This presents an excellent opportunity for foreclosure business owners to get in this type of business — quick, start making money right away — and all without spending a lot of money. Why/how?

Starting a Foreclosure Cleanup Business — On the Cheap

Foreclosure cleanup business owners can offer a range of services - everthing from pool cleaning and draining to general contracting (eg, putting up walls, repair broken windows and cabinets, replacing tile, etc.). However, some services require skill (and tools and licensing and experience) that many who want to capitalize on this small businesss opportunity don’t have.

But, almost anyone can offer simple securing of homes.

All most lenders want done is for windows to be boarded up, and locks to be changed on doors. Following is a little more info about what HUD requirements are for securing homes. Note: All of this info is provided in detail in the Foreclosure Cleanup Pricing Guide.

Excerpt: HUD Requirements for Securing (eg, Boarding Up Windows and Doors) on a Home 

When boarding is appropriate, all first floor doors and windows, including all basement windows and doors, should have plywood covering the entire opening and frame.  The covering should be secured with carriage bolts.  Eliminate any possible hazards that may be caused by protruding bolts used to secure boarding.  The use of nails is prohibited.

A lot of the specifications from HUD for securing (and other types of work, eg, trashouts and debris removal) vary by location. All of this detail is provided in the Pricing Guide.

Hurricane Season in the Southeast — A Good Way to Pitch Banks/Lenders about Securing Homes

It’s hurricane season in the southeast right now. And, according to a June 2009 article on CarolinaLive.com entitled Securing foreclosed homes during hurricane season:

More than 280,000 homes [were] in foreclosure in coastal counties in nine southeastern states.

That’s only going to get worse as the foreclosure crisis deepens. Hence, it’s a unique way to pitch lenders and realtors about securing foreclosed properties they own/handle. You’ll get a leg up on the competition because it demonstrates that you are in tune with what they’re going through and what they need handled. 

The bottom line is, if you want to start a foreclosure cleaning business — you dont’ have to start with a full range of services. Simple securing homes — a much-needed service for the next couple of years — can be an easy way to start this business — and start making some money right away.

P.S.: While the home foreclosure crisis has meant heartbreak for many, it’s meant opportunity for others. Read how one foreclosure cleaning business owner makes up to $40,000/wk.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

As we’ve talked about here on this blog ad nauseam, the home foreclosure crisis is now affecting those with previously good credit, ie, the average Joe who had a steady job, good credit and always paid his bills on time.

Now, with home prices continuing to plummet and the “jobless recovery” making it hard for those who’ve been laid off/lost a job to find new work, it’s these – the middle class who seems to hold everything together in this country – who are suffering.

Who’s coming to their rescue?

Home Foreclosure: Why the Average Joe Is in Deep Doo Doo

According to the article, Foreclosure crisis phase 2: The negative equity dilemma:

“In the next 12 months it’s going to be tragic – most people are just starting to fall behind now … According to the Center for Responsible Lending, a nonprofit research and policy group, as many as 9 million homeowners could go into foreclosure between 2009 and 2012.”

As the title of the article alludes to, the middle class homeowner is in a financial pickle like never before. They’ve lost jobs – and equity in their homes at the same time. Without equity, they can’t refinance, sell or take out a home equity loan.

Many middle-class homeowners are accustomed to being able “tap their home for equity” (eg, take out a home equity loan/line of credit) when things get tough or they need extra cash to send the kids to college, pay for a new roof, or pay for an unexpected illness not covered by insurance, for example.

That option is gone.

Will the Government Rescue “The Average Joe” from Home Foreclosure?

So, what’s the solution? There is one, as discussed in the aforementioned option, but it’s controversial on many levels.

An option that’s being floated is for “banks to write off part of homeowners’ troubled loans” (ie, write down principal balances to help homeowners keep their homes). But, of course, they don’t want to do this. This is AFTER we’ve bailed their a**es out.

But if the government doesn’t step in to help, or banks don’t come to their darn senses, the outcome is going to be the same because if a homeowner doesn’t have the means to pay, then the home is going to be foreclosed on anyway.

This means the bank will probably have to sell it as a short sale, which means that, on average, they will be getting 20%  less than what it’s worth any way. Note: On average, when a home is sold as a short sale, it’s sold for about 20% less than what it’s worth.

In this market, I’d argue that they’re going to be losing even more because some homeowners have lost 25%, 30% or 40% of the value of their homes.

Home Foreclosures: Many Homeowners Have Lost More than Half the Value of Their Property

A friend of mine who owns property in a suburb of Atlanta was checking home prices in her neighborhood and she found out that there’s a six-bedroom home in the community going for . . . are you ready for this $129,000.

Just five or six years ago, the homes in the community were selling for $160,000 to $200,000. Now they’re selling for as low as $110,000 — these are 3-6 bedroom homes in a lake community.

