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“After three months, nearly 36 percent of the borrowers had re-defaulted by being more than 30 days past due. After six months, the rate was nearly 53 percent, and after eight months, 58 percent,” said U.S. Comptroller of the Currency John C. Dugan. A report scheduled to be published later this month will show continued increasing delinquencies and foreclosures in process for all first-lien mortgages held by the largest national banks and federally-regulated thrifts, Dugan said.

You can read the report released 12/08/2088 HERE

Key findings of this report include:

* New loan modifications increased by more than 80 percent from January to June and increased by 56 percent from the first to second quarter. By comparison, new payment plans grew only 8 percent from January to June 2008, and increased just more than 2.7 percent from the first to second quarter. As a result, the mix of loss mitigation shifted toward loan modifications from the first to second quarter with the share of loan modifications increasing from 34.5 percent to 44.5 percent.

                                              First Quarter Total                  Second Quarter Total
Loan modifications          71,883                                          112,353
Payment plans                  136,367                                        140,155
Loss mitigation actions  208,250                                       252,508

* More than nine out of 10 mortgages remain current. However, credit quality declined during the second quarter across all risk categories. The overall percentage of current and performing mortgages in the combined portfolio declined from 93.35 percent at the end of the first quarter to 92.61 percent at the end of the second quarter.

* There were increases in early stage delinquencies (30-59 days past due) and seriously delinquent mortgages, defined as mortgages that are 60 or more days past due plus loans to bankrupt borrowers who are 30 or more days past due. Foreclosures also increased in the second quarter.

% of all Mortgage Loans in the Portfolio     End First Quarter 2008     End Second Quarter 2008
30-59 days delinquent                                                     2.57%                                  2.85%
Seriously delinquent                                                        2.67%                                  2.95%
Foreclosures in process                                                   1.40%                                  1.60%

* New loss mitigation actions increased more quickly than new foreclosures during the second quarter. Overall, new loss mitigation actions relative to new foreclosures averaged more than 87 percent during the second quarter, about 12 percentage points higher than the first quarter.

                                                                                                                  First Quarter 2008     Second Quarter 2008
Total number of new loss mitigation actions                                208,250                          252,508
Total number of new foreclosure actions                                       278,857                          288,740
New loss mitigation actions relative to new foreclosures          75.68%                           87.45%

My Comments:

ASK ME WHY I’M NOT SURPRISED. From what I have seen so many buyers are so far underwater on their homes with respect to equity and paying so much more than they can afford that any loan modification is little more than a stop-gap measure that simply delays the inevitable: FORECLOSURE.

		Direct: Fax:		559.301.1647 559.438.7475
1319 W Bullard #4 — Fresno CA — 93711
© Randy “Lazarus” McAtee

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THIS IS A MUST READ ARTICLE describing how the Daily News ripped off the Empire State Building in 90 minutes using forged documents.  It highlights the huge potential for thieves to take advantage of a system that does no verification of information.

I believe that in the not too distant future we will see an entire industry developed to make sure your “REAL PROPERTY” is not stolen or tampered with, much like what we have today to protect ourselves from identity theft.

I had a gentleman contact me who wanted to sell some property he had and I looked it up on the tax records and told him that according to what I was seeing on the tax records he had transferred the property through sale earlier in the year.  It turns out a  family member had sold the property using bogus documents and notary.

Guess who the buyer was?  A REAL ESTATE BROKER –  who should have known that if the price was “too good to be true” there was probably something fishy going on.

		Direct: Fax:	559.301.1647 559.438.7475
1319 W Bullard #4 — Fresno CA — 93711
© Randy “Lazarus” McAtee

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Insight into the current mortgage crisis:

Where has all the money gone?

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I just received an email from one of my lenders and they say that for all future loans they will require a Form 4506-T.

Why?

LOAN FRAUD.

