Short Sales truths, REO's and foreclosures in todays market

Money Magazines Outlook for 2009 Housing Depreciation….

noreply@blogger.com (xpertadvice4U) — Tue, 20 May 2008 18:34:00 +0000

2009 Money Magazine Housing Devaluation Predictions.

Money Magazine recently put out a city-by-city home price forecast as well. Using data from Fiserv Lending Solutions, First American CoreLogic, city and county assessors, and realtors, the magazine determined that U.S. home prices will fall an average of 9.7 percent.

Miami is expected to see the most lost equity. Money Magazine is predicting a 24.9 percent drop. Cities in Texas and New York are expected to fare the best.

Metro Area Median Home Price Forecast May 09 (% chg)
Albuquerque, NM $174,000 -10.5%
Atlanta, GA $205,000 -2.3%
Baltimore, MD $264,000 -12.5%
Boston, MA $363,000 -10.5%
Chicago, IL $279,000 -6.8%
Cleveland, OH $145,000 -4.3%
Denver, CO $254,000 -10.8%
Detroit, MI $120,000 8.6%
Edison, NJ $358,000 -15.8%
Fort Lauderdale, FL $309,000 -22.2%
Honolulu, HI $625,000 -16.2%
Houston, TX $150,000 1.2%
Jacksonville, FL $197,000 -9.6%
Kansas City, KS $148,000 -0.6%
Las Vegas, NV $277,000 -18.3%
Los Angeles, CA $528,000 -16.8%
McAllen, Texas $109,000 4.0%
Miami, FL $329,000 -24.9%
New Orleans, LA $158,000 2.2%
New York City, NY $471,000 -13.2%
Philadelphia, PA $200,000 -11.1%
Phoenix, AZ $237,000 -18.3%
Portland, OR $306,000 -14.7%
Riverside, CA $340,000 -16.9%
Rochester, NY $121,000 2.7%
Sacramento, CA $330,000 -8.9%
Salt Lake City, UT $229,000 -9.8%
San Diego, CA $522,000 -9.7%
San Francisco, CA $840,000 -10.1%
San Jose, CA $750,000 -12.5%
Seattle, WA $430,000 -9.0%
Springfield, MA $195,000 -9.5%
Stamford, CT $562,000 -13.9%

May 13th

Predicted That Millions Of Homeowners Are Considering…Just Walking Away.

noreply@blogger.com (xpertadvice4U) — Tue, 20 May 2008 18:33:00 +0000

Can Mortgage Borrowers Be Punished for Walking Away?
In a recent interview with the San Francisco Chronicle, Freddie Mac consumer outreach manager Robin Stout Migala claimed that there are many reasons why homeowners shouldn’t walk away from homes, including federal income tax liability and the chance that lenders may pursue walkaway borrowers.

Although Robin’s statements may be true in certain circumstances, it is equally likely that borrowers may not face the above-mentioned consequences.

As Mike ‘Mish’ Shedlock pointed out in a blog post Monday, some states (like California) are non-recourse states, which basically means that borrowers owe lenders nothing more than the house should they default. There are also non-recourse loans in recourse states with the same provision. As for tax liabilities, there are provisions in the Mortgage Forgiveness Debt Relief Act that allow tax free debt forgiveness.

The bottom line is that there will be consequences for those who do walk away–like a drop in credit scores–but the end result may not be as bad for borrowers as Migala implies.

May 13th, 2008

A Record Month for California Foreclosure Activity

noreply@blogger.com (xpertadvice4U) — Wed, 14 May 2008 01:11:00 +0000

CALIFORNIA FORECLOSURE SALES EXCEED 1,000 PER DAY

A Record Month for California Foreclosure Activity

Discovery Bay, CA, May 13, 2008 – ForeclosureRadar (www.foreclosureradar.com), the only website that tracks every California foreclosure with daily auction updates; today issued it’s California Foreclosure Report.

April foreclosure numbers were up in all categories, creating extraordinary indicators. Average daily auction sales exceeded 1,000 properties a day for the first time in California’s history.

High-level findings include:

Notices of Default –the filings for the first step in California’s foreclosure process increased only
slightly to set a new record of 44,101 new filings.

