Foreclosures Plunge in U.S. Recovery; Stocks Fall
(Bloomberg) — Jane King summarizes the top stories this morning (May 17) on the Bloomberg Business Report.
Mortgage Delinquencies Drop
CNBC’s Diana Olick reports a drop in new mortgage delinquencies last quarter and are finally back to the historical long-term average of around 3.1%.
Foreclosures Fall to Lowest Level Since 2007
By Les Christie @CNNMoney
NEW YORK (CNNMoney) — Foreclosure filings in April fell for the third straight month to the lowest level since July 2007.
Total foreclosure activity for April, including default notices, scheduled auctions and bank repossessions, was down 5% from March, according to RealtyTrac.
Bank repossessions declined significantly — there were 51,415 repossessions last month, down 26% from a year ago, and about half the 102,000 monthly repossessions at the peak in September 2010.
House Passes Bill Preventing Foreclosures
By Associated Press
The Massachusetts House of Representatives has passed a bill that would establish standards to protect loan borrowers from unnecessary foreclosures.
State representatives passed a modified version of the proposed legislation Wednesday. It now goes to the state Senate.
Attorney General Martha Coakley proposed the measure, designed to block foreclosures by requiring loan modifications when it is in the financial interest of the borrower and the lender.
Tags: avoiding foreclosure in ma, foreclosure prevention programs, loan modifications in ma
Mortgage Settlement Windfall May Be Diverted in Some States
By Teke Wiggin, AOL Real Estate
Homeowners who welcomed the recent “robosigning” settlement while thinking that it might offer them some relief on their “underwater” mortgages may see those funds diverted for other purposes in nearly half of the states involved.
The $25 billion settlement over illegal foreclosures that was reached between state attorneys general, federal agencies and the nation’s five largest banks was trumpeted as an agreement that would bring significant relief to many of the nation’s beleaguered homeowners, who have watched their home equity vanish during the housing downturn.
But while the majority of that money will flow to homeowners in the form of mortgage modifications paid for by banks, some of a $2.5 billion cash penalty allocated to states may not be used for housing relief, The New York Times reports.
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Bank of America Offering Up to $30,000 for Short Sales
By Les Christie @CNNMoney
NEW YORK (CNNMoney) — Bank of America is offering some struggling homeowners payments of up to $30,000 if they sell their homes in a short sale and avoid ending up in foreclosure.
Under the plan, Bank of America will offer homeowners so-called relocation payments of between $2,500 and $30,000 if they sell their home in a short sale. In short sale deals, the sale price of the home is less than what the seller owes the bank.
The bank first tested the payments in a pilot program in Florida last fall. Under that initiative, Bank of America paid up to $20,000 to borrowers who sold their homes in short sales.
Tags: alternatives to foreclosure in ma, avoiding foreclosure in ma, ma short sale
Freddie Mac to Eliminate Fee on Deeply Underwater Loan Refis
By All Yoon, The Wall Street Journal
In the latest bid to help homeowners hit by the housing crash, Freddie Mac, the U.S.-supported mortgage giant, is set to drop a fee associated with refinancing deeply underwater loans.
The firm plans to eliminate a fee of 0.5 percentage point, called a “cash adjustor,” on loans refinanced under the Home Affordable Refinance Program with balances greater than 125% of the property’s value, said Paul Mullings, a senior vice president at Freddie Mac. He spoke at a Mortgage Bankers Association conference on Monday.
Dropping the fee represents the latest sign that the government-sponsored enterprises and their regulator are determined to extend the reach of the refi program. Changes last year eliminated the loan-to-value cap and relieved banks of some liabilities that could arise with homeowners willing to default.
Tags: Home Affordable Refinance Program in MA, housing crisis in ma, ma mortgage refinance, strategic mortgage defaults in ma, underwater loans in ma
Bank of America Starts Mortgage Reduction Effort
By Natasha Singer, New York Times
Bank of America has started sending letters to thousands of homeowners in the United States, offering to forgive a portion of the principal balance on their mortgages by an average of $150,000 each.
The reduction for qualifying homeowners could amount to monthly savings of up to 35 percent on mortgage payments, Bank of America said in a news release on Monday evening.
The principal reduction offers from Bank of America Home Loans are the result of a $25 billion settlement agreement earlier this year with 49 state attorneys general as well as federal authorities who had been investigating allegations of abuses over the handling of foreclosures.
Tags: avoiding foreclosure in ma, mortgage modifications in ma, mortgage principle reductions in ma, underwater homeowners in ma, underwater loans in ma
Mortgage Delinquencies Hit 3-Year Low
By Credit.com
The rate at which consumers are behind on their mortgage payments by 30 days or more slipped in March to the lowest levels seen in more than three years.
The total value of all mortgage payments that were at least 30 days delinquent slipped to less than $500 billion in March, a level not seen since January 2009, and there were 49.5 million outstanding first mortgages during the month, according to the latest statistics from the credit reporting agency Equifax and Moody’s Analytics. The latter number was a drop of close to 11 percent from the more than 55 million observed in March 2008.
Look Who’s Pushing Homeowners Off the Foreclosure Cliff
By the Editors, Bloomberg
One of the more confounding aspects of the U.S. housing crisis has been the reluctance of lenders to do more to assist troubled borrowers. After all, when homes go into foreclosure, banks lose money.
Now it turns out some lenders haven’t merely been unhelpful; their actions have pushed some borrowers over the foreclosure cliff. Lenders have been imposing exorbitant insurance policies on homeowners whose regular coverage lapses or is deemed insufficient. The policies, standard homeowner’s insurance or extra coverage for wind damage, say, for Florida residents, typically cost five to 10 times what owners were previously paying, tipping many into foreclosure.
Lew Corcoran
Licensed Real Estate Professional
Certified Short Sale Guide
REO Asset Professional
