John's Blog

California Housing Investments... Where are we Now?

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sun, 19 Apr 2009 00:05:43 -0500

Top 10 Foreclosure Cities

Merced, California
Modesto, California
Stockton, California
Riverside, California
Detroit, Michigan
Fort Lauderdale, Florida
Cape Coral, Florida
Vallejo, California
Las Vegas, Nevada
Sacramento, California

As the first quarter passes the markets have still contunue to decline on stock markets worldwide, capital freeze, massive financial meltdown and layoffs from hundreds to thousands at a time. With trillion of dollar assets wiped out in the past year and IRA investments loosing what was to be an aid in retirment it seems that there is no end in site during these hard times.

Now you may have heard on late night television that the housing market is crashing everywhere and we are in a recession. And that is somewhat true, especially since 60% of the top 10 are in California. However, if this is absolutly true then why does Orange County hold well in the crashing market and curently why do we have bidding wars on properties?

No matter what we all will eat, go to schools and colleges/universities, supermarkets will still be open, buses will run and most people will want to but gadgets and spend beyond their means - just not as bad as before. It is often said that some of the most successful investments have been made by going against the grain, which means selling when most are buying and vice versa. And in this market, of foreclosures, going against the grain now would mean buying while others are selling. The goal during in recent years has been to buy now, sell quickly and pocket capital gains, abut not when values are falling or stagnant. The better option in hard times is to seek capital preservation and ongoing income.

Now, imagine that during the Depression era of the 1930's those who bought real estate at sunken prices and simply held on. The importance of such of experiences suggest that going for long term benefits is a logical and reasonable strategy for today market. And given that foreclosures are often available with significant discounts, it follows that they represent a good starting point in the search for long-term income and capital safety.

Here are 5 basic questions which can help you decide:

Can you get financing? When the rates are exceptionaly low and you go to a direct lender for a 30 yr fix, then when the market turns around for the better so will your investment.
Can you do your own repairs? This will help aid in the reduction of the overhead on your investment.
How's your local market? Is the inventory of unsold properties increasing? Are new home builders discounting units in established projects?
Find an experienced Pre-foreclosure Realtor in the county you are purchasing.
Can you afford vacancies if your renter cannot pay? If you don't have the income to support this investment then you may want to reconsider.

New Worm Infects millions of PCs

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Wed, 21 Jan 2009 19:21:24 -0600

A worm has infected over 3 million right away and may end up to 20 million PCs. What seems to be the culprit is USB drives. It's called either Down & UP, Down-a-Up, or Conficker. It works by tricking you by running the virus when you plug in a drive. Look closely at the screenshot above and you'll see two entries for "Open folder to view files." The one at the top is a phony entry that actually installs the virus. When installed the virus spreads like crazy via a separate flaw in Windows networking system and can quickly infect a whole office. Get your latest Windows Update to get that flaw patched up.

To avoid this turn off "AutoPlay/AutoRun" on your computer and if you have it then go to F-Secure and that should work.

Fannie Mae the LandLord?

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 17 Jan 2009 21:42:22 -0600

Now, Fannie Mae will be a landlord to some of the renters in properties foreclosed. Due to the current market the renter of the foreclosed homes have been stuck in the cross fires. Many states have been altering the laws to help them in their crisis by delaying the eviction process.

"Their new policy will apply to renters in single and multi-family homes, condos, co-ops and manufactured houses who are in place when Fannie Mae acquires the property. The tenants will be offered a new month-to-month lease which will require them to pay market rate rent but they will not have to post security deposits. And if the renter chooses to vacate the property instead, Fannie Mae will offer financial assistance for their move to other housing."

Here's the fine print though... the foreclosed home must meet state laws and local codes to be eligible for their program.

Don't Foreclose Short Sale your Home...

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 17 Jan 2009 21:35:07 -0600

NLM Processing can help you on your pre-foreclosure options. For the borrower(s) that are unable to maintain your mortgage payment(s)and need an option to avoid possible Foreclosure or worse Bankruptcy. Here are some hardships that may qualify for short selling a home and help your credit.

MORTGAGE RELATED REASONS FOR SHORT SELLING YOUR HOME

No Equity available to Refinance
Interest Rate Adjusted
Balloon is due
Huge Negative Amortization

PERSONAL RELATED REASONS FOR SHORT SELLING YOUR HOME

Loss of Employment
Loss of Secondary Income
Medical Related Issues
Divorce or Separation
Military Transfer or Deployment
Job Relocation

www.NLMloanmod.com

National Loan Modification - NLM - Who are We???

