Recently, a single mother lost her job in a central Florida town and was about to lose her house, too. But then she made a seemingly simple request of the bank: Show me the original mortgage paperwork. And just like that, the foreclosure proceedings came to a standstill. This homeowner, and others like her around the country, are managing to stave off foreclosure by employing a strategy that goes to the heart of the whole nationwide mess.

During the real estate frenzy of the past decade, mortgages were sold and resold, bundled into securities and peddled to investors. In many cases, the original note signed by the homeowner was lost, stored away in a distant warehouse or destroyed.
Persuading a judge to compel production of hard-to-find or nonexistent documents can, at the very least, delay foreclosure, buying the homeowner some time and turning up the pressure on the lender to renegotiate the mortgage.

In recent interviews with The Associated Press, lawyers, homeowners and advocates outlined the produce-the-note strategy. Exactly how many homeowners have employed it is unknown. Nor is it clear how successful it has been; some judges are more sympathetic than others. A Tampa lawyer, whose Consumer Warning Network Web site offers the free court documents this woman used to file her request, has played a major role in promoting the produce-the-note strategy.

Conversely, the deputy executive director of the American Securitization Forum, a group that represents banks, law firms and investors, dismissed the strategy as merely a stalling tactic. He said homeowners are “making lawyers jump through procedural hoops to delay what’s likely to be inevitable.” In his opinion, the original note is almost always electronically retained and can eventually be found.

Although Judges MAY be willing to accept electronic documentation; and, lenders are sometimes allowed to produce other paperwork to establish they are the holder of a loan, assembling such documents, to a judge’s satisfaction, takes time, which to homeowners is the point.

A University of Iowa study last year suggested that companies servicing mortgages are often negligent when it comes to producing the documentation to support foreclosure. In the study of more than 1,700 bankruptcy cases stemming from home foreclosures, the original note was missing more than 40 percent of the time, and other pieces of required documentation also were routinely left out.

The first big success of the produce-the-note movement came in 2007 when a federal judge in Cleveland threw out 14 foreclosures by Deutsche Bank National Trust Co. because the bank failed to produce the original notes.

Democratic Rep. Marcy Kaptur of Ohio endorsed the strategy in a fiery speech on the House floor during debate on the federal bank bailout last month. “Don’t leave your home,” she said. “Because you know what? When those companies say they have your mortgage, unless you have a lawyer that can put his or her finger on that mortgage, you don’t have that mortgage, and you are going to find they can’t find the paper up there on Wall Street.”

April Charney, head of foreclosure defense for Jacksonville Area Legal Aid in Florida, said the strategy has been so successful for her that she now travels around the country to train other lawyers in how to use it. She said she has gotten cases delayed for years by demanding that lenders produce paperwork they cannot find.

“This is an army of lawyers getting out there to stop foreclosures so we can get to the serious business of creating solutions,” Charney said. “Nothing good is going to happen as long as we continue to bleed homeowners.”

So, what about that central Floridian single mother's case? Well, she filed her "produce-the-note demand" last fall after the bank acknowledged that her original mortgage document had been lost or destroyed. Since then, there has been no activity on the foreclosure - no letters from the lender, and no court filings.

Labels: Business, Credit Partners, Fixing Credit; Bad Credit; Improving Credit Score, Florida, Florida Panhandle, Foreclosure, Investment, Panama City, Real Estate, Short Sale

Through the years, legislative bodies and professional organizations have tried to make it easier for Buyers and Sellers of residential properties to complete their transactions without the aid of attorneys. But more people these days are going to their closings accompanied by an attorney, or are at least having one review their sales and financing contracts in advance. And we agree!

Seems as though each and every day we hear horror stories of "sales gone bad" and the rising tide of foreclosures doesn't help one bit. It makes a lot more sense to seek a professional legal opinion BEFORE problems arise. It'll probably be the best $100 +/- you'll ever invest!

Suits occur after a sale ... before a sale in consummated ... when a contract is unfulfilled ... for specific performance ... just about anytime. With the aid of expert legal advice and, sometimes, the simplest addition of specific language, many problems are easily averted.


Many local REALTORS don’t like the idea of lawyers being involved in what should be a simple residential sale. With most firms not employing in-house counsel, they don't like shelling out the extra dollars from their commissions. But the laws are changing all the time, getting more complex, not less. And a legal review is a VERY good idea!

