Short Sales Riches Blog » fannie mae

New home sales will be up?

admin — Mon, 26 Jul 2010 16:27:58 +0000

Smart Real Estate News & Commentary by Chris McLaughlin July 26, 2010

Forward this e-mail to your friends!

Then they can subscribe directly at the following link:

http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

**********************************************************

Come learn from Nathan J.’s mentor who will do all your deals for you…

TODAY at 3 PM ET, NOON PST:

https://www2.gotomeeting.com/register/331982995

**********************************************************
New home sales will be up?

According to outlook and commentary services firm Econoday, new home sales should total 310,000 units in June, up from May’s record-low 300,000. The Census Bureau is scheduled to release its monthly new home sales data later this morning. The error ratio, however, could swing the new home sales into negative territory, month-on-month, as the possible range is listed between 280,000 to 350,000 home sales. Months’ supply of new homes on the market surged to 8.5 months in May, from 5.8 months in April, due to the drop in sales, Econoday noted in commentary. But the actual number of new homes on the market was down 1,000 in the month to an adjusted 213,000 — to its lowest level in 40 years, since 1970, the firm said. Econoday noted that lower interest rates are likely to boost sales for the June data. Employment and income growth, however, also have an impact on the decision to buy housing.

More magic numbers from the WH

The numbers, projections, and estimates that come out of the White House under this administration are famous for their inaccuracy and fantasy-like quality, but even it is slowly coming around to reality, admitting that unemployment will stay at or above 9% until 2012. Of course, we can expect the truth to be varnished at least a little bit…well, maybe a lot: it now believes the 10-year deficit will be $58 billion less than projected in February when the budget blueprint was first released, and that the economy will grow by at least 4% in 2011 and 2012. Under the revised estimates, Uncle Sam will ring up $8.474 trillion in deficits between 2011 and 2020, down from the $8.532 trillion estimated in February. In the near-term, the administration expects the 2010 deficit to come in at $1.47 trillion — slightly lower than originally forecast and slightly above last year’s deficit of $1.41 trillion. Meanwhile, the 2011 and 2012 deficits will come in somewhat higher than the White House forecast in February.

“The economy is still weaker than we’d like, and [there is] a medium-term and long-term fiscal situation that requires attention,” outgoing White House Budget Director Peter Orszag said in a call with reporters. In terms of taxes, the administration now expects that the Treasury will take in $402 billion less over the next 10 years than originally expected, but at the same time will also spend $461 billion less than was forecast. The tax revenue collected will average 18.7% a year, slightly above the 40-year historical average. Federal spending, however, will average 23.2%, above the 20.7% historical average. When asked what accounted for the White House’s relatively optimistic growth estimates relative to other economists’ forecasts, Christina Romer, who chairs the president’s Council of Economic Advisers, said the administration believes rapid growth in business investment and an emphasis on U.S. exports is “what we think makes these numbers completely reasonable.” In other words she has no real basis for any of it…business as usual.

Freddie’s mortgage and issuance $179bn in H110

Mortgage purchase and issuance at Freddie Mac rose to $30.9 billion in June, from $25.1 billion in May, bringing the year-to-date total to $179 billion for the first half of 2010 (HI10), according to a monthly volume summary. Freddie’s total mortgage portfolio decreased at an annualized rate of 0.9% in June. Total guaranteed Participation Certificates (PCs) and structured securities issued fell at an annualized rate of 0.6%. The monthly contraction in the portfolio arrives after Freddie wrapped up an initiative announced in February to purchase essentially all the single-family mortgages delinquent by 120 or more days out of its PC pools. The single-family delinquency rate decreased to 3.96% in June from 4.06% in May, and the multifamily delinquency rate fell to 0.28% from 0.32%. Refinance-loan purchase and guarantee volume was $19.1 billion in June, up from $17.1 billion in May. Freddie reported 21,367 modifications in June, for a total 93,558 in the first six months of 2010. The aggregate unpaid principal balance of the mortgage-related investments portfolio slipped by $8.6 billion.

Soak the rich

Treasury Secretary Timothy Geithner said yesterday that the economy is not likely to slip back into recession, but letting tax cuts for the wealthiest Americans expire is necessary to show commitment to cutting budget deficits. “We think that’s the responsible thing to do because we need to make sure we can show the world that (we’re) willing as a country now to start to make some progress bringing down our long-term deficits,” he said on ABC’s “This Week” program. In other words, pretend the economy is great, soak the people most likely to invest in private enterprise, and call it “responsible.” Geithner said only 2 to 3 percent of Americans — those making $250,000 or more a year — will be affected when tax cuts enacted under former President George W. Bush end on schedule this year.

Republicans want to extend the tax cuts and Democrats are divided but Geithner said reductions for top earners should end. There’s another way to be responsible, of course, and that’s by not driving the country into the wall at exactly the wrong time with programs we can’t afford, but no one in the administration has stumbled on that idea yet. “I think the most likely thing is you’ll see an economy that gradually strengthens over the next year or two, you’ll see job growth start to come back, investments expanding … but we’ve got a long way to go still,” Geithner said. Indeed. In fact, for some reason this administration is intent upon making it as long as possible…

DSNews.com – GSEs next?

Now that the Obama administration is finished “fixing” financial regulatory reform, it’s setting its sights on restructuring the housing finance system, namely the GSEs. The White House says it will put forth a formal proposal by early next year, and some say its focus will be a departure from the age-old adage of homeownership as everyone’s “American Dream,” and shift support for the housing market from Fannie Mae and Freddie Mac to the private sector. There’s no doubt change is coming for the nation’s two largest mortgage companies. Many were disconcerted that the Dodd-Frank Wall Street Reform and Consumer Protections Act didn’t include a new blueprint, or at least new rules, for Fannie and Freddie.

Rep. Darrell Issa (R-California), ranking member of the House Oversight and Government Reform Committee, called the president’s signing of the Dodd-Frank bill a “charade” on true reform, particularly in light of Issa’s recent investigation that revealed former executives at both Fannie Mae and Freddie Mac accepted so-called sweetheart loans from subprime mortgage lender Countrywide before it imploded. Since the federal government took control of the GSEs in September 2008, the two companies have had to draw $146 billion in federal funding to stay afloat, giving taxpayers an 80 percent ownership stake in the mortgage financiers. Fannie and Freddie’s rescue has become the costliest of all the government bailouts, making the fact that the two companies were never mentioned in a bill that promises to end “too-big-to-fail” even that much more ironic. Recent estimates from the Congressional Budget Office (CBO) put the tab for subsidizing Fannie and Freddie at $389 billion, when all is said and done.

Now for our real estate education section…

Bills, Bills, Bills – How Reform is Changing the Face of Real Estate

Whether you like him or not, one thing everyone can agree upon is that President Obama has indeed kept his promise to bring change to the nation. From healthcare reform to finance reform, some of the most radical changes in decades have come to pass with profound implications for the future of real estate.

Although superficially healthcare reform may not seem to have a direct impact on real estate, upon closer examination it becomes clear additional taxes (including the 3.8 percent premium on investment earnings for high net worth individuals, the upcoming requirement to send 1099’s to every company or service provider which you do more than $600 of business with annually and other upcoming changes) required to fund the measure will indeed directly affect investors. Finance reform presents a myriad of new taxes, decreased write-offs and stringent lending regulations likely to transform the mortgage and banking industry for decades.

But the worst may be yet to come in the form of the upcoming energy bill. “What energy bill?” you ask…the one that has been in the works since the Supreme Court ruled that carbon dioxide is a poison which must be cleaned up. As an environmental pollutant, the ruling gave the EPA (Environmental Protection Agency) oversight that directly affects business and industry throughout the nation with or without a new bill. However, experts and politicians alike expect an energy bill to be put through sooner rather than later.

What possible implications could this hold for the future of real estate?

Apparently a lot especially when “Carbon credits” are taxed into the equation of a new home, roads and other improvements. The cost of electricity and other fuel based services are also likely to increase…along with the cost of goods which use fuel or electricity.

What other areas should savvy short sale and real estate investors keep an eye on? How about VAT taxes, Cap & Trade modifications, Climate bill, Privacy bill and a new living wage bill just for starters. In fact, even proposed revisions to the “No Child Left Behind” law is expected to impact real estate since one of the major predictors of home value and neighborhood desirability is related to school performance. Under the proposed changes, a single federal formula will be used to calculate and report high school graduation rates and other statistics…including the federal funding and ability of parents to remove children from schools or obtain vouchers….all of which are likely to impact the desirability of any given home or neighborhood.

See you at the top!

Chris McLaughlin
**************

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************
About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month
   * Long-time authority on real estate investing
      and rapid reselling of distressed homes. Owns
      portfolio of nearly 100 high-value, high-profit
     properties
    * Owner of one of Florida’s largest Real Estate firms,
     running 4 different offices, supporting over
     400 agents, uniquely positioning him to help
     thousands of investors make money in the
     biggest market opportunity ever!
   * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
      in Real Estate Investing, Entrepreneurship, and
      Wealth Building
  * Follow me on Twitter: http://twitter.com/mclaughlinchris
    * Join my Facebook Fan Page: http://www.mclaughlinchris.com
–

HUD wants a FICO of 500

admin — Mon, 19 Jul 2010 20:18:31 +0000

Smart Real Estate News & Commentary by Chris McLaughlin July 19, 2010

Forward this e-mail to your friends!

Then they can subscribe directly at the following link:

http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

**********************************************************

Fix A Flip Re Opens … If you want your deals funded beyond 1 day,

this is the webinar you need to be on this coming Tuesday at 8:30 PM ET, 5:30 PM PST:

https://www2.gotomeeting.com/register/618365627

**********************************************************
HUD wants a FICO of 500

The Department of Housing and Urban Development (HUD) said that it intends to require borrowers to have scores of at least 500 to qualify for FHA-insured loans. The agency has not required a minimum score before. “It really is just conforming FHA standards to what FHA lenders have already been doing,” said Michael Fratantoni, vice president of research and economics for the Mortgage Bankers Association. As a result, the practical impact of this move will be extremely limited; during the second quarter of 2010, no FHA-insured loans were issued to borrowers with sub-500 scores. And, in fact, less than 1% of borrowers were below 580; most loans went to borrowers with scores above 620.

The initiative is part of an ongoing effort to reduce default risk to the FHA loan portfolio and to boost the reserves that back those loans, according to HUD Commissioner David Stevens. “These are the latest in a series of changes to allow the FHA to manage its risk better while continuing to support the nation’s housing recovery,” he said. “By protecting FHA’s capital reserves, we can continue providing affordable, responsible mortgage products and will remain the nation’s largest source of home purchase financing for underserved communities.” During May, 8.97% of all FHA loans were seriously delinquent (seasonably adjusted). That was up from 7.93% during May 2009. But defaults have turned downward since January, when they peaked at 9.16%. The defaults have drained FHA reserve, which is funded by insurance payments, to below the 2% minimum mandated by Congress. Taxpayer money could be in jeopardy if the insurance funds are depleted any further.

Hiring up slightly

According to a survey by National Association for Business Economics (NABE), employers grew payrolls for a second consecutive quarter this year. The percentage of firms increasing staff levels grew to 31% in the quarter, versus only 6% in the same period a year ago, while at the same time, the percentage of employers cutting jobs continued to move lower. Looking ahead, the survey showed that 39% of companies expect to add employees over the next six months, the highest level of planned hiring since January 2008. “The labor market continued to improve, with increases in current hiring and a rise in the percentage of firms planning to add workers over the next six months,” William Strauss, an economist at the Federal Reserve Bank of Chicago, said in a statement.

The U.S. unemployment rate stands at 9.5% as of June. The jobless rate has averaged 9.7% over the first half of the year, and many economists expect it to remain elevated into 2011. The survey, based on responses from 84 NABE economists who work for private-sector firms and industry trade associations, also indicated that the pace of the economic recovery slowed in the second-quarter. Industry demand grew at a slower pace in the quarter, the survey said. Corporate profits grew as price and cost pressures remained tame. About one out of four firms increased capital spending versus the previous quarter, and a growing number expect to continue investing over the next 12 months, according to NABE. While economic activity is expected to remain positive this year, more economists lowered their expectations for 2010 gross domestic product. Only 20% of prognosticators expect GDP will grow more than 3% this year.

Asking prices up slightly

After increasing for the first time in nine months in May, asking prices for active home listings were virtually unchanged in the June reading of the Altos Research 10-city composite price index. In addition, inventory of existing homes for sale increased both in June and for Q210. The June median listing sales price for single-family existing homes was $477,937 in June, down $146, about 0.03%, below the May 2010 median of $478,083 for homes in Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, New York, San Diego, San Francisco, and Washington DC. Altos Research said 13 of 26 markets it tracks reported increases in asking sales prices for homes during the month of June.

