Looking Back:
Multiple states are cooperating in an investigation to determine whether or not lenders violated foreclosure laws when seizing houses from delinquent borrowers. The U.S. is now the second largest holder of U.S. debt. A survey from the National Association for Business Economics shows that economists expect gross domestic product will increase 2.6% in 2010 and 2011. According to a Thomson Reuters survey, 63% of potential home buyers are discouraged from buying a home because of the current economic conditions.
In The News:
MERS - “Statement by R.K. Arnold, President and CEO of MERSCORP, Inc.” (10-12-10)
“Claims that MERS disrupts or creates a defect in the mortgage or deed of trust are not supported by fact or legal precedents. This is often used as a tactic by lawyers to delay or prevent the foreclosure. The mortgage lien is granted to MERS by the borrower and the seller and that is what makes MERS the mortgagee.”
NAR - “NAR’s HouseLogic Launches Campaign to Help Military Families Sustain Homeownership” (10-11-10)
“The National Association of Realtors®’ HouseLogic, a free, comprehensive consumer website about all aspects of homeownership, today launched Operation Home Relief, a new Facebook Causes campaign. The campaign aims to increase awareness, rally support and raise funding for USA Cares, a nonprofit organization that provides counseling and financial foreclosure assistance to post-9/11 active duty U.S. military service personnel, veterans and their families. HouseLogic will donate $1 to USA Cares every time someone ‘likes’ the Operation Home Relief Cause page on Facebook and will match individual donations made to the cause, up to $20,000.”
Sign on San Diego – “Q&A: What’s going on with foreclosures?” (10-11-10)
“BofA – the only lender to have halted foreclosures in all 50 states – estimates that it could resolve the issue in as quickly as two or three weeks. Stan Humphries, an analyst with Zillow.com, an online real estate database, estimates that it could take 60 to 90 days for the entire industry to deal with the ‘robo-signer’ problem. But Humphries adds that the process could take longer if political pressure mounts for a wider-reaching examination of foreclosures.”
Los Angeles Times – “California might join probe of lenders that seized homes” (10-12-10)
“California officials are considering joining a multistate investigation of whether lenders have violated foreclosure laws when seizing houses from delinquent borrowers. The investigation, which is expected to be publicly announced Wednesday, is spearheaded by Iowa Atty. Gen. Tom Miller.”
Of Two Minds – “Imagining A Middle Class Does Not Create One” (10-12-10)
“Another measure of ‘middle class’ is even simpler: a middle class household owns some wealth. It could be a retirement fund, a free-and-clear home, a business, income property or gold/cash/investments. By that measure, the middle class comprises at best 20% of the populace.”
Bloomberg - “Foreclosure Freeze May Slow U.S. Homebuyers on Legal Worry” (10-10-10)
“A halt in home foreclosures at the largest U.S. mortgage firms may sideline buyers worried about legal issues, further depressing sales at a time when distressed properties account for almost a quarter of all transactions.”
Zero Hedge – “Three Horrifying Facts About the US Debt ‘Situation’” (10-12-10)
“this week we overtook Japan, leaving China as the only country with greater ownership of US Debt. And we’re printing money to buy it. Setting aside the fact that this is abject lunacy, this policy is trashing our currency which has fallen 13% since June… as in four months ago. Want an explanation for why stocks, commodities, and Gold are exploding higher? Here it is.”
Bloomberg - “Economists Cut U.S. Growth Forecasts Through 2011, Survey Shows” (10-11-10)
“Gross domestic product will increase 2.6 percent this year and next, according to the median of 46 economists surveyed by the National Association for Business Economics from Sept. 2 to Sept. 21. A May poll projected growth of 3.2 percent for both years. Economists also cut estimates for personal spending, employment and consumer prices.”
Housing Wire – “Zillow 30-year FRM rates hit record low for fourth consecutive week” (10-12-10)
“The 30-year, fixed-mortgage rate decreased from a week earlier, setting a new record low for the fourth consecutive week at 4.13%, according to the Zillow Mortgage Marketplace weekly update.”
Housing Wire - “Analysts optimistic on 3Q MBS REIT earnings” (10-12-10)
“With the end of the GSE buyouts, prepayment speeds slowed on agency MBS, peaking for Fannie Mae 30-year MBS at 29.9% in April and dropping down to 24.9% in September.”
Housing Wire – “Total Mortgage Services lowers rate on jumbo mortgages anticipating comeback” (10-12-10)
“Total Mortgage Services, a Connecticut-based mortgage lender/broker, sees a comeback in the jumbo mortgage market. The firm said because of a significant improvement in both competitive pricing and market liquidity for jumbo loans, it’s rate for a 30-year fixed jumbo mortgage is down to 4.9% for a loan up to $729,000.”
Housing Wire – “63% of Americans do not want to buy a home according to Reuters research” (10-12-10)
“According to a survey done by FindLaw.com, a Thomson Reuters company, 63% of respondents said they are steered away from buying a home because the current economic conditions. Only 8% said they are more likely to buy a home because of the state of the economy. About one quarter, 28%, said economic conditions do not sway their opinion about purchasing a home.”
Housing Wire – “Hoenig remains consistent with calls for no additional quantitative easing” (10-12-10)
“Speaking in Denver to the National Association of Business Economists, Thomas Hoenig said he understands the Fed’s desire to ‘do something, anything’ to revive the economy, but maintaining the zero-interest rate policy and starting a second round of quantitative easing aren’t it.”
Bloomberg - “Obama Backs State Foreclosure Probe, Against Nationwide Freeze, Gibbs Says” (10-12-10)
“President Barack Obama is throwing his support behind state attorneys general looking into filings of allegedly faulty home foreclosures while rejecting a nationwide freeze on home foreclosures because of potential ‘unintended consequences,’ said a White House spokesman.”
Bloomberg - “Real Estate `Trophy’ Prices Up 19% in Flat Market: Chart of the Day” (10-12-10)
“The CHART OF THE DAY shows prices for ‘trophy’ commercial properties are up 19 percent since bottoming in New York, Washington, San Francisco, Boston, Los Angeles and Chicago. The Moody’s/REAL Commercial Property Price Index tracking the entire U.S. has gained 1 percent from a seven-year low in October 2009.”
Bloomberg - “Foreclosure Delays May Cost U.S. Banks Up to $6 Billion, FBR’s Miller Says” (10-12-10)
“Faulty foreclosures may cost U.S. lenders $2 billion for every month that home seizures are delayed and the tab could reach $6 billion, according to Paul Miller, the bank analyst at FBR Capital Markets.”
Looking Back:
One year ago, Fitch reported that 60 percent of borrowers from 06 to 07 had negative equity. Interthinx’s Mortgage Fraud Index estimated that fraud decreased by 4 percent from Q1 to Q2 of 2009, but increased by 7 percent from Q2 of 2008. Statistics from MDA DataQuick showed that Southern California home sales increased by 5 percent from October of 2008.
For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor event calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 170 podcasts in our free investor radio archive.