I’ve been waiting for this one to come. Last week the Attorney General for New York, Eric Schneiderman, finally sued Bank of America, J.P. Morgan Chase and Wells Fargo basically for fraud in the foreclosure mess from both 2010 and last year where many people were being foreclosed upon without the proper documentation or even evidence that they were behind on payments. What was known as robo-signing, where those tasked with verifying information decided to just sign foreclosure notices instead of doing their job, took place all across the country and caused a lot of headache to people, including displacements.

Probably the only reason those 3 banks are being sued is because overall New York didn’t suffer as much on loans as other states did because it’s highly regulated and thus doesn’t allow the kind of loans that destroyed countless families and lives in other states. Still, there were a high enough number of foreclosures because the state economy was suffering so foreclosures were occurring.

In my opinion this should have resulted in criminal prosecution for someone, whomever thought that they could get away with something like this. That a couple of the banks on this list got government support in 2009 so that they wouldn’t crash and burn is even more troubling because I had thought that the government was watching these banks to see what they were doing while they were waiting to get paid back for those loans although, to be fair, Bank of America did pay the government back in December 2009, although they really weren’t in a cash position to do so.

Still, with the housing crisis moving into year 5 and people still wondering if we’re going to pull out of it, even as it’s starting to show some signs of recovery, it seems like something criminal took place and that the banking powers that be got away with something.

Who’s with me on this one?
 

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Buying a house can be a fun but challenging and time-consuming task. There will be a lot of time spent in sight-seeing and visiting different prospect locations before landing to the perfect and ideal site. This process entails financial resources. Thus, it is something that you must take great precaution in. This article gives you five helpful tips on how you can save money when considering buying a house.

1. Avoid the Sales Agent

One of the major real estate agent disadvantages is that they are the extra middle man in a real estate deal. Real-estate companies give commissions to their Sales Agents and this cost can be passed on to you. As nice as they may be and as informative as they may seem, their duty is to see that the seller gets the best deal possible with their add-on percentage. So as much as possible, go directly to the owner of the house you want to purchase.

It’s best to buy your empire from someone you know—and in cash—so that you can have a higher chance of availing discount. Then you can save as much as $5000 to $7000.

2. Location Research

Go house shopping but as a first step, figure out what kind of home you might like and which amenities are most important for you. Secondly, estimate your price range and look at houses which match to your budget. This is to prevent yourself from falling in love with a home that is too expensive, which you will later regret.

You may visit the neighborhood several times to know how the surrounding environment can be in the morning or in the evening, to know how good or bad it will be to live there and to verify about the security concerns. If you feel that it has bad points but somehow can be overcome, highlight those points to the seller. Use them as your power to haggle. Compare and contrast payment terms. Think twice and take the best deal.

The rule is: the larger the lot of the house you buy, the lesser the cost. For example, a 300 square meter house and lot will cost $200 per square meter versus that of a 700 square meter house and lot which will only cost $180 per square meter. In addition, the trick here is that the larger area you buy, the more negotiating power you’ll have.

3. Bulk Buying

If you’re not rushing to reach a sale, research for the resale value of the houses in the perimeter after 5-20 years from the current year. You can make it as your real estate investment.

4. Foreclosed Properties

Check out foreclosed properties on your desired location. These properties cost relatively lower but are usually for bidding. Do your homework. Your opening bid should be based on the sales trend of similar homes in the neighborhood. So before making it, consider sales of similar homes in the last three months. If homes have recently sold at 5% less than the asking price, you should make a bid that’s about eight to 10% lower than what the seller is asking.

5. Going Green

US government implemented tax breaks for those households who chose to go green. Go for a house with Green Innovations Installed. This will lessen the cost of your monthly/yearly tax payments.

Final Say

Buying a house can be costly but with extended effort you can trim down your expenses. Study the local laws and aim for the houses that you can afford. Then sign the agreement paper according to local rules and regulations. Terms and conditions of the agreement vary from state to state depending on local custom. Keep the original documents with you. Read the documents carefully; get clear all your doubts. Pay in advance (and better in cash), and the remaining amount as per your signed agreement. Don’t pay full amount until you get satisfied. Buy only what you can.

Jessica Francisco is a cheerful 25-year-old with an odd sense of fun. The least of her broad range of hobbies include swimming, hiking and listening to the music of Michael Jackson. Jessica is also one of the editors of Luke Roxas.

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If you’d asked a novice forex trader before the subprime meltdown in 2007, if there was an obvious correlation between volatility in the American mortgage market and currency rates, you may have received a puzzled look. Since then, people’s recognition of the words “Credit Default Swap” has expanded exponentially; even if they don’t necessary know what this structured product is and how it impacted the subprime fallout, they know these words are somehow involved!

But let’s look more closely at how the movements of the U.S. housing market can have a direct effect on foreign exchange. Every forex trader, be they a veteran or newbie who wants to learn forex, should be aware of the connection.

