No $ No Help For Housing

As the Obama administration and Congress continue to plays politics with the American economy it is apparent that there is no money for any new government program aimed at helping the millions of Americans now facing foreclosure or the millions owing more than their home are worth.



Recently during a Twitter town hall,the President acknowledged that the weak housing market was one of his administrations chief burdens.

According to many economists, the fact is that there isn't likely to be any money or political desire to consider any legislation to address the problem.

In my opinion housing remains one of the biggest drags on the American economic recovery. Solving the housing and employment crisis together could have gone a long way toward avoiding the current standoff in Washington over raising the debt ceiling.

Isn't the reason America is at risk of default on it's debt simply because the administration relies too heavily on borrowing. Haven't they borrowed us into a corner while bailing out large corporations that they've considered too big to fail.

How can our government do so much in so little time, sometimes overnight for others while they stand and watch the American consumer struggle daily with higher food prices, continued rising oil prices, foreclosure, unemployment, out of control health care costs.

Most foreclosure now are caused by economic conditions and not by sub prime mortgages. Unemployment may be the biggest contributor to the foreclosure rate and underwater loans may be the second factor. The foreclosure rate continues to climb nationwide with virtually no end in sight. In fact we may now be living our futures.

The only way that could change would be for lenders to reduce the principal owed on both first and second mortgages in order to coincide with current market values. Lowering the principal would give people a ray of hope that they may again someday have some equity in the homes that they've struggled to keep. It would allow others to sell at market prices avoiding any possibility of foreclosure and it would make the nightmares of short sales go away.

While the politicians posture over how much more to borrow and Americans wonder what will happen to us if Washington fails us again the problems facing the economy go unattended, ignored and left to work themselves out.

I have little faith that our government will do what's right for the us, I have great faith that if left to what once was middle class Americans we would find our own way and someday get our country back on track.

Mortgage & Foreclosure Fraud Crackdown

From foreclosure frauds to subprime shenanigans, mortgage fraud is a growing crime threat that is hurting homeowners, businesses, and the national economy. From industry insiders to straw buyers, nearly 500 people have been arrested in a nationwide mortgage fraud takedown that reflects the coordinated efforts of law enforcement to address the growing problem of crime in the housing industry. The FBI has initiated it's largest mortgage fraud takedown to date with "Operation Stolen Dreams"

“Mortgage fraud ruins lives, destroys families, and devastates whole communities,” Attorney General Eric Holder said at a press conference to announce the results of “Operation Stolen Dreams.” Launched on March 1, 2010, the multi-agency initiative has led to a total of 485 arrests. More than 330 convictions have been obtained, and nearly $11 million has been recovered. Losses from a variety of fraud schemes are estimated to exceed $2 billion. The FBI is currently pursuing more than 3,000 additional mortgage fraud cases, almost double the number from last fiscal year.

The numbers are staggering and even more surprising given the difficulties of legit buyers in obtaining any mortgage financing.




George Sinacori
GES Real Estate, LLC

An Unrecognizable Housing Recovery

Normally lower home prices would be good for any housing recovery and good for first time or move up home buyers.

Home sales data indicate an upward tick after 2010, the worst year of sales in a decade. Any momentum however is not coming from the typical homeowner but from cash rich investors who are snapping up foreclosed and distressed properties at bargain prices. Homeowners or first time buyers crucial to sustaining a recognizable housing recovery are not a market force.

While the number of first time homebuyers has declined, all cash deals have increased, accounting for one third of all home sales in January 2011. A record number of foreclosures have continued to depress prices. The median sales price of existing homes in January fell to it's lowest level in 9 years. Lenders are requiring much tighter lending standards and higher down payments from borrowers searching for financing. In most cases the average requirement is 20% down with perfect credit. The inability to find available conventional financing results in fewer buyers shopping for homes and fewer sellers putting existing homes on the market in order to upgrade.

Cash rich investors are only interested in properties at risk of foreclosure or already foreclosed. They can aquire them at bargain basement prices. The average blue collar worker or first time home buyer can't take advantage because they cannot get the credit needed to buy. A major barrier for the first time homebuyer, preventing many from buying even when the median price fell to it's lowest in many years.



