You have a great point. There are certainly areas of the country where underlying economic weakness is contributing to the foreclosure rate. The ones that come to mind are Michigan and Ohio. Historically unemployment has been a huge catalyst for heightened foreclosure activity.

I'll try to post something correlating the two in the next couple days.

Thanks for your question. Let me know if this helps:

"Foreclosure Filings" represents the total number of foreclosure-related documents filed in a given time period. These can include default notices, foreclosure sale notices and bank repossessions.

The "Properties with Filings" is a count of properties with at least one foreclosure-related filing during the given time period.

Over the course of a year, it's possible that more than one foreclosure filing could be filed against a given property, so the filings number over that extended time period will be higher than the properties with filings number.

What info are you looking for?

We can probably get you county-level data for your area. I'll have data for the Norfolk metro area pulled. Daren

I definitely tend to agree with you; however, I think that a lot of the buyers in trouble right now weren't exactly flippers, but they did take advantage of the market conditions and the mortgage products out there to leverage their credit to the hilt to buy a lot of house with very little down and for relatively low (at least to start with) monthly payments. While I don't think we should bail these people out, I think if at all possible these people should be encouraged to stay in their homes and keep making their monthly payments (this may require some capitulation on the part of the lenders to keep the payments lower and not let them reset to astronomically higher rates). Otherwise many of those people have little incentive to stay, and walking away will ping their credit for a few years, but it will have a more adverse affect on the overall market and those who continue to make their monthly payments faithfully.

It's better for everyone if more people stay in their homes and keep make their payments; however, I still agree that the efforts on the part of the government -- particularly using taxpayer money -- should be extremely limited. The market will correct itself, albeit painfully, and wise buyers and investors who have not overextended themselves in the recent hot market will be have an opportunity to make some very good buys in real estate during this painful period.

You can read the full RealtyTrac 2007 year-end foreclosure report on our website.  

Go to the RealtyTrac homepage. Scroll to the bottom left-hand side of the page to the "Company Information" section and click the "News and Events" link.

In the "News and Events" landing page, click the "Press Release" link.

Then click the second press release titled:

"U.S. FORECLOSURE ACTIVITY INCREASES 75 PERCENT IN 2007."

Here's a video from CBS News addressing the issue of renters being forced out of their homes by foreclosure. They used data from RealtyTrac for the numbers cited here, which is that roughly 38 percent of foreclosure properties nationwide are on properties that are not owner-occupied. We do not regularly publish this information but we pulled this especially for CBS News. We looked at the owner mailing address on properties to determine if it matched with the property address.

Thanks for your good questions. The 1 in XX number of households is based just on activity that occurred in the first quarter, so it would not include a property that maybe entered foreclosure at the end of 2007 and is still in foreclosure but did not have any new activity against it during the first quarter.

Unfortunately our report only goes back to 2005, so we are now at the highest foreclosure rate levels we've seen since we began tracking this.

However, if you compare our foreclosure rate to the MBA foreclosure rate, they track similarly for the past couple years (although they are not the exact same number because MBA calculates percentage of all mortgages instead of percentage of all households). The MBA has been tracking this since the 1970s, and it said in its fourth-quarter report that "the rate of foreclosure starts and the percent of loans in the process of foreclosure are at the highest level ever." See http://www.mortgagebankers.org/NewsandMedia/PressCenter/60619.htm

Nancy,

I've heard the same thing from other agents in other markets. I think there is too much inventory and the buyers can't decide what to buy.

Dear Sell My House,

Agents in other markets — including Miami, Las Vegas, Stockton, Detroit, Cleveland and other distressed communities — say lenders are starting to negotiate on price. Lenders who have huge inventories of unsold REO properties are especially interested in selling their inventories.

The bottom may not be in sight in some markets just yet. Although rents are now in line with mortgage payments, there still is not a balance of buyers and sellers out there.  With the pressures of more and more foreclosures coming on the market and the market being saturated with unsold homes, there will only be downward pressure for prices — especially in parts of the country where it boomed most. Furthermore, financing is not as easy to obtain as back in 2004, making it difficult for more people to get into a home even though rents are higher than mortgage prices respectively. Although it is a more opportune to buy, price drops will resume.

Doug

The worse is yet to come. As the market is absorbing the last wave of subprime foreclosure, another bigger wave of possible foreclosure triggered by Option ARM is preparing to take off.
       Option ARM loan or so called balloon loan does not reset in two years. They reset after three years or after. Many of these borrowers are categorized as Alt A. They are just as toxic as sub prime or even worse because borrowers can state their income and lenders take it without further question. These borrowers do not have documents to support their income because they are either self employed or contractors. It is not hard to imagine what will happen when the interest rate increases and unemployment shoot the high level. These Alt A borrowers will be in the same boat as subprime and they face worse consequences because many of them may qualify for higher loan amount in their loan. When they default, bank losses will shoot to the sky — and many homes will be foreclosed.

I don't know when is the best time to buy, but this is something at the horizon and many agencies see it coming. Homebuyers will have to make a decision if they are willing to take the chance.

That’s my 0.2 cents.  

Responsible Homeowner

Hope the new legislation will bring down the numbers for this month.

Marina

That's a great graph. I am a French journalist and would like to publish it in our newpaper. Do you think it would be possible to get the raw data so that we can draw it?

Christian Chavagneaux

The new legislation wont bring down the numbers. Along with the option arms homeowners are faced with growing negative equity. One option is the FHA Secure Short Refinance for a portion.  The best choice is to do a workout with their current lender if that is a possibility.

Paul Dunn

Hi Daren,

Thanks for the graphic. I am from a newspaper in Toronto, and I am wondering if can you email me the raw data as well? Thanks.

Fernando

I can see what Greg says is happening now and I agree with him, but I hope that it doesn't get that bad. Of course, every time I think it won't get that bad, I remember the Savings and Loan scandal of the early 1980's, and Enron and World.com. Also, the $4 per gallon of gas doesn't get our hope up either. I guess this is what happens when you allow your country to be sold to the highest bidder. Morals, ethics and integrity get lost in the bidding price for the White House.

I agree with you.  It's like the payday loans with some of the people wanting to be bailed out. I understand that things happen in life; they've certainly happened to me, but I also think that only a minority of the population is as foolish and irresponsible to ask for bailouts from the taxpayers when they screw up. I hope I'm right.

Great post. I agree that foreclosures are the most problem prone properties. There are many different potential problems that can come up when buying a house in a distressed situation.

Jon Christopher

Seems the FDIC head just issued a statement saying outlook for the ailing banking industry was bad — and getting worse.

Despite having a thriving economy with a 3.5 percent unemployment rate, and more jobs than homes, buyer confidence has been mixed. Until this week, however, we are seeing the LLC investors stepping into the distressed market to capture excellent value within bank-owned inventory. Investors from New York City that previewed foreclosed investments in January 2008, have returned with confidence to actively acquire a diversified portfolio of properties. The restructuring of Fannie Mae and Freddie Mac  —and the added effect of lower mortgage rates — has indeed caused buyer confidence to increase. In Fairfax County, Va., bank-owned volume is at 417 units, while short sales are at 1,100 units.

Joe Henry

Realtor
joe.henry@longandfoster.com

 (571) 282-8249

I read the post. It is really interesting. Thanks for sharing it with me.

Bobby Korey

It is optimistic to assume that the correction will end by 2009. This has been a long overdue correction, which has been artificially re-routed by policymakers, and what should have taken one or two years to correct, will in effect take three or more years to correct.

I think homeowners, and investors should prepare realistically for a longer term hold for their real estate. In the long run though, the surge of immigration to US and the inflationary atmosphere of the world economics will ensure that real estate in the U.S. will definitely recover. In many areas, the properties are selling 30 percent below the replacement value of the properties, which is a temporary opportunity for the buyers and future investors, and a hardship for the homeowners and current investors.

But the correction will be a lot more dramatic in the years to come, before buyers, sitting in the sidelines, will step back in and reduce the market inventory. And investors with liquidity will permit their funds to be used for funding mortgages. Until then, fasten your seat belts, we are in for heavy turbulences!

Maryam Farzad

Have you noticed that CA accounted for 92 percent of the increase in foreclosure activity from July to August and also increased its share of Notices and REOs. If we stop calling this a national problem and loosen credit, maybe the buyers will step in.

It is still seems a bad time to buy. I don't know much about housing value in other states but am following closely the price trend in Inland Empire as well as LA county.
Home prices in Inland Empire cities such as Fontana, Riverside, Corona, Rialto and Rancho Cucamonga have dropped about 30% from their peaks, in general terms. But if you look the the price of the same house, it is around 2003-2004 price range. Many of those houses are still unreasonably high. Sellers just don't want to admit their houses are not worth that much. In my opinion, we are going to see around 50% home price drop from peak in 2007(for south land) before price can stabilize.   

If you move westward other cities like Upland, Claremont, La Vern, San Dimas, Glendora, Azusa, Covina, Monrovia, Arcadia, San Gabriel, Temple City, Alhambra, Rosemead and Monterey Park, house price does not drop too much, probably around 5 to 10%. Until the affluent area like Arcadia, Altadena and  Pasadena  and etc. see a drop of close to 30% or greater in price, we are still have a long way to go. Not to mention west of LA.

Many reports, either paper or internet, always exaggerate the price drop to XX%. One thing these reports do not stress is the unrealistic peak value they compare to. A 100k house can be worth 100M or 1Billion as long as it is not sold. The real worth of a house is how much it is sold, not how much the similar house sold three months ago down the street. 

 My feeling is the price drop has not completed its course yet in LA area. It will have to go back to 2000 level before stabilizing. The sooner the price stabilizes, the sooner economy will rebound. Recent Congress and Senate actions will just prolong the downward trend and make it worse that it should be. If renters see little incentive to rent rather than owning a house, they will start buying. Only thing that keeps renters from buying is the house price. 

The sooner we get to the level that average renters' income can afford a house mortgage, the earlier the economy will stabilize.

Just my .02 cents.

Brandon,

Thanks for the chart. It is sobering to realize that we've just gotten through one wave (subprime) and are heading into several more waves of risky loans. Of course, the difference now is that lenders and government entities are aware of these coming waves and are bracing for them. For example you see Bank of America adopting a massive, systematic loan modification program. And you see states passing laws, like California's SB 1137, aimed at giving homeowners a better chance of getting a loan workout rather than a foreclosure.

Depending on how far the lenders and government are willing to bend backwards for bad loans and irresponsible homebuyers, we could see a mitigating effect from all these efforts.

Steve,

We see some moderation in the numbers in that the year-over-year percentage increase in defaults and auction notices is beginning to slow -- it's still increasing, just not as much.

The problem is that much of that moderation could be because of out-of-the-ordinary intervention on the part of lenders as well as the government. And that intervention could just be damming up another coming flood of foreclosures or it could actually be having a lasting impact and helping folks stay in their homes for the long term. So we're in a bit of limbo right now in terms of projecting where the trend is headed.

Daren,
    I'm just glad to find out my opinion is within reasonable range predicted by a professional. I don't do research or number crunching. All I have is the real life incidents around me or my friends.

Our economy is in deep trouble now. Part of it, if not all, is caused by overpriced houses. Now, everyone is lack of confident with the country's economy, and we can point the culprit to the dropping house prices. If the house price were to drop, why not let it drop faster and bottom out sooner. When home prices are attractive to renters, remember there are about 30 percent of U.S. households who live in rental properties, these renters will jump in and start buying.

Of course, the other 30 percent of current homeowners will feel the pain financially. Worst case scenario, the existing homeowners become renters again. And, current renters will become a new wave of homeowners. These new homeowners, many of them, have saved for many years waiting for this day to come. So they are more likely to qualify for a loan and likely to stick with it. I'm not saying current homeowners are all speculators. It is just that they are unlucky to buy their houses in the wrong time. When buying activities increase, the economy will be revitalized, if not flourish.

The end result of this event is the transfer of home ownership from a group 30 percent  to another group of 30 percent — homeowners become renters and renters become homeowner.

What we gain is the confidence that we have been hungry for to jump start the economy. I believe the new homeowners will be more responsible than the current homeowners because their mortgages are more affordable, as a result of lower house price, and they have been saving for so long to come to a better financial position.

We sold our DC home at a great financial loss. The buyers got a heck of a deal and bled us dry for everything they could knowing what type of market they were in. We had to do it, sadly, because of our elderly parents in need of assistance — so we moved to South Florida. We would like to purchase a home in Weston (Broward County), however, the market there is even worse. Everywhere you look it seems every other house is in foreclosure and the prices for home listings are still "wishful dreams" of their sellers (as the woman from California stated). We tried to do the right thing but are personally a bit peeved because we worked hard, paid our bills, and bit the bullet and sold in a downward market and now people who are in foreclosure or defaulting because they took out big loans they couldn't afford and pay for, who bought Hummers, boats, and luxury items with second mortgages are now to be forgiven with the banks; getting their balances lowered to market values and lower interest rates to fit into their budget. Wow!!! I guess we should have saved our money and just walked away from our loan.  

If I were to buy a house, I would wait until 2016, when the market will probably pick up. I think there is more downside in the economy with the current credit crisis. It will take that long for the confidence to return and families are able to re capitalize their balance sheets. Also, you will need to see a fall in the number of foreclosures to pre-2005 levels. I think this will be when there are about 7 million foreclosed homes. The first indicator will probably be when unemployment stops rising and does begin to fall. The other issue is if you buy now as an investor you may be lumbered with a property you can't rent due to rising unemployment. Unless there are government incentives to buy a home, I think when all these factors are considered that would I assume be the bottom.

How sad......to lose your "private sanctuary" in such a hostile and violent world. Her husband is apparently "gone" and she felt she had no other solution. A sad story I'm sure we'll end up seeing a lot more of in the future!

I totally agree with the comments made on the Los Angeles area.

We live in north San Diego and we see a lot of “short sales” and foreclosed properties in some neighborhoods (e.g. Oceanside) but far less in other areas (e.g. Carlsbad).

We don’t have a problem getting a loan, but the main issue we are facing now as a buyer is that prices are still too high, despite the large drops from their peaks. Many banks and owners are still not willing to lower their prices. Understandably, they don’t want to take their losses and perhaps are waiting for additional bailout from the government

With the upcoming severe economic downturn, why would anyone buy now at these high prices?

I really like your website.  

I too am trying to help homeowners who are facing foreclosure.  I am a foreclosure attorney who works for most of the big name banks currently involved in the mortgage foreclosure mess.  I have written an eBook all about how to stall your foreclosure long enough to successfully sell your house or to modify and reinstate your mortgage.  

It is available at www.ForeclosureDefenseSecrets.com.  I also have a blog regarding the current mortgage foreclosure crisis located at www.ForeclosureDefenseSecrets.com/thoughts.  

Perhaps we can work together to alleviate the foreclosure crisis currently facing our country. Feel free to email me at ForeclosureDefenseSecrets@gmail.com.  

It amazes me that a house somehow becomes more valuable as it ages, when a car loses value just rolling off the lot. It seems crazy that real estate history appraises itself higher and higher, with loan and bank companies and anyone else who runs with the pack feeding the fantasy. We need to return to reality, with home values that fit into the budget of hard working American families. Stop fanning the fantasy of the “American Dream” of owning an outrageous debt for the next 30 years.

Our banks have loaned out large amounts of money, with balloons and ARMs, which normal citizens can not pay back — and if you have a roof over your head be thankful. 

Julie

How insensitive can the mortgage companies become before they are forced to relent or deviate from their greedy ways? God help us all!

Gary Cummings

What is a 90 year old woman doing taking out a 30 year mortgage anyway?  And what did she do with the money when she closed her loan in 2007? I bet one of her relatives talked her into it. I see that all of the time in my field, the elderly being taken advantage of by some young relative — and then absconding with the funds.

Suzanne

Daren,

I'm a big fan of your foreclosure research. Your charts are awesome and much appreciated.

J Javier

I believe prices will continue to fall, along with the stock market. Prices in most areas will drop on average another 20 percent and the Dow Jones Industrial will drop another 6,000 points.

Dean

Rae, where do you get 31 years old?  She bought the house in 1970 — that means she was 52. Then 37 years later, in 2007, she took another mortgage at 89. I agree it’s a mess, but the bank should expect to be paid back when somebody takes a loan. A loan is not supposed to be a social service. I agree with Toni on the co-signer idea.

Donna

If you give an elderly person a 30 year mortgage because you are a money-hungry mortgage broker, then the college graduate who allowed the loan to go through, fully knew it most likely will not be paid back. Yes, the loan should be forgiven, but before an old woman has to shoot herself, please! The banking business has zero morals.  

Norman

I am a housing counselor and unfortunately I see this sort of thing all the time. My question is — why wasn't she offered a reverse mortgage if the home was paid for and all this equity was in the home? This would have at least allowed her to stay in the home and not have the worry about making monthly payments. Shame on the person who sold her the loan. Remember you have to answer to a higher authority!

