One of the dirty little secrets of the mortgage industry is how often loans are sold, exchanged, or transferred. Most homeowners are under the mistaken impression that the loan is held by the company that they originated their loan with. This couldn’t
The board of directors of real estate investment trust Capstead Mortgage Corporation (NYSE: CMO | PowerRating Both dividends will be paid on 30 September 2010 to all stockholders of record as of 20 September 2010. Additionally, the shareholders may
H&R Block Inc., the tax preparer whose stock slid 18 percent last month, told investors yesterday to ignore speculation that it faces a surge in costs tied to its defunct mortgage business. The stock rose almost 10 percent in early New York trading.
Home movers in Scotland in the second quarter of 2010 needed to use less of their income to cover their mortgage interest than anywhere else in the UK, according to new data by the Council of Mortgage Lenders... The proportion fell to 9.3%, the lowest
The last month has seen the biggest increase in mortgage products in over 20 months with over 1,500 new deals available, Mortgage Brain's Monthly Product Analysis shows... The total number of live products listed on its sourcing system increased by 25%
JOHANNESBURG, SOUTH AFRICA -- (Marketwire) -- 09/03/10 -- www.stockcall.com/ : offers investors comprehensive research on the mortgage investment industry and has completed analytical research on Redwood Trust Inc. (NYSE: RWT) and Capstead Mortgage Corp.
JOHANNESBURG, SOUTH AFRICA--(Marketwire - 09/03/10) - www.stockcall.com/ offers investors comprehensive research on the mortgage investment industry and has completed analytical research on Redwood Trust Inc. (NYSE:RWT - News) and Capstead Mortgage Corp.
The home credit sector will return to health when there is more confidence in the market, an expert has said. The home credit sector in the UK will only return to health following the global economic downturn if an increased level of morale in mortgage
For the growing number of struggling homeowners in this country, more help is on the way. Additional aid from the federal government will begin making its way to them next month -- one program would help qualified homeowners refinance their mortgages after seeing their property values fall below the amount they owe, and the other includes another round of funding to help the unemployed or underemployed with their payments.
Home improvement is one of the fastest-growing segments of e-commerce. But the consequences of a bad decision when it comes to finding a contractor or remodeling products online are far worse than buying the wrong paperback.
Plenty of forces, from overly cautious lenders to inaccurate appraisals, are wrecking real estate deals right now. But one of the biggest roadblocks to getting a house sold these days is the disconnect between buyers and sellers.
New home sales unexpectedly fell in July to the lowest level on record as the housing market continued to suffer from the end of the homebuyer tax credit boost.
Would you be willing to pay the original builder a fee when you resell your home? That's an obligation some developers are trying to slap on homeowners in their communities.
With home sales plunging to their lowest level in 15 years, economists warn that a double-dip in housing prices is just around the corner, threatening to further slow the overall recovery.
Treasury yields continued to fall Tuesday, with the yield on the benchmark 10-year note holding near a 19-month low, as a spate of dour economic news has driven investors into safer assets, like government-backed debt.
Applications for mortgage refinancing hit a 15-month high last week as interest rates remained near historic lows, a mortgage bankers' group said Wednesday.
RISMEDIA, September 3, 2010—Following a sharp drop in the months immediately after the expiration of the home buyer tax credit, pending home sales have modestly risen, according to the National Association of Realtors.
The Pending Home Sales Index, a forward-looking…
RISMEDIA, September 3, 2010—Following a sharp drop in the months immediately after the expiration of the home buyer tax credit, pending home sales have modestly risen, according to the National Association of Realtors.
The Pending Home Sales Index, a forward-looking indicator, rose 5.2% to 79.4 based on contracts signed in July from a downwardly revised 75.5 in June, but remains 19.1% below July 2009 when it was 98.1. The data reflects contracts and not closings, which normally occur with a lag time of one or two months.
Lawrence Yun, NAR chief economist, cautioned that there would be a long recovery process. “Home sales will remain soft in the months ahead, but improved affordability conditions should help with a recovery,” he said. “But the recovery looks to be a long process. Home buyers over the past year got a great deal, and buyers for the balance of this year have an edge over sellers. For those who bought at or near the peak several years ago, particularly in markets experiencing big bubbles, it may take over a decade to fully recover lost equity.”
Yun added, “Affordability could reach a generational high in the second half of this year because of rock-bottom mortgage interest rates, helped partly by the Fed’s very accommodative monetary policy. The loan underwriting standards are tighter, but home buyers can improve their chances of getting a loan by staying well within their budget.”
The PHSI in the Northeast rose 6.3% to 62.5 in July but is 21.1% below a year ago. In the Midwest the index increased 4.1% to 66.7 but remains 25.7% below July 2009. Pending home sales in the South rose 1.2% to an index of 86.3, but are 15.6% lower than a year ago. In the West the index jumped 11.6% to 95.0 but is 17.6% below July 2009.
The national index had fallen 29.9% in May and another 2.8% in June.
RISMEDIA, September 3, 2010—U.S. Housing and Urban Development (HUD) Secretary Shaun Donovan announced an unprecedented agreement with the nation’s top mortgage lenders to offer selected state and local governments, and nonprofit organizations a “first look” or right of first…
RISMEDIA, September 3, 2010—U.S. Housing and Urban Development (HUD) Secretary Shaun Donovan announced an unprecedented agreement with the nation’s top mortgage lenders to offer selected state and local governments, and nonprofit organizations a “first look” or right of first refusal to purchase foreclosed homes before making these properties available to private investors.
The National First Look Program is a first-ever public-private partnership agreement between HUD and the National Community Stabilization Trust (Stabilization Trust). In collaboration with national servicers, Fannie Mae and Freddie Mac, the First Look program is intended to give communities participating in HUD’s Neighborhood Stabilization Program (NSP) a brief exclusive opportunity to purchase bank-owned properties in certain neighborhoods so these homes can either be rehabilitated, rented, resold or demolished.
“This groundbreaking agreement will help rebuild neighborhoods that have been struggling with blight and declining home values due to foreclosures,” said HUD Secretary Shaun Donovan. “Local communities will now get an exclusive option to buy foreclosed properties in targeted neighborhoods so they can turn the homes into affordable housing or, in some cases, tear them down. This agreement helps us level the playing field to give communities a better chance to stabilize these neighborhoods.”
“The Stabilization Trust is delighted to be working with HUD Secretary Donovan on the National First Look Program,” said Craig Nickerson, president of the NCST. “By serving as the operations ‘engine’ behind the First Look Program, the Stabilization Trust can facilitate the transfer of more foreclosed property for participating financial institutions to local community buyers, thereby accelerating the road to neighborhood recovery.”
HUD’s NSP grantees, which include state and local governments and non-profit organizations, often find themselves competing with private investors for real estate-owned (REO) properties, which can hinder their efforts to stabilize neighborhoods with high foreclosure activity. With today’s announcement, HUD and the Stabilization Trust, working with national servicers, Fannie Mae and Freddie Mac, will standardize the acquisition process for NSP grantees, giving them an exclusive option to purchase foreclosed upon homes in certain targeted neighborhoods.
The Stabilization Trust pioneered the ‘First Look’ model to create a transparent and streamlined process to facilitate the transfer of foreclosed and abandoned properties from key financial institutions to local government housing providers. First piloted in 2008, the model has gained recognition as a critical tool for positively tipping the scale in neighborhoods hard hit by foreclosures. NSP grantees will also be aided by REOMatch, a Web-based mapping and acquisition management tool developed by the Stabilization Trust. REOMatch will assist NSP grantees to easily identify REO properties and make more strategic decisions about which properties to acquire, based on real-time data on an interactive mapping platform.
The nation’s leading financial institutions are participating in the National First Look Program, representing approximately 75% of the REO marketplace. Participating institutions include: Bank of America, Chase, Citi, Deutsche Bank, GMAC, Nationstar Mortgage, Ocwen Financial Corporation, Saxon Mortgage Services, U.S. Bank, Wells Fargo, Fannie Mae, Freddie Mac and the Federal Housing Administration (FHA).
The National First Look Program will allow NSP grantees the exclusive opportunity to purchase available REO properties located within the defined boundaries of NSP target areas. NSP grantees will be immediately notified when a property becomes available and will have 24-48 hours to express interest in pursuing a specific property. Furthermore, these institutions will provide NSP purchasers with the opportunity to purchase REO properties at a discount of their appraised value, reflecting the cost savings of a quick sale. NSP grantees may acquire these properties with the assistance of NSP funds for any eligible use.
After expressing interest in a property, the First Look Period will last approximately five to 12 business days during which the NSP Grantee will conduct inspections and establish costs to repair in anticipation of the financial institution’s price offer. In the event that no NSP grantee exercises its preference to purchase an REO property during the First Look period, the financial institution will follow its normal process to sell the home on the open market.
Currently, the Federal Housing Administration (FHA) offers a complementary pilot program in which NSP grantees receive an exclusive option to purchase so-called ‘HUD Homes’ at a discount prior to those homes being made available to the investor community. The FHA pilot, alongside today’s agreement expands the opportunity for NSP grantees to gain access to REO properties through a national first-look standard option.
