Home Buying and Selling Tips for Fall
Here are some of their tips for fall buyers and sellers:
Fall Sellers:
Replace faded summer plants with fall-blooming flowers and add autumn decorations to the home.
Expect low-ball offers and be prepared with higher counter offers.
Freshen up listing photos by shooting pictures that make it less obvious that the seasons have changed.
Price the home to sell. A price that is a little lower than the competition may be a winning move.
Be willing to show the property and hold open houses whenever potential buyers are ready
Fall Buyers:
Look for motivated sellers who have a reason to move on by the end of the year.
Explore new constructions. Builders are often interested in selling before the new tax year.
Beware of fall maintenance issues. Consider overflowing gutters and leaf-covered lawns.
Shape offers carefully. Even in this market it is possible to turn sellers off with a too-low bid.
Fall Maintenance
1. Check your heating system including filters, pilot lights and burners. Have the system serviced by a qualified professional. Cleaning and servicing now can save you money later. Learn steps to boost your furnace's efficiency and how to replace your furnace filter.
Tuesday, October 26, 2010
Wednesday, October 20, 2010
Bank of America Foreclosures to Resume in 23 States (CA not included yet)
Here’s a list of the 23 states in which Bank of America will begin reissuing foreclosures:
Connecticut, Florida, Hawaii, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Nebraska, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Vermont, Wisconsin
Bank of America will resume mortgage foreclosures in 23 states.
The bank, which earlier this month stopped foreclosures across the nation, announced its plans to restart foreclosure sales in nearly half of those states by October 25, which is next Monday. Chase Bank, PNC Bank and Ally GMAC have all stopped foreclosures in those 23 states.
The bank reported that it had not found any improper paperwork so far. It will resume 102,000 foreclosures next week as a result of the decision.
“Our initial assessment findings show the basis for our foreclosure decisions is accurate,” Bank of America said in a statement. “Our decision to review our process and later, to extend our review to all 50 states, has been an important step to give customers confidence they are being treated fairly.”
Here’s a list of the 23 states in which Bank of America will begin reissuing foreclosures:
Connecticut, Florida, Hawaii, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Nebraska, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Vermont, Wisconsin
Bank of America will resume mortgage foreclosures in 23 states.
The bank, which earlier this month stopped foreclosures across the nation, announced its plans to restart foreclosure sales in nearly half of those states by October 25, which is next Monday. Chase Bank, PNC Bank and Ally GMAC have all stopped foreclosures in those 23 states.
The bank reported that it had not found any improper paperwork so far. It will resume 102,000 foreclosures next week as a result of the decision.
“Our initial assessment findings show the basis for our foreclosure decisions is accurate,” Bank of America said in a statement. “Our decision to review our process and later, to extend our review to all 50 states, has been an important step to give customers confidence they are being treated fairly.”
Monday, October 18, 2010
California Latinos: Paying the High Price of Foreclosure
Latinos and African Americans in California have experienced significantly higher foreclosure rates than non-Hispanic borrowers in the state, according to the Center of Responsible Lending. These communities represent more than half of all foreclosures, with 48% of foreclosures on Latinos and 8% on African Americans. The study analyzed more than 600,000 foreclosures.
Latinos and African Americans in California have experienced significantly higher foreclosure rates than non-Hispanic borrowers in the state, according to the Center of Responsible Lending. These communities represent more than half of all foreclosures, with 48% of foreclosures on Latinos and 8% on African Americans. The study analyzed more than 600,000 foreclosures.
Wednesday, October 13, 2010
A DAY OF JOY FOR HUMAN KIND!!
What a glorious day!, they have rescued the 33 miners in Chile!
For the last two months we have grown used to listening about the terrible ordeal that these poor men and their families were enduring, imagine being trapped a mile under the surface, with slight to none chances of surviving. It went from a headline news to a second rated notice, except for these poor people.
Today billions of people around the world watched, with tears in our eyes, the exhiliarating moments of a great triumph of man kind, of our technology, or persistence, and more than anything, the miracle of life.
It made me think. How lucky we are, no matter how trapped we feel by our economy, our joblessness, our family problems, when we compare our ordeal to what these men went through, all our problems sudenly seem so, so small, so pale.
This day, today, is without a doubt, the happiest day of all of these guy's lives, and why are they so happy?, because they now are aware that no matter how poor they are, how bad their situation was, it can always be much worse and how ever their life was before being trapped, it was a life worth living, they could look at the sunset, admire the beauty of nature, they were loved by their families, they could enjoy the wonders of God's creation for free, and they had taken all of this for granted, as we all do.
