Right from the California Association of Realtors - This just In!

"Banks bite bullet on loans

A new report from the Office of the Comptroller of the Currency and the Office of Thrift Supervision shows that the portion of loan modifications in the second quarter that involved reducing the principal increased to 10 percent from 3.1 percent in the first quarter.

While strategies such as lowering interest rates or extending mortgage terms can temporarily help borrowers struggling to make payments, reports show that often times borrowers redefault because the modifications do not lower payments to a truly affordable level. Of loans modified in the first quarter of 2009, 28 percent were in default again within three months, according to the Office of the Comptroller of the Currency. Among those modified in last year’s second quarter, 56 percent were in default again a year later.

Banks are beginning to reduce mortgage principal due, in part, to prodding from the Obama administration, whose housing plan includes financial incentives for mortgage-servicing firms that modify loans. At the same time, banks now have more flexibility to modify loans because of their success in stabilizing their balance sheets and, in some cases, raising fresh capital."

I will say that this feels like the bottom. Unemployment rates are at an unbelievable high. We haven't seen numbers like this since 1994. Something needs to give. We must stand for something and soon! I am so concerned about our friends and our neighbors. Please reach out to your friends and neighbors and see what you can do to help. I think that if we humble ourselves and dig deep we can make a change in at least one persons life, even if it is our own. Right.

Reporting from Sacramento - Consumer advocates and a Santa Barbara lawmaker are urging Gov. Arnold Schwarzenegger to sign a bill that would protect homeowners from predatory firms that collect advance payments after bragging about their ability to persuade lenders to lower monthly mortgage bills.



What do you think? At Eye on Real Estate, we think it is about time.

As taken from the Los Angeles Times from October 2, 2009. This is encouraging news for people who need some relief. While taking steps to acquiring a loan modification are not for the weak of heart, it seems that many people are doing it and are successful. Read on:

"A report from federal regulators contains bits of encouragement for struggling homeowners seeking to have their mortgages modified. In the second quarter, 78% of loan modifications involved actually reducing borrowers' payments, up from 54% in the first quarter, the report says.

"The shift came as mortgage servicers became less likely to merely add missed payments to the balance of a reworked loan.The joint report from the Office of the Comptroller of the Currency, which regulates national banks, and the Office of Thrift Supervision, the federal overseer for savings and loans, surveyed servicers of 64% of all U.S. home loans.

"The agencies said they had seen "a significant shift from earlier practices, in which the vast majority of loan modifications either did not change or increased monthly payments."

"Mortgages on which monthly payments were reduced were less likely to go back into default than were loans that were modified without any payment reductions, the agencies said."

For more information about loan mod's, respond to this blog. At Eye on Real Estate, we are here to help! No strings attached!

Economic Hope

Happy Monday!

Well we have had our first taste of Fall. How spectacular the week-end was. And to come in to hear the mortgage news. According to Freddie Mac, 30 year fixed mortgages for borrowers with good credit falls below 5%! This is great news for all our buyers. This coupled with the $8,000 tax credit means big things for First Time Buyers.

You know, I think we will be able to make an impact on our economy people! We can do it! Let me know your thoughts!

Bobby