theBigD_IHB
New member
What kind of an effect will this have on the housing market? Especially in CA.
Mortgage Rescue Plan Set To Pass
Mortgage Rescue Plan Set To Pass
Looks like the bill will pass
- Thread starter theBigD_IHB
- Start date
NEW -> Contingent Buyer Assistance Program
amd the homeowner has to agree to share future profits with the bank and FHA.
Yeah, you as a homeowner opt for this and you have to share the gains going forward.
I see little uptake on the bill.
Your dumb neighbor's dumb back isn't going to write down the principal for your dumb neighbor to qualify for this. His house is going back to the bank, will sell for much less than the $600K you owe and that will suck, but dumb neighbor will be trying to find a landlord who will rent to someone with a 500 credit score.
which is exactly why the FHA backed refinances won't work... The 2nd holders aren't going to get anything back regardless of whether the place goes into foreclosure, sells short is refinanced by an FHA backed loan. The losses are bad enough for first lien holders, but man the seconds literally are worth ZERO.
Trooper,
I'm trying to scoop up a nice short sale property and your statement applies to it. The seller got injured and I believe has the inability to go back to work which shows real financial hardship in order to qualify for the short sale. The 1st mortgage already gave the go signal and the 2nd refuses to budge since they get zero back.
This is my understanding as well. I hope there is not more here. This plan fails the fairness test. People who couldn't afford to purchase homes did so anyways by utililizing loans that they knewshould have known would quickly result in mortgage payments that they knew they could never afford in a million years. As a result of their lack of good judgement home prices soared well beyond the means of those of us who chose to be fiscally responsible. This is such nonsense.
stepping_up_IHB
New member
As I've been reading it, the principal has to be reduced to 85% of the current market value in order for FHA to insure the refinance. This means all the second holders have to agree to take nothing and the first mortgage holder has to take a hit as well. If the banks aren't willing to accept those terms to approve a short sale, why would they approve them for a refinance backed by the FHA? The banks have the opportunity to achieve this result today without this bill.
No_Such_Reality_IHB
New member
stepping_up said:
amd the homeowner has to agree to share future profits with the bank and FHA.
Yeah, you as a homeowner opt for this and you have to share the gains going forward.
I see little uptake on the bill.
PadreBrian_IHB
New member
This sucks for people who didn't get those shitty shitty option-arm zero down loans!
Now your dumb neighbor only owes 500k for his house and you still owe 600k or you 30 year fixed. WTF?!
Now your dumb neighbor only owes 500k for his house and you still owe 600k or you 30 year fixed. WTF?!
stepping_up_IHB
New member
PadreBrian said:
Your dumb neighbor's dumb back isn't going to write down the principal for your dumb neighbor to qualify for this. His house is going back to the bank, will sell for much less than the $600K you owe and that will suck, but dumb neighbor will be trying to find a landlord who will rent to someone with a 500 credit score.
PadreBrian_IHB
New member
Pardon the bad typing.
Stepping, I think at 85% of the new TLV means ANYONE can qualify for this stupid program.
Stepping, I think at 85% of the new TLV means ANYONE can qualify for this stupid program.
stepping_up_IHB
New member
they can qualify, but the lenders have to agree to it.... not going to happen. the lenders can accept short sales under these terms today and they aren't doing it. Lord only knows why, but I'm beginning to believe Lawyer Liz that banks really are just stupid.
Trooper_IHB
New member
Someone else said short sales aren't working b/c the 2nd mortgage holders aren't agreeing to a total loss. I mean, most, if not all, of the 2nd is going to be wiped out.... So the bank that holds the 1st might agree, but when the 2nd holder doesn't , the whole thing falls apart and is a waste of everyone's time. Not sure though.
stepping_up_IHB
New member
Trooper said:
which is exactly why the FHA backed refinances won't work... The 2nd holders aren't going to get anything back regardless of whether the place goes into foreclosure, sells short is refinanced by an FHA backed loan. The losses are bad enough for first lien holders, but man the seconds literally are worth ZERO.
arctichaze_IHB
New member
Trooper said:
Trooper,
I'm trying to scoop up a nice short sale property and your statement applies to it. The seller got injured and I believe has the inability to go back to work which shows real financial hardship in order to qualify for the short sale. The 1st mortgage already gave the go signal and the 2nd refuses to budge since they get zero back.
Trooper_IHB
New member
Sounds like you are stuck then. Just keep in touch with the 1st people and let them know you will take it off their hands immediately when the foreclosure happens ! ;-P
JimJones_IHB
New member
stepping_up said:
This is my understanding as well. I hope there is not more here. This plan fails the fairness test. People who couldn't afford to purchase homes did so anyways by utililizing loans that they knewshould have known would quickly result in mortgage payments that they knew they could never afford in a million years. As a result of their lack of good judgement home prices soared well beyond the means of those of us who chose to be fiscally responsible. This is such nonsense.