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Hey has anyone heard of Home 123? are they still around.. Or did Litton take them over?
From the FAR newsletter:
Fla. files lawsuits for foreclosure rescue fraud TALLAHASSEE, Fla. – May 3, 2011 – Florida Attorney General Pam Bondi’s office filed a lawsuit on Friday against three South Florida companies that allegedly charged upfront fees for loan modification services to homeowners facing foreclosure. Charging upfront fees is illegal under Florida Statute 501.1377.The three companies are: Home Owner Protection Economics Inc., DC Financial Group, and Deleverage America Inc. The company’s owners, Dennis Fischer and Christopher S. Godfrey, purportedly collected thousands of dollars monthly in upfront fees for loan modification services they never provided. READ THE REST
EXAMPLE
Investor buys a house for $350,000 in 2006. The tenant pays $1500 per month, the mortgage payments on $300,000 is $2,250 with tax and insurance.
The house is now worth $225,000. The investor loses his job. Tenant leaves and new tenant can only pay $1250. The investor can’t afford to pay $1,000 out of pocket each month, which is the difference between the rent and the mortgage.
The investor tries for a loan modification and is denied; he tries again and is denied several times before he gives up.
What does the investor do?
If the investor can show true hardship, he can either (1) use up all of his resources to keep the home; of (2) attempt to short sale the home.
Often investors will say, “I don’t want to lose the $50,000 I put into the property?” – they should consider the following.
No Short Sale: Starting $125,000 in the hole, the owner pays $1,000 a month for 5-10 years for the value comes back to 2006 level and owner’s equity to return. Investor will have to pay $24,000 or more to keep the place from going to foreclosure (assuming 2 years without rent increasing).
OR
Short Sale: Sell the property and start over. If the lender will agree to waive any deficiency liability, the investor can walk away from $125,000 in unsecured debt. Investor can clean up his credit and buy again in 2-3 years. Instead of investing $24,000 to keep the payments up, the investor can use that $24,000 to invest in a property and at year 3 has $24,000 in equity in a new property that is appreciating instead of still being more than $100,000 in the hole.
Please contact a NextGEN representative if you have any additional questions at 877.647.3911.
Complaining to the Treasury Department forces the bank to expedite your request for a loan mod because the Treasury Department can shut a bank down. Your bank can be fined and is quaking over the idea that US Treasury agents could set up camp inside the bank eyeballing their every move. For the banking community this is akin to a 9.5 earthquake on the San Andreas.
To fight the banks, preparation is crucial. File your complaint with the Office of the Comptroller, a subsidiary of the US Treasury. Within 48 hours the executive office of the bank will send your mod request directly to one of their finest escalation teams. You will get an almost immediate response.
To file, got to www.OCC.gov and on the home page click on Dispute Resolution on the right column, then click on Consumer Complaint and under Customer Assistance Group, click the Online Customer Complaint Form link and file your complaint. Then sit back and wait as tremors cause your bank to spring into emergency mode.
Wait 30 days after making your written request for a loan mod before you file the OCC complaint or the bank will say that you did not give them enough time to address your request.
OCC regulates all of the big National Banks. If your bank is not a National Bank, then it will be handled by the Office of Thrift Supervision at www.ots.treas.gov. The website has no online complaint form, so you will need to print, fill it out and fax or mail it.
This strategy is extraordinarily effective as the bank can be fined $10,000 for lack of response within 60 days. If the bank receives 10,000 complaints from the OCC at $10 grand apiece that is a loss of $1OO million dollars per year.
The little guy wields uncommon power now that you can create your own natural disaster for the banking industry.
I got an offer in January from an out of area Realtor on a duplex I had listed as a short sale. I thought this was kinda strange they never saw the property that I knew of. I figured maybe they where related to a tenant.
The beginning of April we had gotten approval. With no deficiency to sellers. My seller had been difficult to deal with from the beginning, getting info to submit price changes, signing the offer, ect.
The buyer/Realtor told me she was new to all this and she was very confused. She had been licensed since 2007 and I'm guessing not doing much in Real Estate. I asked if they would be doing an inspection of the property.
The week before closing I was still trying to get the lease agreements from the seller. During that time I had sent the buyer/Realtor an arms length affidavit. Two days later I was told the deal was off buyer/Realtor decided not to continue with the purchase. By this time I had been pulling my hair out of my head getting the seller to co-operate. One unit had no lease just month to month, I thought this was the reason for buyer was not going forward. Seller also stated no rent was received for April there was no security deposit and no last months rents paid for the unit with no lease.
