Archive for the 'Loan Modification' Category
National Mortgage Delinquency Rate Now Surpasses 10%
February 5th, 2010 Categories: Default News, Loan Modification, Real Estate Trends, Sacramento Foreclosure News
Contributed by Wereheretohelp.org
Sacramento Foreclosure Specialist Reports:
Foreclosures Will Continue
I was Researching Sacramento area HAMP loan mod success rates this nmorning and came across this startling article in DSNews. It looks as if all the good news the Obama powered media has been pumping out is a little off center. Kinda Scary!
Home loan delinquency rates in the United States have now surpassed 10 percent, Lender Processing Services (LPS) reported this week.When you factor in homes already in the foreclosure process, the total rate of noncurrent mortgages sits at 13.3 percent, according to the data in the Florida-based company’s national loan-level database.This rate indicates that more than 7.2 million mortgage loans are now behind on payments, LPS explained, with another one million properties already taken back by banks and in REO status.LPS’ January 2010 Mortgage Monitor report, shows that within the population of loans that were current at the end of 2008, the percent of “new” serious delinquencies is 4.64 percent – higher than any other year analyzed. Of loans that were current as of December 31, 2008, by December 2009 there were 2.3 million new loans that were considered seriously delinquent.
Contact us today… Sacramento Short Sale Help can snswer your questions.
Seemingly less-risky, prime mortgages continue to loom large as the industry’s big, pink elephant. Prime loans, including agency, non-agency, and jumbo, have experienced deterioration at a worse pace than subprime, Federal Housing Administration (FHA) insured mortgages, and all loans as a whole, LPS said. The company’s analysis shows that within the prime loans category, those with unpaid principal balances between $417,000 and $600,000 have performed the worst. The Mortgage Monitor report also indicates that 2009 vintage loans are performing better than loans from any of the prior five years and have been steadily improving as pools of loans grow larger. This improvement is attributed to more restrictive underwriting guidelines, but that also means “liquidity is still not available where it is needed most,” LPS said.The company’s analysis shows that states with most noncurrent loans are: Florida, Nevada, Mississippi, Arizona, Georgia, California, Indiana, Michigan, Illinois, and Ohio.Those with the fewest include: North Dakota, South Dakota, Alaska, Wyoming, Montana, Nebraska, Vermont, Colorado, Oregon, and Washington.
More Questions? Sacramento Short Sale Help is here when you need us!
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Folsom Short Sales Will Become Even More Popular in Some Neighborhoods
December 29th, 2009 Categories: Default News, Loan Modification, National Real Estate Trends
Folsom Short Sales will definately be more popular in some Neighborhoods. Folsom homes that were built and sold in 2005 and 2006 will probably be where you are going to see the most short sales in Folsom.
You see, new home builders used negative am, Adjustable rate Mortgages and Pick-a-pay programs to get the most money possible for their homes. These artificially low payments allowed buyers who could normally not afford these larger homes buy them.
Now, amidst a huge market value decline and the worst economy in decades, those loans are coming unlocked.
Most of these homeowners will qualify for some type of loan modification program, may at least get the adjustable rate changed to a fixed. Some will have to extend the mortgage out to 40 or 45 years, because most secondary investors who own the note are not interested in any kind of principle reduction.
Many will go into the new HAMP program, a ninety day trial modification where after a successful trial period the homeowner applies for a long term modification. The short sale will be the best solution for those who do not qualify or choose not to do a modification.
The administration is urging participating servicers to follow through with short sales as an alternative to foreclosure for those homeowners that don’t qualify for a reworked mortgage under the Home Affordable Modification Program (HAMP).