We are so immersed in our little world, that we forget to enjoy the truly amazing things that God placed are around us every day.
That is why we all cried, that is why, this is a great day for all of us, humans, because this fantastic event in that tiny town in Chile, has given us all, a chance to reflect, to rethink our priorities, to appreciate what we have, and to praise our God and thank him for making this life so amazingly wonderful!
What a glorious day!, they have rescued the 33 miners in Chile!
For the last two months we have grown used to listening about the terrible ordeal that these poor men and their families were enduring, imagine being trapped a mile under the surface, with slight to none chances of surviving. It went from a headline news to a second rated notice, except for these poor people.
Today billions of people around the world watched, with tears in our eyes, the exhiliarating moments of a great triumph of man kind, of our technology, or persistence, and more than anything, the miracle of life.
It made me think. How lucky we are, no matter how trapped we feel by our economy, our joblessness, our family problems, when we compare our ordeal to what these men went through, all our problems sudenly seem so, so small, so pale.
This day, today, is without a doubt, the happiest day of all of these guy's lives, and why are they so happy?, because they now are aware that no matter how poor they are, how bad their situation was, it can always be much worse and how ever their life was before being trapped, it was a life worth living, they could look at the sunset, admire the beauty of nature, they were loved by their families, they could enjoy the wonders of God's creation for free, and they had taken all of this for granted, as we all do.
We are so immersed in our little world, that we forget to enjoy the truly amazing things that God placed are around us every day.
That is why we all cried, that is why, this is a great day for all of us, humans, because this fantastic event in that tiny town in Chile, has given us all, a chance to reflect, to rethink our priorities, to appreciate what we have, and to praise our God and thank him for making this life so amazingly wonderful!
Tuesday, October 12, 2010
Foreclosure Moratorium, Robo-Signer Fiasco Should Be Resolved Soon.
The White House, yielding to common sense, opposes a national moratorium on foreclosure sales on the grounds that it would harm the housing market. (Finally something good from the Obamas)
David Axelroid, a White House senior adviser, said on CBS’s “Face the Nation” on Suday: “I’m not sure about a national moratorium because there are, in fact, valid foreclosures that probably should go forward.”
That brings up the question of what a valid foreclosure is. My definition: When a homeowner hasn’t made mortgage payments in at least three months, and the servicer has notified all necessary parties that it intends to take back the property, and the borrower doesn’t reach some sort of accommodation with the servicer, then a foreclosure is valid.
Some readers commented last week that mortgage servicers forged documents. The robo-signing issue has nothing to do with forgery. The robo-signers aren’t accused of faking documents. They’re accused of not closely reading the documents, which mostly are legal boilerplate.
Other readers say the foreclosing servicer should be required to prove ownership of the loan. I’m not sure what the argument is here. The borrower doesn’t send checks to the servicer. After a few months, that same servicer starts the foreclosure process. Obviously, the servicer works on behalf of the owner (or owners) of the loan.
When two servicers foreclose, I can see where ownership of the loan becomes a valid question. But I don’t think there are a lot of cases of multiple servicers foreclosing on the same loan.
Hot off the press from Bloomberg.
It appears that the robo-signer…foreclosure moratorium will be resolved this week.
Title insurers are in talks with banks and regulators to obtain warranties from lenders assuring they followed proper procedures before selling foreclosed homes, said Kurt Pitohouse, head of the insurers’ trade group.
“Everyone sort of sees the same risks, and that’s the good part,” Pitohouse, chief executive officer of the American Land Title Association, said today in a telephone interview. “You just have to craft a solution that’s acceptable to all the parties, and we’re making progress.”
Bank of America Corp., the biggest U.S. lender, on Oct. 8 extended a freeze on foreclosures to all 50 states amid concern by federal and state officials that homes are being seized based on faulty information. The Charlotte, North Carolina-based bank agreed that day to issue warranties for Fidelity National Financial Inc., the largest title insurer, said Peter Sidransky executive vice president and chief legal officer for Fidelity.
“It’s a representation that there are no issues going forward and an indemnity if someone makes a mistake,” he said.
JPMorgan Chase & Co. and Ally Financial Inc.’s GMAC Mortgage unit have also stopped repossession cases in 23 states where courts supervise home seizures, amid allegations that employees submitted documents with unverified or false data to speed the process.
