Home Mortgage Loan Rates » Subprime Mortgage News

Second Mortgage Refinancing Difficult

Franklin Rhodes — Tue, 17 Nov 2009 06:32:29 +0000

Getting a second mortgage will be nearly impossible unless you have aton of equity and absolutely perfect credit. Cash out refinancing is available with FHA but not many homeowners are under 100% loan to value. Bad credit mortgage refinancing is very difficult to find outside of VA and hard money lending. There may be a chance our attorney can negotiate a reduced amount for your unsecured debts but they would have to be greater than $10,000 for most debt settlement programs.

The major benefit is a reduced balance which will free up your cash flow and increase the monthly savings. Also, you can have the debt paid quickly in less than eighteen months. The only concern with debt relief would be is that you have to jump through some hoops to qualify and may have a short term blip on your credit but it’s not a big deal if you pay the debt off quickly.

FHA Mortgage Loan Opportunities with Bad Credit Mortgages

Franklin Rhodes — Thu, 08 Oct 2009 14:44:20 +0000

With the demise of the subprime mortgage sector, where do borrowers get a bad credit mortgage or a home equity loan with bad credit? These days, most homeowners little home equity to take cash out, and many borrowers have been delinquent on their mortgage payment because of rising interest rates or from experiencing a hardship like loss of income or employment. Bad credit scores can be a serious problem when homeowners need to refinance their mortgage. Borrowers can apply for a FHA mortgage or they can seek a loan modification in hopes their lender will lower their payments and not foreclose on their home. Last week, FHA loan applications rose 14.4%, the highest level reported since the survey’s inception in 1990.

In other mortgage news, no money down home loans are still available in a few states with FHA mortgages in states that a judge ruled that borrowers should be allowed to use the government’s $8,000 tax credit as down payment assistance. In most states the only no money loans are VA home loans and you need to be a military veteran to qualify for those mortgages.

High Rate Mortgages for Option ARMs Slow Housing Recovery

Franklin Rhodes — Thu, 25 Jun 2009 21:30:29 +0000

Shirley Breitmaier’s mortgage payment started out at $98 when she refinanced her three-bedroom home in Galt, Calif., in 2007. The 73-year-old widow may see it jump to $3,500 a month in two years. Breitmaier took out a payment-option adjustable rate mortgage, a loan popular during the housing boom for its initially low minimum payments.

According to mortgage data firm First American Core Logic, about 1 million option ARM loans are scheduled to reset higher in the next four years. About 75% of those home loans will adjust either next year or in 2011, with the peak coming in August 2011, when about 54,000 mortgages recast.

In most cases, borrowers with Option ARM mortgages will be hit with unaffordable monthly payments are another threat to the housing recovery and the economy, said Susan Wachter, a professor of real estate finance at the University of Pennsylvania’s Wharton School. Owners may surrender properties to the bank rather than make higher payments for homes that have plummeted in value, she said. “The option ARM recasts will drive up the foreclosure supply, undermining the recovery in the housing market,” Wachter said. More than $750 billion of option ARMs or negative amortization mortgages were originated in the United States between 2004 and 2008.

Shirley Breitmaier chose the option ARM when refinancing her $315,000 previous home loan. Her payments began at 3/8 of 1%, or less than $100 a month, according to Cameron Pannabecker, a mortgage broker who is working with Breitmaier. The option ARM loan allowed her to forgo higher payments by adding the unpaid balance to the principal. She will be required to start paying principal and interest to amortize the debt when the loan reaches 145% of the original amount borrowed. Such terms aren’t typical for option ARMs, which were also known as “pay option” adjustable rate mortgages. The mortgage rates on many payment option ARMS are “typically very low in the first one to three months” and can be as little as 2%, according to Federal Reserve. Article was written by Brian Louis for Bloomberg.