For Q210, asking prices were up in 14 markets. San Francisco led both categories with a 2% in June and an increase of 4.4% quarter-over-quarter. Following San Francisco in asking price increases was San Jose (1.5% in June, 2.5% in Q210), Austin (1%, 1.7%), Dallas (0.9%, 2.2%) and Cleveland (0.8%, 1.5%). The market with the biggest decrease was Phoenix, down 2.4% from June and 3.9% in Q210, followed by changes in Miami (-2.3%, -4%), Washington DC (-0.8%, 0.4%), Las Vegas (-0.6%, -0.9%) and Boston (-0.5%, 0.1%). Listing inventory totaled 304,831 properties in the 10-city composite, up 2.8% and 5.4% for the quarter. Chicago was the only market where listing inventory decreased in June, but the area was still up 0.7% for the quarter. While Detroit posted a 1.6% increase in listing inventory during June, it was the only market with a decrease in listing inventory for the quarter, down 2.1%. San Francisco lead all markets in inventory volume, up 7.6% in June and 13.5% for the quarter.

Antidote to an anti-business agenda?

Because of the perception that Obama is anti-business and his policies are causing small and large businesses to hunker down and wait out the witch hunt, House GOP Leader John Boehner said he supports a ban on all new federal regulations, after meeting Friday with business lobbyists who complained about uncertain economic conditions. “I think having a moratorium on new federal regulations is a great idea. It sends a wonderful signal to the private sector they may have some breathing room,” Boehner said. He said any ban would include an exemption for “emergency regulations” for some agencies, and suggested it could last a year. Boehner and Illinois Republicans Peter Roskam and Aaron Schock convened a group of nearly 20 Washington-based business leaders on Friday who represent various sectors — including homebuilders, retailers and manufacturers — as part of their “America Speaking Out” initiative to gather ideas for the GOP legislative agenda. Roskam said those in the meeting reported that a significant obstacle to the economic recovery is “the down-talking of the private sector, the rhetoric.”

“The anti-business rhetoric that they see coming out of Washington is more than just symbolic.” Roskam added. “It’s creating a great deal of uncertainty.” The people in the meeting repeatedly criticized the approach to the economy taken by the Obama administration and congressional Democratic leaders, criticizing excessive federal spending and burdensome government regulations. Jay Timmons from the National Association of Manufacturers maintained the United States is “becoming one of the most risky places in the world in which to do business.” But Timmons did make a pitch for both parties to come together, saying, “It takes a bipartisan effort to get this economy moving again.” Naturally, Ryan Rudominer, spokesman for the Democratic Congressional Campaign Committee, seized on the GOP meeting Friday to argue it would result in “a Republican agenda written for lobbyists by lobbyists.” Apparently it’s better to have a Democratic business agenda written by social activists?

BoA encourages short sales

Bank of America (BoA) reported $35.7 billion in nonperforming loans, leases and foreclosed properties in Q210 – which is 15% above levels measured in the same quarter of last year. These loans and properties increased more than $5 billion in total aggregate balance since Q209. The total did drop by more than $200 million worth of these loans and properties from the $35.9 billion reported in Q110. They represented 3.74% of all outstanding loans, leases and foreclosed properties at the end of Q210. Since 2008, BofA and the acquired Countrywide completed nearly 650,000 loan modifications. During Q210 alone, BofA completed 80,000 modifications, including 38,000 trial modifications that were converted into permanent workouts under the Home Affordable Modification Program (HAMP). If a modification does fail, BoA is putting an emphasis on selling the home through a short sale ahead of foreclosure. At REO Expo 2010, Matt Vernon, the short sale and REO executive at BoA said that the bank added 1,000 employees to the short sale staff and will “do everything possible to liquidate property prior to foreclosure.”

Now for our real estate education section…

The 15 Minute Resolution…How to Generate Free Leads with Craigslist

This week’s 15 minute resolution is a simple but super effective way to put the power of CraigsList to work generating free leads. No spam, no expensive software and best of all…hardly no time is involved!

Everyone in real estate has probably tried to use Craigslist to buy or sell real estate; it’s powerful, free and frequently used by people throughout the entire nation. Unfortunately, it’s also slow, behind the times and a major drain on time for those that try to sort through pages and pages of dull links and competitors advertisements.

Now it’s possible to change all that with just 15 minutes of time and these quick steps:

1. Visit Google keywords or any of your favorite keyword finder to create a list of real estate/short sale related keywords. Great examples might include “motivated seller”, “commercial property”, “investment income” or any other relevant words that signify the type of property you are seeking.

2. Visit www.Craigslist.com and select the state and city of your choice. Copy the url exactly as it appears in the url address bar.

3. Visit the Google Advanced Search page at http://www.google.com/advanced_search?hl=en

- In the second line of the advanced search (where is says “this exact wording or phrase”) type in the keywords previously outlined one at a time.

- Scroll down the advanced search page to the bottom where it says “Search within a site or domain” and put the Craigslist.com url exactly as it appears in the address bar.

- Indicate the number of listings, whether you would like to receive results via email (or forward to your phone) and other parameters such as price. Viola’…that’s it! Now you are ready to start receiving instant leads via Craigslist for free. Not only will this save time and money when working with Craigslist but it’s a simple way to begin building a contact list in your local area or across the nation.

See you at the top!

Chris McLaughlin
**************

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************
About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

Smart Real Estate News & Commentary by Chris McLaughlin July 1, 2010

admin — Thu, 01 Jul 2010 17:25:37 +0000

Forward this e-mail to your friends!

Then they can subscribe directly at the following link:

http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

**********************************************************

IT’s BACK: NO FLIP RICHES REOPENS THIS SATURDAY!

When you know how to defeat the top 9 issues that are stopping profitable short sale investing today, you’ll rapidly rise to the top of the real estate elite! (Imagine — you the guru!)

Here’s what we’ll reveal in this free online DVD and one-hour class:

*Details on each of these 9 threats – even if you don’t have a clue now How to get around them, and get up and running in less than a day

*How to target markets with NONE of these problems, with eager sellers and starving buyers eager to hand you cash… you’ll be a hero just for giving them what they need.

*When and how to fill your short sale funnel with high-margin deals… and rake in HUGE profits regularly

*Create multiple income opportunities — because after your first flip, done this new way, you simply wash, rinse, and repeat your way to a fortune!

* Best part — with this new strategy, it’s like it’s 2008 all over again… where you can generate an autopilot, dependable, predictable, and steadily soaring income that’ll create enough wealth to retire for good!

It’s time to get excited…

Make sure you wait for the gotowebinar page to redirect you to obtain the free DVD and tune in to the encore Saturday at 3:00 PM ET, NOON PST:

https://www2.gotomeeting.com/register/159690035

**********************************************************
US Congress Backs Home Tax Credit Extension

The U.S. Congress on Wednesday approved a bill extending the closing deadline for homebuyers trying to take advantage of a popular tax credit. Homebuyers with contracts signed by April 30 who failed to go to closing by the June 30 headline will now have until September 30 to complete their purchases. The $8,000 tax credit for first time homebuyers and $6,500 credit for others purchasing a new primary residence was a highly popular temporary measure by the administration to jump start home sales during the economic recession. Real estate agents said thousands of homebuyers would miss the June 30 deadline because banks and settlement offices were struggling to deal with the volume of people rushing to close on their deals. Senate Republican Leader Mitch McConnell offered a two month extension that was paid for by using unspent money from last year’s economic stimulus program and Democrats objected.

Wall Street reform Bill Approved – Pitfalls galore

The House of Representatives passed the Wall Street Reform Bill, in what is touted as the most sweeping change of the administration. The Wall Street Reform Bill is showcased as one that will make the U.S.’ financial system more transparent, and put an end to the idea that any financial firm is too big to fail, and therefore entitled to taxpayer bailouts. Sharing his views, the House Republican Conference Chairman, Mike Pence, alleged that under the guise of financial reform, Democrats are pushing yet another Bill that will kill jobs, raise taxes and make bailouts permanent.

“This legislation will kill jobs by restricting access to credit. It will kill jobs by raising taxes on those that would provide loans and opportunities to small business owners and family farmers. And it makes the bad ideas of the Wall Street bailout permanent,” he said. “I vigorously opposed the Wall Street bailout because I thought it departed from that fundamental principle of personal responsibility and limited government. And I rise today to vigorously oppose this legislation that takes the bad ideas of the Wall Street bailout and makes them permanent,” Mr. Pence said. What this means is that When a financial firm is failing, Treasury Secretary and the FDIC will actually have the authority to take taxpayer dollars and decide which creditors to pay back, and how and when they get paid, giving the government bureaucrats more power to pick winners and losers.

Fannie Mae Mortgage Portfolio to Fund More ‘Dead Assets’

The Fannie Mae mortgage portfolio passed $813bn in May, climbing $24bn from April, according to its monthly summary. It is interesting to watch, how much debt Fannie will issue to fund more “dead assets.” Fannie could issue more debt paid back to investors at scheduled times and at the investors discretion, also known callable debt. The growth shown in May was financed mostly by this short-term borrowing, according to Vogel. “Fanie will have clear sailing for is next benchmark on Wednesday, July 7 with no Treasury supply and limited corporate competition in front of earnings announcements,” Vogel wrote.

He added another $5bn in issuance “is certainly possible.” Fannie issued $36.2bn mortgage-backed securities (MBS) in May, a 3.7% drop from the $37.8bn mark in April and a 71.9% decrease from the $129bn issued in May 2009. MBS issuances reached its peak in the last year in June 2009, when Fannie issued more than $130bn in MBS. In May, Fannie purchased another $49bn of loans out of MBS trusts as part of its effort to buy-out seriously delinquent pipelines. That’s up from $46bn in April.

Commercial/Multifamily Real Estate show signs of stability, in First Quarter 2010

The Mortgage Bankers Association (MBA) today released its Commercial Real Estate/Multifamily Finance Quarterly Data Book for the first quarter of 2010. The analysis shows that commercial real estate fundamentals are beginning to show signs of stabilization, though property and mortgage performance remains weak. As economic growth continues, the impact on commercial real estate markets should broaden and reach rents, vacancies and delinquencies. The Data Book compiles the most up-to-date information on topics of interest to commercial / multifamily real estate finance industry participants and observers including rends in property sales, originations, delinquencies and mortgage debt outstanding.

The Housing Market, still lost in the Woods

As the administration’s mortgage and housing officials sing their own praises, the Treasury and the Department of Housing and Urban Development released a new monthly “housing scorecard” in an attempt to show that the administration is making progress in its efforts to heal the market. With rehashed statistics and numbers from various sources, many of them can be interpreted as “stable,” far from the truth. But what some observers miss is that “stabilization” is temporary and is brought about by tax credits, very low interest rates and other forms of government intervention. “Obviously, we are not out of the woods. Our housing market remains fragile, and we still may see further declines,” said HUD Secretary Shaun Donovan told reporters.

We already have seen evidence of very steep declines in newly contracted home sales since April 30, the deadline for home buyers to qualify for tax credits of up to $8,000. But that drop won’t show up in Tuesday’s report from the National Association of Realtors on May home sales because that will reflect sales that were completed in May, not new contracts signed. The Treasury also released its monthly update on the administration’s $50 billion drive to prevent foreclosures, known as the Home Affordable Modification Program, or HAMP. By the end of May, 429,696 trials had been canceled, up from 277,640 a month before. Nearly 468,000 households are still in trials, and 190,000 of them have been in limbo for at least six months, as loan servicers, slowly work through their huge backlogs of unresolved cases. Another big problem remains: Even after HAMP modifications, many borrowers still face crushing overall debt burdens, when credit cards, car loans, student loans and other obligations are considered.

Now for our real estate education section…

Facts, Figures & Other Tidbits That Make a Real Difference

Admit it. Most people don’t have a head for facts, figures and statistics. Except for a few special people that seem to thrive on data and obscure calculations, just the mere mention of facts and figures tends to cause people to start shifting in their seat and looking for the nearest exit. This is NOT one of those situations. Today we are going to cover a few facts and figures that make a very real difference in your real estate and investing career. Things you can put to work and take straight to the bank. Try these out and see for yourself.

1. Establish a ratio. Not just any ratio…a ratio that has been proven effective. Burn this number into your brain and use it as a foundation for growth and maintenance. Research conducted by top agents and businessmen indicated a 34:1 ratio to successfully close one deal. Notice, these are successful agents so novice investors may need to use a higher ratio when first starting however, nothing says that each contact must be time consuming or made in person. Learn how to use social media to dramatically reduce the time, effort and expense to meet this criteria. Bottom line: make contact with an average of 34 buyers/sellers for every deal you close….but worker smarter not harder by using social media.

2. Increase your odds. One of the biggest mistakes most people make when investing in real estate is to think the little things don’t matter. They do. Take the above ratio as an example. It’s tempting to believe that making contact with only 25 people instead of 34 is sufficient. Don’t believe it. Do the math and you will soon realize the impact on your business at the end of the year is likely to be a full 30 percent less than the person who maintained the 34:1 ratio instead! Take away…to grow your business you must not just meet the standard ratio but rather exceed it. Instead of retaining the 34:1 ratio you might need to adopt a 45:1 ratio but remember, by using social media it is possible to work smarter rather than harder while growing your business and profits.