Most essentially, the sheer gravitas of the U.S. dollar means that every forex trader should be keeping up to speed with the U.S. housing market and its vicissitudes. This is one of the biggest lessons learned from 2007, where the subprime mortgage crisis led to a slump in the US housing market, decimated the US economy and then caused a ripple effect across the western developed economies in one very devastating swoop.

The Heavyweight Dollar Packs a Serous Punch

The US Dollar is the highest traded volume currency in the world. As such, its force will be felt by forex trader, for better or worse. When the US housing market falls into a slump, this has a negative effect on the US economy as a whole, with poor financial results leading to a change in forex traders’ behavior with the US dollar. It will also have a cataclysmic effect on a range of financial indicators, such as mortgage futures’ values. This will once again impact negatively on the US dollar. In light of this, it is very clear that the U.S. housing market can and does have an oblique but nonetheless powerful effect on foreign exchange.

Even if you do not trade in US dollar, you need to know the impact that it can have on your own trading profits and risk exposure. As the US dollar is at such high liquidity, it follows that anything negatively affecting the US dollar will in turn affect the US economy and lead to a domino effect, eventually having a negative trickle-down on your own currencies of choice.

Rick Silver is a Financial Writer and contributor to Everest Forex. She spent many years working at leading U.S. investment firms and banks, within the fields of foreign exchange, commodities, structured finance, asset finance and corporate finance.
 

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I live in one of the more stable housing markets in the country. These days stable pretty much means that the value of housing in this area isn’t falling. The rate of foreclosures are higher than normal, but not close to the number other states are dealing with.

by Roger Wollstadt via Flickr

However, even in this area you can tell there are problems with housing in general. Staying flat isn’t growth, and planning to not lose money isn’t a winning proposition. What’s going on here is actually still going on in those housing markets across the country that are struggling mightily. What is it about housing that continues to make it fail? Let’s take a quick look.

1. Too many existing homes are on the market. You’d think this would make it a buyer’s market until you realize that the reason many homes are on the market is because the owners couldn’t afford to pay on them anymore and there’s not a large enough market of people looking for homes to take over.

2. Too many new homes are being built. Can you believe this one? There aren’t enough buyers for existing homes and yet home builders are still building new homes. And these new homes are priced right enough so that they’re very attractive when compared to an existing home that no one has taken care of for a long while. That plus even if someone’s already living in a home new homes just seem to add something that buyers like.

3. Home loans are tougher to get. We all knew that banks would tighten up their criteria but not as much as they have. If they can find any kind of blip on your credit report you’re done, no matter if you have a good credit rating otherwise or not. They’re looking at the type of job you have and determining if they feel it’s in a stable profession or not. They’re also starting to require higher downpayment amounts and closing costs amounts. They’re certainly not making it easy.

4. Too many foreclosures still coming. I’d thought the bell curve had been reached and the number of foreclosures would start coming down. Well, that actually happened, but when you keep adding more of them to the list percentages go out the window and pure numbers come into play. Some banks are trying to alter the market by keeping some of these homes off it, but I’m thinking this isn’t the best strategy around.

The housing industry needs a hero, an entity that will step to the plate, work with existing homeowners to help them through struggling times to stem the number of foreclosures, and then work with potential buyers to help them get into new or existing homes. Local banks and lenders do what they can, but it’s going to take one of the big boys to really get things moving. And with the trouble they’re in with trying to raise revenue, unfortunately it’s probably not coming any time soon.
 

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Buying a home is one of the largest financial decisions a person can make. The process of looking for the perfect home, saving up for a down payment, and finding the right lender who can give you the best interest rate takes a huge amount of time and discipline to make sure that you are getting the home you want at a price that you can afford.

One of the hardest things a person can endure is losing their home, which is happening more and more in this economy. Why are so many people losing their homes? And is there a way that this could be avoided? Sometimes it is impossible to avoid foreclosure and losing your home, but there are some ways that this might be avoided. One of the best ways to save money on your home loan and purchase a home within your price range is with an FHA Home Loan.

FHA home loans are loans that were designed to help first time homebuyers get into their homes more easily. These loans are insured by the Federal Housing Administration, which means that homebuyers don’t need to purchase separate private mortgage insurance. This saves the buyer money and time and allows them to focus on finding the perfect home as opposed to spending time finding an insurance provider who can offer them a great price.

There are a few FHA loan guidelines that need to be met, but the application process, approval process, and administrative hassles for FHA loans are all minimal and streamlined. Additionally, there is little money required up front for a down payment; sometimes as little as 3.5% of the purchase price is required. This is a huge amount less than the standard 10-20% that is typically required with a traditional mortgage.

In addition to the low down payments and included mortgage insurance, FHA home loans are great because they don’t require that the home buyer pay any of the closing fees up front. These fees are added into the price of the loan and can be paid off over the term of the loan. Closing fees can add up to almost 6% of the total price of the home, so being able to pay these off over time can be a huge financial relief for homebuyers who haven’t been able to save enough to cover closing fees. In addition to all of this, FHA loan amounts can be increased so that more than the price of the home can be financed, giving the buyers additional money that can be used towards home improvements or making your home more energy efficient, as well as making it easier to acquire payday loans when needed.

