Skip to comments.Regulator throws lifeline to underwater borrowers (BHO= overlord in chief)
Posted on 10/24/2011 11:43:44 AM PDT by STARWISE
U.S. homeowners who owe more than their properties are worth got new help on Monday when a U.S. regulator expanded a government program in a step that could help up to one million borrowers.
The Federal Housing Finance Agency, which oversees mortgage finance giants Fannie Mae and Freddie Mac, eased the terms of a refinancing program which helps so-called underwater borrowers who have been on time with payments but are unable to refinance.
FHFA said it was scrapping a cap that prohibited borrowers whose mortgages exceeded 125 percent of their property's value from participating in the Home Affordable Refinance Program (HARP), which is targeted at loans backed by Fannie Mae and Freddie Mac.
(Excerpt) Read more at reuters.com ...
Winning Republican Candidate Campaign:
“I will overturn every manadate and regulation this DICTATOR IN CHIEF imposed on the American people!”
My candidate has already said he would eliminate the EPA. That sold me on him!
Regulator, White House to Expand Refinancing Program
A housing regulator and the Obama administration on Monday are set to unveil a major revamp of a home loan refinancing program aiming to enroll hundreds of thousands of borrowers whose homes have declined in value.
Note how they’re creating this whole new term, ‘regulator,’ when these are the un-REGULATED Obama czars .. UNconfirmed by Congress, UNanswerable to ANYone, except their emperor, and completely UNConstitutional.
WHO’S GOING TO STAND UP FROM OUR SIDE AND CALL FOR ACTION?
(Exception to my previous ping policy comment .. THIS IS BEYOND REVULSION!!)
how do Fannie Mae and Freddie Mac get all this new money ?
I think the solution is to link all of my posts to the CNN crawl, so all of the liberals can see them.....
I have been patiently waiting for prices to get down to true market so that I can buy a retirement home.
Are they going to keep the prices artificially high and then have me pay for them?
People that don't have jobs are sitting in homes they can't afford, meanwhile I am waiting to buy a home for cash.
Are they going to keep inflating the economy to make my savings worthless in order to protect the banksters?
How much more lipstick can they put on these pigs?
Why would they want to be bailed out and have to start making house payments again?
A family friend who lost his job filed the papers for Obama’s HAMP program to modify their mortgage payment FOUR times because the bureaucrats claimed they had lost them. The process was hopelessly tangled, and one day, the Sheriff came to post a notice of eviction because their bank had sold the mortgage to Fannie Mae. The government finally found something they could handle.
Losing their home was very traumatic for their young children.
When one of them asked me who had taken their home, their parents truthfully replied, “The government in Washington D.C.” Think of the millions of children who will never trust the government after their homes have been taken from them. They will never believe the lie, “I’m from the government, and I’m here to help you.”
Third World Contract Law from a Third World President.
If Fannie and Freddie have sold an MBS that includes a mortgage, (1)what happens to that MBS if they allow that mortgage to be refinanced, and, (2)because the refinanced rate/and or principle is expected to be lower, who takes the “haircut” - the holders of the MBS or the already deficit ridden Freddie and Fannie - in other words us?
These “programs” are a government mill to pretend there’s an intent to help.
There is no intent to acutally help anyone!
Taking from the rich (e.g., taxpayers) and giving to the poor (e.g., non-taxpayers who were able to buy houses because of government requirements).
We're being raped and we're supposed to smile and enjoy it???
Government interference in markets is never a good thing. Such interference leads to false demand signals and price distortions. The artificially high prices that then led to people being underwater after the bubble burst was caused by government interference in the market. Interfering again a second time is not going to help matters. The result of making/taking a bad loan on a bad foundation is that both the lender and the borrower need to take the financial hit for it, clearing the bad debt from the system.
As PUGACHEV indicated this is only for loans where clear title interest is known (ie. loan retained by originator) ,,, which excludes all RMBS related loans... this will only apply to a very small number of loans , namely those originated by local credit unions and such. The RMBS related properties are a real problem as the owners cannot be found due to the Wall Street banks that are acting in either a position as the syndicaor or trustee are blocking security investor access to loan level data.
Can I get some government money to help out?
It's only fair...
Actually I think what this does is tell all the banks that if they foreclose now the tax payers will pick up the tab. It appears to be a way to bail out the banks. It also sounds very similar to what Newt was talking about on Greta a few nights back.
If a loan is foreclosed on under this program, is your credit ruined? It shouldn’t be since the tax payers will be footing the bill.
With that said, I will take advantage of this if the numbers work out.
What happens if the economy hits take a nose dive again and housing prices drop another 20% in already underwater housing markets?
Would you loan your next door neighbor 125% of the house value at 4% for 30 years?
“If the homeowner is current at a high interest rate, why would there be an increased risk of default (and hence the government having to pay on their guarantee) if the payments were lowered? (2) The money the homeowner saves can be (a) taxed, as there is less mortgage interest to deduct, and that not taxed can be (b) spent or saved.”
So this is a “rescue” of those least in apparent need of a “rescue” at the moment.
And yes there will be a “cost” to this - someone (Fannie, Freddie, the loan originator) were expecting to get X on the income from the interest rate, and for a capitalized loan amount of Y and now someone must take a haircut on one or both of those things under this program, no?
Because if it is only a matter of private lenders offering to privately offer new mortgages on these properties, using that new mortgage to pay-off in full what is owed to the original lender, whether Freddie, Fannie or another private lender, then why is there any government intervention needed at all? Unless, there is a cost (a haircut to someone) and the government is agreeing to subsidies it?
If I am right, then this program is a wasteful interference.
The housing market will begin to right itself AFTER the jobs market begins to right itself, not before. Housing is not the first, or the key thing to “fix”, job creation outside of housing is the critical job sector that needs to FIRST come up. Housing will follow as jobs and incomes rise. Leave it alone meanwhile. The artificial stimulus measures throw false signals to the housing market and slows it from obtaining the bottom it needs to get to, to unwind the balloon that was created by all the years of false stimulus.