Real Estate News

9-18-2014: The National Felons League (NFL) is trying to make an perceived effort to police their brood…epic fail….Ever read North Dallas Forty? I don’t think it was mandatory reading in preparation for the NFL..or was it?

Once a settlement of the $25 Billion of the big banks happened, just like the current NFL concussion cap, it caps their losses and then they can go on building revenue again with no fear of taking another hit…just, where has the $25 Billion been spent since? Maybe to improve the POTUS’ golf game? Job creation….

References to products and services are not a specific endorsement, but the user must perform their due diligence and investigate whether the product or service is right for them. I welcome any or all comments that would help others.

Comment: So basically what this program is saying is that the US Government can’t do anything collect & redistribute money to non-profit groups who “can” do something about housing the poor…so why not just promote contribution$ directly to non-profit groups directly and lower taxes to the federal government?

Update: 1-23-2015: HUD Awards $10 Million in ‘Sweat Equity’ Grants to Aid Homeownership

HUD just awarded $13 million in “SWEAT EQUITY” grants to help organizations like Habitat for Humanity buy land or build homes for low income residents.

SHOP awards grant funds to eligible national and regional non-profit organizations to purchase home sites and develop or improve the infrastructure needed to set the stage for sweat equity and volunteer-based homeownership programs for low-income persons and families (i.e., Habitat-for-Humanity). SHOP funds must be used for eligible expenses to develop decent, safe and sanitary non-luxury housing for low-income persons and families who otherwise would not become homeowners. Homebuyers must be willing to contribute significant amounts of their own sweat equity toward the construction or rehabilitation of their homes.

Eligible Applicants:

National and regional nonprofit organizations or consortia with experience in using homebuyer and volunteer labor to build housing may apply for SHOP grants. Applicants must have completed at least 30 units of self-help homeownership housing within the last 24 months. Eligible homebuyers must apply to participate in the SHOP program through a current SHOP grantee or one of their affiliates.

Source: http://portal.hud.gov/hudportal/HUD?src=/program_offices/comm_planning/affordablehousing/programs/shop

What’s in your wallet…old timer?

The Reverse Mortgage Stabilization Act of 2013 authorizes the Secretary of Housing and Urban Development to establish additional requirements to improve the fiscal safety and soundness of the home equity conversion mortgage (HECM) insurance program…including higher rates.

Here is the FHA’s Single Family Housing Loan Quality Assessment Methodology (Defect Taxonomy) that FHA wants public feedback from 9-16-2014 thru 10-16-2014.

Well, here we go again – the US Government is getting deeper involved with mortgages and guarantees – this time to help Seniors refinance their home equity on an annuitized basis through a Home Equity Conversion Mortgage (HECM)

Loan requires (1) financial analysis – loan qualification; (2) maybe a escrow account, and (3) may limit amount of initial withdrawl to cover loan costs.

Sources:

Reverse Mortgage Reform Bill article

5-22-2014: Large investors are reaping greater rental returns than rising prices – for now…Estimated large investors bought >$500 million of properties per month in 2013 and bought $400 million per month this year. WSJ, 5-21-2014,C9.

Ever wonder who’s buying up all those foreclosures?

It’s not the little fish, but the big ones.

Get in line because your about 200,000 homes behind per this article.

Blackstone Group has purchase about 32,000 homes for $5.5 Billion; American Homes 4 Rent bought about 19,000 homes for about $3.3 Billion; Colony American Homes bought about 14,000 homes for $2.2 Billion; Silver Bay Realty bought about 5,500 homes for $580 million; and Waypoint Homes bought about 4,500 homes for $730 million.

Why? For securitization of the buy to rent portfolio (pool of assets)…to sever into other layers/bonds that are then sold to other investors – but at what return rates?

Unknown at this time, but I imagine it will be profitable…Duh!

Update 8-29-2013: Blackstone Group is buying 80 apartment complexes (about 30,000 units) in Atlanta, Dallas, Houston and other markets for about $2.7 Billion banking on the slowdown of first time home buyer market due to tighter mortgage qualification requirements and lower FICO scores that first time buyers usually have. Source: WSJ,8-13-2013, C1

Source:  Wall Street Journal, 7-31-2013, Page C6.

