HUDSON BEACH
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REAL ESTATE & MORTGAGE
NEWS AND REVIEWS!
TALLAHASSEE, Fla. – June 14, 2010 – Shortly after Orlando Eslava’s bank started to push him through the foreclosure process last year, he got some good news: He was eligible for a government mortgage relief program that would lower his loan payments. But the lender plowed ahead with the foreclosure sale anyway, taking back the condo in Aventura, Fla., even as Eslava made payments under the federal plan.
When a Florida judge learned of the foreclosure, she threw out the case and nullified Eslava’s existing mortgage balance.
Eslava’s case reflects the state of confusion among lenders and courts as they struggle to keep up with a backlog of millions of delinquent homeowners making their way through the foreclosure process. Bank repossessions jumped more than 40 percent in May, to more than 90,000, compared with the same period last year, according to data released Thursday by RealtyTrac, an online service that tracks the foreclosure market.
That uptick is likely to continue this year, and it could take at least three years to work through the backlog of delinquent borrowers, economists say. In many cases, lenders are pushing their cases through overwhelmed courts and facing emboldened homeowners challenging the repossession of their homes on technical grounds.
By the time HSBC began the foreclosure process last year, Eslava, 53, had been trying to get a loan modification for more than a year. In November, a judge approved HSBC’s request to proceed with the repossession and set an April 9 sale date. But after discovering that HSBC could not produce proof that it held Eslava’s mortgage note, the judge ordered the bank to post a $414,000 bond.
The next day, Eslava learned that he was eligible for the federal foreclosure prevention program, which would lower his mortgage payments to $620 a month from about $1,000.
“It was a big relief. Like it was finally going to be over,” Eslava said.
The loan modification should have prevented the foreclosure. But HSBC continued to oppose efforts by Eslava’s attorney, Sheleen Khan, to cancel the foreclosure sale. “All he was looking to do was modify the loan,” Kahn said. “It was very trying for him and nerve-racking for me because we didn’t know what would happen.”
Eslava made several payments under the government relief program, but HSBC foreclosed on the home in April. Kahn filed a motion to overturn the sale, pointing out that in addition to ignoring the loan modification, the bank had not posted the bond required by the judge.
Miami-Dade Circuit Court Judge Jennifer Bailey agreed and brought both sides back to court in early May. Noting that 60,000 foreclosure filings were made in Miami-Dade County last year and that every hearing takes precious minutes, Bailey lambasted the bank’s attorneys for wasting time.
“It doesn’t sound like much, but [every case] represents a situation where the bank’s position is constantly shifting and changing because they don’t know what the Sam Hill is going on in their files,” Bailey said, according to a transcript of the hearing.
“Why did you lose the note? Because you’re operating at the same level of chaos and disorganization that caused you to oppose the motion to cancel the sale when” Eslava had been given a loan modification, Bailey said. A few minutes later, Bailey sanctioned the bank by wiping out Eslava’s mortgage debt. The mortgage note “is null and void. Mr. Eslava is relieved of the debt,” Bailey said.
Eslava, who was not at the hearing, was shocked by the news. He had hoped that the foreclosure would be reversed and that he would remain in the government program. “It’s naturally a good feeling,” he said. “I did everything I was supposed to do.”
HSBC, which as the trustee owns the legal title to Eslava’s loan on behalf of a group of investors, said it does not comment on the specifics of legal matters.
Wells Fargo, which acted as the servicer on the loan, said in a statement: “We work hard to comply with all applicable legal requirements and we expect the firms we work with – in this case, Florida Default Law Group – to do the same. Although this was a technical error on their part, if we make a mistake, we fix it and we hold others we work with to the same high standards.”
Florida Default Law Group, which represented both banks in court, declined to comment.
There have been similar cases in New York and Illinois in which frustrated judges have wiped out a homeowner’s mortgage, but it is still far from a trend, said Diane E. Thompson, attorney on foreclosure issues at the National Consumer Law Center. “I don’t think that homeowners or their advocates should step into court and expect judges to do this for them, even if the lender can’t come up with the note,” Thompson said.
