Prices are also stable. Again from our peak in ‘07 most cities have dropped 50% – 60% like a rock. But the past two years have been relatively stable in spite of sales gyrations, a switch from REO to short-sale dominated market, stimulus, moratoria, etc.

Now if we could only get the government out of our business we might OK. I understand this positive news doesn’t necessarily apply to the rest f the country but for our little corner of the world, among the hardest rocked by foreclosures in 2007-2008, we’re doing OK. After a brief drop in membership, we’re back to nearly our peak. And while most members are working twice as hard to make half as much, at least there’s a little good news.

SACRAMENTO – Senate Republican Leader Dennis Hollingsworth (R – Murrieta), talks about how Democrats’ insistence that tax increases be part of the budget deal is discouraging job growth, and prolonging the recession in this week’s Senate Republican Radio Address.

Links to audio versions of the address, and a transcript, are included below:

English Version: http://cssrc.us/audio/100716_SenRepAdd.mp3
Spanish Version: http://cssrc.us/audio/100716_SenRepAdd_esp.mp3

TRANSCRIPT:

Yet another week has gone by without passing a balanced budget for California. That’s because rather than reducing spending to match what we have, the Legislature’s Democrat majority insists on including billions of dollars of job killing tax increases to close the state budget gap.

Now, just 18 months ago Californians were saddled with the largest tax increase in history. As republicans predicted, that huge tax increase stifled economic growth and resulted in further job layoffs in private businesses.

And the economic news keeps getting worse. A survey this week from the National Federation of Independent Business shows small business owners aren’t planning to hire new employees or buy new equipment because of the threat of further taxes and more government regulation. Now, how could even higher taxes possibly be a good idea for a budget plan?

Small businesses are California’s economic engine and should be driving the economic recovery.

Instead, because Democrats insist on job-killing tax increases, California’s unemployment rate is nearly 30 percent higher than the national average.

The right state budget must reduce spending, be balanced with no new taxes, and most important of all, it must encourage private-sector job creation.

I am Senate Republican Leader Dennis Hollingsworth: Thank you for listening.

NAR submitted comments on a U.S. Department of Energy (DOE) proposal to create a voluntary energy performance label for homes.  The DOE issued a request for information on a proposed National Energy Rating Program for Homes.  The stated purpose of the request for information was “…..to develop a voluntary energy rating program for homes…..that will grow jobs, save homeowners money on their energy bills, help avoid emssions of greenhouse gases and improve energy security.”

In the comments, NAR lauded the DOE for emphasizing the voluntary nature of the proposal.  However, NAR also raised concerns regarding the difficulty of developing national guidelines that would accurately measure energy use and performance in something has complicated and varied as a house, the complications this kind of nformation could cause in the real estate transaction and the negative impacts that comparing energy use of different homes could have on fragile real estate markets.  According to NAR’s comments: “Labeling every structure in America will not, in and of itself, improve the energy efficiency of homes or buildings…..Energy labels stigmatize older properties and make it harder for these individuals to build equity. Labels also reduce sales prices when sellers are forced into negotiated price reductions in order to compete in today’s very competitive buyer’s market.”
NAR’s comments are attached.  DOE will provide additional opportunities for input, feedback and comment as they develop their voluntary National Energy Rating Program for Homes, and NAR will ensure that ensure that the Realtor perspective is considered during that process.

(See attached file: 07.08.10 Natl Energy Rating Program RFI Comment Letter.pdf)

Reform bill retools lending

The Senate passed the financial regulation bill today, which will impact home buyers and lending guidelines.  Chief among the changes impacting consumers is the creation a consumer bureau at the Federal Reserve and the requirement that lenders ensure a borrower is able to repay a home loan by verifying income, employment, and credit history.
MAKING SENSE OF THE STORY FOR CONSUMERS

• Under the financial regulation bill, at least two categories of mortgages likely will see a dramatic decrease in their availability: interest-only loans and stated-income loans.  Both loan types likely would fall short of the government’s definition of “qualified” mortgages and therefore be avoided by many in the lending community.
• Many real estate analysts credit interest-only loans and stated-income loans as contributing factors to the decline of the housing market.  With interest-only loans, borrowers pay none of the loan principal for a fixed period, typically 10 years, after which time they must make higher payments for the remaining 20 years of the loan.  Unlike other loan products, stated-income loans do not require borrowers to verify their actual income.  Only a few lenders continue to offer these loans, and typically only to borrowers with deep cash reserves and large down payments.
• The bill also severely limits the industry practice known as “yield spread premiums,” which in many cases incentivized mortgage brokers and loan officers to sell higher-interest loans to borrowers.  The reform bill will no longer allow commissions earned by mortgage brokers and loan officers to be linked to the interest rate, but rather the loan amount.  Once the bill takes effect, the total commission and additional fees charged by lenders and others in the mortgage process will be limited to a maximum of 3 percent of the loan amount, not including the real estate commission.

To read the full story, please click here.

Goodbye, Home Valuation Code of Conduct

Legislation will overhaul appraisal rules

By Matt Carter, Friday, July 16, 2010.

Inman News

Appraisers are welcoming Thursday’s passage of legislation that makes sweeping changes to the nation’s financial regulatory system, saying the bill includes the first modernization of real estate appraisal regulations in more than 20 years.

HR 4173, the Dodd-Frank Wall Street Reform and Consumer Protection Act, includes appraisal independence requirements and provides grant funding for state oversight and enforcement of those regulations.

The bill creates a new Bureau of Consumer Financial Protection that’s charged — among many things — with drafting new interim final regulations that specifically define acts or practices that violate the bill’s appraisal independence requirements.

The regulations are to be drafted within 90 days of the bill’s signing, superseding the Home Valuation Code of Conduct, rules adopted by Fannie Mae and Freddie Mac in May 2009.

Realtors have complained that the code, which was intended to protect appraisers from coercion by lenders, has resulted in lenders relying more on appraisal management companies (AMCs) that may employ appraisers with little experience in the markets in which they are asked to provide valuations, paying them less than experienced local appraisers.

