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4 Ways to Make the Most of a Tampa Home in Pre-Foreclosure

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Though the sunshine in Tampa can be bright and beautiful, sometimes the dark clouds of foreclosure gather overhead. Those clouds could be because of the loss of a loved one, job layoffs, divorce, or medical bills.

Whatever the reason, if you need to sell a pre foreclosure house in Tampa, there are steps that you can take to make that process less daunting.

How to take action in pre-foreclosure

Sale on a house in Tampa man

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The worst thing that you can do when you’re approaching Tampa foreclosure is to put your head in the sand and ignore what’s happening. Making the most of your pre-foreclosure in Tampa starts with you taking decisive action to get back in control of the situation.

Here are four ways to make the most of your Tampa Bay home before it becomes one of the thousands of Tampa foreclosures that happen every year.

1 – Determine your Tampa Bay home’s value

Before you move forward, you need to find out where you’re starting from. Thanks to the internet, you’ve got instant access to what market value looks like for your house in Tampa Bay, FL.

Look for similar homes in your FL area with comparable features.

You won’t be able to get a firm idea of the value of your house without a home appraisal, but home appraisals can be pricey in Tampa Bay, and you might not have the money to spend on that. Look for information relating to other real estate in your area of FL and try to find out what each property listed sold for. This part is important – you need to know what the sale in Tampa, FL was for, not what an online platform like Zillow estimates your house to be worth.

This is really just a starting point for your property, but you have to start somewhere.

2 – Find out exactly how much you owe on your loan

Woman calculating mortgage balance on foreclosures in Tampa, FL

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Next, you need to determine exactly how much you owe on your mortgage. This will include not only the principal and interest, but also any late fees or other penalties that have been added to the property loan.

Knowing the estimated value of your home combined with the amount you owe on the loan is essential.

Look on the website for your lender, and you should be able to search for the exact amount. If you’re more comfortable calling your mortgage holder, you should be able to get a payoff amount on the property from the help desk.

Typically, a lender will charge you a late fee when the mortgage is ten days past due, though some Tampa, FL lenders don’t charge a fee until fifteen days.

3 – Talk to buyers and agents

House in Tampa, FL for short sale

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Your next step is to talk to potential buyers. Pre foreclosures and Tampa foreclosure listings are popular with investors because they know that homeowners like you are most interested in avoiding foreclosure evictions in Tampa, FL.

Understandably, homeowners in Tampa, FL who are nearing foreclosure are willing to sell their homes for below market value in order to prevent pre-foreclosures from turning into foreclosure listings. These homes are generally good deals for the new owner. Selling a home is an instant way to stop pre foreclosures and get the loan completely paid off.

Use the information you gathered about what you owe and what your home is worth to negotiate.

Whether you decide to use a real estate agent for your Tampa, FL property, or decide to go with a real estate investor, you want to make sure that you are getting the best deal for your property.

It’s a smart move to only work with a Tampa real estate agent who has done properties in pre-foreclosure in the past. The same goes for a real estate investor – make sure you find someone who has experience in pre-foreclosure properties.

4 – Stay in close contact with your lender

House with lots of square footage in Tampa

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Though it might be tempting to decline calls from your Tampa, FL mortgage holder, it’s a much better idea to take those calls.

Tell your bank about the plan that you have from the very beginning. If you keep an open line of communication with your lender, they’ll be more likely to work with you if it comes down to short sales.

No bank wants a property to become bank owned if they can avoid it. Foreclosure listings aren’t good for anyone. Don’t just talk to your bank, you can also have your real estate agent or the real estate investor you’re working with talk to the bank. All of this is helpful during pre foreclosure.

Other things to consider with Tampa pre foreclosures

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In your calculations, don’t forget the expenses that go into selling a house and moving.

In a traditional sale in Tampa, FL, you’ll have to pay for preparing the house for sale, including repairs, staging, pictures, etc. You’ll also want to calculate real estate commission, closing costs, and moving costs from the price that you get for your home.

You could end up with money in the bank

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Hopefully, you’ll be able to come out with money in the bank instead of your house becoming one of the thousands of Tampa foreclosure homes. It’s even possible that you’ll have some cash leftover from the sale proceeds if you play it smart enough.

If you can’t cover the costs that are associated with the sale of the house in Tampa, FL, then you might end up having to come out of pocket or negotiate through short sales. All that being said, home prices in Tampa, FL continue to increase, so odds are that you’ll be able to sell your home for a bit of profit before it becomes bank owned. It’s a powerful thing if you can walk away from the house with some cash left. There’s really no better way to make a Tampa Bay day sunny.

Don’t Get Burned: What to Know About North Carolina We Buy Houses Scams

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In every big city and every small town in North Carolina, you’ll see them – neon signs stapled to the sides of telephone poles with a phone number scrawled across the bottom and the slogan “We Buy Houses for Cash!” in bold lettering.

The question is whether these cash home buyers are really going to buy your house, or if the North Carolina offerings are scams. Could these quick sell offers be too good to be true?

Unfortunately, the answer isn’t straightforward.

We buy houses North Carolina scams are prevalent

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It’s important to be clear here – there are a lot of scammers out there in North Carolina.

When selling a North Carolina house, odds are you’ll get a lot of solicitations from potential buy houses companies interested in giving you a cash offer. Sometimes these are legitimate, and oftentimes they aren’t.

Part of the reason these scams are so widespread is that cash home buyers really do exist and they really do offer cash for a house fast. North Carolina companies generally target people who have distressed properties or who need to sell fast, and criminals see that vulnerability as an opening for them to get a quick, dishonest buck.

How to spot a buy houses scam

North Carolina house near Asheville in Buncombe County

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Avoiding a we buy houses North Carolina scam starts by knowing what to look out for. There are common, telltale signs that scammers use again and again.

What should you look out for? Here are some of the biggest red flags from someone who says they are a buy houses company in North Carolina.

  • They ask you to sign over the title of your home without a written contract.
  • They tell you not to talk to your lender about the deal.
  • They ask you to give them money upfront prior to closing.
  • They say that they “overpaid” and you need to send them a refund.
  • They offer you more than fair market value for your distressed property.

If any of these things come up from a buy houses company in North Carolina, you should promptly walk away from whoever you’re talking to.

Though you might think that there won’t be other opportunities for you to sell your house, it’s never worth the possibility of getting involved with fake real estate investors. You’ll lose more money by dealing with a buy houses scammer than you ever will be waiting for another potential buyer.

It’s worth noting here that cash buyers who’ll give you a no obligation offer are not rare in North Carolina. If you’ve come across a scammer, then you should look for other cash buyers to sell your house quickly.

Reporting fake real estate investors

North Carolina Home with a no obligation cash offer

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If you find that you have had a run-in with a cash homebuyer scam artist, it’s important that you take steps to report them to the authorities so that you can protect other homeowners from getting taken advantage of.

One place that you can report a scammer to is the Better Business Bureau. The unfortunate reality is that if they are a con artist, you’re unlikely to find any record of them with the BBB. The good news there is that you can vet potential buy houses for cash companies by looking them up through the BBB.

Where you really can make a difference if you think you’ve fun across a cash home buying scam in NC is to report the person you’re speaking with to the North Carolina Attorney General. It’s easy to contact the Office of Josh Stein, the NC Attorney General, through the official NC Department of Justice website.

You can also contact local law enforcement in the North Carolina county that you live in. This might be the sheriff’s office if you live outside the city limits, or it could also be the city police department if you live in a city like Raleigh, Charlotte, or Asheville.

Are cash buyers a ripoff?

Raleigh skyline in Wake County, NC

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Depending on the situation that you’re in as a homeowner, honest cash buyers can offer you a positive solution to sell your house fast.

What can feel like a scam, even with cash home buyers who are being honest, is that a “we buy houses” company might offer you a very low price. Keep in mind, there is no obligation to accept a cash offer, but even the offering can feel like a ripoff.

Talk over your options before committing to anyone. Be sure to calculate real estate agents’ fees and service fees before you make a commitment to selling your home to anyone. Creative real estate solutions like a cash offer might make the most financial sense for your home in Forsyth County, Wake County, or Johnston County, depending on what needs you have and whether you want to sell your house as-is.

Though you might not get as high a price for your home with a cash offer, repair costs and extra fees could eat so far into the profit from a fair market sale that you come out better with an instant cash offer.

Distressed property buyers

Oftentimes, buy houses North Carolina companies are focused on buying distressed property. Basically, they buy ugly houses and then either turn them over to another buyer or fix them up and sell them. Only occasionally is a cash buyer interested in buying a distressed property for themselves.

In order for these cash companies to stay profitable, they have to purchase houses for a low price. It doesn’t matter where the property address is in North Carolina, from Orange County to Durham County and beyond, they’re often willing to pay cash for the house so that they can fix it up and sell it.

Doing all the repairs requires a significant investment, which is why these companies can’t pay market value. They won’t make a profit if they do.

How do We Buy Houses companies turn around NC property so fast?

Aerial view of a house in North Carolina

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The simple speed of the sale with a cash offer from local investors can make it feel like a potential ripoff.

The average real estate process takes around three months in North Carolina. This is because the selling process involves determining the repair value through a home inspection, the market value through a home appraisal, and the mortgage value through a mortgage company.

A local investor who buys burdensome houses fast doesn’t have to participate in any of these things if they are coming to offer cash. In fact, the thing that slows down home sellers in Mecklenburg County and across NC the most is the need to deal with a mortgage company. Banks demand a lot of hoops that slow down the process, where an investment firm doesn’t have to do any of those things to complete a home sale.

Life changes often lead to alternative home selling

For many reasons, a homeowner in NC might not want to go through the traditional home sale process. You might need to sell your house in Guilford County quickly because of a divorce, the loss of a family member, a relocation, or a North Carolina hurricane.

These companies are another option for buyers who have properties so badly damaged they cannot be financed through conventional buyers.

How much do We Buy House Companies in North Carolina pay?

We buy houses companies and local real property investors generally offer less than the market value of a home. You may be able to find an approximate value for your home by viewing comparable listings for comparable houses that have been recently renovated and looking at the price they sold for before that renovation.

In North Carolina, the average listing price of a home is $359,500. If a We Buy Houses company believes you have value after making necessary repairs, $50,000 for example, they might offer you roughly $251,000. You can always negotiate with the potential buyer through the selling process.

Remember that what you get from a home investor first is always a no obligation offer. No one is going to force you to sell your house fast in North Carolina. You have the right to walk away from a deal if you don’t think that it’s fair, even if you’re trying to avoid realtor fees and sell your house as is.

Don’t agree to cash offers without some investigating

Close-up of a person realizing their NC Real Estate deal is a scam

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While there are many cash buyers out there in North Carolina who are above board and genuinely want to buy your house fast for cash, criminals are also right there in the mix, ready to take your money and be on their merry way.

To weed out the potential scam homebuyers in NC and find dependable homebuyers, there are some things that you can look out for.

  • High rating with the Better Business Bureau
  • Positive reviews online
  • Sizeable website with testimonials
  • Multiple methods of contact – phone, email, text, etc.
  • Verified proof of funds document with call to their bank

Making sure that you don’t get taken in by a scammer isn’t that difficult if you make sure that you follow up with outside research.

If you’re unsure about the process, you can always reach out to a real estate agent or a real estate attorney to make sure that the cash buyer company you’re working with is one of the good home buyers.

Other home buying scams to watch out for

Cash home buyer scams are the only thing that North Carolina home sellers should watch out for. Too often, people prey on homeowners who are in tough situations with a variety of real estate scams.

Here’s a list of real estate scams that have happened to North Carolina home sellers in the last two decades:

  • Escrow wire fraud
  • Predatory loan flipping
  • Fake foreclosure relief
  • Rent to own home sales

All of these scams are avoidable if you watch out for the signs of a scammer. The good news is that they’re easy to spot because the all get their scams from the same playbook.

When you go to investigate the home buyers, there will always be things that don’t add up. Though you might be eager to get out of your North Carolina house fast, you’ll only end up in more trouble if you ignore red flags.

If you’re ever in a place that you feel isn’t quite right, contact an NC credit counselor, a real estate attorney, a real estate agent, or real estate investors that you know to ask if the deal sounds good. It’s always a good idea to get another set of eyes on your potential deal before you get yourself into trouble.

The simple act of talking out the deal with someone you can trust will often weed out potential scams in NC and keep you from getting burned.

