Foreclosure Deal Deadline Postponed

Posted on February 3, 2012 by admin

The deadline for states to decide whether to join a proposed nationwide foreclosure settlement with banks was delayed to Feb. 6 from Feb. 3, the Iowa Attorney General’s Office said.  States were given more time to evaluate the proposal, which may total
$25 billion, after at least one asked for a delay, Geoff Greenwood, a spokesman for Iowa Attorney General Tom Miller, said yesterday in a phone interview. Miller is helping to lead negotiations.  State and federal officials have been negotiating an agreement with mortgage servicers that would provide mortgage relief to homeowners and set requirements for how banks conduct foreclosures.

State officials are reviewing the agreement with Bank of America Corp., JPMorgan Chase & Co., Citigroup Inc., Wells Fargo & Co. and Ally Financial Inc., and are being asked to sign on. Greenwood declined to name the state that asked for more time or comment on state support for the deal.  Nevada Attorney General Catherine Cortez Masto said in a Jan. 27 letter to Miller, the Justice Department and US Housing and Urban Development Secretary Shaun Donovan that she needed answers to 38 questions to evaluate the deal. The deadline was changed as Oregon Attorney General John Kroger said today in a statement that he would sign on to the settlement, joining Connecticut Attorney General George Jepsen, who also supports it.  Delaware Attorney General Beau Biden has said he won’t sign on to the settlement.

Posted in Foreclosure, Real Estate News | Tagged , , , , , , , , , , , , , , , , , , , | 1 Comment

2012 Fannie Mae Predicts ‘Moderate Growth’

Posted on January 18, 2012 by admin

The U.S. economy is projected to grow 2.3 percent for the year, according to Fannie Mae’s Economics & Mortgage Market Analysis Group.

Growth will be affected by “fiscal policy issues and political economic uncertainty,” according to Fannie Mae.

The upcoming presidential election, the healthcare debate, and the sovereign debt crisis in the euro zone are three wild cards causing concern for Americans.

Recent improvements in employment have elevated consumers from their “summer rut,” and the housing market is showing some positive indicators, though movement is slow.

“We’re entering 2012 with decent momentum, especially on the employment side,” said Doug Duncan, Fannie Mae’s chief economist.

However, Duncan suggests this momentum will fade over the first half of this year amid “policy changes and challenges that involve the global economy, the domestic economy, and the housing sector.”

Duncan predicts “a year of moderate growth edging away from the 2011 threat of a double dip.”

Posted in Real Estate News | Tagged , , , , , , , , , , , , | 1 Comment

Will Housing Recover by 2013

Posted on January 16, 2012 by admin

A poll of 23 economists and analysts found a consensus for no
change in the S&P/Case-Shiller home price index in 2012, compared
with a median 0.3% decline that was forecast in the last poll in
November.  Many say that a recovery in the housing market is a
key requirement for any vigorous rebound in the world’s largest
economy. The spectacular collapse in US housing, which sent
average prices plummeting by a third, was the trigger for the
2008-09 financial crisis and subsequent recession.  The meager
1.5% gain expected in 2013 will offer little comfort to the
millions of Americans trapped in negative equity — owing more
to their mortgage lender, and in some cases much more, than their
houses are worth.  ”I think we are seeing stabilization, but
unfortunately it’s stability at the bottom,” said Lindsey Piegza,
economist at FTN Financial, describing the grinding halt to
several years of relentless price declines.  The average price of
a US home is currently around where it was nine years ago, and
the most recent data, from October, showed price declines still
accelerating.

The market is still under pressure from an excess of homes up for
sale. Fifteen of 20 respondents said monthly foreclosures should
subside this year, while five didn’t see any let-up until 2013.
Among 20 respondents, 15 said they expect foreclosures to ease
some time this year, while five said it would not happen until
2013.  Gains in home sales and new home construction in November,
and recent improvement in homebuilder sentiment, added only a
touch of optimism at the end of last year.  Still, while the gain
expected over the next two years is tiny compared with the more
than 30% plunge from the peak in 2006, it is still a more cheery
outlook than in some other parts of the world.  A recent Reuters
poll predicted British home prices, which have not dropped
anywhere near as far as they have in the US, will slip 1.7% this
year. In China, they are expected to fall 10 to 20%.

