Print written by Dean Moss on Wednesday, February 25, 9:41AM
As foreclosure rates hit historic highs in states across the country, many homeowners have been faced with tough financial decisions. As a result, many animal shelters and pet food pantries are seeing increases in the need to house and feed family pets.
Some time ago I blogged about how a few distressed homeowners simply left their dogs and cats to fend for themselves when they lost their homes to foreclosure. But for some of the more responsible homeowners, parting with their beloved pets was never an option. And now many of these families have to face the challenges of keeping their pets' belly full at night — public aid and food stamp programs don't cover the cost for pet foods.
Pet assistance
As the need for pet assistance continues to grow during these hard economic times, there are many organizations across the country providing some type of aid. The Chicago Tribune reports that here in Chicago, the PAWS No-Kill Animal Shelter offers a pet food bank, available by appointment only, out of the organization's main intake facility at 26th and Drake in the Little Village Neighborhood. The bank is open by appointment only — (773) 475-9426 — and caters especially to those with a sick pet, or those who have hit financial hard times and just can't afford to feed their pet.
Cat owners facing hard times can contact the Treehouse Humane Society at 1212 W. Carmen Avenue. This no-kill cat shelter has a food pantry for cats in need.
On the South Side of Chicago, the Animal Welfare League near 62nd and Wabash, offers a food pantry for those pet owners over the age of 65 or those on public aid. You can contact them at (773) 667-0088.
In Grayslake, IL., the staff reports a 20% increase in relinquished pets compared to a year ago. In neighboring Mundelein, IL., dog trainer Cathie Sabine started Pooch Pantry about a month ago. She accepts donations of dog and cat food all week long, and then gives out the food to pet owners in need every Saturday morning. Sabine's pantry seems to be the first of its kind in Lake County. You can contact her at (847)566-1960 for more information.
Each shelter operator emphasizes they are not open to feed all dogs or cats, but are here to offer some pet assistance for those who have fallen on hard times.
Check out this list from the Tribune of places offering pet food assistance.
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Print written by Dean Moss on Thursday, February 19, 9:44AM
With the economy continuing its descent and the housing market still unable to rebound, foreclosures have begun to affect thousands of homeowners across the Chicago area these days. And it appears that local businesses have also become vulnerable to this ballooning problem. The Chicago Tribune recently reported that Mr. Beef, a popular Italian beef sandwich restaurant in the River North area, is facing a foreclosure lawsuit filed by a bank seeking more than $600,000. The eatery has been around for 30 years, and garnered national attention a few years ago when it was featured on Jay Leno's Tonight Show.
According to the Tribune, 'Joseph Zucchero — one of the owners of the restaurant — had two loans with Midwest Bank that matured late last year. Attempts to refinance the loans were unsuccessful — both applications were rejected by the bank. When the original principal was not repaid on the old loans when they matured, the bank filed a foreclosure action, Zucchero told the Tribune. Zucchero says the bank is attempting to collect $300,000 on the loan collateralized by Mr. Beef, and another $300,000 relating to another Chicago restaurant partly owned by Zucchero.
Mr. Beef still cooking
The owner contends the beef stand is not closing and says his business is strong! Zucchero's attorney, Jim DiChristofano, indicates the bank is awaiting approval of refinancing, and is not acting to shut down the homey Chicago beef joint at this time.
Jay Fritz, Chief Executive of Midwest Bank, refused to comments specifically on the Mr. Beef situation, but said his bank continues to 'lend aggressively' to both new clients and old desperate situations for other businesses across Chicago. With several banks still not lending to small businesses – even success establishments like Mr. Beef – the situation has become desperate for the owners and for their customers who may soon get turned away from their favorite establishments.
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Print written by Dean Moss on Friday, January 30, 2:35PM
I recently read an article in the Chicago Tribune about mortgage scams that got my blood boiling. While the case I read about happened in Florida, it is a situation that can easily happen to any homeowner struggling with their mortgage payments. The scam involves companies that promise to 'stop your foreclosure - GUARANTEED!' But they will do so only AFTER you send them as much as $1,000 or more in up-front 'processing and negotiating' fees!
According to Tribune reporter Kenneth R. Harney, companies taking cash up front, and promise "guaranteed results," better perform as advertised, because if they don't, these companies will likely be charged with running a fraud!
Recently, the U.S. Federal Trade Commission filed a lawsuit against a Clearwater, FL, Mortgage Assistance Company – Mortgage Foreclosure Solutions, Inc. They charged the company with running a scheme to offer and sell mortgage foreclosure services nationwide via half a dozen Web sites. But in all, except in a few scattered cases, they never actually prevented foreclosures at all! The company seemingly guaranteed miraculous results in their advertisements, no matter the size or tardiness of the mortgage, or borrowers' credit credentials and FICO Credit Score.
Borrowers signing up were charged an up-front $1,200 for the service. Yet, in virtually every case, the company failed to prevent foreclosure or save distressed borrowers' homes. Those who did avoid foreclosure say they did so of their own initiative, without help from the company.
Earlier this month, the company settled in court. The Federal Trade Commission (FTC) obtained a judgment of $1.2 Million against the company, as well as an agreement that they would no longer promise guaranteed foreclosure abatement. Mortgage Foreclosure Solutions admitted no wrongdoing as part of the settlement.