Why people work with cash home buyers

Trying to sell a house on the open market, with commission fees, taxes, repair costs, closing costs, and all of the other added money that comes in at closing can be intimidating and frustrating. Working with dependable homebuyers takes the stress out of those transactions because the home seller can just opt out of much of that hassle with the house.

For many homeowners in NC, getting fair market value comes second to getting out from under a burdensome house. Buy house companies in NC offer an opportunity to get the property address off of their hands and give the owner the freedom to do other things.

Sometimes, it’s not so much about getting a huge number for a home, but being smart by avoiding agent fees and costs associated with selling a property address in NC. A fair all cash offer can solve lots of problems, depending on your situation.

This need to get moving on a house fast is a big reason that people end up in real estate scam situations. When you have to get your house sold fast, you’re willing to entertain lots of things.

August 2022 Real Estate Market Update – Connect Homebuyers

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What is normal in the real estate market?

Everywhere in the news we’re seeing that things are “getting back to normal” across the country. Rental prices and home prices are at least slowing down in their meteoric rise, even if they haven’t totally evened out just yet. The pandemic seems to be winding down, or at the very least we have the tools to deal with it effectively enough that life can keep chugging away.

Normal is of course relative, and the normal that things are getting back to in the real estate market is not necessarily going to be the normal that existed prior to the pandemic. If anything, we’re going to shift to a “new normal” that will be similar to what we had before but not quite the same. There’s a potential new wave pandemic on the horizon with monkeypox and omicron, but neither of those is threatening another shutdown right now.

The past two and a half years have been undoubtedly life-changing for everyone. There’s an old curse that people sometimes say to those that they wish ill upon – may you live in interesting times. We have certainly lived in interesting times, and we continue to live in them. 

The catch is that all times are interesting. Anyone who is investing in real estate right now should be old enough to remember the real estate bubble bursting in 2008, causing the huge flood of the Great Recession. Those were interesting times to live in, and they were just fourteen years ago. Overnight, the real estate market that used to seem so stable and immovable suddenly evaporated. Who could have imagined home prices going down? 

We cannot know what’s coming in the fall for the real estate market, not for certain anyway. It will most certainly be interesting though, and at least more stable, even if it’s not normal.  

China’s Summer Real Estate Catastrophe

Huangpu Qu, Shanghai Shi, China housing crisis

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There’s a housing crisis running through China that is threatening to upend one of the world’s largest economies, and it looks like it’s just getting started. 

The major issue is with debt in China right now, thanks to developers who over-leveraged their ability to deliver on huge construction projects and are now falling further behind with finishing homes. Homebuyers across China are increasingly angry, and with good reason. 

What’s unique about the housing crisis in China is the way that homeowners have come together to address the massive issues they’re facing. Recently, a group of mortgage holders in China came together and have vowed to stop paying their mortgage loans if construction doesn’t resume on three hundred partially finished homes. Construction giant Evergrande is increasingly a lightning rod for the frustration, with its massive debt laid that has caused a number of construction halts and raised the ire of homebuyers. 

Much like the massive bailouts we saw in the United States back in 2008, the Chinese government is exploring whether they need to step in to save homeowners and builders alike. The current bailout proposal would provide almost $150 billion worth of funds for developers to finish construction on the homes that are in progress. Whether that would solve the root problem is a whole different story, but it would at least mollify angry homeowners.

The crux of the situation is that home buyers in China are saddled with paying construction companies on homes that they can’t live in. These mortgages tie up major parts of the disposable funds that middle class Chinese families have, preventing them from using that money for other housing. Where these families are working hard to build a better life for themselves, they are saddled with debt for homes they may never step foot in.

Not only is it a problem that homeowners might not see the homes they’ve paid for, but even if they were able to get into the homes, the property would likely be worth less than the mortgage they owe. Falling real estate values in China are pushing home values lower at an alarming rate. 

The problem isn’t just affecting the ability of individuals to buy homes, it’s also bleeding into the other parts of life in China. Individuals are changing their marriage plans, halting their development of new businesses, and putting off having children due to the lack of stability in the housing market. How far the problems go and how long they continue to push middle class families to change their lifestyle has everything to do with how long this crisis goes on.  

The pledges by collectives of homeowners to defy large corporations like Aoyuan and stop paying their mortgage payments could potentially destabilize the Chinese economy if conditions don’t change. The issue affects more than ninety cities across China, and the scope of the problem is massive. The societal impact of hundreds of thousands of buyers simply opting to stop paying mortgages on these unfinished homes is unknown as the situation is so unprecedented. 

Why Professional Cleaning is Essential for Home Sellers

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Moving into a new house can be incredibly stressful, especially when you’re trying to sell the home that you’re moving out of. Getting the home clean and ready not only for the new owner to move in, but more importantly for the sales process, can feel daunting. 

Hiring a cleaning company might feel like a waste of money because it’s the kind of thing you could do yourself in theory, but in reality there are lots of benefits to having a professional cleaner take care of this aspect of the home selling process. 

  • Buyers want a clean start

Home buyers want to come into a space that looks new, even if it’s not. Though you’ve lived in the home for a long time and might not notice the dust on the baseboards or the grime around the back of the toilets, a professional cleaning service will spot those things in a deep clean and create a fresh slate for the new buyer. They’ll detail your house in ways that you might not think necessary. These professionals understand the depth of cleaning that’s required for a buyer to see your home the way you want it to be seen.

  • Cleaning takes up valuable time

The biggest reason to hire a professional cleaning service when you’re selling a home is that cleaning a home takes a lot of time. Rather than eating up those hours scrubbing the floors or wiping off fan blades, let an expert take care of it. This extends to especially tough areas like kitchens and bathrooms, as well as to carpets. A professional cleaning service will be able to do the job faster and more thoroughly than you can. 

  • Return on investment

There are lots of costs associated with selling a home, and some of them have a better return on investment than others. Professional cleaning is one that will almost always give a positive return because it makes such an impact on potential buyers. A dirty house can indicate to buyers that there are other problems because the home has not been well maintained, leading them to offer lower bids and for you to get a lower return overall.

  • Professionals will do a better job

When someone is performing a job that they are experienced at, they learn to see things that others just can’t. A professional cleaning company will have the experience to see things in your home that you might not, like how much nicer the room looks when the light switches and doorknobs have been scrubbed. These minutiae make a big difference in the overall impression that buyer gets when they look at the home.

When you’re selling a home, whether it’s on your own through a FSBO listing, with a realtor in a traditional sale, or with a cash buyer. A professional cleaning crew will be able to look at your home with fresh eyes and see things that you can’t. Once they see those things, they can come in with professional grade tools and techniques to clean in the house faster and better than you have time or headspace to do. 

New Construction is Booming in Raleigh-Durham

North Carolina flag over a new construction home

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The Raleigh-Durham home sales market has been one of the top real estate markets in the country for decades thanks to a robust economy, relatively cheap home prices, and a high standard of living. RDU provides the amenities that many bigger cities offer, and the temperate climate offers a more relaxed and balanced pace of life compared to other metropolitan areas.

In a recent report from the Inspection Support Network, the Raleigh-Cary region was found to be among the top three metro areas for new home construction. RDU ranked behind Nashville, Tennessee and Austin, Texas. This is an important statistic because it means that, though home construction continues to be hampered by supply chain issues, this area is increasing its real estate inventory. 

The region measured by the report includes Franklin County, Johnston County, and Wake County. The study measured the 53 biggest metro statistical areas in the United States. Per the findings, for every one thousand existing homes in the RDU metropolitan statistical area, 39.5 new housing units were built in 2021. 

The total number of new home construction properties in the RDU area was 21,649 for the entire year, which is a substantial increase over the last year that data is available, 2019. In that year, there were just 13,320 new home projects approved. It’s notable that there is no data for 2020, as the pandemic derailed almost all new construction during that year. The increase is significant – 62.5%. The growth in RDU in new home construction approval is behind only the Philadelphia metro area. 

The takeaway from this report is that RDU is going to be a leader in metropolitan real estate markets in the next several years. As work has pivoted from in person to remote, there was some question about where things like new construction would fall and whether there would be some shift away from traditionally hot markets like RDU.

These new numbers show that new home construction is still centered in the same areas that it was before the pandemic, at least in the case of the Raleigh-Durham-Cary market. Without a significant move towards lesser growing areas, investors and homeowners can safely assume that RDU is going to remain in the highest echelon of home sales and construction across the United States. 

Wild Homes: Rounding Out in Sarasota

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Anyone interested in hanging a”round” for some fun? A recently listed property at 3201 Peachtree Street in Sarasota, FL has made a circuit around the internet recently not only for its incredible shape, but also for its throwback interior. 

Sitting on a half acre lot in the midst of a grove of trees, the house has been masterfully flipped from a run down oddity to a sparkling example of throwback styling. It’s an incredible home for anyone of any age. 

Image by David Bruce Kawchak

Built in the round, the home has a three bedroom, one bathroom layout that’s all packed into just under thirteen hundred square feet. Though it was modeled on the Hilton Leech Art Studio down the street in Sarasota, Florida, this is a private residence that would be suitable for a family. 

What makes this home so unique isn’t just the round design, it’s that it’s in almost pristine retro condition. The colors, finishes, and furnishings all offer a 1960’s vintage feel that is like walking back in time. 

Awash in blue, white, and brown tones, the home is a sanctuary from the hustle and bustle of the outside world. The soft curves of the walls contrast sharply with the bursts of light fixtures and the long lines of the furniture. 

Image by David Bruce Kawchak

Recently renovated, the interior footprint of the home was changed thanks to the removal of an interior wall to make a larger primary bedroom. In addition, the bathroom was updated to include mosaic tile and a luxury tub. Though the home is full of retro appliances, they’ve been restored with the recent update to provide the kind of convenience that we would expect in a home at this price point. 

In fact, a whole host of improvements went into the updates on this home. The addition of a new roof and new HVAC, as well as new Impact windows and wifi LED smart lighting throughout the home give the retro styling a modern backbone. Prior to the latest renovation, the home was in disrepair.

Originally listed at $899,000, 3201 Peachtree St. is a home that’s well worth the buzz. 

What the Huge Rise in Foreclosures Across the U.S. Means for the Housing Market

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Foreclosures are a part of the real estate economy, and there’s nothing fundamentally wrong with that. The way that the U.S. market is structured, there will always be a percentage of homes that revert back to the lender when the homeowner can’t pay back the loan. 

The question isn’t whether there are foreclosures – it’s how many foreclosures there are. In the last six months, there’s been a dramatic increase in the number of foreclosed homes in America. This metric is measured in the number of “foreclosure starts”, which is the first public notice of a foreclosure getting going. 

In the first half of 2022, foreclosure starts were up 219% according to data from ATTOM Data Solutions. This jump was seen across all markets, with 96% of metropolitan areas in the United states seeing an increase in the number of filings for foreclosure by lenders. Top states for foreclosures include New Jersey, California, Ohio, Illinois, Tennessee, and Florida.

Is this huge increase indicative of something really going wrong in the economy? That’s unlikely. During the pandemic, moratoriums on foreclosures prevented lenders from being able to foreclose on residential mortgages. The huge increase in foreclosure starts is more representative of a climb back to foreclosure rates that we experienced before COVID. According to historic data, the US. The foreclosure rate is still below what it was prior to the pandemic. 

Though the mid-year totals for 2022 seem high, they still aren’t close to the mid-year totals for 2019, the last year that we have data for that’s not affected by COVID foreclosure moratoriums. The loans that are being foreclosed on now are by and large homes that were already three months past due before the pandemic. 

The pace of foreclosures is going up certainly, but it’s nowhere near the kind of levels that economists would be concerned about. Not yet, anyway. The real question will come when the current backlog of mortgages that are already past due start to come around. Since the current round of foreclosure starts are largely made up of loans that were behind through the pandemic, they aren’t a clear indicator of where the foreclosure rate is right now, but rather they’re an indicator of where the foreclosure process was two years ago. 

The massive shift in employment rates, with job openings at an all time high, has blunted the number of real mortgage defaults. 

This rise in foreclosure rates is actually good news for buyers in the tight market that’s been an impossibility for the last couple of years. High rates of foreclosure will open up inventory that has been frozen due to these moratoriums. Once those homes are through the foreclosure process, they’ll come back onto the market and provide some relief for homebuyers who have been unable to find open houses. 

This reality makes the whole process a double edged sword. A higher number of residential properties being foreclosed on is a tragedy for those families who are losing their homes, but it’s an opportunity for other homebuyers who have been unable to find homes due to the tight housing market.

