The WeBuyTucsonHomes Blog

From the azstarnet.com

KB Home has torn down its three model homes at its abandoned Saguaro Springs project in Marana. Liability concerns led to the demolition last week, a company spokesman said. Back in 2005, plans for Saguaro Springs called for 2,400 homes near Rattlesnake Pass just west of the Tucson Mountains.

But although roads were paved and some infrastructure was put in, the project never got off the ground and the model homes sat vacant and gutted for years. KB Home had partnered with California-based Empire Land LLC until Empire filed for bankruptcy last year. The site is now up for auction.

There are multiple videos on youtube.com highlighting multiple model homes being torn down. This is the first I have seen from Tucson or Phoenix of homes being demolished. If there are others please comment on it.

The same scam artist story is repeating itself over and over again.  If you are in foreclosure and need help there are plenty of places to go.  WeBuyTucsonHomes will be glad to help answer any question you may have regarding the process, how to delay or even stop the foreclosure, or assist you in finding a reputable place for a loan modification.  One thing any reputable company will never do is charge an upfront fee.  Your scam alarm should be going off if someone is offering to stop or delay your foreclosure but they want hefty upfront fees.  Many times a company will receive money from the bank for helping to modify the loan, also there are plenty of government sponsored entities that will assist you with no fees.  It sickens me to see the scams so prevalent in the area.

Arizona republic reports

Foreclosure-rescue scams have shot up 30 percent in Arizona during the past few months.

Arizona Attorney General Terry Goddard delivered that startling statistic last week at the Arizona Foreclosure Prevention Task Force meeting. It was the right crowd to engage about the growing problem.

“Firms are contacting homeowners on the verge of foreclosure, offering help and instead taking the money the homeowner has,” Goddard said. “We have a real obligation to find these people and prosecute them.”

The latest foreclosure-rescue scam involves loan modifications, the program that’s the backbone of the federal housing plan announced in February. In a loan modification, a lender and homeowner work out a deal to cut interest rates and even principal on mortgages of homes in danger of foreclosure.

Free counselors, certified by the U.S. Department of Housing and Urban Development, are available to help homeowners work with lenders. Arizona homeowners can call the state’s foreclosure hotline at 877-448-1211 to find a counselor. There also are reputable private firms, run by attorneys, mortgage brokers and real-estate agents, offering loan-modification help.

But a growing number of scam artists that have joined the scene, promising help, taking hefty upfront fees and then leaving homeowners on their own.

Data released last week shows mortgage companies have made more than 55,000 offers to modify loans since the program was launched in March. There are 14 companies, which service about 75 percent of all U.S. mortgages, signed up to do loan modifications.

The federal program was expanded to help people who can’t afford their mortgages and don’t qualify for a loan modification. They may be able to still avoid foreclosure by using new streamlined processes for short sales or deeds in lieu. Like with modifications, lenders and borrowers can get $1,000 or more to work out deals to avoid foreclosure.

The different federal housing programs continue to confuse many homeowners and servicers at lenders agreeing to participate, slowing the process.

“What is needed is a coordination of policies between all lenders on both the modification and refinancing programs,” said Jay Luber, Galaxy Lending president.

One week after allowing the new $8,000 tax credit to be used in helping with a down payment for first time home buyers, Federal officials reversed course and declared the tax credit could not be monetized.  The Arizona Republic reports

Federal officials on Monday reversed an earlier decision to allow first-time home buyers to use an $8,000 tax credit to borrow the down payment on a home.

A week earlier, U.S. Department of Housing and Urban Development Secretary Shaun Donovan had told the National Association of Home Builders that HUD would let banks and local governments offer short-term “bridge loans” to cover the down payment for first-time buyers eligible for the tax credit. The loans would have been available to applicants for federally insured mortgages such as Federal Housing Administration loans.

Lenders, home builders and real- estate agents had reacted favorably to the bridge-loan proposal, saying it would open up the housing market to more first-time buyers.

However, not everyone was in favor of using the tax credit as collateral on a down-payment loan.

“That tax credit should be savings, not debt,” said Patricia Garcia-Duarte, executive director of Neighborhood Housing Services in Phoenix.

Garcia-Duarte said the proposal too closely resembled a now-illegal practice known as seller-funded down-payment assistance, which allowed a home’s seller to “gift” the down payment to a specific buyer through a non-profit organization.

Phoenix loan originator Dean Wegner was among the housing-industry professionals who had expressed enthusiasm about the bridge-loan plan.

Wegner said the program would have boosted local home sales, but he added that the bridge loans likely would have come with a high interest rate.

The loans also could have created income-tax issues, according to the IRS officials who shot down HUD’s plan.

Still, Wegner remains optimistic that the government will seek other means to circumvent the FHA’s required 3.5 percent down payment.

“They will probably come out with a zero-down FHA loan starting January 1, once the $8,000 goes away,” he said.

The government should not allow this tax credit to be monetized in the form of a loan. From above - “the credit was to be monetized via a short term loan from the local banks and governments;” offering short term loans with the promise of repayment coming from next years tax return sounds like many of the “Pay Day Loan” centers business plans.  Banks are already struggling with loans that homeowners and consumers can not repay, allowing this credit to be monetized would only allow new homeowners to struggle with more debt with exhorbinant interest rates.  One can only imagine the surprise when expecting large tax returns(read vacations) for the next few years only to have it swiped away by the bank or local government as repayment for a loan.

Edit: The AZ republic has posted a note stating the credit can still be applied directly toward home purchase costs when using an FHA-insured mortgage. However the person will still have to come up with a 3.5% down payment.