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Posts Tagged ‘Mortgage loan’

Federal Housing Chief Supports California Bill of Rights

The series of bills backed Attorney General Kamala Harris to help avoid future foreclosure abuses have found a new supporter in federal housing chief, Shaun Donovan.

The so-called California Bill of Rights “would restrict practices such as foreclosing on homeowners as they try to negotiate a loan modification and mandate that banks designate a single person to work with troubled borrowers,” as reported by the Los Angeles Times.

The financial-industry and business trade groups have opposed the bills, arguing that while the national mortgage settlement’s terms are temporary and apply to only five banks, the bills’ changes would be permanent and universal. In fact, the proposed California Bill of Rights provides longer term protection for homeowners where the national mortgage settlement expires.

Those who oppose the bills also object to giving borrowers the right to sue to block foreclosures or recover losses when banks violate the law in more than just a trivial way. We feel strongly that banks should not be able to take advantage of distressed homeowners and ignore their rights in any way during the foreclosure process. The national mortgage settlement does not acknowledge individual borrowers whose lenders violate the new safeguards but the proposed California Bill of Rights provides a remedy to that.

Foreclosures hold steady

The imminent wave of foreclosures has still yet to strike with new numbers out from Lender Processing Services, Inc. showing that March foreclosures have stayed steady. The new data from LPS also shows that are still down from March 2011.

69,000 foreclosures were completed in March, compared to 85,000 in March 2011 and 66,000 foreclosures in February 2012.

The Los Angeles Times reports: “About 1.4 million homes, or 3.4% of all homes with a mortgage, were at some stage in the foreclosure process last month, the same as in February but down slightly compared with 1.5 million in March 2011, Santa Ana research firm CoreLogic said.”

The rate of foreclosures has slowed since last year during accusations of faulty practices and improper paperwork by lenders. Experts have predicted that foreclosures are expected to rise again since the  national settlement was reached in February. However, there has been little uptick in the number of foreclosures which could be a result of the national mortgage settlement that pushes lenders to work with troubled borrowers to avoid foreclosure.

Scam Alert: Mortgage Foreclosure Scams on the Rise

April 24, 2012 Leave a comment

Homeowners beware: the number of reported mortgage foreclosure scams has increased 60 percent so far in 2012, according to the Homeownership Preservation Foundation.

The Huffington Post reports that scammers are exploiting the recent increase in government programs such as the recent national mortgage settlement.

New York Attorney General Eric Schneiderman has warned that scammers claim to be government officials involved in the settlement and try to obtain personal financial information from homeowners seeking assistance.

As foreclosures are expected to rise again in the coming months, homeowners are need to be cautious when seeking debt relief and are reminded to do their research when hiring assistance with the loan modification process.

New Rules to Fight Foreclosure

April 16, 2012 Leave a comment

Last week, Congress mandated changes in the rules covering the mortgage servicing industry.

According to the Associated Press, “The Consumer Financial Protection Bureau‘s proposed rules would require mortgage servicers to give all borrowers standardized monthly statements and warn borrowers about interest rate or insurance change.”

The proposed rules also require the mortgage servicers to make “good-faith efforts” to contact borrowers at risk of foreclosure and give them options to avoid losing their homes and also include stipulations for improving record-keeping and providing foreclosure counseling to those who need it.

The Consumer Financial Protection Bureau, which supervises U.S. payday lenders, mortgage companies and private student lenders and also can write rules to supervise big lending companies and institute fines, will formally propose the rules this summer and finalize them by January 2013.

California Foreclosures Decrease

April 6, 2012 1 comment

CoreLogic reports that California had the third biggest decrease among U.S. states in the number of homes at some stage in the foreclosure process, according to the Orange County Register.

The report also states that in February, 2.4 percent of the California homeowners with a mortgage faced the possibility of foreclosure – which equals about 160,000 households.

The Orange County Register reports that CoreLogic’s February numbers showed:

  • 6.7 percent of the state’s mortgaged homes, or about 458,000 households, were 90 days or more late on their house payments. That’s down from 9 percent in February of last year.
  • Banks seized 154,212 homes through foreclosure in the 12 months ending in February.
  • Nationwide, banks seized 3.4 million homes through foreclosure during the past 3 ½ years – more than 860,000 of them in the past year.
  • An additional 1.4 million U.S. homes, or 3.4 percent of all homes with a mortgage, were in the foreclosure process.
  • That’s down from 3.6 percent in February of last year, when 1.5 million U.S. households were in the foreclosure process.

BofA offers Mortgage to Lease Program

March 28, 2012 Leave a comment

In a new effort to help distressed homeowners, Bank of America has announced that it will be offering a Mortgage to Lease program that allows homeowners to stay as renters in their home.

The pilot program will launch in Arizona, Nevada and New York and will help up to 1,000 homeowners selected by the bank. If the program is successful, it may expand to other markets to help more at-risk homeowners in other states.

CNNMoney.com reports that homeowners cannot apply to be a part of the program. The bank will select homeowners that are more than 60 days delinquent on their home loans, have high loan balances in relation to their current property value, have no other liens on their property, and have an income level high enough to afford the rent.

According to CNNMoney.co, upon selection into the program, “the homeowner will transfer title to their property to Bank of America and have their outstanding mortgage debt forgiven. In exchange, they may lease their home for up to three years at or below the current market rental rate.”

The Mortgage Brokers Association estimates approximately 200,000 homeowners in Arizona, Nevada and New York who are 60 days delinquent on their loans but that includes all lenders, not just Bank of America, and it does not include homes in those states that are already in the foreclosure process.

Obama Makes Mortgage Refis Easier and Cheaper to Obtain

March 12, 2012 Leave a comment

President Obama has announced that the Federal Housing Administration will lower mortgage insurance premiums for borrowers who refinance their loans under a new plan to improve the housing market.

Borrowers who refinance their existing FHA loans will pay an upfront insurance premium equal to 0.1%, the lowest allowable rate, of the mortgage amount, plus an annual fee of 0.55%. The new program is available to all borrowers who are current on their payments even if they owe more than their homes are worth, and loans that were issued before June 1, 2009 are eligible for the new fees – which equals to an estimated 2 to 3 million borrowers. CNNMoney.com reports that these cuts, which take effect April 9, could reduce mortgage payments for the typical FHA borrower by about a thousand dollars a year, according to the administration.

According to CNNMoney.com, “the new policy will also make it easier for the banks to refinance loans because it directs the FHA not to count the loans toward the lender’s “compare ratio.” That calculates the performance of loans issued by the lenders and compares it to the performance of other lenders.”

President Obama also announced also announced steps to provide relief to service members who were wrongfully foreclosed on.

CNNMoney.com reports:

“As part of the plan, mortgage lenders and servicers will be required to review the case of every service member who was foreclosed on since 2006. Any member of the military who wrongfully lost their home to foreclosure during that period will be repaid for their lost equity, plus interest. They will also receive a flat fee of $116,785.

Service members who were denied the opportunity to refinance at the 6% interest rate required under the Relief Act will also be refunded anything they were charged over the 6% rate, plus interest.

In addition, military members who bought their homes between July 1, 2006 and December 31, 2008 and were forced to sell them at a loss due to a permanent change in station may be compensated for the loss in their home’s value.”