Notices of Trustee Sale, which are issued approximately 3 months following a Notice of Default,
increased 7.8 percent in April surpassing the previous record with a total of 29,892 new filings.

April foreclosure sales at auction jumped 44 percent over March to a record 22,838 sales, with a combined loan value of $9.45 Billion. The majority of these sales received no third party bid and reverted back to the lender despite the largest across the board discounts ever offered at trustee sale
auctions.

“We expected a significant increase in auction sales based on previous default patterns” said Sean O'Toole,founder of ForeclosureRadar. “Unfortunately, the continued increases in defaults tell us that the worst is still ahead. It is time for lenders to accept this reality, and start approving short sales rather than forcing more than two-thirds of troubled homeowners through the entire foreclosure process.”

Lenders added 22,324 properties to their real estate owned or “REO” inventory in April. Last month DataQuick reported that 38.4% of all home sales in California were from this REO inventory, equaling approximately 9,432 properties. Based on those levels, lenders are increasing REO inventories 1.36 times faster than they are
able to resell them.

In April, it took lenders an average of 140 days from Notice of Default to the property being sold at auction.

Average discounts at auction were 25%, but nearly half of all properties taken to auction offered discounts of 30% or more from the current loan balance. The majority of these loans were 80% LTV first mortgages, making discounts of 40 to 50% from the prior sales price common in many parts of the state.

The largest discounts offered in major Southern California counties were in Santa Barbara (29 percent) and Riverside (28 percent). The smallest were Los Angeles (19 percent) and Orange (21 percent). The spread was wider in Northern California, with Merced offering the states larges discounts (37 percent), and San Francisco the smallest (12 percent).

In a sign that foreclosures are affecting every part of the state, foreclosure sales nearly doubled in both Marin
County (96 percent increase), and Orange County (up 82 percent).

Home Sales Data Just Released…Must Read.

noreply@blogger.com (xpertadvice4U) — Thu, 24 Apr 2008 15:53:00 +0000

Special report for HREU Students. This is the latest information about home sales. Use this information to better educate yourself and your buyers and sellers.

Remember, there has never been a time in the history of our country when caring, competent and skilled agents have been so needed. This is not a sellers market, despite what you have been told this is NOT a buyers market….this is an Agents market. This is your market. Learn the skills necessary and you will thrive beyond your wildest dreams. Start with learning and the earning always follows.

Click Here To Download a Free Copy Of Our Newest Book..How To Survive The Worst Real Estate Market In History

The two-year U.S. housing slump showed no sign of abating in March as sales of previously owned homes fell for the seventh time in eight months.

Purchases dropped 2 percent, less than forecast, to an annual rate of 4.93 million, from 5.03 million in February, the National Association of Realtors said today in Washington. The median sales price declined 7.7 percent from a year earlier.

The jump in subprime defaults and credit-market losses has caused banks to demand higher down payments and increased income documentation for home loans. Many legislators are now suggesting new laws that require buyers to put down at least 20% on home purchases.

A separate measure of home values published by the government’s Office of Federal Housing Enterprise Oversight showed that sales prices dropped 2.4 percent in February from a year earlier. The monthly house price index is down 3.1 percent from its peak in April 2007.

“The housing downturn continues in full swing,” Mark Zandi, chief economist at Moody’s Economy.com in West Chester, Pennsylvania. “Potential home buyers are sitting on the sidelines. They do sense that prices are going to go down further. We’re still a good six, 12 months away before we see buyers come in.”

Bank of America Corp., the nation’s second-biggest bank, said today it plans to curtail low-documentation loans and restrict credit to some borrowers after taking over Countrywide Financial Corp. Yesterday, the bank said profit fell for a third straight quarter as it set aside $6.01 billion for bad loans.

The number of homes for sale at the end of March increased by 40,000 to 4.06 million. At the current sales pace, that represented 9.9 months’ worth, up from 9.6 months’ worth at the end of the prior month.

Watch A Free Video Now. How To Make Money Now In This Market.

Median Price

The median price of an existing home dropped to $200,700 from $217,400 a year earlier.

Many economists consider new-home purchases, which are recorded when a contract is signed, a more timely barometer of the market.

