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‘If you can say it, you can sign it’ and other lessons from 2016

With the foreclosure crisis over and home prices continuing to increase, we’ve moved past the problems that were unique to the housing bust. It’s a more normal real estate market these days, but that doesn’t mean there aren’t issues around every corner. Here are my top lessons learned in 2016.

Whether you’re on the board of your community association or just live in one, you need to read your governing documents. The answers to most problems can be found there, so it should be your first stop before you file a complaint or a lawsuit.

Remember, when you bought your home, you agreed to the restrictions that are now vexing you. If you want to change the rules, get involved. Join the board of directors. If you’re on the board and want to change things, first clear it with the association’s attorney. Association litigation is expensive and often easy to avoid if you know your community’s rules and follow them.

I’ll address two questions I hear several times a week. First, your association can foreclose on your home over a small amount of owed dues. Even if there is a mistake on your maintenance bill, pay the disputed money and then work with your association to resolve the error. Second, accept that residents are entitled to service animals under the law — even if the residents don’t appear to have visible disabilities. If you think a resident is abusing the rules, speak to the association’s attorney before you do anything.

Interest rates are rising, and lenders are lending money again. If you have any intention of refinancing your mortgage, now is the time to do it. It’s also a good time to buy a home. As interest rates increase, your purchasing power will decrease. Although I don’t think interest rates will skyrocket, you should get the cheap money now while it’s still available.



South Florida 100 looking ahead to 2017

Caption South Florida 100 looking ahead to 2017

South Florida 100 panelists look ahead to 2017

South Florida 100 panelists look ahead to 2017

Republicans plan to overhaul the tax system

Caption Republicans plan to overhaul the tax system

Congressional Republicans’ goal is to simplify a complicated tax code that rewards wealthy people with smart accountants, and corporations that can easily shift profits — and jobs — overseas.

Congressional Republicans’ goal is to simplify a complicated tax code that rewards wealthy people with smart accountants, and corporations that can easily shift profits — and jobs — overseas.

Motorcyclist dreams of riding again after Christmas Eve crash leaves him a paraplegic

Caption Motorcyclist dreams of riding again after Christmas Eve crash leaves him a paraplegic

Robert Games was run down by a hit-and-run driver on Christmas Eve in 2014. Despite being left a paraplegic as a result of the crash, Games never lost hope.

Robert Games was run down by a hit-and-run driver on Christmas Eve in 2014. Despite being left a paraplegic as a result of the crash, Games never lost hope.

What is Jio?

Caption What is Jio?

Mukesh Ambani, India’s richest man, launched Jio, a LTE mobile network operator.

Mukesh Ambani, India’s richest man, launched Jio, a LTE mobile network operator.

CEO Lampert remains committed to bankrolling Sears

Caption CEO Lampert remains committed to bankrolling Sears

Sears’ stock jumped as much as 8.7% following a recent statement issued Dec. 29. (Dec. 29, 2016)

Sears’ stock jumped as much as 8.7% following a recent statement issued Dec. 29. (Dec. 29, 2016)

Finally, one of my favorite sayings is, “If you can say it, you can sign it.” Many times relationships go wrong, and promises get broken. Two people can have the same conversation and walk away with very different understandings. Whether you are agreeing to help your adult child buy a home or making a deal with a contractor to remodel your kitchen, always write down what you both agree to and then sign your names to it. While a properly drafted contract is best, just writing down, in detail, what each party agreed to will reduce the chances of a dispute and make things easier to resolve if there is a disagreement.

Board-certified real estate lawyer Gary M. Singer writes about the housing market at SunSentinel.com/business/realestate each Friday. To ask him a question, email him at gary@garysingerlaw.com, or go to SunSentinel.com/askpro.

Article source: http://www.sun-sentinel.com/real-estate/fl-gary-singer-col-01022017-20161230-story.html

DMX Is ‘Drowning In Debt’ And Has Reportedly Filed For Bankruptcy

Getty Image

DMX was almost a casualty of 2016, but it looks like his bank account wasn’t spared the same fate. The rap legend has reportedly filed for bankruptcy once again — his the third time in seven years. X, real name Earl Simmons, first filed for bankruptcy in 2009 and then again in 2013. The 2009 case was rejected for “unreasonable delays,” while the 2013 case was throw out because the judge didn’t trust the documents X submitted were truly representative of his financial situation. This time, X is hoping to catch a break in an effort to save his home from going into foreclosure.

