Thursday, November 30, 2006

Repossesions "Record" In Arkansas

The Morning News reports from Arkansas. "Area economists and bankers alike agree the housing market in Northwest Arkansas is slumping from last year's all time high. The oversupply in upper end homes, predominantly in Benton County, has been the talk for months. But another less discussed aspect of the recent market downturn is foreclosure and the opportunities that exist for potential buyers."

"Betty Galloway, broker in Springdale, said her company is listing a record number of repossessions, almost one per day, primarily because the homeowners were enticed into buying homes they couldn't afford thanks to adjustable rate mortgages and interest only loans. 'I have been in the real estate business since 1976 and I have never seen this many repos come through my office for listing,' Galloway said."

"'When you are this far into a housing boom, this type of fallout is not terribly surprising,' said Kathy Deck, associate director for the Center for Business and Economic Research at the University of Arkansas. 'We have listed several homes for local banks and they were priced to sell quickly, at about 5 to 10 percent below appraisal,' said broker Mike Price."

John Sullivan, broker in Tontitown conducts area auctions for homeowners looking to sell property quick, sometimes to prevent foreclosure. He said auctions and foreclosures do represent excellent opportunities for interested buyers."

"'We have worked with a number of homeowners who were trying to avoid losing their homes to foreclosure. We also get calls weekly from builders who want us to auction their property,' Sullivan said. 'The problem with the builders is they don't own it, the banks do.'"

"Sullivan blames the lack of equity problem on a rampant misuse of financing, particularly refinancing. He said those families who refinance and don't stop spending can soon find out they can no longer afford to live in their home. Sullivan said he rejects many auctions because homeowners don't have enough equity in the home to cover the expenses and pay off the loan."

"'We are seeing some sellers who have recent appraisals and loans higher than the real market values. Appraisals for refinances are often done by banks who want to lend the money. Some use a liberal approach,' Sullivan said."

"In the end, the market value appraisal is only the amount a buyer is willing to pay. Sullivan said buyers today are paying less than they were a year ago and that means buyers have the advantage."

"Repos also add to the housing surplus and can drive down other home prices, Galloway said. For instance, if a repossessed home in a neighborhood sells for less than market price, other homes for sale in the same neighborhood will likely get similar offers."

Wednesday, November 29, 2006

Mortgage Fraud Drives Defaults In Colorado

The Denver Channel reports from Colorado. "Colorado's housing foreclosures are nearing a record, driving down prices and damaging neighborhoods and one reason is mortgage fraud. A hit-and-run death has led 7NEWS investigator John Ferrugia on a trail to what may be a ring involved in setting up illegal immigrants with fraudulent mortgages."

"Daniel Martinez-Ruiz is an illegal immigrant charged this month with using phony documents to purchase property. His wife Conception Hernandez is charged with similar crimes and is out on bail. 7NEWS Investigators first learned about them and the questionable loans after they began investigating the death of Justin Goodman, who was killed in 2004 by a hit-and-run driver. The man who killed him and who is now serving time in prison is Roberto Martinez-Ruiz, another member of the same immigrant family."

"So, how could he and his family get mortgages to buy homes? 'There's lenders out there that will do a completely fraudulent loan to get them a house so that they can stay here,' said John Vizzi. Vizzi is in the real estate and mortgage lending business and he is the uncle of Goodman."

"7NEWS' investigation has found that the immigrant family used phony documents, and in apparent collusion with realtors and lenders, received fraudulent loans to buy two homes in Thornton which were backed by F.H.A. loans."

"7NEWS investigators have learned Martinez used a phony name on a fraudulent alien card because he had no credit and documents show that Hernandez used a fraudulent Colorado driver's license. Adams County district attorney Don Quick has now charged three members of the family and a realtor with several felonies."

"'In this case, the buyers themselves are charged as being part of the scheme,' said Quick. 7NEWS has learned that part of the scheme also involves phony W-2 forms and pay stubs from a Colorado cleaning service. Golden Eagle Cleaning was set up by Daniel Martinez, again with fraudulent documents, as income verification to obtain the loan, John Ferrugia said."

