News

Foreclosures and short sales made up 30 percent of all existing-home sales in June, according to the National Association of Realtors. Overall sales volume slipped in June along with the share of distressed properties. Total existing-home sales declined 0.8 percent to an annual rate of 4.77 million, the trade group's lowest reading since last November. Without a strong rebound in the months ahead, 2011 is on pace to be the fourth time in the last five years where home sales have declined on an annual basis.

Wells Fargo says its second quarter expenses included $428 million of operating losses, substantially all driven by litigation accruals for mortgage foreclosure-related matters. Loan losses, though, were down substantially, supporting a 29 percent increase in net income to $3.9 billion for the three-month period. The company says credit quality continued to improve, marking its sixth consecutive quarter of declining loan losses and third consecutive quarter with fewer nonperforming assets.

Visionary Apps LLC announced Tuesday that its Complete Foreclosures app will now be powered by RealtyTrac data. The app, which previously included about 25 data fields, will now include up to 75 data fields with RealtyTrac data for more than 1.5 million default, bank-owned, and pre-foreclosure listings in more than 2,200 counties across the country. The free Complete Foreclosures app is customizable based on price, square footage, and numbers of bedrooms and bathrooms so that users can eliminate listings that are not relevant to them.

Pro Teck Valuation Services and American Mortgage Consultants (AMC) are teaming up to deliver real estate valuation review and reconciliation services through AMC's due diligence platform. Valuations are an important part of due diligence, loss mitigation, and buy-backs and put-backs. In order for companies to make sound investment risk management decisions, they need to understand all variables pertaining to valuation. AMC and Pro Teck announced their solution to the mortgage industry's due-diligence needs Tuesday.

A new California law bars junior lien holders from pursuing borrowers to collect outstanding loan balances after a short sale has been completed. Gov. Jerry Brown has signed SB 458 into law, which requires all lenders that agree to a short sale to accept the approved sale price as payment in full of the outstanding balance of all first and secondary mortgage loans. Local Realtors are hailing the new law as a victory for California homeowners and the state's distressed property market.

Bank of America says it is looking to downsize its mortgage servicing portfolio. Company executives told investors Tuesday that they will become more discriminating when adding mortgage servicing rights (MSRs) to their books and will be focused on selling off MSRs more aggressively. The company made roughly $70 million from MSR sales during the second quarter of this year, but on the whole posted its largest-ever three month loss - $8.8 billion - as a result of heavy losses within the consumer real estate services division.

DRI Management Systems, Inc. introduced a new technology module Monday to automate the process of remarketing REO assets. The company explained that its new DRI Broker system facilitates direct, electronic communications between real estate agents and lenders' REO departments, enabling asset managers to accelerate resolutions and lower servicing costs throughout the REO process.

For some borrowers, negative equity can become their rationale to stop making mortgage payments. The risk of such strategic default is rising among loans that have ""always performed,"" according to the credit analysts at Moody's Analytics. The agency found that these always-performing loans tend to be concentrated in robust housing markets that have held home values above the national average, but it's these areas where we may soon see a renewed increase in strategic defaults.

Home sales are expected to outpace 2010 sales by 3 to 5 percent for the remainder of 2011 as the housing market follows the overall economy, according to Freddie Mac. The GSE's latest outlook, released Monday, suggests the housing market is not likely to see a full ""double dip."" According to the report, June's disappointing jobs report likely reflects a temporary ""soft patch"" in the economy rather than an inflection point in economic growth. Freddie's economists expect housing to shadow GDP forecasts and improve over the balance of 2011.

State and federal regulators shut down four community-based financial institutions over the weekend two in Georgia and one each in Florida and Arizona. These latest closings bring the total number of names on the FDIC's failed bank list to 55 for the 2011 calendar year.