According to the latest Fiserv Case-Shiller index, the median mortgage payment for a single-family home is 40 percent lower today than it was at the market peak in 2006 — $700 per month compared to $1,140 just a few years ago.
Further, Fiserv predicts that housing prices will decline another 3.6 percent in the first part of 2012 before rebounding 2.4% in the second half of the year. (How it can be that specific is hard to guess.) This pushes back the firm’s predicted recovery time; its August report predicted “a broad-based recovery for housing that will begin in early 2012.”
The latest progress report released by the Treasury Department finds that the government’s three “H” programs — HARP (Home Affordable Refinance Program), HAMP (Home Affordable Modification Program) and HAFA (Home Affordable Foreclosure Alternatives) — have helped about 1,777,000 Americans stay in their homes.
In the case of HAMP, the delinquency rate of mortgage holders taking part in the government program is much lower than that of people using private modification programs.
As lenders begin processing foreclosures again, they may end up flooding the market — and cause housing prices to drop, according to a report from Fitch Ratings.
An increase to more normalized foreclosure initiation rates will ultimately add to the inventory of distressed properties on the market. This will in turn increase negative pressure on US home prices further supporting Fitch’s view that home prices will decline further before they fully stabilize.
(For translation, just see the first paragraph.)
The company said that it may take a year for the effects to be felt.
Bank of America disclosed that it has paid $1.3 billion in penalties to Fannie Mae and Freddie Mac this year for delays in foreclosure filings. (According to Housing Wire, F&F “charge servicers for taking too long to complete the foreclosure process under specific, state-by-state guidelines.”)
So why were the foreclosures delayed? Because foreclosures across the country were stopped in October 2010 when lenders’ robo-signing fraud came to light. Lenders who had forged signatures and falsified documents had to go back and fix things, which obviously slowed the entire process — and resulted in penalties from the GSEs.
This week Congress is deliberating the appropriations bill that includes restoring the higher loan limits on government-guaranteed loans. (Those limits were dropped on Oct. 1, and we’ve been fighting to have them restored.)
NAR has set up a “Click to Call” site that makes it incredibly easy to contact your Congressmen. It takes about 30 seconds — you simply tell the aide who answers that you’re a constituent, a Realtor, that you’re concerned about people being able to get mortgages, and that you want your representative to restore the higher loan limits.
After some initial bumps due to mistakes by loan servicers, HAMP — the Home Affordable Modification Program — appears to be gaining its sea legs.
And while it’s likely to fall short of its original goal of keeping three million or more homeowners out of foreclosure (the program cost was slashed from $75 billion to only $29 billion), it already has about 856,000 workouts on its books.
Notably, that includes 40,000 in September alone.
HAMP, part of the Obama Administration’s Making Home Affordable Program, allows borrowers in or near default to modify their loans so their monthly payment is about 31 percent of their monthly gross income.
Millions of foreclosed homeowners will have a chance for payback as part of the legal agreement between the government and 14 lenders who broke various laws for handling mortgages.
Homeowners whose lenders played fast and loose with their foreclosures may be in for a payday.
More than 4 million mortgage borrowers who were foreclosed on between 2009 and 2010 will have a chance to request an independent review of how their foreclosure process was handled…
Interesting column from Reuters’s Agnes Crane, “U.S. housing has added problem: mortgage insurance.” Why interesting? Because the trouble she describes hits right in the issue of down payments — specifically, the idea of a 20 percent-down requirement for the best rates.
There’s a useful post over at Dan Green’s The Mortgage Reports that explains who is eligible for the new, revamped HARP.
Click here to read “The Complete, Revamped HARP / Making Home Affordable Eligibility Requirements.”