Len's Blog

ShortSale scam

Len Malena - OC Realtor (ZipRealty) — Mon, 23 Nov 2009 19:50:05 -0600

This is just an amazing story that fellow realtor Frank Bellardo posted a few days ago;

http://realestateandthings.blogspot.com/2009/10/short-sale-alert-must-read.html

Basically, IndyMac Bank (now OneWest Bank), is holding clients hostage, demanding a promissory notes, or they will proceed to foreclosure. For the life of me, I couldn’t figure out why they were doing this. What advantage could there possibly be for them to proceed to foreclosure?

Yesterday, I figured it out. You see, IndyMac was taken over by the FDIC and sold to OneWest Bank in March/2009. Guess who the investors are behind OneWest? George Soros, Michael Dell, Steve Mnuchin (former Goldman Sachs executive), and John Paulson (hedge-fund billionaire).

Now, listen to the deal they got from the FDIC….

Basically, they purchased all current residential mortgages at 70% of par value (70% of the outstanding loan amounts). They purchased all current HELOCS at 58% of Par Value!!!

Next, in order to “sweeten the pot”, the FDIC stepped in and guaranteed the following: For any residential mortgages where OneWest experiences a loss, the FDIC will step in and cover anywhere from 80%-95% of the loss. The loss is calculated using the ORIGINAL LOAN BALANCE, not the amount that OneWest paid for the loan. Let’s use my clients situation as an example:

if the Loan Amount is $478,000, plus 6 months of missed payments, for a grand total of $485,200. OneWest pays $334,600 for the loan. We have an all cash offer of $241,000, net to OneWest. So, let’s do the math, shall we?

The net loss, according to the FDIC formula is the ORIGINAL LOAN AMOUNT minus the amount of the offer. In this case, $485,200-$241,000, or $244,200. Next, the FDIC, according to their Loss Share Agreement, writes a check to OneWest for 80% of the so-called “net loss”. So, in this case, OneWest gets a check from Uncle Sam for $195,360 (.80 X $244,200).

Add the $195,360 to the sales price of $241,000, and you get a grand total of $436,360. Remember, OneWest paid $334,600 for the loan. So, OneWest puts $101,760 in their pocket, thanks to the FDIC. Folks, that is over $100k of our hard-earned tax dollars!

So, you ask…Why does this program hurt short sales? Because, our brilliant government offers this SAME PROGRAM FOR FORECLOSURES! The only difference is, the government picks up 80% of the tab on all of the extra costs associated with a foreclosure (BPO’s, upkeep, utilities/maintenance, legal fees, etc.)

So, If I’m OneWest, why would I want to waste my time negotiating through a Short Sale, when I can make the same amount of money (if not more) by just letting it go to foreclosure? And we wonder why nobody can get a Loan Modification? Why would OneWest approve a loan modification for this guy, when they can foreclose and make over $100k? And, to add injury to insult, they have held this loan for 6 months! Not a bad ROI, huh?

What infuriates me the most is that in my particular case mentioned above, they have the guts to hold my client hostage for a $75k promissory note, after they are already making more than $100k on the sale!!! This is his primary residence, 1st Position loan, and OneWest has NO RECOURSE! Imagine if they could make $100k, then get a deficiency judgement! Talk about making some big bucks!
Can you say “GREED”?

The scary thing is that over 50 banks have Shared Loss Agreements in place with the FDIC. Some of them include: Bank of America (go figure), CitiMortgage, Wells Fargo, etc.

This entire agreement between the FDIC and OneWest can be found here, on the FDIC website. It’s all there, for the world to see! They have it all layed out. All of the formulas, worksheets, etc.

Now, it’s up to us to bring it to the attention of our elected officials and the media. Enough is Enough!

Wait, it gets better…The FDIC just announced that it needs to start borrowing money from the U.S. Treasure in order to replenish it’s deposit insurance fund (the same fund being used to pay all of these banks in the Loss Share Agreements). Go Figure! –

FB

OC home prices to increase 11%

Len Malena - OC Realtor (ZipRealty) — Fri, 20 Nov 2009 10:51:18 -0600

From today's OC Register;

First American CoreLogic’s computers say …

Orange County homes prices, in the year ending September 2010, will appreciate 10.94%. Last month, First American projected a 9.53% annual again for year ending August 2010.

http://lansner.freedomblogging.com/2009/11/20/oc-home-price-seen-rising-109-in-year/44869/

I've been seeing a steady increase in upward pricing pressure though many buyers don't want to belive it.

Homebuyer Tax Credit

Len Malena - OC Realtor (ZipRealty) — Sat, 14 Nov 2009 16:48:40 -0600

This month, Obama signed into law an expanded Homebuyer Tax Credit bill, which extended the deadlines and added a new $6,500 credit. Several provisions in the bill became effective immediately. Homebuyers who owned their primary residence for five out of the last eight years can claim the $6,500 tax credit for purchases made after November 6th. In addition, the extended income limits in the bill are now applicable for both first-time homebuyers and repeat homebuyers. The extended income limit for couples filing jointly is now $225,000, with the credit phased out over the next $20,000 in income. These new limits cannot be applied retroactively to deals completed before November 7th.

Loan Limit Extension Passed!

