The federal government is offering incentives to encourage mortgage lenders to reduce the amount of mortgage principle owed by troubled homeowners. Additionally, those incentives, which previously were limited to private mortgage lenders, will now, for the first time, also apply to government-backed home loans issued by Freddie Mac and Fannie Mae.
]]> The mortgage modification program has been in place for approximately three years and has cost $29 billion. But according to reports, over half of those applying for mortgage principal reductions have not been able to lower their monthly mortgage payments, with several blaming various bureaucratic snafus and red tape for the problem. A number of banks were reportedly unresponsive to applications or even to inquiries for information and application forms.Those homeowners whose applications are processed and accepted can sometimes obtain interest rates as low as two percent for a period of time lasting as long as five years. They are also able to extend the time period over which their mortgage is paid off, further reducing monthly payments. An analysis of statistical information from the program indicates that the average homeowner saves about $500 a month through participation.
President Obama, in his State of the Union address, admitted that the federal government could, and should, do a better job of aiding debt-beleaguered homeowners. Officials in his administration have promised that they will shortly release new additional legislative proposals designed to alleviate the mortgage foreclosure crisis.
This is excellent news for homeowners in Florida and elsewhere who are facing foreclosure. For additional information, contact an experienced foreclosure defense attorney in your area.
Source: Fox News, "Obama administration to extend and expand foreclosure relief program," Jan. 27, 2012
]]>This week, Standard & Poor's/Case-Shiller home-price index revealed that home prices dropped in November 2011 from October 2011 in almost 19 of the 20 cities tracked. Analysts said that prices also went down in 18 of 20 cities compared to November 2010.
]]> "The trend is down and there are few, if any, signs in the numbers that a turning point is close at hand," said the chairman of the S&P's index committee.The November statistics are the most recent available as the index is based on a three-month moving average.
The committee chairman said that housing process will likely fluctuate up and down slightly in 2012, but overall will "remain broadly stable." The chairman doesn't predict that consistent rises in home values will take place until 2015.
This is much longer than many Americans would expect. However, the chairman said that both lower employment and pay increases are necessary for the housing market to come back. He said clearing more than a million homes from the market that are at risk of foreclosure is also necessary.
Other economists point to the real estate situation in Britain during the 1990s, when housing prices took four years to come back after homeowners lost much of the equity in their homes when housing prices fell.
Source: AJC, "Home prices dropped in November in most US cities," Derek Kravitz, Jan. 31, 2012
]]>The 101-year-old faced foreclosure and was evicted from her home back in September by the U.S. Department of Housing and Urban Development, which threw her and her belongings out on the street. The action came after her son, who is 65-years-old, allegedly defaulted on paying property taxes linked to a reverse mortgage on the property.
]]> Two days after the eviction, HUD promised to allow the elderly woman to return to her longtime home. But now the agency has again barred the woman from her home, asserting that the property is in such bad condition that it cannot allow anyone to reside there.The federal agency conducted an inspection of the property and ruled that it was unsafe and unsanitary, calling it unfit for any human being to live in. HUD explained that it refused to be responsible if anything happened to the elderly woman if she moved back in, based on the fact that it now owns the property.
The woman's son took advantage of a HUD program for the elderly and took out a reverse mortgage for the $32,000 assessed value of the property. The federal agency then acquired the mortgage rights in 2006 after the value of the home went below the loan amount, and foreclosed after property taxes were not paid.
After 60 years of living in her own residence, the elderly woman now confronts the very real possibility of homelessness. For now, the 101-year-old woman has been staying in a room at the residence of a 68-year-old woman who she once had as a student in her Sunday school class.
Source: Boston Globe, "Evicted 101-year-old Detroit woman can't go home," Jan. 22, 2012
]]>Under the agreement, Bank of America, JPMorgan Chase, Wells Fargo, Citibank and Ally Financial would cough up as much as $25 billion and agree to change the ways foreclosures are handled in the future.
