Barney Frank Up To No Good Still

Judicial Watch Ranked Barney Frank as the 3rd most corrupt politician of 2009:

3.Rep. Barney Frank (D-MA): Judicial Watch is investigating a $12 million TARP cash injection provided to the Boston-based OneUnited Bank at the urging of Massachusetts Rep. Barney Frank. As reported in the January 22, 2009, edition of the Wall Street Journal, the Treasury Department indicated it would only provide funds to healthy banks to jump-start lending. Not only was OneUnited Bank in massive financial turmoil, but it was also "under attack from its regulators for allegations of poor lending practices and executive-pay abuses, including owning a Porsche for its executives' use." Rep. Frank admitted he spoke to a "federal regulator," and Treasury granted the funds. (The bank continues to flounder despite Frank's intervention for federal dollars.) Moreover, Judicial Watch uncovered documents in 2009 that showed that members of Congress for years were aware that Fannie Mae and Freddie Mac were playing fast and loose with accounting issues, risk assessment issues and executive
compensation issues, even as liberals led by Rep. Frank continued to block attempts to rein in the two Government Sponsored Enterprises (GSEs). For example, during a hearing on September 10, 2003, before the House Committee on Financial Services considering a Bush administration proposal to further regulate Fannie and Freddie, Rep. Frank stated: "I want to begin by saying that I am glad to consider the legislation, but I do not think we are facing any kind of a crisis. That is, in my view, the two Government Sponsored Enterprises we are talking about here, Fannie Mae and Freddie Mac, are not in a crisis. We have recently had an accounting problem with Freddie Mac that has led to people being dismissed, as appears to be appropriate. I do not think at this point there is a problem with a threat to the Treasury." Frank received $42,350 in campaign contributions from Fannie Mae and Freddie Mac between 1989 and 2008. Frank also engaged in a relationship with a Fannie Mae Executive while
serving on the House Banking Committee, which has jurisdiction over Fannie Mae and Freddie Mac.

The FED's MBS Purchase Program Nearing End Of Funds Allocation

Fed MBS Program Update: 94% of Funding Used

Big Changes To FHA

NEW YORK (CNNMoney.com) -- It's going to be harder to get a government-backed mortgage from now on.

Looking to shore up its weakening finances, the Federal Housing Administration is set to announce stricter standards on Wednesday.

The agency, which insured nearly a third of new mortgages in 2009, will increase the premium it charges for its mortgage insurance and require those with weaker credit scores to come up with larger downpayments.

The FHA will also reduce the amount of money a seller can provide a homebuyer for closing costs, as well as tighten its enforcement of lenders.

"Striking the right balance between managing the FHA's risk, continuing to provide access to underserved communities, and supporting the nation's economic recovery is critically important," FHA Commissioner David Stevens said in a statement. "Importantly, FHA will remain the largest source of home purchase financing for underserved communities."

FHA loans have skyrocketed in popularity during the mortgage crisis since the agency backstops banks if borrowers stop paying. But housing experts are growing increasingly concerned about the agency's ability to handle rising numbers of defaults. (Cash cushion shrivels for FHA.)

In November, the agency reported that its reserve fund has dropped to .53% of its insurance guarantees, well below the 2% ratio mandated by Congress and the 3% ratio it had last fall. The fund covers losses on the mortgages the agency insures.

Federal housing officials, who took several steps to shore up the agency's finances last year, promised to do more. The new announcement is the latest set of changes to FHA policies.
What the new rules mean

The agency will increase its up-front mortgage insurance premium to 2.25%, from 1.75%. It will also ask Congress for the right to hike its ongoing premium, currently between .5% and .55% monthly.

The FHA will also require borrowers to have at least a credit score of 580 to qualify for the agency's 3.5% downpayment program. Those with lower scores will have to pay at least 10%. However, this rule may have little practical effect since Stevens recently said the average borrower score is 693.

The new policy also will reduce the amount of money sellers can provide to homebuyers at closing to 3%, down from 6%, of the home's price. That change will bring the agency in line with industry standards and remove the incentive to inflate appraisals.

Finally, officials plan to clamp down on lenders offering FHA mortgages. It will more closely monitor their performance and compliance with agency rules, as well as seek legislative authority to require mortgage firms to assume liability for all loans they originate and underwrite.

One thing the agency did not do is to broadly increase the downpayment requirement. Many industry observers said such a step is necessary to reduce the risk the FHA faces.
Agency plays crucial role

As banks have clamped down on mortgage lending, the FHA program has emerged as one of the few ways people can buy a home.

