Smart Borrower Blog

Archive for the ‘Mortgage Refinancing’ Category

New Association Aims to Combat Loan Modification Scams

NeighborWorks America, a non-profit created by Congress, has launched a national public education campaign aimed at helping homeowners, particularly those facing foreclosure, avoid mortgage modification scams. Their recently launched website, www.loanscamalert.org, provides information and resources to help spot scams, as well provides a central place to notify authorities of scams they may have encountered. In addition to the website, the campaign will draw on the support of public agencies at all levels of government as well as other financial institutions and non-profits to get the word out. According to their press release: The national foreclosure rate has reached an all-time... more »

Some May Avoid Foreclosure with Loan Modification

Thousands of people have recently been facilitated with the process of home loan modification during this recession. Recipients are able to repay their loan amount as they’re able, which protects them from ruining their credit and allows them to remain in their homes. Dealing with everyday living expenses and mortgage payments at the same time can become overwhelming and complicated. A majority of people are unaware of the details concerning the numerous qualifications for home loan modification. Don’t be discouraged to apply, even if you have bad credit, because there are many ways to get approval for a home loan... more »

Frank Considers Reviving “Cram Down” Legislation

Barney Frank, House Financial Services Committee Chairman, is concerned that lenders aren’t doing enough to help modify home loans that are in stress. Frank is threatening to revive the “cram-down” legislation that failed to pass Congress earlier this year. Under this legislation, federal judges are given the power to cut interest rates, reduce mortgage balances and extend terms. The judges would have the authority to do this even if the lender protests. Although Congress has given the mortgage industry many tools to quickly and easily modify loans, the results have been dismal, according to Frank. An article on Bloomberg.com tells... more »

Swindlers Take Advantage Of Distressed Homeowners

Every night, the nightly news tells us about more and more foreclosures, and people in trouble with credit card bills and other unsecured debt. People, desperate to get out from under this staggering situation, are turning to any service or company that can help them find relief. With people in such distress, it is inevitable that unethical people come around to take advantage of them. In an article in The New York Times, the reporter wrote about a new breed of swindler. These defrauders aren’t trying any longer to bilk people out of the little equity they may have in... more »

Pimco Backing Out of U.S. Treasury Toxic-Debt Program

Pimco, the world’s largest bond manager, has backed out of the treasury’s plan to buy up to $40 billion in assets from banks, according to Bloomberg. The plan, called the Public-Private Investment Program (PPIP), was originally expected to buy as much as $1 trillion in mortgage backed assets and devalued real estate loans. Pimco had originally announced in March that it would participate in the program. In June, the bond manager withdrew its application for participation, citing uncertainties about the design of the initiative. The government’s plan is smaller than originally expected. With Pimco backing away from the program, questions... more »

Mortgage Rates Once Again On The Rise

A recent article in Newsweek tells us that it’s a known fact that the Federal Reserve has been working to keep a mortgage rates down.   They have been buying treasury debt in an effort to keep mortgage rates low.   Although that has seen some light at the end of the tunnel, many economists are warning that now rising mortgage rates will put a stop to any rebound that the Fed had worked hard for. Moody’s, in its weekly   credit outlook released on June 8 said that The Economic Cycle Research Institute’s (ECRI) leading index showed that although... more »

Who Qualifies For The Making Home Affordable Program?

Often, when searching for content for the blog, I go to such sites as Bankrate or MSN Money. I’ve been keeping an eye on President Obama’s Making Home Affordable program. It is an ambitious effort to help those facing foreclosure. The article on Bankrate was interesting, and answers vital questions for those seeking help. What will this program do for those in need? For one, it helps a homeowner to convert to a fixed rate 30 or 15 year mortgage. The homeowner can be underwater on the loan and still be eligible for the program. The cap stands at 105... more »

Experts Warn OF Another Wave Of Foreclosures

With rising unemployment numbers, housing prices falling and inventory going up, industry experts are predicting that a second wave of the mortgage crisis is due to happen.   They predicted this new wave will be even more severe than the subprime mortgage crisis. Everyone is aware that the housing market is far from normal.   Stability will not happen in the market soon, because the great amount of inventory is causing home prices to drop and the job market is unstable.   I recently wrote on option ARM’s, and the problems this type of mortgaging brought to the market.  ... more »

Small Business Owners Under Fire

It is of particular interest to those that watch happenings in the mortgage market to see what happens when small-business owners get in difficulty.   In an article in the New York Times this morning, there was an article about a Chicago banker turned junk loan buyer.   The buyer, Rick Williamson, sees his role as that of someone helping to clean up bad debt that is clogging the economy.   Mr. Winston says “if you want to fix what is ailing this country, you need to destroy the worthless debt out there.   You have to shut down the... more »

Total Lending Down in February But TARP Banks Increasing Pace

According to a report from the Treasury Department released Wednesday, the number of loans being made by all residential, commercial and industrial property lenders dipped in February although banks and lenders receiving emergency government funds saw an increase in loan originations. Total lending dropped by a median 2 percent in February, with the Treasury reporting that in the commercial real estate market, “New loan demand remained low due to the lack of new construction activity." The Treasury added in its statement that   “uncertain economic conditions have resulted in borrowers reducing expenses, paying down debt, and delaying capital expenditure.” Basically,... more »