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Archive for March, 2010

Step Right Up! $18,000 In Tax Credits! First Time Buyers Can Double Dip!

March 31st, 2010 Categories: Real Estate News

 

Claim Your $18,000!

 

Federal And State Tax Credits Combine For $18,000 Bonanza

 

For A Limited Time Only!  $18,000 Bonanza to California First Time Home Buyers

For two months, from May 1 to June 30, 2010, First Time Homebuyers in California will be able to qualify for both the federal and state income tax credits that add up to a whopping $18,000 in credits.

There is a very tight time frame in order to take advantage of both credits, to be able to get  both tax credits, a first-time homebuyer has to be in contract ( in escrow) for a principal residence before May 1, 2010, and that contract must close  between May 1, 2010 and June 30, 2010.

Here is ne real quick article I found from The Wall Sreet Journal that also explains the timelines.

Tuesday, we told you that the (financially troubled) state of California is poised to offer home buyers up to $10,000 to get off the fence and to the dotted line. The $200 million program, split between first-time buyers of existing homes and new units, should keep the Golden State’s sales moving along post spring-selling season.

But, it might not get off to a peaceful start on May 1: Get ready for a stampede early on as some buyers rush to overlap with the federal tax credit that’s dangling as much as $8,000 to buyers. (Yes, that’s up to $18,000 for buying a house.)

For the federal incentive, contracts must be inked by April 30, while closings have to happen by June 30. The California credit covers closings on existing or new homes on or after May 1, leaving a short window for double dipping. “We already anticipated increased contract activity in March and April due to the federal tax credit with scheduled closings in May and June,” writes Credit Suisse builder analyst Dan Oppenheim. “These buyers will now be eligible for both the federal and state credit and will likely consume a significant piece of the state credit given the first-come, first-serve allocation.”

He estimates the tax credit will benefit about 14,000 new-home buyers, lasting as long as five months. KB Home and Lennar could benefit the most given “their outsized exposure to California at 44% and 25% of ’09 revenues, respectively, vs. the 20% group average.”

Given that the state’s existing sales dwarf new sales – 2009 saw an average of 42,500 closings per month – that allotment should be snapped up in about a month. Stampede, indeed.

Authored by Forth Hoyt | Discussion: 2 Comments »

New And Improved California First-Time Homebuyers Tax Credit Signed

March 25th, 2010 Categories: First Time Buyers, Real Estate News, Sacramento Home Buyers

 

California Homebuyer Tax Credit Will Add $10,000

 

 

 

Californa’s Newest First Time Homebuyers Tax Credit is  for Resale Existing Homes and New Construction!

The CA first time homebuyers tax credit has been revamped, and will now allow a credit for first time home buyers looking for existing (resale) homes, as well as new construction. The passage of this bill is due in large part to CAR’s non-stop continual push in Sacramento over the last few weeks.

Homebuyers can claim 5 percent of the purchase price against their California taxes, up to $10,000.

“I have been up and down the state pushing this important housing bill that will get people off the fence and into homes while creating jobs and stimulating our economy,” CA Gov. Schwarzenegger said in a statement.

The new tax credit will provide $200 million in tax credits for home buyer tax credits, allocating $100 million for qualified first-time home buyers of existing homes, and $100 million for purchasers of new, or previously unoccupied, homes. The eligible taxpayer who purchases a qualified personal residence on and after May 1, 2010, and on or before Dec. 31, 2010, or who purchases a qualified principal residence on and after Dec. 31, 2010, and before Aug. 1, 2011, pursuant to an enforceable contract executed on or before Dec. 31, 2010, will be able to take the allowed tax credit. Again, the credit is equal to the lesser of 5 percent of the purchase price or $10,000, and willl be applied to your taxes in equal installments over three consecutive years. Under AB 183, purchasers will be required to live in the home for at least two years or forfeit the credit (i.e., repay it to the state).

You may or may not remember the last CA tax credit ran out of money and was abandoned well before it was supposed to end, so once again, it is urged that anyone thinking of purchasing a home moves forward as quickly as possible if they want to be assured of securing their $10,000.

Authored by Forth Hoyt | Discussion: No Comments »

Writing a Killer Short Sale Offer in Sacramento

March 19th, 2010 Categories: Sacramento Real Estate Trends, Short Sales

 

Sacramento Short Sales have exploded!

Sacramento Short Sale sellers and their agent’s know that the final decision is being made by the bank and that there is no real reason to counter an offer when it comes in, but well priced short sales will generate multiple offers that will give the sellers and their agents the opportunity to ‘sort through’ and pick the offer most likely to close.  That’s the offer you want to write; an offer that represents the best chance to be be perceived as THE  winning offer from the seller, one that will compel the seller to believe that  are willing to hang with it and wait for an answer; even if it takes several months. Your offer should be written in a way the bank will have no reason to counter it and that will be easily accepted by the bank.

One way to be taken seriously as a buyer is to agree that your deposit be cashed and the money be held in escrow for up to ninety days.

 Here is a link to offer instructions and our custom  addendum that can be found on one of our great sister sites;            realestate-sacramento.net that helps agents writing offers on our short-sales to write the best offer for their clients;

  Forth Hoythas dedicated himself to helping distressed property owners. He has spend hundreds of hours learning from the pre-foreclosure experts and has obtained several designations in this field.  In an effort to offer his clients the best possible results with their short sale transaction…

More questions?

Contact us Today At Forth Hoyt’s Sacramento Short Sale Center

At The Hoyt Group, we have implemented the the following procedures 

• Prior to taking a Seller’s Short Sale Listing, we collect the “Seller’s Financial Package” from the Seller which entails all of the information their bank has asked for. At this time the Seller also agrees to cooperate within our system and agrees to the process you will read below.
• The day the home goes in MLS we send the Seller’s Authorization Form to the bank. This document allows us to communicate with the bank directly.
• We market the property and price the home at, or slightly below, market value until we get an offer.
• The Seller is only looking for ONE contract to send to the bank. The Seller is looking for ONE qualified Buyer with an appropriate offer price that has serious intentions on closing the transaction. When we have this, the seller will fully execute ONE contract to send to the bank.
• The Seller does not accept multiple offers – our transactions function as normal as possible.
• We do not send multiple offers to the bank
• Once an offer is received, we present the offer to the Seller for their review. While the Seller’s bank is the one that approves the Short Sale, the Seller is still the owner of the home and the decision maker on all offers received. The Seller will fully execute the contract if it meets the criteria mentioned above.
• When a contract is fully executed between Buyer and Seller, the home is changed to Short Sale Contingent in the MLS, per MLS rules.
• Once the contract is fully executed, we submit the fully executed contract, a HUD-I, and all of the Seller’s financial documents to the bank to begin the 60-90 day Short Sale process (this is the average length of processing time – some are much quicker).
• The bank then does a valuation on what they feel the home is worth, reviews the offer and all corresponding documentation, and finally issues their decision.

