| Mortgage Loan Bill |
| By Credit Federal |
Published
08/1/2008
|
Home Loan
|
|
|
|
|
Bill to Aid Financial Mortgage Industry and Homeowners
President Bush signed into law a package of housing legislation that included broad authority for the Treasury Department to safeguard the nation's two largest mortgage finance companies; Fannie Mae and Freddie Mac, and a plan to help troubled borrowers avoid foreclosures.
The law authorizes the Federal Treasury Department to rescue mortgage finance giants Fannie Mae and Freddie Mac, should they verge on collapse. Combined, the two companies own or guarantee nearly half of the nation's $12 trillion in mortgage loans.
"We look forward to put in place new authorities to improve confidence and stability in markets, and to provide better oversight for Fannie Mae and Freddie Mac," Mr. Fratto said. "The Federal Housing Administration will begin to implement new policies intended to keep more deserving American families in their homes."
The new housing law includes a plan aimed at helping as many as 400,000 homeowners pay off their troubled mortgage loans and replace them with more affordable, government-insured loans. The program is voluntary and the lenders must agree to take a sizable loss, reducing the principal of each loan, before they can be refinanced.
The bill includes an array of other aid for troubled borrowers, and about $15 billion in housing-related tax breaks. It also includes nearly $4 billion grants to local governments to buy and refurbished foreclosed properties, which Mr. Bush had opposed even as he signed the measure. The White House views that provision as a giveaway to banks and other lenders who own the seized properties.
Get multiple free lender quotes for a 2nd mortgage refinance loan or an equity loan to pay bills, to remodel or any reason.
Not a homeowner? Apply for a new home loan, but first review our free home buying tips below:
1) Make sure that you can handle the payments. Your entire mortgage payment should be no more than 25-28% of your gross income. Your total monthly debt payments; including your mortgage, should not exceed about 33% of your gross income.
2) Make sure you get a good mortgage. If you are financing with an ARM (adjustable rate mortgage) you really should not be buying the home. Your interest rate will go up and increase your payments, and then you may find it difficult to make the payments. Your equity may not grow quickly enough to allow you to refinance before your rate changes kick in. If you are financing with an 80/20 you need to work to pay off the 20 as quickly as possible.
3) Make sure you will be able to live in the home at least 3 to 5 years, so you can; at a minimum, break even on the mortgage.
4) Make sure the home has passed all inspections. Invest the money to pay for the inspection to help you avoid costly mistakes. If you are planning on remodeling, you need to add this into your budget as well.
5) Make sure you can handle emergencies and maintenance. Whether by wear and tear or by events such as lightning or wind, you can expect emergency repairs and routine maintenance. If you cannot start an emergency maintenance/repair fund while purchasing the home, save the money before you buy.
|
Email this article to a friend - click here
Webmasters: Free Credit Content for Your Website!
Multiple ways to use our financial content:
*) You can use our RSS Feeds for automatic insertion and updates
*) You can simply link to this article
