Eye On Arizona

Deed In Lieu of Foreclosure – When To Use It To Stop Foreclosure

April 15, 2009 // No Comments »

by Nick Adama

Usually, homeowners do not just want to give up on their home when they begin missing payments. If there is any way to negotiate with the bank or refinance with a new lender, they often take it. But it is when they realize that there is little chance of recovering enough to save the home that borrowers will consider giving the bank a deed in lieu or just walking away.

A deed in lieu of foreclosure allows homeowners to give their property back to the bank in fulfillment of their loan obligation. The bank accepts the property back and the homeowners are off the hook for paying the mortgage any longer. As well, any foreclosure procedures that have been initiated in the court system or with a trustee are canceled.

For borrowers who have no other option to save the home and begin making monthly payments again, a deed in lieu of foreclosure is often their last resort before just abandoning the house. Of course, this option is not for every homeowner, but there are at least four reasons to consider a deed in lieu instead of just walking away.

First, if homeowners have tried to sell their property on the open market for a period of months but have just not found a buyer, it may be worth considering just giving the property back to the bank. Mortgage companies do not always want to own foreclosed homes, but if it realizes it will end up with the home anyway through a sheriff sale, it may be quicker and cheaper to accept the deed in lieu.

Second, if the owners have little or no ability to pay the mortgage, they can consider giving the property back to the bank. This is often the case when there is a permanent change in the borrowers’ financial situation and a once affordable home is now too expensive. Instead of going through a lengthy foreclosure process, the bank may understand that they will not be paid back and it is better to take the property back.

Next, if homeowners have no equity in their home, their options are extremely limited for working out a solution to foreclosure. Refinancing is usually out of the question, even with hard money lenders, and negative equity will make selling the home very difficult. As well, the owners may just not even want to keep a home that is severely upside down, so offering a deed in lieu to the bank may be the best option.

Finally, many borrowers wish to preserve their credit scores as much as possible, and having a deed in lieu appear on their credit report instead of a full foreclosure will help with this. Also, they will be able to avoid some of the late payments by giving the property back to the bank quickly. While this is often a minor concern to many homeowners just trying to get out from under a house, it is another good reason to consider a deed in lieu.

While it is not always easy to convince a bank to accept a deed in lieu, it is not much more difficult than negotiating for a mortgage modification or other foreclosure help program the lender may offer. Homeowners should focus on working with a company or individual who can help explain the process and help them put together a proposal to the bank, and then be persistent in following up with the deed in lieu of foreclosure.
Nick writes articles for the ForeclosureFish website to provide foreclosure help to homeowners in danger of losing their houses. The site describes various methods to save a home, including foreclosure refinancing, bankruptcy, mortgage modification, and more. You can read more about how to stop foreclosure by visiting the site here: http://www.foreclosurefish.com/
Article Source: bb-articles.com

Posted in Foreclosure Facts

Fed to Crackdown on Loan Modification & Foreclosure Fraud

April 8, 2009 // No Comments »

By: Ann Belfield

On April 6, 2009, the Federal Government, along with State Partners, issued a press release on cracking down on Foreclosure Rescue Scams and Loan Modification Fraud.  Many companies are posing as legitimate organizations, sending out official government like mailers and online ads.  These companies often ask for a minimum payment up front to initiate a loan modification.  Help is FREE at the government’s sites, you don’t have to PAY.

The U.S Department of Treasury established their Making Home Affordable website as a resource tool to help homeowners refinance or modify their mortgage.  This site contains a wealth of information and tools that homeowners can utilize to see if they qualify for a loan modification or a loan refinance, among other valuable resources.  The program targets 9 million homeowners who have a loan held by Fannie Mae or Freddie Mac.

The Federal Government issued the following advice regarding loan modifications:

• Only work with HUD-approved nonprofit counselors,
• Do not agree to pay a fee before you are provided with the promised service,
• Beware of people offering “guaranteed” results, and
• Do not sign blank forms or documents that you have not read.

The U.S. Department of Treasury offers a hotline number, 888.995.HOPE (4673), for FREE foreclosure counseling assistance.  Also, check out www.FinancialStability.gov for the latest news on President Obama’s Plan, economic data and updates from U.S. Treasury Secretary Timothy Geithner.  Another helpful site is:  www.hud.gov where you can find extensive guide to avoiding foreclosure.

In Summary, the following links are useful when trying to wind through the myriad of questions and concerns associated with loan modifications, short sales, foreclosures, loan refinancing, and other issues surrounding Obama’s Making Home Affordable Plan and your own housing situation. Here they are in brief:

OPTIONS TO HAVING SHORT SALES: www.financialstability.gov

Are you Eligible? http://www.makinghomeaffordable.gov/

Are you Eligible for a Home Affordable Refinance? http://www.makinghomeaffordable.gov/refinance_eligibility.html

Are you Eligible for a Loan Modifications?

http://www.makinghomeaffordable.gov/modification_eligibility.html

Contact your Mortgage Company: How to find your Mortgage Company’s Information at the Housing and Urban Development’s (HUDs) Hope Now website.

Guide to Avoiding Foreclosure: HUD.gov

According to Attorney General Madigan, authorities are sending a clear message to the scammers and it is not a question of if the government will come after them, but when they will.  Do not be swindled by the unscrupulous mortgage rescue scammers, remember help is FREE.  Protect yourself and save money by checking out the government links above.