 

1)      Include our customized version of the CAR Short Sale Addendum

2)      Include an As-is Addendum with your offer

3)      On page 1 of the contract

              1.D   Close of Escrow 45 days or sooner after 3rd party approval

                                 (see SS Addendum) where it ask for COE Date

              2.C (2)   Be sure and “check” FHA or VA if your buyers loan is

                                       a FHA or VA loan. 

             2.D   If requesting closing costs assistance please do so on

                                 these lines, in this format.  “Seller’s lender shall credit

                                 Buyer “X” dollar amount of “X” percent of sales price

                                 towards Buyer’s closing cost including but not limited to

                                 the costs of items 4.A – 4.E on page 2 of the contract.”

4)   Page 2 of the contract

                         4.A  (1) Most banks will pay for Pest Inspection, However,

                                       they will not pay for any  Section 1 repairs. 

                         4.B  (1-5) With the exception of Chase, most banks will pay for

                                           these inspections. Not Repairs.

                         4.C  (1-2) Most Banks will pay for these Government

                                           Requirements.

                         4.D  (1-2)  Please mark all closing costs as being paid for by

                                            the Buyer. (we’ll address how to ask for those

                                           appropriately on page 1 if the Buyer needs

                                           closing costs assistance)

                         4.E   (1-2)  Please mark paid by Buyer. These cost can be

                                            added into Buyers closing costs.

                         4.E   (3-4)  Most banks will pay all fees associated with

                                            HOA’s.

                         4.E   (5-6)  Do not request the bank to pay for a home

                                             warranty. If the buyer would like a home

                                            inspection, mark “Buyer to Pay”.

5)  Page 3 of the contract

                         8.B   (1-5)  Unless included in the MLS listing, all personal

                                             property items are not included in the sale.

6)  Page 6 of the contract

                         25.E   Add Short Sale Addendum and Addendum A.

 

Be the first one there, write a good, clean offer!

 

More questions?

Contact us Today At Forth Hoyt’s Sacramento Short Sale Center

Authored by Forth Hoyt | Discussion: No Comments »

Sacramento Real Estate and California Sales for February

March 19th, 2010 Categories: Real Estate News, Sacramento Real Estate Trends

Sacramento County has seen a huge increase in  homes that went pending in February but actually saw a decrease in the number of closed escrows both month over month and year over year.

 

Dataquick Roperts California Market Stats:

An estimated 28,111 new and resale houses and condos were sold statewide last month. That was up 0.9 percent from 27,858 in January, and down 3.8 percent from 29,225 for February 2009. California sales for the month of February have varied from a low of 20,513 in 2008 to a peak of 48,409 in 2004, while the average is 32,325. MDA DataQuick’s statistics go back to 1988.

The median price paid for a home last month was $249,000, up 0.8 percent from $247,000 in January, and up 11.2 percent from $224,000 for February a year ago. The year-over-year increase was the fourth in a row, following 27 months of year-over-year declines. The median peaked at $484,000 in early 2007 and hit a low of $221,000 last April.

Of the existing homes sold last month, 44.3 percent were properties that had been foreclosed on during the past year. That was up from a revised 43.8 percent in January and down from 58.8 percent in February a year ago, the all-time high.

The typical mortgage payment that home buyers committed themselves to paying last month was $1,068. That was up from $1,064 in January, and up from $976 for February a year ago. Adjusted for inflation, last month’s mortgage payment was 50.2 percent below the spring 1989 peak of the prior real estate cycle. It was 59.6 percent below the current cycle’s peak in June 2006.

MDA DataQuick is a division of MDA Lending Solutions, a subsidiary of Vancouver-based MacDonald Dettwiler and Associates. MDA DataQuick monitors real estate activity nationwide and provides information to consumers, educational institutions, public agencies, lending institutions, title companies and industry analysts.

Indicators of market distress continue to move in different directions. Foreclosure activity has declined somewhat but remains high by historical standards. Financing with multiple mortgages is low, down payment sizes are stable, cash and non-owner occupied buying is up, MDA DataQuick reported.

Copyright MDA DataQuick Information Systems. All rights reserved.

Authored by Forth Hoyt | Discussion: No Comments »

A Tale of Two Markets: Sacramento Real Estate Market Trends

March 9th, 2010 Categories: Sacramento Real Estate Trends

Sacramento real estate trends are showing a huge disparity between homes priced under $250,000 and those priced over $250,000

Check out the numbers:

under 250k over 250k 250-350k 350-450k 450-600k 600-800k 800-1mil over 1mil

It is no secret that lower priced homes sell faster.  That is true in any market and is definitely true here in Sacramento.  I was doing some research on our new Trendgraphics while getting ready for a listing appointment tonight and started moving the minimum-maximum prices around on the search tool/website and was surprised to find where our median price of homes available is her in Sacramento/Placer/El Dorado Counties.

The median price of all 6159 homes on the market in these three counties is somewhere between 250 and 300k.  Now this is  the lower half of the median price of all active homes for sale in these three counties. I thought I’d error on the conservative side and picked $250,000 for my reports: the system doesn’t have capabilities to search any closer than in 50k increments.  There are 2903 under 250k and 3256 over 250k…

I looked at the homes in the lower half of median into one statistical group.  The upper price range I took apart and went much deeper to reveal some startling trends.

This first chart is all homes who’s active price is less than 250k. This group of homes have  1.3 Months  of Inventory based on Pended sales and  2.9 months of inventory based on closed sales. This includes ALL types of sales; including Bank Owned (REO,)  Short Sale, and Equity Sale.  On the same chart, those same homes have an median price of $160,000 an average active price of 167k and an average sold price of  157k.

Here is more information on this same group of homes: all under 250,000 Active Price in Sacramento, Placer, El Dorado Counties.

