Blockchain Lending: Reduced Fraud or Increased Risk?

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Traditional lenders are transforming, adopting cutting-edge technology to stand apart from competitors and introduce an added level of security to financing. From AI-run algorithms to smart contracts, obtaining a mortgage could soon be a vastly different process than buyers experienced just 10 years ago. Industry disruptors, however, are looking to shift from the traditional model completely, threatening to take over the role typically performed by bank intermediaries, which buyers are accustomed to.

One new business claims it is the first company to apply blockchain to mortgages. Block66 is a blockchain-based marketplace for lenders, from which they can access vetted buyers looking to finance their mortgage. Co-founded in 2017 by CEO Joe Markham, CPO James Tuckett and COO Kamil Mieczakowski, the platform is set to launch in early 2019. The most significant benefit the company is advertising? Reduced risk for mortgage fraud.

“We created Block66 to offer new opportunities for borrowers and end the time-consuming and paper-driven processes in the mortgage industry,” said Joe Markham, founder and CEO of Block66, in a statement. “Our platform will make it easier for everyone to find what they need so mortgages can be approved and funded faster. By storing the history of each transaction on the blockchain, we will provide a valuable audit trail for lenders, which will help mitigate mortgage fraud.”

Additionally, Block66 states the addition of blockchain to a real estate transaction will reduce costs for buyers, as they will not have to be vetted via banks; instead, applicants’ information will be made public to any lenders using the platform. Block66’s loans, which will become asset-backed tokens, will reportedly play a role in leveling the lending playing field, allowing all types of investors (not only big banks) to participate, and giving way to increased applications for buyers who would not be considered worthwhile by larger banks.

“The idea behind mortgage tokenization is to bring in smaller lenders,” said Markham. “They are often reluctant to tie themselves to longer repayment plans but are more willing to lend capital to customers who aren’t always favored by traditional banking institutions, even though they are creditworthy.”

The risk? While bank intermediaries are often more costly—resulting from the manpower needed to not only vet candidates for creditworthiness, but to ensure financials are in order and paperwork is completely submitted—they often add another layer of security to the transaction that the new technology cannot be trusted to replicate at this time. Often, these banks become reliable vendors for real estate agents who have partnered with them, providing buyers with vetted mortgage lenders who not only get clients to the closing table, but also prioritize customer service and become community resources.

There are other challenges, as well. Smart contracts are not yet recognized by courts on a global level, an obstacle for Block66 when transacting across borders. Additionally, while applicant and property information is publicly displayed on the blockchain, the technology is still new, adding uncertainty into the equation for smaller banks who do not typically risk lending long-term loans. Applicants may still find ways to bypass this technology-based security and fraudulently represent the assets or financial history necessary to buy.

Liz Dominguez is RISMedia’s associate content editor. Email her your real estate news ideas at ldominguez@rismedia.com. For the latest real estate news and trends, bookmark RISMedia.com.

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5 Tips for Buying a Foreclosed Home

(TNS)—Buying a foreclosed home is not like the typical home purchase.

In many cases, only one real estate agent is involved.

The seller wants a preapproval letter from a lender before accepting an offer.

There is little, if any, room for negotiation.

The home is sold as-is, and it’s up to the buyer to pay for repairs.

On the upside, most bank-owned homes are vacant, which can speed up the process of moving in.

“Buying a foreclosure is definitely a bit of a grind. It’s not easy,” says Robert Jensen, broker and president of the Rob Jensen Co. in Las Vegas. “You’re getting fantastic pricing, but sometimes it takes going through a lot of houses and writing a lot of offers to get the home you want.”

Find a real estate broker and a lender.
The first two steps for buying a foreclosure should be taken at the same time. While you’re looking for a real estate broker who works directly with banks that own foreclosed homes, get a preapproval letter from a lender.

Elaine Zimmerman, a real estate investor and author, recommends that shoppers first visit any site with a database of foreclosed homes. You also could look at a local real estate website that lets you filter the results to see only foreclosures.

You might find the acronym REO, which means “real estate owned.” This signifies that the property has been foreclosed on and the lender now owns it and is selling it.

Get a broker on your side.
The goal of combing through foreclosure listings is not to find a house; it’s to find an agent. Banks usually hire real estate brokers to handle their REO properties. In many cases, the buyer works directly with the bank’s broker instead of using a buyer’s agent. That way, the commission doesn’t have to be split between two brokers.

“A lot of these REALTORS® have a long-term relationship with these banks, and they know of listings that haven’t even come on the list yet,” Zimmerman says. “Call them about the listings that you’re interested in, but also ask them about listings that may be coming up, because sometimes it may take a day or two or even a week before a listing actually comes onto the database.”