]]> According to reports, it is expected that the agreement could be adopted within weeks. Unfortunately, the millions of homeowners who have lost their homes to foreclosure might not have very much to gain from the deal, the Associated Press reported.First, it appears that the settlement agreement would not apply to mortgages that are held by Fannie Mae or Freddie Mac, which includes about half of the county's home loans.
Additionally, many of the 11 million homeowners who are underwater in their mortgages likely won't have their mortgage balances reduced or have the opportunity to refinance under the agreement, the Associated Press reported.
The Associated Press surmised that only about one in 10 struggling homeowners would see a reduction in their principal mortgage balance, which would be reduced by an average of $20,000.
Homeowners who were victims of deceptive practices could also be sent checks for $1,800, but only about half of homeowners who are eligible for the checks may actually receive them, the Associated Press guessed.
On a more positive note, it is believed that the overhaul of the foreclosure industry's guidelines could make things easier for homeowners who are underwater or at-risk.
Source: CBS News, "$25B foreclosure deal: What it could mean for homeowners," Ilyce Glink, Jan. 24, 2012
]]>According to reports, a large wave of foreclosures is expected to hit the country as banks get more aggressive with the 3.5 million mortgages that are currently considered seriously delinquent.
]]> A seriously delinquent mortgage was defined as one that is four months in arrears. This second wave of foreclosures is also expected to lower housing prices, experts say, as more foreclosure properties being to flood the market.RealtyTrac, a real estate tracking firm, said about 1.9 million homeowners had foreclosure complaints, default notices and other actions filed against them in 2011, which was a steep drop from the 2.9 million filed in 2010.
However, a RealtyTrac spokesperson said that lenders showed signs of pushing through delayed foreclosures in some states during the second half of 2011, and that is expected to continue in 2012.
Foreclosure cases were delayed in 2011 as banks tried to address legal problems with their foreclosure filings, including allegations of "robo-signing" and other inaccuracies. Many of the lenders are still in hot water with federal officials for the unlawful practices.
The new year could also bring new opportunities for distressed homeowners. The Federal Reserve has asked Congress to look at additional programs for homeowners in trouble, like reducing the principal on homes that are underwater.
For homeowners who find themselves in trouble with their mortgage payments this year, it is a good idea to contact an experienced foreclosure defense attorney who can go over your options and help you make an informed decision on what to do next.
Source: The LA Times, "Foreclosures expected to rise, pushing home prices lower," E. Scott Reckard, Jan. 12, 2012
]]>The Simpson home facing foreclosure litigation is located in Kendall, Florida. According to court records from the Miami-Dade County Clerk's office, the initial foreclosure complaint against Simpson was filed in September. Simpson's lender is JP Morgan Chase.
]]> Apparently, Simpson's lawyer filed a motion to dismiss the foreclosure against the 4-bedroom, 4,000-sqaure-foot home in November, but a source told CNN that the lender plans to move forward with the lawsuit.CNN reported that Simpson purchased the home in 2000 for $575,000 with a first and second mortgage. In 2003, Simpson reportedly refinanced the home loans with a $592,000 loan through Washington Mutual, which was eventually acquired by Chase.
As a result of the housing market collapse, Simpson's home now has an assessed value of $478,401, and he owes more than $700,000 on the property after penalties and fees accumulated. Simpson did not participate in the state's mortgage mediation program, CNN reported.
Although O.J. Simpson's situation is an extreme case, some Florida homeowners find themselves unable to make payments on their home loans because they are incarcerated or incapacitated for another reason.
In these situations, it's extremely important that homeowners contact a foreclosure defense attorney in their area who can help them deal with their foreclosure case before it is too late.
Source: CNN Money, "O.J. Simpson faces foreclosure on Florida home," Les Christie, Jan. 18, 2012
]]>According to the Tampa Tribune, the Florida man had recently been approved for a loan modification program with his bank, and his payments lowered by $200 per month. However, he was kicked out of the program and threatened with foreclosure when his monthly payment was 80 cents too low.
