George's Blog

George:  As always, thank you for keeping us informed

Dianne, you are very welcome.

Goeorge, thanks for this info.  I've bookmarked the post for future reference. 

Lola I hope it come in useful for you.

:)

Hi George, Good to see you writing and posting again. It's been a long time. I hope this plan works to helpsome folks but we'll just have to wait and see. In my mrket most folks just want to move on. They're beaten.

Thanks for the info and I agree with you that this will help a very small percentage of people.  The more we drag out the inevitable the longer this is going to last.  Band-Aids eventually leak and governmental band-aid rarely stop any bleeding at all.

Thanks for the summary. It is too bad that no one can figure out how much of a mess the housing industry is in and how to give the homeowners a boost. right now there is no consumer confidence as evidenced by the real estate market and the stock market.

Interesting info George...Thanks for getting it out there!! I assume this will be similar to the FHA Secure program....Sounds nice, but isn't used much.

Dan

This is feel good nonsense.  Would that they had the depth of restrictions on the banks' use of TARP that they do on home owners "help".

 

I'm with Lenn and Simon, sounds like a king sized bandage to me. Excellent post George!

George:  You are the best, I love reading the information you post but most of all I love your REALISTIC opinions.  My question is, if the Homeowner is losing their home today because the rate is too high and we bring it down to the 31% of income today so in 5 years it goes back to the starting rate " yadayadyada"  it sounds to me like we are just delaying the inevitable?????   This is just a bandaid for 5 years not a solution.  Clearly I must be missing something! Help me out here with soem wisdom.

 

Thanks

 

Adriana

TLW always a pleasure to see you stop by :) :)

Byant, I think our whole country feels like that, they want to move and for government to stop waisting time and money on plans that have not done any good.  And unfortunately I think this one is going to be much of the same.

Simon, I fully agree with you statement on band-aids.  Thank you for your input.

Michael, unfortunately the best boost to the market is probably letting the market take its natural course and stop prolonging it with these type of programs.

Seems like a lot of time and money devoted toward a "solution" that will have very little impact. I agree with Bryant, our people are "just beaten."

Dan, you got it, sounds good but that is about it.  This one might even do less then the FHA Secure program did and that is pretty bad.

Lenn I love the way you phrase things, "This is feel good nonsense."  You nailed it :)

Dena, that is exactly the way it comes across to me also.

Adriana, you don't need any help, you have an excellent grip on what this really is. But to just a little to what you stated, even with a reduction in the rate down to 2% and a 40 year amortization I don't see how most of these people will get down to anywhere near a 31% Front Ratio.

Pam as always Bryant has a great understanding of things and a grip on how people are feeling.

George,

This newest program will help marginally, at best. Especially in the hard-hit areas, like Las Vegas, NV, if there is no principal reduction involved, it won't do much good.

Thank You!  You made this information clear and concise.  I also will book make this.

Hi George - we appreciate you keeping us up to date and current on mortgage news.  When this information becomes widespread, it could help curtail the slew of "loan modification preparers" who are crouched to prey on those looking for a way out of their mortgages.  We have heard costs of $4,000.00 per shot, with promises of cutting back interest rates to just 4%!  The offers being made are not just to those delinquent or upside down either! 

Esko, I agree that this will help very few, and as far as the reductuon in principal goes, you might be right about that making a difference, but I do not agree with doing that.

Diane, I have seen that around here as well.  When the lambs are exposed the wolves come out in force.

Lois, I almost missed your comment.  Thank you for your kind words.

Thanks for that recap. Very helpful. I hope it helps a lot of people in need.

If consumer assistance begins with the ability to actually reach the correct person, at the bank or lending institution,  it will be of no value to anyone.

I have spoken with numerous people who have already attempted to reach their lender to get information and got nothing but frustrated.

I suppose we all must remain hopeful that things turn around for our country and the rest of the world.

Thank you for the information though.

Thanks for the information!

George, are loan modifications still OPTIONAL for the lender?

George,

Thank you for the post. I agree with Lenn. Everything should have begun with the homeowners.

 

Hello George, 

Thanks you for sharing this valuable information with us.  I am very interest in loan modifications. I have successfully complete two loan modification for my clients as a courtesy (no charge) now they are very happy with their new payment. I am looking forward for the second part of your blog.  Thanks

Kelsey, I know many people hoped it would, but personal knowing how loans work I  feel that it will at best help only a few.

