100,000 File For Bankruptcy
In October more than 100,000 consumers filed for bankruptcy protection, a 40% increase from the year before. Total filings for the year are on track to exceed 1.1 million, according to Sam Gerdano, the president of the American Bankruptcy Institute.
Exceeding the 1 million benchmark is significant because it was that level of filings that prompted lenders to start lobbying for the bankruptcy changes that went into effect in October 2005.
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New Relief Program For Homeowners at Risk of Foreclosure
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Real Estate – An Innovative Way of Not Filing Bankruptcy
Second Home Foreclosure Tax Penalty
Home Mortgage Foreclosure Scams
Business bankruptcies spike
New Relief Program For Homeowners at Risk of Foreclosure
Effective December 15, Fannie Mae and Freddie Mac the government-controlled mortgage underwriters, are sponsoring various relief plans for homeowners at risk of foreclosure.
Fannie and Freddie hold almost 60 percent of all U.S. mortgages. With this kind of reach, the new programs should have a real impact. Government officials said the program said it wasn't likely to stem the housing downturn on its own, but said it could help hundreds of thousands of homeowners. Plus, banks will receive an $800 fee for every loan that is reworked.
Like most homeowner relief plans, there are requirements that borrowers must meet to qualify:
- Be at least three months behind on their mortgage payments
- Owe the bank at least 90 percent of what the home is worth
- Live in the home as a primary residence
- Not be in bankruptcy
- Be able to prove that they're not just trying to skip out on the loan
- Loan must have been written before Jan. 1, 2008
- Loan must be held by Fannie or Freddie, or investors agreeing to participate.
Lenders will adjust interest and the length of the mortgage — extending them up to 40 years — and even principal to bring payments within 38% of the household gross income of the homeowner. The principal will still be owed, but it won't accrue interest.
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Goverment’s FHASecure Refinances 200,000th Mortgage
183,000 Homeowners Get Help To Stay In Their Homes
Real Estate Subprime Mortgage Five-Year ARM Freeze Announced
Real Estate – An Innovative Way of Not Filing Bankruptcy
The Federal Housing Administration announced FHASecure, a temporary initiative to permit lenders to refinance delinquent adjustable rate mortgages (ARMs) and/or to offer new subordinate financing where the combined loan-to-value ratio exceeds the applicable FHA loan-to-value ratio and geographical maximum mortgage amount.
The FHASecure Eligibility Criteria
Borrowers Current on Their Mortgages
The mortgage being refinanced must be a non-FHA fixed rate or adjustable rate mortgage. Cash out refinances are not acceptable.
If there is insufficient equity in the home, FHA will insure first mortgages where there is a:
1) Write Down. The existing note holder(s) writes off the amount of indebtedness that cannot be refinanced into the FHA insured mortgage (a short pay-off); or
2) New Subordinate Financing. The FHA-approved lender making the new mortgage, the existing note holder or other interested party may take back a second lien by the amount which the payoff is short, including closing costs, arrearages, other reasonable and customary costs that are standard servicing practices and are included in all payoff statements or previous secondary financing if the indebtedness exceeds FHA prescribed LTV and maximum mortgage amount limits; and/or
3) Re-subordination/Modification. The note holder(s) of existing subordinate financing must re-subordinate or modify the existing subordinate lien(s) and re-execute at closing if the lien is to remain in effect after closing.
Borrowers Delinquent on Their Mortgages
How FHASecure Can Help:
The borrower's payment history shows no more than one 60-day late payment or two 30-day late payments.
If the borrower is unable to meet the payment history requirements specified above, the lender may still proceed with the refinance transaction provided that the loan-to-value ratio on the new FHA-insured mortgage does not exceed 90 percent and the borrower has no more than one 90-day late or no more than three 30-day late payments over the 12 month period prior to the rate reset or extenuating circumstance.
An Innovative Way of Not Filing Bankruptcy
****Resources of FHASecure can be located at www.hud.gov