Thursday, March 29, 2012

Wonder How Many Bank-Owned Properties Are In Santa Clarita Valley?

Yes, my specialty is Real Estate in the Santa Clarita Valley. I service the San Fernando Valley, on a referral basis, as well. This post is focusing on the Valley I live and work in. The one that the majority of  my business encompasses.

We have access to title records as Realtors, and via those sites we can get an idea of what's happening, foreclosure wise, in our pretty little valley.

As of today, 3/29/12, this is what our title reports are telling me:

In all of Santa Clarita Valley (Acton, Agua Dulce, Canyon Country, Saugus, Valencia, Newhall, Stevenson Ranch, and Castaic) we have 707 homes that are noted as Bank-Owned. The highest number is in the 91387 zip code with118, and lowest is in 91381, with 41.The 91387 zip is part of Canyon Country and Fair Oaks Ranch and 91381 is Stevenson Ranch and Westridge Valencia.

Homes noted as status Auction (generally meaning a Notice of Trustee Sale date has been recorded) equal 1213. Again 91387 is the highest with 189. This time, Acton is the lowest, with a mere 47. Auction means buy it at the courthouse steps or get foreclosed on.

Pre-Foreclosure status (Notice of Default has been recorded) amounts to 694. Again, 91387 highest at 110 and Acton lowest at 35.

That's over 2600 homes that are bank involved. Many will end up on the MLS, some will get there as REO's, some as Short-Sales. The first two will be the likeliest candidates for REO's. Hope that the last category will get loan mods, forbearance, reduction, or SS success.

Now, may sound like a lot? Not so much, really. I checked the census information for 2010. We have 176,320 people living here ~ ha, that we know of! And, we have 62,055 housing units. For sake of ease, I'm going to presume most of those are ownership units. You see, that 2600 isn't really all that much in the grand scheme of SCV things.

Right now, in our MLS, we have under 800 homes available for sale. A good, comfy market is about 1300 active listings. Give me those REO's and we'd sell right through them. And, I think the possibility of, by the time they make it to the market, the remaining two groups would be getting cleared out pretty quickly also.

I've been saying for a while, and I'm hearing others thinking the same thoughts lately, that the banks are hanging onto these REO's so that their books look better to the 'board', or their investors. The loan is 500, the value is 300. When they get it back, it still looks like 500 until they sell it for 300? I'm not sure.

Now, I read something today that is making me think otherwise......calculating person that I am....

Bottom is here, the article said, appreciation to start next year. Super. Unemployment is improving, the economy is getting better. I know, seems hard to believe! Keep with me here.....So with the improvement, inflation goes up a bit, yes? And, interest rates go up a tad, too....right?

Now, the banks are in the business of loans, not owning homes......are you with me now? Ya think they are holding onto these homes, earning a bit of appreciation (remember my blog post about B of A and mortgage to lease?), and then, when rates are a smidgen higher....they will release them and get new mortgage loans on them!!!

Although we have a couple thousand in distress, it's not so much that we can't clear them out....if we only had them to get to......

Monday, March 26, 2012

Underwater and Want To Stay? B of A May Let You Lease Instead.

Not happening here in Santa Clarita Valley...yet.....but in the hard hit states of Nevada, Arizona, and New York, Bank of America is working on a leasing program that allows underwater homeowners to lease their home instead of lose it completely by Short-Sale or Foreclosure.

Yes, Bank of America would, in effect, be the new landlord.

The program is called Mortgage to Lease. You cannot contact them, they will contact you. Unfortunately less than 1000 mortgage holders will qualify for the program. There will be a few hoops to jump through, and, you won't own your house anymore either. But, it will let you stay where you are and not have the upheaval of a move after the catastrophe of losing your home.

The lease payment would be less than the mortgage payment. You can lease it for up to three years. The mortgage debt will be forgiven. And, B of A will now own the home.

Banks don't want the expense of a foreclosure. Looks like they are willing to take your home back to avoid that expense, but they are aware of the great rental market out there too.