Len Malena - OC Realtor (ZipRealty) — Sat, 31 Oct 2009 13:40:03 -0500

The House and Senate moved quickly to pass an extension of the $729,750 GSE loan limit through the end of 2010, hoping to avoid any potential disruption in the mortgage market. Both chambers cleared the loan limit extension late Thursday as part of a continuing funding resolution. President Obama is expected to sign the continuing resolution (CR) shortly. The maximum $729,750 loan limit for Fannie Mae, Freddie Mac and Federal Housing Administration loans in high cost areas will expire at yearend, dropping to $625,500. The CR extends the higher loan limits through December 31, 2010. The CR also extends the nationwide $625,500 loan limit for FHA-insured reverse mortgages through December 2010. "Given the lack of a private secondary mortgage market, FHA, Fannie Mae and Freddie Mac are pretty much the only game in town," said Robert Story, chairman of the Mortgage Bankers Association. "Extending the current loan limits, along with other initiatives will help restore stability to the housing and mortgage markets." VA loans were not included in the extension. The Department of Veterans Affairs already has the authority to guarantee single-family loans with a maximum loan balance of $729,750 through December 31, 2011.

ZipStimulus and the Tax Credit - Ending Soon!

Len Malena - OC Realtor (ZipRealty) — Sat, 12 Sep 2009 10:26:33 -0500

September 10, 2009

Orange County, CA – Housing Market Update for August 2009

	Year to Year Comparison
Month	Aug-2008	Aug-2009	% Change
% Sold Price to Asking Price	96%	97%	1%
Sold Homes	2,511	2,302	-8%
Listing Price Per Home	$ 579,504	$ 546,570	-6%
Sold Price Per Home	$ 555,701	$ 530,769	-4%
Sold Price Per Sq Ft	$ 316	$ 302	-4%
MLS Days On Market Per Home	70	76	8%

	Month to Month Comparison
Month	Jul-2009	Aug-2009	% Change
% Sold Price to Asking Price	96%	97%	1%
Sold Homes	2,617	2,302	-12%
Listing Price Per Home	$ 566,704	$ 546,570	-4%
Sold Price Per Home	$ 546,437	$ 530,769	-3%
Sold Price Per Sq Ft	$ 304	$ 302	-1%
MLS Days On Market Per Home	73	76	4%

Talk with a local Orange County Real Estate Agent. Search for homes and condos in the Greater Los Angeles area. Search for homes in Orange County . Read detailed neighborhood profiles in Orange County, CA. These numbers reflect single family (SFR) and condo homes only. All numbers are from the MLS and are deemed reliable but not guaranteed as of 9/8/09.

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Orange County - Housing Update for April 2009 (ziprealty.typepad.com)
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Garden Grove Foreclosed house draws 135 offers

Len Malena - OC Realtor (ZipRealty) — Mon, 06 Jul 2009 22:41:36 -0500

In three days, 135 buyers had entered bids. By the end of the week, a deal was signed for $501,000 — $115,000 over the asking price.

The bank wanted to move the four-bedroom, three-bathroom house quickly. So the listing company recommended that it be “aggressively priced” at $386,100.

So many bids come in after just the first day that agents set a three-day deadline for additional offers. Buyers were so eager, they overlooked the dated fixtures and the need for new paint and carpeting. Ten bids came in at more than $100,000 above the asking price. The highest bid was $525,000. The weakest offer? A low-ball bid of $380,000.

About 25 of the buyers were willing to pay cash. And the bank ended up picking the highest all-cash offer to avoid the need for a loan appraisal that, if it came in too low, could hold up the deal.

I have access to REO's, ShortSales, Equity sellers and homes not on the market yet.

Len Malena

949-459-6752

Looking to buy or sell Orange County real estate?

Len Malena - OC Realtor (ZipRealty) — Sat, 13 Jun 2009 13:00:29 -0500

Whether you already live in the Orange County area and are simply looking to relocate, or you're new to town, moving from another city or state all together, Orange County Real Estate Authority can help you find and compare real estate in every community. Search Orange County real estate by MLS listings, find a real estate agent, and determine the value of Orange County area homes right here.

You'll also find detailed descriptions of more than fifty individual communities in and around Orange County and the Central Valley, all with average housing and property costs, statistics on neighborhood schools and school districts, as well as information on what the community has to offer in terms of recreational and cultural activities. Orange County is composed of a variety of neighborhoods and communities, all of which offer their own unique styles and amenities. Deciding where to live is not always easy, but Orange County Real Estate Authority can help you find your ideal home in your ideal surroundings.

Orange County, CA Real Estate

http://www.orangecountyrealestateauthority.com

Home buyer tax credit can be applied to purchase costs

Len Malena - OC Realtor (ZipRealty) — Thu, 04 Jun 2009 16:48:35 -0500

U.S. Dept. of Housing and Urban Development (HUD) Secretary Shaun Donovan recently announced that the Federal Housing Administration (FHA) will allow home buyers to apply the administration's new $8,000 first-time home buyer tax credit toward the purchase costs of a FHA-insured home. The American Recovery and Reinvestment Act of 2009 offers home buyers a tax credit of up to $8,000 for purchasing their first home. Families can only access this credit after filing their tax returns with the IRS. Home buyers using FHA-approved lenders can apply the tax credit to their down payment in excess of 3.5 percent of appraised value or their closing costs, which can help achieve a lower interest rate.

