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Fed's Release New Short Sale Guidelines. 12.07.09

Fed's pressure banks to short sale vs. foreclose and release new short sale guidelines. Find out how to take advantage of the new GFE. Shirmeyer tells us what to expect this week.

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SoCalApprs2: (December 09, 2009 1:20pm)

The more I read about HVCC, the more it needs to just go away. There is nothing good about the major banks being able to select AMC's. What is good is we the people get to select the Realtor, Broker and Appraiser. Period. We the people, not they the banks.

CornerstoneKathy: (December 09, 2009 10:46am)

Interesting..just heard from Cuomo's office?? what a cliffhanger!!

David Haynes: (December 09, 2009 9:20am)

Thanks for the hard work Frank & Brian!!!! If I don't see your video in the morning, I'm not awake until noon. Before CNBC, Bloomberg TV or any other news channel I watch TBWS. Keep up the good work. (or as Lloyd Blankfein would say “god’s work”)...

brian tbws: (December 09, 2009 8:42am)

Hey guys we just got back from NAMB Vegas. Great stuff going on. Franks on the phone with NAMB lobbyist regarding ysp and I just heard from Cuomo's office. Thanks for hangin with us.

David Haynes: (December 09, 2009 6:44am)

So. Where is Frank & Brian?? It's been two days....

HVCC: (December 08, 2009 1:55pm)

This totally makes sense Phil, takes for posting this about HVCC and why lenders do not accept appraisals from other lenders. What a shambolic law this has been, as the consumers have been getting ripped off again and again by HVCC. Jesus this makes my blood boil

Phil: (December 08, 2009 10:19am)

Back to HVCC. Just heard from AMC directly while trying to transfer/convert/switch (whatever) an appraisal to another lender why it's not readily accepted. The banks have separate COMMISSION STRUCTURES with each AMC and therefore in some cases won't release or accept "transferred" appraisals as they may not make the same amount of money from using that other "lenders" appraisal. Interesting to finally hear the truth although we've always known it centers around money rather than the quality of the report and/or the protection of the borrower. Wait until RESPA changes go into effect 1/1/10. Banks will not stop until TPO's are gone. Doesn't anyone on here know of a decent attorney that can look into a class action law suit as this is a no brainer.

Danny Flucke - NaMoEx.com: (December 08, 2009 8:43am)

Short Sale vs Foreclosure questions? Really? Maybe this will clear it up. The banks get short sale subsidies from the US Treasury - NOT on foreclosures. On foreclosures the banks assume all property related debt (utilities, taxes, HOA, insurance, potential injuries, etc) - NOT on short sales. The only real questions is why did the banks push foreclosures in the first place - When common sense tells you a short-sale is better for the banks bottom line. (DO NOT take this as an endorsement of the short sale bailouts - This is simply a statement of fact.) Thanx, Danny

Frank Garay: (December 08, 2009 5:19am)

Looks like the next Daily will get out on Thursday due to travel. We've got some interesting info for you! Have a killer day!

loannetter: (December 07, 2009 4:35pm)

The 'WHY MODS FAIL" question sound to me like banks are using TARP to cover their butts so they don't have to turn them over to long term lower rates...they just have to pretend. While using our TARP money they are screwing consumers. Making promises and then retracting them? Holy cow. Write your Congress bods www.congress.org

clulessdad: (December 07, 2009 3:45pm)

Bonwriter-I am surprised that they just haven't hired their own real estate personnel to SELL the properties. After all, they can control the appraisal, loan, and real estate commission. I believe that is their end goal anyway.

Bonwriter: (December 07, 2009 3:41pm)

It seems to me that banks could hire unemployed realtors and appraisers to speed up their acceptance of buyer contracts to purchase short sale homes on the market. Why wouldn't they want to see these homes get sold quickly? It would benefit the buyer, realtor, banks, and market in general.

clulessdad: (December 07, 2009 2:06pm)

Bryan-These banks are so arrogant- and the government is fueling their arrogance.

Bryan AZ HOME RUN: (December 07, 2009 1:26pm)

I am an agent in Arizona for 10 years and actively work short sales on a daily basis. I can say that it is nice to hear you & others promote that banks are wanting to do short sales BUT, this is not the attitude of the major financial institutions. Example: Wells Fargo on Friday told me yet again "WE ARE DOING FINE AS A BANK… WE DON’T NEED TO DO HORT SALES”. This was a warning and threat that they are, yet again, going to possibly foreclose on another seller. The problem is this: The banks take major losses with Short Sales. During a foreclosure, the banks reduces the loss to zero by pulling TARP and splitting the loss with the FDIC and or Fannie Mae. When they sell the property after the foreclosure, the banks shows a gain of whatever the property sold for. THIS MUST BE STOPPED BEFORE BANKS WILL ACTIVELY WORK SHORT SALES. The banks say this but are delaying the SS and stalling the foreclosure date to make it look like they are working on them when they are closing 1 of 20.

loannetter: (December 07, 2009 12:45pm)

12:39 loannetter: Bank of America just rejected a modification that was in trial for 5 months and we verified their paperwork was returned by certified mail. What gives? Do they realize they are setting up borrowers to fail? Now that this person has been paying a lower payment they are behind 5 months...about $5K so at this point they only have 30 days to cough up. I am recommending they complain to the State Attorney General while their modification agent (licensed LO) calls them to find out what is going on. Has anyone else experienced this?

