SRCAR Encourages your Support of AB 1098.

On Friday, August 30, the legislature passed AB 1098, a bill that would reinstate VLF funds to the four newest cities in California, including Menifee and Wildomar. We encourage you to download the attached letter of support and email it to the following people. The Governor could make a decision on this measure at any time so time is of the essence.

Thanks to Senators Anderson and Emmerson and to Assemblymen Jeffries and Nestande for their affirmative votes to move this bill forward. 

SUPPORT letter for AB 1098 

nancy.mcfadden@gov.ca.gov,

gareth.elliott@gov.ca.gov,

anna.pozdyn@gov.ca.gov ,

gavin.newsom@ltgov.ca.gov

http://gov.ca.gov/m_contact.php

B of A announces change to 2nd mortgage deficiency waiver guidelines

Changes to 2nd Lien Deficiency Waiver Guidelines

Bank of America has extended additional support to homeowners by agreeing to enhanced 2nd lien deficiency waiver guidelines.

 

Basic qualifications:

  • The short sale must be initiated on or after June 1, 2012.
  • The 2nd lien must be attached to a 1st lien mortgage owned by Bank of America.

If you determine that the homeowner qualifies for this waiver, contact your short sale specialist to establish the amount to request for the 2nd lien.

 

This waiver enhancement, based on the Department of Justice settlement, went into effect on June 1.

 

Important reminders:

  • Use Equator messaging as your primary way to communicate with your short sale specialist.
  • Contact Short Sale Customer Care at 1.866.880.1232 for status updates and answers to immediate questions.

SCAM – Has your Direct Deposit been Disabled?

I’ve been ignoring this SPAM message for the past couple weeks again since it first made the rounds this spring.

Until now.

The past couple days I’ve had calls from several friends asking if this is a scam – and friends, I hate to say it but IT IS!

If you get something in your email that looks like this…

nacha

or this…

ach

Don’t click on anything but your delete button – otherwise you could end up with some seriously nasty times for you and your computer. Don’t take my word for it – you can check the NACHA website yourself – their front page carries a caution about the fraudulent emails along with a website to send a copy if you got one. That’s abuse@nacha.org. Or you can check Snopes for more info at: http://www.snopes.com/fraud/phishing/nacha.asp. NACHA, the electronic Payments Association, does not process nor communicate directly with persons or organizations about individual ACH transactions.

Governor Brown – VETO SB469

On Friday morning, September 30, 2011, several representatives from our community held a press conference asking Governor Jerry Brown to VETO SB 469 (Vargas). This bill is another in the long line of attacks by California on both businesses and municipalities in our state. It is just one example of why California finds itself 49th out of 50 states for having a business friendly environment. It’s why we’re losing 5.4 companies every week to places like Texas and Colorado and North Carolina and Nevada. It’s another example of that political-think that says Sacramento can make better decisions for our local cities than they can themselves – keeping in mind that Sacramento is deeply in debt, can’t pass a budget, is divisively gridlocked and stocked with career politicians who have never held a real job. Yet they feel perfectly content to try to dictate to the rest of us how we should comport ourselves.

This morning I joined the Mayor of Murrieta, Randon Lane, Wildomar Mayor Pro-Tem Ben Benoit, Menifee City Council member Darcy Kuenzi, Lake Elsinore Finance Director Allan Baldwin and League of Cities rep Dave Willmon in providing our statements to the assembled press. Here is my statement:

Good morning. My name is Gene Wunderlich and I’m Chair of the Southwest California Legislative Council, a coalition of businesses and Chambers representing more than 3,000 small, medium and large businesses in Southwest Riverside County.

Communities throughout our state are facing crisis. In Riverside County our unemployment rate is 14.7%, statewide it is 12.1%, and that’s only the people they count. Like many other cities and counties across California, we each face problems that are similar in nature, yet unique to each locality. We must be able to make decisions that are best for our communities, our families and our friends.

Our elected leaders in Sacramento don’t seem to know what’s going on in Temecula, or Wildomar, or Menifee or communities across Southwest Riverside County. SB469 is a perfect example of that with its bureaucratic roadblocks and overreaching state authority. It’s a one=size-fits-all bill and it will not help us create jobs in our community – although it may well keep several attorneys busy for years.

This bill takes away the power of a community to build and define itself and gives that power to the state, having local land use issues defined in Sacramento. The state SHOULD NOT be imposing more regulations on local governments right now. The state SHOULD NOT be telling us what kinds of businesses we can and cannot approve and the state SHOULD NOT be interfering in our ability to help reduce the high unemployment rate in our own community.

We are asking Governor Brown to help Southwest Riverside County and cities and counties across the state. Join us in helping create new jobs, not destroy more jobs.

VETO SB469.

This bill is also opposed by the California Association of Realtors® and dozens of other pro-jobs, pro-business & pro-local rights groups throughout the state.

California Legislature – Unclear on the whole ‘jobs’ thingy.

