Top 10 Metro Areas with the Highest Foreclosure Rates

October 26th, 2012

It is no secret that loan defaults have taken their toll on the housing sector in the United States. Many government relief initiatives have been extended to distressed homeowners in an effort to minimize foreclosures. One of the most popular choices for struggling borrowers has been the bad credit FHA loan because it offered low interest rates and lenient credit requirements. The Federal Housing Administration continues to insure loans for people with fico scores as low as 500.

When Will Home Foreclosure Rates in the U.S. Fall?

While the number of foreclosures in the nation has fallen to half the peak rate of the crisis, people are still losing their houses to the bank in certain regions at high rates. According to RealtyTrac,  from January 2007, shortly after the housing bubble exploded, through September 2012, about one in 29 housing units have been foreclosed. In Sept. 2012, there were 180,000 housing units with foreclosure filings. During the peak of the foreclosure crisis, March 2010, there were 367,000 properties with a foreclosure filing.

However, Daren Blomquist, vice president at RealtyTrac, said a “normal” housing market will have about 75,000 properties with foreclosure filings. “We have more than halfway back to normal,” he said. California is still mired in foreclosures, as the seven cities with the highest foreclosure rates using data from Sept. 2012 are all in the Golden State.”It speaks to the depth of the housing crisis in those markets,” Blomquist said.

As a result, there has been a 45% increase in short-sales during the first five months of 2012, compared with the same period in 2011. RealtyTrac has measured the average time it takes from when banking institute start a foreclosure to when a property is foreclosed. Nationally this process averages 380 days. However in states like Illinois and New York, that foreclosure process averages nearly to 700 days.

Here are the metropolitan areas with the ten highest foreclosure rates:

1. Stockton, California

One in every 67 homes in foreclosure

2. Riverside-San Bernardino-Ontario, California

One in every 73 homes in foreclosure

3. Vallejo-Fairfield, California

One in every 78 homes in foreclosure

4. Modesto, California

One in every 79 homes in foreclosure

5. Merced, California

One in every 83 homes in foreclosure

6. Bakersfield, California

One in every 87 homes in foreclosure

7 Sacramento-Arden-Arcade-Roseville, California

One in every 96 homes in foreclosure

8. Rockford, Illinois

One in every 98 homes in foreclosure

9. Chicago-Naperville-Joliet, Illinois

One in every 98 homes in foreclosure

10. Miami-Fort Lauderdale-Pompano Beach, Florida

One in every 100 homes in foreclosure

Read the original ABC News Article on Foreclosure Rates.

Foreclosure News, Housing Crisis Articles

Government Mortgage Help with Loan Modification Plans

December 28th, 2011

Since the housing crisis exploded in 2006, we have seen banks offer more loan modification plans than ever before. Foreclosures hаvе bееn оn thе rise еvеr sіnсе recession started and banks are extending mortgage help to struggling homeowners everywhere. Increased unemployment, declining household income, аnd unregulated bank behavior саusе mаnу homeowners tо slip оn thеіr mortgage payments аnd face foreclosure. U.Ѕ. Government hаs mаdе sіgnіfісаnt steps tо regulate thе mortgage industry, aiming tо limit foreclosure rates thrоugh government mortgage reduction programs.

Payment Reduction Plan, commonly abbreviated аs PRP, іs а governmental program aimed tо mаkе mortgage payments mоrе affordable tо American families. Іt allows fоr reduction оf mortgage payments uр tо 30%, depending оn individual circumstances. Тhе great benefit оf PRP іs thаt іt іs аvаіlаblе tо people whо hаvе аlrеаdу defaulted оn thеіr mortgages аnd whо аrе nоt eligible fоr thе Ноmе Affordable Modification Program. Тhіs loan modification program іs аlsо excellent fоr homeowners whо оwn mоrе thаn оnе house, аs іt allows fоr participation оf nоn owner-occupied properties. Тhе forbearance period undеr thіs program іs sіх months, durіng whісh bоth, thе lender аnd thе borrower, develop аn acceptable repayment plan aimed tо prevent foreclosure. Іn case thе plan іs а success, а loan servicer іs compensated usіng general governmental incentives аnd а processing fee. Securing a mortgage refinance loan is simply not as easy as it should be.

Home Affordable Modification Program

The Ноmе Affordable Modification Program (HAMP) іs а vital solution fоr homeowners whо usе thеіr property аs а primary residence аnd аrе аt а risk оf foreclosure. HAMP hаs sеvеrаl criteria tо include thе following:

•          Financial hardship, causing а foreclosure оr а risk оf а foreclosure;

•          Loan origination dаtе оf January 1, 2009 оr earlier;

•          Principal mortgage balance аt thе dаtе оf application bеіng equal tо, оr lesser оf $729,750;

•          Outstanding mortgage amount dоеs nоt exceed 125% оf thе hоmе market value.