Fannie and Freddie on June 30 put lenders on notice that they must use appraisers with local experience who can access records on recent sales in markets where they are being asked to provide valuations.

The appraisal independence requirements of HR 4173 provide that AMCs register with state agencies, and stipulate that lenders and AMCs pay “reasonable and customary” fees to appraisers. Violators will be subject to penalties under the Truth in Lending Act.

The new law allows lenders to establish what’s “reasonable and customary” by citing “objective third-party information, such as government agency fee schedules, academic studies, and independent private-sector surveys.” But fee studies can’t include assignments ordered by AMCs.

The Appraisal Institute, a group representing appraisers, says that language will encourage the use of “highly trained and competent appraisers.”

“We encourage AMCs to justify the legitimate services they are providing to lenders by charging for those services, rather than penalizing highly trained and competent appraisers” by offering subpar wages, Appraisal Institute President Leslie Sellers said in a press release.

The banking and lending industry is wary of many of the bill’s other provisions, saying they will create more costs and tighten the availability of credit to consumers.

After the House passed the bill on June 30, the Mortgage Bankers Association issued a statement saying the bill would change mortgage lending, increasing costs and creating new regulatory burdens that would affect consumers and lenders.

Lenders’ concerns about the bill include risk retention provisions for loan originators and the lack of strong federal preemption of state consumer protection laws, preserving the rights of states to pass even stronger measures.

According to one analysis by attorneys at K&L Gates, the bill “essentially mandate(s) that all flavors of mortgage loans besides ‘plain vanilla’ will disappear from the menu.”

For consumers who want something besides staid 30-year fixed-rate loans and other loans viewed as less risky? “Sorry, the government has determined that it may be hazardous to your health,” K&L Gates attorneys Kristie Kully and Lawrence Platt wrote.

Although the lending industry won some concessions in the long fight over financial regulatory reform, “the extent to which makers and holders of non-plain vanilla mortgages are targeted for punishment through enhanced monetary damages, defenses to foreclosure, and risk retention requirements,” came as a surprise, Kully and Platt said.

“Only time will tell whether the mortgage finance industry will assume the risks and expand the menu of mortgage options.”

Commenting on Thursday’s Senate passage of HR 4173 in a 60-39 vote, the American Bankers Association said the group was “very disappointed” with bill, calling it “overloaded with new rules and restrictions on traditional banks that did not cause the financial crisis. The result will be over 5,000 pages of new regulations on traditional banks and years of uncertainty as to what the massive new rules will mean.”

On that point, the National Community Reinvestment Reinvestment Coalition did not disagree.

The proof of the bill’s worth “will come not from what is written in the bill, but how the regulators interpret the bill, write the rules and then enforce them,” said John Taylor, NCRC’s president and CEO, in a statement. The bill leaves “too much to study, and (up to) the discretion of the existing regulators.”

NCRC welcomed beefed-up reporting requirements under the Home Mortgage Disclosure Act that will require lenders to include more details on loan terms and conditions and borrower characteristics to regulators. That information can be used to determine whether lenders are discriminating against minority borrowers or underserving some communities.

The bill also creates a default and foreclosure database that NCRC said will “serve as an early warning system” allowing regulators to take action when data shows a spike in foreclosures

Regulators will also have access to a database of individual loan records for homeowners participating in the Home Affordable Modification Program (HAMP) program, which NCRC said will increase industry accountability for loan modifications.

The National Association of Realtors largely stayed on the sidelines of the battle over financial reform, after lawmakers made it clear last year that the Consumer Financial Protection Agency they envisioned would not have authority over real estate agents and brokers, or other businesses that bill customers after services are provided, such as doctors and lawyers.

Speaking on a panel at Inman News’ Real Estate Connect San Francisco Thursday, NAR CEO Dale Stinton said the group was focused on the Obama administration’s next project: determining the fate of Fannie Mae and Freddie Mac, and the future of the secondary mortgage market.

“On the consumer side, we try to pick our fights, and that wasn’t our fight,” Stinton said, noting that the U.S. Chamber of Commerce was an advocate for businesses during the debate.

Stinton said that 25 years ago, a previous NAR CEO made a public appeal for the government to implement spending reductions to tackle the national deficit. NAR “paid the price for 10 years for putting our nose where it didn’t belong,” Stinton said.

Appearing onstage at Connect with Stinton, ForeclosureRadar.com founder and CEO Sean O’Toole said that loose lending standards and mortgage products like pay-option adjustable-rate mortgages with low interest rates artificially inflated home prices during the boom by allowing people to buy more home than they could really afford.

But the root of the problem was the loose lending standards employed by lenders because they were able to pass risk along to secondary market investors — not the loan products themselves, O’Toole said.

“I’m not sure subprime lending isn’t OK … we’re going to lose a lot of good products that could expand homeownership, ” O’Toole said.

“I think all of these products could be on the market” if lenders were partners with borrowers in a home, sharing the risk. One way to do that would be to bar deficiency judgements against borrowers who default on their mortgage, O’Toole said.

The American Land Title Association was pleased that the HR 4173 does not place title insurance under the jurisdiction of the Bureau of Consumer Financial Protection, as originally proposed by the Obama administration.

The bill does create a new Federal Insurance Office within the Treasury Department, which will have the authority to determine when state insurance regulations are inconsistent with international agreements relating to prudential measures for insurance or reinsurance, ALTA said.

NAR Legal Affairs has learned of a new scheme designed to trick unwary real estate professionals

NAR Legal Affairs has learned of a new scheme designed to trick unwary real estate professionals into forwarding money to the scheme operators. The scheme works in the following manner:

• Salesperson receives an inquiry via email from an individual who identifies himself (no known female aliases yet) as a wealthy individual seeking a residential property. The individual lives outside the market area, and usually outside of the country. The individual operates under a variety of aliases, and also varies his housing requirements. Sometimes he is married with children, sometimes he is single.
• The emails are written in a choppy fashion with incorrect grammar usage, suggesting English is not the writer’s first language. The emails also rarely contain any information relevant to the market in which he is seeking a home and are written in a generic style.
• The individual claims to hold an important position at an existing business, although no one with the individual’s name actually is listed as working for the business.

