Ilyce

The real estate market is in such flux, that several years ago home buyers would never consider walking away from their obligations and walking away from a mortgage. However, times have changed and more and more home owners see less of a stigma attached to walking away from a mortgage. As falling home prices have decimated the real estate market in some parts of the country, people view the ability to walk away from a mortgage as another option along with bankruptcy, negotiating for a loan modification and refinancing a loan. Years ago, people viewed bankruptcy as a morally bad thing to do. But with more and more people suffering in this recession, walking away from a mortgage is seen more as somewhat unusual but not necessary as a morally bad thing to do.

When a loan servicing company goes out of business, you would think that the troubles would be over for those borrowers that had been dealing with that lender. Think again. Taylor Bean and Whitaker Mortgage Company went out of business last summer. Their customers are still feeling the pain. They may have new loan servicing companies, but the new loan servicing companies won't honor the amounts these borrowers paid TBW in their escrow accounts. You would think that escrow accounts (money held by a lender in trust on behalf of their borrowers) for the payment of real estate taxes and insurance premiums would be safe. But those accounts are frozen. You'd think that the federal government would have a law on the books that forces lenders to keep those accounts safe and segregated and readily available to transfer from one lender to another. And yet, months after TBW's bankruptcy, customers are still waiting for money, answers and are suffering with increased payments to their new loan servicers.

While you may buy vacant land to build a home in the future, some real estate investors and speculators, purchased vacant land with timber on it to sell off the land or timber in the future. Now the real estate market has changed along with the housing market, and the value of vacant land has decreased. Worse, for those people that purchased the land for the value of the timber, wood prices have gone down as well. Now, real estate investors have to decide whether to keep the land and timber for a time in the future when prices will have recovered or take their losses now.

You might want to think about a loan modification as similar to a loan application with additional paperwork. Most lenders can give you the package of information they will need to get a loan modification started and processed. If you were able to apply for your mortgage loan, you should be able to get results in your loan modification on your own. While you may want to hire an attorney to assist you in the loan modification, the companies and attorneys that are helping in loan modifications are billing anywhere between $500 and $3000. At this point, we have not seen evidence that lenders are granting more permanent loan modifications to people that have hired attorneys or loan modification companies over people that have completed the loan modification process properly and have followed up with their lenders.

MoneyWatch Ask The Experts: Jill Schlesinger, Jack Otter, and Ilyce Glink Talk Housing Market. The federal government has poured trillions of dollars into the U.S. housing market in the form of tax credits and the purchase of more than a trillion dollars in U.S. housing-backed securities. Is that what's propping up the housing market? Last week, Ilyce was in New York at MoneyWatch.com headquarters and taped this podcast with Jack and Jill.

Real Estate Update - Ilyce Glink and Jill Schlesinger of MoneyWatch.com Discuss The Housing Crisis. I spent some time shooting video and recording a podcast with CBS Editor At Large Jill Schlesinger. We talked about the housing and credit crisis, real estate and what's coming next.

Today on the Ilyce Glink Show we discussed the latest economic news and events. We talked personal finance, real estate, and took questions from callers to answer questions on how to make the best decisions with your money. Are you joining us in Atlanta on March 27 for How To Profit From Foreclosure? Visit RealWorldSeminars.com and use discount code MONEY for a special 2 for 1 deal on full-price tickets.

Refinancing today is hard enough. But refinancing after bankruptcy can be almost impossible. Years ago, lenders would refinance anybody at almost any time, even if they had a recent bankruptcy, a low credit score, or poor credit history.
You can check out your credit report by obtaining a free copy at www.annualcreditreport.com. If you do, you can get one copy per year of your credit report from each of the three major credit reporting bureaus. If you filed for bankruptcy recently, you will find quite a number of obstacles you will need to cross prior to getting a loan approved.

The first time home buyer tax credit and the existing home buyer tax credit have limitations. The first time home buyer excluded people that have owned a home within 36 months of the purchase of a new home. The existing home buyer tax credit excludes buyers if they have not owned a home for at least five out of the last eight years. That might leave a gap with first time home buyers or existing home buyers (or even move up buyers). Why? Because you can own a home and have owned it two to five years and can't qualify for either tax credit. And if you are married, you will exclude your spouse as well from getting the credit.

Now that you closed on a home, you want to get the tax credit. Be careful, you will need to send more than usual to the IRS to prove that you are entitled to the $8000 or $6500 tax credit. So before you push to e-file your tax return, make sure you understand that you won't get the refund you were expecting unless you send in the documents required to get the tax credit. The first time home buyer tax credit is $8000 and the move up or repeat home buyer tax credit is $6500.