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Fannie and Freddie Suspend Foreclosures

by Jeremy Larkin

This is straight from CNN.com:

NEW YORK (CNNMoney.com) -- Mortgage giantsFannie Mae and Freddie Mac have directed their network of servicers to halt all foreclosure and eviction proceedings between Nov. 26 2008 and Jan. 9, 2009, meant to give a recently announced rescue plan time to work.

The Streamlined Modification Program, set to launch Dec. 15, enables delinquent borrowers to get a modified mortgage that lowers payments to no more than 38% of their gross incomes.

"By delaying these foreclosure sales, the nation's servicers will have the opportunity to work with more borrowers who could qualify for a modification under the new [program]," said Freddie Mac CEO David M. Moffett in a statement.

Hmmmm.....like so much of the news we have seen lately, this news leaves homeowners saying "that sounds great, but what does it REALLY mean for me?"

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This was interesting:

Freddie has told its servicers to immediately contact the 6,000 borrowers who already have auction sales or evictions scheduled for between the specified dates to tell them the sales are postponed. Fannie estimated that 10,000 of its borrowers will be affected. Borrowers facing eviction between Nov. 20 and Nov. 26 were not expected to get relief.

 

 

As an Industry Professional, it is truly a crazy time. We are being contracted to do things that would have made your head spin had we mentioned 3 years ago. One of those tasks is a "Home Retention Consulation."

This is a process in which licensed agents, like myself, are contracted with to go and contact homeowners who are #1 - in default on their loan, and #2 - not responding to lender contact about the situation.

I was contracted with this past week to work with a group called "Titanium Solutions" to do just this. The goal is to first make contact, and ultimately assist the borrower in making a loan modification, much like that described above, so they can keep the home. It's better for the bank, and if the borrower can get their finances in order, much better for them and their credit. Everyone wins, really.

"Home Loan Consultant'......who would have THUNK it?!?!?!? Stay tuned for more!

Full article HERE.

 

 

If I Gave You $10,000 to Buy a House Would You Do It?

by Jeremy Larkin

If you were a prospective buyer (which you may be), it would be a no-brainer right? THEN WHAT ARE YOU WAITING FOR?

 

“Buyer’s Markets” are very interesting because ironically, Buyers tend to NOT buy but instead WAIT (and miss out on opportunity.) Conversely, in a “Seller’s Market” most

Buyers can’t seem to control the impulse to buy (and make very stupid mistakes – just see what happened to Hitler HERE).

 

This $10,000 deal is not a hoax by the way, it is actually a TEMPORARY (meaning this WILL go away when they run out of money) down payment assistance program being put on by the City of St.George. / Five County Assoc. of Governments.

If you add that to the $7500.00 tax credit (which must be paid back so ask us about this), being offered by the Federal Govt…you’ve got a lot of incentive to buy a home right now.

 

Here is an email I received earlier this morning from one of our very favorite lenders, Blake Bench of Countrywide:

 

Let me get on a soap box for a second and talk about first time buyers.  I know that consumer confidence is scary low right now and people don't want to do anything but the media may be hiding some real opportunities.

 

I put a deal together yesterday for a first time buyer with a 610 credit score.  He has limited money in the bank for a down payment.  I hooked him up with a $10,000 down payment assistance program for a house in the city of St. George.

 

Couple that with the $7,500 tax credit he will get and we are talking about $17,500 of interest free money that we are getting this kid to buy a house. To me that is a total NO BRAINER.

 

Here is why buyers need to act soon.  If they wait until 2009 to buy they will have to wait until 2010 to get their tax credit.  The $10,000 tax credit is available until the organization runs out of money.  If they don't get it now while it is available they may never get it.

 

That all said, I can’t make a decision for a buyer as to whether we have “hit bottom” or if this is the “right time.” I simply know #1 - these kinds of opportunities only come in seasons, and #2 – If you forego those grants, PLUS interest rates climb 1% in the next year, you may need the market to fall another 20-30% to make up the difference! (see an analysis of something similar HERE).

