Credit Cards Mojo » Mortgage

Why sloppy foreclosure process could ruin Florida

Staff Writer — Sun, 03 Oct 2010 19:45:03 +0000

There’s no polite way to put this. A growing cancer is infecting the backlogged legal process of foreclosing on hundreds of thousands of homes in Florida.

It’s endangering the legal and economic stability of this state. And it’s exposing an appalling lack of leadership, first for allowing such a breakdown in the legal system and, now, for failing to own up to this mess and get it fixed.

How bad is it? Laws governing who actually owns a foreclosed home are becoming so suspect a new buzzword is emerging: blighted titles. Even the tepid rebound of Florida’s economy may face crippling delays in resolving hundreds of thousands of foreclosures in the Sunshine State.

The Truth About Short Sales and Their Impact on Your Credit

Staff Writer — Tue, 28 Sep 2010 01:40:29 +0000

One of the most frightening titles you can own right now is “homeowner.” That’s because millions of us have completely lost the equity in our homes, which means we are in the unenviable position of owing more than the home is actually worth. Nobody asks for their home’s value to fall, but plenty of homeowners are now in the position of trying to dispose of mortgages that are considered upside-down.

There are several ways to do this. First, you can actually find someone willing to buy your house for enough dough to cover all of the mortgages it secures. NOTE: That’s probably not going to happen so proceed to Option #2. Option #2 is to pay the difference out of your own pocket. So, if you owe $150,000 and find a buyer at $125,000 you’d have to show up at closing with a check for $25,000 to cover the difference. If that’s not an option then you can walk away from the home (foreclosure), turn the keys back over to the lender (forfeiture of deed in lieu of foreclosure), or attempt to have the loan modified and stay in the property. Finally, you can attempt to short sell the home.

A short sale is when the lender accepts less than the full loan balance and considers the loan to be paid. So, in the aforementioned example, if the lender had accepted $125,000 as a full payoff then you would have been on your way to a successful short sale. The lender would eat the $25,000 deficiency and everyone would call it a day. But it’s not that simple. There’s the impact this event will likely have on your credit.

More Bad News For Housing, As Foreclosures Gather Steam Again

Staff Writer — Sun, 19 Sep 2010 00:11:05 +0000

Are we seeing the next wave of the housing decline that everyone’s been waiting for?

Foreclosure activity — which would certainly be a key spur — is back on the rise, says RealtyTrac:

RealtyTrac the leading online marketplace for foreclosure properties, today released its U.S. Foreclosure Market Report™ for July 2010, which shows that foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 325,229 properties in July, a nearly 4 percent increase from the previous month but a nearly 10 percent decrease from July 2009. One in every 397 U.S. housing units received a foreclosure filing during the month. . . .

Explaining Subprime Derivatives

Staff Writer — Sat, 04 Sep 2010 12:40:51 +0000

Post from: Credit Cards Mojo

Explaining Subprime Derivatives

Banks Playing ‘Foreclosure Roulette’ With Delinquent Homeowners

Staff Writer — Thu, 02 Sep 2010 13:07:00 +0000

Bea Garwood has been bracing for foreclosure since May, but she says she’s been told three times to expect a sheriff’s sale in the next month and it still hasn’t happened.

“We really at this point do not know where we are in the process,” said Garwood, who lives in Pinckney, Mich. with her husband. “We have no clue. We haven’t even heard from Chase bank in three weeks.”

The Garwoods may have had a lucky spin in the game that industry analyst Sean O’Toole calls “Foreclosure Roulette.”

Banks don’t want to recognize losses by having to put homes on the market at foreclosure-sale prices, but they don’t want to encourage borrowers to quit making payments either, so, O’Toole believes, they randomly foreclose on some people to prevent widespread “moral hazard.” The rest are left hanging with the help of the government’s “extend and pretend” approach to the collapse of the housing bubble.

“We just don’t have the political appetite to bail homeowners out,” said O’Toole, CEO of ForeclosureRadar.com. “On the other hand, we don’t have the political appetite to kick them out.”

Owners Stop Paying Mortgages, and Stop Fretting

Staff Writer — Wed, 02 Jun 2010 04:39:00 +0000

ST. PETERSBURG, Fla. — For Alex Pemberton and Susan Reboyras, foreclosure is becoming a way of life — something they did not want but are in no hurry to get out of.

Foreclosure has allowed them to stabilize the family business. Go to Outback occasionally for a steak. Take their gas-guzzling airboat out for the weekend. Visit the Hard Rock Casino.

“Instead of the house dragging us down, it’s become a life raft,” said Mr. Pemberton, who stopped paying the mortgage on their house here last summer. “It’s really been a blessing.”

A growing number of the people whose homes are in foreclosure are refusing to slink away in shame. They are fashioning a sort of homemade mortgage modification, one that brings their payments all the way down to zero. They use the money they save to get back on their feet or just get by.

This type of modification does not beg for a lender’s permission but is delivered as an ultimatum: Force me out if you can. Any moral qualms are overshadowed by a conviction that the banks created the crisis by snookering homeowners with loans that got them in over their heads.

