Who Walks Out? New Studies Shed Light on Strategic Defaults
Who Walks Out? New Studies Shed Light on Strategic Defaults
DSNews
A nationwide rise in homeowners’ “negative equity” is convincing more people to walk out on their mortgages, even if they have favorable credit ratings and can afford to pay their loan, according to recent studies.
Two reports – one by researchers at Northwestern University and two other colleges, the other by the national credit bureau Experian and the consulting firm Oliver Wyman – are offering a clearer picture of “strategic defaultees” than has been previously available.
Kyl bill targets real-estate fraud
The Arizona Republic
New national legislation calls for setting up a $200 million fund to help states prosecute mortgage and real-estate fraud cases.
Sen. Jon Kyl, R-Ariz., is teaming with Sen. Charles Schumer, D-N.Y., to back the Fighting Real Estate Fraud Act of 2009, which would set up a grant program that local prosecutors, state attorneys general and Native American tribes could apply for to fund investigations.
Freddie Mac's house calls
The Denver Post
MCLEAN, Va. — Mortgage buyer Freddie Mac is going door to door to help delinquent borrowers avoid losing their homes.
The government-controlled agency hired Titanium Solutions to visit borrowers and encourage them to apply for loan modifications under the federal Making Home Affordable Program. The company will focus on borrowers who haven't returned letters or telephone calls about their late payments, Freddie Mac said Tuesday in a statement.
Lack of Equity Slows Federal Aid Program
The Washington Post
A federal program to allow borrowers with little or no equity in their homes to refinance is struggling to gain traction, according to government data released Tuesday, showing that only 93,070 borrowers have been helped since the effort was launched in April.
The program has encountered difficulties that government regulators had not expected, such as the limited capacity of lenders to carry it out and the large proportion of borrowers who could not initially qualify because their home values had fallen so sharply.
Rates Stay Low, But Applications Decrease in MBA Weekly Survey
MBANewsLink
Despite record-low interest rates, mortgage application activity fell by nearly 3 percent last week, the Mortgage Bankers Association said this morning in its Weekly Mortgage Applications Survey for the week ending September 25.
The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.94 percent from 4.97 percent, with points decreasing to 0.94 from 1.12 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The 30-year rate remains at its lowest point since May 22.