New foreclosure process rules in Illinois Feb 22, 2013 Will Lenders final start to feel the squeeze…???

Posted in Lender News Reports,REO -Lender Owned Properties by Administrator on the February 26th, 2013

New foreclosure process rules in Illinois Feb 22, 2013

foreclosure during 2009 to 2010

Anyone foreclosed on knows the financial tale of woe this sign represents.

Batman comics get a boost today.  New foreclosure process rules in Illinois Feb 22, 2013.  It seems on Feb. 22, the Illinois Supreme Court finally announced some new rules concerning the foreclosure process.  Find more coverage concerning the newest rules in the Chicago Tribune article, “New rules to govern Illinois foreclosures,” and officially in the State Journal-Register found here, “Illinois Supreme Court issues rules on foreclosures.”  Pow!!!  BAM!!!

Hurry up! Foreclosure settlement claims processing is almost over

Posted in Lender News Reports by Administrator on the January 15th, 2013  Refer to this press release regarding 2008-2011 robo signing claims which need to be filed by 1-18-2013 to be able to claim any of the monies recovered from the top 5 lenders processing foreclosures during that time.




FHA Streamline- Lower Interest Rates Spark Refinance Savings

Posted in Credit Notes,Financing- Loss Mitigation,Lender News Reports by Administrator on the October 15th, 2012

FHA Streamline- Lower Interest Rates Spark Refinance Savings

Mortgage rates continue to reach new lows, as FHA streamline refinance is in more demand. Homeowners with higher rate FHA mortgages pre-2009 are beginning to see the savings. Over 3 million FHA borrowers have a 5% or more rate.

You can almost guarantee that refinancing with an FHA streamline will save you money instantly. FHA guarantees it or you won’t be able to close the transaction.  It’s called “Net Tangible Benefit” you either qualify for a benefit by doing the refinance or lenders can’t refinance you. Borrowers with loans that were closed prior to June 1, 2009 would be most likely to see the largest savings – the minimum benefit is 5%. Those Borrower’s also find they are eligible for a reduced upfront mortgage insurance premium of .01%, as compared to the current upfront premium for a new loan which is 1.75%.

FHA’s mortgage insurance premiums also offer a lower premium cost as an added benefit.

FHA does not require an appraisal and therefore doesn’t have a Loan to Value ceiling.  So borrowers with upside down mortgages are more likely to qualify and closing costs are lessened. The only down side is “no cash out.”  It is expected that some Borrower’s could actually lessen their monthly mortgage debts to the point of reducing their loan terms which will eventually lessen the overall interest they pay over time.

FHA intended the streamline refinance program to reward borrowers that have paid their mortgages on time and have maintained their credit standing. It also has the power to help those with lower incomes to refinance due to it’s low documentation requirements.

If you are looking for more information on the FHA streamline refinance, you can email your request to

Were you in foreclosure in 2009 or 2010? Important Announcement Information

Posted in Welcome by Administrator on the October 6th, 2012

Were you in foreclosure in 2009 or 2010?

2009-2010 foreclosure help

2009-2010 foreclosure help- Federal Government review of Foreclosure filings.

Help for Homeowners in foreclosure during 2009 thru 2010 -the Federal Governments Video explanation. This is the site that you need to review in order to make sure that if you were foreclosed between 2009 and 2010 that you have the right to make sure that your file was handled properly.  You must apply for review before 12-31-2012 so please make sure that you do get the Free review in case you are entitled to part of the monies set aside for reimbursment by the government for wrongful filings.

Help for Homeowners during 2009-2010

Federal reserve video vault-  You can find Spanish and English video information to help you understand what is happening with the help for homeowners during those years.

You must file by 12-31-2012 in order for the federal govenment to be able to review your situation whether you are still in foreclosure or your home has already been sold at sheriff’s sale.  It is to your benefit for the government to review your file and make sure you were properly foreclosed upon.

Low appraisal valuations could turn your loan approval refinance sideways

Posted in Financing- Loss Mitigation,Lender News Reports,Real Estate by Administrator on the October 6th, 2012

Low appraisal valuations could turn your loan approval refinance sideways

appraisal value check

Make sure you know the recent sales in the area and their Square Footage.