RISMEDIA, September 3, 2010—(MCT)—Some rooms scream “Help!” Others say nothing, and that’s a problem, too. Take the typical bedroom. Michael Payne has seen thousands. “The bedroom tends to get forgotten—you spend all your money elsewhere in the house,” said…
RISMEDIA, September 3, 2010—(MCT)—Some rooms scream “Help!” Others say nothing, and that’s a problem, too. Take the typical bedroom. Michael Payne has seen thousands. “The bedroom tends to get forgotten—you spend all your money elsewhere in the house,” said Payne, a celebrity interior designer and makeover specialist best known for his “Designing For The Sexes” series on HGTV. “You end up with a totally forgettable room that you don’t want your best friend to see.”
Helping people find indoor harmony—particularly at affordable prices—is a common challenge for designers. Instead of moving, homeowners are staying put and trying to make the most of their current house.
“This has been the busiest year I’ve ever had,” said Folsom, Calif., interior designer Jennifer FaGalde. “Absolutely, a lot of people are wanting to stay put and put money into their own home instead of moving. They’re creating a nest within their own space,” she added. “People are staying home more now than they did five, 10 years ago. They want a sanctuary where they can relax.”
But where should you start if you are looking to refurbish your home?
Paint, lighting and flooring are three of the easiest, quickest and least expensive ways to update a room, say the experts.
Arizona Tile’s in-house designer Emitt Isaacks advises people to start makeovers with a very basic question: Who lives in your home?
“A retired couple is very different than a family with young kids. They have different needs and considerations,” he said. “Don’t forget dogs and cats either, as pets influence design decisions, too. Then, start thinking about style—modern, traditional, old-school—and color.”
FaGalde points to two recent makeovers she completed in Sacramento, Calif. A typical home in the Pocket area needed a radical update for its kitchen and three bathrooms. A Land Park house started with a termite invasion and ended up with a remodeled family/living/dining room.
“The Pocket house was a real challenge,” she said. “The bathrooms all had walls separating the toilet area. They had a closed-in feeling, the style of homes 25 years ago. And the rooms were so dark.”
The answer: “We knocked down walls, gutted to zero and started from scratch,” she said. “We added new lighting. It made a huge difference.”
In the aftermath of fixing termite damage, the Land Park homeowners started with paint and flooring, but then decided to update with new window coverings, crown molding and fireplace tile.
“It really transformed the space,” FaGalde said.
Lighting is key, “especially in older homes,” she added. “Lighting enhances your space and shows off the investment you put into it. You spend money on paint and flooring, you want to be able to see it.”
Quick bedroom makeover:
Makeover specialist Michael Payne offers these suggestions:
1. Less is more. An uncluttered bedroom makes for a more restful space. Make use of the area under the bed for storage.
2. Remember: It’s a bedroom. The bed should be the dominant feature. Other furnishings are secondary, but look better if they match in style, wood and stain.
3. Start with the right bedspread or comforter. Use that to pick up colors for paint and carpeting. The result will be more harmonious.
(c) 2010, The Sacramento Bee (Sacramento, Calif.).
Distributed by McClatchy-Tribune Information Services.
RISMEDIA, September 2, 2010—“The Federal Housing Administration (FHA) is giving homeowners and buyers until October 4, 2010 to lock in a low monthly insurance premium,” said Gibran Nicholas, chairman of the CMPS Institute, an organization that trains and certifies…
RISMEDIA, September 2, 2010—“The Federal Housing Administration (FHA) is giving homeowners and buyers until October 4, 2010 to lock in a low monthly insurance premium,” said Gibran Nicholas, chairman of the CMPS Institute, an organization that trains and certifies mortgage bankers and brokers. “After October 4, the monthly insurance premiums on FHA loans will increase by over 63%.”
What does this mean for home buyers?
A home buyer purchasing a $200,000 home using a $193,000 FHA mortgage before October 4 would pay an insurance premium of $88.46 per month. If the same home buyer waits until after October 4, the insurance premium would jump to $148.01.
“In this example, the home buyer would lose $59.55 per month, or $7,146 over a ten year timeframe,” Nicholas said. “Although the upfront mortgage insurance premium is going down after October 4, the real impact to the home buyer is actually a net increase in their out of pocket costs because the monthly premium is going up by 63%. Remember, sellers can pay the upfront premium or it can be financed into the loan amount, so home buyers rarely pay the upfront premium out of pocket. On the other hand, the increase in the monthly premiums will be paid right out of the home buyer’s pocket with their mortgage payment each month.”
Ironically, home buyers who plan to be in the mortgage for less than three years and decide to pay the upfront fee themselves (instead of having the seller pay it for them), may actually save money by waiting until after October 4 to apply for an FHA loan. “Home buyers with a short term time horizon may actually benefit from this change because the upfront premium will be reduced to 1% from 2.25%,” Nicholas said. This change will impact over 30% of the home buyers in today’s market who use FHA-insured financing. Home buyers considering an FHA loan should find and contact a CMPS professional in their area to discuss their options and what this means for their situation. Also, you can follow CMPS Institute on Twitter to stay updated on these and other mortgage and housing industry developments.
RISMEDIA, September 1, 2010—With existing U.S. home sales diving to 15-year lows and millions of homes stagnant on the market, home sellers are suffering increasing anxiety, uncertainty and financial stress. To address these symptoms, motivational author Joan Gale Frank…
RISMEDIA, September 1, 2010—With existing U.S. home sales diving to 15-year lows and millions of homes stagnant on the market, home sellers are suffering increasing anxiety, uncertainty and financial stress. To address these symptoms, motivational author Joan Gale Frank has published Home Seller’s Blues (And How To Beat Them).
“This is the first book of its kind to cheer people on and up when their home isn’t selling,” says Frank, a long-time real estate investor domestically and abroad. “It also provides hundreds of practical tips on how to sell a home faster using buyer/seller psychology.”
When her own Arizona home didn’t sell for a year, Frank gathered extensive home selling advice from top real estate experts, home stagers, landscape artists, psychologists and marketing whizzes. Her research paid off. Frank said, “I was able to pinpoint potential buyers and appeal directly to them, which helped sell my house faster. I also discovered how to be happy instead of miserable while waiting for a buyer.”
Home Seller’s Blues was created to share Frank’s findings with other frustrated home sellers. It features comprehensive home selling tips, including quick, inexpensive ways to make a house memorable, attracting more buyers, finding the best Realtor, win/win pricing, easy ways to get a house ready to show in minutes and identifying little problems that cause home rejection.
Several chapters of the book are dedicated to overcoming negative emotions ranging from fear and frustration to insomnia and helplessness. The book also emphasizes how to enjoy life during the entire home selling experience. “Ms. Frank’s insights into the emotions, psychology and real estate strategies of home selling are right on,” says Alexis Halmy, a Portland, Oregon Realtor.
RISMEDIA, August 30, 2010—Are more Americans positioning themselves for home purchase? Although May’s data showed that home sales were down 26.8% as the home buyer tax credit concluded, a new survey conducted by Relocation.com suggests some families are opting for…
RISMEDIA, August 30, 2010—Are more Americans positioning themselves for home purchase? Although May’s data showed that home sales were down 26.8% as the home buyer tax credit concluded, a new survey conducted by Relocation.com suggests some families are opting for renting while they research—cash in hand—for deals on a new, more desirable home in their area.
Among the key findings of the survey: Of the 60% of individuals moving into rentals, 24% were previous homeowners who are renting temporarily while they look for a new home to purchase. Underscoring this finding is the fact that for many of these families, foreclosure was not the reason for moving—in fact, the number of consumers who moved due to foreclosure dropped by 70%.
Furthermore, many of these families stayed in the area (one in three made a short distance move of 100 miles or less), opting to remain in a location where they already know their schools, shopping districts and prime neighborhoods.
“While the housing market continues to flux from month to month, we’re seeing strong, continued interest as consumers looking to move start their research with us,” said Relocation.com Chairman and Founder Sharon Asher. “These findings suggest that more Americans may be poised to re-enter the housing market this year.”
The Relocation.com survey was conducted in early June 2010 and is a continuation of consumer surveys conducted since March 2009 to gauge moving and relocation attitudes and behaviors.
RISMEDIA, August 19, 2010—Mortgage rates fell to new lows this week, according to the LendingTree Weekly Mortgage Rate Pulse, a snapshot of the lowest and average mortgage rates available within the LendingTree network of lenders.
On August 17, lenders…
RISMEDIA, August 19, 2010—Mortgage rates fell to new lows this week, according to the LendingTree Weekly Mortgage Rate Pulse, a snapshot of the lowest and average mortgage rates available within the LendingTree network of lenders.
On August 17, lenders on the LendingTree network offered mortgage rates as low as 4.00 percent (4.13% APR) for a 30-year fixed mortgage, 3.5 percent (3.85% APR) for a 15-year fixed mortgage and 2.875 percent (3.41% APR) for a 5/1 adjustable rate mortgage (ARM). Rates fell one eighth of a point week-over-week for all product types.
Average home loan rates offered by lenders on the LendingTree network were 4.52 percent (4.70% APR) for 30-year fixed mortgages, 4.14 percent (4.43% APR) for 15-year fixed mortgages and 3.48 percent (3.72% APR) for 5/1 ARMs.
