BofA Gets Up Close and Personal with Distressed Homeowners

Bank of America organized 45 dedicated outreach events this year in local markets across the country where the lender is seeing high levels of mortgage delinquencies among its customer base.

“Our goal is to get at the consumer,” Ron Sturzenegger, BofA’s legacy asset servicing executive, told DS News at one such event held in Irving, Texas, just outside of Dallas earlier this month.
The company undertakes an aggressive marketing campaign ahead of each of its outreach events to get the word out to mortgage customers in the area who are having trouble making their payments.
The communication blitz includes direct mail, personal phone calls, email messaging, and partnerships with local marketing agencies to reach as many distressed homeowners as possible.
Unfortunately, Sturzenegger says many customers “choose not to engage.” In Irving, for example, pre-event outreach efforts targeted 7,500 BofA borrowers. Of those, only 500 registered to come in to the Irving Convention Center and talk one-on-one with a BofA loss mitigation specialist.
That’s nearly a 7 percent response rate, which is relatively high, according to Sturzenegger. He says in some cities, they see only a 1-2 percent response rate.

“We’re a bit disappointed in the numbers at some events,” Sturzenegger said, “but we’re going to keep at it.”
The out-of-pocket expense to put on each event, which typically lasts three days, can run pretty high – from renting out a facility, to promotional and marketing materials, to full-service staffing.
Nevertheless, Sturzenegger says, “We’re going to keep doing it as long as we need to.”
Just how long that will be is hard to predict, but with mortgage delinquencies and foreclosures still at high levels, Sturzenegger says Bank of America expects to host at least the same number of local outreach events in 2012.
Those customers who do accept BofA’s invitation to attend a local event can expect a solution to their mortgage troubles quickly – whether it’s a loan modification or other foreclosure alternative.
Sixty percent of customers who come in with all the documentation they’ve been instructed to bring receive a decision on-site. Those who aren’t decisioned that very day will have an answer from the bank within 30 days.
In addition to one-on-one face time with a loss mitigation specialist, the homeowner experience at these outreach events includes a 30-minute educational session explaining their options and alerting them of scams to avoid, and a sit-down with a local nonprofit housing counselor to assist with budgeting and financial planning.
Bank of America’s 45 dedicated outreach events, such as the one held in Irving, are what the bank calls its single-servicer events, and they are just one vehicle the lender employs to get in front of distressed homeowners.
BofA also takes part in multi-servicer events held across the country, such as those put on by the HOPE NOW Alliance, and it has a mobile mortgage help van that makes stops in hard-hit communities.
In addition, Bank of America has set up brick-and-mortar customer assistance centers in 50 cities where borrowers can meet face-to-face with loss mitigation specialists. (Carrie Bay - dsnews.com)

Mortgage Debt in the U.S. Continues to Contract

The ongoing turmoil still gripping housing markets across the country has manifested itself in the Federal Reserve’s macro assessment of household wealth and capital flow.

With foreclosure stripping millions of Americans of their largest asset and potential homebuyers still watching for the market bottom, the total sum of home mortgage debt in the U.S. has dropped to its lowest level in nearly five years.
Outstanding mortgage debt contracted by 1.8 percent over the third-quarter period to $9.88 trillion, according to the Fed’s ‘Flow of Funds’ report.

Gregory Daco, principal U.S. economist for IHS Global Insight, says “deleveraging is still very much ongoing especially on the housing front with price declines keeping many potential buyers and sellers on the sidelines.”
This deleveraging has cut the ratio of mortgage debt to disposable income to 85 percent. That’s from 100 percent in late 2007.
The Fed’s latest report shows household net worth also took a big hit during the third quarter.
The value of real estate assets actually rose $102 billion, but volatility in the stock markets depreciated financial assets by $2.66 trillion.
All in all, household net worth in the U.S. lost $2.44 trillion over the July-to-September period.
Daco says the third-quarter net worth decline is the largest since Lehman Brothers’ collapse in September 2008.
IHS Global Insight expects household wealth to rebound by just under $2.0 trillion in the last quarter of 2011 as stock markets have recouped most of their losses since their late-September trough. (Carrie Bay - dsnews.com)

Alternative property market offers attractive prospects in 2012, says Kames Capital

