“Fanny and Freddie in particular accelerated their imprudent behavior after they, we attempted to regulate them.” That comment by Karl Rove is the key to the crisis that caused all of our economic troubles that we face today. Without Fanny Mae and Freddie Mac buying up all of those risky mortgages, they would never have been made. The Banks would not have risked their own financial futures covering risky loans like the ones they were enticed to make.
The question is why did Fanny and Freddie accelerate their loan buying? Could it be that they wanted to line their pockets with money at the risk of the tax payer? Fanny and Freddie were, are, government backed entities that did not, do not, take on any risk. Therefore there is no real accountability; they do as they please at the taxpayers expense.
So you see this entire mess was caused by the government, not our capitalist economy. And now the government is back at it with this so called stimulus package. Have they not done enough harm to our Economy? Do they want to destroy our economy to the extent that every man, woman, and child has to come begging to our government for a handout; is that their goal?
jbranstetter04
Guess again who’s to blame for U.S. mortgage meltdown
Analysts point not to greed, but to social activist politics
While many pundits are pointing to corporate greed and a lack of government regulation as the cause for the American mortgage
and financial crisis, some analysts are saying it wasn’t too little government intervention that cased the mortgage meltdown, but too much, in the form of activists compelling the government to pressure Freddie Mac and Fannie Mae into unsound though politically correct lending practices.
“Home mortgages
have been a political piñata for many decades,” writes Stan J. Liebowitz, economics professor at the University of Texas at Dallas, in a chapter of his forthcoming book, Housing America: Building out of a Crisis.
Liebowitz puts forward an explanation that he admits is “not consistent with the nasty-subprime-lender hypothesis currently considered to be the cause of the mortgage meltdown.”
In a nutshell, Liebowitz contends that the federal government over the last 20 years pushed the mortgage industry so hard to get minority homeownership up, that it undermined the country’s financial foundation to achieve its goal.
“In an attempt to increase homeownership, particularly by minorities and the less affluent, an attack on underwriting standards was undertaken by virtually every branch of the government since the early 1990s,” Liebowitz writes. “The decline in mortgage underwriting standards was universally praised as ‘innovation’ in mortgage lending by regulators, academic specialists, (government-sponsored enterprises) and housing activists.”
He continues, “Although a seemingly noble goal, the tool chosen to achieve this goal was one that endangered the entire mortgage enterprise.”
“As homeownership rates increased there was self-congratulation all around,” Liebowitz writes. “The community of regulators, academic specialists, and housing activists all reveled in the increase in homeownership.”
An article in the Los Angeles Times from the late ’90s praised the sudden surge in homeownership among minorities, calling it “one of the hidden success stories of the Clinton era.”
John Lott, a senior research scientist at the University of Maryland, however, claimed in a Fox News article yesterday that the success came at a great price.
According to Lott, the Federal Reserve Bank of Boston produced a manual in the early ’90s that warned mortgage lenders to no longer deny urban and lower-income minority applicants on such “outdated” criteria as credit history, down payment or employment income.
Furthermore, claims Lott, Fannie Mae and Freddie Mac encouraged and praised lenders like Countrywide and Bear Stearns for adopting the slackened policies toward minority applicants.
“Given these lending practices mandated by the Fed and encouraged by Fannie Mae and Freddie Mac,” writes Lott, “the resulting financial problems for financial institutions such as Countrywide and Bear Stearns are not too surprising.”
http://www.worldnetdaily.com/index.php?fa=PAGE.view&pageId=75717
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Mortgage Modification – Home Loan Modification Process – How to Plan for Federal Laws, Credit Rules and Hardship Letter Requirements — News and Help on Attorney Negotiated Bailout Package – Real Estate Foreclosure Scams and Bankruptcy Prevention – http://realestatemarketingthisweek.com/real-estate/congressman-barney-frank-is-calling-for-the-restructure-of-the-loan-servicing-business/ – Congressman Barney Frank is calling for the restructure of the loan servicing business – RealEstateMarketingThisWeek.com
Part 2 – Well, in the past we have talked a lot about loan modifications and since the first time we started talking about loan modifications the whole space has changed. Everything about loan modifications since our very first broadcast talking about it, we don’t talk about it every week, but we do talk about it allot. It has changed so much, when we started anybody who had a significant hardship, or financial hardship, or had one of these toxic mortgages, that had adjusted, would be able to qualify for a loan modification. These things have changed all of a sudden, and not all across the board. Brett you made a comment earlier that people are concerned that once these servicers do these modifications they could be subject to lawsuits right?
