Category Archives: Real Estate

New Mortgage Deal Could Bring Billions In Relief

February 10, 2012 jd

On Thursday, federal and state officials announced a $26 billion foreclosure settlement with five of the largest home lenders. California is expected to receive approximately $12 billion in principal write-downs, including through short sales, over the next three years, according to the state attorney general‘s office.

The deal settles potential state charges about allegations of improper foreclosures based on robo-signing, seizures made without proper paperwork.
The settlement sets up a federal monitor to oversee the process and try to prevent the challenges that tripped up many homeowners seeking help in earlier programs designed to address the housing crisis.
Most of the relief will go to those who are underwater on their homes. That relief will come over the course of the next three years, with banks having incentives to provide most of the relief in the next 12 months.
At least $17 billion will go to reducing the principal owed by homeowners who are underwater and behind on their mortgages.
Up to 750,000 other underwater homeowners who are current on their mortgages will be able to refinance their current loans at lower rates. They will not receive a reduction in principal, but with mortgage rates near record lows, they could receive substantial savings on their monthly payments.
Approximately $1.5 billion will go to homeowners who had their homes foreclosed upon between Jan. 1, 2008 and Dec. 31, 2011, and who meet other criteria. They will receive up to $2,000 each.
The five mortgage servicers that are parties to the settlement include Bank of America, JPMorgan Chase, Citigroup, Wells Fargo, and Ally Financial (formerly GMAC).

Read the full story

Mortgage deal: What the critics say – CNN (money.cnn.com)
Stalled $26 billion civil mortgage settlement now finalized (agbeat.com)
Mortgage pact to yield billions for California (sfgate.com)
Deal to aid 1 million homeowners; won’t solve housing market’s ills (seattletimes.nwsource.com)

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Real Estate

$26 Billion Deal Could Offer Relief to Home Owners

February 9, 2012 jd

Daily Real Estate News | Thursday, February 09, 2012

After months of tense negotiations, the nation’s five largest banks and state and government officials have agreed to a $26 billion settlement aimed at holding banks accountable for the mishandling of some foreclosures.

The settlement is expected to help 1 million home owners, by having lenders reduce their mortgage debt or refinance into lower mortgage rates to reduce costs of their monthly payments. Also, about 750,000 people who lost their homes to foreclosure from September 2008 to the end of 2011 are expected to receive checks for about $2,000. The aid from the settlement will be distributed over the next three years, The New York Times reports.

“I wouldn’t say it’s a panacea for the housing industry but it is good for the banks to get this behind them,” Jason Goldberg, an analyst with Barclays, told The New York Times about the settlement.

Details of the settlement still need to be finalized, including how many states will participate. Also, federal officials say the final figure could move upwards to $39 billion. Mortgages owned by Fannie Mae and Freddie Mac will not be part of the deal.

The banks involved in the settlement are Bank of America, JPMorgan Chase, Wells Fargo, Citigroup, and Ally Financial.

Source: “States Negotiate $26 Billion Deal for Home Owners,” The New York Times (Feb. 8, 2012)

Federal Blockbusters : By the Numbers: the New $26B Homeowners Settlement (curbed.com)
Banks reach $25 bln mortgage settlement: report (marketwatch.com)
Banks Near $25B Mortgage Abuse Settlement (newser.com)
Faulty Mortgages And Fraudulent Foreclosures Have Cost The Big Banks $72 Billion And Counting (thinkprogress.org)Thinking of buying or selling?For all your real estate needs

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Real Estate

Major Foreclosure Servicer Charged With Forgery

February 8, 2012 jd

Finally, someone is getting indicted for robo signing. Robo signing, if you haven’t heard or know what it was, is having employees signing thousands of false mortgage documents. Read the story below from the New York times for further explanation:

“DocX, one of the largest companies in the nation to provide foreclosure services to lenders nationwide, has been indicted by a Missouri grand jury on forgery charges stemming from foreclosures against home owners in the state.

