Legal Loan Relief
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California Homeowners Can Stop Foreclosure with Loan Modifications, Forensic Loan Audits and Negotiated Mortgage Loan Modification Terms.
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25 Jun 09 Loan Modification Applicants Report Bottleneck

If you want to change the terms of your mortgage loan without mortgage refinancing then you need a loan modification. Unfortunately, recent reports indicate that you will be facing a huge bottleneck in the loss mitigation departments with most mortgage lenders. Homeowners have been screaming for foreclosure prevention assistance and more forgiving refinance loan programs, but nothing is ever good enough to solve this mortgage mess. Distressed homeowners continue to claim that they have been waiting months and only a small percentage of borrowers are getting tangible results with their lenders.

Frustration is going back and forth from homeowners to lenders. Unfortunately, Washington, is not helping much either. The Obama administration set up a $75 billion Making Home Affordable program to pay mortgage lenders to modify home loans, but a Treasury Department spokeswoman couldn’t even say whether lenders and banks have to reveal how many mortgage loans have been changed. So why bother trying to get an unaffordable loan modified? John Ulzheimer, president of consumer education for Credit.com, points out that a loan modification, if you can get it, won’t damage your credit the way a foreclosure or a short sale would. And he notes: This process, although difficult, is free.

You don’t have to use those law firms and companies that are advertising heavily, saying they can pull off a modification for a fee, usually of a few thousand dollars. To learn more about the Obama’s loan workout program and mortgage relief in general, go to www.makinghomeaffordable.gov. Homeowners Hope Hotline, 888-995-HOPE. Article was written by Harriet Johnson Brackey for the South Florida Sun-Sentinel.

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24 Jun 09 Foreclosure Moratorium California Loan Modifications

The State of California announced a new state law imposing a 90-day moratorium on foreclosures is in effect. Under this mortgage relief initiative, California lenders must prove that they made an effort to provide a loan modification with delinquent mortgages before they begin the foreclosure process. During that time home loan servicers can carry on with business as usual, including foreclosing on delinquent accounts. The State announced the California foreclosure moratorium would go into effect immediately, but will the major mortgage lenders fall into line with it?

California Foreclosure Moratorium Guidelines:

ü The moratorium applies to first mortgages made from 2003 through 2007.

ü The home loan must be for your principal residence.

ü The homeowner must have received a notice of default.

ü The home loan servicer does not have a California loan modification program in place.

ü Because many homeowners are upside down on their home loans

There is a concern that the 90-day negotiating period will only postpone the inevitable because so far the banks are not reducing the principal. Read the complete Article from the Loan Modification Outlet.> Loan Modification Plans and California Foreclosure Moratorium

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24 Jun 09 California Housing Recovery Slow as Loan Modifications Mount

California loan modification requests continue to sky-rocket. Even with Governor Schwarzenegger implementing another California foreclosure moratorium to help distressed homeowners in the Golden state.

Sales of existing single-family homes were down 30% last year from the 2005 level, while new-home sales showed a record-breaking plunge of more than 60% from 2005 to 2008, according to the Harvard report.

Many Wall Street analysts covering the home-builder sector remain skeptical of talk of a sustained recovery. “Overall, the California builders and construction companies we met with echoed what we have been hearing throughout the U.S.: that there was clear momentum in sales in the spring, but concerns still remain around the sustainability of the improvement we have seen,” said Barclays Capital analyst Megan McGrath in a note recapping a recent industry conference. “The availability of credit, to both builders themselves and to home buyers, continues to be challenging,” McGrath wrote. “While it appears that banks and mortgage lenders are willing to do some construction-only loans to builders, land-related financing appears to be relatively non-existent.”

According to the Mortgage Bankers Association, at least 3.2 million homeowners entered foreclosure in 2007 and 2008, and an additional 600,000 entered foreclosure in the first quarter of 2009. Mortgage servicing companies and lenders continue to report a flux of loan modification applications, so we know the demand for foreclosure prevention measures still exists. Despite these dismal foreclosure figures, the Harvard report did see some long-term positives for the U.S. residential market. In particular, it cited demographic trends such as expected demand from immigrants and so-called echo boomers, or the children of baby boomers.

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01 Jun 09 Home Loan Defaults Rise

Home foreclosures have been a major burden on the Inland economy for Southern California. In April, there were almost 5,000 notices of default filed in Riverside County, according to ForeclosureRadar, a tracking service. The notices are the first step in the foreclosure process. The county had the fourth-highest rate of foreclosure sales last month. San Diego and orange County reported an increase in loan modification and default activity as well.  Mortgage relief measures continue to  be a top priority for government officials in California.

San Bernardino County had about 4,000 notices of default and the seventh-highest rate of foreclosure sales in April. The main state foreclosure law to emerge last year was SB 1137. It requires lenders and loan servicers to talk with borrowers before starting foreclosure proceedings. The goal is to get more mortgage loan modifications. This year, lawmakers introduced more than 30 foreclosure- and mortgage-related bills. Nearly all of the authors are members of the Legislature’s Democratic majority. About two-dozen measures are still pending, with most facing a Friday deadline to clear the Legislature’s appropriations panels.

Some of the bills would put the state in compliance with the federal Secure and Fair Enforcement of Mortgage Licensing Act approved in July 2008. The law requires mortgage loan originators to be licensed and complete 20 hours of pre-licensing legislation, along with other requirements.

