San Diego Negative Home Equity
San Diego real estate mortgage bust. Much has been made of stated income, nina, ninja, etc. loans. The fact remains that the debt to income levels that were accepted during the boom time for people who could document their income exceeded 55%. Sub prime borrowers who could document their income could have DTI levels from 50-55%.
What is not talked about is that Fannie and Freddie loans could get approved with DTI levels as high as 63%. Typically a borrower would need some other strong factor such as high FICO or 6-8 months in reserve. Nevertheless, people are not walking from their homes just because they are upside down. Like most things in life there is rarely one answer, rather a multitude of factors.
Get ready for the next wave of foreclosures, just months away. This new wave of foreclosures will be prime mortgages on upper end homes. San Diego real estate agent
San Diego Home Mortgage Lenders … Hardball or Common Sense?
It's a shame, but in today's San Diego real estate environment, home lenders have taken on the personification of evil. It seems we are always hearing about San Diego banks or home mortgage lenders who do not want to work with homeowners in trouble.
Though this may have held some validity a year or two ago, it is just the opposite today. Effective July 1, 2008, a new California law mandates that the lenders try to contact and work with homeowners prior to filing a notice of default. This requirement adds about an additional 30 days before a notice of default can be filed. From the notice of default date, there is a 90 day period at the end of which is a twenty-one day advertising period. Only after this advertising of the pending foreclosure, can the actual sale or transfer of deed occur.
So with all this time, why do we still hear ‘evil lender' stories? Perhaps one reason is that many San Diego homeowners owe more than their homes are worth. They are under the misconception that they can give the deed back to the lender, avoid foreclosure and perhaps receive a less severe credit rating ding. The problem arises when there are junior liens on the property. These junior liens can be anything from an equity line to a personal loan secured by the home.
A lender may not want to take a deed in lieu of foreclosure because taking title in this manner does not extinguish any junior liens. However, a foreclosure by a senior lien holder essentially wipes out all junior liens.
Also, a borrower cannot simply transfer title to the lender without the lender's permission. Because some lenders have refused to negotiate and accept the deed in lieu of foreclosure, some creative homeowners have quitclaimed the property to the lender anyway, and have recorded the instrument without the lender's permission.
In 1993, the California legislature passed a statute to protect lenders from involuntary (and invalid) transfers of real property to the lender. The lender must record a "notice of nonacceptance of a recorded deed" in the county where the real property is located. Redelivering a grant of the real property back to the original homeowner (e.g., borrower) does not legally retransfer the title. (Cal. Civ. Code § 1058.5.)
California Home Foreclosure Filings fall 32%
San Diego Real Esate Sales Increase
San Diego Condominium Sales Price Appreciation
#1 Key To Purchasing Real Estate in the San Diego Market
San Diego California Home Sellers Lose Big
The San Diego California Real Estate Great Depression
1.2 Million Homes in Foreclosure
Survey Says Home Values Must Fall Another 14%
A Record Number of Homeowners Avoid Foreclosure in the Second Quarter
Jumbo Financing and the Impact on The San Diego Real Estate Market
san diego residential real estate
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Emergency Rescue Package – The Devil’s in The Details
Is this a mess or what?
You live in a San Diego new housing development where all homes were sold out in 2004. You and your neighbor paid $750,000 for your identical homes. You have been paying your mortgage on time, but your neighbor is facing foreclosure. As we all know, most San Diego home values are way down from their 2005 highs. So, let's say the homes in this example are now worth $525,000 each. What happens when your neighbor gets his loan modified to $525,000 simply because he can’t afford his house?
Actual clause in the government rescue package:
Sec. 109. Foreclosure Mitigation Efforts
CONSENT TO REASONABLE LOAN MODIFICATION REQUESTS – Upon any request arising under existing investment contracts, the Secretary shall consent, where appropriate, and considering net present value to the tax-payer, to reasonable requests for loss mitigation measures including term extensions, rate reductions, principal write downs, increases in proportion of loans within a trust or other structure allowed to be modified, or removal of other limitation on modifications.
Also, be sure to read these related posts:
Are the Rating Agencies at The Cause of Our Financial Mess?
Housing Bailout – The Real Cause?
The Paulson Plan – Still Wrong
Government Bail-Out – Risk & Reward
Housing Bail-Out … Pass or Depression
San Diego California Home Sellers Lose Big
MDA DataQuick .. Real estate research firm reported about two-thirds of property owners who sold homes in San Diego County this summer lost money. The average loss was $161,000, or 35.5% less than the home had sold for previously.
DataQuick's report also said of the 4,318 homes sold between June 22-Aug. 22… 2,624 or 62.7% were sold at a loss. Many of the sales were foreclosures. Losses on foreclosures running 39% off the previous sale price, compared with a 27% loss for nonforeclosures.
In some San Diego zip codes, foreclosures amounted to nearly 90% of all sales. Many of the other sales were short sales. San Diego CA real estate agents
San Diego County Foreclosures up 125% from 2007
According to a report today from RealtyTrac, an Irvine, Calif., company that tracks foreclosures, apprx. 2,200 homes in San Diego county were seized by banks, while an additional 3,000 homes received notices of default, the first step in the foreclosure process. The number of foreclosures are 2 percent lower than June's foreclosures, but, 125 percent above levels a year ago. San Diego Realtors
San Diego City Attorney Wants City To Be Foreclosure Sanctuary
San Diego City Attorney Michael Aguirre, today, filed a lawsuit against Bank of America Corp and its Countrywide unit to prevent the mortgage lenders from foreclosing on homes in his city, which he wants to make into a "foreclosure sanctuary."
Attorney Aguirre said: "The Countrywide executives who originated these subprime loans were engaged in a massive fraud on homeowners, borrowers and investors, They enriched themselves by over $1 billion."