In The News
Kicked when you're down
How to protect yourself from mortgage-modification fraud
By Lew Sichelman
May 14, 2009
WASHINGTON (MarketWatch) -- Question: Based on things I have been reading, I am getting an uncomfortable feeling regarding the company I am presently using for a loan modification negotiation. Since the company is not listed with the Better Business Bureau, can you tell me anything, good or bad, about it?
Answer: I do not know the company you mentioned in your email (I purposely did not identify it in your question). But even if I did know the company, I could not give you a recommendation, one way or the other. You are right to be concerned, though. So many rogue outfits have taken advantage of already financially strapped folks that the authorities are starting to crack down, big time.
Just recently, several federal and state agencies announced a joint effort to stop scam artists who target troubled owners struggling to hold onto their homes. "If you prey of vulnerable homeowners," U.S. Attorney General Eric Holder said in a press conference, "we will find you and we will punish you."
As part of the initiative, the Treasury Department's Financial Crimes Enforcement Network has issued an advisory to help financial institutions spot questionable loan modification schemes and report that information to the authorities. FinCen, working with other law enforcement agencies and regulators, will identify possible suspects for civil and criminal investigations.
"We will shut down fraudulent companies more quickly than before," said Treasury Secretary Timothy Geithner, vowing to target "companies that otherwise would have gone unnoticed under the radar."
Calling perpetrators of fraudulent rescue schemes "bottom feeders," Federal Trade Commission Chairman Jon Leibowitz cited five new cases that have been brought against companies who "kick people when they are down, sabotaging" their efforts to save their homes. Four of the cases name outfits which use "copycat names and logos" to try to trick homeowners into thinking they are working with legitimate government agencies, while the fifth calls itself the "Federal Loan Modification Center" even though it has no federal connection.
The FTC also has sent warning letters to 71 additional possible scam artists who promise to stop foreclosures, save people's houses and claim a 97% success rate of doing so.
Such companies "will promise" to do these tings "but they don't," said Illinois Attorney General Lisa Madigan, speaking for the states. "All they do is take your money."
Of course, borrowers like you are the first line of defense against fraudulent loan modification and foreclosure rescue schemes. To protect yourself:
Beware of the come-ons. They may promise to intervene on your behalf with your lender, stop foreclosure proceedings in their tracks or claim a 97% success rate. These kinds of boasts are tell-tale signs that a rip-off lies ahead.
Don't pay for a promise. Keep your hand on your wallet if anyone asks for money in advance. Pay only for services rendered, after they are rendered.
Check with the authorities. Besides checking with the Better Business Bureau in your town, see if any charges have been brought against the company with the FTC as well as the agency in your city, county and/or state which regulates lenders or real estate companies. In California, that's the Department of Real Estate in Sacramento.
Make payments to your lender and only your lender. If you give your house payment to anyone else, there's a good chance they will pocket it rather than pass it along.
Run from any person or company that tries to make it look like they are part of the government. They are not. If you want to contact a government agency, type the Web address directly into your browser and look up any address you are not sure about. Use phone numbers listed on agency Web sites or in other reliable sources, like the Blue Pages in your phone directory.
Second opinions don't work. If you have been turned down by your lender, you have been turned down. Don't pay for another opinion.
For free, personalized advice from counseling agencies certified by HUD, call 888-995-HOPE. This national, 24/7 hotline is operated by the Homeownership Preservation Foundation, a nonprofit member of the Hope Now Alliance of mortgage industry members and HUD-certified counseling agencies.
Q: My client put her children on the deed to her home. Now she wants to do a reverse mortgage. All of the siblings have agreed to sign a quit claim deed withdrawing their claims to their ownership interest in the property; all, that is, except for one who is refusing to go along with her brothers and sisters. Is there anything that the Mom or the other children can do to force her to sign?
A: Nothing short of peer pressure and a good attorney. But then I doubt even a skilled barrister can make someone do something they don't want to do, especially if they are legally within their rights. Now, having said that, I'm sure we'll here from a bunch of lawyers. So let's just sit back and see what the mail bag brings.
