Archive for the 'Mortgage and Loans' Category
Mortgage Rates Drop To New Record Lows!
July 12th, 2010 Categories: Mortgage and Loans
Mortgage Rates Drop To Record Lows
From DSNEWS.COM
The weekly mortgage rate reports released Thursday by Freddie Mac and Bankrate were mixed. But one thing was certain: the average rate for 30-year fixed-rate mortgages hit a new record low.
According to Freddie Mac’s Primary Mortgage Market Survey, 30-year fixed-rate mortgages averaged 4.57 percent with an average 0.7 point for the week ending July 8, 2010, inching down from last week’s average of 4.58 percent. Freddie Mac said this rate marked yet another all-time low in its 39-year survey.
Bankrate also reported a decline in 30-year fixed-rate mortgages. According to its weekly mortgage survey, rates averaged 4.74 percent with an average 0.39 point
this week, falling from last week when 30-year fixed-rate mortgages averaged 4.75 percent.
The story was different for 15-year fixed-rate mortgages, though.
Freddie Mac said 15-year fixed-rate mortgages averaged 4.07 percent with an average 0.7 point this week, edging up from 4.04 percent one week earlier. And Bankrate said 15-year fixed-rate mortgages came in at 4.22 percent with an average 0.36 point, a minor uptick from last week’s average of 4.2 percent.
Despite the slight increase in 15-year fixed-rate mortgages, both Fannie Mae and Bankrate noted that on an overall basis, mortgage rates continued to linger near ultra-low levels, a benefit to homebuyers and refinancers alike.
“With mortgage rates falling to historic lows, refinance activity has been strong over the past three months,” said Frank Nothaft, Freddie Mac VP and chief economist.
“The Bureau of Economic Analysis reported that the effective mortgage rate of all loans outstanding was just below 6 percent in the first quarter of 2010, the lowest since the series began in 1977,” Nothaft said. “Since the start of the second quarter, two out of three mortgage applications on average were for refinancing, according the Mortgage Bankers Association.”
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Mortgages Move Higher as Fed Quits Buying
April 6th, 2010 Categories: Mortgage and Loans, National Real Estate Trends
Uncle Sam Quits Buying And Rates Move Upward
Mortgage Rates Will Continue To Trend Higher As Economy Improves, Feds Quit Buying Mortgage Backed Securities
Courtesy; Evangeline Scott, Summit Funding and MMG Weekly
“YOU DON’T KNOW WHAT YOU GOT UNTIL IT’S GONE – AND I FOUND OUT A LITTLE TOO LATE…”Reserve’s Mortgage Backed Security buying program The words from Chicago’s hit song from the 80’s sums up the market’s sentiment on the ending of the Federal , and the resulting volatility for home loan rates that has already begun.
The Fed did what they set out to do – purchasing $1.25 Trillion in Mortgage Backed Securities, and succeeding in their plan to lower home loan rates and help stabilize the housing sector. And even though they stretched out the length of the program slightly – in order to soften the impact of the end of the program – the training wheels are now off, the safety net is gone, and home loan rates have already moved higher. In fact – as the Fed will now gradually become a seller of their massive holdings of Mortgage Backed Securities – rates are very likely to continue to move higher still.
Even after home loan rates took a jump higher last week, they still remain at reasonably low levels – which makes right now a crucial time to take advantage of the opportunities that exist, including the Homebuyers Tax Credit which is down to its last month. To take advantage of the generous credit, purchase contracts must be signed by the end of April. If you or someone you know has questions about this credit – please don’t wait to get in touch with me.
Adding to last week’s volatility, the official Jobs Report was released last Friday – and according to the report, 162,000 jobs were created in March, making it the biggest one-month increase in three years. Additionally, there were upward revisions to January and February, which brought the last two months’ net job losses to near zero.
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Chart: Nonfarm Payrolls (By Month)
While it was good to see some positive numbers, we’re not exactly out of the woods just yet, as there were some concerning aspects of this Jobs Report. For example, Average Hourly Earnings actually fell 0.1% in March. This could be viewed as a negative sign, indicating that there’s no pressure on companies to pay workers more to retain them. It also shows continued temporary hiring at a lower pay scale.