Get a preapproval letter.
Unless you plan to pay cash, you’ll need a recent preapproval letter from a lender. The letter will detail how much money you can borrow, based on the lender’s assessment of your credit score and income.

“The problem is, buyers want to find the house first, and then they think they’ll work out the financing,” Jensen says. “But the problem is, the really good deals on these bank-owned, they go quick—and the buyer doesn’t necessarily have time to try to work out the financing afterward. They need to work that out first.”

Zimmerman says some first-time buyers make the mistake of assuming that the bank selling the home will also finance the mortgage as part of the deal. “Don’t expect to get financing from the bank that foreclosed on it,” she says. “That’s a totally separate transaction, and they view it that way. The people in the (bank’s) REO department are not loan officers. They are getting rid of bad assets.”

Look at comps before making an offer.
There’s no rule of thumb on what the bank’s bottom line is on price. Just as with any other real estate purchase, you have to look at the recent sales prices of comparable properties, or “comps.”

“You really have to look at the comps in today’s current market conditions and write a competitive offer based on that,” says Jensen. “Sometimes the bank prices the homes really low, and the home will have multiple offers over list price within hours.

“Sometimes it’s priced too high, and you can come in lower. A lot of times, buyers will come to me and say, ‘We want to write offers for half price.’ It just doesn’t work that way.”

Bid the higher price if homes are selling quickly.
Keep in mind that foreclosed houses generally are sold as-is. That means that you shouldn’t expect to get a discount to compensate for repairs.

Jensen says: “Let’s say the house is listed for $200,000, all the comps are $200,000, and so the client comes in and says, ‘Hey, look, I want to buy this house but I’ve got to do paint, carpet and fix some mold damage, so I want to take $15,000 off the price.’ You know what? All the other ones were in the same condition, and they sold for $200,000.”

Jensen further advises finding out how quickly comparable houses are selling. With foreclosures, a 3,500-square-foot house with a pool in a gated community might sell within days or hours, but more modest homes might sit on the market for weeks, or vice versa, depending on market conditions.

If the foreclosed homes you’re looking at are selling swiftly, “the best advice on a bank-owned property is to come in at your highest and best, unless the property has been sitting on the market forever with no activity,” Jensen says.

“If you’re going to be upset because you would have gone $5,000 more but you lost the property, just bid the higher price in the first place.”

Find tradespeople who can assess and repair damage.
Because repairs are almost inevitable with foreclosed houses, Jensen and Zimmerman recommend getting to know tradespeople who can assess and repair damage from pests, mold and leaks. Zimmerman says you should assume that the air conditioning needs to be fixed, and possibly the heating system, too.

It all sounds daunting—but at least you don’t have to wait for the owner to move out of the house.

©2018 Bankrate.com
Distributed by Tribune Content Agency, LLC

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$216,600 :: 30904 SCRIVO DR, Warren MI, 48092-4960

Property Photo

5 beds, 2 baths
Home size: 2,046 sq ft
Lot Size: 8,276 sq ft
Added: 05/23/18, Last Updated: 06/27/18
Property Type: Single Family
MLS Number: 21451970
Community: Warren (50023)
Tract: WILLIAMSBURG
Status: Sold

Northwest Warren! SPACIOUS & UPDATED 5 Bedroom Colonial! PROFESSIONALLY LANDSCAPED! Spacious Fenced Backyard (Large Deck, Gazebo & rear lined with Arborvidae!) Spacious Kitchen with Beautiful Solid Wood Cabinets, Newer Counters, Sink & Faucet, Refrig., Ceran Top Stove, Dshwshr & Blt-in Microwave (almost all replaced in ’15!) Large Formal Dining Rm, Living Rm & Spacious Family Rm with Natural FIREPLACE Full Wall Brick Hearth, Newer “Pella” Doorwall. ALL NEWER “PELLA” WINDOWS thruout, Newer Insulated Vinyl Siding, Insulated Garage Door, Hot Water Tank, Circ. Brkrs, Furnace ’10, Central Air ’13. EXCEPTIONAL LAYOUT! OAK FLOORS under All Carpet except Family Rm & 1 Bdrm) Large Master Bedroom with Private access to the Full Bath. Non-Smoking house. FINISHED BASEMENT w/ Potential for 2nd Kitchen. (the smallest bedroom would make an excellent 2nd Floor Laundry!) Large Covered Porch. SPRINKLER System (front and back)

Listed with RE/MAX First


Brought to you by Janet Hull and Thomas Bush, Real Estate One, Inc.. Call me today at 1-855-Janet-Tom, or visit my website at www.JanetandThomas.com!