3. Focus on one skill and delegate the rest. Veteran real estate professionals have learned the fine art of delegation but there is one skill that you should NEVER delegate…do you know what it is? Not only is it one of the most crucial skills to business success but it’s where the money is. In fact, it’s probably not an overstatement to say this is the single most important part of your business…yet the majority of real estate professionals are unable to identify this skill when asked. Even worse, many actually delegate this to others…a practice akin to handing over their business.

Have you guessed yet? Plan and simple…lead generation. Consider this, real estate entails several core competencies including lead generation, presentations to buyers/sellers, marketing, negotiation, contracts, coordination of closing etc…nearly all of these are technical considerations that can be clearly defined and cost estimated to a narrow margin because they are predictable in terms of time and cost. Lead generation is different. Research has shown that top agents are able to convert nearly 80 percent of leads into successful transactions…novice agents and outside vendors average as little as 10 to 20 percent. Why pay more for less? Remember, the secret to success is to be in front of a qualified prospect when they are ready to buy – not when you are ready to sell. Learn how to use social media marketing to meet your objectives and find ready buyers by joining one of our free webinars.

See you at the top!

Chris McLaughlin
**************

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************
About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

Smart Real Estate News & Commentary by Chris McLaughlin June 30, 2010

admin — Wed, 30 Jun 2010 20:07:18 +0000

Forward this e-mail to your friends!

Then they can subscribe directly at the following link:

http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

**********************************************************

X-Bank Foreclosure Attorney And Millionaire Real Estate

Investor “Attorney X”… Who has over 15 years of proven

Success under his belt… Is going to Reveal Insider Investor

Secrets The Banks Don’t Want You To Know…

On this Free Content Packed Webinar You’ll Learn…

- How To Acquire As Many Properties As You Want, Without

Ever Needing To Apply For A Loan Or Use Any Of Your

Own Money… (This is an absolutely REVOLUTIONARY strategy)

- How “Attorney X’s” student “Will”, picked up 71 properties

in less than 6 weeks using this EXACT strategy… (Unbelievable!)

- How another one of “Attorney X’s” students got a 65%

PRINCIPAL REDUCTION on her property… (Amazing!)

…And so much more, simply enter your info below and

reserve your spot now for FREE TONIGHT at 8:30 PM ET,

5:30 PM PST:

https://www2.gotomeeting.com/register/710760107

**********************************************************
Freddie Mac Short Sales Up 600% from 2 Years Ago

Freddie Mac CEO Ed Haldeman said the company has seen the number of its short sales increase 600% from 2008 as lenders look to dampen the impact of foreclosures hitting the marketplace. In a statement put out this week, Haldeman said Freddie Mac is doing everything it can to prevent more foreclosures, and that short sales are becoming an ever-popular tool in situations where foreclosure is imminent and modifications have failed. That number could increase as the Home Affordable Foreclosure Alternatives (HAFA) program takes hold. The Treasury Department launched it in April to provide cash incentives to servicers for conducting short sales and deeds-in-lieu of foreclosure.

RealtyTrac, an online foreclosure marketplace, is even preparing a short sale report to go long with its usual foreclosure report every month. It won’t be available until the end of 2010 however. “Foreclosure alternatives like short sales and deeds-in-lieu help borrowers to avoid the stigma of foreclosure, shorten the waiting period before they can buy a new home, and may inflict less damage on their credit reports,” Haldeman said. While short sales still add to the housing supply and can put pressure on local home values, they often avoid the lack of maintenance or damage foreclosed homes often display. Since the middle of 2008, Freddie Mac reported total losses of $84.4bn, according to its quarterly reports. The company’s plight has forced a directive from the Federal Housing Finance Agency (FHFA), its conservator, to de-list its and Fannie Mae’s common stock from the New York Stock Exchange.

Foreclosures sell at 30% discount

Foreclosures accounted for a third of all sales — and sold at a nearly 30% discount — during the first three months of 2010. According to a new report from RealtyTrac, the marketer of foreclosed properties, 31% of all sales were foreclosures. And homebuyers purchasing those properties paid a whopping 27% less, on average, compared to sales of non-distressed homes. These foreclosure sales include properties sold in short sales or after a bank repossession, known as REOs in industry terms. It does not include transfers from borrowers to banks, as in a sheriff’s auction. Foreclosures have become a dominant feature of many real estate markets, finding willing buyers among young bargain hunters and savvy housing market veterans. Foreclosure sales were highest, expectedly in the bubble states of Nevada, Massachusetts, Rhode Island and Florida. Lenders have been trying to manage their inventories of foreclosed homes to prevent them from flooding the market and dragging down prices. The impact of foreclosure sales on the home sales market can have a depreciating effect on the entire inventory out there.

Wall Street reform bill reformed

Lawmakers came up with an alternative plan to save the Wall Street reform bill falling flat in the Senate. After key moderate Republicans who had supported earlier versions of reforms threatened opposition, Democrats leading negotiations in the Senate and House scrapped an effort to pay for reforms by taxing big banks and hedge funds to the tune of $19 billion. Instead, they agreed to pay for Wall Street reform by ending the $700 billion federal bailout program called the Troubled Asset Relief Program (TARP) immediately upon final passage of the bill. Lawmakers would redirect the stream of bailout repayments as well as untapped dollars to offset shortfalls created by the Wall Street reform bill, which spends money by creating new agencies. The move would offset $11 billion in spending. Republicans involved in financial reform talks balked and tried to get Democrats to cut the federal stimulus program to pay for Wall Street reforms. “This ranks right up there at the top of the list for pure deception for treating the American taxpayer in an inappropriate way,” said Sen. Judd Gregg, R-N.H. The full House is expected to take up the bill Wednesday.

Mortgage Refinance Applications Increase as Rates Continue to Drop in Latest MBA Weekly

The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending June 25, 2010. The Market Composite Index, a measure of mortgage loan application volume, increased 8.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 8.3 percent compared with the previous week. The Refinance Index increased 12.6 percent from the previous week and is the highest Refinance Index observed in the survey since the week ending May 22, 2009.

The seasonally adjusted Purchase Index decreased 3.3 percent from one week earlier. The unadjusted Purchase Index decreased 3.8 percent compared with the previous week and was 36.0 percent lower than the same week one year ago. “Amid continuing financial market volatility, mortgage rates dropped again last week, with rates on 15-year loans reaching a record low for the MBA survey. Refinance applications jumped in response, but remain at about half the level seen in the spring of 2009,” said Michael Fratantoni, MBA’s Vice President of Research and Economics. “Purchase applications declined for the seventh time in the last eight weeks, keeping the purchase index near 13-year lows.”

Diana Olick – Is Home Ownership an American Right?

“Maybe the government doesn’t want to deal with Fannie Mae and Freddie Mac. just yet, but that doesn’t mean we should all just ignore the fact that these two ticking time bombs continue to support more than half of the mortgages in this country and the bulk of new originations. Is home ownership an American right? The government appears to say yes. In my piece on CNBC today, I relate through the history of just how we got to this ownership society…the politics, policies and politicians behind home ownership. But here I’d like to take the conversation forward. We know how we got here, and we know what happened when home ownership went completely haywire. Now the politicians are calling for “responsible” home ownership, and yet government continues to pour billions of dollars into programs and incentives that push more borrowers into homes that may not be the best fit. Today the S&P Case Shiller Home Price Index showed an improvement in home prices over the same period last year. California is leading the way in recovery.

But in an interview with David Blitzer of S&P, you would have thought prices fell through the floor again. Blitzer’s claim is that prices should be recovering far better and faster than they are. He cites the disappointing fact that nine of the top twenty cities hit new price lows at some point since the beginning of this year. And then there’s the concern that the gains are artificially boosted by the home buyer tax credit which expired April 30th.

Which all brings me back to my original thesis: Government gets involved in the housing market, the housing market surges and then that same housing market inevitably pays the price when government pulls out. This is not to say that there aren’t some good, long-term programs out there to spur home ownership for deserving, low-income buyers, but the idea that the government was somehow going to jump start home buying with a tax credit, and then that car would just keep on driving, really couldn’t work in this market. Government, yes, has a responsibility to save the banking system from a total meltdown due to bad mortgage debt, but the future of housing, of home ownership, needs to reinvent itself without artificial stimuli. Americans have to get back to basics, and by basics I mean affordability, responsibility, and plain common sense. Government is not famous for any of those.”

Now for our real estate education section…

Facts, Figures & Other Tidbits That Make a Real Difference

Have you guess yet? Plan and simple…lead generation. Consider this, real estate entails several core competencies including lead generation, presentations to buyers/sellers, marketing, negotiation, contracts, coordination of closing etc…nearly all of these are technical considerations that can be clearly defined and cost estimated to a narrow margin because they are predictable in terms of time and cost. Lead generation is different. Research has shown that top agents are able to convert nearly 80 percent of leads into successful transactions…novice agents and outside vendors average as little as 10 to 20 percent. Why pay more for less? Remember, the secret to success is to be in front of a qualified prospect when they are ready to buy – not when you are ready to sell. Learn how to use social media marketing to meet your objectives and find ready buyers by joining one of our free webinars.

See you at the top!

Chris McLaughlin
**************

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************
About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

Smart Real Estate News & Commentary by Chris McLaughlin June 25, 2010

admin — Fri, 25 Jun 2010 18:49:12 +0000

Forward this e-mail to your friends!

Then they can subscribe directly at the following link:

http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

**********************************************************

Fudging Homebuyer Tax Credit

Some homebuyers are angling to claim the $8,000 tax credit even though they missed the deadline. To claim the credit, buyers had to sign contracts by April 30 and close the sales by June 30. But real estate agents say some buyers are demanding quick closing dates to meet the June 30 deadline, even though they failed to meet the April 30 deadline. And because the IRS doesn’t require paperwork specifically proving the contract date, they might get away with it. Claiming the credit does require more than sending in your taxes and asking for the money. Buyers have to fill out a special form and attach a copy of their settlement statement, which they receive at closing.

“People do have to submit documentation,” said an IRS spokesman. But, the settlement statement does not require the contract date — just the “date of purchase,” which is the closing date. “It’s just illegal,” said Tara-Nicholle Nelson, a real estate broker, attorney and an accredited buyer’s agent and a spokeswoman for Trulia, the real estate Website. “But if everyone in the transaction is colluding, it would be difficult to catch.” Along with the IRS, even the Treasury Inspector General is keeping quiet, despite releasing a report on Tuesday about other abuses of the homebuyer tax credit – including prisoners claiming the benefits. “Even if we did know about it, we probably wouldn’t comment,” an IG spokesman said.

U.S. Lawmakers arrive at New Finance Rules

Lawmakers early Friday finished melding the House and Senate Wall Street reform bills, bringing Congress closer to passing the most sweeping changes to the financial system since the New Deal. The new bill will redefine U.S. financial markets and firms. After many months of negotiations between House and Senate lawmakers, the White House, banks, brokerage firms and consumer groups came to an end as 43 lawmakers agreed to send to their respective chambers a final bill that aims to strengthen consumer protection, shine a light on complex financial products, create a new process for taking down giant, failing financial firms, and make them stronger to prevent such failure.

The breakthrough came after conference members reached compromises on controversial derivatives language; new limits on banks’ ability to invest in hedge funds and using their capital for trading; the contours of a new consumer protection agency; and the government’s ability to handle the failure of a large financial institution. A key part of the legislation is overhauling the way government officials assess and respond to systemic risks to the economy. The legislation would empower the Fed to supervise the large, most complex financial firms, and couples that with the creation of a Financial Stability

Oversight Council made up of federal financial regulators.

Fannie Mae gets tough on homeowners who walk away

The courts will now come to the mortgage giant’s plans to take on those who decide not to make their payments. It also will limit their access to future loans. Foreclosures continue at a rate of 2.5 million a year, Federal Deposit Insurance Corp. Chairwoman Sheila Bair said, and some 11 million households owe more on their mortgage than their home is worth. Taking aim at homeowners who are able to pay their mortgage but decide it’s not worth it, Fannie Mae plans to go after them in court and to limit their access to home loans for seven years. It was a clarion call to companies servicing its loans to recommend, engaging in a so-called deficiency judgment — a court order requiring a defaulting borrower to pay any remaining unpaid portion of the loan after a seized home is sold.

Under California state law, lenders who opt for court proceedings can obtain a deficiency judgment if the mortgage was used to refinance a home, but not if it was used to finance a purchase.

Fannie Mae also said it would make new mortgages harder to obtain for borrowers if it can be proved that they engaged in a “strategic default” — abandoning a home to foreclosure not because the required payments are unaffordable but because the mortgage is larger than the value of the residence. For such a borrower, Fannie said it would not buy or guarantee another home loan for seven years. Borrowers who are slightly underwater — owing just a little more than their homes are worth — are unlikely to stop paying their mortgages if they have the resources, according to studies by research firm CoreLogic. But if the home’s value is at least 25% less than the loan amount, borrowers are far more likely then to walk away. Last March, 31% of foreclosures were described as strategic by the borrowers themselves, compared with 22% in March 2009, researchers at the University of Chicago and Northwestern University reported.

