Shirley Kistler's Real Estate Blog: Serving your Real Estate Needs in Sacramento, Placer and El Dorado Counties

The U.S. Treasury released statistics the end of July, 2010 for the Home Affordable Modification Program (HAMP) program.  The statistics showed that loans that have been permanently modified had a re-default rate to be around 2% – 5.9% 60 or more days past due after modification and 1.7% 90 or more days delinquent.  When those statistics came out, they received a huge outcry from analysts questioning the validity of these statistics. 

The Treasury pulled the numbers and re-evaluated the statistics after retaining a third-party consultant to provide independent validation.  A few weeks later, they corrected the re-default assessments as follows:  10% of six month old permanent modifications are 60+ days delinquent and 6% are 90+ days delinquent. 

Analysts say that’s still too low and the rates will surely go higher the longer the program is in place.  Up until six months ago, permanent modifications had been offered to only about 434,716 borrowers.  The Treasury has cancelled the temporary modifications of 616,839 borrowers. 

The analysts at Barclays are predicting a 60% re-default rate and Fitch Ratings projects 55-75%. 
 http://www.dsnews.com/articles/print-vie…

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• HAMP: Still fundamentally broken  hsh.com)
• Treasury Correction: Modified Mortgages Perform Less Favorably  blogs.wsj.com)
• Bank of America Permanent HAMP Modifications Increase 5.9% in July  housingwire.com)

Are you still on the fence trying to decide whether to keep on renting or take the leap into home ownership?   You may never again experience these low home prices combined with the lowest interest rates ever again.     Check out this handy calculator to help you see the advantages of home ownership. (CLICK HERE)  

If you are still unsure, you should contact a REALTOR to discuss the advantages of purchasing a home and find out how much of a loan you can qualify for. 

Don’t be left sitting on the fence saying should’ve…..would’ve…..could’ve  Act now and contact your Real Estate specialist.

In the past 32 years working in the real estate industry, I have not experienced a 4-1/2 % interest rate on a 30-year fixed rate loan.   It is time to give a lot of thought to purchasing a  home in this market. 

Are you concerned that  home values may decline?   

Sure, it is possible but will you ever see 4-1/2% again?   That equates to $450 for every $100,000 in the purchase price of your home.  Can you rent for that monthly payment?  I doubt it.  Lets also not forget the tax benefits of owning your own home and the freedom of making your house a home for you and family.

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• Advantages to Buying a House with your Hard-Earned Money  homeloans.org)