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This morning, on a conference call with reporters, HUD Secretary Shaun Donovan and Director of the National Economic Council Gene B. Sperling discussed the Federal Housing Finance Agency’s announcement on changes to help more homeowners refinance. As part of President Obama's executive action push on the economy, this is an effort to provide economic stimulus and stabilize the housing market.

This is not a loan modification plan, in that it doesn't create a direct mechanism for the home values to be realigned with actual market value—it doesn't include any principle reduction, but is instead intended to eliminate some of the barriers homeowners who are current on their mortgages but still underwater face when trying to refinance to take advantage of low interest rates. Using the existing Home Affordable Refinance Program (HARP), it will reduce many of the costs of refinancing, by either eliminating or reducing many of the closing costs and fees—appraisals, title insurance, loan processing—for homeowners.

But it also, critically, will waive the representations and warranties that lenders are required to provide in making new loans. Banks have been reluctant to take on refinances because the paper trail on so many mortgages is either lacking or potentially fraudulent.

"Removing reps and warranties has the potential to unleash competition for housing refinance," Sperling said on the call. It makes taking on loans less toxic, and opens up new potential business for banks.

Homeowners must be making on-time payments and be current on their mortgage that is owned or guaranteed by Freddie Mac/Fannie Mae. The loan also has to have been originated or have been sold to Fannie Mae or Freddie Mac before June 2009. The loan cannot have been refinanced under HARP previously, unless it is a Fannie Mae loan that refinanced under HARP between March and May of 2009. Additionally, the current loan-to-value (LTV) ratio for the property must be greater than 80 percent.

Donovan said that the administration estimates participating homeowners could save potentially more than $2,500 annually on interest payments, saying, "It's the equivalent of a substantial tax cut for these families." In that sense, this program is more economic stimulus than a housing program, which is key. Coupled with another administration initiative, Project Rebuild, the program could inject some life into the nation's housing market. The latter program is a $15 billion fund to rehab vacant and foreclosed residential and commercial properties. Its prospects are a little unclear, as it's part of the larger American Jobs Act Republicans have already rejected.

Sperling said that the administration wouldn't speculate on the number of homeowners who would participate, saying that "such forward-looking projections are inherently uncertain." That's a smart approach, given the relative failure of the existing HARP program until now and the very real failure of HAMP. He did, however, say that the Federal Reserve had estimated that as many as four million borrowers could potentially qualify for the program.

Both officials stressed that the number one issue for getting the economy moving again, and that includes the housing market, is putting America back to work. Donovan stressed that the "single thing pushing people into foreclosures is unemployment," and that action on jobs is critical. Sperling, saying that the administration "wants to attack" the issue "on all fronts," didn't rule out other legislative efforts.
 

Originally posted to Joan McCarter on Mon Oct 24, 2011 at 09:50 AM PDT.

Also republished by Daily Kos.

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Comment Preferences

  •  Easier Mortgage After Short Sale (10+ / 0-)

    It doesn't look like this initiative addresses the problem of someone who sells short because of any number of reasons (job opportunity elsewhere, empty-nest downsizing, lost income downsizing) and wants to buy a smaller home at current low rates but is barred because of the short sale having taken place.  This problem, as well as the similar one following foreclosure, needs to be tackled as well.

    "Great works are performed not by strength, but by perseverance." Samuel Johnson

    by Rona on Mon Oct 24, 2011 at 10:04:09 AM PDT

    •  That's a separate issue... (0+ / 0-)

      ...because short sales require forgiveness of a portion of the principle.  That's a lot harder for the president to do with an executive order than easing the rules for refinances of what are already government held (or backed) mortgages.

      To me, this looks a lot like the FHA's "streamlined refinance" program back in the nineties -- which was (and is) a good idea that will help some homeowners.

      Ideally, however, it would be part of a suite of broader solutions.

      Political Compass: -6.75, -3.08

      by TexasTom on Mon Oct 24, 2011 at 07:05:43 PM PDT

      [ Parent ]

  •  My sister lost her house in late '09. (15+ / 0-)

    She was in the same exact position (current but deeply underwater) that the homeowners Obama wants to help now are.  Nice exec. action on his part, but two years too late for her.  She tried to get the mortgage co to refinance to no aval, and there was this constant drip of news-rumors that Obama was about to do what he finally did do this morning, but in the end she had to walk away and file Chapter 11.

    She's just this month bought a new house after living in an apt for two years and heroically climbing out of that Chapter 11; I wonder if she'll vote for him like she did in '08?  I sure as hell wouldn't try to talk her into it.

