There's More to Real Estate...

I am getting so many questions from people who assume that these bills were signed that I am franticto spread the word.

Among the bills awaiting Governor Swarchzenegger's signature were AB 1333 to Protect Tenants in Foreclosed Properties from Utility Shut-offs and AB 2586 to Protect Tenants' Ability to Recover Their Security Deposits after Foreclosure

These bills would have gone a long way to help renters victimized by foreclosure. Unfortunately they met the VETO process in late September and were not signed into law. Tenants caught up in the foreclosure crisis and desperately hoping for help are receiving incorrect information...they are being told that they may now depend on their security deposit being refunded.

Unfortunately the only avenue still open to them is Small Claims Court. It may be possible to recoup...

• Moving companies and rental trucks
• Expenses incurred to find a new home
• Loss of security deposit
• Difference between present rent and new rent
• Cost of new security deposit

The Governor did sign SB 1137 extending the notice period for tenants in foreclosure from 30 to 60 days.

If you know or speak to anyone in this situation please share this information!

Our need to constantly be in touch has now created another health concern. The Brisitsh Association of Dermatologists is warning of a skin rash caused by cell phone use and wouldn't you know it supposedly is more prevalent in women.

It seems the nickel contained in some jewelry & belt buckles is also found in some cell phones and causes a rash to the ear, cheek and fingers of frequent users.

Not only could this be a concern to those who now a use cell phone as their only means of communicztion but also for business users since cell phones have become just another tool for us all!

You don't have to comb public records to find out if your landlord is making mortgage payments. Laws vary by state but many allow a tenant to receive a copy of the Notice of Default. In California the steps are simple (and a lot of states follow California's lead).

• Get a copy of the form & fill it out on your computer
• Call a title company for a copy of the Deed of Trust - you'll need the information contained in this document to fill out the Request of Copy of Notice of Default
• Have the completed form notarized
• Record the Request of Copy of Notice of Default  within the county where the property is located

A bill signed in July of this year (SB 1137) now gives California tenants 60 days notice before the eviction  process but in other states it may be much less.

Renters may have the right to sue the landlord in Small Claims Court to recoup the loss of the security deposit & other expenses.

**In some states, such as Calfornia, a foreclosure wipes out the rental agreement**

Find Renters & foreclosure Information for CA at CAForeclosureInfo

or to locate an attorney for other states go to FindLaw

ForeclosureInfoCA.org is brought to you by the State Bar of California & the Public Interest Clearinghouse.

The site addresses concerns for both homeowners and renters facing foreclosure. It provides links to helpful government sites and also for free or low-cost legal assistance - there's even a senior's legal hotline. You'll also find informative links to California's foreclosure process & timelines.

Don't miss the link for LawHelpCalifornia.org which helps Californians find legal referrals & self-help resources.

The Center for Responsible Lending estimates that one in 33 U.S. homeowners will be in foreclosure within the next 2 years. Nevada, California, Florida & Georgia are among the states hardest hit by the national foreclosure crisis, California also being among the hardest hit by ARM foreclosure starts.

Among the steps taken by California to help ease this crisis:

• Launched a task force
• Regulates high-risk loans
  
•  Encourages lenders to modify defaulted loans
• Mandates that lenders give borrowers in danger of defaulting early notice about available assistance
  
• Has sought voluntary agreements with loan servicers to offer borrowers steps to prepare for payment adjustments

Read the report and find out what your state is doing to help!

Defaulting on the Dream: States Respond to America’s Foreclosure Crisis

Aiding in the foreclosure crisis is dependent on consumer education. Too many homeowners are still reluctant to seek help...too many don't believe help is available or even for real!

A HUD approved non-profit counseling agency is offering a FREE workshop for homeowners in Ontario on October 4. For more details & to register go to...

Housing counselors, mortgage counselors and attorneys will be on site to share valuable information to assist homeowners in making an informed decisions.

**Please help spread the word**

(This post is a requested follow-up to my post Homeowners Also Responsible for Mortgage Fraud.)

