FHA approves restructure of existing home loans in default, extending mortgage terms to 40 years, allowing mortgagees to further reduce monthly payments. This and more in our housing market update.
#housingmarketcrash #realestatenews #mortgagenews
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BAILOUT: FHA APPROVES 40 YEAR MORTGAGE (Housing Market Update)
In recent news, the Federal Housing Administration (FHA) has given its approval for the introduction of a new 40-year mortgage option. This decision comes as a response to the ongoing challenges faced by homeowners and potential buyers due to the economic fallout caused by the pandemic. The extended loan term aims to provide more affordable and flexible financing for individuals looking to purchase a home in the current housing market.
The FHA, a government agency that provides mortgage insurance on loans made by FHA-approved lenders, has always been at the forefront of supporting homeownership opportunities for Americans. With the unpredictable nature of the housing market and the increasing prices of residential properties, this new mortgage option brings some much-needed relief for struggling borrowers.
The introduction of a 40-year mortgage term means that monthly mortgage payments will be lower compared to traditional 30-year mortgages. This extended timeline allows homebuyers to spread out their payments over a more extended period, making it easier to manage their finances and potentially qualify for a larger loan amount. The reduced monthly payments could open doors for many individuals who were struggling to meet the requirements of a 30-year mortgage previously.
While the extended mortgage term offers some clear benefits for potential buyers, it is crucial to consider its implications in the long run. A 40-year mortgage may result in higher overall interest payments as borrowers will be paying back their loans over a more extended period. It is important for prospective homeowners to carefully analyze their financial situation, long-term goals, and consult with financial advisors before making a decision.
Another aspect that should be kept in mind is the impact on the housing market as a whole. The introduction of the new mortgage term could potentially lead to an increased demand for housing. As more buyers qualify for larger loans due to reduced monthly payments, the increased demand might drive up home prices even further. This could create challenges for first-time homebuyers as affordability remains a significant concern in many parts of the country.
However, it is essential to note that the implementation of the 40-year mortgage option by the FHA is just one of the many initiatives being taken to address the housing market’s current challenges. Steps are being taken at various levels to increase the supply of affordable housing, stimulate new construction projects, and provide financial assistance to those in need.
The approval of the 40-year mortgage by the FHA is undoubtedly a significant development that aims to alleviate some of the burdens faced by potential homeowners. By expanding the range of options available to borrowers, it allows more individuals to participate in the homeownership dream. Nonetheless, it is essential to thoroughly assess one’s financial situation and weigh the long-term implications before opting for this extended mortgage term.
As the housing market continues to evolve and adapt to the changing socio-economic landscape, it is crucial to stay informed and seek professional advice when making important financial decisions. The 40-year mortgage approval by the FHA signifies the willingness of the government to explore new avenues to support homeownership, but it is up to individuals to make informed choices that align with their specific circumstances and long-term plans.
Mortgage lending is not a one size fits all kit you can apply to the wound! When you deduct all payments equally to satisfy the loan why are maturity dates often missing payments? Most estates have equitable credit and the loan maturity because no one can do math doesn't even match with the remaining payments. So why would you force someone to borrow on your interest which is tantamount to paying interest on interest on interest? The loan never gets paid off! It should be illegal to charge interest on interest payments when a person has pretty much paid down all the interest portion of the loan and has achieved over 45% pay down on the mortgage ? You can't tell me instead of lowering the interest rate after that much of a pay down and charging them 10 to 20 or 30 years more and resetting the loan is even remotely in the customers favor…your hijacking consumer interest with no valid reputable cause or reason other than to line your greedy pockets! And on top of that you never loan them one red cent to fix the house! How can you even call this a mortgage industry? This is just capital for hijacking because you can license and call yourself a broker! It's abominable and needs Congress to regulate! Extending a mortgage without understanding the cause and effect of the conditions of the home is just extortion for money when the lender doesn't fix it, they want you to put your money in on sweat equity then steal the proceeds! Mortgages never used to work like that..but now they do? So no one will ever pay themselves to invest into fixing or maintaining a home because you'll just steal it on foreclosures! You're shooting yourself in the foot! I can't even understand how so many of these homes have such high cost with zero improvements! How is it legal to inflate the cost of something broken or condemnable? Something the mortgage company will not do to maintain their own interest such as fix it? No one in their right mind will place separate liens and loans for even higher percentage rates to accomplish this, people must be out of their minds!