HAMP mау help homeowners tо reduce thеіr payments bу uр tо 50%, bеіng nо mоrе thаn 38% оf thе monthly income оf thе homeowner, thrоugh а variety оf instruments. Ѕuсh instruments include interest rate reduction, loan period extension, and/or principal reduction. Whіlе lender participation іs voluntary, lenders аrе encouraged tо participate bу attractive incentives аnd fees paid bу U.Ѕ. Government. Еvеrу approved HAMP application gеts lenders $1,000. Іn addition, lenders receive $1,000 еvеrу year fоr thе fіrst three years оf timely modified mortgage payments mаdе bу thе borrower. Responsible borrowers аlsо gеt thеіr chunk оf government money undеr HAMP – $1,000 реr year uр tо fіvе years, provided thеу honor thеіr obligations. If you are unable to qualify for a mortgage refinancing with a fixed rate, then consider a loan modification for quick payment relief.

Beware Оf Scams

People whо аrе desperate, risking losing thеіr hоmе, оftеn fall thе victims оf scammers whо offer guaranteed approval fоr PRP аnd HAMP аnd expeditious processing іn exchange fоr а sum оf money. Маnу scammers аlsо mаkе homeowners bеlіеvе thаt thеrе аrе fees associated wіth thеsе government programs. Νеvеr pay аnу money fоr counseling оr fоr guaranteed acceptance іntо thеsе programs. Νоbоdу саn guarantee уоu аn approval аs thеsе scammers dо nоt hаvе а final sау іn thе application process.

There іs plenty оf іnfоrmаtіоn аvаіlаblе online listed оn official program websites, аs well аs thrоugh legitimate participating refinancing lenders. Іn addition, thеrе аrе well-qualified nonprofit agencies offering eligibility assessment аnd initial consultations free оf charge thаt mау help уоu tо determine іf уоu аrе eligible аnd advice оf furthеr steps уоu wоuld hаvе tо tаkе іn order tо benefit frоm PRP аnd HAMP.

Housing Crisis Articles, Loan Modification News

Exploring the Causes of Financial and Housing Crisis

January 26th, 2011

Today, six members of the Financial Crisis Inquiry Commission, created by the last Congress to investigate the causes of the financial crisis are releasing their final report. Although the three of us served on the commission, we were unable to support the majority’s conclusions and have issued a dissenting statement.

Failures in credit-rating and securitization transformed bad mortgages into toxic financial assets (factor 4).  Securitizers lowered the credit standards and promoted bad credit mortgage programs that they securitized, credit-rating agencies erroneously rated these securities as safe investments, and buyers failed to look behind the ratings and do their own due diligence. Managers of many large and midsize financial institutions amassed enormous concentrations of highly correlated housing risk (factor 5), and they amplified this risk by holding too little capital relative to the risks and funded these exposures with short-term debt (factor 6). They assumed such funds would always be available. Both turned out to be bad bets.

Housing Bubble In a November 2009 article, Brookings Institution economists Martin Baily and Douglas Elliott describe the three common narratives about the financial crisis.

The first argues that the primary cause was government intervention in the housing market.

This intervention, principally through Fannie Mae and Freddie Mac, inflated a housing bubble that triggered the current mortgage and housing crisis.

This is the view expressed by one of our co-commissioners in a separate dissent. The second narrative blames Wall Street and its influence in Washington. According to this narrative, greedy bankers knowingly manipulated the financial system and politicians in Washington to take advantage of homeowners and mortgage investors alike, intentionally jeopardizing the financial system while enjoying huge personal gains. That’s the view of the six majority commissioners.

WSJ subscribes to a third narrative a messier story that emphasizes both global economic forces and failures in U.S. policy and supervision. Though our explanation of the crisis doesn’t fit conveniently into the political order of Washington, we believe that it is far superior to the other two.  We recognize that the other two narratives have popular appeal: They each blame a clear entity, and thus outline a clear set of reform proposals. Had the government not supported housing subsidies (the first narrative) or had policy makers implemented more restrictive financial regulations the second there would have been no calamity. Both of these views are incomplete and misleading. The existence of housing bubbles in a number of large countries, each with vastly different systems of housing finance, severely undercuts the thesis that the housing bubble was a phenomenon driven solely by the U.S. government. Likewise, the multitude of financial-firm failures, spanning varied organizational forms and differing regulatory regimes across the U.S. and Europe, makes it implausible that the crisis was the product of a small coterie of Wall Street bankers and their Washington bedfellows. We believe the crisis was the product of 10 factors. Only when taken together can they offer a sufficient explanation of what happened:

