Tag Archives: foreclosure

Real Estate

Where to Get Honest Foreclosure Help

 

George Adamson the man Who Lived With the Lions See link at bottom of page to go Adamson's home page
George Adamson the man Who Lived With the Lions See link at bottom of page to go Adamson's home page
 Here are places to get help if you or a friend are facing foreclosure.  There are so many scams out there now that it can be difficult to find legitimate help. Be careful of paying money up front in order to get help and some of the Internet advertising that says they guarantee that they can stop your foreclosure.

Here’s a list of programs that are either operated by the U.S. government or have its seal of approval:

  • Call (888) 995-HOPE, the Homeowner’s HOPE Hotline to reach a nonprofit, HUD-approved counselor through HOPE NOW, a cooperative effort of mortgage counselors and lenders to assist homeowners.
  • The Controller of the Currency’s consumer information site for banking-related questions is www.helpwithmybank.gov

Source: Controller of the Currency (04/21/2009)

By the way, check out this site of George Adamson, The man who lived with the lions:

Real Estate

Shall I Walk Away From My Home? Part 2

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walking  

The post I wrote entitled “Shall I Walk Away from my House” drew some real good comments both pro and con.

Shall I walk away from my home? If you are backed against a wall and have no choice, then of course the answer is yes, if you have no other choice. But If you like your house, you can make the payments, then the answer is no. You should have bought your home because you liked it, it appealed to you; it made you happy to have it as your house. The consequences of walking away are that you are going to have to rent because your credit score is down the tubes. Because of your low credit rating you are going to have to rent from three to five years or more because lenders won’t lend money for you to buy a home.

Owning a home is forced savings. You have to make the payments, your principal is going down, and money is depreciating, making your payments lower in relation to your earnings over a period of time.

The primary purpose of owning a home, unless you are an investor, is to live in the house, not to make a profit off of it. I believe that some people got carried away during the housing boom times and bought a home just to make money, not live in it. So if you have a steady job, and feel secure in it, this is just as good a time to stay in your home as any other. The question that goes along with this is: should you buy a home now, if you don’t have one.

The philosophy that I’ve had all my life in regards to a home has been to buy not to rent. I remember when I worked as an engineering aide and making barely enough money to do anything, I bought my first house through a private party with a small down payment. The seller carried the paper.  From that first purchase, a few years later, I was able to trade the home in Diamond Springs for a lot in Nevada City. Since I had the lot free and clear, I was then able to get a loan to have a contractor build a new home for me. My mortgage payment was $175 a month. I was in charge of the Nevada County Engineering Department at that time, and believe me, that mortgage payment was all I could afford. Do you think money has depreciated?

Is this a good time to buy? Is this a good time to hold on to your house if you can? The answer to both of these questions is yes. It’s always a good time as far as I’m concerned. I would rather buy a home than rent. I don’t like to be under a landlord.  Besides, it always seemed a waste of money to pay off someone else’s property when you could be paying off your own.  Time has shown that money depreciates and real estate increases in value.  My first mortgage on the house I had built was $175 a month. I could barely afford it. What can you buy today for $175 a month? Not much, certainly not a home.

Some people have forgotten the value of home ownership during this downturn. All you hear about are the people who are losing their homes. We forget that most of us bought a home to live in, not to make a living buying and selling, or getting into a “get rich” scheme.

So should you stay in your home?  My answer is stay there if you can, or buy one if you can.  History, no matter what people say, shows that real estate goes up and the value of your money goes down. I wish I had that $175 a month mortgage on my present home.  Let me know what you think.

Real Estate

Vandals Strip Vacant Homes in California

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This foreclose home has been stripped of the oven, microwave and range vent, together with 29 missing door knobs, 28 light fixtures, 10 floor registers, eight faucets or shower heads and one air conditioner
This foreclose home has been stripped of the oven, microwave and range vent, together with 29 missing door knobs, 28 light fixtures, 10 floor registers, eight faucets or shower heads and one air conditioner

In real estate It wasn’t too long ago that the biggest game in town for vandals was to strip vacant homes of copper wire and copper plumbing. With copper prices down and so many vacant homes being sold by banks in expensive neighborhoods, the newest game is to strip a house of anything of value as shown in the above picture.

A home in Encinitas – costing $13 million to build and furnish was foreclosed by the bank. It failed to sell at a bank foreclosure auction with a starting bid of $2.3 million. The home left unguarded by the bank, is missing an estimated $1 million worth of fixtures, from antique doors to top of the line toilets.