You could lend at 1% across the board but their expenditure are floaters with self entitlement and they put the consumer to the wayside thinking they can contract and do better jobs than the consumer fixing the house…so it's more like an LLC just granting themselves permission to run your estate by taking percentage but the will not loan any money out to service the mortgage, they take all the equity and place more interest on the equity and never service the lender except for embezzling funds if you ask me. Most mortgage companies to me are breached in contractually obligating lending to them for reasonable rates but market manipulation screwed that up for them…money is gone and they just want the longest terms and highest percentages back in interest back …to me it's fraud!
People are unreasonable with greed is the problem and they know they can lend at 1% but when you're involved in ponzi lending that isn't going to happen..ever! The stock brokers holding these properties don't care if they break America's back, neither does Congress because these are the people holding the mortgages.
They're not doing people any favors by giving them more time to pay a mortgage. Financial policy and financial habits by people in this country are getting worse and worse. A 30-year mortgage is too much IMO. The fact of the matter is buyers are allowing it by participating in this madness. It's the instant gratification epidemic. Doing something stupid in the present that makes no long-term sense. Then the government bails them out.
I want to buy a house in a better school district for my young kids, but I know the prices are too high. Everything about me tells me not to. I'm convinced this is not sustainable and the prices will come down, but every time I turn around I see that people are continuing to overpay.
Everyone nowadays is chasing a dollar and no one cares about the next person. Meanwhile, we're all sinking in the same ship.
I have never had a mortgage yet I own three properties in Hawaii.
More Boomer policies to avoid a crash until it's the next generation's problem.
What are they going to do about the legality of reverse mortgages? As an heir and resident of 40 years, COVID comes along and my home is getting stolen away from me. Because I was in restaurant business my revenue crumbled and collapsed Now I am getting thrown on to the streets. No place to go Hud counseling was a joke.
There suggestion is move somewhere cheaper. It isn't how expensive its they want to steal my home away from me because they think It will be good profit. something they havent seen much of.
Of course we are not a Democracy, never have been. The Founding Fathers were very clear that they established a Republic. However I also remember when most everything was made in America. The Bankster's Globalist Cabal was designed to trap and enslave the world in their Babylonian Debt Finance System. I moved out of everything priced in the not Federal, not Reserve, Federal Reserve Note. I put my money in the best performing asset. Gold/Silver. Physical Gold/Silver, God's money, held in your possession, has no counter party risk. I sleep like a baby. Wait 18 – 24 months and buy cheap when blood is in the streets.
What do I know? I'm just an old guy. Don't listen to me.
Blessings on you.
40 years why not make it 50 years?
This channel is brilliant..suscribed
Now you can buy a 500k house and only have to pay 1.5million for it!
Maybe they need to like ban institutions from scooping up houses and reserve a certain amount of the housing stock for first time home buyers that intend to live in the home for the length of the mortgage. Stop people from coming in with Cash and scooping up all these properties while the interest rates are high but the overall prices are dropping lower.
40 years a great idea when you are in your 50s/60s. Pay for 10 or 20 years. When you are dead you don't care what happens
So weird that I worked my butt off so I would never have to deal with a 30 year mortgage (I paid a crap ton and got a 15 year fixed) only to have a 40 year mortgage come to fruition. Do people not look at their amortization schedules showing principle vs interest?
Things will never get better for the average american until landlords are banned from buying single family homes.
"Made in USA" means nothing to me because people are so lazy and entitled now days that I don't trust products made here over products made over seas.
40yr loans seems like a debt plague that ppl will never get out of..financing that long May seem attractive cause of lower payments but the inevitable of paying interest past it’s worth will not help ppl build their wealth smh millennials are screwed for sure lol
If we go back to making nation based products vs offshoring and outsourcing, we would have more liquidity in the market. That's just my two cents.
40 years of mortgage payment is a death sentence.
