Posts Tagged ‘Lenders’
$656.8 million to help struggling homeowners on hold
Florida has $656.8 million to help struggling homeowners, but distribution of the federal aid is likely on hold statewide until early 2011. The money, awarded through the Obama administration’s “Hardest Hit” program will pay the mortgage of unemployed or underemployed borrowers for up to 18 months as they seek new jobs or training. Originally announced in February, Florida got another infusion of hardest hit money last week that will increase those helped from 12,000 to 20,000. The Florida Housing Finance Corporation is now working to amend its plan for the money and hopes to submit it to the Treasury Department for approval by Sept. 1. The original plan had relied on lenders to waive or delay nine months of mortgage payments if a homeowner received nine payments from Florida’s hardest hit money. On Thursday, Florida housing officials said they could not get lenders to sign on for the state program. A federal plan that requires banks to forgive, temporarily or permanently, 90 days worth of mortgage payments for unemployed homeowners who seek a loan modification was announced after Florida had developed its plan. Banks didn’t want to agree to both mortgage forgiveness plans. “With that intervening federal program, we were unable to get the match from the lenders we were looking for,” said David Westcott, director of homeownership programs for the Florida Housing Finance Corporation. Florida’s new plan will pay up to the full 18 months for eligible borrowers, but the delay to get approval means a required 90-day trial program is also being pushed back. That trial, expected to begin this fall, will be held in Lee County, with only Lee County residents eligible. Despite the holdups, Westcott said the state is happy to have the money. “This means more money to help more people for a longer period of time,” he said. For information on the hardest hit fund, go to www.floridahousing.org. Copyright © 2010 The Palm Beach Post, Fla., Kimberly Miller. Distributed by McClatchy-Tribune Information Services.
Average mortgage rates hit low of 4.42%
Mortgage rates fell to the lowest level in decades for the eighth time in nine weeks, a sign that investors are concerned about the weak economy. The average rate for 30-year fixed loans this week was 4.42 percent, down from 4.44 percent last week, mortgage buyer Freddie Mac said Thursday. That’s the lowest since Freddie Mac began tracking rates in 1971. The average rate on 15-year fixed loans dropped to 3.9 percent, down from 3.92 percent last week and the lowest on records dating back to 1991. Rates have fallen since spring as investors sought the safety of Treasury bonds, lowering their yield. Mortgage rates tend to track those yields. Falling rates have pushed refinancing of home loans to the highest level since May 2009. But it’s still lower than during the first three months of that year, when rates first fell to around 5 percent. Low mortgage rates, however, have failed to spark home sales. They remain hobbled by the weak economy and tight credit standards. Rates have fallen since spring as investors sought the safety of Treasury bonds, lowering their yield. Mortgage rates tend to track those yields. To calculate the national average, Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day. Average rates on five-year adjustable-rate mortgages were unchanged at 3.56 percent. Rates on one-year adjustable-rate mortgages also were unchanged at an average of 3.53 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 0.7 a point for 30-year and 1-year mortgages. They averaged 0.6 of a point for 15-year and 5-year mortgages. Copyright © 2010 The Associated Press, Alan Zibel, AP real estate writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Fed: Give borrowers time to change their minds
The Federal Reserve released a proposal Monday to give mortgage applicants three days to change their minds. The proposal was part of a 930-page document that clarifies and finalizes the new financial reform law. The Fed’s document says that for closed-end loans secured by real property or a dwelling, a creditor must: • Refund any appraisal or other fees paid by the consumer (other than a credit report fee) if the consumer decides not to proceed with a closed-end mortgage transaction within three business days of receiving the early disclosures (fees imposed after this three-day period would not be refundable). • Disclose the right to a refund of fees to consumers before they apply for a closed-end mortgage loan. The Fed says this proposal will make it easier and cheaper for consumers to comparison shop. It also acknowledged that borrowers who want to close a transaction in a hurry would be handicapped because most lenders will delay sending out an appraiser for a few days. Other proposals affecting homebuyers included: • A ban on yield-spread premiums, which encourage mortgage brokers to push buyers toward more profitable mortgages. • A requirement for lenders to tell borrowers when their mortgage is sold or transferred. • An explanation of the effects of balloon payments, adjustable loan payment fluctuations and minimum payments on loan balances. Source: Bankrate.com, Holden Lewis
Homes lost to foreclosure up 6% from last year