Stay tuned!
Feedback
Tracy Cavanaugh, a certified mortgage planning specialist who hangs her shingle at America's First Funding Group in Neptune, N.J., says the California reader seeking advice about refinancing (Realty Q&A, March 27, 2009) might want to consider the Obama administration's Making Home Affordable program. See previous Realty Q&A.
Since the underwater homeowner did not have mortgage insurance on her original loan, Cavanaugh thinks "this is a great option for her," especially with mortgage rates as low as they are right now.
Under the Obama plan, she can refi into another loan, again without mortgage insurance, the mortgage specialist writes. "This way, she gets into a fixed monthly payment, as there is no way fixed rates are going to be this low in 12 months. (Rates) are dying to jump higher and it is insanity to be betting on (an adjustable-rate mortgage that resets) 12 months hence! Beyond that, she can preserve her $40,000 of liquidity and then concentrate on what she is doing with respect to her time horizons after she closes."
For more information on the administration's refinance program for underwater borrowers, go to www.makinghomeaffordable.gov.
Nationally syndicated columnist Lew Sichelman has been covering the housing market for more than 35 years. Because of the volume of mail he receives, he cannot answer individual questions, nor can all questions be answered in this space. Email lsichelman@aol.com
The Squeeze on Jumbo Mortgages
Remember how buying that big house seemed like such a good idea? The amenities, the extra space, the ability to impress your friends — as the recession grinds on, you’d trade all that for smaller utility bills, lower property taxes, and less square footage to mow, vacuum, dust, repair, and repaint. And you’d like to deal with a not so big mortgage. As the credit crunch lingers, that may be the biggest headache of all.
While home loans in general have responded well to the Federal Reserve’s efforts to lower interest rates, that’s not true of the plus-sized loans the industry calls jumbo mortgages. That’s because the secondary market for jumbos has been largely wiped out by the crisis. As a result, if you are looking to refinance one, you should expect the lender to require a much higher interest rate and down payment than for a standard mortgage. The tougher terms likely make your home less attractive to potential buyers, who — even if they can handle the costs of your home — may not qualify for a jumbo loan.
And if all that’s not bad enough, what little help you were getting from the government with the costs of the loan may be slashed soon. The Obama Administration’s budget proposes slicing mortgage deductions for families with incomes over $250,000.
What a Jumbo Mortgage Is
A jumbo mortgage exceeds the size automatically accepted by secondary mortgage lenders Fannie Mae and Freddie Mac, what’s known as “the conforming limit.” In most places, this means a mortgage over $417,000 in 2009; in high-cost housing areas, a mortgage exceeding $625,500 is a jumbo. (The Federal Housing Finance Agency lists jumbo limits around the country).
Lately, the interest rate on a 30-year fixed-rate jumbo has been about 1.5 percent higher than a non-jumbo — or around 6.4 percent. The rate on a jumbo 5/1 ARM (the rate is fixed for five years and then resets annually) has been about .6 percent higher than a comparable, non-jumbo 5/1 ARM, though about 1 percent lower than a 30-year fixed-rate jumbo. Expect to make a down payment of up to 40 percent for a jumbo, and to provide extensive documentation of your income and creditworthiness.
The Vise May Tighten
As if the squeeze on jumbo borrowers wasn’t painful enough, it may get even worse. The Obama Administration’s proposed 2010 federal budget would restrict the amount of mortgage interest that households with incomes over $250,000 could deduct — those in the 33 and 35 percent brackets. You’d need to calculate the write-off as though you were in the 28 percent bracket. That could slash your interest write-off on a $425,000, 30-year jumbo loan from $7,100 a year to $6,000 a year. You can do your own calculation at Bankrate.com’s mortgage tax deduction calculator.
What’s more, with a smaller write-off, lenders would require you to show a lower debt-to-income ratio than they would today, to ensure that you can afford the higher after-tax monthly payments. Losing part of the deduction would hit high-income clients hard, says Tracy Cavanaugh, lead planner for the CS Advisory Group, a mortgage broker with offices in California and New Jersey.