]]> The man told the Tampa Tribune that he thought it was crazy to lose his home because he had accidentally entered $615.02 rather than $615.82. The man was told by a Bank of America customer service representative to send in a check payment for 80 cents, so he did as instructed.The man reported that after doing exactly what he was told, the mortgage company cashed his 80 cent check. However, the check was returned the following month with a letter from Bank of America stating that his loan was not eligible for the Fannie Mae modification program because the trial period payments were not fully paid on time.
The United Way also sent him a "home transition guide" that is designed to help prepare homeowners for foreclosure. Stunned, the man called Bank of America to protest the 80 cent foreclosure. A bank representative told a reporter from the Tampa Tribune that the error is being fixed and the man's loan modification is being restored.
The foreclosure process can be a real headache, especially when banks make mistakes and threaten to take away peoples' homes without cause. Homeowners who find themselves in this situation should call an experienced foreclosure defense attorney for assistance.
Source: Yahoo News, "80 cent check typo nearly costs man his home," Eric Pfeiffer, Jan. 5, 2012
]]>Recently, Florida Attorney General Pam Bondi announced that her office was suing two West Palm Beach companies that are accused of illegally taking upfront fees for foreclosure rescue services or loan modification assistance.
]]> CRS Marketing and MGD Management are accused of luring in struggling homeowners with promises of staying in their homes for years mortgage free. The homeowners are then allegedly charged upfront fees of between $1,500 and $2,500 as well as $300 per month to put their foreclosures on hold.The lawsuit was filed by the state on Dec. 28, and a temporary injunction and limited asset freeze has since been ordered against the companies. Court documents allege that hundreds of Floridians have been "victimized" by "false representations" made by the companies.
"These companies preyed on Florida's distressed homeowners who were already experiencing financial hardships," Bondi said. "The laws that protect Floridians from deceptive practices and homeowners during the course of a residential foreclosure must be abided by, and I am pleased that the court granted our motion to stop these companies from defrauding Floridians."
The lawsuit also seeks compensation for the homeowners who were allegedly victimized. Court papers ask the companies to pay $10,000 per incident, and $15,000 if the consumer is a senior citizen or handicapped person.
Sadly, there are companies out there that take advantage of homeowners who are in vulnerable financial positions. That is why it's imperative to seek help from only reputable foreclosure defense law firms and other companies offering foreclosure services or loan modification help.
Source: The Palm Beach Post, "Florida AG lawsuit: West Palm Beach firms preyed on distressed homeowners," Kimberly Miller, Jan. 5, 2012
]]>What's worse is that doctors and mortgage counselors believe that many more distressed homeowners could fall victim to these stress-related illnesses as foreclosures are expected to rise again throughout the next year.
]]> Foreclosure counselors reported that they routinely see homeowners experiencing health issues when struggling with foreclosure proceedings, including issues with high blood pressure, asthma symptoms, heart palpitations, insomnia, colds and flu symptoms.In addition to physical illnesses, distressed homeowners are also experiencing issues with psychological disorders, including panic attacks, irritability, hopelessness, depression and temper flairs, researchers found.
The president of Consumer Credit Management Services of Delray Beach noted that homeowners are experiencing anger that brings out the worst in them because, in addition to feeling despair and frustration, they are at their wits end due to the foreclosure proceedings.
The good news is that homeowners can experience relief and improvement of stress-related symptoms and illnesses by receiving help with refinancing loans and keeping their homes, researchers found.
It is also important to point out that many people facing foreclosure have lost their jobs and their health insurance, so they negligent to seek proper medical care. If there is concern about mounting bills and the cost of medicines, credit counselors said to inquire about low-cost or free care.
If you are facing foreclosure, know that you do have options. Contact a foreclosure defense attorney in your area who can help you to devise a plan for the best possible outcome for you and your family.
Source: Sun Sentinel, "Stress of foreclosure can make homeowners ill," Bob LaMendola, Dec. 30, 2011
]]>Up until now, Bondi has been highly criticized for not doing enough to put a stop foreclosure fraud on behalf of some of the state's most notorious foreclosure firms that represent banks and lenders in foreclosure cases against distressed homeowners.