So, gee, let someone pay the rent for 3 years, and then sell it when there has been a little appreciation? No foreclosure expense. I'm sure there is some tax credit for B of A too. And, them some income.

Sounds Like A No-Brainer to me....

Eligibility requirements for Mortgage to Lease
  • Loan owned by Bank of America
  • Delinquent for more than 60 days
  • Already exhausted modification solutions or have not responded to alternatives to foreclosure, including short sale and deed-in-lieu
  • A high loan balance compared to current property value
  • Face considerable risk of foreclosure
  • No junior liens
  • Still occupying home
  • Adequate income to make rent payment

Thursday, March 22, 2012

Looking Good! Well...., Looking Up!

Several different articles landed on my e-mail and in front of my eyes this morning. And, after doing my Realtor prospecting, showing Valencia property, and writing an offer on one....I am jotting down some notes about the news in Real Estate today to share with my readers!

Although it is still about foreclosures, interest rates, Robo-Signing settlement, appreciation, or lack of, there were some teeny weeny rainbows in the articles.

1) Rate of Properties Entering Shadows = Rate of Properties Finding Light ~ I think the title sheds the light on the subject matter. The current rate that people are going into foreclosure is matching the number of distressed sales being completed. That's good. Of course, it'd be better in the Santa Clarita and San Fernando Valleys if we had a little heavier weight on the side of sales! Inventory is at a record low.

2) Zillow Survey: Prices Projected to Fall ZERO~POINT~SEVEN %, But Rise Next 4 Years ~ The survey was only responded to by 104, but they were Economists, Real Estate experts, and Investment & Market Strategists. So, I'm holding that one with high hopes!

3) Number of Overdue Mortgages Drops to 5,846,000 ~ Doesn't seem like something to get excited over, but if the number of delinquent homeowners is going down instead of up, that is another good thing. And, these numbers were comparing prior month and the prior year.

4) This one is not so good, or you would think ~ Survey Suggests More Homeowners Are Open To Strategic Default ~ Oh yes, this annoys the heck out of me. So, I'm going to keep going and be gracious about the first three I noted above.

5) And, in the L.A. Times this morning ~ Federal Reserve to Fine Eight More Banks on Foreclosure Violations ~ So, if you were bummed that your home loan wasn't being carried by the first Big Five in the Robo-Signing Settlement, here is another chance that your bank will be making some amends!

Real Estate in the Santa Clarita Valley is changing daily. Mark my website as a favorite so you can check back regularly and keep current on what is happening in our community.

Sunday, March 18, 2012

Some Great HAFA Changes Start June 1st

The Home Affordable Foreclosure Alternative (HAFA) program is making some additional changes effective June first of this year. The HAFA program was designed to help homeowners avoid foreclosure. Anything that can be done to help more people avoid foreclosure ~ you know I'm all for it. In the Santa Clarita Valley Real Estate market we have a lot of underwater homeowners. Many would prefer to stay in their homes, but if they just can't, the HAFA program does help them with relocation costs and more.

The HAFA updates will certainly allow more underwater homeowners to get assistance. Great news is the deadline in submitting for the eligibility will be extended to 12/31/13.

Other changes from the March update to HAFA are:

1) Removal of Owner Occupancy Requirement. The seller used to have to live there during the prior 12 months. Now, no such requirement, but the homeowner can't have purchased another property in the last 12 months.

2) The $3000 relocation incentive will be limited to properties that are occupied by the homeowner or tenant during the Short-Sale.

3) Mortgage payments will be allowed to exceed 31% of the homeowners gross income. This allows the homeowner to stay current on their mortgage, if they can afford it  ~ reducing the ding on their credit!

4) Nice for listing agents negotiating with a junior lien holder! Now the lien holder can get a maximum of $8500 instead of the $6000 allowed before.

5) The Credit Bureau Reporting will be changing the way it is noted too. Either 'Paid or Closed Account/Zero Balance', maybe 'Account Paid In Full ~ A Foreclosure Was Started'.  Obviously dependent upon the situation.