Date	2/09	3/09	4/09	5/09	6/09	7/09	8/09	9/09	10/09	11/09	12/09	1/10	2/10
For Sale	4894	4596	3821	3384	3049	2352	2167	2125	2302	2330	2571	2797	2903
New Listing	1804	2285	1816	1795	2050	2127	1933	2013	2097	1747	1873	2100	2056
Sold	1387	1553	1564	1496	1602	1634	1418	1478	1562	1270	1459	1086	1004
Pended	1761	2112	2201	1941	1973	2127	2010	1714	1584	1357	1307	1678	2247
Months of Inventory based on Closed Sales	3.5	3.0	2.4	2.3	1.9	1.4	1.5	1.4	1.5	1.8	1.8	2.6	2.9
Months of Inventory based on Pended Sales	2.8	2.2	1.7	1.7	1.5	1.1	1.1	1.2	1.5	1.7	2.0	1.7	1.3
Absorption Rate based on Closed Sales	28.3	33.8	40.9	44.2	52.5	69.5	65.4	69.6	67.9	54.5	56.7	38.8	34.6
Absorption Rate based on Pended Sales	36.0	46.0	57.6	57.4	64.7	90.4	92.8	80.7	68.8	58.2	50.8	60.0	77.4
Avg. Active Price	154	157	160	160	161	162	165	166	167	168	165	165	167
Avg. Sld Price	141	143	141	148	154	151	155	155	157	159	157	154	157
Avg. Sq. Ft. Price	101	100	100	101	106	107	107	107	109	111	110	108	109
Sold/List Diff. %	99	99	99	99	100	101	101	101	101	101	100	100	100
Sold/Orig LP Diff. %	91	90	91	92	95	96	97	97	98	98	97	97	97
Days on Market	51	56	55	56	51	52	46	47	48	46	52	52	57
Avg CDOM	77	79	79	78	71	70	64	64	62	62	68	70	69
Median Price	142	145	140	152	159	156	160	159	160	161	160	155	160

Contrast This

This  portion of the real estate market (under 250k)  in the Sacramento Metro Area is much different from those homes that are in the higher side of the median active sale price.

Please understand, this is really no big surprise; we all know the higher priced homes take longer to sell. My big AHA!! was how many of these there are…

As you can see below, these homes have an inventory of 6.1 months, and their median price is only 321k!

Date	2/09	3/09	4/09	5/09	6/09	7/09	8/09	9/09	10/09	11/09	12/09	1/10	2/10
For Sale	4961	4827	4689	4604	4406	4128	4045	3928	3726	3474	3175	3148	3256
New Listing	1398	1524	1512	1481	1457	1603	1406	1409	1307	1023	962	1361	1383
Sold	627	753	774	829	884	947	830	816	895	737	819	557	538
Pended	785	1054	1091	1031	1070	1101	1013	948	887	712	654	859	1141
Months of Inventory based on Closed Sales	7.9	6.4	6.1	5.6	5.0	4.4	4.9	4.8	4.2	4.7	3.9	5.7	6.1
Months of Inventory based on Pended Sales	6.3	4.6	4.3	4.5	4.1	3.7	4.0	4.1	4.2	4.9	4.9	3.7	2.9
Absorption Rate based on Closed Sales	12.6	15.6	16.5	18.0	20.1	22.9	20.5	20.8	24.0	21.2	25.8	17.7	16.5
Absorption Rate based on Pended Sales	15.8	21.8	23.3	22.4	24.3	26.7	25.0	24.1	23.8	20.5	20.6	27.3	35.0
Avg. Active Price	543	551	561	568	581	592	594	586	579	567	553	544	539
Avg. Sld Price	373	369	380	388	388	383	369	375	373	389	383	388	365
Avg. Sq. Ft. Price	150	149	150	154	156	154	150	152	149	152	149	149	145
Sold/List Diff. %	98	97	97	97	98	98	98	98	98	98	97	97	97
Sold/Orig LP Diff. %	91	91	91	92	92	92	93	93	93	92	92	91	93
Days on Market	67	71	71	65	65	64	58	63	64	65	71	78	69
Avg CDOM	90	97	102	89	94	88	81	84	82	86	93	99	93
Median Price	335	329	332	330	341	336	330	328	330	340	335	330	321

I took this portion of the market apart even more and did $100,000  and $250,000″traunches” for  a closer look of the inventory and days on the market of our upper median priced homes and into the Luxury Home prices here in the Sacramento area. More Surpises…

250-350k

Thes Homes are flying off the shelf

350-450k

Inventory really starting to slow down in this price range- over six months of inventory makes this the first pricerange that is truly a buyer’s maket!

Date	2/09	3/09	4/09	5/09	6/09	7/09	8/09	9/09	10/09	11/09	12/09	1/10	2/10
For Sale	1073	1061	1023	1021	1003	961	943	893	805	738	675	681	680
New Listing	347	364	369	371	367	390	337	334	294	232	225	355	306
Sold	162	190	199	214	225	199	210	191	233	186	195	133	113
Pended	196	253	284	253	254	259	234	246	224	162	165	209	260
Months of Inventory based on Closed Sales	6.6	5.6	5.1	4.8	4.5	4.8	4.5	4.7	3.5	4.0	3.5	5.1	6.0
Months of Inventory based on Pended Sales	5.5	4.2	3.6	4.0	3.9	3.7	4.0	3.6	3.6	4.6	4.1	3.3	2.6
Absorption Rate based on Closed Sales	15.1	17.9	19.5	21.0	22.4	20.7	22.3	21.4	28.9	25.2	28.9	19.5	16.6
Absorption Rate based on Pended Sales	18.3	23.8	27.8	24.8	25.3	27.0	24.8	27.5	27.8	22.0	24.4	30.7	38.2
Avg. Active Price	394	395	395	396	397	398	397	396	395	396	394	396	396
Avg. Sld Price	392	392	388	391	391	390	390	388	390	392	389	391	389
Avg. Sq. Ft. Price	154	149	151	154	158	159	147	151	149	149	145	154	147
Sold/List Diff. %	98	97	97	98	98	98	98	98	98	98	98	98	97
Sold/Orig LP Diff. %	90	92	92	92	93	93	95	94	93	95	93	94	95
Days on Market	76	70	73	67	66	62	50	71	69	53	69	84	67
Avg CDOM	98	93	99	88	94	87	62	89	90	74	83	105	111
Median Price	393	390	385	388	390	388	385	385	387	390	387	389	388

450-600K

It’s getting slower! And more painful! One of the most glaring satistics, and ond that would give some insight into the frustration these sellersare going through: in this pricerange, These homes are on the market for an aerage of 139 days and have a 9% sold price/original list price ratio- in this price range that’s $40,000 to $55,000 Lower than their original List price! And they waited over 4 and a half months to sell!