I sent the buyer an email asking if they would reconsider if the tenant would sign a lease agreement. We then got notice they would close. So I asked if we where still on for inspections. I understood the buyers husband would be present and the hired inspector. The morning of inspections I spoke to the tenant to clarify he never paid Aprils rent, no security deposit and no last months pre paid he told me that was all untrue. Oh did I mention the buyers never showed for the inspection. I had the tenant write a statement of the facts. The other tenant made a comment that she thought the sellers mother was buying the place, my comment was I wasn't aware of that.
Meanwhile I thought these people where crazy this inspector has no clue of what be was doing. I had never met this guy so I thought he must have been from the area where the buyer/Realtor is from. Then again was that my business? The property was bringing in a 14% cap rate and I thought that's why they where wanting to purchase. This was Friday morning closing was for Monday afternoon.
That day (Friday) I got a fax from the seller stating she was as frustrated as I was and didn't appreciate my petty comments and I had a fiduciary to her. Note I'm a transaction broker. I didn't understand the comment of petty remarks. If begging and pledging to get the seller to co-operate is petty then OK. At this point I took all my info and her fax and sent it to our lawyer who was doing the closing and said until I hear back from you I will not respond to this seller.
Monday morning I find out from the attorney that the buyer/Realtor is the sellers aunt, the inspector was the sellers step father (not a home inspector) and the step father was purchasing this also because they had formed an LLC, that they wanted us to change names at closing to this LLC. The closing agent at this stage said she quits. At this point I could careless if it didn't close I felt total deceived by the buyer and seller. At this point there was no arms length affidavit from either party. Gee I wonder why?
The buyers husband shows up to closing acting as he knew nothing and brings a definition from some ask search, what the IRS claims is an arms length transaction is. Mean while he has the arms length affidavit with the signature of the Realtor on it. I take this and make a copy, then tell them I will NOT sign this. Then they tell me that I knew this all along supposedly the seller had told me this in February. If I had known do you honestly think I would have worked so hard to get no where?
I feel this Realtor/Buyer has major ethic issues and I would like to go forward with an ethics complaint would you?
Can a 1st lien holder require the seller to make a cash contribution? The 1st is with GMAC, the negotiator told us the seller had to contribute, they would not allow the buyer to contribute. Does anyone have a good contact at GMAC?
Bob Kelly 619-445-6556
Prudential California Realty
La Mesa, Ca.
Just curious how many have paid to be certified by Equator and, if so, has it been a benefit. All opinions are welcome.... Thanks! Jane
First, let's define what Mortgage Insurance is. There are 2 kinds of Private Mortgage Insurance (MI).
- BPMI. Borrower Paid Private Mortgage Insurance
- LPMI. Lender Paid Private Mortgage Insurance
MI coverage can be for 20% or more of the initial loan amount. MI offsets the loss incurred by the Lender/Investor when a mortgage loan defaults.
For example: Mr Smith (Borrower) purchased a property for $200,000 in 2004 and put 20% down. His mortgage was for $160,000. Federal Trust Bank (Investor) bought the loan from Wells Fargo (Lender/Servicer) and decided to protect their investment by purchasing MI for 32% of the loan amount. So Wells Fargo buys an insurance policy (LPMI) from Genworth Mortgage Insurance Company. As part of this insurance agreement Wells Fargo gives Genworth the authority (delegates) to decide whether a defaulted loan is foreclosed on or a Short Sale is accepted.
In 2010 Mr Smith goes into loan default and attempts to do a Short Sale. Even though the Investor, Federal Trust Bank, now owns the loan, Mr Smith still makes payments to his "Lender" Wells Fargo. His REALTOR(R) finds a buyer and submits the Short Sale request to Wells Fargo. Wells Fargo submits the request to Federal Trust Bank. Federal Trust Bank has to submit the Short Sale to the MI Company, Genworth, who has the final authority.
Remember the Mortgage Insurance Company is paying out on the amount of the loan NOT the value of the property.
Let's assume that Mr Smith's property is now worth 50% of what he paid in 2004. Just for reference, in my market of Poinciana Florida, the value would have declined about 80% during this period. 50% is being conservative in the hardest hit areas. Anyway......
The initial loan was for $160,000. 32% is guaranteed by Genworth. That's $51,200. The insurance payout is $51,200 whether foreclosure, Short Sale or Deed in Lieu.
The Short Sale request is for $90,000. This amount is the purchase price of $100,000 (Fair Market Value) minus 10% in selling costs.
