Sarasota Real Estate Market News

No big fixes planned for troubled housing market

WASHINGTON – July 19, 2011 – The Obama administration has no plans to introduce another large-scale program for relieving the troubled housing market, despite the president’s recent admission that his past efforts have not solved the problem, according to a senior administration official.

President Obama’s acknowledgment that the weak housing market had become one of his administration’s chief burdens set off industry speculation that there could be another large government offensive to jump-start the sector.

But experts said the government’s options are limited. There isn’t likely to be the money or political will to push through any significant legislation to address the problem, they said. And the evolution of the housing crisis may have pushed it beyond quick policy fixes.

Yet housing remains one of the biggest drags on the economic recovery and threatens to loom over the 2012 election. Millions of borrowers are facing foreclosure, while others are stuck in homes worth less than they owe, leaving them feeling cash-strapped at a time when consumer spending is needed to fuel economic growth.

“There is no money and, to some degree, we have run out of ideas. I have seen them all,” said Mark Zandi, chief economist of Moody’s Analytics. “I don’t think there is something grand that could make a big difference.”

Obama set off the speculation about another large housing program earlier this month during a Twitter town hall when he said that dealing with the aftermath of the housing bubble had been one of his chief challenges. The administration had made progress, he said, but “it’s not enough. And so we’re going back to the drawing board.”

The administration is keeping an eye on how the market is evolving and what is driving distress, said an administration official, who spoke on the condition of anonymity to discuss internal deliberations. An inter-agency group that includes senior officials from the Department of Housing and Urban Development and the Treasury Department continues to collect input from outside groups and members of Congress, the official said.

The administration is not preparing to launch a large new program, but is considering several options including expanding existing efforts, the official said.

The administration already has poured billions of dollars into programs to help homeowners avoid foreclosure, injected millions of dollars into teetering state housing finance agencies and made it easier for borrowers to refinance their loans even if they owe more than their homes are worth.

But most of those efforts have fallen short of expectations. Despite all-time low interest rates, home prices remain near historic lows, sales are weak and a backlog of homes headed to foreclosure could prolong the crisis for years.

“I think the administration has put out quite a number of initiatives over the last couple of years to soften the blow of the [housing] crisis. Those measures did soften the blow,” said Michael S. Barr, a former assistant Treasury secretary in the Obama administration.

But most foreclosures are now caused by economic factors such as unemployment rather than subprime loans, said Barr, a law professor at the University of Michigan. “I don’t think any housing-specific answer is likely to make a significant difference right now. The larger macro issues are more important.”

Still, the administration is being inundated with proposals from advocacy and industry groups for buoying the housing market, including a push to loosen strict lending standards and find ways to turn the foreclosed homes weighing on the market into rental properties. Many also want the administration to force banks to cut the principal balance for borrowers who owe more than their homes are worth, known as being underwater, according to industry officials and consumer advocates.

And not everyone has given up on finding a legislative solution. Sen. Barbara Boxer (D-Calif.) introduced legislation earlier this year that would require Fannie Mae and Freddie Mac, the mortgage financing giants, to allow borrowers who are underwater on their mortgage more flexibility to refinance into lower-interest rate loans without pricey upfront fees. Sen. Johnny Isakson (R-Ga.) recently signed on as a co-sponsor of the legislation, which the lawmakers say could keep 54,000 borrowers out of foreclosure.

The biggest opportunity for wide-ranging change may be a settlement being negotiated between a coalition of state attorneys general and large banks related to flawed foreclosure practices, industry officials and consumer advocates say. Those efforts are aimed at overhauling the industry’s business practices and potentially creating funds that could be used to aid troubled homeowners facing foreclosure.

A provision could be added to the potential settlement requiring banks to write down the balances of underwater borrowers, according to consumer advocates.

Overall, the housing market is suffering from too much supply and not enough demand, said David Stevens, head of the Mortgage Bankers Association. It would take more than nine months to sell all of the homes on the market at the current sales rate, according to industry data. But there are also more than 4 million homeowners in trouble on their mortgage, with many somewhere in the foreclosure process.

