The average rate for 30-year fixed loans inched up from 4.21 percent the previous week, mortgage buyer Freddie Mac said Thursday. Earlier in the month, rates fell to 4.19 percent, the lowest average on records dating back to 1971.
The average rate on 15-year fixed loans rose to 3.66 percent. That was up from 3.64 percent a week earlier.
Rates have been falling since April. They have remained low this month because investors have been buying up Treasury bonds in anticipation of the Federal Reserve’s likely move to buy Treasurys to stimulate the economy. That demand lowers Treasury yields, which mortgage rates tend to track.
Low rates haven’t helped the struggling housing market, which recorded its worst summer in more than a decade. But they have led to a modest surge in refinancing.
To calculate average mortgage rates, Freddie Mac collects rates from lenders around the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a given day.
Rates on five-year adjustable-rate mortgages averaged 3.41 percent, down from 3.45 percent a week earlier. Rates on one-year adjustable-rate mortgages remained at an average of 3.3 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.
The nationwide fee for loans in Freddie Mac’s survey averaged 0.8 a point for 30-year loans. It averaged 0.7 of a point for 15-year and 1-year mortgages and 0.6 of a point for 5-year mortgages.
Source: The Associated Press, Alan Zibel, AP real estate writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Friday, October 29, 2010
Title insurers drop demands on lenders
The dispute between mortgage servicers and three large title insurance companies that account for 52 percent of the market – First American Financial, Old Republic International and Stewart Information Services – ended when the title insurers stopped demanding written indemnifications from lenders that are selling foreclosed houses.
Fannie Mae, Freddie Mac and the Federal Housing Finance Agency (FHA) first drafted the indemnification agreements in early October to ensure the market for foreclosed properties continued to function.
Title insurers guarantee that the chain of ownership of a certain property is clear, which protects buyers and lenders from risk, and the indemnification was to protect insurers from legal fees and other expenses if a court overturned a foreclosure due to mishandled paperwork or incorrect legal procedures.
Title insurers are now expected to evaluate home-sale records on a case-by-case basis before underwriting title insurance policies for lenders and new owners.
Source: Washington Post (DC) (10/29/10) P. A18; Razzi, Elizabeth
Source: INFORMATION, INC. Bethesda, MD
Fannie Mae, Freddie Mac and the Federal Housing Finance Agency (FHA) first drafted the indemnification agreements in early October to ensure the market for foreclosed properties continued to function.
Title insurers guarantee that the chain of ownership of a certain property is clear, which protects buyers and lenders from risk, and the indemnification was to protect insurers from legal fees and other expenses if a court overturned a foreclosure due to mishandled paperwork or incorrect legal procedures.
Title insurers are now expected to evaluate home-sale records on a case-by-case basis before underwriting title insurance policies for lenders and new owners.
Source: Washington Post (DC) (10/29/10) P. A18; Razzi, Elizabeth
Source: INFORMATION, INC. Bethesda, MD
New credit score for mortgage loans
FICO announced that its latest credit scoring product, the FICO 8 Mortgage Score, is now available from all three major U.S. credit reporting agencies.
The FICO 8 Mortgage Score was built specifically to help lenders better predict mortgage performance and improve credit decisions. The score analyzes the full credit history on file to deliver a better assessment of mortgage repayment risk, with an eye toward cutting down on the number of future foreclosures. FICO claims a 15 percent performance improvement over credit scores currently available.
“To do the best job of evaluating risk and increasing profits, lenders need updated credit scoring analytics that incorporate mortgage credit performance since the subprime mortgage meltdown,” says Craig Focardi, senior research director at TowerGroup.
The FICO 8 Mortgage Score retains the same 300-850 scoring range, minimum scoring criteria, authorized user and inquiry treatment as the general-risk FICO score. To achieve its increase in predictive strength for mortgages, the FICO 8 Mortgage Score assesses additional data from consumer credit files to predict mortgage repayment risk.
The FICO 8 Mortgage Score also includes additional score reason codes, compliant with the Fair Credit Reporting Act, to help lenders understand and explain the scores to applicants.
Source: Florida Realtors®
The FICO 8 Mortgage Score was built specifically to help lenders better predict mortgage performance and improve credit decisions. The score analyzes the full credit history on file to deliver a better assessment of mortgage repayment risk, with an eye toward cutting down on the number of future foreclosures. FICO claims a 15 percent performance improvement over credit scores currently available.
“To do the best job of evaluating risk and increasing profits, lenders need updated credit scoring analytics that incorporate mortgage credit performance since the subprime mortgage meltdown,” says Craig Focardi, senior research director at TowerGroup.
The FICO 8 Mortgage Score retains the same 300-850 scoring range, minimum scoring criteria, authorized user and inquiry treatment as the general-risk FICO score. To achieve its increase in predictive strength for mortgages, the FICO 8 Mortgage Score assesses additional data from consumer credit files to predict mortgage repayment risk.
The FICO 8 Mortgage Score also includes additional score reason codes, compliant with the Fair Credit Reporting Act, to help lenders understand and explain the scores to applicants.
Source: Florida Realtors®
Wells Fargo erred in thousands of foreclosures
Wells Fargo admitted Wednesday it made mistakes in the paperwork for thousands of foreclosure cases and promised to fix them. The San Francisco-based bank said it plans to refile documents in 55,000 of the cases by mid-November. The company said not all those cases included errors but didn’t say how many thousands did.
Wells Fargo described the mistakes as technical and said it has no plans to halt the foreclosure process, though filing new paperwork will cause some delays.
“We don’t believe that there are instances in which the foreclosures would not have occurred otherwise,” said Teri Schrettenbrunner, a Wells Fargo spokeswoman. The documents are being refiled in the 23 states where a judge’s approval is needed to complete a foreclosure.
Wells Fargo & Co.’s CEO, John Stumpf, has declined to join Bank of America Corp., Ally Financial Inc.’s GMAC Mortgage and other banks in suspending foreclosures because of flawed paperwork that surfaced at several large banks.
On a conference call with investors this month, Stumpf said the bank is “confident that our practices, procedures and documentation” are accurate.
Depositions of two Wells Fargo employees have called the company’s foreclosure practices into question. A Fort Mill, S.C.-based Wells employee said in a deposition taken last March that she signed between 300 and 500 foreclosure documents per day,
In another deposition taken in May, another Wells employee said he verified only the dates on up to 150 foreclosure documents he signed daily and relied on co-workers to ensure that other information was correct.
Bank of America is scheduled to meet Thursday with state officials investigating allegations the bank rushed the foreclosure process without properly reviewing documents.
A person briefed on the matter confirmed the parties will have a preliminary discussion about issues related to the foreclosure documents. The person did not give details about the meeting or who will participate. The person, who spoke on condition of anonymity, was not authorized to speak publicly.
Bank of America, based in Charlotte, North Carolina, said in a statement: “We have been cooperating with the attorneys general and continue to have dialogue and share information with these important stakeholders.”
The bank resumed foreclosures this week after halting them temporarily to resubmit documents with a new process designed to correct any mistakes such as misspelled names or incorrect numbers.
Attorneys general in all 50 states and the District of Columbia are jointly investigating whether paperwork and legal procedures were handled properly in hundreds of thousands of cases.
Besides state regulators, banking regulators including the Federal Reserve are examining whether mortgage companies cut corners on their own procedures when they moved to foreclose on people’s homes.
Despite the problems, the Obama administration maintains there is no need to halt foreclosures in all 50 states. On Wednesday, Phyllis Caldwell, chief of the Treasury Department’s homeownership preservation office, told a financial bailout watchdog panel that there was no evidence of risk to the financial system from the documents scandal – or from efforts by mortgage investors to force banks to buy back problem loans.
Source: The Associated Press, Alan Zibel, AP real estate writer. AP Business Writer Marcy Gordon contributed to this report.
Wells Fargo described the mistakes as technical and said it has no plans to halt the foreclosure process, though filing new paperwork will cause some delays.
“We don’t believe that there are instances in which the foreclosures would not have occurred otherwise,” said Teri Schrettenbrunner, a Wells Fargo spokeswoman. The documents are being refiled in the 23 states where a judge’s approval is needed to complete a foreclosure.
Wells Fargo & Co.’s CEO, John Stumpf, has declined to join Bank of America Corp., Ally Financial Inc.’s GMAC Mortgage and other banks in suspending foreclosures because of flawed paperwork that surfaced at several large banks.
On a conference call with investors this month, Stumpf said the bank is “confident that our practices, procedures and documentation” are accurate.
Depositions of two Wells Fargo employees have called the company’s foreclosure practices into question. A Fort Mill, S.C.-based Wells employee said in a deposition taken last March that she signed between 300 and 500 foreclosure documents per day,
In another deposition taken in May, another Wells employee said he verified only the dates on up to 150 foreclosure documents he signed daily and relied on co-workers to ensure that other information was correct.
Bank of America is scheduled to meet Thursday with state officials investigating allegations the bank rushed the foreclosure process without properly reviewing documents.
A person briefed on the matter confirmed the parties will have a preliminary discussion about issues related to the foreclosure documents. The person did not give details about the meeting or who will participate. The person, who spoke on condition of anonymity, was not authorized to speak publicly.
Bank of America, based in Charlotte, North Carolina, said in a statement: “We have been cooperating with the attorneys general and continue to have dialogue and share information with these important stakeholders.”
The bank resumed foreclosures this week after halting them temporarily to resubmit documents with a new process designed to correct any mistakes such as misspelled names or incorrect numbers.
Attorneys general in all 50 states and the District of Columbia are jointly investigating whether paperwork and legal procedures were handled properly in hundreds of thousands of cases.
Besides state regulators, banking regulators including the Federal Reserve are examining whether mortgage companies cut corners on their own procedures when they moved to foreclose on people’s homes.
Despite the problems, the Obama administration maintains there is no need to halt foreclosures in all 50 states. On Wednesday, Phyllis Caldwell, chief of the Treasury Department’s homeownership preservation office, told a financial bailout watchdog panel that there was no evidence of risk to the financial system from the documents scandal – or from efforts by mortgage investors to force banks to buy back problem loans.
Source: The Associated Press, Alan Zibel, AP real estate writer. AP Business Writer Marcy Gordon contributed to this report.
Thursday, October 28, 2010
5 traits of today’s homebuyers
A survey conducted for the trade magazine Builder by American Lives, a consumer research firm based in California, attempted to outline the top five traits of today’s homebuyers. The study found the following:
• They are young. Most are under 45. Half said they had annual household incomes of $75,000 or less. Two-thirds are married.
• They are frugal. They consistently told surveyors they were eager to live a simple lifestyle.
• They worry about their financial future. About 70 percent said the economy is “not so good” with 27 percent saying it was getting worse, 27 percent saying it was getting better and two-thirds saying it would get better in a year. Some 55 percent said they were concerned that they might lose their jobs.
• They see themselves as energy efficient but not necessarily “green.” About 32 percent said they’d pay extra for energy-efficient features but only 16 percent said they’d pay extra for recycled or renewable construction materials.
• Neighborhood is important. Ninety-five percent said they thought the community was as important as the home itself. Seventy-nine percent wanted the most square footage they could afford, but 69 percent said they’d consider a smaller home in the right neighborhood.
Source: Inman News, Mary Umberger (10/27/2010)
Source: INFORMATION, INC. Bethesda, MD
• They are young. Most are under 45. Half said they had annual household incomes of $75,000 or less. Two-thirds are married.
• They are frugal. They consistently told surveyors they were eager to live a simple lifestyle.
• They worry about their financial future. About 70 percent said the economy is “not so good” with 27 percent saying it was getting worse, 27 percent saying it was getting better and two-thirds saying it would get better in a year. Some 55 percent said they were concerned that they might lose their jobs.
• They see themselves as energy efficient but not necessarily “green.” About 32 percent said they’d pay extra for energy-efficient features but only 16 percent said they’d pay extra for recycled or renewable construction materials.
• Neighborhood is important. Ninety-five percent said they thought the community was as important as the home itself. Seventy-nine percent wanted the most square footage they could afford, but 69 percent said they’d consider a smaller home in the right neighborhood.
Source: Inman News, Mary Umberger (10/27/2010)
Source: INFORMATION, INC. Bethesda, MD
Apartments are a good investment for some
The property in Fort Lauderdale was originally valued at $285,000. Clint Gordon, a private investor in multifamily properties, offered the bank $50,000, and within 10 days, had closed the deal. A few days later, he began renting it for $15,000 a year.
“Anybody who’s getting into this business now, you get a whole lot of return if you’re paying cash for properties,” he says. “You’re just buying them so cheap.”
Prices for apartment buildings are “incredible” in Indianapolis, as well, says Barb Getty, who owns 27 apartment properties in the downtown area. “You can start small like I did; 20 percent of 40 thousand bucks isn’t a lot of money.”
Just as there have been massive price drops for single-family homes in the past three years, there have been big price declines for apartment buildings. That suggests that it’s a good time for investors who want to be landlords to start buying.
But as with all investments, the story isn’t quite so simple. Investors who thought that a tsunami of dirt-cheap multifamily properties would wash over the U.S. market in the past two years have been largely disappointed.
The economic distress that led to lower prices was limited to certain places and property types, says Hessam Nadji, managing director at real estate investment services firm Marcus & Millichap. “The pain was concentrated where we had gross overbuilding in overall housing: Florida, Phoenix, Las Vegas, Southern California, and to some degree, smaller markets like Tucson, Charlotte and Atlanta.”
Marc Solomon, whose Solomon Organization owns 10,000 garden apartments in New York, New Jersey, Connecticut and Pennsylvania, says that it’s difficult to find opportunities that make good business sense in his markets, which still offer slow, steady returns. There are “a lot of dollars out there chasing these deals,” he says.
While there were big price cuts for multifamily housing in North Carolina’s Research Triangle area near Winston-Salem, competition is driving down yields, says Jim Scofield, senior investment adviser at multifamily real estate broker Apartment REP. The yield is called the “cap rate” and is net operating income for one year divided by the sale price. Last October, an investment firm “got a steal” on a community in Raleigh called Autumn River, he said, with a cap rate of about 7.75 percent. The most recent transaction in the area involved a community called Southern Oaks, which had a 5 percent cap rate. Average cap rates are still around 6.5 percent.
“This is not just a phenomenon in the Triangle, but in all the major markets, and especially all the apartment markets,” Scofield says. “Manhattan, Washington, D.C., Los Angeles, Denver, Chicago, Boston.”
Risk and return
There is less competition in markets where the supply is more fluid, but the risks are also higher.
“We landlords are happy,” says Getty, adding that the only thing preventing her from buying more properties is the ability to manage them on her own. Still, she hasn’t been able to increase rents as much as she normally would.
Gordon says his vacancies used to average three to five days. “Now, I can have a vacancy for up to 60 days,” he says.
Despite all the qualifiers, there is opportunity in rental apartments because the timing is good, Nadji says. “I don’t think you’re going to get fire-sale prices,” he says. “But you can get that kind of return ahead of the job growth and ahead of the economic recovery.”
Rental occupancy rates shrank dramatically during the recession, as people doubled up and young adults boomeranged back home. Vacancies nationwide hit a high of 8 percent in the last quarter of 2009, according to real estate research company Reis. But industry insiders argue that rentals will bounce back quickly and dramatically. In the third quarter of this year, vacancies fell to 7.2 percent, Reis says.
“Apartment rents are short term; they adjust to market conditions very quickly,” Hessam says. “We’ve seen a record demand for rental apartments so far this year, the strongest in over 10 years.”
Wide-ranging perspective
Apartment buildings can be attractive because investing in residential real estate seems similar to owning a home. But rental properties are different, starting from the purchase decision.
Home buyers tend to look for a place they love that fits their needs and budget. But you have to see investment properties through the eyes of your tenant, Getty says. If your tenants won’t have cars, is it near public transportation?
Randall Gorman, president of La Jolla Capital Group in California, says prospective investors need to take the emotion out of their purchases.
“I don’t care if you’re buying a condo, a duplex or a 10-unit building,” Gorman says. “Just because you’ve always loved that cottage-style apartment building that you drove by taking your kids to school doesn’t mean the cash-flow fundamentals work at a given price.”
If considering a property, Gorman advises making sure you can run a cash-flow model. Figure out property rents by researching online and in the neighborhood. Calculate annual revenue, and thoroughly survey costs such as maintenance, taxes, utilities and incentives. (Property managers typically charge about 10 percent of a month’s rent.)
Add a couple of months of vacancy, and don’t disregard higher interest rates for commercial properties. According to PricewaterhouseCoopers, the national average interest rate for apartment loans in the third quarter was 5.68 percent. For the first week of October, Fannie Mae reported that the average 30-year fixed rate for a primary home was 4.27 percent. If your final annual net income is $16,000, seeking a 10 percent cap rate puts the purchase price at $160,000.
“Don’t buy on what might happen, but on what is happening,” Scofield says. “Only buy a property if it is cash flowing to meet your investment return requirement on day one.”
Once you buy, it’s not a smart idea to treat your investment like a home. “Investors make a huge mistake when they spend a lot of money on bells and whistles in their rental property,” Getty says. “A rental needs to compare well to others in the neighborhood, but don’t make it a palace – you won’t get that money back.”
Source: USA TODAY, a division of Gannett Co. Inc., Sara Clemence.
“Anybody who’s getting into this business now, you get a whole lot of return if you’re paying cash for properties,” he says. “You’re just buying them so cheap.”
Prices for apartment buildings are “incredible” in Indianapolis, as well, says Barb Getty, who owns 27 apartment properties in the downtown area. “You can start small like I did; 20 percent of 40 thousand bucks isn’t a lot of money.”
Just as there have been massive price drops for single-family homes in the past three years, there have been big price declines for apartment buildings. That suggests that it’s a good time for investors who want to be landlords to start buying.
But as with all investments, the story isn’t quite so simple. Investors who thought that a tsunami of dirt-cheap multifamily properties would wash over the U.S. market in the past two years have been largely disappointed.
The economic distress that led to lower prices was limited to certain places and property types, says Hessam Nadji, managing director at real estate investment services firm Marcus & Millichap. “The pain was concentrated where we had gross overbuilding in overall housing: Florida, Phoenix, Las Vegas, Southern California, and to some degree, smaller markets like Tucson, Charlotte and Atlanta.”
Marc Solomon, whose Solomon Organization owns 10,000 garden apartments in New York, New Jersey, Connecticut and Pennsylvania, says that it’s difficult to find opportunities that make good business sense in his markets, which still offer slow, steady returns. There are “a lot of dollars out there chasing these deals,” he says.