Now you tell me, why wouldn’t a bank work with a homeowner to keep them in their home – in a community they’re already invested in?

While some may argue that writing down principal balances is not fair to other homeowners (and it’s definitely not), the point is, it’s a done deal. When a home is foreclosed on in a neighborhood (and subsequently sold as a short sale, for example), the neighbors lose value in their homes anyway.

And I keep coming back to this — WE the American people – bailed out these big banks. They got to get a lot of the “bad assets,” which were primarily subprime loans when this whole foreclosure crisis started, off their books.

Why doesn’t the Average Joe get the same kind of help to help him prevent foreclosure?

Stop Foreclosure: Learn the #1 secret your lender won’t tell you that can prevent foreclosure.

P.S.: While the home foreclosure crisis has meant heartbreak for many, it’s meant opportunity for others. Read how one foreclosure cleaning business owner makes up to $40,000/wk.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

Home Foreclosure & Your Finances: Why You Need to Be Worried if You Have Multiple Loans with One Bank

Many consumers today practice what banks refer to as “relationship” banking. They may take out multiple loans with the same institution. Namely, it’s because banks “reward” consumers by offering them lower rates on other loans (eg, car loans, student loans, home equity loans).

But this can be dangerous if you’re in financial trouble. Because of a banking law (that most consumers have never even heard of, mind you) known as the right of setoff or offset. What is it?

The Little-Known Law That Allows Banks to Wipe Out Your Bank Account — Without Notifying You First

The “Right of Offset” the legal right of a bank to seize deposited funds (eg, in your checking or savings account) to cover a loan that is in default.

So for example, let’s say you have a home loan, car loan and student loan with a bank. If you’re significantly late on your student loan, your bank can seize the funds in your checking or savings account to cover this loan.

That’s exactly what happened to the Atlanta, GA resident in the AJC.com article, “Suddenly, bank account was gone.”

Trying to Stop Foreclosure & Have Other Loans with the Bank that Holds Your Mortgage? Advice on What to Do 

I guess the moral of this story is that if you’re facing home foreclosure, which means your finances are not solid, protect the few funds you have from being seized in case you have to move, pay back taxes, take legal action like filing bankruptcy to stop foreclosure, etc.

Learn more about the Right of Offset in the YouTube video below.

P.S.: Finally, an easier way to get foreclosure cleanup work is here. The Property Preservation & Real Estate Industry Contracting & Subcontracting Directory includes over 1,500 industry contacts to help you get more work - quicker and easier.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

Upside Down Real Estate Investor Considers Voluntary Foreclosure

She’s upside down on a few of her homes and many a time has entertained the idea of throwing in the towel – eg, doing a voluntary foreclosure on a few of her properties. But, each time she’s “come back to her senses” (her words, not mine) and decided to soldier on and wait for the housing market to rebound.

Anyway, as we were discussing how crowded both of us had noticed how the retail outlets have been (eg, WalMart, Starbucks coffee shops and movie theatres), she said:

It’s because a lot of people have let go of these expensive-a** mortgages. Now they can afford to spend some money.

As I said, this was a few weeks ago. And, I’ll be damned if it looks like she wasn’t right. Financial/economic experts are saying that the current economic rebound can, at least in part, be attributed to the fact that many homeowners have simply stopped paying their mortgages.

Oh, they’ve continued to pay other bills, but not paying the biggest expense each month has apparently freed up some cash and many are doing a little retail therapy (ie, shopping, eating out, going to movies, etc.). You can view the finance expert in video of the BusinessInsider.com post, Meredith Whitney: The Rebound In Consumer Spending Is Just The Result Of People Not Paying Their Mortgages.

Home Foreclosure & Other News Made by Wall Street Finance Expert on CNBC

Now that government is out of the picture, we seem to getting a clear picture of not only the home foreclosure market, but the credit market and job markets as well. And people, it ain’t pretty. Here’s a roundup of what Wall Street finance expert Meredith Whitney had to say in the video in the link above.

States Are Missing Revenue Homeowners Provide in Property Taxes

States are under water by 200 billion and the government has only offered $50 billion to help. This has led many to cut jobs (at least 2 million nationwide). Programs that affect the poor and the well-to-do alike are being cut.

CA, FL, AZ, NV are states that are severely underwater — because of the housing crisis.

On Consumers NOT Paying Their Mortgages

Consumers not paying mortgages, they’re only paying quote “necessary” bills. This gives consumers more cash because they’re not paying the biggest expense that most of us have (our mortgages). And this is the reason retail spending is up.

Note: Four banks control 2/3 of the mortgages in this country (didn’t know that — surprised the heck out of me. Can someone say, “Monopoly!”). Maybe that’s why banks have been so slow to work with homeowners, ie, write down principal balances and do “realistic” home loan modifictaions).