All in all, the market is balancing out, and part of that is necessarily tied to foreclosures coming back up to pre-pandemic levels. The numbers are dramatic, absolutely, but they aren’t unhealthy. The economy is slowly coming back to where it was without the artificial limits placed on it by pandemic safety nets, and overall that’s a good thing for the housing market. 

Essential Facts About Home Inspection for Sellers

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Home inspectors are a part of the real estate process that’s baked in, and for good reason. Even when someone lives in a house, they might not realize when things go wrong behind the scenes. Bringing in a home inspector means unearthing potential problems and getting a good bead on issues that might be on the horizon. 

  • Attend your home inspection

Though most home inspectors will perform their inspection while you’re away, it’s a much better idea for you to be present. This way, you can ask questions and give them context about what the issues are, as well as potentially giving you recommendations about which professionals will be able to do the work. 

  • Start with a generic list

One solid tip is that you can start off with a general home inspection list that you do yourself. With this kind of knowledge in hand, you’ll be able to ask the inspector questions and you’re less likely to be blindsided by their findings. 

  • Expect to pay for an inspection

Home inspections overall will cost around three hundred dollars. This gives you not only the time and expertise of the home inspector, but they will also provide you with a written report detailing their findings. 

  • Get a home inspection early

A home inspection will help you be able to price your home effectively and to know what opportunities you might have for repairs. Not only that, but a home inspection can help you sell your home to potential buyers, who will take solace in knowing that you’ve done the right thing.

For a home seller, a home inspection can be a great tool for getting the most value out of a home. Learning how and when to use a home inspection can help you to know whether and how much you should rely on it will save you time and money, and it will also give you peace of mind. 

Michigan Property Taxes are Rising – How High Will They Go?

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Inflation is hitting Americans hard all over the country, and many families are struggling to keep up with constantly rising costs. In many parts of Michigan, property taxes are now going up as well, representing a doubling down of increased costs for homeowners in those areas. 

Property taxes in Michigan are based on the assessed value of a home, not on what a homeowner is paying in their mortgage. With the huge increase in property values over the last couple of years, homes all over the country, including in Michigan, are now worth dramatically more than they were when homeowners purchased them. That value isn’t reflected in the income of these homeowners – in real terms, it’s just on paper.

Fortunately for homeowners, Michigan caps the amount of taxable value that a homeowner can withstand to just five percent in a tax year. That’s good news for homeowners, as many homes have seen much bigger jumps in value recently. Michigan has stricter limits on property tax increases than most of the rest of the country. It limits property tax increases from three angles – levy limits, assessment, and rate. This use of three different methods to limit increases is unusual, but it’s good for homeowners. 

Even with that cap, the average homeowner in Michigan is going to see a 3.3% increase in their property taxes thanks to recent recalculations. Urban areas in the state are seeing the highest tax level, but places like Detroit are already levying some of the highest rates in the state, so there’s not much room for growth. Unfortunately, homeowners who are in the lowest income brackets are likely to see the highest leaps in property taxes. 

The current jump in property taxes across Michigan is the highest increase since 2009, and those who have recently bought homes are going to experience higher increases than homeowners who have long held mortgages. 

As property taxes in Michigan are tied to inflation, homeowners should continue to expect property tax increases as long as inflation rates continue to go up. Michigan calculates its property taxes on homeowners twice a year. In six months, these rates are likely to increase again, something that homeowners should be prepared to pay for. 

Ask Connect: How do I sell an off-the-grid property?

Off-the-grid property for sale in Joshua Tree

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This section includes real questions from real homesellers, plus our answers. 

Dear Connect,

For the last decade, I’ve owned and renovated an off-the-grid property about two hours from Charlotte, North Carolina

It started out as a rustic cabin in the woods outside of Asheville, with little insulation and no foundation. Since then, I’ve dug a well and built a beautiful outhouse, plus added a camp shower and put the home up on a foundation. I’ve put a lot of work into making it a beautiful place to retreat to, putting on a tin roof and installing modern insulation to keep it warm in the winter. There’s a wood burning stove inside and a propane grill on the porch. Inside, it’s cozy and clean, with lots of light and modern amenities – except for electricity.

Even with all of those improvements, I’ve chosen not to run electricity to the property and it’s free of wifi signal, though there is reliable cell phone service. If you didn’t know it during the day, you’d look at the house and think it was a wired cabin. 

Though I’ve loved having this haven for my own use for the last few years, it’s time for me to let it go. In an ideal world, I’d sell it to someone who would keep it off the grid as it is, but I know that’s unrealistic. In the real world, I’d like to at least get my investment back out of it. 

Is it possible to sell a house that’s off the grid but is well finished for a solid price? It’s such an unusual property that I’m unsure about what to list it at, and the realtors I’ve spoken with in the area are not much help. Another issue is that it sits on 10 acres, and I know that the property itself is going to have a substantial value  

Sincerely,

Off the grid but in the market

First off, great work on putting all of that into what sounds like an incredible property. 

I cannot see that you’ll have any trouble selling this house or the piece of property if it’s in the kind of condition you say it’s in. Though these properties are unusual, you’ll want to keep in mind that they’re also highly desirable. You’re not selling a fixer-upper. This is a property that has lots going for it, and the acreage is no small thing in that area of North Carolina

All that being said, you want to keep in mind that the most likely outcome is that your property will end up in the hands of a developer if it’s near Asheville and it’s that big. Your little cabin that’s off the grid is likely to be laid low in deference to a string of glowing houses with neat yards. I’m sure that’s not what you want, but it’s unavoidable if you sell. You could potentially spin off the property and sell the cabin separately, but that’s no guarantee that the cabin will stay intact. 

The most likely thing that you’ll see is a huge interest in your property. My advice is to list it and see what happens, then let yourself be surprised by the interest. If you need to sell it faster for whatever reason, there are plenty of investors who would offer you cash for the property to get it off your hands quickly. You’ve got all the choices here! 

Why You Should Consider Your Options Before Signing with a Realtor

Florida real estate agent

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With home values continuing to increase and technology constantly changing how we buy and sell everything from toilet paper to cars, people who are thinking about selling a house are looking for the best ways to make the most of their investment. If you’re thinking you might want to sell a house without a realtor in Florida, you’re right in line with lots of other homeowners in the Sunshine State.

Though alternatives to real estate agent sales can seem so out of the box that they’re not easy, what you’ll find here is that other paths are not so intimidating. They also offer you the chance to reduce commissions and still get a good deal for your home. While these alternatives aren’t for everyone, it’s worth the effort to explore what’s out there.

Selling without a Realtor vs. with a Realtor

Couple in Florida shaking hands with a real estate attorney

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What a real estate agent offers you, in essence, is their expertise. They’re giving you support on pricing, marketing, and negotiating with buyers. The other thing, the more tangible thing, that they’re delivering to you are potential buyers.

Online resources can be helpful on your path to selling your Florida property without a realtor, but the amount that you’ll learn online about how to do everything will vary by industry and by your specific needs. Depending on your situation, the information that an agent offers you may not be accessible to the public.

Hiring your own seller’s agent to help you negotiate real estate transactions will definitely make the home sale in Florida easier, there’s no doubt about that. The entire process of selling a house in Florida is complicated and necessitates either a level of expertise or hiring someone who has that expertise. Without a realtor, you’ll have to figure it all out yourself.

Understanding real estate commissions

When you sell your house with a real estate agent, they earn their money by taking a fee at the time that closing costs are put together during the final real estate transaction.

For most people, the most important benefit of working outside the real estate agent structure is saving money by avoiding commissions on the sale of their Florida property. Real estate sale commissions are usually calculated based on the price that a home sells for.

When you, the Florida homeowner, signs on with a seller’s agent to get your home on the market, marketed, and sold, you agree to a price upfront. This price will come in the form of a percentage of the property purchase price.

If there is both a buyer’s agent and a seller’s agent, then a split commission will happen. Both real estate agents will be paid for their work, but it will all come out of the purchase price of the home. Buyer’s agents get their commission written into the sales contract, just like seller’s agents.

This is not something that you, the homeowner, will have to deal with. Whatever commission you negotiate with them at the start of the process is what their commission will be.

Calculate real estate commission

To calculate how much you’d pay in real estate commission, you need a simple equation. Take the percentage that you agree to, divide that whole number by 100, then multiply by the sale price of the home.

For example, if you had a home that sold for $300,000, but you agreed with your real estate agent that they would get a 5% commission, then your calculation would look like this:

(5/100) x 300,000 = $15,000 commission

That’s no small number, even in the context of something as major as a home sale. Note that this example uses a 5% commission, but that’s at the low end. A real estate commission can go as high as 8% in some markets, though the average is 5-6%.

It’s easy to see why people are so interested in forgoing the realtor selling model and trying some other ways.

Know the Florida real estate agent process

Florida family sitting with a real estate agent

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The process of buying and selling real estate without a realtor in Florida is similar to that of other states.

If you decide to go with a real estate agent, they’ll likely try to push you to sign a contract that gives them the exclusive right to sell your Florida property. This contract means that you’ll have to pay the listing agent their real estate commission even if you sell the house to a buyer that they don’t bring to the table. Even if you get a buyer without a realtor, you’ll still have to pay a realtor a commission.

The other option is for you to do what’s called an open listing, which is when a homeowner agrees to pay the commission to any agent who brings the final buyer in. This could include an exclusive agency listing, which gives any realtor in a certain agency the ability to make the commission off of the sale.

All home listings are going to be for a set amount of time. For Florida, a homeowner will generally list their house with an agent for a flat number of days, often 90.

Transaction brokers in Florida

In Florida, a real estate agent that represents both the buyer and the seller is called a “transaction broker”. This is obviously a conflict of interest, as the listing agent is negotiating with both the buyer and the seller.

This can only happen if all parties agree to the arrangement in writing, per Florida Statute §475.278. Through that arrangement, the real estate agent becomes a “transaction broker”.

This is an interesting situation because a transaction broker has a responsibility to the buyer and to the seller. Though two real estate agents usually work hard for their individual parties in a real estate negotiation, obviously in this situation they work differently. A transaction broker clearly has limitations on what they can do. Under Florida law, a transaction broker cannot put the interests of one party over the other. In addition, the Florida Statutes state that the real estate agent doesn’t have a fiduciary responsibility to both parties, which would be dual agency.

The ups and downs of using a realtor

Florida couple with a buyer's agent

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Often sellers find selling a house without a realtor is better than working with a real estate agent. Though all of the numbers point to the ability to save money and time by selling a home in Florida without a realtor, the vast number of people decide to use a real estate agent.

Homes sold without using a real estate agent can be sold for less than those that employ the services of an agent. If a homeowner puts out a listing price of 97% of the fair market value of their home, they’re likely to get a buyer much faster and get on with their lives after the sale. Though this is less money than they could get with a real estate agent, that undermarket listing price is still more than what they would get if a normal Florida real estate commission came out of that price. The homeowner nets two percent at least.

If you are unable to get your house assessed properly without a real estate agent this may mean a less expensive home. It can be extremely difficult to estimate and price a house without a realtor. Most real estate agents are very experienced negotiators, which means they usually know when offers will be worth the cost versus when they won’t be.

What are the options if you don’t sell with a realtor?

Florida FSBO seller signing a contract

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If you decide to try to sell your house without a realtor to save money or to see what you’re capable of, then you’ll want to know your options.

The home sale process in Florida might be foreign to you, but with some market research and using online tools to help you understand what steps there are in the process and what your opportunities are, you can get the right potential buyers to look at your home.

Option 1 – selling your house yourself

FSBO homes are a definite way to sell your house without a realtor. In this situation, you become your own agent and take on all of the roles that a traditional real estate agent would take on.

It may be simpler for you than for many fsbo sellers if you are flexible on the final sale price. Price negotiations are one of the hardest things to deal with, and most buyers come to the table thinking they have the advantage if they know you’re selling a house without a realtor.

Sellers are usually drawn to FSBOs for a number of reasons: they want to reduce agent commission cost, they want to get a home purchase through quickly, and they want to circumvent the existing real estate system.

FSBO sale offerings are relatively unusual in Florida, though they aren’t unheard of. You have to advertise and promote your listing, get an inspection and improve the property accordingly, take professional photos, organize tours, and hold open houses. To sell FSBO property is no small venture. Few homeowners will accept this task, nor are they willing to accept the lower price points they’ll get for the home, despite their ability to save money on the other end.

In 2020, FSBO sales were just 11% of home sales nationwide. Fortunately, even if you don’t have experience in marketing a home, creating a list price, or in fact with FSBO homes at all in order to get a successful sale. FSBO websites can walk you through most of the process for finding a potential buyer.

