Yesterday, President Obama signed the Helping Families Save Their Homes Act of 2009 (S.896) into law. The goals of this law are to prevent mortgage foreclosures and enhance mortgage credit availability.
Some of the highlights are listed below. The law:
- Improves the Federal Housing Administration’s (FHA) Hope for Homeowners program, by reducing the program fees and streamlining borrower certification requirements. It also allows the the Department of Housing and Urban Development to make incentive payments to participating loan servicers and originators.
- Expands the reach of the Making Home Affordable Programs by allowing FHA lenders to offer more substantial loan modifications. And, it protects loan servicers who modify loans from lawsuits as long as the modification is consistent with Hope for Homeowners program. Up until now, servicers have been reluctant to modify troubled loans, fearing lawsuits from the investors who own the loans.
- Gives the FHA additional enforcement tools to police lenders who employ false or misleading marketing tactics.
- Streamlines how HUD supports homeless support programs across the country, by giving local communities greater flexibility with how they use federal funding.
- Finally, it includes an amendment (S.AMDT.1035) to the Truth in Lending Act which states that any creditor who purchases or is assigned a mortgage loan must notify the borrower in writing within 30 days. If notification is not given, borrowers are allowed to recover damages.
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- Categories: FHA Loans, Loan Modification, Refinance
Comments
11 Comments so far
Peter Ccollins
Very good! This should help lenders and servicers loosen up their resricitons on home loan modification.
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Bill F
It will be interesting to see how many servicers decide to sign up for the making home affordable program now that they are protected from investor suits.
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