Labels: Business, Credit Partners, Deals, Finance, Fixing Credit; Bad Credit; Improving Credit Score, Florida, Florida Panhandle, Foreclosure, Investment, Panama City, Real Estate, Short Sale, Vacation

A move by the Florida Department of Health (DOH) to limit nitrogen seepage through septic systems could force some homeowners to install new and expensive septic systems. However questions remain, and one component worries Realtors: It calls for a septic inspection at the time of a home sale.

The DOH plans to present rule language for the Wekiva Study Area (WSA) to the Technical Review and Advisory Panel (TRAP) on Feb. 19 at the Orlando Airport Marriott. While the rule applies to the Wekiva area, it’s considered a possible blueprint for expansion statewide.

The Florida Legislature appropriated $1 million in 2007 for the DOH to begin a multi-year study on cost-effective nitrogen-reduction systems. However, the DOH has stepped up the timeframe to reduce nitrogen around Central Florida’s Wekiva River area based on an earlier law, the 2004 Wekiva Parkway and Protection Act. The DOH believes it must, by law, create rule language for nitrogen seepage as soon as possible around the Wekiva.

Septic tanks are a key component of the DOH plan. Passive systems currently used would be replaced by performance-based treatment systems that require electricity to operate, and the cost for a new system is projected by DOH to run from $3,000 to $10,000. The DOH plan would allow an exemption for any community being attached to a public sewer by 2012.

The upgraded septic system would apply to all new home construction and any system being modified or repaired. Importantly though, the DOH also wants septic tanks to be inspected for nitrogen levels as part of any home sale, which in many cases will trigger a mandatory replacement. The rule does not state who pays for a mandatory septic tank upgrade, making it part of the property contract negotiations. If necessary, DOH will give the new owner 18 months to complete the change, though a permit must be pulled prior to closing. In addition to adding an expected cost to some transactions, the rule could change the value of homes in the eyes of buyers, making listings on a public sewer line preferable to homes with septic tanks.

In January 2008, the Florida Association of Realtors® Board of Directors voted to support the continued use and installation of properly functioning standard conventional septic systems. It also moved to get the association more involved by appropriating money for a study that specifically looks for ways to reduce nitrogen using current systems, or in some other way that is cost efficient. The Board also voted to oppose any efforts to speed up state mandates for the higher-cost systems.

For more information, visit the DOH Web site at: http://www.myfloridaeh.com

Labels: Business, Florida, Florida Panhandle, Insurance;, Real Estate

Housing prices will hit bottom in the fourth quarter of 2009, predicts Moody’s Economy.com in a new report. “Despite the darkening national economic outlook and the weak conditions in the housing market, some positive signs give hope that a bottom in the housing market is coming into view,” the report says. On average, home prices will decline 36 percent from the peak in the first quarter of 2006, the report says. By the end of the housing downturn, nearly 62 percent of the nation’s 381 metropolitan areas will have experienced double-digit-percent declines in house prices, peak-to-trough, says the report. The declines will exceed 20 percent in about 100 metro areas, according to the report, and the recovery will be “lackluster.” “A number of uncertainties in both the housing and economic outlooks remain, and the risks tilt to the downside,” says Moody’s Economy.com Chief Economist, Mark Zandi.

Labels: Business, Condos, Deals, Finance, Florida, Florida Panhandle, Foreclosure, Panama City, Real Estate, Short Sale, Vacation

Ralph R. Roberts, consumer advocate and spokesperson for Federal Loan Modification Law Center, LLP, released a list of the top 10 steps homeowners can take to negotiate an affordable loan modification. The following steps apply to homeowners working directly with a lender, as well as to those teaming up with an attorney or alternative third-party representative.

1. Come clean. It can be tempting to bend the truth when you are trying to convince a lender to approve a loan modification. Only by laying all your cards on the table and disclosing the truth can you begin to develop and implement solutions that will put you back on the path to long-term financial health.

2. Understand your lender’s point of view. As far as your lender is concerned, it all boils down to money. You are most likely to be approved if you can show modifying your loan will cost the lender less than a foreclosure.

3. Keep a cool head. Expressing anger toward your lender puts you in an extremely disadvantageous position. For example, your lender may decide that you are unreasonable and that foreclosing would be less costly overall.

