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Redefining the flip: Foreclosure-to-rental conversions increase

WASHINGTON – Gene Richards is a lifelong Vermonter, but on a recent weekday afternoon he found himself back on Florida’s west coast, scouting foreclosures to add to the collection of rental properties he has amassed in the wake of the housing crisis.

“I just started buying them and I haven’t stopped. I have 15 right now, and I’d buy another 15,” said Richards, 51, who runs a mortgage company and also owns rental properties back home in Burlington, Vt. “This to me is a no-brainer of an investment.”

With home prices at historic lows and rental rates on the rise, Richards and a growing number of investors with cash to spare are seeking lucrative returns by gobbling up foreclosures in distressed markets across the country and turning them into rentals.

“The investors are seeing bargain opportunities,” said Lawrence Yun, chief economist for the National Association of Realtors. “The numbers are just very attractive, given the alternatives.”

One way to identify investment house buying is all-cash sales. In Pierce County, almost half of the closed sales for the past year have been paid for in cash, according to data from Redfin, a Seattle-based online real estate company.

“There’s a lot of reasons why people might pay cash,” Tim Ellis, a Redfin real estate analyst, told The News Tribune last week.

Ellis draws the line at around $300,000 – people paying cash for homes above that amount are people buying a personal residence.

In King County, it’s “people hired by Google, Facebook, Amazon – (companies) who are hiring a lot and paying well,” he said.

“Below $300,000 is investors.”

According to the Northwest Multiple Listing Service, the average sale price for a home in Pierce County in March was $178,925.

The real estate data firm CoreLogic estimated in a report this month that the burgeoning foreclosures-to-rental business could become a $100 billion industry this year as bigger and bigger investors get involved in hard-hit markets from Florida to California to Arizona to the Midwest.

Yun cited to a recent NAR survey that shows sales of investment homes soared nearly 65 percent in 2011 over the previous year. By contrast, the number of purchases by owners who intended to occupy the homes fell more than 15 percent, the survey showed.

Those numbers reflect the fact that investors often have the ability to purchase in bulk and with cash, bypassing the need to rely on credit approval from banks. But the survey also suggests that the combination of bargain prices and a steady stream of rental income seems more attractive to many investors than having their money languish in banking accounts or bonds.

Of course, the speculators who furiously acquired properties and flipped them in search of quick profits played a key role in fueling the housing bubble that wrecked the U.S. economy. But for the moment, Yun believes, the current investor boom in turning foreclosures into rentals could actually help to heal the ailing housing market.

“In the current market situation, I would say the investors are very helpful. … We don’t want to see foreclosed properties linger. The investors are clearing this inventory out of the system,” Yun said. “Investors during the bubble years were not helpful; they were just adding fuel to the fire. But now they’re playing a stabilizing role.”

In the past, the investors willing to buy up bank-owned, single-family homes and turn them into rentals predominately were individuals or mom-and-pop outfits with only a handful of properties. That’s still the case, but larger players have entered the business, and even larger ones – including hedge funds and private equity firms – have said they plan to invest hundreds of millions of dollars in such properties.

In California, Waypoint Homes has amassed about 1,300 rental houses in California since the business began in 2008 and has begun expanding into Phoenix.

“We’re not looking at this as a short-term opportunity in a distressed market,” said Waypoint co-founder Colin Weil, noting that some large hedge funds and private equity funds are currently looking to spend hundreds of millions of dollars going into the single-family rental business. “There’s so much big capital that’s so eager to get into this space. … It’s the emergence of an enormous industry.”

In the Washington area, investor Dan Magder recently left his job with the private equity firm Lone Star Funds to start the Washington D.C.-based Rock Creek Capital Group and focus on the single-family rental business. He has partnered with Greenlet Investments of Texas that owns hundreds of homes throughout the South, and he expects to spend as much as $200 million in coming years buying foreclosures, renovating them and renting them out.

“There are a tremendous amount of these homes that are going to be sitting there. At the same time, you have many people who were in these homes who are looking for a place to live,” Magder said, adding that between rising rents and low vacancy rates, “the financial proposition starts to look good.”

