Bon Voyage HUD-1!!!
Come get social with us at booth 625 as we bid the HUD-1 farewell and cruise to the new disclosures.
2015 Florida Realtors® Convention & Trade Expo
Each year, the Florida Realtors® Convention & Trade Expo gathers thousands of Realtors looking to up their game. This years theme is Celebration 15; the event falls on August 19-23 and is held at the Rosen Shingle Creek in Orlando, Florida. The free two-day Expo is on Thursday and Friday–all you have to do is register. There are over 30 education sessions sorted into six learning tracks–technology, broker, productivity, trends, personal growth, and continuing education. Along with the Convention, the Trade Expo has over 200 exhibitors that come packed with promotional materials and exquisite raffle prizes. This years keynote speaker is Notre Dame’s former Head Coach Lou Holtz.
On October 3, 2015 the TILA-RESPA Integrated Disclosure (TRID) rule will go into effect. The Florida Agency Network (FAN) is leading the industry through uncharted waters to the new disclosures. Title agencies in the FAN network are prepped and ready to keep you afloat before, during, and after these industry changes. Join us at booth 625 as we say Bon Voyage to the HUD-1 and celebrate the implementation of the new Closing Disclosure (CD). Get social with us and enter to win an Apple iWatch!
The 2013 national bank failure tally ran up to eight this weekend as three more institutions fell by the wayside.
FDIC announced the collapses of Chipola Community Bank in Marianna, Florida; Heritage Bank of North Florida in Orange Park; and First Federal Bank in Lexington, Kentucky. The last time so many banks shut down at the same time was October 19, 2012.
Chipola Community Bank and Heritage Bank of North Florida were both closed by the Florida Office of Financial Regulation, which appointed FDIC as receiver of both.
According to FDIC, First Federal Bank of Florida (based in Lake City) will assume all of Chipola’s $37.6 million in total deposits and will purchase “essentially all” of the failed bank’s $39.2 million in assets. Meanwhile, FirstAtlantic Bank (in Jacksonville) has agreed to assume or purchase all of Heritage Bank’s $108.5 million in deposits and $110.9 million in assets.
The two banks mark Florida’s first collapses in 2013. Notably, the last FDIC-insured institution to close in the state was Heritage Bank of Florida, based in Lutz.
In Kentucky, Your Community Bank entered into a purchase and assumption agreement over First Federal Bank’s deposits and assets. The former has agreed to assume all of the latter’s $93.9 million in deposits and to purchase nearly all $100.1 million in total assets.
First Federal Bank is the first to close in Kentucky this year. The last time the state saw an FDIC-insured bank fail was September 18, 2009, according to the agency.
Combined, the three collapses cost the Deposit Insurance Fund an estimated $50.2 million, which the FirstAtlantic acquisition being the most costly (at $30.2 million).
By: Tory Barringer, DSNews
Home price gains may be outpacing increases in rent, but the cost of being a homeowner is still much less than that of a renter, according to Trulia’s Winter 2013 Rent vs. Buy report.
After factoring all cost components including transaction costs, taxes, and opportunity costs, Trulia found buying a home is 44 percent cheaper than renting, down slightly from 46 percent a year ago.
“Although buying a home is still cheaper than renting, the gap is closing,” said Jed Kolko, Trulia’s chief economist. “In 2013, home prices should rise faster than rents, and mortgage rates are likely to rise in the next year as the economy improves. By next year, buying could be more expensive than renting in some housing markets, even for people with the best credit.”
In the last year, asking home prices showed a 7 percent gain compared to a 3.2 percent increase in rents during the same time period, according to data from the real estate site.
Trulia explained low mortgage rates have kept the cost of owning down; for the analysis, a 3.5 percent mortgage rate was assumed.
The San Francisco-based company also revealed that out of the 100 largest metros analyzed, buying was more affordable than renting in all metros.