End of Week
A decision on the warranties may be reached by the end of the week, Pitohouse said. The assurances would help lenders resume foreclosures of homes with mortgage defaults and continue selling off their backlog of repossessed properties, he said. Pitohouse wouldn’t name the companies or regulators involved in the talks.
Fidelity National shares have dropped 10 percent this month. The company had about 38 percent of the market in the second quarter, according to the title insurance association. Shares of Santa Ana, California-based First American Financial Co., the No. 2 insurer, have fallen 5 percent.
Costs for title insurers to defend customers and reimburse for lost properties rose to $480.5 million in the first half of 2010, an increase of 14 percent from a year earlier, according to the American Land Title Association.
Among the tasks performed by title insurers is reviewing the public record for a court order that confirms a bank owns a particular property before it’s foreclosed on, Pitohouse said.
“Court rulings on valid foreclosures are going to be challenged,” he said. “That means we may get pulled into litigation.”
Preventing Risks
The warranties in the works are intended to protect title insurers from similar risks in the future, Pitohouse said.
Bank of America’s agreement with Jacksonville, Florida- based Fidelity National calls for the lender to cover the title insurer’s costs in the event of an error in the company’s processing of foreclosure documents, Sidranski or (Charransky, as his friends call him) said. The bank will notify the insurer in each case that the foreclosure complies with state laws and regulations.
Bank of America is in talks with other title insurers for similar agreements, said Richard Bramhall, the bank’s chief title officer. He declined to name the other companies.
“Our goal is to restore order to the chaos,” he said. “We’re optimistic that this will help calm the waters in regard to all the anxiety you see all over the country.”
The White House, yielding to common sense, opposes a national moratorium on foreclosure sales on the grounds that it would harm the housing market. (Finally something good from the Obamas)
David Axelroid, a White House senior adviser, said on CBS’s “Face the Nation” on Suday: “I’m not sure about a national moratorium because there are, in fact, valid foreclosures that probably should go forward.”
That brings up the question of what a valid foreclosure is. My definition: When a homeowner hasn’t made mortgage payments in at least three months, and the servicer has notified all necessary parties that it intends to take back the property, and the borrower doesn’t reach some sort of accommodation with the servicer, then a foreclosure is valid.
Some readers commented last week that mortgage servicers forged documents. The robo-signing issue has nothing to do with forgery. The robo-signers aren’t accused of faking documents. They’re accused of not closely reading the documents, which mostly are legal boilerplate.
Other readers say the foreclosing servicer should be required to prove ownership of the loan. I’m not sure what the argument is here. The borrower doesn’t send checks to the servicer. After a few months, that same servicer starts the foreclosure process. Obviously, the servicer works on behalf of the owner (or owners) of the loan.
When two servicers foreclose, I can see where ownership of the loan becomes a valid question. But I don’t think there are a lot of cases of multiple servicers foreclosing on the same loan.
Hot off the press from Bloomberg.
It appears that the robo-signer…foreclosure moratorium will be resolved this week.
Title insurers are in talks with banks and regulators to obtain warranties from lenders assuring they followed proper procedures before selling foreclosed homes, said Kurt Pitohouse, head of the insurers’ trade group.
“Everyone sort of sees the same risks, and that’s the good part,” Pitohouse, chief executive officer of the American Land Title Association, said today in a telephone interview. “You just have to craft a solution that’s acceptable to all the parties, and we’re making progress.”
Bank of America Corp., the biggest U.S. lender, on Oct. 8 extended a freeze on foreclosures to all 50 states amid concern by federal and state officials that homes are being seized based on faulty information. The Charlotte, North Carolina-based bank agreed that day to issue warranties for Fidelity National Financial Inc., the largest title insurer, said Peter Sidransky executive vice president and chief legal officer for Fidelity.
“It’s a representation that there are no issues going forward and an indemnity if someone makes a mistake,” he said.
JPMorgan Chase & Co. and Ally Financial Inc.’s GMAC Mortgage unit have also stopped repossession cases in 23 states where courts supervise home seizures, amid allegations that employees submitted documents with unverified or false data to speed the process.
End of Week
A decision on the warranties may be reached by the end of the week, Pitohouse said. The assurances would help lenders resume foreclosures of homes with mortgage defaults and continue selling off their backlog of repossessed properties, he said. Pitohouse wouldn’t name the companies or regulators involved in the talks.
Fidelity National shares have dropped 10 percent this month. The company had about 38 percent of the market in the second quarter, according to the title insurance association. Shares of Santa Ana, California-based First American Financial Co., the No. 2 insurer, have fallen 5 percent.
