Boise Meridian Eagle Idaho Real Estate - Homes Sales and Boise Investment Properties

Michael Hon, CEO, The Iron Eagle Realty Team Assoc. Broker, Silvercreek RG The Iron Eagle Realty Team is a Full Service Real Estate Company. Our mission is to assist our clients in the successful acquisition and sale of their personal homes and/or investment properties in the Boise Idaho Real Estate Market. We have successfully helped our clients with short sales, investment properties and foreclosed / bank owned properties in the Boise Idaho Real Estate Market.

Showing posts with label avoid foreclosure. Show all posts

Friday, March 08, 2013

Short sales impact our real estate market

This is a great article from TheHour.com regarding how to approach a short sale on your home.

Are you thinking of selling your home and the market value is less than you owe?

If so, then you are selling your home as a short sale. There still are many short sale homes on the market these days. The good thing is that most of the banks have figured out how to process the deals in a much quicker timeline than in the past. However, it still takes more time than a traditional transaction. A short sale is one where the net proceeds from the sale won't cover your total mortgage and closing costs and you don't have other sources of money to cover the deficiency.

A short sale will impact your credit score less than a foreclosure.

If you are thinking of selling your home and feel you may qualify for a short sale, follow the steps below before making any decisions on your own. The following advice is a compilation from several different sources including attorneys, mortgage professionals and accountants.

•Consider a loan modification first.

When you have made the decision to sell your property because of financial difficulties; first contact your lender to see if there are any programs to help you stay in your home.

Your lender may agree to a modification such as refinancing your loan at a lower interest rate or provide a different payment plan.
When a loan modification still isn't enough to relieve your financial problems, a short sale could be your best option if your property is worth less than the total mortgage you owe on it especially if you may have a financial hardship, such as a job loss or major medical bills. Contact your lender and see if they are willing to entertain a short sale.
•Hiring a qualified team is the difference between being successful or not.
The first step to a short sale is to hire a qualified real estate professional and a real estate attorney who specialize in short sales. Short sales have increased in the last few years, so make sure the real estate professional and attorney that you hire has had extensive experience and closed a lot of short sales.
A qualified real estate professional can provide you with a comparative market analysis (CMA). This will help set an appropriate listing price for your home, market the home, and get it sold. Place special language in the MLS that indicates your home is a short sale and that lender approval is needed. Ease the process of working with your lender or lenders. Negotiate the contract with the home buyers. Help you put together the short-sale package to send to your lender (or lenders, if you have more than one mortgage) for approval.
It's a good idea to gather documentation before any offers come in. Your lender or short sale specialist will give you a list of documents required to consider a short sale. The short-sale package that accompanies any offer typically must include a hardship letter detailing your financial situation and why you need the short sale. Also include a copy of the purchase contract and listing agreement, proof of your income and assets and copies of your federal income tax returns for the past two years. Buyers must be prepared for a lengthy waiting period.
Even if you're well organized and have all the documents in place, be prepared for a long process. Waiting for your lender's review of the short-sale package can take anywhere from several weeks to months. When the bank does finally respond, it can approve the short sale, make a counteroffer, or deny the short sale. The last two actions can lengthen the process or put you back at square one. Even if your lender does approve the short sale, it may take several months to close and may not be the end of all your financial concerns.
Keep in mind you may be asked by your lender to sign a promissory note agreeing to pay back the amount of your loan not paid off by the short sale. Every lender handles the situation differently. Any amount of your mortgage that is forgiven by your lender is typically considered income, and you may have to pay taxes on that amount. Consulting with your experienced short-sale team will get you the best possible advice for your situation. Bondi Realty Group LLC has the expertise you can count on.

The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.

Regards, Michael Hon, REALTOR®CEO, The Iron Eagle Realty Team
Associate Broker, Silvercreek Realty Group
Certified Short Sale Specialist®
Investment Property Consultant
Direct: 208.919.0458 Office: 208.939.9033 Fax: 208.514.1422
www.IronEagleRE.com Michael.Hon@IronEagleRE.com

Wednesday, January 23, 2013

Avoiding the Dirty Dozen Barriers to Short Sale Success

Here's great blog post on KCM by BRANDON BRITTINGHAM

Short sales often take three times longer than a traditional transaction and sometimes never close at all. By hiring an agent who knows to avoid these twelve barriers, the process can be less stressful.

1.) Poor short sale candidate

Establish objective criteria
Conduct an extensive interview with homeowner
Ascertain seller is motivated and cooperative
2.) Agent lacks familiarity with the lender’s requirements and procedures to complete the short sale

Harvest and maintain lender and investor guidelines
Secure individual forms required for each lender/servicer
3.) Title exam not obtained in the beginning

Identifies individuals on deed and mortgages
Determines all lien holders
4.) Incomplete package submitted to the lender/servicer

Focus on the quality of the package at time of submission
Detail orientation is critical
All docs completely executed
Complete package allows process to flow faster
5.) Short sale not begun prior to receiving a contract to purchase

Adds 30 to 60 additional days
Lender never looks at buyer contract until seller candidate is approved and market value has been determined
6.) Complete package not maintained throughout the short sale process

Must keep all required homeowner financial information current and forwarded to the servicer every 30 days
7.) Lack of communication with the lender

Most negotiators overwhelmed by the number of individual cases they are working on
Misunderstandings, loss of documents, and/or lack of familiarity with files are very common
Agent must continue to follow-up with the servicer twice a week to reduce unnecessary delays
8.) Poor record keeping /documentation by agent

