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Five Things To Ask At An Open House

by The Cope Real Estate Team

As a real estate agent, I understand the allure of open houses. Even if you’re still in the “just looking” phase, here is a list of questions to ask the seller’s agent at the next open house you attend.

  1. Why are the sellers moving?
    Their answer may give you an idea about how motivated the sellers are.
  2. What is the neighborhood like?
    The house may be perfect, but remember that you’re buying into a neighborhood. Get information on the schools, local amenities, things to do in the area, noise level and whether the property is subject to homeowner’s association dues.
  3. Have there been any offers?
    The answer will tell you how many other buyers you’re in competition with. If there have been offers, you may want to ask about the timeline so you can make your bid in time to be considered. The number of offers also tells you whether to submit your best offer first, or bid competitively.
  4. What are utilities like at this house?
    The cost of utilities can be a large chunk of your monthly expenses. Or, it may come as a pleasant surprise that the home comes with energy-efficient appliances.
  5. May I take pictures?
    It’s good etiquette to ask before you take pictures, particularly if the current homeowner is still living there. This is important for the homeowner’s privacy and security. If nothing else, the agent will appreciate it and you’ll be off to a good start if you decide to make an offer!

Contact The Cope Real Estate Team with your questions, or if you need assistance with your home search! We will help you sell your current house and find a new home.

One-Story vs. Two-Story Home: Which Is Better?

by The Cope Real Estate Team

When house hunting, this question is worth considering—and the answer isn't as simple as you might think. The number of floors in a home affects not just the way it looks, but also how easy it is to navigate and maintain, how much you'll pay for heating and cooling, and much more.

Just so you know what you're in for based on the number of stories you buy (or build), consider this list of the pros and cons of one-story versus two-story homes.

One-story homes: Pros and cons

Whether you have your eye on a ranch house or bungalow, living life on one floor has plenty of positives. Here are some of the advantages:

  • Maintenance is a piece of (one-layer) cake. One-story homes are easier to maintain because everything's on the same level, points out Nathan Garrett, owner of Garretts Realty in Louisville, KY. On a daily basis, that means no schlepping a vacuum cleaner or loads of laundry up two flights of stairs. From an exterior point of view, everything from power-washing to window washing to painting stays easy and on the ground no scaffolding necessary.
  • Single-story homes are simpler to design. Thinking about building your dream house? One-story homes are simplest to design and thus less expensive to design, explains Rachel Preston Prinz, founding director of Archinia and Architecture for Everybody in Santa Fe, NM. They're also easier than two-story houses to structurally engineer and can be built with prefab components, if that's your jam.
  • They're safer to navigate. Have toddlers or an elderly parent living with you who might not be able to safely handle stairs? A one-story home means fewer risks of falls and accidents. It also means that once you get old, you can safely age in place.
  • They're easier to evacuate. In case of a fire, you'll be able to open any ground-floor window and crawl out to safety. (Just don't plant rose bushes directly under your planned escape routes.) Live in an earthquake zone? One-story (wood-framed) houses are the safest structures to be in during a quake.

Now for the potential drawbacks of single-story homes:

  • Building and adding on can be costly. If you're building a home from the ground up, a larger footprint requires more land, says Prinz. A one-story house also requires more materials such as for the foundation, roofing, and windows. And since plumbing and HVAC runs will need to be longer, thus requiring more power, you'll need bigger, pricier systems.
  • There's less privacy. Not everybody likes the letter carrier passing right by their bedroom window to drop off packages. While it's true that not every single-story house means you're all that exposed, second stories tend to be more secluded.

Two-story homes: Pros and cons

Whether you fancy a Cape Codsaltbox, or romantic Victorian, there's a sense of elegance that's inherent in multistory houses. Can you imagine the White House as one story? Certainly not Buckingham Palace. Aesthetics aside, here are the other perks you get with a two-level house.

  • Extra privacy: A second floor makes for an easier separation of public and private spaces, points out Prinz. If youv'e ever had guests over and sent your kids upstairs to watch a movie or your in-laws are crashing in the guest room downstairs and you need to get away in your master suite well, you know what we mean.
  • Lower risk of burglary: You have a significantly lower risk of a break-in if you accidentally leave a window open on the second floor [rather than one on the first], says Shayan Jalali, a sales associate for Keller Williams in Boston. A thief is unlikely to shimmy up your drain pipe just to check out your goods, and far less likely to shimmy down it with your flat-screen TV.
  • More design options: In two-story homes, its fun to play with the massing and scale of spaces, says Prinz, much more so than with just one level.
  • Potential views: If you live in a picturesque area, this advantage speaks for itself. Who doesn't love a good balcony or second-floor porch?

