The FDIC says that only 6.68% of mortgages held by major banks were delinquent in the second quarter of the year — the lowest level in two years.
For the seventh consecutive quarter, the actual amount of loans between 30 days and 90 days delinquent decreased. Today only about $70 billion is in “early-stage delinquency,” the lowest level since the late 2007.
U.S. Bank is suing Countrywide Financial Corp. (which is now part of Bank of America) for breach of contract. Countrywide was supposed to repurchase more than 4,000 mortgages in which it misrepresented the quality of the loan.
To put it simply: Countrywide made loans allegedly without checking the quality of the borrowers. It then sold those loans, claiming they were all high-quality. They eventually ended up with HarborView Trust, of which US Bank is a trustee.
According to the court filing, “Soon after being sold to the trust, Countrywide’s loans began to become delinquent and default at a startling rate. During the time period in which Countrywide originated the loans, it completely ignored its underwriting guidelines.”
The Obama Administration is considering a plan that would allow homeowners with government-backed mortgages to refinance their homes at today’s (low low) interest rates — a move that could save Americans $85 billion and even reduce the federal deficit.
Many homeowners who would like to refinance cannot because they’re underwater or don’t have the kind of high credit rating lenders are looking for these days.
The details of such a plan haven’t been decided (e.g., can you participate if you’re delinquent?), but the general idea is appealing because it wouldn’t need to use any of the $45.6 billion in Troubled Asset Relief Program (TARP) funds, and that money could instead be put toward reducing the deficit.
Our friends over at the California Association of Realtors have gotten fed up with the nation’s biggest mortgage lenders, and it let them know about it.
CAR sent a public reprimand to Bank of America, Chase, Citigroup, J P Morgan, and Wells Fargo, expressing its collective frustration with the lenders’ foot-dragging when it comes to short sales.
This isn’t three years ago, when short sales were new to everyone. Lenders have had plenty of time to get their ducks in a row and deal with borrower requests.
RealtyTrac — as close to foreclosure-data experts as you can get — reports that short sales “soared” in the second quarter.
Q2 2010: Bank-owned or foreclosure properties made up 24% of all sales.
Q2 2011: Bank-owned or foreclosure properties made up 31% of all sales.
And pricing? The average REO/foreclosure property sold for 32% less than one not in foreclosure. And the average sale price for distressed homes dropped 5% from last year.
Is there a silver lining to these numbers? RealtyTrac CEO James Saccacio thinks so. These numbers, he said
For those of you who may have clients in the path of Irene (or would just like to provide good information to your clients), House Logic has a number of great articles on hurricane and emergency preparedness that you can share with your clients. They’ll give you step-by step info on how to
Year over year home sales in Virginia declined 1% in July 2010 to 7,065 units sold, as compared to 7,137 sales in July 2010. We can likely expect several more months of 6,000 to 8,000 home sales per month as we finish out the summer and fall home sales seasons.
Despite declines in the pace of home sales, the median sales prices increased again in July 2011 to $247,650.
In the latest issue of Commonwealth magazine (hitting members’ mailboxes soon if it hasn’t already), guest author Rob Hahn addresses the Franchise IDX issue from the ground up. The controversy at NAR over the Franchise IDX policy may well determine the future of the real estate business in America.
And that’s not an exaggeration. In one sense, the debate is about who should be allowed access to property listings. But the bigger issue is about the very way real estate will be listed and sold in the United States in the 21st century.
The California Association of Realtors’ vision of a statewide MLS is a big step closer, now that two MLSs there have agreed to merge, forming the largest in the country.
On one side, the California Regional Multiple Listing Service (35,000 participants), which was formed in 2010 in a merger between CAR’s own calREDD MLS and nearby Multi-Regional Multiple Listing Service (MRMLS).
On the other side, and just down the road, the Anaheim-based SoCalMLS (33,000+ participants).
The new, combined MLS will use the CRMLS name, and will be 70% larger than MRIS — currently the largest in the country.
Real estate professionals need to be aware of a new FTC rule — “Mortgage Acts and Practices – Advertising,” aka, MAP.
Among other things, it prohibits misrepresentations and imposes recordkeeping requirements on anyone who provides information about mortgage products to consumers.
This affects real estate professionals, because “providing information” can mean something as simple as giving a client a lender’s rate sheet.
The FTC originally proposed the MAP rule in 2009; the goal was to regulate unfair or deceptive practices in the advertising of mortgage products, whether by mortgage brokers, lenders, home builders, and anyone else involved in the process. And, despite NAR’s efforts to get an exemption for real estate professionals, that includes real estate professionals when they provide information about a mortgage product to a consumer.
The rule’s requirements
The MAP rule prohibits misrepresentations in a commercial communication about any term of a mortgage credit product. And “commercial communication” is broadly defined: It covers any oral and written statement designed to “create an interest in purchasing goods or services” — in this case a mortgage credit product. That means any form of credit that is offered to a consumer and secured by the consumer’s dwelling.
And what kind of statement is considered to be creating such an interest? The definition is broad — any information about mortgage terms is covered, and under “mortgage terms,” the FTC includes interest rates, amount of taxes, variability of interest rates, prepayment penalties, and products sold in conjunction with a mortgage such as credit insurance.
The rule applies to real estate professionals when they provide any information about the terms of a specific mortgage product to a consumer. For example, by giving a client a rate sheet for a particular lender, or providing an application for a specific mortgage product.
So what kinds of mortgage-related communications aren’t covered? General information about market rates or types of mortgage products will likely not be subject to the rule (unless it’s related to a specific lender’s product).
Similarly, explaining to a client how a mortgage prequalification works doesn’t fall under the rule, but providing that client with a particular lender’s documentation for preapproval is covered.
General information? Probably not covered. Information about a specific product or lender? Probably covered.
Disclaimers and recordkeeping
So a Realtor® gives a client information that falls under the rule. What does that mean? What does she have to do to be in compliance?
For starters, provide a disclaimer on whatever documents you give out or written statements you make; a properly crafted one can protect against later misrepresentation claims.