Connie, that is my understanding that it is optional, that is why they are providing the incentives.

Ann, Lenn and I have had good discussions in regards to that on one of her recent post.  I respect and understand position on the need for homeowners to be bailed out, but I feel that most of the homeowners in trouble, are in trouble because even though they knew that the monthly payment was beyond what they could afford still did it anyway.  Also investors the had big dollar signs floating around in their head made bad decisions.  I don't feel that it is up to the American people to bail them out or the banks.  Like I said in the beginning of my comment, I understand and respect those with the opposing opinion but I don't agree with it.  And by the way Lenn is one of my favorite people on here.

Mayra, congratulations on successfully completing two of them, I hope they learned from their experience, and take advantage of the second chance the they have been give.

What about 2 mortgages that people have that are not Fannie or Freddie?

Great post. I had blogged about the prelimonary criteria. Wondering if you have a link to this EXACT rules that I can forward to the consumers inquiring about this?? Thanks!

Russ this plan only applies to Fannie and Freddie mortgages, because they and subprime were the ones that had supper relaxed guidelines.  Even though FHA. and VA also have some troubled morgages, their guidelines were much more controled, but maybe something is in the works for them also, I just have not heard about them yet.

Thank you for continuing to keep us informed. It's valuable information.

AnnMarie, you got in there while I was responding to Russ.  No I do not have a link, the above summary is our own based off of the full document which is much longer and detailed, and a little to much for most of us to digest.  Feel free to forward this blog to them.

Remo, thank you for stoping by and commenting.

George, thanks for summarizing.  This is just a curve in the road in my opinion. 

Hey big George - interesting post.  So, wihile you feature the specs of the plan via your Blog........You do not support it???? So if one of your clients is in need would you send them to someone else or try and use "whatever programs" are available to help them????? or perhaps you have a plan you can promote.  If so, Blog it, cause we need all the help we can get!!!!

Cheers

 

This seems to be a very good step. Although I appreciate that it might not be all that helpful without some reasonable principal reductions. Otherwise, consumers are still paying for the overpriced properties that were the problem in the first place.

Brian Madigan

Tim and Pam I think your opinion is pretty accurate.

Omega, I would never put my personal feelings above my clients needs.  So if one of my clients was one of the few that this plan might help I would utilize it.  As far as if their is anything else out there that might be more affective if some one is in trouble, I don't know of one.  But what has to happen is for people to make more responsible decisions when they are purchasing a house as we move forward form this.  I believe it is to late for those that acted out of just want and did not fully take into consideration the repercussions of their actions, but it is not to late for others who are purchasing right now to purchase within their means and not wants.

Hi George- Ilearned a few things from this Post....the feel good part might not be a bad thing since so many have been badly bruised by current circumstances.  I know that not everyone that is in foreclosure is there because of loans anymore, now there's a would wave of people that have lost their jobs.  You said about letting nature take it's course, and I think in many ways I would have to agree with you.

Brian, I don't know if the problem was over priced properties, or just plain and simple buyers buying beyond their means.  No one forced them to buy, that was their decision, it is not up to everyone else that bought withing their means to pay the price for those who didn't.

Kathy, I am all for trying to help those who are in trouble through no fault of their own, like those who have lost their jobs, or because of health reason, but others I feel need to live with their decision.  The problem that I have with the feel good in this plan is that I think it is offering up false hope to those that are  looking to it for help.

George thanks for the post and breaking it down.  I really don't having anything to add because Lenn has already voiced my thoughts. 

Happy. Happy.  Joy. Joy. Let's all feel good and make it look pretty. Rah-Rah-ree it feels good to me.  Rah-rah-rass this is going to bite us in the _____.

Good to see a fellow Connecticutian representing on the mortgage front.  Thanks for the information.

Jessica .......... Thank you for give me a good laugh at the end of a long day.  Very well put ....... LOL

Manolis, where are you in Connceticut?  Join the site, their are a number of us on here.

Thanks for the great info!  Great to know!

Yep...right there with you. It's a temporary band-aid and isn't really going to help all that many people.

Thanks for the info.  I hope you do not mind me re-posting it.

I am curious what you think would be a solution?  I really dont know. 

