Entries in Mortgage (28)


Home Prices Highest Since April 2006

Creatas/Thinkstock(NEW YORK) -- Home prices in cities around the country surged 10 percent in the past year to highs that haven't been seen since the end of the housing bubble.

Prices around the country rose the most since April 2006, though in most places they are still well below their 2006 peak, according to the Case-Shiller house price index, which includes data through March 2013.

Phoenix, San Francisco and Las Vegas had the biggest jump in home prices, with increases of more than 20 percent compared with a year ago.

The housing market, while apparently on the road to recovery, is not yet fully healed.  A large number of homes are still in some stage of foreclosure and investors rather than first-time home buyers make up an outsized chunk of the housing market.

Many economists though are still confident that we are on the way to a healthy market. 

“This is not a bubble,” says economist Diane Swonk.  ”We are regaining lost ground which is a game-changer for most households since their home is what they rely on for wealth.”

Still the rise in home prices could be among the factors contributing to resilience in consumer spending despite a tax hike at the beginning of the year.  As home prices rise consumers feel confident to spend on other items like a new car.

The housing market in cities, including Seattle and Charlotte, is pushing back into positive territory after a couple of months in decline.  Prices were up 3 percent in Seattle compared with a month ago, and 2.4 percent in Charlotte.

Copyright 2013 ABC News Radio


Home Loan Delinquencies Plunge

Hemera Technologies/Thinkstock(NEW YORK) -- Mortgage delinquency rates are down to their lowest level in five years.

Credit reporting firm TransUnion says only 5 percent of people with home loans were at least two months behind with their payments in the final quarter of 2012.  That’s compared with 14 percent the year before.

This finding means that in the future, fewer foreclosure properties and short sales will be on the market.

Copyright 2013 ABC News Radio


Rule Would Protect Banks Against Mortgage Borrower Suits

Digital Vision/Thinkstock(NEW YORK) -- A regulatory change under consideration by bureaucrats in Washington would give banks new legal protections against being sued by borrowers.  Mortgage customers, for example -- those deemed most able to repay -- would effectively be prohibited from suing to stop foreclosures.

Kathleen Day, spokesperson for The Center for Responsible Lending, a consumer group, explains that the “legal shield” being contemplated by the Consumer Financial Protection Bureau (CFPB) would serve to implement the overriding purpose of the Dodd-Frank act: to force banks to take into consideration a borrower’s ability to repay when deciding whether to issue them a mortgage.

That assessment would include, for example, a review of a prospective borrower’s employment history and other outstanding credit obligations.

If and when a borrower who had been deemed able to repay were to bring suit to stop a foreclosure of his home, the judge in the case would be compelled to rule against the borrower and in favor of the bank.

It’s easy to see why lenders want such protection.  According to a Wall Street Journal story on the new shield, the seven biggest lenders in the U.S. have had to pay in excess of $76 billion on mortgage-related litigation since the popping of the housing bubble (as estimated by Credit Suisse Group).

Day stresses that the Consumer Financial Protection Bureau has not yet drafted a proposal for the shield.

“It’s just being talked about,” she says.  “It’s something under discussion.”

The CFPB, asked for comment by ABC News, has not responded.

Copyright 2012 ABC News Radio


Mass. Man Pays Off Mortgage with Pennies

Photodisc/Thinkstock(MILFORD, Mass.) -- A Milford, Mass., man saved his pennies to pay off his mortgage -- literally. He carted more than 62,000 pennies to the bank to make his last payment.

"Thirty-five years ago when my wife and I took out our mortgage for our first home I happened to pick up a penny in a parking lot," Thomas Daigle told ABC News. "I said, I'm going to pay our last mortgage in pennies.'"

And, that's exactly he did. In all, that's about 427 pounds of pennies at 145 pennies to the pound, though pennies minted after 1982 weigh in at 181 to the pound. Daigle says he didn't weigh them.

The 60-year-old, who would place his change and keys in a bowl each night, would sift through the change and save his pennies. On a rainy or snowy night in central Massachusetts, Daigle would roll three to five packs of pennies and place them in a box in the basement. Along with the pennies in a box downstairs, Daigle would keep a scrap of paper with a running tab of the amount of rolls stored in the boxes downstairs.

"After a few years of rolling pennies, I said this is a doable thing to pay my mortgage off in pennies," said Daigle.

In April, the co-owner of Joseph and Thomas Opticians brought the boxes of pennies around to the back at Milford Federal Savings and Loan Association and made his final payment on his 35th wedding anniversary.

Daigle warned the bank before coming in with the coppers. A long-time customer, Daigle opened a savings account at the bank when he was 10 years old using money he made from mowing lawns. At the time, one of his lawn customers was a teller named Mary, who worked at the bank.