Currently, borrowers applying for an FHA-insured mortgage are required to make a minimum 3.5 percent down payment on the purchase of their home. Current law does not permit approved lenders to monetize the tax credit to meet the required 3.5 percent minimum down payment, but, under the terms of the announcement, lenders can now monetize the tax credit for use as additional down payment, or for other closing costs, which can help achieve a lower interest rate.

http://money.cnn.com/2009/05/29/real_estate/tax_credit_as_downpayment/index.htm?postversion=2009060109

Interest Rate Increases - Home Affordability!!

Len Malena - OC Realtor (ZipRealty) — Sat, 30 May 2009 11:50:29 -0500

In general, the amount you can afford to spend on a home is a combination of your cash on hand, your salary, and your outstanding debt.

For your specific situation, please visit ZipRealty's affordability calculator to see how much you can afford to spend on a home. This calculator is a free, anonymous service, which asks you for basic salary, savings, and debt information.

http://www.ziprealty.com/calculators/showcalc.jsp?calc=home01

A sound financing plan will help you approach the home-buying process with confidence, and will greatly improve your negotiating position in the transaction.

ZipRealty.com Named a Top Site in Webware 100

Len Malena - OC Realtor (ZipRealty) — Wed, 27 May 2009 12:43:14 -0500

Site: ZipRealty.com
Category: Commerce

ZipRealty is an online real estate agency. A survivor of the late 1990s dot-com bust, ZipRealty gives users home listings and values across more than a million homes. Home owners can also list their home right on the site, and have ZipRealty help sell it. When sellers do that there's usually a lower commission charge than they'd get from local real estate agencies.

The site also features a price tracking tool to search homes with reduced prices, and a tool that tells you what your home should be worth based on its size, amenities, and the recent values of other homes in your area.

We are thrilled to announce that Webware, a CNET site, has recognized ZipRealty as one of the top 10 Commerce websites
with its Webware 100 award!

The 2009 Webware 100 Awards recognize the best Web 2.0 sites, services and applications on the Web today. 
More than 6,000 nominations were made, narrowed down to 300 finalists. Then, more than 600,000 votes were cast 
by the Web 2.0 community, and our clients and fans voted us as one of the best!

You can see the full list of winners here: www.webware.com/100

Orange County Home Prices are on the Rise April 2009

Len Malena - OC Realtor (ZipRealty) — Tue, 21 Apr 2009 13:53:57 -0500

Home Prices are on the Rise


According to a recent Market Watch article, the shift in the housing market that we've all been expecting has finally happened: home prices are on the rise for the first time in a year.  

That means that if you're thinking about buying a home (and I know you are!), it may be better to act sooner, rather than later. There are a lot of fantastic homes in your price range that I'd love to show you - just let me know of a good day and time, and I'll happily set up viewing appointments. 

Read the full Market Watch article here:
http://www.marketwatch.com/News/Story/home-prices-rise-first-time/story.aspx?guid=%7B2B492854-BF5F-48A5-ADD4-355555D5BD2D%7D




ZipRealty continues to rise – we’re now a top 10 brokerage!

Is this the Bottom? Lake Forest foreclosures launch bidding war

Len Malena - OC Realtor (ZipRealty) — Thu, 02 Apr 2009 14:46:48 -0500

From today's Register;

Realtors say they can't write offers fast enough to keep up with the demand for foreclosed homes.

Investors and first-time buyers are finding a plethora of inventory priced below $500,000.

"There are multiple offers outbidding each other," said one Realtor, "I recently wrote an offer $50,000 above the asking price and was the 26th agent in line. They didn't allow me to put the offer in."

I think I hear the bell!

Vote for ZipRealty.com - A Webware 100 Finalist!

We need your help! We are a finalist for CNET's Webware 100 awards. The Webware 100 Awards honor the people's choice in Web apps--the best sites and services chosen by you. The winners are chosen by public voting. Please vote for ZipRealty here! You can vote as many times as you'd like until voting closes on April 30, so vote now and vote often!

With your help, we can ZIP to the top of the charts!

$8,000 from Obama + 20% from ZipRealty!

Len Malena - OC Realtor (ZipRealty) — Thu, 19 Mar 2009 15:51:44 -0500

As a first-time buyer, you could qualify for a tax credit of 10% of the
price of your new home, to a maximum of $8,000. There was a similar
tax credit passed last year that needed to be repaid, but this one
does not!

A few key points about this 8,000 tax credit:
• It's designed for most first-time homebuyers who have made a
qualified home purchase in 2009.
• The credit begins to phase out taxpayers according to their adjusted
gross annual income.
• This tax credit is temporary, so if you're thinking about buying a
home, it's important to act quickly.

Combined with ZipRealty's 20% rebate2 and historically low interest
rates, you could be looking at some serious savings on your first home
purchase if you buy this year.
Everybody's tax situation is different and we strongly encourage you to
speak with your personal tax professional to decide if this program is
right for you.

Just a quick note to let you know that you can now search for foreclosed
properties at ZipRealty.com.

Unlike other foreclosure sites out there, all of the foreclosed properties on
ZipRealty.com are currently listed for sale, rather than simply showing that the
owner has defaulted on their mortgage. ZipRealty's foreclosure listings
also include the information you want and expect from our site -- details on the
home, maps, photos, etc. Sometimes "foreclosure only" sites have very
little information on the properties, or how you can see the inside.

