Miami Beach Condo Sales Volume Slows, Prices Increase

According to data from the Palm Beach MLS, condo sales in Miami Beach have seen a drop off in volume year-over-year. Comparing January to September data from 2013 and 2014 shows that while active listings are about the same, the number of units being sold and the sales volume have dropped off. In 2013, 2091 condos had sold in Miami Beach by September. That number is down to 1,681 this year, a 19% decrease. The overall sales volume also dropped year-over-year. In 2013 sales volume stood at $1.161 billion, this year it is at $1.022 billion an 11% decrease.

The drop off in sales has not deterred sales prices though which have risen year-over-year. The average sale price for a Miami Beach condo was $555,412 at this point in 2013. This year the average sales price has climbed to $608,214 which is a 9% increase. Higher average sales prices with lower volume can be concerning to some, and indeed, average sales prices appear “bubble like” to some market analysts. However, these numbers also may be a result of a market attempting to recover and restabilize. The short sale wave that hit Miami Beach sent average sale prices down and volume numbers up. Perhaps we are now seeing short sales decrease and property valuations and sales return to more normalized values. As winter (a busy time for South Florida real estate) approaches, we will be sure to keep an eye on the real estate market and see where the numbers are headed.

Short Sale Tips: Part 5

(This is the fifth post in a series of blogs discussing the short sale process and tips for navigating it. The previous posts can all be found here)

We’ve finally come to the decision stage of our series on short sales. At this point in our journey we have looked at everything from preparation of your team before you enter into default, all the way up to submitting your short sale package and how to prepare for possible actions by the negotiator before approval or rejection. Now we will look at what to do in in the case of rejection of your short sale, and in the final post look at the acceptance of your short sale.

First, what happens if you have gone through all the work to get to this point and your lender still rejects your short sale? This is always a possibility and with the way the market is trending right now it has become more and more likely. If this happens to you the first thing you must focus on is remaining calm. Hearing that your lender has rejected your short sale can cause a wave of emotions to rise up including anger, frustration, and dread of a possible foreclosure. However, it is important to stay composed and continue to work with the lender.

Once you have composed yourself, you are going to need to find out why the negotiator has rejected your short sale. You and/or your agent need to speak with the negotiator and have them explain why they rejected your short sale offer. There are a wide variety of reasons that a negotiator may reject a short sale:

  • Most lenders require you to be in default on your mortgage to qualify for a short sale. If you have tried to get short sale approval without going into default then your lender may reject your application.
  • The negotiator, after looking at your income and asset information, may decide that you have too many assets and too few liabilities to qualify for a short sale. Lenders are only going to approve short sales for those borrowers who demonstrate clear financial hardship. If they see large liquid cash reserves or a lack of other liabilities the negotiator may decide that you have the money to pay your mortgage but are simply refusing to.
  • The lender may feel that the buyer’s offer is too low to accept.
  • The lender may see a better financial opportunity to foreclose on the property and try to recover value at an auction

Whatever the reason it is not time to give up. First, it may be possible to let the current negotiator close your current file and then re-open the file with another negotiator. Different negotiators may have different opinions on the case and a change could gain you an approval. It may also be that the negotiator doesn’t have the authority to grant approval because of the lender’s internal policies and asking to be referred to a supervisor could help.

If neither of those solutions works then your answer may depend upon the reason for your rejection. If you have yet to enter into default, as is sometimes the case, then it may be that the lender requires a borrower to be in default before a short sale can be approved. Ask your negotiator if this is the case and if so, then not paying your mortgage may get you short sale approval. (Of course before considering such a step you should always consult with experts who can tell you the consequences of such actions) If your application was rejected because the negotiator doesn’t believe that you are suffering a financial hardship then try to find out exactly what aspect of your situation led them to that conclusion. Sometimes a new letter of hardship or a letter from your short sale agent explaining your predicament can sway the decision. If you do have some liquid assets then offering to make a seller’s contribution can also potentially change the decision. If the lender sees that you are willing to contribute and mitigate their loss to a certain degree they may approve the short sale. If your buyer’s offer was too low or the lender believes that they can get a better deal through a foreclosure auction then work with your buyer to try and get a better price, while also trying to convince the bank that they cannot find better value elsewhere. Getting another Broker’s Price Opinion, appraisal opinion, comparable property list and general market assessment may show the lender that there isn’t extra value where they think there is. A savvy agent should be able to help you through this process. The point is that if you have been rejected then you should keep working for approval until every avenue has been exhausted. Usually you will be able to find one option that will reverse a decision from the lender and gain an approval. Next time we will discuss what to do once that approval has been gained.

