Bill Aimed at Helping Underwater Homeowners Gains Support

I’m pleased to report the following “three things” happening for the benefit of us all.

I’m passing this along because I feel this is one action that should have been done years ago. While writing my first book warning people of bad loans and the pending financial crisis in 2006, I shared with hundreds of people that the government could just be pro active and reach out to millions of Americans with adjustable loans or negative amortizations loans (bad loans) and pro actively refinance them into low rate fixed mortgages to stem the disaster and save the falling home values. Now finally, they are considering something similar. But before you get all excited, there are stipulations…of course and it hasn’t happened yet.

The Helping Responsible Homeowners Act (S. 170), which aims to help underwater homeowners refinance their loans at historically low interest rates, is gaining support. The Helping Responsible Homeowners Act would eliminate current barriers blocking millions of non-delinquent homeowners from refinancing their mortgages at historically low interest rates. The refinancing options Fannie Mae and Freddie Mac currently offer these homeowners come with high, up-front, risk-based fees – up to two percent of the loan amount – making them largely unpopular. There are also specific guidelines for the LTV of these loans limiting millions of people who are severely upside down as many are in the western states.

The proposed legislation would eliminate these fees for loans for which Fannie Mae and Freddie Mac already bear the risk. The bill also aims to remove refinancing limits on underwater mortgages and allow these homeowners to receive interest rates comparable to other borrowers. While mortgage rates remain historically low – below 5 percent – more than 8 million homeowners with loans guaranteed by Fannie and Freddie maintain rates at or above 6 percent. There would obviously be a significant cost to the government as lenders will not bear the burden themselves. This should have been done years ago and would have actually cost less than the first multi-billion dollar bailout! With the current budget stalemate, it is unlikely we will see this anytime soon.

This legislation would help millions of responsible homeowners who are making their payments, but are still struggling. It is believed that by helping these homeowners refinance at lower rates, we will put thousands of dollars back in the pockets of families, strengthen our economy and stop the value decline.

THE NEW Bureau of Consumer Financial Protection (CFPB)

The Bureau of Consumer Financial Protection (CFPB) operational in July 2011, will be an independent bureau within the Federal Reserve System that will help empower consumers with the information they need to make financial decisions that are best for them and their families.  Created by the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), the CFPB will work to promote fairness and transparency for mortgages, credit cards, and other consumer financial products and services. The CFPB will set and enforce clear, consistent rules that allow banks and other consumer financial services providers to compete on a level playing field and that let consumers see clearly the costs and features of products and services.

Recently an article suggested that anyone could contact the CFPB to provide meaningful suggestions on how to help fix the financial sector and protect consumers. I have tried to find a direct contact with no luck as of yet. If anyone can find a direct contact I would appreciate it if you could pass it along.

MARS Stipulations No Longer Enforced 

The Federal Trade Commission will no longer enforce most provisions set forth in the Mortgage Assistance Relief Services (MARS) Rule, according to a statement released Friday. The MARS Rule required real estate agents to make several disclosures when assisting distressed homeowners in obtaining short sales from their lenders or servicers.

The rule also banned advance fee collection and prohibited false or misleading statements. After the Rule was enacted by Congress in 2009, several real estate agents complained that the disclosures often confused homeowners or misled them. While 360 Group has never charged an up front fee and will never agree with firms who do so, we have been in the “thick” of the financial crisis helping homeowners navigate the banks games. Charging a fee fraudulently for delivering no value or service should be punishable with jail time, but making people get licensed doesn’t address the real problem which is simply ignorance. We educate for hours, days even weeks before we collect any fee.

“As more and more American homeowners seek short sales, it is especially important that the Rule not inadvertently discourage real estate professionals from helping consumers with these types of transactions,” the FTC stated. The MARS Rule required real estate agents to state that they are not associated with the government, nor have their services been approved by the government or the homeowner’s lender; the lender may choose not to alter the homeowner’s loan; and if a company tells a homeowner to stop making mortgage payments, they must warn them that they could lose their home or damage their credit rating. Real estate agents who are in good standing under state licensing requirements, in compliance with state real estate laws, and assisting homeowners in obtaining short sales are no longer required to provide the MARS disclosures.

If you know someone who needs objective advice at no cost, we’re here. Dont hesitate to contact us. Empowering Consumers is at and also at