Here's the back story.

Jeff emails: Great news. Building has been sold Brookfield and Stellar both gone as of today. Thank GOD!!!!! They took me through this eviction BS for nothing. Filing a civil suit against them next week but SO HAPPY!!!!!

Karen Triggiani tells me that foreclosure is blind. Even the rich homes are going into foreclosure at increasing rates.

It's harder to feel sorry for the rich.

The LAT reports:

The number of homes in the $1-million-and-up slice of the market that have become bank owned has tripled in the second quarter compared with the same period three years earlier in Los Angeles County, which has the majority of Southern California's high-priced REO houses. And the trend has shown little sign of slowing, according to data from ForeclosureRadar.

By comparison, the number of homes reverting to banks in all price ranges combined peaked in the third quarter of 2008.

Many of the reasons the rich lose homes to foreclosure are no different from those of moderate- or low-income borrowers — poor financial management, the loss of a job, a drop in home value — said Mark Goldman, a foreclosure expert and loan officer who teaches about real estate investments and finance at San Diego State University. That the top of the market is still seeing increased foreclosures may reflect the staying power of owners with deeper pockets who could hold on to their homes when the economy first faltered, he said.

Diana Perkins writes:

Every year, there are over 8 million homeowners who are seeking help to prevent losing their homes to foreclosure. Many homeowners are not even aware that they can prevent losing their home to foreclosure by following some methods. Potential loss of home is the single largest problem that you may face if you are going through financial hardship. Foreclosure may mean loss of shelter to many but to most of them it means loss of investment to create home equity. If you are having money problems, then consider calculating your monthly payments with a mortgage calculator and check whether or not you can afford. You can also follow these legal ways to avoid losing your home to foreclosure.

a) Evaluate a budget: The first thing that you need to do is to evaluate a budget and see if there are spaces where you can cut down your expenses. Only if you curtail your expenses, you can increase your income and use it in making your monthly mortgage payments. If you are on the verge of facing foreclosure and you need to make some special effort to eliminate unnecessary expenses, then you need to divide your expenses into high priority and less priority expenses. Try to curb the less priority expenses so that you can arrange your mortgage payments.

b) Ask the mortgage company to change the term: If you want to pay off your mortgage and avoid facing foreclosure, then ask your lender to change the terms of your mortgage. There are two methods of changing the terms of your mortgage. Either you can modify your loan which is known as loan modification or you can refinance your mortgage. Both a refinance and a loan modification can help you lower the interest rates and change the term of the loan. You can easily avail these two options if you are keen on paying off your home loan. Calculate your monthly payments after a loan modification by a mortgage calculator.

c) Work out a repayment plan: If you do not want to go for loan modification or a refinance, then you can work out a repayment plan with your mortgage lender. He may pose some relaxations in the term of the loan and that may help you in repaying the loan. Generally mortgage companies instead of foreclosing, offer you a repayment plan so that they do not have to foreclose your house. The lender company also loses a lump sum amount of money when they foreclose your house. Thus, take advantage of this option.

d) Ask for forgiving a payment: If you can promise in written to the lender that you will be current on your payments after missing a payment or two, then the lender may agree to forgive those payments. He may waive off your obligation and give you a break. This is a very rare case but you can try it out if you need to.

Thus, if you are a troubled homeowner then consider the points mentioned above to avoid foreclosure. The best way to save your home is to take a mortgage that you can afford. Calculate your affordability before taking a home loan with a mortgage calculator.

Diana Perkins writes:

Financial decisions are the most important decisions that are to be taken in someone’s life. Usually smart financial decisions go beyond normal savings and periodic investments. Sometimes you are faced with tough decisions in order to improve your financial situation. Similarly, if you are a troubled homeowner and you need to improve your financial situation, opt for a mortgage refinance. It is one such aspect of your life that can breathe some life into your stagnant financial situation. Mortgage refinancing involves paying off your current mortgage by taking another loan. You enjoy more than one benefit by refinancing your mortgage. Have a look at some of them.

