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Mortgage Delinquency Rate Continues to Plunge

2013 November 14 by

Report: Delinquency Rate Continues to Plunge

BY: ASHLEY R. HARRIS 11/13/2013

Homeowners are working harder to make timely mortgage payments, according recent data from TransUnion . The mortgage delinquency rate dropped 23.3 percent in the past year, ending Q3 2013 at 4.09 percent. Last year it stood at 5.33 percent. The mortgage delinquency rate also dropped on a quarterly basis, down 5.3 percent from 4.32 percent in Q2 2013, the seventh straight quarterly decline.

Around the United States, most states experienced a decline in their mortgage delinquency rate between Q3 2012 and Q3 2013. California, Arizona, Nevada, Colorado, and Utah experienced more than 30 percent declines in their mortgage delinquency rate. Three states—California, Florida, and Nevada—had double-digit percentage drops in the last quarter.

TransUnion cultivated the data from anonymized credit data from virtually every credit-active consumer in the United States. TransUnion’s forecast is based on various economic assumptions, such as gross state product, consumer sentiment, unemployment rates, real personal income, and real estate values. The forecast would change if there are unanticipated shocks to the economy affecting recovery in the housing market or if home prices begin to depreciate once again.

“This isn’t a sample data set,” said Tim Martin, group VP of U.S. Housing for TransUnion’s financial services business unit.

“We looked at all 52 million installment-based mortgages in the U.S. and the trend is clear—the percentage of borrowers willing and able to make their mortgage payments continues to improve,” Martin continued. “The overall delinquency rate is still high relative to ‘normal,’ but a 23 percent year over year improvement is great news for homeowners and their lenders.”

The credit agency recorded 52.31 million mortgage accounts as of Q3 2013, down from 54.23 million in Q3 2012. This variable was as high as 63.14 million in Q3 2008 prior to the housing crisis.

Viewed one quarter in arrears (to ensure all accounts are included in the data), new account originations increased to 2.34 million in Q2 2013, up from 2.09 million in Q2 2012. This is a major increase from just two years ago when there were 1.32 million new account originations in Q2 2010.

“New mortgage originations showed good growth through the second quarter of this year, largely the result of increased refinance transactions driven by low rates and increasing home prices,” Martin said. “However, mortgage rates started to increase right around Memorial Day, and when the data come out next quarter, we expect it to show that new originations are decreasing as a result.”

TransUnion’s latest mortgage report also found that the non-prime population (those consumers with a VantageScore credit score lower than 700) continues to represent a smaller portion of all mortgage loans, more than 50 percent lower than was observed in 2007. Non-prime borrowers constituted 5.82 percent of all new mortgage originations in Q2 2013. In Q2 2008, non-prime borrowers represented 12.69 percent of the total.

TransUnion is forecasting that the downward consumer delinquency trend will continue in the final three months of 2013. The delinquency rate will likely be just under 4 percent at the end of the year.

“New originations will be down and non-prime borrowers will start to re-emerge,” Martin said. “At this point we believe delinquency rates will continue to decline.”

©2013 DS News. All Rights Reserved.

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Scary Bogus Collection Calls From Someone Claiming To Be With the Government.

2013 November 8 by

A client of mine has been receiving calls at home and work from a “collection agency” saying they are going to haul him off to jail and press charges against him if he does not pay the money he owes.

When I called the number provided., 1-904-410-2217, I spoke with a man who put me on hold to transfer me to their attorney.   When the attorney picked up the line he sounded just like the gentleman who answered the phone.   Nevertheless, he claimed to be a lawyer with the Financial Crimes Enforcement Network  (see for the official government site).   He said his name was “George Schneider.”   He said he was being paid very well by the FinCen and didn’t need to speak with me.

Mr. Scneider, who sounded more like an Ahmed, refused to provide me with any information about the alleged case or crimes and told me he would only speak with a criminal lawyer.

I asked him for his attorney bar number.   He refused.

I asked him for the case or file number.  He refused.

I asked him for his address.   He refused.

I asked to speak with his supervisor.  He refused and got angry.

He demanded my client call him back personally or he was going to jail.

That’s NOT how an attorney reacts to another’s call in the real world.

This is a bogus off-shore collection call!

This is not the first one my clients have experienced.   I was fortunate to even speak with a real person.  Typically, when I call the “collection agency’s” phone number they will disconnect the call once they know I am an attorney.  When I call back, the number is mysteriously disconnected.