That said, two-story homes aren't perfect. Here are the downsides.

  • Greater risk of accidents: Let's talk about those stairs for a moment. They present a potential danger for young children and can be cumbersome for anyone with mobility issues, says Jalali. You'll need to deploy baby-proof gates or figure out a way to make your staircase accessible to any loved ones whose movement is limited. That isn't cheap. Most stairs are difficult to adapt for disabilities, says Prinz. Making a second floor accessible can cost upward of $20,000 for a lift.
  • Costlier heating and cooling: Heat rises; cold air drops. As a result, your upstairs will run hot, your downstairs cold, and you'll have to adjust your heating and AC accordingly. In fact, some experts say that a two-story home may have double the heating and cooling costs of a single-story home of the same square footage.
  • Potential for higher noise level: If not designed well, a multilevel home can have you covering your ears. If your bedroom opens directly onto a great room balcony or the floor isn't properly designed for acoustics, you'll hear people walking and talking above you, cautions Prinz.

Does Your House Have Foundation Problems? Ask Yourself These 5 Questions

by The Cope Real Estate Team

Does your house have foundation problems? Whether you're a homeowner or just sizing up a home to buy, a faulty foundation can be dangerous—and expensive.

Fortunately, though, that's not always the case.

"Most problems can be fixed, says Frank Lesh, executive director of the American Society of Home Inspectors. "Even a bad crack doesn't mean you have to tear down the house."

1. Did a crack appear all of a sudden?

Most houses do some amount of settling over time, but large, sudden changes are not usually a good thing.

"Some cracks are normal, but if big ones suddenly appear, that's a red flag," says Lesh. Yikes!

2. What does the crack look like?

The type of crack can also tell you if it's a problem or not. Hairline cracks in the mortar between concrete blocks are probably not worth calling a structural engineer for. Cracks in the mortar joints that look like stairs are a cause for concern, especially if the cracks are wider than a quarter-inch or if the wall is bulging. Horizontal or jagged 45-degree cracks are the most serious and usually indicate you will need professional help (and, potentially, a new foundation).

3. Are there any cracks that won't go away?

"It is almost inevitable that small cracks will appear over time even with a completely solid foundation," says Chris Black, president of Blackline Renovations in Dallas. "As seasons change and the ground around a foundation becomes more or less wet, most hairline cracks will close right back up."

If a crack expands beyond an eighth of an inch and doesn't close itself up (or even gets bigger), that's an indication of a more serious foundation issue.

4. Do the doors and windows have trouble closing?

A single door or window that's on the fritz isn't necessarily a problem, especially in humid areas where wood expands. But if the doors and windows on one whole side of your house suddenly won't close all the way, well, that's a bad sign. Look for cracks in the wall around doors and window frames—that's another indicator that something has suddenly shifted.

5. Do you see any cracked tiles?

There are lots of reasons that floor tiles can crack, but if you're seeing more than just a single broken tile, or a crack appears along the floor one day, that could mean that your floor is suddenly not level any more.

Common causes of foundation problems

OK, so you've got some cracks you're not happy about. Perhaps you're feeling the urge to throw open your window and scream, "Why has this happened to me?" Well, here are some reasons your foundation might be less than perfect.

  • Differential movement: "Differential movement is caused by widely varying moisture levels around or underneath your foundation," explains Black. When you have wet patches and dry patches of soil, wetter areas expand and push upward while dry areas sink, causing upheavals. The most common culprit is improper drainage around your house. Either your gutters aren't dumping water far enough away from the foundation, or the ground isn't sloped for "positive drainage" (water going away from the house, instead of toward it).
  • Flooding: Flooding—whether from a burst pipe, sewer leak, melted snow, or just too much rainfall—can cause wet soil to push up against the foundation, creating cracks.
  • Improperly prepared soil: If the soil beneath your slab foundation wasn't prepared correctly, as the weight of the house compacts it, parts of the foundation can settle and crack. This is especially a problem if there are several types of soil that compact differently, creating an uneven surface.
  • Trees too close to the house: What started out as a small tree a reasonable distance from your home can, over time, grow into a large tree way too close to your home. "Trees can cause a tremendous amount of damage by draining water from the soil under a foundation," Black says. "Large roots can also push upward on the structure."
  • Frost heave. Freezing and thawing causes water molecules to grow and shrink, making the soil beneath your home push up and contract back, eventually causing cracks.
  • Changes to nearby ground: If you live in a city, construction near your home can jar your foundation. Someone digging out a new foundation next door can cause yours to shift if it's not properly braced. In the suburbs, heavy machinery (like a cement truck) on a driveway alongside the home can cause the ground beneath to compact, shifting the foundation as well.

