Pidgins continued…
By Capt. Krusty | February 17, 2010
As the the little girl said…”we’re back!”…so let’s jump right into the story.
So far we’ve seen 308 mortgage sources collapse since 2006 (according to implode_X.com), both Banks and Mortgage Bankers, housing price took a dive, millions have defaulted on their mortgages, millions have tried “loan modifications” and failed, millions have tried (or are trying) to short sale…yet our inventory of sellable foreclosed home are way down , with just trickles coming from the asset managers….so where are they? For just over a year, we have seen moratorium after moratorium sanctioned by the Feds , backing off the release of assets held. The reasoning?…stop the declining prices and stablize the market. A bi-product of this is the fact that Banks are actually learning how to deal with true modifications…AND (the big one!)…how to do short sales. In our opinion, we think that Banks, and Servicers are coming to the realization ,that just maybe…a Short sale is more rewarding (financially) then a foreclosure…no more emotional revenge…you know… “you got my money…now I’m going take your home to get even”, In spite of the positive changes, the “Buble” is still lurking out there (That right.. remember the “Bubble”? it never popped, or deflated, in fact it’s bigger then the Goodyear Blimp by now….and it’s coming!) According to the Local rag (Mercury News on 2 17/2010), there’s approximately 4,800 foreclosed homes in our little portion of the state that are being held for “release” (and we are one of the least devastated areas in the nation!)…….so when are they coming?
next time……
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“Some days your the pidgon, and some days your the statue”
By Capt. Krusty | February 17, 2010
WOW, we took a year off (last post, 1 year minus 2 days). During that time we were busy… trying to stay busy…Survival… we were looking for new “income steams”, and adjusting to market and regualtion changes. Our team tossed 50 balls into the air to see which ones would stay up., and the fall-out has been a real eye-opener.
It been BPO’s (Broker Price Opinion), REO’s (Real Estate Owned-foreclosures),loan Modifications, Short Sales, floating mortgage limit parameters, moritoriums, HVCC (Home Valuation Code of Conduct- appraisals), and the GFE (Federal Good Faith
Estimate) debacle.
Just crossing over into 2010… and our state (California) tosses the Mortgage Broker into the arena and turns their back on us (SB 36-requiring a Federal endorcement for all individuals with a DRE lic. that orginate mortgages).Of course, Banks (who don’t require any licensing) and CFL holders are exempt from the Federal tag. So in addition to maintaining a DRE lic. the “Mortgage Originator” has to have, E&O insurance, the cost of the Fed.background check, finger printing , a credit report (yup,that’s right- you need to have good credit…in able to write loans, according to the Fed’s), the actual cost of the Federal endorcement….AND if your Broker of record is a member of a Real Estate Board, you also have to maintain board membership (2009 law!). With that annual financial load, you need Bail-out funds just to get the pilot lit!
So, maybe I don’t want to concentrate on loans this year…….. but , that’s not the end of the story…let take a look at the actual Real Estate market…oh, by the way….where did all those foreclosures go???
…next time
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The Calvary is coming!
By Mr. B | March 19, 2009
Not that I’m suspicious or anything…but around Friday the 13th I start feeling a little funky…Well this started on Friday the 13th in 2006 with a feeling of “impending doom” and continued in a downward spiral. Things actually started getting worse, and have continued doing so. It been a hard pull being a small business owner, especially if your an owner/broker of a Real Estate related business. So every year since, when I see that day on the calander I wonder what direction my “Joss” will go.
Last Friday was the first “Friday the 13th” of 2009. It came…it went and no major disasters. This week good stuff started happening. The bond market had a 50 point spread in our favor which has not happened in four decades, The Big Cheese, Mr. “O” jumped in with 3 trillion (yes…that’s with a “T”) dollars to shore up Fannie/Freddie and instill some confidence in the “bulls and the bears” down there on Wall St. He also scared the stuffing out of a lot of the banking administration types with “hard rules” and accountability for bail-out money..(guess they are not use to telling people where the money evaporates too).
