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Archive for November, 2010

Wells Fargo Clarifies Short Sale Criteria for Foreclosure Postponement

Tuesday, November 23rd, 2010

By: Carrie Bay

The National Association of Realtors (NAR) issued a notice this week explaining Wells Fargo’s new rules surrounding short sale transactions when a foreclosure is pending.

Earlier this month, Wells Fargo advised NAR that it has modified its existing guidelines to allow the postponement of a scheduled foreclosure in connection with a short sale, but only in limited situations.

NAR explained that for loans owned by Wells Fargo, including those inherited with the bank’s Wachovia acquisition, as well as other loans serviced by Wells Fargo but owned by an investor, the policy allows for one fore-closure postponement, but only if: (1) Wells Fargo has a short sale sales contract in hand that has been approved (including approvals from junior lien holders and mortgage insurers, if applicable), (2) the buyer has proof of funds or financing approved, and (3) the short sale can close within 30 days of the scheduled foreclosure sale.

However, Wells Fargo noted that not all investors allow for such postponements and stressed that in jurisdictions where the courts will not approve the delay, the postponement policy will not apply. Wells Fargo told NAR that it is willing to address situations that do not qualify under these guidelines on a case-by-case basis.

Last month, it was reported that Wells Fargo had stopped delaying foreclosures in order to give distressed homeowners time to complete short sales. But as NAR outlined, the foreclosure timeline can be pushed back for a short sale as long as Wells Fargo’s specified criteria are met.

NAR has been holding meetings with the nation’s four largest lenders, including Wells Fargo, to address concerns about their processes for short sales and REO disposition. The trade group’s talks with the banks are ongoing, but NAR has indicated that the discussions have been productive in fostering mutual success and support for a market recovery.

Clouds hang over Arizona home market forecast

Friday, November 12th, 2010

Phoenix Business Journal – by Jan Buchholz

The Arizona Regional Multiple Listing Service Inc. released its Pending Price Index, which uses the pending prices of homes under contract in the system to forecast average and median sales prices for the upcoming four months. The conclusion is that the Phoenix market still may not have hit bottom.

“Casting about in MLS data for signs of a market bottom and subsequent recovery has proved elusive over 2009 and 2010,” the report concludes. “The one-step-forward-two-steps-back phenomenon has become all too familiar in our fragile recovery.”

Here’s a few specifics:

  • The PPI predicts that the median sales price of a home in November will be about $120,000, relatively unchanged from October. The median is expected to drop in December to $117,000, rise in January back to $120,000 and then drop once again in February fairly dramatically to $105,000.
  • Average sales prices are projected to rise slightly in December but to fall in both January and February. The estimate is for the average price to be about $161,200 in November and drop to $145,800 in February.
  • October sales dropped nearly 19 percent compared to sales in October 2009.
  • New inventory declined in October, but total inventory increased to 45,252 listings. That’s a 15 percent increase in total inventory from October 2009.
  • October listings represent nearly seven months of supply making this a buyer’s market. A seller’s market is a four to five month supply.
  • Pending foreclosures have been trending downward slightly for the past 12 months and stood at 41,203 in October.
  • Lender owned sales dropped slightly from September to October, but represented a larger percentage of total sales.
  • Distressed sales, short sales and lender owned sales, peaked in September representing 74 percent of total transactions. In October distressed sales represented 65 percent of the total. It is unknown how foreclosure moratoriums by some lenders will affect this number in the future.
  • Though homes are increasingly affordable and interest rates are at historical lows, there still are not enough buyers to create a recovery market. Job growth, unemployment rates and migration are the key factors that will impact the residential housing market. Without positive trends in those three matrixes, no significant housing recovery is predicted in the short term. However, there have been modest indicators in recent months that those factors are improving.

Read more: Clouds hang over Arizona home market forecast | Phoenix Business Journal

Slide in Home Prices Signals Trouble Ahead: IAS

Thursday, November 11th, 2010

By: Carrie Bay

Residential property values fell 0.2 percent at the national level during the third quarter of this year, according to Integrated Asset Services (IAS). In front of a seasonal slow-down in home sales, IAS says the data foreshadow “particularly difficult times ahead” for the country’s housing markets and for the U.S. economy overall.

The IAS360 House Price Index released Tuesday shows that only the Northeast region of the country reported positive movement for the quarter, with home prices up 1.6 percent. IAS says the increase there was mostly due to isolated gains in New York and Washington, D.C.

In the Midwest, home prices plunged 1.4 percent. The West, despite occasional pickups in California, saw prices drop 0.5 percent in Q3, while the index for the South fell 0.4 percent.

IAS360 HPI data show the West, which in addition to California includes the nation’s hardest-hit metro area of Las Vegas, is now down 27.6 percent from its peak. According to IAS, the West is “far and away the poorest performing census region in the country.”

The IAS report also confirms that the nation’s most devastated counties, several of which have seen home prices fall by more than 50 percent over the last three years, are showing no signs of bottoming.

Among the worst, Monterey County in California, now down 41 percent over just the last year, fell another 3.8 percent in Q3. Lee County in Florida is off some 39 percent since the third quarter of 2009, and home prices there dropped another 4.3 percent in IAS’ latest report.

“Our granular data have been telling us all along that the housing crisis is not over,” said Ryan Tomazin, president of the Denver-based Integrated Asset Services. “The worst may be behind us, but I have to think this combination of slowing home sales in the middle of a generally weak economy will make it very difficult for the market to recover any time soon.”