I honestly think that if a house is totally not worth what a person bought it for they should take their lump and move on or find a way to make the house payment. 

If these options do not work for the homeowner they need to walk away and find a cheaper housing option.  I hope that does not sound heartless.  I could find myself in the same situation if my wife gets laid off which is always a possibility but we will move on and make our way through it.

We will always have each other, family and friends.

Now say some people do not have that option and we start having homeless families we are going to have to find an instant fix for them to have shelter and be able to be productive.

I already see the "loan-mod" companies poping up all over the place for that $1,000.

George!  Congratulations on your well-deserved gold star.  It pleases that I can get my information second-hand from you.  It takes less digesting for me that way. =)  Thank you!

Bridget glad you found it useful.

Colleen, it is much like all the others before it, may if this had been an earlier option it might have stood a better chance, but right now it does not real do much.

George, unfortunately I really don't see much else that can be done out side of you you suggested.  I do feel that that something needs to be put in place to help those who are losing job, but for those that made bad decisions they need to take responsibility for them.

Jaime, I am sure that more of that will happen.

Maggie you are always welcome to my second hand information ......... LOL

George,

So where is my bailout?  ;-)

Ann Hayden in rainy Wildwood, Missouri

Hi George -- I too wonder how many people these new programs will actually help.  I think the actual #s will be far less than the goals, but I hope I am wrong.

Ann, for you I will come up with one ....... LOL

Kudos to those who have tried to sort through all of this a boil it down so we can understand it.  I am going to withhold judgment until I get all the facts and details.  It is not the easiest of things to understand. 

Chris I agree with you, but like the others before it, it will probably help a few, but it is false hope for the majority.

Joan, that is a wise approach.  We all have to come to our own conclusion, and the purpose of this post to try to assist in that.

George- thank you for the information... I'm not sure how many homeowners this will actually help in Southern California.  If it helps even a few, it is worth it, but I do not see this as a road to recovery.

JB, that is a good attitude to have about it, and a realistic take on your final conclusion.

You know who will pay for this! Us and especially us in small states where the housing bubble did not take place. We should thank a couple of states for the mess as they have the bulk of the foreclosures. Need not name them. Where are all the bad banks?

I guess the ones that voted for Obama get the spoils and money.  If you give incentives to buy and hire the mess would clean up faster.  How much of these funds are going for overhead. The numbers will be astonishing in the end. Please help me I spent too much ! I wanted something I could not afford !

ummmm - "So if one of my clients was one of the few that this plan might help I would utilize it." I learn something new - 4 to 5 million is a few????

I'm sure you've seen the specs but in case you didn't here you go!!!!

http://www.financialstability.gov/

Cheers!

 

George - I can't tell you how happy I was to see your post tonight!  Congrats on the feature too!!! :)  I am meeting with a homeowner tomorrow night who has been fighting to stay current with her mortgage payment but doesn't know how long she'll be able to stay above water.  I'm not sure if she would even qualify for this new loan modification program so you might be hearing from me on Thursday to get some more information.

Thank you for making this information so clear and concise. I'm looking forward to your second post on this subject.

Hi George; Very nice summary of the key points of the loan modification program.  Thanks!

Eric, good questions and you make a good conclusion.

Omega, I know what they would be helped by this, but the reality is it will not even come close to those numbers.  The proof will come soon enough, and my opinion is that this plan will be no different then all the others before it that were also suppose to help millions, when in reality it did not even come close even though the tried to fudge the numbers.

Donna, I will be happy to look at end, who know she might be one of the lucky few that this will help.

Christine, I will try to put up the refinancing part of the plan tomorrow if I can free up the time.

Eileen, thank you for your comment.

George: Great post full of good information. I think we should sent Lenn to Washington, she is more knowledgeable than they are and she can certainly make her point with just a few words.

Sandy, Lenn is a great asset, we differ with each other at times, but her position is always well make and one that I respect.

George,

Thanks for the update.  The gross ineffectiveness of this program and the fact it will affect a minority of homeowners tells me the crisis wasn't as real estate related as it was deemed to be.  It seems to me Wall Street is benefitting the most from our mortgage meltdown, not the folks in the so called "troubled assets"  i.e., the homes we were all so worried about.  Of course there are markets where the housing market is completely upside down, no doubt, but so far the billions spent to right the ship have gone to banks and insurance companies many of whom are smugly announcing they may take the funds and buy other troubled assets such as failing banks.  We have either been duped by our elected officials or they are dumber than I care to believe.  Either way, we lose today.  We can take the day back by de-electing these knuckleheads when we next have the chance.