A record number of coming foreclosures or "shadow inventory" still loom large over the next 2 years. As prices continue to decline any housing recovery as we know it will also fizzle out. Supported only by cash we may never recognize or look at the real estate market in the same ways we had. Housing may be becoming a cash commodity for those who are willing to play and gamble. Banks obviously are not playing anymore.
George Sinacori
GES Real Estate

Foreclosed Family Reclaims Home

Former homeowners reclaim foreclosed property:
VENTURA, Calif. – Oct. 18, 2010 – One possible outcome of the foreclosure crisis could be a fight between former owners of foreclosed homes and lenders. An example of what might become a larger trend happened in California, where a couple and their nine children used a crowbar to break into their former home. Their lawyer recommended that they take this step, according to AOL’s HousingWatch.com.
The former owners, Jim and Danielle Earl, say they were trying to catch up with their payments when the lender sold the property to Conejo Capital Partners. Many Realtors will find this very familiar scenario happenening to clients every day.

The Earls say it’s unclear who actually owns the loan. Reportedly the original lender was Washington Mutual, which became JPMorgan Chase. The Earls say that Chase failed to properly assume the loan and didn’t have the right to sell it, nor could Conejo Capital Partners legally sell it.

According to the Earls’ attorney, “They may claim we’re violating the law and we’re claiming they violated the law. Typically, the authorities will say this is a civil dispute, but the question is, who owns the home? Because whoever doesn’t is trespassing.”

Source: The Wall Street Journal, Emily Peck (10/13/2010)

Florida Foreclosure Mills Under Investigation

August 15, 2010
In a bombshell announcement earlier this week, Florida Attorney General Bill McCollums office announced that they have begun investigations into at least several of the largest foreclosure law offices in the state for allegedly submitting false required documents to the courts in order to speed up foreclosures. The law firms, known more appropriately as "foreclosure mills" which have been served with subpoenas are accused of widespread falsification of documents and fraudulent unfair and deceptive trade practices. These firms represent many of the largest lenders in the country and file thousands of foreclosures actions every month. Some have indicated that the unlawful practices are even nationwide.

Under investigation are:
- Law Offices of Marshall C. Watson, P.A.
- Shapiro & Shipman, LLP
- Law Offices of David J. Stern, P.A.
- Florida Default Law Group

Many mortgage loans are bought and sold over and over in "credit swaps". The original or executed notes and assignments must accompany the foreclosure filing in order to obtain a "Final Judgement" by the courts which is basically a foreclosure. The apparent inside joke has been that these documents may never be found at all and fraudulent documents are created in order to accomplish or just speed up the process. The foreclosing lenders and their representatives typically will manufacture whatever may be required knowing that most borrowers have no representation and will never contest the action. A foreclosure can be stopped or delayed by a judge until the proper documentation is produced. Some judges have dismissed foreclosure actions because of false or questionable documentation by the attorneys filing the foreclosure. Widespread reports by attorneys representing borrowers and the courts have finally moved the Attorney General to open an investigation.

Based on the broad scope and the overwhelming evidence of fake documents being submitted, judges should now have no confidence in any of the documents presented to them by these foreclosure mills. Furthermore, in my opinion, this exhausting race to foreclosure should slow to a point where borrowers are actually allowed a legitimate opportunity to accomplish a short sale or some other type of foreclosure alternative.

Homemade Mortgage Modification

An amazing phenomenon is occurring in households all across the nation. Growing numbers of people today are providing themselves with there very own homemade mortgage modifications. This type of financial remedy doesn't beg a lender for permission. With lenders and loan servicers either unwilling or simply not capable of helping with loan modifications, borrowers are just not paying and offering ultimatums. Lenders are being told either help me stay or force me out.

According to statistics published by LPS Applied Analytics, a company that provides services to many of the nations largest banks and financial institutions, the average borrower currently in foreclosure is delinquent some 438 days before being evicted. More than 650,000 households have not paid anything in 18 months and of those the lender hadn't even begun to take any action against nearly 20%. The numbers are staggering. The NY Times reports that 1.7 million foreclosure procedures have been initiated as many borrowers are choosing not to pay for something that isn't worth even half of what they owe on it. Any moral qualms are quickly dismissed by the belief that the banks created the situation and maybe now it's payback time.