“The current rate spread has widened to 108 basis points or 1.08%, approaching the high of 111 basis points we reached at the end of July,” said Cameron Findlay, Chief Economist of LendingTree.com. “For perspective, the median spread this year has been 74 basis points. So consumers in the market for a home loan should really be doing their homework to ensure they’re getting the best possible deal before locking in a rate. Spreads this wide provide an opportunity for borrowers to take control by using sites like LendingTree.com to negotiate with multiple lenders.”
Below is a state-by-state comparison of mortgage data including a snapshot of the lowest 30-year fixed rates offered by lenders on the LendingTree network, average loan-to-value ratio and percentage of consumers with negative equity.
STATE-BY-STATE MORTGAGE DATA
LOWEST MORTGAGE LOAN-TO- % WITH NEGATIVE
STATE RATE VALUE RATIO EQUITY
The LendingTree Weekly Mortgage Rate Pulse will be published every Wednesday. Home loan rates above are reflective of actual rates offered to borrowers by lenders on the LendingTree network. Lowest rates shown reflect the payment of one discount point. Rates will vary based on the borrower’s loan details and credit profile. Visit www.lendingtree.com to learn more.
RISMEDIA, August 18, 2010—Nationwide housing starts inched up 1.7 percent to a seasonally adjusted annual rate of 546,000 units in July from a downwardly revised figure in the previous month, according to U.S. Commerce Department figures released today. The…
RISMEDIA, August 18, 2010—Nationwide housing starts inched up 1.7 percent to a seasonally adjusted annual rate of 546,000 units in July from a downwardly revised figure in the previous month, according to U.S. Commerce Department figures released today. The gain occurred entirely on the multifamily side, with single-family housing production falling 4.2 percent to 432,000 units.
“Builders are very reluctant to build more homes in view of the current state of the economy and weak buyer demand,” noted Bob Jones, chairman of the National Association of Home Builders (NAHB) and a home builder from Bloomfield Hills, Mich.
“Right now the housing market is essentially in a holding pattern,” acknowledged NAHB Chief Economist David Crowe. “As our latest member surveys have indicated, builders are seeing greater hesitancy among potential home buyers who are uncertain about what’s in store for the economy and jobs going forward. That said, favorable home buying conditions including historically low mortgage rates and low house prices should help spur additional demand as the job market gradually improves later this year.”
The entire 1.7 percent gain in housing production this July was due to a 32.6 percent jump on the more volatile multifamily side, which brought that sector back closer to trend at a 114,000-unit rate following a major dip in the previous month. Meanwhile, single-family housing production declined 4.2 percent to a seasonally adjusted annual rate of 432,000 units, its lowest mark since May of 2009.
Two regions registered improved starts activity in July, with the Northeast and Midwest each posting double-digit gains, of 30.5 percent and 10.7 percent, respectively. The South, which is the country’s largest housing market, posted a 6.3 percent decline in starts this July, while the West posted no change in starts activity.
Permit issuance, which can be an indicator of future building activity, declined 3.1 percent to a seasonally adjusted annual rate of 565,000 units in July. Single-family permits fell 1.2 percent to 416,000 units, while multifamily permits fell 8 percent to 149,000 units. Regionally, permits fell nearly 26 percent in the Northeast, 1.1 percent in the Midwest, and 4.9 percent in the West, but gained 3.9 percent in the South in July.
RISMEDIA, August 18, 2010—More Americans are relying on their mobile devices to access information, quickly and easily. The number of people who sought local information on their smart phones grew 51% last year, with the fastest growing method of…
RISMEDIA, August 18, 2010—More Americans are relying on their mobile devices to access information, quickly and easily. The number of people who sought local information on their smart phones grew 51% last year, with the fastest growing method of accessing this info through downloaded apps.? For on-the-go home buyers, The Real Estate Book / RealEstateBook.com, the leading publisher of real estate information online and in print in North America, launches a new application that provides iPhone, iPod Touch and iPad users with access to all its listings – millions of homes for sale across the U.S. and around the world.
With its latest offering, The Real Estate Book intends to offer a one-stop marketing solution for agents and brokers to reach home buyers and sellers through their local The Real Estate Book, a network of online listing sites, social media tools, direct mail and now an iPhone app.
“We’re always looking to expand our media offerings for real estate agents and brokers to give them a competitive edge,” says Todd Walker, senior vice president of sales and operations. “With our multi-channel marketing solution, they can go into a listing presentation and show the seller how by advertising with The Real Estate Book, they are reaching more prospective buyers than agents who just use an online-only, one-dimensional, channel to market their home.”
The Real Estate Book iPhone app features the millions of property listings for sale across the U.S. and the world available on RealEstateBook.com. The application, available as a free download from Apple’s online App Store, enhances the user experience, offering a suite of features including:
• Search for home listings by city and state/province or zip/postal code
• Map and receive directions to property listings from current location
• View property details and photos of home listings
• Save favorites and share or write notes and attach photos about properties that can be emailed or viewed later
• Email or call the Real Estate Agent directly from the listing
• View past searches and perform advanced searching by bedroom/bath, price, MLS #, or property type
Scott Dixon, president of Network Communication Inc.’s Real Estate Division adds, “Agents today are inundated with marketing options and can spend enormous amounts of time sifting through them. We seek to make it easy and efficient for them to gain the most exposure for their listings. Our new iPhone app delivers on our commitment to drive more leads and the best value to our advertisers.”
RISMEDIA, August 17, 2010—A new study released by Bankrate, Inc. reveals that the costs associated with buying a home may are on the rise. Bankrate’s 2010 Closing Costs Survey reveals that the average origination and title fees on a $200,000…
RISMEDIA, August 17, 2010—A new study released by Bankrate, Inc. reveals that the costs associated with buying a home may are on the rise. Bankrate’s 2010 Closing Costs Survey reveals that the average origination and title fees on a $200,000 mortgage this year totaled $3,741, up from $2,732 in 2009. The full results of the study can be seen here: http://www.bankrate.com/finance/mortgages/2010-closing-costs/.
In the study’s geographical breakdown, New York leads the nation at an average fee of $5,623, with Texas, Utah, San Francisco, and Los Angeles rounding out the top five. Arkansas is the least expensive area with an average fee of $3,007, replacing Nevada, now number 34, at the bottom of the list.
One of the reasons for such a dramatic rise in the average estimated closing costs across the nation has to do with new regulations implemented in January of this year. When providing a potential borrower a Good Faith Estimate (GFE) of costs, regulations now require lenders to provide a Title and Closing Fee estimate within 10 percent of what the final cost will be; in previous years, estimates could fall lower on the spectrum without penalty for the lender.
“The big rise in average closing costs may scare some homebuyers, but it’s important to keep things in perspective,” said Greg McBride, CFA, senior financial analyst for Bankrate.com. “Increased regulation on lenders’ GFEs means more accurate estimates and less expenses popping up for consumers on the back end.”
For this study, Bankrate surveyed one area in 49 states, two areas in California (Los Angeles and San Francisco) and the District of Columbia. Researchers picked a ZIP code in some of the largest cities in each state and requested information on the closing costs for at $200,000 loan. They requested fees on a 30-year, fixed-rate mortgage for a borrower with a 20 percent down payment and good credit to buy a single-family house. Bankrate’s survey includes lenders’ origination fees and title and settlement fees, and not taxes or prepaid items.
RISMEDIA, August 17, 2010—The White House said recently it would spend an additional $3 billion to help distressed homeowners in the states with the highest jobless rates to pay their mortgages.
The latest round of funding pushes the total…
RISMEDIA, August 17, 2010—The White House said recently it would spend an additional $3 billion to help distressed homeowners in the states with the highest jobless rates to pay their mortgages.
The latest round of funding pushes the total federal commitment up to $4.1 billion. The government already runs two other programs to help homeowners modify existing mortgages or make their monthly payments. The White House is authorized to spend up to $50 billion to help homeowners under the Troubled Asset Relief Program originally created by the Bush administration to bail out Wall Street.
So far, existing government programs designed to help people to stay in their homes have met with little success. The rate of property foreclosures climbed 8 percent to 1.65 million in the first six months of 2010 compared to the prior year, according to RealtyTrac.
The new program is meant to prevent further home foreclosures in 17 states plus the District of Columbia. Most of those states have experienced a rash of foreclosures that have depressed the housing market and local economy.
Eligible homeowners could receive no-interest loans up to $50,000 for as long as 24 months. They would have to show a good record of mortgage payment before their employment or medical condition changed. They would also have to demonstrate a “reasonable likelihood” of resuming mortgage payments within two years.
The states with the highest foreclosure rates are Nevada, Florida and Arizona. Nevada and Florida would quality for fresh government assistance but not Arizona, which has slightly lower unemployment rate compared to the national average.
Other states eligible for assistance are: Alabama, California, Georgia, Illinois, Indiana, Kentucky, Michigan, Mississippi, New Jersey, North Carolina, Ohio, Oregon, Rhode Island, South Carolina and Tennessee.
The federal Housing Finance Agency would distribute $2 billion through the so-called Hardest Hit Fund set up earlier this year. The Housing and Urban Development Department would also make $1 billion available via a new emergency program authorized by the recently signed Dodd-Frank law regulating the finance industry.
