Sunday, February 14, 2010

Foreclosure Laws in Florida

There was an article in the Florida Realtor today about the new legislation on foreclosures. This specific legislation was about the banks efforts to speed up proceedings for the foreclosure process. In Florida the foreclosure process is handled by the courts and in today's world that means that the process could take 12-24 months. The banks want to speed up the process by taking it out of the courts and in to a proceeding that could get people out of their homes in 90 days.

Obviously this is a tough issue because no lawmaker thinks it makes sense to get half a million defaulted homeowners out of their homes faster when a lot of them want to work something out. Homeowner and condo associations are missing out because dues are not paid and neighbors are upset about the foreclosed homes that are abandoned and not kept up.

It is an issue that won't be resolved anytime soon. It is disconcerting that nothing has been done to help the homeowners situation. I have seen and met with many homeowners who would rather settle and the banks won't even answer a simple call about what could be done. It costs banks more money to go through the court proceedings than just settling or short selling homes so it doesn't make sense that they don't move. The first thing that crosses my mind is that they don't care since most have been bailed out anyway but a short sale would seem to be a better option. I have personally seen auctioned homes go for 40 to 50 percent less than a bank would have gotten through a short sale and they don't have to hire a lawyer to go through the process.

Most likely no significant bill will go through to help present situation. They will pass something after the fact and it will prevent this from happening in the future. Only time will tell.

Monday, February 01, 2010

Update on Mortgage Lending

This is a good article focusing on what could happen if the government pulls back some of their investing in the home market. This is the test that the Fed is worried about. They could stop buying the mortgage backed securities in March as planned leaving open a market to investor money that still does not have faith in the market. The biggest worry is inflation.

This also will show how much the market can hold up on its own. I always question when the government gets involved because if the market does not stay afloat, and that is if the governemnt pulls out fully, then it shows that the housing growth of the past year was fake. If it holds up then the investment the government made in mortgages worked to boost the private sector's confidence in these securities.

Only time will tell and it is most likely the government will not fully stop the money because they are scared the market is not ready.