A few things to never do or do when trying to save your home from foreclosure:
***Never leave your home without fighting for your home, see the article below reference this subject.
***Never pay your mortgage earlier, if you do mortgage will never give you credit for paying your
mortgage ahead of time.
***Finally, never provide the mortgage company a copy of the original papers you sign when you purchased your home. Never, Never, Never and here is why they don’t have them. When you attend the foreclosure court hearing ask to be shown the original paper copy you signed when you purchased your home. Don’t allow them to show you a copy of a copy. If they don’t have the original papers you signed the foreclosure process must stop until they honor your request by showing the court the original papers with your signatures (s) on them. This is extremely important because they must have the original papers to prove to the court that they own your home. ****Beat them at their own game**** Find a good attorney if possible......
Foreclosures Take Twice As Long
To Process Now As They Did In 2007 Study
The Huffington Post Alexander
Eichler First Posted: 12/28/11 01:06 PM ET Updated:
12/28/11 01:13 PM ET
If
the American housing market is ever to recover -- and provide some momentum to
a broader economic turnaround -- it needs to work its way through the millions
of foreclosed properties that have yet to be processed and auctioned off. But
those cases are taking longer and longer to get through.
In
2007, the average foreclosure process in America, from beginning to end, took
253 days, or about eight months. Today, according to LPS Applied Analytics as
reported by CNN, the average foreclosure takes 674 days. That's a year and ten
months, almost triple what it was four years ago.
The foreclosure epidemic is one of the
main factors inflicting damage on the housing market, which has still not made
up for the losses it suffered a few years ago when the real estate bubble
burst. In neighborhoods across the country, foreclosed or vacant properties are
distorting their local markets, dragging down the values of the surrounding houses and
wiping out vast sums in homeowner wealth.
The
ubiquity of foreclosures, and their depressing effect on housing prices, has
been cited as both a symptom and a cause of the country's persistent
unemployment problem. Many homeowners enter default after losing their jobs --
and on the flip side, as the Wall Street Journal recently
noted, plummeting home values tend to trap people where they are,
making it harder for them to move to other towns where employment opportunities
might be more plentiful.
The
conundrum is expected to get worse in 2012. New foreclosures climbed by about 21 percent in the third quarter of 2011,
with a total of almost 1.33 million foreclosures underway by the end of
September. Analysts believe the volume of foreclosures will grow much greater next year as banks begin re-submitting
documents that had to be discounted in the wake of the robo-signing scandal,
when some of the country's biggest lenders were found to have approved reams of
mortgage paperwork without reading it first.
Thanks
to a government effort to screen out and correct instances of robo-signing,
more than four million homeowners will eventually get the chance to submit their foreclosure cases for review -- an ambitious
damage-control program that is nevertheless likely to prolong the real estate
market's lifeless condition.
Experts
have offered a range of predictions for when the market might touch bottom and
housing prices will begin to rise again. Even the most optimistic forecasts
don't see a recovery happening until late 2012 or early 2013.
Freddie Mac Bets Against American
Homeowners
by Jesse Eisinger, ProPublica and Chris
Arnold, NPR News Jan. 30, 2012, 5 am
Freddie
Mac, the taxpayer-owned mortgage giant, has placed multibillion-dollar bets
that pay off if homeowners stay trapped in expensive mortgages with interest
rates well above current rates. Freddie began increasing these bets
dramatically in late 2010, the same time that the company was making it harder
for homeowners to get out of such high-interest mortgages.
No
evidence has emerged that these decisions were coordinated. The company is a
key gatekeeper for home loans but says its traders are “walled off” from the
officials who have restricted homeowners from taking advantage of historically
low interest rates by imposing higher fees and new rules.
Freddie’s
charter calls for the company to make home loans more accessible. Its chief
executive, Charles Haldeman Jr., recently told Congress that his company is
“helping financially strapped families reduce their mortgage costs through
refinancing their mortgages.” But the trades, uncovered for the first time in
an investigation by ProPublica and NPR, give Freddie a powerful incentive to do
the opposite, highlighting a conflict of interest at the heart of the company.
