Multi-Party Suit Filed By Homeowners Against Bank of America et al San Francisco Chronicle (press release)
Roseville, California (PRWEB) August 24, 2011
On Wednesday August 17, 2011, United Foreclosure Attorney Network (UFAN) filed suit in Superior Court in Sacramento, CA (case number 34-2011-00109314) on behalf of over 100 homeowners against Bank of America and others alleged by Plaintiffs to be involved in a scheme to defraud and otherwise take advantage of American homeowners.
According to UFAN's managing attorney Kristin Crone, "This is a chance for homeowners to fight for their rights. And, it will be a fight." The complaint details how a vast number of homeowners nationwide are facing mortgage debts far greater than the value of their homes. Some homeowners lost what equity investments they had in their homes when the housing market crashed.
The lawsuit levies blame for the crash of the mortgage market against big banks and mortgage lenders. According to the complaint, between 2000 and present, mortgages were packaged up in pools and the pools were sold to investors. Because a bank could quickly recoup amounts spent issuing mortgages by the sale of these pools of mortgages (otherwise known as Residential Mortgage Backed Securities , or RMBS), the banks incentivized mortgage brokers and lending institutions with high fees for origination (yield spread premiums, origination fees, and discount fees). These fee incentives encouraged the origination of highly predatory loans to individuals who could not afford the loans long term, the complaint alleges.
Keep Your Home California Expands Eligibility and Benefits
Business Wire, Market Watch
SACRAMENTO, Calif., Nov 07, 2011 (BUSINESS WIRE) — California’s program to provide mortgage assistance to homeowners struggling to remain in their homes is making it easier to become eligible for help.
Keep Your Home California, a federally-funded program administered by the California Housing Finance Agency, announced today that it is removing the “cash out” restriction from all four programs and will allow homeowners who own additional properties to qualify for much-needed assistance. Additionally, the length of time unemployed homeowners may receive mortgage assistance has been extended and the amount of money available has been increased.
“This expanded eligibility will allow more families to qualify and receive greater assistance,” said Claudia Cappio, Executive Director of the California Housing Finance Agency. “We are continuously evaluating our experience so far and making adjustments like these based on the initial results of the Keep Your Home California program.”
Keep Your Home California is a $2 billion effort established under the U.S. Treasury’s Hardest Hit Fund to offer mortgage assistance to low and moderate income homeowners who are delinquent or facing imminent default on their mortgage. There are four programs that make up Keep Your Home California, all of which have been developed to address different aspects of the current housing crisis and help homeowners facing financial hardships.
Nearly 8,000 homeowners have benefited or are in process to receive funds from the state-run program, which was fully implemented in February.
The primary changes are:
– Removing the “cash-out” restriction from all four Keep Your Home California programs. Homeowners were previously not eligible for the Principal Reduction Program if they had consummated a cash-out refinance on their home. This exclusion has now been eliminated under all four programs.
...Refinance Help. Fill this form and get help!
FHA Mortgage Loans with Cash Out Refinancing
Nationwide Mortgage Loans provides low rate FHA loans with Cash Out refinancing options for borrowers looking to raise capital and consolidate ...
Refinance a non-recourse loan in california?
Is it true that in california, if I refinance a non-recourse loan (origional first and second mortgages I obtained to purchase a house I currently live in), the loan stays as a non-recourse loan, if I only refinance the balance of the loan, without taking cash out, or adding more things (like car payments) on the loan? Refinanced loan will combine the first and second mortgage into one. What about the closing cost, title insurance, escrow, etc, that will be added on the refinanced loan, does that effect the loan to change from a non-recourse loan to a recourse loan, since more things are added to the orignal loan balance from the first and second mortgage? Will refinance paper work state that it's a non-recourse, or a recourse loan? If it doesn't spell out on the paperwork, how can I be sure that it stays as a non-recourse loan?
Advanced thank you for any answer provided! :)
A non-recourse loan is one where the lender is counting on the collaterall to be worth the loan amount. Correct? So if you refinance both loans, to a different loan program, the non-recourse loan is paid off by the refinance. Simply tell the lender you plan to refinance with that the loan CAN NOT be a non-recourse loan.