The 16,000 square foot Spanish hacienda style house is on 1.24 acres in rural east Encinitas. Suzy Brown, an electrical engineer who built the house, surrendered title after not making payments for more than a year and moved out March 22.

“It’s like a car up on blocks,” sheriff’s Detective Steven Ashkar said. “It’s been stripped.”

There are a string of burglaries targeting unoccupied homes in the East Bay Area according to police reports. The thieves are going after “staged” homes, full of expensive furniture, bedding and decorations. .They could be possibly driving, looking for homes for sale, looking for for-sale signs in the yard. Another ploy is to go to an open house that is unoccupied, unlock one window or door for easy access so they can come back to clean out the house.

They could also be going online and looking at homes for sale in particular areas, and doing the virtual tours with the Internet,” explained Orinda Police Sergeant Andre Charles. They could also be going online and looking at homes for sale in particular areas, and doing the virtual tours with the Internet,” explained Orinda Police Sergeant Andre Charles.

Continuing on:

Police in Indio, in Southern California, arrested three people accused of breaking into a dozen houses for sale in nearby communities. They recovered more than $250,000 worth of stolen goods, including artwork.

A home stager in Emeryville, Calif., says thieves took about $11,000 worth of furniture and accessories she had brought to spruce up the homes, “Its devastating,” she says.

So if you are going to sell a home that you don’t live in, be sure and have an alarm system and set it. Tell your real estate agent to inform everyone that nothing is to be removed from your home. Depending on the value of your home, you might want to contract with a security company to guard your home. That’s what the bank did in Encinitas, after they lost a million dollars worth of property.

Real Estate

Banks Banking Their Foreclosures?

bomb
Are the banks holding off putting some of their foreclosures on the market? It looks like they might be to keep the prices of the real estate market from plunging further. Another reason could be that it helps them appear more solvent then they really are.

According to the San Francisco Chronicle

“Lenders nationwide are sitting on hundreds of thousands of foreclosed homes that they have not resold or listed for sale, according to numerous data sources. And foreclosures, which banks unload at fire-sale prices, are a major factor driving home values down.

“We believe there are in the neighborhood of 600,000 properties nationwide that banks have repossessed but not put on the market,” said Rick Sharga, vice president of RealtyTrac, which compiles nationwide statistics on foreclosures. “California probably represents 80,000 of those homes. It could be disastrous if the banks suddenly flooded the market with those distressed properties. You’d have further depreciation and carnage.”

In a recent study, RealtyTrac compared its database of bank-repossessed homes to MLS listings of for-sale homes in four states, including California. It found a significant disparity – only 30 percent of the foreclosures were listed for sale in the Multiple Listing Service. The remainder is known in the industry as “shadow inventory.”

“There is a real danger that there is much more (foreclosure) inventory than we are measuring,” said Celia Chen, director of housing economics at Moody’s Economy.com in Pennsylvania. “Eventually those homes will have to be dealt with. If they’re all put on the market, that will add more inventory to an already bloated market and drive down home prices even more.”

In November of last year, Fannie Mae and Freddie Mac ordered their loan servicers and attorneys not to evict about 16,000 troubled borrowers or sell their homes until they implement a streamlined loan modification program. This might prevent some foreclosures, but the numbers of homeowners facing foreclosures have increased since then.

Where’s the bottom? As I posted yesterday, there are some signs of increased sales and improvement in the economy, so maybe we’re there and maybe not.

Real Estate

Signs of Life in the Real Estate Market

signsoflife

I keep track of the number of pending real estate sales in Nevada County daily and have noticed a healthy increase in pending sales lately. Although many of the sales are short sales and foreclosures, other properties are moving as well. With real estate market values depressed to its present level, buyers are coming back to the market. This includes first time home buyers and investors sensing a buying opportunity of a life time.

According to Rismeida:

“A run of encouraging economic reports that have recently been released may mean the worst, panic-inducing stage of the economic downturn is over. Emphasis on the word may. “I think there are signs of economic life,” Mark Zandi, chief economist at Moody’s Economy.com in West Chester, PA, said. “The downturn is no longer intensifying, and the clearest evidence of this can be found in the retail sector as retail sales have turned since the beginning of the year,” Zandi said.

New-home sales in February jumped 4.7% to an annual pace of 337,000 from a record low in January. February marked the first increase in sales since the summer, and the report added to a string of “better-than-expected” housing data, according to Wachovia Bank economist Adam G. York.”

