5 Things Your Landlord Won’t Tell You

5 Things Your Landlord Won’t Tell You

By Kelli B. Grant , SmartMoney.com

Dec 8, 2010 Provided by: Shareretweet

1). “This building is in foreclosure.”
In late 2009, Melody Thompson called her landlords to ask about the well-dressed picture-takers outside her four-bedroom Portland rental home. “Oh, we’re refinancing,” she remembers them telling her. Then in late April, a formal bank notification arrived in the mail, stating that the home was in foreclosure and would be put up for sale in late August. “I was immediately angry,” says Thompson, the executive director of Financial Beginnings, a financial literacy nonprofit. “They lied.” The sale has been postponed twice as the landlords apply for a mortgage adjustment, but Thompson is still hunting for a new place.

Renters accounted for 40% of families facing eviction from foreclosure in 2009, according to the National Low Income Housing Coalition. And unfortunately, they often hear about it as Thompson did — from the bank, just weeks before the sale, says Janet Portman, an attorney and the managing editor of legal book publisher Nolo. “The landlord wants the tenant in there, paying rent,” she says. The lack of notice was so pervasive that last year Congress passed the Protecting Tenants at Foreclosure Act, which gives tenants at least 90 days from the foreclosure sale to move out. (Previously, they had as few as 30 days, Portman says.) Provided the new owner doesn’t want to live there, the law also lets legitimate tenants — those who signed a lease before the sale and pay a market value rent, among other qualifications — stay through the end of their lease.

2) “You should complain more.”
When a steady drip, drip, drip of water from the ceiling led a third-floor tenant to complain, Adam Jernow, a principal at property management firm OGI Management in New York City, assumed they were dealing with a leaky pipe. It wasn’t until a week later, when the tenants on the top floor two flights above that apartment finally called, that he realized they were dealing with a big roof leak from heavy summer rains. Had upper-floor tenants complained sooner, Jernow says, they could have limited the damage, and that third-floor tenant might not have had a problem at all. So while renters often assume quirks like hot-then-not showers or moisture on the walls is just part of big-city living – or that complaining to the landlord will just open up a can of worms – keeping a property owner informed can actually help a problem get fixed faster. Besides, most states require landlords to keep the property in good repair, with home systems and appliances in working order.

3) “There’s more to negotiate than the rent.”
Rental markets in many cities around the country have improved this year, which means landlords have less incentive to cut you a break. Just 31% of landlords lowered rent in 2010, versus 69% in 2009, according to property marketplace Rent.com. All the major real estate investment groups are asking for higher rent on new leases, and about half are doing so on renewals, says Peggy Abkemeier, the president of Rent.com.

But the market hasn’t improved so much that landlords don’t have incentive to keep good tenants, she says. The survey found that 44% of landlords are willing to lower security deposits, and 22% will offer an upgrade to a fancier unit (think better views, quieter neighbors, newer kitchen) without raising rent. And there’s still that 31% of landlords who will offer a price break. “It never hurts to ask,” Abkemeier says. In markets where vacancy rates are still high, such as Atlanta, Las Vegas, Orlando and Phoenix, tenants have a better chance.

For the last 2 items… Click Here to go to original story.

More than one in five homeowners underwater: Zillow

Ok, first things first. I am not a fan of Zillow. Zillow is consistently criticized for taking a biased approach for valuations. It is reticent to sticking your toe into the Atlantic Ocean off Daytona Beach, FL to get the temperature in the Atlantic Ocean off New England… Sometimes the market moves to fast to take its correct temperature.

Ok, now with that preface out of the way, the article reads like this.

Home values in the United States extended their fall in the first quarter, with more than one in five homeowners now owing more on their mortgages than their homes are worth, real estate website Zillow.com said on Wednesday.