DMX reportedly owes creditors a whopping $2 million, per court documents obtained by The Dirty. The father of 15 filed for Chapter 13 bankruptcy earlier this month and alleges owing over $300,000 in back child support and $950,000 to Compass Bank, as well as $1.4 million in family support and other debts.

The Ruff Ryder lists his New York home as his only asset, valued at an estimated $350,000, claims he has $0.00 in his bank account, and has no other assets to his name according to court documents. The 46-year-old legend says he can’t even rely on any of his music because he doesn’t own any copyrights or trademarks for “any of his music for over a decade of his career.”

According to the court documents, DMX filing for bankruptcy is an attempt to stop a foreclosure sale of his home. The Mt. Kisco, New York house was foreclosed on in April 2016 after the rapper and ex-wife Tashera failed to pay $738,134 in missed mortgage payments, interest, and late charges. The former couple reportedly stopped making payments in 2008, eight years after purchasing the home for $649,000. The foreclosure sale is now is on hold pending the results of X’s bankruptcy case.

In the meantime, DMX has two confirmed shows booked for January. So that’s a start.

Article source: http://uproxx.com/realtalk/dmx-bankruptcy-again/

Obama’s foreclosure prevention program limps to finish line – The …




When the Obama administration announced a massive effort to help distressed homeowners in 2009, it set high expectations. The program, government officials said, would keep up to 4 million borrowers out of foreclosure.

‘‘It will give millions of families resigned to financial ruin a chance to rebuild,’’ Obama said at a event announcing the effort. ‘‘By bringing down the foreclosure rate, it will help shore up housing prices for everyone.’’

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Six years later, Obama is preparing to leave office, and the Home Affordable Modification Program was scheduled to accept its final applications Friday, having helped a small fraction of the homeowners government officials initially expected. About 1.6 million borrowers have seen their mortgage payments lowered through the program so far, but about a third of those people eventually fell behind on their payments again.

‘‘The president set out an ambitious goal that wasn’t met,’’ said Kevin Stein, deputy director of the California Reinvestment Coalition, a housing advocacy group. ‘‘It was definitely a step forward and step in the right direction, but it didn’t [reach its goal] and a lot of people ended up falling through the cracks.’’

HAMP is one of the last remnants of the $700 billion taxpayer bailout effort, known as the Troubled Asset Relief Program or TARP, put in place during the financial crisis. Some of that money, about $28 billion, was carved out to help distressed homeowners by paying banks to lower their interest rates and monthly payments.

It was launched in the midst of one of the deepest housing crises in US history. Millions of people had taken out subprime loans that they could no longer afford, sending foreclosure rates to record levels.

The Obama administration set out to save more homeowners from foreclosure, but the effort has been bedeviled by complaints that banks repeatedly lost homeowners’ paperwork or incorrectly told them that they didn’t qualify for help. The Treasury Department didn’t act quickly enough to force banks to abide by the rules of the program, housing advocates have said. Nearly 70 percent of the homeowners who applied for the program were rejected, according to government data.

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A 2014 report examined the record of four large mortgage servicers and found that black and Hispanic borrowers were denied entry into the program at a ‘‘significantly higher’’ rate. ‘‘Borrowers in substantially minority areas had at least 3 percent higher denial rates than their comparison populations of borrowers in nonsubstantially minority areas,’’ according to the Government Accountability Office. ‘‘Statistical differences in outcomes among population groups might suggest potential fair lending concerns that merit further examination.’’

The banking industry has defended its performance, noting that some of the money it receives through HAMP is passed on to investors and borrowers, who receive incentives for paying their mortgages on time. HAMP was a complicated program, industry executives have said, and it took time to develop a protocol for judging when a borrower should qualify and how much help to give them.

Many of the program’s early problems reflect its complexity, said Justin Wiseman, director of loan administration policy at the Mortgage Bankers Association, an industry group. ‘‘It’s incredibly difficult to design a program in the midst of a crisis,’’ he said. In the end, HAMP ‘‘did help millions of homeowners and created awareness’’ about the availability of loan modifications.

