Repossessions spike 66% as foreclosure crisis lingers

by Diana Olick

Thursday, 15 Oct 2015

New foreclosures may be back to nearly normal, but the mess from the epic housing disaster in the last decade is far from gone. Bank repossessions, the final stage of the foreclosure process, jumped 66 percent year over year in the third quarter of this year, according to RealtyTrac, a foreclosure sales and analytics company. It's the largest annual rise ever recorded in bank repossessions by RealtyTrac. More than 123,000 homes went back to the bank in just three months.

"In states such as New Jersey, Massachusetts and New York, a flood of deferred distress from the last housing crisis is finally spilling over the legislative and legal dams that have held back some foreclosure activity for years," said Daren Blomquist, vice president at RealtyTrac. "That deferred distress often represents properties with deferred maintenance that will sell at more deeply discounted prices, creating a drag on overall home values."

Getty Images

A bank owned sign is seen in front of a foreclosed home.

New York and New Jersey have the longest foreclosure timelines in the nation. In both states, foreclosures can take well more than three years. New Jersey has a formidable judicial process, as well as a strong voice in nonprofit housing activists working with distressed homeowners. Those combined to keep the foreclosure process at a snail's pace, until now. Banks have finally reached a point where they can push foreclosures forward, having streamlined all the extra paces required by laws and court rulings.

"Additionally, more nonbank lenders who purchased nonperforming loans over the past couple years are moving forward with foreclosure, having passed the foreclosure moratorium of six to 12 months required by many of these purchase agreements," said Blomquist.

With the backlog finally moving, New Jersey now has the nation's top foreclosure rate, just beating Florida, which was once the poster child for the housing crash and which also has a judicial foreclosure process. Foreclosure activity in the Garden State is more than twice the national average. New foreclosures there are falling, but bank repossessions jumped 351 percent from a year ago. Atlantic City now boasts the highest metropolitan foreclosure rate. Trouble in the local casino economy now is causing more new foreclosures, but the bulk of the bank repossessions are on homes that were in default well before that.

While states like Michigan, Texas and Washington are also seeing increases in foreclosure activity, their numbers are far closer to normal levels. Foreclosure starts historically speed up between September and November before holiday moratoria set in.

"The third-quarter increases are a sign that the foreclosure market has settled into a normalized pattern close to or even below precrisis levels, and in those states the overall housing market should easily absorb the additional foreclosure activity with little impact on home values," added Blomquist.

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Fuller impact of home foreclosure debacle hits NJ

July 19, 2015 - BY RICHARD NEWMAN

The number of New Jersey home repossessions by lenders has soared in the past two years and is on track to increase again in 2015, in sharp divergence to the national trend.

Completed foreclosures, where banks and mortgage companies have taken the homes, climbed 34 percent in the state last year, to about 5,780, after an 11 percent surge in 2013, according to The Record’s analysis of RealtyTrac data. By contrast, on the national level, completed foreclosures fell by double digits in each of the past three years.

In the first three months of this year, Bergen County was on pace to nearly double last year’s total of sheriff’s auction sales with 201 properties sold.

A CoreLogic report released Tuesday showed that in May 4.9 percent of mortgaged homes in New Jersey were completed foreclosures, the top rate in the country. The percentage of homes where the mortgages are seriously delinquent also was the highest at 8.4 percent.

The statistics indicate the foreclosure debacle, which has eased in other states following the housing meltdown that began in 2007, may only now be peaking in New Jersey, where foreclosures had been crawling through the system.

The reasons for the slow processing include a state judiciary that has tried harder than other states to hold banks accountable for illegal and improper paperwork. Also, New Jersey’s non-profit housing groups, which have support in the state Legislature, have worked to help keep homeowners in their homes. It has taken debt collectors about two years and 10 months on average from the time an initial notice is delivered until the property is repossessed, according to real estate information company RealtyTrac. Only Hawaii’s process is longer.

Now repossessions are moving faster. According to housing activists and lawyers who defend homeowners faced with foreclosure, the acceleration has coincided with a pickup in the real estate market. Although bankers deny it, homeowner advocates say that uptick seems to have made banks more eager to complete foreclosures, cash out and recover what they can from their losses.

