05 Jan 09 Rates Drop and More Lenders Offer Mortgage Relief

Mortgage interest rates have dropped dramatically ever since the Federal Reserve unveiled a plan last month to buy up to $500 billion of mortgage securities backed by government-sponsored enterprises, Fannie Mae and Freddie Mac. The program also entails buying up to $100 billion of debt issued by Fannie Mae, Freddie Mac and the Federal Home Loan Banks. The Fed cutting rates benefits home refinancing and mortgage relief and foreclosure prevention alternatives.

Direct Mail Marketing Company, Kelly Media Group president, Jason Cardiff said in a statement yesterday, “Conversion rates for mail pieces targeting troubled homeowners with loan modification offers have received phenomenal double digit numbers.” Cardiff continued, “We have not seen mail to call ratios in the mortgage business since the 125 second mortgage boom in the late 90’s.” We are seeing positive results for mortgage brokers, law firms and loan modification companies. banks need to trust restored as well and the only motivating reason for consumers to start borrowing again will be low mortgage rates.”

Federal Reserve Leaves Interest Rates Unchanged

Fed Maintains Rate at Range of 0-0.25%.

Can borrowers with bad credit refinance into an affordable payment or will they lose their home to foreclosure? In a recent report, Freddie Mac chief economist Frank Nothaft said, “Interest rates for thirty-year home loans with fixed rates declined for the tenth straight week.” Mortgage rates dropped to 5% but how many distressed homeowner will actually qualify for a refinance loan with these 5% rates?

Former Ditech executive, Jeff Morris said, “Loan modifications give these rejected homeowners a new opportunity to negotiate a lower mortgage rate and in many cases the interest rate the lender agrees to is less or equal to the prime rate that mortgage lenders are offering “A” paper borrowers with 740+ fico’s with equity and full documentation.” Morris continued, “What it means in laymen terms I that struggling borrowers that can’t qualify for a refinance loan, still qualify for a loan workout that actually has a lower interest rate.”

Tags: bad credit refinance, direct mail marketing company, loan modification companies, loan workout, Mortgage interest rates

Filed in California Foreclosure News, Foreclosure Prevention Features, Mortgage News with 1 Comment

18 Dec 08 Streamlined Mortgage Modification Program Eligibility Requirements


  -- Conforming conventional and jumbo mortgage loans originated on or before January 1, 2008;

  -- Borrowers who are at least three or more payments past due and are not currently in bankruptcy;

  -- Only 1-unit, owner-occupied, primary residences; 

  -- Current mark-to-market loan-to-value ratio of 90 % or more.

Mortgage service companies will be sending mortgage modification solicitation letters beginning this month to thousands of homeowners believed to be eligible for this loan workout program. It is critical that eligible borrowers seeking mortgage relief respond to these letters and reach out to their servicers to determine if they can receive streamlined loan modification assistance. Also, borrowers who don't receive a letter are encouraged to contact their servicer to see if they may be eligible for SMP help. Fannie Mae will be working with servicers to monitor and improve implementation of the program as necessary. 

Fannie Mae exists to expand affordable housing and bring global capital to local communities in order to serve the U.S. housing market. Fannie Mae has a federal charter and operates in America's secondary mortgage market to enhance the liquidity of the mortgage loan market by providing funds to mortgage bankers and other lenders so that they may lend to home buyers. In 2008, we mark our 70th year of service to America's housing market. Our job is to help those who house America.  - Source Fannie Mae