But lending standards remain strict, particularly for investors, many of whom have a difficult time qualifying for the government-backed loans that make up a majority of the market, according to Stevens. “We clearly need an investor market to absorb the inventory,” he said.

Some housing experts said that fixing the housing sector may be too big for a single plan.

“New measures can make a difference at the margins and help in specific markets, but it will take more stakeholders working together to achieve the biggest scale” of changes, said Peter P. Swire, a law professor at Ohio State University.

Copyright © 2011 washingtonpost.com

July 29, 2011 Posted by | News related to Short Sales and Foreclosures, News related to the Market | Leave a comment

Housing expected to improve over last year

WASHINGTON – July 19, 2011 – The U.S. housing market, aided by a recovering rental sector, is unlikely to experience a “double-dip” setback, Freddie Mac said Monday.

In its U.S. Economic and Housing Market Outlook for July, the Federal Home Loan Mortgage Corp. said housing likely will follow the performance of the overall economy for the rest of 2011. Additionally, home sales are projected to be above last year’s numbers by 3- to 5 percent.

The report also indicated that despite record levels of homebuyer affordability and historically low mortgage rates, households were concerned about their financial futures and were holding off making major purchases, notably homes.

The rental housing market showed the clearest signs of a turnaround with the apartment property price index showing a 15.2 percent gain over the year through the first quarter of 2011.

“Following June’s labor market report, households are naturally concerned about their financial futures, which is being reflected in the housing market,” said Frank Nothaft, Freddie Mac’s vice president and chief economist. “Yet, the single-family market will likely improve over the balance of 2011, in keeping with positive [gross domestic product] forecasts for the United States.”

Copyright © 2011 United Press International Inc.

July 29, 2011 Posted by | News related to Buyers, News related to Investors, News related to Sellers, News related to the Market | Leave a comment

AP: Mortgage ‘robo-signing’ goes on

WASHINGTON – July 19, 2011 – Mortgage industry employees are still signing documents they haven’t read and using fake signatures more than eight months after big banks and mortgage companies promised to stop the illegal practices that led to a nationwide halt of home foreclosures.

County officials in at least three states say they have received thousands of mortgage documents with questionable signatures since last fall, suggesting that the practices, known collectively as “robo-signing,” remain widespread in the industry.

The documents have come from several companies that process mortgage paperwork, and have been filed on behalf of several major banks. One name, “Linda Green,” was signed almost two dozen different ways.

Lenders say they are working with regulators to fix the problem but cannot explain why it has persisted.

Last fall, the nation’s largest banks and mortgage lenders, including JPMorgan Chase, Wells Fargo, Bank of America and an arm of Goldman Sachs, suspended foreclosures while they investigated how corners were cut to keep pace with the crush of foreclosure paperwork.

Critics say the new findings point to a systemic problem with the paperwork involved in home mortgages and titles. And they say it shows that banks and mortgage processors haven’t acted aggressively enough to put an end to widespread document fraud in the mortgage industry.

“Robo-signing is not even close to over,” says Curtis Hertel, the recorder of deeds in Ingham County, Mich., which includes Lansing. “It’s still an epidemic.”

In Essex County, Mass., the office that handles property deeds has received almost 1,300 documents since October with the signature of “Linda Green,” but in 22 different handwriting styles and with many different titles.

Linda Green worked for a company called DocX that processed mortgage paperwork and was shut down in the spring of 2010. County officials say they believe Green no longer works in the industry. Why her signature remains in use is not clear.

“My office is a crime scene,” says John O’Brien, the registrar of deeds in Essex County, which is north of Boston and includes the city of Salem.

In Guilford County, N.C., the office that records deeds says it received 456 documents with suspect signatures from Oct. 1, 2010, through June 30. The documents, mortgage assignments and certificates of satisfaction, transfer loans from one bank to another or certify a loan has been paid off.

Suspect signatures on the paperwork include 290 signed by Bryan Bly and 155 by Crystal Moore. In the mortgage investigations last fall, both admitted signing their names to mortgage documents without having read them. Neither was charged with a crime.

