Wednesday, June 23, 2010

Mortgage Modifications, REO's, Short Sales and Distressed Commercial Properties

 You can win in 2010 !

Mortgage Modification is trending right now on Yahoo. com
so I feel it's a great time to post on the blog our services.

If you have a personal need for mortgage modification information
and services or you have a friend or relative you'd like to help
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The name of the company and mortgage mod service provider is
THE NEXT BLOG POST, Join, go to the back office and become an
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This will put your name into the system and we'll be getting with
you soon, with additional income streams and training. EAB

Tuesday, June 22, 2010






Please make sure to 

read my comment at 

the bottom of this article.

Will Mark-to-Market Finally Push Distress?

Last Updated: June 22, 2010 02:07pm ET
Welcome to the new face of real estate distress: after a deep recession, with the pain particularly acute in commercial real estate, there are still few viable distressed properties or notes available for sale. In short, the deals that are being done now entail investors, such as DiamondRock, chasing after defaulted borrowers to offer capital solutions.

The pickings are so slim that many investors who had originally thought they would pursue distressed opportunities are beginning to bow out, says Gary Eisenberg, a partner with Herrick, Feinstein. “Potential bidders would underwrite conservative offers and then find themselves losing by an order of magnitude,” he tells ”There is always someone willing to pay more, it seems.”

There are a number of reasons behind this situation, starting with government policies put into place to combat the recession, explains Bruce Prigoff, Partner with Cox Castle & Nicholson. The Troubled Asset Relief Program, for instance, propped up the banks so they could continue to exist without mass closures. Also, the FDIC has placed great emphasis in selling assets through a structured transaction format in which the agency retains a majority of the ownership interests in the loans of failed institutions, coupled with substantial ultra-cheap FDIC guaranteed financing to the venture that acquires the loans in partnership with the FDIC.

Those two developments are unlikely to shift in the foreseeable future. However, a third factor— bank loan accounting rules—will change.

At the start of the crisis, loan accounting rules were changed to permit banks to carve off portions of loans in an A/B Note restructure so that the portion of the loan that could be supported by current cash flow and was not too far under water from a valuation standpoint could be held by the bank as a modified performing loan, Prigoff explains. “This allowed the banks to retain large portions of their portfolios that otherwise would have been classified as nonperforming,” he says.

Now, the Financial Accounting Standards Board is proposing a change to the accounting standards that required banks to book loans at their current market value. The rules are not an immediate panacea—they won’t go into effect until 2013 for the largest banks and 2017 for smaller institutions.

But will their eventual arrival finally lead to the traditional or typical—or, at least, market-priced—distressed deals that opportunistic investors had originally been expecting? Don’t hold your breath, Prigoff advises. “The forces weighing against clearing the cloud over the real estate market through mark-to-market accounting remain very strong…regulatory pressure to move assets of the books of the banks is rumored from time to time, but is not having great effect at this time.”

The concept that the overall economy is going to improve sufficiently to outrun the collapse in the real estate markets and allow the US government and banks to avoid massive losses is the real problem, he says. “Also, continuing to hold most of the real estate loans on the books of institutions with a low cost of capital is designed to minimize the losses that would be incurred if the assets were shifted to investors that have a high cost of capital and high yield expectations. In a market where new financing for real estate assets is scarce, the cost of capital rises dramatically when an asset is moved off a bank’s books into the hands of a third party opportunistic investor, absent bank seller subsidized financing of the purchase. Accordingly, I do not anticipate a major change in US government policy that would bring large numbers of assets to market at this time.”

Integra Realty Resources’ president and COO, Jeffrey Rogers, says more patience is required on the part of distressed investors, some of which are beginning to disband funds set up for this purpose. “Memories tend to be short, but those of us who were around during the RTC days remember that the distressed assets did not begin to flow immediately. There was a process and it took years. This real estate downturn is different in many respects, but it still takes time before distressed assets are flushed through the system,” he tells

He also doesn’t think a change in mark-to-market accounting regulations will have much impact. “First, the proposed rules regulate when a financial institution has to recognize a loss on a loan asset. The institution is not force to sell the asset because it has lost value,” Rogers explains. “Financial institutions could still decide to keep the loans until they increase in value. They will certainly choose this option if the borrower is covering debt service.”