Date	2/09	3/09	4/09	5/09	6/09	7/09	8/09	9/09	10/09	11/09	12/09	1/10	2/10
For Sale	843	812	832	818	785	756	719	709	648	582	524	500	561
New Listing	220	216	260	227	220	231	207	212	198	138	117	208	212
Sold	87	80	86	93	129	152	94	100	103	100	114	60	57
Pended	99	127	142	143	147	146	131	113	118	105	74	106	135
Months of Inventory based on Closed Sales	9.7	10.2	9.7	8.8	6.1	5.0	7.6	7.1	6.3	5.8	4.6	8.3	9.8
Months of Inventory based on Pended Sales	8.5	6.4	5.9	5.7	5.3	5.2	5.5	6.3	5.5	5.5	7.1	4.7	4.2
Absorption Rate based on Closed Sales	10.3	9.9	10.3	11.4	16.4	20.1	13.1	14.1	15.9	17.2	21.8	12.0	10.2
Absorption Rate based on Pended Sales	11.7	15.6	17.1	17.5	18.7	19.3	18.2	15.9	18.2	18.0	14.1	21.2	24.1
Avg. Active Price	522	523	525	524	524	523	525	522	521	523	522	523	524
Avg. Sld Price	509	512	503	506	505	509	505	505	515	519	500	516	495
Avg. Sq. Ft. Price	158	164	161	168	171	165	167	172	159	163	170	157	151
Sold/List Diff. %	96	96	98	96	97	97	97	97	98	97	97	97	97
Sold/Orig LP Diff. %	88	90	91	90	91	92	91	92	95	89	90	93	91
Days on Market	78	73	84	77	84	75	81	67	61	87	86	69	98
Avg CDOM	96	92	108	104	114	92	124	101	84	109	116	85	139
Median Price	500	515	499	500	497	510	498	500	510	518	500	516	485

600-800k

Slowing even more… but definately still selling!

The Averae days on Mkt are all over the board, but these monsters are still selling great! these homes actually enjoy a hightr % (94%) retio of original active list price to sale price.

Date	2/09	3/09	4/09	5/09	6/09	7/09	8/09	9/09	10/09	11/09	12/09	1/10	2/10
For Sale	524	531	543	537	512	488	477	457	390	351	300	289	290
New Listing	106	117	141	120	120	124	95	88	63	69	46	77	87
Sold	16	36	44	46	44	57	29	41	43	36	35	34	20
Pended	38	54	52	60	64	60	39	47	51	34	21	34	54
Months of Inventory based on Closed Sales	32.8	14.8	12.3	11.7	11.6	8.6	16.4	11.1	9.1	9.8	8.6	8.5	14.5
Months of Inventory based on Pended Sales	13.8	9.8	10.4	9.0	8.0	8.1	12.2	9.7	7.6	10.3	14.3	8.5	5.4
Absorption Rate based on Closed Sales	3.1	6.8	8.1	8.6	8.6	11.7	6.1	9.0	11.0	10.3	11.7	11.8	6.9
Absorption Rate based on Pended Sales	7.3	10.2	9.6	11.2	12.5	12.3	8.2	10.3	13.1	9.7	7.0	11.8	18.6
Avg. Active Price	699	701	701	700	701	700	701	700	698	698	699	698	703
Avg. Sld Price	671	672	689	678	673	674	689	678	660	663	688	680	665
Avg. Sq. Ft. Price	196	193	191	192	194	193	198	176	186	186	182	178	173
Sold/List Diff. %	98	96	97	96	96	96	97	97	94	95	95	94	98
Sold/Orig LP Diff. %	87	88	85	89	92	89	85	92	88	85	89	88	94
Days on Market	76	92	100	96	84	70	119	75	81	126	87	133	61
Avg CDOM	88	131	163	140	131	121	199	126	111	152	109	186	102
Median Price	671	665	675	655	653	665	680	670	650	650	685	668	650

This is part of the Big Surprise!!  There are still lots of pople with money out there! and thet are buying Big Houses!!

These are 800k to 1 mil.

Why are these homes dead in the water? they are only 300koverth median price of teh last goup, yet they have 53 months if inventory!!

Date	2/09	3/09	4/09	5/09	6/09	7/09	8/09	9/09	10/09	11/09	12/09	1/10	2/10
For Sale	505	514	505	527	537	515	503	475	451	392	334	326	318
New Listing	88	115	79	96	89	85	62	60	62	35	26	57	56
Sold	7	10	11	16	16	15	12	13	8	16	12	11	6
Pended	9	26	26	18	26	21	17	20	18	18	11	13	24
Months of Inventory based on Closed Sales	72.1	51.4	45.9	32.9	33.6	34.3	41.9	36.5	56.4	24.5	27.8	29.6	53.0
Months of Inventory based on Pended Sales	56.1	19.8	19.4	29.3	20.7	24.5	29.6	23.8	25.1	21.8	30.4	25.1	13.3
Absorption Rate based on Closed Sales	1.4	1.9	2.2	3.0	3.0	2.9	2.4	2.7	1.8	4.1	3.6	3.4	1.9
Absorption Rate based on Pended Sales	1.8	5.1	5.1	3.4	4.8	4.1	3.4	4.2	4.0	4.6	3.3	4.0	7.5
Avg. Active Price	1580	1574	1586	1554	1566	1593	1602	1613	1606	1639	1638	1606	1638
Avg. Sld Price	1297	1098	1157	1321	1181	1067	1153	1181	1174	1149	1439	1229	1237
Avg. Sq. Ft. Price	272	235	254	270	230	218	261	233	224	256	239	234	229
Sold/List Diff. %	91	95	92	91	94	91	92	91	99	94	89	83	80
Sold/Orig LP Diff. %	80	84	81	88	87	80	80	83	85	86	81	64	68
Days on Market	80	92	77	62	65	127	129	87	98	81	128	197	233
Avg CDOM	221	149	177	96	78	182	287	176	115	135	330	221	260
Median Price	1150	1025	1027	1350	1100	1050	1045	1140	1095	1078	1138	1050	1120

Authored by Forth Hoyt | Discussion: No Comments »

Pending Home Sales Drop 7.6% Nationally, But Greatly Increase Sacramento Metro Market

March 5th, 2010 Categories: Sacramento RE Stats, Sacramento Real Estate Trends

 

 

Sacramento Real Estate Market Stats For January

All Sac Placer ED Counties All January Sales

 

 

 Sacramento Real Estate Pending Sales Are up 23%

It always happens this time year that pending sales start to increase, but what is so different about this year is the fact that available homes, or active listings have significantly reduced from last year.