Jon

To all who wonder why the bank approved a 30 year mortgage, the fact of the matter is they had no choice. It is illegal to discriminate in a loan decision based on age. If she otherwise qualified, then the term of the loan was not a factor. She probably needed the 30 year amortization to keep the payments low enough to qualify. Not that the mortgage company was completely blameless. I'm sure they could have counseled her more effectively.

Kevin

I think housing prices will keep dropping until they are three times the average income. There has been a lot of discussion on how much prices went up and when, but no discussion on income increase — a traditional bench mark of house size. We sold in 2005 when we realized we could not buy in our neighborhood nor could any of our neighbors. We are still renting for approximately $500 less a month than a mortgage payment would be on a similar house in the same neighborhood with 20 percent down. We don't pay for maintenance. We probably won't buy again until it's a little more cost effective.

Melissa

There are consequences for your actions. If all you had to do is attempt suicide to escape debt, how many would do that? There is a law that makes age discrimination illegal. If she applies and qualifies for the loan the lender must give it to her without concern for her age. That's the government (again). I want my loans forgiven too! Should I stop paying and get my guns ready?

Paul

I agree with both sides. This lady should never have gotten a 30 year loan at 89 years of age. What was the bank thinking? (They were not — and that's the problem) Just some young desk jockey getting a notice that this loan is paid off so they automatically send out a letter asking for another mortgage on the home and never looking into the situation. Now if the lady went to the bank for a loan (what ever the reason may be) then you can't fault the bank. The only fault is the 30 year loan part. A woman that age can never be expected to live long enough or have the finances to pay this loan back which leaves the burden on the family members. People need to STOP living beyond their means and yes I do believe that the banks should foreclose on a loan in default. I feel sorry for this woman and would not like to see her evicted because I do not know why the loan was taken out, but to all of the people that jumped on the bandwagon of  “Oh I’m going to sell my house for “sooo” much money and get a loan for a bigger house so I can flip it and get even more money,” then I say it’s time to pay the piper. You took a gamble and it did not work out. Would you go to a casino and after loosing say you want your money back? Start living as to what you can afford to pay. If you don’t have the money, then don’t do it. Wait until you have enough, then do it. So you need to wait a little while before you get it. My heart goes out to people on medicine and that takes away so much of their money that they can’t afford other needed items. That should be where the federal funding should go. Lowering the cost of needed medicines would allow people to afford more things and provide a happy and health person.

Yeap

My friend just tried to get a mortgage, and the local bank tried to sell him an option ARM! Luckily, he checked with me first. Why are we paying billions in a bailout, when banks are still doing this? He was never told the risks, just the rewards. They also tried to get him to combine his current low interest loans into the mortgage, which had a higher interest rate. They could have put him in a real pickle, and he would have realized it too late. The tax gains wouldn't have come close to offsetting the losses, at his income level.

Shameful.

After I explained the pros and cons, he was shocked — and very thankful. He won't be as trusting of lenders, after this.

Concerned

As a Realtor, I saw this coming and sold my own home last year for a nice profit. I moved into my rental property and will qualify for a tax-free sale next year.

Those of you who have owned a home for four or more years are probably sitting on ample equity (profit). If you have to or wish to move, consider selling for a tax-free profit and buying your next home at a significantly reduced price.

I'm looking for another home in which to invest the cash from my sale. I'm glad I didn't put it in the stock market!  

I believe prices still have a way to go down, and I'll be ready to buy when I see better values in my area — maybe in 2009, but more likely in 2010.

Remember the old real estate adage, "locationX3" and follow (1) the price trend in your local area — metro region, county or city), (2) "days on market" statistic and (3) supply/demand ratio (inventory in months). They will indicate when we hit bottom and the rebound is starting.  

Rich

Another important note: The Case-Schiller Index tracks only 20 major metro areas, most of which "bubbled" far more than the rest of the nation. It's skewed with the most volatile cities, while real estate market changes have been much less across the U.S.  

The index was created as a Wall Street hedge fund tool so "Schiller" is a very appropriate name. Consult your local MLS Realtors for more accurate numbers and trends.  

We are on the front lines in your town, and we know what is really happening with home buyers and sellers. Despite the negative headlines, buyers are still looking for houses, getting mortgages, closing and moving in.  "The glass is half full," but the media headlines merely focus on "half empty!"    

We have a local contractor who has overbuilt and now is being pressured by the banks for their money. I recently offered 25 percent below their already reduced asking price. I’m still waiting for word from the lender who holds the construction loan. If they are smart they will accept my offer. If not, I'll walk away. Be patient and stand my ground. People need to sell much worse than you need to buy.

As Warren Buffet says: “Be fearful when people are greedy, be greedy when people are fearful.”

Now is a great time to buy if you plan to hold for 5 plus years, maybe longer. Prices may drop further but interest rates could rise. I'm from Washington state.

Steve

This "economist" is paid by a lobbying firm, trying to convince everyone to start buying.  She is wrong, wrong, wrong.  Consider the source people; she is a lobbyist than an economist.  Every prediction she made since 2007 was wrong, wrong, wrong.  Why the press gives her a podium is beyond me.  

Marin County Man

To Yeap,

I agree! We heard years ago that this was going to happen. People were warned about the housing crash and rising mortgage rates. Some people I do feel sorry for. ARM's were not suppose to jump this high so quick. Now, people are losing there jobs.

I could have very easily been one of those people. My bank told me I could afford SO MUCH MORE HOUSE. I told them not if we wanted to eat. It is not hard to add bills and everything together, allow for tax increases — and than figure from there what you can actual afford.  

If your ARM was going to be 9.5 percent a year, you should have figured your mortgage at that rate.  AND YES Mortgage companies took advantage of far to many people. And now look where they are!  

 It is absolutely unacceptable that Addie Polk was given a 30 year mortgage at 89 years old. Additionally, Countrywide should have to absorb this write-off and not the taxpayer aka Fannie Mae. Someone needs to hold them accountable!

Ross

Unfortunately, there are all different situations people find themselves in — and some of them can be prevented. For those who have foreclosed due to disabilities relating to sickness and injury, there are insurance policies for Accident and Disability, to keep your income going in the event you are disabled due to an injury (not self inflicted) or sickness that could be detrimental and catastrophic to your financial situation.  

As an insurance agent, I have seen so many situations happen because people do not know there is coverage for these types of situations, or feel that they do not need them until they are faced with it. The lucky few who realize that they need the coverage are the ones that have either seen it happen to someone else, or have had it happen to them before. In this case, I cannot comment because like so many people have stated, her whole story and all the facts have not been disclosed... but I can tell you that if you are concerned about it, talk to an insurance agent about a Disability Income policy that would help prevent the financial repercussions in case it should happen to you. Protect yourself, and protect your family from the things that you cannot predict. You may not be able to predict them, but at least you can plan FOR them.

Melinda

We live in the San Francisco peninsula area. We just purchased a home in Palo Alto. We have been looking for one year. Multiple offers still are going on in this area. There are longer days on market, but the prices are not "tanking" by any means. We decided we are going to live here for at least 7 years, so we decided to buy now. Historically, it all evens out. We realized we are still in a pretty healthy  market.  

Kaitlyn

I feel for this old lady. I know how stressful it is to go thru foreclosure. In my case, we almost lost our home due to some illness. I had 6 weeks before the sale date. I applied for a modification using mortgage modification servicing in Florida. They did all the negotiation after I sent all the needed paperwork. It took six weeks, but got it approved, from an 11.7 percent interest rate all the way down to 6.75 percent. It was worth paying them $1,500 for all they have done. Now I’m still in my home — better yet the payments have gone down a lot.

Connie

What about prices for vacant lots or land. Will we see a continual decline in prices here too?

Randy

We are in escrow on a short sale and it's supposed to close next week. Although we feel sorry for those who are losing their homes, for us, this market is a great deal!  We are a young family in the California Bay Area, and for years, no matter how we've scrimped and saved and taken care of our credit rating, it's been impossible to achieve our dream of owning our own home. While everyone around us was buying in 2003-2007, we knew that a zero percent down and interest-only loans were a dumb move. I don't care if prices don't go up until 2020, because we are buying the house of our dreams (Well, our more modest dreams, I admit) for only $325,000. We decided to hurry up and act, because the government keeps talking about helping homeowners stay in their homes, and if they find a way to do that, we could be scrimping and saving for a lot longer.

Mel

I really don’t think the little lady should have not had to go to the extreme as to take her life. Thank God she will live, but why does a little old lady have to go to that extreme? Where do you draw the line? Big companies should leave the elderly the heck alone.

Dawn

The lady took out the loan. The banks can't be held responsible for giving her a loan. It is illegal to turn down a loan because someone is old! The fact is that she accepted the terms and less than 2 years later defaulted on the loan. How is that the banks fault and how should they have behaved in the first place? You bleeding hearts would cry if they refused the loan because of her age too! Give me a break!

Doran

We hope to buy in 2009 sometime, but the right property and at the right interest rate and the 'right everything' that we want, must be in place.  At least that's our outlook and plans. Wish us luck!

Parfie

Call me naive, but if the original loan was taken out in 1970, and 37 years later another 30 year loan is required, then I believe there is some information that is missing. Something does not add up.   

Mike

It’s easy to say that the bank should have thought twice about giving this lady a loan but one should think before they make that statement. If that is the case, then the banks should have thought about giving all the many people that are in foreclosure today loans. To say that one is living above their means is insensitive. Rather than judge, why don’t we try to find a solution?

Brown

For all who did not read the article, including Jon, Kevin, Paul and Yeap. Her husband bought the house in 1970!

In my opinion, to fix the housing problem is plain and simple. Home prices need to return to the level where an average household income can afford a mortgage — after down payment. Whatever government does just prolong the pain. Artificially inflating prices at an unaffordable level will just encourage more future foreclosures.

Forgiving debt and writing down loan balance will encourage people who are currently paying their mortgage on time to purposely stop paying.

According to today's news, Countrywide will give a homeowner $2,000 dollars if the rework is not approved. What a deal. Attention to all homeowners who missed the boat in the last housing boom. Now is your chance again. You should stop paying your mortgage now or you will lose the opportunity to make tens of thousands of dollars. I'm just joking.

Encouraging Americans to over burden themselves with debt will not solve the problem. The mortgage should not exceed more than 33 percent of the household income, period. And at least 10 percent, preferably 20 percent should be required as a down payment for all mortgages. Someone will claim too many people will not qualify. Then let the prices fall further, then more people will qualify. If they still don’t qualify, they should not own a house. They should RENT. Owning a house is not a right or a privilege. It’s an obligation and responsibility.

 Also, I'm a little amazed and cannot understand this claim by Sidhu.

"About 85 percent of banks have tightened their lending standards. This is an issue. That’s where the problems are in the economy.”

When has tightening lending standard become and issue and problem to the economy? I think it is just the opposite. Tightening credit discourages speculators and promotes responsibility. In addition, it makes sense from business perspective. Why should I lend my money to someone that I'm not sure they can promise to pay off the loan?

Responsible Homeowner

Seriously people, you can't always blame the banks for the bad decisions consumers make. You start blaming the bankers and you have things like Nazi Germany come to pass. How did that start? By blaming the bankers.  

The lady can get a 30 year loan at her age because in this country we do not practice age discrimination. If she was smart and really needed money she should have taken out a REVERSE MORTGAGE. She could have tapped her equity and then stayed in the house until she passed without ever having to make a payment back to the lender.  

It sucks but you have to pay your debts back.

Lender

Yeah, Paul. You are right. If you die after a suicide attempt, I am pretty sure that you don't have to pay up.  Hey, maybe if you sell all of those guns you speak of, you can pay off some of your debt?

Lauren

Um, hey Rae?  I agree with Suzanne. And yes, apparently she did read the article. She bought the house in 1970 and took out a mortgage in 2007...at the age of 90.  He bought the house when she was 42. I don't feel one bit bad about it. The mortgage companies are just doing their job. Does no one see what is happening in the economic world? Mortgage?  Either way you look at it, the bank will probably end up with it anyway.

Stephanie

I meant "52" years of age.  And yes, I also wonder, why wasn't she offered a reverse mortgage?  Either way you look at it, the bank will probably end up with it anyway.

Stephanie

It all comes down to the Democrats support of CRA and predetermined results that would make election 2008 more favorable for them. The Commander in Chief happens to be Republican, so they place the blame on him.

Go McCain — you tried to avoid the housing crisis, the Democratic Majority just wouldn't have it.

I know better

Some people who made comments don’t know how to calculate this lady's age in 1970, when she originally bought this house.

Banks have become real strict on their lending policies and qualifications. They are in protection mode to protect themselves and the potential home buyers.

Peter

We had a lot to build on in the country. We had the plans — a nice modular (4 bedrooms) picked out. Loans all in order (no balloon payments or anything), but we looked at each other in the 11th hour and sadly agreed that if anything happened we would be strapped and we didn't want to live like that.  

So we sold our lot (our dream) and bought something older, smaller in town. It was just going to be for a few years as he was back in school finishing his degree.  Three and half months later — after moving into this house— he died at 47 and here I am with our three kids. 

Now, where is a good place to go to get solid advice about re-financing (rates, when is it really beneficial and not just for the loan people, how could getting the property tax adjusted down affect things, etc.?) I trusted my husband because he kept our feet on the ground no matter how tempted we were to try to keep up with the "Jones," but now I feel lost, but don't want to waste money if I could improve things.

Good post.

Auberta

I have to agree with Jon in this instance. A reverse mortgage would have probably been the smart choice. I don't know if Mrs. Polk has relatives who could have guided her in making a proper choice. I know it's hard. My father is  85 years old and its very hard to talk about finances with him and get him to understand the consequences of his actions. There is no doubt hers was an extreme case. Thank God she's still alive, and thank you Fannie Mae for having a heart. This was a horrible situation, but we've seen others like the couple who turned on the car and gassed themselves to death in the home they were losing to foreclosure. No matter which way you look at it, there's no easy solution here. However, we can't, and shouldn't, bail out everybody who makes a bad financial decision.

joelc

I find it interesting that everyone jumps on the mortgage company for being insensitive.

Other sources are reporting that she ignored all attempts to collect on the debt. Had she called the bank and pleaded her case would it have brought about a different end? We don't know.

But burying your head in the sand will NEVER bring about a different scenario than the worst.

I feel for everyone involved in this horrible situation.

Toby

Instead of bailing out AIG to the tune of $85 billion, I'm in favor of giving $85 billion to America in a “We Deserve It Dividend.” To make the math simple, let's assume there are 200 million U.S. citizens who are18 years old.

Our population is approximately 301 million counting every man, woman and child. So 200 million might be a fair stab at adults 18 and older.

So divide 200 million adults into $85 billion that equals $425,000. My plan is to give $425,000 to every person who is 18 or older as a “We Deserve It Dividend.” Of course, it would NOT be tax free.

So let's assume a tax rate of 30 percent. Every individual 18 and older has to pay $127,500.00 in taxes. That sends $25,500,000,000 right back to Uncle Sam.

But it means that every adult has $297,500 in their pocket. And a husband and wife has $595,000.

What would you do with $297,500 to $595,000 in your family? Pay off your mortgage and the housing crisis would be solved.

You could repay college loans — what a great boost to new grads. Put away money for college. Save it in a bank.

You could buy a new car and create jobs. Or invest it in the stock market; capital drives growth. You could pay for your parent's medical insurance; that would improve health care. It would also enable “Deadbeat Dads” to come clean “or else.”

Remember, this is for every adult U.S. citizen including the folks who lost their jobs at Lehman Brothers and every other company that is cutting back. And of course, it would be available to those serving in our Armed Forces.

If we're going to re-distribute wealth, let's really do it, instead of trickling out a puny $1,000 economic incentive that is being proposed by one of our candidates for President.

If we're going to do an $85 billion bailout, let's bail out every adult U.S. citizen. As for AIG, liquidate it. Sell off its parts. Let American General go back to being American General. Sell off the real estate. Let the private sector bargain hunters cut it up and clean it up.

Here's my rationale. We deserve it and AIG doesn't. IT'S OUR MONEY! Sure it's a crazy idea that can "never work" How do you spell Economic Boom? I trust my fellow adult Americans to know how to use the $85 Billion. We earned the “We Deserve It Dividend” more than the geniuses at AIG or in Washington D.C.

And remember, this plan only really costs $59.5 Billion because $25.5 Billion is returned instantly in taxes to Uncle Sam. Also, a sobering thought a "We deserve it" bailout would cost we tax payers $615,000,000,000 less than another proposed $700 billion big bucks greedy Bailout.

Funny... still declining home prices can be considered good news!  I am talking to more and more people who haven't missed a payment yet — but are heading for trouble.  

Daren,

It would be greatly appreciated if you could send/direct me the link to where you obtained the foreclosure data? I'm trying to substantiate the trends by obtaining actual numbers. Thanks very much.

God Bless America!

