The Collected Works of Author and Blogger Larry Roberts

Archive for March, 2013

Last year I pointed out that loan modifications are not an entitlement, banks don’t want to make them one. That's not how borrowers see it. One of the moral hazard consequences of the housing bubble is a belief among borrowers that if they get in trouble, they will be given an opportunity to reduce their mortgage payments and stay in their homes because that's what happened over the last six years. However, the only reason borrowers were given special dispensation is because the banks were desperate and had no other viable alternatives. From Must-sell shadow inventory has morphed into can’t-sell cloud inventory: The necessity of loan modifications Ostensibly, loanowners and lenders agreed to the price of money (interest rate and…[READ MORE]

With house prices bottoming, lenders are less risk adverse because they know rising prices reduces losses when loans go bad. As a result, lending standards will soon begin to loosen up on the fringes as lenders will take on marginal borrowers in an attempt to underwrite more loans. This is a natural part of the credit cycle, and fortunately with new regulations in place governing qualified mortgages, the cycle of loosening standards should not go so far as to inflate another disatrous housing bubble. But that doesn't stop lenders from trying. Many in the lending industry think their work is like science that continually advances. It is not. It is far more akin to assembly line work where the same…[READ MORE]

Shevy Akason recently was a guest on Nelson Radio's show. Enjoy. Contact Akason Realty Consulting [email protected] 949.769.1599 Name * Email * Phone * Thank you for your interest in Akason Realty Consulting Akason Realty Consulting performs the following services: (1) provide real estate instruction and evaluation; (2) supply unique property valuation reports to our clients; and (3) facilitate real estate sales without pressure, manipulation, or emotional appeals. If you want to fully understand what makes us different, read Urgency Versus Reality: realtors Win, Buyers Lose. Shevy Akason Evergreen Realty - The ARC Group [email protected] Lic. 01836707 Credentials: Bachelor of Arts - Claremont Mckenna College 2003 Real Estate investor since 2004 Academic All American - NDSCS 2001 Associates Degree - NDSCS-…[READ MORE]

The increase of home values have pushed some 1.4 million underwater borrowers into positive equity territory.  The Federal Reserve have engineered ultra low mortgage rates and banks have suppressed the shadow inventory into "cloud inventory'"   Meaning many homeowners will receive loan modification after loan modification leading to a false sense of confidence,  but in the long term most will end up losing their homes. However, for these newly above water borrowers threats still remain to push them underwater again.  Whether its market risk,  balloon payment shock, mortgage rate increases,  tax law changes or even demographic changes in their neighborhood it's probably on their mind that they could be upside down again.  Therefore, some of these borrowers are contemplating selling…[READ MORE]

The big national banks entered into a settlement agreement with attorneys general across the country early last year. Under the terms of the settlement, banks were allowed to count losses from short sales toward meeting their payment goals, but foreclosure losses did not count. Therefore, the banks radically changed their policies and started approving short sales and stopped pursuing foreclosures. As a result, short sale activity increased, which cleared many languishing deals from the MLS, and the banks stopped processing REO which further reduced the MLS inventory. Whether by design or by accident, the dramatic decrease in MLS inventory caused the housing market to bottom early last year. This created one big problem for the banks: squatters. People who complete…[READ MORE]

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