mortgage crisis Archives - FREE CONSULTATION

Relaxed Mortgage-Lending Rules APPROVED!

Posted on October 27, 2014by Admin

Three U.S. agencies signed off this week on relaxed mortgage-lending rules. These new standards represent an effort to ensure more mortgage loans are available for borrowers. The Federal Reserve, Securities and Exchange Commission and Department of Housing and Urban Development approved the new rules for the mortgage-backed securities market, a day after three other agencies approved the standards.

The rules are intended to improve the quality of loans by giving banks a financial incentive to ensure mortgages can be repaid. The initial rules required that banks hold 5% of the risk of mortgages packaged and sold to investors or require a 20% borrower down payment. But regulators, concerned that overly stringent rules would harm the housing market’s recovery, recanted on the 20% down payment.

Instead, banks will be able to avoid the 5% risk-retention requirement if they verify a borrower’s ability to pay back the loan and comply with other requirements, such as ensuring borrowers’ debt payments do not exceed 43% of their income.

Officials say these standards are still sufficiently strong enough to prevent a repeat of some of the worst abuses from the housing market crisis, including loans in which the lender does nothing to verify a borrower’s income. The new rules, which go into effect in fall 2015, will be reviewed for its impact on the economy four years later, and every five years after that.

Click here to read more on this story.
http://online.wsj.com/articles/divided-sec-signs-off-on-relaxed-mortgage-lending-rules-1414009530

Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

BOA’s $17 Billion Mortgage Settlement Explained

Posted on September 8, 2014by Admin

Bank of America has agreed to a legal settlement with the Department of Justice to avoid prosecution for hundreds of billions of dollars in bad mortgage loans, making it the largest corporate legal settlement with the government in U.S. history. The total “on-paper” cost of the deal is reportedly as high as $17 billion. But many are calling the deal deceptive. In reality, the settlement is unlikely to cost BOA anywhere near that amount. Much of the deal will be tax deductible and half of its cost is made up of actions on behalf of homeowners that are in the bank’s best interest- not in the form of cash refunds that will cost the bank money.

So what does this settlement mean for struggling borrowers and underwater homeowners? While the details are still being worked out, the deal includes roughly $9 billion in cash payouts and $7 to $8 billion in “consumer relief” actions such as mortgage write-downs and refinancing for struggling borrowers. These consumer relief provisions do not require the bank to spend money they would not already spend in the normal course of business operations. For BOA, helping people stay in their homes and keep making payments is better for the bank’s revenue than foreclosing on struggling homeowners.

The settlement requires BOA to relax loan terms, reduce principal amounts and destroy abandoned properties that are hurting property values. Even at face value, the reported settlement is minuscule compared to the harm caused by Bank of America companies. The on-paper cost of the deal is less than 7 percent of the value of the mortgage deals Bank of America and its subsidiaries Countrywide and Merrill Lynch made before the housing crisis that have since gone bad.

Credit, Foreclosures, Timothy Kingcade Posts

Walking Away from your Underwater Mortgage Becoming More Socially Acceptable?

Posted on December 24, 2012by Admin

Five years after the mortgage crisis and the housing bubble burst, more Americans are deciding that it’s okay to walk away from their underwater mortgage payments. In a recent survey conducted by JZ Analytics for ID Analytics, 32% of more than 1,000 respondents said they “believe homeowners should be able to strategically default on their mortgages without any consequences.”
Today, there’s obviously still a social stigma to walking away from an underwater home, given that the other two-thirds of respondents didn’t find it acceptable. In addition to shame and guilt, people also have to face a sense of loss, since most people are emotionally attached to their homes. There are practical considerations, too: the stress of being hounded by collectors, the knowledge that you are ruining your credit, and the possibility of being sued by the lender.
There is also community pressure to avoid foreclosure. Defaults can hurt nearby property values a 2010 study revealed. Despite all of this, attitudes have clearly changed. The idea that only ‘deadbeats’ default on their mortgage payments is a thing of the past. The ID Analytics survey found that 17% of Americans know someone who has strategically defaulted on a mortgage. What’s more, many people now recognize that companies are often able to declare bankruptcy and either shed or restructure their debts without long-term consequences.
To read more on this story visit: http://business.time.com/2012/10/15/is-the-stigma-of-ditching-your-underwater-mortgage-fading/?utm_source=contactology&utm_medium=email&utm_campaign=InChargeInsiderMarch
Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Foreclosure defense attorney, Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia, P.A. website at www.miamibankruptcy.com.