Menu
TwitterRssFacebook
More Links

Are you looking for an experienced agent to help you buy or sell a home? Contact Jim the Realtor!

Carlsbad
(760) 434-5000

Carmel Valley
(858) 560-7700
jim@jimklinge.com


Category Archive: ‘Foreclosures’

Mozilo’s Errant Email = Free Rent Forever?

Remember Dan Bailey?  Here is a follow-up from latimes.com:

angeloDaniel A. Bailey Jr. isn’t your average homeowner. He hasn’t paid his  mortgage in more than five years, and has no plans to start now.

His stance stems from a bizarre incident that thrust Bailey into the news in  2008, when he suddenly became a public relations liability for embattled home  lender Countrywide  Financial of Calabasas.

Bailey had blanketed Countrywide with emails begging for a mortgage  modification. The reply came from none other than Angelo Mozilo, Countrywide’s  chief executive, who accidentally hit “reply” instead of “forward” on a note  meant for colleagues. In the misfired missive, Mozilo called Bailey’s letter a  “disgusting” and “unbelievable” example of the form letters then inundating the  lender from borrowers saying they couldn’t pay.

The email:

“This is unbelievable. Most of these letters now have the same wording. Obviously they are being counseled by some other person or by the internet. Disgusting.”–Countrywide Financial founder, chairman and chief executive Angelo Mozilo

Bailey insists that Bank of America is obligated to honor an agreement that  Countrywide’s damage-control squad struck to silence him — a verbal deal he says  entitles him to live for free in the two-bedroom, 938-square-foot bungalow he’s  called home for 21 years.

Bailey, a struggling photographer, said he struck his deal with a Countrywide  executive he knew as Ms. Morgan. She told him he could stop paying his mortgage,  but only if he signed off on a loan modification within 24 hours and kept quiet  about Mozilo and his errant email.

Read the full article here:

http://www.latimes.com/business/realestate/la-fi-live-for-free-20131214,0,4150658.story#ixzz2nTDr1qf6

The whole story from 2008, including the form letter Bailey used from loansafe.org, an internet coaching service for troubled  borrowers:

http://www.foxbusiness.com/markets/2008/05/22/countrywides-mozilo-calls-borrowers-plea-disgusting/

Posted by on Dec 14, 2013 in Foreclosures, Foreclosures/REOs | 2 comments

SB 30 Fails

From the California Association of Realtors:

LOS ANGELES (Sept. 3) – Thanks to partisan political gamesmanship by the Assembly Appropriations Committee, struggling homeowners who sold their homes in a short sale in the past eight months will be further penalized by being forced to pay state income taxes on money they never received, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today.

Senate Bill 30 conforms California tax law to federal tax law, which already says sellers can’t be taxed on forgiven mortgage debt. SB 30 failed to pass out of the Assembly Appropriations committee last Friday.  The vote on the bill was along party lines with Democrats voting “no” and Republicans voting “yes.”

“We are disappointed that California Assemblyman Mike Gatto (D-Pasadena) failed to show the leadership necessary to provide relief to distressed homeowners who are already in dire financial trouble,” said C.A.R. President Don Faught.  “These are real families in real financial need who may well be forced into bankruptcy by an unresponsive legislature.  To heap an unfair tax bill on top of the pain and emotional duress of losing a home is unconscionable.”

Under current state law, when a lender forgives mortgage debt in a short sale, the seller must pay state income tax on the amount of forgiven debt.  The previous California exemption lapsed at the end of 2012, so forgiven mortgage debt on short sales occurring in 2013 is considered taxable state income.  The federal government does not charge federal income tax, and neither should the state.

Unfortunately, Senate leadership, in an act of political gamesmanship, linked the enactment of SB 30 to a new tax measure in an effort to extort C.A.R.’s support for that tax measure.