Banks and lenders currently own 634,282 distressed properties across the country, a 16-month supply at the current sales pace, according to RealtyTrac. Another 717,874 properties are in the foreclosure process but have not yet been repossessed.

In February, the federal agency that oversees government-backed mortgage giants Fannie Mae and Freddie Mac announced its intention to hold bulk sales of about 2,500 foreclosed homes in some of the nation’s hardest hit areas, such as Las Vegas, Chicago, Atlanta and parts of Florida. The program could expand if successful.

The following month, Bank of America announced that it will test a pilot program to allow as many as 1,000 struggling homeowners to hand over the deed but stay in their homes and rent from the firm. The bank said it will work with property management companies to maintain the homes and eventually sell them to investors.

Some housing advocates say that the idea of hedge funds and other large investors becoming large-scale landlords raises red flags. Will they abide by fair housing laws? Will they actually maintain the homes or just slap on a coat of paint and ignore tenants until it’s time to sell?

“It’s a whole different thing than an apartment building, where all of your tenants are in one place. The fact that you have properties that may be scattered across a metropolitan area has its own set of challenges,” said Debby Goldberg, special projects director for the National Fair Housing Alliance. “We’ve never been in this kind of situation before where you have so many vacant properties in so many places.”

The Federal Reserve itself recently issued a policy statement about bank-owned rental properties in which it urged banks to hire only reputable vendors and to comply with all landlord-tenant laws and property maintenance provisions.

Investors such as Weil and Magder say they are aware of the potential problems and are using updated technology and infrastructure to make sure their properties are well maintained and their tenants well treated.

“The onus is on us to be effective stewards of these assets,” Magder said. “We’re dealing with real people and their lives, and you have to be sensitive to that. … It’s actually the right business proposition, but it’s definitely the right thing to do.”

It’s a business proposition that isn’t likely to lose steam anytime soon.

Richards, the investor from Vermont, says he has no plans to cease his regular trips to Florida. Unlike the cavalcade of speculators who flocked to the state during the boom years to make a quick buck, he said he intends to be a responsible landlord and watch his investment grow over time.

“It isn’t about the flip for me,” he said of the foreclosures he has purchased. “I really like fixing them up. I feel like I’ve helped stimulate the economy down here. I don’t want to be the one who continues to hurt it.”

News Tribune staff writer Kathleen Cooper contributed to this report.

Article source: http://www.thenewstribune.com/2012/04/29/2124964/redefining-the-flip.html

Foreclosed Homes Destroyed By Previous Owners (VIDEO)

Foreclosed Homes

Home owners who have had their houses taken away in foreclosure sometimes take their anger out on the houses themselves.

WTEV reports on a foreclosed mansion in Jacksonville, Fla. in which the previous owners have apparently ripped out the home’s cabinets, light fixtures and appliances.

With millions of Americans still facing foreclosure, the phenomenon of homeowners ransacking their houses on their way out may only continue. In Florida, one in every 336 housing units received a foreclosure filing in March, according to RealtyTrac.

The glut of foreclosures across the country is weighing on property values, and with former homeowners leaving their houses completely stripped, the houses are likely to drag down neighboring property values even more. Foreclosed homes weigh on neighboring properties more than vacant homes, according to an October report from the Cleveland Federal Reserve.

Evicted homeowners ransacking their houses isn’t all that uncommon. KVUE reported on a similar situation in Texas.

“They’re mad at the bank so they take it out on the house,” George Roddy, of the Addison based Foreclosure Listing Service, told KVUE.

Ransacked or not, foreclosed homes weigh on their surrounding neighborhoods. Properties that are occupied, but in foreclosure, drive down the surrounding property values twice as much as vacant properties, an study from last October found. In the coming year, ABC reports, American taxpayers will spend more than $40 million just to keep the lawns of America’s foreclosures mowed.

The Prudential American Group says on its site that homeowners who intentionally damage their homes after foreclosure could face lawsuits.