Starting in the late 1990s, there was a broad credit bubble in the U.S. and Europe and a sustained housing bubble in the U.S. (factors 1 and 2). Excess liquidity, combined with rising house prices and an ineffectively regulated primary mortgage market, led to an increase in nontraditional mortgages (factor 3) that were in some cases deceptive, in many cases confusing, and often beyond borrowers’ ability to pay. However, the credit bubble, housing bubble, and the explosion of nontraditional mortgage products are not by themselves responsible for the crisis. Our country has experienced larger bubbles—the dot-com bubble of the 1990s, for example—that were not nearly as devastating as the housing bubble. Losses from the housing downturn were concentrated in highly leveraged financial institutions. Which raises the essential question: Why were these firms so exposed?  > Read the rest of the WSJ article.

Housing Crisis Articles, Subprime Mortgage News ,

California Housing Crisis Still in Peril with Foreclosure Moratorium

October 5th, 2010

The housing crisis has certainly been the worst in high cost regions like California.  Mortgage rates in California dropped to all-time lows just last week, yet the foreclosure rate continues to rise.  A mortgage refinance in California is easier said than done as lending guidelines have tightened and most borrowers find themselves underwater with their property value being less than their mortgage.

California Housing Crisis

The California Housing Crisis Continues

Local homeowners hope that the house values will continue to rebound in 2013.

There are many questions that have been raised since Chase, Bank of America and Ally GMAC Mortgage said they would suspend certain foreclosure proceedings while they investigate legal paperwork in 23 states where lenders must foreclose against borrowers in court.  These are called judicial foreclosure states and California is not one of them. In California, lenders can foreclose in court but they almost always choose to do non-judicial foreclosures.  The three major banks temporarily halted certain foreclosure proceedings after it was revealed in depositions and testimony that some of the documents they filed in foreclosure cases were done in haste and might have had errors.

Will the Foreclosure Moratorium Hinder Economy?

According to Ladera Ranch realtor, Dan Ambrose, ” The short sale alternative has certainly helped many Southern California homeowners out of a pinch.” But Ambrose says, “There is still a lot of misinformation floating around out their but real mortgage relief is available. ” The fact that rates for 30-year mortgage refinancing have stayed below 3.5% for most of the year have helped stimulate an otherwise sluggish market.

The Associated Press reported last week that a Bank of America official said in a legal proceeding that she signed up to 8,000 foreclosure documents a month and typically didn’t read them.  In another case of what has been dubbed robo-signing, a GMAC foreclosure specialist said in a deposition that he had signed about 10,000 documents a month including affidavits of indebtedness.  “Some of the affidavits might not have been signed in the physical presence of a notary and some might have been signed without whoever signed them having personal knowledge of their contents,” says Gina Proia, a spokeswoman for GMAC, which is owned by Ally Financial  “This is really about the internal process, not about an individual. The process was changed a couple months ago,” she adds. GMAC has halted evictions and post-foreclosure home sales while it reviews affidavits in the 23 states, but it is continuing with other foreclosure proceedings.  “We don’t believe this procedural error led to any inappropriate foreclosures,” Proia says. Chase declined to comment. BofA did not return calls.

California Real Estate

MBA Opposed Obamas Reduction in Mortgage Interest Deductions

February 3rd, 2010

The Obama Administration released the Fiscal Year 2011 Budget.  Needless to say this budget will deeply effect many industries negatively, but specifically in this article the mortgage housing industry. Under the government finance programs like FHA mortgages, borrowers are able to get access to affordable financing with a minimal down-payment and no penalty for earl pay-off.

How can Obama really think that eliminating the mortgage interest write-offs for higher income homeowners will be good for the real estate market and the economy?

Adam Quinones wrote a good article about how Obama’s new budget would be a disaster for housing sector and mortgage industry in general.  He scanned the budget proposal for terms like mortgage, mortgage loan security, housing, community, GSE, government sponsored enterprise, Fannie Mae, Freddie Mac, etc, etc.

HERE is the message from the President. Its five pages long and basically re-iterates the above statement. This is how he ends his message: “These have been tough times, and there will be difficult months ahead. But the storms of the past are receding; the skies are brightening; and the horizon is beckoning once more “HUD SAYS: “HUD’s budget proposal seeks to make targeted investments in people and places – instead of policies and programs –to effectively support HUD’s mission while being accountable to the American taxpayer. $6.9 billion in projected FHA and Ginnie Mae receipts contribute to the FY 2011 proposed $48.5 billion budget total and to the administration’s deficit reduction plans. Net of the $6.9 billion in projected FHA and Ginnie Mae receipts the Budget proposes overall funding of $41.6 billion, 5% below fiscal year 2010, and makes difficult decisions to cut funding for a number of programs.”

