House Keys

Ask a real estate pro: I have an underwater mortgage but love the house

Fri, 10 Feb 2012 06:00:00 -0500

Board-certified real estate attorney Gary M. Singer answers housing questions in this space each Friday. To ask him a question about short sales, mortgages, refinancing, homeowner's associations or any other residential real estate topic, click here.

Q: I have an underwater mortgage. My wife and kids really like the house and neighborhood, but all my friends wonder why I continue to pay on a loan that’s worth more than the house. Should I stop making payments and try for a short sale? – Ralph

A: I don’t know why you would do either. The simple truth is that your home’s current market value should have little bearing on what it's worth to you. Owning a home is so much more than a business transaction. Before you decide what to do with your property, you have to ask yourself what is driving your decision. Do you need to move now? Is the neighborhood unsafe? Is it in a bad school district? Does your next-door neighbor snore REALLY loud?

If you like where you live, can afford your payments and aren’t being forced to relocate, then it doesn’t really matter if your home is underwater. I have seen far too many people blow their credit, be subject to a foreclosure lawsuit and lose many nights of sleep before realizing that maybe they should keep their home after all. So my advice is that if you like where you live and can afford your payments, focus on the positive things in life, such as playing with your kids in your backyard or talking to your neighbors over the back-yard fence about the Giants’ big win. A lot of people got into this mortgage mess because they unsuspectingly followed their friends’ lead in buying a house they did not like or could not afford because they “didn’t want to miss out.” Don’t make another mistake now by giving up on a home you love.

Q: My tenant moved out of the apartment that I rented to him and left behind about $400 worth of random stuff. What do I do with it? – Nancy

A: Florida, like most states, has specific laws to deal with abandoned personal property left behind by a tenant. The Disposition of Personal Property Landlord and Tenant Act requires that you mail or give your former tenant a specific form, telling him or her where the property is and allowing 15 days to claim the property. If the property is worth more than $500, then it should be sold at an auction, with the proceeds defraying the cost. Anything unsold should be sent to the county clerk’s office, where it may be claimed by the former tenant for one year. If it is worth less than $500, it may be kept by the landlord, sold or destroyed if it is not claimed.

The information and materials on this blog are provided for general informational purposes only and are not intended to be legal advice. No attorney-client relationship is formed, nor should any such relationship be implied. Nothing on this blog is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction.

To follow Gary Singer on Twitter, click here.

Zillow: S. Fla. on pace for housing bottom in 2012

Thu, 09 Feb 2012 06:30:00 -0500

South Florida’s housing outlook is brightening amid growing talk of a bottom.

Real estate website Zillow.com says its year-end Home Value Index for Palm Beach, Broward and Miami-Dade counties was $137,500, up 0.4 percent from the third quarter. That's not a lot, but the index hasn't increased by that much on a quarterly basis since early 2006.

"It's been a long time coming," Zillow senior economist Svenja Maarit Gudell said of South Florida's housing recovery.

While the region's Home Value Index fell 3 percent from a year ago, Zillow projects values here to remain flat during 2012. That’s seen as a victory, given that values in places such as Atlanta, Chicago and Seattle are expected to fall by at least 7 percent this year.

Zillow says South Florida is on track for a housing bottom by late this year, though other firms predict Broward County won't hit bottom until next year.

The Sunshine State still has plenty of foreclosures to work through, but foreign investors will quickly scoop up those properties, particularly in South Florida, Gudell said.

Other news of note from Zillow:

• 44.1 percent of all South Florida home sales in December were for a loss, down slightly from 44.6 percent in November.

• Home values in the tri-county region have plunged 55.2 percent since peaking in 2006.

• While home values in some markets are likely to reach a bottom this year, Zillow isn’t forecasting a definitive national bottom in 2012.

To follow Paul Owers on Twitter, click here.

CoreLogic: Florida leads nation in foreclosure inventory

Wed, 08 Feb 2012 16:00:00 -0500

Florida has the nation’s highest foreclosure inventory, according to a report Wednesday from CoreLogic, a California research firm.

Roughly 12 percent of all homes with a mortgage in the Sunshine State were in some stage of foreclosure as of December, virtually unchanged from a year ago. New Jersey is second (6.4 percent) and Illinois third (5.4 percent). The national average is 3.4 percent.

About 17 percent of Florida homeowners are 90 days late on their mortgage payments. That also tops the nation.

Other highlights:

• Lenders completed 83,268 foreclosures in Florida during 2011, down from 155,486 the year before. Since January 2006, 483,374 foreclosures have made it through Florida courts.

• Nationally, 1.4 million homes, or 3.4 percent of properties with a mortgage, were in the foreclosure process as of December.

• Lenders completed about 830,000 foreclosures nationwide last year, down from 1.1 million in 2010.