What it will cost to fix foundation problems

The amount of money you'll have to pay to fix your faulty foundation will, of course, depend on the cause and severity of the problem. Your first move is to find a structural engineer or contractor with foundation experience to give you a diagnosis.

"There have been so many different advances in foundation repair, it is critical to find an expert and certified contractor who can talk through the pros and cons of different techniques," says Black. "Speak to at least a few different foundation contractors, and don't just rely on the lowest bid."

The average price range is $1,900 to $6,000, according to HomeAdvisor, though it's extremely variable, depending on your problem, type of foundation, and where you live.

The fix could be as simple as a contractor injecting epoxy into your wall to strengthen it, a procedure Lesh estimates costs around $50 a square foot. Or, you could be looking at a much more extensive repair to shore up the issue.

Whatever your situation, it's worth paying a reputable, certified contractor to do the repair. A foundation problem is a safety issue, and it's not going to get better with time. As Lesh says, "If you have a bad foundation, you’re going to have a bad house."

Open Floor Plan Homes: You Really Want One? The Pros and Cons

by The Cope Real Estate Team

Open floor plan homes—those with no walls separating the kitchen, dining and/or living area—are all the rage today. According to the National Association of Home Builders, 84% of new single-family homes have fully or partially open layouts.

But whether you're thinking of buying an open floor plan home or renovating your way to one by knocking down a wall, you should know both the pros and cons of this setup (because it's not all good news).

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A history of open floor plans

Early American homes were "open" by necessity: one or two rooms built around a central hearth. During the Victorian era, however, it became popular for homeowners who could afford it to build many smaller, specialized rooms, from parlors to maid's quarters. Yet as society changed, so did our floor plans. As full-time help became less common and home life became more casual, there was no need for cooks to hide out in the kitchen.

Benefits of open floor plans

Open floor plans are popular for good reason.

  • Maximizes square footageOpen floor plan homes feel bigger, since the square footage isn't cut up into small, cramped quarters. Plus, "With a living room and dining room, you're allocating 300 square feet of space to rooms that are only used a few times a year," explains Kallos. "An open floor plan home will feel bigger because you don't have all this unused space."
  • Better natural light. Removing walls lets the light that comes in through your windows spread throughout the home, eliminating dark interior rooms that have to have artificial lights on even during the day.
  • Social cohesiveness. Open floor plans make socializing easier, even when people are doing different things—say, Dad's cooking dinner while the kids are playing in the living room while Mom pays bills at the dining room table. Entertaining guests is easier, too; you can catch up with guests in the dining area while preparing dessert.
  • Flexibility. "Open floor plans create a usable space that's flexible, based on your needs," says real estate agent Jimmy Branham of the Keyes Company in Fort Lauderdale, FL. Want a giant TV to be the center of your living space for sports games? No problem. Long for a farmhouse table for dinner parties? A dance floor for all your friends? Go for it. However homeowners choose to define their space, it works without making major architectural changes.

Downsides of open floor plans

Open floor plans may be popular, but they're certainly not for everyone. Here are a few of their challenges.

  • Cooking heat and smells travel everywhere. Don't want your couch to smell like fried fish? Unless you've got a heavy-duty vent hood, you might just have to go to the chip shop with an open floor plan. There's no way to keep the smoke, food smells, and oven heat contained.
  • Less formal living. Some people want to be able to sauté while chatting with guests sipping wine at the kitchen island. Other people want to be able to get some cooking done without anybody sticking a finger in the sauce. If your hosting style is more formal—or if you employ professional cooking help, and you don't want guests to bother them—an enclosed kitchen and more formal living/dining space might be better for your needs.
  • Less privacy. Sometimes, hanging out with your whole family is a downside. Parents like to be able to escape from kids for a little while. Or maybe you just want to read a book while someone else is cheering for their basketball team.
  • It's noisier. Kid noise, cooking noise, TV noise, the dishwasher running, someone else's music on the stereo: There's no hiding from everybody's noise in an open floor plan, and a lack of walls makes the space echo more and is less sound-absorbent.
  • You can't hide the mess. It's nice to have guests come over and only have to clean one room. In a home with a dedicated office, a separate playroom, and closed kitchen, you can just shut the doors and deal with the mess later. With an open floor plan, everything is visible, including your clutter.
  • It could date your home. Open floor plan living is a trend that's been building for years. It shows no sign of slowing, but everything goes in and out of fashion. With a completely, radically, loftlike open floor plan, you might be setting yourself up to look "so late 20-teens" in 10 or 20 years' time.

