Housing Market Tracker - Subprime and Mortgage Review

Here's our summary of articles and data points on the housing market. It's part of Seeking Alpha's coverage of the real estate market and homebuilder stocks. Like all other topics and stock coverage from Seeking Alpha, you can have this sent to your Blackberry or desktop email by signing up for our no-spam free email subscription service.

Quote of the Day

"Interesting presentation. God, I hope you're wrong." – A NY investment firm's chief risk officer said to J. Kyle Bass, a hedge fund manager from Dallas, in August 2006. Bass made a presentation to that CRO's investment firm, drawing a scenario that the housing market would crash Bass offered to set up a hedge fund betting against the housing market. (Seattle PI, Dec. 26th)

Subprime Fallout

* Credit Crunch Amplifies Housing Downturn (Inman News, Dec. 27th): "Private mortgage insurers PMI Group Inc. (PMI) and MGIC Investment Corp. (MTG) have raised or are raising rates for borrowers with lower credit scores and loan-to-value ratios above 95%. Both companies have discontinued mortgage insurance on loans with LTVs above 95% for borrowers with credit scores below 620... MGIC will no longer insure reduced-documentation loans for investment properties or cash-out refinances... Government-sponsored lenders Fannie Mae (FNM) and Freddie Mac (FRE) [announced] new surcharges on most [new] loans... for borrowers with credit scores below 680... Lenders must also be able to provide documentation supporting an assessment that the property is not located in a declining market."

* Online Resources Survey Shows Credit Concerns Not Limited to Mortgages (Fox Business, Dec. 26th): "Online Resources Corporation (ORCC), a leading provider of web-based financial services, today released the results of a survey of U.S. households and billers regarding the effect of the current mortgage crisis on bill payment and collection patterns... The survey of more than 1,000 nationally representative U.S. households finds that Americans are increasingly being forced to prioritize among their bills by creating a "delinquency budget" to determine which bills get paid. While the mortgage bill tends to be the one that households are most likely to pay, businesses across other industries are facing a decreasing share of that delinquency budget."

* Miller Offers Best Way Out Of Mortgage Mess (News Record, Dec. 26th): "In November, the House of Representatives passed a bill to curtail predatory lending that Miller, as well as Reps. Mel Watt and Barney Frank, had sponsored. It would require lenders to provide documentation that applicants can afford the loans they get. It also prohibits prepayment penalties and bans paying bonuses to mortgage brokers for steering people to higher-interest loans when they qualify for ones at lower rates. The bill was modeled after North Carolina law, which is one reason why the subprime crisis hasn’t hit this state as hard as others."

* Mortgage Woes Hurt H&R Block (News Leader, Dec. 26th): "H&R Block's (HRB) plan to sell Option One to Cerberus Capital Management LP, announced in April, fell through by December... HRB said it would shutter most of Option One... The turmoil cost Chairman and CEO Mark Ernst his job... NovaStar Financial Inc. (NFI), also a subprime lender, watched its stock price drop from $105 in January to, at one point, less than $2. Continued losses forced the company to give up its REIT status, incurring large tax payments and leading the NYSE to move to delist NovaStar... Three of NovaStar's top executives will step down early next year: Chairman and CEO Scott Hartman, CFO Gregory Metz and General Counsel Jeff Ayers"

* Making A Profit On The Crashing Market (Seattle PI, Dec. 26th): "J. Kyle Bass conceived a hedge fund that bet on a crash for residential real estate by trading subprime mortgage securities... Bass and investors like him saw opportunity in a range of new investment tools that banks created to sell subprime securities worldwide. These included mortgage bond derivatives, contracts whose values are derived from packages of home loans and are used to hedge risk or for speculation. The vehicles allowed hedge funds such as Bass' to bet against particular pools of mortgages. The new subprime derivatives, which amplified the risks of the underlying mortgages, were sold to banks and institutional investors."

* Indian Mortgage Glass Half-Empty In 2007 (Indian Country, Dec. 26th): "Government numbers released in August [show] the total dollar volume of loans made to Indians and the number of lenders willing to extend credit to Native people fell for 2006, with Indians in danger of being lapped by loans to the much smaller Native Hawaiian contingent... The subprime mortgage crisis shuttered several of the top lenders to Indians, cutting off credit access [although] some of these subprime lenders were accused of predatory lending practices toward Natives. The closure of GreenPoint Mortgage, also shuttered TribalPOINT, an active private-firm mortgage [program which] extended private mortgages to Indians under the HUD-184, Rural Housing Services programs [and] through private mortgages."

* Weekly Guru Bargains Highlights: Ambac Financial Group Inc. (Guru Focus, Dec. 26th): "Analysts predict that Bond insurer Ambac Financial Group, Inc. (ABK) is currently undervalued... Legislation to freeze ARM mortgages [is] good news for bond insurers... Insider buys were made between $25.25-$41.85 as of November: Chairman, President and CEO, Director Robert J. Genader and Senior Managing Director Kathleen A. Mcdonough bought 10,000 shares each, Executive VP John W. Uhlein bought 7,500 shares, Director Thomas C. Theobald bought 4,000 shares, Director Michael A. Callen bought 3,000 shares, Senior Managing Director David W. Wallis bought 2,500 shares, Director Henry D. G. Wallace bought 2,250, and Senior Managing Director Thomas J. Gandolfo bought 1,000 shares."

* Zacks Lowers MGIC Shares To 'Sell' (Milwaukee Journal Sentinel, Dec. 26th): "Zacks Equity Research: The rating on shares of MGIC Investment Corp. (MTG) has been lowered to "sell" from "hold". The mortgage insurance company... expects to post losses through the end of 2008... Q3's $372.5 million loss... "came in substantially below our expectations," Zacks analyst Eric Rothmann wrote... MGIC's "performance trends continue to be negatively impacted by issues within the residential mortgage markets, and expect higher delinquency rates and additional losses from foreclosed loans over the near-term... We are expecting expenses from losses incurred to be substantially elevated over the next year." The company has also cut its quarterly dividend by 90% to $0.02.5/share. Rothmann believes the dividend "remains vulnerable."

Mortgage Lenders

* Wells Fargo Yields to AG Regs (Boston Herald, Dec. 27th): "Wells Fargo (WFC) is refusing to reimburse mortgage brokers across Massachusetts... via a controversial payment system that’s been harshly criticized by Attorney General Martha Coakley. WFC, one of the top mortgage lenders in Massachusetts, told brokers...last week that... it will no longer do business with brokers who use a “yield spread premium” to pay themselves... Traditionally, those seeking mortgages are charged flat upfront point fees to process mortgages [which] many lower-income customers can’t afford... So many brokers... use “ysp” that allow those fees to be paid via higher interest rates spread out over the course of a mortgage loan."

* Most U.S. Stocks Decline on Retail Sales, Home Price Concern (Bloomberg, Dec. 26th): "MBIA, the world's biggest bond insurer, gained $1.84, or 9.2%, to $21.96. Davis Selected Advisers LP, a money manager which also plans to take a $1.2 billion stake in Merrill Lynch & Co., said today in a filing with the SEC that it increased its stake in MBIA to 5.1%.Bear Stearns added $0.49 to $89.29. Billionaire investor Joseph Lewis said he raised his stake in Bear Stearns for the second time this month after the fifth-biggest U.S. securities firm's stock fell 11% in December. Lewis now holds 9.6% of the company, according to a regulatory filing Wednesday."

* Spaces And Places: Home Builders' Solution For State's Housing Slump (San Jose Mercury News, Dec. 25th): "Joseph Perkins, head of the Northern California Home Builders Association... says he will work in 2008 to raise the so-called "conforming" loan limit from $417,000 to $600,000. That refers to loans eligible to be purchased by either Fannie Mae or Freddie Mac. Perkins: "Housing generates $273 billion in economic output in this state. Our governor has declared a fiscal emergency due to diminished tax receipts because of the housing downturn. It makes sense to jump-start housing again by creating some incentives." Building Industry Association: New-home construction in November sank almost 50% from 2006 to 3,200 houses, and more than 20% from October."

http://seekingalpha.com/article/58491-housing-market-tracker-subprime-and-mortgage-review

Bad Credit Debt Consolidation Mortgage – At Relatively Low Interest Rate

Are you fed up of giving various payments to different creditors. Looking for a program that can bring down your payments by making you debt free within short period? Avail bad credit debt consolidation mortgage.

What is a bad credit debt consolidation mortgage?

A bad credit debt consolidation mortgage is a loan to repay one’s consolidated debt in spite of the bad credit incurred. In other words easing the debt burden off faster is possible through refinancing of the mortgage which means that one pays less interest and swings off the hook by repaying the principal amount.

Comparative shopping for bad credit debt consolidation mortgage loans:

When you undertake debt consolidation loans, having bad credit does not always entail high charges as penalty. Comparative shopping for online consumer debt consolidation loans enables huge savings on these debt consolidation loans which means you have more cash to pay off your debts.

Check out the online quotes offered by consumer debt consolidation agencies. Use a debt consolidation calculator available online to check your stand. Surf the Internet for websites of lenders and brokers. Most websites will display rates of interest lenders are likely to offer but if you are seeking a bad credit debt consolidation mortgage, then, be specific about the quotes.

Financial institutions offer a variety of mortgage loans especially the home equity loans which spell low rates of interest and flexible repayment terms in exchange for collateral like real estate, bonds or shares. A home equity loan is akin to a second mortgage on your asset, the home, and it borrows a portion of or the entire equity though the safeguard is that a line of credit enables one to withdraw the entire equity at a time as and when required.

