Category Archives for "National"

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

For more information on affordable and available homes in Charlotte NC Metro & Surrounding Areas.

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.

March 8, 2011

Research Firm Says U.S. Housing Has Never Been This Undervalued (DSNews)

The research firm, Capital Economics, has found that housing has never been this undervalued, according to an article by Carrie Bay published in DSNews. The following is an excerpt from the article.

“The continuing depreciation of residential property values at the end of last year has made housing look more undervalued relative to income than ever before, according to analysts at the research firm Capital Economics.

Based on the latest Case-Shiller home price index, Capital Economics’ study shows that in the fourth quarter of 2010, housing was 21 percent undervalued when compared with disposable income per capital.

Looking at data included in the index published by the Federal Housing Finance Agency (FHFA), the firm found that housing in Q4 was 15 percent undervalued as measured against individuals’ disposable income.

Capital Economics says its results illustrate “housing is exceptionally undervalued,” and the gap is getting bigger. In its third quarter 2010 report, the research firm pegged the Case-Shiller index readings as 19 percent undervalued and the FHFA index as 14 percent below what would constitute a balanced housing value in relation to income.

The recent fall back in house prices, coupled with low rates, explains why the initial monthly mortgage payment on a median priced house bought with a 20 percent down payment has fallen to a record low of 13 percent of the median income, Capital Economics pointed out in its report.”

With home prices hitting a new cycle low in 29 states in the fourth quarter of last year housing now appears to be closer to fair value when set against rents.

“Such favorable valuations mean there is plenty of scope for housing to perform well in the medium-term, according to Capital Economics, but over the next year, the firm says the combination of weak demand, high supply, and more forced sales of foreclosed properties will push prices lower.”

With the sharp fall of the mortgage delinquency rate at the end of 2010, there will be fewer homes in the foreclosure pipeline but the increase of defaulted properties still in process means home values will continue to be negatively effected by these distressed properties for a while. In addition to the low prices, mortgage rates have recently been on the decline as well. When you add low mortgage rates into the equation with declining home prices, Capital Economics says, “The incredibly favorable affordability and valuation environment is the housing market’s one big positive.”

Full Article

For information on finding affordable and available homes in the Charlotte Metro and surrounding areas, contact Showcase Realty.

March 4, 2011

DSNews: FHA Commissioner Says Short Refi Program Necessary for Recovery

The following is a portion of an article published by DSNews today, March 3rd, 2011, regarding the short refi program.

“As the House prepares to debate on the future of the Federal Housing Administration’s Short Refinance option, FHA Commissioner David Stevens implored House subcommittee members to give the program a chance.

The program is a voluntary option for lenders to agree to offer principal write downs and restructure loans for underwater borrowers.

With an estimated one-fourth of outstanding mortgages classified as underwater, Stevens says keeping the program alive is crucial to spurring economic recovery by helping to prevent more foreclosures.

“In many cases, providing a principal write down to a borrower is more economically rational for an investor or lender than not doing so,” he said, “as lenders lose significant value when a home goes to foreclosure.”

The program allows investors and lenders to reduce their expected losses while also enabling responsible borrowers to afford to stay in their home.

Stevens said as of February 11, 23 FHA-approved lenders are participating in the program and 245 FHA case numbers have been requested, of which 44 loans have been endorsed.”

Full Article

For more information regarding this and other information on Short Sales, contact Showcase Realty, LLC

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.