Sunday Mortgage News Roundup

CNN reports that the Foreclosure prevention plans that are before congress right now are under attack for a couple of reasons. Lenders are claiming that as it increases risk and lowers profit for investors it could ultimately drive interest rates up across the board. One analyst is predicting as much as a percent and a half increase. The other criticism is that it will only help a relatively small percentage of those in trouble. You can read more about it in CNN’s Article on Foreclosure Prevention Plan Under Attack.

While interest rate resets are looming on the horizon for many homeowners, it seems that subprime mortgages are going into default at an alarming rate BEFORE they reset. CNN reports that 11.2 percent of subprime loans issued in 2007 are in default. If you watched the flash presentation on A Subprime Primer you may have noticed that they mentioned Liars Loans and CNN’s article on Subprime Loans Defaulting takes a look at why these loans are defaulting.

If you are considering buying a house, Liz Pulliam Weston at MSN Money has some great advice in her post on 8 Big Mortgage Mistakes And How To Avoid Them. In particular, her advice on fixing your credit BEFORE you apply for a loan is spot on. If you have not pulled your credit report, it’s a good idea to do so 3 to 6 months in advance of a major purchase. This gives you time to resolve any issues and time for your FICO to reflect any changes. Her advice on shopping for rates and terms is exactly the reason why you will want to work with an experienced loan officer whom you can trust to give you different options and an explanation of why each might be better for you.

If you are in trouble and think you might lose your home, Save Invest and Retire has some excellent resources to help avoid foreclosure in his post on Walk Away From Your Home Part II Resources. While many are making a choice to walk away, the consequences that foreclosure will have may be more far reaching than you believe.

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