1) It offers lower interest rate: The biggest advantage of home refinance is that it comes with a considerably lower interest rate. Usually, homeowners have to carry a heavy mortgage payment every month. So homeowners are often in a look out for ways to reduce their monthly payments. The only way of accomplishing this goal is to opt for a refinance. As the interest rate on your loan reduces, automatically you are left with lower monthly payments.

2) You can switch from a fixed rate to an ARM: Mortgages are basically of two types. Fixed rate mortgages and adjustable rate mortgages. Refinancing your mortgage will also allow you to switch from a fixed rate mortgage to an adjustable rate mortgage. The adjustable rate mortgages (ARM) are the most cost effective when the interest rates are low. In contrast the fixed rate mortgages are a wiser option when the interest rates are high. You can run the risk of being subject to outrageous interest rates with an ARM. You can change the loan program type from a fixed rate mortgage to an ARM when the interest rates go down.

3) You can cut short the mortgage term: If you had taken a 30 year term fixed rate mortgage, then owning full equity on your home will take a long span of 30years. On the contrary refinancing your home allows you to cut short the duration of the mortgage for several years. This will enable you to own full home equity in approximately half the time. You can save thousands of dollars on your interest payments by paying off your mortgage before. But make sure you opt for this option only when you are sure that you can arrange the higher monthly payments.

4) You can access a huge amount of cash: The best part of mortgage refinancing is that it provides you with an opportunity to access a huge amount of cash. The equity that you have built over the years entitles you to this extra cash through cash-out refinancing. Refinancing is often called a best way of consolidating your debts. If you have a huge amount of unsecured debts then you can go for a refinance. You can use this extra cash from cash out refinancing for any purpose. You may use it to pay off credit card debts, home improvement, or for funding your children’s higher education.

In a nutshell, if you want to take some smart financial decisions and save your finances then mortgage refinance is perhaps the best option. Save the extra money on interest and build equity faster on your home through a refinance. Pay off your home loan in affordable monthly payments by taking advantage of mortgage refinancing.

More mortgage modification news.

Will the schemes and manipulations never end?

Why not let the free market sort it out?

Here's an article from CNBC sent to me by Karen Triggiani:

If you’ve demonstrated a track record of paying your mortgage consistently, not late, on time, for the past 24 months, we’re going to re-fi you without documentation, without looking at an appraisal, we’re just going to lower your mortgage rate,” said Doug Dachille, CEO of First Principles Capital Management.

Dachille, formerly president of Zurich Capital Markets and global head of proprietary trading for JP Morgan [JPM 37.73 0.23 (+0.61%) ], acknowledged that if banks became more flexible in their lending practices toward homeowners, it would would upset investors of mortgage-backed securities. But he added that those investors have reaped the financial rewards of the Federal Reserve's policy of mortgage-backed securities to help keep interest rates low.

“Mortgage-backed securities investors have gotten a benefit from something that was unprecedented too,” he added. “And that was that the Fed was buying $1.25 trillion (of mortgage securities) at a time when people couldn’t re-fi, driving up the price to historical levels.”

Economists expected interest rates to rise dramatically in 2010.

It hasn't happened. They've stayed at record-low levels.

The federal government has a huge deficit. Why isn't this demand for funding driving up interest rates?

How will this affect the housing market?

Karen Triggiani sends me along this article in the NYT:

That interest rates have declined is good news in many respects. “There are,” said Sal Guatieri, senior economist at BMO Capital Markets, “always people who have jobs who can take full advantage of lower interest rates to borrow and spend.”

But that impact now may be weakened by two factors, perhaps increasing the need for fiscal stimulus.

First, there are many who will not be helped. Homeowners with ample equity and income can refinance their mortgages at record low rates, which fell to 4.4 percent last week. But millions of homeowners either lack sufficient income or have houses no longer worth what is owed on the mortgage. They cannot refinance.

On Dennis Prager's radio show today, economist Tom Sowell said: "What got us into this was that mortgages started to default and there was a whole domino effect going through the whole financial system because people had bought these mortgage-backed securities and money wasn't coming.

"The question is — why did so many people start defaulting on mortgages when that had never been the case before on this scale?

"The answer is that the mortgage lending standards were forced down by the federal government.

