This video answers the question why banks don’t want to foreclose...
http://www.youtube.com/user/fiercefreeleancer
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Molly Riley / REUTERS
Sales of new U.S. single-family homes rebounded in June from the prior month's record low.
msnbc.com staff and news service reports
updated
7/26/2010 2:52:14 PM ET
For those seeking hope in the better-than-expected 23.6 percent
jump in new home sales in June: it's only one month's data, it's from a
deep low in May, and the sales pace remains near the lowest since
records started being kept when John F. Kennedy occupied the White
House.
The housing market still faces an array of challenges, not least of
which is persistent joblessness with almost 15 million Americans out of
work. People remain reluctant to spend, despite record low interest rates, and banks remain reluctant to lend.
"From our perspective, with the unemployment rate still very high, a
lack of demand for mortgages and banks not willing to make significant
mortgage loans at this point, you are looking at a very moribund home
sales market. That is true whether you are looking at the new or
existing home sales space. We see it continuing to hover right here near
the lows," said Tom Porcelli, senior market economist at RBC Capital Markets.
The Commerce Department said Monday sales jumped 23.6 percent to a
330,000 unit annual rate from a downwardly revised 267,000 units in May.
The sales pace last month was the second lowest since records started
in 1963.
But the percentage increase was the largest rise since May 1980, and
partially unwound the prior month's historic 36.7 percent decline. And
the jump was better than expected. Analysts polled by Reuters had
forecast new home sales rising to a 320,000 unit pace last month from
May's previously reported 300,000 units.
"It was better than expected on the headline but you would be doing
yourself a disservice if you didn't notice that there was also a
significant downward revision to the prior month. So if you average the
last couple of months you are looking at a run rate of about 300,000,
which is basically near an all-time low," Porcelli said, warning people
not to get caught up in the headline.
"You have to look at the overall report, and what you notice from
that is there is not a lot of activity going on in the new homes sales
space," he said.
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23.50 acres with water rights
• lot / land - MLS® $450,000 - Lush, green grass
Foothill Area, Gardnerville - EXTRAORDINARY LAND FOR EXTRAORDINARY PEOPLE. Situated off Mottsville Road yet near the bottom of Kingsbury this is an exceptional piece of property with recession proof pricing., access to world class recreation at Lake Tahoe is a hop skip and a jump away. This land enjoys panoramic views in all directions and comes with surface water rights and a large irrigation water way (with fish). MLS: 90015896
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Foothill Area, Gardnerville - Announcing a price reduction on 1190 Mottsville Meadows, a lot / land. Now MLS® $450,000 - Lush, green grass.
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View, meadow, cul-de-sac
• lot / land "Sweeping Views of magnificent Job's Peak" - MLS® $199,000 - Sold Originally for $355K
Job's Peak Ranch, Foothill Area - AMAZING .. Job's Peak Ranch home site offered forthe "no excuse" price of $199,000. This lot sold for $355,000 in 2004. There is a paid water connection fee ($17,000) included. The views are no less than incredible. Enjoy meadow, trees, cul-de-sac and the privacy this gated community affords. Subject to short sale approval.
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Job's Peak Ranch, Foothill Area - Announcing a price reduction on 235 Job's Canyon Ct. Lot 410, a lot / land "Sweeping Views of magnificent Job's Peak". Now MLS® $199,000 - Sold Originally for $355K.
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RENO GAZETTE-JOURNAL
Sunday Business
Sunday, June 27, 2010
By Jason Hidalgo
jhildago@rgj.com
SELLERS BEWARE, short sales are on the rise in Northern Nevada, but many sellers
are unaware of the confusing array of recourse options lenders can
pursue following the closure of the transaction.
Lenders can demand remainder of original mortgage even after owner
short-sells or walks away from underwater home.
Christopher Torres' home woes started in 2008 following a divorce.
The loss of his ex-wife's income meant that Torres could no longer afford the $1,700 monthly payment for his mortgage. Compounding Torres' woes was the fact that the Reno home was purchased at the real estate bubble's peak. With his $250,000 home having lost $150,000 in value, selling the property wasn't an option.
After exhausting his options for a loan modification, Torres thought a short sale was the best course of action to minimize damage to his credit.
"I would've had to come up with that money up front if I sold the house," Torres said. "So I decided on a short sale instead. I thought it was the best-case scenario out of a bunch of bad options. I also felt that I had the responsibility to do something and not just walk away."
