Throughout the country, people continue to default on their home loans — but lenders have backed off on forced evictions, allong many to remain in their homes, essentially rent-free.

Several factors are driving the trend, industry experts say, including government pressure on banks to modify loans and keep people in their homes.

Allowing borrowers to stay in their homes helps protect the bank’s investment as it negotiates with the homeowner, said a spokesman for a major lender. “If the person’s in the property, there’s less chance for vandalism, and they’re probably maintaining the house, he said. Economists say the situation wo’t last forever, but in the meantime the “amnesty” may allow at least some homeowners to regain their financial footing and avoid eviction.

For some reason, banks are being more lenient with homeowners who are behind on their loans. Whether it’s a strategy to try and slow down the volume of foreclosures or simply a matter of the banks being able to keepup with volume is something that banks only know for sure.

Lenders say the trend reflects their efforts to work with borrowers to modify loans to avoid foreclosure.

Home affordability in California helad steady in the fourth quarter of 2009 at 64 percent, according to a report by the California Association of Realtors.

This means that 64 percent of California households could afford to buy an entry-level home, the same percentage as in the third quarter of 2009, and above the revised 61 percent figure for the fourth quarter of 2008.

The median price for an entry-level home in the state was $257,940; the estimated monthly payment, including taxes and insurance was $1470; and the minimum household income needed to purchases a home at that payment was $44,100, the report said.

The Pending Home Sales Index, a forward-looking indicator based on contracts signed in December, 2009, increased 1% to 96.6 from 95.6 in November, and remains 10.9% above December 2008.

The NAR chief economist said it’s important to recognize how the first-time buyers and repeat-buyers tax credit is skewing market data. “There are easily understood swings in contract activity as buyers respond to a tax credit that was due to expire and was then extended and expanded.  These swings are masking the underlying trend which is a broad improvement over year-ago levels. December activity was the fifth highest monthly tally in two years.

Buyers who have a contract in place to purchase a primary residence by April 30,2010 have until June 30,2010 to finalize the transaction to qualify for a tax credit of up to $8000 for first-time buyers and up to $6500 for repeat buyers.

The economist project the extended and expanded tax credit will encourage 2.4 million households to take the credit in 2010. He added that one of the greatest benefits of rising ssales will be firming home prices.

After four years of decline, the median price for housing in San Diego rose in December. This rise suggests that the bottom of the market has been reached and that the market is now stabilizing. Sales are rising, inventories are lower, interest rates are still very attractive, and buyer interest is growing.

DataQuick reported that the median price rose $5000 to $330,000 after remaining unchanged for four months at $325,000.  It is up 10% from December, 2008’s median of $300,000.

Local economists say that the market is in a period of adjustment and it is unlikely the prices will climb very quickly. They say that it may take a year or more to sort out what has happened.

Another sign of stability was found in the cost per square foot of homes that have been sold. This helps eliminate the differences in homes of a different size, age, and location. Also, higher priced homes are representing an increasingly larger share of the market.

According to the November, 2009 RCI (Realtors’ Confidence Index), 30% of buyers purchased a property with an FHA loan. “FHA helps provide affordable mortgage financing to homeowners, particularly first-time home buyers, reported Vicki Cox Golder, President of the National Association of Realtors. An FHA loan allows homebuyers to purchase a home with just a 3.5% down payment.

The RCI Survey also reported that the number of first-time homebuyers climbed to 51% as these buyers continued to take advantage of the $8000 federal tax credit available through the spring.

The survey said that distressed home sales increased to 33% of the total monthly sales. Both investors and first-time homebuyers are competing for these distressed properties. Because there are so many distressed properties on the market, buyers’ perception of other properties have changed. Buyers look at every property, whether it is distressed or not, as if it is a short ssale or a foreclosure.

In addition, realtors expressed ongoing concern with the impact of the Home Valuation Code of Conduct on recent appraissals. Realtors say that often out-of-area appraisers tend to rely on the sales prices of distressed properties and are not taking into account all of the comps in a neighborhood. Appraisers need to look at all available comps.

