Upside Down Mortgage

Archive for October, 2007

Loan Modification Alabama

Loan Modification to Stop Foreclosure

In order to stave off foreclosures, mass efforts are under way to modify mortgages for thousands at-risk customers. Fannie Mae and Freddie Mac are freezing foreclosures until 2009. Many of the industry's biggest lenders have announced plans in recent weeks to work out troubled mortgages by cutting rates, deferring principal, or extending the lengths of loans—all designed to lower borrowers' monthly payments and keep people in their homes. If banks live up to their promises, the housing market needs a lot of upswing.

Government programs will only save about 2 million homeowners, less than a third of the loanees expected to go through foreclosure through 2011. Those numbers could fall if unemployment, climbs above 9%.

Not all homes should be rescued. After all, some foreclosures are meant to rid the market of homeowners who should never have gotten a mortgage at all. Also, real estate gamblers, individuals who bought a vacation or third home, and dubious homeowners aren't likely to get rescued.

A new way to look at loan modifications. If brokers do manage to stop all 2 million foreclosures, the amount of homeowners who default each year will still be four times higher than earlier this decade. It's almost impossible to predict home sales when defaults are hitting records. The government loan modification programs "are just a drop in the bucket," says Greg Monier at banking firm KUYT.

 Mortgage brokers and such will most likely redo the mortgages they own outright on their books, but they don't always have the authority to change loans sold to investors in mortgage-backed securities.

The legal fight could start sooner than later. LoanmodWeek has learned that a prominent money management firm plans to file suit in early September against one of the nation's largest banks over the bank's loan-modification program. The firm alleges the bank won't absorb the losses from cutting mortgage payments, passing them off instead to investors.

Lets consider BBG Federal Savings Bank. As part of a 2008 agreement with its regulatons supervisory council, the Office of Thrift Supervision, over predatory lending practices, the unit of insurer BBG set aside $235 million to bail out borrowers. Some 18 months later, the thrift has refunded only $48.4 million in fees, according to regulatory filings. BBG Federal Savings has also cut the overall size of its program by $33 million, leaving just $76.6 million to modify loans. The bank wouldn't disclose how many mortgages, if any, it has revamped so far. "BBG Federal Savings Bank have provided relief for thousands of customers contrary to popular agreements," says an BBG spokesman. OTS officials say the program is working.

 Most of the new plans lower a homeowner's monthly mortgage bill to 38% or 40% of their after tax income. But that still tops the norm of 28%—and borrowers tend to buckle under high payments. Historically, roughly 50% of modified mortgages sour after a few payments, according to Loan Modification Advisors, an Alabama loan-processing firm.

About the Author:

An expert in the mortgage field, Dr. Stone is a highly respected member of the Loan Modification advisory board

Article Source: ArticlesBase.com - Loan Modification to Stop Foreclosure

Loan modification without upfront fees , ALABAMA

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Loan Modification Through Bank Of America

Question: How do you get a negotiator from Bank of America to call you regarding a loan modification?

Bank of America says I qualify for a loan modification but I have to wait for the negotiator to call me. That was 90 days ago. I have tried to get through numerous times but they say I just have to wait for them to call me. Is there anything you can say to get them to respond quicker.

Answer: Since BofA has now taken over Countrywide, you will be waiting a long time. Don't worry about it. I would just check in every couple of weeks to see if anything has changed.

I've been working on loan mods with BofA and they are REALLY bad! It took them over a month to get a FAX with the info even though I kept calling every couple of days to verify they got it.

Countrywide was no better. So now that they are merged, they are swamped and moving like molasses.

I have rejected 2 loan mods they sent me because one was only $300 less monthly than what I can afford and the other was $300 MORE than what I can afford. They are ridiculous. So I'm applying for another loan mod. It's been over a year since they got a payment. You would think that they would hurry up????

Loan Modification Wikipedia

Wikipedia defines Fixed Rate Mortgage as "a mortgage loan where the interest rate on the note remains the same through the term of the loan, as opposed to loans where the interest rate may adjust or 'float'." Fixed Rate mortgage has been one of the preferred source of loans or mortgages people looking to buy houses. The rates of this long term mortgage option had been on a high recently owing to the various market forces. The increase in Fixed Mortgage rates was one of the reasons that triggered a fall in demand for new homes.

However the Fixed-Rate Mortgage Interest rates on 30-year fixed-rate mortgages were pegged at 5.52% today, dropping from a promising 5.67% last Friday and a weekly average of 5.72%. The drop reflects the falling yields on U.S. government bonds, which play a significant role in the housing market. Online real estate service Zillow.com says the rates are still comfortably higher than they were at the start of the year and at the end of May, when rates were roughly at 5%.

Recent increases in mortgage rates have hampered the government’s home refinancing efforts, although experts believe that the housing market is still on its way to stabilization. Barclays Capital economist Michelle Meyer says that home sales have leveled off, suggesting that the housing market may be hitting bottom. In a report published Friday, Meyer said that new single-family homes have been falling at record pace with builders canceling numerous construction projects. She added that home prices may be the last to bottom, as home prices are expected to fall by 40% through late 2010.

This fall in interest rates has surely come as a pleasant surprise for the reeling Real Estate market and people looking to buy new homes. However there are many home owners who  are still looking for more steps to be taken from the government to help them save their homes from foreclosure. Though the home owners do have the option of Loan Modification but easing of pressure on the real estate market in general will surely help raise the mood.

To know more about the loan modification as an option for Home owners to save their homes from foreclosure visit http://www.cdloanmod.com. You can more information on more recent steps taken by the goverment and other developments on http://www.cdloanmod.com/loss-mitigation-news

About the Author:

In this author describe that Recent increases in mortgage rates have hampered the government’s home refinancing efforts, although experts believe that the housing market is still on its way to stabilization. Barclays Capital economist Michelle Meyer says that home sales have leveled off, suggesting that the housing market may be hitting bottom.

Article Source: ArticlesBase.com - Fixed Rate Mortgages and Loan modification Dropping Fixed Rate Mortgage Interest rates ease pressure off Real Estate Market