Ask These 4 Questions During the Home Inspection

by The Cope Real Estate Team

Buyer Tips: questions to Ask Your Home Inspector

When you make an offer on a home, your real estate agent will strongly recommend requesting a home inspection. About four in five home buyers decide to attend the home inspection and get the experience personally. If you are somewhat unfamiliar with the process, it may be a good idea to learn a little more about what goes on during this important part of buying a home.

Here are four questions you can ask during the home inspection to get a better understanding of what the inspection covers and how to interpret the results.

1. Is There Anything Not Covered in the Home Inspection?

A home inspection is quite necessary to ascertain the condition of a home you want to buy. Inspectors are trained and certified to look at many different aspects of the home and determine damage or the likelihood that you will need to replace something soon. However, the home inspection does not test for everything.

A home inspector looks at the structure and the home’s systems and equipment for their current condition. This may not include testing for the presence of toxic contaminants, such as mold, lead or radon. It may also not involve the inspection of other structures or systems on the property, e.g. a shed or swimming pool.

2. What Should I Be Looking For?

The best thing you can do is follow the inspector through the home during the inspection. This allows you to see what the inspector is looking at. You will have a better memory of problems that come up if you recall seeing them yourself. As a buyer, your eye may be distracted by cosmetic issues that are unrelated to the goals of the home inspection. Ask the inspector to show you the kinds of things you should focus on during the inspection, so you can stay on topic and not miss out on the important parts of the study.

3. Can You Point Out Problems You Identify?

Preparing a report for a home inspection takes time. The inspection itself calls for a few hours of time, and then the inspector must document the nature and extent of any concerns in a report that is given to both the seller and the prospective buyer.

Inquire if the inspector is willing to share issues as they are observed, so that you can see the problem at the same time. This will help you to make a mental list and visual image and estimated costs of future repairs. Your inspector may be happy to discuss the details of necessary fixes, or they may not. After the inspection, ask about referrals to repair services if needed.

4. How Do I Decide Which Items Are Most Important?

Once you get the home inspection report, you have to determine which repairs are important enough to you to bring up with the seller. Some issues may be so simple and inexpensive that you do not want to hold up the home buying process to get them resolved. Others could be more complicated, requiring negotiation with the seller. If it is not easy to make a distinction in repairs, raise the topic with the inspector and get their opinion about the bigger or more expensive problems. You do not have to follow the recommendation, but it may help you make a practical decision.

Buying a home is a big investment, making the home inspection so relevant for your future. With these four questions, you can follow through the inspection and look for the right things in each part of the property. At the end, you will know what to do with the report and have a better time prioritizing any necessary repairs.

The Costs of Homeownership & How to Save on Your Monthly Bills

When renters begin considering the possibility of buying a home, they often think about doing so as a way to get something back for the money they are spending each month on rent. While this idea is an important one, these prospective buyers may not be considering the total cost of home ownership.

What are the Additional Costs of Home Ownership? 

Along with the amount of the mortgage and interest payments, homeowners must also cover several other costs associated with owning a home. These include both monthly and annual costs, such as:

  • insurance premiums, including homeowners insurance, flood insurance (if applicable), and any specific coverage needed, such as liability coverage for a home-based business
  • additional costs related to the financing, such as private mortgage insurance premiums
  • monthly utility costs, including heat, air conditioning, electricity, water, and sewer service
  • routine maintenance costs to maintain systems in the home 
  • the costs of any repairs or renovations needed 
  • property taxes, including county and city taxes 
  • the costs for any special assessments or fees, such as homeowners' association fees, utility assessments, etc. 
  • the cost to maintain or replace necessary appliances, such as cooking and food storage appliances, laundry appliances, etc. 