The chart above goes a long way in explaining our market her in the Sacramento area and explaining the indset of the buyers we are working with.

Frustration that it is so hard to buy a home in a market that is so affordable.  The frustration actually comes becouse of all the inventory available, only about 20% of it is priced right and in a condition to be able to pass inspections and get a mortgage on it…

Who do you kow that is struggling with a mortgage right now?

Contact the Sacramento Short Sale Center for a Sacramento Short Sale Specialist at wereheretohelp.org

National Pending home sales drop 7.6%

According to the National Association of Realtors (NAR), its Pending Home Sales Index, a forward-looking indicator based on contracts signed in January, dropped 7.6% to 90.4 from a reading of 97.8 in December, and is 12.3% higher than January 2009 when it was 80.5. NAR said the harsh winter hampered home sales. “January pending sales, though still higher than one year ago, remain much lower than expected given that a large number of potential buyers are eligible for the expanded home buyer tax credit,” said NAR chief economistLawrence Yun. “Moreover, the abnormally severe and prolonged winter weather, which affected large regions of the US, hampered shopping activity in February.” Analysts say extension of tax credit is doing little to boost pending home sales, and given that the Federal Reserve will end purchase of mortgage backed securities this month, the housing recovery is going to take time. “When you take away all the support from the housing market, the und
erlying demand for housing is a lot weaker than we thought,” said Mark Vitner, an economist at Wells Fargo Securities. “We clearly pushed some demand forward, and there wasn’t that much demand to pull forward anyway. The housing recovery is going to be very, very slow.” On a regional basis, the pending home sales index dropped 8.7% to 71.3 in the Northeast, dropped 13.2% to 102.9 in the West, dropped 8.9% to 81.2 in the Midwest, and dropped 2.1% to 98.1 in the South.

 

Courtesy Chris Mcglaughlin

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CAR says 67 Percent of California Sellers Sold Becouse of Mortgage Woes

March 3rd, 2010 Categories: Real Estate News

California Association Of Realtors

C.A.R. releases “2009-2010 Survey of California Home Sellers”
Report finds 67 percent of California sellers sold their homes due to inability to meet mortgage obligation

LOS ANGELES (Feb. 25) –Changes in family and employment status as well as adjustments to monthly mortgage obligations played significant roles in California’s homeowners’ decisions to sell their homes in 2009, according to the CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.) “2009-2010 Survey of California Home Sellers.” According to the report, 67 percent of all sellers in California did so as a result of difficulties related to meeting their mortgage obligation.

“Tighter underwriting standards and a decline in equity continued to impact the market in 2009,” said C.A.R. President Steve Goddard. “Many homeowners chose to sell last year because their adjustable-rate mortgage reset at the same time home prices were experiencing an unprecedented decline, leaving them with little equity and difficulty in qualifying for a refinance.”
“Sellers responded to the challenges of the housing market in 2009 by choosing to work with REALTORS® for guidance and assistance in navigating the complex market,” added Goddard.

Recognizing the value of working with a real estate professional, 99 percent of sellers chose to work with a REALTOR®, according to the survey. Of those, 72 percent cited the ability of an agent to sell the home at a higher price point as the primary reason. Other reasons included better marketing and exposure (38 percent), while 28 percent reported it was too difficult to sell the home independently.

On average, homes sold for $20,958 less than the original asking price in 2009. The median difference between the selling and listing price was $32,315; the list-to-sold-price ratio was significantly larger between first-time sellers ($30,000 below list price) and sellers who had previously sold a home ($8,000 below list price).

The percentage of first-time sellers grew to nearly half of all sellers (44 percent) in 2009, a 33 percent increase from 2008, and nearly three times the 2007 percentage of 15 percent.

Sellers in 2009 cited difficulty meeting the monthly mortgage obligations (30 percent); job loss (18 percent); and “mortgage payment increased” (15 percent) as primary motivation to sell. By comparison, in 2008, one in five sellers cited the ability to meet their mortgage payment obligation; while 11 percent sold due to financial difficulties.

Financing challenges also extended to home buyers and impacted sellers’ confidence in buyers’ ability to secure a home loan. Nearly three-fourths of sellers reported this as a concern, an increase from 54 percent in 2008.

Financial difficulties also impacted the ability of sales to close on time, with 63 percent of homes falling out of escrow prior to closing. Nearly 70 percent of sellers cited “buyer could not get an acceptable mortgage;” and more than 60 percent said “buyer backed out,” as the primary reasons the home fell out of escrow. Other reasons included: Buyer’s remorse (26 percent); “lender withdrew and did not fund” (24 percent); and “home prices continued to decline” (18 percent). Once the home did sell, 50 percent of sellers reported escrow did not close on time in 2009, compared with 36 percent in 2008.

C.A.R.’s “2009-2010 Survey of California Home Sellers” is available for purchase for $49.95 in electronic format at http://www.rebsonline.com/product/1311/2009-Survey-of-California-Home-Sellers-%28PDF-Electronic-Download%29. The survey no longer is available in hard-copy format. Journalists who would like a complimentary copy of the report should e-mail markg@car.org or call (213) 739-8363.

Leading the way…® in California real estate for more than 100 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States, with nearly 175,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

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Buffett Says U.S. Housing Will Recover by Next Year

March 3rd, 2010 Categories: Uncategorized

 

 Although his view is nationally, and not locally, Warren Buffett is usually not too far off when it comes to projecting economic cycles- Came across this great article from Business Week and thought I would share it here…

March 1 (Bloomberg) — Billionaire Warren Buffett said the U.S. residential real estate slump will end by about 2011, predicting that’s how long it will take demand for homes to catch up with the supply.

“Within a year or so, residential housing problems should largely be behind us,” Buffett wrote Feb. 27 in his annual letter to shareholders of his Berkshire Hathaway Inc. “Prices will remain far below ‘bubble’ levels, of course, but for every seller or lender hurt by this there will be a buyer who benefits.”

