Refinance Free Credit

Foreclosure rates declined in Caifornia during February, according to a report released Wednesday afternoon by data service ForeclosureRadar.

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Foreclosure sales at auction declined 15 percent during the month to 16,931 sales, with a combined loan value of $6.85 billion.

Notices of Default, the first step in the foreclosure process, were also down 7.6 percent to 37,362 — meaning less homes were lost to foreclosure, while fewer borrowers entered the foreclosure process in February. Activity for Notices of Trustee Sale, which serve as harbingers of imminent foreclosure sales, were also down 20 percent to 18,636.

Nonetheless, the overall numbers remain significantly higher than fourth quarter averages, ForeclosureRadar said. Defaults for the month were higher by 26 percent, and foreclosure sales higher by 36 percent, when compared to the three-month average recorded at the end of 2007.

“February declines are a welcome break from the astonishing increases in December and January,” said Sean O’Toole, founder of ForeclosureRadar. “Unfortunately, those increases and the continued withdrawal of lending options point to more trouble ahead. Based on current activity levels, we still do not expect foreclosures to peak earlier than the third or fourth quarter of 2008.”

Lenders continue to take back a substantial 98 percent of foreclosures at auction, despite offering substantial discounts, indicating that investor interest has all but disappeared and REO inventories have continued to grow at accelerated rates.

And that’s despite some strong efforts to keep properties out of the REO bucket, even by lender standards. One year ago, opening bids were discounted 30 percent or more on just 3 percent of sales, ForeclosureRadar said. Today, a full 77 percent of sales are discounted an average of 19 percent, and a whopping 31 percent are discounted 30 percent or more.

For more informtion visit http://www.foreclosureradar.com.

I hear this story time and time again about borrowers being refused a loan because they are trying to finance a loan less than $50,000.  There are 2 reasons why this happens

1. Lenders have guidelines where financing a loan must meet minimum loan requirement due to risk and cost.
2. Mortgage Brokers work strictly on commission and most won't work on a loan that doesn't pay out well.

This is indeed very frustrating for consumers especially the borrowers who really need to refinance to stream line debt or get cash out to help out their current situation.  I do understand their needs and I believe there are answers to this case.

• My company I work for has no minimum loan amount, it also had to do with the Loan Officer - Broker as well.  I personally am committed to every single borrower who needs my help.  I don't look at them as a one time deal commission structure, I look at them as life long clients. ( I want you as a client lets get started) If I do the loan for them now the possibilities are endless for referrals and future financing that might be even more than less than 50k now!

• Another alternative is to do an end run on the minimum loan requirement by getting a home equity loan instead of a first mortgage. An advantage of a home equity loan is that it typically has lower closing costs than a new first mortgage. A disadvantage is that home equity loans and home equity lines of credit have higher interest rates than the typical first mortgage.

• A home equity loan is likely to be the better choice of the two with its fixed interest rate and loan payments that cover both interest and principal repayment.

So don't despair because many lenders turned you down, there are people out there like myself for the borrowers :)

I am so proud to be part of this family and I I couldn't ask for a better lender to work for as a Loan Officer.

Recently I got news that...

Congratulations -- We’re #1 Again!!
A Message From The Retail Leadership Team
For the 16th year running, WFHM is the #1 Retail lender. Congratulations!! This tremendous record is attributable to great teamwork and the dedication of the entire Retail team.

In addition to extending a huge THANK YOU for your efforts, we also want to let you know how important it is to keep the streak alive. With our talented team, the activities we have on deck for 2008, and our competition being “on the ropes,” we know we can extend this streak to a 17th year ... and beyond.

“Wells Fargo is the place to be!”

The 2007 statistics appear below. You will also see a reference to our #1 standing in the Wells Fargo 2007 annual report, due out in mid-March.