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thats who i used last time thay got me a relly good deal
You need to call Frank immediately at 661-635-4900 or 919-802-3119 or 866-728-8587. He can get you financed with his network of over 400 lenders (up to 100%) even with bad credit. He has helped me with 4 properties and it has saved me thousands per month. He also helped me with foreclosures and made me a ton of money. He is an expert in this area.
Which lender in California can I refinance?
I just want to know Which lender is the best which has no any fees, no closing costs, no points, no upfront cost and no hidden cash etc.
How can I tell if my first and second mortgages are non-recourse loans?
Both were purchase money loans made in California at the time we purchased our house (owner-occupied). No cash out and no refinance. I've reviewed the loan docs and cannot find the words "recourse" or "non recourse". What should I be looking for?
In general if your first note is a normal 80/20 and not 100 down no monies then its most likely non-recourse since the 80% equity in the house will cover their loss usually
the second note is probably a recourse loan since they would not bet on having equity to cover the 2nd note
Goz is wrong...No non-recourse means that the loan is not secured...meaning they can't foreclose. All mortgages are recourse loans.
Non-recourse loans are usually bond or mez level loans on commercial paper.
Refinancing in California?
Just wondering what conditions have to be met in order to re-fi? I've been in the house 2 years and owe $400,000. My house is worth about $465,000 (since market went down). I don't want any cash out, just want to take advantage of lower rates right now.
Is there some kind of ratio of equity amount to how much I owe?
I was just told today by a banker that unless my neighborhood housing prices go up (considerbly to over $500,000) that he couldn't help me. do i need to have more equity??
You can go as high as 95% loan to value to answer your one question.
If your going to do it do it now because I'm predicting the rates to go up in Jan.
I'm in Los Angeles so i'm familiar with the area.
Good for you!
how to buy someone out of a house?
my sister and i inherited a home when our father passed away. we refinanced the home to get our names on the title and pulled out some cash for some repairs. and the title is now under three of us (myself, my sister, and my husband). she owns half of the home and my husband and i have 1/3 each. after refinancing and pulling out cash, we now owe 205,000 on the home. it was appraised at about 800,000 last year during the refinance process but was purchased in 1986 by our father.
my question is, in the future, if we plan to buy out my sister's half, how do we do so? do we need to refinance? i cant think of any other way of coming up with that kind of cash or what amount would be considered as the buyout amount. i am concerned if we refinance that the payment will go up to something we cannot afford and we will end up just having to sell the place. we are in california by the way. any help would be appreciated!
Depending on how your sister is fixed financially she might accept monthly payments That would give her a good income for the next 15 to 20 years. While you both are in a good frame of mine is the time to discuss the possibilities. If you cannot come to some kind of agreement, then the house would have to be sold. Remember the longer the three of you hold onto the house the value will increase. Would you be able to pay the taxes on a house appraised at 1 million.
You could sell the house, give her her share and then buy a house you can afford with your share.
How do I overcome lowball bank appraisals to refinance my home? Can I contest an appraisal? Other options?
I purchased my 1950's California home in 2005 for $450k and subsequently sunk $175k into substantial improvements, making the total investment about $625k.
I currently owe $340k on this home and have no other debt.
I was attempting to refinance at a new, low rate, and get some cash out for my business. Yesterday I received a crushing appraisal from one of the bank's selected appraisers. The guy came back with $312k--less than 50% of my investment.
I personally took this appraiser through my home, pointing out all the improvements that had been made and where all the money was spent. I even gave him a breakdown of everything on paper that he took with him. I offered to provide him with before pictures but he wasn't interested.
He admitted in his report that he could not find any recent comparable sales in the area and had to go quite a distance out, into neighborhoods that I would not consider equal. He seems to have based his appraisal purely on the last known sale price of homes of similar age and size, and completely disregarded the $175k in improvements that I'd made to my home.
Obviously, judging a home's value by a recent sale price is flawed. We don't know what the circumstances and conditions of that sale were. Foreclosure, short sale? Judging a home's value by its age and dimensions is equally flawed as we don't know whether that home has been updated in the last 50 years, whether it's completely rotting inside or what.
