08-13-08

As if the current housing market could not get worse the industry and economy is started to notice a wave for mortgage defaults from 2007 loans that where applied for before much of the mortgage meltdown accorded. This time around we are noticing large defaults from prime mortgages from borrowers with previously good credit ratings. The current defaults are expected to triple before the markets start to normalize which is expected to be another huge hit to the economy and in its wake we are likely to see more bank defaults.

Experts argue that home prices could be on the decline for several more years at this rate before markets reverse course and move into gains. This will naturally cause many more people to be underwater with their mortgage a condition that exists when the balance owed is more then the value of the home. Naturally this will not affect those who have 30 year fixed mortgages and don't plan on moving, however those with a need to sell and move for any number of reasons will find it very difficult to do so in some areas.

Adding to the frustration are government sponsored foreclosure assistance programs that don't really offer any real help to Americans in need. FHAsecure a program that will get you out of a risky adjustable mortgage requires that you have at least 95% equity and have been late only 3 times in the last 12 months. On a equity standpoint this has already disqualified most homeowners in need of help. The new foreclosure bill that was just passed calls for the creation of a new FHA program supposedly called FHA Help Now which would act as a short refinance with the government. Your loan would be reduced to 90% of the current equity in the home and will be rolled in to a 30 year fixed payment. This has huge potential to help Americans in need except for one problem. It is voluntary for the current mortgage holder to let you partake of this program. There is no requirement for them to send anyone into this program. The only hope is this program will be cheaper then a foreclosure. This is not a real solution and we urge everyone to write their representative on congress and express your concerns. It is our civic duty to do so.

Again everyone is urged not to wait for any programs or policies to become active. Take action now to save your homes.

Write your Senator here:
http://www.senate.gov/general/contact_information/senators_cfm.cfm

Write your Representative here:
https://forms.house.gov/wyr/welcome.shtml