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Mortgage alert: Borrowers change how they cheat

Thu, 26 Sep 2013 08:05:55 +0000

The good news: Fewer borrowers are lying on their mortgage applications. The bad news: The remaining cheaters may be pulling a more dangerous scam. Instead of inflating their home prices, they are now inflating their incomes and assets, according to researchers at CoreLogic.

“There’s no need to inflate the value of the home because home prices are rising,” said CoreLogic’s chief economist Mark Fleming.

But new federal regulations forcing lenders to prove that borrowers can repay their loans has some borrowers shifting the focus of their fraud to their personal balance sheets. Lenders are now scouring financial records, unlike during the recent housing boom, in order to make sure they are complying with new rules, so fraudsters are following suit, jacking up the numbers.

(Read more: Forget easing prices, new homes are up, up, up)

That could be more dangerous to the banks, because jacking up a home price only hurts if the home price falls, but inflating income means the borrowers may not be able to pay the loan no matter what.

Article source: http://www.cnbc.com/id/101062232

Mortgage delinquencies take a sharp turn up

Thu, 25 Jul 2013 21:42:38 +0000

The Home Affordable Modification Program has helped 865,100 homeowners avoid foreclosure, but more than 306,000 could not keep up with even the modified monthly payments, according to the Special Inspector General for the Troubled Asset Relief Program. The program does not force banks to write down mortgage principal.

Overall mortgage delinquencies are still down 6.5 percent from a year ago, according to Lender Processing Services. Some of the spike may be attributed to “a seasonal phenomenon,” according to LPS analysts, but this particular spike is larger than usual. Delinquencies ticked up just 3.4 percent in June 2012. The rise also spanned products and regions.

(Read more: Investors are moving out of housing)

Despite receding from the high levels during the housing crash, 4.8 million loans are delinquent or in foreclosure, according to LPS.

The states with the highest percentage of noncurrent loans are Florida, Mississippi, New Jersey, New York and Maine.

Article source: http://www.cnbc.com/id/100914292

Home builders boost prices amid rising rates

Thu, 25 Jul 2013 03:40:36 +0000

Mortgage rates jumped over a full percentage point from May through June of this year, robbing home buyers of much-needed purchasing power. While they have now settled back a bit, they are far from the record lows of the past two years.

“The recent increase in mortgage rates hasn’t slowed demand, as long as home affordability remains high,” noted Bob Walters, chief economist at Quicken Loans. “We are, however, seeing an increased urgency from potential new home buyers as they move to secure today’s historically low rates.”

New home sales jumped more than 8 percent month-to-month in June, but May’s sales numbers were revised sharply lower, and prices, while up from a year ago, are down 11.5 percent from April. That has some housing skeptics less optimistic about the builders’ prospects.

(Read more: Map: Tracking the US real estate recovery)

“Remember, last month on the ‘strong’ but FAKE new home sales print of 476k, home builders rallied, and every bull took a huge victory lap. Today we learned that was all garbage,” noted California-based analyst Mark Hanson. “Bottom line: May was a huge miss. Prices have tumbled as rates surged. And June is suspect because of the huge lower May revision.”

Article source: http://www.cnbc.com/id/100910336

Mortgage Recovery Still Rocky

Sat, 22 Dec 2012 06:05:44 +0000

The trouble is, the banks are close to finishing their obligations under the settlement, and the largest, Bank of America, will not continue to offer principal reduction afterward.

“The programs then going forward will provide for similar relief, but I think we have offered principal reduction to all our borrowers — all the people we own, the asset that we can actually offer to that’s been done,” said Bank of America CEO Brian Moynihan in an interview last week.

Another report Friday from Lender Processing Services showed a monthly increase in the U.S. loan delinquency rate in November. As it stands now, 7.12 percent of loans are 30-plus days past due, but not yet in foreclosure, and 3.51 percent are in the foreclosure process. Add it up and 5.35 million loans are still in some kind of trouble, according to LPS, as big banks finish their obligations under the settlement.

—By CNBC’s Diana Olick; Follow her on Twitter @Diana_Olick or on Facebook at facebook.com/DianaOlickCNBC

Questions? Comments? RealtyCheck@cnbc.com

Article source: http://www.cnbc.com/id/100335126

Bank of America Slashes $4.75 Billion Off Mortgages

Thu, 15 Nov 2012 08:44:31 +0000

As part of the sweeping national mortgage servicing settlement that went into effect in March, officials at Bank of America said they are halfway to fulfilling their mandate of providing $7.6 billion worth of consumer relief.

The bank
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], which took on the burden of Countrywide Financial’s mortgage ills when it bought the company, has completed or approved a total of $15.8 billion in consumer relief for about 164,000 homeowners as of Sept. 30 and is on track, according to officials, to meet its total financial obligations within the first year of the three-year agreement. (Read More: How ‘Fiscal Cliff’ Could Affect Mortgage Interest Deductions.)