In addition to being an instrument of government policy dedicated to making
home loans more accessible, Freddie also has giant investment portfolios and
could lose substantial amounts of money if too many borrowers refinance.
“We
were actually shocked they did this,” says Scott Simon, who as the head of the
giant bond fund PIMCO’s mortgage-backed securities team is one of the world’s
biggest mortgage bond traders. “It seemed so out of line with their mission.” The
trades “put them squarely against the homeowner,” he says. Those homeowners
have a lot at stake, too. Many of them could cut their interest payments by
thousands of dollars a year.
Freddie Mac, along with its cousin
Fannie Mae, was bailed out in 2008 and is now owned by taxpayers. The companies
play a pivotal role in the mortgage business because they insure most home
loans in the United States, making banks likelier to lend. The companies’ rules
determine whether homeowners can get loans and on what terms.
The
Federal Housing Finance Agency effectively serves as Freddie’s board of
directors and is ultimately responsible for Freddie’s decisions. It is run by
acting director Edward DeMarco, who cannot be fired by the president except in
extraordinary circumstances. Freddie and the FHFA repeatedly declined to
comment on the specific transactions.
Freddie’s
moves to limit refinancing affect not only individual homeowners but the entire
economy. An expansive refinancing program could help millions of homeowners,
some economists say. Such an effort would “help the economy and put tens of
billions of dollars back in consumers’ pockets, the equivalent of a very
long-term tax cut,” says real-estate economist Christopher Mayer of the
Columbia Business School. “It also is likely to reduce foreclosures and benefit
the U.S. government” because Freddie and Fannie, which guarantee most mortgages
in the country, would have lower losses over the long run.
Freddie
Mac’s trades, while perfectly legal, came during a period when the company was
supposed to be reducing its investment portfolio, according to the terms of its
government takeover agreement. But these trades escalate the risk of its
portfolio, because the securities Freddie has purchased are volatile and hard
to sell, mortgage securities experts say.
The
financial crisis in 2008 was made worse when Wall Street traders made bets
against their customers and the American public. Now, some see similar
behavior, only this time by traders at a government-owned company who are using
leverage, which increases the potential profits but also the risk of big
losses, and other Wall Street stratagems. “More than three years into the
government takeover, we have Freddie Mac pursuing highly levered, complicated
transactions seemingly with the purpose of trading against homeowners,” says
Mayer. “These are the kinds of things that got us into trouble in the first
place.”
Home Prices Plunging More In
Battleground States Than Nationally
Newt
Gingrich's alleged request for an open marriage and Mitt Romney's tax
returns took center stage at last night's Republican debate, but
perhaps the candidates should have been focusing on a different issue if they
want to win.
In
15 out of 16 states that are battleground areas for the election, home values have fallen an average of 16 percent since
October 2008, according to a report from the Progressive Policy Institute.
That's compared to an average drop of 11.8 percent for American homeowners
overall between 2007 and 2009.
And
if candidates don't come up with an adequate plan to address the housing
crisis, they could be facing voters' wrath. Romney was already assailed by critics in December for comments he made in
an interview with the Las Vegas Review-Journal suggesting that
the foreclosure process should be allowed to run its course.
"No
doubt, every contender for the White House will have a jobs plan,"
the the authors wrote in the PPI report. "But no economic
plan can be complete without an equally robust plan to rebuild housing -- and
in particular, to rebuild housing wealth."
Nearly four years after the housing
crash helped to pave the way for a financial crisis, home prices may still have
yet to bottom out. Home prices fell 2.5 percent in December from a year ago, according to the
National Association of Realtors. But the news isn't all bad. The supply of
U.S. homes on the market plunged to a level not seen since 2005.
That
could be because the glut of foreclosures on the market may be starting to
finally clear. Foreclosure filings dropped dramatically last year, according
to RealtyTrac. Though the drop points to recovery, it doesn't provide much
solace for homeowners that are still struggling.