Check out these additional bizarre foreclosure stories:

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Article source: http://www.huffingtonpost.com/2012/04/29/foreclosed-homes_n_1461533.html

State Supreme Court sides with Nelson couple over foreclosure

LYNCHBURG — The Supreme Court of Virginia ruled in favor of a Lovingston-area couple in their fight against the foreclosure of their property.

On April 20, the court decided the lender failed to comply with terms of the mortgage taken out by Richard M. and Karin L. Mathews that required a face-to-face meeting before beginning the foreclosure process. It also overturned Circuit Judge Michael Gamble’s ruling that the meeting wasn’t required under U.S. Department of Housing and Urban Development regulations because the mortgage company’s offices were too far away.

Court records show the Mathewses fell behind on their loan payments and the holder of their note, PHH Mortgage Corp., appointed another company to begin foreclosure.

A foreclosure sale was set for early November 2009. The day before the sale, the couple filed a complaint in Nelson County Circuit Court to stop it, noting PHH representatives were required to meet with them at least 30 days before beginning foreclosure but did not.

The mortgage company responded under Virginia common law, the person who first breaks a contract cannot sue to enforce it. It also said it was excluded from the meeting requirement because HUD had determined it was only required if the lender had a servicing office within 200 miles of the mortgaged property. The company had no such office. Gamble agreed, and dismissed the Mathewses’ complaint in February 2011.

The Supreme Court of Virginia agreed in October to hear an appeal.

An opinion rendered by Justice William Mims reverses both of the circuit court rulings and sends the case back to be reheard.

The Mathewses and the attorney for PHH Mortgage Corp. could not be reached for comment. The Mathewses’ attorney declined to comment about the decision. Although the couple could not be reached, Nelson County records show they still own a home in the Lovingston area.

The justices opined that under a similar 2008 case, lenders must comply with all terms in a contract leading up to foreclosure and nonpayment of a mortgage is not the sort of material breach precluding borrowers from seeking to enforce the terms.

The HUD meeting requirements were incorporated into the couple’s loan because it was backed by the Federal Housing Administration. Under the regulation, the meetings are not required if the mortgaged property is not within 200 miles of a lender’s branch office.

HUD, however, attempted to limit the definition of “branch” office to be a servicing office with staff trained to discuss options with the borrower behind on his payments. Department interpretations noted many “branch” offices are not staffed with properly trained employees.

“The regulation itself does not support this limitation,” Mims wrote. “To accept HUD’s interpretation would amount to allowing it to create a new regulation or tacitly amend [the regulation] without following the proper statutory procedure.”

The court noted borrowers should be able to travel to a lender’s branch office and meet with properly trained employees via tele- or videoconference.

A re-hearing of the issue in Nelson County has not yet been set. A HUD spokeswoman had no comment about the ruling except to say the department is studying it.

Dumond reports for The News Advance in Lynchburg.

Article source: http://www2.dailyprogress.com/news/2012/apr/28/state-supreme-court-sides-nelson-couple-over-forec-ar-1876803/

Real Estate Q&A: Sale contract won’t stop foreclosure

QUESTION: I listed my home for a short sale in October and recently received a contract from a buyer. I’m waiting for the bank’s approval. At the end of March, I was served with foreclosure papers. How is this possible if I have a contract on the property?

-Christine

ANSWER: This happens quite often. It’s a common misconception that the lender won’t file a foreclosure lawsuit against you if you are negotiating a short sale or loan modification. You should expect to get served with a foreclosure lawsuit four months or so after you stop making mortgage payments. When you try to complete a short sale, it often takes a month or two to get it under contract and 45 to 90 days to get an approval from the lender. If you fail to respond to the foreclosure within 20 days, you will be in default and will have waived valuable rights in defending the lawsuit in case the short sale falls through. I recommend that you see an attorney about responding to the lawsuit.

Q: Can I quit-claim my house to my daughter without notifying my mortgage lender?

-Elizabeth

A: No, at least not without breaking the terms of your mortgage loan. Most loans have a “due on sale” clause that states that if you transfer the property, you need to immediately pay back the full balance. So while there is nothing stopping you from deeding the house to your daughter, if your lender finds out, it can sue you and your daughter to foreclose the home. It is a much better idea to try to get your bank’s permission, or have your daughter buy it from you using a new loan.