What to watch for when undertaking a debt consolidation loan:

* Do not jump for the first lender you come across. Check out all options: financial institutions, traditional lenders, private investors and sub prime lenders. The best deals essentially come through from the smaller lenders.

* Know whether the lenders you liaise with are legitimate ones or not. Check out the schemes, questionnaires, costs entailed.

* Know whether the interest rates can be worked on for mutual benefit eventually and whether mortgages can be refinanced once the bad credit has been reasonably eliminated.

* Understand the language the lenders speak and do not sign documents without comprehending them in full.

* Learn to manage your money. Budget your income and expenses every month, avoid credit cards and use cash when making purchases. Keep track of the repayments and make them regularly to avoid penalties and loss of the collateral.


http://www.americanchronicle.com/articles/viewArticle.asp?articleID=47345

A Top Secret Investment Opportunity: Don't Fight the Fed!

How the world has changed! Marty Zweig's 1986 book, Winning on Wall Street, gained a lot of popularity after he famously called the market crash of 1987. One of the most noted Zweig precepts was the following: Don't Fight the Fed!

What has changed?

The Challenge

Fed policy under Bernanke has a new challenge. The seizure in the credit markets has created a situation where the Fed Open Market Committee sees a challenge that has several different dimensions. From their perspective, the problem is not just one of adding liquidity. The Fed is attempting to address two specific additional concerns:

1. The elevated LIBOR rate -- something that affects Adjustable Rate Mortgages, swaps, and many business loans. LIBOR, a rate little understood by equity traders, reflects the interest charged by non-US banks holding dollar deposits. It is elevated because the banks are unsure of the counter party exposure to structured investment vehicles that include mortgage securities. The lack of transparency in other bank's holdings makes short-term lending problematic. Why reach for a little yield, when there is a risk of bank failure? When LIBOR was adopted in many agreements, it reflected a reasonable risk premium to Treasury Bills. That was the usefulness - something better than the prime rate. The agreements did not contemplate a situation like the current one.
2. Banks holding mortgage investments on their balance sheets may have difficulty in using these as collateral for additional lending. This limits their ability to do future lending, an important consideration. The discount window accepts these assets as collateral, but the rate is higher and there is still a stigma attached to this approach.

The Fed Reaction

The Fed chose this week to target the specific problem rather than to cut fed funds by 50 bp's instead of 25 bp's. Was this wise?

As we noted in our reaction to the Fed policy, the proposed auction process, the Term Auction Facility [TAF] is explicitly targeted to the perceived problems. We see the Fed as completely engaged in the process of reducing LIBOR and creating a market for mortgage holdings.

Earth to traders! The concept of not fighting the Fed has a new dimension. Get with it, or lose.

The Fed succeeded only marginally with its effort at expanding borrowing through the discount window. It is trying something else. If it works, they will do more of it. If it does not, they will try something else.

The Market Reaction

We are struggling to recall a reaction to a new policy that was more negative. Partly because of the market decline on the day of the Fed announcement, and partly because of the timing of the new policy initiative, nearly everyone is negative.

Leading market pundits of both bullish and bearish persuasions condemn the Fed. Some are unhappy that the markets were misled. Some think the policy will be ineffective. Traders must remember that each day is a new one. Complaints about the sloppy Fed timing of announcements have little bearing on future prospects.

In his excellent blog, Harvard Economist Greg Mankiw highlights the bad press for the Fed. He notes, as we did last week, the divergence of opinion between professional economists and everyone else.

Our Perspective

When so many people have the same reaction, and we think it is incorrect, it provides an unusual opportunity. Leading critics think that the Fed members are not as intelligent as they are, that they are all academics and therefore out of touch, that they are "behind the curve", that another 25 bp's of fed funds would have made the difference, and that the Fed should include trucking company executives and fund managers (to pick at random two recent comments). More on these criticisms in future articles.

The criticisms often point to the lack of reaction in current LIBOR rates (using many incorrect time periods and many irrelevant expirations), while declaring the Fed's innovative TAF as dead on arrival. Anyone thinking this through should realize that the impact on LIBOR cannot be expected to happen until the auctions take place. We shall see this week.

Conclusion

We acknowledged that the timing of the Fed announcements lacked sensitivity to market reactions. The "false signals" were neither planned nor expected. Those who do not understand government agencies tend to impute motives that were not really there. They think that organizations behave like a unitary actors -- with a clear, rational plan in mind.

The simple explanation is that the Fed is doing multiple things, with various other cooperating agencies, on different schedules with different announcement timetables. One of the advantages for our readers is that we have the only approach (we think) that describes for readers the actual policy-making process.

Could the Fed have done better? Sure. But the process of transparency in policy announcements is new, and still developing. Meanwhile, the question for investors is what to do now. We take the approach that no one is stupid. We look for the best information from all sources.

We do not know whether the TAF will be successful, and neither does the Fed. They are attempting something innovative that might work. If it does, you will soon see many articles in mainstream publications that will get around to explaining what economists and our readers already know. It could be a solid market catalyst, and that is our position going into this week.

For readers with futures accounts, we have bought a few Jan 08 Eurodollar contracts. This is an interest rate instrument based upon LIBOR that should rally if the TAF is successful. For those who do not trade futures, a perceived success in the auctions should also help equities.

A Final Thought



http://seekingalpha.com/article/57373-a-top-secret-investment-opportunity-don-t-fight-the-fed

Bush lets banks write rules for mortgage relief

President George W. Bush and Treasury Secretary Henry Paulson have unveiled their subprime mortgage relief plan, which they call the “New Hope Alliance.” The corporate media coverage of Bush’s Dec. 6 announcement was massive. Sadly, the number of families whom this plan will help is miniscule.

Subprime mortgage loans are characterized by interest rates that start at 1 percent to 2 percent but soon “reset” to much higher rates. The Bush administration claims its plan will help families avoid foreclosure by freezing interest rates on some subprime loans for the next five years.

The administration has attempted to portray its mortgage relief plan as a lifeline for at-risk borrowers. But the plan is more akin to a wish list for the very same banks and mortgage lenders whose insatiable greed helped create the currently unfolding economic crisis.

The Bush-Paulson plan includes a maze of eligibility requirements that are designed to disqualify all but a handful of the more than 2 million households facing foreclosure. Housing advocacy groups estimate that less than 2 percent of subprime borrowers nationwide would qualify for a rate freeze under the administration’s plan. And it provides no help for the growing number of renters across the country who have been left homeless since their landlords entered foreclosure due to a subprime loan.

The Bush administration has ensured, however, that the plan is agreeable to mortgage lenders and Wall Street banks by making lender participation in the relief plan completely voluntary. In other words, the banks and mortgage lenders don’t have to freeze interest rates if they don’t want to. They are likely to do so only if they decide that the housing market is so glutted that going the foreclosure route could leave them stuck with property that can’t be sold.

This hollow “relief” plan stands in stark contrast to the hundreds of billions of dollars in bailout money that the Federal Reserve has handed the Wall Street banks and investment funds over the past few months.

These bailout funds have come in the form of massive liquidity infusions and central bank purchases of collateralized debt obligations. CDOs are asset-backed securities that are tied to mortgage loans. Banks such as Citigroup and Bank of America hold this now-worthless paper in massive quantities. The Federal Reserve has been attempting to bail the major banks out of their crisis by essentially taking the worthless paper off the banks’ balance sheets.

Working-class households are entering into foreclosure and bankruptcy at levels not seen since the Great Depression, yet it is the rich capitalist investors and bankers who are given hundreds of billions of dollars in rescue funds.

Across the country, once-vibrant working-class communities have turned into near ghost towns as “For Sale” signs and boarded-up windows have become ubiquitous. Workers are also suffering under the weight of rising food and energy costs at the same time that the economic downturn is intensifying the bosses’ drive to slash wages and cut jobs. Yet the only relief plan the president can conjure up is to tell workers to “hope” that banks will voluntarily freeze interest rates on some mortgages.

Recent polls suggest that the economy is fast becoming the number one issue on the minds of potential voters in the 2008 election. Eager to garner votes, the Democrats have also been outlining proposals for mortgage relief. It’s part of a debate within the ruling class over how to smooth over some of the massive fallout from the currently unfolding crisis.

“Relief” for the working class will not come through the empty proposals of ruling-class politicians. It takes the organized resistance of the multinational working class against the banks and swindlers on Wall Street who are robbing workers of their homes. Democrats and Republicans can debate back and forth endlessly over their mortgage plans, with little consequence. But millions of workers in the streets demanding a moratorium on foreclosures, layoffs and wage cuts would create the potential for truly lasting relief.

---

Articles copyright 1995-2007 Workers World. Verbatim copying and distribution of this entire article is permitted in any medium without royalty provided this notice is preserved.

http://www.workers.org/2007/us/mortgages-1220/

AM, Sun 16th Dec - UK house prices: Spin on this

The worrying factor here is that consumer confidence and sentiment dictates house prices. After-all, if we decide to lower our values, house prices will fall...
Posted: 10:04 am, 16th December 2007

UK house prices have risen according to Government figures. And, as the DCLG index uses data from the land registry, it would seem the opinionated 'gloomers' writing articles for media these days have got it all wrong. Again!

I was looking back at some house price forecasts from the so called 'experts' over the past 5 years. Our hastiness to fall for the spin that is spun by freelance editors listening to these predictions is worrying to say the least.