Under the terms of the new program, once a servicer determines a homeowner does not qualify for a modification, the servicer has a 30-day window in which the borrower must be considered for the HAFA program. Each participating servicer is required to develop a written policy, consistent with investor guidelines, that describes the basis on which the servicer will offer the HAFA program to borrowers
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The Rise of The Sacramento Short Sale
December 22nd, 2009 Categories: Default News, Loan Modification, Real Estate News, Sacramento Real Estate Trends, Shortsales
Sacramento Foreclosure Solutions Expert Report
Sacramento Short Sales now 21.5% of Market
Well First of all, Let’s just quickly define short sales:
A real estate short sale is a sale of property in which the sale proceeds fall short of the balance owed on the property’s loan or loans.
Sacramento’s Real Estate Market has recently been a perfect storm for short sales.
There have always been short-sales. Since the beginning of real estate. Market prices go up and market prices go down, and when a homeowner has to sell when they are upside-down… well, you get the picture.
Homeowners can have many reasons to sell their home in a Short Sale; any time there is a reduction in market value along with the need for relocation, sickness, job loss, death or divorce, there is no other way besides just letting the bank take it back. So Short Sales are the best solution to keep a homeowner out of foreclosure when it is clear they cannot keep the home…
But in this economy, Sacramento shortsales most often occur when a homeowner just cannot pay the loan payment on their property. With Sacramento unemployment at 12.3% and a 41 month long drop in median home prices that has taken over 55% off the 2005 highs in Sacramento County. Sacramento Short Sales are now over 20% of the market!
Short sales in Sacramento have become a popular pre-foreclosure option to keep homeowners out of foreclousure, when loan modifications just don’t provide a solution to foreclosure.
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Struggling Homeowners: 4% Get Mortgage Help
December 11th, 2009 Categories: Default News, Loan Modification, Real Estate News, Real Estate Trends, Shortsales
This just in from Chris McLaughin:
Treasury officials, in the first comprehensive tally of permanent modifications made, say that loan servicers have converted 31,382 people from trial adjustments to long-term assistance as of Nov. 30, but 30,650 people in trial modifications have been denied. That means that only about 4% of troubled borrowers have received long-term help under the Obama administration’s foreclosure prevention program. A nearly equal number of trial modifications have been denied permanent assistance, the report showed. The reasons include not making monthly payments on time, not submitting all the necessary paperwork and not qualifying for reasons such as insufficient income.
Homeowners claim that banks keep losing paperwork, but banks claim they often don’t get it in the first place. Around 375,000 people should be eligible to receive long-term relief by year’s end, but only one-third of homeowners who have made at least three trial payments have submitted all the needed forms, Treasury officials say, and some 20% have not submitted any paperwork at all. Banks and government agencies have hired outside companies to knock on borrowers’ doors to assist them with completing the paperwork. None of this addresses the real problems, of course: a lot of people are underwater and don’t see the point of making payments, and quite a few know they won’t qualify once their real income comes to light.
Along the same lines is This Article From DSNews:
Treasury released the highly-anticipated progress report on the government’s foreclosure prevention program Thursday afternoon – which for the first time includes details on the number of trial modifications each servicer has converted to permanent status – and as lenders warned earlier this week, the results were disappointing.
Of the more than 728,000 Home Affordable Modification Program (HAMP) trials under way across the country, 375,000 are scheduled to convert to a permanent modification by the end of the year, and only 31,382 have made the transition.
The Treasury Department said in a statement to the press, “According to servicer reports, most borrowers in modifications are meeting their responsibilities to make their payments. Servicers need to do their part to help borrowers complete the process and get to the finish line.”
A number of servicers have told DS News that the problem lies in the paperwork. They say an unsettling number of borrowers just don’t submit the required documentation for conversion once they complete the trial phase, or file incomplete or inaccurate information. Participating servicers say they’re ramping up outreach efforts to ensure homeowners who’ve successfully completed their trial phase get the necessary documents in for permanent assistance.
Molly Sheehan, SVP of housing policy for JPMorgan Chase’s home lending division told a congressional panel earlier this week that the focus of her group’s “immediate attention is finding ways to assist the 51 borrowers out of 100 that are missing some or all of the documentation.”
But on the other end of the process, homeowners and their advocates say it’s the servicers and their staff that cause the delays, and in some cases, even lose the paperwork.