Say you’re the owner of a commercial building. Based on bids, you hire a company to come in evenings and clean the building keeping your investment intact and making it presentable for your employees and clients the next day. Now imagine that company is run very poorly, they hire cheap labor, do a very poor job, don’t even show up some days, maybe steal stuff from your workplace. At the end of the year, they’ve done such a bad job you go back out to bid and hire a reputable company that has a great reputation but will cost significantly more. 

Well, good riddance to bad company, right? You’re paying more but at least you’ve got quality service and no more problems right?  

Not in California. When our esteemed legislators reconvene mid-August after their mid-autumn respite from profligately squandering our money, one of the bills they will consider is AB350 (Solorio). The bill is called the ‘Displaced Property Service Employees Opportunity Act’ and here’s what it does. Whenever an owner of a building awards a contract to provide services for their building to a new contractor, the new contractor MUST HIRE the previous contractors employees to do the work. And you’d have to keep them in place for at least 90 days. 

The predecessor bill – the Janitor Opportunity Act signed into law in 2001, only applied to janitorial staff. The new and improved version would grant the rights/protections to janitors, window washers, landscape workers, security, cafeteria and dietary services as well. You as the building’s owner, the person who hires the service personnel to support your investment, have NO VOICE whatsoever in the process. You can hire a new company but still get the same lackluster service you tried to replace – at least for 90 days. 

Because the bill creates no new jobs and only applies an additional layer of regulation to an already overburdened jobs market in the state, the Southwest California Legislative Council signaled our opposition to the measure in April. This bill should have died in committee, or at the very least should never have passed the Assembly and should not be passed by the Senate. Unfortunately our Democratic majority Assembly passed the bill and the Senate will take the matter up in a couple weeks, with probably the same result. Jerry Brown should veto the bill but again…

Oh well, that’s what happens when you have a majority of our legislature who has never held an honest job. Their ranks are bloated with lifetime ‘public servants’ and sycophants who have always fed at the public trough, never met a payroll, never had to hire or fire employees, never tasted the glory of entrepreneurship nor dealt with it’s dark side. 

Keep it up, folks. The next regulation you pass should be one making it illegal for California companies to move out of state. With all the other crap you are heaping on them, that’s the only way you’ll prevent the dozens who are departing every week from heading to Texas or South Carolina or Nevada or anyplace but California.  

Realtors® Federal Credit Union announces new holiday loan program

To: All REALTORS®

From: NATIONAL ASSOCIATION of REALTORS® and REALTORS® Federal Credit Union

Date: November 30, 2010

Re: Introducing the Horizon Loan – Just in time for the holidays.

With the holidays quickly approaching it’s hard not to feel some of the financial pressures that come along with this time of year. Whether it’s holiday expenses or a warm vacation, REALTORS® Federal Credit Union is here to help.

What’s on your horizon?
Introducing the Horizon Loan, where the possibilities are endless.    Apply for and use this loan for anything that is on your horizon.  It’s the perfect way for you to get the money you need at a low rate of only 10.9%* APR**!   You can apply online today in just minutes.

  • Visit REALTORSFCU.ORG and login to Online Banking
  • Click the “Accounts” tab
  • Click the “Consumer Loan Application” link to get started

Horizon Loan Image

Not a Credit Union member? Not a problem!
All REALTORS® and their immediate family members are eligible for lifetime membership. It’s easy and secure to join online and takes less than 15 minutes. Join now!

Have Questions?
Call a Member Care representative 24-hours a day at 866.295.6038. We’re here for you!

Mid-year housing Update for Southwest California

So much good news – sales are up significantly comparing 1st half to 1st half over the past 4 years. Some cities are double or triple their volume during 2007. Granted ’07 was not a stellar year but these numbers are well up over any of our previous best.

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.

New F&F guidelines ordered for energy retrofits.

I have mentioned the solar and other energy retrofit programs our local cities are getting ready to roll out. One of the problems was the fact that Fannie & Freddie will not underwrite future loans on these properties since the improvement goes on the tax bill and that is a senior loan to the mortgage. FHFA has issued a statement concerning that and encouraging F&F to develop new guidelines to deal with this. After all, the PACE program is also a Federal program – you’d think one federal program would not be in conflict with another, wouldn’t you? (heh-heh).

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

EVERY Realtor becomes an advocacy investor.

I’ve been at our mid-year CAR meetings in Sacramento this week so will have lots to post in the coming days. But I did want to share some phenomenal news with you that at this afternoons Board of Directors session we passed the motion which will have EVERY Realtor becoming an investor in our advocacy effort. The past few years that burden has increasingly been borne by about 20% of us while CAR’s lobbying stature has fallen from top 5 in the state to #33. This at a time when there are almost daily efforts to expand taxes on Realtors and homeowners, reduce mortgage interest deductions, encroach on the private property rights of our clients and worse.

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!

What Memorial Day is all About.

Honoring Those Who Serve Our Nation, Posted by Moe

Posted: 26 May 2010 06:34 AM PDT

This upcoming Memorial Day weekend our nation again commemorates those men and women who serve or have served our nation during combat. I was privileged to start my salute early on.