If the real estate professional responds to the inquiry and sends the individual listing information, the following actions take place:

• The alleged buyer selects the most expensive property from the listings that he receives and instructs the real estate professional to submit an offer for the property, stating that he will visit the property in the near future.
• He represents that the transaction will be an all cash transaction, and no title company should be involved.
• He requests the information that he needs to write on the deposit check, and states that the check will be sent either to the real estate brokerage or to an attorney.
• He will also send a forged bank (or brokerage) statement, showing significant assets, in addition to a copy of a forged ID.

If the Salesperson provides this information, the real estate professional (or attorney) will receive a check larger than the deposit amount. The reason for the higher amount will be attributed to something like needing funds for furnishing the new home. If the check is cashed, the alleged buyer will immediately withdraw the overage amount. The real estate professional’s bank will present the initial check for payment, and will then be told it is forged. Therefore, the real estate professional will lose the overage amount taken by the individual, as the trail of money is usually untraceable once it is withdrawn from the brokerage’s escrow account.

If you receive this email, you should ignore it and forward it to your local FBI office- SCAM@ic.fbi.gov

FHFA ISSUES STATEMENT ON PACE LOAN PROGRAMS
The Federal Housing Finance Agency (FHFA) issued a statement today concerning energy retrofit lending programs that are finances through a county or city’s tax assessment regime.  The so-called Property Assessed Clean Energy (PACE) programs allow homeowners to finance energy retrofit improvements to their homes through an assessment on their property tax bill.  They have created concerns because the loans acquire priority lien over existing mortgages.

In the statement, FHFA directs Fannie Mae, Freddie Mac and the Federal Home Loan Banks to follow certain guidelines concerning the PACE loans.  These allow the agencies to purchase mortgages on properties that previously acquired a PACE loan with a first-lien position.  However, the agencies are directed to develop new underwriting guidelines going forward.  For these new loans, the agencies will be required to adjust loan-to-value and debt-to-income ratios to reflect the “maximum permissible” PACE loan amount available to borrowers.

More info:
http://www.fhfa.gov/webfiles/15884/PACESTMT7610.pdf

Proposition 18
Bond Measure
SBx7 2. (Chapter 3, 2009), Cogdill.

Safe, Clean, and Reliable Drinking Water Supply Act of 2010

Proposition 19
Initiative Statute
1377. (09-0024. Amdt. #1S) – Final Random Sample Update – 03/24/10

Changes California Law to Legalize Marijuana and Allow It to Be Regulated and Taxed.

Qualified: 03/24/10

Proponents: Richard Seib Lee and Jeffrey Wayne Jones (510) 208-4554

Allows people 21 years old or older to possess, cultivate, or transport marijuana for personal use. Permits local governments to regulate and tax commercial production and sale of marijuana to people 21 years old or older. Prohibits people from possessing marijuana on school grounds, using it in public, smoking it while minors are present, or providing it to anyone under 21 years old. Maintains current prohibitions against driving while impaired. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local governments: Savings of up to several tens of millions of dollars annually to state and local governments on the costs of incarcerating and supervising certain marijuana offenders. Unknown but potentially major tax, fee, and benefit assessment revenues to state and local government related to the production and sale of marijuana products. (09-0024.) (Full Text)

Proposition 20
Initiative Constitutional Amendment
1380. (09-0027) – Final Random Sample Update – 05/05/10

Redistricting of Congressional Districts.

Qualified: 05/05/10

Proponent: Charles T. Munger, Jr. votersfirstactforcongress@gmail.com

Removes elected representatives from the process of establishing congressional districts and transfers that authority to the recently-authorized 14-member redistricting commission. Redistricting commission is comprised of five Democrats, five Republicans, and four voters registered with neither party. Requires that any newly-proposed district lines be approved by nine commissioners including three Democrats, three Republicans, and three from neither party. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Probably no significant change in state redistricting costs. (09-0027.) (Full Text)

Proposition 21
Initiative Statute
1421. (09-0072) – Final Random Sample Update – 06/10/10

Establishes $18 Annual Vehicle License Surcharge to Help Fund State Parks and Wildlife Programs and Grants Free Admission to All State Parks to Surcharged Vehicles.

Qualified: 06/10/10

Proponent: Joseph L. Caves (916) 558-1516

Establishes an $18 annual state vehicle license surcharge and grants free admission to all state parks to surcharged vehicles. Requires deposit of surcharge revenue in a new trust fund. Requires that trust funds be used solely to operate, maintain and repair the state park system, and to protect wildlife and natural resources. Exempts commercial vehicles, trailers and trailer coaches from the surcharge. Requires annual independent audit and review by citizen’s oversight committee. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Increased state revenues of about $500 million annually from the imposition of a surcharge on the VLF to be used mainly to fund state parks and wildlife conservation programs. Potential state savings of up to approximately $200 million annually to the extent that the VLF surcharge revenues were used to reduce support from the General Fund and other special funds for parks and wildlife conservation programs. Reduction of about $50 million annually in state and local revenues from state park day-use fees. These revenue losses could potentially be offset by increases in other types of state park user fees and revenues. (09-0072.) (Full Text)

Proposition 22
Initiative Constitutional Amendment.
1414. (09-0063, Amdt.#1NS) – Final Random Sample Update – 06/22/10

Prohibits the State from Taking Funds Used for Transportation or Local Government Projects and Services.

Qualified: 06/22/10

Proponents: Joshua Shaw, Christopher K. McKenzie, and James N. Earp

Prohibits the State from shifting, taking, borrowing, or restricting the use of tax revenues dedicated by law to fund local government services, community redevelopment projects, or transportation projects and services. Prohibits the State from delaying the distribution of tax revenues for these purposes even when the Governor deems it necessary due to a severe state fiscal hardship. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Significant constraints on state authority over city, county, special district, and redevelopment agency funds. As a result, higher and more stable local resources, potentially affecting billions of dollars in some years. Commensurate reductions in state resources, resulting in major decreases in state spending and/or increases in state revenues. (09-0063.) (Full Text)

Proposition 23
Initiative Statute
1454. (09-0104) – Final Random Sample Update – 06/22/10

Suspends Air Pollution Control Laws Requiring Major Polluters to Report and Reduce Greenhouse Gas Emissions That Cause Global Warming Until Unemployment Drops Below Specified Level for Full Year.

