February « 2009 « MostlyForeclosures Articles: Online Foreclosure Homes Database And Foreclosure Information

Archive for February, 2009

Help for Renters Displaced by Foreclosure Listings

Friday, February 27th, 2009

President Barack Obama’s $75 billion foreclosure program has been applauded for its efforts to help troubled homeowners, stabilize the housing market and ultimately help rehabilitate the country’s economy. But some groups are disappointed because of the miniscule help allotted to adversely affected renters. Obama’s program set aside only two percent of the foreclosure fund to renters although about 20 percent of homes in foreclosure listings are rental properties.

Some analysts explained that renters were probably overlooked and were not given much focus because they are renting residential properties bought by speculators and irresponsible investors who did not keep up with payments although they were receiving rental payments from the renters.

The case of Kamilah Taylor and her young children is an example of a responsible family that became victim of properties that suddenly became included in foreclosure listings. Taylor paid her rentals religiously, maintained the property and got along well with neighbors. All the same, Taylor and her children were forced out of the property when the landlord failed to pay his loan and the property was included in foreclosure listings. Her problems were also compounded when her landlord failed to return her security deposit.

California laws require landlords to return the deposits of their tenants, but when landlords refuse to return the deposits, most tenants could not do anything. They do not have money to file lawsuits and they do not have the time to pursue anything other than to find another place for their families.

Taylor was still more fortunate than most other renters because when her landlord failed to return her security deposit, The Chronicle’s Season of Sharing Fund in California helped her financially to enable her to rent another property. The fund has been helping people like Taylor adversely affected by long foreclosure listings and other effects of the economic downturn.

In California, foreclosures wipe out the rights of renters. The lenders, after adding foreclosed residential properties to foreclosure listings, either offer new lease contracts to the renters or force them out on two month’s notice. Lenders however usually want to focus on lending so they prefer evicting the renters who are almost always unprepared to transfer to another place.

In light of the difficult situations of renters, Obama’s administration need to include them in efforts to help Americans displaced by the rising number of homes added to listings of foreclosure.

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Who Are to Blame for the Millions of Foreclosure Homes?

Thursday, February 26th, 2009

Many critics of President Barack Obama’s administration, mostly from the opposition, and some groups not necessarily critical of Obama, have blamed ordinary working Americans for the rapid rise in foreclosed homes across the country. They say that these homebuyers were irresponsible for not keeping up with their monthly payments.

Some of these homebuyers are also called stupid or reckless for taking up mortgage loans that in the first place they could not afford to pay. The critics say these troubled borrowers are to blame for the glut in foreclosure homes and they should not be bailed out with responsible taxpayers’ money.

Fortunately, these ordinary homeowners have voices in government, such as Massachusetts congressman Barney Frank and Federal Deposit Insurance Corporation Chairman Sheila Bair. Both Bair and Frank, also chairman of the House Financial Services Committee, have been campaigning for the rescue of troubled homeowners to avert the rising number of home foreclosures. But they were rebuffed because critics say owners of foreclosure homes are too blame for their foolishness.

But at last, as the foreclosure problem is being debated in the media and in various circles, the reality that financial hotshots and Wall Street financial companies had big contributions to the mess is surfacing.

These financial hotshots offered mortgage loans to as many borrowers as they can fool without checking if the borrowers can really pay the loan. They were only interested in making commissions. They even offered adjustable-rate mortgage loans to attract borrowers knowing very well that the borrowers will not be able to keep up with the monthly payments after the first years.

To make more money from these loans, Wall Street firms packaged them into complex financial instruments and sold them to foreign investors. When the boom years passed, reality set in and the borrowers could no longer pay their loans. More and more defaulted, starting the flood of foreclosure homes.

When President Obama released the details of his $75 billion foreclosure program, the critics surfaced again, claiming that the program is taking away money from responsible borrowers and taxpayers to give to irresponsible owners of foreclosure homes. If the critics study the details of Obama’s program, they will see that there are controls to the program to prevent abuse. They will see that the most irresponsible homebuyers they are referring to are excluded from the program.

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Options to Help Stop a Home Foreclosure

Monday, February 9th, 2009

If you are one of the many Americans who want to know how to stop foreclosure or simply want to get informed about it, then these options are for you.

Refinancing

Do this if you have: a good credit history — no late payments since refinancing may be quite difficult to obtain these days for someone with monetary problems.

How it works: Refinance your mortgage at a lower rate interest or a decreased monthly payment to stop foreclosure homes. Contact a trustworthy broker or mortgage lender for advice. Check the web for current mortgage rates or to compute for actual costs of refinancing.

Ask for Government Help

Do this if: the mortgage was originated before January 1, 2008. Existing payments must be over 31 percent of your gross income.