I believe foreclosures will continue into the next year, as the Alt-A loans come due for readjustment. Some figures indicate that there may be as much as $600 billion in foreclosures still to come from the Alt-A mortgage loans made in the 2006-2007 years. Alt-A loans were the love child of lending institutions and Wall Street when subprime loans were getting a bad name. The subprime loans were repackaged as Alt-A mortgage, bundled and sold to investors. A majority of these bundled loans are now toxic and due to fail.

Real Estate

The Sad Face of a Foreclosure

I was recently asked by an Eastern Bank to do a brokers professional opinion (BPO) as to the listing value of a property. This is not an appraisal, but a value based on six properties that are similar, three recently sold and three that are active that would compete for the property for which the bank wants a listing value.

 We had done an earlier BPO on this property several years ago when the home owners were in the process of building their home.  The bank had given them a loan to build their home and the homeowners wanted additional money to finish their home.

The market at that time was red hot and the value for additional financing was there, based on the value of similar properties in the area.  What a change, going back there now, the owners had left, leaving behind their dreams, broken like the thousands of pieces of garbage they had left behind. Yes, they had left behind a home unfinished, garbage strewn all over the property, vehicles left behind that had been cannibalized. To further complicate matters, it is off the power grid, and the home was provided power by a generator and solar panels, all of that gone, leaving behind only one battery in the living room.

The kitchen was unusable, with the stove inoperable, and in a big mess. I would estimate that before the bank can even put this house on the market, it is going to cost $15,000 to clean up the garbage, haul away the vehicles, (including a trashed RV).  Due to the poor workmanship on the home, the home being off the grid, the cleanup necessary, the bank is going to lose a tremendous amount of money. Of course, this foreclosure will further depress the market in the area, as all foreclosures are doing to all of our property values.

 

Real Estate

Foreclosure Crooks Close To Home

 theives

In the continuing fight against scam artists, the Better Business Bureau of Northern California is warning consumers about bogus loan modification companies that make promises about helping borrowers modify their mortgage loans.

You don’t have to look far from home to find one such company, which according to BBB is ShortRefiNow.com located in Roseville, CA. According to BBB, fourteen people have filed complaints with them. The complaints allege that the people paid between $2,600 and $5,300 up front to ShortRefiNow.com to get their loan modified, but the company did not perform or refund their money.

One woman said she gave ShortRefNow.com $3,000 up front to modify her loan based on a recommendation from a friend. She stated that “I kept getting the runaround. They said “I’m not sure who’s taking care of it. The person taking care of it had emergency surgery,” At that point she said “you know when someone is lying.”

After checking with her lender, she found out they had made one call to the lender and asked how do you do a refinance?

According to KCRA 3:

“Another homeowner told KCRA 3 she paid $5,370 to ShortRefiNow.com to modify her loan. She said the company told her not to talk with her lender directly.

She said the company did not secure a loan modification and did not refund her money.
The Department of Real Estate said consumers need to be very careful when deciding to use a loan modification company.

Companies must be licensed with the DRE. Furthermore, in order to collect advance money, brokers must have a specific agreement called an Advance Fee Agreement, approved by the DRE. Brokers may not collect advance fees if a notice of default has been recorded against a property.”

The DRE issued a Desist and Refrain order against ShortRefiNow.com in February, telling them to stop performing any and all acts for which a real estate license is required until such time as they obtain the required license.

The DRE said borrowers should contact their lender directly to try to work out an agreement or work with a nonprofit housing counselor.”

Real Estate

California Bill Passed to Delay Foreclosures

stop-foreclosure

In order to delay foreclosures and give homeowners more time to deal with their lenders, California has passed a bill to delay the foreclosure proceedings another 90 days beyond the filing of a notice of default. The primary method of foreclosure in California involves what is known as non-judicial foreclosure. This means that court action is not required to foreclose a home. The normal length of time once foreclosure proceedings are started is about 120 days. However there is a 90 day (three months) waiting period prior to the final 30 day foreclosure proceeding. This bill will extend the waiting period from three months to  six months.