Yes, it is amazing how quickly things have changed over the course of the last couple of weeks, it seems this information, and this news is changing almost hour by hour, at this point one of the things that came out regarding this mortgage modification program is from Barney Frank, “Congress should act to restructure the servicing of home mortgages.” So the idea is that they are catching on to something that you and your team at velocity financial were ahead of the curve on in terms of loan modifications.
Knowing that those rules for a hardship and why you are entitled to one have definitely changed. Now it is more of a situation where in order to stop foreclosure, to stop the problems associated with this mass foreclosure market place, modifications are being talked about amongst the banks now. Barney Franks comments today, he stressed how these voluntary inducements to get these private entities to protect homeowners from the government has fallen short, and Hank Paulson has fallen short of putting their weight behind this concept.
Although I personally believe that is the next evolution of this. Loan Modifications are a critical step for people who are feeling this economic crisis, and for people who want to stay in a home, for people who need this type of assistance. The idea is you have a short window of opportunity here before something else significant changes where you may no longer be entitled to.
You heard Citigroup, you know this we talked about it, Citigroup came out and made the announcement that they were going to suspend their pursuit of foreclosures in certain areas of the country that have the highest unemployment rate, that was the caveat. We will see how big the scope of that gets, but the whole idea is for you as a mortgage owner, as a home owner with a mortgage, if you need to establish a modification to an existing loan, in order to have more favorable terms in interest, a more favorable monthly payment, a way to keep that home, you have to look at this option.
Yes, and I appreciate you saying that one of the things that Citigroup announced they were going to be doing was giving people teaser rates of 1%. Look anybody with a brain can realize that that is ludicrous. What got us into this situation in the first place was huge banks, just like that one, giving people toxic mortgages, with fake interest rates, and pick your own payment, do whatever the heck you want to. It is exactly what they are trying to do again.
Essentially what they are talking about is giving people a short window of a very low interest rate, but they are going to be back in the same situation in the future. That’s why the loan modifications that we do, that we hire on your behalf, the national network of attorney’s that we use. We go for the throat, we are not looking to get you a 1% interest rate for the next 12 months. We are looking to get you a lifelong, or for the term of the loan if possible, the very lowest interest rate available, and fix it or extend the term so you can actually sustain that payment well beyond the short term.
One thing I want to point out before we have to go to a break, if you know of anyone out there, that has a GMAC mortgage, whether it be a GMAC first mortgage or second mortgage, you have got to tune in to the second segment you are not going to believe this scam that’s out there, going against people with these loans… http://realestatemarketingthisweek.com
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Reverse Mortgage is something, which can enable an individual to withdraw the cash from the bank in lump sum. You will find a number of banks available where one can utilize for the same. But before jumping into any choice concerning the Home loan one ought to make sure that the place is safe and reputed.
To apply for Reverse Mortgage a single should fulfill particular problems. One needs to fill in an application form with information like age of the borrower, interest rate, and loan fees etc. Individuals can utilize for that exact same not only by visiting the banks, one may also log on to online websites and utilize for the same.
This type of Home loan is lucrative and won’t affect the borrower’s ability to collect social security and pension benefits. People can take Reverse Mortgage loans to pay for home repairs, taxes, insurance payments, medical bills and so on. this Home loan is of different types.
Before applying one requirements to do a lot of home function i.e. investigation function, that may include talking to a financial experts, going via bank literatures and so on. A single needs to become careful and clear concerning the terms and conditions involved in Reverse Mortgage as any type of carelessness can lead to issue.
