Although many of the large banks claimed to have foreclosures on hold while they review their procedures it appears they didn’t “hold” back much in the Greater Houston Area.

While the number of foreclosed property is slightly lower than previous months it not what I would call a HOLD.  More like a slow down.

Did I mention that some of the foreclosures were by Bank of America?!?

Harris County shows 786 foreclosed in November vs 1,246 foreclosed in October.

Fort Bend County shows 114 foreclosed in November vs 170 foreclosed in October.

Montgomery County shows 108 foreclosed in November vs 138 foreclosed in October.

Bottom Line:  Don’t trust the bank unless you have it in writing and then still watch your back (and the small print).

- The Bank Slayer

*data from Foreclosure Information & Listing Service, Inc.

Although some of the largest mortgage banks (servicers of mortgages) such as Bank of America, Wells Fargo, Chase and GMAC have announced in varying releases that they are halting foreclosures while they review their procedures, they haven’t stopped posting and prepping to auction off over 5,000 homes in the Greater Houston Area.

How many folks are posted for sale tomorrow?    Yes, tomorrow – November 2, 2010.

Harris : 3,857

Brazoria: 251

Ft Bend: 675

Galveston: 279

Montgomery: 400

Total: 5,462

How many will go tomorrow?  Good question.   On average about 20-25% actually go to sale.   The best commitment most get out of the foreclosure attorneys is “that file is on HOLD.”

On Hold huh?   Like I’m holding this piece of paper…wait, not any more.  I just let it go.

Pulling the sale or postponing the sale is what we want to hear.  On Hold?  Does this mean I need to call back tomorrow and check again?

Whether you are a homeowner facing foreclosure or a concerned REALTOR assisting a family in a tough situation don’t just assume that the “On Hold” means the foreclosure is postponed.  Maybe you’ll still be on hold, maybe you won’t when the clock strikes 10:00AM on Tuesday.

If every mortgage was “on hold” then why did a couple of our homeowner clients need to secure a Temporary Restraining Order last Friday…Hmmmm.

- The Bank Slayer

The following FAQ is a reprint of the FAQ provided to Texas Realtors and on the affect to various types of foreclosure related transactions such as REO sale, Short Sales, Evictions and Foreclosures.

>>>>>   TAR – FAQForeclosureMoratorium100610

Much of this remains to be seen but it is worth reading and noting possible issues that may arise.

- The Bank Slayer

The following is the list of mortgage servicers (lenders) that have been initially targeted by Texas Attorney General Greg Abbot’s office for possible foreclosure fraud.

If your loan is in a foreclosure status or you have been wrongfully foreclosed within the last four years please seek assistance immediately.

- The Bank Slayer

Looks like the banks collectively thumbed their noses at the Texas Attorneys General Office and marched forward with foreclosures yesterday, except for GMAC/Ally.  The Houston Chronicle caption reads…

“Foreclosure sales go forward as Texas AG pushes moratorium“

But here at BustMyBank we predict that the banks’ excrement is about to make physical contact with an electric powered oscillating air device.

Below are comments we received from the Texas Association of REALTORS® Legal Department.

To: Texas REALTORS®

From: Texas Association of REALTORS® Legal Department

RE: Texas Attorney General halts foreclosures and sales of foreclosed properties

The Texas Attorney General’s office has halted all foreclosures, all sales of properties previously foreclosed upon, and all evictions of persons residing in previously foreclosed upon properties, until mortgage companies have completed a review of their processes, including whether employees or agents “robosigned” affidavits and other documents recorded in Texas.

The AG suspension notices were sent to 30 mortgage-loan servicers doing business in Texas.

Further, here is a copy of the letter sent to Bank of America.

Texas AG letter to Bank of America on foreclosure halts

Seems pretty clear to me that BofA is going to be in a heap of trouble with any foreclosures wrongfully prosecuted.   Seems to me that those folks facing evictions have a little more time to work things out.  Semms to me that if you are trying to buy a foreclosure you may want to cool your heels and definitely do some title examination.

If you have been foreclosed upon and suspect something was not done properly then contact us immediately.

9 out of 10 foreclosures we analyze have document issues such as: fraduelent assignments, “missing” links in the chain of title, fabricated ownership claims, and/or the foreclosure mill attorney signing documents making themselves the trustee, seller’s authority, purchasing bank’s agent, and overall uber-agent all rolled into one.

It seems VERY likely that there are THOUSANDS of foreclosures that are in violation of many of the statutes and laws put into place to protect homeowners.