Short Sale Tips Part 4

So far, we have walked through the short sale process up to the point of sending the short sale package to your lender. (You can read our previous posts here, here and here.) What’s next for you?

If you have sent your short sale package off to the lender then it is now in the hands of the lender’s negotiator. This party is going to review the entirety of the package and determine whether or not you are qualified for a short sale according to the lender’s own policies. Obviously, in dealing with the negotiator you want to always be respectful as you don’t want to upset the person who holds the decision on whether or not to approve your short sale in their hands.

You should be prepared for the possibility of the negotiator countering the buyer’s offer with a higher number. As we have said before, the lender is trying to maximize the value they can recover from the sale, and so if they think they can get more money out of the property they will do everything they can to get it. Sometimes the negotiator will also counter asking that the seller (you) contribute to the sale. This can result from the negotiator reviewing your income and assets and believing that you have liquid assets that can be used to recover what you owe on the mortgage. In either situation you will need a skilled agent (Such as the ones at The Agency Luxury Realty) to communicate and negotiate with the various parties. Including a listing of comparable properties and their values, an appraiser’s report on your property and/or a log of listing price reductions in response to lack of demand over time can occasionally reduce the odds of the negotiator making a counter offer. These documents can show the negotiator that you have been trying to get more value for the home but the demand just isn’t there, and so if they want to recover value and avoid an expensive foreclosure, the buyer’s offer is the best option.

Perhaps the best advice in dealing with the negotiator is to simply be patient. You want to allow a reasonable amount of time to pass for the lender to contact your agent. The negotiators are working on multiple files at the same time so inundating them with calls and messages isn’t going to help your case. Wanting to call and talk to the negotiator is understandable when you are waiting for a response and have heard nothing, but resisting the temptation and being patient will pay off and avoids the possibility of the negotiator feeling like you are harassing him with calls. You have to simply let them do their job. In the meantime prepare yourself for either possibility of acceptance or rejection of the short sale. Each possibility carries different contingencies which will be covered next time.

 

Short Sale Tips: Part 3

834 OceanIn the third post of this series we are going to start looking at what happens once you have had a buyer make an offer on your short sale property. You can read the first two entries in the series here and here.

 

Once you have received and offer on your property your attorney should provide you with a list of documents that are going to be needed from you to be sent to the lender. These documents compose the short seller package and are necessary to obtain short sale approval from the lender. The exact documents that the lender needs can vary but in general you should expect to have to provide

 

  • An executed listing agreement for the short sale property

 

The lenders will want to see when the property was listed, what brokerage listed it and what the commission is. In general if an offer is well below market value and the listing has only been active for a short period of time the lender is not going to accept the offer.

 

  • A fully executed purchase contract

 

Your attorney should look over this to make sure every detail, signature and initialing of every required party is completed. An incomplete contract can hold up a deal.

 

  • A seller’s hardship letter

 

This letter should describe how you came to be in the current position, what options you looked to in order to get out, and why a short sale is the only remaining option. The lenders are going to look at this letter to determine if you really have been pursuing the best options to secure the money that you owe them. You should have your attorney work with you on this document.

 

  • An authorization letter

 

This letter must be signed by you and authorizes the lender to speak with your listing agent. Without this the negotiator cannot contact the listing agent and make a deal.

