Bank of America announced Tuesday (01/26) that it is the first mortgage servicer to sign an agreement formally committing to participate in the second-lien component of the Home Affordable Modification Program (HAMP).

The news follows a “verbal commitment” to the program made by CEO, Brian Moynihan made during a meeting with Treasury Secretary, Timothy F. Geithner earlier this month, the company said in a statement.

The Charlotte, North Carolina-based bank says it has systems in place to begin implementing the administration’s Second Lien Modification Program as soon as the Treasury releases final program policies and guidelines. Federal officials first introduced 2MP last April, but since then most market observers have labeled the program as “on hold.”

The Treasury has estimated that up to 50 percent of at-risk mortgages have second liens. The 2MP piece of the administration’s multi-pronged mortgage relief program will require modifications that reduce the monthly payments on qualifying home equity loans and lines of credit when a HAMP modification on the first mortgage is carried out.

The federal government is encouraging lenders and servicers to sign up for the second-lien program, William Apgar, HUD’s senior adviser for mortgage finance, said Tuesday at a housing conference in Washington, according to Bloomberg News. Second liens are “not an easy problem to solve,” Apgar said.

“For many homeowners facing severe financial difficulty, decreasing the payment on the first mortgage without a reduction in the payment on the second lien may not produce an affordable combined mortgage payment,” said Barbara Desoer, president of Bank of America Home Loans.

Desoer said inking the contract before the final program guidelines are released demonstrates “Bank of America’s strong overall commitment to homeownership retention and to the Making Home Affordable program.”

Bank of America is the nation’s largest mortgage servicer, with a servicing portfolio of nearly 11 million first mortgages and 3 million second liens. Through its participation in 2MP, BofA says it will modify eligible second liens regardless of whether the first lien is serviced by Bank of America or another participating servicer.

“2MP will become a valuable addition to Bank of America’s broad toolkit of potential solutions for customers facing financial difficulty and will increase our ability to help even more homeowners,” Desoer said.

Using non-government programs, Bank of America says it modified more than 57,000 second liens to assist financially strapped homeowners over the last two years.

Source:  Carrie Bay (DSNews.com)

Share the wealth:

Fannie Mae’s latest offering

At the brink of loosing your home? You might qualify for a special program. A deed for lease program, implemented in November by Fannie Mae ( buyer of existing home mortgages). 

This program basically allows the borrower to lease back the property from the lender- your signing a lease to the property. You must qualify. You become a tenant rather than an owner, but you get to keep your house for the time being.

This program is targeted for those that do not qualify or have not been able to obtain a modification or other solution to the problem. What happens is borrower transfers property to lender by completing a “deed in lieu of foreclosure” document, and then lease back the property at the current market rental rate.

 Some guidelines:

• Borrower must live in the home as primary residence.
• Must be released from any subordinate liens on the property
• Current rental rate must be less than 31% of gross income. (Must show proof)
• Leases may be up to 12 months, possibly a term renewal after 12m or month-to-month extension.

This is a great program for those struggling to make payments. Now, this is easier said than done. As you can expect, it requires a lot of paperwork and patients.

For professional advice on all aspects of buying or selling Real Estate, please contact me Richard Recuset at: 786-287-9272 -email: Richard@teamDoral.com

NEW YORK (Bloomberg News) – Another program has been set in motion to keep homeowners out of foreclosure. Homeowners who can’t get a loan modification may be eligible to transfer ownership to Fannie Mae and rent their home at market rates.

Homeowners must sign their deed over to the lender and be released from any second mortgages. The rental rate can be no more than 31 percent of their gross income.

Leases can be up to 12 months long, and borrowers can extend them month-to-month after that.

The program is designed to keep families in their homes and cut criminal defacement of vacant homes.

Read additional info here.

For more information on building, buying, selling or leasing commercial or residential property anywhere in the world, contact Nicole Tucker, licensed agent with Keller Williams, Dallas Preston Road office at 972-992-8204 or visit my website at http://www.NicoleRE.com.
Nicole Tucker ~ Making Real Estate Real Easy!

Did you know that you can purchase a property and include up to $35,000 in rehabilitation costs in the loan through an FHA 203K program? This program is designed to give homebuyers and homeowners the opportunity to improve their homes including making them more energy efficient. The streamlined 203K program is intended to facilitate uncomplicated rehabilitation and/or improvements to a home for which plans, consultants, engineers and/or architects are not required. Some of the common repairs that you can utilize this program for are: repair/replacement of roofs, repair, replace or upgrade HVAC systems, remodeling kitchens, interior and exterior painting, weatherization and the purchase and installation of appliances.