Its The Banks, Stupid — And Us, And…

Staff Writer — Sun, 18 Apr 2010 01:18:05 +0000

We’ve heard much of it: Mortgage backed securities i.e. bonds, touted as spreading the risk for high-risk, would-be home owners to abet home owning, but relieving the lending banks of the risk of default by off loading that risk to the bond holders. Credit default swaps, called swaps after intense lobbying by the big banks to avoid the name “insurance,” to avoid being required to hold reserves against prospective losses. Rating agencies paid by the very companies whose credit-worthiness they rate. The finance committees of both Houses of Congress that, according to Bill Moyer’s journal, received $120,000,000.

Names should be named: Alan Greenspan explained to Congress recently that he had no effective influence on Congress. But he and Larry Summers successfully helped block in Congress a Clinton Administration effort to investigate the derivatives market. No influence? My foot. Greenspan lobbied for giant Pimco after he stepped down as Fed Chairman, to save a class of Fannie May bond holder’s bonds. One wonders just what fee was earned. Larry Summers earned several million consulting for a hedge fund while President of Harvard. He is President Obama’s Economic Advisor. If he now favors “regulation”, where was he when he argued to Congress against investigating the derivative market? It seems no one was responsible. No one. Greenspan, Summers, our Treasury Secretary, the presidents of the big banks. Our Titans were, well, so persuaded of their world view, or so greedy, that they were blinded. But look at the havoc they have wrought. Is that accepting responsibility? Is that “leadership?” Is that moral? I don’t notice that the answer is “Yes.”

More Homeowners Fall Behind on Mortgages

Staff Writer — Mon, 23 Nov 2009 12:12:21 +0000

About one in seven American households with mortgages is behind on payments or in foreclosure, according to new data from the Mortgage Bankers Association. That is up from about one in 10 a year ago.

The group reported Thursday that 14.4% of first-lien mortgages on one-to-four-family homes in the third quarter were 30 days or more overdue or in the foreclosure process. That is the highest rate since the MBA began reporting such data in 1972, and works out to about 7.5 million households at risk of losing homes. The percentage is up from 10% a year earlier and 7.3% two years ago.

Loan defaults have been rising swiftly for more than three years. At first, the problem largely reflected loose lending practices during the housing boom that allowed millions of people to buy homes they couldn’t afford. Now the problem is compounded by rising unemployment, which hit 10.2% in October, the highest since 1982.

Problem mortgages hit new high at 14 percent

Staff Writer — Mon, 23 Nov 2009 12:06:49 +0000

Data mean foreclosures may not peak until next year

More than 14 percent of borrowers were in trouble on their mortgage during the third quarter, a new record, according to an industry survey released Thursday, which also suggests that the foreclosure rate is likely not to peak until next year as unemployment rates continue to rise.

Unemployment remains a big driver of the problem, according to the Mortgage Bankers Association, which conducts the survey. Those with delinquent loans now include a growing portion of people traditionally considered creditworthy and people whose mortgages are insured by the Federal Housing Administration.

“The outlook is that delinquency rates and foreclosure rates will continue to worsen before they improve,” said Jay Brinkmann, the group’s chief economist.

About 9.6 percent of borrowers were delinquent on their mortgage during the third quarter, according to the survey, and another 4.5 percent more were somewhere in the foreclosure process. Overall, about 14 percent of mortgage loans or 7.4 million households were delinquent or in the foreclosure process during the quarter, according to the group.

Google Tackles Mortgage Market With New Comparison Ads

Staff Writer — Fri, 30 Oct 2009 02:22:46 +0000

Google has just debuted a new form of advertising called AdWords Comparison Ads — a special kind of ad that will prompt users to view a list of sponsored products in a structured format. To get started, Google is running the ads for queries related to the mortgage market, though it has plans to eventually expand beyond that. The ads are in a limited rollout for now, with only some users in some states seeing them.

Here’s how Google describes the new ad type:

AdWords uses a host of targeting and relevancy signals to determine the best ads for each query. However, sometimes a user’s query doesn’t provide enough information for us to confidently predict what they want. Take, for example, users who search for “mortgage.” Do they want a new home loan or a refinance? Do they want a fixed rate or an adjustable rate loan? Comparison Ads improves the ad experience on Google.com by letting users specify exactly what they are looking for and helping them quickly compare relevant offers side by side.

Users searching for “mortgage” on Google.com may see a promotion from Comparison Ads prompting them to select the type of loan they are looking for and to compare various rates.

If they click the promotion, users are taken to a page with more detailed sponsored results. They can choose directly from the offers listed on that page, or they can further refine their search by providing additional information like income and home value…

Once users find an offer that matches their specific needs, they can either call you directly or request a quote. If a user requests a quote, Google automatically anonymizes the user’s phone number and sends you a unique code that you can use to contact the user. You only pay if a user calls the phone number on your offer or fills out a form to request a quote.