Too many Games

Too much Fraud (by property owners, agents & investors)

Easy Solutions

  In order to maximize the amount of money banks are receiving for their assets, their fiduciary duty to their shareholders and moral duty to the American taxpayers who have to bail them out when they get into financial trouble and are "too big to fail", banks need to introduce a higher element of transparency in the short sale transaction process.     Like many REO lenders have already started to do, all short sale offers should be submitted via a lender-direct website that goes directly to the loss mitigation department of the existing lien holders.    
  • No more putting your house up for short sale to extend the amount of time you can live for free. 
  • No…

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(article via California Association of Realtors Newsline) 

 

Mortgage Forgiveness Debt Relief extended


Late Tuesday night (1/1/2013), Congress reached a settlement in the “fiscal cliff” negotiations.  As a result, the Mortgage Forgiveness Debt Relief Act has been extended for another year.  The measure will continue to exempt from taxation mortgage debt that is forgiven when homeowners and their mortgage lenders negotiate a short sale, loan modification (including any principal reduction), or foreclosure. 

C.A.R. would like to thank the 26,296 California REALTORS® who sent messages to their members of Congress and made 1,862 calls in response to C.A.R.’s Call-for-Action.

Also under the agreement, so called “Pease Limitations” that reduce the value of…

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Interesting Takeaways from "Should A Borrower With An Underwater Mortgage Strategically Default?" by Evan Nemeroff
  • 31% (15.3 million) of U.S. homeowners who have a mortgage underwater
  • nearly three-quarters have properties that are 40% below their buying cost
  • When homeowners were asked in the survey why they would not choose to strategically default, 37% cited moral reasons, while 35% indicated it didn’t make sense since they intend to live in that house for an extended period of time.
  • The most common reason for avoiding strategic default cited by homeowners was that it is a moral issue.
  • Even though one out of every three homeowners with a mortgage is underwater today, Zillow said 90.8% of these homeowners are current on their mortgage and…

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The Mortgage Debt Relief Act runs out this year.  This means that sellers considering doing a short sale should start now in order to avoid closing next year because if they close next year the 1099 that the lender will send them will cause them to have to pay Federal and State income taxes on the amount that the lender lost as ordinary income.  This protection has nothing to do with gains it is the lenders loss that you will be paying taxes on.
So make sure that if you are on the fence about whether or not to start a short sale you are aware of this.  See links below for the State of California and the IRS documents on this law which was enacted in 2007 and ends this year, December 31st 2012.     Follow this link for more info on Los Angeles…

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You don't have to pay the sellers just change the mortgage underwriting guidelines so that after a short sale where the seller fully participates (not someone who milked the system to live for free as long as possible) you can buy a home.  How about take the number of mortgage payments missed multiplied by a factor say 2, 3 or 4 + a base number ( say 3 months) and that is how long a buyer has to wait to buy a new home after a short sale versus the 3-4-5-7 years they have to wait for allowing the house to go into foreclosure. Do this and you'll get much better participation and you dont' have to use more taxpayer TARP-funded money to give to overextended homeowners.

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The article fron Transunion entitled "TransUnion Study Finds Opportunity in Mortgage-Only Default Market" is the first data I've seen that shows what many real estate and mortgage industry participants have known for a long time.  People that have good credit take away mortgage lates related to a loan modification or a short sale are much lower credit risks than people that actually let their house go to foreclosure.  There are many reasons that may have forced a consumer to move at a time when due to greater macro economic circumstances there home may have been underwater.  They could have been laid off and had to find a new job in a new area being a very common cause in our current economy as an example.

I've always said that lenders want to lend,…

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- junior lien holders can still pursue judgements - doesn't apply if homeowner refinanced mortgage - eliminates lenders option to allow short sale but maintain the right to pursue deficiency judgement by forcing seller to agree (in writing as a condition of approving the short sale) to allow the lender to pursue the deficiency judgement in the future 

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Sellers that short sale Los Angeles Real Estate no longer have to pay California state income tax on debt forgiven in a short sale, foreclosure, or loan modification.  Enacted into law April 12th 2010, Senate Bill 401 generally aligns California's tax treatment of mortgage debt relief income with federal law.  For debt forgiven on a loan secured by a "qualified principal residence," borrowers will now be exempt from both federal and state income tax consequences.  The existing federal exemption is for indebtedness up to $2 million, whereas the new California exemption is for indebtedness up to $800,000 and forgiven debt up to $500,000.

"Qualified principal residence" indebtedness is defined as debt incurred in acquiring, constructing, or substantially…

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Seller wants to accept offer by 12/9/09 and open escrow 12/11/09

   
 

 

The Library Court is a modern building in downtown Los Angeles.  The unit is a 1 bedroom 1 bathroom.  The Library Court Building was originally built in 1955 and renovated in 2004 by the Greystone Group.  The unit has hardwood floors, Granite Counters & floor to ceiling exterior windows.  HOA amenities include 24 hour study area, workout room and business center.  On the ground floor of the building there is a Wolfgang Puck Express and a popular watering hole called the Library Bar.  The Library court building is across the street from the downtown Standard hotel.  This is a great Location in heart of financial district.  There has only been 1 owner of this unit since the…

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