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Congressman provides a voice for those facing foreclosure

BALTIMORE — U.S. Rep. Elijah E. Cummings doesn’t need to go farther than his front stoop to see the scars of the housing crisis.

“That one was foreclosed on,” the 61-year-old Maryland Democrat said on a recent morning outside his brick row house in this city’s Madison Park neighborhood, pointing to an empty house nearby with a “No Trespassing” sign in the front window.

“That house has been vacant now at least nine months,” he said, nodding across the street toward another home, its windows boarded shut. The owner lost his job and no longer could afford the payments, he said. “He was a good guy.

“This house here was in foreclosure,” Cummings said, pointing farther down the block. “I understand someone just bought it for a song and a dance.”

Every community in the country has felt the sting of the housing bust, which has stretched into its sixth year. But in Cummings’ sprawling district — mostly urban, mostly African American, largely working- and middle-class — the foreclosure wave hit particularly hard.

Cummings has dedicated a substantial amount of time and energy — and outrage — trying to force changes that he says would help stem the ripple effects of the foreclosure epidemic, particularly on minority communities that have suffered disproportionately from the fallout.

In June, he held the seventh foreclosure-prevention workshop in his district. The events bring bank representatives together with struggling borrowers hoping to modify their loans and remain in their homes.

In Washington, D.C., where he is the ranking Democrat on the House Committee on Oversight and Government Reform, Cummings has become one of Capitol Hill’s most outspoken lawmakers on the need for more government aid to troubled homeowners.

He has also emerged as a fervent critic of Edward J. DeMarco, the chief regulator of government-backed mortgage giants Fannie Mae and Freddie Mac, who has resisted proposals that the two firms reduce the amount certain borrowers owe on their mortgages.

Cummings has backed efforts, some more successful than others, to investigate mortgage-related abuses by banks and lenders, to expand foreclosure protections for people in the military and their families and to make it easier for some homeowners to refinance their loans at lower interest rates. He has even done something he rarely does on other topics: criticize the Obama administration, saying it hasn’t done enough to help those in need.

He’s come close himself

When Cummings speaks about the foreclosure crisis, he talks of children displaced and neighborhoods destabilized, of lost pride and lowered expectations, of vanishing wealth, of anxious borrowers being jolted awake at 4 a.m. by worries about making ends meet.

“A lot of people say, let them be foreclosed upon because you are holding off the inevitable,” Cummings said. “I don’t see these folks who are losing their houses as some kind of collateral damage. This is usually their biggest investment in life. This is where they raise their family … The people that come to me, they don’t want a handout, they just want to be able to get through this storm.”

It’s a feeling Cummings himself has known.

In 1997, the company holding his mortgage initiated foreclosure proceedings after he missed six months of payments. He fell behind because of overdue tax bills, medical expenses and child-support payments, according to a Baltimore Sun story that later detailed his financial woes. Cummings also said that giving up his law practice to run for Congress put a dent in his income.

He eventually paid off his bills and caught up on his mortgage, but the brush with foreclosure stuck with him. “That had an impact on me, because I could see how people could slip into a problem like that,” he said.

His efforts to help others facing foreclosure have won Cummings admiration at home.

“I live in his district, and I don’t think homeowners have a better friend in Congress,” said Marceline White, director of the Maryland Consumer Rights Coalition. “You have neighborhoods that are fighting this issue every day. … He’s calling for what absolutely needs to be done.”

Maryland Attorney General Douglas F. Gansler, D, who has also worked with Cummings closely on housing issues in the state, said many Maryland lawmakers have shown interest in helping homeowners, but Cummings “has made it his passion.”

No friend of Issa’s

In D.C., Cummings hasn’t always garnered such praise. He has butted heads repeatedly with House oversight committee Chairman Darrell Issa, R-Calif., as well as with many other House Republicans.

