where you own properties.

The best software programs have features where you can input different numbers and see what comes out. A mortgage calculator is a good feature to have; there are a variety of factors you can punch in, and it will tell you how much you can expect in the future.

At their simplest, real estate investment programs can help you keep track of your finances in an easy-to-use spreadsheet format. But, if you want special features, you can find just the right program for your specific needs.

By: Adam J. Heist

Not everyone is upset that home sales are dropping sharply in some markets. Sellers, realtors, and mortgage lenders are, but buyers certainly are not part of that group. Years of overheated housing markets have taken their toll as home prices have surged, locking thousands of buyers out of the market. If you are looking to purchase your first home, then a slow moving market can work to your advantage if you follow the tips outlined below.

Know Your Market: Now is not the time to rush in and buy a home. In years past, many buyers did just that and bidding wars broke out that pushed home prices up by the tens of thousands of dollars. Sellers won and buyers were saddled with more debt that they needed. Relax: with less people in the market to buy, you can sit back and truly explore the housing market to find a home at a price you can afford.

Get Approved: Do not rely on a prequalification from a realtor when searching for your home. A realtor prequalification do absolutely nothing. Instead, search for the best mortgage financing deal available and secure your financing at a competitive rate. Lock that rate in for 90 days and then go shopping for a home. Oh, take that approval letter with you when you shop and you’ll have plenty of leverage with the buyers.

Negotiate: The longer a home is on the market, the more likely an owner who must sell will be in the bargaining mood. No, you may not be able to get them to whack the price of their home. However, you could have them throw in window treatments, a refrigerator, or some other important appliance you would have had to shop for once you moved in. If the local market has turned particularly sour, ask for the owner to pay your closing costs too.

Seller Financing: If you have difficulty obtaining a mortgage, consider asking the seller to hold the mortgage for you. If not receptive to this option, ask if they would consider allowing you to rent/lease for one year with an option to buy later on. Determine the selling price one year down the road and ask them to set aside some of the rent money for your down payment.

Yes, buyers are in the driver’s seat the first time in more than a decade in some markets. Place the game right and you could walk away with a deal that simply cannot be beat.

In real estate, a short sale is a sale that happens when the outstanding loan against a property is greater than the market value of the property itself.  A short sale represents a solution for a homeowner who cannot pay his mortgage and wants to walk away from the property without blemishing his credit and financial profile through a foreclosure or bankruptcy declaration.  Not all banks will consider the short sale, but many will. You will need a willing lender/bank and buyer to complete a short sale. Here is how you do it.

1. Value.  Confirm the value of the property by having a real estate agent perform a Comparative Market Analysis (CMA).
2. Costs associated with sale of property.  Figure out what you will spend on selling the property.  Total up advertising costs, any broker fees/commissions you may incur, as well as the closing costs for the deal.  Ask your mortgage broker about the fees associated with closing.  Be sure to include any legal fees in your calculations.
3. Total loan value.  Total up all loans against the property.
4. Do the math.  Subtract the total amount of money owed against the property from the expected earnings of the sale.  The number remaining represents the “short” of the short sale.  The lender will factor this number into consideration when deciding whether or not a short sale is appropriate.
5. Legal assistance.  You may want to consider hiring a lawyer or having a family friend who is in the legal profession assist you with the deal.  This article can give you a general idea about the short sale, but cannot substitute for legal advice.
6. Accountant. It is a good idea to get an accountant’s input on the short sale before you proceed.  There are tax implications in the short sale, just as in any real estate transaction.  You need to know exactly what you will owe before getting into a short sale scenario.
7. Find a buyer.  In order to do a short sale, you’ll need to come up with a buyer to pay off the amount of money your lender will accept.  The new buyer will not assume your mortgage, rather, the sale of the property will result in you paying off the mortgage directly and the buyer having his own new mortgage on the property.
8. Contact lenders.  It is now time to get a lender involved with the deal.  Indicate to him that you are interested in a short sale, and share the information on your specific property with him.  Depending on what percent of the estimated value you offer the bank, the lender may accept your deal or not.  It can be difficult to find a lender with the authority to accept a discounted amount for the loan payoff, so do not think the first broker you call will jump on the case.
9. Proving insolvency.  You must prove that you are incapable of paying off the entire mortgage and/or staying current with payments month to month.  The lender will perform another mortgage application process to discover if you are, in fact, incapable of the financial responsibility you agreed to when you got the original mortgage.  If the root of your financial woes occurred before you received your first mortgage, the lender may have a case against you for fraud—so beware. Also, know that lenders will almost never do short sales for properties with second mortgages since the lender in the second mortgage will not be happy about forfeiting his investment.
10. Sell the property.  Once your lender has okayed the deal, and you have a buyer, you are free to sell the property.  The lender will want to see a contract between the seller and the buyer indicating that the sales price is the exact amount of payment that the bank will be receiving from the seller.  The bank wants to be sure that you (the seller) are not pocketing extra money off the deal.
11. Benefits for the lender.  Lenders and banks routinely put properties into foreclosure in order to get their money back in a situation where the borrower defaults. A short sale may be an attractive alternative to the lender in some cases.  In a short sale, the lender does not have to deal with some of the unpleasantries of a foreclosure, including the eviction process, attorney’s fees, costs associated with the resale of the property, damage to the property, and all the delays that are likely to occur in the process.  Even though the bank is getting less money, they are getting it “now.”
12. Benefits for the buyer.  The buyer gets a property at a discount.
13. Benefits for the seller.  The benefit to the seller is that he walks away from the deal without having to declare bankruptcy or having to go into foreclosure.  His credit report will be unaffected by this deal as well.

The short sale deal can be a creative way to save your credit and avoid declaring bankruptcy.  Be sure you talk to a lawyer, a competent lender, as well as an accountant to verify the details of short selling with particular reference to your situation. Good luck.

Slowdown in residential building and home sales will be felt throughout the economy; weaker jobs and consumer spending expected.

An overview of what a housing slowdown can do to the economy. The money article also has links to 19 real estate markets:

In summary:
Dead Zone (overpriced by up to 67%): Boston, Las Vegas, Miami, Washington D.C. North Va, Phoenix, Sacramento, San Diego
Danger Zones (overpriced by up to 57%): Chicago, Los Angeles, New York, San Francisco/Oakland, Seattle
Safe Havens (fair values up to -15% undervalued): Cleveland, Columbus, Dallas, Houston, Kansas City, Omaha, Pittsburgh

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