Lenders are finally on to this particular scam & are responding with even further tightening of the lending requirements (The Wall Street Journal). They even have the ability to sue the borrower if fraud can be shown.

How Does a ‘Buy and Bail’ Scheme Work?

A borrower qualifies for a loan on a second home by asserting that the first residence will be rented out to help cover the mortgage payments for the second home. Once they are approved for the new loan they walk away from the previous loan not renting out the home or making any further payments.

Are These Professionals?

Possibly most unsettling are real estate agents who believe this is nothing more than a financial strategy and provide ‘tutoring’ for this practice.

Related Posts: Reverse Mortgage Repair Scams
Don't They Realize Where They'll Be Soon?
No Cost "HOPE NOW" Helps Homeowners Avoid Foreclosure But Cautions...

There are so many mortgage & real estate scams to look out for, and they've probably always existed, but the current housing and mortgage crisis seems to be bringing out the unethical and immoral with new vigor. Each of these scams seems to be more dastardly than the next but to be honest it just depends on which one you have read about most recently.

One of the predatory stings seems to involve someone representing himself as a contractor who is hired to make the necessary repairs required before a reverse mortgage can go through.Reverse mortgages have more built-in borrower safeguards than most types of loans. Still, when unfortunate situations like this occur, it shows that no amount of safeguards or regulations can completely insulate the borrower from predators.

Share these tips with someone you care about:

1: Be wary of ANYONE pushing the “idea” of a reverse mortgage on you. Do your own research and make sure a reverse mortgage makes sense for you. It is your money at stake! Be especially wary of anyone who tells you that they’re your only hope for getting a reverse mortgage.

2: Use reverse mortgage counseling to your advantage. Talk with the counselor about the need for repairs and the best way to get the repairs done.

3: If repairs are needed to qualify for a reverse mortgage, get quotes from several contractors and always check references.

PERHAPS MOST IMPORTANTLY

4: Never sign any document that has blanks to be filled in later.

Refer to the HUD's informational website to find more valuable reverse mortgage information.

For more tips on How to Avoid Getting Scammed by a Contractor check out the post by Irina Natchaev

"To speed up the disposition of the 54,000 foreclosed properties it owns, Fannie Mae is opening offices in California and Florida and is considering selling those properties in bulk to investors. "I do not think this is a time to be holding onto (foreclosed properties) hoping for a better day," CEO Daniel Mudd said last week.

...President Bush last month [July 2008] signed sweeping housing legislation that aims to prevent foreclosures by allowing homeowners to swap their mortgages for more affordable loans, but only if their lender agrees to take a loss on the initial loan"

Keep Reading - Foreclosure Filings Up 55%

Related Post

"borrowers should be wary of sources that offer help but require a fee"

When homeowners find themselves facing foreclosure proceedings reaching out to their lender is vital however, the largest comment by homeowners entails the nonresponsiveness of lenders.

There has been a change in lender attitudes though and with the help of HOPE NOW there is more hope of reaching the right person in the Loss Mitigation department.

Call the Homeowner’s HOPE™ Hotline: 1.888.995.HOPE

Hotline Services Include

• Outreach to Homeowners
• Counseling Homeowners
• Assisting Homeowners

2 Million Troubled Borrowers Avoid Foreclosure

"The Hope Now coalition reports that it completed a record number of mortgage workouts in July - but that was outpaced by the increasing rate of foreclosures"

NEW YORK (CNNMoney.com) -- Hope Now has helped more than 2 million at-risk borrowers stay in their homes during the past 13 months, according to numbers released by the coalition on Wednesday. The alliance of mortgage servicers, counselors, and investors assembled to combat foreclosures fixed more than 192,000 problem loans during July, a one-month record that represents a 6% increase over June. Despite this progress, foreclosures continue to climb; 91,752 families lost their homes in July. That represents an increase of 14% from June and more than double the number of July 2007, when only 42,043 homes went to foreclosure.

"The treadmill is still going a little faster than [Hope Now] can keep up with," said Nicholas Retsinas, Director of Harvard University's Joint Center for Housing Studies. "Foreclosures have outpaced the efforts to combat them."

