What is happening today in mortgage lending:
It's Done, the headlines are starting to appear
Bush Signs Measure for Homeowners, Fannie, Freddie (Update2)
http://www.bloomberg.com/apps/news?pid=20601103&sid=am2yQYThqmxQ&refer=us
Bush Signs Massive Housing Bill
http://blogs.abcnews.com/politicalradar/2008/07/bush-signs-mass.html
Tips For Homeowners On Understanding Sweeping Mortgage Bill
http://www.courant.com/business/hc-mortgage0729.artjul29,0,5538506.story
Wednesday, July 30, 2008
Tuesday, July 29, 2008
Mortgage News
What is happening today in mortgage lending: We are definitely moving to new territory:
Banks Act to Aid Mortgage Lending
http://online.wsj.com/article/SB121727042664390535.html?mod=residential_real_estate
Tips For Homeowners On Understanding Sweeping Mortgage Bill
http://www.courant.com/business/hc-mortgage0729.artjul29,0,5538506.story
Banks Act to Aid Mortgage Lending
http://online.wsj.com/article/SB121727042664390535.html?mod=residential_real_estate
Tips For Homeowners On Understanding Sweeping Mortgage Bill
http://www.courant.com/business/hc-mortgage0729.artjul29,0,5538506.story
Monday, July 28, 2008
Mortgage News
What is happening today in mortgage lending:
It was a busy weekend with the Senate working to approve the biggest bill in a decade. I sent out a speical email yesterday giving you the most recent update on this bill. President Bush is expected to sign this some time this week. It wasn't all rosy but it will be interesting to see how it all plays out.
Housing Bill Relies on Banks To Take Loan Losses http://online.wsj.com/article/SB121719179401688061.html?mod=hpp_us_whats_news
Mortgage insurers tightening rules http://www.mercurynews.com/news/ci_10019672
It was a busy weekend with the Senate working to approve the biggest bill in a decade. I sent out a speical email yesterday giving you the most recent update on this bill. President Bush is expected to sign this some time this week. It wasn't all rosy but it will be interesting to see how it all plays out.
Housing Bill Relies on Banks To Take Loan Losses http://online.wsj.com/article/SB121719179401688061.html?mod=hpp_us_whats_news
Mortgage insurers tightening rules http://www.mercurynews.com/news/ci_10019672
Sunday, July 27, 2008
Mortgage News
What is happening today in mortgage lending:
The bill congress just past is expected to be signed by the president in the next few day. Some of the areas I was most interested ended up to be approved by the Senate as:
Bar down-payment assistance for FHA loans. The bill eliminates a program that has allowed sellers to provide down payment assistance
The bill would also increase to 3.5% from 3% the down payment requirement for borrowers getting FHA loans.
Permanently increase "conforming loan" limits. The bill would permanently increase the cap on the size of mortgages guaranteed by Fannie and Freddie to a maximum of $625,500 from $417,000.
The FHA maximum loan limits for high-cost areas would also increase to $625,500. Higher loan limits will make it easier for borrowers to get mortgages, because they're more likely to be traded if they are considered conforming.
Senate passes landmark housing bill http://money.cnn.com/2008/07/26/news/economy/housing_bill_Senate/?postversion=2008072614
How housing rescue bill can help you-CNN
The Senate on Saturday passed a $300 billion housing rescue bill aimed at helping troubled homeowners avoid foreclosure and supporting mortgage giants Fannie Mae and Freddie Mac.
President Bush is likely to sign the bill into law within days. After the law kicks in on Oct. 1, thousands of at-risk borrowers will be able to refinance their unaffordable old mortgages into new low-cost fixed-rate loans insured by the Federal Housing Administration (FHA).
The Congressional Budget Office estimates that 400,000 borrowers with $68 billion in loans may benefit from the program - but the bill allows for as many as 1 million or 2 million borrowers to participate in the program.
Here's what homeowners need to know.
Who's eligible?
Qualified borrowers must live in their homes and have loans that were issued between January 2005 and June 2007. Additionally, they must be spending at least 31% of their gross monthly income on mortgage debt to be eligible for the program.
They can be up to date on their existing mortgage or in default, but either way borrowers must prove that they will not be able to keep paying their existing mortgage - and attest that they are not deliberately defaulting just to obtain lower payments.
Before homeowners can get FHA-backed mortgages, they must first retire any other debt on the home, such as a home equity loan or line of credit. Borrowers are not permitted to take out another home equity loan for at least five years, unless it's to pay for necessary upkeep on the home.
To get a new home equity loan, borrowers will need approval from the FHA, and total debt cannot exceed 95% of the home's appraised value at the time.
