Gov’t to target 4.5% for mortgages

[HLS]

IF the 4.50% rate actually happens, the restrictions and fees may be obscene, and not everyone will qualify.

I doubt it’s going to be a no cost loan.
For those that qualify, the rate is 4.99% RIGHT NOW.

If you don’t qualify, the rate doesn’t matter.

The govt doesn’t care about Southern California, they are trying to save the country.

Plenty of people in trouble have mortgages for less than $200K.

On a $200K loan the difference between 4.5% and 5% is $60 a month. On $300K it’s $90 a month.
Is this going to save the world ??

People with $100K loans are losing houses too.

It may not apply to refi’s, just purchases.

Eventually rates will go much, much higher.

Today’s rates are a gift, but ppl want to think that they will qualify if rates go lower. HLS

[34f3f3f]

[quote=Rustico]

The government is trying to create a softer landing. That in itself is not cause for celebration.Probably the opposite is true. It is way too early to know where things go from here. Debt,on depreciating assets, even at 4.5% could equal poverty. I don’t think “cash is king goes out the window yet” and leveraged upscale private residences are very risky still.That said it probably will grease the wheels for Realtors.
[/quote]

About sums it up.

[34f3f3f]

[quote=Rustico]

The government is trying to create a softer landing. That in itself is not cause for celebration.Probably the opposite is true. It is way too early to know where things go from here. Debt,on depreciating assets, even at 4.5% could equal poverty. I don’t think “cash is king goes out the window yet” and leveraged upscale private residences are very risky still.That said it probably will grease the wheels for Realtors.
[/quote]

About sums it up.

[34f3f3f]

[quote=Rustico]

The government is trying to create a softer landing. That in itself is not cause for celebration.Probably the opposite is true. It is way too early to know where things go from here. Debt,on depreciating assets, even at 4.5% could equal poverty. I don’t think “cash is king goes out the window yet” and leveraged upscale private residences are very risky still.That said it probably will grease the wheels for Realtors.
[/quote]

About sums it up.

[34f3f3f]

[quote=Rustico]

The government is trying to create a softer landing. That in itself is not cause for celebration.Probably the opposite is true. It is way too early to know where things go from here. Debt,on depreciating assets, even at 4.5% could equal poverty. I don’t think “cash is king goes out the window yet” and leveraged upscale private residences are very risky still.That said it probably will grease the wheels for Realtors.
[/quote]

About sums it up.

[34f3f3f]

[quote=Rustico]

The government is trying to create a softer landing. That in itself is not cause for celebration.Probably the opposite is true. It is way too early to know where things go from here. Debt,on depreciating assets, even at 4.5% could equal poverty. I don’t think “cash is king goes out the window yet” and leveraged upscale private residences are very risky still.That said it probably will grease the wheels for Realtors.
[/quote]

About sums it up.

[jpinpb]

If they do a 4.5% loan for 30 yrs, are they offering it to those already in homes?

One other thing that’s bugging me. Any loan mods that include principle reduction, there should be some way to indicate the “new” value of the house. It should be a new comp.

If they bought for 700k and the bank is cutting them a break and now they’re reworking the loan and making it 600k or 500k, they’ve lost however much value. Other houses in the neighborhood will be looking at sales and see that it sold for 700k, but the reality is that the bank has, in effect, declared it is worth much less.

If they do these loan mods, what effect will it have on comps? How can you determine the real value? Do you have to go to county and check on everyone’s loans and see who reworked it? That’s going to be burdensome.

What a mess.

[jpinpb]

If they do a 4.5% loan for 30 yrs, are they offering it to those already in homes?

One other thing that’s bugging me. Any loan mods that include principle reduction, there should be some way to indicate the “new” value of the house. It should be a new comp.

If they bought for 700k and the bank is cutting them a break and now they’re reworking the loan and making it 600k or 500k, they’ve lost however much value. Other houses in the neighborhood will be looking at sales and see that it sold for 700k, but the reality is that the bank has, in effect, declared it is worth much less.

If they do these loan mods, what effect will it have on comps? How can you determine the real value? Do you have to go to county and check on everyone’s loans and see who reworked it? That’s going to be burdensome.

What a mess.

[jpinpb]

If they do a 4.5% loan for 30 yrs, are they offering it to those already in homes?

One other thing that’s bugging me. Any loan mods that include principle reduction, there should be some way to indicate the “new” value of the house. It should be a new comp.

If they bought for 700k and the bank is cutting them a break and now they’re reworking the loan and making it 600k or 500k, they’ve lost however much value. Other houses in the neighborhood will be looking at sales and see that it sold for 700k, but the reality is that the bank has, in effect, declared it is worth much less.

If they do these loan mods, what effect will it have on comps? How can you determine the real value? Do you have to go to county and check on everyone’s loans and see who reworked it? That’s going to be burdensome.

What a mess.

[jpinpb]

If they do a 4.5% loan for 30 yrs, are they offering it to those already in homes?

One other thing that’s bugging me. Any loan mods that include principle reduction, there should be some way to indicate the “new” value of the house. It should be a new comp.

If they bought for 700k and the bank is cutting them a break and now they’re reworking the loan and making it 600k or 500k, they’ve lost however much value. Other houses in the neighborhood will be looking at sales and see that it sold for 700k, but the reality is that the bank has, in effect, declared it is worth much less.