Alternative property sectors could offer some attractive opportunities for real estate investors in 2012, according to Phil Clark, head of property investment at Kames Capital. Clark, who heads the property fund management team at Kames Capital, said that alternative property sectors such as student accommodation could offer some appealing opportunities in what will be a challenging 2012. ‘My view is that 2012 will be every bit as challenging as 2011, however, there are still many good opportunities for property investors to make well informed decisions. In particular I believe investors should consider a greater exposure to alternative sectors such as residential property, student accommodation or healthcare property. One of the key attractions of these alternative sectors is they generally have a high income yield, an ability to track inflation and have low vacancy rates,’ he explained. Clark said investors should look at the fundamental drivers which make them attractive compared to some commercial properties. ‘Investors need to give greater credence to the opportunities and investment attractions such as basic demand, which make the alternative property sectors stand out from other commercial property investments,’ he added. In terms of residential property, Clark believes that the south east of the UK is going through a major structural shift from a high ownership model to a need for greater rental accommodation, which is driven by the lack of mortgage finance. ‘This is creating rental increases in the order of 7% per annum in some locations, coupled with a lack of supply to meet demand,’ he said. Meanwhile, despite recent protests over increased tuition fees and a fall in the number of university places available, Clark said opportunities still abound in student property. ‘Student accommodation demand for the best universities is leading to typical annual vacancy rates of less than 2%,’ he explained. Finally Clark points to the percentage of the UK population becoming elderly and needing specialist nursing care which is being factored into the demographic profile. ‘Despite this increase in numbers there are not enough quality nursing homes to accommodate this demand making this an attractive sector to invest in,’ he added. (propertywire.com)

Mortgage Default Risk Edging Toward 'Normalcy'

Lenders and investors should expect defaults on mortgage loans currently being originated to be 31 percent higher than the average of loans originated in the 1990s, according to a new report from University Financial Associates (UFA).

The UFA Default Risk Index for the fourth quarter of 2011 edged lower to 131 from last quarter’s revised 133. The index’s baseline of 100 correlates to the default risk of loans made during the 1990s.
As a point of comparison, UFA’s index reading measuring the risk associated with mortgage default was 141 as recently as the first quarter of this year. For what UFA says were the worst vintages of this cycle (2006-2008), the default index soared above 225.

UFA says its Default Risk Index finds that residential mortgage default and prepayment risks are continuing their return to normalcy.
“Despite continuing high unemployment and the threat of contagion from Europe, our Default Risk Index has improved,” said Dennis Capozza, who is the Dale Dykema professor of business administration in the Ross School of Business at the University of Michigan, and a founding principal of Ann Arbor, Michigan-based UFA.
“With consumer balance sheets improving and mortgage rates at record lows, the stage is set for a recovery in the housing market, for which lenders and investors may do well to prepare. We await the catalyst,” Capozza said.
The UFA Default Risk Index measures the risk of default on newly originated prime and nonprime mortgages. UFA’s analysis is based on a “constant-quality” loan, that is, a loan with the same borrower, loan, and collateral characteristics.
Each quarter, UFA evaluates economic conditions in the United States and assesses how these conditions will impact future mortgage defaults, prepayments, loss recoveries, and loan values.
The index reflects only the changes in current and expected future economic conditions, which the company says “are much less favorable currently than in prior years.” UFA’s current assessment has GDP growing just above trend for the next two years and at trend thereafter, but does not envision another recession. (dsnews.com)

Sellers: Real estate agents can't read your mind

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The chores of listing and selling a home should not be taken lightly, nor handed off -- especially in this market.
Typically, when you contract a real estate broker to help sell your home, you are promising to pay for services rendered if the broker finds a person ready, willing and able to buy your home.
The first thing to remember is that nobody can read your mind. Make sure your agent knows your concerns and keep all communication lines open.
In two recent cases, expectations were not expressed, mainly because the sellers -- an executive at a financial services company

The couple chose to continue touring the country in their RV and asked one of their children to be the point person with the real estate agent for their waterfront getaway. The executive, in a similar fashion, turned over tasks related to selling her downtown condo to her office secretary.
Both sellers returned home and were unhappy with the way their homes were being marketed. The couple felt that ads describing their home were poorly written, for-sale signs were not properly placed and that the agent was not doing enough to get other agents to preview the home.
The executive expected her downtown condo to be better exposed to the in-city business community. She said she felt there were more aggressive, creative agents in the industry than the one she hired.
What both parties did not do was work directly with the agent, leaving assumed requirements and expectations to fall between the cracks. Frustrated and upset, each seller wanted out.
Could they rescind the listing agreement without the broker's consent? When a seller elects to cancel, is the broker entitled to a commission?

