Americans tapped $8.3 billion in home equity -- the least in a decade.
Americans in the second quarter tapped the smallest amount of home equity in a decade, showing households are focused on repairing tattered finances.
To read the full story, please click the link below to the story from Bloomberg:
The Senate passed the financial regulation bill today, which will impact home buyers and lending guidelines. Chief among the changes impacting consumers is the creation a consumer bureau at the Federal Reserve and the requirement that lenders ensure a borrower is able to repay a home loan by verifying income, employment, and credit history.
MAKING SENSE OF THE STORY FOR CONSUMERS
Nearly 180,000 home buyers would have missed out on the tax credit had Congress and the president not taken action to extend the deadline to close escrow. Estimates from NAR show as many as 17,700 home buyers in California would not have received the tax credit without the extension.
The California Housing Finance Agency (CalHFA) announced that it will spend $420 million to trim individual mortgages by up to $50,000. Lenders will be asked to match the amount, a deal that could make thousands of mortgages newly affordable across California.
Amt available to troubled households: $700 million
Number of households expected to get help: 44,000
Max help per household: $50,000
Max mortgage amount: $729,750
Launch date: Nov. 1, 2010
Who's running it: California Housing Finance Agency, the state's affordable housing bank. CalHFA will add 10 staffers; it has budgeted $52.4 million, or 7.5 percent of the federal funds, for administration
Requirements: Must be a low- or moderate-income household and a primary residence. Limited to purchase loans, or possibly refi loans obtained to get a lower interest rate. No cash-out loans allowed. Not for investors.
THE PROGRAMS
Principal reduction: Borrowers who owe more than their homes are worth could receive up to $50,000 to reduce the amount they owe. Lenders would be urged to provide a match and perform a loan modification based on the new amount owed.
Amount budgeted: $420.6 million.
Mortgage reinstatement assistance: Borrowers would receive up to $15,000 to catch up on late payments. Lender would provide up to $15,000 and a loan modification to go forward.
Amount budgeted: $129.4 million.
Unemployment mortgage assistance: Borrowers could get $1,500 a month for six months to help make house payments (including principal, interest, taxes, insurance and homeowners association dues) while looking for work. Lenders would supplement.
Amount budgeted: $64.7 million.
Transition assistance: Borrowers will receive up to $5,000 to move if they can't afford their mortgage under any loan modification scenario.
Amount budgeted: $32.3 million.