Last Thursday, I had the rare opportunity to testify on behalf of our 1.1 million members in support of the Veterans Home Loan Guarantee Program.

Like you, I am a strong believer in the value of homeownership, but let me just say this particular program has special meaning for me. As the father of a soldier currently serving in Iraq, I am so very proud that the VA is there to make good on the promises our nation made to our enlisted women and men when they joined the military through this entitlement.

The VA Home Loan Guarantee Program, created under the GI bill, encourages private lenders to offer very favorable home loan terms to qualified veterans.

Today, the VA has guaranteed nearly 19 million loans to American veterans, with a total loan volume of just over one trillion dollars. Because of programs such as the VA Home Loan Guarantee Program, the homeownership rate for veterans is significantly higher than the national average – as high as 80 percent.

I had the good fortune to meet with Chairwoman Stephanie Herseth Sandlin (D-S.D.) as well as the top Republican on the subcommittee Congressman John Boozman (R-Ark.). They both thanked me for the work you do! The work all REALTORS® do on behalf of veterans.

And I thanked them for their help to veterans who may have been victim to the subprime loan crisis. Listen to this, the Veterans’ Benefits Improvement Act of 2008 made changes to VA’s home loan refinancing program. Because of this Act, many veterans have been able to refinance toxic loans into safe, affordable VA loans if their non-VA loan is in distress.

I also spoke about NAR’s toolkit that promotes the VA Home Loan Guarantee Program. One if not the only informational piece of this very important topic. Last fall, the National Association of REALTORS partnered with the Veterans Affairs Department to produce “Unlocking the Future”, a VA Toolkit for REALTORS and homeowners. This comprehensive informational DVD and brochure complete with videos and Frequently Asked Questions, provides REALTORS® with all the information they need to successfully guide a veteran through the home loan process.  Yea, it’s a great informational piece for the vet as well. If you don’t have this valuable tool, please go online to realtor.org.

I was heartened after my testimony to talk with a representative of the American Legion, and other veteran organizations. After hearing about our toolkit, the Legion said they want to promote our VA Toolkit by writing an article in their publications with more than 2.5 million circulation. It is times like these when you plainly see how REALTORS® make a positive difference in our communities, in people’s lives, and especially for those who serve our country in combat.

For me, I can’t think of a better way to kick-off the Memorial Day weekend than to take pride in REALTORS® support of a program that is proven to be a huge benefit to those who have so bravely served our country.

Oh by the way! When there is such a hue and cry about the concerns in government programs, this one, supported by so many REALTORS® nationwide, has proven beyond a doubt that it works and works well. The foreclosure rate in VA loans is a strikingly low 2.46 percent compared to subprime 15.5 percent and even prime loans that are a full ¾ of a percent higher than VA loan foreclosure rate.  REALTORS® ARE TRULY THE “HEART OF THE MARKET”

PS  Remember, men and women in the military have an additional year to take advantage of the first time home buyers credit!!– Moe Veissi, 2010 NAR First Vice President

Riverside County Foster Parents of the Year

foster

This past Saturday evening I attended the 2010 Foster Parents Appreciation Dinner hosted by the Riverside County Department of Social Services. It was a honey-do kind of thing because my wife works for DPSS and her department is largely charged with the logistics of the event so even though no alcohol is served, I get to attend. I’ve done it before – it’s not too painful.

Held at the always lovely Monteleone Meadows, the event packed the house attended by, and in tribute to, the dozens of families throughout the county who act as foster parents for needy children. After brief introductory remarks, the crowd enjoyed Hennie & Mike Monteleone’s signature tri-tip and cheesy potatoes before the evenings keynote speaker was introduced.

If you’ve never heard of Antwone Fisher, you should check him out. Antwone started life with seemingly the whole deck stacked against him. A Black kid, born in prison, raised in an orphanage when not in an abusive foster care home until he turned 17 and was unceremoniously dumped out to fend for himself, Fisher could easily have become just another statistic. After spotting a poster inviting him to ‘see the world’ at the Navy’s expense, and having nothing on his schedule at the time, Fisher joined up and spent the next 11 years traveling the world and learning about himself and how to deal with people in a life setting unlike any he had seen before.

Deciding life in the warm coastal climes better suited him than his native Ohio, he landed a job in security at Sony Pictures after the Navy where his daily schedule brought him in contact with many notables. These folks eventually convinced him his life story would make an excellent movie – for which he provided the screenplay. And the rest, as they say, is history. The story of his life, starring Denzell Washington, also marked Washington’s directorial debut. Since then Fisher has written numerous screenplays becoming the first African American to earn over $1 million for a single screenplay.

Fishers encouraged the foster parents telling them ‘you never know when you’ve got a diamond in the rough’. He also encouraged foster parents to be patient and to always be mindful of the impact they have on young lives that may already be in turmoil. ‘Sometimes you won’t know or see the results of your love for many years – just know it’ll be there. If you can have a positive impact on even one life you will have done a good job.’

Following his remarks the three nominees for ‘Foster Parents of the Year’ were introduced.