High probability of changes in processing personnel
New person often lacks familiarity with case.
Has to rely on the quality of notes in the file
Information is often lost or missing
Agent’s role is to help fill in the gaps
9.) Professional relationship with the negotiator never established

Stressful environment
Lots of frustration
Lack of respect and trust are common
Begins with building rapport
Can be a big game changer
10.) Failure to meet BPO/Appraiser at the listing

Without a detailed inspection of the property inside and outside the value will be distorted
Meeting BPO at property provides great opportunity to share information that might not otherwise be discovered
11.) Fair market value dispute

Common in most markets
Negotiators lack current relevant information on most markets
Forced to make decisions based on the data provided by BPO and information in the lender package
Agent must be willing to provide additional current, detailed, relevant information (ie. local market, economy, demographics, and property condition) that can have an effect on value.

12.) Failure to “escalate” to higher authority when communication breaks down

Escalation is part of the short sale process
Escalating to a supervisor can be the key to moving forward
Upper levels of every lender’s short sale department are working toward one goal– avoiding another foreclosure
Avoiding these dozen pitfalls will increase your odds of success while reducing everyone’s time and stress.

The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.

Friday, January 04, 2013

Mortgage Debt Forgiveness Act Extended

Mortgage industry fares well in fiscal cliff deal, debt forgiveness law survives

The mortgage industry can breath a sigh of relief with the final fiscal cliff deal bringing back a popular tax break on mortgage insurance premiums and debt forgiveness for borrowers who go through a short-sale or some other type of debt reduction.

A topic that is still up for discussion and likely to surface later in the year is whether the popular mortgage interest tax deduction will be part of a long-term deficit reduction plan.

Still, the deal passed by the Senate and House on Jan. 1 is one that leaves room for hope in the housing market.

The American Taxpayer Relief Act of 2012 apparently extends a law that expired at the end of 2011, which allowed for the deductibility of mortgage insurance premiums, according to a research report from Isaac Boltansky with Compass Point Research & Trading. The law now applies to fiscal years 2012 and 2013.

"The law dictates that eligible borrowers who itemize their federal tax returns and have an adjusted gross income (AGI) of less than $100,000 per year can deduct 100% of their annual mortgage insurance premiums," Compass Point said.

"Certain borrowers with AGIs above $100,000 may benefit from the deductibility as well but are subject to a sliding scale. The tax break covers private mortgage insurance as well as mortgage insurance provided by the FHA, the VA, and the Rural Housing Service. In 2009, about 3.6 million taxpayers claimed the mortgage insurance deduction," the research firm added.

One of the more watched provisions of the fiscal cliff was the Mortgage Forgiveness Debt Relief Act of 2007, which was set to expire on Dec. 31.

The fiscal cliff deal extends it for another year, meaning homeowners who experience a debt reduction through mortgage principal forgiveness or a short sale are exempt from being taxed on the forgiven amount.

"The amount extends up to $2 million of debt forgiven on the homeowner's principal residence," Compass Point Research & Trading said. "For homeowner's to qualify, their debt must have been used to 'buy, build, or substantially improve' their principal residence and be secured by that residence. The law, which was passed in 2007 with a 5-year sunset provision, will now be in effect until Jan. 1, 2014."

Another minor win for housing is a provision tied to the government's plan to increase the capital gains tax rate from 15% to 20% for individuals who earn more than $400,000. While in theory, this is harder on higher-income homeowners, Compass Point sees a silver lining through an exclusion.

Compass Point notes the law "states that only gains of more than $250,000 for individuals ($500k for households) are subject to taxes on the excess portion of capital gains. Point being, in order for an individual homeowner to be impacted by the increased capital gains tax rate they would need to have an adjusted gross income above $400,000 and gain more than $250,000 from the sale of the property. Since this exclusion threshold remained intact, the impact of the capital gains tax increase is limited."

The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.

Thursday, October 04, 2012

Five Questions: Why Home Prices Are Rising

By Nick Timiraos
The Wall Street Journal
Home prices through July posted their largest year-to-date rise since 2005, according to the S&P/Case-Shiller index covering 20 major metropolitan areas.

Prices rose by 5.9% from the end of last year, according to the index, compared with a 0.4% gain for the same period last year and a 2.1% gain in 2010, when tax credits fueled a burst of home sales activity.

Are price gains limited to one segment of the market—say, foreclosed properties?

Not really. Data from real-estate firm CoreLogic show that the increases are being felt across all segments of the market. Overall median home prices in August were up by 12% from one year ago, as are median prices of existing homes that aren’t distressed sales.

Median prices of bank-owned foreclosures were up by 3%, while median prices were flat on short sales, where banks approve the sale of a house for less than the mortgage-debt that’s owed. Median prices of new homes, meanwhile, are up by 6%.

There are still a lot of foreclosures. How could prices be rising?

While foreclosures are still high by historic standards, the share of bank-owned foreclosures that are selling is down sharply over the past few years. Listings of foreclosed properties are down by 24% from one year ago and by more than 45% from two years ago.

While sales of foreclosed properties, which typically sell at a discount, have fallen by about 20% from one year ago, sales of traditional homes are up by 16% from one year ago, according to Ivy Zelman, chief executive at research firm Zelman & Associates. Prices, then, are rising not only because supplies of homes for sale are down, but demand is up.

Are banks strategically holding properties off of the market?

