Mortgage News

Fannie and Freddie Resist Loans for Energy Efficiency
By Nick Timiraos
The Wall Street Journal
March 25, 2010

The government's mortgage-finance agencies Fannie Mae and Freddie Mac are resisting a White House-backed effort to make it easier for homeowners to get loans to make their houses more energy efficient.

The problem: deciding who gets paid first if the borrower defaults.

White House Nudges Banks to Modify Loans
By James R. Hagerty
The Wall Street Journal
March 23, 2010

The Obama administration is discussing with banks a change in its foreclosure-prevention program that would encourage lenders to reduce the loan balance due in some cases, people familiar with the situation said Monday.

The move would be an attempt to address the plight of millions of households whose home values have fallen far below their mortgage debt, a condition known as being "under water."

A Treasury spokeswoman said efforts continued to aid struggling homeowners but declined to comment on any new plans.

Plan to Reshape Mortgage Market
By Nick Timiraos and Michael R. Crittenden
The Wall Street Journal
March 23, 2010

Fannie Mae and Freddie Mac won't be allowed to return to a precrisis structure that rewarded shareholders with big profits for years but ultimately saddled taxpayers with massive losses, Treasury Secretary Timothy Geithner will tell a congressional panel on Tuesday.

The administration will outline broad principles for the future of the mortgage market at the hearing, including stronger consumer protections and explicit guarantees for any government backstop of mortgages.

Credit scores can drop after getting loan help
By Alan Zibel
AP Real Estate Writer
March 19, 2010

WASHINGTON (AP) -- Some homeowners who sign up for the government's mortgage assistance program are getting a nasty surprise: Lower credit scores.

For borrowers who are making their payments on time but are on the verge of default, the Obama administration's loan modification program can reduce their credit score as much as 100 points. That makes it harder to get a loan and can present a problem when applying for a new job.

Housing counselors say it's unfair, especially because the news often comes as a surprise to homeowners.

Two of the Three Little Pigs Would Have Trouble Getting a Loan
Odd Homes Built of Tires and Trash Lure Environmentalists, Turn Off Bankers
By Anton Troianovski and Nick Timiraos
The Wall Street Journal
March 18, 2010

HOT SULPHUR SPRINGS, Colo.—Like many Americans, Jon and Laura Hagar are searching for a lender to refinance their home loan. But banks are leery of the Hagars. Their rural Colorado house is made of 17,000 old tires.

A niche mortgage mess is brewing in homes made of earth, tires, concrete and trash. Environmentally minded people built them, hoping to conserve energy and to re-use what might otherwise wind up in a landfill.

Fed: Low rates will continue
By Chris Isidore
CNN Money
March 16, 2010

The Federal Reserve left its key interest rate near 0% once again Tuesday and said rates should stay this low for the foreseeable future.

Fed policymakers repeated their prediction that economic conditions are likely to result in "exceptionally low levels of the federal funds rate for an extended period." That promise of an easy-money policy has been in place since March 2009.

Fed Debates How to Signal Next Rate Move
By Jon Hilsenrath and Sudeep Reddy
The Wall Street Journal
March 10, 2010

Long before the Federal Reserve raises short-term interest rates amid an improving economy, it will need to signal to the public that a change is in the works. Central-bank officials are intensifying discussions about how to communicate that when the time comes.

For the past year, the Fed has signaled plans to keep interest rates near zero for a long time. Although officials aren't yet ready to change that wording, they are trying to think through a script well in advance for how to walk away from that pledge.

Nabbing a Bargain-Basement Mortgage Before Rates Rise
By James R. Hagerty
The Wall Street Journal
March 13, 2010

Is it time to rush out and buy a house before mortgage rates go up?

As the Federal Reserve winds down its intervention in the mortgage market, rates on home loans are generally expected to rise at least modestly during the rest of this year from today's unusually low levels. Some analysts believe mortgage rates will jump to around 6% by year end from 5% in recent weeks, while others see only a slight increase.

Meanwhile, federal tax credits available for some home buyers are due to expire at the end of April, adding to the sense of urgency many shoppers feel.

Bank of America Boosts Mortgage Modifications
By Jay Miller
The Wall Street Journal
March 12, 2010

Bank of America Corp. added nearly 8,000 customers to the ranks of borrowers modifying mortgages under the government's Home Affordable Modification Program in the latest month.

The giant bank said 20,666 of its customers had a permanent Home Affordable modification as of the latest monthly report, up from 12,761 that had been completed a month earlier. Bank of America said another 22,303 permanent modifications are pending, which means final loan terms have been approved and are waiting for customers' signatures.

Home-Saving Loans Afoot
By James R. Hagerty
The Wall Street Journal
March 8, 2010

Pressure is growing on U.S. banks to ease terms for distressed homeowners on home-equity loans and other second-lien mortgages.

Rep. Barney Frank, chairman of the House Financial Services Committee, last week sent a letter to the four biggest U.S. banks demanding "immediate steps to write down second mortgages." The Massachusetts Democrat sent the letter to the chief executive officers of Bank of America Corp., Citigroup Inc., J.P. Morgan Chase & Co. and Wells Fargo & Co. Meanwhile, the Obama administration is preparing to launch long-planned initiatives aimed at addressing these obstacles.