Julia Gordon, senior policy counsel for the Center for Responsible Lending, testified to lawmakers Tuesday that servicers still lack the capacity to effectively administer a program of HAMP’s size and scope. It’s been nine months since HAMP began, and Gordon said, “Homeowners still have terrible trouble reaching their servicers, and when they do, they often encounter staff who are ignorant of the HAMP program, they sit through attempts to steer them into other products, and they are unable to get any firm decisions made in a timely manner.”
Timra Valentyne, a loan officer with United Homestead tells DSNews.com that she’s encountered similar problems helping homeowners work with their servicers on HAMP modifications. On numerous occasions, Valentyne said, the borrowers’ documentation gets lost in the shuffle or never gets tagged for the appropriate account.
She cited a particular case with Chase, in which the homeowner had successfully made his restructured payments through five months of a HAMP trial, but was denied a permanent modification because he cashed in a certificate of deposit (CD) to help cover the new payments and the bank ruled his hardship was only temporary. When Valentyne followed up with Chase, the bank representative told her the homeowner was never on the HAMP plan, although the homeowner had a rejection letter stating that he’d been denied for the “Making Home Affordable” modification program – a clear discrepancy in records and paperwork.
Gordon advocates requiring HAMP-participating lenders who are producing insufficient results to use specialty servicers working for the government to handle certain accounts. These companies specialize in intensive, “high-touch” approaches to working with homeowners in trouble, she says, and are much more effective at reaching borrowers than a mainstream servicer.
One specialty servicer says it’s exactly this type of high-touch method that has led to its HAMP success. Ocwen Financial has converted an industry-leading 74 percent of its trial mortgage modifications to permanent status. The Treasury’s latest HAMP report shows that Ocwen accounts for a disproportionately high 13.5 percent of all permanent modifications completed to date even though it services only 2 percent of the estimated HAMP-eligible loans.
Ocwen says its partnerships with homeowner advocacy groups have been indispensible in helping the company keep borrowers active in the process. Ocwen collaborates with a range of independent housing advocacy and grassroots organizations to reach out to homeowners and to help them gather the required documents for a modification.
Based on the December HAMP report GMAC Mortgage is having the most success with permanent modifications in terms of sheer numbers. GMAC has successfully made the conversion for 7,111 homeowners. The company has extended trials to 39 percent of its eligible borrowers.
Bank of America had the worst showing of all the largest lenders. It has finalized a mere 98 permanent modifications, and has extended trial offers to only 15 percent of its more than a million eligible homeowners.
The administration recently announced a new push to compel servicers to complete more permanent modifications, threatening to impose fines, withhold cash incentives, and publicly name those companies that fail to perform up to par
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Luxury Short Sale Homes Are on the Horizon!
December 4th, 2009 Categories: Default News, Loan Modification, Mortgage and Loans, National Real Estate Trends, Real Estate News, Shortsales
…The Coming ARM Storm
First it was the sub-prime market and now experts agree, adjustable rate mortgages combined with rising unemployment and falling property values could create another economic storm capable of ravaging the weak economic recovery. Here’s a quick breakdown of the ARM Storm-Tracker for those savvy short sale investors to beginning their planning:
Resetting Rates: Current interest rates are at or near historic lows with 30 year fixed mortgages below 5 percent while ARM’s are likely to readjust and drive the cost of monthly mortgage payments to double their former payments. Unfortunately, many current ARM holders do not qualify for refinancing due to changes in employment status, high loan to value ratios and increased debt to income percentages.
Evaporating Equity: Not only did millions of Americans take out Adjustable rate mortgages but they built additions and over-improved their homes based upon loans. As home values fell, so did the equity reserves required to refinance their ARM mortgages. Whether it was a first mortgage with minimal down payment or a second (and even third) mortgage, lower property values have all but erased excess equity from a large number of buyers.