"But Hernandez claims it wasn't the family who produced the fraudulent financial documents, but the realtor and lender. The lender's name is William Romano. 7NEWS investigators learned it is Romano whose name appears on the loan application and who accepted the fraudulent documents."

"But was it Romano who actually produced the phony W-2s and check stubs? Romano said he didn't know anything and he was clearly not anxious to discuss his work. 'The lender's responsibility at the end of the day is to make sure the underlying documents are sufficient and accurate,' said Quick."

"Because of 7NEWS' investigation, Quick is now investigating Romano and the realtors he has dealt with. 'In this case, we know a number of people who were involved in those documents. We're still pending the investigation to determine if it's a broader net than that,' said Quick."

"The real estate agent who dealt with the illegal immigrants has been charged."

"The point is how mortgage involving illegal immigrants works, Ferrugia said. It is clear that everyone in the chain of illegal activity gets paid and there's no law that makes anyone in the chain, the realtor, the lenders, the FHA, directly responsible for insuring documents used in the transaction are legitimate."

"In this case, foreclosures on these houses cost taxpayers a total of about $140,000 because the FHA protected the lenders. This is only one of thousands of such cases costing taxpayers millions in the state of Colorado alone. Most of it simply goes unnoticed because no government agency has time or the mandate to investigate."

Monday, November 27, 2006

"Mortgage Reset And Equity Strain": California

The Modesto Bee from California. "Foreclosures are soaring dramatically in the Northern San Joaquin Valley as homeowners struggle with rising mortgage rates, falling home prices and a stagnant real estate market. A higher percentage of Stanislaus County homeowners were in default on their mortgages last month, 0.47 percent, than in any other California county."

"Many Merced County and San Joaquin County homeowners also are in trouble, with default rates over 0.35 percent. Merced had the third highest percentage of defaults in California. San Joaquin had the fourth highest. The three Valley counties had more than 1,600 homes in default on mortgages in October. That's about eight times as many as in October 2005."

"While most homeowners in default typically can sell or refinance before foreclosure, the number of those who can't is growing. There were 128 homes in Stanislaus, Merced and San Joaquin counties taken over by lenders during October. Compare that with October 2005, when 10 homes were lost to foreclosure in the three counties, according to DataQuick."

"A new analysis predicts 4,866 homeowners in Stanislaus, 7,591 in San Joaquin and 2,309 in Merced likely will lose homes to foreclosure because adjustable-rate mortgages will push their payments too high during the next five years. That's on top of foreclosures caused by traditional problems."

"Christopher Cagan, director of research and analytics for First American Real Estate Solutions, recently published two studies on foreclosures, and his predictions for the Northern San Joaquin Valley aren't pretty. Cagan warns 'the double whammy' of adjustable mortgage interest rates on homes with little or no equity will force borrowers into foreclosure."

"Homeowners in the biggest trouble are those who bought homes with little money down and 'teaser' rate mortgages. Such adjustable-rate mortgages aren't new, but what's changed is the real estate market."

During 2004 and 2005, Cagan said, homeowners who had mortgages adjust to unaffordable levels had ways to get out of trouble. That's not the case now because home prices have dropped about 5 percent compared with last year in the Northern San Joaquin Valley."

"'Some homeowners will find it hard to sell or refinance because they may have little or no equity in their residences,' Cagan said."

"He calculated that about 19 percent of homes, that's nearly 1 in 5, that were purchased or refinanced since 2004 in the Northern San Joaquin Valley are likely to be foreclosed during the next five years because of what he calls 'mortgage reset and equity strain.'"

"Borrowers who agreed to such adjustable-rate loans with little or no down payments may not have comprehended what they were getting into, said Frank Mandella, president of the San Joaquin Valley chapter of the California Association of Mortgage Brokers. 'I'm sure some of those loans were made to people who did not understand the advantages and disadvantages,' Mandella said. 'Maybe they were not educated properly on how the lending program worked.'"