The official Unemployment Rate remained steady at 9.7%, but when factoring in the “underemployed”, including people who accepted part-time work because full-time work is simply not available, the rate of unemployment overall rose from 16.8% to 16.9%. This is a big number that continues to weigh on the labor market.
Also in the news last week, the US Savings rate moved down to its lowest Level since October 2008. Check out the mortgage market guide view article below for some simple ways to boost your savings.
Forecast for the Week  |
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| This week’s economic calendar may seem slow after the wave of economic news last week. But there are still some big items on tap, starting off right away Monday morning when the Pending Home Sales report gives us a look at the health of the housing industry.
Tuesday brings us the Meeting Minutes from the latest Fed Meeting. Although we already know what the Fed’s policy announcement was, the markets will be looking at the discussion contained in the Meeting Minutes as an indication of what Fed members are thinking and what they may do in the future. On Thursday we’ll get another look at Initial Jobless Claims. Last week, Initial Jobless Claims were reported basically in line with expectations and down from the previous week’s number, and Continuing Jobless Claims declined as well. With those numbers and last week’s official Jobs Report in mind, the market will be watching to see if the labor market can continue to make positive strides. Finally, in addition to those reports, the Treasury Department will auction off $82 Billion in Treasuries. And since most of those will be longer maturities that compete with Mortgage Backed Securities, the auctions could add volatility to the markets depending on how they are received. Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result. As you can see in the chart below, Mortgage Bond prices plunged last week and rates increased .25%. Chart: Fannie Mae 4.5% Mortgage Bond (Friday Apr 09, 2010)
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Fed Says No More MBS Purchases- Interest Rates Move Higher
January 28th, 2010 Categories: Mortgage and Loans, National Real Estate Trends
The Federal Reserve offered its most upbeat economic outlook in nearly a year at the conclusion of its regular two-day policy meeting Wednesday.
After emerging from the closed-door assembly, the Fed committee issued a statement that touted improvements in the labor market and business spending, but cautioned that “recovery is likely to be moderate for a time.”
Taken directly, it may not sound like a rave review, but when you compare it to what Fed officials have been saying since last April-“Economic activity is likely to remain weak for a time”-it’s certainly an improvement.
Even with the rosier outlook, the Federal Reserve committee voted to keep the target range for its benchmark federal funds rate at 0 to 0.25 percent, and noted that “economic conditions…are likely to warrant exceptionally low levels of the federal funds rate for an extended period.”
The decision to maintain the near-zero rate, though, was not unanimous – the first dissenting vote among Fed policymakers since January 2009, according to a CNN report. Thomas M. Hoenig, Kansas City Fed president, felt
economic conditions had improved enough to make exceptionally low rates “no longer warranted,” according to the central bank’s statement.
Fed officials are holding to their plans of pulling back from the secondary market in the coming months. The committee confirmed that its program to purchase mortgage-backed securities (MBS) and debt from the GSEs will come to a close on March 31, as previously signaled. By that time, the Fed says it will have bought $1.25 trillion of MBS and about $175 billion of agency debt. The Federal Reserve has already begun to slow the pace of these purchases to help facilitate a smooth transition when the agency makes its exit.
Michael S. Barr, assistant secretary of the Treasury, says now that markets have begun to stabilize, private participants will start to return when the Fed withdraws its support. He told the Washington Post, “I’m not going to say there will be no effect on rates,” but it should be an orderly transition.
The Fed said it will also be closing a number of its temporary credit facilities over the next few months. The anticipated expiration dates for the Term Asset-Backed Securities Loan Facility (TALF) remain set at June 30 for loans backed by new-issue commercial mortgage-backed securities and March 31 for loans backed by all other types of collateral.
The Fed’s meeting adjourned a day before its top central banker, Ben Bernanke, learns if he will continue as the agency’s chairman after Sunday, when his current term expires. The Senate has scheduled a key vote for Thursday that could instill the Great Depression scholar for another four years, although approval is not a slam dunk. A growing faction of Democrats have already indicated they will not support Bernanke’s reinstatement.
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Stop Foreclosure With Government Shortsale Guidelines
December 22nd, 2009 Categories: Mortgage and Loans, Pre Foreclosures, Shortsales
NEW GOVERNMENT SHORT SALE GUIDELINES:
Loan Mod Fails? Stop Foreclosure with Short Sale/Deed-in-Lieu!