U.S. home values posted a year-over-year decline of 14.2 percent to a Zillow Home Value Index of $182,378, resulting in a total 21.8 percent drop since the market peaked in 2006, according to Zillow’s first-quarter Real Estate Market Reports, which encompass 161 metropolitan areas and cover the value changes in all homes, not just homes that have recently sold.

U.S. homes lost $704 billion in value during the first quarter and have depreciated $3.8 trillion in the past 12 months, according to analysis of the reports.

Declining home values left 21.9 percent of all American homeowners with negative equity by the end of the first quarter, Zillow said.

By comparison, 17.6 percent of all homeowners owed more on their mortgage than their property was worth in the fourth quarter of 2008, and 14.3 percent were underwater in the third quarter of last year, the reports showed.

Nine consecutive quarters of declines have left eight regions — including the Modesto, California, Stockton, California, and Fort Myers, Florida regions — with median value declines of more than 50 percent since those markets peaked.

In 85 of the 161 markets covered in the report, the annualized change over the past five years is negative or flat, the reports showed.

For the full article and continued depressing carnage... Click Here <—-

An Effort to Save a City by Shrinking It

What a terrific idea! I would think that this approach could be successful in different scales in many areas where populations have dried up along with jobs and hope.

Certain parts of cleveland would look better, be safer and more enjoyable if the houses were gone and parks and open space existed instead.

Below find the beginning of the article and the full story is provided in the link found here and below the story.

FLINT, Mich. — Dozens of proposals have been floated over the years to slow this city’s endless decline. Now another idea is gaining support: speed it up.

Instead of waiting for houses to become abandoned and then pulling them down, local leaders are talking about demolishing entire blocks and even whole neighborhoods.

The population would be condensed into a few viable areas. So would stores and services. A city built to manufacture cars would be returned in large measure to the forest primeval.

“Decline in Flint is like gravity, a fact of life,” said Dan Kildee, the Genesee County treasurer and chief spokesman for the movement to shrink Flint. “We need to control it instead of letting it control us.”

The recession in Flint, as in many old-line manufacturing cities, is quickly making a bad situation worse. Firefighters and police officers are being laid off as the city struggles with a $15 million budget deficit. Many public schools are likely to be closed.

“A lot of people remember the past, when we were a successful city that others looked to as a model, and they hope. But you can’t base government policy on hope,” said Jim Ananich, president of the Flint City Council. “We have to do something drastic.”

In searching for a way out, Flint is becoming a model for a different era.

Planned shrinkage became a workable concept in Michigan a few years ago, when the state changed its laws regarding properties foreclosed for delinquent taxes. Before, these buildings and land tended to become mired in legal limbo, contributing to blight. Now they quickly become the domain of county land banks, giving communities a powerful tool for change.

LINK TO FULL STORY <——

The Making of a Landlord

I saw the story’s title and was instantly drawn to it. A wonderful, realistic read. I hope you enjoy as much as I do.

“The Landlord of the Shadows”

written By Christopher Palmeri s a senior correspondent in BusinessWeek’s Los Angeles bureau.

I was chased by a wild dog.

I saw a home so stripped someone had even taken the front door. I attended a foreclosed-home auction that featured cheerleaders yelling in my ear. Finally, in March, I closed on a home I’m now renting out as an investment property.

I paid $125,000; it had sold for $345,000 four years ago.
In my one-year search, I came to expect surprises and to realize that even a good credit score doesn’t get you far.

One thing I learned: Avoid foreclosure auctions. The homes need lots of work, and most buyers don’t have time to do proper inspections. Ditto for “short sales,” where an owner tries to sell a home for less than what he owes the bank. There are too many decision-makers involved. I made an offer on a short sale. Nine months later it’s still on the market.

I began my search in my Los Angeles neighborhood, but even with a big down payment, prices hadn’t fallen enough to produce positive cash flow for a rental property. So I searched Realtor.com for homes in suburbs a train ride away that seemed likely to have job growth. I found a two-bedroom, one-bath Spanish-style bungalow listed for $129,000 in Ontario, Calif. I offered $123,000; we settled on $125,000.