Banks are more willing to make FHA loans because they come with a federal guarantee to cover losses if the borrower defaults. And borrowers can more easily qualify for FHA loans because they only need 3.5% down and can have lower credit scores.

As a result, demand for FHA loans has exploded. The agency guaranteed more than $360 billion in single-family mortgages in fiscal 2009, which ended Sept. 30, more than four times the volume in 2007.

The agency insured about 30% of home purchases and 20% of refinanced mortgages in 2009. Nearly 50% of first-time homebuyers go through the agency.

The agency, however, has also seen a spike in delinquencies amid the mortgage meltdown. Some 14.36% of FHA loans were past due in the third quarter, according to the Mortgage Bankers Association. This compares to 9.64% of all loans

House Prices Still Up 25% Over Last Decade - Amazing!

Top Metro Areas by Mortgage Lending Volume, 2008

Top Metropolitan Areas by Lending Volume

Dollars in Thousands

1	Los Angeles-Long Beach-Glendale, CA	$88,630,823
2	Chicago-Naperville-Joliet, IL	$77,057,094
3	New York-Wayne-White Plains, NY-NJ	$70,930,690
4	Washington-Arlington-Alexandria, DC-VA-MD-WV	$53,638,942
5	Atlanta-Sandy Springs-Marietta, GA	$39,917,873
6	Seattle-Bellevue-Everett, WA	$38,110,276
7	Phoenix-Mesa-Scottsdale, AZ	$37,299,327
8	Riverside-San Bernardino-Ontario, CA	$34,543,195
9	Santa Ana-Anaheim-Irvine, CA	$33,078,199
10	Oakland-Fremont-Hayward, CA	$32,758,992

All Metropolitan Areas

Improving Economy Means Higher Rates

The U.S. economy lost 11,000 jobs in November which was a drastic improvement from the disaster of job losses in January. As the economy improves, investments will flow from fixed to equities- mortgages to stocks.There's a massive MBS sell-off in process. Rates lost three weeks of gains in one day.

• Job loss peaked in January 2009
• Job losses are continuing even as the economy is growing

The jobs report was much better-than-expected, proof that the U.S. economy is in recovery. Bad news for rate shoppers.

If the econonmy continues to show signs of improving, count on rates to increase rapidly.

 

New HUD/FHA Condo Guidelines

December 7 has been set as the date for the new condo review and approval requirements. For cases pulled on and after December 7 the condo project must either be currently approved on the approved condo list at https://entp.hud.gov/idapp/html/condlook.cfm or must be reviewed and approved before the case can close with FHA financing.

HUD offers two approval options: DELRAP and HRAP.

DELRAP stands for Direct Endorsement Lender Review Approval Process and HRAP stands for HUD Review Approval Process.  HUD agreed to allow experienced lenders the option of taking on responsibility for reviewing and approving some projects while choosing to submit others directly to HUD for their expertise on others.

1. The project must include no less than two units

2. All projects must be covered by hazard and liability insurance and applicable projects must provide evidence of coverage for flood insurance and fidelity bond insurance when required.

3. For projects whose master insurance policy does not include interior unit coverage, evidence of the borrower’s HO6 coverage must be obtained and provided.

4. Right of first refusal is now deemed acceptable as long as it does not subject any person to discrimination as listed or defined under the Fair Housing Act regulation 24 CFR part 100.

5. No greater than 25% of the total project’s floor space may be used for commercial purposes.

6. No more than 10% of the units can be owned by a single individual or investor.

7. No more than 15% of the unit owners are allowed to be delinquent on their HOA fees.

8. Evidence of a minimum 50% pre-sale must be presented in the form of any of the following: 

A direct builder certification requires the builder to sign and certify as to the following:

The undersigned hereby certifies that in lieu of providing (1) Copies of sales agreements and evidence that a mortgagee has issued approval; or (2) Evidence that units have closed and are occupied; the Developer/Builder has attached to the signed and dated certification, a list documenting all units sold, under contract or closed (i.e., and excel spreadsheet). This information will be used to document the required minimum presale requirement of 50 percent.

Title 18 U.S.C. 1014, provides in part that whoever knowingly and willfully makes or uses a document containing any false, fictitious, or fraudulent statement or entry, in any matter in the jurisdiction of any department or agency of the United States, shall be fined not more than $1,000,000 or imprisoned for not more than 30 years or both. In addition, violation of this or others may result in debarment and civil liability for damages suffered by the Department.