Top Retail Lenders 2007
Rank    Lender  Volume (Billions)
1       Wells Fargo     $148.6
2       Countrywide     $145.3
3       Bank of America $125.0

This is just a post to show how appreciative and thankful to work for such 2 major power hitting companies that have formed together a joint venture company called Prosperity Mortgage.  I am proud to be a direct lender and look forward to many homeowners and future homeowners! :)

What could speak louder to our stability, experience, capabilities and credibility? And what better business relationship could you rely on for:

• A demonstrated dedication to the purchase market
• Established relationships with buyers and sellers
• Stellar customer experiences for your buyers

Let’s Take Your Business To The Next Stage® S

• #1 Purchase Money Lender
• #1 New Construction Lender
• #1 Interest-only Mortgage Lender
• #1 Renovation Financing Lender
• #1 Reverse Mortgage Lender
• #1 FHA/VA Mortgage Lender
• A Leading Non-prime Mortgage Lender
• Leading ARM Lender
• Leading Jumbo Mortgage Lender

It's funny I get asked this question almost every day!

There are many stories and articles out there posted by bloggers, news media, analysts, agents etc that try to give a 10 page essay on the market and if its time to buy a house or refinance.  I don't know about everyone else but I like to keep things super simple (K.I.S.S - Keep It Super Simple) We have so many different generation gaps now a days and everyone being the expert we miss the bottom line here.

Can you use a lower payment?

Do you have equity in your house?

Do you want to pay off bills or get cash out?

Want to lower your rate by 2%?

Need to convert to a FIX RATE MORTGAGE?

Bottom line is this, everyday is a good day to refinance if you NEED IT.  Yes there are people out there who don't need to refinance or use their equity but no the market has not STOOD STILL just because the news media is griping about something ....EVERY DAY people still NEED to BUY and SELL houses and EVERYDAY people need to pay off their bills and convert to a fix loan.

To answer the QUESTION is to ask yourself can I use this?  Don't wait for rates to rise or sink...Don't wait till the housing market rise or sink...Nothing is going to change about your situation unless you change it yourself.

Quick Example 

I had a customer worried about his bad credit and didn't know if he could qualify for a loan even.  I just financed him a loan with score's in the 500's and imperfect credit for a 6.25% rate with no points...WOW o WOW, when I was in the Sub-Prime days he would of got at least 9% rate with 4 discount points!!

Heres the Beautiful thing about FHA loans with my company..NO MINIMUM CREDIT SCORE REQUIREMENT!

Yes thats right!  So Bottom line if you need it go for it and call me today your Direct Lender and One Stop Shop for your refinancing needs in Virginia Beach

A widely-watched index of mortgage application activity fell for the second straight week, the Mortgage Bankers Association said on Wednesday. A composite index of all application activity was 652.0 for the week ending March 14, a decrease of 2.9 percent on a seasonally-adjusted basis from 671.7 one week earlier. Applications are running 3.7 percent below last year’s levels, the organization said.

The application index is calibrated to March 16, 1990; a reading of 652.0 means that application activity was roughly 6.5 times greater than when the index was first established.

Both refinancing and purchase applications fell in the past week, with refinancing activity falling 4.6 percent, while purchase applications fell 1.0 percent.

Despite the overall weak numbers, the MBA reported a strong jump of 7.7 percent in applications for FHA loans, as borrowers have flocked to the government-insured lending program amid higher loan limits announced roughly two weeks ago.

Refinance share of mortgage activity decreased to 49.7 percent of total applications, from 50.6 percent the previous week. ARM share fell as well as borrowers moved to fixed-rate mortgages, decreasing to 7.9 from 15.5 percent of total applications from the previous week.

For more information, visit http://www.mortgagebankers.org.

California Attorney General Jerry Brown Jr. on Tuesday shut down four mortgage lenders for providing what he characterized as “illegal and unconscionable loans.” The move was the California AG’s first mortgage bust since taking office — surprising given that California was the epicenter of the housing boom, and that a recent MARI study ranked California in the top five states nationwide for fraud activity.

Lifetime Financial, Nations Mortgage, Greenleaf Lending, Virtual Escrow, Olympic Escrow and Direct Credit Solutions were shuttered for engaging in what Brown characterized as a “complex scheme” of bait and switch.

“As the mortgage crisis worsens, a growing number of fly-by-night companies are employing utterly brazen tactics to push homeowners into illegal and unconscionable loans,” Attorney Brown said in a press statement. “The illegal sales practices of these companies, run by Eric Pony and his family, included psychological pressure, forgery, and outright lies.”

The company used cold-calling tactics that promised unrealistic loan terms to consumers, and then used inflated appraisals to qualify borrowers for mortgages they couldn’t afford; mortgages were usually stuffed with vast amounts of hidden and junk fees, and borrowers — usually facing trouble on the their existing mortgage, or among the elderly — were often forced to sign incomplete loan docs under duress.

