“Unfortunately,” BofA said in a statement, “many homeowners faced with unemployment, underemployment and other economic hardships have transitioned to alternative housing situations, and in many cases, have walked away from their homes, leaving behind vacant and deteriorating properties that can cause neighborhood blight.”

I considered if I should post this in Positive Real Estate News but I guess it is positive if you are getting the homes.  http://www.bankrate.com/financing/mortgages/bofa-to-give-away-houses/#ixzz1QrpGSkKE

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“Despite rising mortgage rates, our forecast for home sales is stronger than the previous forecast, given our brighter economic growth and labor market outlook,” said Fannie Mae Chief Economist Doug Duncan. “We expect modest increases in home sales, despite recent interest rate rises, due in part to modest additional declines in home prices, and we expect people to take advantage of affordability as their employment and income outlook brightens.”

December 2010 Economic Outlook

Duncan says more positives than negatives for first time in a long time. Consumer spending is up. Improved demand for goods and services.

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A survey by Fannie Mae shows that 70 percent of Americans believe it is a good time to buy a home. That is up from 64 percent in January 2010. Still, 33 percent–up from 30 percent in January–say they’ll rent next time around. About 67 percent believe housing is a safe investment, down from 83 percent of people questioned in a similar survey in 2003. Reuters

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Los Angeles, Calif. (VOCUS)

The Mortgage Bankers Association (MBA) released its results to its Weekly Survey. This survey covers over 50% of all U.S. residential mortgage loan applications taken by retail mortgage bankers, commercial banks, and thrifts. This extremely accurate data gives economists a great look into the consumer demand for mortgage loans. This trend of increasing refinance applications implies consumers are seeking out a lower monthly payment, a fairly predictable assessment. But, the long term effects of this action paint a better picture.

If these consumers are actually able to reduce their monthly mortgage payments they will increase their disposable income, or their “spending money”, giving them the opportunity to spend that spending money which would in turn revitalize the economy. This would create more consumer spending or even allow debtors to pay down personal liabilities like credit cards. This effect could spiral to astronomical proportions because as the more people spend their surplus disposable income, the better the economy gets and the lower the mortgage payments are, creating the effect all over again.

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Effective March 1, 2009, closing of preforeclosure sales may not be conditioned upon a
reduction of the total commission to be paid to real estate agents to a level below what was
negotiated by the listing agent with the borrower, unless the fee exceeds 6 percent of the sales
price of the property in aggregate. Servicers are reminded that they must continue to obtain
any approvals that may be required by interested third parties in connection with preforeclosure
sales.

Fannie Mae loan servicers can no longer require real estate brokers to reduce their commissions as a condition to a short sale approval. This new Fannie Mae policy takes effect on March 1, 2009. According to Fannie Mae, the closing of a pre-foreclosure sale cannot be conditioned upon a reduction of the real estate commission to a level below what the listing agent and borrower negotiated. An exception applies if the total commission is more than six percent of the sales price.

This good news may be tempered by the difficulty for REALTORS® to ascertain whether the underlying loan in a short sale transaction is a Fannie Mae loan. REALTORS® may wish to ask the lender or loan servicer whether the loan is a Fannie Mae loan, and to consider submitting the Fannie Mae Announcement to the lender with the short sale package
Thanks to Barbara Simmons of Simi Valley Real Estate for this great news.

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