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Mortgage Scam Alert

May 22nd, 2009 9:42 AM

Mortgage Scam Alert

Reported by Bottom Line "The World's Best Inside Information"

The Bottom Line Personal newsletter has reported on a disturbing trend affecting troubled homeowners. Scammers, misrepresenting themselves as "loss-mitigation specialists," are preying on these consumers.

According to Henry Sommer, Esq., a Philadelphia attorney and president of the National Association of Consumer Bankruptcy Attorneys, these thieves "charge upfront fees of as much as several thousand dollars" and claim that they can help get modified loans for people that are having trouble paying their mortgages.

Once the victim pays they may never see their money or their "loss-mitigation specialist" again. Unwittingly they may have also hastened their own bankruptcy or foreclosure with a loss of much needed personal funds at a critical time in their lives.

The Homeowner Affordability and Stability Plan, announced by President Obama earlier this year in February, was crafted to provide relief for these homeowners. It provides $75 billion to help families prevent foreclosure and stabilize hard-hit communities.

The Plan includes a loan modification program which provides incentives for lenders to modify the loans of borrowers who are at risk of foreclosure if their incomes are not sufficient to make their mortgage payments. It also includes refinance opportunities for borrowers who are current on their mortgage payments but have been unable to refinance because their homes have decreased in value.

Bottom Line offers a self-defense tactic to stop these "cheats" and the havoc they may wreck on unsuspecting homeowners. Nonprofit housing agencies, approved by the Department of Housing and Urban Development (HUD), provide free housing counseling. On their website, HUD lists 15 approved agencies in the St. Louis metropolitan area alone. Troubled homeowners can easily get the help they need from one of these trusted sources.

HUD Approved Counseling Agencies in Missouri: Approved Agencies

Up-to-date information on the Making Home Affordable program: Affordable Home

Posted by Customer Service on May 22nd, 2009 9:42 AMPost a Comment (0)

It's Real Estate Season - Or is it?

May 22nd, 2009 9:43 AM

It's Real Estate Season - Or is it?

Reported by Steve McLinden, Bankrate.com

Editor Steve McLinden's recent online story at Bankrate.com reports about one of the most important traditions of the year for the real estate market; the Home Selling Season. "It's a rite of spring and early summer in our transient society," stated McLinden. From coast to coast, for-sale signs crop up like wildflowers on the lawns of subdivisions. Moving sales proliferate. Moms and dads box up their possessions and ponder what awaits them on a new block or in a new town. Kids finish out semesters. Moving to a new home is an exciting proposition.

It's a time when real estate salespeople get lightheaded from make-hay fever, as buyers and sellers come out in full bloom.

But is it always the best time to buy or sell a house?

That's a definite maybe, say experts. Like most buy-sell situations, it all depends on motivations. Indeed, April through July outpace the balance of the year in sales, historic data at the National Association of Realtors indicates. So there will surely be more home inventory and variety then. But you better move fast, because that's just what other home hunters are doing.

Here's a few tips that the experts say you should consider in preparation for this peak selling season.

Be a contrarian. True, there's a greater choice of homes in the early spring, but sellers then can better hold to their asking prices because of demand. "If you can stand to be a contrarian, it could pay to wait," says Jack Harris of the Texas A&M University Real Estate Center. "Most people don't do that, though. They just get carried along with the crowd."

Late Summer Leverage: Sometimes, late summer opens a small window of leverage for buyers dealing with sellers of slow-moving family homes.

The sooner, the better: While deed transfers do peak between May and August, most of those sales were actually arranged from one to three months earlier. Getting your home on the market sooner is better than later. It takes time to close home transactions.

Holding out: Your wait could be a long one. A home priced unreasonably high can be hard to sell in any season, particularly in a buyer's market. Industry stats show homes with price tags 5 percent above market value have a 10 times greater chance of selling than those priced 15 percent above market.

Opportunism: While it may sound ghoulish, layoff announcements or a planned corporate headquarters move in some markets can soon result in more homes on the market. Motivated sellers may put downward pressure on prices in the short term. Proceed with sensitivity.

Link: The Season

Posted by Customer Service on May 22nd, 2009 9:43 AMPost a Comment (0)

Get Ready for a Home Inspection

May 22nd, 2009 9:02 AM

Get Ready for a Home Inspection

St. Louis - On May 1st the new Fannie Mae/Freddie Mac Home Valuation Code of Conduct (HVCC) rules became effective for appraisers and lenders. The HVCC is a great step forward in establishing guidelines to allow the inspector to establish an accurate value of a property that lenders, buyers and sellers can trust. But there is more home owners can do to ensure their home receives a favorable evaluation.

Preparing the home for inspection is a critical step in the selling process. Owners not only have the opportunity to present their property in its best condition, but also to help prevent closing delays due to incomplete or repeated inspections. Once the appraisal process is completed, they are one crucial step closer to purchasing that new home when their home closes.

Here are the major points to consider in preparing a home for inspection:

Clean the house - It seems like a trivial thing, but an unkempt house gives the impression of uncaring owners and neglected regular maintenance. Owners should clean everything and make any necessary repairs well ahead of the inspection date.

Be on time to meet the inspector - Your inspector will be on time, and may even arrive early to start their exterior review of the property. Owners should schedule their property to be available a minimum of one-half hour before the set appointment time.

