CJ VanDerMeulen

Program Will Pay Homeowners to Sell at a Loss

CJ VanDerMeulen — Mon, 08 Mar 2010 23:50:00 GMT

Program Will Pay Homeowners to Sell at a Loss

By DAVID STREITFELD

Published: March 7, 2010

In an effort to end the foreclosure crisis, the Obama administration has been trying to keep defaulting owners in their homes. Now it will take a new approach: paying some of them to leave.

This latest program, which will allow owners to sell for less than they owe and will give them a little cash to speed them on their way, is one of the administration’s most aggressive attempts to grapple with a problem that has defied solutions.

More than five million households are behind on their mortgages and risk foreclosure. The government’s $75 billion mortgage modification plan has helped only a small slice of them. Consumer advocates, economists and even some banking industry representatives say much more needs to be done.

For the administration, there is also the concern that millions of foreclosures could delay or even reverse the economy’s tentative recovery — the last thing it wants in an election year.

Taking effect on April 5, the program could encourage hundreds of thousands of delinquent borrowers who have not been rescued by the loan modification program to shed their houses through a process known as a short sale, in which property is sold for less than the balance of the mortgage. Lenders will be compelled to accept that arrangement, forgiving the difference between the market price of the property and what they are owed.

“We want to streamline and standardize the short sale process to make it much easier on the borrower and much easier on the lender,” said Seth Wheeler, a Treasury senior adviser.

The problem is highlighted by a routine case in Phoenix. Chris Paul, a real estate agent, has a house he is trying to sell on behalf of its owner, who owes $150,000. Mr. Paul has an offer for $48,000, but the bank holding the mortgage says it wants at least $90,000. The frustrated owner is now contemplating foreclosure.

To bring the various parties to the table — the homeowner, the lender that services the loan, the investor that owns the loan, the bank that owns the second mortgage on the property — the government intends to spread its cash around.

Under the new program, the servicing bank, as with all modifications, will get $1,000. Another $1,000 can go toward a second loan, if there is one. And for the first time the government would give money to the distressed homeowners themselves. They will get $1,500 in “relocation assistance.”

Should the incentives prove successful, the short sales program could have multiple benefits. For the investment pools that own many home loans, there is the prospect of getting more money with a sale than with a foreclosure.

For the borrowers, there is the likelihood of suffering less damage to credit ratings. And as part of the transaction, they will get the lender’s assurance that they will not later be sued for an unpaid mortgage balance.

For communities, the plan will mean fewer empty foreclosed houses waiting to be sold by banks. By some estimates, as many as half of all foreclosed properties are ransacked by either the former owners or vandals, which depresses the value of the property further and pulls down the value of neighboring homes.

If short sales are about to have their moment, it has been a long time coming. At the beginning of the foreclosure crisis, lenders shunned short sales. They were not equipped to deal with the labor-intensive process and were suspicious of it.

The lenders’ thinking, said the economist Thomas Lawler, went like this: “I lend someone $200,000 to buy a house. Then he says, ‘Look, I have someone willing to pay $150,000 for it; otherwise I think I’m going to default.’ Do I really believe the borrower can’t pay it back? And is $150,000 a reasonable offer for the property?”

Short sales are “tailor-made for fraud,” said Mr. Lawler, a former executive at the mortgage finance company Fannie Mae.

Last year, short sales started to increase, although they remain relatively uncommon. Fannie Mae said preforeclosure deals on loans in its portfolio more than tripled in 2009, to 36,968. But real estate agents say many lenders still seem to disapprove of short sales.

Under the new federal program, a lender will use real estate agents to determine the value of a home and thus the minimum to accept. This figure will not be shared with the owner, but if an offer comes in that is equal to or higher than this amount, the lender must take it.

Mr. Paul, the Phoenix agent, was skeptical. “In a perfect world, this would work,” he said. “But because estimates of value are inherently subjective, it won’t. The banks don’t want to sell at a discount.”

There are myriad other potential conflicts over short sales that may not be solved by the program, which was announced on Nov. 30 but whose details are still being fine-tuned. Many would-be short sellers have second and even third mortgages on their houses. Banks that own these loans are in a position to block any sale unless they get a piece of the deal.

“You have one loan, it’s no sweat to get a short sale,” said Howard Chase, a Miami Beach agent who says he does around 20 short sales a month. “But the second mortgage often is the obstacle.”

