Mr.P, Other/Just Looking in Arizona

WARNING THIS IS NOT INTENDED TO BE A POLITICAL DEBATE. Please don`t go there.

Asked by Mr.P, Arizona Fri Aug 31, 2007

The Bush administration today rolled out a plan officials said was geared at helping up to 700,000 homeowners avoid foreclosure in the next two years, but which is not intended as a bailout of mortgage lenders who are facing mounting losses on bad loans.

The plan gives the Federal Housing Administration the authority to insure loans for delinquent borrowers facing foreclosure. Administration officials said the new "FHASecure" program will allow FHA to guarantee an additional 60,000 refinance loans a year.

Because borrowers pay premiums on FHA mortgage insurance, the program is expected to pay for itself and can be implemented immediately as an administrative action.

"We will enact it today, but it will probably be Tuesday (before the program goes into effect) given the long weekend," a senior Housing and Urban Development official speaking on background told reporters in a conference call today.

WHAT DO YOU THINK

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11
Mike Kelly A…, Agent, Santa Rosa, CA
Fri Aug 31, 2007
I think this is a band-aid on a paitient facing multi-amputees. We went through this during the S&L crisis back in the late 80's. We took the drastic but needed steps of creating the RTC(Resolution Trust Corportation) which gathered all the property secured by the then paltry savings of the S&L's and revaled them all and then sold the whole lot. I belive I still have one of the first RTC catalogs(imagine the yellow pages of New York City!!). What this wholesale sell off of these assets provided was value to an otherwise unknow commodity. Sound familiar? But this time out it is the huge "tranches" of loans held by the big boys of Wall Street. This, in the words of columnist Lou Barnes, is all about credit-not liquidity. Once you find out what eveyone owns then you can sell them off and get on with the business of restoring confidence in the loans we don't sell to Fannie Mae/Freddie Mac or are insured by FHA. And I don't mean to be political but we also have the "Road Home Program" in the south which is supposed to aid Katrina victims. Been to the hard hit areas of the south lately? Lastly, here in "bubble-land" or the "Coasts" as they are called, we have properties that are not just upside down $10,000 or $20,000 but $50,000, $100,000, $150,000! Do we write completely new loans on these properies and have the government pay-off the difference to the lender? Does the government enact special tax foregiveness for the debt relief issues? When the S&L's went belly -up and then we had the subsequent market "correction" of the early 90's, politicians excalimed we can't let this happen again! But here we are once more. And once this hiccup is ironed out and everyone, except the consumer, is bailed out, they'll do it all over again!!
4 votes
Mr.P, , Arizona
Tue Sep 18, 2007
Thanks ED,
I like a fool went to a Government website, It is incredible that the FHA.gov site moves so slow , I am serious. I wanted to know what the FHA Secure limits were. NO answer.
However I found a head line that said
How do I find a real estate professional?
Hmm that`s interesting.
So I followed the link
It lead me to HOMEGAIN!
Here`s the link see for your self http://www.fha.gov/buyer/prof.cfm#2
My tax dollars are getting Homegain a referral fee
Great....Somebody tase me now!
2 votes
#1, , San Francisco Bay Area
Tue Sep 18, 2007
Christian... mom is correct.

Listen to mom. She has been through this. She is a wealth of information.

Love what you have and embrace it.
2 votes
Silvia Miceli, Agent, Toms River, NJ
Fri Aug 31, 2007
I think this is proof that the problem is perhaps larger than many thought. Hopefully , this will be help many of the homeowners facing foreclosure in the near future. Unfortunately, for many it is too late. I think they spoke about instituting changes in guidelines to prevent similar lending practices in the future. Specially with regards to clearer disclosures on behalf of lenders. The fine print. Pre-payment penalties, and variable rates that many consumers perhaps may not grasp (thinking the rates won't rise that quickly) or were not brought to buyers attention. If it will help consumers in the future, it may be a good thing. It happens more than we think where Sellers show up at a closing and find out they have to pay a $10,000 penalty for having pre-paid an equity line of credit. They thought it was paid. Not realizing that there would be a penalty.
2 votes
Ute Ferdig -…, Agent, New Castle, DE
Fri Aug 31, 2007
I guess what I would like to know is how they'll ensure that those in trouble will benefit from the program. While refinancing may help some, I think it will only slow down the train. Many of the borrowers who are facing foreclosure, will probably not be able to take advantage of the program either because they don't have the money to pay for the cost of refinancing or because their credit has suffered too much to qualify for a decent loan. I'd be interested in knowing more about this.
2 votes
Greg Kiely, Agent, Newton, MA
Fri Aug 31, 2007
think the move is a good step in the right direction. I am not a huge fan of the Fed making major monetary policy changes and think making the FHA more accessible is nothing but a benefit to all homeowners. We will weather this storm, and I know Boston is seeing one of it's strongest seasons EVER! - A
2 votes
Christian Gr…, , Fairhope, AL
Tue Sep 18, 2007
I commend you for asking the question.

In Baldwin County, Alabama, we are seeing new homes sit for months without a real buyer to be found. We experienced a huge housing increase in 2005 and 2006 which forced the prices up for existing homes & new construction. Now our homeowners can't get what they paid for them and can't sell them at any price. Our area has a decade or more of inventory according to an independent study.

My mother, a 28 year real estate veteran, has told me that it will not turn our market around any time soon. She was in the business when interest rates were 17% but they still had buyers. We do not have any buyers now and this is a first for her. Mom knows best!
1 vote
#1, , San Francisco Bay Area
Fri Aug 31, 2007
I actually think it was a great post.

Ed
1 vote
Silvia Miceli, Agent, Toms River, NJ
Wed Sep 19, 2007
Hi Patrick & Ed,

I clicked on the link and I see what you mean. I sometimes tend to be a little naive. I have to tell you I received an e-mail from Realtor.com about certain legislation being passed yesterday. I checked the press releases button on the FHA website that Patrick provided and the last posting was from Sept 5 th, I think. The e-mail I received had this in it "the House of Representatives today passed, H.R. 1852, the Expanding American Homeownership Act of 2007, by a vote of 348-72. It is meant to increase the limits, etc. I do not know by how much or if it is going to help. Still I was surprised how many times I saw the word Realtor on the main screen.
0 votes
#1, , San Francisco Bay Area
Tue Sep 18, 2007
Yeah... somehome I am into tasers these days... that's what you meant... right?

FHA loan limit in Alameda County is $280,000. Who is that going to help in Alameda County?

Brian Innman is a nice man.... but regardless to popular opinion... he is in it for the money.

Just like all of us. Those of us who are 10 - 20 year veterans are no longer here to do this for practice!

We've had plenty of practice.
0 votes
#1, , San Francisco Bay Area
Tue Sep 18, 2007
Hey Patrick...

I think that in light of what has happened since you started this thing it is now a political debate... so let's get the party started!
0 votes
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