In February of 2009, President Obama announced the Home Affordability and Stability Plan (HASP). The plan was broken down into three main initiatives: 1)a “low-cost” refinancing program “that will help as many as 4 to 5 million responsible homeowners”; 2)a “stability initiative” designed to modify millions of home loans; 3)a “strengthening” of Fannie Mae and Freddie Mac.

Let’s see here: the touted refi program — HARP — is fading into the sunset (no one even talks about that program anymore — how many homeowners have even used this, does anyone know?), and Fannie and Freddie’s future has been shrouded in a cloud of uncertainty. The GSEs have recently been extended an unlimited amount of taxpayer dollars, suggesting that their future losses will be even steeper than the $400 billion they were originally promised.

Read the rest of this entry »

It’s no secret that the Obama Administration feels that mortgage lenders and servicers aren’t doing enough to help those facing foreclosure.

After enduring months of criticism on their lack of production, 25 mortgage-servicing companies came to Washington to tell their side of the story and offer some suggestions on how to make the process better. Whatever explanations or suggestions were offered, they obviously weren’t good enough (emphasis added):

The Obama administration wants to shame the mortgage industry into doing a better job of helping borrowers avoid losing their homes to foreclosure.

Read the rest of this entry »

Our friend HASP — the Housing Affordability and Stability Plan — is back in the news. We’ve written a fair amount about HASP, and it’s safe to say that we’ve been largely underwhelmed (see here, here, and here). We didn’t see much point in bailing out irresponsible homeowners for taking on too much debt.

Now we find ourselves even more unimpressed as our tax money will help bail out irresponsible homeowners with second mortgages as well:

Read the rest of this entry »

A visitor to HSH.com submitted a question yesterday regarding Washington’s latest plan to improve the housing market.

Question: In the April 1 edition of “Bottom Line” you refer to the “Homeowner Affordability and Stability Plan”. How can I avail myself of the plan?

HSH Vice President Keith Gumbinger wrote a three-page feature in the April 1 edition of the periodical ‘Bottom Line Personal’ titled “Mortgage Rescue Plan — How You Can Benefit.” Here’s an edited version: Read the rest of this entry »

Most of us are familiar with the high default rate that accompanies a large percentage of modified mortgage loans, but you may not have heard about the growing number of “zero pay” defaults on mortgages insured by the Federal Housing Administration. A “zero pay” defaults occurs when a borrowers fails to make even one payment on their loan. While the occurrence seems unlikely, it’s a growing concern that has many industry officials worried:

In the past year alone, the number of borrowers who failed to make more than a single payment before defaulting on FHA-backed mortgages has nearly tripled, far outpacing the agency’s overall growth in new loans, according to a Washington Post analysis of federal data.

Read the rest of this entry »

The numbers are in. During its first five months in operation, Hope for Homeowners (H4H) — a program slated to help 400,000 homeowners avoid foreclosure — has officially only helped one. Yes you read that correct, one:

“As it stands now, we’ve only gotten 752 applications,” said Federal Housing Authority spokesman Brian Sullivan. “And only insured one loan. Needless to say, the program isn’t working terribly well.”

Read the rest of this entry »

As subscribers of our weekly Market Trends newsletter know, we run a three-question survey which we run two to three weeks to gauge what our readers think of whatever topic we think is interesting.

The most recent survey — which began three weeks ago but runs through Sunday night, so there’s still time for you to chime in — asked our readers what they thought about the recently-unveiled “Homeowner Affordability and Stability Plan.”

Read the rest of this entry »

As our readers probably know, an important component of the new HASP program is to offer as many as five million “responsible” homeowners the opportunity to refinance their home loans. An important point to remember about this, however, is that it applies only to ‘conforming’ mortgages — those which are owned by Fannie Mae or Freddie Mac. The plan allows refinancing up to a current balance of $729,750 (the “expanded conforming” amount which was put in place last year and renewed this year).

However, there is one key difference: borrowers with loans owned by Freddie Mac won’t be able to comparison shop among lenders to find one with lower rates and fees. That restriction does not apply to Fannie Mae-owned loans:

Read the rest of this entry »

Update1 (02/02/10): This post has received a lot of comments from readers who are frustrated over the lack of communication between borrower and servicers. The Treasury recently made some mandatory changes to HAMP that are designed to improve servicer-borrower communications.

Click here to read our post titled “Changes to HAMP: Docs Required Upfront,” and share your experience by leaving us a comment.

Read the rest of this entry »

We’ve already written about HASP, the Obama administration’s latest salvo in his campaign to stem the growing tide of foreclosures, but now that it’s up and running here’s a quick review.

The program has set several ambitious goals. First, it is intended to enable as many as five million “responsible” homeowners to refinance their home loans. (Attendant to this is the goal of “supporting low mortgage rates.”)

Read the rest of this entry »