Archive for the 'Foreclosure Help' Category

Preliminary results of a market study showed that a growing number of troubled homeowners have saved their properties from bank foreclosure listings through short sale.

Short sale is being pushed as an alternative to repossession for distressed homeowners who want to avoid the complex foreclosure process and move out of their homes without doing any long-lasting damage on their credit history.

And short sale is fast creating its own niche in the real estate market in Dayton, Ohio. According to industry experts, short sale has started to become a growing market segment due to the effects of economic and housing crises, with the addition of medical problems, job loss or divorce.

Through short sales, distressed homeowners facing the possibility that their homes will be placed on bank foreclosure listings may limit the negative effect on their credit history and may easily and quickly become eligible to purchase another property.

On the part of lenders, short sale may prevent them from collecting the full unpaid mortgage due from homeowners, but they will be spared from the expensive costs of foreclosure and the added burden of maintaining and reselling the distressed properties.

Early this year, short sales accounted for 13 percent of the total home sales in Ohio, placing the state in the range of 10 to 20 percent reported doing short sales nationwide.

According to the National Association of Realtors, about one in every three homes on bank homes listings was sold through short sales and not through foreclosure auctions. Furthermore, the market trend indicated that an estimated 5,000 distressed homeowners in Butler, Greene, Miami, Montgomery and Warren counties could sell their properties through short sale this year.

Despite its potential to save homeowners from foreclosure, short sale has its own disadvantages such as less profitability, time consuming and the need for greater cooperation between lenders and distressed homeowners. This is especially true in cases where there are court-imposed deadline on the foreclosure.

Homeowners who opt for short sale are required to submit comprehensive information that will prove their financial difficulties to justify availing of a short sale. Most title companies determine the extent of homeowners’ liabilities, such as credit card judgments and second mortgages, by doing a background check on the property’s title.

Usually, lenders used net proceed figures to decide whether to approve a short sale to help homeowners avoid the trouble of placing their homes on bank foreclosure listings.

A meeting to address the effects of bank owned foreclosures were attended by distressed homeowners and renters in Grand Rapids, Michigan. The Foreclosure Response meeting provided information on the foreclosure mediation law and its benefits to renters and homeowners who are fighting foreclosures.

A growing number of renters in Michigan and across the United States have become innocent victims of the foreclosure crisis. Most often landlords would not inform their tenants that they are renting bank owned foreclosures. And renters would scramble to find another affordable home to live in a short period of time.

The meeting, where homeowners and renters shared their horrifying experiences with foreclosures, coincided with the National Day of Action.

Foreclosure Response event organizer Kym Spring said that everybody should cooperate and get active on the fight against foreclosure. According to data released at the meeting, the foreclosure rate in Grand Rapids rose to 1,753 houses in 2008 from 551 in 2004.

Hardest hit neighborhoods are South East with 214 foreclosed properties, Garfield Park with 267 and 213 in Creston. Participants of the meeting were being told that being pro-active may mean a lot when facing foreclosure.

In May, a foreclosure mediation bill was approved which gives an opportunity to homeowners to coordinate with nonprofit housing counselors for free and request a mediation meeting with lenders to work on loan modification.

Meanwhile, the Protecting Tenants in Foreclosure Act requires that all renters of bank owned foreclosures should be given at least 90 days prior notice before eviction. Also, renters have the option to stay on the foreclosed property until the lease expires.

Michigan is one of the states in the top 10 with high foreclosure rates in May. The state’s total foreclosure last month was 13,891. For the first quarter, the filings of foreclosures were made on 33,184 properties in Michigan, representing a 2 percent drop from the last quarter of 2008 but 12 percent higher than the reported 2008 first quarter period.

Michigan’s inclusion in the top 10 states with high foreclosure rates is attributed to its 12.6 unemployment rate. Industry experts agree that with the pace of foreclosure activity in the state, Michigan will continue to be among the leading states with the most number of bank owned foreclosures.

Dick Durbin, Senate Majority Whip and a close ally of President Barack Obama in the Senate, has criticized the administration of failure to contain Bank Foreclosure Properties that keeps on flooding the country and depressing the housing market.

Durbin said that he is skeptical about the voluntary loan modification approach and whether the program can help the country recover from the foreclosure crisis and the subsequent housing market collapse. The senator supported a bill which would have allowed judges to alter troubled mortgage loans.

During a financial services and general government subcommittee hearing of the Senate Appropriations, Durbin told U.S. Treasury Secretary Timothy Geithner that the Bush Administration and the Obama Administration have both failed to provide a solution that could significantly help contain the number of Bank Foreclosure Property.

He pointed out economic forecasts that about 8 million repossessed homes will flood the market in the coming years, on top of the almost 2 million distressed properties in the previous year.

Durbin supported a bill, endorsed by Obama, which would have allowed mortgage modifications. However, the bill never took off when both Democrats and Republicans opposed it and banks rejected it arguing that the legislation would reward homeowners who purchased homes that they could not afford.

Meanwhile, Geithner said that it would be some time before he would know whether the Obama Administration’s Make Home Affordable program aimed at helping distressed homeowners avoid Bank Foreclosure Properties would be a success.

But he told members of the Senate subcommittee that he believed that the program has the best incentive package that could help troubled homeowners and the best way to recover investments that can be used to address the housing market crisis.

The program is targeting to help as much as 9 million borrowers reduce their monthly loan payments to affordable terms. It is one of the major components of the Obama Administration’s efforts to stabilize and strengthen the languishing housing market.

he program includes a provision that would allow as many as 5 million homeowners who have good credit history and who have loans guaranteed by Freddie Mac and Fannie Mae to refinance their mortgages into affordable terms to avoid Bank Foreclosure Properties.

Geithner said that homeowners should expect more challenges ahead, with many more still on the brink of losing their properties to foreclosures.

A public hearing will be held at the Legislative Office Building in Stamford, Connecticut to discuss the plan to release and distribute about $3.6 million federal economic stimulus block grants to several cities and towns to help them purchase and rehabilitate properties on listings of bank owned homes.

In an effort to reduce government foreclosures, the Federal Housing Administration has tightened its screening process for mortgage brokers who are allowed to originate FHA loans.

The Arends couple, Barb and Larry, have three adopted children who have disabilities. In 2007, when they learned that they won a handicapped-accessible house in a contest, they were very ecstatic. They regarded the house as a fulfillment of their dream for their three handicapped children not knowing that it is on bank foreclosure list.

Renters of homes on Bank Foreclosure List need not worry anymore of sudden eviction because the Nevada Legislature has passed AB140, which is part of the state efforts to curb the impact of the foreclosure crisis.

One of the most disappointing bank owned foreclosure prevention program initiated by the federal government is the Hope for Homeowners. Since it was launched eight months ago, the program has managed only to help just one distressed homeowner secure a loan with affordable payment terms.

The Term Asset-Backed Securities Lending (TALF) will be expanded to residential mortgage-backed securities (RMBS) as part of the U.S. Federal Reserve’s effort to stop bank owned foreclosures and recession. The TALK expansion also aims to eliminate devalued bonds in banks to increase lending and boost prices.

Last week, the Obama Administration announced an expanded version of its $75 billion Making Home Affordable program as part of an effort to reduce the number of forclosed home. The enhancement offers incentives to lenders who allow a short sale. The original version of the program only focused on giving incentives to lenders who modify loan terms to make them affordable for distressed homeowners.