Qualified: 06/22/10

Proponent: Thomas W. Hiltachk (916) 442-7757

Suspends State laws requiring reduced greenhouse gas emissions that cause global warming, until California’s unemployment rate drops to 5.5 percent or less for four consecutive quarters. Requires State to abandon implementation of comprehensive greenhouse-gas-reduction program that includes increased renewable energy and cleaner fuel requirements, and mandatory emission reporting and fee requirements for major polluters such as power plants and oil refineries, until suspension is lifted. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Potential positive, short-term impacts on state and local government revenues from the suspension of regulatory activity, with uncertain longer-run impacts. Potential foregone state revenues from the auctioning of emission allowances by state government, by suspending the future implementation of cap-and-trade regulations. (09-0104.) (Full Text)

Proposition 24
Initiative Statute.
1412. (09-0058, #1NS) – Final Random Sample Update – 06/24/10

Repeals Recent Legislation That Would Allow Businesses to Carry Back Losses, Share Tax Credits, and Use a Sales-Based Income Calculation to Lower Taxable Income.

Qualified: 06/24/10

Proponents: Robin Johansen and Karen Getman (510) 346-6200

Repeals recent legislation that would allow businesses to shift operating losses to prior tax years and that would extend the period permitted to shift operating losses to future tax years. Repeals recent legislation that would allow corporations to share tax credits with affiliated corporations. Repeals recent legislation that would allow multistate businesses to use a sales-based income calculation, rather than a combination property-, payroll- and sales-based income calculation. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Annual state revenue increase from business taxes of about $1.7 billion when fully phased in, beginning in 2011-12. (09-0058.) (Full Text)

Proposition 25
Initiative Constitutional Amendment.
1408. (09-0057) – Final Random Sample Update – 06/24/10

Changes Legislative Vote Requirement to Pass a Budget from Two-Thirds to a Simple Majority. Retains Two-Thirds Vote Requirement for Taxes.

Qualified: 06/24/10

Proponents: James C. Harrison and Thomas A. Willis (510) 346-6200

Changes the legislative vote requirement necessary to pass the state budget from two-thirds to a simple majority. Provides that if the Legislature fails to pass a budget bill by June 15, all members of the Legislature will permanently forfeit any reimbursement for salary and expenses for every day until the day the Legislature passes a budget bill. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Unknown changes in the content of the state budget from lowering the legislative vote requirement for passage. Fiscal impact would depend on the composition and actions of future Legislatures. Minor reduction in state costs related to compensation of legislators in years when the budget bill is passed after June 15. (09-0057.) (Full Text)

Proposition 26
Initiative Constitutional Amendment.
1441. (09-0093) – Final Random Sample Update – 06/24/10

Increases Legislative Vote Requirement to Two-Thirds for State Levies and Charges. Imposes Additional Requirement for Voters to Approve Local Levies and Charges with Limited Exceptions.

Qualified: 06/24/10

Proponent: Allan Zaremberg c/o Steve Lucas (916) 446-6752

Increases legislative vote requirement to two-thirds for state levies and charges, with limited exceptions, and for certain taxes currently subject to majority vote. Changes Constitution to require voters to approve, either by two-thirds or majority, local levies and charges with limited exceptions. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Potentially major decrease in state and local revenues and spending, depending upon future actions of the Legislature, local governing bodies, and local voters. (09-0093.) (Full Text)

Proposition 27
Initiative Constitutional Amendment and Statute.
1451. (09-0107) – Final Random Sample Update – 06/24/10

Eliminates State Commission on Redistricting. Consolidates Authority for Redistricting with Elected Representatives.

Qualified: 06/24/10

Proponent: Daniel Lowenstein c/o Fredric D. Woocher (310) 576-1233

Eliminates 14-member redistricting commission selected from applicant pool picked by government auditors. Consolidates authority for establishing state Assembly, Senate, and Board of Equalization district boundaries with elected state representatives responsible for drawing congressional districts. Reduces budget, and imposes limit on amount Legislature may spend, for redistricting. Provides that voters will have the authority to reject district boundary maps approved by the Legislature. Requires populations of all districts for the same office to be exactly the same. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Likely decrease in state redistricting costs totaling several million dollars every ten years. (09-0107.) (Full Text)

NAR worked closely with Congressional leaders on both sides of the aisle to enact this important legislation. Extending the Tax Credit Closing deadline will help provide additional stability to real estate markets across the nation.

For additional information on the extension visit www.realtor.org/government_affairs

Additionally, the United States Senate has passed the National Flood Insurance Program Extension Act of 2010 (H.R. 5569) an extension of the National Flood Insurance Program until September 30, 2010.  This will allow transactions to move forward.  The bill is retroactive and covers the lapse period from June 1, 2010 to the date of enactment of the extension.

For more information on the flood insurance program visit www.realtor.org/government_affairs

Up to 180,000 home buyers will lose their tax credit through no fault of their own if Congress fails to pass an extension to the home buyer tax credit by June 30 when the closing deadline expires. Included in that number are thousands of home buyers in every state of the union, from 390 in Wyoming to 17,700 in California, according to estimates by the National Association of Realtors®.

“We are strongly urging the Senate and the House to act quickly to pass this legislation and ease the minds and pocketbooks of these home buyers,” said NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz.

“These are not buyers who just entered into the market. These are buyers who previously met all the qualifications for the tax credit, but find themselves at the mercy of a workflow jam with lenders or other delays such as lapses in the National Flood Insurance Program, Rural Housing Service, and new home construction, and might not be able to complete the purchase of their homes by the current deadline,” said Golder. “It would be a tragedy for them not to be able to complete the purchase in time to claim the credit.”