If you are considering purchasing a home, an FHA loan should be the first thing you consider. It is important to get qualified for financing before you start shopping for a home so that you know what your budget is and what kind of home you can afford. You don’t want to fall in love with something you can’t have, and it’s crucial that you maintain realistic expectations for your new home. Speak with a qualified lender and find out what kind of home you can purchase.

This article was provided by Jessica Thorseon of FHAHomeLoan.org, a leading online FHA information portal. They assist home buyers in finding lenders who can offer them the best rates on FHA home loans.
 

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Last week a study came out saying that 61% of people asked still believe that they want to buy a home and that they see it as a great investment. I hate to bring people down, especially since I’d love to see the housing market recover, but that’s just not reality.

by James Thompson via Flickr

Only 5 years ago, buying homes was all the rage. There were multiple TV shows on showing people how to buy a house that was a mess, clean it up with some minor improvements, then sell that home at a nice profit. When the housing mess hit, many of those people found themselves in a world of hurt and all those shows disappeared. You also notice you don’t see all those commercials on TV anymore showing you how to buy homes for nothing and sell them for thousands.

The reality is that the housing market is a mess, and if consumers are looking to buy homes they need to buy them for better reasons than thinking it’s a great investment. Let’s look at 3 myths of buying a home.

1. Investment. In at least 10 states right now, many people are selling their homes because they’re now worth thousand, for some hundreds of thousands, less than when they purchased the house. It used to be thought by many that owning a home for 30 years meant you’d cash out at the end of it and be living high.

The truth is that whatever you purchased your home for isn’t the only consideration you need to think about when it comes to figuring out if you’ve made any money or not. How much did you spend in improvements? How much did you have to pay for work on your lawn, broken utilities, etc? When houses used to cost $25,000 and could be sold for $200,000, maybe it was a great investment. These days, you might buy a home for $200,000, put another $50,000 into it, and sell it for the same amount if you’re lucky. It’s not a great investment anymore.

2. Freedom from rent. Let’s talk about this one for a bit, and I’ll use my own numbers, if you will. We purchased our home for less than $100,000. Our initial mortgage payments were around $1,200 a month, which included escrow and home insurance. Our utilities averaged around $375 for the first year, which means a monthly outlay of around $1,575 for at least 2 or 3 years until we refinanced. Our 3-bedroom apartment cost us $670 a month when we moved out and we were paying utilities of around $25 a month, since heat was included. Therefore, our initial outlay was about 150% less than what we ended up paying for mortgage, et al.

Even now, years later, though my mortgage has come down after refinancing, utilities have gone up because of the price of oil and I’m still paying more for it all than I was while renting. Not only that but if something breaks I have to pay for that. I have to pay for upkeep. I have to pay for extermination services here and there. In other words, there’s way more money coming out of my pocket than there was in the apartment, where everything was covered.

3. Personal space and privacy. If you think this one is real I’m about to burst your bubble. Sure, in the apartment there were people all around me, but I never knew any of their names because they kept to themselves. Apartment living is like that for the most part; you might get lucky to know a couple of folks here and there, but in general you may never say anything more than “hi” to anyone in the building.

When you buy a house, there are a lot of people who know you, or of you. In my neighborhood, everyone knows everyone to a degree. They watch your house during the day, which does offer a bit of protection, but they also know when you’re home, not home, having a party, cookout, etc. They know who does your lawn and who does your roof and if you’ve lost your job. How do they know? They just do. There’s no privacy at all, even if you try to keep to yourself.

Of course it’s not all bad; at least I know where I’m parking my car every night, and in the winter don’t have to shovel it before I go anywhere. Then again, I have to shovel my own driveway or pay someone & hope they come early enough to get out of the house. Does it all still sound like a dream?

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A new study came out recently that said many people are still interested in buying and owning a home, even with all the mess that’s been the housing market over the past few years. Of course, there are a lot of great deals in many states so it makes buying attractive. Still, one has to ascertain if they’re actually ready to buy a new home. Here are 5 things to take care of before you get into it all.

via Flickr

1. Check your credit report. This is actually more important than your credit score, which I’ve always contended is worthless to begin with. Your credit score is what ends up being used to determine your credit worthiness anyway so it’s the place to start. Look to see if there are any negatives on your report. If so, take care of them, or at least have a response to them because if you see it, a potential mortgage officer will see it as well.

2. Check your income. People are always encouraged by real estate representatives to buy more home than they can afford. That’s because it gives them a bigger commission; they’re just not going to tell you that. If you make $40,000 a year you’re not going to be able to afford a $200,000 home; trust me on this one. Even at 4% mortgage loan rates, don’t do it. Base everything on three things: a) how easy you can pay your present bills; b) how much more you can pay monthly on a mortgage (and escrow in some states) than what you’re currently paying for rent; c) how much your utilities are now because they’re going up (at least double, in some cases 10x).

