Mortgage Volume Is on the Rise
Total volume was up 5.3 percent last week compared to the prior week, with most activity coming from refinancings, according to the Mortgage Bankers Association.Read more >
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Low Interest Rates Delay Option ARM Resets
Grim forecasts about underwater borrowers could be abated as more lenders help with refinancing to fixed-rate loans. Read more >
Obama’s Next Challenge: Stop Foreclosures
Daily Real Estate NewsFebruary 18, 2009
After President Obama signed the $787 billion economic stimulus plan into law Tuesday, he said now the focus needs to be on stopping the spread of foreclosures and falling home values.
“We must … do everything we can to help responsible home owners stay in their homes,” Obama said.
The challenge, say those who have been studying the problem, is to lower the amount of money borrowers must pay every month.
More than half of mortgage modifications have left borrowers with the same or higher loan payments because lenders tack on past-due principal, interest, taxes and insurance, which drives the total owed higher, according to an analysis by Alan M. White, a professor at Valparaiso University School of Law. The study looked at more than 23,000 modifications. At the same time, White says, lenders have been unwilling to reduce principal even for borrowers owing vastly more than their homes are worth.
As a result, 49 percent of borrowers redefaulted within six months after receiving a modification that increased their principal and interest payments by 10 percent to 20 percent, according to ratings company Fitch.
The re-default rate was 21 percent for borrowers who saw their payments fall by 20 percent or more.
Source: The Wall Street Journal, Ruth Simon (02/18/2009)
Pending Home Sales Show Healthy Gain
The forward-looking index, based on contracts signed, rose 6.3 percent in December. Big gains in the South and Midwest offset modest declines elsewhere, according to the latest NAR report.
How to Find Money to Invest in Real Estate
Talk to local, rather than national, banks first. They’re more likely to understand your business. Detailed documentation of the project’s income potential, as well as the time, money and sweat equity you’ve already put in, are essential.
Obama Promises More Low-Cost Mortgages
President Barack Obama on Saturday said reducing mortgage costs would be a key part of his plan to improve the economy.
States Step Up Foreclosure Relief Efforts
More than 30 states have adopted rules governing predatory lending, and many others have embraced foreclosure intervention or prevention programs to help keep more home owners in their homes.
Mortgage Rates Inch Up This Week
However, Freddie Mac’s chief economist expects short-term rates to remain low due to the Federal Reserve’s recent cut in the discount and federal-funds rates.
Crafting a Foreclosure Bailout No Slam-Dunk
Government officials are crafting a $40 billion plan to help delinquent home owners avoid foreclosure, but they want to make sure the plan isn’t too attractive.
Best Cities to Retire on a Budget
Forbes magazine analyzed housing affordability, inflationary pressures, and medical care to find the top cities for retirees.