Foreclosure

The Arizona Department of Housing (ADOH), one of five state housing finance agencies slated to receive federal funding through the administration's Hardest Hit Fund, has submitted a proposal to the U.S. Treasury Department detailing how it plans to use this financial aid. According to the proposal, the funding has the potential to assist approximately 4,000 households across Arizona and will be used for permanent mortgage modifications, second mortgage settlement, temporary mortgage assistance, and homeowner advocacy through HUD counselors.

Freddie Mac reported Wednesday that it had sold 207 HomeSteps REO homes to first-time buyers and other owner-occupants at auctions in Las Vegas and Riverside-San Bernardino, California on April 24 and 25. The auctions, managed by New Vista and Real Estate Disposition Corporation (REDC), drew thousands of bidders. Freddie Mac sold 90 percent of the REO properties set aside for the auctions. Altogether HomeSteps found buyers for 107 repossessed homes in Las Vegas and 100 homes in Riverside/San Bernardino.

Chase announced Tuesday that it is opening a homeownership center in the Stockbridge area of Atlanta this week. The center, which is the second in Georgia, will offer one-on-one help to families struggling with their mortgage payments. With the opening of this new location, Chase now has 51 homeownership centers in 14 states and Washington, D.C. Borrowers struggling with Chase, Washington Mutual, or EMC Mortgage-serviced loans can schedule appointments at these centers or simply walk in six days a week to receive assistance from trained advisors.

Treasury announced plans in March to allow principal reductions for distressed borrowers who owe more on their mortgage than the home is worth. The move has sparked a debate over the ramifications of mortgage debt forgiveness. The credit ratings agency DBRS says even investor reaction to the push for debt forgiveness has been mixed. But the firm says if done properly, principal write-downs will benefit securities investors in the long-run, and could moderate the ever-increasing delinquency pipeline and shrink swollen housing supplies.

Hudson & Marshall of Texas, Inc, (H&M) announced Tuesday that it is planning to auction off more than 230 Kansas City Homes in a two-day receiver's auction to be held on May 14 and May 15. The properties to be included in the auction are valued from $2,000 to $94,000 and come with an insurable title and no back taxes or liens. And in an effort to quickly sell these homes, most will be sold absolute - no minimum and no reserve bids - to the highest bidder regardless of price.

Incidents of mortgage fraud and misrepresentation by professionals in the industry continue to climb. According to a report released Monday by the Mortgage Asset Research Institute (MARI), such cases increased 7 percent for the 2009 fiscal year when compared to the previous 12 months. The pace has slowed thanks to improvements in industry reporting and policing, but MARI's research shows foreclosure rescue and loan mod scams are on the rise, and now the company is seeing a significant increase in short sale scams.

With defaults continuing to mount and declining property values still widespread, the industry is seeing an increase in short sales. Such transactions are expected to burgeon even further now that the federal government has implemented its Home Affordable Foreclosure Alternatives (HAFA) program. With the new policies and still-precarious market conditions, short sales are gaining in popularity among lenders and distressed homeowners alike, but as with any modus operandi that rapidly picks up steam, this proliferation can open the gate for fraudulent activity.

The Loan Modification Scam Prevention Network, led by Fannie Mae, Freddie Mac, the Lawyers' Committee for Civil Right Under Law, and NeighborWorks America, is launching a national campaign to prevent loan modification scams through public education, complaint reporting, and coordination with local, state, and federal enforcement agencies.

Foreclosure activity in Massachusetts increased significantly during the month of March. The number of foreclosures initiated by lenders in the Bay State jumped 22 percent from the prior month and 8 percent from a year earlier, according to the latest report from the Warren Group, a Boston-based real estate research firm. Foreclosure deeds and auction announcements also surged.

The North Carolina Office of the Commissioner of Banks (NCCOB) says new mortgage rules aimed at reducing unnecessary foreclosures in North Carolina have been approved by the Rules Review Commission and will take effect for licensed mortgage servicers on June 1, 2010. Under these new rules, mortgage servicers will be required to stop foreclosure efforts pending the consideration of a request by the homeowner for assistance, and they will be required to respond promptly and clearly to homeowner requests for assistance.