Cummings has repeatedly criticized Issa for not pressing harder to investigate banks and lenders accused of a wide range of foreclosure abuses and for opposing reductions in the mortgage balances of struggling borrowers. Issa says the practice could lead other homeowners to stop paying mortgages in hopes that the government would come to their rescue.

Spokesman Frederick Hill said Issa has held numerous hearings on the foreclosure crisis during the past two years, including one in Cummings’ district.

Hill said Issa doesn’t think anyone has made a convincing case for large-scale principal reductions, and instead prefers other tools such as principal forbearance, which allows borrowers to pay only the interest on a loan for a time. Issa also has argued that delaying foreclosures often postpones getting those homes into the hands of those who can afford them.

“Many of the policies ranking member Cummings have advocated, these are the policies that have extended the length of the foreclosure crisis, rather than letting the market quickly adjust,” Hill said. “They’ve often been giveaways that put the onus on taxpayers.”

DeMarco also has challenged the allegation that he has prevented Fannie and Freddie from reducing mortgage balances solely for ideological reasons.

Cummings acknowledges that his success with the housing crisis has been limited and that he has helped only a fraction of those in need.

“I’ll take a family at a time, because I know that if it were not for certain things that we’re doing, that would have been a family destabilized,” he said. “I’ll take the pieces. I just wish I could do more. I wish we could move even faster.”

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Foreclosure rates fall in Vallejo-Fairfield area – Vallejo Times

Foreclosure rates in Solano County were down slightly in April compared to the same period last year, according to newly released industry data.

This is in reaction to increased employment but may also indicate that some homeowners here are getting wise to the game, a local Realtor said.

The latest CoreLogic data reveals the rate of Vallejo-Fairfield area foreclosures among outstanding mortgages was 3.26 percent in April, down .46 percentage points compared to last April when the rate was 3.72 percent. Foreclosure activity here was lower than the national rate of 3.41 percent for April 2012.

The mortgage delinquency rate here also fell in April, the report shows.

According to CoreLogic data for April, 8.84 percent of mortgages were 90 days or more delinquent compared to 11.30 percent last year — a drop of 2.46 percentage points.

Since 2010, Solano’s highest foreclosure rate was in November of that year, 4.21 percent. The lowest rate here in that time was last February’s 3.23 percent.

Mortgage delinquency rates here topped out at 14.17 percent in January 2010. The lowest since then was last March’s 8.52 percent.

“For me, what I think is happening in our area is we have better employment than we had a year ago, and people have learned how to work with their banks better,” Prudential California Realty’s Linda Cook said. “Some have learned that there really isn’t an option to keep their house, that they are so underwater and don’t have the

income to support the loan, and really should do a short sale, which I think is a credit to Realtors explaining how all that works.”

Cook said she also senses a slight rise in home prices — another piece of good news.

“Certainly, the inventory is way down,” she said. “I hear we’re down to 18 days of inventory. A healthy market is 90 days or so, so we have a huge lack of inventory and lots of buyer demand.”

What so-called “shadow inventory” there is, is smaller than many people think, and is being kept off the market by the slowing of foreclosures, Cook said. Some of these are being snatched up by “savvy people” driven by the world money markets, “to buy real estate in a place where it’s already hit the bottom and is on its way back,” she said.

“But, I think some of those homes are being sold to investors in blocks, in bulk purchases, and some to foreign investors from China, Canada (and elsewhere),” she said. “The big minus of that is that many of these homes are rented out, and I think we could wind up with whole neighborhoods filled with renters instead of homeowners.”

Contact staff writer Rachel Raskin-Zrihen at (707) 553-6824 or Follow her on Twitter at RachelVTH.

Article source:

Investors buying, renting many Oakland foreclosures

Driving down Campbell Street in West Oakland, Neill Sullivan points out a series of homes and apartment buildings he’s purchased since the real estate market collapsed.

In 2008, the 38-year-old founded a company to buy foreclosed Oakland real estate. According to a report released Thursday by the nonprofit Urban Strategies Council, Sullivan’s firms have purchased 171 homes in the city – almost all in West Oakland. Those homes accounted for the second-highest number of foreclosures purchased by investors.