Most experts are actually still predicting a positive outlook for house prices in 2008. Knight Frank believe house prices will rise 10% in prime London while the Council of Mortgage Lenders (CML) predict a 2-3% rise. Lombard, Nationwide, HSBC, Hometrack and Savills all predict 0-5% growth during 2008. In fact, the only notable gloomers are HousePriceCrash.co.uk and FirstRung.co.uk - hardly suprising considering their alliance.

We will brush past the rediculous 35% fall for 2008 predicted by HousePriceCrash.co.uk and focus on the much publicised fall predicted by the well respected Capital Economics, one of the leading economic research consultancies in the UK and founded by Roger Bootle who is one of the City of London’s best known economists, having worked in or around the financial markets since 1978.

As many people are placing a good deal of their faith on such organisations, I thought it pertinent to highlight some cracks.

Capital Economics predicted that house prices were going to fall by some staggering 20% from January 2005 through to January 2007. Clearly, Mr Bootle has a bad opinion of our own property market. And, it would seem, a knack for getting things glaringly wrong. House prices actually rose by some 22% over this period making the Capital Economic prediction a massive 42% wide of the mark.

FirstRung.co.uk and HousePriceCrash.co.uk are new additions to the prediction pile - mainly because they are trying to make up the numbers in the notable absence of past public prophets.

It would seem predicting house prices is an impossible task. Those that do stick their necks out usually get it wrong and those that don't just sit back and laugh at the endless spin.

I read an article on FirstRung.co.uk that had the headline "UK house prices crash 1.1%". A little desperate I am sure you will agree. Aside from the fact that house prices haven't crashed, such a minute 'fall' certainly doesn't justify such a ludicrous spin. Strangely, this actually filled me with some confidence. If such websites are declaring a crash at a time when a crash is not even close it surely shows that they have decided to clutch at as many straws as they can!

The worrying factor here is that consumer confidence and sentiment dictates house prices. After-all, if we decide to lower our values out of fear of a falling market, house prices will innevitably fall. This is actually the main problem, not the housing market or house prices themsleves.

With RightMove reporting a drop in prices, it would seem that this theory is correct. Asking prices have fallen because the press are spinning yarns fuelled by wild predictions from historically innacurate forecasters influenced by largely unreliable data.

If we ignore the spin and focus on the actual prices of property sold we will surely not go far wrong. For the most accuarate index look to the DCLG data. They showed house prices rising 0.5% in November following a rise of 0.7% in October.

Strange then how so many other less reliable indices are showing house prices falling!? It would seem innacurate information is available in abundance.

A friend once said to me - "54.9% of statistics are made up on the spot".

The worrying factor here is that consumer confidence and sentiment dictates house prices. After-all, if we decide to lower our values, house prices will fall...
Posted: 10:04 am, 16th December 2007

UK house prices have risen according to Government figures. And, as the DCLG index uses data from the land registry, it would seem the opinionated 'gloomers' writing articles for media these days have got it all wrong. Again!

I was looking back at some house price forecasts from the so called 'experts' over the past 5 years. Our hastiness to fall for the spin that is spun by freelance editors listening to these predictions is worrying to say the least.

Most experts are actually still predicting a positive outlook for house prices in 2008. Knight Frank believe house prices will rise 10% in prime London while the Council of Mortgage Lenders (CML) predict a 2-3% rise. Lombard, Nationwide, HSBC, Hometrack and Savills all predict 0-5% growth during 2008. In fact, the only notable gloomers are HousePriceCrash.co.uk and FirstRung.co.uk - hardly suprising considering their alliance.

We will brush past the rediculous 35% fall for 2008 predicted by HousePriceCrash.co.uk and focus on the much publicised fall predicted by the well respected Capital Economics, one of the leading economic research consultancies in the UK and founded by Roger Bootle who is one of the City of London’s best known economists, having worked in or around the financial markets since 1978.

As many people are placing a good deal of their faith on such organisations, I thought it pertinent to highlight some cracks.

Capital Economics predicted that house prices were going to fall by some staggering 20% from January 2005 through to January 2007. Clearly, Mr Bootle has a bad opinion of our own property market. And, it would seem, a knack for getting things glaringly wrong. House prices actually rose by some 22% over this period making the Capital Economic prediction a massive 42% wide of the mark.

FirstRung.co.uk and HousePriceCrash.co.uk are new additions to the prediction pile - mainly because they are trying to make up the numbers in the notable absence of past public prophets.

It would seem predicting house prices is an impossible task. Those that do stick their necks out usually get it wrong and those that don't just sit back and laugh at the endless spin.

I read an article on FirstRung.co.uk that had the headline "UK house prices crash 1.1%". A little desperate I am sure you will agree. Aside from the fact that house prices haven't crashed, such a minute 'fall' certainly doesn't justify such a ludicrous spin. Strangely, this actually filled me with some confidence. If such websites are declaring a crash at a time when a crash is not even close it surely shows that they have decided to clutch at as many straws as they can!

The worrying factor here is that consumer confidence and sentiment dictates house prices. After-all, if we decide to lower our values out of fear of a falling market, house prices will innevitably fall. This is actually the main problem, not the housing market or house prices themsleves.

With RightMove reporting a drop in prices, it would seem that this theory is correct. Asking prices have fallen because the press are spinning yarns fuelled by wild predictions from historically innacurate forecasters influenced by largely unreliable data.

If we ignore the spin and focus on the actual prices of property sold we will surely not go far wrong. For the most accuarate index look to the DCLG data. They showed house prices rising 0.5% in November following a rise of 0.7% in October.

Strange then how so many other less reliable indices are showing house prices falling!? It would seem innacurate information is available in abundance.

A friend once said to me - "54.9% of statistics are made up on the spot".

Vote in Congress backs law to help subprime victims

The US Senate passed a bill yesterday that could help an estimated 200,000 homeowners avoid foreclosure, bringing lawmakers a step nearer to enacting legislation addressing the subprime mortgage crisis after weeks of deadlock.

The Senate bill raises the limit on the number of loans available through the Federal Housing Administration by allowing the federal agency that insures mortgage loans to halve the required downpayment for an FHA loan. It also increases the maximum allowable loan to $417,000.

The legislation passed on a 93-1 vote days after Harry Reid, the Senate majority leader, called on President George W. Bush to intervene in a long-running standoff with Republican lawmakers over the housing legislation.

The White House urged Congress to pass FHA reform when it unveiled its own industry-backed plan to address the housing meltdown. But the bill was stalled for weeks because of objections from Tom Coburn, a Republican senator. Hr said the FHA bill would create more liability for the government by leading to more, not fewer, risky loans.

Chuck Schumer, a New York Democratic senator, said: "It was past time to approve a proposal like this that can help a good number of Americans save their homes."

The Senate version of the legislation differs from the proposal passed in the House of Representatives, which has higher loan limits and more flexible downpayment standards. A White House spokesman said Mr Bush was pleased the Senate had passed the bill, but that he had "some concerns" with both versions. He is, nevertheless, expected to sign the bill into law once both houses agree on the final legislation.

Democrats feel that White House moves to tackle the mortgage crisis do not go far enough. But until yesterday, the Senate had failed to gather the political consensus needed to pass any legislation to address the housing meltdown.

http://www.ft.com/cms/s/0/cadc0304-aaaf-11dc-a779-0000779fd2ac.html

Mortgage pain starts to hit spending

Half of homeowners whose mortgage rates have risen in the past year have cut back on spending to pay the more expensive loans, according to Bank of England research published today.

The rise in the number of households struggling to pay their debts is small but likely to fuel concerns about the ability of the 1.4m homeowners on fixed rates facing a sharp jump in repayments when their deals expire.

The NMG Research survey of 2,000 people in the Bank's quarterly bulletin found

8 per cent of homeowners with loans reported problems paying for their accommodation, similar to last year, but up on 2005. Almost one-quarter of those coming off cheap fixed-rate deals reported problems and 22 per cent found it difficult to service their new loans.

According to the article by Matt Waldron and Garry Young: "This was appreciably higher than the 5 per cent of mortgagors on continuing fixed-rate deals who reported problems." Of the total number of mortgage-holders, 16 per cent said that they had been on a fixed-rate deal that had expired over the year. Most reported a rise in repayments of £59 a month, or about 12 per cent of their average monthly repayments. The rise in mortgage payments was equivalent to 0.4 per cent of total household disposable income, the research said.

Another 38 per cent of homeowners with a mortgage were on a fixed rate and 23 per cent said their deal would expire within the next year.

About 30 per cent of people with mortgages owe more than £5,000 on top of their mortgage. Six per cent of those with a mortgage reported their unsecured debts were a heavy burden.

The Bank has been monitoring household finances to see whether the number of people getting into financial difficulty is large enough to pose a threat to the economy.

The survey was conducted in September, when the Bank's main rate was 5.75. It cut its main rate to 5.5 per cent this month.

*UK house prices slumped for the second month in a row from November to December, with the annual measure hitting a 21-month low, online estate agent Rightmove said today.

House prices in mid-December were 3.2 per cent lower on the month, the sharpest monthly decline since the series began in January 2002. The largest decline was a 6.8 per cent drop in Greater London followed by a 3.8 per cent slide in south-east England.

http://www.ft.com/cms/s/0/1f09c216-ac42-11dc-82f0-0000779fd2ac.html

Buy to Let Mortgages

Buy to Let Mortgages are mortgages specifically designed for people wanting to invest in the property market by purchasing one or more houses and letting them out to private tenants. They differ from other mortgages as the lender allows the rental revenue to be considered as income when considering the ability of the buyer to meet the mortgage payments.