Q: When a short sale or foreclosure is sold, what happens with the remaining balance?

-Kristie

A: In Florida, you still owe it. When you borrow money to buy a house, your mortgage loan has two components: the mortgage and the loan. The loan is your promise to pay your bank the money that you borrowed from it, usually called the “promissory note.” The mortgage is the document that you sign to pledge your new home as collateral that the bank can take back, or “foreclose” in order to help it get paid back.

In most states, if the value of the collateral at the foreclosure is not enough to pay back the loan, the borrower will still owe the rest of the money necessary to pay back the loan. This is called the “deficiency,” and the bank can get a judgment for the balance and can collect that from you like any other judgment.

Q: I want to help my daughter buy a townhome in Florida. It will be her primary residence. If I were to be a co-borrower on the mortgage loan, can she still claim the homestead exemption?

-Andy

A: Yes, she can still claim the homestead exemption as long as she otherwise qualifies. Some lenders will require you to also be on the title to the home in order to qualify for the loan. This varies, so you may want to shop around to find the loan that suits your situation.

ABOUT THE WRITER:

Gary M. Singer is a Florida attorney and board-certified as an expert in real estate law by the Florida Bar. He is the chairperson of the Real Estate Section of the Broward County Bar Association and is an adjunct professor for the Nova Southeastern University Paralegal Studies program. Send him questions online at http://sunsent.nl/mR20t7 or follow him on Twitter @GarySingerLaw.

The information and materials in this column are provided for general informational purposes only and are not intended to be legal advice. No attorney-client relationship is formed. Nothing in this column is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction.

Article source: http://www.kentucky.com/2012/04/26/2165211/real-estate-qa-sale-contract-wont.html

Canceled foreclosure sales saddle neighbors, HOAs with expenses

Kathy Lane envisioned a picturesque neighborhood with tree-lined streets when she moved to FishHawk Ranch in 2004.

These days, she stares at an eyesore.

Two doors away, the back yard of an abandoned home overflows with trash; rain pours in open windows; weeds have overgrown the lawn. The pool, filled with black muck, draws swarms of bugs.

“I was expecting well-kept yards,” Lane said. “I live two doors from a dump. If it goes up in flames and catches our house on fire, who is responsible?”

The foreclosure crisis has littered the region with thousands of abandoned homes. The houses sit idle as banks have been slow to seize them in the final stage of the foreclosure process, the public auction.

Although recent headlines proclaim the worst of the housing crisis is over, the decrepit homes are a constant reminder that cleaning up the foreclosure mess remains a work in progress.

The house on Lane’s street in Lithia went into foreclosure in 2008 and has been vacant for more than a year. Aurora Loan Services had set an auction for February but canceled it.

It’s an oft-repeated pattern.

In the last 12 months, lenders have canceled auctions on 4,204 properties in Pinellas and Hillsborough counties. Sales have been canceled two, three, even nine times on some homes.

In many cases, banks delay seizures to avoid having to pay maintenance bills or homeowner association fees. Meanwhile, neighbors fend off vandals and thieves and worry about property values falling because of the deteriorating houses.

The repeated cancellations burden the court system.

“These never seem to go away,” said Thomas McGrady, chief judge of the Pinellas-Pasco County Circuit. “It’s a nuisance.”

Taxpayers also pay for the delays.

Hillsborough Circuit Judge Herbert Baumann Jr. said the Clerk of Courts’ workers spend hours filing paperwork when banks repeatedly cancel auctions.

“It does create more work,” he said. “Clerks do expend a lot of resources on this.”

• • •

No neighborhood is immune.

Even the tony streets in Tampa’s Avila and St. Petersburg’s Snell Isle have “lost houses.”

While the homes sit in limbo, homeowners associations lose money when lenders delay taking titles. The associations may mow lawns and make minor repairs, but that forces other residents to shoulder higher assessments.

Associations have few options to force lenders to sell the homes.

HOAs can seize properties through foreclosure when owners stop paying monthly assessments. Some go a step further by renting out the seized properties to recoup lost dues. Still, those actions cost the associations thousands in legal fees.

