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Foreclosures to persist
According to authors at the Federal Reserve Bank of Cleveland, the nation’s high foreclosure rate is likely to persist. The Fed article looks at the changes in foreclosure and unemployment rates across states, noting the differences in the timing of the movements. The conjecture that the high foreclosure rate will persist is based in part on the observation that states that experienced boom-bust housing cycles in the past (Texas, Oklahoma, Massachusetts and California) had elevated foreclosure starts for years after the peak in foreclosure starts and inventory. These previous boom-bust cycles “were small in comparison to the current cycle,” the article said. While the recession has left deep scars in the housing and labor markets — with the unemployment rate doubling and the foreclosure start rate roughly tripling — the timing of the movements differs over the cycle, according to the abstract, written by the vice president at the Federal Reserve Bank of Cleveland, and K.F., a research assistant.
In So-Cal every Wednesday morning there is a short sale workshop open to the public, allowing homeowners, agents, brokers or investors the opportunity to see and participate in how and why this has been changing communities across our nation. Join us this week or any week for a fulfilling chance at making a difference in the lives of others.
BofA Agrees to Pay $108 Million to Overcharged Countrywide
Borrowers Representing one of the largest judgments imposed in a Federal Trade Commission (FTC) case, two Countrywide mortgage servicing companies, now part of Bank of America Home Loans, have been ordered to pay $108 million to settle charges that they collected excessive fees from cash-strapped borrowers who were struggling to keep their homes. In a statement released Monday, the FTC said the $108 million settlement will be used to reimburse overcharged homeowners whose loans were serviced by Countrywide before it was acquired by North Carolina-based Bank of America in July 2008. Bank of America said it agreed to the settlement “to avoid the expense and distraction associated with litigating the case.” According to the FTC, Countrywide used unlawful practices in Servicing homeowners’ mortgages.
The company allegedly charged excessive fees for default-related services, made claims about amounts owed by homeowners in bankruptcy that were false or couldn’t be backed up, and didn’t tell people going through bankruptcy when new fees or charges were being added to their loans. Going forward, borrowers in Chapter 13 bankruptcy must be sent a monthly notice with information about what amounts are owed – including any fees assessed during the prior month. Additionally, the defendants must implement a data integrity program to ensure the accuracy and completeness of the data they use to service loans in Chapter 13 bankruptcy.
Demonstrate the ability to pay the loan and you are halfway toward becoming a commercial investor. Critical is an understanding of the major risks associated with commercial loans from the lenders perspective. Use this as a quick checklist when putting together an offer or evaluating your own potential.
1. Credit Risk. Perhaps the most common type of risk, this simply indicates the ability of the borrower to meet the contractual obligations as outlined in the loan documents…aka, the ability to pay. However, because you are dealing with commercial loans, the credit risk can be impacted by several items including competitive market factors (ie, the inability of the property to lease as expected, increased or decreased demand etc), interest rate sensitivity, rollover of leases (long term leases may be stable but are also more prone to declining values), changes in regulatory environment including zoning and tax laws.
2. Interest Rate Risk. The majority of commercial real estate is financed on a floating rate basis so interest rate risk is a very real threat depending upon the timing of cash flows, yield curves and other economic conditions that may adversely impact the economic climate.
3. Liquidity Risk. Banks must meet obligations the same way that private individuals are required to do so; loss of liquidity means the bank is unable to extend credit or must call loans in order to raise capital. For an investor, liquidity risk is typically isolated to the ability of the bank to loan money in the future should you require it in order to roll-over or refinance a loan.
4. Compliance Risk. Once the domain of elusive economic theory, compliance risk has risen to disproportionate levels thanks in large part to the current crisis as well as outside influences. Examples are broad but range from potential liability of bad debts during the mortgage boom to the current oil spill at BP; a bank may be held responsible for assets held as collateral. High risk assets will be assessed a premium.
Real estate investors seeking entry into the exciting world of commercial real estate should review each property from the perspective of the lender; examine risk levels and potential threats through the eyes of the bank in order to maximize your prospect for success.