Diana Olick – Fannie Mae: Walk Away and You Will Pay

“Dare I say it? “What took you so long??” An announcement from government-owned mortgage giant Fannie Mae warns: “Defaulting borrowers who walk-away and had the capacity to pay or did not complete a workout alternative in good faith will be ineligible for a new Fannie Mae-backed mortgage loan for a period of seven years from the date of foreclosure.” I have to ask: Why only seven years? Up the ante! Look, I understand that a lot of folks are sitting on overwhelming bundles of negative equity in the form of four walls. A very credible argument can be made that a bad investment should not be a jail term. However, a lot of the housing crash was based on a fundamental change in attitudes toward home ownership, i.e. that a home is an investment before a dwelling.

The pendulum needs to shift back, not all the way, but more toward the traditional use of home: A place to live, not an A.T.M. “Fannie Mae will also take legal action to recoup the outstanding mortgage debt from borrowers who strategically default on their loans in jurisdictions that allow for deficiency judgments,” notes the press release. I’m wondering why they haven’t been doing that all along? My guess is they simply don’t have the legal resources available to handle such a huge job…which brings me to my final thought: If the mortgage walk-away issue is big enough for Fannie Mae to get this tough, then why have Administration officials been telling me over and over that “it’s just not that big an issue.” Seriously, I’ve done several interviews over the past year, bringing it up over and over, and they just seem to want to sweep it under the rug. I guess the rug is getting a bit too bumpy.”

Nearly 1 Million lose jobless benefits

Nearly a million people have lost their unemployment benefits because the Senate failed for the third time Thursday to extend the deadline to file for this safety net. The Senate trimmed down the bill yet again on Wednesday night so that it would only increase the deficit by $33.3 billion over 10 years, instead of $55.1 billion. The main changes were to scale back additional Medicaid funding for the states and to reallocate some stimulus and Defense Department spending.

As the bill will be pulled, many groups will be left in a flux, including the jobless who have lost their safety net, companies who are waiting to learn what tax breaks are extended, and governors who were counting on the additional funds to balance their budgets. The grab-bag legislation pushes back the deadline to file for federal unemployment benefits until the end of November, renews expired tax provisions, lengthens a small business lending program and adds to infrastructure investments. More than a million people are expected to run out of benefits this month, according to the National Employment Law Project.

DSNews.com – 70% of Modifications in May Were Non-HAMP: Report

Mortgage servicers completed 112,088 loan modifications through their own proprietary programs in May, according to a report released this week by HOPE NOW. That compares to 47,724 new permanent modifications under the government’s Home Affordable Modification Program (HAMP) during the same month. Altogether, just over 159,000 mortgage modifications were completed in May, bringing the total number of mods for the year to 800,536, HOPE NOW’s data shows.

In addition, HOPE NOW says private-sector servicers completed 213,000 other workouts in May, such as repayment and forbearance plans. Faith Schwartz, senior advisor for HOPE NOW, said, “The latest results continue to support the industry’s unprecedented efforts to assist borrowers across the country using myriad foreclosure prevention programs.” However, Schwartz noted that 3.77 million borrowers are currently 60 or more days late on their mortgages. HOPE NOW’s data shows that foreclosure actions were started on 205,479 properties in May alone. Foreclosure sales during the month totaled 98,963. Mortgage servicers have apparently offered distressed borrowers more than 9.5 million total workout solutions, including more than 3.2 million loan modifications.

Now for our real estate education section…

Friday File – 15 Minute Resolution

Are you fully recognizing the full potential that real estate has to offer as an investment? Find out with this week’s 15 minute resolution. Take this quick quiz to see if you are missing one of the many ways to turn a tidy profit with real estate investments:

1. Fix and Flip. Short sales are great ways to make thousands or even tens of thousands of dollars in a very short period of time.

2. Buy and Hold. Now is one of the best times to purchase real estate rentals or as long term buy and hold investments; prices are low, interest rates at rock bottom and many new homes with extended lifespan are available.

3. Tax Liens & Certificates. Recognize returns of 10 to 18 percent without ever stepping foot on a property.

4. Be the Banker. Buying bank notes, owner financing, holding a full or partial note, reselling notes, factoring…there are many ways to “be the bank” without over-extending your personal resources.

5. Diversify. Even if you participate in each of the above, it might be time to take it to the next level by purchasing commercial properties, multi-family, raw land, developments or other forms of real estate such as agricultural, commodity or even international holdings.

6. Syndication. Not for the novice, syndication has long been used by many of the most savvy real estate investors in the industry.

7. Surplus Land Sales. One of the most overlooked yet lucrative ways for beginners to get started…not to be confused with tax liens or certificates.

So, how did you score? Are you using real estate to its fullest? If not, it’s time to get serious about your portfolio. Sign-up for a free daily newsletter or join one of our free webinars to learn how to maximize profits, minimize efforts and make the most out of all that real estate has to offer.

See you at the top!

Chris McLaughlin
**************

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************
Finally, a blog for Real Estate professionals
that want up-to-the-minute news, & how it impacts
us and our market…
http://www.shortsalesriches.com/blog

*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

Smart Real Estate News & Commentary by Chris McLaughlin June 18, 2010

admin — Fri, 18 Jun 2010 18:27:11 +0000

Forward this e-mail to your friends!

Then they can subscribe directly at the following link:

http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

**********************************************************

Tax Lien Certificates: The Guaranteed Solution for Financial Freedom

Here’s Just Some of What You’ll Learn:

• How to Safely Earn 18% – 36% Interest per Year Complete Guaranteed by the Government.

• How to Safely Invest in Tax Lien Certificates anywhere in America from the Comfort of Your Own Home.

• How to Secure a Consistently Monthly Cash Flow of an Extra $1,200.00 — $7,800.00 per Month or More!

• How to Get Started with Any Dollar Amount – Highly Profitable Investments for as Little as $20 or as Much as $100,000++.

• How to Get Started Completely in Your Spare Time in as Little as 4 – 10 Hours per Week Even if You’re a Beginner.

Join us tomorrow (Saturday) at 3:00 PM ET, NOON PST:

https://www2.gotomeeting.com/register/790330787

****************************************************
CNBC’s Diana Olick – Oil and Real Estate: Fannie Mae to the Rescue

“There is no question that while oil has barely brushed the beaches here in Pensacola, the place is awash in fear. But then a ray of hope…from none other than the government-controlled mortgage behemoth Fannie Mae, which is in so much hot water itself that it actually had to delist from the stock market yesterday. “Servicers may immediately suspend or reduce mortgage payments for borrowers whose properties or income are negatively impacted by the Gulf oil spill,” goes the press release.

“We want to give homeowners every opportunity to weather this unprecedented disaster, including relief from their mortgage payment if that will help them get back on their feet and stay in their homes,” said Michael J. Williams, President and CEO. “Our policy is in place to support those who are experiencing a disaster-related hardship through no fault of their own and are acting in good faith to meet their mortgage obligation.”

This is part of the company’s (or should I say agency’s) “Special Relief Measures” policy. Borrowers can get up to 90 days of relief while the servicer “determines the nature and extent of the impact the disaster is having on the condition of the property or on the borrower’s financial condition.” And what then? “At the conclusion of that assessment, servicers have additional flexibilities to evaluate the appropriate loss mitigation alternative based on a case-by-case determination, including an additional three months of forbearance, a loan modification or other customized solution.”

Sounds great, if this were, like, 1997, and the housing market was otherwise fine and dandy. So many Floridians are already in the midst of trying to get loan modifications and forbearance plans, that I’m just not so sure how you separate it all around here. But then I think about the government, which has been trying to pull itself out of the housing market, and is now just dipping itself right back in. I wonder just how this announcement is going to affect underwater borrowers in Florida, even those who don’t live near water. The very process of deciding who is really a victim of oil and who is just a victim of the ongoing housing crisis? Just the mechanics of it! I’m sure far greater minds than mine in the upper levels of our government have already thought of that.”

Suggestions from MBA to the Administration on the Future of the Housing Finance System

The Mortgage Bankers Association (MBA) yesterday submitted a comprehensive response to a series of questions from the administration designed to elicit input on the future of the housing finance system, including Fannie Mae and Freddie Mac, and the overall role of the federal government in housing policy. Michael D. Berman, CMB, MBA’s Chairman-elect, said “We have spent the better part of the last year and a half looking at how to attract private capital and restore confidence in the secondary mortgage market. We want to work with the administration and Congress to find long term solutions that will ensure sufficient mortgage liquidity in times of market stress.”

MBA’s comments builds on the work of its Council on Ensuring Mortgage Liquidity, a 23-member task force, chaired by Berman, representing MBA’s diverse membership base. MBA established the Council in October of 2008 with a mission to look beyond the current crisis, to what a functioning secondary mortgage market should like for the long term. Discourage a fully private model to fund the US housing finance system, the response states that a fully-government based system may not be optimal, comments on why the role of the government in the core mortgage finance market should be neutral and separate from other housing policy goals, and establishes the need for the government to provide an explicit credit guarantee as the secondary mortgage market transactions are funded with private capital and many more to the boot.

Tax, Jobs Bill Blocked in U.S. Senate

A Democratic bill to extend jobless benefits and raise taxes on investment fund managers failed a key vote in the U.S. Senate Thursday, dealing a blow to President Barack Obama’s push to boost the economy. The bill would have extended popular business tax breaks, stopped a 21 percent Medicare pay cut for doctors treating elderly patients and extended extra Medicaid money to cash-strapped states. Democratic leaders failed to muster the 60 votes needed to overcome solid Republican opposition to the bill, which would have added about $55 billion to the deficit over 10 years. Republican opponents argued that the bill would add billions to an already bloated $1.4 trillion budget deficit. The deficit and $13 trillion national debt are becoming major issues in the November midterm congressional elections in which Republicans hope to gain control of Congress.

Consumer Price Drop Squeezes Profits

Many companies are finding their profit margins squeezed, as U.S. consumer prices fell 0.2% last month from April, even as commodity prices from metal to fuel to food remain higher than they were a year ago. The Labor Department Thursday said that excluding volatile food and energy prices, consumer prices rose a modest 0.1% in May. Compared to a year ago, prices, excluding food and energy, have risen only 0.9%, the smallest increase since 1966. Such a scenario should buoy weary consumers especially at a time of high unemployment and worries about the turmoil in Europe. But it puts many companies in a bind as they digest rising wholesale prices, which push up their production and operating costs. Many companies say they are reluctant to pass price increases to consumers who are still jittery from the recession.

Across the economy, budding concerns about inflation coming out of the economic downturn have morphed into worries about inflation being too low as products face intense price pressures. Outside of energy prices, “there’s nothing out there to point to inflation picking up,” says James O’Sullivan, chief economist at MF Global. “Inflation is very tame.” The one benefit of a weak economy: plenty of available labor, keeping wages under control.

Mortgage Fraud Task Force Arrests 485 in Sweeping Crackdown

Since the launch of a national mortgage fraud enforcement campaign on March 1, federal efforts led to 485 arrests nationwide, making it the largest-ever collective enforcement initiative against mortgage fraud. The effort, dubbed “operation stolen dreams,” is headed up by US Attorney General Eric Holder, Federal Bureau of Investigation (FBI) director Robert Mueller III and Housing and Urban Development – Office of Inspector General (HUD-OIG) Kenneth Donohue. The mortgage fraud crack-down has uncovered 1,215 criminal defendants nationwide — including 485 arrests — who are allegedly responsible for more than $2.3bn in losses.

To date, the operation resulted in 191 civil enforcement actions resulting in the recovery of more than $147m: “From home buyers to lenders, mortgage fraud has had a resounding impact on the nation’s economy,” said the FBI’s Mueller. “Those who prey on the housing market should know that hundreds of FBI agents on task forces and their law enforcement partners are tracking down your schemes and you will be brought to justice.” The types of alleged mortgage fraud cases uncovered and investigated include builder bailout schemes, where builders establish relationships with unlicensed mortgage brokers to “sell” homes to straw buyers at inflated prices. Fraudulent schemes also involved “ghost loans” where straw buyers misleadingly obtain loans on properties that have multiple unrecorded liens without the other lender’s knowledge. As the breeds of mortgage fraud grow more exotic and damaging, federal investigations are also picking up.

DSNews.com – House Republicans Want Penalties for Strategic Defaulters

Tumbling property values have left nearly a quarter of borrowers owing more on their mortgage than the home is worth, and A recent study has shown that when underwater, more and more of these homeowners are opting to walk away from their loan obligation even if they can afford to make the payments. While defaulting strategically is not as frowned upon by the general public as it used to be, there are some lawmakers whose disdain for the practice has sparked a push to institute stronger deterrents for walking away and penalize those that do. Last week, the U.S. House of Representatives passed the FHA Reform Act, with measures designed to replenish the Federal Housing Administration’s (FHA) depleted reserve. The FHA reform bill, including the agency ban on strategic defaulters, has not yet been approved by the Senate. And some onlookers say the part targeting borrowers who up and walk away will be particularly tricky.

