We will see but below is a great article that talks about the current crisis and the S&L crisis along with how first-time homebuyers are now able to afford to buy a home. They can help to lead us out of this.
http://online.wsj.com/article/SB10001424052970203946904574300520224287120.html#mod=rss_opinion_main
I have to tell you that Shelia Bair is one smart person. She is the Chairman of the FDIC. I don’t just say that because of this article because this isn’t rocket science but I think she just has the right approach to this mortgage mess.
“The Federal Deposit Insurance Corp., grappling with the worst banking crisis since the 1990s, is poised to start breaking failed financial institutions into good and bad pieces in an effort to drum up more interest from prospective buyers.”
http://online.wsj.com/article/SB124891131732891921.html#mod=todays_us_money_and_investing
I can’t seem to grasp what they are talking about here. Maybe you can. “Even when borrowers stop paying, mortgage companies that service the loans collect fees out of the proceeds when homes are ultimately sold in foreclosure. So the longer borrowers remain delinquent, the greater the opportunities for these mortgage companies to extract revenue — fees for insurance, appraisals, title searches and legal services.”
http://www.msnbc.msn.com/id/32214198/ns/business-the_new_york_times/
The article below has 5 good things for you to follow when it comes to the appraised value of your home.
Again, at least we hope so. This sounds just like the Hope for Homeowners loan which was supposed to help over 400,000 borrowers and the last figure I heard is that it helped 357 people. The Obama Administration is supposed to announce something on it today.
“Like the broader Obama program, the FHA plan seeks to reduce mortgage-related payments to 31% of monthly income. But it gets there in a different way, by focusing on changes in the principal amount rather than the interest rate.”
They refinanced their home, took cash out, and are now singing the blues. If you took out $100,000 and are now upside down you would think they still have some of that money, right? Wrong again, they spent it. It’s different if you put it back into your home and are just not getting the value for your improvements out of it because everything that is selling is a foreclosure or short sale. Well, at least here in South Florida that is the case. Bottom line, many homes were used as ATM’s.
“Why are so many homeowners underwater on their mortgages?
In crafting programs to prevent foreclosures, policymakers have assumed that the primary reason homeowners owe more on their home than it is worth is that they bought at the top of the market. In other words, they’ve lost equity primarily through forces beyond their control.
A new study challenges this premise and finds that excessive borrowing may have played as great a role.”
That is what is being reported and not to be a pessimist but I know I won’t believe it until I see it. Especially when this article is posted the same day the article about banks preferring foreclosures came out.
“Loan servicers will “significantly” increase the pace of mortgage modifications under the Obama foreclosure prevention program, the Treasury Department said Tuesday.”
This is great news and will hopefully instill even more confidence in the housing market.
“Home prices in May posted their first monthly increase since the summer of 2006, indicating prices are finally stabilizing, data Tuesday showed.
http://www.msnbc.msn.com/id/32184856/ns/business-real_estate/
Apparently they do and I don’t just say that because of the article below. This has been very apparent by their actions throughout this housing crisis. I understand why the article states this but banks lack common sense and I could go on for days as to why I say this. The part that they leave out is that 60% or so of the modified loans end up in default again because the modified payment is higher. See, that makes no sense.
“Policymakers often say it’s a good deal for lenders to cut borrowers a break on mortgage payments to keep them in their homes. But, according to researchers and industry experts, foreclosing can be more profitable.”
http://www.msnbc.msn.com/id/32181495/ns/business-washington_post/
The article below talks about a couple that moved to Atlanta to retire. They were going to rent but due to low prices decided to buy. This is an interesting part of the article and although it mentions California it also holds true to Florida. No one can predict it for sure but if you look at the bidding wars going on in South Florida it seems as though it could be right.
“On average, U.S. home prices are projected to fall through the end of 2010. But that may not hold true for the market where you want to buy your retirement home. Some places that were hit hard early in the bust, like parts of California, are likely to recover sooner, according to forecasters Moody’s Economy.com.”
Located in South Florida, Justin Miller has established himself as a leader in the mortgage community for his expert advice and understanding of the current real estate climate. Contact him.
Jonathon Becker (Coastal Credit Clinic): Justin- GREAT blog post! This is a HUGE questions many of my clients h...
Sean: Justin- Great article...would be great to understand the differences i...
Phil Himes: You are so correct! Many of my clients are currently looking at purch...
Stock quote: Good blog post, nice efforts. It couldn’t appear to have been penned a...
Upside Down Guy: This sounds like a great program for someone like me but my lending in...