February 2010

Ideas from the front line servicers

Posted on Thursday, February 25, 2010

Paul A. Koches, EVP, general counsel, and secretary of Ocwen Financial Corporation recently issued an interesting letter. Koches' bottom line was that at many servicing shops the overriding financial incentive comes from "adhering to contractual obligations to service the loans, and resolve deli...

Failures and Losses Equal Less New Loans

Posted on Thursday, February 25, 2010

702 banks (holding $402.8 billion) were on the FDIC’s “problem list” and 45 failed as of Q4 2009, 27% more than Q3 2009 (552). Total failures for 2009? 140. Total so far for 2010? 20! In Novemeber FDIC required many banks to prepay 3 years worth of deposit insurance premiums – almost $46 bill...

SIOR Index Results

Posted on Thursday, February 25, 2010

Vacancy rates will trend higher this year and older properties will become obsolete. Hopefully with the job market expected to turn for the better later this year, we’ll see rising demand for office and warehouse space, but probably not until 2011. Consumer confidence could hasten recovery in the r...

Q4 2009 Outcomes and 2010 Predictions

Posted on Thursday, February 25, 2010

Default rates on office, retail, hotel, and industrial loans are up to 3.8% as of Q4 2009 verses 1.6% in Q4 2008. Real Capital Analytics reports: Defaults on multifamily mortgages soared even higher – a staggering 250% jumping from 1.8% to 4.4% There are 8,942 commercial properties in the...

Recessions In Recent History

Posted on Thursday, February 25, 2010

1937 13 months 1945 8 months 1948 11 months 1953 10 months 1957 8 months 1960 10 months 1969 11 months 1973 16 months 1980 6 months 1981 16 months 1990 8 months 2001 8 months Currently December 2007 to present ...

Case Shiller Home Prices

Posted on Thursday, February 25, 2010

According to the latest S&P/Case-Shiller U.S. National Home Price Index, residential property values were down 2.5 percent in Q4 2009 compared to a year earlier, a significant improvement over the annual variances in the Q1 (-19.0 percent), Q2 (-14.7 percent), and Q3 (-8.7 percent) of 2009, and sho...

Negative Equity

Posted on Thursday, February 25, 2010

First American CoreLogic numebrs are indicating 11.3 million plus homes (24% of all homes with mortgages) in negative equity by year end 2009 with another 2.3 million approaching (only 5% equity). This adds up to about $801 billion underwater and theoretically at risk. 3Q 2009 the number was 10.7...

FDIC List Update, Write Downs and Still Not Lending Even Thought CRE Performing OK

Posted on Wednesday, February 24, 2010

Funny how you can pick up any paper today and read two or more articles related to the many indicators we rely on and predicting vastly different recovery time lines, patterns and outcomes. For example, on the one hand, CRE transactions were looking good in December, leading some to at least hin...

The February 10, 2010 Congressional Oversight Panel report on Commercial Real Estate Losses and Ri

Posted on Wednesday, February 24, 2010

The February 10, 2010 Congressional Oversight Panel report on Commercial Real Estate Losses and Risk to Financial Stability includes some noteworthy updates and new information and brings to mind some other factors that should be kept in mind but may not be obvious when considering the state of th...

December 2009 Looked Good But Banks Still Looking Down

Posted on Wednesday, February 24, 2010

Funny how you can pick up any paper today and read two or more articles related to the many indicators we rely on and predicting vastly different recovery time lines, patterns and outcomes. For example, on the one hand, CRE transactions were looking good in December, leading some to at least hin...

FNMA Help

Posted on Wednesday, February 24, 2010

Miami, FL: Fannie Mae has committed to purchase $5 million in loans originated through an anti-predatory initiative that is designed to relieve homeowners in Miami-Dade who have been victims of abusive lending practices. Under the Miami-Dade Predatory Lending Initiative, borrowers whose credit has b...

Home Prices

Posted on Wednesday, February 24, 2010

We see that home prices kept falling but slower than they did at the end of last year; Down 2.5% Q4 2009 compared to Q4 2008. But the 2008 to 2007 number was down 18.2 percent. Month to month prices rose 0.3% from December November 2009 overall in 20 markets, but fell in 5 markets. According...