On Banks, Foreclosure Programs & Home Housing Prices

Banks are accelerating their short sale and foreclosure programs. This means that those who aren’t paying mortgages now will start to have to pay rent – somewhere! FYI, the price of a home usually drops some 20% when a bank does a short sale on it.

Housing prices are going down again – they’ve gone down in the last 8 quarters. Banks have a lot of “rotten assets” (ie, bad mortgages) on their balance sheets.

In 2009, Fannie Mae and Freddie Mac provided more than 95% of all mortgages issued. They’ve in fact kept the mortgage market afloat. What does this mean for the housing market in general? Basically that the activity we’ve seen has been “government induced.” How? 45% of the new mortgages generated in 2009 were under the first-time homebuyer program where buyers got an $8,000 tax credit to purchase.

Corporate America Seems to Have Rebounded (On the Backs of “The Average Joe”)

Large corporations are doing really well (surprise, surprise). But guess what, they’ve fired 3 million workers in this credit cycle. Small businesses have also had a firing spree – firing 5 million workers.

What Happens Now – To the Housing Market, the Credit Markets, the Future for Homeowners

The bottom line is – and I feel like such a broken record here, until the job market comes back strong, it’s going to be tough going. More homeowners are going to lose their homes – and go into a rental market. Many will struggle get (hence, be able to use) credit because your credit takes a hit when you lose your home. And it can take years to rebuild.

And not for nothing, states and local municipalities will be hitting the pockets of those who manage to hang onto their homes harder – because they’re facing record deficits (ie, when there are less homeowners paying property taxes, there’s less money in local government coffers). So what do they do to make up for it? Raise the property taxes on existing homeowners.

Why Many Homeowners Have Stopped Paying Their Mortgages & Are Doing Voluntary Foreclosures

And this is why, in my opinion, many homeowners have looked at the long-term picture and just decided to ditch their homes and start over – maybe buy in 3, 5 or 7 years (and get a better deal) instead of holding onto an underwater cash sucker now.

Home Foreclosure Revenge: Why the Average Joe Is Fed Up . . . and Many Aren’t Taking It Anymore

Until banks and other mortgage holders get realistic and start writing down the principals on mortgages of homeowners who are underwater – and give them realistic monthly payments that reflect the housing, job and credit markets we’re in — THEY’RE going to be the ones holding the bag because you know what, the “average Joe” is friggin’ fed up with getting stuck holding the bag.

And, they’re not taking it any more and are walking away from their homes.

P.S.: Finally, an easier way to get foreclosure cleanup work is here. The Property Preservation & Real Estate Industry Contracting & Subcontracting Directory includes over 1,500 industry contacts to help you get more work - quicker and easier.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

The Guide to HUD Contracting; and

HUD’s Updated M&M Contractors Contact List

It’s like putting your marketing on autopilot. Learn more.

P.S.: Read how one foreclosure cleaning business owner makes up to $40,000/wk.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

Attorney General Cracking Down: Sends “Cease and Desist Notices” to More Than 180 Companies

Lawmakers are getting tougher though. On June 23, 2010, The Attorney General’s Office sent “Cease and Desist” letters to over 180 companies offering “prevent foreclosure help” to New York residents.

Many of these companies offer to help homeowners facing foreclosure get a home loan modification, and/or other types of stop foreclosure services. The problem is, the vast majority of them charge up-front fees to homeowners — which can run in the thousands of dollars. And in the end, the homeowner is still not able to get any type of help. Many go on to lose their homes.

Sadly, the money spent with the home foreclosure scam artists could have been put to better use, ie, paying on their mortgage, getting resettled in another place, paying down other debt, etc.

How Most Prevent Foreclosure Scams Work

Learn how many prevent foreclosure scams. Then, get some concrete, honest advice on how to avoid home foreclosure scams.   

Prevent Foreclosure Scams: Have You Been Contacted by One of These Companies?

If so, don’t do business with them. They have either been sued and/or are in the process of being sued by the Attorney General’s office for running home foreclosure scams on desperate homeowners.

American Modification Agency, a.k.a. Amerimod

Infinity Mitigation Services

National Modification Service

ABM Mitigation Corporation (“ABM”)

Global Modification Services, Inc.,

Raymond, Louis & Fitch (“RLF”)

Stop Foreclosure: Learn the #1 secret your lender won’t tell you that can prevent foreclosure.

P.S.: Read how one foreclosure cleaning business owner makes up to $40,000/wk.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

But considering the post we did here yesterday on HAMP’s efforts in this area (home loan modification), one has to wonder:

How long will these homeowners who got their loans modified via HAMP be able to stay in their homes?

Today’s Report on Home Loan Modifications via HAMP

Following are some fast stats from the MarketWatch.com article, Modifications rise sharply on some mortgage loans.