And in Michigan, a fraud investigator who works on behalf of homeowners says he has uncovered documents filed this year bearing the purported signature of Marshall Isaacs, an attorney with foreclosure law firm Orlans Associates. Isaacs’ name did not come up in last year’s investigations, but county officials across Michigan believe his name is being robo-signed.

O’Brien caused a stir in June at a national convention of county clerks by presenting his findings and encouraging his counterparts to investigate continued robo-signing.

The nation’s foreclosure machine almost came to a standstill when the nation’s largest banks suspended foreclosures last fall. Part of the problem, banks contended, was that foreclosures became so rampant in 2009 and 2010 that they were overwhelmed with paperwork.

The banks reviewed thousands of foreclosure filings, and where they found problems, they submitted new paperwork to courts handling the cases, with signatures they said were valid. The banks slowly started to resume foreclosures this winter and spring.

The 14 biggest U.S. banks reached a settlement with federal regulators in April, in which they promised to clean up their mistakes and pay restitution to homeowners who had been wrongly foreclosed upon. The full amount of the settlement has not been determined. But it will not involve independent mortgage processing firms, the companies that some banks use to handle and file paperwork for mortgages.

So far, no individuals, lenders or paperwork processors have been charged with a crime over the robo-signed signatures found on documents last year. Critics such as April Charney, a Florida homeowner and defense lawyer, called the settlement a farce because no real punishment was meted out, making it easy for lenders and mortgage processors to continue the practice of robo-signing.

Robo-signing refers to a variety of practices. It can mean a qualified executive in the mortgage industry signs a mortgage affidavit document without verifying the information. It can mean someone forges an executive’s signature, or a lower-level employee signs his or her own name with a fake title. It can mean failing to comply with notary procedures. In all of these cases, robo-signing involves people signing documents and swearing to their accuracy without verifying any of the information.

Most of the tainted mortgage documents in question last fall were related to homes in foreclosure. But much of the suspect paperwork that has been filed since then is for refinancing or for new purchases by people who are in good standing in the eyes of the bank. In addition, foreclosures are down 30 percent this year from last. Home sales have also fallen. So the new suspect documents come at a time when much less paperwork is streaming through the nation’s mortgage machinery.

None of the almost 1,300 suspect documents signed by Linda Green that O’Brien’s has in his office, for example, involve foreclosures. And Jeff Thigpen, the register of deeds in North Carolina’s Guilford County, says fewer than 40 of the 456 suspect documents filed to his office since October involved foreclosures.

Banks and their partner firms file mortgage documents with county deeds offices to prove that there are no liens on a property, that the bank owns a mortgage or that a bank filing for foreclosure has the authority to do so.

The signature of a qualified bank or mortgage official on these legal documents is supposed to guarantee that this information is accurate. The paper trail ensures a legal chain of title on a property and has been the backbone of U.S. property ownership for more than 300 years.

The county officials say the problem could be even worse than what they’re reporting. That’s because they are working off lists of known robo-signed names, such as Linda Green and Crystal Moore, that were identified during the investigation that began last fall. Officials suspect that other names on documents they have received since then are also robo-signed.

It is a federal crime to sign someone else’s name to a legal document. It is also illegal to sign your name to an affidavit if you have not verified the information you’re swearing to. Both are punishable by prison.

In Michigan, the attorney general took the rare step in June of filing criminal subpoenas to out-of-state mortgage processing companies after 23 county registers of deeds filed a criminal complaint with his office over robo-signed documents they say they have received. New York Attorney General Eric Schneiderman’s office has said it is conducting a banking probe that could lead to criminal charges against financial executives. The attorneys general of Delaware, California and Illinois are conducting their own probes.

The legal issues are grave, deeds officials across the country say. At worst, legal experts say, the document debacle has opened the property system to legal liability well beyond the nation’s foreclosure crisis. So someone buying a home and trying to obtain title insurance might be delayed or denied if robo-signed documents turn up in the property’s history. That’s because forged signatures call into question who owns mortgages and the properties they are attached to.

“The banks have completely screwed up property records,” says L. Randall Wray, an economics professor and senior scholar at the University of Missouri-Kansas City.