We need his help removing all those greedy devils in Washington. They have totally lost it. Could you imagine the mess we'd be in if all private industry acted as they do. As a real estate appraiser I saw this fiasco coming.

Seventy eight million baby boomers sucking the wealth out of there homes and social security being pilfered, we are in serious trouble.

Why bail out the banks who have never gone out of there way for the average working man? How do you get in such trouble with the amortization schedule currently used? How about changing the schedule to allow a quicker principle payoff, that way everyone can benefit not just those in trouble?

I agree with Gary, it is time to put the law benders back in school and teach them some logic and morals they too are sucking the wealth out of our society. I just hope my three young sons don't despise me and my generation for lack of combined action.

We are running out of time people, we need to stand up together and return the government to the people as our forefathers meant it to be. No more career politicians, we need successful private individuals to do a term for there country and go back to there place of business. Term limits to avoid collusion and inbred corruption.

They gave us $150 billion as a stimulus and now there are giving a select few almost five times that amount. What is wrong with this picture? Do they think we are that stupid?

Come on America lets join together and stand up to this Goliath and take our country back to the grandeur it had and all of us deserve.

Mike Scheu

As I forewarned most of my friends about this buyout plan, we now are beginning to see where this money is going and how it is not being used in the manner it was sold to our Congress.

It is actually being given to certain banking institutions who were supposed to begin lending practices in an effort to unfreeze the credit crisis. Well as told by angry people who voted against this buyout it is not being utilized as intended, instead these banks that are being awarded these funds are acquiring other troubled banking institutions in an attempt to become even larger and in essence are hoarding the money rather than lending it as intended initially.

We the American people were lied to again.

Shannon R.

I brought this up to Nouriel Roubini at a D.C. think tank event last week. His response was that the problem was never just housing.  It was a set of easy-credit asset bubbles spread throughout the global financial system.  

Jeff in D.C.

What if the feds just bought anyone's mortgage that wanted to participate in this program:

1. Fed buys your note, You now pay the Fed at a fixed 4% for 30 yrs. (Fed currently loans to investors aroun 2%,Correct).

 
2. Anyone who participates can NOT borrow against the property for 8 yrs or for as long as they own the property! It can only be sold to exit fed program!

This would allow the majority foreclosing home owners (the ones in subprime loans)to now afford there house. The neighbor is now 90-100% financed when he was only 70-80 two years ago. Now also benefits by reducing his payment, which frees up money for him to put in to our faltering economy.

Also wouldn't this now generate revenue for the Feds? Help the home owners themselves, ALL of them, Put consumer spent money into the economy, and make the fed more money that they now make lending to investor nexworks???

Another idea!!

Again anyone who participates must AGREE to Borrow against their property again for a certain timeframe, 8 yrs or while they own the property.

My understanding is the Fed loans money to the investor who inter-loans it to the bank that holds your note!! Basiclly right???

What if all three of the parties agree to reduce their rate buy .5-.75.?

This could reduce home owner notes by 1.5 - 2.25%. Again wouldn't this save a lot of the foreclosure home owners and give extra, SPENDABLE cash for the struggling home owner?

All three parties of the loan process take small cuts, save homes and put money in people's hands for them to put into the economy, Go to dinner again, shopping, Buy a car from the limping auto manufacturers, turn their thermostates back on for the energy industry, buy tickets for air travel... so on and so on.

What am I missing???

It’s clear the new federal legislation and the lender initiatives will make it very difficult to pull meaningful trends from these statistics. But perhaps after the moratorium subsides, we will see what most have suspected all along — an extended crisis.

Colin

Seems the state legislature is very pleased when it sees people suffer for long time. The new law is not even a band aid. It is just pushes the disaster back a few months. What are they going to do after the extra time is used up? Foreclosure notices will jump again. Are they planning on another push back?

Number of foreclosure will hit its peak after all disqualified home buyers default on their mortgages. When that time arrives, the real turning point or plateau will be reached. That is the point when buyers will regain confidence with the housing market. The idea of supply and demand will show its magic hand in the housing market. The U.S. has been the pioneer of the free market. This is the free market in work now and we try to interfere with its course. If the lawmakers want to interfere the free market, why didn't they come up with a law in 2003 to prevent explosion of home values that last 4 years? May be this is something we should think about in the future.

Yes it may be a sad situation as there are many of these around the country. I am in the business of cleaning the homes that have been foreclosed on and have seen many different scenarios played out like this one. I also know that a typical foreclosure happens after about 18 months of non payments, depending on the lender.

There is obviously more to this story as she took the loan out in 2007, and defaulted in 2008. And with them trying to evict her 30 times prior tells me either she is either alone with not much family or she is the stereotypical "stubborn" old timer.

Aaron

There will be a big spike next month. This bill only delays the inevitable. As more and more people lose their jobs, notices of default (NODs) will go through the roof.

Josh

Focus upon the zip code specific valuation metrics when seeking resilient geographical areas that have little or no exposure to the subprime underwriting methodology. Then a market analysis is performed complimented with the tax record to provide a forensic review of compelling value. This can all be done quite quickly with Realtors that make a market in distressed inventory. We always tell our buyers that it must be a compelling value and the home makes your heart beat faster. Investors and first time homebuyers own this recovery — at a pace that reflects compelling value!

Joe Henry
bankowned@longandfoster.com
(571) 282-8249
Fairfax County/Northern Virginia

Interestingly, it appears that capitalism is starting to work in some areas hardest-hit by foreclosures. (See this post: A Recovering Market without Govt Intervention as well as article in today's LA Times: "Santa Ana leads a bittersweet real estate boomlet.")

In these areas home prices have plummeted thanks to foreclsoures, but the prices have now fallen back to levels that buyers can truly afford and sales are picking up.

This blog is very informative. I am really pleased to post my comment on this blog . It helped me with oceans of knowledge. Good job.

John Beck

Everyone keeps wanting to know when the market bottom is.  This article — Market Bottom? I Think Not — is pretty good!

Chris

I second that Marin County man.

It wasn't too long ago that the economists from the board of realtors clamored that our nation is suffering from a severe shortage of homes.

I have been reading here for a while now and thought it would only be fair to register and contribute instead of being a silent reader. So, I am looking forward to be a full part of the community!

Take care!

ProGasCasMash

Until new administration takes over and makes a bold move, this kind of so called "good news" is the best we can expect!

Very interesting data. Another interesting question would be why voters felt that Obama could do a better job than McCain handling the foreclosure crisis.

Pingback from  Foreclosures and the Presidential Election

Pay attention to the year-over-year data, rather than the noisier monthly data

Pingback from  Real Estate Secret Info  » Blog Archive   » Home Prices: The Trend Is Still Down - ForeclosurePulse Blog …

No doubt the year-over-year data is more telling; however, the month-over-month data can inform as well -- as long as you don't read too much into it.

Pingback from  Best Ad For You  » Blog Archive   » A Recovering Market without Govt Intervention - ForeclosurePulse …

Pingback from  Best Ad For You  » Blog Archive   » Fed Calls Another Running Play at Fourth and Goal …

Pingback from  Best Ad For You  » Blog Archive   » Realtors Optimistic in CA for 2009 so long as??? - ForeclosurePulse …

Pingback from  Safe Real Estate Info  » Blog Archive   » A Recovering Market without Govt Intervention - ForeclosurePulse …

Pingback from  Finest Real Estate Info  » Blog Archive   » Realtors Optimistic in CA for 2009 so long as??? - ForeclosurePulse …

Pingback from  Finest Real Estate Info  » Blog Archive   » Fed Calls Another Running Play at Fourth and Goal …

Pingback from  Finest Real Estate Info  » Blog Archive   » A Recovering Market without Govt Intervention - ForeclosurePulse …

I keep wondering what will happen to the potentially huge nventory of REO properties once the moratorium on foreclosures ends in early January. With mortgage money so difficult to obtain and the huge inventory of property for sale, increased numbers of REO properties will continue to drive prices lower. With the overwhelming majority of REO's being in an'uninhabitable' condition as defined by appraisers because utilities are off or they are in damaged/poor condition, who do they think will buy them? FHA's 203K program is not widely marketed and investors need 20-25% down to get a conventional rehab loan. All this tells me that non REO sellers are in for a very rough time. Price comparisons by prospective buyers online do not take these factors into account.As a result condition becomes everything for a 'market rate' seller. t's going to get worse before it gets better for all the lousy quality product out there. But... a good house in good condition in a good location that's priced right will still sell quickly.

All you fix and flippers out there, get that cash ready.

Pingback from  Safe Real Estate Info  » Blog Archive   » No Quick Fix for Calif. Housing, Economists Predict …

Unfortunately foreclosures and loan modifications are necessary these days.  I suggest you investigate the company offering you any credit related services.  Are the accredited by the Better Business Bureau?  Are their prices reasonable.  Do your leg work and you will be ok.

Whoa, the YoY numbers are astounding. However, the foreclosure Tsunami looks like it may really hit next spring 09. With the holiday moratorium, States tinkering with the laws, and FDIC and other Fed agencies prolonging the pain, this could drag on 12-15 mos longer than it otherwise would have Most projections are 24-29 more mos). See you on the other side.

I just love real estate professionals (pumpers).  

Real estate will continue to fall for some period of time and we have not even come close to seeing the bottom for areas like Southern California.   Once the market bottoms, there will be plenty of inventory and time to get in, because prices are NOT going to rebound quickly.  By the time this is over, even people who bought homes 10 years ago may be underwater.  Is that going to create the environment for another rapid price appreciation.  I think not.

Stay far away from real estate.  Stay far away from any investment that does not generate solid cash flow.

The November drop is expected given the number of banks (and Fannie) that have given those in default a foreclosure 'holiday'.

Expect truly awful numbers in January when the 'holiday' is over and the wave of defaults by Detroit-related people walking away jobless with as much cash as they can preserve.

I find it truly amazing and nauseating that the Republicans gave $700 billion to a bunch of corrupt bankers, but wouldn't give one fortieth (1/40th) that amount to what is left of America's manufacturing infrastructure.

Is this off-topic? Hardly, it will definitely accelerate foreclosures.

Related Blog Entries

I am not so much concerned about this month or the next few as the subprime mess has already hit and it is obvious that there are many homes in trouble.  I am more concerned since reading a report on www.emptypig.com that referenced last night's 60 minutes report.  They mentioned that there are Alt-A and option arms mortgages and that they will be creating defaults in the coming years to the same extent as the subprime mortgage defaults.  What sounds worse is that these aren't just because of subprime candidates but in fact very devious mortgages designed to entice even marginally qualified candidates and qualified candidates.  

And I agree with Dan about the manufacturing infrastructure. We are bailing out the people that created this mess and benefited from it and we are ignoring the very measures that will help us moving forward.

I mostly concur with the comments from Rick, Dan and Todd. There has been some artificial suppression of foreclosures that probably could forestall the road to recovery while possibly saving a relatively small percentage of homeowners who are at risk of foreclosure.

The nasty truth is that home prices really have to come down to a truly affordable level and probably overcorrect a bit and become viewed as undervalued in order to convince most buyers that it's safe to get back into the market. Many stakeholders don't want prices to come down (including toxic option ARM and Alt-A mortgage holders). But affordable, even bargain prices, will create a floor of demand that could help the market better weather the next round of foreclosures -- especially if lenders adjust and become better equipped to respond to short sales or agree to meaningful loan modifications. In a sense the farther prices fall in response to this first wave of foreclosures, the less susceptible the market will be to further price declines when the next wave hits.

Does anyone know what will happen to the foreclosed homes that the Fed intends to buy? Will they still be financed by a bank? And since banks require PMI, why are foreclosures causing so many banks to fail?  

Octavion - Good post, I know a few people already in this position.  If banks ultimately get hosed on defaults what are the chances they will be open to "make a deal" and negotiate a better loan or even forgive part of the principle in order to keep people in their homes and at least receive some continual payments?

This post has good insight. There is no silver bullet on this issue. However, if house prices decrease to 1998 levels, it will bring back affordability. So, in my humble opinion, the price of housing is a big factor in this mess.

In many articles I read, writers usually mention “underwater” homeowners are unable to refinance so they end up in foreclosure. I just don't quite understand why when refinance fails, one has to be foreclosed. When those homeowners bought the house, don't they commit to pay the mortgage for 30 years? If they got teaser rates, don't they already prepare to shoulder the rise in payment when the interest rate rises?

It is understandable that those who lost their job will probably face foreclosure, but I don't think all the foreclosures are caused by job loss or divorce. That leads me to believe many homeowners were gambling that prices would increase forever — and did not even think about their repayment ability. Now, while the government is helping those who suffer job losses or divorce, those who were irresponsible are rewarded as well.

We should let the market works its way through the correction. Those who cannot afford a home, should rent. There’s no shame in renting. There are many homeowners waiting for prices to fall to a reasonable range.

Today, I read a post about a home for sale in the Inland Empire. It is a short sale but the asking price is still at 2005 level. People just don't want to admit the party is over.

Responsible Homeowner

I see a new beginning with the new low rates.  People that are late will refinance using the Streamline Modification Program that the government launched December 15^th.  And people with some equity will be able to refinance.  If the SMP is not an option, there other government mortgages available in the Hope Now Program (www.HopeNowMortgages.com).

Brian,

Thanks for the comments.

I think banks are getting to the point where they are ready to negotiate now. Some lenders have too many foreclosures, so they don't want any more. It's better for lenders to lower the interest rate or modify the terms of the mortgage in order to keep the borrower in the house.

I think we will see a lot of that in 2009.

Octavio

Responsible Homeowner,

Thanks for sharing your thoughts.

I agree with you. We need to bring back affordability to the housing market. In some bubble states — California, Florida, Nevada and Arizona — prices are still too high.

And I agree with you on the point that way too many American homeowners “gambled” on housing, betting the prices would ALWAYS go up.

Finally, I am with you 100 percent on allowing the market to work its way through the correction.

No more bailouts!

Octavio

Talking about bank rework the loan, it is just a joke. A lot of homeowners in default now are not yet seeing the highest interest yet. Helping them to rewrite the loan into a fix rate loan at 6% which may be the same or higher that the teaser rate that they are defaulting now, I doubt many of them can afford it. Government still don't recognize the root of the problem.Many of these defaulting homeowner DO NOT have enough income to support the conventional loan payment. That is the reason they got into the exotic loan at the first place. Unless the bank is willing to decrease the principal as many as 30% or more, by no ways the loan modification will work because by doing so, bank will go bankrupt. Loan modification is just prolonging the inevitable and drags the pain longer, though it may help a few.

I hope we tax payer don't have to hand money to those defaulting homeowner sso they can pay the mortgage, because I need money to pay my mortgage TOO, although I'm still paying on time.

Sigh..

DESPITE SURGING FORECLOSURE RATES, HUGE SAVINGS - MANY BUYERS DON'T WANT THE HEADACHE! Here in Chicago

One way to minimize the financial losses for Lenders is that many today are now modifying “fixed foreclosure rules” in favor of acquiring the property early – by accepting a “deed in lieu” of foreclosure by working with the Creditor, saving up to $40,000+ in legal fees, long waits for legal proceedings to reach a default verdict due to massive court clogging, and listing the properties for sale as a “bank owned property” rather than a foreclosure, thus avoiding the stigma of a foreclosure sale where the bottom feeder buyers are continually knocking down the values “on the cheap” ranging anywhere from 20-85% off the value to acquire a foreclosed property.

Lenders are up to their necks in legal fees with continual mounting foreclosures, and literally drowning in a sea of lawsuits largely due to inflexibility and the standard fixed foreclosure procedures. Creative lenders are finding other methods to solve the situation, and enormous expense.

As the recession deepens in 2009, Lenders are finding the “deed in lieu” a viable alternative to going through the legal process to gain quick access to the property for disposal. However, many Creditors are coming up with creative propositions to the Lender to facilitate the expedited deed, rather than the Creditor remaining in the property for months on end before court decision, and essentially living rent free.

One method is a forgiveness of loan debt, by the Lender, coupled with a promise not to pursue a deficiency judgment, in affidavit format, an exchange which often yields the facilitated “deed in lieu” from the Creditor, who then must vacate the property, usually within 30 days or less, upon acceptance of the deed. Note: Lenders cannot make any deed in lieu offer, due to legal ramifications, which involves the parole evidence rule (meaning the avoidance of coercion). The deed in lieu negotiations must be presented in writing by the Creditor. Then, the negotiations can begin legally. Many Creditors are unaware of this method, yet the Lender is unable to offer that suggestion due to the parole evidence rule. It is the savvy Creditor who investigates all possible resources and makes a formal written offer to the bank, which then in turn, opens the path.

Lenders are finding that early entry of a realtor listing of the property saves upwards of $40-50,000 to the Lender, when other factors such as property maintenance, real estate taxes, HOA fees, insurance etc. are added to the legal costs, by selling the property early.