While there were big price cuts for multifamily housing in North Carolina’s Research Triangle area near Winston-Salem, competition is driving down yields, says Jim Scofield, senior investment adviser at multifamily real estate broker Apartment REP. The yield is called the “cap rate” and is net operating income for one year divided by the sale price. Last October, an investment firm “got a steal” on a community in Raleigh called Autumn River, he said, with a cap rate of about 7.75 percent. The most recent transaction in the area involved a community called Southern Oaks, which had a 5 percent cap rate. Average cap rates are still around 6.5 percent.
“This is not just a phenomenon in the Triangle, but in all the major markets, and especially all the apartment markets,” Scofield says. “Manhattan, Washington, D.C., Los Angeles, Denver, Chicago, Boston.”
Risk and return
There is less competition in markets where the supply is more fluid, but the risks are also higher.
“We landlords are happy,” says Getty, adding that the only thing preventing her from buying more properties is the ability to manage them on her own. Still, she hasn’t been able to increase rents as much as she normally would.
Gordon says his vacancies used to average three to five days. “Now, I can have a vacancy for up to 60 days,” he says.
Despite all the qualifiers, there is opportunity in rental apartments because the timing is good, Nadji says. “I don’t think you’re going to get fire-sale prices,” he says. “But you can get that kind of return ahead of the job growth and ahead of the economic recovery.”
Rental occupancy rates shrank dramatically during the recession, as people doubled up and young adults boomeranged back home. Vacancies nationwide hit a high of 8 percent in the last quarter of 2009, according to real estate research company Reis. But industry insiders argue that rentals will bounce back quickly and dramatically. In the third quarter of this year, vacancies fell to 7.2 percent, Reis says.
“Apartment rents are short term; they adjust to market conditions very quickly,” Hessam says. “We’ve seen a record demand for rental apartments so far this year, the strongest in over 10 years.”
Wide-ranging perspective
Apartment buildings can be attractive because investing in residential real estate seems similar to owning a home. But rental properties are different, starting from the purchase decision.
Home buyers tend to look for a place they love that fits their needs and budget. But you have to see investment properties through the eyes of your tenant, Getty says. If your tenants won’t have cars, is it near public transportation?
Randall Gorman, president of La Jolla Capital Group in California, says prospective investors need to take the emotion out of their purchases.
“I don’t care if you’re buying a condo, a duplex or a 10-unit building,” Gorman says. “Just because you’ve always loved that cottage-style apartment building that you drove by taking your kids to school doesn’t mean the cash-flow fundamentals work at a given price.”
If considering a property, Gorman advises making sure you can run a cash-flow model. Figure out property rents by researching online and in the neighborhood. Calculate annual revenue, and thoroughly survey costs such as maintenance, taxes, utilities and incentives. (Property managers typically charge about 10 percent of a month’s rent.)
Add a couple of months of vacancy, and don’t disregard higher interest rates for commercial properties. According to PricewaterhouseCoopers, the national average interest rate for apartment loans in the third quarter was 5.68 percent. For the first week of October, Fannie Mae reported that the average 30-year fixed rate for a primary home was 4.27 percent. If your final annual net income is $16,000, seeking a 10 percent cap rate puts the purchase price at $160,000.
“Don’t buy on what might happen, but on what is happening,” Scofield says. “Only buy a property if it is cash flowing to meet your investment return requirement on day one.”
Once you buy, it’s not a smart idea to treat your investment like a home. “Investors make a huge mistake when they spend a lot of money on bells and whistles in their rental property,” Getty says. “A rental needs to compare well to others in the neighborhood, but don’t make it a palace – you won’t get that money back.”
Source: USA TODAY, a division of Gannett Co. Inc., Sara Clemence.
Foreclosure activity up across most U.S. metro areas
The foreclosure crisis intensified across a majority of large U.S. metropolitan areas this summer, with Chicago and Seattle – cities outside of the states that have shouldered the worst of the housing downturn – seeing a sharp increase in foreclosure warnings.
California, Nevada, Florida and Arizona remain the nation’s foreclosure hotbeds, accounting for 19 of the top 20 metropolitan areas with the highest foreclosure rates between July and September, foreclosure listing firm RealtyTrac Inc. said Thursday. Those states saw housing values surge during the housing boom years. When the boom ended, values collapsed and foreclosures soared.
But the latest data show that many of the metro areas in those states saw a decline in the number of households receiving foreclosure-related filings, while many cities in other states saw a spike in foreclosure activity.
“The epidemic is spreading from the states at the ground zero of the foreclosure problems out into areas that hadn’t been previously affected,” said Rick Sharga, a senior vice president at RealtyTrac.
The trend is the latest sign that the nation’s foreclosure crisis is worsening as homeowners facing high unemployment, slow job growth and uncertainty about home prices continue to fall behind on their mortgage payments.
In all, 133 out of 206 metropolitan areas with at least 200,000 residents posted an annual increase in foreclosure activity in the three months ended Sept. 30, RealtyTrac said.
The firm tracks notices for defaults, scheduled home auctions and home repossessions – warnings that can lead up to a home eventually being lost to foreclosure.
Eleven out of the nation’s 20 largest metropolitan areas saw foreclosure activity increase in the third quarter compared to the same period last year. The Seattle-Tacoma-Bellevue metro area registered the sharpest annual increase – 71 percent. One in every 129 households received a foreclosure filing.
The Chicago-Naperville-Joliet metropolitan area posted the second-highest annual jump, a 35 percent increase. One in every 84 households received a foreclosure notice.
Among the other metro areas where foreclosure activity jumped by a large margin this summer were Houston-Sugar Land-Baytown, up 26 percent; Detroit-Warren-Livonia, at nearly 23 percent; and, Atlanta-Sandy Springs-Marietta, up 20 percent.
Economic woes, such as unemployment or reduced income, continue to be the main catalysts for foreclosures this year. The U.S. unemployment rate hit 9.6 percent last month.
In the Seattle metro area, unemployment stood slightly lower at 8.5 percent in August and has been edging lower. It was 8.7 percent in August last year.
Still, many troubled homeowners have been unable to hang on. As a result, there’s been no letup in the inventory of foreclosed homes on the market this year, says John Bauer, an agent with ZipRealty in Seattle who represents lenders selling foreclosed properties.
“It has been on an upward trend curve ever since 2008,” Bauer said. “And not just the third quarter of this year, but the last 12 months, it’s been on a steady ascension.”
Chicago also had the third-highest number of homes repossessed by lenders during the quarter – 12,568 – behind the Phoenix metro area’s 14,317 and the Miami metro area’s 12,963, RealtyTrac said.
Banks have seized more than 816,000 homes through the first nine months of the year and are on pace to seize more than a million.
A controversy stemming from allegations that banks evicted people without reading foreclosure documents wasn’t a factor in the July-September quarter, Sharga said. Lenders such as Bank of America and Ally Financial’s GMAC Mortgage initially halted foreclosure activity but have since resumed processing foreclosures.
Preliminary data from this month shows almost no change in foreclosure activity versus September, Sharga said. “We’re not seeing what we might have anticipated in terms of a falloff,” he said.
The Las Vegas-Paradise, Nev., metropolitan area topped the list of metropolitan areas with the highest foreclosure rates in July-September with one in every 25 homes receiving a foreclosure warning – more than five times the national average. But foreclosure filings declined 20 percent from the same quarter last year.
“It’s not out of the woods yet, it’s just less bad than it was a year ago,” Sharga said.
Rounding out the rest of the top 10 metros with the highest foreclosure rate were Cape Coral-Fort Myers, Fla.; Modesto, Calif.; Stockton, Calif.; Merced, Calif.; Riverside-San Bernardino-Ontario, Calif.; Miami-Fort Lauderdale-Pompano Beach, Fla.; Phoenix-Mesa-Scottsdale, Ariz.; Bakersfield, Calif.; and Vallejo-Fairfield, Calif.
Source: The Associated Press, Alex Veiga, AP real estate writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
California, Nevada, Florida and Arizona remain the nation’s foreclosure hotbeds, accounting for 19 of the top 20 metropolitan areas with the highest foreclosure rates between July and September, foreclosure listing firm RealtyTrac Inc. said Thursday. Those states saw housing values surge during the housing boom years. When the boom ended, values collapsed and foreclosures soared.
But the latest data show that many of the metro areas in those states saw a decline in the number of households receiving foreclosure-related filings, while many cities in other states saw a spike in foreclosure activity.
“The epidemic is spreading from the states at the ground zero of the foreclosure problems out into areas that hadn’t been previously affected,” said Rick Sharga, a senior vice president at RealtyTrac.
The trend is the latest sign that the nation’s foreclosure crisis is worsening as homeowners facing high unemployment, slow job growth and uncertainty about home prices continue to fall behind on their mortgage payments.
In all, 133 out of 206 metropolitan areas with at least 200,000 residents posted an annual increase in foreclosure activity in the three months ended Sept. 30, RealtyTrac said.
The firm tracks notices for defaults, scheduled home auctions and home repossessions – warnings that can lead up to a home eventually being lost to foreclosure.
Eleven out of the nation’s 20 largest metropolitan areas saw foreclosure activity increase in the third quarter compared to the same period last year. The Seattle-Tacoma-Bellevue metro area registered the sharpest annual increase – 71 percent. One in every 129 households received a foreclosure filing.
The Chicago-Naperville-Joliet metropolitan area posted the second-highest annual jump, a 35 percent increase. One in every 84 households received a foreclosure notice.
Among the other metro areas where foreclosure activity jumped by a large margin this summer were Houston-Sugar Land-Baytown, up 26 percent; Detroit-Warren-Livonia, at nearly 23 percent; and, Atlanta-Sandy Springs-Marietta, up 20 percent.
Economic woes, such as unemployment or reduced income, continue to be the main catalysts for foreclosures this year. The U.S. unemployment rate hit 9.6 percent last month.
In the Seattle metro area, unemployment stood slightly lower at 8.5 percent in August and has been edging lower. It was 8.7 percent in August last year.
Still, many troubled homeowners have been unable to hang on. As a result, there’s been no letup in the inventory of foreclosed homes on the market this year, says John Bauer, an agent with ZipRealty in Seattle who represents lenders selling foreclosed properties.
“It has been on an upward trend curve ever since 2008,” Bauer said. “And not just the third quarter of this year, but the last 12 months, it’s been on a steady ascension.”
Chicago also had the third-highest number of homes repossessed by lenders during the quarter – 12,568 – behind the Phoenix metro area’s 14,317 and the Miami metro area’s 12,963, RealtyTrac said.
Banks have seized more than 816,000 homes through the first nine months of the year and are on pace to seize more than a million.
A controversy stemming from allegations that banks evicted people without reading foreclosure documents wasn’t a factor in the July-September quarter, Sharga said. Lenders such as Bank of America and Ally Financial’s GMAC Mortgage initially halted foreclosure activity but have since resumed processing foreclosures.
Preliminary data from this month shows almost no change in foreclosure activity versus September, Sharga said. “We’re not seeing what we might have anticipated in terms of a falloff,” he said.
The Las Vegas-Paradise, Nev., metropolitan area topped the list of metropolitan areas with the highest foreclosure rates in July-September with one in every 25 homes receiving a foreclosure warning – more than five times the national average. But foreclosure filings declined 20 percent from the same quarter last year.
“It’s not out of the woods yet, it’s just less bad than it was a year ago,” Sharga said.
Rounding out the rest of the top 10 metros with the highest foreclosure rate were Cape Coral-Fort Myers, Fla.; Modesto, Calif.; Stockton, Calif.; Merced, Calif.; Riverside-San Bernardino-Ontario, Calif.; Miami-Fort Lauderdale-Pompano Beach, Fla.; Phoenix-Mesa-Scottsdale, Ariz.; Bakersfield, Calif.; and Vallejo-Fairfield, Calif.
Source: The Associated Press, Alex Veiga, AP real estate writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Failed mortgage modifications leave homes in even more peril
Rogelio Huerta and Maria Soto did everything they were supposed to do to reduce the monthly mortgage payments on their Bellwood, Ill., home.
Facing a cash crunch because his work hours were cut, they sought help from PNC Mortgage while they were still current on their payments. At its suggestion, they met with a housing counselor who helped them get a trial loan modification, and they made all the payments on time for 13 months. They also followed the advice of housing counselors to set aside money left over, putting off home and car repairs, while they waited to learn whether their reduced payment plan would be made permanent.
This month, their application was denied, meaning their home is likely headed to foreclosure. The bank’s reasoning? The family’s $7,160 in savings, including a $5,218 income tax refund, accumulated during the year it took the bank to review the application, meant they were too well off to qualify.
“I was just following whatever they said to do,” a choked-up Huerta, the father of two young boys, said last week. “I’m not looking for something for free. I’m just looking for a payment that can save my family.”
Like Huerta, the frustrations of the past year have caused red-rimmed eyes among counselors working on their file, because they just don’t understand how a family like Huerta and Soto’s can be turned away.
“These are the very borrowers you want,” said Liz Caton, director of counseling services at the Northwest Side Housing Center in Chicago. “These are the homeowners who have jobs, who are working on budgeting and saving. It seems to be a no-brainer when you ask the question is it in (the bank’s) best interest to help this homeowner or not.”
It was with high hopes that President Barack Obama announced the Home Affordable Modification Program in early March 2009 to assist honest homeowners who were working but struggling. Almost 20 months later, the program has gone through many revisions and been labeled a failure by critics.
Huerta and Soto’s story illustrates how the best intentions of homeowners to hold up their end of an agreement can work against them in a system overwhelmed by demand and strained by capacity. In recent weeks, some of the nation’s biggest lenders have suspended foreclosures amid allegations of sloppy paperwork and legal shortcuts.
Huerta, who remained positive during the first eight months of the ordeal, has now lost all faith in the system. But he remains resolute.
“I’m not going to leave my home,” he said.
A spokesman for PNC said the bank cannot comment on a particular customer.
“PNC wants to help as many customers as possible to remain in their homes, and is committed to helping maintain mortgage affordability,” the bank said in a statement. “Since the inception of HAMP, we have significantly increased our dedicated loan modification program staffing to offer assistance to our customers. We proactively work with struggling homeowners to find a permanent solution to resolve delinquency and mitigate loss.”
In recent months, Treasury officials have urged loan servicers to speed the processing of applicants who are in “aged” trial modifications. As of August, more than 94,000 homeowners nationally were like Huerta and Soto, still waiting six months or more to hear back on their applications.
“These are the ones where people have been through the wringer,” said Laurie Maggiano, director of policy in the Treasury Department’s Homeownership Preservation Office. “We are very sympathetic to borrowers who have been dragged through the mud for many months.”
A year ago Huerta, 32, and Soto, 35, were current on the $1,541 monthly mortgage for the home they bought in 2003 for $178,000, but when his job as a machine operator was transferred to Grayslake, the increased commuting expenses cut into their savings. Then his hours were cut, from 40 hours a week to 32. Soto works as a hotel housekeeper, but only on weekends so they don’t have day care expenses.
The couple tapped their savings to pay the mortgage but Huerta knew that was a temporary fix. A PNC customer representative suggested they contact a housing counselor certified by the federal Department of Housing and Urban Development. Huerta and Soto applied for, and received, a HAMP trial modification with a payment of $948.46 that started in October 2009 and was to last for four months while their file was reviewed.
As the months stretched on, some trial payments were rejected by the bank and returned to Huerta. Each time Huerta would call the bank, and a representative would take his payment over the phone, using his debit card. Caton, their housing counselor, said her advice was, “Make your payments. It’s the bank that’s messed up, not you.”
One time as he was trying to understand one of the many letters the family received from PNC, Huerta, who is fluent in English but more comfortable speaking Spanish, asked if he could speak to a Spanish-speaking customer representative. He said he was placed on hold, listening to music, for an hour, before he finally gave up.
The strain, meanwhile, started taking a toll on the family.
The couple traditionally sat down with the boys, David, 7, and Richard, 6, at the kitchen table every night while they did homework. But on many days after work, Huerta was driving back and forth to the housing counselor’s office, taking more documents to send to PNC to prove his financial standing and need for a modification.
The good-natured father who happily coached his sons’ soccer team was replaced by a frustrated man who was aloof at home.
“They were always coming back, asking for the same information,” Soto said. “It’s hard. I see my husband break down. There’s been tears. It’s one letter after another. It has broken our family situation.”
Huerta doesn’t disagree with Soto’s assessment. “I don’t want to see nobody,” he said. “I never fight with my wife before this situation. Now we fight more. I go to my computer and sit there three, four hours. My kids playing, it just bothers me.”
Meanwhile, Huerta and Soto were afraid to spend money on needed car repairs and home maintenance. A $5,218 income tax refund went into their bank account while a broken window at their home remained unfixed.
“I was saving the money I can,” Huerta said. “My checking account started going back up.”
Said Caton, “We tell all of our homeowners, ‘You need to budget, you need to save,’ and Rogelio took it seriously.”
On Sept. 27, Huerta sent in the October trial payment, the 13th payment of its kind, and it was accepted. The rejection letter, which listed the reason for the denial as “asset review determination,” was dated Oct. 7. In follow-up conversations with PNC, counselors said they were told that if Huerta and Soto had saved about $2,500 less, a permanent modification would have been granted.
A spokeswoman for the Federal Housing Finance Agency said computer models help determine whether a borrower who is less than 60 days behind on a mortgage is in imminent danger of default.
“They aren’t the only ones who are waiting in the system for months,” Caton said. “This is not the extreme case, which is what makes counselors get frustrated. We are working with homeowners who have the ability to pay. The message is getting sent (by banks) that even though it’s in your best interest and our best interest to save money, we’re going to penalize you when you do.”
With the HAMP modification denied, unless Huerta and Soto become current on the mortgage by paying what they hadn’t paid for the past 13 months, more than $7,700, as well as their regular mortgage payment, they will default on the loan and the bank can initiate foreclosure proceedings.
On Oct. 15, a PNC customer representative called Huerta and said he was sending another packet of unspecified paperwork for Huerta and Soto to fill out and return before the week of Nov. 14, when the home would be put into foreclosure.
On Friday, a week later, Huerta and Soto were still waiting for that packet to arrive.
Source: Chicago Tribune. Distributed by McClatchy-Tribune Information Services.
Facing a cash crunch because his work hours were cut, they sought help from PNC Mortgage while they were still current on their payments. At its suggestion, they met with a housing counselor who helped them get a trial loan modification, and they made all the payments on time for 13 months. They also followed the advice of housing counselors to set aside money left over, putting off home and car repairs, while they waited to learn whether their reduced payment plan would be made permanent.