In the Massachusetts case, The Associated Press tried to reach Linda Green, whose name was purportedly signed 1,300 times since October. The AP, using a phone number provided by lawyers who have been investigating the documents since last year, reached a person who said she was Linda Green, but not the Linda Green involved in the mortgage investigation.

In the Michigan case, a lawyer for the Orlans Associates law firm, where Isaacs works, denies that Isaacs or the firm has done anything wrong. “People have signatures that change,” says Terry Cramer, general counsel for the firm. “We do not engage in ‘robo-signing’ at Orlans.”

To combat the stream of suspect filings, O’Brien and Jeff Thigpen, the register of deeds in North Carolina’s Guilford County, stopped accepting questionable paperwork June 7. They say they had no choice after complaining to federal and state authorities for months without getting anywhere.

Since then, O’Brien has received nine documents from Bank of America purportedly signed by Linda Burton, another name on authorities’ list of known robo-signers. For years, his office has regularly received documents signed with Burton’s name but written in such vastly different handwriting that two forensic investigators say it’s highly unlikely it all came from the same person.

O’Brien returned the nine Burton documents to Bank of America in mid-June. He told the bank he would not file them unless the bank signed an affidavit certifying the signature and accepting responsibility if the title was called into question down the road. Instead, Bank of America sent new documents with new signatures and new notaries.

A Bank of America spokesman says Burton is an assistant vice president with a subsidiary, ReconTrust. That company handles mortgage paperwork processing for Bank of America.

“She signed the documents on behalf of the bank,” spokesman Richard Simon says. The bank says providing the affidavit O’Brien asked for would have been costly and time-consuming. Instead, Simon says Bank of America sent a new set of documents “signed by an authorized associate who Mr. O’Brien wasn’t challenging.”

The bank didn’t respond to questions about why Burton’s name has been signed in different ways or why her signature appeared on documents that investigators in at least two states have deemed invalid.

Several attempts by the AP to reach Burton at ReconTrust were unsuccessful.

O’Brien says the bank’s actions show “consciousness of guilt.” Earlier this year, he hired Marie McDonnell, a mortgage fraud investigator and forensic document analyst, to verify his suspicions about Burton’s and other names on suspect paperwork.

She compared valid copies of Burton’s signature with the documents O’Brien had received in 2008, 2009 and 2010 and found that Burton’s name was fraudulently signed on hundreds of documents.

Most of the documents reviewed by McDonnell were mortgage discharges, which are issued when a home changes hands or is refinanced by a new lender and are supposed to confirm that the previous mortgage has been paid off. Bank of America declined comment on McDonnell’s findings.

In Michigan, recorder of deeds Hertel and his counterparts in 23 other counties found numerous suspect signatures on documents filed since the beginning of the year.

In June, their findings led the Michigan attorney general to issue criminal subpoenas to several firms that process mortgages for banks, including Lender Processing Services, the parent company of DocX, where Linda Green worked. On July 6, the CEO of that company, which is also under investigation by the Florida Attorney General’s office, resigned, citing health reasons.
AP LogoCopyright © 2011 The Associated Press, Michelle Conlin and Pallavi Gogoi, AP business writers. All rights reserved.

July 29, 2011 Posted by | News related to Short Sales and Foreclosures | Leave a comment

Free advice to help owners keep their homes

WASHINGTON – July 18, 2011 – Free counseling can help struggling homeowners try to find ways to keep their homes: The U.S. Department of Housing and Urban Development (HUD) provides a list of government-approved counselors on its website, hud.gov.

The counselors often know of special programs that lenders don’t, said Kevin Maher, director of community education for the nonprofit Consumer Credit Management Services in Delray Beach, Fla.

His counseling agency was among those giving free help recently to hundreds who stood in line at a Help for Homeowners Community Event in Hollywood, Fla. The event brought out an overflowing crowd: 1,333 homeowners when organizers had only expected about 1,000.

Counselors know about HUD, Fannie Mae and Freddie Mac programs, Maher said. They also keep up-to-date on what local agencies are offering.

