Against All Odds, 18 months later SUCCESS

This was a historic file for 360 Group. 18 months of hard work, multiple submissions and over 100 follow calls. This is a good example of the shear tenacity of Mel, my partner. Mel has never given up on any of our clients, but sometimes, over time situations change leaving us with few options. Income changes, employment changes, and other things that can affect the result of a file that may begin as a mod and turn into a short sale often out of our control.

In this case, Mel just would not allow the lender to bully her and she just kept fighting for the client. We thank our client in Las Vegas also who through countless requests for documentation, stayed with us the whole way. We can laugh now at the many tears of frustration during the process. At the one year mark, everyone was ready to quit…except Mel. She was not going to let 12 months of work go down the drain.

BELOW IS JUST A SHORT SUMMARY OF THE PROGRESSION OF THIS FILE.

Jan 2010 client is referred to 360 Group. Feb 2010 file is in review. March negotiator switched at lender. April lender says qualifies for MHA, send updated docs and MHA package. May 2010 Property status changes, need updated docs to show insurance,  June 2010 B of A says MHA mod ppwrk is going out. Client never receives, we follow up 4 times this month, bank says client missed a payment so file is now in Default department starting over. Client says they did not miss a payment so we need documentation to prove to lender. Turned out client was making early payments and bank was applying to principal so when actual payment date came and no payment was made they thought it was late. File moves back to imminent default (current payments)  June 2010 underwriter assigned.

June 2010, Bank begins to call borrower leaving message that it’s imperative to contact them. We call to see what bank needs and they say file is complete and in review. Negotiator says package is going out to borrower, when it arrives, it is just another new form for them to complete and send back. July 2010 personal situation changes status of home borrower needs to update title information with county recorder’s office. August 2010 Deed changed recorded and finally received at bank. Sept 2010 bank requests all new updated financials from client. October 2010 borrower has a couple bad months in business and cannot pay mortgage so goes late. File is denied for Modification – 360 Group files appeal with lender stating that numbers make sense and NPV test helps Note holder. Nov 2010 360 Group re-submits file and requests appeal running up to VP level. Bank requesting more documents and tax returns. Dec 2010, back with another underwriter for review. Jan 2011, 360 Group escalates file to management saying this has taken way too long and requesting Forbearance Plan. Borrower qualifies for mod, and is not a risk for future default if payment is lowered. Feb 2011 old authorizations expire so need new auths. March 2011 bank requests updated bank statements and pay stubs. April 2011 file approved for MHA but needs to be approved by Note holder. May 2011, no response from lender. Several follow ups gone unanswered, again escalate to senior VP. End of May, Forbearance is issued. Client must make payments with no grace period for 90 days to get final mod. Papers sent and signed. June 2011, underwriting requests updated documents – looking for reason to deny mod. July 2011, 360 Group follows up and bank says they will review after 60 day mark. August, bank request updated financials – gathered and sent. August 26th Final Trial Modification approved and package going out to client for review and signature.

Another happy client.

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Double Success

Shortly after we successfully modified Dawn Streakers first mortgage, she suggested that we settle her second mortgage and make it go away. EMC has been a decent lender to work with in the past, but we always set the expectations with the client that we’re never 100% sure what the settlement amount will be if any. Sometimes the lender will only offer a modified payment like 2% at 20 years which is still not bad for a second mortgage.

The balance on her second mortgage was over $87,000 and in just 3 short months we got a settlement of $26,000. We’re pleased to report that our client has saved more than $200,000 from the first mod with a $140,000 principal reduction and the settlement on the second.

Thank you for the many referrals. Enjoy your home Mr & Mrs Streaker, you are now in a good position moving forward and we’re glad we could be of assistance.

2011 Q3 Report

The nation’s housing crisis has forced unprecedented numbers of homeowners out of their homes, made for a difficult home buying environment, and tainted many Americans’ ideal of owning a home. These factors are taking their toll on homeownership in this country.

The Census Bureau says homeownership in the United States has fallen to its lowest level in more than 13 years. The nation’s homeownership rate dropped to 65.9 percent in the second quarter. That’s a full percentage point lower than the second quarter of 2010 and a half a percentage point below the rate recorded in the first quarter of 2011.

 

Paul Dales, senior U.S. economist with the research firm Capital Economics says the increase in the homeownership rate seen during the housing boom has been more than completely wiped out by the bust.

 

 

And the decline is not even over yet, according to Dales. He says the poor economic climate, the double dip in house prices, the high number of foreclosures, and tight credit conditions are all reasons why the home ownership rate will continue to fall.

 

“With another 3 million foreclosures in the pipeline and no sign of a major improvement in credit conditions or the labor market, demand for owner-occupied housing is likely to remain weak for some years yet,” Dales said. The flipside will be a further surge in demand for rented accommodations, Dales notes, which will boost rental rates and bodes well for the multi-family sector, in particular.

In line with the steep declines seen in homeownership, the share of all households renting increased to a new 13-year high of 34.1 percent in the second quarter, Dales explained. That’s up from 33.6 percent in the first quarter.

The rental vacancy rate has fallen to 9.7 percent from a peak of 11.1 percent in 2009, which has driven a recovery in rent prices. Dales says investors in the residential rental market could see rental yields of more than 5 percent over the next few years. Data from the Census Bureau also showed that the homeowner vacancy declined from 2.6 percent in the first quarter to 2.5 percent in the second.

Still, Dales notes that the numbers reflect there are 1.9 million homes up for sale that are still sitting empty. He says another 3.9 million homes are empty but, for one reason or another, are being held off the market.  The excess supply of housing remains high, and Dales stressed that the combination of weak demand and high supply almost certainly will not translate into higher house prices any time soon.

 

MORTGAGE INTEREST ON THE CUT LIST

What many consider to be a staple of American homeownership is expected to be on the chopping block as lawmakers in Washington look to trim the nation’s deficit. The prized mortgage interest tax deduction has been part of the federal tax code since 1913. Currently, it costs the U.S. Treasury an estimated $94 billion a year. Under existing tax rules, homeowners may deduct the interest accumulated on up to $1 million of their mortgage debt and up to $100,000 of home equity loan debt. Mortgages on both primary residences and second homes qualify for the deduction.

Congress has tossed around several proposals for amending this part of the federal tax code, including lowering the debt limit from $1 million to $500,000 on first mortgages. According to an analysis from many agencies, a reduction in the principal balance of deductible mortgage debt to $500,000 would raise only $5 billion per year for the IRS. Economist William Wheaton at MIT has a higher estimate for the savings. He told CNBC’s Diana Olick that cutting the debt cap in half would return $15 billion a year. Lawmakers are also considering eliminating the deduction altogether for second homes and this move would bring in another $15 billion for the government.

A separate scenario that was proposed by President Obama’s hand-picked deficit commission would replace the deduction with a 12 percent tax credit, which would also have a $500,000 principal cap.

 

 

Good News for people looking for a job and others who want to work from home

CNN just reported that the FCC says that call centers are poised to add 100,000 new jobs to the economy. You’ll get your very own cubicle! Or, at least, your very own partition. The call centers jobs are coming about as some companies decide to stop outsourcing their customer service overseas and start “onshoring” it instead. A business group calling itself “Jobs4America” is announcing the project alongside the FCC. Some of the jobs will be in call center facilities, others will be “home-sourced,” which means the workers will work at computers and with headsets in their own homes.

The group has said their plan is to “target areas with high unemployment.” This is a very good strategy because with the high turnover and burnout rates seen among call center workers, you need to have nice big pools of people who have few other choices to churn through.