Donna & Jon Wray of Murrieta have fostered over 700 children during the past 17 years. Donna is also active in promoting resources to help kids transition from foster homes to life on their own as well as providing resources to allow them to transition back to their own families more easily as circumstances permit. “Have patience and treat them like your own. Expect out of them what you would your own,” was the advice shared by the Wrays in their video introduction.

Christina & Juan Arroyo of Hemet have only fostered 5 children but what sets them apart is that all five have been medically challenged kids – among the most difficult to work with. Of these they have adopted 2 and are in the process of adopting 2 more. “There are a lot of children out there and they need someone to love them. Love them equally because they are no different.”

Awarded Foster Parents of the Year, Sheila & Paul Bywater of Lake Elsinore have fostered over 1,000 children during the past 30 years. Radiating goodwill, Sheila & Paul have recently specialized in new-borns & infants, another demanding challenge. “You have to do this whole heartedly, children will know when its not from the heart. You have to love them as your own and never treat them differently.”

In the video introductions, it was easy to see the love and caring that permeated these very special homes. No doubt the homes of all those in attendance are much the same and the children who have the misfortune/good fortune to be assigned to one of these homes will be well cared for indeed. Misfortune because of events in their young lives that are disruptive and damaging, good fortune because in these homes they will experience the love and caring that might, for many, be the first time in their lives. These are Angels among us who, for the most part, remain anonymous and receive no special accolades or recognition for the very special work they do.

There is a great need for loving, caring families to open their homes and hearts to these young people. If you have any questions or feel that special calling, for indeed it is a special person who can give this much of themselves, then contact the Riverside County DPSS for more info.

At the NAR – Economic Update w/ Dr’s Yun & Zandi

This morning we heard from Dr Lawrence Yun (NAR Chief Economist) and Dr. Mark Zandi (Moody’s Economy.com) with their financial outlook for the rest of 2010 and beyond. I try never to miss this program as I always find the info interesting – if not always the most accurate.

Now I know there are some of you who are not enamored of Dr. Yun’s talks and consider him to be an NAR stooge – but the fact is he has recently been named by USA Today as one of the nations top 10 economic advisors and Dr. Zandi is one spot higher in that ranking than Yun – so say what you will, these guys have some credentials. I personally am glad to hear an econmist who understands real estate giving a Realtor perspective. Too many of them talk about housing but strictly from a philosophical point of view – they’re not surrounded by Realtors every day like Yun is.

An overview;

dr lawrence yunYun talked quite a bit about the first time homebuyer program and the success that it was. Ultimately 3.4 million buyers will benefit from that credit and just over 1 million of those would not have purchased at this time without the incentive. Given the multiplier effect of real estate purchases this program more than paid for itself in terms of economic benefit to the nation. It also had a significant impact on reducing inventory which in turn helped stabilize prices. Without that inventory drop prices may well have dropped another 8% before finding a bottom and that 8% would have translated to another $1 trillion drop in equity wealth for homeowners. Price stability also translates to fewer foreclosures going forward as the 3rd wave of foreclosures was largely driven by unemployment and negative equity. 

Dr. Yun does not believe there will be a double dip in housing prices but that distressed properties will continue to be with us for at least the next two years before we start getting anywhere close to a normal market. Several factors could impact that timing – including such international pressures as a default by Greece and other events but he doesn’t believe that will be allowed to happen. 

Yun also called out the next crisis, one that I have been talking about for awhile now.  That is a housing shortage which could lead to a quicker price recovery, if not another mini-spike. This is driven by the fact that demand is now keeping pace with supply in many markets yet new home builders are not working yet – which could lead to a shortage within two years and force upward price pressure in some areas – specifically ours herein Southern California. Florida is still toast, Arizona & Nevada are still hurting but many areas are climbing back out with some, like the San Diego market, showing double digit price appreciation. 

dr Mark ZandiDr. Zandi titled his address “The Housing Crisis is Over (Almost). He believes we will continue to see minor price slippage in some areas into 2012 until the job market picks up. While as many as 250,000 new jobs have been crated in the past 2 months, we have lost nearly 9 million. He believes we will average 150,000 – 250,000 new jobs per month this year and as many as 300,000 a month by next year. By next year at this time we should see job growth in every sector of the economy except state and local government. But even under is rosiest lens, he doesn’t see us approaching full employment (5.5%) until well into 2014. 

While some areas, like SoCal, have housing inventories of 2 months or less, much of the country is still struggling with 2 years of homes – although he agrees with Yun that that inventory will be disposed of and if an adequate supply of new homes doesn’t begin to appear soon it could precipitate another shortage. He also outlined the four stages of the housing crisis starting with flippers giving homes back to builders in 2006 – that was just a preview of things to come. Stage 2 was the infamous sub-prime melt-down that consumed us in 2007 and the freeze on jumbo loans which is still hurting the recovery of the upper end of the market. Stage 3 occurred in 2008-2009 driven by rising unemployment and falling home equity. We are currently tailing off that state and driving into Stage 4 which is marked by strategic defaults. There are 50 million home mortgages in this country of which nearly 1/3 or 15 million are under-water right now with negative equity. Of those, 4.5 million are either in foreclosure or are 90 days or more late on payments. That translates to more pain to come but it will be somewhat mitigated by an improving employment picture, continued low interest rates (no re-sets) and stabilizing or appreciating equity. 

