Latest News

Action Update: Last night the House passed the 5 year Flood Insurance extension bill (HR1309). On to Senate.

Fannie/Freddie Servicing Guidelines
(April 28) The Federal Housing Finance Agency (FHFA) announced it has directed Fannie Mae and Freddie Mac (the government sponsored enterprises, or GSEs) to align their guidelines for the servicing of delinquent mortgages owned or guaranteed by the GSEs.

President's Podcast: Short Sales, Qualified Residential Mortgages, and Budget Battles
(April 19) NAR President Ron Phipps discusses new legislation in Congress aimed at putting a deadline on lenders responding to short sales.

NAR Comments on Credit Score Regulations
(April 14) NAR submitted comments to the Federal Trade Commission (FTC) and the Federal Reserve Board on proposals to amend their risk-based pricing rules.

45-day Short Sale Decision Legislation Introduced
(April 12) Representatives Tom Rooney (R-FL) and Robert Andrews (D-NJ) introduced H.R. 1498, the "Prompt Decision for Qualification of Short Sale Act of 2011"

Short Sale News & Updates in a Few

Clicks--C.A.R. has launched a new California short sales website, designed to offer members and consumers the most up-to-the-moment news, legislative information, legal tips, and lender criteria from the ever-changing short sale world. Short sale tips for REALTORS®, sellers, and buyers; a HAFA short sale fact sheet, a timeline for foreclosure proceedings, and advice on how to avoid foreclosure rescue scams are among the useful information that can be found on the new site. Site visitors also can find out about upcoming short sale webinar schedules, short sale publications, and the latest C.A.R. efforts to help members navigate this oft-confusing transaction. Log on to http://www2.realtoractioncenter.com/site/R?i=xR6pjnXlko8coSZcXaV7Fg.. to learn more.
 

  The Mercury News

More mortgage relief from the White House – but congressional ok doubtful
In his State of the Union Address, President Obama laid out a plan to help responsible borrowers and support a housing market recovery.  Details of that plan were released yesterday.  However, funding for the proposed program must be approved by Congress, lowering the possibility that it will be implemented quickly. 

Making sense of the story

• Operated by the Federal Housing Administration, the plan would allow underwater homeowners to refinance into cheaper federally insured loans.  Borrowers with good credit who are current on their loan payments are eligible.
   
• The measure also streamlines the process of refinancing an underwater mortgage, eliminating the need for an appraisal or submitting a new tax return.
   
• To qualify, borrowers must be current on their mortgage, have a minimum credit score of 580, and must be refinancing a loan on a single-family owner-occupied principal residence.
  
   
• Lenders only need to confirm that the borrower is employed.  Loans that are more than 140 percent of the home value probably would not qualify until banks wrote down part of the balance.
   
• Congress must approve $5 billion to $10 billion in funding, leading housing experts to praise the plan’s objectives with skepticism of it passing this year.

Read the full story
 

In other news ...

  CNN Money

Mortgage crimes are focus of new task force
President Obama announced last week that he’s asked the Justice Department to create a special unit of prosecutors and state attorneys general to investigate abusive lending and packaging of risky mortgages that led to the housing crisis.

Read the full story

  The Washington Post

Fannie and Freddie don’t deserve blame for bubble
There is plenty of blame to go around for the U.S. housing bubble, but not much of it belongs to Fannie Mae and Freddie Mac.

Read the full story 

  The Mercury News

Fight property tax bill with these tips
Declining house values create great opportunities for homeowners to contest their property tax bills and potentially save big money.

Read the full story

  San Diego Union Tribune

Appraisers: Fed rule has hurt our pay, borrowers
The American Guild of Appraisers is digging into a federal rule it says has driven down the quality of home valuations, negatively affecting appraiser wages along with borrowers trying to get mortgages or refinances.

Read the full story 

  CNNMoney

Foreclosures made up 20 percent of home sales in 3Q
Sales of homes in foreclosure comprised 20% of all U.S. residential sales during the third quarter, according to RealtyTrac.

Read the full story

  The New York Times

On troubleshooting
Those who have issues with their mortgage lenders now have another place to take them: The Consumer Financial Protection Bureau, which began accepting such complaints and inquiries this month.

Read the full story

  The Washington Post

Consumer confidence slips in January
The Conference Board said Tuesday that its Consumer Confidence Index is at 61.1, down from a revised 64.8 in December.

Read the full story

  HousingWire

Treasury, FHA to let borrowers appeal mortgage servicer action
The Treasury Dept. and the Federal Housing Administration will issue new rules in the coming months allowing borrowers to appeal mortgage servicer decisions under certain modification programs.

Read the full story

Talking Points

• As the housing market continues to struggle for stabilization, many homeowners are turning to strategic default.  Almost 11 million homes are now underwater, according to Corelogic.  Around 3.5 million homeowners are behind in their payments and another 1.5 million homes are already in the foreclosure process, according to RealtyTrac.
  
   
• Aside from the moral quandary of whether strategic default is the right decision, there also are other factors to consider.
   
• The borrowers’ credit scores will take a hit. According to FICO, someone with a 680 credit score would see their score decline anywhere between 85-100 points after a strategic default, and someone with a 780 credit score could lose 140-160 points.
   
• Borrowers who are considering strategically defaulting on a house should look at it as a last resort, not a first option.  Financial troubles could be eliminated by refinancing, especially if the Obama administration’s program is implemented.
   
• Each state has its own rules and regulations regarding foreclosures, which affect both the length of the process and what the borrower could be liable for in the end.