"Mortgage rates typically track those of 10-year and 30-year Treasury and other government bonds. Yields, or interest rates, on those notes have been "rising amid lender concerns that the White House’s deal with Congress on Dec. 7. to extend the Bush-era tax cuts and the Federal Reserve’s move in early November to buy back $600 billion in debt to stimulate economic growth will combine to fuel inflation and swell the budget deficit."
“[B]orrowers aren’t the only ones concerned about potential mischief. Investors who hold mortgage securities are increasingly worried that servicers may be putting their interests ahead of those who own the loans.
“A servicer might, for example, deny a loan modification to a borrower because it also owns a second mortgage on the same property and doesn’t want to write down that asset, as required in a modification. Levying outsize default fees is another tactic — the fees typically go to the servicer, not the lender, but they can still propel a property into foreclosure more quickly. And foreclosures aren’t a good outcome for investors. “The result in once such case was a federal jury’s award to investors of several millions of dollars in punitive damages.
“Almost immediately, the plaintiffs in the suit contended, Compass/Silar started siphoning off money owed to investors holding the loans. Among the servicer’s tactics, the plaintiffs said, were improperly charging default interest, late fees and loan origination fees that reduced amounts due to investors.”In addition, when borrowers tried to renegotiate or pay-off defaulted loans, the servicing company refused to negotiate. “In other cases when Compass/Silar urged the investors to modify troubled mortgages, the servicer reaped undisclosed fees in the deals.”
“A Silar spokesman said the firm was pleased that the jury awarded only $79,000 in compensatory damages to the plaintiffs but was disappointed by the punitive-damages assessment. “The jurors are to be commended for their careful consideration of the facts in a very lengthy trial,” the spokesman said. He declined to comment as to whether Silar was currently servicing any loans.”
“It is obvious that we are in the litigation stage of the financial debacle of 2008. That usually means shining the light on dark corners and watching what scurries away. The view may not be pretty, but at least in this case, investors got some recompense in addition to an education.”A former employer gave me this saying about the business place - In some markets the bulls eat, in some the bears eat, but the pigs always get the garbage.
"has become increasingly concerned about the accuracy and reliability of documents submitted to the Office of Foreclosure."
A special master could be appointed to review the foreclosure practices of companies including Wells Fargo, JP Morgan Chase and Citibank.
“As least until recently, we’ve been in the midst of a refinancing boom. So consumers applying for refinancings should at least expect some delays.
“While lenders are leery about releasing details about how long refinancings are taking to close today versus a year ago, some are willing to admit that processing times are longer today for a number of reasons, including regulatory changes and historically low rates.”I’m not sure of the “refinance boom” since most home values in New Jersey fell dramatically over the past two years.
“Kris Yamamoto, a spokeswoman for Bank of America, said in an e-mail that the longer processing times are the result of the “dramatic changes” the mortgage environment has undergone in recent years, including “new underwriting standards being enforced and regulatory changes enacted” to ensure that consumers can safely afford their mortgages. She also pointed to the low rates.”How about the family that can afford its current mortgage but wishes to take advantage of a lower rate? Unless you had 30% equity, or more, in your home when you took your last mortgage, you can pretty much forget about it since home values have fallen as much as that number. Lenders will not make 100% loan to value mortgages despite encouragement by the Federal government.
“For months now, experts have been debating the fate of the home mortgage interest deduction (MID). So why exactly are politicians targeting the MID? With a federal deficit of around $13 trillion, officials are hard-pressed to find ways to curb the growing the debt.
“ Some say there are better options available than keeping the MID, following suit of many European nations who have in recent years nixed the deductions themselves, but the National Association of REALTORS® (NAR) disagrees. They feel that this deduction is a strong incentive for homeownership. For nearly 100 years homeowners have been allowed to deduct the interest paid on mortgages for their primary residences, second homes and most home equity lines of credit.”Frankly, the deduction of mortgage interest helped expand primary- and second-home ownership. Although not the primary incentive to home ownership, the deduction, when taken into account for budget planning, allows the buyer to buy a little bigger and better than her net income will allow. Call it a subsidy, if you will.
“NAR President Ron Phipps, states, "Recent progress has been made in bringing stability to the housing market and any changes to the MID now or in the future could critically erode home prices and the value of homes by as much as 15 percent, according to our research. This would negatively impact home ownership for millions of Americans, including those who own their homes outright and have no mortgage."
“Will Washington continue to allow taxpayers who own their homes to reduce their taxable income by the interest paid on the loan? Time will tell. It is dependent on finding alternative ways to curb growing anxiety over our growing debt.”Good luck to us all.
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