What to Do Now
During the real estate bubble, jumbo lenders often customized the mortgages through “creative” loans for professionals, the self-employed, and business owners. Now that the bubble has burst, many traditional jumbo lenders are in trouble and shutting their doors. So your best bet for finding a jumbo is to go to a state-chartered bank or credit union that didn’t get caught up in the mortgage frenzy.
Get the article online-http://moneywatch.bnet.com/saving-money/article/the-squeeze-on-jumbo-mortgages/295097/
Mortgage relief plan seen as "great first step' for area”
By Michael L. Diamond• BUSINESS WRITER • February 19, 2009
President Barack Obama on Wednesday ratcheted up pressure on lenders to modify troubled mortgages and cleared the way for some homeowners worried about losing their homes to get more affordable loans.
The announcement of his $75 billion mortgage relief plan was a step in restoring confidence to a housing market that has been reeling for more than a year, observers said.
"It's a great first step," said Tracy Cavanaugh, president of the CS Advisory Group, a Neptune-based mortgage consultant. "As it relates to the psychology of us as a country, it's a relief. It helps to diminish the uncertainty. At least we're going to move in a positive direction."
Obama's plan is the federal government's latest attempt to solve a problem that started with borrowers who were approved for loans they couldn't afford. That turned into an avalanche of falling home prices, job losses and home foreclosures.
While particularly acute in fast-growing states such as California, Nevada, Arizona and Florida, New Jersey and the Shore haven't been immune to the foreclosure crisis.
Last year, New Jersey foreclosures rose 39 percent; Monmouth County foreclosures rose 33 percent; and Ocean County foreclosures rose 44 percent, according to the state Department of Community Affairs.
Experts believe the number of foreclosures will increase this year as the economy deteriorates and more workers lose their jobs.
It has left some people in the same situation as Maria Licciardello, 50, of Barnegat. She has lived in her home since 1982, raising her two daughters and paying the bills, even after her husband died in 2000.
A directory assistance operator for Verizon Communications Inc., she took a buyout last year, certain she soon would be replaced by technology. But with the job market in tatters, she hasn't found another job. She fell behind on her mortgage two months ago.
She applied with her mortgage company for a loan modification, but has yet to hear from them.
"It's terrible. I went to a job interview today. It was the second call. I walk in there and he tells me the position has been filled," Licciardello said. "I was really gung-ho today that I was going to be able to call the mortgage company and say, 'Look, I have a job now.' Maybe it will be easier to get a modification if you have some income."
Obama's plan is targeted to help:
-- Borrowers with subprime loans. Their interest rates have risen so high that their mortgage payments consume as much as half of their monthly income.
The Treasury Department will provide $75 billion to subsidize lenders and help reduce the payments to no more than 31 percent of borrowers' monthly income. It will give servicers financial incentives to modify at-risk loans before the borrower falls behind.
Here’s one way to pay for the economic stimulus: Have President Obama’s cabinet pay their taxes. Ba-dum-dum.
But seriously, folks. This being a business blog means we sometimes have to delve into excruciatingly dull material. And today’s topic is mark-to-market accounting, in particular the Financial Accounting Standards Board rule No. 114, which requires companies to value assets based on what they could get for them in the market today.
The idea goes like this: Let’s say, oh I don’t know, Citigroup owns an airplane that’s valued at $50 million. It can sell it for $50 million in the market. So the asset is worth $50 million.
Now let’s say Citigroup owns a bunch of mortgages that have been bundled into a security. Three years ago, everyone in the bundle paid their mortgages on time and Citigroup could have gone into the market and sold the security for $50 million. Today, some home owners are paying, some aren’t. And investors wouldn’t touch the security if Citigroup gave it away. What’s it worth?
If you are playing by mark-to-market rules, it’s a total guess, but let’s say 10 cents on the dollar. Citigroup has to write the asset down to $5 million. It cuts into earnings. It reduces capital. And it decreases the amount it can lend, freezing the credit markets even more.
