Is this a Reality Game gone wrong? US Representative Marcy Kaptur pleads for Real Reform Now.
Watch her Rules to Wall Street Bailout Game: http://www.youtube.com/watch?v=S27yitK32ds&NR=1 If you had any doubt about it, just read a little history on the formation of the Federal Reserve Bank and how they were formed at 1-4am by a very small group if political insiders. This very group of political insiders is now seeking to, as Rep Kaptur suggests, Privatize Gains and Socialize Losses.
Some very insightful economic and political people are telling us they have sufficient evidence that our current economic mess was planned, yes planned. By whom?
Well look around and see who is benefitting...the big shots in high finance and government agencies including the CEO's of our regulatory and Government Supported Enterprises are square in our sights. Have you ever noticed how responsible businesses who treat their staff well and behave with social responsibly are still in business? We have watched with horror how, after 100+ years in business, a new CEO invests secretly in a shady sub prime company and whammo a trusted company is bankrupt inside 5 years. If financial institutions have not succumbed to the greed of inflating their books or selling worthless paper assets, these institutions are still performing well. Many many people who have behaved responsibly in their own financial matters are now expected to pick up the tab for those who have not.
Do you think our prudent banking system (created after the Depression) is doomed?
Do you think Congress can solve the situation?
If not, who do you trust to solve the problems in our economy?
Do you think criminal prosecution should be taken against Wall Street profiteers?
Wonder Why the Economic Rescue Bill Failed in Congress Today? Marcy Kaptur put it succinctly to the House of Representatives: http://tw.youtube.com/watch?v=mbD62gNi9WE
Rep Kaptur repeated her warnings that the process was being conducted behind closed doors...and rushed through Congress with unnecessary haste. http://www.youtube.com/watch?v=oAADyc6t4nY&eurl=http://www.infowars.com/?p=4931
The economists and main street bankers I have spoken with have expressed concerns that our Federal Reserve--a private institution--and their investors, including JP Morgan Chase, are attempting to reward the upper echelons of investors at the expense of the rest of us. When you can buy a bank (WaMU) worth $370 Million for $41 Million there is some unusual profit taking going on somewhere by someone. Express your concerns to your Congress persons! Express your concerns to your local media about how they cover this! Scare tactics only serve to raise fears exacerbating public confidence.
Who says we don't have money? Abundance is a way of thinking and behaving. Our ability to fund realistic mortgages for people who can afford them and can document their income has not been hampered...yes the paperwork has doubled, but the money is still there. Underwriters are doing business as usual under new guidelines. Mama has grounded us for abusing the rules. Once we observe them and pay our dues, we have a chance of getting our privileges back.
If your clients can't get la loan to buy a home, perhaps there is a reason...which would be_____________????
I fondly recall the image of John Travolta combing his hair while walking down the street to the Bee Gees singing 'Staying Alive' in Saturday Night Fever (reruns of course). That movie was really about a street smart guy using everything at his disposal including very fancy footwork to win against the odds. To identify with such a caricature is what it feels like to be a mortgage broker today. We are the creative, the resourceful, the get it done folks you know will find a way if anybody can.
However you may be affected by the horrible news going down in the financial world--I would like to stand in support of some very committed mortgage professionals I call my colleagues. While it is sad for us to watch our lenders (some very decent folks) one by one close their collective doors...it is obvious from where we sit that the biggest of our esteemed banks have been doing (to quote today's newscaster) "really stupid things!"
The Big Boys on Wall Street have come crying to Mama according to Representative Marcy Kaptur from Ohio...watch this link on youTube for one Congresswoman's public outcry:
http://tw.youtube.com/watch?v=mbD62gNi9WE
It is very hard to imagine what was going through the minds of certain Bank CEO's and their cronies at the top to allow such devaluation of their own financial systems. Was it a heady combination of greed, ego, denial and arrogance that they would not be caught? How many millions does a CEO need to be happy as they waltz out the door with their golden parachute? Whatever our regulators were doing to allow this to happen we will never know. It is apparent that the main elements of our delicate financial 'mobile' (to simplify: bonds, stocks, and mortgages) are wildly swaying against a backdrop of paranoia and fear (inflation). Today's inflation rate is double the standard comfort level of the Fed so something's gotta give and soon. The volatility and unpredictably of the market seems to have thrust everyone into over-correct mode...and we have seen every reaction from anger to stunned paraylsis.
Homeowners everywhere are suffering. If not in outright foreclosures, the loss of individual home equity is making it harder for first time homeowners to get enough to buy a home and seniors to get decent Reverse Mortgage terms. We have not seen our top Federal Officials show much concern about homeowners. Laws to date have been implemented in order to cover the behinds and pay the losses of the big boys by--you guessed it, we the people.
It's just not fair. The personal losses that will most certainly fall in the wake of massive corporate greed make it hard to justify the bailout of our misleaders at the top. While we in the Northwest are blessed, we have not suffered to the degree that our families in Nevada, California and Florida or the Midwest have. We do feel this devastation in our bones--we feel our lost innocence, dignity and hope...and our heart goes out to all those affected at this time. Rest assured the creative and resourceful among us will stay alive!