Figures from the Commerce Department later this week may show sales of new houses fell in March to an annual pace of 580,000, a 13-year low.

Resales of single-family homes fell 2.7 percent to an annual rate of 4.35 million. Sales of condos and co-ops increased 3.6 percent to a 580,000 rate.

Housing Starts

Falling sales are prompting builders to pare back construction and reduce prices. Work began on 947,000 homes at an annual rate in March, less than forecast and the fewest in 17 years, Commerce figures showed last week.

Median price of SoCal homes plunged 24 pct to 4-year low

noreply@blogger.com (xpertadvice4U) — Tue, 22 Apr 2008 22:00:00 +0000

By MICHAEL LIEDTKE
SAN FRANCISCO - Southern California home values plummeted 24 percent during March, leaving prices at an almost four-year low amid the real estate market's deepening distress.

The median price of homes sold in a six-county region stood at $385,000 in March, a sobering turnaround from the previous year when values had reached a record $505,000, according to data released Tuesday by DataQuick Information Services.

Southern California homes haven't sold for so little since April 2004 when the region's median price stood at $380,000.

The median price represents the point where half the homes sell for more and half sell for less.

Tuesday's report covered Los Angeles, Orange, Riverside, San Bernardino, San Diego and Ventura counties - a region that once ranked among the nation's hottest real estate markets as lenders aggressively lowered their rates and standards for qualifying for home loans.

As it turned out, many borrowers couldn't afford their mortgages after they adjusted upward from temporarily low rates. That has led to a wave of foreclosures that is prompting lenders to sell Southern California homes at sharp discounts and depressing the value of neighboring properties.

More than a third of the Southern California homes sold last month had been through a foreclosures at some point during the past year, according to DataQuick.

Riverside and San Bernardino counties - a rapidly growing region known as the Inland Empire - was particularly hard hit.

Foreclosures accounted for 56 percent of the sales in Riverside County, where the median price of a home fell 27 percent to $306,250. The erosion was even worse in San Bernardino County, where the median home price plunged 28 percent to $265,000.

Orange County remained Southern California's most expensive housing market with a median sales price of $506,000, but that was still 20 percent below last year's level.

The depressed market is prompting many prospective home sellers to stay on the sidelines until they see signs of an upturn, said Marshall Prentice, DataQuick's president.

"Often what we're left with, especially in inland areas, are sales driven by foreclosure or the threat of it," he said.

Real Estate Meets Recession.

noreply@blogger.com (xpertadvice4U) — Wed, 16 Apr 2008 15:18:00 +0000

There is no doubt that our real estate markets are in a full blown recession. In most real estate markets property is depreciating at 2% + per month. For example, in California property has depreciated 24% from March 07 to 08.

Be clear, we are not anywhere near the ‘bottom’. Markets will get much more challenging for sellers. More foreclosures, more short sales, more depreciation.

The fact is San Bernardino County is facing the worst home value drop in the US with a decline of almost 46% from its peak in 2005-2006 according to John Burns Real Estate Consulting. Chances are if you purchased or refinanced during the “Golden Years” you’re in a negative equity position or will be soon. What spurred this colossal loss of equity? Simply said…too many loans approved to unqualified buyers created a surge of demand driving prices up to unrealistic values resulting in “false” inflation and “false” demand for inventory.

Recently in Chino....

noreply@blogger.com (xpertadvice4U) — Fri, 04 Apr 2008 23:57:00 +0000

We just met some great people the other day while helping them locate a new home to lease because they are facing a foreclosure date later this month. It's unfortunate that they had their home listed with an agent that did not have the experience to get the property sold. We're working with their lender to get an offer to them and buy a little time for the family while we get them a new home. Also, if anyone out there needs to find a place to lease let us know.

Soldiers' and Sailors' Civil Relief Act of 1940

noreply@blogger.com (xpertadvice4U) — Fri, 04 Apr 2008 23:19:00 +0000

For our heroes

http://www.defenselink.mil/specials/Relief_Act_Revision/

Lenders Swamped By Foreclosures Let Homeowners Stay

noreply@blogger.com (xpertadvice4U) — Fri, 04 Apr 2008 23:14:00 +0000

April 4 (Bloomberg) -- Banks are so overwhelmed by the U.S. housing crisis they've started to look the other way when homeowners stop paying their mortgages.