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 17 Jan 2009 21:13:06 -0600

Who We Are

We at NLM are processors that will push to get your loan modification through with an honest and upfront outlook so you know where you are at every step of the way. Either through proper processing and/or legally assisted negotiations our file will get the attention you deserve. You will not speak with a sales person but a person that actually worked on files from start to finish.

Our goal is to provide a fresh new start (and possibly stop a foreclosure) by modifying the terms of a existing mortgage. The common modifications are:

Fixing or Lowering the Rate / Returning the Original Rate (NEG-AM)
Absorbing Late Payments/Fees into the Loan

Let us see if we can HELP you...

www.NLMloanmod.com

The First 2 Banks to Fall in 2009

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 17 Jan 2009 21:04:12 -0600

Two banks have just fallen to start off the 2009 list. National Bank of Commerce of Berkeley, Illinois and Bank of Clark County of Vancouver, Washington. So the FDIC's final count for 2008 is 25 banks and 2009 is about to tie for the 3 in 2007. So Washington has not only lost Bank of Clark County but its big one as well, Washington Mutual. Well, at least the FDIC is currently insuring up to $250,000 per account through 2009.

Citigroup Splits to Two Divisions

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 17 Jan 2009 20:53:49 -0600

Citigroup plans to split into two units one will be a commercial and retail banking and the other is going to focus on brokerage, asset management, and their troubled assets. Citi has taken $45 billion from the government's taxpayer TARP, Troubled Asset Relief Program, funded which holds about $700 billion but is going down fast from other banks dipping their hands in it as well.

Citicorp is going to be the retail banking and credit card businesses, investment banking, Citi Private Bank

Citi Holdings will take the brokerage and asset management units for CitiFinancial and CitiMortgage

Bank of America asking for Fed Aid

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 17 Jan 2009 20:44:29 -0600

Bank of America is taking$20 billion in government aid due to obtaining Countrywide and Merrill Lynch. B of A received a second capital infusion from the U.S. government due to its $118 billion troubled recent purchase. Bank of America's lending division is suffered and having it's existing loans even causing issues. Even with their $8.54 billion fund for their bad loans they are still in need of help.

So now the U.S. goverment is thinking of setting up a government bank that would use federal funds to purchase the troubled assets from financial institutions.

2008 Foreclosures are up 81%

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 17 Jan 2009 20:24:25 -0600

2008 U.S. foreclosure filings are more than 81% which is 3.1 million filings. And 861,664 homeowners lost their homes to foreclosure on the steps of city hall. Even with the government aid to sponsor the mortgage Freddie MAC and Fannie MAE to suspended foreclosures from November 26, 2008 through January 31, 2009, December filings still out did Novembers for 2008. So I can imagine all of these aids are only a costly delay of the inevitable.

Cailfornia 2008's foreclosure filings are around 44,000 per month and with all of the law to help aid the homeowners is not showing any difference in these numbers. But only slow down the process of change that has to come sooner or later. Masschusetts and Maryland have the same ideas with the same stale outcome.

The top three states that the foreclosure monster bit out of the most is Nevada, Florida, and Arizona. California has some of the worst cities but it only puts them in the top 10.

Mortgage Rates Still Down

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 17 Jan 2009 20:01:22 -0600

Now going on the 11^th consecutive week that the interest rates are going down. The 30 year fixed is hitting 4.96% with 0.7 point from last weeks 5.01% with 0.6 point. 15 year is around 4.65% with 0.7 points. The 5 year Treasury indexed ARM, adjustable rate mortgages, dropped to 5.25% and 0.6 point. Wow, now we are hitting the 2006 rates for the ARMs...

Congress OK's the Release for the $350 Billion Bailout

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 17 Jan 2009 19:49:08 -0600

The $825 billion economic stimulus bill will be ready for Obama's signature sometime in February. With this new bailout cash for the falling financial industry, huge proposed spending, and tax cuts many this borrow and spend their way back to prosperity will be implemented like the borrowers that purchased homes with no consequences in mind. But it seems that the money will be available weeks after the signing. This feels like a refi...

