You are here: Home / Archives for Foreclosures

Many Properties in Multiple Offers Right Now

March 30, 2012 By Leave a Comment

There are a number of properties that are in multiple offer situations right now.  I’m working on a bank deal right now and we don’t know the final tally, but we know for sure that there are 10 offers on the property.  That was within the first four days the property was on the market.  It’s a newer town home in Maple Grove priced under $110,000.  If it were priced at $120,000 it would not have garnered nearly the interest that it has just $10,000 lower.

Any home can be sold.  It’s all about value.  It’s not about the marketing.  Trust me.  When you see the “marketing” that the REO (real estate owned) agents do, you will know that marketing doesn’t sell homes.  Is it priced aggressively?  Is it on the MLS?  If so, it will sell.

Filed Under: Real Estate Tagged With: , , ,

Banks Are The New Airlines

March 28, 2012 By Leave a Comment
Passengers look for bags in New York - Airlines

Photo: MSNBC NY LaGuardia Airport

Remember when the airlines absolutely sucked?  (Pardon my language but how else to describe?)  Remember how awful the customer service was in the airline business in the 1980′s and 1990′s.  They seemed to have no care for their paying customers.  Service was terrible.  Response times were terrible.  Few if any seemed to go the extra mile to take care of an issue.  It was terrible.

Well I think the banks are the new airlines.  And when I mean banks, I don’t mean the front end of the banks – the retail side.  Those are some of the nicest, most polite and pleasant people you’ll ever meet.  I’m talking about the REO (real estate owned) and foreclosure side of the house.  The communication is stunningly poor and ineffective.  They are unresponsive.  There is no appreciation for those of us in the field trying to “get things done” for our buyers on their properties.  We are on an “as needs to know” basis and when we need a response, it might be days to get something back from them.  However, once they send us something they DEMAND that it be turned around in 24 HOURS or the deal is potentially DEAD.

It’s difficult to know where the problem lie exactly.  It could be the bankers themselves or it could be their asset managers that they’ve hired to “dispose” of their housing inventory.

They are now costing my buyers money because of their unresponsiveness and lack of attention to detail.  The latter has really been incredible lately and it’s amazing anything gets done.  If you’re reading this as an end consumer, you may not care in a broad sense what real estate agents get paid to put these deals together, but I would hope you care about your own particular agent.  Freddie Mac has started to cut commissions to Realtors now I guess perhaps because their deals are so easy that Realtors shouldn’t get paid their 3% :)

Freddie Mac

Currently I’m working on a Freddie Mac property where they misspelled my buyers name.  It’s a common name and they added a letter that should not have been there.  They have to send it back to be revised.  That was last Friday.  It’s now Wednesday afternoon…5 days later…still no revised contract.  It has to work its way through the bureaucracy for one letter!!!  Meanwhile, this is costing my buyer money as interest rates slowly tick higher.

I’ve had other dealings with Freddie Mac and they would definitely get my vote as the worst bank in America to buy a house from.  Bank of America might be a close second after the debacle I am currently working through right now.  There are plenty of characters who might, on any given day, might earn the award of being the worst bank in America when it comes to buying REO property.

One thing is for sure, these parts of the banking business and asset management business charged with disposing of these properties must have taking their customer service training from the same folks who trained the airlines many years ago.

Related articles
Enhanced by Zemanta
Filed Under: Real Estate Tagged With: , , , , ,

More and More Homes for Sale are HUD Homes – FHA Foreclosures – The Next Wave Starts Now

March 4, 2012 By 1 Comment

HUD logoHUD Homes…what comes to mind when you think about HUD homes?  I suspect HUD has been preparing for this for some time as it was about a year and a half ago that they updated and changed their web site to a store – it’s now called HUD Home Store.  Perhaps it’s not unlike a large scale retailer where they need a web store.  As far as I know, the back end is not run by Amazon however.  You know this is going to be huge if HUD starts showing up with portable kiosks or small retail outlets in every mall in the country :)

If you’ve been in the business a while or if you are an investor, HUD homes often are some of the worst, least desirable properties in the marketplace.  But they are often dirt cheap.  Well get ready for the next wave of foreclosures as these former FHA homes come to market as HUD homes.  Now it’s possible that the federal government will come up with some program where these don’t all hit the market…perhaps they sell them off in bulk to investors who will agree to turn these in to rentals.  The truth is, many of these HUD homes will be turned in to rentals anyway.