The carefully targeted investments in the Budget will enable HUD programs to: House over 2.3 million families in public and assisted housing (over 58% elderly or disabled); Provide voucher assistance to 78,000 additional families (over 47% elderly or disabled);  Assist nearly 5.5 million households, over 200,000 more than at the end of fiscal year 2009.  More than double the annual rate at which HUD assistance creates new permanent supportive housing for the homeless; Create and retain over 112,000 jobs through the Department’s housing and economic development investments in communities across the country.

THE MORTGAGE BANKERS ASSOCIATION SAYS:

The Mortgage Bankers Association (MBA) issued the following reactions and analysis to the fiscal year 2011 federal budget, as proposed today by the Obama Administration.  “Reducing the federal deficit is vital to the long-term health of the US economy and our industry.  However, we believe it can and should be done without negatively impacting the already-fragile housing market,” said Robert E. Story, Jr., CMB, MBA’s Chairman.  “Limiting the mortgage interest deduction and imposing additional taxes on lenders will only make economic recovery more difficult.”

MBA opposes the proposal to reduce itemized deductions, including the deduction of mortgage interest, for taxpayers reporting income above $250,000 (joint) $200,000 (single).  This would have a negative impact on the housing market, particularly in high cost states like California and New York, as it would increase the cost of mortgages for many potential homeowners, especially those in high-cost states.    MBA also opposes the proposal to tax carried interest at ordinary tax rates (as opposed to the capital gains rate, as it is taxed now), as it would discourage capital formation for lending.

MBA believes the Financial Crisis Responsibility Fee will reduce the availability and increase the costs of real estate loans to consumers and small businesses by discouraging large financial institutions from entering into new, private label commercial mortgage backed securities (CMBS) and residential mortgage backed securities (RMBS) transactions and significantly reducing the profitability of non-agency servicing.

Story also noted that the budget did not offer any indications of the Administration’s plans for the future of Fannie Mae and Freddie Mac.”MBA has been at the forefront of the debate over the future of the government’s role in the second mortgage market,” said Story.  “We rolled out our proposal in September and have been meeting with all stakeholders on Capitol Hill, within the administration, and across the industry to share our perspectives.  Our proposal would provide a new foundation for supporting the core of the mortgage market.  We look forward to continuing our discussions as the administration readies its suggestions.”

MBA has supported the administration’s efforts to improve risk management of the Federal Housing Administration’s (FHA), and thus strongly supports the additional $18 million budgeted to allow FHA loans to implement its improved risk management systems.  MBA also supports the $20 million budgeted to combat predatory lending and mortgage fraud at HUD, as well as additional funding for housing counseling and foreclosure avoidance.”We are pleased to see increased funding for several critical programs at FHA,” added Story.  “We support both the efforts to help FHA better manage its risk.  We also support additional funding at HUD and the Department of Justice to combat mortgage fraud.  I also want to add how pleased I am to see that FHA’s multifamily programs are continuing to show strong performance in the face of the current challenges in the housing market.”

MBA also found troublesome the following additional provisions in the budget proposal: Termination of program authority to allow expensing (for tax purposes) of real estate environmental remediation, or “brownfields” clean up costs.  Reduced federal support for terrorism risk insurance program.  Read the original article online.

Foreclosure News, Home Financing, Housing Articles, Loss Mitigation Articles, Mortgage Industry, Mortgage News, Subprime Mortgage News

Averting the Mortgage Crisis

January 19th, 2010

Millions of homeowners are seeking mortgage refinancing or loan modifications in an effort to save their house or make their monthly payments more affordable. Unfortunately for mortgage brokers and lenders, mortgage refinance closings have slowed to very uncomfortable rate.  According to CFB Branch loan manager, Jeff Moran, most home refinance loan programs insured by the FHA are taking seven to eight weeks. Imagine owning a home loan company that had to cover four or five staff payrolls to fund a loan. Imagine paying underwriters, processors and loan officers to work on home loans that likely would not actually close. The mortgage business has seen brighter days. The credit crunch has caused lending guidelines to get tighter to the point that very few borrowers qualify for a home loan. Moran continued, “FHA loans have been the only lending product we can count on and fortunately the government loans will consider the borrower’s compensating factors for approvals.”

On the other hand loss mitigation companies have never has more business. With millions of have homeowners on the brink of foreclosure, people are lining up to help people modify their loan terms. With the recent $850 billion dollars from the Financial Bail-Out package, you can bet that loan modifications will only increase in 2009. Once we get past the foreclosure crisis most financial critics agree that home refinancing will resume back on its normal course.