The idea is to provide investors with transparency, which Neptune-based mortgage expert Tracy Cavanaugh told me will be the word of 2009.
As a reporter, I love transparency, but I might be in the minority here. A rising chorus is calling on the SEC to suspend the mark-to-market rules, noting that it’s not like Citigroup is going to sell these securities today, particularly not when the market value is, like, zero. So why not temporarily suspend the mark-to-market rules?
“Banks are saying, ‘Why do I need to do that if I am going to hold them to
maturity and get my money back?’” says James Vaccaro, CEO of Central Jersey Bancorp in Ocean Township, whose own bank has avoided mortgage-backed securities. “I’m a true believer in common sense. You need to look at the circumstances surrounding the assets. Now is not a great time to be forced by accounting firms to write this down.”
What's the score?
Credit scores, the formula used by lenders to assess risk, are supposed to provide a window into consumers' financial souls.
A divorce and a bankruptcy left Mario Galluccio with a credit score somewhere in the 400s and his financial independence stripped away.
He couldn't rent an apartment, so he had to move in with a sibling. He couldn't buy a car, so he needed his mother to co-sign on a loan. He didn't have a credit card, so he needed to pay for items in cash.
"It was very difficult," Galluccio, 39, of Brick, said nearly a decade after the experience. "You can't do anything."
With defaults rising and the economy in turmoil, more Shore-area consumers are becoming familiar with their credit score.
The calculation is so powerful that it can determine whether you get approved for a loan, what interest rate you pay and even if you will be hired.
It's not without critics, who note the increasing reliance on credit scoring did little to prevent a financial catastrophe. But even now, the game remains the same. A high credit score and the world is at your fingertips. A low score and it is rocky days ahead.
"It's a game," said Vic Melillo, owner of Let's Talk Credit Scores, a Brick company that advises consumers.
A decade ago, consumers who tucked away cash were rewarded. "Today, that person can suffer because without a (high) score, lending could be difficult or impossible," Melillo said.
Here is a primer:
What is it? A credit score is a calculation that was developed by engineer Bill Fair and mathematician Earl Isaac at Stanford Research Institute. They wanted to create a financial scorecard to help lenders judge an applicant's credit risk.
Their company, Fair Isaac Co., introduced the FICO score that today is used by the three credit-reporting bureaus — Equifax, Experian and TransUnion.
Lenders then pay the credit agencies to view the score and decide not only whether to approve a borrower, but also what interest rate to charge. Consumers can view their credit report for free at www.annualcreditreport.com, but they need to pay to view their credit score.
How is the score determined? The FICO score is derived from five categories — payment history, amounts owed, length of credit history, new credit and the types of credit used. Credit cards carry more weight than mortgages or car loans.
The FICO scores range from rock-bottom 300 to gleaming 850. The credit-reporting bureaus have their own credit-scoring system, but lenders typically pay closer attention to FICO.
"It predicts the likelihood that you or I will be at least 90 days late paying any one of our creditors within the next two years," said Craig Watts, spokesman for Fair Isaac Corp. in Minneapolis.
Who uses it? The credit score is used by lenders, whether it is to approve a mortgage or an automobile loan. And the idea has gained popularity among employers doing background checks on job applicants and insurance companies deciding what rate to charge customers.
"There's been research that's shown there's a correlation between how responsibly someone handles their finances and how they drive," said Rachael Moore, director for the Insurance Council of New Jersey, a trade group.
Why is it so important today? Lenders earlier in the decade eased their underwriting standards and offered credit to some customers with scant proof that they could pay it back. Now with banks reeling from loans that went into default, the pendulum has shifted; lenders are cautious.
It means home buyers need credit scores of at least 550, and more often 600, to get approved for a government-backed mortgage. And they need credit scores of more than 680 to get approved for a conventional loan, said Tracy Cavanaugh, a mortgage specialist with the CS Advisory Group in Neptune.
Before the housing bubble collapsed, lenders stamped approval on consumers with scores of 500. "That's incredible," Cavanaugh said. "There was a premium and higher (interest) rate for that, but the fact of the matter is, that opportunity was there."