Cheaper to Walk: Many homeowners are finding it less expensive to simply walk away from rapidly rising mortgage, rent for awhile then repurchase. According to industry experts, a significant number of homeowners are capable of making the mortgage payment but simply don’t desire to do so given the cost of purchasing the same home after foreclosure. Current homeowners are eligible for FHA loans in as few as three years after default – creating an inverse incentive to continuing paying on a property worth tens (or even hundreds) of thousands dollars less than the existing mortgage.
Renting an Increased Option: Throughout the nation lenders are getting creative in order to reduce the inflow of defaulting properties on their portfolio; one of the more popular options among existing homeowners is the ability to rent your current property for a specified period of time.
ReFi with an ARM? It’s true, the FHA has a 3.87 five year adjustable rate mortgage option designed to help keep payments affordable. Unfortunately, it may simply delay the pain until interest rates continue to rise later. However, with a 2 percent cap on each adjustment/rate increase, it could conceivably buy time for those in unusual short term situations such as temporary illness, job loss of other large expenses. It also has the benefit of “buying time” for the banks and lenders who are in no hurry to acquire even more properties given the current backlog of non-performing properties in their portfolio.
What is a savvy short sale investor to do? Get ready for the coming wave of ARM properties to hit the market. Be sure your credit is in place and position yourself to solve problems for both homeowners and lenders in need of a new start.
See you at the top!
Another article courtesy Chris McLaughlin
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Bank Of America As Second Lienholder… Is $3,000.00 Enough?
December 3rd, 2009 Categories: Default News, Loan Modification, Mortgage and Loans, Real Estate News, Shortsales
There are so many home retention/foreclosure avoidance programs with acronyms now, it’s hared to keep them all strait…
There’s the MHA program , the HAMP program, the HFHA program, the NPV test, the HARP program, the HAFA program and now, the newest acronym and finally one that might make some difference for homeowners who need to sell; the HAFFAP program or Home Affordable Foreclosure Alternatives Program.
An article from DSNews included thisbreakdown of the program:
To entice servicers to accept a sale on defaulted properties for less than the outstanding mortgage balance, Treasury is offering incentive payments of $1,000 per completed short sale. Servicers will also receive $1,000 for each deed-in-lieu of foreclosure.
Subordinate lien holders will be paid to release their claims on defaulted properties, up to $3,000 of the short sale proceeds as long as the primary investor agrees to share the earnings, and for this concession, the investor will also receive up to $1,000 from the Treasury. For those second lien holders who want more than the $3,000 cap to relinquish their stakes, the Treasury said they can pursue a short sale outside of the federal program.
Homeowners who agree to a short sale or deed-in-lieu of foreclosure will get up to $1,500 to help with relocation, and must be “fully released” from any future liability, according to the guidelines.
The Home Affordable Foreclosure Alternatives Program (HAFA), as it is being called by the Treasury, was initially announced back in May, but was delayed because of concerns over legalities involved in the process and the rights of second lien holders to hold claim over the property. DSNews.com reported in October that the administration was readying guidelines for the program, and yesterday, they arrived.
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Sacramento Hearing Addresses Foreclosure Crisis in California
November 19th, 2009 Categories: Default News, Foreclosure Rescue Scams, Loan Modification, Pre Foreclosures, Shortsales
SACRAMENTO /California Newswire/ — Assemblymember Pedro Nava (D-Santa Barbra), Chair of the Assembly Banking & Finance Committee, led the second in a series of informational hearings today to examine California’s foreclosure crisis, the state’s current loan modification programs, and methods by which the state could improve procedures to help struggling California homeowners. Nava was joined by Nevada Assembly Speaker Barbara Buckley, housing experts, representatives from the banking and mortgage industry, and state and local non-profit housing and consumer organizations.
“This crisis has devastated thousands of California families and communities. It’s time to take a new approach to help families remain in their homes. Today’s hearing provided more evidence that our existing loan modification programs have been ineffective and the number of families benefiting from them is minimal,” said Assemblymember Nava. “I will continue to work with all the stakeholders who testified today to come up with viable and effective solutions, including the establishment of a loan mediation program.”