Nearly 12 million Americans are underwater -- or living
in homes that are worth less than they owe on their mortgages, according to the
PPI report. In the 16 battleground states the report focused on, median home
prices plunged from an average of $167,231 in October 2008 to $27,913 in
November 2011.
In
Nevada, an important state for the election and the one of the hardest hit by
the foreclosure crisis, 91 percent of homes saw their values drop in the last
year. In Arizona,72 percent of homes dropped in value last year.
The
report offered some housing crisis fixes for the candidates to consider
adopting. In one approach called "shared appreciation mortgages,"
lenders would allow borrowers to lower their balance on their mortgage loan in
exchange for a share of any future appreciation if the owner sells the house.
In another proposal, Congress would create a separate account within a 401(k)
that would help first-time home buyers save for a house.
Obama proposes
mortgage relief plan
President
Obama on Wednesday touted his mortgage-relief plan, and while he did not
mention Mitt Romney by name, his comments referenced Romney’s statement a day
earlier that the housing market had to bottom out before it got any better. “It
is wrong for anybody to suggest that the only option for struggling,
responsible homeowners is to sit and wait for the housing market to hit bottom,”
Obama said in a speech at a community center in Virginia. The housing plan,
parts of which require congressional legislation, is aimed at making it easier
for homeowners to refinance. Romney has stated his opposition to this plan,
saying he instead believes the answer to fixing the housing market is not in
government intervention but in rolling back regulations and allowing the market
to fix itself.
By MARK LANDLER and MICHAEL D. SHEAR
Published:
February 1, 2012
FALLS
CHURCH, Va. — President
Obama and Mitt
Romney traded jabs on Wednesday over economic issues, from
helping burdened homeowners to finding jobs for skilled workers, as the two
appeared to be girding for a general-election fight after Mr. Romney’s decisive victory in
the Florida primary.
Luke
Sharrett for The New York Times
Speaking
on Wednesday in Falls Church, Va., Mr. Obama sought to contrast himself with
Mr. Romney.
Mr.
Obama’s attack came obliquely, in details of a new White House proposal to
help homeowners refinance their mortgages, which he cast as a humane
alternative to those who contend that the housing market must bottom out
before people can find relief. Mr. Romney made that argument last year in
Nevada.
Mr. Romney counterpunched hours later,
accusing the president of being “detached from reality” for the way he
responded to a woman whose husband was out of work. On Tuesday evening, Mr.
Romney used his speech after winning in Florida to deliver a withering
indictment of Mr. Obama’s leadership.
Never mind that the Republicans have
yet to settle on a nominee; the thumping nature of Mr. Romney’s victory has
reinforced the belief of Mr. Obama’s advisers that he will be the choice. And
the president — though he professes to be governing, not campaigning, and
rarely mentions Mr. Romney by name — has used recent speeches to systematically
assault the positions of Mr. Romney, a former Massachusetts governor.
For
Mr. Obama, the goal is to frame, as early as possible and in an advantageous
way, the choice between himself and his most probable rival. For Mr. Romney, it
is to keep his focus on the president rather than get bogged down in damaging
intraparty squabbles with Newt Gingrich and other Republican rivals, though he
went after Mr. Gingrich as well on Wednesday, questioning his conservative
credentials.
The
introduction of a package of housing proposals here gave Mr. Obama a chance to
hammer his theme of economic justice for the middle class, and to draw another
contrast with Mr. Romney. Even responsible homeowners, the president said, have
been victimized by unscrupulous banks and mortgage brokers.
“It
is wrong for anybody to suggest that the only option for struggling,
responsible homeowners is to sit and wait for the housing market to hit
bottom,” he said at a community center here, clearly referring to Mr. Romney.
“I refuse to accept that, and so do the American people.”
Housing
values in this Washington suburb have dropped by a quarter, the president said,
while more than half of homeowners in Las Vegas are underwater on their
mortgages, meaning that what they owe is more than what the house is worth. Mr.
Obama’s reference to Las Vegas hardly seemed accidental; Mr. Romney made his
comments about the housing market bottoming out to a Las Vegas newspaper.