According to the Tribune, Cindy Liebes, assistant regional director of the FTC, contends that mortgage rescue companies typically have no special ability or priority to negotiate loan modifications or forbearance on behalf of distressed borrowers. Unscrupulous firms prey on distressed homeowners when they are most frustrated, and most vulnerable, she said.
Liebes warns homeowners having difficulty keeping up with their house payments to avoid companies using the following likely-fraudulent tactics:
1. Guarantees to stop foreclosure, regardless of your financial situation. No legitimate company, she says, would make such a guarantee.
2. Charges an up-front fee before any assistance is undertaken.
3. Advises borrowers to avoid direct contact with the lender, delegating all negotiating duties to the firm. Consumers should note that most lenders suggest that borrowers contact them directly to request forbearance or modification on their mortgage loans in order to best resolve their financial issues.
4. Requires payment of mortgage to the rescue company's office, instead of the lender.
5. Asks for title to the property in advance. You would assume that most homeowners would never fall for such schemes. But unfortunately, many that are in dire financial situations fall prey to this scam!
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Print written by Dean Moss on Wednesday, January 28, 12:03PM
Home builders this past year got hammered by the backlog of housing inventory that just sat on the open market. To lure buyers back to the market, some builders have begun to pony up some lucrative incentives. Horsham, Penn.-based builder, Toll Brothers, is waving a carrot that maybe hard to resist. The national builder, with several large developments in the Chicago Suburbs, is offering very low fixed-rate mortgage loans to qualified buyers for its newly-constructed homes.
The Wall Street Journal reports that Toll Brothers, whose local projects stretch from the Chicago suburbs of Bloomingdale to Barringtion and from Elgin to Morton Grove, is beginning to offer ultra-low, 3.99 percent 30-year fixed rate loans – with no up-front points – to those borrowing as much as $417,000 to purchase one of their newly-constructed homes!
Lowering interest rates to raise the bar
The current national average 30-year fixed mortgage rate is just below 5 percent - the lowest since U.S. investor and guarantor Freddie Mac started keeping records 38 years ago. Will other home builders follow? With stiff competition likely to follow in a feverish attempt to grab the handful of home buyers waiting on the sidelines for the perfect deal to fall right in front of them, it's most likely other builders will pull out some tricks of their own.
For years, to incentivize buyers, and make it easier for them to purchase a newly-constructed home, some builders offered rate buy-downs, which reduce mortgage interest rates for a pre-determined initial period. The rate then increases to a market-competitive level for the balance of the loan. Centex Corporation, the third largest home builder in the U.S., is offering 3.5 percent interest rates for the first two years of the loan on homes under contract by February 2nd. After two years, the rate adjusts and locks to 4.5 percent. To qualify for the deal, Centex is requiring a 3.5 percent down-payment and credit quality that meets Federal Housing Administration standards.
Decreasing resale inventories first
Lower interest rates, of course, result in lower monthly house payments. It is hoped the promise of greater affordability could lure many potential homebuyers off the sidelines and into their new home. Resale inventories, however, remain high across the Chicago area – exceeding 12 months of supply in some Chicago neighborhoods and suburbs – and also across the country. Many neighborhoods are loaded with short-sale and foreclosed, bank-owned properties selling at discount prices – giving newer, more expensive homes a run for their money.
As unemployment continues to rise and the country's financial health still on shaky ground, it may take a lot more than lowered interest rates to lure droves of homebuyers back to the market.
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Print written by Dean Moss on Monday, March 9, 2:10PM
Now, in an even bigger way, one of the largest mortgage lenders in the U.S. has gotten even more aggressive on attempting to halt the rising tide of foreclosed homes on their books. According to the Wall Street Journal, lender J.P. Morgan Chase – one of the largest banks by retail presence in Chicago and in many other markets nationwide – is expanding its loan modification program for distressed homeowners. It now plans to modify loans for buyers whose loans have been sold to other investors, and are no longer owned by the lender itself.
It's important to note that the banks are not writing off losses here, but instead, they are attempting to reduce applicable interest rates – sometimes, drastically – and lengthening the term of many delinquent mortgages. The end result is lower monthly mortgage payments and the increased likelihood that many homeowners will end up staying in their homes, as opposed to losing them to foreclosure.
Renewed efforts by Chase Bank come amidst efforts by the U.S. Senate to allow bankruptcy judges to set new repayment terms for delinquent mortgagors. Big bank Citigroup Inc. supports the new plan, while others are balking.When Bank of America proposed a plan to modify the loans of many holders of Countrywide Home Loan mortgages, after buying the company last year, their investors protested over the $8.4 Billion loan modification program.
J.P. Morgan Chase services two types of mortgage loans – those they keep in their own portfolio, and those they sold to investors. These sold, or 'securitized' mortgages, make up about 75 percent of the lender's $1.5 Trillion in mortgages it services. As expected, some Chase stockholders are not in agreement with the new modification program, fearing reduced financial returns. The opponents of the modifications are arguing that they should not pay for the poor decisions in loan underwriting by someone else.
But the bank is moving forward with its loan modification plans. It has delayed foreclosure filings on more than $22 Billion of mortgages it owns already, and has begun to examine mortgage modification on these loans, according to the Wall Street Journal. More than 80,000 homeowners are impacted here.
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