4. Give them what they need. In order to expedite the situation, find out exactly which forms you need to fill out and which documents your lender needs to process your application. Make sure you provide everything to your lender or representative in the manner specified.

5. Ask for what you want. Before meeting with your lender, make sure you spend some time figuring out what you want and need. For example, how much can you realistically afford to pay each month?

6. Let them do their job. Loan modifications typically take between 30-90 days from start to finish. During this time, avoid the temptation to micromanage the process. To alleviate unnecessary anxiety, ask your lender for an anticipated timeline.

7. Get your financial house in order. Put a tracking system in place today and start developing a budget to ensure you are not spending more money than you are earning.

8. Keep everyone posted of any changes. If anything changes related to your financial situation, be sure to keep your loan modification representative or lender in the loop.

9. Make sure the lender’s offer is truly affordable. If the loan modification is unaffordable or makes your budget so tight that you are only one car repair or medical bill away from defaulting again, head back to the negotiating table to try to work out a better deal.

10. Hold up your end of the bargain. The key to success is discipline and commitment. All the effort you spend setting up a plan is of no use if you don’t follow the plan you created or agreed to.

Labels: Business, Credit Partners, Deals, Finance, Florida, Florida Panhandle, Foreclosure, Investment, Panama City, Real Estate, Short Sale, Vacation

Al Muller had numbers on parade Wednesday when he spoke to the Navarre Area Board of Realtors about where the local real estate market has been and where it is. But what his audience of nearly 90 really wanted to know was: How soon will things get better?

Muller’s answer: That pretty much depends on the intersection of projected & actual trend lines when it comes to sales. That would align the ability to buy based on actual income and when prices become affordable again. “When will the two lines meet?” Muller asked rhetorically. “Optimistically, by the end of 2009 ... pessimistically, by the end of 2010 ... realistically the middle of next year.”

Muller is with Metro Market Trends, which provides reporting and analysis information on real estate sales, tracking and market share for Florida and South Alabama. His PowerPoint presentation showed resales of single-family homes down 19 percent in Navarre and on Navarre Beach since 1991. Condo resales are down 58 percent for the same span. “Booms are followed by busts,” Muller said, “but bubbles are followed by carnage. ... This is the first time in our history that a real estate decline has pushed the economy into recession, instead of the other way around.” Declining home prices and an increasing foreclosure rate were factors he listed on both the positive and negative sides of the ledger. “That’s our medicine,” Muller said, “and there is no other answer but time.”

Unless, of course, President Barack Obama’s administration and key federal agencies intervene.

“We forget that the federal government now owns Freddie Mac and Fannie Mae,” Muller said, “and if they want to decide Monday that rates are 4 percent on a 30-year fixed loan, they can do it. ... This would mean something to people who could refinance or people who are sitting on the fence about buying.”

James Baker from Fort Walton Beach-based mortgage banker Baker and Lindsey Inc. saw elements of hope in the presentation. “It’s felt negative for a long time, but the data he has supports our feeling that there’s good mixed in with the bad,” Baker said. “What struck me most was hearing that it’s much worse in other areas. That means we can feel better about this market coming out of it sooner.”

And what about those 4 percent loans? “Definitely not a pipe dream,” Baker said. “It would be one of the most effective things the government can do. It would help people buy homes, and if they refinanced with that rate, the value and the payments would be more in line. That would make people feel better about their homes, and that would directly affect foreclosures.”

Labels: Business, Credit Partners, Deals, Finance, Florida, Florida Panhandle, Foreclosure, Investment, Panama City, Real Estate, Short Sale, Vacation

A new tax credit of up to $8,000 for first-time homebuyers that’s being included in the economic stimulus package was far less than the homebuilding industry wanted, and analysts expect it will provide only a modest boost to the battered U.S. housing market.

The tax credit is part of the economic stimulus package expected to be signed by President Barack Obama on Monday. It was scaled back from a Senate proposal of $15,000 and limited to first-time buyers who act between the start of this year and the end of November. The credit for 10 percent of the value of a home, up to $8,000 was estimated to cost the government $6.6 billion. It starts phasing out for couples with incomes above $150,000 and single filers with incomes above $75,000. Buyers will have to repay the credit if they sell their homes within three years.

