Didn’t we go over this when obama sued over the loan criteria?

Say hello to 12% 30 yr fixed mortgage interest rates. Tell your rep – NO!

This bill is like sending a Nuclear Bomb into the Lending industry. I agree that primary residence mortgage rates will rise astronomically. Nothing like giving away homes to the least deserving.

I agree that this is a tough situation. However, take my case. I am a mortgage underwriter, who was laid off for 1 year. Couldn’t get another job – Not McDonald’s, not Fred Meyer, not anything. It literally drained 100% of my savings. In the meanwhile, due to all the mess in the industry, my house is now underwater by $70k. I have recently gone back to work, but not at full wages. I have no more savings to fall back on, and my husband has been out of work too. Now we are not people without means – but the events of the last year have totally drained us. So I can’t sell my house – I can’t come up with the balance. I can no longer afford the payments since I am not working at full wages and my husband is out of work (oh yes, he has gone to Mcdonald’s also). So our options are this: give the house back and have the bank encur all the foreclosure expenses which avg up to 18% per industry averages to sell the home, maintain the home, pay the insurance/taxes while for sale, court costs, attorney fees, etc. That adds another whopping $68k on top of the loss they are already encurring (remember – 6% sales commission is roughly $22k of that amount). So, now we (or rather they being the bank) are at a loss on this house of $138,000 roughly, and that is if they can sell it for what I THINK it would sell at. So if I can afford to stay in my house, that is the best solution for everyone – right? If the bank adjusts my outstanding balance to be at the range that the market value currently is, and I can afford it on my current earnings, they only lose the original $70k that the house is over valued plus the interest on that $70k. Since we have no intension of staying here past 5 years if possible, they come out a lot better. Sure, if we stayed in the house for the next 30 yrs they would lose money, and yes – some people would do that. Tough situation – you do every thing you think it right, and then the merket crashes like this. Who knows what the right answer is at this point. I just have to stay on my knees.

Seriously – I can write down my Yacht, 2nd home , my airplane, RV and ATV – but not my primary residence?

Add in the FACT that the ONLY stipulation that the BANKS are fighting HARD on is “They still have a claim in Bankruptcy court IF they violated consumer protection laws”… WHAT?

The tenacity of that fight alone and that “qualification” for endorsement by the banks SCREAMS for translation – “We have been violating all of these laws for a long time and until now it was not a big enough issue that we might actually get caught. SO If you are going to let people modify their mortgages – then We want yet another ‘get out of jail free card’ and still want to collect – no matter what consumer protection laws we are violating. Please forget that collectively, we have spent more money on bonuses and would lose more money in the foreclosure process then we would stand to lose by the modifying the mortgages in BK legislation.”

As a former WAMU and Bank One (upper echelon) employee – I can assure you that the argument of “They made the bed – let them sleep in it.” is much more appropriate to the lending institutions than those being foreclosed upon.

I’m tried reading the text of this and it made my head hurt. I’m sure most of the congress people won’t even try and just vote based on the pretty title.

I don’t see any need to mess around with the bankruptcy rules – If you were stupid and bought a house you couldn’t afford – then you lose. If you were stupid and lent money to someone who bought a house they couldn’t afford – then you lose.

If you take either of these groups off the hook for their stupidity, we’ll just be repeating the same thing down the road.

SO let me understand everyones comments here seem to be clear that all is well, except for one. Take a couple of steps back and look at the loans the bankers and brokers sold to these people. If the lenders did’t come up with the programs they did we wouldn’t be where we are. The lenders did nothing but secure alot of money by the TARP and interest and now they get the property and everything everyone went to work for. The banks are now under the microscope and they don’t like it. Well boo-hoo. They made there money thus far but we lost ours! And now there are millions being foreclosed upon, these people need to stand for what is right and fight the lender on foreclosure because in a statement above sounds like there are alot of laws being broken and if that is the case then I am sure there was alot of fraud done. FIGHT FOR YOUR RIGHTS. Quit blaming this all on the consumer if the brokers/bankers/investors/lenders didn’t allow the programs so they could bundle and sell them the writing is on the wall folks you just need to have some common sense to understand why we are here.

