Posted on: 13th Feb, 2008 09:21 am
What do they mean when they are talking about the mortgage mess ? Why are they talking about all the mortgage foreclosures and stuff?
ummmm...patricia...havent you noticed that there are a lot of mortgage companies going belly up...a lot of homes being foreclosed...a lot of scurrying around in congress and the white house to look like saviors...a lot of posts on here that describe people in very serious financial trouble?
maybe your neighborhood is flourishing - i am happy for you if that is the case. but there are millions of people in this country who have been suffering with the inability to pay their mortgages for quite some time now - that's what all the fuss is about.
maybe your neighborhood is flourishing - i am happy for you if that is the case. but there are millions of people in this country who have been suffering with the inability to pay their mortgages for quite some time now - that's what all the fuss is about.
Yes George. You are absolutely right. There are millions of people in all over the States Who are feeling the heat of the present credit crunch and facing great problems in paying their mortgage. They are trying out mortgage modifications, short sale, DIL and if nothing works out, the only way that reams for them is either filing BK or going for foreclosure – in both case they experiences a huge set back at their credit
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Actually no I haven't. Don't see that where I live yet.People are still building and buying homes as far as I can see. I try not to watch to much news as it is depressing. :oops: Why are the people being foreclosed ?Are they loosing their jobs ?I know they cost of gas is more than we can afford. We spend I know over 100 in gas a week for 2 vehicles.
I heard on the news here that people are going out and buying new homes because of the lower interest rates. We are building a home now to sell as my hubby is a construction person who works on his own.The real estate lady says the markety for new homes is thriving ,thats why I am wondering about all that.
wow...must be a nice spot to live in - unaffected by the turmoil around you. i agree with you on the news, but not because of it being depressing for me. i simply don't like how they portray everything - "breaking news" and all - trying to make us feel like the world is coming to an end because somebody ran a red light or something. i let my wife watch the news - i read the newspapers instead - by then it is a few minutes later, and those who are writing can be calmer about what has happened.
at any rate, the primary reason for the "mortgage crisis" as it is called, is the interest rates that people with poor credit were getting when they bought their homes. many of them shouldn't have been able to purchase anyway, as they couldn't afford the houses anyway. now that the rates (mostly adjustable) have changed for the worse, they simply cannot make payments and banks and mortgage companies are foreclosing and dropping like flies all over the country (except your neighborhood of course).
i think i read once you live in kentucky - is that right? i know that tennessee is having all sorts of troubles, too; and that is right next door to ky. so i guess you want to put up a border or something to keep that situation out. LOL
at any rate, that's pretty much what's been happening around the country - nice to know that you're not really affected.
at any rate, the primary reason for the "mortgage crisis" as it is called, is the interest rates that people with poor credit were getting when they bought their homes. many of them shouldn't have been able to purchase anyway, as they couldn't afford the houses anyway. now that the rates (mostly adjustable) have changed for the worse, they simply cannot make payments and banks and mortgage companies are foreclosing and dropping like flies all over the country (except your neighborhood of course).
i think i read once you live in kentucky - is that right? i know that tennessee is having all sorts of troubles, too; and that is right next door to ky. so i guess you want to put up a border or something to keep that situation out. LOL
at any rate, that's pretty much what's been happening around the country - nice to know that you're not really affected.
Quite true george. People with poor credit went for loans which they couldn't afford and then there were foreclosures and what we call the mortgage mess - i suppose it's the situation involving borrowers missing payments or making late payments and then going into foreclosures...all these stuff is what mortgage mess is all about.
Let's hope for the best to come. Just a few days ago the government approved the Economic Stimulus bill offering tax rebates. i hope this eases the situation a bit giving money to consumers to spend upon or pay off their debt. george what are your thoughts on this Bill?
Thanks
Let's hope for the best to come. Just a few days ago the government approved the Economic Stimulus bill offering tax rebates. i hope this eases the situation a bit giving money to consumers to spend upon or pay off their debt. george what are your thoughts on this Bill?