There’s little evidence that banks have seen an increase of marketable, or ready-for-sale, foreclosed properties sitting on their books. It’s true that there are still millions of properties that are in the foreclosure process or where borrowers have missed a couple of mortgage payments, and it’s unclear when or how aggressively banks will move those properties through the foreclosure process. In many cases, lenders and other mortgage companies that handle foreclosures have struggled to meet certain state requirements governing foreclosures. But the actual volumes of foreclosed properties that are sitting on banks books are down by around 24% from one year ago.

How large is the shadow inventory?

Overall, the “shadow inventory” of potential foreclosures is down by around 500,000 from the beginning of the year. Zelman & Associates put its estimate of shadow inventory that exceeds the typical level at around 2.9 million properties.

More In Shadow Inventory

Shadow inventory, however, is falling more slowly than expected, according to estimates from Zelman, because banks have been taking longer to process foreclosures and less successful at completing loan modifications. Zelman now expects shadow inventory to remain steady this year before falling by 20% to 2.3 million by the end of next year. Earlier estimates had put shadow inventory at 2.6 million and 1.8 million units at the end of this year and next, respectively.

Are home prices going to fall further?

Home prices typically strengthen during the seasonally strong spring and summer months, when there are more people shopping for homes. They weaken in the fall and winter. The key, then, is to monitor the year-over-year change in home prices. Prices in July were 1.2% above their year-ago levels, according to Case-Shiller, with 16 of 20 cities posting year-over-year increases.

If banks continue to push more foreclosure alternatives at a measured pace and if housing demand remains at its current levels, then “home prices are easily past their bottom and are approaching the self-reinforcing portion of the cycle,” wrote Ms. Zelman in a recent report.

The biggest risks to her forecast, she says, are weakness in job growth and the broader economy and tighter credit standards brought on by forthcoming mortgage regulations.

The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.

Tuesday, October 02, 2012

Merry X-Mas – BofA Just Wiped Out Your 2nd Lien

Friday, August 24, 2012

New Short Sale Guidelines for GSEs Will Make Process Easier

BY: ESTHER CHO
DSNEWS.COM

Starting November 1, 2012, Fannie Mae and Freddie Mac will implement new short sale guidelines to make the approval process easier for eligible borrowers.

“These new guidelines demonstrate FHFA’s and Fannie Mae’s and Freddie Mac’s commitment to enhancing and streamlining processes to avoid foreclosure and stabilize communities,” said
FHFA Acting Director Edward J. DeMarco in a statement. “The new standard short sale program will also provide relief to those underwater borrowers who need to relocate more than 50 miles for a job.”

The changes are part of the FHFA’s Servicing Alignment Initiative and will require a streamlined approach with documents, leading to a reduction in documentation requirements. For example, borrowers who are 90 days or more delinquent and have a credit score lower than 620 will no longer be required to provide documentation for their hardship.

The GSEs will also waive their right to pursue deficiency judgments. Borrowers with sufficient income or assets can make cash contributions or sign promissory notes instead.

One major barrier that is also being addressed is the issue with second lien holders. To prevent second lien holders from stalling the short sale process, the GSEs will offer up to $6,000.

The new guidelines will also enable servicers to approve a short sale for borrowers who are not in default but face certain hardships including the death of a borrower or co-borrower, divorce or legal separation, illness or disability or a distant employment transfer.

In addition, all servicers will have the authority to approve and complete short sales that follow the requirements without first going to the GSEs for approval.

Provisions were also created for military personnel with Permanent Change of Station (PCS) orders. Servicemembers who are required to relocate will automatically be eligible for for short sales even if they are current. They also won’t be obligated to contribute funds to pay for the remaining deficiency.

“Short sales have become an increasingly important tool in preventing foreclosures and stabilizing communities,” said Leslie Peeler, SVP, National Servicing Organization, Fannie Mae. “We want to help as many homeowners avoid foreclosure as possible. It is vital that servicers, junior lien holders and mortgage insurers step up to the plate with us.”

Tracy Mooney, SVP of Single-Family Servicing and REO at Freddie Mac, said, “These changes will make it clear that Freddie Mac servicers have the authority to approve short sales for more borrowers facing the most frequently seen hardships. These changes will further empower the industry to minimize foreclosures and help Freddie Mac in its mission to minimize credit losses and fortify a national housing recovery.”

Fannie Mae will send the announcement for the new changes to servicers Wednesday. Freddie Mac sent their announcement Tuesday.

In April, the GSEs also announced they were setting requirements to have a decision on a short sale offer made within 30-60 days.

The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.

Tuesday, August 21, 2012

REO inventories drop even as banks hold on to them longer

Foreclosure starts drop in Arizona, Nevada, Oregon
BY INMAN NEWS, WEDNESDAY, AUGUST 15, 2012.
Inman News®

Inventories of bank-owned properties fell year over year across four Western states in July even as lenders took longer to get those properties off their books, according to the latest report from real estate data company ForeclosureRadar.

The report covers foreclosure trends in California, Arizona, Nevada, Washington and Oregon. Of the five states, only Oregon did not see its bank-owned inventory drop last month.

In California, the number of homes repossessed by lenders but not yet resold, known as bank-owned or real estate owned (REO) inventory, was down 36.4 percent to 66,000 properties last month. Banks sold REOs in 283 days on average, up from 232 days in July 2011. By contrast, homes bought by third parties at auction, usually investors, were resold in an average 138 days, up from 128 days a year ago.