It has become apparent to me that most of the writers on this web are not facing the foreclosure/bk issue. Perhaps I was stupid (see my comments on 1/29/09), but back when we bought this house, we could more than afford it – to the point that we had saved a years’ worth of income after we bought this house (in 2002). AND we qualified on just one income… mine as a mortgage underwriter. My point here is that if we were dealing with just a small segment of the population, then I would agree that they need to learn their lessons – whether it ws their fault or just a bad case of circumstances. However, if the tide continues, the percent of foreclosures will continue, sending our economy further into the abyss. This you can thank on the crack heads who deregulated banking and didn’t keep their hands out of the lobbyist pockets while all this toxic paper was being written. Oh the stories I can tell you having been a mortgage underwriter in that time when we KNEW the dog walker making $5000/mo was a little hard to believe – but it all fell within “guidelines”. Please walk in my shoes before you try to judge – there are a LOT of us out here who did the right thing and are getting SCREWED. And the reason for the slight decline numbers in foreclsoure/bk last month? Because of the moratorium with FNMA/FHLMC and a lot of homeowners on the fence waiting to hear what this foreclosure bailout will be. I’m one of them. It isn’t getting better – it is just a lull in the storm. May God have mercy on us.

“Please walk in my shoes before you try to judge”

1) No thank you, I don’t like your shoes. And I will do my best to avoid ever facing bankruptcy or foreclosure.
2) I’m not judging you — I’m judging the merits of allowing you (and others like you) to abrogate the terms of your contract with your lender.

Mortgage rates are as low as they are (or have been in the past at least) because they are secured by the home. If this is changed, and the government alters the terms of these mortgages, the interest rates will by higher for everyone in the future. (Because there will be more risks for those offering the money to lend)

That being said – I certainly think your lender should voluntarily modify your loan – it is in their best interest as well as yours. (based on your previous comment) But I don’t think we should change the law to force them to do so.

Yes, one would assume that it would be better off for everyone if the lender was willing to talk. But they said that I had to be in default before we could even talk about anything. I realize that this is to keep all the deadbeats out there who don’t want to pay what they owe. Anyone willing to risk their credit must be in bad shape. I get that – it makes sense. Further more, if I were the only person, or one of the very few who historically must face this situation, then I gladly take my spaking and go somewhere else. But it truly troubles me about the fallout that could happen with further foreclosures and depreciating home values. There is a part of me that wonders which is worse – to face the enemy we know about, or the giant in the shadows. Not sure of the right answer, and certainly not an economist. Just really pissed off that this was allowed to get so far out of hand, and we are having to pay the price this way. I suppose it is our own fault, but we are way beyond the blame game and now is the time for some creative ideas. Got any? The good thing is that IF they pass this legislation, though I doubt that they will, is that it can get retracted if things get too much worse. What many people do not know is that Bush rolled out a FHA loan that was suppose to be the “savior of the world”. It encourged lenders to take a hit on mortgage loans and refinance the loans with a part of the principal forgiven. What to know how many of these types of loans have been done? Not one – zero. The lenders are still betting that it will not get as bad as dpeculation would say. Perhpas it will or won’t – the point is that lenders have so many commitments and so many ways they have sold someones loan that it is impossible to modify most of them and keep from getting sued by their investors. Tough situation. But if the BK reform does not get passed, I’ll bet my last dollar that no lender will willing jump on the bandwagon to take a hit when they have every hope that it is going to get better. It is the “stick” in the stimulus bill – without it – it is just a big hype. History repeats itself folks – just wait and see. If this does get passed, then maybe the BK situation will not worsen because the lenders are modifying things. You see, with the biggest unemployment number happening in the 4Q 2008, those folks will run out of the UI in 6 months – perhaps 9 months depending on their state and situation. That takes us to 3Q 2009, and if things are not turned around or a solution found soon, you will have an onslaught of foreclosures & bks from those folks who UI has ran out. Like I said, I’m not an economist – just a lowly mortgage underwriter, but this stuff seems to be pretty evident given the perfect storm that is facing us.