 

  • Your last two bank statements, W2’s, tax returns, and pay stubs

 

The lenders want to make sure that you are in a financial hardship and cannot pay your mortgage before agreeing to a short sale. If you have large amounts of cash in savings, or earn enough that the lender thinks that you can afford your mortgage then they may reject the short sale. This is becoming more true today as short sales decrease and the market has started to improve.

 

  • Estimated HUD-1.

 

The HUD-1 is essentially an itemized list of closing costs, services and fees. It is a complicated document and is prepared by the settlement agent.

 

You will want to put together and submit the short sale package as quickly as possible to avoid any delays. Once the package has been submitted it usually takes 30-90 days to gain approval, but it can take even longer in certain cases. Ultimately, each lender’s disposition and the workload of your negotiator at the time will affect how long you will have to wait for a decision. Since the timing at that point is out of your hands just focus on controlling what you can and delivering required documents accurately and rapidly. Typically the faster you get your documents out the faster you will hear back from the lender, but of course there are exceptions to every rule.

Compiling and sending out the short sale package can be a complicated and stressful endeavor, but with an experienced team on your side like the team at Weisberg & Associates, Oasis Title and The Agency Luxury Realty, the whole process will be much simpler. If you are planning on listing your home as a short sale then you should contact us to learn how we can help you through the process.

Short Sale Tips: Part 2

In our next post within our series on short sales we’re going to give you a few more tips on what to do if you are facing a short sale as a seller. Last week we explained the importance of working with a company that has vast experience in dealing with short sales, and making sure to hire an attorney who has worked on short sales and can help you navigate the process. This time we will discuss two marketing tips for listing your home and finding a buyer.

To start, if you are still living in the home then make sure you are keeping it up the best possible appearance standards to entice buyers. Most of the homes that go through the short sale process look like “fixer uppers” and if a potential buyer believes that there are going to be a lot of costly repairs associated with buying the home they may not be willing to give an offer. Just by keeping your house looking nice you can give yourself an edge in comparison to other distressed properties and perhaps find a buyer sooner.

Second, make sure that your realtor does their research and provides you with a list of properties that are similar to yours. When you set your listing price you have to understand that the lender has the say in what price they will take in a short sale. Often times if you go too far below market value the lender will reject any offers made at that price and may move ahead on the foreclosure process to recover their assets. A realtor with short sale experience who does adequate market research should be able to help you set a reasonable listing price that is likely to be accepted by the lender. You could also seek the services of a property appraiser to give you an idea of what your home is worth, if you do make sure to get his appraisal to the lender in the short sale package later on. Whatever method you use remember that the lenders are trying to recover as much money as they can and have the final say on whether or not to accept an offer.

Just by following these two simple guidelines you could help yourself out massively in terms of finding a buyer for your property sooner, and getting your lender to accept the short sale offer. In addition, if you have an experienced short sale real estate agent, such as the ones at The Agency Luxury Realty, on your side you will have an advantage over anyone who doesn’t. Next week we will look at what happens once you have received an offer on your short sale property.

 

Short Sale Tips

Today we are starting a new series on the blog designed to give you tips on dealing with short sales. If you are facing or are currently in default of your mortgage then a short sale can be a way to avoid foreclosure and all of its negative impacts. On the other side, a short sale can offer value for a buyer if he or she finds a property where the bank is willing to accept below market value for a home. No matter what side of the short sale you are on though, there are some general principles that you should always follow.

 

First, whether you’re purchasing or selling a short sale, it is in your best interest to consult with a company that has years of experience with short sales. The short sale process is a complex one and you want to go into that process with a team that is not going to be surprised by anything that arises. Because of our vast experience in dealing with short sales we at The Agency Luxury Realty & Weisberg and Associates have the knowledge and ability to get the deal done. We have negotiated and closed short sales with just about every lender you can name and we know which buttons to push with each lender. We would be happy to walk you through the short sale process whether you are buying or selling.

