Foreclosures

The Obama administration's new plan to stimulate refinancings of FHA mortgages is likely to help large numbers of homeowners — even those who are deeply underwater — cut their monthly costs by switching to a loan with a rate below 4%. Here's a quick overview of the "streamline refi" program and what it will take for you to qualify. First, the baseline criteria: Your current home loan must be FHA-insured and must have been put on the Federal Housing Administration's books no later than May 31, 2009.

SACRAMENTO - Efforts to ease California's foreclosure woes, among the worst in the nation, are running into roadblocks at the state Capitol. A rare legislative conference committee called to rescue a pair of stalled foreclosure-prevention bills is bogged down in marathon sessions. Meanwhile, Gov. Jerry Brown is pushing to use some of California's share of the $25-billion national mortgage settlement to plug holes in the state's budget, dismaying housing activists. Since the start of the real estate bust, foreclosures have been a persistent drag on the state's homeowners and economy.

Distancing himself from Republicans on housing issues, President Obama pitched a $5-billion to $10-billion plan to help a key segment of struggling homeowners — those still making monthly payments, but on underwater mortgages. Obama proposed Wednesday to help about 3.5 million people with good credit who are unable to refinance at historically low rates because their homes are worth less than their mortgages. He argued that those homeowners — and the country — couldn't afford to let the housing market bottom out, as many Republicans, including presidential candidate Mitt Romney, have advocated.

Southern California's housing market showed signs of turning the corner in April as foreclosures made up the smallest share of sales in four years and the region's median home price increased for the first time since late 2010. Among other evidence of improvement, foreclosures dropped significantly in California and other Western states last month, a continuation of a trend that began last fall, according to data firm ForeclosureRadar. A separate report by the nation's mortgage bankers released Wednesday showed that national delinquencies and foreclosures hit a four-year low, driven largely by declines in states in the West.

First of three parts Tiffany Lee wanted a car. She was weary of the two-hour bus ride to her job at a UCLA Health System clinic. She hated having to ask friends to drive her 7-year-old son to his asthma treatments. But as a single mother with three children, bad credit and a $27,000-a-year salary, she couldn't find a bank or dealership willing to give her a loan. Then a friend steered her to Repossess Auto Sales in Hawthorne. Another buyer might have balked at the deal she was offered.

A record number of homes were lost to foreclosure in California over the last three months. Foreclosures are up 228% from last year to a high of 79,511 homes. MDA DataQuick reported that more homes were taken back by lenders in the three months that ended Sept. 30 than at any time since the company started tracking foreclosures in 1992. In the previous three months, which also set a record, 63,316 homes were lost to foreclosure. That's a huge swing from an all-time low just three years ago of 637 in the second quarter of 2005.

The third-quarter foreclosure report released by PropertyShark.com last week paints another bleak picture. Los Angeles County foreclosures, totaling 15,749 by its methodology, were up nearly 196% from the same quarter in 2007, when there were 5,322. And compared with the second quarter of '08, which had 14,505 foreclosures, they were up 9% in the third quarter. If that's not dramatic enough for you, way back in the third quarter of 2006 the county recorded just 1,539 foreclosures.

With mortgage interest rates edging down and the price of homes a good 30% below their peak in Southern California, Ryan Ratcliff made a decision on the minds of many: He decided to buy a house. Ratcliff, a University of San Diego economist who makes his living forecasting the housing market, hopes to close escrow next week on a three-bedroom house in a northern San Diego neighborhood known for its good schools. "I may not have exactly timed the bottom," said Ratcliff, who paid 25% less than what the foreclosed house sold for in 2006, "but I think we're close enough that I'm comfortable."

If you give millions of seriously underwater homeowners a new equity position in their properties by reducing their principal mortgage debt, will they keep paying on their loans and avoid foreclosure? Call it a pipe dream or a significant model for other lenders and investors, but one company says it has found an important combination: Modify underwater borrowers' loans so that their payments are reduced to a manageable amount and cut their principal debt over time, but make the deal dependent on their scrupulous on-time monthly payments of the new amount plus sharing of a portion of any future profit they make on the house sale.

Home builders are switching tactics and confronting head-on one of their biggest nemeses: foreclosed houses that not only lure buyers away with deeply discounted prices but simultaneously depress the appraisal values of newly built homes. At a packed session at the International Builders' Show expo Feb. 8-11 in Orlando, consultants and builders said that with gluts of foreclosures in major markets around the country — and more forecast to arrive in the next two years — the time has come to stop being passive and to begin aggressively educating buyers about the often hidden costs of buying foreclosures.