The worst housing decline since the Great Depression has left one in five U.S. mortgage holders owing more than their houses are worth. Record foreclosures last year flooded a real estate market already glutted with unsold property, causing new construction to fall to the lowest in at least 50 years. The fall in homebuilding is the only fix unless the U.S. decides to “blow up a lot of houses,” Buffett joked.

“People thought it was good news a few years back when housing starts — the supply side of the picture — were running about two million annually,” said Buffett, the chairman and chief executive officer of Omaha, Nebraska-based Berkshire. “But household formations — the demand side –only amounted to about 1.2 million.”

Berkshire, which owns a real-estate brokerage, a business that constructs pre-fabricated houses and units that make products used in homebuilding, has suffered amid the slump. Profit at Clayton Homes, the pre-fab housing business, fell about 9 percent to $187 million before taxes, while earnings at carpet manufacturer Shaw Industries fell 30 percent.

‘Deeply Invested’

“High-value houses and those in certain localities where overbuilding was particularly egregious” will take longer to recover, he wrote.

“He’s very deeply invested in this,” said Tom Russo, partner at Gardner Russo & Gardner, which holds Berkshire stock. “Across his industrial companies, he’s massively poised to gain” from a housing recovery, Russo said.

Buffett joked that curbing home construction was the best of three ways to reduce supply. The other two, he said, would be to explode homes in a “tactic similar to the destruction of autos that occurred with the ‘cash-for-clunkers’ program” or “speed up householder formations by, say, encouraging teenagers to cohabitate, a program not likely to suffer from a lack of volunteers.”

Baseball, Wall Street

Buffett’s annual communications with shareholders have won him a following of professional money managers and the moniker “the Oracle of Omaha.” He’s written passages in past years that compare investing to baseball, derivatives to venereal disease, and Wall Street bankers to Pied Pipers. The letters have been compiled into a book for those who want to study his pronouncements.

Buffett, 79, built Berkshire into a $198 billion company through investments in firms he believes have superior management and lasting competitive advantages. His deals transformed Berkshire from a failing textile mill into an enterprise that makes candy, produces power and sells flight time on private jets. The shares traded at about $15 when he took control in 1965; the Class A stock last closed at $119,800.

Still, he and Vice Chairman Charlie Munger passed up opportunities when they weren’t able to evaluate the future of a business, even in a compelling industry, he said. That strategy has allowed the company to perform better than the benchmark Standard & Poor’s 500 in every year when both Berkshire and the index have fallen.

Playing Defense

“In other words, our defense has been better than our offense,” Buffett wrote. Last year, he said, Berkshire should have made more purchases of corporate and municipal bonds because they were “ridiculously cheap” when compared with U.S. Treasuries.

“When it’s raining gold, reach for a bucket, not a thimble,” he said. Corporate bonds returned 26 percent in 2009, compared with negative 11 percent in 2008, according to data compiled by Bank of America Corp. Merrill Lynch. State and local government bonds yielded 14 percent last year, compared with negative 4 percent in 2008.

Berkshire did extend financing to companies including Goldman Sachs Group Inc., General Electric Co. and Dow Chemical Co. during the credit crisis as other investors were withholding funds. The private deals pay dividends and interest of $2.1 billion annually, Berkshire said in a filing disclosing 2009 results. Berkshire’s net income of $8.06 billion rose 61 percent from 2008.

‘Climate of Fear’

“We’ve put a lot of money to work during the chaos of the last two years,” Buffett wrote. “It’s been an ideal period for investors: A climate of fear is their best friend. Those who invest only when commentators are upbeat end up paying a heavy price for meaningless reassurance.”

Buffett has used past letters to discuss plans for his successor, praise Berkshire managers and confess his failings. He admitted this year to a “very expensive business fiasco” with his move to issue credit cards to policyholders at his company’s Geico Corp. auto-insurance subsidiary. Last year, he said the U.S. economy was “in shambles” after reckless lending caused the worst financial “freefall” he ever saw.

He chastised the media in the new letter for “terrible journalism” in seizing on that comment from the prior year without also reporting that he made no predictions about the direction of the stock market.

CEO Responsibility

Buffett said this year that the CEOs and boards of companies that failed during the credit crisis shouldn’t be allowed to pass blame to underlings. Boards should insist on CEOs taking full responsibility for the risk of collapse, he said. “If he’s incapable of handling that job, he should look for other employment,” Buffett wrote.

Shareholders weren’t responsible for the botched operations at some of the country’s largest financial institutions, Buffett said, “yet they have borne the burden with 90 percent or more” of their holdings wiped out in cases of failure.

Still, he said, using year-to-year stock prices to evaluate a company’s progress can be an “extraordinarily erratic” measure. Even a decade can fail to give the proper picture, as Microsoft Corp. CEO Steve Ballmer and GE’s Jeffrey Immelt found when they took over with their shares at “nosebleed” prices.

Immelt, Ballmer

GE shares have dropped about 60 percent since Immelt took over in September 2001; Microsoft has fallen about 47 percent under Ballmer’s tenure. Berkshire shares have risen more than 160 percent in the past decade, compared with the 17 percent decline in the S&P 500. Buffett’s company joined that index last month when it completed the largest deal of his 40-year tenure, the $27 billion takeover of railroad Burlington Northern Santa Fe Corp.

Berkshire owned about 23 percent of the railroad’s stock before the acquisition, and will book a first-quarter gain of about $1.1 billion tied to the increase in the value of those shares on the takeover, the company said.

Berkshire had $30.6 billion in cash and so-called near cash like U.S. Treasuries as of Dec. 31, compared with $26.9 billion three months earlier, after Buffett sold stock to add to the company’s cash cushion in advance of the rail deal. Buffett used about $8 billion of that cash to help fund the acquisition.

“We pay a steep price to maintain our premier financial strength,” Buffett wrote. “The $20 billion-plus of cash- equivalent assets that we customarily hold is earning a pittance at present. But we sleep well.”

–With assistance from Jamie McGee, Hugh Son and Rick Levinson in New York. Editors: Erik Holm, Dan Reichl.

To contact the reporter on this story: Andrew Frye in New York at afrye@bloomberg.net.

To contact the editor responsible for this story: Dan Kraut at dkraut2@bloomberg.net.

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Sacramento Real Estate: Loan Mods Would Stop Many Sacramento Foreclosures

March 1st, 2010 Categories: Foreclosure News

The loan mod question:  What’s wrong with this picture? Why aren’t they working?