3. Do some online research. This is really important. Almost every single home you’re looking for is online, but you won’t see them all because not one site will show everything. However, what a site will show you are styles of houses, neighborhoods those homes are in, information about those neighborhoods and prices. Tp have at least some idea of what you want, this is a major help.

4. Talk to your friends that own homes about the process and their realtor. Some realtors are great to work with; others are horrible. Also, the process of buying a home can be stressful; it took us 6 weeks to get the home we selected.

5. Don’t start the process if you don’t have free time to go look at houses. Trust me, you’ll be amazed at how long it takes to look at houses once you start. You’ll find something you like in almost every home and you’ll find things you don’t like in almost every home. Very few people buy the first home they look at unless they’ve done some research online first and saw pictures of every room. When I was looking we were in a couple of houses for almost an hour. It’s not always fun, and you need to be in the mood so space things out and don’t rush. There’s always another house to look at so never feel pressured by anyone.

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Foreclosures are still hot and heavy, although they’ve started to slow down in some areas that have been hard hit. The reason they’ve slowed is because at some point there could only be so many homes left that could be foreclosed upon; it’s certainly not that the economy has improved all that much.

The strange thing about all of this is that more families are able to stay in their homes longer because there are so many homes that have been foreclosed upon. That and the mess that was caused by companies that were robo-signing foreclosure notices without making sure all the paperwork was completed or if the foreclosures were legal to begin with. I don’t think there’s a person in the country other than the people that work for Bank of America that weren’t happy when one of their banks was foreclosed upon because of a judgment won by a man they had illegally sent for foreclosure.

Now, this does seem like a good thing for those people who had nowhere to go and thus are able to stay in their homes longer, but one has to hope they’re trying to do something about their situation. Everyone who’s foreclosed upon has an opportunity to get out of it if they can get the money together to start making payments again, and banks have been working with those people who are suddenly able to continue making payments on homes. Whereas I think in the past banks looked at foreclosed properties as a second chance to make money off of a home, I believe they’d rather not have to deal with as many foreclosed properties as there are now.

So take the gift you’ve been given because of the system and please work as hard as you can to find the money and keep your home.

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Housing has been in trouble for a few years now, and the numbers have started looking a little bit better lately. However, just as the figures from when the housing problems actually began might be fudged just a little bit, it seems that some of the latest housing figures might not really be telling the whole story either.

Happy Rizzi House, Brunswick, Germany

Let’s take a look at the first part. Many people believe the housing industry crash began around 2006, possibly 2007. In reality, the housing industry crash began much earlier, probably when subprime mortgages came about in the 1990′s. Suddenly more people were qualifying for houses that they couldn’t afford, and home builders went crazy and started building a lot more houses which also began inflating the price of homes.

Now we’re at a point in time where in many states homes have lost a lot of their value, which they probably never really had, and homes are selling at drastically reduced rates. Yet there are many homes not on the market as banks are trying to artificially keep prices up by not releasing all the homes that are available. Add to that the fact that banks and lenders have also tightened standards and lengthened the time it takes for someone to find out whether they’ve been approved for a loan or not and you have an industry that’s imploding on itself and certainly not looking like it’s ready to break out of its malaise.

I’m not the only one saying this. The National Association of Realtors said that existing home sales fell almost 10% in February and that the sale of new homes fell in February to levels that haven’t been seen in almost 50 years. This news is bad enough, but when you add in the fact that there are still an extremely high number of foreclosures and that unemployment is still very high (another number that’s probably higher than reported), it’s not surprising that the housing industry’s problems just might extend longer than anyone could have imagined. To say that home prices are up and try to talk about the spark in new homes sales signaling an end to the crisis is stretching the truth “just a little bit”.

And I say this as a homeowner whose house is increased in worth supposedly almost 50% from what I purchased it at, for no discernible reason except for a townhomes community that was built about 1/2 a mile from me, whose home prices started at that 50% mark and sold out within weeks. That’s not the best way to assess what housing is worth, whether it benefits me or not.

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Like most other things, you either love or hate home assessments. It’s an odd thing because the mount your home is assessed for is used for both getting more money out of your pocket and getting more money into your pocket, although not necessarily at the same time. It’s this strange dichotomy that drives both individuals in areas where they live crazy.

Cities, towns and the like all want your property assessed as high as it can be. This means higher taxes they can get from you to help them fund all those things throughout the community that you either care or don’t care about. For some people, if you have children you don’t mind this; for others, if you don’t have children you hate having your tax money going to education. Unfortunately, you don’t get to pick and choose; that’s just how it is.

For individuals on the other hand, it’s a dichotomy that makes you sick. You don’t let your property assessed, at least by your local municipality, because they are gonna charge a higher property taxes. In the area I live, one of the local towns just had their first assessment of local properties in about 10 years, and most people have learned that their property taxes are doubling. In a tough economy, it’s not a pleasant thought knowing that you’re going to have to try to find the money to pay more taxes.