A home owner in Encinitas had received a Notice of Default and a Trustee Sale date on his property and was facing an auction and possible eviction in nine days. He had spent many months applying for a Loan  Modification from his lender and had just foundout that the lender would not agree to the loan modification.

Marilyn Dashe, a local Encinitas realtor from Century 21 Sea Coast, worked with this homeowner to list his house as a Short Sale. In three days, he listed his home on the market, had an open house for 70 possible buyers and agents, and received 10 offers on his property. With his agent’s help, he chose the strongest offer, submitted it to the lender, and postponed his date of Trustee Sale.

This Encinitas homeowner is now in the process of having his Short Sale negotiated by a team of processors at Century 21 Sea Coast in Encinitas and expects short sale approval soon. He will then have 30 days to move out of his house and will only experience two years of damage to his credit instead of 7-9 years of damage expected from a foreclosure.

If you are an Encinitas homeowner facing possible foreclosure, please call Marilyn Dashe from Century 21 Sea Coast in Encinitas to learn more about your options. She is certified by the National Association of Realtors as a Short Sale and foreclosure resource.

Local Carlsbad realtor,  Marilyn Dashe, from Century 21 Sea Coast, recently helped a young couple buy their first home in California, a Short Sale in Harbor Pointe in Carlsbad.

She helped them through every step of the Short Sale, explaining the extended timeline of the process since the lender needs to approve the Short Sale and then after lender approval, the property proceeds through the normal 30-day escrow.  It’s often not a smooth process, and the buyers had many questions along the way.

Here’s what the buyers said at the close of escrow: We could not have asked for a better agent to represent us on the purchase of our new home. Marilyn was completely on top of everything from day one and was there for our every need. Short Sales are often long and arduous to deal with, but she handled the entire process professionally and proficiently. We especially appreciated her constant communication with us and her knowledge of Short Sales. She helped us really understand the details of the contract, and made sure that all the decisions made were for our best interest.

If you are a potential buyer of a Short Sale or Foreclosed property in Carlsbad, please consider Marilyn Dashe who is certified as a Short Sale and Foreclosure resource.

Marilyn Dashe, local Cardiff realtor, recently helped a Cardiff homeowner through a Short Sale and helped to make the Short Sale process smooth and painless.

Homeowners in Cardiff who are behind on their mortgage payments become very anxious and stressed and need the help of a real estate professional experienced in Short Sales and Foreclosures.

One Cardiff homeowner chose Marilyn Dashe from Century 21 Sea Coast. The homeowner was afraid of how to handle multiple showings, the ups and downs of having her house on the market, and how long the Short Sale process would drag on. With Marilyn Dashe’s help, this homeowner chose the route of not having a lockbox, having two open houses to collect offers, and selecting the best offer from those submitted.

Here’s what this Cardiff homeowner said: “I wouldn’t have believed it, and Marilyn didn’t promise it, but she sold my house in what was one of the easiest, smoothest events regarding real estate I have ever experienced. She whipped together a plan with the right people to support the process, and we closed in less than six weeks from the first time we met. It’s true. Oh, sure, there were bumps along the way, but she managed to handle everything, leaving me only to feel it was seamless. Oh, and we had fun along the way!” (Sara B.)

If you are considering selling your home in Cardiff as a Short Sale, please contact Marilyn Dashe, certified Short Sale and Foreclosure resource.

Today, Oct. 23rd, The House Ways and Means Committee began meeting to discuss possible extension of the First Time Homebuyers’ $8000 tax credit. Unfortunately, the primary concern is the estimated $139M in fraud that has taken place during the time the tax credit has been available. It appears that non-first-time buyers and minors have taken advantage of the program. 

It is a shame that fraud exists in a program that has successfully helped so many eligible borrowers while at the same time, stimulating the housing market.  Let’s hope that the Committee can make adjustments to eliminate the fraud and keep the program alive!