GA to Become the 1st Govt. Created Foreclosure Capital
GEORGIA TELLS IT'S HOMEOWNERS TO GO TO FORECLOSURE BECAUSE "WE ARE NOT GOING TO LET YOU BORROW MONEY TO SAVE YOUR HOME!"(:()
Five major lenders and one major buyer of home loans refuse to do business in Georgia if you do not have A credit.
Freddie Mac(the Insurer of high-risk loans) won’t Buy High-Cost Loans effective November 1, 2002 so the lenders that sell to Freddie Mac stop financing them in Georgia.
You see the new Georgia predatory lending law states there are no good faith purchasers (Buyers of mortgage notes)-- leaving them potentially liable for violations by lenders and brokers.
The law also includes an anti-flipping provision.
MORAL
I know where you'll find either some great foreclosure sales or bargain basement buys.
Just go to Georgia and check out the poor borrowers who now have no way to refinance out of their troubles because Big Brother(HUD) is helping them out---OUT ONTO THE STREET THAT IS.
PS. This also a terrific opportunity to help these pre-forclosure owners in GA needing to sell for FULL Market Value or Future Value using Land Trusts combined with the Equity Hold Technique I train!
(Flip side of the Coin so to speak)
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DerrickAli,
Where did you get this info. I suspect if Freddie Mac is doing this in Georgia, then they will be doing this around the country.
Thanks
pkf
Here are the first States to begin this exercise in complicating things for borrowers in trouble.
The proposed and inacted legislation hampers a homeowners ability to find appropriate financing due to the restrictions placed on the lenders and what they charge on 'higher-risk' loans.
Lots of the Big Lenders are already pulling out of States like GA (5 Major Lenders have agreed to NOT do Foreclosure Bailout or Debt-Consolidations in GA any longer.)
Additionally, I have listed some links on the subject:
States inacting the New Law
DC(Suspended 4 Months after Inacting)
California
Georgia
Ohio
Mississippi
New Jersey
North Carolina
The Proposed Problem:
http://banking.senate.gov/pss/predlend/summary.htm
A Suggested Remedy:
http://fic.wharton.upenn.edu/fic/papers/01/0123.pdf
Hope this helps!
DERRICK ALI
PS. If anyone else out there has information on this feel free to jump right in!
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Predatory Scam Busting:
Read this link:
http://www.newsday.com/news/columnists/ny-zcol2950356oct04,0,730142.column?coll=ny%
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CORRECTED LINK:
http://www.newsday.com/news/columnists/ny-bzcol2950356oct04,0,730142.column
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The link still doesn't work.
copy that whole line and paste it in your address bar....
WOW! Home prices here in Southern California have risen dramatically over the last couple of years. Is it reasonable to assume that once this new law goes into effect that the lenders will actually WANT to foreclose on defaulted loans? It makes sense if they can get a property with a FMV of $275K for a defaulted loan amount of $200K! Would it also be reasonable then to assume that people in default on their home loans might be really motivated to sell? Does anyone else have some insight on this issue? It seems as though my creative investment plans are about to be dramatically affected.
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SanDiego Kid:
You are K-Rekt on the investing part and motivation part---However; Lenders CAN'T(read LEGALLY) go after homes this way---First off they are Lenders NOT PROPERTY INVESTORs!
Home homeowners--Especially in CA---are protected from predatory lending and SAAVY INVESTORs--who like yourself can SMELL a Good Deal!
The CA laws and thos like them for numerous other States, frowns upon 'Predatory Investors' whom skim Equity away from unaware pre-foreclosure home owners.
I suggest that you take a LQQK at the California Foreclosure Protection laws. Most of what I do involving my investment efforts in CA(re: Land Trust) is within the guidelines of the law(NICE PLACE TO BE)!
You can also BET YOUR BOTTOM DOLLAR that there's PLENTY -O- COMPETITION In CA---especially Hot! Hot! San Diego--- for these deals!
Funny thing is it's a Seller's MKT! Even when a homeowner is experiencing down times--there is always someone out ther waving CASH-OLLA in their face hoping for the right 'Price' to fall into their lap!
I say just stay CONSISTENT in Talking through their SITUATION(PROBLEMS---read PAIN) and keep them reminded on HOW YOU CAN:
-Help them to Realize 100% or even 150% (given today's appreciation examples inCA) of their Equity!
-Protect their Title and Offer both a Variety + the Most Flexibility in working out of their DISTREES SITUATION!!
Hit them where it hurts---Help em---then feel GOOD about Going to the Bank!
That's my Motto!
Hope this Helps!
Derrick
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