In this scenario the Investor will get $90,000 + $51,200 = $141,200. Plus any incentives like HAFA. ***By the way, interest on a 30 year loan at 6.5% for the first 5 years is over $60,000!!! So the Investor will actually MAKE money on this Short Sale.
The Lender/Servicer, Wells Fargo, also made money. They made money when they initiated the loan. When they sold the loan. And when they serviced the loan.
The loser is the Mortgage Insurance Company. They are being asked to pay out $51,200. To offset this they may very well ask Mr Smith to make a cash contribution and/or sign a promissory note. If he refuses then MI may choose to offset their loss by allowing the property to go to foreclosure. MI can then pay out the same $51,200 in the future using future money. This is the time value of money.
In this Short Sale example the only entitty that lost money is the MI Company!!!
The lesson here is: When the MI Company requests a cash contribution and/or a promissory note the Borrower will more than likely have to pay something or the Short Sale will be denied. Get it?
From January to February prices fell 1.6 percent on a seasonally adjusted basis, according to the monthly House Price Index published by the Federal Housing Finance Agency. The previously reported 0.3 percent decrease in January was revised to a 1.0 percent decrease. For the 12 months ending in February, U.S. prices fell 5.7 percent. The U.S. index is 18.6 percent below its April 2007 peak and roughly the same as the February 2004 index level.
The FHFA monthly index is calculated using purchase prices of houses backing mortgages that have been sold to or guaranteed by Fannie Mae or Freddie Mac. For the nine Census Divisions, seasonally adjusted monthly price changes from January to February ranged from -3.7 percent in the Mountain Division to -0.6 percent in the East South Central Division.
Craig Roberts, President of Pennsylvania First Settlement Services LP, is a Certified Land Title Professional (CLTP), past-President of the Pennsylvania Land Title Association, and is a licensed title agent and real estate broker in the Commonwealth of Pennsylvania.
Pennsylvania First Settlement Services is a full-service title insurance agency serving the greater Pocono area of northeastern Pennsylvania. Its services include title searches, title insurance, real estate settlements, foreclosure research, documents services and short sale assistance. www.pafirstsettlement.com
SHORT SALE SUPPORT: Resources
Information & Reports
Mortgage Servicer Loss Mitigation Contact List
Housing Scorecard – HUD/US Treasury
Guides & Tips
PA 1st – Short Sale Assist – Required Information
10 Tips to a Successful Short Sale – Bank of America
Equator Guide: Mastering the Short Sale Processing System – Bank of America
Short Sale Quick Reference Guide – Bank of America
Traditional Short Sale Guide for Agents – Bank of America
What to Do Once You Receive a Short Sale Offer – Bank of America
Links
Bank of America – Agent Short Sale Support
Chase – Agent Short Sale Support
Foreclosure Statistics – RealtyTrac
HAFA Information – HAMP Government site
Servicers Contact List (HAMP-participating Servicers)
Articles
Equator Short Sale Tips & Best Practices by Kevin L. Kauffman – ActiveRain
Selling Underwater by Craig Roberts: Part 1 – HAFA Part 2 – HAFA Nuts & Bolts
Webinars
Freddie Mac Short Sales Webinar (Sept. 2010)
Freddie Mac HAFA Shorts Sales (Sept. 2010)
HAFA: Fannie Mae, Freddie Mac Short-Sale Rules. Download Slides (PDF: 588K) (July 29, 2010)
Understanding HAFA: Home Affordable Foreclosure Alternatives Program. Download Updated Slides (PDF: 267K) (Apr. 2, 2010 - NAR)
President’s Podcast: Short Sales Strategies (Oct. 6, 2009 – NAR)
President’s Podcast: Urging REALTORS® to Get “Schooled” (Sept. 1, 2009 – NAR)
Finding Income in a Tough Market Webinar (NAR)
Finding Income in a Tough Market Webinar, Part 2 (NAR)
Videos
Sessions from NAR 2010 Annual Conference & Expo, New Orleans, LA:
Short Sales: Is HAFA the Answer?
Navigating the Short Sale Landscape
Note: Links open to a promo feature. Select video from right-hand sidebar menu.
Visit us at www.pafirstsettlement.com
Updated 4-19-11
On this particular property I have been through 2 different Buyers and 4 appraisals, 2 by the lender. I know for a fact that all 4 came in around the same price. There is a 2nd and a 3rd which have been negotiated and approved. The Buyer is willing to contribute to the balance of the 2nd and the 3rd so there will be no deficiency notes. After we did everything that PNC Mtg requested from the "investor" BoA they came back to say they would rather go to foreclosure. Under the new law don't they have to accept a 100% plus offer on the appraised value. We did not ask for .88% even. I believe that they "investor" can not produce the note and the mortgage to show clear chain of Title. Who can I contact?