Does this mean that no one deserves to be foreclosed upon for not paying their bills?  No it doesn’t.  What it means is that there is a right way for a creditor to claim what is his and there is a wrong way and experience tells us that the banks are enriching themselves at the expensive of the downtrodden and down on their luck.  The guy paying his mortgage and those families paying taxes are getting the shaft from “the too big to fail” banks who have sucked up our taxes dollars and now are “too big to play by the rules” when it comes to stealing someone’s homestead.

Don’t let the banks roll over you.  Stand up for your rights.

- The Bank Slayer

“Texas Attorney General Greg Abbott called for a halt on foreclosures Monday amid nationwide scrutiny over the way they are processed.”

The fraud in the mortgage industry has finally hit a raw nerve.   27 mortgage servicers have just been put on Notice to HALT the sale of foreclosures and homes in the foreclosure processes.

Just a minute there...let's look at your papers.

Mortgage servicers have until October 15th to respond to questions about their processes and the now infamous “robo-signers”.

On 650 AM, in the Houston area, I fielded calls and questions about the impact of this request by Greg Abbot’s office.   This hits a raw nerve for lots of folks: buyers, sellers and homeowners.

A general halt or freeze of all foreclosure related activity has far reaching consequences not just to homeowners who might have fallen behind on their payments but to anyone involved in the “foreclosure” process.  If you are buying a foreclosure this could affect you as well as those involved in insuring the sale such as title companies.

For homeowners struggling to make their payment and facing a foreclosure this COULD provide a little more time to resolve payment problems.

Will the major banks continue forward with today’s foreclosure sales?  We’re making calls today to determine just that and we’ll  stay tuned to see the reaction of the “big three” – Bank of America, J.P. Morgan Chase & Wells Fargo.

For REALTORS working a short sale, this might buy some more time to complete the sale.

Below is the press release in the Houston Chronicle

– The Bank Slayer

State moves to halt foreclosures and sales of foreclosed property

By NANCY SARNOFF, PURVA PATEL and JENNIFER HILLER
HOUSTON CHRONICLE / SAN ANTONIO EXPRESS-NEWS

Notices to suspend foreclosures were sent to 27 loan servicers doing business in Texas, including Bank of America and JPMorgan Chase, the Attorney General’s Office said. It did not have the full list of companies available late Monday.

The state office also called for a halt on the sales of properties previously foreclosed upon — possibly affecting auctions scheduled Tuesday —  and on evictions of people living in such properties.

The office said it began investigating foreclosures last month after reports that an employee of Ally Financial, a large mortgage lender, acknowledged signing thousands of foreclosure documents without reviewing them as required.

Ally has since suspended foreclosures on certain properties in 23 states, as have JPMorgan Chase and Bank of America, to investigate whether their employeesrushed foreclosures, a practice called “robosigning.”

In the state’s letter to JPMorgan Chase, Paul D. Carmona, chief of the attorney general’s consumer protection and public health division, said robosigning practices can include signing documents without reading them, signing thousands of documents a month, signing documents without proper notarization, and signing affidavits falsely claiming personal knowledge of facts.

Court order not sought

A JPMorgan Chase spokesman declined to comment on the attorney general’s move, and Bank of America officials could not be reached late Monday.

Chase and Bank of America, along with Wells Fargo, service more than 50 percent of the outstanding loans nationwide, said David Zugheri, co-founder of Houston-based Envoy Mortgage.

Abbott sought the foreclosure suspension Monday “in an effort to determine the full harm Texas homeowners may have suffered or could suffer as a result of these business practices,” according to a statement released late Monday by Jerry Strickland, a spokesman for the office.

The Attorney General’s Office has not sought a court order, and wouldn’t say what kind of action, if any, it might take if companies don’t comply.

“This is a demand from the Attorney General’s Office that they thoroughly review their business practices to ensure they comply with Texas law and are not unlawfully harming Texas homeowners,” Strickland said.

The move could have a widespread impact on Texas borrowers and lenders.

“If the AG can really do this, it’s huge,” said Zugheri.

George Roddy, president of the Addison-based Foreclosure Listing Service, which tracks foreclosures in 19 North and Central Texas counties, questioned the attorney general’s authority to seek the suspensions. “I’m not sure how the AG could do that unless there’s some type of fraud,” he said .

And stopping the sale of properties already lost to foreclosure could prove particularly complicated.

“This could be opening up a real can of worms if they’re actually talking about properties already sold,” Roddy said. “Title has been passed back to the lender or a third party has purchased it at the foreclosure auction. Someone else could be living in the house.”

