URGENT NOTICE: Fannie Mae and Freddie Mac Foreclosure Freeze | Realtor REO Coaching and Training | How to List REOs

As predicted, expect to see more foreclosure moratoriums…typically for 90 days. California tried this and..it didn’t have any sort of significant effect. Expect to see a massive number of foreclosures hit the market after this artificial reprise….

Mortgage finance companies Fannie Mae and Freddie Mac are suspending foreclosures for about 16,000 households during the holiday season.

The two companies said Thursday that they will halt foreclosure sales between Nov. 26 and Jan. 9, while they evaluate whether borrowers qualify for a new loan modification program announced last week.

As you may recall when the government seized Indymac back the FDIC implemented their own “Mortgage Loan Modification” program. Overall, very few loans were actually modified as a percent of the whole.  Now we are seeing that even after the homeowners have had their mortgages modified they are still missing payments. Loan Mods are a great solution in theory. But, the newest research about what happens post loan modification isn’t encouraging. Clearly, simply massive numbers of homes will become REO listings. Learn now how to become a REO, Bank Owned Homes Listing Agent. Instant Free Agent REO Secrets book.

Fannie Mae said about 10,000 households would be affected, while Freddie Mac said the changes would affect about 6,000 borrowers who are facing foreclosure. The change does not apply to vacant homes.

Realtors, read that again….only 16,000 borrowers would be ‘affected’….that’s assuming they want to do a loan modification. Remember, a loan modification temporarily makes the payment lower….rarely, are there any principle reductions. In other words, they are still upside down in their homes. If they want to sell..and they don’t want a foreclosure on their credit one of their best options is doing a short sale. Realtors, learn how to offer these extremely motivated Sellers the option Short Selling their homes. Download the Free Agent Short Sale Secrets book now.

OK, you will love this next part…..in order to qualify for this new initiative a borrower has to miss 3 mortgage payment….

Fannie and Freddie’s loan modification plan aims to help abate the foreclosure crisis by aiding homeowners who have fallen at least three months behind on their payments, but only if their loans are held by the two companies.

More fun facts….when I first read this next point a week or so ago I thought it was a misprint. Can we all agree that one of the (many) reasons we are in this immense real estate mess is because lenders gave mortgages to people who didn’t qualify? Assuming we are in agreement…then WHY the heck is it that the FHA is now allowing people to have mortgages with a 38% housing ratio? Get this, the actual housing debt to income ratio that the FHA uses is………..28%. So, the FHA is now becoming the worlds largest….SUB-PRIME lender!

Under the program, the new primary mortgage payments — including taxes and insurance _shouldn’t total more than 38 percent of homeowners’ pretax monthly income.

It very important that you read and clearly understand the next point…THIS year…2008…the NAR is estimating that there will be around 5 million home sales….the FDIC is expecting that by the end of THIS year…2008 there will be 4.4 MILLION borrowers who are deliquent on their mortgages. If you are a HREU Coaching Student you know that the best opportunities for helping the millions (and millions) of homeowners is still ahead of us. Start now by learning how to become a REO (bank owned homes) listing agent. If the government predictions are correct nearly 50% of ALL sales in 2009 will be REOs and Shortsales.

Download the Free Agent REO Secrets guide book Now. Instant Free Download.

Fannie and Freddie are the dominant players in the U.S. mortgage market but hold only 20 percent of delinquent loans. Ultimately about 400,000 households are likely to qualify for the loan modification program, according to Priya Misra, a mortgage analyst with Barclays Capital.

By contrast, the Federal Deposit Insurance Corp. estimates that more than 4.4 million borrowers will become delinquent by the end of next year, not including loans backed by Fannie and Freddie.

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