Consumer Mortgage News Made Simple
Image via Wikipedia The Federal Trade Commission (FTC) issued a ban on eight companies marketing loan modification services. The FTC’s statement alleges that “the marketers charged up-front fees and falsely claimed they could get their mortgage loans modified or prevent foreclosure on their homes.” The following defendants and settlements were named in the FTC’s recent press release: Federal Loan Modification Law Center - Steven Oscherowitz and other associates settled with the … [Read more...]
Successful loan modifications are providing debt relief for a few lucky homeowners. However, many are discovering that there is more bad news lurking--a significant ding to their credit. In some cases consumers are seeing as much as 100 points shaved from their credit scores. U.S. Rep. Jackie Spier (D-CA) doesn’t think that’s fair. Spier’s H.R. 5743, the Protecting Homeowners’ Credit History Act would protect consumers’ credit scores from negative reporting while paying their modified … [Read more...]
Image via Wikipedia Mortgage-backed securities took the US economy to the brink of total collapse when US bank over stuffed themselves with these assets. Attracted by the siren song of high yields and illusions that real estate always appreciate and homeowners never default in huge numbers, they learned the folly of their assumptions. Is the US Federal Reserve headed down the same road? Recently released Fed data shows that their balance sheet has grown to $2.324 trillion, mostly fueled by … [Read more...]
Image via Wikipedia An early morning report from Bloomberg Businessweek says AIG may be considering giving the US government a position in mortgage bonds to repay a portion if its Federal bailout debt. Ironically, this stake would be in the same "toxic assets" that nearly collapsed the large insurer. This report is being whispered by unnamed sources close to the potential AIG/US government deal. The mortgage bonds being considered in this trade would be assets in Maiden Lane II and Maiden … [Read more...]
Image by Casey Serin via Flickr According to a report just released by FICO, Inc., US consumers are sinking to new credit lows. The credit score bell curve, traditionally skewed above 700, has now drastically shifted below 599. In data released on MyFICO.com, figure show that over 25% of consumer (an estimated 43.4 million people) now have credit scores below 599. The explanation seems to be the millions of people losing jobs, underemployed, or hit with crisis that have had to rely on debt … [Read more...]
Image via Wikipedia More government home loan relief is ready to implement in Michigan and several other hard hit state economies. This latest round of housing recovery aid is targeted at homeowners struggling to make mortgage payments due to unemployment, medical crisis, or reduced income. State housing finance agencies across the nation submitted proposals to assist troubled homeowners in their regions. The government assistance fund, named the Housing Finance Agency Innovation Fund for … [Read more...]
As Mary Miller, Zillow's Director of Product Management, states in her blog post--mortgage shoppers are very focused on mortgage rates and closing fees. However, we all know those can be deceptive and depending on your plan for the home you are purchasing or refinancing, very misleading. Mary explains the value of this concept very nicely: When comparing mortgage quotes, most borrowers focus on two factors: interest rate and upfront fees. But it’s difficult to determine whether it makes more … [Read more...]
New favorite writer of mine, Martin Mandelman of Mandelman Matters, writes an interesting piece exonerating subprime borrowers from culpability in the mortgage meltdown: "What did surprise me was what our politicians and the media started blaming the meltdown on: sub-prime borrowers. Anyone that read me back then knows it well… and if I said it once I said it a thousand times: it’s NOT the sub-prime borrowers. At best people were confusing a fuse… with the bomb." Now, while I too am not blaming … [Read more...]
Image by Getty Images via Daylife Unemployment numbers rock the market and kill notions of "Green Shoots." Mike Shedlock does a nice job of comparing and contrasting the two camps in Battle Lines Form Over "Son of Stimulus". The housing market certainly isn't feeling any relief from the first stimulus (little of which has hit the street) and may lack the confidence a second one will improve the outlook. PIMCO tells us these housing prices are headed downhill for the next 2 years! Unfortunately, … [Read more...]
Image by Getty Images via Daylife In digesting any news or market an analyst most valuable contribution is sorting the signal from the noise. Unfortunately, in the current mortgage and real estate market we have too many noise makers: unpredictable executive and legislative actions, multiple regulatory opinions and guidance, skittish investors, and fearful consumers. So, with that being said, I won't try to be the mortgage market analyst. However, I will share some of the things I believe to be … [Read more...]