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A new announcement outlining the Board of Governors of the Federal Reserve System interim Final Rule for Making Home Affordable Modification Ruling.

Offices represented:
Federal Deposit Insurance Corporation
Office of the Comptroller of the Currency
Office of Thrift Supervision

Released June 26, 2009

 Agencies Issue Interim Final Rule for Mortgage Loans Modified Under the Making Home Affordable Program.  Loan modification Ca homeowners would be affected by the new ruling.

The federal bank and thrift regulatory agencies today invited public comment on an interim final rule that provides that mortgage loans modified under the U.S. Department of the Treasury’s Making Home Affordable Program (MHAP)will retain the risk weight applicable before modification. On March 4, 2009, the Treasury announced guidelines under the MHAP to promote sustainable loan modifications for homeowners at risk of losing their homes to foreclosure. The interim final rule would provide a common interagency capital treatment for mortgage loans modified under MHAP. For example, mortgage loans risk weighted at 50 percent prior to modification would continue to be risk weighted at 50 percent after modification provided they continue to meet other applicable criteria.

The interim final rule, by the Office of the Comptroller of the Currency, Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, and Office of Thrift Supervision, will take effect upon publication in the Federal Register, which is expected shortly.  Public comments must be submitted within 30 days after publication in the Federal Register. 

The Board Of Governor’s is allowing any public comments to be submitted within thirty days from the date of publication.  The pdf that details the new ruling can be found by clicking here.

The new ruling applies to Fannie Mae and Freddie Mac insured loans.  If you have a loan that is owned by one of these entities and are in need of a loan modification Ca program these new rulings will provide you with a guideline as to what options your lender has available to you under the new Home Affordable Modification program.  It would be advisable to review this final ruling before you attempt to modify your home mortgage loan.

Publisher- Michael Kench Uncategorized Applicable Criteria, Avoiding Foreclosure, Board Of Governors, Board Of Governors Of The Federal Reserve, Board Of Governors Of The Federal Reserve System, Comptroller Of The Currency, Comptroller Of The Currency Office, Currency Board, Department Of The Treasury, Deposit Insurance Corporation, Facing Foreclosure, Fannie Mae, Fannie Mae And Freddie Mac, Federal Deposit Insurance, Federal Deposit Insurance Corporation, Federal Reserve System, Freddie Mac, Hardship Letter, Home Loan Mortgage, Interim Final Rule, Loan Modification, loan-modification-ca, Mortgage Loan Modification, Mortgage Loans, Office Of The Comptroller Of The Currency, Office Of Thrift Supervision, Risk Weight

Attention California Homeowners-The Government’s Freddie Mac Relief Refinance Mortgage rules:

The governmenst main objective is to assit borrowers of Freddie Mac guaranteed, insured home loans, to keep their homes affordable and reduce foreclosures by keeping payments affordable. Under Freddie Mac’s Home Affordable Refinance program, known as the Relief Refinance Mortgage, the program may be used to reduce the borrower’s loan interest rate, shorten the loan term repayment period or replace an adjustable-rate mortgage, interest-only mortgage or balloon/reset mortgage with a fixed-rate loan.

How to qualify for the new refinance program, first the borrower must have an existing mortgage that is owned or guaranteed by Freddie Mac. To find out whether Freddie Mac owns or guarantees your loan, call (800) 373-3343, call your loan servicer or search for your loan on Freddie Mac’s Web site at Freddie Mac.org.

You should contact your original lender or loan servicer to apply for this program.

The property may be a vacation/second home if the existing mortgage was originated as a second-home loan or the borrower now occupies the home as a principal residence.

The new Freddie Mac Refinance mortgage can be a 15-, 20- or 30-year, fixed-rate loan or an adjustable-rate mortgage  with an initial term of five, seven or 10 years. The loan must be fully amortizing (i.e., not an interest-only or payment-option loan).

If you have an existing fixed-rate mortgage, than the lender can not refinance with an ” ARM”  Adjustable Rate Mortgage.

The loan, may be a so-called “super-conforming” loan limit within the applicable loan limit for the area.

The property may be an investment property if the existing mortgage was originated as an investment property or the borrower now occupies the home as a principal residence.
 
If the original loan is covered by mortgage insurance, the insurer must agree to transfer the insurance to the new loan.

The new loan cannot be used to make a payment on or pay off a second loan.

Lenders are encouraged to use Freddie Mac’s automated valuation model, or AVM, to estimate the property’s current market value. Borrowers should ask whether a new appraisal will be required.

The borrower may be able to finance transaction costs of up to $2,500.
Borrowers whose monthly payment increases 20 percent or more must provide income and employment documentation and have an acceptable credit score and debt-to-income ratio to demonstrate they can afford the new higher payment.

If your loan does not meet these qualifications and you can not qualify for a typical refinance program,  You may want to consider modifying your home loan with a loan modification Ca mortgage program.  This will allow you to lower your monthly mortgage payments, lower your current interest rate on your mortgage, or possibly reduce the principal balance of your home loan mortgage.

