Banks that are involved in the Home Affordable Mortgage Program admitted that they have been slow to turn temporarily reduced mortgage payments into permanent ones and Obama administration officials admit that the $75-billion program, which offers banks cash incentives to reduce payments, has had troubles, and they said they are thinking of revisions to make it more effective. The biggest blows will be felt in California, Florida, Nevada and other states where home prices have dropped the most and the ranks of struggling homeowners have increase.

Officials noted that not all homeowners are qualified since the program is merely for owner-occupied homes, and excludes a diversity of mortgages, as well as jumbo loans. The administration keeps on making modifications, including a requirement added last month entailing the homeowners to document their income before a trial modification is approved. Regardless of this matter, the program continues to draw criticism. Banks have object that they’ve had trouble getting homeowners to give the required documents, upset homeowners have complained of bureaucratic runarounds from their servicers, federal watchdog agencies also have criticized the program, and last month the chairman of the House Oversight and Government Reform Committee announced an investigation.

As soon as the lender gets hold of a foreclosure deficiency judgment against you, they can immediately act to implement the judgment. This will be implemented by garnishing your work, halt your bank accounts or worst, they can take away your other personal property. However, you have few options when it comes to mortgage deficiency if the lender is authorized to obtain a foreclosure deficiency judgment. First option would be bankruptcy. You can opt to file for bankruptcy protection to protect yourself and your property. On the contrary, it usually requires an attorney who may cost you a lot compare to the restitution for your debt. Moreover, your credit is damaged for an additional three years because a foreclosure only remains on your credit history for seven years but a bankruptcy will last for ten years. For you to avoid this kind of dilemma, you have to take care of the problem before it becomes worst.

Talking about dealing with a mortgage deficiency through a foreclosure or a short sale, you must discuss with the lender the amount of foreclosure deficiency judgment. You can choose to use a firm that is experienced in dealing with foreclosure deficiency judgment and negotiation processes for you to obtain a better settlement rather than attempting to do this on your own. You must never ignore a foreclosure deficiency judgment because before you know it, you will be facing a bigger problem. The finest way to deal with this problem is to be proactive. Get help from an experienced firm that will be able to negotiate on your behalf and obtain the best settlement possible and go on with your life happily without having to continue to pay for the debt for years to come.

Based on the mortgage giant’s weekly survey, lenders offer a rate of 20% down payment for borrowers with good credit and the upfront fees averaged 0.7% of the loan amount. The average fee offered on a 15-year fixed-rate mortgage was 4.32%, which is well-known as a refinance loan for borrowers wanting to pay off their mortgages faster. That was down from 4.33% a week earlier, with 0.7% paid to the originator.

The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 4.05% this week with 0.6% of the loan balance paid to the lender. It has a fixed rate for five years before becoming variable. That was down from 4.11% last week, Freddie Mac said.

Borrowers frequently can find slightly lower rates by shopping around according to home-lending professionals.

The Obama administration has not yet issued its recommendations and they’re not expected until next year. The Center for American Progress plans to issue its report on the future of housing finance this fall.

You can be pretty sure there will be a bit of a frenzy over what to do about the housing finance market as the government gets closer to making a decision. In today’s marketplace, three key players — the FHA, Fannie and Freddie — buy 90 percent of new mortgage loans. The private mortgage marketplace has dried up. The U.S. government has propped up Fannie and Freddie with capital infusions totaling $96 billion plus almost ten times that amount through purchases of debt and mortgage-backed securities by the Treasury and Federal Reserve.

MBA wants to avoid any similar federal bailout in the future. It proposes that the new companies pay fees into a federal insurance fund that would guarantee interest and principal payments to bondholders if companies were unable to make them. This would replace the current system of assumed federal backing. Investors have lost confidence in the assumed federal backing and reduced their holdings of Fannie and Freddie debt.

MBA also wants the new smaller private companies to focus solely on the mission of mortgage creation, but not be allowed to hold large amounts of mortgages and securities, as Fannie and Freddie do now. Instead, the MBA calls for government agencies rather than the new companies to assume the mission of promoting affordable housing that Congress assigned to Fannie and Freddie.

Republicans want to end government conservatorship within 18 months, but Democrats haven’t spelled out a time line for this process. They likely won’t take a public stance until they get some word from the Obama administration, which won’t be until next year.

In a related story, FBR Capital said Freddie and Fannie have no “underlying value” to justify the recent tripling in their share prices this month. Since their big jumps, both dropped by about 50 cents per share from Aug. 28 to the close of market on Sept. 1. On Aug. 28 Fannie closed at $2.04, but dropped to $1.59 at the close on Sept. 1. Freddie was at $2.40 on Aug. 28 and dropped to $1.90 at close on Sept. 1.

Lita Epstein has written more than 25 books, including Trading for Dummies.

Yes they say the average transaction take 150 calls. Yes thats right between home inspections pest reports, title companies and agents the average transaction takes 150 calls. Now add the bank calls which in our office is two or three times a week. It is disappointing to get our pay checks cut. Though here in our office its about taking care of our clients and in the end we get taken care.. Lots of Referrals!! Keep taking good care of the client.

Seems unfair to cut the commission of hard working short sale agents… but things are starting to change!

On February 24th, Fannie Mae in Servicing Guide Announcement 09-03 [Here is the PDF] said the following:

No Negotiation of Preforeclosure Sales Commission

Effective March 1, 2009, closing of preforeclosure sales may not be conditioned upon a reduction of the total commission to be paid to real estate agents to a level below what was negotiated by the listing agent with the borrower, unless the fee exceeds 6 percent of the sales price of the property in aggregate. Servicers are reminded that they must continue to obtain any approvals that may be required by interested third parties in connection with preforeclosure sales.

No more reduced commissions on Fannie Mae loans, yeah! I like how Bill Gassett’s take on it on Massachusetts Real Estate Voice:

Fannie Mae has recognized that negotiating commissions for short sales is unfair because of the extensive work required in many occasions that occur over many months and working with numerous buyers. Paying real estate agents fairly benefits Fannie Mae because Realtors play a crucial role in short sales. The fact that many banks would turn around after a foreclosure and offer commissions much higher did not make much sense.

Well, we’re all glad the industry is finally starting to realize the importance of rewarding hard-working short sale “angels” who are helping everybody, including the banks, to cut their losses!

Lets hope other banks and servicers follow suit.

The 5 Mistakes Are:

1. Stop Paying Without a Plan — depending on the bank you can actually start a loan workout / modification or a short sale without stopping your payments! Other times you may need to stop paying to get their attention (or because you simply don’t have money!) Angel will never tell you to stop making your payments without making sure you understand the consequences.

I think this turned out to be a pretty nice first video with some valuable tips… what do you think?