Bank of America Signs On to Arizona Hardest Hit Principal Reduction Program.

Recent newsletter from Arizona HFA HERE says:

Bank of America announced at the end of February that it would be participating in the principal reduction program. Currently, Bank of America is sending out solicitations to qualified homeowners who may be eligible for this program. Homeowners are then instructed to call Bank of America to receive information regarding the required documents that need to be submitted in order to be evaluated for the program. While this is a significant development for the program,it is important to note that only loans that Bank of America owns, approximately 20 percent of their servicing portfolio, are eligible for the program

Originally created and posted on the Oregon Housing Blog.

HUD Auctioning 150 FHA Foreclosures in Phoenix Area to Owner Occupants with $100 Down.

ABC15.com story on March 26th auction is HERE; list of homes HERE. Relatively uncommon I think for HUD to use auctions to sell homes in bulk. 

$100 down is good sales tool, but didn't excessive leveraging help cause problem in first place? [Would be fascinating to track future sales / foreclosures on these units to see if flips/ foreclosures happen; the 1 year owner occupancy pledge has often not been monitored/ enforced by HUD].

Originally created and posted on the Oregon Housing Blog.

Hardest Hit Housing State Plan Analysis: Geographic Allocation Methods Show Wide Variations.

I have looked at the proposed geographic allocations in the three complete Hardest Plans I currently have copies for and am struck by the wide variations in the methods used. (All three plans are combined in link in right pane, Hardest Hit Plan Submissions, First Round States).

1. Arizona: Their plan states what the allocation is going to be, with no supporting background data. From page 9 of their plan: "Based on the geographical makeup of our market place we suspect approximately 75 percent of these households will be in Maricopa County, which includes the Phoenix metropolitan area. It is estimated that of the remaining 25 percent of households to be assisted is estimated to be 9 percent will be in Pinal County and 8 percent will be in Pima County with the remaining 8 percent spread throughout other rural counties in the state."
2. Florida: Pages 60-62 of their plan provide detailed formulas used to calculate the geographic distribution and include county level data. The formulas used include housing cost decline, a double weighting of unemployment, and county share of seriously delinquent loans.[Note that for second round states Treasury did NOT use housing cost decline in their decision on distribution between the second round states].
   
3. Michigan: On page 71, they propose NO geographic distribution in their plan: "The Authority does not anticipate targeting this assistance on a geographic basis, nor have we anticipated specific hard income limits. However, in practical terms these programs will overwhelmingly assist working and middle-income families."

(Note: No guarantee that any of these methods will be accepted by Treasury).

Some Thoughts for Oregon (and other Second Round States):

1. There is a wide latitude of choices made about geographic distribution, along with supporting data provided.
   
2. For any geographic distribution it is important for transparency purposes to provide the specific data, sources, and formulas used to calculate the allocations. (Without locking into the Florida exact formulas, they have done a VERY good job in documenting their sources, methods, and data).
3. Not ALL funding needs to be geographically distributed, some can be held back for statewide or special project purposes.
4. An alternate to provide the greatest amount of flexibility in Oregon would be to use an EXISTING county level definition of economic distress found in state statutes. The formula used is described HERE, the Administrative Rule is HERE, and the current county level results are shown HERE.
   

Originally created and posted on the Oregon Housing Blog.

HFA Hardest Hit Plans Received from Michigan and Arizona.

I am very pleased that both the Michigan and Arizona housing finance agencies have provided me with copies of the Hardest Hit housing plans they submitted to Treasury.

I have combined those plans along with the Florida plan I previously posted into a single PDF file HERE. For future reference, the same document can be found in the links section in the right pane as "Hardest Hit Plan Submissions, First Round States".

Public Thanks to Michigan and Arizona HFA's
I want to publicly acknowledge the promptness and completeness of the information provided by both Michigan and Arizona in response to my public record requests for their plans. Electronic copies were provided within days of my request at no charge.

I will try to post some highlights of what I see in the Michigan and Arizona plans as time permits.

Caveat: These are NOT the Final Plans, But Only the Plans Submitted to Treasury
There likely will be extensive conversations between the first round applicants and the Treasury. I expect substantial changes could be made in the plans submitted so please do NOT represent these plans as THE finally approved plans. (I expect the finally approved plans will eventually appear on the US Treasury website).

Plans Submitted by California and Nevada Not Yet Received.
I have public record requests outstanding for the two remaining states, California and Nevada. I am following up with both requests and will post what I receive as soon as I receive it.

Originally created and posted on the Oregon Housing Blog.