Archive for June, 2009

I have a former co-worker of mine who just shared her story with me about her loan that was modified. I have talked to many people about loan modifications and it seems that they “know someone who knows someone” who got their principal cut or rate lowered by an amazing amount. I heard this story first hand and thought I should share it with everyone that I know. I think we all know people who are in a similar situation with an adjustable rate mortgage…

Here is her story:

• loan is with Citibank, was an interest only loan that would adjust in 2011
• stopped making payments in November 2008
• wrote a letter about her situation as soon as she stopped making payments
• sent in the paperwork they requested
• kept calling and made notes every time she called. Talked to people in Loss Mitigation Department

How the lender modified her loan (after 8 months):

• tacked on missed payments to the end of loan
• adjusted mortgage from 30 year to 40 year
• changed interest rate to 2.875 for first year, 3.875 for second year, and 4.875 for 3rd year and beyond

With this said, she did not get her principal reduced but, she is now in a payment that she can afford. She did not have to pay a loan modification company but did have to have patience and determination. She is no longer worrying about her loan adjusting. She mentioned to me that it helped that she did everything in writing instead of just calling the bank.

I hope this gives some of you hope .

There is mortgage insurance now available for first time buyers through the California Association of Realtors. This insurance is FREE for the first year. The qualifications are as follows:

• must be a first time buyer (have not owned a home in the last 3 years)
• open escrow after April 2nd, 2009
• must be represented by a California Realtor in the transaction and you must provide documentation to prove this

• you (and all other co-buyers on the Property Purchase Contract) must own no other real property during

  the escrow period on the Property Purchase Contract, whether as a sole owner or jointly;

• you have not previously received an Insurance Policy from Housing Affordability Fund; and

• you must meet all of the eligibility requirements set forth by the insurance carrier to receive an Insurance Policy.

The great thing about this program is that there are no income limits! For the full application, please click here.

If I can help anyone you know with purchasing a home and taking advantage of all the opportunities this market has to offer, please let me know.

On June 13th a new foreclosure rule was announced that has to do with  California Foreclosure Prevention Act, passed as Assembly Bill X2 7 by lawmakers in February and signed by Gov. Arnold Schwarzenegger.

The main points of this bill are:

• The law will largely press lenders to follow the Obama administration’s Making Home Affordable Program that began in March. That encourages lenders to cut interest rates or rewrite loans to 40-year terms to get payments below 38 percent of a borrower’s monthly income. Other options include reducing principal and tacking missed payments to the back of the loan. Under the law, California officials also can encourage short sales or deeds in lieu – options in which banks accept less than owed – for borrowers who want to leave or don’t qualify for modifications.
• adds 90 days to the foreclosure process for those banks that don’t comply with loan modification efforts

In summary, here’s what started on June 15th., 2009:

• Lenders will submit applications to the state outlining their loan modification programs. That gives them a 30-day exemption from a moratorium.

• If the state OKs a lender’s program, the firm is permanently exempt from the 90-day delay on foreclosures.

• If the state rejects the program as inadequate, a lender has 30 days to upgrade it and be reconsidered.

Consumers should be able to see a list of lenders that comply with the state’s requirements by mid-July.

For the full article from SacBee.com click here

New Foreclosure Timeline per new Civil Code:

For any questions, please contact me at . I am here as a resource for you, your family and friends. Things are changing often in this market and I want to help my clients by delivering informational news as often as possible.