"Barney Frank and Chris Dodd were the leaders in this kind of thing. President Bush got into it only to the extent that he wanted to reduce the down payment that people would have to make for FHA loans. A bad idea, but he argued that Fannie Mae and Freddie Mac should be looked into and restrained because they were getting in way over their heads and Democrats in Congress wouldn't hear of it.

"President Obama says the buck stops here but the minute he gets criticized, he says, the buck stops with George W. Bush."

A caller complains that Jews constitute a disproportionate percentage of American billionaires.

Tom Sowell: "One hundred percent of billionaires in Indonesia and Thailand are Chinese (a tiny minority there).

"There's nothing strange about groups not being demographically represented at various incomes — that is the rule around the world."

Circa 2004, Barney Frank talked about "rolling the dice" more with federal government subsidies and lowered standards for the housing market.

Yet Barney Frank sleeps well at night. He'll be reelected.

Republicans and Democrats opposed regulatory oversight of Fannie Mae and Freddie Mac and now we're on the hooks for billions of dollars from the taxpayers (over $200 billion already).

My friend Karen Triggiani emails me this story:

Mortgage refinance interest rates are the lowest levels ever as 30 year fixed mortgage rates are currently around 4.25%. It is very important to remember that not all homeowners will have the ability to lock into mortgage rates this low. To get a mortgage rate below 5% homeowners will need a credit score above 740, a significant amount of equity in their home, and a debt to income ratio that is below 40%.

By not meeting these requirements homeowners will likely find that it is hard to lock into a low rate today. This does not mean that there are not opportunities to save by refinancing. The general rule of thumb is that homeowners must save at least one full percentage point to fully benefit from the mortgage refinance process.

Thanks Karen Triggiani!

With mortgage rates at historic lows – the average 30-year fixed is 4.59% – home buyers have an unprecedented opportunity to purchase a property with the best terms. These rates are, by any standard, an invitation – a highly coveted invitation – to take advantage of rates that will not stay this low forever. But getting a mortgage requires the guidance and wisdom of a seasoned expert, someone who can simplify an otherwise complex process and answer buyers' questions with intelligence and accuracy.

Mayer Dallal (www.mayerdallal.com) is such a person, a professional who has my praise and respect. In fact, I have written several posts about Mayer because I believe he distinguishes himself from the competition with his leadership and sincerity: he offers analysis that is factual and tailored to the specific circumstances of the people he advises. Translation: Mayer delivers intelligible answers to sometimes sophisticated questions, walking his clients through the financing (or loan modification, or short sale) of a home with details, explanations and thorough evidence.

If there is a recurring theme to Mayer's reputation – and one trait of his resonates powerfully with me – it is his ability to help people. Remember: each buyer has his or her own circumstances to deal with, for which Mayer develops a customized plan of action. Forget industry jargon, which exists to intimidate buyers and sellers, or quick marketing techniques, which mislead the public — Mayer transcends these tactics, and is a trusted resource.

Please call Mayer at 1-800-871-9326. I recommend him highly.

Given the popular response to my interview with Mayer Dallal
(www.mayerdallal.com), I have good news to report: Mayer just did an encore performance, where he answered a series of questions about streamline financing, a hot topic in the mortgage industry.

This announcement is important because, unlike so many real estate
“professionals” who lack the experience and wisdom to offer sound
advice, Mayer is a proven leader with a series of testimonials to his
credit. More importantly, I choose to highlight his credentials – and
I do not typically showcase individual executives in the real estate
industry – because I trust his guidance. Mayer is the real deal. What
does that mean? If you read my interview (see below) with Mayer, one
thing is undeniable: he can help people who need a trusted leader to
manage the complexity of today’s real estate market. Please call him
at 1-800-871-9326, or mayer@mayerdallal.com

1. In our last interview, you gave a lot of helpful information about
your business in general and short sales in particular. What new
issues are on your radar screen?

Now is an excellent time to discuss FHA streamline financing, because
this option allows a current FHA mortgage holder to refinance his or
her mortgage on excellent terms. Streamline financing is about getting
a great result for the borrower.