The bill will tax cuts for businesses and individuals then placing billions into areas such as health care, education, energy and highway construction. This all translates to about $550 billion in new spending and $275 billion in tax cuts. The estimated "new spending" break down goes as following:

$130 billion for health care

$100 billion in funds to help homeowners facing foreclosure

$100 billion for education

$30 billion for highways

$10 billion for mass transit

$3 billion for airports

Billions for food stamps. unemployment benefits, and some other goverment aided departments

Obama asks Bush to request Congress for $350 Billion Financial Bailout

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Mon, 12 Jan 2009 12:50:04 -0600

Yes, you heard it. Barack Obama asked Bush to implement the release of the $350 billion financial bailout to be sooner than later. This request was recently confirmed by Dana Perino, the White House Press secretary. These are some of the things to help aid the transition from the Bush administration to the new Obama team.

Both presidential figures are working with Congress on how and went to release all of our money. With three different parties involved and most of their beliefs are different this may be interesting to see the time frame on this one. So by January 20 when Obama takes the office the money should be available but again that's only a projection. Now it seems that many have spoken against this bailout due to the financial institutions that are involved have not stepped up on rectifying their past errors.

Second Homes Tax Change as of 2009

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 03 Jan 2009 20:17:53 -0600

Effective as of 2009 Congress has altered the taxes on the profit of second homes... vacation homes and rental properties. Now under the current law, you could sell your primary residence and take up to $250,000 of profit and double that for a joint return ($500,000). Meaning tax-free as long as you owned and consistantly reside their for two of the five years leading up to the sale. After that you may move into your vacation home / rental property and by living in it for at least two years a tax free incentive may be in order with a possibility of profit that was built up while it was a vacation home or rental could be exempted by the IRS.

So you're thinking of leaving your home then what do you do with your current home? You could rent it to generate cash flow and buy some time before selling it in this slow housing market. The tightening doesn't apply in reverse so you could still qualify for tax free profit on the home as long as you sell it within three years to meet the two of five-years test. Again, see a CPA for more on this...

The aid to help pay for the big housing bill that was passed this summer had been brought to an end and Congress has changed the rules so that some of your gain will be taxable. That is if you converted your vacation home / rental unit to a primary residence after 2008. Part of the gains is to be taxed based on the ratio of nonqualified use. It's calculated by the time the property is used as a vacation home / rental unit after this year to the total amount of time you owned the property.

For example you purchased your second home in 2000 and then you moved into it as your primary residence in 2011 and sell it two years later. Now the home would be used as a vacation property for two years after 2008. So then 1/17th of the profit, two out of the 14 years you owned it, would be taxed at capital gains rates. The remainder of the gain, up to $500,000 for couples, would be considered tax free.

These tax law changes could be even more significant if you buy a second home after 2008. But no matter what you choose to do you must speak with a knowledgable real estate CPA to find out the best course of action for your situation.

Top 10 Foreclosure Cities/States as of November 2008

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 03 Jan 2009 19:46:51 -0600

Top 10 Foreclosure Cities and States as of November 2008

Top 10 Foreclosure Cities

Merced, California
Modesto, California
Stockton, California
Riverside, California
Detroit, Michigan
Fort Lauderdale, Flordia
Cape Coral, Flordia
Vallejo, California
Las Vegas, Nevada
Sacramento, Califonia

Top 10 Foreclsoure States

Nevada
Florida
Arizona
California
Michigan
Georgia
Ohio
Colorado
Utah
Idaho

IndyMac bought for $13.9 billion

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 03 Jan 2009 19:32:24 -0600

IMB Management Holdings LP and its group of investors signed an agreement to take over IndyMac Bank, the Federal Deposit Insurance Corporation this New Year. With their terms not being released at this time but the AP said it to be worth 13.9 billion and is to be finalized the the end of this month so said the FDIC.

Nicolas Cage Sells His OC Home for $35 million

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 03 Jan 2009 19:20:18 -0600

Just recently Nicolas Cage sold his Newport Beach, CA home for $35 million which he paid $25 million in 2005. The buyer is Jerry Herbst and 70ish year old owner/chairman of Terrible Herbst which runs gas stations and other retail operations.

So I guess the economy is not that bad if home of this magnitude are still selling...

A contemporary bay view home on Newport Bay which has a view of the harbor's main basin.

Several New CA Laws for the New Year...

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 03 Jan 2009 18:44:22 -0600

Some of the new California laws that may take for this year:

SWEEPSTAKE JARGEN TO CHANGE

This CA bill says that it will be banning misleading sweepstakes entry material designed falsly draw someone to participate by saying that they have been specially selected to participate in their drawing. Moreover it prohibits the sweepstakes sponsors from bait and switch their a fee to receive or obtain information about a prize.

