A new law passed by the Federal Government has created a permanent ban on banks getting into the real estate brokerage and management business. At stake was banks' desire to house mortgage lending and a real estate brokerage under the same umbrella, creating a one-stop-shop for real estate transactions.
The new law probably makes sense in the long-term, although there are some efficiencies that may have been created by a few of these companies. Think about ending the countless phone calls and faxes between lenders, agents, and buyers/sellers to transfer documentation. These large companies could surely have saved us some time, some paperwork, and just plain old paper.
Despite those possibilities, the consumer safeguards in this law win out, and there is a better competitive marketplace when more companies are competing for your dollar. With the scrutiny placed on banking in our current financial state, it doesn't make sense to allow greater control of these transactions by one entity.
Showing posts with label government. Show all posts
Showing posts with label government. Show all posts
Saturday, March 14, 2009
Thursday, March 5, 2009
A Mortgage Bailout for Responsible Homeowners? Maybe...
The mortgage bailout and foreclosure rescue from the federal government has elicited a lot of emotion. Many homeowners have complained that they have been struggling to pay their mortgage on time and that they shouldn't have to bail out those that have stopped paying.
Help *may* be on the way. As new details of the Housing Affordability and Stabiliy Plan emerge, it seems that homeowners who are current on their mortgage will be eligible for the plan. If their mortgage is with FNMA or FHMC, and they are less than 5% "under water", they can qualify. They do, however, have to show an imminent hardship that will make it hard for them to continue paying on time.
The big questions: What will constitute a "hardship", and what percentage of this money will actually be available to homeowners who are current? Would it make more sense to reward those who are still current, as they are the least likely to walk away from their homes in one year from now? Would it create too much of a subjective process and a mountain of paperwork to determine who is truly challenged financially? Surely it's easier to say "This person isn't paying on time, they qualify." That doesn't mean it makes the most sense.
No question, there will be a landslide of people applying. Details of the plan are ever-changing, so you can keep your fingers crossed, but don't get too excited yet.
Help *may* be on the way. As new details of the Housing Affordability and Stabiliy Plan emerge, it seems that homeowners who are current on their mortgage will be eligible for the plan. If their mortgage is with FNMA or FHMC, and they are less than 5% "under water", they can qualify. They do, however, have to show an imminent hardship that will make it hard for them to continue paying on time.
The big questions: What will constitute a "hardship", and what percentage of this money will actually be available to homeowners who are current? Would it make more sense to reward those who are still current, as they are the least likely to walk away from their homes in one year from now? Would it create too much of a subjective process and a mountain of paperwork to determine who is truly challenged financially? Surely it's easier to say "This person isn't paying on time, they qualify." That doesn't mean it makes the most sense.
No question, there will be a landslide of people applying. Details of the plan are ever-changing, so you can keep your fingers crossed, but don't get too excited yet.
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