2. How is your approach to streamline financing different than the
tactics used by your competitors?

Unfortunately, many of my competitors use streamline financing as a
ploy to attract borrowers. My approach has nothing – I repeat: nothing
– to do with marketing; I know the rules governing streamline
financing, and I continue to educate borrowers about ways to take
advantage of this opportunity.

3. How does this process work?

The process is very simple. No appraisal is necessary. Borrowers must
currently have an FHA loan with a minimum of 6 months in loan
payments. Also, borrowers need a minimum credit score of 640. Best of
all, borrowers do not have to go through the whole qualification
process. I simply need a copy of one of the following, to help
potential borrowers: one paystub, bank statement, Social Security
card, driver’s license, note or deed.

4. That process is simple! Why is now such a good time to seek
streamline financing?

Rates are at historic lows. Now is the time to take advantage of this
opportunity. As I tell my current and prospective clients: get the
facts – and then take action! Streamline financing is one such way – a
power way! – to seize this opportunity.

Mayer Dallal is a residential real estate expert and commentator. He recently took the time to answer some questions about his services and various trends in his industry. Mayer can be reached directly at 1-800-871-9326, or mayer@mayerdallal.com.

Mayer Dallal is a residential real estate expert and commentator. He recently took the time to answer some questions about his services and various trends in his industry. Mayer can be reached directly at 1-800-871-9326, or mayer@mayerdallal.com.

1. Why should homeowners contact you for a short sale?

MD: With nearly two decades of experience in the real estate industry, I offer homeowners the kind of perspective that is the result of wisdom. Not theory. Not intelligence alone. Rather, wisdom is the product of success and adversity, the ability to withstand difficult challenges and better prepare for opportunities others will miss. While the economy is in turmoil – and that upheaval continues to strike individuals and families nationwide – I also know that the real estate industry will weather this storm. My outlook is not a form of naive optimism, nor a refusal to acknowledge current difficulties. On the contrary, I know that the residential real estate market will recover, because my exposure to past crises teaches me that homeowners still have many tools at their disposal that can lessen the impact of potential foreclosures or rapidly dropping prices.

Short sales are a prime example of this point: an effective tactic to leave an otherwise seemingly untenable situation. I have a lot of experience advising homeowners concerning the use of short sales. To answer the question more directly: homeowners should contact me about short sales, because – unlike many other people in this industry – I know how to accurately and effectively handle these transactions. Qualifications matter — period. To benefit from a short sale, a homeowner must qualify for this opportunity. Other individuals may offer empty promises, but I have the ability to quickly determine which homeowner can use a short sale.

2. What benefits or expertise do you offer, compared to your competitors?

MD: I personalize my services for each client I advise. Bigger companies do not take the time to learn the needs of the clients they service. In fact, bigger is often synonymous with bureaucratic; the failure to achieve quick results without any hassle or additional costs. Some of my competitors may have more staff or resources at their immediate disposal, but I execute my transactions with absolute precision and respect for my clients. To repeat: I structure solutions for each person I help. Forget all the jargon about statistics and marketing presentations; I listen to the needs of my clients. Some of their stories are inspiring, while others are, unfortunately, tragic tales of people victimized by uncertainty and sudden economic hardship. As a human being, I want to do the right thing. I expect the same from someone who counsels me: honesty, integrity and compassion. Those traits are not fads; they're standards of personal decency.

3. For first-time home buyers, why are your services the best to use?

MD: The residential real estate business can be very complex, even for industry veterans like myself. For first-time home buyers, the sheer number of choices can overwhelm most people. For example: first-time buyers are not all alike; they have different needs and different expectations, which is why I customize a program for each client I advise. I help first-time buyers navigate this process, giving them options so they can educate themselves about the benefits (and restrictions) of the various tools available to them. Other firms merely shuffle documents, and reduce prospective buyers to a series of numbers. That approach is cold and simply wrong, a disrespectful attitude to the very clients we have a duty to counsel. The lesson here is simple: give clients a variety of choices, and work with them so they find the solution that best fits their individual circumstances.

