Realtors in Wisconsin worry that a planned increase in the cost of federal mortgage insurance could stifle the already struggling home market in the state. The insurance is typically used by low-income buyers, who could be forced out of the home market by the cost increase, they say.

This summer, Congress gave the Federal Housing Administration, which provides the insurance, authority to increase its premiums by up to three fold. The agency planned to double the premiums this month but instead postponed the increase until October. The average increase in monthly premiums will be $40, according to FHA.

Lenders typically require borrowers making less than a 20 percent down payment on a home to take out mortgage insurance, which offers partial protection to lenders if the borrower defaults. The insurance lowers closing costs and credit requirements for the borrower, lessening barriers for low-income buyers, but then the borrower is on the hook for monthly payments, according to the U.S. Department of Housing and Urban Development.

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Posted in: Housing Market
Tags: borrower defaults, department of housing and urban development, federal housing administration, fha mortgage insurance, mortgage insurance program, prospective buyers, rate increase, wisconsin realtors association

Today’s weekly mortgage applications survey from the Mortgage Bankers Association seemed to offer a small glimmer of hope.

Yes, refinancings—which have been running at around 80 percent of all mortgage applications—fell despite a new record low average rate on the 30-year fixed of 4.38 percent.

Not so good.

But on the other hand, purchase applications rose 2.4 percent, largely driven by a 4.5 percent increase in government purchase applications (FHA).

Great, except for that last part.

Government purchase applications have been driving the market for the past year, accounting for, at times, nearly half of all new loans. That may be about to change. New premium authority (translation: higher prices) goes into effect next week, on October 4. New seller concessions policies are about to go into effect as well.

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Posted in: Mortgages
Tags: jumbo loan, mortgage applications, mortgage bankers association, mortgage market, mortgage origination, national mortgage news, new mortgage, purchase loans

We all dream of owning a house someday. This is why we save for it. However, one mistake can lead us to regret ever making the purchase because this can lead to different problems. This is why you have to be careful. Many homebuyers commit the same mistakes over and over again. Knowing these mistakes will help you avoid them.

Among the mistakes that buyers commit concerns finding a good lender. Others make a mistake of failing to know the real value of the property or its condition. While there are also those who find issues concerning the neighborhood their home is in.

Here are some of the common mistakes buyers make:

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Posted in: Home Buying
Tags: buying a house, common mistakes buyers, good faith estimate, homebuyers, lenders, mistake, mortgage rate, neighborhood, suitable lender

At a recently held event at the Pentagon, Fannie Mae and the U.S. Army announced new initiatives to help service members who are struggling with their mortgage payments avoid foreclosure. The effort includes a mortgage payment forbearance of up to six months where the death or injury of a service member on active duty causes a hardship for impacted military families with a mortgage obligation.

The company also announced the creation of a special hotline, 877-MIL-4566, available to all service members to receive guidance about their mortgage options and enlist assistance.

“The men and women of our Armed Forces have shown extraordinary commitment to our country while facing unique challenges as a result of their service,” said Jeff Hayward, senior vice president of Fannie Mae’s National Servicing Organization. “No family impacted by a death or injury in the line of duty should have to face the additional burden of foreclosure as a result of the hardship. We want to do all that we can to provide support to these families at a time of need as we honor their sacrifices and service to our country.”

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Posted in: Housing Market
Tags: army installations, economic hardships, fannie mae, forbearance, line of duty, military families, mortgage company, mortgage obligation, mortgage options, mortgage payment, mortgage payments, service member, service members, u s army

Jeff’s Note:

I almost didn’t post this article as I think it’s a load of hooey although there are some truths in it. In whatever you do, there are risks. Yes, if you own a home and lose your job or there is a devastating illness in the family you can lose the home – you can also get kicked out of your apartment under the same conditions.

I am often suspicious of articles and politicians who cite actual people (i.e. Sally Muckenfuch of Rancho Kukamunga says…), so, when I see Sally used, I tend to doubt the premise of the article. If they had hard facts, the writers would use them.

Finally, this quote is the biggest pile of baloney of them all:

““The average homeowner, however, consistently derives more pain, but no more joy, from a house and home,” Bucchianeri said.”

Why don’t I like it? Simply because I don’t think it is true. I think the average homeowner does derive joy from owning their home despite the struggle that it may have become. How do I know? I’m an average homeowner.

Now, to the article:

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Posted in: Housing Market
Tags: american dream, apartment, federal reserve bank, homeownership, Real estate, struggle

Rep. Barney Frank & Co. are getting set for yet another hearing this week on the future of Fannie Mae and Freddie Mac, the government-controlled mortgage lenders. Once again, they’re not after the truth — they’re looking to conceal it.

The House Financial Services Committee chairman and his brethren on the left want you to believe they’re making a good-faith effort to figure out what went wrong with Fannie and Freddie — what mistakes led to their failure and takeover by the government during the 2008 financial collapse, and how to fix both institutions for the future.

In fact, what they’ll deliver is more hot air from so-called “housing advocates” obscuring just how much Fannie and Freddie contributed to the housing

bubble, the 2008 financial collapse and the Great Recession.

It’s all meant to give lawmakers an excuse not to do what’s necessary and prudent — namely, kill Fannie and Freddie before they come back to do it all again.

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Posted in: Housing Market
Tags: barney frank, fannie mae and freddie mac, financial collapse, government sponsored enterprises, housing bubble, Housing Market, mortgage lenders, obama, us taxpayer

Remember how everyone complained that banks weren’t doing enough to help troubled borrowers?

Well …

Banks have realized that foreclosing on home after home after home may not be in anyone’s best interest — least of all their own. So they’ve ramped up the number of loan modifications they’re handing out to their delinquent clients.

Banks are doing nearly twice as many modifications under their own foreclosure prevention initiatives than under the Obama administration’s signature Home Affordable Modification Program, known as HAMP.

But before homeowners rejoice, they should take a close look at the terms of their bank modification offers, consumer advocates say. Many may not be as good as HAMP, which lowers monthly payments to 31% of pre-tax income.

“We don’t know if they are sustainable based on the monthly payment,” said John Snyder, manager of foreclosure prevention programs at NeighborWorks America, adding banks don’t release a lot of information about their modifications. “We’re not sure what to think.”

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Posted in: Foreclosure
Tags: consumer advocates, foreclosure prevention programs, mortgage servicers, obama, prevention initiatives

Unemployed homeowners cannot count jobless benefits as income when applying for mortgage modifications if they have loans backed by Fannie Mae. That could greatly limit their ability to get a long-term reduction in their monthly payments.

Because the jobless benefits can’t be considered permanent income, the lender will instead evaluate troubled borrowers for forbearance plans of up to six months. The new guidelines, released Tuesday, will take effect Nov. 1.

“We don’t want to set up borrowers to fail, said Amy Bonitatibus, Fannie Mae spokeswoman.

Fannie Mae’s announcement broadens a ban already put in place from the Treasury Department. In July, the agency quit allowing unemployment insurance to be used as income when applying for the administration’s signature Home Affordable Modification Program, known as HAMP. Previously, borrowers had been allowed to do so.

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Posted in: Foreclosure
Tags: delinquencies, fannie mae, jobless benefits, mortgage market, unemployment benefits, unemployment insurance