Written by Federal Title | 15 April 2010

A daily dose of headlines for real estate agents, mortgage lenders and consumers.

Shops at Georgetown Park headed to auction Washington Post: Property is slated to go up for bid May 5, in what would be one of the region's largest commercial real estate foreclosures in the economic downturn.	10 foreclosures for every home saved CNN Money: The Obama administration's mortgage-modification program is not keeping pace with the deluge of foreclosures hitting the market, a government watchdog found.
Economy strengthening but structural defects remain Market Watch: Despite the growth in gross domestic product, the increase in sales and the rebound in manufacturing output, the economy still suffers from severe structural defects.	U.S. Foreclosure Program Helps Few, Watchdog Says Bloomberg: As of February, 168,708 homeowners had received five-year loan modifications, out of 6 million borrowers 60 days late or more on mortgage payments, the panel said.
Regional banks fall after downgrade Business Week: Nearly all banks have faced growing loan losses in recent years as the recession took hold and more people struggled to repay debt.	Mortgage pitfalls to avoid as a buyer today The Apple, Peeled: Brokers, buyers, lawyers and lenders all need to approach a purchase with more scrutiny than in the past. It’s a buyer’s market: Make the most of it!

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Headlines compiled by Strategic Research.

Written by Federal Title | 14 April 2010

A daily dose of headlines for real estate agents, mortgage lenders and consumers.

Florida, Virginia homeowners win Chinese drywall suit Washington Post: The drywall has been linked to the corrosion of wiring, air conditioning units, computers, doorknobs and jewelry, along with possible health effects.	Montgomery County to update zoning codes DC Mud: County is reworking its zoning codes, last updated in 1977, to include tools for today's development world, like sustainable building and metro-oriented development.
Mortgage investors see headway on 2nd liens Reuters: More than half of private mortgage bonds, which at the height of the housing boom exceeded government-related funding, are encumbered by seconds, according to Amherst Securities.	Shiller: Why the housing optimism? The Atlantic: Like stocks, housing prices are based on expectations. But also like stocks, fundamentals must eventually catch up to forecasts. Those indicators remain mixed at best.
Homeowners making sacrifices in tough economy Forbes: As home sales and prices rise, consumer optimism usually follows suit, leading homeowners to feel wealthier and make them more comfortable spending.	Reading housing data 101 The Apple, Peeled: The key lies in recognizing that there is no direct linearity to depend on. Yes, patterns emerge from this data and they help inform our analysis of the times in which we live.

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Headlines compiled by Strategic Research.

Written by Federal Title | 13 April 2010

A daily dose of headlines for real estate agents, mortgage lenders and consumers.

Why are there no houses for sale in DC? The Atlantic: This should be a golden time for buyers with decent credit, stable incomes and modest requirement for neighborhood safety. But there's almost no inventory.	Economy shifts attitudes about homeownership, money Washington Post: As many people who lived through the privation of the 1930s developed lifelong frugality, we, too, may emerge from the recession with our beliefs about real estate and personal finance transformed.
Q&A: Post-Fed mortgage-backed securities Pimco: Because we expect investors will continue to buy on the dips, we don’t believe the Fed’s retreat will have a substantial impact on mortgage rates charged to homebuyers.	How Texas dodged the housing bubble The Economist: Why didn't the housing boom ever take hold in Texas even though it seems to have all the usual sunbelt characteristics that drove the bubble in places like Florida?
Should we be more optimistic about housing? Wall Street Journal: Recent polls show that economic forecasters are largely bullish about the housing market for the next year or two. But one wonders about the basis for such a positive forecast.	60 L Street NE: Fashionably late DC Mud: The two-phase project could ultimately bring 682,000 s.f. of residential and retail space - more than 700 units of housing - to the NoMa neighborhood.

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Headlines compiled by Strategic Research.

Written by Federal Title | 09 April 2010

A daily dose of headlines for real estate agents, mortgage lenders and consumers.

