“The program, called (drumroll please) the Distressed Asset Stabilization Program,” Loud crashing cymbals!
This is the song that never…. Oh wait, I did that about yesterdays new government program.
“the expanded program, which requires that buyers agree not to resell for three years at least half of the homes they buy.”
Let`s see 5000 x 3 = 15,000 divided 2 = 7,500 + 6,500 former deadbeat homeloaners turned rent-to-loan deadbeat victims and their sob stories about why they can`t pay rent x 3 years = 4,000 bulldozed hoods in the year 2017 + interest. Right?
Tampa targeted in expanded federal sale of defaulted loans
by Kim Miller
The Federal Housing Administration announced this morning that investors can start applying to purchase distressed home loans with concentrations of properties in Tampa, Phoenix, Chicago and Newark, N.J.
Beginning in September, defaulted loans insured by the FHA will be sold in discounted pools to private investors, who have more flexibility in negotiating lower mortgage payments, reducing loan amounts, or offering other options such as rent-to-own deals.
The program, called the Distressed Asset Stabilization Program, was announced last month and was originally expected to target about 5,000 loans nationwide. This morning, Acting FHA Commissioner Carol Galante said that has increased to 9,000 loans.
“Given the strong interest in this program and the shadow inventory, we are actually talking now close to 9,000 loans,” she said. “At its most basic level, this program creates the opportunity for everyone to come out a winner.”
Florida has about 366,650 loans insured by the FHA, according to a first-quarter report from the Mortgage Bankers Association. Of those, 15 percent — about 55,000 — are in foreclosure or 90 days or more late on payments.
Nationwide, FHA insures about 6.7 million loans, 9 percent of which are in foreclosure or seriously delinquent.
About 5,000 defaulted mortgages are expected to be sold every quarter under the expanded program, which requires that buyers agree not to resell for three years at least half of the homes they buy.
For more informaiton on the program, go to http://www.hud.gov/fhaloansales.
Under the program, loans are sold competitively at a market-determined price generally below the outstanding principal balance. FHA then processes an insurance claim, removes the FHA insurance and transfers the loan to the investor. Once the note is purchased, foreclosure is delayed for a minimum of six additional months, giving the new servicer time to work through alternatives with the borrower, possibly finding an affordable solution to allow the borrower to remain in their home.
Because the loans are generally sold for less than what the borrower currently owes, the purchaser has the ability to reduce or modify the loan terms while still making a return on the initial investment.
If no viable alternatives exist, the purchaser may be able to help the borrower sell the property through a short sale and avoid the costs of foreclosure.
This entry was posted on Wednesday, July 18th, 2012 at 8:53 am and is filed under Banking, Foreclosures, Housing affordability, Mortgages, Real estate bust. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
No comments:
Post a Comment