Now on to our real estate education section…

Friday File – 15 Minute Resolution: Simplify Your Life

Ever have the feeling you are drowning in data? Can’t seem to find the name or number of a specific person despite duplicate numbers at home, the office, phone, laptop and desktop? Wish there was an easy way to consolidate all your contacts into one simple, convenient place that you can sync and export anywhere at any time…including cross platform from Mac and PC? This weeks’ 15 minute resolution does all that thanks to Google Contacts.

Get Control of Your Entire Social Network

1. Linkedin, Facebook, email, phone, Outlook and others…make a list of all the people and places you visit.

2. Sign up for a Google Contacts Account. It’s simple and free. If you have a gmail account, simply sign-in and click to get started.

3. Export your CSV phone list and save to your computer.

4. Log-in to Google Contacts, click on “import”.

5. Do the same for LinkedIn. Simply “export” the CSV file to your computer then upload to Google.

6. Facebook is a little more complex as it requires the use of a couple add-ons to grab both the phone and email information. Greasemonkey provides a popular script capable of integrating with the Facebook Phonebook exporter script located at http://bradfitz.com/greasemonkey/facebook_phonebook_export.user.js

7. Remove duplicates. Google Contacts handles this effortlessly…just look for the button and click!

8. Sync and Export. If you own an Adroid, no extra steps are required since Google Contacts is already integrated, otherwise, you will need to set up the phone to sync with Google. Likewise, to export the list, simple select the file format, download to the computer and then follow your program instructions to import contacts into the email or other application.

See you at the top!

Chris McLaughlin
**************

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

Smart Real Estate News & Commentary by Chris McLaughlin June 2, 2010

admin — Wed, 02 Jun 2010 16:26:50 +0000

Forward this e-mail to your friends!

Then they can subscribe directly at the following link:

http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

**********************************************************

Special 100% Content LIVE Webinar TODAY at 2 PM ET, 11 AM PST:

“How to Use Foreclosure Defense Strategies to Get

More Time For Your Short Sale.”

Here’s the link to join on Wednesday at 2 PM ET, 11 AM PST:

https://www2.gotomeeting.com/register/593296611

**********************************************************

ENCORE: Find Private Lenders NOW

Thursday, June 3rd at 8:30 PM ET, 5:30 PM PST

https://www2.gotomeeting.com/register/678281378

Private Lenders are everywhere, even right in your backyard, and I’m going to show you how to find them this Tuesday night.

Most real estate investors don’t even know this list exists.

The list is INSANELY valuable…and on Tuesday we are going to

show you how to get all the data within a couple clicks of your mouse. Jump on this now:

https://www2.gotomeeting.com/register/678281378

****************************************************

US Home-Buying Loan Demand Falls for 4th Week

Demand for loans to buy U.S. homes fell last week for the fourth straight week, holding 13-year lows, as the housing market adjusted to a selling environment without the federal tax credits that had stoked April sales, the Mortgage Bankers Association said on Wednesday. Total loan applications eked out a 0.9 percent rise in the week ended May 28, seasonally adjusted, as a 2.4 percent in refinancing demand offset a decline of 4.1 percent in purchase loan requests to the lowest level since April 1997. A so-called “hangover” from more than a year of the tax credits had been widely expected, and most economists expect U.S. housing can stand on its own footing as the year progresses. “This volatility in activity is the price paid for higher average levels of sales across the year as a whole than would have occurred without the tax credit,” Ian Shepherdson, chief U.S. economist at High Frequency Economics, wrote on Tuesday. Buying a home, for qualified purchasers, remains affordable with mortgage rates historically low and prices down about 30 percent on average from their peaks in 2006. But at least in the weeks since the tax credits expired, homeowners are concentrating on shaving costs by refinancing. Still, refinancing is also experiencing “burnout,” with fewer people acting to refinance each time mortgage rates fall near current levels, Michael Fratantoni, MBA’s Vice President of Research and Economics Fratantoni said in an interview. The MBA’s refinance applications index has risen for four straight weeks to its highest level since October 2009. The refi index, at roughly 3,300 last week, is well below the most recent peak of about 7,400 in early January 2009 when 30-year mortgage rates were roughly similar.

Mortgage Refinance Applications Go Up, Purchase Applications Go Down

The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending May 28, 2010. The Market Composite Index, a measure of mortgage loan application volume, increased 0.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 0.3 percent compared with the previous week. The Refinance Index increased 2.4 percent from the previous week. This was a smaller increase than in previous weeks, but was still the fourth consecutive weekly increase for the Refinance Index and it remains at its highest level since October 2009. The seasonally adjusted Purchase Index decreased 4.1 percent from one week earlier. The Purchase Index decreased for the fourth consecutive week and is currently at the lowest level since April 1997. The unadjusted Purchase Index decreased 5.2 percent compared with the previous week and was 16.8 percent lower than the same week one year ago. Purchase applications are now almost 40 percent below their level four weeks ago, while the refinance share, at 74 percent, is at its highest level since December,” said Michael Fratantoni, MBA’s Vice President of Research and Economics. “In addition, the ARM share dropped last week to its lowest level since March of this year, as borrowers took the opportunity to lock in at historically low fixed mortgage rates.” The adjustable-rate mortgage (ARM) share of activity decreased to 5.2 percent from 6.0 percent of total applications from the previous week.

Goldman Sachs Spies A Way Out Of Fraud Claims

As the clock is ticking on the SEC’s case against Goldman Sachs, both may be allowed to declare victory as Sachs is finding a way to compromise. Sometime in the next few weeks, Goldman will either go to federal court with a substantive denial of the SEC’s allegations or agree to a settlement. They are still far apart, as Sachs is denying intentional fraud on its part. For Goldman Sachs settling or not resisting the fraud accusation will amount to reputational damage. More importantly, the company is concerned about the host of private class-action lawsuits that would surely follow any SEC settlement. The SEC, however, cannot afford to be seen going easy on Goldman. It has managed to avoid having its authority stripped away in the financial reform process—the bills passed by both the House and the Senate largely keep the SEC independent and its authority intact—but it has been stung by criticism that lax enforcement of securities laws contributed to the financial crisis. Goldman might accept a settlement if the civil charges requiring fraudulent intent or claiming a scheme that operated as fraud were dropped, a source said, leaving open the charge of merely negligently “misleading” the investors in the Abacus deal. Goldman could still wind up paying a huge fine—some have estimated the fine could amount to $1 billion, the highest ever paid by a single firm. Goldman does not seem confident that a deal will definitely be reached. Sources say Goldman is still preparing a full-fledged defense even as talks with the SEC continue. The firm has been posturing behind the scenes, indicating that it believes it could uncover weaknesses in the government’s case during the pre-trial discovery phase.

DsNews.com – GSEs to Begin Accepting HAFA Short Sales

Fannie Mae and Freddie Mac both issued new guidelines to servicers Tuesday, which allow homeowners with GSE loans to pursue a short sale or deed-in-lieu of foreclosure if they are unable to secure a modification under the government’s foreclosure prevention program. When the Treasury’s Home Affordable Foreclosure Alternatives (HAFA) program rolled out in early April, officials explained that the GSEs’ loans were not eligible. Treasury officials said that they were anticipating Fannie and Freddie to launch their own short sale-friendly programs – and those announcements came Tuesday. Both Fannie Mae and Freddie Mac encouraged servicers to begin implementing their HAFA procedures “immediately.” By August 1, 2010, all Fannie Mae and Freddie Mac servicers must have incorporated HAFA into their operations and begin offering HAFA solutions to eligible borrowers. The program is effective through December 31, 2012. Like the original HAFA guidelines issued from Treasury, Fannie and Freddie loans must first be found eligible for the Home Affordable Modification Program (HAMP). If the borrower then fails to fulfill their HAMP obligations, a HAFA short sale or deed-in-lieu will be offered, but unlike the non-GSE HAFA program, Fannie and Freddie stipulate that HAFA can be applied only after “all other home retention workout options have been exhausted.” The GSEs will pay servicers $2,200 for a HAFA short sale and $1,500 for every HAFA deed-in-lieu completed. Borrowers are entitled to an incentive payment of $3,000 to assist with relocation expenses.

Half of Americans Can’t Afford Large Down Payments on Mortgages

Of more than 2,000 respondents to a survey conducted by the National Foundation for Credit Counseling (NFCC), nearly half — 49% — believe they will never afford a 20% down payment to purchase a home. In the past, finding the money for a down payment was only a problem for first-time homebuyers, the NFCC said. After making the first purchase, borrowers could use the proceeds of selling it as a down payment on the next one. That was in an appreciating market, however. “Due to today’s turbulent housing market, the problem has now spread to those who currently own a home. Many mortgages are underwater. Thus, even if the homeowner is able to sell their current house, there may be no profit available to satisfy the down-payment on the next home,” according to the NFCC survey report. Gail Cunningham, a spokesperson for the NFCC, said with home prices averaging at just below $200,000, a 20% down payment – $40,000 – is “a nice chunk of change by any standard.” While 12% of the respondents said they would have no trouble coming up with a 20% down payment, 20% said they would need a loan with a much lower down payment, and 18% said they would have to borrow the down-payment money regardless of how much is required. Considering the staggering number of people who are out of work and those whose retirement plans have been decimated, buying a home may no longer be a part of the American dream, at least not in the near future,” Cunningham said.

Now on to our real estate education section…

Crisis Economics

In his most recent released book “Crisis Economics – A Crash Course in the Future of Finance, Nouriel Roubini aka “Dr. Doom” lives up to his reputation by relating a rather bleak outlook for worldwide financial indicators Despite the overwhelmingly negative prognostications presented, Roubini makes a series of startling projections worthy of review. Real estate investors would do well to take notice of Dr. Doom’s dire prognostications in order to protect – and profit- from the future of finance.

1. Forget the black swan – focus on the white swan instead. Roubini takes on the popular theory presented by Nissan Taleb and instead demonstrates that events are indeed much more predicable than many experts would like to admit. Despite claims to the contrary, Roubini presents strong evidence that not only were the recent series of unfortunate events predictable, they are increasingly probable given the attitudes and actions taken by those in power.

Takeaway: By examining crisis economics, we can prevent or at least profit from markets behaving badly.

2. Capitalism is in Crisis. Although Marx was the first to predict it, capitalism has not proven to be as an efficient of a market as originally anticipated. Instead, it is marked by upheaval and crisis on a fairly regular basis.

Takeaway: The current crisis is following an anticipated trajectory which is likely to favor the prepared.

3. Deflation versus Inflation. Deflation has the net effect of increasing the debt burden while inflation has the effect of decreasing the debt burden. Although currently the United States and the real estate market as a whole has experienced a period of deflation (especially as it pertains to real estate), the overall long term impact is likely to become inflationary.

Takeaway: Prepare your portfolio by investing in inflationary hedges like real estate and precious metals.

4. Derivative Destruction: Think the worst is over? Think again – the worst may be yet to come thanks to destructive derivatives which have yet to implode/explode. Despite recent attempts by the Obama administration to address the CDO and derivative market, the intrinsic complexity of these investments has limited the full impact.

Takeaway: Rock bottom may still be in the future. Plan accordingly.

5. “Creative Destruction” is likely if not necessary. As the private and public sectors seek to reign in the damage, expect to see greater levels of “creative destruction” take place; from breaking up big banks to imposing regulatory firewalls on financial systems, changes is on the horizon.

Takeaway: Business and banking will grow increasingly complex – and expensive – in order to addres new mandates and revised risk levels.

See you at the top!

Chris McLaughlin
**************

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

Smart Real Estate News & Commentary by Chris McLaughlin, May 21, 2010

admin — Fri, 21 May 2010 19:02:27 +0000

Forward this e-mail to your friends!

Then they can subscribe directly at the following link:

http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

**********************************************************

FIX A FLIP OPENS SATURDAY AT 3 PM ET, NOON PST!

We’re bringing it back! Fix-a-Flip funding will re-open

up this Thursday with even more updated fast-flipping

strategies and new partnerships with capital

providers. And we’ll be sold out again in record time.

Go here to get what you’re missing out on in a fr-ee

webinar Saturday at 3 PM ET, NOON PST:

https://www2.gotomeeting.com/register/899839235

**********************************************************

Mortgage Rates Hit New Lows in Two Weekly Surveys

Mortgage rates dropped again this week, setting new records in two weekly surveys, the result of investor flight from European investments. The Freddie Mac weekly survey put the average rate for a 30-year fixed-rate mortgage (FRM) at 4.84% with a 0.7 origination point for the week ending May 20, down from last week’s average of 4.93%. A year ago, the 30-year FRM averaged 4.82%. The 25-year-old Bankrate.com weekly survey of large banks and thrifts put the average rate for a 30-year FRM at 4.96% with a 0.5 origination point, the lowest in the history of the survey.