 

Second, you should consult with an experienced attorney that has worked on short sales recently. Short sale policies have changed and are continuing to do so meaning that you need to make sure you get all of the latest and most accurate information before deciding on who will handle your short sale. You need an attorney who keeps abreast on all of the latest short sale regulations so that you can be sure everything will go according to plan. It is also helpful to hire an attorney who is familiar with the area you are located in and has worked extensively with the involved lenders beforehand. This knowledge and experience will give you some leverage in negotiating a deal with your lender.

 

Finally, ask your realtor and/or attorney as many questions as you can think of regarding your situation and short sale inquiry. There is never a dumb question when it comes to short sales and the better educated you are the better deal you will be able to get. If you have brought the right people onto your team then you shouldn’t be intimidated or confused by the process. Instead, ask questions and don’t be ashamed to admit that you don’t know something.

 

Our office has seen just about every scenario when it comes to short sale negotiations. We have received short sale approvals in less than 20 days while some have taken over 20 months. It all depends on each lender’s disposition and how efficiently documents are submitted to and received by the lenders. This wealth of experience acts as an assurance for you that we will get the job done right. In addition, since the team at Weisberg & Associates, Oasis Title Company, and The Agency Luxury Realty all work together, the entirety of your short sale, title and closing needs can be handled in one place by one team. No matter if you are buying or selling, if you are considering doing a deal involving a short sale you should contact us today to get the assistance you need.

 

That’s all for this week, be sure to check back next week as we continue to provide you with short sale tips meant to make your life easier.

 

Mortgage Closing Costs on the Decline

Closing costs have dropped by 7 percent over the last year, according to an annual survey on closing costs conducted by Bankrate.com. Closing costs average $3,754 nationwide.

Title insurance and other third-party fees also saw a drop in the last year, falling 12 percent, and origination fees fell 1 percent, according to Bankrate.com’s survey.

“This is the second year in which lenders are required to estimate third-party fees within 10 percent of the final cost. It seems like they’re getting more accurate, which helps explain the sharp decrease in these fees over the past year,” Greg McBride, Bankrate.com’s senior financial analyst, said in a statement. “The main lesson of this survey for consumers is to shop around for at least three different estimates. While no one is going to move to a new state just because closing costs are lower, it’s important for people to realize that there is variation even within their neighborhood, and that they can save by being an educated consumer.”

5 States With Highest Average Closing Costs

  1. New York: $5,435
  2. Texas: $4,619
  3. Pennsylvania: $4,467
  4. Florida: $4,395
  5. Oklahoma: $4,352

5 States With the Lowest Average Closing Costs

  1. Missouri: $3,006
  2. Kansas: $3,193
  3. Colorado: $3,199
  4. Iowa: $3,257
  5. Arkansas: $3,325

View the survey, which contains all states’ average closing costs.

Source: Bankrate.com

The HOA Crisis

This is how it works. Or, rather, doesn’t work.

A mortgage servicer completes the foreclosure, eventually. And the bank has taken title to the home and arranged to sell it as an REO to a new buyer. The purchase contracts are even signed. So, take another home out of the however-many-millions there are in the shadow inventory. It’s off to the next one.

But then the bank finds out there is a homeowners association or condo association past due amount. In each state it is different, but in Florida, it’s a nightmare. A safe harbor rule under a legal statute declares the first-lien holder can pay the lesser of either the past 12 months in assessments or 1% of the original principal balance on the home.

So, if a homeowner is paying $250 per month in HOA fees for a home that originally cost $140,000, that would be roughly $1,400 owed to the association as 1% of the original principal balance, opposed to the $3,000 in past due fees.

You can imagine the shock on Charles Gufford’s face when his client, the servicer, comes to him at the 11th hour of the process and says the association is asking for $25,000. Gufford works as the resident expert on assessment and associations disputes for the Florida law firm McCalla Raymer.