Imagine your loan officer showing up at 11:45 at night saying you needed to sign incomplete loan docs because the deal was going away at midnight, and you’d have a good idea of how this company operated.

Yesterday, the Los Angeles Superior Court, at Brown’s request, froze all the companies’ real estate and bank accounts and enjoined them from engaging in further predatory practices. The freeze order also included expensive cars and millions of dollars in private real estate owned by Eric Pony. Brown also said his office is seeking an estimated $20 million in penalties and restitution.

San Bernardino District Attorney Michael A. Ramos also announced Tuesday that several individuals affiliated with Lifetime Financial were arrested this morning on charges including conspiracy, grand theft, forgery and elder abuse. “These predatory lenders have taken advantage of people who placed their trust, as well as their homes, in the hands of these unscrupulous business people,” he said.

In the coming weeks, Brown said his office intends to bring additional legal actions, both civil and criminal, against other mortgage lenders and foreclosure consultants who he said are taking advantage of homeowners across California.

The California AG’s press release provides great detail on the scheme, its perps and the victims. My question: who bought these loans?

We sign the refi papers at 3:30 and our house is safe once again! Foreclosure be gone, I say!

Enough said! ;)

While business may be booming these days, being a foreclosure attorney carries with it a certain stigma — whether deserved or not. Depending on your viewpoint, representing the rights of creditors is either a vital part of our nation’s property rights system or a dirty business. Perhaps even a little of both.

That’s why a small but influential group of attorneys, looking to respond to an almost historic level of industry scrutiny, said earlier this week that they had formed their own political action committee.

“It’s imperative that industry professionals make their voices heard and have an impact on the legislative changes that will affect the legal community, lenders and servicers, as well as the general public,” the group, called the Committee for Actual Real Estate Solutions, or CARES, said in a press statement Tuesday.

“The foreclosure attorneys that represent lenders, servicers, and trustees are in a tough position.”

Mike Roberts, a Little Rock, Ark.-based attorney, will be serving as the primary lobbyist for the organization. Other board members include Gerry Shapiro, founder of the LOGS Legal Network, and Adam Bendett, partner in the New York-based firm of Reiner, Reiner & Bendett, P.C., along with six other well-known industry attorneys.

Joseph Smith, one of the founding board members at CARES and president at Default Mitigation Management, a Kentucky-based loan-workout specialist, said the motivation behind forming the group and its PAC was to provide legislators and policymakers with a “view from the trenches” — something that larger trade organizations, like the Mortgage Bankers Association, often can’t provide.

Solving the current mortgage crisis, he says, is ultimately going to require strong input from the front lines. And — strange as it may seem to some — Smith believes that foreclosure attorneys are in a unique position to provide the sort of insight that other lobbying groups involved in the housing crisis don’t have.

The group wants to push “actual working solutions driven from the day-to-day interaction of borrowers, servicers and law firms,” he said. “The intent of CARES is to push for methods to resolve the current crisis.”

The default industry already has two large attorney-led trade groups, the American Legal and Financial Network and the USFN. Neither group currently maintains a presence on Capitol Hill, however, focusing instead on business development within the industry. Smith indicated that the new organization wanted to take a different focus.

“Members of both those organizations are on the board and in the membership,” he said. “The intent of CARES is to work with any group that has a desire to resolve the issues of the day.”

CARES said it is actively encouraging membership and contributions from legal professionals in the default industry as well as from related industry professionals that want to push for “meaningful and relevant legislative changes.”

Troubled ultra-prime lender Thornburg Mortgage, Inc. said Wednesday morning that it got a much-needed reprieve from its five primary reverse repurchase agreement counterparties and their affliates covering $5.8 billion in repo funding. The lenders agreed not only to reduce their margin requirements, but also agreed to collectively suspend further margin calls for one full year.

On the surface, that’s a pretty strong vote of confidence for a company many had pegged for the bankruptcy line just one week earlier. (And I think I can almost hear cursing from whatever corner office once housed Carlyle Capital’s management, too.)

The benevolent five and their affiliates included Bear Stearns, Citigroup, Credit Suisse, Royal Bank of Scotland and UBS, according to a press statement released by the lender.