In some metros, the cost of buying was much less than the national average. The buy-rent gap was the largest in Detroit, where buying costs 70 percent less than renting. For the next four metros in top five, the cost of owning was 63 percent less than renting; the four metros were Dayton and Cleveland in Ohio; Warren, Michigan; and Gary, Indiana.
Although owning was found to be less expensive in all metros, owners in San Francisco averaged the smallest savings at 19 percent, a steep decrease from the 35 percent savings seen in 2012.
If one were to receive a mortgage rate of 4.5 percent, Trulia noted the cost of buying would be just 9 percent cheaper in San Francisco. However, a rate of 4.5 percent would still make buying more affordable than renting in all metros analyzed.
“People who didn’t buy a home last year may have missed the bottom of the market, but they haven’t completely missed the boat,” Kolko added. “Even buyers who can’t get today’s lowest mortgage rates will still find that buying makes more financial sense than renting in nearly all local markets – so long as they can get a mortgage in the first place.”
Other metros where owning may not be as enticing to borrowers based on savings were Honolulu, where the cost of owning is 23 percent cheaper, followed by San Jose (-24 percent), New York (-26 percent) and Albany (-30 percent).
By: Esther Cho, DSNews
Predicting trends during volatile economic times in American is no easy task. However, we are going to give it our best shot. We strongly believe these are the five real estate items we should keep an eye on in 2013:
The housing market has turned the corner and there is no reason to believe that buyer demand will not maintain momentum throughout 2013. Household formations shot up to boom-time levels in 2012 and are projected to increase at even a faster rate over the next twelve months. A lack of inventory will be more of a challenge to sales increases than will a lack of demand.
Contrary to what many have hypothesized over the last few years, young adults (18-35 year olds) are just as committed to homeownership as previous generations. Recent studies have shown:
This, along with the increase in household formations mentioned above, makes us believe that 2013 will be the year that many of these young adults will jump into homeownership.
Pricing of any item is determined by supply and demand. Demand for housing will remain strong throughout 2013. At the same time, the supply of homes ready for is shrinking in many parts of the country. Outside of a few states that still have challenges with large inventories of distressed properties (NY, NJ, CT, IL for example), prices will appreciate nicely.
Even in the areas that are still dealing with high percentages of foreclosures and short sales, prices will not tumble dramatically. The increase in demand will absorb much of this inventory. In these areas, prices will either flatten or perhaps soften to a small degree.
Perhaps what many will find as the biggest surprise of 2013 will be the return of the ‘move-up’ seller. Over the last several years negative equity has prevented many of these sellers from moving up to the house of their dreams. However, with prices recovering, more and more of these sellers will realize that now may be their greatest opportunity to make the move to a lifestyle they always wanted.
With home prices expected to increase and more stringent mortgage qualifications (QR and QRM) scheduled to be announced this year, we believe that the first half of the year will bring many of these sellers/buyers to the market.
Real Estate professionals who have invested the money, time and energy to truly understand what is happening and why it is happening will separate themselves from their competition and do very well this year.
Those who take that next step of learning how to simply and effectively communicate the market to their clients will be seen as experts. These industry leaders will dominate their markets.
The Consumer Financial Protection Bureau (CFPB) put a stop to two companies it believes took part in mortgage modification scams that cheated thousands struggling homeowners.
The CFPB alleges Gordon Law Firm and the National Legal Help Center amassed more than $10 million after charging consumers for services that falsely promised to stop foreclosures or provide modifications.
At the bureau’s request, U.S. District Court judges in California ordered both companies to halt operations and froze their assets.
“We are taking on schemes that prey on consumers who are struggling to pay their mortgages or facing foreclosure,” saidCFPB director Richard Cordray in a release. “We are especially concerned with those who misrepresent government programs or websites to divert distressed homeowners from needed assistance.”
The CFPB’s complaints allege that the defendants in both cases violated the Dodd-Frank Act and Regulation O. According to a release from the CFPB, the laws prohibit unfair, deceptive, or abusive practices.
