DEAR ROBIN – HOW CAN THE LAWYERS HELP ME NOW?    

Dear Robin,

   I wish that attorney could just walk into a court room and demand the judge give me a free house based on the violations and all the other dirty stuff the lender did to me when I was so dumb and eager to buy that house in Vegas that I couldn’t afford but hell the market was so aggressive I was counting on that equity surge or bubble or whatever they call it to cushion me should anything go wrong with my job or my health as it were.    Now the equity has gone with the wind and the only cushion I have left is some black macadam, fireplugs and streetlights.  

   Can somebody please help me now that I’m underwater $200,000 on what I believed would be my Ancestral Home where I could raise my children and my children’s children.  Damn I should have stayed down on the in Kentucky farm like my Mama told me.  I mean I thought I could get a free house but everybody is saying no way.  

Robin I really need help, please what can I do?  

                            Yours truly, Jake Jones    

  Dear Jake, I’m sorry to hear you are down and out, but I assure you that you are not alone.  Unfortunately the free house thing is not available to most of us since the courts aren’t going for it no matter how much fraud the lender may have committed on you when he sold you that home and the banks are as bad natured as snakes in a barrel and don’t normally go about giving free houses to people if they can’t help it.  

   What you got to do is find a mouth piece looking to present something that is fair and reasonable to the court in an effort to satisfy your needs as a homeowner.   That “Show Me the Note” strategy, well that doesn’t really work so well as a permanent solution – at best it will only serve to slow the Foreclosure Process down since that bank will pull a note out of its sleeve sooner or later, and the judge, well he don’t really care if that note is bogus or not because he probably went to school with that banker or knows one of his cousins.  

   When you get your matter up into a mediation or court you need yourself an attorney that knows how to use strategy that proves the straw-lender or lawyer talking to the judge on behalf of a lender or a bank has no knowledge or connection to the real lien holder.  They need to be exposed as a pretend lender. 

    Anybody who is posing as a representative of a property should be challenged to prove it.  If the attorney makes a demand for proof and presents facts that are counter to what the bank representative is claiming to possess it opens a door that encourages the court to move for discovery and an evidentiary hearing which allows an opportunity for justice, and that’s what your after Jake, justice.   

  Your gonna get these so called representatives of the banks thatflex their muscles and try and take control of the situation when if fact they have no real knowledge of the loan or whom they are representing – they’re just hired guns Jake. 

  This hired gun usually is not sworn in as a legal witness and if challenged and proven as making false representations then the defending attorney has the opportunity to convince the judge to allow discovery.  Once you have obtained that position in the court you have the pretender lender trapped like a rat in a cage because their representation was nothing but a lie to begin with. 

   The attorney’s goal in a case between homeowner and lender should be to find out who the real creditor is, re-underwrite all documents pertaining to the loan and to make sure the loan was made in good-faith without predatory intentions or fraud.  A Forensic Audit should be performed on all documents pertaining to the transaction so when discovery is presented your attorney has a hand to play.  If you get the upper hand on the bank by finding out they did commit some hanky panky then your attorney can fight for what’s right for you and yours.     

  I wish you good luck Jake and God’s Speed.  

    Robin Basichis – President CBC Property Solutions Inc.

Treasury sets new rules for Short Sales process

The Treasury has a new set of rules for Short Sales.  Under the new rules, which will go into effect April 5th 2010, the Short Sale Process will be simplified and give the homeowner some protection from the bank foreclosing on the property before the property has been sold. 

These new changes will allow the Short Sale to start before a purchase contract offer has been created.  The idea is to create a time-line that is fair for the homeowner and their agent to find a buyer and sell the property.  

The law says that Foreclosures can be initiated during the Short Sale period but the banks should not sell the property at Sheriff Sale while the Short Sale is in process.  The new law should help to protect the homeowner and the Broker’s commission – disallowing the banks to slice and dice on the co-ops. 