"Banks want no risk," said Rich Matthews, president of Red Bank Volvo Inc. in Shrewsbury, adding that even customers with strong credit scores can get denied if they have too much debt.
What does it take to get a pristine credit score? Consumers need to pay their bills on time and maintain somewhat of a balancing act. They are docked for maxing out their credit cards and not using them enough, Melillo said.
"If you go six months in a row with no activity, your risk score is not calculated because of a lack of recent activity," he said.
How fair is that? The FICO score has been lauded for creating a quick snapshot of a borrower that avoids discrimination. But Melillo and other experts said credit scores replaced personal contact that might have stopped risky loans.
"The (larger) banks removed their analysts years ago because there's a cost to it instead of revenue generation," Wall-based economist Robert Angelone said. "They stopped doing due diligence. What they relied on was an electronic data profile of the borrower — the credit score. That information takes a snapshot of an individual at a given moment, but it doesn't tell them what their actual ability to pay is."
Are you doomed if you have bad credit? No. It may be more difficult to rent an apartment or buy a car. But consumers can improve their scores by using a credit card sparingly and paying off the balance each month.
One note of caution: Be wary of companies that make promises such as getting negative reports removed.
"The only things that will improve your credit score are time and consistency," said Carolyn Tarrant, director of education and community relations for Money Management International, a credit-counseling agency in Tinton Falls.
Galluccio is an example. After his bankruptcy, he got a secured credit card that had a low limit and required him to put up collateral. Then he was approved for an unsecured credit card, which doesn't require collateral. And he built his credit score above 700.
"It does take some time," Galluccio said. "I'm not going to tell you it happens overnight. But little by little it gets up there. I can't remember the last time I applied for something and got denied."
Michael L. Diamond (732) 643-4038 or mdiamond@app.com
Funds to Bolster local banks
BUSINESS WRITER • January 8, 2009
BY MICHAEL DIAMOND
Toms River-based OceanFirst Financial Corp. and the parent company of Middletown-based Two River Community Bank are expected to receive money from the U.S. Treasury Department's program designed to bolster banks, company officials said Wednesday.
OceanFirst was approved to receive $38.3 million. Community Partners Bancorp was approved to receive $9 million. Bank executives said the money would give them a cushion during the economic downturn.
"We absolutely, unequivocally plan to use this capital to grow this institution," said William D. Moss, president and chief executive officer of Two River Community Bank. "These are very difficult times, but they also represent an opportunity for Two River to continue to grow its market share."
OceanFirst has 23 branches in Monmouth, Ocean and Middlesex counties and $1.9 billion in assets. Community Partners has 11 Two River Community Bank branches in Monmouth County and $563.8 million in assets. It also owns The Town Bank in Westfield.
They join Central Jersey Bancorp in Ocean Township as Shore-based banks that are receiving money from part of the government's Troubled Asset Relief Program, which is being used to buy stakes in what are considered healthy banks.
One goal of the $700 billion program is to prompt banks, jittery from losses on bad mortgage loans and an economy that's in a recession, to resume lending and kick-start the economy.
The credit slowdown has been blamed for sending the economy into a deeper recession, and the Shore hasn't been immune.
The credit slowdown has affected:
Automobile sales. Some banks have left the automobile lending business. Others require more documentation or more of a down payment.
GMAC, which received $5 billion from the Treasury Department program, has resumed lending, offering a glimmer of hope, said Ernie Marino, general manager for Pine Belt Automotive, a Toms River-based company that owns four dealerships.
"It's definitely somewhat of a handicap" to sell cars, Marino said. "You have to work harder."
Business expansion. Small businesses have been required to put up more collateral to receive lending. It has prompted some companies to turn to new programs introduced last month by the state that give small-business owners rebates and loans to help them expand.
The state has received 200 calls and e-mails since the programs were announced within the past month, said Glenn Phillips, spokesman for the New Jersey Economic Development Authority.
"Early interest has certainly been strong," Phillips said.