His report also states that homes in the area have fallen 15-30% since 2005. Now, I would expect a super conservative appraisal to value my home at 70% of my purchase price and improvements at 80% of cost, putting the number closer to $455k. That would have put me at 25/75 LTV, and at least given me a chance to refinance.
Is it worth seeking other financial institutions, and pay another $400 for each additional appraisal? Do you expect my experience will be the same with all appraisers at this time? I've read that banks are encouraging appraisers to return values that represent an amount where at it would be impossible for a bank to lose money on the property in a foreclosure... roughly 60% of actual value.
Is it worth attempting to find independent appraisers and contest the bank's appraisal? Is there anything I can do to force a bank appraiser to value my improvements, or just value my home higher in general?
Do I have any other options? I'd really like to refinance while rates are amazing, and I'd love to get cash out or as part of a HELOC for my business.
Rhetorical question/rant: why would people want to avoid foreclosure when their homes are being appraised at 50% of value? How many years does it take to get a foreclosure off your record? How many years will it take you to earn that $300k that your home just lost in value?
You can not force the appraiser to value the improvements, they are NEVER part of the appraisal. The only thing you can do is try to force a change in the listed condition. If it went from from "poor" to "good" you appraise higher.
You can not force the bank to use any other appraiser then the one they have hired. It is their money.
As for your rhetorical question, it is because they borrowed MONEY. Cash money. Refusing to repay it does not make it a gift. They still owe a huge chunk after a foreclosure.
If you are unhappy with this bank you can try another, but your appraisal should not vary by much. They all use the same criteria.
The main value in a home is it's exact location. The improvements do matter but often they do not matter very much. It could be that they may not add anything to your value but it is more common that they add maybe 50% to 60% of the cost involved.
If there are no sales close by then the appraiser had to make some huge judgment calls. He should be able to determine the details of each sale and should be able to tell you what he found, but you will not likely change his mind about the value.
If you paid for a second appraiser the value would be different. I bet the more experienced appraisers would do a better job in finding good comparables and in making those necessary judgment calls.
Banks want to make loans, that is the way they make money. They may be very scared to do cash out loans though and that may be why the bank is not helping you argue your case.
2. You hit the nail on the head with your rant. Any homeowner who is bending over backwards to avoid foreclosure when the mortgage is 50% underwater is a complete idiot. This is particularly true in places like California, where most every homeowner has the option of walking away with no further financial liability other than what has already been paid towards the mortgage. Of course, there are not a hell of a lot of true "idiots" in this world. The result is that all of these save-the-homeowner programs that local politicians are pushing are falling on deaf ears, because only a true idiot, which are few and far between, would continue making full price payments for something that has already lost half its value.
There are different ways to appraise a home. One is comps, which doesn't seem to lend itself to you situation. Another is cost. This is how he should have appraised your home. Lets say you home is 1,000 square feet, it costs a $100 a square feet to build in that area for that type of home. If your home was new it would appraise for $100,000 plus the land. Your upgrades could come into play, so could the appeal of the home but all of that is subjective. Now that we have determined a price they have to figure in the age of the home, the condition of the home and the CURRENT MARKET, CURRENT MARKET which if it is bad will BRING DOWN THE VALUE of the home. Just because you put $$$$$$ into the home doesn't automatically increase the value.
Costs and value are different. The only time you can actually count on $ and effort being put into a home and making an actual profit is cleaning and paint. Elbow grease (20 bucks worth of cleaner) and a couple gallons of paint (100 bucks worth of paint) go a L O N G way in any market.
All real estate is local, and I can't speak for your area. But let me try to address some of your points, at least in general.
You say: "He seems to have based his appraisal purely on the last known sale price of homes of similar age and size, and completely disregarded the $175k in improvements that I'd made to my home."
ANSWER: Yes. Appraisers base an appraisal on recent home sales of "comparable" homes, generally described as homes in the same community or nearby, similar size, and when possible similar age. That's what they do.
Regarding your $175,000 in improvements, you didn't describe what they were. If they involved, let's say, adding living space (a room, a bath, bumping out the kitchen, etc.), then that should be reflected in the appraisal. However, if the improvements involved replacing laminate countertops with granite, replacing the vinyl entryway flooring with marble, etc., That adds comparatively little value from an appraisal standpoint.
