Mortgage

The Return Of Homebuyers

Mortgage — Tue, 07 Apr 2009 12:59:15 -0500

Half of all U.S. households can now afford today's median home value of $200,000 according to figures released by the National Association of Homebuilders. This is great news for the economy and for a hopeful recovery one of the worst housing slumps on record.

Signs of a housing recovery are everywhere, from mortgage rates at their lowest point ever to the upswing in existing home sales and even an 11 percent increase in housing permits for the month of February. This translates into a 2009 spring market that is poised to produce positive sales numbers and may even mark an end to slipping home values.

"With affordability up dramatically, reports from our builders in the field indicate that foot traffic in new homes is on the rise and consumer interest is increasing with each passing day. These are encouraging signs that the housing market may be finally reaching a bottom," said NAHB Chairman Joe Robson, a home builder from Tulsa, Okla.

Data from the Census Bureau comparing February 2007 to February 2009 shows that home buyers today can typically purchase a home for $20,000 less and save nearly $500 a month on a mortgage. The data also shows that 55.4 million Americans can now afford to own a home, that is a huge increase from 38.4 million just two years ago.

"That's an increase of 17 million households from conditions just two years ago and the best housing affordability number we have seen in years," said Robson. "We are now seeing the first signs that buyers are returning to the marketplace."

The $8,000 homebuyer tax credit has done its job by sparking an interest in home buying. During February and March nearly 1.5 million people looked deeper into the homebuyer tax credit by visiting the National Association of Realtors consumer website at www.federalhousingtaxcredit.com.

"With home values in many markets at the lowest level since 2003, an $8,000 tax credit available to first-time home buyers, fixed-rate mortgages under 5 percent, and an outstanding selection of homes to choose from, buyers are starting to recognize that this has the makings for a one-time opportunity to break into the market," said Robson.

Is now the right time for you to purchase a home? The first thing you should do before finding your dream home is to talk to a finance and mortgage professional first. This will allow you to determine how much you can afford and more importantly save you time when looking for a home.

For more on mortgage rates visit Future Planning Financial at www.fpf-direct.com.

Mortgage Rates For April 31 2009

Mortgage — Tue, 31 Mar 2009 12:44:10 -0500

Fixed mortgage rates ticked up slightly from last weeks averages according to the latest survey released by Zillow Mortgage Marketplace. However, folks in Georgia are still able to receive a 30 year fixed mortgage rate below 5 percent.

On a national basis, the 30 year fixed mortgage rate increased slightly from 5.06 percent to a current average of 5.09 percent. The 15 year fixed mortgage rate also saw a slight increase week over week from an average of 4.73 percent to a current average of 4.80 percent.

The 5 year adjustable mortgage rate, the only ARM that Zillow Mortgage Marketplace tracks, declined by 0.03 percent to a current average of 4.66 percent.

On a state by state basis, Georgia recorded the lowest 30 year fixed mortgage rate at 4.99 percent followed by Texas at 5.05 percent and California and Florida at 5.06 percent. Ohio recorded the highest average for a 30 year fixed mortgage rate at 5.24 percent followed by Illinois at 5.16 percent and New York at 5.15 percent.

Be sure to visit Future Planning Financial at www.fpf-direct.com for more mortgage news and local mortgage rates.

Bankers Meeting On Capital Hill

Mortgage — Fri, 27 Mar 2009 18:26:03 -0500

President Barack Obama sat down with CEO's from Bank of America, Bank of New York Mellon, JPMorgan Chase, Goldman Sachs and U.S. Bancorp today to discuss the current economic crisis.

In a press release, Secretary Robert Gibbs noted that Obama was pleased with the meeting stating Obama as saying "they had a good, productive and frank conversation." The main goal of the meeting was to let the bankers know that the doors to the White House are always open to them for discussions and critique on ways the White House should go forth on handling the economic crisis.

Reactions from CEO's as they left the White House Friday afternoon was that they felt more confidence in where the markets are heading today and that President Obama is working diligently on behalf of American citizens, as the President made it well known to the bankers that Americans are mad. Obama also emphasized that Wall Street needs Main Street and Main Street needs Wall Street, all of the bankers agreed and recognized that we are all in this together.