How it works: One program to help stop foreclosure is the Hope for Homeowners, a brainchild of the Department of Housing and Urban Development (HUD). This program assists homeowners in refinancing their mortgages in a 30-40 year period. Check the Hope for Homeowners website for all details and requirements.

Loan Modification

Do this if: you are experiencing temporary hardship, like temporary unemployment.

How it Works: Eliminates or lowers some of your payments. Call your lender for a possible forbearance agreement.

“Deed in Lieu” of foreclosure

Do this if: you want to stop foreclosure from appearing in your credit history

How it works: Basically, you give your home back (Turn over the deed or title) to the mortgage holder

Loan Modification

Do this if: you can still afford a lower monthly mortgage

How it works: terms for paying the loan is permanently lowered or extended, with delinquencies incorporated into future payments. Ask your mortgage lender to consider this option.

Other people may be tempted to consider offers to help stop foreclosure from “equity skimmers” who offer to take ownership of the home or sell the house for you. Instead of risking getting taken advantage of, contact a broker, lender or realtor you trust.

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In Fixing the Foreclosure Problem, Obama Gives Thumbs Up to Mortgage Aid for Combating Recession

Friday, February 6th, 2009

In Washington DC, President Barack Obama vows to provide relief to the housing and foreclosure problem with a different financial plan that targets the root origin of the never-ending U.S. recession. His plan might receive the approval of the public as he hopes to balance the enormous bank bailouts through help for troubled homeowners.

The President assures that mortgage costs will be lowered as a part of the financial rescue plan that he will be revealing soon in order to improve the banged up economy that has been hit by the most severe financial crisis from the time of the infamous Great Depression.

The proposed mortgage support especially for the foreclosure problem can possibly alleviate housing markets as an excess of homes not sold has forced down prices as well as reduced construction. Maybe the delivery of help to the strained homeowners can reduce the increasing political and public fury on the government spending over billions of dollars to fix the country’s financial services industry.

However, the hope for a major improvement in housing continues to be vague. Single-family homes that were newly built dropped 14.7 percent last December, which was the biggest monthly drop since 1994, as sales stumbled to the slowest yearly pace ever since 1963 when the government started keeping records.

In considering a lifeline to the strained housing markets, the administration of Obama could relieve stem losses at the U.S. banks which have been battered hard with bitter mortgage assets.

Battling the Foreclosure Problem

Policy-makers in the Federal Reserve of the U.S. have lately focused on mending real estate residential markets as being part of nurturing the economy back to its healthy state. Donald Kohn as the Vice Chairman of the Fed has strongly supported the proposal of utilizing government rescue funds to decrease mortgage foreclosures. Preventable foreclosure properties not only bring damage to the distressed borrowers and their various communities, but also the larger economy and the country’s financial system.

Most analysts assume that the administration will eventually have to request even more money to fix the damaged financial system, including several price estimates of going up to $4 trillion, even if the government might be able to allocate loan guarantees which would cost not as much.

In order to be able to get those funds, the Obama administration has to pacify the public indignation that the Wall Street companies are acquiring government bailout funds even when many people are becoming unemployed, losing retirement savings and their homes.

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A Brief Guide on Buying Foreclosure Homes

Thursday, February 5th, 2009

Even though many home owners in various parts of the country are still going through or facing the threat of foreclosure, many of the nation’s market analysts are of the opinion that a bottom point should be expected some time within the next twelve months. The newly elected President has also promised to take sterner measures to try and curb the problem.

This expected relief is getting a lot of buying plans that were put on hold into the market, and there seems to be particular interest in foreclosure homes. Recent data has shown that foreclosure homes account for a significant percentage of the overall numbers of home sales. The reason for this interest is the low prices that are associated with the sales of most of these homes.

Home foreclosures are being looked at with interest by investors and first time home buyers alike. With the savings that are to be made, this comes as no surprise.

If you do intend to buy a foreclosure affected home, you should ensure that you conduct a thorough search to look for homes that suit your requirements. If you plan to get a mortgage to buy the home, it is best that you get pre-approved before embarking upon your search. This would give you a clear indication of the budget that you need to restrict your search to.

The internet is a good source of looking for nation wide foreclosure affected homes. You can get in touch with banks and real estate agents to look for these homes, and can also go through local publications that carry foreclosure advertisements and notices.

With there being a wide range of options to choose from, you should ideally take some time in going through your resources before coming to a decision.

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The Role of Counselors in Troubled Homeowners’ Lives

Wednesday, February 4th, 2009

Homeowners trying to avoid foreclosure have two options: call their lender or get help from a nonprofit counseling agency. They say the second option is better.

But what is this role that counselors perform in the life of a troubled homeowner?