George,

Sorry to jump back in so quickly, but I noticed many of the responses asked what other solutions were available to fix the mortgage meltdown problem.

Remember, we've been down this road before in the mid-80's with the Savings and Loan crisis!  I was a young commercial agent at the time in Denver and remember the scenario well.  Lenders had over-loaned on commercial and residential properties and inventories of both were HUGE!  The government fomed the Resolution Trust Corporation to handle the disposition of troubled assets.  The RTC was a huge clearinghouse for foreclosed properties.  Lenders came to the party by offering new financing for investors, fixing up vacant, gutted buildings, setting aside escrowed funds for repairs and taking hard write-downs on money owed them.  I sold a 40-unit apartment building for $500,000 that just two years prior had sold for $1 million.  The lender threw in another $60k for fix-up and the new owners filled the complex up and went forward.  The market solved the problem, not the government bailing out rich guys.

Hi George - Thanks for the summary. A couple of the elements of this plan (possible 40-year term, and the balloon payment) look like they make it difficult for the homeowner to build any equity over the next few years. It will be interesting to see where these loans and homeowners are five years from now.

Do you think that loans that are now serviced by Fannie and Freddie are those that have been purchased to bail those that are no longer here? It is a graveyard of lenders after all, isn't it? Where did all those loans go? Here they are....Only those that are truly high ltv, high rate, adjustable loans with pre-pays and 6% margins are those that are going to get bailed.

Yes, not everyone will be helped. Those of us that are just basically at a loss, equity wise, are not going to benefit. Media and Politicians spin wonderful roses..Spring has yet to come, but it will.....

We will turn this around, our veterans are coming home and we are a proud country because we have the right to own private property. Fannie and Freddie are now government owned entities, ouch. Don't expect much, and hold on..

George - Thanks for taking the time to analyze and summarize this program. I agree with you that it will only benefit a few.

Not too many people will benefit here in the Silicon Valley.  Home prices have dropped dramatically and the medium home price was over $600,000 so not too many people have Fannie Mae or Freddie Mac backed loans.  I recommend that homeowners in trouble talk to their lenders first regardless if they have FHA backed loans to see if they are willing to do a loan modification.

As normal... I'm with Lenn on this one... Love Jessica's comment though..

Tough for somebody to solve a problem when they can't figure out (or ignore) what caused the problem in the first place. Of course .. this would be an admission of guilt and that's something some certain elected officials just seem to always be above..

I predict it will be as successful as the Hope for Homeowners program that came out last year.

 

It will help some but not many. Banks here in MN are not working with consumers and no one can make them.

George -

Thanks for the summary - but, as others more venemous than I, I tend to agree - this will help far too few.  It will not address the problems of those in the hardest hit areas, many of whom have seen their home values fall as much as 50% or more.

We're going to have to come back to the well once again, I am afraid - likely, soon!

DEAN & DEAN'S TEAM CHICAGO

Great job I have re blogged this to add such great information to my readers. This will help cover the 100 questions per week I get on this subject.

George,

I'd like to see how long it takes for this to make any such impact one way or another.

Great information.  Thanks for helping us stay informed.  Unfortunately, I don't have much hope for the positive impact of throwing money at a problem.

Dennis it is probably a little of both, and I agree with you on the way to take control, and your solution for this problem.  Time we start learning from the past.

John, there is a good good chance that they will be even in bigger trouble 5 years down the road.

Julie, I know that many of the loans have been bought by Fannie, Freddie and FHA.  How many I am not sure, but the way out of this is to let the market take its course, the more we mess with it the longer it is going to take.

George, thank you.

Anja, I agree it should be where they start.

Paul, I am afraid that you might be right about your comparison of this program and the Hope program.

 

Michael I fully agree!!!

Teresa, and that might just be the bottom line.

Dean going to the well has not helped yet, I don't think it will be the answer no matter how many times we go there.

Laura, glad that you were able to use this information.

Neal I don't think it will take very long to get an answer to that question.

Bruce & Mary those are my feelings as well.

