From the mailbag:  Having a blog gives me lots of chances to get great questions from readers. One such reader recently emailed me about short sales.  Here’s how my answers went:

1.) Could you give me a short lesson on “short sales”?  Are they fairly standard, or many variations?

Each deal is different, depending on seller, mortgage company, property, etc.

2.) If a mortgage is leveraged on a house or piece of property, and the owner sells “short” is the owner liable/responsible for the deficiency?

Yes. Short sales are when the seller is still the person (not the bank), but they are selling it for less than they owe to the bank. Usually, depending on the amount, the bank goes after the deficiency, either in form of a new personal note, or a suit, or a lien on other assets, whatever.  Sometimes the bank forgives a portion of the mortgage debt.

3.) Does the mortgage holder have to approve the sale?

Yes, or they will not release the mortgage lien on the property. If they didn’t, the buyer would be buying a property in Montgomery with a mortgage (that is higher than the property value) already on it. You do NOT want to buy a property unless all liens are released or at least disclosed.  The buyer’s lawyer / closing attorney should discover and disclose all of this.

4.) How is it different from just walking away from a mortgage and allowing foreclosure?

A short sale is usually attempted before foreclosure. I say “usually.”

Each one of these is very different. In general, the bigger the bank that is owed, the harder it is to pull off the short sale. Like I had a buyer that put in an offer on a short sale on a waterfront home on Lake Martin. After about 75 days, the bank finally responded – NO. No counter offer, no nothing. 75 days (of the bulk of the summer) – wasted. On the other hand, a small local bank is able to pull off short sales and foreclosures rather effectively because there are real people making decisions quickly instead of talking (when you can get them on the phone) to a person in a cubicle in California.

Recently I read a great article in USA today, saying only 23% of short sales go through.  From my experience, I would say that it a pretty accurate number, if you include all offers made to all short sellers (like above).

5.) Are Montgomery short sales usually good deals?

Maybe.  Just because it’s a short sale or foreclosure does not necessarily guarantee that it is a good deal. You still have to go through the same thought process to make sure the value is there as a buyer.

6. What takes so long?  Why do some banks “drag their feet” so much with a short sale?

From talking with my friends in the real estate industry, this is a nationwide thing, not a Montgomery thing.  The short sales process is slow.  In fact, a Realtor I know in Tampa complimented me for getting it done under 120 days.

Again, the large banks are the ones that usually take a while to process a short sale.  In that particular case, it went like this:  on Day 1 the seller sends (fax only) the signed contract to the bank.  It takes 10 or so days for the bank to “process” the receipt.  Then they assign it to a representative.  Then the representative takes 14 days or so to contact you after that.  So really it was day 24 until the seller could talk to a person that told him “OK we’ve received your fax.”  Then he might ask for additional forms, say, another tax return from the seller, or some other such paperwork, that the seller might have even received.

Once the seller faxes those in, you guessed it, it takes about 5 days for the rep to confirm receipt.  Then he might ask for the contract again.  But – we’ve already sent that – right?  Well, I need the XYZ form…  These types of conversations go on and on for 3 or 4 weeks.  Then the rep (if you’re lucky) will call the listing agent to talk it over. Then maybe the bank will make some sort of counter offer or even accept the contract as is.  But any decision, any correspondence takes 3 or 4 days to send in, receive, and confirm receipt. It can be maddening, especially to the buyer.

Therefore my big advice to Montgomery short sale buyers is: Patience is part of the price you pay.

Again, I stress, this pain involved is usually directly related to the size of the bank. Emphasis on usually.

Own in Montgomery, and considering a short sale?

Please contact me at the number or email at the top of this page.  I would be glad to walk you through what will likely happen, and help you consider your options.

Hey you – reader – have any questions about Montgomery real estate?

Please let me know – I love to write blog posts on readers’ specific questions.  If you have one, chances are many people are thinking the same thing.  Help us all out, and ask away, either by commenting below or dropping me a line.  Thanks!

Just a quick reminder:

If you’re considering a Montgomery Public School magnet program for your child next year (2010-2011 academic year), get your applications in by January 29, 2010.

Need an application?  click here

Want to know more about magnet schools in Montgomery?  click here

Have any words of wisdom for families applying for a magnet program?  Leave your thoughts in the “comments” box below. We’d love to have your feedback.

Tucked beside the large Wylnakes neighborhood in East Montgomery, AL is a little enclave called Wyndridge. It is a Lowder development, but does not feel like a contrived neighborhood.  While there is a mixture of large, medium, and smaller lots/homes, there are also custom homes, trees, and a feeling that Wyndridge has developed over time, rather than over night.

I took the pictures above on a quick drive-through yesterday afternoon to give you a feel for the homes in the neighborhood. The homes in Wyndridge are on the pricier end of East Montgomery real estate.  Today (January 19, 2010) there are 14 homes listed for sale in Wyndridge ranging from $299,900 (2148 sq. ft.) to $689,900 (4885 sq. ft.). Neighborhood amenities include tennis courts, ponds and sidewalks, and landscaped common areas.

