There has been an upsurge recently in banks offering cold, hard cash to homeowners if they sell via shortsale.  As homeowners learn how to fight foreclosures, the banks are finding it saves money to just belly up to the bar and offer cash to sell.  From CNN Money,

And as the cases drag, expenses grow. Homeowners not only stop paying their mortgages but they stop paying property taxes and conducting normal maintenance as well. Roofs, siding, plumbing and other parts of the home deteriorate and the property loses value. By the time banks take possession, they’re out tens of thousands of dollars.

If my bank called today to make the offer, I’d first be suspicious but – if it was a real offer – I’d take the money and run!

An interesting phenomenon is popping up across the country – homes being used as billboards.  For families facing foreclosure, the billboards could be what saves their houses, even though the neighbors may not exactly love the bright paint.  From MSNBC,

In return for allowing the front of their four-bedroom house to become a garish advertisement, the Hostetlers are getting their nearly $2,000 monthly mortgage paid by the marketing company behind the project, Brainiacs From Mars.

In a residential neighborhood without heavy traffic, cars passing by the house slowed and drivers gawked at the vivid colors and a giant Brainiacs From Mars billboard.

I would volunteer my own house but we’re too far out in the country!

While the majority of people who are upside-down on their homes, behind on their mortgage payments, or who’ve lost their homes will not benefit from the massive settlement, some will be helped.

Today 49 states and federal officials settled with some of the nation’s biggest banks to the tune of $25 billion.  However we are still in the dark about whether you, me, and our neighbors will be helped.  According to MSNBC,

The settlement largely affects borrowers whose loans are serviced by five big banks: Bank of America, Citi, JPMorgan Chase, Wells Fargo, and Ally/GMAC. Loans owned by government-owned mortgage giants Fannie Mae and Freddie Mac are not affected. Borrowers from Oklahoma also will not be eligible because officials from that state did not join the settlement.

There are a lot of people in this nation tonight crossing their fingers that relief is coming. Unfortunately it will take many nights of crossed fingers before they get their answer.

New mortgage lending policies are now being developed to classify mortgages and set the standards on who qualifies.  While the intent is to develop rules “in the spirit” of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, what essentially happens is it becomes even more difficult for regular people to qualify for a home loan.  From Real Trends,

However, the lower default rates, moving from QM to QRM come at a cost—the number of potential borrowers who would be excluded from the market. This is where real estate professionals and their customers really get whacked.

Items of concern include the elimination of 8.55 million qualified loans of the 19 million analyzed.   Also excluded are minorities and low income buyers, “Even at a 3% down payment, 25% of low-income buyers would be excluded, and at 10% down payment, 50% would be excluded.”

Scary stuff coming around the bend.  Looks like a lot of houses will sit empty.

We have been very optimistic on this site before when it comes to the housing recovery.  Each time we have been disappointed!  However an article from DS News reports that with banks loosening credit standards, the housing crisis could end in 2012.  From DS News,

Banks are also loosening loan-to-value ratios (LTV), which Capital Economics denotes “the clearest sign yet of an improvement in mortgage credit conditions.”  In contrast to a low of 74 percent reached in mid-2010, banks are now lending at 82 percent LTV.

This is good news and action that we hope sticks around for a while. Meanwhile home prices continue to drop according to the latest statistics from Case-Shiller.

Analysts were expecting a year-over-year drop in the range of 3.2 to 3.4 percent, holding constant with the annual declines reported for October of -3.2 percent for the 10-city composite and -3.4 percent for the 20-city measurement.

Eighteen cities’ annual returns were in negative territory in November. Detroit and Washington, D.C. were the only exceptions. At -11.8 percent, Atlanta continued to post the lowest annual results.

Realtors from around the country are reporting there is life in the housing market. That’s some good news!

From Pittsburgh to San Jose, several cities across the country are poised for a solid real estate recovery, according to an article in Forbes via MSNBC.com.  Strong employment numbers and a surprising surge in new home construction seem proof positive that recovery is imminent.