So, Hope Now is stepping up its efforts to reach out to troubled borrowers to let them know help is available, according to Faith Schwartz, the alliance's executive director. The group has promoted its program through advertising, public announcements, as well as letters to at-risk borrowers and large foreclosure prevention events that it's holding around the country.

Reluctant to seek help...read the rest of the article

Related Article: U.S. Foreclosure Filings Up 55% From Last Year

Desperate to get 'out-from-under' in a declining market some homeowners have decided to walk away from mortgages they can no longer afford creating two rising scams to add to the mortgage crisis - the so called "buy and bail" scam and "phony short sales" scam.

Both scams include lying on your mortgage application which is a prosecuteable offense but in the Inland Empire enforcement is taking low priority because of the belief that it will be more beneficial to prosecute scammers who take advantage of consumers rather than lenders.

Read the article...Homeowner Fraud Exacerbates Mortgage Crisis

I came across this article and wanted to share the info. Included are Home Improvement scams and Mortgage Bait & Switch scams...could be important to some of our clients.

Especially close to mind for me was the one regarding Fake Checks. Our office advertised a listing in Yucaipa for a horse property on CraigsList. We received a response from someone in Nigeria. As his emails regarding the property became more strongly worded when I kept asking for a commitment that agreed with our regulations I finally asked that he wire (not send a check) $10,000 to open an escrow his emails ended!

In Pictures: Americas Top Five Scams and How to Beat Them

Related Post: Don't They Realize Where They'll Soon Be?

A recently issued report by the Mortgage Asset Research Institute (MARI) states that mortgage fraud climbed 42% in the first quarter of 2008. The lender criteria has tightened considerably so that some feel it is necessary to 'tweak' applications. The most common situations cited were General Application Misrepresentation such as debt & asset misstatements, invalid social security numbers, incorrect addresses and Employment & Income falsification.

Loan applications are at an 8 year low according to the Mortgage Bankers Association and this supposedly makes the so-called 'professionals' push for clients. Maybe understandable but is this just another another area where it has consumer education is necessary?

Do these clients know where they may be heading?

The number one & two ranked areas were Miami, Florida and Los Angeles, California. Wanna guess where the next 3 top areas for mortgage fraud were?

CNN: Mortgage Fraud is Still Soaring - Read the Story

A report published by FREDDIE MAC (Federal Home Loan Mortgage Corporation) tells us that "fewer than half of homeowners contact their lenders before entering foreclosure". These homeowners are not only missing out on the assistance they might be able to receive from their lender, they more than likely do not know that are entitled to talk to a counseling agency. Others mistakenly believe that transferring title to the property will solve the problem.

Many homeowners who find themselves facing foreclosure proceedings labor under the misconception that the banks or lenders want their home; this is not true. The foreclosure will cost any lender tens of thousands of dollars. Understandably the lender would rather avoid foreclosure and prefers workout plans and debt solutions to foreclosure.

Among the options your lender may be able to offer are:

• Reinstatement (lump sum payment)
  
• Forbearance
  
• Repayment Plans
• Loan Modification
  
• Deed-in-Lieu Agreements
  

Be sure that you get a written agreement outlining the terms of the transaction and that your lender offers and that you read and understand the entire transaction. Why?

Any agreement should clearly state that the lender is accepting these terms instead of going forward with foreclosure proceedings and that this agreement will fulfill your obligation to the lender. Example a Deed-in-Lieu does not automatically wipe out junior liens (2nd mortgages) whereas a foreclosure does.

Short Sale

You may want to consider a "short sale" of your home to avoid the recording of a foreclosure on your credit report. Short sales occur when the bank accepts less than the balance of your loan in payment of your debt (again be sure the amount accepted fulfills your obligation). A short sale agreement may be reached with your lender if you are at least 2 months in arrears* on your payments and the amount offered by the buyer is approved by the lender.

If you do decide to put your home on the market it would be to your advantage to contact an aggressive real estate agent with experience handling distress sales.

Contact your lenders loss mitigation department immediately to find out if they are open to such a sale.

