Consumerism Commentary - Latest Comments in Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

TwoCents — Thu, 26 Mar 2009 14:14:22 -0000

I believe the idea is to offer the 4% 30 year FIXED until the year 2011. At the end of two years, the offer for 4% is not required to be offered for new financing. Those who have acquired the 4% fixed, before the end of two year time limit, will remain at 4% for the fixed 30 year rate. How can a 30 year fixed be fixed if it is adjustable at the end of the two year offer period. A 30 year fixed can not be adjusted once it is in place.

The language of "encourage lenders" really does not change the current status of refinancing. They could offer a 4% 30 year fixed by having the borrower pay points to obtain it. They need to strengthen the language or change the wording to 'must offer, with no buy down points' or some wording to that effect. If there is a loop hole for our money grabbing banking industry to get around offering 4%, without lining their pockets, you can bet they will find and use it.

Just my two cents worth.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

steve — Thu, 26 Mar 2009 13:41:04 -0000

we need to have fha and other lenders more 40 and 50 year mortgages this would make homes more affordable, it would really help in california and other high priced areas.NOTE fha does not do 40 or fifty year mortgages. but it has a mortgage calculator that goes that high...

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Barry — Tue, 24 Feb 2009 11:57:57 -0000

I agree with you… I like your idea… I suggest you also promote this to everyone. I believe a cross the board reduction of mortgage rates to 3-4% would be fair to everyone. I have been and promoting this concept with emails to the media, letters to the administration, my senators and my representatives for months. It’s probably just coincidence but at least now, it now appears everyone is coming to the same conclusion- it’s taking hold. Hopefully, this translates to action which every one who has a mortgage and honestly has been making their payments will have the opportunity to benefit.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Robin — Tue, 24 Feb 2009 09:55:07 -0000

The plan should go a bit further. The government should create 10 year mortgages at 3% for people who haven’t had problems and want to accelerate their payments. In these mortgages, the principle and interest payments would be totally tax deductible. This would greatly stimulate spending in the near term and the government would ultimately increase its tax collections, once people have paid off their mortgages early.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Mike — Wed, 18 Feb 2009 08:56:00 -0000

I'm in the process of refinancing my 5/1 year ARM (5.5%), into a 30 year fixed rate at 4.875%. I close in a few days. I'm wondering if I should postpone closing until the government releases the details of the housing stimulus plan? If I pay >$2000 to refinance to 4.875%, I'll be very upset to find out the government has decided to hand out 4.0% mortgages. For these 4.0% mortgages, will people still have to pay closing costs to refinance? Maybe I'll postpone my closing for a week or so, hopefuly the details of the housing stimulus plan will be revealed by then.

As a side note, of course, I disagree with all the bailouts, and stimulus packages. It all smell of Socialism. This country is based on Capitolism, at least it used to be. Let the big banks and companies fail. Let home prices drop to rock bottom. Home prices are way to over inflated anyway. The economy will correct itself given enough time. Sure times will be tough for a while, but thats life. This country is way to greedy and materialistic. Its time we were set back a few notches. Things are getting out of control. Back to reality.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Barry — Thu, 12 Feb 2009 22:07:09 -0000

Hopefully this home mortgage change "is coming as part of the economic package that is supposed to be revealed shortly" Sec. Treasury said in his testimony this week.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Karl — Thu, 12 Feb 2009 18:19:23 -0000

No 4% fixed rate mortgage, no $15,000 tax credit for home buyers. What happened? I thought they wanted to fix the economy.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Matt_SF — Thu, 12 Feb 2009 16:42:26 -0000

Looks like we're going to subsidize mortgages instead of refinancing them. News of the plan surfaced today around 3:30 that home owners who can't pay the full balance on their monthly mortgage payment will receive federal assistance funds. Since 1 in 7 homeowners are underwater, this could be pretty big. Just one more way to screw over the people who played by the rules.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Carl Furr — Thu, 12 Feb 2009 16:34:05 -0000

Yeah, the 4% mortgage idea was dropped late last week. Unfortunate, as I thought it would be a good idea to get people back into real estate. Hopefully, the stimulus bill will get consumer confidence up again and we can start digging out of the recession hole.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

bluesbeans — Thu, 12 Feb 2009 14:37:42 -0000

Has the proposed 4% fixed rate mortgage idea been dropped from the Stimulus Package? I was hoping this would be a part of it. I don't see any mention of it in the last couple of days. Does anybody know if it has been totally dropped? Any info will be greatly appreciated.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Barry — Sat, 07 Feb 2009 19:45:47 -0000

The proposed 4% fixed rate should be limited to primary home morgages only, All homes with<$800,000 assessed tax value All new mortgages <$800,000 would be by application would require an investment ( 10%) down. Be credit worthy and demonstrate and varify sufficient income to support payments. No more for speculation! This is targeted directlty to provide relief to the middle class.