Foreclosure Alternatives for Borrowers Eligible for MHA but Unable to Sustain a Modification
Government
Making Home Affordable
On Feb.18th 2009 the Obama Administration announced the Making Home Affordable (MHA) Program, a comprehensive plan to stabilize the US housing market and offer assistance to up to 7 to 9 million homeowners by reducing mortgage payments to affordable levels and preventing avoidable foreclosures. They are betting on the fact that most homeowners will stick around in a home that is upsidedeown, as long as they can afford it.(low enough monthly payment). Then, two weeks later on March 4th
, they (the Administration) published details of a program that authorized servicers to begin modifications and refinancings under the plan immediately. On April 28th, the Administration announced additional details related to the Second Lien Program and strengthening Hope for Homeowners. Fourteen servicers, including the five largest, have now signed contracts and begun modifications and refinancings under MHA. Between loans covered by these servicers and loans owned or securitized by Fannie Mae or Freddie Mac, more than 75 percent of all loans in the country are now covered by the MHA program.
The rest of this post is directly from a press release way back on May 14th, 2009. It shows that they have been pushing for short sales as a foreclosure most of this past year!
Today we are providing a program update, including additional details on Foreclosure Alternatives and Home Price Decline Protection Incentives. Foreclosure Alternatives will help to prevent costly foreclosures by providing incentives for servicers and borrowers to pursue short sales and deeds-in-lieu of foreclosure in cases where a borrower is eligible for a MHA modification but unable to complete the modification process. This program will assist homeowners who cannot afford to stay in their homes by helping them to avoid foreclosure and relocate to a home they can afford. Building on insights developed by the FDIC, Home Price Decline Protection Incentives will provide additional payments based on recent home price declines, and therefore will incentivize additional modifications in areas where home prices have been falling. By increasing MHA modifications and the use of alternatives to foreclosure, we will reduce the negative impact of foreclosure, minimizing damaging costs for financial institutions, borrowers and communities.
Home Price Decline Protection Incentives and Foreclosure Alternatives, together with the other comprehensive elements of the Making Home Affordable program, will help to stabilize property values for homeowners in neighborhoods hardest hit by foreclosures. Based on estimates of the relationship between foreclosures and home prices, the Home Affordable Modification program could help to bolster home values for the average homeowner by as much as $6,000.
Foreclosure Alternatives and Home Price Decline Protection Incentives
1. Foreclosure Alternatives for Borrowers Eligible for MHA
• Short Sales/Deeds-In-Lieu Program to Facilitate Foreclosure Alternatives o
Incentives for servicers to pursue alternatives to foreclosures o
Borrower incentives to cover relocation expenses to homes that are affordable o
Streamlined process combining short sales and deed-in-lieu transactions
2. Home Price Decline Protection Incentives to Protect Against Falling Home Prices
• Incentives to support modifications in markets hardest hit by falling home prices
o Provides incentives for modifications by providing payments based on recent declines in home prices to reduce the risk of loss to lenders from modifications compared to alternatives that could result in the loss of homeownership
- Foreclosure Alternatives for Borrowers Eligible for MHA but Unable to Sustain a Modification: For eligible borrowers unable to retain their homes through a Home Affordable Modification, MHA will provide incentives to borrowers, servicers and investors to encourage short sales and deeds-in-lieu. Both allow families and servicers to avoid the costly foreclosure process, and to minimize the negative impact of foreclosures on borrowers, financial institutions and communities.
Short Sales/Deeds-In-Lieu Program to Facilitate Foreclosure Alternatives
When a borrower meets the eligibility requirements for a Home Affordable Modification (HAMP) but does not qualify for a modification or cannot maintain payments during the trial period or modification, the servicer may consider a short sale, and if that is unsuccessful, a deed-in-lieu (DIL).
Both a short sale and a DIL provide an opportunity for borrowers and servicers to avoid the foreclosure process. In a short sale, a servicer allows the borrower to sell the property at its current value, even if the sale nets less than the total amount owed on the mortgage. Approval of a short sale requires the borrower to list and actively market the home at its fair value. The sale must be an arms length market transaction with all proceeds (after selling costs) applied to the discounted mortgage payoff. If the borrower actively markets the property but is unable to sell it within the agreed upon time period, a servicer may consider a DIL. With a DIL, the borrower voluntarily transfers ownership of the property to the servicer – provided the title is free and clear.