Even critics of the program note that despite falling short of expectations, HAMP forced the banking industry to change its approach toward distressed borrowers. Before the program, banks all had different approaches to helping borrowers who were behind on their mortgage payments. Some simply added a homeowners’ overdue amount to their current payments, increasing rather than lowering their payments. Others refused to discuss helping a borrower until they were 90 days delinquent.

‘‘It was really the wild, wild west,’’ Stein said.

The government program lifted industry standards and set common expectations that banks adopted even when operating outside HAMP, said Alys Cohen, staff attorney for National Consumer Law Center. ‘‘Many homeowners got similar types of modifications directly through their mortgage company, and those were modeled on the HAMP program,’’ Cohen said.

About 1 million borrowers currently have HAMP loan modifications, which typically lower their payments about $500 a month. After being extended three times, the program, which was originally scheduled to expire in 2012, was supposed to stop taking applications Friday.

The program ‘‘changed how mortgage servicers handled homeowners in distress; not only by developing a template for loan modifications focused on affordability but also by creating and enforcing standards of care that have been widely adopted by the entire industry,’’ a Treasury spokesman said.

That program allows people who owe more than their home is worth, known as being ‘‘underwater,’’ to refinance into a loan at a lower interest rate. So far, about 3 million homeowners have used that program. The Obama administration initially expected up to 5 million. It is now scheduled to expire in September 2017.

For the Office of the Special Inspector General for the Troubled Asset Relief Program, or SIGTARP, the chief watchdog of the financial-crisis-era bailouts, the end of the HAMP application process doesn’t diminish its worries. Banks will continue to receive billions in incentive payments for helping borrowers who signed up for HAMP for seven years. Wells Fargo, which has received $1.8 billion through the program, is eligible for up to $1.5 billion in bailout funds over the next seven years, for example. JPMorgan and Bank of America, which have received $1.9 billion and $1.4 billion respectively, could receive about $1 billion each over the next few years.

Many of these banks have repeatedlybroken the rules of the program, including kicking homeowners out unfairly or making it too difficult to apply for the help, according to the agency.

‘‘While HAMP did not live up to expectations, the most important thing going forward is to protect from fraud, waste, and abuse the nearly 1 million people with lowered interest rates in the program and the billions of dollars Treasury will continue to pay to mortgage servicers,’’ said Christy Goldsmith Romero, special inspector general for TARP.

Article source: https://www.bostonglobe.com/business/2016/12/30/obama-foreclosure-prevention-program-limps-finish-line/KBbADhg9Cwx1QbotkorKYL/story.html

Few details to be found in subpoenas targeting Detroit demolition …

We now know the contents of two federal subpoenas issued to the Detroit agencies running the city’s building demolitions program, but they don’t tell us much more than we already knew about an ongoing investigation.

The Detroit Land Bank and Building Authorities received the subpoenas in May.

They demanded the agencies turn over basically everything they have related to federally funded demolition contracts since the start of 2014.

The U.S. Treasury has allocated Michigan more than $380 million for demolition and blight elimination programs from its Hardest Hit Fund. That money was originally intended to help homeowners avoid foreclosure.

The lion’s share of that money — about $260 million — was set aside for Detroit. Under Mayor Mike Duggan, the city has used some of it to demolish more than 10,000 vacant homes and buildings so far.

The fact that the program faced a criminal investigation over alleged bid-rigging, inflated pricing, and other questionable practices has been known for months. In October, Duggan announced that the Treasury had briefly suspended HHF funds for Detroit demolitions until new changes and oversight were put in place.

The subpoenas give us few further specifics about the investigation, other than to confirm that it’s wide-ranging.

The Land Bank’s subpoena demands “all voicemail communications and records of telephone calls,” meeting minutes and notes, and appointment schedules “pertaining to HHF demolition contracts” from a number of land bank employees and board members, as well as their communications with certain demolition contractors and the Michigan State Housing and Development Authority.

The Building Authority’s subpoena asks for the same information from a number of current and former employees, but also includes emails and text messages.

The Land Bank released the contents of the subpoenas Friday, ahead of a judge’s order to unseal them in court Jan. 12.

“The DLBA and DBA have fully cooperated and complied with this subpoena and the ongoing investigation,” Land Bank spokesman Craig Fahle said in a statement. He added that the subpoenas had been kept under wraps at the government’s request, but the agency decided to release them now after Wayne County Judge Robert Allen’s court ruling this month “gave us clear guidance.”