This month, their application was denied, meaning their home is likely headed to foreclosure. The bank’s reasoning? The family’s $7,160 in savings, including a $5,218 income tax refund, accumulated during the year it took the bank to review the application, meant they were too well off to qualify.
“I was just following whatever they said to do,” a choked-up Huerta, the father of two young boys, said last week. “I’m not looking for something for free. I’m just looking for a payment that can save my family.”
Like Huerta, the frustrations of the past year have caused red-rimmed eyes among counselors working on their file, because they just don’t understand how a family like Huerta and Soto’s can be turned away.
“These are the very borrowers you want,” said Liz Caton, director of counseling services at the Northwest Side Housing Center in Chicago. “These are the homeowners who have jobs, who are working on budgeting and saving. It seems to be a no-brainer when you ask the question is it in (the bank’s) best interest to help this homeowner or not.”
It was with high hopes that President Barack Obama announced the Home Affordable Modification Program in early March 2009 to assist honest homeowners who were working but struggling. Almost 20 months later, the program has gone through many revisions and been labeled a failure by critics.
Huerta and Soto’s story illustrates how the best intentions of homeowners to hold up their end of an agreement can work against them in a system overwhelmed by demand and strained by capacity. In recent weeks, some of the nation’s biggest lenders have suspended foreclosures amid allegations of sloppy paperwork and legal shortcuts.
Huerta, who remained positive during the first eight months of the ordeal, has now lost all faith in the system. But he remains resolute.
“I’m not going to leave my home,” he said.
A spokesman for PNC said the bank cannot comment on a particular customer.
“PNC wants to help as many customers as possible to remain in their homes, and is committed to helping maintain mortgage affordability,” the bank said in a statement. “Since the inception of HAMP, we have significantly increased our dedicated loan modification program staffing to offer assistance to our customers. We proactively work with struggling homeowners to find a permanent solution to resolve delinquency and mitigate loss.”
In recent months, Treasury officials have urged loan servicers to speed the processing of applicants who are in “aged” trial modifications. As of August, more than 94,000 homeowners nationally were like Huerta and Soto, still waiting six months or more to hear back on their applications.
“These are the ones where people have been through the wringer,” said Laurie Maggiano, director of policy in the Treasury Department’s Homeownership Preservation Office. “We are very sympathetic to borrowers who have been dragged through the mud for many months.”
A year ago Huerta, 32, and Soto, 35, were current on the $1,541 monthly mortgage for the home they bought in 2003 for $178,000, but when his job as a machine operator was transferred to Grayslake, the increased commuting expenses cut into their savings. Then his hours were cut, from 40 hours a week to 32. Soto works as a hotel housekeeper, but only on weekends so they don’t have day care expenses.
The couple tapped their savings to pay the mortgage but Huerta knew that was a temporary fix. A PNC customer representative suggested they contact a housing counselor certified by the federal Department of Housing and Urban Development. Huerta and Soto applied for, and received, a HAMP trial modification with a payment of $948.46 that started in October 2009 and was to last for four months while their file was reviewed.
As the months stretched on, some trial payments were rejected by the bank and returned to Huerta. Each time Huerta would call the bank, and a representative would take his payment over the phone, using his debit card. Caton, their housing counselor, said her advice was, “Make your payments. It’s the bank that’s messed up, not you.”
One time as he was trying to understand one of the many letters the family received from PNC, Huerta, who is fluent in English but more comfortable speaking Spanish, asked if he could speak to a Spanish-speaking customer representative. He said he was placed on hold, listening to music, for an hour, before he finally gave up.
The strain, meanwhile, started taking a toll on the family.
The couple traditionally sat down with the boys, David, 7, and Richard, 6, at the kitchen table every night while they did homework. But on many days after work, Huerta was driving back and forth to the housing counselor’s office, taking more documents to send to PNC to prove his financial standing and need for a modification.
The good-natured father who happily coached his sons’ soccer team was replaced by a frustrated man who was aloof at home.
“They were always coming back, asking for the same information,” Soto said. “It’s hard. I see my husband break down. There’s been tears. It’s one letter after another. It has broken our family situation.”
Huerta doesn’t disagree with Soto’s assessment. “I don’t want to see nobody,” he said. “I never fight with my wife before this situation. Now we fight more. I go to my computer and sit there three, four hours. My kids playing, it just bothers me.”
Meanwhile, Huerta and Soto were afraid to spend money on needed car repairs and home maintenance. A $5,218 income tax refund went into their bank account while a broken window at their home remained unfixed.
“I was saving the money I can,” Huerta said. “My checking account started going back up.”
Said Caton, “We tell all of our homeowners, ‘You need to budget, you need to save,’ and Rogelio took it seriously.”
On Sept. 27, Huerta sent in the October trial payment, the 13th payment of its kind, and it was accepted. The rejection letter, which listed the reason for the denial as “asset review determination,” was dated Oct. 7. In follow-up conversations with PNC, counselors said they were told that if Huerta and Soto had saved about $2,500 less, a permanent modification would have been granted.
A spokeswoman for the Federal Housing Finance Agency said computer models help determine whether a borrower who is less than 60 days behind on a mortgage is in imminent danger of default.
“They aren’t the only ones who are waiting in the system for months,” Caton said. “This is not the extreme case, which is what makes counselors get frustrated. We are working with homeowners who have the ability to pay. The message is getting sent (by banks) that even though it’s in your best interest and our best interest to save money, we’re going to penalize you when you do.”
With the HAMP modification denied, unless Huerta and Soto become current on the mortgage by paying what they hadn’t paid for the past 13 months, more than $7,700, as well as their regular mortgage payment, they will default on the loan and the bank can initiate foreclosure proceedings.
On Oct. 15, a PNC customer representative called Huerta and said he was sending another packet of unspecified paperwork for Huerta and Soto to fill out and return before the week of Nov. 14, when the home would be put into foreclosure.
On Friday, a week later, Huerta and Soto were still waiting for that packet to arrive.
Source: Chicago Tribune. Distributed by McClatchy-Tribune Information Services.
Wednesday, October 27, 2010
Apps Let Road Warriors "Hear" E-mail and Drive
More than a dozen apps are now available for smartphones that will read your e-mail messages to you and let you reply with your voice --safely -- while you drive. These apps work with most Web providers (Gmail, AOL, Hotmail and MobileMe) and are compatible with all mobile carriers.
With millions of mobile workers commuting to and from the office each day and looking to remain productive while behind the wheel, software developers are tapping into the power of smartphone applications ("apps") that let you access e-mail, and in some cases, allow you to respond hands-free, too.
IncTechnology.com has written about hardware options for e-mailing while driving in the past, but downloadable software -- that won't break the bank and works with existing smartphones and carriers -- might be a preferred way to go for on-the-go businesspeople.
These apps rely on text-to-speech technology to read messages to you in a human-like voice, while replies are attached as an audio clip or transcribed back into text before sent.
Read your e-mails
iSpeech.Org's DriveSafe.ly, for example, can read your incoming e-mails and text messages to those running BlackBerry, iPhone, Android, or Windows Mobile devices. The sender also gets an automated reply to confirm the message has been received. The free version reads the first 25 words of the message, but upgrading to the Pro version ($30) gives you the first 500 words of a message, the choice of female or male voice, and other benefits.
Similarly, the free Text'nDrive app for BlackBerry or iPhone (and soon, Android) also allows you to listen to your incoming messages, but the Pro version ($10) also gives you the option to reply to messages with your voice. This app from Hands Free Software can automatically configure Gmail, Hotmail, AOL, and MobileMe user accounts, while those with other e-mail accounts might need to first input some info, such as POP or IMAP settings and SMTP settings.
Critics speak up
Carmi Levy, an independent technology analyst based in London, Ontario, says the safety factor is something businesses must consider before rolling out these apps to their employees. "While these new apps hold the promise of maintaining productivity while on the go, they ignore the basic fact that even hands-free communication at the wheel can be a dangerous proposition," says Levy. "Even if these apps free drivers from the illegal tyranny of texting with one hand and driving with the other, they nevertheless serve as a distraction by splitting the driver's focus between the road and his or her work."
Scott Steinberg, CEO and lead technology analyst for TechSavvy Global in Seattle, Wash., agrees with Levy. "Any distraction while on the road takes away from your concentration, but this is better than holding the phone up to your ear, which also may be illegal in your state, and certainly safer than texting or e-mailing while driving," says Steinberg.
Steinberg says while not perfect -- as they might pick up noise from the road -- these apps do a "pretty good job." "That said, hearing your e-mails is fine, but those send out replies will still need to double-check messages if they've been transcribed into text to ensure it's accurate," advises Steinberg.
Levy says these apps work as advertised for the most part, but as with many mobile solutions, some devices are better than others at supporting interactive voice sessions in a noisy vehicle. "If your particular phone's speakerphone capability is limited to begin with, these apps won't magically fix it," cautions Levy. "In many cases, Bluetooth headsets or in-car speakerphone solutions might improve the back-and-forth speech capability."
Network support is another issue, Levy says, as services which work flawlessly in an area with strong wireless coverage may fail miserably if you drive into a rural 3G dead zone.
Security and privacy concerns
Unlike DriveSafe.ly, Text'nDrive requires users to divulge their e-mail password, which might concern some.
"The security risk from sharing your e-mail password with a third party is no greater with these apps than with any other," believes Levy.
"It's common for us to share e-mail addresses for our Web-based accounts with a range of third-party apps and services -- this is no different, and as long as the company is legitimately trustworthy, users can proceed without concern that their passwords will be stolen and their accounts hacked,"
Source: Marc Saltzman, INC
With millions of mobile workers commuting to and from the office each day and looking to remain productive while behind the wheel, software developers are tapping into the power of smartphone applications ("apps") that let you access e-mail, and in some cases, allow you to respond hands-free, too.
IncTechnology.com has written about hardware options for e-mailing while driving in the past, but downloadable software -- that won't break the bank and works with existing smartphones and carriers -- might be a preferred way to go for on-the-go businesspeople.
These apps rely on text-to-speech technology to read messages to you in a human-like voice, while replies are attached as an audio clip or transcribed back into text before sent.
Read your e-mails
iSpeech.Org's DriveSafe.ly, for example, can read your incoming e-mails and text messages to those running BlackBerry, iPhone, Android, or Windows Mobile devices. The sender also gets an automated reply to confirm the message has been received. The free version reads the first 25 words of the message, but upgrading to the Pro version ($30) gives you the first 500 words of a message, the choice of female or male voice, and other benefits.
Similarly, the free Text'nDrive app for BlackBerry or iPhone (and soon, Android) also allows you to listen to your incoming messages, but the Pro version ($10) also gives you the option to reply to messages with your voice. This app from Hands Free Software can automatically configure Gmail, Hotmail, AOL, and MobileMe user accounts, while those with other e-mail accounts might need to first input some info, such as POP or IMAP settings and SMTP settings.
Critics speak up
Carmi Levy, an independent technology analyst based in London, Ontario, says the safety factor is something businesses must consider before rolling out these apps to their employees. "While these new apps hold the promise of maintaining productivity while on the go, they ignore the basic fact that even hands-free communication at the wheel can be a dangerous proposition," says Levy. "Even if these apps free drivers from the illegal tyranny of texting with one hand and driving with the other, they nevertheless serve as a distraction by splitting the driver's focus between the road and his or her work."
Scott Steinberg, CEO and lead technology analyst for TechSavvy Global in Seattle, Wash., agrees with Levy. "Any distraction while on the road takes away from your concentration, but this is better than holding the phone up to your ear, which also may be illegal in your state, and certainly safer than texting or e-mailing while driving," says Steinberg.
Steinberg says while not perfect -- as they might pick up noise from the road -- these apps do a "pretty good job." "That said, hearing your e-mails is fine, but those send out replies will still need to double-check messages if they've been transcribed into text to ensure it's accurate," advises Steinberg.
Levy says these apps work as advertised for the most part, but as with many mobile solutions, some devices are better than others at supporting interactive voice sessions in a noisy vehicle. "If your particular phone's speakerphone capability is limited to begin with, these apps won't magically fix it," cautions Levy. "In many cases, Bluetooth headsets or in-car speakerphone solutions might improve the back-and-forth speech capability."
Network support is another issue, Levy says, as services which work flawlessly in an area with strong wireless coverage may fail miserably if you drive into a rural 3G dead zone.
Security and privacy concerns
Unlike DriveSafe.ly, Text'nDrive requires users to divulge their e-mail password, which might concern some.
"The security risk from sharing your e-mail password with a third party is no greater with these apps than with any other," believes Levy.
"It's common for us to share e-mail addresses for our Web-based accounts with a range of third-party apps and services -- this is no different, and as long as the company is legitimately trustworthy, users can proceed without concern that their passwords will be stolen and their accounts hacked,"
Source: Marc Saltzman, INC
SW Fla. charity will gut homes with Chinese drywall
Habitat for Humanity of Lee County is facing a $750,000 bill to gut at least 24 homes built with defective Chinese drywall and relocate the residents.
Habitat President and CEO Katherine Green says the homes were built between 2006 and 2009 in Lehigh Acres, Cape Coral, North Fort Myers and Bonita Springs.
Green says the drywall was donated through Habitat’s international headquarters in 2006.
The renovations will begin in November.
Defective Chinese drywall has been linked to problems ranging from a foul odor to corrosion of pipes and wiring. Some residents of homes with the material have reported health problems.
Source: 2010 The Associated Press.
Habitat President and CEO Katherine Green says the homes were built between 2006 and 2009 in Lehigh Acres, Cape Coral, North Fort Myers and Bonita Springs.
Green says the drywall was donated through Habitat’s international headquarters in 2006.
The renovations will begin in November.
Defective Chinese drywall has been linked to problems ranging from a foul odor to corrosion of pipes and wiring. Some residents of homes with the material have reported health problems.
Source: 2010 The Associated Press.
Property values nationally show slight dip
National home prices continue to look stable on average. According to a report by real estate analyst CoreLogic, home prices, excluding distressed sales, declined only 0.4 percent in August 2010 compared to one year earlier.
The difference in home prices from the market’s peak in April 2006 to August 2010 is 19.6 percent if distressed properties are not included in the calculations. Adding in the distressed transactions, the peak to current decline in the national home price index is -28.2 percent.
Some 78 out of 100 metropolitan areas experienced price declines in August, up from 58 in July.
The five states with the highest appreciation in August, including distressed sales, are:
• Maine, + 5.8 percent
• New York, +3.7 percent
• Connecticut, +2.5 percent
• Virginia, +2.4 percent
• South Dakota, +2.1 percent
The five states with the greatest depreciation in August, including distressed sales, are:
• Idaho, -14 percent
• Alabama, -10.4 percent
• Utah, -7.3 percent
• Oregon, -6.3 percent
• Florida, - 6.2 percent
Excluding distressed sales, the five states with highest August appreciation are:
· New York, +5 percent
· South Dakota, +4 percent
· Connecticut, +3.1 percent
· North Dakota, +3 percent
· Vermont, +2.7 percent
Excluding distressed sales, the five states with the greatest August depreciation were:
• Idaho, - 11.3 percent
• Michigan, -7.6 percent
• Arizona, -6.5 percent
• Nevada, -6.3 percent
• Utah, -4.7 percent
Source: CoreLogic (10/25/2010)
Source: INFORMATION, INC. Bethesda, MD
The difference in home prices from the market’s peak in April 2006 to August 2010 is 19.6 percent if distressed properties are not included in the calculations. Adding in the distressed transactions, the peak to current decline in the national home price index is -28.2 percent.
Some 78 out of 100 metropolitan areas experienced price declines in August, up from 58 in July.
The five states with the highest appreciation in August, including distressed sales, are:
• Maine, + 5.8 percent
• New York, +3.7 percent
• Connecticut, +2.5 percent
• Virginia, +2.4 percent
• South Dakota, +2.1 percent
The five states with the greatest depreciation in August, including distressed sales, are:
• Idaho, -14 percent
• Alabama, -10.4 percent
• Utah, -7.3 percent
• Oregon, -6.3 percent
• Florida, - 6.2 percent
Excluding distressed sales, the five states with highest August appreciation are:
· New York, +5 percent
· South Dakota, +4 percent
· Connecticut, +3.1 percent
· North Dakota, +3 percent
· Vermont, +2.7 percent
Excluding distressed sales, the five states with the greatest August depreciation were:
• Idaho, - 11.3 percent
• Michigan, -7.6 percent
• Arizona, -6.5 percent
• Nevada, -6.3 percent
• Utah, -4.7 percent
Source: CoreLogic (10/25/2010)
Source: INFORMATION, INC. Bethesda, MD
New home sales rise 6.6% after dismal summer
Sales of new U.S. homes improved last month after the worst summer in nearly five decades, but not enough to lift the struggling economy.
The Commerce Department says new home sales in September grew 6.6 percent from a month earlier to a seasonally adjusted annual sales pace of 307,000. The increase follows a stretch where three of the past four months were the slowest on records dating back to 1963.
High unemployment, tight credit and uncertainty about home prices have kept people from buying homes. Government tax credits propelled the market earlier in the year, but those expired in April.
The median sales price was $223,800. That was up 3.3 percent from a year earlier.
Source: The Associated Press, Alan Zibel, AP real estate writer.
The Commerce Department says new home sales in September grew 6.6 percent from a month earlier to a seasonally adjusted annual sales pace of 307,000. The increase follows a stretch where three of the past four months were the slowest on records dating back to 1963.
High unemployment, tight credit and uncertainty about home prices have kept people from buying homes. Government tax credits propelled the market earlier in the year, but those expired in April.
The median sales price was $223,800. That was up 3.3 percent from a year earlier.
Source: The Associated Press, Alan Zibel, AP real estate writer.
5 ways to cheat Facebook and Twitter time suck
We all love Facebook and Twitter -- they've quickly become a global sensation. The problem is that so many real estate agents feel overwhelmed by how much time they should spend on "social" media.
While many of us use it for fun, the business application of it is becoming increasingly more important. And like everything in business, time is money. So how do you create a plan to keep social media from taking over your life?
Here's how I use social media for work without losing my mind:
1. Schedule a "work" time for Facebook and Twitter interaction. For instance, I check my accounts for about 5 minutes at the start of the day, another 5 minutes around lunchtime, and one last check at the end of the work day. During this time I focus intently on scrolling through the feeds and make brief comments or "Likes." Also, make sure to always shout out birthdays! One of these sessions is actually closer to 20 minutes and in the next step you'll find out why.