The money would be given to homeowners who lost their jobs or cannot find enough work and are in danger of losing their homes. People whose medical conditions have also reduced their ability to work would also qualify under guidelines set by the Dodd-Frank law.
Homeowners would apply for relief through their state housing agencies.
Herb Allison, a senior Treasury official, said the goal of the program is to “stabilize a fragile housing market and allows responsible homeowners the chance to reduce their monthly mortgage payments to affordable levels.”
Critics say the relief programs are unfair to homeowners who are current on their mortgage payments. They also argue that much of the money is wasted because distressed homeowners usually default even after getting government help.
The latest Treasury report shows that about 10 percent of distressed homeowners who received modified loans in the fourth quarter of 2009 are delinquent in their payments.
“The default rates are far better than most experts predicted,” Allison said.
The modification program, known as HAMP, helps homeowners to renegotiate with banks to reduce the size of their original mortgages, most of which are much higher than the current value of their homes.
But only 39,000 homeowners were able to qualify for permanent modifications in June and just 400,000 have benefited since the program was enacted, according to government data. And a report by Fitch Ratings Ltd. suggests as many as three-quarters of the modified loans could end up in default once again.
(c) 2010, MarketWatch.com Inc.
Distributed by McClatchy-Tribune Information Services.
RISMEDIA, August 17, 2010—As the vast majority of applicants for loan modification have learned, HAMP, the Home Affordable Modification Program, is little more than a thinly disguised mechanism through which to conclude the foreclosure process on behalf of financial…
RISMEDIA, August 17, 2010—As the vast majority of applicants for loan modification have learned, HAMP, the Home Affordable Modification Program, is little more than a thinly disguised mechanism through which to conclude the foreclosure process on behalf of financial intermediaries who never loaned a dime and never lost a dime on the property.
HAMP has contributed nothing to help the millions of families it promised to help. In effect, it is just another weapon of mass destruction in Wall Street’s consumer assault arsenal.
Wall Street stole borrower’s identities to defraud pension funds out of most of their cash, which they swirled around in a vile concoction of CDOs, special purpose vehicles, non-trust trusts, non-insurance insurance and TARP funds.
These were labeled with ratings inversely proportional to standard underwriting guidelines or even common sense, and slapped together with pages of mind numbing legalese and a few French words.
All of this is part of an ongoing unlawful plan to steal the investor’s money, the homeowner’s equity, collect on insurance and avoid paying taxes or being litigated regarding any of it.
What people entering the HAMP modification process don’t understand, until they are out on the street, is that it wasn’t designed to limit foreclosures; it was intended to expedite them. Tax laws are changing and the race is on to get the defaulted pools off the books while the tax laws are still favorable, and before the evidence of their crimes is discovered.
I’ve talked to people from all over the country who have attempted a modification, and their stories are identical to those being reported by main stream media. So much homeowner paperwork has been lost that it must be having an impact somewhere. They’d need diesel powered shredders and a fleet of trucks running twenty-four-seven to get rid of it all.
The numbers, only 389,000 permanent modifications, and the experiences of homeowners unavoidably suggest that this, too, is all part of a bigger plan.
How the White House can go on ignoring what everyone else already knows is inexplicable. The foreclosure crisis will leave a scar deeper, wider and slower to heal than the Great Depression.
We’ve got foreclosure mill law firms making up bogus documentation to defraud the homeowners of their property, and judges commending these charlatans for their effort and ingenuity in getting ‘er done and helping the court save time. In Florida, they call it the “Rocket Docket.”
Save time? Why not just close the courts down if they have become so burdensome to the judges? Has everyone gone nuts?
And, then last week, just when I thought I had heard everything about how low banksters will stoop to get their credit default swaps, comes now a Stockton, California businesswoman and single mother, Deanna Walters.
In October 2004, she obtained a first mortgage on her residence and shortly thereafter was informed that the servicing of her loan had been assigned to Ocwen Federal Bank FSB.
Ms. Walters thought nothing of it at the time and began making her regularly scheduled payments. But, little did she know that she had been selected for their foreclosure fast track.
Perhaps, they underestimated her financial resources, her will to fight, or her exceptional record keeping, but despite a five-year battle, they have yet to throw Ms. Walters from her home.
Ms. Walters made all of her payments on time and has the evidence to prove it. What she also has is evidence of a criminal conspiracy. Because of her persistence in trying to get her account straightened out, she has been able to reveal and document a pattern consistent with what I have been reporting for several years.
As I have said in the past, servicers do not exist simply to process checks, but rather, to put the borrower over a barrel and then offer more and more expensive “solutions.” True, they don’t want your house, but they do want to keep you in default, as well as, every spare dime you can fork over. They don’t care one way or the other what happens to your home; they’re just the servicing company.
All of the dialogue is finely honed and well-scripted. They will insist that they did not receive your payment, even though they did. They will say that the homeowner is without adequate insurance. They will claim they paid your property taxes, even though they cannot prove it.
Here are some of the tricks I have heard about over and over again, and most of them were used against Ms. Walters.
“We take so long to process our mail it could really cost you.”
Most mortgages have a grace period of sorts. If your payment is due on the first, a late charge won’t be imposed until the 15th. But, your payment is technically late the day after the due date.
That is important because that is when the telemarketers of the servicing firms begin to call. The purpose of this call is to scare you into believing that ”due to extended internal processing times and the unpredictability of mail delivery,” you are going to incur a late fee. To avoid that hefty late charge, they suggest stopping payment on your check and allowing them to take the money directly from your bank account.
Do not be tempted. It will certainly cost you at least for the stop payment on the check, and wouldn’t you know it, the mortgage servicer can also charge you a fee for this.
“We didn’t get your payment and you can’t prove we did.”
You send your check and they cash it. But, no matter how many cancelled checks you trot in front of them, they deny receiving payment.
“Please try our easy-pay program.”
This is the high-tech version of above. Your bank statement shows the payment came out on time, but the mortgage servicer doesn’t credit the payment to your account for two weeks. Late fees begin to mount up while you send copies of your bank statements showing the withdrawals. Nonetheless, they insist you are late, and late on the late fees, and monies start to compound.
“You didn’t pay your property taxes, so we did.”
Here again, they will deny your canceled check or credit card receipt, and without producing any documentation, will insist that they, not you, paid the property taxes and they are entitled to establish an “escrow account.”
“You do not have insurance.”
Or, you do not have enough insurance. We bought some for you. Now, they will exercise their right to open an “escrow account.” That insurance, which covers only them, has an annual premium 10 times that of a normal homeowner policy.
“For your benefit, we’ve established an escrow account.”
The escrow account is where the real financial trickery takes place. No matter how many times you ask, you will never see an accurate accounting of how they arrived at the amount they claim that you owe them.
“We’re here to help in your time of need.”
And, if you do actually fall behind on your payments, they will sniff out money you didn’t even know you had, and wring it out of you.
They will try to get as much money from you as they possibly can. First as a sizable down payment, and then as high a monthly make-up payment as you’ll agree to. They take all of your cash and leave you with a payment that might be 35% to 50% higher.
In the process, you’ll be asked to sign away many of your rights, and you’ll do it because they said they care.
They exploit homeowners at their most vulnerable time because they know that most people would do anything not to lose their home. They intimidate homeowners into suspending judgment and going along out of fear and embarrassment. And, if the homeowner puts up little or no resistance, they will take them all the way to the courthouse steps.
They get paid a small fee to process payments, but when a payment is missed, they can charge whatever fees they want and keep all of the money. They are nothing more than shakedown artists operating in a largely unregulated arena who have figured out a way to wring millions of dollars out of nervous consumers and keep the perfect mix of defaults in the pools.
They get away with all of this because they can. You didn’t choose your servicing company, they chose you. They chose you because they know all about you and know that you will make a good target. You can’t fire them, quit them or take your business elsewhere. Once they begin to destroy your credit, you couldn’t get another loan to pay them back even if you wanted to. And, even if you refinance, there is no guarantee you won’t wind up back with the same servicer.
In a non-judicial foreclosure state, such as California, virtually all foreclosures, whether they are lawful or not, go uncontested so it is very easy for the servicer to manufacture a default.
Lest you doubt their motives, it is a well-known business axiom that you reward the behavior you want.
Read the remarks of the president of Ocwen Loan Servicing, Ronald M. Faris, after a $1.8 million judgment was awarded to a customer. “We make sure our employees are aligned with this effort by paying them incentive bonuses when they succeed in keeping borrowers in their homes.”
Now that sounds noble if not a bit self-serving. But, the incentive isn’t paid for keeping a borrower in their home, it’s a percentage of the money collected while stringing the borrower along. Abuse of borrowers is their business plan, and the longer they keep homeowners in default, the more money they can collect.
In Ms. Walters’ case, they lost payments which she can prove she made, force placed insurance though she has adequate coverage, she was coerced into signing a forbearance agreement, all of which they wanted to rectify with a modification, which Ms. Walters did not need, did not ask for, and had no intention in doing.
Over the years, Ms. Walters paid thousands of dollars in additional fees and charges that were simply manufactured by Ocwen. Then, without even the required notice of sale, a note was left at her house that it had been sold and she needed to move.
