Mortgages
Investigation reveals banks illegally denied loan modifications
Amy Pyle
Feb 5th 2010 at 8:00AM
Filed under: Banks, Debt, Real Estate, Mortgages, Refinancing
An investigation by the nonprofit journalism operation, ProPublica, raises intriguing questions about reasons desperate homeowners are being turned away for the very government program aimed at helping them.Some of the problems ProPublica uncovered echo complaints WalletPop heard when we wrote about troubles with the federal Home Affordable Modification Program last year: trial modifications being extended just as they are completed, and loans being denied because an income decline is considered temporary.
That temporary hardship, the focus of ProPublica's latest story, was not intended to be legitimate grounds for denial, as was clearly explained by the Treasury Department in a December memo. Now, JPMorgan Chase -- which was involved in all of the cases the investigation uncovered -- has acknowledged its error and encouraged anyone denied for that reason to reapply. A spokeswoman told ProPublica that the company "adapts as quickly as possible" to the Treasury guideline missives.
As of the end of 2009, the government reported, more than 900,000 trial modifications had been started, but only 66,465 had transitioned into permanent breaks for the borrowers. The report also showed JP Morgan Chase was second only to Bank of America as a participant in the federal HAMP program.
A smile and a strategy may help get that loan modification
Charles Feldman
Feb 3rd 2010 at 2:00PM
Filed under: Real Estate, Personal Loans, Mortgages, Refinancing
Come this June, as WalletPop has reported, new government rules take effect that are designed to make it easier for distressed homeowners to get not only that often-elusive, three-month trial mortgage loan modification, but also the much more sought after (and relatively seldom gotten) permanent mortgage modification.
But new rules and regulations, while helpful, are only part of the picture. As with many other things in life, having the right attitude and a firm plan in place before paying a visit to your questionably friendly neighborhood loan officer may greatly enhance your chances of getting that loan modification.
Bankers not as optimistic about the economy as Obama
Charles Feldman
Feb 3rd 2010 at 9:30AM
Filed under: Banks, Real Estate, Mortgages
Although the President claimed in his State of the Union address that the worst of the economic storm has passed us by, he apparently didn't consult with bankers who answered the January survey of senior loan officers conducted by the Federal Reserve.Had Mr. Obama done so, he'd have found out that, in fact, when it comes to mortgage loans, bankers are not exactly upbeat about the near term future.
In fact, according to the survey, credit standards are still being tightened as bankers expect delinquencies to continue to rise.
For prime real estate loans, 17 % of banks say they tightened their standards, while 30% of banks answered the same way about non-traditional loans.
Job loss mortgage insurance giving homebuyers security
Lita Epstein
Feb 2nd 2010 at 1:30PM
Filed under: Insurance, Real Estate, Mortgages
In these uncertain times potential homebuyers continue to sit on the sidelines because they are concerned that a job loss could kill their dreams to own a home. Innovative job loss mortgage insurance is being offered through mortgage lenders, real estate agents, new-home builders and state and local housing agencies. In many cases this protection is being offered free to the homebuyer as part of their home purchase.
One real estate agent even put out a press release about the "Worry Free" Mortgage Protection."
"The ability to provide home buyers a viable solution to the uncertainty associated with purchasing a home eliminates one of the major obstacles preventing buyers from taking advantage of once in a lifetime purchasing opportunities," Lance Mohr, a Tampa broker, stated. "Interest rates remain near historic lows even as the cost of buying a new or existing home continue to drop; combined with federal tax incentives this is literally one of the best buying opportunities presented in decades. Unfortunately, the fear of job loss and economic uncertainty has prevented many would-be buyers from acting on their desire to purchase a home."