Lane, the FishHawk Ranch resident, is baffled by the banks’ inaction.

“Every day you expect a poltergeist,” she said. “We have to live here.”

She isn’t alone.

Tampa-based Rizzetta Co. manages more than 100 community associations with 32,000 homes in Florida, including most associations in FishHawk Ranch. The firm has been deluged in recent years with calls about the abandoned homes and delinquent assessments.

Pete Williams, a Rizzetta manager, attributes the canceled auctions to money.

“The banks never want to take ownership,” he said. “They have to pay the fees going forward. The costs are considerable.”

Even McGrady, the Pinellas-Pasco judge, believes money is behind the canceled sales.

“After a while, you begin to question their motives,” the judge said.

• • •

On the flip side, some experts contend that the banks’ slowness helps stabilize the real estate market. Putting thousands of homes for sale at once could depress prices. Letting them trickle to the market brings higher prices.

And some cancellations occur because lenders and homeowners agree to loan modifications or because homeowners and defense attorneys find errors in bank documents.

The cancellations are currently down in Hillsborough and Pinellas. But that’s because lenders halted foreclosures in late 2010 amid allegations they used robo-signers and false documentation to speed up the foreclosure process.

Still, the delays have allowed some owners to live free for years and dodge assessments.

In June 2009, a Pasco judge granted U.S. Bank a final judgment to seize a home in the Valencia Gardens subdivision in Land O’Lakes. U.S. Bank scheduled the auction for September 2009 but has canceled it eight times. The most recent cancellation occurred last month.

The homeowners have lived in the home but have not paid dues to the Valencia Gardens Homeowners Association. The association is objecting to the cancellations and has asked a judge to order the bank to sell the home. Eight delinquent homeowners owe the association $56,000.

The shortfall has forced the HOA to convert water fountains into flower beds and to scale back on other projects, said Gail Spector, the president.

The group began cracking down on delinquent residents last year by threatening foreclosure lawsuits against them. Spector knows residents have lost jobs but said other homeowners shouldn’t be burdened with the unpaid dues.

“You have to treat everybody the same,” Spector said. “We are fixing and paying for everything. That’s not fair.”

Leonard J. Mankin, a Clearwater-based law firm, represents hundreds of associations across Florida. Attorney Brandon Mullis has asked a judge to sanction U.S. Bank and to force the sale of the home in Valencia Gardens.

It is now common, he said, for banks to cancel auctions seven or eight times in many foreclosure cases.

Mullis questions why lenders file court documents saying they are “negotiating or reviewing for possible loss mitigation options” when the houses have been vacant a year or longer.

He is fighting another case in Palm Harbor. The Bank of New York Mellon has canceled seven auctions — even though the homeowner defaulted on the mortgage in 2008. The bank canceled the seventh auction in February because it wanted to exhaust options to prevent the foreclosure.

Mullis scoffed.

“This action leaves the burden to fall on those neighboring residents who are forced to pay higher assessments while the property next door further deteriorates,” he said.

The Florida Bankers Association disagrees.

Anthony DiMarco, executive vice president, said lenders are overwhelmed with thousands of foreclosures and aren’t cancelling sales to skirt maintenance and assessments.

“They are trying to move cases forward,” he said. “We’d rather keep people in homes.”

Mark Puente can be reached at mpuente@tampabay.com or (727) 893-8459. Follow him at Twitter at twitter.com/markpuente.

Article source: http://www.tampabay.com/news/business/realestate/canceled-foreclosure-sales-saddle-neighbors-hoas-with-expenses/1227340

Torrent of Portland-area foreclosures reach market at a trickle

It’s called Mark to Fantasy. Because of our Government currently giving the Banks free reign to mark assets on their books at any value they chose – and not following proper GAAP/FASB accounting standards of marking assets to real market value – the Banks can keep these over valued assets on their books for as long as they want and value the asset at what their original assessed value was at the time of the loan.

If Banks needed to Mark to Market in the real world, our Banks would be under collateralized and insolvent. BofA and others would simply have most of their Mark to Fantasy book value assets wiped out.