Reverse Mortgage loan enables the individuals to take loan from lenders in lump sum without having much difficulty. The good point about this home loan is that the borrower still remains the owner from the house just like he was when he had a forward home loan. Before creating any decisions one ought to usually do proper research work about the financial institution, the loan kinds, rate of Interest
Before making any decision about Reverse Mortgage, like arkansas reverse mortgage, it’s really essential on the part from the borrower to become well aware of his ability to pay back the amount he has borrowed. People can apply for that exact same for education, house, car and other purposes. Loan is something which individuals need to payback that too within fixed period of time.
People ought to usually utilize for that Reverse Mortgage loans from great and secure banks! Thus a single ought to always browse around to discover the very best location. A single can discover out about such financial programs not only by visiting numerous banks, but also by taking the help of Internet. Apart from one may also take the help of Mortgage lenders or even the Brokers as they can provide details about such monetary programs!
People with bad financial history may not be eligible for obtaining Reverse Mortgage loan nevertheless good places could be an exception. After choosing the correct bank and also the loan one requirements fill within the registration form offered by the banking institutions. Individuals require to show documents and papers, and fulfill certain criteria to borrow the money. One could payback the amount either together or in installments. Great places don’t want your home but require the repayment!
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This is a recent homebuyers seminar I put together in Daly City, California. If you would like information about further seminars, please let me know at jvetter@mercurylending.com. I can help you with you California and Oregon refinance and purchase needs.
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Robert Floris discusses second mortgages.
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Mortgage payment calculations formula
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Mortgage business owner Kyle Dawson present a seminar on theTop Ten Mistakes People Make Getting a Home Loan (excerpts).
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http://www.burnellhall.com, United First Financial – MMA or Money Merge Account – Early Mortgage payoff, Mortgage early payoff, Early Home Loan Payoff, Reduced Loan, Loan Reduction, be debt free, first time home buyer, 40 year mortgages, Jumbo Home Loan, Mortgage Rescue Plan – Create Your Own Bail Out
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http://realestatemarketingthisweek.com/real-estate/b-of-a-and-countrywide-pay-150m-fine-for-deceptive-mortgage-practices/ – B of A and Countrywide pay $150M fine for deceptive mortgage practices –
Part 8 – I have here in my hand something from the office of the attorney general Terry Goddard, this is in regard to B of A and Countrywide. The state has alleged that prior to 2008 that Countrywide used unfair and deceptive tactics in its loan originating and servicing activity and placed borrowers in structurally unfair and unaffordable loans. These are not my words folks this is from the office of Terry Goddard the Attorney General of Arizona
They are talking about lowering peoples rates for the first year only. Look a good loan modification, you dont need a 12 month reprieve if you are 2, 3, or 4 months behind on your mortgage, it is going to take a little bit more than 12 months to get back on your feet.
I was going to say what an important point that you are making is because the announcement today by Paulson regarding the money not being used to buy these bad mortgages any longer, because of Barney Franks comments about how banks need to do more to help avoid foreclosures for mortgagees, what that really is amounting to for me as someone who studies the financial marketplace every single day as part of my profession, what that really amounts to is banks being able to set terms, and the short term reprieves, and the importance of what you are doing right now is critical for people to understand.
You are ahead of the curve, you go to the bank for these modification purposes, you take the proactive steps to make the terms suitable for you, my point is if the bank, by Terry Goddards letter, already has asserted that they have made some type of poor judgment in the way that they treated their mortgagees or the people that they gave loans to, why would you then go back to that bank as the owner of that mortgage and try to negotiate with them on your own? Why then would you have the trust in them that it was going to work to your best possible out come? I find that to be absurd.
You are absolutely right; they have essentially admitted to it, they have a $150,000,000 settlement. I just want to throw one more thing out there, they have a $150,000,000 bill that they have to pay because, according to the Attorney General, deceptive business practices, a hundred and fifty million dollar check that they have to write, somebody is going to have to make that up.