About the Author: In addition to being the founder of Lead Planet and Nationwide Marketing, Bryan Dornan is a respected copywriter and lending executive who has published real estate articles online. Mr. Dornan suggests visiting the following web-pages: Search Marketing Company and for quality Mortgage Leads visit the Lead Planet online. Bryan Dornan is an experienced real estate consultant who publishes many interesting foreclosure prevention articles for many real estate blogs.  Article Source: http://EzineArticles.com/?expert=Bryan_Dornan

Foreclosure News, Loan Modification News, Loss Mitigation Articles, Mortgage Industry, Mortgage News ,

California Real Estate Rebounding?

January 8th, 2010

Everyone know the Southern California housing market has been hit hard the last few years, but many realtors believe the California real estate will actually rebound in 2010.  Yet most in the mortgage industry believe their are still a few years of correction coming to the California market.  California loan modifications and California Short Sales continue to play a dominant role in state real estate transactions, but now they are affecting the commercial market place.   Read the complete article > California Real Estate Update.

California Real Estate, Home Financing, Housing Articles, Mortgage Industry

Southern California Home Sales Up but Home Foreclosures Remain a Problem

October 13th, 2009

Southern California home sales rose higher last month, bolstered by late-closing summer transactions, low mortgage rates and buyers hoping to take advantage of a soon-to-expire tax credit. The region’s median sale price remained lower than in September 2008 but, for the first time in years, several counties logged year-over-year gains in the median price paid for resale houses, a real estate information service reported. Last month 21,539 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties. Getting a house loan with bad credit is often more difficult then getting approved for a note modification.

According to DataQuick, that was up 0.2% from 21,502 in August and up 5.1% from 20,497 a year earlier, September marked the 15th month in a row with a year-over-year sales gain, although last month’s was the smallest of those increases. Sales for the month of September have averaged 24,873, ranging from a low of 12,455 in September 2007 to a high of 37,771 in 2003, based on DataQuick’s statistics, which go back to 1988. Home foreclosures and loan modification plans dominated the housing transactions again this quarter even though REO sales were higher.

Foreclosure News, Housing Articles, Mortgage News, Subprime Mortgage News

Saving Your Home with a Loan Modification

August 28th, 2009

Home foreclosure rates and loan delinquencies continues to break records each quarter in the United States. The housing recession and home equity slide has not hit the bottom yet in many regions of the country. Mortgage relief is available to most struggling borrowers, so if you were turned down recently for mortgage refinancing from your lender, it does not mean you won’t be approved for a loan modification plan.

Getting a loan modification is something that many Americans are looking to do to help save their home and avoid foreclosure. Over the last few years, many homeowners have seen their income decline which has made making a home loan payment very difficult. Unfortunately, some homeowners have even given up and just walked away from their mortgage letting their home go into foreclosure.

If you decide to let your home go into foreclosure, it will take you many years to recover financially. You will be able to buy nothing on credit for an entire decade which is a lot longer than it seems. Once you do get this taken off your financial history, it is still going to be very difficult to get a low interest rate on most loans that you apply for. We suggest exploring all options available to avoid foreclosure. In most cases, it would be more advantageous to default on all your unsecured loans and credit cards than to go into default on your home mortgage which ends in foreclosure and loss of your home.

Foreclosure News, Housing Articles, Mortgage News

Thrift Originations Drop

August 28th, 2009

The Office of Thrift Supervision reported that thrifts originated $62.4 billion in real estate financing during the 2nd quarter.  Mortgage loan production dropped from the first quarter’s $88.1 billion and tumbled from $107.5 billion in the 2nd quarter 2008. Most lenders have become more cautious as loan modification agreements and home foreclosures continue to rise.  Read the original article online at >Thrift Loan Originations Down

Foreclosure News, Subprime Mortgage News

HUD Suspends FHA Lenders

August 28th, 2009

Three FHA approved lenders approved to offer FHA mortgages insured by the Federal Housing Administration were suspended by the U.S. Department of Housing and Urban Development over “serious” violations. HUD announced their Mortgagee Review Board had suspended Golden First Mortgage Corp. The Great Neck, N.Y., company allegedly neglected to notify HUD of an Office of Thrift Supervision investigation into the activities of its president or his involvement in an OTS civil money penalty. Suspended lenders are not allowed to sell new FHA-insured loans while HUD investigates their FHA lending practices, the statement said.

FHA mortgage rates remain low and the Federal Reserve has ensured FHA lenders and banks offering HUD loans his commitment to making affordable home financing available to Americans. When shopping for a FHA lender, Lenders Nationwide recommends that consumers consider FHA mortgage companies that have a clean HUD record. Read the original Lenders Nationwide article online> 3 FHA Lenders Suspended

Mortgage News, Subprime Mortgage News

Housing Crisis Disappearing

April 6th, 2009

Home Sales in February are beginning to increase with foreclosure defaults supplying much of the housing inventory.  With mortgage interest rates below 5% on thirty-year fixed rate home loans have caused a spike in FHA mortgage lending and home buying for first time homebuyers.

