Some lenders are seeking action against homeowners who have walked away from their mortgages in foreclosure and some short sales.  Some states allow for 2 action foreclosures. California is NOT one of them we are a 1 action state.  What that means is that the banks have 1 of 2 options against a homeowner in a foreclosure situation; they can either do a regular foreclosure or a judicial action.  States that allow 2 steps is that the lender can foreclose on the homeowner and THEN seek further action for damages they suffer in the foreclosure and seek remedy for that.  Example…. House is foreclosed on, about 3 months later when it sells it sells for less than what was owed on the mortgage and then the lender hires an attorney to go after the foreclosed homeowner for the remaining amount that is owed on the mortgage.

Many states, not California, give mortgage holders as long as five years to seek a deficiency judgment. If granted, the bank gets up to 20 years to collect and the option to renew for another 20 years if the debt isn’t paid against homeowners who have either had their homes foreclosed on or agreed to a short sale.

Another item to note is that most states California DOES allow this, allow collection on unpaid home-equity loans.  And the only way to get out of a 2nd or 3rd mortgage lender from coming after you EVEN after they agree to a payoff in a short sale is to wipe them out in a Ch. 7 Bankruptcy.

You have to remember that mortgage lenders can pull your credit and see if you are paying your other bills on time and if you look to be financially ok to them, they could come after you and ruin you financially.

There is a false sense of security that some real estate agents spin, either because they don’t know or they don’t want to scare you out of the listing with them.  As a homeowner you need to know these things, if you have a line of credit or 2nd mortgage on your home and you are considering a short sale make sure your agent knows about the pitfalls and advises of such.  Always seek the advice of an attorney and CPA when considering a short sale or foreclosure.

article by Kathryn Davis

If you are looking to sell or purchase quality vintage mid century furniture, you’ve got to stop and check out OCMODERN. Our friends who have purchased several pieces of furniture there have suggested this site to Sarah and I, after we expressed our quest for a Danish modern credenza. Located in Long Beach, Josh & Laurie Zimber have showcased all their furniture and accessories for sale in their very own home. If you are a Danish modern enthusiast, admiring the furniture designs of Herman Miller, Saarinen, Hans Wegner, Arne Vodder, FinnJuhl, along with an array of mid-century accessories, then stop by their website or their store/home location and you will not be disappointed.

(Pictured above is a Classic danishmodern Teak Dining Set w/ 6 chairs, $1,350)

–Posted by my iPhone

The Federal Housing Administration (FHA), which is part of the Department of Housing and Urban Development (HUD), administers various single family mortgage insurance programs. These programs operate through FHA-approved lending institutions which submit applications to have the property appraised and have the buyer’s credit approved. These lenders fund the mortgage loans which the Department insures. HUD does not make direct loans to help people buy homes.

The FHA 203k loan program is the Department’s primary program for the rehabilitation and repair of single family properties. Basically a home improvement loan. As such, it is an important tool for community and neighborhood revitalization and for expanding homeownership opportunities. Since these are the primary goals of HUD, the Department believes that FHA 203k loan is an important program and they intend to continue to strongly support the program and the lenders that participate in it.

Lenders have successfully used the FHA 203k loan program in partnership with state and local housing agencies and nonprofit organizations to rehabilitate properties. These lenders, along with state and local government agencies, have found ways to combine the FHA 203k loan with other financial resources, such as HUD’s HOME, HOPE, and Community Development Block Grant Programs, to assist borrowers. Several state housing finance agencies have designed programs, specifically for use with FHA 203k loan and some lenders have also used the expertise of local housing agencies and nonprofit organizations to help manage the rehabilitation processing.

HUD also believes that the FHA 203k loan program is an excellent means for lenders to demonstrate their commitment to lending in lower income communities and to help meet their responsibilities under the Community Reinvestment Act (CRA). HUD is committed to increasing homeownership opportunities for families in these communities and Section 203(k) is an excellent product for use with CRA-type lending programs.

FHA 203K Loan – How the Program Can Be Used:

This program can be used to accomplish rehabilitation and/or improvement of an existing one-to-four unit dwelling in one of three ways:

· To purchase a dwelling and the land on which the dwelling is located and rehabilitate it.

· To purchase a dwelling on another site, move it onto a new foundation on the mortgaged property and rehabilitate it.

· To refinance existing indebtedness and rehabilitate a dwelling;

To purchase a dwelling and the land on which the dwelling is located and rehabilitate it, and to refinance existing indebtedness and rehabilitate such a dwelling, the mortgage must be a first lien on the property and the loan proceeds (other than rehabilitation funds) must be available before the rehabilitation begins.

To purchase a dwelling on another site, move it onto a new foundation and rehabilitate it, the mortgage must be a first lien on the property; however, loan proceeds for the moving of the house cannot be made available until the unit is attached to the new foundation.

