The News Review:
- RI congressional delegation backs more help for citizens
- SOLUTIONS TO REDUCE MORTGAGE COSTS
- 2 mortgage brokers face license revocation
- Mortgage Meltdown: Let the Finger-Pointing Begin
- Market Spotlight: Mortgages
RI congressional delegation backs more help for citizens
Providence Journal – Apr 1, 2008
“People are under a lot of pressure,” said Whitehouse, who is a cosponsor of the Foreclosure Prevention Act. “You get two or three foreclosures on a block and the whole block begins to collapse. ”The bill would provide money for pre-foreclosure counseling to property owners, help refinance subprime mortgages and allow judges to reduce mortgage amounts as part of bankruptcy proceedings. Reed, a senior member of the Senate’s Banking, Housing and Urban Affairs Committee, is one of the bill’s coauthors. The crisis in housing finance has spilled into other areas of the economy, Kennedy noted, including student loans. Recent news reports made note of lenders scaling back student-loan programs because of the credit turmoil — initially caused by the subprime-mortgage meltdown — and cuts in federal subsidies. Some banks and finance groups have moved out of the student-loan business.
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SOLUTIONS TO REDUCE MORTGAGE COSTS
New York Post – Apr 1, 2008
Many homeowners are getting out of their adjustable rate mortgages & locking into a low fixed rate mortgage. With a fixed rate, you never have to worry about your payment increasing monthly or yearly. Please call us for a no-cost refinance consultation. You can speak directly to Steven Weiss at (877) 684-3625.
2 mortgage brokers face license revocation
Denver Post – Apr 1, 2008
The division alleges that Stearnes, while working with an out-of-state client, fraudulently redirected the consumer’s refinance proceeds of $80,890. 38 into an account owned by Benaske, owner of Broadway Mortgage Corp. According to the division, Stearnes admitted during the investigation to using $24,000 of the borrower’s funds to pay off an auto loan, and Benaske admitted to using $12,500 of the funds to pay for the development of his mortgage company’s website.
Mortgage Meltdown: Let the Finger-Pointing Begin
Realty Times – Apr 1, 2008
Loan officers downplayed the fact that the interest rates would probably rise significantly months or years down the road. They told the buyers that they could simply refinance if the rate was too high. Unfortunately, when credit tightened, homeowners could no longer refinance with a conventional mortgage. Foreclosure became imminent. During the big party when housing prices were on the rise and interest rates were dropping, mortgage brokers and the loan officers who worked for them, turned away few if any applicants. If you didn’t make enough money, they would encourage you to fudge the numbers on your loan application. To boost your credit score, you could simply piggyback on someone else’s credit card (this little loophole has been fixed).
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Market Spotlight: Mortgages
Forbes – Apr 1, 2008
‘There’s no question the increases are a hurdle for customers,’ said Doug Duncan, chief economist at the Mortgage Bankers Association. It is still too early to determine exactly how much of a difference it will make because the guidelines are so new, Duncan added. Fannie Mae announced it is setting new ‘loan-level price adjustments’ based on a customer’s credit score, loan-to-value ratio (percentage of the amount of the loan compared to the total value of the property) and if the loan is to purchase or refinance a home. The new charges can be paid upfront or be added to the amount of the loan, which could also affect a customer’s interest rate. The fees do not officially go into effect until June, but because of lag time between when a lender originates a loan and when it is sold to Fannie Mae, the fees have already made their way into lenders’ guidelines, said Dan Green, a certified mortgage planning specialist and author of TheMortgageReports. The addition of a risk-based pricing scheme, coupled with a previous plan to expand the size of loans Fannie Mae and fellow GSE Freddie Mac (nyse:… ‘They are doing everything that they can to keep mortgage money available,’ Green said. ‘Instead of declining to lend, (Fannie Mae) is making adjustments to risk. ‘ While the added costs might affect who can borrow, Brady said the new policies have spurred a bit more competition and confidence from lenders. The expanded loan sizes and fees allow lenders to know they can originate a loan and then have the option of selling it to the GSEs in the future. That option was not available before the changes.