Posts Tagged ‘short sales’

Sigh….

FREDDIE MAC BETS AGAINST AMERICA

I have grown increasingly frustrated in fighting this battle because in many cases the fight is senseless. More often than not, a deal could be reached that would serve the best interests of the homeowner and……it would make the most business sense to the lender.  The problem is in many cases it’s not the lender that’s calling the shots, it’s the federal government and their absurd policies and programs.  Loans cannot be modified because of rigid HAMP guidelines.  Short sales cannot get approved because the FDIC’s loss share agreement is more profitable to the lender if they take a loss.  The lender will not waive deficiency against my judgment proof debtor because it’s Fannie/Freddie.

The record profits of the banks show they’ve figured out how to turn all of this to their advantage; not so the American people.  They’re stuck fighting their government and the absurd policies that are working to their detriment…..policies they paid for through hard earned tax dollars.  It’s the Golden Rule….

He who has the gold rules…..

Sponsored by The Stopa Law Firm, come join us

Saturday, November 20th beginning at 11:00 am for a

FREE FORECLOSURE SEMINAR
Open to the public, FREE ADMISSION
Tampa Convention Center, November 20, 2010 at 11:00am

We will discuss loan modifications, short sales,
strategic default, and other “hot button” issues
regarding foreclosure in Florida.

This seminar, rally, support group, strategic planning session is for YOU THE AMERICAN PEOPLE. The CITIZENS OF THE STATE OF FLORIDA and this whole country.  We want anyone who cares about this country and in particular those who are touched by the Fraudclosure Crisis (that’s all of us) to come and attend this seminar.

This is a grass roots, come as you are, bring your friends summit where your voice and your input is even more important than those of the organizers.  This country has a history and tradition of protest and dissent, but the American people have become far too passive in this Foreclosure War.  The banks, the institutions, the politicians and the judges have taken notice of this  and the lack of passion or protest from the American people has brought us where we are today.

YOU CAN CHANGE ALL OF THAT BY COMING OUT NEXT SATURDAY

THIS IS A DIRECT CHALLENGE TO ALL OF YOU OUT THERE.  CALL YOUR FRIENDS, CALL THE TEA PARTY, CALL THE REPUBLICAN AND DEMOCRATIC PARTY. ORGANIZE YOUR FRIENDS AND DRIVE TO MEET US.

STAND UP AND MAKE YOUR VOICES HEARD!

If You’re Struggling With a Foreclosure or Trying For a Mortgage Modification Consider This

The FDIC took over IndyMac in 2008 after a run on deposits led to the second-biggest failure of a federally insured bank in U.S. history. When no buyers emerged, the government had to manage IndyMac until the following March, when most of its operations were sold to the investor group that owns OneWest. They’re led by Steven Mnuchin, a former Goldman Sachs Group Inc. banker, with backing from J. Christopher Flowers’ private-equity firm, hedge-fund manager George Soros and a fund linked to Michael Dell, the founder of computer maker Dell Inc. (See Bloomberg Article here)

Here are some details of the transaction according to an FDIC fact sheet:

•  The FDIC, as Conservator for IndyMac FSB (“New IndyMac”), entered into a letter of intent to sell New IndyMac to IMB HoldCo LLC, a thrift holding company controlled by IMB Management Holdings LP, a limited partnership, for approximately $13.9 billion. IMB HoldCo is owned by a consortium of private equity investors led by Steven T. Mnuchin of Dune Capital Management LP.
•  Uninsured depositors will not be receiving an additional claims dividend at this time. (Sorry little people, you get hosed.)

•  New IndyMac consists of:
o  The retail bank headquartered in Pasadena, CA, with 33 branches located primarily in the Los Angeles MSA with approximately $6.5 billion in deposits;
o  A loan portfolio of $16 billion and a securities portfolio of $6.9 billion;
o  A servicing platform with mortgage servicing rights (“MSRs”) representing an unpaid principal balance of $157.7 billion; and
o  A reverse mortgage platform, Financial Freedom, with $1.5 billion of reverse mortgages and MSRs representing an unpaid principal balance of $20.2 billion.

So for a $13.9 Billion Dollar Price Tag, the fat cats got all those assets described above….sounds like one hell of a deal.  Now let’s look at the same FDIC fact sheet to see what ordinary Americans got out of the deal…

IndyMac Loan Modification Program
•  Mortgages Eligible for Modification
—  46,500
•  Total Modification Offers Mailed to date —  32,274
•  Total Completed Modifications (Verified Income) to date —  8,512
•  Total Additional Verbal Acceptances of Offers to date —  9,480

Not surprisingly, the Internet is alive with stories and accounts of consumers who get no satisfaction from OneWest/Indymac (Sample here).  But instead of focusing on the negative, let’s turn for a minute to see how our friends, the Fat Cats are making out on their Indymac/Onewest purchase.  The headline screams, SCREWJOB!