You say: "Obviously, judging a home's value by a recent sale price is flawed. We don't know what the circumstances and conditions of that sale were. Foreclosure, short sale? Judging a home's value by its age and dimensions is equally flawed as we don't know whether that home has been updated in the last 50 years, whether it's completely rotting inside or what."
ANSWER: There's some debate about whether the conditions of the sale should matter. Many appraisers--and I agree with them--say it shouldn't matter. Look at it this way: A community has 10 homes for sale. Five are foreclosures or short sales, priced around $325,000. The other five aren't distress situations, and they're priced around $650,000. A buyer is interested in purchasing a home in the community. Which ones is the buyer going to look at? And which one is the buyer likely to purchase? The cheaper homes. And if those cheaper homes are comparable to the higher-priced ones (size, age, condition), then the cheaper homes will dictate the appraisers analysis.
You say: "His report also states that homes in the area have fallen 15-30% since 2005. Now, I would expect a super conservative appraisal to value my home at 70% of my purchase price and improvements at 80% of cost, putting the number closer to $455k."
ANSWER: The appraiser would know how much home values have fallen. 15%-30% is a broad range, but it's not a suprising range. I can show you areas about 25 miles from Washington, D.C. (a comparatively stable area financially) where prices have fallen by 70%. (Manassas, Woodbridge, some areas of Reston.) Even closer in, about 10 miles outside of Washington, I can show you areas where prices have fallen by 40% (areas of Falls Church and Fairfax).
Again, prices are extremely locally-based. But my point is that it doesn't surprise me to hear an appraiser say that prices have fallen by 30% since the peak of the real estate market.
As for the value of your improvements, as I noted, if it involved adding square footage of livable space to your home, then it'll return some value. If it involved upgrading what was already there, it'll return far less. Most of the figures I see (and this applies to value for resale) are in the 40%-60% return range. Sometimes it's higher--adding a second bathroom to a home that only has one, for instance. But that's unusual.
You write: "I've read that banks are encouraging appraisers to return values that represent an amount where at it would be impossible for a bank to lose money on the property in a foreclosure... roughly 60% of actual value."
ANSWER: Yes and no. Yes: Banks are encouraging appaisers to return very conservative values. Absolutely. But, as another answer points out, that still should be 100% of value. What you may have read may have said that banks will lend only 60% of the appraised value. That's the way they'd protect themselves in the event of a foreclosure.
Like I said, the appraisal you had might have been too conservative. But it's probably not off as much as you think.
What you might do is ask a good Realtor to do a CMA on your property. Now, that's not the same as an appraisal. But that'll give you another perspective and another number. And the CMA will be free.
Hope that helps.
All appraisals are for market value (what a typical buyer would pay). All appraisals must be supported by market data, facts and stand up in a court of law. Your option has no bearing on the appraisal. What you paid has no bearing on the appraisal. 2005 when you bought was the height of the market. Homes are not being appraised for 50% of value, homes are being appraised for current market value and because you owe more than it market value is not the appraisers fault.
Appraisers are required for follow USPAP mandated by federal law. Appraisers also have to follow lender guide lines like, 2 comparables must have sold within 90 days , no comparables may be used that have sold prior to 6 months, all comparables must be within one mile of the subject. Comparables should bracket the subject in square footage (some larger and some smaller). Line adjustments can not exceed 10% of the comparables sales price. Net and gross adjustments should not exceed 15%, the list goes on and on.
Not sure where you are coming up with return of 80% on improvements? My neighbor put a $30K roof on her house and I put a $8,000 roof on, both roofs added zero value to our homes, it maintenance that has to be done to keep your home at current value. I have a 50' x 20' deck with a hot tub, cost around $20K on an appraisal the return is around 5K.
Quote: I've read that banks are encouraging appraisers to return values that represent an amount where at it would be impossible for a bank to lose money on the property in a foreclosure... roughly 60% of actual value.