The minute they sell the home, they have to book the actual value and show huge losses on their books. Since it looks like the Government is being successful in re-inflating the housing bubble, why would they sell today when they potentially can get a better value in a year or two?

Even if they know the house will decline in value due to neglect, if they can use the higher valued Mark to Fantasy book value to continue to borrow from the Fed and make 20-30% in other operations, while watching their real asset of the house decline by say 10% a year – they are still way ahead of the game by not having to book the 50% loss of the loan to asset value at the time of selling the property.

Don’t expect to see these foreclosures on the market any time soon, with the current Mark to Fantasy rule working so well for them cash flow wise, they have no incentive to sell the property at all. Only when the Government forces Banks to return to true GAAP accounting will we see these properties be cleaned out.

Article source: http://www.oregonlive.com/front-porch/index.ssf/2012/04/portland-area_foreclosures_rea.html

Foxborough’s Foreclosures Drop in March

The number of completed foreclosures in Foxborough, dropped from three in March 2011 to two last month, while deeds were up from one to two.

The data was compiled by real estate information firm The Warren Group.

The state saw a 55 percent increase in foreclosure petitions, with 1,621 in the month, up from 1,048 in March 2011. Massachusetts has had a 71.5 percent increase in petitions in the first quarter.

Massachusetts foreclosure deeds also saw a jump, with 856 last month, up from 627 last year (a 36.5 percent increase). For the first quarter, the state has seen a 34.4 percent rise.

Warren Group CEO Timothy Warren said in a statement that the increase in the state is not unique.

“Banks are stepping up foreclosures all over the country, and Massachusetts is no exception,” he said. “Since the suit by state attorneys general over foreclosure abuses has been settled, a cloud has lifted and we may see numbers continue to rise.”

Here are the foreclosure statistics for area towns:

  • Dover’s foreclosure petitions and deeds were both steady at zero for the month.
  • Easton had a substantial increase in foreclosure petitions, jumping from three last year to 11 last month. Deeds, however, fell from four to two over the same time frame.
  • In Foxborough, foreclosure petitions dropped from three in March 2011 to two last month, while deeds were up from one to two.
  • Mansfield saw a big jump in foreclosure petitions, from two last year to seven in March. Deeds increased as well, from zero to two.
  • Medfield’s foreclosure petitions were steady at one for March, while deeds climbed from zero to one.
  • Norfolk’s foreclosure petitions were at one for both March 2011 and March 2012, while deeds jumped from zero to three.
  • Norton’s foreclosure petitions were steady at three for the month, and deeds fell from four to zero.
  • Norwood had its foreclosure petitions drop slightly, from six to five, while deeds jumped from one to two.
  • Plainville foreclosure petitions remained at three year-over-year and deeds were steady at one.
  • Foreclosure petitions in Sharon jumped sharply, going from zero to five, while deeds were up from one to two.
  • Stoughton’s foreclosure petitions climbed from four to 13, while deeds were steady at two.
  • Wrentham’s foreclosure petitions three foreclosure deeds (or completed foreclosures) in the month, up from zero in March 2011. Foreclosure petitions (which represent newly started foreclosures) fell from five to one year-over-year.

Article source: http://foxborough.patch.com/articles/foxborough-s-foreclosures-drop-in-march

Short sellers seeking to avoid foreclosure will get faster replies from banks

None of this is typical of short-sale procedures today. Banks and servicers that don’t comply will face monetary and other penalties.

The mandatory timelines, which real estate and mortgage industry experts say should help speed up what traditionally has been a glacial process, are being imposed by the Federal Housing Finance Agency, the regulatory overseer of Fannie and Freddie in conservatorship. Short sales, an important alternative to foreclosure, involve the lender or loan servicer agreeing to accept less than the full amount owed by the borrower.

Though they can be complex and messy — and can take anywhere from several months to more than a year to complete — short sales are turning into a mainstay of the real estate market.

According to a report from the foreclosure data firm RealtyTrac, short sales jumped by 33 percent in January compared with the same month the year before. In 12 states — including California, Arizona, Colorado, Florida, New York and New Jersey — there were more short sales recorded during January than sales of foreclosed properties.