And that is a good point, the point of this would be to take this action yourself prior to these banking institutions making the decisions on your behalf, theyve already done this, they have already made those decisions on your behalf, whether or not you knew exactly what type of loan program you were getting involved with when you took out the loan and all of that.
If you find yourself in a position of not being able to maintain your existing mortgage payment under the terms that you have been issued by the bank, modification is something you should consider, you make the terms going forward, you should use the professional expertise and the negotiating abilities of these attorneys that specialize in this area and make this work for you before the rules are placed at your feet yet again.
We talk about people doing this on there own, what I see being the problem is they are going to send you out a packet of paperwork, maybe email it to you or fax it. I have seen the paperwork that they send out, it is more than 36 pages of legalese, once it goes back it is going to sit in front of the loss mitigation department in a stack, Ive seen the stacks, literally thousands of cases sitting there waiting to be reviewed by someone who may very well not be qualified to make a real decision, in my opinion using the loss mitigation department at the bank you may be dealing with a clerk that was answering sales calls for someone else two months ago.
Versus going to the legal department and dealing with those individuals directly. There is no doubt you absolutely have to use professionals, you need to put your head on the pillow and turn this over to somebody who knows what they are doing, an expert negotiator, a paid attorney that does this for a living, put your head on your pillow and keep your family safe in your home… http://RealEstateMarketingThisWeek.com
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A reverse mortgage can be an appealing option for numerous home-owning seniors which are having a difficult time making ends meet. Having a reverse mortgage, a senior homeowner will receive money for their house equity from a loan company without having having to make repayments for as lengthy as they live in their home. So with the correct reverse mortgage a senior home owner can preserve their regular of living while retaining ownership of their home.
This of course, is the picture that all the reverse mortgage businesses attempt to paint for prospective borrowers. Nonetheless, there are lots of distinctions that have to be understood between reverse mortgage’s and traditional loans. If these distinctions aren’t understood, they can cause financial difficulties for reverse mortgage borrowers.
Reverse Mortgage Disadvantages
The very first disadvantage is the relative cost of a reverse mortgage. Reverse mortgages often be really expensive when compared with a conventional home loan. This is due to the rising-debt nature of reverse mortgages. For instance, a typical reverse mortgage might supply a home owner with a $300 per month payment with a yearly curiosity rate of 12 percent compounded monthly. Over the course of ten many years, the home owner will receive $36,000 in obligations, but will owe nearly $70,000-almost twice as much as acquired.
The second problem may be the complex and confusing contracts of change mortgages, that may have a tremendous effect about the general price of a reverse mortgage towards the borrower. The complexity of the contracts frequently permit lenders and third parties involved in arranging reverse mortgages to not fully disclose the loan’s terms or costs. These several other front-end and/or back-end fees can also quickly drive up the price of the reverse mortgage. These costs can consist of origination costs, points, mortgage insurance premiums, closing costs, servicing fees, shared equity and contributed appreciation costs.
Out of all these costs, the shared equity and contributed appreciation costs should be avoided, as they are able to rapidly raise the price with the home loan without having providing any advantage towards the borrowers. As an example, a contributed appreciation charge can give a loan company an automatic 50% curiosity within the difference between the present value of the home when the loan is signed and also the appreciated value of the home once the loan is terminated. What makes the fees unfair is the fees have no relation towards the quantity that is borrowed.
The third problem is the reverse home loan payments can have an effect on eligibility for old age pensions, Medicaid, or supplemental Social Security income. Senior’s might not even understand this issue till following they already have their reverse mortgage, and only then do they find out that this can have the opposite affect on a seniors finances then what they had been trying to achieve in the first location by getting out the reverse mortgage.
An additional problem is the truth that reverse mortgages reduce the value of the senior’s assets and estate. This will have an effect on the amount of inheritance acquired through the borrower’s heirs.
How to avoid these dangers
The very best way for a senior to prevent these dangers is to be cautious when selecting a loan company, by obtaining bids from 3 separate lenders. They should take these contracts to a reverse mortgage counselor for evaluation. This can permit them to accurately evaluate the three contracts before deciding on best one for their circumstances.
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