Ms. Walters’ attorney, Anne-Marie Dinius of Redwood City, CA, is as feisty and itching for a fight as her client.
“It’s outrageous,” she said with obvious frustration in her voice.
“At least when you deal with the Mafia, you know what you are getting into. Here, what begins as what seems like a small accounting error on the part of the servicer, winds up being the means to make a family homeless. And, rarely can they be stopped.”
“It’s going to take patience, tenacity, intellect and community to unravel the complex web of illegalities that have been routinely perpetrated by lenders, servicers, and the rest of the mortgage machine,” she concluded.
In the months to come, we are going to follow Ms. Walters’ case as it winds its way through the legal labyrinth of California’s foreclosure court. We are going to follow her story as she battles the system and tries to overcome the hurdles to regaining property of which she was unlawfully deprived. Stay tuned.
George Mantor is a nationally respected authority on all areas of real estate and is frequently quoted in a wide range of publications. He is an oft-invited guest of Fox Business Network and for many years, he was the host of “Keepin’ It Real…Real talk about the real thing, real estate” on KCEO radio. His articles have also recently appeared in Real Estate Finance, The Real Estate Professional, National Real Estate Investor, Broker Agent News and Realty Times. His blog is http://www.realtown.com/gwmantor/blog.
RISMEDIA, August 17, 2010—(MCT)—Home sales during the second quarter of this year increased — in some cases significantly — in all but one of 12 west-central Wisconsin counties compared with the same period last year. But that doesn’t mean good…
RISMEDIA, August 17, 2010—(MCT)—Home sales during the second quarter of this year increased — in some cases significantly — in all but one of 12 west-central Wisconsin counties compared with the same period last year. But that doesn’t mean good times for the real estate market.
Those higher home sales figures largely were the result of federal homebuyer tax credits of $6,500 and $8,000 combined with low interest rates, fueling a flurry of home purchases before the credits expired, local Realtors say.
Now that they have expired (qualifying purchases had to be closed by June 1), home sales have slowed significantly. Sales in Eau Claire County for July were down 39 percent compared with the same month last year. Likewise, Chippewa County home sales for last month dropped 36 percent compared with the same period a year ago. In Dunn County, sales plummeted 45 percent.
“It’s really slow right now,” said Eau Claire Realtor Dave FitzGerald, president of the Realtors Association of Northwest Wisconsin.
The homebuyers credit program provided a boost to sales, FitzGerald said, prompting people to buy homes sooner than they otherwise would have. That home sales spike this spring has left a gap in home sales now, pushing down figures that typically are soft in July and August.
A continued sluggish economy also has kept sales figures depressed, he said.
“Some people are concerned they can’t even sell their house, so they’re not even trying,” FitzGerald said.
Count Terry Spitz of Eau Claire among them. He said he has considered selling his south side home for about 18 months “but I can’t get what it’s worth in this market.”
The home sales surge this spring marked a continued increase of home sales throughout the state. Statewide, sales during April, May and June were up 19.4 percent compared with that period last year.
Counties in this part of the state experienced a similar trend. Trempealeau County had the largest increase, at 53.3 percent, followed by Chippewa County at 36.1 percent and Rusk County at 33.3 percent.
Even those counties with a larger number of home sales saw sales growth. In Eau Claire County, 491 homes were sold from April through June compared with 441 during that time last year. Similarly, Chippewa County logged 260 sales compared with 191 in 2009.
Buffalo County was the only county to experience a decrease. Fourteen homes were sold there during the second quarter of this year, down from 26 a year ago.
Bill Malkasian, Wisconsin Realtors Association president, said while the second-quarter sales figures are a plus, improvement in the economy is needed to sustain the long-term health of the real estate sector. He noted that housing prices appear to have stabilized after modest declines and hopes that factor combined with continued low interest rates will improve the housing market.
RISMEDIA, August 16, 2010—The number of price-reduced homes on the market increased 5.3% in July 2010 as compared to June, according to a monthly review of MLS-listed properties within 26 of the country’s largest housing markets conducted by the national
RISMEDIA, August 16, 2010—The number of price-reduced homes on the market increased 5.3% in July 2010 as compared to June, according to a monthly review of MLS-listed properties within 26 of the country’s largest housing markets conducted by the national online real estate brokerage ZipRealty.
Although the number of price-reduced homes increased in July, the median price reduction across the 4,500 cities and communities in 26 markets surveyed slightly declined from June, to $18,949.
“Home buyers this summer have been on the sidelines, waiting to find deals and bargains; so we’re seeing more sellers slashing their list prices to entice these home shoppers to make an offer,” said Leslie Tyler, vice president of marketing for ZipRealty.
Highlights of ZipRealty’s July survey include:
-More than 45% of “for sale” homes included at least one price reduction—an increase of 2.67% compared to June
-”For sale” prices dropped 2.04%—down to a median of $254,987 across the 26 markets surveyed
-In six major metros, more than one out of two home sellers reduced their list price—Jacksonville, Phoenix, Minneapolis, Orlando, Austin and Chicago
-The metro with the highest percentage of price-reduced “for sale” homes continues to be Jacksonville, Fla., where 54% of all July listings had at least one price reduction
-Denver had the lowest percentage of price-reduced homes on the market in July with 32.5%
-Sellers in California housing markets continue to hold steady with prices, compared to other parts of the country; Los Angeles County (39.4%) and the San Francisco Bay Area (40.9%) had the second and third lowest percentage of reduced listings out of all markets surveyed in July
-Buyers in the San Francisco Bay Area again enjoyed the biggest home price discount in absolute dollars, with a median price reduction of $38,000 in July
-Buyers in Houston, Dallas and Raleigh-Durham found the smallest price reductions, with a median price cut of only $10,000 in each of the three markets
-Markets with the largest median price reduction in absolute dollars were: San Francisco ($38,000), Orange County California ($31,000), San Diego ($31,000), Los Angeles ($29,000), Miami/Ft. Lauderdale/Palm Beach ($27,000).
RISMEDIA, August 14, 2010—Selling a house isn’t easy these days. There are a huge number of homes on the market, and buyers are easily scared off if they encounter problems that may negatively impact resale value. Among the many issues…
RISMEDIA, August 14, 2010—Selling a house isn’t easy these days. There are a huge number of homes on the market, and buyers are easily scared off if they encounter problems that may negatively impact resale value. Among the many issues that need to be addressed in order to make a house more marketable, foundation problems rank near the top of the list, according to Walter Molony, an expert in statistics and research at the National Association of Realtors.
“Before a house is listed for sale, the real estate agent will work with the homeowners to make sure that the property is competitive with similar properties in the area,” Molony explains. “A little dampness in the basement or a small drywall crack are flaws that a potential buyer may be willing to overlook,” says Molony, “but a cracked or bowed foundation wall will be a major red flag. Since most home sales are contingent on a satisfactory home inspection, foundation problems are very likely to stop a home sale dead in its tracks.”
Home improvements vs. home repairs
In today’s tight economy, it’s understandable for homeowners to put off home improvements until they feel more financially secure. But it’s important to make a distinction between basic “feel-good” improvements (like painting a room or installing shelving) and repairs that correct safety issues or prevent a problem from getting worse. Fixing a damaged foundation definitely falls into this latter “must-do” category.
“It’s risky to put off fixing a damaged foundation,” says Dave Thrasher, of Nebraska-based Foundation Supportworks. “If a crack starts to enlarge or a wall starts to buckle, you’re seeing a failure that is probably going to get worse,” Thrasher continues. “The longer you wait, the more extensive the problem becomes and the more expensive the repair is going to be.”
Foundation problems follow the building boom
Some foundation problems are obvious—cracks, tilting chimneys and bowing basement walls, for example. But there are other symptoms that may signal a settling or shifting foundation. For example, windows or doors can be racked by a shifting foundation and become difficult to open and close. Drywall cracks that extend from the corners of windows and doors are another telltale sign.
As surprising as it seems, a newer home may be just as likely to have foundation problems as an older one. A Wall Street Journal article (8/13/2009) reported on an entire housing development in California with numerous foundation problems.
According to journalist M.P. McQueen, the decade-long building boom that began in the late 1990s “caused shortages of both skilled construction workers and quality materials. Many municipalities also fell behind inspecting and certifying new homes.” This perfect storm of poor quality control definitely took its toll. Research conducted by Criterium Engineers, a national building-inspection company, confirmed an uptick in the percentage of new homes with major construction defects.
Specialty foundation repair contractors have the right solutions
The good news about foundation problems is that most of them can be corrected, as long as the contractor has the training, tools and materials to do so. “We certainly get our share of calls from panicked homeowners,” says Thrasher. “By the time people call us, they’ve probably realized that local remodeling contractors can only temporarily fix cosmetic problems, but are unable to permanently solve the problem.