Costs for title insurers to defend customers and reimburse for lost properties rose to $480.5 million in the first half of 2010, an increase of 14 percent from a year earlier, according to the American Land Title Association.
Among the tasks performed by title insurers is reviewing the public record for a court order that confirms a bank owns a particular property before it’s foreclosed on, Pitohouse said.
“Court rulings on valid foreclosures are going to be challenged,” he said. “That means we may get pulled into litigation.”
Preventing Risks
The warranties in the works are intended to protect title insurers from similar risks in the future, Pitohouse said.
Bank of America’s agreement with Jacksonville, Florida- based Fidelity National calls for the lender to cover the title insurer’s costs in the event of an error in the company’s processing of foreclosure documents, Sidranski or (Charransky, as his friends call him) said. The bank will notify the insurer in each case that the foreclosure complies with state laws and regulations.
Bank of America is in talks with other title insurers for similar agreements, said Richard Bramhall, the bank’s chief title officer. He declined to name the other companies.
“Our goal is to restore order to the chaos,” he said. “We’re optimistic that this will help calm the waters in regard to all the anxiety you see all over the country.”
Wednesday, October 6, 2010
The Eco boomers to the rescue!!!
There are many names for the Echo Boom generation: Gen Y, Generation Next, Net Generation, Millennials, Boomerang Generation and Trophy Generation, to name a few (OK, several).
Regardless of what you call them, the members of this generation are quickly coming of age; some are even starting to enter the housing market and there are many, many more to follow.
Echo boomers were born roughly between 1982-95 -- they are largely the offspring of baby boomers.
Fast forward to 2010. There are approximately 76 million echo boomers between 15 and 28 years old, making them second in size only to the baby boomers (age and population figures cited here represent an approximation based upon information found in studies done by the National Association of Realtors, current U.S. Census data, Wikipedia, and various media sources).
According to current U.S. Census figures, 67.2 percent of this generation can be expected to become homeowners by their mid 30s, which equates to just over 35.5 million households (U.S. Census homeownership rates are calculated based on households, not people).
The National Association of Realtors' 2009 Profile of Home Buyers and Sellers predicts that of this 35.5 million, 21 percent will be single female buyers, 12 percent will be single males, and 61 percent will be married couples or partners (couples/partners are counted as a single household).
It's worth pointing out here that the aforementioned U.S. Census figures also state that since 1982, homeownership rates have fluctuated very little; anywhere between 64 percent and 69 percent during this 28-year span.
As you wrap your head around those figures, think about the impact that this generation is going to have on housing in the coming years. According to a recent economic report by Moody's, builders are currently developing about 500,000 housing units a year.
Add into this equation that the echo boomers will be buying homes alongside repeat purchasers from other generations and you can quickly surmise that in the foreseeable future we are going to have a shortage of housing in the "more affordable" markets (where homes are priced at or below the area's median price).
The onset of the echo boomers in the housing market is a stark reminder of how important our community's growth-management plans are. The sheer size of the Echo Boom generation will have a powerful effect on housing demand over the next decade, but will there be enough homes to meet that demand?
Current studies say no, reinforcing the importance of implementing smart growth management NOW. The first wave of change will likely occur in the more affordable price ranges -- especially in those areas that are close to job centers. Over time, the effect will fan out and be felt by the outer suburbs, causing a chain reaction of sales up the price points.
The Echo Boom generation has been defined as high-tech, high-touch, social-networking, iPod-listening natives of the digital realm who trust their peers' advice over most forms of advertising. This is the generation that will likely find the home of their dreams on a 4G wi-max third-generation iPad and will contact their real estate agent via Twitter or text message.
But as foreign as some of this may sound to some of you, they are (and will be) homebuyers nonetheless, and real estate professionals and companies need to continue to adapt to this generation's expectations and habits.
So, the moral of this story is that I believe that the echo boomers represent the silver lining for the real estate market and U.S. economy. That might be a lot of responsibility for a single generation, but they're unarguably emerging as the next heavyweights in housing, and I might add: not a moment too soon.
There are many names for the Echo Boom generation: Gen Y, Generation Next, Net Generation, Millennials, Boomerang Generation and Trophy Generation, to name a few (OK, several).
Regardless of what you call them, the members of this generation are quickly coming of age; some are even starting to enter the housing market and there are many, many more to follow.
Echo boomers were born roughly between 1982-95 -- they are largely the offspring of baby boomers.