You can watch the videos from Bloomberg by visiting Future Planning Financial at www.fpf-direct.com.

Mortgage Rates For March 25 2009

Mortgage — Wed, 25 Mar 2009 11:55:08 -0500

The 30 year fixed mortgage rate fell, week over week, from 4.89 percent to an average contract rate of 4.63 percent. The 4.63 percent 30 year fixed rate is the lowest recorded by the Mortgage Bankers Association since it began its weekly survey in 1990.

The 15 year fixed mortgage rate also fell, week over week, from 4.52 percent to an average contract rate of 4.52 percent.

Finally the one year adjustable mortgage rates, the only rate to increase, jumped up from 6.20 percent to an average contract rate of 6.22 percent.

Mortgage applications surged 32.2 percent as mortgage rates have become very beneficial for homeowners and homebuyers. The refinance index alone increased an amazing 41.5 percent while the purchase index increased a slight 3.9 percent.

Of all the mortgage applications submitted over the past week, 78.5 percent of those applications were from homeowners looking to refinance their homes and take advantage of saving hundreds if not thousands of dollars on their home loans.

For more mortgage rates and mortgage news visit Future Planning Financial at www.fpf-direct.com.

Troubled Asset Relief Program Bails Out Over 100 Institutions

Mortgage — Wed, 17 Dec 2008 17:12:41 -0600

The Troubled Asset Relief Program (TARP) has surpassed the 100 bank and institution bailout point totaling $167,756,852,000 in taxpayer money under the Capital Purchase Program according to the December 16th, 2008 Transaction Report by the Treasury.

The first bailout recorded on the Capital Purchase Program was on October 28, 2008 for a total of $15,000,000,000 awarded to Bank of America. On that same day Citigroup, JP Morgan Chase and Wells Fargo have recorded the largest single transaction of $25,000,000,000. Since then the Treasury has eased its spending somewhat with the largest single transaction for the month of December in the amount of $935,000,000 to Popular, Inc. of San Juan Puerto Rico.

The Capital Purchase Program is equivalent to investing in the stock market. What happens is the Treasury purchases stock in these companies, in return this frees up cash for these institutions to lend to the general public on mortgage loans, car loan etc. If the Treasury places money into the right institutions there is a very good chance your money would turn a profit for the government. Money placed in the wrong institutions is basically chalked up as a loss.

However, there seems to be consensuses out there that these institutions are hoarding the cash for the Capital Purchase Program as the market continue to deteriorate. In the meantime the Treasury continues to put pressure on these institutions to make new loans that would in return revive the housing market.

The only problem right now is home values continue to deteriorate at a rapid pace; you can almost compare it to the drop in value of a new car after you drive it off the lot. This has led to The National Association of Realtors and National Association of Home Builders to push Congress into approving another stimulus package, dubbed "Fix Housing First", that would give homebuyers tax incentives and subsidized mortgage rates, as low as 2.99 percent 30 year fixed, to help stabilize home values.

It could be speculation but the next round of foreclosures may be on the horizon, and it has already been dubbed the Option Arm round. 60 minutes did a piece on how Option Arms are about to reset and many homeowners with these loans are having troubles paying their 1 percent teaser rate which will reset at a much higher rate.

It may not be as much as banks hoarding cash as they are preparing to hold the cards for the next round of bailouts that will be facing the U.S. housing market. Only time will be able to tell if the banks receiving and hoarding funds from the Capital Purchase Program are doing so wisely or selfishly.

Mortgage Rates For December 16 2008

Mortgage — Tue, 16 Dec 2008 12:23:23 -0600

The 30 year fixed mortgage rate is pushing closer to the Treasury's 4.5 percent mark in the latest reading. With the Federal Reserve expected to cut rates will it have a negative impact on mortgage rates?

According to Zillow Mortgage Marketplace 30 fixed mortgage rates fell 0.19 percent from last week to an average of 5.15 percent. The 15 year fixed mortgage rate also fell week over week and now averages an even 5 percent.