Thanks
Well by the time it gets here it will be too late (summer,they said) they will already have lost their homes.We bought our home 11 years ago with my father in-law as a co signer.Because of some bad things where we lived it hurt our credit.Also we could only get a revolving rate like you were talking about. Everything seems to point in out direction that we should be failing also. I will be the first to admit that our mortgage payment is very high for our income,but so far always managed to pay it. I hope with God's help we will continue on with that.I have tried to talk to y hubby about refinancing and maybe getting a fixed lower rate but he doesn't seem to think that is possible.He says our bank does not offer that.Sounds strange to me ,maybe he is worried that with our credit rating we will not qualify for a fixed lower rate.I don't know.Doesn't seem that the other part of the world is suffering from any more than we are .We simply have continued holding our own is all.In 11 years we have only failed to make one payment before 30 days were up. Our co signer has died 2 years ago so we are on our own on the loan now.Our electric and mortgage payment together is close to 1,000 a month.
i think rebates are a smokescreen and a failed attempt (at least they made an attempt) to eliminate or provide a solution to the existing problems. i am aware that it was suggested we take our $600 and go shopping in lieu of paying bills, which is, of course, ludicrous.
what we are seeing is a lot of "too little, too late" to make any inroads in the issues that many people are facing. i understand that there is serious bureaucracy involved in making changes, and i salute those who are trying to make these changes, but much of what has already transpired and much of what is on the docket is inadequate to provide the assistance where needed. and that's not even including the devastation still haunting those who live in the mississippi delta!
one of the items i noted this week is that a handful of lenders are holding their foreclosure actions in abeyance for a 30-day period. for those who are 3-6 months behind, this is merely a holding pattern. if someone is 3 or more months delinquent now, the likelihood that an additional 30 day period will provide solutions is pretty doggone slim. here again, the intent to help is there, but the method isnt viable.
color me a skeptic - the fha program has already proven that it will not accommodate a large percentage of the delinquent/troubled/facing foreclosure population. we have a program in connecticut that mirrors the fha program, and it is most difficult for people to qualify for.
i recognize that large numbers of people who had no business getting mortgages were getting mortgages and that this represents a large percentage of those in trouble now.
i remember when alt-a came out (aimed at creditworthy people); then it got expanded to incorporate those who were not so creditworthy. the first incarnation of the ninane loans were for those with 620 scores! can you imagine, a 620 (poor-to-mediocre) score and you didnt have to disclose assets, employment or income?! what a ridiculous tool the mortgage market created to take care of itself. what's it all about? greed. did people know they had no business taking these loans? of course, they did; but they also had loan officers all over the place falling all over themselves trying to convince them that they could afford it after all.
it usually doesnt take much work to convince someone who lacks expertise that a loan officer can work miracles on their behalf. and we all know that this is what happened to far too many people in far too many situations.
what we are seeing is a lot of "too little, too late" to make any inroads in the issues that many people are facing. i understand that there is serious bureaucracy involved in making changes, and i salute those who are trying to make these changes, but much of what has already transpired and much of what is on the docket is inadequate to provide the assistance where needed. and that's not even including the devastation still haunting those who live in the mississippi delta!
one of the items i noted this week is that a handful of lenders are holding their foreclosure actions in abeyance for a 30-day period. for those who are 3-6 months behind, this is merely a holding pattern. if someone is 3 or more months delinquent now, the likelihood that an additional 30 day period will provide solutions is pretty doggone slim. here again, the intent to help is there, but the method isnt viable.
color me a skeptic - the fha program has already proven that it will not accommodate a large percentage of the delinquent/troubled/facing foreclosure population. we have a program in connecticut that mirrors the fha program, and it is most difficult for people to qualify for.
i recognize that large numbers of people who had no business getting mortgages were getting mortgages and that this represents a large percentage of those in trouble now.
i remember when alt-a came out (aimed at creditworthy people); then it got expanded to incorporate those who were not so creditworthy. the first incarnation of the ninane loans were for those with 620 scores! can you imagine, a 620 (poor-to-mediocre) score and you didnt have to disclose assets, employment or income?! what a ridiculous tool the mortgage market created to take care of itself. what's it all about? greed. did people know they had no business taking these loans? of course, they did; but they also had loan officers all over the place falling all over themselves trying to convince them that they could afford it after all.
it usually doesnt take much work to convince someone who lacks expertise that a loan officer can work miracles on their behalf. and we all know that this is what happened to far too many people in far too many situations.
okay...that previous post was my diatribe about the current situation - i still think the sky is not falling, despite all the chicken littles out there (i even have some in my office!).
now....patricia...you might just have to twist your husband's arm when it comes to refinancing. you said you have an adjustable rate loan (did not state the rate), and i am hoping that the current rate isn't onerous. also, i hope you two took the time to review the adjustable and ensure that it isn't one that will fly much higher in the near future.