Overall not a bad prognosis from these two. Not entirely rosy but I’ve certainly heard worse. 

Here’s the slides to Dr. Yun’s presentation:

Struggling Homeowners Led To Slaughter by False Hopes

I’m re-posting a recent blog by HELP Founder Chris Sorensen. I believe Chris makes some excellent points here and brings up some issues we should all be cognizant of. Far too many homeowners are slowly draining their life savings trying to keep their heads above water for the glimmer of hope that, statistically, will be snuffed out at some further point down the road. I’d be interested in your thoughts.

Struggling Homeowners Are Being Led To Slaughter By Far Too Much False Hope

Re: The Growing Housing Crisis

I just got off the phone with a homeowner who claimed that she and a few of her neighbors are all debating on what to do with their homes.  She explained to me that due to some financial setbacks, they are having to take money from their retirement account to keep paying their mortgage.  She went on to tell me that the bank was assuring her that a trial modification was forthcoming and her and her friends had just read that home sales were up 27%!  Based on this recent news, she asked if I felt she should continue to spend their retirement money on their home that they cannot currently afford.  ARE YOU KIDDING ME?!

Look, I am not claiming to have all the answers here, but as a consumer advocate, non-profit, my only agenda is to speak the truth based on empirical evidence and let people decide for themselves.  I do not and will not agree that it is okay to dumb down America and keep feeding them false hope that a “turn around” is just around the corner.  It’s not.  At least not with respect to housing.  We have significant pain left to deal with.

Cities and County’s Have Been Hurt Badly

Fitch and Moody’s and others gave AAA ratings to financial instruments that they knew, or should have known, were not AAA worthy.  By doing this, pension funds and other legally restricted funds were able to invest in them for a higher rate of return.  When it became known that they were improperly rated, these legally restricted funds had to leave the investment, even if it was at a loss.  This was the beginning of the meltdown.  What few understand is that now, at least in California, many municipalities have to make up the short fall in the public retirement funds that lost money in these investments, since the employee unions contracts say they are guaranteed to always make money and never loose, or be at risk of market corrections like the rest of the private sector.  Thereby causing an even greater economic crisis for the County or City impacted.

The municipalities are dealing with massive deficits, layoffs and furloughs which only compounds and exacerbates the problem, as more and more of their constituents are finding it difficult to make their mortgage payment.

The Underlying Challenge

Currently, according to the latest HAMP (US Treasury) numbers, Data Quick numbers, Foreclosure Radar numbers and First American Core Logic numbers, there are 6.5 million homeowners who are 60 days or more behind on their mortgage.  This number is projected to increase to 13 to 14 million over the next three to four years, according to the Center For Responsible Lending, as well as Goldman Sachs themselves.  Since they are apparently the only smart people around that predicted this crisis, we should listen to them.

The Presidents own numbers (See Herbert Allisons testimony before Congress in December) report that at best, they expect to assist between 3 and 4 million responsible homeowners through 2012.  Does anyone besides me see the problem here?  This leaves 10 million of you who are not scheduled at this point to receive help.

But Wait, It Gets Worse

Those that receive the modification do not usually understand that the HAMP program and other programs often have increases in payments beginning on the third to fifth year, that most will not be able to afford.  Nor do they understand that their incomes are not going to be able to handle this increase and that potentially, all they are truly doing is helping the bank manage when they will get the home back, not if they will get it back.  They have not a clue that behind the scenes are negotiations that will impact their mortgage and who they will be dealing with in the future.  In fact, many loans are being packaged and sold in large “pools” to allow someone else besides your current lender to kick you out if you fail to get help, or you are part of the 50% of the folks that fail to keep their modified terms within the first 12 MONTHS (See Mr. Dugans testimony before Congress in March 2010.  He is the Director of the Office of the Comptroller).

I’m not crying Chicken Little.  I do not believe the sky is falling, but if the Mortgage Bankers Association short sold their building in February of 2010 (Read story from OC Register here:
http://mortgage.freedomblogging.com/2010/02/09/mortgage-bankers-hq/26095/) at a loss of 58 million and Goldman Sachs is alleged to have packaged instruments based on our current loans with the prediction they were going to fail, why in the world do you, the individual homeowner, believe things are getting better?!  Are you crazy?  No, you’re not.  You just want to believe that people would not take advantage of other people in this way.  Especially with respect to someones home.   Sadly, it is becoming more and more evident, that either through manipulation, or sheer ignorance, your trust has been misplaced.

Many of you are in fact, victims of circumstances beyond your ability and control

This was done to you in many cases, not by you.  I’m not talking about the homeowner who went out and bought a Hummer with matching Wave Runners at minimum wage.  I’m talking about you, the one who did mostly everything right and are now wondering how you will live out your retirement years.  You want to do the right thing and it pains you to not keep your promise to pay.  I know who you are.  You come to my classes and you cry on my shoulder and I am angry for you, very angry.