On the other hand, we all want banks and real estate movers to assess our property hire than even we can imagine it could be worth. If we’re looking to sell our home we all hope to make more money off of it then we paid out when we bought it and started paying mortgage on it. If we’re looking to get a line of credit or home loan, it works out in our favor if our home is assessed as high as possible.

In general, we like or hate assessments based on the timing of them. Unfortunately, were not always in control of those times. The best we can hope for is that any assessment is being done on our property is a fair one. For instance, there are some areas of the country that have people doing assessments on their homes that have never seen their homes and don’t live any where close to where their home is. All they do is take an estimate of surrounding property, which they can get online, and come up with a dollar amount. Something to work for you, other times they can backfire, but either way it’s not all that fair.

What’s the best thing for you to do? You probably should pay someone to do an assessment of your home and property. If you do this regularly, you would least have a legitimate dollar amount of what your home should be worth. If your local municipality doesn’t assessment and they come up with a much higher figure, you can always challenge it by taking your assessment in with you. If there figure is lower, you can keep your mouth shut and still go off of the piece of paper you got from your own assessor. It’s not perfect, but either way you have a chance to at least get some fairness.

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Locally there was a poll taken of consumers on what they were thinking about the housing market. Overwhelmingly it was stated that they believe it’s much easier to buy a home in this marketplace than to try to sell one.

That seems to be the belief across the country as well. Large housing companies are building homes again, even in areas where housing really fell flat during the economic crisis. Here in Syracuse it never stopped, just slowed down a bit, and yet homes continued to be sold as long as they were new homes.

I’m someone who tends to believe that without a symbiosis things can’t be seen as working out all that well. Therefore, I don’t believe that just because new homes are selling that it makes everything better if those in existing homes can’t sell them, even though their prices continue to fall. That in and of itself is a major sign that there’s still an issue, as traditionally we’re all used to our homes going up in value. At least that’s the dream we were sold on when we bought our homes, and it was fairly true at that time.

So, if the adage for home builders is “build it and they will come”, what slogan can existing homeowners looking to sell their homes live with? Right now it borders close to a line Richard Pryor used in one of his comedy routines, slightly altered here: “You bought it, you keep it.”

It’s pretty clear now that going forward, anyone who believes that buying a home is an investment into their future is living a lie. Sure, home values may go up, but they could just as easily fall. I tend not to trust the big banks one bit, and they’re the ones who are still giving out the most loans for homes, even if they’ve presently increased their standards for whom they’ll give loans to. With so much still in the news about illegal foreclosure practices, I think anyone who goes into home ownership with their eyes closed it kidding themselves and possibly putting themselves in jeopardy later on.

Home ownership is expensive. It can be fun as well, but you need to be ready for the ups and downs of it. After all, you’re signing up for a long time.

Early last year, many Republicans were trying to put the blame for the housing crisis on Rep. Barney Frank of Massachusetts. That’s because Frank was a strong supporter of affordable housing for all, especially those people who at the time couldn’t afford to buy homes.

What happened? Banks came up with unique ways for those who couldn’t afford homes under their current plans to be able to afford them later on. Those floating interest rate loans came back to haunt both homeowners and banks when the real estate crash came. There was a lot of blame to go around, and even Frank stated later on that may be pushing for those who couldn’t qualify any other way to be able to own homes was overly ambitious.

Still, that doesn’t excuse banks and lenders for what they did. Last year I wrote on this blog that blacks and Hispanics were given predatory subprime loans at much higher interest rates, where 54.7% of black borrowers paid a higher interest rate than average, and 46.1% of Hispanics paid higher than norm.

Why is it racist? Because these lenders targeted residents of poor neighborhoods to offer them these outrageous loans specifically, and no one took the time to explain to them exactly what the risks were. This came from a study by the Woodrow Wilson School of Public and International Affairs at Princeton University. This was a total reverse of the normal practice of redlining, which all banks say they didn’t do but it was so obvious that it was laughable. A quote from the report is most striking: “From 1993 to 2000, the share of subprime mortgages going to households in minority neighborhoods rose from 2 to 18%.”

At least with redlining these lenders weren’t going to bring down an entire industry; not that anyone outside of banks and mortgage lenders support redlining. The point is that banks went to extremes as it regarded minority applicants. It was feast or famine, and the selling of a dream of home ownership to those who were most vulnerable was irresponsible without more education.

What can be done now? Pretty much nothing. Some states are getting relief from the federal government to help those people who are still in their homes but struggling while some former homeowners can “look forward” to heaping settlement “reimbursements” for losing their homes from banks like Wells Fargo averaging around $2,500 per household (Wells Fargo didn’t own the banks that did this to those folks; just felt a fair disclaimer was warranted); that won’t help much.

The best advice one can ever give is if something seems like it’s a miracle, check it out as much as you can, including asking someone you trust for advice. This is a major mess that’s going to take awhile to recover from.

