Posts Tagged ‘mortgage’
Renters can Stay is Good news for Homeowners
The unfolding mortgage crisis ushered in some good news for home sellers and renters, alike. Fannie Mae will allow paying tenants to stay in their rental homes, after a defaulting borrower’s property is foreclosed on.
The new policy brings some much needed relief to tenants, who find that they are often innocent victims of the foreclosure crisis. Landlord’s often use tenants as a revenue stream, long after they quit making mortgage payments. As a result, thousands of renters, who were unaware that their landlord was in foreclosure, have been evicted through no fault of their own.
The new policy is historic because lender’s want to get foreclosed property ready for a new buyer, as soon as possible. Typically, renters make this difficult to do. But, in this environment, thousands of homes sit vacant and fall into disrepair, because the tenant is gone and no one is buying.
This policy is a win-win for lenders and neighboring homeowners, as well. Vacant properties pull down prices and the appeal of any neighborhood, even the good ones. By leaving the paying tenant in place, the lender’s home’s are occupied and maintained, while they collect rent. Homeseller’s benefit from a stable neighborhood, and they don’t have to compete against the vacant foreclosure’s, as they try to sell their owner occupied homes.
Fannie Mae and Freddie Mac have a moratorium on foreclosures and evictions through January 9, 2009. The hold on holiday evictions has allowed 10,000 families to stay in their homes, and the new policy means that thousands of renters may escape eviction after the first of the year.
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Housing Relief – Loan Modification Help Is Here
A new loan modification program was just unveiled that may help thousands of homeowners, that are facing foreclosure. The loan modification program is the latest attempt by the federal government to stabilize the real estate market. Thr program will not provide direct financial help, but it does provide assistance to those at risk of losing their homes.
The program will benefit borrowers who are at least 3 months behind on their mortgage payments, if they live in the home and have not filed for bankruptcy.
Borrower’s who fit the criteria would be offered a mortgage loan that would bring the payment to no more than 38 percent of their monthly household income. Loan payments would be adjusted downward through interest rate cuts and longer terms of repayment. Borrower’s would be allowed up to 40 years to repay the debt versus the traditional 30 year mortgage most of us are familiar with.
Borrower’s who are in danger of foreclosure should immediately contact the lender who services their loan. The loan modification program was designed to be swift and efficient in stopping foreclosures. It is expected that 1.6 million Americans will lose their homes this year, and another 1.9 million are projected to lose their homes in 2009.
Efforts by the government to work with borrowers and homeowners and keep them in their homes is good news for neighborhoods and communities. The program is also good news for lenders and taxpayers as foreclosures typically cost the lender 50 percent of the loan value. Ouch!
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Hope for Homeowners & FHASecure Help Homeowners Refinance Risky Loans
Hope for Homeowners is a new program, created by congress, to assist homeowners in refinancing their “at risk” loans into more affordable FHA, insured mortgages.
It is estimated that over 400,000 homeowners could avoid foreclosure through participation in the voluntary program, by enrolling before September 30, 2011.
In order to qualify for the special refinancing, the original loan must have been originated on or before January 1, 2008. In addition, the existing mortgage payment must exceed 31 percent of the borrower’s gross monthly income.
FHASecure is another program designed to help homeowners refinance and avoid foreclosure. The program, which went into effect on July 14th, offers borrowers with ARM’s, the option to refinance with an FHA insured mortgage designed to lower the monthly mortgage payment. Under the FHASecure program, lenders can not disqualify borrowers based on loan payment deliquency and the lender may actually offer a second mortgage to make up the difference between the appraised value of the property and the outstanding balance due.
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