 

The basics:

  • This program is ONLY available in the St. George City Limits
  • Sale price limit of $301,083
  • Is a non-interest loan payable when you sell or refinance, but after 15 yrs is forgiven!
  • Income limits apply

You can email me or Blake direct with questions about the program. If you want to see a copy of the guidelines, we will also send that to you. Blake_Bench@Countrywide.Com or larkin@gostgeorge.com.

 

In the meantime, tell your friends and family about it – they will thank you!

 

Hitler Loses McMansion to Foreclosure.....

by Jeremy Larkin

WOW. One morning you wake up and realize that your alleged home equity is gone, you are faced with losing your cars, boat & TV that you bought on a HELOC, and your former realtor or mortgage broker is now serving coffee at Denny's.....ouch.

Every once in a while you see or hear something that absolutely knocks you off your chair. It could be an advertisement, a song, a movie or something in a book. This video clip was that moment for me. Maybe it's because I'm a real estate "geek", but I doubt it.

I'm sure I'll take heat from someone for having Hitler mentioned in my blog, but it may be completely worth it for the joy of sharing this stuff with the majority.

If you are living, breathing US citizen, and especially if you are a homeowner (or formerly a homeowner....) you will have to smirk when you watch this. It even takes jabs at the National Assocication of Realtors as well as Realtors in General. That is what makes it even more hilarious to me.

This is the most incredible sattire of the current housing market experience ever created!

Enjoy as Hitler laments his personal downfall after:

  • taking out a "liar loan" to purchase his home
  • buying a flat-screen TV & luxury car with this home equity line
  • and now faces the reality of losing his "Vintage Camaro SS."
  • And his former Realtor now considers taking a job as a dog groomer.....

WOW.

NAR "Gets Real" about Bogus FSBO Claims

by Jeremy Larkin

In a continuing saga started by a DOJ antitrust lawsuit against the National Association of Realtors (NAR), the folks at ForSaleByOwner.com may have really blundered this time, (sorry private Sellers).

 

These guys have never made it any secret that they aren’t very happy about being “locked out” of the NAR-controlled Realtor.com listing database. Now they’ve come out and claimed that with a new “Silver” listing package a private seller can achieve placement in the Realtor.com website.

 

With over 8 million visitors per year, it’s no surprise that the ForSaleByOwner people (and their clients) want in….who wouldn’t?

 

But membership has is privileges and I’m sure your Mother told you that you get what you pay for, didn’t she?

 

Well evidently these guys don’t have permission to do what they are saying they can do (put FSBO listings into Realtor.com) and the Realtor.com people are making it very clear that is the case. In a press release issued today they made the following key clarifications (amongst many others:

 

• The settlement agreement between NAR and the Department of Justice made no provision to allow unlisted properties, such as “for-sale-by-owner,” to be posted on REALTOR.com.
• ForSaleByOwner.com does not in any way enable home sellers to advertise their home on REALTOR.com without broker representation. Every property on REALTOR.com must be listed by a licensed real estate broker.
• There are no unrepresented homes on REALTOR.com – every property on REALTOR.com must be listed by a licensed real estate broker.

 

The problem really stems from the ever-increasing availability of once private and MLS-controlled information to consumers. The typical Buyer and Seller of the internet age want instant access to real estate listings, statistics, buying/selling tips and more and if they can’t get in from one spot, they will surf on over to another at the snap of a finger.

 

This wild proliferation of quick & free info is creating what I call “information poisoning” and is quickly creating an entire population of attention-deficit consumers.

 

Segue back to the original subject of the FSBO’s wanting MLS access. So much information has been given away for FREE that most consumers no longer have a firm grip on what information has real “value” and what, well, DOESN’T.  

 

Opinions aside, many sellers, both listed and FSBO alike, labor under the delusion that if they “just get in enough websites” like Realtor.com or Craig’s list, then the house will sell. This belief is flawed on many levels, the main being the following reality of the business:

 

The great majority of real estate transactions are handled by LICENSED AGENTS on a LOCAL LEVEL.