Home sales. Buyers now need to prove their income, provide a down payment and have a high credit score, said Tracy Cavanaugh, a certified mortgage planner with America's First Funding Group in Neptune.
"People are definitely lending out there, just not as freely as before," Cavanaugh said. "The reality of this market is, we've got tighter credit conditions, and we should because not having standards in place last time is what got us into this mess."
OceanFirst executives said late Wednesday it planned to use the money to strengthen its balance sheet and continue to lend.
Community Partners executives said they have loaned money prudently. But they decided to apply for the Treasury program because the faltering economy makes it difficult to raise capital through a public offering or private placement.
"The traditional capital outlets available to us as a financial institution have become almost nonexistent," said Michael J. Gormley, chief financial officer of Community Partners Bancorp.
For its investment, the Treasury Department receives preferred stock, which means it recoups money before other shareholders in case of bankruptcy. It receives an annual 5 percent dividend for the first five years and an annual 9 percent dividend after that. And it receives an option to purchase common stock in the future.
Michael L. Diamond (732) 643-4038 or mdiamond@app.com
The Roof Is Leaking
JANUARY 08, 2009 • 11:20 AM
BY
MICHAEL DIAMONDThere are rising concerns that the $700 billion TARP program being operated by the U.S. Treasury Department isn’t benefiting the taxpayers who are funding the program.
The government is funneling money to healthy banks in hopes that they will make more loans and get the economy moving again. But banks are sitting on that money, protecting their balance sheets, because the economy isn’t moving. It’s a Catch-22 that has us spinning our wheels so fast that we fall deeper into a hole. You can’t blame banks. Consumers’ incomes didn’t rise very fast - if at all - during the past decade. Consumers have fallen deeper into debt. Their homes are losing value. Their jobs are on the line. And healthy banks are healthy banks for a reason; they made loans to consumers who could afford to pay them back. They aren’t likely to loosen their underwriting standards
now.A rising chorus is saying the U.S. will continue to act like one of those toy robots that marches into a wall until the battery runs out until it gets at the root of the problem: Stabilize housing. (How maddening is it that we’ve been talking about this for almost a year and nothing has happened? Most of the home owners who try to re-work their mortgages are denied.) Here are two ideas to ideas to look for. *Extend the mortgage terms for distressed home owners from 30 years to 40, 50, even 75 years. This will lower home owners’ payments. It keeps them in their homes. It retains property values. And they can refinance when the economy improves, said Robert Angelone, a Wall-based economist.
He’s not alone. Neptune mortgage broker Tracy Cavanaugh mentioned the idea to me yesterday, too. "The last piece of the puzzle is, what do we do with the underwater home owner or the owner who is about to get foreclosed on?" she said. *Give TARP money to agencies that don’t have a profit motive. The government’s laissez faire policy of allowing banks to voluntarily rework distressed mortgages is like…is like…ah, heck, I can’t think of a good metaphor. Let’s just say, it doesn’t work. One proposal quietly being discussed is to let nonprofit groups receive taxpayer money to buy distressed mortgages at a discount. It would save the bank foreclosure costs. It would help home owners get affordable payments. It would cut through the ridiculous bureaucracy. And once the market stabilizes, the organization could sell the mortgage to private investors, who, a year or two from now, might be content with a 4 percent or 5 percent return. "This relief has to start from the ground up," said David Petrovich, executive director for the Society for the Preservation of Continued Home Ownership, an Ocean Township group that is working on details of such a plan.
Jersey foreclosure filings on the rise
Data show state ranks eighth in the country
A total of 17,893 New Jersey homeowners either got a default notice in the mail, were warned of a pending auction or had their homes seized by their lenders between July and September, according to RealtyTrac, a Irvine, Calif.-based company that tracks foreclosed properties. That was more than 3 percent higher than the second quarter.
"We're seeing slowness now that you would expect in an economy that is having trouble," said Chris Martin, president of Jersey City-based Provident Bank. "But certainly, if unemployment continues to tick upwards, it will affect people's capacity to pay everything from their credit cards to their mortgage."