The number of U.S. homes lost to foreclosure surged in July, another sign lenders are moving quicker to take back properties from homeowners behind in payments. Lenders repossessed 92,858 properties last month, up 9 percent from June and an increase of 6 percent from July 2009, foreclosure listing firm RealtyTrac Inc. said Thursday. Banks have stepped up repossessions this year to clear out the backlog of bad loans. July makes the eighth month in a row that the pace of homes lost to foreclosure has increased on an annual basis. Meanwhile, homeowners who are falling behind on their payments are being allowed to stay in their homes longer because lenders are reluctant to add to the glut of foreclosed homes on the market. The number of properties receiving an initial default notice – the first step in the foreclosure process – rose 1 percent last month from June, but tumbled 28 percent versus July last year, RealtyTrac said. Initial defaults have fallen on an annual basis the past six months. The latest data reflect a foreclosure crisis that continues to drag on as many homeowners struggle to make their monthly payments amid high unemployment, slow job growth and an uneven rebound in home prices. Economic woes, such as unemployment or reduced income, are now the main catalysts for foreclosures. Initially, lax lending standards were the culprit, but homeowners with good credit who took out conventional, fixed-rate loans are now the fastest growing group of foreclosures. Lenders are offering a variety of programs to help homeowners modify their loans, but their success rates vary. Hundreds of thousands of homeowners can’t qualify or fall back into default. The Obama administration has rolled out numerous attempts to tackle the foreclosure crisis but has made only a small dent in the problem. More than 40 percent, or about 530,000 homeowners, have fallen out of the administration’s main effort to assist those facing foreclosure. That program, known as Making Home Affordable, has provided permanent help to about 390,000 homeowners, or 30 percent of the 1.3 million who have enrolled since March 2009. Still, RealtyTrac estimates more than 1 million American households are likely to lose their homes to foreclosure this year. In all, 325,229 properties received a foreclosure-related warning in July, up 4 percent from June, but down 10 percent from the same month last year, RealtyTrac said. That translates to one in 397 U.S. homes. 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. Among states, Nevada posted the highest foreclosure rate in July, with one in every 82 households receiving a foreclosure notice. The number of properties in Nevada receiving a foreclosure warning last month rose nearly 7 percent from June, but fell nearly 30 percent from the same month last year. Rounding out the top 10 states with the highest foreclosure rate last month were: Arizona, Florida, California, Idaho, Michigan, Utah, Illinois, Georgia and Maryland. Las Vegas continued to be the city with the highest foreclosure rate in the U.S., with one in every 71 homes receiving a foreclosure notice in July – more than five times the national average. Copyright © 2010 The Associated Press, Alex Veiga, AP real estate writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. Related Topics: Foreclosures
CoreLogic releases 2010 Short Sale Research Study
CoreLogic, a provider of consumer, financial and property information and business services, released its 2010 Short Sale Research Study. According to the study, lenders should continue to view short sales with a skeptical eye. CoreLogic says the estimated financial impact of short sale fraud is $310 million annually, with the risk of “unnecessary losses” occurring in one in every 53 short sale transactions. The average amount of unnecessary loss is $41,000 per short sale transaction. The results are derived from a representative data sample of single-family residence (SFR) short sale transactions from the past two years. CoreLogic says the transaction data used for the study represents 98 percent of real estate transactions and 85 percent of mortgage financing details. The study can be downloaded (registration required) at: http://www.corelogic.com/shortsalestudy. “A jobless economic recovery and weak home prices are fueling short sales volume,” says Craig Focardi, senior research director of consumer lending at The TowerGroup. “In many instances, government-sponsored or private short sale programs are a preferable alternative to foreclosure. However, important aspects of the short sale transaction are disclosure of all potential buyers to the seller and accurate home price comparables.” “By definition, short sales constitute a financial loss to lenders but will continue to be a necessary part of the mortgage industry as it seeks stabilization,” says Tim Grace, senior vice president of Fraud Analytics, CoreLogic. “The primary objective for lenders is to eliminate unnecessary loss CoreLogic 2010 Short Sale Research study highlights • The number of short sales in the market has more than tripled since 2008, with the estimated annual volume at 400,000. Multiple variables indicate short sales will continue to be a frequent and important part of the mortgage industry. • Over half (55.8 percent) of all short sales occur in four states (California, Florida, Texas and Arizona). • Approximately 4 percent of short sales have a subsequent resale within 18 months. • Investor-driven short sales are not inherently bad. Investors provide the industry with necessary liquidity.