Nonetheless, there are some signs the pipeline of foreclosures in the Golden State is speeding up a bit. Foreclosure starts rose 12.3 percent year over year in July to 21,175. The average number of days between the initial notice of default and the end of the foreclosure process (with the property either sold to a third party or repossessed by the bank) was 276 days last month (equivalent to about nine months), down from 310 days (about 10 months) a year ago.

Among the California homes in the foreclosure process whose fates were decided in July, most (10,398) experienced a cancellation of the process due to a successful loan modification or short sale, among other possible reasons. The number of properties that went back to the bank as REOs declined 54.2 percent on an annual basis to 4,512. Foreclosure sales to third parties fell 6.6 percent to 3,269.

In Arizona, foreclosure starts fell 28.2 percent year over year in July, to 4,433. Foreclosure cancellations were down 4.4 percent annually, to 3,575. The number of properties that went back to the bank as REOs decreased 33.8 percent year over year, to 2,191. Those sold to third parties rose 3 percent on an annual basis, to 1,630.

Arizona's REO inventory fell 38.1 percent last month, to 14,784. While the time to foreclose declined to an average 136 days from 175 days in July 2011, the time between when the bank took back the property and the property was resold rose a whopping 64.9 percent, to an average 244 days in July. Third parties resold properties in less than half that time, 107 days, up from 94 days a year ago.

Foreclosure activity in Nevada has slowed to a trickle, likely as a result of a Nevada state law that went into effect in October designed to crack down on documentation irregularities by foreclosing lenders.

In July, Nevada foreclosure starts were down 61.8 percent, to 1,618, compared with 4,235 a year ago. Foreclosure cancellations were down to 800, a nearly 60 percent drop from July 2011, but the number of properties becoming REOs dropped even more precipitously, 77.8 percent, to only 394 properties. The number of properties sold to third parties on the courthouse steps fell 34.4 percent, to 429.

The state's REO inventory was down 63.8 percent to 5,541 in July with the number of homes in the foreclosure pipeline dropping by more than half year over year. It took nearly 46 percent longer to foreclose on a property last month than it did in July 2011: an average of 471 days -- the equivalent of nearly 16 months. Banks also took considerably longer to sell homes once they'd repossessed them -- an average 221 days, up from 154 days a year ago. Third parties resold in an average 133 days, up from 98 days.

In Washington state, time to foreclose was virtually unchanged from a year ago in July: 102 days on average. Foreclosure starts were up 13.1 percent to 2,527. Cancellations fell 59.5 percent to 601. The number of properties that went back to the bank as REOs fell 67.1 percent to 595. Foreclosure sales to third parties fell 36 percent to 151.

As in the aforementioned states, REO inventory in Washington fell substantially last month: down 42.2 percent to 6,554. Banks took an average of 249 days to resell an REO property, up 25.9 percent. By contrast, third parties took an average 107 days to resell, down 24.1 percent.

In Oregon, foreclosure starts were down 58.6 percent year over year in July, to 426.

"This is most likely related to both the new Oregon law, SB 1552, that gives homeowners at risk of default, or in default, the right to request mediation to avoid foreclosure, as well as the Oregon Court of Appeals ruling that may force some lenders to proceed judicially with foreclosures," the report said.

"It is still not clear whether this is a temporary decline or part of a move toward judicial foreclosure in Oregon."

Nonetheless, time to foreclose fell to an average of 143 days from 162 days a year ago. Foreclosure cancellations in Oregon fell 11.9 percent on an annual basis last month, to 761 properties. At the same time, the number of properties reverting to REOs rose 93.6 percent year over year, to 395. Sales to third parties rose 73.7 percent, to 66 properties.

In contrast to the other four states in the ForeclosureRadar report, REO inventory in Oregon rose in July, up 39.7 percent to 3,153 properties. Banks also resold REOs at a quicker pace -- an average of 203 days, down from 219 a year ago. Third parties resold in an average of 79 days, up from 66 in July 2011.

The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.

Tuesday, August 14, 2012

The One Housing Solution Left: Mass Mortgage Refinancing

By JOSEPH E. STIGLITZ and MARK ZANDI
Published: August 12, 2012
NYTimes.com

MORE than four million Americans have lost their homes since the housing bubble began bursting six years ago. An additional 3.5 million homeowners are in the foreclosure process or are so delinquent on payments that they will be soon. With 13.5 million homeowners underwater — they owe more than their home is now worth — the odds are high that many millions more will lose their homes.

Housing remains the biggest impediment to economic recovery, yet Washington seems paralyzed. While the Obama administration’s housing policies have fallen short, Mitt Romney hasn’t offered any meaningful new proposals to aid distressed or underwater homeowners.

Late last month, the top regulator overseeing Fannie Mae and Freddie Mac blocked a plan backed by the Obama administration to let the companies forgive some of the mortgage debt owed by stressed homeowners. While half a million homeowners could be helped with a principal writedown, the regulator, Edward J. DeMarco, argued (we believe incorrectly) that helping some homeowners might cause others who are paying on their loans to stop so that they also could get their mortgages reduced.

With principal writedown no longer an option, the government needs to find a new way to facilitate mass mortgage refinancings. With rates at record lows, refinancing would allow homeowners to significantly reduce their monthly payments, freeing up money to spend on other things. A mass refinancing program would work like a potent tax cut.