Struggling homebuilders, already looking ahead to the traditional spring selling season, had been counting on Congress to help spur pent-up sales after completing the worst year for new home sales since 1982. Executives for one major builder noted earlier this week that they had seen an uptick in traffic over the weekend as many prospective buyers learned of the Senate’s original incentive provision. But with that proposal gone, Wall Street analysts said the homebuyer provision will have a negligible effect on homebuilders’ fortunes. “Congress, unambiguously, left the builders out in the cold,” said Deutsche Bank analyst Nishu Sood. “It’s a pretty big disappointment that they scaled it back.”

Real estate agents were more optimistic. The National Association of Realtors projected the change will stimulate an additional 200,000 home sales. The big unknown, however, was the state of the economy. With employers laying off thousands of workers, many potential homebuyers are nervous about making such a big financial commitment.

Mortgage rates remain low, falling this week to a national average of 5.16 percent for a 30-year fixed-rate mortgage, according to mortgage finance company Freddie Mac. But credit remains tight and borrowers need a downpayment of at least 3.5 percent to qualify for a loan backed by Federal Housing Administration, a popular option for many first-time buyers.

Many potential buyers haven’t saved up enough money for a downpayment. “If you don’t have a way to get that, the tax credit doesn’t do them much good,” said James McCanless, an analyst who covers builders for FTN Midwest Securities.

But if the government can prod lenders to loosen credit standards and buy enough mortgage-backed securities to keep mortgage rates low, the tax credit could make a difference, said Mark Zandi, chief economist at Moody’s Economy.com. “I don’t think it’s enough to jolt the housing market back to life, but it’s a plus,” he said. Last year, Congress enacted a $7,500 tax credit for first-time buyers, but that had to be paid back over 15 years and the impact on home sales was negligible.

First-time buyers, in last year’s law, were defined as those who haven’t owned their own homes for three years. “The bulk of the market right now is first-time buyers,” he said. First-time homebuyers bought 2.2 million new and existing homes last year, according to the National Association of Realtors, making up about 41 percent of total U.S. home sales, up from 39 percent in 2007 and 36 percent in 2006.

Concerns about the bill’s overall costs, plus criticism that a much larger credit would not benefit borrowers on the verge or foreclosure, and mainly help people with healthy enough incomes to buy a house helped sink plans for a much larger credit. The homebuilding industry mounted an unsuccessful push for a credit for up to $20,000 for all buyers, flying builders in from around the country last month for a massive lobbying push that wound up falling short. “What the builders wanted was massive relief – not targeted toward where the real problem was – paid for by everybody,” said Thomas Lawler, a Northern Virginia housing economist. “That seemed to be pretty egregious.”

Sales fell in the fourth quarter of last year around the country, except for six states where buyers have been able to snap up foreclosed homes at a bargain: Nevada, California, Arizona, Florida, Minnesota and Virginia, the National Association of Realtors said Thursday. Nationwide, the median sales price was $180,100, down 12 percent from a year ago.

Labels: Business, Credit Partners, Deals, Finance, Florida, Florida Panhandle, Foreclosure, Investment, Panama City, Real Estate, Short Sale, Vacation

A recent newsbreak indicates State Farm Florida is pulling out of the homeowner insurance business in Florida. This is a surprise move that will leave more than 800,000 policyholders without coverage and will cause almost certain turmoil in the Florida insurance marketplace.

State Farm Florida president, Jim Thompson, claims they're "faced with steep declining resources to cover future claims and expenses" and says the company "...has little choice."

Thompson said the company's plan requires regulatory review, and State Farm Florida will not begin dropping policies under the plan until that process is complete. Florida, however, has no law on the books that would prevent State Farm from leaving the state's homeowner insurance market.

State Farm Florida emphasized that it was submitting a two-year plan that seeks to limit disruptions for customers, and if approved, will allow them time to find coverage with other insurers. (State Farm is Florida's largest private homeowner insurer, second only to state-sponsored Citizens Property Insurance Co.)

State Farm is also Florida largest automobile insurer with more than 3 million policies. The company says it will continue to offer auto coverage. However, a 2007 state law pushed by Gov. Charlie Crist prevents insurers from offering only auto policies if they offer both auto and homeowners in other states. And so it SHOULD be! If they want Florida's lucrative auto insurance business, they should offset that with the POSSIBILITY - not certainty - just POSSIBILITY of potential homeowner losses.

