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By Paul A. DiSegna | Real Estate Pro in Rhode Island
  • Where Abundance Abounds

    Posted Under: Home Buying in Rhode Island, Home Selling in Rhode Island, Foreclosure in Rhode Island  |  November 12, 2011 4:17 AM  |  581 views  |  No comments

    RISMEDIA, Saturday, November 12, 2011—

    Although we’ve been hearing over and over that distressed property sales are a huge part of today’s real estate market, pursuing short sales as a viable business option has been avoided by over 90% of real estate agents. Less than 2% of those who venture into the short sale arena are successful. Yet, over the next five years, it is predicted that 40-60% of all sales will be distressed, i.e., REO/short sales.

    Short sales are too big a piece of the market to simply ignore. Getting involved in short sales can grow your business and give you a referral stream for life. So what’s causing the disconnect? Bad press.

    Most negative information/misconceptions about short sales come from a lack of experience or knowledge. With proper education and training, however, you can successfully close short sales. It takes patience, organization and a serious amount of persistence. It also requires a dedication to the learning process and a constant honing of your skills. Trust me, I know this firsthand. I am a member of a team that has conducted over 300 successful short sale transactions.

    I won’t try and tell you that short sales are easy, but I can vouch for the fact that they can be a very big part of your business now and for years to come. The catch? You must be willing to invest the time it takes to become proficient in this important real estate niche.

    Here are a couple of things to think about:

    • Sellers who are in a distressed situation are usually emotionally and economically distraught. By stepping in to help them, you are relieving a huge amount of pressure and giving them a solution for the issue they’ve been struggling with.
    • By stopping someone’s home from going to foreclosure, you create a “raving fan” who will tell all his/her friends and family members what a great job you did. This will create an ongoing referral system for you.
    • Word-of-mouth is the very best form of marketing. Successfully stopping someone’s house from going to foreclosure will create a very loyal and satisfied customer who will be happy to tell everyone in the community about your skills.
    • Completion of just a couple short sales will create “buzz” about your skill, which, in turn, will create presence in the real estate community and the consumer community as well.
    • By preventing homes from going to foreclosure, you will be performing a community service in your area. You will be actively stopping the foreclosure plague in your community. This may attract media attention and lead to public speaking events, etc.
    • By participating in short sales, you will create a niche for yourself in the community, which will separate you from the competition.
    • Short sales create banking connections that may allow you to get into the REO banking business as well.

    Understand this: Most of the negativity you hear in reference to short sales, such as, “they take too long,” “the bank is not willing to accept the value,” or “the bank denies sellers into the program,” comes from uneducated and/or inexperienced parties handling these types of transactions.

    Next month, we’ll talk about how to avoid some of these issues and we’ll provide you with a roadmap that will allow you to successfully navigate through the short sale process.

    George “Gee” Dunsten, president of Gee Dunsten Seminars, Inc., has been a real estate agent and broker/owner for almost 40 years. Dunsten has been a senior instructor with the Council of Residential Specialists for more than 20 years.

    RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

  • Ocwen to Buy Saxon for $59.3 Million 10/24/2011

    Posted Under: Home Buying in Rhode Island, Home Selling in Rhode Island, Foreclosure in Rhode Island  |  October 24, 2011 3:45 PM  |  431 views  |  No comments
    BY: CARRIE BAY Printer Friendly View

    Morgan Stanley has announced the sale of Saxon Mortgage Services to Ocwen Financial Corporation.

    Ocwen has agreed to acquire Saxon for the base purchase price of $59.3 million. The deal also includes an estimated $1.4 billion for servicing advance receivables outstanding.

    The transaction is expected to close in the first quarter of 2012. According to Reuters, Morgan Stanley bought Saxon in August 2006 for $706 million.

    This will mark Georgia-based Ocwen’s second major acquisition of a residential mortgage servicer in less than a year’s time. In both cases, Ocwen took the servicing businesses off the hands of investment banks.

    In June, Ocwen agreed to purchase Litton Loan Servicing from Goldman Sachs.