Posted by shortsaleprollc
Great insightful article. I have seen this trend, by my short sale
competitors which really are of no concern to us as our intention
is always to become the competition, not worry about it.

What this article tells me is it's time now for those of us that
chose to remain in these markets, which we sure in heck
intend to, is to start being surgeons instead of Mash units.
Earl Allen Boek Guild to Short Sale Wealth West Coast

I intend to raise a couple of hundred million for this effort.
We have already enjoyed some success in this field and
cannot wait to become a real factor in the short sale arena.
June 22, 2010 at 09:13 AM EDT

Thanks For The Visit.  We are looking for agents 50 states
To join us, learn short sales and commercial financing,
help us find and turn over your commercial short sales
to our experienced team of attorney and Phd economist.
just click here and join, no cost or information. Once
you do you'll be given further information on getting
started in your back office. We will be in contact if and
when you get that far.  Earl Allen Boek

Saturday, June 19, 2010

Brown Issues Warning about Rise of Short Sale Fraud | Jerry Brown 2010

Note: We are involved with a company that does residential Short Sale
and provides debt and mortgage mod services called Mortgage Mod
101. Those doing these transactions on behalf of our finder agents are
licensed and certified in the states they provide services. All fifty to
my knowledge.

Although this blog is dedicated primary to short sale COMMERCIAL
projects I posted our California Attorney General's Warning to
homeowners here as a public service. Lots of good info at this link,
including who in California to report to if someone scams you using
any of these methods.     EARL ALLEN BOEK

Wednesday, June 2, 2010


Mortgage foreclosure program on the rocks

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The Intelligencer
The Bucks County Mortgage Foreclosure Diversion Program has worked with hundreds of clients since August but the outcome of that assistance is unclear.
A program that aims to stem the tide of residential mortgage foreclosures in Bucks County by helping homeowners negotiate with lenders has served more than a quarter of residents targeted in a foreclosure action since July.

However, a lack of funding and dedicated staff for the program have prevented the accurate tracking of outcomes in those cases and may imperil its future as foreclosure filings continue to rise.

The Bucks County Mortgage Foreclosure Diversion Program was created at the urging of legal aid and credit counseling agencies last August. In an order by President Judge Susan Devlin Scott, lenders who file foreclosure actions in Bucks County court are required to participate in mediation with homeowners.

Homeowners are notified of the program when they receive a foreclosure notice and urged to call a hotline where they are referred to legal aid and credit counseling services if they are financially eligible. Unlike Philadelphia's foreclosure diversion program, which requires both homeowners and lenders to sit down and talk, Bucks County's requires homeowners to opt in.

"I think an opt-in program is much more suited to Bucks County. I think people in Bucks will take responsibility to do it for themselves," Scott said, noting that when a person is invested in the outcome of mediation, it is more likely to succeed.

"You can't just have something handed to you. I think you have to have a commitment," Scott said.

Out of 1,992 foreclosure actions filed in Bucks County Court between July and April, 516 defendants have taken advantage of the program at least to the point of scheduling conferences with attorneys for the bank or mortgage company. In 418 cases, conferences were actually held, but the outcome of many cases is unclear.
Marie Runkle, a judicial secretary who administers the diversion program, said the volunteer mediators who oversee the negotiations are not required to report the nature of a settlement and the court orders filed to withdraw a foreclosure action do not list a reason.

Runkle, whose responsibilities include secretarial duties for the county's senior judges, said the court lacks the manpower to conclusively track the outcome of each case.

Douglas R. Praul said the court has sought a grant through Congressman Patrick Murphy's office for the last two years. The request was denied in 2009 and the court's 2010 application is still pending.
"We are trying as best as we can to give the back office support to keep this program going on a very limited budget," Praul said. "We're taking people out of their regular jobs to keep this thing going."