If you have money to invest in another property and you have made the decision to buy and let then here are a few important things to consider.

Choose the Right Property
One of the key points of consideration is the location of your property. This should take up most of your time, as you will need to investigate many locations before coming up with a short list.

You can cut down on some of the work by consulting letting agents in you areas you are considering as they can give you some priceless information on the supply and demand of rental properties in the area.

As part of your research you should also consider whether there are organisations, public services or Schools/Universities nearby. They could all provide you with a steady supply of tenants.

You should also consult The Association of Residential Letting Agents (ARLA). They can give you contact details of ARLA-registered agents in your area and they will also have information on regulations and rental prices in your area of interest.

Once you have made a decision on what and where to buy you now need to get the right mortgage.

Choosing a Buy to Let Mortgage
As a general rule most lenders in the UK will give you up to 85% of the property value. Of course if you can prove that the rental income could cover a higher mortgage then they may also take this into consideration. However, it's still best to come up with a good deposit. Another rule of thumb is to try and ensure your rental income is 125% of your mortgage payments. This will ensure you not only cover rental costs but also and maintenance expenses too. Remember, the property is a long-term investment so don't think you'll be creating a nice income from the rent minus the mortgage payments.

Costs Involved
You will obviously have done your sums and know how much rental you will receive plus any on-going costs. Also make sure to include any hidden costs such as solicitor fees, insurance, stamp duty, and potential rise in interest rates, which could affect your mortgage.

As a landlord you will also have additional health and safety considerations so you may need to modify the property to adhere to fire regulations etc.

Conclusion
Taking on a buy to let property and mortgage can be a very exciting venture. Get it right and you could start yourself out on the road to building a very nice property portfolio. But get it wrong and you can land yourself into a lot of financial trouble.

But if you follow the basic principles laid down in this article it will give you a good starting point on the key areas to consider before making the move.

Paul Hockney is an online loan expert who provides Debt Consolidation Secured Loan tips and advice.

The Secret is Out About Reverse Mortgages

As predicted, it's another recording breaking year for reverse mortgage volume. Over 90,000 FHA insured reverse mortgages were done in FY 2007 which ended on Sept. 30. This breaks the previous year's number of 76,000 + for fiscal 2006. And compare that to 43,121 loans in FY 2005. These are significant numbers for a loan product that is still considered to be in its infancy, barely a blip on the radar screen to many loan officers.

If you haven't done so already, it's time to sit up and take notice of this innovative loan that can change the lives of your clients, and change your business in the process. Let's take a look at some recent data, and see if you will decide to get "ready in reverse".

The first of the 77 million baby boomers in our country (those born between 1946 and 1964,) turned 60 in 2006. As with just about everything they have touched, they're going to have a dramatic impact on our economy as they age and move toward retirement. This is the largest generation in our country's history and they will define retirement on their terms. Travel, purchasing vacation properties, and helping children and grandchildren are goals sited for their future. However, it is no secret that many are not financially prepared for the lifestyle they want in their retirement years, and may continue working well past their intended retirement age.

Are you missing the opportunity to serve this demographic group as part of your overall strategy? The reverse mortgage can unlock built up equity that would otherwise be doing little or nothing for the senior homeowner. Utilizing your expertise, you become the solution when you show them how to effectively use this equity. When you combine the easy qualification guidelines, the fact that the loan proceeds are tax free, and the desire of seniors to remain at home, the possibilities are endless. As this product becomes more mainstream, the demand will increase for many years to come. New products as well as improvements to existing ones are on the horizon.

We all know the importance of maintaining those Realtor relationships in this uncertain market, and one thing is certain- your Realtor partners are hungry for the information. When you show them how a senior client can access tax-free funds from this mortgage and use those funds toward a vacation property or second home, you have just cemented that relationship. Help them build their business in a way they have probably not heard about before. You will be viewed as the expert, an innovator, and someone who really is a partner. Try speaking about reverse mortgages at your local board of Realtors (I teach a class for continuing ed once per quarter). Watch the reaction you'll get. That is just one way to market this product- there are many, many more.

No doubt the next several years will also be record setting years for these types of mortgages. As the population ages and the need to use equity as a financial tool in the retirement years becomes evident, it will become the natural product of choice. Many savvy financial experts are already including discussions about reverse mortgages in their overall planning strategy. There is even a product that targets the affluent senior. Imagine showing your client who has a home valued at $2 or $3 million how they can access tax free funds and never make a mortgage payment! No longer is this a product only for the destitute.

Loan originators who will be truly successful over the long term in this niche will be "ready for reverse". You'll need a game plan that is different from most things you have done in the past with your "forward" loans. Seniors will be among the most loyal customers you have ever seen. In addition, it is often their children who first investigate them for the seniors, and here is your chance to shine and win over that business as well. Frequently, after closing, I'll get a call a month or so later asking me if I can handle a refi or "move up" purchase for another member of the family. You can increase your sphere many times over just by doing one reverse mortgage.

There has never been a better time to embrace this niche product that targets the fastest growing age group in our country. Don't let another year go by...waiting could be costly.

Sue Haviland is a Certified Senior Advisor and founder of Reverse Mortgage Success where hundreds of loan officers around the country are learning the insider secrets to success in the fastest growing niche the mortgage industry has ever seen. She is an in-the- trenches loan officer who still originates every day.

Sign up for a free mini-course about reverse mortgages at http://www.reversemortgagesuccess.com and see what all the buzz is about.

Bad Credit Mortgages and IVAs

In times of rising interest rates and spiralling household debts, some people are left with no option other than to reorganise their finances in order to avoid bankruptcy.

One of the most popular methods of gaining relief from unmanageable debt is through Individual Voluntary Arrangements (IVAs).

The popularity of IVAs increases after long periods of low interest rates and excessive borrowing that are followed by periods of rapidly increasing interest rates. This is because the cost of the money previously borrowed will increase.

When this situation occurs, people who have over borrowed are forced to find solutions to their debt problems as they can no longer afford to keep up with their loan repayments.

An IVA is one of several ways of reorganising debts and using any surplus household funds to make repayments each month. IVAs are not an easy way out of debt and the rules are strict.

An alternative to IVAs is a debt consolidation loan. A debt consolidation loan is also called a bad credit mortgage and is secured against the borrower's home.

A bad credit mortgage allows for individual debts to be consolidated into one loan and the amount that can be borrowed will be based on the equity value of the applicant's home.

A bad credit mortgage can make the repayment regime of various individual debts more manageable as their will only be one monthly repayment amount to pay each month. This can help considerably with household budgeting.

When credit cards, personal loans, store cards, and other debts are consolidated into one bad credit mortgage, the loan products that originally had a shorter term will now have the same term as the bad credit mortgage. This means that although the amount of the monthly payments reduces, more money is repaid in the long term.

Neither an IVA nor a bad credit mortgage represents an easy way out of financial difficulties.

If you are facing debt problems, advice should be sought from debt counsellors and independent mortgage brokers in order to discover whether an IVA, a bad credit mortgage, or a different option altogether is the best solution to your debt problems.

UK Mortgage Source provides up-to-date Bad Credit Mortgage information.

Canadian Mortgages and Future Predictions

Mortgage Brokers in Canada

Surprisingly, one of the recently conducted surveys revealed that only 43% of people actually shopped around for the best mortgage, including mortgages packaged by brokers. Comparing rates of various lenders can help you save tens of thousands of dollars, get flexible terms and also get valuable assistance with hefty down payments.

Types of Mortgages in Canada

A fixed rate mortgage has a “fixed” rate of interest. The benefit offered by a fixed rate is that it remains constant throughout the life of the loan. These mortgages allow for consistency and are not dependent upon the marketplace. Experts recommend fixed rate mortgages so that borrowers as well as lenders can predict exactly what their payments will be every month.

With an adjustable rate mortgage, the interest rate is tied to the Bank of Canada’s interest rates. The major benefit of an adjustable rate mortgage is the low monthly payment during the time that the economy is faring well. However, there is the risk that interest rates could go up substantially if the market is not favorable. Many lenders entice borrowers by offering lower initial interest rates, which can increase a few fractions of a point each year. Within a few years, these rates can be much higher than traditional, fixed rate loans.

One of the more popular mortgages in Canada is called a “refi”, which is the refinancing of one loan by taking out a new loan, using the same property as collateral. Borrowers are cautioned to make sure the savings outweigh any fees associated with the refinancing. The reason these mortgages have become so popular in Canada is because many borrowers wish to escape their adjustable rate mortgages.

Mortgage Market Prediction

Canadian mortgage rates are directly affected by the actions of the Bank of Canada. By monitoring the interest rate on bonds issued by the Bank, anyone can get an indication of interest rate directions. The bond market is essentially a reflection of investors’ interest rate expectation for the future of the Canadian economy.

Investors who do their homework know that bond rates have been declining. The decline in bond rates results in lower interest rates on mortgages in Canada. The Bank of Canada has backed away from increasing rates due to recent unrest in the market. However, there is speculation the Bank of Canada may slightly raise interest rates in the coming months.

