Source: http://www.marketwatch.com/story/nearly-800000-fewer-properties-underwater-2013-12-17?link=MW_latest_news
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WASHINGTON (MarketWatch) -- In the third quarter, 791,000 more residential properties have returned to positive equity, CoreLogic said Tuesday. That still leaves nearly 6.4 million homes, or 13% of properties with a mortgage, that are in negative equity. Nevada had the highest percentage of mortgaged properties in negative equity at 32.2%, followed by Florida (28.8%), Arizona (22.5%), Ohio (18.0%) and Georgia (17.8%), CoreLogic said. Negative equity, often referred to as "underwater" or "upside down," means that borrowers owe more on their mortgages than their homes are worth.
Source: http://www.marketwatch.com/story/nearly-800000-fewer-properties-underwater-2013-12-17?link=MW_latest_news Follow me:
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Lenders would get a new incentive to modify New York homeowners' underwater loans, under a proposal to be announced Tuesday by state officials. Mortgage lenders could reduce the amount owed on the loans, in exchange for the right to share in the sale profits if the homes eventually rise in value, administration officials said. Previously, state regulations didn't allow such arrangements. The initiative "will help keep more families in their homes and out of foreclosure, while at the same time reducing potential losses for investors," Gov. Andrew M. Cuomo said in a statement. "That's good for homeowners, good for local neighborhoods, and good for the long-term strength of the housing market." DATA: Explore home values, ownership rates | Search for homes on Long Island | List your property TOOLS: Estimate the value of your home | Find research on LI communities Under current federal rules, the majority of home loans in New York would not qualify for the program, because Fannie Mae and Freddie Mac -- the mortgage giants that buy roughly two-thirds of home loans in the state -- do not forgive outstanding mortgage balances. However, the U.S. Senate is expected to vote as soon as Tuesday on a nominee to head the regulator overseeing the mortgage giants. The nominee, Mel Watt, is reportedly open to the idea of forgiving portions of mortgage principal. The proposed state program would be open to homeowners owing more than their homes' value, and who have been turned down for loan modification. Banks would be required to make clear disclosures to homeowners about terms of the modified loans, and banks' share of profits would be limited to either half the gain in home value, or the total amount forgiven, whichever is less, said Benjamin Lawsky, superintendent of the state Department of Financial Services. Reactions to the proposal were mixed Monday. "If the homeowners could get out from being underwater it would give them a wonderful incentive . . . to keep paying their mortgage," Karen Ferrare, an attorney in Westbury who works with homeowners in foreclosure. However, an economist who has studied "shared appreciation mortgages" said the proposal faces stumbling blocks. It's unlikely that banks would embark on such a program if it is not adopted nationwide, with many changes to federal and state rules, said Andrew Caplin, a New York University professor of economics. And it's unclear whether loan modifications would result in higher taxes for homeowners, he said. The program would apply primarily to loans serviced by banks, not mortgage banks, since mortgage banks typically do not hold loans on their own books and do not have enough capital to buy the loans back, said Michael McHugh, chairman of the Empire State Mortgage Bankers Association and chief executive of Continental Home Loans in Melville. Getting a loan reduction "would be helpful," said Victor Alexander Osorio, who said he owes $360,000 on his primary mortgage on a Baldwin home that he estimates is worth less than $310,000. But he expressed reluctance at giving up price appreciation to banks that got government bailouts during the financial crisis.More details about the proposed change will be posted at www.dfs.ny.gov. The proposal will be open for public comment for 45 days. Source: http://www.newsday.com/classifieds/real-estate/proposal-would-modify-underwater-mortgages-in-ny-1.6573677 Follow me: As of 2015, lenders must clearly explain interest rates, payments, closing costs