    In September of 2010, Ocwen completed its acquisition of HomEq Servicing, the U.S. mortgage servicing business of Barclays Bank.

  • The Basic Steps of Foreclosure

    Posted Under: Foreclosure in Rhode Island, How To... in Rhode Island  |  October 9, 2011 4:54 AM  |  466 views  |  No comments

    RISMEDIA, Saturday, October 08, 2011—

    (MCT)—Fannie Mae has publicly assured homeowners going through foreclosure that they will be protected from losing their homes while applying for a federally funded loan modification. They can apply for a modification at any point before or during theforeclosure process. If a modification is approved, homeowners can keep their homes if they make their adjusted payments. Absent that, here are the stages of a typical foreclosure:

    1) In default: A loan is in default when a mortgage payment is 30 days late.

    2) Warning: When a loan is 60 days past due, the bank, credit union or mortgage company warns that foreclosure is the next step.

    3) Proceedings begin: After 90 days, the lender refers the loan to its foreclosure department, and hires a local lawyer to begin foreclosure proceedings.

    4) Sale advertised: The lender's lawyer advertises the property for sale for four consecutive weeks in a local newspaper. The sheriff's sale date is listed in the advertisement.

    5) Sale held: The sale is held on the published date. A sheriff's employee conducts a courthouse auction and the highest bidder wins, usually the bank that owned or serviced the mortgage.

    6) Sheriff's deed: The winning bidder gets a sheriff's deed that lists the last date the homeowner can redeem, or take back, the property, usually six months from the date of the sheriff's sale. During this redemption period, the homeowner can live in the property or try to sell it.

    7) Redemption period: To redeem a property, the homeowner must pay off the mortgage and all interest and late fees, court and attorney fees, title and appraisal fees, taxes and insurance. Otherwise, they will be evicted from the home.

    (c) 2011, Detroit Free Press.

    RISMedia welcomes your comments and questions. Emailrealestatemagazinefeedback@rismedia.com.

  • Homeowners Facing Foreclosure Take Back Homes on September 22

    Posted Under: Quality of Life in Silver Springs, Market Conditions in Silver Springs, Foreclosure in Silver Springs  |  September 16, 2011 4:20 AM  |  1,088 views  |  No comments

    RISMEDIA, Friday, September 16, 2011—

    Millions of homeowners share a feeling of helplessness, not knowing where they stand with their bank and not understanding the foreclosure process. A new resource called the Foreclosure Defense Academy aims to rescue these homeowners from their information abyss, beginning with an educational webinar scheduled Sept. 22 – 24, when a national audience will learn how to navigate their own foreclosure situation even if they can’t afford legal representation.

    “Blame for today’s housing crisis is shared among all parties involved,” says Tom Damron, real-estate veteran from Silver Springs, Florida and founder of LegalOops.com, which will host this live event from Salt Lake City. “But banks deserve most of the blame, especially following the Commodity Futures Modernization Act in December 2000 when Congress and President Clinton enacted legislation that made it possible to convert mortgages into securities fostering an environment for exotic and sub-prime loans.”

    When the housing bubble burst in 2008, banks took advantage of bailout money handed to them, and homeowners were left in a sea of frustration. Millions of homeowners have tried to responsibly work with their lender towards a fair resolution. Many foreclosure defense attorneys are unaware of the depth of the fraud being committed by lenders and some have taken on too many cases, leaving their homeowner clients vulnerable to endless frustration.

    A complete history and understanding of how the mortgage industry evolved into what many believe is the biggest Ponzi Scheme in human history will be covered in these online events, including the securitization of loans and how it effects over 60 million mortgages today. Damron will explain how homeowners can navigate the foreclosure process to level the playing field with their bank and win their court case in some instances. For homeowners currently working with legal representation, the webinars will help them finally become an active participant in the process without leaving everything up to an attorney who may not be paying full attention to their case.

    “This isn’t about excusing people from the responsibility they share in this mess,” adds Damron. “But of all the parties involved, the homeowner has the biggest disadvantage with limited knowledge of the process and essential steps that need to be taken.”