New Home Sales

Posted on Wednesday, February 24, 2010

According to US Census Bureau numbers released this morning, new home sales in January 2010 were down 11.2% from last month/December 2009 and down 6.1% from last year/January 2009. Last month 3 of the 4 US regions showed a decline in new home sales; 35% down in the NE, 12% in the W and 9.5% in the ...

HAMP Report Card

Posted on Tuesday, February 23, 2010

Mortgage servicers have significantly stepped up efforts to convert trial modifications to permanent status under the administration’s Home Affordable Modification Program (HAMP), nearly doubling the number in just one month’s time. The U.S. Treasury released its January report card Wednesday and it...

The State Foreclosure Prevention Working Group

Posted on Tuesday, February 23, 2010

The State Foreclosure Prevention Working Group was formed in the summer of 2007 with the goal to reduce the number of foreclosures by encouraging loan modifications and other sustainable, long-term solutions. The Group currently consists of representatives of the Attorneys General of 12 states (Ari...

NARs Take on Pending HUD Rules

Posted on Tuesday, February 23, 2010

On HUD's proposed rule to implement the Secure and Fair Enforcement Mortgage Licensing Act of 2008 (the SAFE Act); The SAFE Act requires states to establish loan originator licensing requirements that meet minimum standards. The rule establishes minimum requirements for state licensing, the procedur...

Obama Announces Another $1.5 Billion...Where are the details???

Posted on Tuesday, February 23, 2010

The administration announced a new initiative Friday to help the nation’s hardest hit housing markets. President Obama has allocated $1.5 billion in aid for states where unemployment is high and home prices have fallen more than 20 percent in the aftermath of the housing bubble. Great concept now ...

First Time Buyers

Posted on Tuesday, February 23, 2010

Mark Zandi, chief economist at Moody's Economy.com, says there will be 1.84 million homes sold to first-time home buyers in 2010, compared with 1.73 million in 2009....

Past Performance, Future Predictions

Posted on Tuesday, February 23, 2010

After 13 months of consecutive declines, overall commercial property values climbed 1%, according to the most recent monthly reading by Moody's/REAL Commercial Property Price Index. Estimates published last November by the Urban Land Institute and PricewaterhouseCoopers suggest that commercial real...

Decent Year End Numbers

Posted on Tuesday, February 23, 2010

Its seems commercial prices increased 4.1 % in December. This is a big increase relative to the past 10 years or so and is the second increase in a row. The number of deals also rose…over 75%. And the dollar value of the total deals was also up…a lot. But my personal feeling, and this is base...

New Tool?

Posted on Tuesday, February 23, 2010

A little-known Fed mechanism — referred to as the interest rate on excess reserves — essentially gives the Fed leverage over $1.1 trillion in bank deposits. Most of those deposits were created as the Fed gobbled up mortgage-backed securities and Treasury notes and bonds during the financial crisi...

Predictions for 2010

Posted on Tuesday, February 23, 2010

Nearly 5 million houses and condos, of which the mortgages are delinquent, will go through foreclosure over the next few years, a new study by John Burns Real Estate Consulting Inc. concludes. This represents more than half of the 7.7 million households now behind on their mortgage payments. The ...

2009 Q4

Posted on Tuesday, February 23, 2010

According to MBA’s fourth quarter report, the national delinquency rate for mortgage loans on residential properties has fallen to 9.47 percent of all loans outstanding. The percentage of loans in foreclosure at the end of the fourth quarter was 4.58 percent, MBA reported, an increase from the thir...

2009 Year End Update

Posted on Tuesday, February 23, 2010

At the end of 2009, foreclosures were definitely "in the news." And for good reason. The number of foreclosures rose from 1.8 million at the end of 2008 to about 2.5 million at the end of 2009. This means that 2.21 percent of all U.S. housing units - one in 45 - received at least one foreclosure fi...

Top States

Posted on Tuesday, February 23, 2010

U.S. foreclosures declined 10 percent in January compared to December, but were still up 15 percent year over year, January foreclosure numbers are exhibiting a pattern very similar to a year ago: a double-digit percentage jump in December foreclosure activity followed by a 10 percent drop in Janu...

