One BIG problem, in this kind of market, is IF you need to sell your present house – in order to buy your next one – how can that be coordinated?  If your house is in a different area – miles away – from the area you’ve targeted, I have a suggestion for you.

Sell your present house, for top dollar in today’s SELLER’S market, and pocket your equity, finding a short term rental for the next 6 months. ( And probably putting most of your “stuff” in storage.)  If you are presently far away, this can help you establish a new base camp, right in the middle of your target community, poised to pounce on any opportunity that pops up, in a preferred, non-contingent fashion.

If you don’t find something over the next few months, be aware that in the fall, when the majority of other buyers have already bought places, inventories USUALLY rise, with sellers who were late to the party, and whose houses are no longer getting snapped up in days.

That’s when you can swoop in – in the month or two before the Holidays – with fewer competing buyers, AND more competing sellers, and strike a good, non-contingent purchase.

IF, on the other hand, your old house is reasonably close to the area you’re targeting, consider pulling out a lot of equity – for your down payment to be – and look for a place to purchase, non-contingent, making your present house into a rental.

There are lots of possibilities, and a good, experienced agent will be able to help you sort them out, in a way that will make sense for you. In these parts, I am just that kind of agent, and would love to help you weigh your options.

April 13th, 2012, 9:35 am ·   by Jon Lansner, of the Orange County Register    Pin It

Mortgage delinquency rate to fall 20 percent in 2011

New data from HOPE NOW shows that the industry completed more than 1.5 million loan modifications for at-risk homeowners from January through October of this year. That translates to an average of 154,000 homeowners per month who have been able to remain in their homes with an affordable loan modification solution.

It’s a notable accomplishment, but the report makes it clear that there’s far more work to be done. HOPE NOWsays there are currently 3.4 million homeowners 60 or more days behind on their mortgage payments.

Is it better to rent a Coto de Caza home, or to buy one? The answer may not be as clear-cut as you think. In this balanced, 3-minute joint interview from NBC’s The Today Show, you’ll hear the case for both sides.

From the pro-renting part of the talk, there’s valid points about the economic impact of low credit scores and/or no cash for downpayment, and the ongoing, annual cost of home maintenance — estimated at 2% of a home’s value.  Plus, renters have the ability to “follow a job” to a new town or region whereas a homeowner may be restricted, somewhat.

From the pro-purchase part, however, there’s excellent points that were made, too:

• Mortgage rates are low and each 1% drop to rates equates to a 9% drop to home price
• Buyers can zero in on a particular area with particular schools or walkability, for example, better than renters
• A home can a piggybank over the long-term; a place for “forced savings” for families that want it

The segment then closes with 5 of the best cities in which to rent, and 5 of the best cities in which to buy.

Whether buying or renting, don’t try to go at it alone. There’s lot of resources online, and an email to a local real estate or mortgage pro can set you in the right direction.

The nation’s overall delinquency rate dropped to 9.85% in the second quarter, down from 10.06% of all loans outstanding three months earlier.

Even better, the percentage of seriously delinquent loans — ones 90+ days late or already repossessed by lenders — dropped to 9.11% from 9.54% in the first quarter.

The drop in loans 90 days or more late was the biggest the MBA has ever recorded, according to the MBA’s chief economist, Jay Brinkmann. “That shows we’re making headway,” he said.

He cited three reasons for the improvement:

• Fewer loans are coming into the default process;
• The homebuyers tax credit, which increased demand for homes, generated many pre-foreclosure sales, removing the attached delinquent loans from the statistics;
• The government- and lender-led mortgage modifications “cured” some payment problems.

However, even with those bright spots, there was one troubling finding: First-time delinquencies increased after four quarters of decline. It inched up to 3.51% in the second quarter from 3.45% in the first quarter. According to Brinkmann, the reversal reflects the weakness in both the housing market and the overall economy.

“It’s a question of jobs,” he said. “It takes a paycheck to make a mortgage payment.”

Underscoring the trend is the foreclosure trend among borrowers with conventional loans, like 30-year, fixed rate mortgages. They accounted for nearly 36% of foreclosure starts during the quarter. And these safe loans rarely get into trouble unless they lose employment or income.

The four worst hit states — California, Florida, Arizona and Nevada — still account for nearly 60% of national delinquencies, but California’s numbers dropped dramatically this year. At the end of 2009, California foreclosure starts made up nearly 20% of the nation’s total. That dropped to 14.7% during the second quarter.

Another positive trend is the gradual downturn in the number of borrowers who are underwater on their mortgages, owing more than their homes are worth. 

CoreLogic reported today that the rate of borrowers underwater dropped to 23% in the second quarter from 24% in the first.

