March 15, 2010
FHA Chief Warns Against Increasing Downpayments
Low downpayments make it easier for people to walk away from loans. Low downpayments were a key ingredient in all the fancy new mortgages that fueled the housing boom and then bust over the past eight years.
Read more on FHA Chief Warns Against Increasing Downpayments…
Filed under mortgage by Luke Ford
Only 170,000 have completed the paperwork, while 1.1 million home owners have begun the process.
The program is having a tiny impact on America's high rates of foreclosures.
Las Vegas is hard-hit by foreclosures but fewer than 4,000 homeowners have completed the paperwork for the program.
Read more on Over One Million Enroll In Obama's Mortgage Modification Scheme…
Filed under Banks, Foreclosure, Politics, mortgage by Luke Ford
February 25, 2010
Jumbo Mortgage Market Improves
Big expensive homes have been hard hit by the housing crisis.
Fannie Mae and Freddie Mac have limits on the expenses of homes whose mortgages they guarantee.
Some of those owning these expensive homes have been able to refinance to lower rates.
Filed under mortgage by Luke Ford
Why are banks getting blamed for not modifying more mortgages?
Why should they modify mortgages unless they believe it is in their self-interest?
What about the sanctity of contracts? People signed up for certain terms. If they can't live up to them, then they default and the bank forecloses.
Filed under Banks, Foreclosure, mortgage by Luke Ford
February 10, 2010
Low Demand For Mortgage Loans
How are you going to take out a mortgage loan if you don't have a job? Or you fearing losing your job? Or your hours and benefits are getting cut back.
Because they follow the dictates of politicians.
Politicians, be they Republicans or Democrats, saw increased home ownership as an absolute good. They ended up sacrificing our entire economy for this false god.
Filed under Banks, Politics, fannie mae, freddie mac, mortgage by Luke Ford
February 9, 2010
Low Rates For Those With Great Credit Scores
You keep hearing on the news about record low mortgage rates. But you're having a hard time getting a hold of those low rates for yourself.
Exactly who is taking advantage of these low rates?
About 11 million American households are underwater on their mortgage.
So why don't more Americans walk away?
That's the theme of about a dozen articles in the New York Times over the past month.
Filed under Banks, Foreclosure, mortgage by Luke Ford
Banks and businesses walk away all the time from bad investments. It's called cutting your losses.
Individuals? Not so much. They're scared. They're scared of defaulting. They fear it shows bad character. They fear the hit it will give to their credit rating. They've never defaulted on anything so massive in their life. Their fears override their rationality.
Read more on Too Scared To Walk Away From An Underwater Mortgage…
Filed under Banks, Foreclosure, mortgage by Luke Ford
I am amazed at how often people stay in underwater homes. They have a huge economic incentive to walk away but they feel a moral responsibility to pay off their mortgage, even when it is not in their self-interest.
Read more on Feeling Like A Sucker For Not Walking Away From An Underwater Home…
Filed under Banks, Foreclosure, mortgage by Luke Ford