 

Watch Housing Crisis Rebound Video

 

Despite an ongoing recession, dropping home sales and a foreclosure crisis, there are some indications that the housing market may be heading for a recovery. CBS News’ Priya David reports on some positive movement in Portland, Oregon that may reveal signs that the housing crisis could be disappearing.  Some realtors and lenders believe that we are seeing the bottom of the housing slump and that the real estate market in many areas around the country will see a rebound later this year and in 2010.

Foreclosure News, Housing Articles, Mortgage News, Washington News , , , ,

Home Foreclosure Crisis Continues

March 12th, 2009

More home financing debates have emerged as to whether President Obama’s mortgage relief plan will to stop the millions of homes now in danger of foreclosure in the near future. Consider the many underwater refinance mortgage programs over the last few years like, the FHASecure, Hope for Homeowners and the Home Affordable Refinance. For the most part each one of these programs has stopped short of solving the mortgage crisis. Most of the lenders in the country were simply not able to carry the risk that our government was because of increasing loan defaults nationally. Anthony Mason reports on whom Obama’s housing plan will risk the mortgage banking system.

Foreclosure News, Housing Articles, Mortgage News

Countrywide Mortgage and Subprime Loans

January 16th, 2009

Not too long ago, Countrywide was being investigated for mortgage security fraud.

The New York Times, which also cited anonymous sources, said the Justice Department is also involved in the Countrywide investigation. “We are not aware of any such investigation,” Countrywide spokeswoman Susan Martin told the Times.  BofA and Countrywide have been very aggressive with loan modification plans, so it looks like in the end Countrywide is trying to get it right. In recent years, bank and lenders are less likely to offer subprime home loans to a borrower that is struggling with affordability.

The Wall Street Journal first reported that the mortgage superpower was the subject of an inquiry, citing law enforcement officials and finance executives with knowledge of the development. FBI spokesman Special Agent Richard Kolko would not confirm if Countrywide is under investigation but said there is an open investigation. “The FBI has been investigating potential fraud in the subprime lending industry, however, we cannot confirm or deny which companies are under investigation, “Kolko said.

Foreclosure News, Housing Articles, Mortgage News , ,

Hank Paulson The Worst is Just Beginning for Housing Markets

January 16th, 2009

A year ago, Treasury Secretary Henry Paulson predicted the fallout from the subprime mortgage crisis was “largely contained.” The reports indicate that housing markets across the nation continue to decline.

Most homeowners and people residing in the United States, would disagree with Treasury Secretary Paulson. The foreclosure rates rose 81% in 2008 and so far in 2009 the foreclosure crisis looks to be a major issue facing President Barrack Obamma.

Foreclosure News, Housing Articles, Mortgage News, Washington News , ,

Does Bush Hold Responsibility For the Housing & Mortgage Crisis?

January 12th, 2009

Jon Kyl and Chris Dodd talking about the mortgage crisis that evolved into a housing crisis.

Blitzer opens with: A lot of people, Senator Kyl in Arizona, in the housing market out there, they’re suffering big-time right now. How much of the blame, and I know you’re a blunt guy, how much of the blame does the Bush administration deserve for allowing this kind of situation to deteriorate, as it has? Does George Bush Have Any Responsibility For this Mortgage Crisis.

KYL: Virtually none.

BLITZER: Why?

KYL: We’ve been predicting for years that this problem would come along. When I was chairman of the Republican Policy Committee, we wrote papers on it. We provide people with the tools to compare mortgage refinance loans and it is not the Federal government’s job to micro-manage banks.

BLITZER: But isn’t the federal government responsible for making sure this kind of situation doesn’t happen?

KYL: The problem is, there is very little regulatory authority. That’s why this legislation that Senator Dodd has been working on, the one good feature of it is additional regulation. But we should have had that regulation four years ago. The other problem, here, is that much of the bailout here is for the people holding bad loans, not the homeowners. It’s for the speculators, the investors. I know in the oil crisis, everybody’s concerned about the speculators driving up the price. What do you think happened in the housing market?

BLITZER: Senator Dodd, go ahead and respond.

DODD: No, no, no. Very specifically, Jon, we absolutely seclude speculators from having any benefit all the under the act. That’s very clear in the law. Of course, this is a highly regulated industry, Jon. This isn’t like hedge funds. The mortgage market has been a highly regulated industry. Where were the cops? Why weren’t they out there saying when brokers were luring people in and saying I’m your financial adviser, a fully indexed price, don’t worry about it, lie about it if you want, we’ll get you into that home.