2. I use Hootsuite, which is a great social networking app that allows you to not only see multiple Twitter and Facebook "streams" on the same screen. It also allows you to autopost tweets. This way I can schedule posts for later in the evening and the next day that are timely. (There are many other applications that do similar things, I just happen to like the Hootsuite app and it's easy to use on my iPhone.)
3. Facebook and Twitter allow you to link your accounts so that if you post on one it will automatically update the other. Personally, I suggest linking Facebook to your Twitter, but I am not a fan of linking Twitter to Facebook if you post a lot on Twitter. Why?
Because most people who use Twitter engage in multiple conversations and post multiple times per day and this will quickly get distracting (and annoying) for your Facebook friends who don't know what you are referring to.
4. Reading the links to stories on Facebook and Twitter takes time. I e-mail them to myself to read at a specified time (I do mine around lunchtime and I set aside about 30 minutes for this task). If an article is worth sharing with my followers, then I can retweet it or post it the next time I am scheduled for a social media time. Another perk: Some of the articles can provide great inspiration or support for a blog post!
5. I think the biggest problem is that it can be fun to "play" on Facebook and Twitter. Why else would these websites be so popular? There's no problem with "playing," just make sure to do it during nonworking hours. Otherwise it will be counterproductive.
There's no doubt that using social media is a great way for real estate agents to keep up with clients and prospects as well as share real estate and community news and information. These platforms are perfect because agents do need to think about marketing and advertising plans.
Facebook and Twitter are free and easy ways to reach your audience. However, like I said above, time is money. Using these steps should help you manage your time so you can focus on making the deals that lead to paydays!
What are some of your steps for managing social media?
Source: Inman News,
While many of us use it for fun, the business application of it is becoming increasingly more important. And like everything in business, time is money. So how do you create a plan to keep social media from taking over your life?
Here's how I use social media for work without losing my mind:
1. Schedule a "work" time for Facebook and Twitter interaction. For instance, I check my accounts for about 5 minutes at the start of the day, another 5 minutes around lunchtime, and one last check at the end of the work day. During this time I focus intently on scrolling through the feeds and make brief comments or "Likes." Also, make sure to always shout out birthdays! One of these sessions is actually closer to 20 minutes and in the next step you'll find out why.
2. I use Hootsuite, which is a great social networking app that allows you to not only see multiple Twitter and Facebook "streams" on the same screen. It also allows you to autopost tweets. This way I can schedule posts for later in the evening and the next day that are timely. (There are many other applications that do similar things, I just happen to like the Hootsuite app and it's easy to use on my iPhone.)
3. Facebook and Twitter allow you to link your accounts so that if you post on one it will automatically update the other. Personally, I suggest linking Facebook to your Twitter, but I am not a fan of linking Twitter to Facebook if you post a lot on Twitter. Why?
Because most people who use Twitter engage in multiple conversations and post multiple times per day and this will quickly get distracting (and annoying) for your Facebook friends who don't know what you are referring to.
4. Reading the links to stories on Facebook and Twitter takes time. I e-mail them to myself to read at a specified time (I do mine around lunchtime and I set aside about 30 minutes for this task). If an article is worth sharing with my followers, then I can retweet it or post it the next time I am scheduled for a social media time. Another perk: Some of the articles can provide great inspiration or support for a blog post!
5. I think the biggest problem is that it can be fun to "play" on Facebook and Twitter. Why else would these websites be so popular? There's no problem with "playing," just make sure to do it during nonworking hours. Otherwise it will be counterproductive.
There's no doubt that using social media is a great way for real estate agents to keep up with clients and prospects as well as share real estate and community news and information. These platforms are perfect because agents do need to think about marketing and advertising plans.
Facebook and Twitter are free and easy ways to reach your audience. However, like I said above, time is money. Using these steps should help you manage your time so you can focus on making the deals that lead to paydays!
What are some of your steps for managing social media?
Source: Inman News,
Tuesday, October 26, 2010
Out-of-state listings dispute draws lawsuits
Some real estate brokers offer to add a listing to Realtor.com for a flat fee, doing so while still following rules by placing them into an MLS in a different state.
However, that system is being tested in court. Real estate brokers who work with sites like ForSaleByOwner.com to place flat-fee listings on Realtor.com could find themselves at loggerheads with state regulators if they accept listings from states where they’re not licensed.
Litigation in Nebraska and Alaska involves California broker Leslie Rae Young, who has received cease-and-desist orders for allegedly violating real estate licensing laws. Young advertises properties from Nebraska and Alaska on Realtor.com by placing them in a Multiple Listing Service (MLS) in another state.
So far, Young has argued that Alaska’s definition of a real estate listing is broad, insisting that she merely provides advertising services but does not handle negotiations, sales or closings; therefore, she does not need a license to do business in the state.
While Administrative Law Judge Christopher Kennedy acknowledged that Young has no control over language used by Realtor.com, such as “This listing brokered by,” “agent’s other listings,” and “e-mail agent,” he emphasized that her business model would necessitate a real estate license in Alaska.
Young works with ForSaleByOwner.com, which pays brokers a flat fee to enter listing information in MLSs outside the seller’s market. The National Association of Realtors’ model MLS policy says that brokers can accept MLS entry-only listings in accordance with state law, but some agents are concerned that MLSs will start to restrict geographic areas in which they will accept listings.
Source: Inman News (10/25/10) Carter, Matt
Source: INFORMATION, INC. Bethesda, MD
However, that system is being tested in court. Real estate brokers who work with sites like ForSaleByOwner.com to place flat-fee listings on Realtor.com could find themselves at loggerheads with state regulators if they accept listings from states where they’re not licensed.
Litigation in Nebraska and Alaska involves California broker Leslie Rae Young, who has received cease-and-desist orders for allegedly violating real estate licensing laws. Young advertises properties from Nebraska and Alaska on Realtor.com by placing them in a Multiple Listing Service (MLS) in another state.
So far, Young has argued that Alaska’s definition of a real estate listing is broad, insisting that she merely provides advertising services but does not handle negotiations, sales or closings; therefore, she does not need a license to do business in the state.
While Administrative Law Judge Christopher Kennedy acknowledged that Young has no control over language used by Realtor.com, such as “This listing brokered by,” “agent’s other listings,” and “e-mail agent,” he emphasized that her business model would necessitate a real estate license in Alaska.
Young works with ForSaleByOwner.com, which pays brokers a flat fee to enter listing information in MLSs outside the seller’s market. The National Association of Realtors’ model MLS policy says that brokers can accept MLS entry-only listings in accordance with state law, but some agents are concerned that MLSs will start to restrict geographic areas in which they will accept listings.
Source: Inman News (10/25/10) Carter, Matt
Source: INFORMATION, INC. Bethesda, MD
Capture leads through a ‘squeeze page’
Squeeze pages” are clean single web pages that convey a specific message designed to capture leads.
Real estate agents can create squeeze pages focused on specific properties, such as foreclosures, townhomes, upscale dwellings, golf homes or eco-friendly homes. Squeeze pages also can be used to target short-sale sellers or to provide a free report with progressive marketing ideas.
However, some experts warn, squeeze pages cannot take the place of a traditional web site. They work best as a specialty page targeted so tightly that the user feels compelled to contact the Realtor.
Source: RISMedia (10/25/10) Schoenly, Josh; Hartman, Ryan
Real estate agents can create squeeze pages focused on specific properties, such as foreclosures, townhomes, upscale dwellings, golf homes or eco-friendly homes. Squeeze pages also can be used to target short-sale sellers or to provide a free report with progressive marketing ideas.
However, some experts warn, squeeze pages cannot take the place of a traditional web site. They work best as a specialty page targeted so tightly that the user feels compelled to contact the Realtor.
Source: RISMedia (10/25/10) Schoenly, Josh; Hartman, Ryan
Homeowners’ Robin Hood fights foreclosure giants
Tom Ice was a desert boy who wanted to be Jacques Cousteau. He earned the degree and everything, leaving his home in Santa Fe, N.M., to study ocean engineering at the University of Miami.
But the former high school debater had an inexplicable change of heart, one that led him from the rhythmic comfort of the ocean to the tense arguments of the courtroom.
Ice, 50, has emerged as a Robin Hood of sorts in the tangled world of foreclosures, representing homeowners and fighting powerful law firms backed by big banks.
From his West Palm Beach home – he doesn’t have an office at his firm in Royal Palm Beach – Ice’s legal wrangling is largely recognized for contributing to the nationwide suspension of foreclosures enacted by several major lenders. On Wednesday, attorneys general from every state launched a nationwide probe of loan servicers.
Ice credits his engineering background for his attention to detail and years of litigating for his tenacity. He was trained, he said, to doubt everything the other side says and “look under every rock.”
What he and his wife, Ariane, found buried under boulders of foreclosure paperwork were backdated documents, affidavits sworn to by bank employees processing thousands of foreclosures a month, and questionable assignments of mortgages coming out of the Mortgage Electronic Registration System, or MERS.
After the discoveries, Ice did what any good litigator would do: He asked to depose employees involved in creating the documents.
Then he made the unusual move of posting the depositions on his website, a strategy he credits for much of the snowball of foreclosure suspensions.
“None of this could have occurred without an exchange of information,” said Matt Weidner, a St. Petersburg foreclosure defense attorney. “Ice was absolutely instrumental and an essential key.”
Ice believes his firm was the first to depose GMAC Mortgage employee Jeffrey Stephan.
Stephan was one of the first identified “robo-signers,” attesting to the veracity of 10,000 foreclosure affidavits a month and swearing to the impossible feat of personally reviewing support documentation on each.
GMAC, renamed Ally Financial Inc., announced last month it was suspending some foreclosures. JPMorgan Chase, Bank of America, Litton Loan Servicing and PNC Financial Services Group followed.
“We’ve studied this for two years and I fear we are just scratching the surface,” Ice said. “It is a rabbit hole.”
Ice, who has been quoted by major U.S. newspapers about his foreclosure work, never expected to be a foreclosure attorney. For most of his 25 years practicing law, he has worked for large firms defending corporations.
But about 2 1/2 years ago, Ice, who has an 8-year-old son, decided to go out on his own, opening a one-man bankruptcy firm. He soon realized he could better help his clients by defending foreclosures in state court.
“The real estate attorneys would get an affidavit and say, ‘OK, I guess we lose,’ “ Ice said. “My thing was to say, ‘Well, let’s take a deposition and file for discovery.’”
Ice Legal, where the motto is “Your home is your castle, defend it,” now has seven attorneys working mostly on foreclosure cases.
Riviera Beach resident Barbara Williams, 57, has been an Ice Legal client since 2008, when a work injury and subsequent income reduction led her into foreclosure.
Williams, a licensed practical nurse, said she’s hoping to work out a new payment agreement with her bank.
“I don’t feel like they are just doing something to make a buck,” Williams said of Ice Legal. “I am very confident they are doing everything for my benefit and giving it 100 percent.”
Ice has 400 active clients and said he has lost only a handful of cases. He admits to workaholic hours, describing himself as an early riser and an insomniac.
“It was hard to get people to take us seriously in the beginning,” Ice said.
He has undoubtedly stepped on toes.
He filed more than 100 motions to disqualify Palm Beach County foreclosure Judge Meenu Sasser, alleging she was biased against his attorneys and gave preferential treatment to lenders.
Several of the cases in which Sasser denied his motion to disqualify her went to the 4th District Court of Appeal. The appeals court sided with the judge, saying in one case that Ice seemed intent on frustrating the “efficient function of the foreclosure division.”
West Palm Beach attorney Gerald Richman of Richman Greer, P.A., has complained in general about foreclosure defense attorneys using questionable tactics to stall cases.
“If someone is clearly in default and really doesn’t have a valid defense, it’s wrong to go ahead and drag a case on,” Richman said. “Some defense lawyers are basically creating issues to delay for delay’s sake.”
But Ice said forging signatures, as is alleged to have occurred at one South Florida foreclosure law firm, and swearing to things that aren’t true are fraud upon the court that should be exposed.
“Just because the bank says they own your home doesn’t mean they do,” Ice said. “For too long, people were just hoping no one would look behind the curtain.”
Source: The Associated Press, Kimberly Miller. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
But the former high school debater had an inexplicable change of heart, one that led him from the rhythmic comfort of the ocean to the tense arguments of the courtroom.
Ice, 50, has emerged as a Robin Hood of sorts in the tangled world of foreclosures, representing homeowners and fighting powerful law firms backed by big banks.
From his West Palm Beach home – he doesn’t have an office at his firm in Royal Palm Beach – Ice’s legal wrangling is largely recognized for contributing to the nationwide suspension of foreclosures enacted by several major lenders. On Wednesday, attorneys general from every state launched a nationwide probe of loan servicers.
Ice credits his engineering background for his attention to detail and years of litigating for his tenacity. He was trained, he said, to doubt everything the other side says and “look under every rock.”
What he and his wife, Ariane, found buried under boulders of foreclosure paperwork were backdated documents, affidavits sworn to by bank employees processing thousands of foreclosures a month, and questionable assignments of mortgages coming out of the Mortgage Electronic Registration System, or MERS.
After the discoveries, Ice did what any good litigator would do: He asked to depose employees involved in creating the documents.
Then he made the unusual move of posting the depositions on his website, a strategy he credits for much of the snowball of foreclosure suspensions.
“None of this could have occurred without an exchange of information,” said Matt Weidner, a St. Petersburg foreclosure defense attorney. “Ice was absolutely instrumental and an essential key.”
Ice believes his firm was the first to depose GMAC Mortgage employee Jeffrey Stephan.
Stephan was one of the first identified “robo-signers,” attesting to the veracity of 10,000 foreclosure affidavits a month and swearing to the impossible feat of personally reviewing support documentation on each.
GMAC, renamed Ally Financial Inc., announced last month it was suspending some foreclosures. JPMorgan Chase, Bank of America, Litton Loan Servicing and PNC Financial Services Group followed.
“We’ve studied this for two years and I fear we are just scratching the surface,” Ice said. “It is a rabbit hole.”
Ice, who has been quoted by major U.S. newspapers about his foreclosure work, never expected to be a foreclosure attorney. For most of his 25 years practicing law, he has worked for large firms defending corporations.
But about 2 1/2 years ago, Ice, who has an 8-year-old son, decided to go out on his own, opening a one-man bankruptcy firm. He soon realized he could better help his clients by defending foreclosures in state court.
“The real estate attorneys would get an affidavit and say, ‘OK, I guess we lose,’ “ Ice said. “My thing was to say, ‘Well, let’s take a deposition and file for discovery.’”
Ice Legal, where the motto is “Your home is your castle, defend it,” now has seven attorneys working mostly on foreclosure cases.
Riviera Beach resident Barbara Williams, 57, has been an Ice Legal client since 2008, when a work injury and subsequent income reduction led her into foreclosure.
Williams, a licensed practical nurse, said she’s hoping to work out a new payment agreement with her bank.
“I don’t feel like they are just doing something to make a buck,” Williams said of Ice Legal. “I am very confident they are doing everything for my benefit and giving it 100 percent.”
Ice has 400 active clients and said he has lost only a handful of cases. He admits to workaholic hours, describing himself as an early riser and an insomniac.
“It was hard to get people to take us seriously in the beginning,” Ice said.
He has undoubtedly stepped on toes.
He filed more than 100 motions to disqualify Palm Beach County foreclosure Judge Meenu Sasser, alleging she was biased against his attorneys and gave preferential treatment to lenders.
Several of the cases in which Sasser denied his motion to disqualify her went to the 4th District Court of Appeal. The appeals court sided with the judge, saying in one case that Ice seemed intent on frustrating the “efficient function of the foreclosure division.”
West Palm Beach attorney Gerald Richman of Richman Greer, P.A., has complained in general about foreclosure defense attorneys using questionable tactics to stall cases.
“If someone is clearly in default and really doesn’t have a valid defense, it’s wrong to go ahead and drag a case on,” Richman said. “Some defense lawyers are basically creating issues to delay for delay’s sake.”
But Ice said forging signatures, as is alleged to have occurred at one South Florida foreclosure law firm, and swearing to things that aren’t true are fraud upon the court that should be exposed.
“Just because the bank says they own your home doesn’t mean they do,” Ice said. “For too long, people were just hoping no one would look behind the curtain.”
Source: The Associated Press, Kimberly Miller. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Fewer get modified mortgage
The number of struggling homeowners who cut their mortgage payments in September through an Obama administration initiative fell to its lowest level in nearly a year, increasing debate about the program’s effectiveness.
Nearly 28,000 homeowners reached agreements with mortgage servicers last month to permanently modify mortgages under the Home Affordable Modification Program (HAMP), a government report Monday shows. That’s down from the record 68,000 modifications in April and the lowest number since November, shortly after HAMP launched.
“HAMP has been to date a disappointment,” said Moody Analytics’ chief economist Mark Zandi, adding that it is “set to fall well short of expectations.”
Joel Naroff of Naroff Economic Advisors said he is “totally baffled” by the decline. “It’s not as if the need has dropped.”
HAMP aims to reduce mortgage payments for up to 4 million homeowners. As of Sept. 30, 467,000 people had permanently lowered their payments through HAMP, Monday’s Treasury report shows.
Timothy Massad, Treasury’s acting assistant secretary for financial stability, said HAMP is encouraging lenders to modify mortgages on their own. “We’ve seen the industry emulate a lot of the HAMP standards in their own proprietary (mortgage) modifications,” Massad said. “We’re having an effect on avoiding foreclosures.”
HAMP encourages mortgage servicers to take steps such as lowering a homeowner’s interest rate or reducing mortgage principal. Homeowners first get temporary modifications that last at least three months and can receive a permanent modification if the trial succeeds.
A large number of homeowners applied in the program’s early months, which led to a surge in permanent modifications from January to June as Treasury officials processed a backlog, Massad said. Applicants have since leveled off, which accounts for the drop in permanent modifications, Massad said.
Massad noted that 11 percent of homeowners in HAMP had defaulted on their modified mortgages, a figure he called “very good. The vast majority of people in permanent modifications are staying in them.”
But the foreclosure problem remains “incredibly complex,” and HAMP has been “a work in progress” with program changes that have made it difficult for servicers to implement, Zandi said.
The report Monday said Bank of America took 73 seconds to answer HAMP-related calls in August, well above the 5.5-second average call-response time.
“We’re disappointed,” bank spokesman Roger Simon said, calling August a “high-volume month.”
He said its response time through mid-September is “down considerably.”
