Category — Mortgage News

Doing its part to help stimulate the tumbling housing market, FHA increased its loan limits as highs as $729,750 (in some areas of the country). Now there is talk of making this temporary situation a permanent one. The increase is set to expire at the end of 2009, but experts fear that allowing the size limitations to return to its original amounts may hinder full recovery of the housing and lending markets.  

The U.S. Treasury is expected to join the ranks of other federal agencies launching programs to help homeowners avoid foreclosure. The official announcement is due out the week of October 19, 2009 but some information was pre-released at the recent MBA convention. The Treasury has named the foreclosure avoidance effort Home Affordable Foreclosure Alternatives (HAFA).  

The credit market seems to be alive and well again as sales in the bond market continue to rise. In the first half of this year record amounts of debt has been sold in both the U.S. and in Europe. Even year-to-date, at the nine month mark of 2009, the credit market seems to be on the mend. 

The deadline for the First Time Homebuyers $8,000 tax credit is looming, which has many people scrambling to buy a home quickly so they can cash in on their free money too. Realtors, mortgage lenders, the federal government and even individuals believe this incentive has helped to stimulate the housing market.  

According to Fannie Mae President and CEO Michael Williams, Fannie Mae is funding the lenders on the loans guaranteed by the mortgage giant faster than ever before. This is in an effort to ensure that the lenders have the cash they need to continue funding loans. It’s Fannie’s own way of helping to stimulate the economy—specifically the housing and lending market.  

There are some interesting speeches, announcements and numbers expected to be released today. As this is being written, Fed Chairman Ben Bernanke is delivering a speech at a congressional conference. 

After hearing complaints from struggling homeowners who have nowhere else to turn, a CNN investigation has revealed that the Making Home Affordable program isn’t working the way it’s supposed to be working. Based on government estimates, only 231,000 homeowners are taking advantage of a program that almost 4 million homeowners are eligible to use to reduce their mortgage payments.  

According to a recent Wall Street Journal article, the Federal Housing Administration (FHA) has so many foreclosures on its books that its money reserves are almost below the minimum required. Because of increasing default and foreclosure rates the FHA is required by Congress to hold at least 2% of a capital reserve ratio.  

Lender Processing Services (LPS) released the results of its recent housing survey. What were the results? LPS believes, based on its findings, that there is a direct link between the number of real-estate owned foreclosures being sold and the prices of houses. In essence, the fact that there are so many foreclosed homes being sold at drastically reduced prices, it’s dragging the value and cost of the other houses selling on the market down with it.  

In July, the Government Accountability Office prepared a report for Congress regarding the Home Interest Mortgage Deduction. This report found that many homeowners are misrepresenting their share of tax liability based on this deduction. Some homeowners are claiming too much, while others are claiming too little. This leads to the question: do you qualify?