Monique Carrabba

Millions of delinquent mortgages have been frozen in a kind of limbo for some time now. Their servicers are unable or unwilling to take definite action, for a variety of reasons. But there are signs that the ice may be beginning to break. Consider the following:

• As part of its settlement with investors announced in June, Bank of America has agreed to release certain high-risk loans to subservicers, and to pay additional fees to investors if servicing timelines are not met.
• Bank of America has also announced plans to sell off a portion of its servicing portfolio.
• A July 22 article in DSNews describes a proposal now being considered by the U.S. Treasury to allow some securitized loans to be sold at a discount to new investors.

What does all this mean? Simply, loan servicers may now be free to act much more swiftly to resolve their defaulted loans.

The big servicers and—their investors—have been paralyzed not only by the volume of delinquencies, but by their own pooling and servicing agreements, which strictly limit their activities. New servicers will not be shackled by those agreements, and unlike the original servicers, will likely be equipped to handle just such problem loans.

New investors will also be inclined to move quickly toward resolution; having purchased the loans at a discount, they’ll have nothing to lose by disposing of them, by modification, short sale, or foreclosure.

This could be good news for the entire industry—but especially for those in the trenches trying to help homeowners resolve their troubles, one way or another.

http://www.dsnews.com/articles/regulators-considering-new-housing-policies-2011-07-22

I know Equator is efficient but sometimes it's nice to have someone else on the phone rather than a program where you never really speak to a human on the other hand. Equator organizes the tasks and process of a short sale.

Isn't organized in managing loss mitigation but it misses a more human component when negotiating short sales. Today I received a message below that Wells Fargo is going live with Equator.

Love it? Hate it?

July 15, 2011

Dear MONIQUE CARRABBA:

We're following up to see if you've had the opportunity to simplify the short sale process for your Wells Fargo properties by using the Equator platform.

Take advantage of the automated process

Now that we're part of the Equator network, we encourage you to use this platform to help you initiate, manage and process any short sale transactions for Wells Fargo Home Mortgage properties.

As a reminder, Equator is available at any time to help you:

Initiate the short sale process - with a few steps, initiating the sale is easy
Check the file status of your short sales - to stay on top of tasks and on target with deliverables
Upload documents - to easily verify documents have been submitted
Access the workflow of requested items for short sales - to readily know the items still needed

The following types of loan will be accepted through the system for your Wells Fargo short sale properties:

Wells Fargo Home Mortgage conventional loans, including Fannie Mae and Freddie Mac loans
America's Servicing Company loans
Veterans Association (VA) loans
Home Credit Solution (HCS) loans

Contacts - if you need assistance

With process-related questions, or specific questions regarding offer status or initiating Wells Fargo short sale properties:

Call the Wells Fargo short sale team at 1-866-903-1053
Representatives are available to help you Monday through Friday, 7:00 a.m. to 10:00 p.m., and Saturday, 8:00 a.m. to 4:30 p.m. Central Time

With technical questions about Equator workstation:

For support via web chat, log in to the agent portal at www.equator.com, click on 'Need Help? Live Chat Online
For support via email, please address questions to agenthelp@equator.com

Don't delay. Start using Equator to streamline the short sale process for your Wells Fargo properties.

Sincerely,

Bart Vincent
Senior Vice President, Short Sales
Wells Fargo Home Mortgage

Wells Fargo Home Mortgage is a division of Wells Fargo Bank, N.A. ©2011 Wells Fargo Bank, N.A. All rights reserved. NMLSR 399801 CS3198 - 5/11

Purchasing a property in Los Angeles that is a probate is very easy. The property is listed on the MLS, so your Realtor can help you find what's out there and help you find a good property. You will likely need 10% down to make an offer. There are two types of probates. With court confirmation and without. If it has court confirmation you will need to go to court and it will be subject to over bidding. Over bid amounts are usually 5% above the accepted offer plus $500. After the first overbid you can bid in increments of your choosing. If you are an over bidder you will need to have a real estate agent present with you are the time of bidding. The judge will ask if there are any overbidders for the property you are interested in. You will need to step forward with your cashiers check for 10% of the overbid amount plus 10% of the maximum amount you plan on bidding.

If there is no overbid it's like purchasing a regular property. If you are the accepted offer keep in mind that a probate will likely not pay for termite and some items that are normally a seller's responsibility. The sale is likely as-is. Depending on what your offer is, it's customary not to schedule a court date until the buyer has removed their contingencies (inspections & loan). If there aren't any overbidders at the court confirmation then you can close escrow afterwards usually within 15 days.