Short sales and DILs are complex transactions involving careful coordination and close cooperation among a number of parties — servicers, appraisers, borrowers, purchasers, real estate brokers, title agencies and often mortgage insurance companies and junior lien holders. A short sale or DIL usually provides a better outcome for borrowers, investors and communities. However, due to the complexity of and time required for completion of these transactions, servicers historically have often opted to pursue foreclosure instead, even where a short sale or DIL would have provided a substantially better outcome for borrowers, investors and communities.
The MHA Foreclosure Alternatives Program simplifies and streamlines the short sale and DIL process by providing a standard process flow, minimum performance timeframes and standard documentation. To compliment a standardized approach, Treasury provides incentives to borrowers, servicers and investors to pursue short sales and DILs.
How The Home Affordable Short Sale/DIL Program Works:
- Borrower Eligibility. Borrowers will be eligible for the Foreclosure Alternative Program if they meet the minimum eligibility criteria for a Home Affordable Modification but did not qualify for a modification or were unable to sustain payments under a trial period plan or a modification. Prior to proceeding to foreclosure, participating servicers must evaluate each eligible borrower to determine if a short sale is appropriate. Considerations in the determination include property condition and value, average marketing time in the community where the property is located, the condition of the title including the presence of junior liens and a determination that the net sales proceeds are expected to exceed the investor’s recovery through foreclosure Incentive Payments.
Servicers may receive incentive compensation of up to $1,000 for successful completion of a short sale or DIL.
- ��� Borrowers may receive incentive compensation of up to $1,500 to assist with relocation expenses.
- ������Treasury will also share the cost of paying junior lien holders to release their claims, matching $1 for every $2 paid by the investors, up to a total contribution of $1,000 by Treasury.
- Standardized Documentation: The program will publish streamlined and standardized documentation, including a Short Sale Agreement and an Offer Acceptance Letter. These documents will outline specific marketing terms, describe the rights and responsibilities of all parties and establish clear timeframes for performance. Creating one standard set of documents that the industry can use is expected to minimize the complexity of these transactions and significantly increase use of the short sale option.
- Property Valuation: The servicer will independently establish both property value and the minimum acceptable net return in accordance with investor guidance and will provide instruction to the borrower regarding the list price and any permissible price reductions. The price may be determined based on either: (1) an appraisal performed in accordance with USPAP and/or (2) one or more Broker Price Opinions either of which must be dated within 120 days of the Short Sale Agreement.
- Minimum and Maximum Duration: Under the program, servicers will allow borrowers at least 90 days to market and sell the property, with possibly more time based on local market conditions. The property must be listed with a licensed realtor experienced in selling properties in the neighborhood. Marketing of the property may run concurrently with the foreclosure process, however no foreclosure sale can take place during the marketing period specified in the Short Sale Agreement as long as the borrower is acting in good faith to sell the property. There will be a maximum marketing period of 1 year for the property, provided any longer period not otherwise delay foreclosure sale, to ensure diligence by servicers and borrowers in moving as quickly as possible to complete the short sale and deed-in-lieu process.
- Selling Commissions and Fees: Reasonable and customary real estate commissions and selling costs that may be deducted from the sales price will be specified in the Short Sale Agreement. The Servicer will agree not to negotiate a lower sales commission after an offer has been received.
- Fees and Charges: Servicers may not charge borrowers fees for participation in the Foreclosure Alternative Program.
- Property Eligibility: Any junior liens, mortgages or other debts against the property must be cleared for the property to be sold as a short sale or deeded to the servicer. The servicer can proceed with a short sale or deed-in-lieu if there is a reasonable belief that all liens on the property can be cleared.
- Program Expiration: Eligible borrowers will be accepted until December 31, 2012. Program payments will be made upon successful completion of a short sale or DIL.
- Deed-in-Lieu: At the servicer’s option, the Short Sale Agreement may include a condition that the borrower agrees to deed the property to the servicer in exchange for a release from the debt if the property does not sell within the time specified in the Agreement or any extension thereof. In this case the borrower would have 30 days to vacate the property and would be entitled to $1,500 to assist with relocation expenses, in addition to any other funds the servicer may provide to the borrower.