“We focused over here, because at one point many of these houses were boarded up and people weren’t buying,” said Sullivan, who lives in a duplex in San Francisco’s Mission District.

“There was opportunity,” he said.

Sullivan is hardly alone in buying foreclosed homes en masse. According to the Urban Strategies Council’s report, real estate investors have purchased – usually with cash – 42 percent of the 10,508 homes in Oakland that went into foreclosure between January 2007 and October 2011.

Many of these investors are turning the homes into rental properties and charging rent that is significantly higher than the monthly mortgage payments many families would have to make if they purchased the homes.

“They are massive landlords in neighborhoods that historically have had high rates of homeownership, and very few people are aware of the investor activity that’s taking place under their feet,” said Steve King, the organization’s housing and economic development coordinator.

Investor’s 307 buys

Community Fund LLC bought 307 foreclosed homes and apartment buildings, the most purchased by any investor, according to the report. The company is registered to Michael Marr, an Oakland real estate broker who declined to comment for this story. Community Fund paid, on average, $111,000 for a foreclosed home.

Property records show many of the properties purchased by Community Fund and Sullivan’s firms are detached single-family homes that were owner-occupied before foreclosure.

Sullivan’s firms paid an average of $139,000 for a foreclosed home. As of October, those companies had sold 10 of the foreclosed homes they bought, the report said, retaining the balance, primarily as rentals.

“We’ve been a sleeping giant for a while,” said Jeremiah Brennen, a leasing agent with Sullivan Management.

Brennen said he is seeking tenants who would normally prefer San Francisco’s trendier neighborhoods, but who can afford to rent only a small apartment in the city. “We want to bring in good, productive people and really change the area,” he said.

Change not for better?

But not everyone is welcoming that change.

“It has caused a drastic increase in gentrification,” said Marilyn Reynolds, 58, who teaches at a Head Start program in the area. “The neighborhood is changing from black and Hispanic to white. People are being pushed out.”

Sullivan rejects the charge.

“We are not trying to change the fabric of Oakland,” he said. “We value the diversity in Oakland. We are simply trying to rent houses to qualified tenants.”

But some Oakland officials say the focus on rentals is itself cause for concern.

“We have investors who are eating up our neighborhoods for their profits,” said Desley Brooks, an Oakland city councilwoman.

Brooks argued that families that would want to buy the foreclosed properties with conventional financing are being squeezed out by investors who can afford to pay cash. Real estate investors are “taking away the notion of buying into the American dream,” she said.

Cash over loans

In neighborhoods hit hard by the housing crisis, it would be cheaper for many families to buy a foreclosed home than rent an apartment. The average price of a house in those neighborhoods is less than $150,000. Monthly payments on most 30-year mortgages at that price are usually less than $1,000, while rents on many West Oakland properties are around $2,000.

But banks have been reluctant to sell to buyers who purchase with loans, preferring the ease and speed of a cash transaction.

In its report, the Urban Strategies Council, which focuses on development issues in low-income urban areas, argues that banks and government-controlled financial institutions Fannie Mae and Freddie Mac could be doing more to help families buy foreclosed homes.

Among its recommendations: Expand programs that give owner-occupiers and nonprofits a “first look” at foreclosed homes before they go up for auction.

“It is essential that the opportunity to become a homeowner is not inequitably limited to middle- and upper-income families,” according to the report.

Many need repairs

Real estate professionals counter that the large number of foreclosed homes purchased by investors are a temporary phenomenon, a sign that the real estate market has begun to rebound.

“It starts with investors’ rentals; that’s the first step,” said Paul Zeger, CEO of Pacific Marketing Associates, which markets residential properties on behalf of Bay Area developers. “As rents begin to rise, individuals and families start to see that buying a home makes economic sense.”

For his part, Sullivan said that the poor physical condition of most of the homes he buys would prevent families who need conventional bank financing from qualifying for a loan.

