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The Housing Market in Review: Top Stories Week of December 12

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The stories we picked for the week of December 12. Two warnings; no-cost mortgages and loans, and defective LP or ABT trimboard products. Unhappy Republicans, advise to strategic defaulters and more on foreclosures.

Zillow reported the value of homes dropped in October 2011, the forecast for 2012 is…

Compared to the fall of last year, where rates reached more than 0.8 percent in depreciation, thisyear the drop has stabilized around -0.2 percent to -0.3, but the market is nonetheless headed towards a bottom for 2012 of up to another 2 to 4 percent drop.

No-cost mortgages: If it Sounds too good & looks too good to be true, it usually is

They may seem very attractive, but compare a standard mortgage with closing costs and a “no-cost” mortgage with no closing costs. Yes the standard mortgage has closing costs, but it’s a one time payment and then it’s over. With the no-cost mortgage, the extra one-half to three-quarters of a percent rate will cost you $17,000 over the life of a $100,000 mortgage.

What happened to mortgage Aid; mortgage investors & servicers with personal motives

“The administration’s programs were hampered by design flaws; their reliance on a mortgage industry. Mortgage investors unwilling to surrender profits and mortgage servicers with sometimes greater financial incentives to foreclose on loans than to permanently modify them.”

OCC on the defensive because of consultants used for foreclosure cases

The Office of the Comptroller of the Currency (OCC) is criticized for the notification letters sent to 2 million borrowers thus far who are potentially eligible for review. It is estimate that more than 4 million borrowers may be eligible for review. Due to servicer error 22 examples of borrowers suffering from financial harm have been presented.

WARNING to homes with potentially defective LP or ABT trimboard products

A National initiative is launched to find homes what were built with the following products called Louisiana Pacific’s, or ABT Building Product’s TrimBoard, ProTrim, or ChoiceTrim that may be potentially defective. Any homeowner who notices swelling, decaying, rotting, or delamination from these products should Contact Construction Defect Center.

Foreclosure Crisis: The Story So Far. Get The Facts in a Nutshell

“Systemic failures at the country’s banks and mortgage servicers have exacerbated the most severe foreclosure crisis since the Great Depression, and government efforts to limit the damage have fallen short.” Why; robo-signing and GMAC posers plus errors, delays and lost documents within the HAMP program and indifferent servicers to mention just a few.

You’re damned if you do and damned if you don’t.

“OK, you walked away from that mortgage. Feels good. It should, you owed $400,000 on a $200,000 home. The problem is, you didn’t walk away from your mortgage. You walked away from the collateral. You still owe the money, minus the collateral, plus interest.”

Lets be clear, what’s covered and what isn’t, and what you really need.

What’s covered: your home, other structures on your property, like a garage, fence, driveway or shed. Not covered: a home business run in a separate structure on your property. Covered: personal effects, Not covered: high value items. Replacement Cost Vs. Fair Market Value? Items specifically purchased for car use?

Newly appointed FHA Head Carol Galante seems to lack a sense of urgency

To add to the already existing state of the Federal Housing Administration’s financial health, there is concern over the Obama administration’s choice for the new FHA head, Carol Galante. The FHA backs nearly $1.1 trillion in mortgages! Are Republicans right to be concerned?

Christopher Joy of Raleigh, North Carolina is suing Nationwide Trustee Services and Litton Loan Servicing for allegedly misleading the court in order to foreclose on him. When the two mortgage companies merged, he was notified his mortgage would increase $1,000 per month.

As for the last story we hope next week will bring many more. Thanks for reading!