    "Faced with what is right, to leave it undone shows a lack of courage." - Confucius -/- "Yeah, well, the Constitution is worth it if you succeed." - Nancy Pelosi

    by nailbender on Mon Oct 24, 2011 at 10:09:41 AM PDT

  •  So if someone has perfect credit, which probably (21+ / 0-)

    means they aren't in danger of foreclosure because they haven't missed payments and fallen behind, and that they haven't lost employment or income, then they can get a new loan.  But if someone doesn't have perfect credit because they lost a job or had wages reduced and got behind on payments, they're still SOL.  
    I don't see how this is going to help curtail foreclosures and the people who really need help.  

    •  No it doesn't help everybody (23+ / 0-)

      then again there is no single thing that will help everybody. However this does help about 1.6 million home owners.

      I will say this my credit was/is in the tank, foreclosure was in the works and I went to my credit union which still owned the mortage Credit Unions don't sell off their mortgages) and said what can I do to save my house. They were very quick to say well how about you apply for a new mortgage with us at a lower rate (3 points lower) under a hardship provision and we will approve it.

      Now I did have the advantage of the Credit Union holding the original mortgage on my home. I am not sure you could go to a credit union if your mortgage was held by someone else and get the same deal.

      But just another reason to get the hell away from the big banks.

      Republicans 2012 . . . Keeping millions out of work to put one man out of a job.

      by jsfox on Mon Oct 24, 2011 at 10:35:46 AM PDT

      [ Parent ]

    •  It probably won't (9+ / 0-)

      but it could help inject additional money into the economy. Also, get rid of some of the high interest loans that banks are benefiting from.

      My take on this is that there is very little he can do as long as the republicans are determined to thrwart him. He can only try to deal with the economy by chipping around the edges.

      Shop Liberally this holiday season at Kos Katalog

      by JamieG from Md on Mon Oct 24, 2011 at 10:55:26 AM PDT

      [ Parent ]

    •  Yeah, that's when I stopped reading... (13+ / 0-)
      Homeowners must be making on-time payments and be current on their mortgage that is owned or guaranteed by Freddie Mac/Fannie Mae.

      The loan also has to have been originated or have been sold to Fannie Mae or Freddie Mac before June 2009.

      Sometimes I feel like I come from another planet...this is supposed to make sense???

      Photobucket

      'We Will Not Be Co-opted' ~Jesse LaGreca

      by Annalize5 on Mon Oct 24, 2011 at 01:17:16 PM PDT

      [ Parent ]

      •  Actually, makes sense... (4+ / 0-)
        Recommended by:
        BigAlinWashSt, wishingwell, askew, Byblis

        ...one of the real problems with past attempts to help homeowners was hat the homeowners actually had to be nonperforming on the loan.  In other words, people who were dooing the "right" thing and paying their mortgage every month could not get help.  That approach bred serious resentment (along the lines of "those a$$holes bought more house than they oculd afford, while I'm stuck paying my mortgage - why the heck should THEY get more help than me?"

        We reach for the stars with shaking hands in bare-knuckle times.

        by TheOrchid on Mon Oct 24, 2011 at 01:32:10 PM PDT

        [ Parent ]

        •  It's more than that though... (4+ / 0-)
          Recommended by:
          michelewln, Byblis, Annalize5, TexasTom

          Many home owners can pay their mortgage but are stuck in their home and can't refinance to lower rates.  I have excellent credit and an income that is enviable.  I represent no risk but for the risk of strategic defaulting because I'm so deeply underwater.  If I could refinance, I could save $500-$700 / mo on interest.  This is money that I would immediately go back into the economy instead of paying interest to a bank that won't loan.  This is economic stimulus and it won't even cost the government hardly anything.

          •  BrowniesAreGood... (1+ / 0-)
            Recommended by:
            BrowniesAreGood

            thank you and I get that. I'm also glad it's good for you. Sincerely.

            I have excellent credit and an income that is enviable.  I represent no risk but for the risk of strategic defaulting because I'm so deeply underwater.  

            If I could refinance, I could save $500-$700 / mo on interest.  This is money that I would immediately go back into the economy instead of paying interest to a bank that won't loan.  This is economic stimulus and it won't even cost the government hardly anything.

            The people who have been left out in the cold, however, are the people who've lost it all. They've no job, no money and what they have left of a credit rating has been shredded. Likely they've maxed out cards buying groceries to keep body and soul together.

            Forgive me if I sound harsh but the way this feels to me is just another slap in the face to those who have been suffering without the hope of work, who have already lost their homes, etc etc.

