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Paul Luykx

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Current loan modification challenges

06-20-09
Paul Luykx
Some modifications are arranged very quickly, and it seems others take forever.
At the end of the day lenders dictate the process. I regret to advise that in many cases lenders are very disorganized resulting in significant delays - often requiring (multiple) new submissions with fresh information. Below are a few articles that illustrate the state of affairs. It's a mess frankly. Please do be assured that we remain focused on getting the best possible modifications for our clients. As of today we have a 100% success rate, and we have not lost a single property to foreclosure! - Paul
"Mortgage modifications remain elusive even with a federal program intended to help..."
More than two months after the Obama Administration launched a plan to streamline mortgage modifications, those striving to save their homes from foreclosure remain frustrated over financially crippling delays. Read more.

"For some homeowners, promised help is elusive..."
More than three months after the Obama administration outlined a new program aimed at rescuing millions of distressed homeowners by compensating banks that modify mortgages, Ms. Ulery’s experience illustrates the mixture of confusion, frustration and limited assistance that now reigns. Read more .
"The failure of the mortgage modification system threatens housing"
The theory was simple and elegant. By offering homeowners who could not afford their monthly mortgage costs lower monthly payments, people could be able to stay in their homes. That would lower the US default and foreclosure rate, in turn building a foundation under the housing market. Read more
"Foreclosures grind on as lenders fail to modify loans"
The Obama administration's $75 billion program to reduce foreclosures has been beset by backlogs and delays, leading many overstretched homeowners to complain about unreturned phone calls and inaccurate information from lenders, while others say they were denied help for reasons that weren't clear. Read more.

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2 stage loan mods - Pace of loan mods picking up - Bankruptcy can end 2nd mtg woes

05-24-09
Paul Luykx

Loan modification update
The pace of loan modification close-outs is picking up (finally). It is ultimately the lender that drives the timeline and some cases have taken forever. Mhy second observation is that increasingly I see a two-stage approch where the lender wants to see evidence of ability and willingness to make (typically three) payments first before commiting to a modification. - Paul
Treasury's offer for loan modifications and short sales (Update)
The U.S. Treasury, seeking to strengthen government anti-foreclosure programs, will provide new incentives for lenders to modify mortgages where home-price declines are most severe or to pursue short sales. Read more.

Bankruptcy may end second mortgage woes
Chapter 13 may also help you eliminate the payments on your second or third mortgage. That's because if your first mortgage is secured by the entire value of your home, which is possible if the home has dropped in value, you may no longer have any equity with which to secure the later mortgages. Read more.

Slow start to U.S. plan for modifying mortgages
The Obama administration's plan to help millions of troubled homeowners avoid foreclosure by reducing the size of their mortgage payments is just getting off the ground. Read more.

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1% 2nd mtg plan - Slow going - Lenders chase short sellers

05-10-09
Paul Luykx
1% second-mortgage rates via modification plan
The Obama administration is trying yet another program to stem home foreclosures -- this time by offering lenders incentives to cut payments on second mortgages. The taxpayer-funded plan aims to slash second-mortgage interest rates to as low as 1% for the next five years for qualifying borrowers. Read more
 
Lenders chase short sellers 
An increasing number of lenders are going after borrowers who sell their homes for less than they owe – known as a short sale – in order to recover more of the difference between the amount owed and the sale price. Read more. (We make sure that any short sale includes a full release - P)

Homeowners find loan modifications slow going
NPR - Morning Edition, May 7, 2009 · The Obama administration has begun doling out the first chunk of $75 billion to several banks nationwide to help struggling homeowners stay in their homes. The funds are part of a new program called Making Home Affordable. The administration expects lenders to use the money to offset the cost of modifying millions of home loans. But some lenders are moving slowly. Listen here (4 minutes). (This segment deals with owner-occupied property only - P)
 
Why we go even slower...
First, our pace is determined by the lenders - which is sloooow. But we never "drop the ball" and remain focused to getting it done asap. We position a loan mod request for best results by taking the time to "build the case". We also take the time to negotiate for best results, and lastly our attorneys review the paperwork to make sure that we have indeed created a "new financial beginning" - we don't just accept ANY solution or one that will come to haunt our clients later.
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Condo financing - Stated loans - 680 Fico reqd for PMI

05-10-09
Paul Luykx

Condo financing continues to be a real problem. It is critical that projects be properly positioned and rolled out to ensure availability of buyer financing. I recommend you make sure you pre-qualify any listing/purchase of a condo right away to make sure buyer financing is available! See presentation. /// Rates are trending up. Current recommendation: Lock. - Paul

Minimum Fico and PMI
Lenders are tightening up. The minimum Fico for FHA is now 620. FHA also increased insurance premiums, minimum down payment requirement, and the pricing is now higher as well. It is still better than Fannie/Freddie though. Now a word about PMI. Most PMI companies will no longer insure loans originated by mortgage brokers. (Prospect is a direct lender, so no problems here). Second thing to know is that minimum Fico for PMI is now 680! Early prequals and 75-day credit make-overs to increase credit scores now more important than ever!
 
Lenders chase short sale sellers
An increasing number of lenders are going after borrowers who sell their homes for less than they owe – known as a short sale – in order to recover more of the difference between the amount owed and the sale price. Read more  (For loan mod and short sale service go here - P)
  
Stated income loans
Just a reminder that stated income loans are back. Up to 80%LTV. Higher Fico required. Investment and owner occupied properties.
 
Rates up on positive economic news
For the week ending May 7th the 30-year fixed averaged 4.74% with an average 0.7% fee, up from last week when it averaged 4.78%. This time last year it averaged 6.05%. Freddie Mac rate surveys.
 
The top 10 US towns for living well 
Forbes magazine and ZoomProspector.com identified the best small cities in the United States based on factors such as natural beauty and average income. Read more

 

 
Contact me for further information or assistance. 
 
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"Winning is not everything, but wanting to win is"
Vince Lombardi (1913-1970)
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Where's my loan mod? - A program for 2nds? - Lenders adopting Obama program

04-26-09
Paul Luykx
The Treasury Department said it has signed contracts with six major mortgage lenders to participate in the Obama administration's $75 billion foreclosure prevention effort. Read more
Where's my loan mod?
I have received quite a few concerned calls pertaining to the length of our procedure recently. I wanted to let you know that we are still diligently processing all loan modifications with 110% effort, and success! As a result of the recent release of President Obama’s Stimulus Plan, lenders have begun "dragging their feet" while they determine to what extent they will be able to tap into those funds. This has caused a slowdown on their part in communication with us. To my current clients: "Please be patient. In most cases time is on your side. The terms of modifications are getting better all the time"
Treasury weights new mortgage subsidies: sources
Fannie Mae and Freddie Mac, the mortgage finance companies, would administer the new program to resolve problems with second-liens. Read more. (We secure loan mods on 2nds all the time. A formal program may set a standard, resulting in more predictability and faster approvals. - P)

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"All the problems of the world could be settled easily
if men were only willing to think."
Thomas J. Watson, Former President of IBM (1874-1956)
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