A ban on foreclosure auctions outside the downtown San Diego Superior Court has forced those who conduct them to two other areas that already host such transactions, a spokesman with a trade group that represents trustees said Monday.
The ban, made official in a July 1 court order, takes effect Tuesday.
People who “cry” trustee sales now conduct business at the entrance of the East County Regional Center, 250 E. Main St. in El Cajon, and outside 321 N. Nevada St., the address of Oceanside’s Housing Division offices, said Richard Meyers, executive director of the Irvine-based United Trustees Association.
It’s up to the individual companies that publish and post the sales to decide where to go, Meyers said.
The downtown San Diego venue had been used as an auction site since the 1960s. Over time, court officials said, dozens of investors, their representatives and onlookers routinely crowded around the main entrance of the downtown facility throughout the day, causing safety and security concerns.
The Coronado mansion at the center of two deaths and much speculation is being sold.
An investment group is in escrow on the historic Spreckels mansion owned by Arizona pharmaceutical tycoon Jonah Shacknai, whose 6-year-old son Max died after accidentally falling over the second-story railing, and whose girlfriend Rebecca Zahau was found hanging from a balcony in July.
Scott Aurich, a Realtor for Pacific Sotheby’s International Realty who brokered the transaction, would not disclose details about the deal, including the purchase price or the identity of the buyers.
The group, which includes a local developer, plans to remodel the property and then put it back on the market. The 12-bedroom oceanfront home is currently listed on Aurich’s website for $14.5 million, although it could be sold for less without the renovations.
Shacknai, who is founder and CEO of Medicis Pharmaceutical Corp., bought the home in 2007 and used the spread as a summer home when he wasn’t in the Phoenix area.
Aurich said he hopes potential buyers will be able to look past the deaths. The home was built 103 years ago by John D. Spreckels, one of San Diego’s first tycoons.
“Hopefully, the rich history of Spreckels owning it and the luminaries who were entertained there outweigh the recent history of the tragedy,” he said. “It’s still one of the most premiere estate properties in Coronado.”
Bank of America is working “very hard” on a short sale-to-lease program for distressed borrowers who don’t qualify for government-backed refinance programs.
But the much-maligned bank won’t move forward until it gains assurance from regulators that borrowers are being treated fairly.
As outlined late this week by B of A executive Ron Sturzenegger at the Urban Land Institute’s fall conference in Los Angeles, the bank would regain title to mortgaged properties under a short sale arrangement, and then lease the houses back to their occupants for three years for rents that approximate the average for their particular areas.
At the end of the 36-month lease, Sturzenegger said during a panel session on capital markets, the institution would re-sell the houses to renters who wanted to buy them back. He did not say what price buyers would have to pay to reclaim ownership from the bank.
Sturzenegger, who is managing director of legacy asset servicing at B of A, said investors are interested in the program, as are borrowers. But two obstacles still need to be overcome before the program becomes operational, he said: governmental clearance and finding someone with the ability to run it.
If they make it a condition of sale that the investors have to rent the REOs they purchase, and can’t sell them, then this idea won’t have much impact on the resale market. Selling bank-owned properties out of the shadow inventory and then designating them for rental properties means the shortage of well-priced inventory for the end buyers will continue. FromHW:
While the Obama administration may be pondering the idea of helping underwater homeowners through principal write-downs, Federal Housing Finance Agency Director Edward DeMarco said there is no current consideration for principal write-downs on underwater home loans.
DeMarco told C-SPAN in an interview that the FHFA has already assisted borrowers through principal forbearance programs and loan modification tools that have helped borrowers reduce their monthly payments. He said the other balance the FHFA has to strike is making sure home aid efforts do not afflict taxpayers with additional losses since public funds hold up the quasi-federal housing agencies. He placed write-downs on principal in this camp and suggested the FHFA is not going in that direction.
“Principal forgiveness does not accomplish our conservator mandate,” DeMarco said on CSPAN while speaking to reporters from Reuters and the Wall Street Journal. He added,”the borrower still has a responsibility and an obligation for the repayment of the loan.”