Refinancing would also significantly reduce the chance of default for underwater homeowners. With fewer losses from past loans burdening their balance sheets, lenders could make more new loans, and communities plagued by mass foreclosures might see relief from blight.

Well over half of all American homeowners with mortgages are paying rates that would appear to make them excellent candidates to refinance. Many of those with stable jobs, good credit scores and even a modest amount of home equity have already done so, taking out 30-year loans at rates around 3.5 percent, some of the lowest rates since the 1950s. But many others can’t refinance because the collapse in house prices has wiped out their home equity.

Senator Jeff Merkley, an Oregon Democrat, has proposed a remedy. Under his plan, called Rebuilding American Homeownership, underwater homeowners who are current on their payments and meet other requirements would have the option to refinance to either lower their monthly payments or pay down their loans and rebuild equity.

A government-financed trust would be used to buy the mortgages of homeowners who had refinanced at an interest rate that was about 2 percentage points more than the record-low Treasury rates at which the government borrows. This would generate enough interest income to cover the costs of any defaults, administration of the trust and other expenses. Families would have three years to refinance; after that, the trust would stop buying loans and eventually wind itself down as homeowners repaid their loans.

Homeowners would see lower mortgage payments and rebuild equity more quickly. Taxpayers would get their money back, with interest, and would gain further as a stronger economy lifted tax revenues. Banks and other mortgage investors would get potentially troubled loans off their books. Some banks won’t like losing the large amounts of interest income they are earning on their current mortgages, but if the refinancing market were working properly these loans would have been refinanced long ago.

If the program was very successful, we envisage that two million outstanding loans could be placed in a Rebuilding American Homeownership trust at its peak. If the average mortgage balance was $150,000, then at the peak there would be $300 billion outstanding.

The federal government could finance the plan directly, through the Federal Housing Administration, or indirectly, through the Federal Home Loan Banks, which offer government-backed credit. Or the Federal Reserve could underwrite the plan; the central bank’s chairman, Ben S. Bernanke, recently talked about the Fed’s doing something akin to the Bank of England’s new Funding for Lending program, which offers incentives to banks to increase lending to households and nonfinancial businesses.

Opponents of additional borrowing or Fed lending will say that a program like this is an unacceptable risk, but the greater risk is to do nothing and let the housing market continue to hold back the economy.

Mr. Merkley’s plan resembles the Obama administration’s Home Affordable Refinance Plan, or HARP, which was designed to help underwater homeowners refinance loans backed by Fannie and Freddie. It has made possible 1.4 million refinancings, far fewer than the goal set in 2009 of 3 million to 4 million. The administration has made some improvements to HARP and proposed others. But the Merkley plan has the potential to go further, reaching the 20 million households with mortgages that aren’t backed by Fannie or Freddie.

The Merkley plan has a successful precedent in the Home Owners’ Loan Corporation, established in 1933. It swept more than a million Americans out of foreclosure and into the long-term, stable mortgages that would become the hallmark of the middle class during the 1950s and ’60s. It’s time to revive this idea.

Since the Great Recession began almost five years ago, housing has been at the heart of our economic woes. If we do nothing, the problem will eventually resolve itself, but only with significant pain and a long wait. Mr. Merkley’s plan would speed the healing.

Joseph E. Stiglitz is a professor of economics at Columbia. Mark Zandi is the chief economist at Moody’s Analytics.

Thursday, May 03, 2012

Foreclosures Down to 69,000 in March, Inventory Also Down

DSNEWS.com
BY: ESTHER CHO

Year-over-year, the number of completed foreclosures decreased about 19 percent to 69,000 in March 2012 compared to 85,000 in March 2011, according to CoreLogic’s National Foreclosure Report for March. Month-over-month, with the number of completed foreclosures in February 2012 at 66,000, foreclosures increased about 4.5 percent in March 2012.

On a quarterly basis, foreclosures decreased to 198,000 in the first quarter of 2012 compared to 232,000 through the same quarter a year ago.

Overall, since the start of the financial crisis in September 2008, there have been approximately 3.5 million completed foreclosures.

In addition to the yearly and quarterly decreases in completed foreclosures, the number of loans in the foreclosure inventory decreased by nearly 6 percent, or 100,000, in March 2012 compared to the year before.
“Since the foreclosure inventory is also coming down, this suggests that loan modifications, short sales, deeds-in-lieu are increasingly being used as an alternative to foreclosures to clear distressed assets in our communities. This is what was envisioned with the recent National Foreclosure Settlement, and can often be a better outcome for both borrowers and investors,” said Anand Nallathambi, CEO of CoreLogic.

Out of all homes with a mortgage, approximately 1.4 million homes, or 3.4 percent were in the national foreclosure inventory as of March 2012 compared to 1.5 million, or 3.5 percent, the same month a year ago, and 1.4 million, or 3.4 percent, in the prior month of February.

Delinquencies are also down, with the share of borrowers nationally that were more than 90 days late on their mortgage payment, including homes in foreclosure and real estate owned (REO) assets, dropping to 7 percent in March 2012 from 7.5 percent a year ago, and remained unchanged compared to the prior month.
“The overall delinquency level was unchanged in March, remaining at its lowest point since July 2009,” said Mark Fleming, CoreLogic’s chief economist.

The distressed clearing ratio for March was up at 0.81 compared to 0.76 in February 2012. A higher ratio indicates a faster pace of REO sales relative to the pace of completed foreclosures.

As for individual states, strides were more notably made with non-judicial states.