For more information, go to:

http://tinyurl.com/y9at7lj

–Posted from my iPhone

The July 2009 median price rose 3.9 percent compared with June’s $274,740 median price…Sales in July 2009 increased 8.1 percent compared with the previous month. The market has been so crazy that I haven’t been able to keep up with this dusty blog. Enjoy the stats. -Richard

Quick Facts:

· Existing, single-family home sales increased 12 percent in July to a seasonally adjusted rate of 553,910 on an annualized basis.
· The statewide median price of an existing single-family home increased 3.9 percent in July to
$285,480, compared with June 2009.
· C.A.R.’s Unsold Inventory Index fell to 3.9 months in July, compared with 6.9 months in July 2008.

LOS ANGELES (Aug. 25) – Home sales increased 12 percent in July in California compared with the same period a year ago, while the median price of an existing home declined 19.6 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today.

“The federal tax credit for first-time buyers played a critical role in the purchase decision of many buyers,” said C.A.R. President James Liptak. “Nearly 40 percent of first-time buyers said they would not have purchased a home if the tax credit was not offered.

“Because the tax credit has helped so many first-time buyers become homeowners, it is critical that Congress extends the credit beyond the Dec. 1 deadline, and includes all buyers, not just first-timers.”

Closed escrow sales of existing, single-family detached homes in California totaled 553,910 in July at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR® associations statewide. Statewide home resale activity increased 12 percent from the revised 494,390 sales pace recorded in July 2008. Sales in July 2009 increased 8.1 percent compared with the previous month.

The statewide sales figure represents what the total number of homes sold during 2009 would be if sales maintained the July pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

The median price of an existing, single-family detached home in California during July 2009 was $285,480, a 19.6 percent decrease from the revised $355,000 median for July 2008, C.A.R. reported. The July 2009 median price rose 3.9 percent compared with June’s $274,740 median price.

“July marked the fifth consecutive month of month-to-month increases in the median price,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “This was the largest increase on record for the month of July based on statistics dating back to 1979. The yearly decline in July also was the smallest in the past 19 months.

“Favorable home prices in the low end of the market continue to propel sales of homes priced less than $500,000,” said Appleton-Young. “This price segment now accounts for 74 percent of the market share compared with just 43 percent prior to the start of the credit crunch. The high-end segment continues to experience elevated inventories and declines in the median price as financing for jumbo loans and unrealistic sellers challenge the market.”

Highlights of C.A.R.’s resale housing figures for July 2009:

C.A.R.’s Unsold Inventory Index for existing, single-family detached homes in July 2009 was 3.9 months, compared with 6.9 months (revised) for the same period a year ago. The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate.

Thirty-year fixed-mortgage interest rates averaged 5.22 percent during July 2009, compared with 6.43 percent in July 2008, according to Freddie Mac. Adjustable-mortgage interest rates averaged 4.82 percent in July 2009, compared with 5.24 percent in July 2008.

The median number of days it took to sell a single-family home was 39.9 days in July 2009, compared with 47.8 days (revised) for the same period a year ago.

Regional MLS sales and price information are contained in the tables that accompany this press release. Regional sales data are not adjusted to account for seasonal factors that can influence home sales. The MLS median price and sales data for detached homes are generated from a survey of more than 90 associations of REALTORS® throughout the state. MLS median price and sales data for condominiums are based on a survey of more than 60 associations. The median price for both detached homes and condominiums represents closed escrow sales.

In a separate report covering more localized statistics generated by C.A.R. and DataQuick Information Systems, 23 of the 398 cities and communities reporting showed an increase in their respective median home prices from a year ago. DataQuick statistics are based on county records data rather than MLS information. DataQuick Information Systems is a subsidiary of Vancouver-based MacDonald Dettwiler and Associates. (The lists are generated for incorporated cities with a minimum of 30 recorded sales in the month.)

Note: Large changes in local median home prices typically indicate both local home price appreciation, and often, large shifts in the composition of housing market activity. Some of the variations in median home prices for July may be exaggerated due to compositional changes in housing demand. The DataQuick tables listing median home prices in California cities and counties are accessible through C.A.R. Online at
http://car.org/economics/historicalprices/2009medianprices/jul09medianprices

Statewide, the 10 cities with the highest median home prices in California during July 2009 were: Los Altos, $1,425,500; Palo Alto, $1,363,000; Saratoga, $1,350,000; Newport Beach, $1,300,000; Manhattan Beach, $1,257,500; Burlingame, $1,250,000; Palos Verdes Estates, $1,132,000; Los Gatos, $1,085,000; Cupertino, $952,000; and Rancho Palos Verdes $945,000.

Statewide, the cities with the greatest median home price increases in July 2009 compared with the same period a year ago were: Laguna Hills, 40.5 percent; Newport Beach, 13.5 percent; Moorpark, 11.2 percent; Poway, 10.8 percent; San Marcos, 8.6 percent; Emeryville, 7.6 percent; Santa Barbara, 6.3 percent; Arcadia, 5.8 percent; Big Bear Lake, 5.5 percent; and West Hollywood, 5 percent.

the CALIFORNIA ASSOCIATION OF REALTORS® is one of the largest state trade organizations in the United States, with more than 163,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

C.A.R.’s “2009 Survey of California Home Buyers” Highlights

Favorable home prices, record-low interest rates, and the belief that rates will rise in the near future were the primary motivators leading home buyers to purchase in 2009 compared with last year, according C.A.R.’s “2009 Survey of California Home Buyers,” released this week.