The indictment marks one of the “few criminal actions to follow reports of widespread improprieties against home owners” nationwide, The New York Times reports.

According to the indictment, DocX is accused of making “mass-produced fraudulent signatures on notarized real estate documents” and could face up to 136 counts of forgery in the preparation of documents used to evict defaulting home owners from their homes. DocX could face a fine of up to $10,000 for each forgery conviction.

DocX is a unit of Lender Processing Services of Jacksonville, Fla. The company is accused of executing and notarizing millions of mortgage documents for banks and lenders the last few years. Lender Procession closed in April 2010 after allegations surfaced of alleged forged documents.

Some of its employees were also indicted last week and could face several years in prison if found convicted.

An attorney for DocX says the company will enter a plea of “not guilty” and declined to comment further about the charges.”

Source: “Company Faces Forgery Charges in Mo. Foreclosures,” The New York Times (Feb. 6, 2012)

DocX faces forgery charges over foreclosures (bottomline.msnbc.msn.com)
DocX Faces Foreclosure Fraud Charges in Missouri – NYTimes.com (lennyesq.wordpress.com)
Missouri AG Chris Koster Files Criminal Charges Against Foreclosure Fraud Document Processor DocX (news.firedoglake.com)
Closed Alpharetta company, founder indicted in robo-signing case (ajc.com)
You: DocX Faces Foreclosure Fraud Charges in Missouri (nytimes.com)

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Real Estate

Mortgage Relief From White House – But You know Congress

February 4, 2012 jd

More mortgage relief from the White House – but congressional OK doubtful

In his State of the Union Address, President Obama laid out a plan to help responsible borrowers and support a housing market recovery. Details of that plan were released yesterday. However, funding for the proposed program must be approved by Congress, lowering the possibility that it will be implemented quickly.

Making sense of the story

Operated by the Federal Housing Administration, the plan would allow underwater homeowners to refinance into cheaper federally insured loans. Borrowers with good credit who are current on their loan payments are eligible.
The measure also streamlines the process of refinancing an underwater mortgage, eliminating the need for an appraisal or submitting a new tax return.
To qualify, borrowers must be current on their mortgage, have a minimum credit score of 580, and must be refinancing a loan on a single-family owner-occupied principal residence.
Lenders only need to confirm that the borrower is employed. Loans that are more than 140 percent of the home value probably would not qualify until banks wrote down part of the balance.
Congress must approve $5 billion to $10 billion in funding, leading housing experts to praise the plan’s objectives with skepticism of it passing this year.

Read the full story

Realtors applaud Obama refinancing initiative (freedommortgage.com)
More mortgage relief from the White House — but congressional OK doubtful (mercurynews.com)
President Reveals New Refi Program Details (mickdoesloans.wordpress.com)
DSnews.com: Obama Details Plan for Mass Refi Program Funded by Largest Lenders (foreclosure-avoidance.com)
Obama proposes home loan refinancing plan – CNNMoney (money.cnn.com)

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Real Estate

Real Estate Investor Busted – Sacramento, California

January 31, 2012 jd

SACRAMENTO, CA—A real estate investor pleaded guilty today in United States District Court in Sacramento to conspiring to rig bids and commit mail fraud at public real estate foreclosure auctions held in San Joaquin County, Calif ., Sharis A Pozen, Acting Assistant Attorney General of the Department of Justice’s Antitrust Division, and Benjamin B Wagner, United States Attorney for the Eastern District of California, announced.

Kenneth A Swanger pleaded guilty to conspiring with a group of real estate speculators who agreed not to bid against each other at certain public real estate foreclosure auctions in San Joaquin County. The primary purpose of the conspiracy was to suppress and restrain competition and to obtain selected real estate offered at San Joaquin County public foreclosure auctions at noncompetitive prices, the department said in court papers.