The bill was signed into law on February 20th, and became effective until May 22, 2009

This is an excerpt as of the original posted on JD Supra. “As an add-on to the California budget package, Governor Arnold Schwarzenegger signed into law a 90-day moratorium on home foreclosures. This new law, which will become effective on May 22, 2009, requires that lenders wait an additional 90 days from the date of filing of a notice of default before the trustee can give notice of sale in a non-judicial foreclosure. Currently, lenders have to wait three months from the filing of a notice of default before providing the notice of sale, so this law, in effect, creates a six-month waiting period. This extended waiting period is intended to encourage lenders to work with their borrowers and enter into loan modifications. However, whether this aim will be achieved — and even whether this moratorium will apply in a significant number of foreclosures — remains to be seen since there are a number of requirements in the bill that must be satisfied for the moratorium to apply.

The moratorium applies only if:

1. the loan in question is a first lien loan (though it need not be a purchase money loan);

2. the loan was recorded against residential real property between January 1, 2003 and January 1, 2008, inclusive;

3. the borrower occupied the property as the borrower’s principal residence at the time the loan became delinquent;

4. the loan is serviced by a loan servicer that has not implemented a “comprehensive loan modification program”;

5. the loan is not made, purchased or serviced by a California state or local public housing agency or authority and the loan is not collateral for securities purchased by any such agency;

6. imposing such moratorium will not “require a servicer to violate contractual agreements for investor-owned loans;”

7. the borrower has not surrendered the property, as evidenced by a letter confirming surrender or the delivery of keys to the lender;

8. the borrower is not currently in bankruptcy; and

9. the borrower has not contracted with “an organization, person or entity whose primary business is advising people who have decided to leave their homes regarding how to extend the foreclosure process and avoid their contractual obligations to mortgagees or beneficiaries.” “

To read more details go to NuWire”

For further information on foreclosure proceedings go to Foreclosure.com

Real Estate

Fannie Mae Eases Credit To Aid Mortgage Lending

foreclosuresign
Fannie Mae announced that in order to help ownership rates among minorities and low-income consumers, they are going to ease the credit requirements on loans it purchases from banks and other lenders.

The action, which will begin as a pilot program involving 24 banks in 15 markets — including the New York metropolitan region — will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.

Quoting the New York Times:

“In addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers. These borrowers whose incomes, credit ratings and savings are not good enough to qualify for conventional loans, can only get loans from finance companies that charge much higher interest rates — anywhere from three to four percentage points higher than conventional loans.

”Fannie Mae has expanded home ownership for millions of families in the 1990’s by reducing down payment requirements,” said Franklin D. Raines, Fannie Mae’s chairman and chief executive officer. ”Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.”

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980’s.

”From the perspective of many people, including me, this is another thrift industry growing up around us,” said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.”

OH, BY THE WAY, THE DATE OF THIS PUBLICATION WAS SEPTEMBER 30, 1999 
Read the article at New York Times

Real Estate

Subprime Foreclosures, Move Over for Alt-A Foreclosures!

pick1
Gone are the days when subprime loans were what kept bankers up at night, thanks to explosions in other corners of finance. But, In terms of toxicity, subprime loans had no equal. That is until now. The loans of better heeled people are now beginning to go bad at an alarming rate.Alt-A troubled loans have already brought down some banks, including IndyMac, a California bank. Mooney’s, a rating agency, has recently quadrupled its loss projections on bonds backed by Alt-A loans. It now projects losses for 2006-2007Alt-A securities to top 20%, compared to a historical average of under 1%.

 

The problem is that much of the Alt-A lending came at the tail-end of the credit boom in late 2006 and 2007. By then subprime was already getting a bad name. So Wall Street hit on a ruse. What it did was to take borrowers who in normal times would have been subprime and dressed them up as mid-prime!  Many of these loans were doomed from the start.  According to the Bank for International Settlements, a staggering 40% of these American mortgages originated in the first quarter of 2007 were interest only or negative amortization loans.

Alt-A mortgages, were offered to borrowers sandwiched between subprime and prime. These loans were supposed to be for people who had reasonable credit standing but unsteady income, such as the self-employed. The lending institutions had very low standards for these loans, using scant documentation and any way to make a loan, such as exotic negative-amortization mortgages, which allow borrowers to pay less than the accrued interest, with the difference added to the loan balance. Like I said before, the main requirements were to put a mirror in front of your face, if the mirror steamed, it meant you were breathing and you had a loan.

Analysts at Goldman Sachs put possible write downs on the $1.3 trillion of total Alt-A debt, including both securitized and un-securitized loans, at $600 billion, almost as much as expected subprime losses.

So, prepare yourself for another wave of foreclosures, this time the Alt-A mortgages, due to poor lending practices by banks and Wall Street.