The new fixed rate could easily be implemented - applied in mass across the country - to all mortgages that meet the above critria. If this rate is adopted and stipulated at the federal level. No existing mortgages would need to be re-written or applied for. The financial services industry/banks then could easily implement this change quickly with simple code changes..

I believe this would immediatly give a kick start to the economy and provide a significant boost to middle class household income. Again, it stabilizes home values, reduce foreclosures and re-start consumer spending. = Jobs
If necessary they can use TARP money to initiate this. If anyone can advise me why this concept and idea is not feasable and fair.. I like to hear from you

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Carl Furr — Sat, 07 Feb 2009 09:20:49 -0000

We've done all the paperwork and appraisal to try to refinance. Once everything was completed, we've been waiting for rates to reach 4.5%(where they were in Dec) in our area. When talk of the 4% government backed mortgage began to circulate, mortgages began a slow climb to 5.25%. I read that the government will make up the difference between the 4% and the prevailing fair market mortgage rate. Does anybody else think they smell a rat here? It seems to me that banks have an incentive to raise 30 yr mortgages in the short run. Why not, as the government will be making up the difference in this spread! There just seems to me like no logical explanation for the increase in mortgage rates the past month. These rates are based on supply/demand and pretty sure that demand is at an all time low.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Kris — Sat, 07 Feb 2009 02:58:26 -0000

Why do you think this does not apply to home purchases? What part of the term "HOME BUYER" in your quote conveys that it's only valid for people who refinance?

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Barry — Thu, 05 Feb 2009 20:27:08 -0000

Many of you are missing the boat. I'm have been promoting this idea for months.
One of the prime reasons we are in this economic mess is the loss of liquidy by the middle class.. there is no money left for the average family to purchase goods or services. A disproportiate share of income now goes to servicing credit. The financial industry went from 808 billion to amost 3 trillion dollars in the five years. These large companies take more and more of family income by raising intrest and increasing fees as a primary goal to increase profitability in that is growing expotentially, Remeber they manufacture or produce nothing salable. They issue credit, process transactions and service your debt. Too many on both ends of the spectrum have gamed the system ( 45% of income growth has gone to less than 1%) on the other side people have been given credit for credit cards, teaser mortgages who never had sufficent income or some never intended to pay their debts. This is a house of cards and an abyss that is tittering on col lapse. I now have a very good mortgage and will likely not benefit from the proposed change. But honestly I believe that if this is adopted, it is fair to all, it does not reward the bad actors, it would stabilize the home values, let more people who are on the margin a greater opportunity to stay in their homes - reduce foreclosures. Also it will provide a steady stream of liquidy to again purchase goods and services. - much better then a one time check.. The average home mortgage will save between $300 - $500 per month.
If you believe this has some merit please add your voice/comments and pass it on to your represenatives.

Thank you in advance

Barry

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Rules Follower — Thu, 05 Feb 2009 17:52:14 -0000

I will be honest, this seems to be a reward for those who have been playing by the rules and for those who did not take the ARM or interest only mortgages. For months I have been upset with the talk of bailing out those who should not have been given mortgages in the first place. When I took out a mortgage on my house I had a good job with excellent credit so I got a 5.65% 30 year fixed rate mortgage instead of opting for a 5 year ARM or an interest only mortgage and rolling the dice. With all of the talk of dropping the interest rates and subsidising default property owners by dropping the principle amount was upsetting, I felt hey I should have rolled the dice and taken the ARM/Interest only and saved 5 years worth of difference in monthly payments. The 4% does make sense as long as it is administered properly. Make the funds available to new and existing homeowners but make sure that they are qualified by a revised set of standards. Must have a job, provide paperwork, tax returns etc.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Anonymous — Thu, 05 Feb 2009 14:51:04 -0000

Subsidizing lower mortgage rates would mostly benefit people with sufficient home equity and incomes. Homeowners with the greatest need may not qualify because of equity and debt ratios. Hopefully, the 4% target rate also applies to FHA loans.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

DahMan — Thu, 05 Feb 2009 04:03:06 -0000

My house value has dropped from $305,000 to $255,000. How much further do you want them to drop. Unfortunately for me, my first wife died from cancer, my second wife decided she loved my cash more than me and spent $112,000 of my line of credit, while I was out of state, before taking off. I went from owing $95,000 to $212,000. I could not refinance at 4.375% from 5.75% because my home equity dropped so much. With the high gas prices, food costs, increase in utilities costs and decrease in my investments; I do not have enough money to pay the closing costs on a decreased interest rate. And you want my home value to drop more. Thanks.