Bernanke: Joblessness, foreclosures pose hurdles Business Week: Joblessness, home foreclosures and weak lending to small businesses pose challenges to the economy as it recovers from the worst recession since the 1930s.	Rising mortgage rates not Fed's fault CNBC:Remember, mortgage rates respond to bond returns, and as the economy improves and the stock market improves, bonds have to pay higher returns to hold onto investors.
Zillow: Fewer sellers cut home prices in March Reuters: The percentage of U.S. home sellers cutting their asking price declined again in March, and home owners made smaller reductions in prices, according to a report by real estate website.	Overtaxed homeowners start to fight back CNBC: Now that the housing bubble has burst, up to 60 percent of the nation's taxable property may be over-assessed, meaning owners are paying thousands of dollars more in taxes.
Housing won't heal until renters come back Wall Street Journal: The U.S. lost 1.2 million households from 2005 to 2008 even as the country’s population increased by 3.4 million, underscoring the huge inventory glut that looms.	Future of 14th and R still in limbo DC Mud:The project will sit directly across the street from a planned seven-story residential development, each hugging their respective corners on 14th and R Streets NW.

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Headlines compiled by Strategic Research.

Written by Federal Title | 09 April 2010

A daily dose of headlines for real estate agents, mortgage lenders and consumers.

Without the Fed, mortgage rates bounce around Wall Street Journal: Analysts say even if rates don’t rise significantly in the coming weeks, mortgage rates will likely become more volatile without the Fed.	Courthouse condos someday, somehow DC Mud: The on-again, off-again residential project at 2000 Wilson Boulevard, no, make that 2001 Clarendon Boulevard, is on again-ish.
Rates on 30-year home loans rise Forbes: Rates for 30-year home loans surged last week, rising to the highest level in eight months due to the improving economy and the end of a government push to keep rates low.	Dangers of homes as investments Business Week: As on other assets, the return on a home depends on the details, especially local demographics, how much it costs you to maintain it, and what your renting alternatives are.
REO sales push home prices down Housing Wire: After nine months of quarterly gains, US home prices dipped 3.9% from January to March as real-estate owned (REO) property takes more of the market.	Foreclosures hit the rich and famous Wall Street Journal: Economists say the super-wealthy are among the last to lose their homes in a mortgage crisis because they usually have means for staving off foreclosure.

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Headlines compiled by Strategic Research.

Written by Federal Title | 08 April 2010

A daily dose of headlines for real estate agents, mortgage lenders and consumers.

Homebuilders may lag behind stock market Bloomberg: U.S. homebuilders will underperform the stock market in the next few months as demand slows after the expiration of a key tax incentive.	What are you worth to your bank? Washington Post: The question at hand was, "How much is a customer worth to a commercial bank?" This is what we came up with:
The fallacy of eternal home price appreciation The Atlantic: Harvard economist Edward Glaeser explains why real estate is a particularly poor investment, arguing that it's pretty plausible that your house's value won't rise.	Is the price right for housing recovery? Housing Wire: After nearly three years of recession, Americans are tired of not consuming. And so, while unemployment might still be hovering around 10%, consumers are heading back to the mall.
Fastest growing retailers Forbes: Few industries have been hurt as badly by the recession as retail, the front lines of the battlefield where businesses try to separate consumers from their money.	Foreclosures are rising Forbes: Foreclosure numbers have been down recently because of modification efforts, but as more loans don't qualify for modifications, the foreclosure numbers rise.

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Headlines compiled by Strategic Research.

Written by Guest | 07 April 2010

Without a doubt, industry guidelines have tightened, and lending restrictions have increased for home financing. If you are planning to purchase a home, there a few things to think about and certain documentation you should be prepared to provide.

1. If your credit score is below 720, your interest rate could be .25% higher than a homebuyer with a score of 720. Factors effecting your credit score could be the following:

    a) revolving debt balance vs. credit limit
    b) late payments
    c) excessive credit inquiries

Written by Matt Bales | 07 April 2010

Although many REO purchase and sale contracts provided by REO lenders designate a closing and title company, many REO buyers are not aware that the REO lender cannot require, as a condition of sale, that the buyer purchase title insurance from a particular title company.