California continues to have the third highest foreclosure rate in the nation, with one in every 144 homes in some stage of the foreclosure process. While these numbers have decreased from last year, 400,000 were nonetheless foreclosed on in California in 2009. Thus far, federal and state efforts to encourage banks and servicers to modify borrowers’ loans have largely been on a voluntary basis, and those who need help are subsequently falling through the cracks. California needs a new direction and the implementation of a loan mediation program may be one of the solutions.
Assembly Bill 1588, sponsored by Los Angeles Mayor Antonio Villaraigosa, was recently introduced by Assemblymember Nava and California Assembly Speaker Karen Bass. The measure will establish a monitored mediation program to help homeowners and lenders reach sustainable loan modifications. Under AB 1588, if attempts at loan modification fail, a reasonable transition plan would be established by the borrower and lender. This type of mediation program has proven successful in numerous other states and cities.
“Families working to turn around the economy need the financial system to work for them to avoid foreclosure,” Assembly Speaker Karen Bass (D-Los Angeles) said. “AB 1588 builds upon successful mortgage workout programs other states have used to bring lenders and homeowners together to find alternatives to foreclosure. By providing the monitoring necessary for this process to succeed in California’s tough housing market, I’m confident this legislation will help more families stay in their homes and keep communities intact.”
Nevada Assembly Speaker Barbara Buckley testified today before the committee, stating that she believes Californians can benefit from a program similar to the one she sponsored in Nevada. “No matter where we live, it is critical that we do all we can to help reduce the number of foreclosures and help people stay in their homes. Our program in Nevada has shown initial success in stemming foreclosures. While I understand the obstacles California faces as a non-judicial foreclosure state, I look forward to working with the California Legislature to find ways that a similar program could be implemented, said Speaker Buckley.”
Over the next several weeks, Assemblymember Nava will analyze the testimony given at the hearings regarding loan mediation programs and work with stakeholders to determine how to best move forward to address the current crisis and lessen the detrimental impact on California families.
“I am honored to have Nevada Assembly Speaker Barbara Buckley at the State Capitol today to testify on her successful foreclosure mediation program. I look forward to working with her as we make progress with California’s own monitored mortgage workout program,” said Nava.
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Voluntary Foreclosure Moratoriums Boost Short Sales
November 18th, 2009 Categories: Loan Modification, Real Estate News, Shortsales
My team and I have actually lost three short sale deals to the foreclosure sale at the Sacramento and El Dorado County Courthouses within the last three weeks!
One was an Indy-Mac transaction that IndyMac had approved but the buyer had moved on… we put it back on the market and quickly found another buyer who was willing to pay exactly the same amount that the bank had approved prior. They quickly denied the offer and would not re-schedule the pending foreclosure sale date. They told us it was because of a new policy that they will not take FHA buyers and wanted at least 20%down.
The other two were just not handled correctly by the shortsale negotiator and the forelosure dates were not extended as promised.
More From Chris Mcglaughlin:
According to a securitization research note by Barclays Capital, short sales have been boosted by mandatory and voluntary foreclosure prevention efforts that prevent mortgages from entering real estate owned (REO) status. As federally-funded modifications made through the Home Affordable Modification Program (HAMP) grow in frequency and lenders are expected to hold off on foreclosure proceedings, the REO pipeline shrunk, according to BarCap researchers. The foreclosure prevention efforts have had the effect of “artificially” boosting short sales. “The artificial constraints to foreclosure auctions have resulted in a reduction in REO stock,” BarCap said. “As a result, the net volume of REO liquidations has also dropped.
As short sales are not affected by moratoria, their rate held up and their overall share in distressed sales increased. It has now risen more than 10 points from the lows to about 35% of overall liquidations. It remains to be seen if this increase will sustain itself once the large number of loans sitting in foreclosure are finally released into REO.” BarCap researchers pointed to the difference in severity seen in foreclosure and short sale scenarios as one of the drivers behind servicers choosing short sales.