Commercial Market Still Struggling
While the commercial real estate market may not have fully recovered, National Association of Realtors Chief Economist Lawrence Yun identified some developing, positive trends in the market that could eventually lead to recovery at the “Economics Issues and Commercial Business Trends Forum.” Yun said jobs only began increasing a couple of months ago and are still below peak. The commercial market has seen a few improving trends in recent months. The market is experiencing an increase in transactions due to more distressed properties available needing various levels of plumbing repairs IE., and prices are beginning to stabilize. Yun believes within the next year more lending will slowly become accessible to commercial property owners.
Two commercial sectors showing the most promise are manufacturing and multifamily. Manufacturing activity and employment have risen recently and because household formation is also rising, the multifamily sector will likely fare the best during this economy. Despite some of these promising trends, the commercial market is still experiencing high vacancy rates and rent concessions. “All real estate is local, but I expect to see vacancy rates bottoming out and rent rising by next year,” said Yun. He also warned against some of the possible risks commercial practitioners may experience in the future such as high interest rates and inflation, as well as increased taxes for commercial real estate investors. During the session, Yun was joined by two leading economic experts, Diane Swonk, Mesirow Financial; and Brendan Reilly, Commercial Mortgage Securities Association. The panelists agreed that an improving economy and job creation continue to be the two main factors when it comes to restoring the commercial real estate market.
Look for more short sales coming in 2010.
#3. Commercial Real-Estate Collapse: The second
largest chain of malls has already declared
bankruptcy. Obligations needing refinancing
in the commercial market are in the trillions.
And most of them, even with positive cash flows, 
*Tile Flooring, ceramic and
are as underwater as residential mortgages. As vinyl tiles highly prevalent in commercial loans default and commercial
these businesses crash, they will cause even building’s and will see a huge
more unemployment. uptick in sales as TI’s will
consider this and control the marketplace..
look for more short sales coming in 2010.
#4. Loan modifications aren’t working. Unless
and until there is meaningful principal reduction,
most people getting a loan modification will stop
making their payments if they are $100,000+
upside down on their home. And there are A LOT
of people upside down. Look for lots of “jingle
mail,” where the homeowner just sends back the
keys.
Look for more short sales coming in 2010. But look
for a lot more buyers now that FHA has given the
green light.
Are you seeing a theme yet?
Look, you can either be a victim of this economy,
or you can swing it to your advantage by learning
the easy way to find and rapidly resell short
sales.
Yep, I said easy, because with our newly revised
Short Sales Riches system for 2010, it’s done for
you automatically. You just have to get the
machine started, then it runs on autopilot for you.
With defaults continuing to mount and declining property values still widespread, the industry is seeing an increase in short sales. Such transactions are expected to burgeon even further now that the federal government has implemented its Home Affordable Foreclosure Alternatives (HAFA) program. With the new policies and still-precarious market conditions, short sales are gaining in popularity among lenders and distressed homeowners alike, but as with any modus operandi that rapidly picks up steam, this proliferation can open the gate for fraudulent activity. Experts say one area of the short sale process particularly vulnerable to fraud is property valuation. Bank-owned fraud attributed directly to schemes involving short sales and REO inventories has increased by 40 percent over the past year and has more than doubled from two years ago, according to market data from the California-based risk mitigation firm Interthinx.
Will you know the first step in helping others out of a bad place, start today by investing in your community and earn a very large income, for doing just this. Today can be the start of a great opportunity, when you apply yourself in obtaining knowledge in DIY REO Short Sales!
The average home will be sheathed with a 3 ply 1/2″ cdx plywood that can span 24″ centers for the roof rafters, 1/2″ plywood has been facilitated in home construction roofs for quite some time, and generally found the least expensive common sheeted material in your local lumber yards and home improvement stores. 
Are you a commercial CADS manager?
Plywood is a manufactured wood, made by gluing together a number of thin veneers or plies of softwood or hardwood. A common reason for using plywood instead of plain wood is its resistance to cracking, shrinkage, twisting/warping, and its general high degree of strength. Also, plywood can be manufactured in sheets far wider than the trees from which it was made. It has replaced many dimensional lumber on construction applications for these reasons.