There’s actually no shock on Gufford’s face. This happens all the time. Often, after months of negotiation, he can get the price tag down to around $5,000 on a $25,000 assessment bill. Many servicers don’t even use the safe harbor option of choosing the sometimes least costly 1% option, which often have the same late fees, overcharges and attorneys fees with it.

The managing partner of the firm, Jane Bond says that’s nothing. She’s seen cases in which the HOA of a beach-front property billed the servicer $90,000 in assessments before the foreclosure or REO deal could be completed.

“I don’t want to say it’s a vague statute, but in some aspects it needs a little clarification so that we all know what we have to pay,” Gufford says.

The problem is that the statue doesn’t fully define what the term “assessments” means. The HOAs and condo associations have been bleeding money since the foreclosure crisis. So, most of them are taking everything they can.

Gufford even feels sorry for them. A little.

“Think of how long it takes to foreclose today (nearly 1,000 days on average in Florida) and all the dues they’re missing during that time and that other owners are having to bear that cost,” he says. “When title is taken by the lender, they shoot for the moon and not for what they’re entitled to.”

According to the Community Associations Institute, which provides resources to condo and homeowner associations, assessment delinquency rates tripled since 2005. According to a survey in December, more than 63% of these associations reported delinquency rates above 5%, compared to 22% reporting rates that high six years prior.

More startling, one in 10, or roughly 30,000 associations, have an assessment delinquency rate above 20%.

“High delinquency rates place tremendous pressure on associations to meet their obligations to the homeowners who are paying their fair share,” says CAI Chief Thomas Skiba. “When some owners —including lenders that have foreclosed on homes and now own them — don’t pay their share, other homeowners often must make up the difference in higher regular assessments or special assessments. Associations must still pay their bills.”

And so they’re going after the banks for everything they can.

WHEN THE TROUBLE STARTED

The trouble really began in 2009. The liquidity crisis was beginning to ripple out, and the depth of the foreclosure crisis began to appear.

“REO started selling at a very considerable amount and flow,” says Brent Stokes, senior vice president of Sperlonga Data and Analytics, which is creating a large database of homeowners, condo, and community associations information.

Some servicers hired Stokes, who is an attorney, and others at Sperlonga to be middlemen of sorts. He is sent in as a negotiator for all kinds of things, and like more traditional foreclosure attorneys, he’s usually sent in at the 11th hour.

“The HOAs started submitting whatever was owed to them, that plus some more. It took the government agencies and the investors by surprise. But their first approach was, ‘Well we knew we would take some losses,’ so they paid it,” Stokes said. “Then, by 2010 it wasn’t just on a few properties. The industry started to realize that for some strange reason we’re seeing a lot more of these HOA assessment claims.”

The reason for the assessments, the industry would discover, is that most of the foreclosures were on mortgages originated between 2005 and 2008. Stokes said most homes being built during that bubble came under an HOA or condo association. He looked at the numbers and estimates 60% of the national REO inventory has an HOA attached, based on the files he receives from clients. That number goes up in places like Nevada and Florida.

“One property,” he says in bewilderment, referring to one in Las Vegas, “had six HOAs attached to it. It was part of an enormous development. It had two primary HOAs and four secondary ones.”

PROBLEM CHILD

“It started to affect all stakeholders,” Stokes explains, “not just the investors but asset managers, the people selling the properties who weren’t able to close on time, the title and settlement providers weren’t able to close deals on time, and even the inspectors and appraisers were having a hard time getting into gated communities with HOA requirements because no one knew who that HOA was until the very last minute.”

Lenders are developing their own plans on how to deal with the negotiations. Some hire counsel like Gufford and attempt to negotiate. Others just pay what the associations ask, making it more difficult for those who seek to negotiate. The banks who try often wait too long however, usually until the REO stage, and the HOA or the condo association uses this hard deadline against the bank.

“The best way, if I were a lender dealing with this, is if I knew that I was dealing with an association that was going to be a problem child, upon the issuance of title I would immediately get it to counsel to handle the negotiation of the reduction of the dues owed,” Gufford says.

