FHA Drops 3 year Ban on Repurchasing After Short Sale
In other words…there will be “life (home ownership) after Short Sale.”
This may help a few Homeowners who have already “short sold” their home…or it can make a big difference to your future Homeowners who are considering a “short sale” in the future.
FHA has financing for homeowners who are short selling their home and want to repurchase another home after the short sale is approved and completed thru their current lender.
There are a number of home owners who will qualify for this program by meeting the “extenuating circumstances” criteria.
The FINE PRINT:
1) The Homeowner must be current on their mortgage and all other credit obligations for the 12 months prior to the actual short sale completion date.
2) Home owners must document “hardship” defined as:
a) Job loss and subsequent job transfer/ relocation… (a new stream of income will be needed to qualify for the new loan).
b) Catastrophic medical bills (and/ or possible death) incurred by a member of the borrower’s “nuclear family” (i.e. co signer of the current mortgage..child…spouse..or other dependent as listed on the borrower’s tax returns).
The Homeowner must be downsizing and relocating. Buying a bigger home across the street will not fly.
The Homeowner’s current lender(s) must be willing to approve the short sale of their current residence.
The Homeowners credit scores need to be above 620 and any outstanding collections (usually medical bills) need to be paid THRU ESCROW (ONLY) at COE.
Servicemen & Women Given Homes and Money for Wrongful Evictions!
Major banks will reimburse military servicemembers for any wrongful foreclosures done in the past five years.
JPMorgan Chase ($38.19 0.5798%), Wells Fargo ($30.69 0.43%),Citigroup ($33.44 0.5162%), and Ally Financial ($23.50 0.14%) will resolve Servicemembers Civil Relief Act claims in connection to the wider $25 billion foreclosure settlement, U.S. Assistant Attorney General Thomas Perez said in a speech Friday.
These four banks will conduct a review overseen by the Justice Department to find any foreclosure violations of SCRA since Jan. 1, 2006.
Wells, Citi and Ally will pay a military family a minimum $116,785 plus any lost equity in a home wrongfully foreclosed upon.
These three banks will also review files for any interest charged above 6% on a mortgage, which would violate SCRA. Each will pay a refund plus interest on any amount charged above the limit or $500, which ever is larger.
Chase settled earlier with the Justice Department after it wrongfully evicted 14 servicemember families. The bank agreed to give back the home, or the cash equivalent if it was already sold as REO, clear of any debt along with a cash payout to be determined. It also set up a separate panel of military veterans last year to develop foreclosure prevention programs and other assistance.
Bank of America ($8.27 0.2%) also settled earlier with the Justice Department to pay more than $20 million to 157 servicemembers allegedly foreclosed on wrongfully between December 2006 and 2009. BofA will conduct a review as well, looking for any missteps between mid-2009 and 2010.
“From our first conversations, these servicers made it clear that they shared our goal of ensuring that any servicemember harmed as a result of a violation of the SCRA will receive full compensation,” Perez said. “With these agreements we will assure that will happen.”
jprior@housingwire.com
JP Morgan CHASE Home Prices Continue to Decline in 2012…Short Sale Rent Back
JPMorgan Chase ($37.61 -0.25%) expects home prices to stabilize in the spring “given recent improvements in housing indicators and economic data, though we recognize that the long-run demand-supply picture remains challenging.” Analysts still project another 5% drop in prices from the third quarter to a bottom in the first half of this year that will equate to a 35% decline from the peak. For the year, JPMorgan Chase expects home price to drop 1.6% from a year ago with net housing demand of roughly 1.6 million units. Analysts said the recent decision by the Federal Housing Finance Agency to start a pilot program for bulk REO sales “could be a positive for the housing market and for non-agencies more broadly.” “The outlook for the mortgage basis is practically binary, pivoting on the outlook for QE3,” according to Chase analysts, who also expect the AG settlement with mortgage servicers to be more of a non-agency event with little impact on agency MBS or rates. Late Friday, Freddie Mac disclosed all of the mortgage repurchase requests it handled from Jan. 1, 2009 and Dec. 31, 2011. This was the first-such filing the government-sponsored enterprise made with the Securities and Exchange Commission as mandated by Dodd-Frank. Look for more coverage this week on HousingWire.com. The Commerce Department reports housing starts for January on Thursday. Starts fell 4.1% in December after climbing 9.1% the prior month. Analysts polled by Econoday expect housing starts to rise to an annualized rate of 675,000 for the first month of 2012. The government estimates 583,900 housing units were completed in 2011, which is 10.4% lower than the prior year and at the lowest level recorded. Single-family starts were particularly anemic last year. Lawmakers in Greece approved new austerity measures aimed at keeping the country out of bankruptcy. The vote was met with rioting and begins the process of the beleaguered country receiving another $170 billion from the EU and the International Monetary Fund. Greece has remained solvent with $145 billion from the EU and IMF since May 2010. Some reports show the country plans to cut up to 15,000 jobs, lower pensions and drop the minimum wage by 22%. Protesters looted shops and set buildings ablaze in Athens following the vote. The Office of the Comptroller of the Currency closed Charter National Bank and Trust of Hoffman Estates, Ill., last week and appoint the Federal Deposit Insurance Corp. as receiver. The FDIC signed an agreement with Barrington Bank & Trust Co. of Barrington, Ill. to assume all of the $89.5 million of deposits and most of the $93.9 million of assets from the two branches of Charter National. The OCC also shuttered SCB Bank in Shelbyville, Ind. First Merchants Bank in Muncie, Ind., agreed to acquire all of the $182.6 million in assets and nearly all of the $171.6 million deposits from the four branches of SCB Bank. The FDIC estimates a cost of $51.3 million to its deposit insurance fund from the two failures.