RISMEDIA, August 13, 2010—The real estate trend in firming home prices solidified in the second quarter with more metropolitan areas showing increases from a year ago, aided by a surge in home sales driven by the home buyer tax credit,…
RISMEDIA, August 13, 2010—The real estate trend in firming home prices solidified in the second quarter with more metropolitan areas showing increases from a year ago, aided by a surge in home sales driven by the home buyer tax credit, according to the latest survey by the National Association of Realtors. In the second quarter, 100 out of 155 metropolitan statistical areas (MSAs) had higher median existing single-family home prices in comparison with the second quarter of 2009, including 14 with double-digit increases; two were unchanged and 53 metros showed price declines. In the first quarter of this year, 91 areas had higher prices, while only 26 MSAs experienced annual price gains in the second quarter of 2009.
The national median existing single-family price was $176,900 in the second quarter, up 1.5% from $174,200 in the same period of 2009. The median is where half sold for more and half sold for less. Distressed homes accounted for 32% of second quarter sales, down from 36% a year ago.
Lawrence Yun, NAR chief economist, said the correction in home prices appears to have ended in 2009. “All year we’ve been seeing relatively flat national home prices, which appear to be supported by market fundamentals,” he said. “Prices in some areas remain below replacement construction costs, so even with an elevated supply of existing homes on the market, we don’t expect any consequential movement in home prices for the foreseeable future. Very low inventory of newly built homes will also help to support home values.”
Yun urged caution on interpreting price data. “The median price is influenced by the mix of homes that were sold and do not reflect pure appreciation or depreciation,” he said. “The recorded home prices in many markets were significantly depressed last year because of a large percentage of distressed homes sold at discount. Now as more normal, non-distressed home sales are occurring, the median price in many areas is showing higher values.”
Total state existing-home sales, including single-family and condo, rose 9.1% to a seasonally adjusted annual rate of 5.61 million in the second quarter from 5.14 million in the first quarter, and were 17.3% above the 4.78 million-unit pace in the second quarter of 2009.
Sales increased from the first quarter in 44 states and the District of Columbia; 47 states and D.C. had increases over year-ago sales levels.
NAR President Vicki Cox Golder, owner of a Tucson, Ariz.-based firm, said record low mortgage interest rates will help cushion a summer slowdown. “As expected, sales are slowing down now that the home buyer tax credit has expired, but record-low mortgage interest rates, along with stable and affordable home prices in most areas, provide opportunities for buyers who weren’t able to take advantage of the credit,” she said.
According to Freddie Mac, the national average commitment rate on a 30-year conventional fixed-rate mortgage was a record low 4.91% in the second quarter, down from 5.00% in the first quarter; it was 5.03% in the second quarter of 2009.
“Job creation will give home buyers more confidence, but the market over the next few months is likely to be below what we would expect for the size of our growing population,” Golder said. “With improving bank balance sheets, credit restrictions should gradually improve—Realtors are a great resource for consumer information on loan availability as well as neighborhood market conditions, which vary widely.”
In the condo sector, metro area condominium and cooperative prices—covering changes in 55 metro areas—showed the national median existing-condo price was relatively flat at $175,700 in the second quarter, down 0.5% from the second quarter of 2009. Twenty-six metros showed increases in the median condo price from a year ago; the first quarter of 2010 showed 24 metros up, while only four metros saw annual price gains in the second quarter of 2009.
Regionally, the median existing single-family home price in the Northeast declined 3.2% to $238,000 in the second quarter from a year earlier. Existing-home sales in the Northeast jumped 14.9% in the second quarter to a level of 980,000 and are 23.6% above the second quarter of 2009.
In the Midwest, the median existing single-family home price increased 1.4% to $148,500 in the second quarter from the second quarter of last year. Existing-home sales in the Midwest rose 14.5% in the second quarter to a pace of 1.30 million and are 20.9% above the same period in 2009.
In the South, the median existing single-family home price slipped 2.0% to $155,500 in the second quarter from the second quarter of 2009. Existing-home sales in the South increased 10.9% in the second quarter to an annual rate of 2.10 million and are 18.8% above a year ago.
The median existing single-family home price in the West rose 2.6% to $219,700 in the second quarter from a year ago. Existing-home sales in the West fell 2.6% in the second quarter to an annual rate of 1.23 million but are 7.6% higher than the second quarter of 2009.
RISMEDIA, August 13, 2010—The Obama Administration recently announced additional support to help homeowners struggling with unemployment through two targeted foreclosure-prevention programs.
Through the existing Housing Finance Agency (HFA) Innovation Fund for the Hardest Hit Housing Markets (the Hardest…
RISMEDIA, August 13, 2010—The Obama Administration recently announced additional support to help homeowners struggling with unemployment through two targeted foreclosure-prevention programs.
Through the existing Housing Finance Agency (HFA) Innovation Fund for the Hardest Hit Housing Markets (the Hardest Hit Fund), the U.S. Department of the Treasury will make $2 billion of additional assistance available for HFA programs for homeowners struggling to make their mortgage payments due to unemployment. Additionally, the U.S. Department of Housing and Urban Development (HUD) will soon launch a complementary $1 billion Emergency Homeowners Loan Program to provide assistance—for up to 24 months—to homeowners who are at risk of foreclosure and have experienced a substantial reduction in income due to involuntary unemployment, underemployment, or a medical condition.
“We remain committed to helping struggling homeowners, and this program will provide additional assistance to states hit hardest by unemployment,” said Assistant Secretary for Financial Stability Herb Allison. “This is part of the Administration’s comprehensive housing policy that has helped to stabilize a fragile housing market and allows responsible homeowners the chance to reduce their monthly mortgage payments to affordable levels.”
“HUD’s new Emergency Homeowner Loan Program will build on Treasury’s Hardest Hit initiative by targeting assistance to struggling unemployed homeowners in other hard hit areas to help them avoid preventable foreclosures,” said Bill Apgar, HUD senior advisor for Mortgage Finance. “Together, these initiatives represent a combined $3 billion investment that will ultimately impact a broad group of struggling borrowers across the country and in doing so further contribute to the Administration’s efforts to stabilize housing markets and communities across the country.”
Hardest Hit Fund
President Obama first announced the Hardest Hit Fund in February 2010 to allow states hit hard by the economic downturn flexibility in determining how to design and implement programs to meet the local challenges homeowners in their state are facing.
Under the additional assistance, states eligible to receive support have all experienced an unemployment rate at or above the national average over the past 12 months. Each state will use the funds for targeted unemployment programs that provide temporary assistance to eligible homeowners to help them pay their mortgage while they seek re-employment, additional employment or undertake job training.
States that have already benefited from previously announced assistance under the Hardest Hit Fund may use these additional resources to support the unemployment programs previously approved by Treasury or they may opt to implement a new unemployment program. States that do not currently have Hardest Hit Fund unemployment programs must submit proposals to Treasury by September 1, 2010 that, within established guidelines, meet the distinct needs of their state.
The states eligible to receive funds through this additional assistance, along with allocations based on their population sizes include:
Alabama – $60,672,471
California – $476,257,070
Florida – $238,864,755
Georgia – $126,650,987
Illinois – $166,352,726
Indiana – $82,762,859
Kentucky – $55,588,050
Michigan – $128,461,559
Mississippi – $38,036,950
Nevada – $34,056,581
New Jersey – $112,200,638
North Carolina – $120,874,221
Ohio – $148,728,864
Oregon – $49,294,215
Rhode Island – $13,570,770
South Carolina – $58,772,347
Tennessee – $81,128,260
Washington, D.C. – $7,726,678
HUD Emergency Homeowners Loan Program
This new program will complement Treasury’s Hardest Hit Fund by providing assistance to homeowners in hard hit local areas that may not be included in the hardest hit target states. These areas are still being determined.
The program will work through a variety of state and non-profit entities and will offer a declining balance, deferred payment “bridge loan” (zero percent interest, non-recourse, subordinate loan) for up to $50,000 to assist eligible borrowers with payments on their mortgage principal, interest, mortgage insurance, taxes and hazard insurance for up to 24 months.
Under the program, eligible borrowers must:
1. Be at least three months delinquent in their payments and have a reasonable likelihood of being able to resume repayment of their mortgage payments and related housing expenses within two years;
2. Have a mortgage property that is the principal residence of the borrower, and eligible borrowers may not own a second home;
3. Demonstrate a good payment record prior to the event that produced the reduction of income.
HUD will announce additional details, including the targeted communities and other program specifics when the program is officially launched in the coming weeks.
RISMEDIA, August 9, 2010—Home values in the United States continued to decline in the second quarter of 2010, with the Zillow Home Value Index falling 3.2% year-over-year and 0.6% from the first quarter to $182,500. The national rate of decline…
RISMEDIA, August 9, 2010—Home values in the United States continued to decline in the second quarter of 2010, with the Zillow Home Value Index falling 3.2% year-over-year and 0.6% from the first quarter to $182,500. The national rate of decline decelerated from the first quarter, marking the second consecutive quarter of slowing declines, and negative equity fell to 21.5%, according to the second quarter Zillow Real Estate Market Reports.
Negative equity, which refers to the percentage of single-family homeowners with mortgages who are underwater, fell from 23.3% in the first quarter, and from 23% one year ago.
Conditions varied among individual markets across the country. In California, where both federal and state tax credits are available to some homebuyers, more than a quarter (27.8%) of markets tracked by Zillow saw increases in home values in the past year. Home values in five California markets have increased for the past five quarters, and four of those have increased by more than 5% since the second quarter of 2009. The Zillow Home Value Index was up 7.3% year-over-year in the San Diego metropolitan statistical area (MSA); up 5.9% in the San Francisco MSA; up 5.6% in the San Jose MSA; and up 5.5% in the Los Angeles MSA.