When borrowers fall underwater, it increases the chance that they’ll lose the homes. Brinkmann calls it one of the two “triggers” that lead to foreclosure.

If homeowners have positive equity, they can use it as a source of cash to pay bills, including mortgages. But if their cash reserves are gone and they can’t afford to make payments because their income has dropped, foreclosure is almost inevitable.

CoreLogic found that negative equity is worst in five states: Nevada (68%), Arizona (50%), Florida (46%), Michigan (38%) and California (33%).

By Les Christie, staff writer, CNNMoney.com

In an exclusive interview with REO Insider, Vernon said the bank pre-screened these borrowers who have been considered for a modification under the Home Affordable Modification Program (HAMP) and a short sale under the Home Affordable Foreclosure Alternatives (HAFA) program. They have either fallen out of both programs or failed to qualify. 

“The big question we’re looking to answer is customer responsiveness,” Vernon said. “These are not customers who are seeking short sales but rather distressed customers who are on the road to foreclosure, and we want to provide them an alternative. Our goal is to provide a tailored program with incentives that are attractive to homeowners experiencing a true hardship.” 

Under this “test umbrella” for future programs, no new documents are needed from the seller since they already submitted their financial information to the bank. B of A is waiving deficiencies, or the difference between what the home sells for and how much is left on the mortgage. Vernon said his department will assign a short sale specialist to work with the real estate agent and the homeowner to market the property for 120 days. 

Letters have already gone out to the homeowners, and they have 120 days to list the property. Vernon said they are looking at a six month program. The bank will be working with the homeowners’ real estate agents, meaning the bank will not be selecting agents to work with the homeowners. 

Once sold, the former homeowner receives a $3,000 relocation fee, and the real estate agent gets a 6% commission. If it doesn’t sell, B of A will accept a deed-in-lieu of foreclosure in order to satisfy the mortgage. 

Vernon said the homeowners targeted are heavily concentrated in the sand states, California, Florida, Nevada and Arizona. 

“It’s a small test of customers who have been pre-screened,” Vernon said. “We’ve also worked with an investor to get their approval in the program before hand. This allows us to test and learn. Our hope and desire of this is that this pilot and others will help us design expansion of these programs in the future.” 

That investor held a stake in the original mortgage that is now in default. Lenders need approval from these investors for a short a sale to go through. It has been one of the major hurdles in the short sale process. 

The industry is beginning to recognize short sales as a serious alternative to foreclosure. According to the real estate data and service provider Core Logic, short sales in the US have tripled since 2008. Freddie Mac recently reported that its short sale figures were up 600% from two years ago and said in its Q210 financial statement that it completed 22,117 short sales in the first half of 2010, up nearly 180% from 7,914 in the first half of 2009. 

In Q210, B of A completed more than 25,000 short sales, almost three times the amount done in the same quarter last year. Roughly 90% of the short sales are performed on the Equator platform, and Vernon said by the end of the year, the entire short sale business will be. 

“Bank of America is committed to constantly improving the short sale process for our customers and our real estate business partners,” Vernon said. “We continue to test new ways of completing short sales to provide customers with a dignified exit and help avoid foreclosure.”

If you are approached by Bank of America for this program, please know that I have a long-term, successful relationship with them, in both distressed and non-distressed properties.  I am thoroughly qualified to be your chosen local Realtor, for this program.

As the economy continues to falter and the unemployment rate remains high many homeowners continue to struggle with their house payments. There are government mandates on banks to assist borrowers whenever possible. One such mandate is for banks to offer loan modifications allowing homeowners to remain in their homes and to help them avoid a short sale or foreclosure. 

Unfortunately, getting a loan modification can be a very time consuming and an arduous task for many homeowners seeking help. Massive delays, lost paperwork and redundant efforts can cause homeowners to give up and not succeed with their modification. However, for Bank of America customers in Southern California, there is now a better process in place. 

Bank of America has established a modification department in Brea, California. Any borrower whose loan is with Bank of America can now call in and have someone answer the phone, listen to their issues and instruct them as to the process in order to proceed to receive a modification. The borrower is instructed as to what documentation is needed and an appointment is set to meet face-to-face with a Bank of America representative within one week. The results have been extremely helpful. 

If you know of such an individual who needs help please instruct them to have their loan number ready when placing the call. The homeowner is the only person who may place the call. Please make a note of this phone number and feel free to furnish it to anyone who needs help. 714-987-5050.

Let me know if you need more information -  Call me at 949-643-2100, or shoot me an email at Bob@BobPhillips.net    I hope this is helpful to someone.