NAR issued the following state-by-state estimate of the number of home sales that would be delayed beyond the June 30 deadline; numbers are rounded to the nearest 10:

Alabama, 2,590; Alaska, 830; Arizona, 5,440; Arkansas, 2,090; California, 17,700; Colorado, 3,390; Connecticut, 1,770; Delaware, 400; District of Columbia, 300; Florida, 14,830; Georgia, 6,270; Hawaii, 710; Idaho, 1,270; Illinois, 7,030; Indiana, 3,560; Iowa, 2, 030; Kansas, 1,840; Kentucky, 2,540; Louisiana,1,800; Maine, 840; Maryland, 2,630; Massachusetts, 3,930; Michigan, 6,470; Minnesota, 3,760; Mississippi, 1,530; Missouri, 3,600; Montana, 760; Nebraska, 1,110; Nevada, 3,800; New Hampshire, 690; New Jersey, 4,300;

New Mexico, 1,160; New York, 9,190; North Carolina, 4,890; North Dakota, 460; Ohio, 8,510; Oklahoma, 2,760; Oregon, 2,090; Pennsylvania, 5,830; Rhode Island, 500; South Carolina, 2,460; South Dakota, 500; Tennessee, 3,910; Texas, 15,340; Utah, 1,130; Vermont, 400; Virginia, 3,890; Washington, 3,190; West Virginia, 940; Wisconsin, 2,690; and Wyoming, 390.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.

Here are the latest details on the Tax Credit Closing Deadline:

Our best advice to members with questions and concerns is to proceed as if the June 30, 2010 date is binding.

NAR is pursuing all possible options with senior congressional staff to determine what other legislation may be available for passing a June 30 extension.  Each of the possible options face difficult obstacles, but NAR’s efforts to clear the way are on going.

The Senate will NOT have any votes today (Friday, June 25) this will push the Tax Credit Extension deadline to the week of June 28, 2010.

Should Congress extend the date, information will be posted on www.realtor.org/government_affairs as soon as it happens.

The final outcome will be posted on www.realtor.org/government_affairs on July 1, 2010.

That’s  a headline that would reach and and grab you over your oatmeal, wouldn’t it? It certainly caught my attention yesterday. Here’s a new program (4 actually) designed to help homeowners avoid foreclosure  and the Department of Treasury has just approved $700 Million of those old leftover TARP funds just for us in California. The article went on to say it’s to help:

• unemployed homeowners in danger of defaulting on their loans (lenders must match federal funds)
• borrowers who are a little behind on their mortgage but could catch up with a little help (lenders must match)
• reduction in principle for borrowers needing it to avoid foreclosure (lenders must match)
• transition assistance for families who can’t afford to keep their home.

I guess if I had any faith in any program the government was trying to foist on us right now this sounds like it has possibilities. I mean, who knew there was still a spare $700 million in TARP funds laying around for just one state over a year into the program. That program, along with all the other great unveilings like HAFA, HARP, HAMP, etc, have been such resounding successes you’d have thought the money would already have been used up to stimulate the economy. At least the Administration will tell you that’s why our jobs & housing market are roaring along so robustly right now.

Of course I don’t have much faith in anything the government is doing right now and wish they’s simply get the hell out of the housing business. This is no different. CalHFA’s Keep You Home Program plans to use the money to develop those four programs, oh, out around November 1. When? People are hurting TODAY. The money is available TODAY. The programs may be available in 4 months?  Well, yeah. There’s that government sense of urgency thing.

And that’s assuming they can get the lenders to match up to $700 million in order for homeowners to qualify. You think lenders in California are gonna just pony up another $700 million? Wasn’t TARP supposed to go to lenders to begin with?

Oh well, don’t hold your breath. Even the CalHFA spokeshole cautioned people not to get their hopes up. “We recommend that if homeowners are currently having financial difficulties, they do not wait for these programs.” They should contact lenders and HUD counselors to see if they can make use of one of the other worthless programs being touted by the administration or get screwed over by a loan mod or short sale scam artist. He also had no additional advice for those that have already been hosed by lenders and counselors and need assistance before the programs might start. He encouraged people to visit their website http://keepyourhomecalifornia.com/. Here you can find out about how close you came to actually getting assistance including a great quote from our Governor about the new future program “The new funding announced today will play a vital role in aiding the state’s neediest homeowners. Blah, blah blah blah blah KawLeeForKneeya.”

Read beyond the headlines folks. There’s no free lunch, the check is in the mail and we’re from the government and we’re here to help you – provided you can hang on until November.

The position has been detailed in a much-hyped white paper by University of Arizona Professor Brent White which I explored some time back in Social Control of the Housing Crisis vs Strategic Default. It can be a tough argument to refute – when somebody is making payments on a home they bought for $600,000 while their neighbor just bought the same property as an REO for $285,000. The only thing keeping them there is the sense of moral obligation because they are honorable folks who signed a contract and gave their commitment that they would. At what financial point does that moral obligation start to break down? And if you can make the argument that the lenders themselves had some culpability in the run-up and subsequent collapse (an argument that is pretty easily made), then does that provide even further justification for underwater homeowners to simply bail?

Now Fannie Mae has decided to ‘put some teeth’ into their enforcement and take some pre-emptive action on strategic defaults in what they’re terming a ‘get tough’ strategy. They have notified their lenders that effective next month they should begin monitoring loans facing foreclosure and issuing recommendations in cases that might constitute strategic default for possible pursuit through deficiency judgments. Of course deficiency judgments only work in states that allow such a thing. California doesn’t so that avenue is closed off to them here. They can still pursue deficiency judgments here if the owner re-fi’d but the California Association of Realtors is looking to shut down that avenue as well with SB1178, which just passed the Senate and is working through the Assembly as we speak. Of course as I’ve explained that one before, if you did a cash-out refi, you’ll still be on the hook but if you re-fi’d just to get a better interest rate you’ll dodge another bullet the lenders are aiming your way.

