Tag Archives: property

What is a Deed in Lieu?

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A Deed in Lieu of foreclosure (DIL) is an option in which a mortgagor (or a home owner) voluntarily deeds the subject property to the lender in exchange for a release from all obligations under the mortgage. A DIL of foreclosure might not be accepted from mortgagors who can financially make their mortgage payments. Often times, this can be as damaging to your credit as a foreclosure and should be considered a last resort (in most cases)

“there are several disadvantages to a deed in lieu, most importantly, it is almost as bad on your credit as a foreclosure or bankruptcy, a short sale can be viewed as a much better option in terms of your credit

“it is considerably more difficult to qualify for a deed in lieu if you have a 2nd, 3rd..mortgage

What are the benefits of a deed in lieu?

Many believe that a deed in lieu of foreclosure looks better on your credit report than does a foreclosure or bankruptcy. In addition, unlike in the short sale situation, you do not necessarily have to take responsibility for selling your house (you may end up simply handing over title and then letting the lender sell the house).

Are there disadvantages to a deed in lieu?

There are several disadvantages to a deed in lieu. If you have second or third mortgages, home equity loans, or tax liens against your property, you probably cannot qualify for a deed in lieu.

In addition, getting a lender to accept a deed in lieu of foreclosure is difficult in the current market. Banks are not in the real estate business, most lenders want cash, not real estate — especially if they own hundreds of other foreclosed properties which is a likely scenario these days. On the other hand, the bank might think it better to accept a deed in lieu rather than drag out the lengthy foreclosure process and incur more expenses. Beware of tax consequences; a deed in lieu may generate unwelcome taxable income based on the amount of your “forgiven debt.”

 

 

 

Source: http://www.sandiegohopenow.com

2011-2012 Cost vs. Value: Which Remodeling Projects Pay Off the Most?

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When tackling home remodeling projects, you’ll find some projects pay off more than others at times of resale. Remodeling Magazine, in conjunction with REALTOR® Magazine, recently released findings of its annual Cost vs. Value report for 2011-2012, revealing which remodeling projects offer the biggest bang for your buck.

Overall, the trend right now is replacement over remodeling–swapping out the old for the new rather than doing a total gut job, which can be much more costly.

This year’s Cost vs. Value report found that exterior replacement projects–such as new garage doors and a new entry door–offer some of the best returns at resale, allowing home owners to recoup close to 70 percent or more of the costs of the project at times of resale.

The following are the top, mid-range projects from this year’s report, based on what home owners stand to recoup at time of resale:

1. Replacing the entry door to steel

Estimated cost: $1,238

Cost recouped at resale: 73%

2. Attic bedroom (converting unfinished attic space into a bedroom with bathroom and shower)

Estimated cost: $50,148

Cost recouped at resale: 72.5%

3. Minor kitchen remodel (including new cabinets and drawers, countertops, hardware, and appliances)

Estimated cost: $19,588

Cost recouped at resale: 72.1%

4. Garage door replacement

Estimated cost: $1,512

Cost recouped at resale: 71.9%

5. Deck addition (wood)

Estimated cost: $10,350

Cost recouped at resale: 70.1%

6. Siding replacement (vinyl)

Estimated cost: $11,729

Cost recouped at resale: 69.5%

 

 

By Melissa Dittmann Tracey, REALTOR® Magazine

http://styledstagedsold.blogs.realtor.org/2012/01/25/2011-2012-cost-vs-value-which-remodeling-projects-pay-off-the-most/?cid=WR02012012:41359&ed_rid=2422408

Foreclosure Homes Account for 20 Percent of All U.S. Residential Sales in Q3 2011 According to RealtyTrac(R)

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RVINE, CA, Jan 26, 2012 (MARKETWIRE via COMTEX) — RealtyTrac(R) ( www.realtytrac.com ), the leading online marketplace for foreclosures, today released its Q3 2011 U.S. Foreclosure Sales Report(TM), which shows that sales of homes that were in some stage of foreclosure or bank owned accounted for 20 percent of all U.S. residential sales in the third quarter of 2011, down from 22 percent of all sales in the second quarter and down from 30 percent of all sales in the third quarter of 2010.

Third parties purchased a total of 221,536 residential properties in some stage of foreclosure (NOD, LIS, NTS, NFS) or bank-owned (REO) during the third quarter, down 11 percent from a revised second quarter total and down 5 percent from the third quarter of 2010.