9. At least 50% of the units must be occupied by owners or sold to owners who intend to occupy.

10. Projects consisting of three or fewer units must not have more than one unit encumbered by FHA financing.

Projects consisting of four or more units must not have greater than 30% of the total number of units encumbered by FHA.

HUD will be tracking the number of cases assigned in each project and the FHA concentration will be listed within the condo approval data screens at https://entp.hud.gov/idapp/html/condlook.cfm.

11. The homeowners association budget must be reviewed for adequacy to ensure sufficient funds are available to maintain and preserve all amenities and features unique to the condominium project.

Government Moratorum Expiration Forces Jump In Illinois Foreclosures

Awaiting FHA's Audit Results

FHA Audit Due Wednesday Morning

11/04/2009 morning the Federal Housing Administration (FHA) will release their mortgage insider anticipated audit of its finances.

The details about how much capital is left in its single family insurance reserve fund which covers losses on its massive amount of covered homes is being awaited. FHA commissioner David Stevens has stated that the government entity and single family home loan insurer won't need tax payor money to weather the recession and housing crisis.

FHA's David Stevens told National Mortgage News last month that the stories of a mismanaged fund are essentially groundless. A spokesman for the agency said it does not anticipate releasing any results that will vary widely from "what we've already signaled."

Recently FHA has tightened its underwriting guidelines and taken administrative action against certain lenders that it believes were abusing and violating its guidelines.

Mortgage Refinancing, Loans, FHA, Mortgage Interest Rates, Mortgage Bankers Association, Mortgage Bankers, Wholesale Mortgage Lending, Mortgage Banking, Mortgage Market Guide, Housing Market, RealestateloanS.com, Housing, Fixed rate mortgage, Fannie Mae, Freddie Mac, HUD, FHA, National Association of Home Builders, Homeownership, Mortgage Professional

Appropriations Committee Keeping 2009 Home Loan Limits

Appropriations Committee Agrees to Extend Current Loan Limits 

Great news for would be home buyers !

October 28, 2009 Origination News

House and Senate appropriators have agreed to extend the current loan limits for Fannie Mae, Freddie Mac and Federal Housing Administration loans for another year as part of the continuing funding resolution Congress is expected to pass this week.

"The CR [continuing resolution] maintains the limits for FHA, GSE ... single-family mortgages at $729,750 through the end of calendar year 2010," according to a statement issued by the chairmen of the appropriations committees. The maximum $729,750 loan limit is due to expire Dec. 31 and it would drop down to $625,500 if it were not extended.

"This could result in major disruptions in the mortgage origination market for larger loan sizes as early as November," the appropriations chairmen said. Earlier in the week, industry trade groups warned Congress that quick action is needed because it is becoming more difficult for lenders to approve mortgages with balances above $625,500 due to uncertainty about an extension.

Realestateloans.com

HVCC Dying Soon

An amendment would sunset the scrutinized Home Valuation Code of Conduct (HVCC) obtained unanimous support from the House Financial Services Committee last week. The legislation was created by Rep. Gary Miller (R-CA), along with many calls on regulators to work together for more reasonable appraisal standards, while simultaneously elminating HVCC.

Loan originators would be able to order their own appraisals again instead of being abused by Appraisal Management Companies (AMCs). "I supportive of ensuring accurate appraisals, I have repeatedly expressed concern that the HVCC has potential to increase costs to consumers, significantly hinder a consumer’s ability to obtain legitimate and reliable appraisals, and adversely impact small business professionals who work in the very neighborhoods where these consumers are looking to purchase homes. In fact, since the implementation of the HVCC on May 1, there are numerous examples of higher costs for appraisals, poor service, the inability to use one appraisal for more than one lender, questionable quality of appraisals, and the inability to make corrections to inaccurate information on an appraisal report.” Congressman Miller stated.

Since the HVCC was implemented in May of 2009, appraisers have argued that it has cut salaries in half while destroying their hard earned relationships. Homeowners also complained in droves that appraisals are valued low, causing problems for those looking to refinance or sell their properties.

realestateloans.com, housing, mortgages, interest rates, homeownership, freddie mac, fannie mae, fha, hud

Home Buyer Tax Credit Needs Boost. Stop Dabbling and Knock This Downturn Out !