TBWS: (December 07, 2009 11:53am)

I cant log into TBWS? anything wrong today?

GFEOKBYME: (December 07, 2009 11:48am)

I re-read my post. I was actually referring to the fact that it was going to weed out and remaining non-professional brokers, not that the remaining brokers are not professional. My company allows me to broker and 70% of my stuff gets sent to different lenders based on pricing, speed and make sense UW exceptions. I know there are lots of proud bankers and brokers in here, not trying to piss anyone off, just saying I think it's a good thing in general.

GFEOKBYME: (December 07, 2009 11:41am)

The New GFE actually does a good job of weeding out any of the remaining non-professional brokers and if the right hand in washingon knows what the left one's doing, it SHOULD eliminate the need for the abolishment of YSP's. I can't wait for the webinar.

Maja: (December 07, 2009 11:29am)

GFE is in links and docs to right under FDIC...SCROLL DOWN

chris: (December 07, 2009 11:25am)

Where is the link to sign up for the 12/10 webinar on the new GFE ?? I could not see it in links and docs

No Spin: Just the Facts: (December 07, 2009 10:13am)

Here is another example why we should not be pushing for the creation of Consumer Financial Protection Agency (CFPA) as an avenue to eliminate HVCC. The CFPA is more anti-Broker propaganda. What is a an abusive YSP? What is HUD's empirical data on abusive YSP vs. abusive SRP? They must have data on each if it is an issue. Has anyone seen it? FROM HUD: The creation of a Consumer Financial Protection Agency would ensure that loan brokers have a vested interest in the performance of mortgages they facilitate, according to HUD secretary Shaun Donovan. The CFPA could end "abusive" yield spread premiums and impose a "duty of best execution" on brokers to make sure they put borrowers into affordable mortgages," the Department of Housing and Urban Development secretary told a Consumer Federation of American conference. In addition, the broker's fee could be paid over time, instead of in a lump sum at the closing table giving brokers "skin in the game" the secretary said.

LarMo: (December 07, 2009 9:26am)

Loved the "Housing Bubble" jab. I stopped following the other service for that very reason. Too expensive AND felt I could no longer trust the advice.

FormerPackerFan: (December 07, 2009 9:20am)

Dweebster: No, you have to log in to tbwsratealert.com and go to the mbs page to get that. I leave it open all day and the browser tab always has the most recent trade on the 4.0 coup so I really don't even need to view the page unless all hell is breaking loose and I want to watch it. The reason I took rate alert over MMG is the alerts are totally user defined. I got mine dialed in to where I beat Provident all the time unless they're are hedging or something wierd. I feel like a sales rep but just sign up and you'll see how it works. GO VIKES!

ThePhoenix: (December 07, 2009 9:09am)

No question lenders and the administration promote short sales but what is in it for the seller? They still have to provide a ton of financial paperwork (be careful of the 3 years tax returns they are setting you up for fraud and filing a SAR on you... they don't need it for any other reason), they are still tanked credit wise as the short sale shows an acceptance for less than owed which is just as bad as a foreclosure, and the seller exits the home sooner than a foreclosure in most cases and they would not have had to make payments during that time. Many lenders require the seller to be obligated unsecured for their losses, thereby setting them up for a potential bankruptcy filing or garnishment of wages. Further, deficiency laws may be circumvented (California in particular). All these programs are really intended to benefit the financial institutions and Wall Street and have nothing to do with protecting consumers. That will change... it did in the 1930's.

Loanwise: (December 07, 2009 9:08am)

Uggg with the SHORT SALES! Some (yes only Some) Realtors list them without regard to actual value and comps. Then, they take offers for two or three weeks...Until, what do you know, they have their own offer that is $50,000 less than another offer that is all cash from an outside Real Estate Agent. Hmmm, which one does the Listing Realtor take????? Morals, Ethics and doing the right thing be damned. Taking the double ended deal will pay them double. This is the sickness in the market and is what is continuing to drive down prices. While they are trying to get the short sale done, there is a "pending sale" on the Multiple Listing Service that is $50,000 lower than all other comps. Then, what is the appraiser supposed to do about value on the next purchase? Short Sales are the AIDS of this market. Ban them. At least when a foreclosure is done, the bank does some level of diligence to determine value and they accept the highest and best offer.

clulessdad: (December 07, 2009 8:57am)

Fo all my mortgage broker friends-I spoke with a nice young lady at the Wash DFI about my license renewal Friday. Two years ago they were processing over 2000 applications/renewals for mortgage brokers. For 2010, they are looking at only 180 renewals. They actually had a Commission meeting about the industry, and they attribute the lower numbers to "over regulation." They truly get that Washington DC has gone too far and decimated the industry.