How can I apply?
Borrowers can contact their current mortgage servicer or go directly to an FHA-approved lender for help. These lenders can be found on the Web site of the Department of Housing and Urban Development.
How does the refinancing process work?
This is a voluntary program, so lenders holding the original mortgage have to agree to rework a given loan before things can get started. The bill requires lenders to make major concessions, writing down the value of the loan to 90% of the home's current value. In areas where prices have plummeted by as much as 20%, that will mean a substantial loss for the lender.
But lenders won't sign off on a workout unless they think that they'll lose less money on that than they would by allowing a home to go through the costly foreclosure process.
Each loan will have to be underwritten by an FHA lender on a case-by-case basis. That means the banks will do a new appraisal to determine the home's current value, as well as examine and verify income statements, bank accounts, job histories and credit scores.
Based on that new appraised home value, the FHA lender must determine how much the original lender has to reduce the original mortgage, so that it will reflect 90% of the home's market value.
If the original lender agrees to the writedown, the new lender buys the old loan and takes over the reworked mortgage.
As part of the deal, the old lender writes off any fees and penalties on the original mortgage, including prepayment penalties, and accepts the proceeds from the new loan on a paid-in-full basis. Additionally, it pays the FHA an up-front premium equal to 3% of the mortgage principal.
What does it cost?
There should be little up-front costs for borrowers to bear. Loan origination fees will vary by lender, but these can usually be paid by the borrower over the life of the loan in the form of a slightly higher interest rate.
However, the refinanced loans do come with many strings. For one thing, borrowers are responsible for paying an insurance premium to the FHA guaranteeing the loan, which will be 1.5% of the principal annually.
Borrowers also agree to share any profits from future home-price appreciation with the FHA. To do that, they'll pay a "3% exit fee" of the mortgage principal to the FHA when they resell or refinance.
Plus, they'll agree to pay the FHA 100% of any profits they realize from higher home prices if they sell or refinance within a year. So if the original loan principal is $200,000 and the home sells for $250,000, the borrower will owe the FHA $50,000, minus costs.
After a year, borrowers will share 90% of the profits with the FHA. The percentage keeps dropping in 10% increments to 50% after the fifth year, where it stays.
What will I save?
Savings depend on what borrowers are paying for their present loan and where they live, but for most people it will be substantial, even after factoring in the FHA fees.
In areas that have sustained huge price drops, such as Sacramento, Calif., where prices have fallen by about 30% over the past year, some loans might be reduced by more than 40%.
Additionally, the FHA loans carry reasonable interest rates, which are fixed for the life of the loan, as opposed to a subprime adjustable-rate mortgage that can jump higher every six months.
The bill congress just past is expected to be signed by the president in the next few day. Some of the areas I was most interested ended up to be approved by the Senate as:
Bar down-payment assistance for FHA loans. The bill eliminates a program that has allowed sellers to provide down payment assistance
The bill would also increase to 3.5% from 3% the down payment requirement for borrowers getting FHA loans.
Permanently increase "conforming loan" limits. The bill would permanently increase the cap on the size of mortgages guaranteed by Fannie and Freddie to a maximum of $625,500 from $417,000.
The FHA maximum loan limits for high-cost areas would also increase to $625,500. Higher loan limits will make it easier for borrowers to get mortgages, because they're more likely to be traded if they are considered conforming.
Senate passes landmark housing bill http://money.cnn.com/2008/07/26/news/economy/housing_bill_Senate/?postversion=2008072614
How housing rescue bill can help you-CNN
The Senate on Saturday passed a $300 billion housing rescue bill aimed at helping troubled homeowners avoid foreclosure and supporting mortgage giants Fannie Mae and Freddie Mac.
President Bush is likely to sign the bill into law within days. After the law kicks in on Oct. 1, thousands of at-risk borrowers will be able to refinance their unaffordable old mortgages into new low-cost fixed-rate loans insured by the Federal Housing Administration (FHA).
The Congressional Budget Office estimates that 400,000 borrowers with $68 billion in loans may benefit from the program - but the bill allows for as many as 1 million or 2 million borrowers to participate in the program.
Here's what homeowners need to know.
Who's eligible?
Qualified borrowers must live in their homes and have loans that were issued between January 2005 and June 2007. Additionally, they must be spending at least 31% of their gross monthly income on mortgage debt to be eligible for the program.
They can be up to date on their existing mortgage or in default, but either way borrowers must prove that they will not be able to keep paying their existing mortgage - and attest that they are not deliberately defaulting just to obtain lower payments.
