Who Owns My Mortgage and Why Do I Need To Know?
January 1, 2012
Don’t be afraid to ask the customer service representative for your mortgage servicer who owns your mortgage. The owner, who is often referred to as the investor, might be different from the servicing company or bank that collects and processes your payments. Lenders often sell off the servicing rights, too. So it is very common for the owner and the servicer to be different entities. Many people don’t realize, if you have an issue concerning the terms of your note and mortgage you may need to contact the owner, and not the servicer. The owner has the final approval of any loan modifications or short sales approval terms. This can pose a huge problem because so many people have no idea who this man behind the curtain is controlling their fate. Two of the most common mortgage holders are Freddie Mac and Fannie Mae, however there are many more. If you are not sure who owns your mortgage there are a few links that can help you. You can start by checking to see if Freddie Mac or Fannie Mae own your mortgage. If neither Freddie or Fannie owns your mortgage, you can try searching the MERS servicer ID database for other investors. If you are still unable to determine who owns your loan, send a written request for the investor’s contact information to your mortgage servicer.  Â
Are Banks Dumping Short Sales For Less Lucrative Foreclosures?
September 11, 2011
Are banks purposely rejecting short sales in favor of less profitable foreclosures? Maybe so, but why? Some say it may be for reasons such as avoiding fraud or favorable accounting rules allowing banks to foreclose on a home without having to write down a loss until that home is sold as opposed marking the loss on short sales upon approval. However, if this is the case and the bank knows they have no intention of approving a short sale, why do they not only allow but encourage the seller to go through months of the process?
Each month  that a seller is delinquent further contributes to the decline of that seller’s credit. Banks require homeowners to be delinquent and they must be rejected for a modification prior to entering the short sale process. Then, banks take many months to process short sales, propose extremely high counter offers or frequently claim to lose documents that have already been submitted. The customer service workers often say they are poorly trained and can rarely answer any inquiries regarding short sale status. Upon receiving denial letters banks will not provide precise reasons or numbers. Sellers and buyers are left wondering how and why the home foreclosed.
Does any of this sound familiar to you? Are you a buyer or seller who has been through a similar scenario? If so, make your voice heard. The attached New York Times article is looking for your short sale stories.
Government to Decrease Financial Involvement in Freddie and Fannie
February 11, 2011
The Obama administration has announced a ‘winding down’ of financial involvement in Fannie Mae and Freddie Mac at an annual rate of no less than 10% per year. Timothy Geithner predicts it will take three years for the housing market to recover. Then, an additional two to three years for legislators to come to agreement on the government’s role in funding future loans. After an agreement is reached it should  result in new legislation. At this time, the three proposed ideas under consideration are:
1)Â Â Â Â Â private system - where lenders and investors fund new mortgages, with a limited subsidies for the poor and veterans.
2)     private system – where government is involved during market stress to guarantee home loans.
3)Â Â Â taxpayers would insure securities backed by home loans
Obama Administration Inconsistent On Mortgage Servicers
January 21, 2011
Earlier this week, Obama administration officials sharply criticized the mortgage servicing industry. However, just one day after Geithner and other officials had called for a revamp of the current system, Cindy Gertz the director of operations at the Treasury Department’s Homeownership Preservation Office, said tremendous progress has been made on the part of those same servicers. Although, Gertz, acknowledged that the process is not complete, she referred to the Making Home Affordable (MHA) program as having made great strides, even though only about 500,000 permanent loan modifications have been implemented as a result of that program.
Housing Regulators Plan New Fee System
January 19, 2011
U.S. housing regulators plan to impose a new fee system and standards for mortgage servicers by mid 2012. The Federal Housing Finance Agency instructed Fannie Mae and Freddie Mac to work with the Department of Housing and Urban Development in order to find ways to improve mortgage servicing for borrowers. They proposed imposing a service based fee structure for poorly performing loans in place of the flat rate added onto the borrower’s interest rate that is currently in use. In addition, the FDIC, Treasury and other agencies are expected to issue a proposed risk retention rule by next month requiring lenders to assume some of the financial burden of risky loans.
Bank of America Settles with Freddie and Fannie
January 7, 2011
Bank of America has settled with Freddie Mac and Fannie Mae for $2.8 billion to silence claims that the bank sold them faulty loans. Investors are typically entitled to repayment by the lenders if the loans were sold on the basis of false assurances. Since Bank of America’s acquisition Countrywide Financial, they have been particularly exposed in this area. Bank of America claimed the $1.3 billion payment to Freddie Mac settles all claims on 787,000 mortgages that valued at $127 billion. The $1.5 billion settlement with Fannie Mae however only claims to resolve 12,045 loans with unpaid balances of $2.7 billion. It partially resolves an additional 5,760 loans with unpaid balances of $1.3 billion therefore leaving Bank of America open to a future claim from Fannie Mae.
National Mortgage Standards are Encouraged
January 5, 2011
A group of investors together with academics has proposed a national standards system be created for Mortgages. The goal would be for such standards to be implemented as early as this spring.The group believes such standards could diminish conflict between servicers and investors, help avoid investor favoritism by servicers and set a standard for securities that avoids the pitfalls of the past thereby improving lending practices and investments in the national economy.
Fannie Mae Announces New Loan Requirements
December 3, 2010
As of December 13th, Fannie Mae will allow buyers to use gifts and grants from nonprofit groups for their minimum 5% down payment. However since most lenders require a down payment of 10% or more, borrowers will still need to come up with the remaining balance. Fannie Mae will also impose tougher guidelines regarding debt-to-income ratios which will drop from 55% to 45%. They also announced that people with foreclosures will need to wait 7 years instead of 4 to obtain a Fannie Mae loan.
Foreclosure Review Expected by January
November 17, 2010
According to Reuters, the Office of the Comptroller of the Currency (OCC) and the Federal Reserve are coordinating their reviews of lenders’ foreclosure policies, procedures and loan documentation. They also report that the major lenders also face state investigations and possible settlements would call for Bank of America Corp, JPMorgan Chase & Co, Wells Fargo and others to contribute money to a fund to assist borrowers who lost their homes to foreclosure. The Financial Stability Oversight Council (FSOC), which is due to meet for the second time on November 23, is also currently being set up to probe the housing foreclosure mess and recommend solutions.
Central Valley Foreclosure Rates Down From Last August
November 2, 2010
CoreLogic reported that Stockton foreclosures rate was 4.41% this August, down from last year’s rate of 5.41%.
Stockton’s mortgage delinquency rate also decreased with 14.87% at 90 days or more delinquent down from 15.72% a year ago. This is all good news, but Stockton still struggles with a rate higher than the national foreclosure rate average of 3.20%.