- Home Price Decline Protection Incentives to Protect Against Falling Home Prices: This initiative provides lenders additional incentives for modifications where home price declines have been most severe and lenders fear these declines may persist. These incentives will encourage servicers to undertake more modifications by assuring that incremental investor losses will be partially offset.
To encourage the modification of more mortgages and enable more families to keep their homes, the Administration, building on insights pioneered by Chairman Bair and the FDIC, has developed an innovative payment that provides compensation based on recent home price declines, structured as a simple cash payment on every eligible loan. Home Price Decline Protection (HPDP) incentives are designed to address investor concerns that recent home price declines may persist. Together the incentive payments on all modified homes will help cover the incremental collateral loss on those modifications that do not succeed. HPDP payments will be linked to the rate of recent home price decline in a local housing market, as well as the average cost of a home in that market.
- Increases Number of Loans that Are Modified: Making Home Affordable will make payments totaling up to $10 billion to to encourage lenders, servicers and investors to modify rather than foreclose by addressing concerns that home price declines will persist in the future. This should increase the number of modifications completed under the MHA program in markets hardest hit by falling home prices.
How The Program Works:
- Payments will be based on the total number of modified loans that successfully complete the modification trial period and remain in the modification program.
- Each successful modification will be eligible for a HPDP incentive, up to a cap for HPDP incentives of $10 billion.
- If the trial modification remains successful, 1/24th of the HPDP incentive will accrue to the lender/investor each month for up to 24 months. HPDP incentive payments will be made at the end of the first and second year of the modification.
- Calculation of HPDP Incentives: HPDP incentive amounts will be calculated based on a formula incorporating:
- Declines in average local market home prices over recent quarters prior to the quarter in which the loan was modified based on housing price indices; and
- The average price of a home in each particular market, since the potential loss due to a given rate of home price decline will be larger in higher cost areas
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1.7 Million Additional Bank Owned Homes and Homes Facing Imminent Foreclosure
December 18th, 2009 Categories: Default News, Mortgage and Loans, National Real Estate Trends, Pre Foreclosures
First American Puts ‘Shadow Inventory’ at 1.7 Million
From DSNewsThere were 1.7 million REOs and homes facing imminent foreclosure that had not yet hit the market at the end of the third quarter, according to data released Thursday by First American CoreLogic.
The company says that at the current sales pace, it would take 3.3 months to get rid of this looming “shadow inventory.” By comparison, First American CoreLogic says shadow inventory a year ago was 1.1 million, representing a 2.4 month backlog.
Shadow inventory is not included in official measures of unsold inventory. According to First American CoreLogic’s
analysis, the visible supply of unsold inventory – accounting for new and existing homes that are currently on the market – was 3.8 million units in at the end of September, down from 4.7 million a year earlier. The visible months’ supply fell to 7.8 months in September 2009, down from 10.1 months a year earlier.
Together, total inventory of unseen and marketed properties comes to 5.5 million units as of September 2009, an 11.1 months’ supply of homes. That figure is down from a total inventory of 5.7 million a year ago, which equates to a 12.7 months backlog.
First American CoreLogic says this indicates that while the visible months’ supply has decreased and is beginning to approach more normal levels, adding in the pending supply reveals there is still quite a bit of inventory that will impact the housing market for the next few years.
Just how big of an impact the shadow inventory makes will depend on whether it hits the market in large fell swoops or makes its way out of the darkness in steady, manageable streams. According to a new report from Radar Logic, the looming distressed property supply will enter the housing market at a controlled rate that can be absorbed by existing demand without drastically reducing prices
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Sacramento Area Foreclosure News
December 11th, 2009 Categories: Default News, Mortgage and Loans, Sacramento Economy, Sacramento Foreclosures, Sacramento Real Estate
The Foreclosure market here in Sacramento is currently drying up… very few homes coming on the market as REO or bank-owned, fewer foreclosure filings, Multiple offers for the homes that are priced right, and an overall sense of “wait and see” seems to be on most potential buyers’ minds right now.
The banks have been rescheduling foreclosure sales or Trustee Sales at the county courthouse for so long, that now the foreclosure departments just haven’t been scheduling them in the first place– kinda makes sense, if all your going to do is reschedule it and put it off anyway; why spend the time and money on scheduling it in the first place?