All of the cities that made our list share one common factor: a relatively strong job market. “For real estate to do well you want to see two things: that incomes are growing rapidly like they are in a market like San Jose … and that the growth in jobs attracts other people to that market,” says Ingo Winzer, founder and president of Local Market Monitor. However, job growth should be looked at as a bullish housing indicator only if the unemployment rate is already relatively low — that suggests local companies are creating new jobs rather than rehiring for positions they cut during the recession.

If you live in Boston, Pittsburgh, Rochester, NY, Austin, Raleigh, or New Orleans, the news may be good for sellers in 2012.

Photo by monkeyatlarge.

I have a confession to make here.  My husband’s job was outsourced to India two years ago and he has yet to find another job. Fortunately my own work life has improved so we have managed to stay in our home. We have, however, because of the displaced worker issue requested to modify our mortgage.  We have been trying to do this for a year and a half.  We fax our papers every two months (or more if they ask) showing paycheck receipts.  We  call Wells Fargo every week.  And still… nothing.

This is why as I read the article about the new task force investigating mortgage fraud, I feel a little sense of relief.

After a year of talks aimed at a settlement with five big banks — Bank of America, JPMorgan Chase, Wells Fargo, Citibank and Ally Financial (formerly GMAC) — attorneys general in all 50 states this week have been are poring over the 100-page draft of a the $25 billion deal requiring bankers to commit to modify problem loans that they have been slow to do until now. Under the proposed terms, the banks would also agree to follow strict foreclosure guidelines and procedures and contribute as much as $5 billion to foreclosure relief programs.

I don’t believe for a minute that it will help my husband and me – Mr. & Mrs. Joe Average – but it does give me a sense of satisfaction that perhaps SOMEONE will be helped.

Nothing makes me crazier than having to wait and wait and wait to get something done at someone else’s leisure, but when they finally take action you are expected to immediately JUMP.  If you don’t jump, you are bullied and threatened. Sounds like a bad boss, doesn’t it?  It is actually what happened to real estate agent Mike Cooper’s sellers who had to suffer a short sale at the hands of J.P. Morgan Chase,

On Friday, I was able to get all the players engaged so we can close on Tuesday. On Friday, Chase called again and left another message stating that if we didn’t close by the close of business on Tuesday they were selling the property on the courthouse steps first thing Wednesday morning. By this time, they have so frustrated all the players that attorneys in two different parts of the state, sellers and buyers in two different counties and me in another part of the state all agreed to cross the finish line at the last minute.

Congratulations on successfully closing a difficult short-sale!  Better luck with the next one.

Any time I go into a foreclosed home, I can’t help but wonder about its story. What were the people like who lived there before? Were they happy? Why did they leave?  Agent Linda Murphy of Reno, Nevada had one of these questions answered at a recent showing,

“Hope You Will Love This Home as Much as We Did”
No, this was not the parting sentiment from seller to buyer at a happy closing. It was wistfully painted above the front door, surrounded by an artistic vine of leaves and flowers, of a bank-owned property I showed to some first-time buyers. We didn’t notice it until we were leaving, where it stopped us dead in our tracks. No one spoke for a long time as we resumed our places in the car for the ride to the next potential home.

It is so true that we all sometimes lead lives of quiet desperation.

The Home Affordable Refinance Program is expanding eligibility requirements, allowing homeowners who are underwater to qualify.  By refinancing, homeowners gain a lower interest rate, therefore save money on their monthly payments.  According to Bargaineering, more people may now be eligible,

Before, in order to be eligible for HARP, missing a mortgage payment was not allowed. Now, as long as you haven’t missed a payment in the past six months, it won’t disqualify you if you missed a mortgage payment in the last 12 months. The program has been extended through December 31, 2013, and gives time for homeowners to work to meet eligibility requirements for an eventual refinance.

The catch? Your mortgage has to be a Fannie Mae or Freddie Mac backed.  That makes it too good to be true for many.

Photo by nikcname.