Daily Archives: April 28, 2015

Homestead exemption won’t protect owner from nonjudicial foreclosure

Question: What is a homestead exemption, how much is it for and what does it do? My sister owns a detached single-family home in a common interest development and has a homestead exemption. She told me to do the same on my condominium. Can I put the exemption on my condo? If the association tries to nonjudicially foreclose on me, will the homestead exemption protect me?

Answer: Simply, a “homestead” is your home. Although the equity in your home may be available to your creditors, many states, including California, provide for a “homestead exemption” as a way of protecting some, or all, of your equity.

Property subject to a homestead exemption is not limited to condominiums like yours in a common interest development. Single-family homes, mobile homes and boats also are among the dwellings that can qualify.

For debtors with multiple homes, only the principal dwelling qualifies. That is defined as the home in which the owner lives on the date a judgment creditor’s lien attaches to the dwelling and in which the judgment debtor resided continuously until the date of the court determination that the dwelling is a homestead.

California homeowners receive an automatic homestead exemption to protect equity when a court forces the sale of a house to pay for a judgment. The automatic exemption can be claimed only by a debtor who resides, or is related to one who resides, in that homestead property at the time of the forced judicial sale of the dwelling.

Read on.

Foreclosure sale postponed for Oregon dad, son featured in ‘American Winter’ documentary

The Oregon father and son threatened with foreclosure on their Newberg property have received another reprieve, the bank holding their mortgage said Monday.

John Cox, who was featured in the 2013 HBO documentary “American Winter” about the plight of unemployed families in the Portland area, faced auction of his property Wednesday. According to court documents, Cox owes more than $551,000 in principal, interest, taxes and other expenses on the nearly 5-acre property.

Wells Fargo spokesman Tom Unger said Monday, “The foreclosure sale has been postponed.”

“We are continuing to work with Mr. Cox,” Unger said in an email.

Cox said Monday afternoon, “I’m excited. There’s possibilities.”

Read on.

The Three Housing Bubblehead Amigos, Paulson, Rubin, Geithner: USA is still No. 1

Three former U.S. Treasury secretaries agree: the U.S. has plenty of problems, but it’s still in a dominant global position.

“We’re a bright spot in the global economy,” Henry Paulson, the former Goldman Sachs chief who worked for President George W. Bush, said Monday at the Milken Institute Global Conference in Los Angeles.

Paulson noted that steady, if slow, economic growth since 2009 and rising home prices as examples of America’s enviable position compared to other countries.

“I’d rather invest in the United States than any other country in the world. We have tremendous comparative advantage,” added Robert Rubin, the former Citigroup executive who served under President Bill Clinton.

Timothy Geithner, who served under President Barack Obama, echoed the sentiment: “If you look at the challenges we face as a country, they are pretty historic challenges, and our politics are terrible. But I think you’d rather have our challenges than the challenges of any developed economy.”

Read on.

HUD requires Investors to delay foreclosure for a year and offers a non-profit only pool sale

UD No. 15-048
Cameron French
(202) 708-0980
April 24, 2015
HUD requires Investors to delay foreclosure for a year and offers a non-profit only pool sale
WASHINGTON – Today, HUD announced significant changes to its Distressed Asset Stabilization Program (DASP). In an effort to better serve homeowners looking to avoid foreclosure, loan servicers will now be required to delay foreclosure for a year and to evaluate all borrowers for the Home Affordable Modification Program (HAMP) or a similar loss mitigation program. HUD is making additional improvements to the Neighborhood Stabilization Outcome (NSO) sales portion of DASP which are aimed at increasing non-profit participation. Updates include giving non-profits a first look at vacant properties, allowing purchasers to re-sell notes to non-profits, and offering a non-profit only pool.Previously, loan servicers could foreclose 6 months after they received the loan and were encouraged, though not required to assess a borrower’s qualifications for loss mitigation programs. Purchasers of the geographically targeted neighborhood stabilization pools have always been required to ensure that at least 50 percent of the loans in a pool achieve outcomes that help areas hardest hit by foreclosure avoid the neighborhood decline associated with numerous vacant properties.

“These changes reflect our desire to make improvements that encourage investors to work with delinquent borrowers to find the right solutions for dealing with the potential loss of their home and encourage greater non-profit participation in our sales,” said Genger Charles, Acting General Deputy Assistant Secretary, Office of Housing. “The improvements not only strengthen the program but help to ensure it continues to serve its intended purposes of supporting the MMI Fund and offering borrowers a second chance at avoiding foreclosure.”

All of these changes will be subject to stronger reporting requirements including tougher penalties for not complying with quarterly reporting responsibilities and a new requirement to report on borrower outcomes, even when a note is sold after the original purchase.

HUD plans to hold its first sale of 2015 in June.

Read on.

Ocwen’s road ahead: Well, can’t get any worse

Beleaguered Ocwen Financial (OCN) has been on a quest since December 2014 to get rid of its massive agency mortgage servicing rights holdings.

Last month the company said it is selling a $25 billion MSR portfolio to Nationstar Mortgage (NSM), just over a month after agreeing to sell another $9.8 billion portfolio of agency servicing to Nationstar.

That announcement is the latest in a string of agency MSR sales for Ocwen, which said in December that it plans to exit agency servicing entirely.

This year hasn’t been as bad for Ocwen as 2014, but the company has been facing a tough go of it.  Back in 2014 the New York Department of Financial Services was all over Ocwen – freezing a number of MSR deals at the start of the year and ending the year forcing the subprime servicer to pay $150 million for actions that likely caused “significant harm” to certain mortgage clients.  A bigger coup for the New York regulator: They took a scalp in the form of forcing former Chairman William Erbey to walk away from the company he founded.

It was a long time coming – the Consumer Financal Protection Bureau had Ocwen in its sights since at least 2012 for the sheer bulk of mortgage-related complaints that Ocwen generated.

Ocwen dragged its heels on its annual and fourth quarter filings for so long that word around the New York Stock Exchange is that plenty want the company delisted – a fatethat is befalling Ocwen affiliate Home Loan Servicing Solutions (HLSS) over at the NASDAQ.

Read on.