He pointed at a dilapidated duplex on 37th Street that he purchased this month for $234,000. Work crews were already inside.

“A property would not qualify for a financed buyer because the property needed all new electrical, plumbing, a new roof and a full cosmetic makeover,” Sullivan said. “Due to that, only an all-cash buyer who could put the money into rehabbing it could buy it.”

Aaron Glantz is a reporter for the Bay Citizen, part of the independent, nonprofit Center for Investigative Reporting. E-mail:

Article source:

Stopping foreclosures in North Minneapolis: For NCRC and JCA, It’s all about …

North Minneapolis homeowner Cathy Spann is in many ways a typical example of the foreclosure crisis. She had lived in her 1925 bungalow home for nearly than ten years, but a series of personal disasters, including the death of her husband and the loss of her job, made it difficult for her to make her mortgage payments.

Late in 2010, she received notice of a foreclosure and within days, her home was sold to JP Morgan Chase Bank at a sheriff’s sale. She had tried to talk with representatives at the bank, but for her, as for thousands of others facing the loss of her home, the bank wasn’t open to negotiations.

Spann, turned to the Northside Community Reinvestment Coalition (the NCRC) which, in collaboration with Jewish Community Action (JCA), is working to stop home foreclosures in economically struggling areas like North Minneapolis.

During the same year the bank took Spann’s home, 25,000 other Minnesota homeowners faced foreclosure, with with a greater percentage of these occurring in neighborhoods with a high concentration of minority populations.

“Our goal is to stop individual foreclosures, to build resident power and challenge financial discrimination,” said Dave Snyder, an organizer with Jewish Community Action and vice-chair of NCRC. Each week, Snyder, Harrison Neighborhood President and JCA organizer Maren McDonell and a group of dedicated volunteers knock on the doors of North Minneapolis homeowners who are scheduled for a sheriff’s sale. The organization’s goal is to direct the homeowners, many who feel they have nowhere to turn, to non-profit foreclosure prevention counselors.

Cathy Spann was one of the group’s success stories. With the help of the NCRC/JCA, she got the mortgage company to reverse her foreclosure and modifynher mortgage loan. Spann found a new job and now can afford to stay in her home.

Not all stories have a happy ending. CitiBank is one of the biggest offenders, said Snyder, and so far, negotiations with them have been unsuccessful. One of their clients, North Minneapolis resident Hawthorne Vinson, received a mortgage modification. but it lowered his monthly payments only by $80 and he racked up additional bank fees during the process. NCRC/JCA, said Snyder, is still working with Vinson toward a solution.

Currently, the group is working with eight families who are at the end of the foreclosure period, and with another 60 families who are getting assistance earlier in the process. “At least 65 percent of the time, we hit a home run,” McDonell said. “We can at least give the families a fighting chance, if they’ll work with us. We put pressure on banks to postpone sheriff’s sales. We try to give the families more time to get loan modifications. More times than not, we’ve been successful. What we do is connect the unconnected.”

The group uses other methods to influence banks to work with homeowners, calling political and community connections. “We’ve accumulated contacts at the banks. We send letters from clergy and from our coalition. We’ve gotten the attorney general’s office, Senator Franken and Keith Ellison involved to put pressure on the banks,” Snyder said.

Both McDonell and Snyder see how their organization’s tactics might be compared to the home sit-ins of the Occupy Movement, but both insist that their approach is different. “It’s important that Occupy play their role, but we’re not quite as dramatic,” Snyder said. “We have a core group of resident leaders who are active and committed. We’re trying to stop foreclosures, but we’re also trying to pass new banking laws and we want to change the terms of engagement between the community and the banks.”

Often, banks can make more money foreclosing on a home than they do when they cooperate with a homeowner. Part of the reason this is true is because in the first years of a mortgage, the largest part of the payments go to the loan’s interest, not the principal.