More information can be obtained at the Freddie Mae web site or at the Home affordable modification webs site.

Publisher- Michael Kench Uncategorized Adjustable Rate Mortgage, Arm Adjustable Rate Mortgage, Avoiding Foreclosure, Balloon Mortgage, California Homeowners, Conforming Loan Limit, Existing Mortgage, Fixed Rate Loan, Fixed Rate Mortgage, Freddie Mac, Home Loans, Initial Term, Interest Only Mortgage, Loan Interest Rate, Loan Modification, Loan Servicer, loan-modification-ca, Main Objective, Mortgage Insurance, Mortgage Interest, Mortgage Loan Modification, Mortgage Mortgages, Payment Option, Principal Residence, Repayment Period, Year Fixed Rate Mortgage

Obama Refinance Plan and California Homeowners?
 
The federal government’s Home Affordable Refinance program is designed to help homeowners refinance their mortgages even if they owe slightly more than the current value of their homes, up to 105% of home to loan vaue. An example of this would be if your home was valued at $100,000  and your current loan amount was $105.000 then you could finance under this current program.  Most homeowners do not fit this scenarior, and some homeowners fall into a different category in which they may qualify for a loan modification Ca homeowners program. The new loan refinance program has several layers of rules to follow to qualify for a mortgage refinance program.  First there is a maze of special offers from different lenders.  Which is the best?  Each program has different qualifications, terms, incentives so you need to way each one accordingly.

The government refinance program is complicated because the federal government has their set of rules; Fannie Mae and Freddie Mac have their own separate sets of rules; and lenders, loan servicers and mortgage insurers generally have their own rules to follow through the refinance maze.  the sad part is that a majority of homeowners do not qualify for this program which was slated to help 5 million homeowners.  With the drastic decline in home values this program will fail many homeowners as the “Hope” for homeowners government plan failed.  If you are in a situation where you can not refinance, yo are having trouble making your monthly payments or you behind.  Then a home loan modification Ca homeowners may be the ticket for you.  The government is offering incentives to lenders to perform a loan modificatio on your mortgage loan. If your are in this situation take action now and see what your lender can do for you today.

Publisher- Michael Kench Uncategorized 5 Million, Avoiding Foreclosure, California Homeowners, Current Value, Drastic Decline, Fannie Mae, Fannie Mae And Freddie Mac, Federal Government, Freddie Mac, Government Plan, Home Loan, Home Values, Incentives, Lenders, Loan Modification, Loan Servicers, loan-modification-ca, Maze, Mortgage Insurers, Mortgage Loan, Mortgage Loan Modification, Mortgages, Special Offers

California Mortgage Mess

The current mortgage mess will lead to more bank failures, more foreclosures and a need for loan modification Ca homeowners programs to curtail the problems homeowners are facing in this real estate market.

Interesting facts- Mortgage finance giant Freddie Mac(Federal Home Loan Mortgage Corporation)  which was founded in 1970.  Fannie Mae (Federal National Mortgage Association), the 2 government-sponsored enterprises owned or guaranteed $5.3 trillion of mortgages (out of $10.5 trillion nationwide) as of 12/31/08. Freddie Mac lost more money during the 2 years of 2007-08 (a $53 billion loss) than it made during the 36 years from
1971-2006
($42 billion of profits) (source: USA Today, Wall Street Journal and Federal Reserve).
$2 trillion of mortgages were packaged together into bonds and sold to investors, i.e.,
they were securitized (source: Inside Mortgage Finance, Wall Street

And now the tax payers are paying the price.  Homeowners who were sold these toxic loans are paying the price with higher payments, facing default and foreclosure.  Those who have taken action to prevent them selves from going into foreclosure have done so by negotiating a loan modification Ca program on their mortgage loan. 

If your lender is unwilling to re-negotiate your mortgage loan than you may have to hire a professional to negotiate for you.  If, this is not an option you could consider a “Short Sale” on your home.  A Short Sale will still be negative on your credit but it is not as bad as a foreclosure.  And as a last result you could turn over the keys to the lender and do what is  called a “Deed In Lieu” of foreclosure.  If you go this option you should hire an attorney to protect your legal rights.  If you go the route of a loan modification be prepared before you attemp a loan modification so you can negotiate  a loan modification Ca program that will make the most sense today and down the road.

What ever you decide to do take action and don’t wait for the problem to go a way, because it will not.

Publisher- Michael Kench Uncategorized Bank Failures, California Mortgage, Current Mortgage, Deed In Lieu, Deed In Lieu Of Foreclosure, Fannie Mae, Federal Home Loan, Federal Home Loan Mortgage, Federal Home Loan Mortgage Corporation, Federal National Mortgage, Federal National Mortgage Association, Freddie Mac, Government Sponsored Enterprises, Home Loan Mortgage, Home Loan Mortgage Corporation, Loan Modification, loan-modification-ca, Mortgage Finance, Mortgage Loan Modification, National Mortgage Association, Usa Today, Wall Street Journal