Renters who decide to purchase a home without considering these additional costs often find themselves blindsided by emergency repair bills that would have previously been their landlord's responsibility. 

How can Prospective Buyers Avoid Purchasing an Unaffordable Home?

Home buyers who want to reduce or control many of the additional costs of owning have an excellent opportunity to do so during the home buying process. In most cases, many of these costs associated with a particular home can be researched prior to making an offer on the home, giving the prospective buyers the information they need to decide if the home will be affordable for them in their expected financial situation.

In order to find out about these costs for a particular home, prospective buyers should start by requesting seller disclosure documents, average utility costs, and recent tax and insurance information. 

Tips for an Affordable Experience

Making the recurring costs of homeownership more affordable begins with avoiding or eliminating those that are unnecessary. Buyers who want to enjoy the lowest possible recurring home ownership costs can do so by: 

  • eliminating any homes from consideration that require expensive flood insurance or have some type of unique feature or location that results in a higher than average homeowners insurance premium
  • looking for homes in areas where the tax rates are more reasonable 
  • avoiding homes covered by a homeowners' association 
  • saving up to put at least twenty percent down on the home purchase to avoid the need for private mortgage insurance premiums
  • choosing a home that is newer or has been well-maintained to avoid as many potential repair and maintenance costs as possible
  • making sure they have enough savings to cover unexpected home repairs or appliance failures
  • searching out homes that offer updated appliances 
  • searching for homes that feature high efficiency heating and air conditioning systems and optimal insulation values for more economical utility costs after the purchase

Prospective buyers who want to enjoy an affordable living experience after their purchase should always begin by discussing their situation with their real estate professional. Their agent can use their knowledge of the market area to help them streamline their search and more easily locate the best possible homes for them to consider. In addition, the agent will be able to help them locate specific information about each home so that they can feel comfortable that they have made the best possible choice. 

Fed Will Proceed With Caution on Future Rate Increases

by The Cope Real Estate Team

[1]Boston Fed [2] President Eric Rosengren stated in an address [3] at the Greater Boston Chamber of Commerce that the Fed’s recent raising of the federal funds target rate was a milestone, but at the same time, he indicated that future rate increases were likely to be gradual and that it will be important to carefully manage risks to the economy. Rosengren noted that he hopes further normalization is appropriate, but at the same time the “gradual” approach to raising the rates reflects the current economic landscape. Inflation remains well below the Fed’s 2 percent target rate, stock markets have been weak in other parts of the world, oil and commodity prices have been weak, and GDP growth for the U.S. in the fourth quarter has been slow. On the positive side, Rosengren noted the monthly average of 284,000 jobs added in the last quarter of 2015, including the 292,000 added in December. Further rate increases will be determined by incoming economic data and how policymakers view that data, he said. “While monetary policy should not overreact to short­term, temporary fluctuations in financial markets, policy makers should take seriously the potential downside risks to their economic forecasts,” Rosengren said. Rosengren called the economic recovery “painfully slow” since the recession while noting that improvements to the economy in the last year provided the conditions necessary for the Fed to remove some of the “extraordinary monetary policy accommodation” put in place as a necessary, appropriate, and effective response to the crisis and recession. The Fed’s raising of the rates in December was the first short­term rate increase since the Great Recession. Rates remain well below their pre­crisis levels, however; Rosengren stated that the Federal Open Market Committee “expects that economic conditions will evolve in a manner that will warrant only gradual increases in the federal funds rate.” Click here to read the full text of Rosengren’s speech [3] . Article printed from DSNews: http://www.dsnews.com URL to article: http://www.dsnews.com/news/01­14­2016/fed­will­proceed­withcaution­on­future­rate­increases URLs in this post: [1] Image: http://www.dsnews.com/wp­content/uploads/2015/02/ups­anddowns­graph1­300x198.jpg [2] Boston Fed: http://www.bostonfed.org/ [3] stated in an address: http://www.bostonfed.org/news/speeches/rosengren/2016/011316/011316text. pdf

Why Did Nearly One-Third of House Democrats Vote to Oppose the CFPB?

by The Cope Real Estate Team

[1]When it comes to the Consumer Financial Protection Bureau (CFPB [2]), Democratic and Republican lawmakers are generally sharply divided with Democrats vigorously defending the Bureau or any action it takes.