‘An October surprise’

Gregg Stanley of RexReport.com, a San Antonio-based foreclosure listing service, said that the 23 other states where foreclosures have been suspended require lenders to go to court to foreclose.

Texas has non-judicial foreclosures, which don’t require court orders. But in its letter, the Attorney General’s Office said the state nonetheless requires various documents with foreclosures and wants to be certain that paperwork is handled properly and in compliance with state law.

“It could be a bit of an October surprise,” Stanley said, noting that foreclosure auctions are scheduled across the state today. Harris County’s auction is scheduled to start at 10 a.m. in the Family Law Center downtown.

In its letters to JPMorgan Chase and Bank of America, the Attorney General’s Office outlines steps the banks must take, including identifying employees or agents who participated in “robosigning.”

The letters ask the lenders to respond by Oct. 15.

Tuesday, September 7th is Foreclosure Tuesday.   Here is a quick look at the Houston area foreclosure stats:

Posted Homes for Foreclosure

Posted foreclosures for the Greater Houston Area total 6,689 which is a 43% jump from last month’s 4,478.   Galveston County continues to rocket forward with a 53.7% increase over August’s posted foreclosures.  Fort Bend County was not far behind with a 49.1% increase in postings.  Harris County and Brazoria County finished neck to neck with increases of 38.2% and 36.7% respectively.   If there was a winner it is Montgomery County with only a 30% increase.

Regardless of county, the local Greater Houston Area is seeing a big leap in lenders pursuing foreclosures.

• 309 vs 226 for August – Brazoria County (Pearland, Alvin, Lake Jackson, etc.) +36.7% increase
• 874 vs 586 for August – Fort Bend County (Missouri City, Sugar Land, Richmond, etc.) +49.1% increase
• 375 vs 244 for August – Galveston County (Galveston, Clearlake, Texas City, etc.) +53.7% increase
• 4,649 vs 3,361 for August – Harris County (Houston, Pasadena, Baytown, etc.) +38.2% increase
• 482 vs 371 for August- Montgomery County (Montgomery, Conroe, Splendora, etc) +30.0% increase
• 6,689 – Total

With such a large number of postings, although not every house will be sold, the local real estate market is going to struggle to absorb the increase in foreclosure inventory.  As an example let’s look at the numbers moving through the Houston Association of Realtor Multiple Listing Service.

Currently there are 54,926 properties for sale in the greater Houston area.  Of this number, 4,778 are REO (real estate owned), commonly called foreclosures; this accounts for 8.2% of the market.  Add in Short Sale listings for another 1,807, which is 3.3% of the market and you now have 11.5% of listings which are distressed sales. Distressed sales typically drive down prices.  Especially when roughly one out of every ten homes for sale is a distressed sale.   But if the market can absorb them, in other words they are selling as fast as they come in, then everything is still OK.

Let’s look at how fast the distressed sales are moving.  Last month, in the Greater Houston Area, 941 of the properties in MLS sold as “foreclosures” and another 109 sold as “short sales”.  That means that only 1,050 properties out of the 6,585, or 16% of the distressed sale category actually sold through.  At this rate it would take roughly six months to sell through the distressed inventory – but this assumes that no new properties are listed for sale.  But remember we have 6,689 properties posted for the foreclosure sale.

We’ll have to closely watch the sell through rate as well as the actual number of properties that foreclose to see if our market can handle the inevitable and eventual and likely substantial increase of distressed listings.

Foreclosures for Sale* -4,778

• 264 – Brazoria County (Pearland, Alvin, Lake Jackson, etc.) +3.2% (+0.9% MOM)
• 551 – Fort Bend County (Missouri City, Sugar Land, Richmond, etc.) +8.2% (+12.2% MOM)
• 360 – Galveston County (Galveston, Clearlake, Texas City, etc.) +9.1% (+5.0% MOM)
• 3,155 – Harris County (Houston, Pasadena, Baytown, etc.)  +0.4% (+2.1% MOM)
• 448 – Montgomery County (Montgomery, Conroe, Splendora, etc.) +2.6% (+7.7% MOM)

Short Sales for Sale on MLS – 1,807

• 78 – Brazoria County (Pearland, Alvin, Lake Jackson, etc.) +8.9% (+4.0% MOM)
• 226 – Fort Bend County (Missouri City, Sugar Land, Richmond, etc.) +1.4%  (-5.4% MOM)
• 106 – Galveston County (Galveston, Clearlake, Texas City, etc.) +16.5% (+8.2% MOM)
• 1,260 – Harris County (Houston, Pasadena, Baytown, etc.) + 1.8% (+1.7% MOM)
• 137 – Montgomery County (Montgomery, Conroe, Splendora, etc) -5.6% (-2.8% MOM)