Keep utilities connected - Unoccupied or not, be sure all utilities are connected and all electrical and gas appliances are ready to run. For liability reasons, many inspectors will not ignite gas pilot lights in hot water heaters, stoves or furnaces. If they are not working an incomplete inspection is the result. Additional delays will ensue. Heating and cooling systems, plumbing, appliances, faucets, and electrical systems will all be tested and must be in good working order.

Provide access - Inspectors will need access to the basement and attic as well as all outbuildings and electrical boxes. The keys for garages and sheds must be made available. Make sure shrubbery doesn't impede access to sprinkler systems or the home's foundation.

Provide repair documents - Owners should collect all receipts and repair invoices for anything they have fixed in the home. This shows proof of upkeep and answers many questions an inspector may have.

Remove your pets and yourself - An inspection may take as long as three hours to complete. Owners must plan to leave their property and bring children, pets and other home occupants with them. Inspectors are often accompanied by buyers, and both will want uninhibited, free access to ask questions and explore the home.

Additional Link: Get Ready

Posted by Customer Service on May 22nd, 2009 9:02 AMPost a Comment (0)

New Appraisal Rules Effective May 1st

May 1st, 2009 9:29 AM

New Appraisal Rules Effective May 1st

The rules are changing in the residential mortgage market for lenders and appraisers. The Fannie Mae/Freddie Mac Home Valuation Code of Conduct (HVCC), otherwise known as the "Code," will become effective on May 1, 2009. It will affect all lenders, correspondent lenders, and servicers selling loans to Fannie Mae and Freddie Mac.

These government-sponsored enterprises hold or guarantee some $1.5 trillion in mortgages. After the Code goes into effect, both have agreed to purchase only loans by residential lenders who verify the independence of those that appraise their property.

The agreements are in response to pressure by New York Attorney General Andrew Cuomo as part of a yearlong investigation of alleged fraudulent home appraisals ordered by lenders, brokers and their sellers. Some housing experts blame inflated or false residential appraisals, among other excesses, for causing or worsening the housing and mortgage industry crisis.

The Code will require strict adherence to a code of conduct designed to eliminate fraud and produce more accurate values for homes on the market.

Some of the major points in the code of conduct include:

Required use of the Market Conditions Addendum (Fannie Mae form 1004MC/Freddie Mac form 71) - Appraisers must report on the primary indicators of market condition for properties in the subject neighborhood by noting the trend of property values (increasing, stable, or declining) plus other key market factors.
Appraiser independence safeguards - An expected appraised home value cannot be conveyed to the appraiser.
Requirements that the borrower receive a copy of the appraisal - A "copy" must be made available prior to a three day period before closing, unless waived.
Appraiser engagement restrictions - Prohibits lenders from accepting appraisal reports completed by an appraiser selected, retained or compensated in any manner by a real estate agent or other third party.
Prohibitions against improper influences on appraisers - Employees in the sales or loan production functions of the lender can have no involvement in the operations of the appraisal functions and play no role in selecting, retaining, recommending, or influencing the selection of any appraiser.
Appraisal audit requirements - Quality control must be implemented.
Independent Valuation Protection Institute (IVPI) - This portion of the code is invalid until the IVPI is in full operation.

The Code does not apply to loans that are insured or guaranteed by a federal agency, such as FHA and VA loans at this time. However, this could change in the near future. There is no geographic limitation for application of the Code. Appraisers must be certified by the state in which the property is located.

For more information check out the FAQs here.
Link:New Rules

Posted by Customer Service on May 1st, 2009 9:29 AMPost a Comment (0)

Bill targets bad mortgage brokers

May 1st, 2009 9:26 AM

Bill targets bad mortgage brokers

St. Louis - Protecting borrowers from unscrupulous lenders and shady brokers is the focus of a bill passed by the Missouri state legislature this week and headed to the governor's desk to be signed into law.

Cleaning up the mortgage industry has been the focus of federal and state lawmakers since last year when President Bush signed the Housing and Economic Recovery Act of 2008 on July 30, 2008. Among the provisions of the bill is the enactment of the Secure and Fair Enforcement ("S.A.F.E.") Mortgage Licensing Act.

States were mandated to adopt the federal guidelines into their own licensing and registration systems to be put in place by July 31, 2009. Missouri's version of the bill, HCS HB 382, follows the Model State Law developed as part of the federal legislation.

This law is designed to enhance consumer protection and reduce fraud by establishing a uniform minimum standard for the licensing and registration of mortgage loan originators. The new measure mandates all brokers and bank lenders submit their names to a new federal registry.

How do these new regulations help consumers?

Reporter Megan Lynch of 1120 KMOX News Radio went right to source to find out in her on-air interview with Paramount Mortgage Company President, H. John Frank, Jr. Currently there is no way to track loans, "and so if you're in Missouri and you make, say 100 loans, and 50 of them go bad, today you can go to a different state and get a new license and then you're a fresh new loan officer" offered Frank.

With the expected passage of the new law, "that means officials could track the loans of any mortgage professional in Missouri" continued Frank. The proposal also requires mortgage brokers to be bonded, to submit to background checks, and to participate in continuing education. These safeguards will prevent mortgage brokers who have been previously found guilty of mortgage fraud from doing business. Frank told KMOX these measures should help to clean-up the industry.

KMOX Interview: Mortgage Bill

Posted by Customer Service on May 1st, 2009 9:26 AMPost a Comment (0)