“Non-judicial foreclosure markets like Nevada, Arizona, and California are experiencing significant improvements in their shares of delinquent borrowers. Some judicial foreclosure states are also improving, like Florida, but not to the extent of non-judicial markets,” said Fleming.

Year-over-year, the percentage of 90-plus delinquencies in Nevada decreased 3.7, while in Arizona the drop was 3.2 percent and in California 2.2 percent. Judicial state Florida saw a 1 percent decrease in its percentage of delinquent borrowers.

Highest % of Foreclosure Inventory
Florida (12.1 percent)
New Jersey (6.6 percent)
Illinois (5.4 percent)
Nevada (4.9 percent)
New York (4.9 percent)

Lowest % of Foreclosure Inventory
Wyoming (0.7 percent)
Alaska (0.8 percent)
North Dakota (0.8 percent)
Nebraska (1.1 percent)
South Dakota (1.4 percent)

Five States with the Most Foreclosures
(Over 12 months ending in March 2012)
California (150,000)
Florida (92,000)
Michigan (62,000)
Arizona (58,000)
Texas (57,000)

The five states account for 49.1 percent of all completed foreclosures nationally.
CoreLogic is a provider of consumer, financial and property information, analytics, and services to businesses and the government.

The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.

Monday, April 23, 2012

Bank-owned homes being held off the market

Here is an interesting article from the Idaho Business Review. There are currently 462 total REO's on the MLS,63 in Ada County and 133 in Canyon County. These are much lower than what we had on the market last year.

by Brad Carlson Idaho Business Review Published: April 18,2012 Time posted: 9:52 am

Some market watchers say banks aren’t immediately listing foreclosed homes for sale, in part to keep the market from being flooded with distressed properties. The number of bank-owned homes listed for sale through southwest Idaho’s multiple listing service dropped 17.3 percent from February 1 through the end of March, Idaho Data Providers said in a report. Listings of bank “real estate owned” homes, or REOs, dropped from 1,176 to 973 during the period. “This fact is worth mentioning since foreclosure sales are still occurring, and the vast majority of properties are going back to the lender, but there haven’t been that many REO sales to account for the decline,” Idaho Data Providers President Charlie Nate said in the report. “This is evidence that lenders are holding REOs off the market and probably renting them for a while to help keep the market stable.” The number of REOs listed for sale in the database of the Boise-based Intermountain MLS is short of the number of properties going back to banks in foreclosure actions, Nate said in an interview. His company tracks default and foreclosure filings as well as listings of distressed properties for sale. “They are doing that so they don’t further depress the market,” Nate said. “It’s just kind of a controlled thing.” Lance Churchill is a Meridian-based attorney who owns Frontline Realty, which buys and sells investment real estate. The company mainly handles residential properties, buying them at foreclosure auctions. Comparison of bank “real estate owned” homes to short sales listed for sale in the Boise-based Intermountain MLS. In a short sale, the lender agrees to accept a price below what is owed. Courtesy Idaho Data Providers. Banks continue to take back houses through foreclosure but are holding some off the market, Churchill said. Fannie Mae, Freddie Mac and lenders have started programs in which they rent bank-owned homes to residents instead of selling the homes immediately, which helps keep the market from being flooded with REO properties, Churchill said. Fannie and Freddie are government-sponsored enterprises that buy mortgages from lenders. “I’ve certainly noticed the REOs I handle are down,” said Remax Capital City Realtor Blake Mayes, who concentrates on REOs. “Certainly for me, inventory is down from what it was last year.” One Boise-area bank that is not holding properties off the market is Bank of the Cascades. “Anything we have in Other Real Estate (Owned), we have listed for sale,” Bank of the Cascades Idaho Region President Mike Mooney said. “Our OREO numbers are down pretty dramatically in the last six months and continue to trend downward.” Bank of the Cascades owns fewer homes in part because the economy and demand for housing are improving, and low interest rates are helping buyers, Mooney said. “We don’t want to own property; we want to make loans,” he said. “It’s definitely getting better.” The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.

Wednesday, March 21, 2012

Ada County housing market rallies

There was a great article in the last Sunday's Idaho Statesman. Our real estate market in Boise is finally going in the right direction. Here are some exerts from the article:

"Agents say buyer activity has picked up in several price ranges and property types, at least in Ada County. Ada County sales rose 13.4 percent to 439 in February, compared with 387 in the same month last year, according to the Intermountain Multiple Listing Service. In Canyon County, they dipped 16 percent to 195 from 234.

“This is the strongest February sales we’ve had since 2007” in Ada County, said Marc Lebowitz, executive officer of the Ada County Realtors Association."

"Across the Valley, the number of homes listed for sale remains at a five-year low: 2,901 in February. The small supply is helping to drive prices up and leading to multiple offers per property that match or exceed the asking price, real estate professionals say.

“The agents in my office say they’re seeing three, four and five offers on one property,” said an agent at Coldwell Banker Tomlinson Group.

In Boise, 928 single-family homes have been listed for sale since January, while 1,080 homes went under contract to sell or were sold. Sales are overtaking listings.

That means the market is turning.

“Buyers are now understanding that prices aren’t going any lower,” she said. “We’re on the cusp of something. The hardest thing right now is getting people to list their homes.”

Agents consider a six-month supply of homes at current selling rates a balanced market, meaning neither buyer nor seller has the advantage. Boise homes in the $200,000-$300,000 range are at a 5.5-month supply"

If you are looking to sell your home, now is the time!