Foreclosures Sold in MLS in July – 1,070

• 47 – Brazoria County (Pearland, Alvin, Lake Jackson, etc.)
• 118 – Fort Bend County (Missouri City, Sugar Land, Richmond, etc.)
• 67 – Galveston County (Galveston, Clearlake, Texas City, etc.)
• 741 – Harris County (Houston, Pasadena, Baytown, etc.)
• 97 – Montgomery County (Montgomery, Conroe, Splendora, etc)

Short Sales Sold in MLS in July – 109

• 3- Brazoria County (Pearland, Alvin, Lake Jackson, etc.)
• 15 – Fort Bend County (Missouri City, Sugar Land, Richmond, etc.)
• 3 – Galveston County (Galveston, Clearlake, Texas City, etc.)
• 77 – Harris County (Houston, Pasadena, Baytown, etc.)
• 11 – Montgomery County (Montgomery, Conroe, Splendora, etc)

Foreclosures Sold in MLS in August- 941

• 46 – Brazoria County (Pearland, Alvin, Lake Jackson, etc.)
• 91 – Fort Bend County (Missouri City, Sugar Land, Richmond, etc.)
• 54 – Galveston County (Galveston, Clearlake, Texas City, etc.)
• 659 – Harris County (Houston, Pasadena, Baytown, etc.)
• 91 – Montgomery County (Montgomery, Conroe, Splendora, etc)

Short Sales Sold in MLS in August – 69

• 3- Brazoria County (Pearland, Alvin, Lake Jackson, etc.)
• 14 – Fort Bend County (Missouri City, Sugar Land, Richmond, etc.)
• 3 – Galveston County (Galveston, Clearlake, Texas City, etc.)
• 42 – Harris County (Houston, Pasadena, Baytown, etc.)
• 7 – Montgomery County (Montgomery, Conroe, Splendora, etc)

* Foreclosures & Short Sales are combination of HAR MLS & non-MLS REO/Corporate sales, averaged over 2 months.

**MOM = Month over preceding Month

Tuesday, August 3rd is Foreclosure Tuesday.  Here is a quick look at the Houston area foreclosure stats:

Posted Homes for Foreclosure

• 226 – Brazoria County (Pearland, Alvin, Lake Jackson, etc.)
• 586 – Fort Bend County (Missouri City, Sugar Land, Richmond, etc.)
• 244 – Galveston County (Galveston, Clearlake, Texas City, etc.)
• 3,361 – Harris County (Houston, Pasadena, Baytown, etc.)
• 371 – Montgomery County (Montgomery, Conroe, Splendora, etc)

Foreclosures for Sale on MLS

• 262 – Brazoria County (Pearland, Alvin, Lake Jackson, etc.) +5.6%
• 491 – Fort Bend County (Missouri City, Sugar Land, Richmond, etc.) +4.2%
• 343 – Galveston County (Galveston, Clearlake, Texas City, etc.) +13.2
• 3,091 – Harris County (Houston, Pasadena, Baytown, etc.)  -1.3%
• 416 – Montgomery County (Montgomery, Conroe, Splendora, etc.) -2.4%

Short Sales for Sale on MLS

• 75 – Brazoria County (Pearland, Alvin, Lake Jackson, etc.) +13.7%
• 239  – Fort Bend County (Missouri City, Sugar Land, Richmond, etc.) +8.1%
• 98 – Galveston County (Galveston, Clearlake, Texas City, etc.) +24.1%
• 1,239 – Harris County (Houston, Pasadena, Baytown, etc.) + 1.8%
• 141 – Montgomery County (Montgomery, Conroe, Splendora, etc) -8.4%

Citing the need to protect borrowers from mortgage payments that potentially balloon out of control, Fannie Mae is putting forward new standards for the purchase and securitization of adjustable-rate mortgage (ARM) products.

Why stop now?  You have unlimited U.S. taxpayer money.   Everyone NEEDS to have a home.  More loans, more loans, more loans.  A mortgage loan in every pot.  Say it together.

Bottom Line:  Until homeowners are educated on the true and total cost of home ownership AND brokers stop gouging folks, a tweak here or there will be countered by lenders needing to make a fast buck and will continue to dupe borrowers.