The average sales price of homes in foreclosure or bank owned was $165,322 in the third quarter, up 1 percent from the previous quarter but down 3 percent from the third quarter of 2010. The average sales price of these foreclosure-related sales was 34 percent below the average sales price of homes not in foreclosure, matching the 34 percent foreclosure discount in the second quarter but below the 37 percent discount in the third quarter of 2010.

“While foreclosures continue to represent an excellent bargain-buying opportunity for many buyers and investors, foreclosure sales accounted for a smaller share of the total market in the third quarter. That trend is not too surprising given the continued ambiguity surrounding proper foreclosure procedures — and the ripple effect that has on sales of foreclosed properties that might have been improperly foreclosed,” said Brandon Moore, chief executive officer of RealtyTrac. “The sooner the market gets more clarity about accepted foreclosure procedures, primarily through the long-promised settlement between multiple states attorneys general and major lenders, the sooner the market can more efficiently dispose of these distressed properties.

“Even with the hurdles to selling foreclosures, foreclosure sales continue to represent a historically high percentage of all sales,” Moore continued. “In 2005 and 2006, foreclosure sales consistently accounted for less than 5 percent of all sales nationwide.”

Pre-foreclosure sales flat from year ago, REO sales down A total of 92,824 pre-foreclosure homes — in default or scheduled for auction — sold to third parties in the third quarter, a decrease of 9 percent from the previous quarter and nearly identical to the 92,967 pre-foreclosure sales in the third quarter of 2010. Pre-foreclosure sales accounted for nearly 9 percent of all sales, the same as in the second quarter, but down from 12 percent of all sales in the third quarter of 2010.

Pre-foreclosure sales increased more than 30 percent on an annual basis in Michigan (up 68 percent), North Carolina (up 44 percent), Ohio (up 43 percent) and Georgia (up 35 percent). Pre-foreclosure sales outnumbered REO sales in several states in the third quarter, including Colorado, Florida, New Jersey and New York.

Pre-foreclosures, which are often sold via short sale, had an average sales price nationwide of $191,119, a discount of 24 percent below the average sales price of homes not in foreclosure. That was up from the 23 percent discount in the previous quarter and matched the 24 percent discount in the third quarter of 2010. Pre-foreclosures that sold in the third quarter took an average of 318 days to sell after receiving an initial foreclosure notice, up from an average of 245 days in the second quarter and average of 236 days in the third quarter of 2010.

A total of 128,712 bank-owned (REO) homes sold to third parties in the third quarter, down 13 percent from the second quarter and down nearly 8 percent from the third quarter of 2010. REO sales accounted for nearly 12 percent of all sales in the third quarter, down from 13 percent of all sales in the previous quarter and down from nearly 18 percent of all sales in the third quarter of 2010.

Nationally, REOs had an average sales price of $146,437 in the third quarter, a discount of nearly 42 percent below the average sales price of homes not in foreclosure. That matched a 42 percent discount on REOs in the second quarter, but was down from a 45 percent discount in the third quarter of 2010. REOs that sold in the third quarter took an average of 193 days to sell after being foreclosed on, up from 178 days in the second quarter and 161 days in the third quarter of 2010.

Nevada, California and Arizona post highest percentage of foreclosure sales Foreclosure-related sales accounted for nearly 57 percent of all residential sales in Nevada during the third quarter, the highest percentage of any state. Third parties purchased a total of 13,992 homes in foreclosure or bank owned in Nevada during the third quarter, nearly identical to the 13,858 foreclosure-related sales in the previous quarter, but up 24 percent from the third quarter of 2010.

Third parties purchased a total of 62,583 homes in foreclosure or bank owned in California, representing nearly 44 percent of the state’s total residential property sales in the third quarter — the second highest percentage of any state. Foreclosure-related sales in California decreased nearly 7 percent from the previous quarter but were up 7 percent from the third quarter of 2010.

Arizona foreclosure-related sales accounted for 43 percent of all sales in the state, the third highest percentage of any state. Third parties purchased a total of 21,619 homes in foreclosure or bank owned in Arizona during the quarter, down nearly 14 percent from the previous quarter, but up 19 percent from the third quarter of 2010.

Other states where foreclosure-related sales accounted for at least 20 percent of all sales included Georgia (34 percent), Colorado (26 percent) and Michigan (23 percent).

Due to a nearly 30 percent decrease from the previous year, Florida foreclosure-related sales in the third quarter accounted for 19 percent of all sales in the state — down from 39 percent of all sales in the third quarter of 2010.

Click here for information on the U.S. metro areas with the biggest foreclosure discounts.