            'We Will Not Be Co-opted' ~Jesse LaGreca

            by Annalize5 on Mon Oct 24, 2011 at 05:57:44 PM PDT

            [ Parent ]

            •  Sorry... (2+ / 0-)
              Recommended by:
              cany, Annalize5

              ...but to dismiss a program that will help some people because it doesn't help everyone just seems foolish.

              Exactly what do you think the president can do to hep those who are long-term jobless and have run out of money, without getting the approval of the congress?

              Political Compass: -6.75, -3.08

              by TexasTom on Mon Oct 24, 2011 at 07:11:27 PM PDT

              [ Parent ]

              •  Well, Tex, dunno if I could say... (0+ / 0-)

                exactly, BUT (!) given his ability to pronounce the edict he just pronounced, it would seem to me his heart wasn't in doing something, anything (w/o congressional consultation) untilllll.....

                his upcoming bid for re-election?

                Wait...maybe somethin' along these here lines:

                what would be helpful is about 2 years amnesty where I could put the mortgage payment back into the house and repair the

                windows~ old and falling apart

                Bathroom and Kitchen~ severe water damage

                etc.

                'We Will Not Be Co-opted' ~Jesse LaGreca

                by Annalize5 on Mon Oct 24, 2011 at 07:37:59 PM PDT

                [ Parent ]

                •  Danged link didn't take... (0+ / 0-)
                  This isn't what I need (1+ / 0-)

                  I don't need to refinance. I am underwater in my mortgage.

                  I need to make major repairs in my home, but what is the point of sinking more money into a house that I can't sell for what I owe?

                  It makes more sense to walk away right now.

                  what would be helpful is about 2 years amnesty where I could put the mortgage payment back into the house and repair the:

                  windows~ old and falling apart

                  Bathroom and Kitchen~ severe water damage

                  etc.

                  Nice try though.

                  I'll believe corporations are people when Texas executes one.

                  by Hkpa on Mon Oct 24, 2011 at 06:21:46 PM PDT

                  'We Will Not Be Co-opted' ~Jesse LaGreca

                  by Annalize5 on Mon Oct 24, 2011 at 07:41:16 PM PDT

                  [ Parent ]

              •  I think you're being overly harsh... (0+ / 0-)

                ... I don't think he/she was "dismissing" the program.  I suspect that you could be interpreting the comment in the most negative light rather the most positive.

            •  I also get that. (1+ / 0-)
              Recommended by:
              Annalize5

              But I guess I don't feel like doing nothing is preferable to doing something good even though it's not all that should be done.

              Also, I'm not supporting this action for me even though it does help me.   It's going to be an effective stimulus for almost no cost.  This is good for all Americans.  And it's not all that we should be doing but it's better than not doing it.  And it's what Obama can do by executive order.

              •  Agree with you, BrowniesAreGood... (1+ / 0-)
                Recommended by:
                BrowniesAreGood
                But I guess I don't feel like doing nothing is preferable to doing something good even though it's not all that should be done.

                Sometimes I can almost hear Wordsworth whispering in his angst and frustration at the "Devil's Bargain" humanity has made with his interior life.

                The world is too much with us; late and soon,
                Getting and spending, we lay waste our powers;
                Little we see in Nature that is ours;
                We have given our hearts away, a sordid boon!
                ~ William Wordsworth

                Forgive me, I sometimes get like this. I am glad for you, I meant that.

                'We Will Not Be Co-opted' ~Jesse LaGreca

                by Annalize5 on Tue Oct 25, 2011 at 01:08:33 AM PDT

                [ Parent ]

    •  It will help a number of people with good credit . (10+ / 0-)

      Imagine you have a house that was worth $400,000 when you first financed it, but will assess for $300,000 now.

      If you go in to refinance, the bank will ask you to pay down the mortgage ... they can't finance more than 80% of $300K = $240K. That means you will need to put up a lot of money that you may not have, despite your excellent credit.

      What Obama is doing is allowing you to refinance at that $400,000 value without requiring a new assessment.

      I have seen someone say that it will help 600,000 to 1 Million underwater buyers.

      •  Better estimates (3+ / 0-)
        Recommended by:
        BigAlinWashSt, michelewln, askew

        Here:

        Barclays Capital analysts said the FHFA estimate could be low, considering there are 1.65 million loans originated before June 2009 – the origination cut off is May 2009 – and hold a loan-to-value ratio between 80% and 125%. Another 240,000, they said, are above 125% LTV, which would still qualify as the ceiling was removed. They peg the final eligibility universe to be between 1.9 million and 3.1 million borrowers.

        "The administrations estimates are much lower than those numbers; we believe the overall number could be higher, given the substantial effect of putback waivers," BarCap said.