The buyer of REO property has the absolute right to choose the closing and title company and pay for the buyer’s own title policy. Section 9 of RESPA prohibits a seller from requiring the home buyer to use a particular title insurance company, either directly or indirectly, as a condition of sale.

Written by Federal Title | 07 April 2010

A daily dose of headlines for real estate agents, mortgage lenders and consumers.

On home sales: Curb your enthusiasm Wall Street Journal: While there might be strong data in future weeks, industry experts have long said that softness could follow once the incentive - essentially free money - to buy is taken away.	DC streetcar project may get caught on overhead wires Washington Post: Before city planners can realize their vision of a $1.5 billion transportation system, they must battle some guardians of the Federal City.
Doomed historic H Street properties hang on DC Mud: A cluster of fifteen historic townhouses on Capitol Hill once set for demolition, then seemingly spared by the economy, has had its death warrant extended.	How many will the new mortgage mod programs reach? Wall Street Journal: The programs are voluntary and they require borrowers to document their incomes and qualify for a modification or refinance.
America's worst selling housing markets Forbes: Home prices have dropped, and inventory and sale prices are up in these big cities.	World's unusual treehouses Forbes: People think ‘treehouse' and imagine creaky plywood forts where kids sneak away to have their first kiss, but it's moved so far beyond that.

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Headlines compiled by Strategic Research.

Written by Catherine Schmitt | 06 April 2010

A few things that happen after closing a refinance of a property in the District of Columbia.

First, if the property refinanced was your principal residence, a period of three business days from the date of signing the documents – often called the three-day right of rescission – must pass before the loan process can be completed.

The rescission period is the time in which a consumer can re-examine the loan to make sure it is something the consumer truly wants to take out and can cancel the loan prior to midnight of the third day. (In certain very specific circumstances, this three day period can be waived for principal residences.)  

If the refinanced property was an investment property, no rescission period is required.

The second thing that happens is your loan is funded by your lender. (The lender usually waits to fund the loan until after any required rescission period has passed.)  

If your refinance was a “cash-out” transaction, in other words, you are to receive money, then the title company sends the money to you either in check form or a wire transfer, whichever you requested at settlement.

The third thing that happens is your fully signed and notarized loan documents are sent to the lender and any document to be recorded is sent to the Recorder of Deeds office, usually via a recording service provider.

Lastly, once the lender lien document has been recorded at the Recorder of Deeds office, then the public records will reflect a new loan or lien against your property. The recorded document is sent directly to the lender.

Written by Federal Title | 06 April 2010

A daily dose of headlines for real estate agents, mortgage lenders and consumers.

Greenspan: Momentum building in U.S. economy Business Week: The former Fed chairman said the chances the economy will retrench after recovering from the worst recession since the 1930s have fallen in recent months.	Economy adds jobs at fasted pace in three years Forbes: Overall, the economy added 162,000 jobs for the month. About a third of the gains came from the census with much more to come: About 700,000 head-counters will be hired this spring.
Sharp rise in February home sales The New York Times: The wobbly housing market is showing a rare sign of strength: Pending home sales were up significantly in February.	Don't buy into a money pit Boston Globe: There’s more to consider when looking for a home than purchase price alone. Costs can add up quickly, overwhelming many first-time owners
Smartest home renovations are least visible Wall Street Journal: Stiffer home-appraisal rules mean fewer banks will lend extra to buy or remodel homes with features that are out of line with comparable properties nearby.	Bethesda mortgage broker charged with fraud Washington Post: A Bethesda mortgage broker has been indicted in federal court on charges that he was part of a scheme to defraud lenders, family members and others of more than $2.8 million.

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Headlines compiled by Strategic Research.

Written by Federal Title | 05 April 2010

A daily dose of headlines for real estate agents, mortgage lenders and consumers.

