December 6, 2011 By

Statewide News Is Much Different Than Porter Ranch and other San Fernando Valley Towns.

 

 

Statewide news of moderate drops in valuation do not reflect accurately what is going on locally in towns throughout San Fernando Valley.

Last month in the Valley the median price of a previously owned home was $350,000, down 9 percent from a year earlier. And it is just 3 percent above the low for this cycle of $339,900 reached in February of 2009.

And 3 percent is not much distance to cover in this market. October’s median fell by that much from September.

October’s numbers also show just how this once high-flying housing investment has tanked, too.

 

The median price, the point at which half the homes cost more and half less, topped out at $655,000 in June of 2007. By October it was 46.6 percent, or $305,000 under that level.

The condo market is faring a little better.

Last month’s condo price settled at $225,000, up 21.6 percent from the low point of $185,000 reached in May of 2009.

But it is 45.8 percent, or $190,000, under the record high $415,000 in February of 2006.

The local market is not mirroring the state activity which has San Francisco to keep to  correction statewide from being so dramatic.

the lesson to be learned if you want to know history of local towns of Porter Ranch, Granada Hills, Chatsworth, Woodland Hills etc, you need to pay attention to local news.

Filed Under: Business, City News, Foreclosure Information, Investment Real Estate, Porter Ranch, Real Estate, San Fernando Valley, Selling a home, Short Sale Information

Lower Price Homes Sell Better in Porter Ranch and greater Los Angeles Area

November 16, 2011 By

By Dave Friedman, Realtor at 818Myhouse.com licensed by Keller Williams Realty

The United States government is starting to back out of guaranteeing some residential mortgages which impacts the Porter Ranch and surrounding neighborhoods.

IMPACT ON SIZE HOMES SOLD IN PORTER RANCH, CHATSWORTH, GRANADA HILLS AND SURROUNDING AREAS:

The government guarantees about 90% of new mortgages — essentially propping up the home loan market after credit dried up and home sales plunged in the wake of the subprime mortgage crisis. The loan limit determines the maximum size of a mortgage that the Federal Housing Administration, Fannie Mae and Freddie Mac can buy or guarantee.

So-called nonconforming jumbo loans that are offered on the private mortgage market typically require bigger down payments and carry a higher interest rate, resulting in higher monthly payments for borrowers. In Los Angeles and Orange counties, the limit for FHA, Fannie and Freddie loans dropped from $729,750 to $625,500.

If the real estate market remains soft there may be political pressure to raise the limit back up to $729,750.

Short Sale Home Impact in San Fernando Valley areas such as Porter Ranch, Granada Hills and Chatsworth:

It is becoming more difficult to sell a more expensive short sale home.  Buyers need to come into escrow with larger down payments for homes  priced at over $650,000.  Short selling a home is much more beneficial as compared to allowing a bank to foreclose.  Short sale home buyers can come into the market to buy a home in 2-3 years in many cases with lower costs as compared to foreclosed home buyers.

Time will tell whether the government is pressured into raising the limit of loan guarantee.

Filed Under: Foreclosure Information, Short Sale Information

Loan Modifications, The Good, Bad and the Ugly

November 8, 2011 By

By Dave Friedman, Realtor and Certified Foreclosure Specialist

With an estimated $7 trillion dollars lost in the real estate market since the “Big Recession”, many Americans want to look at loan modifications. There are limited situations where a loan modification makes sense and may turn out good for the homeowner, which may be construed as good such as when your home is slightly upside down compared to the debt and your interest rates are high. The bad loan modifications have no real principle reduction. The ugly can be a process of applying for a loan modification that drives the homeowner straight into foreclosure with time running out for a short sale.

The Good: If your home is slightly upside down, then it may make sense to obtain a loan modification with lower interest rates such as President Obama’s Home Affordability and Stability Plan. According to the new program that may roll out in the near future there needs to be at least 80% loan debt to value or higher. There have been other similar loan modification programs such as HAMP (home affordability modification program) that are at the option of the banks which has temporarily worked for about 8% of the distressed homeowners. Most of those modifications turn into short sales or foreclosures if the home owner is still struggling financially. If you are not making payments the banks are more motivated to create a loan modification. Many banks do want to see that you are now working with monthly expenses and income within a few hundred dollars of each other. Unemployed need not apply.

The Bad: Some lenders will work with reducing payments based on a lower loan principle which sounds exciting but isn’t. If a home owner has $200,000 of debt over the home value, some banks will make the payments based on a principle reduction of $200,000. When the time comes to sell your home the bank will require you to pay them back the original full principle which is the remaining principle plus the principle reduction of $200,000 out of escrow.

The Ugly: The worst case is a bank sucks the last amount of money from you under the temporary payment plan and then turns down your loan modification. A trial period is frequently required for your loan modification with the criteria listed above. The banks can then turn your permanent loan modification down forcing you into foreclosure with limited time permitted for a short sale if you can not make the loan current. The clock in many cases of when the home is to go to trust deed sale does not stop. It may get postponed by one or two months at a time. This is an abuse of the distressed homeowner when the recommendation should have been a short sale for everyone’s best interest.

Before deciding whether a loan modification is a good option, you need to see if your home is worth less than the loan. If your home is upside down by a large sum to your standards and you have endured a hardship of lower income or increased expenses, then you have two choices to cut off excess home loan debt. A foreclosure will wipe your debt clean when you return the house back to the lender which includes a large credit hit. A short sale is the best tool which will allow the debt to be wiped clean and allowing you back in the home purchasing market (in a few years) at a lower cost than a foreclosure on your credit report.