Despite the end of the Federal Reserve mortgage-backed securities (MBS) purchase program, mortgage rates are at their lowest point all year. As Europe responds to the Greek debt crisis, the euro is plummeting compared to the dollar. Investors are turning to American investments that, for the moment, seem safer. However, some argue that debt levels in the US are also as risky as in Europe. “People rush to us for ’safety,’ although we’re Greece — we just haven’t gotten there yet,” Anthony Sanders, distinguished professor of real estate finance at George Mason University, told Bankrate.com. Sanders added US interest rates will rise once European and Chinese economies recover. Freddie said the 15-year FRM averaged 4.24% with an average 0.7 point, down from last week’s average of 4.3% and a year ago, when the average was 4.5%. Freddie said the five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.91% with a 0.6 point, down from last week’s average of 3.95% and a year ago, when it averaged 4.79%. It’s the lowest average rate for the product since October 2004, when it averaged 3.96%.

Senate Passes Finance Bill

The Senate on Thursday approved the most extensive overhaul of financial-sector regulation since the 1930s, hoping to avoid a repeat of the financial crisis that hit the U.S. economy starting in 2007. The legislation passed the Senate 59 to 39 and must now be reconciled with a similar bill passed by the House of Representatives in December, before it can be sent to President Barack Obama to be signed into law. The controversial measure, supported by the Obama administration, sets up new regulatory bodies and restricts the actions of banks and other financial firms. It is designed to try to make order of the cascading regulatory chaos that ensued in 2008 when mammoth banks and some unregulated financial firms collapsed, and public funds were used to save them.

Among other things, the legislation would: a)Establish a new council of “systemic risk” regulators to monitor growing risks in the financial system, with the goal of preventing companies from becoming too big to fail. (b) Create a new consumer protection division within the Federal Reserve charged with writing and enforcing new rules that target abusive practices in businesses such as mortgage lending and credit-card issuance. (c) Empower the Federal Reserve to supervise the largest, most complex financial companies to ensure that the government understands the risks and complexities of firms that could pose a risk to the broader economy. (d) Allow the government in extreme cases to seize and liquidate a failing financial company in a way that protects taxpayers from future bailouts. (e) Give regulators new powers to oversee the giant derivatives market, increasing transparency by forcing most contracts to be traded through third-parties instead of only between banks and their customers. “It will inevitably contract credit,” said Sen. Judd Gregg (R., N.H.), who says the Senate bill “is probably undermining the system, probably making for a weaker system.”

Sen. Gregg was one of 37 Republicans to vote against the 1,500-page bill. Now Congress will need to reconcile the Senate bill with a companion House package adopted in December on a 223-202 vote, with 27 Democrats joining unanimous Republican opposition. The outlines of the two bills are largely the same. But there are more than a dozen notable differences that will need to be reconciled during negotiations that are expected to start within days. Despite the differences, the Senate passage virtually ensures that some type of financial regulatory reform will be finalized by this summer.

Diana Olick – US Housing Prices to Rise Slightly in 2010: Poll

“U.S. house prices will manage a small gain in 2010 after the worst crash since the Great Depression but gains in coming years are likely to come slowly, a Reuters poll found. Home sales and prices may retreat in the near-term after government tax credits to homebuyers as large as $8,000 ended on April 30, economists and property market analysts said. But that trend will be countered by historically low mortgage rates and the fact that housing affordability is now near the best it has ever been, likely putting prices back on a slow upward path.

Three-quarters of the economists polled May 14-19 said it was possible that average house prices would return to where they were in 2006 before the crash — which would require a rise of more than 40 percent — but that it would take a long time. Home prices as measured by the Standard & Poor’s/Case-Shiller 20-city index should rise 1.4 percent this year and 3 percent next year, breaking three years of sharp declines, according to the median forecast. “The recovery is likely to be longer and more arduous than many expect,” said John Silvia, economist at Wells Fargo. The homebuyer credit, which the government expanded and broadened to include repeat as well as first-time buyers, stole many future sales as buyers rushed to lock in deals before the April 30 deadline.

Buyers put away their checkbooks in the first weeks after the credits of $6,500 for repeat buyers and $8,000 for first-time purchasers expired. But there are reasons to be optimistic. Most economists say the recovery now can be sustained without government help and that home prices are fairly valued. But banks still need to put the record supply of repossessed houses on the market, which will keep prices from recovering very quickly. “A toxic combination of weak demand and high supply will generate a double-dip in prices now that the tax credit has expired,” said Paul Dales, U.S. economist at Capital Economics, who expects a 4 percent fall in prices next year.”

What’s in the Wall Street Bill

The Senate’s final version of Wall Street reform runs close to 1,600 pages. It takes a broad swipe at the rules that govern the financial sector. It aims to prevent future financial crises. It establishes a new consumer regulatory agency. It throws down new rules on complex financial products and creates a new way for the government to take over failing financial firms. The bill, which the Senate passed Thursday night, must now be reconciled with a similar measure the House approved last December. Here’s a breakdown of key measures in the Senate legislation. Among others, the bill creates a new process for unwinding big financial firms. Banks would be taxed to pay for unwinding banks after a collapse. Also, the Federal Reserve would be able to make emergency loans only to banks that are otherwise healthy and just need credit to get by. The bill gives regulators strengthened powers to break up financial companies that have grown too big and threaten to destabilize the financial system.

According to the bill, an independent Consumer Financial Protection Bureau housed inside the Federal Reserve will be established. Bank fees fund the agency, which would set rules to curb unfair practices in consumer loans and credit cards. It attempts to control complex financial products called derivatives that many blame for bringing down American International Group and Lehman Brothers. It supposedly limits the size and scope of banks’ investment activities, barring banks from trading on their own accounts, though it gives regulators the power to modify the ban. Banks are also prevented from trading derivatives, even for their clients’ accounts. Banks would be forced to spin off their swaps desks that make these trades. Now Congress is allowed to order a one-time Government Accountability Office review of Fed activities, including loans made during the financial crisis.

With this, the President gets new powers to appoint the head of the New York Fed. Currently, banking sector leaders play a big role in choosing who runs the New York Fed. Shareholders get to have a say in curbing executive pay packages, and makes it easier for investors to have a say in choosing who is on the ballot to run for the board of a publicly-traded company. It also adds that agencies that rate securities must disclose their methodologies. The Securities and Exchange Commission would appoint a panel to figure out how to independently match ratings agencies with firms that need securities rated. Now ‘liar loans’ get banned as lenders would have to document a borrower’s income before originating a mortgage and verify a borrower’s ability to repay the loan. The bill also forces ’skin in the game,’ by forcing firms that sell mortgage-backed securities to keep at least 5% of the credit risk, unless the underlying loans meet new standards that reduce risk.

DSNews.com – Survey: 59% of Borrowers Would Not Walk Away if Underwater

A survey released Thursday by Trulia.com and RealtyTrac shows that only 1 percent of homeowners with a mortgage say walking away would be their first choice if they were unable to make their payments. If their mortgage were to go underwater – meaning the property value drops below the amount still owed on the loan – 41 percent would at least consider a strategic default, while 59 percent would not consider walking away no matter how much their mortgage was underwater. Pete Flint, Trulia’s co-founder and CEO, says the new survey results show that,

“While it may not make the most sense to keep paying for this undervalued asset, many homeowners, at least for now, are holding on.”

He says only 5 percent of those surveyed say they would opt for a short sale as their first choice, while 69 percent would pursue a loan modification to save their home. The study conducted by the two California-based companies also found that while the stigma around owning a foreclosure has subsided, interest in purchasing a foreclosure is significantly down compared to a year ago. Currently, 45 percent of U.S. adults age 18 and above are at least somewhat likely to consider purchasing a foreclosed home in the future, compared to 55 percent this time last year, the survey results showed. “For every borrower who avoided foreclosure through HAMP last year, another 10 families lost their homes,” said Flint. “It now seems clear that government programs will not reach the overwhelming majority of homeowners in trouble,” leading to a larger number of foreclosed homes on the market, he explained. “We anticipate that there will be an increased number of both REO purchases and short sales throughout the rest of the year as the most active buying segments – first-time homebuyers and investors – continue to look for bargains,” said said Rick Sharga, SVP for RealtyTrac.

NAR Offers Congress Ideas to Strengthen a Successful VA Home Loan Program

The National Association of Realtors® offered some suggestions to Congress today toward making a good Veterans Affairs Home Loan Guaranty Program even better. Testifying before the House Subcommittee on Economic Opportunity, NAR First Vice President Moe Veissi, broker-owner of Veissi & Associates Inc., Miami, praised the VA program that encourages private lenders to offer favorable home loan terms to qualified veterans. “The program is most effective when it provides veterans who are unable to qualify for a conventional loan with favorable loan terms,” Veissi said. “VA’s strong, yet flexible, underwriting helps veterans purchase a home of their own without depleting their savings.”

To date, VA has guaranteed almost 19 million loans to American veterans, with a total value of more than $1 trillion in guaranteed loans. Eighty percent of veterans are homeowners, which is significantly higher than the national average at 67.2 percent. More than 90 percent of VA home loan borrowers have used the zero-downpayment option, Veissi said. “And their track record is fantastic – the default rate and delinquency rate for VA loans are far better than subprime, better than FHA, and even better than prime. Despite all the talk these days of ‘skin in the game,’ this program shows that solid underwriting is the key to sustainable homeownership,” Veissi said. He also noted that the VA has never guaranteed subprime loans. As a result of the subcommittee’s work and the passage of the Veterans’ Benefits Improvement Act of 2009, veterans have been able to refinance their distressed non-VA loans into safe, affordable VA loans.

NAR believes that VA should give borrowers the flexibility to negotiate fees as a normal part of home purchase transactions. Veissi pointed out that, while NAR supports VA efforts to limit fees paid by veterans, a high percentage of sales in his home state of Florida are foreclosures or short sales. “Since there is no seller to pay the fees, veterans are completely shut out of this market, which often includes the most affordable homes,” he said. To step up its efforts to educate Realtors® about the program’s value, NAR partnered last year with the VA to produce “Unlocking the Future,” a VA toolkit for Realtors® and homeowners that is comprehensive and informational.

Now on to our real estate investing education section …

Friday File: 15 Minute Resolution…Finding Killer Kindle Apps for Real Estate Agents & Investors

According to Amazon.com, Kindle remains the most wished for item on the website since the original release. For those that have been searching for a reason to purchase a Kindle but can’t justify the purchase as a business write-off…here’s a bit of a good news. These killer Kindle applications combined with the cost effective purchase of business books and syndicated news make the newest Kindle a “must have” gadget well within your price range.

Best Business Books on Kindle

Kindle makes ordering business books simple; one quick click and the newest release is instantly ordered and loaded…usually for $9.99 or less. Older books, public domain, classics and limited-time promotions are often free making the Kindle a great way to go green and save money at the same time. Currently the top three real estate investing books on Amazon include:

Investing in Real Estate by Gary W. Eldred

Rich Dad’s Advisors-: The ABC’s of Real Estate Investing: The Secrets of Finding Hidden Profits Most Investors Miss by Ken McElroy

The Complete Guide to Investing in Real Estate Tax Liens & Deeds: How to Earn High Rates of Return – Safely by Jamaine Burrell

Most Heavily Highlighted

Ever wonder what really makes an impact on people while they are reading? Searching for emerging trends to capture attention? Now you can find out with this great little tool. Simply click on the following link to find out what books are grabbing attention with the most highlighted passages:

http://kindle.amazon.com/popular_highlights/books

For those that are curious, this week’s most heavily highlighted books include:

Switch: How to Change Things When Change Is Hard by Chip Heath, Dan Heath

The 4-Hour Workweek, Expanded and Updated: Expanded and Updated,

With Over 100 New Pages of Cutting-Edge Content by Timothy Ferriss

Rather know the actual passages rather than the book? Visit

http://kindle.amazon.com/popular_highlights/highlights

This week’s passages include:

…the more money they made the next day on the streets. Those three things—autonomy, complexity, and a connection between effort and reward—are, most people agree, the three qualities that work has to have if it is to be satisfying. It is not how much money we make that ultimately makes us happy between nine and five. It’s whether our work fulfills us.

Outliers: The Story of Success by Malcolm Gladwell

No matter what the setting, there are five discrete stages that we go through as we deal with our work. We (1) collect things that command our attention; (2) process what they mean and what to do about them; and (3) organize the results, which we (4) review as options for what we choose to (5) do. This constitutes the management of the “horizontal” aspect of our lives—incorporating everything that has our attention at any time.

Getting Things Done by David Allen

See you at the top!

Chris McLaughlin
**************

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month
   * Long-time authority on real estate investing
      and rapid reselling of distressed homes. Owns
      portfolio of nearly 100 high-value, high-profit
    properties
    * Owner of one of Florida’s largest Real Estate firms,
     running 4 different offices, supporting over
     400 agents, uniquely positioning him to help
     thousands of investors make money in the
     biggest market opportunity ever!
   * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
      in Real Estate Investing, Entrepreneurship, and
      Wealth Building
  * Follow me on Twitter: http://twitter.com/mclaughlinchris
    * Join my Facebook Fan Page: http://www.mclaughlinchris.com
–

Smart Real Estate News & Commentary by Chris McLaughlin, May 17, 2010

admin — Mon, 17 May 2010 18:02:38 +0000

Forward this e-mail to your friends!