    Due to the heavy traffic potential, those that wish to attend are urged to reserve their seat early. In an effort to accommodate as many as possible LegalOops will be hosting four events daily during the Sept 22-24 dates.

    For more information, or to register, visit www.LegalOops.com. Registration begins today, Sept 16, 2011.

    RISMedia welcomes your comments and questions. Emailrealestatemagazinefeedback@rismedia.com.

  • FHFA vs. Mortgage Powerhouses: What Does It Mean for the Market?

    Posted Under: Home Buying in Rhode Island, Home Selling in Rhode Island, Foreclosure in Rhode Island  |  September 3, 2011 5:32 AM  |  445 views  |  No comments
    BY: CARRIE BAY Printer Friendly View

    It’s official. The Federal Housing Finance Agency (FHFA) has unleashed a barrage of lawsuits against Wall Street investment banks and major mortgage lenders.

    The GSEs’ conservator is suing 17 financial institutions, as well as officers of the companies and unaffiliated underwriters, alleging violations of federal securities laws related to private-label mortgage bonds sold to Fannie Mae and Freddie Mac.

    Complaints have been filed against the following lead defendants:

    1. Ally Financial Inc. f/k/a GMAC, LLC
    2. Bank of America Corporation
    3. Barclays Bank PLC
    4. Citigroup, Inc.
    5. Countrywide Financial Corporation
    6. Credit Suisse Holdings (USA), Inc.
    7. Deutsche Bank AG
    8. First Horizon National Corporation
    9. General Electric Company
    10. Goldman Sachs & Co.
    11. HSBC North America Holdings, Inc.
    12. JPMorgan Chase & Co.
    13. Merrill Lynch & Co. / First Franklin Financial Corp.
    14. Morgan Stanley
    15. Nomura Holding America Inc.
    16. The Royal Bank of Scotland Group PLC
    17. Société Générale

    When news of the impending lawsuits broke, the industry was all abuzz, but those we’ve spoken with say it shouldn’t have come as a surprise.

    The complaints seek damages and civil penalties. Based on initial reports, FHFA is looking to recoup between $30 billion and $45 billion hemorrhaged from the GSEs’ pockets after they bought securities issued between 2005 and 2007, which were made up of loans that later went into default.

    FHFA alleges that the loans underlying the mortgage bonds carried a higher risk than what was disclosed to Fannie and Freddie at the time of purchase.

    Ron D’Vari, CEO and co-founder of the capital markets advisory firm NewOak Capital, says because Congress passed a measure in September 2008 placing a three-year statute of limitations on such lawsuits to be filed by FHFA, the agency was running up against deadline.

    “The last thing a regulatory body wants to be accused of is, ‘you should have taken some action and you didn’t.’” D’Vari says.

    The complaints, filed Friday after the markets closed, stem from an investigation launched last year by FHFA, in

    which the agency issued 64 subpoenas to obtain information about deals with the two GSEs.

    The first lawsuit to result from that investigation was filed in late July against UBS Americas, Inc. Edward DeMarco, FHFA’s acting director, warned at that time there would be “further actions to come.”

    Jack Konyk is executive director of government affairs with the law firm Weiner Brodsky Sidman Kider PC. He says there are two sides to this coin and both have legs to stand on, which means a court may be the best place for the scene that’s about to play out.

    With Fannie and Freddie bleeding green for some time now, Konyk says FHFA is in a political position where they have to do something. As conservator, the agency’s primary responsibility is to protect the GSEs’ assets and promote financial soundness.

    On the other hand, Konyk points out that “it’s awfully easy to apply hindsight” when you have the benefit of knowing the bond issuers were off the mark in their assessments years earlier.

    The problem in this circumstance, he says, is there are other mitigating factors that likely played a role in loan deterioration, including a historic economic downturn, rampant unemployment, and regressive conditions in the housing market.

    Knoyk asks, to what degree can the federal agency expect, and then lay legal liability on, the ability of these financial firms to gauge the economic future correctly?

    Gene Kirsch, senior financial analyst at Weiss Ratings says he finds it “ironic” that after bailing out these institutions, the government would then turn around and sue the very companies they rescued.

