Mike’s Real Estate Show

You hear me quoting Lou Barnes on my radio show every week. His genius is an ability to cut though the fluff and political shouting to the heart of the matter of a subject. Here he goes after the new “assistance” package. Part of the bill is the ability to ”refinance” your home to get out from under the big payment and loan amounts. Here are his thoughts which use numbers for a “national” audience. The thought process works for our area:

“The new housing assistance bill, dismissed here briefly last week, deserves a more thorough hatchet-job.
     It’s centerpiece is a $300-billion FHA loan guarantee (not money) to refinance under-water home “owners.” Consider a Bubble-Zone victim who bought a $200,000 home five years ago, made a 5% down payment and got a 5-year interest-only ARM for $190,000. The home has fallen 25% in value to $150,000. She has made interest-only payments since, and her $190,000 loan is entering amortization reset.
     Her rate is not bad, 5.50% even after adjustment. However, her payment will jump from $871 to a killing $1,167. To her rescue, the bill’s “Hope for Homeowners.” In the land of unfortunate acronyms, gotta call it HoHo.
     HoHo provides for a write-down of the mortgage to 90% of current market value, to $135,000, plus a 3% refinance fee to the FHA, $139,000 total. HoHo further provides a 1.5% annual surcharge; added to 6.50% current market equals 8%, amortized for 30 years is $1,020 per month. Better by a little, possibly affordable, equity negligible, pride failing. Then there’s HoHo’s anti-equity kicker: when the place appreciates in value (how many years ahead?), and she either refinances off the 8% or sells, HoHo will take half of any appreciation. I bet HoHo won’t split costs.
     While she considers HoHo humiliation, a new renter moves into the house next door, identical, rent $700. Millions of people just like her are now condemned as “Walkaways.” Read the rest of this entry »

Want to get involved in the foreclosure market? Think your neighbor might be in default? Just plain curious about how many foreclosures are in your zip code?
Check out this web site. My critique of this site is its reliance on “Zillow” and there oft wrong “Zestimates” which on one property gave a price range of over
$130,000!! If I did that I’d get run out of the house. And there mission statement refers to giving the public foreclosure information for free  but if you want the Parcel Number,Grantor/Borrower, original auction date and current status you’ll have to pay $79.00 per month for this info!! That’s pretty pricey.  But if you’re just curious about what’s going on check it out for free. Even the “Free” information is pretty telling. Here is the Link: http://www.foreclosurepoint.com/fp/root/home.do

O.K. here’s the deal–whine, stomp your feet, start a blog and svetch like crazy about how you can’t get a response in your agreed upon SLA–I’m sure you’ll feel much better for it. However, you’ll NOT get the property you wish! Conversely, you can grit your teeth, be paitient and try to truly understand the nature of the market.

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It all depends. In certain areas of Santa Rosa the $299,000 price might be $50,000-100,000 below the marekt price. The Assett Manager and his Realtor/Licensee have made a marketing decision to get it way below the market to be percieved as a super-deal–hence, buyers/agents drive up the price. We’ve been seeing these shennanigans with comments in the confidential remarks section saying, “20 offers now on the table–don’t bother submitting any offer under $350,000″ and the property is listed for $259,000!!

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A listener asked me if the rumors of “Multiple Offers” was nothing but Realtor Hype?
If Realtors could “hype” up business through manipulation of our MLS pricing structure, you’d think we’d all done this before  the 30-50% pay-cut we’ve all taken over the past 3-4 years plus the lost equity of our clients! In the REO market, for my County of Sonoma $200-$500,000, we are getting multiple offers. It is a SELLER’S market for many an assett manager.

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MAKING SENSE OF THE LATEST FORECLOSURE NUMBERS FOR CONSUMERS–This synopsis provided by the California Assoc. of Realtors

3.6 percent of borrowers were at least 90 days late on their payments in December – the highest percentage in more than five years, reported the Mortgage Bankers Association. Even so, it’s important to remember that 96.4 percent of borrowers were on time with their mortgage payments. And new foreclosures accounted for only 0.83 percent of all home mortgages in the fourth quarter of 2007, up from 0.54 percent in 2006. Read the rest of this entry »

This Easter Sunday we are discussing interest rates and foreclosed properties. Here are some terms you’re hearing everyday which might need clarification. In today’s market we have “pre-foreclosure”, “Foreclosure” and “Post-Foreclosure” properties and events along this cycle. A “Short-Sale” is a Seller who owes more on the property through his loans than the property is WORTH. Read the rest of this entry »

The civil Code for foreclosures is very long and complicated. I put this up to simply give you an idea as to WHY you should consult an attorney!! But it does spell out the processs in no-nonsense terms. Use it as a guide. Since I don’t practice law I leave it at that!!

http://www.leginfo.ca.gov/cgi-bin/displaycode?section=civ&group=02001-03000&file=2920-2944.5

Foreclosure Process

California has a non-judicial system to carry out a foreclosure of a deed of trust. That means  that no court procedure is required for a lender to sell the property to satisfy the debt. Some states carry out a formal judicial process which tends to be lengthier, and frequently have a redemption period after the sale. Here in California, the judicial process is available, but rarely used. The following steps will outline what is all involved in a non- judicial foreclosure.

1.) MISSED PAYMENTS OCCUR. Usually after the third missed payment the lender will initiate a foreclosure. There is no law that dictates the number of payments that must be missed, but most trustees won’t proceed unless the loan is more than 30 days in arrears. This is done by issuing a Declaration of Default and Demand for Sale which is passed on to the foreclosure trustee.

2.) DEPOSIT DEED OF TRUST AND NOTE WITH TRUSTEE. The lender (beneficiary) deposits the deed of trust and note with a foreclosure trustee. If there has been an assignment of the deed of trust, such assignment must also be deposited. If the original note has been lost, foreclosure can still be commenced, but the beneficiary must post a lost instrument bond in most cases. (18 more steps follow this first one–get to know the process if you are having issues with your loan and may be easing into this process with your loan!) Read the rest of this entry »

Here’s a great article which I found today as an alert from the California Association of Realtors. I think we need to always put “National” numbers into perspective. We sometimes think, and rightly so, that our little world of Sonoma County is the center of the universe. This may be true for us but projecting our financial woes on the rest of the country gives one a dismal outlooks as it’s not all that bad out there!! Read on! 

 Foreclosure ‘crisis’ is overblown
Sure, there are pockets of pain around the US, but it’s not as if most Americans are losing their homes. More than 99% of homes aren’t in foreclosure.
By Scott Burns MSN Money
A recent list of year-end mortgage foreclosure rates in 100 top metropolitan areas drew a lot of attention. Released by RealtyTrac, a company that compiles data on home foreclosures, the list showed the number of foreclosure filings in each metro area, the percentage of homes being foreclosed and the percentage change from the previous year.

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