FSBO paperwork can be overwhelming

Paperwork can be an intimidating aspect of selling a home in Florida. For example, the amount of paperwork on a typical house sale is 180 pages! That’s a huge amount to go through and understand.

In Florida, there is a requirement that sellers must notify customers when the property has a defect. If you’ve had a home inspection and share that with you potential buyers, then this covers the legal requirement. If you, the seller, fail to disclose a known defect in the house, you could face possible legal and financial consequences. Paperwork risks are sometimes the primary factor in a homeowner choosing not to sell a home like this.

Option 2 – sell to someone you know with a real estate attorney

You don’t necessarily need to go through the whole route of acting as your own listing agent in order to get your home sold in Florida without a realtor.

One other potential option is to hire a real estate attorney. If you are selling a house without a realtor to someone that you know, then you don’t even need to act asy our own realtor. You essentially have a situation of an instant buyer.

Real estate attorneys can help you draw up a purchase agreement for a flat fee of less than a few thousand dollars. A good real estate attorney will be able to take care of all of the paperwork in short order and get the sale pushed through.

A lawyer with extensive real estate expertise may also help with the drafting and interpretation of countless documents such as real estate contracts, existing loan documentation, other loan documents, and every other kind of legal contract that goes along with the sale of a property.

Option 3 – agent assisted home sale

A method of selling your home that’s really outside of the box is to look into agent assisted home sales. Working with a realtor in some capacity, even if it’s on a consulting basis, can be really helpful.

Know that if you go in to ask an agent to work with you in this manner, they’re going to try to hard sell you on using their services. However, you can offer to pay them a flat amount to get the support you need to make more money on your For Sale By Owner property.

Another, related option, is to use a flat fee MLS service in conjunction with your other FSBO tactics. This is a means by which you can list your house on the Multiple Listing Service websites across the web without a realtor. Listing on the MLS is hugely valuable as it allows your home sale to attract buyers who would otherwise not see it.

The MLS is how homes get listed on Zillow and Redfin, which derive their home listings from this master listing.

Working with a real estate agent in this capacity can save money on fees while still giving you the benefits of saving money by selling without a realtor.

Option 4 – sell your house to a cash buyer

The cheapest and easiest way to sell your home is to work with a cash buyer.

Cash buyers come in many forms, from corporate cash buyers to individual home investors. A cash buyer is different from other potential buyers because they don’t rely on a down payment and mortgage system the way most buyers do. There are no legal risks to working with a cash buyer if you make sure that you get a proof of funds document from their bank before closing.

Cash buyers provide sellers a lot of ease through quick sales and lower fees than traditional home sales. Homeowners can expect to get a lower price for their home from a cash buyer, but they also don’t have to deal with a whole host of things like real estate inspections, home appraisals, and home repairs.

If you sell your home for cash, you’ll get a quick transaction that won’t require much if any negotiation.

The major difference between selling to a cash home buyer, using a FSBO listing, and selling with a real estate attorney is the amount of work that you have to do. In fact, with a cash offer there’s none of the red tape or negotiating that comes with other means of selling your house in Florida.

Real estate is a significant time investment

Choosing to go it on your own can be intimidating. A real estate agent has a way of giving many homeowners comfort through a major life change.

When you take on selling your home yourself, you’ll start asking yourself questions like these:

  • Do I have to take care of an open house today?
  • What house marketing tactics am I missing?
  • Is my listing price in line with the rest of the market in my area of Florida?
  • Did I email the professional photographer about getting professional photos of my house?
  • What time are the repair workers coming? The home appraiser? The home inspector?

When you work with someone from the National Association of Realtors in Florida, you’ll pay a flat fee in the form of commission to them for all of the work that they do in relation to the house. A realtor will install a lockbox on your house so that they can come to your home for showings even when you aren’t there.

Selling homes can take a lot of effort, and that effort can easily overwhelm even experienced FSBO sellers. Besides the paperwork mentioned previously, all of the marketing and home arrangement could mean selling the house is a full-fledged job. It’s a lot of unnecessary work that you may or may not want to take on.

Take the emotion out of the home sale in Florida

Couple getting the keys to a new home in Florida

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It can be emotional when you sell your home. This is a place that you might have lived for a long time, making memories with family and friends. Depending on your situation, it could also feel like a place that you just want to put behind you so that you can move on with your life.

One thing that real estate agents do well is to help you work through that emotion. On the other end, working with a cash buyer will help you get out of the house quickly, which can also help to blunt the emotional attachment that you have to the home.

All of the real estate professionals that you work with during this process should appreciate the emotional reality that you are living through when you sell your house. However, sometimes all of that emotion is the reason to do it yourself. Less people involved in the sale can be a good thing.

Knowing how much your home is worth on the Florida market

Whatever decision you make about selling your house without a realtor, make sure that you do your homework about the pricing on the home.

Look online for how much homes in your area of Florida have sold recently. Don’t rely on the valuations that you see on websites like Zillow, which are often inflated. Instead, look at the actual sales prices of homes.

Find the square foot average prices of comparable houses close by that can apply to your home. Also consider the unique features of your house or property in Florida, the conditions of the local market etc., as these can all influence the ideal selling price. FSBO houses tend to be cheaper when compared to other houses, as do cash home sales, so keep that in mind.

In a hot real estate market, your house may “sell itself”

If you’re living in an active housing market, which is what most of Florida is, you may not need a realtor simply because the market is so hot. In this case, it’s the buyer’s agent who will do the bulk of the talking and the buyer’s agent who will be eager to get the home secured for their client.

Home sales typically go well above asking price in a real hot market, so all of that marketing, staging, showing, and negotiation generally takes much less time. That’s not to say that you won’t have to do some work on the house, or that it’ll be a walk in the park, but you will have an easier time working with a buyer’s agent than you will in a cooler, buyer’s market.

What you decide to do with your home sale is very much a personal finance decision. You don’t want to find yourself losing money on a transaction, but sometimes getting the most money means looking outside of the traditional real estate agent model.

Selling a Hoarder’s House in Florida Doesn’t Have to be Gross

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Home is where the heart is, but sometimes home is where the junk is. The term “hoarder’s house” invokes an unlivable, chaotic mess of a place that makes your stomach turn. It’s a sad and depressing situation for anyone to live in, and it happens all too commonly in Florida and around the United States. 

If you’ve inherited a home that belonged to someone who struggled with hoarding, then it probably feels overwhelming. The sheer amount of stuff to deal with can be tremendous, in addition to everything that’s necessary to sell an inherited home under normal circumstances.

Once you do decide to sell a hoarder house, you’ll have to figure out how to get through it without feeling either physically grossed out or emotionally disgusted. Selling a hoarder house in Florida doesn’t mean you have to tackle it all yourself.

The decision to sell a hoarder house

Packing up a hoarder's house in Florida

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When an inherited house in Florida has major problems, like needing structural repairs or being a hoarder house, it can make it seem impossible to sell it. If you’re the new owner, you might think that you can’t sell a hoarder house quickly, if you can sell it at all.

For many people who become unexpected owners of a hoarder house, they feel like they have to take it all on themselves. It’s a misconception that prospective buyers won’t buy a hoarder house fast. In fact, real estate investors welcome hoarding houses in Florida. Licensed real estate agents can also work with you to help you sell a hoarder house as is.

It’s not just the hoarder’s house

A hoarder house that’s been left to you holds a lot of stuff, but it also holds a lot of stress for the family members who have to deal with what’s left behind.

The emotional turmoil that comes with losing a loved one is a lot to deal with already. Hoarder homes in Florida have a massive added layer to the emotional challenges because they leave homeowners with trash, items pile up, and potentially a house unsafe to live in.

Selling a hoarder house without taking the time to go through everything can leave you wondering if you’ve missed valuable family heirlooms or other items that you’d like to keep. It’s complicated, and it’s important that you work with a real estate agent or real estate investor that appreciates that it’s not just the hoarder’s house itself that makes it hard.

Hoarding disorder

Woman packing up papers from a hoarder's house in Florida

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Though there’s a great deal of shame associated with hoarder houses, and to get to this point almost involves someone struggling with a mental disorder. Hoarding is an outgrowth of anxiety and depression, but it’s a recognized disorder by the APA on its own. 

When a person has a long term, persistent problem parting with their possessions because of a compulsive attachment to them, they can become a hoarder. There’s a frenetic push for them to hold onto their stuff. Getting rid of even the smallest things can make them spiral into a panicked and distraught state. 

They don’t hold onto these things because of an inherent value in the objects, but because of an emotional inability to part with them. 

Over time, a hoarder can create such a compacted living space that a home is filled to the brim with only narrow paths to allow people to go from one place to another. Every surface is piled high with stuff. This can start with objects that are thoughtful and reasonable, like clothing or papers, but eventually can transition to trash and cross over into dangerous living conditions

Not just the hoarder’s house itself

Hoarding can spread outside the home. Sometimes hoarders become so consumed with their stuff that it starts to collect in the yard and in outbuildings. 

If you’ve inherited a hoarder home in Florida, then you could be dealing with objects filling the home itself as well as objects filling other spaces like the shed, garage, storage buildings, and even just sitting in the yard.

When you want to sell a hoarder’s house in Florida, you’ll likely have to contend with layers upon layers of stuff not just inside the house, but outside as well. 

Necessary resources for a hoarder’s home

If you decide to try to clear out a hoarder’s home before you put it on the open market, you still don’t have to deal with all of the worst problems of the house.

It’s worth it to reach out to friends and family members first to find out if anyone is in the Florida area and can come help you sift through what’s inside. Keep in mind, you don’t have to go through everything in the home.

A cleaning service is an essential resource for dealing with a hoarder home. Another essential resource is a haul away company. These services come to hoarder houses and take away the stuff that’s inside.

Often, junk removal services come at a low cost or are free. If you’ve inherited a hoarder house, you also have the option of putting up a free yard sale online to let people come and take everything out.

A strategy for a hoarder house in Florida

Woman cleaning a Florida hoarder's house

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One good strategy is to take some interior photos, then walk away and go look at them when you aren’t in the midst of the mess. This will let you break down what kinds of items are in the house, what fire hazards there are if any, and even to look back at any possible structural issues that could be visible.

Taking photos will help you to tease out the emotional and physical reaction you have to the space while you’re in it. This is an easy task that you can do. It’ll also give you a resource that you can share with others who might work on the house with you.

You can split the process into stages. There’s the initial cleaning that has to happen, then there’s the process of going through the stuff itself.

If you hire a cleaning crew to take care of the deep cleaning, you can then choose to go through the stuff in the house before selling a hoarder house. A cleaning crew in Jacksonville or Tampa, FL can help you with the worst parts of the process.

  • animal feces removal
  • kitchen cleanout
  • garbage removal
  • bathroom scrubbing

Hiring professionals to help you do the dirty work is not just about perceived need, it’s an important step that will help with the sale of a hoarder house. Getting out from under a burdensome home that is causing emotional and financial distress is important for everyone’s wellbeing.

From cluttered to dangerous

A hoarder house can unfortunately cross from being full to being so filthy that it’s a health hazard to those who enter it.

The air quality inside could have deteriorated to the point that the hoarder home requires a mask to go inside. Holes in the floor from rotted wood or water damaged structural points can cause accidents. There’s also the risk of the piles of stuff falling down on someone who enters hoarder houses.

Hoarder property in FL can become a danger if there are structural problems that are hidden beneath the layers and layers of stuff. The sheer weight of the stuff inside can cause buckling of floor boards and warping of walls.

In many cases, it can cost more money for homeowners to repair and salvage a hoarder house than they will make from the sale of it. Deciding whether it’s worth your time to make necessary repairs to bring houses like this up to code before selling is a hard call.

Hoarded homes that have crossed into being dangerous, whether from being abandoned or from being lived in a brutal state, have to have repairs before they can be lived in again. The question is whether you want to make those repairs yourself, or if you want to sell the hoarder house and move on.

Years in the making

Abandoned hoarder's house in Florida

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Homeowners who are struggling to find a way to sell a hoarder house through real estate agents or real estate investors should start with making a plan. Whether this starts with cleaning the house and getting it fixed before you try selling a hoarder house in Florida, or if you dispense with the hoarder house as is by selling it to a cash buyer with no obligation from you, you deserve to get out from under the property.

A hoarder’s home can be sold just like any other property, but it’s all about finding the right potential buyers who know what they’re taking on and are willing to deal with the home as is. You can also opt to take care of the hoarded home’s issues yourself, but if you have time constraints or life pressures that require you to get out from under the house quickly, you can sell a hoarder house as is.