I googled the phone number and collectors like this one and found a Consumer Alert at

Here is what the web site says:

“FinCEN Warns of Ongoing Financial Scams (03.25.11)

FinCen (Financial Crimes Enforcement Network) recently sent out a reminder to the public to be on alert to ongoing financial scams that attempt to solicit funds from unsuspecting victims. They have received calls and reports of financial scams attempts conducted via the telephone. The caller represents themselves as an employee of FinCEN and ask for the victim by name, usually at the victim’s home telephone number. The caller will identify an outstanding debt; this debt may be actual or bogus. The call will provide the victim with account, Social Security or other similar number and demand that immediate payment be made. The caller’s knowledge of the victim’s name, telephone number, account description and personal information serves to legitimize the caller.

FinCen has become aware of another financial scam conducted via email and telephone in which a person claiming to be a representative of the U.S. Department of Treasury of FinCEN informs them that they have received a large Treasury Department grant. To obtain the grant, the victim is instructed to provide bank account information and make some type of initial payment or donation.

Recipients of these calls, letters, or emails should not respond to such messages, and should not send money or provide any personal or confidential information. Those who believe that they are or have been a victim of the financial scam, should report this information to local, State, or Federal law enforcement authorities.

FinCEN does not send unsolicited request and does not seek personal or financial information from members of the public. FinCEN does not have authority to freeze assets or block funds transfers. In addition, correspondence may purport to be from an overseas office of FinCEN. FinCEN does not have any offices outside of the US.”

Don’t tolerate this kind of abuse and criminal behavior.   Call your state and local authorities and report the call.  It’s a scam.


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HAMP’s Redefault Rate at 27% and Likely to Rise

2013 November 1 by


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Over the life of the government’s Home Affordable Modification Program ( HAMP ), 1.25 million homeowners have received permanent HAMP modifications, and 27 percent of those have later redefaulted on their loans, according to a quarterly report to Congress from the Office of the Special Inspector General for the Troubled Asset Relief Program ( SIGTARP ).

In its report released to lawmakers this week, SIGTARP berated Treasury for not heeding the office’s previous recommendations regarding HAMP , stressing that the inspector general expressed concern in April that “the number of homeowners who have redefaulted on HAMP permanent mortgage modifications is increasing at an alarming rate.”

About 184,000 homeowners (29 percent) who received HAMP modifications through TARP rather than through the GSEs have redefaulted, costing taxpayers $972 million in incentives paid to servicers and investors for those workouts, according to SIGTARP . Among borrowers participating in the GSEs’ HAMP programs, just under 154,000 (26 percent) have redefaulted ( HAMP incentives on GSE loans are paid by the GSEs themselves). Additionally, about 10 percent of all active permanent HAMP modifications were one or two months delinquent as of the end of August.

“The longer a homeowner remains in HAMP , the more likely he or she is to redefault out of the program,” SIGTARP stated. The redefault rate among the oldest HAMP modifications is 48.3 percent, according to SIGTARP’s report.

Homeowners who fall three months behind on their modified payments redefault out of the program and fall “often into a less advantageous private sector modification or even worse, into foreclosure,” SIGTARP said.

About 32 percent receive another modification, often a proprietary one, and about 13 percent work out a short sale or deed-in-lieu of foreclosure with their servicer. About 22 percent of HAMP redefaulters enter foreclosure.

SIGTARP also reported the breakdown of redefaults by servicer, finding that three servicers account for almost 60 percent of HAMP redefaults: Ocwen Loan Servicing, JPMorgan Chase, and Wells Fargo. While these three servicers contributed the greatest number of HAMP defaults, none of the three ranked highest in terms of the percentage of HAMP redefaults.

Among the eight largest servicers participating in the government program, Select Portfolio Servicing had the highest percentage of redefaults with 43 percent of its HAMP-modified loans falling behind on payments. Ocwen and Bank of America followed with 31 percent of their HAMP loans defaulting again. Twenty-five percent of Nationstar’s HAMP loans have redefaulted.

SIGTARP said in April that “Treasury still does not understand … the reason the permanent modifications in HAMP actually failed.”

The inspector general stated in the latest report to Congress, it was “a positive sign that following SIGTARP’s April 2013 recommendations that Treasury initially expressed its commitment to assessing and reducing redefault rates. . . . Following that, however, on July 22, 2013, Treasury posted a blog” defending the HAMP program and stating in the post, “mortgage modification programs include an inherent risk of homeowner default, given the difficult situations homeowners face when they seek assistance (like job loss).” In the same defensive posture, Treasury stressed “that not all will succeed” in the HAMP program.

