Mortgage interest rates have reached historically low levels. It’s truly amazing how much the average borrower’s purchasing power has increased! The following chart tells it all. Check out the chart showing the history of interest rates as well as the examples of the savings below:
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Over the past years, many of Americans pulled money out their homes through “cash-out” refis. Today, many of my clients are bringing cash into their refinance transactions. Money is flowing in the opposite direction. You might consider bringing cash to close your refinance to: 1. Lower your mortgage rate: If your LTV is close to the 80% Loan to Value (LTV) threshold, then bringing money to the table to push your LTV below 80% can get the borrower a better rate. Yesterday, four fair housing organizations released their findings of a year-long undercover investigation of 80 loan modification companies, which reveal an industry rife with corrupt practices. The National Fair Housing Alliance, the Connecticut Fair Housing Center, Housing Opportunities Made Equal of Virginia, Inc., and the Miami Valley Fair Housing Center issued a report entitled, “Have I Got a Deal for You! An Undercover Investigation of Mortgage Loan Modification Scams,” which documents the tactics mortgage modification scammers use to take money from vulnerable homeowners. Dennis Norman The U.S. Department of the Treasury and the Department of Housing and Urban Development today released their “October 2010 Scorecard” on the “Obama Administration’s Efforts to Stabilize the Housing Market”. The scorecard points out the success of “The President’s housing market recovery efforts” but does point out that “data in the scorecard also show that the recovery in the housing market continues to remain fragile.” Dennis Norman Last week HUD announced changes to FHA home loan programs to provide refinancing options to homeowners who owe more than their home is worth. Under FHA’s new plan, existing underwater homeowners can refinance their existing non-FHA loan into a FHA loan as long as they are current on their loan and their current lender reduces their total mortgage debt by at least 10 percent of the loan amount. The total mortgage amount for the borrower after refinancing cannot be greater than 115 percent of the current value of the home, bring the loan amount for Continue Reading → Dennis Norman MortgageDaily.Com tracks mortgage company failures on it’s website The Mortgage Graveyard. According to The Mortgage Graveyard 225 mortgage-related firms in the U.S. ended operations or failed in 2009, higher than any year since they began tracking data in 1998. This was an increase of over 80% from 2008 which saw 124 firms fail. The annual surge was fueled by a spike in bank failures — which increased more than 400 percent. Banks account for most of the country’s residential originations. Credit union failures, including corporate and state-regulated institutions, were up by more than a third. Here in Continue Reading → Dennis Norman By: Dennis Norman Earlier this week the Treasury Department released it’s eight “Tranche” report updating the status of the TARP (Troubled Asset Relief Program) which includes the Home Affordable Modification Programthat I have written about on several occasions. The report shows that progress is being made with regard to loan modifications with $27.07 billion, of the $50 billion available) committed to loan modifications through September 30, 2009 (see “HAMP” details on chart below). Continue Reading → To alleviate some suffering by homeowners, the Obama Administration introduced the “Making Homes Affordable” plan last March. Unfortunately, the plan has not yet had the intended effect. Article by the Grand Law Firm Economists debate whether or not the country is actually currently in a recession. Some say that there are positive signs that we have reached the bottom and the economy is turning around. Others, however, suggest that the country still has a long way to go and it may be years yet before we truly reach financial recovery. Regardless of who is right though, one thing is clear: Continue Reading → Dennis Norman By: Dennis Norman In an effort to help delinquent borrowers obtain Loan Modifications under the Affordable Refinance Program of the Making Home Affordable Program Freddie Mac has hired a company to come to borrowers homes and help them put together the documents and complete other actions needed to begin their three-month trial payment periods under the Affordable Refinance Program. The company hired by Freddie Mac, Titanium Solutions, will target late-paying borrowers with Freddie-Mac owned mortgages who have not responded to letters or phone calls from their lenders or those who have responded but need to provide additional Continue Reading → Dennis Norman According to a study conducted by First American CoreLogicentitled “How the U.S. Consumer Has Benefited from Mortgage Finance Programs in 2009”, projections are there will be $2.3 billion in mortgages refinanced as a result of the Fed’s “Making Home Affordable” plan. According to the study, the median individual monthly savings was $120. “ The quantitative easing policies of the Federal Reserve and refinance activity made possible by the Home Affordable Refinance Program (HARP) have allowed more than 2 million consumers to reduce