Jared
Bernstein, a former chief economic adviser to Vice President Joseph R. Biden
Jr., said, “Romney taps into a fairly strong conservative sentiment on housing,
which is ‘liquidate, liquidate, liquidate.’ The idea that you would intervene
in housing finance is anathema to them, given their ideology.”
Mr.
Bernstein said that such reluctance would be understandable except that banks
and other institutions are not providing enough credit to resuscitate the
market. Mr. Obama’s housing proposal, parts of which would require
Congressional legislation, aims to make it easier for homeowners to refinance
mortgages.
Mr.
Romney, at a rally in Minnesota before flying to Nevada to compete in its
caucus on Saturday, accused the president of refusing to take responsibility
for an economy he does not understand. He also mocked him as disconnected from
Americans.
“Is
he so detached from reality?” Mr. Romney asked, noting that the president
appeared surprised during an online discussion when
a woman said that her husband, an unemployed engineer, was having trouble
finding work. “Does he not understand what’s going on in America?”
Mr.
Romney’s rhetorical pivot back to Mr. Obama began moments after he claimed
victory in Florida, vowing that “my leadership will end the Obama era and begin
a new era of American prosperity.”
By
Wednesday morning, his staff had offered a glimpse of its general-election
strategy, releasing a 2008 memorandum from Hillary Rodham Clinton’s pollster
complaining that Mr. Obama’s campaign had “engaged in a mean-spirited, unfair
character attack” on her, using language that was “patently false and
demeaning.” Mr. Romney also criticized Mr. Gingrich, saying that his proposal
for a colony on the moon was hardly conservative. And Mr. Gingrich had hoped to
announce the endorsement of Donald Trump, who instead endorsed Mitt
Romney Wednesday.
In Minnesota, Mr. Romney trained his
sights on Mr. Obama. He accused the president of being “remarkably comfortable
with trillion-dollar deficits” and of “crony capitalism.” And he said the
president thought foreign policy should “consist of appeasing and accommodating
some of the world’s worst actors.”
Mr.
Obama has strenuously rejected that criticism, pointing to his raid on Osama
bin Laden. Mr. Romney may find new ammunition with Defense Secretary Leon E.
Panetta’s announcement Wednesday
that American troops would wind down their combat role in Afghanistan in 2013.
But the White House, noting the popular support for the end of the war in Iraq,
seems eager to have that debate.
Even
if he does not mention Mr. Romney, the president has lost few chances to take
shots at him. Visiting the Washington Auto Show, Mr. Obama inspected new hybrid
vehicles from Ford, Dodge and General Motors and reminded people of his
administration’s role in bailing out two of the Big Three carmakers.
“It’s
good to remember the fact that there were some folks who were willing to let
this industry die,” he said. “Because of folks coming together, we are now back
in a place where we can compete with any car company in the world.” And who was
it who once argued that the government ought to let the carmakers fail? Mitt
Romney.
Mark Landler reported from Falls Church, Va., and
Michael D. Shear from Washington.
This article has been updated to reflect the fact
the Donald Trump endorsed Mitt Romney, instead of Newt Gingrich.
A
version of this article appeared in print on February 2, 2012, on
pageA17 of the New York edition with the headline: Obama’s
Oblique Attacks Hint at Romney as Expected Rival.
Selling Homeowners Short: Bank
Strategy Backfires In Foreclosure Crisis
Housing
investors and advocates are embracing a new strategy to keep struggling
borrowers in their homes: Purchasing houses from homeowners who can no longer
afford to pay the mortgage, then leasing the property back to the previous
owner at an affordable rent. The strategy looks like a winner for both
homeowners and banks. The homeowner gets to stay put and the stress of paying
what has become an unaffordable mortgage disappears. Meanwhile, the lender
doesn't have to foreclose, which is costly and usually results in a vacant home
they have to maintain until they can sell.
The
problem is the strategy is prohibited. The nation's major banks and mortgage
companies, as well as housing giants Fannie Mae and Freddie Mac, typically bar
the previous owners from remaining in their properties after homes are sold for
less than the value of the outstanding mortgage -- what is known as a short
sale. With nearly one in every five homeowners owing more on their home than
it's worth, and millions of homeowners on the verge of foreclosure, short sales
are on the rise. Last year, there were 26,000 more short sales than in
2010, according to Hope Now.
