Category — Mortgage News

Since the Obama Administration took office, many initiatives and programs have launched to help stimulate the economy as a whole. Specific tactics targeted correcting the floundering mortgage market. Even after the government invested $75 million in HAMP to incent mortgage service companies to modify loans and decrease foreclosure rates, the program has left the administration, mortgage borrowers and mortgage servicers sorely disappointed.  

Not only are HUD and the U.S. Treasury taking on a more active role in mortgage modifications and how mortgage service companies are doing their job, but this less than laissez faire approach has trickled down to Fannie Mae as well.  

The news has been grim for quite some time, the economy is in the drain, unemployment is on the rise and foreclosures have reached an all-time high. Everyone is feeling the pinch, and none more than the multitude of animals that are being affected. Pet foreclosure victims are on the rise and rescue organizations are at their breaking points.  

There has been a whirlwind of talk swirling around the Federal Housing Administration (FHA) and its continuous drop below the 2% reserve requirement mandated by Congress. Most economists and financial experts believe the FHA reserves won’t fall below zero. In fact, talk is that the reserve amount even seems to be showing signs of a positive outlook.  

HR 3548, also known as the Worker, Homeownership and Business Act of 2009, and better known for its provision of the first time homebuyers’ credit, doesn’t only exist to help consumers become homeowners. Its establishment is to help the housing market as a whole. This help extends to homebuilders across the nation struggling to make ends meet over the past few years.  

The National Association of Realtors® (NAR) and many other interested parties won their fight for Congress to expand and extend the tax credit for first time homebuyers. To date, the tax credit is responsible for generating $22 billion and offering two million people home ownership with a tax incentive.  

There is a reason why governmental programs and agencies are created. Maybe nothing illustrates this better than the Federal Housing Authority (FHA). FHA is responsible for instituting programs and initiatives that have saved almost a million homeowners from possible foreclosure and financial ruin with its refinance program. This figure doesn’t include the almost two million borrowers that took advantage of bargain housing prices and low interest rates to finance the purchase of a new home, permitting 80% of these buyers to buy their first home—all with FHA secured mortgage financing.  FHA is currently responsible for originating almost 25% of all mortgages originated today.  

The numbers and are in for existing home sales for the month of September. And the results favor the effectiveness of the first-time homebuyers’ credit program. According to the National Association of Realtors (NAR), five consecutive months of the last six months have shown an increase in existing home sales, which the organization directly associates with the incentive program.  

All good things must (and usually do) end, and it’s no secret that the First Time Homebuyer’s Credit expiration date is looming. The National Association of Realtors, along with countless real estate agents and lending institutions are waving the last lap flag in the race to buying a first home. The American Recovery and Reinvestment Act of 2009 allows for up to $8000 tax credit to a first time home buyer that closes a loan on the purchase of a primary residence on or before November 30, 2009. 

Two weeks ago, mortgage interest rates had reached a five-week low. Last week, in anticipation of what the Federal Reserve Board would have to say, many mortgage borrowers were waiting to lock-in the interest rate on their impending loans. Once the Fed spoke, by the end of last week, interest rates had spiked about a quarter of a point.