“This is an unprecedented collaboration on the part of the company and its reverse repurchase agreement counterparties,” said Larry Goldstone, president and CEO at Thornburg. “This agreement illustrates the high degree of confidence our reverse repurchase agreement counterparties have in the superiority of our origination franchise, the quality of our assets and the strength of our management team.”

But any agreement like comes with some important and costly strings attached: Thornburg will need to raise at least $948 million in new capital immediately to ensure its survival, it said. It will also establish a “liquidity fund” of $350 million and maintain in that fund an amount equal to five percent of the monthly outstanding borrowings from its aggregate repo facilities. The lender will also suspend its common stock dividend for the duration of 2008, it said.

Thornburg also won’t borrow any additional funds in the reverse-repurchase agreement market during the next year, and will give its lenders warrants exercisable into 47 million shares of Thornburg at 1 cent per share. If exercised, the warrants would translate into 27 percent of the company stock outstanding.

Concerns over dilution — and valid ones, at that — sent Thornburg shares down 30 percent in morning trading on the New York Stock Exchange, to $2.08. Nonetheless, a shot at solvency has to be considered a very good thing for the troubled lender, said Goldstone.

“After careful consideration of our available options given the continued challenges in the mortgage securities markets, the company’s board of directors determined that the override agreement and this proposed capital raise and warrants offerings, though highly dilutive for existing shareholders, are in the best long-term interest of the company,” he said.

For more information, visit http://www.thornburgmortgage.com.

Disclosure: The author held no positions in TMA when this story was originally published. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.

Some pretty big guns are aiming to get back into subprime, convinced that either the market is close to bottoming out, or that it has over-reacted. Others still are supremely confident in their ability to seperate the good from the bad. Here at Housing Wire, we’ve been hearing about this for the past few weeks, with different hedge funds firing off presentations outlining a surprisingly similar strategy: there’s got to be value in the subprime mortgage market, and we’re going to find it.

I personally doubt that the market in subprime has flushed its losses just yet; but, at the same time, many hedgies say they’ve been sitting on investors’ money — which means some are likely itching to make a bold play in an attempt to generate an outsized return. And going short on subprime is, as many have said, now too expensive a move.

“Everyone’s short right now,” said one fund manager, who asked not to be named.

What’s a hedge fund with excess capital to do? How about heading back to the ole’ subprime well? Via Bloomberg:

Hedge funds are taking this gamble as the slate of money- making strategies shrinks and profits vanish. Their returns fell 0.5 percent in the first two months of 2008, according to Hedge Fund Research Inc.’s composite index. Managers who specialize in stocks were among the hardest hit as equities markets worldwide tumbled on concern the U.S. economy might be in a recession.

… Hedge funds have raised at least $20 billion to take advantage of the housing recession. Goldman Sachs, whose $10 billion Global Alpha fund fell about 40 percent last year, created two distressed-debt pools with a combined $4.5 billion in assets. Pacific Investment Management Co., manager of the world’s biggest bond fund, has raised $3 billion.

Of course, Goldman and PIMCO aren’t alone. The number of funds out to build a distressed-asset play goes well beyond what could probably be covered in this column. $500 million here, $815 million there, a few billion somewhere else — the point is that a ton of that market liquidity that’s been cited as missing is really more likely to be seen sitting on the sidelines, waiting for something akin to “the right moment” to jump in and start buying.

It doesn’t take a rocket scientist, of course, to predict that the distressed-debt play is going to be big at some point, even outside of subprime mortgages. Think Alt-A, too. That’s why foreclosure auctions across the nation right now are crawling with much more than real estate investors; you’ll often find hedge fund managers in the audience, carefully noting what’s taking place and attempting to get a feel for when they need to make their play.

It’s starting to feel like that moment might be nearing arrival. Which, of course, begs the question: do we really need to be looking to hurriedly push everything over to the GSEs in an effort to restore market liquidity, when that liquidity is already anxiously waiting on the sidelines? I won’t pretend that I have the answer to that sort of complex question, but it’s certainly worth considering.

Editor’s note: If you manage a fund that’s looking to get into distressed-assets — and in particular, looking to make a jump into the mortgage markets — send us an email to feedback@housingwire.com. We’d be interested to learn about your feel for the market, timing and strategy as background for a future story.