It took many years for a harder house to become so jam packed and full of commonly hoarded items, but that doesn’t mean that you have to hold onto it for years. Let someone else like a real estate agent or a real estate investor help you to take on this huge problem so that you can move on.

How to Sell Your Charlotte, NC Rental and Avoid Taxes

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Selling a house can come with a big tax bill. It’s one of the tough realities that’s all too often a surprise to people when they sell a rental home

Figuring out how to sell rental and avoid taxes legally is probably more straightforward than you think it is. It’s all about making your property sale in Charlotte, NC work for you in smart ways. There’s just no reason to pay too much in taxes.

Start by thinking seriously about the tax implications of the sale of any property before selling. It might seem like an afterthought, but looking ahead and understanding the logistics of paying capital gains tax on real estate will preserve your financial status in the long run.

The basics of capital gains tax

Couple paying capital gains tax

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First off, it’s important to understand what capital gains tax is. When a rental property owner is trying to avoid paying taxes on the sale of a rental home, the biggest tax you’re trying to avoid is capital gains tax in North Carolina. 

Capital gains tax is a federally assessed tax on the money made from an investment. Capital refers to the investment itself, or the “capital asset”. There are many forms that a capital asset could take, which could be shares of a company, real estate, coins or other collectibles, jewelry, bonds, and basically any kind of real property or asset that increases in value over time. 

Capital gains tax is a significant concern for investors selling a rental property, and with good reason. This federal tax represents a major cut into profits on the sale of a home. 

There are two kinds of capital gains tax:

  • Short term capital gains tax
  • Long term capital gains tax

Short term capital gains tax applies to investments that have been held for less than a year. They’re taxed at the rate of regular income tax for whatever tax bracket the individual falls into. This is a higher tax rate than most people will pay on long term investments. 

Long term capital gains tax applies to investments that have been held for more than a year. These are subject to a lower tax rate than those held for less than a year because the federal government wants to encourage long term investments.

Capital gains tax is only assessed when you sell an asset or piece of property. From the time you buy it to the time you sell it, that’s the time period that the capital gains tax is assessed. Though you won’t pay on your investment until you sell, the amount you pay when you do sell rental property is based on the increase in value across the whole time you own the property. 

For example, if you bought a rental property ten years ago in Matthews, NC for $200,000, then sell it this year for $300,000, you’ll owe long term capital gains tax on $100,000. 

Most net capital gains tax is capped at 15% for most individuals, according to the IRS.  

1 – Leveraging tax adjustments

Capital gains taxes being calculated when someone is ready to sell a rental property

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Tax adjustments are the things that knock down that tax cost. Adjustments include closing costs, settlement fees, real estate commissions, inspection costs, etc. Basically, every amount of money that is taken out of the profit from the sale of the home is eligible to be taken back out of the amount that the property is taxed on.  

The IRS also allows rental property owners to write off home improvements. If there was a remodel, if you treated and repaired termite damage, if you tore out a moldy bathroom or replaced a roof, all of those costs can be written off. This goes for the entire time that you owned the rental property. 

Remember that capital gains tax rate is assessed on the difference between the amount you paid for the house and the amount you sell the property for in Charlotte. Assuming the value of the property increased over time, you can knock down that positive difference with these adjustments. 

It’s worth noting here that if you show a loss on a piece of property over time, which is unusual but possible given a housing bubble, then real estate investors avoid capital gains taxes altogether. 

2 – Investment vs primary residence

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Most people who are selling a primary residence won’t have to pay capital gains tax on the profit they make from the sale.  An investment property is completely different.

The federal government does this to encourage home ownership. There is a prevailing theory among economists that it’s good for everyone when people own their homes rather than renting them. Home ownership increases generational wealth, gives people more discretionary money to spend, and in general raises the standard of living of the nation as a whole. 

It’s worth noting that recent economic trends are shifting. Increasingly, millennials and Gen Z are having some pushback against home ownership, both for economic reasons and philosophical reasons. Though small in scale, the push towards shared resources is growing among those demographic groups. 

If you converted your primary residence into a rental property and lived there for two of the last five years, then you are eligible to avoid capital gains tax completely. This is such a good strategy that some North Carolina investors make a practice of using this legal way to avoid capital gains tax on a cycle. They buy a home, live in it for two years, then rent it out for just under three years before selling. 

Getting the right rental property sales price is part of the equation, but real estate is about more than that. A rental property sale will ultimately help you recoup the investment, whether it’s been your primary residence for part of the time you’ve owned it or not.

3 – Minding the profit level

Capital gains tax only applies if you made less than a quarter of a million dollars on the sale of the home if you’re filing individually, or a half million dollars if you’re filing jointly with a spouse. This only applies if you follow the rule of living in the home for two years out of five, allowing you to mark it as your primary residence.

Don’t forget – that profit number is after you mark the profit down with the above adjustments from number one. For example, if you sell a home for $500,000 that you bought twenty years ago for $230,000, then you would make a $270,000 profit and have to pay capital gains tax on it if you’re filing individually, even if it was your primary residence. However, if you take out closing costs and other adjustments that total $30,000, then your profit is only $240,00 and you avoid paying taxes on that profit.  

4 – Writing off depreciation

Tax loss harvesting calcuations

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Improvements that you make to a home are a major way to lower the cost basis you pay on the profit of the sale. When you deduct the amount of money you paid for improvements on a rental property, that’s depreciation. Most people do this yearly to reduce their tax burden.

From the view of the IRS, the value of a rental home depreciated over 27.5 years. That’s

All of that depreciation that you’ve written off year after year doesn’t reduce the amount of capital gains tax you own, it actually increases the capital gains tax.

Your profit on the sale, according to the IRS, is calculated by subtracting the cost basis from the selling price. For example, if you purchased a home for $200,000 and paid $20,000 in title, sale, and transfer fees, then the value of the rental property is $180,000. That’s the amount that rental property owners would pay tax on when selling a rental property.

There are two ways to calculate depreciation on a piece of property.

  • tax assessment value
  • appraisal value

Using a tax assessment is the easiest way to determine the depreciation expense when selling a rental property, but these are not always in the best interest of the real estate investor. Hiring an outside home appraiser in Lincolnton or Rock Hill will have an upfront cost, but an appraiser will also give a more accurate value of the depreciation expense.

Once you calculate the depreciation expense, you can then figure out how much tax you’ll save. For instance, if you paid $200,000 for a piece of rental property and calculated that you’re allowed to claim $7,000 in depreciation, then in the end you’ll be able to pay taxes on the property as though you bought it for $193,000. In the sale, the $7,000 is viewed by the IRS as you getting that depreciation back.

You’re taxed on that recaptured depreciation amount of $7,000.

Calculating depreciation is complex and involves an intersecting understanding of time, IRS tax brackets, and loss harvesting. Of everything listed here to help rental property owners avoid paying tax legally, this is the piece that is most important for you to work with a tax professional to calculate.

5 – Military tax exemption

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The military often changes the location of an assignment, and when that happens, servicemembers have no choice but to move. The IRS recognizes that this makes it difficult for them to follow the 2/5 rule for exempting a rental from capital gains tax.

To accommodate this, the IRS offers an exemption that extends that doubles that five year period to ten years. This goes for members of the foreign service, intelligence community, and other members of the armed services in North Carolina and all over the country. 

The two year rule still applies, and the service member has to have been moved to a post that’s at least fifty miles from the qualifying home. They also have to have orders that send them on the new duty assignment for more than ninety days. 

This is a rental property tax avoidance strategy that every member of the military should explore. 

6 – Civilian relocation exemptions

It’s not just service members who can qualify for an exemption to the two-in-five rule. There are capital gains tax exemptions from the IRS for things like unforeseeable events, work relocation, and health events of homeowners.

There are specific guidelines for each kind of exemption, and you’ll want to follow them to make sure that you qualify for the exemption. Here’s the lowdown on each of them.

Unforeseeable destructive events

These are often focused on major events that affect not just you, but multiple members of your community. Think things like natural disasters – flooding, hurricanes, earthquakes, wildfires, etc. Other  thigns fit into this category as well, like terrorist attacks or manmade events. The pandemic offered a great deal of tax exemptions as well. None of these are something that anyone wants to face, which is why the IRS offers tax relief. 

Unforeseeable personal events

It’s not just large scale events that can help you avoid paying taxes on the sale of a rental property. Personal events like becoming legally separated or divorced, having twins or multiples in a single pregnancy, or if someone living in the home has passed away. 

Loss of income or new unemployment

A change in employment status is a reason to apply for a tax exemption on capital gains tax from the sale of a rental property. If the change in employment causes you not to be able to cover basic living expenses, whether that’s because you’re unemployed or because of a reduction in your salary, it could qualify you for an exemption from the IRS. 

Relocating for health reasons

If you or someone living in the home has to move for the diagnosis or treatment of an illness or injury, it’s possible to get an IRS exemption for capital gains tax. A doctor has to offer documentation of the necessity of the move for that reason. The exemption also applies if you have to move to provide personal care or medical care for a family member. Again, not a reason anyone would like to have a tax exemption, but worth looking into if you might qualify when you sell your rental property.

Relocating for employment

Similar to the service member exemption, the job relocation tax exemption applies if the new job is at least fifty miles further than your current job. For example, if your current residence is five miles from your job, then your new job has to be at least fifty five miles from your home. This also applies to unemployed homeowners who get a job that is at least fifty miles from your home.

Investment exceptions

Finally, let’s talk about investment exceptions.

Rental property owners who have a higher level of income are possibly responsible for paying net investment income tax. Most often, if you fall into this bracket you’ll know it, however if you’re close, you might not realize just how close you are and that you need to evaluate this tax.

If you do owe net investment income tax, then you’ll be responsible for 3.8% in additional taxes on investment income, including investment property that you use as a rental property. This includes capital gains and as well as taxable net income from investments.

When an investor’s modified adjusted gross income, including capital gains, is higher than certain thresholds, they owe this tax. The limits are $200,000 for someone who is filing as a head of household or is single, $250,000 for couples married filing jointly, and $125,000 for those married filing separately.

Why illegally avoiding rental property tax is a bad idea

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It should go without saying, but trying not to pay tax that you owe through any means that’s not totally above board and in line with the IRS tax code is fraudulent and a terrible idea.

Rental property offers a lucrative and potent way to make income, but that income is meaningless if you go to jail for tax fraud. Real estate investing in a smart way for business or investment purposes can make those rental properties worthwhile and profitable. Financial planning for Charlotte, North Carolina investors that includes a firm understanding of the tax rate from the Internal Revenue Service on selling a rental property will make it easier to avoid doing something shady.

The best way to go about it is the same way many real estate investors do – educate yourself on tax rates and the Internal Revenue Code, then hire a qualified real estate tax professional to help you pay the least tax on rental property.

It doesn’t matter if you own just one investment property and are far from the top tax bracket, finding the best tax solutions for your situation is something a rental property tax accountant can help you with. Working with a professional will not only help you avoid paying too much in taxes, it’ll also help you avoid getting audited by the IRS or worse

Selling rental property is hopefully a means to recoup some of the investment that you’ve put into the rental real estate. A tax bill might be necessary, but home investors should never pay more than they have to.

Behind on Payments? Selling Your North Carolina House in Mortgage Default

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What happens when you get behind on mortgage payments? Falling behind on a mortgage loan doesn’t have to mean going into foreclosure. Selling a house in default in North Carolina is one way to get back on track.

This is one of the scariest things that can happen to a homeowner. A home is the largest financial investment that most people will make in their lifetime, and the potential of losing that asset looms large for homeowners who are threatened with foreclosure.

Being proactive will help to keep the home loan intact for as long as possible. Whether this is to allow for the sale of the home or to try to catch up the mortgage payments is up to you. What’s important to know is that there are options for homeowners in default in North Carolina.

Defining mortgage default

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It often starts off small, with a payment that’s just a few days behind. Most homeowners try to hold on as long as possible, making payments when they can as they juggle other financial needs. Default doesn’t just happen with a mortgage loan – it can happen with student loans, credit cards, car payments, or personal loans too.

Once you are behind on payments by at least thirty days, you’re in default.

The timeline on a default sale in North Carolina

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There are federal laws that specify how NC homeowners get protection during default and foreclosure. The timeline for a default sale is based on those federal guidelines.

A homeowner must be at least four months, or 120 days, past due on their mortgage before a mortgage lender can initiate a foreclosure. During those four months, the homeowner retains their right to the property. 