Mortgage rates on 30-year rise to 5.08% Bloomberg: U.S. mortgage rates climbed to the highest level in almost three months as the Federal Reserve ended a program that helped cut borrowing costs for homebuyers.	Fed: Sustainable U.S. recovery appears underway Reuters: A sustainable U.S. economic recovery appears to be underway, but growth is likely to be muted, warranting the Federal Reserve's ultra-low rate policy,
FDIC sells $491 in home loans Business Week: The agency said about 80 percent of the homes involved are located in Arizona, Florida and Georgia, which are among the states with the highest numbers of failed banks.	What the jobs report means for housing Wall Street Journal: Indeed, the surest way to stem foreclosures at this point is to reverse job losses, something the administration likely knows all too well.
Deadline looms to use federal foreclosure money Business Week: With a use-it-or-lose-it deadline just months away, communities have spent less than half of $4 billion available  to redevelop abandoned and foreclosed properties.	Study: Borrower's could stay 'underwater' for years Wall Street Journal: A new study by First American CoreLogic finds that it could take until late 2015 or early 2016 for the typical underwater borrower to have positive home equity,

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Headlines compiled by Strategic Research.

Written by Matt Bales | 02 April 2010

A common, but easily preventable, occurrence for many commercial property owners is having a mechanic's lien filed against their property when their tenant has not paid its contractor and/or their tenant's contractor has failed to pay one of its suppliers, subcontractors or laborers for improvements made to the property by the tenant.

The mechanics lien is a cloud on the property's title and can prevent the sale or refinancing of the property until the mechanic's lien is paid. Often a mechanic's lien for tenant improvements is discovered long after same has been filed in the public records, but by taking a few proactive measures landlord's can ensure that their properties will be protected from the burdens imposed by such mechanic's liens.

Florida Statutes §713.10 provides a landlord with absolute protection from mechanic's liens arising from tenant improvements when the landlord: (i) expressly provides in its lease that that there may be no liens against the landlord's interest in the property for tenant improvements; and (ii) records, in the clerk's office in the county where the property is located, the lease, or a memorandum of the lease, which contains the prohibition against liens attaching to the interests of the landlord.

The following is sample language which a landlord may include in its lease agreement to prohibit the creation of mechanic's liens for tenant improvements in accordance with Florida Statues §713.10 by recording the lease agreement or a memorandum thereof in the applicable county clerk's office:

In accordance with the applicable provisions of the Florida Mechanic's Lien Law and specifically Florida Statutes, Section 713.10, and notwithstanding anything to the contrary contained in this Lease, the interest of Landlord, whether real or personal, in and to the Premises, the Property, the Project or any part thereof shall not be subject to or chargeable with any liens for labor performed or material supplied in connection with any work or improvements performed or caused to be performed by Tenant or any of Tenant's Agents, and Tenant shall have no right, power or authority to create or allow to be created any such liens regardless of whether Landlord has approved or consented to such work or improvements.

All persons and entities contracting or otherwise dealing with Tenant relative to the Premises and the Project are hereby placed on notice of the provisions of this paragraph, and Tenant hereby agrees to notify such persons or entities in writing of the provisions hereof prior to the commencement of any such work or improvements.

Additionally, if the landlord owns commercial properties with multiple units such as office centers and shopping centers, and all of the leases entered into by the landlord on a particular parcel of land prohibit liability for liens for tenant improvements, Florida Statues §713.10(2) provides that the landlord may, in lieu of recording each lease or memorandum thereof, record a master notice in the public records of the county in which the parcel of land is located which contains the following:

• The name of the landlord.
• The legal description of the parcel of land to which the notice applies.
• The specific language contained in the various leases prohibiting such liability.
• A statement that all leases entered into for premises on the parcel of land contain the language identified in paragraph (iii).

Although Florida Statues §713.10 provides that the interest of the landlord shall not be subject to liens for improvements made by the lessee when the landlord complies with the provisions therein, commercial property owners can take several additional measures to protect their interests when tenant improvements are being made in their properties as, in some instances, mechanic's liens are filed notwithstanding full compliance with Florida Statues §713.10.