My immediate subdivision has been hit hard by foreclosures and short sales. This makes my refinancing risky, especially when the appraisal numbers might not come in.   Accepting the fact that my condo is worth less today than when I bought it; I’m guessing the value of my condo is somewhere around the value of my existing mortgage.  Appraisals are expensive and so is the time a loan officer puts in to bring my refi forward so the best course of action… research!

“You can have everything in line- Credit Scores, Debt vs Income to manage the mortgage payments but low appraisal value is the No. 1 reason why loans are declined.

The most important thing is to have key information like an accurate square footage of the residence called GLA or Gross Living Area.  In Illinois-Cook County GLA is expressed as above ground living space.  In the case of split level houses; some houses, will not include lower level rooms or Square Footage and in others it will be included.  This poses another issue that owners need to be aware of when selling.  If it’s not in your benefit changing SFage on the tax records may not be important until you go to sell your home.

Checking thru your property assessors information will help you ferret inaccurate information that the appraisers use to value property.  The assessors office is the authority used to measure one home against the other.

Information as to what has sold in the last 6 months in your neighborhood is very important because the appraiser is going to go on the list of transactions from the assessors office and Multiple Listing Service.

Errors are common, checking in on the comparables in the area and doing your own research to make sure the comparables used are going to be valid is something you can do to make sure the appraiser used the right comparables.  In city environments a .5 or less radius or in the suburbs up to 3 miles may be used.  By the way, don’t blame the appraiser, blame the stored information.  Using a Realtor can help you to gather the information you’ll need to assure a smoother appraisal process, just ask for a CMA and look for similar units to yours that have recently sold.  You’ll need a minimum of 3 solds and 3 active listings with similar SFage to your home.  If they are high enough to warrant a refinance on your mortgage venture forward and begin the process.

One reason the SFage numbers are skewed and homeowners don’t care is that Property taxes are based on those assessor report cards.  This means if you think you are paying too much- you should be checking those numbers.  In many cases homeowners don’t opt to change the tax records because changing them would mean increased property tax payments.

Thanks to an election year and optimisim that our 2008/2009 low prices are behind us, we may in fact be seeing the 1st glimmer of light and improving pricing.  This means refinancing is becoming more of a possibility and homeowners trying to refi into a lower mortgage payment is becoming more of a reality.  Just make sure you check your surrounding area for values before you spend your money on an appraisal.


PMI removal at 80% loan to value-Homeowners Protection Act

Posted in Credit Notes,Financing- Loss Mitigation,Lender News Reports,Real Estate by Administrator on the September 21st, 2012

PMI removal at 80% loan to value-Homeowners Protection Act

PMI removal is only one of the many laws to be aware of when buying a home.  Most of these laws require the Loan Officer or Lender to take action. Rarely are there laws that allow the borrower to take action and get direct benefit. That is what the Homeowners Protection Act, also known as the PMI Cancellation Act, is for.

The Homeowners Protection Act is all about private mortgage insurance( PMI) and when it can, and when it will, be removed. It’s important to remember about PMI removal that the Homeowners Protection Act does not apply to government loans like FHA, VA or USDA
loans or loans with no PMI.

For conventional loans, PMI applies when the LTV is over 80%. The Homeowners Protection Act says that mortgage insurance cannot remain on loans for the duration. Once a borrower’s principal balance reaches 80% of the original value the borrower can request that the PMI be removed. Most of the time lenders will use the original appraised value of the property, however, they can use the current value if it has gone down or if the borrower pays for the appraisal and did improvements to justify an increase in value. When requesting PMI removal at 80% the lender can say no but when the LTV reaches 78% of the original value the PMI is required to have the PMI removal be automatically done.  Lenders are required to notify the borrower of the details of their PMI at closing, when the LTV reaches 80% and if the PMI has not yet been removed, when the LTV reaches 78%. This way the borrower doesn’t “forget” about their PMI and can have their monthly mortgage payment reduced when their loan to value qualifies.