The 5 year adjustable mortgage rate showed a slight increase week over week of 0.01 percent to average 5.94 percent. With expectations of a Fed rate cut of short term rates however, the 5 year arm may show improvement over the coming days and weeks.

Speculation is that the Federal Reserve is going to be cutting interest rates by at least 0.50 percent. If that happens, the key interest rate will be sitting at 0.50 percent, the lowest since the 60s.

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The downside to an interest rate cut is that investors will begin to pull their money out of bonds and place it into other investments. What this does is drive long term mortgage rates up as mortgage rates are tied into the bond market. When bonds go down, mortgage rates go up and vice versa.

Keep an eye on mortgage rates and the Fed rate cut by visiting Future Planning Financial at www.fpf-direct.com.

Mortgage Rates - December 11, 2008

Mortgage — Thu, 11 Dec 2008 12:12:51 -0600

30 Year Fixed Mortgage Rate - 5.47% *4.5 Year Low

15 Year Fixed Mortgage Rate - 5.20%

5 Year Adjustable Mortgage Rate - 5.82%

1 Year Adjustable Mortgage Rate - 5.09%

Source: Freddie Mac Primary Mortgage Market Survey

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GAO Reports On TARP – High Risk

Mortgage — Wed, 10 Dec 2008 15:22:38 -0600

A “heightened risk that the interest of the government and taxpayers may not be adequately protected,” is what the Government Accountability Office stated about the TARP program.

The TARP program which was designed by the Treasury to purchase toxic mortgage loans quickly switched over into a program called the Capital Purchase Program (CPP) which is now used to inject capital into banks and other financial institutions.

Since the $700 billion TARP program began, $195 billion has been disbursed to 87 institutions through the CPP program. Oversight of this money once it leaves the Treasury is virtually nonexistent according to the report by the GAO.

Currently there are no requirements that institutions receiving funds from the government track or report how the funds are being used. The requirement of the Treasury is for the institutions receiving the funds are to increase the flow of credit.

Since the Treasury has not yet determined how it will monitor compliance with executive compensation or any other compliances or requirements, the Treasury’s ability to ensure accountability of the institutions receiving your money is very limited.

In response to the GAO report released today, Interim Assistant Secretary for Financial Stability Neel Kashkari said “The GAO report is just one example of our compliance with the tough oversight Congress has appropriately established over the TARP.” It may be that Congress’s oversight of the TARP program is tough but the Treasury’s oversight of your money to these institutions is rather pathetic.

Also disturbing is that the Treasury has not turned down one institution that has applied for the TARP program. Instead banks and institutions who appear unlikely to win approval are encouraged to withdraw from the process. Without knowing which financial institutions, if any, have been turned away from the capital purchase program -- and why -- taxpayers have no way to assess whether their money is being directed in the most effective manner.

Mortgage Rates For December 10th, 2008

Mortgage — Wed, 10 Dec 2008 10:52:29 -0600

30 year fixed rate: 5.45%

15 year fixed rate: 5.09%

1 year ARM: 6.76%

Source: Mortgage Bankers Association

Float or Lock? Get your answers at Future Planning Financial Mortgage Rate Watch section by visiting www.fpf-direct.com.

Mortgage Loan Modification Re-Defaults

Mortgage — Mon, 08 Dec 2008 14:33:34 -0600

The latest data from the OCC's Mortgage Metrics shows a disturbing trend of homeowners re-defaulting on their mortgages after a modification loan has been set up.

After 90 days the number of re-defaults is at 36 percent, 53 percent after 6 months and 58 percent after eight months. This is a disturbing report that may have the loan modification programs undergoing major changes, which may make it very difficult to get a modification loan.

So why haven't loan modifications been working? I believe the truth to be that many Americans are already way over extended and a simple modification that saves $250 a month just is not going to cut it. Granted $250 in monthly savings is great but that savings is being offset with rising energy and food cost, thank God gas prices came down.

So if you are looking for a loan modification program to help save your home there are other important steps you need to take to ensure your financial stability. First of all, get rid of your credit card debt and once you do get rid of it, dont go on a spending spree. Save your credit cards for emergency use only, and christmas presents are not an emergency.