Source: 2010 USA TODAY, a division of Gannett Co. Inc., Thomas Frank.
Nearly 28,000 homeowners reached agreements with mortgage servicers last month to permanently modify mortgages under the Home Affordable Modification Program (HAMP), a government report Monday shows. That’s down from the record 68,000 modifications in April and the lowest number since November, shortly after HAMP launched.
“HAMP has been to date a disappointment,” said Moody Analytics’ chief economist Mark Zandi, adding that it is “set to fall well short of expectations.”
Joel Naroff of Naroff Economic Advisors said he is “totally baffled” by the decline. “It’s not as if the need has dropped.”
HAMP aims to reduce mortgage payments for up to 4 million homeowners. As of Sept. 30, 467,000 people had permanently lowered their payments through HAMP, Monday’s Treasury report shows.
Timothy Massad, Treasury’s acting assistant secretary for financial stability, said HAMP is encouraging lenders to modify mortgages on their own. “We’ve seen the industry emulate a lot of the HAMP standards in their own proprietary (mortgage) modifications,” Massad said. “We’re having an effect on avoiding foreclosures.”
HAMP encourages mortgage servicers to take steps such as lowering a homeowner’s interest rate or reducing mortgage principal. Homeowners first get temporary modifications that last at least three months and can receive a permanent modification if the trial succeeds.
A large number of homeowners applied in the program’s early months, which led to a surge in permanent modifications from January to June as Treasury officials processed a backlog, Massad said. Applicants have since leveled off, which accounts for the drop in permanent modifications, Massad said.
Massad noted that 11 percent of homeowners in HAMP had defaulted on their modified mortgages, a figure he called “very good. The vast majority of people in permanent modifications are staying in them.”
But the foreclosure problem remains “incredibly complex,” and HAMP has been “a work in progress” with program changes that have made it difficult for servicers to implement, Zandi said.
The report Monday said Bank of America took 73 seconds to answer HAMP-related calls in August, well above the 5.5-second average call-response time.
“We’re disappointed,” bank spokesman Roger Simon said, calling August a “high-volume month.”
He said its response time through mid-September is “down considerably.”
Source: 2010 USA TODAY, a division of Gannett Co. Inc., Thomas Frank.
Fed throws its weight into foreclosure probe
Raising pressure on banks, the Federal Reserve is wading into the investigation of whether mortgage lenders cut corners and used flawed documents to foreclose on homes.
Major banks are already under investigation by state officials with subpoena power, who could force them to detail how they handled hundreds of thousands of foreclosure cases.
Federal Reserve Chairman Ben Bernanke added weight to those efforts Monday by saying the central bank would look “intensively” at policies and procedures that might have allowed banks to seize homes improperly.
“We take violation of proper procedures very seriously,” Bernanke said in remarks to a housing-finance conference in Arlington, Va.
The Fed has the power to impose penalties on some of the nation’s largest banks. Still, most legal experts expect an investigation by attorneys general in all 50 states to have a swifter and more lasting impact.
Big mortgage lenders are looking into whether employees signed foreclosure documents without reading them. Some banks have halted tens of thousands of foreclosures since similar practices became public.
While the banks say there’s little if any evidence that any foreclosures were improper, regulators around the country have suggested the banks were in a rush to foreclose and may have committed outright fraud.
Bank of America and Ally Financial Inc.’s GMAC Mortgage have started processing foreclosures again, after calling a temporary halt while they reviewed mortgage documents.
It’s happening as the housing market struggles to recover. Sales of previously occupied homes rose 10 percent in September, but the foreclosure problem surfaced only at the end of the month. Industry experts say fears could keep buyers on the sidelines now.
Ohio Attorney General Richard Cordray said Bernanke’s speech will force financial institutions to take the matter more seriously. In stepping up their inquiries, the Fed and other bank regulators are “not giving aid and comfort to institutions that want to sort of minimize this and almost sweep it under the rug,” Cordray said.
The Fed is working with the Treasury Department’s Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp. They have a range of options. They include ordering companies to stop certain practices, imposing fines and working with lenders to come up with a fix. Bernanke provided no details in his speech about any penalties being weighed.
According to two officials familiar with the joint federal inquiry, the banking agencies are looking into whether companies had controls in place when foreclosure documents were signed and whether employees involved in the foreclosure process were adequately trained. The officials spoke on condition of anonymity because they weren’t authorized to speak about the inquiry.
Ultimately, though, the mess will probably be settled by the states.
“They can move more quickly than the Fed, and I think they have more leverage over banks to get them to quickly settle,” said Mark Williams, a former bank examiner at the Fed and now a lecturer at Boston University.
Some analysts suggested the Fed is trying to send the message that it’s helping to manage the foreclosure controversy. The central bank shared blame with other federal regulators for failing to head off the 2008 financial crisis.
“The Fed is already late to the crime scene,” Williams said.
Like the Obama administration, Bernanke and other federal regulators have declined to call for a national moratorium on foreclosures. At least one regulator, Sheila Bair, chairman of the FDIC, is even discouraging homeowners from overloading the courts with lawsuits.
“The regrettable truth is that many of the properties currently in the foreclosure process are either vacant or occupied by borrowers who simply cannot make even a significantly reduced payment,” Bair said in a speech Monday.
In home markets that have been devastated by the housing bust, the paperwork mess is already causing buyers to be wary of purchasing homes in foreclosure. Some buyers are worried the sale will be canceled because the previous owners were wrongly foreclosed on.
Roy Weiner, a Las Vegas real estate agent who specializes in foreclosures, said potential buyers of those properties have been aggressively inquiring about which bank holds the defaulting borrower’s loans – and whether the foreclosure was handled properly.
“They are asking a whole lot more questions,” Weiner said.
Source: The Associated Press, Alan Zibel and Jeannine Aversa, AP business writers. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. AP Business Writers Marcy Gordon in Washington and Michelle Conlin in New York contributed to this report.
Major banks are already under investigation by state officials with subpoena power, who could force them to detail how they handled hundreds of thousands of foreclosure cases.
Federal Reserve Chairman Ben Bernanke added weight to those efforts Monday by saying the central bank would look “intensively” at policies and procedures that might have allowed banks to seize homes improperly.
“We take violation of proper procedures very seriously,” Bernanke said in remarks to a housing-finance conference in Arlington, Va.
The Fed has the power to impose penalties on some of the nation’s largest banks. Still, most legal experts expect an investigation by attorneys general in all 50 states to have a swifter and more lasting impact.
Big mortgage lenders are looking into whether employees signed foreclosure documents without reading them. Some banks have halted tens of thousands of foreclosures since similar practices became public.
While the banks say there’s little if any evidence that any foreclosures were improper, regulators around the country have suggested the banks were in a rush to foreclose and may have committed outright fraud.
Bank of America and Ally Financial Inc.’s GMAC Mortgage have started processing foreclosures again, after calling a temporary halt while they reviewed mortgage documents.
It’s happening as the housing market struggles to recover. Sales of previously occupied homes rose 10 percent in September, but the foreclosure problem surfaced only at the end of the month. Industry experts say fears could keep buyers on the sidelines now.
Ohio Attorney General Richard Cordray said Bernanke’s speech will force financial institutions to take the matter more seriously. In stepping up their inquiries, the Fed and other bank regulators are “not giving aid and comfort to institutions that want to sort of minimize this and almost sweep it under the rug,” Cordray said.
The Fed is working with the Treasury Department’s Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp. They have a range of options. They include ordering companies to stop certain practices, imposing fines and working with lenders to come up with a fix. Bernanke provided no details in his speech about any penalties being weighed.
According to two officials familiar with the joint federal inquiry, the banking agencies are looking into whether companies had controls in place when foreclosure documents were signed and whether employees involved in the foreclosure process were adequately trained. The officials spoke on condition of anonymity because they weren’t authorized to speak about the inquiry.
Ultimately, though, the mess will probably be settled by the states.
“They can move more quickly than the Fed, and I think they have more leverage over banks to get them to quickly settle,” said Mark Williams, a former bank examiner at the Fed and now a lecturer at Boston University.
Some analysts suggested the Fed is trying to send the message that it’s helping to manage the foreclosure controversy. The central bank shared blame with other federal regulators for failing to head off the 2008 financial crisis.
“The Fed is already late to the crime scene,” Williams said.
Like the Obama administration, Bernanke and other federal regulators have declined to call for a national moratorium on foreclosures. At least one regulator, Sheila Bair, chairman of the FDIC, is even discouraging homeowners from overloading the courts with lawsuits.
“The regrettable truth is that many of the properties currently in the foreclosure process are either vacant or occupied by borrowers who simply cannot make even a significantly reduced payment,” Bair said in a speech Monday.
In home markets that have been devastated by the housing bust, the paperwork mess is already causing buyers to be wary of purchasing homes in foreclosure. Some buyers are worried the sale will be canceled because the previous owners were wrongly foreclosed on.
Roy Weiner, a Las Vegas real estate agent who specializes in foreclosures, said potential buyers of those properties have been aggressively inquiring about which bank holds the defaulting borrower’s loans – and whether the foreclosure was handled properly.
“They are asking a whole lot more questions,” Weiner said.
Source: The Associated Press, Alan Zibel and Jeannine Aversa, AP business writers. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. AP Business Writers Marcy Gordon in Washington and Michelle Conlin in New York contributed to this report.
10 Do's and Don't's for Maximizing Your Twitter Account
RISMEDIA, October 26, 2010--So by now, you might have a Twitter account, but are you maximizing it and using it properly for your business? If not, now is a good time to start. Soon enough, consumers will start expecting this form of communication from you. Are you prepared?
Here are some Do's and Don't's from nFusion, a company that specializes in advertising and interactive marketing strategy, for what you should, and more importantly, shouldn't be doing with your Twitter profile.
Do's
1. Download a Twitter client. A Twittter client, like TweetDeck, will give you quick access to your tweet timeline, your followers’ timelines, and search for topics that interest you. Then you can complete your profile and start gaining followers.
2. Monitor discussions on relevant subjects. Twitter conversations happen in real time and you need to be ready to jump in and respond before the conversation stops. Find these discussions using the Twitter Search feature and enter a subject.
3. Tag your tweets using a hash tag when talking about popular subject matters. A hash tag is created by using the pound symbol (#) followed by the subject name. Anyone who searches for that particular subject will then be alerted of your tweets.
4. Tweet frequently. An update to your Twitter account is referred to as a “tweet.” The more often you tweet, the more opportunities you’ll have to grow your follower base.
5. Re-post others’ tweets or links using the retweet (RT) tag. Retweeting shows you’re engaged and associates you with good content. To retweet, just use the “RT” tag, as in “RT@dave1: CNN reports meteor shower.”
Don’t's
1. Don’t only tweet about your product or service. There’s nothing wrong with discussing your company’s latest news, but if all of your Tweets are about your business others will consider you a spammer.
2. Don’t tweet 10 times in a row and be done for the day. Conversations are happening at all times of the day, so don’t limit your reach by engaging users for just a short period of time.
3. Don’t be afraid to disagree with other users. Disagreeing publicly is a great way to get attention. But always be respectful. Tweets can be indexed by search engines and referenced by the public. Make sure your response is appropriate for anyone who might read it.
4. Don’t stop finding people to follow. To increase the likelihood of users finding your profile, you need to follow them first. Use Twitter’s search function to discover people who share your interests.
5. Don’t include lengthy URLs in your posts. Because Twitter allows posts of 140 characters or under (spaces included), it is sometimes helpful to use a URL shortener such as kl.am to convert long addresses.
By Stephanie Andre, RISMedia
Here are some Do's and Don't's from nFusion, a company that specializes in advertising and interactive marketing strategy, for what you should, and more importantly, shouldn't be doing with your Twitter profile.
Do's
1. Download a Twitter client. A Twittter client, like TweetDeck, will give you quick access to your tweet timeline, your followers’ timelines, and search for topics that interest you. Then you can complete your profile and start gaining followers.
2. Monitor discussions on relevant subjects. Twitter conversations happen in real time and you need to be ready to jump in and respond before the conversation stops. Find these discussions using the Twitter Search feature and enter a subject.
3. Tag your tweets using a hash tag when talking about popular subject matters. A hash tag is created by using the pound symbol (#) followed by the subject name. Anyone who searches for that particular subject will then be alerted of your tweets.
4. Tweet frequently. An update to your Twitter account is referred to as a “tweet.” The more often you tweet, the more opportunities you’ll have to grow your follower base.
5. Re-post others’ tweets or links using the retweet (RT) tag. Retweeting shows you’re engaged and associates you with good content. To retweet, just use the “RT” tag, as in “RT@dave1: CNN reports meteor shower.”
Don’t's
1. Don’t only tweet about your product or service. There’s nothing wrong with discussing your company’s latest news, but if all of your Tweets are about your business others will consider you a spammer.
2. Don’t tweet 10 times in a row and be done for the day. Conversations are happening at all times of the day, so don’t limit your reach by engaging users for just a short period of time.
3. Don’t be afraid to disagree with other users. Disagreeing publicly is a great way to get attention. But always be respectful. Tweets can be indexed by search engines and referenced by the public. Make sure your response is appropriate for anyone who might read it.
4. Don’t stop finding people to follow. To increase the likelihood of users finding your profile, you need to follow them first. Use Twitter’s search function to discover people who share your interests.
5. Don’t include lengthy URLs in your posts. Because Twitter allows posts of 140 characters or under (spaces included), it is sometimes helpful to use a URL shortener such as kl.am to convert long addresses.
By Stephanie Andre, RISMedia
Monday, October 25, 2010
Bernanke: We Take Violations Seriously
Federal Reserve Chair Ben Bernanke announced Monday that the Fed would release preliminary findings in November from its investigation of lender and mortgage servicers’ processes.
“We take violations of proper procedures seriously,” Bernanke said in a presentation to a conference on mortgages and housing finance, hosted by the Fed and Federal Deposit Insurance Corp.
Bernanke also said in his previously released remarks: “More than 20 percent of borrowers owe more than their home is worth, and an additional 33 percent have equity cushions of 10 percent or less, putting them at risk should house prices decline much further. With housing markets still weak, high levels of mortgage distress may well persist for some time to come.”
Source: Bloomberg, Scott Lanman (10/25/2010)
“We take violations of proper procedures seriously,” Bernanke said in a presentation to a conference on mortgages and housing finance, hosted by the Fed and Federal Deposit Insurance Corp.
Bernanke also said in his previously released remarks: “More than 20 percent of borrowers owe more than their home is worth, and an additional 33 percent have equity cushions of 10 percent or less, putting them at risk should house prices decline much further. With housing markets still weak, high levels of mortgage distress may well persist for some time to come.”
Source: Bloomberg, Scott Lanman (10/25/2010)
Wells Fargo Continues Foreclosures
Bank of America announced Sunday that no homes were foreclosed in error, but it did find a few technical errors in its investigation. As a result, it has combined the signing and notarization processes into a single step. Bank spokesman Dan Frahm said the bank believed this would prevent the possibility of further error as it restarts foreclosure actions beginning Monday.
Meanwhile, Wells Fargo & Co. is staying mum about the whole process and keeping foreclosures moving along. Foreclosure attorneys say that Wells Fargo is betting that its refusal to halt foreclosures will, in the long run, discourage more home owners from fighting foreclosure.
"My belief is it may be a strategic move not to admit anything," said Richard Roth, founder of The Roth Law Firm in New York. "It's a legal strategy – and it may pay off if no one refutes them."
Source: Reuters News, Elinor Comlay and Joe Rauch (10/22/2010), and The New York Times, Nelson D. Schwartz (10/25/2010)
Meanwhile, Wells Fargo & Co. is staying mum about the whole process and keeping foreclosures moving along. Foreclosure attorneys say that Wells Fargo is betting that its refusal to halt foreclosures will, in the long run, discourage more home owners from fighting foreclosure.
"My belief is it may be a strategic move not to admit anything," said Richard Roth, founder of The Roth Law Firm in New York. "It's a legal strategy – and it may pay off if no one refutes them."
Source: Reuters News, Elinor Comlay and Joe Rauch (10/22/2010), and The New York Times, Nelson D. Schwartz (10/25/2010)
Lawsuit claims Citizens wrongly awarded contracts
A class-action lawsuit contends that Citizens Property Insurance Corp. improperly awarded dozens of no-bid contracts worth more than $49 million.
The lawsuit filed Thursday in Tallahassee seeks unspecified damages for the 1.2 million Citizens policyholders. The attorney who filed the complaint says the alleged mismanagement costs policyholders in higher rates.
Citizens is supposed to take competitive bids for all contracts above $25,000, except in emergencies or when there is one vendor. The lawsuit says 33 contracts since 2004 have violated those rules.
A Citizens statement said all 33 contracts in question were properly awarded.
Florida’s auditor general in 2006 also raised questions about Citizens’ contracting process.
Source: 2010 The Associated Press.
The lawsuit filed Thursday in Tallahassee seeks unspecified damages for the 1.2 million Citizens policyholders. The attorney who filed the complaint says the alleged mismanagement costs policyholders in higher rates.
Citizens is supposed to take competitive bids for all contracts above $25,000, except in emergencies or when there is one vendor. The lawsuit says 33 contracts since 2004 have violated those rules.
A Citizens statement said all 33 contracts in question were properly awarded.
Florida’s auditor general in 2006 also raised questions about Citizens’ contracting process.
Source: 2010 The Associated Press.
The aging agent population and its implications on the real estate industry
The National Association of Realtors reports that there are almost twice as many real estate agents over age 40 than there are under age 40.
Agents over 40 have had to adopt new technologies in order to work with younger, more tech-savvy clients; but they should remember that experience and customer service skills remain valuable assets.
Agents under 40 will have a chance to boost their market share as older professionals retire, especially given their ability to implement new technologies and means of communication in a timely manner.
As the number of new real estate agents falls, multiple listing services will see membership decline, putting downward pressure on revenues. With MLSs cutting costs and re-evaluating core services, vendors must take steps to prove their products and services have value.
Meanwhile, consumers are more informed and confident these days because more real estate data and information is available to them. However, those considering a career in real estate could find it difficult to enter the field as numerous real estate schools have been shuttered in the past five years.
Source: RISMedia (10/21/10) Bailey, Rich
Source: INFORMATION, INC. Bethesda, MD
Agents over 40 have had to adopt new technologies in order to work with younger, more tech-savvy clients; but they should remember that experience and customer service skills remain valuable assets.
Agents under 40 will have a chance to boost their market share as older professionals retire, especially given their ability to implement new technologies and means of communication in a timely manner.