Get out!  Get out now!  From 1940 to 2000 (In CA it averaged 7.1% for this 60 year time frame) appreciation was based on many factors, including underwriting criteria that demonstrated one’s ability and willingness to repay debt.  From 2000 to 2006, it didn’t matter.  Fog a mirror, get a loan.  Because of this, we had too many buyers which caused unrealistic appreciation.  What my point?  You’re looking at 10 years minimum before your home comes close to being worth what it was at peak.  Most un-biased experts believe it is likely longer than that.  Here is a fact; your credit damage from a short sale will cure far faster than your equity position will.  You can buy in the future in just two to four years, I assure you (See Fannie Mae’s April announcements and refer to HUD’s 4155).  You may not want to, but you could.  All you are doing currently is postponing the inevitable and worse, you are being manipulated by being offered false hope by well meaning folks who are dependent on their job or their funding to tell you a story that in most cases, does not have a happy ending for you.

A trial modification will report you as late on your mortgage each and every month you make that trial payment on time.

Did you know that?  Then, five to twelve months later, 80% plus of the time, you get denied for the permanent modification.  Since the lender has already met the statutory requirements for notification for a foreclosure action in CA, when they are in fact done taking payments from you and are ready to sell your home, they can deny the modification and then you will find out you don’t own your home anymore once you get a knock on the door from a Realtor exclaiming they are here to offer you; “cash for keys as long as you get out and don’t hurt the home on the way out.”   Please, let me teach you how to leave under your terms, not theirs.

Don’t try go this alone

This is a complicated mess.  You have recourse vs. non-recourse issues, anti deficiency issues, cancellation of debt, re-conveyance issues, obtaining a full satisfaction issue, future collection issues, future audit issues, impugned income issues and the list goes on.  The American homeowner who is in trouble has a major problem and without proper guidance is in big trouble.  Not just today, but in the future.   If the problem is allowed to be managed the way that it currently is, they will lose their collective voice.  Help me help all of us by getting the word out.  People need details that they cannot easily find, from someone who has nothing to gain.  All the HELP program wants to do is educate and then steer those who have been educated towards the professionals who brought the public to us to be educated in the first place.  It’s a win-win for all.

The President calls April, Financial Literacy month.  Let’s take him at his word that he will allow the truth, the whole truth to be told to homeowners from an expert with no agenda.   www.freehomeownershiphelp.org.  Please suppport consumer protection through education and become HELP Certified so we can reach more people in need.  And, if you are a homeowner, or homebuyer, use HELP Certified Professionals who support our cause.  They are willing to be held accountable and they fund our ability to offer free un-biased education to the public.

Chris Sorensen, Founder-USA HELP, Inc.

http://www.trulia.com/blog/chris_sorensen/2010/04/struggling_homeowners_are_being_led_to_slaughter_by_far_too_much_false_hope

Inmate Releases Making Our Communities Safer

The headline in today’s Californian sums it up pretty accurately – ‘Violent Parolees not being watched‘. Of course you’ve been keeping up with this prisoner release debacle that has saddled our state after the passage of AB 3X 14 last year. As many as 40,000 inmates will be released into our streets and cities and the exodus has begun.

You may recall we were assured by the lying hypocrites that voted for it (21 Democrats. all 15 Republicans and 4 Democrats voted NO) that NO ‘violent criminals’ would be released. At the time the bill was passed I published a partial list of crimes which would either qualify for immediate release, or which were being ‘written down’ in severity to facilitate immediate release.

These include: Gross vehicle manslaughter while intoxicated, Kidnapping, Kidnapping in the commission of car jacking, Assault with the intent to commit rape or other sex crimes, Human trafficking, Sexual battery, Assault with deadly weapons, Rape in concert, Pimping a minor, Aggravated sex crimes on a child, Felony child abuse, Child abuse resulting in death, Female genital mutilation child abuse, Domestic violence, Forcible sodomy, Lewd and lascivious acts on a child, Child pornography, Elder abuse, Burglary, Identity theft, Attempted murder, Crimes against children under 14 and the developmentally disabled, Rape by people who know they have AIDS, Infliction of injury on a pregnant woman (with the intent to do so), & aggravated arson. (list courtesy of Assemblyman Kevin Jeffries, Mushroom Alert, 8/20/2009)

Well that includes a pretty sweet cross-section of our populace, don’t you think?

But here’s something you may not be aware of. The vast majority of people being released are NOT ON PAROLE. That’s right. Pimps, child abusers, rapists, sodomizers, kidnappers and the like are being turned onto the streets – at a time of record high unemployment – with no record being kept as to where they’re released, where they migrate to and nobody keeping track of them!