Second, cut back on daily spending such as that morning cup of coffee at your favorite coffee shop. It may sound like pennies a day but you never know what that money could do for you after a month or year of savings.

Finally, start saving even if it is putting money away in the mattress as many Americans have lost faith in the banking system. It's time to simplify your life and your daily spending in order to come out ahead in this economy when it finally does turn around.

Foreclosures And What You Can Do

Mortgage — Fri, 05 Dec 2008 16:10:55 -0600

A new report released today shows that one out of every 10 U.S. homeowners is currently behind at least one payment on their mortgage or are currently facing foreclosure. However, there are steps that homeowners can take to help themselves get back on their feet and see a brighter future.

The first thing a homeowner who is behind on their mortgage payments should do is contact their mortgage lender immediately. Time is of the essence and the sooner you contact your lender the better the chances of you saving your home.

Recently the government also passed legislation that will help homeowners negotiate a new deal between the homeowner, the lender and the government to stem a foreclosure. The basic principles of this program includes the government picking up the tab for 10 percent of the homes current value while the current mortgage lender forgives any debt over the homes current value. In return the homeowner will receive a new loan at 90 percent of the homes current value at an affordable mortgage payment.

Don't be left in the dark, take advantage of the programs that are available before the government runs out of money and you are left without a home.

November Mortgage Rate Predictions

Mortgage — Sun, 02 Nov 2008 01:28:56 -0600

Mortgage rates are sure to remain volatile throughout the month of November as they have over the past couple of weeks. The only question is will mortgage rates increase or decrease throughout the month.

The biggest factors that will determine what mortgage rates are likely to do this month include consumer confidence, unemployment numbers and government intervention. The latest survey compile by Freddie Mac's Primary Mortgage Market Survey show fixed rate mortgages increasing over 0.40 percent and adjustable rate mortgages increasing over 0.15 percent.

Fixed rate mortgage are likely to show the biggest increases throughout the month as they are driven more by the overall US economy outlook for the near future (up to 5 years or so). Adjustable mortgage rates will likely show minimal increases as I believe the governmnet will step in and make big investments to that will help ease investors worries.

Forecasted average mortgage rates in November:

30 year fixed rate - 6.90 percent

15 year fixed rate - 6.625 percent

5 year adjustable rate - 6.5 percent

1 year adjustable rate - 5.625 percent

Mortgage Rates For October 24, 2008

Mortgage — Fri, 24 Oct 2008 07:19:58 -0500

30 year fixed rate: 6.04%

15 year fixed rate: 5.72%

5 year adjustabe rate: 6.06%

1 year adjustable rate: 5.23%

Source: Freddie Mac's Primary Mortgage Market Survey

See what other mortgage professionals from around the country are saying their mortgage rates are today and what they expect mortgage rates to do throughout the week at www.fpf-direct.com.

Mortgage Rates For October 22, 2008

Mortgage — Wed, 22 Oct 2008 15:23:18 -0500

30 year fixed rate: 6.28%

15 year fixed rate: 6.05%

1 year adjustable rate: 6.97%

Source: Mortgage Bankers Association

See what other mortgage professionals from around the country are saying their mortgage rates are today and what they expect mortgage rates to do throughout the week at www.fpf-direct.com.

Mortgage Rates For October 20, 2008

Mortgage — Mon, 20 Oct 2008 10:20:29 -0500

30 year fixed rate: 6.46%

15 year fixed rate: 6.14%

5 year adjustabe rate: 6.14%

1 year adjustable rate: 5.16%

Source: Freddie Mac's Primary Mortgage Market Survey

Fixed rates are likely to continue to increase throughout the week but don't take my word for it. See what other mortgage professionals from around the country are saying their mortgage rates are today and what they expect mortgage rates to do throughout the week at www.fpf-direct.com.