Home loan modifications tripled in the first quarter of this year, compared to the fourth quarter of last year.

Loans 60 days late or more fell for the first time in two years.

2/3 of home loans modifed in the 4th quarter of last year reduced homeowners’ monthly paymens by more than 20 percent.

Over 6 million homeowners are still in the foreclosure process, or about to go into it (ie, are delinquent).

And it’s this last stat that’s worrisome, especially in light of yesterday’s post, in which we discussed that housing experts predict that up to 75% of those who have had their home loans modified will default at some point in the future. This is because most homeowners are burdened with debt.

And with the economy being what many economic experts call a “jobless recovery,” it doesn’t bode well for many.

Of course, the housing market will recover . . . as will the job market. But, how many more have to lose their homes before it happens?

Only time will tell.

Read the full MarketWatch.com article on how HAMP and it’s home loan modification ”success”.

Buy a Foreclosure Cheap & Enjoy Instant Equity

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Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author

Why Up to 75% of Those Who Get Home Loan Modifications via HAMP are Likely to Default

According to the recent CNNMoney.com article, up to 75% of modified home loans will default, the biggest reason is . .  surprise, surprise . . . debt.

Americans are not afraid to go into debt. And it’s one of the reasons, one could argue, that we got into this home foreclosure crisis to begin with.

Most of us spend more than we make. Proof? According to the aforementioned article:

On average, HAMP-modified borrowers . . . have 64% of their monthly pretax income spent before they even buy a quart of milk. [Hence] If even a small emergency arises — an unexpected car repair, a medical bill or a loss of overtime income — they’re in trouble.

Are Americans Contributing to Their Own Financial Ruin?

Countries like Canada and Japan have high rates of savings among their citizens. For example, the savings rate for Japanese younger than 30 is some 20%. That’s an astounding amount, when you consider that Americans only save between 1% and 4%, according to statistics as of late 2009.

A History of Savings by Americans

It used not to be this way. Americans used to save much more. Proof?

In the first month that the BEA (Bureau of Economic Analysis) provided us with data (January 1959), the personal savings rate in the United States was 8.3%. So, this means that, on average, Americans were able to save 8.3% of their disposable incomes. . . . it would end up falling below 1.0% multiple times between 2000 and 2010. [Source: DaveManual.com]

So we are, in essence, contributing to our own demise.

We drive cars that we can’t afford, buy houses that we can’t afford and overall, live lives we can’t afford.

How We Can Clean Up the Home Foreclosure Mess – And a Host of Other Financial Ills

Many of us need to start living on a lot less than what we make. Most financial experts advise living on 75 to 80% of what you make.

And most housing experts say that your mortgage (and all related expenses like homeowners insurance, HOA fees, property taxes, etc.) shouldn’t be more than 25-33% of your take home pay (not your gross pay).

Most conservative home mortgage experts and financial advisors like for you to stick to the 25% limit.

So if your net pay – after taxes, savings, retirement investments, etc, is $2,000 per month — that means that theoretically, your mortgage and related expenses shouldn’t be more than $500 per month.

How many Americans wouldn’t face foreclosure trouble if they had lived by this formula – and had a habit of saving 20 to 20% of their incomes.

Not only would they have had manageable mortgages, they would have  had nest eggs to get them through hard times like job losses and other unexpected financially troubling times.

So while we can point the finger at bankers, Wall Street and our government all we want, a lot of us need to look at “the man in the mirror,” to quote the Michael Jackson song, to see where fault lies.

Read the full story on how HAMP is failing when it comes to home loan modifications.

P.S.: Start a Reputable Business Cleaning Foreclosed Properties. While the foreclosure crisis has been a nightmare for many, it has presented a perfect small business opportunity for others. Learn how to start a foreclosure clean up business. Read how one foreclosure cleaning business owner rakes in $40,000/wk (not a typo).

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

According to the recent MSN.com article, Presidential homes hit by housing crash, the President’s home in Chicago, which he and wife Michelle purchase in 2005 for $1.65 million, has decreased in value by anywhere from 5% to 20% (real estate experts disagree on the exact amount).

That said, that’s still better than a lot of Chicagoans have fared. The foreclosure crisis  has brought prices in the Windy City down an average of 25% to 30% from peak levels.

And, they’re not the only ones.

The article goes on to assess the value of other Presidential digs, eg, the Cape Cod compound owned by the family of late President John F. Kennedy; Bill and Hillary Clinton’s home in Chappaqua, N.Y; Ronald Reagan’s home in Pacific Palisades, Los Angeles; etc.

View a dozen Presidential homes affected by the home foreclosure crisis on Forbes.com.

Looking for a Home? Buy a Foreclosure Cheap & Enjoy Instant Equity

P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2010 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.