Friday Facts 9-10-10

September 10, 2010

Steve Bergsman of Inman News has an article on a new approach to keeping people in their homes. ISGN Corp., one of the largest providers of services and technology to the mortgage industry is partnering with EquityRock of San Francisco to offer a program called RESET (Real Estate Shared Equity Transaction). RESET gives borrowers who are qualified for a loan modification a principal reduction so they are no longer underwater in exchange with the lender for a share in any future equity.

HUD is claiming that the newly passed premium amounts going into effect September 7, 2010 will save the consumer money. It won’t. While the upfront premiums have dropped from 2.25 to 1.25, the annual premiums will nearly double. A $200,000 loan with a 3.5% down payment has $4,500 upfront premium and $1,100/year in annual premiums. After September 7th, the upfront premium falls to $2,500, but the annual premium rises to $1,800, an extra $58/month.

Buzz Tool on ZipRealty.com enables homeowners to post a trial listing of their home to get feedback from active buyers in their area. A real time Buyer Buzz results page gives feedback from agents and results of an online poll regarding the proposed list price.

Bernice Ross writes in Inman News: “The Health Care Bill changes how “miscellaneous income” is reported. The bill seems to require anyone who purchases $600 or more of business products to issue a Form 1099-MISC to the company from whom they purchased the product. In other words, if I buy $600 of office supplies at Staples, I have to give Staples a form 1099.”

FHA’s new underwater program will be launched on September 7, 2010. FHA will offer certain non FHA borrowers who owe more on their mortgage than their property is worth, the opportunity to qualify for a new FHA insured mortgage if their lender agrees to write off at least 10% of the unpaid principal balance of the first mortgage. This applies to primary residences; the borrower must qualify for a loan under standard FHA underwriting requirements; and the borrowers combined LTV ratio can be no more than 115% after the 10% write-off. The Treasury will provide incentives to existing 2nd lien holders who agree to full or partial release of the liens.