(See the LA Times Article here)

So if you’re a consumer trying to get a loan modification or short sale through Indymac/Onewest, too bad.  But if you’re one of the handful of private investors who got preferential treatment from the feds and then got the deal of the century on this purchase (comparing assets to purchase price), just party on!

For more information contact Matt Weidner at www.mattweidnerlaw.com

If a homeowner does not qualify for a home modification, the Home Affordable Foreclosure Alternatives may provide a new option, through a short sale or deed in lieu which will allow them to walk away from the mortgage pursuant to the programs guidelines.  Realtors who are pursuing short sales should know and understand this new program and its guidelines.

Short Sale Guidance

One of the most frustrating parts of a short sale transaction is the inability of the lender to timely accept or reject a short sale offer.  A homeowner submits an offer to purchase to the lender then the lender cannot determine whether they will accept the offer before the buyer gets frustrated and walks away.  Under the new program, the lender would be required to advise the homeowner, up front, what the minimum amount it would need to receive in order to accept the short sale.  Other key components of the program are as follows:

• A fixed termination date not less than 120 calendar days from the effective date of the SSA (“Effective Date”). The Effective Date must be stated in the SSA and is the date the SSA is mailed to the borrower.  The term of the SSA may be extended at the discretion of the servicer up to a total term of 12 months,  in accordance with the requirements of the investor.
• A requirement that the property be listed with a licensed real estate professional who is
• regularly doing business in the community where the property is located.
• Either a list price approved by the servicer or the acceptable sale proceeds, expressed as a net amount after subtracting allowable costs that the servicer will accept from the transaction.
• The amount of closing costs or other expenses the servicer will permit to be deducted from the gross sale proceeds expressed as a dollar amount, a percentage of the list price or a list by category of reasonable closing costs and other expenses that the servicer will permit to be deducted from the gross sale proceeds.
• The amount of the real estate commission that may be paid, not to exceed 6% of the contract sales price, and notification if any portion of the commission must be paid to a contractor of the servicer that has been retained to assist the  listing broker with the transaction.
• A statement by the borrower authorizing the servicer to communicate the borrower’s personal financial information to other parties (including Treasury and its agents) as necessary to complete the transaction.
• Cancellation and contingency clauses that must be included in listing and sale agreements notifying prospective purchasers that the sale is subject to approval by the servicer and/or
• Notice that the sale must represent an arm’s length transaction and that the purchaser may not sell the property within 90 calendar days of closing, including certification language regarding the arm’s length transaction that must be included in the sales contract.
• An agreement that upon successful closing of a short sale acceptable to the servicer, the borrower will be released from all liability for repayment of the first mortgage debt.
• An agreement that upon successful closing of a short sale acceptable  to the servicer the borrower will be entitled to a relocation incentive of $1,500, which will be deducted from the gross sale proceeds at closing.
• Notice that the servicer will allow a portion  of gross sale proceeds to be paid to subordinate lien holders in exchange for release and full satisfaction of their liens.
• Notice that a short sale may have income tax consequences and/or may have a derogatory impact on the borrower’s credit score and  a recommendation that the borrower seek professional advice regarding these matters.
• The amount of the monthly mortgage payment, if any, that the borrower will be required to pay during the term of the SSA, which amount must not exceed 31% of the borrower’s gross monthly income.
• An agreement that so long as the borrower performs in accordance with the terms of the SSA, the servicer will not complete a foreclosure sale.
• Terms under which the SSA can be terminated.

Ten Day Decision Period

Under the new program, a lender must approve or decline a short sale offer within ten days of receipt.

The preceeding are just the initial requirements of the program.  These requirements will change and they are not scheduled to take affect until April 10, 2010, but some servicers may be implementing them prior to that date.  For more information about the program, please contact Matt Weidner at www.mattweidnerlaw.com

Housing starts fell dramatically, after posting several months of slight increases or stabalization.  Meanwhile more Americans who bought homes during this brief increase are falling into trouble.  About 3.4% or 1.9 million homeowners are 120 days or more late on their payments, up 1.5% from last year.

• The total number of homes for sale was 3.63 million in September, down 15% from last year.
• During the peak, residential housing made up 6.35 of Gross Domestic Product, today it is 2.5%.
• The average price of a US home doubled between 2000 and 2006; since then the avergage has dropped 30%.
• Overall 12.4% of American households with mortgages were 30 days or more overdue or in foreclosure.