If people are in foreclosure, the courts offer free mediation, added Diane Stephenson, foreclosure prevention services manager at Maher’s Consumer Credit agency. “It’s in the best interests of the people to take advantage of the mediation,” she said.

There are also programs to help the unemployed or underemployed, Maher said.

The Obama Administration has a new program, starting Aug. 1, that will give unemployed homeowners with FHA loans a break on part or all of their mortgage payments for up to 12 months.

To qualify, the unemployed will have to be 90-days delinquent on their loans, said Brian Sullivan, a U.S. Housing and Urban Development spokesman.

Those mortgage companies participating in the Making Home Affordable Program will also be required to give the year-long reprieve “whenever possible,” according to a HUD statement.

© 2011 Sun Sentinel. Distributed by McClatchy-Tribune News Service, Donna Gehrke-White.

July 29, 2011 Posted by | News related to Short Sales and Foreclosures | Leave a comment

What does the future hold for jumbo loans?

NEW YORK – July 18, 2011 – The private market is ready to fill the void when conforming limits on government-backed mortgages at Fannie Mae, Freddie Mac, and the Federal Housing Administration expire at the end of September 2011, Federal Reserve Chairman Ben Bernanke told the House Financial Services Committee on Wednesday.

On Oct. 1, the maximum mortgage amount in high-cost areas is set to drop from $729,750 to $625,500.

“As far as Fannie Mae and Freddie Mac are concerned, there is a tradeoff there between supporting the higher-priced homes and weaning the housing finance system off of unusual limits it was put under during the crisis,” Bernanke told the House committee. “I understand the private sector is taking at least a significant number of the jumbo mortgage market but at a higher cost.”

The National Association of Home Builders has said that it fears more than 17 million homes nationwide will become ineligible for more affordable federal funding when the loan limit expires.

While Bernanke acknowledges that jumbo loans will likely come “at a higher cost,” he said that needs to be kept in perspective.

“Mortgage rates on conforming loans are already near historic lows, hovering around 4.5 percent on the 30-year fixed,” he said.

Source: “Bernanke: Private Sector Ready for Conforming Loan Limit Drop,” HousingWire (July 13, 2011) and “Lower Mortgage Limits Are a ‘Trade-Off’ Bernanke Says,” CNBC (July 13, 2011)

July 29, 2011 Posted by | News related to Financing | Leave a comment

Homeowners learn how to fight foreclosure process during workshop

…If the homeowner doesn’t respond to foreclosure paperwork the bank will file for a deficiency judgment. If the bank wins it can go after payments form the ex-homeowner for 20 years. With a deficiency judgment the bank is allowed to garnish the ex-homeowner’s wages to obtain the money it lost when the house was sold for less than was owed on it.

Read More HERE

July 29, 2011 Posted by | News related to Short Sales and Foreclosures | Leave a comment

Fixed mortgage rates fall toward 2011 lows

WASHINGTON – July 15, 2011 – Fixed mortgage rates fell this week, and the rate on the 15-year loan dropped to its lowest point of the year.

The average rate on the 30-year loan decreased to 4.51 percent from 4.60 percent a week ago, Freddie Mac said Thursday. It reached its yearly low a month ago, at 4.49 percent.

The average rate on the 15-year fixed mortgage, popular for refinancing, fell to 3.65 percent from 3.75 percent. Its previous low this year was 3.67 percent, reached three weeks ago.

Rates typically track the yield on the 10-year Treasury note. Yields fell sharply last week after dismal jobs data pushed investors into the safety of government bonds. Yields fall as prices rise.

Low mortgage rates and depressed home values have done little to revive the struggling housing market. Many people can’t take advantage of the low rates because of tighter lending standards and higher downpayment requirements. Lenders are cautious because the weak economy and high unemployment make it more likely that some borrowers will default.

Other potential homebuyers are holding off, concerned that housing prices will continue to fall.

Few economists expect the housing market to rebound before 2013.

To calculate average mortgage rates, Freddie Mac collects rates from lenders across the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a single day.

The average rate on a five-year adjustable-rate mortgage edged down to 3.29 percent from 3.30 percent last week. Two weeks ago, it hit 3.25 percent, its lowest level on records dating back to 2005. The average rate on the one-year adjustable loan fell to 2.95 percent, a record low, from 3.01 percent.