The subpoena demanded the information be provided by June 10. Federal agents paid a visit to the Detroit Land Bank offices last month to pick up more potential evidence; Fahle was unable to say what that was.

The investigation, spearheaded by a U.S. Treasury Special Inspector General (which issued the subpoena) with help from the FBI and Detroit U.S. Attorney Barbara McQuade’s office, have been very tight-lipped about it, providing almost no details beyond confirming that it exists and is ongoing.

So it remains unclear whether the investigation will be wrapped up, and charges potentially filed, before the incoming Trump administration takes over Jan. 20.

Article source: http://michiganradio.org/post/few-details-be-found-subpoenas-targeting-detroit-demolition-program

Foreclosure prevention program is ending after helping fewer than … – The Spokesman

When the Obama administration announced a massive effort to help distressed homeowners in 2009, it set high expectations. The program, government officials said, would keep up to 4 million borrowers out of foreclosure.

“It will give millions of families resigned to financial ruin a chance to rebuild,” Obama said at a event announcing the effort. “By bringing down the foreclosure rate, it will help shore up housing prices for everyone.”

Six years later, Obama is preparing to leave office and the Home Affordable Modification Program is scheduled to accept its final applications on Friday having helped a small fraction of the homeowners government officials initially expected. About 1.6 million borrowers have seen their mortgage payments lowered through the program so far, but about a third of those people eventually fell behind on their payments again.

“The president set out an ambitious goal that wasn’t met,” said Kevin Stein, deputy director of the California Reinvestment Coalition, a housing advocacy group. “It was definitely a step forward and step in the right direction, but it didn’t reach its goal and a lot of people ended up falling through the cracks.”

HAMP is one of the last remnants of the $700 billion taxpayer bailout effort, known as the Troubled Asset Relief Program or TARP, put in place during the financial crisis. Some of that money, about $28 billion, was carved out to help distressed homeowners by paying banks to lower their interest rates and monthly payments.

It was launched in the midst of one of the deepest housing crises in U.S. history. Millions of people had taken out subprime loans that they could no longer afford, sending foreclosure rates to record levels.

The Obama administration set out to save more homeowners from foreclosure, but the effort has been bedeviled by complaints that banks repeatedly lost homeowners’ paperwork or incorrectly told them that they didn’t qualify for help. The Treasury Department didn’t act quickly enough to force banks to abide by the rules of the program, housing advocates have said. Nearly 70 percent of the homeowners who applied for the program were rejected, according to government data.

A 2014 report examined the the record of four large mortgage servicers and found that black and Hispanic borrowers were denied entry into the program at a “significantly higher” rate. “Borrowers in substantially minority areas had at least 3 percent higher denial rates than their comparison populations of borrowers in nonsubstantially minority areas,” according to the Government Accountability Office. “Statistical differences in outcomes among population groups might suggest potential fair lending concerns that merit further examination.”

The banking industry has defended its performance, noting that some of the money it receives through HAMP is passed on to investors and borrowers, who receive incentives for paying their mortgages on time. HAMP was a complicated program, industry executives have said, and it took time to develop a protocol for judging when a borrower should qualify and how much help to give them.

Many of the program’s early problems reflect its complexity, said Justin Wiseman, director of loan administration policy at the Mortgage Bankers Association, an industry group. “It’s incredibly difficult to design a program in the midst of a crisis,” he said. In the end, HAMP “did help millions of homeowners and created awareness” about the availability of loan modifications.

Even critics of the program note that despite falling short of expectations HAMP forced the banking industry to change its approach toward distressed borrowers. Before the program, banks all had different approaches to helping borrowers who were behind on their mortgage payments. Some simply added a homeowners’ overdue amount to their current payments, increasing rather than lowering their payments. Others refused to discuss helping a borrower until they were 90 days delinquent.

“It was really the wild, wild west,” Stein said.

The government program lifted industry standards and set common expectations that banks adopted even when operating outside HAMP, said Alys Cohen, staff attorney for National Consumer Law Center. “Many homeowners got similar types of modifications directly through their mortgage company and those were modeled on the HAMP program,” Cohen said.