For example, after five years of monthly payments, a homeowner with a 30-year mortgage of $100,000, at a five percent interest rate, would have paid only $8,171 toward the principal, and would still owe nearly $92,000. After 10 years, a homeowner would have paid $18,657 and would still owe more than $81,000.

This may be one reason stopping foreclosures is not easy. The banks do not communicate with homeowners in distress because they don’t need to do so, said McDonell. They repeatedly lose paperwork. Bank employees assigned to individual cases will suddenly be unavailable – reassigned or resigned. “The banks want people to give up. This is one of the many reasons they want to make the modification process as difficult and anxiety producing as possible, “ Snyder said.

At any given time, said McDonell, there can be from 10 to 40 houses in north Minneapolis on the list for a sheriff’s sale. “It’s a really hard time, emotional and draining,” she said. “The hardest part is that families have overflowing files of paperwork and the banks lose it. If the banks would give families more time and offer them modification they can afford, we could solve the foreclosure crisis.”

Banks may also be less than cooperative because, unlike in the past, banks are often not local and not tied to the community. Snyder is hoping that his organization can convince some banks to play by different rules by showing them how their interests and the interests of the community can be the same.

Since last July, the organization has been lobbying Hennepin County to pressure banks change their foreclosure practices by threatening to move county and city monies to other financial institutions. While Wells Fargo and US Bank have the highest foreclosure numbers in Minnesota, Snyder said, he realizes that getting local governments to change banks might be difficult. “Right now, these are the only real game in town as far a depository services. These are the only ones who can process the payroll for 30,000 employees. And they’re both well-liked locally,” he said.

But Snyder said he hopes pressure on government officials, such as members of the city council, might eventually have an effect. “The point is not to scare the banks,” said Snyder. “It’s to pass laws to use leverage so they start disclosing data and improve their practices. It’s not a threat of immediate disinvestment. This is a medium to long-term plan. But what’s worked for us so far is modest pressure like this.”

Snyder said that the group also plans to expand their outreach to other neighborhoods in the near future, including door knocking in Northeast Minneapolis and neighborhoods in South Minneapolis.

Stephanie Fox's picture
Stephanie Fox

Stephanie Fox ( has a Master’s Degree from the University of Oregon. She moved to Minneapolis of her own free will in 1984.

Article source:

Chicago Chabad House Files for Bankruptcy to Avoid Foreclosure

Chicago Chabad House Files for Bankruptcy to Avoid Foreclosure


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The brownstone housing the Chabad Lubavitch of the Loop, Gold Coast and Lincoln Park was to have gone on the auction block Wednesday, but the bankruptcy filing this week gave Chabad additional time to repay a bank loan, the Chicago Tribune reported.

The group has found a way to pay its debts but needed more time, Rabbi Meir Chai Benhiyoun said, according to the Tribune.

Seven years ago, Chabad sought to build a new center at Chestnut and Clark streets, on Chicago’s so-called “Gold Coast,” and used its building on North Dearborn as collateral to the bank on the $4.9 million loan.

Following the economic downturn, donations for Chabad took a hit, the bank changed its rules and the organization was unable to finance its loan on the new property.

The Chabad House has served as a residence, classroom and a place to stop for Jewish travelers on visits to Chicago.


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Reworked deal helps St. Charles Town avoid foreclosure

Dennis Huspeni
Reporter- Denver Business Journal

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St. Charles Town Co. 

has avoided a foreclosure on its Sloans Lakefront Market by doing what many commercial developers have done: refinancing the deal by bringing more equity to the table.

Foreclosure proceedings had begun against the company, headed by Denver developer Charlie Woolley, although it hadn’t missed a payment, and the 11-business property was generating income and was (and is) almost 100 percent occupied.

Next, Woolley and CFO Darrin Grommeck got the original investors to reinvest in the project, injected some of St. Charles’ own capital and found a lender interested in Sloans.

“We don’t believe the foreclosure proceedings …

Dennis Huspeni covers real estate and retail for the Denver Business Journal and writes for the “Real Deals” blog.


