by Vincent Bindi on September 23, 2008
The general perception of many homeowners in Orange County is that the ‘bank is trying to take my home’. That is not true. No bank wants to foreclosure on a property in a declining market such as the current situation in Orange County. The bank lent the borrower the money so they could collect the principal and interest payments and keep the note securitized. If you are paying on time and values are holding or increasing. your mortgage note gets sold and resold for huge profits. Banks make fortunes off borrowers who make every payment on time through the life of a loan.
In 2008’s real estate market, banks stand to lose $0.35 to $0.60 on the dollar for any foreclosed property. This is a gigantic loss, and the banks today would rather collect a lower payment than none at all and own a vacant home. Declining property values combined with constricting lender guidelines and adjusting interest rates have resulted in the modification boom. Basically, when you owe much more on your home that it is worth, you are in deep trouble. No one is going to buy a home for 15% – 30% above market value and no lender is going to refinance that property.
Your mortgage is the collateral for the note that a bank lends a borrower. Realistically speaking, no bank would originate a note lending at over 100% of the value of the property. Even lending at 100% is unreasonable. Millions of Americans have taken out high LTV loans out in markets like Orange county, that were at the time appreciating but now have rapidly depreciated. Then, when the borrowers ARM adjusts and he can no longer make the payment a bank will try to refinance, only to discover there is little chance.
Most believe their only option is to foreclose. Since they cannot make the payments, sell, or refinance, what other options are there ? The first option that a bank gives are a short sale, deed in lieu of foreclosure, or forbearance agreement. With so many Orange County homeowners wanting to keep their home and a vast supply of empty homes, the banks are forced to re-examine their strategy. In today’s economy, banks are willing to modify loans to keep people in their homes. They can reach many more homeowners by doing so and continue receiving monthly mortgage payments.
For more information about Loan Modifications in Orange County, CA., please give our Attorney based Loan Modification affiliate a call at: (888) 530-1212, or drop them an email at: Info@CaLoanModAttorney.com
by Vincent Bindi on September 21, 2008
Currently there are 94 detached home currently list for sale. Of these, 35 are pre-foreclosure Short Sales and 1 is a bank owned REO. That is a total of 38% of the total inventory is a property in financial distress. The Median price for the Short Sale and Bank Owned REO listings is $559,000. The Median price for the none Short Sale/Bank Owned REO detached home listings is $745,900.
In the past 90 days, there were 55 detached homes that sold and closed that were not Short Sale/Bank Owned, and the Median price of these 55 homes was $565,000. In this same period of time, there were 32 detached homes that sold and closed, which represents 37% of the total sold. The Median price of these 32 detached homes was $529,400.
Today, there are 134 Condos listed for sale in Aliso Viejo, CA. Of these, 67 of the active listings are Short Sales (50%), and 12 are Bank Owned REO condos (9%). The Median priced Condo for the 79 Short Sales/Bank Owned condos is $309,400, and the median price for the none short Sales/Bank Owned condos is $394,900.
In the past 90 days, there were a total of 70 Condos that sold and closed escrow that were not Short Sales/Bank REO’s. The median price of these 70 condos was $375,000. In addition, there we 75 condos that sold and closed in Aliso Viejo that were Short Sales or Bank Owned REO’s. The median price for these 75 condos was $295,000. Of these 75 sold condos, 38 were Short Sales and 37 were Bank Owned REO’s.
If you would like more information on homes or condos for sale in Aliso Viejo, feel free to visit our website at: Search OC Homes for Sale. If you would like an email list of all Short Sales or Bank Owned REO homes for sale, visit: www.OCBargainHomes.com
by Vincent Bindi on September 19, 2008
A Loan Modification (sometimes called a Loan Mod), is the altering of one or more of the characteristics of a loan and/or its terms.. Loan Mods are usually the result of the borrowers inability to make payments in the agreed upon time-frame or because the property is worth less than the borrower owes. This means that a Orange County homeowner has taken out a loan to purchase a property, or refinanced a cash out loan,$ and in not able to repay it in accordance to the pre-set schedule designed when the loan was taken out. They then fall behind on their payments and are faced with a few tough choices…. foreclosure, deed in lieu of title, short sale or loan modification. The only option of this list that does not force the Orange County homeowner to lose their home is the Loan Modification.
For homeowners who can document the ability to repay the loan in a reasonable and sustained capacity, the bank will allow certain changes to be made in the loan. These loan modification changes include temporary interest rate reduction, permanent interest rate reduction, adding an interest only option, stretching of amortization, principal balance reduction, a forbearance agreement or a combination of changes.
A loan mod is a negotiation between the homeowner and the bank. The goal of a loan modification is to change the amount of payment to a level where the borrower can consistently make their mortgage payment as well as pay other bills. Banks do not want a mortgage to consume an entire monthly budget. They will take the homeowners entire budget into consideration ie; car payments, cell phone, utilities, credit cards payments, etc. Keep in mind that bank’s loss mitigation department will take into account all necessary expenses to live a normal while still maintaining a reasonable mortgage payment.
Our professional real estate company specializes in loan modifications for Orange County homeowners. We have association with an Attorney who has worked the some of the Nations largest banks. For questions or consultation regarding a potential loan modification, call our Attorney based Loan Modification affiliate: 949-388-3396 or email us at: Info@CaLoanModLawyer.com