Many distressed home owners fall into the category of large debt above their home value. Some homeowners are waiting out of fear. There is a window closing by the end of 2012 which waves tax liabilities on the forgiven owner occupied debt. The short sale process is a great opportunity for families to start fresh with no house debt. Be very careful about whether a loan modification is the best solution since your family should not put themselves second to a bank. It is important to discuss your options with a certified short sale and foreclosure specialist such as myself.

Your property sale, purchase, investment or distressed loan resolution will be a comfortable and stress free experience from my over 20 years in the real estate business. You can call me with any Real Estate Questions at 818-Myhouse (694-6873). 818MyHouse.com with Keller Williams Realty – My Experience Turns Your Real Estate Dreams Into Reality.

Filed Under: Foreclosure Information, Investment Real Estate, Porter Ranch, Real Estate, Short Sale Information

Life After A Short Sale Versus a Foreclosure

September 20, 2011 By

Life After A Short Sale Versus a Foreclosure

By Dave Friedman, Realtor and Certified Foreclosure Specialist

You very well may know someone who has gone through a home short sale or foreclosure.  There is not a great social stigma with homeowners who have to deal with leaving a home that has more debt than value if there is a drop in family income.  Not only do families get rid of over $100,000 of upside down debt in many cases, they may be eligible in a few years to purchase a new home for a much lower price.  The key to positioning oneself to purchasing a home again is how the process is handled.

Homeowners who speak to a certified foreclosure Realtor can get to the bottom line of whether a short sale is a good option. The short sale is selling a home through a Realtor with the banks approval versus making the bank spend $50,000 in the foreclosure process.  The key in a short sale is showing more expenses than income as well as not having a large sum of cash in the bank, i.e. tens of thousands of dollars.  An attorney should be used to review their situation especially if loan fraud is of concern by the lender.  Do not fall into the trap of paying an attorney to negotiate for lower payments while praying the bank will reduce the total debt owed while keeping the home.  I have seen to many home owners spend thousands while wishing a short sale was handled in the first place which costs nothing in most cases.

There are federal and state laws in the homeowners favor.  There is no tax and no carry forward debt on the deficiency or the difference on the sale revenue a bank receives compared to the higher total loan debt.  This forgiven debt can amount to hundreds of thousands of dollars.  I often educate home owners the fact that this nontaxable gift of debt forgiveness often means the difference of paying the bank back for many years on the upside down debt versus applying the savings for a good use such as your families retirement.  Homeowners should always consult with their tax expert.

The reason a short sale is preferred over letting a home go into foreclosure pertains to the ability to purchase another home in a few years.  The short sale is bank approved and is viewed in a better light.  The time frame to restore much of the fico score is about 3 years for either avenue but the cost of a new loan will be higher with a foreclosure on a credit report.
Your property sale, purchase, investment or distressed loan resolution will be a comfortable and stress free experience from my over 20 years in the real estate business.  You can call me with any  Real Estate Questions at 818-Myhouse (694-6873).  818MyHouse.com with Keller Williams Realty – My Experience Turns Your Real Estate Dreams Into Reality.

Filed Under: Foreclosure Information, Real Estate, Short Sale Information

Porter Ranch Home Foreclosure Delays

June 28, 2011 By

Porter Ranch Home Foreclosure Delays Due to Bad Bank Paperwork

Lender processing delays reduced the number of U.S. homes taken back by banks in the first three months of the year and contributed to a sharp drop in properties entering the foreclosure pro­cess.

But March foreclosure data suggest foreclosure activity may be starting to creep higher, as lenders make progress tackling a backlog of pending foreclo­sure cases.

Banks repossessed 215,046 homes in the January to March quarter, down 6 per­cent from the fourth quarter and down 17 percent versus the same period last year, foreclosure listing firm Real­tyTrac Inc.

Banks Overwhelmed With Home Forclosure Paperwork

The number of properties receiving a notice of default for the first time also declined, falling 17 percent from the fourth quarter and 35 percent from the first three months of last year, the firm said.

The dropoff in foreclosure activity stems from foreclo­sure documentation prob­lems that came to light last fall. Many banks have since revisited thousands of fore­closure cases, delaying the processing of new foreclo­sures. The logjam has been compounded by court delays in states such as Florida, New York, and New Jersey, where foreclosures must be approved by a judge.

Still, between February and March, the number of properties repossessed by banks rose 13 percent, the highest increase in a year. And homes receiving their first notice of default climbed 16 percent.

“The bottleneck is opening up a little bit and we’re start­ing to see the first inklings that we might be getting back to more normal levels of foreclosures,” said Rick Sharga, a senior vice presi­dent at RealtyTrac.

By normal levels, Sharga means the elevated pace of foreclosure activity that led to more than 1 million homes being taken back by lenders last year.

Roughly 5 million borrow­ers are at least two months behind on their mortgages, by some estimates. And many of the factors that have contributed to the foreclo­sure crisis are likely to con­tinue driving foreclosures this year, including high unemployment, a weak hous­ing market, falling home val­ues and tighter lending stan­dards.

The foreclosure processing delays remain most pro­nounced in states where judges play a role in the fore­closure process. In Florida, for example, foreclosure activity has fallen 47 percent since the fourth quarter, and it’s taking nearly 17 months from the time a property receives its initial notice of default until it is put up for auction. That process normally takes about four months, Sharga said.

Filed Under: Foreclosure Information