      •  I don't think that's right. (0+ / 0-)
        Additionally, the current loan-to-value (LTV) ratio for the property must be greater than 80 percent.

        It appears to be no different than a conventional refi.  

        "Rules must be binding. Violations must be punished. Words must mean something." President Obama in Prague on April 5

        by jlynne on Mon Oct 24, 2011 at 04:26:48 PM PDT

        [ Parent ]

  •  Every little-big thing helps (13+ / 0-)

    and this little thing potentially helps millions.

    Which, on reflection makes this a big thing - or bigger than HARP turned out to be on first run.

    I did some back of the envelope calculations - it could help someone in 150K value home save perhaps as much as $1-2,000 per annum, (loan length dependent) shortening the life of the loan at the same time.

    For some that might be the lights left on. Or a down payment on a replacement, more fuel efficient automobile. Those window replacements or insulation upgrades to reduce heating bills.

    Or, just food. For two. For several months.

    Rick Perry executed a man ... just to watch him die

    by ItsSimpleSimon on Mon Oct 24, 2011 at 10:49:55 AM PDT

  •  Go big or Go home (15+ / 0-)

    we know how to fix this mess, We've been here before

    Home Owners Loan Corp

    Helping Home owners who are current, but underwater isn't a bad thing, though they are not first on my list of Homeowners who need help

    We Must help those who are right now facing default

  •  Please educate me (1+ / 0-)
    Recommended by:
    BrazenSerpent

    "Additionally, the current loan-to-value (LTV) ratio for the property must be greater than 80 percent."

    So does this mean people can take advantage even if they're not underwater? If the LTV is 81%, does this mean they can get a no-fee loan modification?

    •  Hope this helps clarify... (5+ / 0-)

      LTV refers to the percentage that results when the amount you owe on the loan is divided by the home's value. Thus, if your loan is for $80,000 on a $100,000 home, your loan to value would be 80,000 divided by 100,000 or 80%. That also means that you have 20% equity in your home.

      •  So... (1+ / 0-)
        Recommended by:
        gloriana

        "Underwater" means an LTV of greater than 100%?

        honi soit qui mal y pense

        by admadm on Mon Oct 24, 2011 at 02:07:28 PM PDT

        [ Parent ]

        •  Sort of. (2+ / 0-)
          Recommended by:
          askew, BrazenSerpent

          Using Brazen's example, say you originally took out an $80,000 loan for the home, but now the home is only worth 70k, rather than the 100k when you started.  You are now underwater: the loan you're paying off is larger than the home is worth.   So in order to refinance it, you'd need to take out a loan of over 100% LTV:  80k for a 70k house.

          HARP loans allow for up to 125% LTV,  but even that value was too low in cases, given the property value declines across the country.

          Another provision of this morning's announcement not mentioned in the above article is that the "125% LTV ceiling" restriction is being lifted for fixed loans (ARMs are still being held to 105% LTV).

          This is huge -- about as huge as the reps and warrants relief.  And I'm not seeing an upwards limit being announced, either, though details are still forthcoming.

          All and all very promising.  I'm going to be very interested in seeing the details.

          "Spread happiness" -KO

          by gloriana on Mon Oct 24, 2011 at 03:44:30 PM PDT

          [ Parent ]

  •  All I see is more taxpayer financed and guaranteed (15+ / 0-)

    money going to the banks.    Again no risk or incentive for the banks to do an honest job.  

    Yes we can, but he won't.

    by dkmich on Mon Oct 24, 2011 at 01:08:21 PM PDT

    •  Leopards don't change their spots (6+ / 0-)

      Further proof this administration really believes in betting on the replay of a horse race.  

      I also thank the one who rearranged deck chairs on the Titanic so those on board ship could get a better view of the iceberg.

      by NyteByrd1954 on Mon Oct 24, 2011 at 01:10:59 PM PDT

      [ Parent ]

      •  So, you're saying... (1+ / 0-)
        Recommended by:
        cany

        ...that we should prevent people who are in underwater loans from being able to refinance to current rates because it might help the banks, as well?

        Really, I don't see that it does, anyway -- it will reduce interest income by allowing folks with currently performing loans at relatively high interest rates refinance to lower rates.  That doesn't seem like a big benefit to the banks.

        Political Compass: -6.75, -3.08

        by TexasTom on Mon Oct 24, 2011 at 07:14:42 PM PDT

        [ Parent ]

        •  Trust me Texas Tom, there was a diary on (1+ / 0-)
          Recommended by:
          TexasTom

          this topic early this morning and YES a lot of people said if it helps the banks we should let the people drown.

          I don't agree...

          We need to help people AND fix the banks, not an either or.