Call it self preservation, selective foreclosure, or whatever term suits the situation. The fact remains that people are beginning to take charge of their own lives while lenders continue looking for ways to minimize losses. In some states lenders can pursue foreclosure outside the courts which can be a speedier process. In states like Florida, New York and others, judicial foreclosure is required. This slows the process considerably. Lenders seem to be more willing to allow time for some sort of alternative like a short sale in these states and generally, given the numbers on the horizon, may be reluctant to take many properties back at all.

For more info on foreclosures,short sales, buying or selling a property in SE Florida call me directly at 561-306-6736 or email ges.rellc@ymail.com
www.ges-realty.com

Foreclosure Trends in Palm Beach County

In today's housing market it's no secret that Florida ranks among the top states in foreclosure activity and in property value decline. After a year of government spending, bailouts and intervention that distinction remains unchanged. Last month Florida received the 2nd highest amount of new foreclosure filings nationally, second only to California. Other than steep declines in home values and drastically reduced sales activity little else has changed in the Florida housing market through 2009. Although the new year promises a (different) housing market, current foreclosure trends indicate that the pace of foreclosure activity will continue.

Information obtained through RealtyTrac shows that foreclosure filings over the past 2 months in Palm Beach County, FL have increased. County wide, home prices have declined since June and apparently remained unchanged since September. RealtyTrac reports that 18,096 homes in Palm Beach County received some form of foreclosure filing. Interestingly the greatest value or savings as indicated by foreclosure sale price to average sale price was in Boca Raton where sales trends indicate an average sale price of $244,300 while average foreclosure sale price was $164,750. A difference of 34-35%.

Changes in the short sale process (selling a property for less than what's owed) now scheduled to become effective April 2010 may help some homeowners. Legislation has already been passed simplifying the short sale process by requiring lenders to make the application process uniform from lender to lender thereby reducing the time involved in closing a short sale and hopefully making them a bit more appealing to a ready, willing and able buyer. Many would be buyers shun short sales due to the lengthy process and lack of response by lenders to short sale requests, although when properly submitted the process does work.

If you or anyone you know are interested in buying or selling a property in South East Florida please call 561-306-6736 or email me for a no obligation discussion of todays foreclosure market and the short sale process.

Lenders Fail to Modify Homeowner Loans

Politics and corporate greed continue to eat away at the hearts and wallets of American homeowners and the American dream.



According to Bankrate.com just 2000 homeowners have received loan modifications beyond the typical 3 month trial period nationally in the 7 months since the administration issued it's guidelines to lenders in order to help homeowners avoid or avert foreclosure. That equates to approximately 4 successful modifications per month per state. Lenders will typically stall short sale efforts simply because they can't see beyond dollars and cents. If the Bankrate.com information is correct they have danced around and away from folks asking for modification assistance and the Fed isn't concerned.



The Obama administration's claims of 500,000 homeowners being helped may be little more than political grandstanding again at the expense of homeowners who have been brought to their knees financially leaving many without any other recourse but to eventually walk away and try starting over somehow.



If you need help or have question regarding todays real estate and mortgage markets in SE Florida please call me directly 561-306-6736 or email your questions to rebuygeorge@yahoo.com Find more information about the SE Florida Real Estate market at GES-Realty.com

Lessons In Defining the Next American Dream

Housing prices peaked 40 months ago in May 2006. What have we learned from the great housing bubble and crash ?

Obviously, we have learned that housing prices can be extraordinarily volatile. No one can ever again say foolish things like housing prices never fall. People who bought with a standard mortgage in the years close to the boom have lost all of the equity in their houses. Buyers and lenders should never again think that an area’s recent price increases are the sign of a strong market where prices have nowhere to go but up. In the long run, price increases are followed by price drops, and caution needs to be taken in booming markets.

The second lesson of the housing debacle is that there is extraordinary pain in both housing busts and booms. When housing prices soared, ordinary Americans found it increasingly hard to afford a house. During the boom, many hoped that housing prices would stop rising and even decline, not understanding the terrible impact that declining housing prices would have. Large swings in housing prices, can be extremely painful.

