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Niicss
Joined: 03 Oct 2005
Posts: 2617
Location: New Jersey
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 Posted: Fri May 09, 2008 4:31 am Post subject: |
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Wow this is a Very good news Larry 
Especially for the borrowers who are facing difficulties because of the rate adjustment. The best thing of this bill is that principal balance of the mortgage can be reduced if the property value less than the amount the borrower owe to the bank.
Hope this bill will help the borrowers and the economy get out from the vicious circle of credit crunch.
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cliff
Joined: 05 May 2008
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Posts: 328
Location: Houston
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| Posted: Fri May 09, 2008 6:20 am Post subject: |
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Great Bill! However, it will face some head winds as it moves through the senate. For all you mortgage people $300 billion will be great for business in this new nitch market. Great post larry!
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Jessica
Joined: 08 Jun 2004
Community Mentor
Posts: 814
Location: OHIO
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| Posted: Sat May 10, 2008 3:32 am Post subject: |
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So, we have yet another bill for distressed homeowners. And if I am to believe statistics, it's going to help only 8.6% of the millions of borrowers in foreclosure. Anyway, what it states is, anyone having a sub-prime loan or an ARM and demonstrating the ability to pay off a refinance loan will be able to reduce their principal loan amount so that they can at least pay off their loans.
The bill as they say is likely to provide relief to 1.5-2 million people in the next 5 years. But with 1.5 million families already facing foreclosure and another 2.8 million likely to go through it, I doubt as to how much this bill can help financially stressed-out borrowers.
Regards,
Jessica.
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jenkin7
Joined: 04 Jun 2007
Posts: 3421
Location: Hawaii
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| Posted: Sat May 10, 2008 4:35 am Post subject: |
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Hi Larry.
I doubt whether it is a good news or not because Mr. President would veto this bill and rightly so because Most people who are facing the foreclosure are irresponsible borrowers who have taken the ARM without anglicizing their situation properly and even do not bother to consult with the bank when they faces problem with their payments. So those irresponsible borrowers should face the music. |
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cliff
Joined: 05 May 2008
Community Experts
Posts: 328
Location: Houston
75.44 Dollars($)
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| Posted: Sat May 10, 2008 12:02 pm Post subject: |
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Of course as always with any government action it is always going to be too little to late for the majority of people it is trying to help. So what should you do as a mortgage professional? You have to understand the economic impact and adapt to utilize it to your advantage in helping your current clients. As an economist, here are my thoughts on how it will affect mortgage markets and ultimately the mortgage industry.
Ok here we go. When looking at government intervention (i.e. pumping money into any market(s)) you have to look out at least six months to a year in the future. This is because it takes markets that long to respond to economic stimulus, and no matter what you think about H.R. 5830 http://www.govtrack.us/data/us/bills.text/110/h/h5830.pdf its affect will be an economic stimulus to the economy.
So what does this mean to mortgage professionals? This means over the next year you need to focus on your potential refinance clients. So the same people who did cash out refies will be back in season again! Jessica is right; the majority of people who need this will not be the people who utilize it. It will be the people who refinanced during the lending boom who are not currently in trouble but would like to take advantage of the new FHA program. So you want to start today to let them know that once this bill passes they will be able to refinance into a mortgage that is 90% of the appraised value of their home.
Simply put, we are now headed for another refinance boom and, just like the last one, it will all start with government policy!
Side note on politics: no worries even if this bill does not pass, some type of bill similar to it will. The political pressure is up and constituents are insisting on their representatives to pass some type of bill to counter act the terrible mess we’re in.
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Cliff Pape
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| Posted: Sat May 10, 2008 2:39 pm Post subject: |
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several good posts and I agree that it may spike another refinance boom...
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jenkin7
Joined: 04 Jun 2007
Posts: 3421
Location: Hawaii
512.47 Dollars($)
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| Posted: Thu May 22, 2008 4:24 am Post subject: |
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| To pull the nation from the housing problem a key Senate committee has offered a new mortgage bail out plan. Instead of the taxpayers government sponsored Fannie Mae and Freddie Mac will provide home loan rescue for up to 500,000 delinquent homeowners. The Bill will tighten the regulations of Fannie Mae and Freddie Mac which will finance a new affordable housing fund to pay the foreclosure prevention fund. This housing bill is yet to be final. The law makers are on a week long break. After their return the Bill will have to go through a continuous and complicated round of House-Senate negotiations and then it will be presented to President Bush. |
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cliff
Joined: 05 May 2008
Community Experts
Posts: 328
Location: Houston
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| Posted: Thu May 22, 2008 6:47 pm Post subject: |
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Right I saw that two and the president is already saying that he likes this bill more than the house bill. Also, did you notice the number is still the same $300 billion. In addition, there are alot of voters out there who lost thier jobs and homes and they are bothering thier local represenatives to get this done before the November election or else.
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Cliff Pape
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sara
Joined: 05 Jul 2006
Moderator
Posts: 1679
Location: New Brunswick, New Jersey
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| Posted: Wed Jul 30, 2008 5:13 am Post subject: |
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The Congress has approved the Hope for Homeowners Act under which, those who qualify can replace their old mortgages into 30 year fixed rate loans for up to 90% of the current home value.
However, whether a loan will be replaced by a 30 year FRM will depend upon the lender or the bank involved. After all, the bank should be prepared to face the loss on the existing loans in place of a foreclosure which is often costly.
In order to qualify for this rescue plan, a borrower needs to satisfy the criteria as given below:
- One must have spent 31% of his monthly income on mortgage payment as of march 1, 2008
- The loan must have been offered no later than Jan1, 2008
- The loan must be secured by the borrower's primary residence
- The borrower's income must have been verified
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roysky
Joined: 13 Nov 2008
Posts: 2
1.90 Dollars($)
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| Posted: Thu Nov 13, 2008 6:15 pm Post subject: Not very helpful |
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| I tried to qualify but couldn't. I was told my credit score is not good enough and the lenders/banks still require certain credit score. They have the "CHOICE" whether to participate or not. They are not mandated by the government. So most of them decline anyway. Good for the ones who qualify. Another things is if you sell your house within a year, the goverment gets all the equity benefits then it goes down and down until after five years, you are still sharing 50% of the profit with the government. |
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