Major lenders seem to be taking a cautious approach to the new initiative. In many cases, big banks do not actually own the mortgages; they simply administer them and collect payments. J. K. Huey, a Wells Fargo vice president, said a short sale, like a loan modification, would have to meet the requirements of the investor who owns the loan.

“This is not an opportunity for the customer to just walk away,” Ms. Huey said. “If someone doesn’t come to us saying, ‘I’ve done everything I can, I used all my savings, I borrowed money and, by the way, I’m losing my job and moving to another city, and have all the documentation,’ we’re not going to do a short sale.”

But even if lenders want to treat short sales as a last resort for desperate borrowers, in reality the standards seem to be looser.

Sree Reddy, a lawyer and commercial real estate investor who lives in Miami Beach, bought a one-bedroom condominium in 2005, spent about $30,000 on improvements and ended up owing $540,000. Three years later, the value had fallen by 40 percent.

Mr. Reddy wanted to get out from under his crushing monthly payments. He lost a lot of money in the crash but was not in default. Nevertheless, his bank let him sell the place for $360,000 last summer.

“A short sale provides peace of mind,” said Mr. Reddy, 32. “If you’re in foreclosure, you don’t know when they’re ultimately going to take the place away from you.”

Mr. Reddy still lives in the apartment complex where he bought that condo, but is now a renter paying about half of his old mortgage payment. Another benefit, he said: “The place I’m in now is nicer and a little bigger.”

Price Reduced on 27775 Alpen Dr. in Arrowhead Woods

CJ VanDerMeulen — Mon, 08 Mar 2010 21:30:00 GMT

Arrowhead Woods, Lake Arrowhead - Announcing a price reduction on 27775 Alpen Dr., a 2 story. Now MLS® $240,000 - LAKE VIEWS!

Property information

Price Reduced on 28216 North Bay in Arrowhead Woods

CJ VanDerMeulen — Wed, 17 Feb 2010 21:51:00 GMT

Arrowhead Woods, Lake Arrowhead - Announcing a price reduction on 28216 North Bay, a 2 bath, 3 bdrm single story. Now MLS® $349,000 - Price Reduced $20,000!.

Property information

Lake Arrowhead Real Estate Trends

CJ VanDerMeulen — Thu, 28 Jan 2010 00:14:00 GMT

In December 2009, the median selling price of home in Arrowhead Woods was $343,500. This represents a 5% decrease from December 2008 and a 15% increase from November 2009. There were 34 homes sold in December which was 161% more than December 2008 and 26% more than Novermber 2009. There are approximately 260 active listings in Arrowhead Woods and many more in the surrounding Mountain Communities.

Year end numbers- In calendar 2009, the median price of a home sold in Arrowhead Woods was $322,000 this was 16% less than calendar 2008. In 2009, 284 homes sold in Arrowhead Woods this represented a 17% increase over 2008.

For more infromation, email CJ at cj@sellingmountainhomes.com or call her directly at 909-456-6119.

Price Reduced on 357 Pioneer Rd. in Arrowhead Woods

CJ VanDerMeulen — Fri, 15 Jan 2010 18:45:00 GMT

Arrowhead Woods, Lake Arrowhead - Announcing a price reduction on 357 Pioneer Rd., a 1,300 sq. ft., 2 bath, 3 bdrm single story. Now MLS® $279,000 - HUGE Price REDUCTION!.

Property information

28927 Potomac Dr. in Arrowhead Woods is Sold!

CJ VanDerMeulen — Fri, 15 Jan 2010 18:44:00 GMT

Arrowhead Woods, Lake Arrowhead - The 3 story at 28927 Potomac Dr. has been sold.

Property information

Peak of the Lake For Sale in Arrowhead Woods!

CJ VanDerMeulen — Fri, 08 Jan 2010 22:42:00 GMT

• 2 story - MLS® $247,000 - New Listing!

Arrowhead Woods, Lake Arrowhead - Lake View Bavarian in Great area! Large and fairly level lot approximately 15,000 sq.ft great for kids and pets. Home has 3 Bedrooms and 2 Bathrooms and walking distance to the Lake!

Property information

Walk to Tavern Bay in Arrowhead Woods!

CJ VanDerMeulen — Fri, 20 Nov 2009 01:21:00 GMT

Dr. Laura's Former Retreat!

• 2 bath, 3 bdrm single story - MLS® $369,000 - New Listing!