4. You handle a lot of real estate business. Please give an overview of the scope of services you offer?

MD: I offer a full array of services, from FHA loans to short sales to conventional mortgages to general real estate advice. With nearly two decades of experience as a real estate professional, I know what first-time or repeat homebuyers need. In fact, my flagship website – MayerDallal.com – contains a wealth of information about these services, along with helpful videos to guide people through the respective topics I address. Also, I work with a federally chartered bank, which enables me to close deals in approximately three weeks or less. These strengths separate me from the majority of other businesses in the residential real estate industry. Think of my services within this context: I anticipate the needs of my clients, and also have appreciation for trends that will influence my services, thereby creating an ideal business environment.

5. What are some key trends or statistics people should educate themselves about, when dealing with residential real estate?

MD: The biggest trend, right now, in the residential real estate market is short sales. Rather than succumb to foreclosure, which can have severe emotional and financial consequences, homeowners have a better option. And yet, confusion abounds concerning the use of short sales. For those who qualify – and know they qualify – short sales are an excellent way to preserve credit and get back on the road to owning a home. But a far greater number of people who qualify for short sales are unaware this tool even exists. I counsel clients about short sales all the time, fielding calls and emails about how to use this option and the broader implications involved with this tactic. I remind current and prospective clients that short sales only make sense for those who qualify. Let me underscore this point further: some unscrupulous individuals in the real estate industry continue to mislead homeowners about short sales, creating false hope and unreasonable expectations. I would rather act like a doctor than a charlatan. Which is to say, I have a responsibility to be frank but compassionate, to deliver, when necessary, bad news. If someone's financial prognosis is not good, the worst thing I can do is speak in generalities or mistruths. On the other hand, if I can help someone take advantage of a short sale then I will do everything in my power to make that happen.

6. Your sites have a lot of content. Please explain the benefits your sites provide, especially in comparison to your competitors?

MD: MayerDallal.com is my flagship website, a destination for buyers, sellers, media and people with an interest in the residential real estate industry. The site has a lot of content, segmented by specific topics and complemented by educational videos for each area of discussion. MayerDallal.com is about transparency, too; I want readers to have the same information I use, so there is no ambiguity about the services I provide. I treat my clients as my equals, which means I do not withhold information or position myself as someone who has exclusive access to proprietary intelligence. Instead, I make it clear that MayerDallal.com contains all the key facts and statistics that influence the decisions I make. The site exists for an important reason: to demystify a needlessly arcane process that gives my colleagues leverage over buyers and sellers. Forget that. MayerDallal.com is an easy-to-use site that is educational and relevant — the site is my expression of thanks to the people I serve.

7. Describe some of the audiences you help? In other words: who are your clients?

MD: My clients range from first-time homebuyers to veterans of the residential real estate market. These clients often become friends, since I invest the time getting to know these people so I can help them achieve their goals. Many times, I help clients who, quite frankly, need sound advice. Think of the situation from the perspective of, say, a first-time homebuyer: the process marks a major life change, filled with joy and apprehension, punctuated by anxiety about financing, legal costs and realtor fees. My job is to simplify this situation – and I do my best to achieve that result – so clients can focus on what really matters: a pleasant conclusion.

8. What are some your biggest successes, in terms of helping clients?

MD: As the testimonials on MayerDallal.com prove, I help people who need the guidance and wisdom of a proven real estate professional. The unsolicited testimonials on my site are both heartfelt and inspiring. These friends can attest to my ability to make a short sale happen, or my skill at finding customized financing. The point is: my successes are not about the size of a given transaction; my achievements are about restoring peace of mind for individuals who find themselves overwhelmed by economic uncertainty and needless complexity.

9. Please offer some predictions or thoughts about some notable developments you think will happen, in the short-term, for the residential real estate market.

MD: In the near future, I expect short sales to increase. As foreclosures continue to rise – the residential real estate market may experience another steep decline – short sales are, for many homeowners, the only alternative to financial disaster. There will be more news reports about short sales, more queries from potential clients about this option and more commentary about this issue in general. In such a situation, expertise will be a sought-after commodity, so people will need a trusted expert who has a lot of intelligence about the proper use of short sales. Without being too self-promotional, I think prospective clients will be happy to find me, because I already have a successful track record with short sales and other parts of the residential real estate market.