According to the court documents, after the conspirators’ designated bidder bought a property at a public auction, they would hold a second, private auction, at which each participating conspirator would bid the amount above the public auction price he or she was willing to pay. The conspirator who bid the highest amount at the end of the private auction won the property. The difference between the price at the public auction and that at the second auction was the group’s illicit profit.
Continue reading Real Estate Investor Busted – Sacramento, California →

Real Estate

President Gerald Ford’s Home Up For Sale For $1.699 Million

January 28, 2012 jd

The 6,316-square-foot Rancho Mirage, Calif., home belonging to the late President Gerald Ford and First Lady Betty Ford is up for sale at $1.699 million.

The one-story, flat-roof home overlooks a golf course and features his and her offices, five bedrooms, and six-and-a-half bathrooms. The Ford’s moved into the home after leaving the White House in 1978.

The home still contains the original furniture and looks very similar to the way it did when the Ford’s first moved there, says the real estate agent listing the home, Nelda Linsk. The home still has floral patterns in the bedroom and lime and avocado fabrics featured in the dining and great rooms.

“They were very private people,” Linsk told the Gannett News Service. “They didn’t want anything showy.”

President Ford passed away in December 2006, and Betty Ford died in July 2011.

Source: “Fords’ Rancho Mirage Home Goes up for Sale for $1.7 Million,” The Desert Sun (Palm Springs) (Jan. 23, 2012) and “President Ford’s House for Sale,” Gannett News Service (Jan. 25, 2012)

On the Market: Own the Desert Compound That Gerald and Betty Ford Built (curbed.com)
As have presidential candidates before him, Romney faces controversy over his … – Washington Post (washingtonpost.com)

Real Estate

Unemployed Borrowers Get Reprieve On Their Mortgages

January 27, 2012 jd

Fannie Mae and Freddie Mac recently extended their foreclosure forbearance programs to give short-term aid to unemployed homeowners, but housing counselors warn that these borrowers will need to look at longer-term solutions.

Making sense of the story

In a forbearance program, a lender agrees not to foreclose on a property and gives the borrower several months’ grace from or reduction in monthly mortgage payments. The programs work best for temporary setbacks, like job loss, health problems, or natural disasters.
There are drawbacks to the forbearances though. The most-significant drawback is a larger total debt from the smaller payments. The unpaid balance continues to increase during this time.
The new temporary mortgage payment is often set to 31 percent of the household income; in some cases lenders agree to accept no payments. Fannie Mae’s extended unemployment program, first offered in the fall of 2010, limits any nonpayment or other forbearance plans to one year, with the second six months requiring approval by both Fannie Mae and the lender.
However, even with the program in place, the lender could still report a mortgage as delinquent, which could adversely affect the borrower’s credit score.
Because some agreements add onerous term and conditions, homeowners should also consult with a housing counselor certified by the Dept. of Housing and Urban Development.

Read the full story

Fannie Mae Extends Mortgage Relief for the Unemployed (tominvestor.wordpress.com)
Unemployed Mortgage Holders Get Payment Extension (nytimes.com)
Freddie, Fannie Expanding Mortgage Forbearance (debbyfrank.wordpress.com)

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Real Estate

Cash Buyers Are Driving Home Prices Downward

January 24, 2012 jd

Cash buyers are sending home values down much lower than they otherwise would be, suggests a new survey by Campbell Inside Mortgage Finance, which polled more than 2,500 real estate agents nationwide.

In its December Housing Pulse Tracking Survey, the company found that investors accounted for one out of three real estate transactions last month, and about 74 percent of those purchases by investors were made using all cash.

“Investors have an over-sized command on the market since their ability to pay cash in the majority of transactions puts undue downward pressure on home prices,” an article at Housing Predictor notes about the study.

Cash buyers can be attractive to home sellers, banks, and mortgage companies, since they do not usually come with contingencies, require extra time to secure financing, and tend to move more quickly to closing. As such, cash buyers tend to make purchases at lower prices than those who may need financing or come with contingencies.

