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Wednesday, October 21, 2009

Foreclosures Are More Profitable Than Loan Modifications, According To New Report

That's funny cuz they are not paying community assessments while they are in control of the property and most in not all of the condo, townhouse and hoa communities have plenty of foreclosed homes and they are running negative budgets and face huge special assessments and possibly bankruptcy in some cases

btw expect no help from the GOV or agencies like FANNIE, HUD, or the VA they are paying either and even raised the delinquency rates to 15 percent cuz they don't want too.

Read the Article at HuffingtonPost

Tuesday, October 20, 2009

Why no one claims an empty home.

Bank-Owned Homes Surge, Communities Stung « The Washington Independent

The growing number of bank-owned properties in foreclosure scarring neighborhoods across the country.

The volume of bank-owned foreclosed homes — known as REOs, or real-estate owned properties — is growing at an alarming rate, compounding the foreclosure crisis by sticking hard-hit neighborhoods with vacant and often trashed homes that drive down property values even more. REOs are foreclosed homes that lenders take back after they don’t sell at foreclosure auctions or sheriff’s sales. They keep the homes in inventory until they can be sold again.

The bottom line is that many of these homes( as many as 3 out of 5) are in condos, town home or single family homeowner associations. And, the banks or FANNIE don't want to be on the hook for the assessments.

So they just let the homes sit idol. To them nothing is happening. To the community the rest of the owners are dealing with not only the blight of them, they are dealing with the budget shortfall that empty homes cause and there is absolutely no help coming out of Washington DC.

If the number of home in the US that are in common interest communities is any where near the number trade groups like CAI post ( ) then this housing debacle is far from over and your government is trying it's best to cover it up.

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Fannie Mae and Assessments.

It appears that my years of asking that our Government take notice of the rise in delinquent Assessments and the effect this has on communities has not only fell upon cold marble Fannie has gone and done the exact opposite.

Delinquent HOA Dues for Units in Attached Condominium Projects
Announcement 07-18 states that when using CPM Expedited Review and Lender Full
Review for an established project consisting of attached units, no more than 15 percent of
the condominium/association fee payments can be more than one month delinquent.
Fannie Mae is updating its delinquent HOA dues policy for the CPM Expedited Review
and Lender Full Review processes to require that no more than 15 percent of the total
units in a project can be 30 days or more past due on the payment of their
condominium/association fee payments. This new policy applies to the review of both
new and established attached condominium projects.

So in simple terms a condo/coop/hoa budget is suppose to equal zero at the end of each calendar year. The budget is made up of line items that are explained in your documents and have a reason for being there. So when up 15 percent of the unit owners are not paying them what does this mean. It means either the services which are mandated by the documents are not preformed (trash pickup, recycling snow removal, common area maintenance, management fees, security street lights) and the community is in breach of it's own operating guidelines or a special assessment has been passed, which truth be told is considered personal debt, to make up for the budget short fall.

So what to guess has not been paying those assessment then look no further then FANNIE, FREDDY, HUD & VA. They have more of the properties then anyone and while they have been in possession of them the lack of good faith effort to pay the back assessment should be considered criminal.

Think about it someone was not paying the mortgage do anyone really think they were paying the community fees.

Why criminal! Because FANNIE requires a 921 Project questionnaire on every loan that it fund in a planned community and prior to this announcement the previous amount of delinquent assessments was no more then 10 percent.

Since they are the owners of so many homes this was starting to be a real problem. Thus the need for them to help the government was clearly greater then the need to help the community actually get the funds they need to fund the budget. How many homes did Fannie sell prior to this new percentage failed to even meet their own requirement? Is Fannie even filling out the 921 when they sell foreclosed properties.

The effect of all this is that anyone that happens to be buying into a community that has 15 percent deficit in income is walking into a huge problem and the government is doing nothing to help and in fact they are the problem.

btw the average community is more like 20 percent late if not higher.