"Mandella, who owns Meadow Lake Mortgage in Stockton, said that during the past few years there were mortgages available for as much as 125 percent of a home's assessed value. 'They were designed for people to consolidate debt,' Mandella said. He said there also were loans for 103 percent of value to enable buyers to pay for a home and its closing costs."

Loans for more than 100 percent of a home's value have become rare, Mandella said, but there are still a wide variety of mortgages offered.

"Homeowners who choose the wrong mortgage and have their homes foreclosed may end up watching their property get auctioned on the county courthouse steps. More times than not these days, however, no one bids on foreclosed houses because lenders are owed more than the property is worth. That means the starting bid often is too high to attract buyers."

"Lenders then end up taking possession of the foreclosed homes, and they list them with real estate agents. Increasingly, those houses end up selling at a loss. 'They don't want to sit there holding onto it,' Cagan said."

"He estimated lenders may lose $1.8 billion because of foreclosures in the Northern San Joaquin Valley during the next five years."

Friday, November 24, 2006

Arizona Defaults Havn't Slowed Lending

The Arizona Republic. "The rate of residential mortgage foreclosures in Maricopa County rose 35 percent in August. The rise in foreclosure filings has not translated into more stringent requirements for business borrowers, commercial lenders say. 'We're talking to business owners every day,' said Bonnie Jessen, First National Bank of Arizona vice president. 'There is so much availability of money right now that it's not an issue. If anything, it's more of a buyer's market for a mortgage than it's ever been.'"

"Scott Coles, president of the state's largest and oldest private mortgage lender, said that when the market tightens, his firm scrutinizes the borrower and the project more closely. 'We're feeling the pinch in a small portion of loans,' Coles added. 'In a few cases, there have been some concessions.'"

"The commercial real estate market in the Valley 'will hold itself,' Coles predicted. "Properties can be converted for multiple uses. Condominiums can become office space or retail complexes.'"

"Randy Persson, president of Kenwood Mortgage and Investment in Scottsdale, said his firm's portfolio is holding steady, but Kenwood is engaged in land loans in locations such as Eloy and La Paz. 'In a downturn, the outlying areas get into trouble first,' he said. 'We're adapting a wait-and-see attitude.'"

Tuesday, November 21, 2006

Banks Offering Deals: Michigan, Ohio

From ABC Local 12 in Michigan. "Real estate agent John Cunningham says more than one-third of the home sales pending right now in Genesee County are in foreclosure. He's personally handing 43 homes that are in the process of foreclosure."

"'Buyers have a misconception that people are going to have to pay what somebody owed on the house,' Cunningham said. 'People are owing on this house over $190,000. Now the home's for sale for $149,900.'"

"The downside for sellers is that the rest of the market is competing with all those foreclosed homes and that's pushing down prices. 'Trying to sell and move out is bleak,' Cunningham said."

"Banks are getting very aggressive offering great deals. The inventory is sky high: more than 7,100 homes are for sale in Genesee County alone."

From USA Today. "Ohio's foreclosure rate is weighing on Cleveland's real estate market. In a one-two punch, manufacturing job losses and predatory lenders have hurt homeowners."

"In Ohio, one in every 10 subprime loans is in foreclosure. The number of homes for sale in Cleveland has risen to 49,000, a two-year supply. Nationally, by comparison, there's only about a seven-month inventory of homes for sale."

"'A lot of industrial jobs have left,' says Dennis Rath of ERA Rath Realtors. People used to commute to work at the steel mills in Lorain, for example, but now, 'Lorain is like a ghost town. There's nothing left.'"

"The market for first-time buyers, in Cleveland, typically homes priced below $150,000, is still strong, while homes listed above $180,000 are selling slowly."