Arrowhead Woods, Lake Arrowhead - Dr. Laura's Former Retreat! Beautiful inside and out and walking distance to Tavern Bay! This gorgeous home features the popular Open floor plan, Vaulted ceilings covered in tonge and groove, lots of light from a Wall of Glass, up dated open kitchen, 2 fireplaces, separate game room with wet bar, two decks, large level usable yard with Hot Tub and potential to build a garage. Park 3 or more cars or park your RV. A must see!

Property information

New LISTING 434 Bel Air Drive in Arrowhead Woods!

CJ VanDerMeulen — Tue, 17 Nov 2009 02:31:00 GMT

Arrowhead Woods, Lake Arrowhead - Property information

Located in a popular golf course side neighborhood! This home features all on one level, Vaulted Ceilings covered in tongue and groove, walls of glass, remodeled kitchen including new counter tops, new appliances, new lighting,new flooring, new roof, new decks and new stairs. The word here is NEW! Come see and be in by Christmas!

Price Reduced on 28927 Potomac Dr. in Arrowhead Woods

CJ VanDerMeulen — Tue, 17 Nov 2009 01:44:00 GMT

Arrowhead Woods, Lake Arrowhead - Announcing a price reduction on 28927 Potomac Dr., a 2,150 sq. ft., 3 bath, 3 bdrm 3 story. Now MLS® $379,000 - Price REDUCED!.

Property information

Price Reduced on 1333 Yellowstone in Arrowhead Woods...Lake VIEW!

CJ VanDerMeulen — Tue, 17 Nov 2009 01:42:00 GMT

Arrowhead Woods, Lake Arrowhead - Announcing a price reduction on 1333 Yellowstone, a 3 bath, 4 bdrm 3 story "Ben Naraghi Built Home!". Now MLS® $699,000 - Price Reduced!.

Property information

Price Reduced on 357 Pioneer Rd. in Arrowhead Woods

CJ VanDerMeulen — Tue, 10 Nov 2009 20:04:00 GMT

Arrowhead Woods, Lake Arrowhead - Announcing a price reduction on 357 Pioneer Rd., a 1,300 sq. ft., 2 bath, 3 bdrm single story. Now MLS® $299,000 - HUGE Price REDUCTION!.

Property information

Price Reduced on 28927 Potomac Dr. in Arrowhead Woods

CJ VanDerMeulen — Tue, 10 Nov 2009 17:04:00 GMT

Arrowhead Woods, Lake Arrowhead - Announcing a price reduction on 28927 Potomac Dr., a 2,150 sq. ft., 3 bath, 3 bdrm 3 story. Now MLS® $389,000 - Price REDUCED!.

Property information

News from Lake Arrowhead Nov. 9, 2009!

CJ VanDerMeulen — Tue, 10 Nov 2009 16:56:00 GMT

Monday Morning Update
November 9, 2009

Mountain Skies

November 14, 2009, MSAS Astronomy Village

Enjoy an evening at the Mountain Skies Astronomical
Society's Astonomy
Village on Sat. Nov. 14 from 7-9pm! Subject: Winter Constellations.

MSAS Astronomy Village is located at
2001 Observatory Way, off Hwy. 18
(West of Rim of the World High School)
For more information please call: 909-336-1699 or visit their website:
www.mountain-skies.org

Lake Arrowhead Repertory Theatre

November 13 - 15, 2009
Please join the Lake Arrowhead Repertory Theatre Company for two New American Short Plays. "Big Dog" by Shawna Frey and "Rain Man" by Peter Floria. These plays will be held at the theater in Crestline. For more information contact (909) 744-8114 or lakearrowheadrep.org

Shop 4 Charity Craft Boutique

November 27 & 28
It's Operation Provider's 6th Annual Shop 4 Charity Craft Boutique on the Friday & Saturday of Thanksgiving Weekend from 9am till 2pm. This annual event will be held at the Twin Peaks Senior Center. For more information, please call 909-337-8585

Holiday Tree Lighting

November 27, 2009

Holiday Tree Lighting Ceremony in Lake Arrowhead Village. The Tree Lighting Ceremony will be at 7pm at Center Stage.
Visit with Santa from 6 to 9pm.
For more details please call: 909-337-2533

Committee Meetings

Governmental Affairs:
Tuesday December 1, 2009 8:00 am Chamber Board Room

Your Chamber Staff

Lewis Murray
President, CEO

Leslie Saint McLellan
Director of Marketing and Tourism

Ariane Ingham
Skyforest Visitor's Center Manager

Cindy Darling
Visitor Information Specialist

Paula Arthur
Visitor Information Specialist
Joanne Collura
Visitor Information Specialist