68% of buyers said price decreases motivated them to buy a home, while 39% reported low interest rates helped them move to a better location.

23% claimed the likelihood that rates will move up as the motivating factor.

“After back-to-back years of sharp declines, home sales in California rebounded in 2008 and early 2009,” said C.A.R. President James Liptak. “The increase reflected the combination of favorable prices, low mortgage rates, and home buyer tax credits, fueled primarily by sales of distressed properties that accounted for more than half of the state’s transactions.

Housing affordability has improved dramatically in response to the decline in home prices along with historically low mortgage rates, creating a tremendous opportunity for home buyers in California.”

49% of all buyers purchased a home through a traditional market sale, while 38% purchased a REO/bank-owned property, according to the survey.

Reflecting the difficulty in closing short sales — properties selling for less than the loan amount — only 13% of buyers purchased a short-sale property.

Home buyers who purchased a REO or bank-owned property experienced the highest level of difficulty in obtaining financing, compared with a more traditional transaction.

They rated the level of difficulty as 8.9 (on a scale of 1 to 10 with 10 representing the greatest level of difficulty in obtaining financing) compared with a 7.7 for home buyers with a traditional market sale and 7.6 for short-sale home buyers.

Source: CALIFORNIA ASSOCIATION OF REALTORS, July 2009

What Exactly is Mello-Roos? by Todd Foust and Charmaine Ngo
California Home Buying Information

Inflation on the Horizon? by Dennis Torres
As the government prints trillions of dollars, currency may become devalued.

About three years ago, I was invited to sit on a panel of real estate experts at a conference organized by Pepperdine University’s business school. I spoke of an impending housing market collapse, citing my belief that we would soon see home values decline 35 percent to 40 percent.

I wasn’t too popular that day, yet I felt compelled to share my educated opinon. As a real estate professional for 35 years, I had already seen two major residential market downturns, one from 1979 to 1980 and another from 1989 to 1990. In the overheated 2006 market, I was sure I recognized the signs of another impending slump. Central to my argument was that the housing market, like most industries, is cyclical. Surprisingly, my fellow panelists, who represented some large lenders and real estate franchises, strongly disagreed with my predictions. They all stuck to their conviction that the housing market was going to remain strong in the next few years—or, at worse, decline 5 percent to 10 percent. They subscribed to the popular slogan at that time: “soft landing.” I called it wishful thinking.

Four Horsemen of Real Estate
I spoke of the coming four horsemen of the real estate market apocalypse. The first horseman we have already seen: the collapse of the subprime loan market followed by losses in the prime mortgage market. RealtyTrac reported 3.2 million foreclosure filings last year, an 81 percent increase from 2007. Projections for this year have not been much brighter, though the passage of economic stimulus legislation offers hope for market stabilization.

We’re currently dealing with the next two horsemen, and they continue to be a huge drag on the market: high unemployment and burdensome consumer debt. The U.S. unemployment rate has been steadily climbing, reaching 8.9 percent in April, the highest level in 25 years. Without a job, consumers are less likely to pay their bills, including mortgages. Meanwhile, consumer debt is piling up; U.S. consumers carry $900 billion in credit card debt alone, according to the Federal Reserve.

The fourth horseman is still on the horizon but is quickly moving our way: rampant inflation. The reasoning behind my prediction is basic economics. Our government cannot print trillions of dollars to pay for wars and various industry bailouts without devaluing the worth of the dollar. In addition, it’s been quite a while since our country has experienced high inflation; in my opinion, we’re overdue.

Price Appreciation
How will this affect the real estate market? It will become more difficult for consumers to afford a home, since wages seldom keep pace with inflation. In times of inflation, the price of durable goods such as housing rises dramatically. But this will benefit the market, too. While higher home prices may deter some buyers, others will rush to purchase at a time when prices are appreciating. And home owners will be happy to see the value of their home go up.

It’s also important to note that unlike the “bubble” of our recent past, in which property values rose quickly in large part due to speculation, inflation will not lead to a housing market collapse because prices will be based on the intrinsic value of the then-current dollar.

So, what good is a forecast without a time line? Here’s mine: I see inflation taking hold within two years. The housing market will continue to decline through 2009, then home prices will stagnate for three to five years before climbing again around 2015. I say this with great humility, knowing that in times like this, with so many unforeseen variables, accurate predictions can be a moving target.  -JUNE 2009

Dennis Torres, a licensed California real estate broker, oversees Pepperdine University’s real estate strategies as director of real estate operations. Torres also serves as the university’s adjunct professor of negotiation and dispute resolution.