For the first time in 18 months, foreclosures actually slowed down, giving the housing industry a little bit of relief. But only a little bit of relief because it’s definitely only temporary.

What caused the reduction? Two main things occurred. One, the federal government and state attorney generals started investigations into “robo-signing” of all those foreclosure notices, and that made a lot of banks stop or slow down processing for awhile. Two, like last year, some banks decided to withhold on foreclosing on properties for the last couple of months of the year because of holidays and the like.

Why is it only a temporary solution? Because unemployment is still high and some of those bad loans are still around. Some banks are finally coming around, though. Wells Fargo is modifying around 15,000 mortgages for people who were almost foreclosed upon, which comes to around $2 billion, due to practices by banks they took over. They will also be paying around $32 million to people who have been foreclosed upon, but that only averages out to around $2,670 per family; that’s little comfort, but it’s something I guess.

Nevada still leads the nation in foreclosures, with Utah jumping into the mix, albeit briefly, since the other “normal” states with high foreclosure rates, Arizona, California, Florida, Illinois, Georgia, Michigan, and Colorado, benefited most from the slowdown of foreclosures and bad banking practices. I still believe most foreclosures should be halted until the investigation is completed, and I really believe there should be larger penalties against banks that participated in what I’m calling the destruction of the housing industry, especially those banks that got federal stimulus money.

In any case, a breather is nice for those families suffering right now. It won’t be nearly enough, but maybe some will benefit at least for the holidays.

Foreclosures have changed the housing industry more than anyone can imagine. They’re the fault of banks; my opinion. They’ve also ended up hurting a lot of banks, and that story is told over and over by the number of banks that have closed because of it. But the overall housing industry is reeling.

Here’s the thing about foreclosures. It seems that banks haven’t even been trying to be fair to home owners. We now know that the scandal of banks having people sitting in rooms just signing papers they weren’t reading or evaluating, called “robo-signing”, has caused banks across the United States to be investigated by the Department of Justice. There have been stoppages in foreclosures, and in the last few weeks of the year it’s expected that all foreclosure activity will probably cease, as it did last year. This time it might not be because of the government; it just might be because even banks need a breather from the bad behavior and overwhelming numbers of foreclosed properties they’ve helped cause.

At first, it seemed like banks would make out like, well, the bandits I say they were. They now had all these properties back that they could put on the market and make a lot of their money back. Lo and behold, they found that not only were there too many properties, which reduced the amount they could offer these homes for, but that the overwhelming number crushed the new home building industry, which they relied on for real monetary sustenance. Wow, a two pronged attack; terrorists couldn’t have done a better job.

Where does it all leave us now? Banks are still being investigated. Some states have banks withholding the number of homes they’re putting on the market, trying to artificially keep home prices up. Companies that were buying up foreclosed properties, fixing them, then reselling them have stopped buying as many of these properties because they don’t want to get caught up in the scandal. Because unemployment is still fairly high sales have dwindled. And banks still aren’t approving people who have pretty good credit at a rate sufficient to move merchandise because they don’t want to get burned again, even though they’re the ones who caused the mess in the first place.

Oh yeah, and now mortgage rates are going up, which will also reduce home sales. One industry is imploding and it’s taking everyone else with them. There never was a true symbiosis between banks and the housing industry; it just seemed that way. The reality is that banks have controlled the industry, and many others, for decades, and they need to right themselves so everyone else has a chance to recover.

Don’t bet on it; greed is hard to give up.

The housing industry has been in an uproar for a few years now, and things are starting to come to a head. First we hear about robo-signing of foreclosures. Next all 50 states and the federal government ask banks to stop foreclosures until this practice can be evaluated; some banks do it, then decide they’re doing okay and proceed with the process.

Now there are two different things going on that are bringing the foreclosure wars to the courts in many states.

The first involves this process of robo-signing and whether banks should be penalized and most foreclosures withdrawn. That’s what’s going on in Ohio, where the attorney general, Richard Cordray, has filed suit against both GMAC and Wells Fargo for tens of thousands of invalid foreclosure papers that have been found in their investigations. They have testimony from the people who signed these papers that they never looked at any of the paperwork; how come none of these people are going to jail?

The second involves lawsuits against banks like JP Morgan and Bank of America that are foreclosing on homes where the owners were making payments they thought were legitimate, but the banks are saying they weren’t because they hadn’t fully processed loan modifications for these people, or ended up not giving them the permanent modification, only didn’t let the people know far enough in advance that there were problems. The lawsuits are both individual, state and federal against the banks, who say they were under no obligation to approve anyone, then decided to stop talking at all.

The question isn’t why the banks are fighting all of this, because they’re not all doing well financially. The question is just how stupid are the powers that be in these places anyway? How can some of these lenders own up to what they’ve done to homeowners by causing the mess that’s devalued their property and brought about all of these foreclosures, then turn around and say they have the right to foreclose because people aren’t doing what they’re supposed to do? How could the people do what they were supposed to do when the banks not only didn’t do what they were supposed to do with loan modifications, but really didn’t know what they were supposed to be doing because of the lack of good communications between the banks and the consumers? For that part, how come many of these lawyers who should have been reading the contracts these homeowners ended up signing aren’t being subpoenaed as well?