As the number of new real estate agents falls, multiple listing services will see membership decline, putting downward pressure on revenues. With MLSs cutting costs and re-evaluating core services, vendors must take steps to prove their products and services have value.
Meanwhile, consumers are more informed and confident these days because more real estate data and information is available to them. However, those considering a career in real estate could find it difficult to enter the field as numerous real estate schools have been shuttered in the past five years.
Source: RISMedia (10/21/10) Bailey, Rich
Source: INFORMATION, INC. Bethesda, MD
Stalled foreclosures could swamp local home-buying market
As big lenders’ recent freeze on foreclosures begins to thaw, local real-estate agents worry that those bargain properties will now flood the market and further sink housing prices.
Just a few weeks after Bank of America, J.P. Morgan Chase and other big banks announced a temporary halt to foreclosures because of concerns about improperly signed documents, they are preparing to restart the process. The question is: How many of those stalled foreclosures will lenders put on the market at the same time?
“That’s the big question – will they come back in a big thud or will they trickle in?” said Winter Park real-estate broker David Welch of Re/Max 200. “Unfortunately, I don’t know anyone who knows what the answer is. I think if they come flooding back it obviously won’t be a good thing in the market.”
Since the moratoriums were announced at the beginning of the month, 53 percent of the scheduled foreclosure sales in Orange County have been canceled – creating a backlog of as many as 850 properties that lenders pulled from the process just prior to their hitting the market. In the three weeks preceding the freeze, only 38 percent of the county’s auctions had been canceled, primarily because of judicial requirements for mediation and for face-to-face conversations between lenders and borrowers.
In Orange County Courthouse Room 350, crammed with investors attending the daily foreclosure auctions, longtime buyer Jack Coughlin said last week that he sees banks sitting on a growing inventory of foreclosed houses just waiting to hit the market.
“Are they going to release them all? If they do, there is going to be a 20 percent drop in values,” Coughlin said. “People ask, ‘Where are these properties?’ They are sitting in banks’ vaults.”
Thomas Kelly, a spokesman for J.P. Morgan Chase, said last week his company is still reviewing cases and had not announced any kind of timetable for releasing foreclosed properties to the market.
Orlando ranks 10th in the nation for foreclosure filings, according to a September report by the real estate research company RealtyTrac Inc. The crash that followed the peak-market conditions of three or four years ago has dragged down Orlando’s median resale price from $264,000 in July 2007 to $105,000 last month. Bargain-basement prices already dominate the market: More than 70 percent of the area’s existing-home sales currently involve bank-owned or short-sale properties that sell for less than market value, according to the Orlando Regional Realtor Association.
Lenders’ decision to halt foreclosures in early October did two things to Orlando’s real-estate market: drove up prices and drove down sales. The absence of those bargain properties from the market has caused the median price to spike about $10,000 in recent weeks, to about $115,000, said Welch, who continually tracks the market. And the inventory of active listings has dropped by about 3 percent, he added.
State attorneys general had stepped up pressure on lenders after it was revealed that bank employees had signed foreclosure affidavits without verifying that the documents were accurate – a process known as “robo-signing.” But after reviewing more than 100,000 documents in Florida and 22 other states, Bank of America announced last week that it was restarting the foreclosure process. GMAC Mortgage also said it was resuming work on its foreclosures.
The banks had never stopped litigating the cases; they had just canceled the foreclosure sales to give themselves time to investigate the suspect paperwork and signatures, said Orlando lawyer Matt Englett, whose firm handles tens of thousands of foreclosures. He said robo-signing can become apparent if the names of certain bank employees continually show up on certain documents.
People will still lose their homes, Englett said, but they may be able to walk away without a deficiency judgment against them – without owing any additional money, in other words – if it turns out their paperwork includes suspect signatures. Owners may also be in a better position to get their mortgage terms modified if their foreclosure paperwork has been tarnished in some way.
So far, local real-estate agents haven’t seen any signs of once-stalled foreclosures hitting the market.
“I had more than a third of my listings pulled,” Maitland real-estate agent Lee Acker said. “We had a buyer ready to close on one. It’s just frustrating. These were properties ready to go to owner-occupants.”
In the short term, Acker said, the moratoriums “created an artificial demand for the property that’s left. What I’m afraid of is when they go back on the market.”
Source: The Orlando Sentinel, Fla., Mary Shanklin. Distributed by McClatchy-Tribune Information Services.
Just a few weeks after Bank of America, J.P. Morgan Chase and other big banks announced a temporary halt to foreclosures because of concerns about improperly signed documents, they are preparing to restart the process. The question is: How many of those stalled foreclosures will lenders put on the market at the same time?
“That’s the big question – will they come back in a big thud or will they trickle in?” said Winter Park real-estate broker David Welch of Re/Max 200. “Unfortunately, I don’t know anyone who knows what the answer is. I think if they come flooding back it obviously won’t be a good thing in the market.”
Since the moratoriums were announced at the beginning of the month, 53 percent of the scheduled foreclosure sales in Orange County have been canceled – creating a backlog of as many as 850 properties that lenders pulled from the process just prior to their hitting the market. In the three weeks preceding the freeze, only 38 percent of the county’s auctions had been canceled, primarily because of judicial requirements for mediation and for face-to-face conversations between lenders and borrowers.
In Orange County Courthouse Room 350, crammed with investors attending the daily foreclosure auctions, longtime buyer Jack Coughlin said last week that he sees banks sitting on a growing inventory of foreclosed houses just waiting to hit the market.
“Are they going to release them all? If they do, there is going to be a 20 percent drop in values,” Coughlin said. “People ask, ‘Where are these properties?’ They are sitting in banks’ vaults.”
Thomas Kelly, a spokesman for J.P. Morgan Chase, said last week his company is still reviewing cases and had not announced any kind of timetable for releasing foreclosed properties to the market.
Orlando ranks 10th in the nation for foreclosure filings, according to a September report by the real estate research company RealtyTrac Inc. The crash that followed the peak-market conditions of three or four years ago has dragged down Orlando’s median resale price from $264,000 in July 2007 to $105,000 last month. Bargain-basement prices already dominate the market: More than 70 percent of the area’s existing-home sales currently involve bank-owned or short-sale properties that sell for less than market value, according to the Orlando Regional Realtor Association.
Lenders’ decision to halt foreclosures in early October did two things to Orlando’s real-estate market: drove up prices and drove down sales. The absence of those bargain properties from the market has caused the median price to spike about $10,000 in recent weeks, to about $115,000, said Welch, who continually tracks the market. And the inventory of active listings has dropped by about 3 percent, he added.
State attorneys general had stepped up pressure on lenders after it was revealed that bank employees had signed foreclosure affidavits without verifying that the documents were accurate – a process known as “robo-signing.” But after reviewing more than 100,000 documents in Florida and 22 other states, Bank of America announced last week that it was restarting the foreclosure process. GMAC Mortgage also said it was resuming work on its foreclosures.
The banks had never stopped litigating the cases; they had just canceled the foreclosure sales to give themselves time to investigate the suspect paperwork and signatures, said Orlando lawyer Matt Englett, whose firm handles tens of thousands of foreclosures. He said robo-signing can become apparent if the names of certain bank employees continually show up on certain documents.
People will still lose their homes, Englett said, but they may be able to walk away without a deficiency judgment against them – without owing any additional money, in other words – if it turns out their paperwork includes suspect signatures. Owners may also be in a better position to get their mortgage terms modified if their foreclosure paperwork has been tarnished in some way.
So far, local real-estate agents haven’t seen any signs of once-stalled foreclosures hitting the market.
“I had more than a third of my listings pulled,” Maitland real-estate agent Lee Acker said. “We had a buyer ready to close on one. It’s just frustrating. These were properties ready to go to owner-occupants.”
In the short term, Acker said, the moratoriums “created an artificial demand for the property that’s left. What I’m afraid of is when they go back on the market.”
Source: The Orlando Sentinel, Fla., Mary Shanklin. Distributed by McClatchy-Tribune Information Services.
Florida’s existing condo sales up in September 2010
Sales of existing condominiums in Florida rose 10 percent in September, with a total of 5,675 condos sold statewide compared to 5,140 units sold in September 2009, according to the latest housing data released by Florida Realtors®.
Ten of Florida’s metropolitan statistical areas (MSAs) reported higher existing condo sales in September. The statewide existing condo median sales price last month was $83,400; in September 2009 it was $102,300 for an 18 percent decrease. However, September’s statewide existing condo median price was 2.2 percent higher than the statewide existing condo median of $81,600 in August. The national median existing condo price was $174,000 in August, according to the National Association of Realtors® (NAR).
Meanwhile, in the year-to-year comparison for existing home sales, a total of 13,536 single-family existing homes sold statewide last month compared to 14,781 homes sold in September 2009 for a decrease of 8 percent. Florida’s median existing-home sales price in September was $133,400; a year earlier, it was $141,700 for a decrease of 6 percent. The median is the midpoint; half the homes sold for more, half for less.
“Like the rest of the nation, Florida’s housing market is feeling pressure from an uncertain economy,” said 2010 Florida Realtors President Wendell Davis, a broker with Watson Realty Corp. in Jacksonville. “Easing foreclosures and increasing job growth would go a long way in stabilizing the market and strengthening the economic recovery. However, current record low mortgage rates along with available and affordable inventory continue to offer a rare opportunity for consumers who are ready to buy a home.”
The national median sales price for existing single-family homes in August was $179,300, up 1.2 percent from a year earlier, according to the National Association of Realtors® (NAR). In Massachusetts, the statewide median resales price was $330,000 in August; in California, it was $318,660; in Maryland, it was $262,339; and in New York, it was $240,000.
NAR’s latest industry outlook calls for a gradual improvement in home sales in upcoming months. “Attractive affordability conditions from very low mortgage interest rates appear to be bringing buyers back to the market,” said NAR Chief Economist Lawrence Yun. “However, the pace of a home sales recovery still depends more on job creation and an accompanying rise in consumer confidence. The housing market is trying to recover on its own power without the homebuyer tax credit.”
In September, the interest rate for a 30-year fixed-rate mortgage averaged 4.35 percent, significantly lower than the 5.06 percent average during the same month a year earlier, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
Source: Florida Realtors®
Ten of Florida’s metropolitan statistical areas (MSAs) reported higher existing condo sales in September. The statewide existing condo median sales price last month was $83,400; in September 2009 it was $102,300 for an 18 percent decrease. However, September’s statewide existing condo median price was 2.2 percent higher than the statewide existing condo median of $81,600 in August. The national median existing condo price was $174,000 in August, according to the National Association of Realtors® (NAR).
Meanwhile, in the year-to-year comparison for existing home sales, a total of 13,536 single-family existing homes sold statewide last month compared to 14,781 homes sold in September 2009 for a decrease of 8 percent. Florida’s median existing-home sales price in September was $133,400; a year earlier, it was $141,700 for a decrease of 6 percent. The median is the midpoint; half the homes sold for more, half for less.
“Like the rest of the nation, Florida’s housing market is feeling pressure from an uncertain economy,” said 2010 Florida Realtors President Wendell Davis, a broker with Watson Realty Corp. in Jacksonville. “Easing foreclosures and increasing job growth would go a long way in stabilizing the market and strengthening the economic recovery. However, current record low mortgage rates along with available and affordable inventory continue to offer a rare opportunity for consumers who are ready to buy a home.”
The national median sales price for existing single-family homes in August was $179,300, up 1.2 percent from a year earlier, according to the National Association of Realtors® (NAR). In Massachusetts, the statewide median resales price was $330,000 in August; in California, it was $318,660; in Maryland, it was $262,339; and in New York, it was $240,000.
NAR’s latest industry outlook calls for a gradual improvement in home sales in upcoming months. “Attractive affordability conditions from very low mortgage interest rates appear to be bringing buyers back to the market,” said NAR Chief Economist Lawrence Yun. “However, the pace of a home sales recovery still depends more on job creation and an accompanying rise in consumer confidence. The housing market is trying to recover on its own power without the homebuyer tax credit.”
In September, the interest rate for a 30-year fixed-rate mortgage averaged 4.35 percent, significantly lower than the 5.06 percent average during the same month a year earlier, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
Source: Florida Realtors®
Friday, October 22, 2010
Q&A: Author Sarah Susanka Talks Budget-Smart Remodeling
HouseLogic sat down with author and architect Sarah Susanka to talk about remodeling that builds value and saves money.
For Sarah Susanka, architect and author of the Not So Big House series of books, remodeling is an opportunity-not just for realizing your improvement and decor dreams, but for making your home comfortable, right-sized, and energy efficient.
In this Q&A, Susanka helps homeowners make smart decisions about that next big project.
HouseLogic: What are your top three pieces of advice for homeowners considering a remodel?
Sarah Susanka: 1. While you're remodeling, take the opportunity to upgrade the energy systems in your house. It will make the house more comfortable and more valuable in the long haul. Today's buyers will ask to see utility bills, and may not consider homes that aren't energy efficient.
2. You can remodel without having to add on. We tend to assume we have to add space. But many spaces in a home are underused. Consider how to repurpose that space to do double duty.
3. The way we live in our homes today is different than before the 1970s. Formal dining rooms may not get a lot of use, for instance. Open a view from the kitchen to the dining or living room. People will start using those rooms and the house will feel a lot bigger, which is also a sales point.
HL: Where do you get the biggest return for your remodeling investment?
SS: Kitchens and bathrooms. But often people spend more money on their kitchen than they think they will, which can affect the return. Work within the existing footprint of the kitchen to stay reasonably priced.
People often assume that if they buy more expensive materials, that equates to higher value. But it's the quality of design that sells and equates to more value.
HL: How can the budget-minded homeowner conserve funds?
SS: Consider materials. Opt for a plastic laminate countertop with bullnose (fully rounded edges in which the laminate wraps under the countertop) rather than a granite countertop. It's a great look, but less expensive than granite. You can't tell that it isn't a solid material.
For tile backsplashes, make an impact by spending a little more to add some drama tile above the cook top. But spend less on surrounding tiles. That can save one-sixth of the price than doing the whole backsplash in expensive material.
HL: Where should you splurge?
SS: On the kitchen island. It's a focal point. Here you could invest in granite, since the island requires a rectangular chunk of material without a lot of cutouts, which is where the labor and expense come in. And then you can say, "I have granite."
Flooring is another place to invest. Get a designer to help you select a product that gives the room a sense of permanence and solidity. Also, people often pick too light a color, which makes it look cheap.
HL: What about green materials-do they have to be expensive?
SS: People are scared about green materials being expensive. But they don't need to be. Many IKEA products, for instance, are green certified. More products, like cost-effective bamboo, will begin appearing at home improvement stores, too.
HL: Why is retrofitting an existing home more cost efficient than building new?
SS: For each $5,000 in energy improvements you spend on a new house, you only get small, incremental gains in energy efficiency. A California energy consulting company study found that retrofitting existing homes with energy-efficient features is four to eight times more carbon and cost efficient than adding energy-efficient features to new housing.
HL: You believe beauty is sustainable. Why?
SS: Beauty is one of the greenest things you can do. If a home is beautiful, it will be looked after by the current homeowner and all those who follow. It's good to create beauty and energy efficiency as you go. If your home is beautiful and comfortable, you'll save money and enjoy it. If it's not beautiful-even if it's energy efficient-someone will tear it down, and that's not green.
Article From HouseLogic.com
For Sarah Susanka, architect and author of the Not So Big House series of books, remodeling is an opportunity-not just for realizing your improvement and decor dreams, but for making your home comfortable, right-sized, and energy efficient.
In this Q&A, Susanka helps homeowners make smart decisions about that next big project.
HouseLogic: What are your top three pieces of advice for homeowners considering a remodel?
Sarah Susanka: 1. While you're remodeling, take the opportunity to upgrade the energy systems in your house. It will make the house more comfortable and more valuable in the long haul. Today's buyers will ask to see utility bills, and may not consider homes that aren't energy efficient.
2. You can remodel without having to add on. We tend to assume we have to add space. But many spaces in a home are underused. Consider how to repurpose that space to do double duty.
3. The way we live in our homes today is different than before the 1970s. Formal dining rooms may not get a lot of use, for instance. Open a view from the kitchen to the dining or living room. People will start using those rooms and the house will feel a lot bigger, which is also a sales point.
HL: Where do you get the biggest return for your remodeling investment?
SS: Kitchens and bathrooms. But often people spend more money on their kitchen than they think they will, which can affect the return. Work within the existing footprint of the kitchen to stay reasonably priced.
People often assume that if they buy more expensive materials, that equates to higher value. But it's the quality of design that sells and equates to more value.
HL: How can the budget-minded homeowner conserve funds?
SS: Consider materials. Opt for a plastic laminate countertop with bullnose (fully rounded edges in which the laminate wraps under the countertop) rather than a granite countertop. It's a great look, but less expensive than granite. You can't tell that it isn't a solid material.
For tile backsplashes, make an impact by spending a little more to add some drama tile above the cook top. But spend less on surrounding tiles. That can save one-sixth of the price than doing the whole backsplash in expensive material.
HL: Where should you splurge?
SS: On the kitchen island. It's a focal point. Here you could invest in granite, since the island requires a rectangular chunk of material without a lot of cutouts, which is where the labor and expense come in. And then you can say, "I have granite."
Flooring is another place to invest. Get a designer to help you select a product that gives the room a sense of permanence and solidity. Also, people often pick too light a color, which makes it look cheap.
HL: What about green materials-do they have to be expensive?
SS: People are scared about green materials being expensive. But they don't need to be. Many IKEA products, for instance, are green certified. More products, like cost-effective bamboo, will begin appearing at home improvement stores, too.
HL: Why is retrofitting an existing home more cost efficient than building new?
SS: For each $5,000 in energy improvements you spend on a new house, you only get small, incremental gains in energy efficiency. A California energy consulting company study found that retrofitting existing homes with energy-efficient features is four to eight times more carbon and cost efficient than adding energy-efficient features to new housing.
HL: You believe beauty is sustainable. Why?
SS: Beauty is one of the greenest things you can do. If a home is beautiful, it will be looked after by the current homeowner and all those who follow. It's good to create beauty and energy efficiency as you go. If your home is beautiful and comfortable, you'll save money and enjoy it. If it's not beautiful-even if it's energy efficient-someone will tear it down, and that's not green.
Article From HouseLogic.com
Fannie, Freddie bailout to cost $154B
The government bailout of mortgage giants Fannie Mae and Freddie Mac likely will cost taxpayers $154 billion – somewhat more than originally anticipated but less than recent worst-case projections, according to government estimates released Thursday.