The deadline for a sale before foreclosure in North Carolina isn’t 120 days, though. In fact, the homeowner has even more time. 

Because NC is a non-judicial foreclosure state, the process doesn’t have to go through the court system. The longer timeline for an NC foreclosure means that homeowners have more of a chance to either keep their home or sell their home in default. 

When the mortgage is more than you can afford

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If you tell the mortgage company in NC that the payments are more than you can afford for some reason, then you are eligible for a loan modification. This isn’t guaranteed, and it’s based on the amount of time that you’re behind on your mortgage and the specific terms of your loan. 

Any NC homeowner who is interested in loan modification can call their mortgage holder and request that their terms be modified to help them get through a rough patch. This is called loss mitigation, and homeowners facing hardship can ask for an application. 

Financial trouble is common

Life happens to everyone. Whether it’s from medical bills or a downturn in the economy, for lots of people, the loan payments they originally agreed to can become too much.

To get a loan modification after you have received a notice of default, you’ll likely need to prove financial hardship. This might involve showing that you’ve had to get public assistance, providing statements of unemployment benefits, or even showing the lender your bank statements.

When the mortgage lender agrees to loan modification, it’s because they don’t want ot have to place you on foreclosure notice. Though this is not a benevolent act, it is beneficial if you’re in financial trouble.

North Carolina has a history of helping homeowners get out of pre foreclosure when possible. Look to community and state funded resources to help you avoid foreclosure proceedings.

Mortgage relief programs in NC

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North Carolina has some programs that can help homeowners keep from being foreclosed on. When your mortgage crosses into default, that’s a good time to start to reach out to these programs and find some relief.

It’s important to note that participating in these mortgage relief programs does not exclude the homeowner from selling your home in pre foreclosure. There may be some time constrictions that will delay a sale slightly, depending on the terms of the loan modification. These time constraints aren’t long though, and they don’t materially impede the ability to sell the house.

Housing relief programs in North Carolina support homeowners in financial hardship, and they often require proof of some financial struggle. This could be a job loss, a military transfer, the onset of a disability, the death of a loved one, or any number of other problems that would prevent a homeowner from paying their mortgage payments.

For homeowners in default with missed mortgage payments or who are already in foreclosure, there are three main services in North Carolina to help.

  • State Home Foreclosure Prevention Project
    This free mortgage service in North Carolina offers free financial counseling surrounding mortgage debt. It’s provided by the North Carolina Housing Finance Agency and is available across the state.
    This group can also get you in touch with no cost legal services if your income qualifies. For someone in financial trouble, this can be a godsend when trying to avoid foreclosure. Particularly in the early pre foreclosure process, there are lots of options.
    All over North Carolina, these foreclosure prevention services are provided through HUD-approved housing counseling agencies.
  • Housing Stability Counseling Program
    NeighborWorks America has created a program that offers financial hardship counseling services to North Carolina homeowners who need support in pre foreclosure. These free consultations connect North Carolina homeowners in default with mortgage payment resources and restructuring ideas.
    Not only does this help connect with programs in the state of North Carolina, but it also helps put homeowners in touch with national and local relief groups that can help.
  • North Carolina Homeowners Assistance Fund
    The largest aid organization for homeowners in pre foreclosure in North Carolina is the NC Homeowner Assistance Fund. This $273 million dollar allocation was created to prevent mortgage defaults, foreclosures, mortgage delinquencies, and evictions in the state.
    Created during the pandemic, the Homeowners Assistance Fund is for homeowners whose primary residence is in North Carolina. It covers mobile homes, condos, and single-family homes.
    This fund can help to catch up on late mortgage payments for first and second mortgages. It can also cover other costs like fees and extras that accumulated during a delinquent mortgage period or a mortgage forbearance.
    This fund extends all the way to costs related to home ownership like mortgage insurance, HOA fees, and even property taxes.

Always remember, when you own a house in North Carolina, it’s your property. You have the right to sell a house in default, or in fact to sell your home at any point.

How do you sell a home mortgage default?

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The question of selling a home in pre foreclosure or mortgage default depends first on if the house is worth more than the amount you owe on the mortgage. This piece of information is critical to getting back on track.

A mortgage loan is considered underwater if the property itself is worth less in fair market value than the amount owed to the lender. When the market’s fair price is lower than the home loan, that’s when it becomes problematic.

At that point, the loan might need to be rehabilitated in order to help the homeowner get out from under the debt. Foreclosure is also a possibility for an underwater loan, though its not guaranteed by any means. Mortgage lenders don’t want to foreclose if they can help it, as it costs them more money to take back a house than to keep you in it.

How a short sale works in North Carolina

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When a house is sold for less money than the mortgage balance, it’s called a short sale. In North Carolina, a short sale is a way to keep a house out of the foreclosure process. Per NC housing regulations, you typically have to have the permission of your lender to do a short sale when your house is in default.

The lender has to be on board with a short sale because it necessarily means they’ll be taking less money for the home than what they’re owed. Usually, the funds that come in from the sale of a home go directly to the lender’s attorney and their bank. These funds need to be more than what the owner has been loaned so that the title is free and clear for the new owner.

In a short sale, the lender agrees to take less than what they’re owed. When the payoff comes in from the sale of the home, they mark the note as paid, even though it’s not. Again, this allows the new owners to have the title free and clear.

Steps in a short sale

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If you sell your home with a short sale, it will look much like if you sold your home in a traditional real estate sale. The difference is that you’ll want to communicate with the bank about your situation so that they can approve the short sale in North Carolina.

It starts out with finding someone to buy your home. That might mean reaching out to a cash offer real estate investor, or it might mean going with a real estate agent. Both of these paths are about finding a buyer who will meet you at a price that you can make work.

Once you’ve got a buyer, you’ll accept an offer and work through any contingencies that are baked into the deal. For instance you might need to make repairs or complete a home inspection. Everything works just as it does with a traditional home sale, with one exception – every bit of the proceeds go directly to the lender.

Timeline of North Carolina short sale

How long a short sale takes in North Carolina has to do with the complexity of the transaction.

Though there is nothing inherently different about a short sale in NC than a traditional home sale in that the process involves a mortgage lender being paid in full to sign over the title of the home to a different owner, there are added steps.

The original lender has to review the offer for a short sale. This is true whether the short sale comes as a cash offer from a home investor or if it comes through another lender. When the lender has agreed to do the sale, then the transaction can keep moving forward.

Note that it’s possible for the lender to stipulate that additional actions be taken in order for them to approve the home sale.

Sometimes, a lender will decide that they can make more money by going through with the foreclosure process. This is a tough blow to families who are trying to avoid foreclosure. Continuing to negotiate with potential buyers and the lender can go all the way up until the sheriff’s sale proceeds.

It’s possible to shorten that timeline of a short sale by working with an experienced real estate agent who knows what the process entails in North Carolina. A real estate law firm who has worked on short sales in the past can also be a big benefit here.

A cash buyer or real estate investor who has experience with short sales can also make things go faster and smoother. They’ll know what’s necessary in your county in North Carolina, whether it’s Mecklenburg County or Halifax County or anywhere in between.

Jumping through the additional hoops that are needed to make a short sale work is difficult, but it’s worth it if you’re in pre-foreclosure. Most of all, it’s a matter of negotiating effectively between the mortgage lender, the homeowner, and the potential buyer.

A short sale in North Carolina can take anywhere from a couple of weeks to a couple of months, depending on the details of the transaction.

Why do lenders agree to short sales?

It might seem strange that a mortgage lender would agree to take less than the amount of money they are owed on a home loan. Wouldn’t it make good business sense to go after the full amount that they’re owed?

In a perfect world, the lender would work through loan modifications and help the homeowner figure out their financial difficulty so that they could get current on the loan and pay the full amount. That’s a wonderful theory to think about, but it’s not reality.

A mortgage lender is in the business of lending money, not managing property. Real estate owned by banks does not make money. Sale proceeds from a house that’s sold at a foreclosure auction or a trustee’s sale are always going to be less than the fair market value. Not only that, but through the NC foreclosure process, the asset manager negotionats with a prospective buyer or buyers to get the house off the books as quickly as possible.

The longer a lender owns a property, the less money they make on it. Most lenders are anxious to get on with a trustee’s sale to whichever qualified buyer will give them the highest price at the fastest pace.

A mortgage lender agrees to a short sale, whether it’s through an experienced real estate agent or with a real estate investor. They’re willing to take a loss on the money the homeowner owes them because they know that it’s more likely that they’ll recoup their investment this way than to let foreclosure proceedings go forward.

North Carolina is a non-judicial foreclosure state, so the courts are not necessarily involved in selling your home if it goes into foreclosure.

What do buyers get out of short sales?

When a potential buyer decides to go for short sales, they know what they’re getting into.

Though short sales might sound like a great bargain, and they can be sometimes, people facing foreclosure generally have financial hardships that have prevented them from keeping the property well maintained. A short sale is almost always a fixer upper, leaving the buyer with repair costs and extra expense before the house can be usable.

It’s not just the state of the house that’s at issue. A short sale property often has significant red tape between the buyer, the owner, and the mortgage lender. It’s even possible that a lender will require extra fees and closing costs to be paid by the buyer, rather than being paid by the seller in a traditional real estate transaction.

Though real estate is business, it’s not all cutthroat. Many cash buyers get satisfaction from helping families facing foreclosure to avoid the long lasting setback that it can be for North Carolina families. They still need to make a sale that will work for them financially, but the moral benefit is not invalid.

The edge of the short sale

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Keep in mind that real estate commissions eat into the amount you have left to pay back your lender. This could affect whether the home sale is a short sale at all. Working with a cash buyer means avoiding high closing costs, and that could be the difference in how much debt is left, if any, after the mortgage is paid off.

If I want to sell my home pre foreclosure without having to declare bankruptcy or be responsible for the remaining balance on the loan, the best option is for me to find a buyer with the highest price and the lowest closing costs.

Selling during default and your credit report

Selling your home when the monthly payments are behind won’t affect your credit report any more than any other loan modification.

Damage to your credit report comes primarily from missed payments and charge offs, at least in the realm of mortgage lending in North Carolina.

A short sale will put a hit on your credit report if you sell your home loan, but that’s because of the missed payments, not the sale. What the short sale can do is to stop the clock on any further missed payments.

Credit bureaus don’t drop a credit score until a payment is 30 days or more behind. This means that any payment made after the due date on the loan but before the thirty day mark won’t impact your credit. The problem comes when a mortgage payment gets thirty, sixty, ninety, or more days past due.

A short sale can pause the negative impact on your credit score, preventing the problem from getting worse. It’s much less damaging to have a short sale show up on a credit report because it’s reported as “paid in full” rather than as a charge off. This is a major factor in your ability to get a loan in the future for a home.

Note that it’s the responsibility of the homeowner to check their credit report and make sure that the lender has reported it appropriately. It’s not uncommon for lenders to misreport a home loan that’s been paid off rather than charged off.

This is a great place to engage with a credit counselor to help you figure out what steps you need to take to make the best of the situation.

Making the best out of a mortgage default

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A home going into default does not mean a foreclosure sale is inevitable. A notice of default is relatively early in the foreclosure process, and it represents a great opportunity for homeowners to take control back of their loan.

A notice of default should be a wake up call and a jolt that spurs you into action. There are so many options for homeowners who want to avoid foreclosure. This could be a short sale, working with mortgage lenders to modify the loan, or getting some financial hardship aid from the State of North Carolina. The bottom line is that foreclosure doesn’t have to be your future.

If you need to sell your home in North Carolina in default, explore what your short sale options are. You might be able to preserve your financial situation in a more positive way than you thought, helping you to take the next step in your life following this bump in the road.

Top 5 Strategies to Avoid Foreclosure in Tampa

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Florida is ranked second in foreclosures in the United States, right behind California. Across the country, including in Tampa Bay, the rates of foreclosures continue to rise. Finding ways to avoid foreclosure in Tampa is important for homeowners facing the loss of their home.

Foreclosure starts small

Foreclosure in Florida starts with stacks of bills that indicate a late payment. Notices that a mortgage is behind are only the start of the foreclosure process, and fortunately, there’s a long way to go before homeowners are evicted from their homes.

These five strategies to avoid foreclosure Tampa will help you to make the right decision for your home and keep you from going through a foreclosure sale.

1 – Call your lender now

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Financial institutions have a vested interest in keeping people in their homes. Rather than waiting for foreclosure prevention to fall into your lap, be proactive and reach out to speak to your mortgage lender about the unpaid portion of your loan.

