Calif Assoc of Realtors on Wrong Side of SB900/AB278www.HOFJ.org
Blog Category: Home Owners For Justice
FALLACIES from the Calif Assoc of Realtors (CAR):
C.A.R. is OPPOSING a conference report, AB 278 [and SB900], containing anti-foreclosure legislation sponsored by the state Attorney General. C.A.R. opposes provisions in this measure which will allow anyone to stop the foreclosure process by filing a lawsuit, merited or not. C.A.R. agrees that careful and balanced reforms to the foreclosure process are necessary. However, C.A.R. opposes this conference report because it will further delay the housing recovery by inviting bad-faith lawsuits and defaults, and making it difficult for even well qualified borrowers to obtain financing.
1. DELAY HOUSING RECOVERY: Not. SB900 will not delay housing recovery. In fact, it will have the opposite effect. Without this bill we can expect home prices to CONTINUE TO FALL as the banks ramp up foreclosures with little any owner can do about it. In California, another 135,812 homes are scheduled for foreclosure in the next 3.5 months. THIS foreclosure epidemic is what has devastated prices and will continue to do so until foreclosures stop.
This bill will help stop foreclosures, and should force servicers to get more serious about loan mods with principal reduction. Loan mods with principal reduction would allow the market to return to normal with sellers being able to sell without having to sell short or just fall into foreclosure.
2. INSPIRE BAD FAITH LAWSUITS: Not. Owners have to pay for these lawsuits up front, which will greatly inhibit bad faith ones. However, this law will give owners some modest recourse when the servicer jacks them around as they typically do these days - dual tracking, lying to the owners about foreclosure while they're theoretically working on a loan mod, tossing owners from department to department, everybody saying something different. Ideally, with this law in place, servicers will be forced to deal honestly and professionally with owners.
3. DIFFICULTY IN OBTAINING FINANCING: Not. Are you kidding? If anything would have stopped lenders from lending, it would have been last year's law about NO LENDER RECOURSE in a short sale no matter how the loan was obtained - refinance, investment - instead of just purchase money loans being protected. That hasn't make a particle of difference in lending. SB900/AB278 won't make any lending difference either. It is just too lucrative to lend on Californian homes. Period.
4. FINANCING IS DIFFICULT TO GET: Yep. But not because of foreclosures or a lack of foreclosures, and financing difficulty has nothing to do with SB900/AB278 at all. Foreclosures are a completely different department than the lending side of these institutions.
If anything, it's greedy servicers wanting to securitize home loans that makes financing harder to get. All home financing is now going through several levels of underwriting to ensure the loan follows FHA guidelines, so the servicer can be SURE to sell it to investors in mortgage backed securities, whether that is Fannie/Freddie, or the market (Fannie/Freddie are ramping up their securitization investments instead of being "wound down" as congress wants). This is where the pressure for financing quality and difficulty comes from. This difficulty has NOTHING to do with foreclosures or these bills.
As a member of CAR myself, I was horrified to discover CAR was against Owners on this issue. All owners, realtors, and agents need to contact their CAR representatives and let them know this is NOT the side to be on.
As more and more owners discover the truth that bank fraud is required to foreclose and that bank fraud and lies have caused this entire foreclosure debacle, they will remember CAR being on the side of the banks..... CAR beware.
CJ Holmes, real estate investor since 1977, broker since 2005, and market analyst since 2007, has personally handled hundreds of transactions, viewed thousands of properties, and dealt with countless agents. She also owns a portfolio of income producing properties, and has developed unique market analyses to determine and predict price trends, which principles apply to markets nationwide. She recently founded Home Owners For Justice and can be contacted at (707) 578-5727, email@example.com, www.cjholmes.com, or www.HOFJ.org