About 1 million borrowers currently have HAMP loan modifications, which typically lower their payments about $500 a month. After being extended three times, the program, which was originally scheduled to expire in 2012, will stop taking applications on Friday.

The program “changed how mortgage servicers handled homeowners in distress; not only by developing a template for loan modifications focused on affordability but also by creating and enforcing standards of care that have been widely adopted by the entire industry,” a Treasury spokesman said.

The program was expanded over time to include helping lowering how much homeowners owed in some cases in additional to lower their payments, and people who are unemployed, a Treasury Department official noted. And another part of Obama’s foreclosure prevention effort, the Home Affordable Refinance Program, or HARP, has also been repeatedly extended as it struggled to reach as many people as initially hoped.

That program allows people who owe more than their home is worth, known as being “underwater,” to refinance into a loan at a lower interest rate. So far, about 3 million homeowners have used that program. Obama administration initially expected up to 5 million. It is now scheduled to expire in September 2017.

For the Office of the Special Inspector General for the Troubled Asset Relief Program, or SIGTARP, the chief watchdog of the financial crisis-era bailouts, the end of the HAMP application process doesn’t diminish its worries. Banks will continue to receive billions in incentive payments for helping borrowers who signed up for HAMP for seven years. Wells Fargo, which has received $1.8 billion through the program, is eligible for up to $1.5 billion in bailout funds over the next seven years, for example. JPMorgan and Bank of America, which have received $1.9 billion and $1.4 billion respectively, could receive about $1 billion each over the next few years.

Many of these banks have repeatedly broken the rules of the program, including kicking homeowners out unfairly or making it too difficult to apply for the help, according to the agency.

“While HAMP did not live up to expectations, the most important thing going forward is to protect from fraud, waste and abuse the nearly one million people with lowered interest rates in the program and the billions of dollars Treasury will continue to pay to mortgage servicers,” said Christy Goldsmith Romero, Special Inspector General for TARP.

Article source: http://www.spokesman.com/stories/2016/dec/30/foreclosure-prevention-program-is-ending-after-hel/

Options for homeowners heading toward foreclosure

Happy New Year, Duane! My name is Carol, and my father is beginning to fall behind on his mortgage payments. I don’t want him to lose his home, and was hoping you could provide some ideas on ways that I could help him with his challenges.

Happy New Year to you as well, Carol! Thank you for your difficult, but very important, question. Challenges like these are painful to talk about. But I think it’s a very important topic, as other folks may be in similar positions.

When someone buys a house, losing it would be the last thing that comes to their mind. People heading toward foreclosure usually have a few options.

Don’t ignore the bills. Don’t ignore any kind of bills or notices from your lender. The more you ignore, the harder it will become in the future to deal with the issue.

Respond. You should carefully read and respond to every letter or notice from your lender. The first few letters might have extended information about how you can avoid foreclosure and the coming letters might include important notices and inform you about certain actions you need to take.

Communicate with the lender. Most of the lenders would like to avoid foreclosures as well, since it costs them money and time. Try to talk to the lender, if you are unable to pay some of your bills and they might understand your situation. 

Talk to a local Real estate pro. Call a local Real estate pro who has a good reputation, and they might be able to give some helpful suggestions with their experience. You can come up with a plan to save your home, or least your equity.

Refinancing. You can see if refinancing is an option by asking your real estate pro to recommend you to some other lenders that might alter your current mortgage to a more favorable monthly situation.

Prioritize your spending. Paying your mortgage bills timely should be one of your first priorities. If you are spending somewhere else more than your mortgage bills, review your finances and make sure you have enough money to pay your mortgage.

Debt forgiveness. Ask your lender to give you a break or waive your obligation to pay a couple of monthly payments, which might give you some time to set things straight and get back on track with your finances.

Repayment plan. You can request your lender for a repayment plan, in which the lender would add up a small amount that you are required to pay every month with your actual mortgage in the coming future, as an extra interest.

If you ever just need someone to talk to, give me a call! I’m always here to help! I hope your 2016 was great and your 2017 will be even greater! Happy New Year!

See ya next year, Guamies!