I figured getting a loan would be easy. I have good credit, no debt, cash in the bank, and a job. I was pre-approved for hundreds of thousands of dollars. Bank of the West wanted to charge me five points — a $5,000 fee to borrow $100,000. Says a bank spokesman: “Higher points for an investment property reflect the higher risk on that mortgage.” A rep at a major national bank said it wasn’t “competitive at loans under $100,000.” LendingTree.com promised to find me five offers in 48 hours. Two days later it said it couldn’t help.

Ultimately, an independent broker, Los Angeles’ Legend Mortgage, found me a loan with an institution I had never heard of, Burlingame (Calif.)-based Provident Funding Associates. I had to put down more than planned: 25%. And I’m paying 6.2% and one point in fees, more than the 5%, without points, I would have paid if the house were to be owner-occupied.

Provident put me through the wringer. Bank statements, tax returns, notarized interspousal escrow instructions. At one point, I was scraping and painting a house I didn’t own because the lender wanted damage repaired. I was out about $1,000 for inspections and other work before I was even sure I was going to get the loan.

The bank that owned the property wasn’t much fun, either. With such properties, banks offer a tight window for you to cancel your purchase based on inspections — seven days, in my case. And the bank wanted me to pay $100 a day if I didn’t close on the agreed day. This led to stress — and requests for waivers — on my end. On the bright side, bank-owned properties commonly sell “as is,” but with mine the bank paid more than $5,000 for a new sewer line, termite abatement, and other repairs.

Then it was time to rent it. I checked similar properties on Craigslist, then underpriced the rent at $1,100 a month to get a tenant fast. I had 16 interested parties in a few days. Some of the stories were heartbreaking — families living in cramped apartments and on food stamps just wanting a house for their kids. I showed it to two people and took an application from one, verifying employment and paying $30 to MySmartMove.com to check his credit.

In the end, my total cash investment was $47,000. Payments — taxes, insurance, everything — will be $750 a month (plus any repairs). If my tenant pays me for a year, I’ll get a 9% return, not including tax advantages or price appreciation.

If being a landlord is a hassle, the hope of a 9% return will ease the pain.

We wish you the best of luck Mr. Palmieri, the best of luck!

Boston’s John Hancock Tower, New England’s tallest building, was sold Tuesday in a foreclosure auction held by an investor group for $660.6 million, half the price paid by real-estate private-equity firm Broadway Partners three years ago

Boston’s John Hancock Tower, New England’s tallest building, was sold Tuesday in a foreclosure auction held by an investor group for $660.6 million, half the price paid by real-estate private-equity firm Broadway Partners three years ago.

Original post & story By — Email LINGLING WEI

The winning bidder was a partnership between Normandy Real Estate Partners and Five Mile Capital Partners, which holds the senior portion of $700 million in so-called mezzanine debt, or the part that fills the gap between the first mortgage and a borrower’s equity. The partnership agreed to pay $20.1 million for the mezzanine debt and assume the first mortgage of $640.5 million. The Normandy-Five Mile team has bought pieces of the mezzanine debt at discounted prices since June 2008. The debt was originally made by Greenwich Capital, which is part of Royal Bank of Scotland Group PLC, and Lehman Brothers Holdings Inc.

The auction, which some participants described as a “non-event” and lasted only a few minutes, reflects a steep decline in commercial-property values as the economic distress sweeps through office buildings, shopping malls, hotels and the like. The investor group moved to conduct the foreclosure auction after Broadway defaulted on the mezzanine loan, which came due in early January.

Unless other creditors or Broadway Partners go to court to try to block the foreclosure, the Normandy-Five Mile partnership will take over the building immediately. People familiar with the matter said a court fight is “highly unlikely.”

The Normandy-Five Mile partnership also won the bidding for one other office tower controlled by Broadway Partners in Southern California, called 10 Universal City Plaza near Los Angeles. Their winning offer was about $304.9 million.