Please contact Maryam for more information: Vancouver Mortgage Broker

Reverse Mortgages - Fixed Interest Rates & 2nd Homes - Deal with the Direct Lender

In the financial world, going in reverse can mean gaining ground! By using a Reverse Mortgage, many seniors are getting money out of their homes by using equity to earn a tax-free income. If you own a home or condo worth $ 100,000 +, a Reverse Mortgage can be a major benefit. With real estate values continuing to drop, now is the time to take advantage of the various Reverse Mortgage programs before property values drop further. "For many seniors their home is the largest asset," said Stu Naar, Branch Manager for US Financial Mortgage Corp. in Boca Raton, Florida, and "although many shudder at the thought of borrowing on it, a home is a viable way to increase monthly income, providing extra cash for future stability."

As Reverse Mortgages gain in popularity, we now have more programs to offer with Fixed Interest Rates, and loans for 2nd homes. The reverse mortgage doesn't have to be paid until the homeowner sells the home or passes away, and the title to the home will remain in their name. Many people are confused about this product line. "Even if you have a current "forward" mortgage, the reverse mortgage may be the answer because the current mortgage would be paid off and you would still have additional savings," remarked Naar. There are 4 "Nevers" to keep in mind with a Reverse Mortgage.

1) You NEVER make a payment while living in the home.
2) You NEVER give up title to YOUR home
3) You are NEVER forced to move out
4) You and your estate can NEVER owe more than the value of the property at the time of sale.

A reverse mortgage is not only for homeowners that are financially strapped; it is also a means of improving a senior's quality of life. This is without a doubt, a true "Financial Strategy" that seniors should consider, especially if they are planning on staying in the property for at least 3-4 years or more.

Most banks are not originating Reverse Mortgages, since their profit is realized only when the loan is paid in full at the time the owners decide to sell the property. The homeowner does not make any monthly payments on the money taken with a Reverse, and pays off the total whenever they are ready. There are myths about Reverse Mortgages that need to be dispelled and explained to all potential clients prior to them proceeding. Mortgage companies originating this product have an obligation of Integrity and Honesty in providing the best possible advice to clients to tell a prospective client whether or not the Reverse Mortgage is in their best interest, based upon their individual circumstances.

As Reverse Mortgages gain in popularity, due to the ever increasing cost of living, Senior's are investigating this product thoroughly, making sure that the Lender they select is practicing a very rigid Code of Ethics, and has a good rating with the Better Business Bureau. You hear too many horror stories about unethical Mortgage Loan Officers and Brokers attempting to deceive people with "bait and switch tactics." Because of this increase in popularity, the addition of the Fixed Rate Reverse Mortgage, and loan availability on second homes is jumping to the forefront of conversations among Seniors.

For a free phone consultation, answers to your questions, and an informational packet on Reverse Mortgage programs, call Stu Naar, Certified Senior Advisor(CSA)®, and Branch Manager with US Financial Mortgage, in Boca Raton, at 561-995-2111 or 800-616-4008, or visit http://www.stunaar.com to use our Reverse Mortgage Calculator. Watch for our upcoming schedule of weekly FREE Lunch Seminars in South Florida.

Secure Power Through Reverse Mortgages

Sometimes, life plays a crucial role and hits a person on a wrong side. Especially, if a person is a senior citizen and is continuously struggling to meet the every day expenses by sacrificing little wish. However, not any more, as if the elderly person owns a house then he or she can definitely opt for reverse mortgages without thinking or taking enough time. Reverse mortgages can be a reason for their smile as they turn dreams into reality.

Reverse mortgages are loans available to senior citizens above or 62 years of age. These loans are used to release the home equity in the property as one lump sum or multiple payments. The homeowner's obligation to repay the loan is deferred until the owner dies, the home is sold, or the owner leaves the house and moves out somewhere else. In a typical mortgage, the owner of the house makes a monthly payment to the lender; after each payment the equity increases within his or her property, and typically after the end of the term for instance if the term is of 30 years then the mortgage is paid in full and the property is released from the lender. Whereas in reverse mortgages, the homeowner makes no payments and all interest is added to the lien on the property. If the owner receives monthly payments, then the debt on the property increases each month.

However, the American authorities generally advise that Internal Revenue Service do not consider loan advances to be income, annuity advances may be taxable, and interest charged is not deductible until it is actually paid, that is, at the end of the loan. The loan ends when the owner of the property dies, sells the house, or, depending on the loan conditions, moves out of the house for 12 consecutive months for example, into an assisted living home. At that point, the reverse mortgages can be paid off with the proceeds of the sale of the house, or be refinanced by the heirs of the debtor. If the proceeds exceed the loan amount, the owner gets the difference; however, if the owner dies, then the heirs get the benefits of the deal.

For cases where the proceeds are not sufficient to pay off the loan, then the bank or the insurance that the bank has on the loan absorbs the difference. It has been noticed that many borrowers move out of the property or die, as long as the borrower or his estate provides proof to the lender that he is attempting to sell the home or obtain financing to pay off the outstanding debt, the investor will allow him up to one year to do so. Here the lender looses all his powers and cannot force the debtor to leave his property after the completion of one year. The various types of are single-purpose, federally insured, and proprietary and covers the benefits also along with the drawbacks of the deals. Even the costs associated with getting reverse mortgages are similar to conventional mortgages. So do not wait and apply for these loans immediately.

Antonio Redford is a legal expert. He gives advice to clients who are looking for expert counsel on reverse mortgage. For more queries about Reverse mortgages,reverse mortgage Canada,American reverse mortgage, Reverse mortgages visit on www.reverse-mortgage-seniors.com

Second Mortgages - Weigh the Pros and Cons

What is a Second Mortgage?

As the name suggests, a second mortgage is another mortgage on your home. The term second implies that, in case you default on the first loan, this loan will not have re-payment priority. Priority is given to the "first mortgage" lender.

These loans are useful if you plan on making major renovations to your existing home. Most homeowners, generally speaking, do not have adequate cash on hand to perform major home renovations.

Another popular use for second mortgages is debt consolidation. The problem with debt consolidation is that it doesn't address the underlying, homeowner debt problems. Many homeowners pay off their debt and then proceed to run it back up again. Not good.

Are Second Mortgages Good or Bad?

Though second mortgages are sometimes the only way to raise substantial funds, you have to keep in mind that you're borrowing against your home. In effect, you are risking your existing home a second time. While it may be tempting to tap into the large source of equity via another loan, it can be catastrophic if you find you are unable to repay the loan at a later stage.

When considering taking a second loan, make sure that whatever you intend using the funds for is worth the risk you're taking (i.e. increased equity).

Another negative aspect of second mortgages is their higher interest rates. This is the bank's way of letting you know they will be compensated for the extra risk. Sometimes, depending on how much you need, second mortgages are simply not viable because of the heavy costs involved.

Loan Costs

Prior to applying for a second mortgage, it is advisable that you work out and budget for the probable costs, which will include the monthly payment, of course, as well as an appraisal fee, application fee, and other miscellaneous costs.

You will more than likely be required to cover any remaining closing costs. Keep in mind that even if your application is declined, the processing costs are usually non-refundable. Always ask for a printed list of miscellaneous fees before applying so you can better prepare.

Compare different lenders. Choosing reputable, established lenders who are willing to disclose all costs upfront can save you a lot of heartache later. Beware of lenders who offer irresistible deals but are unwilling to discuss the processing costs in detail. You don't want to end up paying more than you expected.

If you're considering a second mortgage, make sure you do plenty of research. Don't wait until you absolutely need a loan to do your research and apply. Trying to scramble for a large loan will lead to oversight, overpayments, and unwanted stress.

Find second mortage rate canada at your friendly Canadian mortgage broker, http://www.secondmortgageratecanada.ca.

Reverse Mortgages And Foreclosures - Could A Reverse Mortgage Get You Out Of Foreclosure?

I read an article today on Yahoo News showing that foreclosure filings have increased by over 100% year over year. That's right, over 100%. According to Realty Trac Inc., the number of homes that received some kind of foreclosure action notice increased from 223,233 in the 3rd quarter of 2006 to 446,726 in the 3rd quarter of 2007.

Even more disturbing was the 33.9% increase from the second quarter of 2007 to the 3rd quarter of 2007. What does the increase in foreclosures have to do with reverse mortgages? And, why are we seeing such an increase in foreclosures? We will tackle the second question first and then talk about the first question.

So, why has there been such a dramatic increase in foreclosures? With the bursting of the "dot com" bubble, the fed began an aggressive pattern of cutting interest rates. This led to an over-supply of cheap money, making it easier for people to buy houses. With the increased demand for housing, values began to skyrocket. People were no longer buying houses to live in, they were buying houses on speculation that the values would keep increasing and they could turn around and sell the house for a quick buck.

But, a funny thing happened along the way. As the market started to turn in 2006, companies - in the quest for volume - began to loosen guidelines. Basically anyone with a pulse, who could fog a mirror, was getting approved for a loan. With loose underwriting standards - including stated income (aka "liar loans") and no documentation loans - just about anyone could get approved.

Further, with no one around who wanted to say "No" to a loan, lenders loaned money to people who otherwise, would not be able to even rent an apartment. Think about it this way, the industry allowed people, who couldn't come up with one month's rent and one-and-a-half month's security deposit, to become homeowners. I could go on, but there have been plenty of articles written that fully describe the mortgage industry's "implosion" by much smarter people than myself.

If you've read this far and are still wondering what this has to do with reverse mortgages, I'll answer that question in the next few paragraphs. As mortgage professionals, we have a responsibility to put clients into loans that make sense for them. We have a responsibility to put borrowers into loans that they can afford to pay back (barring unforseen circumstances or "life events" - like job loss, death, etc.) More importantly, we have a responsibility to tell borrowers when something doesn't make sense.

