Yesterday, things changed for home owners who lost or are losing their properties to foreclosure. Massachusetts Attorney General’s office was part of a national settlement with Ally Financial, Bank of America, Citigroup, JPMorgan Chase, and Wells Fargo. (This agreement includes 49 states -- including all six New England states.)

Here are the main points:

It’s a big settlement. $25 billion.

It affects borrowers who were foreclosed on from 2008 – 2011.

It has provisions for financial relief in the form of reductions in loan principal, a lower interest rate, or cash payments. The rules about how these benefits will be distributed will vary from lender to lender. The lenders have three years to complete the settlement terms. They need a month or two to get their systems in place. (So, if you are involved, expect to not know how it will affect you for a while.)

Who qualifies, generally?
Loan modification will apply to borrowers who are behind in their payments and at risk for foreclosure.

A cash payment of an estimated $1500-$2000 will be given to owners who were foreclosed on between 2008-2011. (The amount will depend on how many people file claims.)

Borrower’s rights:
Those who are in the process of modification cannot be foreclosed on mid-stream.
Foreclosed homeowners have not waived their right to sue lenders on their own.

While sellers across the country are piling on the concessions, not here in the Bay State.

Just 21 percent of sellers offered a sweetener to move their homes, compared to 41 percent nationally, the Massachusetts Association of Realtors reports in its annual survey of buyers and sellers.

Sellers who threw in a few goodies typically chose to fork over money for closing costs and home warranty polices, or offered a credit towards home repairs and remodeling, according to MAR.

Those of you that are already out there looking for property, do you think spring is in the air? My experience last weekend was that there continues to be a lack of decent property and fair prices out there.

I start to anticipate spring at Groundhog’s Day. But for those who don’t love marmots, the midpoint of winter is Super Bowl Sunday. Last weekend had more the usual number of early open houses on Sunday and more Saturday open houses. That way, the faithful fans could get to their drinking and praying by 2 PM. Wait until next week...

Since I am based in Cambridge, I wonder what people who don’t care about either Groundhogs or Patriots use to mark the turning point of winter toward spring. Valentine’s Day? How do you judge the point when the winter market starts turn towards spring?

There is typically an uptick in listings right after Super Bowl, even when the Patriots are not playing. Last year, there were 222 new listings in my area the week after the game. Remember that last winter, there was a good bit of snow and ice on the ground at this time of the year.

As I write this (before the game), I am wondering how many listings I will see come in next week. Do you want to venture a guess?

Even during tough times, buyers still go gaga over the surface things - fresh paint, hardwood floors, hip appliances.

And the allure of the fresh and new is particularly strong here in Greater Boston, where so many homes are older and in need of fixing up.

However, given how inflated home prices are within I-495, losing your head over a home that has been all dressed up to sell is a luxury most of us can't afford.

If you are fine paying an extra $20,000 for what amounts to a nice paint job, then go ahead, it's your life and your money.

But if you want to break into the Greater Boston market without saddling yourself with backbreaking mortgage payments, you have force yourself to see beyond hideous wallpaper, scuffed floors, dingy bathrooms and battered doors.

Today, a lawyer's look at short sales with our Attorney Richard D. Vetstein.

Sam blogged about short sales last week. I will go one step forward and predict an increase in short sales for 2012, with distressed homeowners and lenders opting for the more cost effective method of disposing distressed realty. With some early success, I’ve been advocating for a better way to legally document short sale deals. It’s better for real estate agents, attorneys, sellers and lenders alike.

The Offer to Purchase: Now the operative contract document

I am seeing a shift to making the offer the operative contract in a Massachusetts short sale transaction. And for good reason. A short sale, by definition, is subject to a critical contingency: obtaining short sale approval from the seller’s lender(s). No short sale approval, no deal.

Why should a short sale buyer and incur the expense of drafting a comprehensive (and contingent) purchase and sale agreement when there is no guaranty of getting short sale approval? Furthermore, short sale lenders will accept a signed offer from the buyer during the approval process.

When we were first doing short sales, there were many instances where we drafted up purchase and sale agreements and then the short sale approval fell through. We had to charge the client for the drafting work or eat the cost. No one was happy.

Certainly seems that way to me after reading the comments on one of my recent posts.

Having been in this situation myself, I took to heart Brendan's story about his so far fruitless house hunt in the western suburbs.

Brendan and his wife, Emily, want to say goodbye to their urban apartment and find a four bedroom, 2000-square-foot home in reasonable condition.

They'd like to start a family and are looking to spend in the $400,000 to $500,000 range.