Title Transfers and Foreclosure

There are two reasons that transferring title does not solve the foreclosure problem.

1. Many transfers are commonly accomplished through a quit claim deed. A quit claim deed conveys ownership and transfers financial responsibility in regard to property taxes, etc. BUT DOES NOT change any obligation under a mortgage.

2. Most mortgages or trust deeds today contain alienation or acceleration clauses. An alienation or acceleration clause is language contained in the loan documentation (mortgage or deed of trust) allowing the loan to become due and payable in the event the owner sells or transfers title to the property.

I.E. Title to the property cannot transfer either by sale or quit claim deed without triggering the Acceleration or Alienation Clause thus causing the loan balance to become due and payable.

Assumable Mortgages

I should have expected someone to consider this as a solution to foreclosure but I have to admit when I was asked about getting someone else to take over the loan to stop the foreclosure I was surprised.

A home buyer may be able to assume ("takeover") the seller's mortgage. However, even though an assumable mortgage does not have a due-on-sale clause, assumable mortgages are a rarity today and lender approval of the new borrower is required.

If you don´t feel comfortable talking to your lender yourself a HUD Approved Housing Counselor for the National Homeownership Preservation Foundation can be reached on the web at www.995hope.org or by calling 888-995-HOPE 24 hours a day/7 days a week.

Your window of opportunity passes much too quickly when it comes to foreclosure proceedings – time is crucial – ACT NOW!

© 2008 by Lynnette Phillips

* I stand corrected...

"In your article you wrote that you have to be 2 months in arrears. Actually some short sales have been arranged when the owner was current. It is rare but it does happen with the right circumstances."

Mike Rohrig

Related Articles

The expense of closing costs are a major concern of most clients. Bankrate.com did a survey so we can more easily answer that question. These figures are based on a $200,000 property.

Top 10 Least Expensive States For Closing Costs

1. North Carolina $2,650
2. Kansas $2,669
3. Missouri $2,758
4. Maine $2,793
5. South Dakota $2,797
6. Iowa $2,804
7. Wyoming $2,804
8. Illinois $2,826
9. Vermont $2,872
10. Indiana $2,878

Top 10 Most Expensive States For Closing Costs

1. New York: $4,016
2. Texas: $3,975
3. Florida: $3,683
4. Oklahoma: $3,558
5. New Mexico: $3,465
6. New Jersey: $3,432
7. Pennsylvania: $3,411
8. Alaska: $3,409
9. Colorado: $3,358
10. California: $3,321

Find how your state ranks.

I wanted to share the news of this event. With the San Bernardino-Riverside county areas ranked #5  in Realty Tracs current foreclosure report any home retention assistance is vital. Consumer education is equally vita

"According to a recent study published by Freddie Mac http://www.freddiemac.com/service/msp/pdf/foreclosure_avoidance_dec2005.pdf

FEWER THAN HALF OF HOMEOWNERS CONTACT THEIR LENDERS BEFORE ENTERING FORECLOSURE.

Contrary to popular belief, banks and lenders substantially prefer mortgage workout plans and debt solutions to foreclosing on defaulted mortgage property – foreclosure can be far more costly and worsens America’s credit situation in an already weakening economy."

Call (909) 862-6030 for Details  about this workshop to be held 8/16/08.

Related Posts: Minorities Are Foreclosure Scam Targets

How Common Are Foreclosure Scams in Your Area?

You're anxious to start looking for your dream home but wait, there are a few things you should consider before you start burning up yours and your real estate agent's time.

1. Think Long Term – Ask yourself some questions:

• How long do you want to stay in the home?
• Will this be a first home for just yourself or a young family or do you plan to raise the kids here? Raising your kids in this home will require schools, parks and recreation, after school programs, etc.
• What features are most important to you…a large yard, a home office, a pool, home owners' association?

These questions can help you determine what kind of home you´ll be looking for and the type of mortgage and terms will be best.

2. When Can You Move – When is your lease term up? Are you permitted to sublet? Is there a penalty for early lease termination?

