Category Archives: Economy

Unemployed Borrowers Get Break from Fannie Mae

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New guidelines from Fannie Mae followed similar guidelines from Freddie Mac on forbearance for homeowners that are unemployed and facing foreclosure. The loan servicer can grant six months forbearance without the GSE’s approval.

If the borrower is still unemployed Fannie Mae can approve an additional six months forbearance. After that the lender and borrower must consider other options.

The borrower is expected to repay the lost payments over a longer period. But in reality, in many cases the forbearance would simply amount to one year free rent.

This follows a similar program last summer for FHA loans and loan modifications.

Read more: http://www.nytimes.com/2012/01/12/business/unemployed-mortgage-holders-get-payment-extension.html

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Mortgage Interest Rates at Record Low

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The rate on the 30-year fixed mortgage reached a new record low of 3.91 percent. This marks the third new low this year. The 15-year fixed mortgage rate, remained unchanged at a low of 3.21 percent.

The exceptionally low rates and the depressed prices have created a superb buying opportunity, but the opportunity is lost for many potential buyers because of the difficulty qualifying for new loans.

With so many homes underwater here in Reno and Sparks very few homeowners can qualify for a re-finance. Additionally, Nevada’s real unemployment further reduces the chances to re-finance.

Read more: http://www.businessweek.com/ap/financialnews/D9RPKO100.htm

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NAR says Over Counting was Minor

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The NAR ( National Association of Realtors) Has been fudging the data on the sales of esisting homes for at least the last four years. Just in case you didn’t make the connection, that’s at least since the Obama Immaculation.

The NAR is now revising their numbers downward, and by as much as 20%. Apparently the numbers didn’t match those of Corelogic. And now the NAR doesn’t want to be seen as untrustworthy, so, now they are revising their numbers downward. NAR numbers used to relied on as reliable and now they might be running scared.

The concern is that an over-count might mean that a much larger backlog of unsold homes still looms over the US economy. That could mean that another drop of as much as 20 % could loom over the US housing market.

But the NAR says they are working on a new method to re-evaluate the market.

I’m surely ready tojump in and trust them again. Aren’t you?

Read more: http://www.reuters.com/article/2011/02/22/us-usa-economy-housing-idUSTRE71L10U20110222

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Has the Housing Market Hit Bottom?

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Luxury home builder, Toll Brothers entered the Seattle market by buying CamWest development.

So what does this mean for Reno, and why should we care? Motley Fool takes this as a sign that we are now at the bottom of the market, and even though we may not increase quickly, we will probably not see significant decreases in prices in the near future. The larger operators will take this opportunity to buy smaller operators.

However, don’t take this as a sign that everything is suddenly all rosy. Prices have still fallen in the most recent months. Remember, the interest rates are at near historic lows. What would happen if the rates should suddenly climb?

Read more: http://www.dailyfinance.com/2011/11/28/one-sign-that-the-housing-market-has-hit-bottom/

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How Hard is it to get a New Mortgage Loan?

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Is it really hard to get a mortbgage loan? Some folks think so, but is it really the case? According to stan Humphsries, it”s acturally easier today than it was in 2000 or 2006.

In 2000, 54 percent of applications for conventional, owner-occupied, home purchase mortgages on one- to four-family homes resulted in mortgage originations (the balance being denied, withdrawn, or approved but not accepted by the borrower). By 2006, standards were indeed looser and 61 percent of applications for conventional mortgages resulted in originations. So what happened after the bust? Would it surprise you to learn that in 2010 63 percent of conventional mortgage applications resulted in originations? That’s right, for conventional mortgages, the conversion rate between applications and originations was actually higher last year than in either 2000 or 2006.

Now, I”m not sure that it’s easier. More loans may be approved, but from my experience the banks manage to find more hoops for a borrower to jump through, and consequently, fewer low quality borrowers actually try.

Read More: http://www.cnbc.com/id/45402953?__source=RSS*blog*&par=RSS

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Nevada Ranks # 46 in List of Best Run States

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Here’s another one of the “Best of” and “Worst of” lists that must fill journalists need for “product.” This time it is ranking the best of and the worst of the 50 states according to their arbitrary opinion.
These are the same kinds of lists that the politicians and the activist refer to when they seek to further pick the pockets of the public. Notice that they don’t include the per capita taxes the states collect.

FWIW, Nevada ranks #46 on the list:

46. Nevada
> State debt per capita: $1,690 (6th lowest)
> Pct. without health insurance: 22.6% (2nd highest)
> Pct. below poverty line: 13.0% (24th lowest)
> Unemployment: 13.4% (the highest)

Nevada has dropped five places in our rankings. This drop is due primarily to its credit downgrade this year from AA+ to AA. Surprisingly, the state has one of the lowest debts per capita in the country, at just $1,690 per person. However, it has other financial woes that make it a long-term risk. Nevada properties declined 44.5% in value between 2006 and 2010, the worst decline in the country. In October alone, one in every 180 homes was foreclosed upon, easily the worst rate in the country. The state also has the second lowest percentage of residents covered by health insurance and the highest unemployment rate in the country.

