Loan Mod Voice

Interesting….The Truth About Mortgage.com

Kathy Lowe — Thu, 03 Jun 2010 17:19:43 +0000

Free Rent for a Year If You Stop Paying Your Mortgage
20Apr10
Here’s an interesting tidbit from Diana Olick over at RealtyCheck.
Former Credit Suisse analyst Ivy Zelman, the one that came up with the infamous mortgage rate reset chart, said on average it takes 417 days for a lender to send a foreclosure notice after a borrower stops making mortgage payments.
Yep, 417 days. More than a year. Oh, and it can take another year after that for the bank to finally reclaim the property and boot out the homeowner.
In other words, those who stop making mortgage payments, either by necessity or strategically, can hang around for a long, long time.
You may even get a couple thousand if you play nice and return the keys to the lender and don’t steal anything.
Of course, this is just the average number of days it takes, and I’m not sure where she pulled the figure from. But it does highlight the incredible backlog banks and mortgage lenders are dealing with.
Zelman was making a point about the shadow inventory, which is the pending supply of homes not included in the official numbers.
It includes things like delinquent mortgages, short sales, foreclosures, and so forth.
So when you see those numbers released by the census bureau each month that show supply slipping, it’s not entirely accurate, not by a long shot.
That’s why we might see even more downward pressure on home prices throughout the year.

Foreclosed homeowners could owe ‘tens thousands of dollars’ to lenders

Kathy Lowe — Mon, 24 May 2010 18:50:18 +0000

California’s real estate association is warning people who lose — or are in danger of losing — their homes to foreclosure that they could face a hefty lawsuit from the lender, even after handing over the keys.
California law has protected borrowers from so-called “deficiency” liability, where in essence the house serves as collateral for the loan, for their original mortgages since the 1930s.
But if consumers refinanced their original mortgage — even for a lower interest rate or to finance home improvements — and fail to make payments leading to foreclosure, lenders can sue for the difference between the money owed and the value of the property, according to the California Association of Realtors. For example, if a homeowner has $200,000 outsanding for a refinanced mortgage and the lender forecloses on the house with the property valued at $150,000, the former homeowner could be liable for the remaining $50,000.
“Most homeowners have no idea they are personally liable,” CAR president Steve Goddard said in a news release Tuesday. “Foreclosure is difficult enough on a family. Getting sued for tens of thousands of dollars after losing your home is much worse.”
The state association has sponsored legislation — Senate Bill 1178 by state Sen. Ellen Corbett, a Democrat from Los Angeles — to close the loophole.
Corbett says many homeowners are not aware of the law, which allows banks to seek funds for refinanced loans. The bill only affects refinanced mortgages.
“Lenders have a responsibility to ensure that borrowers understand loan terms and can meet them,” Goddard said. The bill “puts in place much-needed consumer protections and deserves swift passage by the California Legislature next week.”
Read more: Foreclosed homeowners could owe ‘tens thousands of dollars’ to lenders – Los Angeles Business from bizjournals

Please see this video regarding this article: http://videos.car.org/mediavault.html?menuID=3&flvID=8

Short Sale Your Home-Buy In 2 Years-New Rules!

Kathy Lowe — Tue, 11 May 2010 08:49:05 +0000

Interesting update from our friend, Kevin Budde at Bank of America…

Fannie Mae Relaxing Rules

FNMA has recently announced the minimum waiting period to obtain a new mortgage after a short sale or deed in lieu foreclosure is being reduced. Effective, July 1, the wait will go from a minimum four to five years to two years. FNMA wants to encourage solutions for homeowners and to avoid foreclosure.

A minimum 20% down payment is required to qualify for the two year minimum payment. With 10% down the four year minimum will remain in place and less down will be longer. Foreclosures remain at a five year waiting period.

Extenuating circumstances, such as a job loss or a divorce, allows a two year minimum with 10% down. FNMA expects borrowers to reestablish their credit as well. Foreclosures and short sales generally have the same effect on a borrower’s credit score. Three active revolving or installment debt credit trade lines for a twelve month payment history will be required. Nontraditional credit will not be allowed.

FHA, with 3.5% down, is considering changes in their guidelines which currently requires a minimum of three years after a short sale or deed in lieu foreclosure.