“There have been secondary-market buyers coming in as a reaction to the housing market starting to rebound a bit,” said Adam Deutsch, a lawyer with Denbeaux & Denbeaux in Westwood, which has defended hundreds of New Jersey homeowners in contested foreclosures.

Other contributing factors underscore the complexity of the situation:

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CFPB Delays New Disclsoure Rules Through 10/1

JUN 17 2015

Statement by CFPB Director Richard Cordray on Know Before You Owe Mortgage Disclosure Rule

WASHINGTON, D.C. — Today, Consumer Financial Protection Bureau (CFPB) Director Richard Cordray issued the following statement on the Know Before You Owe mortgage disclosure rule:

“The CFPB will be issuing a proposed amendment to delay the effective date of the Know Before You Owe rule until October 1, 2015. We made this decision to correct an administrative error that we just discovered in meeting the requirements under federal law, which would have delayed the effective date of the rule by two weeks. We further believe that the additional time included in the proposed effective date would better accommodate the interests of the many consumers and providers whose families will be busy with the transition to the new school year at that time.”

The public will have an opportunity to comment on this proposal and a final decision is expected shortly thereafter.

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7 of the 10 counties in America with the highest property taxes right here in New Jersey

By Paul Milo, April 28, 2015

It's no secret that New Jersey homeowners are hit with some of the highest property taxes in the nation. But just how high, relative to other parts of the country, might be a bit of a shock.

A typical homeowner in Bibb County, Ala., paid just $228 in property taxes in 2013,according to an analysis by Zillow, the real estate website. Compare that to someone paying the median in Paramus or Ridgewood in Bergen, who shelled out $9,546 — about 45 times as much.

Bergen and Bibb lie on opposite ends of a list of median property tax rates nationally. Bergen was third-highest in the country, and the highest in New Jersey, while Bibb joined several other Alabama counties boasting some of the very lowest property tax bills for single-family homes.

Bergen, meanwhile, is one of several New York City-area counties dominating the top 10. Those counties had annual property taxes several times the 2013 national median of $2,132, based on the Zillow analysis, which examined counties in the 50 largest metro areas for which sufficient data was available.

Elsewhere in New Jersey, however, property tax bills, while nowhere near the lowest in the country, were somewhat closer to the national median, according to figures compiled by NJ Advance Media in February (NJ Advance Media looked at average county bills, not the median figure used by Zillow). The average bill in Cumberland in 2013, for instance, was just a little over $3,700 a year, while in nearby Salem, the average was about $4,800.

Per Zillow, here are the counties with the 10 highest and 10 lowest median property tax bills in 2013:

Highest:

• Westchester, N.Y., $13,842
• Rockland, N.Y., $10,550
• Bergen, NJ, $9,546
• Essex, N.J., $9,288
• Nassau, N.Y., $9,091
• Passaic, N.J., $8,978
• Union, N.J., $8,926
• Morris, N.J., $8,549
• Hudson, N.J., $8,407
• Hunterdon, N.J., $8,392

Lowest:

• Tunica, Miss., $216
• Bibb, Ala., $228
• Walker, Ala., $244
• Blount, Ala, $344
• Amelia, Va., $358
• Butler, Pa., $397
• Lincoln, Okla., $402
• Fayette, Tenn., $410
• Meriwether, Ga., $457
• Saint Clair, Ala., $470

You can read the entire article here.

The deadline to file tax appeals and LOWER your taxes is April 1st. Contact us for a free consultation to see how we can lower your taxes.

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New, Simpler Mortgage Disclosure Forms Could Delay Closings

April 20, 2015, by Michele Lerner:

For years, home buyers taking out what was probably the biggest loan of their life would get a stack of disclosure forms with small print alluding to things like a “variable rate feature” and a “prepayment penalty.” As it turned out in the housing bust of 2008, many of them didn’t quite realize that these phrases meant their payments could skyrocket after an initial period, or that they’d be penalized for paying off their loan early.

But the Dodd-Frank Act of 2010 forced the Consumer Financial Protection Bureau to make those disclosure forms, which are meant to explain the conditions of the mortgage and the closing costs, more consumer-friendly. The agency first unveiled the new forms in late 2013, and recently reminded consumers and the industry that they would go into effect Aug. 1.

