Bank repossessions, the final stage of the foreclosure process, fell 9 percent month-to-month and were down 35 percent from a year ago. Still the numbers are on pace for nearly a half a million properties to be repossessed in 2013. That’s an improvement, but still well above normal levels.

(Read More: Dire Predictions For Housing Recovery)

The picture is also mixed geographically – Arkansas (up 143 percent), Oklahoma (up 103 percent), Maryland (up 74 percent), Washington (up 71 percent), New Jersey (up 33 percent), and New York (up 21 percent) –as states that require a judge in the foreclosure process as well as those with new laws protecting borrowers, are seeing a spike in repossessions.

Article source: http://www.cnbc.com/id/100877414

Bank repossessions, the final stage of the foreclosure process, fell 9 percent month-to-month and were down 35 percent from a year ago. Still the numbers are on pace for nearly a half a million properties to be repossessed in 2013. That’s an improvement, but still well above normal levels.

(Read More: Dire Predictions For Housing Recovery)

The picture is also mixed geographically – Arkansas (up 143 percent), Oklahoma (up 103 percent), Maryland (up 74 percent), Washington (up 71 percent), New Jersey (up 33 percent), and New York (up 21 percent) –as states that require a judge in the foreclosure process as well as those with new laws protecting borrowers, are seeing a spike in repossessions.

“The increases in judicial foreclosure auctions demonstrate that these delayed foreclosure cases are now being moved more quickly through to foreclosure completion,” notes RealtyTrac’s Daren Blomquist in the report.

(Read More: Map: Tracking the US Real Estate Recovery)

“Given the rising home prices in most of these markets, it is an opportune time for lenders to dispose of these distressed properties, either at the foreclosure auction to a third-party buyer, or by repossessing the property at the auction and subsequently selling it as a bank-owned home.”

Judicial foreclosure auctions were up 34 percent from June of 2012, as Realtors report “brisk” sales of these distressed properties. Investors and regular buyers have been competing for a decreasing supply of properties. Nationwide, inventories of all homes are down dramatically, as a large number of underwater borrowers and borrowers with very little home equity are still unable to sell.

(Read More: Apartments Reap Rewards of Rising Rates)

Florida, Nevada, Illinois, Ohio and Georgia posted the top five state foreclosure rates for the first half of the year, according to RealtyTrac.

Article source: http://www.cnbc.com/id/100877414

“When we began the Independent Foreclosure Review, the OCC pledged to fix what was broken, identify who was harmed, and compensate them for that injury,” said Comptroller of the Currency Thomas Curry in a written statement. “While today’s announcement represents a significant change in direction, it meets those original objectives by ensuring that consumers are the ones who will benefit, and that they will benefit more quickly and in a more direct manner.”

The banks, including Bank of America, Citibank, JPMorgan Chase and Wells Fargo, will make $3.5 billion in direct payments to borrowers and $5.2 billion in other assistance, such as loan modifications and forgiveness of deficiency judgments. Four other banks, EverBank, Ally, HSBC and One West, were involved in the talks but did not sign the deal. Together they service close to half a million loans. The OCC says conversations with them continue.

All 3.8 million borrowers, designated as those who were in any stage of foreclosure in 2009 or 2010, will receive something, regardless if they were wronged in any way, according to federal regulators. The loan servicers will divide borrowers into eleven different categories, and the regulators will designate a standard payment for each category.

Bank of America’s share will be the largest at just under $3 billion in direct payments and borrower assistance. Bank of America took on the ills of Countrywide Financial.

“We support the new approach because it expands the number of borrowers who will receive payment, speeds the delivery of those payments, and will provide support for homeowners still struggling to make payments and encourages continued community stabilization efforts and recovery of the housing market,” said Bank of America spokesman Dan Frahm.

This settlement follows a $25 billion deal last year with many of the same mortgage servicers and state attorneys general. So far that has resulted in nearly $22 billion in consumer relief and $4.2 billion pending to 300,000 borrowers through the end of September, roughly $84,385 per homeowner. (Read More: Forty States Sign On to Foreclosure ‘Robo’ Settlement.)

Article source: http://www.cnbc.com/id/100359672

“About two weeks ago we started getting calls, like 7 or 8 a day, and we’ve been asked to bring students to work sites,” says Linda Thomas, an employment liaison for Job Corps. “They said look just bring them with their resumes, we’ve got work, we’re pushing more contracts now. Business is doing well, building is doing extremely well in the area.”

(Read More: Pending Home Sales Surge to Five Year Highh)

This is a drastic change from just six months ago, when Thomas was still finding herself the beggar, not the chooser with home builders. Her main concern is that all this new momentum will come to a grinding halt should the nation’s economy go over the so-called “fiscal cliff.”

“A contractor, once he sets up a job, then he has to get money for that job because he has to buy the materials and so forth, so if a bank is a little scary or his lender is a little scary, a private lender, he may not have the funds to start the project, therefore we won’t have the jobs.”

(Read More: Top Destination States for Jobs)

Article source: http://www.cnbc.com/id/100271485

Refinances are surging this year, not just because interest rates are hitting new record lows but because the government is making severely underwater loans eligible for refinance. (Read More: Is Housing Recovering as Much as Everyone Thinks?)

The Home Affordable Refinance Program, which involves loans backed by Fannie Mae and Freddie Mac, used to cap negative equity, but this year that cap was removed, putting thousands more loans into the refi machine. So far more than half a million loans were refinanced through HARP since the beginning of this year.

Politicians and housing advocates claim that all the savings from these record low interest rates and the ensuing refinances is going back into the economy, but that does not appear to be the case. (Read More: Fed Pulls Trigger, to Buy Mortgages in Effort to Lower Rates)

Given the research from Freddie Mac, a quick, non-scientific survey of small lenders and brokers, produced similar findings:

Craig Strent/Apex Home Loans, Maryland: Homeowners, particularly older ones that have already met their financial planning goals, are taking the savings and just putting it back in the loan, meaning they are lowering their rates, but continuing to pay the same amount on the new loan that they were paying on the previous loan. This accelerates their payoff and decreases the interest they pay, though arguably with an opportunity cost given how cheap the money is.

Dan Green/Waterstone Mortgage, Ohio: Not all households are choosing to reduce payments. Many are choosing to reduce term. At today’s rates, the first payment of a 15-year mortgage is comprised of 67 percent principal. To get that point on a 30-year mortgage would take 18 years. More homeowners are asking about amortization schedules, and the benefits of paying extra principal each month. There’s more talk of saving than spending.

Julian Hebron/RPM Mortgage, California: Refi to lower payment, but keep making previous payment to pay loan down faster. Example: If you use our average loan of $550,000 and super-conforming rates of 3.5 percent now vs. 4.5 percent a year ago, a borrower’s payment drops from $2,787 to $2,429 (this factors in the paydown of $550,000 to $541,000 over 12 months). If a borrower keeps making old payment on new loan, thereby paying loan down by an extra $358 per month, they cut 6 years (or 20 percent) off a 30-year term.

(Read More: Is Housing Risen From Ashes?)

Suffice it to say, when it comes to home equity, we have fast become the anti-ATM society, by will or by force (we don’t have a whole lot of home equity anymore).

After trillions of dollars in lost home equity, Americans now appear to want it back so badly that they’re willing to pay it in themselves. They also want less debt for a shorter period of time.

This sounds like responsible, conservative fiscal planning, but it also means that savings from rock-bottom interest rates do not get paid back into the economy the way so many politicians and analysts have suggested.

-By CNBC’s Diana Olick
@Diana_Olick

Questions? Comments?