Meanwhile, home values in Florida and Arizona continued to show dramatic declines, with home values in the Miami-Fort Lauderdale MSA falling 15.2% year-over-year and home values in the Phoenix MSA falling 11.8%. In the Detroit MSA
“As the national housing market limps toward stabilization, individual markets are a mixed bag,” said Zillow Chief Economist Dr. Stan Humphries. “The double tax credits for some California homebuyers have certainly stimulated housing demand and are partly responsible for the rapid—and likely unsustainable—rates of appreciation in many markets across the state. While there is some uncertainty about how home values will respond in those markets once all incentives are removed, it’s certain they can’t continue at their current rates of appreciation, but is unlikely they will re-test the low points reached in 2009.
“Markets in other parts of the country, like Miami and Phoenix, are not yet showing signs of reaching a bottom in home values. High supply continues to be a challenge in states like Florida and Arizona.
“Nationally, home values are moving in the right direction as rates of decline continue to slow. There is a large unknown on the horizon, however, as these second quarter numbers are still heavily influenced by the federal homebuyer tax credits, which were available for homes under contract by the end of April. Home sales are declining significantly in the post-tax credit environment, but the impact of falling home sales on already-declining home values is yet to be seen. Recent trends in home values suggest the nation could reach a bottom in the latter half of 2010, but we continue to be cautious about the impact of declining home sales.”
Foreclosures again reached a new peak in June, with more than one out of every 1,000 (0.11%) U.S. homes being foreclosed upon during the month.
Foreclosure re-sales fell in June, making up 16.9% of all U.S. home sales during the month, down from a 2010 high of 19.8% in February. Foreclosure re-sales continued to be high in most markets hit hardest by value declines. For example, they made up 55.8% of June sales in the El Centro, Calif. MSA, 54.6% in the Madera, Calif. MSA and 53.6% in the Merced, Calif. MSA. Additionally, more than one-fourth (26%) of home sales nationwide sold for less than what the seller originally paid.
RISMEDIA, August 9, 2010—The real estate industry and especially the mortgage industry have been overwhelmed with changes, regulations and consolidations recently. In the last couple of months, many transactions nationally have experienced delayed closings or worse as a result of…
RISMEDIA, August 9, 2010—The real estate industry and especially the mortgage industry have been overwhelmed with changes, regulations and consolidations recently. In the last couple of months, many transactions nationally have experienced delayed closings or worse as a result of the application of new guidelines affecting APR, Good Faith Estimates (GFE), Truth in Lending (TILA) and condo project approvals to name a few.
There is one more issue that is critical for real estate agents, loan officers, and anyone else who deals with consumers purchasing a home or obtaining a refinance. Effective with applications on or after June 1, 2010, Fannie Mae has issued new lender mandates (FNMA LL-2010-03 Loan Quality Initiative) on a national basis that, if not understood properly, could have devastating consequences for many buyers and sellers. We want to be certain that everyone understands the implications of the new rules and ensure that all interested parties know what they need to know to minimize negative repercussions.
The intent of this initiative is to assure that all applicant information is disclosed and is honest and accurate as of the moment of closing. Lenders will now be required to re-pull credit report information just prior to closing, re-verify employment, validate Social Security numbers, verify intent to occupy and verify that all parties to the transaction have been checked against the national “excluded party” list, which is managed by HUD and by the General Services Administration. Changes in any of these factors are likely to result in a re-underwrite, the need for additional documentation, or suspension of loan closing.
The most onerous of these is the credit re-pull. It is important that this is done as a “soft pull” so it does not show as an inquiry, which could potentially change the borrower’s credit score. Firms will, however, have to match the outstanding debts and inquiries with the report used to approve the loan. Additional credit or increased balances that change the debt-to-income ratio more than 2% (or less if it now exceeds guidelines) will require the loan to be suspended and re-submitted to underwriting.
Any additional delinquencies will result in a new, full credit re-pull and re-underwriting, utilizing the new credit. Any and all inquiries from other lenders or credit suppliers must be verified by the credit bureau and certified that new debt did not occur. If new credit has been extended, the new debt must be included in the borrower’s debt-to-income ratio and the loan must be re-underwritten.
Other considerations are W-2 employees that may own more than 25% of a business, mandating business returns and cash flow analysis and full disclosure of child support and alimony. Changes could render the applicant unqualified or could delay the closing. As a result of TILA, GFE and risk-based pricing changes, additional debt could result in re-pricing the loan due to a change in credit score, which even if approvable, would delay the closing three business days as re-disclosure would be required.
So How Do We Manage the New Process?
Real estate agents and lenders must impress upon the applicants the need for full and honest disclosure at the time of application, during the loan process and at closing. Buyers must be cautioned against applying for new credit during the process, changing jobs (30-day pay stub requirements are being enforced), and charging to their credit cards. It is imperative that they notify the lender if anything changes from application to closing.
We must all be aware that an applicant that signs an erroneous initial or final closing application could be committing fraud. Lenders choosing to approve loans without the proper loan quality processes and documentation are only endangering the buyer. Any lender or real estate agent that encourages someone to falsify information could be equally responsible. It is noteworthy to mention that many loans go through an immediate quality control audit post closing, so this could affect highly qualified applicants as well. Identified fraud of this nature could be investigated by the FBI.
While this new policy was implemented first by Fannie Mae, it is already a mandate of all national lenders and, based on experience, will soon be required on every loan. It is important to keep this in mind on every deal, not just ones that may involve Fannie Mae.
Jim Dinkel is vice president of FM Lending in Raleigh, North Carolina.
Ken Trepeta is director of Real Estate Services for the National Association of REALTORS®.
RISMEDIA, August 9, 2010—With so many homeowners facing tough decisions about their mortgages in or approaching default, questions abound about how to best handle the complex situation with the bank lenders they’re indebted to. To help clarify such confusion…
RISMEDIA, August 9, 2010—With so many homeowners facing tough decisions about their mortgages in or approaching default, questions abound about how to best handle the complex situation with the bank lenders they’re indebted to. To help clarify such confusion and shed light on optimal homeowner options, real estate finance expert Marian Anthony, author of Short Sale RUSH, sheds light on the five most common questions homeowners in default are asking.
1. Should I intentionally default on my home mortgage?
Today, many people are ‘intentionally’ or ‘strategically’ defaulting because cash is more valuable than credit. Because many of the banks were unethical, some borrowers don’t feel the ‘moral obligation’ to pay, especially when the banks are being less than cooperative as buyers try to work things out. Rather than defaulting, the best thing to do is use the Section 702 program of the Obama act, which allows a qualified third-party buyer to take possession and make a ‘bona fide’ offer to the bank. This helps show the debt ‘settled’ on your credit and can eliminate the second mortgages completely. Walking away and allowing the bank to foreclose still allows the second lender to render a judgment—and possibly garnish your wages. You may also have to file for bankruptcy to recover from the credit nightmare.
2. As a borrower, what are some ways I can gain leverage with my mortgage holder?
One way to gain leverage with a lender is to establish a ‘substitute mortgage’—a security pledge that is offered to the seller’s lender, with a third party (lawyer or Escrow company) for a lesser amount of the current payment. Over time, this will result in a significant amount of collected funds that can be used as negotiating leverage to release the borrower from the debt, or dictate terms for a loan modification in the borrower’s advantage.
3. Why have loan modifications and foreclosures become the predominant answer for so many in distressed property situations, and why can this be problematic?
The reason why loan modifications and foreclosures have become the answer for so many is because many real estate professionals erroneously consider the short sale process to be too complex. Not knowing how to orchestrate the transaction and not having the correct forms and contact information with all the different parties is overwhelming for many Realtors, so they forego an option that would otherwise be in the owner’s best interest. The result is unnecessary spending of tax payer’s funds that are being used for the alternative solutions, when capital contributions from the ‘street level’ can be used to offset the losses and payoff the delinquencies without requiring such taxpayer contribution.
4. Why is a short sale strategy more advantageous than a loan modification or foreclosure approach?
The reduced payoff in a short sale can release you from the debt obligation. This allows you to re-establish your credit faster and re-enter the market much wiser. A loan modification actually builds a debt trap around the borrower who is emotionally attached to a property, milking the borrower for every last nickel. A foreclosure ruins a homeowner’s credit and takes a much longer time period to recover from.
5. I’ve heard borrowers in default need a ‘General Public Disclosure?’ Why?
Many people are not aware of the ‘alternatives’ when facing foreclosure. The state and the federal agencies do not provide any literature to default borrowers as a ‘preventative’ measure. Knowing your options, as detailed on a General Public Disclosure document, can make all the difference in establishing a deal that’s in the homeowners’ best interest.
About Marian Anthony
Real estate finance expert, author and speaker, Marian Anthony is the President of Anthony Realty Group (ARG)–a San Diego-based consumer advocacy agency that helps educate real estate professionals throughout Southern California to better assist home buyers and investors. Anthony is also founder of the California Default Mortgage Hotline—a non-profit public interest group availing financially-stressed homeowners in mortgage default with validated information and industry resources.