Sunday, November 19, 2006

Arkansas Builders Going Into Default

The Arkansas Democrat Gazette. "The companies providing lumber, concrete, cabinets and the central vacuum system for the house at 1 Partridge Run want their money, but Betty’s Homes isn’t paying. The house is at the heart of the spiffy Quailridge subdivision, where new brick homes start at $275,000."

"A few months ago, a house like the one on Partridge Run would have sold before it was finished. Not these days. Builders now have more homes than buyers, particularly ones with price tags near $300,000. More and more Northwest Arkansas homebuilders are dealing with liens and foreclosures because they can’t pay their debts to banks and construction suppliers."

"'There are undoubtedly going to be more foreclosures on the builders,' said Ross Ridout, an attorney and vice president of Ridout Lumber Co. 'Northwest Arkansas is overbuilt significantly. Builders need to sell houses, and if they don’t sell, they can’t afford for them to sit there unsold and pay interest.'"

"The 2,245-square-foot house on Partridge Run is on the market for $291,900, but a quagmire of materialman’s liens, foreclosures and bankruptcy complicates the sale. Bella Vista-based Betty’s Homes, one of the region’s largest homebuilders and the company that built the Partridge Run house, filed for bankruptcy Oct. 20. The company owes $ 8,984,741.33 to banks, according to its Chapter 11 filing. The company, which built houses in Bella Vista, Centerton and Lowell, also owes $885,928.54 to construction supply companies."

"'Things kept getting later and later, but we did continue to extend credit to them,' said Jennifer Grandon, a billing supervisor for a Springdale company that hasn’t been paid $2,085 for garage doors that went on the Partridge Run house on June 26. 'After a certain point, we did have to file liens. If they would pay, we’d still do business with them.'"

"Liens give vendors leverage against builders by preventing the sale of a home until the builder pays for the materials used to build it."

"Materialman’s liens are increasing in Washington County, too, although less dramatically. The filings grew from 85 in 2004 to 139 in 2005, county records show. There were 207 in the first 10 months of this year."

"Many suppliers are convinced they’ll never get all the money owed by Betty’s Homes. Banks are paid first in bankruptcy proceedings. They get first dibs because they obtained collateral for their loans, Tulane Law School Dean Lawrence Ponoroff said. 'It’s not that they’re banks,' Ponoroff said. 'It’s that they’re secured creditors.'"

"The construction supply companies are unsecured creditors, so they get paid after the banks. Betty’s Homes listed more than 130 unsecured creditors in paperwork filed Nov. 6 with the bankruptcy court. Betty’s Homes listed assets of $15,925,652.06."

"Dennis Tune, president of Tune Concrete in Fayetteville, said the 25 liens filed by his business against Betty’s Home are more than he’s filed in the previous 20 years. Tune said he’ll be surprised if his company receives 'a dime for every dollar' it’s owed. 'I’m mad at myself because I let them get that far in debt, and I’m mad at myself for not shutting it off earlier,' Tune said. 'It’s the homebuilders’ fault, the banks’ fault because they loan anybody who has a pulse money, and the suppliers who have been overzealous with credit. It’s all our fault.'"

"The changed home-building environment has affected employees of some companies. Betty’s Homes has let six or seven employees go, Bond said. Wholesale Overhead Door laid off six employees, Grandon said. Other companies have taken similar approaches, reducing employees’ hours and eliminating jobs."

"Between 1, 100 and 1, 250 newcomers move into Benton and Washington counties each month, according to researchers at the Center for Business and Economic Research, a part of the Sam M. Walton College of Business at the University of Arkansas at Fayetteville. Despite the rapid growth, there were 525 more unoccupied homes in Benton and Washington counties in September than in May, according to the Skyline Report."

"The latest Skyline Report, made public Monday, showed 2,956 unoccupied homes in the two counties at the end of September. The figure is significant because new housing starts for both counties dropped to the lowest point in two years. Builders started 204 single-family houses during the third quarter, well below the record 462 started in the second quarter of 2005."