"When it was time to get married and buy a house, this is the bank we wanted to use," said Daigle, who married his high school sweetheart Sandra in 1977.

"We're a local community bank and we've been in business for many years," a spokesperson for Milford Federal Savings and Loan Association told ABC News. "We are celebrating our 125th birthday this year."

Thomas Daigle "has been a customer of ours for a very long time and we were very pleased that he was able to accomplish his goals. It was a proud day for him. We are happy about that," the spokesperson continued.

He said his wife Sandra merely shakes her head and says "that's my husband," when asked about the penny savings.

"I'm a man of my word and I'm a man of commitment," said Daigle. "There is one thing you have in life: it's your word. If you say you're going to do something, do it."

Daigle says he's no longer saving pennies. "I never saved anything in my life other than pennies," he added. While coming in to the office, Daigle says he stumbled upon a penny and picked it up. He said he's hoping his lunch total is an odd number so that can get rid of it.

"I'm saving nothing," said Daigle. "I'm not leaving my children with any kind of mess to clean away."

He continued, "I'm collecting grandchildren. I have four grandchildren. I live for them."

Copyright 2012 ABC News Radio


Mortgage Rates Plummet to New Records

Digital Vision/Thinkstock(NEW YORK) -- If you can get a new mortgage or refinance an existing one, interest rates have fallen to incredible new lows.

For the first time ever, interest on a 15-year loan has dropped below 3 percent, according to data from Freddie Mac.  The rate is down to 2.97 percent this week from 3.04 percent last week.

The average rate on the 30-year loan also hit a new low, falling to 3.75 percent from last week's 3.78 percent.  The figure is the lowest since long-term mortgages began six decades ago.

If the economy doesn’t fall apart in other ways, these low rates may help the housing market as we are now in buying season.

Copyright 2012 ABC News Radio


Get Your Mortgage Paid for by Turning Your House into a Billboard

Brainiacs From Mars(BUENA PARK, Calif.) -- Need help paying your mortgage? If so, the marketing firm Brainiacs From Mars has a proposition for you.

“We’re looking for homes to turn into billboards. In exchange, we’ll pay your mortgage every month for as long as your house remains painted,” the firm’s website reads.

The transformation from a more traditional color to broccoli green and sunrise orange definitely draws attention, and that’s exactly the point. Brainiacs From Mars is using the homes as a way to advertise its ingenuity.

“This is our business card and it works a lot better than that,” Brainiacs From Mars CEO Romeo Mendoza told ABC News. “It’s telling people we are an out-of-the-box, high-impact firm....The average person gets bombarded with 35,000 ads a week, so it’s hard to really stand out.”

The firm has only painted one house and says its goal is to paint 100 homes by the end of the year. It will have a lot of options to choose from after receiving more than 38,000 applications.

Click here to submit an application for your house.

“It’s definitely a two-way street,” Mendoza said. “We are able to help the homeowners and the homeowners are able to help us.”

According to Mendoza, the houses will be chosen based on “what feels right,” and while there are a lot of factors, he stresses the one thing that does not matter is location.

“It’s based on everything but location. The location makes absolutely no difference to us,” he said. “This home gets attention and does its job no matter where it is. And because it does that we are able to paint anywhere.”

The campaign has already surpassed the company’s wildest expectations. Because of the publicity from the one home already painted, in Buena Park, Calif., Brainiacs From Mars said it has landed new contracts and more than doubled its original staff of 12.

“It’s done tremendous things for us,” Mendoza said. “Ultimately, we’d like to do as many [homes] as possible. It’s effective for us to reach more clients and help homeowners at the same time.”

Copyright 2012 ABC News Radio


Georgia Couple Pleads With Bank of America in Music Video

Jin Lee/Bloomberg via Getty Images(ATLANTA) -- A frustrated Georgia couple whose closing date for a Bank of America loan has been delayed three times decided to plead their case through song in a homemade music video that quickly caught the bank’s attention.

The couple, Ken and Meredith Williams, has been waiting 79 days to close a loan for a new house. They have been paying fines to the seller for the delays, including $50 a day for the past week.

“Bank of America you’re making me so mad. I want to buy this house, really bad,” Ken Williams sings in the video while playing the guitar. “My credit score is 798. Don’t worry ’cause my payments will never be late.”

Friday is their fourth scheduled closing date and, as of that morning, they had not yet heard from the bank. But it looks like their musical plea was a success. In a statement to ABC News, Bank of America spokeswoman Christina Beyer Toth said the following:

“We apologize for the delay in closing Mr. Williams’ loan. We are on target to close his loan today.  For the inconvenience, we have provided him a credit at closing.”

One of places where Williams sings in the video is in front of a Bank of America in Lawrenceville, while his wife dances around in the background.