Posted in Foreclosure, Home Buying, Real Estate News | Tagged , , , , , , , , , , , , | 1 Comment

Renovation Make Over, Features of the FHA 203k Streamline Loan

Posted on January 14, 2012 by admin

The FHA 203k Streamline program has gained popularity recently because of the amount of foreclosed homes that are being purchased are in need of repair.  The FHA 203k streamline program can be utilized both as a FHA refinancing option as well as a FHA new home purchase option.

An increasing number of foreclosed homes are using the popular FHA 203k streamline program due these homes needing repair. It is available for either a new home purchase or a refinance and you will need to find a qualified 203k Contractor to help you with these repairs.

The FHA 203k Streamline is a different from the standard Section 203k loan due to it only permitting repairs costing a minimum of $5,000 up to a maximum of $35,000. Thus, the total mortgage loan will permit for property acquisition with up to $35,000 of the loan proceeds to be applied toward repairs or property rehab.

A good 203k contractor can help you with some of the more common repairs completed using the FHA 203k Streamline program include:

• Repair rain gutters and downspouts

• Repair/upgrade of existing HVAC systems

• Minor repairs of plumbing and electrical systems

• Minor repairs of existing flooring

• Minor remodeling that does not involve structural repairs

• Exterior and interior painting

• New appliances – items such as free-standing ranges, refrigerators, washers/dryers, dishwashers and microwaves

• Improvements for people with disabilities/handicaps

• In addition to the FHA 203k streamline program, there is a FHA 203k standard program which will allow more than $35,000 in repairs. The standard 203k loan will cover “major” work such as structural repairs that are not covered under the 203k streamline. Your 203k Contractor or 203k Consultant can help you determine which repairs might be needed.

The FHA 203k standard includes work such as Structural improvements including room additions, re-wiring, major landscape work, patios, decks, terraces, energy conservation improvements, steel insulated exterior doors, rehab or improvement of a detached garage..

Some highlights of the loan include:

The borrower is allowed to finance six months of payments into the loan

Up to six percent of seller contributions are allowed on purchase loans.

As you can see these are some very attractive loans for homebuyers as well as existing homeowners when a property needs a little rehab.

For more information, please contact us. We are 203k Contractors and serve all of Orange County, Los Angeles, Inland Empire and Riverside Counties. If you need a good 203k lender or realtor, we can refer you to a qualified professional.

Posted in 203k Rehab Loan, Home Improvments, Real Estate News | Tagged , , , , , , , , , , , | 1 Comment

What’s Up With All The REO’s?

Posted on January 3, 2012 by admin

Five years into the housing crisis, and foreclosures remain elevated.

We’ve seen temporary lulls in home repossessions that coincided with the implementation of new state and municipal mediation efforts, moratoria enacted as federal programs ramped up, and suspensions of filings as lenders initiated paperwork reviews last fall.

Foreclosure REOBut by all accounts, the foreclosure tide has yet to ebb, and the massive supply of bank-owned homes building over the last half-decade has taken its toll on market fundamentals.

What’s become of all those properties seized by banks? CoreLogic delved into the stats to find out. The company’s analysts took a closer look at the post-foreclosure outcomes of properties since 2006.

In 2006, just as the housing bubble popped, over 355,000 properties proceeded through a foreclosure auction. CoreLogic’s data show that approximately 34 percent (122,000) were successfully bid on by an investor. The remaining 66 percent (233,000) went back to the banks as REO properties.

Of the properties that went into REO, CoreLogic reports that 90 percent (210,000) were liquidated as REO sales to third-party buyers. Nearly half of those sales took six months or less to complete, but 21 percent took 12 months or longer.