Fast forward to 2010. There are approximately 76 million echo boomers between 15 and 28 years old, making them second in size only to the baby boomers (age and population figures cited here represent an approximation based upon information found in studies done by the National Association of Realtors, current U.S. Census data, Wikipedia, and various media sources).
According to current U.S. Census figures, 67.2 percent of this generation can be expected to become homeowners by their mid 30s, which equates to just over 35.5 million households (U.S. Census homeownership rates are calculated based on households, not people).
The National Association of Realtors' 2009 Profile of Home Buyers and Sellers predicts that of this 35.5 million, 21 percent will be single female buyers, 12 percent will be single males, and 61 percent will be married couples or partners (couples/partners are counted as a single household).
It's worth pointing out here that the aforementioned U.S. Census figures also state that since 1982, homeownership rates have fluctuated very little; anywhere between 64 percent and 69 percent during this 28-year span.
As you wrap your head around those figures, think about the impact that this generation is going to have on housing in the coming years. According to a recent economic report by Moody's, builders are currently developing about 500,000 housing units a year.
Add into this equation that the echo boomers will be buying homes alongside repeat purchasers from other generations and you can quickly surmise that in the foreseeable future we are going to have a shortage of housing in the "more affordable" markets (where homes are priced at or below the area's median price).
The onset of the echo boomers in the housing market is a stark reminder of how important our community's growth-management plans are. The sheer size of the Echo Boom generation will have a powerful effect on housing demand over the next decade, but will there be enough homes to meet that demand?
Current studies say no, reinforcing the importance of implementing smart growth management NOW. The first wave of change will likely occur in the more affordable price ranges -- especially in those areas that are close to job centers. Over time, the effect will fan out and be felt by the outer suburbs, causing a chain reaction of sales up the price points.
The Echo Boom generation has been defined as high-tech, high-touch, social-networking, iPod-listening natives of the digital realm who trust their peers' advice over most forms of advertising. This is the generation that will likely find the home of their dreams on a 4G wi-max third-generation iPad and will contact their real estate agent via Twitter or text message.
But as foreign as some of this may sound to some of you, they are (and will be) homebuyers nonetheless, and real estate professionals and companies need to continue to adapt to this generation's expectations and habits.
So, the moral of this story is that I believe that the echo boomers represent the silver lining for the real estate market and U.S. economy. That might be a lot of responsibility for a single generation, but they're unarguably emerging as the next heavyweights in housing, and I might add: not a moment too soon.
Friday, September 24, 2010
BANK OF AMERICA TAKEN HOSTAGE!!!
A disgruntled Realtor took Bank of America hostage this morning. Apparently frustrated by the endless abuse he had suffered from the Institution during the past 3 years, according to sources.
He demanded the President of that Institution, to acknowledge the horrible way that the bank has been managing the short sale negotiations.
A passer by said he overheard the crazy Realtor shout: "Do you think it is funny? to waste my time for months, pushing paper, gathering information, waiting hours on the phone, being treated like dirt by incompetent personnel, and in the end see the house go to foreclosure?" "Who the f%^&k do you people think you are?"
One of the hostages who was able to escape on time, said he heard the Supervisor plead for his life, crying to the Realtor: "Please, I swear I will approve all your short sales from now on, please", but the Realtor didn't look very impressed by his cowardly conduct.
A group of local Realtors gathered outside the branch, but not simple "looky loos", to the surprise of our correspondent, they were there "To support our hero, it was about time somebody stand up to the Banks and tell the story, we ALL feel the same way"
The masses chanted: "HEY HEY WE WON'T GO, ITS THE BANK THAT HAS TO GO!"
The National Association of Realtors had no comment,
A Washington correspondent asked President Obama in a briefing this morning, what was his opinion about this crisis, and he limited his comments to: "it was bound to happen sooner or later, Banks have to be more proactive and reasonable"
We will keep you informed as this crisis develops.
United Press Corporation
This is just a joke, it is not true, I hope it helps you air some of that frustration you, the Realtor have accumulated. Have a blessed day.
A disgruntled Realtor took Bank of America hostage this morning. Apparently frustrated by the endless abuse he had suffered from the Institution during the past 3 years, according to sources.
He demanded the President of that Institution, to acknowledge the horrible way that the bank has been managing the short sale negotiations.
A passer by said he overheard the crazy Realtor shout: "Do you think it is funny? to waste my time for months, pushing paper, gathering information, waiting hours on the phone, being treated like dirt by incompetent personnel, and in the end see the house go to foreclosure?" "Who the f%^&k do you people think you are?"