Best of all, ZipRealty doesn't charge a monthly subscription fee -- and if you
buy with me you'll get 20% of ZipRealty's commission back!*

Sincerely,
Len Malena

ZipRealty March Newsletter

Len Malena - OC Realtor (ZipRealty) — Mon, 02 Mar 2009 14:46:24 -0600

Real Estate News | Len Malena | ZipRealty

March 2009

View My Profile

Common Mistakes Homeowners Make When Selling Their Home
By Amy White
Most people believe they know everything there is to know about selling their house. They sign a contract with an agent, hold an open house, and wait for those multiple offers. But some common misconceptions about the whole process could be hurting their odds of receiving an offer. Improve your own odds with a bit of knowledge.

Myth: People are buying your house, not your furniture. You might be selling only four walls and... Read More

Tips to Avoid Mortgage Insurance
By Susan M. Keenan
First time homeowners looking to keep their monthly costs down should try to avoid private mortgage insurance (PMI) when buying a home. After all, this added cost could defeat the purpose of shopping around for the lowest interest rate for mortgages, the lowest APR, and the fewest chargeable points. Don't spend money on something you don't need or want.

Avoiding Private Mortgage Insurance is... Read More

New First-Time Homebuyer Tax Credit!

The recent $787 billion economic stimulus bill includes an $8,000 first-time homebuyer tax credit. If you are familiar with the $7,500 tax credit for last year, the new $8,000 tax credit is similar, but with some improvements; the tax credit doesn't have to be repaid, the home purchase date has been extended, and there is a $500 increase in the credit amount. It's not a big change, but for those ready to buy, the new tax credit is an added incentive. Here are the... Read More

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Search homes with reduced prices

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Caring for Indoor Plants
By Gail Kavanagh
When you've no room for a garden, but you love natural beauty like flowers and plants, houseplants are the solution. Keeping plants healthy and fresh indoors need not be a tricky business. It's a matter of position, moisture and pest control.

Position: Place your houseplant in a favorable spot. Some plants require a lot more light than others. If your plant looks lifeless and the leaves lose color and shine, it needs a sunnier spot. But a plant that starts to look shriveled with yellowing leaves probably needs more shade.

Talk to your plant supplier about the best conditions for your plant. Plants that enjoy sunny conditions in the garden will also appreciate a sunny spot... Read More

Tips to Upgrade Lighting
Courtesy of NewsUSA
When it comes to home decorating, lighting proves just as important as paint color. Quality lighting allows you to perform tasks without eyestrain and creates a warm, comfortable feel.

When lighting a room, remember that you will need more than one type of light. You will need to use general lighting, or overall illumination, and task lighting, which helps you perform tasks like reading or cooking without eyestrain. Many homeowners also use accent lighting to spotlight paintings, shelves or other areas of visual interest. Using all three types of light will help homes look more attractive.

The American Lighting Association offers these tips for Americans... Read More

Len Malena - 1-800-225-5947 x 4390

March 2009

ZipRealty, 2000 Powell Street Suite 300, Emeryville, CA 94608
The material in this publication is provided for your informational purpose only and is not intended to substitute professional advice.
If your property is currently listed with a Real Estate Broker, this publication is not intended as a solicitation.
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Home Buyer Tax Credit now $8,000!!!

Len Malena - OC Realtor (ZipRealty) — Wed, 18 Feb 2009 11:09:17 -0600

Great news - the Federal Government just enacted a new tax credit of up to $8,000 to help you buy your first home! 
Combining this tax credit with ZipRealty's 20% rebate means you could be looking at some serious savings on your first home purchase.
However, this tax credit is temporary, so it's important to act quickly.

Here's some more info about this tax credit:

http://www.ziprealty.com/taxcredit2009


There are several homes that have recently come on the market that you may be interested in, 
and I'd love to show them to you at your convenience - just drop me a line or give me a call.

Sincerely,

Len Malena
LMalena@ziprealty.com
949-459-6752

Why You Need A Real Estate Agent

Len Malena - OC Realtor (ZipRealty) — Sun, 15 Feb 2009 20:11:23 -0600

Whether you're buying a new home or selling your existing property, working with a licensed real estate agent will ensure that your transaction is handled quickly, efficiently and with a good end result.

A real estate agent can either be a buyer's agent or a seller's or listing agent, depending on their client's need. Although a single agent may list property for sale and also work with buyers, each role will be a little different. To understand why you need a real estate agent and what your agent should do for you, let's take a look at each agent type.

Buyer's Agent

When you're ready to buy a home, getting help from a real estate agent will expedite your search. Your buyer's agent represents your interest during the entire real estate transaction and will work hard to make sure you get the best bang for your buck.

Your realtor is an absolute asset when it comes to researching available homes for sale. He should have geographic knowledge and neighborhood familiarity, along with school information and other insider info. He will also have a network of related professionals to assist you in completing your real estate transaction, including mortgage lenders, title companies and inspectors.

When you are ready to make an offer on a home, your realtor will generate the paperwork to present to the seller and will negotiate on your behalf until you are either satisfied with the terms of the sale or are ready to continue looking.

Once your offer is accepted, your real estate agent will help navigate each step in the closing process.

In short, your buyer's agent will walk you through each step of the buying process while handling more details that you could ever imagine.

Seller's Agent

When you're ready to sell your home, finding a listing agent is the first step toward success. Your listing agent will evaluate the market and help you price your home accordingly. He will also make suggestions for improving the exterior and interior of your home to make it more appealing and saleable.