The number of borrowers at least 90 days late on their home loans rose to 3.6 percent at the end of December, the highest in at least five years, according to the Mortgage Bankers Association in Washington. That figure, for the first time, is almost double the 2 percent who have been foreclosed on.

Lenders who allow owners to stay in their homes are distorting the record foreclosure rate and delaying the worst of the housing decline, said Mark Zandi, chief economist at Moody's Economy.com, a unit of New York-based Moody's Corp. These borrowers will eventually push the number of delinquencies even higher and send more homes onto an already glutted market.

``We don't have a sense of the magnitude of what's really going on because the whole process is being delayed,'' Zandi said in an interview. ``Looking at the data, we see the problems, but they are probably measurably greater than we think.''

Lenders took an average of 61 days to foreclose on a property last year, up from 37 days in the year earlier, according to RealtyTrac Inc., a foreclosure database in Irvine, California. Sales of foreclosed homes rose 4.4 percent last year at the same time the supply of such homes more than doubled, according to LoanPerformance First American CoreLogic Inc., a real estate data company based in San Francisco.

Reluctant Banks

``Some people stay in their houses until someone comes to kick them out,'' said Angel Gutierrez, owner of Dallas-based Metro Lending, which buys distressed mortgage debt. ``Sometimes no one comes to kick them out.''

Banks are reluctant to foreclose on homeowners for a variety of reasons that include the cost, said Peter Zalewski, real estate broker and owner of Condo Vultures Realty LLC, a property consulting firm in Bal Harbour, Florida.

Legal fees and maintaining a vacant property while paying the mortgage, insurance and taxes can add up to as much as 15 percent of the value of the home, and it may take months for the foreclosure to work through the legal system, he said.

``The end result is taking back a property that the bank will have to manage, rent out and or sell,'' Zalewski said.

In many cases, lenders also have to foot the bill for fixing up vacant homes that have been vandalized.

Empty Houses

Real estate broker Georgia Kapsalis is offering a home for sale in Birmingham, Michigan, a Detroit suburb, where the owner last wrote a mortgage check in July. He still lives in the house, she said.

``Some of the banks just don't want the houses to be empty, especially if it's in an area where there's a lot of theft or there are five other houses empty on the street,'' said Kapsalis, who works at Added Value Realty LLC in Livonia, Michigan, another Detroit suburb. ``They'll lose toilets, plumbing, appliances, everything. Banks are getting wise and allowing people to live there longer.''

Alexis McGee, president of Internet database Foreclosures.com in Sacramento, California, said she toured a property where the departing resident tried to make off with the outdoor air conditioning unit by sawing the metal legs off its concrete apron.

``People take what they want to take,'' McGee said. ``They feel that they're owed.''

Flooded Market

With home sales dropping and national inventories rising, the lenders have another reason to delay foreclosures, said Howard Fishman, a real estate investor based in Minneapolis.

``What are the banks going to do?'' Fishman said. ``They don't want the house. They have a mortgage for $1 million and the house is worth $750,000.''

In February, 5 million existing homes were sold on a seasonally adjusted, annualized rate, down 31 percent from the peak of 7.25 million in September 2005, data compiled by the Chicago-based National Association of Realtors show. More than 4 million existing homes were on the market in February, 53 percent more than the 2.6 million average of the past nine years, the Realtors reported.

``Excess inventories pose the biggest risk to the market,'' Michelle Meyer and Ethan Harris, New York-based economists at Lehman Brothers Holdings Inc., wrote in a report last month. ``As long as inventories are high, home prices will fall.''

New Foreclosures

Growing inventory pulled median home prices down to $195,900 in February, a 15 percent drop from the peak of $230,200 in July 2006, the Realtors said.

New foreclosures rose to 0.83 percent of all home loans in the fourth quarter from 0.54 percent a year earlier, according to the Mortgage Bankers Association.

The civil court in St. Lucie County, Florida, is getting about 44 foreclosure cases to file every day. That's the same number it averaged in a typical month in 2005, said Clerk of the Circuit Court Ed Fry.