Located in Forsyth County, the Rocklyn Homes’ community of Champions Run is seeing steady growth due to the family-friendly convenience of its location and homes. During the past few weeks, four pre-sales were purchased and the community is slated to have five more houses under construction in the next couple of weeks.
The neighborhood’s family-friendly atmosphere [...]
Located in the Hamilton Mill area of Gwinnett County, Beyers Landing is convenient to everyday shopping and restaurants in addition to the wonderful, family-friendly area amenities and attractions of the Mall of Georgia, Lake Lanier and Coolray Field home of the Gwinnett Braves.
Beyers Landing consists of 48 new, four to six bedroom homes priced as [...]
Final Opportunities! Only two move in homes remain at Bowen Family Homes’ Kensington Creek Manor. We have a 4 bedroom, 2.5 bath, two story for $162,000 and then a 5 bedroom, 3 bath, two story for $174,000. These homes won’t last long at these prices in this prime location of North Gwinnett County.
These new four [...]
Atlanta Real Estate Forum is pleased to welcome The Orchards Group to the site. This Atlanta area active adult builder started building communities in Atlanta in 1998, and since that time has welcomed homeowners home in 14 communities located throughout Forsyth, North Fulton, Gwinnett and Cherokee counties. Look for updates on new [...]
Continuous and strong growth by his company during a tumultuous period for the housing market has earned Senoia-based builder Jeff Lindsey (pictured) a listing in the Atlanta Business Chronicle’s prestigious “Who’s Who” of “The 100 Key People Who Are Shaping Atlanta’s Housing Industry”. Called a listing of “the top 100 men and women who are [...]
Are you ready to get dressed up and walk down the red carpet? ULI Atlanta will host its 16th annual awards dinner at the Grand Atrium on Peachtree Street on Sept. 16. The event, which begins at 6 p.m., recognizes exceptional real estate developments and individuals across our region. It is the non-profit organizations biggest [...]
Construction Resources reports that clients are falling in love with Saratoga Soapstone, the natural Brazilian surface that can be used for countertops, sinks and even fireplace surrounds. Whether homeowners choose to subtle veins and color variations in the natural product or greater contrast of the waxed surface, they’re finding a surface that is as stunning [...]
Reflecting the trends of increased telecommuting, a rise in home-based businesses and, let’s face it, more constant surveillance of e-mails and social media, an increasing number of (city) new homes include a home office. If you plan to have a home office, you’ll want to talk with your insurance provider to see if you need [...]
Congratulations to both Katie Smith and Peachtree Residential Properties. Katie is the new Sales and Marketing Manager at Peachtree Residential Properties.
Katie was most recently the Marketing Manager at a local homebuilding company as well as a prominent national developer. She is a member of the Greater Atlanta Home Builders Association Sales and Marketing Council and [...]
We’ve spent the last few weeks talking about deals that Sharp Residential has dished up at Liberty Park, and now it is offering another. The fully furnished model home is for sale in this Atlanta townhome community, all for $169,900. Imagine moving in to a home with nothing but a few suitcases; it will surely [...]
Touchstone Homes announces a new single family community located in Flowery Branch. Clarkstone Village is a craftsman style community located just off Spout Springs Road and Thurmon Tanner Parkway on Cantrell Road, less than 2 miles from 985 and the Atlanta Falcons Training Camp. Clarkstone Village is an existing community consisting of 18 homeowners. New [...]
Want to purchase a new home, but your credit score isn’t quite up to par? Now, you can realize your dream of owning a home through the Power 4 Purchase credit enhancement program.
The Power 4 Purchase program is a free credit enhancement tool offered by Bowen Family Homes and their preferred lender, America Home Key [...]
Parkway Villages is offering short sales pricing on the last 6 new homes remaining. These new, never lived in homes are built by Eric Chafin Homebuilders who is an award winning home builder. Reasons to own at Parkway Villages in College Park, South Fulton have never been better!
Parkway Villages community offers a great location in [...]
Many homeowners who sell in the current market are making less on their home than they anticipated. When it’s time to buy the next home, they don’t have as much for a down payment as they would have liked – or maybe even as much as they need.
While it seems unfair that lenders would start [...]
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Touchstone Home is offering additional incentives for home buyers [...]
The stories about housing in Atlanta continue in the news. But one thing is for certain, if you are shopping for Atlanta real estate or Atlanta new homes, now is a terrific time to buy. David Ellis, Executive Vice President of the Greater Atlanta Home Builders Association explains why today is a great time [...]
This past Tuesday, July 13, 2010, we had a great time with many great agents at the Bullsboro Crossing Ask Mary Luncheon on behalf of Morris and Raper Realtors and Peachtree Communities. Among great food, twenty dollars for each agent and good times, we received great feedback from the agents.
Here’s what agents are saying about [...]
Well, there’s really only one “snapshot” Atlanta new home buyers need to worry about – the “snapshot of your financial life” that’s portrayed in your credit report. That’s the way Equifax Personal Finance Blog, expert Robin Holland describes it.
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Atlanta Real Estate Forum was recently able to catch up with Shirley Gary of About Sales, Inc. to chat about the Atlanta new homes market. We asked her what advice she has for Atlanta real estate shoppers and she gave us some great tips for how to find your perfect Atlanta new home. Here’s her [...]
Located in Forsyth County, the Rocklyn Homes’ community of Champions Run is seeing steady growth due to the family-friendly convenience of its location and homes. During the past few weeks, four pre-sales were purchased and the community is slated to have five more houses under construction in the next couple of weeks.
The neighborhood’s family-friendly atmosphere [...]
Located in the Hamilton Mill area of Gwinnett County, Beyers Landing is convenient to everyday shopping and restaurants in addition to the wonderful, family-friendly area amenities and attractions of the Mall of Georgia, Lake Lanier and Coolray Field home of the Gwinnett Braves.
Beyers Landing consists of 48 new, four to six bedroom homes priced as [...]
Final Opportunities! Only two move in homes remain at Bowen Family Homes’ Kensington Creek Manor. We have a 4 bedroom, 2.5 bath, two story for $162,000 and then a 5 bedroom, 3 bath, two story for $174,000. These homes won’t last long at these prices in this prime location of North Gwinnett County.
These new four [...]
Congratulations to both Katie Smith and Peachtree Residential Properties. Katie is the new Sales and Marketing Manager at Peachtree Residential Properties.
Katie was most recently the Marketing Manager at a local homebuilding company as well as a prominent national developer. She is a member of the Greater Atlanta Home Builders Association Sales and Marketing Council and [...]
There is a good chance that if you are a fan of WSB-750 AM that you have or will hear the most recent advertisement for Soleil Laurel Canyon. Truth be told, it’s quite a catchy ad.
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One community in Atlanta that [...]
Builders on a national scale have a clear economic advantage. They build a large amount of homes each year, allowing them discounts from a myriad of vendors. This is an advantage smaller builders and remodelers have been unable to attain, until Custom Builders USA entered the picture.
Custom Builders USA has allowed smaller builders the same [...]
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Small to medium home builders and remodelers around the country have experienced the same significant problem: the cost of labor and materials keeps climbing because they don’t have the same purchasing power as larger builders. Custom Builders Atlanta, under the national umbrella of Custom Builders USA, provides a terrific solution for these builders and remodelers.
By [...]
Five years ago, one of the most destructive natural disasters in our nation's history hit the Gulf Coast. When they hit the coasts of Louisiana and Mississippi, Hurricanes Katrina and Rita took thousands of lives, displaced millions of residents, wiped out hundreds of square miles of coastal land, and inflicted major damage to nearly 300,000 homes.
WASHINGTON - U.S. Housing and Urban Development (HUD) Secretary Shaun Donovan today awarded nearly $312 million to 13 states to invest in efforts to reduce the human, physical, and economic toll of future disasters. The grants announced today are provided through HUD's Disaster Recovery Enhancement Fund (DREF) and are intended to encourage states to undertake activities and long-term strategies that focus on reducing damages from future natural disasters.
WASHINGTON - The U.S. Department of Housing and Urban Development announced today that it is making $189 million in grants available to transform public and assisted housing and to revitalize communities. Appearing in today's Federal Register are the Notices of Funding Availability, the federal application, for two revitalization initiatives: The Choice Neighborhoods FY 2010 and the HOPE VI FY 2010. Both applications can be accessed at www.grants.gov.
WASHINGTON - The U.S. Department of Housing and Urban Development (HUD) today announced that it is charging Testa Family Enterprises, LTD, owner of Royal Arms Apartments in Ravenna, Ohio, and the complex's manager with housing discrimination for allegedly refusing to rent certain apartments to families with young children. HUD's charge alleges that manager Christine Testa and Testa Family Enterprises, LTD, violated the Fair Housing Act by limiting or refusing to rent to families with small children.
SIOUX FALLS, SD - U.S. Housing and Urban Development Secretary Shaun Donovan traveled to a Native American community in South Dakota today to announce $65 million in available funding to support a variety of community development and affordable housing production in Indian country throughout the U.S. Donovan made the announcement following a tour of the Rosebud Reservation in South Dakota with Senator Tim Johnson.