Nearly 10 percent (23,200) of the properties added to the REO inventory in 2006 remained in REO as of mid-2010, according to CoreLogic’s analysis. Similarly, of 2007’s REOs, 10 percent have never left the banks’ books.

CoreLogic says investors have shifted from buying properties at foreclosure auction to buying properties at the REO sale, increasing the burden of losses on banks holding REO properties.

The company also found that only 2 percent of the bank-owned homes bought with a mortgage in 2006 have since been foreclosed on again and made an encore appearance as REO.

“This indicates that REO recidivism is not as significant a concern as previously thought,” CoreLogic said in its report.

Posted in Foreclosure, REO, Real Estate News | Tagged , , , , , , , , , , , , , | 1 Comment

Foreclosure backlog could take “decades” to clear

Posted on December 30, 2011 by admin

The number of seriously delinquent mortgages in the nation’s
largest metropolitan areas slowed this year, according to a new
study from the Urban Institute. But foreclosures remain a burden
on the housing market, prompting the policy research group to
call for a resolution to the housing crisis to ensure the
foreclosure backlog is cleared out in a reasonable time period.
The institute said the serious delinquency rate in the 100
largest metro areas slowed to 9.3% in June from 10.4% in December
2009, according to data from Foreclosure-Response.org. The Urban
Institute said the serious delinquency rate is classified as the
share of loans in foreclosure, plus all of those that are more
than 90 days in arrears.  ”The foreclosure inventory that is
building up is going to take an incredibly long time for lenders
to clear,” said Leah Hendey, research associate at the Washington
firm. “At the current pace of foreclosure sales, we are looking
at a process that could take decades to complete. It is critical
that the status of these properties be resolved quickly if we
want to stabilize communities and housing markets.”  This decline
was driven by a drop in delinquent loans, which fell to 3.7% in
June from 5.5% in December 2009.

In hard-hit areas like Riverside and Stockton, Calif., the
foreclosure rate declined significantly, dropping 1.9 percentage
points and 1.7 percentage points from the peak two years ago.
Florida, New York and Illinois experienced a different shift in
the market with foreclosure rates climbing in cities throughout
those states.  In Tampa, the foreclosure rate jumped 2.8
percentage points, and in Chicago, it grew 2.3 percentage points.
Those three states are judicial foreclosure states, which force a
court to make a final decision before a property can leave the
process. This leads to a growing backlog, the Urban Institute
said.  Mortgage originations are down in all of the 100 metro
areas surveyed, as well. Some of the largest drops occurred in
Buffalo, N.Y., where originations fell 39% this year, and Miami,
where new home loans fell 82%, the report said.

Posted in 203k Rehab Loan, Foreclosure, REO | Tagged , , , , , , , , , , , , | 1 Comment

Trulia says more foreclosures coming. Do you know how to sell a 203K home?

Posted on December 29, 2011 by admin

Real estate research and marketing firm Trulia said employment figures improved slightly at the end of 2011, making it possible for more borrowers to pay their mortgages next year.  While Trulia says this trend could reduce 2012 delinquencies, the company expects foreclosures to continue to climb as banks sort through a backlog of distressed properties and foreclosures that stalled in the wake of robo-signing and increased regulatory oversight.  The firm says once a settlement between mortgage servicers and state attorneys general is finalized, many delayed defaults will plunge through the process.  As for what this means for real estate agents, Trulia said an increase in “foreclosures will depress prices for several reasons — foreclosed homes are often sold at a discount and used as comps for non-distressed homes.”  In turn, this will kill seller motivation even though buyers stand to benefit from affordable pricing structures. “Agents should be gearing up with competitive pricing strategies to catch buyers and preparing to counsel their traditional seller-clients about the depressed prices to come in high-foreclosure areas,” Trulia said. For those Americans now confined to the rental market, costs will be rising in 2012 as people losing their homes move toward the rental model. To resolve the issue, high-cost cities need to address the rental shortage directly by having local governments get rid of restrictions and permitting processes that are too stringent, according to Trulia.