``It's pretty overwhelming,'' he said.

Fry said he has 12 full-time employees and two temporary workers he just hired handling nothing but foreclosures. Still, the 50-page filings sit in cardboard boxes for three weeks before the court staff can process them, Fry said. Then it takes another two months to get a date on the court docket, he said.

Mortgage servicers, who collect monthly payments and are responsible for starting the foreclosure process, also were caught short-staffed, said Grant Stern, a mortgage broker and owner of Morningside Mortgage Corp. in Miami Beach, Florida.

`Moral Hazard'

``The most experienced people you can bring in are origination people,'' Stern said. ``But for a bank it's a moral hazard to have the same people who originated the loans now modifying those loans. That wouldn't be desirable. Once around is enough.''

The five largest servicers -- Countrywide Financial Corp., Wells Fargo & Co., CitiMortgage Inc., Chase Home Finance Inc. and Washington Mutual Inc. -- together manage more than half the home loans in the U.S., according to New York-based National Mortgage News, an industry publication.

While more than 100 mortgage originators have suspended operations, closed or sold themselves since the beginning of 2007, mortgage servicing units are expanding.

Chase Home Finance, a unit of New York-based JPMorgan Chase & Co. and the fourth-largest U.S. servicer, expects to spend $200 million more servicing loans in 2008 than it did last year, said spokesman Thomas Kelly.

Delayed Foreclosure

Kelly wouldn't say how many Chase borrowers have quit paying their mortgages and remain in their homes.

Efforts to keep borrowers paying their bills have slowed the foreclosure process, Mark Rodgers, a spokesman at CitiMortgage, a division of New York-based Citigroup Inc., said in an e-mail message.

``In a number of cases, we have delayed foreclosure proceedings to allow our loss mitigation teams additional time to explore potential solutions to keep distressed borrowers in their homes,'' Rodgers said.

Joe Ohayon, vice president of community relations for Wells Fargo Home Mortgage in Frederick, Maryland, a unit of San Francisco-based Wells Fargo, said trying to modify loan terms case by case adds time to the foreclosure process.

``Foreclosure is only a last resort after all available options for keeping the customer in the home have been exhausted,'' Ohayon said in an e-mail message.

Affordable Payments

Olivia Riley, a spokeswoman at Seattle-based Washington Mutual, said in an e-mail that the company's goal is to keep customers in their homes ``with payments they can afford.''

Representatives for Calabasas, California-based Countrywide, the biggest U.S. mortgage servicer last year, didn't respond to requests for comment.

Few mortgage companies will admit they allow homeowners to stay in their homes without paying their bills.

``No servicer will say you can live rent-free for six months, go ahead,'' said Paul Miller, a mortgage industry analyst at Friedman Billings Ramsey & Co. in Arlington, Virginia. ``Eventually, the servicers will clear these guys out.''

Homeowners usually get 90 days to resume paying before foreclosure proceedings begin with the filing of a complaint or notice of non-payment.

State laws determine the length of time between the filing and an auction of the house. In most states, it's two to six months, according to Foreclosures.com. In Maine, it can be up to a year and in New York, 19 months; in Georgia, it's as quickly as one month, and in Nevada, it can be 35 days, according to the database.

Borrowers in California who fight foreclosure can stretch the process to 18 months, said Cameron Pannabecker, chapter president of the California Association of Mortgage Brokers and president of Cal-Pro Mortgage Inc. in Stockton.

That doesn't take into account the woman he knows who hasn't made a mortgage payment in eight months and hasn't heard from her lender, Pannabecker said.

``Now she's afraid to mail in a payment for fear it'll come to somebody's attention,'' he said.

To contact the reporter on this story: Bob Ivry in New York at bivry@bloomberg.net.

California Senate approves bill on mortgage debt...onto the Assembly

noreply@blogger.com (xpertadvice4U) — Fri, 04 Apr 2008 17:45:00 +0000

California Senate approves bill on mortgage debt

From the Associated Press
March 25, 2008

SACRAMENTO -- The state Senate approved a bill Monday to help California homeowners whose lenders have forgiven part of their mortgage debt.