Of the 100 top metropolitan areas listed by RealtyTrac yesterday, Newark ranked 38th, Camden ranked 39th and Edison ranked 47th.
In September alone, New Jersey rang up 7,658 foreclosure filings in a single month, up more than 48 percent from the same time last year.
That means one in every 453 households received a foreclosure filing during in September, as declining home prices and stricter lending requirements continued to worsen the foreclosure environment.
Month over month, foreclosure filings in New Jersey climbed 18 percent from August to September.
Currently, the state has the eighth-highest foreclosure rate in the country, according to RealtyTrac, whose data has become a closely watched barometer of the real estate market.
Other states with foreclosure rates ranking among the top 10 in September include Arizona, Georgia, Michigan, Ohio, Indiana and Colorado, according to RealtyTrac.
By the end of the year, RealtyTrac said it expects more than a million bank-owned properties to have piled up on the market, representing around a third of all properties for sale in the United States.
Tracy Cavanaugh, a mortgage planner who runs Neptune-based CS Advisory Group, said that while the government's $700 billion financial bailout of Wall Street is a good start, it is time for policymakers to bring that same kind of relief to homeowners.
"This thing needs to be corrected right at the heart of the problem. At the end of the day, it's of critical importance that we focus on the homeowner and keeping them in their homes," Cavanaugh said. "If not, we are going to be flooded with more inventory and it just becomes this vicious downward spiral. We need to provide relief to homeowners because once we do that, we can put a floor down on the foreclosure problem and maybe get some traction." Read More
PERSON OF THE WEEK: Tracy Cavanaugh On Bailouts And Lending Mistakes
By Jessica Lillian on Tuesday 30 September 2008
This week, MortgageOrb spoke with Tracy Cavanaugh, a Certified Mortgage Planning Specialist (CMPS) and principal of the CS Advisory Group Division of America's First Funding Group. Cavanaugh explains why all of the market uproar right now has created an urgent need for careful attention from boath loan originators and borrowers - and why some are seeing great opportunity even in the face of bad news. Read More
Ask the Biz Brain
By Tom Johnson, Star-Ledger
As a retiree, a considerable portion of my IRA was invested in Fannie Mae and Freddie Mac for security reasons. Will I get any part of this money back as a result of the U.S. takeover?
-- IRA blues Unfortunately, as with most of the rest of the financial news these days, the outlook is dim in the short term and only marginally better in the long run, experts consulted by the Biz Brain advise...Read More
Q&A / MORTGAGE, FINANCIAL EXPERTS: Treasury plan amounts to ‘vitamin B-12 shot’
Like it or not, every man, woman and child in America is now a Fannie Mae and Freddie Mac shareholder.
From the get-go, the two quasi-government entities, which purchase more than 70 percent of all new home mortgages in the United States, had an implicit guarantee taxpayers could be on the hook if things went awry...Read More
Mortgage bailout: Cheaper lending, more taxpayer risk
The federal takeover of Fannie mae and Freddie Mac should make it easier for borrowers to get mortgages and should bring down the interest rates they pay. But taxpayers are on the hook for future defaults.
Like it or not, every man, woman and child in America is now a Fannie Mae and Freddie Mac shareholder. From the get-go, the two quasi-government entities, which buy more than 70 percent of all new mortgages in the U.S., had an implicit guarantee that taxpayers could be on the hook if things went awry...Read More
Fallout From the Bailout
By Sam Ali, Star-Ledger Staff
Like it or not, today, every man, woman and child in America became a Fannie Mae and Freddie Mac shareholder.
From the get-go, the two quasi-government entities, which purchase over 70 percent of all new home mortgages in the United States, had an implicit guarantee taxpayers could be on the hook if things went awry.....Read More
Mortgage brokers' move to planning rankles advisers
By Jeff Benjamin, Investment News
DETROIT - Mortgage brokers, known largely for earning commissions based on the size of the loans they write, might seem to represent the opposite of fiduciary responsibility, but a growing number of these brokers are finding opportunities in financial planning.... Read More
