Real Estate Blog

Congress passed legislation on Thursday that calls for the loan limits of FHA insured mortgages to be restored to their pre-October 1st limits. President Obama signed the bill into law on Friday and the increased limits will stay in effect until 2013.

The increased loan limits are limited to FHA mortgages. Fannie Mae and Freddie Mac dropped their maximum loan limits in Riverside and San Bernardino counties October 1st from $500,000 to $417,000. This is the first time that Fannie Mae and Freddie Mac limits are lower than the limits for FHA insured mortgages.

Prior to passing the bill the FHA loan limit was $355,250 for both San Bernardino and Riverside counties. Now home buyers looking up to $500,000 can purchase a home with as little as 3.5% down.…

The entire loan modification process is flawed. The loan modification process is designed to fail. The biggest problem is that the lenders do not realize how much the housing market has declined. They think that kicking you out of your home will make them more money. The negotiations are all based off of how much the lender can squeeze out of you. They won't stop squeezing you until you repay every dime plus interest, attorney fees, and any other junk fees they can tack on. As a result, many loan modification customers end up paying more than their home is worth. Maybe they have a $450,000 mortgage, but their home is only worth $300,000. The homeowner can afford a payment equal to a $300,000 mortgage. However they can't afford to pay a $450,000…

Bank of American and PNC have stopped foreclosures amid document issues. The moratorium on foreclosures is to start on Saturday. PNC Financial Services Group INC is stopping proceedings in 23 states for a month in order to review documents to make sure they are complying with state laws. Bank of America has taken a more wide spread approach and stopped foreclosures in all 50 states.

These moves come amid political pressure on big US Banks to review foreclosure documentation problems. Bank of American has added fuel to the fire by being the first to admit that the banking industry has used "robo-signers." These are people who sit in rooms and do nothing but sign hundreds of documents, they do not review anything, they just sign.

What does this mean…