Category Archives: Mortgage Information

Government Threatens to Dump Lenders from VA Loan Program

Nine lenders have been warned by the U.S. that they will be kicked out of a top mortgage program within months unless they find ways to stop costly rapid refinances of veterans’ loans.

The warnings stem from a probe by Ginnie Mae, a government-owned corporation that makes mortgages cheaper by protecting bond investors against homeowner defaults. Ginnie Mae guarantees about $2 trillion in bonds containing loans backed by agencies including the Department of Veterans Affairs.

Some lenders have boosted their revenue through repeated, unneeded refinancing of veterans’ home loans, according to regulators. That process, called “churning,” lowers prices investors are willing to pay for bonds, effectively raising rates for veterans, first-time home buyers and others whose loans are included in Ginnie Mae-backed securities.
The targeted lenders include NewDay Financial and Nations Lending Corp., which were given 30 days to respond to the letter, according to a person familiar with the matter. Others, including Freedom Mortgage Corp., LLC and Flagstar Bank, were given 60 days, according to the person.
disclaimer: for information and entertainment purposes only

FHA won’t insure new mortgages with PACE loans

The Federal Housing Administration will stop insuring new mortgages on homes with PACE loans, a type of financing used to fund energy-efficient home improvements.

The announcement Thursday followed criticism from consumer groups that too many borrowers have taken out unaffordable loans for solar panels and other projects after contractors misrepresented how the financing works.

In announcing the policy change, the FHA said PACE loans lack sufficient consumer protection. When a borrower with an FHA-backed mortgage is foreclosed upon, the portion of the PACE loan in arrears must be paid off first.

The remaining PACE loan transfers to the new buyer, but the FHA said that increases the likelihood the buyer will pay less, making it more difficult for the agency to meet its obligations.

read more at:

disclaimer: for information and entertainment purposes only

HARP (Home affordable refinance program) extended to Dec 2018

HARP, or the Home Affordable Refinance Program, is a great way to refinance your mortgage and save a ton of money in interest charges.

HARP allows homeowners who have little or no equity in their homes to refinance their mortgages and get lower interest rates. You can even refinance if your mortgage is upside down.

The program was due to expire in September, but it has been extended through December 2018, adding 15 months to this popular initiative.

The 2008 housing crisis left many homeowners owing more on their mortgages than their homes were worth. The rate of foreclosures rose 81 percent in 2008 alone and more than 860,000 homeowners lost their homes.

read more at:

disclaimer: for information and entertainment purposes only