Equity Talks

How lenders interpret the loan modification guidelines and how to develop your modification budget strategy. The key to a successful loan modification boils down to math. Different banks also interpret these guidelines differently. The main problem homeowners have in applying themselves is not knowing these rules. So get your budget out and work up your numbers. Drill them into your head and be prepared to deliver supporting documents every month that match your strategy if you expect to succeed. After the hardship letter As I have stated in previous posts, the number one qualification to apply for a loan modification must be financial hardship which has impacted your ability to meet your current payments using this Debt to Income test. These factors may be temporary or permanent so the hardship affidavit (letter) is your starting point, followed by your budget analysis. Regardless of whether you are applying for a HAMP, MHA or HARP or private  bank program;  they all share one foc

If, like many Americans, you would like to know who actually owns your mortgage, write a letter to your bank and interested parties requesting this information. Which Bank? Just because Bank X is on your mortgage statement that does not mean they actually own your loan. They are the 'servicer'. Which means they collect your monies, take their fee and send the rest to the parties who own it. Since ownership changes the servicer may also change or may just keep track of where to send the money. If Fannie Mae or Freddie Mac are the 'owners' of your loan, it is possible that a Mutual Fund or pension fund in Norway could be 'fractional owners' of your loan. One investor usually holds the note. It is rare these days that your local bank you may have gone to for a loan, actually owns your mortgage. The speed with which loans were packaged and sold on Wall Street into traunches of Mortgage Backed Securities (which were then traded and and retraded) is why ownership

If you cannot afford your current financial commitments it may be time to get professional help. Below are some guidelines and resources:   The loss of their home's value has caught many people off guard. Even folks with good jobs and modest 80% LTV (loan amount to home value) now find their value may have dropped 20% or more in the last two or three years. As mortgage professionals, we have many resources, but we are not magicians! Fortunately, the same guidelines that lenders apply to mortgage lending (which we must know backwards and forwards) also apply to your new situation, although they are applied differently - you'll see how below. It is extremely and painfully obvious to banks that many homeowners simply would not now qualify for the same loan they now hold. Your mortgage balance represents their interest in your property -- which may now be greater than what the collateral (your home) is worth. So essentially you and your bank are both in trouble. So what do you

Homeowners who have suffered a Short Sale or Foreclosure are advised to develop a recovery strategy from the day you decide to negotiate your settlement terms with your bank. The fact you have failed on a financial obligation, on the face of it, is an agreement to move forward with you life. Congratulations. Take a deep breath! You may be able to qualify for an FHA home loan as your fastest track back to homeownership sooner than later. FHA currently has no minimum credit score, although most lenders do have their own underwriting overlays on what they will accept. 620 FICO is the starting point for most. What about timing? The clock starts ticking in your favor the day your home title is transferred to a new owner. NOT unfortunately, the date your foreclosure is registered. Since Short Sales keep you on title throughout the process, you could be putting off home ownership however long it takes to settle your sale. If you were able to keep making your payments or miraculously did

Should this home be 'saved'? I read a wake up article today by a mortgage market advisor  Mark Hanson , who suggested that unless foreclosures double from the April 2010 record, the 'shadow inventory' of homes on the market --it will take at least 8-10 years to clear the sales backlog of homes for sale. Wow. Which suggests, by deduction, that our national housing markets will be affected by these lower priced distressed homes lagging if not languishing on the market beside new and non distressed homes, affecting their values for years. OK so that's the downside. But for every dark cloud there is a silver lining...right? What is the real effect of foreclosures in your local market? Are people who don't need to sell helping stabilize their local economies by staying put regardless of their paper 'losses' in value? Mr. Hanson goes on to suggest:  "Massive-scale home retention (mortgage mod) programs have truly helped only a small slice but primari

Principal Writedowns + Help for Unemployed Homeowners: HAMP and Making Home Affordable Guidelines updated today are sounding pretty progressive: The much touted PR on Principal Write downs is being implemented by the first subscribers to this. If the idea of lowering your loan balance has any goodguy points be aware that citizens will be paying for this via more bailout funds or taxes. Supporting the collective good is after all what our democracy stands for. Which Banks?  Unfortunately, the major banks still standing have inherited many bad loans: Pay Option ARMS, and assorted Sub Prime loans i.e., loans famous for exploding one's principal balance or rate and payment when they adjust. Many of these loans were sold to people who simply did not understand ther terms or qualify for the full principal and interest payments. To the embarassment of some brokers and banks, these loans financed a rash of predictable defaults. So what is a lender holding so many bad loans to do? The