So what else has Fannie got up there sleeve for this get-tough policy? Well, if it appears you exercised a strategic default then Fannie will not guarantee anothernloan for you for 7 years. As of right now, the policy is if you exercise your options for a loan-mod, short-sale or deed-in-lieu, and can show extenuating circumstances (job loss, illness or divorce), then Fannie might give you a new loan in as little as 2-3 years with 10% down, 20% down if you exercised your options but have no extenuating circumstances.

Is that enough get-tough toothiness to make a difference? Well, if Freddie joins in it could be. With the government backing or directly involved in 95% of the mortgage market today, that could be sufficient incentive to try to work within the system instead of dumping on the system. Innstates where there is recourse it’s even tougher – although there’s a reason why most lenders avoid judicial foreclosure as an option today. It’s expensive and time consuming and leaves savvy homeowners in their homes free far longer than otherwise. With the nationwide average already running 18 months, does Fannie really want to stretch that out even more?

Well, I certainly don’t have the answers to that – it’s tough enough coming up with the questions. Having just gone through an exercise in financing myself, I can’t imagine a much more exhausting, convoluted scenario of an industry in disarray. Then you have to wonder if Fannie will even be here next year or if this is just a last ditch effort to forestall the wave that would put them under.

If you’re $400,000 upside-down in your home I’d love to hear what you think and why you’re gritting it out.

LOS ANGELES – Attorney General Edmund G. Brown Jr. today joined the California Department of Real Estate and the State Bar of California to warn homeowners about an alarming rise in short sale fraud across California in a field “rife with scam artists”.

A short sale is an arrangement in which a homeowner sells his or her home for less than the outstanding mortgage, with the consent of the lender.

“While short sales can provide homeowners with a last-ditch alternative to foreclosure, this market is rife with scam artists,” Brown said. “Homeowners and buyers, agents, and lenders should beware of short sale negotiators who operate without licenses, use straw buyers or charge illegal fees.”

With so many homeowners now considering short sales, an entire industry of so-called short sale negotiators has emerged. These individuals solicit homeowners by promising to expedite the process and help coax lenders into taking part in the transaction.

The Department of Real Estate is investigating more than 40 complaints of short sale fraud, up from “virtually zero” cases only three months ago, a spokesman said.

In April, the Obama administration launched a new initiative called the Home Affordable Foreclosure Alternatives Program, which encourages homeowners in financial distress — especially those who have failed to complete a trial modification or qualify for a loan modification — to consider a short sale as an alternative to foreclosure.

Before working with — or paying — any short sale negotiator, homeowners should consider the following red flags:

No license
With limited exceptions, only licensed real estate agents or attorneys can engage in short sale negotiations with a homeowner’s lender.

Up-front fees
Licensed real estate agents wishing to collect up-front fees from homeowners for short sale transactions must first submit an advance fee contract to the Department of Real Estate and receive a no-objection letter.

Surcharges
With many distressed properties listed well below market value, negotiators and agents are charging potential buyers thousands of dollars in surcharges and hidden fees just to place an offer on a home. These illegal fees are frequently not disclosed and are paid outside escrow.

Straw buyers and house flipping
In this scheme, short sale negotiators misrepresent the market value of a property to a homeowner’s lender by only submitting offers on the property from an affiliated straw buyer. After the home is purchased below market value, the fraudsters immediately flip it and pocket the difference.

Short sale negotiators and agents use a number of titles including debt negotiator, debt resolution expert, loss mitigation practitioner, foreclosure rescue negotiator, short sale processor, short sale coordinator and short sale expeditor.

If you are a homeowner who has been scammed, contact Brown’s office at 1-800-952-5225 or file a complaint online at: www.ag.ca.gov/consumers/general.php.

Homeowners can also learn more about avoiding mortgage and real estate fraud by visiting the Department of Real Estate website at: http://www.dre.ca.gov/cons_alerts.html. A complaint form can be accessed online at: http://www.dre.ca.gov/frm_consumer.html.

“Short sale fraud appears to be the fraud of the moment, and it is proliferating statewide,” according to Real Estate Commissioner Jeff Davi. “Consumers, licensees and lenders must all arm themselves with the tools necessary to avoid such scams.”

Homeowners can file a complaint against a lawyer, a legal specialist or a company purporting to operate as a law firm with the State Bar by calling 1-800-843-9053 or visiting: www.calbar.ca.gov.

Homeowners can learn more about the federal government’s Home Affordable Foreclosure Alternatives Program by visiting: http://makinghomeaffordable.gov/hafa.html.

Non-profit housing counselors certified by the U.S. Department of Housing and Urban Development are also available to provide free help to homeowners. To find a counselor in your area, call 1-800-569-4287.

REGIONAL LAW ENFORCEMENT JOINS TOGETHER IN CRACKDOWN ON

MORTGAGE FRAUD, WITH SEVERAL DOZEN BEING NAMED IN CRIMINAL AND

CIVIL ACTIONS FILED IN FEDERAL COURT

Federal and local law enforcement officials joined together this morning to announce a series of cases that have resulted from coordinated efforts to target fraud in the mortgage loan industry. As part of a nationwide crackdown, federal prosecutors in Los Angeles, Riverside and Orange Counties worked with local and federal investigators to bring criminal charges against a wide range of individuals involved in mortgage fraud, including borrowers, “straw borrowers,” corrupt real estate professionals, bank employees who help facilitate fraud, and those who prey upon distressed homeowners.

In addition to recently filed criminal cases that charge about three dozen defendants, the Civil Division of the United States Attorney’s Office this week filed five civil lawsuits that allege mortgage fraud, including one case in which prosecutors are seeking an immediate order from a judge to shut down an organization allegedly engaged in an ongoing scheme that is defrauding the federal government.

“Over time, we have seen repeated spikes of fraud targeting financial institutions.  Over the last decade, we saw one of those spikes as mortgage fraud blossomed with the housing bubble,” said United States Attorney André Birotte Jr. “ When the bubble burst, in part because of fraud permeating the system, the effects were felt around the world. We are now sorting the through the wreckage to identify and prosecute the most egregious offenders. We are also targeting those who continue to exploit the system by fraudulently obtaining new loans or by bilking upside-down homeowners through loan modification and rescue scams.