Seems as though State Farm wants their cake - and wants to eat it too. I say - NO WAY!

Labels: Business, Condos, Finance, Florida, Florida Panhandle, Insurance;, Investment, Panama City, Real Estate, Vacation

With the opening of the new airport in 2010, traffic flow had to be addressed - here's what's happening.

Initial plans call for 2 lane County Road 388 (it runs East West and is located just south of the newly planned Bay County airport) to be 4 laned between State Rd 77 and State Rd 79. Then, to accommodate our sister county to the West, another section of new 4 lane will extend west from State Rd 79 to Hywy 98 east of Peach Creek in Walton County. This new roadway, dubbed the West Bay Parkway, should provide better access to the new airport and improved hurricane evacuation efficiency. Don’t get too excited, though. The Bay County planning stages alone are predicted to take up to 3 years with the Walton County portion adding another 2 on top of that.

Labels: Business, Deals, Florida, Florida Panhandle, Investment, Military, Panama City, Real Estate, Vacation

Stephen Elias, author of "The Foreclosure Survival Guide: Keep Your House or Walk Away with Money in Your Pocket" has the following take on foreclosures:
"Businesses know that they can take advantage of legal options to change or abandon the terms of the contracts they sign ... but individuals tend to be far more reluctant to do so. Just as people don't like to file for bankruptcy, they don't want to allow a foreclosure," Elias said. "They feel they should pay their debts."

Some change their minds when they see the hopelessness of their situation or the advantages of walking away from what they owe. But others feel honor-bound to pay if they possibly can. Such folks will do what they can to avoid foreclosure, and move out as soon as it's clear they're losing their homes. Those folks aren't stupid. What may not be the smartest decision in financial terms is still the right choice for them. "It's so much more important to listen to your heart and go that way," Elias said, "than to take advice from someone like me."

If you're weighing whether to fight for your home, Elias suggests you ask yourself these three questions:
(1) Can you make your mortgage payments while meeting your other obligations? Those obligations include feeding your family, paying your other bills and saving for retirement. If you can trim your expenses and reduce your bills to make your mortgage more manageable, clearly you should. But if your payment already gobbles up half or more of your gross income and more increases are on the horizon, your situation may be untenable.
(2) Can you keep your home without raiding your retirement funds? It's almost never a good idea to dip into your 401(k) or individual retirement account to pay continuing bills. Withdrawals trigger serious tax penalties and deprive you of future tax-deferred returns -- figure that every $1,000 withdrawal costs you $10,000 in future retirement income. That sacrifice might be worth it if you'll actually keep your house, but many who are tempted to raid their retirement funds will only delay, rather than prevent, the loss of their homes. Then they're left with no home AND no retirement.
(3) Is a rescue in sight? Don't mortgage your future by holding out for a rescue that may never come. Talk to a HUD-approved housing counselor. These folks know all the details of the loan modification plans and can help you assess whether, and how much, you'll be helped. You can find referrals through your Personal Real Estate Consultants.

If you decide to explore foreclosure ... Avoid scams. Ignore anyone who contacts you offering foreclosure help or demanding huge upfront payments. HUD counselors, or those from the National Foundation for Credit Counseling, can provide the information you need for free. If you decide you need an attorney's help to save your home, get a referral from your local bar association or Personal Real Estate Consultant. Learn more about the foreclosure process. It varies widely from state to state, moving faster in some than in others and carrying different risks. In some states, for example, lenders can sue you for the difference between what you owe and what the foreclosed home sells for; in others, the risk is lower or nonexistent. Elias' book is an excellent primer, but you'll also want to talk to a bankruptcy attorney.

Lastly, keep an eye on the bankruptcy news. Right now, a bankruptcy doesn't do much to help you keep your home unless you can quickly catch up on your payments. But Congress may soon allow bankruptcy judges to modify terms on primary residence mortgages. If your principal could be reduced and your payments made more affordable, the cost of a Chapter 13 bankruptcy filing could be worthwhile -- but again, you'll want an attorney's advice.

Labels: Business, Finance, Fixing Credit; Bad Credit; Improving Credit Score, Florida Panhandle, Foreclosure, Investment, Real Estate, Short Sale