Home Buyer Tax Credit Needs Boost to Stimulate

October 9, 2009

Simply extending the $8,000 first-time homebuyer tax credit will not provide much stimulus for the economy, according an IHS Global Insight economist. "The first time buyers who were going to use it would have used it already," said Global Insight economist Patrick Newport. Congress has to "expand it in some way to have any impact," he said. The Obama administration and congressional Democrats are discussing ways to create more jobs and stimulate the economy and a homebuyer tax credit extension is in the mix. The first-time homebuyer tax credit is due to expire November 30 and the National Association of Home Builders and others are pushing for an extension that expands the tax credit to all home buyers. NAHB president and CEO Jerry Howard says it would kick start the move-up market, generate more sales and construction, and create 350,000 jobs. But it would cost the government $30 billion to $35 billion for a full year. "To get the most bang for the buck, it is has to be in effect throughout the spring and summer home buying season," Mr. Howard said.

Barney Frank, Go Away Please

Judicial Watch obtained the documents from the Federal Housing Finance Agency (FHFA) in response to a Freedom of Information Act (FOIA) request dated December 4, 2008. Judicial Watch requested records related to members of Congress activity regarding the policy of Fannie Mae and Freddie Mac to increase lending to individuals with poor credit risk, as well as correspondence and records about contacts between FHFA and Fannie and Freddie. Among the important documents:

FHFA letter, dated March 26, 2007, from the director of the Office of Housing Enterprise Oversight (OHFEO), James B. Lockhart, to U.S. Senators Elizabeth Dole, Chuck Hagel, Mel Martinez and John Sununu: “This is a very serious issue. Freddie Mac’s inadequate systems and controls make it a significant supervisory concern. Furthermore, its lack of timely public disclosures deny market participants the essential financial information made available by all other publicly traded companies so that investors may make informed judgments.” The letter also mentions, “…Fannie Mae still has not filed financial statements for 2005 and 2006 and thus, they are not timely filers either.”

FHFA letter, dated December 3, 2004, to Congressman Barney Frank: “On November 15, 2004 Fannie Mae filed a Form 12b-25 with the Securities and Exchange Commission (SEC). Fannie Mae indicated that its external auditors could not complete their reviews of its financial statements and noted the possibility of up to a $9 billion loss dating back to 2001. As a result, OHFEO has determined it will not provide a monthly capital classification at this time.”

Letter dated June 16, 2006, from OHFEO Director Lockhart to Senator Chuck Hagel: “…In January 1999, Chairman and CEO Franklin Raines approved a recommendation made by the Chief Financial Officer (CFO) (Tom Howard) and the Controller (Leanne Spencer) to defer recognition of $200 million in amortization expense. This deferral, along with other accounting decisions made at that time relating to provisions for loan losses and the recognition of low-income housing tax credits, allowed management to meet the EPS threshold for maximum bonuses.”
Overall, these documents show that Congress was made aware of the massive problems at Fannie Mae and Freddie Mac over the last six years. Yet liberals, led by Congressman Barney Frank, repeatedly blocked attempts to rein in Fannie Mae and Freddie Mac.

For example, during a hearing on September 10, 2003, before the House Committee on Financial Services considering a Bush administration proposal to further regulate Fannie and Freddie, Rep. Frank stated: “I want to begin by saying that I am glad to consider the legislation, but I do not think we are facing any kind of a crisis. That is, in my view, the two government sponsored enterprises we are talking about here, Fannie Mae and Freddie Mac, are not in a crisis. We have recently had an accounting problem with Freddie Mac that has led to people being dismissed, as appears to be appropriate. I do not think at this point there is a problem with a threat to the Treasury.“ 

http://michellemalkin.com/2009/04/07/barney-frank-protests-and-sputters-and-bullies-too-much/

GPS Chips For Suspected Terrorists

$15,000 Tax Credit Must Be Applied To All Homebuyers

A poll recently released by real estate information company Zillow indicates that 1 in 5 prospective first-time buyers said extending the $8,000 credit through 2010 would be the “primary influence on their decision to buy.”

Another 1 in 4 of respondents said a possible extension would have a “significant influence” on their home buying decision. Zillow did the numbers and thinks an extension from December 30, 2009 to November 30, 2010 would result in an additional 334,000 home buyers.

Zillow economists cautioned that the homebuyer tax credit may not be the most efficient means of boosting flagging home sales.

“There’s little doubt that the tax credit will boost demand at the margin, and that fact will make it easier to work down our current high inventory levels of existing homes on the market, said Zillow Chief Economist Stan Humphries.That said, the cost of bringing these additional homebuyers into the market is substantial. Assuming 1.86 million first-time buyers take advantage of the full credit once extended, this translates into an additional $14.86 billion in government spending. For every five homebuyers who receive the credit, four would have bought their home even without the credit.”

The first-time homebuyer tax credit is due to expire on November 30, 2009