The rates do not include extra fees known as points. One point is equal to 1 percent of the total loan amount.

The average fees for the 30-year loans were unchanged at 0.7, according to Freddie Mac’s survey. Average fees for the 15-year fixed loan and the five-year ARM were 0.6. The average fees for the one-year ARM fell to 0.5.
AP LogoCopyright © 2011 The Associated Press, Daniel Wagner, AP business writer. All rights reserved.

July 29, 2011 Posted by | News related to Financing | Leave a comment

Foreclosure activity slowed in first half of 2011

LOS ANGELES (AP) – July 14, 2011 – The number of homes taken back by lenders in the first half of this year fell 30 percent compared with the same 2010 period, the result of delays in foreclosure processing that threatens to stall a U.S. housing recovery.

Banks seized 421,212 homes in the first six months of the year, down from 529,633 between January and June last year, foreclosure listing firm RealtyTrac Inc. said Thursday.

The decline reflects lenders taking longer to move against homeowners who have fallen behind on their mortgage payments. The banks are working through foreclosure documentation problems that first surfaced last fall and an ensuing logjam in some state courts. Lenders also have put off on taking action against delinquent borrowers as U.S. home sales have slowed this year.

As the processing delays mount, however, so has the backlog of potential foreclosures – homes that otherwise would have been repossessed by lenders this year.

RealtyTrac estimates that 1 million foreclosure-related notices that should have been filed by banks this year will be pushed to next year. The filings include notices for defaults, scheduled home auctions and home repossessions – warnings that can lead to a home eventually being lost to foreclosure.

The delayed filings buy more time for many borrowers behind in payments to remain in their homes, perhaps giving them time to catch up or simply to stall their inevitable eviction. But it also means any eventual foreclosures will happen next year, extending the shadow of distressed properties that hovers over the market.

“The best-case scenario is we don’t get back to normal levels of foreclosure activity until 2015, which means the housing market recovery gets delayed by at least a year,” said Rick Sharga, a senior vice president at RealtyTrac.

And given delays in the time it’s taking lenders to move a home from default to foreclosure and then sell the property, the housing turnaround could conceivably be pushed out to as late as 2016, Sharga said.

“It could be the new reality is we’re going to have to accept the fact that home prices in most markets aren’t going to budge much for the next several years while this overhang gradually, painfully makes its way into the market and gets purchased,” he said.

In all, some 1.2 million U.S. homes received a foreclosure-related notice in the first six months of this year, RealtyTrac said.

That’s down 29 percent from the same period last year and down 25 percent versus the second half of 2010.

Put another way, one in every 111 U.S. households received a foreclosure filing between January and June.

In addition to repossessing fewer homes, banks also fired off 36 percent fewer initial notices of default in the first half of this year than in the same period last year. The notices are the first step in the foreclosure process.

Foreclosure activity did pick up slightly between May and June, although lenders repossessed fewer homes than they did in June last year.

At the current pace, banks are on track to take back between 800,000 and 900,000 homes this year, down from a record of 1 million lost to foreclosures last year, Sharga said.

The firm had originally anticipated some 1.2 million homes would be repossessed by lenders this year.

Foreclosures typically sell at a discount to other types of homes, weighing down home values. As a result, housing experts say U.S. home prices are unlikely to recover until the glut of foreclosed homes on the market is cleared out.

Lenders have been careful not to unload all of their foreclosures on the market at once, and have financial incentives to continue doing so. But the prospect of more foreclosures hitting the market for years to come makes it difficult to predict when home values will stabilize. And that keeps many would-be homebuyers on the sidelines.

Between April and June, it took an average of 318 days for a home to go from the first stage of foreclosure to the point where it was sold at auction or taken back by the lender, RealtyTrac said. That’s up from 298 days in the first three months of the year and up from 277 days in the second quarter of last year.

The foreclosure process took longest to play out in New York at an average of 966 days, or 2.6 years, during the second quarter. New Jersey was second-slowest at an average of 944 days, RealtyTrac said.