Fact Banks can not encourage an in anyway to increase the value or decrease the value (this is federal law) and a appraiser could lose his license and do jail time for doing it. This would be called a missleading report and I have NEVER and I mean NEVER heard of a lender telling the appraiser to under appraiser a home. That makes no since. The lender wants to make loans, and they make no money if they don't. They just dont want to loan more money than the home is worth.
Fact: The appraiser could care less what you think your home is worth and that not his job. His job is to appraise your home for market value.
Fact: Most homeowner think their home is
worth more than it really is.
Quote: He seems to have based his appraisal purely on the last known sale price of homes of similar age and size, and completely disregarded the $175k in improvements that I'd made to my home.
He should be using homes of similar age and size. It sound like you have over improved your home for the neighborhood.
Quote: We don't know what the circumstances and conditions of that sale were. Foreclosure, short sale? Judging a home's value by its age and dimensions is equally flawed as we don't know whether that home has been updated in the last 50 years, whether it's completely rotting inside or what.
Fact: appraiser would not use a foreclosure or a short sale as that would not be a arm' length transaction and would not be used. The appraiser does know if the comparables have been updated as MLS photos shows interior of the comparables and notes states this.
Sorry but it is what it is.
Ethics aside, what is keeping me from walking away from my home in California?
I bought a home in a shitty neighborhood in Northern California 3 years ago for $460,000.
I owe $373,000 on it now.
My house just appraised for $250,000.
I had a baby in 2007. My outlook on life has TOTALLY changed. I'm now thinking "oh God, there is NO way I want to send him to the public schools around here or have him grow up witnessing the way people around here act and talk in public. (lowwwww claaass, THE definition of it, trust me)
I cannot refinance and my mortgage company said they are not willing to adjust my loan because I make too much money and have no credit card debt and no car payments (yeah, im totally bragging for those of you who sit on yahoo answers reading questions all day trying to come up with clever put downs).
My credit score is 790, I have NEVER EVER missed a payment in my life, we have mortgage protection, life insurance, everything we need to cover our ass if we can't make our mortgage payments.
I have enough cash to put down on a HUGE house in a BEAUUUTIFUL neighborhood. My mortgage payment would be $1,000 LESS than the crappy house i'm in now, I would be able to send my son to a public school in the area and I wouldn't be surrounded by "ghetto-ness"... yes, that's a word... lol. If you lived here, you would SO know what I mean. I was only 22 when I bought the house... that should explain everything.. Woooops, im human, i made a mistake... but its ALL i could afford at the time.
My father-in-law has offered to use his credit and our cash to put us in the house of our dreams. He already owns his house, all the investment properties he wants, a retirement home, a vacation home, has a sh*t load of cash, so he wont necessarily "neeed" his credit any time soon. We would only be "using" his credit for 2-7 years until we can assume the loan. I heard you are eligible to apply for a new home loan in 2 years now that foreclosures are "the in thing" lol... but i dont trust much of what I hear on the streets so i'm going to say "2-7 years."
MY QUESTION for any tax consultants, mortgage professionals, lawyers, anyone out there who can help with USEFUL information, etc..
what are the down sides to this?
Retarded comments/worthless information will be disregarded.
THAAAAANK YOUUUUUUUUU : )
Home insurance is actually very flexible. I'm not sure about California regulations, so I recommend you call a nearby home insurance agent. http://www.goodinternetdeals.com/Home-Insurance.html They will be able to assist you.
1. Kiss your great credit goodbye, for who knows how long. Your score will drop a minimum of 150 points.
2. Since you have a good income, what would stop the banks from coming after you for the balance owed on the home? Once your $373,000 mortgaged house goes through foreclosure, the bank will add: foreclosure fees, taxes, real estate commission, loss on sale, legal fees, upkeep fees, etc. etc. Your $373,000 debt would quickly balloon and the banks are not selling foreclosures quickly. You think the house is now worth $250k, do you think it would sell for that? All of a sudden, instead fo a $123k shortage, you would be looking at close to $200k on a house you no longer own.
3. The banks, now owned by the government, will start coming after those people that walked away that still have jobs. They will have to because truly the government owns them now and they need to make Uncle Sam happy to keep the gravy train rolling.
