Loan Modifications

Top Real Estate Headlines for Week Ending: December 3rd

Thanksgiving, Black Friday and Cyber Monday have come and gone. The holiday spirit is in full swing as families throughout Northwest Indiana have begun to display their holiday decorations. For those of you who desire to buy a home or refinance your home before the New Year, let’s take a minute to review what the top real estate and mortgage healdines were this week according to the National Association of Realtors.

• Commercial Real Estate Prices Show Gains
  Commercial property values are showing signs of a strong recovery, up more than 30 percent from the 2009 lows, according to Green Street Advisors.
• Deficit Reduction Commission Endorses Plan
  The bipartisan commission voted in support of the plan for spending cuts and tax changes, but fell short of a super majority that would automatically put the measure in front of Congress.
• Foreclosure Crisis Slowing Sales
  Data from ForeclosureRadar shows that sales of distressed properties are declining, in part due to investors walking away from deals.
• NAR: Commercial Real Estate Stabilizing
  A steady improvement in the economy should lead to modest growth in the commercial real estate sector next year.
• Strong Rebound in Pending Home Sales
  NAR’s forward-looking index jumped more than 10 percent in October from September.
• Buyers Show Growing Interest in Tiny Houses
  As the economic realities of the “new normal” set in, consumers seem to be thinking smaller when it comes to their residences.
• 8 Factors for Standing Out in Real Estate
  Start with strong ethics, end with strong contacts.
• New-Home Sales Slide
  Sales of new houses dropped more than 8 percent in October, according to the U.S. Department of Commerce.
• Boulder, Colorado, Is Smartest U.S. City
  Six of the 10 brainiest places have populations under one million, according to Portfolio.com study.
• Mortgage Regulator Defends Two-Track Process
  Edward DeMarco, acting director of the Federal Housing Finance Agency, said lenders should continue to pursue foreclosures against borrowers while simultaneously trying to rework their loan terms.

These were the top real estate and mortgage headlines for the week ending December 3, 2010.

Want to know how these national real estate headlines could impact you right here locally in Northwest Indiana? Subscribe to this blog, Today’s Real Estate Reality, and let our collective years of real estate experience in Northwest Indiana guide you to an informed and successful real estate transaction today.

Loan Modifications

Streamlined Modifications – Will it Help?

The Federal Housing Finance Agency (FHFA) announced today that a major program designed to simplify and streamline loan modifications for struggling homeowners to prevent foreclosures had been established. The collaboration between Fannie Mae (FNM), Freddie Mac (FRM), Federal Home Loan Banks, HOPE NOW (and it’s 27 service partners), Department of Treasury, Federal Housing Administration and FHFA would be implemented by December 15th.

Who will be eligible?

1. Owner Occupied Primary Residences ONLY
2. Three or more missed payments (90 day late)
3. Has NOT Filed for Bankruptcy
4. Loan is FNM, FRM or Portfolio with Participating Investors
5. Certify economic hardship/change in financial circumstances
6. DID NOT Purposely Default to Obtain Modification

The primary objective of the new program is to make mortgage payments affordable to those who can qualify. The allowable housing debt ratio for the program is 38%. This can be achieved by the reduction in interest rate, extending the term (30 years to 40 years) and restructuring the principle balance payment structure…or any combination.

It must be noted that the main difference between the new program and the HOPE for Homeownership provision in the Home Economic Recovery Act 2008 is that it is not intended for principal balances to be forgiven. This should be more appealing to lenders; however, less incentive to homeowners that have negative equity.

Therefore, who will really benefit from the streamline modification program?