Robyn Hottenroth
Bookkeeper

Margie Smith
Welcome Program Coordinator

Lois Scott
Welcome Hostess

November Mixer @ Vino100

November 12, 2009
Vino100 hosts the November Mixer and Block Party

Vino100 will be hosting the Lake Arrowhead Communities Chamber of Commerce November Mixer on Thursday, November 12th, from 5:00 p.m. - 7:00 p.m. at their wine store in Lake Arrowhead Village. Along with Vino 100 their "Block Party" will include Basix, The Tea Exchange, Rocky Mountain Chocolate Factory and In the Woods. Please join us for a fantastic evening with great food and beverages being served at all of the wonderful block party stores, an opportunity drawing and a chance to be next month's Member of the Month.

Please bring your business cards as this is also the perfect time to network. For more information, please call the Chamber at (909) 337-3715

Sundays with Santa

November 15, 2009, 1:00 - 4:00 pm
Everyone is invited to the Santa's Village exhibit at the the Rim of the World Historical Society Museum to visit Santa for a pre-Christmas checkup & write a letter to drop in his mailbox!
Sunday, November 15 from 1-4 pm. Have a photo taken & put into a commemorative folder for $5.00! Browse the museum, located at the old fire station at 27176 Peninsula in Lake Arrowhead, & view other exhibits taking shape! For more
information please call: 909-338-0225

Mountain Arts Gallery

November 21, 2009
Mountain Arts Network Presents:
Gallery Spotlight · Featured artist Michael Bates. Artist's Reception Saturday November 21, 2009 - 4pm to 8pm

Come and join us for an evening of art!

Michael Bates
Otis Parsons School of Art, Bachelor of Arts, Point Loma Nazarene University. Michael enjoys all types of photography from digital art to family portraits but really enjoys shooting wildlife and scenic images. His favorite wildlife subjects are the Bald Eagles that winter near his local home. Michael has also done extensive field work in other states.

Mountain Arts Gallery
Gallery Hours Noon to 4pm · Thursday - Sunday. 28561 Highway 18, in Sky Forest
www.MountainArtsNetwork.org

Lake Arrowhead Repertory Theatre

November 21, 2009, 7:30 pm

At the Crestline Village Theater

The George Whitty Trio brings together 3 of Southern California's most accomplished musicians playing an intense, yet melodic brew of electric jazz and world music.

General Admission $12; Senior/Student $10; 5 and Under are Free

Available online at Brownpapertickets.com and at Betty's General Store, The Lake House, Vino 100, and Lake Gregory Coffee Co.

For more information, call 909-744-8114

Taste of Lake Arrowhead

Taste of Lake Arrowhead Returns
Wednesday, December 2

The Annual Taste of Lake Arrowhead returns to the Lake Arrowhead Resort and Spa on Wednesday, December 2nd. From 5:00 pm - 8:00 pm Taste attendees can stroll the main level of the Resort tasting samplings from a variety of our local restaurants.

The Taste of Lake Arrowhead kicks off the holiday season with the lighting of the Resort Christmas Tree. Besides the wonderful food, there will also be desserts, wine tastings and entertainment. This is one of the premier events of the year so mark your calendars now!

The cost is $25 per person and each attendee is asked to bring either a toy, gift card or bag of food for Operation Provider as this event is held to help this wonderful organization. Last year the Chamber added a new feature to the "Taste" - 3 People's Choice Awards that attendees vote on. The categories include:
1. Best of the Taste of Lake Arrowhead 2009
2. Dish of the Year 2009
3. Most Creative Display 2009

To make reservations, please contact the Chamber at (909) 337-3715 or purchase tickets online at http://tasteoflakearrowhead.eventbrite.com

Blue Jay Christmas Parade

Mark Your Calendars!

The Annual Blue Jay Christmas Parade is scheduled for Saturday, December 5, 2009 at 2:00 pm.
Don't miss the "BEST" community activity on the Mountain.
Details and registration information to follow.
http://www.bluejayvillage.com

Business Journal

Use this link to view this month's edition of the Lake Arrowhead Communities Chamber of Commerce Business Journal:

http://www.lakearrowhead.net/BJ%20November09Web.pdf

Taste of Lake Arrowhead!

CJ VanDerMeulen — Tue, 10 Nov 2009 16:42:00 GMT