I'm sorry you are in the situation you are in, but investments-even houses-are not guaranteed.
Good luck.
Moving along to the NEXT scenario. if you use Daddy's credit to obtain a different mortgage, you will not be able to use any of the mortgage interest paid as a tax deduction. Why ? Because, in order to take such a deduction, you must be the listed borrower(s) on the mortgage. Form 1098, listing all the interest paid, will be sent to Daddy. The IRS won't be pleased if you try to take that deduction when it's not in your name.
Refinancing a home when you live in India now?
I rent a home in California and the owners now live in India, they came back a few weeks ago to look at house..and today there was an appraiser that came by to look at the house..the owners stated they were not comming back to the states to live..so my question is how can a homeowner refinace their home when they don't even live here anymore..so is it okay to pull out the cash and live on it outside this country...too me this just shows how easy it is to screw over our system.
Home Loan (Refinancing option)??
I am buying a home in Fresno California. I am 34 years old. My house is in my parents name due to my credit. I have been buying the home for thirteen years and owe appr. $50, 000. I am late in payments as many people in the U.S. are. The loan is with Wells Fargo. I would like to approach my parents with a/some suggestions as to how we can refinance, take out on the equity, etc. Something to assist with catching up, having some cash for renovations, etc. Any suggestions?
Taking out a home equity loan in your situation is a very dangerous thing to do. You cant use the home equity loan to help catch up, that's eating yourself up from the inside out. Its just like maxing out your credit cards. Using it to renovate is probably not a good thing either. Many other homeowners used their home equity loan to renovate, and dont know how much to renovate. Many of them overbuild and the new renovations didnt add any new value. If you say you have equity then sell the place, because you cant afford it anyways, and you dont want to hurt your parents credit. Getting a home equity loan will just raise your payments, and it is not nearly enough money to cover yourself for very long. If your credit is better now, maybe you can refinance your original loan and try to get an affordable fixed rate. If you cant, there isnt many options for you. If you take the home equity loan route, you will follow the same path of many homeowners who cant afford to repay the loan and are now foreclosed on. Its just very irresponsible. Sell the place, dont look back, and start over.
Mortgage buyout inquiry?
Three people own a home -- all are on the mortgage -- one of those persons is giving X amount of dollars to buyout the other two. He will be giving cash. He does not want to refinance. The other two people want off the mortgage, because they'll be buying another house in another state. (The present home is in California.) Who does a new deed? Should I consult with a real estate attorney (if there is such a thing)? Any insight would be appreciated.
The problem with this scenario is the "He does not want to refinance."
If he does not refinance the other two people will STILL be legally responsible for the loan no matter what the deed says. This will not only include if he doe snot make the mortgage payments, but will show up as their debt when attempting to buy another house.
The other two would be wise to refuse to sign anything until AFTER the refinancing was completed.
A title company will help you with the paperwork required and assure that Mr Cash does not screw the other two over (which is exactly what he is attempting to do).
california cash out refinance - News
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10-Q: INTEGRATED HEALTHCARE HOLDINGS INC The nondetachable conversion feature of the $10.7 million Convertible Term Note is out-of-the-money on the Effective Date. Pursuant to EITF 05-2, |
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Will copper recover sooner than people think? - Mineweb Will copper recover sooner than people think? The company also closed out its put options - or options to sell copper at a set price - which enabled the firm to raise $11.6 million in cash. |
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(FED) Stabilizing the Housing Market: Focus on Communities - Forex Hound (FED) Stabilizing the Housing Market: Focus on Communities Had house prices continued to rise, many borrowers would have been able to refinance to avoid higher payments and perhaps to extract accumulated home equity |
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It's tough, but still possible, to refinance If you refinanced your original mortgage to take out cash, bought your home without a down payment, obtained an interest-only or payment-option mortgage, |
Run the Refinancing Numbers, Then Run Them Again - Atlanta Journal Constitution
Richmond Times DispatchRun the Refinancing Numbers, Then Run Them Again Other people want to get out of riskier loans, like adjustable-rate mortgages. Or, you may want to take cash out of your home — that is, if you have enough Erik S. Lesser for The New York Times To refinance or not to refinance. THAT is the question.
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