Fannie Mae and Freddie Mac Roll Out New Deal for Homeowners

There’s finally some good news on the real estate front; “Fannie Mae and Freddie Mac have directed their network of servicers to halt all foreclosure and eviction proceedings between Nov. 26 2008 and Jan. 9, 2009, meant to give a recently announced rescue plan time to work,” according to money.cnn.com. It’s been a few months since these mortgage giants got bailed out by the government, and this is the first sign that they are finally doing something to try and at least help, if not fix, the problem they helped create in the housing market.

This action is meant to keep homeowners afloat while they await the start of the Streamlined Modification Program, which begins Dec. 15, and will allow homeowners behind in their mortgage to get a modified mortgage to no more than 38% of their gross incomes. Some people may feel as though this is bailing out those who never should have gotten into the real estate market to begin with, but the fact is that home foreclosures hurt us all, by lowering home values and draining our economy.

Notification to the homeowners who have already received eviction notices and/or have homes up for auction, should begin immediately, which should make for a much brighter holiday season. Unfortunately, homeowners who are in jeopardy of eviction between Nov. 20 and Nov. 26 will not get to benefit from this new deal; however, they may qualify for other deals offered by FHA.

This is good news, to be sure; however, it will boil down to a small percentage of homeowners in the shaky real estate market, even though Fannie Mae and Freddie Mac hold the mortgage for approximately half of the people currently in the housing market.

There are several factors that will go into the eligibility of this new deal. First, homeowners must be 90 days or more late in their mortgage payments, owe at least 90% of their home’s current value, live in the home on which the mortgage was taken and have not filed for bankruptcy. Again, it’s a good offer, but will only end up helping a small percentage of people, so I wouldn’t say it’s going to put a huge dent in the housing crisis.

On the up side, something has to be done and at least this is a start. The real estate industry is a vital part of our economy, and even the global economy as a whole. Things will get better in the housing market, but it may take a bit longer than we originally thought. Holding off on at least some of the foreclosures out there, is a good first step.

 

     

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Experts Predict Real Estate Market Turn Around

Experts: Buy Homes Now Before Market Turns Around

 

 

updated 12:58 p.m. PT, Fri., June. 20, 2008, on www.msnbc.com  

BALTIMORE – The stalling economy is having its effect on the real estate market in Maryland, as foreclosure rates are up and the number of approved mortgages is down. But experts said that it’s currently a good time to buy a home, as long as you know how to shop for a mortgage lender and don’t get taken by the increasing number of mortgage frauds.

Real estate broker Aimee Bader said that homes are staying on the market four times longer than last year at this time, which is bad news. But the good news is that, even though the market is down, the state isn’t seeing the bursting bubble decrease in property values that other areas are experiencing.

“Prior to 2007, Maryland was experiencing 12 to 20 percent gains that can’t continue. So, the market has corrected itself, and it’s a natural correction,” Bader said. But she said it will turn back around.

The Justice Department in Washington has indicted more than 400 people in the real estate industry since March during a crackdown on mortgage fraud. To make sure you don’t become a victim, you need to shop your loan to at least three different lenders, explained Bader.

“Every lender is required to provide what’s called a good faith estimate, which expressly shows what the charges will be, so there should be no surprises at closing,” she said.

Sage Policy Group economist Anirban Basu said it’s a vicious cycle — the bad housing market weakens the economy, which then lowers the housing market even more. But he said those low prices could actually be the key to pulling the state out of the economic slump.

“At some point, prices fall far enough that people are induced to come back to the market, and that’s when you see recovery,” he said.

Analysts predict the housing market and economy will start to turn around in 2009.

 

While this article posted in msnbc.com is specifically talking about Maryland, it may be a good time to buy property everywhere. With interest rates rising, the price of homes are sliding back down to a reasonable level. Visit us at www.iappraiseforyou.com to find out more.

 

contact: adam@iappraiseforyou.com