The CFPB alleges violations in both cases include illegally charging upfront fees ranging from $1,000 to $4,500, claiming affiliation with the government, misleading homeowners into believing modifications would be secured, and instructing consumers to stop paying and stop contacting lenders.
The CFPB also alleges the defendants stopped returning calls and emails from customers after taking thousands of dollars in illegal fees from distressed homeowners.
The Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) and Treasury’s Office of Financial Stability referred the case involving the National Legal Help Center to the CFPB.
While almost one-quarter of homeowners remain underwater, rising home prices over the past year have some economists hopeful negative equity could begin to diminish in coming months.
“The negative equity problem is still crippling many homeowners and the wider economy,” Capital Economics stated in a report.
In addition to the almost one-fourth of homeowners who owe more on their mortgage loans than their homes are worth, almost half of homeowners do not meet the 80 percent loan-to-value ratio required for a standard refinancing.
While “[a]dmittedly, the recovery is still in its infancy,” Capital Economics sees the potential for 3.5 million homeowners to move out of negative equity positions over the next 12 months.
CoreLogic reports prices have risen 5 percent over the past 12 months, and Capital Economics reports the greatest movement is occurring in the same locations that experienced the greatest price declines and highest instances of foreclosures and negative equity during the housing crisis.
For example, about 40 percent of homeowners in Arizona and Florida are underwater. However, home prices have risen 18.7 percent and 6.3 percent, respectively, in these two states over the past year.
While Capital Economics is sticking to its prediction that house prices will rise about 5 percent next year, the economists admit “the upside risks to that forecast are clearly rising.”
So far this year, rising home prices have helped 1.3 million households rise out of negative equity, according to CoreLogic.
If home prices were to rise by 10 percent next year, about 3.5 million borrowers would be lifted out of negative equity and 6 million would become eligible for standard refinancing after seeing their loan-to-value ratios fall back to or below 80 percent.
“The faster prices rebound, the quicker the negative equity problem will be resolved,” Capital Economics stated.
With home prices still about 27 percent below their 2006 peak, 10 percent under-valued compared to current rental rates, and 20 percent under-valued compared to per capita incomes, Capital Economics sees no need for concern over another bubble as prices continue to rise.
By: Krista Franks Brock, DSNews
The Mortgage Bankers Association (MBA) released their 3rd Quarter Delinquency Survey last week. The report revealed that both the delinquency and shadow inventory numbers are improving. DSNews, reporting on the survey, explained:
“The Mortgage Bankers Association noted in a Thursday report that a four-year low in serious mortgage delinquencies and a drop in the percentage of loans in foreclosure for the third quarter suggest fewer homes are part of the shadow inventory that’s always threatening prices and creating market uncertainty.”
This is great news. However, we must realize two things:
Back in September, we explained that the foreclosure challenge in most parts of the country is diminishing with the major exception being the Northeast. A new report confirms that states in the Northeast are now leading the nation in percentage increase in foreclosure activity. In Realty Trac’s latest Foreclosure Market Report, it was revealed that:
“The three states with the biggest annual increases in foreclosure activity in October were New Jersey (140 percent), New York (123 percent) and Connecticut (41 percent).”
These same states were rocked by super storm Sandy which will result in a continued delay in these properties coming to market. RealtyTrac’s vice president Daren Blomquist explains:
“We continued to see vastly different foreclosure trends across the country in October, depending primarily on how each state’s foreclosing infrastructure was able to handle the high volume of delinquent loans during the worst of the foreclosure crisis in 2010. Unfortunately the three states dealing with the biggest rebound in deferred foreclosure activity— New Jersey, New York and Connecticut — also had to deal with the devastation to homes inflicted by super storm Sandy. The foreclosure moratoriums being put into effect as a result of the storm will likely extend the already-lengthy time to foreclose in these states, further prolonging a fundamentally sound housing recovery.”