Meredith Williams initially had the idea of putting together a timeline of all of the delays and using Twitter to get someone’s attention using Bank of America’s customer service Twitter account, @BofA_help.

“We’re more than qualified. We’re buying a really cheap house and it shouldn’t be really difficult,” Ken Williams told ABC News. “We just felt really powerless like we had no leverage.”

Ken Williams works in marketing and his wife works in development. Both work at large organizations in downtown Atlanta and wanted to move to a smaller house closer to work.

While Meredith Williams was writing the timeline, Ken Williams began writing the song. Meanwhile, their friends were bombarding the Twitter account with messages about the couple. They set up a blog with the timeline, their story and the video.

“We didn’t want to sound unreasonable,” he said. “A lot of people are mad at Bank of America for different reasons and I didn’t want to be another angry voice with profanity, so we thought we’d take a different angle with it.”

The upbeat video is both funny and direct.

“Why can’t a house go fast when a buyer’s got cash, pre-approval and two cats?” he sings. “It takes time, obviously, a month or even two but now we’re looking at three.”

Ken Williams made the video on Saturday and posted it to YouTube on Sunday afternoon. By 10 a.m. on Monday morning, Bank of America called the couple.

“I can certainly tell that a fire has been lit under the people who have been working on our loans,” Ken Williams said. “They’ve become very responsive all of a sudden.”

He said the matter “escalated really fast” and the couple received phone calls from a representative of the bank’s CEO.

Even though Ken Williams has not heard from the bank yet about today’s scheduled closing, he hopes this will be the big day.

“All I want is to have a home, and a front yard for my garden gnome. Bank you’ve got to close this loan!” Williams sings at the end of the song. “We can sign the papers and grab a beer, then you take my money for 30 years. Bank you’ve got to close this loan!”

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Copyright 2011 ABC News Radio


Late Mortgage Payments Rise for First Time Since 2009

Hemera Technologies/Thinkstock(CHICAGO) -- Late mortgage payments are rising in the U.S. for the first time since the depths of the economic downturn.

The latest quarterly survey by the credit reporting firm TransUnion shows that the rate of borrowers who are 60 days or more past due rose to 5.88 percent -- up from 5.82 percent in the second quarter.

The third quarter figure marks the first time the national mortgage delinquency rate has increased since the last three months of 2009.

Despite "recent, relatively more conservative lending policies and the apparent stabilization of both home values and unemployment," Tim Martin, the group vice president of U.S. Housing in TransUnion's financial services business unit, says unexpected events led to this spike.

"[I]n the third quarter, the consumer was hit with several unanticipated shocks, including the U.S. credit rating downgrade, stock price declines, European debt concerns, stubbornly high unemployment, more downward pressure on home values and low consumer confidence.  All of this affects a borrower's net worth and desire, or ability, to continue making house payments -- especially if they are facing negative equity in their homes due to price depreciation," Martin wrote in a statement released Tuesday.

Copyright 2011 ABC News Radio


Mortgage Rates Tumble to Near All-Time Low

Digital Vision/Thinkstock(MCLEAN, Va.) -- In addition to this being a buyer's market because of the continued plunging prices of homes, mortgage rates are near an all-time low.

Freddie Mac's weekly survey says that 30-year fixed-rate home loans are now being offered at 4.15 percent.  Prospective buyers would have to go all the way back to 1950 and 1951 to find a deal like that when long-term fixed-rate mortgages averaged 4.08 percent.

Shorter-term fixed-rate loans have also bottomed out with a 15-year fixed-rate loan now at an average rate of 3.36 percent.

It's possible these rates could sink lower, which might also sink spirits of people who want to buy a house but can't swing it right now because of economic hardships.

Copyright 2011 ABC News Radio


DOJ Investigating Standard & Poor's Ratings of Mortgage Securities

Scott Eells/Bloomberg via Getty Images(WASHINGTON) -- Credit rating agency Standard & Poor's is in possible trouble with the Justice Department about whether its ratings of dozens of mortgage securities were deliberately inaccurate, in turn contributing to the near meltdown of the financial industry in September 2008.

The action comes on the heels of S&P's decision earlier this month to lower the AAA rating of the U.S., which sent Wall Street into a tailspin.  However, the Obama administration's decision to conduct an investigation into S&P's rating of mortgage securities began before the downgrade.

Specifically, the government is looking into reports that S&P business managers overruled the findings of company analysts who wanted to downgrade the ratings of mortgage bonds.

In the years leading up to the collapse of the housing market, S&P and other agencies made huge profits on their high ratings of bundled mortgages, which valued them far more highly than their actual worth.

S&P could be in hot water if the Justice Department determines that its analysts put their company's business concerns ahead of their supposed independent evaluations.  However, criminal charges are unlikely, although a civil suit is possible.

Copyright 2011 ABC News Radio

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