A lot of people are buying homes that never could before. The sun is shinning, birds are signing, flowers are blooming, spring is just a week away ,my doors are still open… and I am setting here watching the intrest rate drop like a fat skydiver with no parachute. Life ain’t all that bad.
Capt. Crusty
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What Would Wake up The Housing Market?
By Andy | January 31, 2009
It’s not a big secrete. The fed has been stimulating the economy for years. If what they are doing is not working right now we need to try something else. The banks have screw up so badly we have to bail them out. If they are getting billions of dollars handed to them by our government and paid for by Joe tax payer. Why isn’t our government requiring a detailed account of where the money is being spent and why isn’t it being spent where it will stimulate the economy? There has to be relief for the tax payers to get the economy moving.
Why don’t we require a 3.5% interest rate max on all new home loans and new credit charges for a 3 year period. People will refinance and consolidate debt. People will start buying homes because more people will qualify. Have stated income loans but restrict the loan to value. If a person has saved $80,000 (20% of $400,000 sales price) to use as a down payment they are vested in their home and are less likely to walk from a property if the value decreases. At the end of the three year period everyone including the banks should be in a much better financial position.
Oh and one more thing. If a company is not run well its CEO should be fired not given a bonus. As a tax payer I am tired of bailing out companies.
Topics: Real Estate | 4 Comments »
“Look’n for Love in all the wrong places Part #1″
By Capt. Krusty | May 15, 2008
With all the press and hype on the market tanking…and the foreclosures…and the short sales, everyone’s looking for the perfect bargin.
Some how in all the media confusion, word has gotten out that “Short sale” will get you your dream home at a really great price…but after eleven months of watching every conceivable bidding tactic imaginable , I’ve come to the conclusion that winning in a short sale is pure “roll of the dice” luck for the buyer.
Smart money is on the foreclousure! WHY?
Let’s look at the psychology of Short sale vs Foreclousure from the banks point of view. 1.) In anticipating a short sale, the bank has not lost anything YET , and wants to lose as little as possible. 2.) No employee of the bank wants to be the one to make the decision to lose that asset. 3.) It’s easier to say “No” then to say “Yes”. Those who say “no” are not wrong….just cautious. Those who say “Yes” are exposed, and if something goes wrong…may be the subject of blame.No one wants to be wrong on the corpoate ladder,therefore getting a quick decision from a bank is unlikley. Another little twist is …somewhere in the bank is a room full of people that have only one mission in life…try and extract as much of the mortgage payments out of the the short sale client as possible AND try to talk you into keeping the property. YES they will contact you directly and try to get you to keep paying…anything, any amount…and their good at it.
On the foreclosure…decision has been made, the money has been lost…now you’ve got a depleated asset to deal with. At first, the holder of the asset will try to recapture as much money as possible by setting the price as close to fair market as fits the condition of the asset. As time goes on, they loosen their grip a little (realizing “time-is-also-money”), so lets get this sucker off the books! This is what’s called the “sweet spot” and usually occures around 60-90 days into the listing(our area), however this really varies with where you live and average D.O.M. for your MLS. When the chemistry is correct, and the planets are aligned…the decision will come quick.
Next time : Getting the bank to look at your offer .
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Economic stimulus package, has it helped?
By Mr. B | March 28, 2008
I read a great article about the new conforming loan limits today in the san Jose Mercury news. It echos everything I have been seeing from the lenders. I was hoping that the economic stimulus package was going to have a larger impact that it has. My phone has been ringing off the hook lately from people needing to get a debt consolidation loan. Many have a jumbo first loan and a small second they they want to combine and get a fixed rate payment on. With the values dropping in Santa Clara County, almost every one of them wants to convert their short term ARM to a 30 yr fixed rate with an affordable payment. With the current jumbo 30 year fixed rates being as ugly as they are, it doesn’t make sense for them to do it. With the new conforming limits these loans should be possible at much lower rates. The guidelines for the new loans are so strict, the impact we were hoping for may never happen. I can understand lenders being conservative on the loans they underwrite, but please…. Let’s bring back some common sense underwriting and let the qualified borrowers take advantage of the ecomomic package as it was intended.