Things are looking better in the vast majority of communities across the country. However, the Northeast should still be looking for prices to soften as Mark Zandi of Moody’s Ecnomy explained in a recent Wall Street Journal article:
“Some markets are still going to suffer more price declines.”
By: The KCM Crew, KCM Blog
The housing market is slowly but surely getting back up to speed, but don’t expect it to recover to peak levels, Freddie Mac says in its latest U.S. Economic and Housing Market Outlook.
In the November outlook, Freddie Mac takes into account recent trends, housing indicators, shifting demographic patterns to put together a picture of what makes a “healthy” housing market. According to the GSE’s projections, the current trajectory of the recovery should bring the market to a healthy state by 2017.
According to the data, housing starts should increase to about 1.7 to 1.8 million homes per year, a pace below the 2.1 million peak set in 2005. However, Freddie Mac VP and chief economist Frank Nothaft said the projected pace should be “much more sustainable” given the pace of household formations.
Starts in Q3 reached about 790,000, according to the GSE’s data.
Home sales are expected to increase to about 5 percent of the housing stock, or 6.5 to 7 million homes per year, compared with sales of 7 percent of the stock in 2005. At the same time, home price appreciation is anticipated to rise gradually to about 3 percent per year, far lower than 11 percent in 2005.
Meanwhile, Freddie expects vacancy rates to ease further to about 1.7 percent for on-sale homes and 8 percent for rental homes, down from peaks of about 3 percent in 2008 and 11 percent in 2009, respectively.
Seriously delinquency rates are forecast to hover near 2 percent, down from the peak of 9.5 percent in 2010.
While the projections may not impress those who expected a return to peak levels, Nothaft the slow but steady path will be better in the long run.
“What a healthy housing market should look like will dismay those who keep comparing housing to what it was during its peak years,” he said. “However, taking into account recent trends, key housing indicators and the shifting demographic patterns that will define a new and realistic trajectory toward a healthy housing market, the long-term prognosis is promising—just don’t expect the housing market to wake up at 98.6 degrees tomorrow morning.”
By: Tory Barringer, DSNews
Fannie Mae and Freddie Mac servicers will be able to skip a step when attempting to get a short sale or deed-in-lieu of foreclosure approved.
On Wednesday, the GSEs announced standard delegation agreements were reached with nine mortgage insurers to allow servicers to approve of short sales and deeds-in-lieu without a separate review process with the mortgage insurer. The agreement takes effect November 1 and should speed up the process for the foreclosure alternatives. The short sale or deed-in-lieu still has to meet the GSEs’ requirements, but servicers don’t have to wait for mortgage insurers to offer their stamp of approval.
“Short sales and deeds-in-lieu are important tools to prevent foreclosures and help struggling borrowers,” said Leslie Peeler,SVP of national servicing organization at Fannie Mae. “These delegation agreements create an even more streamlined process that will ultimately help more families avoid the costly effects of foreclosure and benefit taxpayers. We are pleased that the mortgage insurance companies have stepped up to the plate with us to help more homeowners.”
Tracy Mooney, SVP of servicing and REO at Freddie Mac, said, “We applaud the nation’s mortgage insurers for committing to work with us and our servicers to help more borrowers obtain short sales and other foreclosure alternatives.”
The mortgage insurers that signed onto the agreement are CMGMortgage Insurance Company; Essent Guaranty, Inc.; Genworth Mortgage Insurance Corporation; Mortgage Guaranty Insurance Corporation; PMI Mortgage Insurance Co.; Radian Guaranty Inc.; Republic Mortgage Insurance Company; Triad Guaranty Insurance Corporation, and United Guaranty Mortgage Insurance Company.
The GSEs require mortgage insurance for borrowers who make a downpayment that is less than 20 percent of the property value when taking out a loan.
The announcement adds to Fannie Mae and Freddie Mac’s new standards for short sales, which also take effect November 1. The new guidelines for short sales were adopted to streamline the short sale approval process.
By: Esther Cho, DSNews