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Home buying : Most affordable in decades

Helen Rivard — Tue, 21 Feb 2012 04:45:38 +0000

CNNMoney

According to the National Association of Home Builders/Wells Fargo Housing Opportunity Index, 75.9 percent of all new and existing homes sold during the fourth quarter 2011 could have been comfortably purchased by families earning the national median income of $64,200.

Read the full story:
http://money.cnn.com/2012/02/15/real_estate/housing_affordability/index.htm?hpt=hp_t3

State AGs, feds reach $25 billion mortgage settlement

Helen Rivard — Fri, 17 Feb 2012 03:40:47 +0000

Last Thursday, the nation’s five largest mortgage servicers agreed to a landmark $25 billion settlement with a coalition of state attorneys general and federal agencies. The settlement addresses past mortgage loan servicing, foreclosure abuses and fraud, provides substantial financial relief to borrowers harmed by bank fraud, and establishes significant new homeowner protections for the future.
The joint state-federal group announced the agreement with the nation’s five largest servicers: Bank of America Corporation, JPMorgan Chase & Co., Wells Fargo & Company, Citigroup, Inc., and Ally Financial, Inc. (formerly GMAC). Collectively, the five banks service nearly 60 percent of the nation’s mortgages.
Under the agreement, the five servicers agree to:
Commit a minimum of $17 billion directly to borrowers through a series of national homeowner relief effort options, including principal reduction. Servicers will likely provide up to an estimated $32 billion in direct homeowner relief.
Commit $3 billion to an underwater mortgage refinancing program.
Pay $5 billion to the states and federal government ($4.25 billion to the states and $750 million to the federal government).
Provide homeowners with comprehensive new protections from new mortgage loan servicing and foreclosure standards.
Additionally,
An independent monitor will ensure mortgage servicer compliance.
States can pursue civil claims outside of the agreement including securitization claims as well as criminal cases.
Borrowers and investors can pursue individual, institutional or class action cases regardless of agreement.
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Foreclosures at the high end increase

Helen Rivard — Tue, 14 Feb 2012 00:02:11 +0000

The Mercury News
The housing crisis has caught up with people whose wealth helped them hang onto their houses longer.
Read the full story:
http://www.mercurynews.com/business/ci_19899224

Home prices decreased 4.7 percent in 2011

Helen Rivard — Fri, 10 Feb 2012 01:03:24 +0000

CoreLogic’s December Home Price Index (HPI®) report shows that, including distressed sales, home prices in the U.S. decreased 4.7 percent in 2011 compared with December 2010. The year-end report shows that home prices continued the trend of year-end decreases. 2011 was the fifth consecutive year with a decrease in the HPI. The HPI, excluding distressed sales, shows that home prices decreased by 0.9 percent in 2011, giving an indication of the impact of distressed sales on home prices in 2011.

The five states with the largest peak-to-current declines including distressed transactions are Nevada (-60.0 percent), Arizona (-51.9 percent), Florida (-50 percent), Michigan (-43.7 percent), and California (-43.5 percent).

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A reprieve for unemployed borrowers

Helen Rivard — Tue, 07 Feb 2012 00:39:49 +0000

The New York Times

Fannie Mae and Freddie Mac recently extended their foreclosure forbearance programs to give short-term aid to unemployed homeowners, but housing counselors warn that these borrowers will need to look at longer-term solutions.

Making sense of the story

In a forbearance program, a lender agrees not to foreclose on a property and gives the borrower several months’ grace from or reduction in monthly mortgage payments. The programs work best for temporary setbacks, like job loss, health problems, or natural disasters.
There are drawbacks to the forbearances though. The most-significant drawback is a larger total debt from the smaller payments. The unpaid balance continues to increase during this time.
The new temporary mortgage payment is often set to 31 percent of the household income; in some cases lenders agree to accept no payments. Fannie Mae’s extended unemployment program, first offered in the fall of 2010, limits any nonpayment or other forbearance plans to one year, with the second six months requiring approval by both Fannie Mae and the lender.
However, even with the program in place, the lender could still report a mortgage as delinquent, which could adversely affect the borrower’s credit score.
Because some agreements add onerous term and conditions, homeowners should also consult with a housing counselor certified by the Dept. of Housing and Urban Development.

Read the full story
http://www.nytimes.com/2012/01/22/realestate/mortgages-a-reprieve-for-unemployed-borrowers.html?_r=1&ref=realestate