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Suzy Morris' Blog

By Suzy Morris | Agent in San Diego, CA
  • Bank of America Annouces New Program to Reduce Principal for Underwater Mortgages

    Posted Under: Foreclosure in San Diego County  |  March 24, 2010 10:00 AM  |  1,392 views  |  No comments

    Reuters is reporting that Bank of America will announce Wednesday a program to help homeowners with underwater mortgages.  They will allow borrowers to systematically reduce the principal they owe over five years, as long as they stay current on payments.

    The program targets borrowers who owe more than 120 percent of their home’s worth.

    BofA is also expected to reduce principal balances on “payment option” ARMs with negative amortization to as low as 95 percent of property’s value.

    Beginning in May, BofA is expected to identify and notify homeowners it believes are eligible for these adjustments.

    Read more here: http://suzymorrisrealestate.com/?p=484

  • FTC Proposas Ban on Up-Front Loan Mod Fees

    Posted Under: Foreclosure in San Diego County  |  February 8, 2010 2:13 PM  |  573 views  |  No comments

    So many distressed homeowners got duped by firms charging huge up-front fees and delivering nothing that the Federal Government has been forced to step in:

    The Federal Trade Commission (FTC) has proposed a new rule that would prohibit third parties, including loan modification specialists and loss mitigation attorneys, from collecting payment for foreclosure prevention services until after they obtain a documented offer from a lender or servicer for a modification or other form of mortgage relief.

    The FTC has brought 28 cases against companies suspected of foreclosure rescue and mortgage modification scams, and state and federal law enforcement partners have brought hundreds more. According to the agency, generally these cases charged that companies do not provide the services they promise and that they misrepresent their affiliation with the government and government housing assistance programs, including the Making Home Affordable program.

    The State of California was ahead of the curve on this one and banned all up-front fees on October 11, 2009 when Governor Schwarzenegger signed Senate Bill 94 into law and it took affect immediately after his signature. The bill prohibits anyone, including real estate agents and attorneys from demanding or collecting advance fees for loan modification or loan forbearance services.

    For more information, visit my site:  http://suzymorrisrealestate.com/2010/02/finally-ftc-proposas-ban-on-up-front-loan-mod-fees/

  • Will the Spring Bring Increased Short Sale Listings and Closings?

    Posted Under: Foreclosure in San Diego County  |  January 22, 2010 6:30 AM  |  256 views  |  No comments

    While the banks have been moving at a glacial pace to process short sales, inventories of distressed homes in Southern California are building up at an alarming rate.

    According to a new study by Housing Predictor, only an estimated 8 to 12 percent of all homeowners who request a short sale actually completed a transaction.

    Think about that alarming startling statistic — if a seller is requesting a short sale, they most likely have an offer in hand and have submitted it to the bank.  Why are they not going through?

    Housing Predictor believes the biggest problem with short sales is price. Real estate agents are trying to do a delicate dance of listing properties at levels where they will get offers from buyers AND approvals from the banks.  But the banks are pushing back, believing that the price is often too low.

    Now we are seeing indications that the climate may be improving somewhat for homeowners who need to do a short sale:

    In possibly the first indication of a growing second wave of foreclosures, an increase in distressed properties listed for sale is already beginning to develop in Southern California. Dana Point has seen its inventory of foreclosures and short sales jump to more than 24 percent of all homes listed for sale, and nearby Laguna Beach and San Clemente have seem similar increases.

    While this rise in troubled properties indicates that lenders have increased foreclosures, it may also signify that that they are showing more cooperation in the case of short sales, Housing Predictor said.

    We should also see an uptick in short sale activity and closings after April when the sweeping new rules passed by the Treasury Department go into effect.  The program for at-risk homeowners at risk of foreclosure called the Home Affordable Foreclosure Alternatives will give bankers $2,000 in exchange for handling a short sale.

    For more info, visit my Website.

  • Making Home Affordable Doing More Harm than Good?

    Posted Under: Foreclosure in Carlsbad  |  January 2, 2010 6:40 PM  |  215 views  |  No comments

    The New York Times has caught on that President Obama’s $75 billion program

    Making Home Affordable, has been widely pronounced a failure. Some economists and real estate experts are now saying it has done more harm than good.

    Since President Obama announced the program in February, it has lowered mortgage payments on a trial basis for hundreds of thousands of people but has largely failed to provide permanent relief. Critics increasingly argue that the program, Making Home Affordable, has raised false hopes among people who simply cannot afford their homes.

    As a result, desperate homeowners have sent payments to banks in often-futile efforts to keep their homes, which some see as wasting dollars they could have saved in preparation for moving to cheaper rental residences. Some borrowers have seen their credit tarnished while falsely assuming that loan modifications involved no negative reports to credit agencies.

    Some experts argue the program has impeded economic recovery by delaying a wrenching yet cleansing process through which borrowers give up unaffordable homes and banks fully reckon with their disastrous bets on real estate, enabling money to flow more freely through the financial system.

    “The choice we appear to be making is trying to modify our way out of this, which has the effect of lengthening the crisis,” said Kevin Katari, managing member of Watershed Asset Management, a San Francisco-based hedge fund. “We have simply slowed the foreclosure pipeline, with people staying in houses they are ultimately not going to be able to afford anyway.

    As of early September, only about 1,700 homeowners had finished all the paperwork and received a new permanent loan. Treasury officials projected Monday that 375,000 homeowners would hit the deadline to convert to permanent modifications — or fall out of the program — by year-end.

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