- The Bank Slayer

Fannie Modifies Criteria for Purchase and Securitization of ARMs

Citing the need to protect borrowers from mortgage payments that potentially balloon out of control, Fannie Mae (FNM ^[1]: 1.22 -3.17%) is putting forward new standards for the purchase and securitization of adjustable-rate mortgage (ARM) products. The government sponsored entity is also tweaking its rules on interst0only products.

“There is no trust in this business” said the foreclosure trustee.  Scary huh?  This isn’t some fictional story.  This is real life in Harris County, Houston, Texas.

Recently, members of our team confronted the Trustee that was about to auction off the homestead of one of our clients.  In our hand was the Temporary Restraining Order, the ink still wet from a Judge’s signature; effectively stopping the foreclosure sale and saving this home owner.

When the TRO was handed to the Trustee he feigned surprise and acted as if he didn’t care one way or another if some local Judge had ordered the foreclosure sale to stop.  Why? He was on a mission for the bank or possible his buddies.  Sell the house.

As he glanced at the TRO our team said, “I guess that’s all you need.”  The Trustee’s retort, “You going to stick around to see if I still sell the house?”   Incredulously we said, “I trust you’re going to follow the Judge’s order.”  His curt reply, “There is no trust in this business.”

Amazing huh?   Sadly this Trustee who is supposed to sell a home to the highest bidder and show impartiality between the bank and the homeowner is untrustworthy.

Just take a trip down to the foreclosure auctions.  You’ll quickly see that homeowners are getting the shaft.

We have witnessed trustees high fiving each other after clearing the sale board.  why? Not a single house sold to a third party buyer, in other words they bid back every house to the bank.

Bottom Line: You can’t trust the trustee.  Want another example…read on below.

- The Bank Slayer

Department of Justice Press Release – Stockton Real Estate Executive Pleads Guilty to Bid Rigging at Auctions of Foreclosed Properties

For Immediate Release
April 16, 2010 United States Attorney’s Office
Eastern District of California
Contact: (916) 554-2700
From Dan Edstrom:

Stockton Real Estate Executive Pleads Guilty to Bid Rigging at Auctions of Foreclosed Properties

SACRAMENTO, CA—United States Attorney Benjamin B. Wagner and Assistant Attorney General Christine Varney of the Department of Justice’s Antitrust Division announced today that Anthony B. Ghio, 43, of Stockton, pleaded guilty today before United States District Judge Edward J. Garcia to conspiring to rig bids at public real estate foreclosure auctions held in San Joaquin County.

These charges arose from an ongoing federal antitrust investigation of fraud and bidding irregularities in certain real estate auctions in San Joaquin County. The investigation is being conducted by the U.S. Attorney’s Office for the Eastern District of California, the Antitrust Division’s San Francisco Office, the Federal Bureau of Investigation, and the San Joaquin County District Attorney’s Office.

According to Assistant United States Attorneys Robin R. Taylor and Russell L. Carlberg, who are prosecuting the case with assistance from Barbara Nelson and Richard Cohen of the Antitrust Division, Ghio admitted in his guilty plea that he conspired with a group of real estate speculators who agreed not to bid against each other at certain public real estate foreclosure auctions in San Joaquin County. The primary purpose of the conspiracy was to suppress and restrain competition and obtain selected real estate offered at San Joaquin County public foreclosure auctions at noncompetitive prices.

Court documents show that after the conspirators’ designated bidder bought a property at a public auction, they would hold a second private auction. Each participating conspirator would submit bids in the private auction above the public auction price. The conspirator who bid the highest amount at the end of the private auction won the property. The difference between the noncompetitive price at the public auction and the winning bid at the second auction was the group’s illicit profit, and it was divided among the conspirators in payoffs. Ghio participated in the bid-rigging scheme from April 2009 until October 2009.

Ghio is charged with bid rigging, a violation of the Sherman Act, which carries a maximum penalty of 10 years in prison and a $1 million fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victim of the crime, if either of those amounts is greater than the statutory maximum fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.

The investigation is continuing. Anyone with information concerning bid rigging or fraud related to real estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at 415-436-6660 or visithttp://www.justice.gov/atr/contact/newcase.htm, or the FBI’s Sacramento Division at 916-481-9110, or the U.S. Attorneys Office for the Eastern District of California at 916-554-2900.

Media inquiries to the U.S. Attorney’s Office should be directed to Lauren Horwood at 916-554-2706. Media inquiries regarding the department’s Antitrust Division should be directed to Gina Talamona at 202-514-2007.

This law enforcement action is part of President Barack Obama’s Financial Fraud Enforcement Task Force.