• The seller can usually cancel the listing agreement at any time, whether or not the seller has legal grounds to do so. A listing agreement typically creates what is known as an "agency agreement" with the broker, and it can be canceled by the principal (seller). It's always best to cancel in writing.
• If the seller cancels the agreement without having legal grounds, the broker could be entitled to payment. Legal grounds for cancellation include broker malpractice, violation of the broker/agent fiduciary duty, or breach of contract by the broker. If the broker is not at fault, the broker could be entitled to "damages" even if the house does not sell during the unexpired term of the listing.

Damages could mean advertising costs and other out-of-pocket expenses in servicing the listing. If the house sells during the unexpired term of the cancelled listing, the law presumes that the terminated broker would have made the sale, thus entitling the broker to a commission. However, if the seller can prove the broker would not have made the sale, the seller can avoid payment of the commission.
Most of the time, a seller can cancel a listing with one agency and move it to another broker in the same multiple listing service (MLS) and be liable for only one commission.
For example, if you cancel your listing with Billy's Real Estate and move it to Nancy's Real Estate, and both are members of the same MLS, you usually are relieved of your obligations to Billy by paying Nancy a commission when the house is sold.
Despite what you may hear, all commissions are negotiable. Some agents are very open to negotiating or deferring the amount of the commission, while others are insulted at the thought of bargaining. Also, some agents work for a flat fee or other payment structure, or even work under contracts that allow the seller to independently bring in a buyer without necessitating a commission payment to the broker.
When you sign a listing agreement, you are actually agreeing to work with the agency and its boss, or broker. Many agents also hold the "broker" designation, which means they have undertaken additional classroom instruction and testing.
Be realistic when you sign a listing. Discuss all services, explain your expectations and don't expect miracles. Interview a few agents even though you might already be dead-set on one to represent you. Check references and then choose the one you think will do the best job.
And plan on staying involved after the initial agent interview. Your secretary may be worth a million bucks inside the office, but you should be the point person on all sales matters regarding your home.
(Tom Kelly - Inman News)

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(Prices are subject to change and include furniture, fittings and equipments. Dollar pricing are indicative and will change monthly)
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Italy -Trentino-Alto Adige, Bolzano Province, the village Siusi allo Sciliar - Hotel for Sale

For sale 3 star apart hotel in the heart of the village Siusi at just 200 m from the ski plant. Near to the hotel there is a bus stop, where there is every 20 minutes a bus to the ski area.

Total square area of the hotel – 1000 sq.m, with 16 apartments of which 2 with two bedrooms.

Offered at:  € 3.800.000

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Tough year predicted for French property market in 2012

With Credit Agricole, one of France’s biggest banks, forecasting a national fall in property prices of 5 to 6% next year with an 8% fall in overall sales, the French real estate market could face a tough year.

This year hasn’t been too bad with prices in and around Paris and in Provence and the South of France generally increasing. But it has been a mixed bad with parts of the country seeing price falls.
Now France is embroiled in the middle of the eurozone crisis and the property market is unlikely to go unscathed. Figures for 2011 won’t be available for some weeks yet but anecdotal evidence suggests transaction levels are likely to be at their lowest for 40 years, almost 50% down on 2007 according to some estimates.
The FNAIM, the largest body representing estate agents in France has reported a range of price fluctuations for 2011, from a fall of 4.6% in Brittany to an increase of 10.1% in Champagne Ardenne.
But the key is pricing, according to estate agents. If a property is priced attractively it will sell, they say, and those with the money can still get a relative bargain in some locations.
‘The market is in danger of stalling unless we all take a sensible view on pricing. If owners and estate agents are realistic with their expectations and valuations then the French property market can remain amongst the healthiest and most attractive in Europe,’ said Trevor Leggett of Leggett Immobilier.
‘We play host to more tourists than any other country in the world for a variety of wonderful reasons and we regularly top the polls for offering the highest quality of life. In troubled times owners and investors seek safe havens and they simply don't come more secure or enjoyable than France,’ he explained.
‘I'm optimistic that, with prudence in the short term, the French property market has an extremely healthy mid to long term future,’ he added.
He also pointed out that for those with the finance to buy prices have never been more attractive and you can find an old, stone farmhouse in the country with large open fireplaces, beamed ceilings and terraccotta tiled floors at prices similar to those you would have paid in 2004/5.