3. Talk To A Lender or Mortgage Broker – Get preapproved for a mortgage before you start looking. You might be surprised at the advantages a preapproval letter can provide.

You will be able to:

• Save time by looking only at homes you have the funds for,
• Increase your negotiating capability by giving the seller the reassurance of a preapproval letter along with your offer, * Reduce any last-minute surprises that might disqualify you and dash your dreams,
• Enjoy a shorter closing period because the loan application has already been processed.

Terminology

Preapproval indicates that a borrower's credit, references and employment have been verified.

Prequalification is based on the opinion of a loan officer and implies a person is creditworthy but that nothing has yet been verified.

Mortgage Brokers have a large selection of lenders to scrutinize so that they can bring borrowers and lenders together to find the best financing options and loan programs possible.

Lease Termination Penalties can be as much as the balance of rent the landlord could lose if unable to rent the home again, i.e. if you have a 12 month lease term but decide to leave after 6 months the penalty could be the amount of six months rent.

Related Articles

In the current market many homeowners are finding themselves faced with foreclosure proceedings. With the hope of catching-up the delinquent payments dwindling the only option left often becomes selling the home…quickly.

Many areas have seen home values drop so that sales prices will not cover the loan balance. Don´t despair.

Your lender may be willing to work with you on a short sale transaction, i.e. you can sell the home for current market value but the sale is lender approved as to what they will accept for a pay-off of the loan. If a short sale offer is submitted for your home your lender might be willing to delay any foreclosure proceedings.

Valuing your home

For a fast sale it´s important to price your home right. How do you value your home? Difficult as it is you need to stop seeing it as your home with all the memories and emotions that may be attached and step back to look at it as a buyer might.

Start with a "market analysis". Compare your house to houses in the area with similar characteristics:

• Similar square footage, number of bedrooms/bathrooms
• Similar features (fireplace, pool, etc.) # Within one mile of your home
  
• Similar year built
• Sold within the last 6 to 12 months
  

Many real estate agents offer a free market analysis of your home. Ask for a list of all the comparable listings in your area.There are also many websites that will prepare a guesstimate as to the value of your home.

Shoot for a bottom line price

An accurate listing price is a necessity when looking for a prompt sale. There probably isn´t a lot of time for negotiations.

Look objectively at any necessary repairs, get estimates to make those repairs and subtract their cost from the market value.

Also subtract the amount of closing costs from the market value of your home. A real estate agent can probably help you determine this figure for your area (closing costs may amount to at least 3-6% of the sale price of the property).

After subtracting the costs of repairs and closing costs from the market analysis you have a listing price.

For the actual sale of your home you´ll want to engage a Realtor savvy in distress sales. A short sale is more involved than the usual sale and you´ll be glad to be able to fall back on the Realtor´s knowledge.

Related Articles

How often have you been on the road and need make a call but don't have the number burned into your memory? You certainly can't check the yellow pages while you're driving...even if you kept the phone book in your car. With wireless calls to 411 so expensive (usually ranging from $1.00 to $1.75) you begin to think about how important it is to make that call right now.

Maybe there's a solution. Program the number for FREE 411 calls into your cell phone's memory - free up your memory, make more hands free calls and save some money at the same time!

FREE Wireless 411
1 (800) 373-3411

Another Tip

You're on the road again...Hey, we're in California - we practically live in our cars! Several hundred miles from home you witness an accident ahead. You start to call 911 to reach emergency sercives but you're out of the area for your cell phone service. Dial 112 instead. By zeroing in on your current location 112 will help you reach assistance for any area.

5 Things You Never Knew About Your Cell Phone

Related Articles: Telemarketers and Wireless 411 Directory.

Keep telemarketers from using up your precious minutes - list your cell phone number with the FTC's Do Not Call Registry

You've found the perfect area to raise the kids...a safe neighborhood, parks & recreation areas near, after school programs abound, freeway close for that commute,  but what about the schools. Education is important, how do the schools compare? 

Find the schools in your area and locate data such as academic performance, graduation rates, student-teacher ratio, course offerings and compare by viewing the website California School Finder.