Help for the housing market!

It appears the banks are finally realizing that it is better to help in a short sale process before the homeowner is behind in mortgage payments. Many banks are now telling borrowers to call them before they fall behind and try to work out a short sale process that is easier on them and the bank. This is truly a step in the right direction. Until now many banks wouldn't even talk to a borrow until they were 2 to 3 months behind in their mortgage payments. Even FHA is stepping up effort to help homeowners before they lose their home. According to the HUD website "Homeowners with FHA-insured mortgage loans who are experiencing financial hardship are now eligible for loss mitigation assistance before they fall behind on their mortgage payments. Previously, these homeowners were not eligible for such assistance until after they had missed payments. The Helping Families Save Their Home Act of 2009 signed into law by President Obama expanded FHA's authority to use its loss mitigation tools to assist FHA borrowers avoid foreclosure to include those facing "imminent default" as defined by the Secretary. FHA today issued guidance to FHA-approved loan servicers on how to assist these FHA borrowers."

MORE HOUSING NEWS:

The pending home sales index increased to 96.6% in December from a level of 95.6% in November. The index plunged in November in conjunction with the original expiration of the homebuyer tax credit and has not yet rebounded significantly. Now that the tax credit has been extended and expanded, the pending home sales index and thus existing home sales are expected to increase over the next several months.

The MBA mortgage applications index surged 21.0% to 620.7% for the week ending January 29. The purchase index increased 10.3% on the week as the refinance index rose 26.3%. Refinancing activity accounted for slightly less than 70% of new mortgage application activity. Despite this week's gains, the level of mortgage activity remains quite low indicating stagnation in the housing recovery.