But real estate pros now say they’re concerned that the simpler forms, which must be provided on a tighter timeline than before, might actually slow down closings—at least initially.

“It will probably be painful for the first three to six months after we start working with the new rules and forms, and some closings could be delayed,” said Patrick Cunningham, a partner and vice president with Home Savings & Trust Mortgage in Fairfax, VA. “It’s very important that buyers work with a Realtor®, lender, and title company that they trust to avoid delays if possible.”

The disclosure forms are used by title companies and lenders, and real estate agents sometimes show the forms to buyers so they’ll know what they will sign at settlement, or closing.

“The new mortgage disclosure forms coming in August will help consumers comparison shop for mortgages and avoid surprises at the closing table,” said CFPB Director Richard Cordray on March 31, as he presented to the public a mortgage toolkit intended to guide borrowers through the mortgage process and make the best use of the new forms.

These are what borrowers will receive as of Aug. 1:

• Loan estimate. This form replaces both the early Truth in Lending statement and the good-faith estimate and provides a summary of loan terms as well as estimated loan and closing costs. Buyers must receive this three days after applying for a loan, so they can have time to shop around.
• Closing disclosure. This form replaces both the final Truth in Lending statement and the HUD-1 settlement statement. It sums up the final costs for the loan and closing and explains how payments are to be made. Buyers must receive this three days before closing, so they have enough time to fully review it.

You still have to read the forms

Although the new forms could be good for consumers because the intent is to clarify their loan terms, Cunningham said borrowers still need to do their part.

“People don’t always read their documents even though we ask them to,” he said. “At least [the new forms] look a little clearer than the old forms.”

Cunningham says the biggest problem he anticipates after Aug. 1 is complications in getting the closing disclosure finalized and delivered to the buyer three days before settlement.

“Right now, the general practice is that Realtors schedule a walk-through the day before or the day of settlement, but sometimes changes need to be made after a last-minute negotiation between the buyers and sellers, and sometimes loan documents get sent over just prior to the closing,” Cunningham said. “In theory, this will all happen three days before settlement—but in practice, I expect some settlements to be delayed because of the three-day rule.”

Delaying a settlement can cost both buyers and sellers money if moving arrangements have already been made. This could even affect another closing if the sellers are purchasing another home, Cunningham said, adding that delays can be avoided as long as the lender, real estate agent, and settlement company remain in communication.

Is ‘optional’ optimal?

Diane Evans, president of the American Land Title Association and vice president of Land Title Guarantee Co. in Denver, said she’s disturbed that on the new loan estimate form, owner’s title insurance is labeled as “optional.” The old good-faith estimate forms merely said, “You may purchase an owner’s title insurance policy to protect your interest in the property.”

“For a one-time fee paid at the closing table, an owner’s title insurance policy protects a home buyer from having to pay legal fees and claims that were not discovered during the title search, such as back taxes owed by previous owners, compensation to an unknown heir for their interest in the property, or even if there was a forged signature on a deed,” Evans said. “The introduction of the word ‘optional’ may diminish the perceived value of this insurance.”

In addition, Evans noted, although owner’s title insurance can be paid for by either the buyer or the seller, the new forms assume the buyer will pay. 

“Hopefully, everyone will be able to work out their systems and processes ahead of time,” Evans said, “but it would be easier if the new policies could be phased in rather than introduced with a hard stop on Aug. 1.”

So if you’re buying a home this summer or fall, stay in close touch with your lender, agent, and title company to avoid last-minute glitches.

The entire article can be seen here. 

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I received this from a realtor that we work with. We make sure to get attorney review wrapped up as fast as possible for our clients!

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We received this from a client we have been assisting with their transactions:


Don't hesitate to contact us for all your legal needs.

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We are very proud to announce that Daniel Barli has once again been selected as a New Jersey SuperLawyers' Rising Star for 2015!!

http://www.superlawyers.com/new-jersey/lawyer/Daniel-Barli/06671f42-64a6-4520-b803-c593f956f530.html

Read about the selection process:http://www.superlawyers.com/about/selection_process.html


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N.J. fourth in nation in number of vacant foreclosures

.MARCH 14, 2014

BY KATHLEEN LYNN

STAFF WRITER | 

THE RECORD

February level doubles from year earlier

New Jersey continued to deal with a backlog of distressed properties in February, ranking fourth in the nation in both the number of vacant foreclosed homes and the number of foreclosure filings, a company that tracks the market reported on Thursday.

