Category Archives: Mortgage Information

Fiscal Cliff Bill Extends Tax Relief for Struggling Homeowners Facing Foreclosure

Posted on January 7, 2013 | Leave a comment

Expiring tax exemptions for homeowners facing foreclosure, a relatively uncontroversial response to the foreclosure crisis that had lingered for months on Congress’ to-do list, will be extended in the fiscal cliff deal approved late Tuesday.

Debt canceled through a foreclosure, a short sale or a loan modification on a primary residence was considered taxable income until 2007’s Mortgage Forgiveness Debt Relief Act. Under the fiscal cliff bill passed by Congress and awaiting the president’s signature, that forgiven debt will remain untaxed for another year.

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Without an extension, short sales and loan modifications would have come with an increased tax burden on an already struggling homeowner. That would likely have pushed more to fight foreclosure, dragging out the impact of the foreclosure crisis on the housing market.

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2013 New Law – Homeowner Bill of Rights

Posted on January 1, 2013 | Leave a comment

The new year will bring more protections to California homeowners, mainly those who are trying to save their properties from being repossessed.

The Homeowner Bill of Rights, signed by the governor last year, is a set of new laws that puts the onus on banks to help consumers through the foreclosure process. They go into effect today. The legislation, lauded by housing advocates and heavily criticized by the lending industry, forces banks to:

• Stop dual tracking, the process of starting the foreclosure process while a loan modification has been submitted or is being reviewed by the bank. Borrowers in the past have lost their homes to foreclosure as a result of this situation. Under the new law, banks must give loan-modification applicants a response before starting the foreclosure process. Banks also will have to inform consumers who don’t apply for a loan modification that they have the right to do so.

• Stop robo-signing, the process of approving foreclosure documents without proper review.

• Assign one point of contact to borrowers who are trying for a loan modification.

One of the laws also allows borrowers to sue loan servicers for violating any foreclosure laws.

Some of the provisions in the package echo those in the national mortgage settlement, a deal struck earlier last year between five major lenders and 49 states, including California. The Homeowner Bill of Rights, though, firms up those provisions into law, which is key because the mortgage settlement terms will end in 2015.

“For too long, struggling homeowners in California have been denied fairness and transparency when dealing with their lending institutions,” said California Attorney General Kamala Harris in a statement. “These laws give homeowners new rights as they work through the foreclosure process and will give Californians a fair opportunity to stay in their homes.”

Homeowner advocates also applauded the legislation.

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Ease and Risk of Online Loan Shopping

Posted on August 18, 2012 | Leave a comment

With mortgage rates at historic low levels, now may be a good time to buy or refinance a house, and the Internet has made it easier than ever to shop for a mortgage.

There’s no longer a need to pound the pavement going from one bank to another comparing rates or to spend hours on the phone supplying loan officers with information when you can get quotes from multiple lenders by filling out one application online.

But shopping online can sometimes mean providing your Social Security number to a website in order to get a mortgage rate — a process that disturbs some consumers and industry experts.

“There are probably eight to 10 criteria that are required to accurately price a mortgage, and a Social Security number is not one of them,” said Rick Allen, chief financial officer at Mortgage Marvel, a Milwaukee-based company that provides online quotes for mortgage rates and closing fees.

Not all mortgage websites ask applicants for Social Security numbers and other detailed personal and financial information.

Mortgage Marvel recently conducted a side-by-side comparison of the four leading mortgage lender websites — Bankrate, Zillow, Mortgage Marvel and Lending Tree — and found that Lending Tree is the only one that asked applicants to provide a Social Security number to receive a mortgage rate.

Disclaimer: for information and entertainment purposes only

Category Archives: Mortgage Information

Fiscal Cliff Bill Extends Tax Relief for Struggling Homeowners Facing Foreclosure

2013 New Law – Homeowner Bill of Rights

Ease and Risk of Online Loan Shopping

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