Why are government programs failing to mitigate the nation’s foreclosure problem?
And why haven’t more Lenders voluntarily reduced mortgage principals?
The answer to both of these questions has to do with the high number of mortgage loans that were securitized.
When a mortgage is in a security, it’s owned by groups of investors. Even though a [...]
The expanded plan pays lenders to reduce any unemployed homeowner’s payment to as low as 31% of his/her income for up to six months. This sounds like a resurrection of what used to be known as a Forbearance Agreement.
Moreover, if a homeowner has an over-leveraged house and stays current on his/her monthly payments, the new [...]
Since 1st Quarter 2009 and up to now, Federal Homeowner Assistance Programs that respond to the bursting of the housing bubble were designed to keep homeowners in their houses via loan modifications.
These Federal Programs failed miserably, because lenders refuse to do loan mods on overleveraged houses and most mortgages are bundled into Mortgage Backed Securities which seriously limit [...]
Tami Luhby at CNNMoney.com wrote a report today on the roll-out status of President Obama’s two-part (Affordable Refinance or Loan Modification) $75b Foreclosure Prevention Plan announced on February 18, 2009.
Go here to read it:
http://money.cnn.com/2009/03/19/news/economy/Obama_foreclosure_plan/index.htm?source=yahoo_quote
This report also provided a website that distressed homeowners can visit to determine whether or not they qualify for assistance under the Plan. Here it is:
http://makinghomeaffordable.gov/
I’ve been intermittently watching today’s TARP Accountability hearings held by the House Financial Services Committee.
Executives from eight financial institutions that received TARP funds are being grilled about how they spent the public money that was given to them.
Three of the eight executives (Citi, Wells Fargo, and Bank of America) just verbally agreed to a 3-week moratorium on owner-occupied home foreclosures. [...]
The House of Representatives will begin overhauling the Hope for Homeowners Program the first week of February.
This program was launched in the Summer of 2008 and was meant to help approximately 400k homeowenrs refinance. To date, however, the program has only received 450 applications with 25 closed loans. A poor testament to the program’s efficacy.
The House will attempt [...]
In an effort to stem foreclosures, the Fed announced today that it may come to the aid of some troubled borrowers by requiring loan servicers to modify Fed-owned and Fed-controlled mortgages.
Specifically, The Fed will put pressure on 1) loan servicers of mortgages that the Fed wholly owns and 2) loan servicers of mortgages that the Fed partially owns (because the mortgages are part of a MBS or CDO).
The Fed can do this [...]
Here is a link to an Associated Press article that offers tips for renters when the landlord faces foreclosure:
http://www.cnbc.com/id/28392662/
So many renters of homes find themselves evicted or in limbo when the house they rent goes into foreclosure through no fault of their own.
Fannie Mae is in the process of devising a new national policy that applies to non-owner-occupied homes. It will halt evictions and allow tenants to remain in their rental homes even though the properties they [...]
Today, a unified effort on the part of the Federal Housing Financing Agency (FHFA), Fannie Mae and Freddie Mac, and the 27 loan servicers of the Hope Now program announced a new, streamlined plan to speed-up loan modifications for distressed homeowners.
The plan will help qualified homeowner’s (with Fannie Mae and Freddie Mac loans) facing foreclosure [...]