Foreclosure and distressed property topics

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[quote author="IrvineRenter" date=1210366216]



There has been a lot of discussion, particularly on Calculated Risk. on the "walking away" phenomenon. IMO, the statistic that will be most telling concerning this phenomenon is the conversion rate of NODs to foreclosures. As homeowners sink deeper underwater, the conversion rate will almost certainly rise as people see the hopelessness of the situation and simply give up. The steep price declines of the last nine months should cause these conversion rates to reach very high levels and stay there for several years. I would guess that the very high rates we are seeing now will rise even higher when people start giving up hope of a rally. There is still denial in the market right now. The peak of the NOD to foreclosure conversion rate will represent market capitulation. I would expect to see it in late 2009 after next years spring rally fizzles.</blockquote>


Last month my calculation of NOD to foreclosure ratio was 55%, and when the DQ numbers come out this month, I will calculate it again. About 6 months ago it was around 45%, and has gone up every month since I started calculating it. I am sure the past ratios are in this thread some where, but even I don't want to go through all those posts.
 
[quote author="graphrix" date=1210385481]



Last month my calculation of NOD to foreclosure ratio was 55%, and when the DQ numbers come out this month, I will calculate it again. About 6 months ago it was around 45%, and has gone up every month since I started calculating it. I am sure the past ratios are in this thread some where, but even I don't want to go through all those posts.</blockquote>




Very helpful information

http://img701.mytextgraphics.com/photolava/2008/04/30/thanksbutton-4acqk9zpg.png





(btw, my 30% conversion was from old information. now that I go back and look again, I see the numbers you report from DQ)
 
Thanks for that graph. Do you know if any of the proposed legislaltion is providing funds or people to help get modifications done? The token payment to the 2nd holder for a SS makes sense. The savings of not having to foreclose would seem to justify it.
 
The token payments to seconds to go away sometimes happens,

but I'm not aware of any recently.



I have any number of suggestions to lenders to save money, or at

least lose less money, based on many years of experience, but

they don't want to hear any of them.



Creativity is punished at banks, and stodginess rewarded, except

when you have a race to the bottom in underwriting standards. And

what's needed now is creativity and flexibility.



I see a very slight more to creativity, but not fast enough and not

for many loans. Total disaster will happen long before decision

makers at lenders come around to the view that you can't save yourself

by rote, and in fact, you can't underwrite by rote either.



The only things that are moving in Miami are short sales, REOs, auctions,

people with perfect credit getting re-fis. No high end moving. Only loans

being granted are of the hard equity lender variety. And a broker who

specializes in these sez

the hard equity lenders are taking values of 50% off peak and then lending

only 65% of that. That is what people with their own money, rather than

"OPM" are doing. And even then, they are worried to death. And oh, yes,

they want 2 points, and charge 14% interest with a prepayment penalty.



If you are in foreclosure and have lots of equity, that's the only way

you can go. Oh, and they refinance the whole thing, no seconds to bring

you current, so you lose your low interest loan which is in default.



A person I regard as not very reliable told me he was at an auction with

high rise units, where they were selling at 30 cents on the dollar. This

will get worse, as 15,000 new condos are coming on the mkt in the next

year or 2.



I asked the broker why they were still doing this and he said that it

takes so long to get gov't approvals and permits that developers are loath

to give up on something that it took so long to get started.
 
<a href="http://www.zillow.com/HomeDetails.htm?zprop=25627838">Here is one for Caliguy2699 in Mission Viejo</a>. Purchased in 2002 for $347k, housing ATM of a NTS amount of $611k, and back to the back for $348.5k. Purchasing this property for $348.5k, would be like purchasing it for $290k in 2002 when adjusted for inflation, and would bring it into the 2000 rollback realm when adjusted for inflation.



Oh, <a href="http://www.zillow.com/HomeDetails.htm?zprop=61644784">I found another good one in Ladera</a>, sold in 3/2004 for $490.5k, flipped in 12/2004 for $575k, fraud in 1/2007 for $689k, and back to the bank today for $369k.
 