In news just appearing from Fed. Reserve Chairman Ben Bernanke, who stated last week that the Fed will likely buy up mortgages directly from the Lender, is another quick method of property disposal, by the lender, which the Fed would implement early next year. Many Lenders will be quick to take advantage of that kind of offer, which has best bets for lower discounts on the buyouts of the mortgages, rather than waiting as time goes by wherein the Fed will be continually offering a lesser percentage as they accumulate untold properties into the hundreds of thousands, or millions.

Such a method can be attractive to a Creditor as well, who would preserve whatever credit standing with the credit reporting agencies, nor have to be concerned with any possible deficiency judgments that could follow a foreclosure decision, once the property is sold... This presents a win-win situation for both Lender and Creditor. Although some Creditors may not make this offer, and would rather just remain in the property rent free to save up on money to later move into an apartment. The tilt is more in the bank’s favor, as the Creditor would be vacating the property within 2-4 weeks once the deal is agreed upon.

There is a waiting period in many states, already exceeding a year before having the action brought before the judge. As time goes by next year, this waiting period is expected to become even longer as foreclosures mount, and particularly in mid-January and beyond, when many ARM’s reset to higher monthly payments for millions more homeowners with mortgages.

Among the hardest hit foreclosure states in ratios of mortgages held to foreclosures: Florida, 30.7%, California 30.3%, Nevada 29.7%. Followed next by Michigan, Ohio, and Illinois. This also translates to much longer court dates for disposition of the foreclosure.

Meanwhile, several economists are stating that some 800-1000 U.S. banks will fail due to these overwhelming foreclosures next year. Already in 2008, some 311 banks have imploded, or been taken over by larger banks.

Many are attempting to secure funds from the Congressional “bail out funds” which already has surpassed the initial $700 billion, and is now approaching $1.2 trillion.

In the past two days, several money organizations are also lining up to be declared a “bank holding company,” among them American Express, and GMAC Financial Corp. More are expected in the coming days and weeks ahead. This will put a tighter squeeze on the bail out funds available.

"Recovery"?  Hardly.  Just some "free-wheeling capitalists" (the same types who caused the current problems) cashing in on comparatively cheap land in a still-desirable district. (The govt. is one of the largest local employers now, and will in future be even bigger.)

THanks for offering this information. Very infomative.I look forward to sharing it with others within my agency.

The bail out is a giant scam, with the fault lying with the banks making bad decisions, predatory lending, subprime lending, etc.They should bear the brunt of what they made happen,and get some of those billions they have given out for golden parachutes, and outrageous bonuses,  returned by the beneficiaries.

Foreclosures in November did NOT go down.

November simply had less business days in it.   Please, count the number of business days in both October and November.  Add the foreclosures for both months together and then divide.

You'll find that the "per business day" foreclosure rate was virtually the same for both October and November.  RealtyTrac either doesn't understand their own data, or they're too lazy to analyze.

Thanks for the good post.

Johnny

In my local area, the legal system — both the courts and the foreclosure attorneys — are getting bogged down and backed up. They have been running over capacity and seem to have hit a wall.

Working with new REO assignments (foreclosed properties in preparation for sale) I had noticed a higher percentage of "incomplete" legal actions when checking the status of my assignments. My inquiries to the foreclosure attorneys revealed invariably that their offices were running way behind on processing.  

New cases are slow to get started when the attorney's offices and courts are taking as long as six to eight weeks to get court approval of the “Special Masters Report and Sale,” from the actual sale on the courthouse steps. It used to be uncommon for that process to take more than a week or two.

Matt Peters

The lenders are not helping fast enough. Lenders should impose a freeze on all foreclosures for at least 90 days. You can't refinance because homes aren’t appraising.  I sell real estate for a living and this is awful.

Ingrid Jackson

Pingback from  Negativity Equity: Reading the Foreclosure Writing on the Wall | Foreclosure Living

What's the reason that median list price is compared to median REO price?

For example, In PA there can be 10,000 homes considered for median list price. But there can be only 100 REO owned homes. May be these 100 homes are with marked price less than $100,000.

I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.

Susan

www.car-insurance-choices.com

I think that President-elect Obama should free up our 401-K's by 20 percent.

Frank Smith

Pingback from  Auto Industry Bailout  » Blog Archive  » News For Jan. 9, 2009 - Foreclosure Community and Blog Resource …

Short Sale v. Foreclosure

The Wall Street Journal says they are about equal in waiting time. I agree with that, however, there is a difference.  A large number of the foreclosure properties come to the market in the Los Angeles area damaged, while short sale properties are in a lot better condition. There use to be a problem with the agents doing the BPOs for the properties of short sales who were inflating the properties values. This was done so agents could later get the properties as their foreclosure listings. Since January 1, 2009, they will be penalized so I think that will stop happening.

Shelley Gross

Shelley,

That's an interesting point.

Octavio

Fairfax County has 369 bank-owned properties and 1,069 short sales that are active inventory as of January 16, 2009.

The variety and quality of the distressed inventory is compelling and we are seeing well funded buyers simply waiting anywhere from three to six months for a specific defendable value.

The banks are now in a triage mode. It is truly difficult to determine fair market value as the distressed portfolios grow to a volume that jeopardizes all sectors of the real estate market from studio/condos to luxury homes. We are seeing new $3.6 million dollar homes being sold (bank-owned) for $2 million and we are also seeing the investors flipping 3BD/2BA bank-owned condos for a gain of 60 to 80 percent within several months.

We see a liquidity based recovery with the deep end of the funding pool called FHA and the very shallow end of the pool called JUMBO. Our housing sector needs a simple collar around a fundamental underwriting discipline. The borrower must not be allowed to determine the value of the collateral. Until then, I have some excellent deals for you in all price ranges — and please bring a flash light since the bank has winterized the property!

Joe Henry

REALTOR

bankowned@longandfoster.com

(571) 282-8249          

Joe,

That's amazing!

Thanks for the Fairfax County, Va. update.

Octavio

Thanks, Joe, that's very helpful information.  I wonder, are those investors adding value to their properties before reselling them?  I'd sure like to know which zip codes they're finding those condos.

I'll keep visiting this website in the future, for sure.

Karen M.

I was just thinking about Burning Down the House —  and you've really helped out. Thanks!

Raymond Kirk

"The borrower must not be allowed to determine the value of the collateral."

Isn't the borrower, the buyer?  Are you saying buyers should not decide what they want to pay for something?  

Steven Scharf

SCSMedia@aol.com

My husband and I are interested in purchasing foreclosure and tax lien properties in the upstate, capital region area.  

Eileen LaSpaluto

Well, good thing the government has printed or taken so much money from us all to address the foreclosure crisis, and good for the banks for participating in these voluntary government programs. With leadership like this in addressing the foreclosure rate, how can we not trust the government to get us out of the second Great Depression?

Nick

I have a Chase second mortgage and a Citi first mortgage. I bought a $465,000 home in early 2004, with 1,548 square feet of living space in the 91354 zip code.

I was ill in 2006, and out of work, due to the wonderful lending practices I was able to obtain 2nd mortgage so I could pay my bills during my illness six months off work.

The value of my home was $620,000 in 2006, (BUBBLE value). My wife was later laid of mortgage from the mortgage industry, and is making 1/3 of what she used to make.

My bonus was taken away — that was a 1/8 of my annual salary. So my credit card debt is high, and I’m no longer able to make my minimum payment and my mortgages.

So I called Chase to discuss the situation. I went to a recording after I was transferred around for an hour. No phone call, no letter responding to message. I sent a certified mail letter with return receipt with a LOE, income documentation, copy of all bills, assets, etc., begging for some assistance, relief etc.

NO RESPONSE.

I paid half of my second mortgage payment. Chase called asking what was wrong. I started to explain the situation, requesting accommodation of any sort.

I WAS INFORMED THAT THEY CAN’T DO ANYTHING UNLESS THE FIRST MORTGAGE AGREES TO DO SOMETHING!

I am $150,000 + upside down. Chase provided a ridiculous value back to 2006. No comparables exist in 2006 with a $620,000 value within a 5-miles radius. It sounds PREDATORY to me. If they don’t want to help, then they can try to foreclose and assume the first mortgage.

I THINK THEY WOULDN’T DO. FOR ALL I CARE, THEY CAN TAKE THIS $4,000-A-MONTH, 1,500 SQUARE FOOT OVERPRICED STRUCTURE, AND RESELL IT FOR REPLACEMENT COST WHICH IS WHAT IT’S WORTH NOW.

HOME OWNER, BUBBLE VICTIM, GETTING PUSHED INTO WALKING AWAY

Prince William County, Virginia, Update 1/24/2009

Copyright (C) Deanna & Jim's GOLD Team, RE/MAX Olympic Realty

REO Activity in PW County, City of Manassas, City of Manassas Park

12/24/2008-1/23/2009 - Current Month

New Listings     Contracts      SOLD   Days on Mkt    Avg Price

175                       555             703      118                  $176K

11/24/2008-12/23/2008 - Month back

242                       577             806      112                  $182K

12/24/2007-1/23/2008 - Year back

144                       384             517      125                  $189K

Although up substantially from the same 31 day period in 2007-2008 volume this period (which included both Christmas and New Year holidays) has declined somewhat from the preceding 30-day period (which included the Thanksgiving holiday).  Buyer opportunities abound at much reduced prices.

Prince William County continues to be the hardest hit county in the Commonwealth of Virginia. It provides outstanding current value opportunities for (1) buyers previously priced out of the market, (2) investors looking a purchase properties with immediate positive cash flow, (3) buyers who bought BEFORE 2004 and did NOT refinance and need to move up.

Deanna & Jim's GOLD Team has handled aver 140 REO transactions in greater PW County area in the last 12 months.  Our 3-person team has over 21 years of licensed experience, an MBA, an MS in computers and an MA in psychology. We have handled over 350 transactions in the last 8 years. We are experts on REOs, short sales, resales, and purchases of residential real estate in Prince William County and surrounding areas of Fairfax, Loudoun, Stafford, and Faquier Counties.  

(All data from MRIS. Data believed accurate but should not be

relied upon without verification.)

I’m having a hard time finding information on an auction property that I want to buy.  

I have bought a house at auction before and it was a piece of cake — this one is ridiculous!  

Does anyone know of anything else you can do to research a property after you have checked the deed, contacted the town and county —  neither knew anything?

The auction was postponed, the attorneys’ office wouldn’t say anything except: "We don't know anything."  

If there are so many foreclosures out there why doesn't someone come up with an easier way to buy them?  

The owner trashed the house and moved out, bought another house and now that has been foreclosed on.  

Any information would be great!

Thank you!

Patti

Pattie,

Here are some possible scenarios of what might be going on with the auction property you are pursuing:

1) The borrower (homeowner) paid up the loan balance that was in arrears.

2) The borrower (homeowner) is negotiating a re-payment plan (loan modification) with the lender.

3) The lender went bankrupt (i.e., Bear Sterns, Leman Brothers, IndyMac and others), causing delays in the auction process.

4) The lender is overwhelmed with hundred or thousands of foreclosure auctions.

These are just a few options that come to mind.

Octavio

Brian,

Now I can see why some homeowners are ready to walk away from their mortgages.

I'm sure you're not the only borrower getting "pushed" into walking.

Good luck to you.

Octavio

Last year, the major stock indexes plunged in value as the economy was yanked back and forth by conflicting forces. On one end of the rope were the aggressive intervention efforts of the government; on the other end an accelerating financial crisis the likes of which hadn't been seen since the Great Depression. The Dow Jones Industrial Average dropped 34% in 2008, the S&P 500 slid 38% and the Nasdaq Composite shed 41% of its value, frustrating hopes that a year-end rally would pull investor fortunes in the right direction.

Lovely. Great site.

I will keep it short — as tomorrow another 1,000+ or so homes will pass into foreclosure.

The October 2008 Federal “Hope for Homeowners” program is a JOKE. Since October 1, 2008, they have taken less than 400 applications. How many of those “applications” were processed?

In the five months since the Federal government gave such “Hope” to the American people well over 600 homes have entered foreclosure — IN DETROIT ALONE!

Don’t be a fooled and wait for big government to save you.

Let me ask you — do you have 7 minutes to save your home?

I agree with you "7 minutes."

Big government is not the solution to the foreclosure crisis.

Hi,

Thanks for sharing.

Stella F.

I read an article that is absolutely right, and that is not to buy in 2009.  If you are interested in seeing why you can see the article here.

www.gotoguy.com/.../worst-behind-us-most-likely-no

It's interesting some of the stuff on the site.  They are very smart when it comes to the markets and economy.

Best,

That's a whole lot of foreclosures. It looked like the foreclosure numbers were going down, but now with the economy in recession, it may be going up for different reasons.

Philly

Pingback from  Boomer’s Blog  » Blog Archive   » Real Estate Investor Alert: Ghost Inventory in the REO Machine Haunts U.S. Housing Markets

That's so much money, it's not even money anymore. It's just numbers....

Houston

The amount of foreclosures in Detroit, Mich., is unbelievable

You would need a day just to shred all the papers.

Click here and watch the video about Detroit foreclosures.

Chris

What is being planned for all the foreclosed homes shown in many zip codes in San Antonio, Texas and elsewhere?

The banks apparently own the homes. So, are there plans for the banks to purchase the homes with recovery money and resale them at a fair price?  It seems as if most of the solutions are geared toward keeping those who about to go into foreclosure from doing so by offering various solutions.

It is simply mind-boggling and incredible.  

Joyce E. Hornbeak

Good news indeed. I am happy to hear that Fannie is revising investor guidelines.

Investors boost the economy no need to penalize us.

Chiconya

I just hope that this stimulus package is not yet too late.

Loan Modification

Pingback from  Pages tagged "surprising"

Great blog.  This blog has very useful, workable and relevant information.  

Shazia

WOW! This is the sign of the times. Give the poor souls a break. The government should give them free housing.

Tom Sachdeva

Who are we joking? Do you really think the banks will lower the interest rates and monthly payments that easily? The home owners will have to fight an uphill battle just to get those discounts passed on to them. Banks will not lower the rates as it causes a worry for their own existence.  So are they going to care for a homeowner’s existence?

Tom Sachdeva

What an absurd statement?

This woman chose to have 16 children with no obvious means of support, and you think that she should be rewarded for her irresponsibility with free housing?

So, I guess I should just start having illegitimate kids — no job, no money and let the government support me too?

Give me a break!

Chris

In most cases, the homes will be immediately put back on the market, taking into consideration evictions and clean up. Most homes are in the market within 15-30 days and reside on the market until auction or approximately 90 to 120 days before an offer is submitted.

I work for a major bank, and I currently manage more than 15,000 properties on the market through foreclosure. The cycle runs every 120 days, so I never see a pipeline below 15,000 homes  

Brian

Well, it looks like the latest stimulus plan will be officially passed any day now.

Although I’m not sure that they are aware of it, taxpayers have already paid $250-billion towards the previously passed stimulus plan.

Thanks for the information.

Mark Marden

Mark,

Come back daily. We update this information every day.

The current housing market is out of control.

Tomek

I’m looking for a nice home that is safe and in a country setting. We are a family of three.  We have two family pets that are very well trained. I would like to find something in south central Ky. Please respond. We are first-time home buyers. Thank You.

Vickie Stewart

They seem to be very protective of both parties.

Vickie Stewart

Where is Barney Franks name?

It should be at the top of the list!

Alexander Sabo

YES , WHERE IS  BARNEY FRANK,  WATERS AND MEEKS NAMES? THESE POLITICIANS ARE STILL IN CONTROL. ALONG WITH THEIR COHORT RAINES DESIGNED THIS CATASTROPHE. YET THEY GO ALONG WITH NO BLAME OR CHARGES BY THE IGNORANT PUBLIC.

The absorption rate of the distressed inventory in Fairfax County Virginia is accelerating and there are only 269 bank-owned properties available, which is a significant reduction from a high of 489 in November of 2008.

The investors are defining the bottom of the market from a valuation standpoint and the banks are clearly developing an efficient method utilizing third party bank asset managers to liquidate portfolios of non-performing assets. The added liquidity will allow for a sustainable recovery of defendable value...the real estate sector will recover...at the right price!  

Indeed, we have been in contact with private sector equity participants...the investor portfolios define the bottom and we are seeing these participants moving quickly to capture compelling value in all price ranges!

Joe Henry

Realtor

Long and Foster

McLean, Va.

Cel. (571) 282-8249

bankowned@longandfoster.com

I am an investor and I have a very nice property for sale in West Virginia.

If you are interested please send me an e-mail and I will be happy to e-mail you back some pictures of the property and detailed information.

William Wade

wade106@yahoo.com

Hi,

It is such a useful article and I found a lot of information with the help of this article. Thank you so much for sharing.

Stella

[url=www.drug-intervention.com/plan-b.html]Drug Intervention[/url]

<a href=www.drug-intervention.com/plan-b.html>Drug Intervention</a>

I found this to be very interesting information.

I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.