So why did 64 Democrats—about a third of the 188 Democrats in the U.S. House of Representatives—vote in favor of H.R. 3192 [3], the Homebuyers Assistance Act, on Wednesday to implement a formal grace period until February 1, 2016, for compliance with the CFPB's TILA-RESPA Integrated Disclosure (TRID) rule? Even the White House issued a statement saying that the President was advised to veto the bill if it reaches his desk.

Perhaps the amount of consternation and even "angst," as CFPB Director Richard Cordray put it in his testimony before Congress on September 29 [4], expressed by those who work in the mortgage industry over whether they could be fully compliant with TRID in time for the October 3 effective date generated some sympathy among Democratic lawmakers and motivated them to vote in favor of the formal grace period. That was the case with Rep. Brad Sherman [5] (D-California), co-sponsor of H.R. 3192 along with Rep. French Hill (R-Arkansas).

"These new forms and regulations are complicated," Sherman said. "Smaller lenders and title companies are complying in good faith with a 1,888 page regulation that is only now being tested in real life home closings. The Hill-Sherman bill tells these smaller lenders, title and escrow companies to implement the new forms immediately. However, if they act in good faith but make unintentional mistakes, they will not be subject to retribution for those mistakes made prior to February 1, 2016."

The Obama Administration, which created the CFPB out of the Dodd-Frank Act four years ago, has been fiercely protective of the Bureau and has fought repeated efforts by Republicans to reform the CFPB. The White House issued a statement saying they believe that it was unnecessary to announce a formal grace period for TRID.

"The CFPB has already clearly stated that initial examinations will evaluate good faith efforts by lenders," the White House wrote. "The Administration strongly opposes H.R. 3192, as it would unnecessarily delay implementation of important consumer protections designed to eradicate opaque lending practices that contribute to risky mortgages, hurt homeowners by removing the private right of action for violations, and undercut the Nation’s financial stability."

Both Sherman and Rep. John Garamendi (D-California), who voted in favor of the bill, noted that smaller lenders generally do not have the resources in place to quickly comply with the new regulations. A spokesperson for Garamendi told DS News that the Congressman voted in favor of H.R. 3192 "because the bill simply codifies the CFPB’s announced policy regarding enforcement. Secondly, while bigger servicers may have the capability to make such an immediate transition, smaller servicers may not have the resources. He believed the bill provides an adequate grace period, and Congressman Garamendi had them in mind when making his decision."

"This bill says there is no retribution for good faith efforts. This is especially important for smaller companies that do not have the resources to quickly comply with new government regulations."

Sherman questioned Cordray on the issue of a possible grace period, or "hold harmless" period, for TRID compliance during the director's testimony before Congress in late September.  In that hearing, Sherman Sherman likened the TRID rule to a building a new ship, saying that no matter how much time is spent at the dock, the builder is not finished building the ship until it's taken on a" shakedown cruise," or a test run. The shakedown cruise began on October 3, however, since the new regulations and integrated forms could not be applied prior to the TRID effective date.

Cordray has said on multiple occasions that the CFPB would be lenient with those making a good faith effort to comply with TRID, though he steadfastly refused to say for how long after the rule took effect the grace period would last. In that Congressional hearing on September 29, Sherman asked the director if he would be willing to announce a three-month hold harmless period for those making a good faith effort to comply; Cordray responded that he was "pushing hard" to make announcement along the lines of what Sherman was asking for before October 3.

When no such announcement came, Congress took the matter into its own hands, fueled by House Majority Leader Kevin McCarthy (R-California) and quickly voted to pass H.R. 3192. The bill passed by a vote of 303 to 121 with bipartisan support—239 Republicans and 64 Democrats voted in favor. All 121 who voted nay were Democrats. Ten representatives (seven Republicans, three Democrats) did not vote; every Republican who voted chose to vote in favor of the bill's passage.

Foreclosure Inventory Drops to Lowest Monthly Total in Eight Years

by Posted By Brian Honea On August 21, 2015 @ 1:01 am

Foreclosure inventory dropped to its lowest level since 2007 while the share of non-current residential loans (30 days or more delinquent but not in foreclosure) also substantially declined and is near a post-crisis low, according to Black Knight Financial Services [2]First Look at Mortgage Data for July 2015 [3] released Friday.

The number of properties in foreclosure pre-sale inventory dropped by 24 percent year-over-year in July down to 711,000 properties, representing about 1.4 percent of all residential mortgages nationwide. It was the lowest total of properties in foreclosure inventory for one month since 2007, according to Black Knight.