California ranks the worst, # 50, but you probably already knew that.

Read more (To save you time, Nevada is on page #6.).

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Canadians Think Las Vegas is Good Investment

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Canadians must think Las Vegas is a good place to invest. Else, why would they be putting their own money there?
The reality is that Candadians are investing in Las Vegas, big time. Do they know something that we don’t? Or, are we so close to the problem that we can’t see the opportunity.

“Where in Canada can you currently buy a $50,000 property that you can turn around and rent for $1,000 a month?” says real estate broker Steve Martel of Martels Real Estate Inc. in Ottawa, who specializes in the U.S. realty market.

This may be an idea for investing – or or may also be an indication of opportunities here in Reno.

What do you think?

read more: http://www.calgaryherald.com/business/Invest+real+estate/5611525/story.html

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State of Washington Sues B of A over Foreclosures

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The Washington state Attorney General filed suit against Bank of America over its foreclosure practices. Bank of America denies the charges.

Attorney General Rob McKenna alleged that a unit of Bank of America Corp. that handles foreclosures on behalf of the bank had improperly executed thousands of foreclosures over the last three years. The suit alleges that ReconTrust Co., a wholly owned BofA subsidiary that serves as a trustee in foreclosure sales, didn’t act in good faith when foreclosing on homeowners.

Washington is one of 27 so-called “non-judicial” states where, rather than going before a judge to foreclose, banks hire a trustee to carry out an administrative process that varies slightly from state to state. Trustees notify homeowners that they are in default and, if the borrower doesn’t become current or work out a modification, the trustee eventually carries out the foreclosure.

The lawsuit alleges that ReconTrust “committed unfair and deceptive acts” by failing to act as a neutral party between borrowers and lenders. ReconTrust “has failed to comply” with state foreclosure law “in each and every foreclosure it has conducted since at least June 12, 2008,” said the lawsuit.

The Washington lawsuit has listed a number of violations of Washington law and is asking for a court injunction against the foreclosures and fines for every violation.
Read more.

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Bank of America Will Accept Back-up Offer in Short Sale

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One of the problems with short sales is the amount of time they take to complete, often as much as 4 to 6 months, or more. The typical retail buyer is not willing nor able to wait around that long and the buyer then walks away from the transaction.

Short sales approval typically take 60-90 days \ after the buyer and seller have signed their contract and all the corresponding paperwork has been submitted to the bank. Closing then takes another 30 days or so. Most buyers don’t want to stick around for 120 days with the uncertainty that they don’t know if the bank will even agree to the short sale or if the terms of the agreement will be acceptable to the seller.The biggest challenge with short sales is to keep buyers interested in the property long enough to see the entire transaction through to the end.

Bank of America recently notified real estate agents that they can now substitute a new buyer without having to initiate a new short sale. This is in the case of the original buyer walking away from the deal. For home buyers and sellers reading this who may not be involved every day in dealing with short sales, this really big change in the real estate market.

This development should help to speed up short sales, if for no other reason that they no longer need to start over.

Read the B of A document: http://sdshortsaleexperts.com/virtualoffice_files//bank-of-america-back-up-offer.pdf

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Fannie Mae Discloses that it Pushed Foreclosures Over Mods

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It appears that Fannie Mae lied and was pushing foreclosures instead of loan modifications as they had originally insisted.

Fannie Mae has released papers and internal memos indicating that the government-controlled GSE has been pushing its lenders to opt for foreclosure instead of loan modifications and threatening to “charge a penalty to lenders who allowed foreclosures to wait too long before they were executed” . . . Ethical arguments about this policy aside, these memos are dated from the same time that Fannie Mae officials were testifying in congressional hearings that they “were doing everything in their power to prevent foreclosures.”

Nearly everything we see coming out of Washington is complete corruption and lies.

“I am thoroughly disgusted by the actions of Fannie Mae,” said Ingham County Register of Deeds Curtis Hertel, who is currently suing Fannie Mae and other lenders arguing that they failed to pay Ingham county millions of dollars in title transfer taxes. “What these internal documents show is that while Fannie Mae was being bailed out by taxpayers they were systematically pushing for citizens to be foreclosed. The reason for this is even worse. Right now we as taxpayers pick up the cost of every foreclosure, because we pay Fannie Mae’s loss in the foreclosure process. In other words they actually get paid more for a foreclosure than for a reasonable modification.”

Neeta Delaney, co-director of the Michigan Foreclosure Task Force, had a slightly more muted response.

“We see this on a daily basis. It is what we have been characterizing as the right hand not knowing what the left hand was doing,” she said. Her coalition represents nearly 200 groups with a stake in ending the foreclosure crisis and is working to push new foreclosure related legislation through the legislature. “It’s not new news (foreclosures during modification negotiations). But the documents are new news. These documents are implying a policy behind this. It’s not just the banks being overwhelmed.”

Read more:http://michiganmessenger.com/51716/officials-angered-over-fannie-mae-disclosures

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