    He says we’re back to the same uneasy feeling of 2008 and 2009, where the overhang of bad mortgages is threatening the viability of these same institutions.

    For the most part, though, Kirsch says the banks have some sort of contingency strategy for this situation, having set aside reserves for loan losses and possible litigation.

    According to Kirsch, this will likely go the way most litigation does and end in a settlement, probably “significantly south” of the $45 billion figure at the upper end of initial estimates.

    A more long-lasting impact may come in the form of higher mortgage costs for consumers, Konyk says.

    Such a strong-arm action by the regulator of the nation’s two largest mortgage financiers could potentially change behavior in terms of underwriting, rating, and selling mortgage-backed securities, according to Konyk, especially if financial institutions feel they have to be able to judge future performance based on unforeseen conditions.

    The extra risk that comes with such assessments and the liability for getting it wrong, Konyk explained, will be priced in and people will have to start paying more for mortgages.

    The legal complaints filed by FHFA against each of the 17 firm scan be accessed online.

  • Foreclosures Now Take 20 Months

    Posted Under: Market Conditions in Rhode Island, Home Selling in Rhode Island, Foreclosure in Rhode Island  |  September 2, 2011 11:47 AM  |  512 views  |  No comments

    RISMEDIA, Friday, September 02, 2011—

    The average home entering the foreclosure process today won’t house new owners until the next president has been inaugurated and in office for three months.

    New data from LPS shows that payments have not been made on the average loan in foreclosure in a record 599 days, or 20 months. Of the nearly 1.9 million loans that are 90 or more days delinquent but not yet in foreclosure, 42 percent have not made a payment in more than a year with an average delinquency of 397 days—also a new record.

    At the same time, first-time foreclosure starts in June were near three-year lows, and first-time delinquencies accounted for only 25 percent of new delinquent inventory, according July Mortgage Monitor report released by Lender Processing Services, Inc.

    As of the end of June, 4.1 million loans were either 90 or more days delinquent or in foreclosure, as delinquencies remain two times and foreclosures eight times pre-crisis levels. Foreclosure sales remain constricted, with foreclosure starts outnumbering sales by a factor of almost three to one.

    The slowdown is most pronounced in judicial foreclosure states, which maintain a foreclosure and seriously delinquent pipeline that is more than three times as long as non-judicial states. On average, at the current rate of foreclosure sales, judicial foreclosure states would require 111 months to work through inventories of loans that are 90 or more days delinquent or in foreclosure as compared to non-judicial states, which would be able to clear the inventories in approximately 32 months.

    The total U.S. loan delinquency rate is now 8.34 percent. The month-over-month change in delinquency rate is 2.4 percent and the total U.S foreclosure pre-sale inventory rate is now 4.11 percent

    For more information, visit www.realestateeconomywatch.com.

    RISMedia welcomes your comments and questions. Emailrealestatemagazinefeedback@rismedia.com.

  • What Foreclosures Cost the Community

    Posted Under: Quality of Life in Rhode Island, Market Conditions in Rhode Island, Foreclosure in Rhode Island  |  August 25, 2011 2:19 PM  |  448 views  |  No comments

    RISMEDIA, Thursday, August 25, 2011—

    (MCT)—The effects of a home foreclosure extend beyond the family losing its property. The costs—emotional and financial—extend to neighbors, communities and others, though estimates vary.

    Lender: The Joint Economic Committee of Congress wrote in 2007 that foreclosures carry an average cost of about $78,000, while preventing a foreclosure costs about $3,300. Most of the expense ($50,000) is borne by the lender, which takes title to the home and must find a buyer. 

    The Mortgage Bankers Association said costs to lenders include lost principal and interest payments, tax and insurance on the property, maintenance and real estate commissions when a home is sold.

    Homeowners: The congressional report put the average cost to homeowners at $7,200 for lost equity, moving expenses, legal fees and the like. They will likely take a hit to their credit score, which can affect jobs because some employers check credit scores before hiring or promoting workers. Lose a home, and you also lose the tax advantages of owning a home.

    Local government: Communities can lose anywhere from a few 

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