Servicers that pursue foreclosure on non-performing loans held within securitization have to make principal and interest advances until the loan’s liquidation, BarCap said. If the asset declines in value during the liquidation timeline and it neighbors other REOs, the final selling price will likely come in far below the current broker price opinion (BPO), which leads to high severity. Short sales, on the other hand, pose a shorter timeline during which fewer principal and interest advances are needed. The asset has less time to depreciate, and borrowers have a strong incentive to maintain the property in order to sell it. After all, a better-maintained house attracts stronger bids, reducing overall severity in comparison with the REO liquidation scenario. A short sale also tends to cost the lender less than foreclosure and it spares the borrower the negative credit score implications.
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Sate Pulls Reedevelopment Funds; Gets Sued…
November 9th, 2009 Categories: Loan Modification, Real Estate News, Sacramento Economy
The state’s decision to pull redevelopment funds to solve its budget problems is effecting redevelopment plans in cities throughout the region.
For the second time in Less than two years, California Redevelopment Association has filed a lawsuit against the state over the states plan to take more than $2 billion from the state’s redevelopment agencies to balance the budget.
Redevelopment money is the engine of local economies – getting the ball rolling on big and small projects.
Local Communities will pay the price in terms of lost jobs and community vitality. Kevin Payne, assistant planning and redevelopment director for the city of Roseville Stated in a SacBee article lately “The issue that I see with the state taking our funding is basically, it’s not constitutional,” Payne said, “and it’s really taking opportunity away … to create jobs, housing and a better physical environment overall.”
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Sacramento Trustee Sale Postponements and Face to Face Requirements
November 9th, 2009 Categories: Default News, Loan Modification, Pre Foreclosures, Real Estate News, Sacramento Foreclosures, Sacramento Real Estate Trends, Shortsales
Sacramento Trustee Sales Report
Foreclosure Solution Expert Report
I was visiting with a good friend the other day who attends the Sacramento trustee Sales downtown (Yes, they really have a live auction, some days there are three separate sales going on simultaneously at 720 9TH ST; downtown Sacramento) he said he is still seeing more than 7 out of ten sales being postponed. For some reason or another banks and serivcers are pretty much imposing their own foreclosure moratorium, at least here in Sacramento County.
I am a Home Retention Counselor with Titanium solutions and the assignments have been picking up. I used to get one or so a week, but lately have been getting at least five assignments a week, even though I only cover four Zip Codes with Titanium. Titanium Solutions contracts with loss mitigation departments to contact homeowners who for some reason or another have fallen out of touch with their servicer.
In almost every case, the homeowner has at one time either started a loan modification,agreed to look into a loan modification or they have short sale file started and then had somehow fallen out of contact with the right department at the bank. That’s where Titanium comes in– I will go knock on the door, leave a note, look up past phone numbers etc., and normally I am successful at getting the homeowners back in touch with the bank.
Lately though, I have run across situations where the homeowner has been in touch with the bank and working diligently either on a short sale or a loan modification. I talked to a lady in Folsom the other day who had just hung up the phone with her servicer about a half hour before I showed up. Her file was perfect, needed no updating and was in review. Another evening last week in Granite bay, I sat down with homeowners who had a short sale file in and being negotiated and was supposed to have a short sale approval letter that week,
It makes me wonder, why are these servicers doing that?
In my research for an answer, I came across information that suggests that the major banks, who have still got TARP money are being pressured to make some kind of FACE TO FACE contact with their borrowers before they can use foreclosure as a means of recovery.
So by having it documented that a bank representative has come by face to face, the banks now have the foreclosure solution available to them, should the short sale or loan modification fail. (the Titanium Script that I must use with borrowers clearly states that I am a representative of their servicer and a debt collecter and that any information gathered will be used for that purpose).
Could that perhaps have anything to do with the Sacramento Trustee Sale Postponements? Are the two related in any way or just coincidence?
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