The Real Estate Bloggers

Florida Foreclosure Attorney Loses Freddie Mac and Fannie Mae Business

Posted: 03 Nov 2010 09:15 PM PDT

The Law Firm of David J. Stern was terminated by Freddie Mac and Fannie Mae on Tuesday. The foreclosure powerhouse in the state of Florida handled 70,000 foreclosures in the past year. The mortgage giants had concerns over how the firm was conducting some of their practices.

Now I am not going to delve much deeper into this issue as it is a law firm with a bunch of lawyers that have time on their hands, but this is going to be an interesting situation to follow. With all the news about foreclosure processing being done incorrectly and the big banks having to stop foreclosure processes for a while, proper procedures has been a hot topic in the real estate community.

Processing 70,000 foreclosures a year is a daunting task for any firm. The level of paperwork and scrutiny to comply with all of the legal requirements is a monstrous task for even one foreclosure. I hope that it all works out as the movement of files and representation is going to leave thousands of Floridians in limbo until this all gets settled.

A spokeswoman for Freddie Mac, Sharon McHale, said it took the rare step on Monday of beginning to remove loan files after an internal review raised “concerns about some of the practices at the Stern firm.” She added that Freddie Mac took possession of its files “to protect our interest in those loans as well as those of borrowers.”

The Stern law firm has been at the center of allegations by the Florida attorney general’s office of improper foreclosure practices and is one of four firms under state investigation. The office has released depositions of former law-firm employees who have alleged that the firm forged notarized documents and that employees signed files without reviewing them in an effort to speed through foreclosure filings. via The WSJ

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Florida Foreclosure Attorney Loses Freddie Mac and Fannie Mae Business

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Home Ownership Down To Lowest Level in Decade

Posted: 03 Nov 2010 05:57 AM PDT

Moneyhousescale Home ownership is down to it’s lowest level in a decade.

We should be happy.

This is going to sound antithetical to most real estate industry folks, but it is the truth. Home ownership is not designed for everyone, and for many it is a curse not a blessing.

The cost of a home is more than just the mortgage. Property taxes, repairs, maintenance, and insurance are costs that add up for the homeowner. When a lifelong renter buys a home they have never had to worry about these costs, they were always “included in the rent.”

The landlord typically had a strong cash position on the property so that the other costs could be absorbed in the rent and still be profitable. But for the lifelong renter who now owns the property these costs can be overwhelming.

Social programs coming from Washington and supported by Fannie Mae and Freddie Mac created the concept that improving home ownership was a right and a noble goal for all of us. But as the meltdown of the real estate market has shown, it has been a devastating blow for millions of families.

So as the home ownership levels regress back to their traditional levels, celebrate and do not mourn the transition.

It truly is better for all of us in the long run.

Nearly 3 million fewer Americans now own homes compared to the first quarter of 2005, when homeownership peaked at 69.1%, the Census Bureau found. During the third quarter of 2010, the homeownership rate was down to 66.9%, unchanged from a quarter earlier. That’s the lowest rate since the second quarter of 1999.

Meanwhile, a great number of homes sit empty. For owner-occupied homes, the vacancy rate remains at 2.5%, the same as in the second quarter, but well up from the sub-2% levels seen mid-decade.

For rental properties, the vacancy rate actually dropped in the third quarter, to 10.3% from 10.6% three months earlier. But that’s still up from the 9.9% rate of 24 months ago.

“There’s a big inventory glut out there and it’s probably worse than reported,” said Pat Newport, an analyst with IHS Global Insight. “The data is muddled because they don’t account for foreclosures not for sale.”

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Home Ownership Down To Lowest Level in Decade