Frankly, I’m almost ready to predict that the day of the major national bank is about to end, and I’m not really depressed about it at all. Not that my bank is perfect, but they’re at least fair and upfront about the way they do business. And they haven’t been accused of any of these bad mortgage deals nor anything else nefarious.

Anyway, predictions are that as things start to escalate there will be an offer of a settlement of some kind. I don’t know how it will transpire, but I do feel I know that the banks don’t have enough money to fully take care of the mess they’ve illegally caused. After all, Bank of America just lost $7 billion.

Over the last 3 years there have been a lot of foreclosures across the United States. Some states have been decimated by this, and it’s taken the housing industry down as well. I have stated many times in many places that I believe the banks caused this problem; now it seems I may finally be getting some backing on it.

There’s a federal task force being put together to examine foreclosures and the processes that have led to so many of them going through so fast. The belief is that banks and other financial institutions have used fraudulent documents in pushing these foreclosures through, partly through a process where some banks had people just signing paperwork without reviewing it. The belief is that many people might have been illegally evicted from their homes and that they were targeted by companies that lied to federal housing agencies by filing false paperwork.

This was part of the reason a call was made requesting banks and other financial institutions to stop foreclosure processes for the time being, which many did, even though Bank of America decided to resume almost immediately afterwards. Of course, they did have to forgive $3 billion in loans back in April, as well as deal with having to buy back $47 billion in bad loans from Countrywide Financial, which they also own, so I’m sure they’re feeling justified in being able to continue funding themselves on the backs of those who are in financial distress on their homes.

And it could get worse, as the Securities and Exchange Commission is also thinking about starting an investigation into all of this. That’s because if it turns out to have some merit, then banks have been using false processes to create a false sense of stability in many companies listed with them, which is in essence fraud.

Could all of this turn out to be a big housing conspiracy perpetrated against both the federal government and home owners? Stay tuned.

If ever there was an obvious headline, the one above is it. The housing industry is in trouble, and it doesn’t look like there’s going to be a fix any time soon.

So what’s going on? We’ll start with the news that existing home sales are at their lowest level in 15 years, down 27% over this same period last year, which was a horrible year in the first place. The $8,000 tax credit ended in April and many conservatives were happy, saying the government shouldn’t have had it in the first place, and look where we are now. Home sales can’t keep up with foreclosures, and those homes that are being bought are going for around 25% less than what they were worth because of it.

The Midwest and Southwest are struggling the most. Home sales out that way are down 33%, and bank closures aren’t helping. Neither is Arizona’s crusade against immigrant workers, one which I’m sure legislators out that way thought would help its legal citizens find work, but instead has created a backlash against the state and an interesting exodus of some of its long time citizens, leaving homes that have no buyers.

Already mentioned was foreclosures, and it’s been determined that at the present time 1 out of every 10 homes is close to being foreclosed upon. Actually, that figure is down a tenth of a percentage point from the end of April, which is nothing to smile about. Arizona and Nevada continue to have high foreclosure rates; how long can it continue to be at a high rate, since it has to slow down at some point by pure attrition?

And, interesting enough, the average home size for new homes is on the decline as well, dropping about 150 square feet over the past year. That doesn’t sound like a lot, but the trend had been towards larger, more spacious homes and now consumers are looking for ways to save money, and are not only cutting down on the size of homes but on some of the luxuries as well.

What are the two main problems with housing? Unemployment and banks. What are the two main ways to fix the problem? Employment and banks. Mortgage rates are at their lowest level in, well, decades, yet banks aren’t approving enough people to take advantage of it. Sure, banks have had to tighten up their processes, and that makes sense, but they’re taking longer to make decisions, and sometimes time is of the essence. There are still banks that are behind on figuring out loan modifications, and that was supposed to have been completed a couple of months ago. As for unemployment… well, we just might be stuck on that one, as federal money is being spread a bit thin, and communities are loathe to try something potentially drastic to help get things moving in a positive direction.

If you have a home to sell right now; don’t. If you’re looking for a home right now; do it!

Talk about an interesting dilemma. Everyone knows about the California housing industry, which of course also ties in with unemployment and the rest of the problems California is having with their finances. A big part of the housing industry’s problem is the high foreclosure rates that are still occurring, even as a portion of their housing market is starting to recover.

It turns out the foreclosure rate could be much higher than it is. Many people have stopped paying their mortgage because they just can’t afford the payments, or because the worth of their homes at this juncture doesn’t seem to make it worthwhile. By all rights, banks could foreclose upon those homes.

But a funny thing is happening. Banks aren’t foreclosing on all the homes that are out there. Some people haven’t made payments in more than 2 years, but haven’t heard much beyond the normal mailing of the bill. What’s going on?