"The glut of unsold houses shouldn’t have been a surprise, said Jeff Collins, the center’s director who began pointing out the signs of a coming surplus as early as two years ago. 'Things weren’t looking very good,' Collins said. 'It’s like this: I kept telling people two plus two is four. If you don’t like four, I can’t help that, but the number is still four.'"

"The glut didn’t worry Don Marley, the Fort Smith developer who started the Quailridge subdivision in Centerton last year. Quailridge builders will be able to keep selling houses despite the abundance of similarly priced houses in other subdivisions. 'I wanted to set a better standard,' Marley said earlier this month as he showed off the curvy, community swimming pool behind the property owners association clubhouse. 'We wanted this to be a neighborhood.'"

"The subdivision is among the newest in Northwest Arkansas; the first homes were occupied in the spring. At present, 13 homes in Quailridge are occupied, and 44 others are finished on the outside and within a month of competition inside. None have buyers, though. Another 33 houses are in an earlier stage of construction, and 78 lots have been sold but construction hasn’t begun.'"

"Ridout, the lumber company vice president, said some responsibility for what’s changed in Northwest Arkansas’ housing market rests with the banks. 'There’s a tremendous amount of banking competition in Northwest Arkansas, and they are starving for construction lending,' Ridout said. 'They are doing a poor job of qualifying their customers. It’s the banks being in tough competition and needing construction loans, and there’s an influx of builders who are new to the market.'"

"Northwest Arkansas’ booming economy and the region’s population growth are main reasons for so many new banks and bank branches, said Charles Miller, government relations director for the Arkansas Bankers Association."

Friday, November 17, 2006

Tax Lien Sales Up In Colorado

The Denver Post reports on tax liens. "The number of homeowners and businesses falling behind on their property taxes in the metro area is on the rise. Adams, Arapahoe, Denver and Jefferson counties, in recently concluded auctions, sold 51 percent more property-tax liens to investors this year than last; 10,398 versus 6,879."

"The jump reflects several trends, including a sharp rise in mortgage foreclosures, and homebuilders unable to generate cash they need to cover taxes on their undeveloped lots. 'We are early on in the pain game,' Adams County Treasurer John Lefebvre said. 'How long can people hold on?'"

"But one person's pain can be another's gain. Tax-lien sales are designed to find investors willing to pay overdue property taxes needed to fund counties, school districts and other local governments. In return, investors have the potential to earn an enticing return, 15 percent this year, that the delinquent property owner must eventually pay."

"But there's a catch. When a lot of people bid on tax-lien certificates, a premium is often required, typically 5 percent to 8 percent of the lien amount. Someone who pays a 6-percent premium for a tax lien that is paid off by the property owner in a month or two will lose money. And about two-thirds of liens get paid off within a year."

"Arapahoe County limited attendance at its tax auction Wednesday to 250, with 50 more people waiting to grab empty seats as people left, said Jan Neilson, deputy treasurer. Close to 300 people registered to bid on more than 3,000 tax liens in Adams County, compared with 178 people last year."

"Veteran investors, who years ago faced almost no competition, must now bid against corporations, nationwide investment pools and wealthy out-of-staters. That means higher premiums for counties, and premiums are pure gravy."

"Jefferson County, for example, collected $449,000 in premiums from its online tax-lien auction, deputy treasurer Dave Vil lano said."

"A common myth promoted at some real-estate seminars is that tax liens are an easy path to acquiring properties on the cheap. That almost never happens, treasurers said. Even in a foreclosure, mortgage lenders will step in to make good on the tax lien rather than have an investor cut them out."

"Property owners are allowed to go three years on a tax lien before a lien holder can apply for a deed to the property. When owners don't cover a lien, it is usually because the land is worthless."

"But lien buyer Hans Pieren from Greeley, said the returns are hard to beat, especially if a lien doesn't get paid off for two or three years. 'You are lucky if you can get 15 percent in the stock market,' he said."

