Foreclosure

The Texas housing market may be on the road to recovery. According to the latest Texas Quarterly Housing Report released Monday by the Texas Association of Realtors, both sales and prices for homes in the Lone Star State increased on a year-over-year basis in the first quarter of this year. Sales volume for existing single-family homes was 42,682 for the first three months of 2010, up 4 percent from the same period in 2009. In addition, the median home price jumped 3.13 percent from $137,200 in the first quarter of last year to $141,500 in the first quarter of this year.

Colorado lawmakers are hoping to mitigate the effects widespread foreclosures are having on local communities in the state. This week, Gov. Bill Ritter signed into law a bill that he says will secure neighborhoods against abandoned properties that have fallen into foreclosure by cutting in half the minimum time frame for a foreclosure sale, as mandated by the state.

Only 10 percent of the $41 billion of distressed commercial real estate from a year ago has been resolved and is no longer held by the lender, according to new data from the research firm Real Capital Analytics. The company's analysis shows that securities trusts and domestic lenders have settled a comparably small portion of their distress from last year. Of those loans resolved, commercial mortgage-backed securities holders are more likely to have restructured the mortgages, while domestic banks are more likely to have foreclosed.

Treasury Secretary Timothy Geithner says servicers are failing in their efforts to modify loans. Geithner told a Senate subcommittee that his office has received ""countless frustrated phone calls"" from borrowers, and is troubled by reports that servicers have foreclosed on eligible homeowners and repeatedly claim to have lost documentation. Geithner says Treasury is already conducting compliance reviews targeted at certain servicers and may withhold incentive payments.

In a proposal submitted to the Treasury Department, the California Housing Finance Agency (CalHFA) detailed how it plans to use $699.1 million in federal aid made available through the administration's Hardest Hit Fund. According to the proposal, CalHFA will use the funds to implement four distinct programs, three designed to help California homeowners remain in their homes and one intended to help underwater homeowners transition out of their homes into more affordable housing.

Two House Democrats have introduced a bill to create a ""right to rent"" for homeowners facing foreclosure. The bill would allow a family receiving a foreclosure notice to petition a judge to stay in their home as renters under a 5-year lease. The judge would appoint an independent appraiser to set fair market rental value, which would be allowed to rise with inflation.

""Mixed results"" has been the predominant theme among industry studies the last couple of weeks. The latest report from Lender Processing Services held true to form. The Florida-based company's analysis of the nation's home loan market indicates ""modest improvements"" in the number of nonperforming loans returning to current status and fewer new delinquencies. But the research firm says these steps forward are still overshadowed by a large pool of 7.39 million non-current and REO loans.

On Thursday, the National Community Reinvestment Coalition (NCRC) released findings of a new study indicating that subprime lending and subsequent resulting foreclosures contained a clear racial component not explained by objective underwriting criteria. According to the study, African American and Latino borrowers were more likely to receive a subprime loan and go into foreclosure than similarly situated white homeowners, controlling for credit risk and other borrower, neighborhood, and loan characteristics.

Data released by RealtyTrac Thursday shows that cities in the typical foreclosure hot spots of California, Florida, Nevada, and Arizona once again accounted for the nation's 20 highest foreclosure rates in Q1. But it's their long track record of debilitating foreclosure numbers that have locked them into those rankings. RealtyTrac says many of the hardest-hit cities are actually posting significant declines from a year ago. Instead, foreclosure activity now is running rampant in cities outside the Sun Belt.

Due to the high levels of home price declines and unemployment in the Sunshine State, Florida Housing Finance Corporation was selected as one of five state agencies to receive federal funding from the administration's Hardest Hit Fund. Of the initial $1.5 billion allocated for these markets, Florida Housing is slated to get $418 million. Pending approval of its proposal, the state plans to use the money to pay up to nine months of mortgage payments for unemployed homeowners and cover legal fees for some borrowers to fight foreclosure.