Center Opening in Miami...a Great Idea to Bring the Help to the People!

Posted on Tuesday, February 23, 2010

Fannie Mae announced Monday the opening of a mortgage help center in Miami to help distressed borrowers in South Florida with loans owned by the GSE. This is a GREAT idea. Up until now, very few people knew when FNMA was coming to town for one of their borrower Q&A’s. We need an office on the Wes...

An Unpdate on the Countrywide Case

Posted on Tuesday, February 23, 2010

Some 16 months after Countrywide Financial reached an agreement with the Florida attorney general’s office to settle one of the biggest predatory lending lawsuits in the nation’s history, restitution is coming for distressedhomeowners. More than 2,700 Countrywide borrowers in the Sunshine State are ...

Short Sales

Posted on Tuesday, February 23, 2010

Short sales accounted for a substantial 15.9 percent of home purchase transactions in January. This was well above the share of other distressed property activity – with damaged REO accounting for 13.4 percent of activity and move-in ready REO making up 13.8 percent. Borrowers that agree to a shor...

Supply and Demand

Posted on Tuesday, February 23, 2010

REOs and pending foreclosures will likely take 33 months – or nearly three years – to clear if liquidation rates hold steady....

Home Sales and Prices Straight From NAR

Posted on Tuesday, February 23, 2010

Strong gains in existing-home sales were the predominant pattern in most states during the fourth quarter, with many more metro areas seeing prices rise from a year earlier, Sales increased from the third quarter in 48 states and the District of Columbia; 32 states even saw double-digit gains. ...

Existing Home Sales and Prices - NAR

Posted on Tuesday, February 23, 2010

According to the latest quarterly statistics released by NAR Research, total state existing-home sales, including single-family and condo, jumped 13.9 percent to a seasonally adjusted annual rate of 6.03 million in the fourth quarter - up from 5.29 million in the third quarter. Existing-home sales r...

Mortgage Interest Deduction

Posted on Tuesday, February 23, 2010

On February 1, President Obama released his budget proposal for 2011. Consistent with its proposed FY 2010 budget, the Administration's again has recommended limiting the value of the mortgage interest deduction (MID) for upper income taxpayers by, in effect, converting the deduction to a 28% tax cr...

FNMA Deed for Lease

Posted on Thursday, February 11, 2010

News Release November 5, 2009 Fannie Mae Announces Deed for Lease™ Program WASHINGTON, DC -- Fannie Mae (FNM/NYSE) is implementing the Deed for Lease™ Program under which qualifying homeowners facing foreclosure will be able to remain in their homes by signing a lease...

CDDs...another opportunity?

Posted on Thursday, February 11, 2010

Investors in Florida’s distressed community development districts are expecting increasing defaults on bonds sold during the state’s real estate boom years. November payments showed a sharp increase in the number of CDDs drawing on debt-service reserves or not paying interest. More than 40%. Ma...

FNMA and Freddie Buy Backs

Posted on Thursday, February 11, 2010

On January 1, 2010, the GSE adopted new industry-wide accounting standards – FAS 166 and FAS 167 – which require lenders to account for certain securitized assets on their own books, rather than passing all the risk off to securities investors as has been the case in the past. It’s a move that regul...

More Thoughts About a Doubel Dip?

Posted on Thursday, February 11, 2010

Finishing the year with five straight down periods, the IAS360 House Price Index was off 5.3 percent for the 12-month stretch. This relatively modest decline follows an 11.7 percent drop in 2008. Now more than 22 percent down from its high-water mark set in July 2007, the index has fallen to a l...

Signs of a dDuble Dip?

Posted on Thursday, February 11, 2010

While residential values in some markets appear to have found their bottom, Zillow has observed that prices in 29 of the 143 markets is tracks have leveled off or begun to decrease again after showing at least five consecutive monthly increases – early signs of what could become a second prolonged p...