This trend is welcome, say regulators, but the time required to complete short sales is still far too long. The 30-day and 60-day mandates address just one of the key points of delay in the process, but regulators promise a series of additional steps in coming months to speed transactions. They include clearer guidelines on borrower eligibility, property valuations, compensation for lenders holding second liens and mortgage insurance issues. All of these are points of friction that can delay a short-sales agreement for weeks or months.

Realty agents who specialize in short sales say setting mandatory timelines is a step in the right direction but won’t solve all the problems. The new rules and promises of more “are great if they really happen,” said broker Erik Berry of Erik Berry and Associates in Sacramento, Calif. Short sales that his firm handles take an average of “about six months” from start to finish on Fannie-Freddie loans. But FHA transactions, which will not be affected by the new regulations, average much longer, and sometimes drag on for a year.

Berry also is skeptical that banks and servicers will be able to reform their staffing practices quickly enough to meet the compressed timelines, even if penalties are imposed.

In some cases, he said in an interview, banks switch personnel and negotiators five or six times over the course of a short sale. “You’re dealing with one person one day, and they say, ‘Don’t worry, everything’s fine,’ then suddenly they’re gone and you never hear from them again,” leaving the deal stalled for weeks.

Matt Battiata, whose Battiata Real Estate Group in Del Mar, Calif., handles hundreds of short sales a year, said a reliable, 60-day decision deadline for responses to offers will be helpful — 30 days better than the 90-day average he now sees from banks — but the whole process will still take longer than traditional sales. For clients seeking to do short sales today, Battiata estimates five to six months from offer to closing. After June, assuming the new federal rules and penalties work, the process might be shortened by only a month.

On top of this, some of the complications inherent in short sales are beyond the control of regulators or banks, he pointed out. For instance, buyers put in offers to purchase but then change their minds, forcing the sellers and brokers to come up with replacement offers, and causing the bank to reset the clock to analyze the new package.

The takeaway for potential short sellers: Be aware of the new moves afoot to streamline the process, but don’t expect miracles.

Ken Harney’s e-mail address is kenharney@earthlink.net.

Article source: http://www.washingtonpost.com/realestate/short-sellers-may-benefit-from-policy-change/2012/04/26/gIQAGseVmT_story.html

Lovingston couple wins state Supreme Court case

The Supreme Court of Virginia ruled in favor of a Lovingston-area couple in their fight against the foreclosure of their property.

On April 20, the court decided the lender failed to comply with terms of the mortgage taken out by Richard M. and Karin L. Mathews that required a face-to-face meeting before beginning the foreclosure process. It also overturned Circuit Court Judge Michael Gamble’s ruling the meeting wasn’t required under U.S. Department of Housing and Urban Development regulations because the mortgage company’s offices were too far away.

Court records show the Mathewses fell behind on their loan payments and the holder of their note, PHH Mortgage Corp., appointed another company to begin foreclosure.

A foreclosure sale was set for early November 2009. The day before the sale, the couple filed a complaint in Nelson County Circuit Court to stop it, noting PHH representatives were required to meet with them at least 30 days before beginning foreclosure but did not.

The mortgage company responded under Virginia common law, the person who first breaks a contract cannot sue to enforce it. It also said it was excluded from the meeting requirement because HUD had determined it was only required if the lender had a servicing office within 200 miles of the mortgaged property. The company had no such office. Gamble agreed, and dismissed the Mathews’ complaint in February 2011.

The Supreme Court of Virginia agreed in October to hear an appeal.

An opinion rendered by Justice William Mims reverses both of the circuit-court rulings and sends the case back to be reheard.

The Mathewses and the attorney for PHH Mortgage Corp. could not be reached for comment. The Mathews’ attorney declined to comment about the decision. Although the couple could not be reached, Nelson County records show they still own a home in the Lovingston area.

The justices opined that under a similar 2008 case, lenders must comply with all terms in a contract leading up to foreclosure and nonpayment of a mortgage is not the sort of material breach precluding borrowers from seeking to enforce the terms.