Link to Statesman Article

The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.

Regards, Michael Hon, REALTOR®
CEO, The Iron Eagle Realty Team
Associate Broker, Silvercreek Realty Group
Certified Short Sale Specialist®
Investment Property Consultant
Direct: 208.919.0458 Office: 208.939.9033 Fax: 208.514.1422
www.IronEagleRE.com Michael.Hon@IronEagleRE.com

Monday, February 06, 2012

Report: Freddie Mac bets against homeowner refinancings

They are all CRIMINALS!!!

NPR and ProPublica investigation shines light on investment practices
BY INMAN NEWS, MONDAY, JANUARY 30, 2012.
Inman News®

In 2010 and 2011, mortgage giant Freddie Mac invested billions of dollars on bets that homeowners with high-interest mortgages would not be able to refinance at today's lower interest rates, according to a joint investigation conducted by NPR and ProPublica, a nonprofit, independent news agency.

While legal, the bets appear to be in direct conflict with the taxpayer-backed company's public mission, as stated on its website, "to stabilize the nation's residential mortgage markets and expand opportunities for homeownership and affordable rental housing," the news agencies said, noting that refinancing terms have been getting more restrictive of late and include higher fees and new rules that prevent some homeowners from taking advantage of historically low interest rates.

Freddie Mac is regulated by the Federal Housing Finance Agency (FHFA). Officials at both Freddie Mac and FHFA repeatedly declined to comment on the specific transactions, the news agencies said, though Freddie Mac did say that its employees who make investment decisions are "walled off" from those who determine the terms under which homeowners can get loans.

And in a written statement, Freddie Mac said it "is actively supporting efforts for borrowers to realize the benefits of refinancing their mortgages to lower rates," noting that it refinanced loans for hundreds of thousands of borrowers in 2011, according to the news agencies' report.

HousingWire writer Jacob Gaffney accused NPR and ProPublic of conducting a "witch hunt" of Freddie Mac.

"Who in their right mind would try to counter NPR and ProPublica articles that clearly depict the evil mortgage market behemoth undercutting homeownership initiatives and doing the unthinkable: Trying to earn money for bond investors?" Gaffney said.

Hate to say it NPR and ProPublica, but the same thing is happening at Ginnie Mae and Fannie Mae, and just about everywhere a home is bought, sold and financed."

He added, "The very federal conservatorship status that both Fannie and Freddie are under is designed to protect their assets. That means keeping performing loans right where they are -- in a position that most efficiently monetizes loans for investors" -- one of the biggest of which is the U.S. government, he said.

ProPublica characterized the investments by Freddie Mac as a conflict at the heart of the company: "In addition to being an instrument of government policy dedicated to making home loans more accessible, Freddie also has giant investment portfolios and could lose substantial amounts of money if too many borrowers refinance."

Freddie Mac, as does fellow government-sponsored enterprise Fannie Mae, repurchases loans from lenders, allowing them to keep making more loans with minimal risk. The report by NPR and ProPublica contends that in 2010 and 2011 Freddie Mac didn't just repurchase and hold loans, however -- the company reportedly also packaged hundreds of thousands of loans, chopping the securities up into two main slices:

1. One that is low-risk, and based on homeowners paying the principal on their mortgage.

2. The other, known as an "inverse floater," that is higher-risk and based on all of the interest owed on the entire bundle.

Freddie Mac would sell the low-risk slice and keep the higher-risk slice, the news agencies said.

"That riskiest investment pays out a lucrative stream of interest payments. But Freddie's slice also has all the so-called 'prepayment risk' associated with that (bundle) of loans. So if lots of people 'prepay' their old loans and refinance into new, cheaper ones, then Freddie Mac starts to lose money. If people can't refinance, then Freddie wins because it continues to receive that flow of older, higher interest payments," NPR said.

The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.

PS: We've Helped More Buyers and Sellers than 99.8% of any Local Realtor

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Regards, Michael Hon, REALTOR®
CEO, The Iron Eagle Realty Team
Associate Broker, Silvercreek Realty Group
Certified Short Sale Specialist®
Investment Property Consultant
Direct: 208.919.0458 Office: 208.939.9033 Fax: 208.514.1422
www.IronEagleRE.com Michael.Hon@IronEagleRE.com

Wednesday, February 01, 2012

U.S. regulator launches foreclosure sales plan

(Reuters) - The regulator for mortgage finance companies Fannie Mae and Freddie Mac said on Wednesday investors could now sign up to pre-qualify to bid on foreclosed properties held by the government-controlled firms.

Those investors meeting the qualifications set by the Federal Housing Finance Agency could purchase homes and then convert them into rental units under the new program. They would be required to use the properties as rentals for a specific number of years.

Government-run Fannie Mae, Freddie Mac and the Federal Housing Administration own a large portion of the country's foreclosed properties. As that inventory is expected to swell, the federal program is aimed to clear the backlog of distressed properties that has flooded the market and depressed prices, while at the same time meeting the increased demands of renters.

The regulator said it will announce the first transaction during a pilot phase of the so-called REO initiative in the "near term." Fannie Mae will offer for sale pools of various types of assets in the first pilot program, including rental properties, vacant properties and non-performing loans with a focus on the hardest-hit areas.

"This is an important step toward increasing private investment in foreclosed properties to maximize value and stabilize communities," said FHFA acting director Edward DeMarco.

Later Wednesday, President Barack Obama will announce a package of proposals to help the ailing housing market, including a way to help more borrowers refinance at record low borrowing costs.

