help.

I agree that house appreciation plays a major role in foreclosures, but what drove that appreciation up, up and up??????

Easy money Alan. It was every where.

Easy money=people buying more houses=prices go up=people buying houses they can’t afford, but qualify for with a licensed professional, with lender underwritten easy money=values go up higher= OH NO! NO more easy money= mass foreclosures=the US economy is crashing=REALITY

http://www.boston.com/business/globe/articles/2007/12/04/falling_prices_driving_crisis/

http://www.bos.frb.org/economic/wp/wp2007/wp0715.pdf

The same study also points out that primary driver for foreclosures ain’t rate resets but: “Second, house price appreciation plays a dominant role in generating foreclosures: homeowners who have suffered a 20 percent or greater fall in house prices are about fourteen times more likely to default on a mortgage compared to homeowners who have enjoyed a 20 percent increase. We attribute most of the dramatic rise in foreclosures
in 2006 and 2007 in Massachusetts to the decline in house prices that began in the summer of 2005. Subprime lending played a role but that role was in creating a class of homeowners who were particularly sensitive to declining house price appreciation, rather than, as is commonly believed, by placing people in inherently problematic mortgages.”

Define “deserve to be saved”. The only folks who deserve to be saved who didn’t bite too much for them to chew. Who qualified at the time for FNMA 30 year fixed but were coerced to go with land mine loan. Number of these type of borrowers is in absolute minority.

OK, now to your complex questions to challenge me on my blog. You asked me questions earlier and were polite. I answered. You then attacked me in a few different comments. Fine, who cares? Now you want me to jump through your little hoops so you can get the satisfaction of proving I\’e2\’80\’99m an ass.

I will be dammed if I do and dammed if I don\’e2\’80\’99t. How do I know you’re not Angelo Mozilo and this is some counter attack on me??? haha

Well, this is the last comment/hoop I will jump through. I feel like a rabid poodle in a Bill\’e2\’80\’99s dog show.

I would rather just report how good of a shop you have and have Bill give tips to my readers. I am sure you know more than I do, if you do in fact manage or run a loss mitigation department, but there are very few people like you and even I, that know anything about this.

This blog is for the homeowner and I don’t get into all of the complicated jargin. You know as well as I that these are complex questions. This is it, I mean it Bill\’e2\’80\’a6\’e2\’80\’a6\’e2\’80\’a6\’e2\’80\’a6..

1.\tab What is the post foreclosure redemption timeline in Michigan\’e2\’80\’a6how many months long? What is the normal reason that this redemption can be shortened?

If the property is four units or less and does not exceed three acres in size, then if the amount that remains unpaid on the loan is more than two-thirds of the original debt, then the borrower still has six months to redeem. If a property is over four units or three acres and has not been abandoned, then the time period for redemption is one year from the date of the foreclosure sale. If the property has been abandoned, and if the balance is over two-thirds of the original loan, then the redemption period is one month.

2. At what amount of arrears capitalization in a loan modification does Fannie Mae require a servicer to re-record a loan modification?

Fannie Mae has changed their recording guidelines from recording $10,000.00 to $20,000.00. Fannie went from a 108% UPB to 115% UPB limit on Mods in 2007 – and many lenders up until 2007 would not allow more than 8% capitalization Fannie has taken the level to 115 and I have seen as high as 142% on Sub Prime.

3. Why does the changes in the tax code just signed yesterday make it possible for servicers to finally fix the problems?

I haven\’e2\’80\’99t thought about it till you asked. But I would guess that it means that lenders can now book their losses now and in Moe\’e2\’80\’99s words, servicers are now crapping their pants because if they do not work with borrowers and on short sales, then now all tax liabilities will be on them and not on the borrower. This leaves less skin in the game for borrowers and more for lenders.

That\’e2\’80\’99s it Bill. No more hoops please. I need to help homeowners. Why can\’e2\’80\’99t you just help me help you or vice versa or whatever. All I want is for the homeowners that want to be saved and deserve to be saved, get saved.

Moe

Once again you show that you have no real knowledge or experience in managing and handling a default mortgage and the steps towards resolution. I didn’t say customer’s don’t ask for help…What I said was that the only time that I approve a foreclosure referral is when a customer isn’t return phone calls, has filed a BK 7 and has been discharged from their personal liability of the debt, the property has been vacated and isn’t not moving towards a resolution. If no workout is pending what other choice do we have????

Distress Customers should follow the following path to start and resolve their mortgage.

1. You must understand what type of mortgage that you have. ARM, Fixed, Option ARMS and Etc
2. What is the status of your loan. How many months past due, pre-foreclosure, active foreclosure, active foreclosure with a confirmed sale date. All of these items will go into the decision process for approval of any type of workout.
3. Who is the owner of your loan (FHA, VA, Fannie, Freddie, or MBS) This will be critical in the type of workouts that can be offered.
4. Put together the following information: hardship letter, budget form (comparing your income to expenses), two paystubs, two bank statements, and tax returns.
5. Contact your servicer and find their loss mitigation, loan resolution, home retention deaprtment…..tell them that you want to keep your house and find out the process flow for a workout.
6. Send in your package to a specific person that is assigned to your file.
7. Follow-up every other day until a decision is made. Depending on the shop this might take a few weeks. Sadly at times because of the nature of your fin. position no workout can happen. If you can’t qualify for a customer based resolution (MOD, repayment plan) than you need to look at a collateral based resolution (Short Sale, DIL). This means that you help the servicer liquidate the property via sale of the asset or deeding the property back to them.
8. Remember that your servicer doesn’t want your house. They want you current and making payments monthly (Remember that is how we make money) and that each REO is a $50,000 loss waiting to happen.

In my shop we have a saying “The best customer we will ever have is the one in the house, it is our job to keep them there.”

Moe,

Let’s test your default mortgage knowledge……..since you are a self-described workout expert

1. What is the post foreclosure redemption timeline in Michigan…how many months long? What is the normal reason that this redemption can be shortened?
2. At what amount of arrears capitalization in a loan modification does Fannie Mae require a servicer to re-record a loan modification?
3. Why does the changes in the tax code just signed yesterday make it possible for servicers to finally fix the problems?

Moe this is your chance to shine…..show that you understand the issues facing the default servicing industry and the housing market. The answers to my questions are key to the resolution of the problems and why at times we can save every customer’s loan.

We are a nation of have’s and need to become one of have not’s. This is a mind set that has been perpetuated for many decades. On the backs of our future generations mind you. They are the ones that soon will here “NO” as a word they have not heard in their lifetimes. How they deal with this new phenomina will determine how well we come out of this crisis. The next generation 25+ will be the most harmed by all of this. They will drive the change and our ability as a nation to whither this storm IMO.

Voter turnout will be higher this year IMO than the last decade or more. If it isn’t then that will tell us what direction we are heading in and that won’t be pretty. If it is as I think then we have a shot at coming out of this OK… not great but OK IMHO.

And that is BS, that homeowners do not ask for help. That just shows you do not work in loss mit and your just most likely a homeowner hater that I have pissed off in some forum or someowhere.

Instead of trying to attack me, why don’t you offer some advice to the struggling homeowners that visit the blog?

Bigcityloans- Egg Nog sucks and I am feeling a bit like the grinch.

you said this, “The so-called \’e2\’80\’9chousing crisis\’e2\’80\’9d or \’e2\’80\’9ccredit crisis\’e2\’80\’9d will not lead to a depression. It is actually limited event when you look at it on a global scale.”

You are joking right? If they do not get a handle on this, it is going to do what Paulson describes as “chaos”. This is a nationwide threat and yes, the sky is falling.

Do you work in loss mit?