The state of California has announced a new program to help first time buyers buy and banks with REO's in certain areas sell those properties to the benefit of both groups. The California Housing Finance Agency has received a $200 Million allocation of bond funds for use in the Community Stabilization Home Loan Program. This will likely help between 800 and 1,000 Californians buy their first home.
It's only available for specific REO properties owned by one of the four following banks: Wells Fargo, HomeEq, CitiMortgage and Fannie Mae. All of these lenders have agreed to price the properties at 12% below market value.
The program also only applies to the following areas: the counties of Merced, San Joaquin, Riverside and Stanislaus. Also covered are certain specific Zip Codes in Alameda, Contra Costa, LA and San Bernardino counties. It will provide 30 year fixed rate loans at 5.5%, with no down payment. Borrowers must pay the expense of mortgage insurance. There are also certain income limits for borrowers. This can be found at links.sfgate.com/ZEGL .
Tuesday, July 22, 2008
Monday, July 21, 2008
The Fed Speaks!
For those of you who look at foreclosures as a possible investment, as well as anyone else looking to finance a real estate purchase, the Fed announced new regulations last week. Basically, the Fed is now requiring that banks perform full due diligence before making a real estate loan. This means that from now on, banks will be acting more responsibly in deciding who borrows and who is denied. Instead of taking a borrower's word for it on income, the lender will require proof of income. Stated income loans are, happily, a thing of the past (they never should have been allowed in the first place). Lenders will also have to be more careful in the appraisals they accept for a property.
What all of this means is that the lenders will be doing what they historically used to do before greed and stupidity took over much of the lending process.
What all of this means is that the lenders will be doing what they historically used to do before greed and stupidity took over much of the lending process.
Friday, July 11, 2008
Good News for Maryland
The state of Maryland has recently enacted some new legislation to help those facing foreclosure. In one case, homeowners will have extended periods of time to attempt to resolve their default situations before a foreclosure can be completed on their homes.
Separately, lawyers doing pro bono (free) work for homeowners facing default/foreclosure can assist in one of three ways: 1.) direct representation of the homeowner; 2.) brief assistance and advice to the owner; and 3.) Of Counsel representation. In the third case, they would act to assist regular counsel for groups offering assistance to homeowners. This initiative's importance was given added emphasis by an open letter sent to all attorneys in the state by the Chief Justice of Maryland's Court of Appeals, Justice Bell.
Finally, the State Bar has published a free booklet for homeowners on benefits under new foreclosure assistance laws in the state.
Separately, lawyers doing pro bono (free) work for homeowners facing default/foreclosure can assist in one of three ways: 1.) direct representation of the homeowner; 2.) brief assistance and advice to the owner; and 3.) Of Counsel representation. In the third case, they would act to assist regular counsel for groups offering assistance to homeowners. This initiative's importance was given added emphasis by an open letter sent to all attorneys in the state by the Chief Justice of Maryland's Court of Appeals, Justice Bell.
Finally, the State Bar has published a free booklet for homeowners on benefits under new foreclosure assistance laws in the state.
Wednesday, July 9, 2008
Governor Signs Bill in California!
Last week I mentioned that the California legislature had sent a bill to Governor Schwartzenegger providing for some preventive action, as well as tenant protection in a foreclosure.
Yesterday, July 8, the governor signed the bill, SB1137, into law. It forces lenders to contact defaulting homeowners sooner in the foreclosure process to attempt to work out some non-foreclosure resolution to the problem where possible. It also requires that once a property is foreclosed upon, the lender must provide the tenants 60 days notice to move instead of the previously mandated 30 days.
It also provides local communities the right to pass ordinances that would require the foreclosing lender to maintain the outside appearance of the property so as to avoid urban blight that often comes when a home remains vacant for a long period.
Yesterday, July 8, the governor signed the bill, SB1137, into law. It forces lenders to contact defaulting homeowners sooner in the foreclosure process to attempt to work out some non-foreclosure resolution to the problem where possible. It also requires that once a property is foreclosed upon, the lender must provide the tenants 60 days notice to move instead of the previously mandated 30 days.
It also provides local communities the right to pass ordinances that would require the foreclosing lender to maintain the outside appearance of the property so as to avoid urban blight that often comes when a home remains vacant for a long period.
Thursday, July 3, 2008
In California, Some New Help!
Yesterday, July 2, 2008, the California State Senate overwhelmingly passed and sent to Governor Schwartzenegger a bill providing some relief for homeowners facing foreclosure and for tenants in properties already foreclosed upon. The governor has indicated that he will sign the bill, which, if signed, would take effect immediately.
It would require lenders to contact homeowners by phone or in person at least 3o days before filing a Notice of Default, and also undertake discussions wit the homeowner about alternative options on repaying the loan.For tenants of foreclosed properties, the bill would increase the time before eviction of those tenants from the present 30 days to 60 days. This would give the affected tenants a bit more time to locate new quarters before having to move.
Separately, the bill also would allow local municipalities the authority to fine owners of vacant lots that are not being maintained. This is an attempt at slowing potential blight of an area that has been foreclosed upon.
It would require lenders to contact homeowners by phone or in person at least 3o days before filing a Notice of Default, and also undertake discussions wit the homeowner about alternative options on repaying the loan.For tenants of foreclosed properties, the bill would increase the time before eviction of those tenants from the present 30 days to 60 days. This would give the affected tenants a bit more time to locate new quarters before having to move.
Separately, the bill also would allow local municipalities the authority to fine owners of vacant lots that are not being maintained. This is an attempt at slowing potential blight of an area that has been foreclosed upon.
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