These HAFA updates are great for those homeowners that want to take the least ding on their credit, by staying current on their mortgage! Allowing some tenant occupied properties to possibly get the 3k assistance. And, the 2nd loan holder getting more money makes them happier and more likely to be cooperative with a SS.

Santa Clarita Valley and it's surrounding communities are beautiful. We have tons of SS's now, many REO's too....but it's still one of the best California neighborhoods to live in!

Thursday, March 15, 2012

FHA Loans Are Going To Get More Expensive !

If I hear it, I'm sharing it. As a Realtor in Santa Clarita Valley, I network with many different entities and keep poised on new information that comes down the pipeline. So many buyers have been using FHA loans in Valencia and it's surrounding communities that this is extremely important to know.

FHA mortgages are poised to get more expensive ~ Today in the LA Times ~

The Federal Housing Administration (FHA) plans to impose significant restrictions on the amount of money that sellers can contribute at closing in the near future.  The FHA also will be raising its mortgage insurance premiums during the coming weeks, increasing charges for new purchases across the board.

One reason for the increase in fees is that over the last six years, the number of FHA loans used by buyers has increased significantly.  The housing program is financing 40 percent or more of all new-home purchases in some areas and is a crucial resource for first-time buyers and moderate-income families.  This is especially because of the low 3.5 percent down payment required for most FHA loans. It's been a great loan program for my buyers, particularly when every penny has counted. 

During this span of rapid growth, the FHA’s insurance fund capital reserves have steadily deteriorated – far below congressionally mandated levels.  And delinquencies have been increasing.  As a result, the FHA is under the gun to get its own house in order, cut insurance claims, and rebuild its reserves. Understandable.

Under the changes, the FHA will lower its seller concession cap to 3 percent of the home price or $6,000, whichever is greater.  Currently, the FHA allows up to 6 percent of the price of the house to go toward buyers’ closing costs. Closing the gap will cause less borrowers to be able to buy.

Beyond that change, the FHA also plans significant increases in insurance premiums – upfront premiums will rise to 1.75 percent from 1 percent, effective April 1, and annual premiums will increase by 0.1 percent on all loans under $625,000 and 0.35 percent on mortgage amounts above that, effective June 1. This I knew about from my lender connections.

Damn It! While the majority of my current buyers are non-FHA buyers, it will be a challenge for the next FHA buyer I get referred to me.

Tuesday, March 13, 2012

Documents You Should Expect To Provide Your Lender For A Short-Sale

If you are still unsure about what to do with the home that is strangling you and your family financially, a Short-Sale may be your best option to keep a Foreclosure off your credit reports. Yes, a SS (Short-Sale) will cause a ding and show up as well, but less of a ding, and less time will it be on the infamous FICO scorekeepers books.

If you haven't already figured out what it may take, I will give you just a sneak peak about the kinds of documents you most likely will be required to present to your Realtor who will subsequently present them to your mortgage holder on your behalf. You can go to my website KeepYourWitz.Com, and look for more information at the top with the Robo-Signing Settlement tab (to see if you qualify for that help), or the bottom with a YouTube video which also describes a SS.

This is not what every lender will ask for, but this will give you a sample of what you may need to be prepared to turn over.

1) Two most recent pay-stubs, for each borrower on the note
2) Verification of length of employment for each borrower on the note
3) Most recent bank statements, all accounts. Including 401, etc.
4) Most recent Tax Returns
5) Hardship Letter
6) Proof of medical disability or hardship to support your change in earning capacity
7) If self employed, current income statement, balance sheet and statement of owners equity
8) Documentation of any additional income
9) Completion of Financial Worksheet showing all income and expenses

The better prepared you are before you call your Realtor, the smoother the SS transaction will go. Don't kid yourself though. As a Certified Distressed Property Expert here in the Santa Clarita Valley, I've done my share of SS''s a challenging process to say the least. As long as everyone is working towards the common goal, it is more likely to find completion.