Paying homeowners to complete short sales

Wed, 08 Feb 2012 09:23:29 -0500

Bloomberg is out with a piece on banks offering cash to homeowners to complete short sales.

We wrote a similar story last summer.

The lenders are trying to get bad loans off their books and hoping the money ensures cooperation from the homeowners.

Obviously, it’s a fantastic deal if you can get it, but the banks don’t say how they select homeowners for the incentive.

Have you gotten one? Tell us about it.

To follow Paul Owers on Twitter, click here.

House takes step to shrink Citizens insurer

Tue, 07 Feb 2012 07:30:00 -0500

The Florida House last week passed a measure that would allow less regulated “surplus lines” insurance carriers to take over policies from Citizens Property Insurance Corp.

The bill, which still must be approved by the Senate, is part of an effort to shrink Citizens, the state-backed insurer of last resort. It has 1.5 million policies, including 650,000 in Southeast Florida.

Sean Shaw, founder of Policyholders of Florida, an advocacy group, blasted the House for approving the legislation.

“This bill welcomes vultures into our insurance market, leaving Citizens with only the most risky policies and pushing unfortunate policyholders into unregulated markets,” Shaw said in a statement. “Now it’s up to the Florida Senate to, for once, stand up for policyholders and kill this unbridled attempt to deregulate our insurance market at the expense of policyholders."

To follow Paul Owers on Twitter, click here.

Is housing still making you miserable? Vote in our poll

Mon, 06 Feb 2012 06:30:00 -0500

For the second year in a row, the housing crisis helped West Palm Beach, Fort Lauderdale and Miami land on Forbes magazine’s list of the nation’s most miserable cities.

Last year was the first time Forbes used housing as a factor in the rankings. And with prices still declining, the region remains a prime target for naysayers.

But is it right to still use housing against us? Sales have been strong, prices have stabilized in many areas and the market appears to be searching for a bottom. Analysts say South Florida is in the middle of a slow recovery. What’s so miserable about that?

Tell us what you think and vote in our poll.

Ask a real estate pro: Will Obama's new mortgage plan make a difference?

Fri, 03 Feb 2012 07:45:00 -0500

Q: I heard in the State of the Union address that President Obama has a new plan to fix the mortgage situation and help struggling Americans. I’m also having some problems with my mortgage, and my property is underwater. Is this plan going to finally save me? -- Anonymous

A: I’ve been asked a lot in the past few days whether President Obama’s plan to fix the housing crisis will actually work. The plan being proposed by Obama is the third bite at this particular apple. Similar plans were adopted by then-President Bush and later Obama. Both of those previous plans had little effect. In this latest initiative, the homeowner must be current on his or her payments and can only refinance the mortgage as long as the loan to value does not exceed 140 percent. Later, if there is a foreclosure on the new loan, the federal government will pay back the lender some, if not all, of its losses. The President’s idea is that when the government refinances loans at a lower interest rate, homeowners will take the savings and buy other items, thereby helping the economy. Other tenets of the program include a homeowner's bill of rights and the bulk sale of foreclosed homes to investors.

Pundits are saying that this program is unlikely to be approved due to political infighting. That may not be such a bad thing because I see little different in this program for the average homeowner. I don’t think this program would do enough to improve a homeowner’s situation. The people who need the most help are those who can no longer keep up with their mortgage payments, but they wouldn't qualify for aid. While everyone paying their mortgages would benefit from lower rates and save $100 to $200 a month, it's not enough of a savings to make a difference for someone who is $60,000 underwater on a $150,000 home.

To follow Gary Singer on Twitter, click here.

Trulia.com: House hunters still flock to Florida

Thu, 02 Feb 2012 10:00:00 -0500

Where online house hunters are looking
1. Palm Bay
2. Winter Haven
3. Bradenton
4. Fort Myers
5. Tulsa, OK
6. Palm Beach County
7. Broward County
8. Riverside, Calif.
9. Charleston, SC
10. Orlando
Source: Trulia.com

Despite the threat of hurricanes and a tsunami of “underwater” mortgages, potential home buyers still view the Sunshine State as paradise.

Among the top 10 metro areas nationwide where demand among online house hunters is strongest, seven are in Florida, according to real estate website Trulia.com.

Palm Beach and Broward counties are sixth and seventh on the list, respectively. In each county, there are more than twice as many people looking to move than leave, Trulia says. The only non-Florida metros on the list are Tulsa, OK., Riverside, Calif., and Charleston, S.C.

Following the busy hurricane seasons of 2004 and 2005, plenty of people left Florida and talked of leaving, fed up with the storms and soaring property taxes that resulted from the housing boom. Nothing like big price declines and great weather to keep people wanting to live here.