Since the government-sponsored mortgage giants already have received $135 billion in Treasury Department funds, they likely would draw another $19 billion by 2013 to offset losses from the mortgage crisis.
“Today’s projections show that, in the most likely economic scenario, nearly 90 percent of the losses at Fannie Mae and Freddie Mac are already behind us,” says Jeffrey Goldstein, Treasury’s undersecretary for domestic finance.
The government took over the two finance firms in September 2008 as they teetered in the mortgage crisis. Fannie and Freddie buy mortgages from banks and other lenders. They purchased 62 percent of all new mortgages the first half of 2010, according to trade publication Inside Mortgage Finance.
The $154 billion estimate represents the middle ground of three possible scenarios laid out by the Federal Housing Finance Agency, which regulates Fannie and Freddie. It uses Moody’s Analytics estimates showing home prices likely will fall another 8 percent by the third quarter of 2011.
Under Moody’s “stronger-recovery” scenario, which assumes a smaller home price decline, the bailouts would cost $142 billion. If the economy slips back into recession, costs could climb to $259 billion.
All these figures exclude dividends paid, or expected to be paid, to Treasury based on its preferred shares in Fannie and Freddie. If those amounts were included, the companies are expected to draw $221 billion to $363 billion by 2013. That includes the $148 billion they’ve already received.
The middle scenario of $238 billion, including dividends, is 20 percent more than the up to $200 billion estimated in 2008. But earlier this year, Edward DeMarco, FHFA acting director, said the tab could hit $400 billion. “It cost a lot less than what people feared, largely because the economy has stabilized,” says Moody’s chief economist Mark Zandi.
Still, the bailout is far costlier than other government rescues. Bailouts of the financial firms and auto companies have cost taxpayers $50 billion.
Source: USA TODAY, a division of Gannett Co. Inc., Paul Davidson.
Since the government-sponsored mortgage giants already have received $135 billion in Treasury Department funds, they likely would draw another $19 billion by 2013 to offset losses from the mortgage crisis.
“Today’s projections show that, in the most likely economic scenario, nearly 90 percent of the losses at Fannie Mae and Freddie Mac are already behind us,” says Jeffrey Goldstein, Treasury’s undersecretary for domestic finance.
The government took over the two finance firms in September 2008 as they teetered in the mortgage crisis. Fannie and Freddie buy mortgages from banks and other lenders. They purchased 62 percent of all new mortgages the first half of 2010, according to trade publication Inside Mortgage Finance.
The $154 billion estimate represents the middle ground of three possible scenarios laid out by the Federal Housing Finance Agency, which regulates Fannie and Freddie. It uses Moody’s Analytics estimates showing home prices likely will fall another 8 percent by the third quarter of 2011.
Under Moody’s “stronger-recovery” scenario, which assumes a smaller home price decline, the bailouts would cost $142 billion. If the economy slips back into recession, costs could climb to $259 billion.
All these figures exclude dividends paid, or expected to be paid, to Treasury based on its preferred shares in Fannie and Freddie. If those amounts were included, the companies are expected to draw $221 billion to $363 billion by 2013. That includes the $148 billion they’ve already received.
The middle scenario of $238 billion, including dividends, is 20 percent more than the up to $200 billion estimated in 2008. But earlier this year, Edward DeMarco, FHFA acting director, said the tab could hit $400 billion. “It cost a lot less than what people feared, largely because the economy has stabilized,” says Moody’s chief economist Mark Zandi.
Still, the bailout is far costlier than other government rescues. Bailouts of the financial firms and auto companies have cost taxpayers $50 billion.
Source: USA TODAY, a division of Gannett Co. Inc., Paul Davidson.
DBPR improves online application process
The Department of Business and Professional Regulation (DBPR) announced today that it improved the online application process for electrical contractors, harbor pilots, veterinarians, community association managers, talent agents and athlete agents.
The upgrade is Phase 2 of a four-phase project. Real estate licenses – part of the Phase 4 rollout – should see a similar improvement starting in January 2011. Phase 1, completed in September, provided the new online service to cosmetologists, real estate appraisers and the Division of Hotels and Restaurants renewal applicants.
The new process allows new and renewing applicants to submit all documentation online. DBPR says the online system reduces the amount of time it takes to review and approve applications, enabling them to process a higher volume at a faster pace. For licensees, the online application system makes it easier to get licensed and begin work.
For more information, please visit MyFloridaLicense.com.
The upgrade is Phase 2 of a four-phase project. Real estate licenses – part of the Phase 4 rollout – should see a similar improvement starting in January 2011. Phase 1, completed in September, provided the new online service to cosmetologists, real estate appraisers and the Division of Hotels and Restaurants renewal applicants.
The new process allows new and renewing applicants to submit all documentation online. DBPR says the online system reduces the amount of time it takes to review and approve applications, enabling them to process a higher volume at a faster pace. For licensees, the online application system makes it easier to get licensed and begin work.
For more information, please visit MyFloridaLicense.com.
A foreclosure face-off between lenders and homeowners
Mortgage documents were treated in an almost lackadaisical way during the mortgage lending spree and now those documents are at the center of a legal clash that pits big lenders against homeowners.
About a month after Washington Mutual Bank made a multimillion-dollar mortgage loan on a mountain home near Santa Barbara, California, a crucial piece of paperwork disappeared.
But bank officials were unperturbed. After conducting a “due and diligent search,” an assistant vice president simply drew up an affidavit stating that the paperwork – a promissory note committing the borrower to repay the mortgage – could not be found, according to court documents.
The handling of that lost note in 2006 was hardly unusual. Mortgage documents of all sorts were treated in an almost lackadaisical way during the dizzying mortgage lending spree from 2005 through 2007, according to court documents, analysts and interviews.
Now those missing and possibly fraudulent documents are at the center of a potentially seismic legal clash that pits big lenders against homeowners and their advocates who are concerned that the lenders’ rush to foreclose flouts private property rights.
That clash – expected to be played out in courtrooms across the United States and scrutinized by law enforcement officials investigating possible wrongdoing by big lenders – leaped to the forefront of the mortgage crisis this week as big lenders began lifting their freezes on foreclosures and insisted the worst was behind them.
U.S. government officials meeting in Washington on Wednesday indicated that a government review of the problems would not be complete until the end of the year.
In short, the legal disagreement amounts to whether banks can rely on flawed documentation to repossess homes.
While even critics of the big lenders acknowledge that the vast majority of foreclosures involve homeowners who have not paid their mortgages, they argue that the borrowers are entitled to due legal process.
Banks “have essentially sidestepped 400 years of property law in the United States,” said Rebel A. Cole, a professor of finance and real estate at DePaul University in Chicago. “There are so many questionable aspects to this thing it’s scary.”
The country’s mortgage lenders contend that any problems that might be identified are technical and will not change the fact that they have the right to foreclose en masse.
“We did a thorough review of the process, and we found the facts underlying the decision to foreclose have been accurate,” Barbara J. Desoer, president of Bank of America Home Loans, said this week. “We paused while we were doing that, and now we’re moving forward.”
Some analysts are not sure that banks can proceed so freely. Katherine M. Porter, a visiting law professor at Harvard University and an expert on consumer credit law, said that lenders were wrong to minimize problems with the legal documentation.
“The misbehavior is clear: They lied to the courts,” she said. “The fact that they are saying no one was harmed, they are missing the point. They did actual harm to the court system, to the rule of law. We don’t say, ‘You can perjure yourself on the stand because the jury will come to the right verdict anyway.’ That’s what they are saying.”
Robert Willens, a tax expert, said that documentation issues had created potentially severe tax problems for investors in mortgage securities and that there was “enough of a question here that the courts might well have to resolve the issue.”
As the legal system begins sorting through the competing claims, one thing is not in dispute: The pell-mell origination of mortgage loans during the real estate boom and the patchwork of financial machinery and documentation that supported it were created with speed and profits in mind, and with little attention to detail.
As lenders and Wall Street firms bundled thousands of mortgage loans into securities so they could be sold quickly, efficiently and lucratively to legions of investors, slipshod practices took hold among lenders and their representatives, former employees of these operations say.
Banks routinely failed to record each link in the chain of documents that demonstrate ownership of a note and a property, according to court documents, analysts and interviews. When problems arose, executives and managers at lenders and loan servicers sometimes patched such holes by issuing affidavits meant to prove control of a mortgage.
In Broward County, Florida, alone, more than 1,700 affidavits were filed in the last two years attesting to lost notes, according to Legalprise, a legal services company that tracks foreclosure data.
When many mortgage loans went bad in the last few years, lenders outsourced crucial tasks like verifying the amount a borrower owed or determining which institution had a right to foreclose.
Now investors who bought mortgage trusts – investment vehicles composed of mortgages – are wondering whether the loans inside them were recorded properly. If not, tax advantages of the trusts could be wiped out, leaving investors with significant tax bills.
For years, lenders bringing foreclosure cases commonly did not have to demonstrate proof of ownership of the note. Consumer advocates and consumer lawyers have complained about the practice, to little avail.
But a decision in October 2007 by Judge Christopher A. Boyko of U.S. District Court in northern Ohio to toss out 14 foreclosure cases put lenders on notice. Judge Boyko ruled that the entities trying to seize the properties had not proved that they actually owned the notes, and he blasted the banks for worrying “less about jurisdictional requirements and more about maximizing returns.”
He also said that lenders “seem to adopt the attitude that since they have been doing this for so long, unchallenged, this practice equates with legal compliance.” Now that their practices have been “put to the test, their weak legal arguments compel the court to stop them at the gate,” the judge ruled.
Source: 2010 International Herald Tribune.
About a month after Washington Mutual Bank made a multimillion-dollar mortgage loan on a mountain home near Santa Barbara, California, a crucial piece of paperwork disappeared.
But bank officials were unperturbed. After conducting a “due and diligent search,” an assistant vice president simply drew up an affidavit stating that the paperwork – a promissory note committing the borrower to repay the mortgage – could not be found, according to court documents.
The handling of that lost note in 2006 was hardly unusual. Mortgage documents of all sorts were treated in an almost lackadaisical way during the dizzying mortgage lending spree from 2005 through 2007, according to court documents, analysts and interviews.
Now those missing and possibly fraudulent documents are at the center of a potentially seismic legal clash that pits big lenders against homeowners and their advocates who are concerned that the lenders’ rush to foreclose flouts private property rights.
That clash – expected to be played out in courtrooms across the United States and scrutinized by law enforcement officials investigating possible wrongdoing by big lenders – leaped to the forefront of the mortgage crisis this week as big lenders began lifting their freezes on foreclosures and insisted the worst was behind them.
U.S. government officials meeting in Washington on Wednesday indicated that a government review of the problems would not be complete until the end of the year.
In short, the legal disagreement amounts to whether banks can rely on flawed documentation to repossess homes.
While even critics of the big lenders acknowledge that the vast majority of foreclosures involve homeowners who have not paid their mortgages, they argue that the borrowers are entitled to due legal process.
Banks “have essentially sidestepped 400 years of property law in the United States,” said Rebel A. Cole, a professor of finance and real estate at DePaul University in Chicago. “There are so many questionable aspects to this thing it’s scary.”
The country’s mortgage lenders contend that any problems that might be identified are technical and will not change the fact that they have the right to foreclose en masse.
“We did a thorough review of the process, and we found the facts underlying the decision to foreclose have been accurate,” Barbara J. Desoer, president of Bank of America Home Loans, said this week. “We paused while we were doing that, and now we’re moving forward.”
Some analysts are not sure that banks can proceed so freely. Katherine M. Porter, a visiting law professor at Harvard University and an expert on consumer credit law, said that lenders were wrong to minimize problems with the legal documentation.
“The misbehavior is clear: They lied to the courts,” she said. “The fact that they are saying no one was harmed, they are missing the point. They did actual harm to the court system, to the rule of law. We don’t say, ‘You can perjure yourself on the stand because the jury will come to the right verdict anyway.’ That’s what they are saying.”
Robert Willens, a tax expert, said that documentation issues had created potentially severe tax problems for investors in mortgage securities and that there was “enough of a question here that the courts might well have to resolve the issue.”
As the legal system begins sorting through the competing claims, one thing is not in dispute: The pell-mell origination of mortgage loans during the real estate boom and the patchwork of financial machinery and documentation that supported it were created with speed and profits in mind, and with little attention to detail.
As lenders and Wall Street firms bundled thousands of mortgage loans into securities so they could be sold quickly, efficiently and lucratively to legions of investors, slipshod practices took hold among lenders and their representatives, former employees of these operations say.
Banks routinely failed to record each link in the chain of documents that demonstrate ownership of a note and a property, according to court documents, analysts and interviews. When problems arose, executives and managers at lenders and loan servicers sometimes patched such holes by issuing affidavits meant to prove control of a mortgage.
In Broward County, Florida, alone, more than 1,700 affidavits were filed in the last two years attesting to lost notes, according to Legalprise, a legal services company that tracks foreclosure data.
When many mortgage loans went bad in the last few years, lenders outsourced crucial tasks like verifying the amount a borrower owed or determining which institution had a right to foreclose.
Now investors who bought mortgage trusts – investment vehicles composed of mortgages – are wondering whether the loans inside them were recorded properly. If not, tax advantages of the trusts could be wiped out, leaving investors with significant tax bills.
For years, lenders bringing foreclosure cases commonly did not have to demonstrate proof of ownership of the note. Consumer advocates and consumer lawyers have complained about the practice, to little avail.
But a decision in October 2007 by Judge Christopher A. Boyko of U.S. District Court in northern Ohio to toss out 14 foreclosure cases put lenders on notice. Judge Boyko ruled that the entities trying to seize the properties had not proved that they actually owned the notes, and he blasted the banks for worrying “less about jurisdictional requirements and more about maximizing returns.”
He also said that lenders “seem to adopt the attitude that since they have been doing this for so long, unchallenged, this practice equates with legal compliance.” Now that their practices have been “put to the test, their weak legal arguments compel the court to stop them at the gate,” the judge ruled.
Source: 2010 International Herald Tribune.
Mortgage rates rise to 4.21% from decades low
Rates on 30-year fixed mortgages rose slightly from their lowest level in decades, inching up to a national average of 4.21 percent.
Mortgage buyer Freddie Mac says the average rate for 30-year fixed loans was up from 4.19 percent the previous week. That was the lowest level on records dating back to 1971.
The average rate on 15-year fixed loans rose to 3.64 percent. That was up from 3.62 percent a week earlier, the lowest weekly average on records dating back to 1991.
Rates have been falling since April. The latest declines are largely because investors have been buying up Treasury bonds in anticipation of the Federal Reserve’s likely move to buy Treasurys to stimulate the economy. That demand lowers Treasury yields, which mortgage rates tend to track.
Low rates haven’t helped the struggling housing market, which recorded its worst summer in more than a decade. But they have led to a modest surge in refinancing.
To calculate average mortgage rates, Freddie Mac collects rates from lenders around the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a given day.
Rates on five-year adjustable-rate mortgages averaged 3.45 percent, up from 3.47 percent a week earlier. Rates on one-year adjustable-rate mortgages fell to an average of 3.3 percent from 3.43 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount. The nationwide fee for loans in Freddie Mac’s survey averaged 0.8 a point for 30-year. It averaged 0.7 of a point for 15-year and 1-year mortgages and 0.6 of a point for 5-year mortgages.
Source: The Associated Press, Alan Zibel, AP real estate writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Mortgage buyer Freddie Mac says the average rate for 30-year fixed loans was up from 4.19 percent the previous week. That was the lowest level on records dating back to 1971.
The average rate on 15-year fixed loans rose to 3.64 percent. That was up from 3.62 percent a week earlier, the lowest weekly average on records dating back to 1991.
Rates have been falling since April. The latest declines are largely because investors have been buying up Treasury bonds in anticipation of the Federal Reserve’s likely move to buy Treasurys to stimulate the economy. That demand lowers Treasury yields, which mortgage rates tend to track.
Low rates haven’t helped the struggling housing market, which recorded its worst summer in more than a decade. But they have led to a modest surge in refinancing.
To calculate average mortgage rates, Freddie Mac collects rates from lenders around the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a given day.
Rates on five-year adjustable-rate mortgages averaged 3.45 percent, up from 3.47 percent a week earlier. Rates on one-year adjustable-rate mortgages fell to an average of 3.3 percent from 3.43 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount. The nationwide fee for loans in Freddie Mac’s survey averaged 0.8 a point for 30-year. It averaged 0.7 of a point for 15-year and 1-year mortgages and 0.6 of a point for 5-year mortgages.
Source: The Associated Press, Alan Zibel, AP real estate writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Wells Fargo Declaration, New York Legislation
Wells Fargo says it has no plans to freeze foreclosures today or in the future. Since the beginning of the “robo-signing” scandal, where large banks allegedly processed hundreds of thousands of foreclosure documents improperly, Wells Fargo has maintained that its processes have been thorough and in accordance with the law.
John Stumpf, Chairman and CEO of Wells Fargo, released the following statement: “We are confident that our practices, procedures and documentation for both foreclosures and mortgage securitizations are sound and accurate. For those reasons, we did not, and have no plans to, initiate a moratorium on foreclosures.”
Also, in a possible sign of what’s to come in the 23 states requiring judicial review for foreclosure, New York became first state to pass legislation requiring attorneys handling residential foreclosures to sign an affidavit that they took “reasonable” steps to review and verify the accuracy of foreclosure paperwork. Jonathan Lippman, chief judge of the New York Court of Appeals, estimated that there are 80,000 foreclosure actions pending in the state’s courts.
John Stumpf, Chairman and CEO of Wells Fargo, released the following statement: “We are confident that our practices, procedures and documentation for both foreclosures and mortgage securitizations are sound and accurate. For those reasons, we did not, and have no plans to, initiate a moratorium on foreclosures.”
Also, in a possible sign of what’s to come in the 23 states requiring judicial review for foreclosure, New York became first state to pass legislation requiring attorneys handling residential foreclosures to sign an affidavit that they took “reasonable” steps to review and verify the accuracy of foreclosure paperwork. Jonathan Lippman, chief judge of the New York Court of Appeals, estimated that there are 80,000 foreclosure actions pending in the state’s courts.
Thursday, October 21, 2010
Study: More women in commercial real estate
According to a new study, "Women in Commercial Real Estate: 2010" by the Commercial Real Estate Women Network, more women have found work in the commercial real estate field in the past five years. However, the wage gap between men and women remains an issue.
