``The Obama administration has no plans to introduce another large-scale program to relieve the troubled housing market, despite the president's admission that his past efforts have not solved the problem, according to a senior administration official.''
Here is ONE simple solution; not the only one, but one that should help:
Many homeowners would stay in their homes and strugle thru paying their mortgage, if they could reduce their house payment.
I was going to say 1 in 3, BUT IT IS PROABABLY 1 IN 2 homeowners who would like to refi and get a lower rate CANNOT due to the appraisal.
If they are currently making their payment, how does it hurt the banks to
allow them to refi WITHOUT an appraisal - NO, they would rather have half of them walk away from their houses! This makes BANK SENSE!
Even HUD, who used to offer the Streamline refi with no appraisal have made it so difficult now to even do a stramline. They now do not allow the borrower to finance the closing costs- so, the RATE goes up for the Lender to pay the closing costs - THEN, they have DOUBLED the monthly MIP, even on a refi. So, even if the homeowner is coming down 1.5%, it is useless when the double the MIP and raise the rate to pay for the closing costs. Permalink
ok, want another BIG IDEA?
Bring back the FHA investor loan at 85% LTV for the investors to clear up the many houses on the market.
Have the banks offer "their famous NO doc loans" for investors WHO ARE WILLING TO PUT UP 25% DOWNPAYMENT.
NO, these silly Banks would rather sit on all this inventory and then SLASH the price to move it, not only causing tremendous losses, but also damaging the rest of the surrounding area.
who left the stupid banks in charge of all this? Permalink
want a third solution?
Allow HUD to refinance any present Mortgage where the borrower has reasonable credit and qualifies WITHOUT AN APPRAISAL.
Even allow those with only a 5.5% rate to go to their 3/1 ARM which is at 2.875%. Yea, in 4 years it can go up, but only a max 1%. so, for the next 5 or 6 yrs we have helped and slowed the foreclosures. 5 or 6 yrs from now, hopefully the market is better for them to sell their house, and hopefully people are back to work and unemployment is not 9.2%.
If their rate is over 5.5%, let them refi to a 30 yr fixed rate without an appraisal. If you lower all these payments, MANY would stay in their homes. Silly banks, are you listening?? Permalink