 I talk to families all the time who are struggling making payments on a home here in our Sacramento area that may be  30, 40, maybe even 50%  or more upside-down… inevitably, they ask “instead of making us foreclose or do a short sale; why wont the the bank just ‘re-sell’ it to us and let us stay here?”

That would come in the form of a loan modification or a short refinance…

Most of the time, the homeowners have either already tried to do a loan modification and could not qualify, or actually have qualified, gone through the 90 day HAMP trial program and received a final long term modification offer from the servicer that just didn’t make sense.

One lady last week, had a loan dification where the payment INCREASED $180.00 per month!

So what is really going on here? Why the heck wouldn’t the bank, servicer, investor and everyone involved just get with the program and help these people?

 Good question.  

Makes absolute sense. 

I have wondered that for a couple of years now myself, and thought I had a good answer for that; I was under the impression it had something to do with  the fact that the investor or note holder or owner of the mortgage would rather have a big influx of cash, and have the opportunity to go re-invest somewhere else. (*yeah, but where?)

For instance, instead of agreeing to write off  $100,000 and also agree to a new loan from the existing home owner for a subsequently lower monthly payment, the note owner would rather get a big influx of cash by doing a short sale or foreclosure and go invest what’s left of his money somewhere else.  I mean; why else would they be disallowing and not providing more loan modifications for good, creditworthy and very qualified homeowners. Most of these people have just had a reduction in income; by furlough days, reduction in overtime etc. and are just struggling… just having a hard time making a payment that is two or three times the amount of rent they would be paying to rent the same house.

These people are still good credit risks, still making payments, just absolutely struggling and looking for help; with today’s standards though, they need to get behind on payments usually in order to do a loan mod or be approved for a short sale…

In my daily reading I came across this great article by Ocwen’s Paul A. Koches.  Mr. Koches is Executive Vice President and General Counsel of Ocwen since May 2008. Koches oversees the legal affairs of the company as well as its government, community, and media relations.

In the article, Mr.Koches talks about The National Consumer Law Center and their October report, “Why Servicers Foreclose When They Should Modify and Other Puzzles of Servicer Behavior: Servicer Compensation and Its ConsequencesI have included the entire text here but also a link to DSNews.

No Matter How Ocwen Looks at It, Loan Modifications Are Better Business for Servicers Than Foreclosures

The National Consumer Law Center (NCLC), Inc., is an effective, concerned organization that works to advance justice and fair treatment for consumers, especially those who are economically disadvantaged.

So it is natural—and, of course, very helpful—that NCLC has been researching the mortgage crisis and speaking out on behalf of homeowners. Recently, NCLC explored important and troubling questions. If mortgage modifications—now advocated and incentivized by the Obama administration—are the key solution to the crisis, why have relatively few occurred, and at a slow pace, while foreclosures continue at an unprecedented, damaging clip?

NCLC’s October report, “Why Servicers Foreclose When They Should Modify and Other Puzzles of Servicer Behavior: Servicer Compensation and Its Consequences,” underscores some important points:

- The pace of loan modifications by the servicing industry is generally too slow;

- The national foreclosure rate is still way too high; and

- Any successful attempts to redress the foreclosure crisis will, of necessity, involve loan modifications.

INCORRECT TO THE CORE

In exploring the conundrum of high foreclosure rates and relatively sluggish modification rates, the NCLC report takes loan servicers to task. That’s certainly a reasonable approach as servicers are the entities responsible for modifications. The NCLC analysis of servicers, however, is based on some incorrect core assumptions. It says servicersmake more money with foreclosures, so therefore, they have no real financial incentive to pursue sustainable, lasting modifications.

That simply isn’t true. Servicers rarely, if ever, make money when there’s a foreclosure. They’re expensive, time consuming, and draining. REO, in this real estate market, just isn’t a good business. On the other hand, modifications are good business—and make financial sense for servicers—when they’re done prudently and carefully. The fact is, in most cases, a modified loan, even one in which the principal has been adjusted, generates more income for a servicer than a foreclosure.

OPERATIONS NOT UP TO SPEED

Perhaps the real reason for the generally slow start to modifications is more operational than financial. Servicers, at this time, simply do not have sufficient know-how, capacity, and experience to communicate withtheir customers to design and effect sustainable modifications on scale with the problem—and they’re not turning to the outside resources that do have the platform and capacity to help.

It’s worth noting that at Ocwen modifications are a key part of the business and operational strategy, and the company has led the industry in the rate of permanent modifications under the Home Affordable Modification Program (HAMP). Ocwenis in this position because it has traditionally worked almost exclusively with high-risk—i.e., subprime—loans and has invested $150 million in R&D for scalable loss mitigation technology and analytics to accommodate significant numbers of modifications. Major players are recognizing Ocwen’s capabilities and are increasingly turning to it to reduce delinquencies and losses and for modification assistance. Recently, large financial institutions have sent Ocwen approximately $15 billion in their mortgages for special servicing and rehabilitation.

Ocwen believes that modifications are good for investors, good business for its company, good for distressed homeowners, good for communities, and good for the housing market overall. Doing good is, more often than not, good business.

FORECLOSURES NOT WALLET-FRIENDLY

The first misguided assumption on NCLC’s part is that servicers usually make money on foreclosures. The reality is that servicers make money when delinquent loans become reperforming. Servicers collect the most servicing fees and incur the lowest costs when this is the case. Foreclosures, in contrast, are costly—and it is simply not true that the servicer always recovers its expenses in foreclosures. Foreclosure is not only a tragedy for a homeowner, but given the all-time-high loss severity rates in the current market, it’s a major loss as well for loan investors (i.e., the owners of the loans). Servicers doing their jobs properly will and should seek alternatives such as modifications to mitigate losses for their clients.

The NCLC grossly underestimates the impact of the loss of monthly servicing fees when there’s a foreclosure. Those fees, which resume when there’s a sustainable modification, are really the lifeblood of a servicing business. Losing them, in an environment where there are no new mortgage securitizations on which to bid for servicing rights, is damaging.

Similarly, NCLC trivializes the servicer incentive and success fees provided for permanent modifications pursuant to the government’s HAMP program. The NCLC report asserts these fees aren’t enough to induce servicers to modify, but the reality is these additional incentives are meaningful and revenue-generating.

Finally, NCLC advances the incorrect perception that servicers do well by shunning modifications because they make a lot of money from late fees. That just isn’t true. The reality is that late fees, which are rarely collected in a foreclosure-bound situation, don’t come close to covering the cost of financing advances that servicers must make to investors in case of delinquent loans.