Torres said he hired a short sale specialist and completed the transaction earlier this year. At that point, he thought his problems with the lenders were over.
But the ink was barely dry on Torres' paperwork when he got a call from the second servicer on his mortgage. MInnesota-based Green Tree told Torres he still owed them the difference for the money they did not recoup from the short sale.
"They asked me for $40,000," Torres said. "I wasn't aware that they could still come after you after your short sale is finalized. I just felt betrayed and lied to. No one told me they could still do that."
Short sales are viewed as a less serious hit to credit than a foreclosure, and they are growing in popularity in Washoe County.
The number of short sales in the Reno-Sparks metro area jumped to 454 in the first quarter of 2010 compared to 147 during the same period last year, according to data from the Northern Nevada Regional MLS. Short sales also accounted for 32 percent of sales during the first three months of this year, up from 14 percent in the first quarter of 2009.
Nevada had the nation's highest rate of foreclosure-related filings for the 40th straight month in April, and so Torres has plenty of company across the Silver State.
But Nevadans might not be aware of rules that allow lenders to seek payment from homeowners who decide to short-sell or even walk away from their homes.
"In states such as California, lenders are told, 'You took the house as collateral and that's your sole recourse,'" said Ken Amundson, President of the Reno/Sparks Association of Realtors. "But Nevada is a deficiency state. So if there's a shortage of money to pay off a mortgage that goes into default, then the lender or owner of that note has a choice to come after the person to collect it."
The fact that some distressed homeowners are mistaking deficiency laws with current IRS exceptions only adds to the confusion, Amundson said. Typically the IRS taxes write-offs from short sales -- which is based on the difference between the remaining principal and what an upside down home actually sells for -- as extra income. But the IRS has waived that policy through the end of this year due to the large number of distressed properties that have entered the market after the real estate meltdown.
Deficiency laws can be difficult for the lay person to understand. Rules are different depending on whether a lender is the first or second mortgage holder and when a home either has a home equity line of credit or has been refinanced.
Making sense of lenders' collections policies also can be mind-boggling, even for the professionals that deal with them on a frequent basis, said Jennifer Capurro, a broker-realtor with RE/MAX realty Affiliates in Reno who regularly works on short sales.
Consumer Recourse
In 2009, 11,037 properties in Reno-Sparks received either a notice of default, trustee sale or foreclosure, according to national foreclosure tracker RealtyTrac. That's a rate of one in 16 properties -- nearly three times the average rate and 14th highest among more than 200 metro areas surveyed nationwide.
The greater Las Vegas area, which posted a foreclosure related activity rate of one in eight, took the top spot. An estimated 94,862 of its properties received a foreclosure-related notice last year.
With Nevada struggling under the brunt of distressed properties, the Nevada Legislation passed AB471, which took effect on October 1, 2009. The law was designed to protect homeowners from deficiency judgments when they opt for a short sale.
But AB471 comes with key caveats.
The biggest caveat is that the law is not retroactive. This essentially makes the law useless for homeowners who now need it most, said bankruptcy lawyer John White of White Law Chartered in Reno.
"It does not apply unless the mortgage was made after October 1, 2009," White said. "So it is no help."
Lenders, who lobbied against making the law retroactive, defended the decision.
"These mortgages were priced based on a certain set of expectations," said William Uffelman, president and chief executive officer of the Nevada Bankers Association. "You can't just have someone come in and change the rules after the fact."
Another caveat is that the law only applies to lenders who hold the first or primary mortgage on a home -- also known as "purchase money mortgage." That means the holder of a second mortgage is exempt and can pursue a deficiency for up to six years.
Even among first mortgage holders, there are exceptions.
The "no deficiency" provision only applies to first mortgage holders defined as "financial institutions" under Nevada Revised Statutes 363A. This means the law does not apply to lenders such as credit unions organized under the Federal Credit Union Act, and entities that Nevada isn't allowed to tax by law.
Mortgages that have been refinanced or have a home equity line of credit attached to them also doesn't get protection from deficiency judgments. Exempting borrowers who refinanced or took out a line of credit is necessary to make sure that borrowers don't get rewarded for risky behavior, said Assemblyman Marcus Conklin, D-Clark County, who spearheaded the bill.
"If you bought a home for $300,000 and took out a $200,000 home equity line of credit to buy a new car or boat or put it down as a down payment on a secondary property, then you won't get the same protection as someone who did everything the right way," Conklin said.