203k renovation loanBrian’s Comments: The highlighted text above is evidence that Realtors will need to beef up their selling skills and find new tools for selling this high influx of homes that will be hitting the market. The 203k renovation loan is the perfect model for selling foreclosure homes that may be hard to finance with traditional mortgages because of needed repairs by the seller. Also, by selling a home with a 203k loan, you may be able to sell for higher dollar amount and their by raising comps in the area.

The 203k renovation program is also a great way for contractors to find consistent remodeling and renovation work in this niche market. For more information feel free to email or call me. We can help Realtors and contractors get started with the 203k renovations program. To learn more about what the 203k loan is click here.

Posted in 203k Rehab Loan, Foreclosure, REO, Real Estate News | Tagged , , , , , , , , , , , , , , , | 2 Comments

REO Properties Are Moving Faster

Posted on December 21, 2011 by admin

Homebuyer demand appears to be intensifying, especially among lower-priced REO properties, according to the Campbell/Inside Mortgage Finance HousingPulse Tracking Survey released Tuesday.

Time-on-market for move-in ready REO was just 10.1 weeks in November, the lowest in 15 months, according to the HousingPulse study. Time-on-market for damaged REO was even lower at 9.0 weeks, also the lowest in 15 months.

Distressed properties accounted for a sizeable 46.1 percent of home purchase transactions last month, based on data compiled for the HousingPulse distressed property index which uses a three-month rolling average.

November marked the 23rd month in a row that the study’s distress index has come in above 40 percent.

Short sales were the largest segment of the distressed property market during the month of November, accounting for 17.6 percent of total home purchase transactions tracked in the HousingPulse survey.

Move-in ready REO was the next largest group of distressed properties with a 15.2 percent share, followed by damaged REO which made up 13.3 percent of total transactions.

Non-distressed properties accounted for the remaining 53.9 percent of home purchases in November, according to the survey results.

Despite the uptick in demand, the glut of distressed properties continues to put downward pressure on home prices.

According to HousingPulse, the average short sale sold for $209,200 in November, while the average move-in ready REO sold for $189,700. Damaged REO sold for far lower at $98,600.

At the same time, non-distressed properties sold for an average of $258,900.

The authors of the survey noted in their report that the appraisal system for mortgage originations uses comparative values from both distressed and non-distressed properties, and they say appraisers are often unaware of the interior condition of foreclosed homes or the special circumstances of short sales.

Prices agreed-to in purchase and sales contracts are sometimes not being supported by appraisals for mortgage financing that use disparate comparables, according to the report.

These properties then sell to cash buyers for less, causing declines in average home prices, the authors explained.

Real estate agents responding to this month’s HousingPulse survey commented on the appraisal system and how the low prices for distressed properties impact overall home prices.

“The foreclosure/short sale markets are making it difficult to get non-distressed homes to appraise. This is holding off a market comeback in my area,” reported an agent in Maryland.

“We could sell the homes for more but the appraisals are an issue since they are using short sales and foreclosures as comps,” explained an agent in Florida.

Another agent based out of Michigan added, “Given the multiple offers and the short time on the market, one would expect that prices would be on the increase; however, appraisal guidelines are holding it back.”

The HousingPulse Tracking Survey from Campbell Surveys and Inside Mortgage Finance polls approximately 2,500 real estate agents nationwide each month to assess market trends surrounding homes sales and mortgage lending.