Last month they funded a loan and upon verification of information (which they did after the loan closed) it was discovered that all the employment the borrower gave the lender was FICTITIOUS.  Everything was fabricated by the borrower: the employer, the pay stubs, the W-2.

How people think they can get away with this kind of stuff is beyond me, but I suspect there are some who still do –  and under former lax lending practices there were probably MANY who did (manage to get away with this kind of stuff).

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Here’s what’s wrong with America.

Watch this video about a couple who lost their home to foreclosure and are now living in a campground and tell me if you hear what I hear.

recap:

The gal says they walked into that home and said “…. we can get this for $265,000 - NO MONEY DOWN? OMG!!!”

I’m going to make an assumption here. I will assume that they did, in fact, purchase the home with NO MONEY DOWN. Given that they bought the home during the height of loose lending that means their investment may have been no more than just the closing costs, BUT, the way they were making loans they may have been able to make the purchase with the closing costs rolled into the loan.

After they move in the home doubles in price and what do they do? Remember they had approx $265,000 in equity.

Are you following what I’m trying to say? Assuming they purchased the home with NO MONEY DOWN - they had little to NOTHING invested - and now they are cashing in on the equity.

OK - then the gal loses her job and they don’t have money to pay their bills ( including their house payment ).They try to sell the home and the sale falls through, so what do they do? They suck out more equity via an emergency loan from lenders who obviously realize these guys are up sh*t creek so its not like they are going to get great rates: THESE ARE HIGH RISK CUSTOMERS. In case you don’t know, lenders who make loans to people in their financial condition ASSUME they are going to be getting the home.

They way I see all they did was TAKE. What are they crying about? I mean if this guy worked all his life to make the down payment and/or put up his life savings to buy the home, that would be one thing, but I don’t see it that way. Everything that I saw/heard leads me to believe they got the home for no money down and used their home like ATM to take money out. Then when times got tough, they took MORE money out.

It ends with the guy crying and saying “it hurts, I didnt cause this to happen…other’s caused it, nobody cared, everybody just walked away.” I say HE IS THE ONE WHO WALKED AWAY. I have absolutely NO SYMPATHY for these crybabies. If anybody got screwed here, I think its the lenders. Folks, THIS is what’s wrong with America!

He NEVER really owned that home in Vegas, he just had legal title to the property. Miss 3 payments and you find out real quick who REALLY owns your home. I’m sure he does OWN that trailer.

_______

I have had this blog as a draft for a several weeks because before I posted it I wanted to know that I actually had the information correct. I email CNN and asked them to verify what I believed I heard and never received a reply. I did detect a discrepancy in the report regarding their payment. Bottom Line: If I am wrong as to my interpretation of events I will gladly stand corrected. If anyone has information to prove that these people actually made a down payment please let me know.

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Eventually things WILL turn around.  Who knows, we maybe we’re hitting bottom now?  It’s bizarre how interest rates dipped down to around 5.25% and so quickly rebounded.  Perhaps the banks were just testing to see where the market is.  I have to believe that at in the low 5% the banks were getting quite a bit of action.  Heck, at 5 %  I was thinking of refinancing!
Important to note that there is NO LACK OF MONEY TO LEND,  just as there is always more money looking for good deals than there are good deals to be had.   The money is there, and by historical measures its cheap, its just not as easy to get today because lenders are repricing the risks.

What does repricing the risk mean?

In layman’s terms it means the lenders are saying we will lend you the money if you show us:

You have a job

You have good credit

You have money for a down payment

Your debt to income ratio is in within guidelines

No one is making *NINJA loans these days!

*no income, no job, no assets

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…its the path of least resistance.

In my opinion the Federal Government and the loan industry would rather renegotiate all the funny money loans done over the last several years rather than investigate them — because if they did investigate they would find so many  perpetrators of fraud our prisons couldnt hold them all. 