GODLIKE: (December 07, 2009 8:52am)

I had no idea there was anything in that box except the 2 items that were visible. I'll be, it does scroll! Ya learn something new every day!

Dweebster: (December 07, 2009 8:48am)

I have a rate alert questions. If I subscribe to one of the levels of Rate Alert service can i get the "TBWS MBS Tracker" for my website that appears to the right of the video on the daily show page?

Fossil: (December 07, 2009 8:38am)

By the way I have no skin in the game over MMG, LTB, Marshall or any of them. Never bought any of the products because I thought they were reckless with what they were empowering some of my own originators to do. I'm an aggressive marketer but I had to put the brakes on the marketing efforts and plans of 2 mid-level producers after they came back from Vegas a few years ago just to avoid potential liability. Thankg God I did. I do pay 250 per year to Rate Alert and absolutely love it. Might go mobile if anyone has any advice on the merits of this upgrade, I am curious, do any of the rest of the Executive members in here READ David Shirmeyers lock advice commentary? It's loaded with info and his opinions are hilarious. He's more funny that Frank & Brian half the time.

SmackDaddy: (December 07, 2009 8:04am)

maybe even thousands. i remember that whole movement, and it was going strong. interesting point being brought up here today.

Anonymous: (December 07, 2009 8:03am)

You're right Fossil. They burned hundreds of people with their strategy for sure.

Fossil: (December 07, 2009 7:41am)

C Dog I respectfully disagree that it was a cheap shot by TBWS. I didn't not see the ad they were referring to but Barry Habib, MMG, Steven Marshal and the whole crowd of yesterday's "sales leaders" in my opinion were second only to the rating agencies as being responsible for the meltdown. Oh let's teach LO's to get clients to cash out to 100% and invest in more real estate and then have them give speeches to Realtors and offer them scripts to help them get buyers into 100% stated deals. Great wealth building strategies they offered right? I think what they did borders on criminal and I am surprised they never got a class action over any of it.

C-Dog: (December 07, 2009 7:28am)

The bubble comment was an MMG thing.. Barry said there was no bubble back in the day. Kind of a cheap shot by TBWS, but I guess MMG took one at them, so it looks like a "tit-4-tat" kind of thing.

Frank Garay: (December 07, 2009 7:22am)

God Like - you have to scroll down in the links and docs box and click on the GFE logo..

Fossil: (December 07, 2009 7:11am)

GODLIKE: (December 07, 2009 7:07am)

You mentioned the Dec 10 GFE seminar, you even told us how much it costs, but you didn't tell us where it was or how to register.

I don't get it: (December 07, 2009 6:50am)

Tony C: What was the whole bubble comment about? I wasn't in vegas back in 05 I guess.

Tony C.: (December 07, 2009 6:47am)

REORealtor. Interesting point, I had no idea they made so much more when foreclosing. But my opinion is that collusion and steering among title companies, lenders and pre-selected realtors needs to be the next thing TBWS goes after. Love the work they've done on HVCC. This would be interesting for them to run videos on. Just my opinion. Gotta run, flying to mentreal for Christmas! Will check in from there. Good job Frank and Brian.

REORealtor1: (December 07, 2009 6:38am)

Uhnfortunately, the statement that the servicing companies make more money if they foreclose is true. After the foreclosure they are paid a monthly management fee as well as their title companies do the closings as well as they make 1-2% on the sale! Why would they want to do a loan modification? As an REO Realtor our company frequently gets assignments (just foreclosed)with a buyer, the seller, the selling agent and the listing agent all totally broadsided, thinking that they were getting the short sale approved. Sad. States need to enact banking laws to stop this from happening. Then, the REO Realtor gets the listing in and it's for 10-30% less than what the short sale would have brought in!! The foreclosure attorneys are unresponsive, take too many files and have a vested financial interest in foreclosing as they often get the title work. In the mean time the investor is also getting screwed when the loan is foreclosed and they get less money plus pay out all the management fees!

Tony C.: (December 07, 2009 6:34am)

Bet I know who the other alert source was. In 2005 I remember a tall dark haired guy telling me there was ho bubble with some line about unemployment and you should remind buyers its smart to buy when others fear and fear when others buy. Meanwhile i was watching mls inventories skyrocket! You must have heard the same speech.

GaryP: (December 07, 2009 6:32am)

I think that we have decided to continue to use the old GFE, in addition to the new one, if for nothing else, informational purposes for our borrowers. After all, the new GFE does not provide the two pieces of info that all borrowers want to know, payment and cash to close. In my opinion, it only provides the info that some bureaucrat in DC thinks a borrower should want to know. Remember the old saying, "Beware of the man who says, I'm from the government and I am here to help you."

Frank Garay: (December 07, 2009 6:03am)

We're up and about in Vegas... Got some good info for tomorrows show... Ah Vegas.... my head is killing me.

Links & Docs

Video Poll

Do you think the banks will embrace the administrations call to short sale vs. foreclose?