Homes were on a relative foreclosure fast-track in Texas, taking an average of 92 days to go through the process, the fastest turnaround time in the nation.

Despite slowdown in foreclosure activity, several states continue to have outsized foreclosure rates. Nevada continued to lead the nation, with one in every 21 households receiving a foreclosure notice in the first half of this year.

Rounding out the top 10 states with the highest foreclosure rate in the first half of this year are Arizona, California, Utah, Georgia, Idaho, Michigan, Florida, Colorado and Illinois.
AP LogoCopyright © 2011 The Associated Press, Alex Veiga, AP real estate writer

July 29, 2011 Posted by | News related to Short Sales and Foreclosures | Leave a comment

Hundreds in Hollywood wait in line for help to save their homes

HOLLYWOOD, Fla. – July 13, 2011 – Some homeowners emerged jubilant from the Westin Diplomat Resort on Monday, snagging instant mortgage modifications during a daylong event in Hollywood.

Others weren’t as lucky.

In the first two hours, 612 people applied for help from the Help for Homeowners Community Event that was sponsored by the federal government’s Making Home Affordable Program. Struggling homeowners formed lines to register and then to meet with loan officers or counselors at the resort.

“It goes to show you that a lot of South Florida homeowners are struggling,” said Andrea Risotto, a spokeswoman for the U.S. Treasury that was helping oversee the event.

She blamed the sour job market. Most interviewed said they had lost jobs and fallen behind on payments. Florida’s unemployment rate is 10.6 percent, much higher than the national average.

Mercy Del Toro of Miami said she and her family were among the lucky ones. Their lender combined two home loans into one with a lower interest rate, she said. The new loan has lower payments, to be made over a longer time.

“We will be able to stay in our home,” a beaming Del Toro said.

The amount owed stays the same. “That’s the bad news,” Del Toro said.

Marva Gyles of Fort Lauderdale said she is still waiting to see what happens with her loan. Her lender said Monday that she qualified for a loan modification, but she didn’t have anything firm yet.

“I’ve been down this road before,” she said. Indeed, many South Floridians have become frustrated at attending events or applying for programs that don’t deliver promised loan relief. After two years of seeking help, Gyles said she still hadn’t been able to modify her loan. Meanwhile, she lost a job but found a new one.

Getting a more affordable loan will help her get back to a normal life, she said.

Lily Calderon, of Pompano Beach, said she and her husband, Oscar, don’t even have a promise of a loan modification.

She has been out of work as a customer service representative for two years. She and her husband were told Monday by their lender that they couldn’t qualify for help. “We don’t have enough income,” he said.

Even if their loan were modified, the couple wouldn’t be able to afford a new mortgage payment, they were told. “But I can’t get a job,” Lily Calderon said. “It’s like a circle.”

Treasury spokeswoman Risotto said part of Monday’s program was to connect struggling homeowners with people they can contact at their lenders. Homeowners have complained about banks repeatedly losing documents and not having anyone to check on the status of an application to modify a loan.

Homeowners also could meet with housing counselors at nonprofit agencies that offer services free and are certified by the federal government to provide housing information, said Brad Dwin, spokesman for the nonprofit Hope Now that was created by lenders, investors, counselors and others.

For those who couldn’t attend Monday’s meeting, help is not out of reach.

Hud.gov has an online list of free government-approved counselors, said Kevin Maher, director of community education for the nonprofit Consumer Credit Management Systems in Delray Beach.

The counselors may know of special programs that banks don’t, Maher said. For example, Palm Beach County has programs to help some struggling homeowners, he said.

The state also has $1 billion in the Florida Hardest Hit program to give people up to $18,000 for up to six months of mortgage payments, Maher said.

The Obama administration also has a new program, starting Aug. 1, that will give unemployed homeowners with FHA loans a break on part or all of their mortgage payments for up to 12 months.

To qualify, the unemployed will have to be 90 days delinquent on their loans, said Brian Sullivan, a U.S. Housing and Urban Development spokesman.

Those mortgage companies participating in the Making Home Affordable Program also will be required to give the yearlong reprieve “whenever possible,” according to a HUD statement.