Real estate tax tips for 2010
Amy Pyle
Feb 2nd 2010 at 8:00AM
Filed under: Real Estate, Mortgages, Tax - Credit, Tax - Deduction, Refinancing
The real estate downturn that dominated 2009 leaves many on unfamiliar ground at tax time. Where better to look for advice than in suburban Los Angeles, where property values took a particularly vicious dive. There, Woodland Hills investment adviser Mark Kennedy shared his tips with WalletPop:On Foreclosure: "Homeowners here are really getting screwed. If they do what's called a deed in lieu of foreclosure, their credit gets slammed, just like a foreclosure, and then, even if the bank forgives you, the IRS does not. Say you borrowed $500,000 and the house now is only worth $300,000. You would get a deficiency 1099 from the IRS for that difference. Doesn't make sense, but that's the rule."
Mortgage rates expected to rise as government support phases out
Charles Feldman
Feb 1st 2010 at 8:00AM
Filed under: Banks, Real Estate, Mortgages
If you are fence sitting about whether to buy that house, you may not want to wait too much longer: If government officials can be believed, the more than year-long federal support of mortgages, which brought rates to post World War II lows, is slated to end within the next couple of months.Should this happen, mortgage rates are expected to climb. By how much, no one seems certain. Though fears are already being expressed by some, that any hefty increase in the 30-year fixed rate mortgage could cut any developing real estate market recovery off at the knees.
But forget the macro implications and let's keep to the micro ones: that would be you.
New rules will speed up mortgage modifications
Charles Feldman
Jan 29th 2010 at 1:00PM
Filed under: Home, Real Estate, Mortgages
Mortgage modifications have turned out to be far more difficult than the Obama administration apparently initially thought they'd be. Many homeowners complain they can't get lenders to award them permanent modifications after a required three-month trial. Servicers often blame the borrowers for submitting incomplete applications and other documents. And there goes any hope of a permanent mortgage modification.
Until now! (Or this June, to be exact).
Latest new home sales plunge shouldn't surprise the 'experts'
Charles Feldman
Jan 27th 2010 at 1:30PM
Filed under: Home, Real Estate, Recession, Mortgages
I am always somewhat amused when I read how so-called "experts" are "surprised" or "shocked" or "baffled" (lots of other expressions pop up when dealing with the economy in particular) when economic news turns out not to be what they had anticipated...even though it would seem pretty obvious to anyone with a keen observational eye that there is nothing really surprising by the latest set of statistics at all.
Take the just released government report on new home sales. They have hit a nine-month low. Apparently some analysts that had been "surveyed by Briefing.com had expected December sales of new home to hit an annual rate of 366,000." Instead, the figure was actually 342,000 last month, down 7.6 % from the previous month.
Tips on buying a bank-owned home
Charles Feldman
Jan 26th 2010 at 11:00AM
Filed under: Banks, Home, Real Estate, Mortgages
With more and more "distressed" (foreclosed) homes up for sale, a bank-owned home may be the way to go if you are considering buying a house.
But experts say buying from a bank is very different than buying a home from an individual. With that in mind, here are some expert tips on how to buy a bank-owned home.
Home for a downsized economy unveiled
Amy Pyle
Jan 19th 2010 at 3:00PM
Filed under: Home, Real Estate, Recession, Mortgages
The notice on the Web site for the International Builders Show, being held in Las Vegas this week, pretty much says it all:Into that softer market comes the latest dwelling from minimalist designer Marianne Cusato dubbed, appropriately it seems, "The New Economy Home." Unveiled at the show Tuesday morning with a virtual tour, the three-bedroom, three-bath home is 1,800 square feet -- including an "adaptable" room intended to flex over time, from a family room to an office, a fourth bedroom or a separate apartment.
Refinancing: No time like now, but keep your eyes wide open
Amy Pyle
Jan 18th 2010 at 3:00PM
Filed under: Debt, Real Estate, Mortgages, Refinancing
The landscape of refinancing has changed dramatically in recent months, but the reason for doing it remains largely the same. "It was about the dollars," says Owen Metz, 26, of Plymouth, Minn., who dropped his monthly payments by $150 when he refinanced earlier this month. "Anytime I can save money now -- it's almost a no-brainer."The number of Americans refinancing their homes has been dropping recently. The Mortgage Bankers Association reports a 30% year-over-year decrease Christmas week, and a slight decrease the next week, after interest rates inched past 5% and tougher loan qualification measures took effect.
