Fremont Real Estate Blog

Here’s the story . http://www.dsnews.com/articles/bofa-to-offer-principal-forgiveness-some-underwater-homeowners-2010-03-24

FTC Rule Bans Up-Front Fees for Modifications DS News just informed me, that "The Federal Trade Commission has proposed a new rule that would prohibit third parties, including loan modification specialists and loss mitigation attorneys, from collecting payment for foreclosure prevention services until after they obtain a documented offer from a lender or servicer for a modification or other form of mortgage relief." I think this is great news. You know I'm against anyone paying anyone for a loan modifification, since it's something anyone can do on their on. However, if they choose to be lazy, than ayone taking on the task should only be paid for accomplishing a loan mod, not just faxing over income and asset documentation. I'll be keeping my eye on this one. Cheers, Sunil www.sunilsethi.com

I was thinking after the holidays, the lenders might lose their soft heart or patience with various plans to keep home owners in their home. As I've mentioned before if we don't start seeing more inventory this quarter, I don't see why it'll change later for buyers. On a positive for buyers, I did see two examples of short sales attempted and rejected by the lender. One of which should be going to sale today. There are still a lot of buyers, who’d like to buy while mortgage interest rates are low. The Obama administration needs to let the natural foreclosure cycle happen and let buyers into homes who can afford to make the payments on their mortgages. An example of a property that should have been foreclosed on months earler: There was one up for sale today in Southwycke Ter., Fremont. The home is vacant, and by the looks has been vacant for a long time. The roof is leaking and the water has caused mold to set in. The home is being neglected and should have been forecl...

Fannie Mae (which is owned by Uncle Sam), will be implementing a plan for homeowners who turnover their deed to be able to rent their place back. Prospective renters must show that they can afford to pay the new market rental rate and must be able to document that the rental payment is no more than 31 percent of their gross income. So I wonder who’s going to be their property manager? This could be an opportunity to grab some government pork. Read more here http://www.dsnews.com/articles/fannie-mae-becomes-landlord-with-new-deed-for-lease-program-2009-11-05 -sunil SMA REALTY Sunil Sethi / Broker, President, REALTOR, MBA, CPA / SMA Realty 38350 Fremont Blvd. #202 / Fremont, CA 94536 Office 510 793 8600 / Mobile 510 388 2436 My Bio: http://sunilsethi.com/about_me.htm Personal: http://www.sunilsethi.com My blog: http://fremontrealestate.blogspot.com/ LinkedIn: http://www.linkedin.com/in/fremontrealtor CA DRE#: 01173766

The title says it all. Share this story with all. http://www.dsnews.com/articles/california-loan-mod-agents-kidnapped-tortured-for-not-saving-home-2009-10-29 -sunil SMA REALTY Sunil Sethi / Broker, Preisent, REALTOR, MBA, CPA / SMA Realty 38350 Fremont Blvd. #202 / Fremont, CA 94536 Office 510 793 8600 / Mobile 510 388 2436 / Fax 510 431 9046 My Bio: http://sunilsethi.com/about_me.htm Personal: http://www.sunilsethi.com My blog: http://fremontrealestate.blogspot.com/ LinkedIn: http://www.linkedin.com/in/fremontrealtor CA DRE#: 01173766

Hard to believe the IRS is actually trying to help people, do better financially. They've come out with a new form that will provide a short copy of what you filed on your tax return Form 1040. The IRS specifically cited the form’s use for applications under the administration’s Home Affordable Modification Program ( HAMP ). Here's the link to an article for more information.

10% of loan mods that occurred in the last quarter involved forbearance (where a portion is set aside on which no interest is charged but has to be paid off upon sale) or principal reduction. I also got a chance to meet SVP’s at BofA, Chase, and Wells Fargo at the C.A.R. show this weekend, and they all said they’re getting better at it. However the decision to grant a loan modification is still based on a business decision. That does the Net Present Value of the new Loan exceed what the property would net the investor in foreclosure. If yes, than loan modification is the answer. Also both the BofA and WF rep confirmed the recent increase in deferment of foreclosures is because the Obama government (ala Treasury Dept), is pressuring the banks to attempt loan modifications if requested. One other interesting tid bit was I got was even though currently the loan mod decision is a business decision, this could change in the future and will depend what direction the government pushes the ban...