Citi Announces Short Term Lease Back Plan

Posted on Thursday, February 11, 2010

Citigroup Inc. plans to let homeowners on the verge of foreclosure stay in their homes for six months - if they turn over the deed to their property. Citi said Thursday it is launching the pilot program, dubbed "Foreclosure Alternatives," this week in Texas, Florida, Illinois, Michigan, New J...

Foreclosures

Posted on Thursday, February 11, 2010

Realty Tracs January 2010 U.S. Foreclosure Market Report shows that foreclosure filings were reported on 315,716 U.S. properties during the month, 1 in every 409 housing units. That's a decrease of nearly 10 percent from the previous month but still 15 percent above January 2009. Last month’s de...

NAR Home Sales States Released Today

Posted on Thursday, February 11, 2010

Strong gains in existing-home sales were the predominant pattern in most states during the fourth quarter of 2009, with many more metro areas seeing prices rise from a year earlier, according to the latest survey by the National Association of Realtors ® . Total state existing-home sales, includi...

Making Home Affordable HAMP Modification Program

Posted on Wednesday, February 10, 2010

In a letter to Treasury Secretary Timothy Geithner, House Committee on Oversight and Government Reform Chari Ed Towns (D-NY)wrote, “… it is my understanding that Treasury has thus far refused to reveal in detail how it defines ‘net present value’, one of the key criteria for homeowner participation ...

Prospect for CRE in 2010

Posted on Wednesday, February 10, 2010

Survey says.... * Forty-three percent of respondents to Jones Lang LaSalle’s annual survey expect their loan production to range from $2 to $4 billion in 2010-a number that is more than double the 21 percent that reported sourcing in this range for 2009. * Showing even more future optimism...

Florida CRE Opportunities

Posted on Wednesday, February 10, 2010

A New Decade, a New Opportunity; Florida's New Frontier for Commercial Real Estate in 2010. It’s no secret that Florida is one of four states that has borne the brunt of the residential real estate bust. As we now move forward into a new decade, a once-in-a-lifetime opportun...

Chnages in the Notion of the American Dream

Posted on Wednesday, February 10, 2010

Housing in America: The Next Decade, a new research paper authored by John K. McIlwain, senior resident fellow of ULI, predicts; * Overall home prices will likely decline an additional 10 percent in 2010. * The growing number of consumers who are choosing to walk away from their mortgages s...

Home Ownership Rates

Posted on Wednesday, February 10, 2010

You can do all kinds of things to get people into a house, which we did; the real problem is making it so they can stay there. You can't magically MAKE an unaffordabel home someone streched to buy with an exotic loan product be affordable. Even if the President of the most powerful nation in the w...

New Proposal for Transparancy at GSEs

Posted on Wednesday, February 10, 2010

Judt Biggert, the ranking GOP member of the House Financial Services Subcommittee on Oversight and Investigations, introduced a bill to improve transparency and accountability within the GSEs. “These institutions have over eight trillion dollars in outstanding securities – about half the nation’s...

new Report Says Prices May Be Stabalizing in Some Markest But not FL, AZ, NV or CA

Posted on Wednesday, February 10, 2010

PMI’s U.S. Market Risk Index measures the likelihood of lower home prices in two years for each of the nation’s 384 metropolitan statistical areas (MSAs). The index uses economic, housing, and mortgage market factors (including home price appreciation, employment, affordability, excess housing suppl...

Pendign Home Sales From NAR

Posted on Wednesday, February 03, 2010

In November, the Pending Home Sales Index (PHSI), a forward-looking indicator based on contracts signed during the month, fell to 95.6, a 16.4 percent decrease from surging activity in preceding months due to the anticipated expiration of the homebuyer tax credit. Following the extension and expansi...

FHFA

Posted on Tuesday, February 02, 2010

The Federal Housing Finance Agency (FHFA) was created on July 30, 2008, when the President signed into law the Housing and Economic Recovery Act of 2008. The Act created a world-class, empowered regulator with all of the authorities necessary to oversee vital components of our country’s secondary m...

GSEs HAMP Mods

Posted on Tuesday, February 02, 2010

Under the administration’s HAMP, the government-sponsored enterprises (GSEs) initiated more than 485,000 mortgage loan modifications through December 2009. Of these, 43,000 were HAMP permanent modifications, and 442,500 were active trials. Completed loan modifications declined to approximately 7,0...

