News

The analysts at Capital Economics are holding fast to their forecast that the downturn in the housing market is drawing to a close. As a result, they say housing should soon start to boost economic growth, but as it now makes up only a small share of the economy, the sector is unlikely to add much more than 0.2 percentage points to annual gross domestic product (GDP) growth this year. In the fourth quarter of 2011, residential investment accounted for just 2.5 percent of overall GDP. That's down from the 2005 peak of 6.3 percent and the 1946 to 2008 average of 4.8 percent.

Field Asset Services (FAS), a provider of pre-foreclosure, REO, and renovation field services, has released its top 10 property preservation predictions for 2012, which focus on providing superior customer service, the need to take initiative to pre-empt future problems, and a demand for knowledge that will open communication and deliver results. Among the company's forecasts, institutional investors will begin to emerge as their interest in purchasing single-family residence REO properties increases, and innovation in the area of mobile technology will be necessary for vendors and contractors to work more efficiently from the field.

Seventy-two percent of homeowners say they are satisfied with homeownership, according to a recent HomeGain survey of more than 1,400 homeowners. Among the 28 percent who said they were dissatisfied, nearly two-thirds cited price depreciation as the main reason for their dissatisfaction. HomeGain also assessed satisfaction levels by sales type and found that homeowners who purchased a home through a short sale were the most likely to be pleased with their choice, followed by those who purchased a foreclosed home.

The number of foreclosure actions initiated in 2011 was down 38.7 percent compared to 2010, according to a new report from Lender Processing Services (LPS). The foreclosure inventory, on the other hand, remains near historic highs, at 4.11 percent. The numbers illustrate the impact of processing delays brought on by the robo-signing controversy, the impact of which remains strong in judicial states. LPS says half of all loans in foreclosure in judicial states have not made a payment in more than two years compared to 28 percent in non-judicial states.

The special mortgage investigation unit announced by President Obama during his State of the Union address Tuesday night has taken shape. The new Residential Mortgage-Backed Securities (RMBS) Working Group will operate within the Financial Fraud Enforcement Task Force and will consists of at least 55 Department of Justice attorneys and investigators, as well as state attorneys general. The president has tasked the group with uncovering those responsible for pooling and selling mortgage bonds that contributed to the financial crisis.

The default servicing industry is in a state of transition, according to Larry B. Litton Jr., CEO of Selene Finance, and it's the smaller, more nimble servicing operations that will have the advantage in reacting quickly to the new rules and the changes that are in store. Litton says many of the bigger servicing shops are still set up to do what he considers commoditized types of processes and aren't able to adapt quickly to the regulatory changes coming down the line, while smaller special servicers are already built for single point of contact and to be highly responsive to consumers.

Changes announced Friday to the Home Affordable Modification Program (HAMP) are expected to extend relief to a larger share of struggling homeowners as well as renters. One of the key adjustments centers around principal reductions. To encourage investors to agree to the principal reducing modification currently available through HAMP, Treasury is tripling incentives for such restructurings, paying from 18 to 63 cents on the dollar, and extending this same incentive to Fannie Mae and Freddie Mac, who have previously opted not to participate in HAMP's principal writedown option.

With vacant and deteriorating properties taking a toll on communities throughout Ohio and Michigan, 16 congressmen from the two states are proposing large-scale demolition as a means of easing the burden of these problematic properties, and they've petitioned President Obama for federal funding. They say some homes in Ohio are selling for 8 percent of their appraised value as a result of neighboring vacancies, and they cite a demolition project in Flint, Michigan, that preserved $109 million in property values among the remaining inhabited homes.

Default technology provider Equator has promoted Chris Michaels to VP of product development and Robert McKinley to VP of business development. Michaels has nine years of business analysis and product development experience. He will lead the team that provides business process solutions and system design for all Equator's clients. McKinley has led Equator's business development effort while working closely with new and existing customers. In his new role, he will continue to foster new business relationships.

Freddie Mac reported Thursday that mortgage interest rates have done a 180 and are now starting to climb, buoyed by positive housing data over recent weeks which show the market ended 2011 on a high note. The 30-year fixed-rate mortgage rose 10 basis points in one week's time and is now averaging 3.98 percent, reversing its previous three-week trend of setting all-time record lows. Despite the jump, this marks the eighth consecutive week the 30-year fixed rate has remained below 4.00 percent.