A WINNING HAND

Now for the real story: The bottom line at many servicing shops, including Ocwen, is that the overriding financial incentive comes from adhering to contractual obligations to service the loans, and resolve delinquencies, in the best interest of the investors. So, when a servicer’s metrics indicate a higher investor net present value for a modification than a foreclosure—which is often the case in this environment—the servicer is required to modify the loan.

In short, the financial cards are not stacked against modifications arranged by servicers.

So where is the disconnect? Why are modifications happening so slowly in the industry?

PRE-EXISTING CONDITIONS

The root cause is not insufficient servicer incentives; it is instead the pre-existing shortage of industry infrastructure and capacity combined with the time lag needed to effectively expand the same. The real call to action should be for the industry to redouble its effort to ramp up in terms of technology, know-how, and analytics—or at a minimum to find the right modification partners who can help support the effort.

Anticipating an uptick in delinquencies, Ocwen beefed up its loss mitigation staff by 50 percent in 2007. No one, however, could have predicted the tsunami wave of defaults that was about to hit.

At the same time, many large banks had diversified their traditional prime loan origination business by expanding into subprime lending and servicing, often through acquisitions. But successfully integrating a subprimemortgage operation into a prime culture is difficult—they are entirely different worlds. Prime delinquency and foreclosure rates have always been a small fraction of subprime’s; servicing the latter effectively requires many more “high-touch” processes and procedures. It’s not surprising, then, that the big banks were overwhelmed with the unprecedented spikes in subprime delinquencies brought on by the mortgage crisis and continue to struggle to prevent foreclosures even now.

SUSTAINABILITY AND SCALABILITY ARE KEY

Even with the advantage of decades of subprime servicing experience and specialized technology, Ocwen was scrambling at the outset of the mortgage crisis to get defaults in its portfolio under control. Ocwen increased staff by another 30 percent in early 2008. More important, Ocwen decided its basic loss mitigation approach needed to be elevated to the next level—and fast. The forbearance plans and the other techniques that enabled the company to lead the industry in containing losses by avoiding foreclosures would no longer be enough. Nonperforming loans now needed to be fundamentally re-underwritten if there would be any hope of arresting delinquencies.

Ocwenknew full well, however, that the success of any loan modification program would be measured on two essential metrics. It would need to be both sustainable in providing reduced monthly payments that homeowners can truly afford and to which they will commit long term, as well as sufficiently scalable to meet the high number of homeowners in distress. Of course, as a third-party servicer, Ocwen also needed to ensure that its modifications were NPV positive for the owner trusts.

So from the outset of the pre-HAMP modification program, and now under HAMP, Ocwen has been working hard to make modifications stick. Ocwen’s technology utilizes advanced optimization models t0 evaluate the best resolution alternatives. Ocwenalso provides one-on-one financial counseling to the homeowner, aided by interactive scripting engines incorporating behavioral science research for more effective communication with distressed borrowers and more lasting resolutions.

PICKING THE RIGHT PEOPLE PAYS OFF

Ocwen’s behavioral science department has also confirmed—through research, testing, and six sigma analytics—the optimal personality traits and cognitive ability to guide the successful hiring and training of its customer care staff. With these tools, Ocwen can bring on high-performing home retention consultants in 90 days or less. Psychology has thus become an integral part of an overall loss mitigation technology platform that is robust, scaleable, and enables Ocwen not only to cure and control delinquencies in its own portfolio, but also to ramp up quickly to deploy additional capacity for third parties.

The effort and investment are paying off. Ocwen modifications’ re-default rate of 25 percent is far lower than the industry average of 50 percent, as reported by the OCC/OTS. According to a mid-2009 Bank of America Mortgage Credit Research Report, Ocwen has the highest industry average of modifying fixed-rate and adjustable-rate subprime mortgages more than 90 days’ delinquent into current, performing loans.

The Ocwen approach has been especially effective within the Treasury Department program. As noted by Professor Alan White, oft-quoted expert on foreclosure prevention and the HAMP program, “Ocwen . . . has converted 89 percent of borrowers who were on temporary modifications in August to permanent mods by November,” while the conversion rate for large banks for the same period ranged from 11 percent to fewer than 1 percent. Ocwen’s pull through of permanent modifications continues to outpace industry by a wide margin according to Treasury’s most recent monthly HAMP report card.

TIGHTENING COMMUNITY TIES

In addition to raising the bar on analytics, capacity, and technology, there are other ways to add scale and sustainability in the servicer-based loan modification process. One is for servicersto work closely withcommunity groups. They can help reach out to distressed homeowners and help them stabilize their finances and communicate with servicers in candid, productive ways. Community and grassroots groups are also good brainstorm partners and allies for servicers when it’s time to call for government action.

Ocwen recently convened more than 30 representatives of grassroots and national housing advocacy organizations for a roundtable discussion to share new ideas and insights related to preventing foreclosures and helping homeowners. The Ocwen and community group representatives agreed upon a number of imperatives that could streamline and accelerate the loan modification drive. The imperatives include:

- Working closely with Treasury to arrive at more flexible guidelines, so more distressed homeowners qualify for mortgage modifications under HAMP;

- Developing a national HAMP awareness and information campaign to increase homeowner outreach;

- Focusing more intensely on homeowners who are unemployed or under-employed and thus need state or federal assistance to qualify for mortgage modifications; and

- Encouraging greater collaboration between servicers and grassroots groups in providing real-time solutions for homeowners, including being more proactive about helping borrowers early on, before they face the prospect of foreclosure.

The National Consumer Law Center underscored an important issue by looking into why foreclosures continue at too rapid a rate and why the loan modification movement seems slow in taking hold. Contrary to its thesis, however, financial incentives do not favor foreclosures over modifications. Modifications, in this environment, are actually good for the servicing business, as well as good for homeowners, communities, and the property market. But servicers must do their part to build the capacity and expertise—or look outside for help.

About the Author:
Paul A. Koches is EVP, general counsel, and secretary of Ocwen Financial Corporation. Koches oversees the legal affairs of the company as well as its government, community, and media relations. Prior to joining Ocwen in 2002, Koches practiced law in Washington, D.C., for over 20 years, most recently as a partner in Arent Fox, LLP. To learn more about Ocwen Financial Corporation, please visit Ocwen.com

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