Option ARMs, negatively amortizing loans, interest only, 2/28 ARMs with rates that skyrocket after 2 years have all been talked about in the media for the last several months. Those 2 year "exploding ARMs" that would create a huge payment 2 years from now, were very popular. Often times, borrowers were put into loans they didn't understand by loan officers who barely understood them themselves. Too many times, either through ignorance or greed, loan officers put borrowers into loans that made no sense for them.

No Doc and Stated loans allowed lenders to take elderly borrowers and put them into traditional "forward" mortgages that made no sense for their situation. The seniors would take cash out of their property and make payments until that cash ran out. So now, 2 years later, the senior comes back and takes out another cash out loan - meanwhile the loan officer, is making commission all over again - and on the full amount of the new loan! That's one heck of a way to make a living.

Instead of putting the senior into a reverse mortgage, that would eliminate the monthly payment, it was much more profitable to keep doing cash out refinances for the borrower. Why make commission once, when you can make commission two, three or four times - on an ever increasing balance?

I'm sure there are seniors today that are in foreclosure that are there because they were put into a loan they couldn't afford in the first place. Or they took out a loan that they shouldn't have - a loan with payments - when a reverse would have been the better way to go. If you feel you were a victim of predatory lending, click here to get information for your state's resources on anti-predatory lending from the Department of Housing and Urban Development.

A reverse mortgage is one of the few programs available to seniors that can pay off an existing lien that is in foreclosure. Of course, that may not be the best way to go. But if you hear traditional loan officers talking about "hard money" run (don't walk) away from them. If you are thinking of answering one of those signs you see at every street corner - you know, the ones that say "we buy houses," "we can save you from foreclosure," again, run away.

If you are in foreclosure, call your lender, ask them for help, they may be able to work something out with you. Be persistent and expect to spend some time on hold before you get through. At the same time, call another lender, loan programs vary from lender to lender, your current lender might not be able to help you, but a new lender may. You may also want to call a Credit Counseling service. Borrowers over 62, should seriously think about a reverse mortgage. With a reverse, you eliminate the monthly payment and in many cases create a payment TO yourself from the house.

The good news in the mortgage industry's meltdown is that the crazy loans that were out there are slowly going away. The market will eventually stabilize. The bad news for the industry is as originators search for new ways to generate volume, the same vultures that preyed on subprime borrowers are now going to go after our seniors.

Henry Salomon is a 13 year mortgage industry veteran. He has worked in varying capacities throughout his career including: loan officer, branch manager, underwriter, secondary marketing, credit risk management and more. He counts large banks and Wall Street firms among his former employers. He has been a speaker at broker conferences and a panelist at mortgage round table discussions. He is currently the Vice President of Retiring in Comfort. At Retiring in Comfort, he does workshops throughout the state to present reverse mortgages as well as various topics of interest to seniors. To schedule a workshop, he can be contacted at henry.salomon@yahoo.com

Article Source: http://EzineArticles.com/?expert=Henry_Salomon

Cheap UK Mortgages And Your Financial Health

The financial health of the UK is declining day by day. Personal debt is increasing by a staggering £1 million every four minutes, with the average household debt increasing by £13 every single day. This is enough to make every individual in debt's eyes water just thinking about it. As a result, it is important to take all of your financial information into consideration before applying for cheap UK mortgages. No matter how cheap they are marketed as, if your financial health is poor then you should make sure that you could afford it before applying.

Financial health and cheap UK mortgages do go together well though. Cheap UK mortgages can in fact save you thousands on your repayments over the term of the mortgage simply because the interest rates are often lower than those offered by the more expensive lenders out there.

Your financial health is more important today than it ever has been before. Personal debt is increasing, inflation has risen to over 3% and interest rates are anything but stable in the rocky global economy at the moment, so there are more problems associated with borrowing money than ever before. It can be extremely difficult to get out of debt once you are in it, and that includes mortgages. However, cheap UK mortgages can provide individuals with a way to stave off the threat of the vicious debt circle that can consume them.

Cheap UK mortgages are worth looking into because there are some great deals out there. They can actually improve financial health instead of being detrimental to it so it is important to ensure that the mortgage selected is the best possible deal for you. Take a look at the associated charges, the flexibility and the terms and conditions before deciding on the definitive mortgage for you. When you are happy then sign on the dotted line and make the most of the cheap UK mortgages deal!

http://www.creditaction.org.uk/debtstats.htm

Jason Hulott is Business Development Director at UK Mortgages service, PolarMortgages. Visit Polar Mortgages now for more information about UK mortgages and remortgages.

100 Percent Holiday Home Mortgages Can Be Hard To Secure Unless You Go With A Specialist

While you could shop around yourself for 100 percent holiday home mortgages they can be hard to find - you will have to know who specialises in holiday home mortgages if you want to get the cheapest deals, otherwise you will spend a lot of time searching and in some cases to no avail. A specialist broker in mortgages can shop around on your behalf and secure you the cheapest rates of interest and pass them onto you for you to consider.

In the majority of circumstances all that's needed to get the initial quotes for holiday home mortgages are a few basic details and your specialist can search through hundreds of lenders on your behalf. You will have to give some thought as to if you are going to buy to let as this will make a difference with some lenders as to whether or not you will get a 100 percent holiday property mortgage. In some cases you will not get the full mortgage and could have to make up the mortgage by taking out a secured homeowner loan but again a specialist should be able to find the best deal for you.

While a specialist in holiday home mortgages will be able to get you the best deal on the APR for your 100 percent mortgage the rates of interest will depend on your circumstances and can vary greatly from one lender to another.

One thing you have to be aware of when taking out a secured loan is that your property is at risk of being repossessed if you default on the holiday home mortgage and with loans being taken out for up to 25 years you have to know with certainty what you are getting yourself into.

Factors to take into consideration when deciding how much you want for the holiday home mortgage is how much your primary residence is worth, or in other words the equity you have in it because this will depend on the amount you can borrow and of course as you are looking for a 100 percent holiday home mortgage then this will make a big difference.

Sean Horton is a Director of Holiday Let Mortgages which offers UK residents the finance to buy a UK based holiday home. The site offers information about 100 Percent Holiday home mortgages, and second property mortgages.

Property Development Mortgages Need Careful Consideration

If you are looking for property development mortgages then you have to give them careful consideration, as with all types of mortgage. You are far better off going with a specialist mortgage broker to make sure you understand what you are getting into and to ensure that you get the best deal for your property development lending.

When going for the this type of mortgage there are many factors that the lender will take into account - one of the main factors that is taken into consideration by the lender is the location of the property. There is also certain criteria that has to be met with the majority of for property development mortgages. For example you could be turned down by lenders if you haven't got three years' Accounts to show or if you have an income that is variable or you have problems proving your income.

However a specialist property development mortgages broker will be able to help in most circumstances and with some lenders can even give you funding for up to 90%. The specialist will be able to search for the best deals for you based on the information you provide them and then deliver the results for you to compare. As with any type of mortgage always make sure you read the small print of the mortgage policy including the key facts of the lending as with this is where you will find the terms and conditions of the loan.

The finance rates for property development mortgages will vary for the mortgage depending on certain factors of the individual property developer; some of the main factors that are taken into account include your previous experience and the industry sector. As there are different criteria to meet and a property development mortgage is dependant on your circumstances then a specialist will be able to go through the criteria with you and ensure that you get the best deal possible.

Sean Horton is a Director of Enhanced Wealth, a whole of market mortgage broker and IFA specialising in the provision of mortgage advice, income protection, mortgage protection and property development mortgages

Mortgages Make The World Turn

Mortgages are popular. In fact, they aren't just popular, they're necessary for almost anyone who wants to buy a home. There are many benefits to owning a home. But money is what makes the "home go 'round".

Take a look at some of the benefits to these mortgage loans:

• Enable you to buy a house of your own - without having to pay the full amount up front
• Help give you the leverage you may need to take advantage of a booming housing market
• Give you the greater percentage of money required to buy a house, helping with budget flexibility
• Even though you borrowed money, you are free to make changes to your house
• Can also be used for major renovations on your existing home

With real estate becoming a lucrative business opportunity-we've all see the late night infomercials-more and more people who wish to invest in other properties are finding these acquisitions easier.

There are many institutions that provide mortgage loans. Like your local supermarket, each of them offers different interest rates and have different repayment terms and tenures. Lenders need you more than you need them so shop around for the best rates and terms.

Increasing competition in the banking sector has compelled banks to offer customers highly attractive interest rates and more relaxed terms and conditions for repayments. There is an increasing trend among banks and financial institutions to offer clients customized mortgages designed for maximum financial help and support.

The internet is the perfect place to start your search for a mortgage. Nearly every lending institution provides detailed packages online, making it easier to compare different scenarios and choose the best one.

Most banks offer online loan applications-although you may have to go into a local branch for loan finalization.

Whatever your circumstance or experience, getting your dream home is easier and more convenient that you think. Do your research, get the best rate and terms, and you'll be re-painting your next house in no time!

Looking for a home in London? Find competitive rates and packages with your London mortgage broker.