          202-224-3121 to Congress in D.C. USE it! You can tell how big a person is by what it takes to discourage them.

          by cany on Mon Oct 24, 2011 at 07:33:04 PM PDT

          [ Parent ]

        •  No, I'm not saying (1+ / 0-)
          Recommended by:
          dkmich

          No, I am not saying the words you wish to put in my mouth.  

          What I'm saying is Obama has not learned a damned from his first failed program which is why he's doubling on the same type of program again.  

          I also thank the one who rearranged deck chairs on the Titanic so those on board ship could get a better view of the iceberg.

          by NyteByrd1954 on Mon Oct 24, 2011 at 10:24:07 PM PDT

          [ Parent ]

        •  No.... Why must it be all or nothing? (1+ / 0-)
          Recommended by:
          NyteByrd1954

          Help the people and cut the banks out.   I don't trust the banks not to abuse whatever program they touch.   How about we let North Dakota's state bank run the program and cut out the rest?  

          Yes we can, but he won't.

          by dkmich on Tue Oct 25, 2011 at 02:14:49 AM PDT

          [ Parent ]

    •  Oh, I don't know (5+ / 0-)

      Yes, this is going to most certainly help banks.  This statement in the diary says so, actually:

      "Removing reps and warranties has the potential to unleash competition for housing refinance," Sperling said on the call. It makes taking on loans less toxic, and opens up new potential business for banks.

      But, it'll help those individual homeowners that are in dire need of this so as not to lose their homes as well.  I'm thinking it can be a win/win.  Yes, right now even the word "bank" is yuk-city to us, but with proper monitoring and oversight, they can provide a service and be excellent corporate citizens while being up front and honest in their dealings with the public.

      - If you don't like gay marriage, blame straight people. They're the ones who keep having gay babies.

      by r2did2 on Mon Oct 24, 2011 at 01:22:40 PM PDT

      [ Parent ]

      •  Will somebody please explain what bank reps and (3+ / 0-)
        Recommended by:
        jlynne, dkmich, Mrs M

        warranties are being waived and why? I look at this and wonder if what I am looking at is a waiver which allows a bank claiming to hold servicing or the note is being excused from warranting that it owns the servicing or note and in fact holds the right to modify them, so that it may be that the bank with whom the refi deal is being done does not in fact own it or have the right to modify it, and the borrower may be left with two loans, the quitclaim like refi and the original mortgage held by a Trustee for bondholders who consented to nothing at all.  Someone, please explain what reps and warranties are being waived and why.

        This is especially important as the only loans involved are those owned or guaranteed by Fannie and Freddie, and the question at the core is whether Fannie and Freddie are liable to third parties, possibly not the bank doing the refi, as guarantors for the gap between the original amount and payments therein at the interest rate specfied, and the refi deal done by the non warrantee bank who gets the cash.

  •  Mostly on board with this. (1+ / 0-)
    Recommended by:
    TofG

    It needs to be done, but it really makes me angry that the stated income fraud is going to be swept under the table when it was part of what got us into this mess in the first place.

    Same with the idiots who are underwater because they accidentally confused their house with a cash machine.

    •  you know, you didn't have to be an idiot to watch (1+ / 0-)
      Recommended by:
      Annalize5

      housing values plummet 35 percent--which is where things stand in much of the country-affecting everyone.  Not just "idiots,"  as you so charmingly put.  

      "We can have democracy in this country or we can have great concentrated wealth in the hands of a few, but we cannot have both." Justice Louis Brandeis

      by livjack on Mon Oct 24, 2011 at 03:27:55 PM PDT

      [ Parent ]

  •  I did HARP about a year ago... (9+ / 0-)

    ...it was alot of extra paperwork back then, but saved me a nice little chunk of change.  Happy to hear the next round of people using HARP might get to go through a little less stress -n- paperwork than I did.

    You get back what you put in and people get what they deserve - Kid Rock

    by Devil Without A Cause on Mon Oct 24, 2011 at 01:10:23 PM PDT

  •  It's interesting that the tv media, perhaps in (2+ / 0-)
    Recommended by:
    r2did2, Deep Texan

    spite of themselves, can't seem to help but give this initiative a positive spin. (Can't speak for Fox, though).
    Even if there are qualifiers (small overall effect) it comes out as Obama trying to help millions of homeowners. And, of course, there should be the reflexively negative comments by Republicans-don't see how they can help themselves, what with their Obama Derangement Syndrome affliction.

  •  bah (7+ / 0-)

    another band aid for a sucking chest wound. This helps a few people tread water, doesnt change much else though.

    The people who really need the help, wont qualify, and this just allows many people to keep paying a house not worth its mortgage.