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Raleigh’s Coker: Bankruptcy necessary to avoid foreclosure

Neal Coker runs the Burcam Capital II entity.

Neal Coker runs the Burcam Capital II entity.

Chris Bagley
Staff Writer- Triangle Business Journal


The entity that owns the lower floors of the 510 Glenwood building has filed for bankruptcy reorganization in an attempt to halt foreclosure proceedings on the space.

The entity, Burcam Capital II LLC, cited total liabilities of $10 million to $50 million in the Chapter 11 petition that it filed Thursday. Its primary loan balance is about $11.5 million, according to the mortgage analysis firm Trepp.

Burcam’s petition reported total assets in the same range. Debtors are required to file more detailed financial information within a few weeks of their initial petitions.

The bankruptcy filing comes after Burcam’s loan servicer started the foreclosure process about a month ago. The company stopped making payments on at least one loan in August.

Manager and co-owner Neal Coker described the bankruptcy as a necessary step to halt foreclosure. Burcam owns the 67,000 square feet that house 510’s offices, shops and restaurants such as Draft and, formerly, Cantina South.

The foreclosure and bankruptcy don’t affect the residential condominiums on the upper floors, and Coker said Friday that commercial tenants will not see any changes. The occupancy rate for the office space fell as low as 65 percent last year after the securities broker Morgan Keegan vacated its large office there, but has since rebounded into the high 90s. But that required spending tens of thousands of dollars in real estate commissions and remodeling for new tenants, Coker said.

A Hampton Inn 

expected to open in Glenwood South will bolster the restaurants and Burcam’s own revenue from the parking deck, he said.

Coker built 510 in 2000 with funds from Warner Bros. Entertainment COO Alan Horn and several other investors. Along with the redeveloped Creamery building nearby, it has been credited with creating Glenwood South as a lively entertainment district.

Chris Bagley covers the legal-services industry, transportation and utilities. Follow him on Twitter @cbagley.


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United Trustees Association Warns Foreclosure Regulations Will Hurt …

IRVINE, CA, Jun 28, 2012 (MARKETWIRE via COMTEX) –
The United Trustees Association (UTA), whose members serve as
trustees under deeds of trusts (i.e., mortgages), today warned that
stringent, nonjudicial foreclosure regulations being considered in
California’s legislature could stifle the state’s housing-market

Targeting lenders and a range of mortgage service providers,
including trustees under deeds of trust, the proposed California
Homeowner Bill of Rights “will ultimately harm, not help, the vast
majority of California homeowners,” according to a new study by
Beacon Economics LLC addressing the state’s foreclosure crisis.

“California’s fragile housing recovery cannot withstand new
regulatory and legal hurdles which could have unintended
consequences,” said T. Robert Finlay, UTA president. “Beacon’s study
reveals that California’s nonjudicial foreclosure model is actually
working, allowing for a faster turnaround than might otherwise be
possible. It would be prudent to more strictly enforce and improve
the current process than to succumb to layers of new policies driven
by politics.”

Led by noted economist Christopher Thornberg, the Beacon study
concluded that the Homeowner Bill of Rights overreacts to a market
that is showing signs of recovery independent of new government
intervention. Specifically, the study concluded the following about
California’s housing market:

        --  The worst may be over. The number of distressed mortgages is down
            significantly from its high of three years ago.
        --  New legislation would reduce home values. The study finds that housing
            markets with longer foreclosures periods result in greater discounts
            on foreclosed units when banks eventually sell them driving real
            property values lower.
        --  Increased losses among mortgage lenders will result in higher down
            payments, tougher credit standards for credit-worthy consumers and an
            even slower market recovery.
        --  There is no evidence that states with longer foreclosure processes
            have a greater percentage of loan modifications or fewer delinquent
            borrowers in foreclosure. The study suggests that the opposite may be
            true. Longer foreclosure periods encourage more homeowners to default
            on their loans, knowing that they can live in their property rent free
            for a longer period of time.
        --  The proposed California legislation is misdirected. The study suggests
            that the focus should be on preventing a future breakdown in credit
            standards, not condemning the current foreclosure process.