Could be a number of things. One, the rate of foreclosures is so high that banks can’t keep up with them all. Two, banks are worried that by foreclosing on so many homes the values of those homes will tank like they did in Florida. Three, many banks are so far behind on loan modification processes that they don’t know what to do about people who had stopped paying yet were waiting to hear whether they qualified for those modifications. Four, the state has been working on legislation that may have already passed limiting foreclosures in some fashion. And five, the state just received $700 million from the federal government, which is mainly to help homeowners who haven’t been able to make their mortgage payments, and if banks foreclose on those people they lose out on any money that the homeowners they bounced might have received.

All of this makes for a very interesting mix, one that seems like it’s going to take at least another 2 years just to get back to even, whatever that turns out to be. California is a mess; let’s hope for their sake that housing pulls out of it before something else happens.

Many states are trying to work their way out of what’s been deemed a housing industry crisis. To say that things have been bad across the country would be an understatement. In 2009, the top housing markets were those that weren’t in a freefall, including my home area of Syracuse, which was flat yet considered as the 2nd best in the country.

Whether or not you believe unemployment has improved (it hasn’t), things have definitely stabilized in a fashion. And in some states there are plenty of houses that are available for purchase. And yet, not including places like Chicago, which has rebounded fairly well, those homes aren’t being purchased, and home ownership isn’t growing, or at least not growing enough to overcome the bad times.

What’s the problem? In my opinion, it’s all in the hands of the banking industry. True, I blame the banking industry for causing the problem in the first place, and now I’m blaming them for keeping it down. There are many reasons I’m blaming them; let’s take a look.

1. Not giving up the loans. I understand that banks have had a hard go of it, but many of them have gone too far in the other direction and are looking to loan people money who don’t really need it. When rich people with credit scores over 800 can’t get home loans, you know that banks have become skittish on who they want to loan money to.

2. Bank closings. So far, 102 banks have been closed in 2010; this is about 45 more banks than were closed at this point last year. Many more banks are projected to be closed this year. Many of the banks that have been closed are in states that are still having major problems with housing. As other banks are taking over, they’re being a lot more judgmental in who they’re going to give loans to.

3. Banks holding on to foreclosed homes. In some states that have had high foreclosure rates, banks are artificially trying to keep home prices up by keeping some homes off the market. Picking and choosing which homes they want to put on the market means there are many homes that someone might want that they can’t buy. Florida has many homes at low prices, and many of those homes are starting to be snapped up. It’s better for everyone if they can buy whatever home they want, even if the prices are lower, because it helps stimulate the entire industry. Banks, let up on the foreclosed properties.

4. Not processing loans quicker. The reason the federal government had to extend the time for people to finish qualifying for loan modifications is because banks could care less whether people qualify for it or not. They got called out for not processing more of these loans in a timely matter, but the truth is that it didn’t work in their favor, or at least they didn’t perceive that it did, so they didn’t have any reason to try.

That’s enough for the moment. To be somewhat fair, banks do have to change up their criteria a little bit. Some people who purchased homes before weren’t really qualified to buy those homes at the prices they got them for. Low interest rates don’t protect banks from people with risky credit, and that’s understood as well. However, as long as banks in areas with depressed housing markets won’t work with brokers and consumers to try to get them into homes, those markets will continue to suffer, which means the entire country will suffer along with them.

Very little surprises me anymore when it comes to seeing that minorities suffer the most on many financial levels. First it was hearing that blacks and Latinos are taking the worst hit on unemployment than anybody else. Then it was hearing that black farmers still haven’t gotten money from the government that the Justice Department says they deserve. Next on the list was hearing that Wells Fargo, along with many other banks, we’re giving minorities higher mortgage rates to purchase homes than anybody else.

So it comes as no surprise hearing that black and Latino homeowners have suffered more than non-minorities as it pertains to foreclosures. At least as its related to home loans between 2005 and 2008. For that group, it seems that 8% of the foreclosures were from minority homeowners, whereas none minority homeowners had their homes foreclosed upon at 4.5%. The reason this is an important figure is because it shows that even now, lenders are treating minority home owners differently than anybody else, hitting them with interest rates so much more above the norm that they are at the greatest risk of having their homes foreclosed upon. The study by the Center for Responsible Lending also stated that black and Latino communities will suffer the most in declining property values between 2009 and 2012, to the estimated tune of $373 billion.

Of course foreclosures hit everybody across the board, and the overwhelming number of foreclosures came from bad deals that occurred back in the 90s. However, knowing that this is still a common problem, and in listening to some pundits say that they believe all of this is the fault of Rep. Barney Frank of Massachusetts, who helped pass a law to equalize lending for minority applicants, it seems to indicate that lenders pretty much ignored the law in the first place, thus abdicating Rep. Frank of any responsibility for the present crisis.

What happens now? Who knows, since it seems foreclosures are still occurring, even at a lesser rate since so many homes have already been foreclosed upon, and there doesn’t seem to be an end in sight.