GREED…there’s so much of it to go around these days. Mortgage bankers, brokers, fund managers, and of course those stupid home owners…Right? And for the record…Anonymous of the January 28th 2009 post who called those fighting forclosure “the least deserving”…your an idiot! Thanks for the confirmation.

Look…real estate may go back up, but when…4 years, 5 years? Corporate planners I’m talking with don’t see this stablizing for a long time. And those who think I’m wrong…fine…my peers didn’t believe me when I said the DOW was headed for 7000 either…but they’re all now having a nice helping of crow, and wished they’d listened.

First, adjustable rate instruments should never be offered on primary residence first mortgages. Period. Also, the rates should be capped at 5% and qualification should be against PITI with mortgage insurance. In other words, these instruments should be one of the most dependable and stable out there. When you look at the stats, FICOs mean nothing with regard to a home mortgage on a primary residence. People will default on everything else before they’ll lose their home.

Second, if a person files a Chapt 7, there’s no recourse for the note holder except to take possession of the property, rehab it at their expense, and sell it for CURRENT MARKET VALUE (BIG LOSS!). No note holder is going to hang on until the property value rebounds…that’s just stupid.

IF the home owner actually has an income that will qualify at the lower rate and market adjusted principal, then they should be allowed the new note terms. And please, no windfall profit c**p…if not the current owner, then the next buyer will reap the gain, not the note holder. And besides, this MESS isn’t the fault of the homeowner alone. In a traffic accident, the person with the LAST CLEAR CHANCE to avoid the collision bears the lion-share of responsibility…therefore the lender is getting their just desserts for allowing these stupid loans in the first place…and that, my friends is who we should blame for our RETIREMENT ACCOUNT DISASTER. Investors, through greed, took chances with our money on risky instruments, that the government did not care enough to regulate. So I don’t fault the homeowner, I fault the the people who made the loans and should have known better.

HR 200 and S 61 should be supported, with modifications, to allow homeowners who got an adjustable rate mortgage within the last 4 years and whose principal amount conforms with the new temporary FHA limits to file for court modification, unless the note holder is willing to come to the table in fair and honest talks. Unfortuately, the way notes were packaged as investment instruments, lenders may not have the legal right to negotiate, except through a bankruptcy proceeding.

BUT WE HAVE A CONTRACT…is one of the reoccuring battlecrys….DANG…Renegiotiation of contracts is not sacreligious people. It’s not the 11th commandment. Some of my friends do it every single day for a living. It’s all about business, leverage, and profit. But given these times in which we live, we need to be pragmatic as well as prudent. It’s in everyone’s best interest at this time to see a reasonable amendment to the Chapter 13 code so that we don’t all end up in the bread line.

The HBA and MBA…the most staunch of opposition…don’t have a good arguement anymore, and the general public is fed up with greed. So the best strategy, if anyone is listening at this point, is to find a middle ground, such as a limited application of the bankruptcy code, as opposed to an unfettered use. Total opposition just paints those supporting it as complete greed freaks and they will suffer the rath of Congress and the Obama administration.

well said! i applaud you

I agree i went to my local police station to get a gun permit, they said they no longer do it there. I would have to drive some other place for finger prints, here is the kicker they had ink and finger print paper right in the very same room we were standing in. so i said hey we could save evryone some effort and i’ll do it my self with someone to witness i was doing it rightly at the same time, but no they insist i drive out some place have it done then drive back to them and pay 60.oo on top of it all.

Well folks…many of you got your wish. The reform bill is officially “on hold”…something I was expecting. Perhaps it is on hold because they want to see if the lenders will bite at the interest rate match, etc, etc…but here’s the issue – there is no stick now to “encourage” the lenders to refinance using this new program Obama put out. Same thing happened with the FHA loan issue I mentioned Feb 23 – it didn’t get any support because there was no teeth in it. History people – how can you repeat it and expect a different result? I beleive that is what some have called insanity. Well, here we are. Fasten your seatbelts – I hope I’m wrong. There is only 1 thing that needs to happen to drastically tip the scales at this point and send us to a point reached in the 1930’s. Perhaps the second coming of Christ will be the catalyst and then it just won’t matter what happens with all of this.

