To Refi or To Modify, That is the Question

In an article that appeared in Philliadelphia Business Today entitled "Housing Chief Says Refinancing Program is Working" the executive director of Mount Airy USA, which provides financial  counseling, stated the following:

"Truth is that there are so many programs out there now . . . most struggling homeowners don't know why they are calling us other than for help."

This is an amazing statement, but one that we can all relate to. Over the past several months I have spoken to many people that aren't sure what to do about their home mortgages, some are so confused they settle for doing nothing. 

Homeownership is a big responsibility. Up until now it just meant that we had to maintain a yard or fix a pipe now and then. Now there is another kind of maintenance that needs to be attended to, the financial health of the home.

The first, and easiest place to start is taking this quick, simple, 4 question test to see if you qualify for the "Making Homeownership Affordable Program". Take the test here.

Most people will not qualify for this program. So the next place to go for guidence is the U.S. Dept. of Housing and Urban Development. There are over 26,000 locations from coast to coast. Find an office in your area here. Seek the the help of qualified counselor and find out exaclty what kind of help you need. 

Making the correct desision is crucial when it comes to the single largest purchase of your life. I hope you will take the steps to make an educated desision. 

Matt Kemper

YourCreditCompany.com

Homeowner Affordability Plan Is Out!

The Obama Administration and U.S. Treasury released more details on the Homeowners Affordability Plan today. The plan is meant to assist responsible homeowners that are in danger of entering foreclosure or going "under water" by lowering their monthly payments.

YourCreditCompany.com is dissecting the plan and will bring you specific details on plan, which goes into effect immediately. You can find the plan here, and read it for yourself to determine if you qualify or how it might affect your business.

We highly reccomend reading the text. Thus far the television coverage has just scratched the surface of what the plan entails. We can tell you that there are requirments that homeowners will have to meet. Homeowners will have to provide some documentation and will have to show hardship. The lender/servicer that carries your mortgage will also have to participate in the program, however if your home is serviced by Fannie Mae, Freddie Mac, or certain banks that took TARP funds will be required to participate in the plan.

Look for more details tomorrow!

Matt Kemper
YourCreditCompany.com
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What Is The Priority?

I know I am barking up the same tree, or preaching to the choir, but here I go again (remember, this is coming from an X mortgage lender, turned conservative)...

I was reading this a.m. on the HUD web site about the allocation of more that $10 billion of funds being distributed to HUD from the Recovery Act. Well really, who wouldn’t be excited about that? When these government loans where given they were insured by the government. They insure these loans with Mortgage Insurance, which is required on government loans, and the home owner pays for it directly out of his own pocket. This insurance does not benefit the borrower, it benefits the servicer of the home loan. The government is now funding a bail out or recovery plan for these loans. Who will this money help and what houses will it recover?

The plan is said to modernize public housing and fund energy-efficient programs. Is this a primary concern at the present time? The Native American Housing Block Grant will receive $255 million, again to be used for energy efficient modernization. $100 million to be allocated for lead based paint and hazard reduction. Tax Credit Assistence Program coming in with $2.25 billion. The list goes on and on…

These grants will help “State Housing” to kick start affordable rental housing projects that rely on low housing tax credit, and a measly $2 billion to be allocated to help section 8 project-based housing contracts. ( Since this is were we are all heading anyway) Is this the primary concern of the public right now? Is this really creating stable communities when the owners are walking away from there home because they can longer afford to support their families?

Lead based paint or going green…is this a priority to anyone else except the politicians? When you can’t go home, does it matter that you can’t afford to go green? Green…I think we are all seeing red right now.

Renee
YourCreditCompany.com

Help The Consumer

Welcome Back!

This morning I found an article from the Associated Press stating...

"...the Federal Reserve Chairman Ben Bernanke has steadied Wall Street by telling Congress the recession might end this year. Bernanke predicted the economy is likely to keep contracting in the first six months of 2009. But he also said, "there is a reasonable prospect" the recession will end this year. He reports, and warns that a recovery will require getting credit and financial markets to operate normally."

What does this mean to the average consumer? The consumer's confidence spending index for February came in at 25 on a scale of 100. That is obviously well below expectations. These concerns attribute to unemployment rates on the rise, adjustable mortgages increasing, and the stock market remaining in an unstable position. The Home Owner Affordability and Stability Initiative has not been implemented. However, it will affect the consumers on many different levels. It is intended to keep people in their homes first and foremost. Further, it aims to lower monthly payments, thus it could change spending habits in a positive manner.

In an effort to get the credit and financial markets to operate normally the Treasury Department, the Federal Reserve, and other banking regulators said Monday that they could exercise an option to convert to government's stock in the banks from preferred shares to common shares upon results of a "stress test" of the banks the government has a stake in through TARP funds. The stress test will help the Treasury Department identify and weigh the toxic assets on the banks' books.

the President will address the U.S. congress this evening. It is important that all of us, as consumers, work to move forward and find solutions.

Renee Fogle
YourCreditCompany.com

What We are Watching

Welcome Back!

I hope everyone had a great weekend. This week we are looking at a couple topics that directly pertain to you or your friends' financial affairs.

First, Credit Cards always seem to be a hot topic. As they should be. It is not hard to find someone who has been broke, to use credit cards (in the interest of fairness there have been a significantly less number that have made a fortune because they maxed out their credit cards). The Senate Banking, Finance, and Urban Affairs Committee have been holding hearings examining the credit card industry. We will be following the hearings as well as any other events in this industry.
If you are looking for information on credit cards or a place to "shop" the best rates check out YourCreditCompany.com

Second, we are watching for more updates on the Homeowner Affordability and Stability Initiative. The U.S. Senate's Banking, Housing and Urban Affairs Committee is scheduled to hold hearings on the initiative on February 26, 2009 at 10:00am.

Check back soon, or better yet subscribe!

Matt Kemper
YourCreditCompany.com

Homeowner Affordability and Stability Plan

Homeowner Affordability and Stability Plan

To open, I should remind everyone that The Homeowner Affordability and Stability Plan is a proposed initiative. President Obama has set Wednesday March 4, 2009 as the day he would like it enacted. The Initiative is valued at approx. 75 billion dollars, intended to help homeowners that are currently or soon to be in danger of losing their home to foreclosure.

The Initiative will begin with 3-4 million “at risk” homeowners targeted. These homeowners have loans that are conforming and secured by Fannie Mae and Freddie Mac. The total Initiative’s goal is to help 7-9 million families save their homes. To achieve this Mr. Obama would like lenders to refinance loans or modify loans. In return, the government will give monetary incentives to the lenders as borrowers make payments on time. Additionally, the government intends to incentivize the homeowner for making payments on time.

Affected by the collapse of the housing market are a great many people. Housing lead us into this recession and many hope housing will lead us out. Mr. Obama’s Initiative seems to have that in mind. A major question that you should be considering over the nearly 2 weeks before this Initiative is enacted is: “How does the government define “at risk” or “responsible” homeowners? This will help you identify if you will qualify this Inititaitive.

I would like to close by pointing out two axioms of the real estate industry. First, all markets are local (do not look too closely at the nationwide scope). Second, real estate is a cyclical market. Every homeowner must endure down markets and enjoy up markets.

Stay tuned for more details!

Matt Kemper

www.YourCreditCompany.com