Johnny Burke

According to recent data from Relocation.com, the number of people leaving the state is shrinking compared to the number of people moving to it, a crucial gauge for measuring the state's rebound from economic calamity.

As recently as 2005, 60.7% of the relocation activity was outbound- in other words, for every 2 people who were moving, 3 were leaving.

That kind of migration can decimate the local tax base and contribute to a further erosion in the state's quality of life. However, that outbound number has been slowly decreasing every year, from 58.6% in 2006 to 54.99% in 2009 year to date. These numbers are reflected in the Los Angeles data.

We looked at the data for all moves in Los Angeles, including moves made within Los Angeles. We found that outbound Los Angeles moves accounted for 36.4% of all moves in 2009 year to date, down from 43.1% in 2008 (the earliest year for which city data are available).

However, instead of people moving to Los Angeles, we found that more people were making moves within the Los Angeles area, an indication that more people are taking advantage of housing prices to either ‘move up' to a better home, or move to a better neighborhood.

Most importantly, of course, they're deciding not to move out of Los Angeles.

The percentage of movers making a move within LA was 25.2% in 2008; it rose to 32.33% in 2009.

Relocation.com utilizes real-time data from people requesting moving services, recording where people are moving from and to. It annually records over 500,000 moving requests in its database.

On Tuesday, the Senate health committee voted 12-11 in favor of a two-page amendment, courtesy of Republican Tom Coburn which would require all Members of Congress and their staff members to enroll in any new government-run health plan.

Congressman John Fleming has proposed an amendment that would require Congressmen and Senators to take the same health care plan that they would force on us. (Under proposed legislation they are exempt.)

Congressman Fleming is encouraging people to go to his Website and sign his petition. Please be patient though, as this website has been overwhelmed by responses, and rightly so.

Senator Coburn and Congressman Fleming are both physicians. Regardless of your political beliefs, it seems reasonable that Members of Congress should have exactly the same medical coverage that they impose on the rest of us, right?

Legislation Protects Consumers Purchasing Foreclosed Properties

SACRAMENTO, Calif., Oct. 13 /PRNewswire/ -- The Escrow Institute of California announced today that Governor Schwarzenegger signed Assembly Bill 957 into law. This bill, authored by Assembly Member Cathleen Galgiani (D-Tracy), protects consumers by ensuring that they have the right to choose their own real estate service providers when purchasing foreclosed properties.

AB 957, known as the Buyer's Choice Act, prohibits sellers of so-called REO properties - typically foreclosed properties owned by banks - from requiring the buyer to use a particular title company, escrow settlement or other real estate service provider. This unethical, anti-competitive practice drives up costs for homebuyers and takes business away from locally owned companies. The problem has become particularly acute in the Central Valley and Inland Empire, areas that have faced some of the highest foreclosure rates in the country. Recent data indicate that 11 of the nation's top 20 foreclosure rates are in California metropolitan areas.

"Homebuyers should have every right to choose their title, escrow and real estate service providers based on price and quality of service," said Assembly Member Cathleen Galgiani. "AB 957 ensures that buyers can make marketplace choices that suit their own best interests, rather than getting forced to serve the financial interests of some international bank or other corporation."

The Buyer's Choice Act enjoyed overwhelming, bi-partisan support in the Legislature, with State Senator Jeff Denham (R-Merced) providing important assistance. AB 957 was sponsored by the Escrow Institute of California, and received support from the California Association of Realtors and numerous real estate professionals from across the state. The bill requires that REO sellers provide a disclosure notice to buyers informing them of their rights to choose their own title, escrow and other real estate services. Sellers who violate the provisions of AB 957 are subject to enforcement action by state regulators and liable to buyers for civil penalties.

"It's just not right that independent escrow companies and other local real estate businesses are being literally locked out of the foreclosure sales market," said Escrow Institute of California CEO Tim Egan. "These local companies oftentimes offer the best price and highest quality of service available to consumers. Excluding these companies from REO sales kills local jobs and eliminates competition in the marketplace."

For additional information regarding AB 957, please visit www.escrowinstitute.org.

Governor Arnold Schwarzenegger approved seven new laws yesterday that aim to protect Califonia homeowners and homebuyers from mortgage fraud. While this is definitely a step in the right direction, I can't help but wish these laws were in effect years ago. At any rate, this is what the laws are supposed to do:

• Strengthen California's reverse mortgage laws by providing senior homeowners with greater consumer protections when considering reverse mortgage agreements,

• Make it a felony to commit fraud in connection with a mortgage application.

• Promote responsibility and accountability in the real estate market.

"Fraudulent mortgage practices have become more prevalent as a result of the national foreclosure crisis that negatively impacted California's housing market and economy," says Mr. Schwarzenegger. "This legislation helps crack down on abusive lending practices by giving law enforcement the tools to effectively investigate mortgage fraud crimes and provides Californians with greater consumer protections to promote homeownership in a safe and accountable environment."