Remember, when you are working with your loans that are required to have PMI, remember what the Homeowners Protection Act does for you. You will be one of the few borrower’s who know the details of the law and how it can help save money later.

Knowing the laws of the mortgage industry is not only required under the NMLS in order to become a licensed Loan Officer, it also helps realtors to provide a better service to our clients. Real Estate professionals who know about the laws and regulations in their industry tend to have more repeat clients and referrals. Therefore, there’s no better time than the present to get more familiar with the laws and regulations that affect our clients most. With our newsletters, we will continue to assist you in becoming an authority on housing so you have confidence based upon competence!

Read the full ACT here courtesy of the federal reserve at

PMI removal-opening the door to more informed home ownership

PMI removal-opening the door to more informed home ownership

Short Sale Outcomes why Loan Modifications don’t solve the problem

Posted in Credit Notes,Financing- Loss Mitigation,Real Estate,Welcome by Administrator on the September 20th, 2012

I have listened to recorded countless videos on how to convert homeowners off of loan modifications and into short sales. The basic reality that needs to be understood by both homeowner and agent is that when ANY paperwork is done on or for a short sale there is a 99% chance that there will either be a short sale or a foreclosure in the future.


Simple, excluding the 1% that hit the lottery and the homeowner gets a full rewrite or recast or even possibly an equity reduction on their existing loan terms, the reality is that they won’t!

It is just basic math.

If 99% of loan modifications do not convert to full new loans, why then do the banks keep pushing for them, why do agents help homeowners and why do homeowners want them?

Banks want information, Agents want to help homeowners and homeowners want to stay in their homes.

Here are the possible outcomes:

2, 5 or 10 year adjustment of terms and rate. This is the best case scenario when requesting a new loan modification. The horrifying reality is this, even if the homeowner makes every single payment they will eventually hit the end of the terms.  99% of these loans will not modify for a second time and all the homeowner has actually done is delay the inevitable sale of their home. To qualify for the longer term adjustment depends on the original loan. Basically the better the original loan the better the offer on the loan modification. A loan modification will always meet an end to its terms. Further it will correct the delinquent payments on their credit and in most cases becomes a short term fix for a long term problem need a very real solution
Trial loan modifications. There is a possibility of a trial loan modification becoming a short term loan modification. However the stats on homeowner not making payments even on trial loan modifications is staggering. The reality is simply this, if a homeowner gets a trial loan modification there is a 90% chance that it will go back in default (missed payment).

So the current market has created the band aid effect to get us through an election period and hopes that the economy and employment will magically all turn around.

Homeowners are trying hail marry passes to get to stay in their home and the banks/government are freezing the sale of REOs in an attempt to inflate home prices.

I still teach, preach and push this basic thought: Write it off, take the loss and move on! It’s a financial decision. Too much debt, too little income. Within 2 years, Short sale owners are able to go right back into the same bank they settled with 2 years ago and make an application for a loan… and get a mortgage approved. (Interest rates and Down Payments might be higher, but not much as you’ve settled to the terms of your previous loan by assisting in the sale of the property). You might find yourself gravitating back to the old neighborhood just in time to buy the neighbors property at current values.

Q and A- General Real Estate Questions

Posted in Real Estate,Real Estate- Q & A,Welcome by Administrator on the September 10th, 2012

Q & A

Real Estate Simplified

Inherited homes-  Repairs or mortgage payments can make inheriting a home a problem

Q: Mother-in-law gave my husband and Siblings her home before she passed. It is paid off, and there is no mortgage in this case. It needs repairs, but none of us can afford to pay for them.  If we have bad credit between all of us- What can we do with the home? – Louann G.

A: Even with good credit, it sounds as if no one could get a typical bank mortgage loan on the house in its present condition but check into FHA lending which has relaxed guidelines and you may be in for a surprise. I wouldn’t advise trying to fix the place up if you can’t get renovation funding from an FHA 203k loan (The Borrower would have to occupy, in this case).