For any information about Real Estate in Valencia, Saugus, Stevenson Ranch, Canyon Country, Newhall, Castaic, or any other areas of the Santa Clarita Valley, feel free to contact me. I will help you and your family in any way I can.

Friday, March 9, 2012

Record High Levels of Home Buyer Affordability Continue

According to Freddie Mac, due to the rates being at an all time 60 year low, the levels of Home Buyer Affordability is continuing to increase.

This is good news. The article I read this morning states that 'The typical family had more than double the income needed to purchase a median price home in January." 

The market is definitely starting to turn. We have great, unbelievable rates, lending is loosening (just a tad), we are working through the Short-Sales, the Robo-Signing Settlement is underway, HARP has expanded, all things that are helping to work through this.

The number of homes here in the Santa Clarita Valley for sale is very low. Multiple offers are happening. Short-Sales are getting approved. Buyers are buying homes. When we start to see a few more homes available for sale, I believe more people will come out to buy as well.

We know that a lot of people were waiting for the infamous bottom to's here people.....that's what we are's here....ya think?

Tuesday, March 6, 2012

Santa Clarita Valley 30 Day MLS Stats

The amount of Active listings in Santa Clarita Valley has shrunken since I last noted the stats here for you. But, the number of properties under contract has increased. And, yes that is due to the number of Short-Sale listings showing up as 'Back-up' position.

The joke had kind of been that what showed as active really wasn't. I believe more agents are following the MLS rules and noting them as in back-up position vs. leaving them showing as active when they truly were under contract.

At any rate, below are the stats of today:

Total ~ 894
of that,
405 are Short-Sales
142 are REO's

Total ~ 953
of that,
609 are Short-Sales
155 are REO's

And, Closed Sales in the last 30 days:
total ~ 241
of those,
86 were Short-Sales
74 were REO's

Still hanging tough with about the same number of closings per month. And, still about 60% distressed properties.

Certified Distressed Property Expert ~ that's what I am. 
Contact me for any of your Distressed Property questions.

Saturday, March 3, 2012

What's Going On With The Robo Settlement?

It happened a couple of weeks ago. Settlement for the Robo-Signing debacle. 25 Billion dollars to assist in the housing/finance mess. Well, hmmm, that's a little short for the 750 Billion dollar mess we are in.

Regardless, this post is to help explain it a bit to the people that read my blog. That count on me for some help in understanding what is happening in their Real Estate world of Santa Clarita Valley.

First, it's a 3 year plan. Nothing going to happen overnight. And, if you are backed by Fannie, Freddie, or have and FHA loan, this doesn't apply to you.

5 billion will be paid out in 2k increments to the people that were 'Robo-Signed' into foreclosure. Okay, so, there were several Linda Greens signing. Those people still were in default....just sayin'.

10 billion is to assist people that are delinquent via load modifications and possible principle reductions.

3 billion to help underwater homeowners that are still current on their mortgage.

7 billion to help distressed homeowners via forbearance, relocation assistance (think HAFA), and Short-Sales.

There is a website called National Mortgage Settlement you can find via my website : My Personal Website ~ Click on Robo-Signing Settlement on the toolbar near the top. It has a lot of information, more than I can provide here. Will help determine if you are a candidate and more options for you.

Wells Fargo has is the first one I have read that has laid out how it is supposed to work. Wells Fargo Explains How It's Going To Work It's a great little piece. And, I'm sure we will see more.

Great, we've got a little bit of money going around. Now, that they have had their hand slapped, there are more guidelines to follow.

I do think that there will be more incentive to expedite short-sales. We know that it costs more to the bank to foreclose than approve a short-sale too. Whatever the banks earn the most credits on, i.e. whatever they lose the least amount of money by what is going to happen.

As a Certified Distressed Property Expert, it's my job to keep informed about any of the latest developments that involve underwater homeowners. Short-Sale may be your only option to avoid a foreclosure on your financial history. As always, don't wait for someone to come knocking on your door, be proactive. Ask for of when it's too late.