Posted in AZ Headlines, AZ Housing Market

Housing Market Snapshot for: Las Sendas, Northeast Mesa, Arizona

April 5, 2009 // No Comments »

By:  Ann Belfield

Las Sendas, a picturesque master planned community in the desert foothills adjacent to the Tonto National Forest in Northeast Mesa, Arizona, presently has 144 single-family (s-f) detached houses for sale. The average price of homes that sold in the community in March was $275,167, while the average price of homes on the market is $964,056. The number of s-f detached home sales declined by 6 in March 2009 as compared to a year ago. The table below displays single-family detached home statistics for Las Sendas.

Overall, Las Sendas experienced a 38% decline in homes sales from the same period last year, while the 85207 zip code where Las Sendas is located, experienced a 12% increase in homes sales. The City of Mesa experienced a 28% increase in sales, and the City of Phoenix experienced a 52% increase in sales compared with March 2008.

Posted in AZ Housing Market, Arizona, Las Sendas

Phoenix – Mesa – Scottsdale Home Sales on the Rise

April 2, 2009 // No Comments »

The Arizona cities of Phoenix, Mesa and Scottsdale, experienced an increase in single-family detached home sales in March over the months of February and January. The Phoenix home sales increased 28%, up 538 closings from February to a total of 1,951 closings in March. Homes Sales in Mesa increased by 25%, while sales in Scottsdale increased by 21%. Buyers are taking advantage of the lower interest rates and the higher degree of home affordability and scooping up bargain priced homes.

Areas like Phoenix are seeing multiple offers on affordable homes. The table below presents an overview of the single-family detached home statistics in the Phoenix, Mesa, and Scottsdale market. It also reveals the numerous amounts of bank owned, short sale, and auction properties.

Market Snapshot: Single Family-Detached Home Statistics for Phoenix-Mesa-Scottsdale
			Phoenix	Mesa	Scottsdale
Total Homes Available on the Arizona Flex MLS			8,365	6,757	3,935
Active Short Sales			1940	743	499
Active REO, Bank Owned			2,916	663	264
Auction Properties (owner occupied)*			5,000*	3,465*	1,707*
Total Homes Closed
	March 2009		1,951	506	243
	February 2009		1,413	379	192
	January 2009		1,283	325	170
Average S-F Detached Home Price		$279,223		$ 293,498	$ 1,186,146
Average Days on Market		143		146	211

With lower interest rates on buyer’s sides, it is a good time to purchase.  Once the economy begins to turn around, renowned economist, Dr. Joel L. Naroff, President of Naroff Economic Advisors, predicts that the Fed may raise interest rates sharply.  He states that the Federal Funds rate could rise from 0.5 or 1% to as high as 4.5% within a six-month period at the first signs of an economic recovery.  Overall, Naroff expects the second half of 2009 to have a stronger fourth quarter than other economic models currently predict.

Sources:

• *Data gathered through ARMLS. Owner Occupied Residential. http://armls.imapp.com/ilinks/search, many of the auction properties are not listed on the MLS and include all owner-occupied properties; therefore the number of homes available in the table does not reflect this number.

• FlexMLS. 31 March 2009.
• Knowledge @ W.P. Carey. The Economic Forecast?  Cloudy with a Chance of Shower, at Least until 2010. 18 November 2008.

Information deemed reliable, but not guaranteed.

Posted in AZ Housing Market

Top Ten Projected Riskiest U.S. Housing Markets

April 1, 2009 // No Comments »

By: Ann Belfield

It’s a no brainer that the recession is heaving chaos into the housing market, so it should come to no surprise that the First Quarter 2009 Economic and Real Estate Trends Report and its widely cited U.S. Market Risk Index(SM) released today, by the PMI Mortgage Insurance Company has gloomy projections. The PMI Report projects that 98% of the 381 Metropolitan Statistical Areas (MSAs) are facing an increased risk of lower home prices by the end of 2010.

PMI’s U.S. Market Risk Index projects the market risk of home price declines over a two year period in the 50 largest MSAs. The index uses economic, housing, and mortgage market factors to assess the probability of home prices in the 50 largest MSAs. Home price appreciation, employment, affordability, excess housing supply, interest rates and foreclosure activity are variables used in factoring the market risk.

According to the U.S. Market Risk Index, the Phoenix-Mesa-Scottsdale MSA ranked 10^th, and it stands a 98.8% likelihood that the area will face lower home prices by the end of 2010. The list displayed below presents the Top Ten Riskiest of the 50 Largest MSAs. Based on PMI’s Risk Index, these MSA’s have a high degree of risk, from 98.8% in Phoenix MSA to 99.9% in Miami MSA, that the home prices will decline.

Top Ten Riskiest U.S. Housing Market Areas 1. Miami-Miami Beach-Kendall; FL 2. Riverside-San Bernardino- Ontario; CA 3. Ft. Lauderdale-Pompano Beach-Deerfield Beach FL 4. Los Angeles-Long Beach- Glendale; CA 5. Las Vegas-Paradise; NV 6. Tampa-St. Petersburg- Clearwater; FL 7.  Orlando-Kissimmee; FL 8. Santa Ana-Anaheim-Irvine; CA 9. Jacksonville; FL 10. Phoenix-Mesa-Scottsdale; AZ

Although these factors seem to dispel gloom and doom in these high Risk MSA Areas, these factors have lead to greater home affordability. While it may be a buyer’s market, some areas, like Phoenix, experience competitive bidding for many bargain priced homes.

Source:  PMI Mortgage Insurance Company. First Quarter 2009 Economic and Real Estate Trends Report 01 April 2009.

Posted in AZ Headlines, AZ Housing Market