To reinforce its points, the study contrasted housing-market outcomes
in states with judicial foreclosure and nonjudicial foreclosure
processes, and cited a 2011 report stating that foreclosure timelines
are at an all-time high — 692 days in judicial states and 567 days
overall. The longer the foreclosure period, the greater the discount
on foreclosed units, the report concludes.

Housing market outcomes in two of California’s neighboring states,
Nevada and Arizona, both hit hard by unemployment, highlight this
trend. According to the seasonally adjusted Home Price Index by
SP/Case-Shiller, the value of residential real estate in Phoenix –
governed by Arizona’s unchanged nonjudicial foreclosure process –
grew from 103.33 in January 2012 to 108.51 in March 2012. In Las
Vegas, where the Nevada Legislature has added numerous layers to its
nonjudicial foreclosure process since 2009, the index increased less
than 1 point — from 90.15 to 90.75 — during the same period.

“Industry data shows that the more complicated the foreclosure
process becomes, the more that delays and cost increases can
compromise the housing market, and ultimately hurt consumers and the
economy,” said Finlay. “The delay in foreclosing caused by additional
regulation can also add to neighborhood blight as houses sit in
foreclosure for longer.”

The UTA believes that lawmakers’ misunderstanding about the current
foreclosure protocols is driving some of the nonjudicial foreclosure
proposals in the state legislature. It pointed to a critical report
published in February 2012 by the City and County of San Francisco’s
Office of the Assessor-Recorder. The UTA subsequently audited the
report, finding significant discrepancies between the findings in the
assessor-recorder’s report and actual documents recorded with his
office. In many instances, the UTA found no errors where the
assessor-recorder’s report claimed there were many.

About the UTA
Founded in 1968, the United Trustees Association (UTA)
is a member-based organization serving professionals — including
trustees, attorneys and loan servicing professionals from title
companies, financial institutions, law firms and independent
companies — acting as trustees under real property deeds of trust.
UTA Members are current on relevant case law, attend the best
educational meetings and trade shows in the industry, and
collectively advocate before state legislatures. For more
information, please visit , or contact
Executive Director Richard Meyers at (949) 260-9020, or

        Greg Jones
        (916) 934-3484
        Email Contact

SOURCE: United Trustees Association

Copyright 2012 Marketwire, Inc., All rights reserved.

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After Foreclosure, ‘Octomom’ Still Believes in Homeownership

Associated Press
In this May 2010 photo, ‘Octomom’ Nadya Suleman is shown outside her La Habra, Calif., home.

Nadya Suleman, the mother famously known as “Octomom,” may not win more time in her foreclosed home based solely on the needs of her supersized brood, though she’s working to raise funds for a new house.

As Developments wrote previously, the foreclosure on Ms. Suleman’s 2,445-square-foot, four-bedroom, three-bath home near Los Angeles was finalized last week, according to real-estate website ReatyTrac. Meridian Foreclosure Service, identified by RealtyTrac as the trustee on Ms. Suleman’s case, did not comment.

Ms. Suleman, who hasn’t heard from any lenders, declined to discuss the foreclosure. In an interview with Developments this week, she said she’d be grateful for a few additional months. She’s a single mother of 14 children, including eight children born at once in 2009.

Some housing advocates say her odds could be low for extra time beyond the roughly 40 days it will take the home’s new owner to go through California’s eviction process. (The post-foreclosure owner wasn’t immediately clear from public records filed so far.)

Ms. Suleman could petition the court for additional time in the home, citing hardship. The court would look at how much notice the family had of the foreclosure and how active the family has been in looking for another home, says Maeve Brown, executive director of HERA, a nonprofit law office in Oakland, Calif., that works to protect consumers from foreclosure. If she can’t prove hardship, it doesn’t matter how many children are in the home. “I think whether it’s 14 kids or 114 kids or two kids, that doesn’t fully answer the question of hardship,” Ms. Brown.