If they do these loan mods, what effect will it have on comps? How can you determine the real value? Do you have to go to county and check on everyone’s loans and see who reworked it? That’s going to be burdensome.

What a mess.

[jpinpb]

If they do a 4.5% loan for 30 yrs, are they offering it to those already in homes?

One other thing that’s bugging me. Any loan mods that include principle reduction, there should be some way to indicate the “new” value of the house. It should be a new comp.

If they bought for 700k and the bank is cutting them a break and now they’re reworking the loan and making it 600k or 500k, they’ve lost however much value. Other houses in the neighborhood will be looking at sales and see that it sold for 700k, but the reality is that the bank has, in effect, declared it is worth much less.

If they do these loan mods, what effect will it have on comps? How can you determine the real value? Do you have to go to county and check on everyone’s loans and see who reworked it? That’s going to be burdensome.

What a mess.

[NotCranky]

JP,
You get the comps from the market sales JP. Bugs could answer this better than I, but I doubt loan modifications are going to be used for deciding any purchase or refinance comps . Under normal conditions we wouldn’t use them for a listing or a suggestion of what a buyer might offer.

I would still hope that loan modifications “comps” are higher than arm’s length transactions. Transparency would help with that one. I might be disappointed on that on though.

I have been wondering about the recordation, or lack of, for loan modifications, especially with any debt reduction. Not from a point of understanding the value of comps but from this transparency angle. I am sure some people would like to know, for instance, if the land lord gets a loan modification with debt reduction, when it is supposed to be for owner occupied. I am sure some people would like to blow the whistle on that.

So far I haven’t gone to the trouble to research this.In casual searching of property histories I have not seen evidence of debt reduction modifications, or any modifications for that matter. I haven’t been in the investigative mindset regarding this topic so I may have missed something. Next time I log into the MLS I’ll see if there are any clues in the tax research area of Tempo. Has anyone else seen it? Lazy on the issue,I keep expecting a full discussion to pop up on a housing blog :).

[NotCranky]

JP,
You get the comps from the market sales JP. Bugs could answer this better than I, but I doubt loan modifications are going to be used for deciding any purchase or refinance comps . Under normal conditions we wouldn’t use them for a listing or a suggestion of what a buyer might offer.

I would still hope that loan modifications “comps” are higher than arm’s length transactions. Transparency would help with that one. I might be disappointed on that on though.

I have been wondering about the recordation, or lack of, for loan modifications, especially with any debt reduction. Not from a point of understanding the value of comps but from this transparency angle. I am sure some people would like to know, for instance, if the land lord gets a loan modification with debt reduction, when it is supposed to be for owner occupied. I am sure some people would like to blow the whistle on that.

So far I haven’t gone to the trouble to research this.In casual searching of property histories I have not seen evidence of debt reduction modifications, or any modifications for that matter. I haven’t been in the investigative mindset regarding this topic so I may have missed something. Next time I log into the MLS I’ll see if there are any clues in the tax research area of Tempo. Has anyone else seen it? Lazy on the issue,I keep expecting a full discussion to pop up on a housing blog :).

[NotCranky]

JP,
You get the comps from the market sales JP. Bugs could answer this better than I, but I doubt loan modifications are going to be used for deciding any purchase or refinance comps . Under normal conditions we wouldn’t use them for a listing or a suggestion of what a buyer might offer.

I would still hope that loan modifications “comps” are higher than arm’s length transactions. Transparency would help with that one. I might be disappointed on that on though.

I have been wondering about the recordation, or lack of, for loan modifications, especially with any debt reduction. Not from a point of understanding the value of comps but from this transparency angle. I am sure some people would like to know, for instance, if the land lord gets a loan modification with debt reduction, when it is supposed to be for owner occupied. I am sure some people would like to blow the whistle on that.

So far I haven’t gone to the trouble to research this.In casual searching of property histories I have not seen evidence of debt reduction modifications, or any modifications for that matter. I haven’t been in the investigative mindset regarding this topic so I may have missed something. Next time I log into the MLS I’ll see if there are any clues in the tax research area of Tempo. Has anyone else seen it? Lazy on the issue,I keep expecting a full discussion to pop up on a housing blog :).

[NotCranky]

JP,
You get the comps from the market sales JP. Bugs could answer this better than I, but I doubt loan modifications are going to be used for deciding any purchase or refinance comps . Under normal conditions we wouldn’t use them for a listing or a suggestion of what a buyer might offer.

I would still hope that loan modifications “comps” are higher than arm’s length transactions. Transparency would help with that one. I might be disappointed on that on though.

I have been wondering about the recordation, or lack of, for loan modifications, especially with any debt reduction. Not from a point of understanding the value of comps but from this transparency angle. I am sure some people would like to know, for instance, if the land lord gets a loan modification with debt reduction, when it is supposed to be for owner occupied. I am sure some people would like to blow the whistle on that.

So far I haven’t gone to the trouble to research this.In casual searching of property histories I have not seen evidence of debt reduction modifications, or any modifications for that matter. I haven’t been in the investigative mindset regarding this topic so I may have missed something. Next time I log into the MLS I’ll see if there are any clues in the tax research area of Tempo. Has anyone else seen it? Lazy on the issue,I keep expecting a full discussion to pop up on a housing blog :).

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