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$85,000 :: 13919 FRAZHO Road, Warren MI, 48089

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5 beds, 3 baths
Home size: 2,377 sq ft
Lot Size: 10,018 sq ft
Added: 05/30/18, Last Updated: 06/26/18
Property Type: Single Family
MLS Number: 218047657
Community: Warren
Tract: LIBERTY ACRES
Status: Sold

A MUST SEE!!! LARGE 5 BEDROOM COLONIAL WITH MOTHER IN LAW SUITE OR EXTRA LIVING QUARTERS!!! 3 Nice Full Bathrooms, Fresh Paint and Carpeting, 1 Car Attached Garage, Nice Deep Lot. Offers a Large Master Bedroom with a Large Kitchen, Patio with 2 Sliding Doorwalls. Plenty of Room Inside and Outside Ideal for Entertaining and a Large Family. YOU CAN’T LOSE WITH THIS ONE. GET IN TO SEE IT WHILE ITS AVAILABLE!Multiple offers Highest and best due by noon on Monday June 4th.

Listed with Northeast Realty


Brought to you by Janet Hull and Thomas Bush, Real Estate One, Inc.. Call me today at 1-855-Janet-Tom, or visit my website at www.JanetandThomas.com!


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$153,000 :: 4636 FENWICK DR, Warren MI, 48092-3075

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3 beds, 2 baths
Home size: 1,346 sq ft
Lot Size: 7,405 sq ft
Added: 04/13/18, Last Updated: 06/25/18
Property Type: Single Family
MLS Number: 21435099
Community: Warren (50023)
Tract: MORNINGSIDE MANOR
The price of this listing was last reduced on 4/24/2018 by 3%
Status: Sold

1,364 Sq Ft Ranch with fire lit Family Room, Dining Room, Living Room and partially finished Basement for added space. Don’t forget the updated Kitchen and 3 car Garage. Hurry!

Listed with Keller Williams First Grand Blanc


Brought to you by Janet Hull and Thomas Bush, Real Estate One, Inc.. Call me today at 1-855-Janet-Tom, or visit my website at www.JanetandThomas.com!


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Analysis: The Price of a Property Ripe for Summer

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With more activities, daylight, outdoor parties and vacations, summer is a precious time of year. Do you have amenities at home that make the most of the season?

According to new realtor.com® research, features that scream “summer” can earn homeowners more profit. An outdoor shower, for example, is at a 97 percent price-per-square foot (PPSF) premium—exceedingly high, because most are on properties on the water—while a barbecue grill, associated with summertime, is at 26 percent, and a pool and/or spa is at 25 percent.

“Buyers love special features that enable them to get the most out of the summer months, and are willing to pay more for a home that has them, according to our analysis,” says Javier Vivas, director of Economic Research at realtor.com.

MORE: Is ‘Green’ at a Premium? Depends Where You Purchase

However, location matters. According to the analysis, Massachusetts, Hawaii and New Jersey contain the most listings with outdoor showers, but New York, New Jersey and South Carolina have the highest premiums for them, at 256 percent, 164 percent and 140 percent, respectively. When it comes to BBQs, Arizona, California and Utah have the most listings with them, but only Arizona and California have the highest premiums (33 percent and 23 percent, respectively). Arizona and California are also contenders for the most listings with pools, but New York has the highest premium for one, at 224 percent.

When marketing a property primed for summer, the description is key, the research shows. In Michigan—where bitter winters and lake life meet—descriptions on listings mentioning “summer days” or “summer fun” command a 36 percent premium.

For more information, please visit www.realtor.com.

Suzanne De Vita is RISMedia’s online news editor. Email her your real estate news ideas at sdevita@rismedia.com. For the latest real estate news and trends, bookmark RISMedia.com.

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$165,000 :: 28857 LUND AVE, Warren MI, 48093-7118

Property Photo

3 beds, 2 baths
Home size: 1,585 sq ft
Lot Size: 7,405 sq ft
Added: 03/20/18, Last Updated: 06/23/18
Property Type: Single Family
MLS Number: 21424850
Community: Warren (50023)
Tract: IMPERIAL MANOR
The price of this listing was last reduced on 4/2/2018 by 3%
Status: Sold

Spacious 3 Bedroom brick ranch conveniently located, walking distance to City Hall, shopping and freeway. Property is well maintained with finished basement that features a full kitchen.

Listed with Home Pride Realty


Brought to you by Janet Hull and Thomas Bush, Real Estate One, Inc.. Call me today at 1-855-Janet-Tom, or visit my website at www.JanetandThomas.com!


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Smart Homes: The Way of the Future or a Risk to Homeowners?