The bill would end a requirement that homeowners report that part of the loan that was forgiven as income on their tax returns.

Sen. Michael Machado (D-Linden) said the bill would help in a short sale, loan modification or refinance in which part or all of the debt is forgiven.

The bill would apply only to owner-occupied homes in which the debt was forgiven this year or last. The bill now heads to the Assembly.

Foregiveness from the IRS??? It's True!

noreply@blogger.com (xpertadvice4U) — Sat, 29 Mar 2008 18:24:00 +0000

Excerpt from: www. IRS.Gov: http://www.irs.gov/irs/article/0,,id=179073,00.html
Mortgage Workouts, Now Tax-Free for Many Homeowners; Claim Relief on Newly-Revised IRS Form

Updated with FAQs at bottom — Feb. 28, 2008
IR-2008-17, Feb. 12, 2008
WASHINGTON — Homeowners whose mortgage debt was partly or entirely forgiven during 2007 may be able to claim special tax relief by filling out newly-revised Form 982 and attaching it to their 2007 federal income tax return, according to the Internal Revenue Service.
Normally, debt forgiveness results in taxable income. But under the Mortgage Forgiveness Debt Relief Act of 2007, enacted Dec. 20, taxpayers may exclude debt forgiven on their principal residence if the balance of their loan was less than $2 million. The limit is $1 million for a married person filing a separate return. Details are on Form 982 and its instructions, available now on this Web site.
“The new law contains important provisions for struggling homeowners,” said Acting IRS Commissioner Linda Stiff. “We urge people with mortgage problems to take full advantage of the valuable tax relief available.”
The late-December enactment means that reporting procedures for this law change were not incorporated into tax-preparation software or IRS forms. For that reason, people using tax software should check with their provider for updates that include the revised Form 982. Similarly, the IRS is now updating its systems and expects to begin accepting electronically-filed returns that include Form 982 by March 3. The paper Form 982 is now being accepted, but the IRS reminds affected taxpayers to consider filing electronically, which greatly reduces errors and speeds refunds.
The new law applies to debt forgiven in 2007, 2008 or 2009. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, may qualify for this relief. In most cases, eligible homeowners only need to fill out a few lines on Form 982 (specifically, lines 1e, 2 and 10b).
The debt must have been used to buy, build or substantially improve the taxpayer's principal residence and must have been secured by that residence. Debt used to refinance qualifying debt is also eligible for the exclusion, but only up to the amount of the old mortgage principal, just before the refinancing.
Debt forgiven on second homes, rental property, business property, credit cards or car loans does not qualify for the new tax-relief provision. In some cases, however, other kinds of tax relief, based on insolvency, for example, may be available. See Form 982 for details.
Borrowers whose debt is reduced or eliminated receive a year-end statement (Form 1099-C) from their lender. For debt cancelled in 2007, the lender was required to provide this form to the borrower by Jan. 31, 2008. By law, this form must show the amount of debt forgiven and the fair market value of any property given up through foreclosure.
The IRS urges borrowers to check the Form 1099-C carefully. Notify the lender immediately if any of the information shown is incorrect. Borrowers should pay particular attention to the amount of debt forgiven (Box 2) and the value listed for their home ( Box 7).
Related Items:
• Frequently asked questions on the Mortgage Forgiveness Debt Relief Act
• Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness
• 1099-C

Fact Sheet: The Mortgage Forgiveness Debt Relief Act of 2007

noreply@blogger.com (xpertadvice4U) — Fri, 28 Mar 2008 21:07:00 +0000

President Bush Signs Legislation Protecting American Families From Higher Taxes When They Refinance Their Homes

"When your home is losing value and your family is under financial stress, the last thing you need is to be hit with higher taxes. So I'm working with members of both parties to pass a bill that will protect homeowners from having to pay taxes on cancelled mortgage debt."

─ President George W. Bush, 9/1/07

Today, President Bush signed the Mortgage Forgiveness Debt Relief Act of 2007, which will help Americans avoid foreclosure by protecting families from higher taxes when they refinance their home mortgages. This Act will create a three-year window for homeowners to refinance their mortgage and pay no taxes on any debt forgiveness that they receive. Under current law, if the value of your house declines, and your bank or lender forgives a portion of your mortgage, the tax code treats the amount forgiven as income that can be taxed.