    Bad is never good until worse happens

    by dark daze on Mon Oct 24, 2011 at 01:15:00 PM PDT

  •  If Obama does not go on the War Path at home.... (2+ / 0-)
    Recommended by:
    cocinero, davidincleveland

    he will lose to a real loser....anyone in the list of Candidates running for office.  It is time to take an FDR stand, Mr. President, and anytime you feel weak. or want to fret over the GOP, replay that famous speech FDR made when he was trying to get re-elected.  It is awesome!

  •  Impact not Housing but Consumer Spending & Taxes (3+ / 0-)
    Recommended by:
    cocinero, ohmyheck, Betty Pinson

    This program's  impact on housing will mainly be to reduce the rate that people walk away from a house that has a mortgage value higher than the house value.  This will have a minor impact on house prices.

    More importantly, if the person's interest payments drop by $2,000/yr that is $2,000 (minus the tax benefit of the mortgage interest) that can go to consumer spending.  Those who use the program will also pay more in income taxes as their interest deduction will be lower.

    There will also be some employment resulting from those who need to move the transaction papers around.

    The reduction in the interest rate does not hurt the Federal Government or Fannie or Freddie, as the old mortgage gets treated as a mortgage that was paid off - and the corresponding bonds get paid off early.  Meanwhile, Freddie or Fannie then issues new mortgage backed bonds at todays very low interest rates.

    The cost to the federal government should be low to actually making money on it through higher tax collections.

    The most important way to protect the environment is not to have more than one child.

    by nextstep on Mon Oct 24, 2011 at 01:21:07 PM PDT

  •  Mostly a stimulus program (we like stimulus!) (11+ / 0-)

    but also helps homeowners by (1) giving them cushion in case they hit difficulties down the road and (2) giving people less incentive to engage in a strategic default.  

    For people who pay their bills on time, bust their ass to make a living, and play by the rules, but have been screwed due to the crash of the housing market, this is a great thing.  

    "[R]ather high-minded, if not a bit self-referential"--The Washington Post.

    by Geekesque on Mon Oct 24, 2011 at 01:21:41 PM PDT

  •  Wait, what? (7+ / 0-)

    So we're solving problems of unclear title by just paying whichever random person who says they have title?

    Well, that's certainly . . . one . . . way to do it.  It will definitely make the banksters a pile of money.

    The two things Teabaggers hate most are: being called racists; and black people.

    "It takes balls to execute an innocent man." -- anonymous GOP focus group member on Rick Perry

    by Punditus Maximus on Mon Oct 24, 2011 at 01:23:59 PM PDT

    •  Yeah, I saw that too... (3+ / 0-)
      Recommended by:
      aliasalias, jlynne, davidincleveland

      what I wanna know is if that is possible now by Executive Decree...why the hell wasn't something like it possible before people lost their homes~!!!???

      My God, I remember reading all that robo-signing stuff in Florida. Looks like it's all ok now...just erase the blackboard now boys, start all over. All is forgiven, now go make another killin'~!

      'We Will Not Be Co-opted' ~Jesse LaGreca

      by Annalize5 on Mon Oct 24, 2011 at 01:35:18 PM PDT

      [ Parent ]

  •  What ar ethese reps and warranties... (6+ / 0-)

    ...that are being waived, and why were they required in the first place?

    We reach for the stars with shaking hands in bare-knuckle times.

    by TheOrchid on Mon Oct 24, 2011 at 01:28:40 PM PDT

  •  Another bailout for Bank of America (7+ / 0-)

    Once you take advantage of this program, the GSE lose any rights to put back. I believe Bank of America has these loans worth about 50-300 billion, thanks to Countrywide.
    Also this will automatically turn your loan into a recourse loan. Watch out if your present loan is non recourse.
    Geithner and Ben never do anything that does not help the big banks at the expense of the taxpayer.

  •  Restructuring is what's needed. (0+ / 0-)

    But that would take a miracle to get the GOP on board. Fixing our economy is a much bigger problem than what can be done with executive orders alone, and reducing the huge debt overhang is an essential part of economic recovery.

    A more ambitious plan has been proposed:

    Their second solution involves restructuring the mortgage debt that is crushing so many Americans. It is a complex proposal that involves, for some homeowners, a bridge loan, for others, a reduction in mortgage principal, and, for others still, a plan that allows them to rent the homes they live in with the prospect of buying them back one day.
  •  out-of-luck (1+ / 0-)
    Recommended by:
    davidincleveland

    my son and his wife, in CA, lost over 50% of the value on their home; their mortgage was not  owned or guaranteed by Freddie Mac/Fannie Mae; they are current o their mortgage payments; their current interest rate is well above 6%; they do not qualify for a short sale; their lending institution will not allow them to refinance; their Fico scores is in 800's.