Wyndridge is accessed off of Halcyon Boulevard, making it VERY close to the Shoppes at Eastchase, Peppertree shopping center, the Sturbridge neighborhood and I-85.

Something unique to Wyndridge is the live children’s nativity during the Christmas holidays.  Children from the neighborhood take part in recreating the nativity scene, and are joined by live animals brought in for the occasion.

To see any of the homes for sale in Wyndridge, or any homes in the Montgomery area MLS, give us a call.  We’d love to help you with your house hunt!

StoneyBrooke Plantation is a planned community in East Montgomery, AL.  I recently visited a friend’s home in StoneyBrooke and realized I hadn’t blogged it yet.  So here we go . . .

It’s a Lowder Development (think Deer Creek and Woodland Creek neighborhoods on Vaughn Road), so if it seems very familiar, you’re right. It’s most unique feature is its proximity to I-85 – just off the I-85/Mitylene exit.   On the google map below, StoneyBrooke is red marker “A” (Deer Creek is “B” and Woodland Creek is “H”).

There is a large common area with a pond and picnic pavilion, plus a large playground.  The neighborhood is divided into pods according to lot size (50′, 60′, and 70′ lots), and has sidewalks and landscaped “greenscapes” throughout.  There is no pool or neighborhood clubhouse.

StoneyBrooke has existing homes for sale plus lots for building new homes.  As of today (Jan. 7, 2010) asking prices for the 6 homes available on the Montgomery Area MLS range from $192,000 (1655 sq. ft.) – $269,900 (2,433 sq. ft.).

If you like new construction and a walkable neighborhood with amenities,  plus you want to be super-close to I-85, StoneyBrooke might be a good fit.  Give us a call – we can help buyers with any listing in the Montgomery Area MLS (and it costs buyers nothing more to have a Realtor working for them).

Sturbridge, a popular neighborhood in east Montgomery, has two big ponds at its Vaughn Road entrance.  I was shocked to see that one of them is nearly completely frozen over in about half inch thick ice.

Buyers relocating from up north might say, “what’s the big deal?” But let me tell you, for central Alabama, a frozen pond is a rare occurrence.  This recent cold snap is breaking records.

I was running errands with my kids yesterday in the Vaughn Road area and was surprised to see some bigger kids playing at the edge of the pond.  They were breaking off big hunks of ice and throwing them back on the iced surface.  We paused to take some pictures and the below video.  For Alabamians, this is surreal.

Hey readers – does anyone else have some good cold weather photos and videos, in Sturbridge or the rest of Montgomery? Leave a comment or reply below and let the rest of us see!

The dirt was moving in Cawfield this morning.  Yep – tractors were out pushing the red soil around in this east Montgomery neighborhood right off of Pike Road.

Today (January 7, 2010) the Montgomery Area MLS shows there are 25 lots for sale in Cawfield for $59,900. There is currently one house built in the subdivision.  According to the MLS, all lots are at least 85′ wide and there is a 2000 sqaure foot minimum for new homes. Cawfield is zoned for Halcyon Elementary, Georgia Washington Jr. High, and Jeff Davis High School

Cawfield is next to the Lochshire neighborhood on the portion of Pike Road  between Vaughn Road and Hwy 80.  It’s also close to Bridle Brook, Woodland Creek, and Merry Station, and right across Pike Road from Grace Episcopal Church.  It’s about a 5 minute drive to the Shoppes at East Chase, the Chantilly Wal-Mart, Home Depot, and I-85.

The subdivision was sold to a new developer in September 2009.  It should be noted that lots in Cawfield have a Montgomery street address and claim City of Montgomery sewer service on the MLS.  In this section of East Montgomery, neighborhoods/lots can be zoned for the City of Montgomery, Montgomery County, or the Town of Pike Road. It’s kind of a patchwork, so if you have a preference, be sure to ask when looking for real estate in this area.

If you’re interested in building a new home in Cawfield, we’re not the listing agent, but we can help buyers with any property in the Montgomery area.  Give us a call and let us help you make an informed real estate decision.

One of the benefits of Pike Road living is its rural landscape.  Sure there are neighborhoods and the local CVS, but there are also fields and ponds, woods and creeks.

A future network of nature trails will showcase that beauty and connect the communities of Pike Road.  These trails will accommodate “walkers, joggers and bicyclists as well as horseback riders” (Town of Pike Road website). The Pike Road community encompasses a LOT of land, and the trail will be a way to begin to connect these areas.

A $700,000 grant has been approved to begin the project, and Pike Road has purchased property for the trail head and trail end. It’s an Alabama Department of Transportation grant program, and will take some time to complete.

According to the Town of Pike Road website, the first 14.7 miles of the trail will run from Highway 231 to Flowers Road. I don’t have specifics, but according to my google map, this is the general area below (Hwy 231 runs up the middle of the map, with Flowers Road at the red marker):

I can’t run all 14.7 miles at once (yet!), but since East Montgomery isn’t known for its mountainous terrain, at least I stand a chance with the first 5.  We’ll update you when the trail is ready for action.

To read more about the Town of Pike Road, see their official website, and see more posts from the Pike Road section of our blog.