Sarah

www.craigslistdecoded.info

If the house prices kept going up, then the profit would have been for the buyer (spender) to keep. Since they are going down instead, the loss will be passed on to the lender (saver). When a precedent is set that a bankruptcy judge can override mutual agreements and arbitrarily punish the lender (saver) to benefit the borrower (spender) just to please the politicians, it is quite predictable that savers will stop lending their money. This is just another example of the Congress being unable to see beyond the tip of its nose, thereby adding more fuel to the fire.

Dave

I’m a new investor. I would love to purchase 10 investment properties, but don’t have the capital to do so. If I could get financed through Fannie Mae to purchase these additional 10 properties, I would be very grateful. I can leave the borrowers in their homes or sell it back to them for a lower price. Fannie Mae wins, I win — and the homeowners win everyone is happy!

Todd Jackson

I need to find the portfolio banks that can loan more than 10 houses on their books. Can somebody aware such portfolio banks. Please let us know by posting such information on website..  

What are the banks that loan more than 10 houses? Please share the information.

Great news for the market! Investors are back in the game. Thanks Fannie Mae. I live in a college town and work with investors that purchase many college rentals. They have been hampered by the recent credit crunch. Let's hope this helps stabilize the market.

Gary Kalligher

Broker

RE/MAX1

Duluth, MN.

218-390-0615

For several years, loose underwriting guidelines allowed people to buy or refinance homes who should have been declined for a mortgage. Now that most lenders have returned to traditional underwriting, it's going to take some time to clear out the inventory of distressed homes, based on market demand, which is driven by qualified borrowers. As home prices fall and potential mortgage payments become closer to the cost of renting a similar home, there's more incentive to buy, rather than rent, which should increase demand.

Hi Gary,

That's very interesting. I'd like to speak with you about your investor clients and how the new Fannie Mae rule change is sparking investor interest.

Octavio Nuiry

Staff Writer, Marketing Department

RealtyTrac Inc.

One Venture Plaza, Suite 300

Irvine, CA 92618

949.502.8300, ext. 250

octavio.nuiry@realtytrac.com

The USA government is clearly pouring money into the economy in a unprecedented scale. So how is that working out for us thus far? This morning the overall stock market officially pierced the previous lows of last November. The S&P 500 (a market-weighted index of the largest 500 companies in the nation) had its worst opening two months for a calendar year ever (depression era included). The index is actually at a lower level than it was at the end of Clinton’s first term twelve years ago!

--------------------------------------------------------

Fischer Christy

I need to find the portfolio banks that can loan more than 10 houses on their books.

Can somebody who knows about these portfolio banks please let us know by posting such information on website?

Norma Jeane

Pingback from  Topics about Banking  » Banks burdened as Washington foreclosure auctions slow

I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.

Joannah

I am hoping that my lien holder will be given some Federal help to assist people like myself who have missed a payment on their mortgages. My lien holder is American General & Finance, which is part of AIG, so I am wondering if they will be receiving funding to assist me.  I was laid off and only missed my March payment.  I am 70 years old — I really need assistance.

Thank you!

Phylllis Sobers

I live in the San Francisco Bay area.  There are tons of bank-owned homes and I have $200,000 in cash and I want to buy a home out right.

I have read that 50 cents in the dollar is where to start. Is that true?

Kim

Pingback from  Topics about Movies  » Archive   » Fed Takes Foreclosure Ads to the Movies - Foreclosure community …

Two comments.

Michigan has a bad reputation with investors from outside the state.

FHA continues to keep the long ownership seasoning schedule in place while the properties pile up.

Robert Urban

Remember all Real Estate is local there are communites in Orange County and San Diego County California which are showing increase in price.  Some select homes in Los Angeles are attracting multiple buyers and quick liisting turn arounds.  Buyers do well to get accurante market pricing from local REALTORS.

I wonder when we will see a slow down in foreclosure activity not due to the government involvement, but due to the number of unaffordable homes being "wiped out."

Susan

It is terrible that the con men of the world have moved on to take a bite out of foreclosure victims. My site is about helping to make sure you can find out how to stop foreclosure. I suggest you check it out if you are still trying to avoid foreclosure. All info no scams

It is good to see that Hope Now is working to help those in serious risk of losing their homes. This is what I do too trying to help people save themselves from the disaster of losing their homes. Which to me is only a good thing!

William J. Maschke

http://www.endproperty.com

Pingback from  Squatters settle in foreclosures, landlords are not feeling the love | Foreclosures For Profit

Pingback from  Squatters settle in foreclosures, landlords are not feeling the love | Foreclosures For Profit

This is definitely not a flipping market as we are seeing here in Las Vegas as well as many other parts of the Country.  With all of the foreclosures in Las Vegas there are tremendous opportunities for first time home buyers.  Buy on bad news and sell on the good.  The Greater Las Vegas Association of Realtors is reporting increasing sales statistics in both February and March 2009 so I agree that buyers will seek out accurate market pricing which is evident in our sales figures.

View Full Report.link is broken

We saw more filings in March than we have all year in Washtenaw County, Michigan - the banks delay waas evident.

The View Full Report link now should be working. Sorry about that.

Data in the tables for March and 1Q2009 appear wrong??  Also the data for the March table is the completely the same as data for the 1Q2009 table?

The data being imprted still looks incorrect re comments Q1 and March data imports are the same??!!

The tables in the full report will be corrected shortly.

Those two tables on "View Full Report" page don't make sense.

1) they both have the same numbers in them

2) last two columns don't say realtive to what the change is recorded.

3) looks like data in tables doesn't match the text - California saw "foreclosure activity increased 35 percent from the previous quarter and 36 percent from Q1 2008" - I can't find such info in tables

The tables in the full report are now correct. Sorry again. Let me know if you have any questions.

And just to clarify. The text in the report was always correct. It was the tables at the bottom that were incorrect.

Great news, but have any lenders adopted this in their internal guidlines?

The distressed inventory(Bank Owned/Short Sales) is illustrating excellent value in Northern Virginia and we are seeing multiple offers on all Bank Owned property.

Cash Offers within 50% of Fair Market Value provide the most traction and banks are efficiently clearing title issues to expedite ratification and closing schedules.  The Bank Offers must be designed  specifically for counter offer traction and adjusting the closing schedule is normally resulting in added negotiating/price leverage.Our clients are investing the time required to allow our due diligence to reveal compelling value...we tell our client base that the home needs to make your heart beat faster at a compelling value...then we write a defendable offer with room for counter offer traction...Bank Funding Letter...30 Day Close....Buy AS IS...stay flexible with closing/title groups!

Joe Henry

Keller Williams

bankowned@mris.com

(571) 282-8249

24/7

Where are we at now?  How many total foreclosures in the US?

There were more than 800,000 properties with foreclosure filings in the first quarter of 2008, which puts us on track for more than 3 million properties with foreclosure filings in 2009.

View latest report.

Pingback from  Real Estate/Buisness News  » Blog Archive   » The Coming Debacle in Commercial Real Estate - Foreclosure …

I have a Countrywide home loan and can not get them to work out a modification to lower my payments. They have sent me a notice that they will forclose on my home in 60-90 days. What can I do to stop this forclosure? They say I have qualified for a program after the fact that I am now four months behind, but they still have not contacted me or my HUD counselor.

I have been working with my local bank since Nov. 2008. They keep applying me for different loans — to re-do my existing loan — but I keep being denied because of my income.  Well, that's why I need help. My Income has decreased by almost 50 percent since a year ago. So I need help keeping my home, but I just keep getting the run around. Can you help me? Thank you!

Kimberly Neale

I have a Freddie Mac loan through Citi Mortgage. I was just told by a loss mitigation counselor that they will not work with me on a loan modification unless I had a job, and I had to be earning a reasonable salary that would support the cost of the home (i.e., $10/hour doesn't qualify).

Meanwhile, I can make partial payments until someone arbitrarily decides to move forward with foreclosure proceedings. The counselor could not give me a timeframe on how long I had before this happened or an amount I could pay that would slow the process.  

HELP!  

Where is the HELP? I'm not experiencing it!

Gone Fishing

Are you guys releasing the "1 in every" foreclosure data for March?

Mike

Hi! I enjoyed reading your post. I’ve been looking around for such material as I maintain my own blog on real estate. I’ll be waiting for the updates.

John Beck

If banks would consider tearing down more troubled REO's, maybe this market would stabilize sooner.  Many of these are in bad areas, and just need revitalization. A vacant lot is better for a neighborhood than a vacant home in my opinion.  Yes, the bank may have a greater loss, but they could make up the loss quicker with new loans as the market recovers quicker when there is less inventory. It’s simple supply and demand economics.

Winston Salem Real Estate

I hope the Senate will consider prioritizing the real hardships — like sickness.

Because of the volume facing the loss mitigation departments, the real hardships that had nothing to do with the economy are not getting urgent attention they deserve.

Brenda Rossberg

Pingback from  Topics about Foreclosures  » Archive   » Foreclosure Looms for McAfee Mansion in Colorado Springs

Buying real estate bargain properties can be a great way to make a large profit. If you take the time to do your research and select the property carefully, you can make a great deal of money.

I personally believe that foreclosure sharks could find themselves either under water or with no one to sell to. I think that they have underestimated the effect an L shaped recovery will have. It will not give us house appreciation any time soon.

Gary Anderson

Peter Bergamini's house will lose serious value. So he may as well let it go. Banks have abused us with liar loans and now it is time for this guy to liberate himself. There is no point in living paycheck to paycheck in an overpriced house.

Gary Anderson

The moratorium was a scam of sorts to get money back into the stock market. Had foreclosures been spiking there may not have been a bogus rally like the one we saw in March and April. But the banks will see foreclosures overwhelm them. The party is just starting for these greedy banks who planned this off balance sheet scam at Basel 2 in 1998. They will get what they deserve, massive walking away from loans, mortgages, commercial and credit card debt.

Gary Anderson

I was reading somewhere that there are over 300,000 new foreclosures every month! That is massive. When you put it into perspective with the current population it still is a figure that is way too high.

That's great. I never thought about stately Prince George's County property discounted $221,000 like that before.

Raymond Kirk

This $75,000 cap is preventing me from making a purchase. I make 100,000, but live in Los Angeles, Calif. The cap makes zero sense and is stupid, skewed, and unfair to those who live where the cost of living is FAR higher than other areas. Why doesn't Washington get that if they change these rules they COULD kick start the housing market again? The devil is in the details.

"Duncan points out that it will only be when the foreclosure moratoria are lifted that we will truly see if the economy has been bouncing along the bottom or not."

 I thought the moratorium had been lifted months ago? Or has there been more than one?

I think that home foreclosures are getting out of control across the nation.  I also do not feel that the banks are providing the help that they are suppose to be.  The government has issued banks a huge bail out to prevent these foreclosures and I just feel like the banks are almost more stingy with their money now.  

People need to start being aware of alternatives to foreclosures and dealing with their bank.  There are several alternatives to get a good loan modification to lower your monthly payment.  I would suggest going through a company that has an on staff attorney who is experienced in the field of loan modifications.  There are also many online sites that can help lower your monthly payment and help you prevent a foreclosure.  My friend just went through www.Carrotpeel.com for his loan modification and he thought it was excellent service and results.  

Whatever you choose to do make sure they are helping you prevent foreclosure and that they are helping you personally.

Good Luck, John

The only movement in the market is the increase in first-time homebuyers due to the $8,000 federal tax credit.

Good thing housing is becoming more affordable due to REO's and short sales, creating a new market of homebuyers.

Chico

Well written article, but I strongly disagree about your assertion that the Obama Plan (HAR and HAM) are doing anything to help people. Less than 25 percent of submissions under the HAM are accepted, and of those the vast majority of successful cases are done with the help of an attorney.

The HAR is completely impotent, largely due to the 105 percent Loan-To-Value requirement. It is common knowledge that a large majority of the homeowners in trouble are upside down.

The government would step out of the assistance business altogether, and allow the market to correct itself. It would be painful, but worth it. There is still traditional loss mitigation (and I concede that it is a troubled industry with all of the fraud). But with a reputable law firm many homeowners are getting the help they need.

Onofrio Pentolino

How does any of this foreclosure activity make any sense?

Banks based on personal experience are unwilling to deal with borrowers who are not in default and  of those who are are typically unwilling to give more than a 10% reduction in mortgage payments.  When the work-out fails and the foreclosure process begins banks must wait substantial periods of time before they can take ownership of the property.  And this is only true if the  defendants don't have counsel.  If they do it will likely take longer and/or  they will  not get the property at  all.

When they do sell the property I understand that banks are getting perhaps 20% of the original value of the house.

What makes this worse is that a lot of buyers are walking away because the house is upisde down.

It seems that what is wrong with this  is the neoliberal proposition that these matters are private and the equally narrow view that these are problems of individuals rather than a macro-economic problem.  This is  a public problem with macro-economic impact, it needs a public solution and a systematic solution.

The predatory approach of simply swooping in to get houses at firesale prices achieves "savings"  at the expense of  many homeowners loosing all their dreams. I realize the stereotype of  the homeowner in foreclosure is someone who borrowed for $3000 a month when they only make $2000.  But  these kinds of caricatures get in the way of the larger problem.   Thousands of  responsible  people got screwed because houses which were valued at  500,000 is now worth half that.  They had no way to foresee that.  The  bank didn't.  And Greenspan didn't.  He said, "there is no bubble. We don't have bubbles in real estate."

We need to move away from  hidebound assumptions of  the borrower is a bum, that this national disaster is a private problem, or that we can afford to simply let the courts handle it on a case by case basis.

The housing crisis is like a flood, it is polluting the economy with people who are loosing jobes because of dislocation, it is sinking whole industries which depend on real estate sales,  it is  devaluing whole communities.  Until we fix this hole in the levy- the flood of foreclosures- saving a few drowning  Wall Street bankers won't help.  Let me see if  I can say this plainly- the housing crisis is driving the recession.  It  is the hole in the levy.   We fail  to  deal with this  at  our peril.

See Bailouts, Bubbles, and the Social  Construction of Economic Crisis on

SSRN  

I am retired and my home is in foreclosure.and I am losing the investment I made in it as well as my real estate portfolder I was relying on as a source of income to pay my mortgage. My loan balance is more than the current value of my home.

I do not qualify for the regular loan modification programs because of my income but I do qualify for a Reverse mortgage that will produce more to the bank than the bank will net through a foreclosure but my bank refuses to work with me after ten months of negotiating mostly with myself because you can't reach then on the phone or by letter. They say that they don't do that. Do what? They do not do what they call Short refinance that could keep me in my home but they do do short sales that makes me homeles. Great thinking eh! And it is more costly to do that.

With all the different initiatives and programs that have been developed in regards to foreclosure preventative guidance there are significant challenges in preserving homeownership and assisting those who unfortunately do not qualify. Critics have argued that the case-by-case loan modification method is ineffective, with too few homeowners are assisted relative to the number of foreclosures and with nearly 40 percent of those assisted homeowners again becoming delinquent within 8 months.

In December 2008, the U.S. FDIC reported that more than half of mortgages modified during the first half of 2008 were delinquent again, in many cases because payments were not reduced or mortgage debt was not forgiven. This is further evidence that case-by-case loan modification is not effective as a policy tool. Even despite the increased funding and the growing number of foreclosure assistance professionals in local community’s challenges exist on many levels.

NeighborWorks says counselors continue to report that the most common challenge they encounter when trying to save a homeowner from foreclosure is obtaining a timely response from servicing companies, with 17 percent typically waiting between 45 and 60 days for servicing to reply. And seven percent of foreclosure advisors said servicing companies were generally uncooperative when contacted.

Having understood the real estate and real estate finance industries were going to collapse, I spent years establishing and developing relationships with all of the servicing, sub-servicing and investor companies. Realizing that default management was ultimately the area within the banks that I needed to be connected, I focused my time and energy in building relationships with executive and senior management.

Being strategically positioned and well connected while having the knowledge and experienced we have been offering a new Home Retention Product: Short Pay-off Refinance, or SHORT REFI. A new creative loss mitigation strategy under Default Management we have successfully closed and funded a variety of SHORT PAY-Off REFI's.

To understand what a Short Pay-off Refinance (Herein After referred to as "Short Refi") is.

A short refi is realized when a borrower(s) try to refinance but the loan is SHORT to close. This occurs when the total payoff for the first mortgage lien or the first and second mortgage liens can not be PAID IN FULL.

When the new loan for the refinance does not allow for a full payoff of the first and/or second mortgage liens the borrower has to apply for a Short Payoff with their current mortgage servicing, sub-servicing company or lender. Although many people will say you MUST be late that is a myth however there are variables that play into being successful in achieving an approval for a SHORT PAYOFF.

There are two types of Short Refi's.

1) Short refi's for NON deliquent Borrowers via FHA 203B.

2) Short refi's for DELIQUENT borrowers via the Hope for Homeowners FHA loan Program.

Now many people will say: "The Hope for Homeowners program is not available and we have called several companies on the Participating List of brokers and no one could help."