THE NEW TREASUREY SHORT SALE CRIETERIA 

• The property must be Owner Occupied.             
• The homeowner will not qualify for a Loan Modification or have the capability to refinance.
• The loan on the property had to taken before January 1, 2009 and be in arrears or at risk of being in arrears in the opinion of the lender.
• The homeowners total housing expenses exceeds over 31% of borrowers total monthly income.
• Loan amount can not exceed over $729,750.00
• Borrowers would be entitled to $1,500.00 for relocation costs upon vacating the property in a clean condition.
• The Loan Service Company would be entitled to $1,000.00 for agreement to the Short Sale or deed-in-lieu.
• Lenders would be entitled to $1,000.00 for the agreement to the Short Sale or deed-in-lieu.
• Second Lien holders would be entitled up to $3,000.00 for Short Sale or Deed-in-lieu approval.  

This is the government’s way of giving everyone a little slice of the pie in the hope they will walk away quietly.  

The law demands the Lender waive their rights to any deficiencies judgments and release the deed promptly upon completion of the sale.

NEIGHBORHOOD STABILIZATION ACT OF 2008 

  The Neighborhood Stabilization Act has allowed HUD to hand over $7.5 Billion in Grants and $7.5 Billion in no-interest loans to States for the purposes of purchasing rehabilitating – selling and renting properties that are abandoned, vacant and foreclosed.

This piece of legislation allocates funds based on the percentage of foreclosures in a State during the last four calendar quarters and the number of sub-prime loans that have gone delinquent in a state for more that 90 days.  The City of Las Vegas is a prime target for this plan since we have more delinquent and abandoned homes in out City that are sitting in the hot sun drying up than just about anybody else in this country. 

 The State of Nevada must submit a financial plan to HUD on how it is going to grab all the REO’S Foreclosed and Abandoned houses in Las Vegas. The properties the city purchases under the act will be sold to families with income below 140% of the local median income.  Housing purchased for rental will be made available to families whose incomes are less than or equal to the local median income.  What we have here is Public Housing for poor people.   When the properties regain their equity sometime in the distant future the federal government is allowed to grab 50% of any appreciation that a property owner gains from resale. The Government is now the poor man’s partner.  

HOW DOES THIS IMPACT NEIGHBORHOODS?

Areas in Clark County, like most Counties, have variations in demographics and stats.  There are neighborhoods that have a higher amount of income per-household, or a half a child more per family, and like everywhere else some neighborhoods just look prettier than others.  In the overall the majority of Las Vegas neighborhoods fall into the category of Blue and White Collar Middle Class

Now there has been a breakdown in several Las Vegas communities resulting from the housing crisis which left scores of vacant and foreclosed homes in its wake.  Foreclosures have caused property values to plummet.

  People who have chosen to stay in their homes are seeing the properties in their neighborhoods losing equity at a rapid pace as foreclosures continue to remain the current fad.  Because no one is living in the abandoned properties taxes are not being paid and the local tax base is eroding.  We can barely keep our schools open and the Governor would like to have us eating out of garbage cans while he bangs around cocktail waitresses in parking garages.  Gibbons would be more than happy to let us live life without basic necessities like plumbing and electric if he could get away with it.

The Center for Responsible Lending says approximately 40.6 million homes nationally will experience devaluation because of  sub- prime foreclosures and that homeowners living near foreclosed properties will lose on average $5,000 on the value of their homes.  In Las Vegas it’s more like a couple of hundred thousand in lost equity. 

The days when you could get a good deal on a bank-owned home have fallen to the waste side in Vegas.  The City of Las Vegas has first dibs on REO’S and foreclosed properties now because of The Neighborhood Stabilization Act.  The City will either sell these homes off cheaply to the underprivileged below market value or rent them out Section 8 style where the renter only makes a token payment and the City picks up the rest of the tab.  Not such a bad business plan when you have billions of dollars to float.  Let the renters stay there for awhile until the equity comes back – when the equity comes back tell the renter they have to go and sell the property on the open market back to the consumer.  Again, the underprivileged buyers have to share 50% of their equity with the City when they sell their homes – so the house wins no matter what.  Well, hey this is Vegas and the House always wins.   A few years down the road a person may wind up buying back the same property they lost to foreclosure at a price they can at last afford. the House wins again.