2-20-2015: Real Estate Agents Are Desperate to Understand Millennial Homebuyers.

11-6-2014: First time home buyers comprised about 33% of all buyers in the latest 12 month period…Besides higher rents and student loan debt, the confidence in the economy is very low.

8-24-2014: Just performed a simple search for available properties under $175K along Powers Ferry Road in Marietta in either Pope or Walton school districts and found none available…in past 2-3 years there were more available. Inventory fluctuations, higher interest rates, and decline of purchase mortgage applications recently don’t bode well for the first time home buyer.

6-1-2014: Tight lending standards, fewer affordable starter homes (i.e., higher prices), sluggish economy, lower salaries, and joblessness are forcing younger, first time home buyers away from buying homes and continue to rent or live at home with parents. This may take a few years to return to a more normal environment. Source: WSJ, Sat-Sun May 24-25, 2014, page A2.

Rising home prices – rising mortgage rates – stiffer prequalification criteria – unfavorable appraisals – FHA’s increase of Mortgage Premium Insurance forever on FHA loans and traditionally lower FICO scores have many first time home buyer squeezed out of the home buying process.

According to the Wall Street Journal (7-23-13, A1), this category of buyers who are traditionally comprise about 40% of the market are down 25% this past year.

This category of home buyer has helped boost real estate recoveries in the past

Another source: http://www.moneynews.com/FinanceNews/CFPB-mortgage-refinancing-rules/2013/09/05/id/523936

10-22-2013 Note: Some traits and trends of first time home buyers.

The Wall Street Journal (6-15/16, B1) revealed some generic drug manufacturers are actually producing brand name drugs because major brand names are coming off patents and now there’s intense competition and a scramble for profits.  Not sure if they are protected under the Supreme Court decision to protect generic drug manufacturers from litigation, but time will tell how the court’s interpretation of law will unfold.

The Wall Street Journal (article in the 6-25-13 WSJ Page B8) reported the Supreme Court decision earlier this year to limit the rights of consumers to bring product liability lawsuits against generic drug manufacturers (but lenient on Brand Name Drug Manufacturers).

The attorney for the plaintiff said the FDA needs to change its requirements for generic drug manufacturers to improve safety information on generic drug labels.

Well, duh!

And what happens if you’re screwed by a generic drug and they say “sorry”?

Com-on – are we really looking to kill a certain number of people each year from medications that don’t have appropriate warnings to keep population in control and health care costs lower?

Obamacare might accelerate this death of senior or unhealthy to keep costs low.

This is not intended to be legal advice, just a friend talkin’ here…

First, let’s define a deed..

A Deed is a transfer of rights..

Three popular Deeds to record real estate transactions are:

Quit Claim Deed – transfers any property ownership rights you “actually have” to another party.

Warranty Deed is a type of transfer of property rights you have in a property.

Security Deed is your mortgage or your lender’s right to your property until the mortgage is paid in full.

All of these documents are normally recorded in the “local government authority legal real estate records” office and mailed to you by the closing attorney who assisted in closing the loan on your purchase or refinance.

If the closing attorney’s office doesn’t mail these forms to you (highly unlikely since it’s poor service), both can be obtained by visiting the real estate records office in your community (usually a county courthouse) – for free or small copy fee.

The reason you need to have a copy is to have proof that the deeds exist and you own the property – just in case someone comes knocking at your door and asks you if you really own the property…or the public records get destroyed in fire or flood (yes, it has happened)

One of many articles warning of crooks asking you to pay for a copy of your deed(s) which you already should have anyway

2-20-2015: Colorado legislature is contemplating Bill #15-114 which limits the state’s right to exercise eminent domain for just “open space” and other uses in support to protect private property rights.

11-6-2014: Eminent domain is a process where the governmental authority takes possession of your private real property for “public benefit” of some kind and is supposed to pay you “fair market value” of the property. Inverse condemnation is an offshoot of eminent domain where the property owner sues the applicable governmental authority for condemnation or depriving an owner of its use and value and pays damages.