My agent represents REO's for Countrywide. She said that what they've started doing lately is actually pulling them off the market after three months to send them to auction. She had a Laguna Beach property back in Dec with a loan of around $1M. Back in Dec she had offers in the low $800's, but they wouldn't take it. In March they pulled it from her, sent it to auction and got $750K. She currently has 7 REO listings in South County. 3 of which they have priced agressively. Of the aggressively priced ones, one is in a multiple counter offer and will sell above asking. The other two she is uploading today. Of the 4 that aren't priced so right, not much interest. I mentioned your figures on the rates of NOD's going to foreclosure and she was stunned.
 
[quote author="graphrix" date=1210400442]<a href="http://www.zillow.com/HomeDetails.htm?zprop=25627838">Here is one for Caliguy2699 in Mission Viejo</a>. Purchased in 2002 for $347k, housing ATM of a NTS amount of $611k, and back to the back for $348.5k. Purchasing this property for $348.5k, would be like purchasing it for $290k in 2002 when adjusted for inflation, and would bring it into the 2000 rollback realm when adjusted for inflation.



Oh, <a href="http://www.zillow.com/HomeDetails.htm?zprop=61644784">I found another good one in Ladera</a>, sold in 3/2004 for $490.5k, flipped in 12/2004 for $575k, fraud in 1/2007 for $689k, and back to the bank today for $369k.</blockquote>


Very nice - thanks for the heads up on those. I have been surprised at the number of properties that have gone pending recently - because plenty of these properties (<a href="http://www.redfin.com/CA/Aliso-Viejo/4-Laurelwood-Dr-92656/home/4872081">like this</a>) are short sales. There also seems to be a good market for REOs priced 20%+ off 2004 prices, which isn't surprising. The other big group are properties whose owners have held them for a while and should have the equity - the question is how low the sales prices end up being. I also wonder how many of the short sales are actually going to close.



There are a LOT of bad loans in South County. Way more than I would have suspected before I started looking property-by-property.
 
Skek--If you are serious, you might get your wish. Miami Beach isn't the

only place for a beautiful water view. Downtown Miami and Brickell

avenue with a view of the bay are wonderful You do have to drive

a short ways to get to the beach.



Need to check if there is enough money is escrow to pay maintenance.
 
Stepping_up,



Your agent seem's dialed in on Laguna REO's. Who are you using? Also, which auction house is getting the pulled REO's?



Thanks,



cdm
 
I thought I posted a nice long post about the foreclosure wars

in Broward County (Ft Lauderdale), but it disappeared.



Short version:



100,000 foreclosures so far in Broward County this year 3x last year,

according to the clerk.



1 of 7 houses in foreclosure, according to the runner for a foreclosure

mill, in St. Lucie County, which is north of Palm Beach County.



These people could be wrong, but they are in the business, and probably

are correct.



Ok, let's see if this posts.
 
Irvine NODs for May through 5/10:



3266 Watermarke Pl 92612 5/10/2008 358,700.00

26 Shadowplay 92620 5/10/2008 651,200.00

33 Rose Trellis 92603 5/10/2008 1,237,500.00

37 Tall Hedge 92603 5/10/2008 1,500,000.00

120 Reunion 92603 5/10/2008 450,848.00

1352 Scholarship # 264 92612 5/10/2008 430,000.00

7 Monrovia 92602 5/10/2008 500,000.00

58 Cezanne 92603 5/10/2008 1,750,000.00

804 Maplewood 92618 5/9/2008 14,990.00

3239 Watermarke Pl 92612 5/9/2008 15,141.00

3141 Michelson Dr # 1305 92612 5/9/2008 13,260.00

10 Lemon Grv 92618 5/8/2008 388,720.00

11 Iroquois Ct 92602 5/8/2008 650,000.00

59 Bamboo 92620 5/8/2008 801,000.00

4162 Fireside Cir 92604 5/8/2008 512,000.00

4481 Charleville Cir 92604 5/8/2008 505,250.00

26 Leucadia # 93 92602 5/8/2008 62,553.00

6 Laketrail 92604 5/7/2008 470,610.00

6 Clover 92604 5/7/2008 417,000.00

71 Avondale 92602 5/7/2008 588,000.00

4535 Sandburg Way 92612 5/7/2008 9,054.00

5012 Yearling Ave 92604 5/7/2008 12,599.00

4082 Germainder Way 92612 5/7/2008 51,213.00

8 Satinwood Way 92612 5/6/2008 560,000.00

305 Terra Bella 92602 5/6/2008 410,000.00

2442 Watermarke Pl 92612 5/6/2008 311,200.00

139 Treehouse 92603 5/6/2008 769,342.00

2 Forest Hl 92602 5/6/2008 20,698.00

2234 Watermarke Pl 92612 5/3/2008 355,000.00

15 Bellevue 92602 5/3/2008 400,000.00

83 Costa Brava 92620 5/2/2008 9,771.00

5 Nantucket 92620 5/2/2008 15,166.00

81 Lemon Grv # 275 92618 5/1/2008 12,713.00
 
Hmm... for some reason I thought 26 Leucadia already went back to the bank. If it didn't, it probably will now, because it's owned by New Parker Inv. Group, Inc. I suspect "investors" don't care about keeping their loans current in this market.
 
[quote author="EvaLSeraphim" date=1210670876]Hmm... for some reason I thought 26 Leucadia already went back to the bank. If it didn't, it probably will now, because it's owned by New Parker Inv. Group, Inc. I suspect "investors" don't care about keeping their loans current in this market.</blockquote>


71 Avondale is on the list as well. It went back to the bank in June and I think got sold at one of those retail/consumer auctions in September. Didn't take the new owners long to stop paying on it...



It's either that or some 2nd mortgage holder didn't get the memo about the foreclosure.
 
Graphrix,



Do you have data on the purchase and sales prices of foreclosures and short sales? It would be interesting to calculate the percentage of foreclosures and short sales due to HELOC abuse. IMO, any property that is a foreclosure or short sale that sells for a paper profit is HELOC abuse. It would be a useful statistic to establish just how common this really is.
 
OC numbers from ForeclosureRadar for April. OC is No. 33 in the state in terms of highest number of foreclosures per population - right above LA and 9 spots higher than it was in March.



<strong>Notice of defaults:</strong> 2520

<strong>Notice of trustee sales:</strong> 1660

<strong>Foreclosure sales:</strong> 1133

<strong>Population per sale:</strong> 2,712

<strong>Vs. March 08:</strong> +82%

<strong>Year-over-year:</strong> +364%
 
Spoke to a potential foreclosee, while waiting for a hearing on

an extention for a foreclosure sale (granted plaintiff's atty didn't

show up).



She bought 2 houses on the expectation of appreciation, one to

live in one a condo. $200,000 underwater on the house 80 on the

condo, and her renter is leaving and the condo is full of foreclosures.



She's a court reporter, hence not mentally challenged. Just goes

to show those iq tests don't mean much.



Asked about her house mtg. It's some flavor of adjustible, she

didn't even know her interest rate, hadn't the faintest idea of the

terms, and didn't know even when it was going to adjust.



Was thinking of walking away. Vaguely.



I said, why not move into the condo, and let the house go? More

affordable, perhaps (there's that maintenance bugaboo, however).

Oh, no, too small she says. People just have no idea of how bad

it can get.



Meanwhile the atty behind me represents developers, and he sez

that the banks have stopped funding some of the Miami towers and

that he thinks some of them will go for 10 cents on the dollar.



The judge said the plaintiff's attys are often just not showing up,

because they are so swamped, so if the defendents do show up

they don't get foreclosed for the time being, and the summary

judgment hearing has to be reset. The judge said she didn't want

them there, because her motion calendar would go on foreever.

If they've submitted the proper forms, she just signs the Judgment.



Sometimes they call in the afternoon.
 
so how far down the road does the foreclosure get rescheduled if the calendars are full? do you get another 6 months without paying?



do you think the bank will show up the second time?



do you think the banks might think it better to leave the former owner in place to guard their asset against destruction?
 
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