In such instances such mechanic's liens are not valid but require commercial property owners to commit resources and funds to remove the invalid clouds created by such improperly filed mechanic's liens.

First, every lease agreement should provide that the tenant shall notify any and all contractors making any tenant improvements of the provision or provisions in the lease agreement which prohibit liens against the landlord's interest in the property.

Ideally, the landlord's lease agreements should require the tenant to include language in all of its contracts with all contractors providing labor, services and materials for tenant improvements that the all such contractors acknowledge that they have been notified of the provisions in the lease agreement which prohibit liens against the landlord's interest in the property and that under no circumstance will they file any such liens against the landlord's interest in the property.

Contractors are less likely to file invalid mechanic's liens for tenant improvements against the landlord's interest in the property when they contractually agree not to do so and are made aware of the framework set forth in Florida Statues §713.10.

Furthermore, landlords should include in their lease agreements a provision that all contracts for labor, services and materials for tenant improvements are subject to the review and approval of the landlord. This provides the landlord with the opportunity to make sure that the requisite acknowledgment by the contractors regarding the provisions in the lease agreement which prohibit liens against the landlord's interest in the property is contained in the applicable construction contract.

In addition, landlords should require in their lease agreements that their tenants obtain lien waivers from the general contractor, every material supplier and every subcontractor who works on a project and labor waivers from any person who supplies labor to the project and provide copies of same to the landlord.

In the event the tenant can not timely provide the required lien waivers to the landlord, the landlord will have sufficient time to investigate the reasons therefore and take corrective actions regarding same in lieu of learning of any potential problems at a later point in time when a cloud on the title to the landlord's property would be more problematic.

Finally, it is advisable for landlords to run lien searches on their properties subsequent to the completion of significant tenant improvements to determine whether any liens for tenant improvements have been filed against the landlord's interest which the landlord has not been served with notice of same.

As Florida Statutes §713.08 provides that a claim of lien must be recorded within ninety (90) days from the date the lienor last furnished labor or materials to the project in order to be valid, the lien search should be run soon after the expiration of such 90 day period.

If a landlord fully complies with Florida Statues §713.10 mechanic's liens for tenant improvements can not attach to the landlord's interest in the property, and if the landlord takes a few additional actions, as described herein, the landlord can increase the likelihood that mechanic's liens for tenant improvements will not be filed against the landlord's interest in the property notwithstanding the provisions of Florida Statues §713.10, and that the landlord will discover any potential lien problems arising from tenant improvements well in advance of any sale or refinancing of the property.

Written by Todd Ewing | 02 April 2010

Since November of 2009, when Congress extended the First-time Homebuyer Credit, I have conducted a few hundred real estate closings and have heard a lot of misinformation being shared among real estate agents, mortgage lenders and homebuyers. 

The most common misunderstanding relates to the timeline for qualification. 

Written by Federal Title | 02 April 2010

A daily dose of headlines for real estate agents, mortgage lenders and consumers.

Homeownership for everyone? Wall Street Journal: While many policy makers would resign low and moderate income families to rental housing, a new study makes a case for keeping homeownership at all income levels.	President's new plan will slash mortgage for unemployed Washington Post: HAMP and FHA adjustments will help "responsible homeowners who have been affected by the economic crisis through no fault of their own."
Can housing markets stabilize in 2010 Housing Wire: Now it’s a burning question if the recovery can revive. Or does housing head for a double dip? Can seasonal forces bring last year’s gains back?	People flock to riverfront despite commercial stall Washington Post: Baseball fans arriving from the M Street SE side of the stadium may see boarded-up commercial buildings, but it's only a matter of time before developers' plans materialize.
Former NBA point guard thrives in S. Florida real estate The Real Deal: After 11 seasons in the NBA, including a stint with the Heat in 1996, the former point guard is carving a niche in the Miami commercial real estate market.	Vacationers re-enter housing market The Real Deal: Vacation homes regained some of their popularity last year, while investors increasingly shied away from real estate, according to a new survey.

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Headlines compiled by Strategic Research.