Mortgage Rates For October 17, 2008

Mortgage — Fri, 17 Oct 2008 00:06:53 -0500

30 year fixed rate: 6.47%

15 year fixed rate: 6.17%

1 year adjustable rate: 6.67%

Source: Freddie Mac's Mortgage Bankers Association

Mortgage Rates For October 13, 2008

Mortgage — Mon, 13 Oct 2008 08:56:29 -0500

30 year fixed rate: 5.94%

15 year fixed rate: 5.63%

5 year adjustable rate: 5.90%

1 year adjustable rate: 5.15%

Source: Freddie Mac's Primary Mortgage Market Survey

Fixed rates are likely to continue their descend throughout the week but don't take my word for it. See what other mortgage professionals from around the country are saying their mortgage rates are today and what they expect mortgage rates to do throughout the week at www.fpf-direct.com.

Breaking Down The Mortgage Bailout

Mortgage — Thu, 25 Sep 2008 23:04:46 -0500

Understanding the mortgage bailout runs a lot deeper than the government simply buying bad mortgages from lenders and putting the on the tax payers shoulders. In fact, the government may even be able line its pockets with trillions of dollars that would once again show the resiliency of the American economy.

The issue that currently faces banks and mortgage lenders is that they have assets on their books that have become illiquid because they are continually falling in price. Even if borrowers are current on their home loans, by regulation the lender would have to take a loss on the loan reducing its capital.

The two options for banks are either to hold on to the performing loan through maturity to recover its capital or take a big loss by selling the loan to investors for pennies on the dollar. No matter how you cut it the banks still is not recovering any capital in the short term in order to make new loans. As banks are unable to raise capital the economy starts to grind to a halt.

The governments proposed $700 billion bailout would put the government into the mortgage business as it would purchase these assets for cash and receive mortgage payments from homeowners.

The process begins with banks and mortgage lenders deciding which loans they would like to sell to the government. From there the Treasury decides on which loans to purchase and for what price, which is where the dilemma comes in.

As a taxpayer, you would want the government to purchase these loans at the lowest possible price. However, that hurts banks with more write downs and less capital which is the situation they are currently in. On the other hand, if the government purchases the loan for 100 percent of the value it was lent at, then taxpayers are paying the difference between the homes purchase price and its current depreciated value.

In order to make this transaction beneficial to both the banks and taxpayers, the government would value the mortgage at the borrower's capabilities of paying back the loan over the life. This doesn't necessarily mean the government will hold onto the loan until maturity but rather sell the loan to investors once the market has recovered.

No one believes that the taxpayer will be on the hook for the entire $700 billion bailout the government is proposing. In fact, some economists say that if the cards fall right this $700 billion investment could turn into a $2 plus trillion dollar asset.

Learn more about the mortgage bailout by visiting Future Planning Financial.

Fannie Mae and Freddie Mac Placed Into Conservatorship

Mortgage — Sun, 07 Sep 2008 17:36:48 -0500

Treasury Secretary Henry Paulson and FHFA Director James Lockhart made the official announcement today that the government will be taking over the two mortgage giants Fannie Mae and Freddie Mac.

The takeover includes an unlimited supply of money that is designed to help Fannie and Freddie increase liquiditability and help strengthen the residential housing market. It also allows the Treasury to purchase mortgage backed securities that are originated by the two mortgage giants.

Paulson stated "If the Treasury can hold the securities to maturity, taxpayer losses shall not occur, in fact the program could produce gains." My guess is that the Treasury will not be able to hold onto a good percentage of the securites as they plan to and this could cost taxpayers hundreds of thousands if not millions of dollars.

Also, James Lockhart has already replaced CEOs at the mortgage giants. Herb Allison will be taking over Fannie Mae and David Moffett will be taking over Freddie Mac. Other high ranking management positions at the two companies are not currently in jeopardy.

I believe that putting these two mortgage giants in conservatroship is just another move that prolongs the inevitable failure of Fannie and Freddie. The more involved the government becomes in the private sector of the mortgage and housing markets the longer it will take for the market to correct itself naturally.

Here is more information about the at take over of Fannie Mae and Freddie Mac and a video from MSNBC explaining the impact on the housing market.