Some local governments are using eminent domain to take property (with severly underwater mortgages) away from banks or lending institutions at current market value and refinancing the property to the current owner.

4-10-2014: Hey, Maryland lawmakers just passed a bill blocking the use of eminent domain for two years.

update 8-10-2013: Richmond CA wants to be the first to use eminent domain to restructure underwater mortgages and could set the stage or future implementation…Fannie and Freddie would stop buying mortgages where eminent domain is used… Source: http://www.clarionledger.com/article/20130810/OPINION01/308100004/Negotiating-better-than-taking-underwater-housing-market?nclick_check=1

Even though it’s an interesting tact to execute, do we reaally want our local governments with the power to rewrite contract law through eminent domain even when it keeps a homeowner in it if the “price is right”?

By the way, Mortgage Resolution Partners (MRP) has been promoting the plan as a means to allow people to stay in their homes…and MRP would receive a fee to assist in the repackaging of loans seized into new debt instruments sold to investors.

Sources:

http://www.sddt.com/News/article.cfm?SourceCode=20130802fac&_t=If+I+Bribe+City+Hall+Can+I+Reduce+My+Mortgage#.Uf-61su9KK0

WSJ Opinion article “Fighting Foreclosures with Eminent Domain”, page A-13 on July3 2013.

WSJ article on page A6 of 6-21-2012 issue.

According to some Federal Laws instituted during th 2008-2013 financial crisis run, there were two basic tax credits for firt time honmebuyers to stimulatee home purchases:

1. First time homebuyers were offered a $7,500 (married) or $3,750 (single) “refundable” (meaning under certain situations it was to be paid back to the US Treasury in the form of $500/year lower income tax refund or increased payment due) tax credit or 10% of purchase price, whichever was lower. This applied to home purchases between April 9, 2008 and July 1, 2009 (where a purchase contract was signed prior to April 9. 2008).

2. Since the first home buyer stimulus wasn’t very effective in generating new home sales, another $8,000 (if married and $4,000 if single) “nonrefundable” (it didn’t have to be paid back to the US Treasury) tax credit was established that waived (eliminated any possibility of recapture or payback to the US government). This applied to home purchases between December 31, 2008 and December 1, 2009.

SNAFU!

Do you think the IRS has improved since 2010?

The Treasury Inspector General for Tax Administration (TIGTA) found in 2010 that the IRS did not have the ability to identify individuals who received a credit and later ceased using the home as their primary residence.

Do you think they do now?

TREASURY INSPECTOR GENERAL FOR TAX ADMINISTRATION Report in 2012 – During Tax Years 2006 through 2009, taxpayers claimed almost $470 billion in refundable credits. Due to post-refund examinations, taxpayers were required to repay more than an estimated erroneous refundable credits, the IRS plans to were required to repay more than an estimated $2.3 billion in erroneous credits. By the end of December 2011, the IRS had recovered an estimated $1.3 billion—-. While most of these weren’t for home buyer tax credit, there were recommendations made in this report to require “proof of purchase” and not just taxpayer word.

References to products and services are not a specific endorsement, but the user must perform their due diligence and investigate whether the product or service is right for them. I welcome any or all comments that would help others.

In states where mediation of foreclosures through some fashion of legal assistance (judicial foreclosure state,  not a non-Judicial foreclosure state like Georgia), the states are requiring banks to modify loans…About 20 states offer some form of foreclosure mediation.

Some borrowers have complained that the lender transfers them from person to person and the Congressional investigations on Cspan reveal some of the practices.

Over 60% of the people in mediation have received permanent loan modifications.  There was also a reported 1.5 million loan modifications made by the industry – But how many of those modifications were permanent and how many were just for the minimum 3 months to get their fees and setup for another loan modification?

Source: WSJ 12-31-2010, A4 –   http://online.wsj.com/article/SB10001424052748704543004576051843140821936.html?mod=djemRealEstate_h

References to products and services are not a specific endorsement, but the user must perform their due diligence and investigate whether the product or service is right for them. I welcome any or all comments that would help others.