Specifically, the bills signed are:

• AB260 by Assemblyman Ted Lieu, D-Torrance will enact the Higher-Priced Mortgage Loan Law which would codify a fiduciary duty for mortgage brokers, authorize California's mortgage regulators to apply specified federal mortgage lending laws and regulations to their licensees and cap prepayment penalties and yield spread premiums on higher-priced loans.

SB 36 by Sen. Ron Calderon, D-Montebello to establish standardized licensing requirements for all individual loan originators who offer or negotiate residential mortgages.

• SB 239 by Sen. Fran Pavley, D-Santa Monica to make it a felony to commit fraud in connection with a mortgage application. This bill makes individuals who engage in mortgage fraud guilty of a public offense punishable by imprisonment in the state prison or in a county jail up to one year. The bill also provides law enforcement with the necessary tools to make it easier to obtain a search warrant for real estate records and documents believed to contain evidence of mortgage fraud.

• AB 329 by Assemblyman Mike Feuer, D-Los Angeles to establish the Reverse Mortgage Elder Protection Act of 2009 to provide senior homeowners with greater consumer protections to ensure that they are fully informed about the consequences of entering into a reverse mortgage agreement. Specifically, the bill requires lenders to provide prospective borrowers with a clear and informative written disclosure statement and a written checklist pertaining to the risks and suitability of a reverse mortgage, prior to borrower attending loan counseling.

• SB 237 by Sen. Ron Calderon, D-Montebello to create a registration program for appraisal management companies (AMCs) and prohibits any person or entity from acting in the capacity of an AMC without first obtaining a certificate for registration from the Office of Real Estate Appraisers.

• AB 957 by Assemblywoman Cathleen Galgiani, D-Livingston to mandate that buyers of foreclosed homes would have the choice of using a local escrow office to handle the transaction. It also prohibits a seller of residential property from requiring the buyer to use an escrow service company or purchase title insurance chosen by the seller and would also prohibit a seller of residential property from, without good cause, disapproving the use of a title or escrow company chosen by the buyer.

• AB 1160 by Assemblyman Paul Fong, D-Cupertino to require mortgage loan documents to be translated into the language the verbal negotiations were conducted. Mortgage documents would be translated into Spanish, Chinese, Tagalong, Korean and Vietnamese languages.

NEW YORK (Reuters)

"Short sales," or sales of homes for less than the balance on existing mortgages, are seen as a key way to supplement other efforts such as loan modifications to steady housing.

Unlike most modifications, "short sales" eliminate the problem of negative equity that has become a big reason for defaults as home prices have plunged.

The incentives, first announced in May, would expand the government's Home Affordable Modification Program that has seen limited success in lowering payments for hundreds of thousands of homeowners deemed eligible.

Just 12 percent of homeowners eligible have had their loans reworked, leaving millions more foreclosures to come, the Treasury said on September 9.

More short sales may alleviate fears that a raft of "shadow supply," or foreclosures in the pipeline, will flood the market and deal a blow to the nascent rebound in housing seen over the U.S. summer months, analysts said.

The overhang of supply is currently about 7 million units, or 135 percent of a year's of existing home sales, according to Amherst Securities Group.

"What they are trying to do is move some of these foreclosures in the pipeline, and bring them to a resolution before (foreclosure) happens," said Lisa Marquis Jackson, a vice-president at Irvine, California-based John Burns Real Estate Consulting. "12 percent of these being modified isn't enough to clean these up."

Realtors express frustrations with banks when trying to negotiate a short sale, which can take four to five months to complete, according to John Burns consultants.

Buyers often walk away from sales because banks are slow to respond, or balk at the offer.

The Treasury will use up to $10 billion from a previously announced $50 billion pool of mortgage modification funds for payments to address lender concerns that home prices will continue falling in high-cost areas.

Incentives will be calculated on recent declines of local home prices and average home prices in these markets, the Treasury said in May. They would add to other incentives that servicers can receive for reducing loan payments.

In May, the Treasury proposed lenders would receive a $1,000 payment for allowing the owner to sell the house for less than the amount owed on the mortgage, and accepting the proceeds as full repayment.

They can also receive $1,000 for accepting a similar deed-in-lieu transaction, in which the deed is simply transferred to the lender instead of going through a costly foreclosure.

Borrowers who agree to short sales or deed-in-lieu deals can received up to $1,500 in closing costs.

Treasury also said it will pay second lien holders up to $1,000 to relinquish their claims in such transactions.

"Presumably, the Treasury is trying to help facilitate a transaction that will result in less loss to the lender than in the case of a foreclosure," John Burns consultants said in a research note dated Oct 1 alerting clients of an impending Treasury announcement.