The settlement, which was supposed to right the wrongs of so-called “robo-signing” and other fraudulent mortgage servicing activities, credits banks for principal reduction, short sales, and other consumer relief, but the credits are not dollar for dollar. That’s why Bank of America’s $15.8 billion in relief so far is only half-way to its required $7.6 billion under the settlement.

According to officials on a conference call with reporters, Bank of America has approved or completed first-lien modifications for 30,000 customers, providing $4.75 billion in principal reduction.

In addition, 45,000 customers got home equity loan relief, totaling $2.5 billion. Finally, more than 62,000 customers completed qualifying short sales or deeds-in-lieu of foreclosure, which adds up to $7.4 billion in relief from unpaid principal balances on the loans. (Read More: Foreclosure Discounts Drying Up.)

Borrowers received an average $150,000 reduction in their first lien loan balances, resulting in a 35 percent reduction in monthly mortgage payments, according to bank officials. On second liens, the average relief through loan extinguishment to about 43,000 customers is more than $56,000 per borrower.

While officials would not give an exact amount, they estimated that 60 percent of the loans that received principal reduction were owned by investors and serviced by Bank of America, while 40 percent were held on the banks own books. (Read More: Bank of America Posts Profit.)

As for other aspects of the settlement, like providing customers with a single point of contact for mortgage assistance, officials said each bank representative is primary contact for between 70 and 75 customers.

All of the five banks that signed the National Mortgage Settlement are required to submit quarterly progress reports to the participating state attorneys general and the federal program monitor.

—By CNBC’s Diana Olick

Click on ticker to follow real estate news:

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Questions? Comments?

Follow me on Twitter @Diana_Olick or on Facebook at facebook.com/DianaOlickCNBC

Article source: http://www.cnbc.com/id/49824237?__source=RSS*blog*&par=RSS

Before You Refinance, Modify Your Loan … If You Can

Wed, 13 Jun 2012 07:00:48 +0000

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A colleague who was looking to refinance his mortgage to today’s record low interest rates, just told me that he opted instead for a “modification.”

No, he’s not behind on his monthly payments, nor even struggling to make them. He is current, and modifications on current loans have been around for years, though they are increasingly rare and consequently few people know about them.

My colleague’s bank, New Jersey-based First Niagara, allowed him to do the modification to a lower interest rate. Here’s the best part: My colleague had to pay just $500 for his 7/1 Adjustable Rate Mortgage (ARM) to go from 4 percent to 3.125 percent, which is an eighth of a percentage point above the going rate, but still a great move. No principal payment, no new underwriting, no nothing.

I called First Niagara and asked if they do mortgage recasts. The first agent said yes, but when I asked to be transferred to a mortgage specialist, and then identified myself as a reporter, I was disconnected … three times.

On the fourth try, I did finally get a nice agent, who called another department and said yes, they do modifications, but more often do “recasts,” in which case a sizeable principal payment is required. Hmmm. Then she said she had to leave a message for someone to give me more details. Still waiting.

Apparently mortgage recasts do exist.

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Article source: http://www.cnbc.com/id/47783706?__source=RSS*blog*&par=RSS

Low prices boost SF home sales to 5-year Jan. high

Tue, 21 Feb 2012 08:11:54 +0000

(02-16) 10:49 PST Los Angeles, CA (AP) –

Home sales in the San Francisco Bay area reached a five-year high for January, as prices and mortgage rates plunged, a real estate tracking firm reported Thursday.

However, many of those purchases involved properties that were subject to foreclosures or short sales, indicating the housing market is far from recovered.

The survey by San Diego-based DataQuick also showed the median sales price in the region fell nearly 3 percent last month from December to $326,000 — less than half the peak price of $665,000 reached in 2007 but up from the low of $290,000 recorded in 2009.

A total of 5,479 new and existing homes were sold in the nine-county area, according to DataQuick. The figure was down nearly 27 percent from December but marked a 10.3-percent improvement over January 2011.

The December-to-January drop was normal for the season, while the January-to-January jump showed real improvement, DataQuick said.

The year-over-year increase in January marked the seventh annual jump in a row, the firm said.

Home sales were buoyed by “lower prices, ultra-low mortgage rates, a modestly improved economy and a record level of investor purchases,” DataQuick said in a statement.

The lower median price in January was “a reflection of how skewed the market has become toward distressed, lower-cost properties,” DataQuick President John Walsh said in the statement. “The higher-end sales have slowed in recent months as many struggle to qualify for loans and others just sit tight.”