If the number of buyers at the foreclosure sale (trustee sale) is any indication– there must be many investors who believe the prices are not going much lower, or who think there may be some up-tick in the market sometime soon: the number of buyers has tripled or quadrupled in the last several months and continues to grow, according to friends who attend the sales down at 720 9th St. downtown Sacramento (address for the Sacramento County Municipal and Superior Courts). they say tat over 90% of foreclosure sales are postponed still, or re-scheduled, usually for only 30 days at a time…
In other Sacramento area real estate news: According to OBSNews
An amendment co-authored by Sacramento Congresswoman Doris Matsui (D–California) has been based by the House of Representatives and was added to the Wall Street Reform and Consumer Protection Act (H.R. 4173) yesterday. The act requires mortgage servicers or lenders who are participating in the Making Home Affordable Program (HAMP) to publicly report their progress in helping responsible homeowners stay in their homes. The amendment was introduced by Congresswoman Matsui with Rep. Betty Sutton (D–Ohio) and Rep. Kathy Castor (D–Florida), and debated on the House floor. Passage of H.R. 4173 is expected today.
“Too many families in my district of Sacramento have faced foreclosure on their homes as a direct result of the economic meltdown,” stated Matsui. “There is another uptick in foreclosures expected that could affect as many as 4.5 million homeowners over the next two years. The Making Home Affordable Program holds the potential to greatly reduce these figures, and my amendment will ensure accountability on the mortgage industry. Transparency will incentivize the mortgage industry to help responsible homeowners stay in their homes.”
Some information courtesy (OBSNews.com)
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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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More than 18 percent of FHA borrowers are at least one payment behind
November 20th, 2009 Categories: Graphs and Charts, Mortgage and Loans, Pre Foreclosures, Real Estate News, Real Estate Trends
FHA Foreclosures Surge
Did you read that?
FHA foreclosures? Holy cow; that means nearly one in five FHA loans are more than 30 days behind! Most of those FHA borrowers would have bought since the mortgage crash of 2007, since FHA loans were almost extinct before that…
The Mortgage Bankers Association also found recently that 14 percent of all homeowners with any type of mortgage were either behind on payments or in foreclosure at the end of September. It was a record-high figure for the ninth straight quarter.
As they say; even a dead cat will bounce– The media had it all wrong this summer; calling for a bottom and raising hopes of a housing turn-around… There are still many, many more homes coming through the fore closure pipeline…
Loan modification starts are way up, nearly 700,000 homeowners nationally (about 20% of those who qualify) have started the modification process. However, over 75% of those will default again, recent history shows us. And of the 25% that don’t default, how many of them will re-consider when they finally realize that only 10% of loan modifications have any type of principle reduction… it may take 20 years in some areas to get back to ‘ground zero’ or where folks can sell without going short or bringing money to the closing table.
I am really not a pessimistic person, in fact I am too optimistic usually and it has cost me a lot of money and pain by seeing through “rose colored glasses” in the past. I just really see too many signs of more problems to come and think we are a long way from the bottom
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DRE Takes Aggressive Action Against Scammers
November 16th, 2009 Categories: Mortgage and Loans, Pre Foreclosures, Real Estate News, Sacramento Real Estate
SACRAMENTO, Calif. – (Business Wire) The California State Department of Real Estate (DRE), the state department that issues licenses to real estate professionals and protects consumers in real estate transactions, has intensified its efforts to ensure all consumers receive the protection they deserve.
See the Earth Times Article here
Real Estate Commissioner Jeff Davi said recently “The economic downturn coupled with the unprecedented number of foreclosures has created a rich environment for scammers who have come up with a variety of schemes to take advantage of desperate and financially stressed homeowners, not only must we take aggressive regulatory action against these con artists but we must educate and provide homeowners with the necessary tools to protect themselves against scammers who have charged thousands of dollars in upfront fees and deliver nothing in return.”
Loan modification scams in particular are plaguing of course, California, Nevada and Florida, but also other states as well…
One of the biggest steps that the DRE here in Sacramento has done recently to combat these scams is to re-write the most recent Public Service Announcement in Spanish, the PSA is a comprehensive document warning consumers of loan fraud. Now the DRE has also expanded its Spanish language Website to educate consumers on how to avoid falling victim to a loan scam.
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