their monthly mortgage debt obligations and put more money in their pockets,” said Mark Fleming Continue Reading → Dennis Norman Included in the “Making Home Affordable” program from the Obama administration is the “Home Affordable Modification Plan” (HAMP) designed to help 3 to 4 million home owners by modifying their existing loans to help them be more affordable. Last week, Michael S. Barr, the Assistant Secretary for Financial Institutions, testified before a congressional sub-committee on the status of these programs. In his testimony Mr. Barr said that weakness in the US housing market developed over many years and that during this period “inadequate regulation of lending and securitization practices, including lax underwriting standards, helped cause widespread over-leveraging Continue Reading → Dennis Norman A surge in litigation tied to real estate appraisals, loan modifications and foreclosures contributed to a 54 percent increase in mortgage-related lawsuits, according to the second quarter Mortgage Litigation Report from MortgageDaily.com. During the second quarter, 125 cases were tracked, jumping from an already active 81 first quarter cases. The second quarter of 2008 had just 42 cases. Dennis Norman By: Dennis Norman All the news lately about the housing market, home sales in particular, has been encouraging and showing signs of stabilization in the real estate market and demonstrating that the real estate market may have seen the worst. Just when you think you may be through the storm though you see another dark cloud lurking in the distance. For the real estate market this dark cloud could very well be mortgage delinquencies and foreclosures. At the end of this week the Mortgage Bankers Association reported that serious mortgage delinquencies (homeowners that are 90 or Continue Reading → Freddie Mac announced that in the second quarter of 2009, refinancing borrowers overwhelmingly chose fixed-rate loans, regardless of whether their original loan was an adjustable-rate mortgage (ARM) or fixed. In fact, ninety-nine percent of prime borrowers who originally had a conforming ARM selected a new conforming fixed-rate mortgage when they refinanced. While 30-year fixed-rate mortgages still tend to be the preferred loan, more borrowers are choosing 15-year fixed-rate loans than before. “When interest rates hit very low levels for fixed-rate mortgages, borrowers often take tis opportunity to lower their interest rate and shorten their loan term,” said Frank Nothaft, vice Continue Reading → Dennis Norman By: Dennis Norman Buying a home should be a dream come true not a nightmare of worry and stress. A new Federal Reserve Board publication, “5 Tips for Shopping for a Mortgage,” will help consumers avoid potential pitfalls and make well-informed decisions when choosing a home loan. Financing the purchase of a home is one of the most complex financial decisions that consumers make. The Federal Reserve’s latest “5 tips” guide is designed to help home buyers find the mortgage that is best for them. The complete guide is available here however a summary of Continue Reading → Dennis Norman By: Dennis Norman Today we pick up where we left off yesterday with my E-View TM with respected mortgage banker, H. John Frank, President of Paramount Mortgage Co. here in St. Louis. If you missed part one, two, or three, there are links to both at the end of this post. And now, the final part of the E-View TM: Q-This is a good time probably to address the Internet. There appear to be hundreds of lenders on the Internet for the consumer to choose from in addition to their local lenders. Do you think there Continue Reading → Dennis Norman By: Dennis Norman Today we pick up where we left off yesterday with my E-View TM with respected mortgage banker, H. John Frank, President of Paramount Mortgage Co. here in St. Louis. If you missed part one or two, there are links to both at the end of this post. And now, part three of the E-View TM: Q-I have seen a lot of reports about “jumbo” loans and rates being artificially high on those loans. What is a “jumbo” loan and have the rates been affected in a negative way as a result of the Continue Reading → H. John Frank, Jr., President, Paramount Mortgage Co. By: Dennis Norman Yesterday I did the first post of my E-View TM with respected mortgage banker, H. John Frank, President of Paramount Mortgage Co. located here in St. Louis. Today we continue with part two of the E-View TM: Q-How many states require mortgage brokers/bankers to be licensed? Does licensing protect the consumer in your opinion? If so, how? If not, why not? A-I don’t know how many states require licenses, but later this year (I believe around the 1st of August) most, if not all, states Continue Reading → Dennis Norman By: Dennis Norman It seems home mortgages are in the news daily lately: record-low interest rates, record-high foreclosure rates, the sub-prime mortgage mess, lack of jumbo loans and so on. It’s confusing at best and causing much concern for many people wishing to buy a home or refinance their existing home mortgage. H. John Frank, Jr., President Paramount Mortgage Co. To find out just what is going on in the home mortgage world today I turned to someone I have known for over 20 years that is a highly respected St. Louis mortgage banker, Continue Reading → |
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