One of the hostages who was able to escape on time, said he heard the Supervisor plead for his life, crying to the Realtor: "Please, I swear I will approve all your short sales from now on, please", but the Realtor didn't look very impressed by his cowardly conduct.
A group of local Realtors gathered outside the branch, but not simple "looky loos", to the surprise of our correspondent, they were there "To support our hero, it was about time somebody stand up to the Banks and tell the story, we ALL feel the same way"
The masses chanted: "HEY HEY WE WON'T GO, ITS THE BANK THAT HAS TO GO!"
The National Association of Realtors had no comment,
A Washington correspondent asked President Obama in a briefing this morning, what was his opinion about this crisis, and he limited his comments to: "it was bound to happen sooner or later, Banks have to be more proactive and reasonable"
We will keep you informed as this crisis develops.
United Press Corporation
This is just a joke, it is not true, I hope it helps you air some of that frustration you, the Realtor have accumulated. Have a blessed day.
Monday, September 20, 2010
Are we finally going to get a break from all the nonsense that we have been put through?
This is breaking news from REO Insider...and great news at that...It appears that we will see some greater support in the form of actual Short Sale Laws from our government...Limiting the time a bank can respond to a short sale request from it's borrowers...
Rep. Robert Andrews (D-NJ) and Rep. Tom Rooney (R-FL) have introduced a bill in the house H.R. 6133 - Prompt Decision for Qualification of Short Sale Act of 2010; that would force lenders to make a yes or no decision on a short sale within 45 days of the short sale request. This could be huge in facilitating short sales.
There appears to be widespread support for the bipartisan proposal. The National Association of Realtors supports the effort, and NAR President Vicki Cox Golder said:
"As the leading advocate for homeownership issues, NAR believes that quicker attention to the short sales process is vital to help homeowners who are underwater and their communities, as well as the nation's
Credit for this goes to: Harris Real Estate University....Great news!
This is breaking news from REO Insider...and great news at that...It appears that we will see some greater support in the form of actual Short Sale Laws from our government...Limiting the time a bank can respond to a short sale request from it's borrowers...
Rep. Robert Andrews (D-NJ) and Rep. Tom Rooney (R-FL) have introduced a bill in the house H.R. 6133 - Prompt Decision for Qualification of Short Sale Act of 2010; that would force lenders to make a yes or no decision on a short sale within 45 days of the short sale request. This could be huge in facilitating short sales.
There appears to be widespread support for the bipartisan proposal. The National Association of Realtors supports the effort, and NAR President Vicki Cox Golder said:
"As the leading advocate for homeownership issues, NAR believes that quicker attention to the short sales process is vital to help homeowners who are underwater and their communities, as well as the nation's
Credit for this goes to: Harris Real Estate University....Great news!
Tuesday, September 7, 2010
FORECLOSURE ROULETTE, IS IT THE NEW GAME IN OUR NATION?
I read this article, posted by Sean O'Toole, founder of Foreclosure Radar, I found it incredibly interesting, and the more I think about it, the more I think it is right on the money.
The reality is that through financial engineering (interest only, subprime, swaps, option ARMs, negative equity, stated income, etc.,) we created trillions in excess mortgage debt that has left millions of homeowners underwater, financial institutions on the brink of collapse, and the FDIC nearly insolvent. Back in September 2008 it became clear that financial collapse was imminent, and the federal government did what it does best – bailed out those who caused the crisis while leaving taxpayers holding the bag for the losses. Pulling this hat trick off required one simple ruse – getting everyone to believe that those losses ultimately wouldn’t be very big.
To do this the government changed the rules. The FDIC who previously forced banks to get bad assets off their books became a leading proponent of saving homeowners with loan modifications that likely just delay the inevitable. With a little government pressure, the supposedly independent Federal Accounting Standards Board was pressured into letting banks account for loans at theoretical values based on computer models rather than current market value.
Next they began rolling out an acronym soup of programs, which they promoted as being help for America’s homeowners – HAMP, HAFA, HARP, 2MP and more. But the reality is that to date these programs have resulted in little more than delays. The government and lenders say that these failures are due to complexities of implementation, difficulty reaching homeowners and a sundry other things. But what if these programs were never intended to succeed? What if they were simply intended to create delays, provide false hope, and maybe get the banks a bit more cash out of homeowners in the form of trial loan modification payments?
Sounds like a crazy conspiracy theory, I know, but hear me out.