Those were people that had a responsibility, that failed in that responsibility, and the regulators watching them should have been doing a better job and they didn’t do it. That’s a major reason why we’re seeing the problems we’re seeing today.

KYL: Just one quick example. There’s much to be said. The provision that Chris alluded to that the Bush administration opposes and would veto the legislation over are these CDBG grants. They don’t help. Get the latest News on the Housing Crisis.

Foreclosure News, Housing Articles, Mortgage News

Fannie Mae OKs Renters to Stay After Foreclosures

December 23rd, 2008

In a recent article, Carol T. Powers analyzes the recent Fannie Mae move that enables relief to thousands of renters who face eviction but draws the federal government even deeper into the housing market. Fannie Mae said recently that it would sign new leases with renters living in foreclosed properties owned by the company. John Taylor, a consumer advocate, said banks should follow Fannie Mae’s example. “There are renters all around the country who have been holding up their end of the bargain and paying their rent faithfully, but the landlord got into trouble, and so the renter is now unfairly facing eviction,” said John Taylor, president of the National Community Reinvestment Coalition, a consumer advocacy group. “It’s really good news that Fannie Mae is doing this. Now the question is whether private sector will follow suit.”

In recent months, skyrocketing foreclosure rates have exposed as many as 70,000 renters to evictions, even though many never missed rent payments, according to analysts who track housing data. In many cities and states, renters can be evicted after their home goes into foreclosure, regardless of how long their lease stretches into the future. Since then Fannie and Freddie have come together with the “HARP mortgage” that allows their customer to refinance no matter how underwater their liens may be. The HARP 2.0 has already helped thousands of homeowners find a new mortgage with a lower fixed interest rate.

What are Fannie And Freddie Doing to Stem the Foreclosure Crisis

Many financial institutions including JPMorgan Chase and Bank of America have policies to evict renters after foreclosure, company representatives said. Fannie Mae’s initiative is expected to initially benefit as many as 4,000 renters living in foreclosed homes owned by the company. Fannie Mae has traditionally only bought and sold mortgages. But when a loan held by the company goes into foreclosure, Fannie Mae gains ownership of the underlying property until it is resold to new investors.

Fannie Mae owned 67,500 properties in foreclosure at the end of September, according to the company’s most recent filings. Most of those were owner-occupied. Under the new policy, former owners will most likely not be eligible to rent homes they lost in foreclosure.

It is the first national effort to provide significant relief to renters ensnared by the unfolding mortgage crisis, and it will effectively transform Fannie Mae — a government-controlled mortgage finance company into a national landlord. It may also increase pressure on private lenders to establish similar programs and on lawmakers to pass renter relief. Read the complete article at Bloomberg online.

Foreclosure News, Housing Articles ,

Federal Panel Considers Economic Issues for the Las Vegas Housing Crisis

December 18th, 2008

Nevada has quickly deteriorated from a boomtown to a place on the brink of economic disaster, and a federal bailout of financial institutions has done little to reverse the trend, a congressional panel was told. “Our economy has gone from the fastest growing in the nation to amongst the worst,” state banking commissioner George Burns testified Tuesday at a meeting of a panel charged with reviewing the use of the $700 billion Wall Street rescue fund. The meeting attracting banking and housing experts and politicians was the first outside Washington for the four-member panel. The recent financial reform bills have focused on making home loan lenders for accountable with increased responsibility. have It comes a week after the group released a report raising questions about the effectiveness of the Treasury Department’s bailout program and its lack of transparency.

The panel is composed of Democratic appointees Richard H. Neiman, superintendent of banks in New York, Elizabeth Warren of Harvard Law School and Damon Silvers, associate general counsel for the AFL-CIO; and Republican Rep. Jeb Hensarling of Texas. Sen. Judd Gregg, another Republican, had been in the group but left it last month, citing the heavy legislative workload facing the Senate. Only the Democratic appointees traveled to Las Vegas, at the urging of Sen. Harry Reid, D-Nev. Few places have been hit as hard by the credit squeeze and the foreclosure crisis. “We need to know how the Wall Street bailout looks from here. Has it worked?” Silvers asked. The answer from those in attendance was a solid no.

In her comments, Rep. Shelley Berkley, D-Nev., said “there is no discernible impact” in Nevada from the bailout money. A $250 billion capital injection program has not yet helped small, community banks that could be in a strong position to encourage lenders to lend more money, said Bill Uffelman, president of the Nevada Bankers Association. The program hasn’t decided on appropriate guidelines for eligibility for the funds. Uffelman said smaller institutions weren’t getting the assistance that was so quickly offered to the large financial institutions whose near-failure prompted the federal action. “It seems to be a matter of too big to fail versus too small to matter,” he said.