Posted by on Sep 4, 2013 in Foreclosures, Local Government, Short Sales, Short Selling | 12 comments

NSDCC Distressed-Sales Counts

The foreclosure era is winding down, and around the North San Diego County Coastal region, the overall impact has been less than imagined - let’s recap the counts of distressed-sales:

Year
Short-Sale
REO
Non-REO/SS
Distressed-Sales %
2008
5
30
2,002
2%
2009
110
164
1,949
12%
2010
216
199
2,045
17%
2011
278
190
2,094
18%
2012
356
162
2,634
16%
2013 (YTD)
103
30
1,866
7%
Totals
1,068
775
12,590
13%

Short sales have had more negative impact on average pricing than REOs lately, mostly due to realtor fraud:

Year
Short-Sale
REO
Non-REO/SS
2008
$262/sf
$284/sf
$440/sf
2009
$295/sf
$284/sf
$408/sf
2010
$318/sf
$292/sf
$393/sf
2011
$292/sf
$293/sf
$393/sf
2012
$284/sf
$289/sf
$396/sf
2013 (YTD)
$277/sf
$323/sf
$427/sf
Totals
$293/sf
$297/sf
$409/sf

Hopefully this embarassing chapter in realtor history will be over soon.

Posted by on Aug 8, 2013 in Foreclosure Count, Foreclosures, North County Coastal, Short Sales, Short Selling | 0 comments

New Normal for Foreclosures

Back in the old days there were 100-500 foreclosures per year in SD County:

Microsoft Word - A Brief History of Foreclosures

We’ve already had 1,504 properties get foreclosed in the first half of 2013, so historically we’re still at elevated levels.

But with the county averaging 3,000+ total sales per month, lenders will be able to sprinkle in a couple of hundred REOs each month without affecting values much.  In addition, flippers will keep doing their share; selling a similar amount of properties for retail-plus.

San Diego County Trustee-Sale Results

Lenders must be feeling comfortable at these levels, because the number of total notices were almost identical for the last two quarters. The Notices of Trustee Sale were down 52% Y-O-Y:

San Diego County Filings

Posted by on Aug 7, 2013 in Flips, Foreclosure Count, Foreclosures, Foreclosures/REOs, Jim's Take on the Market | 0 comments

Yunnie Coming Around

Speed Up ForeclosuresAt the Washington Realtors’ legislative hill day this year we had an opportunity to hear from the National Association of Realtors’ chief economist, Dr. Lawrence Yun.  Dr. Yun spoke about the improving real estate market in Washington state and his optimistic outlook for our state’s housing prices to continue rising at a rate faster than the nation as a whole.

At the same time, he was concerned with the persistence of high levels of “shadow inventory” in Washington, even while those levels have been shrinking significantly across the nation as a whole.  Dr. Yun surmised that the legal system in Washington was one that provided more obstructions to the foreclosure process, and that was creating a huge backlog of foreclosures that should have already been back on the market.  The striking lack of inventory in our current market is holding back a large crop of eager buyers and stifling home sales in general.

The essence of Dr. Yun’s point was that we should speed up foreclosures.  On its face, that’s not an argument you’re likely to hear from real estate professionals.  Our organizations are constantly working for property owners’ protections and rights, and fighting fraudulent or predatory practices that force homeowners out of their homes.

This issue, however, is more complex than simply pitting banks against homeowners.  When we really examine the broken foreclosure process in our state, and nationally, we have to make clear distinctions between the protections that distressed homeowners already have in place, and the unacceptable extensions of the actual foreclosure timelines taking place in the market.

There are an increasing number of homeowners who have realized that, even though their home is underwater and they have no intention of keeping it long-term, they can live in the home without making a payments for years on end.  As long as the lender is inhibited from closing the actual foreclosure sale, the number of people living in homes for two and even three years, rent free, continues to build.  The homes are a drag on the community, as these long-term foreclosures deflate nearby housing prices, instead of being resold and fixed up by the new homeowners.  The homeowners can’t just abandon the property, because it is still legally in their name (see Zombie Titles).

The effort to shorten the timelines on these foreclosures would make no changes to the protections already built into the process for the truly distressed homeowner.  There are already a number of steps for that person to repay their debt, work out an adjusted payment schedule, or find another means to save their home.   These people usually have at least a year from the time they stop making payments until the foreclosure sale goes through, and those protections can and will continue to exist for them.

For those homeowners who have already been through the normal foreclosure process and are one, two, or even three years behind on payments, the process needs to be expedited.  These folks have accepted that the home will be foreclosed upon, and the only question is when.  It will be better for the neighborhood and, frankly, better for these former homeowners to move on with their lives and begin to rebuild their credit.  This artificial backlog of foreclosure inventory has an eager market of buyers ready to move in, and our communities could benefit from a healthy gain in home sales as we continue to recover.