Housing counseling is what they offer. Homeowners who are behind their payments are more inclined to consult a housing counselor for faster accommodation of their problems. Why? Because more often, the lines of lenders are busy for they take a long time asking this and that questions and saying everything in a single call. They even fail to record calls so some callers’ dilemmas have been missed out. This is probably with the kind of training of their employees.

Housing counselors actually have access to supervisors who can make certain decisions when it comes to loan modifications and mortgage repayment plans. This is why processing is faster. The counselors just get the needed information, do some evaluation and come up with a workout plan to be submitted to the supervisor.

Workouts can involve forbearance, wherein a borrower pays extra every month for one or two years to repay the past-due amount. Mortgage modifications are done through lowering the interest rate (freezing), forgiving a portion of the debt, or by extending the date of payoff.

Publicity campaigns have been conducted by government officials, mortgage servicers, and nonprofit agencies to inform everyone, especially homeowners facing foreclosure that foreclosure-prevention help is available.

Another good thing is that, four mortgage servicers—Chase, CitiMortgage, Ocwen, and SPS—have partnered with Chicago’s National Training and Information Center and has now created an information-gathering form to be sure that only necessary information would be asked from the borrower and for faster action too.

Distressed homeowners can survive foreclosure for as long as they know who to approach when faced with such a situation.

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Texas Foreclosures Continue in 2009

Tuesday, February 3rd, 2009

2008 has been challenging to the real estate industry. This has been shown by the foreclosure records in Texas last year. The 2008 year-end report by RealtyTrac has reflected a total of 96,157 filed foreclosure notices in Texas, which is about a13.84 percent increase from that of 2007, and a 14.9 percent increase from that of 2006.

The records are actually based from the three foreclosure phases: default, bank repossessions, and auction.

San Antonio has been listed as the No. 70 in the Top 10 metros with the highest rates of foreclosure, having 1.09 percent of its properties noticed for foreclosure last year.

The Texas foreclosure records in 2008 results to a non-favorable start for this year; that is why the housing industry could get even worse.

Meanwhile, Addison has reported a total of 1,261 foreclosure filings in Bexar County for the February 3, 2009 auction; and this is 15 percent higher from the 1,098 postings in the February 2008 auction. These foreclosure notices are actually results of delinquencies on homeowner’s association fees or mortgage payments. In fact, the 1,261 postings imply a “new record level high” for Bexar County foreclosure filings.

Homeowners do not have to assume that the housing industry will get better this year. In California, 4 countries have actually made it to RealtyTrac’s Top 100, which included Stockton on the no.1 spot.

There have been a total of 2.33 million properties in the US that reached the foreclosure process, which means an 81 percent increase from those listed in 2007, and a 225 percent increase from those in 2006.

The continuous rise of foreclosure properties has highlighted the lack of effectiveness of current foreclosure prevention programs. In fact, the laws enacted by several states such as California, Maryland, and Massachusetts, just delay the foreclosure process but do not totally stop it.

Texas foreclosures should be stopped, and its government really has to do a more effective action about it.

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Investor Team Assures Homeowners Can Handle Foreclosure Crisis

Monday, February 2nd, 2009

Adjustable-rate mortgages (ARM) are expected to readjust in 2009, according to members of Forbes.com Investor Team. However, members of Forbes.com Investor Team believe that homeowners can deal with the mortgage rate resetting.

Soleil Securities chief investment adviser and Forbes.com Investor Team member Vincent Farrell warned that ARM will be readjusted in 2009 which may further aggravate the foreclosure problem and housing prices.

Meanwhile, Gary Shilling, another member of the Investor Team, has predicted that home prices may decline further by 20 percent and affect efforts to reduce the number of foreclosure homes. He warned investors to sell stocks that include home builders such as KB Home, Toll Brothers and Lennar, consumer and housing-related stocks such as banks that have credit card business and manage consumer-loan portfolios.

Farrell explains that with an estimated $200 billion ARMS outstanding, about $29 billion are expected to reset in 2009 and another $67 billion in 2010.

On the other hand, author of the blog Broke and Broker and securities attorney Bill Singer does not believe that the United States government will allow a foreclosure crisis to spread around the country’s economy. He expects the Congress and the White House to find some solutions to abate foreclosure properties, whether a moratorium or subsidized payments to struggling homeowners.

“A Bull for All Seasons” author and Deutsche Bank’s DWS Securities chief investment strategist Doctor Bob Froehlich agrees that the incoming administration of President-elect Barack Obama will help homeowners avoid foreclosure.

Froehlich also believes that mortgage borrowers may be able to handle potential resetting of ARM. He points out that homeowners chose the lowest mortgage payment possible and do not plan to just sit and wait for the higher ARM to materialize. He adds that homeowners are waiting for lower rates so that they could shift into fixed rates with substantial increases in monthly mortgage payments.

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