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30 Mar 10 Obama Expands Home Affordable Modification Program

The Wall Street Journal reported that most the largest mortgage lenders carry hundreds of billions worth of home equity loans on their books. A spokesman for the California Mortgage lender, Nationwide Mortgage said “Most of the second mortgages that are defaulting are from the 100% subprime combo loans, also known as 80-20 loans.”  These equity loans had high adjustable rates and many even had large balloon payments.

As home prices have nationally declined by almost 30%, these second mortgage liens are worthless in the case of a foreclosure. Second mortgage loans are usually wiped out completely during a foreclosure if the price has decreased more than 20%.  Read the original article online.  Many believe that Obama pushes the mortgage bailout agenda rather than correcting the core lending problems. Read the original blog post > HAMP Helping Second Mortgage Lenders?

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Reader's Comments

  1. |

    Hi, I’m just getting started with my new mortgage company. Our focus will of course be home refinancing. We plan to focus on conforming and FHA lending in the beginning… What other niches or loan programs do you recomend?
    - Tony O



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