One of the many issues with the way the program was introduced was that it did not mention that the FHA lender had to have a FULL EAGLE, have its own Ginnie Mae mortgage back securities issuer approval and the investors to purchase these securities.

So as it works there are two processes that take place in the short refinance:

1) The origination of the new mortgage loan.

2) The submission/request for a short pay to LOSS MITIGATION- "The mitigation process."

Now with that being said, A Mortgage Banker's and Mortgage Broker's role is primarily to focus on generating business or ORIGINATING mortgage loans (business). Obviously they will have a processor and support staff that handles their flow of business. But with a SHORT REFI how is the Short Pay-Off approval to be produced or Realized?

It is a fact and can be demonstrated that Mortgage originators, whether it be mortgage bankers or brokers or any support staff (openers, processors, underwriters, clearance officers, closers, Post Closing Staff), will have the:

1) Knowledge of Default Management as an industry;

2) The differences in Default management/operations within the different servicing, sub servicing and investor companies;

3) The experience;

4) The know how- what is required to apply, the process flow, realized time frames...etc and as it has been experienced one of the more important;

5) RELATIONSHIPS.

We work in an industry that revolves around relationships. If you do not feel this way than you may lack that quality in your business model and as a result overall success.

The majority of the mortgage originating industry, whether it is retail or third party mortgage brokers, have thrown these types of deals to the garbage as anyone would think “these do not qualify; how could they?”

Some late on the mortgage, not enough equity to refinance and pay the mortgage lien(s) off in FULL, DTI to high, low fico score. This is known as FALL OUT.

Now there is a percentage of this FALL OUT that can be realized INCOME.

If you are interested in learning more about the two processes that must work in synergy — 1) origination 2) mitigation of current mortgage loan — then please do not hesitate to reach out to me. Whether I can assist you in closing deals that have been stagnant in your pipeline, reach out to executive management if you have yet to be successful on certain short pay-off approvals or if you would like a company with both formal and informal working relationships with the servicing, sub-servicing and investor companies than I would be pleased to further succeed with my mission — Distressed Asset Resolution.

Charles O. Sanchis

President

Distressed Asset Resolution

Subsidiary of C.O.S. Holding, Inc-

153 E. 32nd Street

New York, NY 10016

Like other people on these blogs I am being threatened with foreclosure. It has been hell trying to get Citi Mortgage to budge on anything but full payment with penalties. I may lose my house but I have one ace in the hole.

My mortgage is an ATM, and a few years ago when it was time for the first adjustment, they did not do the calculation correctly. I did not catch their mistake and for a year I overpaid several thousand dollars in higher interest. They did the same thing the second year but I got curious and began asking questions. They tried to deny the problem, but eventually corrected their errors. I doubt that I am the only person this has happened to, but I'm sure Citi has not voluntarily gone back and corrected the mistakes for other people.  

If you had an ARM with Citi at any time in the past 10 years, you may have been overcharged just like me. If you will contact me at armcalc@gmail.com, I will share the details of my experience with you. You might be able to get a big refund. You have nothing to lose by asking.

John

The broad based acceleration of inflation combined with the erosion of homeowner equity may jeopardize the effectiveness of loss mitigation strategies being deployed in the housing market. The time has come to closely monitor the most effective loss mitigation centers and deploy proven models with subtle geographical variations for optimum effectiveness.

All loss mitigation scenarios need to accommodate for an inflation component. True crisis management suggests that protecting the strong homeowner mitigates collateral damage and this is apparent as we see wide spread variations in zip code specific valuation resilience.  

The Obama Administration should consider doing the following:

·        Doubling the first-time homebuyer credit to $16,000 for six months.

·        Allow for investors to participate in the first-time homebuyer credit with a minimum of 20 percent down payment.

·        Identify the state specific homeowner programs that are performing well.

·        Continue to add liquidity and with forensic/perpetual due diligence at the forefront of every underwriting model for the next generation of homeowners that are rewarded with this standard of care.

This is the bottom of fourth inning!

Joe Henry

Keller Williams/McLean

bankowned@mris.com

Well, we can see where all the rich investors live...Vermont.

Foreclosure....just another word for THEFT!

That’s right. We’re in the fourth inning. The prices are false bottoming in some states and still free falling in most.

I love it when the government brings out the punch bowl, and now puts the bowl within the reach of the middle class. Enough with helping out the government’s mega billionaire friends, i.e., — Goldman Sachs, Citi and others.  

And don’t worry about who’s going to clean the mess up after the party is over. The world is going to come tomorrow morning and clean it up. Remember, we got their money.

Carlo

Doubling the first-time homebuyer credit to $16,000 for six months !  I DONT THINK SO !  ALL SHOULD BE REQUIRED TO HAVE A 20 PERCENT DOWN PAYMENT ! ARE YOU FORGETTING WHAT GOT US IN THIS MESS TO BEGIN WITH !!!!! HELLO !!!!!!  ONLY A REAL ESTATE AGENT WOULD SAY THIS !

I agree with you Jim! Only a Realtor would want more relief programs so they can sell more homes to more unqualified people. If the government needs to do anything, they need to enforce higher education to sell real estate, not just some house wife, or losers who failed in other career and then found real estate as easy money. All they think about is the commission at the time the sale closes, not whether or not the homeowner can afford it. In times of chaos, you don't panic! You go back to the basics. Homeowners need 20% down to buy a house (period!); no government credit, no secondary mortgage, junior finanancing. Americans need to go back to work or learn new skills to find work and save their money to buy their home. It may not be a quick fix but in time prices and value of the dollar earned (NOT borrowed) will be real again.

I see the danger in doubling the homebuyer credit, especially under the current structure where buyers can basically use the credit as a down payment and therefore front very little, if any, of their own money to purchase a property. Sure, the credit is technically their money, but it's money they wouldn't have unless they purchased a home.

On the other hand, since the credit is not a loan and does not have to be repaid, it gives the homebuyers instant equity (a point HUD Secretary Shaun Donovan likes to make) and therefore more likely to hold on to that asset and not walk away from it if they hit some financial turbulence down the road.

Maybe doubling the tax credit should only be considered if it goes hand in hand with requiring a larger down payment from the buyer's own pocket before they receive the tax credit.

I do like Mr. Henry's idea of expanding the tax credit to investors.

This a response to N24REAL, I live in Vermont and I am TRYING to sell some RE here.  There are VERY few rich investors here, actually, just a lot of very savvy Vermonters who don't overextend themselves by buying houses out of their ability to afford, and also a lot of smart local banks who won't let you do it anyway!  We DO have a lot of homes on the market however, and prices have dropped 15 -20 % in the last 12 months.  I would prefer to see the first time home buyers get a chance to buy a place instead of paying the skyrocketing rental fees, so I think the tax credit increase would be a good idea, here, anyway.  

Just how do you expect first time home buyers, who make minimum wages, to save up 20% for a down payment, when they also have to pay $700-800 month rent for a halfway decent place?  10 % is more than enough for them to come up with...

Oh, I will be curious about this packet!

Loan Modification Expert

I don't like the idea of giving the tax credit to investors.  They will get enough from the rental fees they charge, and they no doubt will be fairly high so that no one except those holding Section 8 vouchers need apply.  We never got a tax credit when we bought our house 47 years ago - and yes we refinanced when the city increased our housing values across the board due in some part I believe to the comp manipulations of certain individuals who really scammed $$$ and left vacant uncared for houses  before the rush of foreclosures even started.  Now that the housing values are falling  - went from $176,000 down to $121,000 in 2 years, we are in the group that owe more than our property worth.  Refinancing like many, but we are able to handle it so far.  But we keep going as best we can, we don't ask for handouts nor expect them, we make improvements with cash when it is saved up, we don't compete with the Jones's as the old saying used to go, we don't have snowmobiles, campers, motorboats, fancy cell phones, a lot of regular phone custom services.....get the message, live within your means, but then too, our means have never given us the chance to make so much money that we could make money off money.  What's it called - working class!

Hey KLW,

If somebody is low skilled ,making minimum wages this person should not be a homeowner PERIOD.

The Clinton's era experiment of giving mortgages to low income people is a clear example. They might have subsidied housing, renting etc but never a 200K + mortgage that they will never be able to repay.

Do not forget history so we do not have to repeat it

This whole housing fiasco was created by the media. When the daily news inflicts panic on homeowners by broadcasting daily that the housing market is a bubble about to burst, of course investors and homeowners flood the market with houses which drives down prices and the banks get scared of the properties they own which they must now write down and of course the bubble which was possibly over inflated, but most likely not to the point of bursting suddenly bursts.

It's the same media that covered up the facts and slanted the news to skew the election of what appears to be the worst President in U.S. history.  

July 20 was his sixth month in office and look at what is happening. And we're in for three and a half more years of this.  

Bush should have started to solve this problem, but he spent the money on other things.

Its good they are finally started to look at the problem of homeowners with "up-side down" mortgages. Many people don't care anymore about walking away from their homes because vast difference between the amount owed vs the value of these homes. This is not good for the banks because their biggest threat and course of action (foreclosure) does not faze these homeowners. They almost look forward to the foreclosure process: save up 3 months to a years worth of payments then walk away from their worthless homes, after the bank gives them the boot with $5000 + in their pockets :).....You really can't blame them....

jai,

Media is responsible for this.............Congrats. U seem to figure out the problem that entire country is trying to solve.

But what about the shadow inventory. Recovery signs are premature, we still have inventory on the shelves that buyers haven't yet been exposed to.

I see that your foreclosure rates are based on housing units; i.e. “…1.19 percent of all U.S. housing units (one in 84) received at least one foreclosure filing in the first half of the year.”

Isn't this misleading? Not all housing units have mortgages.

Rate of foreclosures by metro should be based on housing units with mortgages. You can't foreclose on homes with no mortgages.

Nick,

Ideally we would use housing units with mortgages but when we checked into this in the past we were not able to find a source for updated numbers on that across the country and down to the county and zip code levels. We'll check on that again. Any information you have is appreciated.

Daren

I never cease to be amazed at all the people who are looking for someone to blame. The only people who are responsible for this mess are the average American. We have spent the last 20 plus years getting what we wanted when we wanted. Sure, corporate greed has a TON of blame in all this and not nearly enough of those people are in jail. I cannot help but laugh at all the idiots who want to blame this on Realtors. My guess is most of them are people who ended up at some fast food joint flipping burgers and now they are pissed at the world. If you think being a Realtor is so easy then shut your mouth and show us all. I am sure you will make it about 3 weeks. This problem is caused by ALL of our greed, nothing more.....nothing less. Quit your crying and do something to make it better.

S.R.

There isn't any releaf coming through these loan modification's.  All I hear when someone tries to find help from their Bank's or Hope is they take you to a point and then never get back to you.  If they do then they tack on the orginal loan amount to the end of the new loan.  What kind of relief is that for a homeowner that got caught up with the Banks Loaning the money to people that should have never got the loan?  Loan modification is just making the Lender's More Money!!  Why don't they just do a new loan at current value for owner with no penalties?

Great news. I wonder when the falling of banks will stop. This year there have been 72 of them gone bankrupt.

What is it with this "shadow inventory" thing? Merely created to add shock values, these buzz words have no merit. Just viewed a report stating that the Manhattan Condo Market should be STABILIZED by the 4th Quarter, so what's this shadow inventory talk? Real estate is three things, Cyclical, Seasonal and Emotional. We are involved in all three, but we're seeing signs of recovery and that's what we should be focused on. accuriz.com/RealEstate_Reports.aspx

J,

Well, we saw more than 1.5 milliion properties nationwide receive some type of foreclosure filing between January and June 2009. More than 400,000 of those were bank repossessions (REOs). Both those figures are based on RealtyTrac's report.

Let me know if that answers your question.

With the loan modification became the biggest scam them ever. This is a shame for all us Americans.

Great post

I heard a news story yesterday that most economists believe the recession is over.  I guess we don't have to worry about the graphs in the story, because the recession is over. Don't worry about the fact that we still haven't reached the peak of the foreclosure crisis, because the recession is over. We also don't have to worry about the fact that Fanny Mae and Freddie Mack continue the same real estate policies that got us in this mess to begin with, because the recession is over.

Just one question: Does anyone in government have a brain, or are they required to leave it at home when they go to Washington?

Sherm

I would like to invite you to our national conference on hard money lending, REO banked-owned properties, financing, residential mortgage pools and much more. The conference will be held in Las Vegas, Nev., at the Rio Hotel, on September 3, 2009.

Investors, brokers, private lenders and real estate developers from around the country will be attending this once in a lifetime event.

Pit Bull Mortgage School

http://www.pitbullseminars.com

I believe the worse of this is the fillings: you think that (foreclosure) can happen, but you dont know... That's a quite scary.

Great Post

Foreclosure filings in San Diego are still happening at record pace, although getting a short sale approved is getting more and more difficult.  Lenders are increasingly putting hurdles in the short sale approval process. It is no wonder that foreclosures are still at record highs.  

Thanks for the information Daren. Do you happen to know approximately how many actual homes have been repossessed (nationwide) since the subprime crisis began until now?

Thanks again, your help is much appreciated.

J

In Northern Virginia, we are seeing 3 to 6 offers on every bank-owned property that is coming to the market.

FHA underwriting metrics are becoming sporty, for instance, we are seeing (condos) the 60 percent owner-occupied ratio (owner/investor) as a restriction to funding.

FHA cash reserves required in condo associations has led to some large condo fee increases as local associations establish enough cash reserves for the respective community to qualify for FHA funding — one association increased condo fee by 18 percent to replace a funding short fall.

The buyers are savvy and demanding compelling value in the most sought after areas. We are seeing buyers with large cash positions simply waiting for the sellers to season the sales price towards compelling value.

Appraisal work product has become defensive at best and there is plenty of collateral damage that is being factored into the home that may have a distressed property adjacent to its property boundary. One home is $500,000 below last years’ value due to the close proximity of bank-owned properties — all real estate is local and all appraisals are local!    

Buyers: Set your value range. Let the market correct into this metric. Wait, but be prepared to move. Get your funding letter. Close in 30-days. Find a realtor who is hungry for value, not just a closing! Bank-owned properties sell at fair market value and this means .60/$1.00. Write offers. The banks will counter-offer!  

Sellers: The home needs to be a compelling value — great condition and well priced. FHA requires two appraisals. Conventional sale only one — and yes I suggest having the home appraised prior to the listing. The buyers are ready. They simply want a home that makes their heart beat faster at a defendable value!

The housing sector will recover — at the right price!

Joe Henry

Keller Williams/McLean

bankowned@mris.com

(571) 282-8249

With the expectation of more homes losing value I would expect that foreclosure would continue to be on the rise.  One would think that lenders would be working harder to save more of these homes.  At least that could help stabilize the prices of the REO's on their books.

I came across a site that offers help to homeowners by offering FREE services to help them with their loan workout.  The site is WWW.GETLOANMODOIFIED,com.  Hopefully more people will take the initiative to do something to help themselves instead of waiting around for the bank and or the government to come to them.  

If you are really frustrated then do something about it.  Don't let foreclosure happen to you.  Go to www.getloanmodified.com and get the help you need.  They offer FREE worksheets to help you do it yourself.  If you want to find a professional to help you can place your scenario on the site anonymously at no cost.  It's a no brainer if you really want to save your house.  You just have to take the initiative.

Scott

Why would anyone want to buy property at this time?  The U.S. economy is in shambles and the government will not be able to convince the angry citizens to spend any more bail-out money, so the next wave of foreclosures will happen with no more government programs to offset them.

This spring season was the last chance for homeowners to get out, now prices in key markets like California will crumble even faster, and buyers will simply sit it out.

Lawrence Smith

I would like to take this opportunity to invite all Americans to assemble and pressure their local and state legislatures to put forward new city ordinances, state and hopefully federal laws prohibiting real estate property transactions below the home building cost. I support free markets and I am usually skeptic about government interventions but for these foreclosure markets especially in California REGULATION IS NEEDED NOW. While the financial sector is cashing out and allowing bonuses to their executives the construction sector is bankrupt, putting a lot of people out of work. Meanwhile, homeowners live in fear knowing that they owe more on their houses than what the properties are valued in these foreclosure-driven markets. As a result, spending remains down affecting all sectors of the economy as well as economic growth is blocked because nobody is in position to access their home equity to start new businesses or making new investments. Severely under-priced bank-owned properties are not only driving home values down into negative equity, putting a financial burden on homeowners, but also are contributing to the increasing unemployment rate. The current measures are not working. If over-priced properties create the mortgage bubble that let us into a recession, ridiculously under-priced foreclosure houses will let us into a deep depression soon if this vicious cycle continues.

Mark Sagnep

Hey Joe Henry,  

Being in the real estate biz, I am sure you also are aware that these “bank owned” properties are more often taking “cash” buyers versus “loan” buyers.  And those "cash" buyers for the most part are investors, and flippers waiting to mark up that property for sale again. I have noticed that banks will pull or hold properties from MLS until like now multiple bidding wars have started truly shutting out the first-time home buyers.  