    Whatever the Prez offered today, will not help them at all.

     

  •  Talk about a load of bullshit . . . (11+ / 0-)

    this is a couple of three dump trucks full . . .

    a key new condition in the plan would shift the financial liability for refinanced loans from Wall Street banks to the American taxpayer. And by focusing on lower payments, the program does not confront what housing experts view as the core problem in the foreclosure crisis -- borrower debt that exceeds the value of one's home . . .  The newly expanded program would expunge legal liabilities associated with mortgages refinanced through the program for the original lenders of the mortgages. Each time a bank sent a loan to Fannie and Freddie, it certified that the loan met Fannie and Freddie's safe lending criteria. But many loans sent to the mortgage giants did not, in fact, meet those criteria. Currently, when borrowers default on those ineligible loans, the mortgage giants can "put back" the resulting losses onto the banks that pushed the loans.

    Under the modified plan, "put back" liability at banks will be erased for any underwater mortgage that is refinanced through HARP, eliminating Fannie and Freddie's ability to sack lenders with losses in the event that the mortgage does not pan out.

    If borrowers go through HARP, but decide after several months that the modest monthly savings do not outweigh owing tens of thousands of dollars more than their home is worth, taxpayer-owned Fannie and Freddie will have to take the full loss. Even if the original loan was sent to Fannie and Freddie with false or fraudulent guarantees from the bank -- promises that may directly be tied to the borrower's current financial problems -- banks will be immune from liability.

    I tremble for my country when I reflect that God is just; that his justice cannot sleep forever. ~Thomas Jefferson

    by bobdevo on Mon Oct 24, 2011 at 01:43:11 PM PDT

    •  I agree. This plan is Bullshit. (1+ / 0-)
      Recommended by:
      bobdevo

      All homes should be reappraised downward and the interest rates capped for everybody at 4% and reamortized.

      •  Seriously, How does that happen? (2+ / 0-)
        Recommended by:
        michelewln, wishingwell

        Not to rain on your parade, but that is just not realistic.   It seems to me that when we are criticizing plans that have been presented and can actually be implemented, it is unhelpful to suggest a plan that is completely impossible.  

        •  I think if the gov't underwrote the loans (0+ / 0-)

          they can now dictate the terms.

          The people that need help are those that are struggling, not those that are handling their payments and might strategically default.

          •  the terms to a loan are agreed upon before (0+ / 0-)

            the loan is issued.  One party can't change the terms after the deal has been made.  I would think that would be obvious.  

            There are definitely people struggling that will not be helped by this plan.  It doesn't fix everything.  However, those who will be helped are also struggling.  There are many people who are keeping up with their payments...barely.  They are on the verge of default, and refinancing will help them.  (the idea that they will strategically default or not is not true of the entire population.

            this is a complicated issue.  There isn't a magic bullet that will fix everything, and there isn't a simple answer that doesn't have consequences.

            Many here seem to think that if a solution may possibly benefit the banks that it is bad, even if it also benefits many people.  There are others that think that it must help everyone or it isn't a good idea.  It seems like to me that people are looking at this problem way too simplistically.  

            •  What happened to the PMI? (0+ / 0-)

              And the Federally underwritten insurance that accompanies gov't underwritten loans?

              All this talk about how the banks got bailed out, and yet they still have foreclosures/losses on the books. Every single one of the house loans that were 80.1% over LTV had to have insurance. Where did it go?

    •  Gah~! noooooo more...! :( n.t (2+ / 0-)
      Recommended by:
      bobdevo, davidincleveland

      'We Will Not Be Co-opted' ~Jesse LaGreca

      by Annalize5 on Mon Oct 24, 2011 at 02:01:44 PM PDT

      [ Parent ]

    •  from your link, this stuff has Bankster prints (3+ / 0-)
      Recommended by:
      bobdevo, WisePiper, Annalize5

      all over it. What a surprise, especially when Obama has received more money from Wall Street than all nine Repub contenders...combined. Then there is the matter of his Staff being execs from GE and JP Morgan/Chase Manhattan,... people with a real interest in what's best for Main Street instead of Wall Street.  Right.

      During a conference call with reporters, Department of Housing and Urban Development Secretary Shaun Donovan acknowledged that negative equity is a problem, and said the administration hopes to address the issue on other fronts. Donovan cited settlement negotiations with big banks over widespread allegations of foreclosure fraud and initiatives under the Home Affordable Modification Program, a separate Obama foreclosure-relief plan administered by banks, as key initiatives.
      New York Attorney General Eric Schneiderman and Delaware Attorney General Beau Biden have both objected to the foreclosure fraud settlement talks on the grounds that they give away too much to banks without investigating the scope of fraud problems in the system. The Home Affordable Modification Program has been a hotbed for the kind of borrower abuses that the administration is pressuring lenders to settle. over.

