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America’s Foreclosure Crisis Isn’t Over Yet

Posted on March 9, 2016by Admin

Goldman Sachs is the latest big bank to settle claims related to its role in the 2008 housing crisis. The global investment bank reached a deal with the U.S. government, agreeing to pay $5.1 billion as part of the settlement. Nearly $2 billion of which will be set aside for programs to help struggling homeowners avoid foreclosure.

During the height of the financial crisis, the government’s top priority was backstopping the nation’s banking system. Congress authorized $475 billion for the Troubled Asset Relief Program (TARP). Approximately $46 billion of that was allocated to programs to help struggling homeowners avoid foreclosure.

Tens of billions of dollars were also set aside following a string of settlements between the government and a number of Wall Street banks, including Bank of America. These funds were put into programs such as the Home Affordable Modification Program (HAMP) to provide relief to homeowners.

Eight years after the housing bubble burst, foreclosures and underwater mortgages are down nationally. However, there are several areas and states that are still struggling. In 2013, Christy Goldsmith Romero, special inspector general for TARP, warned that homeowners were defaulting on their modified loans at an “alarming rate.” Data released in September of 2015 revealed the rate of defaults on the reset mortgages increased greatly over time. Romero’s office released a statement that said, “The longer a homeowner remains in HAMP, the more likely he or she is to re-default out of the program.”

Between 2009 and 2015 nearly 2.2 million homeowners applied for a trial modification but nearly 786,000 canceled. Out of the remaining 1.4 million granted HAMP modifications through the Treasury Department, approximately 467,000 re-defaulted.

According to thousands of calls and complaints received on the Special Inspector General TARP hotline (SIGTARP), banks and mortgage servicers are to blame for the high default rate. Homeowners claim that the banks lost paperwork and made clerical errors resulting in defaulted mortgages. According to SIGTARP, “dual-tracking” is also an issue. This is a practice where the servicer of the HAMP mortgage continues to pursue foreclosure while the homeowner is in the HAMP program.

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Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Bankruptcy Law, Foreclosures, Timothy Kingcade Posts

Underwater Mortgages Decline in South Florida

Posted on March 25, 2015by Admin

Recent data collected by Zillow.com shows that underwater mortgages, meaning homeowners who owe more than their home is worth, are declining in South Florida. Sixteen percent of homeowners in Palm Beach County are currently underwater on their mortgages. The previous year there were twenty four percent underwater. Nineteen percent of Broward County’s mortgages are underwater, down from twenty five percent in the fourth quarter of 2014.

Home values are on the rise in South Florida and as a result, negative equity is declining since its peak of forty percent in 2011. Negative equity occurs when the value of an asset, such as a home, falls below the value of the outstanding loan balance.

Another factor that real estate experts attribute to the decline in underwater mortgages is the decline in foreclosures in South Florida this year. According to analysts, South Florida is recovering better than most markets across the country since the housing bubble burst in 2008.

Click here to read more about the decline of underwater mortgages in South Florida.

Foreclosures, Timothy Kingcade Posts

Mortgage Forgiveness Debt Relief Act Set to Expire: Underwater Homeowners will likely Face New Tax Bill

Posted on December 19, 2013by Admin

Beginning in January, homeowners with “underwater” mortgages will likely face a new tax bill if they sell their house, modify their mortgage or lose their home in foreclosure. The 2007 federal law that waived income taxes on unpaid mortgage debt is set to expire December 31, 2013.

Without the waiver, homeowners will be forced to pay income taxes on any mortgage amount forgiven by the lender, including foreclosure. Homeowners also will have to pay tax on mortgages that are unpaid because of a short sale or a loan modification, which lowers monthly payments. So this means that a typical homeowner who sells a house for $100,000 but still has a $200,000 mortgage could face a tax bill of $28,000.

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Foreclosures, Timothy Kingcade Posts

South Florida Home Prices Increase Giving Underwater Homeowners a Sense of Hope

Posted on December 10, 2013by Admin

South Florida home prices have increased by more than 20 percent in the past year, giving many underwater homeowners a sense of hope. According to Zillow.com, in the third quarter alone, more than 25,000 homeowners in Broward and Palm Beach counties saw their home values rise above what they owed, freeing them from “underwater” mortgages.

After peaking at $391,100 in November 2005, Broward County’s median home price plunged by more than 50 percent by the time the market finally hit bottom in early 2012. Palm Beach County’s peak median, $421,500, fell by nearly 60 percent for the same period. The steep declines, unleashed a wave of foreclosures. Many underwater homeowners opted for short sales, others were just stuck, continuing to make mortgage payments and unable to sell.

The market began to stabilize when investors and other buyers began looking for bargains. This rush eventually forced housing prices back up. Median prices in Palm Beach and Broward counties have jumped by double digits in every month this year, though the year-to-year increases have slowed since the summer. Analysts expect home values to appreciate closer to the traditional 4 percent a year by 2014.

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Credit, Foreclosures, Timothy Kingcade Posts

Walking Away from your Underwater Mortgage Becoming More Socially Acceptable?

Posted on December 24, 2012by Admin

Five years after the mortgage crisis and the housing bubble burst, more Americans are deciding that it’s okay to walk away from their underwater mortgage payments. In a recent survey conducted by JZ Analytics for ID Analytics, 32% of more than 1,000 respondents said they “believe homeowners should be able to strategically default on their mortgages without any consequences.”
Today, there’s obviously still a social stigma to walking away from an underwater home, given that the other two-thirds of respondents didn’t find it acceptable. In addition to shame and guilt, people also have to face a sense of loss, since most people are emotionally attached to their homes. There are practical considerations, too: the stress of being hounded by collectors, the knowledge that you are ruining your credit, and the possibility of being sued by the lender.
There is also community pressure to avoid foreclosure. Defaults can hurt nearby property values a 2010 study revealed. Despite all of this, attitudes have clearly changed. The idea that only ‘deadbeats’ default on their mortgage payments is a thing of the past. The ID Analytics survey found that 17% of Americans know someone who has strategically defaulted on a mortgage. What’s more, many people now recognize that companies are often able to declare bankruptcy and either shed or restructure their debts without long-term consequences.
To read more on this story visit: http://business.time.com/2012/10/15/is-the-stigma-of-ditching-your-underwater-mortgage-fading/?utm_source=contactology&utm_medium=email&utm_campaign=InChargeInsiderMarch
Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Foreclosure defense attorney, Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia, P.A. website at www.miamibankruptcy.com.