The foreclosure process in the US is slowing, enabling delinquent borrowers to stay in their homes for months after they stop making mortgage payments, according to one of the largest lenders.Freddie Mac, one of the two government-owned entities that finance about half all US mortgages, says that homes are taking as long as eight months to work their way through its foreclosure pipeline, two months longer than was typical before the housing crisis began.
The delay is the result of more borrowers staying in their homes for months after foreclosure proceedings have begun, requiring Freddie Mac to evict them before it can put those homes back on the market.
Fannie Mae, the other government-owned mortgage finance company, declined to say how long its process took.
A record number of foreclosures is contributing to the slowdown, but so are mounting legal questions surrounding bank procedures to repossess homes from delinquent borrowers. Some 6.7 million homes are either in some stage of delinquency or foreclosure, and nearly 30 percent of all home sales are of distressed properties, according to Core Logic, a real estate data tracker. In some hard hit markets, such as Phoenix, Arizona, the number is far higher.
“People understand that it’s difficult for lenders to get them out of their homes, and so they are staying longer,” said Mark Zandi, of Moody’s economy.com. “In the past, if you got an eviction notice, you were likely to leave quickly. Now people are staying until there is a sheriff at their door.”
Some sheriffs are refusing to evict homeowners, following disclosures in court depositions that banks flouted state laws by filing thousands of foreclosure documents without verifying the accuracy of the information they contained. A Chicago-area sheriff has ordered deputies to stop carrying out foreclosure evictions over concerns that banks may be reclaiming properties from the wrong people.
In the case of Freddie Mac and Fannie Mae, which together sit on more than 190,000 foreclosed properties, the process of getting distressed homes ready for resale can take months and cost millions of dollars. If borrowers still occupy the homes, Freddie Mac will offer them financial assistance with relocation, a program known as “cash for keys”. Eviction proceedings are a last resort.
Some borrowers are wise to these delays. Shasta Gaughen has not made a payment on her California apartment since February, but Bank of America, which owns the loan, has not forced her out.
“I imagine that they will let me stay for quite some time,” she said.
(Via CNBC)
Monday, October 25, 2010
Thursday, October 14, 2010
Landlords: Stop Lawsuits In Their Tracks!
Recently, a real estate broker who owns rental property was sued for keeping a tenant’s deposit. The landlord took pictures of the property to use as evidence in the case, but the judge wouldn’t look at them because they weren’t date stamped, there was no “before” photo to document the original condition of the property; and since the owner had a financial interest in the properties, the photos were subject to bias. Since the photos were inadmissible in court, the landlord lost the case.
In another situation, an elderly woman moved to another city to retire, but kept ownership of the family home and rented it out. The tenant was an elderly woman who needed the space because her grandchildren spent summers with her. A few years went by and the tenant paid on time, every time. A landlord’s dream-come-true. When the landlord went to her old hometown to visit friends, she decided to stop by the rental home. Instead of an elderly woman and some children, she found that her home was a gang hideout!
Both of these situations were tragic and costly, but thanks to two new ValuFinders products, they are also avoidable. ValuFinders e-Asset Management (VEAM) offers home inspections and occupancy checks to make situations like these a thing of the past.
The VEAM inspection is a comprehensive property condition check which covers the entire home including fences, driveways, walls, stairs, lawns, bedrooms, bathrooms, attics/basements and more. They can be performed at any time, but are especially useful before a tenant moves in and after a tenant moves out. Photos are included for both general documentation, and specific documentation of deficiencies. Furthermore, since the inspector is hired by VEAM, the documentation is third-party and therefore not subject to bias.
The VEAM occupancy check is a simple report that identifies current home-dwellers. The report includes information such as whether the tenants are authorized to be in the home and whether they appear to present a hazard.
VEAM reports are available online, and are archived for 5 years. Multiple inspections can be used to document the history of a property, including original condition, damage done, repairs performed, and post-tenant condition.
VEAM reports can be ordered from http://www.valufinders.com/VEAM.html
In another situation, an elderly woman moved to another city to retire, but kept ownership of the family home and rented it out. The tenant was an elderly woman who needed the space because her grandchildren spent summers with her. A few years went by and the tenant paid on time, every time. A landlord’s dream-come-true. When the landlord went to her old hometown to visit friends, she decided to stop by the rental home. Instead of an elderly woman and some children, she found that her home was a gang hideout!
Both of these situations were tragic and costly, but thanks to two new ValuFinders products, they are also avoidable. ValuFinders e-Asset Management (VEAM) offers home inspections and occupancy checks to make situations like these a thing of the past.
The VEAM inspection is a comprehensive property condition check which covers the entire home including fences, driveways, walls, stairs, lawns, bedrooms, bathrooms, attics/basements and more. They can be performed at any time, but are especially useful before a tenant moves in and after a tenant moves out. Photos are included for both general documentation, and specific documentation of deficiencies. Furthermore, since the inspector is hired by VEAM, the documentation is third-party and therefore not subject to bias.
The VEAM occupancy check is a simple report that identifies current home-dwellers. The report includes information such as whether the tenants are authorized to be in the home and whether they appear to present a hazard.