Fannie Mae, Freddie Mac: Where Do They Stand

Mortgage — Sun, 20 Jul 2008 12:51:50 -0500

It is no doubt that Fannie Mae and Freddie Mac are the backbone to the success of the US mortgage industry. So how is it that these two mortgage giants came to a position where the government is stepping in to make certain that they do not fail?

Fannie Mae, created in 1938, and Freddie Mac, founded in 1970, buy mortgages from lenders and package them into securities that are sold to investors. This frees lenders to provide new mortgages, making it easier for more Americans to buy homes. The entities hold or guarantee $5.3 trillion in mortgages, about half the country's total, and guarantee principal and interest on the mortgage-backed securities.

Problems with Fannie and Freddie really began to surface when they posted their earnings for 2007 when both mortgage giants lost billions of dollars, proving that the mortgage crisis was poised to impact all types of mortgage lenders.

Even after the loss of billions of dollars, restrictions limiting the number of loans that Fannie and Freddie could purchase were lifted. Restrictions were imposed on the two mortgage giants for accounting scandals that happened within the two companies during the height of the mortgage boom.

Within two weeks of Fannie and Freddie having the capabilities to purchase more mortgage loans, the government made $200 billion available to the two companies to increase their purchasing power.

The latest actions by the government include making money available to Fannie and Freddie from the Federal Reserve Bank of New York should it become necessary.

However, Richard F. Syron, Chairman and CEO of Freddie Mac claims that Freddie is financially stable, stating "We are in the process of finalizing our June 30, 2008 results and we estimate that they will show we have a substantial capital cushion above the 20% mandatory target surplus established by our regulator. We expect the results will also show that we have a much greater surplus above the statutory minimum capital requirement. The company's capital and liquidity resources will enable it to continue to serve its public mission as it has always done."

Fannie Mae also claims to be a strong financial position. " We continue to hold more than adequate capital reserves and maintain access to liquidity from the capital markets. Given the market turmoil, having options to access provisional sources of liquidity if needed will help to strengthen overall confidence in the market. We will continue to do our part to provide liquidity, stability and affordability to the housing market now and in the future," states Daniel H. Mudd, President and CEO of Fannie Mae.

Fannie and Freddie may have adequate reserves to weather the storm for the time being. There is speculation however that this mortgage crisis will last beyond 2010 which could make it difficult for the two mortgage giants to continue to take losses without the government stepping in to help replenish Fannie and Freddie's reserves.

Keep updated with the latest mortgage headlines by visiting Future Planning Financial.

Mortgage Rates Continue Their Climb

Mortgage — Wed, 11 Jun 2008 12:37:35 -0500

Mortgage rates on fixed and adjustable mortgages increased throughout the week according to the Mortgage Bankers Associations weekly survey released June 11^th. Mortgage applications, on the other hand, increased 10.9 percent throughout the week on a seasonally adjusted basis.

The number of homeowners who filled out an application to refinance their homes rose by 8.4 percent through week's end, while applications for conventional home purchase loans rose 11 percent and government purchase applications rose 17 percent.

30 year fixed mortgage rates increased sharply for the second week in a row, this weeks survey shows the 30 year rate at 6.24 percent. That is an increase of 0.07 percent this week following an increase last week of 0.21 percent.

15 year fixed mortgage rates also increased for a second week in a row. Last week the 15 year mortgage rate increased by 0.21 percent, this week the 15 year rate increased .08 percent and currently sits at 5.78 percent.

After a small decline on the 1 year adjustable mortgage rate last week, the 1 year rate increased slightly by 0.03 percent to 6.8 percent this week.

The survey by the Mortgage Bankers Association covers approximately 50 percent of all US retail residential mortgage applications. All mortgage rates are based off of 80 percent loan to value and include the origination fees.

Get the Mortgage Rate Forecast For June 2008 by visiting Future Planning Financial at www.fpf-direct.com.

Home Ownership Just Became More Affordable

Mortgage — Sun, 18 May 2008 22:16:36 -0500

Coming into the month of May the biggest concern for the US economy was the grim outlook many economist had on inflation. Inflation was expected to push mortgage rates higher and slow an already slow US housing market.