Anonymous of 2/28…keep the faith…the Dems are squabbling among themselves but I think most are willing to get onboard with some form of this legislation. MBA is taking heat from the voters via Congress and it’s votes, not just money that keeps you in office. Supporters of this and HR 200 must continue to call their personal representatives and demand support. Enough calls means the representative will listen. MBA are you LISTENING??? The voters have a dog in this fight and it’s our neighborhoods and our jobs.

I hope it passes. We need some relief.

call your senators.. and tell them they should vot e yes on s-611

Regardless of what has transpired. Our system of banking, which includes loans, refinances and whatnot are old and antiquated. They need to be revised.

Here is an example of a victim.
United Guaranty is a Property Mortgage Insurer; they are also a division of AIG. AIG is/was/has gone under because it has insured mortgages. UG (if not others of AIG, or the like) made payments to investors and banks alike. Then TARP was rolled out, which paid some Investors and Most Banks for their losses. Who is the victim?
JP Morgan, Chase, Wamu and EMC for example most likely recieved some TARP funds as well as Insurance Premiums for Property Mortgage Insurance. Again who is the Victim.

Ultimately we (you and I) must insist that if OUR government does not represent us fairly, (let alone represent us), then we need to replace them with someone who will. Ensure that your congressmen or congresswoman represents you farily and equitably.

You are clearly right. I am getting very tired, very quickly of always being the victim!!!

Please contact your Senators in support of S 61! NACBA has set up a toll free 877 number that can be used to reach Congressional offices DIRECTLY. Please help spread the word so that we can let Congress know of the wide-spread support for S 61! The number is: 1-877-354-4958.

I definitely will call that number you listed and encourage friends and family to do the same. My own personal situation is this bill will benefit my family not to mention my neighborhood. We tried to do the right thing and do a loan modification but our bank strung us along including a special forebearance period where we paid our payments with uniformed representatives not knowing how to do their job, calling you back and giving bad informationand now we have been told that our loan says it CANNOT BE MODIFIED. This is Wells Fargo and they blame the investor and the loan itself saying it cannot be modified. So there are those of out there who are trying to get right with the bank and trying to make it work and the banks or investors are not making this easy. This legislation needs to go through!

Acedebase —

We have had interest rates that high before and most people were able to refie 15 years later to get a lower one.

Kenj4018 —

Most people were taken advantage of. Like me. The bank took my deposit of 10% (40K) and walked away laughing. Now my house is 80% less than what I purchased it for and my monthly fee is 3 times the rental rates in the area. Why should I stay?

Tonyca2009 —

Thank you for being in agreement. In my particular issue, I was able to get into a fixed, still under subprime though and it will step up (adjust) to its regular rate in three years. At which point, I will not be able to afford it, again—back to square one.

I personally sent a letter to each senator and the president to emplore them to approve the senate bill 61.

E.

Also, see Senate Bill 895. This bill directly relates to the March 4th announcement of the rules put into place by the Obama administrations. If you all notice, HR3221 has been incorperated into the bill.
There had to be some mark on your credit report in order to attempt HR3221, that is why the banks did not want to participate in it. Now the banks have a bit back.
check it out.
We still have a chance, but it wont be without a fight.
We need to have this bill approved, or Senate bill 895 approved.

Erwi31,
The bill is S 896 which past yesterday 91-5, however, can’t seem to find any blogs with updated info. Many amendments which is not surprising, but it seems the Senate finally “heard and listened” to the pleas of the middle-class people. Let’s hope so anyway.

Unfortunately, the Senate “heard and listened” to the banking industry, why continues to lie with their own set of facts and numbers.

It was these “experts” (the banking cartels) that drew a vast majority into the “recession”, knowing full well what was to transpire. And that same Banking Cartel, or “experts”, continue to finance the congressmen and congresswomen.

Maybe our congressmen and congresswomen will understand that if they do not vote for the middle class people, let alone represent the people of their district, they WILL be voted out, despite what the “experts” reveal.

Senate Bill 895, or 61 must pass for those in the future to avoid another housing crisis, or banking crisis.

Eric.