“Although locals in Florida, inland California and the Southwest are suffering from high foreclosure rates and lost equity, huge prices declines since the height of the housing bubble have drawn house hunters from across the country,” Jed Kolko, Trulia’s chief economist, said in a statement.

Miami man charged with submitting fraudulent PIP claims

Wed, 01 Feb 2012 11:44:33 -0500

From Staff Writer Doreen Hemlock: A top Florida official Wednesday announced an arrest for alleged Personal Injury Protection (PIP) fraud, as the Scott administration revs up its campaign for a new PIP auto-insurance law.

Florida Chief Financial Officer Jeff Atwater, pictured at right, said an investigation into insurance fraud led to the arrest of a Miami man accused of submitting fraudulent PIP claims from an unlicensed health clinic.

Juan M. Dieguez, who also used the identity Jorge R. Gonzalez, is charged with operating a health care clinic without a license, grand theft and insurance fraud. He owned and ran Venetian Rehab Center, at 434 SW 12th Ave., since October 2010, but was arrested while working at another clinic, Therapy-Diagnostic, Tech Medical, according to a statement from the CFO’s Office.

Dieguez is being held on $65,000 bond at Miami-Dade County Jail. If convicted, he faces up to 15 years in prison, the statement said.

“Insurance fraudsters have learned how to game Florida’s PIP system, and every honest Floridian with a car in the driveway ends up paying,” Atwater said in the statement. “We must put policies in place to stop those who make a career out of stealing our fellow Floridians’ hard-earned dollars.”

The arrest comes as Gov. Rick Scott and his administration push for changes in Florida’s no-fault auto insurance to reduce PIP fraud. Current law requires Florida drivers carry at least $10,000 Pip insurance coverage for expenses related to personal injury after an auto accident, no matter who was at fault in the crash. Administration officials have backed a House bill that would limit PIP medical coverage to emergency rooms at hospitals.

For more on PIP reform, see our Jan. 21 story here.

Mortgage writedowns to increase under revised HAMP?

Wed, 01 Feb 2012 11:24:44 -0500

The government late last week announced changes to its main foreclosure prevention initiative, the Home Affordable Modification Program.

One big change: The U.S. Treasury now will triple the financial incentives for lenders that forgive a portion of homeowners’ mortgage debt.

And on Wednesday, President Obama announced another refinancing plan for underwater borrowers.

From Reuters:

President Barack Obama on Wednesday called on Congress to approve a $5 billion to $10 billion effort to help U.S. homeowners refinance as part of a wider package of proposals to shore up the depressed housing market.

Obama had sketched out the proposals in his State of the Union address last week, including a tax on banks to pay for the plan that Republicans quickly rejected.

The White House offered more details on Wednesday ahead of a speech by Obama to expand on his initiative, which some Republicans have derided as an election-year ploy.

Refinancing will help, but analysts say the scope of the housing crisis is so broad that reducing mortgage balances is the best way to get out of this mess. So far, though, the writedowns have been few and far between.

Have you asked for and/or received a writedown already? What do you think of the revised HAMP?

Case-Shiller index: Home prices continue to fall

Tue, 31 Jan 2012 10:15:00 -0500

Home prices fell in South Florida and across most of the nation in November, according to the Standard & Poor’s/Case-Shiller home price index released Tuesday.

Prices in Palm Beach, Broward and Miami-Dade counties declined 0.5 percent from October and 4.4 percent compared with a year ago.

Nineteen of the 20 cities measured by the index endured price declines from October. Phoenix was the lone exception.

Eighteen of the 20 metro areas had lower prices compared with a year ago, with Detroit and Washington, D.C., the only cities to see price increases. Detroit, hit hard by the housing collapse and other economic woes, has performed surprisingly well in the index recently.

“Despite continued low interest rates and better real GDP growth in the fourth quarter, home prices continue to fall," David M. Blitzer, chairman of the index committee for Standard & Poor's, said in a statement.

Case-Shiller is one of the most respected measures of home prices because it tracks the price of the same house over time. The Florida Realtors trade group releases a monthly median price, but many analysts say the median is misleading because it reflects only the value of what sold during the month -- not the value of all homes in an area.

The Florida Realtors said Broward's median price rose 4 percent last year to $186,000.

The Case-Shiller index lags Florida Realtors' data by a month and does not include condominiums.

The Florida Realtors measures prices in Palm Beach, Broward and Miami-Dade counties separately while Case-Shiller includes data for all three counties collectively.

To follow Paul Owers on Twitter, click here.

Photo Courtesy: Getty Images

Report: Foreclosure lawyer Stern has a stake in hamburgers

Mon, 30 Jan 2012 18:10:00 -0500

David Stern, whose Plantation law firm was at the heart of the “robo signing” foreclosure scandal, now is investing in hamburgers, The Palm Beach Post reports.