Your agent will list your home for sale on the Multiple Listing Service and get the word out about your home to other agents. She may hold an open house for other agents and host events to attract potential buyers. Like a buyer's agent, your seller's agent should have neighborhood familiarity, school information and other insider info to share with prospects.

While marketing and selling your home, your realtor will accentuate the positive aspects of your property and downplay its shortcomings. He will ceaselessly show your home and stay in constant communication with you. And when an offer is made on your home, your realtor will provide experienced advice on whether to take the offer, submit a counter-offer or reject the offer completely.

When a legitimate offer is made on your home, your real estate agent will show her true value by negotiating every detail to your advantage. At this point, you should have enough faith in your agent to trust his recommendations regarding the close of your sale. And then, put the paperwork in your realtor's hands.

Although some homeowners do put their house on the market for sale by owner, paying the associated fees to have a professional realtor handle your sale makes a lot of sense in today's competitive market and litigous environment.

The Bottom Line on Real Estate Agents

As you can see, the role of a buyer's agent and a seller's agent are distinctly different, yet their paths intersect with each real estate transaction. Whether you are buying or selling, a professional real estate agent will be your ally from start to finish. ZipRealty provides home buyers and sellers with an innovative solution. ZipRealty has streamlined the real estate process and is able to pass significant savings to its clients.

Call Len Malena at 949-459-6752 ( or LMalena@ziprealty.com) to discuss your real estate needs.

Hot Orange County foreclosures selling almost instantly!

Len Malena - OC Realtor (ZipRealty) — Mon, 09 Feb 2009 14:04:19 -0600

South OC foreclosures are selling almost as soon as they hit the market. Market time has dropped to about 1 month. Most foreclosures, (REO's) are realistically priced and buyers are not getting the massive discount they think they can, usually there are multiple offers within a few days of hitting the MLS and websites like www.ZipRealty.com And many are selling above list price!

Just in todays OC Register, according to Steve Thomes of Altera, demand is running 70% above a year ago!

ZipRealty Hiring!!

Len Malena - OC Realtor (ZipRealty) — Thu, 05 Feb 2009 17:46:26 -0600

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	Benefits and Compensation ZipRealty offers a winning package, with compensation AND potential benefits! Learn more

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The Real Estate Closing Process

Len Malena - OC Realtor (ZipRealty) — Tue, 06 Jan 2009 14:04:20 -0600

Real Estate News | Len Malena | ZipRealty

January 2009

View My Profile

The Real Estate Closing Process
By Melissa Nykorchuk
While most of the real estate transaction process is fairly straight forward, many homebuyers are often concerned about the actual closing process. When a buyer and seller agree to a real estate contract, a closing date will be scheduled and a title company will be assigned to manage the paperwork. It is during this closing meeting that the funding for the property and the title to the property are exchanged. When purchasing property, it is important to become familiar with... Read More

Energy Tax Credits in 2009
By E. E. Kane
Trying to decide whether to invest in new energy-efficient home improvements? Tax credits can put those improvements affordably in your reach, after deductions and lower energy bills. However, there are a few things you need to know before you make a purchase or sign a contract.

The IRS granted credits for improvements made during 2006-07, but not 2008. This applies for all but the most expensive improvements... Read More

During Cold Season, Treat Kids with Care
Courtesy of ARAcontent
Many families rely on over-the-counter oral cough and cold medicines to help sick kids feel better, but we can never be too careful when caring for our kids.

To ensure that these medicines are used and stored safely, the "Treat with Care" campaign reminds parents:

•	Always follow the label exactly and use the measuring device that comes with the medicine.

•	Do not give a medicine only intended for adults to a child.

•	Prevent unsupervised ingestions by keeping all medicines out of the reach and sight of children.

•	Do not use antihistamine products to make a child sleepy.

•	Consult a physician or healthcare professional with questions.

For more information, visit OTCsafety.org.

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Quick Kitchen Cabinet Updates
By Sherry Holetzky
The kitchen is called the heart of the home for a great reason; prospective buyers have been known to fall in love with a home simply because it has an attractive kitchen. Since few homebuyers are prepared to tackle a full-scale kitchen remodel when they first buy a home, they scrutinize the overall condition of the kitchen during their home tour. If they don't like what they see, the rest of the house isn't likely to win them over either. If you want your home to be appealing to homebuyers, update your kitchen before listing your house for sale.

The most noticeable part of the kitchen is the condition of the kitchen cabinets. Although it may not be wise for you to invest in completely replacing your existing cabinets when you are preparing your house to sell, it is certainly beneficial to give them a facelift. If your cabinets aren't in the best... Read More

Ideas to Keep Upbeat in a Down Economy
By Angela Baca
Is your local TV news full of stories about people losing their business or their home? It is not easy to miss widespread media coverage of troubled families and the failing economy. It was even the focus of the 2008 presidential election. What matters most to you is what you are doing to respond to the economic problems while you continue living your life. Here are a few ideas for fighting the sour economy one day at a time.

1. Make a budget and stick to it. You can find thousands of ideas on the Internet on how to save money in your household budget. Design a budget plan that works for your family. After you've got a plan, sticking to it is your key to fighting your economic situation.