On top of the effects of adverse market dynamics, investigations into the so-called robo-signing controversy initiated by federal officials as well as state attorneys general are casting another cloud over the housing market.

There are concerns that these investigations could slow the housing market correction as banks hold back foreclosures. IAS says fewer foreclosures mean the supply of those homes for sale goes down and investors will be more reluctant to buy them.

Top U.S. officials, meanwhile, including the head of the FDIC, are openly acknowledging the damage the recent problems with foreclosure paperwork could unleash on the country’s housing market and on its banking system.

There are outward fears that mortgage lenders will face even greater losses if servicers’ documentation errors and foreclosure suspensions cause the backlog of distressed properties to swell further, putting even more downward pressure on home prices.

Industry estimates of homes currently in near-term danger of foreclosure range between three and 11 million properties. Nearly a million homes are expected to be re-possessed this year.

“It’s clear the housing market still faces many problems, not least of which the potentially disastrous number of foreclosures that may occur over the coming years,” Tomazin said. “For any number of reasons, the housing market is very fragile to say the least.”

JPMorgan Chase to Restart Suspended Foreclosures

Thursday, November 4th, 2010

by Carrie Bay

JPMorgan Chase will begin re-filing affidavits later this month for some 127,000 foreclosures that have been on hold because of “robo-signing” issues.

Charlie Scharf, head of the bank’s retail financial services unit, told a group of analysts and investors at a conference in Boston Thursday that the company will begin resubmitting affidavits in these cases within “the next couple of weeks.”

JPMorgan stopped foreclosure proceedings in 40 states on roughly 127,000 loans in early October – 38,000 of which are in non-judicial states. Evictions of an additional 8,200 occupied REOs were also stopped.

Scharf says his company risks losing a couple million dollars each month the foreclosure proceedings are delayed. The re-filings should begin by mid-November and will take at least three to four months to complete, according to Scharf.

Bank of America says it has begun resubmission of 102,000 cases affected by procedural errors. GMAC Mortgage has re-filed 9,523 affidavits with the courts, and is in the process of reviewing another 15,500.

Scharf says JPMorgan’s reviews have identified two fundamental problems in its foreclosure process: affidavits were approved and recorded without the signer having personal knowledge of all information in the filing, and documents were notarized without being properly witnessed.

 In his presentation, Scharf attempted to dispel what he said were common misconceptions about the affidavit issues. He stressed that borrowers who are current have not been foreclosed on and that all of the company’s foreclosure decisions are “based on materially accurate information” that calls for repossession of the property.

JPMorgan has multiple checks and controls in place throughout the foreclosure process to confirm sufficient contact and modification efforts have been made and foreclosure decisions are appropriate, according to Scharf.

He also assured analysts and investors that all liens and records of ownership have been properly transferred.

Another myth, according to Scharf, is that foreclosures are being pursued too aggressively – he says they’re not. On average, homeowners have not made a mortgage payment in over 14 months at the time of foreclosure.

Some have argued that servicers aren’t able to cope with the high volumes of defaults – Scharf says his company can handle the workload.

 Scharf noted in his presentation that JPMorgan currently has over 17,000 default employees with almost 13,000 involved in loss mitigation efforts. He added that staff members that are independent of the operational process are responsible for checking the loan status at least twice, once before a loan is referred to foreclosure and once before foreclosure sale.

The Matheson Team and Scottsdale Law Group Unite to Help Arizona Clients with Short Sale Process

Tuesday, November 2nd, 2010

FOR IMMEDIATE RELEASE

Contact: Rachel Wilson, Media Relations

Phoenix, Ariz. (November 2, 2010)- The Matheson Team, a team of experienced realtors with expertise in foreclosures, and Scottsdale Law Group recently announced it has teamed up to help clients with short sale transactions. The companies will work simultaneously to assist clients undergoing a short sale with all real estate and legal needs, providing them with complete guidance throughout the process.

“There is so much liability involved that it serves the client well. I look forward to working with Scottsdale Law Group to assist our clients in determining the best course of action for their specific circumstances.” said Don Matheson, founder of The Matheson Team.

The process starts with a Matheson Team short sale client who will see a Scottsdale Law Group attorney for a consultation to discuss the process. If the client decides to engage, Scottsdale Law Group then gathers all supporting documentation for the lender. During this, The Matheson Team agent works to list and secure a buyer for the property. The Matheson Team then sends the contract to Scottsdale Law Group who will provide the proper documentation to the lender and work to achieve a positive outcome for the client.

“We understand the stress associated with short sale transactions and we work diligently to relieve these onerous burdens from our clients.  We are excited to be partnering with Don and the rest of The Matheson Team to assist our mutual clients during these difficult times of uncertainty.” said Patrick Keery, executive director of Scottsdale Law Group.

About Scottsdale Law Group:

Scottsdale Law Group is a law firm that brings together both legal and experienced transactional professionals to focus on legal matters associated with widespread real estate negative equity, government sponsored residential loan programs, property short sales, and bankruptcy protection. It is an industry leader in successfully processing, managing and achieving settlement offers with lenders and short sale transactions. To learn more about Scottsdale Law Group and the services it provides, please visit www.scottsdalelawgroup.com.

About The Matheson Team:

Founded in 1999, The Matheson Team is composed of full-service real estate agents with extensive knowledge of foreclosed properties and short sales in Phoenix and its surrounding areas.  It is the number one Re/Max team in Arizona and the number five team nationally with over 400 closed sales in 2010 thus far.  For more information about The Matheson Team and its services, please visit www.4closedphx.com, www.scottsdalerealestate.com and www.azgolfhomes.com.