So, should we speed up foreclosures?  If the current legal protections are preserved, but the unnecessary multi-year extensions can be avoided, then the answer is “Yes.”  Sometimes, facing up to reality and moving forward is the only way to begin correcting the difficult times we’ve been through.

http://blog.seattlepi.com/seattlewaterfronthomes/2013/01/27/dr-lawrence-yun-on-real-estate-speed-up-foreclosures/

Posted by on Jan 28, 2013 in Foreclosures, Unbelieveable | 0 comments

Zombie Title

From Reuters:

Joseph Keller doesn’t expect he’ll live to see the end of 2013. He blames the house at 190 Avondale Avenue.

Five years ago, Keller, 10 months behind on his mortgage payments, received notice of a foreclosure judgment from JP Morgan Chase. In a few weeks, the bank said, his three-story house with gray vinyl siding in Columbus, Ohio, would be put up for auction at a sheriff’s sale.

The 58-year-old former social worker and his wife, Jennifer, packed up their home of 13 years and moved in with their daughter. Joseph thought he would never have anything to do with the house again. And for about a year, he didn’t.

Then it started to stalk him.

First, in 2010, the county sued Keller because the house, already picked clean by scavengers, was in a shambles, its hanging gutters and collapsed garage in violation of local housing code. Then the tax collector started sending Keller notices about mounting back taxes, sewer fees and bills for weed and waste removal. And last year, Chase’s debt collector began pressing Keller to pay his mortgage, which had swollen, with penalties and fees, from $62,100.27 to $84,194.69.

The worst news came last January, when the Social Security Administration rejected Keller’s application for disability benefits; the “asset” on Avondale Avenue rendered him ineligible. Keller’s medical problems include advanced liver disease, hepatitis C and inactive tuberculosis. Without disability coverage, he can’t get the liver transplant he needs to stay alive.

“I can’t make it end,” says Keller. “This house, I can’t get out.”

Keller continues to bear responsibility for the house because on December 23, 2008 – about two months after he received Chase’s notice of sale – the bank filed to dismiss the foreclosure judgment and the order of sale. Chase said it sent Keller a copy of its court filing on December 9, 2008. Keller says he never received any notification. Either way, his name remained on the property title.

WITH IMPUNITY

The Kellers are caught up in a little-known horror of the U.S. housing bust: the zombie title. Six years in, thousands of homeowners are finding themselves legally liable for houses they didn’t know they still owned after banks decided it wasn’t worth their while to complete foreclosures on them. With impunity, banks have been walking away from foreclosures much the way some homeowners walked away from their mortgages when the housing market first crashed.

“The banks are just deciding not to foreclose, even though the homeowners never caught up with their payments,” says Daren Blomquist, vice president at RealtyTrac, a real-estate information company in Irvine, California.

Since 2006, 10 million homes have fallen into foreclosure, according to RealtyTrac, a number that in earlier, more stable times would have taken nearly two decades to reach. Of those foreclosures, more than 2 million have never come out. Some may be occupied by owners who have been living gratis. Others have been caught up in what is now known as the robo-signing scandal, when banks spun out reams of fraudulent documents to foreclose quickly on as many homeowners as they could.

Read More

Posted by on Jan 10, 2013 in Foreclosures, This Is America | 2 comments

SWAT Foreclosure

IDAHO SPRINGS – A two-county SWAT team was sent to a home in Idaho Springs to evict a 63-year-old woman.  The eviction happened last Tuesday, according to Captain Bruce Snelling with the Clear Creek County Sheriff’s Department.

“Usually an eviction doesn’t call for a tactical team,” Captain Snelling said.

SWAT team members with assault rifles were sent in because two dozen protestors joined 63-year-old Sahara Donahue.  The protestors were part of a group called the Colorado Foreclosure Resistance Coalition, which is part of the Occupy movement.

The group’s spokesperson said they were there to help prevent officers from kicking Donahue out of her home. “We expected one or two sheriff’s deputies to show up, instead what we had was ten vans show up,” Darren O’Connor, a member of the coalition, said.

Read More

Posted by on Nov 6, 2012 in Foreclosures | 0 comments