The problem faced by both lenders and the government is that they can neither afford to kick homeowners out, or bail them out. For lenders, either scenario forces losses to be recognized, while thanks to mark-to-model accounting rules, and little or no pressure to foreclose from the FDIC, they can instead leave non-paying homeowner in place and push those losses into the future. Many believe that most major corporations manage earnings, what could be more perfect than getting to choose when, and if, they recognize mortgage related losses. For the U.S. government either scenario is political death. Politicians have no appetite for allowing banks to put families on the street en masse through foreclosure, nor forcing banks to deal with the problem through bankruptcy cram-downs or other means. At the same time they realize their constituents who do pay their mortgage (or rent) simply won’t stand for a taxpayer funded bailout of their upside down neighbor. Instead, it seems they believe bailouts should be saved for the truly deserving like the executives and corporate shareholders of banks, AIG, GM, etc.
If we aren’t willing to either kick non-paying homeowners out of their homes, or bail them out, what other option is there? The answer is clear. It’s the same thing we’ve done with national deficits for years. Trade tomorrow for today, with a policy of extend and pretend. I have no doubt this is the present policy, and that this will be the policy for years to come as we work through wiping out the trillions in excess negative equity that was created during the bubble.
A member of the audience during my talk asked if this policy was really possible, after all we can’t just let non-paying homeowners stay in their homes forever. If paying homeowners figured that out, everyone would stop paying, and then our financial system would crumble. I agree, and it’s clear the banks realize this too. But it is a problem that is easily solved by the diabolical game of Russian roulette. So long as lenders continue to foreclose on at least a handful of homeowners each month, in what from all appearances is a completely random game of chance, they’ll keep those willing and able to pay their mortgage doing so. Those who decide not to pay their mortgage will find themselves playing today’s update on the Russian game, Foreclosure Roulette, wondering each month whether they’ll get another free month in their prison of debt, or finally be shot and forced to move.
Sean O'Toulle /houseINsandiego
I read this article, posted by Sean O'Toole, founder of Foreclosure Radar, I found it incredibly interesting, and the more I think about it, the more I think it is right on the money.
The reality is that through financial engineering (interest only, subprime, swaps, option ARMs, negative equity, stated income, etc.,) we created trillions in excess mortgage debt that has left millions of homeowners underwater, financial institutions on the brink of collapse, and the FDIC nearly insolvent. Back in September 2008 it became clear that financial collapse was imminent, and the federal government did what it does best – bailed out those who caused the crisis while leaving taxpayers holding the bag for the losses. Pulling this hat trick off required one simple ruse – getting everyone to believe that those losses ultimately wouldn’t be very big.
To do this the government changed the rules. The FDIC who previously forced banks to get bad assets off their books became a leading proponent of saving homeowners with loan modifications that likely just delay the inevitable. With a little government pressure, the supposedly independent Federal Accounting Standards Board was pressured into letting banks account for loans at theoretical values based on computer models rather than current market value.
Next they began rolling out an acronym soup of programs, which they promoted as being help for America’s homeowners – HAMP, HAFA, HARP, 2MP and more. But the reality is that to date these programs have resulted in little more than delays. The government and lenders say that these failures are due to complexities of implementation, difficulty reaching homeowners and a sundry other things. But what if these programs were never intended to succeed? What if they were simply intended to create delays, provide false hope, and maybe get the banks a bit more cash out of homeowners in the form of trial loan modification payments?
Sounds like a crazy conspiracy theory, I know, but hear me out.
The problem faced by both lenders and the government is that they can neither afford to kick homeowners out, or bail them out. For lenders, either scenario forces losses to be recognized, while thanks to mark-to-model accounting rules, and little or no pressure to foreclose from the FDIC, they can instead leave non-paying homeowner in place and push those losses into the future. Many believe that most major corporations manage earnings, what could be more perfect than getting to choose when, and if, they recognize mortgage related losses. For the U.S. government either scenario is political death. Politicians have no appetite for allowing banks to put families on the street en masse through foreclosure, nor forcing banks to deal with the problem through bankruptcy cram-downs or other means. At the same time they realize their constituents who do pay their mortgage (or rent) simply won’t stand for a taxpayer funded bailout of their upside down neighbor. Instead, it seems they believe bailouts should be saved for the truly deserving like the executives and corporate shareholders of banks, AIG, GM, etc.
If we aren’t willing to either kick non-paying homeowners out of their homes, or bail them out, what other option is there? The answer is clear. It’s the same thing we’ve done with national deficits for years. Trade tomorrow for today, with a policy of extend and pretend. I have no doubt this is the present policy, and that this will be the policy for years to come as we work through wiping out the trillions in excess negative equity that was created during the bubble.