Wednesday, November 15, 2006

Short Sales, Defaults Surge In Stockton, CA

The reports from California. "Foreclosure activity locally has been surging, according to a new national survey. Stockton placed 20th highest for foreclosure activity out of 100 metropolitan areas across the United States in a new report an online marketplace for foreclosure properties."

"The Stockton metro area, basically, San Joaquin County, had 1,050 mortgages in some stage of the foreclosure process. The top foreclosure rankings went to Detroit; Fort Lauderdale, Fla.; Denver; Miami; and Dallas."

"California metro areas accounted for seven out of the top 50 foreclosure areas in the country, with only the Riverside/San Bernardino area (12th) and Stockton (20th) in the top 20. 'The third quarter saw a marked increase in the number of properties entering some stage of foreclosure,' said James Saccacio, CEO of RealtyTrac. 'It appears that a combination of factors, including a slowdown in home sales and lower home appreciation rates, are contributing to higher numbers of delinquencies.'"

"It's also likely that part of the reason for the increased foreclosure rates is the long-anticipated effect of the first wave of adjustable-rate mortgages re-setting at higher monthly payments, putting homeowners into financial distress, he said."

"The latest quarterly data report from DataQuick showed that third-quarter residential foreclosure activity in San Joaquin County increased to its highest level in more than seven years. Lenders sent out 898 default notices in San Joaquin County last quarter. That was a 178 percent jump year to year from 323 notices in the third quarter of 2005. Unlike RealtyTrac, DataQuick measures only the issuances of default notices."

"Statewide, lenders sent out 26,705 default notices to California homeowners during the July-to-September period, up 111.8 percent from 12,606 in the third quarter of 2005, the report said."

"Ben Balsbaugh, residential sales manager in Stockton, said that more houses on the verge of foreclosure are hitting the market, especially 'short sales,' where a bank is working with a seller who owes more than the property is worth."

"Short sales are up these days, Balsbaugh said, but this doesn't necessarily mean bargains for home buyers. 'There are so many homes for sale out there right now, the chances of getting a deal is better with an individual seller who is highly motivated in this competitive market,' he said."

"Plus, bank short sales typically have a much longer escrow period than deals involving noninstitutional sellers, he said."

Monday, November 13, 2006

Multifamily REO's In Colorado

The Denver Post reports from Colorado. "Homeowners aren't the only ones having problems paying mortgage loans. Some investors in Colorado have also had rental properties foreclosed upon recently, especially in and around Longmont and Greeley, where there's a big rental market, some Realtors say."

"Recent 'for sale' listings show at least 10 duplex and apartment buildings owned by banks and on the market in Longmont."

"'(Investors) thought they were going to make a fast buck, and they got caught, because the housing economy goes in cycles,' said Lynn Bishop, a spokeswoman for the Colorado Mortgage Lenders Association. 'You're going to 'walk' on it if you can't find a renter.'"

"If an investor with renters faces foreclosure, those renters are forced to move when a bank takes over, said Bryan Potter, a property manager at Alert Realty in Longmont with more than 2,000 rental properties. Potter said he has seen such cases two or three times in the past six months."

"If rental properties go into foreclosure, it's usually because investors have taken on interest-only mortgages with high monthly payments, said Lu Etta Legler, a Realtor in Brighton who also owns investment property. Investors who manage to find good renters still have to plan for a softer market and potential vacancies. For example, a rental home Legler owns in Greeley that used to take in $1,000 per month now reaps only $800 per month, she said."

"'A lot of people in this market say, 'This is the time to buy and rent it out and it will make my mortgage payment for me.' But they don't plan for vacancies,' Legler said. 'You have to plan for at least four months.'"

Friday, November 10, 2006

A 'Foreclosure Bubble" For Dallas

From the Dallas News. "The biggest threat to the local housing market isn't overheated prices or a slowdown in sales. What has the greatest potential for problems is the North Texas foreclosure bubble. So far this year, more than 35,000 homes in the Dallas-Fort Worth area have been posted for foreclosure. More than 15,000 homes have been taken by lenders when the owners couldn't keep up with the payments."