2. Get back to family time. Having less spending money gives you more quality time to stay home with your family. If you can accept your present economic situation, you can focus... Read More

Len Malena - 1-800-225-5947 x 4390

January 2009

December Newsletter

Len Malena - OC Realtor (ZipRealty) — Thu, 04 Dec 2008 12:45:47 -0600

Real Estate News | Len Malena | ZipRealty

December 2008

View My Profile

Despite Tighter Lending,
Buyers Still Benefit
By Melissa Nykorchuk
With the recent government bailout of Fannie Mae and Freddie Mac, mortgage lenders are finally showing responsibility in their lending practices. Potential homeowners will find it tougher to get a mortgage than in recent years where a loan could be secured with no down payment, a subprime credit score, and no income verification. As lenders tighten their approval process, fewer homebuyers will be getting in over their financial heads. Buyers that can meet the new criteria for... Read More

The Recent Interest in
Real Estate Short Sales
By William Payne
Lenders are facing a liquidity dilemma as the number of foreclosures continues to rise. As a result, more banks and other financial institutions are becoming amenable to a short sale by the borrower to prevent the property from becoming a real estate owned asset.

What Is a Short Sale?
A short sale means that the lender has agreed to accept the proceeds from the sale of a piece... Read More

4 Ways to Shop Smarter for Your Home
By Angela Baca
When it comes to buying things for your home, you want to make a smart investment and save money over the lifetime of your home products. Use these four tips as a starting point for doing your research before you buy.

1. Research which appliances are truly energy-efficient. Many brands can make this claim, but some appliances are better engineered than others. You can look for online reviews of products from independent sources to carefully select an appliance.

2. Research warranty and service plan options. When you purchase a home product such as an.. Read More

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5 Tips for Happy Holidays
By Sherry Holetzky
It's easy to get so caught up in planning the perfect holiday that all of the fun is lost. The following tips will help you keep things happening and happy.

Shopping Issues
With the many recalls currently in place, shopping for children can be stressful and difficult. However, you can look for toys and other products made from natural materials and natural dyes. While some of these may cost a bit more, safety is worth the higher price tag. Also, consult with local shops and find out about handmade or other specialty toys that use high-quality materials. You may just find that you prefer quaint little shops to the madness of toys stores for holiday shopping... Read More

Be Safe When Preparing
the Holiday Meals
Courtesy of ARAcontent
The holiday season is here, which means preparing for yummy feasting, the gathering of friends and family and shopping for all the food. Turkeys, hams, homemade salads and fruity desserts are all waiting to be whipped up and consumed.

But along with the popularity of preparing holiday food at home comes the threat of food illnesses. According to the Centers for Disease Control and Prevention, more than 200 known diseases are transmitted through food, and foodborne diseases are estimated to cause up to 9,000 deaths each year in the United States.

"Food safety is everyone's responsibility, particularly when preparing and serving holiday delectables," says Dr. Roger Clemens, a spokesman... Read More

Len Malena - 1-800-225-5947 x 4390

December 2008

Real Estate Market Forecast 2009

Len Malena - OC Realtor (ZipRealty) — Sat, 15 Nov 2008 20:50:05 -0600

Join us as we celebrate $1 Billion in real estate sales.

ZipRealty, Inc. will be hosting:

Real Estate Market Forecast 2009

Keynote Speaker: Gary Watts, Economist
Host Presentation: Pat Lashinsky, CEO ZipRealty

Tuesday December 2, 2008 Where is the Orange County Real Estate

9:00am – Noon market going next year?

Hyatt Regency Irvine In these challenging economic times

Main Ballroom what will home sales look like in 2009?

17900 Jamboree Road
Irvine, California 92614

Registration is Complimentary for Licensed Real Estate Professionals. *Registration is required. Limited seating available.

Click here to Register Online

http://www.ZipRealty.com/OCMarketForecast2009

How AIG's Collapse Began a Global Run on the Banks

Len Malena - OC Realtor (ZipRealty) — Sat, 11 Oct 2008 20:45:28 -0500

This is an outstanding explanation of our current credit crises by Porter Stansbury;

What follows is one of the real secrets to September's stock market collapse. Once you understand what really happened last month, the events to come will be much clearer to you... Every great bull market has similar characteristics. The speculation must - at the beginning - start with a reasonably good idea. Using long-term mortgages to pay for homes is a good idea, with a few important caveats.

Some of these limitations are obvious to any intelligent observer... like the need for a substantial down payment, the verification of income, an independent appraisal, etc. But human nature dictates that, given enough time and the right incentives, any endeavor will be corrupted. This is one of the two critical elements of a bubble. What was once a good idea becomes a farce. You already know all the stories of how this happened in the housing market, where loans were eventually given without fixed rates, without income verification, without down payments, and without legitimate appraisals. As bad as these practices were, they would not have created a global financial panic without the second, more critical element. For things to get really out of control, the farce must evolve further... into fraud. And this is where AIG comes into the story.

Around the world, banks must comply with what are known as Basel II regulations. These regulations determine how much capital a bank must maintain in reserve. The rules are based on the quality of the bank's loan book. The riskier the loans a bank owns, the more capital it must keep in reserve. Bank managers naturally seek to employ as much leverage as they can, especially when interest rates are low, to maximize profits. AIG appeared to offer banks a way to get around the Basel rules, via unregulated insurance contracts, known as credit default swaps. Here's how it worked: Say you're a major European bank... You have a surplus of deposits, because in Europe people actually still bother to save money. You're looking for something to maximize the spread between what you must pay for deposits and what you're able to earn lending. You want it to be safe and reliable, but also pay the highest possible annual interest. You know you could buy a portfolio of high-yielding subprime mortgages. But doing so will limit the amount of leverage you can employ, which will limit returns.