Have You Done A Short Sale Then get a 1099C….Check Out What Chase Bank Did To Our Client!
For anyone wondering what a 1099C is…The bank – your lender – is giving notice to the IRS of loss on an investment. Good news is that President Bush helped out Americans when he was in office by enacting the Mortgage Debt Relief Act in 2007. Not to go off track here, but that will sunset December 2012.
Kris and I received a call from a homeowner that completed a short sale last year, he and his wife were on title as joint tenants. He wanted to let us know that he did receive a 1099C from Chase Bank…but here is the kicker…SO did his wife…for the full amount of the loss! Chase is reporting to the IRS Double loss!
Is this happening to anyone else?
What’s Going On…Short Sales Helping People Sell…Where Are The Buyers?
Wow, it’s hard to take it all in….one thing is clear….the housing market has a long way to go before we see housing prices stabilize. Great article by Dianne Olick
Anyone with any cash in hand should be buying a house right now.
That’s what any real estate agent will tell you, obviously, but that’s also what many investors now believe.
Unfortunately, the potential home-buying public…isn’t buying it.
January’s consumer confidence report found a drop in the number of Americans who plan to buy a home in the next six months. If, however, you take out the confidence issue, the fundamentals for buying are strong:
Home prices nationally are down 33 percent from their bubble peak, according to the latest S&P/Case-Shiller report, mortgage rates are hovering near record lows, and housing supply, while falling, is still historically high. In other words, it’s more of a buyer’s market than it’s ever been.
And yet the home ownership rate continues to fall, and rental demand, occupancies and rates continue to rise.
“Federal plans to sell real estate owned properties to investors might provide some relief, but rental value growth is still likely to hit 3 percent this year and average rental yields may rise to around 5.5 percent,” wrote Paul Diggle of Capital Economics, who believes the downturn in homeownership may still have further to run.
Both Diggle and Standard and Poors’ David Blitzer cite still tight credit as the major obstacle to housing demand. Rates are low, but to get those rates you need a significant down payment. The low down payment route, the FHA, has raised fees and premiums, which for some are a barrier to entry. A full third of the market is now all-cash.
“We have to get the demand up, we have to tighten the supply a little bit before we will see any shift in prices and we haven’t seen that,” said Blitzer in an interview on CNBC. But how do you tighten supply of foreclosed homes in neighborhoods that are so empty that the homes are deemed “unsellable.” Blitzer made an interesting observation:
“Periodically in studies of urban renewal, people come up with arguments that, take such and such a neighborhood, level it, fence it off for the next fifteen years until we need the land and then come back in,” said Blitzer. “That’s in effect what’s going to happen to some of these areas.”
Joe Montana…Our favorite Notre Dame Alumni Drops Home Price $14M…Short Sale?
http://realestate.aol.com/blog/gallery/take-a-peek-inside-villa-montana/#photo-11
As if the San Francisco 49ers needed another hit, one of its most famous alumna, Joe Montana, has defeatedly cut the asking price of his stunning Calistoga, Calif., home by a whopping $14 million.
The 500-acre “Villa Montana,” which hit the market in 2009 for $49 million (get it?), is now selling for a 29 percent markdown at $35 million – proof that even NFL Hall of Famers might be fumbling in a depressed housing market and sluggish economy.
Though, looking at pictures of the spectacular home, you’d be easily fooled into thinking it would sell anyway. The sprawling 9,700-square-foot Tuscan main house sits in lush wine country and is described by Joe Cool himself as “an expression of art and architecture.”
Though our friends at Curbed report that the estate lacks any “trace of a football past,” it’s still incredibly sports-friendly with full equestrian facilities (Montana loves horseback-riding), a basketball court, a swimming pool, a skeet-shooting range and even a bocce ball court. Inside the main house, you can enjoy some excellent Superbowl Sunday-friendly amenities — a beer tap, pizza oven and (multiple) flat-screen HDTVs, so you won’t miss a play.
For those who aren’t big on sports, that’s fine too — the estate also boasts an olive farm, a spa and a 45-foot-deep pond stocked with local bass.
Avram Goldman from Pacific Union International has the listing.
2011: Worst Year for New Housing Sales…More Short Sales?
A mericas continued housing troubles are plaguing new home builders as they announce their worst year ever.
WASHINGTON (AP) — Fewer Americans bought new homes in December. The decline made 2011 the worst year for new-home sales on records dating back nearly half a century.