Buying Pre-Foreclosures Or Short Sales
Pre-foreclosures are properties that are just a step away from being repossessed or retrieved by the institution that lent the money to enable people to buy them in the first place. At this stage, you still own the property completely. However, if you don't settle pending payments, the financial institution (lender) will take the real estate from you. If you do settle any outstanding payments at this time, you avoid foreclosure. The Benefits of Pre-Foreclosure Properties If you are a buyer then it would interest you to know that buying property at the 'pre foreclosure' state can be profitable. However, even though short sales are one of the best ways to buy a home many miss the boat, so to speak. This is because not many know the pre foreclosure state and just how beneficial it can be. As you can imagine, pre foreclosure properties have a nice or better price tags on them. It is not surprising at all to find real estate at HALF their present market value. Due to the fact that the owner of the property is in desperate need for cash, he or she will likely receive any offer a potential buyer will put forth. To be a bit blunt, what's the alternative for him? If he doesn't accept the offer for his property, he will end up losing everything. In the end, it's better to at least get something for it, right? As such, engaging in short sales can be very beneficial for you. Another benefit to buying real estate in pre foreclosure is that you get to transact with the property owner directly. No agents or brokers need be involved, making it easier to purchase the property. So how do you find pre foreclosure property? The process is pretty much looking at foreclosed property listed by banks and other lenders. All you need to do is check your local paper, online or even contact certain lenders in your area directly. Once you find your dream home presented as a short sale, grab the opportunity! It's very rare to find great homes at great prices so do your research well. Now you may ask, why not just look at foreclosed properties? Why not just wait for the listings rather than actively seek them? This is why: there are LESS people hunting or looking at pre foreclosures. This means you get a better chance at the property of your dreams because there are less people wanting to purchase the same real estate. So if you are looking for a new home or want to invest in property, look at pre foreclosures. You just might find exactly what you need. Don Cramer has been selling real estate in the North Port, Port Charlotte Florida and surrounding areas for over 10 years. Visit our website at: http://www.bestchoicerealty.net/. Are you looking for more info to help you with buying your home? Just go to: Buying A Home Article Source: http://EzineArticles.com/?expert=Don_Cramer
Which Distressed Home For Sale is For You?
In the world of foreclosure investing, you have to realize as early as possible that success lies with your property choice. Remember that there are actually different kinds of distressed homes for sale and you should be aware of the advantages and disadvantages of each type. Basically, there are: Pre Foreclosures - these distressed properties are the hardest to find but the easiest to buy. Advantages of choosing these homes include faster transaction since you will be dealing with the seller directly; home is in a much better shape since the owner is still living there, easier to negotiate since the owner is under time pressure to avoid foreclosure and cheaper since there are no foreclosure cost that will weigh you down. The only downside is that you might get too excited and neglect to check the property's condition as well as the title. You can expect the owner not to disclose everything so it would be up to you to discover hidden problems with the property by hiring a professional home inspector. Short Sale - owners who are exploring a short sale is also a pleasure to talk to since they are also desperate to stop foreclosure and save their credit. In a short sale, you can make an offer that is close to what the property is currently worth in the market. The key, obviously, is to find homes whose values have declined considerably. Unfortunately, your offer should be accepted by the lender or else, the short sale cannot proceed. Foreclosures at Auctions - looking for distressed homes for sale will be easiest if you attend foreclosure sales. All you need to do is place a bid and you can go home with one of these foreclosed properties. Of course, you have to consider that there are certain requirements that you need to fulfill if you want to participate. Some auctions require you to pay cash so you should be ready to do so. REOs - distressed houses that survived foreclosure auctions are reverted to their lenders. As their inventory grows, banks offer more discounts and incentives. For them, selling these properties at half their market values is better than keeping them. So as a last resort, you can find distressed homes for sale this way. You can also be sure that all secondary liens will be cleared from the property. Actually, it does not matter which repo property you choose since any one of these homes can offer savings and instant equity. But with the millions of distressed homes for sale in the market today, finding one that will be able to meet all your preferences as well as budget will be a daunting task. Experts recommend that you use foreclosure listings. These listings are actually search tools that will make everything convenient for you. You can search home by location or list price. Also, some providers even offer tips and helpful information as part of their service. You can subscribe to an online listing and there will be no need for you to leave your home. All you need to do is to point and click. Joseph B. Smith has been educating buyers on the finer points of Distressed Homes for Sale at DistressedPropertiesSale.com for over five years. Contact Joseph B. Smith through DistressedPropertiesSale.com if you need help finding information about Distressed Homes for Sale. Article Source: http://EzineArticles.com/?expert=Joseph_B._Smith
Submit Winning Offers For Bank Foreclosed Houses