So rather than rule out having any high-yielding securities in your portfolio, you simply call up the friendly AIG broker you met at a conference in London last year. "What would it cost me to insure this subprime security?" you inquire. The broker, who is selling a five-year policy (but who will be paid a bonus annually), says, "Not too much." After all, the historical loss rates on American mortgages is close to zilch. Using incredibly sophisticated computer models, he agrees to guarantee the subprime security you're buying against default for five years for say, 2% of face value. Although AIG's credit default swaps were really insurance contracts, they weren't regulated. That meant AIG didn't have to put up any capital as collateral on its swaps, as long as it maintained a triple-A credit rating. There was no real capital cost to selling these swaps; there was no limit. And thanks to what's called "mark-to-market" accounting, AIG could book the profit from a five-year credit default swap as soon as the contract was sold, based on the expected default rate.

Whatever the computer said AIG was likely to make on the deal, the accountants would write down as actual profit. The broker who sold the swap would be paid a bonus at the end of the first year - long before the actual profit on the contract was made. With this structure in place, the European bank was able to assure its regulators it was holding only triple-A credits, instead of a bunch of subprime "toxic waste." The bank could leverage itself to the full extent allowable under Basel II. AIG could book hundreds of millions in "profit" each year, without having to pony up billions in collateral. It was a fraud. AIG never any capital to back up the insurance it sold. And the profits it booked never materialized. The default rate on mortgage securities underwritten in 2005, 2006, and 2007 turned out to be multiples higher than expected. And they continue to increase. In some cases, the securities the banks claimed were triple A have ended up being worth less than $0.15 on the dollar.

Even so, it all worked for years. Banks leveraged deposits to the hilt. Wall Street packaged and sold dumb mortgages as securities. And AIG sold credit default swaps without bothering to collateralize the risk. An enormous amount of capital was created out of thin air and tossed into global real estate markets. On September 15, all of the major credit-rating agencies downgraded AIG - the world's largest insurance company. At issue were the soaring losses in its credit default swaps. The first big writeoff came in the fourth quarter of 2007, when AIG reported an $11 billion charge. It was able to raise capital once, to repair the damage. But the losses kept growing. The moment the downgrade came, AIG was forced to come up with tens of billions of additional collateral, immediately. This was on top of the billions it owed to its trading partners. It didn't have the money. The world's largest insurance company was bankrupt.

The dominoes fell over immediately. Lehman Brothers failed on the same day. Merrill was sold to Bank of America. The Fed stepped in and agreed to lend AIG $85 billion to facilitate an orderly sell off of its assets in exchange for essentially all the company's equity. Most people never understood how AIG was the linchpin to the entire system. And there's one more secret yet to come out... AIG's largest trading partner wasn't a nameless European bank. It was Goldman Sachs. I'd wondered for years how Goldman avoided the kind of huge mortgage-related writedowns that plagued all the other investment banks. And now we know: Goldman hedged its exposure via credit default swaps with AIG. Sources inside Goldman say the company's exposure to AIG exceeded $20 billion, meaning the moment AIG was downgraded, Goldman had to begin marking down the value of its assets. And the moment AIG went bankrupt, Goldman lost $20 billion. Goldman immediately sought out Warren Buffett to raise $5 billion of additional capital, which also helped it raise another $5 billion via a public offering.

The collapse of the credit default swap market also meant the investment banks - all of them - had no way to borrow money, because no one would insure their obligations. To fund their daily operations, they've become totally reliant on the Federal Reserve, which has allowed them to formally become commercial banks. To date, banks, insurance firms, and investment banks have borrowed $348 billion from the Federal Reserve - nearly all of this lending took place following AIG's failure. Things are so bad at the investment banks, the Fed had to change the rules to allow Merrill, Morgan Stanley, and Goldman the ability to use equities as collateral for these loans, an unprecedented step. The mainstream press hasn't reported this either: A provision in the $700 billion bailout bill permits the Fed to pay interest on the collateral it's holding, which is simply a way to funnel taxpayer dollars directly into the investment banks.

Why do you need to know all of these details? First, you must understand that without the government's actions, the collapse of AIG could have caused every major bank in the world to fail. Second, without the credit default swap market, there's no way banks can report the true state of their assets - they'd all be in default of Basel II. That's why the government will push through a measure that requires the suspension of mark-to-market accounting. Essentially, banks will be allowed to pretend they have far higher-quality loans than they actually do. AIG can't cover for them anymore. And third, and most importantly, without the huge fraud perpetrated by AIG, the mortgage bubble could have never grown as large as it did. Yes, other factors contributed, like the role of Fannie and Freddie in particular. But the key to enabling the huge global growth in credit during the last decade can be tied directly to AIG's sale of credit default swaps without collateral. That was the barn door. And it was left open for nearly a decade.

Is that a clear explanation or what? Seems so simple now. But we sure have a tough road ahead of us.

CountryWide Mortgage Help

Len Malena - OC Realtor (ZipRealty) — Wed, 08 Oct 2008 09:26:32 -0500

WASHINGTON - Nearly 400,000 homeowners will be able to get more affordable loans after Bank of America (BAC) agreed Monday to modify mortgages that originated with its Countrywide Financial unit.

