Obama's New Housing Plan

[laurannm]

http://ac360.blogs.cnn.com/2009/02/18/qa-on-the-foreclosure-plan-and-what-it-means-for-you/

Source:CNN

[laurannm]

First question I have, is how does this affect someone who has remained current on their mortgage but did not reaffirm their mortgage during a Ch 7 proceeding?

I am guessing non-reaffirmed mortgage will be left out....

[Flamingo]

8. I heard the government was providing a financial incentive to borrowers. Is that true?

Yes. To encourage borrowers who work hard to retain homeownership, the Homeowner Affordability and Stability Plan provides incentive payments as a borrower makes timely payments on the modified loan. The incentive will accrue on a monthly basis and will be applied directly to reduce your mortgage debt. Borrowers who pay on time for five years can have up to $5,000 applied to reduce their debt by the end of that period

What about those working hard now to continue to pay on the mortgage(s) they currently have and are struggling to pay so they can keep their home - LOL! Where is their incentive to continue to maintain home ownership? Oh I can see the Letters to the Editors now over this clause....

[fltoo]

Obama has lifted the requirement for Fannie and Freddie to refi only loans that qualify, previously 80% LTV.

50-60% of loan mods have defaulted again.

First the government forces the secondary lenders to lower their standards and purchase loans of unqualified mortgagees, now the gov is forcing them to refi the unqualified mortgagees.

Sound familiar? Here we go again.

[Lajazz947]

First question I have, is how does this affect someone who has remained current on their mortgage but did not reaffirm their mortgage during a Ch 7 proceeding?

I am guessing non-reaffirmed mortgage will be left out....

Question:

I am reafirming both my first and second.

Obviously I am in BK.

I can afford the payments without going into negative amortization if I really stretch but the fully amortized payment throws me into a negative every month if I use the federal guidelines on the means test.

The REAL figures on my other schedules using verifiable reciepts for utilities and food are higher than the federal guidelines allow but again, verifiable and still have me negative by a few hudred dollars a month.

As I see it my options are to contact my bank, Wachovia, and try to modify although they have refused in the past or wait to see if the BK judge modifies.

I a current on my payments and without any other debt other than the house my income to debt ratio is about 62%.

Does anyone see any other options or have a take on how the plan will affect me?

I will start making my calls tomorrow and see what they say. I will also report here in case there are other Wachovia borrowers on the forum.

[imoverit]

Thanks but no thanks. My house is so underwater, if it was refinanced I would be at 250% LTV! You can have it back!

[blindsided]

50-60% of loan mods have defaulted again.

That should read "up to 50% of loan mods have kept families in their houses, propped up neighborhood home values, and prevented banks from insolvency", but I guess those things aren't important.

First the government forces the secondary lenders to lower their standards and purchase loans of unqualified mortgagees

False.

http://www.federalreserve.gov/newsevents/speech/kroszner20081203a.htm

[struggling09]

Lajazz947 - Please do report back tomorrow after you make your calls. I also have a first and a second mortgage with Wachovia. We are current with our payments for now. However in 18 months, my second mortgage which is a HELOC, will adjust. I too have tried contacting Wachovia to see if they would work with us to modify the loan, but they have refused. I'm curious as to what they will do with this new plan.

[limage]

None of this will help me. My taxes and association fee are too much- almost $1000. I can rent a decent place for that much. Plus I'm so bitter over all of this that I'm ready to move on.

I do wonder if the modified refinances will include mortgage insurance. The premiums have gone up a lot and I wonder if it will even make sense to refinance if the borrowers are not currently paying it.

[Flamingo]

None of this will help me. My taxes and association fee are too much- almost $1000. I can rent a decent place for that much. Plus I'm so bitter over all of this that I'm ready to move on.

I do wonder if the modified refinances will include mortgage insurance. The premiums have gone up a lot and I wonder if it will even make sense to refinance if the borrowers are not currently paying it.

I believe it is a requirement of FHA mortgages for the first five years of the loan no matter what the equity is in the house. I researched this when we refinanced because when I reviewed the paperwork prior to settlement, I noticed the PMI and questioned the five year payments (included in mortgage payment). The only way out of it is to refinance during that five year period. Our rate is too low to consider refinancing as it would not be worth the cost so we just plod on. I don't know if PMI would be eliminated in the discussed circumstances. Great question.

[limage]

But these are conventional loans (Fannie/Freddie) not FHA loans. They dont even mention FHA loans, but those loans can already streamline refinance regardless of the loan to value.

[Flamingo]

But these are conventional loans (Fannie/Freddie) not FHA loans. They dont even mention FHA loans, but those loans can already streamline refinance regardless of the loan to value.

PMI is usually required when there is less than a certain percentage of equity in the house, usually 20%. I don't know if that would be eliminated or how it would be handled as to all this. Time will tell I guess. It can add a good chunk on a monthly mortgage payment.

[FLBK7]

I think this "Foreclosure Plan" should be a thread of its own. What do you think?

[Flamingo]

I think this "Foreclosure Plan" should be a thread of its own. What do you think?

There are other threads out there on this subject in some of the other forums. The folks posting on here are responding to the original news posting in this forum by the OP.

[FLBK7]

There are other threads out there on this subject in some of the other forums. The folks posting on here are responding to the original news posting in this forum by the OP.

The original post by Laurannm was moved from "General Talk" to "BK and Credit News." The latter is where I posted.