The third lesson is that the response to the American housing crisis has been incredibly foolish. We've used public resources to encourage ordinary Americans to bet all they could on the housing markets. We have allowed billions of tax payer dollars to bail out of firms that had lost on those mortgage gambles. We continue to provide billions of tax payer dollars to the same institutions that were instrumental in creating the bubble that burst what once was the American Dream.

All of these "lessons " leave me wondering what the next American Dream will be.

Perhaps a much less volatile, more comforting lifestyle with a reassurance that we live in a country that cares for it's citizens emotional, financial and physical well being. That the people we've put in charge are truly capable of handling those responsibilities. That we the people and our families are the beneficiaries and not the victims of big business and big government.

For more on today's housing market call 561-306-6736 or email rebuygeorge@yahoo.com

Short Sale Failures Frustrate Sellers

Home sellers are as frustrated as Realtors when the deal involves a short sale, as most home sales do these days. A recent survey revealed that only 23% of short sale contracts actually get to close. Although buyers come pre approved for financing and prices are market value, a host of problems still plague the short sale process. Rapidly falling appraised values due to neighborhood foreclosures combined with the snail like pace of lenders processing short sale packages are the heart of the problem (in my opinion).

Delays by lenders allow impatient buyers to walk away while values deteriorate to a lesser price than contracted for. A more efficient system may in fact reduce pending sale times with a more workable window and help to hold sales together. Short sales, after all should be seen as a way to prevent foreclosures and related costs to lenders. It's frustrating that with a way to avoid those costs many wind up in foreclosure anyway as a result of prolonged waiting periods. many lender delays are a result of insufficient staff and a lack of short sale experience and processing systems. Delays may also occur as a result of Realtor inexperience in submitting documents or informing buyers and sellers of the length of time involved.

Some lenders are considering or at least examining ways to shorten the process and short sale approval time by getting BPO's (appraisals) and setting bottom line prices in advance of a contract. Ideally this lets a seller and realtor offer a property for a price that has already been accepted by the lender. The Treasury Dept. expects to provide lenders with a standard set of documents as well along with added incentives to help move the process along. Both steps in the right direction and an inevitable step in the evolution of home selling. More and more short sales are becoming the standard for home selling. The need for expeditious systems is now.

If you're trying to sell or buy a home please call 561-306-6736 or email me for more valuable information. Go to GES Realty.com for any real estate searches or click the link in the left margin to search properties.

Banks Accused of Delaying Foreclosure

Are banks holding back foreclosures and creating a false or temporary market bottom? According to a July 24,2009 article in the Miami Herald some analysts believe just that. Inventories of foreclosed and short sale homes have dramatically declined over several months as banks have been less inclined to take back more properties. For example, typically in Florida a judicial foreclosure filing takes approximately 6 months. Presently that time frame is more likely to be a year or longer.
I believe that banks are ill equipped to handle this new market of foreclosures and short sales. They don't have the personnel or the resources to actually take a property over and than turn it around quickly to market and sell. That being said it would seem more beneficial to not take on any more than they can handle. It's important for banks to exhibit a healthy or sustainable bottom line these days. Taking in non performing assets like an avalanche of foreclosed properties would not project the image that they need under the scrutiny of the Fed. It only makes sense that they should delay taking these properties back.
How about short sales? Would it benefit banks to process short sales faster than they have? If my analogy is right it seems that may be a good next step. If I have an asset that becomes a liability I sell it if at all possible. I think most people would unless there were some type of emotional connection to it. Why then, if banks are dragging there feet on foreclosures wouldn't they streamline the short sale process and rid themselves of the liability? Is it greed plain and simple? Maybe they're just not that sharp after all.
For more info and recent statistics email me or call me directly 561-306-6736 . Visit my website for info on buying, selling, tax credits, available foreclosures, short sales and existing homes.