Remember, for all of your Guam real estate needs – who ya gonna call? Duane Pahl! (671) 689-7777, duane@guamhome.com, www.duanepahl.com

Article source: http://www.postguam.com/business/real_estate/options-for-homeowners-heading-toward-foreclosure/article_131a423a-ce5e-11e6-ae20-5393d2a68c32.html

Senate Democrats miss the mark calling Trump Treasury pick “foreclosure king”

Senate Democrats made it clear they are not big fans of Steve Mnuchin, a former executive at Goldman Sachs, the former chairman of OneWest Bank, and President-elect Donald Trump’s choice to lead the Department of the Treasury.

As HousingWire reporter Ben Lane reported, it appears that the Democrats will seek to use Mnuchin’s time at OneWest as part of their case against approving him as Treasury secretary, calling Mnuchin the “foreclosure king” and asking people who may have been “impacted” by OneWest’s practices to share their stories.

For those who need reminding, OneWest was formed in the remains of IndyMac, and it is that activity that helped Trump in his decision.

“He (Mnuchin) purchased IndyMac Bank for $1.6 billion and ran it very professionally, selling it for $3.4 billion plus a return of capital,” Trump said last month. “That’s the kind of people I want in my administration representing our country.”

However, according to Jack Guttenberg, professor of finance emeritus at the Wharton School of the University of Pennsylvania writing in the Huffington Post, Democrats may find it troubling to get the “foreclosure king” label to stick, primarily due to a level of misreporting in the media.

He explains:

The headline on Bloomberg News as reported by National Mortgage News caught my eye. It read “Mnuchin’s Reverse Mortgage Woes Blemish Record of Treasury Pick.” As I read on, I realized that reverse mortgage-bashing by the media, which had almost disappeared in recent years, was now being revived to tarnish a Trump appointee. The article reports that reverse mortgages are an “icky” business in which celebrity spokespersons “set the stage for a potential foreclosure on an elderly widow or widower…”

What is the connection to Mnuchin? With several other investors, he had acquired the insolvent IndyMac in 2009 from FDIC, and with it Financial Freedom, a reverse mortgage lender owned by Indy Mac. Financial Freedom, according to Bloomberg, “has carried out 16,220 foreclosures since 2009, or about 39% of the country’s reverse-mortgage foreclosures…” The “blemish” on Mnuchin seems to be his association with the heavy foreclosure volume by Financial Freedom.

As his headline suggests, “Foreclosures of reverse mortgages are different.” And, he asked HUD for some more clarification. When it comes to reverse mortgages, the government explained, there are actually few of the painful evictions that are usually associated with the foreclosure process.

“In sum, the word “foreclosure” is freighted with emotion because of its association with evictions of borrowers who have defaulted on their standard mortgages,” Guttenberg explains. “On HECM reverse mortgages, very few foreclosures involve evictions, which are rare and becoming more so.”

Therefore, if Senate Democrats wish to nail Mnuchin as a foreclosure king, it would be prudent to stick to forward mortgage foreclosures he is associated with, lest they wish to incriminate the FHA and its HECM practices as well.

Article source: http://www.housingwire.com/blogs/1-rewired/post/38853-senate-democrats-miss-the-mark-calling-trump-treasury-pick-foreclosure-king

Obama’s foreclosure prevention program has helped far fewer homeowners than expected

When the Obama administration announced a massive effort to help distressed homeowners in 2009, it set high expectations. The program, government officials said, would keep up to 4 million borrowers out of foreclosure.

“It will give millions of families resigned to financial ruin a chance to rebuild,” Obama said at a event announcing the effort. “By bringing down the foreclosure rate, it will help shore up housing prices for everyone.”

Six years later, Obama is preparing to leave office, and the Home Affordable Modification Program, or HAMP, accepted its final applications Friday having helped a fraction of the homeowners government officials initially expected. About 1.6 million borrowers have seen their mortgage payments lowered through the program so far, but about a third of those people eventually fell behind on their payments again.

“The president set out an ambitious goal that wasn’t met,” said Kevin Stein, deputy director of the California Reinvestment Coalition, a housing advocacy group. “It was definitely a step forward and step in the right direction, but … a lot of people ended up falling through the cracks.”

Wells Fargo, which has received $1.8 billion through the program, is eligible for up to $1.5 billion in bailout funds over the next seven years, for example. JPMorgan and Bank of America, which have received $1.9 billion and $1.4 billion, respectively, could receive about $1 billion each over the next few years.

Many of these banks have repeatedly broken the rules of the program, including kicking homeowners out unfairly or making it too difficult to apply for the help, according to the agency.