And this has also caused other buyers getting themselves caught up in the bidding frenzy by up their original offer amount hoping their offer would be accepted, only to find out a "cash" buyer out did them.

Buyers beware of the bidding wars, don't get caught up in them, let the market fizzle with these foreclosed homes. Many of these homes are pure junk that were thrashed and gutted. Many of these homes are not worth the price listed, AND if you are a owner-occupied buyer, it will be a challenge for a lender to include repair costs fixing the damage or rot many of these homes have.  

Go buy a newly built home instead, you won't find yourself in fraustration with a damaged goods home that may also have other underlying issues.

Dianne

It looks like this correction is still in full swing.  I think now is a great time to buy property.  It makes more sense now then buying when the economy is riding high along with house prices.

I disagree with some of the comments. I see buyers who are looking for specifics jumping at the chance to get in to the market. I, myself, am looking at multi-family as well as vacant land to work with and rent and lease....

While the dam on the forclosure market appears to be allowing some flow, there is another factor involved in the top foreclosure markets such as Southern Florida.  There are so many foreclosures in this area that some lenders are starting to actually hold properties off the market for fear of driving home values to even lower levels.  

With thousands of 3 bedroom, 2 bath, 2 car garage homes (bank owned foreclosures, auctions)  now on the market down here, prices have dropped to as low as $50,000 to $60,000. Those figures are common, not just a unique example.   In many special cases, new, unfinished homes are selling for even less.   This due to the many builders that went bankrupt and had to just abandon the properties.  There are entire streets of foreclosed homes that were started by a contractor that went belly up.    With that backlog who knows where home values will go?   This does not count those homeowners who financed their home with a 5-year adjustable rate mortgage.  They paid $300,000 to $400,000 for a home that is now worth one-third of that.

While they must continue to pay for the original purchase price at the higher rate.  Many families will have no choice and just walk away.

All this might be happening in the rest of the country with the exception of the coastal area in California, where the banks are holding REO homes, and not listing them nowhere.

Here in Orange County California exist the Gangsterism between the banks, and the real estate. Is really disgusting the game they play, and of coarse the lies/misleading.

To purchase a home here is the equivalent of becoming a "Knife-Catcher"

I must disagree with Diane's comments above.  I am one of those "cash buyers" and have been out bid by buyers buying properties via mortgage--three out of three attempts.  I am in Charleston, SC.

The banks are holding millions of homes and loans in SIVS off balance sheet that have been foreclosed on or are deeply in default they are not releasing them to the market. The true bottom is years away when all these homes have filtered through --20 cents on the dollar within 18-24 months

I know for a fact that some auctioned properties are gutted as Diane said.  I got one.  

What happened was the period between open for inspection and auctioning day was long enough for criminals to move in.  The property was vacated and the bank careless of what's going on.  Besides stolen properties, the druggies use the house for dealings.  TV4 of the SF Bay area recently had a report on this problem.  

If you are going to bid on a property, you need to know it well before you sign that contract.  The contract may prevent you and your Realtor from entering the house until after escrow closed.  That's too late.  

I inspected a duet house and did not know that the roof had a hole because the ceiling blocks the view.  It's 2-story high and one can't see it from the street.  Fortunately, I came back the next day and talked to the adjacent owner (sharing a common wall) who wished to have a more co-operative neighbor so that both owners can agree on repairing termite damage and tent the building.  He then told me that the roof was punched from inside out before it was vacated.    

I didn't bid on the duet and got the one with more problems.  It was frustrating to get out of the deal but it was taken care of.  

Be careful and check everything out thoroughly.  Use your senses, nose also.  There are mean people who would pour liquid or bad things with odor inside the walls.  If you have kids, buy a new house.  There are no drug needles in it.  A newer house has no asbestos in it either.

Best of luck to all.

Larry wrote:  Why would anyone want to buy property at this time?  

It's low interest rate that makes it possible for many.  Rate will go up as the U.S. cannot continue with low interest rate (0 - 0.25 fed rate) and not run into more serious economic problems down the road.  

If you do buy, make it something that you can live with even if price dips further.  Prepare for a 15% pain (or elation).  Do a budget and don't get in a bidding war.  If you estimate that you can repair it for a very reasonable amount, add an escalation amount to it.  The older the house, the more the contingency amount.  

I do home repairs and often add 30 - 35% to my estimates and, more often than not, the escalated figure was the right one.   Discount this in your bid.  Walk away when you must.  Get a lawyer if you are in a bad deal.  The banks are not easy to deal with.  (IMHO, you and I would never find a nice banker unless we have money.)  

Mortgage delinquency follows what we see on foreclosure statistics: an increase of foreclosure filings in whole county and all states!

The only people who will do OK from this are those who have gone without in the past and who have saved for their future and now have cash to spend......

We may be seeing signs that the real estate market has reached equilibrium. If the jobs market returns, things may pick up more than expected. The market may return to everything being local as it has been in the past.

Very nice site!

Being in real estate for over three years right in the short sale/foreclosure forefront  — I’m finding that I can’t even sell my home for what it’s worth and am considering walking away. I took all my equity out to survive on, while I tried to close deals that banks were never going to let go in a short sale.  

 What are the tax ramifications now — August, 2009, for homeowners and equity lines?  Are we getting taxed for the full amount or are we able to walk away freely?

Jacklyn

I don't think he's eitherof those. There are always two sides of the coin!

Wow!

What an awesome sight. I wish I had found this a year ago!  I have you bookmarked in order to come back and reference.  

Again, great site!

Laura

Greetings from Northern Virginia!

Homes that Cost More Than $1M -  21 Months of Supply

Homes that Cost  Less Than $300K - 7 Months of Supply

Market Equilibrium = 6 Months Supply

The First Time Home Buyer Owns The Pace of This Recovery...Health Care Reform for The Housing Sector....Extend the First Time Home Buyer Credit to 9/1/10 and Double the Credit in Specific Distressed Areas...

Joe Henry/Keller Williams/McLean

bankowned@mris.com

(571) 282-8249

24/7

I completely agree with this article. After working in the industry for over 15 years it is honestly insane the amount of foreclosures that are occurring just in the last few years. I have seen first hand the damage foreclosure causes and the good people it affects. Most people are getting so rapped up in the "numbers" and forgetting about the individual cases and the atrocities going on because of crooked and greedy loan officers...It makes me sick:

Curious. I read in other places that foreclosures were down.

Kevin Simpson

Jim Cramer says now is a good time to buy and foreclosures are over.

Cramer also said buy Bear Stearns up to 36 hours prior to its collapse.I'm still in the market to buy though. We're in the bottom 20 percent of the market and that's what you have to shoot for.

John F.

looking for Las Vegas foreclosures!

Too many people applied to get this credit. It's a punch for the government that will spend more money to pay this debt in the finance

Jim Cramer also said that the loan problems with Countrywide were a very small percentage and would harldly be a blip on the screen, if anything... and that there was not need to worry. I remember being amazed at his ignorance then... the writing and the data was already all over the wall. Buy. Buy. Buy. Anyone who knows the history of Jim and Wall Street knows to never listen to him during a bear market... except for entertainment value.

Over 3M homeowners are behind in their mortgage payments and eligible for loan modification but only about 300,000 approved by lenders to reduce their payments.  The Homeowner Survival Guide I wrote, published by AuthorHouse, will provide the secrets and solutions to homeowners get approval, which will help speed up the entire process for both homeowners and lenders.  Also, none of the current programs can help those homeowners who has plenty of equity in their homes but due to loss of their jobs, cannot afford to make their mortgage payments.  I propose the government and lenders should come up with a home equity loan program in which all moeny out of the equity loan will be escrowed to make payments on the home (mortgage, tax, insurance, etc).  The amount of the home equity loan shall be cap at 80% LTV when combined with existing mortgages.  Such a program will prevent homeowners losing their life long build-up equity due to a temporary hardship.

And who cares what cramer have to say, Cramer is an Idiot, that everybody knows.

Now then the question is what is going to happens at years-end?

Because the tax-credit ending, first-time buyers would find it defficult to purchase, or to qualify.

The gov't is planning to end the program.

Well it is not a joke as it seems, But I wonder who is going to Insurance our accounts from now on.

I guess I will have to stash the money inside the Matress like in the old days.

Of course there's anxiety over the tax credit. Time is running out and everyone who wants to buy a house is looking for the money!

Tony Cartman

Your credit report should be reviewed if you want to have a good credit score. ...

There are good companies out there actually trying to help people. But unfortunately there are also bad ones that are trying to take advantage of the situations. I purchased 2 foreclosures and have been happy with my purchases.  

Unfortunately, Florida is one of the hardest hit areas and even though prices seem to be stabilizing I am well aware of the impending Alt-A & Option-ARM defaults due in 2010-2011. An estimated 1-1.5 Trillion of those loan types, and 50%-60% are expected to default almost matching the Sub-Prime catastrophe.

We are in the eye of the hurricane. Our commercial foreclosures are currently going through the roof, and we are seeing more high-end foreclosures in comparison to the Sub-Prime which we medium to low-end homes.

Helen Jaquith, GRI, CRS, CDPE

Invest in metal, not gold, but guns. Those families with guns will eat and families without  guns will not.

Where is our money going?!

Follow me on Twitter, lets connect:

twitter.com/OliverGraf360

This is all very true. In my market, Arizona, pending foreclosures are 2X higher than this time last year however trustee sales are not any higher. This is obviously due to banks starting the foreclosure process but (not) consummating with a foreclosure (trustee) auction.

www.azrentalhomes.com

It's horrible what's happening to all these people. The biggest problem I am seeing is the fact that lenders make it so difficult to get a loan mod approved if they are still current on their mortgages. These people are whittling away all their savings just to make ends meet and eventually they will default and have no savings to get themselves out of the jam....

That's great, I never thought about real estate like that before.

Good post.

Here in Portugal they were smarter.

Driver88

Jeff z: why? are you planning to roam the land like Mad Max and terrorize people with your guns?

Toni Braxton is such a talented lady, and it is sad that she was diagnosed with heart disease, and forced to cancel her tour. Unfortunately, many times no matter who you are, when medical issues, or any other of life's curve balls are thrown at you — one is forced to sell their home, or worse go into foreclosure.

Carolyn Hawkins

This post was mentioned on Twitter by Steve_Heideman: Waiting for the Next McMansion to Drop: Waiting for the Next McMansion to Drop The Wall Street Journal Despite .. http://bit.ly/2tnnxK

This post was mentioned on Twitter by shortsaleagents: Avoid Foreclosure: Obama administration facing new pressure on foreclosures: Oba.. http://bit.ly/4i9bsb - short sale

This financial cascade is bigger than any market or administration. Any attempt to stem its flow is like throwing sandbags in when the dam has collapsed. It will run its course.

Trying to treat the effects means throwing good money after bad as we have already seen.

Big money has to be directed at the now underlying problem: JOB LOSSES!

People without jobs cannot pay their mortgages, taxes or bills — no matter how many re-modifications, tax credits or softer repossession laws are imposed! These actions are only dragging this process out over a longer period of time, wasting more money and weakening our ability to be effective in the long term.

This is not a time for political posturing or half measures, no time to be cowering to crooked self-serving corporations. Now, more than ever, we need unwavering, focused strong government to put the big money into saving worthwhile industry, businesses, new innovative businesses, environmental-friendly and energy efficient businesses.

Government programs to enable workers to form co-ops to take over, restructure and save their jobs. Tax credits or increased social security going to unemployed who help to sustain or improve their communities through bonafide community projects. Imagine out of work parents helping children read, coaching, organizing, helping out stressed overburdened teachers, single parents, families in strife, the frail and weak. This is not about the individual, we are all in this together, united we stand. This is about our inner strength, our American collective soul.

We have to stop looking at the bug on the wind shield! Look at the road ahead. STIMULATE THE JOB MARKET, lift the spirit, give the people direction and hope, get the American show back on the road before it is too late.

Susan Morgan

Foreclosures in Southern Ca are still out of reach for most of us.  I want to buy a home in the 93063 area or Carpinteria.  I lived there for 38 years and miss it every minute.  But, too costly.  

How much of it is really unemployment and how much is the mortgage product?  I would guess the latter is contributing more to the problem.

I would agree that risky loan products are still the primary driver of foreclosures across the country, but I think we're starting to see unemployment start to drive foreclosures as well. That is simply based on the fact that we are seeing some new areas post big year-over-year increases in foreclosure activity that last year were largely insulated from the foreclosure problem.

Any one in Boise have any experience recently?

Utah is starting to get dark red. California, is almost completely dark red. What a mess.

I just talked to a reporter up in Boise who said they have had a booming real estate market there for a long time, and that there was a price bubble in the last few years that has now popped. He also pointed out that employment has quickly ballooned to nearly 10 percent there.

Foreclosures are spreading everywhere. There's no more distinction of classes for it!

Oh YEAH!! We've been house hunting in Boise since last Oct..Star, ID looks like "ground zero"!!  Boise is in bad bad shape..don't let the Realtors or reporters sell you any "fluff".  

We had two offers on short sales..both fell through..one due to mold and the other to "seasonal water problems".  Homes are rapidly coming down in price.  By the time you get to closing you've probably lost 20K.  

Get on RealtyTrac if you have to pay for it..key in the zip code or address you are looking for and you'll see..it looks like ants in an ant colony.  Two best things I ever invested in..RealtyTrac and a good home inspector.  Even though both deals fell through and we are out around 800 for the inspections..it was well worth it.  Many of the homes have not been winterized and therefore have leaks which lead to mold problems.  Our homes are not built on slabs and mold can be a real issue in the crawl spaces.  Caveat Emptor!!  Watch the SHORT SALES NEGOTIATORS!!  They do nothing..are not required to be licensed in our state..and want to be paid for calling the bank once per week!  The bank says this puts them behind trying to answer Realtor and Short Sale Negotiator calls and work their every increasing workload.  They are not staffed for this in many instances.  Someone said they have 500 per day and can only close on 15 a day.  Watch your short sales as some buyers will use you as a "place holder" in order to stay in the home.  Bank won't foreclose if they think they have a solid buyer.  Many times the buyer walks (tired of waiting)..Realtors don't notify banks that they have walked..when the bank discovers they have a new buyer, THE ENTIRE PROCESS STARTS OVER!

Bottom line:  You need a helmet and a seat belt to go shopping in Boise metro area!  

Has anyone been shopping or know anything about Bend, OR?  

Foreclosures are rising month to month. It's something that really seems out of control!

Carolyn,

Thanks for your insight. It is very interesting to hear about it from the front lines. Sounds like you're doing a great job of doing your research and not settling for anything less than a good home at a great price. Happy house hunting! Let us know how things turn out.

I wrote about Oregon back in May 2009. What I learned about Bend, in particular, is that it is a resort destination with quite a few multi-million dollar properties...and a lot of foreclosures.

Located in Deschutes County, RealtyTrac's figures for Q3 2009 showed that the county had the highest foreclosure rate in the state with one in every 57 housing units receiving a foreclosure filing. Activity was double from Q3 2008, but was up only about 8 percent from Q2 2009.

Hopefully foreclosures will start to decline soon. From what I can tell it seems like the worst is behind us in terms of the economy and the real estate market.

Zach

For sure this is a moment that we don’t have a distinction anymore between rich and poor. The foreclosure crisis took every class, every region by surprise.

Jacob

I was considering this move from our president. Now he proved that the credit really is something necessary nowadays

Real Estate doesn't bounce back like the stock market. People don't have the jobs to justify the loans or payments they never did even in they hype of the market and especially not now. A lot of the frenzy was created by borrowing more than homes were worth and bidding up the price and spending the equity on the over all economy. People are not spending all that extra equity slowing down the economy and they couldn't afford those prices anyway. To say it's near the bottom, get in now is just crazy talk. Get real a lot of those foreclosures will be empty and abandoned for years. sure Fannie or Freddie or some investor will buy them but they will sit empty and probably be bulldozed in 5-10 years or infested with animals. I don't think the government or banks will let many properties go for that cheap; they are buying up all the mortgages with tarp funds to hold the property back and slowly release it to the market to keep prices inflated. They will not be pushing prices up they just want a peaceful deflation and will be lucky in America Inc can pull it off. Prices are going no where but down; look at all the empty homes and pull your head out of your butt if you're not buying a foreclosure or getting a bargain your being ripped off and throwing half your investment away by paying too much.

How is the inventory the banks are holding off the market accounted for?

M. Kamadulski

Here's a great article titled "The Case of the Missing REO Inventory" that addresses this question in depth.

www.realtytrac.com/.../newsletter-articles.asp

Seems to me we'll be seeing a big influx of $500,000-plus homes. I have been getting only higher end assets the last 90 days. Properties that peaked at $700,000 to $1.1 million a few years ago are now selling for $500,000 to $850,000.

That's my two cents on the matter.

 Kevin Ford

There are more than 80 banks now that have gone bankrupt. Who knows when this will be over.

Miki

It's not.

Why are the banks holding back the inventory from the market?