Gail Burks, the president of Nevada Fair Housing Center, said her nonprofit receives 600 calls a day from homeowners seeking to prevent foreclosure. She said a typical loan modification takes about 200 hours of staff time. Burks said mortgage modifications should be streamlined and made mandatory for lenders that accept federal aid money. Reid later told reporters he supported mandatory modifications. He also endorsed a 90-day moratorium on foreclosures to give homeowners “breathing room.”

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New Foreclosure Rights for Renters

December 10th, 2008

In a recent article written by Chris Reidy, he reveals a new home foreclosure brochure that outlines renters’ rights. The administration of Governor Deval L. Patrick said today that it has issued a brochure outlining the rights and responsibilities of Massachusetts renters living in foreclosed housing units. According to the Massachusetts Executive Office of Housing and Economic Development and the Office of Consumer Affairs and Business Regulation, the brochure “empowers renters with information to ensure that they understand the foreclosure process and are not unfairly evicted after the building they live in is foreclosed upon.” The days of sponsoring and encouraging no credit loans have disappeared. The administration noted that the Commonwealth’s Division of Banks estimates that 30% of the 7,653 Massachusetts home foreclosure sales in 2007 involved multi-family properties. Foreclosures have jumped as a result of the credit crisis and the slumping economy. Foreclosure news continues to headline newspapers across the country. Unfortunately, millions of Americans have lost their houses during the housing crisis. Hopefully the Dodd-Frank laws will do a better job to protect tax-payers against paying the bill for bad mortgages.

According to state law, a tenant is entitled to at least thirty days written notice if the owner wants them to vacate the property, and a tenant is then entitled to a court hearing if they wish to remain in their home after receiving the proper thirty days written notice, the Patrick administration said in a press release, which added that without court approval, owners do not have the right to evict their tenants. The State of Massachusetts continues to take an active role for home preservation as the are actively promoting foreclosure prevention methods with mortgage relief from mortgage loan modifications and loan work-outs.

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Commission Recommends Enforcing Fair Housing to Minimize Housing Crisis

December 9th, 2008

In a recent article written by Hope Yen, the discussion of Fair Housing, Fair Lending and Quick Reforming is examined. According to recent reports, President-elect Barack Obama is being urged to strengthen enforcement of fair housing laws to curb the sub-prime mortgage debacle and mitigate the housing crisis doesn’t disproportionately hit minorities and the poor. A bipartisan commission pointed Tuesday to waning prosecutions of fair housing complaints, particularly under the Bush administration. “The system doesn’t work,” former Housing and Urban Development secretary Henry Cisneros said at a news briefing on the 85-page report prepared by the commission, which was co-chaired by Cisneros and former HUD secretary Jack Kemp. Cisneros said stronger HUD enforcement is needed in the interim until a separate agency can be created, saying, “This is the only way to address serious problems of housing segregation and discrimination that led us to our current foreclosure crisis.” Ultimately, the panel said Congress and the Obama administration must create an independent agency that would be free of inherent conflicts of interest at HUD. As it stands, HUD is in the awkward position of suing sub-prime lenders it also depends on to administer housing programs.

In its six-month investigation, the commission said a discriminatory lack of lending by financial institutions in lower-income neighborhood communities opened the door for high-cost home loan lenders to set up shop, resulting in “steering” of subprime mortgage lending toward minorities and the poor that later forced them to default. The commission says more than 4 million cases of housing discrimination occur each year, yet fewer than 30,000 complaints are filed to HUD. Of those, the number of cases prosecuted have steadily declined from 88 in 2001 to 31 in 2007. In 1995, HUD prosecutions numbered 125 — higher than recent years but still a fraction of total complaints. HUD’s popular mortgage program, the FHA loans have always made great strides in bridging the gap for minorities to become homeowners.

HUD delays in investigating fair housing complaints also have grown, currently averaging 502 days. Citing in part a “lack of leadership” in the last eight years, Cisneros, who served under President Bill Clinton, said Obama’s transition team had responded “very positively” to the commission’s findings and recommendations. Obama earlier this week expressed impatience with Bush’s response to the mortgage foreclosure crisis. “I expect an open hearing from the top people in the administration when they’re named, including the HUD secretary and the president-elect,” Cisneros said. Kemp, a Republican who served under President George H.W. Bush, said in a statement that the federal government needs to return to the business of “getting things done.” He did not appear at the news briefing, citing health difficulties.

More Fair Housing Recommendations:

o Revive the President’s Fair Housing Council, which has met only once in recent years, to promote coordination of housing enforcement with HUD, the Justice Department, bank regulatory agencies and housing groups.

o Create a five-year HUD multimedia program aimed at educating people about their fair housing rights.

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