A member of the audience during my talk asked if this policy was really possible, after all we can’t just let non-paying homeowners stay in their homes forever. If paying homeowners figured that out, everyone would stop paying, and then our financial system would crumble. I agree, and it’s clear the banks realize this too. But it is a problem that is easily solved by the diabolical game of Russian roulette. So long as lenders continue to foreclose on at least a handful of homeowners each month, in what from all appearances is a completely random game of chance, they’ll keep those willing and able to pay their mortgage doing so. Those who decide not to pay their mortgage will find themselves playing today’s update on the Russian game, Foreclosure Roulette, wondering each month whether they’ll get another free month in their prison of debt, or finally be shot and forced to move.
Sean O'Toulle /houseINsandiego
Wednesday, September 1, 2010
How to payoff your mortgage in half the time
Save Thousands of dollars...payoff your mortgage early
I will give you step by step instructions on how to payoff your 30 year home loan in 15 years or even less and save thousands!!
Difficulty level: Easy
Instructions:
Things You'll Need: An amortization schedule
1. 1 It's easy to save tons of money when you payoff your house early
If you have a fixed interest rate mortgage on your home with no prepayment penalty, you can pay off your 30 year mortgage debt in 15 years and save lots of money on interest.
This strategy applies to any fixed rate mortgage whether it be 40 years or 10 years.
2. 2 Here's how....
1. Ask your mortgage company for an amortization schedule. An amortization schedule, it is a table detailing each chronological payment on an amortized loan, they are generated by an amortization calculator. They should be able to email it, or maybe you can create it from your bank's website, worst case scenario it will cost you about 20 dollars. (Think of a changing banks)
2. When you receive it, look at your current payment. It will have a breakdown of your payment showing amount of principal, interest, taxes, insurance and your principal balance after that payment.
You will be amazed at how small the amount is of principal. There is a reason for this...most of the interest you pay is in the first years of your mortgage.
3. On the amortization schedule, look at your current payment due.
4. Pay your total monthly payment plus next months principal payment. If you wish, you can pay more than 1 extra principal payment.
5. Write out 2 checks...1 for your current payment and the other for additional principal.
6. On your check where it is labeled memo, write additional principal.
7. There will also be a place on your payment coupon to write in additional principal and your total payment.
8. After you write the amount, check it off your amortization schedule so you can keep up with your payments.
When you do this, you eliminate that months interest, thereby decreasing your mortgage debt. You can now pay off your mortgage debt in half of the time or less e. g. 360 payments into 180 saving boatloads of interest money.
You will be amazed at how small the extra principal amount is and how much interest you save!!
Save Thousands of dollars...payoff your mortgage early
I will give you step by step instructions on how to payoff your 30 year home loan in 15 years or even less and save thousands!!
Difficulty level: Easy
Instructions:
Things You'll Need: An amortization schedule
1. 1 It's easy to save tons of money when you payoff your house early
If you have a fixed interest rate mortgage on your home with no prepayment penalty, you can pay off your 30 year mortgage debt in 15 years and save lots of money on interest.
This strategy applies to any fixed rate mortgage whether it be 40 years or 10 years.
2. 2 Here's how....
1. Ask your mortgage company for an amortization schedule. An amortization schedule, it is a table detailing each chronological payment on an amortized loan, they are generated by an amortization calculator. They should be able to email it, or maybe you can create it from your bank's website, worst case scenario it will cost you about 20 dollars. (Think of a changing banks)
2. When you receive it, look at your current payment. It will have a breakdown of your payment showing amount of principal, interest, taxes, insurance and your principal balance after that payment.
You will be amazed at how small the amount is of principal. There is a reason for this...most of the interest you pay is in the first years of your mortgage.
3. On the amortization schedule, look at your current payment due.
4. Pay your total monthly payment plus next months principal payment. If you wish, you can pay more than 1 extra principal payment.
5. Write out 2 checks...1 for your current payment and the other for additional principal.
6. On your check where it is labeled memo, write additional principal.
7. There will also be a place on your payment coupon to write in additional principal and your total payment.
8. After you write the amount, check it off your amortization schedule so you can keep up with your payments.
When you do this, you eliminate that months interest, thereby decreasing your mortgage debt. You can now pay off your mortgage debt in half of the time or less e. g. 360 payments into 180 saving boatloads of interest money.
You will be amazed at how small the extra principal amount is and how much interest you save!!
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