VEAM reports are available online, and are archived for 5 years. Multiple inspections can be used to document the history of a property, including original condition, damage done, repairs performed, and post-tenant condition.
VEAM reports can be ordered from http://www.valufinders.com/VEAM.html
Thursday, October 7, 2010
Quality Control Review System
Turn Times
As you all should be aware, the standard turn time on most reports is no more than 5 business days. In some instances, clients request shorter turn times, which we try to meet within reason along with your assitance. Please be sure to review the due date noted on your orders before accepting.
Also, turn times vary by report type. Please review the turn-time schedule below to make sure you meet these due dates on future reports:
ValuFinders Turn-Times by Product
PRODUCT TURN-TIME*
1004/1073 5 business days
1004 FHA 5 business days
1025 Multi-Family 5 business days
2055/2075 Drive-By 48 hours
Field Review 48 hours
Enhanced Field Review 72 hours
Desk Review 24-48 hours
Enhanced Desk Review 48 hours
216 Op Inc/1007 Rent Sch 24 hours
1004D Final Insp/Update 48 hours
1004D Enhanced Update 72 hours
Enhanced Reviews
The ValuFinders Guidelines detail requirements for enhanced reviews. As a reminder, enhanced reviews require 3 additional comparables, gridded and adjusted accordingly. The comparables must be closed or closed/active listings combo, 30 days from the effective date of the appraisal under review. Combo: Closed 2 / Active listing 1. A summary of sales comparison approach is also required.
ONLY Active Members Can Complete Assignments
ValuFinders Guidelines specifically note that all appraisal assignments must be completed by an active member of the ValuFinders appraiserConnect network AND must be inspected and signed by that appraiser only. ValuFinders MUST approve all appraisers into the network. Therefore, inter-office reassignments are not allowed. If you have an office account, you can add users to your account that must first be approved by ValuFinders. Once approved, you can assign orders that are sent to your office to one of your users by selecting the Assign tab on the order and selecting the appraiser who will complete the order. The appraiser name on the order in the online system must match the appraiser name on the completed report. Reassignments of orders to non-active members will result in your inactivation in the appraiserConnect network.
Value Variance +/- 20%
If an appraised value differs by +/- 20% from the predominant neighborhood value, you must provide a detailed explanation. Include whether the subject is an over or under-improvement and note whether or not this effects marketability.
Directionals on Neighborhood Boundaries
Neighborhood boundaries should contain all directionals (North, South, East, West). This makes it more user-friendly. Furthermore, neighborhood boundaries must also be present on location maps.
"Other" Land Use
If you enter a percentage other than zero for "Other" under Present Land Use, you must provide an explanation. Often times, it is vacant land, which you can note in the field beside it. If the other land use requires a more detailed explanation, please do so in the Neighborhood Description Field.
As you all should be aware, the standard turn time on most reports is no more than 5 business days. In some instances, clients request shorter turn times, which we try to meet within reason along with your assitance. Please be sure to review the due date noted on your orders before accepting.
Also, turn times vary by report type. Please review the turn-time schedule below to make sure you meet these due dates on future reports:
ValuFinders Turn-Times by Product
PRODUCT TURN-TIME*
1004/1073 5 business days
1004 FHA 5 business days
1025 Multi-Family 5 business days
2055/2075 Drive-By 48 hours
Field Review 48 hours
Enhanced Field Review 72 hours
Desk Review 24-48 hours
Enhanced Desk Review 48 hours
216 Op Inc/1007 Rent Sch 24 hours
1004D Final Insp/Update 48 hours
1004D Enhanced Update 72 hours
Enhanced Reviews
The ValuFinders Guidelines detail requirements for enhanced reviews. As a reminder, enhanced reviews require 3 additional comparables, gridded and adjusted accordingly. The comparables must be closed or closed/active listings combo, 30 days from the effective date of the appraisal under review. Combo: Closed 2 / Active listing 1. A summary of sales comparison approach is also required.
ONLY Active Members Can Complete Assignments
ValuFinders Guidelines specifically note that all appraisal assignments must be completed by an active member of the ValuFinders appraiserConnect network AND must be inspected and signed by that appraiser only. ValuFinders MUST approve all appraisers into the network. Therefore, inter-office reassignments are not allowed. If you have an office account, you can add users to your account that must first be approved by ValuFinders. Once approved, you can assign orders that are sent to your office to one of your users by selecting the Assign tab on the order and selecting the appraiser who will complete the order. The appraiser name on the order in the online system must match the appraiser name on the completed report. Reassignments of orders to non-active members will result in your inactivation in the appraiserConnect network.
Value Variance +/- 20%
If an appraised value differs by +/- 20% from the predominant neighborhood value, you must provide a detailed explanation. Include whether the subject is an over or under-improvement and note whether or not this effects marketability.
Directionals on Neighborhood Boundaries
Neighborhood boundaries should contain all directionals (North, South, East, West). This makes it more user-friendly. Furthermore, neighborhood boundaries must also be present on location maps.
"Other" Land Use
If you enter a percentage other than zero for "Other" under Present Land Use, you must provide an explanation. Often times, it is vacant land, which you can note in the field beside it. If the other land use requires a more detailed explanation, please do so in the Neighborhood Description Field.
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