Home buyers baffled by the details of their mortgage — the largest financial commitment many of them will ever make — will be getting help from new federal rules that aim to make the loan easier to understand. The "Know Before You Owe" rules, issued last week, will take effect on Aug. 1, 2015. They will require lenders to give borrowers two forms — one shortly after applying for a loan, one three days before closing — that will use plain language to explain the interest rate, monthly payments and closing costs. The rules were issued by the federal Consumer Financial Protection Bureau in response to the housing crash, which resulted in many borrowers defaulting on their mortgage loans. The CFPB says that with better disclosure, borrowers would have been better prepared to avoid risky loans. The new rules replace 30-year-old rules requiring that lenders give borrowers Truth in Lending statements and an HUD-1 uniform settlement statement. The CFPB said that in tests, consumers found the new forms easier to understand and more helpful in figuring out whether they can afford a mortgage. When exotic mortgages were being written during the housing boom, homeowners often unknowingly got into toxic loans, according to Phyllis Salowe-Kaye, head of New Jersey Citizen Action, the state's largest housing counseling agency. She said struggling homeowners were surprised to find that their interest rate was set to jump, or that they owed a large balloon payment after several years. "A lot of people never knew it was even in their mortgage," she said. "People had no idea." Allen Susser, a real estate lawyer in Saddle Brook, said current mortgage disclosures can be "terribly confusing," but said he was skeptical that the new disclosures would explain matters any better. Dave Stein, chief operating officer of Residential Home Funding in Parsippany, also said that while it's a good idea to clarify mortgage disclosures, previous efforts to do that have not been very successful. And he said consumers must do more to educate themselves. "I know they always have the consumer's best interest in mind, but consumers often don't take the time to understand it," he said. He and Susser said the requirement that borrowers get the documents three days before closing could delay closings. Read more: http://www.northjersey.com/news/233265291_New_rules_aim_to_make_mortgages_clearer.html Follow me: James Clooney WS James Clooney Site James Clooney on Gather James Clooney - Listal James Clooney Blog James Clooney | WordPress James Clooney on Quora Jim Clooney Twitter Page James Clooney Mortgage Jim Clooney Mortgages Fewer U.S. homeowners are falling behind on their mortgage payments, aided by rising home values, low interest rates and stable job gains.
The trend brought down the national late-payment rate on home loans in the third quarter to a five-year low, credit reporting agency TransUnion said Tuesday. The percentage of mortgage holders at least two months behind on their payments fell in the July-September quarter to 4.09 percent from a revised 5.33 percent a year earlier, according to the firm, whose data go back to 1992. The latest rate also declined from 4.32 percent in the second quarter. The last time the mortgage delinquency rate was lower was the third quarter of 2008. Within a few years of setting that mark, foreclosures began to mount as home values tumbled from housing-boom highs, leaving many homeowners in negative equity — owing more on their mortgage than the value of their home. The dynamic drove mortgage delinquencies higher, peaking at nearly 7 percent in the fourth quarter of 2009. The rate of late payments on home loans has been steadily declining over the past five quarters. At the same time, U.S. home sales and prices have been rebounding over the past two years, while foreclosures have been declining. Moderate but stable job gains, still-low mortgage interest rates, and tight supply of homes for sale have helped fuel the housing rebound. That's also made it easier for homeowners to refinance, catch up on payments or sell their home, avoiding foreclosure. Even so, the mortgage delinquency rate is still above the 1 to 2 percent average historical range. That suggests that many homeowners still are struggling to make their payments. It also reflects that many home loans made during the housing boom remain unpaid but have yet to work their way through the foreclosure process. Loans made in the years after the housing boom are generally being paid on time, so as more of the older loans listed on banks' books as unpaid get resolved, the overall mortgage delinquency rate should continue to decline, said Tim Martin, group vice president of U.S Housing for TransUnion's financial services business unit. "The new mortgages are still performing very well, at very low delinquency rates," Martin said. "That's why we're expecting more improvement to come." TransUnion forecasts that the national mortgage delinquency rate will drop to just under 4 percent by the end of year. All the states posted an annual drop in late-payment rates during the third quarter, with California, Nevada, Arizona, Colorado and Utah registering declines of more than 30 percent. TransUnion draws its data from 52 million installment-based mortgages in the U.S. Source: www.abcnews.go.com/US/wireStory/late-payment-rate-mortgages-3q-20858939 Follow me: |