For full article and other commercial news, visit WSJ, here <—-

How to stall a Foreclosure “Produce the Note” video

Facing foreclosure? Info at http://www.consumerwarningnetwork.com may help. Your goal is to make certain the institution suing you is, in fact, the owner of the note. There is only one original note for your mortgage that has your signature on it. One such case is profiled on CNN’s Your Money.
The 3 videos below are all different stories, but offer similar advice…

Barack Obama announces Homeowner Stability and Affordability Plan

On February 18, 2009, President Obama announced his Homeowner Affordability and Stability Plan, designed to help up to 7-9 million families avoid foreclosure by restructuring or refinancing their mortgages.

This plan aims to assist homeowners who have maintained payments and are making earnest attempts to continue along the path. Rather then try to help a boater after they have fallen into the raging waters, this aims to give them a lifejacket and stabilize the boat beforehand.

The 3 main components of the plan, via http://realtor.org are as follows:

1. Government Sponsored Enterprises (GSEs) Refinancing for Up to 4 to 5 Million Responsible Homeowners with GSE loans to Make Their Mortgages More Affordable

2. A $75 Billion Homeowner Stability Initiative to Reach Up to 3 to 4 Million At-Risk Homeowners

3. Supporting Low Mortgage Rates By Strengthening Confidence in Fannie Mae and Freddie Mac

For a chart breakdown, visit this link.

Obama to Unveil $75 Billion Mortgage Plan

One day after signing a $787 billion stimulus bill into law, President Barack Obama will outline a $75 billion plan to help stem foreclosures, which is at the heart of the nation’s deepening economic woes.

Johnny Cash – God\'s Gonna Cut you Down

The goal will be to prevent millions of American families from losing their homes because they can’t make mortgage payments.

“All of us are paying a price for this home mortgage crisis,” Mr. Obama will say of the plan, according to prepared text of remarks released to the Associated Press.

The plan, called the

Homeowner Stability Initiative

, would provide incentives to lenders to cut monthly mortgage payments to sustainable levels. It defines this at no more than 31 percent of homeowners’ income.

Mr. Obama will outline the plan Wednesday at a high school in Mesa, Ariz., one of the states hardest hit by mortgage defaults.

More than 2 million American homeowners faced foreclosure proceedings last year, and that number could reach as high as 10 million in the coming years depending on the severity of the recession, according to a report last month by Credit Suisse.

“In the end, all of us are paying a price for this home mortgage crisis. And all of us will pay an even steeper price if we allow this crisis to deepen,” Mr. Obama plans to say.

The plan will include several elements, reported the Washington Post.

It will encourage lenders to lower borrowers’ payments to affordable levels, perhaps through the government subsidizing lower interest rates. It also will establish industry standards for modifying troubled loans, which could include extending the terms of loans or giving borrowers a short-term break on payments.

Homeowners would also be allowed to refinance their mortgages if they owe more than their homes are valued, reported the AP, and bankruptcy judges would be given more authority to change mortgages.

An official, speaking on the condition of anonymity, also told the AP that the Obama administration will use Fannie Mae and Freddie Mac to help prevent borrowers from defaulting on their mortgages.

The administration, reported the Washington Post, also focused on developing a plan that would not put too much taxpayer money at stake, supplanting previous government foreclosure prevention efforts that have fallen short.

As part of the housing rescue plan the Treasury Department would double its financial support for housing finance giants Fannie Mae and Freddie Mac, allowing them to play a bigger role supporting housing as part of a fresh foreclosure mitigation plan, according to Reuters.

The Treasury said it was increasing its preferred stock purchase agreements with the two government-controlled companies to $200 billion each from $100 billion. It also said it was raising the limit on the size of the mortgage portfolios the two companies can hold by $50 billion to $900 billion each, along with a corresponding increase in their allowable debt outstanding.