]]> In her request to the Court of Appeal, Bondi said that her office "is investigating a widespread social and economic problem, the creation of invalid assignments of home mortgages that are subsequently used to deprive Florida homeowners of their homes."Assignments of home mortgages have taken center stage in the foreclosure crisis as the ownership of many loans became unclear and diluted as they were securitized, but banks still used the records to take away people's homes.
Ultimately, Bondi is asking the Court of Appeal to have the Supreme Court clarify if the practice of law firms creating and using these invalid assignments of mortgages in court is an unfair or deceptive trade practice subject to state investigation.
"Consumers are unable to defend themselves adequately against these unlawful practices," Bondi wrote in the request, providing reason as to why the state should be able to go after the law firms.
Florida lawmakers and foreclosure defense attorneys interviewed by The Palm Beach Post commended Bondi for taking a stand against the foreclosure mill law firms. They said that the Supreme Court needs to step in to help get the state out of the foreclosure mess that it's in.
This will be a very important issue to follow.
Source: The Palm Beach Post, "Florida's AG files motion requesting Supreme Court decision on foreclosure cases," Kimberly Miller, Dec. 30, 2011
]]>A short sale is when the bank accepts less than what is owed on the property, usually so the bank doesn't have to repossess the property. This can be a good option for homeowners who are in jeopardy of losing their homes to foreclosure. An REO is a home that was already repossessed by the bank and is sold by the bank.
]]> A short sale's average price was about $209,000 in November 2011, while a conventional sale was about $259,000. In the same month, an REO averaged $190,000. If the REO was damaged or distressed, the price lowered even further to $99,000. Therefore, lenders are best off selling a home before it has been repossessed.According to LPS Applied Analytics, there are more than 6 million loans that are delinquent at least 30 days in the United States. Two million of these homes have already entered the foreclosure process. A spokesperson for Inside Mortgage Finance stated that home prices will not see a rebound, possibly well into 2013.
If you are facing home foreclosure, know that you do have options. A loan modification, a short sale and a deed in lieu of foreclosure are three ways in which you can avoid the negative repercussions of foreclosure. Talk to a foreclosure defense attorney in your area to find a resolution that makes the most sense for you.
Source: CNN Money, "Foreclosure sales still pummeling home prices," Les Christie, Dec. 21, 2011
]]>CNN reported that there are certain things homeowners can do to prolong the process as well, like challenging the foreclosure, filing documents close to the deadline and requesting the bank to produce original paperwork.
]]> All of these tactics are perfectly legally and are buying homeowners more time to come up with solutions. However, CNN did report that 40 percent of homeowners in default have not made a mortgage payment in two years or more.Even so, many people don't feel too sorry for the banks, who were accused of "robo-signing" and other questionable tactics that help lead to the foreclosure crisis that has crippled the court systems in many states, including Florida.
Robo-signing meant that bank employees would sign and file erroneous foreclosure documents that they knew little to nothing about. In the wake of this scandal, homeowners have the knowledge to challenge paperwork, especially after consulting a foreclosure defense attorney.
An example discussed by CNN was of a man who owed $300,000 on his mortgage and hadn't made a payment in two years. With the help of his foreclosure defense attorney, the man argued that the bank's paperwork included several non-matching signatures for the same bank employee.
The judge hearing the case dismissed the foreclosure lawsuit because of the non-matching signatures, CNN reported. Although, the bank will have an opportunity to re-file the foreclosure if it can come up with the accurate paperwork.
In order to create more permanent solutions, a spokesperson for the community activist group National Community Reinvestment Coalition said that banks should try harder to reach loan modification agreements that borrowers can actually afford.
Source: CNN, "Foreclosure free ride: 3 years, no payments," Dec. 28, 2011
]]>Foreclosure activity has slowed throughout the nation as lenders have dealt with the repercussions of the "robo-signing" scandal and other process flaws. However, the RealtyTrac report predicts that more than four million new foreclosures will be resubmitted to the courts.
