Archive for the 'Foreclosures' Category

Troubled homeowners who took out home loans from Freddie Mac and Fannie Mae have been given an early holiday gift. The two housing institutions have announced a six-week moratorium on foreclosures. This moratorium is expected to give homeowners time to negotiate with Fannie Mae and Freddie Mac. For distressed homeowners who took out home loans from other mortgage banks, they might also be given reprieves in a week or two as more mortgage banks have been considering moratoriums.

According to financial analysts, even borrowers holding underwater mortgages can save their homes from foreclosures. Underwater mortgages refer to loans held by borrowers who owe more than their homes are worth. Since 2006, underwater loans have become common as the prices of homes kept falling following the subprime crisis.

Economists found that most underwater mortgages are in geographic areas where home developers have overbuilt. The supply of homes has surpassed need to a level that enabled a lot of persons to take home loans even if they really can not afford to buy a house. When the prices of homes dropped to very low levels, it was easy for these borrowers to walk out their loans because walking out has become the better option.

Mortgage analyst George Roddie said that foreclosures may have peaked out in communities with the highest foreclosure rates. Vulnerable borrowers in these hard hit communities had been forced out from their foreclosed houses immediately following the subprime meltdown and many others followed in the months after.

Another reason Roddie thinks foreclosures will no longer rise at a rate as in previous months is the increased willingness of mortgage lenders to negotiate with borrowers following the release by the U.S. federal government of billions of dollars to enable them to help distressed borrowers.

For borrowers who have been delayed in their monthly payments, they should contact their mortgage lenders to negotiate a schedule that will enable them to avoid foreclosure.

The Lao Family Community Development Inc refugee center was established 28 years ago by grateful families who escaped the wars in Southeast Asia and would like to give back to the community after this seeming miracle that they experienced in their lives.

The center was dedicated to providing low-income immigrants and refugees who lacked English knowledge to adapt a life in the United States and achieve financial and social self-sufficiency. Now, the center has shifted focus and has started assisting not only refugees but any East Bay homeowners in desperate need of assistance in preventing foreclosures.

For families in fear of losing their homes to foreclosures, the center provides assistance and counseling in English, Chinese and a variety of Southeast Asian dialects. With over 30 to 40 calls a day, the center has been receiving more requests for foreclosures related inquiries, along with their regular service offerings.

The center is headquartered in the San Antonio district of Oakland but also has offices in San Pablo and Sacramento, regions that were also hard-hit by the foreclosures crisis. Cramped in a 5,000 square foot location in 23rd Avenue where the center has held office for several years, people flock to this location seeking help with foreclosures.

Several years before the current foreclosures crisis blew out of proportion, the center has been tapped by the Federal Department of Housing and Urban Development to provide counseling services to low-income families seeking assistance in housing. They have had several successes in this regard from getting up to $4000 down payment assistance to acquiring long-term mortgages for their homes.

But now, their staff has been getting frantic calls and visits from homeowners seeking help: from asking for emergency funds to pay mortgages, to assistance in negotiating with their lenders to modify their loans.

However, most of these homeowners are already in too deep with their mortgage problems that it would take another miracle to bail them out.

The significant drop in numbers for pre-foreclosure filings and foreclosed homes last October is a good indicator that the real estate industry is slowly getting back on its feet. Levels dropped to its lowest since February. Credit this to the efforts posted by banks, lenders, non-profit organizations and government agencies who worked restlessly these previous months to help beleaguered homeowners avoid foreclosures.

Pre-foreclosure filings last October were 10% down from August levels and 7% down from September. These include notice of default and foreclosure auctions. With only 84,286 repossessed properties during this month, the level dropped dramatically by 22% since September. This trend is the same throughout half of American states according to the U.S Foreclosure index.

Although the current financial crisis have rolled across most of the U.S., pre-foreclosure filings and repossessed houses where mostly concentrated in certain states, cities and counties. These areas include Detroit which was hard-hit by recession and unemployment. The case is different with other states like California, Florida and Nevada which where victims of property speculation in prices and affordability.

The new President-elect has placed the current economic crisis at the top of his agenda when he takes charge in January. Included in this program is this lingering real estate crisis where Obama promised a 90-day moratorium on foreclosures. However, experts say that it will still be up to individual states to impose their own regulations.

While direct intervention by the government regarding foreclosures is still debatable, major banks and financial institutions have starting working out mortgage restructuring and putting monthly payments down to affordable levels. This means cutting down interest rates, extending loan terms, and reducing balances.

Although the last two months have shown good figures and great signs of recovery for the housing industry, work in this area still has a long way to go. Experts say that these figures may not yet be considered conclusive, although it shows sign that the nation is heading in the right direction.

As one of the largest states in the United States but with the lowest population, Wyoming registered a low foreclosure rate while surrounding states vary in impact from foreclosures. Nearby states like Montana and South Dakota registered some of the lowest foreclosure rates in the country, while Colorado and Utah absorbed the brunt of the foreclosures crisis and was included in the top ten highest states.