I agree, wait until my home value drops to $180,000 so the investors can buy it and get rich down the road. I'll starve before I sell for that little.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

DahMan — Thu, 05 Feb 2009 03:49:56 -0000

Don't worry folks. We will never see the 4% mortgage or any assistance with reduction or assistance with home loans. That would make too much sense. They will continue to hand out money to the big boys so they can line their pockets, throw more parties and take vacations on your dollar. When the world wide economy becomes this bad, look for World War III. That seems to be a great economic stimulus that has been used in the past to solve economic problems. Unfortunately, with our liberal citizenship we will roll over. You better start learning Chinese.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

DahMan — Thu, 05 Feb 2009 03:36:46 -0000

Why not cancel the $9,000,000,000 bailout. Zero to banks, nada to auto makers and zip to Wall Street. Send an immediate stimulus of $133,000 to every individual or family with a reported IRS net income of less than $133,825.13 last year. No strings attached. Suspend all sales tax for the six months on cars made by Ford, GM and Chrysler.

Show us the money and we will take care of the rest. I'll pay down my mortgage, buy a new GM vehicle and shop somewhere other than Good Will and WalMart. Trickle up will help the average Joe better than trickle down. It seems when we try the trickle down approach it gets absorbed by the big sponges at the top.

This may also help some of the illegal immigrants in our country but the government could set up a distribution point, hire some of the unemployed and have them check for citizenship before distribution of the funds. At the same time, a sweep of illegal citizens and deportation could take place which, as and end result, would save enough money from welfare, education, health and so forth that we could pay off the national debt in a few years.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

CP — Thu, 05 Feb 2009 01:03:20 -0000

Are you folks nuts! I have an average income and I would jump at the chance to refinance at a fixed 4%. I have a 30yr fixed at 5.875%. Refinancing at 4% for 15yrs would allow me to pay my home off years earlier without any increase in my monthly payment, not to mention saving myself over $150K in interest. I am happy with my 5.875 but anyone who thinks a 4% is only for "vulture investors" is a moron.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Sean — Wed, 04 Feb 2009 18:13:49 -0000

This is bogus info. I feel bad for everyone waiting because someone heard 4% on the grapevine. Remember two months ago when somebody at the treasury whispered 4.5% (http://money.cnn.com/2008/1... How'd that work out? Oh that's right...rates went up. I hope everyone waiting for 4% gets hosed and ends up at 6%.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Alias — Wed, 04 Feb 2009 17:26:44 -0000

Solve the foreclosures by extending the loans by 10 years. This would lower the
payments, financial institutions would collect the same interest, securing the fiancial market,
and people would still be in homes. US Census--average American moves
every 5 years, they will never use the extension, stabilize the markets and
everyone is happy again. Simplistic? Yes. Sometimes simple is the best solution,
and cost the taxpayers nothing.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

Writer's Coin — Tue, 03 Feb 2009 07:29:46 -0000

Wow. 4% fixed rate? This is perfect timing for my wife and I....we've been looking for our first place to buy (that we can afford—no easy task) since last year and right now we feel like we're in the driver's seat.

Throw in that kind of a deal and in 20 years we'll look back and say "We were in the right place at the right time."

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

SandraKay — Mon, 02 Feb 2009 17:48:26 -0000

We are scheduled to close escrow on a house in the next couple of weeks. Any idea how quickly the 4% interest rates would be applicable? Would any house purchase in 2009 be eligible? Any info would be appreciated.

Re: Senate Amendment to 2009 Stimulus Bill: 4% Fixed-Rate Mortgage

fenwah — Mon, 02 Feb 2009 16:38:02 -0000

Actually I've read where they will give to HOME BUYERS as well as homeowners wanting to REFINANCE

Create a 4% mortgage: Senate Republicans are likely to introduce a provision that would encourage lenders to offer a 30-year fixed rate mortgage at 4% for a limited period of time. The loans would only be available to credit-worthy home buyers and homeowners seeking to refinance.