Another advocate agrees that the large brood won’t necessarily outweigh other factors. “There are a lot of cases that should receive extra sympathy from lenders or judges that don’t get a good outcome,” says Dave Lagstein, a spokesman for the Alliance of Californians for Community Empowerment.

For her part, Ms. Suleman doesn’t appear to be playing the sympathy card. “The goal is to move as soon as possible,” she says in the interview. “With all these opportunities coming our way, we’re going to be moving soon.”

She hopes these “opportunities” will bring in enough money for a significant down payment on a six- or seven-bedroom home in a gated community. “I just believe buying is a lot more realistic, a lot more practical” than renting, she says. She’d also like for this to be her last month on food stamps.

Ms. Suleman is now promoting sexually explicit video content and endorsing payday loans. (“If anyone knows financial hardship Nadya does,” states an ad at Ms. Suleman didn’t know the interest rate charged for borrowing.)

She’s also endorsing mobile phone coupons that promise to help her children’s education and chatting by phone with fans at a rate of $20 per minute at (She makes more than starlet Lindsay Lohan’s dad: Michael Lohan – he costs $12 a minute. Dina Lohan, commands $25.) She’ll appear at a Hollywood, Fla., club next month.

Ms. Suleman says she’s developed a sense of humor about her situation. My kids “feed me humble pie on a daily basis,” she says. “If I took myself seriously, I would have crumbled and cracked” already.

And if she didn’t have children? “I would be living in a one-bedroom in New York,” she says.

Follow Dawn @dwotapka

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Foreclosure fairness for Californians

It’s been five years since the housing bubble burst, but California lawmakers are finally poised to make lenders do something they should have been doing all along: evaluating less-expensive alternatives to foreclosure before starting the process of repossessing a home. That’s the centerpiece of the foreclosure reduction bill that a legislative conference committee approved Wednesday, setting the stage for a final vote in the Assembly and state Senate next week. Major banks continue to oppose it, but lawmakers should follow the conferees’ lead and send the measure to Gov. Jerry Brown’s desk.

The proposal by Atty. Gen. Kamala Harris (contained in the identical bills AB 278 and SB 900) would ban “dual tracking,” in which one arm of a bank considers a loan modification, short sale or other option for a defaulting borrower while another arm pursues a foreclosure. Five of the largest U.S. banks agreed to a temporary ban as part of a national settlement of mortgage-related complaints, but they and other lenders opposed making such a requirement a permanent part of California law.

The conference committee tightened up the bill in response to the banks’ concerns, limiting the relief to owner-occupied homes and applying many of the strictures only to banks with more than 175 foreclosures per year. Still, the final version requires banks to tell troubled borrowers about alternatives to foreclosure where they are available, and to respond in writing to a borrower’s completed application for one of those alternatives before setting the wheels in motion for a repossession. The bill also includes important protections against the sort of runarounds and procedural shortcuts that banks have inflicted on defaulting borrowers since the housing market collapsed.

The banks’ main complaint has been that the proposal would let borrowers who can’t or shouldn’t be rescued delay their foreclosures even longer. But even if it were to pass, banks could still foreclose at a faster pace than they do today. The limiting factor isn’t regulation, it’s the banks’ capacity to service defaulting loans and their desire not to flood the market with foreclosure sales.

Ultimately, it’s in everyone’s interests for lenders to foreclose only when it makes economic sense to do so. The banks have been their own worst enemies on this front, resisting the most effective forms of loan modifications in an effort to avoid short-term losses. Harris’ proposal wouldn’t require banks to modify loans; it would simply ensure that borrowers had the chance to be considered for the available alternatives, and that they couldn’t be foreclosed on as long as they were complying with the new terms. That’s not just reasonable, it’s overdue.

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