I do not have any insider information on this.  All I am doing is reading the tea leaves and when the vast majority of purchase mortgages (and an increasing number of refinancings) have been FHA mortgages, and with near 10% of FHA loans in serious delinquency…well the number of potential HUD homes starts to get rather large.

HUD Home Mold Warning Sign

HUD Home Mold Warning Sign

At this point I am unable to find the statistics that show how many mortgages were underwritten last year.  However, I found this very cool FHA infographic that is a must see!  The source on this is HUD:

  • 1,271,211 total number of FHA mortgages underwritten in 2011
  • 61.2% were purchases
  • 33.1% were refinancing
  • 75% were first time home buyers
    • 61% non-minority home buyers
    • 32% were minority home buyers
  • Average credit score: 698

In our market in the Twin Cities, if a home in being purchased that is under $300,000 to $325,000 it’s my experience that 2 out of 3 times that is going to be an FHA loan.  FHA only requires a 3.5% down payment so there’s not much of an equity cushion if indeed prices continue to slip.  The fact is that there have been a few million FHA mortgages written in the past four years while at the same time, home prices have continued to slide in nearly every market in America.  They are all underwater.

Will this be as big as the tsunami that started to hit in 2008…no, but it will be noticeable and if you’re an investor, the timing of these wave is going to be fantastic!  Recall even BusinessWeek could see this coming when they published the article “FHA-Backed Laons: The New Subprime” and that was back in 2008!

I will soon publish more information about how to buy a HUD home and what you need to do and what you need to be aware of as both an owner occupant and an investor.  If you would like to try to buy a HUD home, I am registered and can help you with that process…and it is a process.

Related articles
Enhanced by Zemanta
Filed Under: News, Real Estate Tagged With: , , , ,

Fannie Mae’s REO Inventory Declined by 27%

March 2, 2012 By 1 Comment

Fannie Mae REO inventory declined by 27% in 2011.  Fannie Mae is the government sponsored entity that buys mortgages on the secondary market.  REO stands for real estate owned and that term is specifically used for bank owned property that is taken back in a foreclosure.

27% decline is a massive drop in inventory.  Fannie’s current REO inventory stands at 118,500 properties.

According to the Housing Wire story:

For the first time since the collapse, Fannie sold more REO than it repossessed. In 2011, the government-sponsored enterprise acquired nearly 200,000 properties and sold more than 243,000, the most in the company’s history.

They also go on to note that the concentration of REO properties is in California and Florida:

More than 23% of the Fannie Mae REO inventory is located in California, the most of any other state at the end of last year. The next closest is Florida, at 11.5%.

Lastly, Fannie Mae continues to collect only about 55% of the unpaid principal balance that was left on the loan before it went to foreclosure:

Fannie vendors continued to sell REO for slightly more than half of the unpaid principal balance left on the loan before foreclosure. In 2011, REO net sales price equaled roughly 55% of the UPB on the loan, down from 57% the year before. In 2006, it was 83%.

While these numbers still tell a grim story about the housing market, the key information is that at least for now, the trend appears to have turned and is moving in the direction of a healing market for housing.

Related articles
Enhanced by Zemanta
Filed Under: Real Estate Tagged With: , , , ,

Twin Cities Foreclosure and Short Sale Report Through December 2011

January 22, 2012 By Leave a Comment

Check out the latest from the Minneapolis Area Association of Realtors with regard to Foreclosures and Short Sales in the Twin Cities.  The big take aways are that inventory is falling in all segments – traditional sellers, foreclosures, and short sales.

Related articles
Enhanced by Zemanta
Filed Under: Real Estate Tagged With: , , ,

Foreclosures Drop to Lowest Levels Since 2007 and Down 35% from 2010 Levels

January 12, 2012 By Leave a Comment

The foreclosure business appears to be drying up.  According to Housing Wire, there were 205,000 foreclosure filings in the month of December 2011.  That’s the lowest monthly total since November 2007 and for the year 2011 was 35% lower than 2010.