According to the research, there has been a 7 percent increase in women entering the commercial real estate field since 2005. That year, women represented 36 percent of commercial practitioners. Today, that total has jumped to 43 percent.
The study further found that more women are now in the $100,000 to $250,000 per year salary category, but that’s still fewer than their male counterparts.
Five years ago, 8 percent of females polled were at the $250,000 level. By this year, the number had increased to 11 percent. By comparison, male commercial property professionals saw a decrease from 34 percent to 31 percent over that same time span.
Finally, men still hold the majority of top executive positions. In the study, 9 percent of women respondents reported holding the position of president, CEO, COO or CFO versus 22 percent of male respondents.
The study is a follow-up to a similar one conducted by the network in 2005.
Source: Dayton Business Journal (10/19/10) Demeropolis, Tom
Source: INFORMATION, INC. Bethesda, MD
According to the research, there has been a 7 percent increase in women entering the commercial real estate field since 2005. That year, women represented 36 percent of commercial practitioners. Today, that total has jumped to 43 percent.
The study further found that more women are now in the $100,000 to $250,000 per year salary category, but that’s still fewer than their male counterparts.
Five years ago, 8 percent of females polled were at the $250,000 level. By this year, the number had increased to 11 percent. By comparison, male commercial property professionals saw a decrease from 34 percent to 31 percent over that same time span.
Finally, men still hold the majority of top executive positions. In the study, 9 percent of women respondents reported holding the position of president, CEO, COO or CFO versus 22 percent of male respondents.
The study is a follow-up to a similar one conducted by the network in 2005.
Source: Dayton Business Journal (10/19/10) Demeropolis, Tom
Source: INFORMATION, INC. Bethesda, MD
New report: Amendment 4 passage would have ‘devastating consequences’
Florida TaxWatch released a new report this morning on the potential outcome of Amendment 4 passage on Nov. 2. According to the report, passage would severely harm the state’s economic recovery, future job creation, and dampen personal income.
The economic impact analysis, "Land Use Planning by Referendum: The Economic Consequences of Amendment 4" – conducted by the Florida Council of Economic Advisors at Florida TaxWatch and a team of researchers from the Haas Center at the University of West Florida – explains the future if Amendment 4 passes, which would require voter approval of all changes to local comprehensive land use plans that cities and counties use as a specific outline for future development.
“During the Great Recession, when Florida has double digit unemployment, the most important issue with Amendment 4 is its effect on our economy and the taxpayers of Florida,” says Dominic M. Calabro, president and CEO of Florida TaxWatch, a non-partisan, non-profit public policy think tank and state government watchdog based in Tallahassee. “This analysis reveals that Amendment 4 will cost Floridians more than 250,000 jobs at a time when more than 1 million Floridians are out of work. Amendment 4 imprudently adds another layer of cost to the taxpayers while jeopardizing Florida’s long-term growth and prosperity. This analysis shows that Florida simply cannot afford Amendment 4 and it should not be in Florida’s Constitution.”
The analysis estimates that Amendment 4 would cost:
• More than 260,000 jobs
• $16.7* billion in personal income
• $21.6 billion* in Gross State Product
• $2.2 billion* in state tax revenue
• $227 million loss in property taxes – approximately $3.4 million per county
(*Estimates are average over six years in constant 2010 dollars)
“The economic impact of Amendment 4 is likely to be quite large, and the unintended consequences accompanying them are a much more severe set of problems than we see now,” says Dr. Rick Harper, director of the Haas Center. “As the state economy recovers, these effects will grow substantially. There is little doubt that developers and investors will consider the increased uncertainty associated with Amendment 4 and many may decide that the risk is too high and locate elsewhere – taking jobs and economic growth with them. The negative economic consequences of Amendment 4 are likely severe, long lasting and difficult to reverse once initiated.”
Among some of the effects: a steep decrease in jobs, particularly high-wage jobs, over the next three years; losses in personal income that persist over time; decreased housing affordability; and lower tax revenue collections, which may lead to increased taxes and fees in order to fill the budget gap.
The new report follows on the heels of an earlier briefing by Florida TaxWatch. This report estimates the fiscal impact of voter approval for all changes to comprehensive land use plans. It found that passage of Amendment 4 would result in hundreds, if not thousands, of elections, which would incur millions of dollars in costs at the taxpayers’ expense. The Florida TaxWatch analysis estimates that the direct cost to the taxpayers throughout Florida for these special elections would be $44.6 million to $83.4 million annually. That analysis further estimates that litigation resulting from the additional and expanded elections required under Amendment 4 could result in legal costs to local governments of more than $1 billion annually – or more than $135 per Florida household annually.
“Instead of risking hundreds of thousands of jobs as well as our state’s economic recovery by marking up Florida’s Constitution, Florida should instead focus on making improvements to the existing growth management structure and process to ameliorate growth management issues to promote healthy investment,” adds Calabro.
The analysis uses Regional Economic Modeling Inc. (REMI) model of the Florida economy – a dynamic econometric forecasting tool used by the Florida Legislature that calculates the direct, indirect and induced effects on economic activities such as spending and employment that results from a policy change – with three scenarios to calculate the long term effect of Amendment 4.
Dr. Stefan Norrbin, professor of economics and the director of the master’s program in economics at Florida State University, conducted an independent review of the study’s model, methodology and the plausibility of assumptions made.
Norrbin: “It is my best professional judgment that the study has used plausible assumption of the parameters needed to make an informed decision about Amendment 4, and has used state of the art modeling and methodology to estimate the impact of the proposed Amendment 4.”
Dr. Stephen Morrell, professor of economics and finance at Barry University and chair of the Florida Council of Economic Advisors at Florida TaxWatch: “My review concluded that the empirical economic and fiscal impact estimates presented in the Haas Centers study should be viewed as highly credible and accurate.”
The complete study is available online in PDF format: http://www.floridataxwatch.org/resources/pdf/10202010Amendment4v2.pdf
Source: Florida Realtors®
The economic impact analysis, "Land Use Planning by Referendum: The Economic Consequences of Amendment 4" – conducted by the Florida Council of Economic Advisors at Florida TaxWatch and a team of researchers from the Haas Center at the University of West Florida – explains the future if Amendment 4 passes, which would require voter approval of all changes to local comprehensive land use plans that cities and counties use as a specific outline for future development.
“During the Great Recession, when Florida has double digit unemployment, the most important issue with Amendment 4 is its effect on our economy and the taxpayers of Florida,” says Dominic M. Calabro, president and CEO of Florida TaxWatch, a non-partisan, non-profit public policy think tank and state government watchdog based in Tallahassee. “This analysis reveals that Amendment 4 will cost Floridians more than 250,000 jobs at a time when more than 1 million Floridians are out of work. Amendment 4 imprudently adds another layer of cost to the taxpayers while jeopardizing Florida’s long-term growth and prosperity. This analysis shows that Florida simply cannot afford Amendment 4 and it should not be in Florida’s Constitution.”
The analysis estimates that Amendment 4 would cost:
• More than 260,000 jobs
• $16.7* billion in personal income
• $21.6 billion* in Gross State Product
• $2.2 billion* in state tax revenue
• $227 million loss in property taxes – approximately $3.4 million per county
(*Estimates are average over six years in constant 2010 dollars)
“The economic impact of Amendment 4 is likely to be quite large, and the unintended consequences accompanying them are a much more severe set of problems than we see now,” says Dr. Rick Harper, director of the Haas Center. “As the state economy recovers, these effects will grow substantially. There is little doubt that developers and investors will consider the increased uncertainty associated with Amendment 4 and many may decide that the risk is too high and locate elsewhere – taking jobs and economic growth with them. The negative economic consequences of Amendment 4 are likely severe, long lasting and difficult to reverse once initiated.”
Among some of the effects: a steep decrease in jobs, particularly high-wage jobs, over the next three years; losses in personal income that persist over time; decreased housing affordability; and lower tax revenue collections, which may lead to increased taxes and fees in order to fill the budget gap.
The new report follows on the heels of an earlier briefing by Florida TaxWatch. This report estimates the fiscal impact of voter approval for all changes to comprehensive land use plans. It found that passage of Amendment 4 would result in hundreds, if not thousands, of elections, which would incur millions of dollars in costs at the taxpayers’ expense. The Florida TaxWatch analysis estimates that the direct cost to the taxpayers throughout Florida for these special elections would be $44.6 million to $83.4 million annually. That analysis further estimates that litigation resulting from the additional and expanded elections required under Amendment 4 could result in legal costs to local governments of more than $1 billion annually – or more than $135 per Florida household annually.
“Instead of risking hundreds of thousands of jobs as well as our state’s economic recovery by marking up Florida’s Constitution, Florida should instead focus on making improvements to the existing growth management structure and process to ameliorate growth management issues to promote healthy investment,” adds Calabro.
The analysis uses Regional Economic Modeling Inc. (REMI) model of the Florida economy – a dynamic econometric forecasting tool used by the Florida Legislature that calculates the direct, indirect and induced effects on economic activities such as spending and employment that results from a policy change – with three scenarios to calculate the long term effect of Amendment 4.
Dr. Stefan Norrbin, professor of economics and the director of the master’s program in economics at Florida State University, conducted an independent review of the study’s model, methodology and the plausibility of assumptions made.
Norrbin: “It is my best professional judgment that the study has used plausible assumption of the parameters needed to make an informed decision about Amendment 4, and has used state of the art modeling and methodology to estimate the impact of the proposed Amendment 4.”
Dr. Stephen Morrell, professor of economics and finance at Barry University and chair of the Florida Council of Economic Advisors at Florida TaxWatch: “My review concluded that the empirical economic and fiscal impact estimates presented in the Haas Centers study should be viewed as highly credible and accurate.”
The complete study is available online in PDF format: http://www.floridataxwatch.org/resources/pdf/10202010Amendment4v2.pdf
Source: Florida Realtors®
Obama official says banks can restart foreclosures
President Barack Obama’s top housing official said Wednesday that lenders are within their rights to resume foreclosures this month despite allegations that they erred in processing documents. But he said the banks could face fines if found to have broken the law.
“They’ve made a business decision,” Shaun Donovan, the secretary of housing and urban development, said in an interview at the White House.
Two big lenders – Bank of America Corp. and Ally Financial Inc.’s GMAC Mortgage unit – are restarting foreclosures after halting them temporarily. They had frozen those cases amid allegations that employees signed but didn’t read foreclosure documents that may have contained errors. The companies say they’re fixing the problems in the documents.
Donovan noted that several federal agencies, including his department and the Federal Trade Commission, have authority to penalize mortgage companies if they’re found to have violated the law.
“We are going to hold them accountable,” he said.
The housing secretary discussed the foreclosure document mess earlier in the day with officials from 11 federal agencies that are reviewing the issue. He said the government is also in contact with 50 state attorneys general who have launched their own inquiry.
Donovan said the government has found no evidence that the system used to handle foreclosures is flawed, even though some banks may not have followed proper procedures.
A federal law enforcement official told the Associated Press on Tuesday that the FBI is trying to determine whether the financial industry broke criminal laws in the mortgage foreclosure crisis.
The law enforcement official said the question is whether some in the industry were acting with criminal intent or were merely overwhelmed after the housing market’s collapse. The official spoke on condition of anonymity because the investigation is just getting under way.
In a related inquiry, Donovan said the Federal Housing Administration has found disparities in how five major lenders have responded to distressed homeowners. He said the FHA reached that conclusion after a four-month review. He declined to name the lenders.
The government has authority to fine lenders that fail to comply with guidelines of the FHA, which guarantees some home loans.
Some lawmakers have called for a national halt to foreclosures. The Obama administration opposes such a move. It says doing so could hurt the housing market by making it harder for buyers of foreclosed homes to complete their transactions.
In an interview earlier this week, Rep. Barney Frank, D-Mass., the chairman of the House Financial Services Committee, said he also didn’t support a nationwide foreclosure freeze.
“It never seemed to me that the great majority of these foreclosures were going to be invalid,” he said.
Frank said, though, that lawmakers should work next year to enact tighter regulations over the industry.
Source: The Associated Press, Alan Zibel, AP real estate writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
“They’ve made a business decision,” Shaun Donovan, the secretary of housing and urban development, said in an interview at the White House.
Two big lenders – Bank of America Corp. and Ally Financial Inc.’s GMAC Mortgage unit – are restarting foreclosures after halting them temporarily. They had frozen those cases amid allegations that employees signed but didn’t read foreclosure documents that may have contained errors. The companies say they’re fixing the problems in the documents.
Donovan noted that several federal agencies, including his department and the Federal Trade Commission, have authority to penalize mortgage companies if they’re found to have violated the law.
“We are going to hold them accountable,” he said.
The housing secretary discussed the foreclosure document mess earlier in the day with officials from 11 federal agencies that are reviewing the issue. He said the government is also in contact with 50 state attorneys general who have launched their own inquiry.
Donovan said the government has found no evidence that the system used to handle foreclosures is flawed, even though some banks may not have followed proper procedures.
A federal law enforcement official told the Associated Press on Tuesday that the FBI is trying to determine whether the financial industry broke criminal laws in the mortgage foreclosure crisis.
The law enforcement official said the question is whether some in the industry were acting with criminal intent or were merely overwhelmed after the housing market’s collapse. The official spoke on condition of anonymity because the investigation is just getting under way.
In a related inquiry, Donovan said the Federal Housing Administration has found disparities in how five major lenders have responded to distressed homeowners. He said the FHA reached that conclusion after a four-month review. He declined to name the lenders.
The government has authority to fine lenders that fail to comply with guidelines of the FHA, which guarantees some home loans.
Some lawmakers have called for a national halt to foreclosures. The Obama administration opposes such a move. It says doing so could hurt the housing market by making it harder for buyers of foreclosed homes to complete their transactions.
In an interview earlier this week, Rep. Barney Frank, D-Mass., the chairman of the House Financial Services Committee, said he also didn’t support a nationwide foreclosure freeze.
“It never seemed to me that the great majority of these foreclosures were going to be invalid,” he said.
Frank said, though, that lawmakers should work next year to enact tighter regulations over the industry.
Source: The Associated Press, Alan Zibel, AP real estate writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Fidelity National, Bank of America in foreclosure deal
Title insurer Fidelity National Financial Inc. on Wednesday said it reached an agreement with Bank of America that it hopes will protect it from losses related to the uproar over mortgage lenders accused of cutting corners on foreclosure paperwork and legal procedures.
Jacksonville, Fla.-based Fidelity National said Bank of America Corp. will be required to show that all documentation and procedures related to the foreclosure of a property comply with state law and local practice. The Charlotte, N.C., bank will also cover any losses Fidelity National faces that are directly related to its failure to comply with laws on transactions in which foreclosure has already occurred or will take place.
The deal comes amid accusations that mortgage lenders nationwide cut corners as they moved to seize millions of homes. Lenders won’t issue mortgages without title insurance, which protects a homebuyer and mortgage provider in case any unpaid taxes, questionable ownership or other problems surface. Title insurers are trying to come up with a way to ensure they don’t have to pay claims to the buyer of a foreclosed home if inaccuracies end up voiding the home purchase.
Bank of America, the nation’s largest bank, has suspended foreclosures in all 50 states while it checks to see if employees made errors in loan documents needed to complete foreclosures. It has said it will resume the proceedings next week.
“We believe that this agreement reflects current law in every state and is consistent with the rights that we have under the policies we issue,” said Fidelity National Chairman William P. Foley in a statement. Fidelity National will also require guaranties on future foreclosure-related transactions from all other lenders.
JPMorgan Chase & Co., Ally Financial’s GMAC Mortgage unit and PNC Financial have also stopped foreclosures in some states while they review procedures. Attorneys general in all 50 states and the District of Columbia are jointly investigating whether mortgage companies have violated state laws.
Fidelity National said it does not believe that this situation will have a material adverse impact on its title business. The company said it believes policies written to new purchasers of foreclosed homes will not result in additional claims exposure “because the new owners and their lenders would have the rights of good faith purchasers which should not be affected by potential defects in documentation.
“Even if a court sets aside a foreclosure due to a defect in documentation, the foreclosing lender would be required to return all funds obtained from our insureds, resulting in no loss under the title insurance policy,” Fidelity National said.
The details of the deal with Bank of America were disclosed at the same time Fidelity National posted a 13 percent increase in third-quarter profit, boosted by increased sales of specialty insurance, investment gains and cost cutting.
Source: The Associated Press, Eileen A.J. Connelly, AP business writer.
Jacksonville, Fla.-based Fidelity National said Bank of America Corp. will be required to show that all documentation and procedures related to the foreclosure of a property comply with state law and local practice. The Charlotte, N.C., bank will also cover any losses Fidelity National faces that are directly related to its failure to comply with laws on transactions in which foreclosure has already occurred or will take place.
The deal comes amid accusations that mortgage lenders nationwide cut corners as they moved to seize millions of homes. Lenders won’t issue mortgages without title insurance, which protects a homebuyer and mortgage provider in case any unpaid taxes, questionable ownership or other problems surface. Title insurers are trying to come up with a way to ensure they don’t have to pay claims to the buyer of a foreclosed home if inaccuracies end up voiding the home purchase.
Bank of America, the nation’s largest bank, has suspended foreclosures in all 50 states while it checks to see if employees made errors in loan documents needed to complete foreclosures. It has said it will resume the proceedings next week.
“We believe that this agreement reflects current law in every state and is consistent with the rights that we have under the policies we issue,” said Fidelity National Chairman William P. Foley in a statement. Fidelity National will also require guaranties on future foreclosure-related transactions from all other lenders.
JPMorgan Chase & Co., Ally Financial’s GMAC Mortgage unit and PNC Financial have also stopped foreclosures in some states while they review procedures. Attorneys general in all 50 states and the District of Columbia are jointly investigating whether mortgage companies have violated state laws.
Fidelity National said it does not believe that this situation will have a material adverse impact on its title business. The company said it believes policies written to new purchasers of foreclosed homes will not result in additional claims exposure “because the new owners and their lenders would have the rights of good faith purchasers which should not be affected by potential defects in documentation.
“Even if a court sets aside a foreclosure due to a defect in documentation, the foreclosing lender would be required to return all funds obtained from our insureds, resulting in no loss under the title insurance policy,” Fidelity National said.
The details of the deal with Bank of America were disclosed at the same time Fidelity National posted a 13 percent increase in third-quarter profit, boosted by increased sales of specialty insurance, investment gains and cost cutting.
Source: The Associated Press, Eileen A.J. Connelly, AP business writer.
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