Your 1st choice is to put the house on the market “as is”, at a bargain price, for an all cash payment.   There are always investors looking for fixer-uppers.

2ndly, hold out for an FHA 203k Buyer (Owner-Occupant) that can roll purchase and repairs costs into one loan.

3rdly, call a few real estate agents for advice.  If you find one that is interested in partnering with you or putting you in touch with a Rehabber you may be able to cut a deal for each others contributions to the renovation of the property and subsequent Sale.  (Use an Atty. as this is a complicated transaction).

Is it Illegal not to pay rent for years?

Q: I moved into an apartment in 2010. In the summer of 2012, my landlord wrote us a letter stating that he was no longer the owner of the property and the new owner would contact us. In case we needed to call, we were given a name of a bank and a phone number, which led me to believe this was a foreclosure or simply a case of throwing in the towel.

I tried calling the bank, and they wouldn’t speak to me because my name was not attached to anything. It is now April of 2012, I am still in the house, and I haven’t paid rent in two years. I’ve maintained the property (paid the heat and hot water that I previously was not responsible for, invested in a lawn mower and regularly taken care of the lawn and garden, replaced the washing machine, paid to have the dryer fixed, paid to have some plumbing fixed, etc … ).

I am basically a homeowner without a mortgage. I can’t figure out who pays the water or who pays the taxes. I’m just kind of at a loss of what is going on right now, but I’m just riding with it. Am I doing anything illegal?

A: Possibly a legal advisement is to have been stashing away the rent in a special account until you found out who was entitled to it.  And, of course, that would have to take into account the utilities and maintenance you’ve assumed responsibility for.

You could search the public records and the tax office to determine who owns the property, or have a lawyer do it for you. I suspect, though, that in your shoes, a lot of people might continue “just riding with it.”

Home Buyers and Sellers Beware! Fraud and more Fraud in Illinois

Posted in Credit Notes,Financing- Loss Mitigation,Legislation by Administrator on the August 23rd, 2012

Home Buyers and Sellers Beware!  Fraud and more Fraud in Illinois

Mortgage fraud not only continues to plague the housing market, it’s on the rise.  Whether you are considering a Loan Modification or Short Sale you need to be counseled by professionals in the business.  However, who can you trust to handle your most precious financial documents and negotiate/close the transaction?

When you sit down to sign on the dotted line for your contract to sell, mortgage to buy or home loan workout you’d better make sure you aren’t a victim – that’s especially true if you are a struggling homeowner.

Federal regulations and a more vigilant mortgage industry are trying to decrease the numbers of loan origination fraud and misrepresentation cases, but fraud that targets distressed homeowners and collusion schemes are on the rise, according to the LexisNexis 14th Annual Mortgage Fraud Report.

With a shift that more often targets vulnerable homeowners, the Federal Bureau of Investigation’s (FBI) mortgage-related Suspicious Activity Reports (SARs) numbered 93,508 in 2011, up from 33 percent in 2010, according to LexisNexis.

Consumers must be particularly vigilant in Florida, Michigan, California, Illinois and New York where industry fraud and application misrepresentation is most common.

Overall, the most common types of fraud in 2011 were application and appraisal fraud/misrepresentation. With  mortgage origination’s, application and verification of deposit fraud/misrepresentation were tops.

Not unlike organized crime; collusion, involving multiple professionals running schemes, is on the rise in foreclosures, short sales and the REO market.

The mortgage industry’s Mortgage Industry Data Exchange (MIDEX), incidents of verified fraud and material misrepresentation in loan originations, reveals 7 percent of the cases involved collusion in 2009, 9.7 percent in 2010 and 6.8 percent for 2011.

“This means that not only are more incidents involving multiple professionals being noted – but, as incidents submitted to MIDEX, they are being investigated, verified and reported.   According to the FBI’s Financial Crimes Report to the Public for fiscal year 2010 to 2011, ‘Current investigations and widespread reporting indicate a high percentage of mortgage fraud involves collusion by industry insiders, such as bank officers, appraisers, mortgage brokers, attorneys, loan originators and other professionals engaged in the industry.