Report License The RealtyTrac U.S. Foreclosure Sales Report is the result of a proprietary evaluation of information compiled by RealtyTrac; the report and any of the information in whole or in part can only be quoted, copied, published, re-published, distributed and/or re-distributed or used in any manner if the user specifically references RealtyTrac as the source for said report and/or any of the information set forth within the report.

Order Customized Reports Detailed and historical foreclosure data used to create the above report may be purchased through the RealtyTrac Data Licensing Department at 949.502.8300 Ext. 158. Aggregate data is available at the state, metro, county and zip code levels dating back to 2005, and address-level foreclosure records are also available historically.

About RealtyTrac Inc. RealtyTrac ( www.realtytrac.com ) is the leading online marketplace of foreclosure properties, with more than 1.5 million default, auction and bank-owned listings from over 2,200 U.S. counties, along with detailed property, loan and home sales data. Hosting more than 3 million unique monthly visitors, RealtyTrac provides innovative technology solutions and practical education resources to facilitate buying, selling and investing in real estate. RealtyTrac’s foreclosure data has also been used by the Federal Reserve, FBI, U.S. Senate Joint Economic Committee and Banking Committee, U.S. Treasury Department, and numerous state housing and banking departments to help evaluate foreclosure trends and address policy issues related to foreclosures.







Source: RealtyTrac http://www.marketwatch.com/story/foreclosure-homes-account-for-20-percent-of-all-us-residential-sales-in-q3-2011-according-to-realtytracr-2012-01-26

					

		
		
	


				
					
	

		

						
City Could Keep Scofflaws From Getting New Building Permits

			
						

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The City Council today voted to move forward with the “Clean Hands” Ordinance, a new ordinance modeled on a 25 year old LA County law that prohibits a contractor from pulling permits (e.g., for grading work) when in violation of codes or regulations (e.g., doing grading work without a permit). If passed, the new ordinance would require property owners to bring their properties in accordance with zoning and land use requirements before they can be granted new permits. According to the motion requesting the ordinance, “There have been instances where a project has been cited for a certain violation but continues to pull permits for a different matter. This type of activity should not be allowed. Once a project has violated the law, and issued a stop work order permit, they should not be allowed to continue the project on any level without first complying with their initial violation.” The motion goes on to call the current permit process “a major loophole in the land-use regulation enforcement process which allows for constant abuse of City policy” and instructs the Planning Department, City Attorney’s Office, and the Department of Building to draft an ordinance similar to the LA County ordinance.


So far the motion has gone through public hearings in front of the City Council’s Planning and Land Use Management and the Audits and Governmental Efficiency committees, where a number of homeowners groups turned out to support the concept. Interestingly, the support (in the form of public speaker cards and letters, at least) has come exclusively from homeowners groups located in canyon and hillside areas of the city. The groups that have sent letters of support so far could easily be described as “fancypants”: the Tarzana Property Owners Association, the Brentwood Residents Coalition, the Bel Air Beverly Crest Neighborhood Council, the Federation of Hillside and Canyon Associations, the Upper Mandeville Canyon Association, the Westwood South of Sana Monica Blvd Homeowner’s Association, and the Pacific Palisades Community Council, among others.




After a public hearing on the Westside back in August, Councilmember Dennis Zine, who proposed the ordinance, told the Mar Vista Patch, that he was “surprised by the number of complaints that emerged” at the meeting, with locals rattling off examples of violations. In a letter to the city, the Federation of Hillside and Canyon Associations cites a couple of problem properties, including one on Tower Lane in Benedict Canyon that is seeking “ministerial” and “by right” grading and building permits for a 60,000 square foot “museum-sized mega-mansion” despite the property having violations (and doesn’t that sound just exactly like the Benedict Canyon megacompound fight, starring a Saudi prince and Michael Ovitz?), and a property owner in Franklin Canyon who is seeking building permits after grading “massive swaths of hillside without permits and in defiance of a stop-work order.”


Councilmember Zine tells Curbed that the ordinance grew out of a response to the news last year of a bribery and corruption scandal at the Department of Building and Safety: “After it was reported that an FBI investigation was taking place in the Department of Building & Safety…the community brought this issue to my attention,” adding “the bottom line is that we have laws and standards in place, including building and zoning codes, to ensure public safety. For those who do not want to comply, there are consequences.”


Ben Saltsman, planning deputy to County Supervisor Zev Yaroslavsky, told the August hearing that the county has “yet to lose a legal challenge” to the ordinance.




 


 


Source: www.lacurbed.com by James Brasuell

					

		
		
	


				
					
	

		

						
‘Robo’ Foreclosure Settlement Turns Political

			
						

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For over a year now, state attorneys general have been negotiating some kind of settlement deal with the nations four largest lenders, as well as several smaller ones.