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Glitches of early iterations aside, AI-based technology has come a long way, and has an increasingly active presence in the lives of homeowners who are looking for convenience and savings in a pushed-for-time era. From adaptive thermostats that automatically gauge energy usage and alter temperatures for optimal savings, to smart home speakers that use sophisticated artificial intelligence to provide services and information in real-time, a smart homeowner can now cross off a variety of menial tasks from their daily to-do list without doing more than speaking a phrase out loud or clicking a button on their mobile device.

What is the true cost of this convenience? Some gadget adopters are reporting invasion of privacy, security risks, and more. For those who have not yet invested in smart home technology, these factors are largely holding them back; in fact, it is the second-biggest reason for hesitation for 17 percent of non-users, behind price (42 percent), according to a recently released report by PricewaterhouseCoopers (PwC), “Smart Home, Seamless Life: Unlocking a Culture of Convenience.” In addition, 56 percent of surveyed individuals stated they would choose encryption to protect their data when creating their own smart home.

What are these misuses of technology that could lead to privacy or security risks? These are a few of the reported instances thus far:

  1. Gadgets May Be Susceptible to Hacking
    Last August, Wired published a story about a British security researcher for MWR Labs, Mark Barnes, who was able to install malware on an Amazon Echo device, turning it into a surveillance device that silently streamed audio to his own server. While newer models cannot be jailbroken this way, Amazon has not released any software to fix the issue with older units.

For the typical owner, this may not seem like a significant violation; however, this could lead to another type of home theft in which fraudsters break into homes looking to steal identifying information via smart home gadgets, leaving little to no evidence of their break-in behind. While Barnes installed code for the specific purpose of audio streaming, he clarified that the installation of malware could serve other uses, such as stealing access to a homeowner’s Amazon account, installing ransomware or attacking parts of the network.

  1. Smart Technology Could Lead to Location-Based Tracking
    Earlier this month, security investigator Brian Krebs reported on a privacy vulnerability for both Google Home and Chromecast—found by Craig Young, a researcher with security firm Tripwire—that leaks accurate location information about its users.

According to Young, attackers can use these Google devices to send a link (which could be anything from a tweet to an advertisement) to the connected user; if the link is clicked and the page left opened for about a minute, the attacker is able to obtain a location.

“The difference between this and a basic IP geolocation is the level of precision,” Young said in the article. “For example, if I geo-locate my IP address right now, I get a location that is roughly two miles from my current location at work. For my home internet connection, the IP geo-location is only accurate to about three miles. With my attack demo, however, I’ve been consistently getting locations within about 10 meters [32 feet] of the device.”

Google initially told Young they would not be fixing the problem; however, after going to the press about the issue, Young reports that Google will be releasing an update in mid-July to address the privacy leak for both devices.

  1. Glitches Could Lead to Invasion of Privacy
    According to local news stations in Portland, Ore., a resident (reportedly named Danielle) received a disturbing phone call from one of her husband’s employers telling her to shut off her smart home devices. After using Amazon devices throughout her home to control temperature, lighting and security, Danielle was made aware that a private conversation was accidentally recorded by Amazon’s artificial intelligence system, Alexa, and was sent to a number on the family’s contact list.

Amazon has since reported that the Echo speaker picked up words in Danielle’s background conversations that it interpreted as “wake words” for recording and sending audio to a contact; however, an article published by website The Information last July states that Amazon was considering obtaining recorded conversations and sending transcripts to developers so they can build more responsive software, making it unclear if these devices automatically record audio without waiting for “wake words.”

These Vulnerabilities Could Impact Real Estate
Smart homes are increasing across the country. According to Statista, a statistics website, the estimated value of the North American smart home market will be $27 billion by 2021.

Of course, the vulnerabilities that have cropped up for some users could have an impact on the selling process. For example, some sellers have already begun using their security systems as a way to listen in on prospective buyers or watch them as they visit the listed home, regardless of whether local laws prohibit these recording practices.

Additionally, if homeowners have devices such as Google Home or Amazon Echo, but do not have security cameras, how can they be sure that visiting buyers are not accessing sensitive information through these speakers? While agents always play a role in adding a measure of security by being present during showings, fraudulent activity that is internet-based only, such as obtaining online data through links, will be difficult to identify.

Liz Dominguez is RISMedia’s associate content editor. Email her your real estate news ideas at ldominguez@rismedia.com. For the latest real estate news and trends, bookmark RISMedia.com.

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Mortgage Payments Require Largest Share of Income Since 2009

Rising mortgage rates chip away at relatively affordable monthly housing costs Americans have enjoyed for a decade Continue Reading →

Homes with Tuxedo Kitchen Cabinets and Black Front Doors Can Sell Up to $6,000 More than Expected

For-sale listings with neutral wall colors accented by dark pops of color sell for more money, according to Zillow analysis; homes with red or brown wall colors can sell for less than expected Continue Reading →