So, What do you do about avoiding Fraudsters?

Let’s offer the following tips:

Know your team – Given collusion is an up and coming fraud segment, it behooves you to know who is working for you.

Check out your team- A referral from a trusted source, still check references, that licensing  is up to date and see if they are involved in reputable clubs and affiliations with good standing.

Interview several real estate agents (home inspectors, title companies, mortgage brokers, etc.) and check references before you commit to one.  Sometimes the one that tells you the good and the bad is better than someone that only gives you the good side in an attempt to sway you over to them.

Another important team member, that many under rate, is the real estate attorney.  In Illinois, an attorney is a necessary for pulling Title and helps with researching zoning, violations and is your fresh set of eyes overseeing the real estate transaction.  Find the best Real Estate Attorney-he’s worth his weight.  I repeat regularly, “your divorce atty. is not a Real Estate atty”.

An attorney is hired by you to represent your interests and ensure your rights are protected. they will help you understand all the legal documents and exactly what legal liabilities you have accepted.  There’s always the right way to protect yourself and the wrong way to handle issues.  Atty’s. are there to help you stick to what is the acceptable way.  let them keep everybody in check regarding your affairs.
Know your financing representative – Don’t let someone coax you into borrowing more than you know you can afford on a long term basis, just because you can qualify for a higher amount at the moment.  Short term thinking got our economy bloated and it burst.  Long term thinking helps you plan for a rainy day and keep it all in perspective.

Know what you are signing – Don’t sign documents with missing or incorrect information, including your income, debts or length of employment. Don’t sign anything you don’t understand. If you need help, consider reviewing the documents with your real estate agent, a real estate attorney truly anyone that is a 3rd set of eyes remember if it’s too good to believe- it probably is.
Get counseled – Speaking of counselors, taking a homeowner, financial or housing class or counseling session is an investment in your investment.  Classes in investing, rental management and credit building.  There are clubs and meetups, affiliations for everything these days.  Maybe helping at the local housing authority or talking it over with friends over lunch.

Beyond a sit-down-and-listen seminar or workshop, do not keep things a secret from your friends it’s proven to be one of the best things you can do to guard against fraud, protect your homeownership and avoid falling into trouble.  Anyone that asks you “not” to discuss this “great deal” with anyone needs to back off!

Wind Down of GSEs-FANNIE/FREDDIE can’t continue to hold profits

Posted in REO -Lender Owned Properties by Administrator on the August 17th, 2012

The Treasury Department Friday morning unveiled a bold new plan to speed up the dissolution of Fannie Mae and Freddie Mac, saying the two can no longer retain profits and must reduce their massive portfolio holdings at an annual rate of 15%.

In particular, Treasury notes that it wants to end what it calls “the circular practice” of the agency advancing funds to the GSEs simply to pay dividends back to Treasury.

According to a statement issued by the government: “Those portfolios will now be wound down at an annual rate of 15%—an increase from the 10% annual reduction required in the previous agreements. As a result of this change, the GSEs’ investment portfolios must be reduced to the $250 billion target set in the previous agreements four years earlier than previously scheduled.”

Currently, Fannie and Freddie hold about $1.4 trillion in mortgage assets.

Both GSEs recently returned to profitability–even after factoring in 10% dividend payments they must pay to Treasury which controls a special class of their preferred stock.

“With today’s announcement, we are taking the next step toward responsibly winding down Fannie Mae and Freddie Mac, while continuing to support the necessary AUG 17, 2012 process of repair and recovery in the housing market,” said Michael Stegman, counselor to the secretary of the Treasury for Housing Finance Policy.  “As we continue to work toward bipartisan housing finance reform, we are committed to putting in place measures right now that support continued access to mortgage credit for American families, promote a responsible transition and protect taxpayer interests.”

The agency said it wants to make sure that, “every dollar of earnings each firm generates is used to benefit taxpayers, and support the continued flow of mortgage credit during a responsible transition to a reformed housing finance market.”

Could this spur liquidations of  REO properties in the near future- they can’t run their companies forever…

AUG 17, 2012

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