Foreclosure Trends in Southeast Florida

While the economy continues to struggle, home prices are still falling under the pressure of foreclosures and short sales. Here in Florida a staggering 11% of home loans are in some stage of foreclosure ranking it first in the country for defaults. With home values continuing to fall the foreclosure rate will surely increase through this year. Prices can't stabilize until the oversupply is at least equal to the demand. According to information provided by Zillow.com approximately 71 percent of homeowners in two Southeast Florida counties who purchased homes in the past 5 years are underwater or owe more than the home is worth. Lenders are finding that loan modifications aren't working as many borrowers fall behind again within a year of the modification. These are borrowers who may have escaped the foreclosure process but will return given time. According to information provided by RealtyTrac, preforeclosures still account for the largest piece of the foreclosure pie. This is the time that lenders, sellers and buyers should recognize as opportunity and take advantage of. This is the time to short sell and avoid the whole foreclosure mess.

The pie chart above indicates current foreclosure trends in Palm Beach county. Of almost 15,000 homes county wide in the foreclosure process 89% are in the preforeclosure stage. That of course does not mean that they will all be foreclosed or that they are all currently for sale. What it does mean is that there are still a lot of homes that need to be sold at current market prices.

Statistics provided by RealtyTrac over the most recent 2 quarters show that the largest decline in values in the county occurred in Boynton Beach and Stuart respectively while the lowest average foreclosure sales price was in Delray, West Palm Beach and Boynton. The total number of foreclosures sales in the county was up slightly in April. The greatest value being in a 3 bedroom home between $100K and $200K. These show the largest decline in price and the greatest number of available properties.

Being aware of market trends has always been important to anyone considering buying or selling a home. Today it's more important than ever. Understanding price trends can make or break a buyer. Current sales trends and the short sale process is key to a seller looking to get their life and finances back on track. Lenders need to streamline the process if they expect to minimize the loss. Todays market is primarily a short sale market and will be for the foreseeable future. The real estate market today is complicated. Buyers and sellers need good, solid, trustworthy information from an experienced reliable source before getting into it.

I encourage anyone in South Florida needing assistance with the process to call me at 561-306-6736, email me your questions or go to ges-realty.com for more information..

Is Housing Nearing Bottom?

May 2, 2009 - As the housing market slowly moves closer to bottoming, rates on 30 year fixed rate mortgages tied a record low this past week.
Average rates on the 30 year fixed rate mortgages fell to 4.78%. A year ago average rates were 6.06%. A considerable difference for any borrower. A new 30 year fixed rate mortgage taken today could mean a savings of $165 monthly or close to $2000 a year.

Inventories are dropping as homes have become more affordable. Recently inventories of single family homes month to month in certain areas of South Florida that I like to watch closely have declined by 30% or more.As availability declines and prices begin to stabilize, lower more affordable mortgages are attracting more buyers.

Some REO or bank foreclosure inventories still not showing on the market could stall the momentum as lenders again begin to process and place foreclosed inventories on the market. It's my belief that once a bottom is recognized these lenders will indeed flood the market with inventories, creating another round of competition between sellers, albeit on a more even playing field, where pricing is key.

If rates remain low and prices bottom, affordability would than be more related to individual incomes, credit and employment stability. Housing may very well be near bottom. The underlying question may now be - will other economic conditions recover or lag behind housing?

Taxpayers $700,000,000,000 Handout

"Wall Street" has never translated to "housing". Try as they may to make them synonymous it isn't so just because someone says it is or want us to believe it. Looking at the players in the current economic debacle, this madcap comedy of errors, I'm reminded how much the Secretary of the Treasury and the Chairman of the Federal Reserve emulate a classic cartoon comic strip of old. Cartoonist Jeff Fisher's characters Mutt and Jeff were business men, almost smart enough to be con men. Mutt was tall and lanky, slightly bent forward while Jeff, his partner, was shorter, a stockier physical makeup and balding with a mustache and beard. I'll give you a moment here to visualize. OK! See any similarity yet? If not here's a link to Mutt and Jeff. Almost uncanny I think.

These two energetic little lunatics were always looking for the easy way to get something. They would attempt the craziest most hair brained schemes and act on them, believing that they couldn't or wouldn't fail. Mutt and Jeff were always surprised to be tossed on their butts, from wherever they were trying to sell their junk by much more sane level headed people.