Then they can subscribe directly at the following link:

http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

**********************************************************

Every so often you come across the real deal. The guy

behind the scenes that makes famous people obscenely

wealthy…along with himself. And I’ve got just the

person for you this…he’s the real estate advisor to the

stars … and this is one webinar you gotta see! RSVP here:

Webinar: Donald Trump’s and Robert Kiyosaki’s Secret Weapon

When: Tuesday, May 18, at 3 PM ET, NOON PST

RSVP Link: https://www2.gotomeeting.com/register/519321851

**********************************************************

Housing market diagnosis: Bi-polar

Bi-polar is what comes to mind when diagnosing the post-homebuyer tax credit market. On one hand, sales and prices are rising, indicating recovery. On the other hand, so are interest rates and repossessions, which most certainly do not. And then there are the millions of foreclosures that need to be sold but haven’t yet been listed — so-called shadow inventory — that could derail a real recovery if they hit the market in floods. The result means, negative short-term but turning positive by the end of 2010. “In the short run, I see a mini-collapse,” said Richard DeKaser, an independent housing market analyst and founder of Woodley Park Research who correctly predicted a downturn back in 2005 when he was chief economist for National City Corp.

There are some strong negatives dragging on the market. 1. Intermittently increasing interest rates 2. Bank repossessions surpass a million homes in 2010. 3. More than a quarter of borrowers are “underwater,” meaning they owe more than their homes are worth. 4. “Strategic defaults” close to 31% of all foreclosures in March — where underwater home owners walkway even when they can still afford to pay. And the scary truth: Right now, there could be more than 4.5 million homes that are ready to be sold but not on the market, also called “shadow inventory,” according to a recent report by Barclays Capital. This so-called shadow inventory is a recent phenomenon. In the past, inventory was either tight or it wasn’t. But now, with home prices so low and so many foreclosures on the market, both homeowners and banks have been waiting to put properties on the market. But as more sellers put their homes up for sale, supplies increase, which will depress prices again. Rinse and repeat ad infinitum. That vicious cycle could cause prices to bounce up and down for years, low or no appreciation and more homeowners in negative equity.

Obama aide: U.S. economy still needs further boost

The U.S. economy has begun to climb out of the worst downturn since the 1930 Great Depression but still needs additional steps by the federal government to stem a crisis in the job market, a senior economic adviser to President Barack Obama said on Sunday. “What we need now is not the withdrawal of support, but further targeted actions that will help the private sector come back more strongly,” Christina Romer, chairwoman of the White House Council of Economic Advisers, said in prepared remarks for a commencement ceremony at the College of William and Mary in Williamsburg, Virginia.

Romer urged Congress to pass a series of measures Obama has proposed to jump-start growth, including the establishment of a lending fund to spur credit to small businesses and providing cash-strapped cities and states with aid to help them avoid layoffs of teachers and other local employees. With the U.S. unemployment rate just under 10 percent, the Obama administration is juggling the need to spur economic growth with pressure to rein in ballooning U.S. budget deficits. The latest government report on the job market showed that the jobless rate ticked up two tenths of a percentage point to 9.9 percent as discouraged workers began looking for work again. Romer, an expert on the Great Depression, used much of her speech to compare the current economic crisis to the long downturn of the 1930s. Republicans have sharply criticized the stimulus package, calling it an example of overreach by the government and contending that it failed to do enough to spur jobs growth.

Diana Olick – Home Mortgage Interest Deduction In Play

“The Administration isn’t officially considering it, maybe not “actively” considering it, not even taking a side on it per se. According to “staff” it was just a “musing.” At a small conclave of reporters, no cameras allowed, the Secretary of Housing and Urban Development was reportedly asked about the mortgage interest deduction, the importance of home ownership and the seeming shift of focus from owning to renting. That last bit is huge in itself, as pretty much every President dating back to Herbert Hoover and the Home-Loan Discount Banks pushed people to own own own. Some argue that it was this push to the “ownership society” by President’s Clinton and Bush that caused at least some of the housing crisis, and at the very least pushed Fannie Mae and Freddie Mac to push the envelope of responsible lending. Secretary Donovan reportedly offered that modifying the deduction could result in deficit reduction and, as the Wall Street Journal notes, “rebalancing federal housing policy.”

The mortgage interest deduction, which appears on about 41 million U.S. tax returns, is a huge political hot button, and the more questions the Secretary got, the quicker he tried to get out of the conversation. No, there is “no official position” on the deduction. But the question didn’t come from the ether. A couple of economists from Harvard and Wharton suggested last week that the housing bubble was not caused entirely by faulty mortgage lending, but perhaps more by housing policy going back decades. Their conclusion was to focus on modifying the mortgage deduction. According to the Congressional Joint Committee on Taxation, between 2009 and 2013, the federal government will lose roughly $600 billion from the home mortgage interest deduction.”

Threat of Shadow Inventory Diminishing: Barclays

Analysts at Barclays Capital say the industry’s ominous shadow inventory is close to topping out. New research published by the firm says the supply of homes nearing REO status, defined as 90 or more days delinquent or in the process of foreclosure, will peak this summer and then begin falling gradually as the market becomes stable enough to absorb 130,000 distressed properties a month. “While we expect REO levels to remain elevated, the trickle of homes from foreclosure into REO implies moderate levels of inventory reaching market,” Barclays said in its report.

The company estimates the current REO supply to be 478,000 and expects it to rise to 536,000 by late 2011. Barclays’ delinquency pipeline snapshot shows that as of February, there were 2.4 million mortgages at least 90 days past due and 2.1 million more already winding through the foreclosure process, which combined makes up a shadow inventory of 4.5 million. It’s a daunting tally and could grow larger as foreclosure alternatives are exhausted, but Barclays’ model forecasts 4.7 million distressed sales over the next three years, with 1.6 million coming in 2010, 1.6 million in 2011, and 1.5 million in 2012. The research firm notes, however, that an orderly liquidation of shadow inventory will require both “more robust household formation and job growth.” Barclays forecast that the industry is only a few months away from reaching peak levels of shadow inventory.

Commercial Market Still Struggling

While the commercial real estate market may not have fully recovered, National Association of Realtors® Chief Economist Lawrence Yun identified some developing, positive trends in the market that could eventually lead to recovery at the “Economics Issues and Commercial Business Trends Forum.” Yun said jobs only began increasing a couple of months ago and are still below peak. The commercial market has seen a few improving trends in recent months. The market is experiencing an increase in transactions due to more distressed properties available, and prices are beginning to stabilize. Yun believes within the next year more lending will slowly become accessible to commercial property owners.

Two commercial sectors showing the most promise are manufacturing and multifamily. Manufacturing activity and employment have risen recently and because household formation is also rising, the multifamily sector will likely fare the best during this economy. Despite some of these promising trends, the commercial market is still experiencing high vacancy rates and rent concessions. “All real estate is local, but I expect to see vacancy rates bottoming out and rent rising by next year,” said Yun. He also warned against some of the possible risks commercial practitioners may experience in the future such as high interest rates and inflation, as well as increased taxes for commercial real estate investors. During the session, Yun was joined by two leading economic experts, Diane Swonk, Mesirow Financial; and Brendan Reilly, Commercial Mortgage Securities Association. The panelists agreed that an improving economy and job creation continue to be the two main factors when it comes to restoring the commercial real estate market.

************************************************************

Now on to our real estate investing education section …

Huh? HUD Reform Could Create Chaos

It probably comes as no surprise that the lending industry has…and will continue…to undergo dramatic changes in response to the financial strain and economic meltdown however, one recent proposal is putting a lot of lenders up in arms. Specifically the “Strengthening Risk Management through Responsible FHA Approved Lenders” report published on April 20,2010 which essentially lays out the new plans designed to help FHA lenders and brokers comply with upcoming regulatory changes.

While that all sounds straightforward enough, the devil is in the details. According to industry experts, after December 31,2010, the FHA broker approval process will be eliminated from HUD responsibility and oversight. Savvy brokers might wonder who will now be in charge of the approximately 8,000 current FHA brokers that will be left without direct supervision under HUD. According to the same report, beginning in 2011, FHA approved lenders will be responsible for approving brokers…and held accountable for the brokers FHA originations.

Hmmm…let’s take a moment to break this down into plain language terms.

By eliminating roughly 8,000 brokers from HUD’s direct responsibility without reducing HUD’s audit staff, the remaining 3,000 FHA lenders are likely to be exposed to greater scrutiny and oversight. If that wasn’t enough, here are few more highlights coming soon to an office near you.

May 20,2010 – Yes, this week marks the first step in the reform process. Beginning 05/20/10, lenders will be directly responsible for the approval and oversight of new brokers (12/31/10 for current FHA approved brokers). There does seem to be a decided lack of clarity. Confused yet?

You aren’t alone. To date, HUD has not provided lenders any specific guidance on how to oversee a brokers activity.

December 31,2010 – This is the final date where Quality Control audits will be required for broker approval. After that date, the broker will require FHA lender approval to participate. Lenders are expected to pass the QC requirements to the broker in an effort to reduce regulatory requirements.

To learn more or to view the document for yourself visit:

http://edocket.access.gpo.gov/2010/pdf/2010-8837.pdf

See you at the top!

Chris McLaughlin
**************

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

Smart Real Estate News & Commentary by Chris McLaughlin, May 14, 2010

admin — Fri, 14 May 2010 18:46:14 +0000

Forward this e-mail to your friends!

Then they can subscribe directly at the following link: http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

**********************************************************

Short Sale Sherlock this Saturday 3:00 PM ET, NOON PST:

Make sure you don’t miss out by going here now:

https://www2.gotomeeting.com/register/568565419

It’s the hottest, most explosive way to generate

cash in a hurry in your real estate – biz. Or,

if you want to make that short-sale happen in maybe

half the time…

You need to know this info. Join us tomorrow at 3 PM, NOON PST:

https://www2.gotomeeting.com/register/568565419

************************************************************

Freddie and Fannie won’t pay down your mortgage

The two largest owners of mortgages will not lower the principal on the loans they back – that’s a clear message for all those troubled homeowners. Fannie Mae and Freddie Mac, which are controlled by the federal government, will not lower the principal on the loans they back, instead opting for interest rate reductions and term extensions when modifying loans. But their stance is out of synch with the Obama administration, which is seeking to expand the use of principal writedowns. In late March, it announced servicers will be required to consider lowering balances in loan modifications. Asked whether they will implement balance reductions, the companies and their regulator declined to comment.

The Treasury Department also declined to comment. What’s holding them back is the companies’ mandate to conserve their assets and limit their need for taxpayer-funded cash infusions, experts said. If Fannie and Freddie lower homeowners’ loan balances, they are locking in losses because they have to write down the value of those mortgages. Essentially, that means using tax dollars to pay people’s mortgages. Between them, they have received $127 billion — and recently requested another $19 billion — from the Treasury Department since they were placed into conservatorship in September 2008, at the height of the financial crisis. Treasury and the companies have already set aside $75 billion for foreclosure prevention, which can be spent on interest-rate reductions or principal write downs. Meanwhile, a growing number of loans backed by Fannie and Freddie are falling into default.

Shakeup for Credit Raters

Credit rating agencies such as Moody’s, Standard & Poor’s and Fitch Ratings would face big changes under separate measures adopted by the Senate. Under an amendment offered by Democratic Senator Al Franken, the government would set up a clearinghouse to match rating agencies on a semi-random basis with debt issuers. That could ease pressures the agencies face to assign rosy ratings to debt instruments issued by the firms that hire them, backers said. Franken’s amendment also would encourage greater competition from smaller ratings agencies. Another amendment offered by Republican Senator George LeMieux would require federal regulators to develop their own standards of credit-worthiness rather than rely solely on assessments from rating agencies. Both amendments could open the troubled credit-rating business to more competition, but it was not clear they would make ratings more accurate or timely, analysts said.

Shares of Moody’s closed down 2.6 percent after the votes, and Standard & Poor’s parent McGraw-Hill Cos fell 2.4 percent on broadly lower trading across the New York Stock Exchange. A Standard & Poor’s spokesman said the Franken amendment could lead to more homogenized rating opinions and cause investors to believe they were endorsed by the government. Franken’s amendment was approved in a 64 to 35 vote. LeMieux’s amendment passed by a 61 to 38 vote. Finally, large financial firms would have to set aside more capital to boost their stability during times of crisis under an amendment unanimously adopted by voice vote. It would direct regulators to increase capital requirements as firms grow in size or engage in riskier lending practices. The measure, sponsored by Republican Senator Susan Collins, aims to make sure that highly leveraged financial giants do not again threaten financial stability, as they did in the crisis.