This Act will increase the incentive for borrowers and lenders to work together to refinance loans and allow American families to secure lower mortgage payments without facing higher taxes.

noreply@blogger.com (xpertadvice4U) — Fri, 28 Mar 2008 00:02:00 +0000

noreply@blogger.com (xpertadvice4U) — Thu, 27 Mar 2008 23:34:00 +0000

Technorati Profile

Existing Home Sales Increase!

noreply@blogger.com (xpertadvice4U) — Thu, 27 Mar 2008 00:43:00 +0000

Sales of U.S. existing homes rose in February for the first time since July as prices posted a record drop from their year-ago level, but economists said it was unlikely the market had reached a bottom.
The National Association of Realtors on Monday said sales of previously owned homes rose 2.9 percent in February to a 5.03 million-unit annual rate, bucking expectations on Wall Street for a decrease.
While the rise broke a six-month streak of declining sales, prices continued to slip. The trade group said median prices fell 8.2 percent from their year-ago level to $195,900. It was the biggest year-on-year drop on record dating to 1968.
Be careful that you don’t see think that we have reached the bottom in housing. As many of you already know the real issue is the millions of American homeowners who have no home equity or are upside down in their homes.
The pick-up in existing home sales helped cut into the bloated inventory of unsold homes on the market. NAR said the inventory fell 3 percent to 4.03 million units at the end of February. At February’s sales pace that represented a 9.6 months’ supply, the slimmest inventory since August but still high by historical standards.
Remember, this doesn’t count the unsold new construction inventory. Realistically, most markets across the country have over a years worth of supply.
“That’s not much of an improvement in inventory,” said Gregory Miller, chief economist at SunTrust Banks in Atlanta. “As long as bank lending standards stay as tight as they have been, it will be a long correction process.”
NAR also reported that sales decreased by 1.1 percent in the West, but were up 11.3 percent in the Northeast, 2.5 percent in the Midwest and 2.1 percent in the South. Nationally, existing home sales have tumbled 23.8 percent over the past year.

Case-Shiller Home Price Report released today….

noreply@blogger.com (xpertadvice4U) — Thu, 27 Mar 2008 00:41:00 +0000

***Case-Shiller Home Price 10-City Index January: 196.05, down 2.3% from December and down 11.4% from January 2007;
***Case-Shiller Home Price 20-City Index January: 180.65, down 2.4 from December and down 10.7% from January 2007.

What it means: The decline in the Case/Shiller Index reaffirms the struggles in the housing sector, which were suggested in Monday’s report on existing home sales. Although unit sales were up in Monday’s report from the National Association of Realtors [NAR], the median sales price of an existing single family home fell, registering an 8.2% year-year decline.