Stern has thrown money behind a company that owns Five Guys Burgers and Fries franchises.

Stern’s firm was accused of rubber stamping hundreds of thousands of foreclosure cases without reviewing them. Mortgage giants Fannie Mae and Freddie Mac pulled their cases from the firm. He later folded the law practice.

Orlando Sentinel file photo

Investment group buys Delray Beach rental communities

Mon, 30 Jan 2012 18:00:00 -0500

A pair of Delray Beach apartment complexes two miles apart have changed hands.

Acumen Real Estate, an Aventura-based investment group, bought Water’s Edge and The Fountains at Delray Beach. The properties have a combined 297 units and are 95 percent occupied.

Water's Edge, pictured at right, sold for $16.75 million, and The Fountains fetched $19.25 million, records show.

The seller was Archon Group, represented by the ARA brokerage in Boca Raton.

Investment groups are attracted to apartment complexes as more homeowners turn to rentals in the wake of the housing bust, said Avery Klann, a broker for ARA.

Staff researcher Barbara Hijek contributed to this report.

Photo courtesy of ARA

Fiserv: Broward home prices to fall through late 2013

Mon, 30 Jan 2012 14:52:56 -0500

Home prices in Broward County will continue falling through much of 2013, financial services firm Fiserv said in a report released Monday.

Broward prices are projected to drop by 10.2 percent through September of this year and then 3.4 percent through September 2013.

From there, the dark clouds break up a bit. Broward prices are expected to creep up slowly through late 2016.

The outlook is brighter for Palm Beach County, where prices are projected to hit bottom later this year. Prices will increase 2.9 percent through the third quarter of 2013 and 6.7 percent by late 2016.

“What we’ll see in many Florida markets is pretty strong price appreciation when things start to recover,” said David Stiff, chief economist for Fiserv.

Fiserv's forecast differs slightly from Moody’s Analytics, which predicts a price bottom for Broward in early 2013.

The Fiserv report is based on data from the Standard & Poor’s/Case-Shiller home price index. The latest Case-Shiller figures will be released Tuesday.

Case-Shiller records prices of the same house over time, and many analysts believe that's a more accurate measure of values than releasing a median price for homes sold in a month, as the Florida Realtors trade group does.

The Florida Realtors said Broward's median price rose 4 percent last year to $186,000.

To follow Paul Owers on Twitter, click here.

Getty Images file photo

Ask a real estate pro: Why bother with a short sale?

Fri, 27 Jan 2012 06:00:00 -0500

Board-certified real estate attorney Gary M. Singer answers housing questions in this space each Friday. To ask him a question about short sales, mortgages, refinancing, homeowner's associations or any other residential real estate topic, click here.

Q: I have been relocated, and my property is underwater. My credit is not important to me, so I am thinking about just walking away from my house as opposed to taking the trouble of doing a short sale. Is there any reason I should not just walk away? – Anonymous

A: Yes. If you just walk away, you are doing more damage than just accepting a bad credit score. You have the strong possibility of a money judgment following you for 20 years. Also, you are hurting your neighbors by not paying association dues and by leaving an abandoned property in the neighborhood. Further, there are psychological ramifications from abandoning a responsibility, hurting your neighborhood and not trying to gain closure for yourself. You and your neighbors are much better off if you work with your lender to complete a short sale or a deed in lieu of foreclosure. Aside from the benefit you gain in a legal sense, trying to do the right thing is its own reward.

Q: I just received updated paperwork, and my house has been removed from a flood zone. I have sent copies to the mortgage company. Can the bank still make me carry flood insurance? – Natalie

A: No. Under most mortgage loans, you have to carry flood insurance only if you are in a flood zone. However, in all contractual relationships, it is the paperwork that makes the rules, so check yours to make sure of the answer for your individual situation.

Q: One day I came home to find that my neighbor had cut down several mature shrubs on my side of the property line. I spoke to him about it a while ago, and he said that he thought they were his and that he would replace them with new plants. But I’m still waiting. What can I do? – Anonymous

A: You should make every effort to work this out before taking any court action. It is not a great idea to be involved in any lawsuit if it can be avoided, especially if it is someone you will see every day. If all of your efforts to resolve this in a friendly way fail, you can try to sue him. While your neighbor is allowed to cut branches and roots that extend onto his land, he is not allowed to cut anything over the property line. If you are successful in the lawsuit, you will be able to collect the value of the plants or the reduction of your property value from the neighbor. But, again, try your best not to let it reach that point.

The information and materials on this blog are provided for general informational purposes only and are not intended to be legal advice. No attorney-client relationship is formed, nor should any such relationship be implied. Nothing on this blog is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction.

To follow Gary Singer on Twitter, click here.