Posted in Foreclosure, REO, Real Estate News | Tagged , , , , , , , , , , , , | 1 Comment

BofA Develops Rental Program

Posted on December 12, 2011 by admin

Bank of America is looking at a new program to rent a home back
to the borrower after foreclosure.  ”There are programs that we
are quite interested in,” said Ron Sturzenegger, who leads the
bank’s legacy asset servicing division. “We are talking with
investors that would come in and buy these houses and would lease
them back to who would now be the now tenant.”  In February, BOA
formed the division to handle the servicing for delinquent
mortgages, loans no longer being written, and to sort out
outstanding representation and warranty claims.  Currently, more
than 35,000 employees at the bank are sorting through 1.1 million
loans 60 days delinquent or worse, according to its third-quarter
financial statement.   The Federal Housing Finance Agency (FHFA)
is working on an REO rental program for Fannie Mae and Freddie
Mac. It received more than 4,000 ideas on how to do it.  But
private banks own $50.4 billion worth of REO properties, too,
according to the Federal Deposit Insurance Corp., and millions of
these homes are sitting vacant. Sturzenegger described how their
idea would work.

“We are looking at programs where you can capture somebody before
the REO process and offer a deed-for-lease. We would go to the
customer and say, ‘We’ll do a short sale. Will you be interested
in leasing your property back? We’re still going to sell the
property. You will no longer be the owner. But you can be a
tenant now in that same property and save you from moving on,’”
he said.  Sturzenegger stressed the bank would still sell the REO
as before in areas where there is a market for them and they can
still get reasonable bids. But some areas are so saturated with
inventory, there isn’t enough investor or homebuyer demand and
properties can sit for years uninhabited.  Rick Sharga, the
executive vice president at Carrington Mortgage Holdings, said in
an interview that many firms, including Carrington are preparing
to participate.  ”We already have the infrastructure and assets
in place to participate effectively,” he said. “Everyone is
waiting on final direction from the FHFA.”  Sturzenegger stressed
the private program at BOA is in its infancy.  ”It’s in the very
early stages,” he said.

Posted in Foreclosure, REO, Real Estate Investing | 1 Comment

Las Vegas No Longer Top Foreclosure City, Hello Stockton Calif.

Posted on November 10, 2011 by admin

Las Vegas is no longer the top foreclosure city in the country. A new Nevada law that went into effect in October caused many mortgage servicers to pause the foreclosure process, knocking Vegas off the spot it held for 22 consecutive months, RealtyTrac said in a report today.  The top spot now belongs to Stockton, Calif., where one in every 143 homes received a foreclosure filing in October. Las Vegas dropped to No. 5.  More than 230,600
US properties received a foreclosure filing in October, a 7% increase from the previous month. It’s another sign servicers are beginning to restart a process held up after months of delays to correct mistakes that surfaced one year ago.  “The October foreclosure numbers continue to show strong signs that foreclosure activity is coming out of the rain delay we’ve been in for the past year as lenders corrected foreclosure paperwork and processing problems,” CEO James Saccacio said. “However, recent state court rulings and new state laws keep changing the rules of the foreclosure game on the fly, creating more uncertainty in the housing market and threatening to prolong the road to a robust real estate recovery.”

Nevada State Assembly Bill 284 took effect Oct. 1, making it a felony if a mortgage servicer or trustee commits false representations concerning a title. There will also be a $5,000 fine assessed if fraud, such as robo-signing, is detected. Servicers are required to provide a new affidavit that provides the amount due on the mortgage, who is in possession of the note and who has the authority to foreclose.  Although Las Vegas doesn’t hold the top foreclosure rate among cities anymore, the state of Nevada is still plagued by foreclosure problems. One in every 180 homes in Nevada received a foreclosure filing in October. Despite that being a 34% drop from the previous month, it’s the still the state with the highest foreclosure rate in the country for the 58thconsecutive month.  Officials within the Nevada attorney general’s office sat down with servicers in October to clarify the law and to continue working on a model affidavit that would satisfy the requirements.  ”I’m confident we can move forward with nonjudicial foreclosures,” said Cathe Cole at the time. She is the vice president of default for Trustee Corps., a designated foreclosure counsel for Freddie Mac. “Some are just waiting for what the uniform affidavits are.”

Posted in Foreclosure, REO, Real Estate News | Tagged , , , , , , , , , , , , | 1 Comment