But refinancing is still an attractive option for many, and loan brokerages and analysts agree on a strategy: Move quickly, but cautiously.
"2009 was a better time, but 2010 is still a good time to refi those vintage 2007 and 2008 rates over 6%," says Jay Dacey, the Minnesota mortgage broker who handled Metz's refinance.
Refinancing in an uncertain era
As the recession eases, and the U.S. gradually stops propping up the mortgage-backed securities market, interest rates may rise from last year's bargains. Last week, Boston Federal Reserve President Eric Rosengren predicted rates could increase three-quarters of a point as early as this spring.
Refinancing also may offer a welcome antidote to homeowners suffering symptoms of a recession hangover: debt, job insecurity, or short-term adjustable-rate mortgages about to reset to higher rates.
People pay car loans and credit cards before mortgages
Lita Epstein
Jan 18th 2010 at 10:00AM
Filed under: Credit, Debt, Credit Cards, Mortgages
While people used to always pay their mortgage first before other bills, priorities have definitely changed for some. Maintaining car payments appears to be the first priority, with credit cards second and mortgages last. That's the results of the third quarter trend data from TransUnion. The 60-day delinquency national average for auto loans was 0.81%. Credit cards national 90-day delinquency average was just a bit higher at 1.10%. Mortgages national 60-day delinquency rate was six times higher at 6.25%F.J. Guarrera, VP of Sales Strategy/Thought Leadership for TransUnion concluded about the mortgage numbers: "Delinquency rates are rising and expected to peak at record levels. Until the housing market can consistently demonstrate several months of home value appreciation and the unemployment rate improves, mortgage delinquencies will likely continue to rise."
The people of North Dakota are the most reliable payers. Their delinquencies rates were just 0.35% on auto loans, 0.66% on credit cards and 1.74% on mortgages. So even the most reliable payers are putting autos first, credit cards second and mortgages last on the priority list.
The hardest hit state for delinquencies was Nevada. It's auto loan delinquency rate was 1.16%, it's credit card delinquency rate was 1.98% and its mortgage delinquency rate was 14.53%. Florida residents were next in line for the worst records with a mortgage delinquency rate of 13.34%, but their auto loan defaults were just 0.99% and their credit card delinquencies were just 1.47%
Record 2009 foreclosure rate is mixed bag of news
Charles Feldman
Jan 14th 2010 at 12:00PM
Filed under: Real Estate, Recession, Investing, Mortgages
There are two ways of looking at the foreclosure news I'm about to tell you: One is that it is devastating! Proof that our economy may be working better now for Chase and Bank of America and some other "too big to fail" type institutions, but not so for the vast majority of the rest of us. The other way to look at the news I am about to tell you is, for potential home buyers, the year ahead will be a virtual flowing fountain of bargains and opportunities.
Are home prices really less expensive? Some think not.
Charles Feldman
Jan 7th 2010 at 1:00PM
Filed under: Home, Real Estate, Recession, Mortgages
At first look, it would seem pretty hard to argue that home prices are far less expensive today than they were a few short years ago. Just about anywhere in the U.S. you look, you are likely to find home prices way down from a year ago with little sign of any robust recovery anytime soon.
Increased "Section 202" funding good news for senior citizen housing
Charles Feldman
Jan 3rd 2010 at 5:00PM
Filed under: Borrowing, Budgets, Mortgages
Happy New Year, senior citizens! 2010 should be a good year for you, thanks to an increase in funding for what is known as the Section 202 program. For the first time in six years, Congress approved a hike in the Section 202 program, which takes effect with the new year. It is a $60 million increase in fiscal 2010.
The Section 202 program, reports the Associated Press, "provides grants and rental help through nonprofit sponsors of low-income senior housing." Under the Section 202 program, a person usually pays no more than about 30 percent of their income on rent, according to the AP.