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31 Mar 09 Mortgage Relief Comment from Wells Fargo Post

Low and behold, I was astounded to see today that Wells Fargo made a comment about mortgage relief and loan modification qualifications in a blog post. I was shocked not because Wells Fargo was associated with a loan workout, but because it is not their public relations style to comment on a blog about their specific role in the foreclosure prevention arena. Wells Fargo has extended thousands of mortgage modification plans to homeowners over the last few years and I really think that the media and homeowners have given them a “bum rap” that is not warranted.

Let’s not forget that Wells Fargo never offered 2-year adjustable mortgages and high risk option ARM’s with the 1% teaser rates that Chase, WAMU, IndyMac, Countrywide, World Savings and pretty much every other subprime mortgage company offered a years back.

Here is the unsubstantiated comment: “Knowing that it would probably be unlikely that Wells Fargo could comment publicly on the mortgage issues facing the Kropkowski family, I still asked the company for a response early Monday. This came in Monday night, just after my column deadline:

“During a time of financial hardship, various workout options are explored and may be available to customers.  If a homeowner can’t demonstrate financial ability to afford a loan modification under the investor guidelines, Wells Fargo is unable to extend a loan modification.  Due to customer confidentiality and other privacy considerations, Wells Fargo cannot share specific customer loan information beyond what the customer has chosen to make public.” Debora Blume, in the Communications Dept. of Wells Fargo Home Mortgage. Original Blog Post >

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15 Mar 09 Loan Modifications in California

Foreclosure activity in San Diego, California dropped by nearly 12% from last month, as mortgage lenders cut back on repossessing dwellings in anticipation of President Barack Obama’s plan to help distressed homeowners. MDA DataQuick, a research firm located in San Diego reported recently that there were 1,107 foreclosures last month, a 15% drop from a year earlier. It was the first year-over-year decline in foreclosures since March 2005.

There were 2,808 notices of default in the county last month, a drop of 8% from the previous month and nearly 10% from January 2008. Such notices mark the start of the foreclosure process. Mortgage lenders are hoping that Obama’s $75 billion foreclosure-prevention program will help them avoid the expense of taking back homes and reselling them at reduced prices during the housing slump. Many San Diego homeowners have missed mortgage loan payments for several months without receiving default notices, analysts say. When mortgage lenders reclaim numerous defaulted homes, they place downward pressure on property values and reduce their own profits from foreclosure re-sales.

The Federal Government continues to put pressure on lenders to provide harder to keep people in their homes has been building since before the November election. I think we are going to see February numbers artificially low and we will see how the nation responds as the foreclosure-prevention proposals kick in March.” DataQuick analyst Andrew LePage said many home loan lenders will likely delay foreclosures even without the Obama plan, because finding alternatives to default is in their own best interest.

Federally controlled mortgage giants Fannie Mae and Freddie Mac and major banks JPMorgan Chase, Citigroup, Morgan Stanley and Bank of America are delaying foreclosures through March 6, Sharga said. Obama’s foreclosure program got under way March 4th, but little progress has been made. Fannie Mae and Freddie Mac had suspended foreclosure sales during the winter holidays and stopped evictions from foreclosed properties through the end of this month. Together, they own or guarantee about half of all U.S. home loans. Many California homeowners have jumbo mortgage loans that exceed the loan amount limit that is targeted for relief with mortgage modification programs and mortgage refinancing for borrowers up to 105% loan to value.

According to RealtyTrac, increased efforts to loan workouts and foreclosure prevention haven’t kept pace with the deepening housing market decline. Nationally, more than 2.3 million homeowners faced foreclosure proceedings in 2008, up more than 80% from 2007, Distressed borrower Brendan Klein, 33, of San Marcos is skeptical of federal stimulus efforts. “Politicians are running around saying, ‘We are going to set this up for people in trouble,’ but none of it is happening,” Klein said. Klein, a skateboard shop manager, is trying to negotiate a loan modification to avoid foreclosure on a two-bedroom condominium he shares with his wife and 1-year-old son. Klein said he took out a risky stated-income loan to buy the home in 2004. Now that his home loan payments have adjusted higher, his budget is stretched to the limit. Unfortunately, he has been unable refinance because the home is worth $150,000 less than he paid. Klein said he doesn’t want to walk away from his debt, but he has cut back spending as far as he can. “I don’t have a gambling debt,” he said. Critics say such borrowers may receive little help from the $75 billion foreclosure-prevention program.

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08 Mar 09 Loan Modifications Help Keep Homeowners Away from Foreclosure

New federal program aims to help those with no equity, or borrowers who are delinquent on their first or second mortgages. In some cases, the borrower may behind on both 1st and 2nd loans.

Understanding mortgage loans can be confusing enough, and now comes a new maze of incentives, eligibility requirements and loan workout options under the recently announced two-pronged federal program to rescue troubled homeowners. The new federal Making Home Affordable program is aimed at helping homeowners who are current but have little or no equity in their homes by refinancing their loans, and at delinquent or at-risk borrowers by restructuring their home loans.

What happens in a mortgage refinancing or loan modification is contingent on three factors: The modification rules set for lenders and loan servicers who join the federal program; the homeowner’s circumstances, such as family hardships; And the mortgage lender, investor or loan servicer, who has some leeway and incentives in deciding on changes to the loan. Article written BY ELLEN YAN

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11 Feb 09 Fed Agrees to Purchase Bad Credit Securities and Keeps Key Interest Rates Near Zero

Federal Reserve committed to buy bad credit mortgage securities and treasuries if deemed effective; Fed believes that mortgage interest rates to remain low for “some time”. The Fed is committed to mortgage relief expansion that includes the purchase of housing debt and bad mortgages.


Watch the Mortgage Relief and Financing Analysis by Richard Dekaser of National City Bank.

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