A legal minefield
Given all the legal pitfalls, anyone considering a short sale should get legal help, say housing industry insiders.
It's especially important to have lenders agree in writing that they won't be pursuing a deficiency judgment following a short sale. But experts familiar with such transactions acknowledge getting lenders to agree to such terms is easier said than done. This makes opting for a foreclosure the better choice in some cases -- even with the bigger hit on one's credit rating, said White, the bankruptcy lawyer.
"Unless the bank releases the homeowners from a deficiency, short sales are generally a bad idea," White said. "If the homeowner just lets the home foreclose, the bank has to sue for the deficiency within six months of the foreclosure sale. If, on the other hand, the homeowner does a short sale and agrees that the bank can still sue for the deficiency, the bank gets years to make up its mind."
Opting for a short sale also means that borrowers give up their right to state-mandated mediation, White added.
Another wrench for distressed homeowners involve the 2005 amendments by congress to eliminate "fresh-start" bankruptcy, White said.
"If the bank successfully overcomes the homeowner's defenses and gets a deficiency judgment, the homeowner has to live on a tax-cheat's budget and make payments to the bank in chapter 13 bankruptcy for, usually, five years," White said.
Such arrangements have advocates questioning the fairness of a system that bails out irresponsible lenders while making it harder for consumers to get out of their financial woes.
A new start
Despite the difficulties he went through, Torres doesn't have any bitterness toward the property he and his family called home for more than three years.
He has picked up the pieces of his life after the divorce. Torres' new wife is expecting a baby boy in October -- Torres' third child. He hopes the baby's arrival is a good omen, a sign of a new chapter in his life.
But as Torres gets ready to turn the page, he also wants to make sure he doesn't forget the lessons he learned from the past -- and make certain that he doesn't get into the sames tough situation again. Tired of the nightly collection calls and unable to pay the deficiency with Green Tree, Torres opted for bankruptcy.
"I really tried to do the right thing and not walk away," Torres said. "But it's like the lender didn't understand my situation. When I said I didn't have $40,000 or even $10,000, it just wasn't registering with them."
Requests for comment from Green Tree were not returned.
These days, Torres' priority is to make sure he can provide for his family and build up a nest egg. Although he won't be buying any big ticket items for the next few years, he says he has everything that he needs. Maybe someday, he might even give home ownership another shot.
"It'll' be a struggle for a while but my experience also taught me a lot of valuable lessons," Torres said.
-- end --
Pleasantview, Gardnerville - Announcing a price reduction on 916 Springfield, a 3,697 sq. ft., 3 bath, 3 bdrm single story. Now MLS® $499,950 - Price Reduction.
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Reno Gazette Journal - Friday, June 25, 2010
Alan Zibel
ASSOCIATED PRESS
WASHINGTON -- Mortgage gages are cheaper today than they've been in a half-century. If only most people had the job security, the credit score and the cash to qualify.
The average rate for a 30-year fixed loan sank to 4.69 percent this week, beating the low set in December and down from 4.75 percent last week, Freddi Mac said Thursday. Rates for 15-year and five-year mortgages also hit lows.
Rates are at their lowest since the mortgage company began keeping records in 1971. The last time they were any cheaper was the 1950's, when most long-term home loans lasted just 20 or 25 years.
Almost no one expects falling rates to energize the economy, though. Sales of new homes collapsed in may after an enticing tax credit expired.
"As long as prospective homebuyers are still concerned about their jobs and financial well-being, many will be reluctant to take the plunge, even though affordability has never been better," said Greg McBride, senior financial analyst with Bankrates.com.
Rates have fallen over the past two months as investors have become nervous about Europe's debt crisis and the global economy and have shifted money into safe Treasury bonds. The demand has caused Treasury yields to fall.
While morgages are getting cheaper, low interest rates hurt Americans who are trying to save. Puny rates for savings accounts and CD's especially are hard on people living on fixed incomes.
Americans normally rush to refinance when rates plummet. But refinancing activity now amounts to less than half the level of early 2009, when long-term rates hovered around 5 percent.
RATES FALLING
SINKING RATES: Rates on 30-year-fixed mortgages fell this week to an overage of 4.69 percent, the lowest since the mid 1950s.
BUT DO YOU QUALIFY?: To get a new mortgage or to refinance, you need steady income, excellent credit and home equity or enough cash for a down payment.