The settlement pertains to faulty foreclosure processing, first uncovered in October of 2010 and now commonly referred to as “Robo-signing.”


Rather than dozens of lawsuits, the states initially were looking to assess one great punishment on the lenders and thereby appease borrowers who felt they were wronged. The banks were looking for wider immunity from securitization issues, and that is largely what has held up the negotiations for so long.


Now, suddenly, after umpteen “we’re close to a deal”s, apparently we’re now really close to a deal, largely because the State of the Union address is next Tuesday, and this is an election year. So at a meeting of Mayors Wednesday, the Secretary of Housing and Urban Development, Shaun Donovan, mentioned that a settlement would include principal reduction for about a million borrowers.


“With few other tools to help housing, the administration sees the deal as a way to take credit for helping underwater borrowers without exposing taxpayers to loss,” says Jaret Seiberg at Guggenheim partners, noting that the deal may not fully be in place by Tuesday, but a “framework” could be announced. “If this deal does score enough political points, then it will dampen calls for the administration to roll out more housing help such as a mass refinancing. As we remain dubious about the real impact of a deal, our view is that the administration will face pressure this spring to do more. That means more refinancings of GSE loans will still be on the table,” he adds.


Of course we already know the basic framework of the deal, which would involve up to $25 billion from the banks, though only a small portion of that would be a cash settlement. The bulk of the money would be used to do principal write downs, short sales, and more aggressive loan modifications. Unfortunately, several key states, including Massachusetts, California, New York, Delaware and Nevada have expressed serious concerns about the deal currently on the table, and some bank sources are telling us that without California and New York, it’s hard to see how there would be a deal.


If there is a deal, beyond the politics, it could have a larger effect on the state of the housing market and its recovery. Remember, this deal is about foreclosure processing, which has been nearly stalled in many states. “To that end, it will give banks some increased certainty about their ability to foreclose in those states that sign on to the agreement. As a result, we may see foreclosures ramp up fairly quickly in those states,” says Josh Rosner of Graham-Fisher.


 


Rosner calls the deal “somewhat nonsensical,” even without knowing the full details, as he believes it offers no assurances to any state regarding specific amounts of relief, not to mention leaving questions about the credibility of the monitoring, oversight, compliance and enforcement of the deal terms. “The expected political calculus is that the public will see the headline and will not bother to watch the operationalization or follow-through,” says Rosner.


My concern is about this principal reduction headline. Yes, the banks processed foreclosures using improper methods, having one person sign off on thousands of documents that were never read. Yes, there was a huge breakdown in accountability and a huge lack of attention paid to struggling borrowers. The trouble is, after going over these cases, the bottom line is that the vast majority of the foreclosures were and are valid. People didn’t pay their mortgages. So now you’re offering cash back to these borrowers, perhaps even their homes back, while others in the very same position, who may have had their foreclosures processed correctly, get nothing.


 


 


Published: Thursday, 19 Jan 2012 by Diana Olick CNBC Real Estate Reporter

					

		
		
	


				
					
	

		

						
RELO 101 – What You Should Know About Relocation Packages

			
						

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Companies often hire employees from out of the area or transfer existing employees to another office. When this happens, a relocation package — or RELO as it’s known in the real estate world — may come into play.


Usually a third-party RELO company handles nearly all aspects of the employee’s home sale on behalf of the employer. In brief, RELO packages offer financial incentives to employees who must sell their current home and buy a new one in the city to which they’re relocating.


Here’s what you need to know about RELO packages.


Moving costs are usually covered


The RELO package you’re offered can depend on the type of job you have, how senior your position is, and/or how long you’ve been with the company. The more the company really wants you to take the job, or the higher up you are in the organization, the better your RELO package is likely to be.


At a minimum, a company will usually pay for your moving expenses — the boxes, the movers, and even temporary housing in the new city while you look for more permanent housing.


You may get closing costs and a lower interest rate


Many companies take it a step further, offering incentives for purchasing a home in your new city within one year of relocating.


The company may pay some or all of your closing costs, so there’s little out-of-pocket expense for you. Even in this economy, companies that are doing well, or that are working hard to court you as an employee, may also buy down the interest rate on your new home’s mortgage or give you a loan at a super-low rate.


Down payment help


Some companies will also provide down payment assistance.


A choice of agents


The third-party RELO company often provides you with a choice of real estate agents to work with, though you can ultimately chose your own. Generally, the agents who work with RELO companies are guaranteed a steady stream of buyers — and they pay a hefty referral fee to the RELO company.