On average it took less Time to Foreclose in California, Arizona and Nevada in June 2011, countering what has been a growing trend to extend the foreclosure process. The time to foreclose has increased on a year-over-year basis throughout our coverage area, with the largest increase seen in Nevada where it now takes on average 319 days to foreclose, up from 239 days a year ago. California saw the second most significant increase with the average time to foreclose at 317 days, up from 261 days a year ago. The least change was observed in Washington where the average time to foreclose is 106 days, only slightly higher than the 105 days seen a year ago.

Foreclosure filing activity was down throughout our coverage area in June 2011, with fewer foreclosure filings in all states. There were fewer foreclosure sales, both Back to Bank and Sold to 3rd Parties everywhere except Oregon which saw an uptick in activity at the courthouse steps.

"While the decrease in the time to foreclose last month is statistically interesting," says Sean O'Toole, CEO and Founder of ForeclosureRadar, "We do not see it as signaling an end to lenders looking to avoid losses that they can't afford by continuing the extend and pretend policies of the past."

California saw slowed foreclosure activity across the board. Notice of Default filings fell for the third consecutive month after a slight 1.5 percent drop in June. Notice of Trustee Sale filings were down in June as well, with an 11.7 percent decline month-over-month and a 34.3 percent drop from June 2010. Cancellations of foreclosure sales decreased for the second time in as many months, with a 3.0 percent drop compared to May. Foreclosure sales on the courthouse steps were slower than the prior month, with 13.4 percent fewer sales Back to Bank and 7.1 percent fewer foreclosed properties Sold to 3rd Parties. For the first time in six months the average time to foreclose decreased, down 7.9 percent to 317 days month-over-month but remained up 21.5 percent as compared to this time last year. Third parties continued to resell inventory more quickly, with the time to resell down 1.5 percent month-over-month to 131 days, clearly outperforming banks, which took an average of one hundred days longer at 231 days to resell inventory (REO).

Data courtesy of Foreclosure Radar

If you have a pulse and you are active in the short sale game, you have undoubtedly heard about Bank of America's Cooperative Short Sale Program. It is hailed as a HAFA-like short sale program without the mucky guidelines of HAFA (like occupancy status?).

An ex-top B of A negotiator, Elena Celestine, who is now their circuit speaker, talked about this program at an event I attended in Los Angeles last week. She was a gifted speaker, and fun to watch in action. She scolded agents lightly from time to time for the goofy things we do, and even told the occasional "homeowner" joke. But one thing was apparent. She was out of touch. She said that B of A's Coop program was basically HAFA without the occupancy restrictions. One problem, HAFA no longer had the same occupancy restrictions since SD 10-18 came out earlier this year. Also, she said the Coop program was identical to HAFA in all other ways. Uhhh, nope. It does not promise the $6,000 to the junior liens, it does not "always" promise full satisfaction of the debt, and it is vaguely defined in several other areas. It is an investor-driven program with lots of potential. But, it is not really like HAFA except for the fact that the program does offer pre-approved listing prices when B of A can get in contact with the borrower early on.

That brings us to my little tale. I was referred to a nice lady (and her not so nice soon to be ex-husband) to discuss the option of a short sale. She lived in a beautiful Riverside, CA 3,000 sq. ft. home on an acre of land with a beautiful infinity salt water pool with a million dollar view. She has a first with Bank of America for $550k, a second with Green Tree (was B of A HELOC) for $225K, and a third with Key Bank which is a quasi-construction loan for $55K. The property is worth about $500k today. Not a pretty deal to say the least. But there was a bright side!

The first with B of A was initiated by B of A as a Coop short sale. I even got a call from Christine Gonzalez from the B of A Simi Valley office to prove it. She told me that I would need to do no negotiating for my client as the Realtor. Wow! You mean you guys will deal with the NASTY Green Tree for me? You know they will demand a minimum of 5% of the purchase price on all charged off debt. Is B of A willing to do that? Her answer..."we will allow $3,000". How about the construction loan third? "We may not allow them to get anything." Christine, will you be doing the negotiating on this file? "No, John Bustos who sits next to me will". Oh, so he's who I should be talking to...

Bottom line folks, this is a mess. She is a low-tiered set up person who makes fanciful promises to the borrower to encourage her to initiate the short sale so she (Christine) can get a pat on the back and move on to the next borrower. Another out-of-toucher.

I just took the listing last night, sign goes up tomorrow, and it is "pre-approved" at $500k. I'lll keep the network posted on how this transaction transpires. Should be interesting.