In a surprising move, Fannie Mae announced its new programs to make it easier for consumers to qualify to be first time home buyers, or pay off their student loans via a refinance. The new program is called Student Loan Solutions. This is undoubtedly fantastic news for Americans who hold some of the $1.4 trillion in student loan debt. Effective immediately, Fannie Mae is easing the home loan process with three major changes so that becoming home buyers or reducing student loan debt may become a reality. Change #1: Student Loan Payment Calculation Fannie Mae has changed how lenders calculate student loan payments. Whereas before the change, mortgage lenders had to use 1% of the outstanding balance or the fully amortizing repayment amount, now lenders can calculate debt to income ratio (DTI) based on the student loan payment just as it appears in the credit report. This is good news for borrowers on an income-driven repayment (IDR) plan such as PAYE and REPAYE. Change #2: Student Debt Paid By Others In the case that a parent or other third party pays the bill, Fannie Mae is disregarding the payment altogether. That applies not only to student loans, but payments for […]
The U.S. Treasury has received billions in profit from post-crisis Fannie Mae and Freddie Mac revenues – and investors are suing for it. For decades, Fannie Mae and Freddie Mac helped in causing a steady rise in home buyers—until the subprime crisis hit and Fannie and Freddie were on the hook for billions in losses. Legislators swore to reorganize the two companies and some planned to phase them out entirely. However, over eight years later, Fannie and Freddie still operate under government control—and they’re now a bigger part of the system, guaranteeing payment on nearly 50% of all U.S. mortgages, an increase from 38% before the crisis. There is one crucial difference: Any profits the companies generate go to the government instead of investors. In 2012 the government altered the terms to say that every quarter Fannie and Freddie would send Treasury all their profits except for a certain amount of money kept in reserve. That reserve started at $3 billion in 2013 and was scheduled to fall by $600 million every subsequent year, until hitting zero in 2018. The latest payment, a combined $9.9 billion to the U.S. Treasury at the end of March, made the total amount of […]
With home prices that are rising faster than incomes and mortgage rates nearly three-quarters of a point higher than just a few months ago, new borrowers are on the hunt for the best deal they can get on home loans.
Consumer spending fell short of January’s projections as rising prices hit Americans where they feel it most – the wallet. As a result, leading inflation-adjusted purchases dropped by the largest margin since September of 2009 when it sank a full 1%. The 0.2% advance in spending followed a 0.5% increase in the prior month, the Commerce Department reported on Wednesday in Washington.
Mounting consumer consciousness and demand for sustainable, green properties is spurring an exchange of ideas between Realtors® and homebuyers and sellers. Over 50% of Realtors® find that consumers are interested in real estate sustainability issues and practices, according to the National Association of Realtors®’ (NAR) recent REALTORS® and Sustainability report.
Markets are more confident that there is a 94% likelihood of a rate hike this month, up from 40% a week ago. Much talk has been had about the possibility of a rate spike in March and as the time looms closer, evidence shows that the probability is ever more likely. Janet Yellen, Chairman of the U.S. Federal Reserve, has given the strongest indication to date that policymakers will indeed raise interest rates this month.