 

Why? Because while the average buyer from, say, Los Angeles, CA uses the internet to research our area and pick out homes they may buy, they know darn well that when they physically come to town they can hire a professional realtor who:

·        Knows the area & is unbiased about which home they choose

·        Is familiar with the glut of inventory on the market

·        Understands local market & lending conditions

·        Provides lawsuit & legal protection through “E&O Insurance"

·        And costs them absolutely nothing because most serious, motivated Sellers pay the buyer-agent’s commission

 

Or they could go “deal hunting” at the ultimate expense of the FSBO who:

  • Is inherently biased about the home the buyer chooses (of course)
  • Is fairly un-familiar about the inventory (because they don’t study it to feed their family)
  • Is fairly un-familiar about local market and lending conditions (for the same reason listed above)
  • Has NO protection against lawsuits & very little familiarity with a binding contract
  • And who has, ultimately, no incentive to assist a buyer in making their best purchase because it would of course hurt their position as a Seller.

Private Sellers have their rights and if they can truly save the commission amount by not using a Realtor, more power to them. However, based on what I know about the situation I wouldn’t plan on seeing my home listed in Realtor.com any time soon if I were a FSBO.

 

Big Lenders Deciding to assist "At-Risk" Borrowers

by Jeremy Larkin

I know what you're thinking....."Hey I'm an at-risk borrower!" Aren't we all?

That said, with defaults mounting, big-time lenders including Citigroup, JPMorgan and Bank of America, have also become more aggressive about modifications to mortgage agreements.

What took them so long? Most likely optimism....the hope and assumption (based on historical data) that it would all just "get better."

From the article on Yahoo: Citigroup says it is imposing a moratorium on most foreclosures as part of a series of initiatives aimed at helping at-risk borrowers remain in their homes — making Citi the latest big bank to announce sweeping efforts to try to curtail losses from souring mortgages.

Citi said late Monday it won't initiate a foreclosure or complete a foreclosure sale on any eligible borrower who seeks to stay in a home if it is the borrower's principal residence, the homeowner is working in good faith with Citi and has sufficient income to make affordable mortgage payments.

So let's have some fun and I will translate for you some of the comments made by Citi Executives and PR people:

Sanjiv Das, chief executive of CitiMortgage, said, "It is in our interest that borrowers stay in their homes and actually make the payments."

Translation: "If we take on another foreclosure while hiring new people to process it we are going to go broke"

Das also said: "There is a huge amount of anxiety among borrowers," he said. "We will reach out to them before they become delinquent."

Translation: I'd like to THUMP these people for screwing up my vacation, yacht and 7th  home plans...can't they just pay their "&$@#* mortgages?

Steve Curnette, President of InsBank Mortgage in Nashville, TN said: "It's nearly an insurmountable undertaking. The number of bad loans that they can modify using their resources is being quickly outstripped by the number of new loans that need to be modified."

Translation: I wonder if Costco is hiring?........"

All joking aside, I am VERY pleased to see this happening. Homeowners need it, the banks need it, the ENTIRE COUNTRY needs it. It is all fun and games to see the foreclosed homes hit the market and figure out a plan to buy them for investment purposes, but at some point it will bankrupt the very institutions we rely on for credit.

 Additionally, (and I may get in trouble with homeowners), we all like to beat up on the big banks but when you truly understand the situation you see that THEY are the biggest losers. The average home-owner ruins their credit, feels stupid around their neighbors, then moves on to an equal or better home for LESS money as a rental.

I'd like to get some opinions from you people out there in OR out of my industry as to whether you like the idea of loan "workouts" or not. 

In the meantime PLEASE contact us if you or someone else you know is in a "bad spot" with their house. We work full-time with these issues and may be able to propose or find a solution to the problem. 

Carry on!

 

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Photo of Jeremy Larkin - The Larkin Group Real Estate
Jeremy Larkin - The Larkin Group
Keller Williams Realty
50 E 100 S, Suite 300
St. George UT 84770
435.767.9886
Fax: 435-359-5085

St. George Real Estate - Your premier destination for St. George,Utah Real Estate Listings, Home Values, MLS Search, REO/Foreclosure Info &  St. George Real Estate Statistics.  Serving St. George, Santa Clara, Ivins, Washington, Hurricane, LaVerkin, Toquerville & more! Specializing in REO/foreclosure properties, frustrated Sellers, First-Time home buyers, and Investors. Looking for the most LOCAL St. George, Utah real estate information available? Your search is over!