Count your pandemic-related mortgage blessings  

Time for the holiday season-celebrations, starting with the Thanksgiving kickoff festivities, with all its trimmings and blessings. Hanukkah lights it up early this year, with the first candle on Saturday night. A fast month later, Christmas and Kwanzaa calendar up.

This is when we pause to reflect, appreciate and congratulate ourselves, our communities, the mortgage lending industry and government leaders for the good stuff as it concerns your home, your family shelter, your sanctuary.

Here’s my list of top mortgage blessings to be thankful for:

1) The 2020 CARES Act: the U.S. government got the COVID-19 employment fallout and foreclosure threat right.

Cares brought badly needed liquidity to the mortgage markets so borrowers could knock down their mortgage rates and payments and pull cash out. Congress and President Trump, learning from the crushing Great Recession government missteps, granted mortgage payment forbearances for all needy borrowers with government-backed mortgages.

The roughly 7.8 million foreclosures suffered during the Great Recession and mortgage meltdown never materialized in the pandemic.

“How can you lose 22 million jobs in a recession and not have a big wave of foreclosures?” asked Rick Sharga, executive vice president of RealtyTrac. “Government intervention and a rapid recovery in the economy prevented 4 to 5 million unnecessary foreclosures.”

2) The number of borrowers getting back on their feet — that is, sheltering in place and making their mortgage payments again — is a relief. CARES Act and amended allowances allow up to 18 months of payment forbearance. As of Oct. 31, loans in forbearance decreased to 2.06% of all mortgages, or about 1 million homeowners, according to the Mortgage Bankers Association. Mortgage forbearances were at a high of 8.55% on June 22, 2020. That’s 4.3 million homeowners.

3) Late mortgage payments of 30 days or more dropped to 4.88% at the end of the third quarter of 2021, compared with 7.65% a year earlier, the MBA reported. For Q3 2021, there were just 45,517 U.S. properties with foreclosure filings — default notices, scheduled auctions or bank repossessions, according to RealtyTrac.

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4) Sandra Thompson, acting director of the Federal Housing Finance Agency (conservator and regulator for Fannie and Freddie) removed the nonsense one-half point adverse market refinance fee . For example, a fee of $2,500 on a $500,000 mortgage. Former Director Mark Calabria had imposed the fee on almost all Fannie and Freddie refinances on Dec. 1. Fannie and Freddie earned $5.3 billion from this money grab, according to a FHFA Inspector General report.

5) Mortgage rates remain low and stable despite inflation pressures. Yesterday, the 10-year Treasury, which is closely tracked by mortgage rates, closed at 1.67%. The average 30-year fixed rate averaged 3.1%, Freddie Mac reported this week. The last time we saw the 10-year at 1.67% was on April 8. Freddie rates were 3.13% at that time.

6) Around the outset of the pandemic, when self-employed borrowers needed mortgage giants Fannie Mae and Freddie Mac most, the FHFA mandated that Fannie and Freddie add ridiculously high and difficult approval standards for most of America’s self-employed borrowers.

But the so-called non-QM or …read more

Source:: Los Angeles Daily News

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