Case law is currently turning through the Florida system that could ease the situation, but judges vary on enforcing it. If the bank settles with the HOA, often the association still comes back and attempts to charge the new owner of the home for the difference on the backed-up dues.

Banking attorneys often try to get a “sum certain” amount owed after the negotiations with the HOA. These financial firms claim the state statute allows the bank to ask the court to intervene and force the association to give a “sum certain.” Over roughly 30 cases, Gufford says he’s saved more than $1 million in fees.

It just may take awhile. The underlying foreclosure can sometimes take four to six months, and that just starts the clock.
“If there is a negotiation, we always try to negotiate to limit my fees and the cost of the time. That can take two months,” Gufford says. “If it gets into protracted litigation, I can usually get that down to three to four months.” Some negotiations, though, can take as long as five to six months and can include lawsuits against the HOAs.

But there’s another tactic associations are taking, one a bit more of a problem for banks. An association in many states can file its own foreclosure for delinquent assessments. Roughly 16 states, including the District of Columbia have this so-called “superlien” statute, allowing HOA assessment fees to not be wiped out by a foreclosure filing.

The foreclosure does wipe out all junior liens, leaving only the mortgagee or first-lien holder. Buried on the sixth or seventh page of a filing is a “quiet title” action.

Once the association has a quiet title —meaning it now has an interest in the property — it will extinguish the superior first lien and resell the home.

The associations argue the lender has abandoned its interest. Often, they point to the elongated foreclosure timelines or the vacancy of the home.

The bank sometimes doesn’t notice until it’s too late. An employee at the bank sees the foreclosure from the HOA or condo association and recognizes the bank has the first lien and places it back in the stack. Meanwhile, the association is awarded the foreclosure over the bank.

“After the judgment is entered, we’ll get a call from our client asking if we can help,” Gufford says. “They’ve done nothing during the case. I personally think it’s going to go up. It depends on the jurisdiction. Some of the judges are up on the case law and they know they can’t go through with the quiet title. Other areas of the state, mostly in South Florida, I think the judges are overwhelmed and I think they look at it and they say fine and let it pass through.”

RIPPLE EFFECT

“Condominiums went crazy, especially in Florida,” Stokes says. “You’re not going build one condo in Florida without an association.”
In 2008, Fannie Mae, Freddie Mac and the Federal Housing Administration — basically the only entities financing new loans — released new guidance. Each explained that if 15% of the total units in a condo development were delinquent on their assessments, new loans would not be financed.

These firms indicated to CAI they would work with lenders who request waivers when a particular project exceeds the 15% threshold. But the line was clearly drawn in the sand.

“CAI expressed its concern that measuring delinquencies by units may be problematic in the case of foreclosures, because the association does not always know who the current possessor of the unit may be for collections,” according to a notice the group sent out to its association members.

With the bank trying to figure out who the association is, and the association trying to figure out who the bank is and both sides spending months determining a settlement over past due assessments, an interesting character is emerging: the all-cash condo buyer.

Cash buyers made up 65% of home sales in Miami, and 90% of foreign buyers used cash in the city. Stokes said they’re using their leverage as basically the only game in town to drive down the price in some cities.

Because of this origination problem, foreclosures actually become harder to avoid. Without a financed buyer on the other end, a troubled borrower can’t get out of the condo through a short sale. The entire market suffers under the problem between the associations and the banks.

“If this is such a problem on the REO on the origination side, how in the heck are they going to get those condos sold when more than 15% are delinquent either by themselves or the borrowers who haven’t been foreclosed on yet?” Stokes asks.
One of his clients had him run an analysis on just how many of their cases were tied up in developments with at least a 15% delinquency rate.

Stokes couldn’t disclose an exact number, but he describes it as “a boatload.”

The association crisis is another tangled knot in the collapsed lattice that was once a booming housing finance web. It grew too fast, got too complicated, and attracted too many players and overlapping interests. Sorting out the problems now means unraveling those interests, restructuring the entire system.