based on your post, it seems that your loan was taken long enough ago that rates were more favorable, as were those products; and that your next change in rate won't do a real number on you.
as for "your bank" not offering the right product for you to refinance; i know you know, from wandering around these forums all this time, that there are far more alternatives than just that one bank.
rates have increased of late - the last week or two has seen almost daily changes upward - but that doesn't mean that you might not benefit from moving ahead with a refinance to a fixed rate loan now. if you can save yourself some money - and of course, you could do so by extending the loan term to reduce the payment amount - it would be beneficial.
from the tone of your post, it seems that the payments you are making at this point are higher than what you would like to afford. i agree with you that it is a good time and a good idea to investigate a refinance to see how you might best rearrange your finances.
please keep us posted. :)
now....patricia...you might just have to twist your husband's arm when it comes to refinancing. you said you have an adjustable rate loan (did not state the rate), and i am hoping that the current rate isn't onerous. also, i hope you two took the time to review the adjustable and ensure that it isn't one that will fly much higher in the near future.
based on your post, it seems that your loan was taken long enough ago that rates were more favorable, as were those products; and that your next change in rate won't do a real number on you.
as for "your bank" not offering the right product for you to refinance; i know you know, from wandering around these forums all this time, that there are far more alternatives than just that one bank.
rates have increased of late - the last week or two has seen almost daily changes upward - but that doesn't mean that you might not benefit from moving ahead with a refinance to a fixed rate loan now. if you can save yourself some money - and of course, you could do so by extending the loan term to reduce the payment amount - it would be beneficial.
from the tone of your post, it seems that the payments you are making at this point are higher than what you would like to afford. i agree with you that it is a good time and a good idea to investigate a refinance to see how you might best rearrange your finances.
please keep us posted. :)
The rate is 7.5 it was supposd to be set where it can go no higher than a certain % .Without lookig I cannot say what that rate is .I think I can remember my hubby talking to the bank about that very thing as It appeared to have gone above that rate. I have not read our mortgage as I don't understand a lot of the talk.I think my hubby is afraid our credit will not allow us a better rate in refinancing.
honestly, patricia, you need to get a good look at your mortgage note to decipher the terms. a rate of 7.5 isnt awful, but you may very well be able to do better.
i understand the thought about credit - do you have any idea what your scores are? honestly, the only way to know if you do or don't qualify is to take that step and find out.
i understand the thought about credit - do you have any idea what your scores are? honestly, the only way to know if you do or don't qualify is to take that step and find out.
Yes,you are right.The rate of 7.5 is not bad only now that the rate is lower it is not as good. I think my score in in the 600's somewhere it was in the 700's till hubby got my card.I don't know what his score is.
i would say you're probably in good shape for a refinance. as you may have noticed, we keep saying that fha loans meet almost everyone's needs. i'm sure it would meet yours, as well.
oh yeah...don't share your cards! :D
oh yeah...don't share your cards! :D
What is good about FHA loans and how do you qualify?
interest rates for fha loans and conforming loans (those sold to fannie mae and freddie mac) are pretty much the same these days. however, because those other 2 agencies have changed their requirements to take credit scores into consideration, the pricing on these loans (points, fees, etc.) have become more prohibitive.
for example, if your credit score was 660 (not so bad a score, really) and you wanted to buy a home for $250000 and borrow $200000 (20% down), you might get an fha rate of 6% with 2 points. a comparable scenario using a conforming loan (fnma) would be 6% with at least 3 points (and that's not adding in a penalty for the score).
any borrower with a score of 585 or higher can qualify for an fha loan that will be better priced than a conforming loan. as soon as your score dips below 680, you are penalized by fnma/fhlmc.
boy, i know this had some odd phrasing here, but i hope it made some sense. each loan is going to be structured a little differently, and there are plenty of other variables that come into consideration.
i hope this was helpful, though, patricia.
for example, if your credit score was 660 (not so bad a score, really) and you wanted to buy a home for $250000 and borrow $200000 (20% down), you might get an fha rate of 6% with 2 points. a comparable scenario using a conforming loan (fnma) would be 6% with at least 3 points (and that's not adding in a penalty for the score).
any borrower with a score of 585 or higher can qualify for an fha loan that will be better priced than a conforming loan. as soon as your score dips below 680, you are penalized by fnma/fhlmc.
boy, i know this had some odd phrasing here, but i hope it made some sense. each loan is going to be structured a little differently, and there are plenty of other variables that come into consideration.
i hope this was helpful, though, patricia.