REFINANCING LAGS: Refinancing activity now amounts to less than half the level of early 2009, when long-term rates hovered around 5 percent. Many people who wanted to refinance -- and qualified -- already have done so.
Source: Associated Press
HOME BUYER TAX CREDIT EXTENSION, MYTH OR REALITY?
Article by: Sue Saunders, NVAR Legal Counsel
The proposed extension of the home buyer's tax credit is still not finalized. Only the first step has been completed. As of June 16, 2010, the United States Senate passed a bill extending the deadline for closing escrow on a home buyer's tax credit contract. The bill still needs to go to the House of Representatives and then to the President. So, the extension is not here yet, but we should know sometime this week.
The National Association of REALTORS® (NAR) estimates the number of home buyers who have qualified for the tax credit and met the contract deadline of April 30, but who would not be able to close their transaction by the June 30 deadline, could go as high as 180,000, Realtors® have reported as many as one-third of qualified applicants have been notified by lenders that their mortgages will not close before June 30 due to the sheer volume of applications in the pipeline.
"These are not buyers who just entered into the market. These are buyers who previously met all the qualifications for the tax credit, but find themselves at the mercy of a work-flow jam with the lenders or other delays and might not be able to complete the purchase of their homes," said NAR President Vicki Cox Golder. "It would be a tragedy for them not to be able to complete the purchase in time to claim the credit."
Golder said she also wanted to m ake this clear. "This amendment does not extend the deadline for home buyers to qualify for the tax credit; it extends the deadline for closing the transaction, from June 30 to Sept. 30. Since these applications were already in the pipeline and figured into the program's cost, the extension of the closing deadline should not incure any further government costs."
Keep watching the news. Remember this extension, if passed, will only extend the closing time for home buyers who have already qualified for the tax credit and met the contract deadline of April 30, but who have not yet closed.
Statements made by the NVAR Information Line arttorneys on the telephone, in e-mails, or in legal e-news articles are for informational purposes only. NVAR's staff attorneys provide general legal information, not legal representation or advice regarding your real estate related questions. No attorney client relationship is created by your use of the Legal Information Line and any information you receive. You should not act upon this information without seeking independent legal counsel. Information given over the Legal Information Line or in these articles is for your benefit only. Do not practice law! Inform your clients they must seek their own legal advice.
Attachment(s): Home_Buyer_article 6-22-10.pdf
Job's Peak Ranch, Foothill Area - Announcing a price reduction on 18.83 Nature's Edge Road, a lot / land "Mature Pine Trees-Views". Now MLS® $495,000 - Priced for quick sale...
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LOS ANGELES - The median home price in California last month surged 10.9 percent from May 2009 to $278,000, as investors of low-cost forewclosures dwindled and transactions in mid-range and high-end neighborhoods claimed a greater share of the sales.
Last month's median was up from $230,000 to $255,000 in April, San Diego-based MDA DataQuick said Tthursday. The May median, which marked a seventh consecutive month of year-over-year increases, was at its highestlevel since October 2008.
DataQuick President John Walsh said some of the higher-priced homes were reaching the market because of increasing economic troubles among middle and upper-class families, who are compelled to sell.
But he said low mortgage rates and the now-expiring federal tax credits for home buyers also had helped boost the proportion of more expensive homes with the sales mix.
Sales of homes costing $500,000 or more made up 21.2 percent of all transactions in the state last month, up from 16.5 percent a year ago.
The median home price in Northern California jumped 20.1 percent to $410,000 last month from $341,500 in April 2009. In Southern California, the median price surged 22.5 percent to $305,000, up from $249,000 in the year-ago period.
Source: Reno Gazette Journal, Friday, June 18th, 2010, Business Section page 10A
The Nevada Division of Forestry's BIG TREE PROGRAM recognizes Jobs Peak Ranch as the owner of the SUGAR PINE reported as the largest of its species growing in the State of Nevada and appearing in the BIG TREE REGISTER. Congrats again!
Attachment(s): Sugar Pine_Big Tree Recognition_6-16-10.pdf
NV Div of Forestry's BIG TREE PROGRAM recognizes both Cole Smith and Jobs Peak Ranch each as an owner of the MOUNTAIN ALDER reported as the largest species growing in the State of Nevada and appearing in the BIG TREE REGISTER.
Attachment(s): Mountain Alder_Big Tree Recognition_6-16-10.pdf