For its part, SIGTARP said “ HAMP is a program that has been plagued with servicer misconduct” and recommended Treasury “research and analyze whether and to what extent the conduct of HAMP mortgage servicers may contribute to homeowners redefaulting” in order to ensure homeowners in HAMP are getting sustainable relief from foreclosure. SIGTARP charges Treasury with establishing a benchmark for redefaults, measuring the program against that benchmark, and revealing the results to the public.

Treasury has responded that “it cannot establish a benchmark without SIGTARP’s guidance,” to which SIGTARP responded, “it is up to Treasury to set performance standards for its own program and measure the participants’ performance.”

In its report to lawmakers, SIGTARP also revealed basic characteristics of HAMP modifications. The vast majority—95.9 percent—include an interest rate reduction. About 63.2 percent include a loan term extension, and 15.3 percent include principal forgiveness.

Treasury has extended the HAMP application period for two years until December 31, 2015.

©2013 DS News. All Rights Reserved.

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New Means Testing Income Information Released Today

2013 October 31 by

The U.S. Trustee’s office released new median income figures for means testing today.  The following table provides median family income data for Colorado.   These median income figures will apply to all bankruptcy cases filed in Colorado after November 15, 2013.

Family Size
State 1 2 3 4
Colorado $50,242 $65,701 $71,138 $83,330
Add $8,100 for each individual in excess of 4.

To see information for all 50 states you can visit the US Trustee’s web site:

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Bankruptcies in Colorado Down 47.6%

2013 October 25 by

The United States Bankruptcy Court for Colorado keeps monthly statistics that are available on the court’s web site.     You can see them by clicking here:

When I compared bankruptcy filings in September 2010 to September 2013 I discovered the following information:

  • Chapter 7 cases filed in Colorado are down 40% from 2 years ago
  • Chapter 13 cases filed in Colorado are down 55% from 2 years ago.

Overall, personal bankruptcy cases filed in Colorado are down 47.6 percent.

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Number of U.S. Mortgages Going Unpaid = 4,594,000

2013 October 25 by

Lender Processing Services provided the media with a “first look” at the company’s mortgage performance statistics for the month of September.

The industry’s foreclosure inventory continued its downward trend, and while delinquencies were up slightly from the previous month, they were down when comparing the numbers year-over-year.

LPS counts a total of 3,266,000 mortgages nationwide that are 30 or more days past due but not yet in foreclosure. That tally represents 6.46 percent of all outstanding mortgages.

September’s delinquency rate is 4.23 percent higher than the rate reported for August, but remains 12.63 percent

below September 2012’s rate. Of the more than 3 million delinquent loans, LPS says 1,331,000 have missed at least three payments but haven’t started the foreclosure process.

Another 1,328,000 mortgages are currently winding their way through foreclosure pipelines, according to LPS’ data. That total puts the nation’s pre-sale foreclosure inventory at 2.63 percent in September, down 1.29 percent from the month prior and down 32.18 percent from last year.

All-in-all, there are 4,594,000 mortgages going unpaid in the United States. Comparatively speaking, the nation’s non-current total stood at 5,640,000 in September 2012.

LPS reports the states with the highest percentage of non-current loans (non-current combines foreclosures and delinquencies as a percentage of all active loans in the state) include: Florida, Mississippi, New Jersey, New York, and Maine.

North Dakota has the lowest percentage of non-current loans among states, followed by South Dakota, Alaska, Montana, and Wyoming.

LPS’ findings are derived from its loan-level database representing approximately 70 percent of the overall mortgage market. The company will provide a more in-depth review of this data in its monthly Mortgage Monitor report, which is scheduled for release in early November.

By: Carrie Bay

©2013 DS News. All Rights Reserved.


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Chapter 13 Bankruptcy Payments Can Be Made On-Line

2013 October 23 by

For years my Chapter 13 bankruptcy clients have asked if they can pay their monthly chapter 13 plan payments on-line.   The answer has been “no” … until now!

If you are in a chapter 13 bankruptcy case in Colorado and your bankruptcy trustee is Douglas B. Keil, you can now make your monthly trustee payment over the internet.  Go to to sign up.     Douglas Keil is the chapter 13 bankruptcy trustee for most cases in the southern part of the Denver Colorado metro area and the southern part of the state.