Do you honestly believe during 40 years you will not have a financial emergency? That the banking/financial system will not have a crisis and you lose all your equity? Who would roll the dice on a 40 year bet?
I work in mortgage default and they’ve been approving 40 year mods to compensate for the high interest rates. Instead of just leaving people’s interest rates as is, they’re adding 10 more years.
I must say – Melissa carries such grace!!! She is just a joy on the screen to watch!
Financial engineering
House is NOT a depreciating asset. It is depreciated only on the paper as a tax deduction
It’s not new but not actually normal
Boy, I can't get over that cheap suit!
Definitely not doing that I would rather rent forever
What’s driving is corporate cash buyers driving up prices all across the country. You get cash buyers to buy three places around a neighborhood that’s 100% higher then suddenly houses that couldn’t appraise for these numbers before all cash buyers are now going for twice to three times higher that they aren’t worth now going for that number. A 40 year loan won’t change the fate. On a 200k loan on 40 year term only lowers the monthly less than $70 a month. You pay 1360 a month at 30 years or 1290 at 40 year. If $70 a month is the difference from default or being able to afford, you shouldn’t be buying. It’s a horrible idea. The cost of upkeep alone you need 300 a month set aside for the bug fix it’s.
The productivity to salary ratio is the lowest it’s ever been. We’re the most productive generation and also the least paid. This guys generation is the ones in charge, but I’m not sure who he’s pointing the finger at for why the structure has deteriorated. We need a transfer of wealth from boomers who can’t even use a smartphone, let alone operate a modern company infrastructure
Buy don't rent, I got my house for 900 a month locked in rate, rentals are now reaching 2000 bucks and I'm still paying 900…
Yeah homes don't depreciate… I have the worst type too a manufactured home and my home doubled since I bought it. Also buy a house no matter what if you are thinking about renting.
The avg American has an avg of $5,000 in the bank with a mean threshold of $41,000. The avg business bank balance across America is $71,000 This means most Americans have well below the FDIC limits making the protected. That means the bail out from the federal government was towards the wealthy 1%. We can’t talk about this bail out from the context of helping the avg American but the wealthy American.
Active listings are at an all time low, and demand is there to maintain prices and even go higher when more buyers come to the market when rates come down. Mortgage rates follow inflation, as the fed tackles inflation rates will come down and more buyers will come to the market where there is a limited supply.
A house mortgage should be no more then 10 years and a car should only finance up to 3 years. This is the real problem but nobody cares. Everything is over priced and people are not getting paid enough. The government and the bankers are working together to keep the common man and women down.
Barely anyone is accepting FHA loans anyway. I went to conventional and honestly it’s cheaper. Consider the mortgage insurance on FHA that doesn’t go away for the life of the loan and it’s more expensive monthly. Conventional loan goes away at 20% equity and is cheaper.
Homes are a liability. Buy land.
Enter fed coin. “No risk” to keep your money with the money printer
40 year loan? At the new rate? Will it even be worth it?
So FHA loans if they have have mortgage insurance it never goes away from the loan, unlike conventional that will drop off after 80/20 or you can get an appraisal and get it removed. FHA loans though are there for the length of the loan so 40 year loans are just more %$$$$ for the government
Cool I'll be able to own my home at the reasonable age of 80
10:27 of course the work ethic is lower, the workers are having to work 2 or 3 jobs to survive.
Why not just provide everyone with housing? They bail out banks, how about bailing out the people that you actually work for?
Don't give me the tripe about capitalism or freedom, this Country has been lost to the mouth breathers and is pure socialism.
Either stop buying the American dream, or accept it. It's your only choice.
Pay cash and watch the banks scramble to lower interest rates.
How many bandaids before a full-on collapse…
What are you talking about? A house appreciates in value over time.
It's about affordability. This guy is missing the point.
40 year mortgages just means people will pay more interest on their house. And, they're banking on people not being smart enough to realize this.
If someone wants to throw away their money to pay extra interest, then let them.
the depositors who keep more than 250k are investing in a bank. and they are the richest segments of society. the banks will take their fees to cover those extra balances from the rest of us.
How long can you provide bailouts until you can't? How long can you postpone "the day of reckoning"? How long can you print make-believe money to an American culture that is deteriorating?