Yet the one home he liked, in Natick, he wound up outbid on. Since then, it has been a dreary march through a series of oddly configured, overpriced fixer uppers.

Sounds all fairly typical - to me it was pretty clear that it was just another buyer grappling
with the often tough reality that you can spend a lot on a house inside the I-495 beltway and not have much to show for it.

But Brendan's story, unfortunately, and, to me, inexplicably, struck a very different chord among some of those who follow and comment on this blog.

Today, Bill Kuhlman, CRS, who is the broker/owner of Kuhlman Residential Real Estate, in the Greater Boston area is back to say that some people should not buy real estate.

In response to my post last week, one reader asked, “Has a Realtor ever answered ‘no’ to the question, ‘Is this a good time to buy?’”

He also asked me to list some personal characteristics that would make this not a good time for someone to buy. I’m not sure if these questions mean he thinks this is or isn’t a good time to buy, but thanks for providing me with a lead-in for this week’s post, which is really Part II of last week’s.

Here are a few circumstances which may make this not a good time for someone to buy:

1. They don't want the responsibilities of being a homeowner.
2. Their credit or finances are problematic.
3. They believe the market will move downward at a faster actual-dollar rate than the cost of their housing rental.
4. They like giving their landlord $18,000 to $24,000 a year (and up) for a decent Boston-area apartment or $30,000 to $42,000 a year for a single-family home.
5. They could be looking to pay cash for a property in an area of declining values.

There they go again, those Massachusetts liberals, now pushing for "principal forgiveness" for deadbeat homeowners.

That's been the theme on the comment board of this blog since Massachusetts Attorney General Martha Coakley the other day publicly urged federal mortgage giants Fannie Mae and Freddie Mac to start writing down the principal on mortgages held by struggling homeowners.

But I find it somewhat ironic that many of the folks who are steamed about Coakley's comments - and the fact that the state's congressional delegation is predictably jumping on the bandwagon - are often the first to blast off about Greater Boston's ridiculous home prices.

Here is a sampling Coakley's fairly modest proposal has generated.

This afternoon we learn that the Congressmen Capuano (of Somerville!) teamed with "Bailout Barney" to pen a letter to the FHFA endorsing Coakley's request of principal forgiveness for Massachusetts homeowners.

Sam Schneiderman, Broker-owner of Greater Boston Home Team, discusses the importance of having a team that works together when buying or selling real estate.

Whether you are buying or selling, I believe that a successful real estate transaction requires a team of skilled professionals on your side to give you the best information and protection.

Since most of us watched the Superbowl yesterday, let’s use football as an example.

The quarterback starts with the ball. At some point, the quarterback will either be tackled or will need to pass the ball to a teammate in a better position on the field to continue toward a goal. Good quarterbacks know that they can’t go for glory alone. They survey the field and pass the ball to the player that they feel will be able to gain the best advantage for their team at that moment or they make the run knowing that they will be protected.

Depending upon whether you are the buyer or seller, a good team in a real estate transaction could consist of an agent, attorney, home inspector, contractors, exterminators, financial advisors and/or a professional stager. The strength of the transaction is usually only as good as the weakest member of the team.

Just as a football team needs to be led by the quarterback, a real estate team needs to be led by someone who knows the game, can see the entire field and knows who to pass to at the right time. Obviously, the more often that a team works together, the better the results are likely to be.

OK, maybe this is a stretch. I'll let you decide.

But will the Pats crushing Super Bowl loss wind up having an impact on the future direction of home prices in Foxborough and in neighboring bedroom communities like Norfolk, Walpole and Wrentham?

A Super Bowl win would have arguably bolstered Las Vegas tycoon Steve Wynn's drive to build a mega casino on what are now parking lots owned by Robert Kraft across from Gillette Stadium.

But as Wynn prepares to make another offer to so far recalcitrant Foxboro officials, he will have to do so without being able to wrap himself in Patriots glory, even if only through association with Kraft.

So what does that have to do with home prices in Foxboro, Norfolk and Wrentham? Well, potentially a lot if the Super Bowl loss tips the scales against Wynn's big Foxborough casino.

The discussion about the heating system in one of my client’s condos brought an email about a different configuration.
Here’s a configuration in a newly rehabbed condo that caused problems for the people living there:

The furnace is in eaves on top floor.
Top floor vents are on ceiling.
Lower floor vents are also on ceiling.
The return vent is on top floor, on ceiling above stairway. (So heat goes from first floor ceiling directly up the stairs without reaching warming the lower level.)