C.A.R. just clarified what SB306 means. I know I was pretty excited when someone 1st sent me news about SB306, and was puzzled why it wasn't getting more press. Initially it was explained to me as requiring banks to give a decision on a short sale request in 21 days. Well that's not ture. See C.A.R.'s interpretation below: --------------------------------------------------- NO NEW 21-DAY TURNAROUND REQUIREMENT FOR SHORT SALE APPROVALS Recently enacted Senate Bill 306 does not require lenders to review short sale requests from sellers and their agents within 21 days . The new California law, which addresses certain escrow procedures, has been mischaracterized by some practitioners as landmark legislation calling for a 21-day turnaround for short sale approvals. The new law inserts a short payoff amount request into the existing payoff demand law which generally requires a lender to respond to a request for a payoff demand statement within 21 days from when it is requested,...

CAR just released the names of 16 attorneys who were collecting fees for loan mods and doing nothing in return. If you know of any attorney's who are splitting fees with real estate agents on loan modifications, realize they are committing a crime. Attornies are not allowed to split their fees with non-attornies. Hopefully you are not working with any unscrupulous lawyers or agents. As I’ve been saying, you don’t need to hire anyone to help you complete a loan mod. Send the bank the required info. I've confirmed this with SVP's at banks and they say the same thing. Right now loan mods are based on a business decision. Does the Net Present Value on the new modified loan exceed what the bank would get in a foreclosure. You don't have to calculate the NPV (net present value), the bank does this, however if you are financially savvy, ask me for my free loan mod spreadsheet. Work the numbers to see if you can make a business case to support your loan modification. good luck....

FDIC just launched a resource page to prevent foreclosure. I’d like to see stats on how many home owners have been helped so far, and maybe break that down by categories like (reduced interest rate, reduced principle, extended amortization). Total written off today. Also which banks have been doing this. We can applaud the banks that are working to prevent foreclosure. Press Release FDIC Launches Foreclosure Prevention Initiative FOR IMMEDIATE RELEASE September 16, 2009 Media Contact: David Barr (202) 898-6992 The Federal Deposit Insurance Corporation (FDIC) today announced that it is releasing a free tool kit of information that will help borrowers, community stakeholders and the banking industry avoid unnecessary foreclosures and stop foreclosure "rescue" scams that promise false hope to consumers at risk of losing their homes. The tool kit includes critical information to help borrowers know who to contact and what documents they need to have available to apply for a lo...

President Obama Outlined there would be opportunities to refinance homes held by Fannie & Freddie as well as, encouraging lenders to modify terms of loans to bring the debt to income (DTI) ratio to 38% by lowering the interest rate and/or reducing the outstanding principle balance. If the they do, the government will participate with them to further reduce the payment to 31% DTI and a 50/50 cost share basis. To learn if you are eligible for refinancing look here . To learn if you are eligible for modifaction look here . Requirements of Home Affordable Modification program: Primary residence? Is the amount you owe on your first mortgage equal to or less than $729,750? Are you having trouble paying your mortgage? For example, have you had a significant increase in your mortgage payment OR reduction in your income since you got your current loan OR have you suffered a hardship that has increased your expenses (like medical bills)? Did you get your current mortgage before January 1, 2...

The White House Blog does a great job going over the basics of the plan. http://www.whitehouse.gov/blog/09/02/18/Help-for-homeowners/ Key take aways March 4 – further details will be provided Lenders will be self evaluating their portfolios to see who’s eligible, if you don’t hear from them, than contact them. The program is focused on lowering the interest rates, not writing off loans The loans need to be owned by Freddie or Fannie (you can find out by contacting your lender after March 4) (max loan would be $729,750 than??) Even if your loans exceeds 80% of the value, Fannie and Freddie will refinance (I assume what they mean is that there won’t be an MI fee, or other risk based fee for going beyond 80% in LTV) Maximum Loan-To-Value (LTV) is 105% 2 nd mortgagee lenders have to agree to subordinate (i.e. no consolidation, terms of 2 nd don’t change unless they you negotiate separately with them) Primary residences only (1-4 units okay) Interest rate you get is a 30 yr fixed at ...

I received this information from a lender regarding the HOPE Mortgage Program. It doesn't look that promising but I would definitely investigate it. If you are interested in finding out more you have to contact your lender’s customer service department. Please share your experiences here. -sunil Housing Finance Reform Title IV HOPE FOR HOMEOWNERS Creation of a new FHA Loan Program “HOPE FOR HOMEOWNERS PROGRAM” (aka FHA Rescue): (Page 394) · The purpose of the Program it so insure refinanced loans for distressed Borrowers; allowing owner occupant homeowners to avoid foreclosure by reducing their principal outstanding balance and their current interest rate; ( think of a short sell refinance ) . I am not aware of any Lenders that will pay an origination fee, when they are taking a significant loss of the loan to start. Lost principal that will be absorbed by the bank, possibly the Federal government if that comes out of our latest housing Bill on the floor. Not likely. · The Bill a...