Stay sane out there! Loannetter
(c) 2008 susan templeton loannetter
Explore Loan Workout Options:
If you or your home owners have an Adjustable Rate Mortgage that is adjusting or have missed mortgage payments which has impacted your ability to refinance, you still have options in this market. Your lender may offer several 'loan workout' options including but not limited to: reinstatement, forbearance or a new repayment plan to suit your situation. When you call your lender directly ask for a supervisor for best result!
FHA officially offers a range of options including the new FHA Secure Plan for people needing to get out of ARM loans or who may be in arrears. There is also an FHA Rescue program being rolled out now. Not all lenders offer these plans. Even FHA is teetering on risk based pricing hits (translated: higher interest rates) to encourage lenders to fund these loans. Certainly you should speak with an FHA licensed broker or bank about whether you will qualify. Officially the FHA has not FICO score requirements but the banks who fund FHA loans have very strict limits and very few will fund under 580 FICO scores. Unfortunately, with guidelines tightening on all fronts, alternative credit reports are no longer acceptable in this market.
Mortgage Modification: For longer term issues impacting your ability to afford your current mortgage, you are advised to pursue mortgage modification with your current lender. Mortgage modification may help by adding missed payments to your current loan balance while adjusting the adjustable rate to a fixed rate. This may be accomplished by extending the number of years on your loan, thereby lowering the payment within your means.
Mortgage Insurance Loan: If your mortgage is insured (via Mortgage Insurance) you may qualify for a one-time interest-free loan from your MI guarantor to bring your account current and pay it back within a certain time frame. Your lender handles this process since they are essentially the insured party.
Private Options: I've been speaking with several private lenders about options... but they are very strict on minimum 580 to 600 FICO Scores in this market. Most private lenders want hefty fees up front and interest rates starting at 10% for higher risk loans. Since some ARM loans are already adjusting higher than that, a private lender could be a very decent option.
Non Profit Counseling Hotline: For borrowers in arrears or nearing a rate reset they know they cannot afford, try Hope Alliance's hotline. Hope Alliance is a non profit HUD sponsored counseling organization who will help you assess the parameters of your situation and discuss your options. After which, they will petition your existing lender on your behalf. The lender will then respond directly with you.
Call: Hope Alliance 800 449 9392 www.995hope.org
Their fee is paid by the lender if successful, so there is absolutely no cost to you.
BUT FIRST If you are not sure how to proceed, ask your lender directly about potentially working out or modifying your loan. You have a relationship with them so it's in their best interest to work with you!
Before you call, read about your options online at the HUD site.
http://portal.hud.gov/portal/page?_pageid=73,1827467&_dad=portal&_schema=PORTAL
Success to you! Loannetter
In recent weeks, we have seen so much rate volatility that it's hard to keep up! We find our underwriters nervously reviewing appraisals with an eye toward inflation and a downturn-- but in Washington State, things are much rosier. I get a lot of calls from California lenders wanting our loans!
Good News for Whatcom County: Fortunately property values in Whatcom County show a 4.6% increase in the last year. Realtors and appraisers I have spoken with consider this a 'normal' market. If you notice the accents in Starbucks these days--Bellingham is the 'place to invest'. If you bought a home in Washington in the 3rd Quarter of 2006 for $300,000 according to the OFFHEO that same house was worth $323,400 in the 4th Quarter of 2007. Check out their cool online calculator: http://www.ofheo.gov/calculator/Default.aspx
Where's the Beef? With all the news about 'rate cuts' consumers are befuddled as to why we brokers are not offering rock bottom Home Loan Interest Rates. The 'Fed cut in interest rates' is not helping consumers. These cuts are to the rates at which the Fed lends to Banks: assisting the banks and investors, like Fannie Mae and Freddie Mac for their losses on bad loans. While the Prime Rate has dropped 1.5% in recent months (the index for most credit cards) --have you seen your credit card rates going down? Private enterprise at work.
Buying or Refinancing? If you are in the market now, get your application into a good broker and work out your plan and timing. Mortgage Brokers fund 60% of home loans in the United States because we offer choice and personal accountability. Our esteemed competitors, the retail banks, really can't compete with the broad range of loans we offer. Bring your Bank's GFE into any good broker for a reality check and you could be very pleasantly surprised at what we can do!
Surprises: Your Interest Rate Lock may be subject to new Fannie Mae/Freddie Mac 'pricing adjustments'. Underwriters are exercising these new guidelines which came into effect just after Christmas '07. Which means your Rate could go up or you may have to pay points for certain risk factors including your FICO score or if you are borrowing more than 80% Loan to Value. Mortgage Insurance rates are mooted to rise next. So if you are borrowing more than 80% be prepared for that extra payment: the higher your 'risk factors' the higher the MI factor. MI is not the bogey man...it is tax deductible for most homeowners this year but-- like most tax breaks what the IRS giveth the IRS can taketh away!
The lesson here is to live within your means and save 20% for your down payment. What will they think of next?
Loannetter offers you the personal attention of an independent local Mortgage Planner. We take the time to get to know you and help you manage your real estate investments to suit your lifestyle.
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