That’s because according to Gov. Arnie & state correctional officials, dumping this many new parolees into the system would totally overwhelm an already shaky system so the argument went that releasing these convicts without paroled supervision would actually ‘improve public safety by concentrating parole supervision on only the most dangerous felons’. There was a further ‘benefit’ in that if they weren’t on supervised parole there would be fewer of them sent back to prison for parole violations as they could only be sent back to prison for ‘new crimes’. I swear to God I’m not making this up.

The releases started on January 25th, 2010. In less than 24 hours one releasee had already been re-arrested for rape, the crime he was originally imprisoned for. Of the 1,944 convicts released through the end of February, 96 had been in jail on weapons or explosives charges, 120 had been in for stalking, domestic violence and/or child neglect or cruelty, and several had been in for a variety of sex crimes, battery and involuntary manslaughter, arson, soliciting murder and false imprisonment. We can only thank our lucky starts they’ve still got all those 1 joint pot smokers locked up tight.

Well folks, the fun has just started. If you question my veracity, talk to any local police chief. I got a lot of my info from Murrieta Chief Mark Wright. The PD is absolutely thrilled at the prospect of thousands of the ‘non-violent’ convicts descending on our communities at a time when even honest, hard-working people are having trouble finding work. They are released with no notice to the community and no monitoring or supervision whatsoever. Is it any wonder applications to carry firearms has skyrocketed in the past 6 months? It’s gonna be a long, hot summer. Realtors beware – be aware walking neighborhoods, doing open houses. Don’t become a statistic.

Local Legislators Hold Summit on Jobs & Regulations Pt 3

Continued from Part 2.

Well, the litany of grievances was constrained to 3 hours but most panelists indicated they could go on for days about the negative shift in California’s business climate over the past decade.

Solutions? Not many. While several referred to the growing anger and activism of business owners, the prevailing majority legislative climate precludes any real progress unless or until people get really fed up. They recommended a cessation of new regulations, at least until we’ve figured out what the current regulations say. They cautioned our Legislators that California doesn’t necessarily have to take the lead in everything – especially in job-killer legislation and extreme and excessive environmental regulation. They pleaded for no new taxes – against either businesses or individuals. In fact there was some agreement on eliminating personal income taxes and reducing sales tax applied across a broader base including services as a way to stabilize state revenue while reducing the overall tax burden.

Using Texas as a model, they cited the lack of personal income tax and a part-time legislature which has led to a stable housing market and an expanding business climate. Some businesses relocating to Texas have claimed up to 50% reductions in business costs, regulatory burden, more affordable employee housing and a more cooperative and friendly state structure. It’s all about the ROI and California just doesn’t offer that incentive anymore. We have the talent and the innovators. 3 of every 5 patents issued in this country still originate in California. We are still the drivers of the nation’s economy and business – but we are fast losing that edge and doing nothing about it, or maybe even exacerbating it.

Finally, at the risk of creating yet another state level bureaucracy, Vranich suggested a Business Protection Agency. To be run by business people who have actually run businesses and met payrolls and understand the impacts and unintended consequences of the legislation and regulation that routinely plops in steaming mounds from the bowels of Sacramento. This group would have final say-so on anything that would ultimately impact businesses and would have the power to modify or reject anything that would cost more jobs than it would create.

Will anything be accomplished by this summit? Not likely. But it gave our Legislators a chance to hear directly from those most impacted by the current business climate in our state. But as they said, the people who really need to hear this message (i.e. Democratic Legislators), to understand the impact of their actions, are the ones least likely to listen or to understand what they are hearing. Until people wake up and vote with their wallets, California individuals and businesses will continue to vote with their legs and take their business elsewhere.

The Living Last Supper – Opens Tonight in Temecula.

Tonight at 7:30 the curtains will part at the Old Town Temecula Theater on the Leonardo Da Vinci masterpiece, The Last Supper. It won’t be the actual painting, mind you, but a life size portrayal of the momentous event in the life of Christ and the 12 Apostles. Not only is the portrayal life size, it is actually alive in that this is a presentation known as ‘The Living Last Supper’, a recreation of the original artwork that includes vignettes by each Apostle during the course of the evening about his travels with Jesus.

Frozen in the moment, each speaker disengages from the picture to provide his dialogue, then melds back into the fabric. Audience members can sometimes forget to listen to the stories as they concentrate instead on trying to ‘catch’ somebody moving. Believe me, holding one pose for an hour is not as easy as it sounds.

This is my second year as Peter, The Rock. This year my son, Dane, has also joined the cast as John, The Beloved. About 2/3 of the cast are returning members having performed the play for the past 3 or 4 years, while a few are new comers to the stage. In the one non-speaking role, Jesus has rejoined the cast flying in from his current home in Indiana (who knew?) to reprise a role that he closely resembles in the original artwork. We’ve got 3 Realtors (Dane, Mike O’Donnell and myself), 2 teachers, a cop, a couple students and a couple retired fellows in the cast and all deliver moving dialogue as their character is called upon to question which of their brethren will betray Christ this night.