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Interested in REO Properties?
By Andy | February 14, 2008
We have them go to www.MeridianCreek.com and click foreclosures. We have them in San Jose and the surrounding areas.
We have new REO’s coming to our website almost everyday so check back often.
If you are interested in working with our REO department contact me and we will make sure you are fully informed about our REO department opportunities, properties and properties that will be available shortly.
Andy Russo
Realtor/G.R.I.
Associate Broker
Senior Financing Consultant
Direct (408) 694-6805
Cell (408) 221-2397
Fax (866) 618-3886
Email Andy@MeridianCreek.com
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He signed it ! A step in the right direction.
By Andy | February 14, 2008
President Bush today signed off on the $168 billion stimulus package approved by Congress last week, which, in addition to tax rebates for millions of working Americans and business owners, includes a vital, but temporary increase in the conforming loan limit. The economic stimulus package will allow the Federal Housing Administration, as well as Fannie Mae and Freddie Mac to offer mortgages above the current conforming loan limit of $417,000 to as much as $729,750 in high-cost areas for loans originated between July 1, 2007 and Dec. 31, 2008.
“The actions of Congress and our president represent a significant victory for homeowners across the state and nationwide,” said C.A.R. President William E. Brown. “C.A.R. has long fought for increases to the conforming loan limit in order to close the gap for would-be home buyers in high-cost areas, such as California, and, with the spotlight now fully shining on this important issue, will continue those efforts and push for permanent changes beyond Dec. 31.”
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Feds Announce Plan To Delay Foreclosures
By Andy | February 12, 2008
WASHINGTON - Homeowners threatened with foreclosure would in some instances get a 30-day reprieve under an initiative the Bush administration announced Tuesday.
Dubbed “Project Lifeline,” the program will be available to people who have taken out all types of mortgages, not just the high-cost subprime loans that have been the focus of previous relief efforts.
The program was put together by six of the nation’s largest financial institutions, which service almost 50 percent of the nation’s mortgages.
These lenders say they will contact homeowners who are 90 or more days overdue on their monthly mortgage payments. The homeowners will be given the opportunity to put the foreclosure process on pause for 30 days while the lenders try to work out a way to make the mortgage more affordable to homeowners.
“Project Lifeline is a valuable response, literally a lifeline, for people on the brink of the final steps in foreclosure,” Housing and Urban Development Secretary Alphonso Jackson said at a joint news conference with Treasury Secretary Henry Paulson.
He said the goal was to provide a temporary pause in the foreclosure process “long enough to find a way out” by letting homeowners and lenders negotiate a more affordable mortgage.
Paulson said the new effort was just one of a number of approaches the administration was pursuing with the mortgage industry to deal with the country’s worst housing slump in more than two decades.
In December, President Bush announced a deal brokered with the mortgage industry that will freeze certain subprime loans — those offered to borrowers with weak credit histories — for five years if the borrowers cannot afford the higher monthly payments as those mortgages reset after being at lower introductory rates.
“As our economy works through this difficult period, we will look for additional opportunities to try to avoid preventable foreclosures,” Paulson said. “However, none of these efforts are a silver bullet that will undo the excesses of the past years, nor are they designed to bail out real estate speculators or those who committed fraud during the mortgage process.”
In coming days, lenders will begin sending letters to homeowners who might qualify for the new program. Homeowners won’t qualify if they have entered bankruptcy, if they already have a foreclosure date within 30 days, or if the home loan was taken out to cover an investment property or a vacation home.
The Mortgage Bankers Association reported that at least 1.3 million home mortgage loans were either seriously delinquent or in foreclosure at the end of the July-September quarter.
Private economists are forecasting that the number of foreclosures could soar to 1 million this year and next, about double the 2007 rate.
Officials did not have an estimate of how many people might be helped by the new “Project Lifeline” program.