Regular homebuyers should be picking up these REO’S not the City.  People who are upside down in equity should be getting help from the government and not foreclosed upon if they can afford to make a monthly mortgage payment that reflects market value.  

In the name of public welfare the Government is creating a false economy that will collapse just like the last one, and in the end they will scrape up all the cream off the table once again and sell it back to us.                                    

                                   POWER TO THE PEOPLE.   

 

The banks are still hesitant to make loans to homeowners.  They just don’t want the risk.  They took the risk and look where it got them. Lenders are now looking for new metrics, actuary tables and analytics to protect them from getting stuck with bad loans.   

What you needed to buy a house a couple of years ago were a good credit score, proof of funds and an appraisal.  New regulations are coming that will expand the entire criteria spectrum.  What lenders are now looking for is what is called “Future Trending”  

To gather data for Future Trending you need history on the borrowers FICO score.  Instead of accepting your current score they want to go back in your History and see what you’ve been doing before – well who knows how far back they are going to go.  Better hope you paid for those breadsticks and milk cartons in Kindergarten.  

To achieve proper Future Trending Profiling geographical areas will have to be accessed.  Where you live will make a difference whether you get that house or wind up in a cold-water flat.  The strength or weakness of the economy in your neighborhood will be a determining factor in the Future Trending Analysis. Good luck if you live in a place like Detroit. 

The banks will have no choice but to take into consideration how stable your job may be.  How is it now?  What was it like in the past?  How does the future look?  Do you have a history of climbing the ladder of success or are you one of those who hide their ass behind the water cooler? 

They want to know. They want to know now.  They want to know if the industry you are working in and thriving in today will be a viable industry tomorrow.  If they determine that it’s not, well somebody else just might get that house you were dreaming about.   

Isn’t it tough enough to get a loan right now?  As the banks become more and more risks adverse and throw up all this new criteria how many people will actually qualify for a loan?   And how are the lenders going collect and sift through all of this data?  Will they use more tax money?  Will they use your money to turn the screws on you?  

Let’s say you get all of this data, compile it and do the market research. You then come up with and employ this risk advers model that is supposed to hedge the bets.  You have computers humming and the best predictive analytics ever devised by man.  Now somebody gets sick.  Somebody gets divorced.  Somebody goes nuts.  How can any system or model ever predict what is going to happen in someone’s life.  A safer bet and a more accurate prediction can be done on the value of a property.  The banks are better off hedging their bets off of LTV than they are on the next turn someone might take on the highway of life.

THIS NEW INNOVATIVE HOME HAS BEEN OFFERED TO THE CONVENTION  

The International Builders Show at the Las Vegas Convention Center will not feature The New American Home, a sample home that showcases state-of-the-art home-building concepts, materials and construction techniques that eventually find their way into production homes across the nation.

For the last twenty odd years the show has had a sample home on the floor built with new innovations for the eye to see and the hand to touch.  Unfortunately the company building the sample home for the trade show ran into money problems with their lender and the funding had to be withdrawn. 

Confidence is not instilled when a company can’t come up with the money for one Sample Home to be placed on the floor of a trade show.  Builders are in trouble and nobody knows what lies ahead in the near or distant future of new home construction.

New home sales have to compete with foreclosures in a place like Las Vegas. REO’s and foreclosures are not going away anytime soon because the banks are holding onto their inventory. The banks know if they dump the bulk of their inventory on the market all at once it will depress the market even further.  The banks are releasing homes in drips and drabs to satisfy some of the current homebuyers looking for a discount.  These discounts will continue to interfere with the Sales and Marketing of New Homes which is the second most important industry in Las Vegas next to Gaming.

This town came to light from the construction boom. Now the lights are out.  How long will it take for all the abandoned properties to get back in the hands of homeowners?  How long can the town wait?  New Home construction and existing home sales creates jobs.  There aren’t a whole lot Real Estate and construction jobs being created right now.  What’s the answer?