“While HAMP did not live up to expectations, the most important thing going forward is to protect from fraud, waste and abuse the nearly 1 million people with lowered interest rates in the program and the billions of dollars Treasury will continue to pay to mortgage servicers,” said Christy Goldsmith Romero, special inspector general for TARP.

Article source: http://www.latimes.com/business/la-fi-obama-foreclosure-20161230-story.html

Judge to hear Octagon House lawsuit Wednesday

FOND DU LAC – A hearing on Wednesday could determine the fate of Fond du Lac’s historic Octagon House, which is facing foreclosure.

BMO Harris Bank is suing Marlene Hansen, owner of the Octagon House, over an unpaid home equity mortgage. At a hearing Wednesday, a Fond du Lac County judge will weigh arguments for and against foreclosure of the 160-year-old property, once a stop on the underground railroad.

“If the bank forecloses, who knows what will become of the home,” Hansen said Thursday. “I’m still hopeful that this can be settled.”

RELATED: Fate of Octagon House uncertain as suit looms

RELATED: Fond du Lac’s Octagon House closed to the public

In its foreclosure lawsuit, BMO Harris Bank argues Hansen failed to pay back an $85,000 loan that she took out in 1999 to pay for repairs to the home. BMO bought MI Bank in 2009, taking ownership of the debt. Hansen’s attorney, Dan Kaminsky, argues that the bank can’t account for how much she owes, citing a debt that fluctuates between $59,000 and $83,000.

It’s unclear from court documents how much remains on the loan. Each side claims the other is misreading the size of Hansen’s debt. While BMO argues the case is a clear-cut foreclosure, Kaminsky argues the bank lost Hansen’s paperwork in the acquisition of MI.

Both sides have filed paperwork appealing to Fond du Lac County Circuit Court Judge Richard Nuss for a ruling in their favor.

Hansen has owned the home since 1975, when she bought the home outright for $25,000, saving the property from demolition by the state. Hansen said she has been trying to sell the home for years, but no buyer has surfaced.

Built by Isaac Brown, the first mayor of Fond du Lac, the Octagon House was once a stop on the Underground Railroad. The home’s secret passageways helped ferry slaves to the Fond du Lac River, and to freedom from there. A Go Fund Me Page surfaced on Nov. 9, seeking to raise $85,000 for the lawsuit and outstanding loans. As of Thursday, no one had donated to that effort.

Reach Nate Beck at 920-858-9657 or nbeck@gannett.com; on Twitter: @NateBeck9

Article source: http://www.fdlreporter.com/story/news/2016/12/29/judge-hear-octagon-house-lawsuit-wednesday/95957280/

After helping a fraction of homeowners expected, Obama’s foreclosure prevention program is finally ending


Joseph Barratt, 55, and others demonstrate outside a HOPE NOW homeownership preservation workshop at the University of Pennsylvania in Philadelphia in 2008. Demonstrators hoped to draw attention subprime mortgage crisis. (Matt Rourke/AP Photo)

When the Obama administration announced a massive effort to help distressed homeowners in 2009,  it set high expectations. The program, government officials said, would keep up to 4 million borrowers out of foreclosure.

“It will give millions of families resigned to financial ruin a chance to rebuild,” Obama said at a event announcing the effort.  “By bringing down the foreclosure rate, it will help shore up housing prices for everyone.”

Six years later, Obama is preparing to leave office and the Home Affordable Modification Program is scheduled to accept its final applications on Friday having helped a small fraction of the homeowners government officials initially expected. About 1.6 million borrowers have seen their mortgage payments lowered through the program so far, but about a third of those people eventually fell behind on their payments again.

“The president set out an ambitious goal that wasn’t met,” said Kevin Stein, deputy director of the California Reinvestment Coalition, a housing advocacy group. “It was definitely a step forward and step in the right direction, but it didn’t [reach its goal] and a lot of people ended up falling through the cracks.”

HAMP is one of the last remnants of the  $700 billion taxpayer bailout effort, known as the Troubled Asset Relief Program or TARP, put in place during the financial crisis. Some of that money, about $28 billion, was carved out to help distressed homeowners by paying banks to lower their interest rates and monthly payments.