What both sides want is some clarity. Attorneys for the banks simply want to know what they need to pay. Many are willing to pay it. Some are just paying what the associations are asking for now in the name of expediency. But that only makes the problem worse for those too entangled not to negotiate.

And like other problems facing the housing market, it’s not going away any time soon.

“We don’t see it subsiding, especially in the default world, for at least another three years,” Stokes says. “I think of the pipeline of foreclosed properties, not just from the agencies but for the private-label securities guys too, is just too large. If the investor doesn’t jump on the HOA until after the foreclosure is finished, then this limited marketability impact from the delinquency rate is going to even further extend the recovery time. It’s going to make it that much more expensive.”

Source: Housingwire.com

 

Bill could help short sale sellers in 2013

Under U.S. law, a homeowner with an underwater mortgage who goes through a short sale has part of his or her debt forgiven by a bank. The amount forgiven is legally considered income, as if the lender gave the owner a monetary gift by saying, “You no longer have to pay this.”

As a gift, that money is income and taxable by the IRS when the homeowner fills out his yearly income taxes. However, a temporary law effective through Dec. 31, 2012, nixes that amount as homeowner income, making the debt forgiveness tax-free. A short sale in 2012, then, allows a homeowner to walk away free of debt.

As it stands now, that rule expires next year, and underwater homeowners who go through a short sale could be taxed on the amount forgiven.

However, a bipartisan bill introduced late last week by U.S. Senators Debbie Stabenow (D-MI) and Dean Heller (R-NV) – the Mortgage Relief Act – would extend that rule past Dec. 31 if approved by both the House and Senate and signed by President Obama. Senators Robert Menendez (D-NJ), Sherrod Brown (D-OH) and Jeff Merkley (D-OR) cosponsored the legislation.

“It is bad enough that so many families are faced with mortgages that now exceed the value of their home,” says Stabenow. “But to add insult to injury, without this bill, the IRS would once again require these families to pay hundreds or thousands of dollars in additional income tax when they sell or refinance their home. That’s just wrong.”

Stabenow championed the original Mortgage Relief Act of 2007 designed to fix the problem that now expires at the end of 2012. Stabenow and Heller’s new bill will extend this tax protection for underwater homeowners through 2015.

Approximately, 20 to 25 percent of American homeowners are currently underwater on their mortgages.

Multi-Million Dollar Foreclosures

Below are eight multi-million dollar foreclosed homes that are back on the market throughout the United States.

Laguna Beach, CA

Asking price: $18 million

Located in “the Gold Coast of Orange County,” this impressive home with views of Catalina Island and the Pacific Ocean fell into foreclosure in 2010, the same year it was built. At one time, it was in escrow for $28 million. Now, the home is available through a private investment group for $18 million. It has never been occupied.

The house has an oversized master suite and 3 additional bedrooms, 6 1/2 bathrooms and a garage that can accommodate 20 cars. The kitchen is outfitted with high-end stainless steel appliances, granite counter tops and a butler’s pantry. There’s also a screening room and an atrium foyer. Elsewhere on the 11-acre property, are an infinity edge pool, spa, gardens and a fire pit.

“A home of this size on a parcel of land over 11 acres in this area is unheard of,” noted the listing broker Richard Leavitt. “It could never be built again.”

 

Newport, RI

Asking price: $7.9 million

This sprawling estate is a throwback to the Gilded Age — just with all new appliances. Originally built in 1891, the estate was foreclosed on last year and then renovated by one of its lien holders. It was listed last summer for $7.9 million and remains on the market.

There are 7 bedrooms, 7 1/2 bathrooms, a ballroom, music room and a library. Located at the highest point in Newport, there are impressive views of the ocean and — on a clear day — Martha’s Vineyard, from the rooftop deck. The property also includes 7 acres of manicured lawn and an extra lot with an additional lot available.

 

Atlanta, GA

Asking price: $3.7 million

Because of its sheer size (22,000 square feet) and Mediterranean-style architecture, this estate is unlike any other home in the area, said listing broker Suzanne Close.