However, economic reports have been coming in better than expected week after week. This has helped to push mortgage rates on a downward trend for a majority of the month. According to Freddie Mac's Primary Mortgage Market Survey the 30 year fixed mortgage rate is at it's lowest point since the survey on April 17th 2008.The 30 year fixed rate mortgage is the most common mortgage that first time homebuyer's use when financing a home.

Fannie Mae also came out with some great news, stating that they would lower down payment requirements on a national level. In December of 2007 Fannie Mae imposed down payment restrictions in declining markets which made it very difficult for first time homebuyers the ability to afford a new home. The new requirements go into effect on June 1st 2008 and require a 3 percent down payment for homebuyers approved through Fannie Maes Desktop Underwriter and 5 percent down for homebuyers approved on other underwriting systems.

If economic reports continue to come in better than expected you may see mortgage rates drop by up to an eigth of a point or more before the end of the month. Home values throughout much of the country have already began to see prices level off or even begin to rise in value, which could get many homebuyers off the fence and into their new home.

The U.S. House of Representatives Passes American Housing Rescue and Foreclosure Prevention Act

Mortgage — Mon, 12 May 2008 15:26:29 -0500

The new act which was passed on May 8^th, 2008 will help those facing foreclosure to refinance into an affordable FHA mortgage and help make homeownership more affordable for first time homebuyers.

The first amendment to the new act includes an amendment to the FHA Housing Stabilization and Homeownership Retention Act which expands FHA programs so many borrowers in danger of losing their homes can refinance into a lower cost government insured mortgage they can afford. The expansion is limited to owner occupied primary residences only and would also provide up to $230 million for financial counseling to help families stay in their homes.

The amendment also strengthens regulations on Fannie Mae, Freddie Mac and the Federal Home Loan Bank system and includes an increase jumbo mortgage loan limits in high cost areas, making home ownership more affordable for homebuyers in these areas.

The second amendment would provide $11 billion in tax benefits to help spur home sales and stabilize the U.S. housing market. First time homebuyers could receive up to $7,500 in a refundable tax credit that works like an interest free loan that is to be paid back over 15 years. There would also be a temporary increase of $10 billion in a tax exempt mortgage revenue bond to refinance subprime loans and to provide loans to first time homebuyers.

NAR President Dick Gaylord said, "This is meaningful legislation that can have a major impact. Our Realtor® members appreciate the House's hard work and bipartisan effort in bringing forth legislation that will go a long way toward helping people become and remain homeowners"

Will The Housing Market Correct Itself In 2008

Mortgage — Thu, 08 May 2008 23:05:40 -0500

Today NAR posted its Pending Home Sales Index report for March 2008, showing a 1 percent decline from a month ago. As the report goes on, the problem in the housing market lies under the credit crunch that is limiting homebuyers the capability to qualify for a mortgage.

On a national level, NAR goes on to project a rise in existing home sales before the year is over. The Northeast region was the only region in March that actually showed a gain on the index from last month. In an unpublished snapshot data report, sales in Bakersfield, CA, and Jackson, MS, were higher than a year ago.

In order for the housing market to correct itself before the end of the year, changes need to be made on credit standards for homebuyers. This will need to start with reforming the FHA, who is responsible for helping low to moderate income households qualify for a new home loan. Incentives such as tax breaks for first time homebuyers who purchase foreclosed and distressed properties could make 2008 the year the market corrects itself.

NAR Applauds Fannie Mae's Latest Initiative

Mortgage — Tue, 06 May 2008 18:58:33 -0500

Today Fannie Mae posted a $2.2 billion dollar loss, but underneath their announcement Fannie Mae showed initiative with a new mortgage aid program which could put $10 billion in financing to play for qualified first time homebuyers.

"Keys To Recovery" is the new multi-purpose aid program that has a series of "keys" to help not only first time homebuyers but those who are in fear of losing their homes. Additionally the program includes a rent-to-own option for those who have been hit the hardest.

NAR President Richard F. Gaylord stated, "We appreciate these new initiatives, which demonstrate Fannie Mae's commitment to sustainable homeownership."