Democratic critics said the administration was still not doing enough to help with a serious crisis that has slowed the overall economy to a near standstill and raised worries about a full-blown recession.
In a statement, Sen. Hillary Rodham Clinton, who is running for the Democratic presidential nomination, said that last year she had called for a 90-day moratorium on subprime foreclosures. She said the administration has been slow to react to the unfolding crisis.
“The administration’s latest initiative is welcome news, but more remains to be done,” she said in a statement.
Senate Banking Committee Chairman Christopher Dodd, D-Conn., said the finance industry and the administration were falling further and further behind in dealing with the growing crisis.
“This plan, while a step in the right direction, will not stem the tide of the millions of foreclosures we are facing in the coming months,” Dodd said in a statement. His committee will hold a hearing on the housing crisis on Thursday with testimony from Paulson and Federal Reserve Chairman Ben Bernanke.
The six participating banks are Bank of America Corp., Citigroup Inc. Countrywide Financial Corp., J.P. Morgan Chase and Co., Washington Mutual Inc. and Wells Fargo & Co.
They are all members of the Hope Now Alliance, an industry group that is trying to coordinate a response to the mortgage crisis. Officials urged homeowners to call the group’s toll free hot line number at 1-888-995-HOPE for assistance.
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NAR Says Economic Stimulus Legislation Will Help Jumpstart Sluggish Housing Market
By Andy | February 4, 2008
WASHINGTON, January 29, 2008 -
The National Association of Realtors congratulated the U.S. House of Representatives and President Bush for their bipartisan actions to help families in need, the housing market, and the U.S. economy.
“We believe the economic stimulus bill approved by the House today is a good legislation in that it can quickly be signed into law, quickly be implemented, and therefore, would quickly have an impact on families and the nation’s economy. We are pleased that both the Federal Housing Administration (FHA) and the Fannie Mae and Freddie Mac (GSE) loan limits have been increased, even if only temporarily,” said Richard Gaylord, NAR president.
NAR has been actively engaged in promoting an increase to the loan limits for FHA and the GSEs for many months. “Our research highlights that increasing FHA loan limits will help an additional 138,000 Americans achieve the dream of home ownership and will allow nearly 200,000 homeowners to refinance and potentially keep their home,” Gaylord said. “In addition, NAR believes that increasing the loan limits for Fannie Mae and Freddie Mac will bolster the housing finance market, which continues to be severely stressed, by providing an immediate infusion of much needed liquidity to the nation’s mortgage market. While such an increase will not solve the full range of housing challenges, it will play an important role in improving the nation’s economy,” said Gaylord
An economic impact study conducted by NAR earlier this month estimated that increasing the GSEs’ conforming loan limits would result in as many as 500,000 refinanced loans and could help reduce foreclosures by as much as 210,000. In addition, over 300,000 additional home sales could be generated. “These are real results and can have an immediate and sustainable impact for families across our country,” said Gaylord.
“We are also pleased that the House made the GSE limits retroactive to July 1, 2007. This too will provide greater liquidity to the market by allowing Fannie Mae and Freddie Mac to purchase more mortgages,” Gaylord said.
Additionally, NAR recognized the favorable tax treatment in the bill for certain commercial building improvements and noted the immediate positive impact this could have on cash flow.
While pleased with the quick action to pass the economic stimulus package, NAR urged Congress to complete broader FHA reform legislation. These reforms, including reducing down payment requirements and streamlining certain FHA processes, would make FHA more accessible to many more American families and further jumpstart the housing market. “We would also like to see the increase to the loan limits made permanent and we will continue to work with Congress and the administration to pass legislation that modernizes the FHA making it a more viable alternative, and permanently increases the loan limits for both FHA and the GSEs,” Gaylord said.
The National Association of Realtors, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.3 million members involved in all aspects of residential and commercial real estate industries. NAR is the leading advocate for homeownership, affordable housing and private property rights.
This information is provided by the National Association of Realtors
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