Unfortunately, Sally Zeman, the other Chapter 13 Trsutee, does not presently offer an option to pay your chapter 13 payments on-line.

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You Can Be Held Legally Responsible For Your Spouse And Child’s Medical Bills And Education In Colorado

2013 October 15 by

In Colorado parents and spouses can be held financially response for their kids and spouse’s medical and educational debts as well as other debts.   Legally, this is known as The Family Purpose Doctrine.

It’s codified in the Colorado Revised Statute at  CRS 4-6-110.   The statute states: “The expenses of the family and the education of the children are chargeable upon the property of both husband and wife, or either of them, and in relation thereto they may be sued jointly or separately.”  You can read all the annotations here: C.R.S. 14-6-110

This frequently comes up in my practice where the parents are sued by medical providers for medical services provided to their children.  This is especially true when they are uninsured or under-insured.

Another common example of this is when a spouse is admitted to a hospital for care.  Later, when the bill cannot be paid, the hospital sues both the patient and their spouse for the debt.  They are able to sue the spouse who did not receive the medical care because of this statute.

Medical debts have historically been one of the top causes of personal bankruptcy.  Fortunately, bankruptcy eliminates medical debt whether you received the treatment or are just being held financially responsible for it.

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Access Your Chapter 13 Bankruptcy Case Online

2013 September 18 by

If you filed bankruptcy in Colorado and your chapter 13 trustee is Doug Kiel, then you can access information about your bankruptcy case, including plan payments, on-line by setting up a free account at This site lets you view the details of your Chapter 13 Case any time.  I highly recommend it.

Have the following information on hand when you sign up:

  • Your Chapter 13 Case number
  • Name of Chapter 13 Trustee
  • Your Social Security Number
  • Your current address

I recommend that all my clients who have Doug Kiel as their trustee create an account on this site.

If your trustee is Sally Zeman, she does not have a web site you can access to review your case and payment history.  However, you can always call her office at 303-830-1971 and speak with her knowledgeable and helpful staff.

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Questions you will be asked at a Chapter 13 Meeting of Creditors in Colorado

2013 August 30 by

I have attended hundreds of meetings with the bankruptcy trustee with my clients in both chapter 7 and chapter 13.   Clients are often very nervous and unsure about the meeting of creditors.    No one wants to appear in a public place to be questioned about their bankruptcy and finances.

The Meeting of Creditors is less like going to Court, and more like going to the DMV to register your case (in most cases).   However, the unknown is usually scary.

So … In order to serve my clients better and prepare them for the meeting I complied a list of general questions the Trustee will most likely you.  Hopefully they will be a help to you.

  1. The Trustee will swear you in.
  2. Please state your name, address.  (If there are 2 of you, the second person can just say “same address” if you live at the same address).
  3. Have you ever filed bankruptcy before?  If so, when and where?
  4. Are you still employed at XYZ and making the same you were when you filed bankruptcy?  (Please let the attorney know if you have changed jobs or received an increase/decrease in income since your bankruptcy was filed).
  5. Is there any other source of income besides your employment?
  6. How many people are in your household?
  7. Do you own any real estate?
  8. If so, how did you determine its value?  When did you purchase it?  How much did you purchase it for?  What do you think it would sell for today?
  9. If no, then: Have you ever owned any real estate in the last 4 years?  (Please let the attorney know if you have).
  10. Your Plan calls for X number of payments of $______ per month.  Have you made your first payment?  Will you be able to make your Plan payments on a regular and timely basis?
  11. Over what period of time were the bulk of your debts incurred?
  12. Have you listed all your debts?
  13. Have you listed all your assets?

After the attorney asks you the above questions, s/he will then ask if there are any creditors who wish to ask questions.  The only creditors who appear with any degree of regularity are the IRS, the Colorado Department of Revenue, ex-spouses who want a pound of flesh, and ex-business partners who have a bone to pick.  Most creditors never appear at these meetings.

In addition to these questions, the Trustee’s Attorney may ask some questions specifically relating to your bankruptcy.

ONLY ANSWER THE QUESTIONS THAT ARE ASKED.  Do not offer more information than what is requested.  If you are unsure what to answer you can ask your attorney, who will be sitting right next to you.

After you have been examined by the Trustee’s Attorney you are free to leave.

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