Buying bank foreclosed houses involve the use of the right strategies and proper planning. The amount of work that goes in foreclosure investing such as conducting research, hiring professionals, and inspecting homes should at least be compensated by a reasonable success ratio. This is extremely important since buying bank owned houses requires a rigid, often inflexible process to which you should comply. This only means that your chances of success depend highly on how your offer is going to be perceived by bank officials who most certainly would be very careful in evaluating your bid. A well-thought out plan will certainly increase your chances of hitting success when it comes to bidding for REO properties. This is because banks are judicious when it comes to awarding properties to the right bidder which they need to do in order to maintain their reputation of being capable of sound lending decisions. In addition, employing good strategies will not only minimize frustrations but will also save you precious time and thousands of dollars. Get Preapproved One of the most important things that banks and lenders look for in a bid is the financial standing of the bidder. Getting a preapproval means that you have been preapproved for a specific price range of properties. This sends a signal to the bank that you are serious about buying the property since you have exposed yourself to the whole process of submitting financial data and records to a loans officer to secure a preapproval. And serious buyers are what banks actually look for. Because of their extensive experience in foreclosures and bankruptcy, they are aware that persons with good credit history backed by strong financial state are more trustworthy when it comes to repaying loans. Once you have been preapproved, make sure that you attach your preapproval letter to your bid. This will ensure that the bank will take notice of this fact and can even get them to prioritize your application over others who have been unable to get preapproved. Since the foreclosures market is a tough one, getting an edge in your application can earn points for you over your competitors. Bid Competitively Getting a good bargain is every investor's goal. But when buying bank foreclosed houses, being unreasonably cheap in your offer can turn off a loans officer who will determine whether your application deserves a review or not. On the other hand, a competitive bid will definitely attract the bank's attention to regard your offer seriously. Bidding competitively involves careful research and scrutiny of the market. Usually, when you have found a property or properties that you are deeply interested in, you may then proceed to researching and comparing its listing price to its current market value, the unpaid mortgages, and outstanding debts attached to it. This will give you an idea of the price within which to negotiate with the bank. Bear in mind that the bank sells a property in order to recover its losses. This means that they will not be accommodating to bids that are way below its target recovery value. Be Responsive To The Bank Dealing with a bank means dealing with a whole financial institution. After you have submitted your offer to the bank's assets manager or REO department for a particular property that you want to buy, you should maintain communication with the bank. This is very important since it is highly possible that your bid is only one among the many offers that a property receives in a day. When the bank reviews your offer, it may need to reach you to clarify some terms and details in your bid and you should be able to address this as quickly as possible in order to avoid having your application at the bottom of the pile. If you follow these simple tips, you can be sure that your efforts at buying bank foreclosed houses will definitely be fruitful. Joseph B. Smith has been educating buyers on the finer points of Bank Foreclosed Houses at BankForeclosuresSale.com for over ten years. Contact Joseph B. Smith through BankForeclosuresSale.com if you need help finding information about Bank Foreclosed Houses. Article Source: http://EzineArticles.com/?expert=Joseph_B._Smith
Great Tips to Make a Great Commercial Foreclosure Purchase
The commercial real estate market is terrible. There are signs that office vacancy is leveling off. Occupancy has stabilized in multifamily. So, the economics of owning these projects is stabilizing. Unfortunately, many owners remain over leveraged and the bad news is about to get worse for them as the markets pick up steam and the economy improves rates are about to begin heading the wrong way. This could not come at a worse time as these owners are going to face loans that can't meet Loan to Value (LTV) ratios suddenly collapse on the basis of Debt Service Coverage (DSCR) as well. Lenders are going to be forced to write these loans down and foreclose to establish credible financing on the assets. For buyers, the good news is these conditions may persist for 36 to 48 months. So, if you are a buyer who can bring substantial equity capital or all equity to deals, the opportunity to buy properties at sharply depressed values and to lock it very solid cash on cash returns has never been greater and the condition will improve for you even further in the coming months and years. Principals and investors should be gathering resources for acquisitions now. The greatest opportunities may well be some of the best assets as the trigger for defaults is being driven by very strong underwriting characteristics that created values that today's commercial market will not support. The best locations, the highest trafficed roads, the best sources of employment, the best shopping, and the very best facilities combined with properties that provide the greatest possible average occupancy letter may in fact represent some of the most at risk assets. Investors bringing plans with conservative loan to values, captive debt or 100% equity purchase plans, proven management, and bank accounts that say "low risk" to bankers are going to be the preferred purchasers. Investors without a great deal of experience or with no experience should seek to attach their funds to proven players where they can substitute those credentials for their own lack. On the other hand, if you are an investor who is in this position. Your best bet is to cut a deal with outside investors to improve your underwriting ratios. Put in significant cash reserves. Reduce your LTV position. Improve your DSCR position. And, position to move ahead as a leader in this environment and avoid becoming a casualty. Take the lessons learned and become the experienced buyer. Blake Ratcliff (US Naval Academy Graduate & Marine Officer, Serial startup entrepreneur, COO/CEO, multifamily / residential investment founder, and property manager). Blake's crafted 100+ business plans, prepared and delivered 1000+ investor presentations, and is an expert financial modeler. A deeply experienced real estate business person and startup business expert, Blake hones your Business plans, reports, and presentations.
