Kellwood Learns What a Deutsche Bank Foreclosure Loan Workout Must Feel Like

Kellwood Co. may not be a helpless homeowner trying to workout a foreclosure solution with Deutsche Bank to stop foreclosure. Actually, Kellwood Co. sells Baby Phat, Sag Harbor and XOXO brands and has learned that when it comes to debt workouts Deutsche Bank plays hardball. However, this is not news to the thousands of homeowners trying to workout a solution with Deutsche Bank to prevent foreclosures.

An Ohio judge dismissed 14 foreclosures filed by Deutsche Bank because they could not prove they owned the homes. However, this did not stop Deutsche Bank from trying to foreclose any way even with no proof of ownership.

According to Forbes reported by the AP, Kellwood Co. announced that one of its biggest lenders Deutsche Bank refused to execute an exchange offer for $140 million in debt due later this month. Kellwood said Deutsche Bank a large debt holder “unexpectedly changed” its position on Friday after it had “helped structure the deal and told us all along that they supported it.”

Now imagine how the helpless homeowner feels when thinking that they worked out a deal with the bank to stop foreclosure and at the last minute the bank pulls out. These are the stories that you don’t and will not see in the media.

This is why foreclosures must be challenged and why it is necessary to become educated on the foreclosure process to protect your home from foreclosure.

http://www.GoFightForeclosure.com

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When Is It Too Late To Do A Short Sale?

The Number of Homeless Continues To Raise As a Result of The Foreclosure Boom

Foreclosures are Expected To Surge Through 2011!

Banks Prefer Foreclosure to Loan Mods.

That's right banks would rather let a property foreclose rather than do a loan mod. The biggest reason for this is that loan modifications DO NOT offer a higher return than foreclosures. Two main reasons for this are stated here by Federal Reserve economists Manuel Adelino, Kristopher Gerardi, and Paul Willen, '

We argue that the data are not inconsistent with a situation in which, on average, lenders expect to recover more from foreclosure than from a modified loan. At face value, this assertion may seem implausible, since there are many estimates that suggest the average loss given foreclosure is much greater than the loss in value of a modified loan. However, we point out that renegotiation exposes lenders to two types of risks that are often overlooked by market observers and that can dramatically increase its cost.
The first is “self-cure risk,” which refers to the situation in which a lender renegotiates with a delinquent borrower who does not need assistance. This group of borrowers is non-trivial according to our data, as we find that approximately 30 percent of seriously delinquent borrowers “cure” in our data without receiving a modification. The second cost comes from borrowers who default again after receiving a loan modification. We refer to this group as “redefaulters,” and our results show that a large fraction (between 30 and 45 percent) of borrowers who receive modifications, end up back in serious delinquency within six months. For this group, the lender has simply postponed foreclosure, and, if the housing market continues to decline, the lender will recover even less in foreclosure in the future.”

Anyone considering doing a loan modification should conder this fact.

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Recent Survey Reveals Many CA Homeowners Don’t Understand Loan Terms

A recent survey conducted by the California Realtors Association revealed that 21% of the buyers either don’t know there loan terms or don’t understand them. The survey goes on to reveal that once the buyer of foreclosed properties are removed 31% of the regular buyers don’t know or are unsure of the loan terms. The survey was conducted by phone with 1400 people in the second half of 2008, further pointed out that most homeowners were not satisfied with the services provided by real estate agents in California.

This survey presents an interesting point for anyone buying a home. According to the survey, most real estate professionals don’t have your best interest at heart. This is to be expected since the real estate industry is a commission-based industry. So therefore, it is highly possible that real estate professionals will tend to put their commission check before you. I am not saying that they are bad people, it just human nature.

That said it would be smart not to rely real estate professionals to a handle all aspects of buying home. Instead, it would be better educate yourself about the home buying process so that real estate professional offer recommendations while you decide on the acceptable terms and purchase price. Failing to do this may result in you getting screwed. A perfect example of this was the sub prime loan craze where real estate professionals where driving homeowners to get loans that they really couldn’t afford nor understand. Then many homeowner saw their mortgage payments double or triple to the point that they van no longer afford to pay the mortgage. Those homeowners to set up to fail as soon as they lined on the dotted line and they didn’t even know it.

If you don’t understand the loan terms or don’t know them you must find out. That goes for anything else that you may not understand about the home buying process. There are many free resources that are available to anyone about the home buying process and mortgage loans so personally, it is unacceptable to hear someone say that they don’t know or understand the loan terms or anything else for that matter. In light of recent events I think it would be smart to know what you are doing before you venture out to buy a home.





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