Source: “Cash Buyers Pushing Home Prices Lower,” Housing Predictor (Jan. 24, 2012)

Price is not all that matters in real estate sales (reallyhome.wordpress.com)
Why 2012 is the right time to buy a home (freedommortgage.com)
Metro Atlanta, national home prices tumble again (ajc.com)

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Real Estate

Shopping For The Best Mortgage Interest Rates

January 20, 2012 jd

Shopping for the best rates
Interest rates are the lowest in decades, enticing many borrowers to shop for a loan. Mortgage lenders adjust their rates based on perceptions of risk, so unless the borrower can show they’re a low-risk individual, the borrower is unlikely to qualify for a rate that matches those seen in recent advertisements and headlines.

The rates quoted are averages drawn from a variety of financial institutions, and lenders use varied approaches to set them. Consumers who want to try for the lowest rates available need to consider basic factors, such as credit score, points, property type, down payment, and length of the loan.
Credit score: The ideal borrower has a FICO score of 740 or higher, which puts the individual in the best place for pricing.
Points: The lowest rates usually are decreased by paying a fee called a point, or 1 percent of the loan amount. Borrowers may buy points in order to get the best rates at many banks. Points might make sense depending on the borrower’s financial situation and how long they expect to stay in the home.
Property type: Borrowers planning to buy a duplex or a four-unit build likely will have a higher interest rate. Condominiums also may have a rate premium rate, especially if they are newer or the down payment is less than 25 percent. Lenders also may charge more if the borrower is not planning to live in the home.
Down payment: Borrowers who put down at least 25 percent are more likely to obtain the best interest rates. Lenders offer different breaks on rates if equity in the property is higher, so borrowers should ask what is available.
Length of loan: Borrowers who are likely to move in a few years may want to look into an adjustable-rate loan with a low interest rate fixed for a few years, and adjusted afterword.

Read the full story

No Property to provide as Collateral? Unsecured Loans to the Rescue! (choiceofhomes.com)
Peer-to-peer lending: How to borrow from and lend to ordinary people (confused.com)
Mortgages: Mortgages – Shopping for the Best Rates (nytimes.com)

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Real Estate

Good Rental History Can Help Borrowers

January 14, 2012 jd

First-time home buyers planning to purchase a house later this year may have a better chance of qualifying for a mortgage if they have had a history of paying their rent on time.

Last year, credit-reporting agency Experian added a section to millions of credit reports showing on-time rent payments and raised the credit scores of many people. The company said that this year it would add in negative marks, including mentions of bounced checks or of tenants’ leaving before a lease was up.
Incorporating rental payments into credit scores could affect millions of people who have not established credit histories through credit cards, student loan repayments, and other credit sources.
Almost half of consumers considered “high-risk” experienced an increase of 100 points or more after their positive rental history was added, according to Experian’s rent bureau. Those with average or higher scores did not experience major movement.
Although it is still too early to show the effects of the new credit report, which began in December, the changes are intended to allow lenders and consumers to have greater transparency, according to Corelogic.
People who have lost their homes to foreclosure and are now leasing may be able to rebuild their credit histories by being responsible renters.
However, consumer groups and advocates are skeptical, noting that reports are sometimes riddled with mistakes and some landlord-tenant disputes may be difficult to capture in a credit report. Rent may not have been paid, for example, because the furnace was left unrepaired for months.

Read the full story

Related articles

Are you a good tenant? It has value when getting a mortgage!! Read on … (jlorealtor.wordpress.com)
Rental History: Important for Qualifying for a Mortgage? (theevergreenscene.com)
Mortgages: Mortgages – A Good Rental History Can Help Borrowers (nytimes.com)
Tips for Improving Your Credit Score (ally.com)
Is Credit Reporting Going Too Far? (miami.cbslocal.com)

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