The letters and phone calls about pending legal action are intimidating. Struggling homeowners in Tampa understandably want to just ignore them and try to put their attention on doing it on their own, but that’s not a good strategy.

Two ways to contact your lender are:

  • reach out via phone to the help desk at your mortgage company
  • chat online with mortgage support staff

Both of these methods will offer you immediate answers about what your options are. Even if you’re planning to pursue a short sale or are working with a cash buyer, go ahead and talk to your lender as soon as possible.

The sooner you start talking to your lender and making a plan to repay the loan or sell the home, the less likely it is that foreclosure will have a huge negative impact on your financial reality.

2 – Connect with Florida mortgage support agencies

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Tampa has a wealth of resources for homeowners who are not able to maintain their financial life. Not only will they give you a free consultation to help you figure out where you are, they can also put you in contact with other financial institutions who can provide even more support.

Foreclosure has impacted residents significantly in Florida. The United States federal government operates satellite programs out of the Office of Housing and Urban Development section that are available in Tampa Bay, Florida. Under Florida law, residents can utilize these services to help them find ways to pay for the mortgage or pursue legal action that’s appropriate.

Two places to check for foreclosure support are:

  • The City of Tampa’s foreclosure prevention office
  • The Office of Housing and Urban Development

Many of the HUD programs are woven into the amount of value that’s in the home as opposed to what’s left on the loan. In today’s market in Florida, most homes have appreciated significantly. Homeowners in this housing market can often avoid foreclosure in Tampa if they are willing to be proactive and work with a government agency.

HUD is a prime example of a government agency that can provide credit counseling and financial support. The eligibility requirements for HUD services are on a sliding scale based on financial needs, and they’re available right in the city of Tampa.

3 – Save your way out

Man working on side hustles to avoid forclosure in Tampa

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Pulling back your spending and thinking creatively about how to catch up your mortgage is one real way to prevent foreclosure in Tampa. This is the moment to pull back every bit of spending as much as possible, leaving you with just the bare bones of what you have to have to survive.

Remember that a few months or a year of financial hardship might be extremely stressful, but it doesn’t mean you’ll live like this forever. Some troubles are best solved by knuckling down and getting through them.

Look for side hustles to make extra money that you can put back into the mortgage payments. This could be driving for Uber, delivering DoorDash, or even taking on a part time job. While it might be well out of your comfort zone and could even be humiliating, losing your home would undoubtedly be much worse.

There’s the idea of taking on a side hustle, which is one of the best ways to earn some cash as you mortgage payments refinance, but there are other possibilities as well:

  • Sell furnishings, including appliances and decor
  • Ask for a loan from family or friends

Oftentimes, catching up payments that are behind is the hardest part. There are major fees and extra interest that factor into what a homeowner owes in default. Getting all of that back on track through loan modification or extra income is usually the hardest part for homeowners.

4 – Rent out your home

Homeowners renting out a house in Tampa, FL to avoid foreclosure

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One of the most creative ways to avoid foreclosure and catch up your monthly mortgage payments is to rent out your home.

This could mean that you’ll have to find somewhere else to live while you work out a home affordable refinance program, or it could mean that you use part of your home as an Airbnb rental while you’re taking the next steps.

The property address that has a loan unpaid on it is likely worth more as a rental to you in the short term than staying in the home. Reducing monthly payments you owe on the house by renting it out temporarily might be the best way to catch up, whether you have a fixed rate loan or an adjustable rate mortgage in Florida.

Renting your house might cause additional problems as well, like damage from renters or expenses from moving. What you’ll need to decide is if those costs are worth keeping your house out of foreclosure sale.

5 – Sell your home

The most permanent way to keep your home out of foreclosure is to circumvent the process altogether and find someone who will give you a fair cash offer to sell your home quickly.

The mortgage provider doesn’t want to take ownership of your property address in Tampa. It’s absolutely paramount that you make a smart decision here to avoid the same troubles that go the mortgage payments behind to start with. Selling your home is one potent way to do this.

Though it might feel like you’re choosing to abandon ship when you sell your Tampa home in foreclosure, it’s also a viable and long term solution.

Be strategic, but move fast

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Whether you want to keep your home out of foreclosure by selling your house, getting support from Uncle Sam, or hustling to take control of this stressful situation, you have options.

Tampa homeowners who want to keep their house out of foreclosure need quick tips, but they also need decisive action. It’s extremely important that you make a smart decision, and that you make it as soon as you can to avoid foreclosure.

What You Need to Know About the Eviction Process in North Carolina

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The eviction process in North Carolina can feel overwhelming and incredibly intimidating. It’s a legal process, and from the perspective of the tenant, it means losing your home. Here’s everything you need to know about eviction in North Carolina.

This guide will give you an in depth understanding of the eviction process in North Carolina, from start to finish. Towards the end, you’ll find a glossary of terms that will be helpful for anyone facing eviction. 

Court eviction in North Carolina

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In NC, evictions are handled through the court system. Specifically, eviction cases tend to take place in small claims court as they are for less than ten thousand dollars. There can be cases where NC eviction cases are for more than ten thousand dollars, but this is unusual for individuals.

Small claims court for eviction in North Carolina only involves a judge, called a civil magistrate, the landlord, and the tenant. 

There’s no jury involved, and it’s not required for anyone to have a lawyer. Sometimes a landlord will bring in an attorney, but more often everyone represents themselves as there’s not enough money involved to justify the attorney’s fees. However, a tenant is legally allowed to have an attorney in North Carolina should they want one.

The trial itself will take place at the courthouse in the county seat of the North Carolina county where you live. For example, in Halifax County, that would be the courthouse in Halifax. In McDowell County, it’s at the courthouse in Marion. In Forsyth County, it’s at the courthouse in Winston-Salem.   

If one of the parties does not show up to court, there is a default judgment in favor of the other side. North Carolina landlords usually show up to the court hearing as they initiate the eviction filing. When the tenant fails to come to court, they are responsible for repaying whatever the judge decides on the eviction filing.

NC eviction complaint and eviction notice

In the North Carolina eviction process, eviction begins when a landlord filed an eviction complaint. This is simply a claim asking that the tenant move out of the home. 

It’s common for the landlord to ask that the court force the tenant to pay not only rent that’s past due, but also late fees, money to cover property damage, utility bills, and court costs. The landlord can also ask for other costs as well. 

All of this is written up in a document that the landlord files in the county courthouse or magistrate’s office in your North Carolina municipality. Landlords can file this kind of paperwork themselves, or they can have an attorney do it for them.

Once the paperwork is filed, a copy is made that comes from the court itself. This is then served legally to the tenant by law enforcement or by certified mail. That’s to ensure that the tenant has been notified. 

The summons and complaint must be served to the tenant within five days of their being filed, according to North Carolina law.

Along with the complaint, the tenant will get a summons to court. This is a legal written notice letting the tenant know what day, time, and place the hearing will take place.

Advocating in court eviction

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It’s never a bad idea to get counsel before going into an eviction hearing in North Carolina. Though you are not required to get an attorney to represent you in eviction proceedings, unless you are extremely familiar with North Carolina eviction law, you’ll want some kind of counsel. 

Legal Aid of North Carolina provides no cost legal counsel to individuals for all kinds of legal interactions, including North Carolina eviction proceedings. Legal aid can help you understand the rental or lease agreement, give you insight into your possible counterclaim, and ensure that you are adequately compensated for any problems that were part of the claim. 

When going to eviction court, it’s important to bring supporting documents to shore up whatever claims you are making against your landlord. In North Carolina, the public is not permitted to bring cell phones or other electronic devices into an NC courthouse. You’ll need to print out any emails, text exchanges, or other documents that are relevant to your case. 

Organize your defense

It’s a good idea to organize your thoughts by writing them down so you can take them into court with you if you are defending against a landlord eviction.

Make sure you create a list of the following important points:

  • rent payments/rent receipts
  • property management interactions
  • rental agreement
  • lease violations by the landlord
  • eviction notices
  • interactions with the landlord

In district court, things move fast. this is not the moment to argue over the tenant’s personal property or the terse nature of communication from the property management company. Feelings have to take a back seat to explaining any past due rent and any time the landlord fails to repair essential items on the property.

Why NC evictions happen

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The heart of every eviction case is some kind of lease violation. Whether it’s criminal activity, when the tenant fails to pay rent owed, or holdover tenant problems. There are four instances when a landlord can file a summons and complaint for eviction under North Carolina Law.

  • Holdover – when a tenant stays on after the end of the lease term
  • Past due rent – when a tenant fails to pay rent
  • Lease violations – when a tenant doesn’t follow the terms of the lease agreement
  • Criminal activity – if a tenant participates in illegal activity in the rental property

These are as far as what the eviction process takes in North Carolina. A landlord has the right to evict a tenant for any of these reasons, but not for any other reason. This is important, as the North Carolina eviction process is carefully regulated.

Eviction and holdover

When a tenant stays past the end of the term of the lease or rental agreement, and if the lease agreement is not renewed, then they must leave the property under North Carolina law.

The amount of time that a renter has to leave the property at the end of the lease is dependent upon how long their lease agreement is. For week to week leases, the tenant has just two days to vacate the property. For month-to-month leases, the tenant has seven days to get their personal property off of the premises. For yearly lease agreements, the tenant has thirty days to vacate the premises.

If a tenant stays on the property after the end of the grace period that’s associated with their lease length, then they are subject to the eviction process, or summary ejectment.

Eviction and past due rent

Past due rent is the thing that we most commonly think of when we think of eviction.

In North Carolina, the rent is considered late if it is past due by one day. For example, if the rent is due on the 10th of the month, then the landlord must give a notice of eviction the next day on the 11th. This notice can either be verbal or written, either one.

A landlord does have the right to evict a tenant for not paying their rent on time in North Carolina.

The landlord can assess a late fee for lack of payment of rent, but only after five days past the due date. They can then charge up to five percent of the rent payment for being late, or fifteen dollars, whichever is higher.

If the tenant pays the rent that’s due, all of the rent and the associated late fee, then the eviction process is automatically stopped and the summary ejection is called off.

Eviction and lease agreement breaches

Breaking the lease or rental agreement is a big deal in the North Carolina eviction process. Within the lease is a list of things that the tenant must do in order to stay in the property.

These might include things like keeping renters insurance, not smoking in the home, lawn maintenance, utility payments, occupancy requirements, or pet requirements. When a tenant violates the stipulations of the rental agreement, they can be subject to eviction at the landlord’s discretion.

The landlord is not required to give a notice period in North Carolina to file eviction papers on a tenant who violates their lease agreement. Either the landlord can give the tenant some time to gather their personal property and leave the home immediately, or they can give a little extra time while the tenant remains and clears up their things. This is totally up to the landlord.

Eviction and criminal activity

Criminal activity is a major driver of many eviction cases. This could be something like drug trafficking or some other criminal activity as well. Criminal activity that’s investigated either by the sheriff’s office or the local police department is an automatic way for landlords to evict tenants.

An eviction notice is only guaranteed if the tenant was directly involved with the illegal activity. If they did nothing to stop it when it happened, it’s likely that they’ll also have to deal with the eviction process, but it’s not guaranteed.

If a tenant attempts to stop the illegal activity and can prove it to the magistrate, then they have grounds to stay on the premises. The magistrate’s judgment on this issue is how the tenant will find out if they’ll be given a notice period of when to vacate, or if they’ll be allowed to stay.

Fees and filing services

There is a filing fee that the landlord has to pay to file eviction papers in North Carolina.

The basic fee is $126 just to file the paperwork. Though this includes a document service fee of $30, that doesn’t actually cover the fee for the sheriff’s office to serve the individual. There’s another $15 fee for the sheriff to serve the summons and complaint to the tenant.

In 2018, a state law in North Carolina went into effect that allows landlords to sue tenants for attorney’s fees and other court costs. These fees cannot exceed 15% of the amount owed to the landlord, so this doesn’t mean that a tenant has to pay potentially unlimited fees. It’s all up to the magistrate’s judgment as to whether fees are assessed to the tenant.

Burden of proof

In North Carolina eviction hearings, the burden of proof is on the plaintiff, or the landlord who filed the summons and complaint to begin with. They must show that the tenant either failed to pay rent, violated the terms of the lease, committed criminal activity on the property, or that they are holding over past the expiration of the lease.

It’s up to the magistrate’s judgment to decide who is right and who is wrong in a civil case like this.

Glossary of North Carolina eviction terminology to know

Understanding the language in the eviction process is incredibly important if you’re facing eviction in North Carolina. 