Copyright © 2011 Sun Sentinel, Fort Lauderdale, Fla., Donna Gehrke-White, Sun Sentinel, Fort Lauderdale, Fla. Distributed by McClatchy-Tribune Information Services

July 29, 2011 Posted by | News related to Short Sales and Foreclosures | Leave a comment

Making move from Realtor to investor

PANAMA CITY BEACH, Fla. – July 12, 2011 – The housing slump has prevented many people from buying a house, prompting them instead to be renters.

That in turn has created a shortage of good rental property, keeping rents high, something that can prove to be profitable for some homeowners and investors.

Bruce King is a Realtor who owns several rental properties. He is one of the owners of a Gulf-front home that rents for $3,300 a month.

There are two main types of rental properties in Bay County: weekly vacation rentals with lots of turnover and the generally more stable but potentially less profitable long-term rentals. High returns can be made renting King’s Gulf-front home on Thomas Drive as a weekly beach rental, but the owners and investors of the property want some stability with a long-term renter.

“Having a weekly rental is a full-time job,” said King, who has almost a dozen rental properties.

King said if he and his fellow investors in the property wanted to rent the house weekly they could rent it for as much as $5,000 a week, but that the wear and tear would be much greater. The house was vacated by the previous renter of four years in June, but the property did not remain available for long, and new tenants are moving in Aug. 1.

When homeowners lose their homes or potential buyers get denied a loan, they hit the rental market looking for a place to live. There is a plethora of single-family homes on the market for sale, but there is a shortage of good rental property on the market.

“We have not seen vacancy this low in a while,” said Joe Scaperotta, owner of Scaperotta Real Estate and Development, who also manages property.

Homeowners not only can choose to rent short or long term but also can decide to manage property themselves or hire a management company. Scaperotta’s company manages about 100 properties in Panama City and Panama City Beach.

Scaperotta’s company acts as a concierge service for homeowners to help get property rented, cleaned and maintained throughout the rental term. King and Scaperotta agree renting property, especially while being in a different town, can be difficult.

“When hiring a management company, homeowners need to interview and talk to the management company and set the details, and it’s more than just price” Scaperotta said. “It’s an ongoing relationship.”

Chan Lipscomb manages single-family houses mainly in Panama City. He looks for what he calls “everyday” houses that he can buy and manage.

“It appears that the rental market is growing,” Lipscomb said. “Credit is no longer easier to come by, and those caught up in high interest loans are coming back into the rental market.”

Managing rental properties is a good business, said Lipscomb, who is aggressively looking for more property to rent.

Lipscomb has been a landlord since 1996 and he said his experiences overall have been positive, something he attributes to his properties. He only looks at single-family homes as rental properties; he steers away from apartment, condos and trailers.

“Most renters want a house, and they will spend a little more money for the privacy,” Lipscomb said. “These are the folks that are more stable renters.”

Property managers and landlords agreed checking renters for their job, credit, criminal and rental history were all important to determining if they were good candidates.

Lipscomb has a policy against renting property to owners of aggressive dog breeds; he once had a renter whose dog attacked a neighborhood child.

“The key to property management is to be upfront,” Scaperotta said. “Do your homework upfront on the renter.”

Some of the red flags, according to Scaperotta, are renters who are aggressive in negotiating the price, the security deposit or ask if credit checks are conducted.

“Make sure you are covered and get a security deposit,” King said, “especially for the more expensive properties. If renters cannot cover the first and last months’ rents, they probably cannot afford the property.”

King recommended being careful renting to friends and taking friends as references for renters. One of the worst deals King has had during his nearly 10 years of being a landlord occurred when renting a house to the acquaintance of one of his friends.

“No matter how much people seem worthy, my sound advice is to run a background and credit check,” King said.

“When you pick your property, you pick your potential renters,” Lipscomb said. “You can’t get good people to live in a bad property or a bad location.”

Copyright © 2011 The News Herald, Panama City, Fla., Chris Segal. Distributed by McClatchy-Tribune Information Services.

July 29, 2011 Posted by | News related to Buyers, News related to Investors, News related to the Market | Leave a comment