Before homeowners can get FHA-backed mortgages, they must first retire any other debt on the home, such as a home equity loan or line of credit. Borrowers are not permitted to take out another home equity loan for at least five years, unless it's to pay for necessary upkeep on the home.
To get a new home equity loan, borrowers will need approval from the FHA, and total debt cannot exceed 95% of the home's appraised value at the time.
How can I apply?
Borrowers can contact their current mortgage servicer or go directly to an FHA-approved lender for help. These lenders can be found on the Web site of the Department of Housing and Urban Development.
How does the refinancing process work?
This is a voluntary program, so lenders holding the original mortgage have to agree to rework a given loan before things can get started. The bill requires lenders to make major concessions, writing down the value of the loan to 90% of the home's current value. In areas where prices have plummeted by as much as 20%, that will mean a substantial loss for the lender.
But lenders won't sign off on a workout unless they think that they'll lose less money on that than they would by allowing a home to go through the costly foreclosure process.
Each loan will have to be underwritten by an FHA lender on a case-by-case basis. That means the banks will do a new appraisal to determine the home's current value, as well as examine and verify income statements, bank accounts, job histories and credit scores.
Based on that new appraised home value, the FHA lender must determine how much the original lender has to reduce the original mortgage, so that it will reflect 90% of the home's market value.
If the original lender agrees to the writedown, the new lender buys the old loan and takes over the reworked mortgage.
As part of the deal, the old lender writes off any fees and penalties on the original mortgage, including prepayment penalties, and accepts the proceeds from the new loan on a paid-in-full basis. Additionally, it pays the FHA an up-front premium equal to 3% of the mortgage principal.
What does it cost?
There should be little up-front costs for borrowers to bear. Loan origination fees will vary by lender, but these can usually be paid by the borrower over the life of the loan in the form of a slightly higher interest rate.
However, the refinanced loans do come with many strings. For one thing, borrowers are responsible for paying an insurance premium to the FHA guaranteeing the loan, which will be 1.5% of the principal annually.
Borrowers also agree to share any profits from future home-price appreciation with the FHA. To do that, they'll pay a "3% exit fee" of the mortgage principal to the FHA when they resell or refinance.
Plus, they'll agree to pay the FHA 100% of any profits they realize from higher home prices if they sell or refinance within a year. So if the original loan principal is $200,000 and the home sells for $250,000, the borrower will owe the FHA $50,000, minus costs.
After a year, borrowers will share 90% of the profits with the FHA. The percentage keeps dropping in 10% increments to 50% after the fifth year, where it stays.
What will I save?
Savings depend on what borrowers are paying for their present loan and where they live, but for most people it will be substantial, even after factoring in the FHA fees.
In areas that have sustained huge price drops, such as Sacramento, Calif., where prices have fallen by about 30% over the past year, some loans might be reduced by more than 40%.
Additionally, the FHA loans carry reasonable interest rates, which are fixed for the life of the loan, as opposed to a subprime adjustable-rate mortgage that can jump higher every six months.
Saturday, July 26, 2008
Mortgage News
What is happening today in mortgage lending: This will take a while to digest.
Senate passes housing bill http://www.axcessnews.com/index.php/articles/show/id/16490
Landmark mortgage bill clears Congress
http://www.politico.com/news/stories/0708/12074.html
Senate passes housing bill http://www.axcessnews.com/index.php/articles/show/id/16490
Landmark mortgage bill clears Congress
http://www.politico.com/news/stories/0708/12074.html
Thursday, July 24, 2008
Mortgage News
House Passes "The Most Important Housing Bill in a Generation"http://originatortimes.com/content/templates/standard.aspx?articleid=3355&zoneid=1
Treasury's Paulson Says it Was Easy to Recommend President Sign Housing Bill
http://www.economicnews.ca/cepnews/wire/article/102001
Treasury's Paulson Says it Was Easy to Recommend President Sign Housing Bill
http://www.economicnews.ca/cepnews/wire/article/102001
Wednesday, July 23, 2008
Mortgage News
DPA's on the chopping block again. Keep the down payment assistance program
http://www.ajc.com/opinion/content/opinion/stories/2008/07/23/mortgaged.html
http://www.ajc.com/opinion/content/opinion/stories/2008/07/23/mortgaged.html
Helping the Consumer
How many times have you had to explain to your client what a FICO score is and why it is important? This article has some good information that is very consumer friendly.
