Home Mortgage Scandal
home foreclosures
Revelations about the sloppy home mortgage re-sale paperwork are emboldening homeowners and law enforcement officials in many states to question whether lenders rightfully hold the mortgage notes underlying foreclosed properties.
Distressed properties, many of which are in foreclosure, make up about a third of all home sales. Foreclosures are now going to slow to a crawl.
Now, Fannie Mae has been sending e-mails to real estate agents about putting off deals and removing houses from the market.
Home Loan Originator Database
Mortgage shoppers can search the Nationwide Mortgage Licensing System Consumer Access and learn if the mortgage originator they are working with is licensed, has had disciplinary action, or, worse, has had his or her license revoked. The new database shows data for the previous 10 years, includes aliases, and searched all state, so disciplinary action in other jurisdictions or states is retrieved. See www.nmlsconsumeraccess.org/ for more information.
San Diego California downtown condominiums
FHA Home Loan Policy Changes
FHA home loans
FHA home loans
The new FHA policy changes are as follows:
1) Borrowers with less than 580 credit scores will be required to put 10% down instead of 3.5%.
2) Upfront mortgage insurance, MI, will increase to 2.25% from 1.75%.
3) The maximum seller contribution is now 3% rather than 6%.
4) Lenders will now be graded and performance reported. Lenders found violating FHA rules will no longer be allowed to make FHA loans.
To understand the reasons behind these changes, I would suggest one read my 9-20-09 post “FHA Home Loans in Worst Shape in 75 Year History” or my 12-16-08 post “FHA Home Loans – The Next Bailout?”
San Diego California real estate lawyers
New 2010 Home Mortgage Rules
home mortgage rules save cash
Federal rules now require mortgage lenders and brokers to give consumers better estimates of the costs they incur when taking out home loans, and mandate a standard three-page Good Faith Estimate that urges consumers to shop around for the best loan and helps them compare lenders’ offerings. The rules, announced by the Department of Housing and Urban Development in November 2008, are an update of the Real Estate Settlement Procedures Act, a 1974 law known as Respa. One difficulty of shopping for mortgages is that the lender with the lowest rates sometimes isn’t offering the best deal. High fees can wipe out the benefits of low rates, and little-noticed features such as prepayment penalties can burn borrowers. Read more 
Fannie Mae Hikes Mortgage Credit Scores
San Diego home
Fannie Mae has increased the minimum borrower credit score from 580 to 620.
Brian Faith, a spokesperson at Fannie, confirmed the minimum hike, adding that the adjustment reflects a careful analysis of borrowers ability to repay their mortgage obligations over the life of the loan. Our experience with recently delivered loans with credit scores below 620 is that they reached a level of serious delinquency at a rate approximately nine times higher than other acquisitions during the same period, Faith said in a statement. Read more
Home Mortgage Delinquencies Slow – But Still Hit Record
San Diego California
According to credit reporting agency TransUnion, for the three months ended Sept. 30, 6.25 percent of U.S. mortgage loans were 60 or more days past due.
The rate was up 7.6 percent from the second quarter. That’s a much smaller jump than the 11.3 percent rise in the second quarter from the first, and the 14 percent leap seen in the quarter before that.
Being two months behind is considered a first step toward foreclosure, because it’s so hard to catch up with payments at that point.