Distressed property sales — the combination of foreclosure and short sales — made up more than half of all sales of existing homes. Absentee buyers, who mostly are investors, bought more than a quarter of all homes sold, DataQuick reported

Article source: http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2012/02/16/state/n095612S41.DTL&type=business

Low prices boost SF home sales to 5-year Jan. high

Sun, 19 Feb 2012 01:56:32 +0000

LOS ANGELES—Home sales in the San Francisco Bay area reached a five-year high for January, as prices and mortgage rates plunged, a real estate tracking firm reported Thursday.
However, many of those purchases involved properties that were subject to foreclosures or short sales, indicating the housing market is far from recovered.

The survey by San Diego-based DataQuick also showed the median sales price in the region fell nearly 3 percent last month from December to $326,000—less than half the peak price of $665,000 reached in 2007 but up from the low of $290,000 recorded in 2009.

A total of 5,479 new and existing homes were sold in the nine-county area, according to DataQuick. The figure was down nearly 27 percent from December but marked a 10.3-percent improvement over January 2011.

The December-to-January drop was normal for the season, while the January-to-January jump showed real improvement, DataQuick said.

The year-over-year increase in January marked the seventh annual jump in a row, the firm said.

Home sales were buoyed by “lower prices, ultra-low mortgage rates, a modestly improved economy and a record level of investor purchases,” DataQuick said in a statement.

The lower median price in January was “a reflection of how skewed the market has become toward distressed, lower-cost properties,” DataQuick President John Walsh said in the statement. “The higher-end sales have slowed in recent months as many

struggle to qualify for loans and others just sit tight.”
Distressed property sales—the combination of foreclosure and short sales—made up more than half of all sales of existing homes. Absentee buyers, who mostly are investors, bought more than a quarter of all homes sold, DataQuick reported

Article source: http://www.mercurynews.com/breaking-news/ci_19979272

Low prices boost SF home sales to 5-year Jan. high

Thu, 16 Feb 2012 19:48:29 +0000

(AP) LOS ANGELES — Home sales in the San Francisco Bay area reached a five-year high for January, as prices and mortgage rates plunged, a real estate tracking firm reported Thursday.
However, many of those purchases involved properties that were subject to foreclosures or short sales, indicating the housing market is far from recovered.

The survey by San Diego-based DataQuick also showed the median sales price in the region fell nearly 3 percent last month from December to $326,000 — less than half the peak price of $665,000 reached in 2007 but up from the low of $290,000 recorded in 2009.

A total of 5,479 new and existing homes were sold in the nine-county area, according to DataQuick. The figure was down nearly 27 percent from December but marked a 10.3-percent improvement over January 2011.

The December-to-January drop was normal for the season, while the January-to-January jump showed real improvement, DataQuick said.

The year-over-year increase in January marked the seventh annual jump in a row, the firm said.

Home sales were buoyed by “lower prices, ultra-low mortgage rates, a modestly improved economy and a record level of investor purchases,” DataQuick said in a statement.

The lower median price in January was “a reflection of how skewed the market has become toward distressed, lower-cost properties,” DataQuick President John Walsh said in the statement. “The higher-end sales have slowed in recent months as many struggle to qualify for loans and others just sit tight.”

Distressed property sales — the combination of foreclosure and short sales — made up more than half of all sales of existing homes. Absentee buyers, who mostly are investors, bought more than a quarter of all homes sold, DataQuick reported

Article source: http://www.cbsnews.com/8301-505245_162-57379476/low-prices-boost-sf-home-sales-to-5-year-jan-high/

Foreclosure Delays Plague Housing Recovery

Thu, 12 May 2011 11:55:39 +0000

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Foreclosure activity decreased in April for the seventh straight month, bringing total foreclosure activity to a 40-month low, according to a new report from RealtyTrac. This is not to say that default notices, scheduled auctions and bank repossessions aren’t running well above the norms, with one in every 593 US households receiving a foreclosure filing in April. The numbers are actually quite deceptive.

“This slowdown continues to be largely the result of massive delays in processing foreclosures, rather than the result of a housing recovery that is lifting people out of foreclosure,” notes RealtyTrac CEO James Saccacio in a statement.

There are currently 3.7 million loans that are 90 days or more delinquent, according to RealtyTrac’s Rick Sharga. Nationwide, completed foreclosures (REOs) took an average of 400 days from initial default notice to REO in the first quarter of this year. That’s up from 340 days a year ago and more than double the 151 days in 2007. At the current rate, it would take three to four years to move those loans through the foreclosure process. In some states, the picture is far worse.

In New York and New Jersey, it takes more than 900 days to get through the foreclosure process from start to finish, in Florida 619 days, and in California 330 days, according to RealtyTrac.

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Article source: http://www.cnbc.com/id/42994346?__source=RSS*blog*&par=RSS