The HUD meeting requirements were incorporated into the couple’s loan because it was backed by the Federal Housing Administration. Under the regulation, the meetings are not required if the mortgaged property is not within 200 miles of a lender’s branch office.

HUD, however, attempted to limit the definition of “branch” office to be a servicing office with staff trained to discuss options with the borrower behind on his payments. Department interpretations noted many “branch” offices are not staffed with properly trained employees.

“The regulation itself does not support this limitation,” Mims wrote. “To accept HUD’s interpretation would amount to allowing it to create a new regulation or tacitly amend (the regulation) without following the proper statutory procedure.”

The court noted borrowers should be able to travel to a lender’s branch office and meet with properly trained employees via tele- or video-conference.

A re-hearing of the issue inNelsonCountyhas not yet been set. A HUD spokeswoman had no comment about the ruling except to say the department is studying it.

Article source: http://www2.newsadvance.com/news/2012/apr/27/lovingston-couple-wins-state-supreme-court-case-ar-1875213/

Golden Phoenix Provides Update on Preliminary Injunction


LAS VEGAS, NV, Apr 27, 2012 (MARKETWIRE via COMTEX) –
Golden Phoenix Minerals, Inc. (“Golden Phoenix” or the “Company”)



/quotes/zigman/184535/quotes/nls/gpxm GPXM
-19.89%



announced today that on April 26, 2012, the Court
denied the Company’s request for a preliminary injunction to stop the
foreclosure and sale of the Company’s 30% interest in the Mineral
Ridge Gold, LLC, the joint venture entity that owns and operates the
Mineral Ridge Gold Project in Nevada.

The balance of the issues in the lawsuit including conversion of
property, accounting, breach of the covenant of good faith, fair
dealing, and others are now ready to move forward through the normal
litigation process, and the Company intends to prosecute the case
vigorously to obtain the full benefit of all legal rights and
remedies for its shareholders.

As part of the Court proceedings it was disclosed that a National
Instrument (“NI”) 43-101 Technical Report on the Mineral Ridge Gold
Project, Nevada, was prepared by SRK Consulting (U.S.) Inc. (“SRK”)
for Golden Phoenix and has been filed on SEDAR.com.

Please visit the Golden Phoenix website at:
www.goldenphoenix.us .

About Golden Phoenix: Golden Phoenix Minerals, Inc. is a Nevada-based
mining company whose focus is Royalty Mining in the Americas. Golden
Phoenix is committed to delivering shareholder value by identifying,
acquiring, developing and joint venturing gold, silver and strategic
metal deposits throughout North, South and Central America. Golden
Phoenix owns, has an interest in, or has entered into agreements with
respect to mineral properties located in the United States, Canada,
Panama and Peru including its 30% interest in the Mineral Ridge gold
project near Silver Peak, Nevada, and its 15% interest in Golden
Phoenix Panama, S.A., the joint venture entity that owns and operates
the Concessions constituting the Santa Rosa gold mine.

Forward-Looking Statements: Information contained herein regarding
optimism related to the business, expanding exploration, development
activities and other such statements are “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act of
1995 and are subject to the safe harbors created thereby. While
Golden Phoenix believes such statements are reasonable, they are
based on current expectations, estimates and projections about the
Company’s business and are not guarantees of future performance and
involve certain risks and uncertainties that are difficult to
predict. Actual results could vary materially from the description
contained herein due to many factors including continued market
prices for the Company’s mineral products, domestic and international
business and economic conditions, and other risk factors listed in
the Company’s Securities and Exchange Commission (SEC) filings under
“risk factors” and elsewhere. The Company does not undertake any
obligation to update any forward-looking statement to reflect events
or circumstances after the date of this press release.


        For More Information Contact:
        Robert Ian
        Director of Corporate Communications
        (702) 589-7560
        investor@goldenphoenix.us

SOURCE: Golden Phoenix Minerals, Inc.


        mailto:investor@goldenphoenix.us

Copyright 2012 Marketwire, Inc., All rights reserved.

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Article source: http://www.marketwatch.com/story/golden-phoenix-provides-update-on-preliminary-injunction-2012-04-27