The move could be worth more than $8.6 billion and mark the largest predatory lending settlement in history.

Monday's deal settles claims brought by attorneys general in 11 states that accused Countrywide — acquired in July by BofA — of misrepresenting loan terms, loan payment increases and borrowers' ability to afford loans.

Bank of America says it will restructure loans for Countrywide customers holding subprime mortgages and option adjustable-rate loans that permit borrowers to pay only a small portion of interest and principal owed each month. Some might wind up in new fixed-rate loans; others might not.

But the Bank of America deal represents only a fraction of the future defaults and foreclosures facing homeowners. There were more than 2.2 million foreclosure filings in the USA in 2007.

"There could be a couple million more (foreclosures to come), so it begins to put a price tag on the problem and how expensive it is," says economist Joel Naroff at Naroff Economic Advisors.

Pat Lashinsky, CEO of ZipRealty, says as many as 6 million homes will have gone through a short-sale or foreclosure before this housing slump is finished.

Under the terms of the agreement with Bank of America, eligible homeowners must occupy the home as their primary residence. Their mortgages must be seriously delinquent — or likely to become so. Loans must have been serviced by Countrywide and originated prior to Dec. 31, 2007. Modifications will include lower interest rates and principal reductions.

Short Sale & REO Listing Confusion

Len Malena - OC Realtor (ZipRealty) — Thu, 25 Sep 2008 17:39:46 -0500

Basics;

A short sale is a property that is being sold for less than the owners owe on it. In order for a short sale to come off, every mortgage lender and lien holder who holds a debt secured by that property must agree to forgive some or all of that debt. Short sales can, paradoxically, take many months to close, and many never do -- the list price can be bizarrely lower than the actual price the lenders will accept, and lenders can take up to six months to even say 'yea' or 'nay' to a short-sale offer. As such, many buyers and buyer's brokers avoid them like the plague.

An REO is a piece of real estate owned by the bank. These are homes that have gone all the way through foreclosure, and are now owned by the foreclosing institution. REO transactions have their own set of rules, and can be tumultuous, but they are generally feasible to get to close of escrow and sometimes provide a good deal for the buyer.

NOT a Short Sale or REO: In areas and at price points where the majority of properties are distressed properties, this notation advises you that you are likely dealing with an individual seller. This tips you off that you might be able to negotiate a broader range of terms than if you were doing a transaction involving a bank, and that your escrow will likely be a lot smoother than one with an institutional seller.

REO: Knowing that a property is an REO from the listing, you know that the seller is a bank or lender of some sort, that they will only sell the property in as-is condition, that documents may take days or even weeks to get the institution's signature, and that the escrow may take awhile to close. Also, the seller is very likely to have a strict addendum to your normal purchase contract that may change the normal terms of sale -- pay close attention to the terms of any such addendum. On the other hand, REO sellers tend to be willing to negotiate on price and to offer significant closing-cost credits and concessions.

S/S or Subj to Lender's Approval: All home-buying transactions are subject to the approval of the buyer's lender, but when a listing agent notes that a purchase is "Subject to Lender's Approval," it means that the property is a short sale and the approval of the seller's lender(s) will be required to move forward. Sellers' lenders withhold approval, most often, because they want a higher price, but can also withhold it on various grounds amounting to the fact that the lender feels the seller is not in sufficient financial distress to justify debt forgiveness.

Short sale already approved by lender: A very small number of lenders will "pre-approve" an amount at which they will agree to a short sale; other times, the property will have previously fallen out of escrow after the bank approved the short sale. Since the worst part of a short sale is obtaining the lender's approval, usually an approved short sale is less problematic than a traditional short sale.

No reports: This just means that the seller has no inspection reports to make available to prospective buyers; we see this notation often on REO properties.

As-Is/Where-Is: Virtually all REO sellers insist on selling the property in as-is condition, meaning the buyer must agree to accept the property in exactly the condition and location it is -- if it's got mold, you take it with mold. If it has an addition that is built over the neighbor's lot line -- you agree to take it that way, and to never sue the seller for any damages you incur as a result.

OC lenders slash mortgage rates

Len Malena - OC Realtor (ZipRealty) — Tue, 09 Sep 2008 15:26:11 -0500

Mortgage rates in Orange County plummeted this morning as markets reacted to Sunday’s news about the government takeover of the two largest buyers of U.S. home loans.

The rate on a 30-year fixed-rate mortgage up to the old conforming limit of $417,000 dropped as low as 5.375% with a one-point fee from 6% on Friday.

And the rate for a 30-year fixed-rate loan greater than $417,000 and up to nearly $730,000 fell to 5.75% with a one-point fee, down from 6.125%.

Of course the lowest rates go to people who meet today’s tougher underwriting standards, such as putting 20 percent down for a purchase or 10 percent and buying mortgage insurance.

Those of you that have been looking and looking, IT'S TIME TO BUY!!!

No telling how long these fantastic rates may last.

Len's Blog

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December Newsletter

Real Estate Market Forecast 2009

Real Estate Market Forecast 2009

Keynote Speaker: Gary Watts, Economist Host Presentation: Pat Lashinsky, CEO ZipRealty

How AIG's Collapse Began a Global Run on the Banks

CountryWide Mortgage Help

Short Sale & REO Listing Confusion

OC lenders slash mortgage rates

Keynote Speaker: Gary Watts, Economist
Host Presentation: Pat Lashinsky, CEO ZipRealty