As part of its enforcement efforts, the United States Attorney’s Office is working collaboratively with a number of law enforcement partners to use all available resources and bring to justice as many criminals as possible. This morning, arrests were made in two federal cases involving mortgage fraud in Ventura. The matters were initially reviewed by the Ventura County District Attorney’s Office, and the investigations grew to include agents from the Federal Bureau of Investigation, the U.S. Department of Housing and Urban Development’s Office of Inspector General of, U.S. Immigration and Customs Enforcement, the Secret Service, IRS-Criminal Investigation, as well as District Attorney investigators. (i.e. conspicuous by their absence is the Riverside District Attorney’s Office – even though one of the biggest indictments is in our turf.)

The two cases involving mortgage fraud in Ventura name a total of 14 defendants, all of whom face potential sentences of hundreds of years in prison if they are convicted in the schemes that cumulatively helped unqualified and straw borrowers obtain tens of millions of dollars in fraudulent mortgage loans. But this is only one of several cases that seek to address the mortgage fraud problem from different angles.

●       In a civil action filed yesterday, prosecutors are seeking up to $1 million in damages from several real estate professionals allegedly involved in an ongoing scheme to obtain government-insured mortgage loans for unqualified borrowers. The complaint seeks a preliminary injunction that would shut down the allegedly fraudulent operation being run out of The Team Realty Group in Riverside. The complaint alleges that, for the past three years, Peter Morris, a California licensed real estate broker, and other professionals working at Morris’ Team Realty Group submitted bogus documents to banks to make their clients appear to be eligible for mortgage loans insured by the Federal Housing Authority or the Veteran’s Administration. The complaint, which is one of five civil actions filed this week by the United States Attorney’s Office, was filed pursuant to the Financial Institutions Reform Recovery and Enforcement Act of 1989 (FIRREA), which became law in the wake of the savings and loan crisis and gave the Justice Department flexibility to pursue civil penalties, as well as criminal charges, against individuals involved in mortgage fraud.

●       In a criminal case indicted yesterday by a federal grand jury in Santa Ana, the owners of a mortgage brokerage firm are accused of obtaining more than $30 million in loans by submitting hundreds of loan applications that substantially inflated the borrowers’ true income and assets.

●       A Lancaster man pleaded guilty last month to conspiracy and making false statements for his role in a scheme to defraud homeowners by promising to delay or prevent foreclosures on their homes and pay-off delinquent mortgages in exchange for the homeowners making payments and transferring title.

Ellon Lindsey, Assistant Special Agent in Charge of IRS – Criminal Investigation’s Los Angeles Field Office, observed: “Mortgage fraud hurts our communities, drives some homebuyers into foreclosure, leaves lenders with bad loans, and burdens neighborhoods with deteriorating and abandoned properties. Today, IRS – Criminal Investigation is pleased to be a part of the numerous investigations that have successfully attacked these crimes on a variety of fronts. Using federal laws that include wire fraud, money laundering and tax offenses, we are able to successfully disrupt these schemes and bring their promoters to justice.”

The court cases that have been brought and resolved as part of the ongoing crackdown are the result of the collaborative efforts of a number of law enforcement agencies, including the United States Attorney’s Office, the Federal Bureau of Investigation, the Office of Inspector General for the United States Department of Housing and Urban Development, the United States Secret Service, IRS – Criminal Investigation, U.S. Immigration and Customs Enforcement, the United States Postal Inspection Service, and the Ventura County District Attorney’s Office.

Suspected fraud can be reported to the Financial Fraud Enforcement Task Forces at www.stopfraud.gov. The Los Angeles Field Office of the FBI also takes reports of suspected fraud at (310) 477-6565.

Extending the deadline for closing from June 30 to Sept. 30 would allow lenders more time to clear a backlog of 180,000 homebuyers nationwide, said amendment sponsor Sen. Harry Reid, D-Nev.

The amendment to HR 4213, the “American Jobs and Closing Tax Loopholes Act of 2010″ — which primarily extends unemployment insurance benefits — was approved in a 60-37 vote Wednesday. The vote was mostly along party lines, with only four Republicans in favor and one Democrat opposed.

The National Association of Realtors supports the amendment, saying Realtors have reported that as many as one-third of qualified applicants have been told by lenders that their loans will not close before June 30 because of the sheer volume of loan applications in the pipeline.

The amendment does not extend the deadline for homebuyers to qualify for the tax credit, NAR said in urging lawmakers to approve it, but simply extends the deadline for closing transactions already in contract.

“Since these applications were already in the pipeline and figured into the program’s cost, the extension of the closing deadline should not incur any further government costs,” NAR President Vicki Cox Golder said in a statement.

Big news to report from our board of directors’ meeting in Sacramento: On Saturday, June 12, the C.A.R. board of directors voted to approve a new structure for the statewide MLS that will merge the efforts of calREDD® with the Multi-Regional Multiple Listing Service Inc. (MRMLS).

This joint effort supports and is in line with the principles that have guided our efforts throughout the process of building a statewide MLS. The new structure will create one dynamic MLS provider serving more than 33,000 real estate professionals and 22 REALTOR® associations statewide.

It’s a huge stride forward for our members — combining our respective strengths and resources will significantly accelerate our shared vision and position the new entity to deliver even more expanded and efficient MLS services to you. You’ll have expanded access to MLS information, greater exposure for your listings, and eventually will be able to select either the calREDD® software system or the Tarasoft Matrix platform currently in use by MRMLS. You should expect to see even more choices and increased services over time.

Your Association will remain both a member and a fundamental part of the new entity, and will continue to have the right to approve actions such as merger, dissolution or sale of assets, changes in the purpose of the new entity, and changes in the board composition.

calREDD® and MRMLS will work closely during the transition to the new entity to ensure there are no disruptions in service, the needs of members continue to be met, and associations scheduled to join calREDD® are seamlessly added to the system. The Amador Association of REALTORS® is on schedule for a June 21 launch, followed by the Tehama Association of REALTORS® on June 28.