The Commerce Department said Thursday new-home sales fell 2.2 percent last month to a seasonally adjusted annual pace of 307,000. The pace is less than half the 700,000 that economists say must be sold in a healthy economy.
About 302,000 new homes were sold last year. That’s less than the 323,000 sold in 2010, making last year’s sales the worst on records dating back to 1963. And it coincides with a report last week that said 2011 was the weakest year for single-family home construction on record.
The median sales prices for new homes dropped in December to $210,300. Builders continued to slash price to stay competitive in the depressed market.
Still, sales of new homes rose in the final quarter of 2011, supporting other signs of a slow turnaround that began at the end of the year.
Sales of previously occupied homes rose in December for a third straight month. Mortgage rates have never been lower. Homebuilders are slightly more hopeful because more people are saying they might consider buying this year. And home construction picked up in the final quarter of last year.
“Although this decline was unexpected, it does not change the story that housing has likely bottomed,” said Jennifer H. Lee, senior economist at BMO Capital Markets.
Ian Shepherdson, chief economist at High Frequency Economics, said easier lending requirements, historically low mortgage rates and improved hiring all point to consistent, albeit slow, rises in sales in the coming months.
“A sustained rise in new home sales is imminent,” he said. “Homebuilders say so too, and they should know.”
Hiring is critical to a housing rebound. The unemployment rate fell in December to its lowest level in nearly three years after the sixth straight month of solid job growth.
Economists caution that housing is a long way from fully recovering. Builders have stopped working on many projects because it’s been hard for them to get financing or to compete with cheaper resale homes. For many Americans, buying a home remains too big a risk more than four years after the housing bubble burst.
Though new-home sales represent less than 10 percent of the housing market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to the National Association of Home Builders.
A key reason for the dismal 2011 sales is that builders must compete with foreclosures and short sales — when lenders accept less for a house than what is owed on the mortgage
Builders ended 2011 with a third straight year of dismal home construction and the worst on record for single-family home building. But in a hopeful sign, single-family home construction, which makes up 70 percent of the market, increased in each of the last three months.
SHARP Short Sale Rent Back Program….Real Estate Agents In California, Arizona, Nevada…You Are Needed!
Are you a licensed Real Estate Agent in California, Arizona or Nevada? Do you understand the short sale process? Do you have a heart to help home owners avoid foreclosure….and stay in their home?
Contact us to find out how you can become a SHARP Certified Agent.
Kris and Kim
Equator.com Initiates 1.7Million Short Sales Over the Last 2 Years
This from California Association of Realtors:
Equator says nearly 1.2 million short sales were initiated through its module over the past two years. The company tracks this data through its default servicing platform, which helps mortgage industry clients deal with loan modifications, short sales, deeds-in-lieu, foreclosure processing and REOs.
4th Quarter 2011 Case-Shiller Housing index; Home Prices Worsening in Los Angeles…More Short Sales
Case-Shiller released the 4th quarter tracking on home prices. Los Angeles, while not a the top, certainly was showing now signs of home pricing rebounds…with an annualized decrease of almost 5% year over year and a 1 month decline of 1.5% from September “11 to October “11.
There is much talk about a massive influx of foreclosures in 2012…however, with continued declines I believe the numbers are much exaggerated. Why? The banks and services are already dealing from massive volumes of losses…supported by the recent announcement from BofA carrying over $2.5 billion in foreclosed housing inventory…yes, BofA is holding on to these homes to keep the hosting prices strong and limit the continued declines in pricing. If BofA flushed their inventory on the US Housing market, I project that the housing market would see an additional decrease of up to 0.5% based on the volume and impact to the seasonal lows. I believe banks are doing everything in their power to control housing prices.
Simple economics…greater inventory equates to reduced proportional demand equates to reduced housing prices.
With the banks now endorsing the once elusive Real Estate Short Sale…we will realize more incentives to sellers to choose short sale -vs- the alternative of walking away and adding foreclosure inventory to the overstressed housing market.
With the government endorsing new Short Sell, Rent and Buy Back programs, we will see Americans choosing to salvage their immediate futures and securing a more dignified solution to foreclosure by short selling their home to a “non-profit” entity, renting for a few years, and purchasing the home back minus the negative equity that strapped them to the burden…a win, win…win for all parties.
Heres is a snippet from the most recent Case Shiller Housing Report:
New York, December 27, 2011 – Data through October 2011, released today by S&P Indices for its S&P/Case-Shiller1 Home Price Indices, the leading measure of U.S. home prices, showed decreases of 1.1% and 1.2% for the 10- and 20-City Composites in October vs. September. Nineteen of the 20 cities covered by the indices also saw home prices decrease over the month. The 10- and 20-City Composites posted annual returns of -3.0% and -3.4% versus October 2010, respectively. Fourteen of the 20 MSAs and both Composites saw improved annual returns compared to September’s data. Miami saw no change in annual returns in October; while Atlanta, Detroit, Las Vegas, Los Angeles and Minneapolis saw their annual rates worsen. At -11.7% Atlanta posted the lowest annual return. Detroit and Washington DC were the only two cities to post positive annual returns of +2.5% and +1.3%, respectively.
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