      (emphasis mine)

      without the ants the rainforest dies

      by aliasalias on Mon Oct 24, 2011 at 02:26:48 PM PDT

      [ Parent ]

  •  Please Explain Why the Following is a Bad Idea (2+ / 0-)
    Recommended by:
    WheninRome, NoMoreLies

    What would have been the effect of Obama announcing on Jan 22, 2009, that any financial institution that had received a TARP bailout could NOT foreclose any any residential property?

    Because banks foreclosing after having their toxic a$$ets relived appears to me to be the ultimate in double-dipping.

    Then again, I'm not an economic genius like geithner or summers...

    I am not now, nor have I ever been, a member of the Republican Party.

    60% of White-Americans voted for the TeaBigots in 2010. Yet, some Kossacks think Obama is the problem. I guess it's easier to blame Obama than it is to blame your momma

    by OnlyWords on Mon Oct 24, 2011 at 01:44:44 PM PDT

  •  Iwasn't going to comment, but....... (5+ / 0-)

    I am getting pretty sick and tired of the negativity surrounding everything Obama tries to do. We get enough of that from the Republicans.

    Is this order perfect ? No!

    I wish I could qualify, but I don't think I can.

    Yet if this helps someone else, I am glad.

    Let's all throw on our purity coats and lay all the blame on Obama, Geitner, Bernanke and any others you decry as "too Wall St."

    Enough. The man can do just so much. He can't nationalize the banks. So let's get more regulation and learn to deal.

  •  Bail Me Out (1+ / 0-)
    Recommended by:
    davidincleveland

    I'm not eligible for this programme, because I bought a house that didn't lose most of its value. That was not an accident: I purposely made one of the biggest investments of my life after considering the risks. My mortgage isn't easy to pay, even after I refinanced a year ago. I had to pay a lot in costs that this programme would have saved me. If I had that money now I'd spend it on my neighbors' labor and products, rather than on the bank that's keeping it.

    Because I did the right thing, I'm not getting bailed out. And my neighbors aren't getting as much of my help in working their way out of the recession.

    "When the going gets weird, the weird turn pro." - HST

    by DocGonzo on Mon Oct 24, 2011 at 02:05:15 PM PDT

  •  I like the waivers, which will in effect cut prior (0+ / 0-)

    creditors out.  Result: if they have a good, provable loan, they can sue the new lender, not the homeowner.  If they don't, then screw em.  Its their own damn fault and they should eat the loss.

    More of this please.

  •  Side Note: Twitter & "We Can't Wait" (0+ / 0-)

    From TalkingPointsMemo.com

    "Republicans don’t have the White House’s megaphone, but give them credit for creativity.

    They’ve co-opted President Obama’s new jobs mantra, “We Can’t Wait,” and turned it around on Democrats. On Twitter.

    For the most part, Republicans are using the hashtag, #WeCantWait, to pressure Senate Democrats to pass House-passed anti-regulation legislation. They claim those bills will grow the economy, quickly, though most experts disagree."

    http://tpmdc.talkingpointsmemo.com/...

    This whole world's wild at heart and weird on top....Lula

    by anninla on Mon Oct 24, 2011 at 03:15:28 PM PDT

  •  Underwater Mortgages aren't helped. (1+ / 0-)
    Recommended by:
    Annalize5

    I can see where people in Rapid City SD where I am now might benefit - lower interest/house payments.  But in Phoenix where I spend my winters, it is useless.  I had hoped it would address underwater mortages.

    "The man who speaks to you of sacrifice is speaking of slaves and masters, and intends to be the master." Ayn Rand

    by aznavy on Mon Oct 24, 2011 at 03:26:17 PM PDT

  •  This isn't what I need (1+ / 0-)
    Recommended by:
    Annalize5

    I don't need to refinance. I am underwater in my mortgage.

    I need to make major repairs in my home, but what is the point of sinking more money into a house that I can't sell for what I owe?

    It makes more sense to walk away right now.

    what would be helpful is about 2 years amnesty where I could put the mortgage payment back into the house and repair the:

    windows~ old and falling apart

    Bathroom and Kitchen~ severe water damage

    etc.

    Nice try though.

    I'll believe corporations are people when Texas executes one.

    by Hkpa on Mon Oct 24, 2011 at 06:21:46 PM PDT

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