GJN: here's an excerpt from the article referenced in a comment above by Rick Sharga. I think this addresses some possible answers to your question.

Lenders and servicers admit that it’s taking longer to process REOs than it has in the past, and they offer a number of legitimate reasons:

  1. -Many of the properties have title issues that need to be resolved

  2. -Many of the properties are in states of utter disrepair

  3. -A number of states have strict redemption rights periods, which prevents the lender from reselling the property

  4. -A few states have extended the length of eviction proceedings

  5. -The sheer volume of REO activity has created a “pig in the python” phenomena, (to put this in perspective, there will be roughly four times the number of REOs this year as in the last “normal” year, 2005)

What else could be slowing things down? A popular theory is that many banks are holding the properties off the market in order to defer losses. There is some accounting logic to this theory, as in most cases banks aren’t required to adjust asset prices until the actual resale of the property. Another idea is that the industry is holding back the inventory to create leverage with the government in order to force the creation of a “toxic bank” or RTC-like entity that would buy the distressed assets at 50 to 60 cents on the dollar rather than the 30 to 35 cents available on the market today. This theory suggests that, seeing the threat of a massive inventory of distressed homes being released all at once, the government would “blink” rather than risk another housing market meltdown.

This post is a great help. At <a href="www.coastalreosolutions.com">Coastal Reo Solutions</a> in Myrtle Beach, South Carolina our <a href="www.coastalreosolutions.com/blog">BLOG</a> has similar information that can help agents, investers, buyers and sellers of home and commercial real estate through the foreclosure and short sale process. Come by, give it read and leave us your opinion and comments please.

Thanks for the post.

On the contrary the worst is yet to come. 14% of mortgages are in foreclosure or delinquent. If you can believe that home foreclosures are closely tied to the unemployment percentage, as many banks. The US will see an increase in foreclosures and falling home values. If you add to this falling values and property tax systems that will not fall with the value of a home. The absence of the eight thousand dollar house tax break in 2010.  Then one can only expect that 2010 will surely not be a good year foreclosures or home values. There is a long way to the bottom left.

Like to be update with new information. Thanks

There have been a lot of mixed news relating to foreclosures lately, so which one is it? One report shows that they keep getting worse, while the next shows that they are improving?

Nice postings! On the other hand, according to the most recent statistics the unemployment rate is over 10.2%. It looks like that the mortgage market and car loan industry are on their ways to recover. Mortgage modifications are high in demand as people face difficult situation financially in every corner of the country.

We are a “web based” business specializing in the closing of Short Sale properties.  We have years of experience, backed-up by thousands of satisfied clients.  You are a professional Real Estate Agent, not a professional Short Sale negotiator. Our negotiators are experienced former loss mitigators who bring the highest level of professionalism and expertise to our Short Sale negotiations.  They know exactly what to say and who to say it to. They even have contacts at many of the major banks to expedite the process.  Your success rate will be much higher when you work with us. Short Sales are not a sure thing.  It is ultimately up to the Lender as to whether-or-not they accept a Short Sale. You don’t want to waste months of your time negotiating a Short Sale just to have it rejected.  When you work with us, you can list all of the Short Sale opportunities you can possibly find, because you won’t be spending your time negotiating them. We offer Realtors the ability to add to their income, by offering a streamline process that quickly and easily closes Short Sale transactions, giving them commission checks they would otherwise miss, or avoid. We are not "how-to-do-it" Short Sale educators.  We are not a Short Sale service.  We will be working directly with your Seller and their Lender(s) to buy the property and have you list it for us at an extremely competitive price, enabling you to sell it quickly and earn your full commission.  To put it simply…YOU  list and sell the property! WE handle the Short Sale! YOU make your commission! It really is that simple!

•There are no fees or costs of any kind to the Agent or Seller.

•You receive your full listing commission.

•Houses sell quickly - you have a very competitive price.

•We handle the Short Sale – saving you many hours of time and increasing your success rate.

•You, as the Agent, retain the listing and your client.

•You don’t endure more long phone calls and frustration dealing with loss mitigation.

•You make your FULL listing commission.  When you handle Short Sales yourself, Lenders will negotiate your commission down.  We ensure that you receive what you earned - your FULL commission.

•We relieve you of the headache.  If you’ve ever tried to negotiate Short Sales yourself, you know how time consuming and frustrating they are. Working with us is a way to earn commission on properties you would otherwise avoid without any of the headaches or hassles.

•You don’t have to wait weeks or months for a qualified Buyer before you can even start the Short Sale process – we are the Buyer and start the process immediately!

•After all, real estate is a numbers game.  The more houses you list, the better your chances are of closing some – especially when you’re able to list them at extremely competitive prices!

Questions? E-mail me at rthomas@easyrealestateincome.com and we’ll be happy to assist you. Contact us today to use our proven system to tap into the current mortgage meltdown, work with more Sellers, and free up your time to sell more houses and explode your commissions!

This post was mentioned on Twitter by Steve_Heideman: Former OU Football Star Defaults on Malibu Home: A Notice of Default has been filed on a Malibu, Calif., mansion ow... http://bit.ly/7u0yDB

Since Q1 2009 the foreclosure heat map has gotten hotter everywhere. I can barely wait to see how it looks for Q4 2009.

It appears that this map says if you buy now red means your finances are dead.

I am curious. I am in active foreclosure and have been given an auction date. I have found a rental rather than try to live thru the emotional roller coaster of probable postponement. If my lender  does not actually perform the auction for several months does my debt continue to mount, or does it stop on the stated foreclosure date?

In Nevada, we've had a delay in foreclosure activity due to the "Mediation" that was legislated here this past summer.

Many are taking advantage to temporarily stop their foreclosure activity by posting the $200 fee and getting in line for an appointment with the lender and mediator.

Ultimately, I expect a minimum of 75 percent of those who've delayed the action to end up short selling or letting it go to foreclosure.

Without a principal reduction — who'd fight to keep a home that's lost a minimum of 50 percent of its previous value.

I've just worked on a short sale where the person paid $237,200 in 2007, and it just sold "short" for $70,000! Sure say's a lot doesn't it?

Michael Patton

This post was mentioned on Twitter by Steve_Heideman: Foreclosure relief program is stuck in first: Foreclosure relief program is stuck in first The Washington Post The ... http://bit.ly/64Jk5n

We bought 2 properties at the big DC foreclosure auction last week, and are still waiting for "bank approval".  One property has big mold issues that will only get worse as it sits vacant.  I sometimes wonder if these lending institutions didn't bring on a lot of these problems themselves - lending money on property sight-unseen.  

This is a cool news. Thank you.

I think we can expect a recovery, but not too big.

 Thanks for all these news and updates. Good luck.

 Mitch

I’m inquiring about how to invest in U.S. government foreclosure and who to go through?

Bob

This post was mentioned on Twitter by Steve_Heideman: Video: browsing the new RealtyTrac Community: RealtyTrac recently launched a new online forum focused on the forecl... http://bit.ly/8spSIs

This post was mentioned on Twitter by Steve_Heideman: More prime mortgages default in 3rd quarter: More prime mortgages default in 3rd quarter Los Angeles Times Reportin... http://bit.ly/4vKfO0

This post was mentioned on Twitter by Steve_Heideman: Notice of Default filed against Keyshawn Johnson property: A Notice of Default was recorded Dec. 17, 2009, on a nea... http://bit.ly/8QOSlt

That IS a lot of foreclosures and dispite government efforts, mortgage foreclosures still rise.  Maybe free credit isn't the answer to the foreclosure crisis?

Risso,

Yes it is a lot of foreclosures, and the 2009 numbers will be higher despite even more efforts on the part of the government during the year.

I'm looking for a law firm that is doing a class action lawsuit against the mortgage companies, so I can maybe get my home back...help!

Vicki Snyder

I'm looking to purchase a foreclosed home.

Kym Terry

Kym,

I'd recommend going to RealtyTrac and running a free search in your area to get started. That will give you an idea of what is available. Here's a link to the free search: www.realtytrac.com/mapsearch.

You can also read about how the foreclosure process works and how to buy a foreclosure at RealtyTrac:

www.realtytrac.com/.../overview.html

www.realtytrac.com/.../how-to-buy-foreclosures.html

Hang in there big fella.  Take a deep breathe and let them know that you are still working and can produce. Check with other institutions and even check with the NFL retirement committee about a loan. Does ESPN have a credit union? You have options. Don’t let them take your “casa.”

Kenneth Nelson

Can you tell me what % of REOs are jumbos, or how much they have increrased since Jan 09?

Thanks

Pat Moore

First Asset

I don't have that data readily available, but I can do some digging and see if I can find out.

I have about decided to walk away. My house has been on the market for a year, with no nibbles. I tried to negotiate, but my lender--Countrywide--said no dice, if the house is on the market. That's a Catch 22.  I'm satisfied there's no longer any shame or social opprobrium and plan to cease mortgage payments as of Feb. 1. Most say I have 5 or 6 months before foreclosure, which will allow me to accumulate enough of a kitty to move into a rental. I've written the lender about my intentions and hope--without expecting it--that they won't start harrassing until about Feb. 15. Does anyone have any experience to shed on walkaway. The Times last Sunday had an excellent piece on it. Seems 1000s are no doing it.

I'm having a senior moment; where is the monthly report for December that breaks out foreclosure actions by type?  

Thanks.

Tom Lawler

Tom,

Thanks for your question. It wasn't a senior moment; we just hadn't posted the December numbers since most of the focus of the report was on year-end numbers.

I've added a screenshot of the December numbers at the bottom of this original post.

When will December data be available?  I can't access the screenshot, was the data moved?

Madeline,

Not sure why you can't access the screenshot, but if that is still a problem please shoot me an e-mail at darenb@realtytrac.com and I'll make sure you get the December data.

Daren

Fairfax County, Virginia

7 out of 10 Homes Under $500K are Under Contract with a 6.4% unemployment rate(Fairfax County)...the market is speaking to us and the compelling value is defendable...we are in the bottom of the seventh inning...in Northern Virginia...

Joe Henry/Keller Williams/McLean

bankowned@mris.com

This is a good news for all homeowners who are affected by foreclosure problems. Hope more people are going to be helped and more banks will provide assistance to those facing foreclosure.

I live in So. Ca., Riverside County.  My mortgage documents include three forgeries of my name.  It has taken me over a year of asking by phone a copy of my mortgage papers.  I'm able to make the interest payments for this loan, a 7/1 ARM at 51/2 %.  I've notified Indy Mac now One West Bank and sent backup to substantiate my claim.  Also, I sent to Rod Pacheco, District Attorney of Riverside County and Edmund Brown, Jr., Ca. Attorney General.  I cannot afford an attorney for I'm a retired school teacher with a fixed income and barely enough in savings to cover four months of expenses.  No one has responded and it's been since Dec. 1 when all was mailed certified.  With deep reservation and ethical regret, I skipped my January 2010 mortgage payment in order to send a message.  I was told by the bank the result of their research would be forthcoming Feb. 11.  All three credit agencies have been notified of the forgeries on my mortgage with One West Bank.

I feel so alone and uncertain in this nightmare.  I have no family support in California and desperately need advice, guidance and direction.  Am I at the mercy of the bank?  Is it possible for me to obtain a new mortgage now at market value?  Should I go ahead and contact one of the many Mortgage Modification agencies that advertise?  Should I pay the January statement with late penalty?  HELP!

Pingback from  Foreclosure Filings Near 4 Million In 2009, Worst Since Depression  : Refinance, Home Mortgage Loans & Rates, Home Equity Loan

During the past week, I have met several homeowners whose homes have been foreclosed while they were fully engaged in loan modification process. At least two of them had approved forebearance agreement and before they knew it was coming, they find out their homes have been foreclosed by B of A.

This post was mentioned on Twitter by ericstewart2: http://bit.ly/8aSgno - Treasury Weighs Fixes to Foreclosures Program

RealtyTrac is an invaluable data source providing clear facts during a storm of political spin.  Another great data source is John Hussman (hussman.com) whose charts show that the biggest waves of mortgage resets for Alt-A and Option Arm mortgages are forthcoming in 2010.  Thank you both for the clear fact-based data.

I might just be doing something wrong, but I don't see any results...  just a short paragraph with your notes.

Hmm. There should be a graph showing the U.S. foreclosure activity by month. Sorry about that, but I can send to you directly if you want to send me an e-mail at darenb@realtytrac.com.

Hi there is it possible to get a copy of the 2009 year end Metropolitan foreclosure report emailed to me at alanau@shaw.ca.

Thanks Alan

Fourth Quarter earnings send mixed signals for 2010.  That's the headline.  Mattel's earnings up 17 percent, some banks are up and some are down.  Financial institutions see remarkable earnings in view of bail outs and bonus arbitration.  Hang onto your hats; it's going to be another roller coaster year.  

As long as the crooked banks can continue to get their pimps in DC to steal our tax dollars for bank bonuses and welfare, these bags of excrement can continue to sit on their foreclosures and the market will remain screwed up forever.

Alan,

You can find the complete report online at the following URL: www.realtytrac.com/.../pressrelease.aspx

This post was mentioned on Twitter by alainvu: NEWS Rising FHA default rate foreshadows a crush of foreclosures: Rising FHA default rate foreshadows a crush of f... http://bit.ly/dA2l9u

Images were a no-show.

Thanks for letting me know. I'm working with my IT guys right now to fix.

Foreclosures are going to rise all 2010.

This post was mentioned on Twitter by alainvu: NEWS Editorial: Treasure Coast program could save even more homes from foreclosure: Editorial: Treasure Coast prog... http://bit.ly/dfmQFb

The image is missing.

So sorry about that. I tried to re-post image. Let me know if you still don't see it.

When I read "Nevada", I interpret "Las Vegas". Whenever the air starts blowing into the housing market again, I wonder if those places (Las Vegas, Miami, San Diego) that were such the rage, will the the best values and highest ROI for investment property or are they never to be repeated anomalies?

foreclosures are part of pop culture? cheezzzzz  typobounty.com/.../Foreclosure.htm

That cool heatmap image is still missing. I had linked out to my blog and I noticed the link is broken.

This post was mentioned on Twitter by alainvu: NEWS Citi's Foreclosure Alternative Allows Homeowners to Stay for Six Months: Citi's Foreclosure Alternative Allow... http://bit.ly/dlJITD

This post was mentioned on Twitter by alainvu: NEWS Mortgage officials try exits softer than foreclosures: Mortgage officials try exits softer than foreclosures ... http://bit.ly/9w7QA8

Sorry about the problems with the heat map. We're working on a long-term fix, but I did try to post it again. Let me know if that doesn't work.

I am glad to hear that the percentage of missed mortgage payments have gone down, but I don't believe we are out of the woods yet regarding the housing market.  I do agree with this article that there will be another dip in housing.  I think this will probably occur later in the year around August or Sept.  

Paris Girl

This is a complicated issue that specialists predicted. The 2010 wave is coming and for sure will make a big damage.

Tony

Let's wait to see the stats of 2010. Will be bigger!

This RealtyTrac job is really nice. They make a complete view over the foreclosure scenario, making us informed about the best and the worse regions. It's really good for investors!

I can make a relation of cars and foreclosure: When you buy a car, you have another debt to honor, making things more difficult to pay mortgage and avoid foreclosure. Without a vehicle, things get easier!

Tony

This post was mentioned on Twitter by alainvu: NEWS Canseco, Burress Homes Headed Towards Foreclosure: Two high profile professional athletes find themselves fac... http://bit.ly/anaRG5

the map is missing

Foreclosures are way up. The crisis is very serious and numbers are rising. This is something that really concerns me.

Tony

It looks like all the efforts of the mortgage modification programs are still not affecting the housing market.  I think this is only going to get worse as the year continues.  

Paris Girl

That ‘s the effect of the financial crisis. Houses are foreclosed left and right and if we don't act now we might end up with more losses. This is a great website! Really informative. I learned a lot.  Great stuff.  Keep it up

Interesting to see the rates falling, even with the predictions that things will turn into high numbers

I think this is very sad situation for everyone. I am one that is struggling to make my house payment. And the presidents ideas are not even WORKING for any one that needs help..

if the home i am renting in california is being forclosed on through citimortgageand my landlord signs over the property deed to citimortgage, do i also have 6 months to stay in the home before i am required to move out?

Visit my blog which has helpful tips if you are losing your home.  Our State Senator's office (Jeanne Shaheen) has an educated staff which is working to help us save our home.  Have you enlisted the help of your Senator/s & Governor?

dontloseyourhouse.blogspot.com

Excellent article. I will take note. Many thanks for the story!

Addie,

That's a great question. If this is possible, you would certainly need to work it out with your landlord and CitiMortgage. You can view CitiMortgage's press release on the program at www.citimortgage.com/.../ForeclosureAlternativesProgramPressRelease.pdf.

That press release says to contact 866-781-0322 for more information.

We still have high unemployment. With the jobless rate not changing, we won't be able to see an increase in economic activity.