Credit dos and don’ts before buying a home http://www.dailyprogress.com/cdp/business/real_estate/article/credit_dos_and_donts_before_buying_a_home/25117/
Credit dos and don’ts before buying a home http://www.dailyprogress.com/cdp/business/real_estate/article/credit_dos_and_donts_before_buying_a_home/25117/
Tuesday, July 22, 2008
Helping Your Borrower's
Clean up credit score to land a sweet mortgage rate A good article to share with your consumers
http://www.usatoday.com/money/perfi/columnist/block/2008-07-21-home-buyers-credit-report_N.htm
http://www.usatoday.com/money/perfi/columnist/block/2008-07-21-home-buyers-credit-report_N.htm
Monday, July 21, 2008
Mortgage News
Freddie Mac May Slow Purchases of Mortgages, Bonds (Update3)Freddie Mac, the second-largest U.S. mortgage-finance company, may cut purchases of home loans from banks and bonds backed by housing debt to shore up its capital amid record delinquencies http://www.bloomberg.com/apps/news?pid=20601103&sid=aqZzF4461u0Q&refer=news
Tuesday, July 15, 2008
Mortgage News July 15, 2008
Mortgage News
Radian
Rate and Guideline Changes Effective July 14, 2008
Radian’s continued in-depth surveillance and review of mortgage market conditions and
loan performance lead us to conclude that additional changes to our guidelines and pricing
are necessary to address current risk exposure and maintain prudent underwriting practices.
These changes, effective for all mortgage insurance applications received on or after July
14, 2008, will help Radian’s clients provide appropriate and affordable homeownership
solutions for borrowers, while driving high-quality and profitable business. See guidelines go to
http://www.radianmi.com/pdf/Summary_of_July-14_Guideline_Revisions.pdf
Radian
Rate and Guideline Changes Effective July 14, 2008
Radian’s continued in-depth surveillance and review of mortgage market conditions and
loan performance lead us to conclude that additional changes to our guidelines and pricing
are necessary to address current risk exposure and maintain prudent underwriting practices.
These changes, effective for all mortgage insurance applications received on or after July
14, 2008, will help Radian’s clients provide appropriate and affordable homeownership
solutions for borrowers, while driving high-quality and profitable business. See guidelines go to
http://www.radianmi.com/pdf/Summary_of_July-14_Guideline_Revisions.pdf
Monday, July 14, 2008
Mortgage News
Treasury Acts to Shore Up Fannie Mae and Freddie Mac
http://www.nytimes.com/2008/07/14/washington/14fannie.html?_r=1&th&emc=th&oref=slogin
Government as the Big Lender
http://www.nytimes.com/2008/07/14/washington/14guarantee.html?_r=1&th&emc=th&oref=slogin
http://www.nytimes.com/2008/07/14/washington/14fannie.html?_r=1&th&emc=th&oref=slogin
Government as the Big Lender
http://www.nytimes.com/2008/07/14/washington/14guarantee.html?_r=1&th&emc=th&oref=slogin
Thursday, July 10, 2008
Mortgage News
Federal regulators prepare to tighten mortgage rules Los Angeles Times, CA - Jul 9, 2008
On Monday, the Federal Reserve is expected to require lenders to document borrowers' incomes
http://www.latimes.com/news/local/politics/cal/la-fi-housing9-2008jul09,0,1345381.story
On Monday, the Federal Reserve is expected to require lenders to document borrowers' incomes
http://www.latimes.com/news/local/politics/cal/la-fi-housing9-2008jul09,0,1345381.story
Monday, July 7, 2008
Economy
Trend Lines Perspectives on Utah's Economy June/July http://jobs.utah.gov/opencms/wi/pubs/trendlines/julaug08/index.html
Mortgage News
Presidential candidates' housing plans at a glance
The Associated Press - Jul 5, 2008_Separately, McCain wants the Justice Department to create a task force to investigate potential criminal wrongdoing in the mortgage industry. ...
http://ap.google.com/article/ALeqM5gFwzdW1h39lz-B1WN4GN4T9jFFgAD91NMQI00
Americas Watchdog Warns All, U.S. Homeowners, U.S. Pension Funds and Shareholders of Mutual Funds to Get Ready for Grim Economic News with a Preview of 2009 http://www.prweb.com/releases/2008/7/prweb1065064.htm
The Associated Press - Jul 5, 2008_Separately, McCain wants the Justice Department to create a task force to investigate potential criminal wrongdoing in the mortgage industry. ...
http://ap.google.com/article/ALeqM5gFwzdW1h39lz-B1WN4GN4T9jFFgAD91NMQI00
Americas Watchdog Warns All, U.S. Homeowners, U.S. Pension Funds and Shareholders of Mutual Funds to Get Ready for Grim Economic News with a Preview of 2009 http://www.prweb.com/releases/2008/7/prweb1065064.htm
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