Can anyone give me an idea if you have had experience with Wells about how to negotiate deficiency judgment off in short sale. Also, how to structure re-payment schedule on this
Lien removed. First the lien and deficiency taken care of.
Second scenario: $60k loan
Sometimes I really wonder if people, no matter how hard I stress the importance of submitting supplemental documentation in a timely manner, really see the urgency in the situation.
Day 1 of request: Hi, Mr. Seller The bank is requesting this form to be filled out and they need it back in 4 days.
Day 2, Hi Mr. Seller Have you filled out that form for your lender? Could you send it back to me ASAP
Day 3, Mr. Seller it is imperative to get that form back to your lender tomorrow. They need it to process the short sale.
Day 4, Mr. Seller If you do not fill out that form and return it to me today, the lender is reserving its right to proceed with a deficiency judgement.
Let's just see if the Day 4 conversation does anything!!!!
Bobbie Files, C.D.P.E.
Certified Distressed Property Expert
Your Bristol and Plymouth County Realtor
508-238-5000 x.296 Office
508-521-9480 Direct / SMS
888-570-9907 Toll Free Direct Fax
bobbiefiles@kw.com Email
Visit my website at www.BerkleyMass.com
Visit my YouTube Channel at https://www.youtube.com/user/bobbiefiles
Join My Facebook Communityhttp://www.facebook.com/bobbiefiles.realtor
Search for Berkley Ma Homes at: http://BerkleyHomes.BerkleyMass.com
Search for Taunton Ma Homes at:http://TauntonHomes.BerkleyMass.com
For those struggling to pay your mortgage payments please visit:http://shortsales.berkleymass.com
Chase just approved this Destin Florida townhome for short sale. The process was a challenge. There were past due association fees and a judgment recorded in Walton County. In Florida, a property cannot be sold unless liens and judgments are paid or "released" at closing. Here is how we tackled the short sale:
1. Chase. The Chase part of the short sale was pretty straightforward. The negotiator was difficult to reach, and I attempted calling her several times over the course of a few weeks. When I finally spoke with her, she told me her files had doubled in the last two months and Chase was behind processing their short sales. The best way to reach her was by fax. After making contact, Chase approved the file fairly quickly. It pays to be pleasant on the phone, by the way!
2. The Judgment. In order to close on the Destin Florida short sale, the title agent needed a partial release from the creditor. The creditor agreed to the release in exchange for a small cash contribution from the seller.
3. The Homeowner's Association. There were about $16,000 in past dues owed. Chase would pay half. Would the association agree to settle for less? I asked the seller to contact the association directly and mention Florida Statute 720.3085. It stipulates:
Notwithstanding anything to the contrary contained in this section, the liability of a first mortgagee, or its successor or assignee as a subsequent holder of the first mortgage who acquires title to a parcel by foreclosure or by deed in lieu of foreclosure for the unpaid assessments that became due before the mortgagee's acquisition of title, shall be the lesser of:
1. The parcel's unpaid common expenses and regular periodic or special assessments that accrued or came due during the 12 months immediately preceding the acquisition of title and for which payment in full has not been received by the association; or
2. One percent of the original mortgage debt.
Given that $8000 was more than a year back dues, I thought the association would be delighted to "settle" and get a new paying owner. They were.
If you are contemplating a Destin Florida short sale to avoid foreclosure, be sure to contact an attorney and an experienced Destin Florida short sale agent.
It's Wendy!
Wendy Rulnick, Broker, Rulnick Realty, Inc.
Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or local 850-650-7883 ext 204
Email Wendy: itswendy@rulnickrealty.com
Destin Short Sales & Pre Foreclosure Help.
Read Wendy's Destin Real Estate Blog
Wendy is a short sale and pre-foreclosure specialist and has been featured in "Kiplinger Personal Finance Magazine" and "Florida Realtor Magazine". Call Wendy Rulnick, Broker/Owner, to list and sell your home or condo on the Emerald Coast of Florida in Walton, Okaloosa and Santa Rosa County- Destin, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Crestview, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field.
IMPORTANT NOTICE: Rulnick Realty, Inc. is not associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan. If you stop paying your mortgage, you could lose your home and damage your credit.
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