(Reporting by Margaret Chadbourn; Editing by Andrea Ricci)

The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.

Friday, January 27, 2012

U.S. growth quickens, but speed bumps ahead

By Lucia Mutikani
WASHINGTON | Fri Jan 27, 2012 12:53pm EST
(Reuters) - The U.S. economy grew at its fastest pace in 1-1/2 years in the fourth quarter of 2011, but a strong rebuilding of stocks by businesses and a slower pace of business spending hinted at softer growth early this year.

U.S. gross domestic product expanded at a 2.8 percent annual rate, the Commerce Department said on Friday, a sharp acceleration from the 1.8 percent clip of the prior three months and the quickest pace since the second quarter of 2010.

It was, however, a touch below economists expectations in a Reuters poll for a 3 percent rate, and two-thirds of rise in output was due to the build-up in business inventories.

Soft underlying demand and a sharp slowing in core inflation supported the Federal Reserve's decision to keep in place an ultra easy monetary policy to nurse the recovery.

"We do not expect growth to accelerate meaningfully from its current pace," said Michelle Girard, a senior economist at RBS in Stamford, Connecticut. She said Fed officials would focused on slack in the economy.

Stocks on Wall Street opened lower as investors worried about the composition of growth, while Treasury debt prices were little changed. The dollar fell against a basket of currencies.

INVENTORIES REBOUND

The economy in the fourth quarter got a temporary boost from the rebuilding of business inventories, which logged the biggest increase since the third quarter of 2010. The buildup followed a third quarter decline that was the first since late 2009.

Excluding inventories, the economy grew at a tepid 0.8 percent rate, a sharp step-down from the prior period's 3.2 percent pace and a sign of weak domestic demand.

The robust stock accumulation suggests the recovery will lose a step in early 2012 as businesses are unlikely to keep building inventories at the same rate.

Growth in business spending on capital goods was the slowest since 2009, a sign the debt crisis in Europe was starting to take its toll and another hint of weakness ahead.

The Fed on Wednesday said it expected to keep interest rates at rock bottom levels at least through late 2014, and Chairman Ben Bernanke said the central bank was mulling further asset purchases to speed the recovery.

The central bank warned the economy still faced big risks, a suggestion the euro zone debt crisis could still hit hard.

"We're still repairing the damage done by the financial crisis. On top of that we face a more challenging world. We have a lot of challenges ahead in the United States," U.S. Treasury Secretary Timothy Geithner said at the World Economic Forum in Davos.

Prospects of sluggish growth could hurt President Barack Obama's chances of re-election in November.

The economy grew 1.7 percent in 2011 after expanding 3 percent the prior year, and the unemployment stood at a still-high 8.5 percent in December.

AUTOS PROP UP CONSUMER SPENDING

Consumer spending, which accounts for about 70 percent of U.S. economic activity, stepped up to a 2 percent rate from the third-quarter's 1.7 percent pace - largely driven by pent-up demand for motor vehicles.

The Japanese earthquake and tsunami had disrupted supplies early last year, leaving showrooms bereft of popular models.

Consumers also benefited from a moderation in inflation.

A price index for personal spending rose at a 0.7 percent rate in the fourth-quarter, the slowest increase in 1-1/2 years, after rising at a 2.3 percent pace in the July-September period.

A core inflation measure, which strips out food and energy costs, increased at a 1.1 percent rate after rising 2.1 percent in the third quarter. The slowdown could concern the Fed, which wants the measure closer to their 2 percent inflation target.

"Clearly, much work remains to achieve the Fed's dual mandate of maximum sustainable employment in the context of price stability," New York Federal Reserve Bank President William Dudley told reporters.

SLUGGISH INCOME GROWTH

High unemployment has led to sluggish income growth, which in turn has prompted households to tap savings and credit cards to fund their purchases.

Still, spending is unlikely to be a drag on growth, given that consumer sentiment is on the mend, as indicated by another report on Friday.

"Though the unemployment rate has improved, the jobs market remains a major challenge. Part of the decline in the unemployment rate is due to the fact that ... people have stopped looking for work," said Adolfo Laurenti, deputy chief economist at Mesirow Financial in Chicago.

"The high level of people out of the workforce and underemployed people show there isn't really much income generation to contribute to a better spending pattern."

A sustained growth pace of at least 3 percent would likely be needed to make noticeable headway in absorbing the unemployed and those who have given up the search for work.

Business spending grew at a sluggish 1.7 percent rate in the fourth quarter, pulling back sharply from the third-quarter's 15.7 percent pace.

Though exports held up, an increase in imports left a trade gap that chipped growth.

Unseasonably mild winter weather helped home construction post its fastest growth pace since the second quarter of 2010, with much of the increase going to meet rising demand for rental apartments.

Government spending shrank for a fifth consecutive quarter, reflecting a large decline in defense and still weak state and local government outlays. A bounceback could support growth at the start of the year.

(Reporting by Lucia Mutikani; Editing by Neil Stempleman and Tim Ahmann)

The Iron Eagle Realty Team's mission is to assist you, our client, in the sale and acquisition of real estate properties in the state of Idaho, specifically the Boise Idaho Real Estate Market. Whether you are buying or selling a home, whether it is a foreclosure, short sale or equity property, we handle our customers and clients with empathy and honest truths so they can make informed decisions as they advance in the process of buying and selling real estate that meet specific needs.