TARP and the President's Budget

Posted on Tuesday, February 02, 2010

The president’s budget plans would impose a levy on all financial institutions with more than $50 billion in assets. The administration has calculated that fees taken from these banks would yield $9 billion a year over the next 10 years, and up to $117 billion within 12 years if necessary to ensure ...

At a recent conference...

Posted on Tuesday, February 02, 2010

Prudential representatives were heard explaining the company had $4 billion to deply this year, mostly with loan over $10 billion in primary areas. Everyone seems to be going after that sa,e type of assets; stable properite,s not construction loans so popular during the boom years. Most agree...

FNMA and Freddie Buy Banks

Posted on Tuesday, February 02, 2010

Between them the GSEs have an estimated $300 billion in single-family home loans that are at least 90 days past due, the Wall Street Journal reports. And their teams of auditors are working overtime to weed through the files and pinpoint underwriting missteps or income discrepancies that would warra...

FNMA Supports Multi Family

Posted on Tuesday, February 02, 2010

News Release February 01, 2010 Fannie Mae and its DUS® Lenders Invest $19.8 Billion in 2009 to Fortify the Multifamily Rental Housing Market Fannie Mae remains a constant source of liquidity and stability WASHINGTON, DC - Fannie Mae (FNM/NYSE) today announced that the company, ...

Discussed at a Recent FNMA/Freddie Outreach About MHA...

Posted on Tuesday, February 02, 2010

There is a daily exchange between the Treasury and FNMA as administrator of MHA, in particular the FNMA group dedicated to servicing, vis-à-vis a 9 AM conference call that typically lasts about an hour. FHA has it’s own separate HAMP program. Lenders and servicers also have their own current loss ...

Servicing - Recent Stats

Posted on Tuesday, February 02, 2010

Topping the list of U.S. master and primary servicing was Wells Fargo/Wachovia Bank with $473.8 billion, followed by PNC Real Estate/Midland Loan Services with $322.9 billion, Berkadia Commercial Mortgage with $217.9 billion, Bank of America Merrill Lynch with $131.7 billion, KeyBank Real Estate Cap...

Less Paperwork?

Posted on Monday, February 01, 2010

The Treasury Department is announcing a plan Thursday to reduce the burdensome paperwork surrounding the foreclosure relief plan. Two changes expected to make a big difference are: Lenders will be required to collect two pay stubs at the start of the process. Borrowers will be required to g...

Freddie Trying To Reach Borrowers

Posted on Monday, February 01, 2010

Freddie Mac and 13 national and local nonprofit organizations have launched a pilot effort aimed at convincing discouraged delinquent borrowers to pursue mortgage workouts to save their homes from foreclosure. ...

Deficiency Judgments

Posted on Monday, February 01, 2010

Increasingly aggressive mortgage lenders are seeking to collect deficiencies from former home owners who walked away from their properties or sold them in short sales. Many states, including Florida, give mortgage holders as long as five years to seek a deficiency judgment. If granted, the bank g...

FNMA Offer to Buyers...

Posted on Monday, February 01, 2010

Fannie Mae is offering a 3.5% incentive for buyers who purchase and close on a Fannie Mae-owned home between January 28 and April 30, 2010. Buyers purchasing properties listed on HomePath.com that are closed within this period may receive up to 3.5% of the final sales price for: · Cl...

Where the Deals Are

Posted on Monday, February 01, 2010

Nationwide, only 87 markets are in the overvalued category, according to a newly released 2010 report compiled by IHS Global Insight and PNC Financial Services. That means 242 of the 299 largest U.S. housing markets are selling for prices that even bankers think are less than fair market value. T...

NAR Post On HAMP and HAFA

Posted on Monday, February 01, 2010

TIMELINE Notification If a servicer has not already discussed a short sale or DIL with the borrower, it must notify the borrower in writing of these options and give the borrower 14 calendar days to respond, orally or in writing. If the borrower does not respond, that ends the servicer’s duty to g...

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