The decline in housing values and home equity affects people differently than other investments.  The average person who invests in stock or bonds and other securities look at those things from a different vantage than an investment in a home.  Most people feel their biggest investment is their home and housing values, not stocks or bonds, help define a person’s sense of financial stability as well as their perception of wealth, soical status, etc.  The right to pull equity out of the home changed the life styles of many.  The average person could now live on a much higher economic level than they experienced before.  Whether it was right or wrong or fiscally irresponsible for homeowners to pull so much equity in such a short period of time is certainly arguable, but at this point the argument becomes merely academic.  It happened, and now so many are underwater – economically speaking.

The sudden rise in housing values made lots of Americans feel rich. Suddenly the have nots had something.  People went out spent and invested that money. A lot of the investments went into more properties. The whole idea was to ride the wave of the boom and cash out on the crest – problem was most people never saw the crest and when the wave collapsed it was too late. Prices fell along with people’s psychological sense of wealth and financial well being.

 People who once had equity are now left with debts and deficits.  It may take years for many to recover not only financially but psychologically.  Scores of depressed housing prices can create scores of depressed people. Many folks cashed their retirement funds to chase the craze. How long are they going to have to work before they can retire?  I guess for many it’s a question of how long are you going to live.

Mers was orginally set up by the lending industry to manage documents like mortgages and liens that would normally be filed publicly by the lending institution with the County Recorder’s Office.  Instead of the lender doing the filing with the County Recorder MER’S creates a onetime filing with the Recorder’s Office.  After MER’S does the onetime recording the MERS’ system does an internal monitoring when a deed is transferred from one party to another and the name MRES shows up on the Note and Deed recording instead of the real owner of the security. 

Over half of all new home loan securities in North America are registered with MERS and recorded in county recording offices in MERS’ name. What MER’S has created is a lack of transparency in the mortgage market in two ways.

 First, consumers and their counsel can no longer turn to the County Recorder’s Office to find out who is holding on to note and deed.  Now when you begin to research a property to find chain of title, etc, often what you see registered as holder of the note is MERS, and the real owner of the note is conveniently veiled through use of the MERS instrument. 

Right now MERS is foreclosing on properties all over the United States by using its name as owner of record even though it is really not the actual lien holder.  In reality MER’S is still just a document management company acting like an owner.

MERS may get the real owner’s permission to act on its behalf or MERS is acting as an agent of the owner but the process creates some real problems. 

MERS has not set up a system nor does it care to set up a system to respond to consumers or legal professionals when requests are made for discovery of evidence in regards to things like predatory lending claims and RESPA violations. 

What MERS is set up to do is act as a shill for whoever owns the note and deed and foreclose on a home as quickly as possible without giving up any information.  They are like a Phantom that cannot be contacted.  This posture allows them to block the consumer and their agents from finding out about acts of predatory origination and RESPA violations.

While up against the wall of foreclosure, consumers that try to assert predatory lending defenses are often forced to join the party – usually an investment trust – that actually will benefit from the foreclosure. As a simple matter of logistics this can be difficult, since the investment trust is even more faceless and seemingly innocent than MERS itself. The investment trust has no customer service personnel and has probably not even retained counsel. Inquiries to the trustee – if it can be identified – are typically referred to the servicer, who will then direct counsel back to MERS. This pattern of non-response gives the securitization conduit significant leverage in forcing consumers out of their homes. The prospect of waging a protracted discovery battle with all of these well funded parties in hopes of uncovering evidence of predatory lending can be too daunting even for those victims who know such evidence exists. So imposing is this opaque corporate wall, that in a “vast” number of foreclosures, MERS actually succeeds in foreclosing without producing the original note – the legal sine qua non of foreclosure – much less documentation that could support predatory lending defenses. (Timothymccandless’s Weblog)

 

THIS HAPPENED SOMEWHERE IN PHOENIX  

An Arizona Couple who were current on their loan agreement were foreclosed on by Chase Bank.  The couple found out about the foreclosure when the owner of the property pasted a five-day vacates notice on their door. 

