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Showing posts from March 18, 2009

MORE EVIDENCE OF THE REO GLUT

According to Inman this morning,

"Fannie Mae and Freddie Mac boosted loan modifications by 76 percentin the last three months of 2008, but nearly doubled their inventories of real estate-owned properties over the course of the year as the companies eschewed short sales and seized properties faster than they could sell them." Here is another new report that helps quantify how many properties are being held "bank-owned" following foreclosure. Among the findings:

The companies were saddled with real estate-owned (REO) inventory of 92,884 homes at year end, 2008 -- nearly twice the 48,123 properties on hand at the end of 2007. During the last three months of 2008, loan modifications were approved for 23,777 loans owned or guaranteed by Fannie and Freddie, a 76 percent increase from the previous three months. But over the course of the year, the mortgage giants repossessed about eight homes for every short sale they conducted. Fannie and Freddie's loan servicers agree…

(EVEN) Tougher Sledding for New Construction Condo Projects

According to today's Wall Street Journal (subscription required)

Fannie Mae has tightened credit for buyers of condominiums. The new rules are going to hit new construction condo buildings especially hard. Effective as of March 1:Has stopped guaranteeing mortgages in condo buildings where fewer than 70% of the units have sold (previously it was guaranteeing the loans as long as at least 51% had sold)Won’t back loans for sales in buildings where 15% of current owners are deliniquent on HOA feesWon’t back loans where more than 10% of units in the building are owned by a single entityFreddie Mac has apparently not tightened its lending standards- yet.Both Freddie and Fannie, however, are going to increase fees.Starting in April, buyers without at least a 25% down payment will have to pay closing-cost fees equal to 0.75% of their loan even if the buyer has an outstanding credit score.