White House Press Release; Mortgage Forgiveness Debt Relief Act

noreply@blogger.com (xpertadvice4U) — Thu, 27 Mar 2008 00:32:00 +0000

For Immediate ReleaseOffice of the Press SecretaryDecember 20, 2007
Fact Sheet: The Mortgage Forgiveness Debt Relief Act of 2007 President Bush Signs Legislation Protecting American Families From Higher Taxes When They Refinance Their Homes
White House News
In Focus: Homeownership President Bush Signs H.R. 3648, the Mortgage Forgiveness Debt Relief Act of 2007
"When your home is losing value and your family is under financial stress, the last thing you need is to be hit with higher taxes. So I'm working with members of both parties to pass a bill that will protect homeowners from having to pay taxes on cancelled mortgage debt."
─ President George W. Bush, 9/1/07
Today, President Bush signed the Mortgage Forgiveness Debt Relief Act of 2007, which will help Americans avoid foreclosure by protecting families from higher taxes when they refinance their home mortgages. This Act will create a three-year window for homeowners to refinance their mortgage and pay no taxes on any debt forgiveness that they receive. Under current law, if the value of your house declines, and your bank or lender forgives a portion of your mortgage, the tax code treats the amount forgiven as income that can be taxed.
This Act will increase the incentive for borrowers and lenders to work together to refinance loans and allow American families to secure lower mortgage payments without facing higher taxes.
This Act Is A Good Step To Address The Housing Market, But Congress Has More Work To Do
Congress needs to complete work on responsible legislation modernizing the Federal Housing Administration (FHA). This bill will give FHA the necessary flexibility to help hundreds of thousands of additional families qualify for prime-rate financing.
Congress needs to pass legislation permitting State and local governments to help troubled borrowers by issuing tax-exempt bonds for refinancing existing home loans. Under current law, cities and States can issue tax-exempt bonds to finance new mortgages for first-time homebuyers.
Congress needs to pass legislation to reform Government Sponsored Enterprises (GSEs) like Freddie Mac and Fannie Mae. GSEs provide liquidity to the mortgage market that benefits millions of homeowners, and it is vital that they operate safely and soundly. The President has called on Congress to pass legislation that strengthens independent regulation of the GSEs and ensures they focus on their important housing mission.
The Administration Has Moved Forward On Targeted Actions To Assist Homeowners That The President Announced In August
The President and his Administration have launched a new initiative at the Federal Housing Administration (FHA) called FHASecure. FHASecure expands the FHA's ability to offer refinancing by giving it the flexibility to work with homeowners who have good credit histories but cannot afford their current payments. By the end of 2008, the FHA expects this program to help more than 300,000 families refinance their homes.
Treasury Secretary Henry Paulson and Housing and Urban Development Secretary Alphonso Jackson have assembled the private-sector HOPE NOW alliance. HOPE NOW recently mailed hundreds of thousands of letters to borrowers falling behind on their payments and is supporting a toll-free mortgage counseling hotline, 1-888-995-HOPE.
HOPE NOW has developed a plan under which up to 1.2 million homeowners could be eligible for assistance. The HOPE NOW plan will help subprime borrowers who can afford the current, starter rate on a subprime loan, but would not be able to make the higher payments once the interest rate goes up.

How long does the foreclosure process take, is there still time for a short sale?

noreply@blogger.com (xpertadvice4U) — Wed, 26 Mar 2008 20:47:00 +0000

The foreclosure process takes differing times depending on your state. In the Midwest a foreclosure can take over a year. In California it’s taking 6+ months. Generally speaking a well priced short sale being processed by an educated short sale listing agent will sell and close in less than 120 days. There is almost ALWAYS time to save the property from foreclosure when you list it doing a short sale. Lenders do not want the property back, it's important to get it listed asap.

Will I have to pay property taxes if I do a short sale?

noreply@blogger.com (xpertadvice4U) — Wed, 26 Mar 2008 20:45:00 +0000

Property taxes will always have to be paid as part of any accepted short sale. Whether it’s you or the lender depends on their policies and the specific agreement you reach while negotiating the short sale.

What about paying income taxes...will I get a 1099?

noreply@blogger.com (xpertadvice4U) — Wed, 26 Mar 2008 20:43:00 +0000

It WAS true, now it’s now. Consult your Tax Attorney or Qualified CPA. Very recently the tax law was modified and now most people who do a short sale will have no taxes due.

Do I pay the real estate commisions when I do a short sale?

noreply@blogger.com (xpertadvice4U) — Wed, 26 Mar 2008 20:41:00 +0000

The bank will pay the commission along with all the other usual closing costs.

I want to do a short sale but I have a 2nd mortgage, can I still do this?

noreply@blogger.com (xpertadvice4U) — Wed, 26 Mar 2008 20:38:00 +0000

Yez,Both of your lenders will need to be satisfied in some way to complete the short sale. If your first lender will be paid off by the sale, then you just negotiate the terms with the second lender. Most short sales do involve 1st and 2nd lien holder

Do I have to qualify for a short sale

noreply@blogger.com (xpertadvice4U) — Wed, 26 Mar 2008 19:48:00 +0000

The simple answer is NO. If someone can’t make their payment and they are otherwise insolvent they qualify for a short sale. Note: insolvent simply means their total debts are great than their assets.

Do I have to be behind on my house payments to do a short sale?

noreply@blogger.com (xpertadvice4U) — Wed, 26 Mar 2008 19:41:00 +0000

No. Late last year most major lenders started accepting short sale offers from sellers who have never missed a payment.