Subprime Wolves are Howling About Mortgage Rates and the Fed Funds Rate Reduction

Yesterday’s reduction of the Federal Funds rate to a range of 0.000 to 0.250 percent is the lowest record level in history. This news is certainly in the minds of many consumers but, as also explained by Dan Green, it is for the wrong reasons!

Every time the Federal Reserve reduces interest rates, I hear radio and television personalities (i.e.: agents and broker) rambling about how “The Fed reduced rates today and that translates into lower mortgage rates so now you can refinance/buy with an even lower rate.” Well….they are either a lying to you with that sales pitch, they don’t know how mortgage rates work, or both.

Now, let’s look at how all these rates really work so you don’t have to rely on a wolf howling to refinance your home. Read more

December 17th, 2008 · Filed Under Mortgage - Loan Information

Comment 

What is a Loan Modification?

Loan modifications have been, for the most part, the long waited rescue plan for some homeowners who have fallen behind on their payments. Nonetheless, this is not the silver bullet for the foreclosure problems we are going through right now.

Contrary to what the so called “loan modification experts” may say, not everyone qualifies and not every lender is cooperating.

THE BASICS

To understand what a loan modification is, we need to first Read more

November 26th, 2008 · Filed Under Foreclosure-Short Sale Information, Mortgage - Loan Information

7 Comments 

US Financial Crisis: Whose Fault Is It Anyways?

Yesterday Henry Paulson, US Treasury Secretary, announced a plan to spend $250 billion to purchase stocks in at least nine major financial institutions. This money infusion would give taxpayers ownership stake on these banks and guarantee a 5% return. It would also help banks build more reserves and in turn ease lending to consumers and businesses alike, at least that is what we hope banks will do.

The Emergency Economic Stabilization Act of 2008 H.R. 1424 is known in Main Street as the “Wall Street bail out” plan. However, in Wall Street it is known as the “rescue” plan. Regardless of the name; many people Read more

October 15th, 2008 · Filed Under Foreclosure-Short Sale Information, Mortgage - Loan Information, Real Estate Information

1 Comment 

What is Your Code of Ethics?

Not too long ago “business ethics” was an expression that many considered an oxymoron. Then, in the 1990’s corporations made a remarkable turnabout by addressing codes of ethics, conduct issues in policy manuals, etc. The main reason was because businesses became increasingly concerned about ethics after realizing that ethical practices actually made business sense.

The rules of ethical behavior that govern businesses and Read more

September 12th, 2008 · Filed Under Foreclosure-Short Sale Information, Mortgage - Loan Information, Real Estate Information

Comment 

H.R. 3221 Housing and Economic Recovery Act of 2008 Passes New Permanent Loan Limits

The House passed the massive housing bill last Wednesday, the senate voted Saturday to send it to the president and today President Bush signed the “Housing and Economic Recovery Act of 2008 HR 3221.”

HR 3221 is intended to aid in stabilizing our economy, support first-time homeowners and provide mortgage relief for Read more

July 30th, 2008 · Filed Under Foreclosure-Short Sale Information, Mortgage - Loan Information, Real Estate Information

Comment 

Learning from Our Mistakes: Co-Signing Could Lead You into Financial Trouble!

Perhaps in the past you were in a situation where a close friend, a relative or even your own son asked for help in obtaining a mortgage loan, a credit card, a private loan, a student loan, a car loan, etc, etc by co-signing for them. And because of your good relationship with them or because you felt obligated to help them out, after all they are your family members, you agreed and put your financial future in jeopardy.

Statistically speaking, co-signers have a very high chance of Read more

June 12th, 2008 · Filed Under Mortgage - Loan Information

Comment 

Federal Reserve Rate cuts: How Will It Impact You and Your Money?

Yesterday, December 14, 2004….uuuhhh…wait…I meant yesterday March 18, 2008 the Federal Reserve lowered the Fed funds rate down 75 basis points to 2.25 percent. The reason why I mentioned December was because the last time the fed funds rate was this low was back in 2004 as you can see in the Federal Reserve Board: Monetary Policy, Open Market Operations chart.

I know you probably have read all the gloomy news in the newspapers, TV stations or perhaps you may have received calls from many mortgage brokers telling you that these great news will benefit you if you refinance now, but who is right and who is wrong?

Making the News

The truth of the matter is, Read more

March 19th, 2008 · Filed Under Credit Information, Mortgage - Loan Information

3 Comments 

New FHA and Conforming Loan Limits for California Released by HUD

Almost 1 month after the H.R. 5140 Economic Stimulus Package was signed by President Bush; the Office of Federal Housing Enterprise Oversight (OFHEO) released today the maximum temporary conforming loan limits.

The new FHA loan limits as well as Fannie/Freddie Government Sponsored Enterprise (GSE) loan limit will apply to loans originated between July 1, 2007 and December 31, 2008 for one, two, three and four unit homes as determined by the U.S. Department of Housing and Urban Development.

These great news will offer some hope to struggling homeowners in California, specially in Read more

March 6th, 2008 · Filed Under Mortgage - Loan Information

5 Comments 

H.R. 5140 Economic Stimulus Package passes New Conforming Loan limit

Although the Economic Stimulus Package was signed by President Bush yesterday, it could be a couple of months before the impact is felt in the mortgage markets. There are some kinks and details that still need to be worked out.

03/06/08 Update: New FHA & Conforming Loan limits for California released by HUD

If everything goes well, and it is expected that it will, rates for loans between $417,000 and the (temporary) new Fannie Mae’s and Freddie Mac’s conforming loan limit of $729,750 will be Read more

February 14th, 2008 · Filed Under Mortgage - Loan Information

6 Comments 

New Conforming Loan Limit and FHA Loan Limit Could help Californias

With the housing market already receiving a little help from the federal funds rate cut made during the inter-meeting a few days ago and another possible rate cut coming up; buyers and homeowners will possibly feel more willing to take the plunge and buy or refinance due to the Economic Stimulus Package of 2008.