At the same time short sales are
increasing, there continues to be an oversupply of vacant homes, with nearly
one in every ten houses sitting empty, according to the Census Bureau. The
flood of vacant homes is hampering a rebound of the housing market, say economists,
by keeping home prices low. It makes sense, then, to try to avoid bringing more
empty homes onto the market. But in fact, the banks refuse to allow these kinds
of transactions unless the buyers sign legal documents promising they will not
rent the property back to the previous owner. The restrictions are designed to
limit fraud: If a struggling homeowner can sell the property for less than what
they owe the bank and remain in the home, they could find a partner to buy the
home at the reduced price, and together they could then sell the home and split
any profits.
However,
this seemingly sensible provision is now having an unintended effect,
staunching what many experts portray as a promising way to bolster the troubled
housing market: inviting investors to buy distressed homes en masse and then
rent them out.
"All
these government agencies, Fannie, Freddie, the Federal Housing Administration,
they all have this policy," said Jorge Newbery, director of American
Homeowner Preservation, a company that buys homes and rents them back to the
previous owner. "They have all this rhetoric about keeping families in
their homes, but then it's just pushed to the side. What they're doing just
seems punitive and illogical."
The
short sale policy is recent. Freddie Mac and Bank of America adopted it in
summer 2010, with Citigroup following in early 2011. Wells Fargo and J.P.
Morgan Chase declined to comment on the timing of their policies.
Investors
say the policy is just bad business. "Short sales are a third of our
market, and they'd sell faster if we could just rent them back to the previous
owner," said Steve Schmitz, chief executive officer of American
Residential Properties, a firm that bought and then rented over 500 foreclosed
properties in the Southwest. The firm is also nearing completion on a $100
million deal to acquire an additional 800 foreclosed properties. According to
Schmitz, the prohibition on short sales also makes impossible what could
otherwise be a win-win transaction.
"The
best deal for everyone is where we can lease it back to the previous
owner," he said. "The homeowner isn't being kicked out. Their kids
can stay in the same schools. For us, we don't have to pay a leasing commission
or have a vacant home. The bank wins because we'd be willing to pay more money
for that house if we could lease it back to the previous owner. The community
wins because there's never a vacant home in the neighborhood."
Ivy
Zelman, chief executive officer at financial analysis firm Zelman and
Associates, disagrees with the assertion that the restrictions impede short
sales. "I don't think it's an issue for the single-family rental market,
as investors rehab homes and have enough tenants to rent them to other than the
former mortgage holders."
Last
month, the Federal Reserve Board released a 26-page paper that
supports converting foreclosed properties to rental units. According to that
report, now is an unusually good time for such a strategy because demand for
owner-occupied homes remains low, demand for rental properties is rising, and
the problem of banks' continued hesitance to offer mortgages to everyday
Americans means the situation won't resolve anytime soon. The Federal Housing
Finance Agency, which oversees Freddie Mac and Fannie Mae, is also currently
reviewing proposals from potential buyers to convert the two companies'
foreclosed properties to rental units.
Though
the Fed report and the FHFA program focused on already-foreclosed properties --
as opposed to short sales, which function as an alternative to foreclosure --
the same argument applies to both, said Newbery of the American Homeowner
Preservation.
"If
you have a borrower who can't afford to own the home anymore, but can afford to
rent it, and wants to rent it, why wouldn't you let them?" Newbery said.
"Why would you bring another vacant home on to this market if you didn't
have to?"
Banks pay delinquent borrowers
$35,000 to sell their homes
By
Les Christie @CNNMoney February 10, 2012: 11:02 AM
ET
NEW
YORK (CNNMoney) -- In an effort to cut their losses, banks are paying some
struggling homeowners as much as $35,000 to sell their homes before they end up
in foreclosure.