"That means more than a quarter of the pre-owned houses up for sale in the Dallas-Fort Worth area are foreclosed properties. Is that a problem? You bet it is. In the late 1980s and early 1990s, a surge in home foreclosures destroyed residential values in Texas."

"Eventually the sale of reduced-priced foreclosed houses drives down overall residential values. So far, lenders have been holding the line on foreclosed property prices. They remember what happened in the last crash and don't want a repeat of the home fire sales."

"But with the inventories of foreclosed houses growing in other U.S. markets out West and in parts of Florida, I wonder how long the lenders will be able to keep their prices up."

"And there's no sign that home foreclosures are slowing. In November, postings were up almost 50 percent in the D-FW area."

"On Sunday an auction company will be peddling about 80 homes in the Dallas-Fort Worth area. The properties it is selling range from $10,000 to more than $400,000, according to spokeswoman Crystal Wright. The homes include everything from a 999-square-foot condo in northeast Dallas to an almost new 4,000-square-foot house in Frisco."

"'It's a real opportunity for people to get properties in good condition at significant discounts,' Ms. Wright said."

Wednesday, November 08, 2006

Auctions Pick Up In Nevada, Florida, Colo.

From Tampa Bay Online in Florida. "More than a year after launching one of the area's most expensive condo conversions, Bay Communities is trying a novel approach to unload its unsold units at The Hamptons in Tampa Palms. The developer will sell 100 condominiums on Dec. 9 at a public auction, 40 condos will be sold 'absolute' - awarded to the highest bidder with no minimum bid."

"The developer owes the county $1 million in back taxes. The Tampa Palms Owners Association also has a lien on the property for unpaid dues."

"The Hamptons has 315 units, and they were the priciest conversions in New Tampa. As of this summer, Bay Communities had sold just 70 units. With 13 condo conversions in one year, most New Tampa developers gave up and started leasing the units again."

The Palm Beach Post. "Florida led the nation in foreclosure activity for the third quarter of this year as adjustable rate mortgages came home to roost, a report shows. The number of households in foreclosure throughout the state spiked 55 percent compared with the second quarter of this year, and rose 26 percent over the third quarter of 2005."

"In Palm Beach County, one in every 153 households was in foreclosure in the third quarter, up 26 percent over the third quarter of 2005. Foreclosures rose 38 percent over the previous quarter."

"St. Lucie County foreclosures jumped 68 percent over the same quarter a year ago, and 65 percent over the second quarter of this year."

The Review Journal reports from Las Vegas. "Looking for an affordable home? Your chance to buy a foreclosed home at below-market value in Las Vegas comes Nov. 19 at the JW Marriott. Hudson & Marshall is offering nine Las Vegas homes valued from $275,000 to $460,000. They're among more than 100 homes on the block in the foreclosure-battered states of Colorado and Nevada."

"The homes are 'real estate owned,' or REO, property taken back by national lending institutions and asset management companies after every effort was made to work with the borrower. 'Posting a foreclosure doesn't necessarily mean foreclosure,' principal Dave Webb said. 'These homes are in foreclosure, not default. Realtors have already had their shot at (selling) them.'"

"Rising interest rates have forced many homeowners with adjustable-rate mortgages to default on their loans because they no longer can afford the rising mortgage payments, Webb said."

"'We've had some large sales in Las Vegas. I'd say we did two to three (auctions) a year in Vegas from 1999 to about 2003 with a big inventory, 40 to 50 homes,' he said. 'Then the market took off. You were building like crazy. There were very few foreclosures from then until about the last six months.'"

Monday, November 06, 2006

Banks Hiding Defaults At Auctions: Australia

The World Today from Australia. "On any Saturday in Western Sydney, banks and other lenders can now be found selling off the dreams of dozens of homeowners. Real estate agents who've worked in the stricken areas for a generation say they've never seen anything like it, even during three recessions."

"In a move, as we heard introduced by nearly every bank and non-bank lender in the past few months, real estate agents are now being told to hide the fact that properties being sold are repossessed after failed mortgages."