Hard Money Lenders Can Provide Mortgages to Homeowners in Foreclosure

One of the first methods that homeowners typically pursue to avoid losing their homes to foreclosure is a new refinance. Unfortunately, many banks no longer provide loans to homeowners with very little equity, low income, and bad credit. Some, though, will not provide a loan no matter what, as long as the home is in foreclosure. For homeowners who do own a significant amount of the home and have paid down their original mortgage, hard money lenders may be able to provide a source of funding to help them save their homes. There are various hard money loan programs offered by numerous lenders and investment groups, and, although there are additional qualifications and costs that must be met, this type of loan can be closed in a very short amount of time and can be used when homeowners are running short on time.

The most usual provider of hard money loans is an institutional lender or group of private investors who have come together and created a company that pools money and invests in real estate by providing mortgages. The value of the real estate and the interest charged on the loans make up the largest portion of the profits these companies make. They are mainly used by borrowers who do not have a lot of time to close on the mortgage, when the borrower does not wish to keep the property for longer than a few months, if the borrower can not give out their credit history or other financial information, or for larger loan amounts that traditional lenders would not be able to provide funds for. These loans can be used for creative financing purposes, as well as giving foreclosure victims one more solution to save a home.

There are two main considerations in qualifying for a loan through a hard money lender: equity and loan amount, and income. Many of these lenders will not loan more than 65-70% of a home's value, and foreclosure loans may have even stricter lending guidelines, depending on the company. Unless homeowners can work out a short payoff to refinance, this will disqualify the vast majority of foreclosed homes from getting a loan. The related requirement of the loan amount means that homeowners must borrow a certain amount of money to get the loan in the first place. Most hard money lenders have requirements of $75,000-$100,000 as a minimum, due to the nonexistent profits of managing properties with lower values.

Thus, homeowners must meet two related qualifications of having a property that with a high enough value, and having significant equity in that property. It can often be difficult to calculate if lower-valued homes will even qualify for these kinds of loans. For example, if the necessary requirements are 65% loan-to-value (LTV) and a $100,000 minimum loan, the homeowners will need a property worth at least $154,0000. If the requirements are 70% and $75,000, the house will need to be valued at $108,000. Hard money lenders' qualifications can vary dramatically from one company to the next, so foreclosure victims can shop around for the best deals, especially if they are turned down the first time.

The second major requirement to meet for this type of loan is that the homeowners must have enough income to make the mortgage payment. A credit check is usually necessary for the lender to take a look at the foreclosure victims' other monthly obligations to determine how much of their incomes will need to be paid on the mortgage. If the homeowners do not have enough income to pay the mortgage, all their other debts, and keep the lights on and provide for their families, the hard money lender can not make the loan and expect it to be paid on time. This is why most of these lenders will require a credit check: not to determine the homeowners' score, which is typically low or else they would qualify for a traditional loan to stop foreclosure, but to help determine if they can afford the payment at all.

But, for the lucky few homeowners who are able to qualify for a foreclosure bailout from a hard money lender, the fun does not end. The loans typically have higher costs because of their unique nature and specialized uses. It is not uncommon for homeowners to be charged 4-5 points on the loan, which is simply the lender's up front fee for making the loan at all. Interest rates can also be sky high, in the range of 12% to over 20%. This often results in a higher mortgage payment for the homeowners than they originally had, making is absolutely essential for them to have recovered financially from their hardship and have established some sort of emergency fund to protect against future drops in income.

Despite the strict requirements of this type of foreclosure loan, homeowners who meet the qualifications often find they are able to stop foreclosure very quickly and get a new loan, making this a viable solution. Although they are more expensive than traditional mortgages, they are designed to offer homeowners a short-term solution to foreclosure and allow them the chance to save their homes and begin to establish an on time mortgage payment history. The hard money lender, in turn, makes a high rate of interest on a reasonably safe investment, and provides foreclosure victims with an additional option to avoid losing their homes, making a significant positive contribution to local communities and individual families.

The ForeclosureFish.com website provides homeowners with foreclosure information and advice designed to help them save their homes. Homeowners can read through basic descriptions of various ways to avoid foreclosure, including short sales, hard money loans, and bankruptcy, among others. With hundreds of pages of reference materials, blog entries, and articles, foreclosure victims can put together a comprehensive plan. Visit the site today and begin learning how the foreclosure process works and how it can be stopped: http://www.foreclosurefish.com/

Energy Efficient Mortgages - Who Offers Them?

Green mortgages have been around since the late 1970's. President Jimmy Carter authorized them and until recently they have had the backing of Fannie Mae and Freddie Mac. In January of 2007, Fannie Mae discontinued underwriting these mortgages to leave the only backing of them through Freddie Mac. Freddie Mac's program for these mortgages is through their FHA 203(k) rehabilitation loan and a VA loan variation.

Officially, Fannie Mae and Freddie Mac and most mortgage industry professionals refer to the green mortgage as the Energy Efficient Mortgage (EEM). The basic structure of this mortgage program comes in several forms. One option for this loan is that the lender will lend additional money to the home owner to allow the home owner to make energy efficient home improvements. Another option of this loan is that the lender will provide a discount on some closing costs if the home owner if there are energy efficient appliances in the home or being purchased as a result of the mortgage. A third version of this program is when the lender offers to perform some sort of community service such as planting trees in exchange for taking out a mortgage with them.

As mentioned earlier, Freddie Mac through their FHA and VA loan programs still offer the EEM's. For FHA, the loan is available through their rehabilitation loan, or the 203(k) loan. This is a common loan for homeowners who want to use their mortgage through FHA to do home improvements. FHA allows up to $8,000 in energy efficient property upgrades. To qualify for the EEM, the home owner has to pay for a HERS inpection, or a Home Energy Rating Systems report. This report is used to determine the efficiency upgrades as well as being used to determine the monthly savings a homeowner will realize if the improvements are made to the property.

Once the HERS report is complete and home improvement plan is drafted and FHA approves the total package, money is set aside at the loan closing to pay for the work to be completed. This money is held by the title company who does the loan closing and is only authorized to release the money for the project once the work is completed. An FHA inspector or the appraiser on the loan will inspect the completed work to authorize the release of the money held at title.

As far as the VA green mortgage active duty personel, reservists, and retired veterans can get this loan. The eligible borrower can borrow up to $6,000 if the energy upgrades are determined to be more efficient than if the work hadn't been done. As a standard feature of the VA EEM, the homeowner is able to finance up to $3,000 by just showing the costs of the upgrades without proving the efficiency improvements.

With the onset of concern about global warming and the environment many homeowners are looking for ways to save money and have a positive impact on the world around them. FHA and VA still provide a viable option for Green Mortgages. Perhaps, as the cultural conversation about the environment increases, Fannie Mae will reintroduce their program again. For further information on FHA, VA, and other loan programs visit GetPreQualified.com

Article written by: Dale Stouffer. Dale has been a mortgage broker since 1996 and has served on the Pennsylvania Association of Mortgage Brokers as an instructor to other mortgage brokers, and as a education and legislative chair at both the local chapter and state levels. Dale owns GetPreQualified.com, which is a consumer credit and financial services education and product portal.

Fixed Rate Mortgages And The 2007 Interest Rate Rises

During 2007, interest rates have gradually risen to their highest levels since March 2001. As of July 2007, the Bank of England interest rates stood at 5.75%, after rising a staggering five times since August 2006. When you pair that fact with another major economic event, namely inflation rates rising above 3%, homeowners and potential homeowners should be wincing under the financial strain. Fixed rate mortgages should therefore look appealing at the moment.

With economic crises occurring all over the world, the global economy is looking anything but stable at the moment. As a result of the interest rate rises in the UK though, individuals that do not have fixed rate mortgages have seen their mortgage payments rise by anything up to £20 per £100,000 a month since August, with that total increase being much more since the beginning of the year. Although this amount ay not sound like a lot, it can put strain on individual households and send some into financial difficulty.

Fixed rate mortgages may provide the solution to this problem. The mortgage rate is fixed for a period of time, which is usually one, two or three years, although a few providers do offer up to five years. There are often penalties if you do switch provider during the contracted period. However, fixed rate mortgages mean that you are never a victim of rising interest rates and you can guarantee your monthly repayments.

Fixed rate mortgages have their distinct advantages over other kinds of mortgages purely because you know exactly where you stand. However, you should make sure that the fixed rate mortgages deal you choose is the best possible option for you because once you are in a fixed rate mortgages contract, it will cost you to get out!

http://news.bbc.co.uk/1/hi/business/6272776.stm

Jason Hulott is Business Development Director at UK Mortgages service, PolarMortgages. Visit Polar Mortgages now for more information about UK mortgages and remortgages

The Art Of Finding Mortgages For Bad Credit

As of July 2007, the UK's personal debt level rose to £1,355 billion, which was its highest level ever with an increase of 10.1% on the previous year. This amazing fact, when coupled with the fact that the level of inflation has risen to over 3%, means that more and more individuals will struggle with the debts they already have and will damage their credit records as a result. This would have caused those individuals problems in the past when looking to buy a home, but mortgages for bad credit have a very real place on the market at the moment.

Mortgages for bad credit were born out of societal needs, purely and simply because the housing market would have ultimately suffered. The amount of individuals with bad credit has infinitely risen since the turn of the millennium and so mortgages for bad credit solved a major problem within the industry.

There are any providers that offer mortgages for bad credit so that option is definitely worth exploring if individuals are struggling to get a mortgage on account of their bad credit, or those that know they will struggle when they begin to apply. However, there are some elements of mortgages for bad credit that every individual exploring the option should keep in mind.

The first is the interest rate. Mortgages or bad credit generally tend to have higher interest rates that regular mortgages because of the extra risk factor for lenders. However, the rates vary greatly within the mortgages for bad credit sector itself so it may be worth comparing them before making your choice.