DON’T LIE ON YOUR LOAN APPLICATION 

A broker called me this morning and asked me about doing a loan for guy he knows.   He recently sold two homes to this guy’s mother and now this guy would like my broker/friend to help him refinance his house.  He already has two homes financed under the auspices of being the owner/occupant and he wants to refinance another one as Owner/Occupant to get a lower rate.

The broker who did the other two loans for him tells him this is NO PROBLEM. However this guy would like my broker/friend (who sold his mom the two homes) to do the loan for him.  My friend asked my advice.

I told him its OK  to  say that he is going to occupy the property -even though he isn’t - so long as he and client are willing to go to prison.  

If you need to finance or refinance don’t even think about making false statements on your loan application.  Read the following: Don’t Be A Victim Of Loan Fraud

11. Be honest about your intention to occupy the house. Stating that you plan to live there when, in fact, you are not (because you intend to rent the house to someone else or fix it up and resell it) violates federal law and is a crime.

© Randy “Lazarus” McAtee 2007 
     Owner/Broker -  Lazarus Realty

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Howdy!

My name is Randy “Lazarus” McAtee. First off, folks ask me why Lazarus? Simple: Lazarus is the name I received when I was baptized (which happened to be on Lazarus Saturday) into Christ and the Orthodox Christian Church. Thus, Lazarus is my Christian name.

I am married to wonderful woman who is the mother of our six children: 5 boys, 1 girl. We are blessed with 5 beautiful grandchildren and still have 3 boys living at home with us. Speaking of home, we have lived in the same home in a great northwest neighborhood for nearly 20 years. I am a native Californian, born and raised in Marin County.

I’m a college dropout who is still wondering what I want to be when I grow up. Prior to marriage I was doing mission work in Mexico ( I do speak some Spanish amigo) and was a puppeteer. Marriage and the subsequent offspring forced me to get a real job

I have been a California licensed Contractor (in good standing with zero complaints and zero law suits) since 1988. My license classifications are B, C2, & D65 — which means I am a General Contractor with specialty licenses in Insulation & Acoustical, and Weatherization and Energy Conservation. My license # is 555829.

This is my 6th year in Real Estate and in May of last year I opened my own brokerage: Lazarus Realty. My license No. 01357881. I’d love to say something like ” I have a passion for Real Estate” or ” I really LOVE this business” but that wouldn’t be true. I DO like being a real estate broker. I don’t like it that public opinion of Realtors is low. But then again, from experience, I have a very low opinion of some of those who work in this field; on the other hand, I have met some really fine, upstanding people in this business that I have the utmost respect for.

I enjoy trading stocks and consider myself a micro-cap miner, i.e. I specialize in finding small companies with huge growth potential. An example of one such stock would be Spindletop Oil and Gas [ticker:SPND] which I started buying in 1998 at .18 per share. I sold the last of my shares at the beginning of this year at around $6.00 per.

I recently took up photography and many of the pictures on my site were taken by me. I currently shoot with a Nikon DX200 using a Nikkor 18×200 VR lens. It’s all the camera I think I will need for years to come. I do have some other lenses on my wish list. In the future I plan to have a photo gallery at www.finefotos.com .

In 2002 I got back in touch with my inner Puppeteer and built an entire Punch and Judy Theatre. I built the puppets, the props, the stage - everything- I even sewed all the little outfits myself. It took me 6 months. In 2006 I got frozen shoulder so until I regain my range of motion, I cant perform with puppets. In the mean time I am building a Flea Circus which is taking me far longer than anticipated. I authored and self-published a 16 page book about my distinguished troupe of fleas and you can read about it at the Flea Press (where one small mind itching to be heard lets the world know what’s bugging him).

During this market downturn I’m focusing on becoming more net-friendly. Many of my clients have been elderly people and hispanics with little or no internet exposure. I realize, however, that a large number of people, myself included, rely on the internet to identify prospective properties. SO - HERE I AM.

I hope that you will find some useful information on my blog. Whether your a friend, former client, prospective client, or a real estate agent feel free to comment or contact me anytime.

Lazarus - aka blogging broker

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