"The World Today's Michael Edwards reports on a single day he spent watching the sell-off that marks the move from boom to bust in Sydney's outer suburbs. If you were to listen to the auctioneer, as he dismissed some small bids, the house is an opportunity to make money."

"But the contract for sale tells a different story. This house, like many others being auctioned today, is empty. The people who took out a mortgage to live here have been moved on."

"The seller is the institution who wrote them their loan, have now taken their house back. The World Today has established that in Sydney alone as many as 20 homes a week go under the hammer as mortgagee sales."

"But the sell-off of seized properties started much earlier this Saturday, in Chester Hill, where 8 Mountview Avenue sold for $410,000. Its owner had bought it for $25,000 more than that, and pumped tens of thousands of dollars into improvements, before failing to make his mortgage repayments and losing it to his lender."

"By midday, when The World Today arrived at this auction in Castle Hill, in Sydney's north-west, half a dozen places had already been put under the hammer. The steady stream continued throughout the afternoon. All of them, whether advertised as so or not, were mortgagee auctions."

"The World Today has uncovered a new and deliberate policy by banks and non-bank lenders, to hide the fact that auctions were the result of defaulted mortgages. Several real estate agents explained the policy had been introduced by lenders in the past few months as repossessions spiked, and that sensitivity is reflected in a policy that saw The World Today barred from two other mortgagee auctions in Sydney's north-west on this same Saturday."

"In fact, one Sydney real estate agent told the program that he estimates nine out of 10 auction sales in outer western areas of Sydney are now the results of mortgage defaults. In the battler suburbs on the city's fringes, it's turned on its head the notion that buying a home used to deliver status and security."

Saturday, November 04, 2006

100 Colorado Homes To Be Auctioned Off

A notice of auction from Colorado. "Hudson & Marshall is planning to auction more than 100 homes in foreclosure-flooded Colorado and Nevada on November 16, 18, and 19. Increasing interest rates have led to the steep increase in defaulted home loans in these areas. But these foreclosures, in turn, could lead to more opportunities for potential home buyers."

"Some say auctions actually make the process of purchasing a home more fair, due to the lack of negotiations and contingencies. Plus, sellers guarantee clean titles on all properties, which ensures the houses are free of any liens or back taxes."

"Hudson & Marshall will start auctioning the REOs, which are valued from $25,000 to more than $430,000, in Colorado Springs on the 16th. The second stop will be in Denver on the 18th, and the last auction will be held in Las Vegas on the 19th."

"The auctions for the homes, which are owned by leading financial institutions and asset management companies, will occur at the actual properties. And the highest bidder is only required to pay 5 percent or $2,500 down—whichever is greater—by personal check, making the sell a relatively simple process."

"'From listing to closing, real estate auctions accelerate the sales process for sellers. Using an aggressive marketing program, Hudson & Marshall secures maximum exposure for properties and closes multiproperty sales in less than 30 days, reducing the time homes linger on the market,' said Dave Webb, principal, Hudson & Marshall."

"'The auction method is a win-win for lenders and asset management companies who are able to swiftly move large volumes of foreclosed properties and avoid the high carrying costs on these assets.'"

Wednesday, November 01, 2006

Filings Ramp Up In Alabama

The Birmingham News from Alabama. "Foreclosure filings in Alabama rose 27 percent in the third quarter from the same period a year ago, according to a California firm that operates an online foreclosure marketplace. RealtyTrac said there were 1,215 foreclosures in Alabama in the July-to-September period. The number increased every month in the period, 307 in July, 379 in August and 529 in September."

"The figure was 26.83 percent higher than the third quarter of 2005 and 32.93 percent higher than the previous three-month period, RealtyTrac said."

"'What our third-quarter research appears to be showing is that the first wave of adjustable rate mortgages is having a negative impact on the number of homes going into foreclosure,' said RealtyTrac CEO James J. Saccacio."