]]> Foreclosure activity is down by 14 percent compared to last year, RealtyTrac pointed out, but this margin is the smallest that it's been over the past 12 months. Also, there are three states reporting increases in foreclosure activity including Arizona, California and Massachusetts.November also saw record highs for foreclosure auctions, during which the court sells the distressed property to an investor or back to the bank. Default notices, which are the first step of the foreclosure process, also saw an increase in August nationally.
The number one state for foreclosures is currently Nevada, even with a new requiring additional documenting and a restructuring of the foreclosure process. Nevada has held steady in this number one ranking for 59 consecutive months.
Home prices will begin feeling a national downward turn as distressed properties increase, RealtyTrac predicted. The hope is investors will see the growth opportunities in the rental market and want to be vigilant when these properties go up for auction. There is also talk of Bank of America selling to investors who would turn around and rent to the original homeowners.
Fannie Mae announced they will not evict anyone over the holidays despite comments from spokespeople stating they will continue in order to prevent backlog. However, the bottom line appears to be that more foreclosures are coming.
If you are in jeopardy of losing your home to foreclosure, know that you do have options. Consult a foreclosure defense attorney in your area who can help you plan out what to do next.
Source: CNBC, "New Foreclosure Wave is Coming," Diana Olick, Dec. 15, 2011
]]>Reports from earlier this year showed that a mere 4 percent of cases that were eligible for foreclosure mediation actually ended in settlement. Reportedly, a task force established by the court recommended in October that the program should end because of its failure.
]]> One of the biggest problems with the program appeared to be getting in contact with the homeowners in the first place. In fact, when homeowners were contacted, the success rate rose to 27 percent, statistics show.Mediation was considered successful if it resulted in a loan modification, short sale or deed-in-lieu of foreclosure. These are all positive alternatives to foreclosure. However, both borrowers and lenders said it was hard to get to this point through the mediation program.
From the homeowner's point of view, the program appeared to be too closely connected to the banking industry. Additionally, sometimes people sent to mediations on behalf of the banks didn't have the authority to make any changes, the Orlando Sentinel reported.
As far as the banks were concerned, they typically had already tried to reach a more manageable arrangement with homeowners and were unsuccessful, a lobbyist for the Florida Bankers Association told the Orlando Sentinel. He pointed out that foreclosures only end up in court if they can't reach a settlement agreement.
The Chief Justice's letter stated that cases already enrolled in the mediation program as of Dec. 19 will continue to participate, but no additional cases will be referred.
Now more than ever distressed Florida homeowners can use the assistance of a foreclosure defense attorney to help weigh options and establish a plan to get out of foreclosure.
Sources: Orlando Sentinel, "Florida justice shuts down foreclosure mediation program," Kathleen Haughney, Dec. 19, 2011; "Miami Herald, Florida's foreclosure mediation program ends," Toluse Olorunnipa, Dec. 19, 2011
]]>Data suggests that the programs introduced by the Obama administration back in early 2009 have helped 2 million people remain in their homes, far less than what was expected. Moreover, some of the program participants are not completely out of woods yet and could still lose their homes to foreclosure.
]]> Other foreclosure prevention programs that followed have failed to live up to their intended purposes, too, USA Today reported.One example is an initiative that planned to levy out $1 billion to help unemployed or underemployed citizens escape foreclosure. Instead, only half of that money went into the program and the rest was returned to the national treasury. Experts say that none of these programs were able to a craft a design that truly worked.
Banks and mortgage brokers have done little to slow the crisis, which is a point of criticism, USA Today reported. These are the same companies that received billions of dollars in federal bailout money, yet seem disinclined to help the troubled American homeowners.
Still, many politicians claim that they did what they could to remedy a problem the country has never faced before. Many claim that the crisis would have been worse had they not taken action.
Meanwhile, foreclosures are stacking up once more. Around 4 million homes are in the foreclosure process or on the brink of it right now. This is alongside the 2.5 million homes that were lost since 2009.
If you are a homeowner facing foreclosure, know that you do have options. Talking to an experienced foreclosure defense attorney in your area can help you to weigh the options and move forward with a plan.
Source: USA Today, "What went wrong with foreclosure aid programs?" Julie Schmit, Dec. 12, 2011
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