There is one zone. The original thermostat is located on an exterior wall at the base of the stairway from lower to upper floor. This gave very false readings. The owners bought a wireless/portable thermostat that they keep downstairs in the winter and bring upstairs in the summer.

The condo downstairs has her heat vents on the floor so the upstairs owners don't get the advantage of her heat rising to heat up our floor.

The problem they experience in winter is that it is cold downstairs and then very hot upstairs. To resolve this, they partially close the upstairs vents in the winter to minimize the heat in the bedrooms. They had to add electric baseboard on the lower level.
In the summer, they open the vents fully to get the AC upstairs.

The other question I have is whether I should remark on solutions, like the electric heat. Is that a solution or is it a sign of a problem? I have a similar question about sump pumps. Are they a solution or a sign that there is a problem? I have concerns that some clients will rule out any house with a sump pump. This could be a mistake, since sometimes a sump pump is a solution and a house without a sump pump could have a water problem, unsolved.

Bet the owners of that $10 million Truro mansion are having some big regrets now as town officials ready the demolition crews.

If you haven't already, check out this Globe story on that spanking new Truro mansion that now faces the wrecking ball after infuriating neighbors and allegedly violating town building rules.

At least from the photos, the 8,333 square foot sprawling, two- story structure looks several cuts above the typical ugly McMansion. But its location may be its undoing - perched on a dune overlooking the Atlantic on a landscape made immortal by painter Edward Hopper.

OK, the owners may have taken some liberties here, and then some - the permit was for an "alteration" of an existing house. The end result was a new home on the site four times the size of the old one.

But is a virtual death sentence - demolition of the entire home - warranted?

Groundhog’s Day corresponds to the Pagan holiday of Imbloc. I enjoy thinking winter is half over. Have you noticed that there is daylight again at 5 PM? Happy Groundhog’s Day!

This time of year is high season for “cabin fever.” If you are unhappy with your living situation, this time of year, you are not alone. Sometimes the decision to move or not is not so simple. For those of you who are unhappy every winter, how can you know if the house is making you unhappy or the household is?

Here’s an example: Recently, I heard met a woman who recently bought another house and was selling her current one. She was surprised what went into choosing to sell her house and move to a quieter setting. She said something like this, “I liked my house but wasn’t content here. My husband and I had to figure out if there was something wrong with our relationship that we weren’t facing, or if we were just in the wrong house.”

If you find yourself unhappy when you get home, how can you figure out if it’s the house or the people in it? The key is thinking about whether you are annoyed when you are with people or when you are alone. The more you are annoyed alone, the more likely the problem is the house.

Extra space comes at as premium here in Greater Boston, a market dominated by older, smaller homes.

The vast majority of homes inside the I-495 beltway were built before the 1970s, when families were bigger and home sizes were typically smaller.

Homes built in the first few decades after World War II are likely to fall in the 2,000-square- feet-and-below range - I am thinking of all those vast tracts of 1950s capes and ranches.

My Natick village colonial is not even 1,800 square feet - and that's after an addition and renovation.

Yet maybe the problem isn't the size of the housing that's out there, but rather our attitude towards it. Even in a modestly-sized house, most of us can point to space we don't use and if push comes to shove, would be hard to justify, at least on a utilitarian basis.

Attorney Richard D. Vetstein writes today about a case regarding mortgage commitment and getting your deposits back. Here is a case where the buyer could not get a loan, but also did not get all deposits returned.

I recently came across a very interesting case from the Appeals Court, Survillo v. McDonough No. 11–P–290. Dec. 2, 2011. The case underscores how carefully attorneys must craft the mortgage contingency to protect the buyer’s deposit in case financing is approved with unexpected conditions.
The buyers submitted the standard Offer To Purchase provided it was “Not subject to the Sale of any other home.” The sellers accepted the offer. The buyers received a conditional pre-approval from a local bank for a first mortgage in the amount of $492,000. The pre-approval also stated that anticipated loan was “[n]ot based on sale of any residence.”

The parties then entered into the standard form purchase and sale agreement (P & S), with the typical mortgage contingency provision for a $429,000 mortgage loan. Due to the buyers’ debt to income ratios, the lender changed the loan into a “piggyback” and with the condition that the buyers list their primary residence for sale prior to the loan closing. The buyers absolutely did not want to list and sell their residence, so they wanted out of the deal.

On the last day of the extended financing deadline, the buyers timely notified the sellers that they had “not received a loan commitment with acceptable conditions,” and attempted to back out of the agreement under the mortgage contingency provision. Ultimately, with the buyers refusing to sell their home, the bank denied the buyer’s the mortgage application based on the fact that the “borrower would be carrying three mortgage payments and the debt to income is too high.”