Foreclosure inventory was not the only metric that experienced a large decline in July, however. The delinquency rate (percentage of properties 30 days or more overdue but not in foreclosure) dropped by 16 percent year-over-year down to 4.71 percent, nearly reaching its lowest point since the crisis. That share of 4.71 delinquent properties represents about 2.39 million loans nationwide.

BK Graph 1[4]Among states, Colorado's non-current residential mortgage loan share of 2.96 percent was the lowest in that state in 10 years. It was also the second-lowest rate in the nation in July (North Dakota's non-current rate was 2.12 percent). The state with the largest 16-month improvement in non-current share in July was Florida with 21.6 percent, down to 7.69 percent; that share is approximately one-third of California's non-current residential mortgage loan share peak of 25.48 percent reached in January 2010. California joined the top five in six-month improvement for non-current loan share with a decline of 16.4 percent, down to 3.52 percent. California's peak was 15.69 percent, reached in February 2010.

BK Graph 2[5]The number of foreclosure starts during July also declined nationwide both over the month and over the year. July's total of 75,400 foreclosure starts represented a decline of 4.5 percent from June and nearly 17 percent from July 2014, Black Knight reported.

BK Graph 3[6]The monthly prepayment rate, which is historically a good indicator of refinance activity, was reported at 1.26 percent in July – a decline of 9.4 percent from June but was up from 20.4 percent from July 2014.

For its "First Look" at mortgage data, Black Knight used statistics from its loan-level database representing about two-thirds of the overall mortgage market.

Eligible borrowers and their heirs will be able to claim uncashed payments made pursuant to the 2013 Independent Foreclosure Review Payment Agreement through their respective states' escheatment process, according to announcement from the Office of the Comptroller of the Currency (OCC) on Wednesday.

The OCC announced that any uncashed payments made pursuant to the IFR Payment Agreement will be escheated at the end of 2015 in order to allow eligible borrowers and their heirs to claim the funds.

Also on Wednesday, the OCC announced that it has terminated foreclosure-related consent orders against three national mortgage servicers that have met the consent order requirements and imposed business restrictions on six banks that have not met the requirements.

More than $2.7 billion has been distributed to more than 3.2 million eligible borrowers from OCC-supervised institutions as a result of the IFR Payment Agreement, representing about 90 percent of the amount available for distribution, according to the OCC. The agency estimates that about $280 million from OCC-supervised institutions will go unclaimed by the end of this year after all efforts to find remaining eligible borrowers have been exhausted; the escheatment of funds from uncased checks will give eligible borrowers and their heirs an additional opportunity to claim the funds.

The OCC determined that Bank of America, Citibank, and PNC bank have complied with the orders the agency issued in 2011 and the amendments it issued in 2013 and therefore the consent orders against them have been terminated.

The six institutions that the OCC determined have not met all the requirements of the IFR were (alphabetically) Everbank, HSBC Bank USA, JPMorgan Chase Bank, Santander Bank, U.S. Bank, and Wells Fargo, and therefore the OCC issued orders to restrict their business activities.

The restrictions include limitations on the acquisition of residential MSR portfolios, new contracts to perform residential mortgage servicing for other parties, the outsourcing or sub-servicing of new residential mortgage servicing activities to other parties, off-shoring new residential mortgage servicing activities, and new appointments of senior officers responsible for residential mortgage servicing. OCC said the restrictions will vary based on the individual circumstances of each bank, and the agency will continue to monitor the corrective actions for these institutions.

A spokesman for the OCC told DS News that the restrictions are meant to focus servicer action on meeting the remaining requirements in their respective consent orders, and that the restrictions will not impede consumers' access to mortgage loans.

The Independent Foreclosure Review concluded in January 2013 with 10 mortgage servicers reaching an agreement with the Fed and the OCC to pay a combined total of $8.5 billion to more than 3.8 million homeowners whose homes were in foreclosure in 2009 and 2010. The sum included $3.3 billion to be paid directly to borrowers. The claims allege that the servicers mishandled loan paperwork and robo-signed documents related to the foreclosures. The settlement totals were later increased to 15 servicers and a total of $10 billion in payments, according to the Fed.

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The Cope Real Estate Team
Keller Williams Realty
5601 Truxtun Ave #150
Bakersfield CA 93309
661-871-COPE(2673)
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Jared Cope DRE# 01506193 | The Cope Real Estate Team