One significant change is the origin of overseas buyers. Agents report an increase in buyers from countries other than the traditional base of the UK, Germany and the Netherlands. There has been an increase in inquiries from Asia, North America, South America, Africa and Australia.

‘One noticeable trend has been an increasing number of sales to both expat British buyers who are currently living overseas and would rather move to France than return home and expat French buyers who are returning home from a stint overseas,’ said Leggett.
Getting a mortgage is also likely to become harder. This time last year French lenders had some of the lowest fixed rates seen in Europe but inflation has led to rates rising again.
‘We have seen increases in the main European Central Bank rate from 1% back up to 1.5%. These increases put the brakes on the mini boom in French property prices which saw Paris experiencing off the chart price rises, whilst France as a whole was ticking over at a respectable 6% average for the year,’ said John Busby, director of French Private Finance.
He explained that the current unease brought about by the sheer scale of exposure to the debts of the less fiscally responsible nations in the eurozone has led to an increase in the mortgage rates for new customers across the board despite interest rate cuts being predicted.

‘The problem is that these cuts are not being passed on the form of cheaper variable and capped rate loans for new customers as banks maintain or increase their margins in readiness for impending new Basle III capital base ratios and to pay for the increased costs of wholesale borrowing,’ said Busby.
‘However, competitive rates are still available for a number of local banks in France with a 20 year fixed rate possible at 4.25%, less than 1% of the all time lowest rate,’ he added. (PropertyWire)

Portugal - Five Stars Luxury Hotel - for sale

The palace was built in the beginning of the XIX century. It is located in a residential area, with an wonderful view over the river.
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It is one of the best luxury Portuguese hotels, having received throughout the years several nominations and awards.
Offered at: $199,900,000
For more information visit: Oresy.com

No plans for new property tax in Poland

On November 19 Poland’s Prime Minister Donald Tusk assured property owners that there are no plans to introduce some form of cadastral tax. Currently, the amount of property tax depends on its surface. The municipality determines the rate with upper limits being set by an Act. As a result, the owner of a house located in the center of Warsaw, might pay the same as the holder of a similar house in a small town.  It has been about ten years since mention of a tax has been included in an electoral platform.
Ms Olimpia Bronowicka (left), spokesperson for the Polish Real Estate Federation, said of such a property tax: “A common opinion of real estate experts in Poland is that the implementation of the ad valorem property tax would be very advantageous for the state and its revenue stream. As one of its implications, the most affluent people would live in the most prestigious locations in the cities. That in turn should contribute to higher attractiveness and improved curb appeal of streets and quarters being a showcase of the city.”
“Since the implementation of the ad valorem tax translates into higher costs of living, it will trigger much opposition from the majority of people. Nobody wants to be deprived of what he or she has possessed so far and have to pay more. The implementation of the ad valorem taxation appears such an unpopular decision that so far no government and no political party has undertaken the effort to put it into practice,” Bronowicka.
According to a recent news item posted at the Federation site, it has been about a decade since a tax was mentioned in an electoral program. Since then, politicians have renounced the idea.

ICREA

Island of Capri - ITALY - Ancient castle for sale

Ancient castle in the Italian “Mecca” , the Capri Island. The square metre of the area is 1000[m]2. This is an exclusive villa, is one of 12 villas of Tiberius, situated in the most charming spot of Capri extremely panoramic. Living room 200sq.m, 2 suite, 7 bedrooms, 3 singles, kitchen - 50 sq.m, 7 bathrooms, utility rooms, laundry, cellar, storage space, swimming pool. The castle is located in surprising place, it is raised above the emerald sea. The castle has straight access to the sea with the excellent beach, particular road, in the bay - particular moorage, to the territory - takeoff and landing strip for the helicopter, the pond with the preheating and all most exclusive conveniences. The owner of the castle wanted to convert it into an hotel with 10 exclusive luxury rooms with a spa centre. The location of the island it’s convenient and it’s possible to reach it from the port of Naples.
Price: On request.