HIGH SCHOOL AND COLLEGE NEWSPAPERS

The CA school administrators may be prohibited from retaliating against high school and college journalism instructors for refusing to censor student newspapers. This will make it illegal to dismiss, transfer, or discipline teachers for protecting their students free-speech rights.

CA 2 LAWS ON TEACHERS SEX CRIMES

The first law will make it tougher for teachers who commit sex crimes by allowing the state to revoke the licenses of teachers who plead no contest to certain sex crimes or drug offenses without waiting for a discretionary review that can sometimes take two or three years.

The second one allows the CTCC, California Teacher Credentialing Commission, to revoke a teachers licenses automatically if a previous criminal conviction has limited their contact with children.

ORGINS OF THE BOTTLED WATER

This legislation will require bottled water producers to reveal where they obtain their sorce of water, either on the bottle's label or on a package insert. Which is one step for the consumer to know seeing that the testing reports requirment are less strict then any government ran facility.

CLEANER PET STORES

This bill sets a higher standard for the care of animals sold in pet stores by requiring them to have their cages/place of storage to be cleaned frequently and that the stores be kept free of pests. Not this is sad that a bill was needed...

California Bans Texting While Driving

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 03 Jan 2009 18:05:51 -0600

Now California has a New Year's resolution for their so many driver that do everything but drive during their commute. Like 5 other states, Washington, Alaska, Louisiana, Minnesota and New Jersey, are also banning texting while driving.

Now the CA bill making it an infraction to write by sending or reading a text message while driving starts on the 1st of January 2009. Simitian's bill for texting while driving gives you a $20 fine for the first offense and $50 fine for additional violations, but of course it's all depending on what the officer will give or not to give... that is the question.

The ban on texting while driving is a follow up on the CA bill that took effect last July 1. It allows adult motorists to use only handsfree devices when talking on cell phones while prohibits drivers under age 18 from using any cell phone or electronic message device while driving.

"Cell phones has been an issue for 61 deaths and 3,489 injuries on CA roads & highways (2002 - 2007) according to the CAHighway Patrol. The CHP statistics does not reveal if the motorist involved was using the phone to talk or text."

John Kim

Loan Modification / Short Sale Processor

Average CA Foreclosure Timeline...

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 03 Jan 2009 17:34:20 -0600

These are based on the California conditions that the banks are not overwhelmed and will follow some sort of guidelines. More or less this is the minimum time frame...

30 Days of Delinquency: A Pre-Lien is issued and mailed to the borrower

60 Days of Delinquency: Lien is issued on the property by the loan servicer.

90 Days of Delinquency: Notice of Default (NOD) is recorded and certified mailed to the borrower. The defaulting property owner has 3 calendar months to cure, or payback the default amount.

Within 30 Days after the NOD: 2nd Notice of Default Certified Mailed

90 Days after the NOD: Trustee schedules a Trustee's Sale (auction).

21 Days After Notice of Sale: On the date of sale, trustee sells the property to the highest bidder. This sale is usually held at the trustee's office, or at the County Courthouse (call trustee for updates on time, date, place).

If Unsold:Property becomes an real estate owned (REO) and will be placed back on the market.

Your Credit Score in a Foreclosure vs. a Short Sale

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 03 Jan 2009 17:29:20 -0600

Know that sellers will take a bigger hit on their credit report by going through foreclosure than going thru a Short Sale. Of course paying you mortgage with a few late payments and modifying you loan is the best course of action, however that topic is for a different blog. FICO score may sway towards the following:

Foreclosure
A hit of 200 to 300 points may occur within the 3 different credit bureaus. This means if a seller's FICO score before foreclosure was 720, it could dip lower than 300. The seller has to also consider the initial dings from the lates caused prior to the end of the foreclosure.

Short Sale
The affect of a short sale on a seller's credit report is much less damaging. The ding on credit will show up as paid in full, some sort redemption status, or a few other different ways. But the result in the loss is about 60 to 140 points. This means a short sale with a previous FICO of 720 will see it fall to 500 to 600. However, with a true Credit Restoration you may be able to recover within months of closing your short sale.

Estimated Waiting Period Before Buying Another Home

Foreclosure
Now when the seller now becomes a buyer it will take about about 60 months before a lender will offer a rate that you may consider. Of course at a purchase price of half of what you may have bought prior to this. But now with the constant daily guideline changes the lending industry is experiencing rates may not be economical for the buyer. Moreover, with the new restrictions of the guidelines the cure time and consequences may be worse.