Praul said the court did discuss the possibility of additional funding from the county for the foreclosure diversion program.

"The decision was that we would do what we did until they could find money to support additional people," he said.

Although the program is scheduled to end at the close of the year, the timing was based on a projection that mortgage foreclosure rates would decline.

Recent data indicates the number of foreclosure filings is continuing to rise. The number has climbed from 186 in July to 231 in April with only two dips in November and January.

"If the grant doesn't come through, I don't know how much longer we can limp along," Praul said.
According to the Bucks County Sheriff's Office, in the first five months of this year, 251 homes have been sold at sheriff's sale - the ultimate result of foreclosure actions where efforts to intervene are absent or fail. In comparison, 160 homes were sold at sheriff's sale during January through May 2009.

Barbara Lyons, a Doylestown attorney who said she has served as the mediator in more than 300 cases, told the Bucks County Commissioners in a presentation last month that only 11 cases filed since July have proceeded into foreclosure. But because a homeowner has avoided foreclosure doesn't mean that they will be able to stay in their home.


"We would encourage everyone to at least see if they qualify or there is some loan modification program that can keep them in their homes," Lyons said.

But in some cases, a homeowner who is unemployed or underemployed and has no immediate prospect of increasing his or her income simply does not have the money to pay a mortgage. In those cases, lenders are willing to work out an alternative to foreclosure, Lyons said.

"Rather than the homeowners being evicted with the sheriff at the door, they're saying we'll work with you to sell the home," Lyons said. "We're seeing some very realistic and compassionate folks on the lending side of the table."

Mortgage companies will allow homeowners to stay in their homes while they list the property for sale and in some cases allow the owner to sell the property for less than the balance of the loan.

In many cases, Lyons said, even when the homeowner loses his or her home the process itself provides a degree of relief.

"Even though they don't get what they wanted, they are heard and they know they've done everything they can do," she said.

Paula Powers, a counselor with the nonprofit Credit Counseling Center in Richboro, said about half of the cases in which she has provided credit counseling for homeowners in the foreclosure diversion program have resulted in an alternative to a sheriffs sale.

Some lawyers who have represented homeowners in the mediation process said that while the program is valuable because it forces lenders to listen to homeowners, many lenders appear unwilling or unable to reach resolutions that keep homeowners in their homes.

Josh Goldblum, a Philadelphia bankruptcy attorney, said many banks aren't set up to handle the number of loan modification applications they are receiving.
"Everyone is limited by the ability of the mortgage companies to make adjustments," he said.

He added that any adjustment that the bank agrees to is voluntary.

Jeff McCullough, a Doylestown attorney, said the inability of mediators to require loan modifications makes the process one of forestalling the foreclosure.
"There is no doubt that the program is slowing down the process of foreclosure. Is it achieving permanent loan modifications? I haven't seen it yet," McCullough said.
But Ersula Cosby, a Langhorne attorney, said the goal of the program should not be to keep everyone who faces foreclosure in his or her home.

"It is delaying the process of foreclosure and it's giving people a chance to get things together and work things out. So in that sense it is helpful," she said.
Michael McKeever, a Philadelphia attorney who represents lenders in foreclosure actions, said most lenders are willing to accept a delay of three or four months to give a homeowner a second chance. McKeever said banks would prefer to avoid foreclosure because they don't want to become responsible for properties.

When homeowners lose their homes in a sheriff's sale or simply walk away, the house becomes a liability susceptible to falling into disrepair, vandalism and other illegal activity, McKeever said.

He acknowledged that loan modifications are not the most common outcome, but he added that when a homeowner does secure a modification, it is because the diversion program has simply improved communication between the parties.
"Let's have the discussion, figure out what we have in common and see if we can resolve it based on that," McKeever said.

Peter Hall can be reached at 215-345-3067 or

June 02, 2010 02:41 AM