Katerina Gasset

Author Archives: Katerina Gasset

DSNews: Nearly Half of Economists See Double-Dip Before Year End

A recent article by Carrie Bay for DSNews published on March 24th, 2011 stated a survey has found that nearly half of economists see a double-dip in home prices happening before year-end. 111 economists and real estate experts were polled and none of them foresee property values recovering for at least five years. The following is an excerpt from this article,

“The survey was conducted by New Jersey-based MacroMarkets, which was founded by Robert Shiller, real estate sage and namesake of the closely-watched Case-Shiller Home Price Index.

‘Overall, the sentiment among our expert panel regarding the U.S. housing market outlook continues to deteriorate,” Shiller said. “Now they are expecting only a weak recovery, and even that is not until 2013.’

Shiller added, ‘This uninspiring view must be influenced by the persistently weak market fundamentals – high

unemployment, supply overhang, an unabated foreclosure crisis, and constrained mortgage credit.’ ”

Just a few months ago, in December 2010, a similar survey showed only 15 percent of economists predicting a double-dip. Terry Loebs, MacroMarkets managing director gives insight in the DSNEws article,

“Loebs believes many more experts are now projecting a double-dip after witnessing what he describes as “the double-dead cat bounce” that came in the wake of expired government stimulus programs, namely the homebuyer tax credits.

The half of the panel that’s forecasting a new low for home values may not be too far off base.

Loebs notes that after weak performance in the last quarter of 2010, actual home prices at the national level are now less than 1 percent away from establishing a new post-crash low, and several firms that conduct regular price studies have already warned that the numbers are edging dangerously close to double-dip territory.”

Full Article

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Only 14% of newly delinquent Bank of America mortgages qualify for HAMP (Housing Wire)

In an article by Jon Prior published in HousingWire yesterday, of 100 Bank of America mortgages that have reached 60 day delinquency sampled, only 14% qualified for the HAMP program. The following is an excerpt from this article.

“The Home Affordable Modification Program came under fire at the end of February from lawmakers claiming it has caused more harm than good. Even those defending the program say it will not reach as many borrowers as originally thought. The House Financial Services Committee will debate a bill aimed at terminating the program two years before it set to expire.

Through January, participating mortgage servicers permanently modified roughly 600,000 loans, far short of the 3 million to 4 million estimated by the Treasury Department when HAMP launched in March 2009.

BofA monitored the 100 loans as they went through the HAMP waterfall. In the first phase, 28 loans fell out of the program because the bank could not get in touch with the borrower, according to a presentation for investors held Tuesday.

“We conduct extensive outreach activity to these including 110 phone calls and eight customized letters,” BofA Executive Vice President Terry Laughlin said, “in addition to door-knocking in hard hit markets and hundreds of outreach events across the country.”

Of the 72 borrowers that did provide financials to BofA, 52 did not pass the HAMP underwriting guidelines. Roughly half of those that did not pass already had mortgage payments at or below 31% of their monthly income. Another 23% did not have enough monthly income to qualify, and 17% did not submit their hard ship documentation.

Then, of the 20 that made to a trial stage, 14 completed the trial process by making three consecutive mortgage payments under the new terms.”

Full Article

For help with HAMP or HAFA contact Showcase Realty.

VA Authorizes Relocation Help for Short Sales and Deeds-in-Lieu (DSNews)

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The following article was written by Heather Hill Cernoch for DSNews:

The Department of Veteran Affairs (VA) has instructed mortgage servicers to pay relocation assistance to borrowers completing short sales or deeds-in-lieu (DIL) of foreclosure on VA loans.

“VA has a longstanding policy of encouraging servicers to work with veteran borrowers to explore all reasonable options to help them retain their homes or, when that is not feasible, to mitigate losses by pursuing alternatives to foreclosure,” according to the circular released by the federal agency.

VA is authorizing servicers to advance $1,500 in relocation assistance to borrower occupants who complete a short sale with a VA compromise claim or who execute a DIL.

The transfer of ownership via DIL or short sale is typically shorter than a foreclosure time period, the VA explained, and the property is left in better condition via DIL. These options can also provide a better outcome than a foreclosure sale for borrowers, investors, and communities.

The amount of the indebtedness reimbursable on a claim after crediting it with the net value of the property (or the short sale proceeds, if larger) is limited to the maximum guaranty on the loan plus the cost of liquidation appraisals. The servicer must waive any amount on the loan not covered by the sum of the VA guaranty claim amount and the greater of the net value or sale proceeds.

VA expects servicers to notify eligible borrowers of the availability of foreclosure alternatives and encourage completion of a short sale or DIL by providing the homeowner with a written agreement describing the requirements for receipt of a relocation incentive. With a DIL, the agreement must specify that the property will be unencumbered by other liens or restrictions on title, it will be kept in good and safe condition, and it will be left ready for sale in “broom clean” condition upon homeowner departure.

For this article, click here.

To see Charlotte-area short sale properties that are available or to speak with a Certified Distressed Property Expert, click here.

HAMP Stats Increase in November with Permanent Mods Topping 500K (DSNews)

The following article is from DSNews.com regarding HAMP Stats Increasing, Published December 22, 2010:

The federal government’s principal foreclosure prevention program has put 504,648 distressed homeowners into permanently modified loans since it was launched in March 2009. Treasury released new numbers for the Home Affordable Modification Program (HAMP) Wednesday, and in addition to crossing the 500K threshold, the data show that servicers stepped up their use of the program last month.

Permanent modifications were granted to 30,000 borrowers in November, 26 percent more than in October. The number of trial modifications started also rose. In November, 31,300 new trial plans were initiated, up about 20 percent from the previous month.

Treasury says servicers are continuing to work through the backlog of HAMP trials that have lasted six months or more. The number of these aged trials has no fallen below 50,000.

According to Treasury’s report, for those borrowers in active permanent modifications, the median monthly savings is $524.41, or 37 percent of the median payment before modification. Aggregate reductions in monthly mortgage payments for borrowers who received permanent modifications are estimated to total $4.1 billion.
Critics of the program, though, point to the fact that at its current pace, HAMP will fall far short of the administration’s goal of helping 3 to 4 million homeowners save their homes from foreclosure. The Congressional Oversight Panel warned last week that “absent a dramatic and unexpected increase in HAMP enrollment…an untold number of borrowers may go without help.” The watchdog group estimates that the program will ultimately help only 700,000 homeowners.

The program has also been plagued with large fallouts, as homeowners in trial plans were unable to stay current on their modified payments or failed to meet program requirements for transitioning to permanent status. Of the 1.43 million trial plans extended, over half have been cancelled. In addition, 45,000 permanent mods have been terminated from the program.

Still, federal officials assert that HAMP has laid the groundwork for more sustainable modifications through servicers’ own proprietary programs and other constructive foreclosure alternative options.

For the full article, click here.
To speak with a professional about assistance with selling or purchasing a short sale home, contact us.