 2/14/08 Update: H.R. 5140 Economic Stimulus Package signed by Presiden Bush raises Conforming Loan limit 

3/06/08 Update: New FHA & Conforming Loan Limit for California released by HUD 

Yesterday the House of Representatives signed off on Read more

January 25th, 2008 · Filed Under Keeping an Eye on the Market, Mortgage - Loan Information

2 Comments 

Interest Rates may Drop Lower

The Federal Reserve, in an effort to avoid a recession, surprisingly made an inter-meeting rate cut to the federal funds rate. This latest rate cut left the federal funds rate at 3.5 percent.

The next meeting, on January 29-30, is their formal meeting and it is expected Read more

January 22nd, 2008 · Filed Under Keeping an Eye on the Market, Mortgage - Loan Information

1 Comment 

I will Personally call You when Interest Rates Go Down!….Say What??

Recently a couple that had been dealing with another mortgage broker for a refinance in San Jose, contacted me because they did not feel very comfortable with him. The reason of their discomfort was the way the mortgage broker was pressuring them to obtain a loan he assured them would be the best choice.

I turns out this mortgage broker was pressuring the homeowners to refinance their home into an Option ARM loan also known as the Negative Amortization loan. He vaguely offered them Read more

January 2nd, 2008 · Filed Under Mortgage - Loan Information, Real Estate & Mortgage FRAUD

Comment 

FHA Modernization Act of 2007 passed by the Senate

Today’s news is that the Senate passed the FHA Modernization Act of 2007. Now, this bill will be debated in Congress then review by President Bush for approval.

FHA was created during the Depression to stimulate the housing market at the time when homeownership simply wasn’t a reality for most people, today it looks to aid homeowners who have fallen victims to the subprime crisis.

The FHA Modernization Act of 2007 would: Read more

December 14th, 2007 · Filed Under Mortgage - Loan Information

1 Comment 

Mortgage Rate Freeze Looks to Aid SOME Struggling Homeowners

Gov. Arnold Schwarzenegger announced on Tuesday November 20, 2007 a deal with four major subprime lenders Countrywide, GMAC, Litton and HomeEq. A deal that would freeze adjustable interest rates for California homeowners struggling with ARMs resetting to higher mortgage payments.

And today the Bush administration announced Read more

December 6th, 2007 · Filed Under Foreclosure-Short Sale Information, Mortgage - Loan Information

2 Comments 

Opportunity to Improve Home Affordability in California Remains Unchanged

Everyone one of us that live in California know that we live in a high priced home state. “California has the third highest home price in the nation” said California Association of Realtors President William E. Brown. And although we have seen home values drop in most areas, this has only helped a miniscule number of buyers obtain their first home.

Today’s U.S. median home price is at $221,000 in comparison to Read more

November 30th, 2007 · Filed Under Mortgage - Loan Information, Real Estate Information

1 Comment 

Over the Top Incentives for Buyers in Today’s Real Estate Market

If you are looking to buy a home today, you pretty much know that there are bargains almost in every corner. You as a buyer have the upper hand because there are many homes to choose from. Homes from sellers who simply are looking to move out of the area, others desperate to sell before their ARM loan adjusts and others because they are about to loose their home in Foreclosure and are trying to sell it as a Short Sale.

In addition to benefiting from the increase of inventory in homes for sale, you may also benefit pretty soon from Read more

November 2nd, 2007 · Filed Under Mortgage - Loan Information, Real Estate Information

Comment 

Taxing Short Sales and Foreclosures

It is surprising to many that one can loose a home by selling it as a short sale or letting the bank foreclose on it and still be liable for payment of income tax on the amount the lender lost during the transaction (Read the: “Homeowner’s Guide: Short Sales and Preventing Foreclosure“)

Two types of income can result from a foreclosure or short sale: Read more

November 1st, 2007 · Filed Under Foreclosure-Short Sale Information, Mortgage - Loan Information, Real Estate Information

4 Comments 

Federal Reserve Cuts Rates Even More

The Federal Reserve faced with a slowing housing market and other factors, cut the federal funds rate to 4.5% this Wednesday. This is the second rate cut this year in an effort to bring more positive activity to the economy and it also aims to keep our country from going into a recession.

Consumer with Home Equity Lines will benefit because Read more

October 31st, 2007 · Filed Under Mortgage - Loan Information

1 Comment 

A Homeowner’s guide: Short Sales and preventing Foreclosure Pt2 (Alternatives to selling)

The solutions

If you are in similar situations as mentioned on my previous post, there are some steps that you should take before refinancing. The first thing you should do is (*if you have enough time*) repair your credit (beware of credit repair companies). Next, calculate if you have built enough equity to benefit from the refinance. If you credit is in good shape and you have built enough equity you will most likely be able to either maintain or lower you payment after you have refinanced. Great! What a relief right?

If you cant repair your credit (beware of credit repair companies) in time to refinance or if you have already missed some payments due to Read more

September 17th, 2007 · Filed Under Foreclosure-Short Sale Information, Mortgage - Loan Information

10 Comments 

Warning Signs for Recognizing Predatory Lending

Just like in any other profession not all mortgage brokers and lenders practice business fairly and ethically. Some of these mortgage brokers and lenders typically takes advantage of vulnerable groups, such as immigrants, people of color, seniors and people with disabilities who are applying to purchase homes or refinance home loans.

Consumers are protected by federal and state laws. Unfortunately, these abuses are Read more

August 29th, 2007 · Filed Under Mortgage - Loan Information, Real Estate & Mortgage FRAUD

3 Comments 

Older Posts →