They called the number on the vacate notice and the party on the other end claimed to be the owners of their property.  They thought they were safe when they cut a deal for a loan restructure with the bank.  The thought they were safe as they paid on the agreement long enough to make them eligible to step out of a trial modification and qualify for a permanent fixed loan thirty year loan.  But that didn’t happen.   

Chase has admitted to the media that they made an error by selling the house.

In a public statement to a local news agency they said, “We apologize for the confusion over the modification actions and the parallel foreclosure steps Chase takes as a precaution. We have reached out to homeowners to discuss where we go from here.” 

Was this a case of communication breakdown? By sending the money to the bank on time should be enough consideration and communication for any individual or institution.  If Chase had to go public in order to do damage control on this incident it probably was not in their best interest to foreclose on the property.  It certainly would not be wise for Chase to lose the public trust. So what happened?   

Chase has the power to buy the house back or rescind the sale.  I am waiting to see what happens.  

I guess the best practice for people who are working with banks to save their homes should call at least once a week to keep tabs on their status otherwise you could wind up with and orange sticker on the door. 

 

 

 

CALL ROBIN BASICHIS – 702-279-8025   

If were to combine mortgage delinquencies with foreclosures as of today you would come up with a 14.50% national total.  This is the highest percentage total on record in.

Nevada, Florida and Arizona make up 43% of the national total.
Things are likely got get worse before they get better. Stuff like jobs and employment have to come back. Hopefully jobs will start coming back to Las Vegas. 

Didn’t the current administration say it was going to help homeowners who were in trouble?  What happened to the $50 billion dollars worth of TARP money that was supposed to be earmarked for the Housing Affordability Stability Play (HASP)?

This plan promised to help between 3 to 4 million homeowners.  What happened? What happened to all the campaign spiels that led all the way up to Obama’s inauguration where he promised Bruce Springsteen and James Taylor that he was going to help at least  9 million homeowners?

So now what? More defaults – more foreclosures? I guess so. Things won’t start to turn around until we see new jobs being created. We need to expand and improve commerce in Las Vegas.  We need to somehow stabilize the declining real estate market in order to survive this downturn. I do not believe the government is going to help solve our problems. It is up to us to work together through our businesses and communities and make a full fledged effort to pull ourselves out of this mess. There is strength in numbers and together we can do it.   

If you life in Las Vegas or anywhere in the country and you are having problems keeping your home – call me.  If you are facing foreclosure call me.  If you have an investment property that you are upside down on and it’s bleeding you – please call me. 

Call Robin Basichis -  and I will try and help you any way I can.  “I’m mad and I’m angry and I’m not going to take it anymore.” 

PLEASE CHECK ME OUT ON FACEBOOK

The Federal Housing Administration, more commonly known as FHA is the insurer of about $750 billion in outstanding mortgages. A HUD Audit on FHA found their cash reserve fund is rapidly depleting and may drop below its Congressionally mandated 2% of insurance liabilities by the end of the year.

At a 50 to 1 leverage ratio, the FHA will soon have a smaller capital cushion than did investment bank Bear Stearns on the eve of its crash. FHA is now dealing with a 14% thirty day or more late rate. This is three times more than conventional mortgages.  FHA’S cash reserve ration has fallen over two-thirds in the last three years

Why is this happening to FHA? They are the only one’s taking on sticky loans. Conventional Banks will not loan without a substantial down-payment and a stellar credit score.  FHA has now placed itself in the position that the secondary lenders were in a couple of years back. Too bad they can’t dump their portfolios onto the stock market like the sub-prime lenders did.  At least when the smoke clears somebody walks away with a trunk full of cash and there’s a good story to tell.  This won’t happen with FHA.  If they go under the tax payer is going to have to pick up the bill. 

Out of every four loans currently being written FHA is writing one. Back in 2006 the ratio was 50 to 1.  FHA is gambling with public money. If property values continue to decline then we can wave bye-bye to FHA