Making Home Affordable Program extended to 12/31/2015

Pursuant to Supplemental Directive 13-04 of this month, the Making Home Affordable Program, including HAFA (short sales) and HAMP (mortgage mods), is extended through the end of 2015.

Additionally, Supplemental Directive 13-04 simplifies the income documentation requirements under HAMP, by modifications to the rules concerning Form 4506-T; Benefit Income; Verification of Monthly Gross Expenses; Wage or Salary Income; Self Employment Income; Rental Income; and Alimony, Separation Maintenance and Child Support.

To illustrate, now the requirement that a servicer must verify monthly gross expenses is removed and a servicer may just rely on a borrowers stated expenses. With respect to the other categories, the Supplemental Directive enables the servicer to "verify such income in accordance with the [...] documentation the servicer relies on when modifying loans held in its own portfolio..."

The extension is certainly welcomed as the foreclosure crisis is far from over. Also, these new rules are smart as they simplify an unnecessarily complex process, which has resulted in both lenders and borrowers being frozen in time when seeking to follow the rules. Instead, its expected that more decisions will be made whether to modify a loan based upon these changes.

HUD 2012 Housing Discrimination Study: Housing Discrimination Against Racial and Ethnic Minorities

HUD just issued its study of incidence and forms of discrimination experienced by black, Hispanic, and Asian renters and homebuyers.

The study finds that "minority homeseekers are told about and shown fewer homes and apartments than whites", as a result of more than 8,000 tests conducted in 28 metropolitan areas.

Clearly discrimination still exists in housing. However, the study takes pains to explain that differing circumstances of classes of people in housing does not equal discrimination. Instead, the discrimination is only present when it causes the resulting disability in housing.

Real estate agents should read the Executive Summary, understand discrimination and be mindful to weed out such practices as we always strive to bring professionalism to our field.

Credit Score and Old Credit Cards

We are often questioned about our advice at our Mortgage Mania class that its okay to cancel old credit cards. People say - Lieb you are wrong.

Well here is a Business Insider article by John Ulzheimer of SmartCredit.com that seems to agree with us. Have a read and decide for yourselves.