While the worst of the foreclosure crisis has passed in most of the nation, New Jersey foreclosure activity doubled from February 2013 to February 2014, according to California-based RealtyTrac. About one in every 739 housing units in the state faced a foreclosure filing during the month. At the same time, overall foreclosure activity dropped 27 percent in the U.S. overall.

And in New Jersey, 8,595 homes were vacant and in foreclosure, up 24 percent from the third quarter of 2013.

"The biggest threat from foreclosures going forward is properties that have been lingering in the foreclosure process for years, many of them vacant with neither the distressed homeowner or the foreclosing lender taking responsibility for maintenance and upkeep of the home," said Daren Blomquist, vice president of RealtyTrac.

"These properties drag down home values in the surrounding neighborhood and contribute to a climate of uncertainty and low inventory in local housing markets."

New Jersey's foreclosure process is one of the slowest in the nation, taking more than 2 1/2 years, on average. One reason is that New Jersey is among about two dozen states where foreclosures go through the courts.

However, the mortgage industry has begun moving a large backlog of distressed properties that piled up in the state while the industry dealt with questions about whether it abused homeowners' rights in the rush to evict.

Read the entire article here and let us know how we can help you take advantage of these opportunities.

Daniel Barli, Esq. 

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Boomerang home buyers are coming back

By Ben Rooney, January 27, 2015

NEW YORK (CNNMoney)

Millions of Americans who lost their homes during the foreclosure crisis are now poised to become homeowners again.

That's according to a new report from RealtyTrac, which estimates that 7.3 million so-called "boomerang buyers" will return to the U.S. housing market over the next eight years.

Foreclosures and short sales skyrocketed after 2007 during the darkest years of the financial crisis and Great Recession. But with the economy gaining momentum and hiring picking up, many foreclosed on homeowners are in a position to buy again.

Half a million home buyers: Homeowners can recover from foreclosure in as little as three years, but seven years is the "conservative" amount of time it takes to rebuild a credit score, according to RealtyTrac. That means many homeowners who lost their homes in 2007 should be able qualify for a new home loan this year.

More than 500,000 people will fit this description in 2015, according to RealtyTrac. The number jumps to 1 million next year, peaks at 1.3 million in 2018, then tapers off by 2022. Read the entire article here and let us know what we can do to help you get back into a new home.

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Adding Value to Your Home

Following these 10 tips will help to add value to your home and increase your chances of a sale.

The Top 10: Tips to Add Value to Your Home

1. Clean, organize, and neutralize your space: Unclutter your house to make it look bigger and cleaner. Buyers need to be able to envision their own belongings in the home; so, avoid using bright colors and too many personal effects.

2. Keep Your Lawn Green: Get your lawn in shape. A patchy lawn takes away from the home's overall appearance. Your local hardware store has supplies to re-seed those unhealthy areas.

3. Add insulation to save energy: The most inexpensive way to increase your home's energy is to add insulation, which can reduce heating and cooling costs by more than 25%.

4. Update kitchen appliances: The kitchen is often the room that buyers gravitate towards first, and an updated kitchen can help sell your home. You don't have to remodel your kitchen to give it a new look. Updating your appliances to the current standard and replacing cabinet doors and hardware can make a big impact at a relatively low cost.

5. Update bathroom fixtures: A little change can go a long way when it comes to the look of your bathroom. Updating simple fixtures such as your sink and faucet can give any outdated bathroom style.

6. Build a fence: If you're trying to sell a house, the appearance of a fence adds value to the home overall. Buyers with children or pets will appreciate the privacy and security of an enclosed backyard.

7. Repair the gutter: Ensuring that your gutter is clean is crucial in protecting your home against water damage.

8. Light up the outside: An easy and inexpensive way to increase your home's outdoor space is to add lighting. It makes it more appealing and safer.

9. Store and organize: Ample storage space is a plus, especially when it comes to garages and closets. Efficient closet structures can help keep your clothes organized and can save space.

10. Polish off the basement: Rather than adding an additional room, it is more cost-efficient to remodel your basement. This adds value and usable space.

(c) Century 21

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