Housing’s new worry: Repeat foreclosures return

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After the worst national housing crash in history, the picture of distress continues to improve, but now with one worrisome aberration. For the first time in more than two years, the number of repeat foreclosures took a U-turn and was higher in January compared to a year ago.

Repeat foreclosures are when a home has been in the foreclosure process once, was somehow saved by either a loan modification or payment program, but then goes back into foreclosure. This can happen when the borrower either can’t or won’t keep up with the new payments. New repeat foreclosures rose 11 percent in January from December and accounted for more than half of all new foreclosures, according to Black Knight Financial Services.

The problem is worst in states where a judge is required in the foreclosure process. These so-called “judicial” states have a far longer time horizon for processing foreclosures and therefore have huge backlogs of troubled loans in limbo.

Analysts at Black Knight say they are unsure what’s driving the numbers. They point to some seasonal factors and do not believe the problem is due to the government’s mortgage bailout program (the Home Affordable Modification Program), which has a five-year term. Some of those first modifications from 2009 are turning into pumpkins. As such, they do report a slight uptick in resets under the program but say those would not materialize into new foreclosures until May at the earliest. The problem may in fact be far more basic.

“It’s not surprising because so much tinkering was done with defaulted borrowers over the last five or six years. It’s not surprising they’re running into problems again,” said Guy Cecala, CEO and publisher of Inside Mortgage Finance.

 

 

During the worst of the crisis, banks were put under increased pressure to modify loans even outside the government bailout program. They lowered interest rates, but in the end, many of their borrowers simply didn’t have the basic cash flow to pay, whatever the rate. Re-default rates were expected to be high, with some calling even 40 percent conservative.

In the meantime, completed foreclosures have been decreasing more rapidly than the backlog of seriously delinquent loans. The hope had been for the opposite and a quick return to a more normal level of distress. There are still more than twice as many troubled loans than normal, despite rising home values and an improving economy. In other words, the mortgage mess isn’t all cleaned up just yet.

SATURDAY March 14 Events!

SATURDAY, MARCH 14, 2015
Ongoing Tours at Leilani Farm Sanctuary in Haiku
12:00 AM Nature Conservancy of Hawaii
7:00 AM Maui Filipino Chamber of Commerce’s Annual Scholarship Golf Tournament
07:00 AM – 01:00 PM Maui Girlz Shave Ice to Donate 100% of Sales to Aloha Backpack Buddies Program 
07:00 AM – 01:00 PM Maui Swap Meet 
07:00 AM – 12:00 PM Upcountry Farmer’s Market 
 08:00 AM – 01:30 PM  Bocce Ball Tournament
08:00 AM – 02:00 PM Fundraising Garage Sale for Feline Foundation of Maui
08:00 AM – 05:00 PM Maui Nui Farm Farmers Market in Kula every Thurs, Fri, Sat, Sunday from 8am to 5pm
08:00 AM – 01:00 PM Maui Puerto Rican Association Food Drive to Benefit Maui Food Bank
08:00 AM – 02:00 PM Trail of the Whale
09:00 AM – 04:00 PM 2-night service trip in Haleakala Crater
09:00 AM – 01:00 PM Community Exchange Event
09:00 AM – 02:30 PM Malama Honokowai – Maui Cultural Lands, Inc.
10:00 AM – 02:00 PM 24th Annual Lu’au of Keawala’i Congregational Church
10:00 AM – 03:00 PM Easter Mini Photography Session
10:00 AM – 05:00 PM Exhibit: Schaefer Portrait Challenge 2015
10:00 AM – 11:00 AM Leilani Farm Sanctuary Tour
01:30 PM – 10:00 PM GO FOR THE GREEN 1st Annual St. Patrick’s Day Shindig
02:00 PM – 08:00 PM Lomi Lomi Nui • Kahuna Bodywork Training Retreat
04:15 PM – 06:30 PM #KaiCapische-A Taste of Sardinia Sunset Cruise
05:30 PM – 09:00 PM 3rd Annual Book Trust Extravaganza: Casino Royale
05:30 PM – 09:00 PM 3rd ANNUAL BOOK TRUST HAWAII FUNDRAISER 2015 BOOK TRUST EXTRAVAGANZA: CASINO ROYALE
06:00 PM – 08:00 PM Maui Miracle Prophetic Service 

Remodel Before you Sell

Interior

Sprucing up your home before putting it on the market makes it more attractive to buyers, which can help you sell it faster and for more money. If you’re thinking of doing some painting or adding some color to your home, consider using Marsala.

As Pantone’s 2015 color of the year, Marsala will soon be showing up in homes and on runways. This reddish-brown tone gives any room an earthy look, but it’s important not to overdo it or you could end up turning off buyers. Here are some tips on how to use this color effectively in your home:

  • Use it as an accent wall. Many buyers prefer seeing neutral colors when it comes to walls, so painting every wall in a room with a non-neutral color won’t impress them. Instead, choose one wall as an accent wall and paint it with Marsala. Leave the rest of the walls in white or another neutral shade.
  • Pair it with warm hues. Since Marsala is an earthy tone, it works well when paired with other warm hues, such as brown or yellow. Again, though, make sure you don’t overdo things with too much color. For example, if Marsala is your accent wall color, include a few throw pillows in warm shades to enhance it.
  • Use just a hint of Marsala. If you don’t want to paint an entire wall with Pantone’s 2015 color of the year, you can still use this color in your home in smaller ways. Look for accent pieces that feature this color, or consider painting a small niche area or some cabinetry in your home with it. This will make the area seem warmer and more inviting without going overboard.

Need more help preparing your house for the market? Call Joseph Hogin,Broker with NextHome Pacific  808-870-2775