Many states are dealing with the backlog of homeowners winding their way through the process with mediation programs, requiring lenders in some cases to consider a loan modification before moving forward with a foreclosure. Maryland lawmakers approved a similar program this year. “That is a more hopeful trend, and it has the potential to resolve these disputes for everybody,” Thompson said.
Copyright © 2010 washingtonpost.com.
RATES AND MORTGAGES FALL!!!
WASHINGTON – June 14, 2010 – The average rate on 30-year, fixed mortgages is near a record low again, but that may not be enough to bring lots of buyers into the market.
Mortgage finance giant Freddie Mac says the average for a 30-year mortgage is 4.72 percent, down from 4.79 percent a week ago and just a shade above the record low of 4.71 percent reached early last December.
Despite low rates, the Mortgage Bankers Association reported this week that the volume of new mortgage applications for buying homes fell to a 13-year low.
Refinance applications dropped this past week for the first time in a month. Factors behind the drop-off in activity include the fact that many homeowners have already refinanced, limiting the pool of potential applicants.
Millions can’t refinance because they are underwater on their mortgages.
Just over 11.2 million, or 24 percent, of all homes with a mortgage were worth less than the outstanding loan balance at the end of March, according to CoreLogic.
Still others can’t refinance because their credit has been damaged by missing payments due to lost income as a result of the recession.
“We’re not attracting a lot of new refinance customers at this level because customers have refinanced and they don’t have a lot of equity,” says Michael Fratantoni, vice president of research and economics at MBA.
The volume of mortgage applications for purchasing homes is now 35 percent lower than four weeks ago, because many buyers left the market after a homebuyer tax credit expired at the end of April.
The federal tax credit provided up to $6,500 for repeat buyers and up to $8,000 for first-time homebuyers.
“We’re on the backside of the tax credit,” says Mark Zandi of Moody’s Economy.com. “With the expiration of the credit, now the markets are weakening. I was surprised by the strength of the credit (on the market), so we’ll be surprised by the strength of the weakening.”
The tax credit did boost sales. Pending home sales have risen for three consecutive months. April’s were up 6 percent from March and 22.4 percent higher than April 2009, according to the National Association of Realtors (NAR). That follows month-over-month gains of 7.1 percent in March and 8.3 percent in February.
Existing-home sales jumped 7.6 percent in April and were 22.8 percent higher than in April 2009.
“It’s still not easy to get a mortgage,” says Joel Naroff of Naroff Economic Advisors. “I don’t know why people think this housing market is going to bust out. ... It’s going to be a long process.”
Copyright © 2010 USA TODAY, a division of Gannett Co. Inc., Stephanie Armour
FOR WHATS IT'S WORTH
Did you realize that we have been going through this crisis in the mortgage industry for over 5 years now? Well, most of us Realtors do.
Do you also realize that within that 5 years there has never been any kind of action taken to help the short sale process
or to help the American People.
The refinancing act only helped 2% of all the people that applied for help. There were so many stipulations that it was almost impossible to qualify.
My questions is to you, Mr. Lender, Mr. Banker and Mortgage Brokers. Why haven't you got together and came up with guidelines to get these short sales done and through the process.
A short sale should take no longer than 90 days from start to finish. OK...you say I don't know what I'm talking about. Well, I do know this..there is a word called co-operation.
If we all decided that we needed to cooperate and get this back log finished, would this not be an asset?
No more 3 years waiting for a home to go through the foreclosure process because the lenders are now co-operating with one another.
The court system is not with countless paperwork where the attorneys continue to get rich off the American People that are losing their home.
We are Americans...and as that can we not work together to get this albatross over?
Your Opinion is greatly appreciated....
Thank You,
Katie Creek
727-415-4669
Email: kdsrealestate@yahoo.com
Update to this article. It is April 2011, and the FTC Mortgage Relief Services knows as (MARS) have required us to put in print the following:
Florida Luxury Realty is not associated with the government, and our service is not approved by the government or your lender. Even if you accept his offer and use our service, your lender may not agree to change you loan. If you stop paying your mortgage, you could lose your home and damage your credit rating.
Of course...this pertains to the Short Sale Process only. However, we must print this any time we use the word Short Sale in any of our advertising or articles.
