Fannie Mae, banks halt foreclosures
for the holidays
@CNNMoney December 1, 2011: 4:11 PM ETNEW YORK (CNNMoney) -- Happy holidays struggling homeowners! Fannie Mae, Freddie Mac and several large mortgage lenders have pledged not to foreclose on delinquent borrowers during the Christmas season. For homeowners with loans through Fannie Mae ( , Fortune 500) and Freddie Mac ( , Fortune 500), the moratorium will run from Dec. 19 to Jan. 2. During this time, legal and administrative proceedings for evictions may continue, but families will be allowed to stay in their homes, Fannie said in a statement. "No family should have to give up their home during this holiday season," said Terry Edwards, an executive vice president for Fannie Mae. Among some of the major banks that offer mortgage loans, Chase ( , Fortune 500) Mortgage said it will not evict anyone between Dec. 22 and Jan. 2. Wells Fargo ( , Fortune 500) will also suspend evictions during that period, but will not shut down its eviction machinery entirely.
The bank said it will observe the moratorium on foreclosed properties in its own portfolio but for loans it services for other lenders "foreclosure-related actions may still occur."
Bank of America ( , Fortune 500) said that it would "avoid foreclosure sales or displacement of homeowners or tenants around the Thanksgiving and Christmas holidays."
A holiday halt on foreclosures by the major mortgage lenders could affect tens of thousands of homeowners. An average of 89,000 foreclosure auctions a month have been scheduled this year, according to RealtyTrac. Once a home has gone through that process, eviction is the next step.
For the overwhelming majority of borrowers in default, however, "[i]t's a temporary reprieve, a symbolic gesture to help people out during the holidays," said Blomquist. Then, come the New Year, everyone gets back to business, including mortgage lenders.
4 steps to buy again after foreclosure
Mood of the MarketBy Tara-Nicholle Nelson, Tuesday, November 29, 2011.
Frequently, I receive letters from someone who hasn't yet lost their home to foreclosure but anticipates they soon will, and wants to be able to get back into the market, quick-like.
Many claim their haste is because they don't want to miss out on today's bargain housing prices or interest rates. Yet neither seems poised to rise significantly any time soon.
In the same breath, many of these folks say they're ready to pay top dollar for their next home, and pay an additional premium if they are forced to rely on lease-to-own, seller financing, or a hard-money mortgage.
My advice is almost always this: Slow down! Most legitimate loan programs now impose a three-year-plus waiting period after a borrower loses a home to foreclosure, even if they would otherwise qualify for a mortgage based on their credit score, income and assets.
Here are my four suggestions for how you can wisely use that waiting period to recover from a foreclosure -- these steps also do double duty in terms of setting you up for success and sustainability the next time you buy a home.
What I know is that getting through this grief is an essential first step to truly moving forward. Inherent in grief is an acknowledgement that something is dead and over. The acceptance of that finality is what allows you to move forward and learn the lessons that such experiences can teach.
As long as you're stuck in the emotional protestations of how unfair it was that you lost your home, or spinning in a place of outrage about the Wall Street bailouts, you're probably not making emotional progress to the point where you can begin to learn from your experience.
Individuals and couples should take time out to acknowledge what has happened, and distill and discuss mistakes that were made and insights you've gained so that you can avoid repeating them in the future. It's a meaningful method for progressing past grief and repositioning yourself to make smarter decisions about your money and your mortgage for the rest of your life.
Trying to replace our losses on the rebound, be it after a breakup or after a foreclosure, is how people end up repeating their mistakes. Making new, unsustainable mortgage commitments and chronically overspending or over borrowing is no different from your friend who keeps repeating the same old dysfunctional relationship patterns, year after year.
Tara-Nicholle Nelson is author of "The Savvy Woman's Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com. Ask her a real estate question online or visit her website, www.rethinkrealestate.com.
Stronger Lure for Prospective Home Buyers
Owning Continues to Become More Affordable Relative to Renting, but Several Obstacles Prevent Many From Biting
Home prices and mortgage rates have fallen so far that the monthly cost of owning a home is more affordable than at any point in the past 15 years and is less expensive than renting in a growing number of cities.
The Wall Street Journal's third-quarter survey of housing-market conditions in 28 of the nation's largest metropolitan areas found that home values declined in all but five markets compared with the second quarter, according to data from Zillow Inc.
Meanwhile, rent levels have risen briskly across the country and mortgage rates, hovering around 4%, are the lowest in six decades.As a result, monthly mortgage payments on the median priced home—including taxes and insurance—are lower than the average rent levels in 12 metro areas, according to data compiled for The Wall Street Journal by Marcus & Millichap, a real-estate brokerage that tracked 27 metro areas. It remains less expensive to rent than to buy in 15 cities. But affordability hasn't done much to lift the sagging housing sector because many would-be buyers are unwilling to purchase a home or unable to qualify for a mortgage.
"It's one of the most striking developments of the housing downturn," said Paul Dales, an economist at Capital Economics. "The initial building blocks for a recovery are in place, but the legacy of the recession is really preventing households from taking advantage."In Atlanta, which had the most favorable values for owning versus renting, the monthly payment on the average home was $539 assuming a 20% down payment during the third quarter. By contrast, the average asking rent stood at $840, according to the Marcus & Millichap data.But real estate agents and economists say the trend hasn't boosted demand. That is because affordability alone hasn't been enough to overcome the obstacles in the way of a housing recovery. Some homeowners who would like to move up to larger properties are stuck because they can't sell their homes.