DeMarco said the FHFA sees the next housing initiative being one that focuses on offloading GSE properties to investors who can buy the REO properties in bulk and turn them into rental properties.
To date, the FHFA has received 4,000 comments from interested parties who submitted feedback on the proposed REO bulk sales program.
“Now that we have the HARP announcement out, we are turning to this as the next priority,” he said.
The FHFA said earlier this month that it would lower barriers to refinancing, allowing more underwater borrowers to qualify for the government’s HARP refinancing program.
Rick Sharga and Carrington are already jockeying for position, trying to run off competitors here. Who ends up getting what, and for how much, should be quite a spectacle, unless it’s all done in secret, behind the usual closed doors.
Feel like doing a rehab? Here’s a sampling of what’s needed to complete a full renovation – five months’ worth of Tom’s work in less than nine minutes (now pending after four days on market, was listed for $499,000):
Cutting to the chase: if you thought this was the deal that would hold banks accountable for filing phony documents in courts, foreclosing without showing they had the legal right to do so and generally running roughshod over anyone who opposed them, you are likely to be disappointed.
As things stand, the settlement, said to total about $25 billion, would cost banks very little in actual cash — $3.5 billion to $5 billion. A dozen or so financial companies would contribute that money.
The rest — an estimated $20 billion — would consist of credits to banks that agree to reduce a predetermined dollar amount of principal owed on mortgages that they own or service for private investors. How many credits would accrue to a bank is unclear, but the amount would be based on a formula agreed to by the negotiators. A bank that writes down a second lien, for example, would receive a different amount from one that writes down a first lien.
Sure, $5 billion in cash isn’t nada. But government officials have held out this deal as the penalty for years of what they saw as unlawful foreclosure practices. A few billion spread among a dozen or so institutions wouldn’t seem a heavy burden, especially when considering the harm that was done.
The banks contend that they have seen no evidence that they evicted homeowners who were paying their mortgages. Then again, state and federal officials conducted few, if any, in-depth investigations before sitting down to cut a deal.
The millions of homeowners facing default on their mortgages will likely become renters once their home is foreclosed. Investment bank Morgan Stanley crunched the numbers and said that the multifamily segment, that arm of commercial real estate that includes apartment buildings, will most likely see a multibillion-dollar boost from the looming migration.
Oliver Chang, a housing and securitized products analyst at Morgan Stanley, the lead author of a report released this week, detailed the migration of ownership to rentals. He expects a drop in the U.S. homeownership rate to 60% in the coming years from 69% at its peak.
The rate tumbled to 65% from a decade ago, the Census Bureau reported this month. It’s the largest drop in 70 years.
According to RealtyTrac, there have been 8.9 million homes lost to foreclosure since 2007, the height of the credit crisis. And there is more to come in the fallout.
Chang said there are roughly 7.5 million households either in foreclosure or delinquent on the mortgage. With the majority of these borrowers forced to pay rent over the next five years as their credit heals, this would equal $72.7 billion in incremental rent payments instead of mortgage payments.
The government is moving ahead to take advantage of the increase in demand. It’s currently developing strategies to rent more of the thousands of government-owned foreclosure properties.
“Burned by the worst housing downturn in history, more households are choosing to rent instead of owning a home,” Chang wrote.
He went on to describe a shift in the focal point of the economy from manufacturing to services. In the latter, Chang said, workers value mobility, and renting provides the opportunity to pursue employment more so than owning a home.
“While traditional drivers like job growth and rent-buy dynamic clearly explain part of the resurgence in demand — the vibrant snap-back in apartment fundamentals in the past year has been augmented by the shifting attitudes in consumers towards renting,” Chang said.
The mortgage industry refutes this idea and is at work tackling its plethora of problems and shortcomings. They range from what some call overly restrictive lending standards on the origination side, a dormant private-label secondary market, and ongoing issues in servicing.
At the Mortgage Bankers Association conference in Chicago earlier this month, the trade group’s new CEO David Stevens refuted the claim that the desire to own a home in the U.S. was dead.
“We have first and foremost an obligation to restore trust with the consumer and ensure that when they buy a home the products they are qualified for will be built on safe and sound standards over the long term,” Stevens said.
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