Help selling your home


RELO packages will often help you sell your existing home so that you’re free to move for your new job. The RELO package will usually pay your closing costs, including real estate commission. This can be a huge savings, particularly now, with real estate prices down.


Selling at a loss? No worries


In the event you must sell at a price less than what you owe, your employer may cover the loss.


To make this work, the RELO company sends a few agents to do a broker marketing analysis, similar to a Comparative Market Analysis (CMA). You and the RELO company discuss the price and options, but ultimately you choose the agent and the price.


When a buyer makes an offer, it gets negotiated verbally. Just before signing the offer, you, as the seller, will generally sign over the grant deed to the RELO company, thus making the RELO company the seller. The RELO company, and not you, signs the contract with the buyer.


RELO situations can stretch out the process


If you’re a buyer working with a RELO company on a purchase, the timing will be a little longer than normal, and you’ll have more paperwork to sign.


On top of the seller’s disclosures, the RELO company will likely have its own contract and disclosure documentation for the buyer to review and sign. If you like the home, be patient. You may in fact have to do some negotiations with both the seller and the RELO company.  In addition, you may be subject to some verbal negotiations prior to actually signing an offer.  It’s all part of the process.


A “Guaranteed Buy-Out” is the RELO package jackpot


A very high-level person courted by a company may be offered what’s known as a Guaranteed Buy Out (GBO). The GBO essentially removes nearly all the risk from the employee/seller.


With a GBO, the RELO company hires two independent appraisers prior to listing the home. If you, as the seller, are unable to sell the property on your own and within a certain time period, the RELO company agrees to buy your home for the average of the two appraisals.


There was a case in San Francisco in which an executive was transferred just as the real estate market was crashing. His three-bedroom condominium was originally listed for $1.75 million and, after several months of marketing, was taken off the market. The buyout happened as agreed. The real estate market continued to fall. The RELO company—rather than the employee—ended up taking the hit, ultimately selling the condo for close to $1.2 million.


Buyer beware


Buyers considering purchasing a property being sold in a GBO should do as much due diligence as possible. That’s because the RELO company, much like a bank owning a foreclosed home, doesn’t have any history with the property (as a homeowner would) and therefore won’t be able to provide much assistance. So you should inspect the property top to bottom, see it in multiple lights, and do your best to glean as much information as you can.


Also, be aware that even though the RELO company wants to get the property off their books, they may or may not be more flexible on price, depending on the situation.


 


 


 


DATE:JANUARY 18, 2012 | AUTHOR: BRENDON DESIMONE |  ZILLOW

					

		
		
	


				
					
	

		

						
Eviction of Tenants From Foreclosed Residential Rental Properties

			
						

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On December 19, 2008, the City of Los Angeles added Ordinance No 180441  to the Los Angeles Rent Stabilization Ordinance (“LARSO) to regulate the grounds for eviction of tenants from foreclosed residential rental properties.  The amendment only applies to properties that are purchased at a foreclosure sale on or after December 17, 2008 by a lender, mortgagee, or beneficiary of a deed of trust, or an agent thereof, in full or partial satisfaction of a default obligation.


The stated purpose of the new ordinance is to prevent the displacement of tenants and the loss of rental units in the City of Los Angeles due to foreclosures of the property, and to prevent homelessness and nuisances and blight caused by vacant foreclosed properties.


LARSO only applies to properties in the city of Los Angeles. (please see map attached to determine if property is in the city of Los Angeles).  Please note that that the areas of Westchester, San Pedro, Hollywood, Northridge, Encino, Woodland Hills, Van Nuys, Sunland, Canoga Park and Eagle Rock are all within the city of Los Angeles.


Previously under LARSO, rent control covered all residential units EXCEPT those fitting specified categories. The two biggest exemptions were (1) single family dwellings and (2) units built after 1978.   Under these exemptions, the lender was free to evict without cause.  However, with the passage of Ordinance No 180441, the foregoing exemptions were removed for a one year period for properties purchased at foreclosure sales.


Therefore, virtually all properties purchased by lenders at foreclosure sales in the City of Los Angeles that are occupied by renters are now subject to eviction control


Under LARSO you cannot be evicted except for one of 12 listed reasons.  The reasons for which tenants may be evicted include; nonpayment of (legal) rent, breaking a term of the lease, causing a nuisance [including drugs and gangs], using the unit for an illegal purpose [eg, a machine shop in an apartment], refusal to renew the lease on similar terms, refusal to permit the landlord reasonable entry to inspect, repair or showing the premises to prospective purchasers, or there is a different person in possession of the unit than who rented it.   (please see attachment “12 reasons for eviction”