Saturday
“Despise HAMP? Your servicer does too“:
Homeowners and government watchdogs agree: The much-vaunted Home Affordable Modification Program (HAMP) has so far been a failure. Likewise, the mortgage servicing companies charged with implementing the program aren’t too happy with it either. But do servicers’ complaints have merit? Or are they improperly and deliberately denying HAMP claims?
Friday
Nationally-syndicated columnist Peter G. Miller writes, “Fixing the mortgage system is crucial if we’re to prevent another financial meltdown.”
Miller offers six steps to fix the system; six steps that he says can be done starting this week. Let us take a look at a few:
Second, lending rules must be changed so that loan officers have a fiduciary obligation to borrowers, in the same way that lawyers have an obligation to clients and doctors have an obligation to patients. The creation of a fiduciary obligation for loan officers would mean that aggrieved borrowers could take loan officers and their lenders to court in the event of abuse, a system which seems to work well for virtually every other type of business.
There’s a significant divide between those at the Federal Housing Administration (FHA) and its critics over how the FHA can improve their fiscal situation and the housing market as a whole.
To balance both their struggles and success in the market, the FHA announced “a set of policy changes” back in January that were designed to both strengthen their shaky capital reserves, and to enable the administration to aid in housing’s recovery. For the most part, the changes amounted to an increase in the up-front mortgage insurance premium (MIP).
“Striking the right balance between managing the FHA’s risk, continuing to provide access to underserved communities, and supporting the nation’s economic recovery is critically important,” said Commissioner [David] Stevens.
While we try to publish about five new articles each week on HSH.com, last week’s snow storm put a little crimp in our schedule. The result: twice as many articles published this week on HSH.com.
Let’s take a look at the fresh content on our home page:
A relatively recent test may make it appear that way, yet we’re not so sure that’s the case.
All reverse mortgage counselors are required by HUD to pass a licensing test that is proving extremely difficult, even for many seasoned veterans:
“The test is intentionally difficult, but we believe it needs to be so because of the vulnerable population” who seek out reverse mortgages, a HUD spokesman told the Post and Courier. HUD made the licensing exam more difficult after numerous complaints that people who were providing counseling about reverse loans were not always well-informed.
The Federal Housing Administration (FHA) has found themselves launched to the forefront of the housing industry. With a relatively-new commanding presence in the housing market, the FHA has simultaneously encountered struggles and success. To balance the two, the FHA announced “a set of policy changes” designed to both strengthen their shaky capital reserves, and to enable the administration to aid in housing’s recovery.
“Striking the right balance between managing the FHA’s risk, continuing to provide access to underserved communities, and supporting the nation’s economic recovery is critically important,” said Commissioner [David] Stevens.
HUD Secretary Shaun Donovan testified today before the House Committee on Financial Services to explain the new measures that will implemented in order to better promote the Federal Housing Administration’s solvency (FHA) moving forward.
Earlier this year, we warned that the FHA could be the next taxpayer bailout, and we also noted that the FHA could quickly turn into the next subprime lender. Yet, today on Capitol Hill, Secretary Donovan said the FHA is neither. These new measures, according to Donovan, “will be focusing primarily on three areas: enforcement, improving the quality and sustainability of new loans insured by FHA, and increasing FHA capital.”
It’s as bad as many thought. The results of the Federal Housing Administration’s (FHA) annual independent audit were released yesterday after being delayed for about a week. The Federal mortgage insurer’s cash reserves have fallen to 0.53%, well below the 2% limit set by Congress.
If you’re a regular reader of this blog you’ll know that we’ve been documenting the FHA’s troubles for most of the year, and have at times referred to them as “The New Subprime,” and the probable recipient of the “Next Taxpayer Bailout.”
Finally!
We’ve read over a couple articles and blog posts today about the FHA’s new, stricter guideline for their streamline refinance program, due to go into effect next week. The advice from mortgage brokers is to submit your refi application A.S.A.P. in order to take advantage of the “old” requirements. Beginning on November 17, 2009, it’s going to get tougher for homeowners to refinance under the FHA’s streamline program. To that, we say “it’s about time.”
An FHA streamline refi allows existing FHA borrowers to refinance into a new FHA loan with limited terms and conditions to make the process easier.
UPDATE6: It’s a done deal. President Obama signed the “Worker, Homeownership and Business Assistance Act of 2009″ which institutes an extension and an expansion of the homebuyer tax credit.
The tax credit, which was due to expire on December 1, 2009, will allow first-time buyers to claim 10% of their home’s cost, up to $8,000. Buyers must sign their contract by April 30, 2010 and close by June 30, 2010 to qualify: Read the rest of this entry »
HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.
