The One Key to Help Congress Solve the Housing and Foreclosure Crisis According to CMPS Institute
Ann Arbor, MI, (PRWEB) April 22, 2008 -- The CMPS Institute has just sent Congress a detailed proposal calling for government-backed loans to homeowners (http://www.cmpsinstitute.org/pdf/MortgageSubstitutionProposal.pdf) of up to 20 percent of the homeowner's current mortgage balance.
"Negative homeowner equity is the one root problem that Congress can help solve," said Gibran Nicholas, Chairman of the CMPS Institute, an organization that certifies mortgage bankers and brokers. "If homeowners have no incentive to keep up their mortgage payments, the problems in the housing markets could continue to spread and plunge our country into a deep recession."
This proposal was initially floated by economist Martin Feldstein (http://online.wsj.com/article/SB120485260049218269.html), chairman of the Council of Economic Advisers under President Reagan, professor at Harvard University and President/CEO of the National Bureau of Economic Research. "A voluntary loan-substitution program could reduce the number of defaults and dampen the decline in house prices - without violating contracts, bailing out lenders or borrowers, or increasing government spending," said Feldstein, who helped review the comments sent to Congress by the CMPS Institute.
About six percent of all mortgage borrowers are behind on their payments, and 17 percent of all sub-prime borrowers are behind on their payments. Approximately 10 percent of all U.S. mortgage borrowers owe more on their mortgages than the value of their homes, thus making their mortgages "unrefinanceable" for the most part. "Some of the more aggressive proposals before Congress would drive the mortgage industry toward nationalization, while some of the more limited proposals would do little or nothing to solve the crisis," Nicholas said.
"This entire situation can be greatly remedied by reducing homeowners' mortgage balances to the point where they are no longer in a situation of little or no equity," said Nicholas. Doing so would give all homeowners incentives to keep up their mortgage payments as property values continue to stagnate or decline. Distressed homeowners would be empowered to refinance their otherwise "unrefinanceable" mortgages into more affordable loans without an increase in their overall debt level. Property values will stabilize, consumer confidence will rise to shore up the economy and taxpayers will avoid incurring unnecessary and excessive risk.
Please review CMPS' comments (http://www.cmpsinstitute.org/pdf/MortgageSubstitutionProposal.pdf) and let Congress know your thoughts on the matter as well. The best way to communicate with the committees is by fax:
* House Committee on Financial Services, Attn: Congressman Barney Frank, 202-225-6952
* Senate Committee on Banking, Housing and Urban Affairs, Attn. Chairman Dodd, 202-224-5137
In your fax, you could simply state, "I urge Congress to consider the Mortgage Substitution Proposal submitted by the CMPS Institute which can be found at http://www.cmpsinstitute.org/pdf/MortgageSubstitutionProposal.pdf."
About CMPS Institute (http://www.cmpsinstitute.org/):
CMPS is a training, examination, certification and ongoing membership program for financial professionals who provide mortgage and real estate equity advice. The CMPS Institute was formed as a joint effort by leaders in the mortgage and financial planning industries to raise professional standards among mortgage professionals and integrate sound financial planning advice into the mortgage process (http://www.cmpsinstitute.org/public/mortgage_planning). Recognized for its preeminence within the industry, the CMPS curriculum represents the core knowledge expected of residential mortgage advisors, regardless of the diversity of specializations within the industry. For more information or to locate a certified professional near you, please visit www.CMPSInstitute.org or call 888.608.9800.
Press Contact:
Josephine Nicholas
josephine @ cmpsinstitute.org
CMPS Institute
888-608-9800, ext. 102
###
Related Articles:
Does "Subject to" Financing Work with a Foreclosure?
"Subject to" financing is where a homeowner sells his home but leaves the existing financing in place and allows the new owner to continue making the monthly payments. The deed is always transferred at this time to another owner who will be making the payments. Early in the 1980's, lending institutions got legislation passed that stopped loans from being fully assumable by new buyers because the lenders could charge additional closing fees.
Effective Real Estate Foreclosure Investing
Foreclosure loans are those loans, which are god gifted divine water (nectar) for those who are ill affected by foreclosure. If you are facing a pecuniary hardship and the bills and mortgage payments getting behind you then foreclosure loans is still a hope. Some options yet, to protect your home from foreclosure. Still you have hoped to prevent foreclosure by owing a foreclosure loan. Providing valuable information and resources how to manage the debt and pull down foreclose.
Distressed Properties: Investing In Foreclosure And REO Houses
Distressed properties are predicted to become the next hot real estate market, but can investors really make money buying fixer-upper houses According to housing experts, the answer is a resonant "Yes"
Home Loans and Mortgages – Tips to Avoid Foreclosure
Today's real estate market is a volatile one; prices are at record levels and Interest rates are favorable, but foreclosures are increasing. Wages haven't kept up with home prices and some buyers who had to stretch to find a way to obtain a mortgage in the first place are having trouble making their payments.
Foreclosure business with its incredible outcome
Foreclosure is a legal proceeding by which the county enforces payment of real property taxes. The county acquires legal title to a property if the taxes aren?t paid by a certain date. Generally real property is normally subject to foreclosure three years after the taxes become delinquent. List of all the properties on which the taxes are not been paid subjected to foreclosure and is mostly prepared in July of each years for accounts with property taxes of three years delinquent. If a certain property is subject to foreclosure then lien holders may ask for the notification. One month after the list is announced, the district attorney subject that list to judgment and decree to the court. The notification of the f...
Getting Started in Real Estate Foreclosure Investing
Decide to Invest in Real Estate Foreclosure InvestingWith the increase in Real Estate property appreciation rates across America, a prospective foreclosure buyer may want to fix up a property to improve its value to live in, to rent out or to resell. The strategy a buyer pursues will determine which foreclosure property to buy and the location.
Real Estate Foreclosure Services - Arizona Short Sale Office Offers Foreclosure Help To Home Owners
Arizona Short Sale Offices Offers Home Owners Real Estate Solutions For Alternatives To Foreclosure. Behind on Payments, auction date has been set, owners of real estate has options to stay in your home. Phoenix Foreclosure Assistance is Available through the Arizona Short Sale Office which offers government assistance through FHA secure programs.