It initially hit the market nearly three years ago for $5.9 million. After the bank took possession of the property in 2011, it was re-listed for $3.7 million.

Built in 2006 on 3 1/2 acres, this home was made for people who love to cook — or, have someone cook for them. There are four kitchens inside (two on the main level, one in the guest suite and an additional one in the basement), as well as an outdoor kitchen near the pool area with gas and charcoal grills and a pizza oven.

Other pricey details include hand wrought iron work, travertine floors and limestone around the pool deck.

 

Orono, Minn.

Asking price: $6.25 million

This shingle-style mansion with 350 feet of frontage on Lake Minnetonka was originally listed in 2009 for $11.5 million, but the price was reduced to $9.9 million and then again to $8.9 million. Now the home is owned by the bank and listed for $6.25 million.

Designed by an architect from Sag Harbor in 1999, the house is very much in keeping with the high-end homes in the Hamptons, said the listing broker Ellen DeHaven. “It looks like a home you could airlift onto Long Island, but [Lake Minnetonka is] our version of the waterfront.”

The home includes 4 bedrooms, 6 bathrooms, a game room and a carriage house. Despite being bank-owned for 6 months, it has been exceptionally well maintained, DeHaven noted, with a refurbished roof and refinished floors.

 

La Jolla, CA

Asking price: $5.9 million

After languishing on the market for several years at an asking price of more than $7 million, this prime beach property fell into foreclosure last year. Now it’s listed by the bank for $5.9 million.

Listing broker David Finburgh admits that the place is just in “fair condition,” but there’s plenty of great potential for this 11,000-square-foot home with amazing views. One highlight: the 3,700-square-foot master suite, with his and her bathrooms. There are also 4 other bedrooms and optional additional bedrooms. Outside, there is a pool and spa.

The home, which was built in 1991, sits on 3/4 of an acre on top of one of the highest points in La Jolla, a neighborhood where foreclosures like this are a rarity, assured Finburgh.

 

Palm Desert, CA

Asking price: $3.5 million

The last time this home in the gated Bighorn Golf Club community sold in 2007, it went for $6 million, according to Signe Beck, of Luxury Homes by Keller Williams. But after being foreclosed on in March 2010, its price has come down significantly. It’s been on and off the market over the past two years and was recently re-listed last month for $3.5 million.

The Palm Springs home boasts 5 bedroom suites, including a master suite with its own fireplace, his and her bathrooms and French doors that open onto the pool. The chef’s kitchen has a pair of Viking refrigerators and a view of the putting green and the waterfall out back.

 

Monterey, CA

Asking price: $3.99 million

Located in Monterra Ranch, an exclusive gated community with a private golf course and club, this home was foreclosed on in 2009, then listed for sale by Monterey County Bank for $4.65 million. The bank later slashed the listing price to $3.99 million. Over the past few months, several lower offers have been declined, said listing agent Joy Jacobs.

The Mediterranean-style home has 4 bedrooms, 6 bathrooms, a gourmet chef’s kitchen, game room, wine cellar and library with high-end details like limestone floors and vaulted ceilings.

 

Cherry Hills Village, CO

Asking price: $4.6 million

Originally listed in 2008 for $8.9 million, the price on this home was dropped to $6.9 million in 2010, then to $5.9 million a year later. The house was finally offered through a public trustee sale and bought by the original lender in September of last year. The bank is currently listing the home for $4.6 million.

Built in 2007, this 11,135 square-foot stone home sits on 2 acres and has 5 bedrooms and 9 baths. There’s a large chef’s kitchen with a wood burning fireplace plus an artist’s studio.

But perhaps the biggest selling points are the impressive views of the mountains and the town. “You look at Pikes Peak out the front door and Longs Peak out the back door, and there are 125 miles between the two of them, it’s dramatic,” said listing broker Tim Colleran.

 

Source: By Jessica Dickler @CNNMoney