"The presence of a foreclosure on your credit report probably will make it extremely difficult to obtain new credit at the best rates, especially if you also have problems with other credit accounts. A foreclosure remains on your credit report seven years, so it will have a long-term effect on our creditworthiness."Experian - Credit Bureau

Short Sale
The good news for short sale sellers is that the wait is much shorter before buying another home. The same scenario as the foreclosure but in about half the time with a lot more ease in qualifying with the underwriter.

John Kim

What is a Short Sale???

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 03 Jan 2009 17:24:55 -0600

Short Sales, "short selling", "shorting", Short Payoff, Pre-Foreclosure Sale, or Comprmise of Sale happens when a lender agrees to accept less than the amount owed against the home because there is not enough equity to sell and pay all costs of sale. In a nutshell it is asking the bank for forgiveness and to let you go with just a slap on the hand.

Not all lenders will negotiate a short sale, and that is why a real estate agent can be a tremendous help by contacting the lender's loss mitigation department to find out. In the past I have witness the borrower being treated differently than that of a third party intervention.

You can't just wake up one morning and decide, "Hey I'm going to sell your home at a loss by asking for a short sale." Typically, lenders won't even consider a short sale unless payments are in arrears. Lenders will be more agreeable to negotiation if your payments are delinquent which is sad to say but true. Which I am not advising for one to be late on their payments. But just know your options so when your decision is made it will be a right one for you.

There are many other per-foreclosure options that you may qualify for but you have to inform yourself of all the option before make a decision. Visit www.NLMloanmod.com

Why Consider a Short Sale?

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 03 Jan 2009 17:20:15 -0600

For borrowers that are unable to maintain your mortgage payment(s)and need an option to avoid possible Foreclosure or worse Bankruptcy. Here are some hardships that may qualify for short selling a home.

MORTGAGE RELATED REASONS

No Equity available to Refinance
Interest Rate Adjusted
Balloon is due
Huge Negative Amortization

PERSONAL RELATED REASONS

Loss of Employment
Loss of Secondary Income
Medical Related Issues
Divorce or Separation
Military Transfer or Deployment
Job Relocation

www.NLMloanmod.com

LOAN MODIFICATION and Pre-Foreclosure Options - National Loan Modification

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 27 Dec 2008 16:57:19 -0600

The GOVERNMENT Stimulus Act of 2008 and "Hope for Home Owners" programs seem to be a solution for our current foreclosure situation... however most home owners CANNOT QUALIFY.

National Loan Modification - NLM may be able to HELP.

Processing your loan modification on your behalf and attempting to modify your existing loan with a modification that may reduce your balance, the rate, fix the term, or extend you existing one.

We are not a company that promises a false success rate and guarantee based on getting any type of loan modification that you could get on your own (read the fine print on their contract). What we guarantee is a service solely to help you. Not to pay for the heads of the company salaries, sales staff commissions, and whatever overhead that needs to be paid prior to your processing. We are the processors without the overhead you see in other pricings.

Call us to see if we can HELP at (888) 717-5565

National Loan Modification - www.NLMloanmod.com

PRE-FORECLOSRE OPTIONS - National Loan Modification

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sat, 27 Dec 2008 16:56:34 -0600

Are you a victim due to the Mortgage Crisis?

Do you owe too much money and can't sell?

Do you have no equity and can't refinance?

Did your mortgage adjust?

Are you facing foreclosure?

National Loan Modification can HELP...
We have Pre-Foreclosure Programs to Assist YOU

LOAN MODIFICATION
We can work with the lenders to lower your interest rate and payment, so you can afford your home.

SHORT SALE
We can help you sell your home, even if you owe more than the current value.

CREDIT RESTORATION
We can help you with creditor calls and restore your credit.

STOP FORECLOSURE AND SAVE YOUR CREDIT.
Call for FREE NO OBLIGATION consultation. CALL TODAY!

www.NLMloanmod.com - (888) 717-5565

SAVE YOUR HOME and CREDIT

John Kim (Orange County CA Loan Modification & Short Sale Processing) — Sun, 21 Dec 2008 00:06:58 -0600

Don't Let the Bank Take YOUR HOME and Ruin YOUR CREDIT!

Call to see if you can save your home and credit.

Call (888) 717-5565 to see if you can STOP

the bank from FORECLOSING on YOU!

www.NLMloanmod.com

(888) 717-5565

I have no interest in purchasing or transfer the deed of your home to me. My services are to offer you options in trying to save your home such as a loan modification. I'm here to aid you with your loan modification with the lending company so you can live your life without this stress. Again, if you wish not to lose your home and are looking for options consider call me for a FREE consultation.