Our Treasury Secretary and Chairman of the Federal Reserve however have achieved what the fictional Mutt and Jeff only aspired to. They've somehow convinced the most advanced, most sophisticated and supposedly most intelligent government in the world that they need $700,000,000,000. Is that enough zero's? Congress is busy running around convincing each other to vote one way or the other. The House and Senate have each already voted, one no and the other yes to give. What they've forgotten is that the real issue with the economy is still housing. How does Wall Street translate to housing? I just don't get it. A recent First Time Homebuyer tax rebate has not stimulated people to buy houses. A $300,000,000,000 FHA initiative designed to help refinance "troubled mortgages" has done little. Although that was made available only last week I don't see any rush on FHA refinancing. Federal takeovers of both Fannie Mae & Freddie Mac have cost us tens of billions of dollars and still banks and industry giants continue to fail under multi million dollar leadership.

Corporate greed, corruption and politics as usual have put us all on the edge of our seats waiting to see or hear whether or not Mutt & Jeff have made the ultimate score. A taxpayer handout to rescue Wall Street. What happened to rescuing housing? The aforementioned Homebuyer Tax Credit, FHA plan and Corporate bailouts were all initiatives of our Treasury and Fed leaders. These guys weren't thrown out like Mutt & Jeff, they just haven't worked. Hey here's another hair brained scheme. Give them $700B to try to bail out Wall Street. It may not work but heck if you guys are in a giving mood and your pockets keep getting deeper give it up. No guarantees, no need for oversight or regulation, Mutt & Jeff will let you know when it fails. In the meantime Mr. and Mrs. Taxpayer keep watching and keep waiting. Something good may happen someday.

Like the more sane, level headed business minded people that kept throwing Mutt & Jeff out on their backsides, I want to remind everyone of a little word seldom used anymore when it comes to doling out billions of dollars in response to tantrums born of greed and overindulgence.

Just say NO. Say no to the Wall Street power brokers, say no to the corruption, say no to the partisan politics that have lead us to a dark place in our country's history and say No to any more Mutt & Jeff like schemes. Let the corporations and their overpaid CEO's wallow in not being rescued by taxpayers. Let's get the ball back on the court and concentrate efforts on straighten out the housing crisis.

Push the First Time Homebuyer Tax Credit, pressure banks to employ forbearance efforts for troubled borrowers, move forward with the already in place FHA reforms that as of Oct. 1 are available, and let's take a long look at the arbitrary actions of HELOC lenders in capping or eliminating lines of credit in order to accommodate their own selfish greed.

Mutt & Jeff my answer is NO !

How To Price A Short Sale

Pricing a short sale in order to get a response from the lender is key to bringing the seller, lender and buyer to a successful closing.

Facilitating a short sale requires that the facilitator understand the various guidelines that lenders use. Each lender may have there own unique requirements but there are some guidelines that are consistent from lender to lender. Without being able to obtain a counter offer from the lender a short sale attempt will never go any further than the initial offer.
That being the case the initial offer needs to be good enough to generate a counter offer.
Lenders rely on appraisals or BPO's (Brokers Price Opinion) in order to determine the value of a property and an offer. If the offer is considerably less than the BPO the lender may not respond at all and has no obligation to.

So, the initial offering price is critical to facilitating a successful short sale. How you get to a price that will generate an offer from a buyer and generate a counter offer from the lender is a challenge. Lenders take time to obtain information before making a decision. The lender is dealing with accepting a loss. The more of a loss the lender endures the longer that process will take. So be prepared for a long wait. If the offer is within range of the BPO or appraisal the lender is much more likely to respond with a counter offer that they can live with.

It is absolutely essential that the facilitator of the short sale be present at the appraisal or BPO. This is where the value that the lender is going to rely on is determined. The appraiser should be made aware of the circumstance if they aren't already. Any deteriorating physical neglect or anticipated expense required to resell the property should be brought to the appraisers attention. Lenders will look at these things as marketing expenses and may be more inclined to move the property before foreclosing in order to avoid repair costs.

Having someone knowledgeable in the short sale process facilitate the short sale is the most important part of the process. If you need help or more information on todays short sale process please contact me directly at 561-306-6736 or just send me an email with your question.

George Sinacori rebuygeorge@yahoo.com