George,

I like your disclaimer, "it does not mean that I am in favor of this, or believe that it will help us get out of this mess that we are in, because I don't believe that. I think that this plan just like all the others before it will help very few if any, and is more smoke and mirrors then anything else".

I have found myself writing this same ting every time I talk about Washington's proposals. :)

Hi George,

Thanks for the info on this, I knew I would find it here! :)

It's interesting to me that the Treasury wrote 17 pages of specifics for loan modification detailing exactly how it was to work and yet only a brief Q&A for refis. They then put guidelines for the refis into Fannie and Freddie's hands.

Mark, I did not want members to think just because I was providing a summary that I agreed with, and a disclaimer clears that up quickly.

Suzanne glad that I can be a source of information for you.

Darrell, my second post on this will be on the Refi component and maybe that will provide some added information for you.

 

Big George - since nothing will work or get the numbers publicized - what should we do????

Cheers

Fred, unfortunately sometimes the best thing to do is to let things run their course, and let the market do its thing.  Every program so far has only contributed to making maters worst in my opinion.  Most of those who are have troubled mortgages will end up defaulting no matter what, all these programs have do so far is to delay that.

I have participated in several local seminars the were promoted by the state to try to help people with some of the past program FHA Secure being on of them.  After spending countless hours of listening to people pour out their hearts, and crying, and not being able to do anything for them, because these program had guidelines that they could never meet. I have come to the conclusion that it more cruel to give them the  false hope of the past, then to just help them face the fact that they took on more then they could pay for.

I agree you this last statment. Most people with a forclosures problem in my state are in the same boat, they took on more then they could pay for. Thank you for your help Patt

George - You are one of the mortgage expert who provides informative motgage info to your fellow Realtors.  It is appreciated.

George, good summary but I think you are wrong on this program being for Fannie and Freddie loans - the loan refinance program (where people can go up to 105% LTV to refinance an existing Fannie or Freddie loan) is for Fannie/Freddie borrowers only - the loan modification program you are discussing is for lenders who have taken TARP funds, and hopefully other lenders also.  See my blog post http://activerain.com/blogsview/970159/Details-of-Housing-Rescue-Plan-coming-out and  the links I have posted there.  Maybe I am mistaken, but all I have read says the refinance program is limited to fannie/Freddie borrowers and the other loan modification program is not.

Patt, thank you for sharing that.

Jennifer, thank you, I really appreciate that coming form you.

Paul, you might be right I will double check that with my people tomorrow.

Hi George,

Great information however Paul is correct. The loan refinance is only for loans that are securitized by Fannie Mae & Freddie Mac. The loan modification part of it is open to all homeowners regardless who backs their loan.(provided they qualify under the guidelines) Here is the link that provides that information. (it is #15) Hope this helps!

http://financialstability.gov/docs/borrower_qa.pdf

 

 

 

Diane, thank you for clarifying this.

Hi again George.  So, let me get this right...... if your neighbors house is on Fire - let it burn down.......or if your friend is drowing because he feel in the lake and forgot to tell you he couldn't swim - let him drown????

C'mon - you appear to be a person with solid experience - What is your solution to getting us out of this mess???  The easy part is reporting the incident.  :)

Fred you keep on ending your comments with the same question, which will lead to the same answer from me.

The situations that you present in the beginning of your comment are not even remotely close to what is happening in the housing market in MOST cases.  The burning house or the drowning could maybe be applied to someone who has lost their job or is out of work because of health reasons, for those people I have already state that something should be put in place for.  But to equate someone who willingly jumped in the ocean knowing that he can't swim and expect me to give up my life trying to save him, isn't going to happen.  And my comparison is closer to what is happening then yours.

Thanks George - I did't write the blog YOU did!!!!  Although interesting my simple question was since you brought up an interesting topic - WHAT IS YOUR SOLUTION FOR FIXING THE MESS???? since you stated the proposals on the table will offer little, if any relief.

Cheers

Thanks George for the very concise information. We have three years of inventory in one zip code here as the medium price point is higher and over 500,000 ...it will not help that many people

Anne & Eddie, my youngest brother lives in Tucson, and the price of houses in his nieghborhood have dropped so much that there is no program that is going to help him.  Some are just going to have to ride this out.

here is the thing if you go to the government website...it has the faqs... I called my mortgage company just to put it to the test..and they told me I was not eligible because I was current and that my rate was already good 5.125%..

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