Also, be sure to read the terms and conditions for hidden costs, early repayment fees and clauses that could restrict your freedom to move providers when your credit rating improves. Mortgages for bad credit can actually help you to improve your credit, but be sure to fully check what you are getting yourself into before committing.

http://www.creditaction.org.uk/debtstats.htm

Jason Hulott is Business Development Director at UK Mortgages service, PolarMortgages. Visit Polar Mortgages now for more information about UK mortgages and remortgages.

Hard Money Lenders can Provide Mortgages to Homeowners in Foreclosure

One of the first methods that homeowners typically pursue to avoid losing their homes to foreclosure is a new refinance. Unfortunately, many banks no longer provide loans to homeowners with very little equity, low income, and bad credit. Some, though, will not provide a loan no matter what, as long as the home is in foreclosure. For homeowners who do own a significant amount of the home and have paid down their original mortgage, hard money lenders may be able to provide a source of funding to help them save their homes. There are various hard money loan programs offered by numerous lenders and investment groups, and, although there are additional qualifications and costs that must be met, this type of loan can be closed in a very short amount of time and can be used when homeowners are running short on time.

The most usual provider of hard money loans is an institutional lender or group of private investors who have come together and created a company that pools money and invests in real estate by providing mortgages. The value of the real estate and the interest charged on the loans make up the largest portion of the profits these companies make. They are mainly used by borrowers who do not have a lot of time to close on the mortgage, when the borrower does not wish to keep the property for longer than a few months, if the borrower can not give out their credit history or other financial information, or for larger loan amounts that traditional lenders would not be able to provide funds for. These loans can be used for creative financing purposes, as well as giving foreclosure victims one more solution to save a home.

There are two main considerations in qualifying for a loan through a hard money lender: equity and loan amount, and income. Many of these lenders will not loan more than 65-70% of a home's value, and foreclosure loans may have even stricter lending guidelines, depending on the company. Unless homeowners can work out a short payoff to refinance, this will disqualify the vast majority of foreclosed homes from getting a loan. The related requirement of the loan amount means that homeowners must borrow a certain amount of money to get the loan in the first place. Most hard money lenders have requirements of $75,000-$100,000 as a minimum, due to the nonexistent profits of managing properties with lower values.

Thus, homeowners must meet two related qualifications of having a property that with a high enough value, and having significant equity in that property. It can often be difficult to calculate if lower-valued homes will even qualify for these kinds of loans. For example, if the necessary requirements are 65% loan-to-value (LTV) and a $100,000 minimum loan, the homeowners will need a property worth at least $154,0000. If the requirements are 70% and $75,000, the house will need to be valued at $108,000. Hard money lenders' qualifications can vary dramatically from one company to the next, so foreclosure victims can shop around for the best deals, especially if they are turned down the first time.

The second major requirement to meet for this type of loan is that the homeowners must have enough income to make the mortgage payment. A credit check is usually necessary for the lender to take a look at the foreclosure victims' other monthly obligations to determine how much of their incomes will need to be paid on the mortgage. If the homeowners do not have enough income to pay the mortgage, all their other debts, and keep the lights on and provide for their families, the hard money lender can not make the loan and expect it to be paid on time. This is why most of these lenders will require a credit check: not to determine the homeowners' score, which is typically low or else they would qualify for a traditional loan to stop foreclosure, but to help determine if they can afford the payment at all.

But, for the lucky few homeowners who are able to qualify for a foreclosure bailout from a hard money lender, the fun does not end. The loans typically have higher costs because of their unique nature and specialized uses. It is not uncommon for homeowners to be charged 4-5 points on the loan, which is simply the lender's up front fee for making the loan at all. Interest rates can also be sky high, in the range of 12% to over 20%. This often results in a higher mortgage payment for the homeowners than they originally had, making is absolutely essential for them to have recovered financially from their hardship and have established some sort of emergency fund to protect against future drops in income.

Despite the strict requirements of this type of foreclosure loan, homeowners who meet the qualifications often find they are able to stop foreclosure very quickly and get a new loan, making this a viable solution. Although they are more expensive than traditional mortgages, they are designed to offer homeowners a short-term solution to foreclosure and allow them the chance to save their homes and begin to establish an on time mortgage payment history. The hard money lender, in turn, makes a high rate of interest on a reasonably safe investment, and provides foreclosure victims with an additional option to avoid losing their homes, making a significant positive contribution to local communities and individual families.

The ForeclosureFish.com website provides homeowners with foreclosure information and advice designed to help them save their homes. Homeowners can read through basic descriptions of various ways to avoid foreclosure, including short sales, hard money loans, and bankruptcy, among others. With hundreds of pages of reference materials, blog entries, and articles, foreclosure victims can put together a comprehensive plan. Visit the site today and begin learning how the foreclosure process works and how it can be stopped: http://www.foreclosurefish.com/

Helpful Information On Mortgages

The first thing you'll want to do before you start looking at the various mortgages and mortgage lenders available is understand what a mortgage is, how the process works and who takes part.

Mortgages are simply methods of using your personal property or real estate to secure your payment of a debt. The term mortgage comes from the French word for death vow. It refers to the legal means that is used to secure the property, although it most commonly refers to the debt that is secured by that mortgage. In other words, the terms mortgage and mortgage loan are commonly used interchangeably.

In just about every jurisdiction mortgages are associated with loans that are given on real estate rather than on any other property such as water craft. There are cases where raw land is mortgaged as well. The securing of a mortgage simply means that individuals or businesses use the accepted method of purchasing either commercial or residential property without having to pay the full price on their own immediately. So there are residential mortgages and commercial mortgages commonly provided throughout the world on a regular basis.

It is far more common for either individual or commercial enterprise to seek out mortgages and mortgage lenders to buy real estate than for them to pay the full price for the property on their own. Nowadays mortgages are the way of the world. The most active markets for mortgages - where the demand for real estate is high - are the United States, the United Kingdom and Spain.

While there are some variations due to language constraints and colloquialisms, the two standard participants in mortgages are the creditor and the debtor. The creditor is, quite simply, the person or financial institution lending the money to buy the real estate or other property. The creditor has legal rights to that debt that is secured by a mortgage. The debtor usually lends to the debtor the money needed to purchase the property. Mortgage creditors are typically banks, insurance firms or other financial institutions such as credit unions. The two other common names for these creditors which are mortgagees or lenders.

A debtor is the one who secures the mortgage loan in order to buy the property - the new property owner. The debtor has to meet the mortgage lender's financial requirements and conditions during the life of the loan to prevent the mortgages being cancelled and the property reclaimed by the lender. These debtors are also called mortgagors, obligors or borrowers.

Attorneys will often enter the mortgage fray as well, as representatives usually of the debtor. Depending on the locale they may be referred instead as the conveyance or solicitor.

A mortgage broker may be part of the mortgage process. This professional, rather than licensed and employed by one mortgage or banking firm, has familiarity with many and is responsible for doing the search and comparison of many mortgage firms and options, and finding the would-be debtor the best mortgage deal. The mortgage broker may be a certified financial advisor, or the debtor may secure the help of one for the best financial mortgage options, and help acquiring the most competitively priced loan.

James Copper is a writer for http://www.any-loans.co.uk/mortgages.php where you can get information on mortgages

Mortgages to Help Fund Business Ventures

Some people dream of taking the movie world by storm. Others dream of making a mark in journalism. Still others dream of starting their own ventures. Starting a business is what some people aspire to do. It may not be the easiest thing in the world. The way to business success may be paved with many thorns. But the young entrepreneur knows what he wants and is keen to get it. Henry David Thoreau famously said, "If you have built castles in the air, your work need not be lost; that is where they should be. Now put the foundations under them." Now there is a quotation that every budding entrepreneur could take note of.

No business can be formed solely on the strength of one's dreams. A lot of work goes in to making that dream a reality. Every successful venture is built up on the foundations of hard work. A lot of research also has to be done before any business venture can be floated. Much time is spent in studying how similar businesses have begun. Purchasing equipment, finding employees, and building networks are essential aspects that have to be taken care of. Farming out functions to other people may also be an option that the entrepreneur could be looking at.

However, before the business can start functioning, the entrepreneur has to find a suitable base of operations. Finding the ideal office may be backbreaking work. But this will be good practice for the future. To begin with, you will have to look at places which will be suitable for your venture. Do you require the services of other people and organizations? If so, it would be a good idea to look for an office which would be in proximity to those service providers. Are you looking at attracting new customers? If that is your aim, you would have to look for a prime location in a desirable place. You would also have to make sure that the area attracts the target audience that you will be servicing.

The next question that the entrepreneur has to ask is "Can I afford such a place?" For the budding entrepreneur, money might be tight. Without another large source of income, the young business person with a dream may face himself clutching at straws. But there are ways in which one can afford that ideal office. The business mortgage is a great blessing for all young entrepreneurs.

The business mortgage is perfect for those who are looking to buy an office. The terms can be anywhere between five and thirty years. The repayment schedule would be an important factor to consider. You could pay equal installments over a period of time or you could just pay the interest every month and a final bulk amount. Many combinations of the above two modes are also possible; Some mortgages require the borrower to invest in an endowment fund which would end up paying off the principal. The serious entrepreneur would make it a point to look at a variety of options before deciding on the mortgage option that would suit him best.

Buyer Beware! Make sure to Compare mortgages before you get business mortgages or other Mortgages.