I’d like to thank our board, and the members of the calREDD® board of directors and its chairman, Mike Silvas, for their hard work and dedication to ensure that our members’ interests were front and center throughout the process. We’ll provide more information as our joint effort progresses.

Also at the Sacramento business meetings, your board of directors adopted a special purpose political assessment of $49 per member for 2011. This special assessment is for the California Real Estate Political Action Committee or, if the C.A.R. member chooses, to direct the funds to the C.A.R. general fund for non-candidate political purposes.

I can’t stress enough how valuable political involvement is. Whether it’s the legislature looking to tap REALTORS®, the transaction, or our industry for additional sources of funding, or placing restrictions on private property rights or on our right to conduct business, we must be continually vigilant in Sacramento to ensure that our interests are fairly represented. This is even truer in today’s fiscal environment, with politicians searching for every available means to cut the state’s ballooning deficits and produce a balanced budget.

Over the past few years, our coffers have dwindled, and while we still have a strong presence and a team of dedicated individuals working on our behalf at the capital, so has our influence. That’s why I contribute to C.A.R.’s political action funds, why I believe each member of the Association should support our efforts in this area, and why I wholeheartedly support your board of directors in their decision.

The special assessment takes effect for the 2011 dues bill cycle. Details on process and implementation now are being worked out; we’ll let you know additional information as it becomes available. I know I can count on you for your support.

Looking ahead, if you haven’t registered for CALIFORNIA REALTOR® EXPO 2010, taking place Oct. 5-7 at the Anaheim Convention Center, early-bird pricing has been extended through June 25, so take a few minutes to sign up today to take advantage of the savings. This year’s EXPO will feature exhibit booths, cutting-edge seminars, and other special events, while Tech Tuesday on Oct. 5 will offer a full day of technology training preceding CALIFORNIA REALTOR® EXPO. You can register online by visiting http://expo.car.org or calling toll-free (800) 242-2732.

C.A.R. also has negotiated a 25-percent discount off the registration fee for members to Inman Connect in San Francisco July 13-15; use promo code “CAR.” http://www.inman.com/conferences/real-estate-connect-san-francisco-2010/register. While you’re at Connect, don’t miss the Association’s four agent-focused sessions during Agent Reboot on July 12.  C.A.R.’s Agent Reboot sessions assist agents with “rebooting” their business and are scheduled from 1 p.m. to 5 p.m. For a full list of program sessions, please visit http://www.agentreboot.com/.

Sincerely,

Steve Goddard

2010 President

CALIFORNIA ASSOCIATION OF REALTORS®

Effective in 2011 the $49 basic cost of staying alive will now be shared by ALL Realtors in the state of California. If you are philosophically or religiously opposed to making political contributions, your investment will be channeled into a general CAR fund used for issues campaigns rather than direct candidate or party expenditures but if you’re a Realtor in California there’s no more free ride while others carry your political water. Welcome to the club!

Posted: 02 Jun 2010 01:02 PM PDT

Ever have a bad dream that just doesn’t stop? It just keeps repeating itself. You don’t want to close your eyes cuz you know what’s coming!!!  For REALTORS^®, that recurring bad dream is Congress letting the National Flood Insurance Program expire. What the heck were they thinking?

REALTORS^® have been urging Congress to pass a comprehensive National Flood Insurance Program (NFIP) reform bill all year long. We conducted a Call for Action in April. I had the privilege to testify at Congressional hearings about the importance of the program to the real estate market and the general economy. Recently, we urged action during our midyear hill visits with this issue being one of our top talking points. Yet once again, Congress left town on the holiday weekend without reauthorizing the NFIP and the Section 502 Rural Housing Program. As a result, thousands of transactions have come to a stop, again. What the heck were they thinking?

How do we rid ourselves of this bad dream?

Let me give it a shot – we let Congress know, again, and again, and again if necessary….. Anything that holds up the sale of a home, for whatever the reason, hurts our communities, stifles our economic healing, and halts real estate’s fragile recovery. Regardless of your location, rebuilding our markets in every corner of America is in every REALTORS^®’ interest, but more importantly every taxpayers’ interest, every homeowners’ interest, every renters’ interest, every property investors’ interest, everyones’ interest. What the heck were they thinking?

You may ask yourself – there are no floodplains in my market, so why should I care? That’s a fair question. Let me give that a shot too – Lenders from every corner of our nation hold up capital when the market is uncertain. When the NFIP isn’t in place it gives lenders a reason to pause.  It makes them more concerned about this short term band aid approach that it destabilizes the financial mortgage markets even more. See, every mortgage has some phrase or clause that requires the borrower to keep the asset (home) insured. If there is no insurance, the lender has the right to foreclose on existing loans, or not make the loan at all, for new ones. Now, you and I know today, or anytime for that matter, the lender doesn’t want your property back. With this uncertainty that you will be unable to insure your home, the lenders are even more reluctant to lend. This hurts home sales everywhere. It hurts all of us! What the heck were they thinking?

To make matters worse, Congress has also abandoned the Section 502 Rural Housing Program.  The housing program provides zero-down payment mortgages to eligible families in rural area of every state. Many of these families signed contracts before April 30 and plan to utilize the homebuyer tax credit. If this program is not restored soon, they will lose their opportunity for home ownership. What the heck were they thinking!

I’m a lot ticked, can you tell? Yesterday, NAR sent you a Call for Action urging Congress to extend the NFIP and Rural Housing Program immediately. Please, now is the time for the REALTOR^® Party to speak with one voice, to urge Congress to renew both NFIP and the Rural Housing 502 program and do it now!.Give our lobby in DC the strength of numbers they need. What the heck were they thinking?

Tell everyone you know, post this, tweet it, Facebook it, or write your own version! Get folks mobilized, you can do it! Go to REALTORACTIONCENTER.com “Call for Action: Congress Abandons Critical Housing Programs – Again” spend a few seconds and do a couple clicks and let Congress know how important this is for our citizens!

Direct your clients to these sources for more information: FEMA, FHA, Fannie Mae, Freddie Mac and the VA. Remember REALTORS^® are the Heart of the Market! — Moe Veissi, 2010 NAR First Vice President.