This story compiled from numerous sources on the web.
via original content – http://PBS.com

The Foreclosure Identity…starring Banks and How they are making things Worse!

The bad mortgages that got the current financial crisis started have produced a terrifying wave of home foreclosures. Unless the foreclosure surge eases, even the most extravagant federal stimulus spending won’t spur an economic recovery.

The Obama Administration is expected within the next few weeks to announce an initiative of $50 billion or more to help strapped homeowners. But with 1 million residences having fallen into foreclosure since 2006, and an additional 5.9 million expected over the next four years, the Obama plan — whatever its details — can’t possibly do the job by itself. Lenders and investors will have to acknowledge huge losses and figure out how to keep recession-wracked borrowers making at least some monthly payments.

So far the industry hasn’t shown that kind of foresight. One reason foreclosures are so rampant is that banks and their advocates in Washington have delayed, diluted, and obstructed attempts to address the problem. Industry lobbyists are still at it today, working overtime to whittle down legislation backed by President Obama that would give bankruptcy courts the authority to shrink mortgage debt. Lobbyists say they will fight to restrict the types of loans the bankruptcy proposal covers and new powers granted to judges.

The industry strategy all along has been to buy time and thwart regulation, financial-services lobbyists tell BusinessWeek . “We were like the Dutch boy with his finger in the dike,” says one business advocate who, like several colleagues, insists on anonymity, fearing career damage. Some admit that, in retrospect, their clients, which include Bank of America (NYSE:BAC – News), Citigroup (NYSE:C – News), and JPMorgan Chase (NYSE:JPM – News), would have been better off had they agreed two years ago to address foreclosures systematically rather than pin their hopes on an unlikely housing rebound.

For full article, visit this link… http://news.yahoo.com/s/bw/20090213/bs_bw/0908b4120034085635;_ylt=AtWsJftLkHmVUS64jGxOxMayBhIF

Hey Charlie Brown, we want to hold the football for you!

Mortgage finance company Freddie Mac said it will allow some borrowers to rent out their homes after losing them to foreclosure.

The goal of the new policy, announced Friday, is to prevent properties from becoming vacant so they won’t fall into disrepair.

Freddie Mac also said it will allow renters to remain in their homes even if their landlord enters foreclosure. The McLean, Va.-based company currently has about 8,500 properties in the foreclosure process, but many of those are vacant.

“Keeping foreclosed properties occupied and in better repair will support local property values and promote a faster recovery in the housing market,” said Freddie Mac Chief Executive David Moffett.

Fannie Mae, which announced similar plans earlier this month, said it has stopped about 20,000 foreclosure sales and halted 6,300 evictions of owners or renters this winter. Under Freddie Mac’s new policy, tenants and former property owners need to demonstrate that they have enough income to pay the rental bill.

Freddie Mac also said it would consider reinstating a mortgage for those borrowers who can qualify for a modified loan. Washington-based Fannie Mae and Freddie Mac were taken over by the government in September after mounting mortgage losses put them in distress that was a prelude to the broader financial crisis that hit Wall Street last year.

Both Fannie Mae and Freddie Mac also said Friday they would extend a previously announced suspension of evictions through the end of February. Fannie and Freddie combined own or guarantee about half of the $10.6 trillion in outstanding U.S. home loan debt.

I LOVE IT WHEN A PLAN COMES TOGETHER!!!

Personally, I find this story to be kind of pointless. I am sure the folks it has affected directly who stay in their homes and rent them feel differently, but alas, why not conclude that if they are income suffiecient to stay on and rent for a certain amount, why not work to find terms to achieve the same thing on a loan for purchase, whether through modification or refinancing. I can see the small benefit to communities and Fannie and Freddie, but I also see a lot of needless angst, stress and paperwork. Maybe I am in a bad mood when I write this, because a little part of me, feels like I am just playing Devils Advocate here and I also want to believe that this is a great idea!