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Foreclosures Must Be Stopped
July's foreclosure rate is the highest since RealtyTrac(a home value and real-estate statistic comapny)began keeping records 2 years ago, and 32% higher than August of 2008. Lenders believe it is more profitable to foreclose on a home than to agree on a loan modification, according to some industry analysts. Foreclosures continue rising as more adjustable-rate mortgages become due at higher rates.
Over one half (57%) of foreclosured homes are from the following four states: California, Arizona, Nevada and Florida. California servicing companies have been hiring more employees in their loss-mitigation departments(good news for Californens looking for work), foreshadowingmore losses to come.
The Obama administration is requesting lenders and servisors to voluntarily double loan modifications by November 1. The Making Home Affordable plan generated less than 300,000 loan modifications so far. Analysts say that banks are waiting for housing prices to improve before making loan modifications in the hopes they won't lose as much profit.
What It Means to You
Fannie Mae and Freddie Mac are working with the Treasury Department's Making Home Affordable. This grew out of the HOPE NOW program to offer a streamlined loan modification process. All 1,600 lenders and 29,000 mortgage brokers using Fannie Mae's Desktop Underwriter® platform will quickly process any refinance applications for Fannie Mae loans.
Even borrowers who are "upside down" in their mortgage can apply, as Fannie Mae will refinance loans up to 105% of a home's value. Existing mortgages can also be modified by reducing interest rates or lengthening the payment time frame to bring monthly payments down to 31% of the borrower's income. To find out if you are eligible, go to Making Home Affordable" Click here to return to What's New In The News.
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