For price request and more information contact seller at Oresy.com

GSEs Announce Foreclosure Moratorium for the Holidays

Fannie Mae and Freddie Mac announced temporary foreclosure moratoriums on all single-family homes and two-to-four unit properties over the holidays.

Both companies will enforce the moratorium from December 19 through January 2.
“The holidays are meant for families to spend time together, especially if they’ve gone through the stress of financial challenges and foreclosure,” said Terry Edwards, EVP of credit portfolio management at Fannie Mae.
“No family should have to give up their home during this holiday season,” he said.
The moratorium will not affect the pre- or post-foreclosure processes, the GSEs said in their announcements.
Servicers may continue the administrative processes involved in foreclosures, but evictions will be delayed until after the start of the new year.
“If the property is occupied, our foreclosure attorneys will suspend the eviction to provide families a greater measure of certainty during the holidays,” said Tracy Mooney, SVP of servicing and REO at Freddie Mac. (DSNews)

Unemployment Rate Drops to 8.6%

The nation’s unemployment rate fell to 8.6 percent during the month of November, as employers added 120,000 new jobs to their payrolls, the U.S. Department of Labor said Friday.
By the government’s calculations, the unemployment rate declined by 0.4 percentage point from 9.0 percent reported in October to hit its lowest level since March of 2009.

Analysts at IHS Global Insight were expecting the economy to add 125,000 new jobs last month, but the rate to hold at 9.0 percent.
Earlier this month, IHS published the graphic above, illustrating its projections of how long it will take each state to return to peak levels of employment.
Employment assessments for both October and September were revised upward. The Labor Department says total nonfarm payroll employment rose by 210,000 jobs in September rather than the 158,000 previously reported. October’s numbers were revised from 80,000 new jobs to 100,000.

Still, the 72,000 more jobs than previously thought over past months isn’t enough to cut the unemployment rate by forty basis points.
Much of the drop can be explained by the fact that those who’ve been unemployed for extended periods are no longer counted as part of the Labor Department’s unemployed population as they become ineligible to claim unemployment benefits.
The Labor Department’s report does indicate that the size of its measurable labor force contracted by 315,000 persons.
Commenting on the latest numbers, Ed Delgado, CEO of the Five Star Institute, said, “While the decline in the national unemployment rate is significant [40 basis points] the comprehensive view of employment, or U6 rate, that includes all marginally attached to the labor force, remains high at 15.6 percent and 60 basis points higher than a year ago.”
Delgado went on to explain, “Some of the decline can be attributed to seasonal employment trends as we approach the holidays and we remain cautious that a one month decline of this magnitude does not necessarily suggest a sustainable trend … that said, the abrupt decline is an impressive one-month reduction in unemployment.”
The analysts at Capital Economics agree with that assessment. The sharp drop-off “is another illustration that the U.S. economy is, for now at least, shrugging off the global economic downturn and fears about the collapse of the euro-zone,” they said in a research note published Friday. (DSNews)

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Investors Increase Market Share, Especially in Distressed Sector

Investors are making up an increasing share of home purchase transactions, especially in the distressed sector, according to a HousingPulse Tracking Survey released Tuesday by Campbell Surveys and Inside Mortgage Finance.

In October, investor purchases accounted for 22.3 percent of transactions, in keeping with the last three months during which the rate has remained above 20 percent.
At the same time, distressed property transactions grew to take up a larger portion of the market, increasing from 44.4 percent in September to 48.4 percent in October, according to the HousingPulse Distressed Property Index.

Campbell and Inside Mortgage Finance reason that falling prices – especially among distressed properties – combined with rising rents makes purchasing properties to repair and rent a good option for investors.
While residential properties averaged $266,700 in October, damaged REOs averaged $101,100, their lowest price in two years, according to the survey.
About 61.6 percent of properties sold to investors in October will be rented rather than flipped, according to Campbell Surveys’ estimate.
“Renting single family homes is an extremely viable option and seems to be a growing trend in the valley with the decreasing of prices,” a Nevada real estate agent told Campbell Surveys in the recent HousingPulse survey.
A California agent expressed a similar outlook: “[A]t this point renting homes is a better option than flipping because the gap between what an investor can buy a house, fix it and flip it does not cover the cost of re-selling it.”
While investors increase their share of the distressed market, the absorption gap between investors and first-time homebuyers is widening. At 8.8 percent in September, the gap grew to 13.7 percent in October.
(DSNews.com)