Foreclosure activity in the U.S. fell last month to its lowest level since the start of the credit crisis in 2007, driven largely by drops in states such as California, where the process occurs outside of the courtroom. Foreclosure filings - default notices, scheduled auctions and bank repossessions - were logged on 18,780 homes, according to RealtyTrac. That was a drop of 5% from the prior month and a 14% decline from April 2011. One in every 698 U.S. housing units had a foreclosure filing during the month.

Joining a growing number of municipalities, the Los Angeles City Council on Tuesday adopted a "responsible banking" ordinance that will require banks doing business with the city to disclose detailed data on loans and foreclosure activity by community. Much of the information is already reported under federal law but can be hard to find in voluminous federal banking reports, said Miguel Santana, city administrative officer. The new law would bring the information together on a city website that the public could search by census tract, he said.

In another flicker of hope for the battered housing markets, home loans in foreclosure or at least one payment past due have declined to the lowest level since 2008, according to a Mortgage Bankers Assn. delinquency report .  The quarterly study, released Wednesday morning, said 7.4% of all loans on 1-unit to 4-unit properties were past due at the end of the quarter, taking seasonal factors into consideration. That was down from 7.58% at the end of the fourth quarter and 8.32% a year earlier.

Among all the special places inside his sprawling 10,700-square-foot mountaintop home, Daniel Coletti savors the vibe inside the living room most. It's a luxury dreamscape distinguished by mammoth walls of glass and Idaho-hewn stone. At night, he gazes out past the blue waters of an indoor-outdoor infinity pool and onto a vast citywide vista capped by the shimmering lights of the Strip. "It's like looking at a fire," his wife, Natalie, said. "You can't turn your eyes from it. " The property has another unique feature: Offered at $13.9 million, it's the most expensive residential listing in Las Vegas.

It's not quite a check in the mail, but certain distressed mortgage borrowers at Bank of America Corp. will be happy they opened the letter anyhow. The Charlotte, N.C., lender said Tuesday it has begun contacting about 200,000 customers who have fallen behind on home loans and owe more than their current home values. It is notifying them that they may qualify to have their loan balances reduced as much as $100,000 as part of a $25-billion, 49-state settlement over foreclosure abuses.

As California pushes to get more homeowners into a $2-billion foreclosure prevention program, some Fannie Mae and Freddie Mac borrowers may see their mortgages shrunk through principal reduction. State officials are making a significant change to the Keep Your Home California program. They are dropping a requirement that banks match taxpayers funds when homeowners receive mortgage reductions through the program. The initiative, which uses federal funds from the 2008 Wall Street bailout to help borrowers at risk of foreclosure, has faced lackluster participation and lender resistance since it was rolled out last year.

MANY see trouble in falling home prices and rising foreclosures. Karen Krynen sees opportunity. So after dropping her two children off at preschool one day last month, Krynen headed for Los Angeles County Superior Court in Norwalk, where foreclosed houses were being auctioned on the steps outside. The ponytailed Krynen spotted a small crowd gathered against the building's towering, black-marble portico.

Just as the housing market recovery has stalled, so has the Obama administration's main program to ease home foreclosures. Only 36,695 homeowners received permanently lowered mortgage payments in July through the much-criticized Home Affordable Modification Program, the smallest increase since December, administration officials said Friday. And the number of people dropping out of the program continued to soar. Overall, nearly half the homeowners who entered the program since it launched in March of last year have dropped out. Many had hoped the $75-billion program would be a silver bullet to the foreclosure problem, but it's turned out to be a dud, said independent banking analyst Bert Ely. That's not surprising, he said, given the depth of the housing market crash and recession, combined with a slow recovery.

Here is a roundup of alleged cons, frauds and schemes to watch out for. Memorial Day - Memorial Day has become an opportunity for criminals to target veterans as well as active duty military and their families, the Better Business Bureau said in a recent bulletin. Older veterans are often targeted by scammers this time of year, the BBB said. "The unique lifestyle of our service members makes them prime targets for scammers," noted Brenda Linnington, director of the BBB's military division.  "It's imperative that we educate our service members and ensure that the support we give to them equals the effort they make every day on behalf of us. " Some scams target service personnel and their families directly, while others go after people attempting to contribute to military charities.

A nation still struggling to clear up one housing debacle has run smack into another - soaring rents. The foreclosure mess has pushed millions of former homeowners with tarnished credit into a competitive apartment market across the U.S. Add fresh demand from young workers, few new units and tight standards for home loans, and the result is rental sticker shock not seen in years. Rents are surging from New York to Los Angeles. The average monthly U.S. rent for apartments hit $1,008 in the first quarter, pushing past the all-time high set in the third quarter of 2008, according to the data firm RealFacts.