Another 1/2″ plywood product most generally used on panelized roof systems, or commercial construction roofs such as Wal-Marts or Home Depot roof structures, where 3-1/8″x 18″ sub laminate [glu-lams] beams spanning 20′ or so, between larger Glu-lams that can span 40′ or so. These mini lams are on an 8′ centers layout with 2x stiffeners, 24″ centers, fastened with hardware [stiffy hangers] and then sheathed with a 1/2″ struct one plywood sheet, this material is a 5 ply material that can span length wise over 2 foot centers with the ability to not flex much or give under normal live load weights. Plywood has certainly change building norms, and in some cases fire retardant when called for. Next time standing in line at your busy home improvement warehouse store, look up and you will see exactly what we are saying here….
Its time again to jump on the train, this train will give you the training required to succeed in helping others help you by obtaining the necessary TOOLS you”ll want to DIY your way to the top!
Wake up to new opportunity – this Saturday, April 24th, at 11am ET – with Independent Regional Associate Jason Andrus!
Growing up in Southeast Idaho, Jason A. worked hard for his family’s trucking company. He thanks his parents for instilling a strong work ethic in him, but the ups and downs of the family business left him craving the stability of a good job with excellent benefits. After climbing the seniority ladder for another company and landing his “dream job” that quickly turned into a nightmare, he sought a new path with real estate investing and stumbled across a great wealth building system that works. Utilizing their educational system, Jason and his wife, IRA Shelley A., completed their 10 year plan in only 1 year – owning 4 homes and 1 four-plex- and were able to fire their bosses! Not only have they grown a profitable investment portfolio, they’ve also earned a tremendous massive income by introducing others to the educational system!
This Saturday morning, invite your guests to sit back and relax as Jason reveals how you can too build a dual-income opportunity that could change your world, too!
City, county and states vary with there code requirements for a justifiable answer to ” what is a fire wall”. And exacts are not always given. In a multi-family dwelling these codes will fluctuate as well, depending on what year they were constructed. Ultimately this system of constructing a building that has a definite form of separation is in fact where the fire wall(s) are located, between units of habitable space. Condo’s may have them and some apartment structures may have them as well. Most likely a true fire wall can be noticed from the street the building is on. And knowing how to spot them is the key to a successful venture into managing your CADS. ![attic firewall construction [condo]](http://www.my-diy-blog.com/wp-content/uploads/2010/04/thumbnail-2.jpg "attic firewall construction [condo]")
A one hour wall typically consists of a single layer of 5/8″ drywall [gypsum board] for meeting code requirements. If a building has an attached garage, the the inside of the parking garage area must comply with a minimal fire rating of drywall with any proper electrical components involved. A two hour fire wall may often require a double layer of 5/8″ drywall or sheetrock on the garage side to accomplish this rating. Drywall compressed gypsum is considered to be fire resistant and allows ample time for the UBC safety laws, to extinguish any flames before moving [burning] through to the next area, therefore lessening the damage, it can potentially cause. Are you a CADS manager?
There are two main classifications of fire walls: fire partitions, and true fire walls. To the layperson, the common use of firewalls are to slow down the fire’s ability to spread, also known as a 1 hour rated partition.
There is a further sub-classification of fire walls. A high challenge fire wall is a wall used to separate buildings or subdivide a building with high fire challenge occupancies, having enhanced fire resistance ratings and enhanced appurtenance protection to prevent the spread of fire, and having structural stability.
Portions of structures that are subdivided by fire walls are permitted to be considered separate buildings, in that fire walls have sufficient structural stability to maintain the integrity of the wall in the event of the collapse of the building construction on either side of the wall. Are you a CADS manager? Do you aspire to be?
Fire barrier walls are continuous from an exterior wall to an exterior wall, or from a floor below to a floor or roof above, or from one fire barrier wall to another fire barrier wall, fire wall, or high challenge fire wall having a fire resistance rating of at least equal rating as required for the fire barrier wall. They are continuous through all concealed spaces (e.g., above a ceiling), but are not required to extend through concealed spaces if the construction assembly forming the bottom of the space has a fire resistance rating at least equal of the fire barrier wall.