Diana Olick – Banks Ignore Delinquent Borrowers

“Some encouraging signs on the foreclosure front may not be as rosy as some are reporting. RealtyTrac, the online foreclosure sale site, shows a 9 percent dip in the number of properties with foreclosure filings in April, month-to-month. The driver of that dip is a big drop in new notices of default. The final stage of foreclosure is bank repossessions (REO) shot up to a new record high, up 45 percent from a year ago. When I first read the report I thought, okay, we knew there was a big pipeline of loans that would not get modified and would have to come out the end at some point; now is that point. The fact that fewer loans are going into the pipeline should be our focus, and that’s a positive. That’s what I thought until I interviewed RealtyTrac’s Rick Sharga. “People are sitting in their houses not paying their mortgages, and the banks are letting those delinquencies extend longer and longer periods of time before they put them in foreclosure,” Sharga told me. That, he adds, is the main reason we’re seeing lower numbers of new defaults. The borrowers are in default, but the banks aren’t paying attention, so they don’t show up in the numbers.

“The fact that we have six to six and a half million loans that are either seriously delinquent or in foreclosure also suggests we are not nearly out of the woods. If we just started to absorb that inventory at the pace we’re currently seeing new foreclosure proceedings we have about a 50 to 55 month supply of loans that yet have yet to be processed, so we have a way to go before we are out of the mess,” he added. Sharga makes a compelling point. A lot of folks are either falling out of the trial modification period or not qualifying in the first place, and those loans are moving quickly to bank repossession. California-based mortgage analyst Mark Hanson adds perspective with a look at “cancelled foreclosures.” These are not tracked by RealtyTrac, but they “bite right out of Notices of Default and foreclosures, so to get a real idea of how ‘credit’ is doing, you have to add a certain percentage back.” That’s because Hanson believes the redefault rate on these modifications will be at the very least 50 percent 6-19 months out. “

Retailers poised for victory in debit card fee fight

Retailers are poised for a major victory in the Wall Street reform bill currently pending in Congress. The Senate adopted an amendment late Thursday that will slap sharp restrictions on the fees issuers levy every time a buyer pays with a debit card. Called “interchange” fees, the charges typically consume 1% to 3% of every transaction run through a debit or credit card. Network operators like Visa skim off a fraction of the fee, while the rest goes to the financial institution that issued the card. The new Senate amendment adds two major restrictions to the rules on interchange fees. First, it requires that the fee be “reasonable and proportional to the actual cost incurred” by the payment network or issuer for processing the transaction. The Federal Reserve will have leeway to determine what counts as a “reasonable” fee, but it’s likely to be a lot lower than the current rates. Second, it allows sellers to offer a discount to customers who pay with cards that carry lower transaction fees.

That’s a change merchants have sought for years. They’re currently contractually obligated to accept all cards on the same terms. If American Express — which has some of the industry’s highest interchange rates — costs a merchant to accept than a Visa card does, the merchant can’t offer buyers a discount for using Visa. The amendment is now part of the broader financial reform bill the Senate hopes to finalize next week. That the proposal has made it this far is a major victory for retailers, especially small ones, who have fought for years for regulatory curbs on what they view as the monopolistic practices of Visa, MasterCard (MA, Fortune 500) and other payment network operators. Durbin’s amendment isn’t a compete fix. Its most prominent limitation is that it only applies to debit cards. Credit cards, like those issued by American Express and Discover, are exempt from the fee caps. The amendment also excludes cards issued by community banks and credit unions with less than $10 billion in assets — those can continue to carry the same interchange rates they currently do. But in practice, that exemption will have little impact. The vast majority of all credit and debit transactions go through major issuers like Bank of America and JPMorgan Chase, and analysts suspect Visa and MasterCard will simply choose to levy the lower interchange rates across the board, on all debit purchases.

MBA Hails Risk Retention Fixes to Regulatory Reform Bill

Robert E. Story, Jr., CMB, Chairman of the Mortgage Bankers Association (MBA) issued a statement on 13/05/10, reacting to passage in the Senate of the Landrieu/Isakson and Crapo Amendments to S. 3217, the Restoring American Financial Stability Act of 2010. The Landrieu/Isakson Amendment requires regulators to establish a category of well‐underwritten single family loans that would be exempt from the bill’s risk retention requirements. The Crapo Amendment directs regulators to consider risk retention forms and requirements in order to ensure that regulators consider the unique nature of the Commercial Mortgage Backed Securities (CMBS) market.

“Mortgage originators already have significant ‘skin in the game’ in the form of representations and warranties that they make to their investors. Mandating additional one-size-fits-all risk retention would have only further destabilized the already fragile real estate markets. We applaud passage of the Crapo Amendment which appropriately recognizes the unique nature of the CMBS market, provides flexibility with regard to the various forms of retained risk, furthers the goal of aligning interests across transactional parties and is a significant step toward restoring the CMBS markets, ” said Robert E.Story Jr.

FICO Loses Battle in Credit Scores War

The use of credit scoring is vital to the mortgage underwriting process. However, behind the scenes, a war is raging over who can lay claim to that process, with one party recently losing ground in the courtroom. The Fair Isaac Corp. was denied a new trial regarding what it claims is clearly its trademark; that is, the act of rating an individual’s credit on a scale of 300 to 850. However, VantageScore Solutions, the credit rating provider created by America’s three major credit reporting companies — Equifax, Experian and TransUnion — successfully argued that its system that rates credit on a scale between 501 to 990, is not in violation of the FICO trademark. The presiding US district judge in Minnesota, Ann Montgomery, went a step further and called for FICO’s trademark to be invalidated in her verdict. In her decision, Montgomery addressed the jury’s finding stating that one cannot to by Fair Isaac’s central theory of the case — i.e., “that one can legitimately claim trademark protection in the numerical range for credit scores.”

VantageScore Solutions CEO Barrett Burns said that the court’s decision confirms its longstanding allegation that FICO’s claims are “meritless,” and “at every step, VantageScore has prevailed against Fair Isaac’s claims.” And FICO has the full intention of appealing, according to Craig Watts, a director of public affairs at Fair Issac. As to be expected, he said that FICO strongly disagrees with Montgomery’s verdict. Watts added that the basic tenants of the case surround fairness and consumer protection, not against the numerical methodology for presenting that value.

Now on to our real estate investing education section …

Friday File – Social Media & Short Sales Success

This week we have focused on mental modes ranging from procrastination to the adoption of social media marketing. New trends and attitudes alike both require a change in mindset as well as the adoption of new skills. Fortunately a bit of information is often more than enough to convince most people of the value to be derived from each. For this week’s 15 minute resolution, take time to check out these super convenient tools designed to measure your social media success and stay up to date on the rapidly changing world of virtual marketing trends.

Source- http://addthis.com/services/all

Find out which social sharing and networking sites are currently most popular then monitor which are trending up or down. For example, MySpace has been showing a decidedly sluggish pattern so switch your efforts to Facebook instead.

Source- http://www.twellow.com

A third party search directory that monitors and discovers the latest and greatest trends and opportunities related to any topic or industry by performing an online search directory of Twitter.

Source- http://backtweets.com/

A third party Tweet tracking source that measures viral results! Determine the number of Re-Tweets any URL has received in order to track the popularity and effectiveness of a given message or topic. Find out how many times they have been viewed and who is Re-Tweeting what information. Follow-up with individualized attention for those “big fish” targets.

Source- http://www.tweetdeck.com

Manage multiple Twitter accounts and other social media platforms from one location. Not only does it save time and effort but it increases efficiency. Better yet, outsource it to someone and have them generate a summary report for your review!

See you at the top!

Chris McLaughlin
**************

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month
   * Long-time authority on real estate investing
      and rapid reselling of distressed homes. Owns
      portfolio of nearly 100 high-value, high-profit
    properties
    * Owner of one of Florida’s largest Real Estate firms,
     running 4 different offices, supporting over
     400 agents, uniquely positioning him to help
     thousands of investors make money in the
     biggest market opportunity ever!
   * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
      in Real Estate Investing, Entrepreneurship, and
      Wealth Building
  * Follow me on Twitter: http://twitter.com/mclaughlinchris
    * Join my Facebook Fan Page: http://www.mclaughlinchris.com
–

Short Sales Riches Blog » fannie mae

New home sales will be up?

Smart Real Estate News & Commentary by Chris McLaughlin July 26, 2010

Come learn from Nathan J.’s mentor who will do all your deals for you…

********************************************************** New home sales will be up?

More magic numbers from the WH

Freddie’s mortgage and issuance $179bn in H110

Soak the rich

DSNews.com – GSEs next?

Now for our real estate education section…

Bills, Bills, Bills – How Reform is Changing the Face of Real Estate

HUD wants a FICO of 500

Smart Real Estate News & Commentary by Chris McLaughlin July 19, 2010

********************************************************** HUD wants a FICO of 500

Hiring up slightly

Asking prices up slightly

Antidote to an anti-business agenda?

BoA encourages short sales

Now for our real estate education section…

The 15 Minute Resolution…How to Generate Free Leads with Craigslist

Smart Real Estate News & Commentary by Chris McLaughlin July 1, 2010

IT’s BACK: NO FLIP RICHES REOPENS THIS SATURDAY!

********************************************************** US Congress Backs Home Tax Credit Extension

Wall Street reform Bill Approved – Pitfalls galore

Fannie Mae Mortgage Portfolio to Fund More ‘Dead Assets’

Commercial/Multifamily Real Estate show signs of stability, in First Quarter 2010

The Housing Market, still lost in the Woods

Now for our real estate education section…

Facts, Figures & Other Tidbits That Make a Real Difference

Smart Real Estate News & Commentary by Chris McLaughlin June 30, 2010

********************************************************** Freddie Mac Short Sales Up 600% from 2 Years Ago

Foreclosures sell at 30% discount

Wall Street reform bill reformed

Mortgage Refinance Applications Increase as Rates Continue to Drop in Latest MBA Weekly

Diana Olick – Is Home Ownership an American Right?

Now for our real estate education section…

Facts, Figures & Other Tidbits That Make a Real Difference

Smart Real Estate News & Commentary by Chris McLaughlin June 25, 2010

Fudging Homebuyer Tax Credit

U.S. Lawmakers arrive at New Finance Rules

Oversight Council made up of federal financial regulators.

Fannie Mae gets tough on homeowners who walk away

Diana Olick – Fannie Mae: Walk Away and You Will Pay

Nearly 1 Million lose jobless benefits

DSNews.com – 70% of Modifications in May Were Non-HAMP: Report

Now for our real estate education section…

Friday File – 15 Minute Resolution

Smart Real Estate News & Commentary by Chris McLaughlin June 18, 2010

Tax Lien Certificates: The Guaranteed Solution for Financial Freedom

Join us tomorrow (Saturday) at 3:00 PM ET, NOON PST:

**************************************************** CNBC’s Diana Olick – Oil and Real Estate: Fannie Mae to the Rescue

Suggestions from MBA to the Administration on the Future of the Housing Finance System

Tax, Jobs Bill Blocked in U.S. Senate

Consumer Price Drop Squeezes Profits

Mortgage Fraud Task Force Arrests 485 in Sweeping Crackdown

DSNews.com – House Republicans Want Penalties for Strategic Defaulters

Now on to our real estate education section…

Friday File – 15 Minute Resolution: Simplify Your Life

Get Control of Your Entire Social Network

Smart Real Estate News & Commentary by Chris McLaughlin June 2, 2010

Special 100% Content LIVE Webinar TODAY at 2 PM ET, 11 AM PST:

ENCORE: Find Private Lenders NOW

US Home-Buying Loan Demand Falls for 4th Week

Mortgage Refinance Applications Go Up, Purchase Applications Go Down

Goldman Sachs Spies A Way Out Of Fraud Claims

DsNews.com – GSEs to Begin Accepting HAFA Short Sales

Half of Americans Can’t Afford Large Down Payments on Mortgages

Now on to our real estate education section…

Crisis Economics

Smart Real Estate News & Commentary by Chris McLaughlin, May 21, 2010

FIX A FLIP OPENS SATURDAY AT 3 PM ET, NOON PST!

Mortgage Rates Hit New Lows in Two Weekly Surveys

Senate Passes Finance Bill

Diana Olick – US Housing Prices to Rise Slightly in 2010: Poll

What’s in the Wall Street Bill

DSNews.com – Survey: 59% of Borrowers Would Not Walk Away if Underwater

NAR Offers Congress Ideas to Strengthen a Successful VA Home Loan Program

Now on to our real estate investing education section …

Friday File: 15 Minute Resolution…Finding Killer Kindle Apps for Real Estate Agents & Investors

Best Business Books on Kindle

**********************************************************
New home sales will be up?

**********************************************************
HUD wants a FICO of 500

**********************************************************
US Congress Backs Home Tax Credit Extension

**********************************************************
Freddie Mac Short Sales Up 600% from 2 Years Ago

****************************************************
CNBC’s Diana Olick – Oil and Real Estate: Fannie Mae to the Rescue