The FHA 203K loan is an important tool for community and neighborhood revitalization and for expanding homeownership opportunities.

The 203K program will allow you to repair, replace or add exterior decks, patios, or porches.

You can utilize the 203K program to make accessibility improvements for persons with disabilities.

Along with EEM (Energy Efficient Mortgage) you can remodel your home to make it more energy efficient. These upgrades include storm windows and doors, insulation and weather stripping.

Given the need for homeowners to make minor repairs without exhausting personal savings, and in consideration of the increasing cost of materials, the minimum repair cost of $5,000 has been eliminated and the ceiling is now raised to $35,000.

The streamlined(K) program is also available for mortgage refinance transactions including those where the property is owned free-and-clear.

On 203K loans that do not exceed $15,000 in repair costs, the lender is not required to perform or have others perform inspections of the completed work.

Don’t overlook a good property that only needs some tender love and care to make it in to everything you would desire a house to be. The 203K program gives homeowner’s and homebuyer’s the opportunity to take a good house and make it great.

Many lenders have successfully used the Section 203(k) program in partnership with state and local housing agencies and nonprofit organizations to rehabilitate properties. These lenders, along with state and local government agencies, have found ways to combine Section 203(k) with other financial resources, such as HUD’s HOME, HOPE, and Community Development Block Grant Programs, to assist borrowers. Several state housing finance agencies have designed programs, specifically for use with Section 203(k) and some lenders have also used the expertise of local housing agencies and nonprofit organizations to help manage the rehabilitation processing.

Whether it is that fantastic foreclosure deal, adding that new deck, getting rid of that shag carpet, saving the purchase deal that the bank turned down due to property condition or making that simple change that turns an ordinary home into your dream home; FHA 203K can help you.

Most mortgage financing plans provide only permanent financing. That is, the lender will not usually close the loan and release the mortgage proceeds unless the condition and value of the property provide adequate loan security. When rehabilitation is involved, this means that a lender typically requires the improvements to be finished before a long-term mortgage is made. In the current market many of the numerous foreclosures sit on the market in disrepair due to vandals, theft and neglect. To lenders of traditional loans those properties are considered poor collateral that they’d prefer not to lend on. However, for FHA 203K loans the loan is based on after repair value and includes an escrow account to complete the repairs needed to bring the house to a condition that lenders prefer. That means that the current condition of the property is not as important on 203K rehab loan as the condition of the property once the 203K renovation is complete. This provides an outlet to purchase dilapidated properties, many of which have spent extended periods on the market due to the lack of availability to traditional financing, and solves the problem that most lenders face when dealing with property in disrepair. What this means to the home buyer is generally a significant discount to “as-is” value and, quite often, a fantastic deal on a house.

The easiest and quickest version is the FHA 203K Streamline. This loan is for repairs under $35,000 that do not involve any kind of structural renovations. For Streamline FHA 203K’s you will have two draws. Generally, the lender will release 35-50% upfront and 50% when the work is completed. On most of these the lender will require a final inspection to make sure the work is complete, but on some of the simpler 203K rehabs you can provide receipts showing materials have been purchased and that will be sufficient.

www.203Kloan.net is where I received the last 3 paragraphs. Let me know if you need more.

Obama’s recently began a program to modify home loans. It is now available for borrowers in financial difficulties and people that are in risk of losing their homes.

This new National program allows homeowners to revise their existing loan so that the monthly payment is reduced to an affordable amount.

The goal of Obama’s new program is simple. The idea is to keep families in their homes and stop foreclosures.

The plan is called the Affordable Home Modification Program. This loan house is paid for by federal tax dollars so do not hesitate to take advantage of this opportunity if you are in trouble.

Over five million property owners will benefit from this 75 billion government program.

1. All owners documents must be reviewed for eligibility, even if you have previously rejected.
2. Borrowers must show proof of financial difficulty or demonstrate that you are in immediate risk of defaulting on your loan.

If you meet the basic guidelines you will be invited to submit an amendment to the loan, Creditors will be paid by the Treasury Department using the federal standards.

If you are behind on your payments or find yourself in financial difficulty, the government encourages homeowners to begin the application process.

If you want to learn more about federal guidelines for the approval and what is necessary to adhere to these guidelines. Contact a professional home loan modification expert. This is not the time to take risks.

A borrower that meets federal qualification guidelines may be able to reduce the interest rate as low as 2%.