The
deals are aimed at incentivizing homeowners who owe more on their home than it
is worth and who are seriously delinquent on their payments to sell their homes
in a short sale.
In
short sales, homes are sold for less than what is owed and the bank forgives
the excess debt. Banks have been reluctant to approve such deals in the past --
since they take a loss on the home -- but in certain cases, it's become a much
better proposition than letting the homeowner fall into foreclosure.
This
new approach by the banks has startled plenty of homeowners, according to
Elizabeth Weintraub, a Sacramento-area real estate agent who specializes in
short sales.
"Initially,
the homeowners are skeptical," she said. "The bank may have already
turned down their request for a modification. Then, one day, they call and say,
'Let us give you some cash.'"
When
Chase Mortgage (JPM, Fortune 500) told Angelique Pierce,
that she would receive a check for $25,000 if she sold her house, she couldn't
believe it. "I got the offer in the mail," said the Rancho Cordova,
Calif. resident. "I called my bank to ask if it was real." After
Pierce became disabled a few years ago and had to stop working work, she fell
behind on payments on both her first and second mortgages, valued at $250,000
and $50,000, respectively. Now, she's trying to sell her three-bedroom ranch
for just $95,000 -- almost half of the $179,000 she paid for the place in late
2002.
From
the bank's point of view, the offers make sense, according to Tom Kelly, a
spokesman for Chase Mortgage, who would not comment on Pierce or other
individual cases. "The first choice is a modification but if that's
impossible than a short sale is a faster, more efficient solution," he
said. For the banks, foreclosure has become an increasingly difficult and
expensive option. Homeowners have learned to fight the banks tooth and nail,
dragging out cases for years.
And
as the cases drag, expenses grow. Homeowners not only stop paying their
mortgages but they stop paying property taxes and conducting normal maintenance
as well. Roofs, siding, plumbing and other parts of the home deteriorate and
the property loses value. By the time banks take possession, they're out tens
of thousands of dollars.
"I've
seen a lot of foreclosures for sale where it would cost a lot more than $20,000
to get them into condition to sell again," said John Hayton, a short sale
specialist in Orlando, Fla, who has had a number of clients receive offers from
the banks.
Short sales also command higher prices
than foreclosed homes. In December, foreclosed properties sold for an average
of 22% less than conventional sales, while the discount for short sales was
only 14%, according to the National Association of Realtors. All that has been
true for years, but it is only lately that these outsized incentives, which
Bloomberg recently reported on, have surfaced. Sellers are more cooperative
when they're going to receive a five-figure check for their troubles.
Nick
Chaconas, an agent with discount broker Redfin, wondered why one seller was so
anxious to sell their home. "Since I represent the buyer, I didn't even
know about the incentive until the closing," he said.
It
turned out that the seller's bank was writing her a check for $30,000. Whether
sellers can expect incentives from their banks depends on multiple
factors, including where they live.
Wells
Fargo (WFC, Fortune 500) limits its offers to
certain states, such as Florida, where the foreclosure process can be lengthy,
according to spokeswoman Veronica Clemons. The bank has paid
$10,000 to $20,000 to borrowers who short sell or transfer their title to Wells
via a deed-in-lieu.
Bank
of America (BAC, Fortune 500) had a pilot program in
Florida that paid incentives of $5,000 to $20,000 for sales that were initiated
between Sept. 26, 2011 and Nov. 30, 2011 and close by the end of this August.
The amount of the incentive is based on 5% of the unpaid balance, with a $5,000
minimum and $20,000 maximum. Jumana Bauwens, Bank of America's spokeswoman,
called it a "test-and-run program" that may be expanded
to other states.
The
offers are not always a panacea for homeowners struggling to pay the bills,
however. Pierce, for example, has not been able to make hers pay off. She had a
buyer but her second mortgage holder refused to go along with the deal unless
it got a share of the $25,000 she was being offered by the bank. She said that the
bank balked at the deal and the sale was cancelled.
She's
looking for another buyer, but it's up in the air if Chase will honor its
original offer if the second mortgage holder won't cooperate. 
First
Published: February 10, 2012: 6:02 AM ET
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