The performance runs March 29, 30 & 31 at 7:30. Tickets are a paltry $17 for adults, $15 for Seniors and children and if you’ve got 10 friends you can enjoy the evening for just $12. It’s like no play you’ve ever seen before and I think you will find it very entertaining. You might even pick up a few things you didn’t know about the portrayal of this momentous event. Hope to see you there.

last supper

HVCC Questions? New & Improved Answers

Freddie Mac, Fannie Mae Update HVCC FAQs

The government sponsored enterprises (GSE), Fannie Mae and Freddie Mac, recently updated their Home Valuation Code of Conduct (HVCC) frequently asked questions (FAQ). Both GSEs state that while there may be some differences with two sets of FAQs in terms of style or structure, they present no substantive differences in interpretation or implementation of HVCC. Nor do they impose any different operational requirements. The FAQs include new questions and are also organized by subject area.

NAR has called on both GSEs to coordinate their FAQs and codify them into existing appraisal policy. In 2009, then NAR President Charles McMillan attended a series of appraisal summits sponsored by the National Association of Home Builders where he asked both GSEs to work together to ensure the FAQs are coordinated and do not result in greater confusion for stakeholders in the real estate industry.

Freddie Mac HVCC FAQs
Fannie Mae HVCC FAQs

Are You Involved In Sort Sale Fraud?

I am reposting an excellent blog by Jonathan Osman out of South Caroline. Seems fraud is not exclusive to our corner of the market but it is prevalent. We will be posting soon on an investigation into another local short sale scheme involving 3rd party trusts as soon as we have compiled the info. Meanwhile – beware. If it sounds too good to be true…

Are You Involved in Short Sale Fraud? Here are the Warning Signs!

FRAUD: intentional perversion of truth in order to induce another to part with something of value or to surrender a legal right b : an act of deceiving or misrepresenting. (Merriam-Webster Dictionary)

It’s a scary word in the the real estate industry (and in any industry) and unfortunately the turn in the real estate market has sent the scam artists out in force with an army of desperate agents eager to assist them. I know this because, as an agent who lists and sells short sale properties, I get calls from these guys and their agents ALL THE TIME.

Ok, before I go any farther, let me just state for the record that I am NOT pulling any punches on these guys as WE take fraud VERY seriously. Anyone real estate licensee involved in such activity should have their license revoked and sued by the lender and seller.

So here’s the deal. The listing agent either seeks out or is sought out by a seller in a desperate and hard time. They list the home with the agent as a short sale who then offers the seller a contract on the home from an investor. The contract is WAY below market value but the seller signs anyway not knowing what the market value of the home really is. That investor then starts negotiating with the bank either on behalf of the seller or the agent to get the sale accepted. Meanwhile, the agent RE-LISTS the home for sale but at a much higher price than the previously accepted contract…while the home is technically under contract with someone else. The seller is now the investor who has not yet closed on the home.

Just to recap: The seller is under contract with an investor who then relists a home they do not own with an agent who lists the home for a higher price. BUT WAIT, THERE’S MORE!!!

A buyer comes along and places an offer in on the higher asking price and the home is under contract. If the investor is successful, he will then negotiate as low as possible his contract, realize what he’s getting on his contract and make a profit on the difference between the two. So at closing, the investor signs earlier and the investor’s buyer signs later, transferring the house twice in a very short period (i.e. flipping).

If you’re wondering…yes you read that right: a investor who didn’t own the home just made a huge profit for doing absolutely nothing but by defrauding the seller and their mortgage company.

Any agent who is participating in this action should be quickly shown the door any their firm at the first knowledge that this is occurring since they are VIOLATING their fiduciary duties to the seller. After all, they stand to make a huge pay day for the hassle and the seller typically doesn’t care because they don’t receive anything monetarily from the short sale. The bank cares since they were screwed out of thousands of dollars that should have gone to cover the loss from the short sale.

Some banks have caught on to this practice and are putting provisions in place to prevent such fraud from occurring. Bank of America and Wells Fargo has in their short sale approval letters that the property cannot change hands over the next 30 days. On the buy side as well, most lenders (especially on FHA loans) will not lend on a home that has been owned by the seller for 3-6 months. Are you mad yet?

Here are the dangers of short sale fraud:
1. The investor doesn’t make enough money on the sale, ties up the home, and it goes to foreclosure.
2. The buyer’s loan is not approved because of an anti-flipping clause in their loan.
3. The bank sues Buyer, Seller, Agents and anyone they can connect to one of these transactions because they were defrauded out of THOUSANDS of Dollars.
4. Jail time is bad for business.  Just ask this agent

Typical script of a short sale scam artist:
I am looking to invest in short sales. REO’s too? No, just short sales over $300,000 up to $2 million. We have cash and are looking to help you with your short sale. We will do all of the negotiating for you and we’ll even list the home with you when we’re done.

If you know of someone who is involved in short sale fraud and they are an agent, contact your local association of REALTORS® and real estate commission to report them. If you ever approached by someone who wants you to commit short sale fraud, take their information and send it to the state attorney general’s office or your local attorney general.

This makes me very angry because these guys give the profession and career I love a bad name and, worst of all, they are taking advantage of a seller who is looking to them for guidance and assistance.