It’s important to note that most of the words here are just legal terms for common words. Legal terminology surrounding North Carolina eviction can be intimidating, but it doesn’t have to be. 

Here are thirteen eviction terms that you should be aware of.

  1. Answer and counterclaim

When a landlord files an eviction, the tenant has the right to file something in return stating their position. The answer is the document that the tenant files to respond to the eviction notice. It can include a counterclaim, which details what the tenant believes they are owed in the process.

  1. Appeal

An appeal is when the tenant asks for a new hearing after the current hearing is completed. In North Carolina eviction law, a tenant has ten days from the date of the magistrate’s judgment on eviction to file an appeal. 

  1. Breach of contract

When one party or the other doesn’t follow through with what’s been agreed upon in the lease, it constitutes a breach of contract. This is one possible grounds for eviction, but it’s not the only one. The landlord can breach the contract as well. 

  1. Continuance

A continuance postpones the court date, but only temporarily. A continuance might be granted if one of the parties can’t be there on the day of the hearing, or if there’s further evidence to be gathered before the hearing. As evictions are time sensitive, getting a continuance on a North Carolina eviction case is not guaranteed. A continuance only means that there’s a new court date for everyone to participate in.

  1. Fair rental value

The fair rental value is the amount of money that is reasonable for a tenant to pay a landlord given the condition of the home, the neighborhood it’s in, the size of the home, and other various features of the property. A tenant can ask the court to reduce the amount of money they owe if the landlord is charging more than fair rental value for the home in North Carolina.

Fair rental value will differ from county to county and it will also change over time. Where a studio apartment in Charlotte that’s in great shape might go for $1500 a month, that same space might go for $500 a month in downtown Goldsboro.

  1. Good cause

There has to be a compelling reason for eviction in North Carolina. This is called “good cause”, and it’s what the whole process hinges on in eviction court.

As stated above, there are four reasons that someone can be evicted according to the “good cause” rule in NC law. These reasons are: holding over on an expired lease, criminal activity, nonpayment of rent, and violation of the lease. There are no other options- these are it.

  1. Lease

The lease is the written agreement between the tenant and the landlord regarding the tenant’s use of the property. A lease is generally able to be renewed yearly, though there can be different lengths depending on what both parties agree to. Leases can be written or oral in North Carolina. An oral lease is sometimes known as a “handshake” lease.

The lease is binding to both parties. In it, the responsibilities of the tenant and the landlord are both clearly spelled out. Any violation of this agreement, by either the landlord or the tenant, constitutes a breach of the contract.

A rental agreement or lease agreement is there to protect both parties from getting taken advantage of in any way. It’s critical that tenants understand that the lease protects them as well as protecting the landlord.

  1. Magistrate

A judge in a North Carolina small claims court is called a magistrate. Small claims court is a civil court, meaning no one is penalized with jail time for whatever they are found guilty of. Small claims court is capped at $10,000 in North Carolina.

If the case is for more than that, then it moves to district court, where there are steeper fees and much more money involved. The vast majority of eviction hearings in North Carolina take place in small claims court.

  1. Notice

There are many different kinds of notices in the tenant/landlord relationship. There is the notice of eviction, which is the legal document served to a tenant stating that they have a certain amount of time to vacate the property. There is also the notice of repair, which occurs when the tenant lets a landlord know that something in the home needs to be fixed. In North Carolina, a notice of repair doesn’t have to be given in writing, though it’s always a good idea to do so as this provides evidence of the request. 

  1. Plaintiff & Defendant

A plaintiff is the person who starts a court case. In the case of eviction in North Carolina, the plaintiff would be the landlord, as they are the person who initiates an eviction proceeding. 

The defendant is the person who is brought to court. For North Carolina evictions, this would be the tenant. A defendant has the right to bring a counterclaim under North Carolina law, so the defendant can be awarded damages even though they didn’t initially bring the claim forward. 

  1. Rent abatement

If the North Carolina house is not well maintained and is therefore worth a lower amount of rent than the tenant was charged, a magistrate can order a rent abatement. A rent abatement is a reduction in the amount of rent because the landlord did not do adequate repairs to the property. In North Carolina, a judge can order that rent be abated for past rent, for future rent or for both past and future rent.

Rent abatement only happens when a tenant makes a strong case with lots of documentation to back it up. It’s important for tenants to rely on first hand accounts, rather than “hearsay”, which is when someone in court asserts that someone else told them something. Anything you offer to the judge must be something that you witness firsthand.  

  1. Retaliatory eviction

Under North Carolina eviction law, it is illegal for a landlord to evict a tenant because they exercised their legal rights within the calendar year. For example, if a tenant made repeated requests for repairs that went unaddressed and so called a housing inspector or a tenants’ rights organization to advocate for them, it’s not legal for the landlord to evict them.

Retaliatory eviction is a real problem that comes up when a landlord wants to sell a home without tenants in it or when a landlord wants to keep from handling property repairs. There are lots of resources available throughout North Carolina to help tenants who are facing retaliatory eviction. 

  1. Summary ejectment

This is the legalese for eviction in North Carolina. In NC, a landlord files something called a “Complaint in Summary Ejectment” to remove the tenant from the home. In North Carolina, eviction is the common term for summary ejectment.

What happens if you’re evicted in NC

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Tenants in North Carolina who are evicted may end up not only paying rent, but paying court costs as well. Personal property will have to be removed from the home by a date that the magistrate gives during the eviction hearing.

In some cases, the sheriff’s office will send an officer to escort the tenant back to the home to get their personal property. North Carolina landlords are entitled to take possession of the property after eviction hearings when a writ of possession is issued. The writ of possession will give an exact date when the tenant has to be out of the home.

If you have gone through the district court process, and completed the appeal process, then you must leave the rental property if the judgment was found against you in district court. It’s an unfortunate but inevitable outcome.

The best way to deal with eviction

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The best way to face the eviction process in North Carolina is to be honest and straightforward throughout the eviction process.

Landlords have a right to rent payments on property they own. Though a district court magistrate might be empathetic to your situation, they will still hold you to the fact that you must pay rent.

If you feel you’ve been the subject of an unethical eviction process, contact legal aid to explore the possibility of legal representation. The summons and complaints you get in the mail might seem intense, but you’ll get through it.

The most important thing to remember is that the eviction process only takes a few weeks. Whatever the outcome is, you can always look to the next steps and to rebuild your life. Resilience is the watchword when facing eviction in North Carolina.

How to sell your Tampa house during probate

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Probate is not easy. If you’re one of the unlucky people who has to go through the probate process following the death of a loved one, you know that it’s intimidating and challenging. If you think you want to sell a house in probate, you’ll need some information about how to make it happen. 

Can you sell during probate?

The short answer is that, yes, you can sell during probate in Tampa. In fact, it’s sometimes required that a home is sold in probate in order to resolve the estate.

Estate debts have to be settled under state law. An estate attorney will have to navigate probate laws, in conjunction with an estate executor, in order to get the home sold. The home cannot be sold in probate unless the court approves.

Selling a house during probate is actually more common than people think. This is why probate sales are a great place for an experienced cash buyer to find an investment. The probate process is public, so investors know that it’s happening.

The basics of Florida probate

A home is real property and has value in the eyes of Florida law, value that must be adequately passed to the right person. 

If the deceased doesn’t have a will or there is no clear next of kin, then the property goes to the courts to decide who gets the property. An executor is appointed by the court to make decisions about the property. 

Appraising the property

The first step in selling a house in Tampa is to get the home appraised. Knowing the value of the home is the key to being able to convince the court to allow a probate sale to go through. 

You can find an appraiser through referrals from friends or family members. You can also look online for a well reviewed home appraiser. A good appraiser will be able to tell you exactly what the home is worth and what potential problems will arise with buyers. 

A solid appraisal will help the home sell fast, which is especially important when you sell a house in probate.

Tampa probate court

Probate court gavel in Tampa

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Tampa probate court is in the Hillsborough County Courthouse in the city. This is where heirs go to petition the court for a decision about the sale of a house in probate. 

Probate court is a civil court proceeding. The legal process to resolve a deceased person’s estate happens when the probate court splits the real estate and other probate property among the heirs. Probate courts make tough decisions about which family members and friends have a claim on the estate assets.

An experienced probate attorney will be able to help navigate probate law, splitting up the proceeds from the sale of real estate.

What to know about the probate process

Real estate sales in Florida during probate have to be arranged by an estate executor. Whenever there is a court hearing for the probate process, the estate executor will ensure that the proper filing of bids is done.

If there was a joint owner with the home, the house will not go into probate at all. The court will typically appoint a relative or friend as the estate executor if there isn’t a joint owner or a legal will saying where the property should go.

Marketing a house in probate

Getting the word out to buyers agents that the home is for sale is an important part of the probate process. This involves listing the house online and reaching out to real estate agents in Tampa. The more eyes you can get on the house, the faster you’ll be able to find a buyer while the house is in probate. 

The other option is to find a cash buyer to sell a house in probate to. A real estate investor will know about the probate process and will be able to help you get the home sold quickly.

If there are major repairs that need to be done to the house, then the property may need to be sold as is. The estate might not have the funds to make repairs, and a traditional sale is often out of the question. Still, many people decide to go with an experienced real estate agent to sell a home during probate.

Keep in mind that a real estate agent sale will decrease the amount of profit that will come from the sale. Always be sure to work with a real estate agent who is a member of the National Association of Realtors. Also, seek out an agent who has experience with probate sales, rather than just with the traditional home sale.

Understanding the probate sale

During the probate sale process in Tampa, there are some requirements of the buyer that are unique to this situation. 

Under Florida law, a buyer’s offer has to come with ten percent of the purchase price as part of a down payment. The deposit can be more than that, with an all cash offer, but it must be at least this month. 

If the representative of the estate, working with the probate attorney, agrees to the sale at the bidded price, then it goes in front of the probate judge. The judge will decide whether to validate the sale. 

With the judge’s blessing, a date is set for the sale to be finalized. This is only possible if all the parties agree to the sale. 

Probate costs

There are probate costs to contend with as part of the probate court proceedings. These include the costs of a personal representative, a probate attorney, court costs, and closing costs that are associated with the sale of a house in probate.

Probate property doesn’t just include the proceeds from the real estate sale, but also the bank holdings that were in the name of the deceased person and any life insurance policy funds that are part of the estate’s assets.

Presenting to the heirs

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If the property has an accepted offer, then the court mails a Notice of Planned Actions to the heirs. This legal document explains all of the ins and outs of the deal. 

Each of the heirs has fifteen days to object to the sale if they don’t want it to go through. If no one speaks up to object, then the deal goes ahead without another hearing. 

Overbidding in a probate sale

Before the final sale is approved by the court in Tampa, the home sale is opened to bidders. 

For a bid to be submitted, it must be five percent plus five hundred dollars above the previous offer. The overbidding process is all about getting the most amount of money into the hands of the estate.

The judge continues to accept bids until bidding is complete and no further bids are submitted. To sell a home in probate, this auction step must be taken. Potential buyers have the chance to buy inherited property for any reason.  

When selling a home in probate is necessary

To settle the affairs of the estate of someone who passes, it’s sometimes necessary to sell a house in probate. Oftentimes, a sale during probate is the only way for the heirs to get their piece of the estate. 

Outstanding debts are another reason that an estate sale might be necessary. It’s a complicated process, but if the remaining assets don’t cover the bills left behind, then the proceeds have to go to settle the estate.

In many cases, the family members don’t want to keep the home. It may be necessary for the proceeds divided among the heirs to come from the property left behind.

What happens to the money from a probate sale?

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The first thing that happens to the money after a home is sold in probate is that it goes into a trust for three months. The buyer takes possession of the property during this time, but the funds are not available to the heirs until the end of ninety days. This time allows for any other unexpected claims on the money.  

When a home in probate is sold, the money goes to the estate, not to the individual heirs first. The proceeds from a probate sale are first used to pay down the debts associated with the estate. 

After the debts are settled, then the remainder of the funds are split between the heirs according to the will of the judge. 

Why probate sales are not uncommon

Probate sales are not uncommon in Tampa because all too often, people pass away without a clear will to take care of their debts and assign their possessions to. 

This is why it’s so important for everyone to write a will and ensure that every family member who has a right to the estate is included and that there’s enough to cover the debts from the estate. Unfortunately, it’s often that property is not clearly divided up in a will or that a will exists at all.

When a person dies, it’s hard on everyone. The probate process is meant to help ease the strife that can come without a valid will.