Given the political football that foreclosures have become, it’s is difficult to know if this is a real slow down in foreclosures or if it’s just that the banks have slowed down the processing.

Related articles
Enhanced by Zemanta
Filed Under: Real Estate Tagged With:

Housing Market Bottoming Now in 2011 – Former RealtyTrac Executive, Rick Sharga

October 3, 2011 By 1 Comment

I guess I didn’t realize that Rick Sharga left RealtyTrac for Carrington Mortgage Holdings.  Rick was always the public face every month when RealtyTrac published its latest foreclosure data.  The fact that he has left for greener pastures is interesting.  Carrington Holdings deals in part in the distressed mortgage business.  There is real money to be made there.

From the Housing Wire story:

[[Update 1: Corrects delinquent loan figure and date that market expected to bottom out]]

The U.S. housing market will hit bottom this year and remain flat until 2014, when it will start to slowly recover, said Rick Sharga, an executive vice president with Carrington Mortgage Holdings.

“We’re looking at a catfish recovery,” he told attendees at the Asian Real Estate Association of America conference in San Francisco Friday, saying the market will bump along the bottom for some time before starting to revive.

More than a million foreclosure actions that should have taken place this year have not yet moved forward, and that delay pushes a resolution of the housing market’s problems into next year and beyond, he said, citing data from RealtyTrac, where Sharga served as a senior vice president until this week.

The bottom in the housing market has been called so many times, it’s hard to keep track.  Are we at the bottom?  Possibly.  If we can get job growth back the bottom will be in.  If we don’t get any job growth, we will likely continue to drift slightly lower for the next several years.

Related articles
Filed Under: Real Estate Tagged With: , , , , , , , , , , , ,

Dylan Ratigan and Barry Ritholtz on Settlements, Wall Street and the Firing of FL AG Investigators

September 24, 2011 By Leave a Comment

Good discussion between Dylan Ratigan and Barry Ritholtz on the on going issues with the 50 States Attorneys General Mortgage Fraud Settlement with the top 5 banks.

[vodpod id=Video.15451567&w=425&h=350&fv=launch%3D43745938%26amp%3Bwidth%3D400%26amp%3Bheight%3D320]

Filed Under: Real Estate Tagged With: , , , , , , , , ,

Shadow Inventory of Homes Improves – S&P

August 18, 2011 By Leave a Comment

Standard & Poor’s is out with some new analysis regarding the shadow inventory levels of housing in the U.S.  The shadow inventory is often considered that inventory that either the banks are sitting on or are in some state of foreclosure and will be coming on the market in future months and years.

According to this Housing Wire story, shadow inventory is down to about 40 months now based upon present liquidation rates…I love that…liquidation rates.  I guess that’s how the banks look at real estate these days and that would make sense with all that’s going on.  However, these items being liquidated are peoples’ homes.

Below is the graphic produced by Standard & Poor’s based upon CoreLogic’s data.  (Click to enlarge image).

Standard & Poor's Shadow Inventory 8-17-2011

It will be interesting to see if this is the big, permanent turn in the shadow inventory or if it will start to rise again as the economy slows.  We won’t know for 6-12 months unfortunately because of the way the data flows.

Filed Under: Real Estate Tagged With: , , , , , , , , ,

Plymouth, MN Foreclosure Inventory Dreadful – Fewer Than 20 Properties for Sale

August 15, 2011 By 1 Comment

There has been lots of press lately about the declining inventory of bank owned property as well as notices of foreclosure across the country as well as in the Twin Cities.  Banks have absolutely driven the market the past 3 years but perhaps that tide is about to change.  If inventory is any judge, that may be the case.

I just looked at the bank owned inventory in Plymouth, MN and all I can say is it’s dreadful!  There are only 18 properties currently for sale.  2 of them are under contract right now.  A total of 10 are single family homes and 8 are townhomes/condos.  None of them are over $300,000 with the exception that one of them is an auction property that should sell for well over $300,000 when it’s finally auctioned.  (The last purchase on it was a few years ago for over $900,000).

If you’d like this search that I just ran, please send me an e-mail and I’ll forward it to you on e-mail.  Otherwise, I’ve set up a custom search for Plymouth bank owned properties.

Related articles
Filed Under: Real Estate Tagged With: , , , , , , , , , ,
« Older Posts