Sorry, but the great home price collapse is looking about as likely right now as a visit from the Great Pumpkin.

It's hard not to come to that conclusion even with the latest Case-Shiller report.

The picture nationally is rockier than what analysts had predicted. Economists surveyed by Bloomberg had predicted a 3.3 percent drop in home prices nationally for November in the latest Case-Shiller report.

We wound up with a 3.7 percent drop and a 1.6 percent drop in Boston metro prices.

That puts housing values back at spring 2003 levels, or about an 18 percent decline locally, compared to as much as 30 percent nationally.

However, the numbers mask the unfortunate reality home buyers sooner or later find out about the Greater Boston market. The fact is, there really are no bargains out there, just homes, often in need of work, that are somewhat less inflated in price than they were five years ago.

Today, I would like to introduce Bill Kuhlman, CRS, who is the broker/owner of Kuhlman Residential Real Estate, in the Greater Boston area. He is the founder of TheCashBuyerNetwork.com.

Bill writes:

Though I might cover any question posed by a reader or some other topic of the day, my primary focus here will be issues of interest to cash buyers of real estate.

The term cash buyer is anyone who plans to buy real estate without using a mortgage. The term can also apply to a buyer who plans on using a mortgage, but doesn’t plan on using a mortgage contingency with the purchase contract. (This carries significant financial risk, so do not do this unless you’re absolutely certain you can show up with the money to close.)

Help me help you. Before addressing the main topic for today, my question for anyone contemplating being a cash buyer is:

How can I help?
I want to know what you want to know. Your questions will drive my content on Boston.com each week, so feel free to ask any question you like. Other topics, not specific to cash buyers, are welcome, as well.

One question I get all the time is, “Is this a good time for me to buy?” For most buyers, especially anyone planning on financing their purchase, my answer today is, “A lot depends on your personal circumstances, but if you’re in a relatively stable market, as in most communities in Eastern Massachusetts, and if you expect to be in your new home at least four years, this is probably a great time for you to buy a home.” This is especially true for first-time buyers and for trade-up buyers.

For a real estate rebound to take hold, prices don't have to soar. They simply have to get off what has been a relentlessly downward track.

There are signs that this is already happening in Greater Boston, with some towns having actually seen prices rise over the past year while others saw modest declines.

Sales are now starting to rise again, though it's a long climb up from anemic levels not seen since the early 1990s.

Crucially, more buyers may also encourage more sellers to take a chance - right now, as my Monday post noted, the pickings are pretty slim for house hunters right now.

It's hard for the market to gain traction when there is not much to look at.

Sam Schneiderman, Broker-owner of Greater Boston Home Team, discusses short sales.

I recently ran numbers (using MLS) to determine the impact of short sales on the Greater Boston market in 2011. They appear to impact just over 5 percent of the market, depending upon the neighborhood or municipality. It appears that the more affluent the community, the lower the percentage of short sales. In some neighborhoods that I spot-checked up to 13 percent of sales were short sales. The numbers are consistent with 2010.

I was also looking for a statistic that would tell what percentage of short sale listings actually closed. Depending upon the community, I found that 30 to 50 percent of short sale listings did not close. (I didn’t extract the number of repeat listings because that required examining each listing manually. Therefore, my numbers are off somewhat because some short sales are listed more than once to allow enough time to go through the process or get the asking price to where buyers will make offers on them.)

For those that need a review, a “short sale” is the sale of a property by a seller that can’t sell the property for enough money to pay off all of the mortgage balance(s) on the property in full. Sometimes the seller can’t afford to make payments any longer. Sometimes the seller needs to move and can’t afford to pay the lender(s) the difference between the sale price and the mortgage balance(s).

If you are not sure about the details of a short sale, see my October 2009 post:

Brendan and his wife, Emily, thought finding a four bedroom home in the suburbs would be a cinch.

After all, we are in the midst of a seemingly never ending real estate downturn, right?

Well yes and no.

Home sales have been skidding along at record low levels not seen since the early 1990s, though activity has begun to pick up over the past few months.

But prices in more than a few suburbs within have held fairly steady or have gone up over the past year. (I quote Brendan and look at prices in the western suburbs in this Globe West piece that ran yesterday.)

Back to Brendan and his wife, who found themselves outbid for a 1950s colonial in need of work last spring. The Lois Street home, on the market for $430,000, wound up fetching $450,000 after a short but furious bidding war.