It was launched in the midst of one of the deepest housing crises in U.S. history. Millions of people had taken out subprime loans that they could no longer afford, sending foreclosure rates to record levels.

The Obama administration set out to save more homeowners from foreclosure, but the effort has been bedeviled by complaints that banks repeatedly lost homeowners’ paperwork or incorrectly told them that they didn’t qualify for help. The Treasury Department didn’t act quickly enough to force banks to abide by the rules of the program, housing advocates have said. Nearly 70 percent of the homeowners who applied for the program were rejected, according to government data.

A 2014 report examined the the record of four large mortgage servicers and found that black and Hispanic borrowers were denied entry into the program at a “significantly higher” rate. “Borrowers in substantially minority areas had at least 3 percent higher denial rates than their comparison populations of borrowers in nonsubstantially minority areas,” according to the Government Accountability Office.  “Statistical differences in outcomes among population groups might suggest potential fair lending concerns that merit further examination.”

The banking industry has defended its performance, noting that some of the money it receives through HAMP is passed on to investors and borrowers, who receive incentives for paying their mortgages on time. HAMP was a complicated program, industry executives have said, and it took time to develop a protocol for judging when a borrower should qualify and how much help to give them.

Many of the program’s early problems reflect its complexity, said Justin Wiseman, director of loan administration policy at the Mortgage Bankers Association, an industry group. “It’s incredibly difficult to design a program in the midst of a crisis,” he said. In the end, HAMP “did help millions of homeowners and created awareness” about the availability of loan modifications.

Even critics of the program note that despite falling short of expectations HAMP forced the banking industry to change its approach toward distressed borrowers. Before the program, banks all had different approaches to helping borrowers who were behind on their mortgage payments. Some simply added a homeowners’ overdue amount to their current payments, increasing rather than lowering their payments. Others refused to discuss helping a borrower until they were 90 days delinquent.

“It was really the wild, wild west,” Stein said.

The government program lifted industry standards and set common expectations that banks adopted even when operating outside HAMP, said Alys Cohen, staff attorney for National Consumer Law Center.  “Many homeowners got similar types of modifications directly through their mortgage company and those were modeled on the HAMP program,” Cohen said.

About 1 million borrowers currently have HAMP loan modifications, which typically lower their payments about $500 a month. After being extended three times, the program, which was originally scheduled to expire in 2012, will stop taking applications on Friday.

The program “changed how mortgage servicers handled homeowners in distress; not only by developing a template for loan modifications focused on affordability but also by creating and enforcing standards of care that have been widely adopted by the entire industry,” a Treasury spokesman said.

The program was expanded over time to include helping lowering how much homeowners owed in some cases in additional to lower their payments, and people who are unemployed, a Treasury Department official noted. And another part of Obama’s foreclosure prevention effort, the Home Affordable Refinance Program, or HARP, has also been repeatedly extended as it struggled to reach as many people as initially hoped.

That program allows people who owe more than their home is worth, known as being “underwater,” to refinance into a loan at a lower interest rate. So far, about 3 million homeowners have used that program. Obama administration initially expected up to 5 million. It is now scheduled to expire in September 2017.

For the Office of the Special Inspector General for the Troubled Asset Relief Program, or SIGTARP, the chief watchdog of the financial crisis-era bailouts, the end of the HAMP application process doesn’t diminish its worries. Banks will continue to receive billions in incentive payments for helping borrowers who signed up for HAMP for seven years. Wells Fargo, which has received $1.8 billion through the program, is eligible for up to $1.5 billion in bailout funds over the next seven years, for example. JPMorgan and Bank of America, which have received $1.9 billion and $1.4 billion respectively, could receive about $1 billion each over the next few years.

[Taxpayers are still bailing out Wall Street, eight years later]

Many of these banks have repeatedly broken the rules of the program, including kicking homeowners out unfairly or making it too difficult to apply for the help, according to the agency.

“While HAMP did not live up to expectations, the most important thing going forward is to protect from fraud, waste and abuse the nearly one million people with lowered interest rates in the program and the billions of dollars Treasury will continue to pay to mortgage servicers,” said Christy Goldsmith Romero, Special Inspector General for TARP.

Article source: https://www.washingtonpost.com/news/business/wp/2016/12/30/after-helping-a-fraction-of-homeowners-expected-obamas-foreclosure-prevention-program-is-finally-ending/